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Quest Means Business
ECB Raises Rates To Highest Level In 22 Years; At Least 78 Killed In Shipwreck Off Greek Coast; Biden: Live Nation Ticketmaster Will Now Advertise Extra Fees Upfront. Aired 3-4p ET
Aired June 15, 2023 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ZAIN ASHER, CNN INTERNATIONAL HOST: A positive day for the market. The Dow has recovered all of yesterday's losses. Let's take a look here. It's
currently up more than 500 points. Those the markets, and these aren't the main events.
The European Central Bank raises rates to their highest level in 22 years.
And no more hidden fees. Under White House pressure, US ticket sellers pledge to offer more transparent pricing.
And Qantas unveils more about its plans for ultra long-haul travel.
Coming to you live from New York. It is Thursday, June 15th. I'm Zain Asher in for Richard Quest, and this is QUEST MEANS BUSINESS.
Tonight, the head of the European Central Bank says it is too early to even think about a pause. The ECB raised its benchmark interest rate by a
quarter of a percentage point. It is now three-and-a-half percent, the highest since May 2001.
The Eurozone inflation fell last month to 6.1 percent. ECB president, Christine Lagarde says it is projected to stay too high for too long, so
that means more increases are on the way.
(BEGIN VIDEO CLIP)
CHRISTINE LAGARDE, PRESIDENT, EUROPEAN CENTRAL BANK: Are we done? Have we finished the journey? No. We're not a destination.
Do we still have ground to cover? Yes, we have ground to cover. And I can't even go further than that. I can tell you that bearing a material change to
our baseline, it is very likely the case that we will continue to increase rates in July.
(END VIDEO CLIP)
ASHER: Katharine Neiss is the PGIM chief European economist for fixed income. She joins us live now from London.
So that was quite a hawkish message from Lagarde. I mean, just walk us through how much more ground do you think the ECB will need to cover here,
KATHARINE NEISS, CHIEF EUROPEAN ECONOMIST, PGIM FIXED INCOME: Well, they are clearly still very concerned about headline inflation, which at around
six percent for the ECB is uncomfortably high.
And moreover, a lot of that high headline inflation is being driven by food and energy due to the war in Ukraine, but even if we strip out those
components and look at core inflation, even there, we're still not seeing a really clear trend that core inflation is coming off.
So my sense is that those two data points have high headline inflation and high core inflation are concerning to the ECB that that could potentially
push up nominal wages further and just prolong this period of too high inflation.
And so to guard against that, they decided to continue to raise interest rates at today's meeting, and also, as your clip show, to very clearly
signal that they see more of those interest rate rises in the months to come.
ASHER: Yes, Christine Lagarde certainly did not mince her words. The ECB also cut growth forecasts, but they're not quite forecasting a recession
just yet this year.
I mean, just walk us through whether you think more rate hikes will push the EU area into negative growth. What's your projection on that?
NEISS: That is a big concern because although inflation is high, in many places we see it in the US, we see it in the Euro area, the real primary
drivers of that are actually quite different.
In the U.S., you see very much an overheating economy, a very, very strong labor market. In the euro area it has been much more driven by the war in
Ukraine and the impact that that has had on food and energy prices.
And so if you look at for example, domestic demand, so if you look at indicators like consumption in the Euro area versus consumption in the US,
you can see that in the Euro area, consumption is still very weak. It hasn't even recovered the level that we saw before the pandemic whereas in
the US, it surged well above that level.
So a very different domestic demand picture, which would normally mean that the risks are greater in the case of the Euro area, that higher interest
rate rises by further dampening demand could eventually lead to inflation that is too low, but clearly that is not the big risk that the ECB are
seeing just now.
And they're much more concerned that this prolonged period of high inflation is going to feed into higher inflation expectations.
ASHER: What's interesting is what we saw happen in Sweden. Economists essentially pointing their finger at Beyonce for contributing to the hike
in overall prices, inflation.
Apparently, the artist's decision to kick off her tour in Solna, led to a surge in hotel and restaurant prices. So people are literally blaming --
economists are blaming Beyonce for contributing to inflation in Sweden. What does that tell you about just how vulnerable certain economies and
fragile said economies are here?
NEISS: Well, you know, we do see from time to time these big significant events show up in the aggregate data. We see it here in the UK, for
example, when we have special bank holidays, around the Queen's Jubilee last summer, retailers were saying that they were selling a lot more food
and party treats.
And you know, beyond a few fun headlines, people generally don't pay that much attention to these things because they tend to fade, you know, as
quickly as they've come.
But clearly now, these things are happening against a backdrop where inflation is already uncomfortably high. And so, you know, that just makes
it even more challenging for Central Banks that are really trying to keep a lid on inflation expectations and bring inflation back to the two percent
ASHER: All right, Katharine Neiss, thank you so much for being with us. We appreciate it.
The ECB's decision marked a divergence in policy at major central banks. Less than 24 hours earlier, the US Federal Reserve said it would pause its
rate hiking cycle. The Fed Chair said it makes sense to slow down its pace as it approaches its terminal rate.
And in China, the government is cutting key interest rates as its economy struggles to recover after the lifting of zero COVID restrictions.
Ruchir Sharma is the chairman of Rockefeller International. He joins us live now. Thank you so much for being with us.
I want to start with China, because there has really been a string of negative data over the past couple of weeks. Just explain to us why China
is really struggling so much to recover here.
RUCHIR SHARMA, CHAIRMAN, ROCKEFELLER INTERNATIONAL: Well, I think that the expectations out of China have not been reset sufficiently enough. As you
know, the Chinese economy now is undergoing some very major structural challenges. One of them is demographics, that's been well telegraphed.
But for the first time in its recent history, the Chinese population is now actually shrinking, its labor force is declining. No country in the history
of economic development has been able to grow at a rate of more than two percent when its labor force has been shrinking, especially as much as
The second issue has to do with the fact that China has massive levels of debt, debt levels that are even higher than a developed country, such as
the United States, if you look at the total debt, and that is also weighing down on the country. In a way, it has already borrowed a lot to grow in the
past, but it has borrowed from the future.
So I think that you have the structural headwinds out there, and a lot of people haven't quite adjusted their expectations to that, which is why I
believe that the underlying trend growth in China this decade, is likely to be in the two to three percent ballpark, rather than the five percent
target that the government has set, and also what many observers of China just like to follow whatever their government in China says.
ASHER: And speaking of structural damage, I mean, it's highly likely that two years of COVID-19 lockdowns also contributed to major structural damage
when it comes to the Chinese economy, as well. What does this mean for global growth? You know, what China's going through right now and the fact
that it's struggling to recover, what does that mean for global growth? Because China obviously does have a role as the engine for the rest of the
world, the economic engine of the rest of the world.
SHARMA: In this regard, I have to say that I'm a bit more optimistic. And in fact, I'd written a piece in one of my columns at "The Financial Times"
a couple of years ago, saying that the impact that China has on the rest of the world has begun to decline, because the Chinese economy has turned more
inward, it is less reliant also on external sources.
And I think that what is happening therefore, because of that, is that we saw this in the last few months. In fact, if you look at the first quarter
data, that even other emerging markets that create quite a bid with China has shown a lot more resilience than China has, so as you pointed out that
the Chinese economic growth has disappointed so far this year.
But for the rest of the world, the US is well-known, but even other emerging markets from India to Brazil, Indonesia to Poland, in all of these
countries, growth is actually surprisingly on the upside.
So I think that the rest of the world has begun to readjust to a more inward China, to a world which is less dependent on China and so therefore,
the negative impulse coming from the Chinese growth disappointment is far less than what it used to be.
ASHER: Ruchir Sharma live for us there, thank you so much.
Greek authorities say they may now know what caused a migrant vessel to sink Wednesday off the coast, a sudden shift in weight onboard seems to
have capsized the boat killing at least 78 people. That death toll is almost certain to rise. And while we don't know exactly how many people
there were on board, survivors say that number as well in the hundreds.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE (through translator): All women died, all children died because women stay all in one room, it is impossible they would survive,
impossible, so difficult. All women and their children died.
Also plenty of Egyptian youths died. A lot of people, 700 people on the boat is a big number. All were in the boats lower level, 400 Pakistanis and
the 350 others are Egyptian and Syrian.
(END VIDEO CLIP)
ASHER: Melissa Bell is following this tragedy in Kalamata, Greece, joins us live now, and there is that fear that he touched upon there that there may
have been hundreds of people trapped below deck and at this point, very slim chances, Melissa of finding any more survivors.
MELISSA BELL, CNN CORRESPONDENT: No, we'll be coming up in just a few hours' time, Zain, to the 48-hour mark, very little chance that any of
these people might have survived for that long in an area where we've been seeing strong winds, difficult conditions, and that is one of the deepest
parts of the Mediterranean Ocean, 4,500 kilometers deep. It is very, very deep and unlikely that people will have survived.
What we do understand from authorities, you mentioned that they had an idea of what might have happened is that simply the boat might have listed at
one point, they think that it will have sunk between 10 to 15 seconds. That's how quickly it went down.
What we know happened is that for a while, there were the boats that tried to bring them food, water, perhaps they rushed to one side or the other
boat to try and get some of that help. But the real question, of course, is why the Coast Guards, the authorities in charge of these kinds of rescue
operations didn't do more and sooner.
BELL (voice over): A dramatic rescue at sea, the Greek Coast Guard pulling a group of people to safety, the lucky ones, survivors of yet another
catastrophe on the deadliest migrant crossing in the world, the Mediterranean.
Somehow 104 people managed to leave this overcrowded fishing boat alive, but hundreds that you see here did not, most still missing in the deepest
part of the Mediterranean Sea just 50 miles off the Greek Coast.
Onshore, medics rush to preserve the lives of those that survived, their bodies in trauma after hours in the water. All are men. Aid workers tell me
others were unable to get out.
IPPOKRATIS EFSTATHIOU, SOCIAL WORKER, IASIS: What we are getting from the people is that, mostly the kids and the women they've been like locked
inside the basement of the boat.
BELL (voice over): As the search for bodies continue, there are questions about how long it took to try to help these people. The vessel started out
from Libya, heading towards Italy, and called for help on Tuesday afternoon one charity has said.
It claims the authorities knew for hours that the vessel was in peril, but that a rescue operation was "not launched until it was too late."
At this stage, there is little hope for more survivors will be found. Those that did make it are deeply traumatized and their future in Europe, far
BELL (on camera): Now amongst those who survived, tonight, we're hearing Zain, from Greek authorities that nine Egyptian men have been arrested
accused of being those responsible for the people trafficking, the smugglers, the people who brought them on the boat and profited from them.
But of course, they will have been on the boat. They are not the bigger players left behind in Libya that have been organizing these kinds of
treacherous crossings. Still, for the Greek authorities something of a breakthrough that they've been able to identify them, the real question of
course, the broader question, Zain, is what these tightening of borders around countries like Italy and Greece, and soon the whole of the European
Union since the EU is moving towards the kind of migration policy compromise that Greece and Italy have long been calling for, what that is
going to mean for the very many desperate people who continue to make these trips each year -- Zain.
ASHER: Heartbreaking for families of those who perished. Melissa Bell live for us there, thank you so much.
Joe Biden is going after so-called junk fees, those unexpected extra costs. He just announced that Live Nation and Ticketmaster will start displaying
those charges upfront. That's next.
ASHER: The Biden administration is cracking down on hidden ticket fees. Earlier, Mr. Biden announced that Live Nation and Ticketmaster will now
display all fees up front as government pressure on the industry increases.
In the US, hidden charges are often tacked on late in the online checkout process. Mr. Biden said that more needs to be done.
(BEGIN VIDEO CLIP)
JOE BIDEN, PRESIDENT OF THE UNITED STATES: These are just the latest private sector leaders who are responding to my call for action. And I'm
asking their competitors to follow suit and adopt an all-in upfront pricing as well.
This is a win for consumers in my view, and proof that our crackdown on junk fees has real momentum. But there's more to do to address the problem
of online ticketing.
(END VIDEO CLIP)
ASHER: Vanessa Yurkevich is with me now.
So if there's more transparency, will this eventually lead to people ending up paying less -- Vanessa.
VANESSA YURKEVICH, CNN BUSINESS AND POLITICS CORRESPONDENT: Not necessarily less upfront. It is going to be at the consumer's discretion what they do
about the all-in ticket price they see up front, but we heard President Biden talk about this at the State of the Union and this is him saying that
he is making good on his promises having Ticketmaster and Live Nation voluntarily agree to show the ticket price, the fees, and the taxes all up
front before you make that purchase, but he wants to go further.
He has helped to put forward the Junk Fee Protection Act. He really wants this to be widespread. He wants to target excessive concert fees, he wants
to target airline fees, early termination fees, and surprise destination fees, something you might see later on your cruise, an extra fee come
But let's talk about what this actually looks like, so we did a little digging and we looked up Beyonce concert tickets in New Jersey on July
29th. The initial price we found was about $300.00. But then when we got to check out, taxes and fees made it $369.00.
We also saw this when we looked at different hotel resorts, resort fees can be hidden. So we found two-night stay in Tucson $361.00, but then when you
saw the resort fee come into play, the taxes, $480.00 for those two nights, and we're seeing this a little bit with Airbnb as well. We looked at Miami
Beach from August 1st through the 6th, before taxes for those nights, $482.00, and then after taxes $530.00.
And so what this means is that when families are trying to budget, trying to figure out how much they're going to spend, they may think that they're
seeing one price up front, but then by the time they get to check out, they are seeing a different price.
And what President Biden wants to do is put all of those fees up front, Zain, so that Americans can make informed decisions about how much budget
they can allow to these experiences and also really understand exactly how much things are going to cost at the end of the day.
President Biden also talking about how he was able to reduce $5.5 billion a year in overdraft fees, and that he was able to reduce bounced check fees
by $2 billion.
So this is really a kitchen table issue for President Biden. He talked about it months ago, and this is him really trying to crack down to help
everyday Americans really understand what they're paying for at the end of the day -- Zain.
ASHER: All right, Vanessa Yurkevich, live for us there. Thank you so much.
Exclusively here on CNN, a new survey of business leaders finds a staggering number of them are worried about artificial intelligence, 42
percent of chief executives surveyed at the Yale CEO Summit said AI could potentially destroy humanity five to 10 years from now. It is short of a
majority, but a telling indication of how much fear and uncertainty surrounds this technology and its future implications.
Matt Egan has been reporting on this and joins us live now. So Matt, just walk us through more specifically what CEOs are concerned about here?
MATT EGAN, CNN REPORTER: Zain, this is the scariest CEO survey that I think I've ever seen, right? Normally, we're interested in whether CEO see a soft
landing or a hard landing in the economy. The stakes are just a bit higher here.
Yale asked over a hundred CEOs a simple, but scary question: Does AI have the potential to wipe out humanity? And the good news, relatively speaking
is that 58 percent said no, no way. That's not going to happen.
But what was really startling for me to see is that you had eight percent who said yes, this could happen potentially five years from now, and 34
percent who said yes, potentially in 10 years.
So here you have 42 percent of CEOs saying that AI poses an existential threat not decades from now, but in the not too distant future.
Yale professor, Jeff Sonnenfeld, he told me that he found these findings to be "dark and alarming." Now, none of this of course, is to say that AI
itself is evil. We know it has enormous potential here to transform health care and education and transportation. I think anyone who uses ChatGPT for
just a few minutes can see the potential here.
But we are hearing more warnings from business leaders and tech experts. We even heard from Geoffrey Hinton, the godfather of AI itself, who came out
and said that eventually AI could get so smart that it can potentially manipulate humans or even override restrictions that humans put in place.
So clearly, Zain, there is a lot of concern around AI.
ASHER: To just -- I mean, it's interesting because there is so much concern, we saw the letter that was signed just about a month or so ago.
And now as you point out, many CEOs are concerned about AI's ability or potential rather to destroy humanity essentially. What are they doing to
stop it? What is being done to stop it if there is this much concern then?
EGAN: Well, Zain, first we should note that while there is this ongoing debate over these doomsday scenarios around AI, there are also near-term
issues around what AI means for potentially turbocharging misinformation and fraud. What does it mean for job loss? And those are things that are
The business leaders and academics and law makers, they are divided over for how to address any of these threats around AI.
There are some who worry that Washington is going to overregulate AI, potentially stifling competition and maybe giving China and other countries
a leg up in this AI arms race.
But some tech leaders, even some in the AI community, they are urging lawmakers to install some guardrails.
We've heard from ChatGPT founder, Sam Altman recently and he was basically pleading with Congress to regulate this space because he is concerned about
the risks here.
So Zain, you know, the stakes here are enormous. We know that AI has the potential for a lot of good, but also, there is a lot of risks here, and
it's very important that lawmakers and regulators get this right.
ASHER: Absolutely. Matt Egan live for us there. Thank you so much.
The US government says several of its agencies have been hit by global cyberattacks. In a statement to CNN, cybersecurity officials say they are
working urgently to understand impacts and ensure timely remediation. The attack apparently exploits a vulnerability in widely used software.
The former CEO of Cisco says cyber attackers are constantly probing and that government agencies need to constantly evolve. In response, John
Chambers is now the CEO of JC2 Ventures, he spoke to Anna Stewart earlier at the VivaTech conference in Paris. He told her why having a strong
defense is important.
(BEGIN VIDEO CLIP)
JOHN CHAMBERS, CEO, JC2 VENTURES: I think every agency especially the federal governments and especially defense, need to be evolving constantly
on their cybersecurity capabilities.
So if you had the same software, you're by definition, exposed to the same type of issues. So, it's going to be an ongoing innovation engine, if
you're a positive person, which I am, and the agencies have to constantly evolve. If they don't, or they quit investing, or they don't get their
various cybersecurity groups to talk to each other, there is a real problem.
My average federal government agency probably has a hundred cybersecurity vendors within their environment, which weren't designed to work together.
And so you require human intervention to connect the dots.
The rogue nation states or the organized crime will probe and then they will found a weak spot and then use that weak spot to attack.
(END VIDEO CLIP)
ASHER: Former British prime minister, Boris Johnson is accused of misleading Parliament over the partygate scandal. We'll have more on the
bombshell report from the House of Commons committee, that's next.
ASHER: Hello everyone, I'm Zain Asher. There's more Quest Means Business in a moment when the U.S. Justice Department is reportedly getting ready to
investigate the mega merger between Liv Golf and the PGA Tour and Quantis' new 18-hour flight would take a toll on even the most seasoned traveler and
Richard Quest puts it to the test and speaks to the CEO before that though, the headlines at this hour.
South Korea and Japan say North Korea has fired at least two missiles off it's eastern coast. Pyongyang had threatened the response to what you see
here. Joint military drills by the U.S. and South Korea, Seoul, Tokyo and the U.S. are condemning the missile launches.
A New York grand jury has indicted the subway rider who put a chokehold last month on a homeless street artist. Jordan Neeley, the man in the
chokehold, was later pronounced dead at a hospital. The Manhattan D.A. says Daniel Penny was indicted for manslaughter. Penny said Neeley had been
shouting and threatening passengers.
And the impact (inaudible) baring down as Cyclone Biparjoy is making landfall in western India tonight. The slow-moving storm already brought
tidal surges to coastal areas. It's expected to cause widespread flooding while devastating the local infrastructure.
A scathing report from British lawmakers says the former prime minister Boris Johnson deliberately misled parliament about parties held at 10
Downing Street during COVID lockdowns. Johnson resigned as a PM last week ahead of it's publication. The damage to his legacy and popularity may
already be done. Scott McLean has more on this from London. So Scott Boris Johnson resigning last week as MP, that limits how much he can be
sanctioned. For his part he's saying that the committee is politically biased.
SCOTT MCLEAN, CNN INTERNATIONAL CORRESPONDENT: Yes, so what was not up for adjudication here is whether or not lockdown rules were breeched during
these gatherings or events or parties or whatever you want to call them, during the time where COVID lockdowns and COVID restrictions were
What is up for scrutiny or what was up for scrutiny by this committee was whether or not Boris Johnson deliberately misled parliament and there are
plenty of examples where Boris Johnson made statements about those lockdown parties. Here's just one of them, watch.
(BEGIN VIDEO CLIP)
UNKNOWN: As millions of people were locked down last year, was a Christmas party thrown in Downing Street for dozens of people on December the 18th?
BORIS JOHNSON, FORMER PRIME MINISTER OF GREAT BRITAIN: Mr. - Mr. Speaker, what I can tell the right honorable gentleman is that - is that all
guidance was followed completely during number 10.
(END VIDEO CLIP)
MCLEAN: So that Christmas party was actually one of six parties, or six events or gatherings that the committee looked like one of them was Boris
Johnson's birthday party. Some of them were leaving drinks or thank you drinks. One of them had 200 people invited to it who were told to bring
their own booze.
The committee who decided this and came up with this report that was more than 100 page long was made up of seven people. Four of them, by the way
Zain, were from Boris Johnson's own party and ultimately they found that Boris Johnson did in fact mislead parliament and he had a pretty loose
interpretation of his own rules.
The rules that he helped to write. For instance, he continues to insist that despite the lockdown rules at the time that these social gatherings
were, in fact, essential work functions. So the committee actually wrote that some of Johnson's denials were so disingenuous that they by their very
nature were deliberate attempts to mislead.
They also wrote this in part. I'll read a segment of it. It says the contempt was all the more serious because it was committed by the prime
minister, the most senior member of the government. There is no precedent for a prime minister having been found to have deliberately misled the
House. He misled the House on an issue of the greatest importance to the House and to the public and he did so repeatedly.
He declined their invitation to reconsider his assertions that what he said to the House was truthful. He released, Johnson himself, having released
his own statement on Friday when he resigned as MP released another one in response to the official release of this report where he said, in part, for
the committee now to say that all such events, thank you's and birthdays were intrinsically illegal is ludicrous.
Contrary to the intentions of those who made the rules including me and contrary to the findings of the Met - meaning the Metropolitan Police, and
above all I did not for one moment think they were elicit at the time or when I spoke in their common.
So as you mentioned Zain, the sanction here which has been suggested or recommended is 90 days suspension as a sitting MP which would potentially
or likely trigger a buy election for his own seat and potentially put him out of office for much longer. It's kind of a moot point here because he is
already resigned his seat from office but also sent plenty of signals that perhaps this is not the end.
ASHER: Scott McLean live for us. Thank you. The Wall Street Journal is reporting the U.S. Department of Justice will investigate the latest anti-
trust concerns in the world of professional golf. The announcement last week that the PGA Tour would partner with the Saudi backers of a rival
league, Liv Golf.
Two parties who already in an anti-trust dispute with one another seems to have gotten regulators attention. Brian Todd has been following this news
from Washington and joins us live now. So Brian, just walk us through the specific concerns as to whether or not these two groups may have indeed
violated anti-trust laws. Walk us through that.
BRIAN TODD, CNN CORRESPONDENT: Well Zain, this was a merger that was controversial from the get go and now it is even more fraught with
potential problems. As you mentioned the Wall Street Journal now reporting that the Department of Justice is - has notified the PGA Tour and Liv Golf
that it is looking at this merger for potential anti-trust violations.
Now when I spoke to our legal analyst Shan Wu about specifically what they could be looking at, he kind of boiled it down to me in simple terms. He
said basically the - the whole point of having an anti-trust system in the United States is that if you have an industry with major players that merge
together, it basically knocks all the competition out of the room.
And according to our laws in the United States and the way the U.S. economy is set up, it's set up so that the most people as possible can compete in a
given sport or given business arrangement, or business situation. So that's what they're going to be looking at, basically at it's heart did this deal,
kind of, knock all the competition completely off the board and according to the Journal, they - they site something very interesting.
They say that anti-trust lawyers have been pointing out that a potentially problematic aspect of this deal are statements like the one that the PGA
Tour Commissioner Jay Monahan made earlier this month, when he said that the deal would be good for the tour to quote, "take the competitor off of
the board to have them exist as a partner and not an owner" end quote, that was from the PGA Tour commissioner.
So when he says things like that, openly saying that this is designed to, kind of, merge forces and take all the competition out that's what the
Department of Justice may be looking at, but also according to our analyst Shan Wu, it's possible - possible that the Justice Department will be
looking at the aspect of this where the PGA and Liv, if they - if they merge together and they hold tournaments together.
A lot of tournaments are played near military bases and that could be looked at just from the status of a potential national security concern, so
and I asked Shan flat out could - could all of this maybe kill this merger. He said it conceivably could, now of course, you know, the PGA and Liv will
They'll - they'll litigate this but they're already involved in so much litigation over all of this Zain that, you know, it's probably not
something they - they need right now but if they Department of Justice is going, kind of, you know, bring them forth and, kind of, rake them over the
coals for this it's going to be tough for them to negotiate this process.
ASHER: Yes, as you point out this was a controversial deal - merger from the get go. Brian Todd (inaudible) that. Thank you so much. (Inaudible)
says it's found new ways to reduce jet lag. Jet lag as it prepares to launch the world's longest flight. Alan Joyce CEO is also stepping down and
has told Richard Quest why now is the time to go.
(BEGIN VIDEO CLIP)
ALAN JOYCE, CEO QANTAS GROUP: And I think 15 years, the company's in a great position where we've now set ourselves up to do projects (inaudible)
that will change international travel. We've set ourselves up for the best domestic position of any airline, taken only the best of America around the
(END VIDEO CLIP)
ASHER: Yellow-crested cockatoos were once abundant in the jungles of Indonesia but the exotic pet trade ravaged their population and today's
Call to Earth, we visit a research scientist in Hong Kong where the bird has found an unlikely refuge. Learn about the technique she believes can
help save the critically endangered species. Take a look.
(BEGIN VIDEO CLIP)
DR. ASTRID ANDERSON, HKU SCIENTIST: This species of cockatoo that we have in Hong Kong is actually very rare in the wild. Oh, there's one flying.
They number only about 2,500 in the wild now according to the IECN and here in Hong Kong we have almost 10 percent of the global population.
They are this iconic species that is critically endangered but is surviving in one of the most dense, urban, environments in the world. I'm Dr. Astrid
Anderson. I'm a post-doctoral researcher at the University of Hong Kong and my main focus area is traded species, urban biodiversity and the yellow-
crested cockatoo population here in Hong Kong.
Hong Kong is a throughfare for legal wildlife trade and that provides a cover for the illegal wildlife trade to operate in parallel. You're still
allowed to trade a cockatoo that has been bred in captivity, however it's very difficult to tell if the cockatoo in a shop has indeed come from a
farm as opposed to being poached in the wild
ERIKA CUELLAR, BIOLOGIST: To combat this Anderson developed, a method using staple isotope analysis that can tell the difference between captive bred
and wild cockatoos.
ANDERSON: Generally, captive animals have a different diet from wild animals and this you can tell from the chemical composition of their fur,
feathers, claws and so on.
CUELLAR: As part of her PhD research in 2017 and 2018, Anderson conducted weekly bird surveys of Hong Kong's local bird market.
ANDERSON: I often would see yellow-crested cockatoos for sale. There is no record keeping for the home breeding, so we don't know if any and how much
home breeding of yellow-crested cockatoo is actually going on here in Hong Kong.
CUELLAR: According to government authorities, there's currently no license for breeding yellow-crested cockatoos in Hong Kong.
ANDERSON: This forensic tool should be applied to ensure that these cockatoos being sold in the market are in fact from home breeders.
CUELLAR: Now, Anderson is conducting genetic analysis on the birds to establish where they came from, how long they've been here and whether they
could help the dwindling numbers in Indonesia.
ANDERSON: The population in Hong Kong could potentially have an important role in the conservation of yellow-crested cockatoos worldwide as a genetic
reservoir or as a back-up having been removed from the pressures that are faced by the Indonesian cockatoos.
In Hong Kong we think of concrete jungles, skyscrapers, but we also have diverse flora and we have many reptile species, bird species and the
cockatoos they've been able to persist in this highly urbanized environment and they're a very rare species. So I think that that sends a message of
hope about survival of species in general on this planet.
(END VIDEO CLIP)
ASHER: Let us know what you're doing to answer the call with the hashtag calltoearth. We'll be right back.
ASHER: Qantas says it's found ways to reduce jet lag on ultra long haul flights. Studying passengers on three journeys longer than 19 hours
researchers found the timing of food and exercise and the use of light and temperature helped cut jet lag by up to two days. Richard Quest was onboard
one of these test flights from London to Sydney in 2019. Here's how he find - found being in the air for so long.
(BEGIN VIDEO CLIP)
RICHARD QUEST, HOST OF QUEST MEANS BUSINESS: 4:30 in the morning when check-in begins.
UNKNOWN: Are you checking any baggage in?
QUEST: The QX7879, the flight from London to Sydney. Rolling, we lift off before dawn and head east and our first sunrise. On this double sunrise
flight, it's a rare aviation event but the same flight to see two sunrises across different days. Even the Qantas CEO takes time to capture the
moment. This flight is all about research for both crew and passengers. Learning how our bodies handle ultra long haul.
UNKNOWN: Really gives us a good indication of being (inaudible) sleep behavior at different times.
QUEST: And that means exercise. Luckily the planes empty. This flight is an airline CEO's nightmare, rows and rows of empty seats. There have to be
empty. If they were filled with passengers we'd never get to Sydney. The flight is also about research with the pilots and their brain pound. Qantas
will have to convince regulators to allow pilots to be on duty for up to 24 hours.
UNKNOWN: I'm wearing an EAG monitor. This (inaudible) sitting in the Atlantic. To operate it, I'll switch to another one for night.
QUEST: Our first meal is crafted to promote sleep.
UNKNOWN: So the way we present the menu is to really support the sleep cycles and the (inaudible) throughout the flight. We've got the high GI
bread and recurring that we've have dishes that have good quality protein and that helps to encourage the production of serotonin and melatonin.
QUEST: Halfway there and over China, some are sleeping others are not. I'm just enjoying the experience. Our second sunrise comes as we pass the
Philippines, it's thought less than 1,000 passengers in total l have experienced the double sunrise. We're flying over the South China Sea and
we've been airborne for some 12 hours and we still have the equivalent of London to New York to do. Qantas has put a lot of money and effort into
ultra long haul research, far more than other airlines who've similar routes. Alan Joyce explains why.
ALAN JOYCE, QANTAS CEO: You can't do the type of studying that we're doing on regular flights. The pilot's going to be wearing headgear, they're going
to be testing (inaudible), and we can't do that on regular flights that you can do on these delivery flights.
QUEST: Before long we're on final approach. This flight's gone much faster than I expected. Not exactly sure what I've done for all these hours. We
land in Sydney.
QUEST: We've broken the record. Yes, we've made history. So it looks like we've done it. The longest flight in the world in both time at over 19
hours, 19 minutes and distance well over 10,000 miles. Two records, one flight.
(END VIDEO CLIP)
ASHER: Since that flight, Qantas put a pandemic induced pause on Project Sunrise. Now it's gearing up to launch the world's longest flights in 2025.
Today the airline unveiled what the economy cabin will look like on the new A350's flying direct from Australia to New York and London.
The seats have one extra inch of leg room. The cabin will have wellness zones giving passengers more space to move, getting Project Sunrise off the
ground will be one of the final acts of CEO Alan Joyce. He's preparing to step down in November at the Iota Conference in Istanbul. Richard Quest
asked him why he's calling time.
(BEGIN VIDEO CLIP)
JOYCE: Well, a couple of things Richard, one when we were in the middle of COVID I did agree to stay for three years to help the company get through
that unbelievably difficult period. And as you know like every airline, we got to within 11 weeks of bankruptcy, so for - for me and the shareholders
we raised equity on the base of the - and - and the shareholders wanted to stay for three years.
I may meet that at the end of this year. Again I felt being in the job for 15 years as the CEO Qantas, five years before that as the CEO of JetStar,
20 years as the CEO of an airline and I think now's the time for me to go on and do other things. And I want to try to do other things that are
different, I'm still young enough to do that and I think 15 years, the company's in a great position where we've now set ourselves up to do
Project Sunrise that will change international travel.
We've set ourselves up for the best domestic position of any airline. I think in any domestic America around the world. We've got a loyalty program
had us making record profitability, with our freight business is making record results and a group is going to make record results. The best profit
it's ever done this year, nearly $2.5 billion so it's a good time to go out on a high.
QUEST: I read one article that, sort of, described your legacy as mixed which I didn't quite fully understand because I think the general view is
that a tremendous success. You saved Qantas on several occasions, but I - but if you take back to 2011 though, that was the hardest in a sense,
because the pandemic, you can really, you know, you're -- you're fighting a fire that you didn't start. But in 2011 when you shut the airline, that was
JOYCE: It -- it was but again it was a fire that we didn't start because we had industrial action going on from three unions, which were trying to make
us give commitments that I think would have bankrupt Qantas.
JOYCE: Instead of kicking the can down the street, which may be a lot of CEO's would have done. We decided to make a stand to do what was right for
the company and not give in to the bullying and the outrageous demands, and they were outrageous demands.
And the only way then as a solution was we had to ground the airline and lockout the workforce to force our arbitration which essentially happened
and we won in arbitration, which saved the airline because (inaudible) out to do the restructuring that was needed for Qantas to actually regenerate
itself and to start growing again, which is what happened between (inaudible) and before COVID.
QUEST: You - but it was dramatic.
JOYCE: It - it was a dramatic decision.
QUEST: It was a huge, huge hit personal
JOYCE: Yes, but it was - it was - it was interesting Richard because it was polarizing and it was a lot of people that said - had said to me walking
down the street and at - at speeches were saying that - that it was the right thing to do. And there were other people that didn't feel it was but
it was one of those decisions that was polarizing but at the end of the day anybody in business, anybody that were going through what we would have
done would have known it was a hard decision. It was a tough decision but one that was necessary.
QUEST: Was 2011 harder than COVID in a sense of - in a sense that you had to make a decision in 2011? And with COVID you were reacting to something
that was happening around you.
JOYCE: But it was a lot of hard decisions in COVID as well, probably harder in a lot of ways, because it was outside, you know, we - we had revenue
switched off. We had 11 weeks to survive. We had to make nearly 1/3 of the workforce, which most airlines had to do, redundant. I had to make friends
that were working in head office that I've worked with for nearly 20 years, that you (inaudible) have it to make them redundant.
That was hard because it was outside of our control and you didn't know what it was going to be like at the end of the tunnel and it was a lot
easier in hindsight for a lot of people. But we didn't know there was going to be a vaccine, we didn't know the vaccine was going to be effective.
We didn't know that borders were going to reopen as fast as they did and we didn't know that the (inaudible) was going to rebound as fast as it did,
because when you were in the middle of 2020 there was no light at the end of the tunnel and it looked like we're going to have to cope with this for
a very long time.
(END VIDEO CLIP)
ASHER: There are moments left to trade on Wall Street. We'll have the final numbers and the closing bell right after this.
ASHER: U.S. markets are higher a day after the Fed announced a pause in interest rate hikes. The Dow, let's see there, is up slightly, more than
400 points. A rare IPO on Wall Street, the Mediterranean restaurant chain, Cava, went public today.
It was priced at $22 a share this morning. The new stock has soared and set to close almost 100 percent higher. That is QUEST MEANS BUSINESS. I'm Zain
Asher. The closing bell is ringing on Wall Street. "THE LEAD" with Jake Tapper starts right now.