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Quest Means Business

U.S. Inflation Remains At 40-Year High; Ukraine War Disrupts Flow Of Gas To Europe; Musk Says He Agrees With E.U. On Twitter Regulation; "Highly Likely" Finland Will Apply To NATO; Call To Earth: Under The Sea; Passenger Lands Plane; Dash To The Bell. Aired 3-4p ET

Aired May 11, 2022 - 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 INTERNATIONAL ANCHOR: So the market still unhappy, I'm not surprised. Perhaps we can take a look at the way the Dow is looking.

They've been digesting the latest inflation numbers. We'll get to them of course, in detail. Now. 32,000 is looking highly dubious in the next hour.

Well, it's already gone, there you are. That was quick, wasn't it?

We've got an hour to go and we'll watch the market. So we'll bring you up to date. The events of the day are all relevant.

Inflation may be peaking. It's still far too high for Central Banks. The latest data show a 40-year high.

Ukraine is cutting off some Russian gas supplies to Europe and accuses Moscow of stealing from its pipeline, and as the U.S. Senate is preparing

for an historic vote on abortion, the Treasury Secretary, Janet Yellen makes the economic case for keeping Roe v. Wade.

We're live in New York. Wednesday, it is May the 11th. I'm Richard Quest. Yes, I mean business.

Good evening.

Inflation in the United States is coming down, but not fast enough. That's the assessment from Wall Street as prices remain high close to a 40-year

level. U.S. inflation slowed last month for the first time since August. Now, look at the graph and you can see, there was a minor tick down.

Prices are continuing to rise. That's the important point. They're rising, but at a slower pace. Than new inflation numbers are weighing the market

down something dreadful. The NASDAQ, the growth stocks is getting the worst of it. Now off another two and a half percent.

By the way, I was just looking the NASDAQ is roughly down 25 percent. It's lost a quarter of its value since December of last year.

President Biden has given his take on the situation. He was visiting a farm in Illinois when he said the U.S. is facing two battles: Inflation and the

fight to help Ukraine. He emphasized the importance of farmers in the United States, while being sure to share the blame for the global food

shortages.

(BEGIN VIDEO CLIP)

JOE BIDEN (D), PRESIDENT OF THE UNITED STATES: America is fighting on two fronts, at home, this is inflation and rising prices; abroad, it is helping

Ukrainians defend their democracy and feeding those are left hungry around the world because Russian atrocities exist, and Jeff and American farmers

understand Putin's war has cut off critical sources of food.

(END VIDEO CLIP)

QUEST: Rahel Solomon is with me here in New York. The numbers -- so we're off the top of inflation, but the underlying. I mean, inflation -- the data

as I always understand it, it's not about the headline, it is what's underneath.

RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: Exactly. So let's go underneath, Richard. As one economist told me today, there is no upside to this report.

Yes, we saw a slight easing, but I want to take you to some of the categories in this report.

So when we look at what else is going up, the cost of food. That was up about nine-tenths of a percent. Shelter or essentially where you sleep at

night, your housing expenses that went up about 0.5 percent, and medical care went up about half a percent as well.

When we look at what's going down, put it in context. Energy prices went down about 2.7 percent; used cars 0.4 percent, and apparel 0.8 percent. But

Richard, it's really that shelter number, the cost of housing, rent, mortgages, that sort of thing that really has economists that I spoke to

alarmed essentially saying: Look, we know that the cost of rent has gone up about 20 percent year-over-year, same thing with housing costs.

So how do you square that, Richard, with what we've heard in other parts of the economy? From the airlines, for example, who some of which have

reported surging consumer demand that people are traveling and can't get enough? So how do you square those two things?

I want to read for you a quote from Diane Swonk, an economist, essentially saying that, look, "This is what inflation does, it divides. Even though

everybody feels inflation, not everyone suffers the same from inflation. What you're getting back to is a tale of two economies and inequality is

worsening."

QUEST: No, she is absolutely spot on, which is what Powell was saying, the Chair of the Fed, justifying the measures that they're going to have to

take, but I just want to take on -- I mean, we are now in a situation where how far, how fast is one thing, but how much damage is going to be done and

how much pain is going to be inflicted?

[15:05:09]

SOLOMON: Well, it seems like it's going to be some short-term pain, hopefully for some long-term gain. Look inflation impacts everyone.

Unemployment, a much smaller percentage. But yes, it is clear that the number one mandate, at least right now from the Fed is to fight inflation,

and so it's going to be some short-term pain, for sure.

QUEST: Right. Rahel, look at the markets today, please, with me, particularly, obviously, the growth stocks, the NASDAQ. We are down another

two and a half percent, three percent. So we're off 25 percent.

Now, I look at the graph, and I can see there is still a long way to go in terms of what these stocks have done over the last five to seven years, but

what is the market looking for in terms now of these stocks and these markets?

SOLOMON: Well, there are all sorts of metrics you can use, right? I mean, one analyst that I was looking at earlier said, you know, look at the 200-

day moving average, if you want to look at something more technical, all sorts of things you can look for.

But you know, I think what people might be hoping for is a return back to Earth. We saw especially with those growth names that you mentioned,

Richard, these stocks really soared during the pandemic and earnings being pulled forward. Now, they're sort of falling back down to Earth.

And so perhaps that pre-pandemic levels of earnings and pre-pandemic levels of growth, and maybe the valuations that they had achieved during the

pandemic, just really were not legitimate.

QUEST: We will talk more about this because the question in everybody's mind, myself included of course, who is looking at is, where is the bottom

in this market? Thank you, Rahel Solomon.

Ukraine says it has been forced to shut off some of the Russian gas that it gives to Europe. The pipelines crossing Ukraine have remained open

throughout the invasion. Now Ukraine is accusing Russian forces of interfering with their operations and diverting some of that gas.

In response, the gas has been closed at the transit point that handles a third of the exports, or nine percent of natural gas used in the E.U. and

Britain comes through that pipeline.

Anna Stewart is with me. I guess, I suppose the first thing I was surprised at is that those pipelines were still operating at all, bearing in mind

that it is Russian gas traveling across the country, but then I guess also Ukraine gets money from the transmission of it.

ANNA STEWART, CNN REPORTER: It does. I think it was very telling in terms of looking right after the invasion that actually gas flows through Ukraine

to the E.U. actually increased as Europe tried to obviously get as much gas as it possibly could. And yes, Ukraine would like to keep this business

ticking along.

Extraordinary, really, as you say that we haven't seen disruptions so far, not least if you look at back at years, Richard of Russia and Ukraine

having many gas disputes in the past. And this one's an interesting one, I'm sure we have a map of the pipeline and the transit point in question.

It has crossed Sokhranivka in the Luhansk region, Russian controlled and Ukraine is accusing Russia essentially of interference, siphoning or

diverting off gas. And according to a briefing today, they're putting the value on that as about $30 million a day in terms of the gas they believe

to be diverted. But it's hard to tell, and Gazprom says they deny it.

QUEST: Right. But what I don't understand, why would they be -- it is Russian gas going across, so why would they be diverting their own gas?

STEWART: Well, that is a question certainly for Gazprom. But as they deny any interference whatsoever, I doubt that you get much there.

They are saying that they are still fulfilling all their contracts, the European customers and the European customers have had no complaints. They

are getting the gas, at least they were. They're not going to get that gas now given that transit point has been suspended.

QUEST: Anna, we will keep watching. Thank you.

The whole episode underscores the E.U.'s urgent need to wean itself off Russian gas. We've known that of course, since the beginning. We also know

the price isn't cheap. The E.U. believes it'll need an extra $205 billion over five years to phase out Russian energy.

Even if the money is there, it is not clear whether the political will remains unanimous support or decision to place a ban on Russian oil and you

will be aware of course that they haven't even got the buy in yet from Hungary, even allowing for an exemption.

The E.U. commissioner for the internal market has warned the shortage of energy and other resources could stunt Europe's green and digital

transition.

That commissioner is Thierry Breton, he joins me now from Brussels.

Commissioner, thank you. Before we get to other matters, on this wider issue of getting unanimity on sanctioning Russian oil. Never mind gas. The

whole thing is threatening to break down into disagreement between -- well, it also has broken down into agreement with E.U. members that's making

agreement impossible.

THIERRY BRETON, E.U. COMMISSIONER FOR INTERNAL MARKETS: Well, you know, Richard, we have to be very clear and very frank. We have been able to put

in place extremely quickly before everyone by the way, before the U.S. sanctions.

[15:10:10]

BRETON: Five packages on a roll totally unanimously, which is something quite exceptional, and we have been always very clear, we will continue.

So, it's very true that now we are entering into discussions of the next step. The next step will be oil. We are discussing it.

It is true also that while increasing our sanctions, while also increasing our support to Ukraine, we will have to protect also our interests. So we

are doing both things.

But I think, but I think it will be unfair to say that we are divided, it is the opposite. It's true also, that we have to take care of everyone.

This is our job.

QUEST: Well, I put it to you that, I mean, you are divided. Hungary has made it clear, the exact quote was from the Hungarian Prime Minister, that

it would be like dropping an atomic bomb on the Hungarian economy, and he would not support this.

Now, if you can't get agreement on oil, what happens when you even try to even look at gas?

BRETON: It's true that today for oil, we are very close. But again, we did this, we are a continent, you know, like the U.S., and we have to take care

of everyone. And it is true that we have two countries, which are hundred percent dependent on oil, Russian oil, so we have to take care of them.

In other words, if we make -- if we apply these sanctions, we have also to propose alternative solutions to the one who will need it, which is exactly

what we are doing. This is why it's taking a little bit of time, but we are working on that in solidarity.

QUEST: Right. We will turn to the digital market in one second. One question I do want to ask you, sir, the head of the Volkswagen, VW, Herbert

Diess says he thinks we should stop this war, get back to negotiations. I think we should not give up on open markets. I think we should not give up

on negotiating and trying to settle. Europe will suffer most, but in Germany, I think it will be bad for the whole world.

Do you think that you should get back to negotiations that Ukraine and Russia should get back to negotiations?

BRETON: Listen, there is a war here and the war is a matter of states. It's not a matter of companies. I'd have been always very clear with every

single ecosystem, industrial ecosystem and companies, we will take care of what we have to take care of, but the war is a matter of the state. No one

else.

So it's true that today there is a war between Ukraine and Russia. For us, we are supporting again, what is necessary for Ukraine. But we are not in

the driving seat to finally negotiate between Russia and Ukraine.

QUEST: Let's talk about the digital single -- the Digit Digital Act -- Services Act. Now you and Elon Musk, this is a fascinating story.

You and Elon Musk apparently agree on the way forward? How is this possible bearing in mind, he seems to want, if he succeeds, and I'll put the if in -

- if he succeeds in buying Twitter, he seems to want to allow it to be more open with more, quote, "freedom of speech." Do you square that circle with

your requirements under the Digital Act?

BRETON: Well, listen. We have been working and I've been working on this regulation since day one I'm a Commissioner, in other words, two and a half

years. But before that, I was also working in the tech industry myself, so I know this matters pretty well, of course, by experience, and we didn't

lose one second. We did it.

We aligned 27 countries. We aligned our Parliaments, and now we have a global regulation for what it is today, the biggest digital market of the

world. I'll just remind you that it is one and a half bigger than the U.S. one in digital. And of course, it's very important that we explain now

these rules.

These rules are based on two basic principles. First, to freedom of speech. This is absolutely critical to maintain, to continue to have the freedom of

speech on our networks and our platforms operating in Europe. Second, to protect also our citizens, and in a nutshell, to say that everything which

is authorized in the physical life, our day-to-day life should be authorized on the platforms on the internet.

But everything which is forbidden in digital life is forbidden. And you know what? This is exactly the philosophy that we discussed, Elon Musk and

myself two days ago in Austin and he said that is totally aligned with this principle and with the regulation we put in place including the

transparency of algorithms, which is part of our regulation, including the fact that for us in Europe, it will be impossible to ban someone like

Twitter or ban Donald Trump a year and a half ago, which was something that I criticized myself.

[15:15:23]

BRETON: It should not be in the hands of companies, it is now in the hands of a regulated environment, and I think, we fully -- not I think -- we

fully agreed, of course, with this principle.

QUEST: And that's interesting, because he didn't refer to the fact that he would lift the lifetime ban on Donald Trump.

So accepting that at some point, it will come to, if the deal goes ahead, it will have to be reviewed by European regulators. So, I accept that. But

fundamentally, can you see a problem from your point of view? Can you see a problem with Elon Musk buying Twitter?

BRETON: No. It's not my responsibility to see any shareholding problems for any companies, but it is my responsibility to make sure that any company

operating now in Europe will respect our rules. And by the way, this is an ex-ante regulation. In other words, if you want to benefit from the

internal market, and we welcome everyone, of course, you just have to follow these rules.

It's my job to make sure that these rules are fully understood by other platforms, name it, and then we do it. Let's say they don't do it, of

course, we have to put sanctions, it could be up to six percent of the global revenues, and if they don't fulfill, it will be a ban.

But of course, no one will take the risk, and again, they fully understand why we're doing this. And I believe that maybe some others may get some

ideas to do this also, as well.

QUEST: Commissioner, you've been kind of generous with your time tonight, and we've covered a lot of ground and I'm grateful for you. Thank you, sir.

BRETON: Thank you very much.

QUEST: It is QUEST MEANS BUSINESS from New York.

The U.S. Senate is set to vote on abortion rights. It will codify Roe versus Wade, but we're going to look at the economic effects of abortion

rights and our reasoning goes right to the heart of the U.S. Treasury Secretary, what she said, Janet Yellen, in a moment.

(COMMERCIAL BREAK)

[15:20:09]

QUEST: US senators are being forced to take a stand on abortion rights today. It's a bill that would guarantee the right to access abortion. It's

expected to be voted on by the Senate within the next hour.

It faces strong opposition from Republicans and the Democratic Senator Joe Manchin also says he will vote against the bill.

Manu Raju is on Capitol Hill. The only thing I've heard about this bill repeatedly is that it stands no chance of ever actually becoming law, or

that it is not going any further than it is. So, what's the purpose of this?

MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: It's a show vote, politics, really, Richard. I mean, this is all an effort by the Democratic

leadership to show voters that they are trying to ensure women have a right to access abortion, and that it is Republicans who are blocking it.

Now, there are Republicans -- there are, as you mentioned, one Democratic Senator Joe Manchin, who does plan to vote against it. He is an opponent of

abortion rights. He represents a state, a very conservative state of Donald Trump -- a state that Trump carried twice in 2016 and 2020, West Virginia.

So he is a no.

But there are two Republicans who do support abortion rights, Susan Collins and Lisa Murkowski, but they believe this bill goes further than current

law when the Roe versus Wade Supreme Court precedent and they also plan to vote no.

So the calculation of the Democratic leadership is, we don't want any of the Republican support, we want to show all Republicans voting against it,

because at the end of the day, they would need 60 votes to overcome a filibuster. They are nowhere near that. They're going to have 49 votes on

this.

The most that would get is 52 votes, still short of 60. So they said, at the end of the day, let's put a bill on the floor, make all the Republicans

vote against it, and convince voters that we, the Democrats should get re- elected.

QUEST: On the wider issue now, since -- I mean, we had the comments from Mitch McConnell, the Minority Leader suggesting you know, that the Federal

government could actually legislate the opposite and actually legislate a Federal ban.

But that, of course, would require them to take control, which is not impossible after the midterm. So how far is abortion going to be the issue

in the midterms?

RAJU: It's going to be a huge issue. And in particular, because of the concerns that are going to happen in the state level, and a number of these

number of these -- remember, what will happen if the Supreme Court precedent becomes law is that or this ruling actually becomes a law of the

land, they get rid of Roe versus Wade is they'll kick the issue to the states.

And the states themselves will decide about whether or not to restrict abortion, and get rid of abortion access, how far to go. So in a lot of

these gubernatorial races, governor's races in the United States, it is going to be a central issue in the campaign. But also in some of these

Federal races in the Senate races where the Democrats and the Republicans will argue that them being in charge will determine what kind of Judges and

Justices will be on the Courts of America that could determine whether or not abortion access will be available for Americans. Those will be the key

defining issues.

But as you know, covering the economy, Richard, the economy is really going to be the dominant driving factor, especially as inflation remains so high.

QUEST: Manu, thank you. We'll talk about inflation and the economy next. Thank you, sir. I appreciate it.

But interestingly, interestingly, senators have heard an economic case for abortion rights yesterday and it came from the U.S. Treasury Secretary

Janet Yellen. She said it is a question of giving women a choice to pursue their careers.

(BEGIN VIDEO CLIP)

JANET YELLEN, U.S. TREASURY SECRETARY: Roe v. Wade and access to reproductive healthcare, including abortion helped lead to increased labor

force participation. It enabled many women to finish school that increased their earning potential, it allowed women to plan and balance their

families and careers. And research also shows that it had a favorable impact on the wellbeing and earnings of children.

(END VIDEO CLIP)

QUEST: Extraordinary to hear that from the Treasury Secretary.

Caitlin Myers is an Economics Professor at Middlebury College who specializes in reproductive policies. She is with me from Vermont.

I don't doubt that the U.S. Treasury Secretary was making a strong political point. But on the economic point, does she hold water?

CAITLIN MYERS, ECONOMICS PROFESSOR, MIDDLEBURY COLLEGE: Absolutely. Perhaps it's surprising to some people to hear her make that argument but I don't

think it's surprising to her fellow economists.

She is drawing on a large and rigorous and credible literature in our field that has examined the effects of abortion legalization on women's economic

lives and has found that they are quite substantial.

[15:25:09]

QUEST: So, of course, what is it about termination and abortion that does have this economic element?

MYERS: Well, the decision have been whether and under what circumstances to become a mother is the most economically impactful decision that most women

will make in their lifetimes. It has everything to do with, for instance, gender gaps in labor markets, it has everything to do with women's economic

fortunes.

We know for instance, if you look at the earnings gap in the labor market, men and women don't have really substantial differences in their earnings

before they become parents. It's that crucial moment of parenthood when it opens up. Not much happens to men's earnings, women's earnings fall off a

cliff.

And so that isn't to say that most women don't make the decision to become a mother in their reproductive lifetime and incur those costs. But we know

from past evidence, we know from the Roe experience that the ability to determine the timing of that decision, the timing of motherhood is really

impactful.

QUEST: So again, I appreciate the moral aspect is something different, and that the moral aspect would be well, it is irrelevant in terms of the

economic thing, you know, but let's just stick with the economics.

If Roe is overturned, as it seems likely by the Supreme Court from the leak, where would -- and we end up with a whole host of states outlawing or

making it so difficult to de facto outlaw abortion? Where would you expect to see an economic evidence if you like of this change?

MYERS: This is really likely to be a story about low income women across a wide swath of the South and the Midwest. Women who live in states that

aren't likely to ban abortion don't face the potential for really tremendous impacts on their access, and relatively affluent women in states

that ban abortion will still find a way.

They found a way before Roe and they will find a way after Roe to reach an abortion provider when they find that they want to seek one. It's those low

income women who aren't able to find a way out who are going to face the substantial impacts if Roe is overturned.

QUEST: We will follow this. Thank you. Grateful you came here today. Thank you.

Russia says it is keeping a close eye on NATO as Finland and Sweden think about joining the Alliance. Nic Robertson asked the Finnish students their

thoughts on NATO membership. You'll hear that after the break.

QUEST MEANS BUSINESS.

(COMMERCIAL BREAK)

[15:30:00]

(MUSIC PLAYING)

QUEST: Hello, good evening, I'm Richard Quest. There's a lot more QUEST MEANS BUSINESS tonight.

U.S. intelligence is warning China's military is working hard to take over Taiwan. A chip manufacturing mega hub might be the savior for Taiwan. We

report.

Disaster was averted when a passenger landed the plane after the pilot passed out. You will hear from the air traffic controller that helped.

All of that to still to come after the news, because this is CNN and on this network, the news, comes first.

(MUSIC PLAYING)

QUEST (voice-over): The Al Jazeera network is accusing Israeli forces of killing one of its most prominent journalists. The network says Shireen Abu

Akleh was deliberately shot while covering a raid in the West Bank.

Israeli Defense Forces says it's unclear who fired the shot.

In the Philippines, Ferdinand Marcos Jr. has claimed victory in the presidential election. He is the son of the country's late dictator.

(INAUDIBLE) said the younger Marcos has to be judged by his deeds, not by his family's past.

The E.U. commissioner for internal affairs is pushing back against controversial comments from the chief executive of Volkswagen. Herbert

Diess said the E.U. should push for peace negotiations between Russia and Ukraine for the sake of the bloc's economic recovery. The commissioner said

this in response.

(BEGIN VIDEO CLIP)

THIERRY BRETON, E.U. COMMISSIONER FOR THE INTERNAL MARKET: Listen, there is a war here. And the war is a matter of states. It's not a matter of

companies. But they have always been very clear with every single ecosystem, industrial and company, we take care of what we have to take

care of. But the war is a matter of the state. No one else.

(END VIDEO CLIP)

QUEST (voice-over): The British prime minister Boris Johnson is offering Finland and Sweden security guarantees if they come under attack. The

mutual security deals came during Johnson's visit to the two countries on Wednesday.

Despite Russian threats of severe economic and military consequences, both Finland and Sweden are seriously considering applying for NATO membership.

(MUSIC PLAYING)

QUEST: The Finnish minister for European affairs has told CNN that it's highly likely the country will apply for NATO membership for security

reasons. The situation has Moscow on alert. The Kremlin says they're watching everything that is connected to the alliance's possible expansion.

Our Nic Robertson is in Finland.

He spoke to students there about the future of the country.

(BEGIN VIDEOTAPE)

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: As Finland's parliament discusses at pace the historic step of potentially joining NATO, the speed

of debate has some young Finns worrying their generation will be hurt by a decision taken in haste through fear of Putin that they have little say in.

Five students at the University of Helsinki agreed to tell us their views.

UNIDENTIFIED FEMALE: I'm against NATO.

UNIDENTIFIED FEMALE: I'm still undecided.

UNIDENTIFIED FEMALE: Also undecided.

UNIDENTIFIED MALE: I guess I'm for NATO.

JOHAN, PHD CANDIDATE: I'm ambiguous on the question still.

ROBERTSON: You're against NATO.

NINA, PHD CANDIDATE: Yes.

ROBERTSON: Why?

NINA: It's a military alliance led by a super power that has waged horrendous wars in Afghanistan, in Iraq. I understand people being very

afraid of Russia and what they're doing, horrible, horrible things. But it's kind of like fighting the wolf by teaming up with the bear. Like the

bear isn't great either.

JOHAN: If at this moment if they take a stance toward the whole of Russia, what does it mean in a situation where hopefully the regime changes at some

point to more positive direction?

ROBERTSON: And you're undecided.

OLIVIA, GRADUATE STUDENT: Yes.

ROBERTSON: What -- what's the pros and cons?

OLIVIA: I also get the arguments for safety. And that's why I'm still undecided.

[15:35:00]

VERONICA, GRADUATE STUDENT: I think we are currently a society very emotionally charged and that is why I'm inclined to sort of say that

perhaps now is not the greatest time to make such a huge decision.

OLIVIA: We are a sovereign democratic country and I don't want those kinds of fears to impact our decision making.

OSKARI, GRADUATE STUDENT: I think waiting too long is the more dangerous. It's not as dangerous right now to start this process as it would be in,

let's say two years from now.

ROBERTSON: What's the public debate that's going on?

OLIVIA: In my social media bubble, it's kind of very pro-NATO.

UNIDENTIFIED FEMALE: It kind of does feel like on social media, it seems like if you are anti-Russia, you are automatically pro NATO.

UNIDENTIFIED FEMALE: I feel like a lot of people are making a lot of assumptions about what Putin is thinking. Personally, I have yet to see

evidence of him wanting to invade Finland.

ROBERTSON: What do you think the consequences of this decision are going to be?

JOHAN: If and when we join NATO and if we are admitted to NATO, what kind of relationship will we have with Russia?

And that's the big question to me at least. That, you know, the geography is always there.

ROBERTSON: Many questions here that may not get an answer before Finland's parliament votes on NATO membership. But like Finland's geography,

questions that won't be going away anytime soon -- Nic Robertson, CNN, Helsinki, Finland.

(END VIDEOTAPE)

QUEST: So to the other side of the world, similar issue but different countries involved. Taiwan is seeking its own Western protection; this

time, of course, from a Chinese invasion or potential thereof.

U.S. intelligence is warning China's military is working hard to be able to take over the island nation. Taiwan hopes its leverage as a crucial

computer chip supplier could be lifesaving. CNN's Will Ripley is in Taipei.

(BEGIN VIDEOTAPE)

WILL RIPLEY, CNN CORRESPONDENT (voice-over): Taiwan's first line of defense from a Chinese invasion. Billions spent on missiles, new warships and

submarines, an upgraded fleet of fighter jets. Expanded training for reserve soldiers, all of it dwarfed by the mainland's massive military.

China's defense budget 17 times bigger than Taiwan. Experts say the

island's best defense, its biggest weapon against China, is technology so small you need a microscope. Super tiny, super powerful semiconductors.

This tiny tech powers products you probably use every day.

Taiwan produces about 70 percent of the world's semiconductor chips, most of them made by TSMC, Asia's most valuable company, making chips for

companies around the world like Apple and Intel.

Experts warn any disruption to Taiwan's chip supply could paralyze global production, impacting almost everyone.

J. MICHAEL COLE, SENIOR FELLOW, GLOBAL TAIWAN INSTITUTE: People like to say, Well, Taiwan should be defended by virtue of it being a democracy.

This is oftentimes too abstract. If there is war, an invasion in the Taiwan Strait and immediately, the price of computers would increase. Your cell

phones would become more expensive. It helps people make that self-serving but emotional connection with a society that otherwise would be abstract to

them.

RIPLEY (voice-over): Russia's unprovoked invasion of Ukraine is raising questions about the future of Taiwan, a self-governing democracy, claimed

but never controlled by Beijing's communist rulers.

RIPLEY: Well, what makes Taiwan different from Ukraine, right, is the economic levers?

ROY LEE, CHUNG-HUA INSTITUTION FOR ECONOMIC RESEARCH: Taiwan is much more relevant to the global economy than Ukraine. That is true.

RIPLEY (voice-over): Even China relies on chips from Taiwan. More than 50 percent of the island's exports to the mainland: semiconductors. China is

Taiwan's top trading partner.

RIPLEY: So what does it mean economically for Taiwan and China if there was some sort of conflict to break out?

LEE: It would be disastrous, not only for Taiwan, not only for China but also for the U.S. and the E.U. and everybody.

RIPLEY (voice-over): Chinese President Xi Jinping had vowed to reunify with Taiwan at any cost. Taiwan's chip industry could make the cost of any

invasion far too steep -- Will Ripley, CNN, Taipei.

(END VIDEOTAPE)

QUEST: Busy day?

We're watching things. But we will take a moment to breathe. A leading cinematographer shows us through the ocean of his eyes, a beautiful

underwater journey on "Call to Earth."

(MUSIC PLAYING)

(COMMERCIAL BREAK)

[15:40:00]

(MUSIC PLAYING)

QUEST: "Call to Earth": I don't dive but I do love a bit of snorkeling when I'm at the seaside. Whenever I do, I am in wonder and awe about the entire

life that is under the waves. Today, on "Call to Earth," the photographer and cinematographer and conservationist, Shawn Heinrichs, draws our

attention to those wonders and the risks and problems of the underwater world.

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SHAWN HEINRICHS, CINEMATOGRAPHER, PHOTOGRAPHER AND OCEAN CONSERVATIONIST (voice-over): The ocean is a place where I go to heal. The wind on your

face as you're cruising across glassy seas, the sound of a whale spouting early in the morning, that energy and excitement when you look down at the

water and reef and you see the wings of a giant manta ray flap beneath you, that is always calling to my heart.

My name is Shawn Heinrichs. I'm a cinematographer, photographer but most of all I'm an ocean conservationist. My life is dedicated to telling the

stories of the ocean and inspiring people to protect them.

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HEINRICHS (voice-over): I believe it is close to 2 billion people who live on or near the oceans around the world. But I think it's less than 1

percent of the population on our planet that ever dips their head beneath the surface and gets to experience the magnificent marine life that is all

around us.

It is a huge opportunity and an obligation on our part as storytellers to bring these stories to the people. Through the imagery, the video and all

of the storytelling that we help people feel the connection and, through that, they develop a sense of empathy and a desire to act in protection.

Even in my lifetime, I have witnessed massive declines in the oceans. We have taken more than 90 percent of the large fish out of the oceans in just

a few short decades of industrial fishing.

We look at the oceans as this inexhaustible resource, a place that we can keep taking and taking and taking. Nobody really understands that these are

living, sentient beings, that maintain a habitat that is literally the life support system of our planet.

We are long past the time for pretty pictures and fun stories. We have to take action. The sea like a sea is in a global movement, millions strong,

to activate people around the planet to help restore the health and abundance of our oceans.

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HEINRICHS (voice-over): People want to be part of a solution but they feel helpless. Our job at Sea Legacy is to give them that access point. I could

post a story about a beautiful animal and I could see people light up in India and Brazil and Mexico and in the United States.

They're all really excited about that animal. But when it comes time to alert people to a threat, when I push the red button and I tell a story

about something that is happening that we need to stop, suddenly I have an army of people coming from all corners of the planet, rising up and adding

their voices to protect the species.

The next generation is waking up and they are speaking to their parents and grandparents. Conversations that would never have happened a decade ago are

happening today.

Inspired to be part of it, to use my storytelling and my imagery to bring more and more people into that conversation and inspire them to act before

we lose it all. I think we have a chance but we must act now.

(END VIDEOTAPE)

QUEST: My word, what beautiful pictures and such a powerful message from the underwater world.

What are you doing?

What is your part in all of this?

I'm sure you've been up to something. You want to tell me about it, do so with the hashtag #CallToEarth.

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QUEST: A passenger on a small private plane flying in Florida was forced to fend for himself when the pilot became incapacitated in midair. Listen to

him and the air traffic controller.

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UNIDENTIFIED MALE: I've got a serious situation here. My pilot has gone incoherent. I have no idea how to fly the airplane but maintain at 9100.

ROBERT MORGAN, AIR TRAFFIC CONTROLLER, FEDERAL AVIATION ADMINISTRATION: Caravan 333, Lima Delta, roger, what's your position?

UNIDENTIFIED MALE: I have no idea. I see the coast of Florida in front of me and I have no idea.

MORGAN: What is the situation with the pilot?

UNIDENTIFIED MALE: He is incoherent. He's out.

MORGAN: 3LD, Roger. Try to hold the wings level and see if you can start descending for me. Push forward on the controls and descend at a very slow

rate.

(END VIDEO CLIP)

QUEST: Now thankfully, one air traffic controller was also a flight instructor. You can see the landing here.

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QUEST: Giving impromptu lessons, the single engine Cessna 208 was able to land and, frankly, a little bit of a bump there but it was as smooth as

anything. It came to a stop on the runway. Miles O'Brien is with us, the aerospace analyst.

Miles, you are an accomplished pilot of many years. We all like to think that we could do it if this happened. We would be able to get there and

land the plane. This guy did it.

MILES O'BRIEN, CNN AVIATION ANALYST: Yes, this is -- we've seen this movie, haven't we?

You know, it is the pilot eats the steak, the copilot eats the fish. One goes out. That kind of thing. There is all kinds of plotlines we could pull

on. In reality, this happened in a way that is absolutely extraordinary. But a lot of things lined up in their favor I think.

QUEST: Go on, go through some of them.

O'BRIEN: First of all, good weather, right?

Imagine if this had been the proverbial dark and stormy night, number one. Clear day in Florida. That is helpful. Number two, the coastline of

Florida, very obvious landmark when you're coming in from the Bahamas.

Flown in many times, it's very obvious when you see it. It goes north and south, you get to the beach. You can tell a plane to go up and down and

help identify. That's helpful.

More importantly here, you have got a person, presumably sitting in the right seat, because the pilot would be in the left, who, in a very calm way

reported the problem and listened to the air traffic controller, who happened to be a reasonably experienced certified flight instructor as

well.

Not all flight -- air traffic controllers are that way. All of these things lined up in a way that made this thing happen. I'm still scratching my

head, wondering why I can't do a better landing.

QUEST: I'm looking now to a photograph of the cockpit. Some of the displays were out because the pilot fell on the controls. So he was finding it

difference. But when we look at this, takeoff is relatively straightforward. They always say landing is an art. You're coming to meet

the ground and in a fast way.

The fact that he was able to do it, you wouldn't want to repeat it?

O'BRIEN: No, but when you look at that panel. Of course you go, oh my God. This looks so complicated. But you could eliminate a lot of those

instruments in this case from your need to know situation. This is on a need to know basis.

You've got a controller, they're telling him to go a little bit right, a little bit left, a little bit down slowly, easing you in. The 208 aircraft

is an overgrown version of what the Cessna 172, which is the ubiquitous training aircraft that is out there, it's a very docile player in the

aviation world. It's designed for training.

This is just a bigger version with a turbine engine. In this case, it's a simpler engine to fly than internal combustion engines. We could get into

that if you want.

Another thing that was in his favor, fixed landing gear. He didn't have to worry about that. He's got a wheel, left goes this way, right goes that

way. You want to go down, you push, you pull back. It's relatively straightforward if you don't panic.

QUEST: You say that about the panicking, let's listen to the air traffic controller, who calmly guided the pilot back to Earth.

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MORGAN: About 300 feet he kind of disappeared off the radar scopes.

I said, "hey, can you still hear me?"

I didn't want him to get nervous. He said, "Yes, I'm still here."

I said OK, when you get in closer to the runway, it's going to get bigger. That's when you want to reduce your power. The plane just landed.

He said, OK, how do I stop it?

I said just hit the top of your brakes. It will come to a stop.

He said OK, do want me to taxi off the runway?

I felt like I was going to cry then I had so much adrenaline built up.

He came over after and he cleared everything up because they had to clear customs. And he just gave me a big hug. He said, thank you so much.

I said, man, I'm just glad that you're OK.

(END VIDEO CLIP)

QUEST: The adrenaline and the calmness, that is the key. That's the key, isn't it, Miles?

O'BRIEN: I sure hope the customs guy wasn't hard on him after all of that. Listen, they picked a long runway, that helps. The only thing that is not

completely intuitive about the basics of flying is steering with your feet, the rubber petals, using the top of those rubber pedals as brakes.

This gentleman is clearly a natural. He should go get flying lessons, for sure.

QUEST: Miles, thank you sir. The only -- I've never tried on a real plane; I tried it on a SIM and I always end up almost mowing the grass. I'm

thankful for you.

The last look at the markets on Wall Street.

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QUEST: I want to show you before we go to the break. There we are. I think somebody will confirm yes or no at the moment, but I think we're at the

worst of the day on the Dow. Yes, we are, under 32,000, off at 1 percent.

I'm guessing the triple stack is a horrible look as well. Yes, there we go. The Nasdaq down like a rock, off 3.3 percent. It's the lowest of today

after nearly 400 points. You're getting an idea, this rout continues.

And I fear to say that it is going to continue for some time until the market feels it has reached an equilibrium. Who knows where that will be.

The Dow, you've got Apple, which has problems with China and tech. Microsoft, Boeing is down on economic issues. Disney, lots of questions.

Those that are up, there is no theme to those that are up versus those that are sharply down. "Profitable Moment" comes after the break.

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QUEST: Tonight's "Profitable Moment," I'm not entirely sure what ever the CEO of Volkswagen meant when he said, "I think we should do our utmost to

really stop this war and get back to negotiations. I think we should not give up on open markets and free trade. I think we should not give up on

negotiating and trying to settle."

Then he talked about the economic damage to Germany and Europe. Negotiations in these matters are dealt with by states, not by companies.

Of course, everybody would like there to be negotiations. That is a given. A cease-fire would be the most delightfully wonderful thing.

But neither side in Ukraine or Russia seems they want to have it at the moment.

Each goes about its business of fighting the battle, which leaves the question, why did the CEO say what he did?

Why did Herbert Diess even open up this question of negotiations, a negotiated settlement?

In doing so, he created a whole heap of questions about what Germany and the economy there means, how much are they putting the cost of the war

versus what's happening in Ukraine.

Germany has already made it quite clear, it does not want a ban on gas. It will take a ban on oil. Comments like those don't help the discussion

further.

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 doubt it's profitable,

(inaudible) or making a cake or something. Anyway, the market's closed, we're heavily down. We'll do it all again tomorrow.

END