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First Move with Julia Chatterley
Major Dam in Southern Ukraine Destroyed; Ives: This is the First Step in a Broader Strategy; NIKKEI Trading at its Best Levels in Decades; Ukraine Economy Minister Blames Russia for Collapse of Dam; United CEO: Sustainable Fuel key to Climate Goal; Starbucks Rolls Out Oleato in More U.S. Cities. Aired 9-10a ET
Aired June 06, 2023 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:00]
RAHEL SOLOMON, CNN HOST: Welcome to "First Move". I'm Rahel Solomon in today for Julia Chatterley. And just ahead on today's show Moscow and Kyiv
trading blame for the destruction of a large dam in Russian held Southern Ukraine with hundreds forced to evacuate due to flooding and new fears over
Ukraine's massive nuclear power plant with the very latest just ahead.
Plus Prince Harry versus the tabloids, the Duke of Sussex testifying against the "Mirror Newspaper Group" in London's High Court, accusing
reporters of phone hacking and illegal surveillance.
And VisionPRO ready to go Apple unveiling the long awaited mixed reality headset. Its first major product launch and yours many calling it the dawn
of a new computing age. But what about that hefty price tag we will discuss with tech investor Dan Ives.
And turning to the global markets U.S. futures a bit weaker after Monday's modest pullback the S&P 500 coming very close to finishing the day in bull
market territory or 20 percent rise from recent lows. Europe trading mostly lowers as well. And mostly downbeat close in Asia the Australian Central
Bank, surprising investors with an unexpected quarter of a percent rate hikes that drag the market lower.
And China reports say that Beijing is asking its big banks to cut deposit rates to try to jumpstart growth. Meantime the Ukraine dam collapse
impacting commodity markets the price of wheat currently up more than 2 percent on fears that flooding in the region will affect supply.
And let's get the latest from Ukraine now. That's where we begin the show. It's not clear at this moment what caused the destruction of the dam in the
Russian controlled area. Ukraine claims that the Russian military blew up the dam and "Panic".
But the Kremlin says it was a sabotage attack by Ukrainian forces. Downstream people are getting out of their homes as floodwaters rise. A
reservoir upstream from the dam supplies water for the Zaporizhzhia nuclear plant. The UN nuclear watchdog IAEA says there's no immediate threat to the
plant.
But of course, lots more watch here. So let's bring in Clare Sebastian. She joins us now. So Clare, what more do we know about the cause of the attack
because as I said, Kyiv blames Moscow. Moscow blames Kyiv what more can you tell us?
CLARE SEBASTIAN, CNN CORRESPONDENT: We just don't know at this point Rahel. They're still assessing the damage both sides as you say very firmly
placing the blame on each other. Dmitry Peskov, the Kremlin Spokesman said just a little earlier that this was done by Ukraine, because as he said,
having launched their large scale offensive two days ago, of course, that hasn't been confirmed by Ukraine.
Now the Ukrainian Armed Forces are not achieving their goals. It also accused them of trying to choke off the water to Crimea, because of course,
that reservoir just upstream of the dam supplies water to the Crimean peninsula.
The Ukrainians though are of course, saying this is a terrorist attack by Russia, the Foreign Minister calling this deliberate and long planned and
the Head of the Presidential Administration saying this is Ecocide a reference to the potential environmental damage of this.
What we do know for sure, is that the flooding is now increasingly widespread. We understand the water levels are still rising, the Ukrainian
Interior Minister just in the last hour or so saying 24 settlements are flooded, they have evacuated over 1000 people. And we know that evacuations
are happening on the Russian side as well.
This is a dam that straddles the Dnieper River, which in itself is basically the front line in this conflict, Russian controlled territory to
one side Ukrainian controlled territory to the other. So it is very much on the front line here. And both sides are affected by this flooding.
SOLOMON: Clare is Ukraine saying what Russia stands to benefit from allegedly doing this?
SEBASTIAN: So they, as you said, I have said that Russia did this in panic, perhaps about their imminent counter offensive, but they are not being
particularly explicit in that Russia, as I say, did the Kremlin Spokesman did reference the counter offensive saying that it's not going well. And
this is why Ukraine allegedly did this.
The Head of the Joint Forces of the Ukrainian Army, though did reference the counter offensive as well and said, look, this isn't going to affect
us, because we are already essentially modeled for Russia doing something like this back in the autumn.
President Zelenskyy himself had said that Russia had mined the dam and might be considering blowing it up. So it was already something that they
were looking at with some concern. I think if you look at the map of where this is, you could potentially say that it might complicate the any
Ukrainian effort to cross that Dnieper River, potentially towards Crimea, or the Sea of Azov.
It might take attention away from other areas of the frontline where we know that attacks have been intensifying. But as of now, Ukraine is saying
that it's not going to affect their plans.
SOLOMON: A lot more to come here. Clare Sebastian, great to have you on this thank you! And later in the show, we will actually hear the view of
Ukraine's Minister when I speak with that person in a bit. Meantime there are tabloid newspapers in Britain with blood on their hands.
[09:05:00]
That's the dramatic claim from Prince Harry in the High Court in London. The Duke of Sussex giving evidence in his lawsuit against the "Mirror
Group" of newspapers, which he accuses a phone hacking. Nada Bashir is following the story. Let's join her now outside the court. Nada good
morning so this is a very personal issue for Prince Harry and also becoming quite tense in court.
NADA BASHIR, CNN CORRESPONDENT: Yes, absolutely. He's been extremely vocal about the media's intrusion in his personal life. He's spoken about it in
his memoir in his Netflix Docu series and other press interviews. But of course, this is a very different environment. He is now facing the cross
examination by defense lawyers in the courtroom behind me.
Now Prince Harry has given his witness statement a 50 page document detailing the impact the British tabloids under "Mirror Newspaper Group"
have had on his life for those that have those around him. He spoken about the details revealed in media publications, including of course, the
tabloids, which he says should the telltale signs of unlawful information gathering.
We're talking about phone hacking about the interception of Prince Harry's voicemails and the voicemails of those around him as well as the use of
private investigators to glean information not only about his life, but that of his late mother, Princess Diana.
Now he's gone into detail around the impact this has had he said it caused him to feel a huge amount of paranoia growing up it caused his circle of
friends to become smaller and smaller and also caused him to suffer from bouts of depression.
And he's spoken about the details that have been revealed in some of these articles. A number of them have been submitted as part of his claim by his
lawyers, including private intimate details around conversations he had with his brother William, the Prince of Wales in the past, as well as the
ups and downs of his past relationship with former girlfriend Chelsy Davy.
Details which he said eventually led to the breakdown of their relationship. He's spoken of course very recently about how this has
impacted his family including his wife, Meghan Markle, the Duchess of Sussex and children.
It was a big reason as to why they chose to withdraw from their positions as senior members of the Royal Family and to relocate their family from the
United Kingdom to California. But this is a deeply personal matter for the Prince.
He says that he wants to hold those responsible to account to transform the media landscape here in Britain, particularly, of course, over the death of
his mother, which he's feels was deeply influenced and impacted by the tabloids, who have been, of course highly interested in the ins and outs of
the British Royal Family's life Rahel.
SOLOMON: Nada Bashir live for us in London, Nada thank you. And across France, demonstrators are taking to the streets once again for the 14th day
of protests over controversial pension reforms. Take a look.
These were the scenes in France earlier today. But now one of the country's main union leaders says that today's protests could be "One of the last".
Let's get the latest now with CNN Paris Correspondent Melissa Bell. Melissa, you've been covering these protests help me understand from the
ground what you're seeing and how this compares, perhaps, to some of the other protests that you've brought us.
MELISSA BELL, CNN PARIS CORRESPONDENT: Exactly Rahel what we're seeing so far lower numbers than we've seen, really, any of the protests so far. This
is the very front of the protest right here. You can see the substantial police presence there at the helm of the march, trying to make sure that
there aren't the sorts of scenes of disorder that we've seen so much over the course of the last few months.
And yet, even if the numbers are down Rahel, authorities say that they expect about 1000 more radical protesters to be taking part today getting
about 2 to 300 far left demonstrators. So they're not expecting this to go entirely through they already had a couple of bursts of tear gas.
But certainly lower numbers than we've seen before, partly because essentially, this report will get you in there's very little they can do
about it. Even the verge on Thursday in the bottom is essentially made by the government. This -- noise and this union says it's probably the last
burst of anger that they will organize ahead of this stop Rahel.
SOLOMON: Melissa Bell live for us in Paris covering it all. And among the protesters in France air traffic controllers the CEO of Air France discuss
the issue in an interview with our Richard Quest.
(BEGIN VIDEO CLIP)
BENJAMIN SMITH, CEO, AIR FRANCE-KLM: The French air traffic controllers strike we don't support whether a high altitude or whether it's a takeoff
and landing off the -- off the, you know, in the French region. I mean, this is -- this has been a real challenge for us for the last five months.
So our belief is these needs to reduce and these needs to stop.
[09:10:00]
There are some laws in France that are probably going to be introduced toward the air traffic controller that are not in place today, which will
help us react. But it's, you know, some days we have to reduce up to 30 percent of our flights in Paris at no notice. It's been a challenge ever
since this, this retirement reform has come in.
We've been -- we've managed our staff quite well. We have not internally been affected by -- we've seen across the country, especially in
transportation when it comes to strike.
RICHARD QUEST, CNN HOST: Will you tend to take a stand?
SMITH: On that particular issue? I'm OK with it. You know, it was very well thought through a lot of debate, a lot of debate a lot of exemptions we're
OK. I want to talk specifically about our company. I think it's in terms of what we've got in place for our pilots and our cabin crew and our ground
staff.
We've got enough protection that the impact is quite minimal in other industries. I mean, I don't know the details of it and how much it impacts
but to say make a statement about our company and how it's impacted. You know, we think it's, it's not bad. The -- no, I'm not French or Dutch. But
when I look at what we have in the Netherlands, and we have another countries it seems quite reasonable.
(END VIDEO CLIP)
SOLOMON: Meantime Apple has unveiled the tech of tomorrow at its conference and its California Headquarters. Take a look. This is the Apple VisionPRO.
It's a mixed reality headset with the hefty price tag of $3,500. The company says it should be available early next year. And CNN's Jon Sarlin
has the details on what exactly you're getting with the new hardware.
(BEGIN VIDEOTAPE)
JON SARLIN, CNN CORRESPONDENT (on camera): A big day here in Cupertino, California where Tim Cook and Apple have unveiled Apple's biggest new
device since the Apple Watch in 2015. VisionPRO a mixed reality headset sits atop your head like a ski goggle.
Now you might know a virtual reality a full screen that blocks everything out. This is mixed reality a combination of the real world and the virtual
world overlaid on one another that Apple is banking on being the future of computing.
Now, what does it do? That is the big question. Apple showed a video which had a desk with different workstations with different screens that you can
adjust. They showed a home cinema with a TV screen as big as you want. But the big question though, is will people spend $3,500 on it especially when
its closest competitor Metis Oculus is only around $300.
Well, Tim Cook and Apple say that they've cracked the code on a device they're calling historic. There'll be available in stores early next year
Jon Sarlin, CNN, Cupertino California.
(END VIDEOTAPE)
SOLOMON: And joining me now on the latest is Dan Ives. He is the Managing Director and Senior Equity Analyst at Wedbush Securities. Dan, good
morning! Welcome to the program. So this is the first time in years really that Apple has launched a new product like this. I know you were bullish
broadly on Apple. Are you bullish on this product too?
DAN IVES, MANAGING DIRECTOR OF EQUITY RESEARCH, WEDBUSH SECURITIES: Look, I believe it's revolutionary in terms of what this does laying out. I think
the next decade of growth for Apple on the Metaverse and on the AI strategy. And that's really what Cook's doing here. Rahel this is about the
golden install base of Cupertino. And they're going after developer's front and center.
SOLOMON: But Dan, are you concerned about how it looks? I mean, it has been described by at least critics, some analysts, journalists as sort of
awkward looking not cool. When you think about Apple and the brand you think sleek design, you think cool. Are you concerned about the way this
looks?
IVES: Look, I think ultimately they've had the golden touch. Perfection is what comes out of Cupertino. And I think what this has done a really makes
what Meta has done almost table stakes, you know, relative to technology. And I think this is just the first iteration on a much broader strategy
that Apple is laying out.
Further penetration of us developers have consumers and I believe two, three years from now, this is a 1500 hour device. You know, right now,
obviously, you're not going to see mass adoption coming out of the gates. This is really just the first step in a much broader strategy coming at
Cupertino.
SOLOMON: And so you mentioned Meta. I wonder because you pointed out in your research note, you admitted that Meta's Oculus headset, the success
there has been more tepid. Why then do you think that Apple's VisionPRO would have a different outcome?
IVES: Because ultimately, I mean, they're the LeBron James Michael Jordan of hardware. I mean, if you look at what Apple comes out with, you have 2
billion iOS devices worldwide. And there's about that penetration. I mean, go back to air pods, coming out that they thought it would be a fantasy the
skeptics that they'd sell maybe five 10 million units.
[09:15:00]
Two years later, they sell 100 million units in a year. I think it just speaks to what they're able to come out with into their ecosystem. And I
think this is almost magical from a technology perspective, probably the biggest innovation we've seen in the last decade far should the -- I think
this is really weighing out what could be the inflection point Apple's growth.
SOLOMON: Dan, I take your point that Apple is similar to LeBron James. But of course, as you know, when if this NBA season is any indication,
sometimes even LeBron James missed it. So could this be a miss?
IVES: And they -- and just like what -- they missed on on-pod. I mean, they miss when it came to that. But overall, the reason that they just continue
to really be on parallel in terms of the installers in terms of what they've done, despite the macro is that they understand their developers
and consumer base when to ultimately release the products at what time?
And I think this is really laying the groundwork for what's going to be a broader AI strategy within the app store. And I think that's really some of
the breadcrumbs that Cook and really the team are laying out in Cupertino.
SOLOMON: And Dan, that's a perfect segue because obviously, you follow this space, certainly much more closely than I do, but much more closely than
most. Where is Apple on AI because I think about just some of the chatter and some of the news and it's a lot of ChatGPT but where is Apple on the
whole artificial intelligence space?
IVES: Yes, right now, I mean, in this game of thrones, the winners clearly Microsoft Nvidia and obviously fall by Google. But Apple, it's all about
the ecosystem. They're now going to start to really lay out for developers to build AI driven apps use cases within the app store.
And that's going to ultimately look. We think are some of the parts this could ultimately add 30 to 48 hours per share to Apple, but that's the way
Cupertino does it close to the best. They're not the first one out, but it just is why they're on the verge again of 3 trillion market cap because
they continue to sort of be the gold standard and tack.
SOLOMON: And then Dan Ives, beyond just the VisionPRO what are you looking ahead in terms of product launches? What are you most excited about moving
forward over the next 12 months or so?
IVES: Yes, right now it's a drumroll to what I view is almost a mini super- cycle. iPhone 15 Anniversary Edition comes out this fall. 250 million have not upgraded their iPhones in four years. I think that's why we're going in
to what's going to be just a massive release cycle for Apple despite the Mac on everything we see come out or at least supply chain checks being an
age of the last few weeks pretty bullish despite a macro that's not roses and rainbows.
And I think that's why coming to the show many bet against Apple, but yet again, I think you know they're showing no why they're the gold standard
top of that mountain.
SOLOMON: We shall see Dan, sometimes even the mighty have misses. So we shall certainly see but that is Dan Ives, Managing Director and Senior
Equity Analyst at Wedbush Securities Wedbush by the way having an outperform on Apple with a 205 price target. Thanks for joining me from
Westfield, New Jersey always good to see you, Dan.
All right, coming up on "First Move", Japanese stocks trading the highest levels in decades what's behind the rally. Plus the impact of today's
destruction of a critical dam Ukraine's Minister of Economy joins me next.
(COMMERCIAL BREAK)
[09:20:00]
SOLOMON: Welcome back to "First Move". Japanese stocks finishing Tuesday's session up by almost 1 percent the NIKKEI riding a four day winning streak
it is up by almost 25 percent since early January, also trading at its highest levels in decades.
The NIKKEI's rally so far this year is posted an assets 26 percent advance. Big turnarounds from the NIKKEI's almost 10 percent drop in 2022. Famed
Investor Warren Buffett helping contribute to the bullish mood with more to explain now Marc Stewart, who joins me from Tokyo. So Marc 25 percent, 26
percent year-to-date pretty impressive what's behind the rally?
MARC STEWART, CNN CORRESPONDENT: And it's outperforming the S&P 500 just had to mention that as well Rahel. Alright, so as you know, from covering
markets, there's not usually just one factor. There are many things at play.
First of all, let's just talk about opportunity. Right now, the Japanese Yen is weak, the American dollar, for example, it goes very far here in
Japan. So that's one reason why traders may be attracted to the NIKKEI. They feel like its good value for their money, and it can be a potentially
good opportunity.
The second reason you mentioned Warren Buffett. It's this whole concept of endorsement. Warren Buffett has been spending some time in Japan. He likes
what he sees. He's impressed with the business community the way they operate. And that goes a long way. Warren Buffett's word carries a lot of
weight. I want to play part of a conversation I had earlier today with an economist right here in Tokyo, take a listen.
(BEGIN VIDEO CLIP)
RODRIGO GONZALES, ECONOMIST, INTELLIGENCE CORPORATE NETWORK: What he said was that when you invest in a company, you think about investments where in
20 years, 30 years, that's going to still be a business. So if you think about Japan, there are about 5500 companies worldwide older than 200 years,
more than half of those are here in Japan so it's a solid place to park your money.
(END VIDEO CLIP)
STEWART: All right. So there is some stability here. And along those themes if you look at other markets across Asia, let's just focus on China because
that's obviously a big point of investment. Right now for new investment there's a bit of turbulence and it is viewed that perhaps the more stable
waters of Japan are more attractive right now within China. But Rahel, as we both know very well, these markets are fickle, and things can change
very, very quickly.
SOLOMON: Well, they sure can and Marc, I understand that the monetary policy environment is different in Japan, certainly than the U.S. and many
other places in the world right now. But in terms of larger macro concerns that have seemed to plague the markets for quite some time now. Walk me
through the sentiment there in Japan. Is that not the case? Those sorts of macro concerns that we're all sort of, you know, dealing with right now?
STEWART: Well, a lot of times we hear that the stock market is not the broader economy. And let's face it; there are some real challenges here in
Japan. For example, we have an aging population that impacts productivity that impacts output, that impacts the greater economic health, inflation,
while not nearly as bad as other parts of the world.
That's a big challenge as well. Companies here too there are also in a bit of a, let's say, theme of transition. They realize the importance of bigger
dividends. They realize that some of the business practices the West are worth replicating so they're starting to do that. But broadly speaking
Japan's economy it's not without challenges, of course not.
SOLOMON: And we've also seen some of the major corporations they're also start to, you know, offer pay increases for its employees so a lot to watch
in Japan. Marc Stewart, great to see you thank you! And we have more "First Move" after the break.
(COMMERCIAL BREAK)
[09:25:00]
SOLOMON: Welcome back. And back to our top story now; a major dam collapsing in Southern Ukraine, Kyiv claims the Russian military blew up
the dam "In Panic" but the Kremlin says it was sabotage by Ukrainian forces. Downstream people are getting out of their homes as floodwaters
there rise. A reservoir upstream from the dam supplies water for the Zaporizhzhia Nuclear Power Plant.
Now the UN Nuclear Watchdog IAEA says there is no immediate threat to the plant but of course something to watch here. Sam Kiley joins me now. So
Sam, as we said both sides clearly blaming the other what more do we know?
SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, we know it also Rahel could have been structural failure again, that would be the
responsibility of the Russians who were in occupation of the dam. There are satellite images that show a breach in the dam a few days ago.
And that may just have been widened and caused this collapse. But of course it could also have been destroyed by one or other side. I think the
evidence will emerge on that later on. But what I can tell you very dramatically now Rahel is that I've been in touch with Ukrainian in a
position to know Ukrainian source on the ground with capability, shall we say, to monitor the Russian positions.
And this source is saying that they have seen Russian soldiers washed away their trenches inundated Russian soldiers accommodation knocked over and
inundated and Rusian soldiers abandoning their equipment on the east side of the banks of the Dnieper.
Because that is the area where very large numbers of Russian forces at least up until very recently, have been based constantly shelling and
harassing civilian and military targets just across the river including among their targets the City of Kherson, which of course, is now also being
inundated among 80 settlements that are being affected by this flood.
[09:30:00]
Many thousands, 16,000 people, according to the Ukrainian authorities on their side of the bank likely to be affected, but the greater amount of
effect from this flooding is in the Russian controlled territory.
This is still Ukraine, this is occupied Ukrainian territory. But the very large number of Russian forces had in the past been gathered in that
location. And if they weren't moved out in advance of this breach, then they would inevitably be those who are most dramatically affected by this
massive amount of flooding that has been unleashed by the breaking of this damn, Rahel.
SOLOMON: Well, Sam, I want to circle back to something you just said that when you said that Russian equipment appears to be flooded away or trenches
appear to be flooded, raising questions about what Russia stands to gain, if in fact, it was responsible for this. Help me understand what Ukraine is
saying in terms of why Russia would do this?
KILEY: Well, the Russian sorry, the Ukrainians are saying the Russians did this in what they say was a panic, to make it harder in the event that the
Ukrainians would choose to do so to cross the Dnieper River as part of what is anticipated to be the much vaunted offensive that we are seeing the
early stages of elsewhere in the country and indeed inside Russian territory.
This is the Ukrainian offensive. So essentially, the Ukrainian argument is the Russians did this to slow them down. The Ukrainian counter argument
coming from none other than the Ukrainian Ministry of Defense is that oh no, we saw this coming. We've made plans. It wouldn't slow us down. It has
nothing to do. It will have no military effect on us at all, Rahel.
SOLOMON: Sam Kiley, live for us from Kharkiv. Sam, thank you. What are now bringing Yulia Svyrydenko, the economy Ukrainian Economy Minister joining
us now? Yulia thanks for being with us.
YULIA SVYRYDENKO, UKRAINIAN MINSTER OF ECONOMY: Yes.
SOLOMON: As you just heard our Correspondent laid out there, both sides clearly pointing the blame at the other key. Help me understand what
evidence Ukraine has that makes you believe that this was Russia deliberately.
SVYRYDENKO: We actually were absolutely believed that it was made by Russians, and to destroy them actually say it's impossible by some external
shelling. As we heard that some Russian said that it was made by these external shelling -- that it was detonated.
And if you remember, last year, for the first time they announced that it would be detonated, and that this announcement goes from the Russian side.
That's why we're absolutely sure that it was made by Russians. And the Dam of Kakhovka was stationed there was detonated by Russian at approximately
2:50 at night.
So and now, as you have heard that the 80 settlements right now or now in a flood zone. And what we're trying to do right now, it's to adequate people
as quickly as it possible.
SOLOMON: So to be clear, you don't believe the theory that this could have just been structural damage, although this is still under the control of
Russia that this could have just been structural damage here, or structural failure?
SVYRYDENKO: No, we absolutely sure that it's not a structural damage you absolutely sure that it was done by Russian side. And it's a biggest
manmade disaster that they made. And it's a violation of the international law. And I think these damages, it was used and this explosive.
And this detention was used as a psychological weapon, then, that's why we've sold the show that it is kind of ecological going outside that was
made by Russians.
SOLOMON: In terms of your biggest concern now, as we've been reporting, people have been evacuated both Russian and Ukrainian. What is your biggest
concern right now on the ground?
SVYRYDENKO: So we tried to educate people as soon as possible. And we also in parallel, we're trying to provide water and try trying to find a way how
to provide water, people that left their homes and what we're trying to do and of course, you know, Ukraine, are fighting different fronts on the
economic front and military front.
And, you know, this region is an industrial region, and it's very important for us as well, for industry to keep going and when understand that if the
consequences of this disaster might be the fact that industry will fully stopped, because we are fully focused on people.
We're trying to save water for people not for running their enterprises. So that's why our main concern that Russian should pay for this disaster they
should pay for this get aside.
[09:35:00]
And this is the main I think my request to the National Society to pay one attention once again and to understand that what they're trying to do, it's
to the Russia tried to prove they're proved once again, that this is an all the time existence threats for Ukraine and for international society. So
but now we're fully focused on the evacuations.
SOLOMON: In terms of the power plan, as we said earlier, the IAEA has said that it won't cause any immediate issues, but how concerned are you about
future damage?
SVYRYDENKO: We're really concerned about future damage and where we're going to absorb on that situation. And today, our Prime Minister and
President all apply to international society to provide us the most rents in supervision all of these objects as we think it might be also, threats
from the rational side, when they -- act like, honestly, they act like a terroristic state, and no one can predict their actions.
And that's why we're, you know, ask you also to have the small talk with you, as we would like to say that there are huge losses of our economy,
there are future losses, in sense of people. So that's why what we need to do is just to strengths, your support, and not to afraid Russia, and to
keep fighting together with Ukraine.
SOLOMON: And earlier in the show, we saw the impact already to some of the commodity markets. Help me understand in terms of the economic impact of
what we've seen with the dam, what you're watching?
SVYRYDENKO: So for economic, I think that it's around 1 billion U.S. dollar for potential losses to transport and social infrastructure. Also, we
estimate 500 million U.S. dollar like direct losses for now. So river ports and shipwreck damages for $120 million dollars.
Also, we now estimate that there are also schools, and there are damages of the school, at least the 100 million but of course it is we will be ready
to finalize all this numbers. I think in a few days, of course, electricity generation losses for 1 million a year. So that's 100 million.
So that's why I think that in a few days, we will be ready to estimate all losses that we have in economic sense.
SOLOMON: Yulia Svyrydenko, we appreciate the time today. We know it is a tough day for your nation. We appreciate you being here. She is the
Ukrainian Economy Minister. Coming up on "First Move", ambitious goals to reach net zero emissions in less than 30 years, how some of the major
airplanes and airlines rather are planning to hit that target. We will take you to this year's IATA meeting, coming up next.
(COMMERCIAL BREAK)
[09:40:00]
SOLOMON: Welcome back to "First Move", U.S. stocks up and running this Tuesday. All the major averages are lower in early trading, you'll see the
DOW, NASDAQ and S&P all off let's call it about two tenths of a percent the NASDAQ off about three tenths of a percent, Tech stocks leading the decline
that's after Monday's across the board weakness.
But take a look at oil stocks. They're actually pulling back again and this is despite Saudi Arabia's surprise production cut over the weekend. I think
we can pull up oil stocks for you can see how WTI and Brent are doing well. They're pulling back Apple meantime also in the news today shares of the
tech giant losing a bit of ground after hitting an intraday record high on Monday.
Perhaps a sell on the news reaction after the unveiling of its new mixed reality headset on Monday also shares of Coinbase down sharply the U.S.
Securities and Exchange Commission the SEC announcing about an hour ago that it is suing the company and take a look at that shows are off about 18
percent, 17.5 percent.
Officials are charging Coinbase with operating as an unregistered exchange and broker. We will have much more on this developing story a little later
in the program. But major U.S. airlines they're actually bouncing back from the pandemic with share prices flying united is up 30 percent so far this
year.
And delta and American Airlines have gained about 15 percent each. The airlines trade body the International Air Transport Association is holding
its annual meeting in Istanbul right now. And it's announced a roadmap to reach net zero carbon emissions by 2050.
But in an interview with Richard Quest, the CEO of Qatar Airways says that he doesn't believe the industry will achieve that goal. Listen.
(BEGIN VIDEOTAPE)
AKBAR AL BAKER, CEO OF QATAR AIRWAYS: I'm one of the only CEOs I think that have been very frank that we will not be able to achieve the target SAF the
volumes you need, will not be available and coincidentally and the Qatar Economic Forum. The boss of Boeing did say that anything will not happen
till after the middle of the current century. So it was right. We won't be able to achieve let us not fool ourselves.
QUEST: The whole industry is predicated is just frothing about this idea of net zero by 2050.
BAKER: We will not even reach the targets we have for 2030, I assure you because there is no enough raw material to get the volumes of SAF. I've
spoken to I don't not to mention the oil companies. And they said that the volume they need is not available. This is why not enough volume of SAF is
being produced.
You know, you cannot only produce SAF in United States and you know, cater for the U.S. carriers. We are talking about the global net zero emission by
2050 is not only one region, and it's not available. And what we are trying to do is for PR exercise, saying that it will happen and it will be done.
It will be achieved, but it won't be able to be achieved. And the governments will use this to line their pockets by putting levies.
QUEST: You're a bit like, you know, the boy and the Emperor's New Clothes standing there, when the Emperor goes past and say the Emperor's naked,
you're sort of saying what nobody really wants to hear, which is that it can't be done.
BAKER: I'm not saying it can't be done, but to do it in the timeframe. The industry is far behind.
(END VIDEOTAPE)
SOLOMON: Well, that'd be United Airlines disagrees, saying air carriers can deliver net zero by 2050. According to Scott Kirby getting there requires
an industry to be built to supply sustainable aviation fuel.
(BEGIN VIDEOTAPE)
SCOTT KIRBY, CEO OF UNITED AIRLINES: Many of my counterparts here at this meeting will complain about you know, it doesn't exist yet. Like what I am
supposed to do? And my point to them, and what United is doing is we have to make the investments in the companies that are going to build and create
this. We can't count on someone else to do it for us.
[09:45:00]
QUEST: Even government, you can't count on -- ?
KIRBY: Well, we need government have to have government support and so in the United States the Inflation Reduction Act I think the sustainability
provisions are some of the most impactful legislation that have passed in decades. And that creates the foundation that this industry can be built
on.
QUEST: The rest of the world is frothing about the industry Inflation Reduction Act.
KIRBY: Yes.
QUEST: I'm trying to work out how to respond in a sense.
KIRBY: Yes.
QUEST: But even if you get all of that.
KIRBY: Yes.
QUEST: I suggest you can't hit net zero by the dates and targets, because you can't generate enough SAF. Even if he gets the SAF you can't reduce the
carbon because of the growth that has to be more drastic action.
KIRBY: You're wrong, is the answer. We can get there, 30 years ago, when did so, everyone said it can never compete with coal or net gas, it will
never be economic. Today, it's cheaper. This is going to work. But it had to have the right government framework or liberal or closer, we're not
there yet. But if the government framework makes it competitive, we can make this happen.
(END VIDEOTAPE)
SOLOMON: Meanwhile, the CEO of Korean Air says that he's willing to make concessions to U.S. and EU regulators in order to merge with Asiana
airlines.
(BEGIN VIDEOTAPE)
WALTER CHO, CEO OF KOREAN AIR: No, I'm not going to let go. I'm full on and I'll fight to the end to gain this approval. And we are talking with DOJ
and EU in a positive way. And I expect some sort of resolution by towards the end of this year.
QUEST: So that really depends on what concessions you're prepared to make.
CHO: That's part of the request from both committee, U.S. and the EU. And we're fully committed to meeting their request and will do whatever it
takes to get this deal done.
QUEST: Is there a point upon which you will say this isn't worth it?
CHO: No, I will, no matter what I'm going through with it.
QUEST: Why?
CHO: Because it is very important for Korean Air and Asiana employees, our family and for the industry, every airline industry in Korea, it's very
important deal.
QUEST: I suppose the argument would be well of Korea, if you don't, if the deal fails, Asiana either gets bought by somebody else. Probably not since
you're the dominant carrier there, or it goes out of business and somebody else starts up?
CHO: Yes, but to me, this is very important, because I've committed to it once and many of our employees and are looking forward to it and looking
upon me to get this deal done. And I will get it done.
(END VIDEOTAPE)
SOLOMON: More to come there and more to come here. Still ahead, crypto clampdown U.S. government suing Coinbase, one day after taking action
against another crypto exchange Binance. What all this, means for customers just ahead.
(COMMERCIAL BREAK)
[09:50:00]
SOLOMON: Welcome back to "First Move", the U.S. government coming down hard against two of the world's best known crypto exchanges Binance and
Coinbase. The SEC announcing just a short time ago that it is suing Coinbase for violating securities rules and you can see Coinbase has off
about 17 percent.
Coinbase shares down sharply again 17.4 percent. Let's call it all of this after officials filed the more than 130 page complaint against Binance and
its CEO on Monday. Allison Morrow joins me now.
So Allison, I want to start with Binance. Binance says it plans to defend itself and denies its allegations. But it appears some investors really not
sticking around to see how this ends. We are seeing major outflows already.
ALLISON MORROW, SENIOR EDITOR OF CNN BUSINESS: Yes, it's absolutely panic moment in crypto right now. Investors overnight transferred about $800
million out of Binance, which is both overseas and part of its U.S. division. And I think that's really striking just because of the nature of
crypto traders who are having almost religious devotion to these assets and tend to tolerate risk really well.
But I think this all kind of comes back too, there's a shell shock in the industry still after FTX, which was a smaller rival to Binance imploded
spectacularly and is now the center of a massive fraud investigation in the U.S. The industry is still just like reeling from that and they're scared
and the regulatory crackdown seems to be stepping up. And that's, you know, fueling a lot of fear and an already volatile industry.
SOLOMON: Well, Allison, let's head there now, because it does appear to be something of a larger, more widespread crackdown in terms of Coinbase. What
more details do we know there?
MORROW: Yes, so just 24 hours after the SEC sued Binance, it's now suing Coinbase, which is not surprising, but the similarities between the two
lawsuits are pretty striking. And the similarities to FTX are also pretty striking.
So, all of these platforms are accused of running unregistered aka illegal platforms in the United States there. If you live in the United States, and
you're a day trader, you're not allowed to trade a crypto derivative that's just against the law. And the platforms who are selling these derivatives
are supposed to register with the SEC or the CFTC if they're going to offer these products in the United States.
And none of those companies have registered with these entities. So they don't have a license. It's really, it's big for crypto. I mean, they are in
a transition point where they're trying to gain mainstream authenticity and mainstream adoption. And that's really hard when these regulators haven't
like the crypto industry says they haven't provided enough clarity for them to register and to do it the right way.
Of course, this is all going to get worked out in settlements that we'll see over the next months and years. But bottom line, this is not a good
look for crypto six to seven months after one of the biggest implosions in the industry. And we're seeing that reflected in the prices of these assets
which are all falling right now and as you mentioned, Coinbase, U.S. traded company is down some 16 percent today.
SOLOMON: And I think I hear you correctly when you say biggest implosion you're referring to FTX in SBF, who is of course awaiting trial. I think
that is scheduled to begin in October. So Allison laid it out very well, a lot to watch here in the crypto space. Thank you.
MORROW: Thank you.
SOLOMON: And later news, Starbucks is bringing its controversial line of olive oil infused coffee to more cities in the U.S. the Oleato range first
launched in the U.S. in Italy earlier this year. So the drink is made by adding a spoonful of olive oil of course a staple and Italian culture to
coffee.
The product has gained global publicity and also garnered some mixed reviews with some celebrating its alleged health benefits and others
claiming it made them run to the bathroom. Back in February our Poppy Harlow asked the Former Starbucks CEO Howard Schultz, about the new
beverage, listen.
[09:55:00]
(BEGIN VIDEO CLIP)
POPPY HARLOW, CNN ANCHOR: Do you think this transforms coffee?
HOWARD SCHULTZ, FORMER STARBUCKS CEO: I know it'll transform the coffee industry, a very few people outside of Starbucks have tasted it, no
consumer research whatsoever nothing.
HARLOW: Isn't that a risk?
SCHULTZ: I don't think so. I mean, I just think everything we've ever done that has succeeded at Starbucks is proven in the cup.
(END VIDEO CLIP)
SOLOMON: Current, CEO says Oleato was "one of the top five product launches in the last five years". And finally, NASA's mission to explore metallic
asteroid is set for liftoff this October. It's called the psyche mission. It was originally meant to launch last year but a software issue prevented
takeoff.
The mission will use a first of its kind spacecraft to study the asteroid and NASA says the ship should reach it by 2029. It will then orbit the
asteroid for 26 months. So good to be with you today and that is it for the show, I'm Rahel Solomon. "Connect the World" is next.
(COMMERCIAL BREAK)
[10:00:00]
END
