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Quest Means Business
U.S. Markets Drop After Strong May Jobs Report; Hiring Begins To Rebound After Last Year's Slump; Senior Military Adviser To Iran's Supreme Leader Speaks To CNN; Trump Floats Idea Of A.I. Profit-Sharing With American Public; Cloudflare: Most Internet Traffic Now Driven By Bots; Albanian Protests Grow Over Trump-Linked Resort. Aired 4-5p ET
Aired June 05, 2026 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:22]
RICHARD QUEST, CNN INTERNATIONAL HOST, "QUEST MEANS BUSINESS": The closing bell is ringing on Wall Street, and it is most certainly a day that you
might want to look in the opposite direction, particularly. I mean, the Dow was bad enough, down nearly 700 points, as you can see. I think we are just
off the lows of the day.
But the Nasdaq, that has really taken a beating. It is down four percent, the worst performance since April of 25, incidentally. And in fact, it is
the worst week for the S&P, the NASDAQ since again April of last year.
The markets are unhappy, and we will discuss that over the course of this program.
Those are the markets and the main events that we are talking about.
The red hot jobs report for the United States, and now, the prospect of a rate rise in the months ahead from the Fed.
A top aide to the Ayatollah tells CNN Iran will expand the war between the Persian Gulf if the U.S. resumes the conflict.
And President Trump says the United States government is considering taking financial stakes in A.I. companies.
We are live in New York, Friday, end of the week, June the 5th. I am Richard Quest and yes, I mean business.
Good evening. We start tonight with that strong U.S. Jobs Report and the reason is it has investors now worried that the Fed will soon raise
interest rates rather than cut them as they had hoped.
The Dow Jones and the S&P, as you saw just a moment ago, both closed well into red. But the tech heavy, NASDAQ that bore the brunt closing four
percent. This morning's U.S. Jobs Report showed that the economy added a robust 172,000 jobs. That's about 70,000 more than expected.
Now, the strong number could give the Fed room to raise rates this year because in the balance of its dual mandate between inflation and full
employment, it would seem inflation is now the more serious issue.
President Trump complained about the market reaction. He says the jobs report should have instead sent stocks higher.
Chip stocks were particularly badly hit. The Philadelphia Semiconductor Index, which tracks the sector, plunged more than 10 percent. Just look,
all the major players were sharply lower, and the weak guidance from Broadcom that we told you about earlier this week really has given question
to the whole chip rally.
Paul La Monica joins me. Guru La Monica, we are going to get into the economics in just a moment. I want to focus with yourself.
The market doesn't like what it is seeing, but what is it that they don't like?
PAUL R. LA MONICA, SENIOR MARKET ANALYSIS WRITER, BARRON'S: Yes, I think, Richard, that the market is clearly nervous about whether or not all of
these investments in A.I. are going to pan out. Obviously, you mentioned Broadcom earnings and the resulting slide in that stock and chip stocks
broadly have tumbled as a result.
There is a new memory chip ETF, relatively new ETF with the ticker of DRAM, it was down 15 percent today. Micron is a big holding in that as well as
the South Korean giants, SK Hynix and Samsung.
But take a step back, Richard. What I am heartened by and I am going to be in the uncomfortable position of actually being somewhat bullish and maybe,
dare I say, pollyannaish, if you look at the S&P 500 today, about 243 stocks, nearly half the stocks in the index were actually higher, utility
stocks were higher, real estate stocks were higher.
Consumer staples stocks, healthcare stocks. Yes, it was a headline number; for the broad market, that was ugly. But many stocks did go up today. It
was tech that really got crushed.
QUEST: I guess the fear and we can talk about it on this program almost nightly, is that at some point when future earnings can't justify these
very high valuations, you really have only one option and that is the price goes down and that's what we will start to see.
Now, that could feed into a much wider and more brutal market reaction.
[16:05:01]
LA MONICA: Exactly. If earnings growth starts to decelerate rapidly, that is obviously problematic, but first quarter results were phenomenal, and if
you look at estimates for the second quarter, you know analysts are still projecting more than 20 percent growth in the S&P 500.
I agree, it bears watching whether or not this A.I.-induced slowdown hurts the broader economy, but we are not seeing it in the estimates yet. I think
another concern is you obviously alluded to with the solid Jobs Report, the Fed isn't going to be cutting rates anytime soon. Rate hikes could be back
on the table potentially later this year, even though Kevin Warsh is perceived as being more dovish than his predecessor, Jerome Powell.
QUEST: How long do you think they've got before you know, the canary is singing so loudly that you can't ignore it and you have to move.
LA MONICA: It is not going to be at the next meeting, which will be, you know, Warsh's first in a few weeks. We do have CPI and PPI numbers coming
out next week. That will give another sign of inflation. But also, this is going to be interesting to hear from Warsh and others on the Fed.
Inflation, we all know, is something that usually causes the Fed to raise rates, but this is an unusual bout of inflation. It is commodity led, oil
led because of the war in Iran that ultimately could lead to weakening demand, and if that's the case, the fed wouldn't want to necessarily raise
rates and further hurt consumer demand. I am not saying they should cut rates, but maybe they hold steady until the war is over.
QUEST: That is the conundrum that they face with a commodity led bout of inflation. How do you manage that?
I am grateful. Thank you, Paul La Monica joining me.
Hiring in the United States, we were just telling you has rebounded in the last three months. Last year, the labor market averaged over 10,000 new
jobs a month. Now things seem to be on the upswing. And if you look closer at the report, the leisure and hospitality sector added 70,000 jobs.
Government, private education also performed well.
Jobs were lost in wholesale trade and financial activities. Betsey Stevenson was the chief economist at the U.S. Labor Department. She is now
a Professor of Public Policy and Economics at the University of Michigan, and Betsey is with me now.
And when you look at the numbers of the net -- they lost, they gained, therefore, this is the overall picture. Does that give you -- the makeup of
the number, does that give you cause for concern?
BETSEY STEVENSON, FORMER CHIEF ECONOMIST AT THE U.S. LABOR DEPARTMENT: You know, the labor market is looking better right now. I think when you look
at that makeup, you want to look over a longer period of time. And 2025 was definitely terrible for the labor market.
Jobs came from only one place, that private sector health care services; all the other sectors together lost jobs, and the reason we didn't have job
declines overall on net in 2025 was because the growth in the health care sector was bigger than the loss in all the other sectors.
Now, if you look in 2026, what we've seen is some recovery in these other sectors, and ongoing growth in health care. So where does that put us? When
we look at all the jobs together, we are still, you know, in most industries having fewer jobs than we had in January of 2025.
So right now, we are kind of in a recovery in a lot of different sectors, including manufacturing, including the goods producing sector, including
business and professional services. So, all of that means that I wouldn't, you know, say like, everything is definitely great quite yet. You know,
what we are seeing is some recovery in sectors like leisure and hospitality in particular.
QUEST: Okay.
STEVENSON: But there are still a lot of sectors that have been super weak.
QUEST: Are we seeing evidence of the return of manufacturing jobs? We always knew it was going to take longer. I mean, from liberation day
onwards, it was going to take quite a long time before those jobs would materialize. But do you believe the United States is seeing evidence that
manufacturing jobs are being moved back in?
STEVENSON: Well, I want to actually caveat that with, you sounded like you were trying to connect it to the tariffs or liberation day. I think what we
actually saw in 2025 was a speed up in the loss of manufacturing jobs that occurred because of the tariffs, because of the uncertainty.
And we have now seen that settled down, and we are seeing the declines have now stopped, the declines that began around liberation day and we are
seeing a tiny recovery, adding 7,000 manufacturing jobs is not a lot.
[16:10:11]
QUEST: Right.
STEVENSON: But there is no evidence that the tariffs have led to some sort of resurgence in manufacturing. I don't think really there is any reason to
believe that that's occurring. Could that occur at some point in the future? I am really not holding my breath for that.
QUEST: Okay.
STEVENSON: And you know, even the Trump administration has said our goal is to build manufacturing in the United States with very few employees.
QUEST: Right. But I think that -- sorry, and thank you for pointing that out, because the position that the administration has taken with liberation
day and with the tariffs is if you build your factory here in the United States, you won't get tariffed and we will even make it advantageous to
you.
So I guess, at some point, one would hope to see that as a policy, more manufacturing jobs. Otherwise, the tariff policy just shot themselves in
their own foot.
STEVENSON: Well, yes, you know, I think that the tariff policy has shot us in the foot and you know, I think there are still some believers holding
out hope that that's going to help. But, you know, I think that there is more than a hundred years of economics telling us that that's not the way
to build an economy.
QUEST: If you now look at the dual mandate of the Fed, obviously you come at it as a labor economist, but which do you now think is the more
important where they have to give primacy, inflation or labor?
STEVENSON: You know, I still think they have to keep their eye on both. That is what a dual mandate is all about. Right now, the risk is greater
with inflation than the labor market. Right? We are seeing a labor market where people are still getting hired. There are some signs of weakness,
right? We do still see the duration of unemployment increasing.
It is a low fire, low hire labor market, which means if you're trying to enter the labor market or you do lose a job and you're trying to find one,
it is going to take you longer than it used to, and that can be very discouraging for people. It can cause people to drop out. So it is not a
perfect labor market for everybody.
But that said, the risk right now is on inflation. It is the -- you know, it is absolutely the case that this inflation has been caused by
commodities, by oil prices, things that might be not ongoing inflation, but the Fed has been dealing with five years of inflation above their target
and they have to watch for the way in which that might get built into expectations and trigger ongoing inflation above the target.
QUEST: And the whole credibility question. Betsey, how very good of you to come on tonight and make sense of it all for us. Thank you very much
indeed.
Now, the Strait of Hormuz disruptions have wreaked havoc on global supply chains. We talk about it every night, and it is drawing historical
comparisons to the Suez Canal.
In a moment, how Egypt is trying to reinvent its critical waterway.
(COMMERCIAL BREAK)
[16:15:50]
QUEST: Iran's Supreme Leader hasn't been seen in public since the start of the war with the United States and Israel. Our Fred Pleitgen got access to
a top aide in his inner circle. He sat down with Mohsen Rezaee, the senior military adviser to Mojtaba Khamenei.
We want to remind you, CNN operates in Iran only with the government's permission, although we maintain full editorial control of our reporting.
Here is Fred's exclusive interview.
(BEGIN VIDEOTAPE)
FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: You are the military advisor of the Supreme Leader. How is the Supreme Leader doing? Is
he fully in control of everything? And President Trump said that he would be honored to meet the Supreme Leader.
MOHSEN REZAEE, SENIOR MILITARY ADVISER TO MOJTABA KHAMENEI (through translator): This will not happen. Right now, we are in the first stage of
negotiations, and Mr. Trump has brought the negotiations to a standstill. This will not happen.
PLEITGEN: Are the negotiations right now blocked, or do you think that a Memorandum of Understanding can be reached quickly?
REZAEE (through translator): In my opinion, the negotiations are at a deadlock and Trump must break this deadlock.
PLEITGEN: They are waiting for an answer from Iran.
REZAEE (through translator): Iran has openly stated that our assets have been frozen and you must release them. The Americans are not telling the
truth in this regard.
PLEITGEN: So the frozen assets are the big problem right now?
REZAEE (through translator): This is a sign of trust building. If Trump takes the negotiations seriously, $24 billion is not much to America. If he
wants to reach an agreement with Iran, this $24 billion is a test of trust that Iran wants to have with Trump.
This is a test that America must pass, and the path will be opened. This is our own money, not America's money.
PLEITGEN: Wouldn't a war be catastrophic for Iran as well, though? It was a big bombing campaign.
REZAEE (through translator): If the war continues and the naval blockade is not lifted, we will drag the war to the Indian Ocean, the Bab El-Mandeb
Strait, the Red Sea and the Mediterranean, and we will give another dimension to the war by attacking these other American bases that we have
been attacking so far. America will definitely suffer much more losses. America's losses will be very heavy.
PLEITGEN: Final question. What's your message to Donald Trump?
REZAEE (through translator): Mr. Trump must make decisions independently of Israel. He must give what is the rights of the Iranian people and stop the
blockade, release our frozen assets and this can be a new horizon for the future of Iran and America.
Therefore, Trump must put aside his personal interests and think about the interests of the American people. If Trump has the courage, many issues
will be resolved in the future.
(END VIDEOTAPE)
QUEST: Our exclusive interview there with Fred Pleitgen.
The disruption in the Strait of Hormuz is drawing historical comparisons to another choke point of global trade, the Suez Canal and the crisis in the
1950s, when the waterway was closed for five months. Then it was controlled by the United Kingdom and France, and had been for decades.
Israel invaded Egypt in 1956, when the Egyptian president nationalized the canal. The Suez Canal was a cheap shipping route for oil from the Middle
East. Egypt did eventually take full control and reopened the canal, so 70 years later, give or take, Egypt is now considering building a distribution
hub along the Suez Canal as well.
The country wants to strengthen the waterway's position as a trading center and better connect Africa to markets in Europe and Asia. After all, the hub
is expected to fortify the Suez Canal's economic zone and transform it from a transit point to a distribution center.
His excellency, Mohamed Farid is the Egyptian Investment and Foreign Trade Minister. The Minister is with me now from London.
Good evening, Minister.
[16:20:10]
When I say it as I've just done, it sort of begs the question why wasn't it done sooner? It seems such an obvious thing, doesn't it to -- you have this
great thing, the Suez Canal. You turn it into a logistics and distribution hub.
MOHAMED FARID, EGYPTIAN INVESTMENT AND FOREIGN TRADE MINISTER: Well, thank you, Richard, and thank you for the historical exposition as well that you
had put in place.
For Egypt, I believe it is a matter of priorities. You need to, first of all, to put your fiscal balance in place, your house, when it comes to the
finances, monetary policy stances. We needed to work on it extensively during the last two years and the messaging as well that we needed to do
for conveying to investors the consistency of our messages.
And as well, when we are tested, we stick to our story. A couple of years ago, we said explicitly, we are going to be inflation targeting rather than
FX targeting and we opted for this option again when we were tested nowadays. The same applied to the fiscal balances, and for the fiscal space
that we managed to create during the last few months.
And nowadays, it is the time after building the relevant infrastructure network in Egypt for a number of years. I can tell you that over 550
billion of USD has been spent on building the infrastructure network that connects actually the Suez Canal zone, and now it is the time for creating
this distribution hub after building the entire infrastructure network.
QUEST: Right, so one of the problems I think that's, and obviously I've been to Egypt many times and I've reported from there. Many of the projects
never come to full fruition. It is almost as if, you know, they go wrong somewhere along the way, they become extremely expensive and they don't
actually necessarily come to where they're supposed to.
How can you be sure that this idea will, that there will be both political and investment support for this?
FARID: Well, first and foremost, I would love to know, when was the last time you visited Egypt? Because you need to see what has been completed
during the last period in terms of projects from the one hand, in terms of infrastructure investments and the network that has been built in all
cases.
So, this is a good starting point. We, from a political perspective, we know in details what is required to create this sort of distribution
network and distribution hub within the Suez Canal. And not only, to be honest, within the Suez Canal zone, as well in the areas of the Northern
Coast and Alexandria, because we can be supporting distribution either to the Eastern Hemisphere, to the east side of the continent and the west side
of the continent.
So the difference nowadays is that details, the level of details that we have entered into, to get to know exactly what are the operational
requirements by distribution companies, the legal requirements for them, how can we amend some of the customs regulations and by-laws that govern
clearance of goods and services.
QUEST: Okay.
FARID: For at least a good story in in the area. So this level of details, you don't go into it unless you want to finish the project.
QUEST: The investment, I mean, the investment scenario in Egypt, there is huge opportunities in the country, aren't there? Absolutely vast
opportunities. It is the largest of course, population and I am wondering what you think will truly unlock that opportunity and make the thing work
better? What do you think the core requires?
FARID: Okay, that's quite a very good question, Richard. The starting point, as I mentioned, we needed is macroeconomic stability. This is
already in place and then when it comes to investment and trade policies, we have the strategies. We are not short of ideas, let's put it that way.
It was all about execution. And we are in the execution mode when it comes to, ease of doing business and facilitating doing business for, businesses
operating in Egypt initially because investors are investors, whether they are foreign investors or local investors. So we cater for their needs.
So one and foremost, or one of the most important aspects would be ease of doing business, ease of establishing companies, ease of capital increases,
anything related to convertible notes, shareholders agreements. So all of the byproducts related to the ease of doing business, we are working on it.
This is on the short term and the medium term as well, the licenses -- the licensing requirements.
So here, we are embarking on a medium-term project whereby everything is going to be digitalized.
[16:25:07]
This is the crucial aspect here to make it irreversible reforms, it needs to be electronic, it needs to be digital and it we need to have the buy-in
of every single entity in the licensing process, and this is done already.
QUEST: And that will give me good reason to come back to Egypt when hopefully, sir, you will show me around and you can show me those projects
that you're talking about. I am grateful for your time tonight. Thank you, sir.
Anthropic's co-founder, Jack Clark says A.I. will soon be self-improving, and he told Anderson Cooper that will have a dramatic effect on the
industry. You'll hear it in a moment.
(COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest. There is more QUEST MEANS BUSINESS in a moment.
President trump is floating the idea of the U.S. government taking stakes in A.I. companies. We will talk about that.
And some U.S. high school students are putting their financial literacy to the test, the National Personal Financial Challenge, and somebody has got
the bright idea that I should also try it. We will see.
Before that, we get to the news headlines because this is CNN, and on this network, the news always comes first.
A top military adviser to Iran's Supreme Leader says peace talks with the United States are deadlocked. He told CNN those talks could make progress
if the U.S. agrees to release $24 billion in frozen Iranian assets.
During the exclusive interview, he said in his words, the ball is in the Trump's court.
The U.S. economy added 172,000 jobs in May. That's about 70,000 more than expected. The robust showing unnerved investors as it boosts the likelihood
that the Fed will raise interest rates later this year. So the Dow, the NASDAQ and the S&P 500 all fell sharply.
[16:30:03]
Five astronauts have been directed to leave the International Space Station and temporarily seek shelter on an attached spacecraft. NASA gave the
instructions, while Russian cosmonauts assess a leak on their side of the laboratory. There have been concerns for some time about cracks and leaks
on the ISS. This latest development suggests the situation may have deteriorated.
The Trump administration is considering taking equity stakes in artificial intelligence companies, as well as profit sharing with the American people.
President Trump told reporters on Air Force One today that he plans to host A.I. leaders at the White House next week. He said he is already been
talking to them about partnering with the government, so, the U.S. doesn't fall behind China and other countries in the A.I. race.
(BEGIN VIDEOTAPE)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I will tell you, yes, I have -- I have spoken to all of them. There is something very interesting about
it, where it almost becomes a partnership with the American public, and we'll look into that. We are going to -- we are looking. I actually have a
meeting scheduled in the very short -- very near future, with -- did you know that? With all of the companies, and we are talking about it. Where
the American people can benefit from the success of A.I. And by doing that, they can like it better.
(END VIDEOTAPE)
QUEST: Lisa Eadicicco is with me.
This is very unusual. I mean, governments take stakes in companies if they are about to go bust, if they are strategically important, or there is some
other reason. But Donald Trump is basically saying, the American people should share in the wealth by the government taking a stake.
LISA EADICICCO, CNN BUSINESS TECH EDITOR: Yes, Richard, you're right. This is a pretty unusual move by ordinary standards. But when you look at what's
been happening over the past year, there are some pieces of context that start to kind of make this -- make sense. For one, we do know that A.I. and
America's leadership in A.I. and having America benefit from A.I. has been a big theme and cornerstone of Trump's second administration.
And we also know there is been growing concerns about the impact of A.I. on jobs, on the economy, and the growing amount of power that these few
companies that are developing these A.I. models are holding.
(CROSSTALK)
QUEST: Right.
EADICICCO: So, I do think that we are going to reach a point where something has to be done about it, and, you know, these A.I. companies have
also been vocal about working with policy makers on that.
OpenAI, earlier this year actually released a set of policy recommendations. And in that document, they do mention this idea of a
public wealth fund that would entail collaboration between A.I. companies and the government for a public fund that the --
(CROSSTALK)
QUEST: But why? Yes, but --
EADICICCO: that citizens would be able to benefit from.
QUEST: Yes, but why? I mean, at the end of the day, if the public wants to benefit, they buy shares, that's the way it works. Our pension funds or
401(k)'s buy shares in these companies. The moment governments start picking and choosing like they used to do in the old industrial policies of
the 1960s, it usually doesn't end well.
EADICICCO: Yes, I think, it speaks to the uncertainty around A.I. It is growing faster than a lot of other industries. And I think there is just so
much concern about what happens if your job gets displaced by A.I. Is there going to be some sort of social safety net? A lot of these questions have
been coming up over the past year, in particular, as these A.I. models have been advancing.
So, and I think, it again, speaks to the uncertainty that we are kind of, you know, in an unprecedented area in terms of how quickly A.I. is
spreading and kind of impacting people's everyday life and the economy,
So, you know, we don't have a lot of those answers now. It's something we are going to have to wait and hopefully learn more about soon. But yes,
this is definitely somewhat an -- of an unusual move.
And, you know, Trump has in the past, you know, had some, I guess, what you might say --
(CROSSTALK)
QUEST: Right.
EADICICCO: -- unusual business arrangements in the past, as well. You know, it took a 10 -- the Trump administration took a 10 percent stake in
Intel last year, but again, that was a bit of a different scenario. That's not quite like what this sounds like, based on what he said today,
QUEST: No, quite -- the Intel one was more distressed stock.
Thank you. Fascinating story. A news -- I like the word unusual arrangements. Lisa joining us.
Anthropic says that the A.I. industry needs to build a brake pedal that would contain its own creations. The company's co-founder, Jack Clark,
warns that the A.I. models will soon be self-improving. And he told Anderson Cooper that the industry must develop ways to maintain control
over them.
(BEGIN VIDEO CLIP)
[16:35:00]
JACK CLARK, CO-FOUNDER, ANTHROPIC: So, today, when we want to do good in the world in areas like biology, or medicine, or robotics, you have to take
these systems that mostly exist as digital A.I. systems, and adapt them into this complex domain in the real world. And you do that by pairing with
scientists to do it.
Now, an A.I. system capable of improving itself is also capable of going into domains like medicine, going into domains like biology, discovering
what it needs to get smarter and more capable, and working with people to adapt itself to improve its performance there.
So, I think, what we are seeing is the potential for a dramatic acceleration in science in the coming years as these A.I. systems gain this
capability and become much more like creative co-scientists than tools that scientists use, which would be a big change.
ANDERSON COOPER, CNN ANCHOR: The downside, I mean, for anybody who's seen any science fiction movie, and I hate to be so sort of -- given my lack of
science knowledge, a lot of it comes from science fiction movies, but and obviously, in all the science fiction movies, we give control to these
machines, and obviously, we all know what happens, and the people create them are the first ones who get killed, and then, they run them up in human
society. What is that -- what to you is the risk here?
CLARK: Yes, we read the science fiction and watch science fiction here as well, so, it's not lost on us, but this is how some of the stories start.
And the risk here is what happens if you can't validate or verify or trust the behavior of these systems. It would be like if we dropped hundreds or
thousands of new colleagues into your newsroom, it would take you a while to figure out if you can trust them, if they work in the way that you
expect. If, when you ask them to do things, they come back with something that you think is good and in line with your expectations. That's one of
the challenges here. How do you maintain control over fleets of scientists that are much, much larger and much faster than ones you have had before.
(END VIDEO CLIP)
QUEST: Now, when we come back after the break, we are going to put it and discuss that further and see exactly how that will work. A brake pedal and
what it means.
A luxury -- also, we'll tell you about the luxury resort project linked to the Trump family, that's leading to fierce opposition in Albania. In a
moment.
(BEGIN VIDEO CLIP)
(END VIDEO CLIP)
(COMMERCIAL BREAK)
QUEST: Now, Artificial Intelligence, A.I., is already starting to take over the web. Cloudflare says that bots generated more Internet requests than
humans this week, for the first time in history.
[16:40:01]
And some of the busiest bots were A.I. crawlers.
Cloudflare CEO Matthew Prince wrote on X that he was surprised how quickly human activity was surpassed. He expected it would take another year or so
before the bots made up the majority of internet traffic.
CNN contributor Jacob Ward joins me.
When I read the story, I sort of had a mixed emotion on it. Part of me said, well, yes, but that was inevitable, bearing in mind the growth of
A.I., and I -- and the other part of me said, well, what does it actually mean that these bots are now doing most of it? And that's when we realized
we needed you to tell us.
JACOB WARD, CNN CONTRIBUTOR: Well, I appreciate it, Richard, and you are asking the right questions. I mean, it's a very complicated moment.
I mean, we have had -- it's been this notion floating around for a while. The "dead internet theory". This idea that the internet would no longer be
for humans, it would only be for robots in the future. This is something that's been floating around for more than a decade now. But now we are
actually in that place. We are seeing the data show us that that's the case.
And so, the downside, the thing that I think has everybody frightened in the short term is that this utterly destroys the conventional relationship
that humans are supposed to have with each other on the Internet. It destroys the ways in which internet content is built for human eyes and for
our taste. And as a result, it destroys all sorts of business models in the short term. All of that is really scary, I would say.
QUEST: But why does it destroy that? I mean, the fact that all these bots are making gazillion requests across the Internet for information, why does
that alter the way you and I would do a Google search, or would go shopping at a department store site online?
WARD: So, in the short term, right? Something like Google search results have driven a form of business since Google arrived. Right? Having your
search engine results push traffic to you was a core principle of being a web retailer or a publisher on the web.
Now, Google search results don't push that content and that audience anywhere, the eyeballs stay on Google as Gemini answers the question. So,
that's one problem.
The other problem, though, I think is a subtler one, which is the taste that you and I might have for content on the Internet has kept many, many
publishers and other forms of entertainment on the Internet alive, in spite, of the fact that all of the ads are sold in a programmatic way, in a
robotic way. And now, all of the choices of what it is that the agents go out -- these A.I. agents go out and find for you and bring back, will be
made by things other than just your personal taste, and so, it may be that if your content isn't perfectly made to be scraped by A.I., it will matter
that it's funny and pleasing and original for human eyes.
(CROSSTALK)
QUEST: OK. The A.I. revolution, the market today doesn't like what it is seeing. You saw the NASDAQ is off some four percent today. We have heard
economists, we have had Paul and Monica giving us that understanding.
From the industry's point of view, from the A.I.'s point of view -- companies. Do they get concerned when they see their valuations being
clobbered?
WARD: Oh, I think they have some concerns. Absolutely. I don't think it originates with Matthew Prince and what he has to say. He has made himself
something of a bet more in the Silicon Valley circles that I track, you know, people I think really roll their eyes at this guy's willingness to
sort of call out these big problems and describe these data points that are so disappointing to the public.
But I would also say, right, all of these A.I. companies understand that this is an enormous gamble, that there is clearly a market for this, as we
see enormous companies laying thousands, in some cases, tens of thousands of people off as they see this technology able to do it instead.
And now, that we're in the IPO season of all seasons, right? SpaceX will go public with it's A.I. technology inside it. Anthropic has now declared that
it will go public. OpenAI doing the same.
Now, we are in a world where everybody gets to see this incredibly expensive thing that everyone is building. These reams and reams, you know,
these -- just acres of data center that you are going to need in order to run these kinds of companies. Can you pay investors back for the money that
they give you to do that stuff?
I think these companies are absolutely in that sort of, you know, this has turned up the RPMs on everybody's expectations, and they are burning money
like never before.
(CROSSTALK)
QUEST: Right.
WARD: And so, the stakes are incredibly high for these folks. But I think all of them -- I'm always shocked at the near religious zealotry that you
hear from the top people of these companies about the utopia and the money- making opportunity that is definitely -- that they clearly believe with religious zeal is coming for them eventually.
QUEST: And I guess, the cynics in us look at them and sort of question that.
[16:45:02]
But somebody will be proven right before it's all over.
I'm grateful. Thank you, Jacob. Thank you.
A billion-dollar luxury resort project is sparking anger in Albania. thousands of people are taken to the streets in the capital to oppose the
project that's linked to President Trump's daughter, Ivanka, and her husband Jared Kushner.
Environmentalists say the project will endanger pristine beaches and the flamingos that nest there.
Government officials pushing back, saying it will help the country become a tourist destination.
CNN's Isa Soares reports.
(BEGIN VIDEOTAPE)
ISA SOARES, CNN ANCHOR AND CORRESPONDENT (voice over): Defiance and outrage in Albania's capital.
For several consecutive days now, demonstrators marching through the streets of Tirana, protesting a large luxury real estate project, backed by
the U.S. president's daughter and son-in-law. Ivanka Trump and Jared Kushner.
Demonstrations have been dubbed the Flamingo Revolution, because the site suggested for the luxury developments includes the island of Sazan and some
of the coastline near the Svenness wetlands and the Narta Lagoon, part of a protected area, home to seals, turtles, and thousands of flamingos.
The first protests started in spring when bulldozers were first spotted clearing land in this untouched corner of the Mediterranean.
But only gained momentum when private security were filmed clashing with protesters near the actual site early in the week. A day later, the issue
was amplified when Ivanka Trump shared in a podcast interview how she and Krishna stumbled upon the location during the visit in 2021.
IVANKA TRUMP, DAUGHTER OF PRESIDENT DONALD TRUMP: We were on a friend's boat and we stopped for a swim, effectively that's how we found it.
We swam to the islands, we went on a hike, barefoot all the way up to the top, and we were just captivated.
SOARES (voice over): Trump's romantic tale of causality and spontaneity, not mentioning an important detail.
JARED KUSHNER, SON-IN-LAW AND SPECIAL ENVOY TO PRESIDENT DONALD TRUMP: Prime Minister Rama came to the boat.
SOARES (voice over): Edi Rama, head of the country's government, impressing Kushner with his vision for Albania. In 2022, a year after that first
visit, Kushner decided to go back.
KUSHNER: So, we went there. We looked for opportunities, and we were able to find some incredible, incredible opportunities.
SOARES (voice over): A firm linked to Kushner and his partners obtained strategic investor status in 2024. A provision which, under Albanian law,
allows their project to be fast tracked by the government and regulators, and given certain tax exemptions.
Another law introduced in 2024, makes things even easier. By spelling out that luxury tourism developments can simply bypass legislation safeguarding
environmentally protected areas.
Two controversial rules Albania has agreed to repeal, as part of its accession to the European Union. With protesters accusing Prime Minister
Edi Rama of selling the country to the highest bidder. The head of the Albanian executive telling me, there isn't even a project yet.
EDI RAMA, PRIME MINISTER OF ALBANIA: There is not such a thing like a Trump family island. There is not such a thing like the family of the American
president taking over protected areas.
SOARES (voice over): Rama saying environmental studies to measure the impact of building on this landscape are ongoing.
While the company behind the project says its focus remains on responsible stewardship, environmental enhancement, job creation, and creating long
term value for local communities, echoing what Kushner and Trump have also said about the project themselves.
KUSHNER: If we don't respect the environment, the development we're going to create there won't be as special.
I. TRUMP: Because the land is so beautiful that really the architecture has to be fully integrated into it.
SOARES (voice over): It's unclear whether the bulldozers currently operating near the Narta Lagoon are connected to the Kushner-link luxury
development. But protesters and environmentalists believe the government, despite their many denials, is hiding something.
MELITJAN NEZAJ, ENVIRONMENTAL BIOLOGIST, ALBANIA: As we speak now, there are no permissions publicly available. The government is saying that we
have a permission to the investors to develop the area, but we don't have anything else, like everything else is like darkness for us and for the
public.
SOARES (voice over): And so, until some light is shed, they say these flamingos are going nowhere.
(END VIDEOTAPE)
QUEST: When we come back in just a moment, high school students across the United States tested their financial literacy in a finance competition this
week.
We'll see. I'm dreading this. Am I as savvy as the 16-year-old? In a moment.
(COMMERCIAL BREAK)
[16:52:25]
QUEST: U.S. high school students are showing off their financial knowledge. It's the National Personal Finance Challenge Test, and it tests them on
topics ranging from managing credit to earning income.
For many of these students, it's more than just a friendly competition; it's a reminder for all to become more financially literate.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: If retirement tax liability is greater than current tax liability.
UNIDENTIFIED MALE: Coinsurance, 10 percent.
UNIDENTIFIED FEMALE: Microsoft, Google, Nvidia, Apple, Amazon.
UNIDENTIFIED FEMALE: Do you think you know more about finance than the average adult?
PRANAV BOREDDY, HIGH SCHOOL STUDENT: Than the average adult? Probably, yes.
UNIDENTIFIED FEMALE: High school students from across the U.S. flex their financial literacy in the national personal finance challenge.
JIWOO JEONG, HIGH SCHOOL STUDENT: A lot of adults undermine how important personal finances, whether it's because they didn't have the resources or
they just simply didn't emphasize it enough. But I think a big push that we should have is educating not only children but also adults about financial
literacy.
UNIDENTIFIED FEMALE: U.S. government bonds, whose principal value adjusts based on the consumer price index, are known by what acronym?
UNIDENTIFIED MALE: TIPS.
UNIDENTIFIED MALE: The correct answer is TIPS.
UNIDENTIFIED FEMALE: A team of four students from Mt. Hepburn High School in Ellicott City, Maryland, won first place.
VISHVA RAO, HIGH SCHOOL STUDENT: What piqued my interest in finance is the relevance of the subject. We are in a world where, if you don't know your
finance, it's very hard to live.
DAKSH MATHAPATI, HIGH SCHOOL STUDENT: On an everyday basis. We always have something financial going on, you know. Either going to the grocery store
or buying concert tickets, you need to know how to save your money or when to spend your money.
Everything runs with money, everything runs with transactions, and you really need to learn your personal finance to stay ahead of where our world
is going.
BOREDDY: We are about to step into a world of like college in the future and working, so, for the first time in our lives, we are going to have
money and we are going to be able to spend to do what we want with it. It's really important that we are able to understand how to manage and be able
to put our money to work, so that in the future, in the long run, we can reap the reward of our own hard work.
(END VIDEOTAPE)
QUEST: All right. Now, for ritual humiliation, the QUEST MEANS BUSINESS team has decided to test my financial knowledge. They are asking me a few
questions from that competition. So, the first one is here.
There is the bell.
Which of these is not in the magnificent seven group of hot tech stocks: Alphabet, Apple, Palantir, or Tesla?
I would say Palantir. Yes. Well done.
How many members are on the FOMC, the Federal Open Markets Committee?
[16:54:59]
I believe it is 15. It's either 12 or 15. I'm going to go for -- hang on. There is -- you have got the seven governors, and then, you have got the --
maybe it's 12. Let's go for 12.
Yes.
What does a downward sloping yield curve usually indicate about expected future interest rates?
Nothing, rates will stay the same; rates will fall; rates will rise; rates will fall, and then quickly rise again.
This is the yield curve. I think, it talk about -- indicates -- well, let's see, that stuff. What does a downward thing. Oh, I have no idea.
Absolutely.
Rates will fall. That's wrong. It's wrong. I know it's wrong, before. Oh no, it's not. There we go.
Now your personal finances may have taken a hit today. Well, just look at the markets and see how they performed.
Believe me, I am surprised I got those right. Wall Street closed sharply lower with chip stock selling off after a torrid week of gains. The S&P 100
broke a nine-week winning streak. It posted its worst session since October.
And if you look at the NASDAQ, the worst session since April of last year. Now, the Dow lost 1.3 percent.
The Dow 30 shows the rotation out of tech. P&G finished on the top, up four percent Strong sessions from Coca-Cola and Travelers. Not surprisingly,
Cisco and Nvidia, IBM, they were the -- they bore the brunt, down five percent We will take a "PROFITABLE MOMENT" after the break.
(COMMERCIAL BREAK)
QUEST: That's "PROFITABLE MOMENT". I was foolish today. I chose to look at my portfolio and my 401(k) and pensions, and not surprisingly, because they
are all stuffed to the gills with mag seven and the like, they were down very sharply. Frighteningly sharply. To the point where one thinks, if this
is -- continues, we -- one would be in trouble.
But we sort of know it's not going to continue until it does. We sort of know that the market will recover because A.I. is the only game in town, at
least it seems to be for the time being with the market.
What is interesting about today's market is that the focus is all on the stocks, not on the economics. It's not on the Gulf, and it's not on the war
in Iran and the price of oil. It's about those individual stocks that make up the A.I. contingent that have been roaring ahead for so far and so fast.
[17:00:08]
And as my producer very helpfully said in my ear that I may have looked at my portfolio and know that it will recover, but one day it might not.
And on that cheerful note, thank you, Ronan (PH). Because that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York.
Whatever you are up to in the hours ahead, I hope it is profitable.
END
