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First Move with Julia Chatterley
The Fed Governor testifies before Congress Today; The E.U. Unveiling a Multiyear Green Transformation Plan; REvil, The Ransomware Gang Disappears from the Internet. Aired 9-10a ET
Aired July 14, 2021 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:17]
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.
Powell's pricing pressures. The Fed Governor testifies before Congress today.
Climate committed. The E.U. unveiling a multiyear green transformation plan.
And REvil revoked. The ransomware gang disappears from the internet.
It's Wednesday. Let's make a move.
A warm welcome to the program. It's a special French FIRST MOVE this Bastille Day. It's a day of liberty, equality, fraternity, as well as Jay
Powell credibility, bank earnings, agility, and inflation susceptibility, perhaps.
We also have a magnifique list of guests on tap as well. We'll be talking transformative tech, but also the challenges of operating in South Africa
given the current tensions and protests with the CEO of South African food delivery startup, Yebo Fresh.
Plus, the CEO of cybersecurity firm, CrowdStrike, on the mystery of ransomware gang REvil -- the hackers web page has literally vanished
online, but the question is, are their days of terrorizing big business over? Well, we'll discuss later.
Plus, inflation fears certainly not over for consumers, no investors. U.S. futures are higher right now despite a fresh price punch. Just released
numbers show wholesale inflation spiking more than seven percent year-over- year last month. The base effect remember of a year ago, as we were discussing yesterday, critically important to remember here, but
perennially patient, an old puissant Fed Chair, powerful Fed Chair Jay Powell, testifying before Congress today says in his prepared statement
that he is still not ready to change policy. He is still counting on inflation, being transitory. We'll discuss that, too.
Europe, losing ground meanwhile, and climbing a Montblanc size mountain of pricing concerns, too. U.K. consumer inflation numbers show prices creeping
above Central Bank targets; and in Asia, China closed one percent lower as investors brace for key growth data. GDP data out tomorrow.
In the meantime, U.S. corporate earnings season heating up like a good flambe, Citigroup, Bank of America, and Wells Fargo all reporting solid
profits, but slower fixed income trading, lower interest rates, and sluggish loan demand put some pressure on results.
Let's take a look at all of this in our drivers. Time to escargot. Christine Romans joins me now. I'll tell you what, Christine, nothing smell
like about you, nor about the pricing pressures that the U.S. economy is facing, though, again, I reiterate the base effects relative to what we
were going through this time a year ago, are very important when we're talking about rising prices.
CHRISTINE ROMANS, CNN BUSINESS CHIEF BUSINESS CORRESPONDENT: It really is. Look, inflation is running hot. There's no question there and it is hotter
than many had expected at this point. But you're coming from the lost summer of 2020, when things stopped. In fact, when things cratered.
You had a recession last summer. So now, you're seeing these bounce backs that look very dramatic. And certainly if you're going to the gas pump in
the United States, you can feel it every week when you're buying goods. And certainly the lower income you are, the more you're feeling these price
increases. But how long will it last? And will it work itself out?
That, Julia, is the big debate of our time right now. You have some people weighing in, like Larry Summers, and Larry Fink and Jamie Dimon from
JPMorgan Chase saying, look, inflation is going to be a worse problem than the Fed is thinking. This is going to be a problem. And many others,
including many Fed officials who say no, once you get supply chains worked out, this will start to go back to normal.
There's also this big debate about how for 20 years or so, we've had very, very low inflation. And a little bit of inflation here is just something
we're not really used to. But seriously, the inflation debate has been fascinating and the stock market continues to just shrug it off, maybe
little blips here and there, in the bond market quite frankly, as well. That's what we're really watching to see if there are any big changes in
expectations in the bond market.
CHATTERLEY: Yes. And we're simply not seeing it at this stage. But it is starting to feed into consumer expectations of where prices are going.
ROMANS: Yes.
CHATTERLEY: Do I buy today? Because I think that something is going to be more expensive in the future versus hanging on for purchases, and that's
important when it comes to the thinking of the Federal Reserve and Jay Powell and clearly, I think in front of Congress over the next two days, he
is going to be asked these questions of congressmen: are you right to hold off here and assume that all this is going to go away and ease?
ROMANS: Yes, what will Jay say? That is the big question. I can rhyme a little bit, too. I am not as good at rhyming as you are and alliteration --
CHATTERLEY: I get a bit more time though.
ROMANS: But I will try. But really we've seen his testimony. You've seen his testimony. He will talk later today.
[09:05:08]
ROMANS: He will be questioned, of course, about how convinced is he that this will all be transitory? And what will inflation look like sometime
next year?
But remember, this year -- he'll say this, this year will be the best economic growth the United States in decades -- in decades. This is a
roaring back from the crisis we had last year, very strong performance in the U.S. economy.
Jamie Dimon at JPMorgan Chase also saying, look, consumers are feeling good. Their stock prices are up. Their house prices are up. Their savings
are up. Their incomes and wages are up. For them, the pandemic is in the rearview mirror.
I'm not sure we can say it's completely in the rearview mirror, you know, we still have thousands of people contracting the virus, and you have the
delta variant, which is still a risk for the economy and the stock market overall.
But the inflation debate, certainly fascinating here, as you try to as -- we just don't have a blueprint, right, for this kind of recovery from a
health pandemic.
CHATTERLEY: As we always say, forecasting, this has been impossible all the way through and remains so.
Christine Romans, thank you so much for that.
ROMANS: You're welcome.
CHATTERLEY: Going green: the European Union unveiling its most ambitious plan yet to tackle climate change with its central goal to cut carbon
emissions by 55 percent by 2030. That's compared with 1990 emissions levels.
Anna Stewart joins us with more. Anna, I think we have to put this in perspective in terms of the ambition here. It puts Europe way ahead of
other developed nations, admittedly, if they can fulfill and follow through on these ambitions. Perhaps not so great on the marketing of this, the Fit
for 55 seems to have been quietly dropped. Just the highlights, please.
ANNA STEWART, CNN REPORTER: Yes, we're now calling it the Green Deal, Julia, which I must be frank, I can remember that one.
This is really ambitious. The Europe -- sorry, the E.U. wants to be the first climate neutral continent in the world. So, that's by 2050.
Now, this package overall sees while the cost of nonrenewable fuel being hiked up, we are talking about taxation, also big cuts on carbon trading
limits, and also just a huge focus on transport.
Now, we were talking about this yesterday with the Volkswagen announcement, and that's exactly really as we expected. Transport accounts for over a
fifth of all emissions from the E.U. So, that is a huge focus. They want to reduce it by 90 percent by 2050.
So for cars, well, they are saying those new cars by 2030 will have to reduce their emissions by 55 percent, and just five years later, by 2035,
by 100 percent. Similar targets for vans as well. So essentially Julia, what we're saying here is, bye-bye combustion engines, hello electric; and
also actually hydrogen, a big focus there, too.
For airlines, a push for sustainable jet fuel. I thought this one was really interesting. Currently, airlines use just 0.05 percent of
sustainable fuel. From 2030, the E.U. wants to make some sort of sustainable blended fuel, the only option for airlines refueling in E.U.
airports and they want to oblige fuel suppliers to increase the blend of sustainable they have from 2030 right through to 2050.
So, quite a lot in there, how they go about it, though the detail, yet to come.
CHATTERLEY: And that's the crucial point. I mean, we spoke to the E.U.'s climate envoy, Frans Timmermans last week and he openly admitted they were
going to get so much pushback as a result of this. How easily is this going to be done? Two challenges for me; one, the debate within the 27 nations in
the E.U. Parliament over what this looks like; and then, translating this into policy, ultimately, to bring those ambitions down.
It's ambitious, Anna, it's going to be incredibly challenging to fulfill whether it's needed or not and that debate rages on, too.
STEWART: Nothing like a challenge. There's the practical aspects. What is the balance of carrot and stick for each industry? Does it actually help
them transition? Does it protect jobs? Or does it do the exact opposite?
And as you say, the politics here will be so difficult. This is a proposal from the E.U. Commission, and it needs to go through the Parliament and the
Council. We know that this will be more costly, this transition for some countries than others. Well, how is that going to work with an E.U. Member
State voting for something that will actually cost its economy dearly.
Then you've got the issue of the Parliament. We know a big chunk of MPs, they actually feel these proposals go far enough. On top of which, you can
expect any vote on the Green Deal to become as all votes in the E.U. are a proxy for other issues, whether we're talking about migrants, whether we're
talking about rule of law, this could go on, but you have to applaud the ambitious targets being set here -- Julia.
CHATTERLEY: Yes, and the detail, unlike other nations, the U.K., just to name one.
Anna Stewart, thank you very much for that.
All right, let's move on. Hackers hacked. The cyber hackers known as REvil have mysteriously vanished from the internet.
The Eastern European ransomware group infamously attacked meat supplier, JBS Foods just a few months ago, among others. Matthew Chance joins us now
from Moscow.
Matthew, uncanny timing in light of the discussions between President Biden and President Putin, of course, on tackling cyber security threats, but
what do we know? Just give us the details on the disappearance.
[09:10:07]
MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, I mean, we know that REvil, this collective -- this criminal collective ransomware
group has disappeared from the internet. You know, the sites that are there to negotiate with the people they victimize or attack, the infrastructure
that is there for people to make payments to the criminal gang to release their data, that's been taken offline as well. So, it all sort of
disappeared.
We don't know why -- well, we don't know why it's disappeared. But you're right, the timing of it is interesting, because it was just last month that
President Biden, along with -- you know, discussed with President Putin the national security issue of cybercrime with him in there face-to-face
meeting in the Presidential Summit in Geneva.
There was a phone call about the issue just last week from President Biden to President Putin as well. And so, you know, it's tempting, isn't it to
think that the Russians have, you know, heeded the warnings from the United States, and have acted to crack down on these criminal gangs that are said
to be operating from Russian territory.
But that's not something obviously that the Russians are admitting. We spoke to the Kremlin earlier today, and they said, they've got no idea what
this group is, never mind, you know, what the circumstances are around its disappearance.
And of course, it's not any possibility. It's also possible that the United States could have acted to try and take these -- well, to take these
cybercriminals offline, and it is also possible that the criminals themselves could have decided, you know, the heat is just too hot. You
know, the pressure is too great and they just decided to, you know, pack up their operation and go somewhere else. We may see them reemerge in some
other form later on.
So, yes, you know, interesting developments. The fact that cybercrime has been a major talking point between Russia and United States, and the fact
that one of the most prominent, you know, kind of perpetrators of that crime has now disappeared from the internet, I think is noteworthy and
significant.
CHATTERLEY: Yes, but they haven't have come under scrutiny to your broader point there. So many options of what might have happened here.
Matthew Chance, thank you for laying that out for us.
And we'll continue this discussion later on in the show when I'll be joined by George Kurtz, the CEO of CrowdStrike, a global leader in cybersecurity
to get their take on what may have happened here.
Okay, for now, let me bring you up to speed with some of the other stories making headlines around the world.
Cuban officials say, a man died during clashes with police on Monday. It's the first confirmed death amid the anti-government protests which erupted
on Sunday. Activists say more than 100 people have been detained or reported missing since Sunday.
Patrick Oppmann joins us now from Havana. Patrick, what have we seen today?
Yes, I was wondering whether you could hear him even if I couldn't, but no, we have lost him. We will try and get him back later on in the show. But
for now, thank you to Patrick Oppmann there and we'll continue.
The death toll has risen to at least 92 in Monday's hospital fire in Southeastern Iraq. Officials believe the fire started after oxygen tanks in
the intensive care unit treating COVID-19 patients exploded. Iraq's President has blamed the incident and a similar one in Baghdad in April on
quote, "corruption and mismanagement."
Pope Francis has been released from the hospital in Rome 10 days after undergoing surgery for colon diverticulitis. The Vatican says the Pope
stopped by the Basilica of Saint Mary Major on the way home where he gave thanks for his successful procedure and prayed for those who are sick.
You're watching FIRST MOVE. More to come.
(COMMERCIAL BREAK)
[09:16:14]
CHATTERLEY: Welcome back to FIRST MOVE. An action-packed day on Wall Street filled with news on prices, profits, and Jay Powell coming up, too.
Futures solidly higher despite another day of inflationary sticker shock. U.S. producer prices rising a greater than expected 7.3 percent year-over-
year last month following that hot read, of course, on consumer prices yesterday, too. Fed Chair Jay Powell sticking to his script, however. He is
set to tell Congress that today, inflationary pressures will ease.
Shares of major U.S. carriers are set for takeoff, too. Delta reporting its first profit since the pandemic today. American is pre-announcing a slight
pre-taxed second quarter profit, too.
Apple shares, meanwhile, set to rise to record highs. Reports say Apple is ordering a greater than expected number of new generation iPhones from
suppliers this year, signaling hopes for high demand. Apple also reportedly beating up its Fintech offerings. Reports say it is in talks with Goldman
Sachs to launch a buy now pay later service.
Okay, let's return to Cuba. Officials say a man died during clashes with police on Monday. It's the first confirmed death amid the anti-government
protests, which erupted on Sunday.
Patrick Oppmann joins us from Havana, and Patrick, I think you can now hear me, yes, and we can see you moving. That's great. Patrick, just talk us
through what people are saying amid these protests. What do they want? What are they asking for?
PATRICK OPPMANN, CNN CORRESPONDENT: Yes. Well, you know, it's so many things. They want to be able to go and buy food and not have to wait hours
for it. They want to, in the Cuban summer heat to have power, so they have fans or AC and are not sweltering in their homes. They would like their
relatives to be able to send them assistance directly and not have the Cuban government convert it into Cuban pesos from dollars -- Cuban pesos,
of course, being a worthless currency outside of Cuba and a heavily devalued currency here right now.
So, a lot of people, it's very simple. They just say that they want to be able to live without the restrictions and difficulties that Cubans face
every day. For other people, it is much more complicated. They would like to be able to directly pick their own leaders, have multiple political
parties, have freedom of speech, and have freedom of the right to assembly, something they do not have.
It's important to remember that while the Cuban government says they are cracking down on these protests because they became violent, there are also
people being arrested simply for peacefully protesting. That is something that Cubans do not have the right to do. They do not have the right to
protest against the government and call for change, and that is what many people have done.
We are seeing now images of Cuban Police rounding people up, going house to house, and forcibly arresting them. The Cuban Government says that these
protesters were violent, but we are certainly seeing a high use of force as more and more people are being arrested.
Yesterday, one activist group said over a hundred people have been arrested. The Cuban government has not said how many people have been
arrested, how many people have been injured. One man we do know, was killed in clashes with police. The Cuban government said some of those authorities
were also injured in these clashes.
But right now, there's a large scale effort to tamp down on these protests and keep them from happening again -- Julia.
CHATTERLEY: Patrick, great to have you with us. Thank you so much for that report there.
Not the only place of course where we're seeing protests. In South Africa, at least 72 people have now died during violent protests and looting.
Authorities have arrested more than a thousand people, but have struggled to maintain order.
For almost a week, demonstrations have been clashing with police while looters have gutted stores and set some buildings on fire.
CNN's David McKenzie joins us now from Johannesburg.
David, we saw you on the streets yesterday and you were showing us a building that was on fire. What have you seen throughout this morning and
the hours of the early afternoon?
[09:20:05]
DAVID MCKENZIE, CNN INTERNATIONAL CORRESPONDENT: Well, Julia, just in this part of the country, utter devastation in many malls and shops and just
places of business across Johannesburg that had been ransacked, looted, and destroyed.
We went to one mall, which is the lone-standing mall in Soweto, really the pride of that part of this province that vigilantes had to protect
overnight to stop people from gaining access. It does seem to have calmed down somewhat at this part of the country.
In Durban, though, these are the images of a warehouse, a clothing warehouse and a courier company, totally gutted and on fire. People lining
up to try and get food, some level of panic buying, I think, but there is also a sense that the lawlessness continues in at least parts of KwaZulu-
Natal Province where the authorities haven't been able to clamp down on this, and it's been several days of this.
Even if they managed to get it under control, like the military and police want to, it will be a very, very long time until these communities recover
-- Julia.
CHATTERLEY: Yes, well, David Mackenzie, great to have you with us. Thank you so much for that report.
Now, South Africa struggles to restore order in parts of the country, some businesses, including a breakthrough startup called Yebo Fresh have been
forced to temporarily halt operations. The Cape Town based food delivery company has been growing at an incredible speed, delivering more than
85,000 groceries during the country's first strict lockdown against COVID- 19.
And joining us now, the founder and CEO of Yebo Fresh, Jessica Boonstra. Jessica, fantastic to have you with us on the show. Let's just take a step
back and tell us what you've been doing for the last two years delivering groceries in townships in South Africa.
JESSICA BOONSTRA, FOUNDER AND CEO, YEBO FRESH: Thank you, Julia. So, Yebo Fresh is an e-commerce platform, as you said that is uniquely tuned to
South Africa's townships. We're a young company, we started only three years ago in my garage and have been particularly fast moving during the
last lockdown.
Today, we are operating in two areas, in greater Cape Town and in Johannesburg, and we serve a wide range and very rapidly growing range of
customers from families, who traditionally struggle to get access to stores. And if you don't have a car, you have to travel quite far. But also
container shops, local stores, as well as community organizations, church groups, and NGOs, and schools, the easy biz et cetera.
CHATTERLEY: And a lot of the employees that you are hiring as well, they came from the communities that you're serving.
BOONSTRA: Absolutely. We make a point of hiring local people from the communities that we serve, also, because they have a better understanding
than anyone of what is happening on the ground, what the requirements are, where it's safe to go, and how we make sure that we deliver the best
possible service to this unique market.
CHATTERLEY: And explain the unique market because I think for our audience that either don't live in South Africa or don't understand what a township
actually means, just explain, you know, the kind of areas, the communities that you are serving, because there's a lot of misunderstanding about what
this represents, and truly as a retail customer, what this represents.
BOONSTRA: Yes, absolutely. And you could almost say that there's two South Africa's. The more affluent market, the upper market, and the townships
where actually a very large part of the majority lives.
So these are the less affluent areas that often struggle with challenges, like a lack of infrastructure, lack of access to data, and sometimes
unfortunately, like today with a crime and protests.
CHATTERLEY: So, explain the decision to suspend operations. Is that in order to protect your employees, simply because you can't access these
areas now that are being disrupted by protests? Just give me an understanding of what the company is facing.
BOONSTRA: Yes. Well, this is a difficult decision because of course, our company is a lifeline. Actually, we grew so fast last year, because we were
the party that actually understands how to navigate the intricacies of the township area. And we will be looking to restore deliveries as soon as
possible.
Actually, we are already doing that in Cape Town, and in Johannesburg, given the very warm relationships we have with the communities, we're
looking to get back on the ground as soon as possible.
But indeed, the situation is currently quite volatile. And ironically, of course, as large stores get looted, as the smaller stores are struggling,
one of the ways to get access to food is by delivering it to people.
Unfortunately, South Africans are some of the most creative and resilient people that I've ever met. So, we're already working together with the
local networks, the community networks, with organizations, with other companies to make sure that we restore those food infrastructures including
the smallest stores, get them back up and running as soon as possible to make sure that people get access to food, which is absolutely vital at the
moment.
[09:25:02]
CHATTERLEY: Of course, I mean, I'm sure your supplies as well as your grocery supplies are in a warehouse, either near or in these localities as
well. As far as you know, your employees and your produce as well that, as you described is a lifeline for many of these families and these
businesses, that's all safe.
BOONSTRA: thankfully, everyone is safe. On our team, we have kept the sales team inside for a few days, but they're all very keen to get back out
to make sure that we actually do our job, which is to make sure that we deliver where it's needed most.
Everything at the moment for the team seems to be safe. We're keeping very close contact with the communities and just making sure that we can get
back out as soon as we can. And again, we're restoring those networks as we go at the moment.
CHATTERLEY: Jessica, there's a few things here. I mean, there's the sort of politics that the country is facing at the moment and perhaps how these
protests erupted. But there's also the challenges of COVID that many nations around the world have struggled with, the economic consequences of
lockdown, of shutdown, of illness. What do people need to understand about the economy and the economics of what South Africa is going through at this
moment, in your mind?
BOONSTRA: Honestly, I'm not sure I'm the best person to speak about that. It's such a complicated, multilayered challenge that it isn't just COVID,
it isn't just the remains of apartheid, and it isn't just the anger over Zuma, but it's all these layers on top of each other. And interestingly,
for example, where we see that the taxi companies are fighting each other in Cape Town, they're actually the ones protecting communities and
protecting stores in Johannesburg.
So, very different organizations behave differently in different areas. And so a very complex society, South Africa, it surely is. Again, what I'd like
to emphasize is the resilience as well of the country. I have no doubt that, for example, small stores and local communities will work very hard
to help each other get back up and running.
I thought what we saw during the last lockdown is how community stepped up to help each other was incredible. So yes, it's both a very dangerous, very
tricky situation, as well as one that for me and the people that is -- there is a glimmer of hope -- that is in the people and their tremendous
power to make good things happen.
CHATTERLEY: Yes, you know, your emotional response and your heartfelt response makes you eminently qualified to respond to that question,
Jessica, and fingers crossed, you get back up and running.
Any sense of timing on that? Are you just going to wait and see as soon as it feels safe for your people, you'll get back up there and getting support
and food out to people?
BOONSTRA: Absolutely. A matter of days, literally days, no longer than that. And as mentioned, we are already reaching out to the communities and
making sure that we deliver whenever we can. We're opening area by area, so we're not open everywhere. But in many areas, we are already taking orders,
we're already delivering, so that's going to happen very, very soon.
CHATTERLEY: It's via WhatsApp, so I think the message is, just send a message and keep hoping and hopefully you'll be back up and running as you
say very, very soon.
Jessica, great to have you with us. Thank you
BOONSTRA: Absolutely.
CHATTERLEY: Jessica Boonstra there, founder and CEO of Yebo Fresh.
The market opens next. Stay with us.
(COMMERCIAL BREAK)
[09:31:14]
CHATTERLEY: Welcome back to FIRST MOVE. U.S. stocks are ready for business this Wednesday. Call it midweek momentum. The major averages moving higher
with tech at fresh records as investors shrug off a fresh round of hot inflation data. Fed Chair Jay Powell admitting in his prepared testimony
before Congress today that inflation has increased markedly, but he is not yet ready to signal a change in Fed policy.
So, inflation moving higher, so are pot stocks on fresh legalization hopes. U.S. Senate Majority Leader Chuck Schumer set to unveil a bill today that
would among other things, allow pot firms to access banking services.
And speaking of banks, shares of Citigroup, Bank of America, and Wells Fargo are mixed after reporting their second quarter results. Bank of
America revenues came in light as low interest rates pressured result, but Citigroup upbeat on further U.S. growth. It is releasing more than $1
billion that it set aside for bad loans during the worst of the pandemic, so following exactly what JPMorgan did yesterday as well. And that's the
performance there.
Now, we've been hearing in this hour already about the countries around the world currently in the grip of unrest or hit hard by the pandemic and all
lagging behind other nations when it comes to vaccination rates.
As CNN's Nic Robertson explains, some people are laying the blame firmly at the door of their governments.
(BEGIN VIDEOTAPE)
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR (voice over): From Cuba to Haiti, South Africa to Lebanon, tinder dry tensions are igniting
crippled economies burdened by COVID-19 are partly to blame.
In Cuba, angry citizens incensed by lack of food, medicine, and freedom, as well as spiraling coronavirus infections are getting beaten back by police
for demanding the ouster of President Miguel Diaz-Canel.
In a national broadcast, he blamed Cuba's economic woes on U.S. sanctions imposed under former President Donald Trump.
MIGUEL DIAZ-CANEL, CUBAN PRESIDENT (through translator): We explained to the Cuban people very clearly that we were about to enter a very rough
period of time.
ROBERTSON (voice over): Reality is, Cuba's weak economy and healthcare system is being brought to its knees by COVID-19 infections soaring, only a
little more than 16 percent of Cubans fully vaccinated.
The United States is watching with concern.
ANTONY BLINKEN, U.S. SECRETARY OF STATE: People deeply, deeply, deeply tired of the repression that has gone on for far too long, tired of the
mismanagement of the Cuban economy, tired of the lack of adequate food, and of course, an adequate response to the COVID pandemic.
ROBERTSON (voice over): Haiti also a concern for the U.S., the audacious assassination of President Jovenel Moise last week, top weeks of deadly
street protests and fighting, fueled by poverty and factional infighting.
The impoverished Caribbean nation, which has been an economic basket case for decades, saw street violence ramp up in recent weeks concurrent with a
spike in COVID-19 cases in late June.
In South Africa, where COVID-19 infections have been spiking, and vaccination rates are low, the economic inequalities are high. The Army has
been brought in to quell deadly rioting triggered by the jailing of former President Jacob Zuma on contempt of court charges.
And Lebanon, too, is having a crisis, exacerbating preexisting tensions of poor COVID readiness. Protests and anger ever present as rocketing
inflation, rolling power outages roil passions
The nation reeling from the economic impact of decades of Syrian Civil War next door, compounded by years of political infighting.
[09:35:19]
ROBERTSON: And to cap it all, a port last, last summer shredding much of Central Beirut.
And Iraq this week became the latest country where tinder dry frustrations combusted as they touch the nation's war and COVID weary population. Oxygen
tanks for treating COVID-19 patients at a hospital exploded, killing more than 90 people
Within hours, nearby residents took to the streets demanding better from their government.
Living with COVID-19 has become not just a way of life, but a salutary warning for leaders everywhere.
Nic Robertson, CNN, London.
(END VIDEOTAPE)
CHATTERLEY: A warning that the richest nations in the world have to get vaccines to poorer nations as soon as possible.
Coming up on FIRST MOVE, what made the REvil hackers retreat? We'll discuss with the CEO of cyber security firm, CrowdStrike. That's next.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE, and a return to one of our top stories this hour: the mysterious retreats of infamous cyber hackers REvil
from the internet.
The notorious group is or was just one part of a huge problem. There have been ransom demands for $164 million this year alone. That's according to
cybersecurity firm, CrowdStrike, which has been tracking ransomware attacks, among many other things.
Joining us now is George Kurtz. He is the CEO of CrowdStrike. George, fantastic to have you on the show, as always.
I've spoken to experts already in the last 24 hours who say there are three options here. The Russian government took them out, the U.S. government
took them out or they decided to hide simply due to the level of scrutiny they are under. What are your views on what happened?
GEORGE KURTZ, CEO, CROWDSTRIKE: Well, no doubt there's a high level of scrutiny. We've seen the impact they've had, we've seen the dollars raised
by them. And obviously ransomware is problematic for every company right now, every organization and, you know, it certainly could be that they take
themselves down and will reconstitute. They've done that in the past. They were part of a former group that reconstituted themselves as REvil.
[09:40:03]
KURTZ: But you also have to look at the political motivations behind this. Obviously, there's a tremendous amount of pressure from both the U.S.
government, and perhaps the Russian government to get this shut down, given the current conversations that each government is having with each other.
So, I think it remains to be seen. I'm surprised we haven't seen a real official announcement by any of those parties, but we'll wait and see.
CHATTERLEY: How easy is it for a nation state to deactivate cyber hackers like this? Because they were midway through negotiations with firms or
businesses that they had locked up data for? And obviously, were negotiating a ransom, and all of that infrastructure disappeared as well.
KURTZ: Well, that's part of the problem. If you're in the middle of negotiating with them, and their infrastructure is down and the shop is
closed up, you're pretty much out of luck of getting your data back.
It depends. Certainly governments have the capabilities to be able to disrupt their operations, and if they were asked by the Russian government,
they probably would comply.
CHATTERLEY: I mean, this could have happened after the Colonial Pipeline attack as well, why now?
KURTZ: Right now, I think there's just so much focus on this. We've seen that ransomware is more than just getting your computer infected. It
actually impacts the availability of businesses, the resiliency. And I can tell you right now, I speak to Boards on a weekly basis. This is the number
one issue that most audit committees are talking about at the Board level.
CHATTERLEY: I.E., if we get attacked, do we pay the ransom?
KURTZ: Yes, it's a big topic, if we get attacked -- well, first, do we have protections like CrowdStrike and others?
CHATTERLEY: That should be the first conversation.
KURTZ: Second -- exactly. Let's protect ourselves. But if we do get attacked, do we pay it? Do we not pay it? What are the implications?
Obviously, a lot of these groups are in sanctioned countries. There's implications in paying it, implications in having your data leaked, and it
is one thing to have your data encrypted, but what they're doing right now, which is really insidious, is they are stealing the data, then encrypting
it.
And you have a choice, you can either pay and get your data unencrypted, or if you don't pay and restore from backups, they will actually leak that
data on dedicated websites, which puts the company in an awkward and bad position.
CHATTERLEY: For me, the threats evolved in two ways, the acceleration of simply the number of attacks that we've seen, but also the sophistication
perhaps of the individuals that are carrying this out. I mean, you have got a term for it. You call it "big game hunting." What are we talking about
when you use the term "big game hunting"?
KURTZ: Yes, so big game hunting is really the focused effort by these e- crime actors to target an entire company and encrypt all of their data. And if we just look back to say, 2014, when we see CryptoLocker, that was a
prolific ransomware back then. That was a single machine that would get infected, you clicked on a link, it'd be $50.00 in Bitcoin, and it would be
an annoyance. But it wasn't your entire organization.
Well, the e-criminals have figured out that they can make much more money by actually getting into an organization almost using nation state tactics,
right, very stealthy, distributing all of the ransomware and then activating it at one time, causing maximum damage and obviously increasing
the ransom demands.
CHATTERLEY: I mean, the key the point that you made there, I think, is that nation state style actions that we're seeing, and suddenly, it's gone
from being an irritant for corporations, very potent at times, if it's data being leaked or data being taken and potentially leaked, to this point that
you're making, which is now these significantly-sized ransom.
I mean, the average size is just over $6 million, I believe, according to your data, but suddenly, it's become a national security threat at the
point where you're disrupting energy supplies, at the point where you're disrupting food supplies, you become a national security threat. And
perhaps that feeds into the timing. George, do you think that we saw here? Suddenly, nation states are saying, okay, we have a problem with these
individuals, real problems.
KURTZ: A real problem, exactly. Again, it goes past just being an annoyance and really impacting the critical availability of infrastructure.
And when that happens, you're certainly going to get government's attention. There's going to be conversations behind the scenes, and maybe
even action behind the scenes taken to bring these bad actors down.
CHATTERLEY: Gut feel, George, based on what you've seen from these guys, do they come back, even if it's in a different form?
KURTZ: They always come back. You know, it's Willie Sutton, you know, go with the money is. If they're gone entirely, which I doubt, they'll just be
replaced by someone else. That's just that big of a business, very low risk in getting caught and a lot of money to be made by these e-criminals.
CHATTERLEY: If it was a government that took them out here, be it the Russian government, the U.S. government or another government, for that
matter, should they be honest in some regard about what they did to try and create some kind of deterrent effect? Because that seems to be lacking in
all of this, whether it's the ransoms being paid or the inability, as you say, to end the whack-a-mole game with taking these guys down.
[09:45:06]
KURTZ: Well, it's interesting, because if it was the U.S. government, I would have expected some announcement around this, and it still may come,
it may not come, I don't know. But at the end of the day, if someone at the government level was responsible, I would have expected some level
announcement to create these lines that can't be crossed and to create the deterrent, as you say.
CHATTERLEY: But then potentially, they have had to have crossed boundaries with Russia.
KURTZ: Well, there's a lot of, you know, political implications behind this. But you know, the internet crosses boundaries every day. So, it's
just a matter of what --
CHATTERLEY: You're right. There are --
KURTZ: What are the norms of how we operate in the cyberspace world?
CHATTERLEY: Yes, and you protect your citizens. That's what you do.
KURTZ: Big time.
CHATTERLEY: George, great to have you with us. George Kurtz, the CEO of CrowdStrike, saying they will be back. Thanks for joining us.
All right, coming up on FIRST MOVE, Japan's fastest man tell CNN about his lifelong race for Olympic glory.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE, and on the countdown to Expo 2020 in Dubai in October, it's going to showcase some of the brightest ideas
that have evolved in the fight against COVID-19. Eleni Giokos looks at two projects making a difference to everyday lives.
(BEGIN VIDEOTAPE)
ELENI GIOKOS, CNN BUSINESS AFRICA CORRESPONDENT (voice over): From improving hand hygiene in Ghana, to maintaining social distancing in
Belgium, COVID-19 has posed many unique challenges
And this village Project Maji, a social enterprise has been providing solar-powered filtered water to communities since 2015. Despite water being
a finite resource, they recognized the importance of hand washing in preventing the spread of coronavirus, and began educating communities on
hand hygiene and developed a safe, simple, and low cost invention to help them do it.
SUNIL LALVANI, CEO AND FOUNDER, PROJECT MAJI: What we have come up with is a hand washing station where we have eliminated the single biggest weakness
of a traditional hand washing station, which is closing the tap after you've washed your hands manually.
So, we came up with a foot-operated station, which is so easy to make and maintained by villagers.
GIOKOS (voice over): More than 750 hand washing stations called Maji buckets and a soap distribution campaign have been deployed to 90
communities across Ghana impacting, according to Project Maji, the lives of some 75,000 people.
[09:50:10]
GIOKOS (voice over): In this workplace in Antwerp, maintaining social distancing posed its own challenge. At Atlas Copco, a compressor
manufacturer, keeping its 3,000 workers safe was a top priority.
BART BATES, GLOBAL OPERATIONS COORDINATOR, ATLAS COPCO: The most important of course, was making sure we kept our distance of 1.5 meters at all times
to work in a safe way.
GIOKOS (voice over): They turned to Belgian firm, Lopos, who design safe distance, a wearable device that uses alarms, lights, and vibrations to
warn when social distancing is not being respected.
PETER VAN ROOSBROECK, CHIEF COMMERCIAL OFFICER, LOPOS: I think the most important thing is that we provide any technology that is configurable even
when government regulations change, and it's not 1.5 but maybe two meters or 1.3. Then all of our clients can just configure the technology and
continue to use it.
GIOKOS (voice over): Lopos says, it has dispatched 25,000 devices so far. Now, those behind safe distance and Maji buckets are among a number of
projects chosen by Expo 2020's Global Best Practice Program that will get a chance to showcase their innovations during the six-month event from
October.
Eleni Giokos, CNN, Dubai.
(END VIDEOTAPE)
CHATTERLEY: And another countdown now, nine days remain until the Tokyo Olympics. As those Summer Games fast approach, there is of course, a
mixture of both excitement, but also apprehension as Japan's COVID cases rise.
CNN's Blake Essig has the latest on the games and he speaks to Japan's fastest man about his long race to the Olympics.
(BEGIN VIDEOTAPE)
BLAKE ESSIG, CNN CORRESPONDENT: With a little more than a week to go before the Olympics, athletes continue to arrive, the Olympic Village is
open and there's now little doubt that these Olympic Games will go ahead.
In fact, IOC President Thomas Bach said so Tuesday during an online interview with local media news outlet, Kyodo News. Now despite that
reality, these Games still remain deeply unpopular, especially with Tokyo now under its fourth state of emergency order.
With cases surging in the capital, the ongoing health and safety concerns aren't just affecting the public, they are also weighing heavily on
athletes including Japan's fastest man.
ESSIG (voice over): Ryota Yamagata has himself a set of wheels. Not literally, of course, but man, this guy can move.
As a kid, Yamagata was always fast, choosing to race against machines with actual wheels is motivation.
RYOTA YAMAGATA, JAPAN OLYMPIC TEAM CAPTAIN AND SPRINTER (through translator): Your body moves faster when you feel like you're being
chased. So, I trained by pretending to run away from cars.
ESSIG (voice over): It's a mentality he still carries today, one that's driven him to qualify for his third Olympics, where he'll run in the 100
meters and men's 100 meter relay, being named captain of Japan's Olympic team and claim the title of Japan's fastest man.
YAMAGATA (through translator): It was a long road until I got my personal best and ran under 10 seconds.
ESSIG (voice over): A long world littered with injuries and a little bit of luck.
ESSIG (on camera): In 2019, you suffered a collapsed lung and leg pain; last year, it was your right knee. Had the Olympics not been delayed a
year, it's possible you wouldn't have qualified.
YAMAGATA (through translator): I wanted to believe that I'd make it to the Olympics, but my body wasn't able to keep up with my mind. I did think back
then that if the Olympics had been held that year, I probably wouldn't have qualified,
ESSIG (voice over): But Tokyo 2020 was postponed and Yamagata made the most of it. He recovered from injury, made changes to his training routine
and is now peaking at just the right time.
ESSIG (on camera): While Yamagata remains focused, he says the controversy surrounding these Games fueled by health and safety concerns has been tough
to deal with.
YAMAGATA (voice over): This is a challenging time, and there's a part of me that feels the pressure. But I hope that doing our best to these
Olympics is our way of helping the world become slightly brighter.
I think there is value in sports, and I'm trying to find a meaning in my running and stick to that.
ESSIG (voice over): New meaning and perhaps, a new perspective after years of uncertainty.
YAMAGATA (through translator): It's been a really tough road getting to the Tokyo Olympics, and I overcame a lot of challenges, but I want to
achieve my goals and give it my best shot.
ESSIG (voice over): That goal is to win gold and proudly represent Japan right here at home.
ESSIG (on camera): Although COVID-19 cases in the capital are surging, Olympic organizers maintain that through a strict set of COVID-19
countermeasures that they will be able to hold a safe and secure Olympic Games.
For months, organizers have kept an upbeat tone in an effort to generate excitement and cement a positive legacy for these games. But to this point,
based on a continued lack of public support, it's clear that that effort is failing.
Blake Essig, CNN, Tokyo.
(END VIDEOTAPE)
CHATTERLEY: And finally, on FIRST MOVE, he is an officer and a gentleman, and he made someone very happy this Bastille Day.
[09:55:00]
CHATTERLEY: This French trainee soldier made the ultimate salute to love by proposing to his partner. He got down on one knee on the Champs-Elysees
just moments before he took part in the Bastille Day Military Parade in Paris. Very sweet and congratulations to them both.
We love had a little bit of love here on FIRST MOVE.
That's it for the show. If you've missed in our interviews today, they will be on my Twitter and Instagram page, search for @jchatterleyCNN.
In the meantime, stay safe. "Connect the World" with Becky Anderson is next, and I'll see you tomorrow, as always.
(COMMERCIAL BREAK)
[10:00:00]
END
