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Quest Means Business
Russian SolarWinds Hackers Strike Again; Daimler Poised to Lead Decarbonization Transition; AMC Shares Volatile to Finish Blockbuster Week; Senate Republicans Block Inquiry On Capitol Riot; Germany Formally Recognizes Colonial Genocide In Namibia; Around 400,000 Displaced After Fleeing Volcano Threat. Aired 3-4p ET
Aired May 28, 2021 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:21]
ISA SOARES, CNN HOST: The Dow is up to finish off the trading week and it has gained around one percent since Monday. Let's have a look at the big
board for you; 117, just over three-tenths of a percent. Those are the markets, and these are today's main events for you.
The Russian hackers behind the SolarWinds breach are at it again, this time, hitting USAID groups.
Russia has a new explanation for why it is stopping some E.U. airlines from flying to Moscow.
And Neymar hits back at Nike after it reveals why they dropped him from an endorsement deal.
Live from London, it is Friday, the 20th of May. I'm Isa Soares, and I, too, mean business.
Good evening, everyone. Happy Friday. Hope you are well. Tonight, we are starting with Microsoft because it says the hackers behind one of the worst
government data breaches in U.S. history have struck again.
The software giant has detected a cyberattack launched from Russia against more than 150 organizations and government agencies right around the world.
Many of the targets are involved in international development, humanitarian aid and human rights work.
Now, Microsoft says the hackers are the same ones who carried out the devastating SolarWinds attack, if you'll remember, last year.
Now, in terms of the method, this type was particularly brazen. They sent what appeared to be an official U.S. government e-mail. To do so, the
hackers got inside an e-mail vendor used by U.S. agency for international development. From there, they were able to e-mail about 3,000 people at
NGOs, human rights groups and think tanks in at least 24 countries.
These e-mails looked authentic as you can see there, but they included a link to malware that could compromise entire computer networks as you can
see there, download, view documents.
Now, notably, they targeted the types of groups that are too critical of Russia and its President, Vladimir Putin. This latest cyberattack shows
really the Kremlin has been undeterred by the countermeasures coming from the Biden administration.
Let's get more on this story. Matthew Chance is in Moscow for us. Matthew, good to see you.
You know, I heard one security expert, Matthew, today describe it as cyber- espionage rather than a cyberattack. Talk us through the details as given to us by Microsoft rather than coming from the U.S. government in
particular.
MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes. I mean, I think it's semantics when it comes to whether it is a cyberattack, whether
it is espionage, the point is, it was part of a campaign, according to Microsoft, that's been ongoing to try and accumulate information from U.S.
government agencies and from NGOs and think tanks that are associated with human rights and who may be critical, as you pointed out of the Russian
administration and of Vladimir Putin and his regime.
I think it's the timing of this that is most striking about this latest hack. I mean, there has been many hacks in the past, but it is just a
couple of weeks now until President Putin and Biden are going to sit face- to-face together in Geneva, in Switzerland. They have arranged that much anticipated Summit.
And there is already a list as long as your arm when it comes to fraught issues, historical hacking, the military buildup in Ukraine, the latest
crisis with the forcing down of an airliner in Belarus, the treatment of dissidents in Russia, the holding of American citizens in Russian jails.
These are all things that were going to be points of contention between the two Presidents and now, they have got this as well, which is something
frankly, neither side needed.
But it is also interesting timing-wise because it comes so soon after the United States passed or imposed very stringent sanctions to prevent exactly
this sort of thing from happening, and in response to something exactly like this, apparently according to Microsoft, by the same hacking group,
backed by the SVR, which is Russia's foreign intelligence service, that were responsible for the SolarWinds hack, which was a slightly different
attack, but it was still something that came from Russia backed by the SVR, according to U.S. Intelligence Services.
There were ten diplomats expelled from the U.S. because of that. That sanctions on individuals imposed who were associated with it and sort of
quite cutting economic sanctions more generally imposed by the United States as well.
But it doesn't seem to have changed the Russia behavior at all.
[15:05:00]
SOARES: It hasn't changed the Russian behavior, you've clearly stated that, but what does Russia, what's the Kremlin saying as it hears these
allegations coming from Microsoft.
CHANCE: Well, I mean, whenever the Russians are confronted with allegations like this, they tend to give the same kind of response, which is a
categorical rejection, and that was the same this time.
I mean, earlier today, Dmitry Peskov, on a conference call with reporters here in Moscow, was asked by CNN, actually, you know, what his response
was? He said, look, I've got all these questions that need to be answered. How did Microsoft link it with Russia? You know, why did this attack take
place?
Until those questions are answered, he said, you know, we're not going to give an official response. I feel that he didn't think it would make much
difference to the fact that this Summit is going to take place in a few weeks.
SOARES: Yes, this Summit is going to be anything, but slightly awkward. Matthew Chance for us in Moscow. Thanks very much, Matthew. Good to see
you.
Now these hackers go by many names. Microsoft calls them Nobelium malware from this group can be traced, though back to at least 2008. The SolarWinds
hack last year that Matthew was mentioning, was remarkable for its sophistication, as well as stealth, infecting 16,000 computer systems right
around the world.
It prompted U.S. President Joe Biden to impose sanctions that Matthew mentioned and expel Russian diplomats, clearly not deterred.
Now, since March, they've been engaged in this e-mail phishing scheme. It's much more basic than SolarWinds hack, but the targeting of a government
account really represents a clear escalation.
John Hultquist is the Vice President of Analysis at FireEye Mandiant. He is in Washington. John, great to have you with us.
You know, we showed our viewers what that e-mail looked like, and I looked at it earlier and it looked a bit like a bait, kind of like a phishing e-
mail, but you know, you'd have to click on this button. You can see it there, "view documents." It always seems too good to be true. Clearly
highly targeted, what's your take on this latest attack?
JOHN HULTQUIST, VICE PRESIDENT OF ANALYSIS, FIREEYE MANDIANT: Well, this is pretty much what we've been seeing for years from this operator.
You know, SolarWinds was kind of a -- it was extremely sophisticated. It was a very stealthy, disciplined operation. But by and large, what we've
seen from these guys, for so long, the SVR has been these spear phishing attacks that often go after diplomats, the military, the defense industrial
base, critics and think tanks and that's exactly what this is.
This is good old-fashioned espionage. These are the kinds of targets that have been the people that have been targeted by espionage for many, many
years.
SOARES: I remember -- I think I remember reading from the Microsoft President, he described the SolarWinds attack as the largest and most
sophisticated attack the world has ever seen. Would you call this one sophisticated, John?
HULTQUIST: I would say it's kind of run of the mill. It certainly pales in comparison to SolarWinds. It was, and a lot of you know, you might think
it's brazen. They knew that they were going to see this. They hit so many targets.
It's unlikely that we could have missed this, and we're going to know who's behind it. So, I mean, there was, you know, I think this is a signal that
it's not going away, and cyber espionage is not going away. There's no way to deter it. States use this as a tool to prepare for the unknown.
And right now, coming from Moscow, is this upcoming Summit. I would not be surprised if they are using this to answer those questions.
SOARES: Well, let's talk about what can be done? How this can be prevented, both from a political as well as a corporate perspective. Let's talk about
on the political front first. Sanctions, as our Matthew Chance in Moscow was saying had been applied, it seems that it hasn't, you know, hasn't
deterred them. So what can Joe Biden do more?
HULTQUIST: Well, there's a difference between espionage and a lot of the other activity that crosses the line. I think there's an expectation in
Russia that everyone carries out espionage as that, you know, as an American citizen, I expect my government to be carrying out espionage
against Russia in the same way.
So attempting to deter them from doing that. It's just -- it seems very unlikely that we're going to ever reach that goal. What we can do is put
some limitations around that espionage.
Are they carrying out attacks, disruptive and destructive activity? You know, recently, we obviously had a very big rush in the United States with
a major ransomware incident. Can we put limitations on that? But you know, when it comes to just doing espionage, we should probably expect that it's
going to continue to go on. We'll probably have to focus more on the counterintelligence, the solution side of the problem.
[15:10:03]
SOARES: What about from the corporate perspective? Because it almost seems that we're constantly -- the companies are constantly on defense. What can
they do? I mean, how behind the curve are some of these companies?
HULTQUIST: Oh, I think, you know, these are actors. You know, sometimes they catch us unaware, but we know a lot about them. We know a lot about
how they operate. When this incident happened, I think people who had seen SolarWinds were really surprised by it.
But there are a lot of us who work in the Cyber Intelligence field who weren't surprised. We've seen these actors before. We recognize this
behavior, and we can help you defend against this type of thing.
They're not all going to be these black swan events like SolarWinds. This type of event was readily defendable. We can actually prevent stuff like
this.
SOARES: John Hultquist, really appreciate you taking the time to speak to us today. Thank you very much, John.
Now still to come, the CEO of Daimler tells Richard Quest, he is ready to lead in the transition to electric vehicles. We have more of the exclusive
interview next.
And it's Wall Street Bets, the sequel. The Reddit fueled frenzy takes another stock to dizzying heights. Clare Sebastian explains next.
(COMMERCIAL BREAK)
SOARES: Now, the CEO of Daimler tells CNN he is ready for his company to be a leader in electric vehicles.
Speaking exclusively to our Richard Quest, Daimler CEO says he is optimistic about the growth of the company and steadfast on a commitment to
sustainability. Thank you.
(BEGIN VIDEOTAPE)
OLA KALLENIUS, CEO, DAIMLER: Well, we think that the growth rates in most economies, especially in the second half of this year, are going to go up
significantly. Of course, you have to compare to a lower base in 2020.
But there is a tailwind from the economic side and that is why in terms of demand, we look favorably upon the rest of this year.
RICHARD QUEST, CNN BUSINESS HOST: The mix and the speed with which the transfer to EV -- to full EV. Countries are bringing down the date ever
closer. How much of a challenge is this for you now?
KALLENIUS: We made a clear commitment two years ago as a company with our emission 2039 that we want to decarbonize, be a carbon neutral company 10
years ahead of the Paris Agreement.
If we look at the momentum in the market, this year alone, we're launching four full electric new models.
[15:15:10]
KALLENIUS: I think now, as this progress is picking up momentum, that 2039 in terms of full decarbonization is probably the most conservative
scenario, and we want to be one of the companies that are leading from the front in this transition.
QUEST: What do you need from policymakers to help make this -- to help make this transition smoother or at least not as difficult?
KALLENIUS: Well, our strategy is clear. We're going zero emission. So for passenger cars, that means the electric vehicle. How do we make this work?
And how do we make this attractive to customers?
The product side we will take care of, but we need a quick buildup of infrastructure around the world, so that the convenience factor of electric
mobility doesn't get lost, that you can really charge not just at home or at work, which are, at the moment, the two most common use cases, but
really have public charging infrastructure built up around the world.
QUEST: How concerned are you about the economic situation in your home country, in Germany. There will be a change in leadership. There seems to,
when Angela Merkel steps down, there seems to be an element of confusion, or at least uncertainty, I would say over a replacement, and whilst I'm not
necessarily asking you politically, I am asking you economically how worrying are you -- worried are you?
KALLENIUS: Coming out of the pandemic, and now, we can of course, see light at the end of the tunnel, even though E.U. as an economic region is
slightly behind China and the United States in terms of coming out of this, we expect growth here as well. And the German industry is strong.
Of course, much of it is based upon experts, so tailwinds from markets like United States and China that would help us. But I would like to look at
this as a glass half full that now that we hopefully can put the pandemic behind us soon, that we are going to look at very reasonable growth here in
the next few years.
QUEST: I know CEOs will tell me immediately and I know bosses will tell me and Chairman will tell me it's a team effort. But one of the things I'm
trying to discover from those in the C-suite is what did you learn about yourself, and your management style?
KALLENIUS: I can confirm what you said, it is a team effort. When a company or a whole economy, or a whole society hit the crisis, very often good
teams come together. That's what happened at Daimler and people around the world rose to the occasion.
For myself, sometimes they use the expression, it's lonely at the top. Now it was not only lonely, but you were actually physically lonely in the
office because everybody else was in a home office or vice versa.
And next to the crisis management, actually, one thing that was, I think, a positive side effect for somebody in a leadership role. As you don't lose a
lot of time on logistics and travel, I had a lot of time in the evening to think, to think about our strategy, refine our strategy and actually look
at what's really important for this company. And it's in stress test situations, it's almost like you're given a gift to stand back and refocus
how are you going to do business afterwards?
QUEST: Do you see any strategic changes as well? Not now, because obviously, it's in the middle of the year. You're just coming out -- you're
still coming out the crisis, but did anything come from this process that you think another year or two and I'm going to start moving doing this?
KALLENIUS: I think strategically for us, what did the thinking process lead to? It really was to look at what are the strengths of this company? And
how can we strengthen the strengths? How can we make sure that we deliver the brand promise what Mercedes is all about? And for us, it is two things
that we have, I would say, refocused on. On the one hand, we're a tech company. We're an innovation company. There, it is all about the
transformation into electric mobility and software.
But we're also the original luxury company in the auto industry. So we said, let's do the two things that we know how to do best: innovative
technology and focus on the modern luxury sustainable modern luxury promise of the future and that's what we're going to do.
(END VIDEOTAPE)
SOARES: Richard Quest speaking to the CEO of Daimler now.
It is showtime for AMC Entertainment. The company's shares are flat now, really, after -- you can say after a roller coaster trading day earlier
today, down almost, well three and a half percent or so.
Investors are taking some profits after the share price popped more than 120 percent this week. Look at that rise.
[15:20:10]
SOARES: The monster rally isn't based on fundamentals though. The movie theater chain expects to lose money this year, as well as next.
Let's try to make sense of this, Clare Sebastian is following the popcorn worthy story from New York without the popcorn. Clare, why are we seeing,
you know, AMC shares soaring this week? What really is behind the surge?
CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes, Isa, as you said, not really anything to do with the company itself. This seems to have been
driven as we saw in January, by social media users, the Reddit group, Wall Street Bets.
We've seen a lot of chatter on there this week talking about AMCU going to the moon, YOLO is something they say a lot and it makes me feel very old. I
think one of us at least had to Google that this week.
So that's the social media aspect that's similar to what we saw in January. There's another really interesting aspect of this, and that is if you look
at the sort of the charts of AMC so far this year and compare it against Bitcoin and other cryptocurrencies, we see that as the sort of meme stock
rally faded in January, that was really when the crypto rallies really started to take off.
And similarly, now, as we see some of the gains around crypto fading a little bit, this is when we've seen this next sort of retail meme stock
rally.
It seems that that perhaps some of the same money is at play there. And the other thing to talk about here, Isa, is the short squeeze. So obviously, we
saw that in in January, several hedge funds were burned by the meteoric rise of these meme stocks, and we've seen that again this week.
According to financial analytics firm OTEX, short sellers have lost in the first four trading sessions of this week, $1.9 billion and $1.3 billion of
that from AMC alone. Now today, though, we are seeing a bit of a reversal of that, they just announced that they're actually seeing more short
interest in AMC today.
So, like the rally seems to be fading a little bit. It seems that many people are still betting on that stock going down.
SOARES: And what I take away from this segment, your wonderful report is YOLO. I actually have to be honest, I had to Google it when you WhatsApp'ed
it to me. So, thank you for that.
I felt very, very old. Clare Sebastian there for us. Thanks, Clare. Good to see you.
Now let's take you out to the restaurants in the U.K. roaring back to life now that they have reopened for indoor dining. The restaurant booking
website, as you probably know, Open Table recognize it, says reservations are up nearly a third compared to the same week in 2019.
Open Table says the number of diners globally is still about 11 percent below the pre-pandemic level. Along with the U.K., the company tracks
restaurant data from the U.S., Australia, Canada, Germany, Ireland, and Mexico.
The U.K. and Australia are leading that recovery.
Debby Soo is the CEO of Open Table. She joins us now via Skype from Hillsboro, California. Debby, thank you very much for being with us.
I have no doubt that this weekend may be a very busy weekend for you, Memorial weekend. What are you expecting? Paint us the picture.
DEBBY SOO, CEO, OPEN TABLE: We are expecting dining to continue to make the comeback that it started to. As you alluded to earlier, U.K. is looking
really great as is the U.S. This week in the U.S. was the first time we saw dining activity exceed pre-pandemic levels.
Reservations for this upcoming Memorial Day weekend here in the U.S. are looking really strong. So, the comeback is happening, and I couldn't be
happier about it.
SOARES: Great. It's wonderful to hear that given everything that the restaurant industry has gone through globally. Debby, though, give me a
sense of what you're seeing on bookings, reservations on Open Table right now and how these compares, for example, pre-pandemic, if we're talking
like globally here.
SOO: Globally, we're seeing about 70 percent of the restaurants that were on Open Table prior to the pandemic are currently open and accepting
reservations. That's a global number. In the U.S. that number is about 80 percent, and the data really varies depending on what market and what
country you're looking at.
Germany, Canada, are still looking quite down year-over-year or compared to pre-pandemic levels. U.S., the U.K., Australia, parts of Mexico looking
really, really good.
SOARES: Of course, during lockdown, you know, we heard so much Debby, about restaurants, you know, simply unable to survive. Many didn't do takeaway,
takeout? So, I'm curious to hear from you. How many restaurants on your platform have come back? How many haven't? How many have closed? Shut up
shop completely?
SOO: At the onset of the pandemic, we predicted that one in four restaurants would not be able to survive the virus, and looking back now,
we stand by that number. Unfortunately, there were, you know, a large percentage of restaurants that just weren't able to make it through.
The ingenuity and innovation that we see from restauranteurs gives me a lot of hope and confidence that new restaurants will emerge and be on Open
Table's platform, but it's very sad to see the restaurants that haven't been able to make it.
And we're not quite out of the woods yet, so we are seeing dining activity come back in markets like the U.S. and the U.K. But even here in the U.S.,
restaurants are now grappling with other challenges, trying to reopen, finding the talent and the staff for the reopening and going back to, you
know, full capacity. So it's not over yet. There's a lot that the industry is grappling with. And we hear that all the time, you know, on calls and
meetings with restaurants.
[15:25:39]
SOARES: I'm glad you mentioned that, you know, almost kind of the obvious in many ways that we're not out of the woods. Vaccination in the U.S. and
in the U.K. going in an incredibly good pace, but what's the sentiment around risk? Do customers feel safe to return? What have you gathered data
wise?
SOO: We recently conducted a survey with the James Beard Foundation in monitoring how diners are feeling about going back to the restaurant and
their dining habits, and safety is still a major concern for diners and restaurants as well.
And so, we at Open Table have a product feature called Safety Precautions where restaurants can very clearly list out all the safety precautions they
are taking -- mask wearing, table distancing, disinfecting tables, et cetera, and you know, we still see a lot of usage and consumption of that
data.
So, people are still worried about safety even as they're getting vaccinated, and vaccines are becoming more widely available. And we don't
think that that's a trend that's going to go away.
I think you know, COVID has shifted our thinking in health and safety and that's probably going to stay for a while.
SOARES: Debby Soo, great to have you on the show. Wonderful to hear that restaurant are starting to open back up. I wish we had more time. I really
appreciate you taking the time to speak to us here on QUEST MEANS BUSINESS.
Now, after the break, Lufthansa CEO, Carsten Spohr shares his lessons from aviation's greatest crisis. He says confidence was key to getting his
airline through the pandemic. I'll bring you that interview, next.
(COMMERCIAL BREAK)
[15:30:23]
SOARES: Hello, I'm Isa Soares. There'll be more QUEST MEANS BUSINESS in a moment when Nike explains why it ended its big money sponsorship deal with
football superstar Neymar last. We'll speak to the journalist who broke the story. And one of YouTube's earliest viral videos takes a bite off out of
the NFT market. I'll be joined by the stars of Charlie Bit My Finger. Before that the headlines for you this hour.
The U.S. Senate has failed to pass a bill creating an independent inquiry to investigate the deadly January the 6th Capitol Hill riot. While six
Republican senators voted in favor of the Commission. The measure didn't reach the 60 votes needed to advance. The January insurrection left five
people dead, and 140 police officers injured.
Germany has formally recognized as colonial era atrocities against two ethnic groups in Namibia as genocide. Its troops killed up to 80,000 people
in the early 1900s. In response to an uprising against German rule. Germany says it will give Namibia $1.3 billion to aid reconstruction and
development efforts.
Around 400,000 people have fled their homes in the eastern Democratic Republic of Congo. Over worries of nearby volcanoes could erupt again. At
least 31 people died after the first eruption on Saturday. One humanitarian group is also warning the evacuation could be complicated by widespread
violence and an ongoing hunger crisis in the country.
Now, the Belarusian President Alexander Lukashenko was in Sochi, Russia to talk about his diversion of a Ryanair Jet with Vladimir Putin. You remember
that right? Well, Russia has now allowed Austrian Airlines to bypass Belarus as it flies from Vienna to Moscow. It denied a similar request by
Air France and caused the decision to ban flights over Belarus irresponsible. Fred Pleitgen is following the story in Berlin for us.
FRED PLEITGEN, CNN INTERNATIONAL CORRESPONDENT: As international condemnation mounts against the regime in Minsk and specifically against
Belarusian strong man Alexander Lukashenko. Lukashenko paid a visit to Vladimir Putin in Sochi. And obviously, the incident with the Ryanair
airplane and the Belarusian authorities forcing that plane to land was certainly one of the things that was on the agenda.
It was quite interesting because before that meeting even started, Lukashenko and Vladimir Putin could be seen together. And Lukashenko had a
briefcase next to the chair that he was sitting in. And he said that he had brought documents that he said, would clarify the situation. Now, it wasn't
clear whether or not he was specifically speaking about that incident. But incident certainly did come up of Vladimir Putin, for his part, at least
showing that he continues to support Alexander Lukashenko.
And that support is very important and seems to be very strong indeed. In fact, several Russian politicians have come out and said that they believe
that the explanations that Minsk has been offering up for forcing that jet to land that those are, as they put it, plausible, even as the
international community continues to punch holes in that narrative. In fact, CNN obtained an e-mail that was allegedly sent to the Belarusian
authorities.
And where they claimed that that was the reason why they told that jet to land because there was a bomb threat on board. But it turns out that that
mail was apparently sent about 30 minutes a little less, after the plane had already been told to divert. And in fact, European countries are
continuing to say that they believe that those explanations do not hold up. And they are vowing to take tougher action against Minsk. Fred Pleitgen,
CNN, Berlin.
SOARES: Now the CEO of Europe's largest airline says the pandemic has pushed governments to be even more protective of the aviation industry.
Speaking in an exclusive interview from Munich, Lufthansa Carsten Spohr told Richard how the COVID crisis pushed him to transform and speed up his
modernization plan. Take a listen.
(BEGIN VIDEOTAPE)
CARSTEN SPOHR, CHIEF EXECUTIVE OFFICER, LUFTHANSA: There is never an end to restructuring. There's never an end to optimization. There's never an end
of transformation. But this crisis indeed accelerated the way we transformed our company. And that's probably true for many others in the
industry as well. So, coming more digital, becoming more leaner, becoming more sustainable. I think these were transformation items which we fortunately started before the crisis, we accelerated within the crisis. We
will continue to work on after the crisis.
[15:35:11]
QUEST: Chairman, does Europe need to change its ownership rules? Do we -- does the industry need to -- just a couple more questions. Fundamentally,
so that you can buy and sell each other, you can consolidate, you don't have to have weird constructs there, and you can compete. Is that what's --
what needs to happen next for the industry?
SPOHR: Well, let me be honest on this one because this is one of the highly disputed topics for many years now. First of all, I think the COVID crisis
has somewhat paused consolidation. Many airlines including us who have received government stabilization packages are not allowed to do active
M&A. Also, governments will have restrictions on their airlines being taken over by others in higher degree than they had before the crisis because
they helped their airlines to stay alive.
And also, I think this unique crisis showed how important airlines are for the global economy, but also for the regional governments, countries,
economies, people. So I think we rather in a positive way, saw the importance of airlines, even more visibly than before. At the same time,
government protection of airlines probably has increased, not only for the time of the crisis. So, I think this is not years of consolidation ahead of
us, with the exception of some airlines leaving the market and other strong players taking advantage of.
QUEST: Finally, you're a pilot, you're used to dealing -- you're trained to deal with crises, you know, and you're trained that crisis are dealt with
through routines and procedures, not panic, and chaos. And what did you learn about yourself and your management style at the height of the crisis?
SPOHR: Confidence is key, you need to be confident as a pilot, about your aircraft, about your own skills, about the training the airline has given
you. And I think in our situation, we never lost the confidence in Lufthansa. Our customers never lost the confidence in Lufthansa. Our
governments didn't lose the confidence. Surely our staff management didn't. So I think that confidence is a very strong force especially in terms of
prices.
In a way it kept us together. And we never had a doubt that will eventually come out of this crisis in relative terms stronger than any others. And we
will bring as many people as possible through this crisis. I think that was quite even the positive experience to feel their strength, the company that
sticking together in the company, which may be without the crisis, you wouldn't have felt the same way.
QUEST: And you never doubted.
SPOHR: I never doubted that we'll find a way out. There were doubts about the way we would get out. There were doubts about what the optimum ways and
discussions with others and of course with the government, so yes, they were doubtful days. There was never the ultimate doubt that Lufthansa which
is now celebrating more than 100 years of the crane which you see behind me. There was never a doubt that we did not somehow get this company
through this crisis now.
(END VIDEOTAPE)
SOARES: Richard there speaking to the CEO of Lufthansa. Now, Nike explains why it cut ties with one of its biggest sports stars. And (INAUDIBLE) and
Neymar is firing back. We'll bring the details next.
(COMMERCIAL BREAK)
[15:41:13]
SOARES: Football superstar Neymar is playing defense after Nike revealed it cut him for refusing to cooperate in the sexual misconduct investigation.
Now the (INAUDIBLE) describe the claim on Instagram as "absurd and a lie" you're seeing it there. Writing in there he didn't know he was under
investigation. Now Nike says it cut Neymar last year from -- for stonewalling what it caused a good faith investigation of credible
allegations of wrongdoing.
Its investigation was inconclusive. The company added the following. It would be inappropriate for Nike to make an accusatory statement without
being able to provide supporting facts. A rep for Neymar said the footballer denies the allegations and would, "vigorously defend himself"
against these baseless attacks. While our guests broke the original story on Nike and Neymar. Wall Street Journal reporter Khadeeja Safdar joins us
now from San Francisco via Skype.
Khadeeja, thank you very much for joining us tonight. You know, I was reading your article and what struck me was that Nike didn't publicly give
a reason for an early end to his endorsement deal back in August I think of 2020. But it has done so since. Why did it take so long?
KHADEEJA SAFDAR, WALL STREET JOURNAL REPORTER: So, Nike never intended to give a public statement. I wrote the story. And I reported it out based on
sources and documents. And Nike confirmed the details that we had in the story in it was a response to the details that we presented to them. So why
is it like Nike came out and said all this?
SOARES: Right. No. Understood. But Khadeeja, is your sense that this has been brewing for some time? I'm just trying to understand if this didn't
happen in 2020. Why it's only, you know, why we only hearing about it now the decision only hearing about it now? Is this just like a sometime or is
it sudden?
SAFDAR: No, it's -- this is something that's been going on for a while. And this sources that I've been in touch with, quite frankly, I've been
surprised that it hasn't come out earlier. In 2020, Nike didn't disclose the reason as you said that it was ending a relationship with Neymar.
Neymar went over to Puma, a smaller rival, he had eight years left on his contract which we discovered, and they didn't disclose what happened at
that time why he was moving from Nike to Puma.
What we did -- what we discovered was that there was actually a sexual assault probe happening behind the scenes where Nike was looking into an
allegation by a Nike employee that Neymar had sexually assaulted her.
SOARES: Yes. And not only did Nike not come out with it sooner. Well, what I also read and correct me if I'm wrong here is that while this probe was
happening with this Nike employee over these allegations that Neymar disputes and denies. Neymar was still being used in some of the marketing
campaigns. Is that -- is that correct? This is 2019. I think it was a woman's World Cup. Correct me if I'm wrong here.
SAFDAR: So what happened was that they -- that was before the probe initiated that reference to that commercial. The woman -- the actual
incident happened in June 2016, based on sources in a New York hotel, a Nike employee that was tasked with coordinating logistics for Neymar and
his entourage. After the incident, she told friends and colleagues the night of the next day, and then the weeks and months after, and that -- the
universe of people that she told my understanding that those were Nike employees.
And then -- that included Nike employees. And then in 2018, she told the H.R. chief and general counsel. And then in 2009 when a -- another public
allegation of rape was made against Neymar, she approached the general counsel and H.R. again and that's when they started the probe.
[15:45:10]
SAFDAR: So not until they started the probe. So there was a time in between when she had made the complaint and when they started the probe that he was
continuing to be used in marketing. So that's correct.
SOARES: Right, yes. I mean, it's interesting because Nike, of course, has proudly embraced progressive politics and outspoken athletes. Do you think
yes or no that this made it untenable to keep Neymar on? What's your -- what's your sense here?
SAFDAR: What I can tell you is that in -- the -- over the course of conversations with Nike, the reason that came up that they gave for further
relationship ending was that it was -- because he didn't actually cooperate with the probe. He refused to -- he refused to be interviewed. So they felt
that that was the reason to terminate not necessarily the allegation or other factors that are the tipping point.
SOARES: Khadeeja, I really appreciate taking the time to speak to us. Thank you very much.
SAFDAR: Thank you so much.
SOARES: Now the fate of one of YouTube's biggest videos, OK, we'll fight. We'll hear from the now teenage stars, oh, yes, of Charlie Bit My Finger on
the future of the viral video. Both the boys and their father as you can see them will join me next. See you in a bit.
(COMMERCIAL BREAK)
SOARES: Turns out it was all bark but no bite. One of YouTube's biggest viral videos will remain on the platform after all.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Ouch. Ouch. Ouch, Charlie. Ouch. Charlie. That really hurts.
(END VIDEO CLIP)
SOARES: Well, Charlie Bit My Finger was uploaded. I'm laughing so much. I'd like to know how many times I've watched that clip in 2007 when YouTube was
just really a toddler itself. Since then, the videos had nearly a billion views. This week it was sold as in NFT nearly $61,000. The auction was held
by origin protocol which advertised the video as soon to be deleted. I'm joined by the now teenage stars of Charlie Bit My Finger, Harry and Charlie
Davies-Carr and their father Howard.
Gentlemen, good evening. Thank you very much to you -- to all of you really being here with us tonight. You must be thrilled, Howard. Let's start with
that, with the success of the auction. Did you expect it to go that well?
[15:50:11]
HOWARD DAVIES-CARR, FATHER OF VIRAL VIDEO STARTS: In short, no. I mean, it was lovely that it did what appears. We were happy. We watched it all the
way through. It was exciting. But, you know, we went in without any expectations. So, it was great.
SOARES: And Charlie and Harry, I mean, did you ever imagine -- we'll talk about the last 14 years and how it's been like living with that video? Did
you ever imagine that it would come to this?
HARRY DAVIES-CARR, START OF VIRAL VIDEO CHARLIE BIT MY FINGER: I mean, nothing to like the scale of NFT and how much it's sold for. I mean, it's
always been, you know, a cool thing that it's been on YouTube, and it's had 800 million views. And a lot of our friends talk about it. You know, it's
certainly a big part of our lives. But yes, we never expected it to go this (INAUDIBLE)
SOARES: Charlie, I mean, you really created something that is so part of -- it's really a part of our culture now. And I think just to let you know,
this week, my husband even came up with one line was Oh, Charlie Bit My Finger. It's just so part of a vernacular now. Did you ever imagine when
that happened in the years that followed, of course, it's been 14 years? What kind of questions were you asked if you've been asked to recreate it?
Give me a sense of, you know, your upbringing with this video, what it's been like.
CHARLIE DAVIES-CARR, START OF VIRAL VIDEO CHARLIE BIT MY FINGER: Yes. So obviously, it all happened when I was about one years old and Harry was
three. So I can't really remember the first initial years when it first went big. But we've definitely gone a lot of places and done a lot of
recreations with, you know, celebrities, we're just doing it with Harry. But yes, it's been really cool.
SOARES: What we don't know is -- what I read and correct me if I'm wrong, Howard is that the video you intended to actually email the video to the
United States, but because you couldn't, you uploaded it, is that correct?
HOWARD DAVIES-CARR: Yes. So in 2007, I think the file was something like 28 megabytes, maybe a little bit longer, bigger. It was too hard to e-mail
documents that size at the time, things like, you know, things like Dropbox, and we transfer and things weren't around either. So YouTube would
just come along and they sorted all of that out, uploaded onto YouTube. It was a really simple process.
SOARES: Yes. And Charlie and Harry, I'm guessing what we don't know. And how I can probably tell us a bit more is what happened after Charlie bit
his finger because the video stopped there. Howard, how was the reaction afterwards?
HOWARD DAVIES-CARR: So funnily enough, not only the video stopped there, the tape stop there as well. I mean, that is literally it. It -- the tape
it lasted 10 seconds less, you -- we wouldn't have had Charlie Bit My Finger.
SOARES: Would have missed that. Very quickly from both -- from both of you, boys. What are you going to do with the money?
HARRY DAVIES-CARR: Well, I mean, so far, still going too --
HOWARD DAVIES-CARR: Quickly. She said quickly.
HARRY DAVIES-CARR: All right. So first, we're going into education. And I think we'll continue to do so probably into like universities. So student
loans.
SOARES: Wonderful, very wise. Investment in education. And Charlie?
C. DAVIES-CARR: Yes. Like I said, everything that we've done so far has gone into education, mostly for our little brothers as well. We've got two
(INAUDIBLE) didn't mention, not so good. And yes, it will --
HOWARD DAVIES-CARR: (INAUDIBLE)
C. DAVIES-CARR: What? Yes, exactly.
HOWARD DAVIES-CARR: (INAUDIBLE)
C. DAVIES-CARR: And yes. I think that as well. My (INAUDIBLE) stuff. But yes, apart from that, stopping and going to education.
SOARES: Well, I think it's a wonderful investment. Thank you very much and congratulations. Wonderful to speak to you boys. Thank you.
HOWARD DAVIES-CARR: Thank you (INAUDIBLE)
SOARES: Now, from biting a finger to people. NFTs are one of the buzziest topics of today. Yet one artist in Dubai was on the trend long before
digital artwork has ever this -- was ever this fashionable. Kim Kelaita has more part of our Think Big series.
(BEGIN VIDEOTAPE)
UNIDENTIFIED FEMALE: So I'm going to press this here and then look into the thing right here.
And you tell me when you're ready.
UNIDENTIFIED FEMALE: He's ready. Let's go. Goodbye.
UNIDENTIFIED FEMALE: Oh, it's so cool.
UNIDENTIFIED FEMALE: 'm going to then full set up.
KIM KELAITA, CNN PRODUCER (voice-over): Forget a picture is worth a thousand words from Amrita Sethi, award is worth a thousand pictures. She
uses the technique she calls Voice Note Art.
AMRITA SETHI, AWARD-WINNING MULTIMEDIA ARTIST: It's me capturing a sound or word. So I say the word Dubai.
UNIDENTIFIED FEMALE: Dubai.
SETHI: And then each of the lines of the sound wave. I draw to match the meaning of the word
[15:55:05]
KELAITA: Amrita to left a career in finance two years ago to pursue her passion as an artist.
SETHI: 2020.
KELAITA: Her big idea is to digitize her voice note artwork and sell them as NFT's on the blockchain. She's says she's the first globally to do so.
(on camera): And so a banker but an artist, yeah, who was an artist by hobby, I'm sure.
SETHI: Yes.
KELAITA: And this kind of married both of your work.
SETHI: Yes. I would even add a third aspect to that. It's, you know, it's finance. It's odd. And it's technology as well.
KELAITA: Did you think you were going to make any money?
SETHI: If I'm honest with you, no, I did.
UNIDENTIFIED FEMALE: NFT.
KELAITA (voice-over): Aptly called what the NFT. Amrita's latest pieces were first venture into 3D animation.
UNIDENTIFIED FEMALE: A theory.
KELAITA: That was up on the blockchain.
SETHI: Yes.
KELAITA: Correct?
SETHI: Yes.
KELAITA: And did that sell?
SETHI: Yes, it did.
KELAITA: How much?
SETHI: Oh my god. It was a record-breaking amount for me It sold for $102,000. And I just --
(CROSSTALK)
KEALITA: Yes. Let the NFT. Amazing. Good for you.
UNIDENTIFIED FEMALE: The future.
KELAITA: NFT is in blockchain technology give Amrita the ability to take her art to a whole other dimension.
So cool. Though, in your opinion, is this how we're going to be looking at art in the future?
SETHI: With NFTs what's going to be happening is you're going to go into a much more immersive experience. It will no longer be a 2D, 3D experience.
We're going to be encompassed in such beautiful creativity that is going to blow all of our minds.
KELAITA: With the recent explosion of NFTs, artists like Amrita feel they finally have the means to fully express themselves.
SETHI: It was -- I feel like it's almost like NFTs were made for me.
KELAITA: Back on her computer, Amrita is already working on her next piece.
SETHI: OK. Let me do one more.
KELAITA: Kim Kelaita, CNN, Dubai.
(END VIDEOTAPE)
SOARES: Fascinating. What a crazy world. Amazing. There are just moments away for left on trade on Wall Street. We'll have of course the final
numbers and the closing bell right after a very short break. Do stay right here.
(COMMERCIAL BREAK)
SOARES: There are just moments left to trade on Wall Street. All three indices are set to close day highs. You can see it was a solid day for the
Dow. It's now up now some of two-tenths of one percent of 34,000. And close to the best of the day. In fact, investors are optimistic about the course
of the U.S. recovery after consumer spending rose half a percent last month. Mostly green across the Dow, Salesforce is in the lead up nearly six
percent.
Really a mixed day for the rest of the tech sector. Apple and Intel are down there. As you can see, Boeing is the worst of the day -- of the
sector, I should say. Apple, Intel is what -- no, actually, Boeing is the worst of the day. Well, so, a mix -- a mixed bag as you can see there.
[16:00:04]
SOARES: And that is QUEST MEANS BUSINESS. I'm Isa Soares in London. The closing bell is ringing in New York.
END
