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First Move with Julia Chatterley
Yellen Promising More Money, but Warns of Tax Rises, too; A Ship Runs Aground Blocking the Suez Canal; The Duke of Sussex Moves to Silicon Valley. Aired 9-10a ET
Aired March 24, 2021 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:25]
JULIA CHATTERLEY, CNN BUSINESS ANCHOR, FIRST MOVE: Live from New York, I'm Julia Chatterley. This is FIRST MOVE and here is your need to know.
Spending splurge. Yellen promising more money, but warns of tax rises, too.
Maritime mayhem. A ship runs aground blocking the Suez Canal.
And hiring Harry. We speak to the Duke of Sussex's new boss.
It's Wednesday, let's make a move.
A warm welcome once again to all our First Movers around the globe, lots to get to this Wednesday, including the global reflation rethink, potential
Reddit regret. GameStop results disappointing and a royal role shift, Prince Harry heads to Silicon Valley.
We will speak to the CEO of the firm that's hired him, Mental Health app, BetterUp.
In the meantime, U.S. investors seem to be in a better headspace after Tuesday's losses. Tech, as you can see, they're outperforming as bond
yields continue to retreat. European reopening stocks meanwhile, continue to struggle as vaccine delays and lockdowns weigh on sentiment there. Even
Asia in fact, had a tough session, with the Hang Seng falling into correction territory down some two percent in the session today.
Chinese stocks now lower by over three percent year-to-date, not helped, of course by concerns about regulation of Big Tech names like Tencent, their
latest earnings, and all the details coming up, not helping sentiment either.
Meanwhile, as we talked about yesterday, AstraZeneca's latest quote "unforced error," so-called by Dr. Fauci, of course, we await updated U.S.
trial data that's expected in the next 24 to 36 hours.
Either way, Fed Chair Jerome Powell's perennial patience continued yesterday, both he and the Treasury Secretary, Janet Yellen acknowledging
the faster than expected U.S. recovery. They dismissed inflation and financial stability risks while pushing for more support for those hit
hardest.
Well, how about an additional $3 trillion worth of infrastructure spending and social support? And as mentioned, the tax rises to pay for it. We can
certainly expect more questions for Powell and stimulating policy palette, Janet Yellen, in Congress today to discuss it all.
Christine Romans joins us now. Christine, we can talk about the fact that they reiterated all the things that they've been saying and the policy
meetings, of course, for Jay Powell. But tell us more about the potential contents of this $3 trillion additional spending proposal.
CHRISTINE ROMANS, CNN BUSINESS CHIEF BUSINESS CORRESPONDENT: We know that the President's aides are working hard on this, they're going to present it
to him in coming days, maybe as early as next week.
But I don't think it's a mystery, what he said on the campaign trail and what he has promised again, and again, since he became President here.
He'd like a big infrastructure push. We know that. That's roads, that's bridges, and that's rail. That's maybe 5G, I don't know if that's on the
table here. That schools, that's also retraining for so many workers and a focus on domestic manufacturing. That's in the first part of this.
Maybe that's a little bit easier to try to sell to moderate Democrats and folks on the other side of the aisle, but it remains to be seen.
The second part is this caring economy, this fairness issue, making that child tax credit that's in the most recent stimulus, making that permanent,
maybe a minimum wage, free Community College. These are things that have been a wish list of his and progressives for some time, maybe that's part
two of this overall package here.
Pre-K -- universal pre-K and the like as well. But it's $3 trillion. And the President has said you're going to have to pay for this sometime.
Rather, he had promised, of course, right, taxes on people who make $40,000.00 and more, corporate taxes going back up from that very low 21
percent after the 2017 Tax Reform and Janet Yellen was asked about this, how to pay for all this yesterday. Listen.
(BEGIN VIDEO CLIP)
JANET YELLEN, U.S. TREASURY SECRETARY: It is necessary to pay for them. This will be spending over a 10-year horizon and would require some
additional funding.
He's been clear about the tax proposals that he would consider. One of those would be an increase in the corporate income tax rate back to 28
percent.
(END VIDEO CLIP)
ROMANS: Now what a lot of folks are talking about in the corporate world, is that just the starting point? Is this a negotiation here? Remember the
U.S. corporate tax rate was 35 percent. Companies had begged for something more like 25 percent.
President Trump and Congress passed 21 percent. Is there wiggle room back to say 25 percent that makes everybody happy and raises more revenue?
We don't even have the proposal yet. But those are the sorts of things that people are trying to game out -- Julia.
[09:05:17]
CHATTERLEY: Yes. And we were already talking about tax rises to pay for the near $2 trillion that was just agreed, never mind, tax rises to pay for
an additional $3 trillion. I think you said it, all the critics out there have wanted this kind of policy growth producing fiscal policy rather than
perhaps just seemingly throwing money at the system, however, important it is and unrequired.
You also said a wish list for progressives. And I think that was precisely done.
ROMANS: Yes.
CHATTERLEY: The risk here is that it remains a wish list for progressives and everyone else perhaps can want on.
ROMANS: Is this one big package as well? Or is this pieces of legislation that you can negotiate going on here? You know, we're only halfway through
the first hundred days of this President's tenure. He already has landmark legislation under his belt.
I do think that there is broad agreement that infrastructure can be a good idea with interest rates so low. Congress has never had the winds all
aligned here to get it done for some time.
You and I haven't talked about infrastructure for a long time. This should be easy. Can it be easy? Congress hasn't done it. You know, it hasn't done
it. But there could be a lot of wins in infrastructure. Republicans, Democrats, big cities, small towns, and it's an investment the future.
CHATTERLEY: Yes, and it doesn't have to be, to your point, a $3 trillion price tag. You can break this down and get the pieces -- some pieces done,
which should be the main aim.
Christine Romans, thank you so much.
ROMANS: Nice to see you.
CHATTERLEY: All right, one of the world's busiest waterways at a standstill. A huge container ship run aground in Egypt's Suez Canal
blocking traffic on this crucial trade route.
John Defterios joins us now. John, nothing I think illustrates the importance of this trade route more than how quickly it backs up with other
vessels when a container that's longer I believe, than the Eiffel Tower, runs aground. Talk us through this.
JOHN DEFTERIOS, CNN BUSINESS EMERGING MARKETS EDITOR: Yes, it's quite a challenge, Julia, because the Suez Canal handles about 50 vessels a day,
and handles about 12 percent of world trade.
But think of this as almost as a motorway pile up, but happening on the sea, and the Suez Canal, of course, connects the Mediterranean to the Red
Sea, and then out to the Indian Ocean.
Now, we've got some news, breaking in the last couple of hours on this according to the Suez Canal authority, suggesting that there's been
movement in the vessel. There were nine tugs trying to get it from being horizontal to parallel with the Suez Canal. It entered at the southern tip
of the canal at a narrow point here and that's why there's a struggle.
The reports of very strong winds and then a blackout, which made it difficult for the Ever Given, which has been leased there by Evergreen
Marine right now to get itself right back onto the traffic passageway. So it didn't happen.
It's interesting now, what happens next here in terms of global container traffic. This is a huge vessel, a VLCC, a very large container carrier that
can handle 20,000 units.
And if you look at the video pictures of the still pictures that are out there, it looked fully laden.
So the challenge was, can you move it? Yes, it seems to be the answer. The other option was to try to dig it out, and if that didn't work, you're
going to have to try to unload the cargo to refloat the boat, but we have some movement here.
But the clarity we're looking for, when can the other vessels, some 50 to 60 that are backed up, start to sail again -- Julia.
CHATTERLEY: Yes, watch this space. John, what about the implications for the oil market? Clearly, it's an important route for all flows into Europe
as well. And we've seen an about turn in oil prices that were lower this week and now pushed higher seems by in response to this.
DEFTERIOS: Yes, it's amazing what a traffic jam can cause to the oil market, Right, Julia? We had almost a $7.00 correction in the last week,
and if you look at the latest prices here, we're trading above $62.00 on Brent with this again, a better than what -- two percent. So that's quite a
turnaround.
Normally, the Suez Canal handles about five million barrels a day. That's not a major disruption to the market, which takes it now in terms of demand
about 92 million barrels a day.
But if it gets backed up like it has been for better than 30 hours, it does prove to be challenging.
We're looking at from two different sources here for tanker traffic container followers, that it's about 15 million barrels, right? So it's not
huge, about 15 percent of the daily demand that's out there in the market. That's the high end, roughly around 13 million barrels a day.
If it starts to sail again, not a huge issue with Saudi, Omani, U.S. and Russian crude. That's been sailing both going northbound and southbound
into the global market. Quite a shock though. All transpiring overnight in its worst case scenario, and now some clarity coming to the market.
CHATTERLEY: Yes, quite a shock. We'll see if they can shift that container sooner rather than later.
John Defterios, thank you so much for that.
DEFTERIOS: Yes.
[09:10:06]
CHATTERLEY: On to our next driver. GameStop reporting its first earnings since January's frenzied Reddit driven rally, the numbers fell short of
Wall Street expectations, but the stock is still up 950 percent this year. One can only imagine what the company had to say about that.
Clare Sebastian has been tracking all the details. I can see disappointment, but I can also see a bright spot here, which is the e-
commerce sales, which were significantly higher. Clare, talk us through the details of this one?
CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes, Julia, that is definitely the key number here. E-commerce sales are up 175 percent in the
quarter. They now represent 34 percent of all sales versus 12 percent in the same period last year.
So clearly, the company has been aggressively, you know, building out its e-commerce capabilities. We see that with some management changes, but
look, the stock is down significantly premarket, it's about 11 percent the last I checked, and that is for a number of reasons.
One, because on the top and bottom line, this earnings report did disappoint. I think investors were hoping for more and they were certainly
hoping for more detail. The call itself while very much oversubscribed perhaps because of the Reddit gang, well, it was a bit short on detail and
a bit short in length. It was only 20 minutes. There was no Q&A.
People were expecting a bit more on the company's transformation. What we got was some broad brushstrokes on, you know, building out the kinds of
products they're offering, more on fulfillment, e-commerce, all of that. So that's another reason why the stock I think is down today.
But also because one question that a lot of people were asking ahead of this, given the meteoric rise in the stock price, is the company going to
issue new shares to try and capitalize on that very deep in the regulatory filing? They did say they were evaluating that option.
Obviously, that would dilute existing shareholders that may be one of the reasons we're seeing the stock down again today, but I did look at some of
the Reddit chatter. They are saying, some of them, GameStop is on sale. When can I buy?
CHATTERLEY: Yes, they are not daunted at all. I mean, extraordinary, 20- minute press, and no Q&A. That says a great deal to me.
You know, renowned short seller, Jim Chanos on Twitter, I was just looking through what his comments were, and he said, most of the company's fourth
quarter earnings per share were from tax credits and software sales were down 26 percent in the fourth quarter, and they make a lot less on a
relative basis from hardware sales.
So, yes, he's not a fan. But as to your point, it clearly is made, the Reddit guys and not deterred here.
Also interesting story in the mix here, very much tied to what we saw from Robinhood and the criticism amid the volatility of some of these stocks
that Robinhood took action and should have taken action sooner and took the wrong action.
They also remain undaunted filing for an IPO.
SEBASTIAN: Confidentially though, Julia, this is something that's increasingly popular among companies filing for IPOs.
This means that they don't have to release their sort of major regulatory filings showing all of their internal financials until about three weeks
before their listing, but it does show the fact that Robinhood is willing to go to market.
It does say that they are confident in their future growth, even despite that major PR hiccup that we saw in January. And I think, you know, we see
that, the market, this is still a boom time for the markets, interest rates are at record lows, retail trading is still hugely popular and Robinhood
clearly very keen to capitalize on that.
But another thing I think that the January episode made very clear is that this is a business that desperately needs cash and funding for an IPO, of
course, one way to get that.
CHATTERLEY: Yes, that's such a great point, Clare, actually. I mean, it also fulfills the mantra that there is no such thing as bad PR, but your
point about the cash vitally important, I think.
Clare Sebastian, great to have you with us. Thank you.
All right now, to the latest on the COVID-19 vaccine rollout around the globe. Hong Kong and Macau suspending the use of the vaccine from BioNTech
and its Chinese partner, Fosun Pharma saying the problem is defective packaging.
Kristie Lu Stout because he listed out has been investigating.
KRISTIE LU STOUT, CNN CORRESPONDENT: A big hurdle in Hong Kong's vaccine rollout due to concerns over product packaging.
Hong Kong health authorities have suspended the use of two batches of the European made BioNTech vaccine distributed by Fosun Pharma.
In its statement, the Hong Kong government said this, quote: "For the sake of prudence, the concerned vaccination should be suspended immediately for
the time being while investigation is ongoing. So far, BioNTech and Fosun Pharma have no reason to believe that there was a risk to product safety."
Unquote.
Now, for those like myself who have taken the first dose of the BioNTech vaccine, there is this from the Hong Kong Director of Health.
(BEGIN VIDEO CLIP)
DR. CONSTANCE CHAN HON YEE, HONG KONG DIRECTOR OF HEALTH: We would recommend to those who have received the first dose to wait for our further
announcement, because we do not recommend people to receive a second dose of a different brand.
So please wait for announcement by the government.
(END VIDEO CLIP)
LU STOUT: The vaccine rollout here in Hong Kong has been slow. As of Tuesday, only 5.4 percent of the total population has been inoculated.
Health experts say 70 percent need to be inoculated to achieve herd immunity, and it may take some 300 additional days for Hong Kong to reach
that goal.
Kristie Lu Stout, CNN, Hong Kong
[09:15:08]
CHATTERLEY: Okay, let me bring you up to speed now with some of the stories making headlines around the world.
In the U.S. State of Colorado, the suspected in Monday's supermarket mass shooting will make his first court appearance tomorrow.
Police identified 21-year-old Ahmad Al Aliwi Alissa as the suspect but don't have any concrete motive for the attack that killed 10 people.
Most of the votes are counted in Israel's fourth general election in two years, but the picture remains muddled. Prime Minister Benjamin Netanyahu's
party and its coalition allies currently below the threshold for a majority though that could still change as counting continues. Hadas Gold is in
Jerusalem to break it down for us.
Hadas, how many more votes are left to count and are we looking ahead to election numeral five?
HADAS GOLD, CNN CORRESPONDENT: Julia, well, we have about 90 percent of the votes counted right now. We're expecting an update really any minute
now on the last bit of votes.
There is a slight delay in counting the votes here because of the coronavirus pandemic, there's these special absentee ballots. We're
expecting about a few hundred thousand of those absentee ballots are potentially delaying some of the vote counting.
But so far, 90 percent of the votes in and we really don't have a clear answer on what the next Israeli government will be, because although Prime
Minister Benjamin Netanyahu's Likud Party is expected to be the largest party in Parliament, as you noted, his right-wing bloc does not seem to
have a clear majority. There's 61 seats. They need to have a majority for him to be able to stay in power.
It doesn't seem as though he nor actually this kind of ragtag group of opposition parties either have the majority. So we're really at a stalemate
here and it's not clear which way it's going to go.
Now, as we noted, there are still votes to be counted. And in this sort of race, one or two seats could swing the pendulum. That could be the entire
difference.
We may also see a situation where a smaller party could be a kingmaker, a smaller party with maybe only four seats or so could turn and decide which
party they're going to sit with.
But it's hard to really imagine the scenario where we have parties on complete opposite ends of the ideological spectrum, agreeing to sit
together in a government.
So what does that mean for the future of Israelis whether they're going to be going back to the polls? Potentially, there is a chance that we would
then have a fifth election for Israel in the next couple of months if nobody can get this coalition together.
Prime Minister Benjamin Netanyahu's political future and his legal future is really on the line here, because for Netanyahu, it's important to get a
majority in Parliament, because he might want to get a law passed that would protect him from prosecution.
He is on trial right now for corruption and bribery charges. If he doesn't get that majority, he might not get that law. And if there was a majority
from the opposition, they could potentially pass a law that would prevent him from getting immunity or prevent him from even serving as Prime
Minister if he is indicted.
So as it stands right now, things are murky. We've already had Election Day. We have no idea though, what a future Israeli government look like.
Again, this could change in the next few minutes as we get those results in. But as of right now, stalemate in Israeli politics -- Julia.
CHATTERLEY: Once again, Hadas, great job. We will learn -- we will continue to watch that closely for when we get that final vote count
through. Hadas Gold, thank you so much for that.
All right, for the first time, Brazil has recorded more than 3,000 coronavirus deaths in a single day. The country is nearing 300,000 deaths
overall.
President Jair Bolsonaro appeared on television Tuesday, offering sympathy to the families of victims and saying this is the year of vaccination for
Brazilians.
Still to come on FIRST MOVE, China's tech giant, Tencent under renewed regulatory scrutiny as it reports a staggering profit surge.
And the travel industry tells President Biden to reopen borders to international travelers or risk the economic recovery and jobs.
Still coming up, stay with us.
(COMMERCIAL BREAK)
[09:21:49]
CHATTERLEY: Welcome back to FIRST MOVE live from New York where the U.S. majors looks set to claw back some of Tuesday's losses as bond yields
behave for a fourth straight session, i.e. that means bond yields down. Reflation players like banks, energy and industrials are all ticking higher
premarket along with rate sensitive tech stocks, too.
You can see the NASDAQ higher by some five tenths of one percent. Chipmaker, Intel, a big gainer after announcing an aggressive turnaround
plan that blends continued chip manufacturing outsourcing with a $20 billion commitment to new in-house manufacturing, a positive development
given the recent focus on global chip shortages.
The news, pressuring shares of contract manufacturing giant Taiwan Semiconductor on fears that it could see weakened future business, stiffer
competition, although Taiwan's Economy Minister is playing down the potential impact.
Meanwhile, China's gaming and social media giant, Tencent has reported smashing earnings with quarterly profits soaring 175 percent to just over
$9 billion. It comes at a pretty delicate time for Tencent, which has reported the founder and CEO and China's second richest man Pony Ma met
with Chinese regulators earlier this month.
Selina Wang joins me now. Nothing captures the interests of investors and regulators like earnings like this. Just walk us through the numbers here
because they had a pretty phenomenal quarter.
SELINA WANG, CNN CORRESPONDENT: Phenomenal indeed, if you look at the numbers, it is green across the screen. You mentioned that massive profit
jump. Revenue also up more than expected, up 26 percent, its Fintech and online gaming arms up about 29 percent.
This is China's most valuable company. It's known for its ubiquitous chatting app, social networking app, WeChat, as well as its online
payments, WeChat Pay; also for its popular mobile games. It also has investments in hundreds of startups.
Earnings here certainly incredibly strong, but it is largely being overshadowed by this regulatory concern which could significantly hamper
Tencent's growth.
Now according to Reuters, the Tencent CEO, Pony Ma had requested a meeting with Chinese regulators. Reportedly, these regulators are looking into
potential anti-monopolistic practices on the part of Tencent potentially quashing other competitors. It's also been reported that regulators may be
considering requiring Tencent to overhaul the Fintech arm of its business, potentially putting it into a holding company that would be treated more
like a bank.
This is possibly what's going to happen to Alibaba's Fintech arm, Ant Group.
If that does happen, this would significantly hamper Tencent's growth. Now, the company did confirm that this meeting did in fact happen, but they
dismissed the importance of it saying it was a regular meeting and a broad range of topics were discussed -- Julia.
CHATTERLEY: You know, it's funny, as I was reading through this, I lost count of the number of mentions of things like social responsibility,
healthy operations, compliant and inclusive Fintech products, prioritizing risk management or safety over scale.
They were trying really, really hard in this release to promote the softer side of what is the country's largest business, and to your point, a
monster operation, monster users, sheer power, I think, the strength of one of China's biggest tech companies.
[09:25:11]
CHATTERLEY: Selina, did they directly address the risk of interference from the Chinese authorities because that's what the risk is.
WANG: Absolutely. I mean, again, the company tried to dismiss the importance of this meeting, but investors have been waiting for quite some
time for Tencent to be the next one to be targeted.
As you say, these companies are indispensable to nearly every aspect of daily life in China. And quite frankly, Beijing is getting frustrated and
losing patience with the outsized power that these technology companies have.
We saw this unprecedented crackdown on Chinese tech giants late last year starting with targeting Jack Ma's empire, Ant Group and Alibaba.
Of course, we've been discussing extensively on the show about why and how Ant Group's IPO had to get shelved. Now, you're seeing a forced re-haul of
its business. But what's interesting now, Julia, is that China is actually even further widening this tech crackdown, signaling that they are even
going to ramp this up further.
Xi Jinping recently said that they are warning more regulatory scrutiny on what they're calling quote, "platform companies." This is an extremely
broad description. It could include other e-commerce companies like Pinduoduo, JD, it could include delivery giant, Meituan, or ride hailing
giant DiDi. So there's probably going to be much more to come.
And when it comes to these tech companies and why China is so concerned, it is no surprise that you are seeing Tencent put in the list of all of their
safety and data privacy concerns, because what regulators say they're worried about is the misuse of consumer data, consumer privacy, as well as
how they could be hurting competition.
This is something that echoes what regulators are dealing with around the world in the U.S., Australia, E.U., but in China, there is also the sense
that the government is sending a message that no one person, no one company is more important than the Chinese Communist Party.
CHATTERLEY: I was about to say, and unlike in every other nation in China, authorities rule and the lobbyists are nowhere.
Selina Wang, great job. Thank you so much for that.
All right, the market open is his next. Stay with us.
(COMMERCIAL BREAK)
[09:30:20]
CHATTERLEY: Welcome back to FIRST MOVE. U.S. stock markets are trading and we are higher. Tech taking a leadership position after Tuesday's more than
one percent pullback and that is the picture, I think though it looks like we're down there some one percent there, so we'll wait for NASDAQ -- the
NASDAQ to open up. I think we're a little early there.
Yes. Okay. And there we go, higher by half a percent. Forgive us for that, we just needed to warm up a little bit there on the stock markets.
New economic numbers released today play into Fed Chair, Jay Powell's argument that the U.S. economy still has a long way to go before it
completely heals.
U.S. durable goods orders falling 1.1 percent last month as businesses pulled back on equipment spending, other chips playing into that, as we see
car makers slowing their production as well. That's something to watch going forward.
In the meantime, Bitcoin on the rise. Tesla Chief, Elon Musk announcing that U.S. consumers can now pay for new Tesla cars with the digital asset.
He says Bitcoins paid to Tesla will not be converted into fiat currency like dollars, they'll just add it, of course, to the cash on the balance
sheet, the Bitcoin cash on the balance sheet.
People outside the United States should be able to place their Tesla order with Bitcoin later this year.
All right, the travel industry now calling on President Biden to reopen the United States to international visitors. In a letter to the White House, it
warns that the economic recovery is at stake, opening borders by July 4th would mean $30 billion in additional spending and the return of 225,000
American jobs in their estimates.
Joining us now Chip Rogers, President and CEO of the American Hotel and Lodging Association. Chip, great to have you with us. Talk us through the
conditions that you're asking for.
CHIP ROGERS, PRESIDENT AND CEO, AMERICAN HOTEL AND LODGING ASSOCIATION: Well, we would like to see a return to normalcy. Of course, everybody does.
It's interesting the numbers that you just cited, that is based on only 40 percent of the 2019 activity levels.
So think about it this way, if we only got back to 40 percent of 2019, you're adding about a quarter million jobs back into the economy, and
again, tens of billions of dollars of economic activity.
So just a little return to normalcy will go a long way towards helping some.
CHATTERLEY: What are you hearing back from the administration?
ROGERS: Well, nothing yet, but that's not surprising. We just recently sent a letter and I know that right now, the focus of the administration is
of course stopping the virus here in the United States.
But if you think about travelers, and how they travel, they're always planning well ahead. We're already seeing this for the summer travel. You
can look at what's happening in Florida where summer travel is off the charts. And compare it to California, who has different policies in dealing
with the virus and the summer travel bookings aren't nearly as close.
So travelers will plan, and if we create a roadmap saying this is when we believe the economy will open, this is when international travel can
continue if we hit these specific marks, people will start planning for that.
CHATTERLEY: Key too, to this is the C.D.C. guidelines, and right now, even for U.S. citizens, they're still being incredibly restrictive over people
that have been vaccinated, never mind those that haven't.
So to your exact point, the United States is getting cracking with its vaccinations. Europe is one example, is really struggling. It's tough to
see the authorities being willing to see international travelers from areas like that when so few have been vaccinated, and the virus is still pretty
virulent.
ROGERS: Well, we can begin bilateral talks, I mean, take a nation like Israel, for example, it is leading the world in vaccinations. There's no
reason why we can't begin having international travel and be done in a very safe way between the U.S. and Israel. The same thing for the U.K. that is
doing a lot better than the rest of Europe.
And so there are countries that are doing well, we can start that process. And by starting that process, we show how safely it can be done.
CHATTERLEY: Yes, we need a protocol set up for individual nations that are in some way on the same level, which is actually how it was handled in the
beginning with virus cases and trying to manage travel.
ROGERS: It was and it was even handled that way here domestically in the U.S., and so, we kind of have a roadmap of how this could and should work.
I guess our frustration all along whether it be the C.D.C. or any particular administration is the lack of following the economic science.
We hear a lot of talk about follow the science. Well, there's health science, there's economic science, all of that needs to be part of the
plan.
CHATTERLEY: What about for people visiting the United States and the progress with vaccinating those that work in your specific example, in the
hotel and the lodging industry? How are you doing in terms of the percentage of people that have been vaccinated to meet potential tourists
and travelers?
[09:35:02]
ROGERS: Well, I think we're doing quite well. What's interesting is the rapid pace that the rules are changing and in a good way. For example, in
the State of Georgia, just yesterday, the Governor announced anybody above the age of, I think 16, can now go ahead and get the vaccination. And so
we've seen this really transform itself just over the last few weeks.
Obviously, the people that work in our industry are usually a little younger than the average person in the United States, and so they may not
have qualified in some states, but we're seeing that change every single day. And in many states, take Hawaii, take Nevada, they've taken
hospitality workers and they put them at Level 1-B, where they can go ahead and get vaccinated. So it's happening rather quickly.
CHATTERLEY: What's going to be the cost, Chip, if we don't get further clarity?
ROGERS: Well, it has been devastating so far. I mean, people need to keep in mind that 2020 was the worst year in history for Hospitality and
Tourism, and specifically, the hotel industry. This year, even under the best case scenario, we're still going to be below breakeven, which means
more hotels will close, more jobs will be lost.
We've got to get back to something that looks like 2019, and I know everybody wants that, but we've got to do it a lot quicker than perhaps
many are expecting.
CHATTERLEY: How long to full recovery, Chip? What are you saying to your people? What are they saying to you?
ROGERS: You know, it goes market by market. Obviously, if you're in a beach town right now, maybe you are recovered. But if you're in an inner
city urban market that depends on meetings, conferences, and conventions, in many cases, you're still closed.
But the experts tell us that if everything goes according to plan, by the end of 2023, we'll be back to those 2019 revenue numbers.
And I don't want people to be fooled by occupancy numbers jumping up in the summer. Remember, even last summer, occupancy numbers jumped up. At the end
of the day, hotels have to pay their bills with revenue.
So rates are considerably low right now even if occupancy jumps, with the low rates, you still may not be breaking even. So we've got to get back to
those revenue numbers, which again, we think we'll see by the end of 2023.
CHATTERLEY: We shall see. Chip, great to have you with us. Thank you so much for that and fingers crossed you get some clarity from the government.
I think everyone wants it, too.
ROGERS: Thank you.
CHATTERLEY: Chip Rogers, President and CEO of the American Hotel and Lodging Association. Thank you.
All right, coming up after the break, Prince Harry is stepping up. He has joined BetterUp, providing coaching and mental health services, the CEO is
next, as we look at a Royal resume.
(COMMERCIAL BREAK)
[09:40:31]
CHATTERLEY: Welcome back to FIRST MOVE. Prince Harry has started a new job as a tech exec. The Duke of Sussex is taking the title of Chief Impact
Officer at a company called BetterUp. It's a Silicon Valley startup providing online coaching and mental health services.
Prince Harry is featured on its website as part of the leadership team. In a blog, he says he benefited from the company's coaching saying, "What I've
learned in my own life is the power of transforming pain into purpose."
He and his wife, Meghan recently talked about the strain of Royal life on their mental health in an interview with Oprah Winfrey.
And joining us now Alexi Robichaux is the co-founder and CEO of BetterUp, and just in full disclosure, our parent company, WarnerMedia is a BetterUp
client.
Alexi, great to have you with us. Just explain the mission, please. I read it's the: "To provide a gym for mental health." What does that mean in
practice?
ALEXI ROBICHAUX, CO-FOUNDER AND CEO, BETTERUP: Sure. Thanks so much for having me. The easiest way to think about BetterUp is we're taking what's
traditionally been thought of as executive coaching and combining science and technology and human wisdom, provide a way to put that into the pockets
of workers and professionals worldwide.
So we are a professional mobile platform that connects individuals with one-on-one dedicated coaching that they can do related to leadership,
sleep, nutrition, parenting, and they get to do this over video chat and text message or from the convenience of their phone.
CHATTERLEY: You say IA -- AI -- getting my letters mixed up -- AI enabled. What does that mean in practice? Clearly, I need some coaching on speaking.
ROBICHAUX: Sure. We do have public speaking coaching, but I don't think you need it.
CHATTERLEY: Oh, fabulous. Where do I sign?
ROBICHAUX: Yes, so, apparently you have access already. So good for good for you all. Yes, so you can think of similar to eHarmony. We use machine
learning and artificial intelligence to help find the coach that's the right match for you.
So we look across 120 different variables from the data you give us through a quick questionnaire, and we're able to match coaches with you based on
everything from communication preferences, the focus areas where you want to grow, to make sure that you're getting a really tight fit with your
coach. And it feels natural, it feels comfortable, it feels energizing, and it feels safe.
CHATTERLEY: So explain Prince Harry's role. What is a Chief Impact Officer?
ROBICHAUX: Sure, yes, we came to the title together because he and I had met and we were organically having these conversations about how the
mission of BetterUp is actually bigger than BetterUp.
You know, we founded the company and he's been doing this work in his own life for years about how do we change this global dialogue around mental
health, to not think of mental health as just the absence of mental illness, but to really think about mental health as performance and
realizing your potential and flourishing as we would say. And that is a huge global impact that BetterUp can be a part of.
And so as we were thinking about what he could do, his duties and responsibilities where he was excited to contribute, we really were
circling around on the one hand, how can you continue to keep us accountable as a company to our social impact and our mission, and also
accelerate that by expanding our global community, our global reach, helping to influence everything from our product experience to co-creating
content in the product experience itself, and then helping to partner with companies and organizations globally to expand our impact around the world.
CHATTERLEY: So, it's more of a leadership role or me, as a client, could I call up and say, hey, I really think I would benefit from Prince Harry's
advice. Can I set up a one-to-one advice session with him? Is that possible?
ROBICHAUX: That is unfortunately not possible. I think that would actually limit his scale and impact, although, it would be really deep impact for
you. I've learned so much from him.
What we've done is we put him in a leadership position so he can scale that impact globally. And so he will be making decisions and contributing one
level up in terms of what are the types of contents we use and helping to create content that millions of people can use as well, and then helping in
everything from product decisions to corporate strategies, so that we're positioning the company to get it into the hands of more folks like you
worldwide.
CHATTERLEY: And what is it about his CV that when you met him, I'm sure he's a high impact person anyway, but what was it about his experience in
his CV that makes you believe he's the right person for this role?
ROBICHAUX: I think two things. You know, I think first and foremost, it's really who he is as a person and obviously I had never met someone who is
Royalty before meeting him. And I was just so impressed with his genuine and sincere desire to be of service and to make a positive impact in the
world.
[09:45:09]
ROBICHAUX: And so for us here at BetterUp, the most important thing is always someone's passion and energy around our mission and he has that in
just abundance.
The second is, he has done the work, right? I think, you know, we all grew up watching him grow up and it is incredible to see his own growth and
development even as he shared in our blog, his own growth and transformation. And his work related to everything from Heads Together to
HeadFIT to the Invictus Games, he just really has an incredible track record and experience related to advancing and pioneering and pushing
forward this mission related to mental fitness for preventative mental health.
And so, you know, even long before we had the opportunity of meeting him, I had always, you know, had a daydream that maybe we would be, you know,
privileged and lucky enough and fortunate enough, one day to work with someone like him, who has been one of the leading voices in the world for
mental health.
And so we're really honored and delighted. We truly could not have thought of someone better for this role, and we're really thrilled to work with him
on it.
CHATTERLEY: Nor somebody more Royal. I mean, the critics are going to look at this and say, it's a whopping great PR stunt. All his attributes aside,
it's a whopping great PR stunt. And in light of the Oprah Winfrey interview, which so many people watched, do you worry that he could perhaps
be a distraction, at the same time just on a PR -- if there is such a thing as a distraction in this game, but a distraction for the broader business?
ROBICHAUX: I think the main thing here is, you know, sure, we'll take the PR, that's really not why we started working with Prince Harry, right? I
think having had the opportunity to meet him and get to know him, I would say, you know, that is one of the least important factors, right?
His insights, his creative contributions, his unique experience here, it's really hard to put into words, but he has so much value to add to our
members and our users, like some of your colleagues, as well as the game changing work we can do worldwide in partnering with more organizations.
So that's where we're focused and that's what we really designed the role around is how do we maximize that impact? And how do we have more advocacy
and more voices internationally around the fact that we need to be open, and we need to be loud about what our needs are related to our own growth
and development and mental health.
And that's its own form of heroism and its own form of courage.
CHATTERLEY: Yes, and I would say to your point, Hilton, NASA, Chevron, Mars, Snap, we're all using you long before Prince Harry came on board just
to illustrate this point.
And Alexi, I just want to get your take on something as well, Goldman Sachs have had a really tough week with some of their analysts saying that
they're working 95 hours a week. They suffer workplace abuse.
I know one of the things you also work on is sort of positive behavior in the workplace, too. I don't know whether Goldman Sachs is a client or not.
But in that kind of example, how would BetterUp go in there and say, this is how we can help support your workers.
ROBICHAUX: I can't speak to the specifics of Goldman Sachs. I haven't been briefed on that. But I will say in general, what we know from three to four
decades of Management Science and Psychology Research, as well as our own personal experience, is what we have to do is break down this idea that
there's a difference between our work self and our home life, and that the minute we go to work, somehow we're activating different skills or a
different part of ourselves.
The reality is, there's this set of psychological resources and skills that underpin our flourishing our wellbeing both at work and at home, as well as
our performance.
And when we are mentally fit, when we have mental fitness, we not only perform better at work, we perform better in life.
And so part of our mission in BetterUp is to get more corporate CEOs, more folks in the C-suites and companies around the world to really redesign
work around the real data and the real science that says, you know what, if folks aren't flourishing, if they're not doing well, they're not going to
be performing well.
And this idea that I can extract work from them in the short term, and that will somehow still help my business perform is not only short sighted, it's
misguided.
And when you look at organizations that can consistently innovate, and win in a creative economy, they are organizations that help people over time,
find that sense of wellbeing and that flourishing.
And so what we're trying to do is change that dialogue, and that's one reason we're excited to work with Prince Harry to give more energy, and
more enthusiasm and more insight to that mission.
CHATTERLEY: Can I ask how much Prince Harry is going to get paid for this role?
ROBICHAUX: As you can imagine, as a private company, we don't disclose anyone's compensation. So we're not able to comment on that.
CHATTERLEY: But he is getting paid.
ROBICHAUX: He is. He is deeply invested in BetterUp, and yes, he's very committed to the cause and mission, but I can't tell --
CHATTERLEY: I can see he is looking forward to a potential IPO. Alexi, great to have you with us. Thank you so much, and good luck with your work.
ROBICHAUX: Thank you so much.
CHATTERLEY: Thank you. Alexi Robichaux there, the co-founder and CEO of BetterUp. Thank you.
You're watching FIRST MOVE. More to come.
(COMMERCIAL BREAK)
[09:52:32]
CHATTERLEY: A big boost for Africa's largest telecom company, South Africa's MTN Group saying it added nearly 13 million new subscribers last
year. Our Eleni Giokos sat down with the company CEO to discuss their future plans in today's "Connecting Africa."
(BEGIN VIDEOTAPE)
RALPH MUPITA, PRESIDENT AND CEO, MTN GROUP: We think the demand is surging, it is not abating. Last year alone, 110 percent increase in data
traffic. We're going to spend approximately $10 billion worth of capex over the next five years to ensure that Africa has the infrastructure to power
its growth.
ELENI GIOKOS, CNN BUSINESS AFRICA CORRESPONDENT: Do you see yourselves and the definition of what a telco is, a communications company starting to
evolve in the next few years, and what would that mean for you?
MUPITA: That's exactly what we've painted out in Ambition 2025 where we are basically saying that we're going to have the strongest connectivity
business across Africa. We have 85,000 kilometers of fiber across the African continent, you know, that kind of coverage is going to increase.
But on top of that connectivity are five platforms that will accelerate growth: financial services is going to be a big part of that, digital
services, gaming, music, video, and then we have what we call the Africa API marketplace where we bring small businesses together, expose them to
our platform and allow them to exchange data and through that exchange of data, ultimately monetize and create, you know, sustainable businesses.
GIOKOS: What's the most interesting call that you have received during the pandemic, where a business was caught off guard and suddenly needed to
think about the way that they should be digitizing? We should have done it a few years ago.
MUPITA: That's an interesting question. I think, you know, just the rapid change in e-commerce, I think, was surprising in many markets. And you see
these guys now on scooters all over the place, you know, delivering. We've seen in our markets that that pickup has actually been quite explosive.
So I think people underestimated just the latent demand for kind of e- commerce solutions, which are obviously all underpinned by connectivity.
GIOKOS: So when I talk about the Continental Free Trade area, and we say intra-Africa, trade needs to increase from the current 15 percent that
we're at right now, can it truly be done without a strong telco sector and without executives like you thinking big?
MUPITA: I would argue that it's not possible that we get to the, you know, the kind of growth that is anticipated under the agreement without the
telecommunication sector. There was a massive fiber build and data build required over the next three to five years across the African continent and
with unified regulations, they will be able to move from country X to Y, with your investment secure that, you know, this investment, you know, will
yield the return. So the Free Trade Agreement, I think is super important and the telecommunications sector can play a massive role there.
(END VIDEOTAPE)
CHATTERLEY: Okay, that's it for the show.
If you've missed any of our interviews today, they will be on my Twitter and Instagram pages in the next few hours. Search for @jchatterleyCNN, and
in the meantime, stay safe. We'll see you tomorrow and "Connect the World" is up next.
(COMMERCIAL BREAK)
[10:00:00]
END
