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First Move with Julia Chatterley
In China, The Death Toll Spikes Over The Weekend As The Coronavirus Continues To Spread; Basketball Players And Fans All Stunned By The Death Of Kobe Bryant; On Capitol Hill, President Trump's Defense Team Takes Center Stage Again As Details From John Bolton's Manuscript Emerge. Aired 9-10a ET
Aired January 27, 2020 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:01:05]
ZAIN ASHER, CNN INTERNATIONAL ANCHOR: Live from New York Stock Exchange, I'm Zain Asher, and here is what you need to know.
In China, the death toll spikes over the weekend as the coronavirus continues to spread.
And mourning Mamba. Basketball players and fans all stunned -- stunned -- by the death of Kobe Bryant.
And on Capitol Hill, President Trump's defense team takes center stage again as details from John Bolton's manuscript emerge.
It is Monday, and this is FIRST MOVE.
All right, a warm welcome to all of you. So good to have you with us on this very, very busy and certainly sad Monday.
Let's begin though, before we get to the news about Kobe Bryant, let's begin with a quick check for you of the U.S. markets.
U.S. investors are bracing for a steep selloff here on Wall Street. All the major U.S. averages on track to fall almost one and a half percent or more
as coronavirus fears grip global markets.
U.S. stocks are coming off their worst week of trading since August with the Dow set to begin the session below the 29,000 milestone it hit earlier
this month.
European stocks are in risk off mode as well. German, French and U.K. markets are currently down by well over two percent. In Asia, Japanese
shares finished the session down more than two percent. Hong Kong and Shanghai exchanges remain closed for the Lunar New Year holiday.
Safe haven assets continue to perform well as global health officials report more coronavirus cases. The yields of the U.S. 10-year Treasury has
fallen to 1.6 percent, that is its lowest level since October and gold is up over half a percent just showcasing really all the fears a lot of people
have.
Meantime, crude is trading sharply lower amid fears that the worsening health crisis could slow global growth. Oil has fallen to nearly three-
month lows.
The spread of the coronavirus remains our main driver -- our main story this Monday.
China is in emergency mode as authorities race to rein in the contagion. New details over the weekend reveal the scale of the outbreak. We now know
that 80 people have died and almost 2,800 cases confirmed in total. Fifty seven million people in 15 cities remain in lockdown.
The Lunar New Year Holiday has been extended by three days. Businesses across the country are closed. Outside of China, dozens of cases have been
confirmed in at least -- in at least -- 13 locations.
David Culver joins us live now from Beijing. So David, if it is indeed true -- if it is indeed true that the virus can actually spread before symptoms
show, how does that complicate efforts to contain it?
DAVID CULVER, CNN CORRESPONDENT: This is incredible troubling, if it is, in fact the case, Zain, because the reality is, according to health
officials is that a lot of this is still really unknown.
But here's what they suspect is a possibility, is that during the incubation time, the one to 14 days that they believe somebody may have
been exposed and could potentially contract the virus themselves. That period is also a risk to other individuals that that person comes in
contact with.
They say that person could potentially spread the virus even further without even knowing it. So why is that an issue? Well, look at the
screening mechanisms that are currently in place.
You've got airports, railway stations, and even hotels that will check the temperature of individuals as they either come into a country or even come
into a building, and that's an assessment of whether or not they're running a fever.
That in of itself, is not enough if this is something that could last far longer than that. For example, two weeks that somebody could potentially be
capable of transmitting that.
So if they come into the country, they're not showing any symptoms, then you've got a long duration in which there's a potential risk there.
[09:05:07]
CULVER: Now, that's obviously still so early to be confirmed, but it's suspected and that is enough to have territories and other countries
reacting.
We know that Hong Kong, for example, has issued a ban on anyone who has recently been in Hubei Province or is from Hubei Province, they can't come
into Hong Kong for at least two weeks' time.
In Singapore, any students or staff members from schools who have been in Mainland China -- anywhere in Mainland China -- cannot come back into the
schools for a two-week duration. So it's clearly having an impact -- all of this as containment efforts are moving forward.
We know that the construction of not one, but two new hospitals is currently underway. State media reporting that this construction is rapidly
happening. They're expected to open one of them within six days, the other within two weeks' time combined to hold more than 2,000 patients.
Now all of this as the World Health Organization has their leader here in Beijing meeting with health officials, trying to get a better
understanding, Zain, as to how this virus spreads, what it's all about, and what can be done to stop it.
ASHER: David Culver, live for us there. Thank you so much. Stocks around the globe are falling as investors weigh the economic risk of the outbreak.
Anna Stewart is joining us live now. So Anna, I mean, this is a real cause for concern for any company, not just in the U.S., but around the world
that has deep exposure to China.
ANNA STEWART, CNN REPORTER: Yes, and we're seeing a lot of reaction today. I'd say the market reaction last week was a little more mixed. Today, you
can see investors really taking into account the very real risk of slower economic growth in China and the knock-on effect for many sectors are.
To Asia and Europe, only the Nikkei opened today really, the main market. Chinese market is closed, of course, the Chinese Lunar New Year, but you
can see the Nikkei down a couple of percent, I believe, if we can bring those up.
Also we have the European indices. They were all in the red this morning. The FTSE 100, the CAC 40, the Xetra DAX, and sector-specific. If you look
at the stocks that are really being impacted, it is those that have high influence with China. Luxury stocks, particularly.
Take a look at LVMH, Dior, Kering and Burberry, all heavily in the red. They are very reliant on the Chinese consumer, both in China, but also of
course, there's Chinese consumers traveling around the world and that is also why travel stocks are down.
The risk to travel, not just the big long haul airlines actually like IAG and the British Airways or KLM, but also EasyJet, that's a short haul
carrier. It does not fly to Asia. But you can see the impact there as more people just worry about traveling more generally.
And looking more at the economic picture, the risk for factories being shut. Shops being shut. Travel restrictions means the output, consumption
all likely taking a hit, and there you can see the mining stocks down as well, down four percent for Glencore, and for BHP Billiton, worries, of
course, that the demand for raw materials will slump as a result of their lack of output and consumption -- Zain.
ASHER: And just in terms of oil more specifically, because obviously the Chinese economy is deeply linked with the rest of the world, and that
means, of course the commodity markets are going to be affected. How has oil specifically been impacted by this?
STEWART: Yes, we're seeing a big slump actually in oil today. We will bring up those prices for you. China is the biggest importer of crude oil.
So you're really not surprised that you see this reaction there. Brent crude down three percent. WTI similar actually.
What we're seeing here, Zain, is perhaps more sentiment base because the knock-on effect for demand in oil will likely be further down the road. So
analysts are hoping that perhaps this will be short term depending on what happens with a virus next. Will a vaccine be found? Will we see it starting
to spread less quickly?
A lot of attention on a SARS outbreak of 2002-2003 to kind of guesstimate how markets might react in the next few weeks. That knocked two percent of
GDP, of course, the GDP in China in 2002-2003.
Currently, expectations are for this not to be as bad. So far the virus doesn't appear to be as deadly, but of course it's very early stages --
Zain.
ASHER: All right, Anna Stewart live for us. Thank you so much.
All right, this is a sad one because we are all deeply moved, deeply saddened and just hurt quite frankly, by the death of a basketball legend.
Emotional tributes are pouring in from around the world after Kobe Bryant died in a helicopter crash at age 41. I still cannot believe that I've just
said those words.
The chopper, we know, went down near Los Angeles Sunday morning, killing all nine people on board, including Bryant's 13-year-old daughter, Gigi.
The crash happened under foggy conditions. Investigators are working to determine what exactly caused the accident. The group was traveling to
Gigi's basketball game. She followed in her dad's footsteps.
[09:10:06]
ASHER: Andy Scholes joins us live now. So Andy, I just -- what a sad day? I mean, what is there to say? I can't believe I've just uttered those
words. I can't believe I'm speaking about Kobe Bryant in past tense now. All of our hearts here are so heavy.
I know that you interviewed him just two weeks ago. You were a fan of his. Walk us through what he meant to you and what his personality was like.
ANDY SCHOLES, CNN SPORTS ANCHOR: Yes, I mean, Zain. I, like many was a huge fan of Kobe Bryant and, you know, my heart sunk when I saw the news
alert come across on Sunday of this tragic accident.
And one of the reasons I was a big fan like so many others was Kobe's work ethic, his relentless drive to just be great, it was unmatched. He inspired
so many people around the globe with that work ethic.
You know, we may never see another athlete like Kobe, ever again. And you know, Michael Jordan's career was winding down in the 90s. You know, NBA
fans, you know, they feared what would happen to the league without Michael Jordan? Well, you know, Kobe Bryant more than carried that torch.
He came into the league, Zain, you know he was going to be the next great one. He was going to be the next Jordan and one thing about Kobe, you know
he talked the talk and he certainly walk the walk backing up what he said with just amazing accomplishments.
Five NBA championships, you know, NBA arenas around the country are holding moments of silence on Sunday. The Spurs and Raptors both taking a 24-second
shot clock violation to start the game in order to honor Kobe. Kobe, of course wore the number 24 to the end with his Lakers career.
It is certainly the most devastating day in NBA history. Many players around the league just in tears as they took the floor for their games.
Many also getting emotional while they were playing out there on the floor.
And Dwyane Wade, he retired from the league last season. He was good friends with Kobe and he shared this emotional message.
(BEGIN VIDEO CLIP)
DWAYNE WADE, FORMER NBA PLAYER: We will forever, forever miss you, man.
You're a legend, you're an icon. You're a father, you're a husband.
You're a son, you're a brother. You're a friend. Thank you for being my friend. I love you, brother.
(END VIDEO CLIP)
SCHOLES: And Kobe's old running mate, Shaquille O'Neal who he won three championships with also very emotional. He posted, "There's no words to
express the pain I'm going through with this tragedy of losing my niece, Gigi and my brother, Kobe Bryant. I love you and will be missed."
Michael Jordan also weighing in saying, "I am in shock over the tragic news of Kobe and Gianna's passing. Words can't describe the pain I'm feeling. I
loved Kobe. He was like a little brother to me. We used to talk often and I will miss those conversations very, very much."
And Zain, you know, I was, you know, lucky enough to actually interact with Kobe in two sectors of my life. You know, I was actually a ball boy for the
Houston Rockets when I was in college. And when I sat down with Kobe, just 12 days ago, I showed him a picture of me and him from 2003 and he laughed
and said, we were both youngsters back then.
And I actually took that opportunity, Zain, to thank Kobe, for just being so nice to everyone. You know, he was one of the best players. He was the
best player in the NBA back then, and he still took the time to take pictures with everyone, sign autographs for everyone.
It's something that a lot of superstar players just don't do. And when I think Kobe for being so nice to everyone, Zain, he just smiled at me and
nodded and you know, that's a memory I'm going to cherish forever, and that's just who Kobe was. He was a nice genuine person, and the loss of him
and Gigi and everyone else who was on that helicopter with him is such a tragedy.
ASHER: Yes, you can really feel the sunlight of his spirit, he just seemed like such a beautiful person. Andy Scholes, thank you so much.
We wish Kobe Bryant a safe journey home. Andy, thank you.
All right, these are the stories making headlines around the world. President Trump is denying he told John Bolton that aid to Ukraine was tied
to an investigation into the Democrats including Joe Biden and that contradicts and unpublished draft manuscript written by Bolton about his
time as the President's National Security adviser.
The manuscript has been leaked to "The New York Times" and Suzanne Malveaux is joining us live now from Capitol Hill with the latest.
So, Suzanne, how dangerous could John Bolton actually be for the U.S. President?
SUZANNE MALVEAUX, CNN U.S. CORRESPONDENT: That's a very good question, Zain, because as you realize, it was just over the weekend that the White
House counsel's team presented their opening arguments, had a chance to talk to several senators, Republican senators who all expressed a great
deal of confidence that they made their case and that this would be wrapped up this week.
But this is really a game changer, a potential game changer when you have these comments coming from the National Security adviser, John Bolton in
this transcript, this excerpt from his upcoming book.
It could be very damaging and it really renews the call and the case that Democrats are making for the need for direct witnesses like John Bolton as
well as documents.
(BEGIN VIDEOTAPE)
MALVEAUX (voice over): In just hours, President Trump's defense team will make its case against Trump's removal from office.
[09:15:00]
MALVEAUX (voice over): But explosive new details from former National Security adviser, John Bolton's impending book could now change the
direction of the trial.
A report and "The New York Times" describes dozens of pages in Bolton's unpublished manuscript on how the Ukraine matter evolved in the months
before he left the White House last September.
Bolton claims President Trump told him in August, they should continue to hold nearly $400 million in military aid to Ukraine, until officials there
helped with investigations into Democrats, including the Bidens, undermining a key pillar of the President's impeachment defense that the
two circumstances are unrelated.
A source with direct knowledge of the manuscript tells CNN "The New York Times" telling of Bolton's account of the Ukraine aid whole discussion with
Trump is accurate.
President Trump denying Bolton's claims tweeting, "If John Bolton said this, it was only to sell a book."
(BEGIN VIDEO CLIP)
DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: I don't know if we left in the best of terms, I would say probably not, you know, and so you don't
like people testifying when they didn't leave on good terms.
(END VIDEO CLIP)
MALVEAUX (voice over): "The Time" says the book also details conversations Bolton says he had with key Cabinet members, including Secretary of State
Mike Pompeo and Attorney General Bill Barr.
(BEGIN VIDEO CLIP)
SEN. BEN CARDIN (D-MD): I think Ambassador Bolton is an important witness to hear from directly. There's a lot of missing blanks here that it would
be helpful if we could have the direct testimony in order to complete the record.
(END VIDEO CLIP)
MALVEAUX (voice over): In a joint statement, the House Impeachment Managers urging the Republican senators to vote to allow new documents and
witnesses, writing, "There is no defensible reason to wait until this book is published, when the information he has to offer is critical to the most
important decision senators must now make whether to convict the President of impeachable offenses."
Before "The Times" report, Republican leaders were confident that they would defeat the vote this week, but now it is less certain according to
three G.O.P. sources.
(BEGIN VIDEO CLIP)
SEN. AMY KLOBUCHAR (D-MN), PRESIDENTIAL CANDIDATE: I don't know how my Republican colleagues cannot call for witnesses. Senator Romney has called
for witnesses. They should all be calling for a witnesses. We have to get to the truth.
(END VIDEOTAPE)
MALVEAUX: And Zain, and it was just moments ago, I had a chance to speak to Senator John Cornyn, a Republican from Texas, part of the Republican
leadership, and I asked him about whether or not this was in fact, a game changer here and he simply tried to blow it off, if you will, or make it
less significant saying, well, this is consistent with what the House Managers -- Impeachment Managers have been arguing all along.
But Zain, what is not consistent is that this is Bolton's firsthand accounting. This is not hearsay. This is a direct link to the President,
and to that he did not have a response. He also said that he would wait until the White House counsel would conclude its own argument before making
that decision or any kind of announcement on witnesses.
So far, Cornyn and many of the other Republican have been against that calling for this to get over with very quickly -- Zain.
ASHER: Suzanne Malveaux, thank you so much.
U.S. President Donald Trump is set to meet separately with Israeli leaders Prime Minister Benjamin Netanyahu and his political rival, Benny Gantz. Mr.
Trump will unveil the long-awaited peace plan for ending the Israeli- Palestinian conflict.
The deal spearheaded by President Trump's senior adviser and son-in-law, Jared Kushner is expected to address the status of Jerusalem and the fate
of Palestinian refugees.
Okay, this is FIRST MOVE. Still to come here with tens of millions of people on lockdown in China, how is the coronavirus hitting the world's
second largest economy?
And following the tragic death of Kobe Bryant, we'll take a look at the business empire of one of the world's greatest basketball players ever.
(COMMERCIAL BREAK)
[09:21:52]
ASHER: Welcome back to FIRST MOVE on yet another challenging day for global investors. Stocks are extending their losses from late last week as
health officials attempt to halt the spread of the coronavirus.
The U.S. now has reported its fifth -- its fifth -- coronavirus case. U.S. stocks are set to fall one and a half percent or more when trading gets
underway in about eight minutes or so from now.
European stocks are already sharply lower, down by well over two percent right now. All the major U.S. averages fell from record highs last week,
dropping about one percent. The Dow has fallen for four straight sessions.
It could drop into negative territory for the year in early trading today.
Leland Miller is the CEO of China Beige Book. He joins us live now.
So if you think about what China has actually been through economically, obviously, we talked about the slow down. Then we've also talked about the
trade war between the U.S. and China. We did get the Phase 1 trade deal signed, but it's important to remember that there are several tariffs still
in place before we get to Phase 2.
And now this. What is going to be the long-term fallout of the coronavirus?
LELAND MILLER, CEO, CHINA BEIGE BOOK: China can't catch a break right now. Look, this should be a relatively short term episode. By short term, I mean
several months. You're in the escalation period right now. You're not going to see -- we'll probably see a terrible February, it could go into March
and April.
But this is something that should be a multi-month story, but not something that's going to tear the economy from its foundations in 2020, unless we
see something change, unless we see the response by the government not sufficient enough, unless we see, you know, even more widespread disbelief
over the type of figures and health information that China is sharing with the rest of the world.
But this should be a relatively short term story, but the short term could be quite bad.
ASHER: Okay. So just in terms of the short term specifically for certain segments of the market, we should be looking closely at airline stocks. We
should be looking at any kind of company that has exposure to China especially retail, consumer goods, that sort of thing.
MILLER: Yes, and we're talking about travel and tourism. Those are getting wiped out right now. Most consumer stocks, people don't want to go out and
shop. They don't want to go out. They don't even to want to commute to work.
China is even shutting down certain places of work and property offices are being closed. And you know, I'm sure manufacturing is taking a big hit
starting next month when people aren't going to want to go to the factories.
So in the short term, you're going to see a particularly big dent in anything related to travel or consumption, and the problem with that is,
this is Lunar New Year period. This is supposed to be the highlight of the year.
So the numbers are going to be ugly, no question. It's just whether this is going to continue past three or four months from now.
ASHER: And China is also the largest importer of crude oil, isn't it? So that also has global complications as well.
MILLER: Well, this is going to have a big effect on oil. People think that Chinese growth is slowing down. They think that China is building less,
that oil is going to take a big hit, and you're already seeing that pressure on markets.
ASHER: Okay, so what -- just to sort of look at the glass half full and see the more positive angle to the story. What is it going to take to
actually reassure investors that the Chinese government has got this under control?
[09:25:05]
MILLER: Well, I think there has to be transparency and there has to be confidence in the level of transparency with what the Chinese government
has been putting forward. There has not been so far. I think if you look at how this started in Wuhan, it started as a cover up. Now, whether it was
local officials or central government officials, this is the story of China.
And so I think there has to be confidence that the Chinese government is telling the truth, that it's sharing the requisite information with global
health officials, that they've done sufficient amount to ring fence problematic areas, that there's enough effort going into stopping flows of
people in problematic ways.
There just needs to be a higher level of confidence in the action of the Chinese government. You're seeing a much stronger response over the last
few days, but it's still not enough.
ASHER: So, you mentioned just during the commercial break to me that this has actually crossed from being a micro issue to now a macro issue. When
did that crossover actually happen? Can you pinpoint it?
MILLER: I would say over this past weekend, when you saw Saturday morning from the levels of infected from Saturday morning to Sunday afternoon even
jumped dramatically. So you're seeing just a very contagious disease. There's some distant debate into how contagious it is, but you're seeing
this spread out quite rapidly.
You've got the Lunar New Year where everybody is traveling everywhere else.
ASHER: They've extended it.
MILLER: They've extended this, and right now I think the key is just trying to figure out how they can contain this and stop the spread. If
every person is supposedly affecting two and a half other people, we've got a real problem unless you put in the right safeguards.
ASHER: All right, Leland Miller, live for us, thank you so much.
Okay, you are watching FIRST MOVE. The opening bell is coming up after this short break. Don't go away.
(COMMERCIAL BREAK)
[09:30:00]
ASHER: All right, that was the opening bell, starting another trading week here on Wall Street at the New York Stock Exchange. I'm Zain Asher. You
are, of course, watching FIRST MOVE.
And as expected, U.S. stocks are tumbling right now right out of the gate. Look at the red across your screen. The Dow is actually down almost 550
points. All the major averages are down, well over one percent as the global health officials attempt to contain the deadly coronavirus.
More than 2,700 people have now contracted the illness and some 80 people have died. That number sadly continues to rise.
There are many other challenges facing investors this week. More than 140 companies in the S&P 500 are set to report fourth quarter results including
heavyweights like Apple, Facebook, Microsoft, Amazon, and Boeing.
The Fed meets to discuss interest rates for the first time this year, and the Bank of England holds its policy meeting on Thursday, one day before
the U.K. formally leaves the E.U. on January 31st, this Friday.
Time now for a quick check of our Global Movers. Coronavirus fears on triggering fresh losses for airline stocks. Shares of Delta and United are
both down sharply again. Casino stocks exposure to Chinese market are seeing shares tumble. Losses for Las Vegas Sands and Wynn Resorts are
outpacing the rest of the market.
Report say the number of Mainland Chinese visitors to Asian gambling hub, Macau has actually plunged 80 percent since the outbreak.
Sameer Samana joins us live now. He is the senior Global Market Strategist at Wells Fargo Investment Institute. Sameer, thank you so much for being
with us.
So as the death toll and the impact of the coronavirus continues to rise, what do you imagine the long term impact to be on the Chinese economy as a
result of this, especially when you consider it in the wake of SARS 20 or so years ago?
SAMEER SAMANA, SENIOR GLOBAL MARKET STRATEGIST, WELLS FARGO INVESTMENT INSTITUTE: Sure. No, thank you so much for having us. And, you know, what
we would say is, you know, a lot of what the Chinese have been trying to do over the last few years is this program slow down, as they move from a
manufacturing based economy to a consumption based economy. And this unfortunately, kind of strikes right at the heart of that.
So at least right now, you know, we'll have to wait and see what the numbers look like in terms of consumer confidence and retail sales in
China. But the real tricky part is going to be how do Chinese authorities respond not only to the outbreak, but then do they try and stimulate the
economy and get those consumers to kind of come back out?
ASHER: But just in terms of specific sort of U.S. companies that are going to be affected by this, it's any company that's exposed to travel, tourism,
retail, luxury retail, consumer goods. We are seeing airline stocks get hit by this. Just walk us through which industries are going to be extremely
nervous right now.
SAMANA: So, you know, there's already reports of some restaurant companies from the U.S. closing down stores in China. So you know, travel and you
know, leisure and again, all of those discretionary spending things that, you know, folks do when we go out of the house are probably going to be the
first place that starts to get hit.
A second one that I would throw out there would be, you know, we've already seen the weakness in energy prices, and this is putting further downward
pressure. And so you're starting to see that kind of find its way into the market through high yield energy spreads. So that's an additional pressure
point that's to be watched.
ASHER: And so just in terms of specifically crude oil, obviously, crude oil suffer as a result of this, but China is the largest importer of crude
oil in the world. So what will the domino effect be for the global economy?
SAMANA: So I mean, if we were to have some type of broader spill out into, you know, let's say energy prices, you know, kind of ending up back in
there 15-16 lows, I mean, we all kind of remember what high yield spreads did back then. And you know, you've already seen natural gas, you know,
break below $2.00 per BTU.
So, you know, again, we'll have to kind of make sure that, you know, crude oil kind of hangs in there. Now, you know, OPEC Plus has kind of been, you
know, stabilizing the market over the last few years, they may have to step in and cut some more.
So, you know, there is that cartel that's kind of become much more effective over the last few years. But if oil prices were to break
meaningfully below 50, it does call into question some of the profitability of some of these smaller companies.
ASHER: And just in terms of the response we're seeing, from the Chinese authorities, what type of response is the market looking for, in order to
get that reassurance?
SAMANA: I mean, I think, you know, for the most part, the response has been kind of what the market is hoping for, which is the Chinese
authorities have been much more transparent than they have in the past. They seem to be moving with much more speed than they have in the past.
[09:35:01]
SAMANA: The tricky part is, you just have, you know, this virus, which you know, is being, you know, transmitted almost before the symptoms show up,
and so it's a little bit tricky to try and figure out exactly how to quarantine and contain it, and so that's going to be the key, you know,
again, time and the authorities continue to work the way they have been.
So, you know, from that standpoint, I don't think the market is worried. I think the bigger issue is how we were positioned prior to the news of the
virus breaking out was so extreme on the bullish side that unfortunately, this is really at this point, kind of a pullback, but it's just, you know,
it feels that much more severe, given, you know, how quiet right to the upside we were seeing to start the year.
ASHER: And obviously, this is an event that the market was clearly not prepared for at all. It could actually have a lot of, just at least in the
short term, significant damage on the Chinese economy. But we now know that the Chinese Ministry of Finance is actually allocating about $8.7 billion
to help stop the spread of the virus. Does that assuage the market somewhat?
SAMANA: You know, hopefully. I mean, again, you know, just the authorities need to keep up what they're doing, which is to be transparent, to make
sure that they're acting, you know, expeditiously.
And, you know, again, unfortunately, you know, we've got a very heavily populated world with a lot of travel going on, and so it's probably going
to take a little bit of time and unfortunately, that's what markets hate is uncertainty and having to wait and that's probably going to be something
that you know investors will have to kind of manage. It is that waiting game and their emotions you know, as they hear the headlines coming out.
ASHER: Sameer Samana from the Wells Fargo Investment Institute, thank you so much.
Coming up, how Coca-Cola plans to tackle environmental issues while continuing to use plastic bottles? That's next.
(COMMERCIAL BREAK)
ASHER: Climate change was the headline at this year's World Economic Forum. Many businesses laid out plans to address the issue. Coca-Cola says
it will focus on collecting and recycling as the company plans to continue its use of plastic bottles.
In Davos, Julia Chatterley discuss Coca-Cola's efforts to fight climate change with CEO, James Quincey.
[09:40:13]
(BEGIN VIDEOTAPE)
JAMES QUINCEY, CEO, COCA-COLA: Oh, it's great we're having a debate. I mean, we've been doing some things, actually we've made some progress, but
there's much more we have to do, even though we were in narrowly -- we've got to do a lot more.
And I think that that's why the debate is good, because the real learning is there's no way one company, one government, one better society can
actually help us get over the line on what's really the solution, we actually all need to come together.
And it's possible, there are many things we can do to get the ball rolling, to be in a better position to face some of the issues we have on the
environment and on sustainability. It's doable.
JULIA CHATTERLEY, CNN INTERNATIONAL ANCHOR: What do you mean by all coming together, though? Do you mean a kind of not just big business in one
country? Do you mean countries all collectively like a Marshall Plan effectively for climate change, if that's what required?
QUINCEY: I think there are different solutions for different bits of the problem. There are some things that are profoundly local and then it's the
companies in that locality, the local government or the national government, civil society, and the solution can be done there.
There are some things that need a broader agreement whether that be some way of pricing in the types of carbon, the way your energy comes, whether
it comes with dirtier carbon or less dirty carbon -- that needs a broader agreement, whether it's regional or global.
So there are some things that a multilateral and global and there's some things that are profoundly local, and we can get those things done even
while we're waiting for the bigger answers.
CHATTERLEY: Water neutral in 2016, you beat your targets; 25 percent reduction in carbon this year; 2030, fifty percent recycle content in terms
of your bottles, but it's even bigger than that.
QUINCEY: Yes, by 2030 we want to collect one bottle comeback for every one we sell. The aim is to stop talking about where the plastic is good or bad,
the philosophical counterbalance and say, what we really need is zero waste, nothing to the environment and a much lower carbon footprint.
And the solution to that is actually to bring the packaging back, the plastic bottles and plastic, if we can get them back, they are great
materials. They can actually just be remade into new bottles and cans, and you can truly get a circular economy, radical reduction in the use of
resources, no waste to the environment.
It's a fantastic environmental solution. It's a fantastic carbon footprint solution. There's no waste, it really can be done. And we already have
countries in our business system where the collection is over 90 percent and we will very soon have the first country where all the packaging is
made from 100 percent recycled plastic. It's doable.
CHATTERLEY: Where are you doing that? Where are you almost there?
QUINCEY: The first country is going to be Sweden.
CHATTERLEY: I guess, I'm not surprised.
QUINCEY: Well, yes, I mean, the countries that are more organized in the advanced economies around collection are places like Scandinavia and
Germany. We already have over 90 percent collection.
There are emerging markets where we're well over 70 like Mexico and South Africa. We know it is doable. The key to get over is collection, then we
can have a fully circular economy.
CHATTERLEY: Greta Thunberg came here and she said, net zero is not enough, wants real zero in terms of carbon emissions. And you know, I've spoken to
some CEOs and some business leaders who said, then turn off all the lights, then stop all the cars. That's not feasible. What would real zero mean for
your business? Do you feel like we need a bit of a reality check?
QUINCEY: Yes, again, I think we have to start with what's our objective? What are we trying to solve for and we're trying to solve for the
increasing temperatures? Absolutely, we need to bring down carbon emissions.
And we know that the people who are poor today deserve access to the same sort of lifestyle we have. So there's going to be pressure on growth come
what may. You know, those people are going to vote in politicians that want growth.
So we have to understand that the people who vote in the politicians that decide the policy are going to ask for growth. They're going to demand of
the government and of the companies that we solve the problem and deliver them growth. If not, they'll just choose another set of politicians.
CHATTERLEY: Right.
QUINCEY: So I think that's what we have to focus on. Where are the solutions that can largely continue to have the same lifestyle or better,
maybe different ways and save the planet? That's the space where people can get energized.
The thing that will bring the consumers in is if you can have the same thing you've got today or better with a much lower carbon footprint, you'll
come with me tomorrow.
CHATTERLEY: Talk to me about opportunities as you head forward. Coke plus coffee? Coke energy? Now, there will be people watching who know about my
Diet Coke habit, so I shouldn't be leading the witness here, but really? Coke Energy and coke plus coffee?
QUINCEY: Yes.
CHATTERLEY: It's working.
QUINCEY: They are experiments. You know, the Coke franchise is interesting and vibrant and people love it. And these variants, whether it be the Coke
Plus with the coffee or the Energy, it's interesting and people -- it brings people into the franchise. It gives them an experience of Coke. Some
of these experiments will not work and will fail and have to be sidelined.
[09:45:10]
QUINCEY: And some will be fantastic and great and stay with us well into the future.
CHATTERLEY: Where are the biggest growth opportunities for you?
QUINCEY: We're a global business. We're literally almost everywhere.
CHATTERLEY: But ensuring up businesses in emerging markets, you're looking, I think, at your supply chains as well. You've made a significant
amount of tweaks, I think, to focus on.
QUINCEY: We have, and there will always be tweaks to go on. But we truly are a global business and therefore, there's stuff happening in every
region, like we've got good growth in the U.S.
CHATTERLEY: Yes, you do.
QUINCEY: We've got good growth in Europe, Latin America, the emerging markets over time will become a bigger and bigger part of the story. The
reality is, it's a business that sells, you know, a relatively affordable option to enjoy yourself or hydrate yourself or whatever, and therefore
it's related to the number of people. And the number of people, there's a lot of people in Asia.
So the center of gravity, if you like of the business is slowly shifting east and that's going to be part of our future. Of course, there will be
ups and downs in the countries. We will offer different drinks in different places, but the center of gravity will slowly shift East.
CHATTERLEY: Interesting. And you're comfortable with that?
QUINCEY: Yes, what's great about this business is people see us as global, but actually it's truly local. Every drink that you drink in a country,
whether it's Switzerland or the U.S. or wherever was made in that country, and therefore it can expand naturally.
CHATTERLEY: What's going to be the biggest challenge?
QUINCEY: Some of the biggest challenge over the last few years has been parking the vision to the dark clouds on the horizon and some of the
pessimism in the air and actually focusing on the business that we run and the consumers we engage with. They're actually in a pretty good space.
The clouds are kind of still floating there trying to kind of get their way in, but the consumer is in a pretty good space. So we stay focused on them
and our business, I think, things will be better.
CHATTERLEY: And you're confident.
QUINCEY: I am never confident, but I'm optimistic.
(END VIDEOTAPE)
ASHER: Trace is a media company specializing in Afro urban culture. It has millions of young viewers tuning into its mixture of music and sports
shows, especially in Sub Saharan Africa.
Now, its founder wants to move the company into the world of education.
(BEGIN VIDEOTAPE)
CHATTERLEY (voice over): Olivier Laouchez is a man with a million plans. The chairman and CEO of Trace is hoping to leverage the popularity of his
many music channels to encourage people to engage with the learning process, as well as vocational training. The project is called Trace
Academia.
UNIDENTIFIED MALE: Trace Academia is a new generation online learning platform.
OLIVIER LAOUCHEZ, CEO, CHAIRMAN, TRACE: So we say this applies what we know from our entertainment expertise to education, and let us use the
power of digital, or these interactive features that now exist thanks to digital. And it also tries to get the expertise of jobs where it is
expected of the job is with the companies.
So we decided to mix these two different events -- entertainment, digital industry expertise to build a new platform, what we call an entertainment
platform that will bring massive innovation to the vocational training activity in Africa and the rest of the world.
UNIDENTIFIED MALE: I want the voices of U.K. urban culture.
CHATTERLEY (voice over): While being fun and cool is central to the Trace brand, education is something it's also taking very seriously.
UNIDENTIFIED MALE: We are Trace.
CHATTERLEY (voice over): Paris based space digital agency, Wizzmedia has been tasked with creating its online learning platform.
UNIDENTIFIED MALE: This is the desktop version and of course --
THOMAS BAUDIN, TRACE ACADEMIA: In the end, success is going to be measured as a number of success stories, and a success story for us is going to be
you know, I am a learner. I learned on Trace Academia and I got a job in the end.
CHATTERLEY (voice over): Born in Martinique with a home in South Africa and his head office in France, Laouchez is a truly global citizen. He wants
to make sure that everyone is offered an opportunity to succeed.
LAOUCHEZ: If we can build this platform and we keep a game changer for the lives of people, positive game changer, then I will considered that I have
accomplished that kind of dream.
(END VIDEOTAPE)
ASHER: And you're watching FIRST MOVE. We'll be right back after this short break.
(COMMERCIAL BREAK)
[09:51:46]
ASHER: Survivors of the Auschwitz Nazi concentration camp have returned to lay a wreath 75 years on from its liberation. You are watching live
pictures of a commemorative event that is happening right now.
In 1945, the Soviet Army threw open the camps gates and freed those who had survived. About one million Jews died at Auschwitz.
Fans around the world are mourning the loss of basketball legend Kobe Bryant after a tragic helicopter crash in Southern California. His 13-year-
old daughter, Gigi and seven other people also died in that crash as well and they were traveling to Gigi's basketball game scheduled for later on
Sunday.
Bryant also leaves behind a business empire as his legacy extends far beyond his time at the NBA. Alison Kosik joins us live now with details.
Alison, basketball was certainly Kobe Bryant's first love, but he was so much more. He had a budding music career at one point during his life. He
won an Oscar for Best Animated Short film. He was a businessman and an investor as well. So much more than an athlete. Walk us through it.
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Absolutely, Zain, you know, he transformed his skills and his work ethic that you saw on the court, but he
built a legacy off the court. He really became an entrepreneur. In fact, he was known in the business world as a brand builder and investor, a coach to
other athletes and company founders.
In 2013, actually, even before he left the NBA, he got into the investing world. He co-founded venture capital firm Bryant-Stibel with web.com
founder, Jeff Stibel.
Well, now that firm has $2 billion in assets with investments in dozens of technology, media and data companies, but also invest in Fortnite creator,
Epic Games and household product company, Honest Company.
And separate from the firm, Bryant made millions on his investment in sports drink, Body Armour, which in 2018 boosted its valuation by selling a
stake to Coca-Cola.
And then there are the endorsements because his stamp of approval really equals sales and you name it: McDonald's, Sprite, Nintendo, Turkish
Airlines, and Nike. Nike came early in his career. First signing with Nike in 2003, Bryant along with other big notable NBA players really helped
solidify the shoe company in a position in the basketball world and Nike actually had multiple lines of Kobe shoes and gear.
Nike even brought Bryant on stage with then CEO, Mark Parker at its annual investment meeting in 2017 to celebrate the launch of Nike's new business
strategy, and as you can imagine, Nike, as the rest of us are devastated.
Nike releasing this statement saying, "We are devastated by today's tragic news. We extend our deepest sympathies to those closest to Kobe, especially
his family and friends. He was one of the greatest athletes of his generation, and has had an immeasurable impact on the world of sport and
the community of basketball. He was a beloved member of the Nike family. We will miss him greatly. Mamba forever."
And it was Nike who partnered with Bryant to launch a Youth Basketball League in Los Angeles called the Mamba League in 2017, that actually gave
hundreds of kids free access to the sport.
[09:55:05]
KOSIK: And then Bryant went ahead and broadened it out and created the Mamba Sports Academy. So he sort of broadened it to other sports, making
them accessible to kids.
And as you said, he was on his way to one of those games with his daughter and seven others when that helicopter crashed yesterday in Calabasas,
California -- Zain.
CHATTERLEY: Yes, Alison, our hearts are incredibly heavy. Thank you so much.
And before we go, I just want to give you a quick check of the markets. Let's see how the Dow is doing right now. The Dow is actually down about
300 or so points because of fears regarding the coronavirus.
You have to remember that China is the largest importer of crude oil, and therefore oil is being affected as a lot of American companies that have
deep exposure to China including any kind of travel stocks, airline stocks, consumer good stocks -- all of those are feeling the heat right now as you
can see there, Brent crude is down about two percent.
All right, that's it. I'm Zain Asher. "CONNECT THE WORLD" starts right after this short break.
(COMMERCIAL BREAK)
[10:00:00]
END
