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Quest Means Business
U.S. to Put Boots on the Ground in Syria; Markets Worldwide Having Best Month in Years; Credit Suisse Gets Pulled into FIFA Scandal. Aired 5- 6p ET
Aired October 30, 2015 - 17:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[17:00:11]
RICHARD QUEST, HOST: It's a Friday, end of the week. Halloween is upon us. And the spooky markets, well not really that spooky they were down just 92
points at the close. The loss of half a percentage point, true, come on.
Oh, yes, that's what you call a Halloween gavel on Friday the 30th of October.
Serious stuff. There's been a monumental shift in policy. The United States says it will put boots on the ground in Syria for the first time. We will
look at the implications of that.
Call it stock-tober, markets worldwide and having the best month in years.
Finally, a new meaning to financial fair play. Credit Suisse gets pulled into the FIFA scandal.
I'm Richard Quest, it's a Friday but of course I still mean business.
(MUSIC PLAYING)
QUEST: Good evening. The day's business news in just a moment. First though, a day of crucial developments on the effort to end Syria's civil
war.
(BEGIN VIDEO CLIP)
QUEST: Difficult but constructive. That's how the E.U. Foreign Minister describes talks that ended in Vienna where world powers met to discuss the
conflict in Syria. They agreed that United Nations should mediate the peace process. The U.S. Secretary of State, John Kerry says differences remain
over what role Syrian President Bashar al Assad may play in it.
Sergey Lavrov, and President Zarif and I and others agree to disagree. The United States' position is there is no way that President Assad can unite
and govern Syria. And we believe that Syrians deserve a different choice and our goal is to
work with Syrians from many factions to develop that choice.
QUEST: It all came on the same day as the U.S. announced its sending troops to Syria for the first time.
The White House says fewer than 50 members of special forces will advise and assist rebels in the fight against ISIS.
CNN's senior international correspondent Nick Paton Walsh joins me and Nick is in southern Turkey for us tonight
(END VIDEO CLIP)
QUEST: Nick, we're going to take this bit by bit because I need you to parse the details. Let's start first of all with the boots on the ground.
50 special forces, now they are going to help against rebels against ISIS, not in the battle against Assad, is that correct?
NICK PATON WALSH, SENIOR INTERNATIONAL CORRESPONDENT: Yes. But it turns out that some of the Syrian rebels they may end assisting may also have an
agenda. That does involve at some point fighting the regime. But we know they are headed to an area which is predominantly controlled by the Kurds.
Now the Kurds are just the south of where I'm standing all along the northern Syrian border with Turkey. They've regularly been fighting ISIS.
(BEGIN VIDEO CLIP)
WALSH: Remember the fight for Kobani, ISIS pushed out of that town. Now we may find some of this activity congregates there. There is also with the
Kurds a large number of Syrian motor rebels called the Syrian Arab Coalition. Now frankly, they are not a big player in the war inside Syria.
They are moderate. They've been in the mix for the Syrian Kurds quite a lot particularly in the fight for Kobani. These seem to be the ones that the
U.S. special forces are directing their efforts towards. They will give them weapons, advising them, giving them air strike support potential too.
But quite when this comes into effect and how effective it is a bit far off, Richard.
QUEST: And can I hear in the U.S. and indeed I can hear critics generally saying you know, shades of Vietnam, this is how it began.
(END VIDEO CLIP)
QUEST: It starts with special forces, then becomes military advisors and before long you've got a brigade on the way.
WALSH: This feels Richard more like reaction to the Russian escalation in all honesty.
(BEGIN VIDEO CLIP)
WALSH: I mean the timing also significant, slap in the middle of these peace talks in Vienna. I think this is Washington telling Russians you're
telling us not to send troops to Syria, you're telling us you want to see territorial integrity of Syria, well frankly this is our response we're
continuing with our campaign against ISIS.
(END VIDEO CLIP)
WALSH: It's not a seismic change in the war there and I do think the White House frankly as any western government should be very mindful of getting
drawn into this (inaudible). They've seen the Russians do it, they're weary of not making the same mistake. This is small, frankly Richard, much of
this could already be happening. We don't know everything the forces do the whole time. They are saying about two dozen are going in first. This may be
a public acknowledgment of something that's happening and maybe it's going to happen now on a slightly larger scale, Richard.
[17:05:19]
QUEST: I just want to talk about the Vienna conference. It looks bizarre, frankly. You've got this massive table with them all sitting around trying
to decide how to end the civil war in Syria whilst at the same time whether Assad stays or goes when some of the people at the table believe he should
stay.
I mean, and of course, you know, what are they going to do about it anyway.
WALSH: Well if you bear in mind the one person who was not invited and that was any single Syrian. That's a table full of all of the people who are
sponsoring the proxies inside Syria in this war but in Syrian opposition, no Syrian rebel fighter and no Syrian regime member there.
Park that to one side. What do they come up with? Well you could say a refreshing fact they can agree on some things. They want Syria to be united
as a country. To be secular going forward. (END VIDEO CLIP)
WALSH: Syrian state institutions are (inaudible), they don't agree on Assad, they never would do, but they've come up with a plan and that plan,
frankly, is a lot wishful thinking. But it's at left a plan and it's a plan that everyone has signed on to.
It's for elections at some distant point in the future. Very hard to even imagine how those will work. Because they want refugees to get the vote and
they're scattered all over Europe if not the world at this stage. And they also want to see cease fires. Well that's extraordinarily complex too.
Because those cease fires can't involve anybody who's a terrorist and nobody can agree at that table who is a terrorist anyway apart from ISIS
which pretty much everyone dislikes there.
So a phenomenally complex scheme they have come up with but I think really what John Kerry was doing by trying to marshal this process was to say
right, well at least we actually agree on something's. We're all pretty tired of this war, we're all very worried about what it is doing to Europe
and to extremism in the Middle East, and the fact that it doesn't seem to have a way to end at this point. Maybe there's a starting element here.
Unfortunately, though, every time you put forward a bunch of things people might be willing to agree upon, it falls apart at first inspection. Because
everybody at the table has such a polarized different set of agendas, Richard?
QUEST: Nick, thank you. Blunt and to the point and maybe a little depressing in the outlook but certainly we appreciate it this evening. Nick
Paton Walsh in southern Turkey for us this evening.
Maybe a little bit more optimistic. Stocks across the planet have dealt with traditionally scary month with real panache. Trading in October, the
month that always gives us the willies has come to an end and even as Halloween approaches, there's no sign of the October effect.
Have a look at these numbers, just look.
(BEGIN VIDEO CLIP)
QUEST: Forget today, that's the Dow today, it was down 92 points. Even today was a bit of a bit of an ump and armor day, a bit up there, down and
then a bit round and round but we are off just a half percent. But never mind that because worldwide indices have finished with their best month in
at least four years.
Markets are boosted by central banks. No hike from the Fed. The ECB gave more than a hint they almost put up a white flag and said more QE is on the
way. And China cut interest rates. Now if you get that heavy brew into your cauldron, this is the sort of noxious potion that it comes up.
The Dow Jones up 8.4% in October. The best in four years. The FTSE up 4, nearly 5%. The Nikkei up 10%. The Xetra Dax in Germany being beaten left,
right and to the center up 121 /3%.
(END VIDEO CLIP)
The largest bank in France has reported strong earnings. BNP Paribas saw profits climb some 15% in the last quarter. Let's talk about it with the
head of North America, good to see you, sir. Joining me is Jean-Yves Fillion, the CEO.
JEAN-YVES FILLION, CEO, BNP PARIBAS: Very nice to see you Richard, thank you for having me.
QUEST: So we'll come to your numbers in just a moment. Those market numbers in October, when we thought there was going to be a disaster in a bear
market in the summer, it never happened. What was - what turned the sentiment, do you think?
FILLION: Well it never did. It shows how much activity and uncertainty, by the way, we face in this complex environment.
(BEGIN VIDEO CLIP)
FILLION: However I think it's really driven by the strength of this economy. It's driven by the strength of the corporate fabric in the United
States, and as you said the month of October is one of the best months ever of the last four years.
(END VIDEO CLIP)
QUEST: The U.S., which is your area of expertise; the U.S., it's not the only engine. China is now the second largest in the world. But the U.S. is
the main engine that is still driving this growth.
[17:10:00]
FILLION: It is still. If you look at the GDP growth, even though slightly slower in the last quarter. But if you look at some of the key sectors,
auto, housing, and you know, spending time on my life with day-to-day, with you know, CEOs in this country, the corporate world (inaudible) creative,
very global, which I believe has highly benefited this country.
QUEST: So, without sounding too sort of meristic or jingoistic -- the U.S. has a right to certain extent to say to the rest of the world, hang on, we
all went into this crisis. But look how we've all come out of it. Europe, 1%, 1.5%, growth and you've still got unemployment in the 10%. U.S. fast
growth, low employment. The U.S. has a certain claim to say they got it right.
FILLION: I think does. However, what you just said, we should highlight how connected the world is. And the U.S. is benefiting from the strong
foundations. But if I may, on the European side, as you said the Eurozone is going this year. Which was not the case before, and I've seen a
significant number of (inaudible) from there including the ECB, developing this QE, which by the way what the Fed has done very successfully here,
which is providing a better momentum in Europe as well.
QUEST: We'd talked on this program this week about Barclay's Bank with their new Chief Exec. We talked about yesterday Deutsche Bank. And now I'm
not asking you to comment, per se, on those banks. But are guests constantly said that there is this shift from the European banks away from
investment bankings, M&A, debt issuance, and all of that. Is that what you're seeing from the European Banks.
FILLION: It is very regulatory driven. And by the way, it's normally in the U.S. The regulators are now asking for good reasons, by the way, to make
(inaudible) safer and sounder for more capital, for more liquidity. And this is what you are seeing happening here. You see these banks basically
just adjusting and adapting as it relates to BNB Paribas in the United States. We've actually developed a very diversified business model between
retail and wholesale well capitalized liquid, This is what retail brings you and being very specific in terms of which clients we wanted to target.
You have to be targeted here. If you want to be successful.
QUEST: Right. But this shift away from investment -- or not shift way, this nuance change in investment banking. Does it mean that the European banks
are effectively saying, we can't compete globally in investment banking against the big U.S. The JP Morgan Chases. Morgan Stanleys, Bank of
America, Goldman Sachs.
FILLION: I would say to be successful in the United States, which is really owned as you said by the large U.S. Banks and very efficiently, you have to
provide a complimentary offer to what this bank provides here.
Our client base at BNP Paribas is mainly based on global U.S. Corporates, which by the way, we take to the European market when the they need to
raise capital there and conversely we've been very systematic in taking European corporates into the deep U.S. Investor base here.
And the business model that works here is a business model that will remain balanced, that will remain universal, and that will provide diversified
solutions, whether straight finance, whether it's pure investment banking, whether it is retail. Because at the end of the day, it is the only way --
QUEST: But it has to be balanced.
FILLION: It has to be balanced, but this is a universal model that banks have developed successfully and this one who's managed to be resilient and
sustainable.
QUEST: Good to see you, sir.
FILLION: Thank you, Richard.
QUEST: Credit Suisse, has become the first global bank to admit that it is facing scrutiny in relation to alleged corruption and money laundering at
FIFA.
Our justice correspondent, Evan Perez is in Washington for us tonight.
Now look, they're not saying that Credit Suisse - I mean they're not a target yet, and they're not suggesting as far as the best I can tell, that
Credit Suisse had their finger in the till. But they are suggesting that they were the conduit through which much of this money may have passed
through the banking system. Have I got that just about right?
EVAN PEREZ, CNN JUSTICE CORRESPONDENT: That's exactly right, Richard. This is a case of where we knew, we expected that this scandal would grow to.
Which is we know that U.S. has alleged that about $150 million in bribes over the years have been paid by different parts of the world into FIFA for
various parts of the scandal.
(BEGIN VIDEO CLIP)
PEREZ: Including fixing elections and trying it make sure they can buy different places to host the world cup. What has happened now is that
Credit Suisse has acknowledged for the first time that they are now getting inquiries about their relationships with different figures in this FIFA
scandal. We're talking about everyone from Sepp Blatter, the President, the longtime President of FIFA who is now under investigation -- criminal
investigation for this scandal. As well as some of the other executives who were arrested by Swiss authorities under a U.S. warrant back in May when
the scandal first broke.
(END VIDEO CLIP)
[17:15:07]
PEREZ: Now, it's true that Credit Suisse is the first to actually acknowledge this but we know that many other banks have gotten inquiries
from financial authorities both in the U.S., the U.K., and Switzerland. We know Barclays, Deutsche Bank, and HSBC have all fielded these inquiries
from prosecutors and investigators who want to know about the money, the trail of the money, Richard.
QUEST: Evan Perez, joining us from Washington. Keep a watch on this one this has got legs.
PEREZ: Absolutely.
QUEST: When we come back after the break, Valeant and Phillidor, two names you may not be too familiar with, but my word, what a goings on there were
in the market with both of them today.
(BEGIN VIDEO CLIP)
QUEST: We'll have that story after the break. "Quest Means Business" on a Friday.
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(END VIDEO CLIP)
(COMMERCIAL BREAK)
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QUEST: Valeant Pharmaceuticals is now in a full blown crisis. It's been accused of generating phantom sales to a pharmacy called Phillidor.
Now Phillidor shut down operations and Valeant has cut the ties. It's allegedly pressured doctors to use the pharmacy for prescriptions. It all
made it harder for providers to use any other company's drugs.
So you want to see what the effect is.
(BEGIN VIDEO CLIP)
QUEST: Valeant shares, they fell a further 15% on Friday. And the controversy has plagued the company since back in August. So the price of
the stock is cut in half over the last three months.
I asked CNN Money's Paul La Monica to explain, help me understand the Valeant mess.
(END VIDEO CLIP)
PAUL LA MONICA, CNN MONEY DIGITAL CORRESPONDENT: There are a couple of things. Valeant got dragged into the controversy about pharmaceutical
companies and bio-techs that have been aggressively raising drug prices. That is one thing that that has hurt Valeant because they have been
criticized for that. But the bigger issue is that there is an influential research firm that focus on short selling called Citron. They put out a
report not that long ago saying that essentially they felt Valeant was the Enron of Pharma. That there were accounting issues particularly with this
pharmacy they do business with called Phillidor, shady things and that led the stock to plunge dramatically. And they still have I think this
credibility problem.
QUEST: So Phillidor has now gone.
LA MONICA: Yes.
QUEST: And Valeant has to convince the market that it is a bona fide operation or at least didn't have something nasty, some skeletons lurking
in the closet.
LA MONICA: Exactly. And it doesn't look like the company is doing a good enough job yet. Not even its biggest shareholder, Bill Ackman, huge hedge
fund investors who is long Valeant had a nearly four-hour conference call on Friday to defend the company.
He still thinks it's a good value. He thinks some of the accusations about accounting fraud are overdone, but the stock continued to plunge. And
Citron ominously warned there is going to be another report coming Monday with even more dirt on this company. So we're going to watch and see how
bad things get on Monday as well.
[17:20:07]
QUEST: So how bad is the situation for Valeant? Because it is a legitimate pharmaceutical company. For instance it bought same day or virtually, the
day after the female Viagra, the female libido drug was received FDA approval, Valeant bought it for over $1 billion. So it is a company with
revenues.
LA MONICA: Yes, Valeant has legitimate drugs, they also bought some eye care products from Bausch and Lomb a few years ago. I think one of the
concerns is that it's a company that has grown primarily through acquisition unlike some of the other large pharma companies, and people are
just wondering. Anytime you have a company that grows by acquisition, we all remember Tyco accounting can be a concern.
QUEST: Finally the market I was reading on cnnmoney.com best third quarter.
LA MONICA: Best October.
QUEST: Best October - best October.
LA MONICA: Yes, actually the best month in four years following what was the worst third quarter also in four years. So we really are having almost
a mirror image of 2011. Everyone panicked when we had a debt drama and S&P downgraded the credit rating in the United States. Then after that, the
stock market went on, had a huge October. Rallied for the end of that year and the bull market continued. So far we seem to have that pattern
repeating itself.
QUEST: I was about to say. Does lightning strike twice?
LA MONICA: One can hope unless you are short stocks like Bill Ackman usually is. Bring it back to him. He's short Herbalife remember so a lot of
people are poking fun at his expense. 'Cause he's gotten Herbalife wrong as well as Valeant.
And also if he thinks Herbalife is a pyramid scheme, what is he doing with a company that might be doing accounting fraud? So just food for thought.
QUEST: Might be doing. Let's make sure we're clear. Might be doing. When we come back, after the break; Indonesia, the haze that is now over that part
of the world.
(BEGIN VIDEO CLIP)
QUEST: And the damage to health, the worries for the economy and all because of illegal logging. And burning. We'll tell you that part of the
story after the break. Quest Means Business.
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(END VIDEO CLIP)
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
QUEST: A crime against humanity is how climate experts in Indonesia are describing the haze from the smoke from the wildfires that's blanketing the
country.
(BEGIN VIDEO CLIP)
QUEST: Just look at the depiction of those wildfires in Indonesia. And not only - I mean these are the various fires but just look at the haze range.
All the way up north to the Philippines. Across to Vietnam, Thailand and right the way out towards the east. They are illegal wildfires and they are
set to clear the land for the production of pulp, paper and palm oil. Green peace is accusing Asia Pulp and Paper Company of being the main culprit.
Well David Molko now has this dispatch from Indonesia.
DAVID MOLKO, CNN CORRESPONDENT: It's early morning at this command post. Fire fighters, military and disaster officials talking through their
strategy for the day ahead. A bitter smell hangs in the air. There are new hot spots, they're told. A daily occurrence in this city at the center of
Indonesia's haze crisis.
So even though there was a heavy downpour here overnight, what they are saying is there appear to be reports of a fire in the direction of the
airport. We are going to follow the team that's headed that way and see what we can find.
A convoy speeds through the streets, carrying a team of a dozen men. Many of them volunteers. 15 minutes later, we arrive. Smoke rising from the
charred landscape. The team wastes no time, unleashing a frothy mix of water and chemicals, getting as close as they can to the source.
I have to tell you this isn't exactly what I expected. When they say hot spot, it doesn't necessarily mean you see flames above ground. What happens
is the soil smolders. This has actually peaked. This is what they have been talking about, the carbon rich soil that sends so many many greenhouse
gasses into the air when it burns. It is extremely dry and it almost becomes like a tinder box when it ignites. And the trick with firefighting
here is they have to spray it and spray it and spray it because even if it appears there's no flames at the surface, it could still be burning below
ground.
UNIDENTIFIED MALE: (As translated): We are helping the people here. We are very proud. This is the first time we are trying to put out fires on peak
land.
MOLKO: It's challenging work (inaudible) says. But he believes everyone needs to do their part.
UNIDENTIFIED MALE: (As translated) All people have to be united so the fires and smoke won't happen again.
MOLKO: And that's a sentiment echoed by use of (inaudible). A local official who leads ground operations.
I really hope that people understand, he says that you can't clear land by setting fires recklessly. Teams say these conditions are the worse they've
seen since 1997. But now they say they have better tools and the training to fight back.
90 minutes later their work here is done. One hot spot extinguished, they say and countless more to go.
David Molko, CNN, (inaudible) Indonesia.
(END VIDEO CLIP)
QUEST: The International Monetary Fund is thinking about changing the rules. Well it may have to change the rules if it's going to offer Ukraine
a lifetime. I'm going to explain to you the complicated rules of a loan from Russia.
(BEGIN VIDEO CLIP)
QUEST: And how that's given the Ukrainian Finance Minister pause for thought. It's all next, you'll hear from her in a moment.
(MUSIC PLAYING
(END VIDEO CLIP)
[17:31:18] QUEST: Hello, I'm Richard Quest. There's more "Quest Means Business" in just a moment when the head of IATA the airline association
tells us why Chinese consumers will keep buying plane tickets.
And it's the GOP versus NBC. The Republican Party launches a boycott over last Wednesday's debate.
But before all of that, this is CNN and on this network the news always comes first.
Talks aiming to end the civil war in Syria have ended without an agreement on what role the Assad regime will play in the country's future.
World leaders in Vienna have agreed to meet again in two weeks to continue talks. The U.S. Secretary of State John Kerry says he's agreed to disagree
with Russia and Iran on whether Syrian President Bashar al-Assad can remain in power.
The U.S. is sending its first ground troops to Syria to advise and assist rebel troops in fighting ISIS. The White House says fewer than 50 special
operations forces will be deployed to the northern part of the country.
They'll help Arab and Kurdish groups with logistics and planning.
Twenty-two migrants died on Friday in separate shipwrecks in the Aegean Sea. The Greek coast guard says 144 people have been rescued, three are
still missing.
The Greek prime minister has roundly criticized Europe's response to the crisis.
The last British resident held at Guantanamo Bay is back on British soil. Shaker Aamer arrived outside London today, released by the United States
after 13 years in custody at the U.S. prison.
The Saudi national had been accused of aiding Osama bin Laden. He was never charged.
The French Foreign Minister Laurent Fabius is facing calls to resign after his son was charged with passing bad checks to casinos in Las Vegas.
Thomas Fabius is accused of using bad checks worth more than $3 million in various casinos.
The French national prince (ph) says the charges compromise the foreign minister's relationship with the United States.
Live pictures from Washington. President Obama and the First Lady Michelle Obama are welcoming trick or treaters to the White House for Halloween.
The children in costume are getting chocolate embossed with the presidential sea. And as you can see there - I have no idea what's causing
those people to be hanging around there.
Oh, there we are. There's the president, there's the first lady, there's the ghouls, there's the children, there's the chocolate, and that's all you
need.
The International Monetary Fund is considering changing its rules on lending money in order to help Ukraine with its latest bailout. At the
moment the IMF is not allowed to provide financial support to a country that is in debt arrears, in default that has failed to pay a debt owed to
another country.
Now Ukraine says it won't repay $3 billions of dollars to Russia that's due in December on a Euro bond that would appear to put Ukraine in arrears,
making it unable to receive the multi-billion dollar IMF bailout.
The Fund has called on Ukraine and Russia to reach an agreement over the payment.
(BEGIN VIDEOCLIP)
GERRY RICE, DIRECTOR OF COMMUNICATIONS, IMF: The IMF encourages both sides to engage in constructive discussions on the restructuring of this bond, to
provide the necessary financing for the program being supported by the IMF in Ukraine and to help restore debt sustainability.
[17:35:14] QUEST: Now the Russians have refused to negotiate and won't talk to the Ukrainians at least about joining in the restructuring of the
bond. Now the Ukrainian finance minister says she's open to dialogue with Russia on the whole issue.
I asked her if the IMF doesn't change the rules, can it still help Ukraine in time.
(BEGIN VIDEOCLIP)
NATALIE JARESKO, UKRAINIAN FINANCE MINISTER: Well I do understand that they've called a board meeting for some time in late November, so with
regard to the change in policy, the change in policy's not about Ukraine specifically or about the so-called Russia bond.
It's in fact about the entire policy at the IMF. So I understand that it's something they've been trying to do for quite some time and they've been
working on it long before this issue became so real.
QUEST: If the bond, if the deal with the IMF falls through in terms of at least in the immediate future because of this, how serious will that be for
Ukraine if you do not get this assistance from the IMF?
JARESKO: Well clearly, I mean, being in the IMF program is the number one priority and it has been since, frankly speaking, April of 2014 when we
started in a standby program and then we renegotiated and entered into an extended fund facility in March of this year.
For us, remaining in the IMF program is critical financially, it covers a large part of the $40 billion debt that was identified in our balance of
payments. But it's also a precondition for all of the other bilateral and multilateral lending that supports us, whether it's the United States, the
European Union or others.
And then finally, frankly speaking, it's an important seal of good housekeeping, a seal of quality for our foreign investors who may not be
fully aware of the things that we're doing in the country and aren't keeping up with us on a day-to-day basis.
But when they know that we're complying to the IMF program, it gives them confidence to return and to make new investments here.
QUEST: So do you think Russia is just - pardon me the language - is just being bloody minded to be obstructionists to make life as difficult as
possible for Ukraine.
JARESKO: That's a question not for me. I will say that in terms of the Ukrainian government, we have continued in good faith to offer them the
same types of commercial terms to avoid trying to politicize this.
At this stage they've made a choice not to participate in the restructuring, but of course I will continue my dialogue which began just
some time again in a meeting in Lima, Peru with the finance minister of Russia and the finance minister of Germany.
I've offered to meet with them again if that's of any value and continue the dialogue.
QUEST: So you are prepared tonight to tell us that you'll have more negotiations with Russia if you believe that that would assist or at least
unlock this key? Because clearly the obvious answer is to unlock this key.
JARESKO: Well for us, you know, again, it's very important for us to continuously be operating in good faith and it's very important for us to
keep a dialogue open.
I wouldn't call them negotiations at this point, but I am absolutely happy to continue the dialogue and try and find something that is within the
realm of our financial abilities, the political opportunities that we have here and ramifications of our - of the - situation.
But also as I described to you, the legal obligations that we have in this restructuring to all the other Euro bond holders.
(END VIDEOCLIP)
QUEST: Ukrainian finance minister talking to me from Kiev.
The chief executive of IATA, the International Air Transport Association, says demand for air travel in China will keep growing despite an economic
slowdown.
Tony Tyler told John Defterios even as China is set to overtake the U.S. as the world's biggest market for flying.
(BEGIN VIDEOCLIP)
TONY TYLER, CEO, INTERNATIONAL AIR TRANSPORT ASSOCIATION: I think sealing double-digit growth sustaining for many years is become as I was mentioning
to you very difficult indeed.
But we're forecasting growth in the Middle East region of something like 4.6 percent up to 2034 which will bring the total number of passengers up
to an easy-to-remember 365 million a year.
A million passengers a day when you think about it, that's huge. So although growth may temper a little bit, there's still plenty of growth to
be had.
JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: Would you say the same for Asia then as well?
TYLER: Asia, yes Asia as well. We won't see double-digit growth, but we'll see solid growth. I mean, China - just China for example - we're
forecasting 5.2 percent growth over that period which will make the Chinese market the biggest market. It'll be overtaking the United States.
And so, again, although it won't be a completely smooth road ahead, it'll overall be one that will show plenty of growth in business.
DEFTERIOS: As you know, there's been a lot of panic about holding on to 6 1/2, 7 percent GDP growth in China. Is this filtering in to the airlines
sector or the passengers sector or is the retail sector or the consumer sector still holding up for you?
[17:40:10] TYLER: Yes, I think that the Chinese government has deliberately tried to refocus the Chinese economy onto the consumer sector,
making the engine of growth consumer spending rather than capital spending.
And of course consumers buy air tickets, and so we're not seeing Chinese air travel - the greater Chinese air travel - really reducing at all.
It's remaining still robust despite the economic difficulties that are facing the country as a whole.
(END VIDEOCLIP)
QUEST: Tony Tyler of IATA. Tony of course gives up the job next year. We're waiting to find out who will take over at the airline organization.
The RNC says it is finished with NBC. The Republicans in the hunt for the White House are crying a firm foul after they say the network took a mean-
spirited tone at Wednesday's debate.
(COMMERCIAL BREAK)
QUEST: The Republican Party in the United States is to suspend or it is suspending its ties with NBC News. The RNC says Wednesday's debate on CNBC
was conducted in their words in "bad faith."
It puts the primary debate scheduled for February in jeopardy, at least to be held by NBC.
Now on Wednesday a number of candidates complained about what they considered aggressive or inappropriate questioning.
(BEGIN VIDEOCLIP)
CHRIS CHRISTIE, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: Right. What we should do is to be investing in all types of energy, John - all types of
energy. Now I've laid out --
JOHN HARWOOD, CHIEF WASHINGTON CORRESPONDENT, CNBC: You mean government?
CHRISTIE: No, John. John, do you want me to answer or do you want to answer?
(AUDIENCE LAUGHTER)
CHRISTIE: I got to tell you the truth. Even in New Jersey what you're doing is called rude.
HARWOOD: Is this a comic book version of a presidential campaign?
DONALD TRUMP, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: No, not a comic book and it's not a very nicely asked question the way you say that.
BEN CARSON, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: If somebody put me on their homepage, they did it without my permission.
CARL QUINTANILLA, CNBC REPORTER AND ANCHOR OF "SQUAWK ON THE STREET": Does that not speak to your vetting process or judgment in any way?
(AUDIENCE BOOS)
CARSON: No, it speaks to the fact that I don't know that it's going on.
TED CRUZ, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: This is not a cage match. And you look at the questions - 'Donald Trump, are you a comic-book
villain?' 'Ben Carson, can you do math?' 'John Kasich, will you insult two people over here?' 'Marco Rubio, why don't you resign?' 'Jeb Bush, why have
your numbers fallen?' How about talking about the substantive issues people care about?
(AUDIENCE APPLAUSE)
(END VIDEOCLIP)
[17:45:05] QUEST: CNN Money's Dylan Byers joins us now from Los Angeles. Let's start - I mean - CNBC has been roundly beaten up over the
questioning.
But when you look and compare, say, to the Fox debate or the debate by our own CNN colleagues, is there really any different level of questioning?
DYLAN BYERS, CNN MONEY CORRESPONDENT: Yes, Richard, I think there was a different level of questioning.
I also think it's true that the Republicans sort of understand the convenience and the benefit they have by going after the debate moderators.
I mean if you look at the most recent clip you played of Senator Ted Cruz, he was asked a question about the debt ceiling. That's a perfectly
legitimate question. That's not a 'gotcha' question, that's not a, you know, question lacking in substance. It's a very substantive question.
But he saw that as an opportunity to win applause from the audience, to win support - you know, it's red meat to the conservative base and it also
allows these guys to basically discredit any question CNBC asked them that they don't like.
QUEST: Right, but -
BYERS: So look, --
QUEST: -- let me jump in there. But they've learned this trick from the first two debates - two or three debates, haven't they?
I mean, they've seen those first debates. They saw with Fox how you can attack the moderator afterwards like Kelly Megyn (ph), they saw with CNN's
well how you can attack.
And now they've basically discovered , as you rightly say, a potentially if not winning formula, at least favorable formula.
BYERS: Oh you're absolutely right and in fact this goes back further than just this campaign cycle. I mean, think about all the attacks that's
candidates just like Newt Gingrich were making back in 2012.
Going after the media, especially if you are a conservative Republican, is a tried and true strategy. It always works because support for the media,
faith in the media, or trust in the media is at an all-time low, especially among conservatives.
And you know, look, when we cover that, when we think about that, we have to be sensitive to the fact that that is a strategy and it's one we're
going to see play out I think for the rest of the 2016 cycle - at least in the Republican primary.
QUEST: Donald Trump has kissed and made up and fallen out and kissed and made up with Fox enough times. Is it your gut feeling that NBC and the RNC
kiss and make up?
BYERS: Yes, but we don't know. There's a lot of time between now and February when the NBC debate is supposed to take place.
There's also sort of - there are a lot of variables, right? On the one hand you have Republican campaigns meeting in Washington, DC this Sunday to
try and get more controls of the entire debate process from the RNC.
If they take it over, maybe they'll go and negotiate with NBC.
The other thing you have to remember is that by getting rid of NBC News as a partner, you're potentially getting rid of Telemundo which is an NBC
property who is supposed to co-sponsor that debate and were the only Latino Hispanic media organization in the entire Republican primary debate
calendar.
And that doesn't look good for Republicans or for the RNC if in the wake of 2012 they were saying, look we need to do a better job of reaching out to
Hispanics.
So there are a lot of things here that are probably going to force these two parties to come to the table and make something happen.
QUEST: Dylan, thank you. Scary stuff - well may be scary on Halloween. Thank you.
When we come back, it is Halloween and perhaps the most frightening thing is the amount of money that Americans spend on this somewhat artificial,
somewhat made up holiday.
We'll show you the numbers and that'll give you a nasty shock after "Make, Create, Innovate."
(COMMERCIAL BREAK)
(17:51:34] QUEST: Ah! That time of the year. It seems like it's been an age since the simpler days of Halloween. Well then you just got a ghost
from a bedsheet over the head.
But not in America. Instead, Americans will spend nearly $7 billion - yes, I said billion - dollars on the celebration this year - just down a tad.
Just forget the little sheet over the head.
Now it is all glamorous. That includes billions of dollars on costumes for trick or treating.
So pets get some $350 million - hello, Eddie -- $350 million for a pet.
And then you've got the kids like Eddie who's making his first appearance on television -- $950 million.
There's $20 million for people to dress in great costumes! It's going to be brilliant, going to be great! Says the Donald.
All for Halloween.
(SOUND OF THUNDER)
TOM FINKEL, EDITOR IN CHIEF, "VILLAGE VOICE": (Inaudible) with me.
QUEST: Good to see you. This is the more conventional, the more conservative - a belly dancer with maybe who should cover up or a doctor's
outfit.
What is it about Halloween that people in this country go wild about?
FINKEL: What is the ritual? We're a young country compared to Great Britain and I think people have a high propensity to love to have rituals.
And they also like to have fun.
QUEST: But this is extraordinary. Anybody who's ever come to this country is amazed at the American ability to suddenly just want to get involved.
I mean, the old joke - what do you say? - this country has Hallmark cards and they created it all. Give us an idea what happens here in New York
over Halloween.
FINKEL: Well, there are parades. There's a dog parade - costumed dogs, there's a people parade that's been going on for more than 40 years and
there are parties galore.
QUEST: A dog parade?
FINKEL: A dog parade, yes.
QUEST: A dog parade. Do you find it shocking when you see that $350 million will be spent on pets at Halloween?
FINKEL: Frankly, yes, I do. But I'm a cheapskate.
QUEST: You're a cheapskate?
FINKEL: Yes.
QUEST: That parade that will go up 6th Avenue - I think it was up so it's one of the only parades that goes in the opposite direction to all the
others.
(Inaudible) point. You can take Eddie off if that he needs to sort of leave.
FINKEL: You brought me in with a dog and a baby.
QUEST: Sorry?
FINKEL: You brought me in with a dog and a baby.
QUEST: Yes, (LAUGHTER) exactly.
FINKEL: Upstaged.
QUEST: Actually you can't win. None of us can. None of us can. So, where was I? Yes, the parade goes uptown as opposed to all the others
which go downtown.
It is a quintessentially New York moment, isn't it? Anything goes in this city on that Halloween parade.
FINKEL: Well, absolutely anything goes in New York City all the time. In that way with Halloween, I don't think it's really different anywhere else
in the country.
It's a holiday that Americans embrace. It started off probably with religious roots, but it's a completely secular holiday.
QUEST: What will you be dressed as?
FINKEL: You know, I almost wore my Newark Bears jersey and my Newark bears hat but I was talked out of it. So maybe that.
[17:55:04] QUEST: Tom Finkel of the "Village Voice." Thank you very much indeed --
FINKEL: Great to meet you.
QUEST: -- for joining us.
FINKEL: Thank you.
QUEST: And we will have a "Profitable Moment" after the break. Hello.
(COMMERCIAL BREAK)
QUEST: Tonight's extremely "Profitable Moment." Americans love a festival, a chance to dress up, a chance to spend money.
As I told you, $7 billion will be spent on Halloween. Now the costumes will be different. Some will be skimpy, most of them will perhaps be a
little bit may a risque there or something a bit more normal.
But there is much to be afraid of this Halloween in the economy. Oh to be sure the worst of the summer stock market ghoulies and ghosts didn't come
to fruition. But we're heading into a winter where China could still be a nasty waiting to bite us before the end of the year.
Put all this together and as the Americans celebrate Halloween this year, there will be costumes galore because they know there are problems ahead.
And yet that biggest problem, that biggest scary moment - that doesn't happen until 2016. That of course is the presidential election. There'll
be plenty of time for the ghosts of that to come out.
And that's CNN "Business Traveller" and "Quest Means Business" for tonight. I'm Richard Quest. Whatever you're up to (RINGS BELL) in the hours ahead,
I hope it's profitable.
I'll see you next week.
END
