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Quest Means Business
UK Foreign Secretary: Red Sea Attacks "Need To Stop"; Houthis Launch Fresh Drone Attack On Red Sea Shipping Lanes; Pro-Iran Militia Base Struck In Baghdad, Two Killed; ISIS Claims Responsibility For Deadly Bombings In Iran; Annual Inflation Rises In Germany And France; Norse Atlantic CEO: We Expect To Make Money In 2024; New Batch Of Jeffrey Epstein Documents To Be Released; Kia And Hyundai Thefts; Gen Z Drives Demand For Second-Hand Goods; Jeffrey Epstein Documents Unsealed, Associates Made Public. Aired 3- 4p ET
Aired January 04, 2024 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:27]
RICHARD QUEST, CNN INTERNATIONAL HOST: One hour of trading still left on Wall Street, and it's Dow's first positive session of the year. 120, not
bad and all things considered. Bearing in mind the loss of the last couple of days. But those are the markets and the events that we're watching
closely.
Houthi rebels launched new drone attacks in the Red Sea. The chairman of the world's biggest shipping management company tells me it's impossible to
keep ships safe.
European inflation on the rise. High numbers from Germany and France.
And one man's trash is another man's treasure. The CEO of Goodwill tells us about the boom in secondhand fashion.
Live in New York, on Thursday, it's January the 4th. I am Richard Quest, and I mean business.
Good evening. Tonight, every economy will suffer. That's the warning from the British Foreign Secretary, Lord Cameron, if a spate of attacks on cargo
ships does not end soon.
You're familiar. For weeks now, shipping lanes in the Red Sea have been targeted by drone attacks from Houthi rebels based in Yemen, supposedly in
solidarity with the Palestinian people. The latest such attack came just this morning.
Tonight, the head of one of shipping companies' -- largest management companies tells me the disruption will have big significance for world
trade.
Let me show you exactly why if I can do so on here. We begin, of course, if you are going from Singapore up through the Suez Canal, say, to Rotterdam,
now, that will take you, I don't know, anywhere -- let me see the number. It takes you a certain number of days. It takes you may be up to 30 days,
all right, to make that trip.
However, if you then have to go from Singapore right the way down around and then to Rotterdam that way, that can take up to 47 days. As you can
see, a sizable difference. It's been 30% more. I realize that's a little bit messy to show you. That's the one route, and that's the other. And that
gets even more so when you think about going to, say, for example, North and South America.
The reality, of course, is that shipping rates, because of the potential for all of this, and ships now going that other route have doubled.
Britain's Foreign Secretary David Cameron says every economy could be affected and is warning of the consequences for those responsible.
(BEGIN VIDEO CLIP)
DAVID CAMERON, BRITISH FOREIGN SECRETARY: It's quite clear to me that this is unacceptable. This is illegal. It's not to do with Gaza. It's not to do
with Israel. This is about the freedom of navigation. This is about the ability of ships to carry their cargo.
The world economy -- every economy will suffer if ships keep coming under attack in this illegal and unacceptable way. And these attacks need to stop
or actions will be taken.
(END VIDEO CLIP)
QUEST: The CEO of Optimum Maritime Holding says it's hard to guarantee safety for ships in the Red Sea. Their subsidiary manages around 1,000
vessels, including those that pass through the Red Sea. Bjorn Tore Larsen sat with me here in New York and said, like the foreign secretary, if the
shipping is to continue through the Red Sea, the attacks must be stopped.
(BEGIN VIDEOTAPE)
BJORN TORE LARSEN, CHAIRMAN & CEO, OPTIMUM MARITIME HOLDING: Well, it's a terrible risk obviously, and we are managing a lot of ships that also pass
through the Red Sea. And we are definitely working with the authorities to minimize risk, but it's really a big risk to shipping what is going on
right now. And it has to be stopped.
QUEST: But there is even when the fleet goes in, I mean, the Americans have sent a ship, now the Iranians have decided to send. But even when the --
it's is impossible to protect those vessels, isn't it .
LARSEN: It's .
QUEST: . against drone attack?
LARSEN: Yes, it can be very hard. I mean, you definitely need to have naval ships on the spot doing it. And whether you can do it 100%, I cannot tell,
but there's no doubt that it's a risk area right now, yes.
QUEST: And the alternative via the Cape .
LARSEN: Yes.
QUEST: . I mean, that .
LARSEN: That will add a few weeks.
QUEST: Is that -- forgive the ignorance here .
LARSEN: Yes.
QUEST: . because I said last night on the program, all right, so it adds a few weeks .
LARSEN: Yes.
QUEST: . but at least you know it's -- the ship is going to get there.
[15:05:03]
LARSEN: Yes.
QUEST: And it's -- is it that big a significance to go via the Cape versus through the canal?
LARSEN: It's a big -- it's a really big significance to world trade. It would add a lot of cost. It would take out a lot of capacity in the market.
So people would get their goods much later and at a much higher cost. So that would be the consequence, put it this way.
And you would have -- as you had during COVID, the cost of transport would go through the roof.
QUEST: Do you see an easy -- actually or a workable and a simple solution for reestablishing safety up through the Red Sea and through the canal?
LARSEN: I think the only measures you can do, apart from finding political solutions, would be to have armed escorts, military ships that would escort
civilian ships, sort of commercial cargo vessels going there. But I think it's a very .
QUEST: And even then it will be a question of whether not any company would want to risk it.
LARSEN: Yes. And that is again up to the company. And you saw Maersk, they're now put a 48-hour ban on sailing there. What they will decide to
do, I don't know. But, of course, it depends on how it just escalates.
(END VIDEOTAPE)
QUEST: Bjorn is also the chief executive of Norse Atlantic. And later in the program, you're going to hear about that part of his work and Norse
Atlantic flying across from Europe.
The US Navy commander in the Red Sea region says there are no signs of these attacks stopping. Today's attack was from an unmanned surface vessel,
which traveled from Yemen. It's the first time the Houthis have used such a weapon. They believe they're being supplied by Iran. United States says
that 55 different nations have direct connections to the ships that have been attacked.
Natasha Bertrand joins me now. The difficulty, we were just -- you just heard there the CEO of the shipping management company. I mean, I
understand you can never guarantee 100%, but it's proving to be very difficult for the US to know what to do here.
NATASHA BERTRAND, CNN NATIONAL SECURITY REPORTER: And they've tried setting up this maritime coalition with about 22 different countries to try to
bolster security in the area. And there are now five different warships from different countries that are operating in the Red Sea to try to serve
as a deterrent. But clearly, it hasn't worked. I mean, the US issued a very strong statement yesterday with a bunch of other countries, 12 other
countries, basically, a strongly worded statement saying that there are going to be consequences if the Houthis continue doing this and warning
them against further attacks.
But as we saw just this morning, the Houthis clearly not listening because they launched this attack with an unmanned surface vessel, which is
basically like a suicide drone -- suicide attack. They basically sent this vessel in to international shipping lanes and it detonated, and according
to the US military did not hurt anybody.
But, clearly, you know, these attacks do have the possibility of doing significant damage. And the missile strikes they have launched to date
have, in fact, hit some of these commercial vessels. So it's a really big problem.
QUEST: So do they have a Plan B and Plan C other than to tell shipping, no, you got to go the long way around.
BERTRAND: Well, we're told that the US is weighing a number of options to strike at the Houthis, including potentially striking them directly inside
Yemen, but that is not something US is particularly eager to do, because the US helped broker a truce between Saudi Arabia and the Houthis inside
Yemen, something that the Biden administration thought was a very significant kind of crowning foreign policy achievement.
And so, they are not actively working to try to reignite hostilities inside Yemen. And so, the options were now extremely limited, short of, of course,
attacking Iranian targets which, the US, of course, does not want to do either, short of escalating and igniting a full-blown regional conflict --
Richard.
QUEST: And that's the problem we saw, of course, with the bomb in Iran. We're now -- and ISIS now claiming responsibility for that. You know,
whichever way the US, and certainly the Pentagon, looks in the region, the potential for this thing to get out of hand, I mean, the US has got its
military assets there and will use them and doesn't want to.
BERTRAND: They don't want to. I mean, they are there and they're sending the message that if they do choose to do it, then they can do it very
quickly, and they can do it very meaningfully, right? And so, that is the kind of deterrent message they are sending.
And they will argue that it has worked to some extent because, for example, Hezbollah has not joined the conflict in force. Iran has not launched a
full-scale attack itself. They are simply launching these attacks through the various proxy groups throughout the region.
So the US says that, by and large, they believe it's working. However, these proxy groups, as we've seen, can do a lot .
QUEST: Right.
BERTRAND: . of damage. And so, the question is, how do you get to them? And that is something that they're grappling with right now.
QUEST: Natasha, I'm grateful. Thank you. Straight to Nic Robertson who is in Tel Aviv.
[15:10:01]
These two incidents, the bomb in Iran, along with the attack in Lebanon, and the Houthis -- or three incidents -- this is proving to be really
difficult.
NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes. You can add to that as well the killing of a senior Iranian commander in Damascus by an
airstrike that wasn't claimed by Israel but has certainly all the characteristics of an Israeli strike. And, of course, the US deciding today
to kill an Iranian-backed Iraqi militia leader because he had US blood on his hands.
Yes, I think the calculation here is very much, as Natasha outlined it there, that these attacks against Hamas targets, against other targets are
seen as below the threshold of what Hezbollah or Iran would respond to because the price they pay would be too high. Of course, there's always in
a heightened situation like this where so many red buttons, if you will .
QUEST: Right.
ROBERTSON: . are being pushed, that miscalculations can be made.
QUEST: Nic, how equipped is Israel to fight on multiple fronts as long as this sort of Hezbollah remains guerrilla in a -- to a certain extent? But
if it was to turn into full-scale warfare on the northern border, is there the capability?
ROBERTSON: Israel says it has the capability not only to fight on that northern front, but also be able to contain a high-level of unrest on the
West Bank and continue to do what it's doing in Gaza, plus working with the United States, the UK, and other allies -- even regional allies in the Arab
World, such as Saudi Arabia in terms of the Houthi attacks on Israel or attempted attacks on Israel. The -- Saudi Arabia have been helping there.
Egypt, part of that support. Jordan, part of that support, as well.
So Israel does believe it is capable of fighting on all those fronts. But, of course, the more of its military forces it draws into that fight .
QUEST: Right.
ROBERTSON: . that includes the reservists.
And as we have seen, they like to release the reservists to get back into the economy, which is not being too badly hurt at the moment, but it's not
without impact. So it would be a big stretch, but they believe they could do it.
QUEST: And finally, I just want to turn to what our leaders tonight, of course, while this idea of the shipping routes, you can see the screen
shows the difference of about 30 days. And the blue is going via the Suez Canal. The red is going the long way round.
The ability of the military to provide safe access through the Red Sea, the impossibility -- you are listening earlier. You heard the chairman of the
company saying, look, it can't be done and we're not going to send ships. This has got an economic implication, too, not that we count dollars before
bodies, but this does have a major economic impact.
ROBERTSON: Well, it does. I mean, ships then will have to be rerouted and they'll have to go a much longer and more costly in terms of fuel and,
therefore, delivery of products impact at the other end of the journey.
I was speaking with an Israeli expert today. He was, in fact, the former head of the Israeli military intelligence inside the IDF. He himself was
responsible for -- back in the 80's from his F-16 dropping a bomb on Iraq at that time -- nuclear reactor -- and responsible, as well, for coming up
with the program -- the military program to remove the nuclear reactor in Syria back in 2007.
This is a man steeped in the security of Israel. And I was asking him about the Red Sea. And specifically, that Iran had sent a destroyer there. And he
said it's not within the bounds of possibility that if Iran and the Houthis keep up what they're doing and the Houthis very much are sponsored and
emboldened and enabled by Iran, but if they continue to keep up their activities on commercial shipping then their -- then the cost will go up.
We heard David Cameron, the British foreign secretary, saying today that there will be costs. So it's not beyond the bounds of possibility that the
Iranians could find their destroyer being sunk. And I put it to him, well, would that then go above this threshold that the Iranians would be willing
to take before escalating? And the calculation is in the head of the leadership. And, quite possibly, depending on the circumstance, yes, the
loss of an Iranian destroyer there may well be something that might happen .
[15:15:03]
QUEST: Right.
ROBERTSON: . and might still not cause Iran to escalate further. Hard to imagine, but not impossible.
QUEST: Nic Robertson, I'm grateful for you, sir. Thank you.
Now, the minutes from the last Fed meeting are out or were out yesterday. Now, it is all eyes on the ECB. New inflation numbers in Germany and France
have given them something to think about, in a moment.
(COMMERCIAL BREAK)
QUEST: Inflation is back on the rise in the EU's two largest economies. Germany and France both saw higher consumer prices last month, being --
because of energy costs. Inflation rates have been steadily falling since April, and now they will have to see if that trend holds when we get
numbers for the eurozone as a whole.
Anna Stewart is in London. Anna, if we know where this inflation is coming from, in a sense from energy, does that mitigate the effect? Because I
realize, obviously, the worry is it feeds into other things of the higher cost, generally. But will the ECB be more the concerned?
ANNA STEWART, CNN CORRESPONDENT: I don't think so. I think there was an expectation actually that you would see inflation going in the wrong
direction for December largely because a big economy like Germany -- well, in December 2022, there was a subsidy for households on energy, and that's
been removed. That was a one-off. Of course, it was going to dip on that.
In France, a rebate at the petrol pump has been removed. So again, that leads into it.
Services inflation in France up slightly, so maybe that is a concern. I think the ECB, no real change for them in terms of strategy. But looking at
their rate rises, what does it mean going forward?
It doesn't change their opinion. I would say it might change investors, though, because you can see there the rate has been at 4% for some time.
There has been an expectation priced into the market that there could be a rate cut as early as march. That certainly hasn't been what we've heard
from the ECB, quite hawkish tones. They perhaps will see a slight change there. But other than that, as expected.
QUEST: Carrefour and Pepsi, removing the -- removing Pepsi products, in some cases, because of higher prices. Well, I don't understand in this one
is, surely, that's up to the consumer if the consumer wants to pay for that amount, and they can see the prices going up. So what's Carrefour's stance
on this?
STEWART: Well, this is the latest salvo, really, and something of a French retail battle. And we've been covering it for a few months now. And France
is a slightly different case, in many ways, and the rest of Europe because it's a much more regulated sector than elsewhere in Europe.
[15:20:10]
But particularly with Carrefour, they have been very vocal. They had a shrinkflation campaign last year where they stuck inflation stickers onto
products that have gone up.
The French government only allows them to negotiate with sort of a bigger consumer goods giant once a year. They've actually brought that forward
from March this to January to try to lock in lower prices. So this is Carrefour saying we do not agree with this.
The French government have named and shamed PepsiCo, Unilever, Nestle in recent months .
QUEST: Right.
STEWART: . for increasing prices. So it's not a huge surprise.
But yes, I mean, for consumers, if they really want a Pepsi or a 7up or Lay's crisps, they can go to other retailers.
QUEST: Anna Stewart, thank you. Grateful. Happy New Year to you, by the way. Thank you.
STEWART: And to you.
QUEST: Chief executive of Norse Atlantic says this will be the year his airline finally makes real money. Norse was founded after Norwegian Air
abandoned all its long-haul, low-cost operations. And Norse hopes to succeed where so many others have failed.
Its direct flights to six US cities, and then in the hemispheric winter -- north and hemispheric winter -- to Jamaica, Barbados, and Bangkok. It
completely switches its operations. The idea is to undercut legacy transatlantic carriers.
So, for instance, return flight London to New York departing, say, in one month returning a week later, the cheapest is, as you can see, $562 Virgin,
BA is $529. They're all pricing so the GDS is very close to each other. But Norse is the only one of the majors that's under $500.
Bjorn Tore Larsen says he knows his industry is ripe with risk, yet this year can be a year of growth.
(BEGIN VIDEOTAPE)
LARSEN: Last year was our first year in full operation, and it's a lot of cost that goes into training, that goes into building the company, building
the network. So we didn't really anticipate to make money the first year in full operation. But my hope and belief is that we will make money in this
year, 2024.
QUEST: I mean, and all my questions are with the caveat of other circumstances, Middle East, you know, whatever, higher oil prices. But as
we sit at the moment, you're growing the airline as well. But the history of growing airlines fast, what you need to do to get size and scale, is
exactly the history of disaster.
LARSEN: Totally correct. So we are growing very, very slowly. So this year, we have a total of 15 aircraft in our fleet. But we have, last year,
operated 10 of them. This year we'll be adding another two, so up to 12, which is a, you know, a significant growth but a modest growth. And then
next year, we'll grow by another 20%.
This is manageable. And we have a good airline size or air or fleet size for our size of airline.
QUEST: And yet, the traditional view has always been one with a start-up. If you look at the low-cost carriers at the short hauls grow very fast
because if you don't grow very fast, you won't get the scale.
LARSEN: Yes, well, I think that is a somewhat misunderstood practice. So I think you have to be very careful managing your growth. If you don't fill
those aircraft with paying passengers and you make sure that your income is higher than your cost, it doesn't really matter that you grow.
So it's much more important you grow profitably and controlled. And when you grow fast, you also lose control and you add complexity. So I would
caution against growing very fast.
QUEST: Having studied and watched Norse Atlantic for the last 30 years in aviation, all it takes is all the other carriers not colluding, just as
part of a natural commercial reality. Their GDS is watching your prices. And within a second of your price, they will match.
But all it takes is for the other carriers to just offer a few extra seats. Let's take London, New York. You know, JetBlue, American, BA, Delta,
Virgin, United, all they have to do is just offer a few extra seats, and you lose money.
LARSEN: You're absolutely right that if there is too much capacity .
QUEST: Which there is.
LARSEN: Well, sometimes you could say that, sometimes it's not. But the good thing is that for the consumer, they'll get cheaper tickets. And we
are very competitive because we have lower cost than all our competitors.
And so, I would say that we are prepared for competition. We welcome competition. It makes us better. It makes -- it gives more opportunities
for the customers. But I don't think that we will be taken up because of price simply because we have a very good cost structure.
QUEST: People in the industry constantly talk of top of your demise. They constantly say it's not a question of if Norse goes under, but when Norse
goes under. You've heard this. You read this.
LARSEN: Yes.
QUEST: What do you -- you have a wry smile. What do you say to them?
[15:25:01]
LARSEN: Well, what I can say is that airline business, in general, is financially risky. I cannot think of hardly any airline that hasn't been
saved by a government at some point in time. I'm fully aware that it's a risky business. But the best people, I mean, in Europe, for example, you
have a very big low-cost airline that has been able not only to survive, but to excel because they have been so focused doing operationally and
commercially what they should do.
So I think we are -- if we can do the things we are saying we're going to do, we're going to do fine.
QUEST: Good point, good point. But you're talking obviously about Michael and Ryanair, and let's say Jo of Wizz Air, who are messianic about the cost
base.
LARSEN: We are not competing with them. We are competing with a lot of legacy carriers who have a lot of loyal passengers, by all means, but we
are appealing to a new group of passengers who we are .
QUEST: Who?
LARSEN: . enabling. For example, the young generation, Generation Z.
QUEST: But then you have to start adding costs -- internet on board. Even if you charge for it, $2 million or $3 million on the aircraft.
LARSEN: No, we don't have to do that. We're not going to do that because it's not a good investment. People don't really want to pay for it. That's
the case.
QUEST: No, you want it free?
LARSEN: Yes, and we don't give it free because we really want to give people the opportunity to travel at a great value, at a lower cost. But
then we don't add a lot a very, very expensive frills, which really the customers don't want to pay for. If they -- because they have to pay for it
one way or the other.
(END VIDEOTAPE)
QUEST: CEO of Norse. Coming up, the rising tension between Israel and Lebanon as (inaudible) is in Beirut (inaudible) a slain Hamas leader.
(COMMERCIAL BREAK)
[15:30:10]
(MUSIC PLAYING)
QUEST: Hello, I'm Richard Quest. We have more QUEST MEANS BUSINESS in just a moment.
Theft of Kia and Hyundai vehicle have soared by more than 1,000 percent simply because online thieves are showing tips on how to steal them.
And another batch of documents from the Jeffrey Epstein case could be made public in the coming hours. We will get to that just a moment. Only after I
update you with the news headlines because this is CNN and here, the news come first.
(MUSIC PLAYING)
QUEST (voice-over): Police say multiple people have been hurt during a school shooting in a small U.S. town of Perry, Iowa. Law enforcement says
that the person (INAUDIBLE). Students and teachers were returning from holiday break when someone opened fire. It is unclear just how many people
have been shot.
Terrifying moments in a Las Vegas courtroom. The judge was attacked after she denied a request for probation, was attacked by the defendant, who is
now on attempted battery charges. The defendant lunged behind the bench, tackling the judge to the. Ground
The courts say she and the marshal both suffered injuries.
A report by House Democrats say that China spent more than $5 million at properties owned by Donald Trump while he was U.S. president. It includes
spending by both the Chinese government and its state controlled entities.
The Democrats say the report raises questions about conflicts of interest. Trump says no U.S. president has been tougher on China than his father.
And new details in the leadup to the runway collision at Tokyo airport. Runway records show the runway warning lights had been out of service for
some days before a Coast Guard plane collided with a passenger jet. Those are the details of the amazing evacuation, Japan Airlines evacuated all 379
passengers within 18 minutes of the (INAUDIBLE).
(MUSIC PLAYING)
QUEST: Israel's defense minister says his country needs a new security reality along its border with Lebanon. The IDF claims to have struck
several targets today in southern Lebanon after identifying incoming launches.
Since then, mourners have been gathering in Beirut to bury Saleh al-Arouri, the senior Hamas leader killed in a suspected Israeli strike. Israel has
not claimed responsibility for Tuesday's blast near the Lebanese capital. Nada Bashir is with me from Beirut.
Many events, all of which have the potential to make matters a great deal worse.
NADA BASHIR, CNN CORRESPONDENT: Absolutely. There is certainly mounting concern that this could trigger an escalation more broadly in the region.
We have seen from the outset of the war that the mounting tensions between Israel and the Iran-backed Hezbollah group in Lebanon, along with the
evidence of the border.
That exchange of fire has been a near daily occurrence from the outset of the war. We heard yesterday from Iran's secretary general, warning that if
Israel wages war on Lebanon, that the response from Hezbollah will be, in his words, "limitless."
We also heard from the Lebanese government, its foreign minister speaking to CNN yesterday, saying that the government doesn't want to see a war
break out. They are trying to convince Hezbollah not to wage a war with Israel.
As you mentioned, the targeting of that senior Hamas leader on Tuesday in Beirut, in the heart of a Hezbollah stronghold, has certainly raised alarm
bells on what this could trigger.
We are expecting to hear once again from Hassan Nasrallah tomorrow indications that the focus of his speech will be more focused on Lebanon
tomorrow. Certainly, all eyes will be watching to see what he has to say then.
Today, we saw thousands gathering to pay their respects for al-Arouri who was carried in the procession before he was buried at the Martyrs cemetery
at the Shatila refugee camp, a place that is clearly very much in support of the Palestinian cause, the historic Palestinian refugee camp.
Of course Hamas has pointed the finger squarely at Israel for that strike on Tuesday. Hamas' political leader describing it as a cowardly
assassination. As we mentioned, Richard, there has been no outright claim of responsibility nor denial from Israeli officials.
A U.S. official has told CNN that the U.S. understands Israel was behind the. Strike
Prime Minister Benjamin Netanyahu had been clear from the start, Israel will target Hamas leaders wherever they are located, not just in Gaza, not
just in the occupied West Bank.
So he's certainly been a prime target for Israel from the outset of this war. Again, he was a senior Hamas leader, number two in the political
bureau. Someone who is considered a founder of the military wing.
Also someone who had close ties with officials in Iran and, crucially, close ties with officials of the Iran-backed group Hezbollah in Lebanon.
QUEST: Nada Bashir, thank you.
Still to come, thefts of Kia and Hyundai vehicles soar by more than 1,000 percent.
[15:35:00]
The cars maybe driving off illegally.
But what is driving the spike?
In a moment.
(MUSIC PLAYING)
(COMMERCIAL BREAK)
(MUSIC PLAYING)
QUEST: Theft of Kia and Hyundai vehicles soared over 1,000 percent over the last three years. You may wonder the reason. It is the massive increase
fueled by social media posts teaching people how to steal certain models.
According to (INAUDIBLE) Research Institute, sharing its findings based on car theft insurance claims for those models of cars. They found the older
makes from 2015 to '19 were more vulnerable as they lack basic theft prevention features.
Peter Valdes-Dapina joins me.
So is this now over?
I mean, are modern cars less or more likely?
PETER VALDES-DAPINA, CNN BUSINESS SENIOR WRITER: Modern cars are much less likely to get stolen. The main thing that these vehicles lacked, these were
all vehicles that had the old-fashioned ignition that you and I both grew up with.
You put a key in and you turn. It what they lacked was an electronic immobilizer, which is a computer chip that would be in the key and in the
car itself, to double check and make sure that that key really belonged to the car.
Not having that made it much easier to tear apart the ignition, just jam a metal object into it, like a USB cord, and turn it and get the car to
start. It was pretty easy to fool. Almost all new cars these days have electronics to prevent these kind of thefts.
Many of them have just a push button kind of ignition that relies entirely, almost entirely, on that kind of electronic thing. So much harder to steal
now.
QUEST: Right. So you would not expect these numbers for Hyundai and Kia to continue at these elevated levels for the more modern -- ?
(CROSSTALK)
VALDES-DAPINA: No, not for newer models. For that matter, both Hyundai and Kia are trying to now go back and retrofit some of these older cars with
software updates and hardware and things like that to try to stop this and make these older models harder to steal as well.
QUEST: Now it's interesting because my brother-in-law had his car stolen just before Christmas, a modern car. What's interesting about it is they
managed to locate it and find it. But because there was so much electronics and digitization, it sort of worked when they got it back. But the lights
were flashing, the dashboard didn't work properly.
[15:40:02]
It's almost as if one needs now, with a modern car, after it has been stolen, the thieves know how to steal it. But in doing so they completely
screw up the highly sophisticated electronics. It's like almost you need to do control-alt-delete.
VALDES-DAPINA: Exactly. Or something more than that. Take it in maybe and have someone who knows electronic parts, even replaced. You are right. Cars
maybe harder to steal. But when a really smart thief does steal it, there can be a lot more damage that needs to be undone, even when the car is
taken back.
QUEST: It could be more than just repairing the lock. I'm grateful for you, sir, as always. Thank you.
VALDES-DAPINA: Thank you.
QUEST: The old adage, one man's trash is another man's treasure, that becomes more true with each passing. Year
Secondhand closing sales are on the rise all around the world. thredUP expects to make $218 billion globally by 2026. Companies like Goodwill are
seeing a boost, reporting a 6.5 jump over last year. As of November, strong holiday sales were in line with the rest of the retail industry.
Steven Preston is the CEO of Goodwill Industries internationally. He joins me from Maryland.
This is very heartening, in a sense. More people are not only donating but buying.
STEVEN PRESTON, PRESIDENT AND CEO, GOODWILL INDUSTRIES INTERNATIONAL: Yes, in both cases. For us, it is especially important. As you know, we are a
nonprofit. Americans are extremely generous with their donations.
Every dollar we get from those donations or from revenues of those donations, stays in local communities where we can provide people with job
assistance, job training and ultimately place them into jobs. So for us it is very important to be able to continue to sustain our local missions.
QUEST: Do you find competition from people selling their own stuff online?
I have a very nice jacket or whatever. In the past, I would've given it to Goodwill. Now I think, well, I will put it on whatever and then sell it
myself.
PRESTON: We certainly are seeing competition from for profit companies. They are actually expanding the market in a lot of ways by setting up these
marketplaces. But we also find many people prefer to donate.
Number one, because the value of the donations do help people in their communities. People often forget the fact that when you donate goods to a
place like Goodwill, you can get a tax deduction. It is very convenient because typically you are dropping it by a donation center.
So there is actually economic value, as well as social value and convenience. So I think when people put this all together, we are a pretty
compelling solution. But we do see a lot of for-profit competitors, many of those consignment opportunities.
Actually I think it is good for the whole industry because, increasingly, people are looking at used clothing as an attractive choice.
QUEST: That is the fascinating part. In the old days -- old, listen to me -- thrift stores, secondhand, even the word "secondhand," "used," those
were all pejoratives, as I'm sure you remember. That is not the case these days. It's almost like a sensibility, you know?
I come from Yorkshire; where there is malt, there is brass, we used to say. If something is in good nick at a thrift store, then good on you.
PRESTON: Absolutely. Absolutely. Well, there are a number of reasons. Number one, the categories actually called treasure hunting. People come to
our store because they know they are going to find value there. They look for that special something that is unique.
It's very much a part of the shopping experience. Secondly I think people are very socially minded. Goodwill keeps over 4 billion pounds of
merchandise out of the waste stream. So we are probably the largest driver of the reuse economy, in addition to the fact that we provide jobs services
with the money.
So there are a lot of things conspiring in a very positive way to drive this forward.
QUEST: We had an interesting discussion in our morning meeting when we were talking about this story, the for profit, the people who sell online -
- whether, as it has been suggested in the U.K., the income from selling online of secondhand clothes should be taxable.
If you think about it, if I get a tax deduction for giving it to you but I make private money by selling it online, there is an argument that says
one's tax, deductible in good, I should be taxed.
PRESTON: You know, I think the tax deduction for us is because we are a nonprofit. We are obviously for a social purpose.
[15:45:00]
That is very much, I think on the for-profit side, just like any other cooperation sourcing materials and selling them. They're going to get taxed
on the profit like any other corporation. I think that those are two very distinct features of the two organizations.
QUEST: Right. And, of course, it won't be long before people talk about taxing the sellers who sell online, I mean the actual people who donate the
clothes. Listen, that is another issue. Let's finish talking about what you would like to see more.
How would you like to see it grow?
What more can you do to evacuate the old and tired from my wardrobe?
PRESTON: First of all, we've noticed that you are a pretty natty dresser. So we do want to send someone to your house to pick up those gently used
clothes. Everything I wear is from Goodwill. A lot of times people do find some very nice items.
Sometimes the nicer things do sell for a bit more. If they sell for a bit more, that provides more benefit for people in your communities. The thing
that we want people to know is your gently used clothing or whatever can go for great value to people in your community. That is really the strong
message.
We often think of the fact that we have low unemployment. People don't often think of the need for job creation. But we have millions of people in
low paying jobs, 9 million unfilled positions.
If we can help those people get the training and the support that they need to be able to move into those higher paying jobs, we nominally benefit them
and their families but we benefit employers who are desperate for that talent.
They need to be competitive in this economy. So it really is a win-win for both sides. We try to be that bridge in the middle. Your donations are what
is enabling that to happen.
QUEST: I think we need to get a fashion designer to come with me to Goodwill and select a series of outfits that are suitable.
PRESTON: We are waiting for your call. We will make sure to do that.
QUEST: More documents from the Jeffrey Epstein case could soon be made public.
I beg your pardon, excuse me.
Hang on.
Thank you very much.
Just explain, I managed to drop my microphone.
And you know why?
Because it's an old jacket. You know what old jackets are like. They get very slippy. And this thing, look, it's going up and down like a seesaw.
We will be back in just a moment.
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[15:50:00]
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QUEST: A second batch of documents from a lawsuit connected to the Jeffrey Epstein case could be publicly released today. Of course, Epstein you are
familiar with; the multimillionaire accused of sex trafficking before his suicide in 2019.
Yesterday a U.S. judge unsealed hundreds of pages of documents, including depositions from some of his victims. Prince Andrew, Donald Trump, Bill
Clinton were all amongst the names mentioned.
It is very important to note that, mainly because you are included with the names as an associate, it does not indicate wrongdoing or illegal activity.
Much of the information revealed yesterday had been widely reported before. Shimon Prokupecz has our report.
(BEGIN VIDEOTAPE)
SHIMON PROKUPECZ, CNN SENIOR CRIME AND JUSTICE CORRESPONDENT (voice-over): Long awaited documents finally released. The first batch of sealed court
filings pertaining to the late sex offender Jeffrey Epstein were made public Wednesday. The document stemmed from a civil defamation lawsuit
brought in 2015 against Epstein's Former Girlfriend Ghislaine Maxwell.
Prominent figures including Prince Andrew and Former Presidents Bill Clinton and Donald Trump, included in a 2016 deposition of Johanna Sjoberg,
a former employee of Epstein. She says in the document that she and Epstein had a conversation and quote, he said one time that Clinton likes them
young, referring to girls.
When asked if Clinton was a friend of Epstein, she said she understood Epstein had quote, dealings with Clinton. Clinton has not been accused of
any crimes or wrongdoing related to Epstein and has denied any kind of criminal activity. But in 2019, he admits to having flown on Epstein's
private plane but knew nothing of the financiers quote, terrible crimes.
Sjoberg also recalled a time she was with Epstein on one of his planes and pilots said he needed to land in Atlantic City. Jeffrey said, great, we'll
call up Trump and we'll go to, I don't recall the name of the casino but we'll go to the casino. She says in the deposition, she never gave him a
massage to Trump. This is the first reference to Donald Trump but he is not accused of any wrongdoing.
LISA BRYANT, DIRECTOR, "JEFFREY EPSTEIN: FILTHY RICH": Right now the only person who has been prosecuted is a woman; Ghislaine Maxwell who certainly
you know should be behind bars. But it's interesting in this you know network of all these men who've been trafficking young women and underage
women for decades and yet the only person that's been prosecuted you know it's a woman. There are many, many other people that you know should be
held accountable as well.
PROKUPECZ (voice-over): The documents also contain excerpts of depositions taking a Virginia Roberts Giuffre, who previously reached an out of court
settlement in her sexual abuse lawsuit against Prince Andrew. Giuffre alleged in her deposition, that Maxwell directed her to have sexual contact
with people including former New Mexico governor Bill Richardson, Prince Andrew and tech guru Marvin Minsky.
Attorneys for Ghislaine Maxwell said in a statement on Wednesday, she has consistently and vehemently maintained her innocence. This is the first set
of documents to be unsealed under a December 18 court order, with more expected in the coming weeks. The documents are expected to include nearly
200 names including some of Epstein's accusers, prominent business people and politicians.
(END VIDEOTAPE) QUEST: Kara Scannell is again with me to go through. This
Kara, when I heard this this morning, as a former trained lawyer, I thought the prejudicial value of this is so great, throwing the names around in
such a way.
To what end?
What purpose does it serve to have all of these documents out there?
When authorities have not, as you told me yesterday, decided to go forward in many of those cases. Or there is no case to answer.
KARA SCANNELL, CNN CORRESPONDENT: The judge, in deciding to unseal all of these documents, did so at the request of the "Miami Herald," which had
been covering Jeffrey Epstein's world for years.
They wanted to have these documents unsealed in part to try to see what else there was to learn about Jeffrey Epstein's world. What we get from
this lawsuit is it is around Virginia Roberts Giuffre, one of the accusers.
It's certainly not the entirety of Jeffrey Epstein's sex trafficking operation.
So the judge, in making this determination, said so much of this information has already made public, either because people have given
interviews to the media or it had come out at the criminal trial of Ghislaine Maxwell, that the right to the public access to this outweighs
the privacy concerns. In a sense saying, this was already out there.
[15:55:02]
Everyone has known this information, if you've been following the story. It would not harm the people by having the information put out again.
Of course, for some of the accusers, it is something that some lawyers for the accusers have said, their concern is people need their story. But now
they get to read the deposition, which then is going into the graphic details of what happened to them.
QUEST: Kara, do we know when the next lot is about to drop?
Is it in the next couple of hours?
Do we know?
SCANNELL: We think so. The court order said they had to start posting these documents. They posted about 40 documents, 950 pages last night. We
understand it is going to be on a rolling basis. There are dozens of more documents to come.
We are waiting to see what time they're going to hit today. We will be going through them again. We will let you know what they have in them.
Richard.
QUEST: Grateful for that. Thank you very much. We will report what happens.
Later, let me remind you, tune in for back-to-back town halls and Republican presidential candidates Ron DeSantis in Nikki Haley. Join us
live from Des Moines, Iowa. It's at 9:00 Eastern time. You can work out what time it is where you. Are
Profitable Moment after the break.
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QUEST: Tonight's Profitable Moment. I'm a huge fan of Norse, mainly because anyone, any airline that manages to run routes and lower prices is
certainly worth investigating.
What Norse has done, Norwegian failed in the end, what Norse has done is take on one of the hardest routes in the world, the transatlantic. And
although they're not making money yet, there is a clear path to profitability.
It's really all about this idea of do the transatlantic usually use that fleet for the transatlantic in the Northern Hemispheric summer and then run
routes and charter out planes in the winter to Asia and the Caribbean.
It's a strategy that is working and it's arguably too soon to say that Norse is home and dry. Exogenous events, higher fuel prices, all sorts of
things could actually tip them over. But it is working. And that is to be applauded.
And every time you book a ticket across the Atlantic, which has some of the highest costs in the world and is also one of the most expensive and
competitive routes in the world, you've got to give thanks, that those like Bjorn at Norse came along and said, we can make this work.
That's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York. Whatever you're up to in the hours ahead, I hope it's profitable.
END
