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Quest Means Business
Facebook's $96 Billion Friend Request; US Jobs Disappointment; US Stocks Slide After Jobs Report; European Markets Down; Jobs Worries; Yahoo CEO Has Wrong Degree on Resume; European Currencies Down; French, Greek Elections Could Shake Rocky Eurozone; Remembering Elderly Greek Suicide Victim as Greek Suicide Rate Climbs
Aired May 04, 2012 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MAX FOSTER, HOST: Facebook's $96 billion friend request. The investor road show is about to begin.
Slow going in the US. The pace of hiring weakens.
And in France and Greece, the final push for votes. We'll be live from Paris and from Athens.
I'm Max Foster, this is QUEST MEANS BUSINESS.
Hello to you. Facebook is looking for friends with very deep pockets. The world's top social network wants investors to stump up 99 times its earnings.
When it makes its market debut in around two weeks' time, Facebook will offer shares of up to $35 each. That would value the company at up to $96 billion, making it the biggest tech IPO in history. CNN's Dan Simon joins us now from California. Dan, when exactly is the company likely to go public?
DAN SIMON, CNN SILICON VALLEY CORRESPONDENT: Well, we're looking at March -- or May 17th, May 18th, next 10 or so business days. And this is really an historic watershed moment for Silicon Valley. Not since Google has there been this much buzz for a technology company going public.
They're expected to raise somewhere in the neighborhood of $10 billion, and Mark Zuckerberg and fellow executives, they put together a video for these well-heeled investors to take a look at, and here's some of what Mr. Zuckerberg had to say.
(BEGIN VIDEO CLIP)
MARK ZUCKERBERG, CEO, FACEBOOK: I think that we're going to reach this point where almost every app that you use is going to be integrated with Facebook in some way because the developers of those apps are going to want to make it so that you can interact with your friends and that you can share contact back to Facebook to help grow those apps. And it's a very symbiotic relationship.
So, we make decisions at Facebook not optimizing for what is going to happen in the next year, but what's going to set us up to really be in this world where every product experience that you have is social, and that's all powered by Facebook.
(END VIDEO CLIP)
SIMON: Now, the price of an IPO share is expected to be anywhere from $28 to $35. That's for these well-heeled investors who can gobble up a bunch of these shares.
For retail investors, it's an open question. Obviously, the price of the share will skyrocket on opening day, so for average investors, what they'll be able to buy a share of Facebook at remains, really, an open question, Max.
FOSTER: Assuming Mark Zuckerberg wants to see the share skyrocket, I'm sure he does, why, though, is he selling shares? That doesn't look very encouraging from other investors' point of view?
SIMON: Well, because of his enormous stake in Facebook, he's going to be looking at a pretty big tax bill. So, according to the company, he is unloading a lot of shares so he can afford the tax bill.
In California, the state which has been facing a chronic deficit problem, is going to be getting a lot of money, just shy of $200 million in tax money, that's just here in California, and Uncle Sam, the federal government, is going to be getting more than $700 million from Mark Zuckerberg. So, there is a lot of money to be passed around, and it's going to benefit the state of California.
FOSTER: Yes, good news for him, good news for California, I guess. But he's very confident, isn't he, about Facebook and its future? But what would you say are its challenges going ahead, because it's not always easy being at the top, is it?
SIMON: Well, the challenges are really growing the user base and getting more advertisers to sign on. At a certainly point, do you reach a saturation point? Are there no more users to be gotten?
In terms of advertisers, they really need to convince people who want to spend money on Facebook that people who see these ads are actually going to buy their products. At this point, that's really an unproven formula, unlike Google.
And so, for Facebook to continue to gain the confidence of investors, they're really going to be able -- they need to show that they can increase their revenues and attract more advertisers, Max.
FOSTER: And in terms of individual personal investors, what are they going to get out from putting their money into the company, do you think?
SIMON: Well, they get to own a piece of Facebook. And for a lot of people, it's just that idea of getting in on a company very early. We saw the same thing with Google back in 2004. Some investors were a little hesitant to invest in Google, and obviously, that's been paying dividends in a huge way.
What we think is going to happen is that Facebook will allow the average investor, retail investors, if you will, to be able to buy, perhaps, a share at an IPO price.
There are some reports that maybe 25 percent of the allocated shares may go to the average investors because Facebook realizes that it's the people, the people around us, average people, who made Facebook a success. So, to allow them to benefit from the riches, if you will, may be a big priority for the company.
FOSTER: OK, Dan Simon, thank you very much, indeed, for joining us live from California. Now, after the break, the US jobs market is giving up on growth. Why more and more Americans aren't even trying to find a new job.
(COMMERCIAL BREAK)
FOSTER: Jobs creation has slowed up in the United States for the third straight month now, and the jobs picture is now so bad, more and more people are simply giving up on the search. Overall, the US economy added 115,000 jobs in March.
The unemployment rate fell just a little, down to 8.1 percent, but that's only because hundreds and thousands of workers stopped looking for work altogether. In fact, only around 63 percent of adults are even in the jobs market right now, the lowest level for more than 30 years.
These numbers could have a major effect on US president Obama's reelection campaign. The president told a rally in Virginia that more work is needed to create jobs.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: If we're going to recover all the jobs that were lost during the recession, and if we're going to build a secure economy that strengthens the middle class, then we're going to have to do more.
And that's why next week, I'm going to urge Congress as they start getting back to work to take some actions on some common sense ideas right now that can accelerate even more job growth. That's what we need.
And my message to Congress is going to be just say no to ideas that will create new jobs is not an option. There's too much at stake for us not to all be rowing in the same direction.
(END VIDEO CLIP)
FOSTER: Bad news for Obama, bad news for investors, as well, if you look at the figures. Alison Kosik is at the Stock Exchange to bring us up to date on that.
ALISON KOSIK, CNN CORRESPONDENT: Yes, you can say that again, Max. We're seeing the Dow slip 160 points. Even though this wasn't such a huge surprise, Wall Street was bracing for a disappointment, clearly investors not happy.
They are selling their positions after hearing about that 115,000 jobs added to the economy in April. The fact is, it's just not good enough to dig the jobs market out of the hole that it's in from the financial crisis.
Even the tough economy -- even though, rather, the economy has been adding jobs, the additions have slowed with each passing month. January started pretty strong. There was a gain of 275,000 jobs. Now with April, that's less than half of that.
As I said, it's not such a huge surprise. There have been other signs lately that the recovery is losing steam. GDP activity in the service sector both have showed that they've been slowing down. Plus, a dozen countries in Europe are back in recession, so naturally all of that trickles right through to the jobs market.
Now, you noted that steep drop in the labor participation rate, and the problem with a low participation rate in a labor force is that that hits tax revenue. It makes it harder to fund social security and, ultimately, it hits US economic growth. Max?
FOSTER: Alison, thank you very much, indeed, for that. Well, stocks also suffered here in Europe. Commodity-related shares performed terribly.
In London, copper producer Kazakhmys dropped more than 6 percent. E.ON fell 7.5 percent in Frankfurt, and energy company Alstom dropped more than 4 percent in Paris. Transocean was the worst performer in Zurich, and shares in the offshore drilling company dropped more than 5.5 percent, outpacing today's 3 percent drop in crude prices.
It's been a bad week overall for Europe in stocks, all of these indices have fallen sharply since last Friday's close.
There are serious questions, now, about the state of the jobs market in the US. Jonas Prising is the president for the Americas for Manpower Group, and he joins us now from Milwaukee. Thank you very much, indeed, for joining us. The concern here is this --
JONAS PRISING, PRESIDENT OF THE AMERICAS, MANPOWER GROUP: Thank you.
FOSTER: -- this element of the report that came out today that shows that people are giving up on looking for jobs, and that sort of pessimism is something that takes us into the long term, isn't it? And it's a long- term problem.
PRISING: Yes, I think the disappointing April month shows that both the job creation has slowed down and, as you correctly point out, the workforce participation rate is at a very low level. It's the lowest level that we've seen in 30 years here in the US.
But the factors behind that workforce participation rate decline can be a number of different things. Part of it is certainly the changing demographics of the US workforce. So, we have an aging population, more baby boomers are reaching eligible retirement age, and they may just opt out and say that they've worked enough. So, that could be part of the issue.
Another part of the issue, as you correctly point out, is that people are discouraged and decide that their chances of getting back into the workforce are so low and that there is no point in them even trying anymore. And if that's the case, if it drags on for too long, those people will have a difficulty getting back into the labor market in the long term.
FOSTER: And that's a hugely damaging thing for any economy, that sort of long-term unemployment problem, because those people are so hard to get back into the workforce when things pick up.
PRISING: Yes, that's exactly right. That is where you see the issues of -- the effects of when you have a cycle, economic cycle, so cyclical unemployment creating structural unemployment. And as we saw in this month's numbers, 41 percent of those unemployed have been unemployed for more than six months, which is a very high number.
And as we know from other regions of the world, notably, Europe, once you have a structural unemployment of long-term unemployed, it is very difficult to get that back down into manageable levels.
FOSTER: Have we got that now? Is it a structural unemployment problem?
PRISING: I think we are staring to see that some of the areas are certainly going to be very difficult to eradicate. But remember, as you can see from our growth rates here in the US, it is still a relatively anemic recovery, and we are certainly also feeling the effects of very low demand for products and services.
So, I think right now, we are still feeling primarily the effects of the economic cycle. But we know from experience that long-term unemployed is going to cause structural effects.
FOSTER: You could argue that one person that may benefit from this report is Mitt Romney, because he's really campaigning, isn't he, on his economic credentials? And it's going to work against Obama, any sort of effect to the economy.
Today, he said this, "This is way, way off from what should happen in a normal recovery. We seem to be slowing down, not speeding up." But is he right to even be talking about a recovery, because we're not in a recovery, are we?
PRISING: Well, I think if you -- whichever part of the political spectrum you're from, you're going to be playing this in a different way. Mitt Romney focuses on the fact that the job creation on average the last couple of months has been lower than the first two months of the year to a relatively significant degree, 265,000 jobs were created in the first two months, 135 is the average now.
At the same time, look back only nine months, and the unemployment rate was 9.1 percent, it's down now to 8.1 percent. Clearly the workforce participation rate has a big effect into that, but the Obama camp will be able to claim that whilst it's not going fast enough, at least there are jobs being created.
And since the depth of the recession where we lost 8.8 million jobs, 3.7 million jobs have been created. So, the labor market is improving. It's just improving at a glacial pace.
FOSTER: Jonas Prising, thank you very much, indeed, for joining us on the program.
Well, for those Americans who do apply for jobs in the future, don't make the same mistake as Yahoo's CEO. The company says it's investigating after Scott Thompson was found to have a different degree on his resume from the one he actually sat.
Thompson claimed to have a bachelor's degree in accounting and computer sciences. A group of shareholders then revealed the degree was really only in accounting. Yahoo said the confusion was an inadvertent error on Thompson's part. The company says it will report to shareholders once it's reviewed the matter.
Time for a Friday Currency Conundrum for you. When Joseph Mobutu was forced from power in Zaire, now known as the Democratic Republic of Congo, the country was left with the old leader's face on all its bank notes. The question is, what did they do with them?
Did they A, burn them all and replace them with a new currency, B, punch out his image from the notes, or C, suspend the currency and use American dollars until a new one was found. And we'll tell you the answer to that later in the show.
As for today's currency numbers, the euro is at its lowest point against the US dollar for three weeks. The central currency is down around half a percent right now, as is the Swiss franc. The British pound is off by around a quarter of one percent.
(COMMERCIAL BREAK)
FOSTER: This weekend's elections in France and Greece threaten to undermine project eurozone. A change in government looks likely in both countries, and that could blow apart bailout agreements and unravel the fiscal pact, some are saying. Hala Gorani is in Paris, and Matthew Chance is in Athens.
First of all, Hala, we've got one last poll, which gives us the best sense, I guess, going into this weekend.
HALA GORANI, CNN INTERNATIONAL CORRESPONDENT: Yes, it does, and the candidates are still about six percentage points apart in the last poll that was conducted in association with BFM TV, our affiliate.
So, Nicolas Sarkozy is still trailing behind Francois Hollande. It's been the case, really, since October. Not a single poll has produced a result in which Nicolas Sarkozy wins in the second round according to all the various surveys conducted.
So, the real possibility that France will have a socialist president poses the question: what will it do to the budgetary pact that Nicolas Sarkozy signed with Angela Merkel to try to save the eurozone and try to save the common currency, the euro.
Now, one of the things that could occur -- and I spoke to the campaign manager for Francois Hollande -- is that they would negotiate for more growth in that austerity pact in order to ensure that at least some countries would be able to benefit from a little bit more government spending, so that instead of just budget cuts, leading possibly to the stalling of economic growth in this region, you could see a little bit more growth.
But in order for that to happen, of course, Max, as you know, you have to pay for it, and the Francois Hollande camp is saying that that could come with various mechanisms in the eurozone, including euro bonds, which Francois Hollande is in favor of, but Angela Merkel is not. As well as, in the case of France, some tax increases on the richest French citizens, Max.
FOSTER: Hala, thank you very much, indeed, for joining us from Paris. We'll hear from you throughout the weekend, of course, and tonight. But Matthew in Athens, what's the mood like going into that election?
MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: It's pretty pessimistic, Max, I have to say. You speak to ordinary Greeks and they've lost all sorts of faith with the politicians that have led the country into this economic crisis.
The main political parties have been staging rallies over the course of the past two nights. PASOK, which won the election back in 2009, had a rally just outside this hotel in the past few hours. Only a few thousand people turned up which, for a national party, is quite significant.
So, we are witnessing this major shift taking place in Greece at the moment, away from these parties that have led the country since the end of its military dictatorship back in 1975 towards more fringe parties, parties like the Neo-Nazis, they're polling around 5 to 10 percent in opinion polls at the moment. The hardline left-wingers, as well, are also, although they're splintered, are expected to do very well indeed.
Now, no one's expecting, Max, the extremists to take over in Greece. The main parties are expected to be able to pull something off and form a coalition again, but it's going to be a much weaker coalition before, and they're going to be confronted with many more anti-austerity voices in that parliament building behind me.
FOSTER: And is, Matthew, a lot of this very -- this political talk actually quite abstract for a lot of people living in Greece? Because things have gotten so bad economically that they're just trying to live from day to day.
CHANCE: It is. And in some cases, not succeeding. It isn't just the political crisis. It's not just an economic crisis. It's very much a social crisis, as well.
We've seen people lose their jobs. Unemployment is running nationally at over 25 percent. We're seeing people with their pensions slashed to the extent that they can't even buy food every month. We've seen people really face dire economic consequences. The impact of that has been quite destructive.
The government acknowledges that suicide rates, for instance, have grown by 40 percent over the course of the past two years. We've spoke to independent counselors in Athens over the course of today. They say the rate of suicide is actually much, much higher than that, that perhaps it's doubled over the course of the past year, they say.
And so, a real significant change happening here, and it's all been under the surface up until now, but last month, of course, there was that very high-profile suicide in this square right behind me, which really shook the nation.
(BEGIN VIDEOTAPE)
CHANCE (voice-over): As economic despair grips Greece, this is one tragedy still tormenting its people. Dimitris Christoulas was a 77-year- old pensioner who stood in front of the country's parliament and shot himself. It was, he wrote, his only dignified way out, or else rummage for food in the garbage.
CHANCE (on camera): Well, this is the spot in the center of Athens where Dimitris took his own life. You can see this tree, still adorned with flowers and mementos and, of course, messages of condolence and support.
This one says, "These are the criminals who are responsible for your death, the leaders of the gang." It goes on to name some of the most prominent politicians in Greece. Papandreou, Papademos, Venizelos, and Samaras, who was expected to do well in the forthcoming elections.
Another one here is from the town of Karditsa, his hometown in central Greece, saying "Karditsa will never forget you."
There's a nice one over here from someone from Thessalonika in the north of Greece saying that, "I've come here to tell you that your death is not in vain and that we will continue to fight."
MILTIADES PASCHALIDES, FRIEND: He was not sick, he was not dying. OK, he was old. He had nothing to lose. And that's --
CHANCE: He was desperate.
PASCHALIDES: He was desperate.
CHANCE (voice-over): Friends say he was sending a clear political message.
PASCHALIDES: He's not the same. If you do the same thing in front of the parliament, protesting that, "You are doing this to me. I have no other way to express the injustice that you did to me and to all the people, and I want to -- I want you to see this."
CHANCE: But this is no isolated death. In the offices of this charity suicide help line in Athens, counselors talk of an epidemic sweeping the country. Suicide rates have doubled, they told me, because of the Greek economic plight.
ARIS VIOLATZIS, PSYCHOLOGIST, KILMAKA.ORG: The society, the economic recession, the economic catastrophe we are experiencing have given the rise to the problem of suicide.
CHANCE (on camera): So, the economic hardship, the austerity measures, the cutbacks, the unemployment, that's responsible. It's fueling the higher rate?
VIOLATZIS: Definitely.
CHANCE (voice-over): And many Greeks fear even greater economic hardship ahead, a future with little hope, filled with despair.
(END VIDEOTAPE)
CHANCE: Well, Max, that counseling service, Kilmaka, I spoke to earlier today in Athens, they gave me a statistic, which is quite interesting, that a year ago, they say, they were getting about five calls every day, with people quite desperate and thinking about suicide and they were talking them down. Now, they say, every day, they get more than 100 calls, day in, day out, Max.
FOSTER: Matthew, thank you very much, indeed. We'll be back in a moment.
(COMMERCIAL BREAK)
FOSTER: Welcome back, I'm Max Foster, these are the main headlines today.
The US Secretary of State says she is encouraged by signs that China could let an escaped dissident leave the country. China said earlier that Chen Guangcheng is welcome to apply for a passport to study abroad, and right now, Chen is under close guard in Beijing hospital, but the US is maintaining contact with him.
Protesters and police have clashed again in Cairo. Police fired water canon and teargas at demonstrators on Friday outside the Defense Ministry. The protesters fought back with rocks, and dozens of people have been hurt. The demonstrators are furious about street clashes on Wednesday that killed at least 11 people.
Opposition activists say at least 37 people have been killed in Syria on Friday as government troops shot and shelled protesters. The violence is raising new doubts about any compliance with the peace plan brokered by UN envoy Kofi Annan, and his office says it will take time, and the plan is, quote, "on track."
The French presidential campaign comes to an end at midnight on Friday local time, and both candidates are still busy trying to sway undecided voters. A final opinion poll from CNN affiliate BFM TV shows that President Nicolas Sarkozy is trailing Francois Hollande by six points.
Former media tycoon Conrad Black faces deportation after his release from a Miami prison. Black served a total of 42 months behind bars after being convicted of fraud and obstruction of justice in 2007. He's not a US citizen and is now in the custody of US immigration officials.
(MUSIC PLAYING)
FOSTER: Well, this year Samsung rocketed to poll position beating Nokia as the world's top selling phone maker. Samsung is hoping the third generation (inaudible) flagship Galaxy S smartphone will make sure it stays there. (Inaudible) London the S3 sports the largest screen than its predecessor, more processing power and a longer lasting battery. Our Jim Boulden was there as Samsung lifted the lid.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: The Samsung Galaxy S3.
(APPLAUSE)
JIM BOULDEN, CNN CORRESPONDENT: How important is this new smartphone for Samsung? We've heard so much about it, so many rumors that now it's finally coming out.
STEPHEN TAYLOR, SAMSUNG: Well, it's clearly important. I mean, we have had such success with the Galaxy S2. And I think, as you know, there's been a lot of buzz around what the S3 was going to be. And I think what we've seen and what you've been shown is something that's truly amazing.
BOULDEN: Give us some of the ideas of what changes between the 2 and the 3.
TAYLOR: I think one of the fundamental things is from the hardware side of things, as you'd expect from Samsung. We've taken a leap forward. So all the functions of the products have been improved dramatically versus the S2.
I think the Avid thing's really got us excited is that the interaction with the phone, the whole way that the phone can actually listen to you, it will actually interact with you and it can anticipate some of your needs. This is a genuine wow about the product.
BOULDEN: Now, obviously, smartphones have so many widgets and gadgets now. Do you think -- sometimes it's too much. I mean, it's a lot for people to absorb. There's i-recognition, there's (inaudible) enhanced voice recognition, front and back cameras. There's HD video, there's all the near field communication, I mean, it's a lot to get people to be able to learn how to use.
TAYLOR: Sure. But I think the important thing is actually making sure that that interface is intuitive and simple, and I think that's a lot of what the new Galaxy S3 is able to do.
BOULDEN: Well, that's the view from Samsung. Now let's hear from (inaudible) tech expert, Will Findlater from "Stuff" magazine. What's your first impression of the phone?
WILL FINDLATER, "STUFF" MAGAZINE: I'm really impressed with it. The first thing you notice is that huge amyloid (ph) screen and it really is. It's amazingly crisp. It's a proper HD resolution.
BOULDEN: Obviously the Galaxy S2 was a game changer for Samsung, and now they've become a dominant player, the dominant player, some say, in the smartphone market. Is this a huge leap forward for Samsung? Is this just going to solidify their dominance in this market?
FINDLATER: I think that this is more about solidifying, that the S2 was the phone that really changed things for them, because until then, certainly from "Stuff's" point of view, the iPhone was the go-to smartphone. The S2 certainly leveled the playing field a bit. Suddenly Android seemed like a real contender.
BOULDEN: And a quick thought on Nokia and on BlackBerry, I mean, two struggling companies, struggling mightily. Do they have a chance to get back in the game? Or does Galaxy, Samsung made it even harder for them?
FINDLATER: It's certainly upped the ante once again. But it's going to be very interesting to see what happens with Windows, because Nokia's now in bed with Microsoft and (inaudible). It's a lovely operating system.
It doesn't seem to have really worked out for them yet. But when Windows 8 is out and suddenly you have these two really compelling screens working together, that might really work in Nokia's favor. The iPhone 5 is going to be very, very interesting, too.
iPhone is going to remain popular, no doubt about it. Android attracts a slightly different audience. But specification wise, there's nothing on the market quite like this at the moment.
BOULDEN: We do know from Samsung that it'll be launched in Europe and in other major cities around the world on May 29th -- Jim Boulden, CNN, London.
(END VIDEO CLIP)
FOSTER: He loves his gadgets. Now thousands of fans in remote location and one 81-year-old celebrity headliner. That's the man we're talking about. It is Berkshire Hathaway's annual meeting (inaudible). And this year things could get extra --
(COMMERCIAL BREAK)
FOSTER: Earlier on the show, we asked you what happened to banknotes in Zaire (inaudible) Democratic Republic of Congo after Joseph Mobutu was ousted from power? The correct answer, B, his face was punched out of the notes, part of the government (inaudible) actually had holes in them for some time.
Now they call it the Woodstock of capitalism, each and every spring thousands of investors pitch up in Nebraska to hear Warren Buffett speak at the Berkshire Hathaway annual meeting. But for the first time in the company's history, Buffett will be taking questions from analysts. And as Poppy Harlow reports, there's plenty for him to answer.
(BEGIN VIDEO CLIP)
POPPY HARLOW, CNNMONEY.COM CORRESPONDENT (voice-over): Just like baseball and barbecue, an annual rite of spring kicks off this weekend in Omaha, Nebraska, as thousands of Berkshire Hathaway shareholders gather to hear from legendary investor Warren Buffett.
Between the parties and Buffett's annual showmanship, there will be serious talk about the 81-year old's health. Buffett recently disclosed that he's been diagnosed with stage I prostate cancer. That's certain to prompt more questions about Buffett's succession plan for Berkshire Hathaway, the diversified holding company that owns businesses from Dairy Queen to GEICO.
CLIFF GALLANT, KEEFE, BRUYETTE & WOODS: He's put together a great group of companies, some companies with some fantastic long-term franchise value that produce a lot of cash and are going to be around for a long, long time.
HARLOW (voice-over): Buffett acquired Berkshire 47 years ago, and built it into the mammoth it is today. His name is synonymous with the company, but it's a question of how much one matters to the other.
GALLANT: Berkshire has grown to be such a big company that the ability of any one individual to greatly move the needle is a lot -- has been diminished over time.
HARLOW (voice-over): Buffett has chosen a successor, but hasn't made the name public. You can bet the 35,000 people expected to attend the annual meeting want to know who that is.
GALLANT: Well, no one knows for sure. Buffett has an unusual strategy where he's told -- he says he knows. He's told the board, but he hasn't even told the successor yet. And he's splitting up the company. He's going to give the investing portions and the operating portions to different people, something he all does now.
HARLOW (voice-over): Buffett's son, Howard, will be Berkshire's non- executive chairman. But the next CEO will have to manage a complex set of businesses. In recent years, Buffett has bet big on railroads, oil and gas exploration and banking to beef up the Berkshire portfolio. Long-time investors have been served well by Buffett and his co-captain, 88-year-old Charlie Munger.
UNIDENTIFIED MALE: Well, as long as Mr. Buffett is at the helm, I think that shareholders will do well, and I think the world will be a better place.
HARLOW (voice-over): A $9,000 investment 20 years ago would have bought you one share. Today, that share is worth $122,000. Beyond the returns investors and the media are glued to Buffett's predictions about the economy, the stock market, politics and pop culture.
Despite his recent diagnosis, Buffett says he's feeling great, great enough to put his own likeness on a pair of tennis shoes, a symbol of his endurance and his marketability.
BUFFETT: (Inaudible).
HARLOW (voice-over): Poppy Harlow, CNN Money, reporting.
(END VIDEO CLIP)
FOSTER: He's a pretty cool guy, isn't he really for his age.
Jenny Harrison over there at the Weather Center. And you're going to give me some good news. I have a rare back holiday off. So I've got a long weekend --
(CROSSTALK)
JENNY HARRISON, CNN METEOROLOGIST: (Inaudible) --
FOSTER: -- and you're going to tell me it's going to be glorious.
HARRISON: Yes --
FOSTER: (Inaudible).
HARRISON: -- I'm not. Hey, you've got three days off, you know, you can't have it all. But you've got three days off. How delightful.
Well, as for the weather, Max, I'm afraid it's sort of more of the same, really. We're still seeing this rain across much of western and northwestern Europe. You can see here in the last few hours, in fact France has really been taking the brunt of this weather. We've seen a real rash of thunderstorms, some of them really heavy, as you can see, some large hail also has been reported, 2 centimeters and that's enough to do a little bit of damage.
Of course, (inaudible) warnings in place because this system will continue to work its way from west to east, at the same time a front is sliding down from the north. So ushering in all of that sort of cool air. Still warm across more central and eastern areas, but really the rain and that cold front rather takes over.
So yes, not a great weekend ahead, I have to be said, and (inaudible) warnings for more of those thunderstorms. So think (inaudible) across the east, and we'll see more of those as we continue into Saturday morning. What does it mean for France as we head into the weekend for the election on Sunday?
Well, we've seen, as I say, some pretty heavy thunderstorms in the last few hours. And there's really just more rain in the forecast as we go through the weekend, even Marseille this time around, which last time around managed to stay dry. Most of the country saw quite a little rain and even some thunderstorms, even this time Marseille will see some showers.
Probably the only area that going to see some dry weather on Sunday itself is north and western France, because that system coming in from the west, it is gradually easing as it works its way eastwards. But at the same time, because it's pushing east, it's taking away that very warm air.
So the temperatures have certainly dipped -- look at that, Thursday to Friday in Budapest, a drop of 10 degree Celsius, still above the average. But you can see the general trend there to temperatures. There's the warm air pushing eastwards, and that cold air, as I say, filtering in from the north.
So Kiev one of the few places staying dry and sunny and above average as we go through the next few days. By Monday, the sunshine should return as well. And you can see that rain pushing in from the west and still snow across and into Norway and Sweden as well, some very heavy amounts, but mainly up to the north, as you can see. But even so, pretty late for snow across that area.
And some delays on Saturday as well at some of the airports, not particularly lengthy ones, just winds picking up in Stockholm on Saturday evening and some rain pushing in to Moscow as well. So temperatures for Saturday just 10 Celsius in London and Glasgow and just 17 in Madrid.
Now meanwhile across in the United States, again, we're seeing quite a few showers and thunderstorms here. For a time there were some warnings, one box has popped up again for some severe thunderstorms.
And then there's been quite a lot of damage in the last few hours. Iowa had tornado reporting some very heavy amounts of rain, certainly into Flint in Michigan, 142 millimeters, 78 is the monthly average, and that came down in just a matter of hours. Still warm and humid in the South, so that's why we're going to see more of these severe storms across these northern areas.
That Friday into Saturday, Sunday, it's happening Sunday, they continue eastward. And you can see also quite a few showers expected in the forecast, for of course, the Kentucky Derby on Saturday. All eyes will be on Churchill Downs, where again there's a chance of some rain and thunderstorms, about a 40 percent chance, but temperatures up to about 29 degrees Celsius, which is pretty average for this time of year.
Elsewhere it is warm and muggy, 13 (inaudible) and 34 in Dallas. So cool, bit of a damp weekend for you, Max, but just remember, three days off. It'll be great.
FOSTER: Thank you. I hope it will be. Well, when you get these back holidays off in this business, isn't it? But you know, (inaudible). Jenny, thank you very much (inaudible) great weekend.
We're going to have a look at the Dow, because pretty negative today, and it's all about jobs, because job creation has slowed, we heard today, in the U.S. for the third straight month, and the jobs picture's now so bad more and more people are simply giving up on the search and that's leading to structural employment (ph).
Overall, the U.S. economy added 115,000 jobs in April. The unemployment rate fell just a little, down to 8.1 percent. Thank you for watching. That is QUEST MEANS BUSINESS. I'm Max Foster. MARKETPLACE AFRICA is next.
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ROBYN CURNOW, CNN HOST: You're watching MARKETPLACE AFRICA. I'm Robyn Curnow. Now it's been called an epidemic. Some believe it's caused Africa to lose 25 percent of its wealth. The problem is corruption.
Now with the recent jailing of a former Nigerian state governor in the U.K., London's role in Africa's corruption has been exposed. Well, Jim Boulden now reports on the case and a small team within the British police who are trying to stem the illegal flow of Africa's wealth.
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JIM BOULDEN, CNN CORRESPONDENT (voice-over): James Ibori was the governor of the Delta state in Nigeria. He was accusing of committing massive fraud and money laundering. Though his state has oil wealth, his official salary was tiny, just $6,000 a year. He pled guilty to stealing some $80 million. Investigators believe he may have stolen triple that.
Ibori met his fate earlier this year, not in a Nigerian court, but in Southwark Crown Court in South London. It took seven years for U.K. authorities to put Ibori in prison.
One part of London's metropolitan police force is a tiny group of a dozen or so detectives making up the Proceeds of Corruption unit. Its specific task is to follow the money of foreign politicians flowing through London, headed up by Detective Chief Inspector Jonathan Benton.
DETECTIVE JONATHAN BENTON, LONDON METRO POLICE: The majority of the work the unit has undertaken over the last two or three years has been African-based and significant of that amount, that work is linked to the investigation into James Ibori.
BOULDEN (voice-over): Detective Benton's team is not paid through the police budget. It's funded by the U.K. government's Department for International Development, the very office that's funneling money to Africa is now trying to make sure it doesn't come back to London in the bank accounts of foreign politicians.
BENTON: We hope that by tackling the likes of James Ibori, by saying to those corruptly stealing from their state purse, you can't have your children in private school in London. You can't have a several million- pound house in one of the most affluent areas in London. You can't drive around in top-of-the-range vehicles. You -- we won't let you move money around to buy 90-million pound private jets.
BOULDEN (voice-over): London has particular appeal to sub-Saharan Africans. Historic colonial links mean many have family here. And its massive financial center means the wealthy, African and otherwise, move money through many British banks.
CHANDU KRISHNAN, TRANSPARENCY INTERNATIONAL: We should not be doing anything in the U.K. which would make us complicit in making the problem of corruption worse in African countries.
BOULDEN: Transparency International claims British banks must do more to check the source of money deposited in London. In March, Coutts Bank, the private banking arm of the Royal Bank of Scotland, was fined $14 million for not fully implementing so-called A-B-C rules, rules to mitigate bribery and corruption risk.
In a statement, Coutts said it found no evidence of money laundering, and that its processes are now robust. Many campaigners say London's banks are still part of the problem when it comes to African corruption.
KRISHNAN: I think we need to see more sanctions. And the greater the severity of penalties, the greater the deterrent effect. That will ensure that fewer institutions would commit these offensives.
Dotun Oloko was a whistleblower in the Ibori case. He says it's ironic that the U.K. government pays for anti-corruption police, but does not put more pressure on the banks.
DOTUN OLOKO, ANTI-CORRUPTION CAMPAIGNER: It's moving to the international financial intermediaries who believe that they can engage in these kind of activities with impunity, being protected by the same states or the same governments that are leading the global anti-corruption battle. So it's a terrible paradox.
BOULDEN: Now Dotun is worried about his safety. When his information on James Ibori was accidentally sent back to Nigeria, he had to relocate to the U.K. The British government has apologized for linking his name, but he says it won't stop his campaigning against Nigerian corruption, here in Britain and back in Nigeria.
BOULDEN: You do go back to Nigeria?
OLOKO: Yes, I do, because I have family there and I refuse to be cowed by the circumstances. But I'm fully aware of the risks involved.
BOULDEN (voice-over): Back at the Met Police, Detective Benton says British banks do cooperate in his investigations. But the money is tough to trace, even from high-profile politicians.
BENTON: They may have accrued legitimate wealth. They may have had family interests in businesses and so on. So therefore what you're trying to do is you're trying to look at a pot of money and go, what's legitimate and what isn't? And that can be very, very, very difficult.
BOULDEN (voice-over): And nearly impossible to trace without cooperation of African countries. Benton praises Nigeria for having over the Ibori evidence in a format that could be presented in an English court. Moving forward, he's telling countries the Met can offer advice to stop the next James Ibori before the money comes to London.
BENTON: So this is what we see with corruption. This is how we see people conducting money laundering. This is the way you can stop it in country, build up the walls to prevent it from happening in the first place.
BOULDEN (voice-over): London, long seen as an easy place for the money to flow, now trying to keep London from being the funnel for African corruption -- Jim Boulden for MARKETPLACE AFRICA.
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CURNOW: So just how involved are British banks in the tangled web of African corruption? That's coming up next.
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CURNOW: With the sentencing of Nigeria's James Ibori, there have been calls for British banks to be held more accountable for their alleged complicity in African corruption. Well, for this week's "Face Time" interview, we turn again to my colleague, Jim Boulden. He sat down with Robert Palmer from Global Witness, which wants an investigation into the British banks implicated in the Ibori case.
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BOULDEN: Let's start with the James Ibori case. I mean, you've written a lot about that and you've studied it. From the police (ph), they said this is quite unprecedented, this conviction and the cooperation not only of the banks but the cooperation of Nigeria. How do you see it?
ROBERT PALMER, GLOBAL WITNESS: I think it's very interesting that you have this corporation between various different agencies, that you have our development department here in London funding a police unit, because the government feels that there is a development issue if you have millions and millions of pounds flowing out to Nigeria into British banks.
So this is a really positive move. However, the thing that concerns me is that although James Ibori, his wife, his sister, his mistress and his lawyer have all been convicted of money laundering. There hasn't been enough attention, in my view, on the banks that helped facilitate that money laundering.
According to the prosecutor, Ibori and his associates have accounts with Barclays, the HSBC, Citibank. He had a Centurion American Express card, and these are major financial institutions that all took money from James Ibori and his associates.
BOULDEN: That doesn't mean, though, that these banks are money laundering.
PALMER: But banks have an obligation to check (inaudible) who their customers are and carry out ongoing checks on those customers to ensure that they're not involved in money laundering. If you are a CEO foreign politician (ph) and therefore a higher corruption risk in the way that James Ibori was. The banks have to carry out extra checks.
BOULDEN: Do you think the banks are now putting more of these (inaudible) checks and balances into their everyday practices?
PALMER: I think the only way we're going to get serious change is if you have heavy penalty, you go off individual bankers. And in the worst cases, in the most egregious failures, you put people in jail.
BOULDEN: Why are people from these countries using the London banks, and why is it that London banks have become part of this investigation and part of these criminal investigations?
PALMER: I think there are a couple of reasons that London is so attractive to corrupt politicians, such as James Ibori. First of all, we are a major financial and legal (ph) center, so there's a lot of expertise. And there's also a lot of assets that go through the British financial system. So it's easier to disguise your assets.
I think the second reason is that people like James Ibori, they want to come and spend their illicit loot in London, because the prestige about being able to bring your assets and your money and your wealth into the U.K.
BOULDEN: Does the Ibori case set a benchmark, set a bar? Because it's obviously been a very public case, now that he is sent to jail.
PALMER: Well, I hope that it will send a very strong signal that London is not a friendly or welcome place (inaudible) money. However, Ibori is just one corrupt politician out of thousands, and the Nigerian anti-corruption body, the EFCC, has indicted and investigated a whole slew of Nigerian governments.
James Ibori is the only one so far that has been convicted in the U.K. And there have been previous cases where assets belonging to other corrupt former governors were able to be taken and seized by the Nigerian authorities, which were in London.
But this is still only the start of what needs to be a much more serious attempt by the government, by the Metropolitan Police, by the FSA to really get serious when it comes to corrupt assets in the U.K.
BOULDEN: Won't it be the case, though, that if there is a corrupt political person from another country, if they can't use the London banks they'll use banks in another country? I mean, it's not going to solve the problem in that country in Africa, is it?
PALMER: What we want to do, what Global Witness is trying to close down the space in which these sorts of figures can operate. For the reasons I've talked about, London is a very attractive venue for corrupt politicians to (inaudible) places like West Africa and Nigeria.
There's a lot of prestige in being able to bring your assets to London. I think it does make a difference if you say actually no, London is not somewhere where you can bring your corrupt loot, where you can bring your money.
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CURNOW: You want to see any of our interviews, they're online at CNN.com/MarketplaceAfrica. But for me, Robyn Curnow and the MARKETPLACE AFRICA team, see you again next week.
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ERROL BARNETT, CNN HOST: On a journey of discovery, INSIDE AFRICA, I'm Errol Barnett, being put to work with the oyster farmers in southern Namibia.
I experienced what it takes to work with wildlife in the cool waters of the South Atlantic Ocean.
You got Mediterranean mussels?
(Inaudible).
INSIDE AFRICA, Saturday on CNN, in association with Zenith Bank.
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