Return to Transcripts main page
Quest Means Business
O.E.C.D. Sees Economic Hope as Fed Chiefs Urge Action; Yellen Mourns American Tragedy over Coronavirus; Germany Constructs First Mass Vaccination Center; Barr's DOJ: No Finding Of Fraud In U.S. Election; Economic Downturn Needs More Than Monetary Policy; China's Early Knowledge And Denial Of COVID - New Documents
Aired December 01, 2020 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:20]
RICHARD QUEST, CNN BUSINESS ANCHOR, QUEST MEANS BUSINESS: Lots of undercurrents in the market as we go into the last hour of trading on Wall
Street. The Dow is pushing 30,000. I question whether they can put that last hundred on or so in the last 60 minutes of trade.
But that is the way the markets are looking, and this is the day as it has panned out. An economy is screaming out for help. Top Fed officials make
fresh calls for government action.
Europe's vaccine timetable is getting firm.
And Janet Yellen speaks of an American tragedy, as she joins forces with Joe Biden.
We are live in New York on Tuesday. It is December the first -- where did the year go?
I am Richard Quest, I mean business.
Good evening, tonight, markets chasing more record highs as a stellar run for these stocks is now revealing a fundamental disconnect. Before all this
optimism can be justified, there is so much more work to be done, which calls into question whether this optimism is justified.
The Dow has been trading back above 30,000 in the morning hours. It fell back again now, but you see we've just rallied up 29,897. So 30,000 is a
possibility over the next hour.
The O.E.C.D. has given an oomph to the market by lifting its economic projections. The O.E.C.D. says global GDP growth will return to pre-
pandemic levels by the end of next year. The O.E.C.D. is acknowledging that is not a given. The President of the Chicago Fed told me the economy needs
help that only political leaders, not monetary can give.
(BEGIN VIDEO CLIP)
CHARLES EVANS, CEO, FEDERAL RESERVE BANK OF CHICAGO: This is a real economic downturn. It's a public health safety crisis and so that screams
out for remedies other than monetary policy.
(END VIDEO CLIP)
QUEST: We will hear more from President Charles Evans of Chicago later in the program.
There was joint testimony today from the U.S. Treasury Secretary Steve Mnuchin and the Fed Chair; and together they underlined the rifts that
stand in the way.
Jerome Powell said now is no time for complacency.
(BEGIN VIDEO CLIP)
JEROME POWELL, CHAIRMAN, U.S. FEDERAL RESERVE: The risk of overdoing it is less than the risk of undoing it. That is the record of pandemics and
crises.
We've come a long way. The CARES Act did a tremendous amount of good, we can see what may be the light at the end of the tunnel with the vaccines.
And I just would want us -- we, at the Fed will keep at it until we're really done and I think that some fiscal support now would really help move
the economy along as well, at least to guard against those downside risks we've been talking about.
(END VIDEO CLIP)
QUEST: Cristina Alesci is with me in New York. I mean, it reminds me of the days of the horseless carriage where you had to walk in front of these
new contraptions with a red flag ringing a bell to warn people of what was coming. I mean, what more does Jerome Powell have to do?
CRISTINA ALESCI, CNN BUSINESS POLITICS AND BUSINESS CORRESPONDENT: He did everything that he could to press again for the need for fiscal stimulus,
for Congress to step up, do its job and get much needed relief to the American public, and this is actually an issue that both Jerome Powell and
Stephen Mnuchin, the Treasury Secretary agreed upon. The details around that, of course, I'm sure they diverged on, for example, the level of
stimulus necessary.
But it was notable that both men spoke about that and my ears perked up as I'm sure many at home also noticed. Stephen Mnuchin, the Treasury Secretary
saying that the Congress should extend those emergency unemployment benefits for millions of Americans, 12 million people risk losing
unemployment benefits when they expire at the end of the year if Congress doesn't act.
One area where the two men did not agree was on the Treasury Department pulling that emergency funding to Federal Reserve programs that would have
extended credit, for example, to small businesses. Democrats ripping Stephen Mnuchin apart on that. Here's an exchange between Sherrod Brown,
the Ranking Member and Mnuchin.
(BEGIN VIDEO CLIP)
SEN. SHERROD BROWN (D-OH): You appear to be trying to sabotage our economy on the way out the door. After the election, you canceled the Federal
Reserve lending programs, taking away critical tools to invest in the people and the communities and the small businesses that make this country
work. There is no legitimate justification for it.
STEVEN MNUCHIN, U.S. TREASURY SECRETARY: My decision not to extend these facilities was not an economic decision. I'm surprised to hear Senator
Brown use words like sabotage, no legitimate justification, delusional malpractice. Time for action. I'd be more than happy, Senator Brown to come
see -- and your staff -- and walk you through the legal analysis.
(END VIDEO CLIP)
[15:05:39]
ALESCI: Richard, to your point, Jerome Powell was very clear about the need for more stimulus. At one point, Mnuchin was out there taking a bit of
a victory lap. You know, citing the progress and how people had regained -- millions of Americans had regained jobs in the recovery.
Jerome Powell quickly, however, noting that while the progress was welcome that there is so much more work to do, and one thing that it is clear he is
passionate about is this issue of inequality. It is an issue that the incoming Biden administration, we heard from the economic team that was
nominated today, it is an issue that is going to persist going forward, and it is one that Biden economic team is very focused on curing -- Richard.
QUEST: Thank you, Cristina Alesci. Now, the O.E.C.D. says that for the first time since the pandemic began, there is hope for a full recovery. The
real problem, of course is, reality could get in the way.
Government action is what they say the hope from the O.E.C.D. sweeping stimulus. The reality as you've just heard, partisan splits in the U.S. and
problems within Europe.
On Central Banks, the hope is accommodating monetary policy will do the trick. The reality, it's already hit its limits, according to many central
bankers.
And finally, on the question of vaccine, the hope, just having them solves everything; the reality, the rollout will take many months. The market
seemed ever hopeful. The Dow and the stocks, 600, have more than recovered their losses from the spring. Brent crude has also risen over the last
month.
David Rubenstein is the co-founder of the Carlyle Group. David is with me now. It is good to see you.
You're the author of "How to Lead." You join me from Bethesda in Maryland. This difference, this growing discrepancy between what markets believe is
going to be an outcome and what economic reality is suggesting is now starting to get worrying?
DAVID RUBENSTEIN, CO-FOUNDER, THE CARLYLE GROUP: Yes, the markets are always forward indicators. The markets have believed that having the
vaccine would really help the economy and it will. But we now know that the vaccines will probably take six months before they are fully disseminated
and maybe as long as nine months.
So it's going to be a while before we really have everybody vaccinated who should be vaccinated. You need about 70 to 80 percent of population to be
vaccinated for that to happen, and we've never really done anything quite like that before.
I think the pharmaceutical industry and the government of the United States deserves credit for getting a vaccine done in one year, which is a historic
low period of time, but we need to get it distributed. And that's not going to be easy to do.
I think at the same time, if we don't have some stimulus from the Congress, I think the economy is going to slip again into a recession. So we need to
do something now. It doesn't have to be two trillion right now, but at least 500 billion to a trillion would be helpful to getting us through the
next three months or so.
QUEST: What's the problem here in terms -- I mean, everybody, both sides of the political aisle say we need stimulus. Every economic thinker like
yourself says, we need stimulus. Jerome Powell today you would have heard earlier couldn't have been clearer. So, what's it going to take in your
view?
RUBENSTEIN: Well, there's always a problem in Washington, D.C. of who is getting the credit, who is getting the blame. So there is still a lot of
walking around saying, well, if we do this now, who is going to get the credit for it? Who is going to get the blame if we don't do it? And I think
until the Georgia elections are over and we know who's going to control the Senate, I don't really think you're going to get legislation through.
I'm hopeful, though, that a modest package, modest being 500 billion or so would get through before the election -- before the inauguration occurs,
because it's going to take a while for the new administration to get new legislation through.
I think by the end of January or the end of February, if we don't have another $2 trillion into the economy through the Congress, I think you're
going to begin to see a lower and lowering of economic growth projections. So I think it's a real challenge.
And again, getting this vaccine fully distributed and everybody taking it is not easy. You have more than 50 percent of the population willing to
take it, but about 47 percent not willing to take it yet and that's going to be a problem.
QUEST: You know, the thing that worries me, I mean, is the -- I don't think I'm giving away any secrets when I say you're a wealthy man and I'm
not exactly poor either, but we're talking here about help for people who are about to lose unemployment benefit, who are about to lose the literally
the cost of groceries.
And I wonder what part politicians are not seeing, talking about waiting until January the fifth?
[15:10:25]
RUBENSTEIN: Well, hopefully there's enough public pressure Congress will act, Congress does reflect the country and you say, I'm a wealthy man, but
I could die in two weeks if I get this vaccine -- if I don't get this vaccine, I get this COVID-19. It doesn't make a difference how wealthy you
are in terms of finances, if you have this disease, you could die.
We've lost 200 and plus thousand people already, and I could be one of them. And I'm 71 years old, so I'm at risk. So everybody needs to do
something to get the vaccine as soon as they can and I think we need to do as much as we can to tell Congress, look, put everything aside, politics
aside for the good of the country right now. Let's come forward and pass something so people that don't have financial means can afford to feed
their children, feed their family and have a basic subsistence living.
QUEST: Foley here, as they say. Let's turn to the new administration, there's going to be more regulation. There will be a reversal of many of
the Executive Orders, and do you think businesses are worried? Are you worried that that there'll be a pendulum effect swing too far back with a
Democratic Party that is greatly motivated and pushed further by progressives?
RUBENSTEIN: I think the progressives are trying to get as much as they can, but they recognize that they didn't do as well in the election as
maybe they would have thought and the House is more Republican than it was before, and that the Senate will either be very tightly controlled by that
Republicans or very narrowly controlled by the Democrats, but it's not going to be a large majority one way or the other.
So I think the Republicans are going to have some fair amount of influence, and I think that progressives realize that their grandest hoax are not
likely to be realized in this Congress. And I think the President-elect is somebody who is not a traditional progressive. He's been a person who has
been in the Congress for quite some time and been Vice President for eight years. He knows how to get things done that require compromise.
So I don't really think the business committee is that worried. I think the business committee is mostly worried about not getting some action right
now over the next couple of months. I think they're not worried that all of a sudden, we're going to have the new green policy all of a sudden become a
law, I don't think that's likely to happen. At least the business committee doesn't believe that's going to be the case.
QUEST: So related to this regulation, because obviously, Joe Biden has -- taxes are going up, corporate taxes are going up, there will be greater
regulation. Do you see -- and I know, they're not even in power yet, I'm already asking you, you know, what are the problems? Do you see a less
favorable environment for deal making, for M&A, and the like, under the new administration?
RUBENSTEIN: No, I don't see that at all. Interest rates are going to stay low for quite some time, that's been very helpful to deal making, as you
know. And right now, there's a lot of capital on the side waiting to do deals that hasn't even slowed down. So I don't think it's a problem.
Regulations take a long time to get implemented and I don't think the business community is that worried about it. They prefer to have fewer
regulations than probably more regulations. But that isn't the biggest concern of the business community.
The biggest concern right now is making certain we can go back to work, getting everybody vaccinated so we can go back to normal works lifestyle,
and then getting something out of Congress to deal with a stimulus. Those are the two biggest concerns of business. It's not taxes and regulations
right now.
QUEST: And finally, the Georgia runoff. I mean, I can -- I don't think any of us have ever seen quite an occasion where that so much hinges not just
on one, but on two runoffs in a single state, where everything, including the kitchen sink is going to be poured into it. And really, would you agree
the ability of the President-elect to make -- to get his agenda across depends on what happens.
RUBENSTEIN: It will be helpful to him if he could win those two seats. It's difficult to think that Democrats could win both of those seats.
Historically, they haven't done that well in these kind of runoff elections in Georgia. But this is a different time. We don't really know who is going
to show up, everything is turnout.
And so what you can only say is that Georgia is on our mind for another month or so and it's going to be a very important turnout.
QUEST: I was hoping you might have sang that for us. Thank you, David. Good to see you, sir. I appreciate it.
RUBENSTEIN: Thank you.
QUEST: Thank you, now, to breaking news. U.S. Attorney General William Barr has told The Associated Press his Justice Department has found no
evidence of widespread voter fraud, fraud that would change the outcome of the presidential election.
Let me just repeat that because the significance of that: no evidence of widespread voter fraud that would change the outcome of the presidential
election.
[15:15:06]
QUEST: Now, great expectations for a COVID vaccine as David Rubenstein was saying, it's on both sides of the Atlantic behind the scenes of a German
vaccination center under construction and getting ready.
Right here in the U.S., the C.D.C. is meeting to decide who gets the first vaccination shots. We will speak to the CEO of GAVI, the Vaccine Alliance
after the break.
(COMMERCIAL BREAK)
QUEST: The E.U. is weeks away from authorizing two COVID vaccines. It is believed the European Medicines Agency, the EMA, has set end dates for its
review of the Moderna vaccine, and one of course from Pfizer.
Germany is wasting no time to get ready. CNN's Fred Pleitgen reports.
(BEGIN VIDEOTAPE)
FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Germany is in the process of constructing dozens of vaccination centers like this one,
and essentially what the Germans are saying is that because some of the vaccines that are set to be approved fairly soon will have to be stored at
ultra-cold temperatures, they are going to build facilities like this, where they have the freezing capacities, and then just bring a lot of
people to here to get vaccinated.
And the way to do that safely, they believe, is to create what they call vaccination lanes, like you see right here. And the way all this is going
to work is that first of all, people who are going to get vaccinated, they come to this first room we're currently wiring and internet is being laid
right now, and they're going to speak to a doctor there. And then that doctor is going to ask about possible preexisting conditions, medical
conditions that could make it dangerous to get a vaccination shot.
Then people come over here, and this is really the area where people are going to get the vaccine where people are going to get the jab
administered. You can see there's four rooms here. And that's just because they want to be able to bring several people in here. For instance, one
person may be taking off their shirt to get the shot, another person might already be done, and putting their shirt back on after getting the shot.
That's just to be able to increase the amount of people who come through in a safe way.
And then finally, the folks who are going to get their vaccine are going to come to this area right here. And this is sort of the observation area
where everybody who gets a vaccination shot is going to be monitored for 15 minutes to make sure that people don't have any sort of severe reactions to
the vaccine. And at that time, they're going to be constantly monitored by medical personnel.
The German say that this particular vaccination center is going to be finished by the middle of December and it has the capacity to vaccinate
about a thousand people every day.
Fred Pleitgen, CNN, Eschwege, Germany.
(END VIDEOTAPE)
QUEST: So which thousand people? Well, it doesn't matter whether it's in Germany, the U.K., Australia, or wherever. You've still got to decide who
is going to get it first.
In the United States, an independent panel is meeting now, right now to advise the C.D.C. on who should get vaccinated. Their vote is described by
one longtime member of that panel as unprecedented. A former Director of the C.D.C. is clear on where he believes the priority must lie.
[15:20:21]
(BEGIN VIDEO CLIP)
DR. TOM FRIEDEN, FORMER DIRECTOR, U.S. CENTERS FOR DISEASE CONTROL: You want to really focus on nursing homes, because that's where 40 percent of
the deaths have been. In terms of fairness, you want to make sure that doctors get it because nurses and all healthcare workers, not just the
people who you may see stories about, but the people cleaning the floors, the people checking people in, the people who are exposed and are at risk,
not just getting it, but of spreading it.
(END VIDEO CLIP)
QUEST: Seth Berkley is CEO of GAVI, the Vaccine Alliance, which works to get vaccines to kids and others in the world's poorest countries and Seth
is in Geneva. We will come the work of GAVI in just a second. But the difficulty here, I'll give you an example. Does a 55-year-old policeman,
have a -- should get it ahead of 22 year old nursing home worker. You see where I'm going with that.
Once we start going down this road of who first, you then really end up in, well, yes, but then you've got to add in age and you've got to add in this
and that and the other. What's the principle do you think we should follow?
SETH BERKLEY, CEO, GAVI: Well, we were clear when we started, Richard that we want to get it to health care workers first. Why? Because they are
critical to take care of patients and to make sure the health system doesn't get overwhelmed. But also because potentially, if the vaccine
blocks transmission, they are also going to be exposed to people who are at risk and they could transmit to.
So the idea was healthcare workers first, and that takes some of the drain off the healthcare system and then move to the most vulnerable, starting
with the elderly, and then moving into other risk groups.
QUEST: This is an ethical question, I mean, obviously, it has an ethical involvement, but between, say, elderly, and healthcare workers, as you put
it, or is this one of those things where reasonable people can disagree?
BERKLEY: Well, I think everybody will have their own opinion. Of course, I'm focused on most of the rest of the world, poor countries, et cetera,
and in those countries, the healthcare workforce is so small already, any loss of that healthcare workforce will make a difference for you know, the
whole healthcare system.
QUEST: So, whilst this is a cruel reality, we have been talking about reality tonight, it's a cruel reality that whilst just about everybody is
going to be nearly vaccinated if they wish to be by mid to late next year in developed economies, I wonder how fast and how far you think developing
world Africa, Sub Saharan Africa before they get the vaccine in serious numbers?
BERKLEY: Well, Richard, as you know, we formed the COVAX Facility exactly to deal with that challenge. In 2009, during the swine flu, all of the
vaccine went to wealthy countries. We believe the world isn't safe, the economies won't come back unless everyone is safe.
So today, 189 countries are engaged. That's high income, upper middle income as well as low income countries. And the idea is to try to have it
within a reasonable timeframe of when it gets rolled out in wealthy countries. That's the right way to deal with a global pandemic, it is with
a global response.
QUEST: Because there's also the problem that not only will the developing -- the poorer countries, emerging markets -- not only will they not get the
vaccine or are at risk of getting it, the people living there will be stigmatized and face the sorts of restrictions that will prevent them
taking part in the global economy.
BERKLEY: Well, I think that's true, but you have to remember, no vaccine is a hundred effective, nor do a hundred percent of people get it. So if
there are large reservoirs of virus circulating anywhere in the world, it puts the whole world at risk. So countries that are wealthy, even if
they're vaccinated are not going to be returning to normal commerce and trade and tourism, unless they know the epidemic is dampened everywhere in
the world. And that's why it's so critical this is a global response.
QUEST: How much more money do you need? I know you got -- recently, you got another $2 billion to buy vaccines, and I presume all the various
manufacturers are selling to you at cost, but how much more money -- how long is a piece of string do you need?
BERKLEY: Well, we're asking for an additional $5 billion because we want to deliver a billion doses in developing countries by the end of 2021. Of
course, we don't know yet what the final cost is going to be. It's going to be depending on the yield of the vaccines, which particular combinations of
vaccines ultimately are rolled out there, but that's a pretty good estimate of what it's going to cost.
[15:25:09]
BERKLEY: And again, this is in everybody's best interest.
QUEST: Which of the vaccines -- pardon the beauty contest -- which of the vaccines do you like the best? Obviously, because of the difficulties of
transportation and storage, which one works best for you and your patients?
BERKLEY: Well, I mean, I think this is a question of what location and in what population? It's been extraordinary, the mRNA vaccines, we've seen
very, very high efficacy for a new technology, really exciting.
As you know, the AstraZeneca results have just come in, a slightly lower efficacy result, although that was in interim studies. We're waiting for
more data. But that is an easier to use cold chain. Some of the vaccines coming down the pike are single dose, and there are new technologies coming
that also may bring advantages.
So we're going to have to look at not just the vaccines where they're used, but also which sub populations are we talking about? Elderly? Are we
talking about women of reproductive age? Are we talking about refugees? It's going to matter for which vaccine is best for them.
QUEST: The level of complexity, it's phenomenal, but I'm grateful, sir that you came today to tell us about it and we'll talk more. From GAVI,
thank you.
The U.S. Attorney General, having said that they would look for credible not just fanciful examples of electoral fraud now says he finds no evidence
of fraud. Implications of that after the break.
(COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest, there is more QUEST MEANS BUSINESS in just a moment, lots more in fact, after I've given you the news headlines
because this is CNN and on this network, the facts always come first.
[15:30:00]
German police say five police have been killed including a nine-month old baby when a car was driven into a pedestrian area in the town of Trier.
A 51-year old man is under arrest. The prosecutor say the driver was severely intoxicated. The police say it's unclear whether there was a
motive.
China is doubling down in its defense of a government official's tweet which shows a doctored image of an Australian soldier threatening an Afghan
child.
The Chinese foreign ministry has described it as an animated illustration and claims it does distort the facts.
Lewis Hamilton has tested positive for COVID-19 and therefore, will miss Bahrain's Sakhir Grand Prix. The Formula 1 champion developed mild
symptoms after winning the Bahrain Grand Prix very the weekend.
Hamilton's Mercedes team says his replacement driver will be announced in due course.
Breaking news. No evidence of electoral fraud, widespread voter fraud. That's according to William Barr, the U.S. attorney general.
"The justice department has found nothing that would change the outcome of the presidential election."
Evan Perez joins me now.
Well, there's never -- Evan, there's never the wrong time to do the right thing. But this, this brings an end to it.
EVAN PEREZ, CNN SNR. U.S. JUSTICE CORRESPONDENT: Well, you would think so, Richard. Look, the fact is this is like the attorney general stepping out
of the building and saying guys, the world is not flat. And we would have to treat it as news, right?
But the fact is that the attorney general has been echoing some of the claims by President Trump that the election was going to be unsecure, that
there was going to be fraud in the recent election.
And so him giving an interview to the Associated Press in which he says, for the first time, that they've looked into these claims of alleged fraud
and he says that they have found no evidence to indicate any kind of widespread fraud that would have made a difference in the election.
That means that Joe Biden is the president-elect of the United States, Donald Trump lost the election fair and square. That's what Bill Barr is
trying to get across.
I'll read you just a part of his quote where he says --
QUEST: Please.
PEREZ: "To date, we have not seen frauds on a scale that could have affected a different -- that would have effected a different outcome in the
election."
As you pointed out, there's never a wrong time to do the wrong thing. It's been a couple of weeks since the attorney general was last seen in public,
he's been reluctant to come out here and set things straight.
The president has been making these very wild claims that Venezuela and a bunch of other conspiracies were involved in fixing the election.
None of that is true, of course. And now we know it from the justice department that they've have actually looked into it and found zilch.
QUEST: Right. But Evan, even when he's -- I'm just looking, I'm just calling up the quote, whilst we're talking -- even when he said he was
going to get his teams, his investigators to look, he said we won't look for specious or speculative fraud.
So to cynics then, he had always given himself a get out of jail free, pardon the pun, for the attorney general.
I just can't see that the White House can do anything other than concede at this point. Of course, it's highly unlikely they won't but I just can't
see how they avoid doing that.
PEREZ: Right, eventually they will, obviously. We know what's going to -- we know how this story ends, Richard.
But look, I think one of the things that we have to consider is the fact that the president and the people around him, Rudy Giuliani, Sidney Powell,
some of these other lawyers who have been going around filing these very frivolous lawsuits, this is not really about pursuing fraud.
They've raised $170 million for this organization that the president is going to be able to benefit from after he leaves office in January.
We know that this is also about essentially trying to make sure that after the election, after Donald Trump leaves office, he still has a political
base that he can work with.
So there is more at work here than making these fraud claims. There seems to be an after presidency plan for Donald Trump here.
QUEST: Evan Perez, thank you.
Now the president-elect has a message for families struggling during the pandemic. Help is on the way.
The team, there it is, the economics team that Joe Biden has assembled to deal with the economic impact of the virus.
(COMMERCIAL BREAK)
[15:35:00]
QUEST: Joe Biden says he has one message to every American who's struggling to make ends meet. And that's help is on the way.
The president-elect has formally introduced his new economic team a short time ago.
It's headed by the treasury secretary nominee, Janet Yellen, who's of course the former Fed chair. And she says the U.S. is facing an historic
crisis.
(BEGIN VIDEO CLIP)
JANET YELLEN, U.S. TREASURY SECRETARY NOMINEE: The pandemic and economic fall out that together have caused so much damage for so many and have had
a disproportionate impact on the most vulnerable among us.
Lost lives, lost jobs, small businesses struggling to stay alive or closed for good. So many people struggling to put food on the table and pay bills
and rent. It's an American tragedy.
And it's essential that we move with urgency.
(END VIDEO CLIP)
QUEST: That's an urgency, perhaps not reflected on Wall Street where, as you continue to look at the numbers, markets are trading at record highs.
Whilst the head of the Chicago Fed tells me the real economy is screaming out for more support.
I spoke to Charles as in President Charles Evans earlier about the path to recovery.
He worked with Fed Chair Janet Yellen in the Central Bank and she'll be terrific in her new role.
CHARLES EVANS, PRESIDENT, FEDERAL RESERVE BANK OF CHICAGO: I had the high pleasure of sitting next to her when she was the San Francisco Fed
president until she become the vice chair in 2010.
She's always the most prepared person in the room. She always -- when I had a slightly different idea, she listened respectfully, usually challenged
sort of the weaker parts of it and I always felt like my arguments were better.
She's going to be terrific as treasury secretary, she was great as Fed chair. And I look forward to seeing her lead that area very strongly.
QUEST: There's not a huge amount of merit in talking about interest rates because, by your own statements and comments, there's going to be no
movement on interest rates for the foreseeable future. We could be looking back end of '23 before we see rates.
So instead we have to look at where the growth and the stimulus is going to come from for the U.S. economy. Where do you believe it comes from in the
next year?
EVANS: Well, Richard, I think that's a very astute comment.
[15:40:00]
I do believe that based upon our forward guidance that we're going to be sitting with the Federal funds rate at our effective lower bound [ph] of
zero to 25 basis points until we see the economy get closer to maximum employment and inflation up to two percent with it being on track to exceed
two percent.
And I think that's likely to take us into 2023 and perhaps beyond.
I think that important aspects of whether or not it will be quicker than that or longer than that will be whether or not we see strong fiscal
support.
There are very useful arguments that much of the country could stand to have additional relief during the current increased virus spread and the
risk that the economy faces.
Many parts of the economy are doing well but others are at risk because it's very difficult to have person-to-person contact.
So I think more fiscal support would help and, obviously, progress on the vaccines and getting that rolled out and being successful, that would also
be a huge impetus for continued growth.
QUEST: Are you frustrated that the inability of political leaders to come together to put together a stimulus package?
They might have all good party pre-reasons but, if you think about it, Chair Powell pretty much said -- walked in front with them with a red flag
and a whistle saying we need stimulus. Does this get you frustrated?
EVANS: I think as an economist looking at the economy and recognizing that monetary policy has already done a lot; when we're at zero, it's very
difficult to provide more accommodation.
We could provide additional asset purchases but we're already doing quite a lot. This is a real economic downturn, it's a public health safety crisis
and so that screams out for remedies other than monetary policy.
Fiscal support, relief for households that find it very difficult to get a job, get to work and do it safely if you're in that part of the economy.
And also, state and local governments are challenged by reduced revenues and additional needs to help support the economy.
So, yes. I do tend to think that on the merits people could come together and come to an arrangement where there was stronger fiscal support. That's
what we've argued for.
But those are political discussions and that's not really what I do for a living. So I just sort of look at it.
And I hope we don't repeat the difficulties that we experienced in 2012 and 2012 when we had disagreements over the debt ceiling, there was more
austerity, there was reduced government spending.
And it was nothing like the strong 1980s economic growth where there was generous, tremendous government spending during that period that led to a
much stronger recovery from a 10 percent unemployment rate in '81 and '82.
So I think fiscal support has been important historically and something stronger than what we experienced in the mid-2000s, 2010s would be good.
QUEST: Final question, sir. And you can take this one however you like. As the U.S. looks forward to a new administration in January, what will you
most be looking forward to about the new team that's taking over?
EVANS: Like I say, I've worked with Janet Yellen and I have high regard for her, I'm sure that she's going to be terrific.
They will put together a of other economists; by the names they all have good credentials from their previous experience.
I think working together with people in Washington to find the right remedies, to find a balance so that everyone in the United States can
benefit from strong persistent growth. That's what everybody cares about.
And I hope they're successful, I hope we're all successful.
QUEST: That's President Charles Evans of the Fed, the head of the Chicago Fed. And more top central bankers on QUEST MEANS BUSINESS.
Tomorrow, an exclusive interview with the former Bank of England Governor, Mark Carney. Wednesday at 3:00 pm New York -- excuse me, New York, 8:00 pm
in London.
And of course, we'll all be discussing Brexit and the covid economic situation, what needs to be done.
In a moment, a CNN exclusive. Leaked documents revealing what China knew early in the virus pandemic and then downplayed the crisis.
(COMMERCIAL BREAK)
[15:45:00]
QUEST: CNN has obtained leaked documents from inside China that reveal the missteps and chaos of its early response to the coronavirus pandemic.
The documents are from Hubei Province which, of course, is -- where the city of Wuhan where the pandemic is thought to have begun.
Now the documents share the authorities released misleading public data on the number of deaths and cases and took, on average three weeks to diagnose
new cases. And much more.
CNN's Nick Payton Walsh reports.
(END VIDEOTAPE)
NICK PATON WALSH, CNN CORRESPONDENT: An unprecedented leak of internal Chinese documents to CNN reveals for the first time what China knew in the
opening weeks of the COVID-19 pandemic but did not tell the world.
A whistleblower who said they worked inside the Chinese health care system shared the documents with CNN online which show a chaotic local response
from the start.
YANZHONG HUANG, SR. FELLOW FOR GLOBAL HEALTH, COUNCIL ON FOREIGN RELATIONS: This lack of transparency sort of also contributed to the crisis.
DR. WILLIAM SCHAFFNER, PROFESSOR, VANDERBILT UNIVERSITY MEDICAL CENTER: Seeing information in black and white was very revealing and instructive.
PATON WALSH: CNN has verified them with a half a dozen experts, a European security official and using complex digital forensic analysis looking at
their source code.
The documents provide a number of key revelations about the province of Hubei, home to the epicenter city of Wuhan.
Firstly, some of the death tolls were off. The worst day in these reports is February the 17th where these say 196 people who were confirmed cases
died, but that day they only announced 93.
China was also circulating internally bigger, more detailed totals for new cases in Hubei, for one day in February recording internally nearly 6,000
new cases.
Some diagnosed by tests, others clinically by doctors and some suspected because of symptoms and contacts, but all pretty serious.
Yet publicly that day China reported nationwide about 2,500 new confirmed cases, the rest were downplayed in an ongoing tally of suspected cases.
That meant patients that doctors had diagnosed as being seriously ill sounded like they were in doubt. But it later improved the criteria.
DALI YANG, PROFESSOR OF POLITICAL SCIENCE, UNIVERSITY OF CHICAGO: If China had been more transparent and also more aggressive in responding, clearly
that would have had an impact on how much the virus spread in Wuhan, in Hubei, in China and perhaps to the rest of the world as well.
PATON WALSH: Strikingly, the documents reveal one possible reason behind the discrepancy in the numbers.
A report from early March says it took a staggering 23 days on average from when someone showed COVID-19 symptoms to when they got a confirmed
diagnosis.
[15:50:00]
That's three weeks to officially catch each case.
HUANG: This information seems to be very surprising to me because normally it would take just a couple of days.
SCHAFFNER: You're making policy today based on information that already is three weeks old.
PATON WALSH: Perhaps the most remarkable revelation concerns early December, the moment when COVID-19 first emerged in China.
Startlingly, these documents reveal there was an enormous spike in influenza cases in Hubei right when studies have shown the very first known
patients were infected with COVID-19. Twenty times the number of flu cases compared to the same week the year before.
Experts said it could have flooded the hospital system with patients sick from flu-like symptoms, making it harder to spot the first cases of COVID-
19.
The documents don't link the outbreak to coronavirus's origins directly but they show flu patients were regularly screened and many did not have a
known flu virus strain, leaving open the possibility they were sick with COVID-19.
HUANG: The spike in Wuhan was very unusual compared to previous years, so that would raise a red flag.
SCHAFFNER: It was very, very sizeable. It's clear that the Chinese virologists can make precise diagnoses of influenza. But in retrospect,
you have to wonder, was there some COVID in there masquerading as influenza?
PATON WALSH: The documents also showed the flu outbreak was biggest that first week in December, not in Wuhan but into other cities nearby in Hubei.
All valuable information in the hunt for where the disease came from.
Chinese officials have said the outbreak began here, the Huanan seafood market in Wuhan in mid-December.
And despite Western accusations that it has limited its cooperation with the WHO investigation into the virus's origins, China has insisted it has
been as transparent as possible over the coronavirus.
HUA CHUNYING, CHINESE FOREIGN MINISTRY SPOKESWOMAN (Speaking in Foreign Language)
PATON WALSH: For some time now, in order to shift the blame, she said, some U.S. politicians have constantly used the pandemic and other issues as
a pretext to smear and demonize China and sow lies and misinformation about China.
This will, of course, seriously mislead citizens of the United States and some other Western countries' understanding of the truth of China's
epidemic.
PATON WALSH: China's foreign ministry and health officials in Beijing and Wuhan have not responded to our request for comment.
This disease has killed nearly one-and-a-half million people, about a fifth of known deaths in America.
These documents a rare, clear and open window into what China knew all along. Trying to appear in control, while a local outbreak turned into a
global pandemic.
(END VIDEOTAPE)
QUEST: Nick Payton Walsh. The problem, Nick, is that China will do everything, as your report says, to obstruct the WHO from getting -- and
other countries, from getting to the bottom of how this thing started.
PAYTON WALSH: To some degree, yes. Although the WHO has just said last week that it's had reassurances it can get field teams on the ground. But
that hasn't happened yet. And you do have to wonder why.
Given the enormous scientific focus on where this virus originates from, why the key data points weren't shared earlier, haven't already been handed
over.
These are just a part of a mosaic here. These are a select number of files, not the whole thing.
And I think there possibly is a wider issue here. Yes, China could have helped other countries by sharing its mistakes, its experience as it first
encountered this disease and had an awful lot of understandable problems diagnosing and working out what was going on.
But there's a bigger image problem for China here too. It wants to say that its authoritarian, decisive, effective system was the way to handle
this pandemic.
They say they're in a better position because of that decisive action, democracies dithering about face masks, et cetera.
QUEST: Right.
PAYTON WALSH: These show that there was miscounting, misinforming, misreporting, misdiagnosing at the beginning that was essentially covered
up. A weakness in the system, not a strength. Richard.
QUEST: Now Nick, finally, briefly. This idea that the whole thing started by one person eating a bat that had converted the disease and therefore
there was the transmission. Is that what the latest thinking is?
Is it as straightforward as that, if we were able to, we could trace it back to one person?
PAYTON WALSH: We simply do not know where this all began and I cannot give you a clear answer on that.
What we do know is the most authoritative study we've seen, the Lancet, suggested that the first patient was on December the 1st.
And that study did not seem to suggest that that first patient had a direct connection to the Huanan seafood market you've seen there.
[15:55:00]
Quite how they got it is now addressed in that study and there's been a lot of speculation as to how it could possibly have been somewhere else
beforehand.
But this is so important, Richard, to get to the bottom of because it stops it potentially from happening again. Mankind is ravaging past the planet
[ph] where it hasn't been before.
So that kind of zoonotic transfer between animal and man is so much more possible. We have to do what we can to try and stop it. And that's where
the WHO investigation comes in, Richard.
QUEST: And I saw of your -- some excellent investigating work on that. Thank you. Nick Paton Walsh joining us.
We will take a "Profitable Moment" after the break.
(COMMERCIAL BREAK)
QUEST: Tonight's "Profitable Moment". We spent a great deal of the program talking about the hope versus the reality.
And the hope is now focused on the vaccine. And the vaccine we know -- whether or not -- look, by this time next -- well, obviously by this time
year -- but probably by the middle of summer next year, early late summer, most people in the developed world that want a vaccine will have been able
to get it.
That's the hope and it'll probably turn into -- but we've got to get there.
And that means getting through the winter. And that means getting through the winter without creating systemic and/or structural damage that can't be
repaired once things get going again.
The other night I was having dinner just in New York, with some friends, COVID, of course, and socially distanced. And it was outside, it was cold.
But I just noticed the number of restaurants that aren't even in business. And that's what we have to prevent. We have to prevent more damage being
done before the cavalry arrives in the form of the vaccine.
And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York.
Whatever you're up to in the hours ahead -- I forgot to bring the bell, I'll have to do it myself -- ding -- I hope it's profitable.
I'll have the bell and I'll see you tomorrow.
This is CNN BREAKING NEWS.
JAKE TAPPER, CNN HOST, THE LEAD: And welcome to THE LEAD, I'm Jake Tapper.
A new blow to President Trump's wild and baseless claims that the election was rigged. That, of course, is a claim based on no credible facts or
evidence.
This afternoon, yet another Republican official, this one has been very loyal to President Trump is risking Mr. Trump's wrath by making a factual
assertion about the integrity of the 2020 election.
END
