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Quest Means Business
U.S. And Iran Signal Progress In Negotiations To End War; Nations Turn to Businesses To Help Reopen Strait Of Hormuz; Pope Leo Warns Of Risks Posed By Unregulated A.I.; Merlin CEO: A.I. Sits Alongside, 'Not Necessarily Replacing' Pilots; Source: "Intense Talks" With Iranian Delegation In Qatar; Oxford Economist: A.I. Has Caused Us To Drown In Busywork. Aired 4-5p ET
Aired May 25, 2026 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:20]
RICHARD QUEST, CNN INTERNATIONAL HOST, "QUEST MEANS BUSINESS": I was going to start off by saying closing bell ringing, but of course, no closing
bell. U.S. markets closed for Memorial Day and none in London either, a bank holiday as well.
But the other markets in Europe, the. The DAX and the MIB, you see, they showed strong gains and that is all for the reason we are going to be
talking about over the next hour. The markets and the events you and I need to get to grips with.
Oil prices are plunging as Iran's top negotiator heads to Qatar to thresh out a ceasefire deal with the U.S.
Pope Leo says A.I. must be disarmed, as the Pope presents his first Encyclical.
And the death of the $3.00 latte may be greatly exaggerated. The Manhattan Coffee Shop, using coffee-nomics to keep prices down and coffee flowing.
We are live tonight in London, Monday, May the 25th. I am Richard Quest and I mean business.
Good evening.
Oil prices continue to fall as investors now are seeing and appreciating the signs that the U.S. and Iran are moving closer to a peace agreement.
President Trump posting on Truth Social, said negotiations are, in his words, "proceeding nicely." U.S. officials say the two sides are working to
resolve language disputes on nuclear issues and sanctions. The President also suggested Saudi, Pakistan and others may join the Abraham Accords as
part of any deal with Tehran, which would be a development indeed.
Top Iranian officials are in Qatar, which has taken a greater role in mediation, and they are expected to discuss the Strait of Hormuz, Iran's
frozen funds and the highly enriched uranium, the nuclear dust as President Trump calls it.
Meanwhile, the U.S. President highlighted the nuclear threat at an event that commemorated Memorial Day in the United States.
(BEGIN VIDEO CLIP)
DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES OF AMERICA: In Operation Epic Fury, we lost 13 wonderful souls, wonderful, special people, these
incredible men and women gave their lives to ensure that the world's number one state sponsor of terror will never have a nuclear weapon. Oh, and they
won't. They will never have a nuclear weapon. I am sure you know that.
(END VIDEO CLIP)
QUEST: Hopes for the deal did send prices lower. Brent is off seven percent back under a hundred for the first time in a month, still higher than
before the war and experts are still saying that even if the Strait reopens quickly, getting things back to where they were will be a logistical
nightmare.
Joining me is Anna Cooban.
We've sort of been here before. I think the issue is how much credence is being put now that this will flesh out into something real?
ANNA COOBAN, CNN BUSINESS AND ECONOMICS REPORTER: Well, I think that's a really good point, Richard, because remember, we have been here before, not
only staring hopefully down the barrel of a peace deal, but that then fell apart and then not only did it end, those negotiations, but actually the
situation escalated.
So of course, we are seeing a lot of relief among investors today. These are quite significant falls under $100.00 a barrel, but mixed with that
relief is a sense of trepidation. And also, Richard, I want to point out that lets say this ends very quickly. We get a deal. This is a long-term
problem. There have been long-term consequences, you know, caused by this, namely actually unclogging that backlog of ships, getting them out of the
Strait, then getting those empty tankers back in, repairing all the damage from all of those airstrikes.
This is not something that can be resolved with a click of a finger.
QUEST: No. But this idea that it is going to be months before supply returns to normal, there are those who are saying that's a very
pessimistic, particularly the administration by the way. I saw Kevin Hassett saying that things would get back much more quickly than that.
So there are those who are saying we are being too pessimistic in forecasting that the supply issues will last a great deal longer.
COOBAN: Well, I think one of the reasons for some of that pessimism, Richard, is the fact that a lot of the production has actually been shut
in, like it has actually been sort of stopped pumping from the ground. It is about 15 million barrels of crude and other refined products.
And you can't just switch that back on like a light switch. It takes time. It can take months to get those wells back up and running. One of those
issues involved in that is the coordination that will be required between countries and companies, because a lot of these wells in this region are
sort of next to each other.
[16:05:10]
This is a logistical, a huge logistical feat to get this back up and running and that's one of the reasons for the pessimism.
QUEST: The ultimate, I suppose, will be when the oil starts -- the ships start moving. Until then, it is just a wing and a prayer and a promise and
confidence that has been shattered, as you would say, as you told me before.
But the market is desperate for better news.
COOBAN: It is, and also, Richard, we are coming up to this really busy -- or it has already started sort of summer travel season.
This weekend in America, you've got 45 million Americans flying or driving long distances and the head of the IEA was actually saying not too long ago
that we are coming up to the red zone, really referring to this summer travel season.
So it was already a very desperate situation, but the world is hungry for energy, and that is just going to get more and more acute over the coming
months.
QUEST: I hope you're all managing to keep cool. Hottest day, did you know? Hottest May on record in London so --
COOBAN: In the offices, it is quite cool here.
QUEST: The air conditioning, yes, we haven't cut back that much yet. Thank you.
Iran has used speedboats, mines and drones to block the Strait. Now the U.K., France and others are working on how to reopen it. The efforts will
likely involve the private sector, with some deploying unmanned vehicles to find and deactivate them.
Others, like SRT Marine Systems, will use A.I. to improve coastal surveillance. Simon Tucker is the CEO of SRT Marine.
Simon is with me now. How do you use A.I.? What does it do that makes it safe?
SIMON TUCKER, CEO, SRT MARINE SYSTEMS: Hi, Richard, nice to meet you and thank you for having me.
Well, the first thing you've got to do is try to detect where the threat is. The problem with mines is they float around. You don't know where they
are laid.
And so countries like Kuwait that are deploying these new systems right at the leading edge, you're looking at trying to spot where the activity was
that laid the mine and then start to use drift patterns to figure out where that mine might have floated and gone. Then you've narrowed down your
search area.
Then you can start to use sonar with edge compute, where again, you're using A.I. to learn the different shapes that it is not a wreck or somebody
just dropped something that's round and looks like a mine many years ago, that that is a mine. So you can go to that point and destroy it, deal with
it, and whatever you like.
But the key is the surveillance to find out where the thing is.
QUEST: Right. Now, the British ship that is waiting to go there, that's a specialty of this sort of thing. The weapons commander has asked, how many
mines do you think there are, and of what types? To which she replied, how long is a piece of string?
And I guess sort of your goal first is to clear a channel and waterway. You obviously can't clear the whole thing and you have to be very, very
targeted in that regard.
TUCKER: Well, that's exactly the point. You have to be targeted. The Iranian Gulf is 615 miles end to end, and at points, it is 200 miles wide.
So, it is not just about the Strait of Hormuz. There is a whole shipping lane right the way down to Kuwait, into Bahrain, into Saudi Arabia, into
Qatar, and actually, you need to sweep all of that.
So you need to use these advanced surveillance systems to figure out where these things might be, and then narrow down using things like USVs like
this thing that sits behind me, if you can see me, fitted with sonar to really narrow down and find it, and the technology -- sonar, A.I.,
surveillance systems like Kuwait is deploying at the moment at scale enables that to happen.
So you can do huge areas intelligently using all this new technology, not a ship puttering up and down the lane.
QUEST: And I was reading about the sheer number and different types of mines. I mean, I always think of this sort of the, you know, the Second
World War mine, bobbing just under the water with spikes coming out of them.
But I was reading about one that blows up gas or something that sits on the bottom, which I didn't quite understand how that was going to work. I mean,
the variety that you are searching for and the depths at which they will be makes it a three dimensional chess.
TUCKER: You're absolutely right, and actually, again, the Arabian Gulf is not that deep. It is about 300 feet at its deepest point.
So from a detection and sonar perspective, actually spotting something, it is not terribly difficult. We can fit sonars to our needlefish in Kuwait,
and they will spot these things.
But as you rightly say, there are lots of different types. Innovation happens even in mines. But that is where the learning comes in and you can
recognize the shapes, the form factors and things -- and then it will narrow it down.
[16:10:10]
The key is to find it with something that isn't going to disturb it. So this is where USVs -- Unmanned Surface Vessels -- come in and remote
surveillance of the type that, you know, Kuwait Coast Guards deploy.
You can actually detect these things at a distance.
QUEST: When you do find them -- now, let's say you find them and there is no ship nearby, so there is no danger to life nor limb except maybe
arguably the vessel.
What do you do? Do you attempt to capture it? Do you attempt to disarm it or just blow the thing up? Because once its blown up, that really is the
end of that.
TUCKER: Once you've found it, I think you blow it up. That is the decision of the authorities. They are well equipped to do that. And actually, once
you've found it, it is a relatively easy thing to do.
You can dispatch a small UAV down, tack some small explosives and blow it up. I think the last thing you want to do is to let -- is to sort of leave
it there and let it, you know, do you leave it there forever and come back next year? I suspect not.
QUEST: Sure. Last question, and perhaps the most tricky one, after you have been involved in surveying an area, what level of guarantee are you able to
give "to the client," whoever it might be, about the integrity in a sense?
Can you say, I can now say a hundred percent, that is clear. I can say 70 percent that is clear or do you just simply say, I've done the best I can.
Over to you, mate.
TUCKER: I think that's a great question. I think that a competent Coast Guard will have a high degree of confidence that they have done a sweep,
then when you combine that with surveillance, you can then spot whether there, for example, by behavior, whether there is a fishing boat that is
acting in a way that shows that it is laying another mine, and then therefore that area will become an area of interest and marked on the
command systems.
But you'd have a high degree of confidence, but there is no certainty at sea.
QUEST: I am grateful, sir, that you've joined us.
And as this proceeds, we will talk more with you. Thank you, this evening. Thank you.
As QUEST MEANS BUSINESS tonight comes from London, a Nobel Prize winning economist says companies are using automation to cut payroll when they
should be focused on productivity.
Its Daron Acemoglu who says that the tendency could worsen inequality. There he is. He will be with us after the break. Have a swig, sir. Get the
vocal cords moving nicely.
(COMMERCIAL BREAK)
[16:15:25]
QUEST: Pope Leo, in his first letter or Encyclical to the church, is warning about the risks of A.I. It is 235 pages long, and it addresses the
use of A.I. in warfare, advocating for the most rigorous ethical constraints, and it calls for protecting the distinctive grandeur of
humanity.
Now, interestingly, the Pope was joined by the Anthropic co-founder Chris Olah, who said society must have a say in A.I.
(BEGIN VIDEO CLIP)
CHRISTOPHER OLAH, CO-FOUNDER, ANTHROPIC: Some might believe that matters of A.I. are best handled by computer scientists like myself. They are
mistaken. The questions raised by A.I. are bigger than the A.I. research community, not just in their implications, but also in their nature.
(END VIDEO CLIP)
QUEST: Now, Encyclicals are used by the Church to establish the view or if you like, the direction, and they come at great moments of change.
Popes have addressed, for instance, you see workers' rights. Rerum Novarum in '91; Peace, Pacem in Terris, Humanae Vitae, one of the most famous, of
course, on birth control in '68. Caritas in Veritate -- you get the idea. There are lots of them.
Christopher lamb is in Rome.
Christopher, I have to confess, I attempted to read it. I clicked on the link and I mean, this thing is heavy going, all 43,000 words of it. You
know, you've really got to sift through it.
But from what people like you are telling me, this is groundbreaking stuff.
CHRISTOPHER LAMB, CNN VATICAN CORRESPONDENT: Well, Richard, yes, I think it is a very significant intervention because as you pointed out, it comes in
the line of other major papal texts, including Rerum Novarum, which was published by Pope Leo XIII on the defense of workers' rights at the time of
the Industrial Revolution, and Pope Leo is saying that another revolution is taking place, and the Catholic Church and the papacy has to raise its
voice to respond to what is going on with the development of A.I., which the Pope sees as having the potential for good.
But he does point out there are very many dangers associated with the technology, not least the use of A.I. with automated weapons systems. The
fact that he says, it being controlled by a powerful few. And the Pope is seeking to have a dialogue or trying to influence the people who are in
charge of this technology by having Chris Olah on the platform with him to release this text. That is really very unusual.
It is unprecedented for the Pope himself to personally release an Encyclical, and it shows how he sees A.I. as hugely important and really a
defining topic for this age, and he wants to try and not just issue a text that stays on the bookshelves, but actually influence and change the way
this technology is being developed.
(BEGIN VIDEO CLIP)
LAMB (voice over): A Pope weighing in on the debate over Artificial Intelligence.
Leo XIV wants the Church's voice heard on what he sees as a revolution. Taking the unprecedented step of personally presenting an Encyclical letter
on the issues, one of the highest forms of papal teaching.
POPE LEO XIV, BISHOP OF ROME, HEAD OF THE CATHOLIC CHURCH AND SOVEREIGN OF THE VATICAN CITY STATE: Artificial intelligence needs to be disarmed. The
word is strong, I know, but deliberately chosen because this moment needs words capable of attracting attention, awakening consciences, and
indicating paths forward for humanity.
LAMB (voice over): Doing so alongside Chris Olah, a co-founder of Anthropic, the leading A.I. firm, which has been in a legal dispute with
the Trump administration.
An ethical and human centered development of A.I. is a top priority for the American Pope, who is known to be tech savvy.
At the heart of his plea, an insistence that technology cannot replace the "grandeur of humanity," nor take the place of God or personal conscience.
And that A.I. should not be controlled by a powerful few and warning about its use in war.
Leo wants to influence those responsible for the new tech after ten-year dialogue between the Vatican and Silicon Valley over A.I.
[16:20:07]
LAMB (on camera): The Pope sees A.I. as raising more than just technical questions. He sees it as asking profound ones about what it means to be
human.
Now, in the past, the Catholic Church has made mistakes entering into scientific debate, but Pope Leo believes that faith and science, while
asking different questions, shouldn't be in opposition but help one another.
POPE LEO: And may the blessing --
LAMB (voice over): This Encyclical, likely to be a landmark text for Leo's papacy, a Pope seeking to address a defining issue of the age.
(END VIDEOTAPE)
LAMB (on camera): Well, so, Richard, I do think this is a document that is going to be potentially one of the landmark texts of Leo's pontificate and
a major intervention into the A.I. debate.
QUEST: I am grateful to you. Thank you, Christopher Lamb in Rome tonight.
Now speaking alongside the Pope, Olah said there was a possibility A.I. will displace human aid at very large scale. The CEO of Goldman Sachs puts
it in a different way. It is probably more a question of perspective and view.
David Solomon argued in "The New York Times" that the A.I. job apocalypse is overblown, writing the U.S. has a long track record of creating new jobs
in response to disruption from the electrification in the 1900s to the Digital Revolution of the 1990s.
I don't see any reason to think this dynamic will stop now.
Daron Acemoglu is the Nobel Prize winning economist with me. He is a professor at the MIT -- Massachusetts Institute and has written extensively
on the subject.
If we -- we know that jobs are going to go and when I read Solomon's article, I sort of thought, you're putting a rosy picture on this because,
you know, jobs will be created as well.
But net-net, would you say society is even remotely ready?
DARON ACEMOGLU, NOBEL PRIZE WINNING ECONOMIST: Oh, I would say we are completely unready and indeed, yes, Solomon's argument is very rosy. There
is no guarantee that we will always create as many jobs as we destroy. That really depends on how we use technology. It depends on organizations. It
depends on institutions. It depends on a whole host of factors.
Some of them are under our control, that's why it is very difficult to make very strong pronouncements about the future of the job market, because some
of this will depend on how we use A.I.
A.I. is a very promising, but also very versatile technology. Who controls it matters, how we direct it matters; whether we just focus on automation
or other things matters greatly. So it is great that, you know, many important people are weighing on this, including the Pope.
There is a big question, and we shouldn't just leave all of these, you know, life-changing decisions to a handful of people.
QUEST: I am fairly pessimistic that governments will put in place the necessary policies for retraining, for work-life balance, all the things
that we failed to do in every Industrial Revolution so far. Am I being too pessimistic?
ACEMOGLU: Well, why? I mean, look at the U.S. government's track record recently. It is perfect. Why can't you have confidence in our government?
No, I am just kidding.
Yes, I mean, we have done everything wrong when it comes to A.I. We are completely unprepared. The Biden administration did not have a coherent
A.I. policy. Trump administration has a much worse A.I. policy. It is not even remotely coherent, and it doesn't acknowledge the risks.
And there are really amazingly important decisions that are going to be made in the next several years. Some of them are related to building
guardrails, but some of them are related to what the A.I. companies are doing right now.
QUEST: It is very -- the economic environment that we are talking in now is very tricky. Essentially, there is stagflation in many countries that
unless the Gulf scenario and the Iran scenario improves dramatically could lead to recessions in some major economies.
Do you believe -- which do you believe now is the more pressing problem? Growth, jobs or inflation?
ACEMOGLU: Look, I think inflation is a big problem because of the affordability crisis that it induces. Then that is related to the fact that
many households in the United States and more generally in the industrialized world are not earning enough. It is related to the labor
market.
If we keep on our current trajectory of increasing profits, but stagnant wages, the affordability problem will get worse, and inflation would take a
heavy toll on working people.
[16:25:10]
So, yes, it is absolutely essential to rein in inflation, but also to create wage growth, and you cannot dictate wage growth. You cannot dictate
wage growth. You cannot tell companies pay your workers 50 percent more. They won't do that and if they did, they would go bankrupt. If they keep
everything else the same.
So you need to induce the companies to use technology in a way that makes workers more productive so that they will actually end up hiring more
workers and paying them more. That's happened many times in history.
But by the way, we haven't done that well in the Digital Revolution. Look at what happened in many parts of the United States, where many communities
suffered huge job losses because of imports from China, and even more from automation.
So we can repeat all of those problems at the moment in a much more massive scale.
QUEST: The problem always, is that there is never any reason to do it, until there is a crisis, or until the bond market vigilantes decide to
wreak an attack on a government like they did with Liz Truss, for example, or that they have started to look at the U.S. debt.
There is never a reason, on an average Monday in October or whatever, to actually address some of the core problems.
ACEMOGLU: Absolutely. That's right. But even deeper than that, I think A.I. is a really once in six, seven, ten generation change in the production
structure of our economy. So you do need some sort of consensus on how to deal with A.I.
Society has become so polarized that some solutions are going to be seen as left-wing solutions and are going to get pushback from the right. Others
are viewed as right-wing solutions. They are going to get pushback from the left.
We need to have a broader conversation, that's why the Pope's intervention is very important. We need to talk about what it is that A.I. can do and
what are our values? What is it that we want from this very promising technology? I don't think many people would say, we want this technology to
make Elon Musk even twice as rich or concentrate power in the hands of Sam Altman, Elon Musk and Mark Zuckerberg.
We want something that's good for all of us, and if you think about it, lots of workers being laid off from their vocation and not having anything
productive to do, not contributing to society isn't anybody's idea of a happy society.
QUEST: I am grateful that you're with us tonight, sir. Thank you very much indeed for talking to us. I appreciate it.
ACEMOGLU: Thank you, Richard. My pleasure.
QUEST: Thank you, sir.
Now, from the cockpit to the control tower, the aviation industry is really getting to grips with how A.I. transforms the industry.
The start-up, Merlin Labs is now testing how I could one day fly a plane. Our aviation correspondent, Pete Muntean, who does fly planes, I ought to
tell you.
He took to the skies to see how it works.
(BEGIN VIDEOTAPE)
PETE MUNTEAN, CNN AVIATION CORRESPONDENT (voice over): I am in the co-pilot seat of a Cessna.
MUNTEAN (on camera): One, two, three. Good.
MUNTEAN (voice over): And I am about to find out what happens when the pilot flying is not human, but artificial intelligence.
TIM BURNS, CHIEF TECHNOLOGY OFFICER, MERLIN LABS: This is our experimental caravan.
MUNTEAN (voice over): Tim Burns is the chief technology officer at Merlin Labs, a Boston startup developing a system that can be bolted into existing
airplanes.
Merlin says its system can fly the plane, talk to air traffic control, and even help make decisions about weather and routing.
BURNS: We are trying to capture the judgment and abilities of a real aviator.
MUNTEAN (voice over): Merlin says it has completed hundreds of test flights to see how the system performs in real world conditions, though it is
likely years away from carrying passengers.
In the back of the plane, one of the company's engineers is monitoring what the A.I. is doing in real time.
MUNTEAN (on camera): I don't know if I know exactly what I am in for here.
MUNTEAN (voice over): Alongside me is test pilot, Matt Diamond, who on this flight won't be doing much piloting at all.
MUNTEAN (on camera): So this is just a manual takeoff.
MATT DIAMOND, PILOT MERLIN LABS: This is going to be an automated takeoff.
MUNTEAN: Oh, this is an automated --
DIAMOND: Yup!
MUNTEAN (voice over): Meaning, the A.I. system is flying the airplane from the very start.
DIAMOND: Good job!
MUNTEAN (on camera): Nicely done.
MUNTEAN (voice over): The next part of the demonstration, communicating with air traffic control.
Merlin's system displays its language processing on an iPad as it listens to a mock controller, repeats the instruction, and then flies the airplane
to match it.
CONTROLLER: Magic 01, turn left, heading 090. Descend 2000.
A.I. VOICE: Left 09, zeroing down 2,000. Magic 01.
DIAMOND: Clear to authorize.
A.I. VOICE: Authorized.
MUNTEAN (on camera) We are about 1,500 feet now over Newport, Rhode Island. And we just turned on to the final approach here at Quonset State Airport.
Now, this is going to be an automated landing and the system will fly the airplane all the way down to the pavement.
DIAMOND: It is a challenging problem for the automation. But once you crack the code, then it is so much easier on the pilot.
MUNTEAN: You seem pretty confident over there.
DIAMOND: Oh yes. Yes.
MUNTEAN: You seem pretty relaxed. Should I be this relaxed?
DIAMOND: Yes! Absolutely.
MUNTEAN: All right.
MUNTEAN (voice over): As a pilot and a bit of a control freak, this is not exactly easy for me. But the system lines up with the runway and flies a
gradual descent all the way to touchdown.
MUNTEAN (on camera): Smooth. Easy.
DIAMOND: Right on center line.
MUNTEAN (voice over): Even still, putting A.I. in control of an airplane raises big questions about safety and trust.
Merlin's CEO Matthew George.
[16:30:44]
MATTHEW GEORGE, CHIEF EXECUTIVE OFFICER, MERLIN LABS: What we are building is certainly very sci-fi, but we are doing it in a responsible, incremental
way.
MUNTEAN: Will this put pilots out of jobs?
GEORGE: It won't. This is sitting alongside pilots, not necessarily replacing pilots, and enabling those pilots to do more of what they do
best, which is operate aircraft safely,
MUNTEAN (voice over): That could be appealing to airlines worldwide, which will need to hire more than 600,000 new pilots over the next 20 years,
according to Boeing.
Merlin has already secured a hundred-million-dollar contract with the U.S. Air Force to eventually fly cargo planes without pilots on board at all.
But convincing passengers may be the hardest part.
UNIDENTIFIED MALE: As long as it's safe and more efficient and tested out in advance, I'm for it.
UNIDENTIFIED FEMALE: I don't know if I trust A.I. in the air. I doubt I trust it.
UNIDENTIFIED MALE: I like the idea of humans having control. I don't like the idea of machines having control.
MUNTEAN (voice over): Pete Muntean, CNN, Quonset, Rhode Island.
(END VIDEOTAPE)
QUEST: And I don't know, I'll have to never think about that.
We'll be back with more in just a moment. I'm real. I'm real. I'm real. I'm real.
(COMMERCIAL BREAK)
[16:35:01]
QUEST: Hello, I'm Richard Quest. Together we have more QUEST MEANS BUSINESS.
An Oxford economist says A.I. is drowning us in busy work, and Matto Espresso says if you want a reasonably priced coffee, they have got one on
offer. The co-founder was at one of their shops and made a cup for myself.
We'll get to know those stories after the headlines. This is CNN, and here the news always comes first.
Both Iran and the United States say they have made progress towards a potential peace deal. President Trump, says negotiations with Tehran are
proceeding nicely. Iran's Foreign Ministry says a degree of understanding has been reached but stressed that agreement is not imminent.
Pope Leo has released his first encyclical, and it's focusing on Artificial Intelligence. The Pope's issues encyclical also offer teachings about moral
and existential challenges.
However, it's rare for the Catholic Church had to attend a press conference unveiling this kind of document. The pope attended, and he warned that A.I.
must not stay in the hands of a few, and it is already fueling wars.
Moscow is warning diplomats and other foreign nationals to leave Kyiv, ahead of what it's calling systemic strikes. Ukrainian capital still
recovering from one of the largest waves of air strikes. Officials say four people were killed in Kyiv this weekend, 87 people were wounded.
Our top story: Oil prices are falling as the U.S. and Iran work towards a peace deal with Iranian chief negotiator, the foreign minister, and the
Central Bank governor attending talks in Doha.
The diplomatic sources says they are -- the talks are intense and in free, and freezing funds is one of the issues.
Stephen Collinson is with me, and when I look at the people -- I beg your pardon, Fred Pleitgen is with me to discuss -- to put more of this into
perspective.
The talks that are taking place, and I look at the range of people who are there, and that gives me indications of the complexity in the different
subjects.
FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes , it certainly is a great deal of complexity, but I think one of the things that
we can certainly glean from all of that, that you have these really top negotiators for the Iranians, Richard, including Mohammad Bagher Ghalibaf,
who is the parliamentary for the president of Iran's parliament, as well as the foreign minister, Abbas Araghchi there, certainly shows that the people
who are negotiating with the United States via the Pakistanis, who are working out the nuts and bolts of this possible memorandum of understanding
between the U.S. and Iran to try and put an end to the -- to the conflict between the U.S. and Iran, they were -- are in Qatar to speak to the
Qataris. And that shows that this is very important.
And then, you notice the fact that the Central Bank governor is also there. That certainly goes to show that one of the main things for the Iranians as
they try to move towards this memorandum of understanding with the United States is unfreezing of assets. It's something that they have said that
they have needed, they wanted for a very long time.
We know that Iran's economy is in a crunch, and certainly getting some of those assets unfrozen could be something that could give them fairly quick
relief.
(CROSSTALK)
QUEST: Right. The question of how who needs the deal most becomes crucial, as we get to this sort of very tense period of negotiation. Donald Trump,
of course, because of the high price, because of the Midterms, but he continually says, you know, he would -- he does not do bad deals, and he's
told his negotiators, you only do a good one, and if you're not happy with it, we don't do it.
PLEITGEN: All sides into this, Richard, are saying that the other side needs a deal more. One of the things that we keep hearing from the Iranians
is they believe that they are in a very strong position right now. They have shown that they can close the Strait of Hormuz. They say that their
military is even stronger now than it was before, also because, of course, it still retains, as they put it, a lot of the missiles and drones that
they have had before.
So, the Iranians are saying, look, we are in that region, we are situated in that region. There is no doubt that Iran's economy is hurting. A lot of
people in Iran are hurting from that bad economy as well.
But they say that they believe that they're in a pretty strong position. The U.S. also says that it could keep up this blockade for an extended
period of time.
However, one thing that we have seen, Richard, which, I think is very important, is that pretty much all of the nations of that region are saying
we can't do this for very much longer. You look at the Saudis, the Qataris, the United Arab Emirates, but then, also, of course, the Pakistanis, who
are leading the negotiations between Iran and the United States, all of them are saying this needs to end, the region needs to breathe, these
countries in the region need to be able to export oil and gas, and certainly, the situation right now in the straight or four moves is not
something that is sustainable.
[16:40:02]
So, I think that from that perspective, the Iranians have also acknowledged that they see that there is this big regional push to try and prevent all
of this from becoming a shooting war once again, and then, of course, also to reopen the Strait of Hormuz and make sure that traffic can flow through
there a lot more freely than it has been over the past months.
QUEST: Fred Pleitgen, looks like a lovely evening in Berlin tonight. I'm grateful. Thank you, sir for joining us. Thank you.
Now, A.I., well, it could be just like anything you want it to be. How about your next exterminator, repairman, accountant -- certainly, cook,
because at the end of the day, it is you.
There is Professor Carl Benedikt Frey. A.I. is filling our lives with busy work. The question for you, professor, what can't it do? You'll answer that
and more after the break.
(COMMERCIAL BREAK)
QUEST: I think I've lost count of the number of things I've asked A.I. to help me with, just in the course of the day, because one of the greatest
promises, all you have to do is just ask. And according to my next guest, be careful of what you ask for, you'll end up drowning in busy work, as the
economist Carl Benedikt Frey argued in the -- in the New York Times.
He says people using A.I. to help them with tasks instead of paying an expert. Writing, "I know I'm not the only one who has recently become my
own exterminator, repairman, or accountant."
The doctor is professor of A.I. at the Oxford Internet Institute. He joins me now. So, Doctor, here we go. I -- look, I'm like anybody else. There is
a thousand and one things I couldn't get it to work. I asked A.I. to help me, and it gave me, I would say eight times out of 10 it works. Twice it's
just completely cocked it up, and I've had to throw the thing away. But what's the risk in all of this?
CARL BENEDIKT FREY, ASSOCIATE PROFESSOR OF AI & WORK, OXFORD INTERNET INSTITUTE: Well, the risk in the end of the day is that you are spending a
lot of your own time trying to figure out what the professional knows. And what you don't know you don't know, right?
And in the end of the day, a lot of tasks require asking the right questions. So, many times, just like you know, in your case, I try things,
they don't work, sometimes they do work, but in both cases, I'm spending my own time, and that's opportunity cost. Most people tend, frankly, not to
consider it that much when it's their own time, they are spending, rather than directly their own money.
QUEST: And, of course the A.I. itself is designed to give the hit, the dopamine hit of I'm getting closer, I'm getting closer.
[16:45:03]
I was trying to do something with a computer that wasn't going to work, and it kept saying to me, "You are nearly there, Richard. Just try these,
instead. No, I promise you, this is going to work next.
And by the -- and after three or four hours, I realized I finally told you exactly what I thought of it. But the temptation is to keep going because
you want to save the money.
FREY: That's right. And often, when they keep going, the worst answers you get, right. So, often, when you see, when you look at medical questions,
for example, if you ask a question and first reply, you get around 90 percent of accuracy. Plus, research from my colleagues at Internet
Institute shows.
But when you continue the conversation, you quite soon get down to something like 30 percent, because if you keep feeding it out, an
incomplete information, and so, the conversation continues, and you are getting worse results as you go by.
QUEST: How does one know when it's something that should be just call in somebody to repair it? I mean, I'm going to have a bash at fixing the
radiator or taking the vacuum cleaner apart, even though it may end in tears.
FREY: Well, I think that's a key question. I think, you know, a lot of people, they think of A.I. as something that will replace knowledge work.
What few think -- people think about is that if I can fix my boiler or my dishwasher, or believe I think I can, I'm going to save that initial
conversation with the heat engineer. That might mean less income for the heat engineer, so, going to have an effect on the labor market, and it may
also eventually mean that, you know, I spend more on my own time if it doesn't work, only to call the heat engineer down the line.
So, I don't want to minimize the upsides here. So, obviously, you know, most people don't have access to doctors straight away, and you can get,
you know, valuable medical advice from A.I. and other things too.
But I think that the narrative around A.I. is very much such as that A.I. is this amazing productivity tool, and it's going to solve a lot of
problems for you, whereas, what we are seeing is the rise of this self- service economy, whereby more people are going to try to do more things themselves.
And one of the great achievements of capitalism over the last 200 years was that we outsourced a lot of things, we specialized more narrowly in our
job, and we stopped doing our own cooking. We began to let other people do our haircuts, at the restaurants, and so on.
And I think we are seeing a reversal of that process with AI.
QUEST: Have you had any disasters where you've tried to do something yourself, and you really should have quote got a man in to do it.?
FREY: Well, we had a rat in our garden a couple of months ago, and I thought I'd give it a go, and rather than call an exterminator, I asked
him, you know, ChatGPT. And he came up with some very plausible advice. I tried it, I got the cage to try to catch the rat, it didn't work out, and
we ended up calling an exterminator in the end of the day.
QUEST: I thought you are going to say you poison the neighbor's cat. Thank you, sir, for joining us. I'm grateful for tonight on QUEST MEANS BUSINESS.
I'm grateful.
Now, get your orders in. I test my barista skills in a new chain, hoping to take on the New York coffee scene.
(COMMERCIAL BREAK)
[16:51:04]
QUEST: It could not be more simple. three bucks and the coffee is yours. And it's causing a stir on the New York coffee scene. Matto offering a flat
rate for a flat white or indeed any other coffee of your choice.
Think about it. just get the cup and it's all yours. In a city where a cup can easily set you back about seven bucks. Yet coffee prices have
skyrocketed.
So, I stepped behind the counter to see how this company's managing to do it at that price, and in doing so, take on the biggest brands.
(BEGIN VIDEOTAPE)
QUEST: I'm going to give him a job. Well, maybe not.
Very nice. that really is excellent. cheers.
JENNIFER MAMAN, CO-FOUNDER, MATTO ESPRESSO: I was in Italy with some friends, and wherever we would go in Italy, we would have the most
incredible cappuccinos and lattes with the perfect foam. It didn't matter if we would go to the most expensive place or inexpensive place, you could
get an incredible cup of coffee. And so, that was really the big moment where we said, why doesn't something like this exist in the United States?
QUEST: Right. Because the coffee you are talking about in Italy is a couple of euros. It was the price point that became important as well, wasn't it?
MAMAN: Right. The big part of the business is the $3 menu. So, when you say, I want to charge $3 for coffee, then, you build an entire system
around that.
QUEST (voice over): The Matto app is the key to that system, and it's the only way to get your hands on that coveted $3 coffee.
MAMAN: We decided to put together a menu that really targets the most popular items that people order every day, and we decided we want the top
quality.
So, we partnered with a coffee roaster from Italy that's been roasting coffee for over a hundred years.
QUEST: Right. But you also have to be very attuned to what people are -- the needs. So, for instance, we've got an affordability crisis at the
moment.
MAMAN: Right.
QUEST: Are you going to be able to keep $3, bearing in mind every one of your costs are going up at the moment?
MAMAN: Our model was designed to be profitable at $3. So, we have small store footprints. So, that lends to lower operating costs. And our app has
been really revolutionary in terms of serving the customer and how they experience Matto.
QUEST (voice over): Well, not talking has made me thirsty.
QUEST: Would one of you come here, please, and make me a nice hot cappuccino.
Now, what have you discovered works, and what have you discovered doesn't?
MAMAN: It's really the simple things. Make a good quality cappuccino espresso, give it to them on time, give them friendly and quick service.
That's what they want. You don't need to sell a lot of things. You just have to make it right and you have to give them what they want.
QUEST: So, you know that being a barista was my pandemic project.
MAMAN: No, I didn't know that.
QUEST: So, during the pandemic, I decided right, everybody else was baking banana loaf.
MAMAN: Yes.
QUEST: So, I went out and I bought myself the, a proper espresso machine and learned how to make espresso. And I realized that my first ones were
truly awful. And my latte art is awful. How was your latte art?
I have to confess, I'm not good at that at all. I leave it to the baristas.
QUEST: Lots of latte.
UNIDENTIFIED FEMALE: Lots (PH) of latte. OK. So, first, we need to shot of espresso. Take the tamper and press it. just try to press it like straight.
Yes.
QUEST: Lock it in.
UNIDENTIFIED FEMALE: Yes. Take the cup.
QUEST: OK.
UNIDENTIFIED FEMALE: Put a little bit milk, then, swirl the cup a little bit with the milk. Yes.
Now, how the cup like this. and now, we (INAUDIBLE)
You want to wiggle (INAUDIBLE)
QUEST: I need to wiggle.
UNIDENTIFIED FEMALE: Try to do like this.
QUEST (voice over): Let me just say it took a couple of tries to get this right.
[16:55:04]
UNIDENTIFIED FEMALE: It's not good.
QUEST: We try it again?
UNIDENTIFIED FEMALE: Yes.
Like really relaxed. like only hand. Yes.
QUEST: -- again.
UNIDENTIFIED FEMALE: Birthday gift.
QUEST (voice over): Eventually, I got it. Well, sort of.
UNIDENTIFIED FEMALE: So, when you are going to pour the milk, try to pour it like make circles.
Yes, yes.
QUEST: Well, there is a sort of wiggle. That's the best wiggle I've ever done.
UNIDENTIFIED FEMALE: I mean --
QUEST: It's sort of --
UNIDENTIFIED FEMALE: Flower. Heart.
QUEST: Finally, the name Matto --
MAMAN: It means crazy in Italian. People think we are crazy for charging $3 for coffee.
(END VIDEOTAPE)
QUEST: Quite extraordinary, and it really does work. $3 for a cup of coffee, you have to use the app, even --
But here is the one I found particularly interesting when I was there, because I said, well, if you don't use the app, how much is it? I expected
to say $5.90 or something, but now she just looked at me, said, oh no, we only add about $0.50 only if you don't use the app.
Let's see how long they can keep that sort of pricing there.
We will take a "PROFITABLE MOMENT" after the break.
(COMMERCIAL BREAK)
QUEST: Tonight's "PROFITABLE MOMENT", I don't know how many times we have to be told that we are not prepared for the A.I. revolution that's upon us.
Tonight, the Nobel economist said it again on this program. You've heard it again and again, people saying, we are not prepared, and far from it, we
are actually going in the wrong direction in terms of our preparations. It doesn't matter whether it's on ethical grounds, whether it's on digital
screens, doesn't really matter.
From our point of view, QUEST MEANS BUSINESS, we talk about the economics of it all, and we are destined to make the same mistakes that we did in the
industrial revolution, the digital revolution, the fourth industrial revolution, and now.
The problem is there is never any urgency to do it on a random Monday in May.
It creeps on you, and what politician is going to start saying, I need to spend X, Y, Z, when there are so many other demands.
Look, I really don't want to be that sort of mealy mouth, downhearted, and particularly on a spring bank holiday, when the weather is spectacular in
Europe.
[17:00:04]
But the warnings are clear, and if we do not heed them, then, frankly, we have nobody to blame but ourself.
And I'll live it at that, because it is spectacular weather. Have an ice cream, make time to sit in the park, and make sure you don't take your
devise with you. Because that's QUEST MEANS BUSINESS for this one tonight. I'm Richard Quest in London. Whatever your up in the hours ahead, I hope
it's profitable.
END
