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Quest Means Business
Iranian President Addressing Media; Bill Gross Out at PIMCO; US Markets Make Gaines Friday; Volatile Week on Wall Street; Dollar Stronger; US Versus Everywhere Else; European Markets Mostly Up; Last Chance for Europe; Waiting for Recovery in Europe
Aired September 26, 2014 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(NEW YORK STOCK EXCHANGE CLOSING BELL)
RICHARD QUEST, HOST: The umpteenth day of triple-digit moves on the Dow. It is up nearly one percent at the close. The bell is ringing. The
man -- ooh.
(GAVEL HITS)
QUEST: Well, he's hit the gavel. All of which tells us is that trading has come to a close on this Friday in September.
Tonight, the fall of the bond king. Bill Gross leaves PIMCO for different waters and sends shockwaves through the financial world
Also tonight, a stark warning to Europe from the Commissioner for Economics --
(BEGIN VIDEO CLIP)
PIERRE MOSCOVICI, EU COMMISSIONER DESIGNATE: This Commission is something like a last chance for Europe.
(END VIDEO CLIP)
QUEST: Pierre Moscovici says the European project must deliver or it will die.
And the man in charge of Ukraine's gas tells me he can't guarantee supplies.
I'm Richard Quest. It's Friday, and we still mean business.
Before we go any further, we go immediately to President Hassan Rouhani, who's giving a news conference in New York.
HASSAN ROUHANI, PRESIDENT OF IRAN (through translator): -- and a voice that this year was said in unison in the United Nations General
Assembly this year was the danger and the threat of extremism, of violence, and terrorism throughout the world.
The same point that I had in depth spoken of during last year's United Nations General Assembly. And the General Assembly, through the passing of
a resolution, accepted a world absent of violence and extremism initiative, the WAVES Initiative.
Today, we're all duty-bound in the face of this regional and international threat to have proper planning, being fully aware of where
the threat of terrorism emanates from, and how to combat it. A fight -- a staged fight for theater-like consumption cannot bring us to the objectives
of peace and stability in the region.
Terrorism has various sources. If we wish to fight against terrorism, we must cut off those sources. We must make it very clear that which has
been brought to bear and express, vis-a-vis ideology in this expression of violence is a lie, is a facade, and this violence and savagery has
absolutely nothing to do with any of the Abrahamic religions, including Islam.
And vis-a-vis this issue, there is a great burden of responsibility of fighting against terrorism on the shoulders of the cultural experts, the
writers, the analysts, and the public figures.
We must cut off the human resources of the terrorists, the countries that have served as conduits for the personnel and new recruits of the
terrorists must adhere to their responsibilities and not allow the terrorist groups to recruit and import the various savages from various
parts of the world through those lands.
The financial resources must also be dried up. The countries that thus far have aided and assisted financially the terrorist groups or the
private organizations and sectors in those countries have rendered aid to those terrorists, with the consent of those countries, of the government of
those countries, must feel the burden of this responsibility and cease every single financial assistance to every single terrorist group at once.
Those who have equipped and trained the terrorists thus far, perhaps some would say that the terrorists are some of the -- have conquered and
are making use of some of the military resources of the country, of the parts of the country that they have conquered.
But unfortunately, the truth is that those weapons are not found in those countries' military stockpiles of weapons systems. It is clear where
those weapons have from, and it is clear that those who have equipped terrorists must cease to do so at once.
Therefore, we all must also turn our attention to the financial, ideological, and cultural, and social tools used by the terrorists. The
aerial bombardments of a few geographical areas, terrorism will not be eradicated.
QUEST: President Rouhani speaking there and pulling together the strands in many ways of what's been a very busy week. The president
particularly saying a lie and a facade, that terrorists have nothing to do with the Abrahamic religions, and certainly nothing to do with the Islamic
religion. He says there's a burden and a responsibility on writers, on cultural leaders.
And most importantly -- and this is a theme that we've heard again and again over the course of this United Nations General Assembly week -- the
measures necessary to prevent foreign fighters from going overseas to take up arms with terrorist organizations like ISIS, and then, in its most
extreme fashion, returning back to their home countries.
So, the president, in many ways, being on the same page as all the other countries. But of course, the devil's in the detail, when you get to
it. And that, of course, we'll be hearing in the various questions and answers as it moves on. We'll keep an eye out for you as we do so, so that
we can continue our coverage, our conversation on business this evening.
And tonight, it's a case of the bond kind who moves to a new kingdom. In a surprise move, PIMCO's Bill Gross has left the company he founded more
than four decades ago. Gross built PIMCO from the ground up into the world's biggest bond firm. His departure caps a year of turmoil at the
company, in which it was riven by destructive tensions at the top.
Chief exec Douglas Hodge wrote, "Over the course of this year, it became increasingly clear that the firm's leadership and Bill have
fundamental differences about how to take PIMCO forward. Gross is to head to rival firm Janus Capital Group, where he'll manage a bond firm.
Janus Fund is the Roman god of transitions and new beginnings and is famous for having two faces, and Gross, too, is a tale of two
personalities. There's one of Gross of influence. He's known as the Bond King of Wall Street, the reputation built on years of strong returns.
Treasury dips and prices would follow -- would rise and fall.
Then of course, you've got the PIMCO of troubles. The company's facing an SEC investigation. Investors have pulled money from the flagship
fund for 18 months, and he's been accused of being abrasive in office.
There are reports that PIMCO was preparing to fire Gross. His top deputy, Mohamed El-Erian, left earlier this year. It's a case of intrigue,
mystery. CNN Money's Paul La Monica is with me. Why's he gone?
PAUL LA MONICA, CNN MONEY DIGITAL CORRESPONDENT: It sounds like there just was not any agreement between other people at PIMCO and PIMCO parent
Allianz about where this firm was going to be heading.
And when you look at the outflows, because the funds have performed pretty poorly compared to some of its rivals, it seems like Gross was just
looking for some greener pastures, and Janus, there we have it. And he gets to stay in California. He's not even moving to Denver.
QUEST: But they're opening a new office, aren't they?
(CROSSTALK)
LA MONICA: Yes, for him.
QUEST: They're actually opening a new office for --
LA MONICA: Exactly.
QUEST: -- you know you've made it when they open the office for you.
LA MONICA: It is definitely true, when you don't have to actually uproot at all --
QUEST: Right.
LA MONICA: -- you know, yes.
QUEST: So, he made his made his name with some very clever, excellent bets on Treasuries in the 90s, in the 00s. But in recent years, he's been
less successful, calling the bond market and the direction of the bond market. Because he famously said he was going to stuff himself full to the
gills. And then he famously said he was going to sell the lot.
LA MONICA: That is correct and it is, you see, with what happened with the bond funds returns, most prominently the PIMCO total return, it is
not the superstar in the industry. A lot of people talk about DoubleLine, another rival firm, and how that's stolen a lot of PIMCO's thunder.
So, I think what we have here, have a sports analogy, Gross going to Janus, Janus might be getting the David Beckham who went to the LA Galaxy.
He was still OK then, but he's not the Manchester United-type David Beckham anymore. So, even though Gross is still a legend, the luster, definitely,
he's lost a lot of it, I think, in the past few years.
QUEST: For PIMCO, it lost Mohamed El-Erian, of course who's regularly on this program. Now it loses Gross. How badly is PIMCO wounded by these
two giants gone? Or is it a case of rebuild and start?
LA MONICA: They're rebuilding and starting, PIMCO is doing its best to tout the deep bench that it has. And clearly any management firm is
more than just one or two people. But El-Erian leaving was a big loss for them as well, although he's still at the parent company, Allianz.
QUEST: Good to see you.
LA MONICA: Thank you.
QUEST: I guess he's kept quite a lot of money.
LA MONICA: Yes.
QUEST: He's not going to be short of the price of a cup of tea.
LA MONICA: No, not at all.
QUEST: Have a good weekend.
LA MONICA: Thank you.
QUEST: To the US markets, join me at the super screen where you will see very rapidly, the Dow has rebounded after yesterday's pummeling. The
Dow has closed -- at one point as the closing bell was ringing, that was one percent, but it just tailed off just a little bit.
But as you can see, get right in there and you'll see at the top, we're back over 17,000 -- actually, we're back over 17,000 again. We're
almost at the best of the sessions. The corporate results bested the estimates. Nike shot up 12 percent, S&P was up nearly one percent on
corporate results.
The US markets have been extremely volatile throughout the course of the week, despite some encouraging signs for the economy. Take a look and
you'll see how the Dow -- this is just one week's Dow. We've seen three triple-digit losses this week. Now we've got a triple-digit gain, four
triple-digits. But the week overall, a real Alpine roller coaster, if you like.
The dollar is growing stronger and stronger. Two-year high against the euro. This is a fascinating chart, again. The euro -- the US dollar
versus euro now it's just under 0.79. Signs of resurgence in the American economy as far as traders are betting on faster growth in the US than
Europe.
And the end of the Fed stimulus will also boost the dollar because in an interest rate differential, it looks like US interest rates will be --
well, not looks like. They will be going up long before European rates.
So, whether you take confidence or you take fundamentals or you take technicalities, the dollar seems to be on a one-way bet higher.
GDP in the US economy revised higher, 4.6 percent on an annual basis in Q2. It's the fastest pace of growth in some two years. Robert Shapiro
is the former US undersecretary of commerce, joins me now from Washington.
Robert, when you look at that, dollar up against the euro, stock market up a hundred and something points, where is the fly in the ointment?
ROBERT SHAPIRO, CO-FOUNDER AND CHAIRMAN, SONECON, LLC: Well, the fly in the ointment is Europe, Japan, and China. And Russia. That is the
United States is really alone among major economies in exercising this kind of strength. The UK is certainly doing much better than it was, but it's -
-
QUEST: Right.
SHAPIRO: -- an economy that's much, much smaller. The fact is, we've got stagnation at best in Europe. We've got stagnation at best in Japan.
And we have China looking like she's probably growing at around a 7 percent rate, which would sound great anywhere else, but is a substantial slowdown
for China.
QUEST: Right.
SHAPIRO: So, the fly in the ointment --
(CROSSTALK)
QUEST: Well, let me just --
SHAPIRO: -- is exports.
QUEST: Right. Let me jump in on that, because what you're -- the scenario you're suggesting is not quite decoupling, but it's pretty close
in the sense that the US now marches on a route at a speed different from others. So, the question -- it begs the issue, do they hold the US back?
Can they US decouple in that way?
SHAPIRO: Well, I don't think -- no, the United States cannot be decoupled. And at the same time, Europe in particular and China are not
decoupled from the United States. I think we're just in -- out of phase, so to speak. And I think there is really pretty good reason to expect that
the strength in the US economy may be growing.
QUEST: Right.
SHAPIRO: And if that's correct, that will certainly help Europe. But the fact is, Europe has so many problems right now. It's very hard to see
the justification for a strong surge of business investment in Europe. And without that, Europe cannot really recover.
QUEST: Sir, thank you for joining us, I appreciate it. Have a good weekend, thank you very much --
SHAPIRO: You, too.
QUEST: -- indeed.
SHAPIRO: You, too.
QUEST: Now, we'll be talking more about that stagnation that Robert Shapiro was talking about, and we'll be putting it into a theatrical
context a little later in the program.
European stocks finished the day higher, and the data showed strong US growth was, of course, pushed forward. The German economic confidence
slipped. Allianz plunged 6 percent. That was because of Bill Gross's departure. The ruble continues to be at an all-time low.
Robert Shapiro was talking about all those problems facing Europe. When we come back, the new EU economics commissioner tells me why the next
Commission could be a last chance for Europe. QUEST MEANS BUSINESS.
(RINGS BELL)
(COMMERCIAL BREAK)
QUEST: Welcome back. Do you want to talk about stark words on economic growth? "A last chance for Europe." That's how Pierre Moscovici
is describing the incoming European Commission. The former French finance minister will be amongst the group who's now got to boost growth, create
jobs and, crucially, lift European morale.
Moscovici takes over as EU commissioner for economic and financial affairs in November. In one of his first television interviews since
getting the new job -- and bearing in mind his former role as France's finance minister at a time of high deficits in France, breaking the
stability pact, I asked him his priorities.
(BEGIN VIDEOTAPE)
MOSCOVICI: My priorities will be the priorities of the European Commission, as they have been set up by President Juncker. We had
parliamentary elections for Europe. We showed that people were not rejecting Europe, but was disappointed.
And what the next Commission's mandate is about is jobs and growth through investment, and we must absolutely build a new capacity to develop
investment, to fulfill the investment gap in Europe in order to create jobs and to enhance our capacity to grow.
Because the eurozone and Europe as a whole is a zone of low growth. And this is not acceptable anymore. It's not good for the world. It's not
good for Europe. It's not good for our citizens. And the Commission will be the driving engine of new economic policy, still serious, but also very
active.
QUEST: The biggest issue that this Commission faces -- and you said it rightly yourself -- it's not about deficits. It's not even really about
austerity versus growth, although that's crucial. It's one of trust and confidence and belief in the European project and the European ideal.
Because with the barometer so low, surely President Juncker's cabinet, your number one task is to make people believe in Europe again.
MOSCOVICI: Absolutely. As I said, I'm a European. And I was struck by the message of the voters in May's parliamentary elections for Europe.
Because they said, we're disappointed. They said, Europe is not delivering. They said, if you don't act now, we are going to reject the
European project.
And this Commission is something like a last chance for Europe. Because if we don't succeed in a new tendency, which is to create jobs,
which is to enhance growth, which is to invest, which is to bring a new dynamism in Europe, then it will be the end of the European project.
And I feel that the mission of that Commission is somehow historical, and we need to show as well, as well, leadership for the president and also
good team spirit, and very decisive action.
And I myself, I'm persuaded of that. And I will bring all my strength, all my capacity to convince and to work to this job.
QUEST: You will now be evaluating the efforts of the government of which you formerly were a member.
MOSCOVICI: That's my job. It could have been somebody else. That's me. It's me, probably, because I've got the experience of what it means to
be a European, and what it means, also, to be a finance minister.
I would say I'm a member of the club. I've been for two years in the euro group in the Ecofin Council, at the G20 meetings, at the G7 meetings,
at the IMF meetings. And my will is to act as a European.
QUEST: Is there an inherent contradiction, difficulty, or even challenge reconciling the necessity of job creation and growth with the
continual reform, and in some cases, austerity, that's required to put Europe on sound financial footings?
MOSCOVICI: I don't see any contradiction. But the challenge? That's sure. The world and Europe, we've been through an economic and financial
crisis since 2008. And we made huge efforts in order to stabilize the eurozone, in order to secure our financial system.
And now, we must move to another period. And this period is a period when we are still in fiscal consolidation, although many efforts have been
done. But we are more active, more dynamic, on growth and jobs.
(END VIDEOTAPE)
QUEST: Pierre Moscovici, who will face some sharp questioning by members of the European Parliament in his confirmation when he meets them
in the next couple of weeks.
After the break, we're going to continue talking about that whole question of stagnation and the question for Europe and economic growth, and
we'll put it in a theatrical context, "Waiting for Godot."
(RINGS BELL)
(COMMERCIAL BREAK)
QUEST: "The tears of the world are a constant quantity, for each one who begins to weep, somewhere else another stops." Now, those are the
words from Samuel Beckett's iconic play, "Waiting for Godot."
You might say that signs of strong growth in the United States economy are abounding. Meanwhile, markets in Europe, well, they are the ones that
continue to weep. The latest evidence: German consumer confidence is expected to fall in the coming month.
And elsewhere on the continent, GDP is so flat it's almost nonexistent. Unemployment is little changed. Productivity is relentlessly
weak. Even those countries, like the UK, which are growing are being held back by these slower-growing countries in parts of Europe.
Europe is waiting for recovery, and much like Beckett's title character, "Waiting for Godot," Europe has failed to arrive.
(BEGIN VIDEOTAPE)
PATRICK STEWART AS VLADIMIR, "WAITING FOR GODOT": How does it hit me?
IAN MCKELLEN AS ESTRAGON, "WAITING FOR GODOT": How would I know?
(LAUGHTER)
QUEST: Knights of the realm Ian McKellen and Patrick Stewart in Samuel Beckett's "Waiting for Godot." The play about waiting for someone
who never arrives. The story of promises unfulfilled.
Often, it seems like the eurozone is waiting for Godot, and sometimes, the policymakers sound like the players on the stage.
ANGEL GURRIA, SECRETARY-GENERAL, OECD: There's only so much the central banks can do.
JACK LEW, US TREASURY SECRETARY: If the efforts to boost demand are deferred for too long, there's a risk that the headwinds get stronger.
QUEST: Beckett's play seems almost made for the eurozone. Deferring actions until, finally, nobody knows what's really happening.
MARK NIXON, DIRECTOR, BECKETT INTERNATIONAL FOUNDATION, UNIVERSITY OF READING: So, there's a sense of stagnation during the waiting.
QUEST: Ah, stagnation. Where have I heard that before? In the eurozone. Zero growth in the second quarter.
NIXON: Doubt and uncertainty is rife throughout the play.
QUEST: "Doubt and uncertainty." Waiting for Draghi. Just look at the euro, waiting for help.
UNIDENTIFIED MALE: It might have been that the ECB could have done more earlier.
QUEST: Just like Beckett's play, the ECB has introduced props. Carrots to help banks lend, with targeted long-term financing. The only
problem is, few are nibbling.
MOHAMED EL-ERIAN, CHIEF ECONOMIC ADVISOR, ALLIANZ: It will take further steps. It will do more come October. But it will not be
sufficient.
NIXON: There is, obviously, very little dramatic action. So the play, essentially, is made up of language, of language games, of dialogue.
QUEST: Like Beckett's play, there's no shortage of dialogue in the eurozone. As a new Commission takes office, will that change as fresh
actors take to the stage?
MOSCOVICI: What the next Commission's mandate is about is jobs and growth through investment.
QUEST: With 11.5 percent of their audience unemployed, there are lessons to be learned from Samuel Beckett's play. You may wait for Godot,
but you dare not wait for growth.
STEWART AS VLADIMIR: Will that pass the time?
(LAUGHTER)
MCKELLEN AS ESTRAGON: It would have passed in any case.
(LAUGHTER)
(END VIDEOTAPE)
QUEST: When we come back, the race to solve the energy dispute between Russia and Ukraine. It's getting closer because winter is almost
here, and the weather is turning clover.
(COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. This is CNN, and on this network, the news always comes
first.
Iran's president has said his country will never give up its right to peaceful nuclear activity. Speaking during the course of the past hour,
Hassan Rouhani said the Iranian people are keen to earn the trust a nuclear agreement would bring. Iran's been meeting with six world powers in the
latest round of nuclear talks on Friday. So far, there's been little progress.
Kurdish fighters have engaged with ISIS militants trying to advance on the Syrian-Turkish border. A CNN team captured this dramatic video of
firefight early on Friday. A crowd of Kurdish refugees watched and cheered as troops fired against the militants.
British lawmakers have voted overwhelmingly to join the US-led coalition launching airstrikes against ISIS in Iraq. It was a vote of 524
to 43. It followed seven long hours of debate. The motion only covers strikes against ISIS in Iraq. It does not include Syria.
The death toll from Ebola officially now has -- in West Africa has passed 3,000 says the World Health Organization. The International
Monetary Fund joined the World Bank announcing more funding to fight the disease. The Fund's managing director, Christine Lagarde, warned of deep
economic consequences if the virus was not contained.
Russia and Ukraine are taking steps towards a deal which would get the gas and the money flowing once again. Both sides along with the E.U. have
been talking in Berlin. The proposal is Russia will pay $3.1 billion -- so Ukraine will pay $3.1 billion to Russia and the gas gets turned on.
There'll be a final decision next week. The pressure on Ukraine was amplified on Thursday when Hungary turned the supplies off. Come and have
a look and I'll show you exactly how the situation reads. Look at the Super Screen. Now, this is the situation - obviously you're familiar with
the map where Ukraine is, where Hungary and other parts of Eastern Central Europe. Now, these are the gas pipelines running through the continent.
They run from Russia, they run through Ukraine heading up towards the north towards Poland and beyond and then down into Hungary and other countries.
In June, Russia cut off Ukraine directly from gas because of the unpaid bills. But Russia's gas flows through, and under a process known as
reverse throws -- reverse flows in -- Hungary, Poland and Slovakia - they send some of it back to Ukraine. They've been pumping the gas in this
reverse flow method. Now, Hungary has said that it's going to pull the plug. Hungary's prime minister has been a supporter of President Putin.
Prime Minister Orb n recently met with the head of Gazprom. I spoke to the chief exec of Ukraine's Naftogaz who was taking part in the talks, and I
asked him if his continent, his country has enough gas to keep the fires burning this winter.
(BEGIN VIDEOCLIP)
ANDRIY KOBOLYEV, CEO, NAFTOGAZ: So far I cannot confirm to my people is that Gazprom has agreed to commercial-level negotiations. We have not
seen that agreement so far from them. That is why the frank answer is no.
QUEST: If the answer is no, and now we're hearing Hungary, which seems to be siding with the Gazprom Russian argument on reverse flows, your
situation is difficult, but would you say it's critical at this point?
KOBOLYEV: It is difficult but is not critical. Not all of our options have been used. There is potential to increase flows from
Slovakia. The potential is huge. Current flow from Slovakia is seven times higher than the flows that we had from Hungary. So it is a much more
important destination and the potentials there is still unexplored.
QUEST: Do you believe the Hungarian position when the say they did this because of greater domestic demand requirements in Hungary? Or do you
think politics was at play in the decision for Hungary to side with Russia?
KOBOLYEV: For me it's difficult to assess what was real reason. However, the most important thing for Ukraine is that we are often asked to
comply with our conscience. And the situation with Hungary is absolutely vice-versa. We have contract with two large European well-known companies
who are (prepared/prepaid) (ph) and who are obliged to supply gas to us. Now they're failing their contractual obligations because of this
interruption. This issue needs to be investigated further and we believe that European solidarity is a principle we should so often recollect it
when we discuss gas issues should be also applied in this particular case.
QUEST: Finally, sir, the - I come back to this question because the weather turns and things are difficult - what will you now do? What's your
number one priority?
KOBOLYEV: Our number one priority is with using gas consumption in Ukraine and creating emergency plan which we have already created actually
- I mean implement an emergency plan in case the gas supplies are cut, to make sure that our people stay warm and there is enough temperature in bed
rest (ph) and there is enough electricity and there is enough gas for our industrial consumers. Because so far we have not seen agreement as I
already said to critical elements of the E.U. proposal. We should be accepted by Gazprom's side in order to make sure this winter goes smoothly.
(END VIDEOCLIP)
QUEST: Head of Naftogaz in in Ukraine with the priorities for, quite bluntly and honestly, keeping the lights on and keeping the fires burning.
The weather forecast now. Jenny Harrison is at the World Weather Center where temperatures are - I think we're at that part of the year in Europe
where it's getting a little parky.
JENNY HARRISON, WEATHER ANCHOR FOR CNN INTERNATIONAL: Little bit parky, Richard, but it does depend where you are -
QUEST: Ooh, ooh -
HARRISON: I know, I know you - seriously. Yes, depends where you are, it really does. So the southwest of Europe and actually Western
regions still very much a bit of a warm up phase if you believe yet - not even cooling down but actually warming up. Now, also some very heavy rain
across the southeast of Europe. Let's have a look at Scotland because the Ryder Cup of course continuing Saturday and Sunday. There's been quite a
few sort of showers across the region in the last 12 hours. Didn't really see any rain though on Friday for play, and it didn't obviously affect that
at all. It was quite windy at times - gusting to about 50 kilometers an hour. And in fact on Saturday, it could get a big windy as well, but it
should stay dry for the next few days. A bit more sunshine around on Saturday and Sunday, but actually a bit warmer on Sunday with a high of 18
degrees. So if you break it down hour by hour on Saturdays - a very nice sunny start, and then a cloud begins to develop as you can see.
But the wind's actually coming in from the southwest though - mostly westerly on Friday. Southwesterly winds and as I say again maybe gusting
to about 40 kilometers an hour at times. And also on Saturday, in London Wembley Stadium. It's actually kickoff - I'm not sure if you call it
kickoffs, do you, for American football. But kickoff anyway 6 p.m. local time in London. You've got the American football - -two teams - the Miami
Dolphins and the Oakland - something, Richard. You will know I'm sure. I've actually just forgotten what they're called.
QUEST: No clue.
HARRISON: But anyway, the Oakland - say it again, someone just told me. Didn't hear what they said. But anyway, they are playing on Saturday
in Wembley. It should be dry for that - nice and warm as well. There's the warmth and there's the rain across the southeast. And we have had a
couple of fairly notable accumulations in the last 24 hours - 50 millimeters into Southern Italy and again there's a bit more to come.
There's a fairly stubborn area of low pressure, so we've got some warnings in place here, pushing on into Western Turkey as well. And still across
northern areas of Africa, we've got heavy rainfall, severe winds, maybe even some large damaging hail. This is what I mean about temperatures,
have a look this this - 5, 6 even 7 degrees above the average for Paris, Amsterdam and London as we go into the weekend. Look at this - Sunday in
Paris 26 against an average of 19 degrees Celsius. Still very nice as well for Oktoberfest. As we go through the weekend, not quite as warm as it is
further to the west. But even so, temperatures here a few degrees above average - 16 is what it should be. But by Monday, 24 degrees Celsius. A
little bit colder of course in the overnight hours. There's that rain in the southeast - pretty dry really for the most of Europe and then we've got
that system in the southwest too, hence the warnings that were also in place for Portugal and Spain.
Temperature-wise on Saturday - 19 in Vienna, a little bit cooler there. Just 17 up in Copenhagen. As for elsewhere around the world, have
a look at this - New York - I need to move so you can see - very nice 28 degrees Celsius which is 82 Fahrenheit. We've got some scattered
thunderstorms in Sao Paulo, Buenos Aires should be quite nice, temperatures in the low 20s. And then for Tel Aviv, Cairo and Riyadh, no surprise
there, Richard, of course temperatures in the low to mid, even high 30s under clear sunny skies.
QUEST: Thank you very much. It is the Oakland Raiders.
HARRISON: Thank you.
QUEST: And it is called a kickoff.
HARRISON: Oh, it is called a kickoff. Thank you very much, now I know that.
QUEST: I think you've been at the cooking sherry.
HARRISON: (LAUGHTER).
QUEST: Thank you very much, Mistress Harrison who'll now go and return for a light little tipple. Now, a century since the birth of Pierre
Balmain and the Fashion House which bears his name is still a hot ticket at the Paris Fashion Week. Of all the shows that Kim Kardashian and Kanye
West could have picked, it was Balmain's spring and summer collection where they chose to appear on the front row. They don't look very happy to be
there but they are at least there. And it's all thanks to a creative director who's still in his 20s. Myleene Klass got an exclusive look at
the collection.
(BEGIN VIDEOCLIP)
(MUSIC PLAYS)
MYLEENE KLASS, HOST OF "FASHION SEASON: PARIS": Backstage at Balmain, Olivier Rousteing could easily be mistaken for a model. The 28-year-old
has youth, looks and cool, but he is in fact the man at the top - Balmain's millennial artistic director transforming the brand for a new age.
OLIVIER ROUSTEING ARTISTIC DIRECTOR, BALMAIN: When I took over like the Balmain House, I wanted to bring back the DNA - you know - the archives
because Pierre Balmain was known for like leisurely Madame should wear it like an amazing terring (ph), but I wanted to twist it with my edge, you
know, my generation.
KLASS: Only 25 when he was thrust into the limelight, he initially worked under the former creative director Christophe Decarnin with crystal-
encrusted designs and super expensive ripped jeans created a frenzy of Christophe's Balmain-ia.
ROUSTEING: Christophe was another age, another generation - loving different kind of news and icons, like he was more into Kate Moss and rock
and roll and six-piece stoles (ph), you know. And what I loved about him, he was like all the sex appeal that he introduced to the House. But my
generation is more hip-hop, more pop.
KLASS: He is a contemporary designer with contemporary inspirations. He's a master of social media with more than half a million followers on
Instagram featuring selfies with the Kardashian sisters and Rihanna.
ROUSTEING: Rihanna felt my muse from the beginning, because I love women and I think I love Wonder Woman - you know - like those kind of women
that have no boundaries and no limit, and have this power to express them- self.
KLASS: We got an exclusive look at his new collection ahead of the catwalk show. In his Parisian atelier, the final beads are still being
sown on, the final feathers being smoothed down. This collection is his boldest yet.
ROUSTEING: You know, like even Rihanna now when she came to my after- party last winter, she was dressed with my skirt in leather and she got this (inaudible) full see-through top, and she was kind of naked
underneath, and that inspired an entire collection. You can see - like it's all about see-through and showing/not showing what is sexual today.
For my first collection it was all about traveling. All my inspiration now is just all about like waking up in the morning, watching MTV and not being
inspired maybe about clothes really, but more being inspired by energy, you know.
KLASS: Such constant and unrestrained energy is the privilege of youth.
ROUSTEING: When I got the job, I was like 24 or something like that. You know, you just say, 'Oh my God,' it's happening to me. So let's change
the entire world. If I had this job at 45 or 40 I don't think I would do the same clothes. I don't think that I will express myself in the same
way. But in think in fashion world, being young is not the best. Being cool is - it's you know - being old, you know. And being respecting means
that you need to sometime more than 40.
KLASS: As his army gets ready, a vision of a new generation is about to stride down the catwalk. A new generation with all its cockiness of
youth, all the freshness, all the dreams. And on its back, a pinned over hopes at the House of Balmain. Myleene Klass, CNN Paris.
(END VIDEOCLIP)
QUEST: And for those of us over 50, I feel old. And that's "Quest Means Business" for tonight. I'm Richard Quest in New York. Out on
assignment next week, so whatever you're up to in the week ahead, (RINGS BELL) I hope it's profitable.
(END QUEST SHOW)
(COMMERCIAL)
(BEGIN "MARKETPLACE AFRICA" SHOW)
ROBYN CURNOW, ANCHOR AND INTERNATIONAL CORRESPONDENT FOR CNN, BASED IN JOHANNESBURG, SOUTH AFRICA: You're Welcome to Marketplace Africa. I'm
Robyn Curnow. Now, agriculture is still the dominant industry in Uganda despite a push into other sectors. This is particularly true in the rural
areas where opportunities are limited, which is why one community's had to get creative and innovative.
(BEGIN VIDEOCLIP)
Kasese, Western Uganda. This is one of the country's biggest banana- growing areas -- miles and miles of banana trees growing on this fertile land. The trees not only produce bananas, there's another byproduct -
banana fiber. It's removed from the barks of the trees like this. One removed, it can be used to make a whole range of products including rope.
It's virtually cost-free and 100 percent natural.
This group came together and formed a co-op to take advantage of the abundance of this natural product in the area.
Female: What we're doing is a banana fiber rope. So what I do first is that I get some water so that becomes soaked. After it's been soaked,
then I start splitting it into small pieces. (Inaudible) we're doing it - so why I'm doing this is to get the sight (ph) of that rope I'm going to
make.
CURNOW: The association sells the rope in bulk to various clients who then use it to make furniture and crafts. Evelyn Zoango (ph) is a
furniture designer. She's been working with the association since the project began.
EVELYN ZOANGO(ph), FURNITURE DESIGNER: How we actually happened to get the fiber is because a lot of - a lot of the fiber that we did - the
baskets - how the baskets are made, is used by papyrus. But then the banana fiber itself, where before it was always used as to sort of cover
the banana plantations to give them facility. But then we realized actually this fiber - the color - would be - is very beautiful first of
all.
So we realized that we can actually - if you're really, really top and then make a rope, then from that rope then make another rope which really
gets to be fun, you can make baskets out of it. And it doesn't have to be a waste of some sort and we can actually use it. But why we actually chose
Kasese to be the destination of where we actually chose, there's a lot of plant - banana plantations - around this place and (covaros) than to any
other side of the country. The beauty of this fiber, instead of like sometimes with the headboards, we used to make them with papyrus. And
papyrus sort of became stuck (ph) in a way. So we incorporated the banana fiber to give it beauty to the headboard. Because even the color of the
wood we use itself, it is sort of looking the same way, like the banana fibers.
CURNOW: And since the project started two years ago, demand has increased, and the price per meter has almost doubled. This group is made
up of the Kasese landmine victims, many of whom lost limbs when landmines were planted in this part of Uganda. The device were deployed mainly by
rebels of the Allied Democratic Forces during a 20-year insurgency against President Museveni that ended in 2005. Many of the survivors have found it
hard to find employment, so instead they support themselves by making rope. They can make up to $4.
AHAB MOATHU, KASESE LANDMINE SURVIVORS ASSOCIATION: So far we have registered 136. But there are many more who are not yet registered with us
because of financial support.
CURNOW: Many were forced to leave their homes in the surrounding mountains, unable to work the lands. They come here to live in Kasese
where it is flatter and easier to move around. Now they've found a way to support themselves and come together as a community. Wilson Bwambale runs
the non-profit Anti Mines Network here.
WILSON BWAMBALE, CO-COORDINATOR, ANTI MINES NETWORK: It is important in two ways. One way is obviously an income generating activity where at
least a few - a few coins -- go into their pockets. The other is when they come together - we encourage weaving when they are together. It is some
kind of peer to peer support for each other. They get to understand what problems each one of them is facing. You know, the rope projects brings
them together.
MOATHU: If we can train all of our survivors, they get all involved, we think we can set for anusic (ph) much more and our customer also gets
the quantity that he likes.
CURNOW: The group's coordinator sees even more potential for the future - by taking advantage of a free natural resource. This group of
people has not only improved its lot financially, but also empowered itself, giving them hope and courage for a brighter future.
(END VIDEOCLIP)
CURNOW: From the track to the boardroom, how a career in athletics is paying off for one entrepreneur.
(COMMERCIAL BREAK)
CURNOW: Welcome back. He was a member of the Ghanaian sprint team at the 2000 Sydney Olympics. Since then, he's turned his attention/his
ambitions to technology - opening up businesses here in Africa and the U.S. For this week's "Face Time" interview, meet Kenny Andam.
(BEGIN VIDEOCLIP)
KENNY ANDAM, FORMER OLYMPIC SPRINTER: You look at track and field and athletics in general, you have to have certain qualities that makes you a
unique athlete. You have to first be dedicated to the sport, be committed to wanting to go to practice every day, always having a good memory on what
you learned from your coaches and being able to apply what you learn in the field of competition. And I picked those pieces up from the leadership of
a gentleman that brought me up - Coach Willard Hirschi from Brigham Young University. Through his principles that he always taught us, he said that
if you want to succeed in life, always have a good memory. It also gave me the ability to apply the same sentiments in business. Because in every
business venture, there's always a sale and a buy. If somebody's selling you something, you either go in to be able to accept and buy what they're
selling you, or you sell them on not wanting to buy what they're selling you.
So whatever transaction goes on, somebody's going to walk out buying and somebody's going to walk out selling. And I've always made it my
mantra to make sure that I identify the right opportunities, so when I'm buying, I'm buying at the right price, and when I'm selling, I'm selling at
a good return. When you focus on building a business with the talents and the dedication that you've learned in athletic field, you're definitely
going to come out with great returns that will help you contribute back to people that you love/care about. And, you know, the world in general.
And if you look at somebody like myself, I have a fiduciary responsibility not only to people who look up to me in the United States,
but also people who look up to me on the continent of Africa. Look at the size of Africa - you're talking about over 1.2 billion - approximately - on
the continent. Most of the continent is looked on by the world as an impoverished continent. But there's prosperity and then there's massive
natural resources. The only reason why these resources don't gain the attention that they need to gain, it is because of the transfer of
information and knowledge to the bottom line people who have the ability to exploit them.
And so then somebody like me comes to the United States, start realizing the freedoms that exist over here and then build a business,
gradually you develop an entrepreneurial spirit and give a vision to the African child that it is possible to make it on the continent by basically
seeking information, learning and having a good memory. If Kenny can do it, you can too.
My mother taught me when I was growing up that anything that happens to your life, enjoy it and laugh it off because in the future, you look
back at it and laugh it off. My father always said that don't ever allow your anger to drag you to a point where you forget yourself and forget who
you are. Because at the end of the day, that negative energy affects your progress and create a stumbling block for yourself more than the person
that caused you to become angry. Those two principles taught me the art of dedication and confidence in myself to know that if I'm selling myself to
somebody, I should be able to represent myself in such a way that I don't allow their reactions to anger me, and even if it did, I should just brush
it off and laugh it off because in the future I'll look back on it and laugh it off. That was a very good foundation from my parents. I took it
from them and I implemented them today.
What I see - several roadblocks that entrepreneurs deal with. One that I hear everybody talk about is the financial constraints. Most
entrepreneurs in Africa feel that without money, you can't build a business. Businesses don't start with somebody else giving capital to an
idea. Businesses start with somebody taking capital and giving it to an individual. That individual has the ability to get that capital based on
how good they are at selling something. So if you come to an investor who has money and you want your business to be funded, you need to go to them
with a mentality of having the ability to sell yourself to that investor. After you sell yourself, selling the idea is very easy. And so that is one
of the biggest challenges that I see.
Number two, as - you know - the youth and the type of educational direction that they receive. The educational direction is geared towards,
you know, formal civil service or, you know, structured, you know, industries like the medical sector and the healthcare sector. I feel that
those are great because they're solving very important - they play a very important role in our society. But on the same respect, you know,
governments in Africa and the people within the various communities who start encouraging the youth and the younger generation to become more
entrepreneurial. And from that stance, start introducing the art of entrepreneurship in our everyday educational system.
Africa itself is an open market. Each country has huge potential. The leadership have learned the lesson of democracy and stability at being
the key resources to - you know - attracting foreign investors and foreign capital and they've also learned that when you bring foreign capital, you
create employment for your people. And when the people are happy and they are fed right and they have the right necessities in life like medical,
good healthcare and good education for your kids, you create a stable environment that everybody will live a better lifestyle
So the future of Africa is bright from my perspective. The emerging markets are the best place to be to do business because the returns of
capital investments are incredible. And Africa is on the top tier of that right now.
(BEGIN VIDEOCLIP)
CURNOW: Entrepreneur Kenny Andam there. Well that's it for this week's show. I'm Robyn Curnow. Please do join us again next week. In the
meantime, we're online at cnn.com/marketplaceafrica.
END
