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First Move with Julia Chatterley
Crematoriums in India Overflow as the Government Admits "Responsibility is Ours;" E.U. Back in Recession in Q1 as Germany's Economy Stalls; Amazon Delivers a 200 Percent Plus Profit Rise. Aired 9-10a ET
Aired April 30, 2021 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:19]
JULIA CHATTERLEY, CNN BUSINESS ANCHOR, FIRST MOVE: Live from New York, I'm Julia Chatterley. This is FIRST MOVE and here is what you need to know.
India's anguish. Crematoriums overflow as the government admits "responsibility is ours," quote.
Double dip. The E.U. back in recession in Q1 as Germany's economy stalls.
And Amaze-on. The tech titan delivers a 200 percent plus profit rise.
It's Friday. Let's make a move.
A warm welcome as always to our First Movers around the globe. It is great to have you with us. We are wrapping up a week filled with promising news
on the recoveries and reopenings on the one hand, but with the specter of India's worsening humanitarian crisis on the other.
And it was another heartbreaking day there. Almost 400,000 new COVID cases reported. We will take you to India for the latest as more critical aid
supplies arrive. We'll also hear from the Oyo Hotel CEO as the business community, too, battles to offer their support.
For now though, it is the final trading day of April. U.S. futures are softer. The S&P 500 easing back from record highs hit on Thursday. That
despite gains as I mentioned from tech titan, Amazon, all the details on their monster earnings report coming up.
Europe in the meanwhile bucking that trend, helped, I think by strong results from the likes of Barclays, BNP Paribas and the financial sector
and offsetting news that the Eurozone ended a double dip recession in the first quarter.
But, remember, of course, that data is always back looking. More recent indications point to things like Germany improving and we know the French
economy could see COVID restrictions ease which will help next week.
Meanwhile in Asia, tech troubles trump all. The global semiconductor shortage limiting the Chinese factory activity, while in Hong Kong, Chinese
tech stocks fell after Beijing ordered 13 major firms to dial back on risk, unbundle services and address, quote, "unfair competition" in their Fintech
units.
There is lots to discuss this hour as always. But once again, we begin in India with new coronavirus cases again breaking records over the past 24
hours, a spokesman for Prime Minister Modi's party admitted there had been failings in the government's response.
(BEGIN VIDEO CLIP)
NARENDRA TANEJA, BJP SPOKESMAN: We are the government in India, so of course, the responsibility is first and foremost ours, good or bad,
whatever it is. And it is our responsibility and we are trying our very, very best, but this did come as a surprise.
Today, a lot of people are saying that you should have done that. You knew in February, but at that time scientists, doctors, they were all more or
less of the same view. Politicians -- we, politicians formed the opinion that we are getting -- we were more less getting out of COVID situation.
Our views are basically coming out of the, you know, kind of analysis, the kind of reports feedback we were getting from scientists and doctors,
including those living outside India -- but Indians who are living outside of India.
But evidently something went wrong.
(END VIDEO CLIP)
CHATTERLEY: Clarissa Ward joins us now. Clarissa, trying their best doesn't help the people that are suffering now. Just give us your
perspective. What do you make of what you're seeing?
CLARISSA WARD, CNN CHIEF INTERNATIONAL CORRESPONDENT: So, Julia, first of all let me start out by telling you where we are. We're here, behind me is
a (AUDIO GAP) for oxygen.
You can see it goes all the way down that block and if we (AUDIO GAP) other people actually (AUDIO GAP) last night, they're taking (AUDIO GAP) --
CHATTERLEY: Yes, as you can see there, we are struggling to keep contact stable with Clarissa.
We will try and get her back, but for now, we thank her. And as you can see, and will see, there's a report from Clarissa which is pretty
harrowing. I mean, you'll see that in the next hour on CNN.
Now, from the appalling human tragedy of the pandemic to the economic damage being wrought, too. The European Union entering a double dip
recession with growth shrinking by 0.4 percent in the first quarter.
Germany among the worst hit seeing growth fall by some 1.7 percent. Melissa Bell joins us from Paris for more, Melissa, I mentioned earlier on the
show, it is backward looking, this data, but you can't help but draw a comparison between what we saw across the European Union versus what we saw
in the United States and growth clearly in the United States.
Europe is still struggling with outbreaks.
[09:05:01]
MELISSA BELL, CNN CORRESPONDENT: That's right, Julia. You can only help -- you can't help but compare and contrast, but of course, the fortunes of the
E.U., not just the E.U., but the Eurozone, both seeing that official entry into recession as a result once again of this quarter's contraction, Julia.
The difference, I think, when you look at those two economies and how differently they've performed over the first quarter of 2021 really, the
two big differences are on one hand vaccines and on the other hand stimulus, Julia. Those are the real two keys to understanding how different
the United States and Europe have fared.
Now, it is probably no surprise, when you look around the E.U. at the moment, we're seeing economies that are locked down. There are a lot of
restrictions in place.
Here in Paris, restrictions have been lifted now for many months. Many things essentially at a standstill and that would explain a lot of that. On
one hand, you've had that sluggish vaccination campaign. Really, Europe's figures, nowhere near where the United States' figures are for the time
being, so the restrictions have had to stay in place while those third wave COVID-19 figures have continued to rise here on the European continent.
But then also, there is that question of stimulus. We will remember last year, when you and I talked about this, Julia, it had been such a step
forward for the European Union. The 750 billion euro stimulus package for the first time, Europeans were going to be able to raise debt together.
This was really a sign of new things to come for the E.U. and its ability for once to be able to function as a block to take on these kinds of
challenges. The trouble is, Julia that those payments that will be the fruit of that 750 billion euro stimulus package really won't start coming
until the summer.
So, you've seen the United States both have a faster vaccination campaign, a faster stimulus program that has got money back into coffers when it
needed it in time. That really the big differences between the two.
And I think, both of those, both the vaccination and the stimulus, the fact that Europe for the first time is trying to take on this pandemic in a
coordinated united way, that, Julia, takes more time than doing it alone.
CHATTERLEY: Yes. When you've got a sign off on some kind of stimulus and a response by 27 different Parliaments or governments across the E.U., then
you're going to have serious trouble, you want to do it quickly and that really has played into these numbers here, to your point about the
response.
Melissa, what about what we're going to see in France next week? There's a hope that perhaps we see some of the restrictions reduced.
BELL: That's right. Finally, we feel like we're turning a corner on this side of the Atlantic, at least, Julia. You were quite right to point out a
moment ago, of course, all of these figures are backward looking. We're looking to the terrible second and third waves that have really battered
Europe hard.
What seems to be happening now is that the figures are improving. Here in France, we now know that high school students for instance go back to
school on Monday and from May 19th, you're going to see a return to some sense of normality.
Not only will the travel restrictions have been lifted from Monday largely within Europe, but you're going to see businesses open again, terraces open
again, cafes, restaurants, museums, all of those things that are really an ability for people to spend.
And those figures, when you look at what the European Central Bank is projecting for the second half of the year are far more encouraging.
You're looking at growth they predict of more than four percent, more than four percent against next year, by which point, they predict will be back
to pre-pandemic levels.
So, that's how fast thing are going to go now, but really, the people being able to get out there and spend once again, Julia at long last.
CHATTERLEY: Yes, that got your enthusiasm going there at the back end of that report. So, fingers crossed for next week.
Okay, let's try to get back to India now and Clarissa Ward. I think we've managed to reestablish connection. Clarissa, can you hear me now?
WARD: I can hear you, Julia. Sorry about that technical difficulty earlier. But we are here in this long, long line. It snakes all the way
around the block over there and these people have been waiting to try to get precious oxygen. It's in such short supply. Many hospitals simply don't
have it.
These people, some of them tell us, they've been waiting since five o'clock this morning. Some of them say they came here last night. People are taking
shifts, taking turns to wait in this long line, and the terrible thing is, Julia, once you get to the front of the line, and I have to tell you, the
line does not move quickly, there is absolutely no guarantee even that you're going to be able to get any oxygen because the demand is so huge.
Excuse me. Excuse me. Forgive me.
And the supply is so little. The government says it is trying to address this problem. It has started a program called Operation Oxygen Express
trying to deploy liquid oxygen on the India's railways to the places and cities that need it the most, but here on the ground, honestly, Julia,
we're not seeing or feeling the impact of those efforts yet.
What you're seeing and feeling is a growing sense of anger and frustration and desperation as people wait for days on end trying to get their oxygen,
trying to help their loved ones to breathe.
We've talked to people in this line who are getting things for their grandparents, their parents, their children sometimes. No one in India is
completely spared from this tragedy -- Julia.
[09:10:12]
CHATTERLEY: Clarissa, when I introduced you before, I mentioned a spokesperson for the BJP Party who had said, look, we bear responsibility.
We were ill-prepared for this second wave. What are the people saying about the lack of preparedness? Are they angry, upset, furious with the fact that
they're having to struggle and they feel alone?
WARD: Yes, there's definitely a lot of anger. There's a lot of anger as well because just a few months ago, Julia, this country's leadership was
basically doing a victory lap saying that essentially COVID had been defeated.
They were allowing and even encouraging huge political rallies in state elections in West Bengal and other states. They were allowing cricket
matches. Movie theaters were open. Weddings were being held.
The Kumbh Mela, which is an enormous Hindu pilgrim drawing millions of worshippers into the same space was allowed to take place, and a lot of
people here feel like that was completely irresponsible and that the steps weren't taken that needed to be taken, such as ensuring there were more
hospital beds, ensuring there was enough oxygen concentrate, ensuring there is enough remdesivir, ensuring there are enough vaccines.
We heard the Prime Minister, Narendra Modi just yesterday saying, okay, as of tomorrow, May 1st, anyone over 18 can go and get vaccinated, but that's
not true, Julia. Already, several states have come forward and said, we can't promise that we can deliver on that because we don't have the
necessary supplies yet.
So this is a chaotic situation and while people may appreciate that the government is owning up to its responsibility and failing to mitigate this
tragedy, that doesn't really do a huge amount for the people on the ground here on the ground who are struggling to get by.
CHATTERLEY: Yes, it doesn't stop the suffering today. They have to respond quicker now.
Clarissa, great to have you with us. Stay safe, please. Clarissa Ward there.
And as I mentioned earlier, you can see Clarissa's harrowing report from inside India's hospitals in the next hour on CNN.
Okay, let's move on. Next up, Amazonian scale growth from Amazon. The tech giant saw profit more than tripled in the first quarter to over $8 billion
as consumers spent online and more companies relied on its Cloud services.
Clare Sebastian has been pouring over the numbers. Clare, I read actually that the profits that they made in the 12 months ending March 31st is more
than the profits that they made in the entire three years up to 2019. We can't even get a sense of the scale of the earnings over the past pandemic
period.
CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes, Julia, I think it's very clear that the pandemic has been extremely good for Amazon even though it's
been very expensive. They said that they spent about $2 billion on COVID-19 related costs in the quarter. They are still going to spend, they say, $1.5
billion in the next quarter.
But despite that, the profitability of this company is just extraordinary. And I want to point out one number, because AWS, which is Amazon Web
Services, the streaming service, still remains a key engine of profitability. It was about 12.5 percent of sales, but 47 percent of
operating income.
So, look, they have already got the economies of scale in their e-commerce business that allows them to be profitable there. Add to that the huge
profitability and relatively lower cost of AWS and you see how this engine of Amazon is growing and it is not just those two things now. They have an
advertising business that grew some 77 percent year-on-year along with a few other things that is in the category called "Other."
And international also was up 60 percent year-on-year, so extraordinary numbers. And one more thing to point out, Julia is the guidance. The
company says that in the next quarter, they expect net sales between $110 billion and $116 billion, that's up 24 to 30 percent year-on-year.
Still, the numbers that are in line are or even slightly higher with what we saw pre-pandemic. So that suggests that this wasn't sort of a one-off
pull forward in demand. Some of this change will be enduring when it comes to the growth of this company.
CHATTERLEY: Yes, it is quite fascinating, isn't it? I read this morning, Amazon, Apple, Google, Microsoft, and Facebook earned $75 billion in Q1.
These really are titans and we've run out of adjectives quite frankly to describe them.
Clare, thank you so much for that updated there.
Okay, let me bring you up to speed now with some of the other stories making headlines around the world.
Israel is opening an investigation into possible criminal negligence by police following a deadly stampede at Mount Meron, Thursday night. That
according to the nation's Attorney General.
Dozens were killed when a crush occurred in a huge crowd at a religious festival. Journalist, Elliott Gotkine is at the hospital where they are
treating patients in Tel Aviv. Elliott, great to have you with us. Just us a sense of what the update is on those that were injured and also, do we
know actually what happened?
ELLIOTT GOTKINE, JOURNALIST: Julia, just slightly correct you there. This is in fact Israel's Institute of Forensic Medicine that is over at the
other side of those trees. That is where the bodies of the people who have died have been brought.
[09:15:10]
GOTKINE: A police spokesmen told us they have been arriving over the last three hours and that inside, there are dozens of people trying to identify,
to look at the bodies, to see if among them, they can find their loved ones, or friends, or family who may have perished in this crush last night
at that religious festival.
There are still around about 20 people who are critically ill in hospital, so that death toll of 45, which is where it stands right now, could of
course rise further.
Overall, there are around about a hundred people injured, but most of those were suffering from broken bones according to the Health Ministry. They've
been patched up and sent home.
Now Prime Minister Benjamin Netanyahu described this as one of the worst disasters to befall the State of Israel. He said that seeing what had
happened was heartbreaking and he said that Sunday, he designated Sunday as a national day of mourning.
We're still trying to understand exactly what happened, but it does seem as though there were just a lot of people and in one particular part of where
this festival was taking place, this gathering was taking place that there was a bit of a bottleneck, that there was a bit of a crush and people
slipped and fell on top of one another. One local media outlet describing it as a human avalanche.
But of course, as you say, there is an investigation ongoing and they will try to establish and clarify precisely what happened last night.
CHATTERLEY: Yes, and our best wishes with those that are injured of course and their families.
Elliott, grateful for you for joining us today and thank you for the correction on where you are, from Tel Aviv there. Thank you.
All right, still to come here on FIRST MOVE. Apple squeezed. The E.U. says the company broke the rules to create a music monopoly.
And stemming climate change, we take a look at a new carbon offset market paying lumber jacks not to fell trees.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE this Friday. What a week it has been for investors filled with FAANG festivities, strong economic
activities, even space race hostilities between Jeff Bezos and Elon Musk, the world's richest man, one of them got a little richer this week as well.
[09:20:10]
CHATTERLEY: No lift off though into the stratosphere for the Wall Street majors today. The S&P 500 set to pull back from records, but Jeff Bezos
basking in the glow of sky high Amazon sales, more than $100 billion worth last quarter.
I have to say, it has been a FAANG frolic overall this week with four members of that exclusive tech family showing that they can thrive even as
vaccines let some emerge from lockdowns.
Revenues for Amazon, Facebook, and Apple all up well over 40 percent this past quarter. Alphabet, the relative underperformer with sales only, and I
say only up 34 percent.
The E.U., however upsetting the Apple cart this Friday. E.U. Competitions Commissioner, Margrethe Vestager announcing just hours ago that she is
filing antitrust charges against the company accusing Apple of anticompetitive behavior within its App Store.
(BEGIN VIDEO CLIP)
MARGRETHE VESTAGER, E.U. COMPETITIONS COMMISSIONER: Our preliminary conclusion is that Apple abused its dominant position for the distribution
of music streaming apps through its App Store and distorted competition in the music streaming market.
(END VIDEO CLIP)
CHATTERLEY: The E.U. acting on a complaint from Spotify which competes with Apple Music in the streaming space. Challenging Apple's 30 percent
commission on in-app purchases saying it results in higher prices for consumers and for not telling those consumers that there are other ways to
pay.
Dan Ives joins us now. He is Managing Director of Equity Research at Wedbush Securities.
Dan, great to have you with us. What do you make about this and how concerned are you because it doesn't just focus on music. This is for every
user of apps and the things that they buy in them.
DAN IVES, MANAGING DIRECTOR OF EQUITY RESEARCH, WEDBUSH SECURITIES: Yes, and they are going after the crown jewel of Apple, the App Store, services
that is about $65 billion to $70 billion annual revenue stream, and I think this is something we are going to see more of this -- drum roll --
regulatory, not just in Brussels, but in the Beltway against Big Tech.
Apple, of course, is front and center. I think right now the Street's view in this is a contain risk likely more fines, but I think it's just the
start of this Game of Thrones battle between Big Tech and Brussels.
CHATTERLEY: You were one of those that had the best, I think, adjectives for describing Apple's quarter, if we stick with that, you called it
Picasso-like. They are the Tom Brady of the tech world.
Just talk us through the earnings, and as you said, this is something perhaps that investors can compartmentalize even if they know the battles
with Brussels are just beginning.
IVES: I think that's what you've seen across Big Tech. I mean, Apple's numbers in all of my years covering, it's one of the best quarters I've
ever seen. It is 17 percent iPhone beat services beat by 600 bips, and what you're starting to see now is Apple, they are getting stronger in terms of
monetization as part of the super cycle.
Now, the stocks are flattish to trading down because investors are skeptical that is sustainable, just like we saw from Amazon last night. But
I believe we're just in the middle innings of a rerating in tech.
We still think NASDAQ 16,000 by the end of this year.
CHATTERLEY: I mean, the skeptics are going to say, look, this kind of growth, some of it was tied to that pandemic, to our greater usage of
technology, to greater Cloud use in certain of these tech cases.
Specifically for Apple, the criticisms have been there on valuations since they were worth $1 trillion in terms of market cap. Now, we're talking $2
trillion market cap. I am sure, they will be there if they get to $3 trillion.
Dan, what's your view? Is it still a buying opportunity for Apple?
IVES: And that's my view. I mean, the haters are going to hate it at $1 trillion; scream as it goes to $2 trillion and at $3 trillion, just pulling
their hair out, but at the end of the day if you look at what's happening in terms of the monetization in Cupertino, the super cycle going into
services, I believe more and more, this is a stock that is being used as software services hardware play and that's a rerating higher in numbers
movement. I still think a year from now, it's a $3 trillion mark cap.
CHATTERLEY: In just a year.
IVES: My view a year from now, we're looking at stocks that is somewhere from $185.00 to $200.00.
CHATTERLEY: Wow. Talk to me about Amazon.
IVES: Look, it is the same theme. I mean, Amazon, not just on e-commerce, but if you look at Cloud, I mean, that's really what was always a jaw
dropper, because there was some skepticism, Microsoft gaining more and more share versus Amazon.
But I think, it just shows, this digital transformation, $2 trillion that is going to be spent over the next decade, Amazon and Cloud monetizing in
the e-commerce and advertising. That continues to go forward guiding strong. Stock will be up a bit today.
But I think this is more of a digestion here. I think we look out to coming weeks and months, these FAANG names are much higher despite what has been a
frustrating week for investors after these numbers.
[09:25:04]
CHATTERLEY: Yes, it is quite fascinating as well to mention, advertising where Amazon is concerned, but when you look at the numbers from the likes
of Alphabet with their performance for Google, with Facebook and their monster earnings that they provided, the more people turned to the internet
to buy things, to work from home, the more eyeballs follow, therefore, the advertisers follow.
And this is another potential diversification opportunity for Apple and it is nothing right now as far as their business is concerned relative to the
Cloud and for the e-commerce business? Surely this particular trend to snatch market share there, too, please.
IVES: It's a tidal wave of spending that's going to happen on the digital and so you've seen them. Google, they're really front and center, that was
just massive talent. But Amazon is not going to be on the outside looking in, in terms of this party, just given the amount of money that's going to
be spent as well as their ecosystem and Prime membership.
And I think you're going to see more of an arms race on digital advertising and this is something Amazon, they're not just going to stay in their swim
lane, they're going to continue to expand. This is one area I expect them to go after.
CHATTERLEY: Tesla very quickly, Dan, there were some questions about the profitability that we saw and the origin of those profits, whether it is
tax credits or Bitcoin. Is Bitcoin a distraction? What do think right now?
IVES: Look, I mean, Bitcoin -- look, to this point, Bitcoin they've made more than a billion in terms of paper profit. Of course, it adds noise to
the story. But this all comes down to deliveries and the EV, the green tidal wave that we're seeing, China continues to be strong, the trajectory
going forward is bullish for Tesla, and this is another one.
Chip shortage aside and they could be 900,000 units this year. And as they get there, then this is a four digit stock.
CHATTERLEY: Okay. Bullish as ever. Dan Ives, the Managing Director of Equity Research at Wedbush Securities. Always great to chat with you, Dan.
Thank you.
Okay, the market opens next. Stay with us.
(COMMERCIAL BREAK)
[09:30:04]
CHATTERLEY: Welcome back to FIRST MOVE. U.S. stocks are up and running on the last trading day of April and no mayday signal for stocks. We are
weaker in early trading after another record setting close for the S&P 500. Investors hitting pause even as new report show continued economic
strengthening in the United States.
Personal spending rising 4.2 percent in March, a hotter than expected read on prices, too. The closely watched PCE Core Inflation Index rising by half
a percent last month and well over two percent year-over-year. Remember, that's a data point that the Fed watches very, very closely.
Encouraging economic data in Asia, too, with Taiwan reporting its fastest rate of growth since 2010 helped along by demand for precious computer
chips that drove up prices there.
Now, returning to India and our top story where more than 208,000 lives have been lost from COVID-19 as hospitals and other healthcare facilities
are stretched beyond breaking point.
The OYO Hotel Group is lending its support and Ritesh Agarwal is the founder and CEO of OYO Hotels, and he joins us now. Ritesh, great to have
you with us and thank you for sharing your time.
Before I ask you what you and the team are doing, I just want to ask how you're doing? How are you all handling this?
RITESH AGARWAL, FOUNDER AND CEO, OYO HOTELS: Thank you so much, Julia, for speaking to me, now, the second time after the pandemic struck. I remember
meeting you right before the pandemic struck. Thanks for asking. I'm doing okay.
My family is doing okay. Unfortunately, both my sisters and their families are affected, but they are recovering quite quickly.
CHATTERLEY: Okay, well, that's good to hear. And we keep our fingers crossed for full recovery here. Just explain what OYO Hotels is doing to
try and support because, as you quite rightly said, we spoke when you launched OYO Care, and you were providing hotel rooms to government, local
government workers, workers of corporations, as well. Explain what you're doing this time around and how it differs?
AGARWAL: Look, I think it's a little bit of -- first off, I think it's important to acknowledge and understand that we are dealing with a
significant second wave here in India in which the cases and your healthcare situation continues to remain quite challenging.
It's a combination of two things that we're doing, Julia. I think the first perspective is a little bit of the same. That is, if remember, last time,
even the White House acknowledged it that we had progressed in bringing free room nights for the frontline workers and so on that we of course
restarted again, bringing rooms for frontline workers.
But a few new things that we have brought in are asunder. The first bit is, at this point of time, what we've seen is a lot of people require just a
place to be able to -- a shelter to be able to recover, for which we have set up isolation centers. We are launching a campaign today with Give India
which is a prominent, you know, organization here in which people who are underprivileged, and when they require basic oxygen healthcare
requirements, et cetera, at that point of time, the one thing that we can solve for them is give them a shelter or a roof over their head when they
recover from COVID.
So we are launching a program to enable underprivileged people to stay for free at our places at the time in which they are recovering.
And the third is, you know, one of the most important things that is missing or that we want to provide to people is oxygen. So we are planning
and working on importing as much oxygen concentrators as possible for people and communities around ourselves.
So this just gives you a context of the kind of efforts on isolation, place to recover and as much oxygen concentrators as we can.
CHATTERLEY: This is -- this is fantastic, and I can see you're doing whatever you can to help. Just give us a sense when you're talking about --
and you mentioned people who are underprivileged, and you're providing these isolation services for free. How many people are we talking about?
How many people can you cater for? And how many people are you already helping?
AGARWAL: So we are starting today, and we're starting small, frankly. We are starting with only three buildings at this point of time, close to a
hundred rooms a night, but we have substantial capacity here in India.
You know, as you know, last time, when we spoke, we had close to 300,000 rooms in India. So given that scale, we can try and support a large volume
of people. But frankly, we have to do it with substantial amount of care as well, because these are people who are affected and hence they need
dedicated facilities, a little bit of healthcare support.
So we're trying to bring in healthcare providers to come in and support these facilities as much as possible. So that just gives you the context of
some of the challenges that we have to solve for, but we can scale this up substantially, but my hope and belief is that we should not require this
for, you know, a very large volume of people for a very long time. That's what I'm hoping and praying for.
[09:35:03]
CHATTERLEY: Yes. And we pray with you on that point. You mentioned it, too. It's not so simple as just providing rooms for people to stay. It's
also the support staff around. What are you doing to protect those people to make sure that they don't get sick, too?
AGARWAL: Yes, I think that's an -- I'm glad that you're bringing this up, Julia. I think at this point of time, our big focus is making sure that the
people who are supporting them have to be one of the two.
The first is, we are typically trying to bring in frontline workers who have worked for or who worked for some of the healthcare companies. Most of
the healthcare companies' employees have already been vaccinated in India, because the first people who were welcomed for vaccination were actually
the healthcare workers.
And on top of that, in our hotels, we are working to launch a vaccinated tag because as you're aware, from May 1st, every adult in India is eligible
for vaccination. Our hope will be to make sure that we can enable a lot of our staffing also to be vaccinated, even in the non, you know, centers for
people and COVID -- people who are traveling in general, to just make sure that they can see which hotels have the staff vaccinated in order to bring
trust and confidence for people to come in and stay in those places.
CHATTERLEY: I mean, two things, this obviously costs your business money. How are you financing this, Ritesh? And if you can scale this up and scale
it up quickly, and I know people can book on the app, because I've looked, but surely working with local governments is the answer here as well, not
only to spread the word, but to get back up here and able to scale this, are you talking to the government, too?
AGARWAL: Look, I think we are working with the governments, but at the same time, I must really thank the communities around ourselves. So for
instance, Give India, which is a leading program, you may have seen yesterday, one of India's very well prominent faces in the U.S., Priyanka
Chopra, she started a campaign as well with Give India.
They have started a campaign with us to try and, you know, get communities to support this initiative, to get a lot of underprivileged people free
accommodations. And the second is, of course, actively working with governments as well.
And, you know, frankly, we are trying to also encourage our own community of hotel owners to try and support in whatever manner they can and the
healthcare providers. So it's a little bit of everything. You know, at this point of time, you know, our focus is to try and just make sure that we do
everything possible with the resources we have to ensure that, you know, we can help the people to whom -- they're not immune of the pandemic, right,
the people who are underprivileged, who have limited resources. They, in fact, have bigger challenges with this.
CHATTERLEY: Huge challenges. I mean, Ritesh, we've been showing our viewers, crematoriums that are working day and night, people angry,
frightened, crying on the streets.
I mean, it's heart wrenching for anybody watching this, no matter people in India that are having to suffer it personally. Are you angry with the
government, Ritesh, that there weren't enough warnings that this could happen? That people were voting, going to elections, going to religious
ceremonies, rather than being prepared for something so tragic to happen?
AGARWAL: So look, at this point of time, I must say that I, our company, our communities, our ecosystem, our towns, everybody's only focus is to
fight and win this battle against the second wave of COVID. Frankly, there has been no time to reflect on, you know, what could have been done better.
But clearly, everyone, right from the communities, our people, the entire country could have been better prepared. But I think at this point of time,
you know, I can tell you that everybody is doing the best they can across the ecosystem.
And, you know, at this point of time, frankly, we wake up every day and the intent is to try and make sure that what can we do to help our communities?
That's the only thing that we are focused upon at this point of time.
CHATTERLEY: Yes, the fight to save lives. That's the bottom line and the most important thing at this moment.
AGARWAL: And vaccination is the single biggest focus in that, Julia. I think we're seeing these in markets around the world. You know, I mean,
it's amazing to me. I speak to our friends in the U.S., our web partners in the U.S. are more than two times of what it was last year, same time.
So the domestic travel is booming in the U.S., the lodging revenue has been probably the highest I have seen, at least in my history. And on the other
hand, I see here in India that, you know, we are facing the challenges we are, I think the only thing that we've got to work on is vaccination.
If we can vaccinate a large part of our population, which we have had a history of doing, I think we will we will save lives and make sure that our
country gets back, you know, running again.
CHATTERLEY: Yes, like we said, we pray for that and we pray for all of you that are suffering at this moment and of course your sisters and their
families, too. Ritesh, thank you so much for that. We'll speak again soon. Stay safe, please.
We're back after this. Stay with us.
(COMMERCIAL BREAK)
[09:43:07]
CHATTERLEY: Welcome back to FIRST MOVE. Lumber prices in the United States are sky high having tripled over the past year. Some might say that's a
lucrative opportunity perhaps for landowners, but one company wants to pay them not to fell trees.
SilviaTerra is a carbon offset marketplace allows companies to pay timber owners to keep forests and ecosystems intact, and thereby helping offset
the company's carbon footprint. It's a clever scheme.
Joining us now is Zack Parisa, he is co-founder and CEO of SilviaTerra. Zack, great to have you on the show.
I love this concept, but we have a lot to discuss. And I want to begin with the technology, the artificial intelligence and what you do just to work
out what trees, what the ecosystem looks like in parts of America. And that's the sort of basis of how this works. Explain.
ZACK PARISA, CO-FOUNDER AND CEO, SILVIATERRA: That's exactly right. Julia and great to be with you here.
So just like you say, so we're taking a massive amount of satellite imagery, imagery of you know, forests all over the United States, pairing
that with ground measurements and producing basically map or an inventory of every tree in the U.S. by species and size.
And it's that kind of measurement, those kind of data and information that allow us to create this market that we're talking about today, a market
that connects landowners, forest landowners throughout the United States with, you know, net zero pioneers like Microsoft, Salesforce and others,
helping them offset their carbon emissions by paying landowners to not cut, to grow more carbon on the landscape.
And so it's an exciting opportunity for landowners and something we've seen an awful lot of interest in in. Yes, glad to be talking with you about it.
CHATTERLEY: I mean, I mentioned the lumber prices rocketing for a reason because when I was reading about what your company does, I was thinking,
hang on a second, does this mean that some of the landowners would be like, look, I think this is a great idea, but actually I want to utilize higher
prices and the opportunity cost of not felling these trees now is higher.
And that, again, is what's quite unique, I think about what you're doing is the concept of auctioning. Tell us about how the landowners say, look, this
is what it is worth to me to keep these trees in the position they're in right now and protect the ecosystem versus selling.
[09:45:28]
PARISA: Right. Yes, so one of the surprising things, when we look at the rise in lumber prices is that that has not translated to an increase in
price of timber or logs that that landowners are sending to the mill.
And so for them, really the only opportunity that they have to, you know, to receive financial gain from their property is to harvest those logs, is
to -- or to sell the land itself.
And so there is a cost to extending the rotation for these landowners and what we're making possible is basically for each of these landowners by
simply clicking on their property, we indicate what the likely harvest volume is from their property and allow them to state the price at which
they would be willing to defer harvest, to wait just one more year and to grow their timber a little bit longer, you know, sponging out a little bit
more carbon from the atmosphere.
And by running that reverse auction, we can identify the lowest cost carbon on the landscape and provide additional financial incentives for growing
these trees, growing these forests.
CHATTERLEY: And you've already done this.
PARISA: That's right. Yes. So we had run a pilot with Microsoft in Pennsylvania that wrapped up last year, and then starting in January, we
opened this market up to 11 states in the U.S. South.
And in just about eight weeks of having that market open, prior to closing our first -- sort of this first cycle, we were blown away by the interest.
We had over nine and a half million acres of folks enroll -- yes, of land enrolled from the largest institutional forest landowners in the U.S. all
the way down to landowners, just families that have 30 or 40 acres.
So nine and a half million acres is roughly the size of the State of Maryland. So pretty substantial.
CHATTERLEY: I mean, you're going to make this available throughout the United States, I believe as well. It's a great example, I think if the
private sector saying, look, we can do something here to help achieve lower carbon emissions, or at least help companies offset their carbon emissions
and improve their footprint.
I just wonder what role the government plays here or whether there is a role for the government, even if it just helps you scale this because we,
clearly in the United States have a very climate conscious government for the first time in a while.
PARISA: Right. Right. So you know, these leading companies, you know, Microsoft and others have really driven innovation in this field and that's
one of the great things about sort of these, you know, these market based opportunities, market based mechanisms that allow for carbon removal.
But the government does have a role to play, particularly perhaps in helping scale these types of initiatives and there's actually right now
some bipartisan legislation that's moving through D.C. that you know, that plans to do exactly that.
So we're excited to see how that comes together and how that can help enhance the growth of these market based mechanisms.
CHATTERLEY: Land rights matter. The desire to protect ecosystems matter. The desire of companies to take part clearly matters as well. Do you think
this works in other geographies around the world? Is that part of the ambition here? Admittedly, you have a big project with the United States,
but can you scale this beyond the U.S.?
PARISA: Absolutely. So just like you said earlier are, you know, right now, this is available to landowners, you know, for every forest type in
the U.S. South, for landowners in the lake states, New York and Pennsylvania. And by the end of this calendar year, it'll be available to
every single forest landowner in the United States.
The same mechanism that we're using in the U.S., you know, measuring the potential impact for different harvests and paying landowners for their
performance year-over-year can work elsewhere.
And while we plan to expand globally, there is so much nuance to the ecology and especially to the sort of social structure in each of these
places that has to be attended to, so it's not as simple as copy and paste, but certainly taking the same market based mechanisms and making those
available to landowners really to empower them to make decisions that work for them at prices with compensation that works for them to achieve these
benefits that we all need.
Not only just carbon, you know what we're talking about, geographic expansion. We call this the natural capital exchange because -- and not the
forest carbon exchange -- because really, this is meant to work for all of the benefits that we know forests provide beyond just timber. You know,
forest carbon obviously, but also wildlife habitat, water yield, fire risk reduction, all of these things can be brought into better balance using
market based mechanisms that pay landowners to manage in such a way, either, you know, increasing density of forests, or in some cases
decreasing density of forests to achieve that balance.
So, yes, we are really excited again, not only to expand to all of these geographies.
CHATTERLEY: Just the beginning.
[09:50:33]
PARISA: Yes, just the beginning, just the beginning, but it's exciting.
CHATTERLEY: Are you looking for money? Very, very quickly? Are you looking for money? Do you need more investment?
PARISA: So, we'll have some news to share here. We have to see you round - - close to the seed round in November, but we're just -- between interest with, you know these net zero pioneers, you know, these companies, you
know, Fortune 1,000 companies that are making good on these commitments, and at least landowners that are so interested in participating.
Really what we need is just engagement. So it's going to take all of us, you know, landowners, companies, government, NGOs, academic community. And
so, you know, there's so much technology and thought and good work that needs to be brought to bear to bend the arc on climate change. Trees are
just part of that. And so yes, we are excited to --
CHATTERLEY: Now, we just need action. I have to wrap you up, because I don't have time, Zack.
PARISA: Of course.
CHATTERLEY: Action. Great to chat with you. Zack Parisa, founder and CEO of SilviaTerra, thank you.
PARISA: Wonderful chat. Again, thanks.
CHATTERLEY: Thank you. Great work. We are back after this. Stay with us.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE. While much of the world paused amid the COVID-19 pandemic, one firm kept moving on its plans to utilize
the skies to get us around. As Bianca Nobilo discoveries in the latest part of CNN's Road to the Future.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: Hey, Doc, we've got to back up. We don't have enough road to get up to 88.
UNIDENTIFIED MALE: Roads? Where we're going, we don't need roads.
BIANCA NOBILO, CNN CORRESPONDENT: In 1985, "Back to the Future" envisaged a world with flying cars zooming around the sky. Well, it's 2021 and I
still don't see them.
But it's far from the world of just science fiction now. The concept of urban air mobility is edging closer to becoming a reality. The Brazilian
plane maker, Embraer is one of those leading the way.
NOBILO (voice over): Forget flying cars, meet the eVTOL. It's the catchy name for an Electric Vertical Takeoff and Landing aircraft. This one is a
concept being developed by Eve, a spinoff of EmbraerX, the innovation arm of the Brazilian aerospace conglomerate.
UNIDENTIFIED MALE: Everyone has been stuck in traffic jams at certain point of their lives. So to bring everything that aerospace and aviation
brought to transportation in general, literally closer to the people in each of the city developing a vehicle that could fly within the city with
no addition to the city noise or emissions. Finding solutions that could make air mobility a viable opportunity.
[09:55:12]
NOBILO (on camera): Flying cars have become something that everyone talks about when they think about the future of transport, but they don't
materialize. It just doesn't happen.
So, how far are we from making eVTOL as part of mainstream?
UNIDENTIFIED MALE: It is exactly that type of the technology that can disrupt aviation. It will be some years before we can have a commercial jet
that is really electric that we can really fly a hundred people thousands of kilometers away, but the technology is ready to fly a few.
And just to make it clear, we are not seeing a total replacement of cars or the world of "Blade Runner" or "Jetsons." It is about providing another
option.
NOBILO: Do you think urban air mobility or advanced air mobility is going to become a reality in our lifetime?
UNIDENTIFIED MALE: Absolutely. I think it will become a reality during this decade.
(END VIDEOTAPE)
CHATTERLEY: Okay. That just about wraps up the show. Stay safe this weekend and we'll see you next week.
"Connect the World" is next.
(COMMERCIAL BREAK)
[10:00:00]
END
