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Quest Means Business
Spain Squeezed; Vegas Casino Heist; Tortilla Trouble; Keeping Up Appearances; Protests Against Greek Austerity Turn Violent Today; American- Style Economics Worries Europeans, Senate Passes Tax Compromise, Fed Continues Monetary Stimulus; Justice Dept. Sues BP, Anadarko, Over Gulf Disaster
Aired December 15, 2010 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MAX FOSTER, CNN INT'L. ANCHOR, QUEST MEANS BUSINESS: Fire bombs in Athens, signs of a season of unrest in Europe.
Spending binge critics lash out as the U.S. Senate passes a big tax compromise.
And, dress to impress, UBS branches in Switzerland get some very personal words of advice.
I'm Max Foster in for Richard Quest. This is QUEST MEANS BUSINESS.
Hello to you.
Europe is caught in the icy grip of austerity and the forecast is for a long hard winter of discontent. That goes whether you are on the streets, on the trading floor, or on the hunt for a job. In Greece, a week of strikes is ending with pitched battles between police and with protestors.
This was the scene in Athens earlier today. Thousands of protestors, of mostly peaceful but there were a small number of violent instances, as you can see. Molotov cocktails were met with police teargas in scenes like this. Left cars and rubbish were burned paralyzing transport and many public services.
Now Moody's has threatened to downgrade Spanish debt. It's current AA1 rating is on review now because of huge borrowing it needs in 2011, largely, intensified by fragile market confidence as Moody's called it. Moody's says Spain's government needs to raise more than $226 billion to see it through just to next week year. The reaction, while the euro slid against the dollar. The threat to Spain's rating highlights continuing concerns over Euro Zone debt more generally.
Well, in the U.K. unemployment is rising up by 35,000 in the three months to October, we're told; 2.5 million people now out of work. The unemployment rate is currently at 7.9 percent. There is pain in the public sector, 33,000 jobs have gone, most to go in a single quarter-most go in a single quarter, actually in more than 10 years.
First, though, let's go to Greece where a former minister in the Greek government is one of those injured in violent protests. Journalist John Psaropoulos joins me now, from Athens.
We just saw those pictures there, John. It seems really dramatic, but does that reflect the mood there in Athens right now?
JOHN PSAROPOULOS, JOURNALIST: Well, it is actually the action-the particular event you referred to, the beating up of former transport minister under the previous government, which was a conservative government-is, I think, the action of a few people. He was shopping in a central Athens area. And he was set upon by people who presumably on their way away from the march (ph).
It is not the habit of mainstream Greek citizens to beat up their politicians. It does not reflect mainstream opinion that a bunch of people should beat up a minister however unpopular. But there are-there is a strong anarchist movement. There is a strong anti-authoritarian movement in Greece. And it does tend to tag along protest marches that do reflect mainstream sentiments and sometimes express itself on the fringes of them or through the middle of them, as happened today.
It may have more to do that anarchists wanted to beat up a former minister with the fact that about 10 days ago police did a raid on a hideout of what they think were terrorist cells operating premises, where they seized material and they made arrests, of suspected members of revolutionary sects and conspiracy cells.
I think the beating up of the minister is more related to that police action than today's political protest.
FOSTER: OK, John Psaropoulos, thank you very much indeed for bringing us up to date on those dramatic images coming out to us from Athens today.
Well, a way from the streets Europe's debt troubles are causing strife in the marketplace. In just a moment we'll go to Madrid for the latest on the threat to Spain's credit rating, which is making headlines around the world.
First, though, there is a real chance vital trade talks could conclude next year. Leaders have been debating a free trade agreement for the past 10 years. Pascal Lamy, the director-general of the World Trade Organization says the Doha Round of talks could finally be coming to resolution. Pascal Lamy joins me now from Geneva, in Switzerland.
We have heard this before, haven't we, Mr. Lamy, what makes you so positive this time around?
PASCAL LAMY, DIRECTOR-GENERAL, WORLD TRADE ORGANIZATION: Well, you are absolutely correct. We have heard this before. But this time I think the ingredients of a conclusion are starting to appear, namely, a strong political will by leaders. And we got that from the G20 (UNINTELLIGIBLE), from including the U.S. when President Obama said that if there was a good deal, he would take it to Congress.
The second ingredient is proper technical preparation. And ambassadors and negotiators have been working very hard. And will be working very hard, January, February, March, here.
And the third is this shared notion that negotiators are in the end game, which I think-I think, and I have to remain cautious, is starting to appear.
FOSTER: OK, but I wonder if we get into next year and currency wars are still in the headlines and unemployment in major economies continues to grow. And governments are under pressure to increase trade barriers, whether or not all this talk will actually fall to the background for political reasons?
LAMY: Well, this is a good question. But we have experienced this for the last two years. Who in November '08, two years ago, would have bet on the fact that world trade would be as open today as it was at the time. And I think the success in the World Trade Organization in keeping trade open, keeping protectionist pressures at bay, during the crisis, which has been so important in the huge recovery of trade-which we have had this year, notably from the developing countries-shows that there is a benefit in reinvesting in the multilateral trading system.
So, it is not just theory, it is not us pleading (ph) for trade, it is just that the experience of the last two years of deep economic crisis have shown that keeping trade open is major contribution to recovery. And I think governments are now realizing this concretely whereas before it might have seemed something of a general proclamation.
FOSTER: OK, and how do we deal with Russia joining the WTO? How much support have they got?
LAMY: Well, here again, things may be switching on the right side. I personally believe that Russia joining the World Trade Organization, after 18 years of negotiations, is now something which is possible for next year. Which, of course, would add a big brownie point, both to Russia and to the World Trade Organization.
FOSTER: OK, Pascal Lamy, thank you very much indeed for joining us from the WTO. Great having you on the program.
Now the news about Spain sent a ripple of unease across Europe's trading floors. All the main markets ended the day in the red. Banks were amongst the biggest losers of the session. They were dogged by worries over sovereign debt. In London, shares in Barclays shed more than 3.5 percent, whilst in Madrid Santander lost more than 2.5 percent.
Irish lawmakers say they will accept a multi-billion dollar bailout. The vote was close, but in the end the ruling coalition got the support it needed. It means Ireland will be able to tap funds from the EU, and the IMF, early next year. It has already passed the necessary austerity measures.
The U.K. finance minister says Britain should make a profit from helping out Ireland. George Osborne says Britain stands to earn more than $600 million in fees and interest as payback for lending the Irish government more than $5 billion. It will be interesting to see how that is taken amongst the Irish public.
Now, President Obama's tax deal has cleared its first major hurdle. The Senate says yes, but it is getting the House of Representatives on board could be a tough sell. We'll tell you why, next.
(COMMERCIAL BREAK)
FOSTER: Now the U.S. Senate has passed President Obama's tax compromise just a short while ago; 81 senators voted for the controversial bill, 19 against. The deal extends federal unemployment benefits and Bush- era tax cuts for even the wealthiest Americans. It still needs approval from the House of Representatives before becoming law though.
At least 27 House Democrats signed a letter Tuesday urging acceptance of the bill without any changes. House Democrats decided in a closed-door meeting last week they wouldn't even consider it in its current form. A lot of politicking has gone on since then.
Speaking before the Senate vote President Obama said there is no room for delay in passing the bill.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I know there are different aspects of this plan to which members of Congress, on both sides of the aisle, object. That is the nature of compromise. But we worked hard to negotiate an agreement that is a win for middle-class families, and a win for our economy. Now we can't afford to let it fall victim to either delay or defeat.
(END VIDEO CLIP)
FOSTER: Now a Laura Tyson is a member of President Obama's Economic Recovery Advisory Board. She is also a professor of business administration and economics at the University of California at Berkeley. She has also served on a number of corporate boards and she joins us now from Berkeley.
And we appreciate you coming on the program.
LAURA TYSON, UNIVERSITY OF CALIFORNIA-BERKELEY: Thank you.
FOSTER: You are one of America's top economists and you are hooked into the Obama administration, and of course, involved in this recovery. A lot of people criticizing the tax cutting plan, whilst, in a way, more is being spend benefiting the economy at the same time. It doesn't seem to achieve anything, this plan by the Obama administration, this bill. But what do you-how do you defend it?
TYSON: Well, I defend it as an economist would defend it. I think if you look at major forecasters around the country, independent, private, non-partisan, have all stated that this is a second form of fiscal stimulus, in a recovery which has been too weak to really bring the unemployment rate down. And the assessments are this package will, itself, perhaps add as much as a percentage point to GDP growth. And we really need that. Because the unemployment rate is stuck at around 9.6 percent; it rose actually last month. And we really have to boost the recovery.
FOSTER: But the debt mountain is getting bigger all the time. And if you look at the Treasury market it does seem as though investors are starting to get concerned about the amount of debt America is in. How sustainable is this?
(LAUGHTER)
TYSON: Well, let me say two things about that; first of all, I think the reaction of the debt market to the announcement of the tax agreement is actually a sign of belief that the U.S. economy is strengthening. If you actually look behind that increase in interest rates what you'll see is not an increase in inflationary expectations, it is an increase in the real interest rate, which is usually associated with an expectation that economic growth will be stronger. So, I think the increase in long-term interest rates actually is a sign of validation for the package.
I do, however, think that the Congress must move with the president next year on a long-run deficit reduction package. Now economists have said that really what the economy needs is some additional stimulus now, combined with a long-run deficit reduction plan. That is what the commission, that President Obama appointed on fiscal stability, said last week. That is what a number of private commissions have said. So, these are problems that must be dealt with together and I hope that the first order of business in the new Congress is to work with the president on a long-run deficit reduction package.
FOSTER: Are you concerned that you are working with a president, though, who can't act politically with the power that he could before? And as an economist you can't sort of get him, or advise him, to do the things that you really want him to do. You have to compromise on everything with all the other politicians?
TYSON: Well, here is some good news here. You know the commission that he reported on fiscal stability and a long-run deficit reduction package, got 11 out of 16 members supported the proposal. And that included Democrats and Republicans. So there is some bi-partisan support on the deficit reduction issue.
I also think there is going to be some momentum coming from the agreement on taxes between the president and the Congress, some political momentum to do more when the new Congress comes back. That is my form of optimism. When I'm pessimistic I worry that many members of Congress see the deficit as a problem, but don't see that cutting taxes contributes to the deficit. It is as if an increase in spending contributes to the deficit, but a decrease in taxes does not. And that is not arithmetically correct. So we have to find a way to convince enough members of Congress that we're going to need a package which has spending in it, but also has revenues in it. And perhaps the best way to do that is going to be in the context of some meaningful tax reform.
Again, the commissions have all agreed, the commissions on deficit reduction, have all agreed that taxes need to-revenues need to be increased, the best way to do that is through tax reform.
FOSTER: OK, we're talking here about the world's biggest economy. The whole world has a stake in it. Just talk to me about your concerns, though, about this hot money that is being created by the monetary policy easing in the U.S., effectively, a lot of hot monies are rushing into emerging markets and causing them problems. Causing bubbles in those markets, isn't it?
TYSON: Well, I think that Chairman Bernanke was very brave this summer. When people were-when the debate about what to do in the U.S. was essentially not moving forward. He said, clearly, the U.S. economy needs more stimulus and a strong U.S. economy, growing faster than it was growing in the middle of the summer, is good for the world economy. And he proposed his QE2 policy as part of that.
But he also said, clearly at the time, we will monitor this. We will look at what happens to the growth of the economy. We will look at the effects and we will make adjustments. Now, as far as-
FOSTER: OK.
TYSON: -the hot money is concerned I would say the following: Some of that is pressure on currencies that in fact should appreciate. I go to the issue of China here. China is grappling with its own inflation problem.
(CROSS TALK)
FOSTER: Yes, Laura Tyson, I'm really sorry. We're going to have to interrupt you. Eminent economists, and we would never do it normally.
TYSON: Sure.
FOSTER: We have some breaking news coming to us from Washington. Thank you so much for joining us on the program.
This just in to CNN, the U.S. Justice Department is suing BP, and other companies, over the Deepwater Horizon oil spill in the Gulf of Mexico in April. A Justice Department statement says the government wants a court to declare the company is liable for costs and damages caused by the spill.
Now, we are hoping to hear from Eric Holder. He is the attorney general in the United States. That is where he is going to be speaking. We understand that he is going to have a press conference any moment now, uh, which is linked to this story about BP. It would be a major story. Not just for BP but also for the American legal system, because it would start off a whole process of legal wranglings in the United States, which could last for months, if not for years.
These are live pictures coming to us from the Washington Justice Department. Eric Holder, the attorney general, due to speak at the podium, just in front of us any moment.
Just to remind viewers, the U.S. Justice Department is suing BP, and other companies, actually, over the Deepwater Horizon oil spill in the Gulf of Mexico in April.
We do want to understand the nature of this legal action. What is it actually they are holding against BP and where are the costs. This will be a huge story for BP. We will get a sense of what kind of legal costs they will face in future. BP shareholders around the world will be interested. And of course, pension funds heavily invested in BP around the world. So it does affect everyone.
I am told we can speak to Stephanie Elam. Oh, there he is, Eric Holder. Let's listen in now.
(BEGIN LIVE FEED)
ERIC HOLDER, ATTORNEY GENERAL, U.S. JUSTICE DEPARTMENT: Good afternoon.
I am pleased to be joined by the administrator from EPA, Lisa Jackson; assistant attorney general from the Civil Division, Tony West; and assistant Attorney General Ignacia Moreno, who heads our environmental and natural resources division.
In the wake of the largest oil spill in our nation's history, Tony and Ignacio helped to lead the Justice Department's efforts to build-to hold accountable any and all parties found responsible for this disaster.
Today we are here to announce the initial results-the initial results-of our civil investigation. Now this investigation began shortly after April 20th of this year, when an explosion and fire destroyed the Deepwater Horizon offshore drilling rig that was located in the Gulf of Mexico, approximately 50 miles from the Mississippi River Delta. This incident claimed the lives of 11 rig workers. And it marked the start of a massive oil spill that would take more than three months to contain.
And it set off a chain reaction of devastating consequences for the people, for the environment and for the economy of the Gulf Coast, a region still struggling to recover from Hurricanes Katrina and Rita.
Now, while oil spill response efforts were underway the Department of Justice launched both criminal and civil probes into this matter. We dispatched dozens of top attorneys to the Gulf Region, and members of the department's senior leadership have also made multiple trips to the area. For months department lawyers and investigators have been working night and day and in close coordination with the local U.S. attorneys offices as well as our colleagues in the state attorneys general offices as well.
As a result of this work, today, the United States has filed a civil lawsuit in the United States District Court in New Orleans against nine defendants. The defendants named in the lawsuit include: BP Exploration and Production, Incorporated; Anadarko Exploration and Production, L.P.; Anadarko Petroleum Corporation; MOEX Offshore 2007, LLC; Triton Asset Leasing, GMBH; Transocean Holdings, LLC; Transocean Offshore Deepwater Drilling, Incorporated; Transocean Deepwater Incorporated, and QBE Underwriting Limited, Lloyds Syndicate 1036.
Now, in the complaint the United States alleges violations of federal safety and operational regulations, including failure to take the necessary precautions to secure the Macondo well, prior to the April 20th explosion; failure to utilize the safest drilling technology to monitor the well's condition. Failure to maintain continuous surveillance of the well and failure to utilize and maintain equipment and materials that were available and necessary to ensure the safety and protection of personnel, property, natural resources, as well as the environment.
Now we intend to prove that these violations caused or contributed to the massive oil spill and that the defendants are therefore responsible under the oil pollution act for government removal costs, economic losses, as well as environmental damages.
We are also seeking civil penalties under the Clean Water Act, which prohibits the unauthorized discharge of oil into the nation's waters. We allege that the defendants named in this lawsuit were in violation of the act through the months that the oil was gushing into the Gulf of Mexico. And we intend to hold them fully accountable for their violations of the law.
Over the past year, I myself have visited the Gulf Region multiple times. I have seen the devastation that this oil spilled cost throughout the region, to individuals, and to families, to communities and to businesses, to coastlines, to wetlands, as well as to wildlife.
Even though the spill has been contained and even though it no longer is the focus of around-the-clock news coverage that we saw, and the subject of front page headlines, the department's focus on investigating this disaster and preventing future devastation has not waivered. While today's civil action marks a crucial first step forward, it is not, it is not a final step. Both our criminal and civil investigations are continuing. And our work to ensure the American taxpayers are not forced to bear the costs of restoring the Gulf area and its economy goes on. As I have said from the beginning, as our investigations continue, we will not hesitate to take whatever steps are necessary to hold accountable those who are responsible for this spill.
The civil investigation into the Gulf Coast spill is being handled by the United States Environmental Protection Agency, the United States Coast Guard, the National Oceanic and Atmospheric Administration and the Department of the Interior's U.S. Fish and Wildlife Service, and Bureau of Ocean Energy Management Regulation and Enforcement.
And I want to thank all of these partners for their tremendous efforts. Now as our investigations move forward Justice Department attorneys will continue to-
(END LIVE FEED, IN PROGRESS)
FOSTER: Eric Holder there, in the Justice Department of the United States, announcing that the Obama administration is actually suing BP, its- and several other companies involved in that Gulf of Mexico spill, back in April. We were listening out for some level of damages they are seeking. We haven't got that. That is what investors wanted to hear. So we are going to cross to Stephanie Elam, who is in New York monitoring market reaction there.
What have they made of it there? This has a huge impact on a lot of companies, doesn't it?
STEPHANIE ELAM, CNN FINANCIAL CORRESPONDENT: Yes, well, you know, Max, right when the news broke and you first mentioned it, I took a quick look at BP stock here and it was off about a 0.25 of a percent. Now it is off about 2.33 percent at this time. So, obviously investors don't like what this means, probably, for BP stock, even though there wasn't a monetary number that was mentioned in there.
Overall, the markets have turned negative since this news came out, too. I'm looking at the Dow now, on the downside, a slightly larger loss here for Nasdaq as well. It wasn't like we were going gangbuster to begin with though, so it is worth pointing out at this point. I don't know if necessarily this was much of a surprise to people on Wall Street that there maybe more lawsuits ahead after we saw the severity of what was going on this spring.
FOSTER: The problem, I guess, Stephanie, is that we don't have any idea about where the costs will end. Because Holder is basically saying that the American taxpayer isn't going to foot the bill for this. And the legal process will continue until all the companies are made accountable. But they can't make any calculations based on this, can they?
ELAM: Yes, no, it is very murky waters that we're going into-and that was a pun I wasn't even trying to make, but after I said it, I realized it. But it is true. At this point, if there is not a monetary number to put on it, and when you think about, well, what is the exact cost of what happened? How do you qualify or quantify how much it is for someone who maybe lost their job, or for someone whose business was put out? Business because of the fact that people weren't coming to visit the Gulf of Mexico? All of these things that were affected and people who went then for government aid, after that period. How do you quantify that amount of money? And that is what makes it so difficult. And that is probably why didn't actually hear a monetary number in this case. Because I bet you they don't want to limit it at this point, Max.
FOSTER: OK, Stephanie, thank you very much indeed. Back with you as you get more market reaction in the next hour, to that press conference still continuing.
If you are still in a gambling mood the odds of Spain avoiding economic meltdown might just have gotten narrower. Confidence in Spain could be slipping, but will it be the next domino to fall here in the Euro Zone. We'll bring you an update in just a moment.
(COMMERCIAL BREAK)
FOSTER: Welcome back.
I'm Max Foster.
Some breaking news for you.
The U.S. Justice Department is suing BP and other companies of the Deepwater Horizon oil spill in the Gulf of Mexico in April. A Justice Department statement says the government wants a court to declare the companies liable for costs and damages caused by the spill. We just heard from the U.S. attorney general confirming this on CNN.
And protesters threw Molotov cocktails while police fired back with teargas in Athens. Thousands of Greeks poured into the streets, the start of a week of strikes to protest against the country's austerity measures. The strikes are affecting public transit, hospitals, banks and courts.
Top Iranian officials are quoted by state media blaming the United States and Britain for a deadly suicide attack on Wednesday. At least 32 people were killed and dozens of others were wounded in the southeastern city of Karbala as they observed Ashura. A Sunni militant group linked to previous attacks has claimed responsibility. The governor of the area says a suspect has been taken into custody.
The International Criminal Court says a number of prominent Kenyans were behind the election unrest that tore the country apart two years ago. Prosecutor Luis Moreno Acampo is accusing a half dozen suspects, including the son of the country's founder of masterminding the violence that left 1,500 people dead. Judges at the Hague-based court will now decide if the men should face trial.
And it's Facebook -- and his Facebook has redefined social networking. Now his face is on the front cover of "Time" magazine. Facebook creator, Mark Zuckerberg, has been named "Time" magazine's Person of the Year for 2010. WikiLeaks founder Julian Assange and Afghan President Hamid Karzai were also considered for the front page.
Now, Spain is reeling from a major blow tonight. Moody's, the credit ratings agency, says it's reassessing the risk of investing in the country and it may downgrade its current Aa1 rating. It sent a shiver across the region. The euro sank against the dollar, as traders worry about the financial health of a major European economy. And even a suggestion of downgrade is already having an impact. Spanish borrowing costs are up tonight. On a 10 year bond, the rate is close to 6 percent. Spain did successfully borrow some more money on the open markets on Tuesday, but it had to pay a premium for it.
Now, our Madrid bureau chief, Al Goodman, explains now just what the Moody's downgrade means.
(BEGIN VIDEOTAPE)
AL GOODMAN, CNN MADRID BUREAU CHIEF: Well, Moody's is saying that they're concerned that Spain won't be able to raise large sums of money next year. They're concerned about the financial situation of the Spanish savings banks, which are called cajas and which formerly have been these locally run, sometimes with political -- local political control, not professional bank management control. The central bank has been trying to reduce these numbers of savings banks and bring private capital in. But Moody's seems to be saying they're concerned about that process.
And they're also concerned about the debt of Spain's -- many of Spain's regional governments. This is a very decentralized country. In addition to the national Spanish government having a huge debt, many of the regional governments -- the Madrid regional government, the Catalan regional government around Barcelona, the Basque regional government in the north, many of them have staggering debts, as well.
Moody's raising an alarm. And it's noteworthy that Moody's, just a few moments ago, still maintained Spain at the highest rating level then took it down a notch a few months ago and now they're talking about maybe taking it down some more -- Max.
FOSTER: That's right. And when you look at the financial markets, they don't seem to be factoring in a bailout for Spain.
So within Spain, are they worried about this or are they just watching it?
GOODMAN: Well, of course, they're worried about this at the government level. Immediately, the finance minister, Elena Salgado, was out in front, repeating a message. But this time, she was able to actually read the entire Moody's statement. And if you do, you see that they're not questioning the solvency, they say, of Spain. They say that Spain is actually not in as bad a shape as some of the other stressed Eurozone countries.
So the government playing on that. And then, also, the backup position. The government saying, look, even if there is a downgrade -- and we hope there won't be -- but if there -- even if there is, this is not going to be a junk bond status. This would be just somewhere up there at the low As, high Bs. So not a bad rating after all -- Max.
FOSTER: So comparisons between Spain and Ireland still are over exaggerated at this point, at least?
GOODMAN: Well, for many here -- and I've just been at a briefing with some financial experts -- for many here, Spain is not the next to fall, not the next to need a bailout. The numbers in Spain -- and the government will tell you this, many financial experts will tell you this, the numbers, if you just look at the numbers in Spain, are still much better than many of the other countries.
Of course, Spain's neighbor, Portugal, is under heavy watch from a lot of different angles. And so the thinking here is if Spain can help Portugal stay out of the bailout category, stay out of the Ireland category -- although there's a lot of pressure, that will ease the pressure on Spain. The thinking is that if Portugal finally does go down, needs a bailout, then that would really increase the pressure on Spain for something similar. And if it came to that, then these smaller countries -- Ireland, Portugal -- Spain is much bigger as an economy than -- than those two countries and Greece put together, then there would be some real concerns about, potentially, the future of the euro -- Max.
FOSTER: Indeed.
Al Goodman there speaking to us.
Now, if you've ever seen "Ocean's 11," "12" or "13," you'd think holding up a Las Vegas casino would be a complex operation. But this man managed to steal $1.5 million in chips from the Bellagio Casino just by walking up to the craps table and pulling a gun. It's the tenth robbery at the Vegas casino this year.
Casey Wian is live for us now from Vegas.
They're calling it "Ocean's 14," aren't they?
(LAUGHTER)
CASEY WIAN, CNN CORRESPONDENT: I haven't heard that yet. You're the first one to coin that phrase, but I guess it's pretty appropriate.
You know, one of the things you see in Hollywood movies is shootouts in casinos when the -- when robberies try to happen. That didn't happen here. He was allowed to actually walk out of the Bellagio Casino. The casino employees called 911 while he was still there, but apparently they didn't want to risk the exchange of gunfire and the potential injury to patrons.
It's really -- police are calling this the most brazen casino robbery they've seen in quite a long time.
What's really interesting about this is that he walked past a cage where there's cash and went, instead, to the craps table and to chips. And why that's interesting is it's very difficult to cash in these chips, especially the higher denomination ones. He took chips ranging from $100 to $25,000. And the casinos have security measures in place for these higher denomination chips and in some cases, they've even got electronic devices similar to a credit card implanted into some of these chips to make sure that they're not cashed in by the wrong person. They want to say what specific measures were in place this time, but casino industry executives say they don't expect this casino to suffer significant losses.
They also believe that this is the same robber who hit another casino about 20 minutes off the Strip about four or five days ago. That was the Suncoast Casino. In that robbery, he also walked in off of his motorcycle wearing a full -- a full-faced motorcycle helmet at gunpoint. But this time, he took about $20,000 in cash.
So they're looking for this guy. They believe they're -- they're going to be able to find him in the area, because they don't think there's anyplace else that he would go with these chips -- Max.
FOSTER: Casey in Vegas.
Thank you very much, indeed, for that fascinating story. It's got Hollywood written all over it.
Now, the cost of filling up your shopping basket just keeps on rising in many parts of the world. And the humble tortilla could cause some hungry headaches in Latin America. We'll have a live report from Mexico in just a moment.
(COMMERCIAL BREAK)
FOSTER: Now, it is one of the things that every person on the planet can't do without and the cost of food has the power to put an economy into all kinds of directions. Here in the U.K., record prices and record rises in the price of food have helped to push overall inflation numbers well over the government's targets. Food prices rose 1.6 percent in just one month, between October and November.
In the U.S., food prices rose 1.5 percent in 2010. That's a modest rise, but will still be enough to hit consumers' wallets.
And in China, we're seeing huge increases in food prices. They've risen more than 11.5 percent in the past 12 months, making it the main driver of inflation. But inflated food prices could redirect money from China's wealthier urban areas, to the rural peasants who actually produce the food.
Now, in Mexico, inflationary pressures have helped push the price of tortillas up by up to 50 percent recently. They're such a staple food, that they're almost an economic indicator in themselves.
As our senior Latin American affairs editor, Rafael Romo, reports, more expensive tortillas spell trouble for many Mexicans.
(BEGIN VIDEOTAPE)
RAFAEL ROMO, SENIOR LATIN AMERICAN AFFAIRS EDITOR (voice-over): It's been a staple of the Mexican diet for centuries -- the thin, round, unleavened bread made from ground corn is consumed daily by millions. But an apparently imminent hike in the price of tortillas is causing a public outcry.
PEDRO VANGALA, CONSUMER (through translator): It will affect me considerably in my case, because my family needs two kilos a day, which means that what we pay will go up from 16 to 24 pesos -- 50 percent higher.
ROMO: For many Mexicans, a 50 percent increase would be hard to digest. Minimum wage in Mexico is 57 pesos per day, a little less than $5 U.S. The Mexican government says the hike is the result of speculation by some producers, who are trying to increase their profits at the end of the year.
BRUNO FERRARI, MEXICAN ECONOMIC MINISTER (through translator): We won't tolerate any abuse or opportunism affecting consumers. We will intensify our
Operations to verify legitimate prices in order to protect consumers.
ROMO: Internationally, corn prices have been recently unstable, but authorities say that Mexico is not facing a corn crisis.
MANUEL MARTINEZ, MEXICAN AGRICULTURE MINISTER (through translator): The supply of corn in Mexico is guaranteed. We have actually recorded an increase of 24 million of metric tons in the production of white corn.
ROMO: But some in the Mexican business sector say the price of tortilla is influenced by many other factors besides corn.
GUILLERMO CAMPOS, CORN AND TORTILLA ASSOCIATION (through translator): On the other hand, we must understand that there are inflationary pressures. Tortilla producers are businesspeople in it is a fact that the price of corn has recently risen. We've also seen increases in the price of fuels.
ROMO: The corn and tortilla production in Mexico is an industry that brings together about 90,000 producers organized in different associations that can set prices as a group.
(on camera): The government stopped regulating tortilla prices in 1999. Prices are now dictated by domestic supply and demand. But the price of corn internationally can affect supplies and influence how much Mexicans pay for their daily tortilla.
Rafael Romo, CNN, Atlanta.
(END VIDEO TAPE)
FOSTER: Weather causing many problems for food producers around the world, of course, of the year.
Jenny Harrison is at the World Weather Center looking at the -- the winter in this part of the world, which is having a dreadful impact, as well.
JENNY HARRISON, CNN METEOROLOGIST: Yes, it is, indeed, Max, when it comes to traveling, that's for certain. The good news, actually, is when it comes to last night's freeze in Florida is that so far, the reports are that there wasn't a great deal of crop damage at all. So some good news there, but not a lot when it comes to traveling across in Europe.
The same picture again, a lot cloud and, of course, most of those clouds bringing something with it, rain or snow. Temperatures on the decrease again. These are the temperatures with the wind factored in, so that's minus 12 in Oslo right now; minus 14 in Munich. And the temperatures in the northwest also on the decline, minus 13 is how it feels in Milan; cold in Madrid at minus three.
And this is what is set to head in as we go into Thursday, a very, very vigorous area of low pressure, some very strong winds, very low temperatures.
And we're looking at a mix of snow, but also some rain and ice across much of the U.K. And, again, this system will push across into northern sections of mainland Europe. That sea effect snow, just like lake effect snow, when the winds come down from the cold north, pick up all the moisture from the warmer water -- not warm, of course, but warmer than the air -- and then deposit it back down as snow.
As you can see it just absolutely piling across northern and western sections part of the U.K. There are many warnings in place, in fact, fairly widespread across the country.
And the winds already beginning to increase from the north. So this is where the weather will come in from. That's where the strongest winds will be. But as I say, coastal areas also will be as Priya said, impacted. And those winds aren't going to stop across the U.K. They'll travel off the coast across into western portions of Europe and push down into the Western Med.
And look at the temperatures, as I say, for the next few days. Temperatures well below average again. And even for the start of weekend, you could be seeing some snow in London. Most probably there will be rain on Thursday for you in London, but it will, of course, change to ice and freeze in the overnight hours with the temperatures so low.
In Paris, again, I'm afraid quite a bit of snow in your forecast over the next few days. And temperatures so low that it's going to stay in the frame.
And then look at this through the Eastern Med. Warnings in place through Greece, pushing across into Turkey, although by the weekend, the temperatures are a little bit milder into Western Turkey. But at the same time, the winds quite strong, too, with that system. North Atlantic is seeing some strong winds, as well.
Here is the forecast -- rain, thunderstorms, snow curling up toward the north for much of the Balkans. You will be seeing some fairly hefty snowfall. And there's the wider picture across Europe. And as I say, some very heavy snow, in particular, across much of France. The southeast and then, of course, across the line of the alps. But look at the delays on Thursday. They're very widespread starting across in the northwest and then some long delays again across into Germany and Central Europe, as that snow continues to come down. And, of course, it stays there, with temperatures so low. Those are the daytime highs, minus four in Vienna, about plus four in Paris -- Max.
FOSTER: OK, Jenny, thank you very much, indeed, for that.
Now, we call him the man behind Facebook. His friends call him Mark Zuck, or just Zuck. "Time" magazine calls him the Person of the Year, though. Twenty-six-year-old Mark Zuckerberg is the second youngest person ever to receive the title. Charles Lindbergh was just 25 when he was awarded it back in at 1927.
On paper, Facebook has made Zuckerberg a billionaire six times over.
Facebook has changed how much of the world interacts. Its members worldwide add up to more than double the population of the United States. Other contenders for "Time's" Person of the Year were Afghan President Hamid Karzai and WikiLeaks' founder, Julian Assange.
Well, you might be asking yourself, where is Richard?
He's been out on assignment in Israel. If you follow him on Twitter, you probably know that. He's sending updates and pictures from trains, planes and many other places. So follow him around the globe at Twitter.com/richardquest.
Coming up on QUEST MEANS BUSINESS, how long does it take you to get ready for work in the morning?
Well, it might take you a little longer if you have to read through an entire dress code, first of all. We'll tell you how UBS staffers are dressing to impress.
(COMMERCIAL BREAK)
FOSTER: Let's recap on a story that's just come into CNN.
The U.S. Justice Department is suing BP and other companies over the Deepwater Horizon oil spill in the Gulf of Mexico back in April. A Justice Department statement said the government wants a court to declare the companies liable for costs and damages caused by the spill. Amongst the companies being sued is Transocean, owner of the rig that exploded, killing 11 workers and causing the worst oil spill in U.S. history.
Here's what U.S. attorney general, Eric Holder, said at a press conference just a few minutes ago.
(BEGIN VIDEO CLIP)
ERIC HOLDER, U.S. ATTORNEY GENERAL: And what we've indicated is that -- and what I said in my opening remarks is that this is an ongoing process, both the criminal investigation as well as the civil inquiry. And it is conceivable that, as time passes and as evidence is developed that additional -- additional entities will be added to the -- to the complaint. So this is where we stand as of now.
(END VIDEO CLIP)
FOSTER: we'll bring you more on that as it develops, that story. There will be lots of reaction and particularly from the markets.
Now, here at CNN, we do always try to look our best. Meanwhile, hope you agree. And if you'll excuse the pun, staffers at UBS seem to be following suit. We have a few of them here, not their suits, CNN suits, a bit dusty, some of them, as well.
Workers and a dress -- guess who's that is?
Workers at UBS retail branches in Switzerland have been given a lengthy dress code in order to give the company's image a more professional sheen.
Now, here are some of the don'ts on the list. For women, short skirts are strictly off limits, as are any clothes considered too tight.
This is all according to the list.
If those UBS staff get novelty socks for Christmas, they won't be wearing them to work -- at least they won't keep their job if they do. Cartoon socks apparently go against this code.
And it's not just clothes. If UBS staff were hoping for a garlicky snack on their lunch break, forget it. Foods that give you bad breath, even, are off the menu.
It's all about image and it's all about sales, at the end of the day, I guess. Keeping your job isn't just about looking the part.
Our Jeanne Moos reports on a man who was suspended for viciously mowing down an innocent snowman.
Some of our younger viewers may find the following images disturbing.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN CORRESPONDENT (voice-over): It was a hit and run on a snowman.
UNIDENTIFIED MALE: Oh! No! No!
MOOS: And it cost a bus driver his job.
(singing)
MOOS: But this story has no fairy tale ending. It happened in Champaign, Illinois on a video posted to YouTube. You see a car go into the bus's lane to avoid the snowman and then the bus crosses over and takes him out.
UNIDENTIFIED MALE: Oh, my God!
MOOS: "Dude went out of his way into the opposing lane to kill the snowman," said critics, while defenders called it "clearing the road of an obstacle. Hail to the bus driver."
But when the mass transit district saw the video, the unidentified bus driver lost his job -- resigned, apparently facing suspension.
"Most would agree that there are more responsible ways of dealing with an obstruction in the road, such as calling our control center, calling 911, et cetera, than driving westbound in an eastbound lane of traffic."
(on camera): Funny they should mention 911. The other day, a woman in England was chastised for calling the English version of 911 to report her snowman stolen.
UNIDENTIFIED FEMALE: Your snowman's been stolen?
UNIDENTIFIED FEMALE: Yes.
UNIDENTIFIED FEMALE: And what do you mean?
Was the snowman actually made out of snow or an ornament?
UNIDENTIFIED FEMALE: No, he's made out of snow. I made him myself.
(BEGIN VIDEO CLIP FROM "SATURDAY NIGHT LIVE," COURTESY NBC)
SETH MYERS, CAST MEMBER, NBC'S "SATURDAY NIGHT LIVE": Oh, sure. The police are happy to get involved when a white person goes missing.
(END VIDEO CLIP)
MOOS (voice-over): The guys who shot the bus video tell CNN they didn't build the snowman, they just shot it, thinking it would be a funny thing to post online.
(on camera): Now they're feeling guilt-stricken -- not about Frosty's demise, but about the bus driver losing his job.
(voice-over): So guilty they've started a "Save the Bus Driver" Facebook page, saying it's a good deed he did, using his big bus to break up the snowman. Look what can happen when windshield meets Frosty. Now, that's defrosting.
UNIDENTIFIED MALE: It destroyed my windshield.
MOOS: For some reason, some guys love decapitating Frosty.
UNIDENTIFIED MALE: Hello, little fellow.
MOOS: He's been put on railroad tracks. He's been axed. He's been torched. It sort of makes getting hit by a bus seem like a mercy killing.
Jeanne Moos, CNN, New York.
(END VIDEOTAPE)
FOSTER: Only Jeanne Moos can put together pieces like that.
Incredible stuff.
Now, our main story, of course, is the U.S. Justice Department suing BP and other companies over the -- that oil spill in the Gulf of Mexico back in April.
We're checking the markets for you. We're going to have a proper check in a few minutes. But the Dow is down on that news and obviously BP is down on that news. There is concern that the legal bills will mount as this process, which could last for months, lingers on. And other companies, of course, Transocean, involved, as well, also going to be involved in these court -- court cases coming up.
We'll see what happens.
We'll bring you all the details and the reaction from the companies involved as the hours tick on.
(COMMERCIAL BREAK)
FOSTER: I promised you I was going to take you to the big board and see what it's doing after that news on BP and other companies being sued after the oil spill back in April. It's actually down, but it's not down as badly as it was. It's down .24 percent.
Also, the Senate voted on that tax cut bill, as well.
We're going to keep following those stories for you.
But the market reaction not too bad, actually, right now.
And now, with just over a week to go until Christmas, plenty of people have already got their Christmas trees up. And in Abu Dhabi, there's been some serious festive spending along with the festive spirit. Check this out. Believe it or not, this is a Christmas tree worth more than $11 million. As you might guess, it's down to the decorations. The manager of the Emirates Palace Hotel says that makes it the most expensive Christmas tree in the world. Instead of baubles and chocolates, this tree has been decorated in gold and precious stones.
Why not, if you've got the money?
But as we all know, it's what's underneath the tree that really counts.
Unbelievable.
That is QUEST MEANS BUSINESS.
I'm Max Foster in London.
Thank you very much, indeed, for watching.
"WORLD ONE" starts right now
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