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Quest Means Business
A Senior Trump Administration Official Says President Trump Will Keep U.S. Troops in Syria for Now; Robert Mueller Tells Trump Lawyers that the President is not the Target of a Criminal Probe; China Takes Aim at Planes, Cars and Soybeans in Retaliation to U.S. Tariffs; Atlanta Struggles to Recover from Ransomware Attack; Boeing Pushes U.S.-China to Avert Trade War; Facebook Says Cambridge Analytica May have had Access to Data of About 87 Million Facebook Users. Aired 4-5p ET
Aired April 04, 2018 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
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RICHARD QUEST: What a day, big (ph), wonderful, strange consort (ph). It was a bit of a whimsy gavel to put an end to a trading day. Slightly
unusual, before we see the date, I just show you, you`re down 500 and you close up 232. In other words 780 points on Wednesday, the 4th of April,
giant swings 780 points from one extreme to the other as the U.S. and China ramp up for what`s looking like a trade war. Mark Zuckerberg sets the date
for Capital Hill and is holding a conference call as we speak, we`re listening and controversy (ph) for a British captain of industry, Sir
Martin Sorrell, regularly, frequently on this program accused of personal misconduct. I`m Richard Quest and live in the world`s financial capital,
just look at it; New York City, where of course I mean business.
Good evening it was the most extraordinary, stunning comeback for stocks; one of those days that probably almost goes down in history. President
Trump`s advisors have been soothing the market and China`s announcing plans to hit back at U.S. tariffs. So the start of the day, the bears were out in
force as Wall Street opened. And the Dow climbed to nearly 800 points over the course of the day. The biggest swing in some two months, we need to go
over to of course, the Quest Means Business Trading Post where you see exactly - - OK when I came to work and when I was with you at CNN Money at
9 AM this morning and we had losses on the Nasdaq, three percent; the Dow and the S&P, I would have said clearly it was red all the way. But no at
the close of day (ph), up one percent, up one percent, up one and a half percent, they all were (ph) green lights across the board at least for the
Dow. No records, we`re a long way off that, but I think it`s a record in its own right and all the markets are now out of being in a correction.
All the sectors are up, but the stat you need to know, we`re still eight percent from the peak, which is to be noted. A few moments ago the White
House admitted there could still be trouble ahead.
BEGIN VIDEO
SARAH HUCKABEE SANDERS: We may have a little bit of short-term pain, but we`re certainly going to have long-term success and we`re focused on long-
term economic principles and making sure that we have a strong and stable economy and that`s exactly what the president`s doing.
END VIDEO
RICHARD QUEST: Clare Sebastian has been watching events with me all day at the New York Stock Exchange and I don`t think any of us ever thought it
would be quite so ebullient. Well we know not - - actually we didn`t think it would be ebullient at all when we saw the opening it down 500 points.
What happened during the day?
CLARE SEBASTIAN: Well Richard I think is the market pretty much showing you everything it`s got in the space of one day, we had that wild burst of
emotion at the open, that then eventually fizzled out; we had that 800 point swing; we had all that headline risk around trade wars which is still
there, it should be noted that Boeing spent the entire day in the red, it still ended in the red. And we had the comeback, it was extraordinary, we
also had some technical trading in there, but what I think we really saw was a shift in the mood around lunchtime and that was after the
administration deployed some of its top economic lieutenants to try and calm the waters.
We had Wilbur Ross out saying that even shooting wars end in negotiations and we had Larry Kudlow, who`s the new guy in the job of chief economic
advisor, listen to what he had to say.
BEGIN VIDEO
LARRY KUDLOW: I mean I would take the president seriously on this tariff issue; there are tariffs (inaudible), but - - he is ultimately a free
trader; he (ph) said that to me, he`s said it publicly so he wants to solve this with the least amount of pain and again - - here`s the key point, both
sides benefit by solutions that lower barriers at open markets do you follow me?
END VIDEO
RICHARD QUEST: Larry Kudlow of course, former chief economist at Bear Stearns, extremely well respected on Wall Street recently - - more recently
a commentator on CNBC. He`s doing what he`s paid to do there.
CLARE SEBASTIAN: He`s doing exactly that Richard, he came out very strongly, it was a very hard sell trying to reassure the markets and it
does seemed to have worked, he`s someone who`s well liked down there as you point out, the markets listen to him, but I think he also kind of excludes
that there was some technical training going on and perhaps people saw a buying opportunity at the lowest point today, it was significantly below
correction level.
RICHARD QUEST: Clare.
CLARE SEBASTIAN:.we may have crossed some technical barriers there and people might have come in to market.
RICHARD QUEST:.how dodgy is this market still in terms of concern about growth and concerns about interest rates, concerns about inflation,
particularly as we`re about to get to Q1`s reporting season?
CLARE SEBASTIAN: I think it`s medium dodgy, if you can put it that way. I think obviously we`re not in a zero interest rate world any more so that
can lead to more volatility, we don`t have the kind of synchronized central bank activity that we used to have, but I don`t think there`s wide-spread
concern that this will lead to a global recession; Sam Stovall of CFRA put out a note today where he said, the old adage states that ahead of
recessions, when the U.S. sneezes, the world catches a cold, but his view is that this time around the global equities have barely wiped their noses
so I don`t think we`re there yet. He says we`re not going to be a bear market, but we could still test (ph) the lows of this correction for a
little while.
RICHARD QUEST: Clare Sebastian whose done sterling work for us down at the New York Stock Exchange, I have no doubt you`ll be there tomorrow. Now the
skirmishes have been growing more and more intense, you`ve really got to think about this - - because at the end of the day what happened today with
China retaliating with the United States, was very much the latest in - - some would say skirmish, some would say trade war, whichever way you talk
about it, we need to head into the war room.
And the trade war room shows exactly the dangers that are now all around us. Let`s put it into some historical context because the best military men
and women always know their good history. The round one was where the United States attacked on the questions of solar panels and washing
machines; China expressed only dissatisfaction at that point. Then you get the big one round two when it steel and aluminum tariffs and on round two,
again there is only negligible response.
But on round two, there was a $2 - - $3 billion worth of goods; pork, apples, various agricultural products that were sent back in return. Now
you get to the biggie; round three and the U.S. announces potentially the list for $50 billion in goods; high-tech industry, goods worth $50 and
China using pure diplomatic speak, it is only polite to reciprocate says China`s Ambassador in Washington, tariffs back $50 billion worth of goods,
but look at which ones they are. They are soy beans, beef, planes, cars, neither of these three take effect immediately. This is the scenario that
we`ve got currently in the war room as you see these three rounds being played out.
The U.S. trade representative is driving the tit for tat. Joining me now, let`s talk to Ron Kirk, who is with me. Now Ron Kirk served as the U.S.
Trade Representative under President Obama. Ambassador, there`s no question, you just heard me go through the tariff levels. If it`s not a
trade war, that`s semantics, it`s as close as we want to get.
RON KIRK: Well it certainly feels like, Richard, we`re planning for one, but one important - - at least I guess moment of a little bit of breath
that maybe helped that market correction that you just talked about earlier, is none of these tariffs are taking effect immediately, even in
the case of what the Trump Administration announced, these 1,300 different items that would total this $50 billion in tariffs.
The American public and American businesses, importantly, have until roughly May the 22nd to make comment on that and tell the Trump
Administration why they think that`s either a good thing or why they think it might be harmful to our economy and China likewise isn`t putting these
on, but we do know if we were to go forward with this, it would do damage not only to China`s but to our economy and in many cases it would hurt many
of our farmers and families and consumers that are looking for this president to try to help grow our economy.
RICHARD QUEST: So what - - as somebody who has been there, in this intervening period, if we accept that this might be a negotiating play or
ploy by the president, what happens? Where is the scope for negotiation over this question of IP theft?
RON KIRK: Well Richard, I think one of the challenges with this administration is that it`s frankly hard to try to identify any consistent
strategic plan, whether it`s on trade or on economic development of security. I mean, it just feels, frankly, to be driven more by Twitter
rage, but I would say, with Larry Kudlow, now who is, you know, fairly - a well credential as someone who believes in open markets and free trade.
There still are those of us who cleaned a (hole) that this is the opening that you know, Salvo in a skirmish and that, perhaps, we can not go to a
full scale war because what the result of that would be and it would not be good for our economy. It would not be good for the world to have the two
largest economies in the world, ratcheting up these (stencil) of tariffs that only really hurt economic growth in the long run.
QUEST: So, let`s look at the President`s tweet that he put out. I`ll read - well, you`ve seen it.
KIRK: Which one?
QUEST: Well, right - I mean, the good - the $500 billion one, but the first one I think is a bit more interesting. He says, it`s not a trade war. This
is not a trade war. We have already - that war was lost many ears ago by incompetent people. Trade deficit of $500 billon, we cannot let this
continue. Now, listen to Wilbur Ross, the Commerce Secretary, talking about exactly this prospect.
(BEGIN VIDEO CLIP)
ROSS: Well, think about it. Even shooting wars end with negotiations. Somebody signs a treaty with someone else. It has whatever terms it has.
So, it wouldn`t be surprising at all if the net outcome of all this is some sort of a negotiation.
(END VIDEO CLIP)
QUEST: What do you make of that?
KIRK: You know, Richard, it`s disheartening and I know - I think I know what was the Commerce Secretary was trying to say, but I don`t think we
should making light a comparison to a quote, unquote shooting war. While they may end in negotiations, but usually, along that path, thousands of
people lose their lives.
And even in trade war, in which nobody is going to lost their lives. We know historically, when we get into these, sort of, tariff races to raise
tariffs, many farmers and businesses and workers lose their livelihood. So, I mean, the challenge, as I`ve said, is just trying to find some coherence.
QUEST: Right.
KIRK: .between what the President tweets and, again, what the policy objective is.
QUEST: All right, now, I`m looking now at a graph. You`ve seen it over the course of today. I`m looking at a graph of today`s market. Down 500 at the
open, closing up 230, a reference range of about 780 odd points without a sizable, noticeable change at around - just after 2 o`clock. Ambassador,
you would agree this is not normal? These are not satisfactory.
KIRK: You know that does not speak well to the rationality about which markets ought to move. And look, there are smarter people than me, you
know, that talked all day about how you want some volatility in the market, that`s part of the natural health of a growth cycle.
But the behavior we`ve seen today, I think, matches, to some degree, the unpredictability and the irrationality of this administration as they, sort
of, just (lurge) from one idea to the next.
QUEST: Good to see you, sir. Thank you for joining us from Dallas, tonight. We appreciate it.
KIRK: Always good to be with you, Richard.
QUEST: Thank you. Now Donald Trump says America`s current partner of trade, the Chinese, you just saw it in the tweet. It cannot continue. A new report
from the Dutch bank ING seems to support the President`s view, showing the imbalance between Chinese and U.S. barriers to trade.
Now, what it basically says is Beijing has been having higher tariffs on imported goods than the United States. And this is the list of some of the
items you`re allowed to transport machinery, (INAUDIBLE) fish minerals, chemicals and the like. Now the Chinese tariffs are higher than the U.S.
equivalent. Only dairy and petroleum are inputs (INAUDIBLE) to higher tariffs when coming back across these (INAUDIBLE) around the United States.
Is one of the authors of that report, head of the International Trade Analysis on ING, he joins me live from Amsterdam. Good even, sir. Thank you
for taking the time. Look, this is an interesting one because there is a common acceptance, I think most with the exception of the Chinese, would
agree that China, on steel, has been dumping with steel and aluminum worldwide at large scale and, B, they have not been playing fair, have
they? We can all - would you agree with that?
RAOUL LEERING, HEAD OF INTERNATIONAL TRADE ANALYSIS, ING: I certainly agree with that because, not only on steel, but on many products they have a lot
higher tariffs than the U.S. does. And also, a lot higher that the EU.
QUEST: In that scenario, if you can`t negotiate those tariffs down and you are gaining market share, then the U.S. is entitled, to some extent, to
take some of the actions its taking.
LEERING: Yes, they are, to a certain extent. In my view, this is just a strategy because they are different, they would impose higher tariffs and
there would be retaliation from the Chinese side and then both countries would be hurt.
I think it`s a strategy from the U.S. administration to impose tariffs and then, subsequently, immediately give exemptions to a lot of countries, not
to China, but they haven`t really implemented the 50 billion (packets) yet and China hasn`t implemented its retaliation that they announced.
So, there`s still room for negotiations. And I think that the Chinese, in the end, will give in.
QUEST: You do? You believe that the Chinese - I mean, even though they may huff and puff and do token sanctions or tariffs, you believe that,
ultimately, they will accept the necessity of higher tariffs against them or reduce their own?
LEERING: Yes, there is a reason for that. That`s the Chinese economy is about five times as dependant on demand from the U.S. as the other way
around. So, economically speaking, it`s in their own interest to give in to the U.S. and, at least, change a few things so that Donald Trump can, you
know, run up to the midterm elections, show some results, as he also wants some other trading partners like EU is included.
A lot of countries introduced steel and aluminum tariffs. Subsequently, has exempted them and said, well, we can make this exemption permanent if you
give me something in return.
QUEST: Now, that`s the interesting point. Let`s go to that area because those steel and aluminum tariffs that have been exempted, in the case of
the EU, on the Australia - on the grounds of what you`re giving me back in return. But in the case of Mexico and Canada, it`s been done on the basis
of what are we going to get out of NAFTA.
So, in all cases, there is a quid pro quo sort before those tariffs are lifted on steel and aluminum?
LEERING: Yes, in my view it`s a blackmail strategy. Here he doesn`t have to give anything in return, only to prolong the exemption, which is not a
subject that is currently in place.
So, this is a very smart way, risky on the other hand, because if countries like China or the EU play this more politically and let prestige have the
overhand, not economics, then they can say, well, we don`t want to negotiate with a gun at our head as the French president has said.
We`re not going give in. If you`re going to impose tariffs, we`ll do the same and we`ll be in a (inaudible) for tax, even if that has economic
consequences.
QUEST: Finally, the WTO in all of this. China has gone to the WTO on the U.S. list on (IP) as opposed, arguably, some would, sort of, say, it`s a
proactive justice that they go to an organization that they (INAUDIBLE) the rules from, themselves. However, that aside, does the WTO have any
relevance in any of this?
LEERING: Well, from the point of view of President Trump, not that much because he has already threatened to step out of the WTO, which, sort of,
indicated that he really thinks that America comes first and that multilateral agreements are in second, third, or maybe even a lower place.
So, yes, it`s petty, but we are dealing with a president now who is not that much in favor of multilateral agreements, being more important than
U.S. interests.
QUEST: Thank you for joining us tonight. Well, that`s done. We appreciate it, thank you for staying late. We`re following breaking news on Facebook.
The social network has revealed that the data scandal more than came with Analytica, possibly wider than first thought.
Over 87 million users could`ve been improperly shared their data. Chief Executive Mark Zuckerberg is holding a conference call on (INAUDIBLE) right
now. We`ll update you when we have more information and we`ll talk more about that. This is Quest Means Business on a very strange day in New York.
(COMMERCIAL BREAK)
[08:43:37]
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RICHARD QUEST, HOST: Welcome back, its Quest means business on a busy day. The Saudi crown prince`s tour of the United States continues it`s now over
on the West Coast. Where crown prince Mohammed bin Salman Nayef is meeting Apple and Google in Silicon Valley. And then when he comes to town he does
it in style.
So in Los Angeles for example, the Four Seasons in Beverly Hills was fully booked out to the entire entourage. The hotel was the venue for some
(inaudible) attract investment into Saudi entertainment.
The theater chain AMC now has a license to run cinemas in Saudi. The first one will be open in two weeks. The chairman of Saudi (inaudible) general
entertainment authority Ahmed Aqeel Al Khateeb told me more about it.
AQUEEL AL KHATEEB, CHIAIMAN OF GENERAL ENTERTAINMENT AUTHORITY: As part of the 23rd division, we are planning to create (inaudible) economy. We want
to capture the artist spending outside the country, which is a approximately $20 billion a year.
They spend it on entertainment and tourism. Therefore we are planning to diversify our economy we are planning on bringing happiness to the country
and we are planning to create jobs. For these are drivers to focus on entertainment and bring the best entertainment options from outside to the
country.
QUEST: Now this is fascinating because movie theaters will be opened as we understand AMC will be opening some in the next couple of months. You`re--
the difficulty of course, is taking a society that has been relatively closed to all these media and suddenly opening it up even in a controlled
fashion. How are you going to do this?
KHATEEB: If you allow me to disagree with you, we have a very open society. They travel, we have almost millions of people outside to enjoy and go to
the theaters and shows and the cinemas and to follow movies.
In addition to this 70 percent of the 50 million Saudi`s below 30 years old therefore they look for happiness and entertainment options. It was very
easy for us to implement all our entertainment options in 2017 and from the beginning of this year 2018. Most if not all our events were oversold.
Therefore it has been a very pleasant journey an easy journey.
QUEST: So what is the range of things? Because obviously it`s still a conservative country with a small (inaudible) it`s a conservative country
with very specific religious requirements so I`m just interested in how far will you allow.
For instance, Hollywood movies to be shown in public entertainment. How far concerts will be allowed? I know you`re dipping your toe in the water. I
just wonder how deep you`re going to get.
KHATEEB: In 2017 we had 2,200 days of entertainment and more than nine million people attended. We brought all kinds of concerts, shows this year
we will have the great Cirque du Soleil coming to Riyadh and we have the Comic Con two weeks ago.
And many concerts, Yani was in (inaudible), I think so far things are moving extremely well. People are accepting all what we do. And I think
Riyadh (inaudible) and the major cities in Saudi Arabia will be like any other city globally.
We have many non Saudi`s who would like to enjoy and (inaudible) and they would like to enjoy the options and we are bringing options to them.
QUEST: Finally, it is a country where the majority is young. Those people have traveled and they are obviously well aware of life outside of Saudi
Arabia. These reforms 2030 how far can they go do you believe? How far will a society like Saudi allow and accept these reforms to go?
KHATEEB: We are doing reforms as part of the 2030 visions on all fronts. Economic, politics and social. The more interesting reforms are the social
reforms as you now we have announced the woman drive and it was widely accepted and supported by everyone.
And also the cinema and other reforms, I think the tough reforms are behind us so far and whatever will come in the future will be much easier than
reforms we have already launch and announced.
QUEST: As we continue tonight, WPP has been the driving force behind some of the biggest marketing campaigns the last three decades. Now the world`s
biggest appetizing and marketing group is facing its own PR disaster.
Shares fell two percent in London, after it immerged that the chief executive and founder Sir Martin Sorrell is being investigated by the board
and accusations of unspecified misconduct. According to the journal and the company hasn`t confirmed, is there is a claim that Martin Sorrell misused
company assets. Sir Martin says, he unreservedly rejects the accusation. Jack Howe is senior editor at Barron`s and I`ve got (inaudible) to know
what he`s alleged to have done.
JACK HOUGH, SENIOR EDITOR, BARRON`S: I don`t the language make me uncomfortable. You know it`s so vague. Every investor when you say personal
misconduct, investors out there thinking how bad are these allegations, on a scale from one to Bill Cosby?
And maybe it`s not about that at all right? They say that the asset amounts are small, that`s important we don`t want to think that there could be any
kind of financial crisis here. But look this is a stock that`s down 34 percent over the past year.
That`s not about misconduct. It`s about very difficult conditions in this business right now and there`s a lot of it, there`s $15 billion of big
brand name advertising business up for bid right now. WPP has more of it to lose than to gain.
QUEST: Right, so WPP has had several profit warnings. It has a massive organizational restructure from a very complicated structure and there`s no
succession in place every time you ask Martin about it. He says we`re discussing it with the board or the board is aware of this. So there`s no
succession in place for Sir Martin.
HOUGH: that`s really the question. This is not about-- to me we like to think people are innocent until they are proven guilty. But what we`re
talking about a publicly traded company, the question is, is he good for business today?
There`s a lot of money up for grabs right now. You`ve talked about Facebook, and the Data`s scandal Cambridge analytics, that not about their
incredible creative talent. It`s about them using data to persuade people.
Guess what? There`s loads of companies out there Coca-Cola, Budweiser that have their hands on perfectly legitimately obtained data. They have the
ability to do more advertising themselves and they want a better deal from the creative agency.
QUEST: So if you`re saying that, then there`s never a good time to have a crisis. A personal crisis, misconduct crisis, but is your view for Sir
Martin is particularly bad time because of the position that WPPs in.
HOUGH: If you`re a big brand deciding whether to stay with them right now, you got it in the back of your head how bad is this thing going to get? Why
take a chance why not go over here with this agency and get a better deal right now, try to negotiate on price. I mean it seems to me the less
riskier of the two paths and I worry that could cause WPP share holders some money going forward.
QUEST: Good to see you sir, thank you.
HOUGH: Thank you very much indeed. I appreciate it
QUEST: Thank you. Now the trading of beans proved particularly difficult for Jack and the bean stalk as the old fairy tale goes after the break, why
China`s taking aim at American beans in a strategic way is fascinating how they`ve done it.
(COMMERCIAL BREAK)
[16:30:00] RICHARD QUEST, HOST, QUEST MEANS BUSINESS: Hi, I am Richard Quest, there`s a lot more QUEST MEANS BUSINESS in just a moment as we`ll
consider new sanctions, new tariffs and what it all means as we continue.
You`re watching Cnn, on this network, the facts always come first. A senior administration official has told Cnn that President Trump is willing to
keep U.S. troops in Syria for now, but wants them to exit soon.
Officials have warned Mr. Trump, the countries such as Iran, Turkey and Russia could take advantage of U.S. withdrawal from Syria and advance their
own national interest.
The U.S. special counsel has told that Donald Trump`s lawyers that the president is not the target of a criminal probe. According to sources
speaking to Cnn, the same sources say Robert Mueller considers Mr. Trump more a witness.
The two sides are discussing whether and how the president would sit down for an interview with Mueller`s staff. Russia`s ambassador to the UN is
requesting a Security Council meeting regarding the nerve agent attack on a former Russian spy and his daughter in the British city of Salisbury.
The request comes even as Russia lost a vote by the organization for the prohibition of chemical weapons to have a joint Russia-British
investigation. Soybean prices fell 2 percent today at the mere hinted with that soybeans are to be part of China`s current retaliation against the
United States.
It`s one of a 106 products that Beijing says will be subject to 25 percent tariffs. So, these are the ones you`ve got. You have some that are going to
be 25 percent of tariffs, and then American soy farmers spent heavily on selling to China.
Some 61 percent of their output went there in 2017. So all of this, this soybean and sorghum and all of the various products that come from this,
they`re all used as a source of oil and as a feed for livestock.
Let`s talk about this with Jim Sutter; the chief executive of the U.S. Soybean Export Council. He joins me from Saint Louis, Missouri. Good to see
you, sir, thank you. You must be up in arms about --
JIM SUTTER, CHIEF EXECUTIVE, U.S. SOYBEAN EXPORT COUNCIL: Thank you --
QUEST: About these proposed tariffs from the Chinese. Who are you blaming? The U.S. or the Chinese?
SUTTER: Well, Richard, we are indeed very disappointed to see that it has come to this. We have been cautiously optimistic that perhaps soy will be
spared. We`ve been working in China for 36 years, trying to promote how you can better use soy to raise livestock to educate consumers there on how to
better raise livestock and process soybeans.
[16:35:00] And we thought we -- we know we have a very good relationship there, so we thought that might outweigh the concerns --
QUEST: Right --
SUTTER: With these tariffs. But I think it was just too much and they had to do something.
QUEST: All right, so now, you are in the position of your members, many of whom voted for Donald Trump in those key states that were --
SUTTER: Absolutely --
QUEST: Firmly in his camp. They must be feeling jipped and cheated if there`s -- it`s down 2 percent if these tariffs come into effect, your
soybean prices are going to collapse.
SUTTER: Yes, certainly, it is very concerning to our -- to the farmers in the U.S. and the whole soy industry. Everybody woke up to this news this
morning, kind of shocked by it, but I think and is looking for how do we fix this?
So you know, you asked the question, who do we blame? I guess what we do is we try to work with U.S. negotiators and continue to encourage them to find
a way to have discussions with the Chinese that result in actually selling more soybeans to China.
We have a trade imbalance situation between the U.S. and China, and the best way to fix that in our mind is try and find a way to do more business
with them rather than using tariffs to do less.
QUEST: Wasn`t it inevitable that this strategically important crop was going to be the secret -- not so secret weapon that the Chinese would use.
I mean, we know Boeing, an aircraft, but soybeans is not far behind.
This -- you could have seen this coming down the road singing Yankee Doodle Dandy with a brass band.
SUTTER: Yes, you know, Richard, you are certainly right. And that`s why I said we were cautiously optimistic, but I think it may indeed have been
inevitable that this came in to this great battle.
I mean, what hopefully will happen is that there are high level negotiations going on, and there can be a solution. There`s a win-win for
everybody, because if this happens, I mean, the U.S. supplies 35 percent to 40 percent of the soybeans that go into China.
And if they don`t have access to the U.S. market, we believe that will indeed increase the prices that their consumers have to pay, that their
people who are feeding livestock, that their consumers who are buying oil, so it will increase their prices which is not what they want to have.
At the same time we`re seeing a decrease for prices in the --
QUEST: Right --
SUTTER: U.S., so not good for anybody.
QUEST: The 35 percent of theirs is coming from the U.S. It`s a large part of --
SUTTER: Correct --
QUEST: The U.S. manufacturer. You probably got the number about out of total U.S. manufacturer or farming of absolutely how much goes to China.
But the reality is tonight, sir, senator, is your industry facing a crisis?
SUTTER: I would say our industry is very concerned. You know, there`s -- among our -- you talked about our members who have supported President
Trump, I think a large number of them continue to support the administration and the work that they`re doing.
They want to see these negotiations be successful. I can assure you that there`s a lot of discussion going on --
QUEST: Right --
SUTTER: There`s a lot of comments from U.S. soybean growers in the U.S. soybean industry to encouraging people in Washington, let`s find the
solution --
QUEST: Right --
SUTTER: Let`s try to work with the Chinese to make cooperation bigger.
QUEST: Sir, thank you for joining us, someday we`ll have you come and join us and explain exactly what goes into soybeans and what they are used for.
Clearly, it`s important agricultural product that we need to understand more. We appreciate it.
SUTTER: I would love to do that, thank you very much for the opportunity.
QUEST: Yes, we continue tonight. Cyber criminals locked up in the city that Atlanta`s filed. They locked up the files and held them to ransom. Two
weeks later, the city government is struggling to recover.
Georgia`s attorney general is with me after the break.
[16:40:00] (COMMERCIAL BREAK)
QUEST: For almost two weeks, one of America`s largest cities has had a ransom being held over its head, ransomware in terms of its computer
operations and they are still not back to normal.
On March 22nd, Atlanta was hit by the ransomware attack with the hackers demanding $51,000. City employees having to go back to working with pen and
paper or sharing aged laptops.
Two weeks on Atlanta courts still contact the customer information will take payments, not in savages at the Cnn center. It sounds like this is
ongoing and although improvements have been made, it`s very slow.
MARTIN SAVIDGE, CNN CORRESPONDENT: It is indeed, Richard, good to see you. Yes, the mayor has equated this to a kind of ongoing hostage situation.
City reports that a lot of the departments that have been impacted by this, starting on the 22nd of last month have now either found ways to repair,
replace or work around the problem.
Essentially, the areas that were impacted were things like online bill payment for many of the citizens, then on top of that, you had an impact in
the municipal court, even the police record system.
You had files that the city had were encrypted by the hackers and thereby denial of access. So the city has been trying to get by and struggling to
do so. We should point out that it was clear that the intent of the hackers here did not appear to be to want to crash the city.
They weren`t trying to bring Atlanta down. The emergency services continue to appear to be unaffected and also critical systems were apparently
unaffected. This was more all about the money.
The fact that the city still struggles implies it did not sincerely pay the ransom and the ransom usually in this case is a figure that`s considered to
be manageable, well, still profitable.
In other words, there`s a real price point, Richard --
QUEST: Martin, we`ll talk about that with our next guest. Thank you, Martin Savidge joining me. Joining me now Chris Carr is Georgia`s attorney
general. Attorney General, thank you for taking the time.
And first question, straight forward. Did you or did you not -- has the state paid any ransom?
CHRISTOPHER CARR, ATTORNEY GENERAL, GEORGIA: Well, Richard, here`s -- I know it`s been frustrating. It`s no more frustrating than anybody than the
mayor of Atlanta and the city council and those that have been working on this issue.
But I know that they`ve been working tirelessly around the clock to fix this issue. And what it is is it`s a complicated issue and it`s very
challenging when you have a ransom attack. And the question is what do you do? Do you pay it? Do you not?
If you pay it, you run the risk of it happening again, and if you don`t, then you have the complications that obviously the city has engaged in. But
what I think is important to your viewers is today, it`s the city of Atlanta, but tomorrow, it can be anybody else.
QUEST: Right.
CARR: If you look at the last week, you`ve seen pipelines that have been shut down --
QUEST: But --
CARR: You`ve seen Baltimore`s 911 system, that`s the challenge that we all face --
QUEST: Right, and that is certainly a case, and I`m sure there are many in Atlanta who are now thinking about locking the stable door after the horse
has long since bolted. Why didn`t we back up? Why didn`t we do this? Why didn`t we do the other?
But the reality is, once you are in the situation, do you pay or do you not?
CARR: Well, I think that that`s a strategic decision that everybody has to face. Again, I think the challenge that comes, if you do pay it, you run
the risk of it happening again. And this is why you have to have a plan, you`ve got to have training of employees, you`ve got to have a good
relationship with federal, state, local individuals and the private sector.
But at the end of the day, I really do think, again, having a plan in place, being prepared to deal with a cyber attack is critically important.
QUEST: I had to push you on this because, you know, viewers watching will say, well, I get it, he didn`t answer the question. So I`m going to give
you three options. On the question of did you pay or has Atlanta or has Georgia paid?
You know, did you pay? Did you not? Or would you prefer not to answer that question?
CARR: I would -- the state of Georgia has not paid to my -- as I understand, to my anything that I have as far as my knowledge. But the
question will come, these issues will come up again in the future.
[16:45:00] Whether it`s the state of Georgia, whether it`s somebody else. And that`s going to come up to each individual entity to decide. But this
is why it`s critically important that we deal with this. This is not the last time this is going to happen to a city, to a house of worship, to a
company, to a nonprofit.
And being prepared on the front end is critically important and there -- so that we know what happened in each particular event. But then what do we do
--
QUEST: Right --
CARR: To prevent these in the future?
QUEST: Well, the British government of course will be familiar with the national house service. Just last year, had a very -- I can`t remember the
exact name of the ransomware attack, but it was a particularly brutal one that did shut down the emergency services.
And what a cry -- it was a call, thank you. Did shut down emergency services. So do you think we -- I guess -- funny, we`re not treating this
seriously enough, are we? We sort of think, A, it won`t happen to us, B, if it does happen to us, it won`t be that serious, and C, while we can always
pay the ransom even if it did happen to us.
CARR: Well, that`s the thing I think we got to all pay attention to. How often these attacks, these crimes -- and let`s also be --
QUEST: Yes --
CARR: Very clear, these are crimes that are being committed. How often they are occurring and how disruptive they can be. And again, I think that we
all have to come together, whether it`s the private sector, whether it`s federal, state and local governments and organizations and entities to
address these issues being prepared to --
QUEST: Yes --
CARR: Beef the plan ahead for what`s going to happen. Because Richard, we`re doing more and more online. We are purchasing more online, we are
storing more information online in the cloud, whatever it may be.
And that`s a good thing. But what it also does is it provides a lot of opportunity for those who want to commit crimes.
QUEST: Attorney General, thank you for joining us, much appreciated, it`s a very important subject, and one that you`re quite right, sir, everyone of
us at some stage is going to fall foul and be on the receiving end of this criminality as you rightly point out. Thank you.
Now, Dock & Bay say their business wouldn`t be the same without the internet, and in this week`s edition of TRADERS, let`s meet the
entrepreneurs who are changing the way you dress and behave at the beach.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: This is a story about two globetrotting friends who started with a curtain and ended up with a multi-million dollar business
that`s rebound the travel town.
That`s Ben Muller, one of the two founders behind Dock & Bay which sells careful, quick-drying sand free towels. Because three years ago, on a
chilly night in London, when Ben and his friend Andy Jeffries first came up with the idea.
BEN MULLER, CO-FOUNDER, DOCK & BAY: Always traveling wherever the sun shone. So we decided that we need to reinvent the travel towel, normal
beach towels, big hockey, and take ages to dry and the sun gets so stuck in them.
If you`re traveling, if you`ve got a family with a bunch of kids, if you`re surfer who circles the beach, you need something more compact, something
light weight and something more convenient.
Want anything? Ripped out the curtain off my room. I mean, you lace and wash up the paper on it, and visualize out first beach design to travel
towel, and that`s when Dock & Bay was born.
UNIDENTIFIED MALE: Matroom(ph), what they call suede microfiber, the towels are composed of 80 percent polyester and 20 percent polyvinyl, although
other micro fabric troubled house from brands like Bodi(ph) and Sea to Solid(ph) exists on the market.
Dock & Bay say theirs are different.
MULLER: What makes our towels unique is it`s really compact in lightweight, yet they fold out really large. They`re also really absorbent. They hold
over twice of running water and quick drying.
Drying off more than two to three times faster than the normal cotton towel. And best of all, sand check is right off.
UNIDENTIFIED MALE: Running the other half of Dock & Bay from London is Andy. As e-commerce is the number one driver for their business, remaining
global and online at all times is key.
ANDY JEFFRIES, CO-FOUNDER, DOCK & BAY: We actually started off the business through Amazon back in 2015 where we started to sell like 50 to 100 a day
quite quickly, and we would have just never have access to that market so instantly without Amazon.
UNIDENTIFIED MALE: By 2022, the global market, the swimwear and beachwear is projected to be worth almost $23 billion. The largest market for
swimwear well liked is Latin America led by Brazil.
Asia Pacific is the fastest growing market, spear-headed by upwardly mobile Chinese countries. Since the company first launched, Dock & Bay have sold
over 300,000 towels around the world.
And appearance in 2017 on "Dragon`s Den", popular U.K. TV show for entrepreneurs saw the towel traders absorbing expert advice and gaining a
further boost in both investment and brand profile.
[16:50:00] And with annual turnover more than doubling to $3.6 million last year, there`s little sign of towel sales drying up.
(END VIDEOTAPE)
(COMMERCIAL BREAK)
QUEST: So statement from Boeing which says it is hopeful about efforts to avert a trade war. The statement in which the company points out -- "the
dialogue between the U.S. and China is ongoing, neither country has actually imposed traumatic tariffs."
Yet, Boeing says will continue to speak to both sides and stress the benefits of a strong aerospace industry. Boeing shares are down around 10
percent since the beginning of March.
Facebook says Cambridge Analytica may have had improper access to data for some 87 million users, far higher number than first thought. Mark
Zuckerberg has been speaking on a conference call with journalist Lori Siegel was listening in.
Honestly, what`s the takeaway from the conference call?
LORI SIEGEL, CNN: I think the take-away is that he is willing to take a lot more questions. I mean, this is a 45-minute call, it started out with him
saying a couple of things, and then just people just started asking him lots and lots of questions.
And one question he kept getting was are you the best person to run this company? And he would respond, yes, I absolutely am, and he said, life is
about making mistakes. But I think, you know, Facebook is on this larger tour of transparency now and trying to explain what exactly has happened
with the user data.
I mean, the idea that we went from 50 million to 87 million now, I think there`s less patience for it, but he did explain where that number came
from. They looked at the mass impact of where that could come from.
So it`s up to 87 million.
QUEST: This question, are you the best person? You -- I mean, let`s face it, you know, they knew about this some years ago --
SIEGEL: Right --
QUEST: They didn`t do anything about it, they try to -- they got near the person to delete the data, but never checked up that it was deleted --
SIEGEL: True --
QUEST: And is he the best person to run the company? I mean, is a public company now, although it has a weird share listing which effectively gives
him control. Which by the way --
SIEGEL: Right --
QUEST: In my own thoughts is a very good reason not to have these weird chart listings --
SIEGEL: Right --
QUEST: Which gives people control.
SIEGEL: Listen, I think that Mark Zuckerberg has an incredible reputation behind the scenes at Facebook. He`s known as someone, you know, who is able
to take on these complicated problems.
But the complication about Mark Zuckerberg is he hasn`t been able to forward-facing with this. Now, they`re answering a lot of challenging
questions behind the scenes and they haven`t been transparent enough as a company.
You know, they`ve been too reactive and not proactive enough. You know, he says at the beginning of the call, he said we did not take a broad enough
view of this. And a journalist ascent, you know, you were flipping about saying that fake news impacted the election, and he said -- and you know,
he came out and he said I was too flipping on a lot of this.
So I think he`s also -- you`re watching him almost grow up. You know, there was --
QUEST: No --
[16:55:00] SIEGEL: No, listen, let me finish. There`s this blind optimism and arrogance of Silicon Valley that we are seeing over the last year has
been absolutely destroyed as people understand the impact.
You know, one thing he said during that call, he said the vast majority of a data you chose to -- you know, you choose to share it. But all of us can
come back and say, but you gave open settings and we had no idea what was happening --
QUEST: Right --
SIEGEL: With that.
QUEST: Interesting, and of course, we have time to go to the testimony that he`s going to be giving -- was going to be --
SIEGEL: Yes --
QUEST: Testifying on Capitol, but of course, thank you.
SIEGEL: Thank you too.
QUEST: Now, we will take a profitable moment after the break. This is QUEST MEANS BUSINESS from New York.
(COMMERCIAL BREAK)
QUEST: So Mark Zuckerberg is talking about leadership. Tonight`s profitable moment, who are the great CEOs? Well, those who run companies that others
have built, they tend to be great leaders.
Dick Parsons who turned this company around after a major crisis, then you`ve got those who started their own company. Steve Jobs, you`ve got Tony
Fernandes of Air Asia facing a major crisis after a plane crash.
He rose to the occasion, walked out in front of the press and said I am to take responsibility. Alan Mulally who went from Boeing to Ford, turned it
around, a leader of a different type, but what they all have is an innate quality to lead from the front, to show that they`re in charge, to show
that they are transparent and to say I am responsible.
Mark Zuckerberg is saying it, but we question whether he believes it. The next few weeks will be the grind and the stone that proves the metal of the
man as a leader. And that`s QUEST MEANS BUSINESS for tonight, I am Richard Quest in New York.
Whatever you`re up to in the hours ahead, I hope it`s profitable -- yes, we will do it again tomorrow.
END
