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Quest Means Business

Hunter Biden Indicted On Three Gun Charges; Moderna Targeting mRNA- Based Flu And Cancer Vaccines; Arm Shares Surge In Biggest IPO of 2023; Call To Earth; Wyndham Introducing AI Chatbot For Guests; International Travel Demand Is Accelerating. Aired 3-4p ET

Aired September 14, 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: There is an hour left of trading on Wall Street and the markets are really sort of trying to find direction,

but today, they are more encouraged than they have been, and this arguably is because interest rates might be showing more certainty. At the moment,

we're up 370 on the Dow as you can see, a strong performance.

The markets and the main events. Perhaps it's the IPO sizzle that's driving Arm shares surge on the first day of trade. The chief executive of Arm is

with me in this program.

Hunter Biden has been indicted on federal gun charges.

The European Central Bank has raised rates to record levels, but says it might be finished after lifting them so high.

We are live in New York. It is Thursday, September 14th. I'm Richard Quest and I mean business.

Good evening.

Tonight,the biggest IPO of the year, has made a strong debut on NASDAQ. Shares in the chip designer Arm are up dramatically in their first hour of

trading. They were initially priced at $51.00, putting their company's value at around $54 billion.

The company's chips are found in nearly every smartphone around the world. The response of investors is good news for Softbank, which bought the

company for $32 billion and will retain 90 percent of the shares.

Wall Street is hoping today's reaction will help revive the IPO market that's dried up, if you look at those numbers, IPOs have been extremely

thin on the ground in the last few years. There have just been over 70 new listings this year, together, raising $15 billion.

Now compare that to '21, there were nearly 400 listings and they raised 140 billion.

Anna Stewart is in London. Why is the Arm one so insignificant?

ANNA STEWART, CNN REPORTER: Well, with these IPOs, you always wonder is it going to pop? Is it going to drop? More often than not they value is at a

place where it is going to pop and I think it's interesting to see where it currently stands, up around 15 percent, so around $58.00 a share versus

$51.00 that it was priced at this morning.

Is that money on the table or is that just a nice pop? It's somewhere on the edge. I look forward to asking -- you asking the CEO about that.

It is interesting if you consider that actually, Softbank poured a 25 percent stake that it didn't own in Arm very recently. The implied value of

Arm then, Richard, was $64 billion.

So actually it's valued at about where Softbank thought it was just a few weeks ago.

QUEST: Yes, I would say it's -- I would say, it is a good pop. It's not an indecent stand.

STEWART: It's not embarrassing.

QUEST: It is not an embarrassment in your eyes, which leads me to assume that they've mispriced in, but if we take a look at it, what does Arm do? I

know it does everything and I know its chips are in everything, but what does it do?

STEWART: It's in everything. It is the grand architect, let's say of chips. It doesn't make chips per se, but it's behind the technology in almost

every smartphone, and I believe on their website, they proudly say it's in about 70 percent of every device in the world or hit 70 percent of the

population of the world in terms of its technology.

Currently, it's very much focused on CPUs and smartphones, and it does extremely well with that, and royalties from it. Lots of money in that.

Where it wants to go and where it was really selling itself in its prospectus is artificial intelligence. The big growth story of the moment,

yes, it does currently support AI devices, but it's not necessarily making the same sorts of chips as NVIDIA or designing the ones that are the GPs,

the really high tech ones in the AI market.

So the issue for Arm right now is it wants to get into that market, but it's almost looking from the outside in at this stage and the smartphone

market, it is drying up a little bit. It's not a fast growth segment.

QUEST: Right.

STEWART: I don't know how long you've had your phone, but I've had mine for years. People aren't upgrading.

QUEST: A couple of years myself. The ultimate question of course is with AI, how all of these companies -- is there going to be enough from the

water to feed off?

[15:05:03]

STEWART: Well, there probably will and I think one of the big reasons NVIDIA failed and its bid to buy Arm last year --

QUEST: Oh, yes.

STEWART: For $40 billion, so a lot less than it is today is the fact that companies want to see more than one company own this space. There's

certainly room to grow, but NVIDIA is so ahead of the game. It is a huge market leader when it comes to the specific area of chips that are used for

AI.

So I think it's going to be quite hard for Arm to break into that, but it's still got the smartphone. It's just not as fast growth, perhaps as AI.

QUEST: Anna Stewart, thank you. We'll be talking to the CEO of Arm within the hour. Stay with us.

Rene Haas will be telling us what the company means on the market. If you're joining me at 3:30 in New York, that's in 25 minutes; 8:30, London;

9:30 where you are perhaps.

For the first time in US history, the Justice Department has indicted a son of a sitting president. A special counsel charged Hunter Biden with three

counts related to a gun he bought in 2018.

Biden is accused of lying on a federal firearms form and owning a gun while addicted to drugs. The president's son had previously struck a plea deal to

avoid facing a jury during a court hearing in July, that's when the agreement fell apart. The indictment could set up a trial during the

President Biden's re-election campaign.

Our CNN White House reporter, Priscilla Alvarez is with me. So what charges is he now going to face? And do we expect any more?

PRISCILLA ALVAREZ, CNN WHITE HOUSE REPORTER: Well, as you described there, he is facing those gun charges. And originally or perhaps a few months ago,

we have been talking about a plea deal and then that plea deal fell apart. So this has been an ongoing saga, and one that the White House has faced

multiple questions on because of his relationship with the president. He is the son of President Biden.

Now, when we asked the White House about this latest news, the White House spokesperson referred questions the Justice Department and Hunter Biden's

personal representatives saying: "Given this is an independent investigation." And that's really been the line from the White House this

entire time, is as this has played out, the White House has maintained that this has to do with Hunter Biden and his personal representatives.

But still within the White House, this is a sensitive issue; one advisers are well aware of and even so, despite all of this, the president has

remained close with Hunter, staying in touch with him.

We have seen Hunter and events at the White House as well. So even so, the president is still in close touch with Hunter. It's just that this timing,

as one source told me is disappointing.

Of course, their focus is on Bidenomics. You see the president soon is going to speak on this in a speech where he's going to focus on the

economy. So that is where the White House wanted to spend their focus today, it was creating a difference, a contrast with Republicans in what

they now call Bidenomics versus Maganomics.

But instead, all of this is happening just minutes before President Biden is expected to speak. It's his first public appearance, of course, since

this news broke. So we'll see if he says anything at the top.

QUEST: He can't really wink, can he? I mean, in the sense that it is his son, he has to defend his son, at least on a filial sense. The opposition

is going to go absolutely hell for the leather to make whatever case it can. So how difficult a time is this for the president?

ALVAREZ: It's certainly difficult politically and personally. But again, when you talk to sources and when I talk to sources about this, what they

really want to maintain is the focus on the White House agenda.

Of course, that is an expected line that you'll hear from sources close to the White House, that who we will also note that Republicans will seize on

any issue that could be seen as sensitive, delicate, difficult for this White House, including this one.

Recall that just this week, House Speaker Kevin McCarthy said he would open an impeachment inquiry into another matter involving the president and his

son, Hunter Biden.

But for now, at least, what the focus is going to be on is what we're going to see this afternoon, the economy and what they think they can tell

Americans to gain traction and win in the re-election.

But again, a source close to the White House telling me is the timing of this indictment is still a disappointment.

QUEST: Thank you. Good to see you. Thank you very much.

The European Central Bank has raised rates to the highest level in the bloc's history. It increased its benchmark a quarter percentage point. It

brings it to 0.4 percent, and in doing so, it signaled that it was likely done raising rates and were keeping them at this level for a longer period.

The ECB's president, Christine Lagarde said they don't want to bring about an economic downturn.

(BEGIN VIDEO CLIP)

CHRISTINE LAGARDE, PRESIDENT, EUROPEAN CENTRAL BANK: Inflation has declined and we want it to continue to decline and to reinforce that process.

[15:10:10]

And we're doing that not because we want to force a recession, but because we want price stability to be there for people who are taking the brunt of

inflation, high prices, and predominantly so those who are not the most privileged people.

(END VIDEO CLIP)

QUEST: Rana is with me. CNN's global economic analyst and associate editor at "The Financial Times."

Christine is very good. Christine Lagarde is very good at putting it into plain English, isn't she?

RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: She is.

QUEST: Making it relevant as to why they're doing it, but are they being a bit previous in signaling that they've finished?

FOROOHAR: Well, I mean, this is -- listen, this is certainly a hawkish stance. You know, this is the highest rates have been in memory, really, in

Europe. And I think that what it says, at a global level is that you're probably going to see stagflation in the EU, whereas the US is really in a

period of, you know, Goldilocks, once again.

I think that you're probably going to see a little more of a dovish sentiment on the part of the Fed, so that brings into focus, I think, more

of this divergence between the fortunes of Europe and the US right now.

That said, I think Christine is absolutely right that average people, and particularly in Europe, which is, you know, many countries are just not as

prosperous as the US are feeling the brunt of cost of living inflation in ways that are not as severe in some ways in the US.

QUEST: The policies that they put in place at the ECB are designed to push down to two percent. Is it your feeling they are going to keep going to two

percent?

FOROOHAR: I think so. I think, you know, inflation is about a lot of things. Some of it is metrics, some of it is emotion, and I think in

Europe, and particularly in Germany, there's still a feeling of we've got to get inflation under control, you can't have inflation out of control. So

I think that they're going to err more on the hawkish side.

You know, it'll be interesting to see what that does to labor markets. Again, in the US, there's now this sort of interesting debate about how the

relationship between inflation rate hikes and the employment market just doesn't seem to be holding. You've had some hikes in the US, and you still

have a really pretty strong labor market.

So it feels like the conventional wisdom of the past is really up for grabs right now.

QUEST: Okay, the way in which the rates have risen at such a fast clip, and you're right, we have not seen the attendant, one would have thought would

have seen a much stronger downturn, bearing in mind what's happened.

FOROOHAR: Yes.

QUEST: And I suspect, economists will be researching this for decades.

FOROOHAR: Well, I think that that's probably true, and we also have to remember, this is a weird period, even if we hadn't have had COVID or the

war in Ukraine and all the attendant supply chain issues, we already had a trade war between the US and China. We had easy money policy for a decade

and the brakes was being put on that.

So almost every vector that you can imagine in the economy is in play right now. And of course, I haven't even mentioned technology and AI, which we've

spoken about before. But it's one of those periods, as fascinating as an economic reporter to be thinking about this, but you know, you can put your

finger in the wind and make a prediction and be completely wrong and the experts are on either side right now, so very unusual here.

QUEST: What do you make of the Arm IPO?

FOROOHAR: Oh, you know, good thing for the UK. You know, we've been waiting for this for some time, but I think that it gets the intellectual property

issues, it gets it who's going to be ascendant in technology, what tech stocks are going to do in ways that are also incredibly unpredictable, and

more and more bifurcated country to country than they have been in a while.

QUEST: Good to see you. Thank you so much.

QUEST MEANS BUSINESS tonight, Moderna is pushing to bring its trademark technology to fighting a great deal more than COVID. The progress on

vaccines against the seasonal flu and even cancer, in a moment.

(COMMERCIAL BREAK)

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QUEST: Moderna says its experimental flu vaccine is outperforming traditional ones in a clinical trial. The new vaccine uses the same mRNA

technology as its COVID shots and the company is looking to apply it as well to a more ambitious target, cancer.

Moderna signed a deal this week with a German drug developer to work on those vaccines and treatment.

Meg Tirrell Allah is our CNN medical correspondent and joins me now.

I always take these stories with greater optimism and a pinch of salt in a sense, because somewhere in all of this, it comes -- it comes a line that

is not going to be ready for many years, but this is improved -- this is progress.

MEG TIRRELL, CNN MEDICAL CORRESPONDENT: It is progress, and actually, this is moving so quickly that Moderna says it's rushing to get the

manufacturing in order in case they get an accelerated FDA approval specifically for their cancer treatment in melanoma.

We sat down with Moderna CEO, Stephane Bancel and we talked about how this individualized mRNA cancer treatment works. The challenge of manufacturing

a drug that's an individualized treatment different for every patient, and also what the potential limitations to mRNA technology and medicine are.

Here's what he said.

(BEGIN VIDEO CLIP)

STEPHANE BANCEL, CEO, MODERNA: We'll make a product that is individualized because you and I, even if we have both cancer, we end up having different

chemical product, that product is injected intramuscular. It's the same technology, the same lipid as COVID, RSV, or flu.

What those products do once in your body? We've now demonstrated that clinically. This basically activates your T-cell to help your immune system

fight your cancer directly.

So the product we make is not directly from medicine, but it is the tools for your immune system to recognize the mutation on your cancer cell that

it did not recognize before that it can take care of your cancer.

And the other thing we're doing is of course, getting manufacturing ready, because if we get an accelerated approval by regulators, and we cannot make

enough products that will be terrible from a public health standpoint.

TIRRELL: We've seen that happen in personalized cell therapy.

BANCEL: Correct, which is why we put this amazing Moderna team that has done remarkable work during the pandemic to scale up, as you remember, so

fast manufacturing. That same team is actually leading the charge on the commercialization efforts in a brand new plan.

TIRRELL: Have you encountered a place where you know, there is a limitation to what mRNA can do in medicine?

BANCEL: So there are places where we don't know yet how to solve the delivery of EMR, and I think that's really the biggest technical challenge,

is can you get enough mRNA in the cell where you need it to make the protein that will do the medical intervention? And that's really the big

question.

You know, do we know how to get mRNA into the brain? We don't yet. Are we working on it? This is the type of technology and science we want to keep

investing on. What we have done, we're investing in science, we're just actually getting started.

(END VIDEO CLIP)

TIRRELL: So that is some of the challenges they will be working on farther off, but in terms of the cancer applications, those are pretty near term

and the results that they've seen in melanoma in particular have been very promising on top of Merck's Keytruda, which itself is a very promising

immunotherapy drug, a very powerful immunotherapy drug. They're also starting to look at lung cancer.

[15:20:15]

QUEST: The potential is absolutely vast here, isn't it?

TIRRELL: It is and Moderna is not the only one working on it, Biontech, of course, their competitor on the COVID vaccine is also working on these

personalized cancer treatments, too.

QUEST: Thank you.

Russia says it's repelled a Ukrainian attack in the Black Sea. The Defense Ministry says one of its patrol ships destroyed five marine drones, and as

both sides burn through weaponry and ammunition at a breakneck pace, Ukraine's allies are working to keep the country stocked with munitions.

Clare Sebastian is in London tonight.

We've never seen anything like the level of munitions that they're all using. Is it sustainable?

CLARE SEBASTIAN, CNN CORRESPONDENT: That is really the big question, Richard, is how far to ramp up what is possible, and then how much risk

should be taken on? How long do you keep doing this with of course, the prospect in the future, it doesn't seem like that's anywhere close right

now, but of course, this war could end or the fighting could subside in some way.

This is something that even as we watch the fighting, this ammunition heavy-ground artillery battles continue all along this 800 mile frontline,

it's happening as we speak. This is something that's consuming the weapons producers in NATO countries.

The gap between what the Ukraine needs and what they are able to produce, it's narrowing, but it is still very large indeed and it is fundamentally,

Richard, reshaping the landscape for these companies. Take a look.

(BEGIN VIDEOTAPE)

ARMIN PAPPERGER, CEO, RHEINMETALL: Yes, this is ammunition but without power, you cannot fire this ammunition.

SEBASTIAN (voice over): I mean, the high tech displays at the sprawling International Defense Expo, the head of Germany's top weapons producer has

a much less futuristic battle on his hands, to keep up supplies of these NATO standard 155 millimeter artillery rounds, the lifeblood of Ukraine's

defense, and now its counteroffensive.

PAPPERGER: We doubled or tripled our resources, our capacities. We are able now to produce next year 600,000 artillery rounds.

SEBASTIAN (voice over): He says that's more than six times their pre-war output, not yet enough, though, to clear a multibillion dollar order

backlog.

PAPPERGER: Three years ago, everything thought we can do everything with Air Force. It's not possible. Yes, we need strong land forces and this is

exactly what we produced.

SEBASTIAN (on camera): Are governments and is the EU doing enough? Do you think they woke up quick enough to this production crisis, you could call

it?

PAPPERGER: The EU made decisions, and they said, okay, we want to invest. There are -- we are still waiting at the moment for the final decisions.

SEBASTIAN (voice over): Ukraine can't afford to wait. The government tells us they're firing five to six thousand of these rounds a day, but would

like to be firing more than 10,000, much more than is currently being produced by its NATO allies. Russia, meanwhile, is firing 40,000 rounds a

day Ukraine says.

Manufacturers in the US, Ukraine's biggest backer have also rapidly scaled up, not fast enough, though, to avoid having to sub in controversial

cluster munitions this summer.

JAKE SULLIVAN, WHITE HOUSE NATIONAL SECURITY ADVISER: We would provide cluster munitions, because the alternative to providing cluster munitions

was them not having enough bullets.

BRIGADIER GENERAL JOHN T. REIM, US ARMY: We were at 14,000. You know, we are at 24,000 today, next month, we will be at 28,000. So we've doubled our

monthly output. You know, that's quite significant. Some of these more longer term investments beginning of next year, we will start realizing

additional capacity.

PAPPERGER: I think we are in a phase of right now, of an industrial war. Work capacity is the big issue.

SEBASTIAN (voice over): Norwegian co-owns Nammo, another major ammunition producer in Europe says it has gone from making just a few thousand rounds

a year to a rate of 80,000 a year.

PAPPERGER: This is totally changing our company. We are investing at some sites 15 to 20 times more than we normally do in order to build capacity.

SEBASTIAN (on camera): When you look at what's happening now with the counteroffensive, they are moving relatively slowly. The fact that it had

start later than planned, President Zelenskyy says because weapons deliveries were delayed, does that concern you?

PAPPERGER: To me, it is a major concern. Of course, we see the consequence in the battlefield. So, I think we all in the western society has a common

responsibility to step up this capacity.

(END VIDEOTAPE)

SEBASTIAN (on camera): So Richard, the picture is improving. These companies tell me the EU has just announced eight joint procurement

contracts. Rheinmetall says in a recent week, in the space of one week, recently they signed $7 billion worth of contracts.

[15:25:11]

So the contracts are coming in, but as I said, the gap is still there. Ukraine wants around twice as much as it is able to fire right now, and we

see it playing out in front of our eyes on the battlefield.

QUEST: Is it realistic? Is it realistic? I mean, can the West actually supply that?

SEBASTIAN: I mean, look, I think right now, we are seeing them calculating these companies, calculating how far to go, how far to ramp up.

Rheinmetall, for example says that it is going to be producing 600,000 a year by next year, which is an extraordinary amount, but after that, they

are only really planning to add another 100,000 on top of that.

They're looking at a sort of five to 10-year horizon for this level of production, Richard. They want longer contracts from governments to be able

to sustain it and they want a closer partnership with governments moving forward, more on the sort of US model where the governments are sort of

working in tandem with the Defense industry because of course, this isn't just about Ukraine, we are seeing a fundamentally different security

picture in Europe.

NATO is looking at having increased stockpiles going forward because of the threat from Russia.

So this is the picture and this is the sort of calculations that are happening behind the scenes with these companies.

QUEST: Clare Sebastian, thank you.

Coming up in a moment, Arm shares are surging in the biggest IPO of the year. The company's chief executive will be joining me after the break.

(COMMERCIAL BREAK)

QUEST: Hello, I'm Richard Quest. There is more QUEST MEANS BUSINESS in just a moment. The chief executive of Arm is with me. He has just pulled off the

year's biggest IPO.

And your next hotel concierge will be a robot. The CEO of Wyndham will tell me how his hotel and company is using artificial intelligence to improve

the guest experience, what should I think of that?

Before that, this is CNN and here, the news comes first.

The former President Donald Trump will not be headed to trial in Georgia next month. Today, a judge ruled Trump and 17 of his co-defendants will

have their trials severed from two co-defendants who are having their cases heard in October.

While new trial dates have not yet been set, it's likely it won't happen until well into next year.

Doctors Without Borders now estimates the catastrophic flooding in Libya has killed at least 8,000 people. It says another 10,000 are missing when

the northeastern part of the country was struck by heavy rain, which caused two dams to burst.

The International Red Cross as the city of Derma was then struck by a seven-meter wave of water.

The Big 3 US automakers have just hours to avert a strike. The United Auto Workers Union says it will conduct a targeted strike if there is no

agreement with the companies by midnight in Detroit and Michigan. Even a targeted strike at select plants could shut down years production for

General Motors, Ford, and Stellantis.

[15:31:11]

(MUSIC PLAYING)

QUEST: Our top story, Arm is celebrating its IPO. The company's executive rang the opening bell on Nasdaq and the shares are now up a respectful 17

percent. It's a cap of $60 billion, the company designs chips and choosing artificial intelligence that many investors hope to profit from that.

Rene Haas is Arm's CEO and he joins me from Nasdaq.

First of all, congratulations. I think you've priced this -- or your bankers priced it rather well. Nothing annoys me more when I see a massive

40 percent to 50 percent pop and I think they've got it wrong. But this is a decent stack on the day.

RENE HAAS, CEO, ARM: Well, thank you, Richard. We're very happy about today. It's a great day for the company, it's a great day for employees.

It's a great day for anyone who has worked for Arm in our 33 year history.

It's my first time through an IPO process. Our bankers say, if you can price it at the high end and go out at that number, it's a good thing and

that's where we ended up. So couldn't be more pleased.

QUEST: Now I get to the tricky bit.

What does Arm do?

I can watch the (INAUDIBLE) every smartphone and this, that and the other.

But how would you describe what you do and how would you describe your area of growth?

HAAS: We build CPUs, Richard, the brain of every modern digital device. I think over 70 percent of the world's population uses Arm in some way, shape

or form. And the CPU is the brain of that electronic device.

It makes your smartphone go, it your PC go, it makes your Nest thermostat go, it makes your autonomous vehicle go. You can't run an electronic device

without a CPU and that's what Arm does and we're the most pervasive, popular CPU architecture in history.

QUEST: I was noticing those who took those who were involved in today's IPO, including Nvidia, Apple, they all bought shares within it.

They are partners or competitors?

HAAS: Yes, it's a great question. We had a very, very broad set of partners, who are strategic investors. And I think it attests to the fact

that we play in so many ecosystems. People who make chips -- Samsung, Intel -- companies that help you build chips.

Companies that are big large franchises around software, Google and Apple, and also Nvidia. They are all reliant on the Arm CPU in one shape or form.

So you can see to the testament just how broad and pervasive we are based upon the list of people who are now our strategic investors.

QUEST: Now we're getting to it. Now I'm starting to understand that actually it's the CPU that takes the chip from wherever and actually

provides the brain.

HAAS: It is the brain. And without the CPU, no electronic device can run. It's the simplest way to think about it.

QUEST: So how fast do you have to run to stay ahead of the competition?

HAAS: It's a never changing game. The CPU gets faster but, at the same time, the CPU needs to be efficient, meaning it needs to be low power.

You know, one of the stories I love to tell is the fact that Arm 33 years ago started from a company that was designing a chip for a device that was

designed to run off a battery. And that's why we are so popular in smartphones and did so well. But fast-forward in this era of

sustainability, efficiency really matters.

[15:35:00]

HAAS: The cloud data center needs lots of power but can't really have a lot of electricity burdens. Your electric car runs on a battery and needs to

sustain energy while still being computer intensive. That's all good for Arm because we're the computer inside all those devices.

QUEST: AI is the novarna (ph) at some point. All roads lead to discussions of AI.

When you're at the White House summit, talking about regulation of AI, proper regulation of AI, where do you stand?

HAAS: You know, the obvious trend I think is that AI, which has always been in our lives, has now reached an accelerated point, where the technology is

moving at such a rapid pace, computers are becoming smarter and smarter, that figuring out how to regulate them or put ethics around them is a real

problem set.

And I think it's great that governments are figuring it out, that a lot of companies that need the system are. This is a complex problem that requires

a lot of stakeholders to be involved in.

We're part of that too but it's also early days because we're broaching in an area that we really don't know what all the answers are. But we're doing

the right things initially. People are talking about it, getting the problem statement out there and trying to figure out some solutions.

QUEST: Right. But to go to the very first part of that, do you accept there needs to be proper regulation?

HAAS: I think that at some level there does need to be. My analogy might be, back in the day when there weren't speed limits, you didn't have lanes

drawn for cars like you did for horses. The world had to figure out for this modern piece of technology, which largely can do good for mankind

needed a set of rules.

AI to some level, particularly at the level we're talking about now, computers that can think to the level of humans, that does require a new

set of rules and ethics to understand how to maximize its benefit.

And I think the benefit, by the way, is going to be enormous.

QUEST: That's something I'm hearing again and again. I was in Israel this year, talking to the largest investors there. And everybody says that AI,

we've not even scratched it. This is a revolution like nothing else we've ever seen.

And yet you and I are old enough to have seen the dotcom -- the information superhighway. And we remember those days but now you've got something on a

different level.

Do you think it's going to be on a different level?

HAAS: I do. Yes, I remember the dotcom boom very much so. And there were all kinds of companies trying to figure out how to build a business on the

internet. But fast-forward to today, the internet on your smartphone, there's very little one can do if you don't have that.

And I think going forward, AI will be similar not in terms of its device needed but it will be able to make our lives easier, help in terms of

health research, it will help in terms of sustainability, it will help in so many ways.

So, no, while I do not think that the hype cycle is overdone, it's going to take some time. But I do think we are in for a very exciting ride around

AI.

QUEST: Right. But we will also have problems with protections in China, because if AI is as significant as it is, I'm guessing you don't want your

best stuff getting to people who you might not want to have.

How concerned are you that we are building protectionism, albeit legitimate protectionism but at the same time putting up walls, again, arguably

legitimate walls?

HAAS: And at Arm, we're at the center of this because any type of AI requires data to make decisions and basically have an intelligent computer.

So I think one of the things you're going to see is more and more around security and data privacy because these AI machines are only as good as the

data that they work on.

And it's natural to assume that because Arm is 70 percent of the world's population of using CPUs and data, that almost all of the data highway

passes through Arm. So this is something we're thinking very deeply about.

Where do you stand?

Obviously you follow the rules wherever you are.

But where do you stand?

HAAS: Arm is a global company and most of our employees are in the United Kingdom. I live in the United States and I'm in the United Kingdom all the

time. But we have employees all across the globe.

[15:40:00]

HAAS: So we need a global mindset when we approach these things.

QUEST: Is it a hindrance, the U.K., not being in the E.U. anymore?

Or is it just one of those things you've learned to live with, it's a fact of life?

HAAS: I'm very much a pragmatist. Brexit happens so let's figure out how to deal with it going forward. You know, Arm has a huge footprint in the U.K.

and we're growing. Most of our employees, as you might be aware, are in Cambridge but we're expanding across the U.K.

We've just opened a very large new design center in Bristol to the west of London. So, for us, we're very committed to the United Kingdom.

QUEST: I shall play nice and not talk about the next year's election. We'll save that for the next time we speak. Thank you, sir, it's good to talk to

you. And congratulations. It's not often we see an IPO, the prices so they're what one might describe, you have 18 percent but your prices are

respectable pricing. It's a nice bump for your investors.

Thank you, sir.

HAAS: Thank you so much.

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QUEST (voice-over): At QUEST MEANS BUSINESS from New York, forget about the concierge. Wyndham Hotels is introducing a chatbot to answer your

questions. (INAUDIBLE) The company's CEO will be live (INAUDIBLE).

(MUSIC PLAYING)

(COMMERCIAL BREAK)

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QUEST: (INAUDIBLE) climate goals set out in the Paris agreement would be easy. A recent U.N. report says global carbon removal needs to ramp up to

75 million metric tons annually by 2030. That's a massive jump at the current rate.

Less than 1 million tons are being removed each year. In Scotland, one startup has developed a simple carbon catcher solution. It uses the

planet's most abundant resources, basalt rock.

(BEGIN VIDEOTAPE)

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BILL WEIR, CNN CHIEF CLIMATE CORRESPONDENT (voice-over): Over millennia, volcanic rocks have formed some of Scotland's most spectacular sites,

stunning coast lines and historic landmarks, remote islands and iconic mountains.

But now they could also provide a solution to the urgent global need to pull carbon out of the sky and lock it underground.

JIM MANN, FOUNDER AND CEO, UNDO: (INAUDIBLE) weathering (ph) is a natural process. So CO2 in our atmosphere combines with water and vapor in our

(INAUDIBLE).

[15:45:00]

MANN: And they will react to form a weak carbonic acid. That reacts with certain types of rocks to remove CO2.

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WEIR (voice-over): Scottish company UNDO takes that natural process and dramatically accelerates it. By grinding down volcanic products like basalt

into a fine powder, the surface area increases. So when the rock dust is spread across agricultural land, there is more contact. Rainfall and CO2

and vastly more carbon is captured.

UNIDENTIFIED MALE: In its powdered form, kind of like coffee or tea in the morning, if you're trying to make a brew, you put the coffee beans in and

you can leave it in hot water for a long time. You're not going to get a very potent drink.

But if you crush down your beans finely, you unlock those reactive surface areas and then you can mass, even create a very potent brew very quickly.

MANN (voice-over): When we're putting the basalt down on agricultural land, we typically apply it at about 20 tons per hectare. And that's across the

whole farm so thousands and thousands of hectares now.

And we're spreading about 30,000 tons of silicate rock every month now. So that 30,000 tons will be in the somewhere region of 7,000-8,000 tons of

CO2.

UNIDENTIFIED MALE (voice-over): We have developed a detailed geochemical model to enable us to predict multiple decades into the future how much

rock has been weathered.

So from current finding, there is huge potential for enhanced rock weathering. We could contribute to 5-10 gigatons annually of carbon dioxide

removal in the future.

(MUSIC PLAYING)

WEIR (voice-over): If UNDO is able to achieve those numbers, they would indeed undo a lot of the damage done by global carbon emissions. But

there's a notable benefit for farmers, too. Trials have shown that fields with the basalt spread have produced a 10 percent to 20 percent increase in

crop yield.

UNIDENTIFIED MALE (voice-over): The farm is critical and having something that really benefits the farmer just makes our job so much easier. First

and foremost, we're a climate company but we need to give value to the farmers.

And doing that is great and it's so nice to see farmers who maybe put one field with us come back to us and then say we want the whole farm done,

please, as soon as you possibly can.

WEIR (voice-over): UNDO is already operating in the U.K., North America and Australia. But as the most abundant rock on the planet, it is clear they

have barely scratched the surface of basalt's potential.

(END VIDEOTAPE)

QUEST: For more from Call to Earth, please, cnn.com/calltoearth.

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[15:50:00]

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QUEST: Now we've been talking about Hunter Biden. And his lawyer just responded to the client's indictment. He says they can't defy (ph) the

claims and he's blaming MAGA Republicans and improper partisan interference.

Biden is accused of lying on federal firearm forms and then he get done well (ph) (INAUDIBLE) drugs. He had previously struck a deal to avoid a

trial.

Your next hotel concierge might be a robot. Wyndham says its new AI platform will answer common questions you have during your stay. The

company says it will free up human workers for other guests' needs. It's also getting new technology to its hotel owners, tools that will let them

upsell customers on upgrades before they even arrive.

The investors seem to believe -- the shares are up nicely -- Wyndham made this announcement at its global conference in Anaheim. Chief executive

Geoff Ballotti is with me.

It is always good to see you sir.

GEOFF BALLOTTI, CEO, WYNDHAM HOTELS & RESORTS: Always good to see you, Richard. I woke up the other night -- I can't remember where I was -- and

you were on horseback in Mongolia and you looked very comfortable on that horse. It looked like you wanted to ride and not be led.

QUEST: Well, tell that to the horse. Yes, thank you.

Look, sir, I hear what you're doing with AI and I hear what you're doing with the bought. But my experiences of bots are such that they rarely

answer the question. It always ends up with some -- what time does the swimming pool open maybe?

How do you make it relevant?

BALLOTTI: Well, we believe we're making it relevant for the 6,200 small business owners who are here with us on the largest trade show floor in the

industry that's ever been put together and the largest gathering of hotel owners.

We're the world's largest hotel franchising company. And our guests believe that they're dealing with what a company that is providing them with real-

time information and chat AI today is handling up to 50 percent of their questions, including the question you just asked.

Is the pool open, is it not?

Is breakfast included, is it not?

Are pets allowed in your hotels?

So to the extent that we could free up for our hotel owners the manual in the hotel requirement for us to do that and provide that chat AI and

provide that more timely response is something that they're thrilled with and that certainly our guests are thrilled with as well.

QUEST: But providing it's not being used by owners as a way of cutting back on the staffing in a sense, so that when you do require, when you do

require manual assistance -- because how many times have you had -- "your call is very important to us, please remain on the line."

And I immediately want to say, well, if it's so bloody important, answer it.

BALLOTTI: Absolutely. You make a very valid point. And the -- look, we are not mandating technology to our owners. We're looking for our owners to opt

into our technology.

And the most, to your point, Richard -- the most annoying thing is when we're checking in.

When you're checking into a hotel, that that guest service agent that is aligned with you face to face, has to -- to your point -- take a

reservation call; 4,600 of our owners have opted in to that call bouncing to a professionally-run call center which is run by some of the best call

center leaders that this industry's had.

To take the call so the guest service agent in front of you, Richard, does not have to interrupt that check-in; 4,600 of our 6,000 owners here are

using what we call our signature reservation service.

That's providing them with the ability to provide the service to the guests and not have to interrupt that transaction that you're worried about.

QUEST: What's the one thing --

(CROSSTALK)

QUEST: -- in the post pandemic world -- and, you know, I mean, we thought '21 was going to be the big year for Europe and it wasn't, it was '22. And

now '23 has been a very big year; likely '24 will be another monster year.

What is it people are looking for?

[15:55:00]

BALLOTTI: People are looking for value. I mean, in Europe today, we're seeing double digit demand growth. Our available room across the European

hotels that we operate in are up double digit to where we were pre- pandemic. People were looking for that value, people are looking to get away, people are looking to travel.

We're seeing big, big uptick in southern European destinations right now as people start planning their fall and spring travel. And they're looking for

service, they're looking for value and they're still, to your point, we do believe that 2024 is going to be a big year; '23 is proving bigger than I

think a lot of us thought.

And '24 is looking really, really strong.

QUEST: We need to talk further on these issues, sir. But I'm grateful for your time tonight, thank you very much.

BALLOTTI: Thanks for having us, Richard.

QUEST: Thank you.

We'll be right back after the break.

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(COMMERCIAL BREAK)

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QUEST: Tonight's Profitable Moment: I'm going to draw two strands together for tonight's program. Arm: now I finally understand what Arm does. I know

it sounds really stupid. It's a chip company but not really; it's a CPU company and it makes -- it takes chips from everybody else and puts them

into the CPU brain.

And that's why it's been so successful and we saw its pop today and it was a respectable pop, 15-20 percent in my view is a respectable pop for any

stock on an IPO. Any more than 20 percent and you left money behind. But I think they priced it well.

Arm is one of those sensible companies that gets it right. Now well, maybe not. (INAUDIBLE) coming up toward the closing bell. Related to, this of

course, is this whole idea of the chatbot. A chatbot is going to use AI and CPUs and chips.

And it's all going to come together and what I find fascinating is no one has got any idea where this is going.

I mean, truth, do you?

We know it's going to be very big, we know it's going to be very important. But I still shudder at the thought of having to talk to a chatbot because I

know invariably it's going to end up with me pushing 0 or doing something to speak to an operator. And there won't be one available. Oh, well I'm

old-fashioned.

And that is QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York. Whatever you're up to in the hours ahead, I do hope it's profitable.

The closing bell is ringing on Wall Street there it is good nice solid gain on the Dow of 300 points.

END