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Quest Means Business

Moody's Warns On Six Banks; World Hits Critical Warming Point In July; Study: Wegovy Reduces Risk Of Heart Attack, Stroke; Italian Cabinet Approves 40 Percent Windfall Tax On Banks; Fans Gather To Mourn Sinead O'Connor In Ireland; Dash To The Bell. Aired 3-4p ET

Aired August 08, 2023 - 15:00   ET

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

[15:00:26]

RICHARD QUEST, CNN INTERNATIONAL HOST: And we're off with an hour to go of trading on Wall Street. The Dow is down. It has been much lower, so we've

got a bit of a recovery going on, but I still think it's going to take quite a bit to turn that around. It seems to sort of settle around about

half a percentage point down.

All sorts of reasons why the Dow is lower. I'm going to be talking about them. For instance, new concerns about the health of US banks. Moody's put

six banks under review for possible credit downgrade.

Staying with banks, the Italian government hits its banks with a surprise windfall tax, and that sent banking shares in Italy was much lower.

And how high for how long? The impact on your portfolio. With me tonight, the chief investment officer at Vanguard gives some direction and guidance

thoughts.

We are live in New York. It is Tuesday. It is August the 8th. I am Richard Quest, and yes, I mean business.

Good evening.

There are new signs of financial distress in the US economy. Moody's has downgraded 10 small and midsize banks, and its notice warning, higher

funding pressures and commercial real estate risks is the reason, or one of them, there's several of them. We are showing you the share price of some

of the lenders and they are all -- no, not dramatically -- because perhaps the market have priced in risk, but they are all down.

And the rating agencies warned it is reviewing the credit of these six larger banks particularly BNY Mellon and Bancorp, which the largest, and

State Street. The markets are down amid the news.

In addition, Bank of America says more Americans are tapping into their retirement accounts, so 401 (k)s because of hardship, and the New York Fed

says credit card debt has now surpassed a trillion dollars, a new record.

Matt Egan is with me.

Matt, I sort of feel that we have -- particularly with those last two bits of news, the Bank of America and the Fed. We've put our head under the

water of the economy and we're seeing the undercurrents and they are not good.

MATT EGAN, CNN REPORTER: That's right, Richard.

I think, it is just another reminder of the real risks here in the economy, right? We're dealing with a high inflation situation, and a Federal Reserve

that is more aggressive in trying to get inflation back down, more aggressive than we've seen in at least 40 years. So of course, there's

going to be consequences.

Some people are being squeezed, consumers, and they're being forced to tap their 401(k) accounts and others are being forced to rely on credit cards,

with credit card debt topping a trillion dollars. This Moody's warning though, I think that's the one that really set off the selloff in the stock

market.

Moody's is concerned here. they say that they could downgrade six larger US banks, BNY Mellon, State Street, US Bancorp, Northern Trust, Truist and

Cullen/Frost. All of those stocks are down in the day. The whole regional banking sector is down, and Moody's is setting three particular concerns.

One is lower profits, two is higher funding costs, and then also looming commercial real estate losses. And Richard, I would note that all three of

those are all tied to the Fed's war on inflation, this spike in interest rates.

QUEST: The banks' essentially lower profit is because of lower activity, having to pay higher -- also, more to savers and less M&A activity and sort

of investment banking activity, but going to those too, the credit card at a trillion dollars.

You see the problem there is as I see it, firstly, people will have to spend more disposable income paying interest rates, or secondly, they had

to stop spending. Both of those in whichever way or they'll do both, both of those will further slow the economy.

EGAN: Yes, absolutely, because consumer spending is the main engine of the US economy, and so that's why it matters so much.

But to your point, there's never a good time to rely on credit cards, right? There's never a good time to carry a credit card balance, but

arguably, Richard, this is the worst time because credit card rates have never been this high.

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Some credit cards are over 21 percent in annual interest, and so it is a very expensive way to borrow, and you're right, that some people are going

to have to devote their income to interest, while others are just going to have to slow their spending altogether, neither is a good thing.

QUEST: Matt Egan, thank you.

Between credit downgrades and rising interest rates, it's getting hard to figure out the best or the optimal, if you will, there's no best or worst,

where to invest your savings.

Now, this is what I'm showing you. So I want to -- this is a sort of a classic mixture of investments. The green balls represent the equities, the

blue represents fixed income bonds. The traditional mix, of course, has been 60/40. Some have suggested that doesn't work anymore.

Generally speaking, one goes up, the other goes down. Mass generalization, but in recent years, both went down, and that was somewhat different.

And of course, we haven't even accounted for what we might describe as alternative investments or other things you should be looking at.

Vanguard says it expects returns will improve. Greg Davis is the chief investment officer at Vanguard, managing around a trillion dollars in

assets. He joins me now.

Sir, do you still subscribe to 60/40?

GREG DAVIS, CHIEF INVESTMENT OFFICER, VANGUARD: Absolutely. I mean, it plays a vital role in terms of diversification benefits of having exposure

to equities, as well as bonds. Recognizing that the year of 2022, we saw a downturn in both the equity market and the bond market, but if you look

over a longer period of time, on a risk-adjusted basis, a 60/40 portfolio for most investors who are saving for retirement, or their kids' college

education still makes a tremendous amount of sense.

QUEST: You see that's a huge difference, isn't it? You're talking sensible investment over the long term. Most people are looking for a quick buck, or

a quick speculative. I mean, the whole meme stock stuff.

How do you get investors to turn away from that -- I need to make 10 15 percent and back to, as you're forecasting four to six percent?

DAVIS: Well, the reality is, you know, when you start talking about meme stocks, you're talking about speculation. Speculation is not investing. And

so you know, unfortunately, people have to learn a very painful lesson that, you know, we've seen this before when you think about the dot-com era

of the early 2000s, and so you see significant repricing, so people think they can make money relatively quickly, by jumping on the bandwagon and

being invested in momentum stocks.

But that's not investing, again, that's speculating and that's not how you save for retirement or your kids' college education.

QUEST: Your experts at Vanguard describe the latest prices in the market as frothy, the word that they use. Now I think about froth as it comes off the

top and it can be wiped off the top, but you're still overall bullish on the question of equities.

DAVIS: Yes, Richard, that's a great question. The reality is, again, when we're talking about folks who are investing for the long term, 10-plus

years, 20 years, having exposure to equities, even in an environment where in the short run, they do look expensive, it still makes sense when people

are investing for a 20-year time horizon, because we know, equities in the long run tend to outperform all other asset classes.

So we still think, there is a very vital asset allocation component for people's portfolios.

QUEST: The bonds, I mean, classic bonds. All right, your principal is lower, even though you're now getting a relative higher interest rate

because of rates, but where does fixed income fit into it?

DAVIS: Well, you know, the great thing about fixed income today, relative to where we have been for the last 10 years or so is that you're actually

earning a reasonable level of income.

You look at money markets today that are producing a yield of about five- and-a-quarter percent, which is way better than when they were flattened down to zero percent because of Fed policy. So investors are being

compensated for saving and investing in money markets, and the same thing is happening on the bond side as well, where you're actually earning a

yield that's greater than the level of inflation, which is not something that we've seen over the last 10 years.

So investors can start to feel much more comfortable having exposure to cash, having exposure to bond funds, because the yields are much greater

than what we've seen and our expectations for the next 10 years are that folks who are investing in highly diversified bond portfolios are going to

produce returns in the four to four-and-a-half percent type range.

QUEST: Cash, good old-fashioned cash, got the piggy bank here to help it along. Cash is always King, they say, I don't know.

DAVIS: You know, it's interesting. I mean, again, when you're looking at money markets at five-and-a-quarter percent, you know, relative to

investors who might be keeping deposits at a bank account where they're earning less than half a percent, that's money that they're leaving on the

table that could be more wisely invested in an asset that produces really good returns and ultimately is safe.

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QUEST: I've got to ask you, Greg, about this net zero business. Vanguard pulled out of this alliance, basically claiming a fiduciary relationship

requires you to be more independent, but where do you balance the requirements -- where do you balance the requirements of ESG/climate change

versus an investment? I mean, because you could obviously make more money if you just put it all into fossil fuel type of things, but that's not

exactly the best way forward?

DAVIS: Well, we want to offer -- we want to offer investment products for clients based upon what aligns to their values. So we have a variety of

funds that are ESG-oriented. For those investors that want to have and invest with that style and that approach. But at the end of the day, when

we think about our active management, so when we look at fixed income, our analysts are constantly looking at a variety of risk factors -- credit

risk, the environmental risk.

And in an active fund, if it's not ESG aligned, the goal is to add value for our clients, and so if that risk is properly priced, and we feel like

the market at the end of the day is not reflecting that risk appropriately, we'll position the portfolio accordingly.

But again, we will invest in a variety of different sectors, different industries, different companies, but the goal here for active funds are

going to be to try to add value relative to their benchmarks, but those clients that want an ESG-type product, we have funds that are aligned with

their style of investing.

QUEST: Well, it is all then. Thank you, sir. I am very glad you came in. We need to check in again towards the end of the year, if we may, or at least

in the next year, so we have an update on where we're standing. But thank you, it's good to see you. Kind of you to come. Thank you.

DAVIS: Great seeing you as well. Thank you.

QUEST: Now, we were talking there about climate and one-and-a-half degrees of warming. Scientists have been warning about it for years, and in July,

we did get one-and-a-half degrees of warming.

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QUEST: One point five degrees, there is the number. It is over the pre- industrial levels. It's considered the tipping point for the environment.

Global temperatures reached that point in July, and if it continues, all sorts of devastating consequences have been forecast.

Now, if you look at the reasons and you look at what we've seen over the last -- we've got extreme heat, we've got drought, we've got flooding. You

can see the list over there.

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Dying coral reefs -- the whole lot. And the alarm just gets higher.

Bill Weir is in New York.

This concept, Bill, 1.5 degrees. The danger is, we get used to being over it.

BILL WEIR, CNN CHIEF CLIMATE CORRESPONDENT: Absolutely. Humans have this amazing tendency to normalize the horrible when forced to. And yes, this

would be very bad, if it sticks.

Thankfully, for the moment, this is an abnormally hot summer month, and the first summer month to go 1.5 over pre-industrial levels there. It'll go

back down and it'll probably break it again before the end of the year as the El Nino kicks in. But this is sort of that target laid out.

Now if you talk to climatologists, observers of this space closely, we're headed closer to 2.5, maybe a little north of that, less than three degrees

Celsius, which is a big win considering a few years ago, Richard, we were talking about four and five degrees of warming, which would make much of

the Earth uninhabitable, due to pledges, due to breakthroughs in technology, due to some tangible steps. At least we're not talking about

the horrible scenarios.

But this summer is showing, I guess, almost four out of five humans around the globe who have tasted a little bit of this temperature, it is a new

normal.

QUEST: Right. But let's be clear, 1.5 is devastating. The effects will be devastating. And yet, I hate for you to be the bearer of grim news, but if

we carry on as we are, and we don't get greater commitments at COP 28, COP 29 et cetera et cetera, we are not going to make it. Is that right?

WEIR: Oh, absolutely. At current burn rates, we will far overshoot the 1.5 and 2.5 and northward from there. Absolutely. And we haven't even hit peak

coal consumption around the world yet, Richard.

Those numbers in terms of planet cook and pollution keep going up. But look at the sea surface temperatures, all that squiggly spaghetti below is the

average over the last 20 to 30 years or so, and the red line at the top is where we are right now and it is going up, and because El Nino is just

beginning in the Pacific.

You'll hear from a lot of experts, scientists who say this is shocking, but not surprising. We've been screaming that this would happen, but it's

shocking to see it happen with such sudden burst the way it is now.

QUEST: Is there any shift because you speak -- I mean, you speak to both sides of all of this. Is there any shift in view from non-climate change

people in a sense, ordinary people? The people who just either don't believe it, or now believe it or whatever, that this year's extreme heat

and last year, people's views are changing, that there is a sort of come to Damascus moment?

WEIR: I believe there is. I was just reading the latest Pew survey recently, and in the United States where it's so politicized here, over

two-thirds of people are strongly in favor of renewable energies over the old fossil fuels. They're leery of transitioning too fast, like ending

gasoline car sales by 2035. About two-thirds of people are opposed to that sort of thing.

But yes, there is a mind shift because it's becoming harder and harder to ignore in so many places. And yet, when it comes to policymakers, when it

comes to corporations, and just the balance sheets, they show us their exploration budgets, it is very much business is normal for those folks,

for the petro states, for the big oil producers. Nobody seems interested in changing their business model.

Christiana Figueres, who was at the UN, head of the Paris climate talks for a long time, she said fossil fuel providers and producers need to be at the

table. She just wrote an op-ed a couple of weeks ago saying I've changed my mind. They show no signs of changing and they must be forced to do the

right thing. So, here we are.

QUEST: Very glad to have you with us today, sir, as always.

WEIR: Good to see you.

QUEST: Thank you.

WEIR: You bet.

QUEST: A combination of high cost and low production and the profit there by Barrick Gold. The international mining company posted a lower QE,

quarterly earnings although the results still beat analyst expectations and forecasts.

Since the end of Q2, gold prices have stagnated. They've now dropped at a one-month low. Mark Bristow is the CEO. He still believes of course that

gold and copper production are on track to rise this year in the second half. He joins me from Toronto.

I mean, we could talk about the sort of the mechanics of your production, but in terms of the product that you're bringing out, you have a big

problem which of course is that inflation comes down and therefore gold is no longer the hedge required in quite the same way.

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MARK BRISTOW, CEO, BARRICK GOLD: So hello, Richard. Long time since we've spoken.

First of all, just to put something to correct you and that is that quarter two, this last quarter is the highest average gold price ever for a

quarter, for three months in a row.

So, you know, everyone looks at gold and says it's not going up or it's not going down, or it's going up and down too fast. But, you know, it's

certainly at a high end of its profile, and some people will say it's going to go higher as the interest rates come off.

Some people say it's already higher, because the global economy is risk on at the moment, and there is no better way to see that when you listen to

Wall Street compared to the Fed.

So definitely a higher gold price scenario, and probably more upside, copper, just from your previous conversation is a critical metal and we

have both and are growing that production.

QUEST: Now, that is interesting. That is interesting, the sort of, in a sense, the production, whether it's raw metals, or rare metals, or -- the

production of those metals and ores required by the new digital economy is going to be phenomenal.

BRISTOW: Yes, and Richard, also to that point, sorry, to sort of pivot you back to your last interview.

QUEST: Sure.

BRISTOW: One thing that we all miss in the United States is that are we expecting to have all battery cars in California and condemn the rest of

the world to eternal poverty? Or do we appreciate that actually, to really deliver something that's meaningful for future generations, we need to

develop the world in a different way.

We need to industrialize not in the way that the West did in the last hundred years, and to do that, we need lots of mining, responsible mining.

And so this is a global story. It's a mining story. And we can have all of the IT in the world, but we also need the metals.

And so the argument is, and I agree with you 100 percent, we've got to focus on green energy, not green energy in our cars charged by dirty

energy, but green energy, green grids, more importantly, and copper is key to that.

QUEST: So one of the debates we've been having on QUEST MEANS BUSINESS is where, and I don't like really the phrase ESG because it brings in so many

other issues, but if we tighten to just climate issues, however you want to define that, where is this on your list of priorities?

You're going to tell me it's top five, probably, but where?

BRISTOW: Now, we are one of the few mining companies that have a real plan to get to 2030 on a plan of our reduction. And it's a managed plan, and it

actually gives a return. That's important.

So, you know, I've always said that if you don't have a clear destination, any road will take you there. So we have that plan. You know, you look at

the Paris Accord, it's the wrong place to have this conversation because it's a bunch of privileged economies trying to dictate to the rest of the

world that has no carbon footprint.

This is a real issue for the developed world, and one of the big challenges is how does the developed world create investability in the developing or

underdeveloped world?

QUEST: That is a subject for you and it to get to grips with on another day. I fully agree with you, sir. Thank you. Good to see you.

BRISTOW: Cheers, Richard. Thank you.

QUEST: Eli Lilly is raising its sales forecast thanks in part to demand for its diabetes drug, Mounjaro. The company's shares have popped up 15 percent

after reporting earnings this morning. It called the new drug one of its top new products and the drug is thought to have potential as a weight loss

treatment like Ozempic and Wegovy and others.

It hasn't been approved for that use, although a decision is expected later this year.

Wegovy has been approved for weight loss and shares of Novo Nordisk, which makes it are up, too, look 16 percent. A new trial found that the drug

could reduce the risk of heart attack and stroke, or heat related deaths by as much as a fifth. Huge and encouraging in terms of effects on patients,

and it could mean more health insurance providers agreed to pay to get Wegovy.

Meg Tirrell is our CNN medical correspondent. Meg is with me.

[15:25:10]

Now look, I find this very interesting because essentially, these drugs were diabetes related, and now what they're saying is, for those with

obesity, they could be assuming they are approved, be prescribed separately for those people who've got diabetes.

MEG TIRRELL, CNN MEDICAL CORRESPONDENT: Yes, that's right. Well, Wegovy already has that FDA approval for chronic weight management, is what they

call it. But essentially, it's for people with obesity or with a BMI that puts them in the overweight category, and they have some underlying health

condition as well.

And before, these were just approved for weight loss, and they really weren't getting a lot of insurance reimbursement because a lot of insurance

plans viewed this is perhaps just a cosmetic application.

But now for the first time with this hard study, we are seeing that taking Wegovy for patients who had prior cardiovascular disease, so they already

had a heart attack or a stroke or peripheral artery disease, this reduced their risk of having another heart related event by 20 percent. This is the

first time a clinical trial has ever shown this kind of benefit in patients who don't have diabetes.

Now, as you mentioned, this could be incredibly important for insurance reimbursement, this drug is not cheap. It costs $1,350.00 per month before

insurance, and not a lot of insurers provide it or pay for it.

So this is hope, that once this actually gets published in a journal, gets peer reviewed, the FDA puts in the label this could increase insurance

coverage.

QUEST: I know this is way down the line, but are we talking here about the potential for Wegovy to be prescribed for somebody who is not obese, who's

not got diabetes, but who might be at risk of heart disease or have cardio problems? In other words, I completely new genre of

patients/clients/customers/profits.

TIRRELL: Well, that is something that I have talked with obesity specialists about. Right now, as you pointed out, that is really far down

the line, and this trial was done in people who were obese or in the overweight category.

But I have talked with some doctors who say, what if we could treat this disease earlier in its course, so that we prevent these kinds of downstream

effects without waiting for folks to get into higher level risk categories? But we're going to have to see a lot more trials, I think before that would

really be something we see that's widespread.

QUEST: Fascinating. I'm grateful to you, sir -- ma'am, sorry. Forgive me. I'm just sort of thinking about the costs of it all and the insurance

implications. Thank you. Very glad to see you, Meg Tirrell. Thank you.

Italy is preparing to edge its banks with a 40 percent windfall tax. The Meloni government says the banks have failed to pass higher interest rates

on to their depositors.

Is that the real reason or is this just some form of extreme left-wing political philosophy from the Italian government dressed up as something

else? We'll talk about it in a moment.

It is QUEST MEANS BUSINESS and I am very glad you're on board.

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QUEST: Italy is preparing to slap a windfall tax on the money the banks are making from higher interest rates. The 40 percent tax comes after a bumper

first half for the country's lenders.

The Meloni government scolded the banks for charging higher rates on loans but not paying higher interest on deposits. It caught Italy's banking

sector by surprise. Countries like Hungary and Spain have enacted similar measures.

Silvia Sciorilli Borrelli is the Italian correspondent for the "FT."

This is interesting. Italy is not unique. Italian bank are not passing on the entire, if you will, gain on the interest rate but they have been more

egregious than most. They have actually been worse than the European norm.

SILVIA SCIORILLI BORRELLI, MILAN CORRESPONDENT, "FINANCIAL TIMES" That's correct but the right-wing government coalition has long blamed banks for

not passing on to the people the profits they're reaping.

Millions of Italians are paying more on their loans and mortgages and so this government is hoping somehow to send a message to people who are

feeling the pinch.

Whether it will work or not is the big question. I think the government will have to backtrack considering banking shares in Italy have plummeted.

The sector has shed more than 10 billion euro to date.

QUEST: What will they do with the money?

Because one of the things that all governments are grappling with is that it's very expensive to compensate or, if you like, make whole people on

higher interest rates.

BORRELLI: Absolutely, so what the government is saying is that these 2 or 3 billion euro, that is their estimate of what this tax would reap, would go

to cut tax for businesses and also help first-time home buyers with their mortgages.

So some sort of subsidies, especially, they say, for younger families. Whether that is doable or not, it is still to be seen. And also tonight, we

have seen the finance ministry say that this tax will be limited to 0.1 percent of banks' total assets.

So we really will have to see, assuming parliament passes this measure, whether the government will be able to reap the 2 billion euro that they

are expecting from this measure.

QUEST: Finally, were the banks politically naive?

Should the banks have seen this coming down the road toward them when they were deciding how much money to give depositors?

This was always going to be a potential thing from the government.

BORRELLI: Well, I do not think so. Actually, the finance minister went on the record about two weeks ago to say that a measure of sorts was not on

the government's agenda.

And up until this point, this populist, right-wing coalition had followed in the footsteps of their predecessor, Mario Draghi, who is -- was a

liberal pro-European prime minister.

So this was actually quite impossible to see coming.

[15:35:00]

BORRELLI: And also not at this point, right before the summer break.

QUEST: Fascinating. You will come back and tell us more I hope when we know whether parliament passes it. Thank you.

QUEST MEANS BUSINESS tonight: fans and mourners are gathering in the coastal island town today for an opportunity to say goodbye to Sinead

O'Connor.

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QUEST: Across Africa, there are countless artisans, who have mastered skills like weaving, dyeing and design. And yet they have no access to the

global market. A firm called All Across Africa aims to change that with the mission to help craftspeople sell more goods internationally. Anna Stewart

reports in today's "Global Connections."

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ANNA STEWART, CNN CORRESPONDENT (voice-over): Weavers in northern Ghana have been crafting baskets for generations. But they only began receiving

regular payments for their work, when these goods started lining the shelves of the world's biggest brands.

EUNICE AZUMA, ARTISAN, ALL ACROSS AFRICA (through translator): When there is a steady order, we are very happy because it makes us financially

stable. It means the children under the age of 18 don't have to be working with us.

STEWART (voice-over): Eunice works for a cooperative that sells home goods to a company called All Across Africa, which says it's one of the

continent's biggest artisan networks. The artisan sector is the world's second largest employer and can be key to lifting millions out of poverty.

But accessing markets is among the biggest challenges artisans face, according to one small survey.

ALICIA WALLACE, CEO, ALL ACROSS AFRICA: We provide training and a skill set to rural artisans, connecting them with the global marketplace.

STEWART (voice-over): Alicia and her cofounder launched All Across Africa in 2013, with the aim of creating jobs.

WALLACE (voice-over): I love this open weave detail that (INAUDIBLE).

STEWART (voice-over): The team started by exporting locally made goods abroad. But they soon realized that the secret to success is creating

custom orders for brands overseas.

WALLACE (voice-over): It's incredibly important to make our own designs because that's how we create a place in the market for ourselves.

STEWART (voice-over): All Across Africa works with over 8,000 artisans in three countries, selling their goods to more than 800 retailers worldwide.

Products are designed in the U.S. and then sent to the different country headquarters, which, in Ghana's case, is overseen by Oliver (ph).

He works with the master weavers and dye specialists to create a prototype based on the blueprints. Then he sends the materials to local cooperatives

to fulfill orders, anywhere from a few hundred items to tens of thousands.

OLIVER BENNEH, GHANA COUNTRY MANAGER, ALL ACROSS AFRICA (voice-over): Once the product is done, then we are able to price all material costs, labor

costs. That's how we come up with a very fair price.

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STEWART (voice-over): All Across Africa's wages are reviewed by Nest, a non profit dedicated to supporting handicraft workers, which uses over 100

metrics to measure ethical production. Eunice says the higher pay helped her build a house, send her kids to school and buy some livestock. It's

also created better working conditions.

AZUMA (through translator): We've been taught not to work more than eight hours a day. That has been helpful and we are happy. We used to weave

overnight and still not be able to sell enough.

STEWART (voice-over): Eunice prays that the work does not dry up, a responsibility that falls on Alicia's shoulders. Alicia works in the U.S.,

ensuring these products have places to be sold. She rarely gets to visit outer lands these days. But when she does, she always feels welcome.

BENNEH (voice-over): (INAUDIBLE) is about the people. Once you step in here, you become part of their family.

(END VIDEOTAPE)

QUEST: I love these stories, showing how people are helped to make greater markets.

Finally tonight, the fans of Sinead O'Connor gathered at the coast of Ireland to pay their last respects to the groundbreaking singer.

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QUEST (voice-over): The crowd sang along to "Nothing Compares 2 U," the song written by Prince, that O'Connor made her own. Her fans also spoke

about what set her apart.

UNIDENTIFIED MALE: I came up early to pay my respects to Sinead. The legend she was and certainly a great singer. She had a voice like a rock. She was

extremely talented and brilliant.

UNIDENTIFIED FEMALE: Sinead O'Connor, as I have now realized, was a prophet in my mind and up there with the best of them. And she was the most

courageous artist of our generation.

UNIDENTIFIED FEMALE: She was years ahead of her time. You know, standing up to gay burn on late late, like all the various things she did over time.

She was just -- it was OK to not be OK. You know, it was OK to be yourself and stand for what you believed in.

(END VIDEO CLIP)

QUEST: And I will wrap up the closing bell. We make a dash for the closing bell together in just 20 minutes from now. Coming up next, "CONNECTING

AFRICA."

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(CONNECTING AFRICA)

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[15:58:32]

QUEST: Hello, I'm Richard Quest. It is a dash to the closing bell. And we are only two minutes away.

Moody's has cut the credit rating of 10 small and medium size U.S. banks. Also supports six larger ones on a downgrade watch. It soured the mood on

Wall Street. And the Dow's been lower all day and now clawed back some losses.

The triple stack shows the averages are otherwise similarly down. Higher rates and choppy markets and downgrades, the last year has been tricky for

investors. Vanguard's chief investment officer manages more money than you and I will ever have. He told me the classic 60-40 portfolio of stocks and

bonds is still viable.

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DAVIS: Recognizing that, the year of 2022, we saw downturn in both the equity market and the bond market. But if you look over a longer period of

time, on a risk adjusted basis, a 60-40 portfolio for most investors, who are saving for retirement or their kids' college education, still makes a

tremendous amount of sense.

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QUEST: And the Dow components, Goldman is toward the bottom as today's downgrade shakes the banking sector; JPMorgan also as is AmEx and Visa

down. Now that we know Americans have more than $1 trillion in credit card debt.

Disney is up, it's reporting earnings tomorrow. And Amgen is leading the way on the market. We don't often see that kind of gain. And Apple has put

on a bit of weight. But then it's had so many losses of late.

Boeing is pretty much unchanged after the strong performance yesterday.

And that is the dash to the bell. I am Richard Quest, Whatever you're up to in the hours ahead, I do hope it is profitable. The closing bell on Wall

Street is about to ring. And there it goes. And Jake Tapper will have "THE LEAD" next.

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