Return to Transcripts main page
Quest Means Business
Putin: Russia Will Keep Testing New Ballistic Missile; Pam Bondi Replaces Matt Gaetz As Attorney General Pick; Six Tourists Die After Drinking Suspected Tainted Alcohol; Celebrating The Legacy Of Travel Author Arthur Frommer; Civil Jury In Ireland Awards McGregor Accuser $257,000; Sean "Diddy" Combs Tried To Get Out On Bail Again. Aired 4-5p ET
Aired November 22, 2024 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:08]
JULIA CHATTERLEY, CNN INTERNATIONAL HOST: End of the show there, ringing the closing bell this Friday. Barrick Gold's CEO and the stock market is
ending in the green after a pretty choppy week. Just the NASDAQ underperforming. Still got NVIDIA under a bit of pressure today.
Those are the markets, and these are the main events.
Vladimir Putin says Russia will continue to test its new hypersonic ballistic missile, ahead of a hotly anticipated IPO. The Klarna CEO joins
me to talk about adding Google and Apple Pay to the service.
And saying goodbye to a true pioneer of budget travel. A tribute to Arthur Frommer.
Live from New York, it is Friday, November 22nd. I am Julia Chatterley, in for Richard Quest and this is QUEST MEANS BUSINESS.
And a good evening once more.
We begin with the war in Ukraine, and a stark message coming from Russia. President Vladimir Putin says Moscow will continue testing a new hypersonic
ballistic missile in combat. The weapon was fired on the Ukrainian city of Dnipro on Thursday.
It has been a week of dangerous escalation. Kyiv says its air defenses shot down 64 Russian drones today alone. The nation's parliament did not meet
today due to the risk of missile strikes. President Volodymyr Zelenskyy says Ukraine is now discussing new air defense systems with its allies.
Nick Paton Walsh is in Kyiv for us.
Nick, Vladimir Putin threatening anyone who allows Ukraine to fire their weaponry at and into Russia, that means the United States, the UK and
France, but at the same time saying they can continue to develop these hypersonic ballistic weaponry that they say at least these defenses cant
contain.
NICK PATON WALSH, CNN CHIEF INTERNATIONAL SECURITY CORRESPONDENT: Yes, I mean look, were essentially looking to answer two questions about the
strike that happened over Dnipro yesterday is what exactly was fired and we appear to know some of the answer, a hypersonic non-nuclear missile that
was capable of firing multiple separate warheads down on one particular target, that seems to be a general assessment shared by everybody.
Ukraine Defense intelligence officials suggesting this may be something that Russia has developed as a prototype, and they think they only had two
of them as of October and they hope that's it.
The second question is ultimately Russia able to fire this again. Now, Vladimir Putin's comments that they are able to test this in combat again
is, of course, trying to amplify the message of that original use over the Dnipro just yesterday.
I think this is essentially about Russia trying to show that it has extra technological prowess in its toolbox, that it hasn't reached for until
yesterday before trying to generate a sense of deterrence against the West, where it potentially feels emboldened to allow Ukraine to fire the ATACMS
and the storm shadows and the scalps that have been hitting targets inside of Russia over the past days.
But the ballistic missile threat against Ukraine has been consistent for the last year and been indeed increasing some of it thanks to the
contribution of North Korea, and we've learned that about a third of the last year's ballistic missile attacks have been because of North Korean
missiles being used, much of which are dependent upon western supplied technology to function.
Here is what we know.
(BEGIN VIDEOTAPE)
WALSH (voice over): The scramble for the dead or the living, horrifically commonplace in Ukraine. Yet, this series of homes in Kyiv turned to rubble
by something other, not Russian, but a North Korean supplied ballistic missile and made able to fly here to cause this barbarism, killing a man
and his four-year-old son by circuitry from the United States.
Ukrainian officials told CNN, ballistic missile attacks by Russia were rising fast, 194 so far this year and about a third of them, at least 60,
were using North Korean KN23s.
But these crude missiles, part of growing aid as North Korean troops also come to Russia, rely on a sophistication smuggled into the Hermit Kingdom,
one on display by Ukrainian investigators at this Kyiv warehouse of missile fragments.
It is a house of horrors, drones that haunt the night skies, rockets that tear down lives. They pick through the dust to learn how the killing
machines work. Here, rebuilding a Shahed Iranian drone circuit.
WALSH (on camera): Parts from a Kinzhal missile, a Shahed Iranian drone and a Russian Orlan reconnaissance drone, all things Ukraine has been subjected
to for many months, but key, these North Korean KN-23 missiles rely on, they say on components from the United States and the Netherlands.
[16:05:10]
WALSH (voice over): This box containing dozens of small bits of circuitry made by a household names in the USA or Europe subject to sanctions
globally, but smuggled often via China to North Korea.
WALSH (on camera): When you open all this up and find American components, how do you feel?
(MALE speaking in foreign language.)
TRANSLATION: Like sanctions are failing.
(ANDRIY KULCHYTSKYI speaking in foreign language.)
TRANSLATION: All the electronics are foreign in origin. There is nothing Korean in it. The only thing Korean is the metal, which quickly rusts and
corrodes.
WALSH (voice over): The journey the chips and circuits take to Russia may lead through North Korea, even China as a middleman, though ultimately they
are US design and made.
(OLEKSANDER VYSIKAN speaking in foreign language.)
TRANSLATION: The chips are most often from the United States, but the country of manufacture can be China, Malaysia, Taiwan. However, it means
that the headquarters is in the United States.
WALSH (voice over): As the toll from these missiles deepens, Ukrainian officials say the Western firms need to be held accountable.
From Thursday's Russian launch of a new weapon to their growing use of purloined North Korean missiles, the global reach of this war grows.
(END VIDEOTAPE)
WALSH (on camera): I should point, it isn't just those ballistic missiles that North Korea is contributing as troops, of course, as well. And we have
been hearing today indications that in Mariupol, the southern port city occupied by Russia, a Ukrainian security source tells us that they say they
have evidence that there are North Korean personnel there in Russian uniform, not infantry, but potentially technological advisers.
And there separately are indications from Ukrainian military sources they believe there are North Korean troops in the Kharkiv region, too. A sign,
as I said there, of the increasing global scope of this war and is important to remind ourselves that literally a week ago, German Chancellor
Olaf Scholz rang Vladimir Putin trying to break a two-year isolation of the Kremlin head from major western leaders with a phone call suggesting
diplomacy.
And in literally a week, we are now seeing US supplied weapons fired by Ukraine into Russia and Russia firing back essentially what they consider
to be a high tech weapon, normally of a design you consider to use a nuclear payload to send a strong message to Washington, and even required a
30-minute heads up via a phone call that Russia still has tools it can reach to in its arsenal that might upset what I think NATO consider to be
their superiority here.
CHATTERLEY: Nick, that was a fascinating report. I would love to hear what the US State Department has to say about that, to your point, you've got US
weaponry going in one direction and the components from American-made manufacturers and the weaponry on the other side.
Brilliant reporting, questions certainly need to be asked.
Nick Paton Walsh in Kyiv, thank you.
Now, sources say Donald Trump is expected to offer Kelly Loeffler, the Secretary of Agriculture job. Loeffler briefly represented the state of
Georgia in the US Senate. She was also a major fundraiser for Trump's presidential campaign.
Meanwhile, Matt Gaetz says he won't return to Congress after a short-lived bid to become US Attorney General. Gaetz said the likely confirmation
battle had become a "distraction" and praised the president-elect's new choice, Pam Bondi.
She is the former attorney general of Florida and she also advised Donald Trump during his first impeachment trial.
Tom Foreman is in Washington for us tonight.
Tom, good to have you with us.
Attention has clearly shifted from Matt Gaetz to his replacement and perhaps some of the other picks that could face and are facing difficult
questions.
But what remains quite fascinating to me about what we have heard now since over the Matt Gaetz choice, is the fact that it seems that the president-
elect said to him, look, you're going to have a problem in the Senate, so there is an element of pragmatism to be applied here. Look, these are our
picks, but we will find a backup very quickly if it doesn't work.
TOM FOREMAN, CNN CORRESPONDENT: Yes, there was a sense that Pam Bondi might have been Trump's first pick at one point. That is not what happened. And
he is, you know, notably mercurial about such things in the moment he ended up picking Gaetz and Gaetz ran into all of these problems.
But he knows Pam Bondi, has been around here a long time. She's got some pretty good ties in the Trump circle of the Republican Party, which
increasingly is the entire Republican Party.
So there are plenty there who see her as a more normal pick than Gaetz in that she has experience as attorney general of the state of Florida, huge
state here, eight years in that. She has had experience as a prosecutor. She knows her way around the law. In certain ways, Trump trusts her on
managing the law in a lot of ways.
That said, she has also been an election denier, and Julia, she very notably has said that she expressed the idea of carrying out Trump's quest
for revenge if in office. She has said, those who investigated him in the Justice Department will investigated him in the justice department will be
investigated, and those who prosecuted him will be prosecuted.
[16:10:20]
That sends a bit of a chill through the political atmosphere here for everybody outside of Trump world -- Julia.
CHATTERLEY: Yes, I saw the incoming Senate Judiciary Chair, Chuck Grassley called the attorney general pick here well-regarded and experienced on a
post on X. So I guess, the suggestion is she would be easier to get a confirmation than Matt Gaetz was. We shall see.
Speculation rife. We are still waiting for a Treasury Secretary pick. I personally don't mind time being taken over this decision because it is
vitally important to get the right person.
FOREMAN: Yes, and again, the question is what will the metrics be for Donald Trump picking this person? He has been picking some people seemingly
because he likes how they look on TV, which is not a very good metric to work with, and what he is considering right now are some people who have
been involved in equity and bank management, that sort of thing, big time financial people who seemingly would know their way through it.
Although, in some ways, there is a question if some of them might put their thumb too much on the scales of letting billionaire big business do
whatever it wants to do. But I agree with you, Julia, it is very important position. The question is, what will he come up with?
And notably, at least one of the candidates he is looking at here, kind of has backed things that Trump would not agree with, being sort of like anti-
tariff for example. And Trump says, oh, tariffs are the key to everything. We are going to do it all with tariffs, so it will be very interesting to
see where he comes down on that.
And as you noted, he still has some landmines to step around with some of his other nominees right now --
CHATTERLEY: Yes.
FOREMAN: -- who have -- they have issues. They have issues. The question is will the Senate say not so big to make us stop the incoming president.
CHATTERLEY: Yes, the anti-protectionist is the Kevin Warsh. I think that's who you're talking about.
FOREMAN: Yes.
CHATTERLEY: Former Fed governor, yes. You've got to find someone who is on board with crypto as well, of course, and that is going to be another
hurdle for all of these guys.
FOREMAN: Oh, yes.
CHATTERLEY: Exciting times.
FOREMAN: Yes.
CHATTERLEY: Tom Foreman, thank you sir.
FOREMAN: You're welcome, Julia.
CHATTERLEY: Now, Gaetz wasn't the only Trump choice facing a tough road to confirmation. Defense Secretary Pick Pete Hegseth is dealing with a
backlash from a sexual assault allegation, that's on top of concerns about his broader qualifications. And some Republicans raising concerns, too,
about Tulsi Gabbard, critics saying the pick for National Intelligence director may sympathize with US adversaries.
Republican strategist, Doug Heye is with us now.
Unique times, let's call it that. A unique world and a unique administration. What do you make of what's going on, first and foremost?
DOUG HEYE, REPUBLICAN STRATEGIST: The old phrase, may you live in interesting times is more of a curse than it is just a proverb. But look
what we see is there is sort of two tracks here for Donald Trump appointees. Most of them will get in without much of a problem. The votes
will be close by and large, but you're hard pressed for a lot of these to find any Republicans who are going to vote no.
You know, Doug Collins at the VA, for instance, whomever the AG, Agriculture Department chair, who will be the Energy Department, all of
those through pretty quickly. The ones that we've identified as problems are the ones where there will be no Democratic support, and then you can
see two or three people potentially peeling away.
That starts with Pete Hegseth and Tulsi Gabbard for very different reasons, but those are the two most troubled ones at this point.
CHATTERLEY: Is there a message in here that some are pointing to, perhaps, that people want to align with president-elect, who does seem to have a
mandate from the people, but they won't go the full hog if they don't agree with some of these choices.
I go back to the point in the conversation I was just having with Tom about the suggestion, at least from the president-elect that he said to Matt
Gaetz, look, you're not going to get through the Senate, and we simply don't have the votes. Does that suggest that there are those that are
strong enough to say no or as you're suggesting, it is just a few and we know those names.
HEYE: Sure. By and large, we are talking about a handful of members, maybe six to eight Republican members, most of them are overwhelmingly going to
support Donald Trump's nominees and that's actually normal.
You know, there are so much abnormal stuff, Julia, around how Donald Trump operates, a real change in Washington. This process is a very normal one
that you have, members of your own party supporting the nominee. It is extremely rare for a nominee for a department head to lose a floor vote.
But what we also know is there are two months before Donald Trump gets sworn in. So that means that if you're Pete Hegseth, if you're Tulsi
Gabbard or anybody else, even those members who may fly by through the United States Senate, that ultimately the scrutiny is going to be intense,
whether there is an FBI check or not, that's obviously a real question that senators are going to have to deal with, having those checks is the normal
thing to do.
But there are two months there to learn a whole lot more about these people. And if they have vulnerabilities, those will be exposed pretty
widely.
[16:15:06]
CHATTERLEY: Do you think Gabbard gets through?
HEYE: At this point, I don't know. The difference between Pete Hegseth and Tulsi Gabbard is one of substance on issues and one of personal issues. The
scandals that have come out about Pete Hegseth are sex scandals, did he sexually assault women or not?
That's a very real issue that he is going to have to confront and address, but they are not necessarily issues of substance as to how the Department
of Defense or how Intelligence operates.
The concerns that we've heard about Tulsi Gabbard solely are about her ability to do the job and her past performance as a member of Congress, and
then certainly outside of Congress in regards to Russia, Syria, China et cetera.
The ones for Pete Hegseth, very personal.
CHATTERLEY: Yes. I mean that's what it comes down to.
It is interesting for me as well. And obviously it plays to the sort of business background that we haven't seen a whole host of the more business
aligned, industry aligned seats taken. Yes, we've got Commerce Secretary filled, but we haven't got Labor Secretary, Trade Representative is another
one that we don't have. The National Economic Council and of course, Treasury Secretary.
Does it make sense to you that he is taking his time over those decisions, again, as we were just discussing, particularly for Treasury Secretary,
there is a whole lot of things that have to align here, and they are not simple things. Tariffs, crypto --
HEYE: They're not simple things, and at some point, you're having Donald Trump trying to get a round hole in a square peg or vice versa. You know,
Trump does things a little backwards, but he takes this very seriously.
You know, Donald Trump talks about the markets almost every day and if the market is up, it is because of him and it is a great day. That's how he
takes things seriously. And you mentioned crypto earlier, very key component for Trump's consideration.
CHATTERLEY: Yes. Lots to consider.
Doug, great to have you with us. Thank you.
HEYE: Thank you.
CHATTERLEY: Have a great weekend. Doug Heye there.
Now still to come, the NFL and the NBA warned their teams about skilled thieves targeting players' homes. We will tell you what tools they're using
to commit those crimes. Stay with us.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to QUEST MEANS BUSINESS.
An Australian teen has become the sixth foreign tourist to die from a suspected mass poisoning in Laos. The deaths being traced back to a popular
backpacker destination and as Melissa Bell reports, it is raising huge concerns about alcoholic drinks being tainted.
[16:20:00]
(BEGIN VIDEOTAPE)
MELISSA BELL, CNN CORRESPONDENT: Six people are now believed to have died as a result of tainted alcohol poisoning in Laos. The latest victim, a 19-
year-old woman from Melbourne, Australia, who had been backpacking through Asia with her best friend.
The two women are believed, according to The Associated Press, to have been free shots in a hostel they were staying at before heading out for a night
of drinking in Vang Vieng, a popular hotspot for backpackers in Laos.
The other victims include a British woman, an American citizen, two Danish citizens as well with several western consulates saying they are working
with some of their citizens who are believed also to have been impacted by the tainted alcohol.
Those countries believe that methanol poisoning is to blame although no cause of death has been announced.
We spoke to one doctor who told us about exactly just how poisonous methanol was.
UNIDENTIFIED MALE: Even a drop of methanol is toxic it has been estimated that an amount of 10 milliliter of methanol could result in the deaths of
an adult of 70 kg, so it is really very toxic and the fatal amount is very low.
BELL: According to The Associated Press, several people have been taken in for questioning, including the manager of the hostel where the two young
Australian backpackers were staying although no charges have yet been brought.
What the deaths have triggered are warnings about the dangers of tainted alcohol and the need to take care.
Melissa Bell, CNN, Paris.
(END VIDEOTAPE)
CHATTERLEY: Thanks to Melissa Bell there.
Now more nations are reacting to the International Criminal Court's arrest warrant against the Israeli prime minister.
The court accused both Benjamin Netanyahu and former Defense Minister Yoav Gallant of alleged war crimes in Gaza. A warrant was also issued for the
Hamas commander, Mohammed Deif.
The German government says it will carefully examine the warrants against the Israelis. The US has already said it fundamentally rejects them, and
the EU says the court's decision must be implemented.
Israeli citizens meanwhile, appear to be rallying behind their leaders. Let's bring in Nic Robertson now in Jerusalem for us.
Nic, there are a number of human rights agencies also coming out and saying, look, the international community should heed these arrest warrants
and it should be a turning point in the war. But one has to question the validity and the relevance of that if both the Israelis and the United
States don't honor these court's proceedings or rulings.
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: It will definitely have an effect on the travel of the Israeli prime minister as far as we can see
for now, there is no doubt about that.
But in terms of continuing to prosecute the war in Gaza and with Hezbollah in the north, in Lebanon, that doesn't really seem set to change. As you
say, the main supporters of Israel, the main armed supporters, the United States will continue to send weapons. Absolutely. Because they reject what
the ICC is saying, and I don't think that was ever in doubt.
They had always indicated that when this first came up in May, earlier on in the year, and of course, the country sort of rallying around not
everyone, of course, but mostly around the prime minister and this idea of national self-defense and that's undermined by the ICC rallying around
that.
But, you know, there is a nuance when we listen to, say, the Germans as you mentioned, they say that they will continue to supply weapons, but if the
prime minister was due to go visit Germany, then they would have to address that issue then, so that it is sort of diplomatic.
But these European Union outlier, Hungary, Viktor Orban, the prime minister there, actually went out of his way to invite Prime Minister Netanyahu to
visit Hungary, to which the Prime Minister Netanyahu thanked him greatly.
The reality is, though, setting foot in Europe is going to be hard. The British have said that they would turn him over. The French have said that
they would turn Prime Minister Netanyahu over and the former Defense minister, but there has been a repercussion already for France because
France was involved in the ceasefire talks, or they were part of the formula around the ceasefire talks between Israel and Hezbollah in Lebanon,
and now Israeli officials are saying, well, we don't want France to be part of that equation now because they're clearly biased against us.
So there are already real world effects, but not such that that they are going to impact these particular wars at the moment.
CHATTERLEY: No, but diplomatic consequences to your point, which is also vital.
Nic Robertson, thank you so much for that.
Now the NFL and NBA are warning their teams about skilled thieves targeting athletes. It comes after football stars, Patrick Mahomes and Travis Kelce
had their homes targeted. The league saying criminals are using advanced surveillance technology as well as team schedules and social media to
gather information on their victims.
Josh Campbell joins us now from Los Angeles.
Who is believed to be behind these attacks, Josh? And what are the authorities saying?
JOSH CAMPBELL, CNN SECURITY CORRESPONDENT: Well, this investigation has now gone global. The FBI has been brought in, and that's because authorities
suspect that some of these incidents were actually conducted by transnational criminal groups coming into the US from overseas to target
these wealthy residents.
[16:25:17]
And as you mentioned, first, it was the NFL, now the NBA, now, the National Hockey League issuing these warnings to their players.
What authorities have noticed is that a lot of these incidents have the same attributes. I will tick through some of them. They're saying that
they've noticed that these burglaries have included extensive surveillance by these burglars, sometimes going as far as to pose as groundskeepers and
delivery drivers to get a sense of the coming and going of residents.
People are also scaling residences, getting up to the second floor master bedrooms to go after cash, to go after jewelry.
Now, we've been reporting on the concerns by law enforcement here in the US from coast-to-coast about this so-called burglary tourism. A lot of these
groups coming in, authorities say, from South America. I will let you listen here to one district attorney that we heard from. He said that these
aren't keystone crooks, these are professional operations.
(BEGIN VIDEO CLIP)
TODD SPITZER, ORANGE COUNTY DISTRICT ATTORNEY: They are very sophisticated. They lie in wait for days at a time in people's backyards. They have Wi-Fi
jammers to stop the alarm company from being notified, because a lot of people have Wi-Fi systems and then they have police jammers to jam the
signal of the police departments.
(END VIDEO CLIP)
CAMPBELL: And interestingly, here, Julia, these people are being targeted, these professional athletes, not just because they're wealthy, but also
because their team schedules are public.
Authorities say that these burglars are actually looking at team schedules, trying to figure out when they'll be away from home.
CHATTERLEY: Yes, so it is the fact that they're very open about and we know when they are not at home and perhaps when other in their family or
families are away as well. But I think it is interesting what he said about the Wi-Fi jamming as well. You need battery backup on the alarm systems,
which strangely, is actually quite rare.
Josh, how are they being told to protect themselves better when so much information about them is public?
CAMPBELL: Yes, so the leagues are providing guidance to players on how to protect themselves from becoming victims. What they're saying is that
people should install home alarm systems. They should have a relationship with law enforcement in their neighborhood.
And also, and this is good advice, not just for professional athletes, but for all of us, watch what you post on social media. Authorities have
learned that these burglars are essentially scraping the internet, social media, trying to find out where these players are posting from. Again,
that's a big signal that they're away from home.
So for all of us going into the holiday season, you might want to hold off on posting those beach pictures because that's telling burglars out there,
this could be a window of opportunity to go burglarize your residence because clearly you're not there.
CHATTERLEY: Yes, don't advertise that you aren't home until you're back and then you're back in the house.
CAMPBELL: Exactly.
CHATTERLEY: Yes, its great advice.
Josh Campbell, thank you.
CAMPBELL: You bet.
CHATTERLEY: All right, coming up for us, the giant fintech, Klarna moving towards going public. CEO Sebastian Siemiatkowski says it is critical to be
a global player, and he will join us from Stockholm after the break.
(COMMERCIAL BREAK)
[16:31:13]
CHATTERLEY: I'm Julia Chatterley and there's more QUEST MEANS BUSINESS in a moment when I'll speak to the CEO of FinTech giant or Buy Now, Pay Later,
Klarna, as it prepares to IPO in New York.
And the man who brought budget travel to the masses, Arthur Frommer a died this week. His daughter joins me to speak about his legacy.
But before that, the headlines this hour.
The judge in Donald Trump's hush money trial has postponed sentencing indefinitely. Judge Juan Merchan agreed to consider a motion to dismiss the
case. The Manhattan D.A.'s office has a week to respond. It said the President-elect's conviction should stand. He was found guilty of
falsifying business records.
Now that's MMA fighter Conor McGregor leaving a Dublin courtroom after a civil jury found that he did commit sexual assault back in 2018. The jury
awarded the woman more than $250,000. Police investigated the woman's complaint, but prosecutors declined to bring charges, saying there was
insufficient evidence that a conviction was unlikely. McGregor has maintained his innocence, testifying sex was consensual.
Music mogul Sean "Diddy" Combs was back in a New York courtroom asking a game to be released on bail. His attorneys claimed prosecutors altered a
video of him attacking then girlfriend, Cassie Ventura in 2016. Combs has been in the New York jail for 10 weeks awaiting his trial on sex
trafficking charges. He's pleaded not guilty.
And U.S. markets closing higher to finish out the week. The major averages all as you can see there in the green, the Dow led the way up more than 400
points. We're talking around one percent. Wall Street shows little sign of slowing down as a strong year already draws to a close. It's no wonder
European firms like FinTech giant Klarna may want to go public here in the United States.
They're known for Buy Now, Pay Later technology and recently filed the paperwork to go public. Klarna could be valued in the tens of billions of
dollars. The company hopes the IPO is part of a big 2025, it will integrate with Google Pay next year after striking a similar deal with Apple Pay.
Klarna CEO Sebastian Siemiatkowski is with us now. Sebastian, always a pleasure to talk to you. And it's an incredibly exciting time.
You've told me for years, really, that this was the plan that you were focusing on, profitability and you were also focusing on, at some point,
going public. There's a lot of fintechs out there saying they're going to watch you and see how it goes. Explain why now for the micro reasons, but
also macro?
SEBASTIAN SIEMIATKOWSKI, CHIEF EXECUTIVE OFFICER, KLARNA: Of course, no, it's great to see you again, Julia. I think that like as we have been
saying to me, it was clear for us that the future of retail banking and fintech speaks global. And we needed to be a global company, meaning
success in the U.S. We are now majority revenue U.S., over 30 million consumers in the U.S. but we also need to be profitable in the U.S. and as
we now have achieved those targets, you know, we feel that the time is ready.
Plus, you know, we've been private for 20 years, a lot of private investors, employees that hold stock. So, feels like a natural next step.
CHATTERLEY: Is that why? Because such a significant proportion of your business, as you're saying, and the growth of it is in the United States
now that you chose to list in the U.S. because there is a lot of bemoaning that you are this European giant. Why couldn't Europe have kept you there
and see you list there rather than coming to the United States? There is some disappointment, let's be honest.
SIEMIATKOWSKI: Yes. I think there is. And I hope, you know, when Spotify listed in the U.S., they hang out the Swiss flag instead of the Swedish
flag. So, I hope they do better this time around, but (INAUDIBLE)
[16:35:08]
CHATTERLEY: You'll sell them out?
SIEMIATKOWSKI: With that (INAUDIBLE) I think it's been, you know, as we did this evaluation, it became clear to us that, obviously, in addition to the
fact that we are mostly an American business by revenue nowadays, it's also so that there is a bigger understanding for growth companies like ours
among the investor collective in the US. And we think that will, you know, benefit the company.
Also think it can help our, you know, continuous marketing and awareness in the U.S. So, you know, there are obviously additional reasons like that.
CHATTERLEY: Yes. I was going through some of our old interviews, and I remember you saying to me back in 2022 that Apple Pay potentially offering
a Buy Now, Pay Later option was a testament to the power of the tool that you were already providing for consumers, but also, of course, it was
competition at that point. And now you're on Apple Pay here and, of course, in the U.K. as well, and you're going to hit Google Pay a little bit this
year and a lot next year.
It sort of takes you from a tool to being mainstream payments, which I know you were already doing, but I think the symbolism is huge, and the
business.
SIEMIATKOWSKI: Yes. I'm happy you say that. I would tend to agree, and I think it speaks to the kind of shift in strategy we decided to do a few
years ago, where we decided we want to be a network similar to Visa, MasterCard, and that needs -- we need to go from hundreds of thousands of
merchants to millions. And the way we can do that is with fantastic partners like Apple, Google and Adyen and WorldPay and all the other stripe
and other big announcements like that we've had that help us distribute our payments to consumers and merchants globally.
So very, very happy about this new -- and it's kind of a shift to a business to not work only directly with merchants, but through these
partners.
CHATTERLEY: Yes. I mean, you have a banking license too, in the E.U., so you are challenging the traditional banks. You've got Klarna card, Klarna
balance, Klarna cashback, I know as well. You mentioned the number of users, I think it's 85 million now, isn't it, actively worldwide? How big
can that get? What's the ambition?
SIEMIATKOWSKI: Well, you know, I am specifically instructed to not talk too much about the future under current circumstances, but I can say what we've
said previously, which is that, you know, we have -- with, you know, impressment, watch another fantastic Swedish company, Spotify, grow into
the hundreds of millions of users. And obviously we've already previously expressed that we aspire for the same.
I do think that banking is about to shift due to A.I. accelerating that. And I do think that we will see a few players dominate in the retail
banking space globally. There may be only three or four large retail banks in the future. So, I think that there is a major shift going on, and
obviously we aspire to be one of those.
CHATTERLEY: Yes. I want to come back to hat, because you've been very open about open about the prospects of A.I. and automation and utilizing that in
your business, which you already are. But, you know, I was looking at your U.S. stats, and we know already that for the traditional lenders here and
credit card balances are at record highs. We hear all the time from retailers that consumers are growing more cautious, which I guess, ties and
connects to the growth you're seeing as people look to spread payments or look at other credit opportunities.
What are you seeing, and how are you managing it? And how are you ensuring that profits are up 93 percent year over year in the first half of this
year versus last year? Because that's pretty astonishing.
SIEMIATKOWSKI: Well, I think, you know, we've always when we entered a new market, seeing that initially it's obviously harder to underwrite as you
have a larger proportion of new customers, and then once you matured into the market, you tend to see a shift, because you have more and more
returning customers, easier to underwrite. But also think to speak to this fact, I mean, McKinsey did this report already back in '15 that a lot of
credit card companies missed.
And it spoke about this large group of U.S. consumers that you called self- aware avoiders. These are the people that have been disappointed by the credit cards that were fooled into, you know, revolving into building two
big balances by being constantly promoting their credit limit. And these people are simply, you know, very hesitant. They want to avoid credit
cards. They like using debit but with the additional element of Buy Now, Pay Later or if interest fee installments, installments are fixed, they,
you know, you pay them off.
And it just leads to a healthier outcome for these consumers. And that's 25 percent of the U.S.-credit card -- potential credit card customers. So,
it's a huge market that has been heavily overlooked by bankers who sit in their offices and think everyone is just looking for loyalty points,
because that's people working at bank, but that's not everyone, right? People are -- other things, and not everyone appreciates their points
because there's many times are quite useless.
CHATTERLEY: Yes. But it's about understanding your consumer, isn't it as well, and not just sticking to the old subsets that you've traditionally
serviced and looking for other ones and being able to accurately provide a credit profile on these individuals as well, particularly in a new market.
How much of the growth that you're seeing, and again, the profitability that you're achieving, particularly relative to traditional lenders, is
down to what we've discussed in the past?
[16:10:01]
And I know you believe is an enormous transformational opportunity here, with things like A.I. and technology. How much of the driver, the growth
drivers, is down to that?
SIEMIATKOWSKI: Well, it's a combination. It's definitely picking up. And I -- for long time, believe, since we saw the announcement, and we've spoken
about this multiple times, that I think that out of A.I. will come -- will be a few companies per industry that will truly embrace the technology and
really kind of reimagine the businesses around it. And those companies will get the opportunity to, you know, really accelerate their businesses.
And when I look at what we do internally, take customer service as one example where, you know, we have reduced the number of human agents by 70
percent this year as a consequence of being able to use A.I. together with OpenAI in such a fashion, that is obviously a huge reason for the profit
increase that you mentioned and -- but we see it across the board. Banks are also much about regulatory compliance, which is a lot about legal
understanding.
Legal understandings is -- LLMS are quite good at that. So, there's tremendous amount of things that you can use this technology for in order
to, you know, basically, create better services for customers at lower cost. And this is just, in my opinion, the beginning of that.
CHATTERLEY: I always feel smarter after I've spoken to you. It's going to be a really exciting six months. Sebastian, stay in touch. Always more to
discuss. Great to have you on set. Thank you.
(CROSSTALK)
SIEMIATKOWSKI: Thank you. Thank you.
CHATTERLEY: Thank you.
SIEMIATKOWSKI: Thank you.
CHATTERLEY: All right. Coming up next for us, few people did more to popularize travel than Arthur Frommer whose guidebooks cover every corner
of the globe. His daughter Pauline joins us to celebrate his legacy. That's next.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back. If you've ever slept in a hostel or travel by rail, then you followed in the footsteps of Arthur Frommer. The travel
guide publisher, passed away this week at 95 years old. His first book Europe On 5 Dollars A Day came up back in 1957. It was among the first to
advise budget travelers how to see the world. And some of his tips include never travel first class, eat at restaurants frequented by locals and buy
an Eero Rail Pass.
I'm joined by Arthur's daughter, Pauline Frommer. She's the co-president of Frommer Media. Pauline, thank you so much for your time. And first, can I
say, how sorry we are for your loss, I believe you only laid him to rest yesterday. So it must be -- it must be very hard.
[16:45:12]
PAULINE FROMMER, DAUGHTER OF ARTHUR FROMMER: Yes, yes. But he had a peaceful passing and he had a wonderful 95 years.
CHATTERLEY: He also leaves an incredible legacy and has changed many lives, I think, and opened people's lives for decades about the opportunity to
travel, to see the world and to learn things, I think, from other cultures and other people.
FROMMER: Well, that was always his main objective. He felt that travel had the possibility of helping the cause of world peace. He felt that if you
traveled, you would realize that people on the other side of the world have very much the same concerns and needs that you do, that we have far much
more -- far much -- I'm sorry, we have more in common than we have that separates us.
CHATTERLEY: Yes. I read from one of his essays when I was preparing for this, travelers taught me that despite all the exotic differences in dress
and language of political and religious beliefs that all the world's people are essentially alike. We all yearn for the same goals. How true that is
today? Can we just go back to when he wrote his first book, when he was a G.I. in Europe? And I believe one of the challenges for soldiers abroad
there was they didn't know what to expect, and they were afraid to even leave the bases.
And he was like, look, get out there. You can do it for less than $5.00 a day. And a lot of people were saying, actually, you can do it for less once
they got out there.
FROMMER: Oh, yes, absolutely. It was a total fluke that he became a travel writer. He was drafted into the U.S. during the Korean War, and he got to
Germany, and he felt like it was a dream come true. In those days, only the very rich would be able to travel across the Atlantic. It was considered
the grand tour. And so, he democratized travel. He -- all of his fellow G.I.s just stayed on the base.
It was right after World War II. Europe was still in rubble, they thought it actually would be dangerous to travel cheaply, and he traveled all over
the place, and thought, I'll write a little book. It sold out in the army and then he wrote a book called Europe on 5 Dollars A Day for civilians. It
became the bestselling guidebook of all time. Changed his life and democratize travel.
CHATTERLEY: One of the quotes from the original book, which I loved. This is a book for American tourists who own no oil wells in Texas. Are
unrelated to the Aga Khan and have never struck it, which in Las Vegas. It was about to your point, democratizing travel for those people that weren't
the wealthiest in the world. May I ask where his favorite place in the world was and how you think he would like to be remembered?
FROMMER: He loved Paris. He was a Francophile. He thought that there was no place more beautiful than Paris. And he also admired how the French would
go into cafes and have serious discussions about politics, about philosophy. He thought that travel and life should be a thinking
experience, that everything was about learning. And I think he would want to be remembered for that.
He also was one of the first to talk about sustainable travel. He wanted to keep people to go, not to the multinational chains but to the small mom and
pop restaurants and hotels and support the local community.
CHATTERLEY: You know, a lot of Brits and I find it with Americans too. You know, we tend to not learn other languages. I'm talking very generalized,
because obviously everybody speaks English. Did he never worry about the sort of the sort of the language barriers or he -- his charm and Grace
somehow bypassed that as well?
FROMMER: Well. That's why he was sent to Germany. He was about to be sent to Korea, but because he was the son of immigrants, his mother taught
Russian and he spoke German and French. He was always a whiz at languages, so he was a big believer in learning languages, actually.
CHATTERLEY: And that's the strongest takeaway from me. If you don't know a language, get out there because this was life changing for him and for many
other people, I think too. Pauline, we're sorry for your loss but what an incredible father and what an incredible legacy. And I know you continue
the work too. Thank you.
FROMMER: Yes. Thank you.
CHATTERLEY: OK. Coming up next here on QUEST MEANS BUSINESS. Ultra- processed foods make up 70 percent of Americans diets. A new study looks at the possible health consequences.
(COMMERCIAL BREAK)
[16:52:20]
CHATTERLEY: Welcome back to QUEST MEANS BUSINESS. RFK Jr. says he'll crack down on processed foods if he becomes Donald Trump's top health official.
One of the agencies he would oversee is already studying the issue. It's looking at how ultra-processed food could be affecting our health. Meg
Tirrell has more.
(BEGIN VIDEOTAPE)
MEG TIRRELL, CNN MEDICAL CORRESPONDENT (voice-over): Sam Srisatta has been living in this hospital room at the National Institutes of Health for two
weeks.
TIRRELL (on camera): Do you have, like, wearables on? Like, tracking everything?
SAM SRISATTA, PARTICIPANT IN NIH STUDY: Yes. So, I do have a couple of these sensors.
TIRRELL (voiceover): He's not sick. He's a participant in a clinical trial, one of the first of its kind, measuring his movement, his blood, his gut
microbiome, even the air he breathes. All to try to better understand how our health is affected by ultra-processed foods.
TIRRELL (on camera): Oh, I think your food is coming in.
And he saw the kind of food he got and eggs, and spinach, and yogurt. But we don't know. That could be processed. It could be unprocessed. That's
part of the trial.
TIRRELL (voiceover): Ultra-processed foods contain additives and ingredients you wouldn't find in your own kitchen. They were shown in the
previous NIH study to drive overeating and weight gain, according to researcher Dr. Kevin Hall.
TIRRELL: Are ultra-processed foods just junk foods?
DR. KEVIN HALL, SENIOR INVESTIGATOR, NATIONAL INSTITUTES OF HEALTH: What we often think of as junk foods probably captures a big chunk of the ultra-
processed foods in a kind of a category, but there's a lot of things that people would be surprised are in the ultra-processed foods category and
could potentially be healthy for you.
So things like whole grain breads that you might buy from the supermarket. Most of those are considered ultra-processed because of some of the
additives and preservatives that are in there, as well as how they're manufactured.
But there's a lot of debate about whether or not all ultra-processed foods are bad for you.
TIRRELL (voiceover): And that's what this trial is trying to find out.
HALL: What are the mechanisms? What is it about this category of foods that is driving people to overconsume calories?
TIRRELL (voiceover): Dr. Hall's team has two ideas about what might be causing people to overeat some ultra-processed foods. Their energy density
or how many calories are in each gram of food, and their hyper-palatability when foods contain just the right combinations of salt, sugar, fat, and
carbs to make us not want to stop eating them.
TIRRELL (on camera): This is where they prepare all of the food. And they don't just prepare it; they weigh it before it goes up and when it comes
back after the participant has eaten.
TIRRELL (voiceover): Each day participants in the trial are offered a total of 6,000 calories and researchers measure how much they choose to eat. The
trial is a month long and each week has a different diet, minimally processed or different kinds of ultra-processed.
Sam was in an ultra-processed week during our visit but one with foods Dr. Hall doesn't expect will drive him to overeat.
[16:55:02]
TIRRELL: How is that ultra-processed?
SARA TURNER, DIETITIAN, NATIONAL INSTITUTES OF HEALTH: It's all based on the ingredients. So the eggs that we used in that omelet, the egg whites
were a liquid egg product. So it has ingredients in it that make it ultra- processed. It's not just eggs.
Our yogurts, the pancake syrup that was in the yogurt, those all have ultra-processed ingredients in terms of added flavors, added sweeteners.
TIRRELL (voiceover): The next day Sam would switch to meals that were more energy dense and hyper-palatable, the ones expected to lead to overeating.
TURNER: So you can see that these are all foods that are ultra- processed. And you can see that the volume compared to this is quite different as
well.
TIRRELL: Wow, that is really illustrative. I mean, just looking, you need two trays of food for this one and one tray of food for this next diet when
you're getting the same number, you're offering, at least, the same number of calories.
TURNER: Correct, yes.
TIRRELL (voiceover): Once a week, Sam spends a full day sealed in this metabolic chamber.
TIRRELL: Do you know what they're measuring in there?
SRISATTA: I think they're measuring how much O2 I consume and how much carbon dioxide I release.
TIRRELL (voiceover): The air he breathes in and out can tell researchers how many calories he's burning and whether they're coming from carbs or
fat, all to help understand what ultra-processed foods really do to our bodies.
HALL: But understanding how the food environment actually does shape our metabolic health we hope to basically improve the food supply in the
future.
(END VIDEOTAPE)
CHATTERLEY: Thanks to Meg Tirrell there. Coming up for us, the latest numbers from Wall Street right after this.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back. Wall Street ending the week on a positive note, the Dow gaining 426 points. Let's call that a percentage point to close at
a fresh record. The S&P 500 and the NASDAQ also finishing higher. All three indices up more than 1-1/2 percent this week. And that is QUEST MEANS
BUSINESS. I'm Julia Chatterley. "THE LEAD" with Jake Tapper starts right now.
(BEGIN VIDEO CLIP)
DONALD TRUMP (R) PRESIDENTIAL-ELECT OF THE UNITED STATES: Women's sports.
JAKE TAPPER, CNN ANCHOR: In just a few minutes, we're going to get the perspective from a transgender athlete who still wants to compete.
Plus, critics say the line separating church and state is even more blurred today with news from Texas, the state's board of education voted to allow
Bible-based lessons in public schools.
[17:00:03]
And there's even a financial incentive for schools to use those plans.
END
