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Quest Means Business
A New Wave Of Coronavirus Cases Has Investors Worldwide Reaching For The Sell Button; Steve Mnuchin Says We Can't Shut Down The U.S. Economy Again; Airline Stocks Pummel As Market Falls Sharply; Global Markets Sink Amid Reviewed Coronavirus Fears; Mexican Medics Say They Lack Adequate Protective Equipment; Beauty Brands At Forefront Of Supporting Black Lives Matter; Moderna, Johnson And Johnson Advance Human Vaccine Trials In U.S.; U.S. Markets Fall Sharply On Fears Of Second Wave Of COVID-19. Aired 3-4p ET
Aired June 11, 2020 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:24]
ZAIN ASHER, CNN HOST: What a day. It is the final hour of trading on Wall Street. Let's look at U.S. markets. The Dow is down 1,700 points. It is on
pace for the worst day since March. What a day.
Those are the markets, and these are the reasons why.
A new wave of coronavirus cases has investors worldwide reaching for the sell button. Steve Mnuchin says the U.S. economy can't shut down again, no
matter how bad things get. Those are the words from the U.S. Treasury Secretary.
And Heathrow is blaming the U.K. government for a new round of job cuts. I'll speak to the head of IATA on that.
Live from New York. It is Thursday, June 11th. I'm Zain Asher and this is QUEST MEANS BUSINESS.
All right. Welcome, everyone. We begin with a sobering reality in terms of what is happening with the U.S. markets right now. Let's look here. The Dow
is down more than six percent. The Dow is down 1,700 points, plus, the optimism of a quick economic recovery is now waning.
And let me explain why. The fear of a second wave of coronavirus is taking hold. And as the U.S. economy reopens, new cases are being reported daily.
Another 1.5 million Americans filed for unemployment last week. That's 44 million people since way back in mid-March. And finally, uncertainty of a
stimulus, and the U.S. Presidential Election.
I want to bring in Alicia Levine, she is joining us live now from New York. She is the Chief Strategist at BNY Melon Investment Management. Alicia,
thanks so much for being with us.
So, when you looks at what is happening with the markets right now, is this proof that the stock market was unfortunately a little bit too optimistic
since the beginning of this pandemic? It always sort of seemed to have one foot out of reality, and now I guess it is starting to wake up.
ALICIA LEVINE, CHIEF STRATEGIST, BNY MELON INVESTMENT MANAGEMENT: Hi, Zain. It is great to see you. Look, the move off the bottom was historic.
It was 43 percent up from the lows, and the speed at which that happened, has actually never happened before.
And in the way we came down so quickly in February and March, we retraced it pretty quickly as well. You know, when it feels easy to pick a stock and
it goes up, that's kind of a signal that things are getting frothy.
And certainly, in the last couple of weeks, it felt that way. However, for the most part, the rally has been in the non-cyclicals, meaning in the tech
stocks, in healthcare, in large box retailers. And these are the kinds of companies that are actually having their prospects improved by the
shutdown.
So, it wasn't entirely crazy.
ASHER: Okay. But just in terms of what sort of recovery we are going to be seeing, I am sure you'll remember some people early on were talking about
the possibility of a V-shaped recovery, as in things get really, really bad and then they get better.
And now, when you think about the rising cases in certain states across the south, are we anticipating more of a W sort of shaped recovery where things
get better again and then worse again, and then finally get better?
LEVINE: Yes, so, look, economists have an alphabet soup here on how to think about the recovery. What Jay Powell described yesterday was
essentially a soft V, an asymmetrical V.
So you come down quickly and then it takes you two and a half years to really recover to where you were before, and that's slower than what the
market has been pricing in.
The market has been pricing in a pretty nice, quick recovery. However, let me say this, the market is a forward-looking mechanism, and we think the
direction of travel is upward. That doesn't mean you can't retrace some of the move here, and it doesn't mean you can have a consolidation.
Some of the uncertainties you talked about -- will we have fiscal? Will we have more cases for certain shutdowns around the country? That's all the
uncertainty out there.
But the basic message is that the direction of travel is upward and so the market will anticipate that and price that in.
ASHER: Yes, I think that despite some of the market fears, there are clearly some bright spots. There's the fact that we have got accommodative
monetary policy. There is also the fact that the unemployment rate overall that we got on Friday ticked down slightly.
The weekly jobless claims are falling. Actually, Mastercard came out and said that in May spending was actually quite similar to pre-pandemic
levels. So there is a lot to be -- I get what you are saying is that there is a lot to be hopeful for despite some of the negative news we are seeing.
[15:05:06]
LEVINE: Yes. That's right. Look, the market trades on rates of change, and the rate of change is positive here. You can't get worse than the worst
ever. So it is getting better from that.
I think many of us who have watched markets from years were shocked that there was no retracement over the last ten weeks. You know, it was almost a
straight shot up without any kind of consolidation.
So, it is healthy to have this here. But there will bumps and fits and starts. I am not entirely concerned about the new cases as it comes to the
economy only because I think the bar to shutting down again in different region is extraordinarily high.
I don't think we are going to do that again unless the healthcare system gets overwhelmed, and so far, we are not there yet. And so for the most
part the direction of travel is upward.
ASHER: Right.
LEVINE: I'd say this to investors, you know, in the end, you should be exposed to the non-cyclicals and to the tech stocks, which are really the
direction of the economy here.
ASHER: All right, Alicia Levine, thank you so much. Appreciate it.
All right. Despite cases of the virus rising across several states, the Treasury Secretary Steve Mnuchin told CNBC that the U.S. cannot come, as
our guest was just talking about, cannot come to a screeching halt again. Take a listen.
(BEGIN AUDIO CLIP)
STEVEN MNUCHIN, U.S. TREASURY SECRETARY: We can't shut down the economy again. I think we have learned that if you shut down the economy, you are
going to create more damage, and not just economic damage, but there are other areas. And we have talked about this, of medical problems, and
everything else that get put on hold.
I think it was very prudent what the President did. But I think we have learned a lot, and I also would just say the fact that Congress, the House,
the Senate responded with the administration in an unprecedented way to put $3 trillion in the economy --
(END AUDIO CLIP)
ASHER: Secretary Mnuchin went on to say that only $1.6 trillion are in the economy right now. So another trillion dollars will be pumped in over the
next month, and we are joined now by Stephanie Kelton, an Economics and Public Policy Professor at Stony Brook University.
She is currently advising Democrat Joe Biden's U.S. Presidential campaign, and she is also author of "The Deficit Myth."
Stephanie, thank so much for being with us. So just overall, just putting Steve Mnuchin's comments just there aside for one second. Overall, looking
at this sort of holistically since March, what do you make of the government response economically to this crisis? Has it been adequate? Has
it been sufficient?
STEPHANIE KELTON, ECONOMICS AND PUBLIC POLICY PROFESSOR, STONY BROOK UNIVERSITY: No, it hasn't. I think the evidence of that is that, you know,
we have seen more than 30 million people lose their jobs.
And so while I think the Federal government's response was in many ways trying to do the right thing, we had a policy attempt to keep people
attached to their jobs, to keep workers attached to their jobs and on payroll.
In other words, the mass job losses could have been avoided if the government's small business administration lending program and the PPP, the
Payroll Protection Program had gone off without a hitch. The difficulty is of course that it didn't go off without a hitch.
And you know, the inability to sort of roll that out very, very efficiently allowed a lot of people to lose their jobs.
ASHER: Okay. So just in terms of going forward then -- you've talked about some of the mistakes made so far, but going forward, what is the right
strategy do you think to speed up the economic recovery?
KELTON: Yes, so the largest piece of legislation we have had -- there have been four that have made it through both the House and the Senate and to
the President's desk.
The biggest one we had was called the CARES Act and that was a little over $2 trillion that's what we just heard Secretary Mnuchin talking about. That
money is making its way into people's pockets and into the economy.
The House has stepped forward with another Spending Bill. They passed a trillion dollar Bill, but the Senate has thus far shown no interest in
taking it up and passing it out of the Senate.
And so, you know, there is an appetite to do more, at least on the house side. And I think that, you know, what I am sensing from Secretary Mnuchin
is that the Republicans do understand that the economy is not going to stand on its own, that something more is going to have to be done.
And I think one of the most important things the Federal government needs to do next is to get money to state and local governments, which are
absolutely getting clobbered. They are laying off millions of state and local government employees. They are begging the Federal government for
help.
And I think that if that help doesn't materialize quickly, we are looking at another million, million and a half public sector jobs being lost across
the country.
The last thing we want is, you know, governors, 50 little Herbert Hoovers stepping on the gas pedal, slashing spending, laying off workers at the
same time that Congress is trying to do something to help recover and restore jobs in this country.
[15:10:07]
ASHER: So, you are saying the government needs to do more to help individual states.
When you look at, though, the deficit right now, the deficit has actually widened to $1.8 trillion over the past eight months. In your opinion, are
there any limits as to how much debt a government should incur at a time like this to keep propping the economy up?
KELTON: Well, I don't really think of it in terms of a limit to the debt. I think of it in terms of how much fiscal support the economy needs.
And so we can see just by virtue of the tens of millions of people who are without jobs that the economy can handle a lot more fiscal support. In
fact, it needs much more fiscal support.
So you know, the deficit is going to be a reflection to the large extent of conditions in the real economy. The worst the real economy is doing, the
larger the deficit will grow on its own, even without action from the Federal government because we have automatic stabilizers.
So, when the economy is weak and people lose jobs, they qualify for a whole range of programs that are designed to kick in automatically, to provide
higher spending to support a weak economy.
And of course, tax revenues fall off a cliff when the economy is weak. So, the deficit will increase on its own whether Congress acts or not.
But I would call that the ugly way to increase the deficit. The better way is to do it proactively, to do it strategically, and to get money targeted
into the hands of the unemployed in to the small businesses that are struggling to survive.
And so targeted use of the deficit at this moment is exactly the right thing and the economy will tell us when it begins to be enough spending.
ASHER: All right, so how they spend money is key. Stephanie Kelton live for us there. Thank you so much. Appreciate it.
KELTON: Thank you.
ASHER: All right, nearly 20 million people in the U.S. work force state or local government -- during the coronavirus pandemic more than 1.5 million
of them have actually lost their jobs. Now, deeper budget cuts could be on the way. CNN's Vanessa Yurkevich reports.
(BEGIN VIDEOTAPE)
VANESSA YURKEVICH, CNN BUSINESS AND POLITICS REPORTER (voice over): For a quarter century, Jenny Guberman has dedicated her life to teaching children
with special needs.
(BEGIN VIDEO CLIP)
JENNY GUBERMAN, SPECIAL NEEDS TEACHER: I feel my role is imperative. We have we are a family.
(END VIDEO CLIP)
YURKEVICH (voice over): In March, Lawrence Middle School shut down due to COVID-19 and Guberman started teaching classes online, but then she was
unexpectedly laid off, filing for unemployment for the first time at 53.
(BEGIN VIDEO CLIP)
GUBERMAN: The rug was pulled out from under me April 30th when this all happened and in the midst of a pandemic, three million people were looking
for health insurance and I was one of them.
(END VIDEO CLIP)
YURKEVICH: Guberman is one of about 100 public educators laid off from Lawrence School District in New York due to COVID-19 and they are not
alone. State and local governments cut 571,000 jobs in May after losing nearly one million in April and it is only going to get worse.
(BEGIN VIDEO CLIP)
MARK ZANDI, CHIEF ECONOMIST, MOODY'S ANALYSTICS: The state and local governments are hemorrhaging red ink. The COVID crisis has crushed economic
activity and thus, tax revenue. So, with all of that red ink, they have no choice but to start cutting.
The state and local governments are going to shed about three million jobs.
(END VIDEO CLIP)
YURKEVICH: House Democrats approved a bill that would include $90 billion for K-12 cools and higher education, hardest hit by job cuts. The Senate
has yet to take it up, and it's not just public educators at risk.
(BEGIN VIDEO CLIP)
ZANDI: These are jobs we need. Teachers, fire, police, emergency responders, people who work in hospitals, social workers. You know? These
are the kinds of jobs you need in a pandemic in an economic crisis.
(END VIDEO CLIP)
YURKEVICH: Henry Garrido leads the largest public worker union in New York City with 150,000 members. And 150 have died fighting on the front lines of
COVID-19.
(BEGIN VIDEO CLIP)
HENRY GARRIDO, EXECUTIVE DIRECTOR, DISTRICT COUNCIL 37 UNION: The biggest irony is that, you know, for the first time in a long time, workers have
been recognized for what they are, which is everyday heroes.
People who come to work every day, who sacrifice their lives, their safety for the sake of others, for saving others, are now on the brink of being
laid off.
(END VIDEO CLIP)
YURKEVICH: At the end of this month, most states will decide their fiscal budgets for next year. But with so many in the red and without help, more
jobs will be cut.
(BEGIN VIDEO CLIP)
GARRIDO: The budget is likely to be a very draconian budget that cuts essential workers to the core. Many of them will not have a job and that's
a travesty because we are expecting COVID-19 to come back a second time. This is a ticking time bomb for essential workers.
(END VIDEOTAPE)
YURKEVICH (on camera): Now, these essential workers also include people who are helping Americans apply for food stamps and Medicaid, badly needed
social services right now during this pandemic.
And the growing concern is that if a second wave of the virus hits the United States and there are cuts to the public healthcare sector, the
system simply would not be able to handle that many new cases.
That's why it is so critical that the Federal government provides some financial assistance to state and local governments in order to save these
jobs -- Zain.
ASHER: Vanessa Yurkevich there.
The tourism industry has been among the hardest hit by the coronavirus pandemic, but the damage may continue to add up according to some grim
projections on the outbreak's trajectory. That's next.
(COMMERCIAL BREAK)
ASHER: Wall Street is seeing steep losses Thursday with airline stocks among the worst affected. Industry giants like Delta, United and American
are all posting losses in the double digits.
Delta there down 14 percent. American airlines down 15 percent. The fear is that even when there is a recovery and even when things get back to normal,
airlines will take even longer for things to see normalcy again.
The U.K.'s largest airport is cutting jobs as a grim picture emerges for the British tourism industry. London Heathrow says their passenger numbers
hit an all-time low in May, and the U.K.'s plan for a mandatory 14-day quarantine for international arrivals stands to compound its losses as
well.
Alexandre de Juniac is the Chief Executive of the International Air Transport Association. He joins us live now from Geneva.
Alexandre, thank you so much for being with us. So, if travel is at a record low, how are airports like Heathrow for example supposed to cope
with those losses without resorting to mass lay layoffs?
ALEXANDRE DE JUNIAC, CHIEF EXECUTIVE, INTERNATIONAL AIR TRANSPORT ASSOCIATION: We see the oil industry has been severely hit. It is an
unprecedented crisis for us, so the airlines first. But also the aircraft manufacturers, the OEMs, and of course the airports as well will be after
that, and the infrastructure we are advocating in favor of the whole industry for government to implement in the support packages and financial
relief plans, and up to now, it has been pretty successful.
Many governments have announced significant support plans, and part of it should go to every actor in the industry, including the airports. So,
that's how we think government should help the sector cope with these difficulties and to bridge the gap between now and the future recovery that
should happen.
[15:20:24]
ASHER: I want to talk about airlines slightly because British Airways, EasyJet and Ryanair are all planning to file lawsuits against the U.K.
government because of these quarantine rules. This idea that outside travelers actually have to self-isolate if they get to the U.K. for 14 days
at least.
How can ordinary U.K. residents be assured that the airline industry is actually prioritizing safety at this point and not just profits, not just
getting things back to normal?
DE JUNIAC: First of all, I may remind you of our first priority ever, as always, it will be safety. In this COVID-19 crisis, health safety is an
integral part of our safety priority, so as usual.
Secondly, we have with the W.H.O., with medical specialists and under responsibility of ICAO, the International Civil Aviation Organization, we
have set up a plan, a process for both control and sanitary check and control of passengers that should be implemented everywhere and that should
guarantee minimal risk of transmission either on board or from one country to another.
So, it is something that we advocate in favor of -- to be applicable everywhere, unanimously, in a normalized fashion, to allow our industry to
restart without compromising safety, which has always been, which will always be our top priority.
So, passengers that trust us, they should continue.
ASHER: You know, in the United States we are actually seeing -- just based on what you are saying, we are seeing some of the consequences trying to
trying to get things back to normal too quickly. I am sure you have read several states here are reporting a spike and a rise in coronavirus cases
and there are very sort of strong fears about a second wave in terms of this pandemic.
Based on that, isn't it better to accept the quarantine rules and play it safe rather than being sorry later down the road?
DE JUNIAC: You know, the point is the following. We think that if we implement this sanitary check and health control measures, we guarantee a
very high level of safety, and this high level of safety is absolutely key to remove measures such as quarantine.
So, we say quarantine is useless, but provided, you implement the processes that have been agreed with again, all of the actors of the industry,
medical specialists, the contribution of the W.H.O. so we are pretty confident about, you know, the safety and the minimal risk of this process.
ASHER: Alexandre de Juniac, thank you so much for sharing your point of view. Appreciate it.
The travel industry is not the only one hurting right now. Retail was already suffering from the impacts of the pandemic, and Japan's richest man
says the current discord in America is causing profound damage as well.
Kaori Enjoji has this exclusive interview.
(BEGIN VIDEOTAPE)
KAORI ENJOJI, JOURNALIST: Fast Retailing reopened its flagship store in Tokyo before Japan lifted the state of emergency. It is the kind of move
founder and CEO, Tadashi Yanai relishes despite the toughest times he is facing in years.
(BEGIN VIDEO CLIP)
TADASHI YANAI, CEO, FAST RETAILING (through translator): If we kept our stores closed, the whole city will die. Not a single employee has been
infected. I was confident we could do it. Someone needs to have the courage to go first.
(END VIDEO CLIP)
ENJOJI (voice over): But then more problems hit.
(BEGIN VIDEO CLIP)
YANAI (through translator): It shows just how devastated the U.S. split is. The whole situation is untenable. It is not working. They should have
thought about what would occur if something like that happened after a long period of keeping everyone locked in. The very image of America is
breaking.
(END VIDEO CLIP)
ENJOJI (voice over): The blow could dent Asia's fragile textile industry further, he says, which has already been crushed by falling orders.
(BEGIN VIDEO CLIP)
YANAI (through translator): The same is for garment factory workers in China are on par with other industries and their facilities are state-of-
the-art. Other developing nations need to develop that same kind of infrastructure. It's not just one factory's problem.
(END VIDEO CLIP)
[15:25:19]
ENJOJI (voice over): Fast Retailing has cut earnings twice this year, but it is flush with cash. I asked Yanai if he is looking to buy a brand that
may be struggling to stay afloat?
(BEGIN VIDEO CLIP)
YANAI (through translator): Absolutely not. Nothing new will come out from buying a failed brand. In secondary in Shenzhen, industries buyout with the
sole purpose of testing out ask. That's just like peeking through the carcass.
(END VIDEO CLIP)
ENJOJI (on camera): He is pouring millions of dollars into AI and robotics, and he says in the future, technology plus fashion instinct will
determine what customers really want.
From Tokyo, I am Kaori Enjoji.
(END VIDEOTAPE)
ASHER: All right, still ahead, they rushed to help others risking their own lives -- how some paramedics in Mexico are paying the ultimate price
during the coronavirus pandemic.
(COMMERCIAL BREAK)
ASHER: Hi, everyone. I'm Zain Asher. There is more QUEST MEANS BUSINESS in a moment when the founders of Sundial brands, we will discuss the Black
Lives Movement and inequality in the Board room as well.
And some drug giants are pulling ahead in the search for a COVID vaccine. I'll be joined by a top vaccine expert from Johns Hopkins University.
Before that though, this is CNN and on this network, the facts of course, always come first.
A U.S. General is apologizing for appearing in a photo op with President Trump last night after protesters had been forcibly cleared from the area.
[15:29:53]
ASHER: General Mark Milley wore combat fatigues while walking from the White House to a church. He says it was mistakenly -- in mistakenly gave
the impression of military involvement in domestic politics.
And coronavirus cases are on the rise in the U.S. as the total number of infections eclipses 2 million since Memorial Day. In late May,
hospitalizations have increased in, at least, a dozen states. And an influential model previously cited by the White House projects a steep
increase in deaths by the fall.
Tunisian authority say nearly 50 people are dead after the boat carrying them sank off the coast of Tunisia earlier this week. An official says the
passengers were migrants, largely from sub-Saharan Africa, who were bound for Italy. Recovery operations are still underway.
Syrian President Bashar al-Assad has removed to the prime minister and appointed a replacement by decree. State media did not give a specific
reason, the regime loyalists had called for the prime minister's ouster amid an economic crisis and the collapse of the Syrian lira.
All right, we are last -- now in the last 30 minutes of trading. Global markets falling as coronavirus cases rise around the world. Take a look at
that on your screen, we're seeing a sea of red. The U.S. markets' Dow, in particular, is down about 1800 points or so. Europe and Asia all close
sharply lower as well.
I want to bring in CNN business correspondent Clare Sebastian. So, Clare, the markets up until this point, during the pandemic have had a pretty sort
of surprisingly good run. But I guess the party was always going to end sooner or later. Why is the market so surprised by this latest round in
terms of new cases coming out of certain states in the south?
CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes, and I think the good question and one that I've been putting to several analysts today is why
today? Because a lot of what we're seeing isn't necessarily news. We knew that perhaps when states started to reopen we might see a rise in cases.
And the things that Jerome Powell, the Fed chair said last night, although, he said it in a very somber way, also were not news. It would have been
apparent to many who had looked to the economic data that this was going to be a prolonged recovery.
But I think if you look at how stocks have fared over the past couple of months, we saw about 4-1/2 percent added to the S&P 500 over the course of
May. Then, over the first five trading sessions in June up until the end of this Monday, another six percent was added. So, the rally was really
accelerating.
One analyst told me that a lot of institutional investors who had missed out on the first bit were sort of panic buying. And I think what we're
seeing now in some ways as some of the -- that frost coming off the top. That the last people in and now the first people coming out, and that's why
you see increasing momentum in this sell-off that the people who are now taking losses are growing in numbers.
ASHER: Did we get a good sense from Fed Chair Jerome Powell yesterday about just how prolonged and painful this recovery might potentially end up
being?
SEBASTIAN: Well, I mean I think it was telling he said that rates will remain pretty -- well, this is according to the (INAUDIBLE) at the rates
will remain where they are pretty much through the entirety of 2021, perhaps into 2022 as well.
The fed chair is clearly very worried about something that he's actually been very sort of celebratory about over the past few years, which is that
the very long recovery that we saw in the lead-up to this had brought in marginal groups into the jobs market.
He is very worried now that they are not only the first to lose their jobs in this pandemic, that some of those jobs may not come back. That we may be
looking at a very long period of time before the jobs market returns to the kinds of levels that we saw in January.
So, he painted a pretty bleak picture, and he said that the rates will remain low, Q.E. will stick around, and some of the emergency measures will
also remain in place for the foreseeable futures.
And given that, I think it's a bit of a paradox in a way that we're seeing this sell-off in the markets because the markets would be buying up until
this point on the, the, the, the -- that support that's been stated from the Federal Reserve. And he pretty much said that's going to continue for a
long time coming.
So, I think you can only assume that some of this has to do with questions around the valuations that we're seeing in the markets today.
ASHER: Clare Sebastian, live for us there. Thank you so much.
That's the American stocks also falling sharply as well as the region hit a troubling milestone in the coronavirus pandemic. It is now reporting more
than 70,000 deaths. Brazil accounts for more than half of that number alone. Mexico is also among the hardest-hit countries as well.
And as our Matt Rivers' reports, some paramedics there are sacrificing their own lives to save others.
(BEGIN VIDEOTAPE)
MATT RIVERS, CNN INTERNATIONAL CORRESPONDENT: They chant his name and the sirens wail.
This is a tribute to Dr. Miguel Angel Perez Alvarado, a doctor who worked in a public ambulance in Mexico City. He died last month of COVID-19. For
weeks, the father of three girls treated patients with the virus.
[15:35:02]
RIVERS: He was worried, his wife, Nancy, tells us. Because he knew his working conditions weren't safe.
Dr. Perez told her he wasn't given the right protective equipment on the job and he's not alone. Seven paramedics and a doctor who work in public
ambulances told us the same thing.
Here, one demonstrates how water can be sprayed through the coveralls they've been given. Duct tape is now important, they use it to patch holes
in their suits and to tape garbage bags to try and isolate COVID cases inside their ambulances.
Speaking anonymously for fear of losing his job, this paramedic says he and his colleagues had to buy their own safety equipment.
He says they are sending us into a war with nothing. You don't send a firefighter to a fire without protection.
So, this is the mask that the paramedic we're speaking to says the government issued him and you don't need to be a medical expert to
understand that this does not give him the kind of protection he needs.
The paramedics we spoke to work for two sections of Mexico's health ministry. Both sections said all their paramedics have the required
supplies -- statements that seemed to be demonstrably untrue. Especially when you see how it's supposed to be done.
We spent the night recently with a Red Cross ambulance crew -- private volunteers who have all the right equipment and even designated COVID
units. And that's a necessity because the worst of Mexico's epidemic is happening right now.
On a 12-hour shift, there were 12 COVID calls. And sometimes, we were too late.
RIVERS: So, we got this call a little over 20 minutes ago now. And we just arrived on scene. And in that time, the 43-year-old female victim had
already died of symptoms consistent with COVID-19.
And arriving with patients still alive didn't always matter in the end. 72- year-old Maria Isabel Cruz Hernandez was taken from her apartment and brought straight to the hospital. Her son told us she has since passed
away.
After each exhausting call, trucks, and paramedics are both sprayed head to toe with a special disinfectant. Paramedics and government-run units say
they try and disinfect too once again, with supplies they bought themselves.
Are you scared? We ask.
Always, he says. You don't sleep. Scared for myself, scared of infecting my family, and scared of ending up like Dr. Perez.
Two days after he went to the hospital, he texted a final message to his wife.
He said, be careful, I love you all. That was last time we spoke. Eight days later, Dr. Perez passed away.
Matt Rivers, CNN, Mexico City.
(END VIDEOTAPE)
ASHER: Black Lives Matter is calling out racism wherever it is found, leading to big retailers in the United States to change their ways. We'll
explain after the break.
(COMMERCIAL BREAK)
[15:40:27]
ASHER: Major corporations are making moves to curb racism in retail. Walmart says they will no longer lock up African American beauty care
products behind glass cases. Critics on the practice said, implied black people are more likely to shoplift.
Meantime, Sephora is the first retailer to sign the 15 percent pledge. It is a promise to use at least 15 percent of its shelf space to sell products
from black-owned businesses. Currently, only seven out of the 290 brands Sephora sells are black-owned.
Richelieu Dennis is the founder and chair of Essence Ventures. He's also the founder of Sundial Brands and the New Voice Fund, which support --
supports black female entrepreneurs. He joins us live now.
Richelieu, thank you so much for being with us. So, Sephora says it's going to dedicate 15 percent of its shelf space to black-owned businesses. What
are your thoughts on that? Is that a good first step or should more be done?
RICHELIEU DENNIS, FOUNDER, ESSENCE VENTURES: Well, I think it's a good first step. But certainly, more should be done because it's not just a
matter of dedicating your shelf space, it's making sure that the brands have an opportunity to be successful on the shelf.
It's also making sure that the brands have the resources to set them up for success before they ever get on the shelves. So, so, I think it's a great
first step, and I think it's -- first of all, it's about time, and it is a great first step. But we have a lot more work to do other than sort of
announcing that we're going to -- we're going to have 15 percent of the brands on the shelf.
Now, we have to do the real work of making sure that those brands are successful when they get in store and that they are -- they are sustainable
on the shelf and that it can drive real value for the -- for the founders and the companies that are -- that are bringing these brands forward.
ASHER: All right. So, we should -- we should lure them, at least, for taking the step in the right direction. But I want to let our viewers know
one statistic that I found that I'm sure you're familiar with.
In 2018, only one percent of venture capital dollars went to black startup founders. Only one percent. Now, I have my theories as to why I think that
is, but I'm going to let you take over and tell me your thoughts on that.
DENNIS: Yes, I mean, I think -- I think it's now -- it's wonderful that now, people are starting to understand these facts and realizing these
inequities. My thought was, you know, from having built a brand, especially in the beauty business that fought for me, it took us 16 years to get on a
-- on a retail shelf because we felt that the systems and structures that we're set up were set up and errantly to see us fail.
And so, that is -- that is sort of the same sort of approach this systemic racist structures that while companies and brands may not realize exists or
may not do unintentionally, because of biases get set up in ways that make it difficult for our brands to be seen, and one of them is funding and
capital.
And so, what we ended up doing was launching the New Voices Fund, which is $100 million fund to invest in black women entrepreneurs. And so, we've
done that over the past three years and we've seen tremendous success in all of these brands, or many other brands today that you're seeing on
shelf, that stay on shelf, and that scale and the grow are coming out of -- coming out of the New Voices Fund's brands like (INAUDIBLE), and Lip Bar,
and Honey Pot.
And so, so, the reason though I think was the capital structures were not only set up to discriminate against men, but they were particularly set men
of color, they were particularly set up to discriminate against women of color.
And so, many of those ideas are now being called to question, and now being called the task. And so, you're seeing a lot of reflection and correction
starting to happen, but it's still early days. We've got a long way to go, we've got -- we've got a lot of work to do.
ASHER: Right.
DENNIS: But, the fact to the matter is that, when given the opportunity, brands like Shea Moisture before them, and brands like Honey Pot, and Lip
Bar, and some of these other brands are proving that they cannot just get on the shelf, that they cannot just stay on the shelf, but that they can
take these investments from V.C. firms and deliver outsized returns.
[15:45:12]
ASHER: Now, you know, I actually just hope that with all the attention we're seeing on this issue because of the Black Lives Matter movement and
the protests. And the changes are actually going to be long-term and not just short-term while the spotlight is on these corporations.
But Richelieu Dennis, we have to leave it there. I just ran out of time. I'm so sorry. But thank you so much. Appreciate it. I hope you're safe and
well.
DENNIS: (INAUDIBLE)
ASHER: Thank you.
All right, a new report from the U.N. finds the world's clean energy capacity grew at a record pace of 2019. Now, the coronavirus pandemic has
halted progress in the sector at a time when scientists say it is needed most.
John Defterios has more in this edition of the "GLOBAL ENERGY CHALLENGE".
(BEGIN VIDEOTAPE)
JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: Over the past decade, solar and wind power have seen substantial growth. Last year, renewables
accounted for 72 percent of all new power expansion, according to the International Renewable Energy Agency.
Now, in the midst of the coronavirus pandemic, the sector is facing a major slump. Growth and newly commissioned solar and wind projects have stalled.
With factory shut, getting access to parts is a challenge. Social distancing and lockdowns are impacting the residential solar rooftop
business.
And according to analysis of U.S. unemployment data, 600,000 jobs have already been lost in the clean energy sector.
DAN SHREVE, HEAD OF GLOBAL WIND ENERGY RESEARCH, WOOD MACKENZIE: Well, the global impact has been wide-ranging for wind and for solar installations.
Most notably in Q1, China was hit the hardest by the coronavirus, so we're expecting something on the order of 10 to 15 percent reduction and total
installation activity in China.
India like (INAUDIBLE) demand is expected to fall there as well. The United States is fared a little bit better. We're not expecting substantial dip in
installations.
DEFTERIOS: There is concern that any delays will slow the transition to cleaner energy. A transition that scientists say is not moving quickly
enough to curtail climate change. As governments scramble to boost economic growth, there are calls for renewables to be at the center of any recovery.
FRANCESCO LA CAMERA, DIRECTOR GENERAL, INTERNATIONAL RENEWABLE ENERGY AGENCY: The oil world was based on a centralized system with oil and coal
as the main vector. Now, we have to build another world. The impact of the COVID in our life has made clear to everyone that we have to build a
future. It is more resilient to shocks and they will -- this will -- is bringing us to renewables, because they have demonstrated, as I told you,
to be the most resilient way to produce energy.
DEFTERIOS: An energy source that's suffering from its first and new decline in 20 years. But one that is expected to return to growth next year,
especially if governments implement a clean energy recovery.
John Defterios, CNN.
(END VIDEOTAPE)
(COMMERCIAL BREAK)
[15:50:17]
ASHER: The U.S. is taking major steps in the global race to develop a COVID-19 vaccine. Moderna has announced it will conduct its final stage of
testing next month with 30,000 volunteers.
Meantime, Johnson and Johnson has moved up its first human trials from September to July with a little over 1,000 volunteers on board.
Dr. Bill Moss is executive director of the International Vaccine Access Center at Johns Hopkins University. He joins us live now from Baltimore,
Maryland.
Bill, thank you so much for being with us. So, just in terms of this Moderna vaccine that is in the works, what do we know about phase -- the
phase one of this clinical trial in terms of how patients have responded so far?
DR. BILL MOSS, EXECUTIVE DIRECTOR, INTERNATIONAL VACCINE ACCESS CENTER, JOHNS HOPKINS UNIVERSITY: Yes. So, this is an important milestone --
important to understand very early this process. What we learned from phase one is that the vaccine is shows safety in small numbers of individuals.
These were healthy individuals who were enrolled in the phase one trials.
It gave us some sense about the dose, and Moderna has selected the middle dose to go forward into these phase three trials. And also, it's given us a
clue about the -- what we say the immunogenicity of the vaccine.
Do's that people of immune response that we think is protective. But what the phase one and currently that vaccine is in phase two, which is a
slightly larger study, several hundred where we -- Moderna will again assess the safety and look at the vaccine responses in different types of
individuals, not just healthy young individuals.
But this next step into phase three, as you mentioned, into 30,000 individuals is really the critical part because this is where we begin to
see whether the vaccine actually protects against disease.
Their primary outcome is be going to be whether the vaccine protects against symptomatic disease, whether people get any symptoms from the
disease, but they'll also be looking at whether this vaccine induces sterilizing immunity. That means that it protects and prevents infection
itself, and they will be looking at to see whether this vaccine prevents severe disease, whether people will need to actually get the disease will
be hospitalized.
But I see this again it's just one of the early steps, this is the development and testing stage of the vaccine, but we'll still need to
assess the manufacturing capacity, the deployment and the supply chain, and general acceptance of the vaccine going forward.
ASHER: So, assuming that everything pans out and, you know, Moderna wins the race, how does -- how does each government prioritize it in every
country who ends up getting the vaccine first?
MOSS: Yes, this is -- it's a very difficult challenging question that the world is going to face in the very new future -- in near future. First of
all, we probably won't just have one winner, will -- we want to have multiple winners. We want to have multiple winners in different countries
that will increase the access globally.
But it's going to be a really difficult decision for countries, and particularly, vaccines coming out of these public-private partnerships. For
example, between the U.S. government and Moderna, how is that vaccine going to be used?
Hopefully, there'll be some really serious deliberate -- deliberations around who the priority individuals. We're not going to have a vaccine for
everyone right away. So, we're going to need to prioritize which countries get the vaccine, and then, within each country which individuals get the
vaccines.
And hopefully, those are going to be the individuals who are at high risk of infection, and particularly, those who are most vulnerable.
ASHER: So, perhaps, the elderly and people with underlying conditions as well. All right, Bill Moss, we have to leave it there. Thank you so much.
MOSS: Thank you.
ASHER: You're welcome.
The sell-off in the U.S. market is intensifying in the final hour. Let's take a look actually. The Dow is actually down -- I'd see almost seven
percent, 1,800 points. That is what the Dow is doing right now.
Oil interestingly has recovered some of its losses, it was actually down more than seven percent earlier into the day as recovered though.
Matt Egan joins us live now from New York. So, Matt, here is the thing, when states -- when certain states here in the U.S. were talking about
reopening, I think a lot of experts anticipated that there would be suddenly arise in the number of cases.
ASHER: What is it about today that has really caught the market off guard?
[15:55:09]
MATT EGAN, CNN BUSINESS LEAD WRITER: Well, Zain, I think that while a lot of the medical experts were anticipating a rise of infections, the stock
market clearly was not. I mean, the market had begun to resemble a runaway train.
The S&P 500 was up as much as 44 percent from the March 23 lows of remarkable move. The NASDAQ was up even more and already taken out all-time
highs. The market was really pricing in perfection, pricing, and a v-shaped economic recovery.
So, what we've seen is that runaway train in the stock market has been derailed by a healthy dose of reality. There's been more than a dozen
states that have rising coronavirus hospitalizations since Memorial Day. There are signs that, that is starting to become a problem particularly in
the states that have reopened.
And listen, if there is a second wave, the market is totally unprepared for it. Valuations have gone up and it would totally ruin and undermine the
case -- the bolt case, which has been that the market will rapidly recover.
And Zain, the other thing is the unemployment situation is still pretty bad. I mean, yes, initial jobless plans have come down 10 weeks in a row
and that is encouraging. But they're still really elevated at 1.5 million in the last week. To give you some context, that's almost triple the
previous record high during the great recession.
So, the economy is still hurting and there is this risk that the coronavirus could hurt it even more.
ASHER: Matt Egan, thank you so much.
And that is QUEST MEANS BUSINESS. I'm Zain Asher in New York. The news continues right here on CNN.
(COMMERCIAL BREAK)
ANNOUNCER: This is CNN "BREAKING NEWS".
JAKE TAPPER, CNN HOST: Welcome to THE LEAD. I'm Jake Tapper, and we begin with the "BREAKING NEWS". The Dow Jones about to close in just a moment,
plummeting more than 1,800 points today.
Let's get right to CNN's Alison Kosik. Alison, this seems to be a dramatic end to stocks rallying in recent weeks. What's responsible for what
happened today?
[16:00:05]
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Jake, I think that investors broke up (INAUDIBLE) that helped those (INAUDIBLE) fears of the virus
impacting the economy again just as states are reopening and as new cases are rising in many states.
END
