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Quest Means Business

U.S. Stalling, Jobless Claims Rise For The First Time Since March; Senate G.O.P., White House Agree On Key Parts Of Next Aid Package; Beijing Says Accusations Of IP Theft Are Malicious Slander. Aired 3-4p ET

Aired July 23, 2020 - 15:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[15:00:32]

RICHARD QUEST, CNN BUSINESS ANCHOR, QUEST MEANS BUSINESS: The markets are under pressure as we enter the last hour, 60 minutes of trade on this

Thursday session. The Dow is down. Its off the session lows, but barely off the lows of the day and the broader and the techs, they are all down. If

you take the triple stock, and you see, the NASDAQ is off more than two percent.

The markets are down, and the reasons why. The U.S. Congress is talking about getting closer to a second major stimulus package, but it comes

though as weekly unemployment numbers show the economic recovery is going in the wrong direction.

China is now vowing to retaliate against the U.S. after the forced closure of the Houston consulate.

And Tesla, the share price roars on. It is set to join the S&P 500. It's had four straight quarters of profits.

Live from London on Thursday, it's July the 23rd. I am Richard Quest in the living room where I mean business.

Good evening, the U.S. economy is in deep trouble again having the thought that there had been some sort of recovery or resurgence, well, the latest

numbers give grave cause for concern.

Coronavirus is rampant in the U.S., some say it is out of control and that is forcing the economy in the wrong direction according to the latest

economic numbers that we're going to show you.

Look at the weekly jobless claims numbers. It comes out every Thursday, 1.4 million initial claims. Now, that's only 100,000 more than last week, but

it's the first increase in 16 weeks, and the thought had been that it might continue to fall.

So a small increase has a disproportionate worry. They are dashing the hopes of a quick V-shaped recovery. Stocks are falling fast. The NASDAQ as

you saw at the start of the program is down the most. It's down some two -- just over two and a third or two and a quarter percent.

The job losses that we are seeing because of the rampaging pandemic and the appearance that it's getting worse in the United States. Infections are

soaring 60,000 to 70,000 confirmed cases a day in the U.S., at the same time, the deaths are spiking as the states and cities shut down.

It's not only coronavirus numbers, look at other statistics. People have stopped or at least aren't flying as much as they were. T.S.A. numbers are

flat and that's been confirmed by airline earnings, which have staggering losses within them.

But they're not showing any -- there had been perhaps a scintilla, a breath, a glimmer of a recovery, but no. And restaurant bookings were

improving, now, they are leveling off, down 65 percent. Chipotle says the foot traffic has stagnated in July. Chipotle's CEO is going to be live with

us on this program.

Mark Zandi is with us, the Chief Economist at Moody's Analytics. Mark, where to begin? The recovery, such as it was nascent at best, seems to have

come to an end.

MARK ZANDI, CHIEF ECONOMIST, MOODY'S ANALYTICS: Yes, it sure does. You know, we opened the businesses here to quickly, it reignited the virus. The

pandemic is raging in many parts of the country. So governors in many states are now pulling back and pausing on the reopenings. That means less

hiring and layoffs are picking up again.

And I suspect that when we get the July jobs number, we're going to see a pretty sizable loss of jobs. So we had two months of job gains, May and

June, but that's all over and now some job losses and unemployment is going to head higher. We are a 12 percent unemployment rate already. It seems to

be going higher, so we are definitely moving in the wrong direction here.

QUEST: Now, you say that when it comes to a stimulus package, the Republicans are around about a trillion at the moment, but you say you need

$1.4 trillion to avoid a double dip, a double dip or a W-shaped outlook or recession. $1.4 trillion is a vast amount at this stage in the pandemic.

[15:05:21]

ZANDI: Yes, no. Yes, I don't think a trillion is going to cut it. $1.4 trillion is the minimum that would be necessary to avoid going back into

recession and that assumes that you get pretty good a package of support, you know, things like help for state and local governments that are

hemorrhaging red ink and cutting employment, more help for unemployed workers, more food assistance and other income support. You know, it has to

be the right kind of package.

So if I were King for the day, Richard, I would have a much bigger package, probably something closer to $2 trillion, and just for context, all of the

support so far provided by Congress and the administration comes to $2.4 trillion. So you know, we need a pretty big package to avoid recession, I

think at this point.

QUEST: Okay, but at this level, I mean, you're not showing any concern, as some are -- some economists and certainly some lawmakers about the size of

the deficit. You still believe that the economy is precarious enough that spend, spend, spend?

ZANDI: Well, I'm very concerned about deficits and debt, but I don't think we have a choice. You know, if we don't support the economy, we go back

into recession, our deficits and debt are going to be even larger.

So we have a Hobson's choice. You know, there's no good choice. The best of all the bad choices is to really step up here and make sure this economy

doesn't slip away in the face of this intensifying pandemic. We have really no options here.

QUEST: And you do say, just finally, that, if you don't -- if we don't get this, then your worry is the economy suffers more structural long term

damage. How far are we away from structural long term damage?

ZANDI: Well, it's already happening. I mean, we're seeing massive failures of small businesses and business bankruptcies. I mean, bankruptcies of

large companies are as high as they were at the peak of the financial crisis back a little over a decade ago.

So that structural damage is already occurring, and obviously, you mention the deficits and debt. It's another form of structural damage that we're

going to have to deal with on the other side of this pandemic at some point in time.

So it's already mounting, and it does mean that even when the pandemic is over, even when we get that vaccine, and it is adopted and widely

distributed, and we're off and running again, it's going to be a long time before we get back to something we all feel comfortable with.

QUEST: Mark, I'm always grateful that you give us time to torture us and give us your insight and experience. Thank you, sir.

On Capitol Hill, they are putting together stimulus package. At the heart of it of course is whether to renew or increase the $600.00 a week in extra

unemployment benefit that's been here since the early part of the pandemic.

It's due to expire at the end of the month and lawmakers are trying to agree on what more should look like. Well, some say it should be a

trillion, others say, it should be -- the Democrats wants it nearer $3 trillion. Steve Mnuchin says the goal is a 70 percent wage replacement.

(BEGIN VIDEO CLIP)

STEVEN MNUCHIN, U.S. TREASURY SECRETARY: The President's priority for the moment is to get money into Americans quickly, and one of the problems with

the payroll tax cut is it takes time. So we are much more focused right now on the direct payments.

We're going to come back again, you know, there may be a CARES 5.0. The President again is focused on money in American workers and American

pockets right now.

(END VIDEO CLIP)

QUEST: Lauren Fox is with us on Capitol Hill, our congressional correspondent. So between the Republicans at a trillion and the Democrats

somewhere north of who knows what, the area that they are really negotiating over is the $600.00 a week. Where is it likely to end up?

LAUREN FOX, CNN POLITICS U.S. CONGRESSIONAL REPORTER: Well, Richard, right now, this entire week has been just about Republicans trying to agree with

one another. They're not even sitting down at the same table yet with Democrats trying to negotiate and this discussion about what to do about

the deadline for unemployment benefits running out at the end of this month, like you said, is really the key sticking point that remains.

We expect that we will not see Bill text until next week. What Mnuchin told us earlier today was that the goal was to try to restore up to 70 percent

of an individual's lost wage, but it's still unclear precisely how they're going to get 50 different unemployment offices across this country to

implement a policy that's quite that complicated. So that's what they're trying to figure out right now.

But I'll tell you that I just Chief of Staff, Mark Meadows a few minutes ago, he said that they are still working. They're still negotiating, but no

complete bill text at this point. Obviously, a sign that there's still a little more work to do, Richard.

[15:10:13]

QUEST: Yes, but what's the politics in all of this, Lauren? Because if you're going to the country in a few months' time, in November, and

President Trump, let's face it, he won because of blue collar workers and suburban moms in those key states. They're the ones who've lost jobs, those

blue collar workers, do you really want to be going to the country saying, well, I didn't renew your unemployment benefits.

FOX: Well, I think that this has been the key sticking point for Republicans, not just this week, but for the last two months. I mean,

Republicans have been talking about this issue in their closed door lunches and having little consensus for about two and a half months at this point,

Richard.

And I will tell you that I think that concern among Republicans is that this additional $600.00 in unemployment benefits is keeping some

individuals from going back to work. That's the concern. Is this too generous of an amount of money?

But I think you touched on an important point here, which is blue collar workers, some of whom may be out of a job at this point. They're the ones

who could be hurt by Republicans not renewing this policy, and I think that that's what Republicans are trying to weigh at this point -- Richard.

QUEST: Lauren, thank you. Lauren Fox on Capitol Hill. Appreciate it. The financier, Bill Ackman says that the recovery, well, such that it is going

to be -- has a serious warning for the direction of the recovery. Now, it seems that the U.S. is slowing down once again on the back of the pandemic.

He spoke to CNN's Christine Romans.

(BEGIN VIDEO CLIP)

BILL ACKMAN, CEO, PERSHING SQUARE CAPITAL MANAGEMENT: I think it's a -- I think it's a bit like the ocean. Okay. I think we're going to have some

waves between sort of now and with a general trend up, but we're going to certain see some ups and downs as important parts of the country's economy

have to be throttled back because of the re-emergence of the virus.

CHRISTINE ROMANS, CNN BUSINESS CHIEF BUSINESS CORRESPONDENT: A lot of people who aren't you know, Wall Street players or people who are active in

stocks would be shaking their head trying to figure out how 51 million people could have filed for first time unemployment benefits over the past

17 weeks, but the S&P 500 is basically where it was pre-pandemic.

Can you explain in layman's terms what this disconnect is, and why Wall Street is doing so well, when clearly Main Street is suffering here?

ACKMAN: Wall Street and Main Street are completely different universes. You know, Wall Street when people think of markets, they think of the Dow.

They think of the S&P 500.

You know, the S&P 500 is a collection of the largest, most dominant companies in each of their respective sectors. Companies generally with

pretty strong balance sheets, companies that are designed to withstand, you know, very difficult events.

Main Street is comprised of mom and pop. It's comprised of businesses that don't have the balance sheet to withstand a pandemic, that don't have the

resources to build a digital infrastructure.

We should not be subsidizing the dominant companies that can withstand a crisis. We should be supporting the people and the businesses that need a

bridge to get to tomorrow, and that's really what you know, stimulus should be for.

(END VIDEO CLIP)

QUEST: Bill Ackman talking to Christine Romans.

Now, to the strange story of a Beijing consulate in Houston, and Beijing is now vying retaliation after the Trump administration closed the Houston

consulate or China's Houston consulate. The U.S. order cited spying and intellectual property theft.

Then of course, there's the burning of documents over the weekend. Now, the head of the Consul challenges the U.S. to provide evidence.

(BEGIN VIDEO CLIP)

CAI WEI, CHINESE CONSUL GENERAL OF HOUSTON: We have done nothing wrong. So you say the lies or the untruth a hundreds of times, that doesn't mean it's

true. It is still being -- it's still lies.

QUESTION: Are you saying the State Department is lying?

WEI: I didn't mention it. If you want to make accusations for us, give us some evidence.

(END VIDEO CLIP)

QUEST: Morgan Ortagus is with me. She is the State Department spokesman, joins me from Washington, D.C. Well, there you have it. He said -- he said

no spying going on here, says the Consul.

And whilst, he wouldn't exactly call it lying, made it clear that they don't agree with the State Department in any way. There's retaliation on

the cards. Are you ready for it? Can you hear me, Morgan?

Morgan is having some difficulty hearing me there, which suggests we should take a moment or two. We will come back to that because obviously, it's an

important discussion and we'll come back to Morgan in just a moment.

Also later, in the program, the World Trade Organization will have a new boss. We'll talk to one of the candidates who is hoping to take over the

leadership of that body. This is QUEST MEANS BUSINESS. Stay with us.

(COMMERCIAL BREAK)

[15:18:00]

QUEST: Well, we have paid the phone bill, and with a bit of luck and a following wind, Morgan Ortagus can hear me at the State Department, and

I'll ask the question, again, Morgan. The Chinese say nothing to see here, don't know what the U.S. is talking about. It's a case of they said, they

said. They deny that they were spying out of the Houston consulate.

MORGAN ORTAGUS, U.S. STATE DEPARTMENT SPOKESMAN: Yes, so obviously, this is a very serious action, Richard, that this administration had to take.

The last time as you know, quite famously, that we had to ask a country to leave a consulate is whenever the Obama administration asked the Russians

to leave after the election.

And so there's a few things that the F.B.I. and the Department of Justice have revealed. Director Wray actually talked about some of this on his July

7th speech. Attorney General Barr did as well.

But essentially, we see the Houston Chinese Consulate as the epicenter for research theft by the Chinese Communist Party in the United States. There

is -- we've uncovered spy rings.

But most importantly, I think what has been very troubling to us is the theft of research from our universities, from our hospitals. The theft of

intellectual property, the theft from technology companies.

And so the F.B.I. and the Department of Justice have started to lay out the case and show the facts. Again, I would point your viewers back to Director

Wray's speech, and we'll continue to give more examples.

This is one of the most egregious things that we have seen in this country, and so ultimately, we had to make the decision to close down this consulate

due to this massive, massive theft of our research and of our intellectual property.

QUEST: All right, so are you prepared for the retaliation? Because we know that Beijing will retaliate? It's not a question of if, it's a question of

when.

ORTAGUS: So all we want and Secretary Pompeo will lay this out just in an hour when he gives a major speech on China from the Nixon Library in

California -- all we want is a reciprocal relationship with the Chinese government.

[15:20:10]

ORTAGUS: We have had for almost 40 years, or even longer since Nixon went to China, the United States has tried engagement. We have tried bringing

the Chinese government into the international fold, into organizations, into the rules based order that we all know, enjoy and exist.

And under the leadership of Chairman Xi, what we have seen just these past few years, but really going back decades, you know, there's not a private

sector CEO in the technology, business, in energy and research who won't come onto your show and admit that this sort of breadth of theft is a

massive problem for these companies.

So America sat by for a Republican and Democrat administrations hoping that if we, you know, if we just acquiesced, if we sort of ignored the problem

that we could get the Chinese communists to behave -- the Communist Party to behave responsibly.

Well, that hasn't happened, and now we're not going to tolerate a billion dollars of theft, at least coming out of this consulate of research.

QUEST: Right. But wherever we look, relations between the U.S. and China are dreadful. The Chinese believe that they are the worst that they've been

in decades. Huawei, the spying scandal, the trade tariffs.

I hear what you say about wanting good relations, but the evidence is against you when I look at the results.

ORTAGUS: So Richard, I think what we want is a reciprocal relationship. We were just about three weeks ago, I was with Secretary Pompeo in Hawaii,

meeting with the Chinese Ministry of Foreign Affairs and our counterparts, and what they want is to continue to behave the same way that they've

always behaved.

You've seen the complete erosion of freedom and democracy and autonomy in Hong Kong. You see the Chinese locking up a million Muslims in camps,

right? We have seen forced labor coming out of these camps, making materials that businesses around the world use.

Nowhere else in the world are you seeing up to a million people locked up for their faith? We haven't seen this since World War II.

So if the answer to this, in order to have a good relationship is for us to ignore their bad behavior, that's not going to happen. We want a reciprocal

relationship and we want an honest relationship.

QUEST: Can I turn to Brexit, if I may. The Secretary of State was in London. And it's pretty clear -- now, they both pretty much said it, the

Secretary and the Prime Minister and the Brexit Secretary -- that it's not going to be possible to get a deal by the end of the year at the end of the

transition.

So are you going to aim for sectoral agreements that can be put in place before the end of the year?

ORTAGUS: So as you can imagine, trade was at the top of the agenda when we met with Prime Minister Johnson and Foreign Minister Raab, always

incredibly productive meetings.

Our counterparts at the Trade Office here in Washington, D.C. are going to work that aggressively. Secretary Pompeo knows that's a priority for both

sides of the Atlantic, and I will tell you, Richard, what's incredibly encouraging when we do meet with their counterparts in London, with the

Prime Minister is what we're seeing on things like Huawei, the British government made a strong choice for their own national security.

You saw them stand up as it relates to the Hong Kong Extradition Treaty. So we have to talk about issues around the world together, whether it's Iraq,

Afghanistan, Libya. We could go through the gamut.

There's not a major issue on the world stage where the United States doesn't work with Britain.

QUEST: But I hesitate to use this phrase, bearing in mind its previous connotations, but you'll know what I mean. When you look at the way the

British did act on Huawei, is there a quid pro quo, an implicit, nothing wrong with that, in the sense concerning, you know, all right, you helped

us out with Huawei. We'll give you a little bit more with trade.

ORTAGUS: You know, I've been lucky for the past year and a half to travel around the world with Mike Pompeo, and I've been in almost every one of his

meetings. And I've heard him say the same thing that he said to the Brits, that he said to the Israelis, that he said to the French, that he said to

the Germans.

The message is the same that each country we respect their sovereignty, and each country has to do their own risk assessment and determine for

themselves if putting a 5G infrastructure into their country that is beholden to the Chinese Communist Party by law, by the way, this is by

Chinese law that Huawei is beholden to that party, if that is what is in the best interest of each country.

Britain did a risk assessment. They decided that was not in their best interest. Listen, we didn't have it right for the U.S. in a long time. We

still have Huawei in some of our rural infrastructure. We had to get it out of our Defense Department, State Department. We haven't been right on this

for a long time.

But we recognized the threat. We're looking to stop it and we're encouraging other countries who share intelligence with us and who are

partners to do their own risk assessment. We believe that they're sophisticated enough to come to the same conclusion that we did.

[15:25:12]

QUEST: Morgan, it's realistically -- it's the 23rd of July, the election is in November. The common view now is that China is the whipping post for

the Trump administration for an electorate to show how strong the administration is going to be. And to some extent, the Chinese either will

or will not, for their own purposes accept that role during the presidential election.

ORTAGUS: Well, luckily, my boss, Mike Pompeo has been on record for over two years that he has been Secretary of State. He has made speeches talking

about this. He was one of the first Cabinet officials to question starting at least back in February, if not January about the fact that the Chinese

Communist Party was not being open as it related to COVID-19.

In February, he gave a speech to the governors. This was before the pandemic was so, you know, vocal in the United States and he talked about

in that speech about the threat that local municipalities and governors face from the Chinese Communist Party trying to gain access and influence.

So you could go back for the past two and a half years, even his time as C.I.A. Director where he has been very focused on this.

And listen, I think that you could look at President Donald Trump and say, when he announced he was running for President in 2015, and in that

campaign, listen, I've been in foreign policy. This is my third administration that I've been in. We just simply were not talking about

China five or six years ago, the way that the entire world is talking about it now.

So all you have to do is again, go back to those early speeches from President Trump, from Mike Pompeo, and you could see while things may have

been -- maybe we're more vocal right now in terms of policy actions, we've been talking about this for a very long time and I'm glad people are now

paying attention.

QUEST: And we're glad, Morgan, that you took time to join us tonight on QUEST MEANS BUSINESS. Much appreciate it. Thank you.

ORTAGUS: Thank you.

QUEST: Hopefully, we will talk again, as things move on. Thank you.

Now, it is QUEST MEANS BUSINESS. Before we take a break, I do to show you the markets and how they're trading because what you start to see about the

day is a realization on the poor economic numbers that we're seeing.

We saw our jobless claims. You're seeing it with the number of people who are flying. You're seeing it across the board.

And now we have just about two and a half percent drop on the NASDAQ, one and a half percent on the Dow, 400 points. I'm pretty certain that's almost

the low of the day. We've got 32 minutes left to trade.

It is QUEST MEANS BUSINESS. I'm Richard Quest with more after the break.

(COMMERCIAL BREAK)

RICHARD QUEST, CNN INTERNATIONAL ANCHOR: Hello, I'm Richard Quest. Of course, there's a lot more QUEST MEANS BUSINESS and a half hour. QUEST

MEANS BUSINESS to the top of the hour. And during that, we will talk about Tesla. Tesla is now going to be part of the S&P 500. The share prices are

up some phenomenal amount. And we need to understand where Tesla is going next. Also, Chipotle and the secret sauce, again, a share that's absolutely

stormed ahead. And it's all about digitization, and how the food company has managed to harness it to its advantage. The CEO will be with us in just

a moment. In fact, it'll all be after we've had the news, because this is CNN, and on this network, the news always comes first.

Moments ago, this was the scene in Jerusalem. It is still 10:30 at night. And moments ago, demonstrators were out on the streets; they're protesting

against the Israeli Prime Minister Benjamin Netanyahu. The owners of restaurants shut down by the pandemic are the latest group to join the

rallies. The Prime Minister's facing criticism of his response of the pandemic crisis and the state of the economy. More rallies are planned this

weekend.

President Donald Trump's former attorney, Michael Cohen, will leave jail again by Friday afternoon. He was originally released in May. The

government took him back into custody earlier this month. A federal judge has ruled the move was retaliation for Cohen's upcoming book about his work

for Trump. The Mayor of Portland, Oregon has been teargassed during protests in the city on Thursday morning. Mayor Ted Wheeler has urged

President Trump to withdraw federal agents sent to the city to quell unrest. It's still unclear who fired the gas. Portland police say it wasn't

them. And there's no indication that Wheeler was actually targeted.

What the markets are telling us today. And what the numbers we're seeing from the government and the employment numbers is that the U.S. economy is

stalling. As the pandemic numbers go up, and the market takes into consideration, slower growth, higher job losses, it's not surprising

economists like Mark Zandi from Moody's Analytics are worried.

(BEGIN VIDEO CLIP)

MARK ZANDI, CHIEF ECONOMIST, MOODY'S ANALYTICS: I don't think a trillion is going to cut it. 1.4 trillion is the minimum that would be necessary to

avoid going back into recession. And that assumes that you get pretty good a package of support, you know, things like help for state and local

governments that are hemorrhaging red ink and cutting employment, more help for unemployed workers, more food assistance and other income support. You

know, it has to be the right kind of package. So, if I were king for the day, Richard, I would have a much bigger package, probably something closer

to $2 trillion.

(END VIDEO CLIP)

QUEST: $2 trillion. Now, for individual companies just working out what's happening next is a major ordeal. Chipotle's Mexican Grill is seeing a

shift. Now, the online sales have taken off as in-person traffic obviously has dramatically reduced. The revenue is down nearly five percent from a

year before. But when you say only five percent, that's really very impressive. It still beat estimates. And the shares while they're down but

let's not worry about that one at all because look at the way they've gone up. They're now 1100. Overall, they're sharply hard. Chipotle's CEO Brian

Niccol; he joins us from Newport Beach, California. He joins us via Skype. And the trend, as -- are you concerned, Brian, that as the surge in cases

continues to rise, more lockdowns or at least restrictions are imposed, the recovery in your numbers will evaporate.

[15:34:57]

BRIAN NICCOL, CEO, CHIPOTLE (via Skype): Yes, obviously. You know, I shared the concern about -- just about everybody when it comes to seeing the rise

in cases, you know, what we would prefer -- I would prefer, I think, is, you know, to see the cases going in the other direction. You know, and

obviously, what we want to do is make sure that as we operate during these challenging times, we do it in a safe way. And then, we do it in a way

where we can provide people access to, you know, the food that they want to have access to, whether it's delivery, takeout, you know, give it to them

off-premise, so they can potentially enjoy it at home or outside where they feel safe eating meals.

QUEST: Are you at the point now of saying for the foreseeable future, off- premise and delivery is going to be the significant -- particularly delivery is going to be an area where you're going to have to put more

focus, even more focus.

NICCOL: Yes, you know, I think it's going to be a balancing act between being able to order ahead and get food for takeout, as well as delivery.

You know, I think some people still prefer to have the control of that experience, where, you know, they control what time they pick it up and

what happens with their food from the moment it leaves the restaurant until it gets home. And then, for those occasions where, you know, you've got the

time to wait for a delivery driver, you know, the good news is we can create contactless delivery and get people access to food that way.

But I definitely think, for the time being, people are going to put a real premium on the idea of having a safe eating experience, which, for a lot of

people, that psychology right now is still an off-premise experience where they can kind of control more of the environment of those that are around

them, and where they're choosing to eat their meals.

QUEST: You did a deal with Grubhub and Uber, and they are, of course, are drivers, but in the sense that you have -- I mean, at Chipotle, do you have

to be agnostic as to the delivery service?

NICCOL: Yes, I mean, what we found is for Chipotle, a lot of people wanted to have access to our food for delivery. And obviously, the aggregators

that you mentioned, in order for them to be, you know, a compelling aggregator, they want to have all the restaurant options that customers

want. So, this works out really well, where we want to be on their sites. They want us to be on their site, and the customer wants us to show up in

all these places. So, we enjoy the fact that we have partnerships with DoorDash, Grubhub, UberEATS, and Postmates. You know, they're the big

players. And, you know, we need each other to give the customers a great delivery experience. So, we're working really well with each of them. And

we're really happy with the experiences that we're providing customers right now.

QUEST: Brian, good to have you on the program. And I -- you know, I'm still promising that the moment this pandemic is over, or whatever, and we get a

chance to talk to each other face-to-face over a meal and over food at Chipotle. And I even promise, as I've promised before, I'll pay the bill.

You don't hear that every day.

NICCOL: Well, I'll look forward to that day. You know, it'll be a lot of fun to be able to share a burrito with you, so take care.

QUEST: Good. After the -- all right. Brian Niccol from Chipotle. Now, investors are tapping the brakes on Tesla. It's hardly surprising. It's

only just four percent but let's not get too concerned about that. If you look at the way the company has gone on a tear, now it is just had in total

four straight profitable quarters, which means it can join the S&P, but it's up 250 percent since January. S&P -- Tesla now joins the S&P. And

here's what you need to join the club.

You have to be U.S.-based and has the headquarters are in California. You have to be listed on the NYSC, the NASDAQ, CBOE, and Tesla is on the

NASDAQ. And you have to have a cap of at least 8.2 billion. They absolutely have that; they're 278 billion. And you have to have four straight,

profitable quarters. Clare Sebastian is with me. Now, the significance of being on the S&P, besides bragging rights, is something to do with funds

that have to buy you. Explain.

CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes, you have a lot of passive inflows or a lot of funds that are -- that are indexed to the S&P 500,

where you end up pretty much buying every stock on it. So, I think the expectation is that a lot more people will end up trading in Tesla. But,

Richard, it's not automatic, they are not automatically in the S&P 500. This is an index that's actively managed. A spokesman for S&P indices told

me that they have -- they meet the eligibility requirements, but they're not automatically added to the index. They join a pool of eligible

candidates that are considered for inclusion when an opportunity presents itself.

And that decision will ultimately be made by the index committee who meets on a quarterly basis. So, they are now eligible. It looks like it could

happen, but of course, this is -- this is an index of 500 companies. For them to join, another one has to be booted off, which is another decision

in itself.

QUEST: Clare, this is an impossible question, but let's go for it anyway. And the market decides what the price of the stock is worth, granted. But

if you were to strip out all the hype and all the -- what does the market believe should be or really is the underlying value in the price?

SEBASTIAN: Richard, I think the extraordinary thing with Tesla, and this has really always been the case, even before we saw the sort of phenomenal

rally that we've seen in the past six to 12 months is that you see a huge division in terms of the targets for the price that people set. On Wall

Street, right now, they range from sort of 700 range to more like 2,400. I think it depends on a couple of questions.

One, are you prepared to assign a $300-billion market cap to a company that really delivered roughly the same amount of cars in the last quarter that

it did in the same period last year, and didn't really earn much more in terms of revenue? Are all, you know -- and I had to look beyond that and

trade into sort of the future of this stock, as a -- as a company that's sort of tapped into Clean Energy and is now building factories on three

continents. I think that's the big question. Plus, are you trading it as a carmaker or as a tech stock? So, that is the key issue here. But we do see

a wide range. It's very divisive as a stock, Richard.

QUEST: Clare Sebastian, we'll talk more on that point in a while. Thank you, Clare Sebastian, joining us tonight. It's QUEST MEANS BUSINESS after

the break. Well, the show must go on but just not yet. Broadway now says that it hopes to reopen in January of next year. The president of Broadway

League on what it will take to open, and how the theaters -- how they're all managing between now and then. After the break.

(COMMERCIAL BREAK)

QUEST: "CALL TO EARTH" CNN's call to action for the environment, where we share solutions to what our critical issues, and we want to work with you,

our friends and our audience to drive the awareness. And I think most crucially, to inspire change. Today's report is an all-female crew that

sailing around the world to examine and understand about plastic pollution in the ocean.

[15:45:18]

(BEGIN VIDEOTAPE)

EMILY PENN, CO-FOUNDER, EXXPEDITION: They stay longer at sea, you just have this opportunity to really connect with nature, to constantly shift your

sails to the changes in the environment around you, to then find that we are impacting our planet in the way that we now know is really

heartbreaking. I'm Emily Penn, co-founder of eXXpedition, a series of all women's sailing voyages, and we're currently sailing around the world

looking at plastic and toxic pollution.

UNIDENTIFIED FEMALE: Around 8 million tons of plastic waste enter the oceans every year. A common misconception is that it floats on the surface

in plastic islands. But in fact, plastics break down into smaller pieces called micro plastics, and the vast majority is invisible to the naked eye.

Emily has been working for years to highlight the abundance of plastics in the oceans and the expedition she leads, travel to waters around the world

to study how plastic is distributed and how it accumulates.

PENN: This very important bit of equipment right here, is meant to troll. This is the piece of equipment that we actually put over the side of the

boat using this spinnaker pole to deploy it to collect our scientific samples. The reality is, the plastic breaks down quite quickly. From the UV

rays from the sun, the wind and the waves break it up into these tiny fragments, micro plastics, they are smaller than your little fingernail.

And we now know that there's over 5 trillion of them floating on the surface of our ocean, and probably many times that that have sunk to the

depths. There's already a lot in that layer. Look at that. A lot of plastic.

UNIDENTIFIED FEMALE: Wow.

UNIDENTIFIED FEMALE: At least, some level of plastic can be found in every ocean on the planet. But as accumulates in the oceans gyres, large systems

of circulating currents, dangerous manmade chemicals can also accumulate there. And these persistent organic pollutants, find the plastic in the

water. They enter the food chain to being mistaken for food by marine life, rising up until both the chemicals and the plastics reach that peak, the

human body.

PENN: We chose 35 of these toxic chemicals that are banned. We found 29 of them in my body, they mimic our hormones and stop important chemical

messages moving around our bodies and realized that actually being a woman, having those chemicals inside my body during pregnancy, would be really bad

news. And so, I thought, wow, this issue is actually quite a female- centered issue. So, why not tackle it with an amazing team of women? And so, eXXpedition was born.

UNIDENTIFIED FEMALE: EXXpedition's most recent voyage is nearly halfway through circumnavigating the earth, exploring plastics and toxin levels in

the ocean. By its end, it would have traveled to four of the oceans' largest gyres.

PENN: So much of our own impact on this plastics issue and the ocean, it really starts with our daily choices, particularly our single use plastic

consumption. We are finding bottle tops, we're finding plastic bags, we're finding all those things that have been used once and then thrown away. If

we can do without it, then let's not use it.

(END VIDEOTAPE)

QUEST: Fascinating. And we'll continue showcasing inspirational stories as part of our initiative, and let us know how you're also joining in and your

ideas, your initiatives, your own inspiration. The hashtag, Call to Earth, #CalltoEarth. We'll be right back.

(COMMERCIAL BREAK)

[15:50:00]

QUEST: Everybody seems wants to go to Mars at the moment. Earlier in the week, the UAE sent up its probe, it'll take some seven, eight months to get

there. Now, China hopes to be in the lead by what it sends up to Mars. Beijing has just launched what it hopes to be the first successful mission

actually to the planet. The probe will reach February of next year, and the U.S. will launch its own mission in just a few days' time. It must be the

right time of the year to be launching things that are going to get to, to Mars. CNN's Ivan Watson on the Chinese attempt.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Space, a final frontier.

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: For more than 60 years, nations have competed to see who can be first to go where no one has

gone before. The country that leaps ahead in the great space race gets bragging rights and so much more. The Soviet Union shocked the world when

it launched Sputnik, the first satellite to orbit the Earth, in 1957. And followed up with an even bolder feat in 1961, putting the first human in

space cosmonaut, Yuri Gagarin.

The Soviet's successes embarrassing for the United States, already in the throes of the Cold War with the USSR. Gagarin's accomplishment prompted

U.S. President John F. Kennedy to famously declare his vision of putting a man on the moon before the end of the decade.

NEIL ARMSTRONG, ASTRONAUT: That's one full step for man. One giant leap for mankind.

WATSON: And go to the moon they did, in what would be the defining moment that led to U.S. dominance in space exploration for more than 50 years. It

may have been late to the game, but China is now hoping to change that, as part of its 13th five-year plan that singles out space exploration as a top

research priority. Under President Xi Jinping, Beijing has invested billions of dollars in its space program. And in 2016, Wu Yanhua, Deputy

Chief of China's National Space Administration declared, our overall goal is that by around 2030, China will be among the major space powers of the

world.

Now, just 40 years later, and fresh from the success of being the first nation to send a rover mission to the foreside of the moon, China is

looking to raise the competitive bar with its first mission to Mars. The scientific team behind China Tianwen-1, which means quest for heavenly

truth, say their probe is different because it is, "going to orbit, land, and release a rover all on the very first try, and coordinate observations

with an orbiter. "

This is unlike NASA, which launches its Mars missions in stages, and plans to send its seventh Mars mission later this month. If successful, China's

Tianwen-1, NASA's perseverance, and the United Arab Emirates, hope the Arab world's first interplanetary mission, will all three reach the Red Planet

in February 2021.

[15:55:02]

WATSON: And while scientists look to work together to uncover the planetary secrets of Mars, China and the U.S. have put their space programs into

overdrive, signaling more competition between these rival superpowers, each hoping to pull off the biggest breakthrough in space exploration, such as

putting a man or a woman on Mars, perhaps as early as the 2030s. Both hoping to be the first --

WILLIAM SHATNER, ACTOR: And boldly go where no man has gone before.

WATSON: Ivan Watson, CNN, Hong Kong.

(END VIDEOTAPE)

QUEST: Now, the markets just before we have a break, look at the way they've gone. And you'll see, if you look at the Dow 30, Microsoft and

Apple, are very sharply lower. That's what's dragging the market down. And that was a 4-1/2 percent, Microsoft's off 4.3 percent. And it was going on

their courses. First of all, giving back a lot of the gains. They have rolled ahead in recent weeks.

Secondly, problems with China. If there's China difficulties and China's looking to retaliate, then companies like Microsoft and Apple could well be

in the forefront of those. Boeing also largely low as well. This is what that's all about. We will have a PROFITABLE MOMENT after the break.

(COMMERCIAL BREAK)

QUEST: Tonight's PROFITABLE MOMENT, we are in extremely dangerous economic territory. As the number of jobless rises in the United States, the

pandemic, arguably in many cases is out of control. And all economic numbers like people -- number of people, flying, retailing, all these sorts

of things are slowing again, having originally was picked up with a bit of recovery. If this continues, then we are looking at a double dip recession,

because the recessions been very short, but very deep.

And that's what's going to consume economists, and probably policymakers as they decide the size and scale of the stimulus package in the United

States, in the days ahead. And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in London, whatever you're up to in the hours ahead, I hope

it's profitable. Bye for now. The bell's ringing.

END