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Quest Means Business
Eurozone Inflation Slows to 6.1 Percent; Bill Advances to Senate after Passing House; Zelenskyy Pushes for Clear Path to Join NATO; Trump on Tape; JPMorgan CEO Denies Contact with Jeffrey Epstein; Senators Want FAA to Look at Airline Seat Size. Aired 3-4p ET
Aired June 01, 2023 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:23]
ZAIN ASHER, CNN INTERNATIONAL HOST: Stocks are higher as the US moves closer to raising the debt ceiling. The Dow is up more than at 200 points.
Those are the markets, and these are the main events.
EU inflation slows, but policymakers say the fight against rising prices is certainly not yet over.
And fuel prices soar in Nigeria as the government abruptly ends subsidies.
And are airplane seats too small? Two US senators think so, and they want to do something about it.
Coming to you live from New York, it is Thursday, June 1st. I'm Zain Asher, in for my colleague, Richard Quest, and this is QUEST MEANS BUSINESS.
Good evening.
Tonight, inflation in Europe has slowed to its lowest level since Russia's invasion of Ukraine. Prices in the Eurozone rose by 6.1 percent in May,
that is down from seven percent the previous month. That is good news for the European Central Bank, which has raised interest rates nearly 400 basis
points since last year.
The ECB president, Christine Lagarde said Thursday, the bank still has ground to cover. Anna Stewart has more.
(BEGIN VIDEOTAPE)
ANNA STEWART, CNN REPORTER: Prices are still rising in the Eurozone, but month-on-month, they are heading in the right direction. With the fall in
inflation across a broad range of categories, food inflation dropped by one percentage point in May compared to April, although it remains high at 12.5
percent and at this early stage, it is unlikely households and consumers across the block are feeling much benefit from this improvement.
While the glimmer of good news caused some economists to question whether the European Central Bank might ease up on its rate hikes, the general
consensus is there will be a rate rise this month and another to come this year, not least after ECB president, Christine Lagarde spoke about the
bank's determination to bring inflation down to two percent.
In a speech in Hannover, Thursday, adding, we've made clear that we still have ground to cover to bring interest rates to sufficiently restricted
levels.
One of the headwinds for the ECB is wage growth in the Eurozone. Unsurprisingly, given just how costly life has become, thanks to inflation,
workers have demanded higher wages. Wage growth in the Eurozone was 5.1 percent year-on-year in the last quarter of 2022, now, that is not enough
to offset the cost of living, but it does contribute to inflation.
So the ECB will no doubt be watching that indicator as well as CPI before considering a new phase for interest rates.
Anna Stewart, CNN, London.
(END VIDEOTAPE)
ASHER: As Anna mentioned, food prices in Europe still soaring. They rose 12 percent -- 12.5 percent, rather last month, though, that's down from 13.5
percent in April. Services rose by five percent. That's often one of the stickier elements of inflation. Energy prices last month fell by 1.7
percent.
Christian Schulz is the deputy chief European economist at Citi. He joins us live now from Frankfurt.
So just in terms of overall the picture here, 6.1 percent in terms of the headline number for inflation, that's certainly better than what it was.
Good in principle, but inflation certainly remains a problem in Europe.
CHRISTIAN SCHULZ, DEPUTY CHIEF EUROPEAN ECONOMIST, CITI: Indeed, of the large components of inflation, energy, food, consumer goods, and lastly
services, I'd say three are now firmly on a downtrend. So inflation has been down trending for a while. The Russian energy crisis or the Ukraine
crisis, that impact is fading.
Food inflation, you mentioned that was actually the big surprise this time around that it came down a bit more than we had expected. Goods, the supply
chain disruptions of the pandemic, that's over and the Euro has recovered a little bit. So on that side, we're also expecting a downturn.
The big unknown is when is services really going to -- services inflation really going to peak? It came down this month, but that was probably
because of the statistical quirk around German train tickets, but if you account for that, it probably was still rising.
So we're still looking for the peak in services inflation, that's the most important one.
ASHER: So overall, just in terms of the good news coming from the headline number here, what does this change, if anything in terms of the ECB's
calculus as to when to pause rate hikes?
SCHULZ: I think what the inflation data shows is we are in the fine-tuning phase of this rate hike cycle. There is no longer a need for big 50-basis-
point steps. It is now a question of whether it's one two or three rate hikes.
[15:05:10]
By the end of the summer, they're certainly going to be done. And I think it's increasingly the question when the ECB starts becoming forward
looking, again. There is a lot of growth data recently in the Euro area, which has disappointed. So the question is going to increasingly become, to
what degree monetary policy is actually already stepping on the brakes and stopping the economy from growing, and whether we might be headed for a
recession sooner or later.
So I think that discussion will start over the summer.
ASHER: So you anticipate what? Two more rate hikes?
SCHULZ: Well, we definitely expect two more. We've got one penciled in for September, which would take the headline or the policy rate to four
percent.
I think increasingly with the weakening in the growth dynamics, that is becoming risky. It might just be 3.75 percent in July, but the key question
is increasingly going to be when are they going to cut and that we think is going to be some time away. We've got that in the second half of next year.
ASHER: Just in terms of headwinds here. How much of a concern -- obviously, the labor market is still quite tight. How much of a concern the rising
wages continue to be?
SCHULZ: A concern certainly for inflation, most of Europe's inflation was driven by external shocks, both pandemic and supply chain disruptions. But
more importantly, of course, the energy crisis last year, that is starting to fade.
What is level of inflation, what we observe in services is partly just the echo effect of that, but partly also, the fact that wages are responding to
the high inflation. As you mentioned in your opening piece, with a lag, eventually, that should fade, but it's already kind of baked in the cake
that wage growth is going to stay above five percent all year and probably well into next year.
The labor market is very resilient. That means workers feel comfortable demanding higher wages, companies aren't going to immediately fire them as
long as the economy holds up and that is going to keep that process going for a while, and we also have to keep in mind that higher wages, strong
jobs growth means people have more money in their pocket.
And now that inflation is coming down, it actually buys them stuff, too, so real purchasing power is starting to recover and that should keep
consumption going despite ECB rate hikes and that is making it difficult for the ECB to cool the economy.
ASHER: All right, Christian Schulz, live for us there. Thank you so much.
All right, a bill to raise the US debt ceiling and avoid a catastrophic default is now in the hands of the US Senate. It passed in the House on
Wednesday in a bipartisan vote. That was perhaps the biggest test this compromise agreement will face, but we're not there quite yet.
Democratic Majority Leader Chuck Schumer has warned that Senators must act fast.
(BEGIN VIDEO CLIP)
SEN. CHUCK SCHUMER (D-NY): June 5th is less than four days away. At this point, any needless delay or any last-minute holdups would be an
unnecessary and even dangerous risk. And any change to this bill, that forces us to send it back to the House would be entirely unacceptable, it
would almost guarantee default.
So again, the Senate will stay in session until we send a bill avoiding default to the president's desk, and we will keep working until the job is
done.
(END VIDEO CLIP)
ASHER: Melanie Zanona joins us live now from Capitol Hill. So Melanie, the Senate isn't known for moving particularly quickly, but just walk us
through the headwinds here just in terms of possible delays when it comes to perhaps lengthy debates and filibusters and that sort of thing.
MELANIE ZANONA, CNN CAPITOL HILL REPORTER: Yes, so Senate leaders are racing behind the scenes right now to try to fast track this bill, because
as you noted, any single senator can really hold things up and slow things down in the Senate, which means they're going to need everyone's
cooperation.
So in order to do that, leaders are trying to come up with concessions, some sort of deal that can get everyone on board. One of the things that
they are preparing to offer are amendment votes, even though those amendment votes would fail, that is something that can get lawmakers on
board, that they can have an opportunity to go on the record either voting for or against something.
And then a last minute wrinkle that has also popped up today is that there are some Republicans who are really concerned about the spending levels
that are set in this debt limit deal and they are seeking assurances from the Democratic leader, Chuck Schumer, that at some point in the future that
they will be able to pass a separate aid package to boost Defense spending and to boost funding for Ukraine. That is a top priority for some of these
appropriators who are on these spending panels. That's a top priority for Defense hawks and the GOP.
So they're trying to work that out right now. Essentially, what they're trying to do is mitigate some of the impacts of the deal, but we are told
that Senate leaders are getting closer to a deal and that they're going to try to finish up their work tonight, but it could be a long night, given
the fact that there is going to be a number of amendment votes.
[15:10:01]
The bottom line though here is that they are going to get this done it's just a matter of when, not a matter of if, especially after the big
bipartisan vote we saw in the House that is really given a shot of momentum for this bill, and is really driving people to try to get this over the
finish line as fast as possible so that Congress can avoid the first ever default on our nation's debt.
ASHER: Yes. Let's just talk about what happened in the House. I mean, that was huge. How much of a win was that for McCarthy? Just to be able to get
it through the House despite the number of detractors that came out publicly promising that they would vote against it.
ZANONA: Yes. it was a big win for Speaker McCarthy and for President Biden. I think there was a lot of expectation that it was going to be difficult,
and it was no guarantee that it was going to happen. It was a long and rocky road to get there. It took weeks of intense negotiations. There were
breakdowns, there was a last-minute revolt, especially from conservatives agitating against McCarthy.
So the fact that they got it over the finish line with over 300 votes and they only needed 218 was a big deal for them, and I think really defied a
lot of expectations here in Washington, but that doesn't mean that Kevin McCarthy is necessarily out of the woods yet because there are a number of
conservatives who are still fuming over this deal, and they do have the power, any single one of them to try to force a floor vote and outing him
as speaker, so that is something we're going to be watching the days and weeks ahead.
They could go home, and things could cool off or they can come back even more fired up depending on what they hear from their districts back home,
but it is certainly something we are keeping an eye on and something I'm sure Kevin McCarthy is keeping an eye on as well.
ASHER: Absolutely, I'll bet.
Melanie Zanona, live for us there. Thank you so much.
All right, Ukraine pushes for NATO membership after more deadly Russian strikes in the capital, Kyiv. We'll have the details for you after the
break.
(COMMERCIAL BREAK)
ASHER: Ukraine's President Zelenskyy is demanding a clear decision on Ukraine joining NATO. Speaking in Moldova, he also said he is confident a
coalition of countries will provide Ukraine with Western fighter jets.
In Kyiv, overnight, three people were killed during a Russian missile attack when they couldn't get into a locked bomb shelter. Meantime, in
Russia, the governor of Belgorod is claiming Ukraine has carried out drone attacks in the region.
CNN's Sam Kiley is in Kharkiv in eastern Ukraine.
Sam, so much to get through here but just walk us through it just in terms of what's happening in Belgorod. Walk us through what attempts Russia is
making to sort of stave off some of these incursions.
[15:15:04]
SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, I think first of all, the incursions as far as the Russians are concerned, this second
incursion that we know about conducted, or rather claimed by Russian citizens fighting on the side of Ukraine who have crossed into Belgorod
province as you say there. The Russian say they have repelled them in causing these raiders' heavy casualties.
The raiding parties say that they managed to destroy some ammunition dumps and took on some military targets. They have just been posting on their
social media images of them driving around in armored personnel carriers and some skirmishing, but it is impossible to locate those images properly,
because there is no signage or any kind of geographical locators.
But what we do know is that the Russians have said that eight civilians have been injured. We've seen there has been a strike in the town of
Belgorod City itself, eight civilians injured in the -- what are now effectively frontline towns close to the border and 200 families evacuated,
a number of hundred women and children on top of those to a number of safer locations away from these border areas.
And that means that the Ukrainians are having an effect, whatever the scale of these incursions, whatever the scale of the bombardment that is
attributed to the Ukrainians in support of these incursions, they are clearly having an effect by the admission of the Russians, that they are
having to move civilians out of the area, and this now has been going on for more than a week.
ASHER: Just in terms of what is happening in Kyiv. Obviously, we have seen a real sort of escalation from Moscow in terms of bombarding Kyiv.
President Zelenskyy speaking in Moldova at the EU Summit, saying that the West needs to send Patriot missile systems until fighter jets arrive.
Just walk us through more of what he said in terms of the type of military aid Ukraine needs right now.
KILEY: Well, he said Patriots are Patriots, in other words, in his view, until they get the F-16, which they are hoping to get into Ukraine, perhaps
by the end of the year, having got support for this from The Netherlands, United Kingdom, and even now, the United States with training programs
being promised, but until they get them, their best weapon for bringing down particularly the hypersonic Kinzhal missiles, but also the surface-to-
surface missiles, that the Russians use that which come in at a speed of six or seven times the speed of sound, you need a Patriot, and one or two
other systems that the Ukrainians also have to bring them down.
So for example, the missiles that were fired this morning at three o'clock in the morning that killed three people, two women, and a nine-year-old
girl, a mother and daughter were killed in that raid. They were killed by the descending debris from Iskandar domiciles that were shot down, possibly
using Patriots, possibly using other anti-missile missile systems, but they are under extreme strain, particularly in the Kyiv area where the Russians
have been concentrating their missile and drone attacks over the last month or so -- Zain.
ASHER: All right, Sam Kiley, live for us there, thank you so much.
And in the past hour, CNN's Isa Soares spoke to the head of NATO, Jens Stoltenberg and said the alliance will only accept Ukraine as a member
after the war is over.
(BEGIN VIDEO CLIP)
JENS STOLTENBERG, SECRETARY-GENERAL, NATO: We all agree that in the middle of the war, we cannot make Ukraine a full member of NATO, but at the same
time, we need to prepare for what happens when the war ends, because then we need to ensure that history doesn't repeat itself, that President Putin
just reconstitute and rest, the Russian forces regroup and then attack again, because he has attacked Ukraine many times. It started not last
year, it started in 2014, first with Crimea, then with Eastern Donbas, and then with the full-fledged invasion last year.
And this vicious circle -- cycle has to be stopped, and therefore, we need to discuss and address what kind of security arrangements can we have in
place to ensure that President Putin is not able to continue to chip away at the European and Ukrainian security and then the issue of also security
arrangements, membership in NATO will be part of that discussion.
ISA SOARES, CNN HOST: Understood, but without a session at this time, how can you guarantee NATO's ongoing support, as well as unity when the
political climate here could change at any moment. I am thinking here of US elections.
STOLTENBERG: So what we have seen is a very strong support throughout alliance in Europe, but of course also in North America for an
unprecedented level of military support for Ukraine.
[15:20:07]
And President Putin made a big strategic mistake when he invaded Ukraine by totally underestimating the courage and bravery of the Ukrainians, but he
also totally underestimated NATO and NATO allies, our resolve to support Ukraine, and I welcome the strong bipartisan support in the United States
for supporting Ukraine and I'm absolutely confident that we will be there to stand by Ukraine for as long as it takes.
(END VIDEO CLIP)
ASHER: Some major US retailers are warning that shoppers are cutting back. Shares in Dollar General are down nearly 20 percent. The discount chain
lowered its sales and profit forecasts and said customers are spending less on discretionary items amid higher inflation.
Macy's is also suffering from slowing demand. It said same store sales are down nearly nine percent.
Nathaniel Meyersohn is joining us live now from here in New York. So Nathaniel, Macy's reported weak earnings today and slashed its forecast for
the year. What does that say?
Just walk us through what that says about the state of US consumers right now.
NATHANIEL MEYERSOHN, CNN BUSINESS REPORTER: So consumers are clearly pulling back right now. As you say Macy's same store sales down 8.7 percent
from a year ago. The company said that people were buying fewer clothes, and they were shifting their spending more towards food, essentials, and
also travel.
We see some really strong numbers from airlines, cruises, hotels. People are traveling, they are taking trips, what they weren't able to do early in
the pandemic, but they're not buying as much clothing or furniture.
ASHER: And Macy's, of course, isn't the only company offering warning signs about the health of American consumers. Just walk us through what other
companies are saying right now.
MEYERSOHN: So Costco said that its customers were buying less expensive steak and beef and instead switching to cheaper pork, canned tuna, chicken
that's potentially a recession indicator.
We see customers pulling back at Home Depot, Lowe's. We're not seeing as many of these big home renovation projects that we saw early in the
pandemic when there was a home renovation boom, and then Dollar General. Dollar General today plunged almost 20 percent.
The company said that its lower-income customers, that's really the core of these Dollar General shoppers were squeezed right now and they were pulling
back, weren't able to afford some of these discretionary purchases; instead, really just focusing on food and the essentials.
ASHER: All right, Nathaniel Meyersohn, live for us there. Thank you so much.
Gas prices in Nigeria have nearly tripled this week as people rushed to fill their tanks. The panic buying started after President Bola Tinubu said
he would end the gas subsidy. It is a big move for Nigeria where cheap gasoline is part of daily life.
When the government tried to end the subsidies back in 2012, nationwide protests broke out, but President Tinubu said on Monday the policy no
longer makes economic sense.
(BEGIN VIDEO CLIP)
BOLA AHMED TINUBU, NIGERIAN PRESIDENT: The fuel subsidy is gone. The subsidy can no longer justify its ever-increasing costs in the wake of dire
resources.
(END VIDEO CLIP)
ASHER: Stephanie Busari is joining us live now from Lagos. So Stephanie, clearly the fuel subsidy was unsustainable long term. It is a huge
financial burden for the Nigerian government, especially when you consider the fact that 96 percent of the government's revenue goes towards servicing
debt. Clearly, they need to free up more money. This is one way they are trying to do that. But that doesn't mean this is not going to come without
hardship.
Just walk us through what ordinary people are saying about this move.
STEPHANIE BUSARI, CNN SENIOR EDITOR, AFRICA: Zain, with those four words, the president during his inaugural speech sent what can be described as
just pure panic through the country, and suddenly, long lines formed and people were queuing to buy, to fill up the cars just to stock up because
they knew prices were going to rise.
And then some gas stations just stopped selling altogether, and then consequently, transport cost hiked up as well. In some cases, as 200
percent in some places.
We had a funny story of people traveling to the capital for the inauguration and having to pay double to come back to their places, to
their cities soon after that announcement.
[1:25:01]
So it is clear that the markets and the oil markets are reacting to what the government even says has not started. This is supposed to come into --
the policy come into effect at the end of June, but already we're seeing price increases across petrol stations across the country, and the prices
are not even the same.
So you can't really say what the actual current price is because they vary along cities.
We've been talking to people in Lagos just to gauge the mood and as you can probably imagine, there is a lot of anger. Take a listen to what some of
them had to say.
(BEGIN VIDEO CLIP)
CHIMMA KALU, NIGERIAN BANKER: If we were given time before they fully remove the subsidy, it would have helped us in a way, because I believe the
government is heading towards the right direction. The only difference is the manner with which they told us the subsidy was removed.
CHRISTOPHER DAWET, NIGERIAN BANKER: Subsidy removal, it is a good thing, anyway, as a mean of -- our leaders have been proactive in everything. What
I mean by proactive, certain things in place, you understand that will ease the suffering.
VICTORIA AKPAN, NIGERIAN SINGLE PARENT: It is affecting me personally, because I'm a single parent. I am a widow. I have three kids and they are
all in the university. So I'm just wondering, how am I going to cope with three kids? All in the university. I pay rent. I take care of the upkeep. I
pay their school fees, I need to fuel my car, I need to buy fuel for my generator.
There is no light. So, I don't really understand what the government is up to. They don't think about the poor masses at home.
(END VIDEO CLIP)
BUSARI: So Zain, you know the people are thinking that the government has lacked empathy, really in the way that this has been announced, because as
you as you know, you're Nigerian and you've been to the country, people have to buy everything themselves pretty much. And people have to provide
their own power with generators.
And so the cost of that is just going to ramp up on family as incomes and spending levels significantly. Now, people agree that the subsidy has to
go. Nigeria is spending close to $900 billion every -- $900 million every month on subsidizing petrol, but Nigerians feel that it's a perk, if you
like of being in an oil producing country, in which they don't get very many perks at all -- Zain.
ASHER: You think about, I mean, you know, the lady that you interviewed there, the last woman just sort of laid out all the different expenses. And
you think about when the price of fuel triples like everything becomes way more expensive.'
So this is a huge hardship for Nigerians.
When President Goodluck Jonathan tried the same move more than a decade ago, it was met with so many protests, in fact, Tinubu was on the other
side, he was actually supporting the protesters in that. Will there be the same kind of outrage? Will there be protests, do you think? Long lasting
protests, rather as a result of this move?
BUSARI: So Zain, I covered those protests in 2012, actually, and I remember how angry people were. And part of the reason then people felt, and I felt
certainly was that it hadn't been communicated effectively, what the subsidy meant and why it was being taken away. I think successive
governments, including the previous administration has managed to convey to Nigerians that, actually, we can't afford to have the subsidy anymore, and
Nigerians have a more clear understanding that it is not sustainable to have this subsidy.
So I'm not expecting to see those kinds of levels of protests that we saw, two weeks, the country was brought to a standstill in 2012. But they just
feel that it could have been handled better. There should have been a lot more empathy, a lot more discussions with the labor. The Congress of
Nigeria has called it an insensitive decision, and they will certainly be mobilizing their supporters.
But I don't expect to see those wide-scale protests that we saw in 2012 -- Zain.
ASHER: Well, it's an adjustment, either way you look at it. The lady you spoke to there saying, you know, the government doesn't think about the
poor man at all. I imagine that a lot of people on the ground there feel that way.
Stephanie Busari, live for us. Thank you so much.
And earlier I spoke with Rolake Akinkugbe-Filani. She's an energy and infrastructure specialist in Lagos. She told me Nigeria's government simply
cannot afford these subsidies. She also said the World Bank has been trying to protect Nigerians from this kind of economic hardship.
(BEGIN VIDEO CLIP)
ROLAKE AKINKUGBE-FILANI, ENERGY AND INFRASTRUCTURE SPECIALIST: The World Bank did provide an $800 million loan for palliatives to ease the
socioeconomic effect on the population, but that loan was signed by an administration that is no longer on seat and it remains to be seen what
provision this current administration would make to ease the pains.
[15:30:00]
It is a reality. There are long fuel queues. The hardship is clearly felt across the board. But Nigeria has also been in a fiscal black hole that
really, there was no other way to go (INAUDIBLE). There is a question around the timing of this announcement, given that they still had about a
month to go.
And the government is in dialogue with the unions. The current president had said that the hallmark of his administration would be consensus and
dialogue. It remains to be seen what the outcome of that will be and whether the government will draw down on a World Bank loan, which it didn't
actually negotiate to cushion the effect.
But I understand it's meant to be cash transfers to about 50 million Nigerians across 10 million households on that loan. But we just have no
idea how the government will manage that process.
(END VIDEO CLIP)
ASHER: Migrant workers across the U.S. are protesting a new immigration law in the state of Florida. We will have a live report from Florida on what is
being done on A Day without Immigrants. That's next.
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(COMMERCIAL BREAK)
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ASHER (voice-over): Hello, I am Zain Asher. There is more QUEST MEANS BUSINESS in a moment, when changing consumer habits in the U.S. are raising
alarm bells from some of the country's biggest retailers.
And it's not your imagination, airline seats really have been getting smaller. Now U.S. lawmakers are asking, are smaller seats actually safe?
Before that though, these are the headlines at this hour.
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ASHER (voice-over): A CNN exclusive: U.S. Federal prosecutors have obtained an audio recording that could spell more legal trouble for former president
Donald Trump. Multiple sources tell us that Trump acknowledges on the 2021 recording that he kept a classified Pentagon document.
[15:35:00]
ASHER (voice-over): He has publicly maintained that he declassified everything after leaving the White House.
One of China's top tech bankers is in the custody of the country's main anti-graft watchdog according to a state media report. Leo Fan (ph) is the
founder and CEO of China Resistance (ph), a boutique investment bank. His disappearance in February sent a chill through China's tech sector and
financial markets.
French president Emmanuel Macron said that the leaders of Kosovo and Serbia have accepted a plan to resolve regional tensions. It calls for new
elections in four regions of Kosovo where last month's elections were boycotted by the Serb majority, leaving ethnic Albanians to win. That
sparked violent protests this week.
Senegal state media says the opposition leader Ousmane Sonko has been sentenced to two years in prison for corrupting youth. The conviction makes
it ineligible for next year's presidential election. The court reportedly cleared him of a rape change. He said the rape allegation was politically
motivated.
And football star Lionel Messi will play his last football game for Paris Saint-Germain against Claremont on Saturday. His coach confirming the news
today. His current contract runs out in June. Speculation about his future has been rife with rumors of a lucrative deal in the Middle East.
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ASHER: Migrant workers across the U.S. are protesting a new immigration law in the state of Florida. A Day without Immigrants events have been planned
in Florida and in six other states as well. They include California, Colorado, Illinois, Minnesota, South Carolina and Texas.
The protesters are angry about a law adopted last month by Florida governor Ron DeSantis. It cracks down on employers who hire undocumented workers and
makes it harder for the workers to receive social benefits, among other things. The measures take effect July 1st.
Carlos Suarez is in Florida for us with the very latest.
This Day without Immigrants, this protest, is proving how valuable migrant workers are to the Floridian economy. Walk us through what concrete effect
this day of protests will have.
What sort of meaningful change will come about here?
CARLOS SUAREZ, CNN CORRESPONDENT: Well, in terms of meaningful change, this bill was passed by the Florida legislature. The governor has already signed
it. It is law, it's going to take effect in July, as you noted.
That aside, immigrants across the U.S. and across Florida are just trying to highlight the economic impact that they have in their communities from
where folks go shopping, to where they eat, to where they spend their time.
We are in Immokalee, Florida, a farming migrant community to the east of Fort Myers, Florida. That is in the southwestern part of the states, where
several businesses really are closed for the day.
We are talking about restaurants, supermarkets, even the Catholic Church said they were not going to open today, all in support of these immigrant
protests that are taking place across Florida and the U.S.
There is a great deal of concern about what is going to happen once this new law takes effect in July. We caught up with one of the organizers of
the event that is taking place here later. She told us that they are already seeing the effects of this law.
Migrant workers, undocumented workers are leaving their jobs. She described how, because harvest season in parts of Florida is already over, workers
are going north and they have already said they are not coming back. Here is a bit of our conversation.
(BEGIN VIDEO CLIP)
MARIA PLATA, PROTEST ORGANIZER: We have many farm workers who have already left and they've already migrated up north. But they are thinking about
where they are going to go in October. Right, because they will not be coming back to Florida.
So they are having to say goodbye to friends, family members, as well as the community that has helped support them.
(END VIDEO CLIP)
SUAREZ: And on the business side of things, we have also talked to a number of business owners. A restaurant owner told us that he lost (INAUDIBLE) a
third of his workers left their jobs because they're undocumented workers. They are worried about what's going to happen next.
They all told him they were going to leave Florida. Of course, supporters of this measure, say that it is needed in order to make Florida less
attractive when it comes to bringing undocumented workers into the state.
ASHER: Carlos Suarez, thank you so much.
Investigations continue into the relationship between JPMorgan Chase and Jeffrey Epstein. The bank's CEO Jamie Dimon was recently questioned. Matt
Egan has that next.
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[15:40:00]
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ASHER: The longtime CEO of JPMorgan Chase says that he had little firsthand knowledge of the bank's relationship with Jeffrey Epstein. The bank is
facing lawsuits brought by a victim of Epstein and by the attorney general of the U.S. Virgin Islands.
Jamie Dimon sat for an eight-hour long deposition last Friday. CNN obtained a redacted transcript in terms of what he said. Matt Egan is in New York
for us.
Jamie Dimon basically saying that, before Jeffrey Epstein's arrest, before his name was all over the newspapers, he had never even heard of him. Walk
us through what came out of the deposition.
MATT EGAN, CNN BUSINESS SENIOR WRITER: During that eight-hour deposition, Jamie Dimon, he denied ever having met with or spoken on the phone with
Jeffrey Epstein. Let me run you through the timeline.
Epstein was a client from 1998 to 2013. During that time, Epstein was indicted on a prostitution charge in 2006 involving a minor. He pled
guilty.
Then, in 2019 he was arrested on federal sex trafficking charges. He died by suicide while detained. Jamie Dimon says he was not really aware of
Epstein's criminal history and relationship with the bank until after the 2019 news broke.
These lawsuits allege that people at Chase knew about the sex trafficking allegations against Epstein but still did business with him.
In a statement to CNN, the spokesperson said that, "Had the firm believed he was engaged in an ongoing sex trafficking of operation, Epstein would
not have been retained as a client. In hindsight, we regret he was a client."
Dimon did acknowledge that he is now aware that some JPMorgan employees knew Epstein was charged with sex crimes involving cash and that he was
moving large amounts of cash in his accounts in 2007.
We should note, JPMorgan has sued a former banker, known to be a friend of Epstein, alleging that he is to blame for the bank's 15-year relationship
with Epstein. Still, he has denied all wrongdoing.
ASHER: Thank you so much.
Do you ever feel like you are being packed like sardines onto an airplane?
Well, two Democrats are on your side. They want the FAA to look at seat sizes, saying it is becoming a safety issue. That's next.
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[15:45:00]
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ASHER: If you fly regularly, this will certainly come as no surprise. Airline seats are getting smaller. That's right. In the '60s it was a
breeze. Passengers had around 89 centimeters -- 35 inches -- of leg room.
Now get this, it's under 79 centimeters. That's actually average. Some airlines actually have seats smaller than that in terms of leg room.
Advocacy groups, flyers rights, say that some seats are as short as 71 centimeters. Since the '60s, we have actually gotten bigger.
Two Democratic senators want the U.S. airline regulator, the FAA, to take a look at seat sizes again. They say it's becoming a safety issue.
(BEGIN VIDEO CLIP)
SEN. TAMMY DUCKWORTH (D-IL): It is very much long overdue. The standard that the FAA is using was set in the 1960s. And the fact is that air travel
has changed a lot since the '60s.
There are a lot of folks on board, would carry on luggage, because we can't -- many people can't check their luggage anymore because there's additional
fees. The FAA does not test -- do these tests where they include carry-on luggage.
(END VIDEO CLIP)
ASHER: Brian Kelly is the CEO of The Points Guy and he joins us live now from New Hope, Pennsylvania.
This is something I have thought about for quite awhile just in terms of narrowly squeezing into these seats, especially if I'm flying on a domestic
airline here in the U.S. The FAA has been flooded with complaints by passengers about just how small these seats are, especially if the person
in front of you reclines.
Then you have no hope of having a comfortable flight. Walk us through what changes now.
Is the FAA going to make changes as a result of some of these complaints that they are getting from customers?
BRIAN KELLY, CEO, THE POINTS GUY: I could not agree with you more, as a 6'7" traveler, there are certain planes I simply --
(CROSSTALK)
ASHER: You have no chance.
(LAUGHTER)
KELLY: So I understand people's pain. And the FAA's mandate is safety. By law, when the airlines were deregulated in the '70s, the FAA can now only
make rules to make airlines safer.
And it is very silly that, in 2019, they conducted egress tests, because every plane should be able to be evacuated within 90 seconds.
[15:50:00]
KELLY: They did these tests with environments that are nothing like the real world. I could not agree more with the legislators who came out today
and said, hey, at the minimum, let's do the tests that reflect the actual environment.
Whenever they test cars or rocket ships, they put them through wild environments. So it seems like the FAA kind of phoned it in and did some
lame tests just to say that the current status quo is fine.
ASHER: During the test, the planes were not nearly as full. They used passengers from the ages of 18 to 60 but no senior citizens, no one with
disabilities. So clearly not reflective of a real world environment.
But explain to us how not having as much leg room and smaller seats overall can affect safety in terms of rapid evacuation.
KELLY: Yes, so there are exit rows -- in order for people to get out, you need space. Right now, if you try to use the restroom, on many planes,
everybody in that row has to get out because there is just no physical way.
So the FAA wants planes to be evacuated in 90 seconds and it's life or death. The smaller the row, the harder it is to get out, the more clogging
in the aisle.
I will also state that there are other things beyond evacuation that makes crowded planes more unsafe. I think it does increase the amount of
passenger interaction. The flight attendant union said that these crammed in seats are creating ever more tense environment on board.
(CROSSTALK)
ASHER: Fights?
(CROSSTALK)
KELLY: Exactly. That's a safety issue. Yes, and that is a safety issue. So --
ASHER: Yes. So the FAA, their focus is, of course, on safety, on evacuations at this point in time.
Should their focus also be on comfort?
Isn't it fair that, if you're paying for a certain amount for your seat, you deserve a certain amount of comfort, especially in this inflationary
environment, where tickets are getting all the more expensive?
KELLY: Yes, you know, I don't believe so. I do believe in the free market environment. I believe that consumers should have the education and, when
you buy a ticket, it should clearly state; some airlines don't have recline.
But I would hate to see rules where that would (INAUDIBLE) up fares even higher than where they are today, which would price out a certain market.
There are certain people who are happy to have a crammed in seat and pay a fraction and not -- you know, so --
(CROSSTALK)
KELLY: -- I don't believe the government should make planes super luxurious and comfortable, which inevitably would raise fares.
ASHER: Fine. That is a good point --
(CROSSTALK)
ASHER: -- it would lead to higher prices for everybody if you ended up getting a little bit more leg room.
So if airlines are forced to reconfigure or they are forced to expand leg room just for evacuation purposes and safety purposes, what kind of an
undertaking would that actually for an airline?
KELLY: It certainly would be a multiyear undertaking. I think they probably make the rules for planes going forward that are delivered. But yes, it is
extremely expensive. But airlines do this all the time. Airlines are sneaky. They will take out a row of seats to get around the rules, because
there are a certain number of flight attendants that you need to have.
So we have seen them block off seats on planes so that they do not have to add an extra flight attendant. So they are clever when it comes to
maximizing their profit. If it's a safety issue, I'm sure they will find ways to put some space back in the rows.
ASHER: But in the meantime, I think we all have to just endure the cramped environments we find ourselves in when we are traveling. It is tight in
there. All right, Brian Kelly, live for us there, thank you so much.
OK. A Malaysian climber on Mt. Everest is alive thanks to an Nepali Sherpa guide. The Sherpa was helping a Chinese client to the summit when he saw
the other climber clinging to a rope in a notoriously dangerous area. Isa Soares reports.
(BEGIN VIDEOTAPE)
ISA SOARES, CNN ANCHOR AND CORRESPONDENT (voice-over): At the ominously named Death Zone of Mt. Everest, during one of the deadliest climbing
seasons on record, Nepali guide Gelje Sherpa carried out a rare and almost impossible rescue mission.
It was midnight when he saw a Malaysian climber clinging to a rope, shivering in freezing temperatures. Just over 1,100 feet away from the
29,000 feet high summit. The air too thin for humans to breathe and for helicopters to land.
GELJE SHERPA, EVEREST GUIDE (through translator): It was impossibly important for us to rescue him even from the summit. Money can be earned
anytime. Left like that, he could have died. We have saved his life by quitting the summit.
ASHER (voice-over): Gelje convinced his client to abandon the summit climb attempt, so they could save the Malaysian climber's life. Gelje wrapped the
stressed climber in a sleeping mat and hauled him down with another guide's help.
[15:55:00]
SHERPA (through translator): We had brought him down from camp four, carrying him on our backs because dragging was impossible.
It took me 5-6 hours to get from 8,500 meters to 7,900. It was very difficult.
SOARES (voice-over): From there, a helicopter lifted the climber down to base camp.
The favorable spring weather is gradually turning even more unpredictable because of climate change.
Eleven people died on Everest in 2019, a climbing season that saw unprecedented traffic and long delays in the same death zone near the
summit. This season, Nepal issued a record 478 permits. So far, 12 people, including an American, have died, the highest number for eight years, and
another five are missing.
The unidentified climber was put on a flight back to Malaysia last week, thanks to Gelje his name was kept off the list of the mountain's victims --
Isa Soares, CNN.
(END VIDEOTAPE)
ASHER: There are just moments left to trade on Wall Street. We'll have the final numbers and the closing bell right after this short break. Don't go
away.
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ASHER: The president of the Philadelphia Fed says he's in favor of pausing interest rate hikes this month. The central bank makes its decision in two
weeks.
Let's take a look and see how the Dow is doing. The Dow has actually given up some of its gains in the past hour but still in the green. Investors are
still optimistic that the U.S. debt ceiling deal will pass in the Senate. We are watching closely for that.
Let's take a look at the Dow components. A couple of credit card stocks are on top. AmEx says that it's confident about the year ahead. Home Depot and
Walmart are in the green, despite Macy's sales warnings.
Salesforce is at the bottom, its revenue growth last quarter was the slowest since 2010.
We will leave you with this, live pictures from CNN Center in Atlanta. CNN staff celebrating the networks 43rd anniversary, June 1st, 1980. Ted Turner
launched the world's first cable news 24-hour network. Our colleagues are celebrating. I am Zain Asher.
END
