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Quest Means Business
US Labor Market Slows; JPMorgan CEO Jamie Dimon Weighs In On Banking Crisis; Israel Foreign Ministry: One Dead In Tel Aviv Attack; Russia Charges U.S. Journalist With Espionage; Ukraine: Russian Forces Stepping Up Attacks Around Bakhmut; Clarence Thomas Defends Travel Paid For By Wealthy Donor. Aired 3-4p ET
Aired April 07, 2023 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:26]
RICHARD QUEST, CNN INTERNATIONAL HOST: If you expected me to say that there is another hour of trading on Wall Street, you'd be wrong.
Markets are closed both sides of the Atlantic for Good Friday, and there is still a wealth of news, which the markets haven't had a chance to react to.
Tonight, we're going to talk about the new US hiring data, which suggests the Fed's medicine could be starting to work.
You'll hear our exclusive interview with Jamie Dimon of JPMorgan Chase, who explains why he thinks the regional banking crisis is over.
(BEGIN VIDEO CLIP)
JAMIE DIMON, CEO, JPMORGAN CHASE: But I think then people should take a deep breath. In a week or two, a lot of these banks will be reporting
earnings. I think they will probably be pretty good.
(END VIDEO CLIP)
QUEST: And I got an inside look at the high tech factory that might have made your newest jeans and ripped hopes in them.
Tonight live from London, on Friday, April the 7th, Good Friday. If you celebrate I'm Richard Quest in London, at Easter, Passover or Ramadan, I
mean business.
Good evening. It is worth just pausing and wishing you the very best for whatever you might be celebrating if that is your religion, and joining us
for tonight if it's not.
Tonight, the US labor market is slowing down and the Federal Reserve now has plenty to think about with the flight of inflation.
Two hundred and thirty-six thousand jobs were added in March. Now, that was bang in line with expectation. It is the smallest number in more than a
year. You can see over here, perhaps in December, but it is the smallest number in a year and that is extremely significant because it shows wage --
it shows us that job growth is slowing, which is exactly what you would expect to see with rising interest rates.
Wages are up 4.2 percent year-on-year, the lowest reading since mid-2021. That tells us that the pricing pressure of employment is starting to
reduce. It's still too high that number, but it is moving in downward path.
The unemployment rate fell a tenth of a percent and remains there in multi- decade lows. It's computed a different way, and I say this every month to you. I say this every month that it is computed in a different way so we
won't take too much notice of that.
Rahel Solomon is in New York and we will certainly take notice of you, Rahel. And now if I look at this, so this is really interesting, because
the medicine is starting to work, and I guess, forget what they are going to do at the next meeting, the issue is whether we are going to get a rush
of medicine, and suddenly, you know, the whole lot is going to be too much.
RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: Well, I can yes, the medicine is starting to finally work. Richard, this was probably as best as you
could hope for, right? A cooling as you pointed out, but a very gradual cooling. This is perhaps the best way that the Fed could expect to see it.
Two hundred thirty-six thousand, as you pointed out, and you saw in that bar chart, which I think we can pull up for you again, that that was the
lowest job growth we have seen this year, but also the lowest job growth we have seen, Richard, in quite some time. Wages have started to cool.
But here is what I found really interesting, and I think we can pull this up for you, Richard. But what I found really interesting is that labor
force participation, that also ticked up to levels that we have not seen since March of 2020, and we know why that data is so important.
We saw almost half a million people jump into the labor force, add into the labor force, so that has to be music to the eyes of the Fed, who of course,
has been hoping for more supply of workers in terms of this supply imbalance we've had in the labor force.
So certainly some good news on the labor force participation side, certainly some good news on the supply side, and job growth, gradually
slowing perhaps as good as you could expect in this environment.
A Good Friday indeed, Richard.
QUEST: Rahel, it is a Good Friday, it is a good Friday. Any Friday is a good Friday in my book.
Look, Rahel, the point is though, I'm a little more concerned that there is if you like a pent up of monetary policy still to come through. So we're
only seeing the beginning of the -- I mean, as you know monetary policy takes six to nine months to work, so we should be seeing it working now and
I worry that maybe that it is going to slow down too quickly.
[15:05:11]
SOLOMON: Well, I understand the worry, but I don't think that is what we are seeing in the data. Right? I mean, again, this is a gradual slowing. I
mean, I think this is a report that certainly the Fed has to be watching and thinking, okay, good to see that this is sort of coming down very
slowly. Interesting to see what next month will bring, that said, so, this is a gradual slowing.
I certainly understand your point and I should argue, by the way, that folks who are seeing a report like this and think, well, maybe the Fed will
just sort of, you know, slap his hands and say, all right, I think we can rest on our laurels here, I'm not so sure about that.
I mean, many banks are still calling for another rate hike. So if you are worried, Richard, about the monetary policy lag, and what we haven't
already seen really take shape in the economy, there is more coming, likely.
QUEST: And you and I will discuss it next week when I'm back in New York. Looking forward to seeing you there back in New York.
SOLOMON: Looking forward to it.
QUEST: Thank you. Have a cup of tea.
JPMorgan Chase's CEO, Jamie Dimon says we should all be prepared for a higher rate. He told CNN's Poppy Harlow, it's okay to let some banks fail,
as long as it doesn't have the domino effect.
(BEGIN VIDEOTAPE)
DIMON: This is not 2008. Okay, this is a much more limited, there are only a handful of banks that had this particular problem. They'll
eventually be resolved one way or another, and I think then, people should take a deep breath.
In a week or two, a lot of these banks are going to be reporting earnings, I think they will probably be pretty good. The Federal Reserve made some
bold dramatic moves to help make it easier for some of the issues they had, and I'm hoping it will resolve rather shortly.
POPPY HARLOW, CNN ANCHOR: You're hoping.
DIMON: Hoping, yes.
HARLOW: But is the crisis over? You wrote in your letter: "There will be repercussions for years to come."
DIMON: Well, that's different. I mean, those repercussions are regulatory. Like, now, obviously, we have a problem and things need to
change, but you know, I am begging the regulators, just take a deep breath.
There are hundreds of rules, you know, you have to be very careful. What do you want in the banking system? What do you want out? How do you make it
easier for community banks and regional banks? How do you reduce their costs, and not increase their costs, but also make it safe?
HARLOW: Do you expect more banks to fail this year?
DIMON: I don't know. But if there are, I don't -- honestly, they will be resolved and it will probably be the last of them. I think we're getting
near the end of this particular crisis and fewer financial institutions -- remember in '08, it was hundreds of institutions around the world.
Far too much leverage, we don't have that. Huge problems in mortgage markets, we don't have that.
This is nothing like that, and the American public shouldn't think that. This will resolve and then we should go look at, you know, what went wrong
and fix it, you know, in the clean -- in the light of day.
HARLOW: Well, so then, then what was it, if this is coming to an end? Is this a situation like, you know, Warren Buffett famously said, only when
the tide goes out do you learn who has been swimming naked? Were these banks swimming naked?
DIMON: Yes, so I said, they are hiding in plain sight. Everyone knew about uninsured deposits. Everyone knew about insured exposure. Everyone
knew about -- held to maturity portfolios.
The only difference, the only real difference was what we call concentrated clients. So Silicon Valley Bank had, you know, a handful of people who
controlled 35,000 corporate accounts, and they just left, you know, $140 billion or something over the course of two days. That's not happening in
other regional banks. They don't have that issue, nor do they have all these other issues. So there is only a handful that have much two of the
sides.
HARLOW: But then what's going on with First Republic? I mean, you led the effort to swoop in, $30 billion from you and your fellow banks to try to
study First Republic, and you've acknowledged we don't even know yet if that worked.
DIMON: Yes, that was an attempt to try to resolve -- help -- give them time to resolve a situation. We represent them. So, I really can't talk
about any more than that. And we hope it resolves one way or another.
So that'll come in the future, but I don't -- I don't think this is that kind of crisis, that you're going to have it ongoing forever. It will be --
now, Warren Buffett said, when the tide goes out, you mentioned something else, rising rates is that tide going out, and if that tide goes out a lot,
so I would tell people, be prepared for higher rates. I don't know what is going to happen, but be prepared in that tide.
HARLOW: Be prepared. You think the Fed raises again in May.
DIMON: Well, there are two rates. One is the short rate, I do not know what they're going to do. And obviously, they may not because, you know,
financial conditions, but also longer rates and that has a different effect and that the Fed does not control directly. That is controlled by global
investors, sentiment, supply and demand and that's gone bad for sovereign debt, okay.
So, you know, to me, yes, you have a chance that long rates will be going up and people might have to get used to higher for longer.
HARLOW: Higher for longer.
DIMON: Yes.
HARLOW: Get ready for that.
DIMON: I believe that is a -- I think it has a high outcome for other people. I'm not predicting it.
HARLOW: Right. Is the American banking system truly safe and secure?
DIMON: Yes. I mean, the banks have extraordinary liquidity, extraordinary capital. When they report earnings next quarter, the earnings are going to
be quite good in my opinion. Can handle not just one stress test, but multiple ways of being stressed.
HARLOW: Those are the big guys who have to abide by all those requirements. I'm talking about the mid-size and little guys that don't
anymore.
[15:10:08]
DIMON: Yes. Well, they have formal requirements than you think. So I don't think it was the requirement. Some people think that they were --
HARLOW: The roll back.
DIMON: That roll back literally had nothing to do with it.
HARLOW: How do you know?
DIMON: Because they had the same internal liquidity requirements, stress requirements, reporting requirements, supervisory requirements. They made
mistakes.
HARLOW: It was different if they were under $250 billion in assets.
DIMON: Not as much as you think.
HARLOW: So all those senators that are saying it was wrong to roll them back. Democrats rolled it back, too, some of them. Those senators are
wrong?
DIMON: Yes. You know, look, it's not -- again, when you talk about regulations, they are looking at one thing, I'm looking at multiple others.
So they had high liquidity requirements, high capital requirements. They met the requirements, they had too much insured exposure and things should
change.
But they were not out of line with super, you know, with regulations. It wasn't the regulatory change. It was other things, and in life, that's
going to happen. This notion that somehow you can make everything perfect is wrong.
HARLOW: I know. But you don't want big, well-known banks to collapse.
DIMON: No, you don't, but you also really want is that every now and then something will happen and the system can handle it in due course.
HARLOW: Let them collapse.
DIMON: Yes. Failure is okay. You just don't want this domino effect. And so when you have a bank run, you end up with some kind of domino effect.
So I guess my point is, we are close to it, get to the point where a bank can fail and it doesn't have this kind of effect.
HARLOW: Okay.
DIMON: And I think just monitoring changing a few things can get much, much closer to that.
(END VIDEOTAPE)
QUEST: Poppy Harlow talking to Jamie Dimon on the banking crisis, and the impact, of course, in the crisis we won't have seen yet in the numbers.
Some economists fear the sector wobbles, eventually we'll cool the labor market further.
The stability of the banks, the debt ceiling, the cost of living -- these are all factors weighing on the American economy and the American worker.
We've polled the workers and a group of them on their views, 29 percent say it's in good condition, that's up from 22 percent last fall; but down from
54 percent who said that some two years ago, which perhaps isn't surprising.
Professor Jason Furman is with me. He is a Professor of Practice at Harvard Kennedy School and the former Chair of the US Council of Economic Advisers,
joins me tonight from Cambridge, Massachusetts.
Good to see you, Jason. As always, thank you, sir. Grateful for your time.
I'm fascinated. Are we within striking distance of a soft landing here?
JASON FURMAN, FORMER CHAIR OF THE US COUNCIL OF ECONOMIC ADVISERS: I don't think so. I think people are getting out over their skis.
The labor market data looks great, but now let's go look at the inflation data. That's been running core inflation, underlying inflation, about four-
and-a-half percent for the last year, pretty consistently.
We haven't seen much progress on actual inflation. I hope we get it. But there's a lot of inferences and models between here and there that I'm not
sure I believe.
QUEST: Right. So when we see this number that's come down or at least is moderating, I think that's -- easing might be an even better word, would
you say, on strict technical, theoretical economics, would you say that number has to slow down more of job growth, if inflation is going to come
down to two percent?
FURMAN: Look, Richard, we've never seen inflation fall by two-and-a-half percentage points, which is what we need, with unemployment, anything like
where it is now. Could we see something completely unprecedented happen here? Yes. I'm rooting for that. I hope that happens. But that's not what
I'm predicting. I never like to say if you've never seen it before. Sure. Let's go ahead and assume we're about to see it right now.
QUEST: I guess what I then have to understand is how it plays out, because we go in from last year into the first part of this year, and we
have a gangbusters economy and this job number is stubbornly high, but you've got monetary tightening now in the pipe. And I'm guessing we're
seeing the first of that monetary -- the effect of that monetary tightening coming out of the pipe.
FURMAN: Look, we don't know what would have happened without it. Without the monetary tightening for all we know, the unemployment rate would be
2.75 right now, and the inflation rate would be eight percent.
So I think it's possible at work that just with so much strength, so much demand in the economy, the big lag that is yet to play itself out, is the
potential for a credit crunch. I think that's real. I had been for 50 basis points at the last meeting before Silicon Valley Bank. I agreed with the
Fed, they couldn't and shouldn't have done nearly that much when this is doing some of the work for them and we're just starting to see that work
start now.
QUEST: Yes, the only problem of that, I mean, it was very telling wasn't it, Jay Powell, the Chair actually admitting that de facto the credit --
the SVB's credit crunch is a raising of interest rates, but the only problem is they can't control that.
[15:15:14]
FURMAN: Well, that's the question. Do I think a financial crisis is a good way to bring down inflation? Absolutely not. You don't want that
crazy, nonlinear dynamic and to unleash that, but do you think a bit of extra interest rates here, a bit of extra tightening lending standards
there, affecting a wide range of sectors in the economy? That's exactly what you want and it is possible, that's what they're going to get.
QUEST: So if you look at the IMF this week, basically slow growth for the foreseeable future, the slowest growth in decades for the foreseeable
future. That is not a particularly rosy scenario.
FURMAN: It's not a rosy scenario. Look, the IMF, it is a perfectly reasonable forecast. These things are impossible to forecast. It's always a
little faddish. Their last forecast, they thought inflation was under control, we'd have a soft landing. Now, they've done this one. You know,
we've got a great jobs number yesterday. So I don't quite know.
What I do know, Richard, though, is I think we're probably either going to have decently high inflation or we're going to have a higher unemployment
rate. I'm not sure both of those, you know, one problem is going to be fixed without creating other.
QUEST: And I've been saying since the beginning of all of this, the real test here is whether the Fed basically says, well, I think three percent is
fine. We can -- or three-and-a-half or four percent, we could all go home now, or do they push on for two? Because you're right, if you go for two
percent, rates have to go higher, more has to slow?
FURMAN: Yes. I personally think three is fine. I hoped that they would be fine with, say, a 2.9 percent inflation rate. I think three-and-a-half is a
bit above where they should be. And you know, if you're at three-and-a- half, a year later, you might be at four. So I think they probably need to get something with a two in front of it. But if it's 2.99, you know, I'll
declare it a victory. I hope they do, too.
QUEST: Jason, I shall remind you, 2.99 is a good number, if and when we ever get there.
Have a lovely weekend, sir. I'm grateful to you. Thank you.
Some breaking news that I need to bring to your attention from Israel: Seven people have been wounded and two seriously, in a terror attack at a
Tel Aviv promenade according to a tweet from Israel's Foreign Ministry. We will tell you the latest. We'll be in Jerusalem to give you details of
what's happened in just a moment.
(COMMERCIAL BREAK)
[15:20:13]
QUEST: As I said breaking news tonight coming from Israel where seven people have been wounded, two of them, I believe seriously. Israeli
officials are calling it a terror attack at Tel Aviv's promenade. We are waiting for more details on the attack. And, of course to put this into the
full context, tensions have been exceptionally high over the past week with Israel's military on high alert and having mobilized reservists.
The Israeli -- the IDF launched airstrikes into Southern Lebanon and Gaza and the strikes came only hours after dozens of rockets were fired from
Lebanon into Israeli territory.
The Israeli military is blaming the incoming rocket fire on Palestinian militants. It was the largest barrage from Lebanon since 2006, when the two
countries were at war.
At the West Bank -- in the West Bank two British Israeli sisters were killed in a shooting. A Qatari official says the country is trying to
deescalate tensions through mediation. And Israel's Foreign Minister has also spoken to his Turkish counterpart who is urging calm.
CNN's Salma Abdelaziz who we'll be talking to, in just a moment live in Israel. For the moment, here's her latest report, which puts it all into
context.
(BEGIN VIDEOTAPE)
SALMA ABDELAZIZ, CNN CORRESPONDENT (voice over): A day that began with rockets from Gaza that struck a home in Sderot. No one was killed in the
attack, the latest in a wave of missiles fired from Gaza in Southern Lebanon in recent days.
Violence also spread to the West Bank on Friday. There, two Israeli sisters were killed and their mother seriously wounded in the shooting, described
by Israeli forces as a terrorist attack.
Hamas praised the deadly attack as a heroic act of resistance.
In recent days, a major escalation across the region has raised fears of a wider conflict. This is the latest catalyst. Israeli Police twice stormed
Al-Aqsa Mosque Wednesday.
Overnight footage showed the dramatic raid. Israeli forces hitting worshippers with rifle butts and batons. Israeli Police say they entered
the Mosque after hundreds of rioters barricaded themselves inside and that their officers were attacked with stones and fireworks.
Palestinians in the wider Muslim world see the raid on the Mosque as a provocation, particularly during the holy month of Ramadan.
Condemnation quickly poured in, as well as rockets from two directions, Southern Lebanon and Gaza.
ABDELAZIZ (on camera): It all begins and ends at the Holy Site you see behind me here, known as the Noble Sanctuary to Muslims or the Temple Mount
to Jews, it is dictated by a decade's old agreement that says only Muslims can pray at the site. Some non-Muslims are allowed at certain times at the
complex, but any violation, real or perceived that so-called status quo agreement could quickly ignite tensions.
ABDELAZIZ (voice over): And many Palestinians fear that's exactly what's happening. There have been calls by Jewish extremist groups to slaughter
goats at the Mosque compound during Passover. And in January, an inflammatory visit by Israel's far-right National Security Minister Ben-
Gvir drew international condemnation. He is convicted of supporting terrorism and inciting anti-Arab racism.
Prime Minister Netanyahu has insisted his government is not seeking to change rules that the Holy Site.
On Friday, tens of thousands gathered at the steps of Al-Aqsa Mosque after a peaceful prayer service. Banners read, "Al-Aqsa is a red line." Another
said "Do not test our patience."
The US, UN, and other members of the international community have called for restraint and calm, but with two weeks of Ramadan left and the Passover
Holiday underway, it remains a sensitive time in a deeply sensitive place.
(END VIDEOTAPE)
QUEST: Salma is with me in Jerusalem. We're hearing from the Israel's Foreign Ministry, the person has died in that terror attack in Tel Aviv. So
I mean, if this plays out in the awfulness that it always does, one would expect some what I say robust, brutal reaction from Benjamin Netanyahu in
return.
ABDELAZIZ: Absolutely, Richard, this is breaking news just coming in this hour. It is only just developing, so we're still getting details, but
absolutely horrifying and it comes in extremely sensitive time as you saw in that piece right now up from the Israeli Foreign Ministry tweeting right
now, one person killed and six wounded in a vehicle attack. They're declaring it as a terror attack.
They say a vehicle was used to strike pedestrians along the promenade in Tel Aviv, of course that's right along the shoreline. That's an area that
would be full of businesses, shops, restaurants, an area where families and friends would gather normally.
[15:25:08]
ABDELAZIZ: It's important to know it is the Passover Holidays. You can expect many of those businesses were closed, but of course, some people,
the streets largely quiet, but some people still out and about their business. This is again, a very sensitive time.
You have several religious holidays, coinciding at once in the region. Ramadan is very much underway. We're in the middle of that Holy Month for
Muslims. Passover is also underway. Easter has coincided. And then of course, there's the larger picture here, Richard. There has been a massive
escalation in the region.
The catalyst for that was an Israeli Police raid on Al-Aqsa Mosque earlier this week, that, of course, was seen as a provocation by the Muslim world,
again, particularly because it is Ramadan. A condemnation from the Muslim world quickly poured in, as well as rockets were fired from two different
locations from Southern Israel and from Gaza in recent days. Those coming from Southern Israel was a huge barrage.
So all of this mixing in at this time, and now this additional terror attack in Tel Aviv, this will absolutely be heartbreaking news for people
across the region -- Richard.
QUEST: All right, so this also has to be seen in the context of the domestic political upheaval in Israel. How does that play to it?
ABDELAZIZ: I think there's a lot of different factors to play in here. When we're talking about this terror attack, in particular, I think it's
simply too soon to tell. This is breaking news. We are only getting the details just right now.
But yes, if you are looking at the larger context here, you are looking at the most far-right government in Israel's history coming into place under
Prime Minister Netanyahu. There are serious fears and concerns among Palestinians that that could shift the so-called status quo of one of the
Holiest Sites for Muslims, one of the Holiest Sites for Jews, and that is Temple Mount as it is known to Jews, the Noble Sanctuary as it is known to
Muslims.
Many Muslims fearing that that status quo again, that agreement that allows only Muslims to pray at that site, people of other faiths, non-Muslims are
allowed to visit on certain occasions, that larger compound, but only Muslims allowed to pray on that site. There is fear that that status quo
changes. There is fear as to what it means for many Palestinians to have this most far-right government in place.
And of course, we've seen that judicial overhaul and the mass protest movement that it has led to for the last few weeks. But again, you're
looking at a time that is extremely sensitive. It is Passover, there was already a horrifying terror attack just a few hours ago today. This yet
another one. This right now is a moment of mourning, a moment of fear, a moment of heartbreak for those celebrating Passover, and getting these news
reports of yet another terror attack just today -- Richard.
QUEST: All right, Salma Abdelaziz, thank you.
Coming up next, as the Easter weekend begins, the Pope is missing tonight's ceremony at the Coliseum because of his health. This are live pictures
tonight with the Vatican and we will be in Rome in a moment.
(COMMERCIAL BREAK)
[15:31:26]
QUEST: Hello. I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. We'll hear from Jamie Dimon, the Chief Exec of J.P. Morgan Chase.
The geopolitical dynamics and what's worrying him at the moment.
And the founder of Beximco gave me a tour of his company's massive textile factory in Bangladesh, which he says brings the prosperity to the country.
We will get to all of that and more only after the news because this is CNN. And on this network, the news always comes first.
Russian state media says the journalist Evan Gershkovich has been formally charged with espionage. He is the U.S. Wall Street Journal reporter who was
detained last week while working for the Journal. U.S. embassy in Moscow says it has not been granted consular access to see him and the White House
of course has called for his release.
Ukrainian military officials say Russian forces launched more than 40 attacks in the region around Bakhmut in the past day as they tried to take
full control of the eastern city. Ukrainian forces say they are repelling many attacks and claimed to destroy a Russian aircraft.
In a state when the U.S. Supreme Court Justice Clarence Thomas was defended the luxury travel paid for by a wealthy Republican donor. Justice Thomas
claims the donor is a close friend, saying he was advised not to report personal gifts. The congressional Democrats have called for an
investigation into the matter.
Chinese state media say President Xi Jinping has told his French counterpart Emmanuel Macron that a ceasefire in Ukraine is in everyone's
interest. And President Xi also told Macron that all parties are responsible for a solution saying China would welcome a French peace
proposal.
Chief Executive of J.P. Morgan Chase who heard earlier in the program, Jamie Dimon says that the war in Ukraine is sparking a dramatic global
shift. He was speaking exclusively to Poppy Harlow. And he told Poppy what worries him the most looking ahead.
(BEGIN VIDEOTAPE)
JAMIE DIMON, CHIEF EXECUTIVE OFFICER, J.P. MORGAN CHASE: Quantitative tightening, the effect that has on long-term rates, inflation higher for
longer. That's kind of the tide going out. So, even when Bear Stearns went down, you think other people have seen that and said, I have too much
leverage, too much mortgage debt, too much this and made some changes. Lehman went down six months later.
I think they might have been able to fix that in the meantime. So, that's a little bit of a warning to people. And I -- but I think this one Ukraine or
-- I think that is changing everything we think about the world, how we should think about safety and security, even around food, energy is
changing economic relationships is (INAUDIBLE) in the relationship with us and China. That is the most important thing.
I mean, if you want to have a free and democratic Western world and an American century in the next 100 century, that's what we got to focus on.
POPPY HARLOW, CNN ANCHOR: You said last year on that front, the autocratic world thinks that the western world is a little lazy and incompetent. And
there's a little bit of truth to that. Is that still how you see it?
DIMON: Yes. I think, you know, I think we do a lot of things that -- we're in great position. So, you know, for the American public, we have food,
water, energy with most prosperous nation the worlds ever seen. That's still true. The most innovative. Just go to Atlanta, go to -- not -- some
people in just Silicon Valley, but it's in Atlanta too, it's in New York, it's in Brooklyn, you know, it's all over the place.
[15:35:00]
We have the -- GDP per person is $70,000 plus. Chinese is 15,000. They import 10 million barrels of oil a day. They don't have the Atlantic and
the Pacific, they have a very complicated neighborhood. They're, you know, they're aiming their neighbors who are all starting to rearm. We've got a
great hand. On the other hand, we haven't done a pretty good job taking care of our lower-paid citizens or inner city schools, immigration,
taxation.
And I think people should pay their taxes, litigation, which, you know, it costs one percent of GDP. And if it was -- if it created more fairness in
life, I'd say it was good, but as capricious, arbitrary slow, you know, and I -- so I can go on and on about mortgages, afford -- you worry about
affordable housing. You know, we all agree with that. But very often, the problem with affordable housing isn't capital, it's local zoning laws. So,
if America just got up its own way. I think we grow at three percent a year.
HARLOW: Are you worried about how close Iran, Russia and China are to one another right now and are getting to one another? Do you think about that?
You're a student of history.
DIMON: I mean, if you were going to ally with the Western world, America and Europe, Western world, or you're going to ally with Iran, and Russia, I
mean, please, am I worried? Not really.
HARLOW: That doesn't worry you?
DIMON: No.
HARLOW: It worries some of our top generals.
DIMON: OK. You said military? Yes, you should worry about geopolitics. But I just told you what a great hand America has. Same with kind of Europe,
what we should be doing is making sure we're the allies, not just militarily, but economically, strategically, diplomacy, development,
finance, you know, have the rest of the world want to join us. So, if you're India, would you rather be part of that group or part of the Western
world?
HARLOW: Are we doing enough --
(CROSSTALK)
DIMON: No. We're not enough. No, I think, you know, Bob Gates in his book, I've already called the symphony of power, something like that, said the
symphony includes diplomacy, development, finance, you're having business involved in helping develop, you know, Africa, Latin America, parts of
Asia. I think we could do a far better job coordinating that as a policy. I think, by the way, the administration thinks that too.
And the other thing -- but you can't take trade off the table. So, the first thing we do is we take trade off, take away from the start. No, trade
may be the most important thing for these countries. And while there are legitimate complaints about trade, we can do it better. We can do it right.
And we should be very thoughtful about it.
(END VIDEOTAPE)
QUEST: If you were with us last night, very much the issue we're talking about with Martin Wolf (INAUDIBLE) we'll muse on that later. As part of the
world begin to commemorate Easter. The Pope has made an important change to his plans for the sake of his health. He is not going to participate in the
Stations of the Cross prayers at the Coliseum tonight. The Vatican said it was due to intense cold weather there.
The pope, he is 86, he's still recovering from his pouch of bronchitis which kept him in hospital. He did have ever take part in a Good Friday
service earlier and is set to lead mass on both Saturday and Sunday. Delia is with me in in Rome. Delia Gallagher. Delia, the -- I guess what they're
doing here is prioritizing that which the Pope should do, A, because of the weather and B, because of his strength.
DELIA GALLAGHER, CNN VATICAN CORRESPONDENT: Yes. Absolutely. Richard, I mean, under normal circumstances, we would be concerned that the Pope is
skipping an event like the Via Crucis at the Coliseum. I hope you can see the pictures. It is a beautiful traditional once-a-year event. However, 86
years old, recovering from bronchitis. This event is outdoors. It is unseasonably cold, it's 9:00 at night and it goes until 11:00 at night.
Pope sits up on a hill.
Obviously, a prudent decision on the part of the Pope and his advisors to have him stay home because this is the busiest week for the pope in the
calendar year. And he got out of hospital on Saturday and on Sunday, he was in the square for Palm Sunday Mass. We saw him yesterday at a beautiful
event with the juvenile jail event where he was washing the feet of 12 young people in the jail there. He looked in very good spirits.
And indeed, we saw him just a few hours ago in St. Peter's Basilica for the Good Friday service. So, I don't think there is too much cause for concern
that he is sitting this one out. As you mentioned, Richard, he will also be doing mass tomorrow night for the Easter vigil and Sunday in St. Peter's
Square.
QUEST: Delia, thank you. And let me wish you a good Easter, if you're celebrating. I wish you -- I wish you the season's greetings. Thank you.
During my recent trip to Bangladesh, I visited one of the country's largest clothing factories. Now, I still don't understand why someone would
willingly pay to have holes in their jeans. But I did learn how those holes get there.
(BEGIN VIDEO CLIP)
QUEST: Why don't you make a product that doesn't have a hole in it?
SALMAN RAHMAN, CHAIRMAN AND FOUNDER, BEXIMCO GROUP: It won't sell.
QUEST: Let the ripping begin.
(END VIDEO CLIP)
[15:42:30]
QUEST: You will not be a stranger to the labeling clothes made in Bangladesh. It's happening more and more. In fact, it seems to be
ubiquitous these days. The garment industry in Bangladesh is a cornerstone of the national economy has been for years and is growing strongly. Woven
garment exports were up ready to made -- RMG they call it, ready to made to -- ready to wear, I should say we're up 12 percent over the last nine
months compared to previous years.
Now you'll recall I was in Bangladesh just a couple of weeks ago. And while I was there, I spoke to the head of one of the country's largest clothing
manufacturers.
(BEGIN VIDEOTAPE)
QUEST (on camera): All right. Where are we going?
QUEST (voice over): When Salman Rahman cofounded Beximco in the 1970s, the country of Bangladesh was in its infancy. Fresh off a brutal war for
independence, the new government faced daunting economic challenges. Now the country's economy has grown. And so, as its biggest company.
QUEST (on camera): Did you ever get overall by the sheer -- the poverty that we've been seeing? I mean, it's just so extraordinary the amount even
though it's gotten a lot better.
RAHMAN: Overnight, I don't agree with you, Richard. Maybe you'll see what we're doing over here. This is all a progress. This is prosperity.
QUEST (voice over): Beximco brings in hundreds of millions of dollars in revenue each year. The interests are as varied as energy, financial
services, pharmaceuticals, and of course, the rock-solid textiles.
Rahman went from being an entrepreneur to a cabinet minister and adviser to the prime minister. Rahman invited me on a helicopter tour to see the
origins of Made in Bangladesh.
QUEST (on camera): Can't you make a project that doesn't have a hole in it?
RAHMAN: It won't sell.
QUEST (voice over): The facility employs tens of thousands of people. Spinning yarn, weaving fabric, making denim. It is state of the art. And
Rahman told me the supplies come in from all over the world.
RAHMAN: United States, Middle East, India, Egypt.
QUEST (on camera): So that cotton can cross the Atlantic several times.
RAHMAN: Absolutely. So, we start with a bale of cotton. We end up with a shirt.
QUEST: Made in Bangladesh.
SYED NAWED HUSAIN, CHIEF EXECUTIVE OFFICER, BEXIMCO: Basically, it starts at the catwalks of Paris and Milan.
[15:45:03]
And you and I and everyone else actually have enough clothes. So, you know, why do you need to buy more clothes? So, fashion is really a conspiracy to
make us -- make our closets obsolete.
MERYL STREEP, AMERICAN ACTRESS: It's sort of comical how you think that you've made a choice that exempts you from the fashion industry when, in
fact, you're wearing the sweater that was selected for you by the people in this room.
HUSAIN: So, it tells you that unless you come and spend more money, you're not in sync. And you're out of debt.
QUEST: Hang on. You're just -- you're just arguing against your own business here.
HUSAIN: No, no, no. I'm arguing in favor of my business. In the sense that if that conspiracy was not there, then we would not have a business.
QUEST: Question. The garment, the t-shirt that is sold for six, $7.00 or five euros, five pounds. I mean, how do you make any money out of that? By
the time it gets to Europe or the U.S.?
RAHMAN: It's very, very difficult because when we are negotiating with the buyers, you know, it's like Navaid (ph) said, it's like an ant on an
elephant's trunk.
QUEST: So, do you have power with the big buyers? The Wal-Mart, the Prime obviously. Do you have power with it?
HUSAIN: You know, you take Wal-Mart $500-million gorilla. And he is in a position to bully companies like Procter and Gamble. So, relatively, when
he rounds off his balance sheet, many examples disappear. But we still have power because he needs compliance. He needs beautiful product. And we tried
and we need the scale to pay 40,000 workers so we have the efficiency of scale.
QUEST (voice over): The question of compliance took on greater importance 10 years ago. After the Rana Plaza disaster where more than 1000 people
died when a nine-storey factory collapsed in Dhaka. Only months before a fire killed 100 workers in a Tazreen Fashions clothing factory nearby. And
the back-to-back disaster sparked international outcry about working conditions.
The Bangladeshi Government promised to improve factories and now Husain says the buyers put major pressure on them to ensure safe conditions for
workers.
QUEST (on camera): How do I know that the moment I leave the all the good work -- the compliance is just going to go out the window? Nobody's looking
(INAUDIBLE) be paid. Who's protecting it?
HUSAIN: Number one --
RAHMAN: Very good -- very good question. The protection is coming from the buyers. So, you remember that after the building collapse in Bangladesh,
which everybody talks about the big fire, the industry got together, the government got together, the buyers got together and the brands got
together. And we put in a lot of investment in improving the quality of the buildings and for fire safety.
QUEST (voice over): Today's textile industry is state of the art. And while the garments industry's progress has not always been straightforward, these
factories have made it the fabric of Bangladesh's economy. And its executives hope it will continue to increase the country's prosperity. One
pair of jeans at a time.
(END VIDEOTAPE)
QUEST: And if you want to know how they put the holes in them, I promise you we will show you that one point.
The Masters is one of the world's most prestigious events and a player who joined the Saudi-backed LIV Tour is in the lead will be in Augusta, Georgia
next after the break. QUEST MEANS BUSINESS.
(COMMERCIAL BREAK)
[15:51:29]
QUEST: I promise to update you with the events in Israel. We now know that a person is dead and six have been injured in Israel -- what Israel's
foreign ministry is calling a terror attack. It took place at Tel Aviv Promenade. The Israeli police say there may have also been a car that
rammed into people in the same area. You getting the idea. It's all a bit confused exactly what happened and how the changes are far from certain.
The Prime Minister Benjamin Netanyahu has ordered Israeli police and defense forces to mobilize all additional units. Tensions have all just
building up this week. Israel's military is on high alert and has mobilized reservists after launching airstrikes into southern Lebanon and Gaza. And
only hours ago, dozens of rockets were fired from Lebanon into Israeli territory.
Rain briefly suspended play at the Masters golf tournament where a member of the upstart LIV Tour is in the lead. The tournament is one of golf's
biggest and a blow to the PGA. It welcome back rows like Brooks Koepka. Defected to the rival group backed by Saudi Arabia. Tiger Woods is also in
the spotlight. He appeared to be in pain during yesterday's round, and he said, this could be one of his last Masters appearances.
(BEGIN VIDEO CLIP)
TIGER WOODS, PROFESSIONAL GOLFER: I don't know how many more I have in me. So, the -- just to be able to appreciate the time that I have here and
cherish the memories. And I know more guys on the Champions Tour that do the regular tour.
(END VIDEO CLIP)
QUEST: Don Riddell is in Augusta. Let's hear first of all with the -- with the leader at the moment in the Masters. I mean, since the LIV brought the
best and some of the less has been. Since they bought the best and now, they're allowed to compete. It's not surprising that a LIVer if you will,
will be near the top or at the top.
DON RIDDELL, CNN SPORTS ANCHOR: Well, it's interesting you put it that way, Richard because when they lured Brooks Koepka on to the LIV Tour, he was by
no means the best. In fact, he was playing absolutely terribly and he was in a lot of pain because he was dealing with injuries. LIV managed to
attract a lot of players with big resumes, a lot of accomplishments, but not many of them were actually at the top of the world game in the moment
they join the LIV tour.
But it is surprising to see Brooks Koepka doing this well. He has really been struggling over the last few years. And he kind of disappeared. And
since he's been on the LIV Tour, people that follow the PGA Tour didn't really know how he was playing. And even if he was doing well, what did
that really mean on courses that we -- easier against weaker fields arguably and in tournaments without any cuts.
But Koepka won on Sunday on the LIV Tour in Orlando and he's come here and he's looking absolutely phenomenal. Seven under on the first day, five
under today, 12 under in the clubhouse, he's leading by four. And this is a tournament that he really wants to win. He's spoken to the media today. He
says that he's pursuing the career slam. He's already got two in the bag. The PGA Championship and the U.S. Open. Masters is next on his list.
And you can tell how much this tournament means to him because he also revealed that when he missed the cut here last year, he went into the
parking lot and punched the back window of his Mercedes twice. He really wanted to break it. It didn't break. So, he said that was a win for
Mercedes. But that gives you a sense of kind of what he's been through, the emotional turmoil he's experienced.
And now he's back here in dominant form and he's putting on quite a show.
QUEST: All right. So, Tiger Woods, I'm guessing brief Tiger -- I mean, how much longer?
[15:55:08]
RIDDELL: Well, I mean of course everybody hopes that he keeps on playing, but it's not as easy for him as it used to be. He's only two years removed
from that awful car accident in which he could have lost his leg. He did tell me this week that it does cross his mind now when he's on the course.
So, this could be the last time. We all hope that's not the case. This is his 25th Masters. He's won it five times. He loves it. The patrons love
seeing him here.
But he's got his work cut out for him this afternoon. He's got about nine holes still to play. He's currently two over par. The projected cut line is
three over par. So, he has a bit of wiggle room. Everybody's hoping that he stays in the tournament and plays the last two rounds. He hasn't missed the
cut here since the mid-90s, since he turned professional. So, the expectation is that he's always here but he's going to have to fight to
make sure.
QUEST: Don Riddell in Augusta. Thank you, sir. Have a good weekend and some good golf. I will have a profitable moment for you after the break.
(COMMERCIAL BREAK)
QUEST: Tonight's profitable moment. Jamie Dimon tonight was talking about trade and the importance of it and the necessity for governments like the
United States to continue to promote it. It's the same argument that Martin Wolf was using last night here on QUEST MEANS BUSINESS. However, I have a
problem with it both in the sense, they both sort of swept under the carpet.
This issue that those who suffered during the globalization, it's almost like it was a rounding error. It was dismissed, oh, we made a mistake back
then. The problem is today, it's not surprising that globalization has such a bad name. So many people were thrown on the scrap heap of globalization.
And the fear is now that the same is going to happen with A.I., arguably on a much greater scale.
So yes, I accept Mr. Wolf, of course and to learn at Mr. Dimon's point that trade is the engine of growth to bring the world out of poverty. But in the
developed world, we do need to do a better job of remembering those who are thrown out of work, who can't compete, who no longer have a role in the
employment. And not just dismiss them as being collateral damage, because that is the reason why globalization is so unpopular in so many parts of
the world today.
[16:00:03]
And that is QUEST MEANS BUSINESS for tonight. I'm Richard Quest in London. Whatever you're up to in the hours ahead, I hope it's profitable. I'll see
you. I'll be back in New York next week. Have a lovely weekend.
END
