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Quest Means Business
Hong Kong Protesters Vow to Stay; Stocks Fall in Hong Kong; Hong Kong Protesters Defy Beijing; Brazil Bovespa Falls as Rousseff Widens Lead; Dow Down, Dollar Up; PIMCO Execs Manage Bill Gross Fallout; Indian PM Heads to White House; Nobel Winner Demands Poverty Action
Aired September 29, 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)
POPPY HARLOW, HOST: It is the closing bell on Wall Street. US markets have recovered some of their early losses. It is Monday, September
the 29th.
Tonight, no sign of backing down. Thousands of protesters are still occupying Hong Kong's financial district. We will be there live in just a
moment.
Also, a Brazilian backlash. As Dilma Rousseff goes up in the polls, the stock market heads downhill.
And Mr. Modi goes to Washington. India's prime minister meets with top CEOs before heading to the White House this evening.
I'm Poppy Harlow, and this is QUEST MEANS BUSINESS.
Good evening, welcome to the program. It is 4:00 in the morning in Hong Kong. Thousands of pro-democracy protesters camped outside on a major
highway in the center of the city. They show no sign of leaving. The scale of this protest is unprecedented. It is the biggest since the UK
handed Hong Kong over to China back in 1997.
And what began as a peaceful student demonstration escalated over the weekend. More than 50 people have been injured since Sunday. Protesters
used goggles and umbrellas to try to protect themselves against teargas.
The demonstrations were sparked and are sparked by China's decision to allow only candidates vetted by Beijing to run in Hong Kong's 2017
elections. Andrew Stevens has the latest from the site of the protests. Andrew?
ANDREW STEVENS, CNN INTERNATIONAL CORRESPONDENT: Poppy, thanks very much. As you say, it's just gone 4:00 in the morning here, and just take a
look at the number of people who are still here, camped out in the main thoroughfare. This the main road going into the central business district.
And the plan here is to try to close down as much of the business, the financial hub as they can to make their point that they want more democracy
in Hong Kong.
Now, take a look at the people, and it is being led by students and younger people. They are still dressed just in case there is another move
by the Hong Kong police which would involve teargas or pepper spray.
They're wrapping their exposed flesh in plastic, you can see there. They're wearing -- there's a lot of goggles, there's a lot of face masks,
there's a lot of plastic rain coats just in case the Hong Kong police repeat what they did, now, 24 hours ago, Poppy, which was to use teargas
and pepper spray on the students, as they were, they're mainly students protesting.
This was an extraordinary development in Hong Kong. This is not a city that is unused to protest, but protests here are very peaceful as a
rule. To see those gas attacks on the students --
HARLOW: Right.
STEVENS: -- really did actually backfire on the Hong Kong government. You're getting more and more people out here. I've been speaking to people
here who have come because of what they saw about those gas attacks.
HARLOW: And Andrew, I'm wondering if you're getting a sense that those protesters are entrenched, they are dug in for the long haul.
Because we heard one of the organizers just telling our Christiane Amanpour they are preparing for another stage, a different stage of this movement
starting October 1st. So, this is a long, protracted fight, it seems.
STEVENS: I think that is a fair read of the situation at the moment. There is no sense that these students and the protesters who are down here
today are here for the short term. They want to see democratic change.
Everyone you speak to says, "I am going to stay here, I'm going to go home and have a shower, and then I'll come straight back again and I'm
going to stay here until I see democratic change in Hong Kong."
It all revolves around the selection process for the people who the Hong Kongers will then vote for --
HARLOW: Right.
STEVENS: -- for the next leader of Hong Kong. That is the sticking point. The issue here, though, Poppy is that Hong Kong has said, the
government has said, this is an illegal gathering. Beijing has backed Hong Kong to the hilt on this, so you have demonstrators here who aren't going
anywhere, the Hong Kong government backed by Beijing saying this is al illegal operation.
So, predicting what happens next is very difficult. What we're talking about this second stage is that initially, several months ago,
tomorrow October 1 was going to be the first day of the rally. It's already started, but a lot more people are expected to join tomorrow --
HARLOW: Wow.
STEVENS: -- as it's a public holiday. So, we are going to see this protest continue to expand.
HARLOW: And Andrew, quickly before we let you go. The key question: to have their demand met, Beijing is going to have to fold. And so many
people wonder, is there even a remote possibility of that? But given what we're seeing and how historic it is in the streets of Hong Kong, day by
day, is that increasingly a chance?
STEVENS: It's a very, very difficult question to answer, this one, Poppy, and I wouldn't like to second-guess what Beijing is thinking. They
have never shown a willingness to back down to people's demands. They want this issue resolved as quickly as possible. What they don't want is to see
the sort of scenes that we saw 24 hours ago of people being teargassed on the streets of Hong Kong.
This has turned into such a big demonstration, now, it's going to be very difficult for the police, even if they wanted to, to try and move it.
And it could become quite violent. That is the last thing Beijing wants.
But they are very firm. They see this as a part of China. There's a much bigger story here called China. The last thing they want is images
coming out and the news coming out that Beijing is backing down to street protests in Hong Kong.
HARLOW: Yes.
STEVENS: That just doesn't wash in Beijing. So, hints. We've got this standoff. The demonstrators here are saying we're not going anywhere,
the organizers are saying we are going to continue this campaign of civil disobedience.
The Hong Kong government saying it is illegal. Beijing saying we 100 percent support Hong Kong. It's very, very difficult to predict a
compromise way out of this at the moment.
HARLOW: Yes, and even 4:00 in the morning and the streets are full with thousands and thousands of young people making their voices heard.
Andrew Stevens, thank you for the reporting throughout. Thank you, we appreciate it.
These protests began with the Occupy Central movement vowing to shut down the business district. Traffic in affected areas has come to a
standstill. Cars and buses have been abandoned just in the middle of the street.
Monday's protests were concentrated near the central government offices. Schools, businesses, bank branches in the central district have
closed. Some major firms in the area urged their employees to stay home, do not come down to this area.
The stock exchange, meanwhile, says trading does continue as normal. Stocks in Hong Kong, though, fell on Monday. The Hang Seng ended down 1.9
percent, as you can see here, rough on the markets, certainly, there, all of this has been. It is down more than 6 percent over the past month.
Hong Kong's monetary authority says it is ready to pump money into the banking sector if that is necessary. Meanwhile, ratings agency Fitch says
it does not expect the protest to hit Hong Kong's credit rating in the short term. However, it did warn that it could if the protests begin to
affect Hong Kong's financial stability or, of course, dramatically affect Hong Kong's economy.
The UK government has raised concerns about the police response to those protests in Hong Kong. While the territory did not enjoy true
democracy under British rule, it was handed over to China on the understanding that certain freedoms would be retained. Our Kristie Lu
Stout charts the movement that led to this mass expression of public discontent.
(BEGIN VIDEOTAPE)
KRISTIE LU STOUT, CNN INTERNATIONAL CORRESPONDENT (voice-over): The red flag of China turned upside-down, an act of defiance in Hong Kong.
(MUSIC - "GOD SAVE THE QUEEN")
STOUT: Since the 1997 handover from Britain to China, the territory has been ruled under the principle of one country, two systems, granting
Hong Kong a range of liberties not seen in the mainland, from the freedom of speech to the right to protest.
(MAN SHOUTING IN MEGAPHONE)
STOUT: Protesters have been exercising those rights, challenging Beijing's decision to control who can run for the city's top official post,
currently held by the beleaguered C.Y. Leung. Last week, thousands of Hong Kong students led peaceful boycotts and protests for free and open
elections. One of the protest leaders, Joshua Wong, was arrested and later released.
JOSHUA WONG, STUDENT ACTIVIST (through translator): I remember that when I was at the police station, I had more than 10 wounds. I just weigh
about 100 pounds, but 10 police were there to arrest me. I was shocked. I thought they would only keep me for less than 20 hours.
Neither the Occupy Central trio nor the Federation of Students can stop this protest. C.Y. Leung is the only person who can call a stop to
this.
STOUT: On Sunday, the largely peaceful protests took a turn. Police in riot gear moved in on the demonstrators, using teargas to disperse
crowds that brought parts of the city to a standstill. To protect themselves, protesters wore goggles and masks and held umbrellas, now a
symbol of the protest movement.
These scenes shocked the world and residents of Hong Kong, a usually peaceful and stable financial center. Dozens were injured.
(CROWDS SHOUTING)
STOUT: According to a report in Chinese state media, Beijing says it is confident the Hong Kong government can handle the movement lawfully. It
says it also opposes all illegal activities that, quote, "could undermine rule of law and jeopardize social tranquility."
Today, schools and banks in parts of central Hong Kong were closed, but pro-democracy protesters say they're not going anywhere.
UNIDENTIFIED FEMALE: As long as it takes. As long as there's one person that's still out here on this highway, I'm going to be here.
JIMMY LAI, FOUNDER, NEXT MEDIA (through translator): Fighting is the only thing we can do. We have no power. We either choose to be cowards,
or citizens in a free society. If you choose to be a coward, well, that's too bad. But if you don't want to be a coward, I think as a Hong Kong
citizen, I should come out, do the little I can, and step up.
STOUT (on camera): And more people have stepped up to join in. The protests here in Hong Kong have spread beyond the central business
district, across the harbor here, to Mongkok Kowloon. The protesters here have been asking for C.Y. Leung to step down. As the protests spread, it's
proven to be an even greater challenge for authorities already struggling to contain the anger.
STOUT (voice-over): China's flag was flying upside-down today above Hong Kong's main protest site, but it wasn't there for long. Now, as the
protests spread, the question is, how much longer will Beijing tolerate such an affront to its rule?
Kristie Lu Stout, CNN, Hong Kong.
(END VIDEOTAPE)
HARLOW: Kristie Lu, thank you very much for that report. Coming up next on the program, in Brazil, there is good news for the president. That
means there is bad news for the stock market. As reelection looks more likely, the markets take a plunge. We'll take you live to Sao Paulo, next.
(COMMERCIAL BREAK)
HARLOW: Brazilian markets have seen a sharp sell-off after the most recent polls show that President Dilma Rousseff gained ground in her bid
for reelection. The Bovespa plunged 4.5 percent on Monday alone. It is the single biggest decline of a day since July of last year. The real also
dropped to a 13-month low.
Voting begins this week. Ms. Rousseff and challenger, Marina Silva, have been neck-and-neck and could up in a too-close-to-call run-off
election. Let's discuss why the Brazilian economy is so closely tuned into this presidential race and Rousseff's chances for reelection. Shasta
Darlington joins us now from Sao Paulo.
So, the perception here -- and it's fascinating to see -- one poll showed that the current president has a bit better shot at staying in
power, and many, many people hit the sell button? Is that truly what drove it?
SHASTA DARLINGTON, CNN BRAZIL BUREAU CHIEF: Yes, Poppy. It's hard to believe, but basically, investors view Dilma Rousseff as more of the same,
and this is coming off of a recession in the first half of the year, so they view anything that a change from that, well, it's got to be a change
for the better.
And so, for the last few weeks, what we'd seen is Marina Silva, the main rival here, slightly ahead in polls. Indications were that she could
win in a run-off vote. This latest poll that came out actually Friday night after markets closed, so this was the first chance they had to really
react --
HARLOW: Right.
DARLINGTON: -- showed that these two women would go to a run-off vote, but that it was actually Dilma Rousseff who was pulling ahead. And
this is the woman who's been in charge for the last four years as growth has slowed, as we've slipped into a recession. Inflation has taken off.
So, when it looks like she's going to be in control for another four years, yes, we see a sell-off in stocks. The real, the currency, was
actually trading at more than a five-year low at one point --
HARLOW: Wow.
DARLINGTON: -- during the day. So, a lot of pessimism there, Poppy.
HARLOW: It's interesting, though, because people there, clearly, it seems, in terms of the sell-off that we just saw, would rather have a
relatively unknown when it comes to being friendly to the markets, if you will, and friendly to business, if you will. Because we don't really know
what -- how Silva would be in office, do we?
DARLINGTON: Yes, that's absolutely true. The -- she replaced Eduardo Campos when he died in a tragic plane crash just two months before the
elections. He was considered market-friendly. Marina Silva has been trying to convince voters and the markets and foreign investors that she
will do the same.
But she comes from a very different background. She comes from uneducated family in the north. She was born to rubber tappers, people who
were working in the forest of the Amazon. She only learned to read and write when she was a teenager --
HARLOW: Wow.
DARLINGTON: -- and she's a strong environmentalist. So, she's had to convince agri-business that she won't turn them over, turn them out. This
is big business in Brazil. And she's done a lot of that. She's obviously convinced enough investors that she's less of a threat than Dilma Rousseff
and the Worker's Party. Remember, they've been in power for 12 years.
HARLOW: Right.
DARLINGTON: So, a lot of people are ready for change, Poppy.
HARLOW: We will be watching very closely, but an incredibly sell-off today in the markets there. Appreciate it. Thank you very much, Shasta.
All right, to the US markets. It was all geopolitical worrying on Wall Street on Monday. The protests in Hong Kong are being blamed. The
Dow finished about 40 points lower. The US dollar climbed to its highest level against the yen in six years.
PIMCO in the headlines once again. It has the support of its parent company, Allianz. Executives are trying to persuade investors that all is
well despite the absolute shock of the departure of founder and bond market legend Bill Gross on Friday.
Allianz said that on -- on Monday, it said, rather, it remains fully committed to PIMCO. Our digital correspondent for CNN Money, Paul La
Monica, also our editor-at-large, has -- you've been following Bill Gross for years, we all have, known as the Bond King. Total shock, his
departure.
And then, "The Wall Street Journal" reporting today that clients had pulled out some $10 billion from PIMCO since news of his departure Friday.
Wow.
PAUL LA MONICA, CNN MONEY DIGITAL CORRESPONDENT: And this is just adding insult to injury, because it wasn't as if PIMCO was doing all that
well while Gross was there --
HARLOW: Right.
LA MONICA: -- recently. A lot of his bets on the Treasury market in particular have not panned out that great. So, PIMCO really has a struggle
on its hand right now, because Gross, despite some of the short-term issues with performance, he still is, as you point out, the Bond King, very well-
respected in investment circles.
Now there's a bit of a mystery. Even though we know who's going to be taking over, they're not as much of a known --
HARLOW: Well --
LA MONICA: -- commodity to the average investor that may have their funds -- money in some of these bond funds.
HARLOW: And I was thinking that. You think of PIMCO, at least for the average investor, you think of Bill Gross, Mohamed El-Erian. They're -
- neither of them are there now, and you have Gross's successor, Dan Ivascyn, if I'm pronouncing that right, clearly not a household name.
Does that matter? Because what PIMCO is saying, the CEO came out today and said, "The reason people choose us and ultimately stay with us is
our process and performance."
LA MONICA: That may be true, but it's hard to separate. Was the process and performance about Gross and El-Erian as well? And as you say,
neither of them are at PIMCO. El-Erian still has a presence at the parent company, Allianz, but he's not actually managing any money at the PIMCO
level.
I think investors may take a wait-and-see approach to see what happens to the performance of these funds. We don't know whether or not new PIMCO
managers are going to have a different strategy with regards to fixed income than Gross?
HARLOW: Right.
LA MONICA: And Gross isn't retiring. Gross has a new job at Janus.
HARLOW: Janus.
LA MONICA: So anyone that really still believes in him might be flocking to this fund that's going to be -- he's going to start running on
October 6th.
HARLOW: And we know that Gross oversaw, managed about $300 billion in assets. Some people say, though, he had influence over a lot more than
that. Morgan Stanley did some calculations. They came out saying that they believe investors could -- could -- pull $400 billion out of PIMCO
following this departure. Is that man worth this much?
LA MONICA: I'm not so sure. It seems a little hyperbolic to me, because based on what it sounds like Morgan Stanley did was they really
just did some back of the envelope calculations based on what happened to Allianz stock on Friday.
HARLOW: Right. Right.
LA MONICA: One day's move in a stock does not mean that it's the end of the world for Allianz and PIMCO. But yes, he clearly is worth a lot to
PIMCO, and he was worth a lot to Janus, because that stock surged on Friday. It has pulled back on Monday, maybe a bit of a reality check.
HARLOW: Right. He's not taking much of a vacation, though.
LA MONICA: No.
HARLOW: He's already started there.
LA MONICA: He's already started at Janus.
HARLOW: He's already started. We'll be watching it, Paul. Thank you for the reporting throughout.
LA MONICA: Thank you, Poppy.
HARLOW: A lot more on that story. We continue to follow it, of course, on CNN Money.
But coming up next here on the program, India's prime minister is getting absolute rock star treatment on his tour of the United States. As
Mr. Modi goes to Washington, we're going to explore which CEOs are lining up to hear his sales pitch to corporate America. That is next on QUEST
MEANS BUSINESS.
(COMMERCIAL BREAK)
HARLOW: Chief executives are joining the throng of people in the United States hoping to get some face time with India's new prime minister.
This weekend in New York, Narendra Modi ranked alongside, well, Michael Jackson and the Rolling Stones. He sold out Madison Square Garden.
His real work started earlier today. He had a breakfast meeting with executives from Google, CitiGroup, Merck, Caterpillar, MasterCard and
Pepsi. In the next few hours, he is having one-on-one sit-down meetings with Lloyd Blankfein, the chief executive of Goldman Sachs, James McNerney
of Boeing, Ginni Rometty of IBM, and also Jeff Immelt, the chief of General Electric.
He has a very busy day, I guess, underway, well underway. Tonight, he heads to Washington, DC and -- where else? -- the White House. He will
meet US president Barack Obama. Our global affairs correspondent Elise Labott joins me now. What a welcome for Modi, new in office, and sort of
an unknown when it comes to business, but everyone wants a little bit of his time.
ELISE LABOTT, CNN GLOBAL AFFAIRS CORRESPONDENT: That's right, Poppy. He was really treated as a rock star here in New York, selling out Madison
Square Garden, these rock star crowds. He also met with New York Mayor de Blasio --
HARLOW: Right.
LABOTT: -- other mayors and governors. This is really an effort, here, to paint a picture for India as the kind of new India. If you
remember, President Obama said that the US-India relationship would be the defining relationship of the 21st century --
HARLOW: Wow.
LABOTT: -- but it really never got back on track, so I think --
HARLOW: So, this is that chance.
LABOTT: -- an effort to what officials here in the US are calling "reinvigorate" the relationship.
HARLOW: But it's important to point out -- and you've noted this -- that he's very clearly said, we will be your partner, but we will also be a
formidable competitor to you.
LABOTT: That's right. In his speech at Madison Square Garden, he said -- he told a lot of Indian-Americans there, obviously, said India will
lead the next century. And he's saying over the next next ten years, he really wants to position India as a global leader.
And the way he's kind of painting himself. He met with Prime Minister Netanyahu of Israel. He's really kind of pulling out all the stops to
paint this new position of India as a global leader, as an innovator.
He said to the crowd yesterday in Madison Square Garden, "We're not snake charmers." There's this antiquated view of India. "We are the
leader and we are going to be a player going forward."
HARLOW: What do you think the United States is most eager -- not just the US, the West -- is most eager to gain from India? And what do you
think India gains from a very strong relationship with the West?
LABOTT: Well, I think for Prime Minister Modi, he wants to create business deals with the US that are going to create jobs in India. A lot
of the population is young, it's going to be entering the workforce. And he's going to be under the gun to create this next century for the young
generation.
(CROSSTALK)
HARLOW: But some of those higher-paying jobs, right? Not just a call center as -- manufacturing.
LABOTT: Or chai wallahs, that sort of thing.
HARLOW: Right?
LABOTT: No. He wants big deals with the Googles, with the IBMs, with the Goldman Sachs. And that's why he's really trying to woo investors
right now. And for the United States, they want a couple of things. Obviously, India is a huge market for the United States, and they want --
the economic relationship is very important to them.
But they would like India to be more of a constructive player on the world stage. They're not really doing so much as far as Syria, really
helping out. Still doing trade deals with Iran.
HARLOW: Right.
LABOTT: And there are issues related to trade, economics, climate change. And I think if you listen to Prime Minister Modi, not only does he
want good relationships with the United States and says but we'll be a formidable competitor, but he's also saying, listen, we're not going to be
your puppet, and don't talk to us about criticizing Russia on Ukraine --
HARLOW: Right.
LABOTT: -- and don't talk to us about criticizing China, what it's doing in Asia.
HARLOW: You do that fight.
LABOTT: You do that fight. We want good relationship with everybody. And oh, by the way, sometimes the West doesn't know so much. And so, I
think he does -- definitely wants to follow in the tradition of being a counterweight to the United States, to the West, with Russia and China.
I think he's going to try to play both ends against the middle. Wants that economic relationship, also wants to be a global player with some of
these other people that don't always think US knows best.
HARLOW: Yes, well, obviously, representing whatever is best for his people and his country. Talk is one thing, action is another. A lot of
talk right now in New York and Washington.
LABOTT: That's right.
HARLOW: We'll see what happens. Elise, thank you. Appreciate it.
The Nobel Peace Prize winner Muhammad Yunus says that business leaders have an enormous -- enormous -- role to play to end global poverty. Yunus
won the Nobel Peace Prize in 2006 after pioneering micro credit loans in the developing world. He told our Ralitsa Vassileva that social inequality
still does not get the attention that it deserves.
(BEGIN VIDEOTAPE)
MUHAMMAD YUNUS, 2006 NOBEL PEACE PRIZE LAUREATE: This is about the injustices that we have in our society, tolerating it over and over years.
Nobody pays attention to it. Poverty is one. There's a massive injustice that goes in. Income disparities. Huge income disparity globally. And
nobody pays any attention, as if making money is fine, being poor is also fine.
So, how do you address that? Why should society or the world community have some few people have all the massing of the wealth and all
the mass of people not having anything? So this is another one. Climate change is able to have -- people's lives are threatened by climate change.
RALITSA VASSILEVA, CNN INTERNATIONAL CORRESPONDENT: Let me ask you this. We do see a lot of summits. People getting together, huge names.
But solutions come up, but they're not implemented.
You are a person who actually has been able to implement a big idea, which has helped a lot of people. How do you get this summit to come up
with something that really works on the ground?
YUNUS: Yes. When we get together, we bring those examples of what works, so that people see. When we talk about poverty, it's not about some
sympathy for poor people. There are actions that can take people out of poverty.
We talk about micro credit. We have been doing it, we have done all over the world. It became popular. And it helps. And that challenges the
whole banking system, the whole financial system.
The way we have designed the whole world, financial system plays an enormous role. They are the ones who supporting -- providing the financial
services to the people who are extremely lucky already. They're not paying attention to the lucky people at the top -- the bottom. So how do you --
(CROSSTALK)
VASSILEVA: So let me ask you --
YUNUS: -- bring that services to the people?
VASSILEVA: You have an idea of how to bring those lucky people. You argue in your book, which is about social business --
YUNUS: Exactly, yes.
VASSILEVA: -- your concept -- that the lucky people, the profitable people --
YUNUS: Yes.
VASSILEVA: -- they are not just profit-making, money-making robots. They also want to give of themselves.
YUNUS: Absolutely.
VASSILEVA: Explain to us how this works.
YUNUS: Yes. Saying that now we only do one kind of business, business to make money, that's what we recognize, that's what we create all
the financial -- all the institutions to support them. I said there could be another kind of business, a business to solve problems, without having
an intention of personally benefiting from that. These we call social businesses.
Every problem that we see -- poverty, poor health care services, or climate change or unemployment. Any one of them can be addressed by
creating social businesses.
(END VIDEOTAPE)
HARLOW: Ralitsa, thank you for that fascinating interview. Coming up next on the program, the sheer scale of the protests in Hong Kong has taken
many around the world by surprise, but the picture is very different for the 1.3 billion people in Hong Kong's neighbor, that is mainland China.
We'll show you what they're seeing and what they're not seeing, right after this.
(COMMERCIAL BREAK)
HARLOW: Welcome back. I'm Poppy Harlow. Here are your world headlines. This is the scene on the streets of Hong Kong. Thousands of
protestors are still demonstrating for full democracy. They're protesting China's decision to allow only candidates vetted by Beijing to run for
chief executive of Hong Kong.
Meantime, ISIS militants are advancing towards the Syrian city of Kobani near the Turkish border. If the city falls, it will mean ISIS
controls a stretch of land from the border to their stronghold of Raqqa, some 100 kilometers away.
As the world focuses on beating back ISIS, Israeli prime minister Benjamin Netanyahu has warned the United Nations not to overlook the
threats posed by Iran and Hamas. Speaking at the U.N. general assembly, Mr. Netanyahu said that ISIS and Hamas are quote "branches of the same
poisonous tree."
Rescue work is being suspended for the moment on Japanese volcano Mount Ontake. It became a health risk for crews after the volcano started
releasing toxic gas. The bodies of 24 hikers remain on the mountain while many are still missing after the volcano erupted suddenly on Saturday.
All professional sporting events in Greece this weekend have been cancelled, called off by the government after the death of a football fan
on Monday. The fan died after suffering injuries two weeks ago near a stadium in Crete. The Greek government says it is canceling football and
basketball games in response.
Well, images of the pro-democracy protests in Hong Kong have been broadcast around the world. The citizens in Mainland, China are getting a
very different view. Let's take a look here. The few TV reporters that mentioned the protests have been short on details. For example, about the
clashes between demonstrators and police. They have avoided showing pictures of the demonstrations meaning you're not seeing any of this there
on Mainland, China. Some reports on CNN are being blacked out as well.
Let's also take a look at this - the newspapers, news websites kept off the story in terms of putting it on the home page - you're not seeing
that at all. They featured officials condemning the protests rather as illegal. And also this is what you're not seeing in Mainland, China -
censors blocking Instagram after thousands of images from the protests were posted of course using this app. On Weibo, China's equivalent of Twitter,
searches for Instagram were blocked. Facebook, YouTube and Twitter also all blocked in China.
Well the crackdown on social media hasn't extended to Hong Kong. Protestors there are already taking steps to try to protect themselves from
any sort of censorship. They're using an app increasingly called FireChat. This allows them to chat/talk with one another without any need for a
cellular connection or an internet connection. No Wi-Fi is needed. A stunning number - more than 100,000 people in Hong Kong downloaded this app
in less than 24 hours - from Sunday morning to Monday morning. It is a major coup for an app that boasts just a few million users worldwide.
Earlier today we spoke with Micha Benoliel. He is the chief executive of Open Garden. That is the company that created the app. I asked him why he
thinks protestors are choosing to use this so much right now.
(BEGIN VIDEOCLIP)
MICHA BENOLIEL, CEO, OPEN GARDEN: Protestors are very well organized. They are well prepared and they knew that at some point the cellular
networks would be shut down or would just be overloaded by the number of people gathered there in the same place. And so they knew that FireChat is
a way to remain connected and communication in case the other network goes down, and that's why they this app.
HARLOW: When you and your team were developing this, did you think that this is a way in which it would be used during protests like this?
BENOLIEL: So originally we did lots of technology to enable better access to the internet in many different situations - for large events,
conferences, big venues or during festivals like in Dawning (ph) Mandarin (ph) during the summer.
HARLOW: Right.
BENOLIEL: And, yes, we had an idea it would also be used during large crowds like protests. But we didn't think that people would be using the
app to that extent.
HARLOW: Is there anything that you would warn users not to do on this? Not to use - some have said don't use your real name for example.
Why would that be?
BENOLIEL: So I think protestors are very well aware and they know how to use the app. They, yes, we recommend people not to use their real names
obviously because all the conversations are public, and when you create a room on FireChat, everyone can join them. But people are - I mean, do
pretty well and they use just fake user names and (inaudible) do that and their identity is not exposed.
HARLOW: Do you have any desire to sell? I mean, look at how much publicity, how much attention FireChat is getting right now, do you want to
sell the company?
BENOLIEL: We haven't built the company to sell it -- yet. I mean, I think we are really just at the beginning of what this technology and
FireChat can create in terms of new possibilities for better communication. And so we keep on improving the application which is really at its early
beginning.
(END VIDEOCLIP)
HARLOW: Our business correspondent Samuel Burke has been tracking the issue of censorship and social media in China for a long time. He joins me
now. First of all, FireChat, if you don't know the name, know the name because this company is becoming increasingly important by the hour. Go
ahead.
SAMUEL BURKE, BUSINESS CORRESPONDENT: It's interesting. It's been around for a while. The reason people are turning to that app -
HARLOW: Yes.
BURKE: -- inside Hong Kong isn't because Instagram is being blocked I Hong Kong. Remember, that's just in Mainland, China. The reason why is
because they're finding they have very slow cellular internet connections. You've covered lots of protests even here in New York -
HARLOW: Yes.
BURKE: -- and you know, whenever everybody's trying to do something at once, it can slow things down. So they're turning to FireChat app
because it doesn't use an internet connection, so it doesn't slow them down.
HARLOW: What about Instagram? Just getting completely censored/blocked in Mainland, China? Not though in Hong Kong yet.
BURKE: Well it's interesting because it have evaded censorship before this.
HARLOW: Yes.
BURKE: It wasn't like Facebook, YouTube and Twitter -
HARLOW: Why?
BURKE: -- which had been blocked. It happens little by little we've seen over the years. And sometimes people think blocks are just temporary.
Earlier in the year, people thought that there were a wave of temporary blocks because of the anniversary of Tiananmen Square, and people thought
the blocks were going come right back down, but they didn't. What you're seeing on your screen right now actually, Poppy, is a site called
BlockedinChina.net You can go on this website and check any site, any platform that you want - that's Instagram I typed in there - and you can
see -
HARLOW: And supposed that site may be blocked in China too?
BURKE: -- could be. But if you look at the list there, every city, every region where they report on whether they're blocked or not is blocked
- Beijing, --
HARLOW: Right.
BURKE: -- Shenzhen, Yunnan Province. That's all the places where Instagram is blocked.
HARLOW: Yes, and all huge population centers as well. This is all part of a bigger crackdown in China, but then you hear chief executives of
Google, all the big tech companies also talking about the importance of China as a market. Look at the rise of Alibaba. So where is the middle
ground here? Or is there one?
BURKE: It seems like they might actually be losing some middle ground in China. You're right - no executive wants to admit that they could be
losing ground there. But reality is, Google, for example, is keeling (ph) the pinch. More and more they're being squeezed within China. Their
search engine market share search in China is going down. And it's not just the affecting search. So many businesses - multinational companies
that have offices in China - are feeling that pinch. They use g-mail with their office employees, they use Google Calendar maybe the way you and I
would, and if those tools are unavailable -
HARLOW: Right.
BURKE: -- it makes doing business a lot more difficult. So some people are considering places like Singapore - fast internet connections -
HARLOW: Sure.
BURKE: -- no blockage.
HARLOW: Very business friendly.
BURKE: Exactly.
HARLOW: We'll be tracking that. Samuel, thank you. Good to have you on the program. Coming up next, security across Africa. Uganda's finance
minister explains how her country grapples with the threat of terrorism.
(COMMERCIAL BREAK)
HARLOW: African nations cannot become complacent. That is the message of Mo Ibrahim, the Sudanese billionaire, created a foundation back
in 2006 to monitor and track development across Africa, and its latest annual index came out on Monday. Mauritius was rated the top country. It
was strong on safety and on human rights. The most improved nation - the Ivory Coast. It also made gains in human rights. The most deterioration
though was seen in Egypt with the recent revolutions, it received low rankings for safety and of course the rule of law.
This report also showed that countries in Africa which are usually top performers did slip back in at least one of those critical categories. So
we asked Abrahim why.
(END VIDEOCLIP)
MO IBRAHIM, FOUNDER AND CHAIRMAN, MO IBRAHIM FOUNDATION: What we see is the top five countries were still at the top five, still up there and
they are still improving. But each one of them declined in one of the four main categories. So we're just saying you are good guys but watch out
because you're slipping in one area or so.
HARLOW: You did issue a warning in this report, even to the top five performers, saying, "Do not be complacent."
IBRAHIM: Absolutely.
HARLOW: Tell me about that.
IBRAHIM: Absolutely. While we are delighted that these four countries still surging ahead - and by the way, they have been the same top
five for the last 12 years or so because we have the (inaudible) actually for ten years now - and they have been top all the time which is great.
But it doesn't mean we (inaudible) because we noticed in some areas they start to slip - in the area of rule of law, one in the economic development
area. There is one - because we have four main categories to describe governments, and we hope we have a balanced development that people can
progress across all categories of governance. These are the pillars on which governance rests. So we need hope that it is stable and not tilted.
HARLOW: What the data shows is that 41 of the countries showed progress in human development, 39 saw improvement in government
performance. But very real threats still exist. Boko Haram is a huge one - a huge threat for Africa. Also reputationally. How big of an impact do
you think that that is having?
IBRAHIM: One area where Africa actually is not making progress actually it is the regressing. It is the area of security and safety which
is (inaudible).
HARLOW: Yes.
IBRAHIM: What we noticed is increase on the violent deaths numbers and the conflicts. But the conflicts have changed. In the past, conflict
was across borders. We don't -- now we don't have conflicts across borders. All the conflicts we have happen to be internal conflicts. And
that raises a question -- what is the problem here? Are we marginalizing some of our communities? Are we discriminating on some people? Are there
fault lines appearing on the fabric of our societies? Why? We have this increase of level of conflicts within our - within each countries. Of
course the conflicts are not in every African country - maybe there are eight or nine countries which have some conflicts. But this is a serious
problem we need to deal with.
(END VIDEOCLIP)
HARLOW: Well Uganda ranked 19 out of 52 on that index. Our Richard Quest spoke to the country's finance minister and asked about the threat
terrorism poses to security there.
(BEGIN VIDEOCLIP)
MARIA KIWANUKA, UGANDA FINANCE MINISTER: We had our own big tragedy a few years ago at the World Cup of 2010 when our stadium was bombed and 70
people were killed who had been watching - who had been watching the final - finals of the World Cup. And what our government was to move in very,
very fast. First of all, make sure everyone was, you know, received medical treatment but also start tracking the perpetuators. And they were
-- the suspects were - arrested and being subject to due process. But it became a way of life in Uganda to be vigilant - to check. People are quite
willing to be checked when they're going into public places, when they're told not to leave bags lying around.
RICHARD QUEST, CNN INTERNATIONAL ANCHOR AND REPORTER HOST OF "QUEST MEANS BUSINESS" SHOW: Do you think that as a society we have to readdress
this balance between say privacy, rights to, you know - individual rights - versus the needs of security? We have to consider where that tradeoff
comes.
KIWANUKA: We do. We do have to consider where that tradeoff comes. And I think on the individual level it comes down to if you don't want to
submit yourself to security, then (ph) don't go there. Because as -- we have a saying in my language that you have to be vigilant all the time with
your security but the thief only has to be let in (ph) once.
(BEGIN VIDEOCLIP)
HARLOW: Interesting interview there. Also this news just in to CNN this hour. Shares of Ford Motor Company down 7 and 1/2 percent. In after-
hours trading the automaker is set to report pre-tax profits of $6 billion for the year, but that is significantly worse than the $7 to 8 billion
goal. The automaker was hurt by poor results in South America and Europe. This is the first quarterly report under their new CEO Mark Fields.
Also let's take a look at the weather - how things are looking in Europe. Tom Sater joins us from the International Weather Center. Not
looking that nice, is it?
TOM SATER, METEOROLOGIST FOR CNN INTERNATIONAL: In some areas it's not looking very good at all. But overall, Poppy, across Europe, I mean it
was a splendid first fall weekend. In fact the numbers were outstanding from London to Paris to Berlin to Oktoberfest in Munich of course. Look at
the current numbers - 15 in London. It's still 18 in Paris and 19 in Berlin. Oh, you got the same numbers - it's even warmer in Berlin than it
is in Madrid right now although the sky's opened up in Southern France. So it's more than just a nuisance rain as you see here in Montpelier. I mean,
we're looking at staggering numbers, and I share those with you.
From this view it's hard to tell, but we call it training. The boxcars of a train. One thunderstorm after another just riding over the
same area, causing some flash flooding. Had some pretty good storms make their way up into Belgium as well. But the Satellite picture really shows
the explosiveness of the convective activity. And we've got a lot more to put up with. But the numbers already are quite impressive. So, again, as
they have been moving in and more to come, it really was between 2 p.m. and 6 p.m. I mean look at these numbers - 269 millimeters here just between 2
and 6. The monthly average is 80 millimeters, and when you break it down - I mean this is something - 290 fell in twelve hours. That's more than all
of the September and October average rainfall. And these are the two rainiest months of the year. For the year you get 229 - almost 50 percent
of your yearly average. So we have pictures like this.
Again, it's Southern France, this is what we're watching. Montpelier - you can just see just the flooding that they're contending with,
disrupting travel, business to say the least. This is really the eyesore and the one problem spot that we're finding really across Europe at this
time. So, again, it's going to be a while because there's much more to come. Satellite picture and the forecast shows a little bit more rainfall
as we come back here, starts to make its way into parts of Europe, but overall this is where we're going to find our trouble spot again for the
overnight hours, Poppy, and into Tuesday morning. Hang in there.
HARLOW: I don't even want to tell you how lovely it's been here in New York City.
SATER: It is been nice. Yes. It's very nice.
HARLOW: Because, wow, those images were pretty stunning. Thank you, appreciate it, Tom. Coming up next on the program, something fun for you.
It is one of the biggest events on the fashion calendar - Paris Fashion Week is here once again. We go behind the scenes to show you exactly how a
catwalk king works his magic.
(COMMERCIAL BREAK)
HARLOW: Right now trendsetters are critiquing the work of some of the world's top designers at Paris Fashion Week. As always, this year's
catwalks have been an exhibit of elegance and style. But behind the scenes there's a huge amount of hard work, a lot of planning as well going on.
Myleene Klass introduces us to one man who keeps those runways running.
(BEGIN VIDEOCLIP)
(MUSIC PLAYS)
MYLEENE KLASS, HOST OF "FASHION SEASON: PARIS": Etienne Russo is a conductor of sorts. By orchestrating lights, choreography, stage set and
music, he creates theatrical spectacles that sing the brand message of the world's most prestigious fashion houses.
ETIENNE RUSSO, FOUNDER, VILLA EUGENE: We are the package, we are - but the priority is the collections.
KLASS: That packaging has made him and his Brussels-based company Villa Eugene one of the most sought-after in the industry. He produces
around 70 shows a year and no demand is too great. A table that transforms into a catwalk for Dries van Noten - done, a wall of ice for Y-3 - as
requested, 100 white vintage cars for Kuls (ph).
RUSSO: I think the craziest are the one to come, because you know what you have behind you somehow has been done, so what I'm looking for
now, it's always like what is new - what is it that I haven't touched?
KLASS: This season he has developed something simple and sophisticated for the classic French House Lanvin. And something
experimental and groundbreaking for the cutting-edge Kenzo.
RUSSO: Basically Lanvin is all about simplicity. The lighting was so important for the girls, and the simplicity of the show here, we have kind
of a younger spirit, so we have videos, we have an avatar.
KLASS: Etienne is always led by the collection, and the design is DNA. But he also listens to the environment.
RUSSO: I love to listen through the walls and say and tell me what they have to say. This says something - there is the light - soul (ph)
that are printed in venues. And sometime you go and it makes you feel - oh, wow - you want to go this direction. In other words, you want to go in
another direction. You have to feel it here. If you feel it here and you love it there, then hear you make it work.
KLASS: The first time he knows whether that instinct is right is at the rehearsals just before the show. He makes sure every light is in
place, every musical beat is on time and every model is on the right line.
RUSSO: Now today we have the social media. How (ph) it's like everything has to be so visual and televisual before you have time to
retouch a little bit. No, today there are programs - you take the picture, the moment you take the pictures it's online already. Five minutes before
the show and you say, `oh my goodness, is this going to work?' But doubt is what make you go forward - it's a fuel for me - the doubts. When I stop
having butterflies in my stomach just before the show starts, then I will think I'm done with this job. I have to do something else.
KLASS: At times the designers have chosen to change the music, choreography or lighting just minutes to go.
RUSSO: Until you start the show, and even during the show, you still can change things. Standing by everybody? So you have to be quick on
smelling things, on sensing them and say, `More there, more there.'
KLASS: As the audience take to their seats, Etienne takes up his baton.
RUSSO: Three, two, one - start show.
KLASS: Six months of work comes down to just seven minutes on the catwalk. He knows when it's a hit.
RUSSO: You feel it. It's the intensity that there is in the room - the electricity there is in the room at the moment the applause.
KLASS: Etienne's shows always get the town talking. He's produced over 1,000 of them, and as long as the butterflies keep on fluttering in
his stomach, there will be many more to come. Myleene Klass, CNN Paris.
(END VIDEOCLIP)
HARLOW: Beautifully done. Of course our top story on the program tonight - defiance on the streets of Hong Kong. Pro-democracy protestors
refusing to back down. We'll have an update next.
(COMMERCIAL BREAK)
HARLOW: A recap of our top story tonight. Thousands of pro-democracy protestors camped out in Hong Kong show no sign of leaving. The protest is
the largest in Hong Kong since the U.K. handed the city over to China in 1997. The demonstrations were sparked by China's decision to only allow
candidates vetted by Beijing to run in Hong Kong's 2017 elections. Speaking earlier to reporters in Washington, White House Press Secretary
Josh Earnest said the United States is watching the situation very closely.
(BEGIN VIDEOCLIP)
JOSH EARNEST, WHITE HOUSE PRESS SECRETARY: The United States urges the Hong Kong authorities to exercise restraint and for protestors to
express their views peacefully. The United States supports universal suffrage in Hong Kong in accordance with the basic law, and we support the
aspirations of the Hong Kong people. We believe that an open society with the highest possible degree of autonomy and governed by the rule of law is
essential for Hong Kong's stability and prosperity. Indeed, this is what has made Hong Kong such a successful and truly global city to this point.
(END VIDEOCLIP)
HARLOW: And that is "Quest Means Business" this evening. I'm Poppy Harlow. Thank you so much for joining us.
END
