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Quest Means Business
Oil Surges After OPEC Pledges Cooperation; US Stocks Fall Again; Possible Rate Hike From Fed; Growth Slowdown Hits Chinese Industrial Hubs; Merkel Urges Europe to Act on Migrant Crisis; Thousands Flee War, Flood EU Borders; Europe Divided on How to Handle Migrant Crisis; Maria Sharapova Pulls Out of US Open. Aired 4-5p ET.
Aired August 31, 2015 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:05] (NEW YORK STOCK EXCHANGE CLOSING BELL)
RICHARD QUEST, HOST: Mr. Copeland doing a fine job ringing the closing bell.
(GAVEL POUNDS)
QUEST: Now, that's what you call a real gavel! None of the wimpy gavelers. Well, that's what you'd expect from the American Ballet Theater,
celebrating their 75th anniversary. Mr. Copeland, the market was down, it's Monday, it's the 31st of August.
Tonight, black gold bounces back. Oil prices surge higher as OPEC says it may be time to talk.
Angela Merkel demands action on EU's migrant crisis, and Europe's migrant envoy tells me not everyone can stay.
And the billionaire blues. The creator of Minecraft tweets, "Money has made me miserable."
I'm Richard Quest. We start a new week together, and I mean business.
Good evening. Welcome to another week of QUEST MEANS BUSINESS, and we begin tonight with OPEC, which announced it stands ready to talk, and oil
prices are ready to surge. The surge to some extent has already begun. Come and have a look at the super screens and you'll see what I mean.
Now, oil prices are up over 8 percent just on the Monday trade alone. This is West Texas and it's also Brent, and there you see the two moving.
Brent is higher than -- well, it isn't always higher, but at the moment, Brent is higher than West Texas Intermediate. WTI is now trading at
$48.60, Brent's just over $53 and change.
And over the past three sessions, the market -- the oil market has been up more than 23 percent. And of course, the fall in the price of oil
was very much one of those major factors which were driving or was talking about driving the stock market crash of the last couple of days.
And the reason is, OPEC apparently says it's willing to talk about reaching a fair price with other producers. According to OPEC,
"Cooperation holds the key to oil's future. The organization stands ready to talk to all other producers." The hope, of course, is that OPEC somehow
might come to some agreement at least to reduce the oversupply of crude in the market.
On Wall Street, the Dow Jones Industrials, they fell, but not terribly. If you look at -- certainly off the best of the day. The low
point of the day was quite early on, down just 115 points, a loss of just over half a percent.
Paul La Monica is with us. We have two things we have to get to grips with: oil and markets. So, what happened with oil?
PAUL LA MONICA, CNN MONEY DIGITAL CORRESPONDENT: Oil, it was a remarkable run since that OPEC report came out that you mentioned. It does
seem that maybe OPEC finally realizes that they have to blink in some respects and maybe not produce as much. Obviously, the United States will
probably have to do the same. But it's been this game of brinkmanship for a while now.
QUEST: Right. But it's harder for the United States to blink because you have to rely on individual producers to cut back.
LA MONICA: Exactly.
QUEST: Whereas OPEC, it's a government fiat that says cut. But this is what OPEC said in its statement. It says it's causing concern for OPEC
and its members. Member countries -- apart from the obvious loss of revenue required for member countries' socioeconomic development, there are
fears that future capacity will be shelved.
LA MONICA: Right. There -- there have been reports of tension within the members of OPEC pretty much since last Thanksgiving when Saudi Arabia
led the decision to not pull back on production, and obviously, not every OPEC nation is happy with oil prices at these levels. They are just so low
compared to where they were a year ago.
QUEST: Do you take this as being OPEC blinking?
LA MONICA: I'm not sure I'd go so -- that far just yet, but it is a sign in the right direction from the market's perspective. They clearly
are happy that we might finally start to see some production cuts.
QUEST: OK. And oil price -- oil stocks, not surprisingly, also rising sharply. The Dow was off a 115 or so points. The driving factor
there -- we were down sharply in Asia, once again in Shanghai. Europe middling. But what happened here?
LA MONICA: Yes, we had at the beginning of the day, Dow down nearly 200 points. Some stabilization as the day wore on. I think as the month
ends, people are now looking back, reflecting, this is the worst month for the Dow since May 2010, worst month for the S&P 500 since May 2012. Maybe
there could be --
(CROSSTALK)
QUEST: But if it --
LA MONICA: -- some buying at the end of the day.
[16:05:00] QUEST: But if you take 18,300 or so -- so, from its all- time high, where are we down?
LA MONICA: About 10 percent --
QUEST: Ten percent.
LA MONICA: -- we're right around that correction level, just below a correction level for the S&P 500 as well. And I think that's really the
big question on everyone's mind right now, is this just a correction, which is sorely needed, since we hadn't had one before last week --
QUEST: Right.
LA MONICA: -- since 2011? Or is it the beginning of a bear market?
QUEST: Oh!
LA MONICA: We just don't know yet.
QUEST: We don't know, and to those people -- to those of you that consistently tweet me regularly saying that it's a bear market, I don't how
you can know it --
LA MONICA: This isn't 2008.
QUEST: I'm sorry?
LA MONICA: This isn't 2008.
QUEST: It's not 2008.
LA MONICA: Let's hope that.
QUEST: Are you sure?
LA MONICA: You can never be sure, of course, but I -- you don't seem to have that contagion effect just yet. Obviously, concerns about China --
QUEST: All right.
LA MONICA: -- but we're not seeing that Wall Street ripple effect, crisis of confidence in the credit markets at all.
QUEST: Austan Goolsbee, is this 2008 all over again?
AUSTAN GOOLSBEE, FORMER CHAIRMAN, US COUNCIL OF ECONOMIC ADVISORS: Well, depends who you're talking about. If you're in China, I feel like
there is a decent chance that it is 2008 all over again. In the United States, I don't think it's 2008 because we aren't near as leveraged on this
as we were then.
In 2008, housing was the big story. We had a lot of debt on that housing, so when the values went down, we were in trouble.
QUEST: Right.
GOOLSBEE: And we're not in that situation this time.
QUEST: All right. Now, Austan, good to see you, thank you for being with us again to help us --
GOOLSBEE: Great to have me -- thanks for having me.
QUEST: -- navigate these waters. I want to talk about the Fed and what Stanley Fischer said at Jackson Hole in Wyoming at the Fed's get-
together. He gave a long and interesting speech, very technical speech, on inflation, but did you take what he said as being towards a September rise
or away form a September rise?
GOOLSBEE: Interpreted that way, I think most people took it as towards a September rise, or at least expressing more sentiments that maybe
the economy's stronger than we thought, that chance of inflation is higher than people are giving credit to.
QUEST: And therefore -- his last line was very good. "By the time you see inflation, it's too late to do anything about it," or whatever he
said. That's been your experience.
GOOLSBEE: Yes, he's kind of got the sunburn theory of inflation, that if you see that you're sunburned, it's too late, you should have put the
sunscreen on before.
Now, I must say for the record, I'm a huge Stan Fischer fan, he's my old teacher at MIT. On this point, I don't think I -- I think I disagree
and I don't quite agree with the conventional wisdom that seems to be coming out of the FOMC that they are just looking for a reason to raise the
rates. And if the world will just give them the slightest bit of stability, you can just feel them itching to get off the zero lower bound.
QUEST: But that makes sense!
(CROSSTALK)
GOOLSBEE: I think this --
QUEST: That makes --
GOOLSBEE: -- the matters in China are dangerous.
QUEST: That -- ah, well, I'm going to take it -- well, I hesitate to take issue with yourself, but surely there -- the history if replete with
examples. And monetary policy is so accommodative, it's not even marginally, it's almost incontinent it's so accommodative that taking a
little bit back off the table wouldn't do any harm.
GOOLSBEE: Maybe. You hope that's true, but you hope we don't repeat, say, Sweden or some other countries where they charge out and say the
economy has turned the corner, they raise rates, and then the next thing you know, they're actually in decline again, and they have to turn back on
themselves and once again take another heavy blow to their credibility. I think that's one of the dangers.
And I just think, is there really a big loss to wait two months or four months to figure out whether China is in a 2008-style event? I just
don't think -- I think the loss from starting one and then reversing is far higher than going the other way.
QUEST: Looking at oil coming back up again, is it your feeling OPEC's hurting so badly that they are deciding throw in the towel, do a deal, get
the price up?
GOOLSBEE: Yes and no. You said, is this OPEC blinking? I think they're wincing. They're not blinking. Because OPEC is not in control.
Most of the oil on the world market is not being produced by OPEC countries, and people have got to remember that. Cartels --
QUEST: Right.
GOOLSBEE: -- in collusion are hard enough when you dominate the market. I think they would like the price to be higher, but I think
they'll have a hard time even getting OPEC to agree, much less the non-OPEC countries.
QUEST: Austan, good to see you, sir. Thank you. We'll discuss these issues --
GOOLSBEE: Thanks for having me back.
QUEST: -- many more times. Lovely to have you with us.
[16:10:01] Now, on this question of oil, all this week, we're going to be looking at the global price war surrounding oil. The economic
slowdown in China is part of the fallout from the slide in crude prices. As Will Ripley now explains from Beijing, it's taking a toll on some of
China's industrial hubs.
(BEGIN VIDEOTAPE)
WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT (voice-over): This is China's version of Roman ruins: relics of rapid economic growth, left
crumbling by a changing economy. Tengzhou, a small industrial city by Chinese standards, 1.5 million people, a GDP bigger than Jamaica.
But the economic slowdown is taking a toll on people like Ma Xinqing and Wang Dishan. Each spent 20 years working at this machine factory.
"Business was bad," he says, "so they shut it down.
RIPLEY (on camera): So, what was in here?
RIPLEY (voice-over): Their job today, watch the empty buildings. Everyone else transferred or laid off. Fading factories, a familiar sight
in this neighborhood.
At the nearby marketplace, two thirds of Wang Changmei's customers are gone. "Of course I'm worried," she says. "I'm barely getting by."
The world's second-largest economy is still growing, but traditional factories pumping out cheap exports are no longer a booming business.
RIPLEY (on camera): For years, China paid top dollar for oil. Demand and prices were high. Factories like this, full of workers.
RIPLEY (voice-over): Today, they're cutting jobs, upgrading operations, moving to modern, energy-efficient facilities. Combined with
declining auto sales, the world's largest energy consumer, which pumped up oil prices for years, is now driving them down. These 65-year-old factory
workers aren't sure where they fit in China's new normal.
RIPLEY (on camera): What's it like being here, and it's just quiet all the time?
RIPLEY (voice-over): "Just two old men. It's boring. Nothing to do," he says, "so we just started farming while watching this place."
Before the reforms, before Chinese industry became robust, Ma and Wang were farmers. Now, once again, they find themselves tending crops,
surrounded by reminders of their past, left behind, wondering about their future.
RIPLEY (on camera): You're even growing pomegranates, I see.
RIPLEY (voice-over): Will Ripley, CNN, Tengzhou, China.
(END VIDEOTAPE)
QUEST: As we continue tonight, desperate journeys across, crossing borders, and a struggle that just seemingly doesn't end. The refugees are
scrambling for trains to get to Germany, and the chancellor Merkel wants Europe to do more to help them. We're live in Berlin after the break,
QUEST MEANS BUSINESS.
(COMMERCIAL BREAK)
QUEST: Tonight, Europe's most powerful leaders call for more action to tackle the migrant crisis. The German chancellor, Angela Merkel, wants
governments to step up efforts to solve the human tragedy that's putting an unprecedented strain on borders across the continent.
Today, Hungary started letting some asylum seekers board trains that were bound for Germany. Hungarian officials want more legal information
from Germany on allowing Syrian refugees to travel over the border. Budapest is denying that migrants who have already reached Hungary are
allowed to travel onwards freely.
[16:15:05] The chancellor today praised Germans who have welcomed the refugees and reminded her fellow citizens this crisis won't be over soon.
(BEGIN VIDEO CLIP)
ANGELA MERKEL, CHANCELLOR OF GERMANY (through translator): That will be a central challenge, not only for days or months, but for a long period
of time. And that's why it's important that while we are saying that German efficiency is great, what we need now is German flexibility.
(END VIDEO CLIP)
QUEST: So, let us remind ourselves why these people are making this desperate journey in the first place. So, join me at the super screens,
and you'll see the sort of situation that we're talking about. It put its elegantly into perspective.
They're fleeing war and poverty in the Middle East and in North Africa, and they are doing so in record numbers, whether they're coming
from Syria over towards this way, up through Egypt, or towards Greece and further north via Hungary to Germany.
Reaching Hungary is the critical moment, because it's the first EU country within the Schengen zone on their route, and then Germany is their
top priority.
It's not just those countries affected. All summer refugees have been arriving in Italy, Greece, and Cyprus, whether they've been coming, as you
see, from parts of North Africa, across the waters of the Mediterranean, lethal journeys, or indeed taking from Syria land routes where they can,
through Turkey, and then up through this way, once again, passing by Romania, but ending up in Hungary.
And it's in Syria, it's the brutal civil war and the advance of ISIS. That's Syria. In Eritrea, it's government repression and military service.
There are also migrants from democratically stable countries, like Senegal, who are escaping poverty and seeking greater opportunities.
Whichever way you look at it, this is the map of migrant flows, which shows how things are moving at the moment. And to further complicate
matters, Europe's Schengen area. It's the zone that allows travel without passports.
Now, Chancellor Merkel says failure to fix the migrant crisis will put the Schengen agreement under pressure. But as long as you -- the gist of
the rule is, once you are in Schengen, you can travel anywhere freely. Here's what the chancellor said.
(BEGIN VIDEO CLIP)
MERKEL (through translator): I am simply saying that if we are unable to agree on a fair distribution of refugees within Europe, then some people
will start to call Schengen into question. We do not want that. We want a fair distribution of refugees, and then we won't need to discuss Schengen.
(END VIDEO CLIP)
QUEST: Our senior international correspondent Atika Shubert is with us live tonight from Berlin. Let's take this very point by point, if we
may, Atika. Germany is taking the lion's share, in many ways, of the refugees at the moment, isn't it?
ATIKA SHUBERT, CNN INTERNATIONAL CORRESPONDENT: That's right, the greatest number in the EU. It's promised to take 800,000 refugees. That's
four times the number it took in the previous year. So, it is opening its doors.
But the bigger question for refugees is even though they want to get here is how to get here legally, and that is the big stumbling block,
Richard.
QUEST: Now, what's this battle or this argument between Germany and Hungary? Because the refugees are entering -- as our map shows, the
refugees are coming up Macedonia, Serbia, into Hungary, which is their point of entry to Schengen. But why is this row over the trains?
SHUBERT: Well, as you know ,the Dublin Protocol essentially states that any refugee or asylum seeker must seek -- must register for asylum in
the first country they step foot in. For some, that's Hungary, for others, it's Greece or Italy, but it's rarely Germany.
So, what's happened is that by Germany saying, well, the Dublin protocol is not working, we will recognize Syrian and Iraqi refugees as
they are here in Germany. We will process them. It's opening the doors.
But how do they get here? Now, it happens that Hungary and Austria are the main routes. So, what's happened is this huge surge of refugees
packing onto trains, trying to get across. A lot of overcrowding and some serious security issues.
QUEST: Atika Shubert, who is in Berlin for us this evening.
On that question, Europe is divided on which option is the best way forward. Changing the asylum laws is one particular possibility. The
Dublin agreement says refugees should get asylum in the country they arrive in, as Atika was mentioning.
[16:19:56] The Italian foreign minister says the situation needs change. Everyone agrees it needs change. There may be burden sharing or
some form of quotas for different countries taking a predetermined number of people.
And then you've got the alternative approach, which is what's being seen in Hungary: tighter border controls. Austria, for example, stepping
up the controls between -- for lorries and for trucks crossing from Hungary.
I spoke to Pierre Vimont. He's the former executive secretary general of European External Action Service. He's the senior associate at
Carnegie, and I asked him, what is the best way forward?
(BEGIN VIDEOTAPE)
PIERRE VIMONT, SENIOR ASSOCIATE, CARNEGIE EUROPE: I think first of all, that's the only solution. Member states have shown so far that they
can't on their own individual action find a solution to these problems. They need the support of the European Union, and they need to work all
together.
At the moment, Italy, Greece, Hungary, France today, with what the meeting taking place in Calais, have shown that they need even as simply as
that, financial support from the European Union, from the European budget, in order to find the right shelters for the people to cope with the
immediate inflow of people.
Then, other possible answers have to deal with having a common list of safe countries. In other words, to try to make a distinction between
countries -- refugees from countries that are really in a strong political instability, think about Syria or think about other countries like
Afghanistan -- and those like the countries from Western Balkans, which are in a totally different situation.
QUEST: Right.
VIMONT: Of course, I put aside the whole issue of Syria, for instance, where people who are still living in Syria under the bombs of
either the regime or the infighting from the other side and from the jihadist movements are trying to escape that ordeal and trying to find safe
places.
And this is where, once again, we have to admit that we have to allow these people to come, if necessary, if they wish so, into Europe to find
protection.
But for all the others who are coming into Europe for different reasons -- economic reasons or other reasons, individual reasons -- for
these people, we have to try to convince them not to come.
QUEST: This is another example, sir, where Europe -- the structures of the union are going to -- were never designed for this. They're having
to make it up as they go along, and they're constantly sweeping up behind.
VIMONT: This is an inflow of immigrants that has taken every member state -- single member state somewhat by surprise. The amount of people
who are coming into Europe at the moment is huge, it's three times what it was last year. So, no need to say that everybody is taken by surprise.
The second point, as you very well know, and you alluded to that in your question, is that so far, we haven't yet a common European policy on
migration. We are building this slowly, step by step.
But I think what this crisis is showing is that there is an urgent need for that, and what you're going to witness in the next few days, few
weeks, and few months is precisely the setting up of such a policy. And I really hope, better and stronger solidarity among member states on this
issue.
(END VIDEOTAPE)
QUEST: Pierre Vimont, who is the special envoy of the EU Council president, Donald Tusk, to attend a summit with African leaders on migrants
in November.
When we come back in a moment, the United States goes to the net. We're going to hear from Maria Sharapova about her future on and off the
tennis court. A story, of course, made all the more interesting by her lapse in play.
(COMMERCIAL BREAK)
[16:25:46] QUEST: The US Open gets underway in New York, and one of the biggest stars of the game is not competing this year. Maria Sharapova
pulled out of the competition on Sunday because of a leg injury. Clare Sebastian spoke to Maria before she pulled out of the Open and asked about
her business ventures and an upcoming tennis exhibition that she's organized in Los Angeles.
(BEGIN VIDEOTAPE)
MARIA SHARAPOVA, FIVE-TIME GRAND SLAM TENNIS CHAMPION: It is an exhibition themed event, but yet, we are -- it's in a period of time when
we're getting ready of the Australian Open, so it's going to be quite a competitive atmosphere. And Kei Nishikori, Andy Roddick, and myself, among
many others, will be playing, and we'll treat it as a really great practice match just on the eve of the Australian Open.
CLARE SEBASTIAN, CNN PRODUCER: So, it's another string to your many strings, business -- well, you're almost as well-known for that, now, as
your tennis. You've got a new deal with AmEx, along with your 17-year relationship with Nike.
SHARAPOVA: Right.
SEBASTIAN: Talk to me about why it's so important to you to keep these relationships with these brands.
SHARAPOVA: I came from having to cut my t-shirts because there was not a junior line at the time, and rolling up my skirts to now being able
to design my on-court looks for Nike. And that involvement and that relationship has really evolved in these years, and it's a really special
feeling to be part of something so unique.
For me, it's always been about the learning process and understanding what works and doesn't and trying to do it better next time.
SEBASTIAN: Why is it so important for you to learn more about a the world of business? Is this something you're thinking about life after
tennis?
SHARAPOVA: When I had shoulder surgery six or seven years ago -- I keep forgetting every time -- but it gave me a chance to understand that
your tennis -- when you're a young girl, you just -- that's something that you do every single day. You pick up a racquet, you go train, you play a
tournament.
And then, when you're held back from that, you realize that at a certain time, especially for a woman, you'll have a family and you'll have
children, and you won't be playing tennis anymore. So, that really gave me a chance to think about life after tennis and the things I wanted to be a
part of.
And my manager and I, we get together and we brainstorm about my passions and things that I would want to explore and do.
SEBASTIAN: I mean you've been hugely successful. You're seen as the most marketable -- well, you only have that title, the most marketable
woman in tennis. What does that mean to you alongside your tennis achievements?
SHARAPOVA: I don't think it's something that I think of at all, actually. I think it makes me much more proud to hear how many grand slams
I've won or that I was the number one in the world, or that I won Wimbledon at 17 years old. Those are the things that make me smile.
I think all the projects that I've been a part of have been incredible and have taught me so much, but I think the headlines that people create
for yourselves, people do that for you, and I'm the one that's going out and winning tennis matches.
(END VIDEOTAPE)
QUEST: Maria Sharapova talking to Clare Sebastian.
Now, President Obama is on his way at the moment to Alaska. When he gets there, he's going to push his climate change initiative. We'll see if
he can expect a frosty reception from the oil companies. QUEST MEANS BUSINESS.
(RINGS BELL)
[16:29:00] (COMMERCIAL BREAK)
[16:31:19] RICHARD QUEST, CNN INTERNATIONAL ANCHOR AND REPORTER HOST OF "QUEST MEANS BUSINESS" SHOW: Hello, I'm Richard Quest. There's more
"Quest Means Business" in just a moment when Ashley Madison insists it's business as usual despite the recent data hack.
And Microsoft gave him billions of dollars, now the creator of Minecraft complains he can't find anyone to love. I'm sure there's a
connection between those stories somewhere but I ain't touching it with a damn (ph) football.
Before all of that, this is CNN and on this network the news always comes first.
In an unexpected move, Hungary has allowed Syrian and Iraqi refugees to board trains bound for Germany and Austria. Hundreds of refugees have
now arrived in Munich on a train that traveled from Hungary.
German Chancellor Angela Merkel has called for the rest of the European Union to take urgent action on the growing number of migrants
heading to Europe. Italy's foreign minister told Becky Anderson the E.U. needs a collective overhaul of its rules on claiming asylum.
(BEGIN VIDEOCLIP)
PAOLO GENTILONI, ITALIAN FOREIGN MINISTER: Obviously we have to share this European asylum with rules because without rules everybody would
choose to go in Sweden or in Germany. So we need rules but we need to accept the -
BECKY ANDERSON, CNN HOST, "CONNECT THE WORLD": OK -
GENTILONI: -- principle that the migrants are not entering Italy or Greece, they are entering Europe.
(END VIDEOCLIP)
QUEST: Ukraine's government says violent protests in Kiev have left one soldier dead and at least 122 others injured. Demonstrators clashed
with police outside Parliament after lawmakers backed a measure that would allow more autonomy to separatists in the region.
The Ukrainian President Petro Poroshenko says right-wing nationalists were behind the violence.
(BEGIN VIDEOCLIP)
PETRO POROSHENKO, UKRAINIAN PRESIDENT, VIA INTERPRETER: Thanks to the diplomatic efforts last week including my direct involvement during the
visit to Brussels, it has been three days in a row with not a single shot from the heavy artillery was fired on the front line.
It has been three days without a single Ukrainian soldier was killed in action. On the other hand, someone kills defenders of the homeland here
in Kiev for the sake of advertising their party banners and several seats in the district council.
Whose plans did the so-called patriots fulfill today? The answer is obvious.
(END VIDEOCLIP)
QUEST: Police in Thailand are looking for a man and a woman in connection with this month's deadly Bangkok bombing.
Authorities issued arrest warrants after discovering bomb-making material at an apartment in the city's suburbs. The woman's mother says
her daughter left for Turkey two months ago.
An antiquities official says the columns of a 2,000-year old temple in the ancient Syrian city of Palmyra are still standing. ISIS had reportedly
destroyed part of the temple of Bel.
An explosion went off within the walls of the complex on Sunday. The full extent of the damage is not yet known.
A few hours from now and President Barack Obama will arrive in Alaska as part of his crusade to tackle climate change. The President believes if
nothing's done, temperatures in Alaska are projected to rise between 6 and 12 degrees by the end of this century.
Now bear in mind scientists say 2 degrees Celsius is the tipping point for global climate change. Our senior White House correspondent Jim Acosta
is already in Anchorage and joins me now.
[16:35:00] Besides the optics of going to Alaska, going up to the Arctic, first sitting president to be in that - to go that far north, --
what does the President hope to achieve?
JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, Richard, President Obama is on his way to Alaska right now to deliver what the White
House believes to be an urgent message on climate change. Secretary of State John Kerry, he was at this conference of Arctic Nations earlier today
previewing that message in his remarks here in Anchorage.
He was echoing what many Alaskans are already seeing here and what the White House will be talking about all week long - that the glaciers are
melting, the state is experiencing record high temperatures. They've had one of their worst wildfire seasons in years, scorching some five million
acres of land - that's roughly the same size of Massachusetts. And so we sat down with Secretary Kerry ahead of this conference and asked him about
some of the Republic opposition of the President's climate agenda.
You know, one of the purposes of this trip, Richard, is for the President to have the rest of the world see what he's seeing through his
eyes. But unfortunately Republicans just don't see the same problem - Donald Trump, Ted Cruz, other Republicans like that - they don't really
acknowledge that climate change is happening.
I asked Secretary Kerry about that and here's what he had to say.
(BEGIN VIDEOCLIP)
ACOSTA: How do you take on an issue when the other side doesn't agree --
JOHN KERRY, U.S. SECRETARY OF STATE: Well that's one of the reasons -
ACOSTA: -- it's even happening.
KERRY: -- that's one of the reasons that we're in Alaska, because it's pretty hard. Ask any Alaskan. I think people in Alaska will tell
Donald Trump and tell Ted Cruz it's happening.
And all they have come - to do is come - here and open their minds and their eyes and their ears - listen, look, and they will see the impacts of
what is happening.
(END VIDEOCLIP)
ACOSTA: Now the President will be seeing some of these effects of climate change firsthand as you said, Richard, during this trip here. He
plans to tour one of the melting glaciers by land and by sea. And later on this week he'll travel to Northern Alaska and become the first sitting
president to visit the Arctic.
He'll hear from fishermen who see their livelihoods threatened by climate change. Richard, they really see Alaska as the canary in the
climate coal mine -- as Alaska goes so potentially might go the rest of the world. And so that's why this message is urgently being delivered by this
president all week long.
QUEST: And of course the whole question of pipelines, exploration, the granting recently to BP of permissions. It all - the President finds
himself to some extent in a difficult position because on the one hand he has this agenda - this climate change agenda. But at the same time, there
are many - and many Democrats as well, as you know, Jim, -- who do believe there's an imperative for exploration and for cheaper fuel.
ACOSTA: That's right. And to some extent, Richard, the President is trying to have it both ways. Environmentalists have accused him of climate
hypocrisy. Just recently the administration approved that application by Shell Oil to do drilling for oil and gas in the Arctic.
And so the President is responding to that. He said in his weekly address that, you know, while the U.S. and the rest of the world, you know,
strives to find alternative fuel sources that are more sustainable, in the meantime they're going to have to use - we're all going to have to use oil
and gas and that means that drilling will have to take place.
I asked Secretary Kerry about that and he said you have to keep in mind in their belief Shell will have to abide by what they consider to be
some of the most stringent requirements that can possibly be used up in this drilling expedition in the Arctic and the administration is saying
they'd learned their lesson from the BP oil spill that that's not going to happen again.
Of course we'll have to watch and see if that indeed is what pans out.
QUEST: Jim Acosta, thank you, sir. Jim Acosta joining us from -
ACOSTA: You bet.
QUEST: Anchorage. Now the Arctic itself is a potential energy goldmine. According to the U.S. Geological Survey it may be home to nearly
a quarter of the earth's undiscovered recoverable petroleum resources. Thirteen percent of undiscovered oil, 20 percent of undiscovered liquefied
natural gas.
The Survey says most of the resources are likely to be offshore and it didn't include less conventional energy shores -- stores -- like oil shale
and tar sands.
Kara Moriarty's the chief executive of Alaska's Oil and Gas Association and joins me now from Anchorage via Skype.
When you hear what Jim Acosta was just saying there - I mean, obviously on the one hand, you are promoting an industry that's important
to Alaska, but you've got a president who's coming there with some very strong conservation views that could hinder your members.
KARA MORIARTY, CEO, ALASKA OIL AND GAS ASSOCIATION: Well, thank you for the opportunity and just like your reporter said, the President did
acknowledge that we still rely on oil and gas, fossil fuels for our energy needs. The whole globe does.
So as long as there is a world demand for fossil fuel, then our forecasts show that that's going to be the case for the next several
decades, why wouldn't America want it to come from our state of Alaska and across the nation in other countries like Canada who do it right?
[16:40:10] And we do abide by the safetest (ph), strictest environmental -
QUEST: Right, but well -
MORIARTY: -- standards. We're proud of that.
QUEST: Right, but you're the - you know, look, -- you know the arguments better than myself particularly when it comes to pipeline - the
latest pipeline - which of course has yet to receive approval or indeed further offshore drilling - limited offshore drilling - has been agreed
upon so f ar.
The fundamental fear is this is pristine. We can neither afford another Valdez nor another Gulf of Mexico.
MORIARTY: Well I think I would argue that we have been responsibly developing oil and gas resources for decades here. And in fact, Alaska
achieved statehood because of our oil and gas resources, because of our fishing resources.
And I think the other thing that I want Americans to be - to remember - is that 70 percent of Alaskans support this offshore development,
including most of those that live in the Arctic. The Arctic is very pristine and we do want to take care of it.
But the fact of the matter is, we have a cash economy -
QUEST: Right.
MORIARTY: -- and the people of the North Slope - the Inupiat people - they need to have good stable jobs, good stable reliable source of energy
to balance their subsistence lifestyle.
They want to have their traditional foods and lifestyle but yet they still want to have brand new Nikes for their kids just like I do in
Anchorage.
So there has to be a balance and we think we've achieved it (AUDIO GAP). And the other thing -
QUEST: Right, I -
MORIARTY: -- and this is not the first -
QUEST: -- why do forgive me. Whilst you're achieving your balance, unfortunately your Skype line is not. You're dropping out. So do forgive
me if I say thank you for joining us. We'll talk about this again maybe while the President is still visiting.
MORIARTY: OK.
QUEST: Thank you so much for joining us.
MORIARTY: Thank you.
QUEST: Now look, here's a thought for you. Ashley Madison manages to lose all the data from all the people who signed up. It was hacked, it's
been online, credit card details have been released. So you may well be asking why would anybody still sign up for Ashley Madison? Apparently
they still are, or so the company says. "Quest Means Business" - we'll talk right after the break.
(COMMERCIAL BREAK)
QUEST: "Quest Means Business," start of a new week. Ashley Madison wants cheaters to get back to business as usual on its dating site for
having affairs.
The company says nearly 90,000 women signed up last week. The hack that revealed the identities of 32 million users also revealed that - claim
that - women hardly use the site. Laurie Segal joins me now.
[16:45:04] Are you surprised that anyone, let alone 90,000 women, would be signing up for the site?
LAURIE SEGALL, TECHNOLOGY CORRESPONDENT FOR CNNMONEY: I want to see some evidence of this. I'm very, very surprised. I mean, 90,000 women.
And first, you know, I think they're trying to fight two things, right? They're fighting this argument that the company is going downhill after
this. They're trying to say, actually we're doing just fine - business is good.
They're also fighting the argument there have been a lot of reports that have come out and said, 'Hey, it's only men on here - 95 percent men.
So now they're kind of coming backing saying 90,000 women, they said - women sent 2.8 million messages in the last week.
QUEST: Why - I mean, they actually, not why are they doing it, I mean - has the company said how it's going to protect data in the future?
SEGALL: The company has been saying a lot, but what they haven't said is how they're going to protect data in the future. They have spoken quite
a bit about how business is good, they've talked about their CEO stepping down, how this is a crime.
But what we're really not hearing from the company is this is exactly what we're doing in order to secure your data and we are a site that
promises to be 100 percent discreet and we are going to make good on that promise even after all this.
We haven't heard that yet.
QUEST: The phrase - why does the phrase locking the door - the stable door - after the horse has bolted come to my mind when I think of that?
Let's talk on the very tragic and serious side of the consequences of this criminal activity - for that's what it was - criminal activity.
SEGALL: You know, I don't - I think that sometimes people have a little bit of trouble looking at it and say, well these people are victims.
These people are victims of a hack, and not only are these people victims, but their families are victims.
In the community we know that there have been multiple suicides. We know that the Toronto police have come out and said that they are
investigating a link between this. We know that these people that committed suicide were on the list - we've independently confirmed that.
We also know that you look at something like the Southern Baptist Church Convention here in the United States - they are actively looking at
this list and calling for any pastor or priest on here to resign. There are meetings all around the United States right now of religious leaders
talking about how people if they're on this list should resign.
And not only should they, but they're going to go after them if they are.
QUEST: Hardly the spirit of religion. But there we are. That's up to them. So what happens next with the claims against Ashley Madison?
Because the company is still going, the CEO's gone, they said that they've improved - or not - haven't said they've improved, we've got a witch hunt
going the vast length and breadth of the world of people searching from wronged spouses.
SEGALL: You know, what happens next is that, you know, (AUDIO GAP) they try to get back to business as usual, but I think this is going to be
really, really difficult. I mean, from what they're saying - their news today is that hey, we're actually doing well, this publicity wasn't even
that bad for us because we have people signing up.
So I think long term we'll see if people do sign up. We'll see.
QUEST: And you'll be here to tell us about it?
SEGALL: I will.
QUEST: (Inaudible). A young billionaire says his wealth has left him lonely and (ph)fulfilled. My guest says money can buy happiness if you
spend it on the right things. Before any of that, you need to make, create, innovate.
(COMMERCIAL BREAK)
QUEST: Markus Persson has the billionaire blues. You better get the Kleenex out ready for this story. He's the developer of the video game
"Minecraft" which he sold to Microsoft last year for $2 1/2 billion. Yes, the man is worth billions.
[16:50:11] Now he says he's just plain miserable. Over the weekend, Persson unleashed a series of tweets lamenting his newfound life of luxury.
So he says, "The problem with getting everything is you run out of reasons to keep trying. And human interaction becomes impossible due to
imbalance." How about this one - "Hanging out in Ibitha with a bunch of friends and partying with famous people, able to do whatever I want and
I've never felt more isolated."
A tale of woe it is indeed to be a billionaire in today's world. Warren Buffett has written, "A vast collection of possessions ends up
possessing its owner. The asset I most value aside from health is interesting, diverse and longstanding friends."
Bill and Melinda Gates have said, "We have been blessed with good fortune beyond our wildest expectations and we are profoundly grateful.
But just as these gifts are great, so we feel a great responsibility to use them as well."
Benjamin Franklin. Ah, dear Ben Franklin once wrote, "Money never made a man happy. There is nothing in its nature to produce happiness."
Though let's remember he was the iconic face of the $100-dollar bill. Michael Norton is the Harold M. Brierley professor at the Harvard Business
School and co-author of "Happy Money - the Science of Happier Spending." He's with me now from Cambridge, Mass.
On the one hand, sir, we all - we sort of say poor Persson, he hasn't got any money - he's got all that money and he's not happy. But we sort of
know what he means. That money can't buy happiness. What does he do?
MICHAEL NORTON, COAUTHOR, "HAPPY MONEY": You know, I think if you think about it even in your own life when you had less money or more money,
it matters a little bit how happy you are with your life, but money in and of itself just doesn't really solve that many problems for us because, as
he said, what matters is having friends and family who love us, spending time on the things we care about.
A billion dollars seems like you'd be able to do all of that but sometimes it can even get in the way of some of the things that really,
truly make us happy.
QUEST: Right. But as a friend once said to me, money doesn't buy happiness but it does buy a very pleasant sort of misery. I mean, you
know, with that in mind, what would you advise him to do. Because he - what he also said was he found the online rant therapeutically satisfying.
NORTON: One of the things that if you look at surveys of lottery winners for example, one of the things they described is they feel like
they're a walking dollar sign. They literally feel that every person they've ever met somehow finds an excuse to e-mail them or call them and
basically ask for money, and they also find that everyone in their family also calls them up - their aunts and uncles and nieces and nephews all call
them up as well asking for money.
It's all about money. You end up not being a person anymore with close relationships. You end up in a sense being like a bank where people
are trying to withdraw from you.
And you can imagine if you kind of simulate that feeling in your mind, it would really make you feel actually isolated. Yes, it would be a great
kind of misery to have a billion dollars, but if you have no one to enjoy it with, would you really be happy?
QUEST: All right, so, now let's get on to the therapist's chair here, sir. What's the answer because Warren Buffett gave away all his money, Bill
and Melinda Gates have done true work giving away all their money and in doing so have become world-class experts on philanthropy and the causes.
So what's your advice to Mr. Persson?
NORTON: It is in fact the case that when we spend money on ourselves, it just doesn't make us happier at all - whether it's buying ourselves a
new Apple product or buying ourselves a huge mansion. The data show that when we buy things for our self, it just doesn't pay off in more happiness.
It doesn't make us unhappy to have a great house, it just doesn't make us happier.
And the thing that really seems to make us happy with our money is in fact giving it away. We've done lots of experiments and research over the
last decade that really shows that when we give to others - it could be buying a gift for a friend, could be giving to charity as some of these
billionaires have done - that that money seems to pay off in more happiness.
Giving is a better source of wellbeing than keeping for ourselves.
QUEST: And with that in mind, I mean, again - perspective biblical analogies - "it is better to give than to receive" and so on. So you're
basically saying to him give most of it away or at least find something useful to do.
NORTON: That's exactly right and he'll find that people start to see him less as bank to be withdrawn from and more as a person who's trying to
do some good in the world and maybe they'll see him for who he is as opposed to just a walking dollar sign.
[16:50:03] QUEST: Thank you very much, sir for joining us. Much appreciate it. Now, certainly got your thoughts on that. @richardquest is
where I'm sure you've got some thoughts on what would you do if you'd been given to - You've sold your company for $2 1/2 billion -- $2 1/2 billion.
It'll keep you busy for a while.
We'll have a "Profitable Moment" after the break.
(COMMERCIAL BREAK)
QUEST: Tonight's very "Profitable Moment." It's a rum world upon which we live in. We started our discussion and our conversation tonight
with the appalling position of migrants who've barely got food to eat and clothes to wear trying to head to a better life in parts of the European
Union.
And we end this evening talking about Markus Persson who is bemoaning his lot in life because he's got a couple of billion dollars and he's
starting to feel isolated and he goes on a rant.
Now of course I understand - that's an unfair comparison to make, that one's problems are in the eyes of the beholder, and high-class problems and
first-world problems can be as important as they might be to the beholder and the person involved. Or so it goes.
It just seems it's a little difficult to feel too sorry for somebody who's sitting on several billion dollars and so far doesn't appear to have
made much effort to give much of it away.
Well, maybe that's for the future, but it does prove the old adage as you heard tonight - it is better than receive, it is better to help than be
helped.
And that's "Quest Means Business" for tonight. I'm Richard Quest in New York. Whatever you're up to in the hours ahead - (RINGS BELL) I do
hope it's profitable. He can always give it to me.
END
