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Quest Means Business
Rio Prepares for Olympic Opening Ceremony; Protesters Block Olympic Torch Route; Rio Clears Last-Minute Hurdles Ahead of Olympics; U.S. Economy Added 255,00 Jobs in July; Lu: Many People Aren't Feeling the Recovery; U.S. Stocks Rise on Strong Jobs Report; Trump Unveils Team of Economic Advisers; Trump Properties Losing Visitors During Campaign; New Polls Show Trump Trailing Clinton; Google Works to Put Rio's Favelas on the Map; AC Milan Sold to Chines Consortium; Amazon Take Flight with "Prime Air" Debut; How Criminals Make Money Out of ATMs; South Africa's ANC Party Facing Historic Losses. Aired 4-5p ET
Aired August 05, 2016 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:00] ZAIN ASHER, CNN ANCHOR: All right, and with that round of applause that marks the end of another trading week. The strength of the
economy was really the focus. We've got that stellar jobs report. The Dow is up by triple digits, as you can see there as the trading comes to a
close. On Friday, August the 5th.
It's the end of the road to Rio. The games kick off whether Brazil is ready or not. A strong jobs report could spell trouble for Donald Trump.
And Amazon takes vertical integration to new heights with a launches of Prime Air. I'm Zain Asher and this is QUEST MEANS BUSINESS.
Tonight after all the setbacks, cutbacks, and controversy, the curtain is about to be raised on the Rio Olympic Games. The opening ceremony begins
in just three hours and now, and organizers are promising a magical night. There you see there, the Maracana stadium. Super model Giselle, she's
going to be performing, and Dame Judi Dench will also give a reading as well. There's going to be plenty of fireworks, too, of course. At least
if the rehearsals are anything to go by, all of this on a budget that organizers say was actually 12 times smaller than London's ceremonies back
in 2012.
But there have been some last minute snags. The Olympic torch route had been moved after anti-government protesters blocked the parade on
Copacabana Beach. We have correspondents all over Rio. But first I want to go straight to our Shasta Darlington who is at the fan zone. Shasta,
there are three hours to go. Given all the headwinds that we've seen, all the troubles, what are the chances the next few weeks will go off smoothly
without a hitch?
SHASTA DARLINGTON, CNN CORRESPONDENT: I wouldn't bet on it, Zain. I don't think we're through. I don't think we're through the woods yet. The good
news is that today will actually be focusing on the spectacle, on that opening ceremony. As always there's a lot of mystery surrounding it. You
can see at the live site, this fan zone, hundreds of people are already starting to gather. There are big screens here that will be projecting it.
So, overall, those who don't have the many-hundred-dollar tickets, they can watch it right here.
And they're speculating about who will carry the torch to light the caldron. There had been high hopes it would be the king of football, the
king of soccer, Pele. He announced today that he would not be participating in the opening ceremony because of his bad health. He's had
hip problems. So now that's the big mystery, everybody wants to know who it is. They'll be glued to the big screens right here so they can find
out. But again, I don't think we're through all of the difficulties ahead, Zain. Even the latest poll shows that two-thirds of Brazilians still think
that these Olympics are going to do more harm than good here in Brazil. That's because we're in the middle of a second year of recession. Only 16
percent said that they weren't even enthusiastic about the games. There's still the chance, like with the world's cup, once the competitions begin,
once the ball starts rolling, everyone will get caught up in the enthusiasm, in the energy. But so far I wouldn't bet on it, Zain.
ASHER: Shasta, just in terms of public perception, how does the local government make sure that the games isn't sort of constantly drowned out
over the next few weeks by all the negative headlines?
DARLINGTON: Well, Zain, so far they've failed. The negative headlines, those have been the headlines. It's been -- outside of the United States,
there's been a lot of focus on the Zika virus. Fear that's died down, because frankly, we're in the middle of winter and it's hard to find a
mosquito. But I know that outside of Brazil, a lot of people still believe that Zika is a big problem. Here in Brazil, they're -- we're already
having an audio problem here. Here in Brazil there's a lot of focus on the money issues and the fact that -- teachers aren't getting their salaries,
doctors' salaries are behind. You know, the police were getting their salaries until the state of Rio de Janeiro declared a state of financial
calamity.
That the federal bailout enabled them to pay police and able them to finish a metro line needed to connect the venues here in the Olympics. They
really have not been able to keep all the negative news out of the headlines. The idea is that going forward everyone will want to look at
the athletes themselves, those inspiring stories. Who's winning, who is falling by the side. And it all starts today, Zain. We'll see where it
goes.
ASHER: It's been an uphill PR battle for them. Shasta Darlington, live for us there, thank you so much.
[16:05:00] All right, I want to go straight now to our Nick Paton Walsh. He joins us live now from Copacabana where there have been protests pretty
much all day. Nick, explain to us, how come are these protests? Even though there have been so many troubles, what specifically are the
protesters angry about?
NICK PATON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT: They were not in Copacabana right now, we're actually on route towards the opening ceremony.
We're caught in the crowd. We're about three kilometers, possibly less, away from the actual venue where in three hours from now the opening
ceremony will be taking place in Maracana stadium. This group of riot police behind me have been walking now for I'd say about an hour to an
hour. We're behind them, pretty dedicated, very young group, often black- clad protesters.
It's fair to say they're pretty angry with the general state of affairs in Brazil. But they do also reflect a broader disenfranchisement and anger
across the population over how much money has been spent by the Brazilian government on the Olympics. And making those venues will see in the hours
ahead so glittering rather on normal social services. They're beckoning us through their lines here. As I say, apart from one brief scuffle I believe
occurred just off to one side here. But that's been predominantly peaceful.
It seems to be a moment in which the riot police brought in cavalry to stop the progress of this march. I think we've got about 2 to 3,000 protesters
behind it. It's hard to tell, frankly, given how diffuse it all is. Their grievances are predominantly against how the government is run here.
Against frankly, a lot political feelings reflecting the disenfranchisement that many in the country feel. Whatever is occurring behind closed doors
in Brazil, the corruption scandal, the impeachment, doesn't reflect any changes in their political life. It's simply the cards are being shuffled
again between the same corrupt players and their ideas.
But behind me is this protest. As I say, we're about two kilometers or so plus away from the venue. They will not apparently try to go into the
venue we understand. The map that's been put out on the internet shows them not far away from it but sort of moving around it, close enough to
warrant this presence of riot police but nothing necessarily new for the riot police to deal with. These kind of protests have been around before.
But I think on a day like this is not the image that Brazil wanted the world to see. It's about the sport, it's about the vast sums of money
spent on bringing people to the country and making them feel welcome. Making the event still celebratory. Still, these images instead have been
dominating on Copacabana Beach where I was earlier on today. Where police vehicles, government vehicles, Olympic committee vehicles were stopped by
the crowd and heckled to some degree. That stars really today event and does reflect, as Shasta was saying, two-thirds of the population who
frankly don't feel it's much fun at all. We were in a favela recently, an area where police aren't able to go and most people there said they didn't
imagine they'd even watch the games let alone even come done here to partake in it. Very much a spectacle to them, for the right of Brazil,
rather than one that everybody more broadly shares, Zain.
ASHER: It really is a tale of two Brazils. Nick do keep us up to date on those protesters. Nick Paton Walsh live for us there, two kilometers away
from the stadium.
This is one of the biggest moments in Rio's history. Brazil has had to clear so many hurdles to get to this day, as our correspondents were
saying. Getting the games ready has been the biggest challenge by far. Building work on stadiums and subways has gone right down to the wire,
right down to the last minute. Security has also been a problem as well with protesters, as you just saw with Nick Paton Walsh, right up to the
opening day, today, of the opening ceremony. Winning over the public has been a challenge with Brazil in the middle of its longest recession since
the 1930s. And there's a political crisis as well. The list seems to go on and on. We know the Senate is going to be voting next week on the
impeachment trial of Dilma Rousseff, the suspended president. On top of all of that is an international concern over the Zika virus. Just reaching
the starting line of these Olympic Games has been a major achievement in itself. The Rio organizing committee said it would hire 90,000 workers for
the Olympic Games and brought in the HR company ManpowerGroup to help. Earlier Manpower CEO, Jonas Prising, told me the games can help turn
Brazil's economy around.
(BEGIN VIDEOTAPE)
JONAS PRISING, CHAIRMAN AND CEO, MANPOWERGROUP: So the Brazilian economy, as we all know, has been in a deep crisis for quite some time.
Unemployment has gone up from 8.3 percent to 11 percent on the latest measures. So this is a country in some difficulties. The Olympics in Rio
of course, a great opportunity for Brazil and Rio de Janeiro itself to showcase what this country can do.
[16:10:03] I think we'll see some very good beneficial impact after the Olympics. But of course the Olympics are temporary, and the Paralympics
that follow. So the impact can't be exaggerated. But I think it's a welcome relief for a country that's under siege.
ASHER: Given that there will be temporary jobs created as a result of the Olympics, do you think the benefit will also be temporary, especially when
it comes to labor?
PRISING: Well, we are a sponsor and -- or rather, an official supplier to the international committee, and Olympic committee. We're also a provider
to many of the hospitality partners that the Olympic committee has. We have about 15,000 people working for ManpowerGroup during the Rio Olympics.
What we focus a lot on is to make sure that not only do we provide them on- the-job training and opportunity for employment during the Olympics, but prepare them for when the Olympics end so that they can feel that with the
skills that they've acquired during a reasonably short time, they are more employable after the Olympics than they were before. And that is going to
be a great deal of our focus in ensuring the employability of the people that work with us during the Olympics here in Rio.
ASHER: I understand how workers in Rio are going to benefit, particularly with what you just mentioned. What about workers in other parts of Brazil?
PRISING: Well, it's clear that as the unemployment levels are high in Brazil, the labor market is struggling. And as such, aside from any halo
effect that the overall impact of the Rio Olympics will have on Brazil as a whole, I think the solution to Brazil's overall crisis is much more going
to come from a resolution of the political crisis that exists today, being able to drive structural reforms. We saw that the vice president, Temer,
just proposed structural labor market reforms, which as ManpowerGroup we think would be extremely beneficial to make Brazil more competitive. That
aspect of the labor market will be much more related to the overall progress of the country and a return to economic growth, because Brazil has
been struggling. Its GDP is down by 3.5 percent almost, in 2015, about the same in 2016. That's what's going to turn the overall labor market in
Brazil around.
ASHER: What do you think the legacy of hosting the Olympic Games in Brazil will be, especially when it comes to infrastructure, tourism,
transportation, skills training, that kind of thing?
PRISING: We believe that in the end, showcasing Rio, the way an Olympic game does, is going to be extremely beneficial for Rio as a whole. But as
you know, a lot of the debate and a lot of the question is around how will it benefit the state, the city, and the country beyond the actual Olympics.
Although it is very expensive I think comparing to, for instance, the London Olympics in 2012, it is a lot less money that has been spent. The
facilities are planned to be used by the country. And speaking to city officials earlier today, I understand there are close to 50 events that are
lined up over the coming two years, and they are coming to Rio because they've seen that Rio is able to put on a great event such as the Olympics
and the beneficial effects from that will come for years after the Olympics have actually left.
(END VIDEOTAPE)
ASHER: The U.S. economy saw a higher than expected job growth in July. How the Clinton campaign could benefit, that's coming up after a quick
break.
[16:15:00] (COMMERCIAL BREAK)
ASHER: July was a strong month for the U.S. job market. The economy added 255,000 jobs, surpassing many economists' predictions. The unemployment
rate remained unchanged at 4.9 percent. America has added 1.3 million jobs so far this year alone. Job gains for May and June were revised higher and
wages grew 2.6 percent compared to the same time a year ago. I asked the deputy U.S. Labor Secretary why some Americans are not feeling the strength
in the U.S. job market.
(BEGIN VIDEOTAPE)
CHRIS LU, DEPUTY U.S. LABOR SECRETARY: I think this was a great job report. It was not only the 255,000 jobs created. This was really a broad
based job growth among virtually among virtually every single sector. But you're right, the unfinished business of this recovery is wage growth.
Right now we're averaging about 2.6 percent wage growth over the year. And that's good. But you have to look at that in the context of wage
stagnation over the last decade. So it is both possible to say that this is the best economic recovery in history and a lot of people really aren't
feeling the benefits of it.
ASHER: So what's the solution for wage growth, do you think?
LU: Well, there are a lot of things. The president has called for an increase in the minimum wage. We're certainly pushing that at the federal
level. Also at the state and local level. It requires sensible policy proposals like infrastructure spending that create good paying construction
jobs, manufacturing jobs. It also means training people for the jobs of the 21st century so that people can have a pathway into the middle class.
ASHER: With low oil prices right now, what has been the impact on the energy sector? If oil prices stay low, what will happen to jobs in the
energy sector?
LU: You know, that was the one part of the jobs report that was not positive, which was the mining sector, which is really a proxy for the
energy sector. We have been losing jobs there for really about the last two years or so. That is certainly of concern to us in the labor
department. The upside of that is that American consumers benefit from that in terms of lower gas prices. It's about $500 a year in terms of
lower gas prices that they're having the benefit of.
(END VIDEOTAPE)
ASHER: As expected, the strong jobs report pushed stocks in the U.S. higher. The Dow surged 191 points, the S&P 500 and NASDAQ both closed at
record highs. Paul La Monica is at the New York stock exchange for us. This time, Paul, good news is really good news, stocks sort of took off and
they never looked back.
PAUL R. LA MONICA, CNN MONEY CORRESPONDENT: Exactly. Finishing near the highs of the day. It's quiet here right now. That wasn't the case about
20 minutes ago, heading into the close. A lot of excitement about those record highs. I think the key issue, Zain, is that the jobs market, there
had been concerns that we were really starting to lose momentum. A couple of months ago there was a very weak jobs number, that raised some recession
fears in light of everything going around globally. Having two months back to back of very strong jobs growth and as your previous guest mentioned,
wage growth also picking up, that has people excited about the fact that the U.S. economy probably is stable, definitely much more solid footing
than the rest of the world right now.
ASHER: But Paul, you have these stellar job numbers, but just last week we got the second quarter GDP came in at 1.2 percent, not so great. How do
you reconcile the two, where is the disconnect?
LA MONICA: Yes, there's a definite disconnect there. I think part of it is that, obviously, the numbers that we've seen now, this last month, is
going be a third quarter number, so maybe we get some momentum in the third quarter because of strong jobs gains.
I think right now the big issue is that businesses still don't seem to be spending. It's almost as if they're not convinced that this rebound is for
real. Consumer spending actually was up pretty significantly in the second quarter GDP report and that usually boosts overall GDP. But GDP was held
back by slower business spending. That's the key thing we need right now, is for businesses to catch up with consumer demand.
ASHER: All right, Paul La Monica, live for us there. Thank you so much. Have a great weekend my friend.
LA MONICA: Thank you.
ASHER: The positive jobs report makes it harder for Donald Trump to make the case that the U.S. economy is failing. He now has a team of people who
can actually help him with that. Trump has just named his economic advisers. Take a look, you can see some of them on the wall behind me.
Some pretty big names from Wall Street, billionaires, CEOs, and trade experts as well. Among them is Peter Navarro, an economist and business
professor at the University of California, Irvine. He says there's more to the U.S. economy than the latest jobs report. I asked him about his
reaction to the latest numbers.
(BEGIN VIDEOTAPE)
[16:20:13] PETER NAVARRO, TRUMP'S ECONOMIC POLICY ADVISOR: The labor participation rate is the one that I watch as a macro economist. And if
you look at the Bureau of Labor Statistics chart going back to 2008, you'll see a dramatic long, slow slide of that participation rate from above 66
percent down to around 62 or 63 percent today. And that lack of participation is basically an indirect measure of literally the tens of
millions of Americans, long term unemployed, not counted in the unemployment statistics as we do that today, who can't find a good job at a
decent wage.
The other thing about that report was that once again the goods-producing jobs component of that report was anemic. This in turn was reflected in
the other report which nobody seems to want to follow, which is the trade numbers. We saw our trade deficit go up unexpectedly to $44 billion. And
we're running annually a trade deficit of almost $800 billion.
The Donald Trump campaign, really the focus is on doubling our GDP growth rate so it gets back to historic levels and doing that in two ways. One is
by cutting the trade deficit, eliminating through good trade deals, and increasing domestic investment here in America. And now it goes to places
like Mexico and China because of bad trade deals. People need to understand, and I think the people on the street and thrown out of the
factories understand, that if we want to get America great again we really have to tackle the trade deficit and keeping our investment here rather
than in Mexico and China.
ASHER: I want to talk about Donald Trump's economic policies overall, just beyond trade. Because a lot of people, billionaires, businessmen who
understand business, who understand the way the economy works, have spoken out against Donald Trump's policies, including Meg Whitman -- she's not
supporting Donald Trump. She's switching sides to support Hillary Clinton. The Koch brothers are washing their hands of Donald Trump. They're not
supporting him. They're not supporting Clinton. Also, Marc Benioff, Warren Buffett, George Soros, Bloomberg actually came out and said "If
Donald Trump wants to run the nation like he runs his business, God help us." Are these people all wrong?
NAVARRO: Well, the people that you are mentioning, many of those people are precisely the ones who have been leeching off the backs of the American
worker and domestic manufacturers. They have their economic interests, basically, in the whole trade game where you export our factories to places
like China and Mexico, and then you import these illegally subsidized goods into our markets. They make out like bandits and the American people
suffer. So Donald Trump is blowing up the Republican Party portion of the multi-national corporations that have been controlling that party for
years, just like they control the Democratic Party pushing the trade agenda.
ASHER: Peter, hasn't Donald Trump himself benefitted from hiring workers overseas as well, with his businesses?
NAVARRO: This is an interesting question. I think it goes to something that Donald Trump said in his speech in Cleveland. He knows how this
rigged game works, so who better than him to fix it, right?
(END VIDEOTAPE)
ASHER: Navarro says that Trump is the man to fix the American economy. But the Republican candidate actually might have to deal with some issues
closer to home. Foursquare's reporting that foot traffic to Trump's properties have dropped off significantly over the last year. Cristina
Alesci, we're back together again. So how significant is the steep loss, the steep drop-off for Donald Trump?
CRISTINA ALESCI, CNN MONEY CORRESPONDENT: That's a really good question. Clearly this is a great headline for Hillary Clinton supporters. Seventeen
percent decrease in March and April compared to the same period last year. Significant decreases. It's important to keep in mind that two of the
biggest properties that saw these declines were in blue states. We're talking about Trump Soho and Trump tower in Chicago.
ASHER: So he's not on friendly turf here.
ALESCI: Exactly. That may have played a role. Also women, there was a double digit decline in women visiting the properties, playing into this
idea that perhaps, you know, this idea that Trump is anti-woman is resonating. But, Zain, you know, as well as I do that foot traffic doesn't
necessarily mean less profits. Because it's unclear how much these people would have been spending in his resorts to begin with. And let's not
forget, most of his deals are structured as licensing deals. So for the ones that he doesn't own outright, which are many of these hotels and
casinos.
ASHER: He has the Trump name but that doesn't mean he actually owns them.
[16:25:00] ALESCI: Exactly. He gets paid on those licensing deals, probably, even if foot traffic goes down and perhaps even if profits go
down. He will get a steady licensing fee depending on how these deals are structured. It's unclear how much it's hurting him in his pocketbook.
ASHER: So in terms of foot traffic though, in terms of the decline, you would think that actually running for president would help you purely
because of the PR and the publicity associated with running a presidential campaign.
ALESCI: I think it's really interesting that you bring that up. When we look at his personal financing disclosures, and we looked at two have come
out since he announced his candidacy, his run for office, and what you have seen is an actual increase in some of the property values and some things
associated with his name. Book sales, for example, his book sales have gone up, probably journalists buying them to report on him.
ASHER: Same thing happened to Sarah Palin.
ALESCI: Exactly, and so you're right, we don't know how much he's going to benefit now and after, even if he doesn't win. There was a story just a
couple of weeks ago about him talking -- an NBC executive being asked whether or not Donald Trump could be -- whether he could hire Donald Trump
at some point again. So, you know, it probably is beneficial to his bottom line. We just don't have the numbers to prove it yet.
ASHER: Cristina Alesci, thank you so much, interesting report. We appreciate that.
New polls have not been so kind to Donald Trump. According to a new poll from "Investor's Business Daily," he trails Clinton by seven points
nationally. She's at 46 percent. He's at 39 percent. And in the swing state of New Hampshire, he's even further behind. Clinton has a 17-point
lead there. And Clinton even has a slightly solid lead in Republican states like Georgia, who would have thought. CNN's Jim Acosta is with the
Trump campaign in Iowa. Jim, with these polls it really is the swing states that matter for both candidates. Donald Trump has three months to
turn this around. Can he do it?
JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, he can certainly do it. I think it's way too early in this campaign to write off any
candidate. Obviously, you know, there's a lot of ground to catch up for Donald Trump. Nobody would have thought after these conventions that he
would sink to this 15-point deficit, if you look at this Palatchi/Marist poll here in the U.S. There's an NBC/Wall Street Journal poll that shows
the deficit at nine points.
That is ground he can make up. But it's going to take a lot of fixing. And I can tell you that there does appear to be a sign, at least today,
Zain, that he is making a course correction. Earlier in this week you heard Donald Trump say he was not ready to endorse the Speaker of the
House, Paul Ryan, a fellow Republican who stuck his neck out and endorsed Donald Trump earlier in this campaign cycle. CNN has learned that Donald
Trump later on this evening when he goes to Wisconsin after this event here in Iowa, will endorse the Speaker of the House Paul Ryan. And that comes
after apparently the chairman of the RNC, Reince Priebus, was very upset about what Donald Trump had to say earlier this week, and after Paul Ryan
was barely containing his feelings when he was talking on a series of radio interviews earlier today, saying he didn't want to get into a petty back
and forth, as he called it, with Donald Trump. That goes to tell you just where his feelings are on all of this.
I did talk to people with Paul Ryan who say at this point, basically until this endorsement is spoken, they have nothing to say about it. They're
referring our questions to the Trump campaign. There's one other course correction we're seeing, for the last several days Donald Trump has been
talking about how he's seen this video of the $400 million that the U.S. sent to Iran that has been accused of being ransom money. The White House
says it's not ransom money. The Trump campaign or the Republicans have said yes, it is. Donald Trump has said for days now that he's seen video
of this payment arriving in Iran. Earlier today Donald Trump put out a tweet saying no, he was talking about the plane carrying the American's who
were held landing in Geneva, Switzerland. So he did issue a correction in a tweet, Zain. That is also something we've not seen. So this has been a
very un-Trump like day out on the campaign trail for this candidate. Because he normally just doesn't admit he makes a mistake.
ASHER: He's definitely changing course. Jim Acosta live for us there, thank you so much.
The stadiums are new and the beaches are stunning. But Rio's slums are kept out of sight for these Olympic games, are finally being put on the
map. We'll explain, after the break.
(COMMERCIAL BREAK)
[16:31:49] ASHER: Hello, everyone, I'm Zain Asher. Coming up on the next half hour of QUEST MEANS BUSINESS, Google puts Rio's favelas on the map.
And China goes shopping in Milan for a football team. Before that these are the top news headlines we're following on CNN at this hour.
The eyes of the world will be on Rio de Janeiro when the Olympic opening ceremony begins less than three hours from now. The official opening will
be held at Rio's Maracana stadium. There's no word who will light the Olympic flame. One sports star who won't be attending is Pele, who says he
is too unwell to attend at the ceremony.
London police arrested ten protesters on Friday who were blocking the road leading to the Heathrow Airport. The activists were with the U.K. branch
of Black Lives Matter. The group says it was marking five years of the killing of a man by police which sparked nationwide protests.
At least 30 people are dead, and 15 wounded after an attack in northeast India. Police say three gunmen opened fire Friday morning at a market in
Assam state. One was killed, two remain at large. Authorities blame the attack on a Christian separatist group that India has classified as a
terrorist organization.
Not far from Rio's glittering stadiums is a side of the city that most visitors will not see. One in five residents live in favelas. Until
recently you wouldn't have known it from looking at a map. Google has undertaken a two-year effort to literally, literally put Rio's favelas on
the map. This what Rocinha one of Rio's biggest favelas looks like on Google.
So far they have worked on 26 favelas giving 10,000 businesses online presence. Google went even further in an effort to change outsiders'
perceptions. They've put together an interactive profile of life inside the favelas.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Hi, I grew up here in Rio. If you come with me, you'll meet extraordinary people, people who will inspire you and make you
look at the favelas in a whole different way. I'm sure it will surprise you. It all starts right here at the entrance with the motor taxis.
Whenever you're ready, let's go for a ride.
(END VIDEO CLIP)
ASHER: Just a snippet for you there. Earlier I spoke to Esteban Walter, Google's marketing director in Latin America. He explained this kind of
project has benefit for Rio's citizens and for Google as well. Take a listen.
(BEGIN VIDEOTAPE)
ESTEBAN WALTER, MARKETING DIRECTOR LATIN AMERICA, GOOGLE: Our products we want to build them always for everyone. We want to make sure they include
everyone. For us, you know, having all these areas mapped and allowing people to know what goes on, to know addresses, to find the places there.
And not only that, also allowing the people who live there to be able to sometimes have an address, be able to be found on the map.
[16:35:00] We've heard from many people in the communities saying like, you know, not being on the map feels like not existing. We've heard it from
many people, citizens of the communities.
ASHER: Will there be any sort of tangible benefits for them, beyond being found on a map, how will it benefit local businesses, public perception of
these favelas, economic activity in the area?
WALTER: So two sides of it, one is the intangible, the pride, the inclusion side, being part of communities and integrating the favelas into
the rest of the cities. The other one is the economic one, obviously too. A lot of businesses are amazing businesses, amazing cultural activities
happening in these communities.
The fact that those were not easy to access or to find will change through this mapping. We'll see a lot of benefits going from economic, to social,
to pride inclusion. The other side is also very important, there's a lot of pre-concepts about what goes on in the favelas. People think they're
mainly areas of violence, of poverty, of drug dealing.
And we wanted to make sure that through this project we help people change this perception and we help people showing the other side of the favelas,
that there is incredible people living there with amazing life stories, with a very tight sense of community. The people that live in the
communities, they're really in the favelas, they help each other a lot. We have to make sure this comes through, you know, through this work.
ASHER: Did you yourself have some of these preconceived ideas about Brazilian favelas that you realized after this project were not true?
WALTER: I do, yes. I think like we did a study, and it showed that once you visit, you get to know the favelas, your preconceptions, your
perception improves three times more. So in my personal case, yes. I go to access, you know, like incredible places, met amazing people there,
amazing businesses that are taking place there. There's incredible educational projects happening. It's been very special too from a personal
perspective.
ASHER: Are you disappointed that you haven't sort of completed the entire project before the start of the opening games?
WALTER: No, not at all. I think, you know, like this project has been very dependent on the ability to access the communities on an ongoing
basis. I think the number of 26 if you ask me, I wouldn't have imagined, having mapped 26 communities. We've put 10,000 businesses on the map. I
think the impact, more or less we imagined like 500,000 people live in these communities.
So the impact has been amazing up to date. I think we have a lot of work to do. As I said, in Brazil there's 12 million people that live in
favelas. In Rio only 1 million. So we have a long way to go. We have to continue this project going forward.
(END VIDEOTAPE)
ASHER: AC Milan have something in common with their better rivals, Inter, they are both owned by the Chinese. Silvio Berlusconi has sold AC Milan to
a Chinese consortium for around $800 million. It come just two months after Inter was sold to a Chinese company.
West Bromwich Albion in the English Premier League were also sold to a Chinese entrepreneur today. Manchester City and Atletico Madrid also have
major Chinese shareholders as well. To discuss all of this Patrick Snell joins us live now. We're seeing Chinese investors snapping up football
clubs all around the world. Explain to us this trend, Patrick. Are they trying to build their reputation as a football nation?
PATRICK SNELL, CNN CORRESPONDENT WORLD SPORT: No question about that, we've seen from the clubs that you've just detailed there, Zain, it's an
ongoing process.
Look, it's popular in China, the first of the major football leagues to be shown live on Chinese state TV. There is that legacy there. With the two
Milan clubs, both Internazionale and AC as well, Internazionale snapped up and now AC Milan as well.
I think Berlusconi at the age of 79 has realized the glory days of bringing star power to the club, like Marco van Basten back in the day, those days
are long gone. He oversaw the club's most prosperous, trophy-laden era in the club's history.
Remember this is a club that has seven European Cup titles or champions league to give it its modern reference, second only to mighty Real Madrid.
The facts are these, the fans are so used to success of that club, they've been starved of it really. Their last good title coming in 2011.
I know that's only five years ago, but if you're a Milan fan, you expect instant success and expect it to keep going. That is a long, long time
their last champions league title, nine years ago now.
[16:40:00] And the fact is the results, they failed to finish in the top six for each of the past three seasons, that's the worst run of the
Berlusconi era.
He sees an opportunity to get these investors on board and they need to tap into what could be the expansion of an already big brand, turn it into a
huge global brand. Milan is voted 14th on the rich list of world football according to Deloitte. This is potential there but the club needs to tap
into it and not let big rivals like Bayern Munich, Manchester United, Real Madrid get too far ahead of it.
ASHER: In terms of performance, as you mentioned, they haven't had the best run in recent days. What will the new ownership mean for AC Milan's
financial resources, especially when it comes to snapping up new players left and right?
SNELL: They need to be more competitive in the market. And they've failed to do that. I mentioned van Basten that seems like a lifetime ago, if
you're a Milan fan. The fact of the matter is these new investors -- they need to clear away the debt.
The debt estimated to be at around the $240 million mark already. We understand -- and remember this deal is not yet finalized, it's expected to
be finalized by the end of 2016. There's an agreement here to move forward through the year. But there's reportedly going to be a $120 million
immediate payment to wipe away a good chunk of that.
Then the promised investment, we understand, the new owners to invest around the $390 million over the course of three seasons. That's going to
make Milan competitive at the highest level of world football when it comes to attracting star power. Star power they badly need to get back on course
for a club that expects only success.
ASHER: Patrick Snell live for us there, thank you so much.
It's a bird, it's a plane, it's your next delivery from Amazon in its quest to get packages to your door in 30 minutes or less. Amazon is unveiling
its first of many cargo planes. We'll have the story after the break.
(COMMERCIAL BREAK)
ASHER: Amazon is taking vertical integration to new heights. To 43,000 feet, to be exact. The company is debuting Amazon One, the first of 40
cargo planes in a fleet called Prime Air. This is the latest in Amazon's efforts to get packages to your door as quickly as possible. They already
use robots in distribution centers, have one-hour delivery in some cities, and have been exploring the use of drones. So walk with me over here to
introduce my next guest, Lawrence Ulanoff, is the chief correspondent at Mashable, good to have you on the show, sir. As you just explained to me,
how is Amazon going to use Prime Air to draw in new customers, do you think?
LAWRENCE ULANOFF, CHIEF CORRESPONDENT, MASHABLE: They're actually doing a pretty good job of delivering packages in two days. This will give them
greater flexibility, more distribution, the ability to deliver more packages on their own.
Obviously for a long time Amazon has relied on third parties to deliver everything. This give us them more control. And the can make more
promises.
[16:45:00] It doesn't necessarily change how quickly they'll be delivering things. Amazon has been trying to build more local delivery systems for
that day of delivery.
ASHER: How expensive is this as an undertaking for them?
ULANOFF: Oh, it's millions of dollars. They've bought -- I think they have 11 planes already out there flying around. These are just the first
couple that they painted. They're not cheap planes, they're big planes. They talked about this earlier in the year. It's not necessarily news that
the planes exist.
But it's news that they're really making a big splash, painting them. The company has had some good earnings, so they can certainly afford to spend
the money. This goes directly to their bottom line. For Amazon it's about selling and delivery. At this point, nobody's beating Amazon on delivery.
ASHER: What can we learn from this about Amazon's expansion plans? Now we're hearing about cargo planes. A few weeks ago I learned about drone
delivery in the U.K., they were testing that out. What's next?
ULANOFF: They would like to get drone delivery off the ground especially in the U.S. that's a little bit difficult because the recent FAA rules said
they have to be operated line of sight with the pilot, which means that's not going to work for what Amazon had been planning. I know the White
House is still trying to figure out make sure that commercial enterprises like them can do so.
Beyond that, there is also some retail expansion on the Amazon side, you know that they have a bookstore in Seattle, they're opening another. Jeff
Bezos said earlier he is going to build more physical stores. They're not just going to sell books in those stores. I think that's kind of part of
their next expansion plan.
ASHER: In terms of the cargo planes, because they're not hiring outside companies like UPS or FedEx, will it be cheaper for consumers at all?
ULANOFF: I don't know about that. It's hard to know what the cost savings will be. Obviously a lot has to do with the cost of jet fuel, to be quite
honest, which is one of the most expensive things, it fluctuates a lot. I don't know if it's a tremendous cost saving. It's maybe about
efficiencies.
I have no idea if they'll be passing on more cost or if there will be some kind of savings. As it is, Amazon Prime, it's about advertising the
service, which costs $99 a year. They could have just called them Amazon Air, they didn't. They're trying to really brand it even more forcefully
to get more people to buy into that and into Amazon services.
ASHER: I saw that Prime sale and that's trying to get people to sign on to Amazon Prime as well. Lawrence Ulanoff, thank you so much for being in the
studio with us.
Another story we're following, chip cards are very common in Europe. Here in the U.S. they're gradually gaining in popularity. CNN Money's Laurie
Segall reports how hackers can manipulate these cards to make cash literally pour out of an ATM machine. Take a listen.
(BEGIN VIDEOTAPE)
LAURIE SEGALL, CNN MONEY CORRESPONDENT: Chip cards. They take forever. On the bright side, they're also more secure. They're supposed to stop
criminals from stealing our information. But the very thing that makes them take longer may also make them vulnerable.
On an old fashioned credit card, the data sent to the register is static, it never changes. On a chip card, the data is randomized, which means it's
only good for one transaction. Normally information that expires after just a minute would be useless.
But if hackers could steal it and use it all before it switches again, they're in business. And new research shows that might actually be
possible if hackers can crack open a store register and add something called a skimmer. Maybe they're friends with the cashier, maybe they own
the store themselves.
Whatever the case, the hackers wait for you to insert your card and then their minute begins. Here is how it works. During that minute, the hacked
register is stealing all of your card's information. And wirelessly transmitting it to another device the hackers have set up elsewhere, like a
smartphone ready to make a mobile purchase or in this case a hacked ATM that's confusing the data for your physical banking card. And --
First of all, wow. What did we see? Can you explain what just went down?
TODD BEARDSLEY, RAPID7 SENIOR SECURITY RESEARCH MANAGER: The data on the card is getting transmitted to a device that's inside this false front
here. And then that in turn is starting to punch in all the data, punching in the PIN, asking for $200, and getting withdrawal.
WESTON HECKER, CYBER SECURITY EXPERT: There's basically robot hands that are putting the PIN numbers in there.
SEGALL: You had to take over almost two devices to make this happen. How likely is this to be widespread?
BEARDSLEY: What we're trying to do is envision the kinds of attacks we feel are likely to happen once the U.S. moves over more completely to the
chip and PIN standard. It's not like the criminals are going to throw up their hands and say, you took away my mag stripes I'm out of the credit
card fraud business.
[16:50:00] I would expect to see some variation of this, maybe in two years hence. You're not going to see this today.
SEGALL: You have the skill that enables you to hack an ATM and make money just kind of flow out. Yet you want to use this skill for good. A lot of
people would want to take the money and run. What is it about you that makes you want to use this power for good?
HECKER: I like being ethical. I like being able to go out into society and not be scared that if I hear a knock on the door, it's going to be the
police.
BEARDSLEY: I love the internet and I'm a big technophile. I want stuff to keep working. The only way it's going to keep working is if good guys are
working at least at pace with the bad guys.
(END VIDEOTAPE)
ASHER: Next on "QUEST MEANS BUSINESS," the ruling party in South Africa suffers an historic setback in elections. We're live in Johannesburg with
the latest.
First, enjoy the best of make, create, innovate.
(COMMERCIAL BREAK)
ASHER: You may have heard a dramatic political shift is taking place in South Africa as I speak. The ruling ANC party is facing its biggest
election year losses since the end of apartheid over two decades ago. CNN's David McKenzie joins us from Johannesburg. David, this is really a
warning shot for the ANC, one of the ANC's worst electoral setbacks. What do they learn from this, do you think?
DAVID MCKENZIE, CNN INTERNATIONAL CORRESPONDENT: They'll learn they need to pay attention to the needs of the voters. That's certainly what the
opposition parties are saying, Zain. In some level they are probably going to try and point the finger, internally, perhaps, not publicly, to
President Jacob Zuma.
Many people said the series of corruption scandals, his decisions with the economy, and all the issues he's placed to the fore are the reasons they've
turned their back on the ANC this time around. Whether this is longstanding issue they will face or just a temporary blip remains to be
seen.
The results are as follows, in that the three most contested cities, including of Tshwane, Johannesburg where I am sitting and Nelson Mandela
Bay, the ANC won't get a majority in any of those three cities. In fact, the official opposition, The Democratic Alliance has won Nelson Mandela
Bay, of course particularly embarrassing for the ANC since it's named for Nelson Mandela, Zain.
ASHER: Hugely embarrassing for them. I am just curious, so what is the future of the ANC? How much influence does the ANC still hope to have?
MCKENZIE: They still are an elections juggernaut and they are the ruling party. And in rural areas they still onehandedly, it's this kind of
projection we're seeing, the shift away from legacy politics to delivery politics. Many people I've spoken to have said they're loyal to ANC, which
of course in the years and decades after apartheid was a very powerful thing here in South Africa, is fading somewhat as the new generation starts
to vote.
[16:55:06] And what they're more interested in is whether the government can deliver on their promises. You've also seen a slowing economy, zero
percent growth, more than 50 percent unemployment among youth. Many people are angry with the level of future they have in this country. Some are
turning to opposition parties, both those market orientated opposition parties and the populist ones that are appealing particularly in urban
areas.
ASHER: Given that inequality, is such a huge problem as you mentioned, especially with such high unemployment, how can the ruling party counteract
that and solve that problem, David?
MCKENZIE: Well, they need to get down to work. It's very difficult at this point to kick start the economy, because some of those macroeconomic
issues are working against them here in South Africa. You know, you're seeing the slowing of the economy, down to zero percent growth.
You had these actions by the President, Jacob Zuma, to remove the very respected finance minister late last year, put in a back bencher, under
pressure from investors put in a previous finance minister in Pravin Gordhan. There does seem to be a steading of the ship in terms of the
economy. At this stage it really needs some kind of kick start, I don't think there are any easy solutions at this point.
ASHER: David McKenzie, thank you so much.
U.S. markets got a boost from the strong July jobs report. All three major indices closed in the green. Dow and NASDAQ both soared more than one
percent. S&P 500 and NASDAQ both closed at record highs.
That is QUEST MEANS BUSINESS. I'm Zain Asher. Have a great weekend. The news continues right here on CNN.
END
