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Quest Means Business
Consumer Electronics Show; Interview with M. Jonathan Rothberg; British Government's New High Speed Rail Project; Analysis of the Race for the Republican Nomination; Fitch Slams EU Leaders; Greece Bailout Not Finalized; European Markets Rebound; IMF Chief and German Chancellor Meet; Christine Lagarde Optimistic; US Markets Up; Northern Rock Rebrands; Richard Branson of Virgin Group; Tsunami Warning in Sumatra; Footballer Eric Cantona's Play for French Presidency Publicity Stunt; Effect of Cantona's Presidential Bid on Housing Issue
Aired January 10, 2012 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, HOST: Fitch starts the finger-pointing and warns Italy, pull your finger out.
Banking on Virgin money. Richard Branson tells me tonight we're no chip off the old Rock.
And Eric Cantona's home game, a presidential publicity stunt.
I'm Richard Quest. I mean business.
Good evening. Europe's recovery has stalled, and it's the fault of the men and women behind the wheel. Fitch says EU leaders have failed to keep Europe on course and that downgrades will follow in the weeks ahead as the whole thing careers off the road. It's a sad and serious situation, and you'll see more if you join me in the library.
The Fitch ratings agency has criticized EU leaders, saying they lack leadership at the EU level. On the question of sovereign ratings, the head of sovereign ratings says the recovery has stalled.
Now, you may well be saying to me, well, tell me something you don't know. Bearing in mind the OECD, the EU, and the IMF and everybody's reports that basically European growth -- eurozone growth is expected to be stagnant if not recession.
But Fitch also says that there's a significant chance of an Italian downgrade this month, although no likelihood of a French downgrade this year.
As for the main thrust of the criticism, David Riley leaves that for the leaders and says the EU's moving in the wrong direction.
(BEGIN VIDEO CLIP)
DAVID RILEY, HEAD OF SOVEREIGN RATINGS, FITCH: Well, now we're going into 2012, where the economic recovery in Europe is completely stalled. So really, we've taken a step back.
What we've been lacking, really, is the clear leadership at the EU and eurozone level as a whole, and that will continue, we think, to be a recurring theme and feature of this crisis.
(END VIDEO CLIP)
QUEST: And nowhere is that better seen than when it deals with Greece. So far, that second bailout negotiated but not finalized, the pier side of private sector involvement still not agreed, the level of the haircuts.
The Greek deputy finance minister says progression of talks are taking place, but no deal yet, even though the EU economics commissioner, Oli Rehn, says the deal will be financed -- or finalized shortly. Fourteen and a half in dollars due to be dealt with. Beg your pardon, that should be euros to be dealt with in the first few months, weeks of this year.
Now, European markets. Despite all this grim news, they did stage an impressive rally. Look at that, from the DAX up 2.5, French CAC Quarante up 2.66, boosted. The financials, ironically, were boosted by the Fitch comments because the feeling is that something might actually take place. French industrial production also unexpectedly up.
That's the scenario within which this evening, in the last few minutes, the German chancellor Angela Merkel has begun meeting the head of the IMF, Christine Lagarde. The French -- the Greek haircut is one of the issues that they will be discussing.
Lagarde has repeatedly said she is "desperately optimistic" about the state of the global economy, as she told our own Robyn Curnow at the weekend.
(BEGIN VIDEO CLIP)
ROBYN CURNOW, CNN INTERNATIONAL CORRESPONDENT: What is your outlook for the year?
CHRISTINE LAGARDE, MANAGING DIRECTOR, IMF: I'm desperately optimistic and will continue to be desperately optimistic.
I know that we will have tough times to go through. There will be storms. There will be difficult times, difficult decisions, a sense of we are in it together, we have to get out of it together that will need to be reinforced, rehashed regularly, repeated.
And I hope the IMF will contribute to that sense of collective endeavor that is about the global economy moving forward, creating jobs, and creating value.
CURNOW: So, this warning -- the headlines, I saw that you'd warned of a 1930s-style global slump. Was that misreporting, or have you changed your tune?
LAGARDE: No, no, no, no. I haven't changed any of that. But what I said and what I continue to be extremely concerned about and vigilant about is some of the stigmas that we saw at the time. The approach consisting of -- retiring back to my own knitting.
Never mind what's happening outside in other countries. I'm going to mind for myself. This sort of hidden, horrible protectionism monster showing up in various shape or forms. That is something that I would be very concerned about and that we shouldn't see being resurrected now.
CURNOW: So, is that for you the greatest danger in the next year, is a resurgence of isolation and protectionism.
LAGARDE: Yes, yes, yes, yes. Absolutely.
(END VIDEO CLIP)
QUEST: The managing director of the IMF, Christine Lagarde, "desperately optimistic." The New York markets --
(RINGS BELL)
QUEST: -- casting a bit of an optimism of its own, up nearly 70 points to the session so far to the good. Alison Kosik is at CNN's New York bureau. Good evening, Alison. The question first, why should the markets be up today? Any particular movement?
ALISON KOSIK, CNN CORRESPONDENT: You know what? It's a little bit of focusing on the positive of Fitch, focusing on the positive of Alcoa's earnings.
And it's a lot of sort of the -- I'd say the game that's being played in the fourth quarter earnings for many companies, preparing investors ahead of time to expect less, so then when less comes in, if those earnings actually beat those lower expectations, you'll see the market rally, and that's really what you're seeing here.
Because Alcoa actually reported its first quarterly loss since 2009, but what you see are the markets rallying because what Alcoa did is give a favorable outlook. It gave good guidance this year, it expects aluminum prices to rise, so you're seeing Wall Street focus more on the positive.
So -- and then you look at the sense of expectations overall. They're not too terrible. S&P 500 profits are expected to rise 7.5 percent in the fourth quarter from 2010 in the fourth quarter.
Yes, I know, Richard, you're about to say it sounds great, but corporate America is coming off of eight straight quarters of double-digit growth, so 7.5 percent doesn't seem so great. But listen, you've got to -- you've got to sort of grab the good stuff while you have it. With all the pressure from Europe, can you blame them?
QUEST: Am I that predictable, Alison? There's a --
KOSIK: Yes, you are.
QUEST: Because that's exactly what I was going to say. Double-digit growth, there's no double-digit growth!
KOSIK: Well, you know what? Expectations are lower for the fourth quarter, and that's what I mean. You're seeing the market rally on these - - they're not the best earnings, to say the least. But if you're managing the expectations, which these companies seem to be doing right now, you're going to see Wall Street react a little bit more favorably, Richard.
QUEST: Once we get into the mainstream of the earning season, Q4 earning season, you'll be helping us with the Q25, as always, won't you, Alison?
KOSIK: I'll be more than happy to.
QUEST: Yes, we'll soon put this double-digit stuff to grips. All right, many thanks, Alison Kosik in New York with the Dow --
(RINGS BELL)
QUEST: -- 62 points. After the break, it's a case of trains, planes, and now, High Street banks. In a moment, Sir Richard Branson on why rebranding a credit crisis casualty has been such a good idea, in a moment.
(COMMERCIAL BREAK)
QUEST: An infamous symbol of the financial crisis has disappeared, or will be very shortly, from the UK High Street. Northern Rock has been rebranded as Virgin Money, and that started with the flagship branch in Newcastle.
Sir Richard Branson's Virgin Money bought the lender from the UK government last November, $1.2 billion. In 2007, these were the pictures that we saw as Northern Rock experienced the UK's first bank run in more than 100 years.
The bank was nationalized in 2008. It became a harbinger and a symbol, an icon, whatever you like, for what was dreadfully going wrong in the UK banking system. Today, I spoke to Sir Richard Branson. He told me his plans for the rebranded Northern Rock.
(BEGIN VIDEOTAPE)
RICHARD BRANSON, FOUNDER AND CHAIRMAN, VIRGIN GROUP: The goal is to create a great bank, a bank that has a great reputation, that offers fantastic products to the consumer, and one that brings a positive reputation back to banking.
Banking has, obviously, somewhat blotted its pocketbook over the last two or three years, nearly brought the world to its knees. And so I think it's a good time to come in with a fresh approach.
QUEST: Particularly for an organization that basically started the crisis off in the UK, didn't it? The run on Northern Rock, which then got bailed out.
BRANSON: Yes. And then, four years ago, there were queues of people outside Northern Rock branch who'd planned to take their money out. I'm delighted to say today there are queues of people bringing their money in.
Having High Street banks is something which -- which we feel good about, and I think we've got 75 at the moment, and we'll build up to a couple of hundred over the next couple of years.
QUEST: That's a sizable operation to have to manage, and I understand you're not going to be managing it personally, but it does take Virgin Money into a different area. Are you ready for that?
BRANSON: Yes, we are. I mean, we've got -- we're one of the most well-capitalized banks in the UK, and I think we have a lot of experience in managing biggish companies. Virgin Airlines 25 years ago started with one secondhand 747. We now have four different airlines around the world.
QUEST: Talking of Virgin Airlines and Virgin Atlantic, how worried are you, now? It does seem -- despite your opposition, and I know you will be opposing BMI sale to British Airways, but that does look like it probably will go through. Where does that leave you?
BRANSON: I would be flabbergasted if the competition authorities allowed British Airways to absorb British Midland. I mean, if you can think of what a competition authority's job is, it is to stop people monopolizing.
Yes, they allowed British Airways and American Airlines to cozy up together and Cathay and Iberia and a whole lot of others. But to add British Midland on top would, I believe, be one deal too many, and therefore, we would expect and hope that the competition authorities will say no to it.
And if they say no to it, then we're there to buy it at a fair price. The British -- the price that British Airways are offering is a price purely to stop the competition getting it.
QUEST: Emissions. So, the scheme is now in. The scheme is now in. The Chinese are saying they're not going to pay. The Americans are very unhappy about it, and you're numbered with every flight that you run out of the UK paying -- and you're paying emissions carbon credits.
BRANSON: I suspect that the authorities will do better to try to encourage us to develop clean fuels. And we have actually now developed fuels that we can use in our planes and will be using in our planes in the years to come that are clean fuels.
And at the very least, what we hope is that the authorities will make sure that they drop all these taxes if we start filling our lanes with clean fuels, and that they're not just an excuse for more taxes for the authorities.
QUEST: Aviation, telecoms, banking, entertainment. All the different areas money -- now money, or bigger money. Is there an area that you're not in that you would like to be in?
BRANSON: We love to go into industries which are not very well run and try to shape them up. And we've done that in quite a lot of different industries. Obviously, we've got space to look forward to, and we're very much hoping that we're going to space at the end of this year.
We're looking at submarines to take people to the bottom of the oceans which, again, we hope to be doing later this year. And I'm sure there will be other ventures which -- where we'll see, maybe we can go in and make a difference.
(END VIDEOTAPE)
QUEST: Sir Richard Branson, submarines and space.
Some news into the network. In the last half hour, a tsunami warning has been issued for Sumatra, according to the Reuters News Agency. It follows a 7.3 magnitude earthquake that hit off the Indonesian island's northwestern coast. Let's go to Jennifer Delgado at the World Weather Center.
So, let's take this bit by bit, slowly, if we may. The earthquake that was reported when? And what are we now hearing on the tsunami warning?
JENNIFER DELGADO, CNN METEOROLOGIST: OK, well, we'll update you. We did get this report of the earthquake. It happened just after midnight local time. I can tell you this. I go back over to our graphic, here.
To give you an idea, we're talking in the northern Sumatra area. This is where Banda Aceh is. And the area in red, that is where the earthquake was. Again, as you said, a 7.3, but it was actually quite shallow, roughly about 29 kilometers.
Now, there's not a threat for a widespread tsunami, like what we saw happen in Japan, but we do have a threat for this coastal area right here, I'd say for about the next 15 minutes, that tsunami possibility would arrive all across that northern part of the region.
Again, the earthquake, the epicenter located about 200 kilometers off the coast of Sumatra, and the threat for that tsunami's going to be really within about 100 kilometers near that region.
Typically, when you see an earthquake this strong so close to this region, keeping in mind, this is in the Ring of Fire, certainly this brings a lot of warning for this area, because this areas right here has been home to many very strong, deadly earthquakes.
So, right now, we're not getting any reports of any damages across the region. And still no confirmation on whether or not a tsunami has reached that area, but there is that threat right along that coastal region as we go through about the next 15 to 20 minutes.
The Pacific Tsunami Warning Center watching that, and of course, we'll be following that as well. Richard?
QUEST: Jennifer, by my reckoning, it is -- well, not by my reckoning, I've just looked online -- 20 past 2:00 in the morning in Sumatra, so just about two hours since that earthquake, as you said. Please stay on duty for at least the next 15, 20 minutes and beyond and come back to me in any event before the program is out --
DELGADO: OK.
QUEST: -- whether we've heard that there is or whether we've heard that there isn't, we need to know.
DELGADO: We'll give you confirmation.
QUEST: Jennifer Delgado, I appreciate that.
Now, not content with being nicknamed King Eric by his fans, Eric Cantona is making a play to be president. It seems that for once, winning is not the point.
(COMMERCIAL BREAK)
QUEST: For years, he led the line as Manchester United enigmatic striker. For Eric Cantona, the next step was obvious: lead France as its president. He collected the signatures and his campaign was ready to go.
There was one problem. It turns out, it was much about publicity as politics, as Matthew Chance explains.
(BEGIN VIDEOTAPE)
MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): For a moment, it seemed Eric Cantona would reinvent himself once more. The 45-year-old soccer star turned amateur philosopher turned actor now turning to politics.
The Paris-based paper, "Liberation," had the scoop. In it, Cantona denounced social injustice in France and in this election year, asked for 500 signatures from French mayors, a requirement for presidential candidates.
But the Elysee Palace, it seems, is not Cantona's goal. The signatures were for a petition on securing better housing for the poor in France. One of the world's most enigmatic sportsman scoring a publicity coup for the charity he supports.
On the pitch as Manchester United's goal-scoring star, Cantona was no stranger to controversy, infamously performing this kung fu kick on a spectator during a game. It cost him an eight-month ban. The news conference afterwards sealed his reputation as an unpredictable would-be philosopher.
ERIC CANTONA, FORMER STRIKER, MANCHESTER UNITED: When the seagulls follow the trawler, it's because they think sardines will be thrown into the sea. Thank you very much.
CHANCE: It all fueled a cult Cantona following. He even played himself in a movie about one fan's obsession with his sporting hero.
STEVE EVETS AS ERIC BISHIP, "LOOKING FOR ERIC": It's funny, isn't it? Sometimes we forget that you're just a man.
CANTONA AS HIMSELF, "LOOKING FOR ERIC": I'm not a man. I am Cantona.
CHANCE: But the fame never translated into politics. His last idea in 2010, encouraging people to withdraw their money from French banks, was ignored. It may be different this time over housing, but to legions of soccer fans, he's Eric the King. Eric the President he may never be.
Matthew Chance, CNN, London.
(END VIDEOTAPE)
QUEST: "I am not a man. I am Cantona." Now, that's a quote if ever there was one. The French finance minister says at least Cantona's not bothering the banks anymore, talking of course, about his call a couple of years ago for there to be a run on French banks as people took their money out.
We need the help of a man who's -- who understands these things in France. And so we always turn to Christian Malard from TV 3. Thankfully, he's with us tonight.
Good evening, Christian. OK. So, should we be horrified that he did this, or delighted that he's raised the attention of the poor and the homeless? Which way does this one fall?
CHRISTIAN MALARD, SENIOR FOREIGN ANALYST, FRANCE 3 TV: Delighted, Richard, delighted. When a lot of politicians this morning, even members of Sarkozy's government, were asked the question, of course, everybody said Cantona's drawing the attention of the housing problem is great, we agree with him.
It's clear that Cantona makes now be sure that this sensitive problem is going to be one of the themes to be dealt with during the campaign between Sarkozy and Hollande.
Because it is clear that in France, in this country, where you have -- Richard, you know that better - 63 million people. One French out of six, 10 million French people, have housing problems. They are splitting their housing between slums in the suburbs of Paris or big cities, people living under tents near the River Seine or other rivers in the country, in the cellars. It's awful --
QUEST: Right.
MALARD: -- it's a big problem, we don't talk too much in this country.
QUEST: So, Cantona puts it on the agenda. If he's put it on the agenda, who stands to gain most between Hollande and Sarkozy? Who's basically going to either get the blame or the credit by the electorate?
MALARD: Well, it's definitely that both candidates will try to be in the wake of the proposal of Cantona's, of King Eric, as you called him. It's definitely -- it's clear that the French government's people this morning tried to say, "We have been doing a lot for housing problems since we have been in power five years go."
But I must admit that the two parties, socialist and right-wing parties, have really been neglectful concerning the housing problem in this country --
QUEST: Right.
MALARD: So, you will see. These two candidates, Hollande and Sarkozy, will try to move forward and say, "We are going to do this, we are going to promise." They have to make promises, but they have to hold the promises. If not, they will be responsible for having not held the promises, and people won't accept that.
QUEST: Is President Sarkozy getting credit yet for -- from the French public for being a partner with Angela Merkel, or is he now very much being painted as the supplicant, the person running behind her?
MALARD: Well, it is still true -- and you are right to put this question, Richard -- that Sarkozy is considered as still being the one running behind Angela Merkel. And even Hollande tries to use that and show that France is a very weak country, Sarkozy's a weak president with a weak government being behind and trying to cope with Mrs. Merkel's decisions.
So, it's going to be one of the things that probably Hollande will put the emphasis upon during the campaign to try to say, well, where is France? Are we still a big power? No. All -- Mrs. Merkel is the leader in Europe. Definitely will be in the debate in this campaign.
QUEST: Is it going to be -- we've got a -- luckily for us tonight, we have a second or two more than usual, so we can explore this finally. Is it going to be a good presidential election? You know how some years you really look forward to a big campaign where they fight it out. Other times, it's all a bit lackluster. At this stage, Christian, what's your gut feeling?
MALARD: My feeling, to be very outspoken, Richard, is that it's going to be a dirty, dirty, tough campaign. I would even say it might look that some of the very tough and dirty campaigns we have been attending sometimes in the United States, we have been following a lot of them, and if it's that, it's very bad.
People don't want that. Public opinion doesn't want that. They want decisions concerning sensitive problems, unemployment. You know about that. But I am afraid, the way it started until now, these people have been insulting each other, Hollande on the one hand, Sarkozy on the other hand. It will be, as I said, a dirty, tough campaign. We will see what's kept in store.
QUEST: Before we're finished, we'll all be saying, bring back DSK. Christian Malard joining us from a glorious night --
(LAUGHTER)
QUEST: -- a glorious night in Paris.
MALARD: All right.
QUEST: Many thanks, Christian. It's always good to have Christian to talk about these things. And one thing I can assure you as we, obviously, cover the French elections, Christian Malard will certainly be here to help us understand what's happening and to give us his unique perspective. Always worth it.
Now, the mere mention of the Consumer Electronics Show is enough to make any technophile salivate. Technophobes rush to the door. We'll be getting an update. Dan Simon is in Las Vegas where, if it's new and techie, somebody's going to show you how it operates.
(RINGS BELL)
(COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest.
More QUEST MEANS BUSINESS in a moment.
This is CNN. And on this network, the news always comes first.
Activists in Syria say 33 people have died in the violence, as President Assad delivered an address to the nation. The country's opposition says the address was, in their words, "worthless." Mr. Al-Assad said a referendum on a new constitution would be held in March and he railed against what he called external conspiracies, which he blamed for the turmoil.
In Nigeria, protesters angry over the government's cancellation of fuel subsides are on the second day of a nationwide strike. The Red Cross says at least five people have died in clashes in the southern city of Benin. There are also reports of vandals there burning a mosque.
Libya has been given more time to decide whether to hand over Saif al- Islam Gadhafi to the International Criminal Court. The court wants to try the son of the late leader, Moammar Gadhafi, on charges of crimes against humanity. Saif al-Islam Gadhafi was captured in November and has been held ever since in the Libyan city of Zintan.
A stampede at the University of Johannesburg has killed one person and injured more than a dozen more. Thousands of applicants had lined up for days hoping for a shot at admission. Many young South Africans see a university degree as the only way to escape poverty.
A lawyer for an American sentenced to death in Iran is calling for the case to be judged on humanitarian, not political, grounds. Amir Hekmati was convicted of spying. He has 20 days to appeal against his case. Hekmati, who is 28, holds dual U.S.-Iranian citizenship.
And in the U.S., Mitt Romney is expected to win Tuesday's Republican presidential primary in New Hampshire. Final polls there give him a 19 points lead.
The question, of course, who comes next?
A tsunami warning has been issued for Sumatra, Indonesia. According to Reuters. A 7.3 magnitude hit off the Indonesian Islands' northwestern coast a couple of hours ago.
It is either the most fantastic thing you've ever seen or something so dreadful, you want to run in the opposite direction. It's the Consumer Electronics Show. And it's in Las Vegas. Ingenious introductions and a mal -- and a major farewell.
Microsoft's chief exec, Steve Ballmer, delivered his swan song, saying the company -- this is the final time it will participate in the convention.
Dan Simon is testing out the gadgets.
He is in Las Vegas.
So which is it for you, something horrendous that you want to run out of time or -- good lord, is your microphone -- is your microphone gizmo actually moving?
Is this a new gadget that we're seeing?
DAN SIMON, CNN CORRESPONDENT: Well, it is. We're actually unveiling it for the first time on -- on CNN air, Richard.
This is a -- a video mike flag. This is from a company called the Recom Group. And, yes, let's just turn it around and you can see the different CNN logos moving here. A video mike flag, something new here at the Consumer Electronics Show.
You know, when you talk about whether or not I -- I want to run away or -- or be here at the CES Show, you know, it's a little bit of both. You know, it's the center of the technology world, so you want to be here. But it is a madhouse in here. It wouldn't be January without the CES Show.
And I just want to give you a test of some of the things you'll find.
Take a look.
(BEGIN VIDEOTAPE)
SIMON: To appreciate just how difficult it is to put on this show, just come outside and check out all the crates. This is the stuff from Mitsubishi right here. Behind us are the crates from Microsoft. And this is just a tiny fraction of the overall amount of equipment here in Las Vegas.
One of the big themes for this show is seeing all the accessories for smartphones and tablets. This is one of the more unusual contraptions we've seen. This turns your iPad into a guitar. This is a predict from Ion that will retail for $99 when it comes out this summer. And it teaches you how to play the guitar.
Panasonic is trying to give us a sense as to what cars might look like in the future. This is not a video game, but a vision to make driving safer and easier.
People might think of CES really as a place to unveil TVs and computers, but it's really a lot more than that. It's really for any product that requires batteries or electricity and is available to consumers.
We are at the Inada booth. And as you may have guessed, they sell message chairs.
This is another kind of appliance from LG. It actually looks like a refrigerator. But when you open it up, you're not going to see any food in there. You see clothes. They call this the Styler. It will sterilize your clothes, take out some odors, do some drying and also take out your wrinkles. No price yet and we don't know when this will be for sale.
In computers this year, it's all about ultrabooks -- thin, powerful laptops with long battery life. Virtually every computer maker is coming out with their own version.
Companies like Google and Apple don't come to CES. Instead, they hold their own events throughout the year. Microsoft has decided to go that route and says this will be its last year at the show. Which has some wondering whether CES is losing its clout.
BRIAN COOLEY, CNET: The big companies don't want to be on this show's schedule to say, OK, early January every year, we have to have the big product for the year.
But I haven't seen one new product that is a thing that we've never seen before, a behavior we've never seen before. And that's what everyone looks for. And this show gets a knock when it doesn't have one of those.
SIMON: But for smaller companies and start-ups, CES is still perceived as a must. Xybotyx is making its debut this year. And it makes a product that turns your iPhone into a robot.
DANIEL MCSHAN, XYBOTYX: We're just interested in being here and getting exposure. And I think, you know, the less other products announcements made, better off for us.
(END VIDEOTAPE)
SIMON: But, you know, Richard, people are definitely raising the question about whether or not CES is losing its mojo, so to speak, you know, the fact that Microsoft is pulling out and some of these big companies aren't coming here anymore to unveil their products.
But we should point out that most of the companies here at the show, they are smaller. It's not like they could hold their own event and -- and get a big crowd. So they still need to come to CES. And I don't see this show going away any time soon. It will definitely be around.
But -- but it's certainly losing a bit of its influence -- Richard.
QUEST: Dan Simon with the gadgets in Las Vegas.
Many thanks, Dan.
And I suspect the only gadget he needs is a good pair of shoes to walk around all the time.
From the consumer electronics to biotechnology -- sequencing the first human genome was a $3 billion task and it took 13 years to complete.
Today, U.S. company Life Technologies says it can do this for $1,000 at a time.
As the technology to map our DNA has become more affordable, it could herald an age of personalized medicine. It could let you know which diseases you're most likely to get and how to treat them. That is the theory that could be in your hands. The practical parts, if we could all get access to mapping our own DNA for the price of $1,000.
Earlier, I spoke to the inventor of the new technology called the Ion Proton.
He told me the machine isn't a medical crystal ball, at least not yet, anyway.
DR. M. JONATHAN ROTHBERG, INVENTOR, ION PROTON SEQUENCER: Our sequencer, for $1,000, will allow a researcher to read all the information in a patient's chromosomes. And what it will allow the researcher to do is understand their genome in terms of our current knowledge so they'll be able to select some drugs, they'll be able to understand potential outcome.
What it won't do is predict all of your future because, over the next three years, researchers around the world have to do large studies that relate an individual's genome to medical outcome, to response to medicine.
So this is the beginning of a quest.
QUEST: On the question of giving this very valuable tool into the hands and into the price point of ordinary people, well, you can immediately see -- and I know you've answered this a million times -- the question of how we handle that power.
ROTHBERG: We'll handle the power within the framework of our current medical practices, with the same kind of confidentiality that would be applied if I had done an HIV test or if I had an MRI.
So the important thing to know is that this is done within medical practice. It's done with people that are focused on confidentiality.
QUEST: Do we need new rules for how I deal with it?
ROTHBERG: I think we need to enforce the rules we have. Unfortunately, I understand this all too well because a cousin of mine, many years ago, was diagnosed with a rare genetic disorder, and she took her own life. So I probably understand more than most people the importance of this information, the importance of counseling with this information, the importance of the privacy of this information.
QUEST: How -- let's just...
(CROSSTALK)
QUEST: -- the ability of one person to feloniously and erroneously and mischievously take somebody else's DNA to find out something about it?
ROTHBERG: Well, I -- I think that's an excellent question. And my answer has changed over the last two years.
I was amazed to find, in the WikiLeaks disclosures, that the State Department from the United States was actually collecting DNA of all the diplomats -- of -- of people they met. So I guess two years ago, I would have laughed at the question, but now I recognize it is a serious question, it's a real question and it's one that I don't have a simple answer for.
QUEST: We now have a situation -- and it's not unique and you'll be well aware of it -- everything from step -- step -- from test tube babies onwards. But we do not have a -- a situation where technology is way ahead of ethics, way ahead of the legal framework, way ahead of our moral ability to handle this information.
And that, sir, is going to be the biggest issue.
ROTHBERG: I agree with you. I -- I do think it's important. What happened is things moved faster than we ever imagined. About 12 years ago, I came up with the idea of high throughput sequencing. A few years ago, we did the first individual with Jim Watson. Recently, we did it with Gordon Moore, the founder of Intel and the person that gave us semiconductors.
And Moore was the one that told us things are speeding up and you're absolutely right, we do have to train the generation of physicians, a generation of politicians in the implications of -- of this. It has happened at the -- beyond the speed of light, if you will.
QUEST: Finally, Dr. Rothberg, to some people, you will be a savior and a visionary. To other people, you'll be a menace and a nuisance that shouldn't be let out.
Which are you?
ROTHBERG: I'm focused on changing people's lives. So right now, this is a moment of history where we can understand the patient's cancer and give them the right drugs and develop better drugs. This is the moment -- I was talking to a physician at Yale two weeks ago, Matt State, who studies botism and is going to use our tool to understand botism.
This is a moment where we can do fantastic good for not only stranger, but for people that we know and love.
(END VIDEO TAPE)
QUEST: What a fascinating story. Oh, that can be in your hands and the power to know what your future may be. And it's all for $1,000.
More QUEST MEANS BUSINESS after the break.
(COMMERCIAL BREAK)
QUEST: The British government announced it is to spend $50 billion on extending its high speed rail network. Well, not much of a network so far. There's only one high speed line and that's used for the Eurostar. The new project will cut journey time and the government says it could generate more than $130 billion in revenue and investment.
Japan pioneered high speed rail. China has built the biggest network in the world.
And now Jim Boulden explains why governments are so keen to climb aboard the high speed rail event.
(BEGIN VIDEOTAPE)
JIM BOULDEN, CNN CORRESPONDENT (voice-over): Can high speed rail help speed up the British economy?
The government thinks so. It's given the green light to building a 140-mile line from London to Birmingham, in the middle of England, cutting the one hour and 24 minute travel time almost in half.
Though it will take more than a decade to complete just the first phase, supporters say it will be $50 billion plus well spent.
UNIDENTIFIED FEMALE: it will provide the capacity the passengers need. It will provide the connectivity that our major cities need. It will provide the speed between getting between those cities that our country needs. It will also create the job growth and prosperity that Britain needs in the future, too.
BOULDEN: High speed rail is far from an easy vote getter. Critics say it will be cheaper to upgrade existing lines and that the environmental benefits are, at best, neutral.
The Conservative-led government even faces a revolt from some of its own wealthy voters, especially those whose backyard will be home to part of the line.
UNIDENTIFIED MALE: it's about whether this is the right thing to do for U.K. PLC. And we don't believe it is the right thing to do for U.K. PLC at a time of national austerity.
BOULDEN: The U.S. Congress killed White House plans for high speed rail, citing costs and questionable economic benefits. But unlike the U.S., Britain already has a high speed rail line. Eurostar uses it for trains to and from Paris and Brussels. Europeans are quite used to bullet trains, as are the Japanese, and even more recently, the Chinese, tough there have been safety concerns in China. Governments see mega transport infrastructure projects as one big way to repair economic malaise.
UNIDENTIFIED MALE: large projects means large amounts of money spent, jobs created, temporarily, at least. And then temporary jobs means money in people's pocket and then they start spending. And the economy, hopefully, revives again.
So it's been done many times.
BOULDEN: As part of his Virgin empire, Richard Branson operates a fast train line in the U.K. and is worried this second high speed line, or HS2, will siphon all the cash.
RICHARD BRANSON, CEO, VIRGIN ATLANTIC: Our trains are capable of going 30 or 40 miles an hour quicker. We -- we would like improvements to the track. We would hate it if all this money went into HS2 and -- which is not -- which is not going to benefit people for 10, 15 years time.
BOULDEN: Britain equates high speed rail to the building of the highways, saying it's time to replace Victorian-era lines for people and for goods.
Jim Boulden, CNN, London.
(END VIDEO TAPE)
QUEST: Round two in the race for the Republican nomination. Voting is underway in the state of New Hampshire. And Wolf Blitzer will be with us after the break.
(COMMERCIAL BREAK)
QUEST: Now, there were two small villages who gave an overnight return and gave Mitt Romney a win and a tie in the New Hampshire Republican primary. A record 250,000 voters are expected to take part in the -- deciding the nomination contest. And the voting is set to go on for another five hours in the Granite State.
The latest round of opinion polls put Romney firmly in the lead. Ron Paul and Jon Huntsman battling for second place.
Wolf Blitzer joins me from the CNN Center in Atlanta -- Wolf, if we have to pull the -- we -- you know, we haven't even got one real result and we're already saying, so, what comes next?
But if we have to pull the strands together of where this goes after tonight, with a Romney victory, what happens next?
WOLF BLITZER, HOST, "THE SITUATION ROOM": Well, Romney almost certainly will win in New Hampshire and almost certainly win decisively. So that means he's won in Iowa, barely, by eight votes, over Rick Santorum. He'll win much more decisively in New Hampshire tonight.
They go on to South Carolina, where we're going to see what happens. A lot will depend on who comes in second and third in New Hampshire, to see how the stage is set for South Carolina. If Ron Paul does well -- and I'm sure he will do relatively well -- he'll be in a relatively good position to once again do well in South Carolina, although not necessarily win. In almost all of the recent South Carolina polls, Mitt Romney still is ahead in South Carolina.
This is do or die for Jon Huntsman. Assuming even if he comes in second in New Hampshire, he'll try to do something in South Carolina and then a week later in Florida. But it's going to be a tough struggle for Jon Huntsman.
Mitt Romney is in -- in -- in very -- in a very strong position right now.
QUEST: Right.
BLITZER: But one thing, Richard, we have to look out for, is Newt Gingrich, who was hammered by pro-Romney attack ads in Iowa, Newt Gingrich is getting ready to do exactly the same thing to Mitt Romney in South Carolina. And we'll see if that really makes a dent.
QUEST: All right, Wolf, this is a -- this is the -- the billion dollar question. Man of the world, are -- is this a real battle or is -- to -- to -- to bluntly put it, has Romney got this and we're just now really dotting the Is and crossing the Ts?
BLITZER: No, he doesn't have it yet. He's close but he doesn't have it yet. Things could still fall apart. But -- but he is well positioned to win the Republican presidential nomination and go on and challenge President Obama, who -- who's seeking a second term on November 6th.
QUEST: Right.
BLITZER: He still has to struggle in South Carolina and then in Florida. All of his rivals, they're going to be pounding and pounding and pounding against him. We'll see if that undermines him. We'll see if one of those rivals emerges as the non-Mitt Romney and poses a credible threat. It -- it -- but to put it in American terms, Richard, it ain't over until the fat lady sings and she has not yet sung, although a bunch of, let's say, robust women are out there getting ready to rehearse.
(LAUGHTER)
QUEST: I nearly forgot me last question after that one.
But no, I've remembered.
Who would the Democrats -- who would Obama really prefer to face in the general election, besides some of the loonier candidates, who may or may not have now gone to the -- off -- off the radar?
Of the mainstream ones left, who would he prefer to face?
BLITZER: All of my conversations with Democrats and Obama campaign officials and others in the White House, they fear Mitt Romney the most. They think he's the greatest potential threat out there to the president of the United States getting a second term.
As far as the other candidates are concerned, I suspect they would fear Rick Santorum and Newt Gingrich about the same. Rick Perry, you know, he's sort of in it, but he's probably not going to do very well. He'll do awful in New Hampshire, the governor of Texas, and probably won't do well in South Carolina, either.
So as far as Santorum and Gingrich, they're not really sure. But they're -- they're focusing all their efforts on damaging Mitt Romney as much as they possibly can right now, because they fear him the most.
QUEST: Wolf, the moment you see that fat lady about to sing, I suggest you get out of the way.
BLITZER: I agree.
QUEST: Many thanks, Wolf Blitzer, joining us from the CNN Center to bring us up to date on that.
We'll talk more -- a lot more about that over the next 24 hours, as those results come in.
Now, Jennifer Delgado is at the CNN World Weather Center -- Jennifer, we spoke about, I don't know, 20, 30 minutes ago, when we were just talking about Sumatra and you -- you updated us that that's when the tsunami warning had been given.
Any further developments?
JENNIFER DELGADO, ATS METEOROLOGIST: Yes, we do know, it looks like, if there was a tsunami, it would have actually reached the area by now.
What you're looking at in the orange dot, that is actually the epicenter, the 7.3. It happened about 1:37.
Now, let me give you an idea. It's located about 400 kilometers away from Banda Aceh on Northern Sumatra. And if you notice in the area in blue, this indicates very light shaking. So, again, when we talk to you about whether or not a tsunami would reach that area, to give you an idea, say from the epicenter all the way up toward Banda Aceh, that's 370 kilometers. The Indonesian government did issue the tsunami warning as a precaution, certainly, because it is a strong earthquake.
But keep in mind, any time there's an earthquake and you're in a coastal region, if you feel that earthquake, that is your warning. Don't wait around for local authorities. Get to safety.
So, again, we want to update you just to let you know, again, to give you an idea of some of the shaking there.
Now, the other story that we're following as I take you back over, the snow that's been coming down through parts of Turkey, it's been coming down quite heavy. And we talked about yesterday how it's been falling in the Alps. What you're looking at right now is a low. And it's pulling in all that moisture from the Mediterranean Sea.
Let me show you what it looks like coming out of the sky. Some video coming out of Turkey. And this is actually coming out of the region.
And what you're looking at is people walking through streets. They're going to continue to see more of that snow as we go through today. This is at Ankara. And with this happening, this is certainly going to cause travel delays. If you're in the car or if you're trying to fly out for today, as well as tomorrow.
As I take you back over to our graphic here, we're talking 25 centimeters to some of those locations, especially in those higher regions. And we're also talking about for Georgia, as well.
So there is snow out there. But over in London, things are nice and quiet.
But, Richard...
QUEST: Yes, but.
(CROSSTALK)
DELGADO: -- right now.
QUEST: No, no, you see.
DELGADO: That really (INAUDIBLE).
QUEST: I was in Istanbul this weekend. I was in Istanbul. And I tell you, from the moment the plane landed until the moment it left was solid rain.
DELGADO: Oh.
QUEST: Jennifer Delgado...
DELGADO: I'll take rain.
QUEST: -- we thank you for that.
Absolutely. Better the rain over the snow.
A Profitable Moment on DNA, after the break.
(COMMERCIAL BREAK)
QUEST: Tonight's Profitable Moment.
The human genome project is one of mankind's greatest achievements. And earlier tonight, we told you about Life Technology's plans.
And you could understand the excitement, to map out the DNA for just $1,000 a time. You and I can go along with that. A process that once cost $3 billion, what possibilities are opened up.
Well, not all of them are ones we feel comfortable with.
Who would ensure me if they know that if I get a disease?
Who will hire me if they know the limits of my potential?
Why should I even keep working doing this if I know when I'll die?
We're privileged to live in a world where technology moves this fast, even if ethics and models are now outpaced by this innovation. It's no disaster, it's a challenge. And like most great advances, these projects will be viewed with suspicion. And like most great advances, we must work on their potential to change our world for the better.
And that is QUEST MEANS BUSINESS for tonight.
I'm Richard Quest in London.
Whatever you're up to in the hours ahead, I do hope it's profitable.
The news continues.
This is CNN.
END
