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Quest Means Business
U.S. Stocks Plunge as Trump Threatens to Escalate Trade War; U.S. Distilled Spirits Council: We Want Toasts, Not Tariffs; Trump Administration Takes Aim at Environmental Regulations; U.S. Stocks Plunge as Trump Threatens to Escalate Trade War; Senate Committee Advances Bill to Regulate Stablecoins; Portugal Heads for new Elections After No Confidence Vote; Walmart Accused of Pressuring Suppliers in China to Cut Prices. Aired 4-5p ET
Aired March 13, 2025 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:10]
ERICA HILL, CNN HOST: Another miserable day on Wall Street, as you see there, the Dow shedding more than 530 points. The S&P 500 now in correction
territory. That is a lot of red for you. Those are the markets. These are the main events.
Donald Trump upping the ante in his trade war with. Europe, threatening 200 percent tariffs on alcohol imports.
Russian President Vladimir Putin, weighing in on the 30-day ceasefire with Ukraine, saying he has reservations.
And a former head of the EPA says the Trump administration's move to roll back environmental protections amounts to the worst day in the agency's
history. Gina McCarthy will join me.
Coming to you live from New York. It is Thursday, March 13th. I am Erica Hill, in today for Richard Quest. This is QUEST MEANS BUSINESS.
And it is good to have you with us. U.S. stocks are just plunging today as Donald Trump's trade war threatens to spiral out-of-control. The Dow down,
as you see here, 536 -- more than 536 points. The S&P falling into correction territory, down 10 percent from its record high last month. The
NASDAQ, as you see there, down around two percent on the day.
President trump is threatening to put now a 200 percent tariff on European alcohol unless the E.U. removes the tariff that it slapped on U.S. whiskey.
This whole for tit-for-tat of course, began when Mr. Trump put tariffs on metal imports and the President says he is not going to back down.
(BEGIN VIDEO CLIP)
DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: We've been ripped off for years, and we are not going to be ripped off anymore. No, I am not going to
bend at all, aluminum or steel or cars. We are not going to bend. We've been ripped off as a country for many, many years. We've been subjected to
costs that we shouldn't be subjected to.
(END VIDEO CLIP)
HILL: Anna Stewart joining me now from London.
Anna, when we spoke yesterday, you were talking about sometimes it is hard to remember where this started because of the constant back and forth, and
now, here we are again. This is really sending shockwaves today.
ANNA STEWART, CNN REPORTER: Yes, and you just have to look at the markets to see that because that has nothing to do with economic data in the U.S.
today. It has nothing to do with earnings. I think this is huge concern about where are all of these tariffs are going to go and who is actually
going to blink first. Because you heard from Mr. Trump there saying that he is not going to bend. We've heard from the French Trade Minister who took
to Twitter and said "We will not give in to threats and we will always protect our sectors."
So you have to wonder, will the E.U. now retaliate on these tariffs, which are absolutely huge. Important to remember though, Erica, these are
threatened tariffs and if the last few weeks have taught us anything at all, not all of Mr. Trump's threats of tariffs actually come to fruition.
HILL: It is an important point, although we can see that even when it is just a threat, there is certainly an impact.
STEWART: A huge impact, and not least actually for, of course, spirits makers, champagne makers. In Europe, we are seeing share prices actually
quite a lot lower. Pernod Ricard down four percent, Remy Cointreau down 4.6 percent today. This will have a huge impact and a bigger impact on some
E.U. member states than others.
For instance, France, of course, with champagne, is facing a huge issue here, 200 percent tariffs. The U.S. is its biggest export market. It sells
something like 27 million bottles to the United States every year.
Also, of course, a problem I would say, Erica, I don't know if you like champagne, but will you be willing to spend a lot more, potentially up to
three times as much for it? And I actually really enjoyed the part in the Truth Social post from the President where he said, "This will be great for
the wine and champagne businesses in the U.S." You can't make champagne in the U.S. You can make sparkling wine, but you can't make champagne.
HILL: It is a very important distinction, as we know, of course, champagne only comes from Champagne, from the region. It is -- I have to say, it is
staggering. I was talking about this with a colleague earlier. We both. I mean -- look, I like some champagne. I love Italian wine. The reality of
what that could do too for so many small businesses on either side. But when you're thinking about what those numbers could mean, whether it is
just simply cost prohibitive at that point.
STEWART: And who is actually going to win in this example. It is hard to see any victors here. It is going to be hugely costly for obviously the
importers, for these spirits, for the hospitality industry in the U.S. The U.S. is not going to instantly make enough volume of sparkling wine. And
frankly, in a free market, consumers might not want it. They may want champagne.
It is very hard to see winners here. The fact that the threatened tariff is 200 percent, which is huge, Europe's retaliatory tariff in terms of sort of
bourbon whiskey and other spirits in the U.S. was only 50 percent. You can only hope that this is just that, it is a threat. It is part of the
negotiation, and Mr. Trump last night in the bilateral with the Irish Taoiseach, did say that he thought negotiating with Europe wouldn't be
tough.
He compared it to that with the sort of talks with the Ontario Premier, and felt like they'd roll over. I am not so sure.
[16:05:07]
HILL: It does not appear that that is perhaps what is going to happen in 2025, but it certainly keeps us busy.
Anna, good to see you. Thank you.
Well, distillers and winemakers on both sides of the Atlantic are calling for an end to this trade war. The Belgian based trade group, Spirits Europe
noted the industry has yet again become collateral damage in an unrelated trade war.
Well, the CEO of the Distilled Spirits Council of the U.S. noting bluntly, "We want toasts, not tariffs." That CEO is Chris Swonger, who joins me now
along with Pauline Bastidon, who is the Trade and Economic Affairs Director at spiritsEurope.
It is good to have both of you with us this hour.
Chris, when we look at this, President Trump also posted on social media, as I was just talking about with my colleague, Anna Stewart, that this was
going to be great, in his view, for the spirit and the wine business in the United States. Is it?
CHRIS SWONGER, CEO, DISTILLED SPIRITS COUNCIL OF THE U.S.: Look, our industry collectively between the E.U. and the U.S. has thrived when there
has been zero for zero tariffs and great for the American economy and the E.U. economy as well.
Unfortunately, in the first Trump presidency, our friends in Europe broke a 20-plus year agreement for zero for zero tariffs with a 25 percent tariff
on American whiskey and in our industry, the American whiskey industry lost 20 percent exports.
We do believe there is an opportunity with President Trump and his leadership working with the E.U. to get this resolved. What is really
important is there is no light between the U.S. distilled spirits industry and the E.U. distilled spirits industry. We are intertwined, we have
distinctive products and we want to make sure in support of President Trump's efforts to thrive the American economy, in support of the
agriculture community here in the U.S. and bars and restaurants and taverns that we need the E.U. and President Trump to come together and get us back
to zero for zero tariffs, because we are the model for fair and reciprocal trade between these two great trading partners.
HILL: Pauline, how confident are you that that could happen? As you pointed out, you are yet again collateral in an unrelated trade dispute because of
course, this started with steel and aluminum.
PAULINE BASTIDON, TRADE AND ECONOMIC AFFAIRS DIRECTOR, SPIRITSEUROPE: Yes. We are once again collateral damage in yet another unrelated trade dispute,
which is something we can only regret, frankly and we are deeply concerned, deeply concerned by the escalation and by the prospect of tariffs on both
sides.
As my colleague from DISCUS mentioned, I mean, we are exactly of the same view when it comes to how we how we perceive the future of trade between
the E.U. and the U.S. in spirits. We do not want to see any tariffs, neither on E.U. nor on U.S. spirits, because, you know, at the end of the
day, you have E.U. companies that are heavily invested in the U.S. that produce bourbon, that produce American whiskey, and other types of U.S.
spirits; and you have American companies that are heavily invested in Europe that support lots of jobs there through production of great spirits
as well in many member states.
So we've thrived, you know, for so many years, thanks to the zero for zero tariff agreement. Tariff free trade has been really good for us. And we
really, really want to go back to that. We do not want to be involved any longer in this tit-for-tat trade war, which is frankly the worst thing, you
know for any of us. So let's go back to a time when we can cooperate more, when we can work together more for the benefit of our two industries and
all the jobs we support in rural communities and in the hospitality sector.
HILL: Chris, when you look at this, obviously for some of these U.S. businesses, compounding issues, right, with what we've seen in terms of
American spirits being taken off the shelves in Canada, boycotts as well there.
U.S. auto industry CEOs seem to have had a little success in their conversations with President Trump. Do you believe there is a similar
opportunity for the heads of some of these different alcohol companies to get in his ear?
SWONGER: Absolutely. There is a grand deal in the making that would certainly benefit the U.S. economy and support the Canadian and the Mexican
economy as well, and the European economy as well, and it is getting back to fair and reciprocal trade, which the industry has enjoyed for so long,
except for that three-year period when unfortunately, a tariff was applied on American whiskey. And just two days ago, unfortunately, in response to
the steel and aluminum debate, the E.U. proposed a 50 percent tariff on American whiskey.
So we are doing all we can to work with the Trump administration, and Pauline and spiritsEUROPE is doing all they can together to work with the
E.U. to find some common ground.
[16:10:07]
HILL: Pauline, you were sort of talking about the ripple effect here of all the various businesses that could be impacted. We also know that the
outlook is challenging for spirits and for wine in this moment. You know, I am thinking back to not just a few weeks ago, the earnings report from
Diageo. We have significant climate challenges, which are only building every year.
You had, I believe it was a drop for French wines specifically, it was already down. Exports were already down in 2024 because of economic
concerns, because of concerns about tariffs.
So given that almost a third, right -- the U.S. accounts were almost a third of the E.U.'s exports of wine and spirits. How do you prepare in this
moment, even if this is just a threat, you can't ignore it.
BASTIDON: No, and we are not ignoring it. We take this very seriously and that's why, frankly, we are so concerned. That's why we are sending this
message to both sides that look, enough is enough. Now there is, as my colleague said, an opportunity to sit together and find a solution.
I mean, we both want it. There is absolutely no division. We are fully united, you know, E.U. and U.S. producers, we want exactly the same thing.
We want to go back to tariff free trade.
There is no other option for us. There is no other option for our American colleagues. There is no other option for E.U. producers. This is the goal
and this is very much what we expect that politicians on both sides will deliver.
So I mean it is up to them now to make it happen. We are of course, more than ready to help. We've said that long before these announcements were
made, we see great potential, tremendous potential for further cooperation. We see great potential in the future for U.S. spirits in the E.U. and for
E.U. spirits in the U.S., and you know, it has been a difficult period for us, well, because of indeed an economic slowdown in many markets, we've
been suffering from barriers elsewhere in fact.
So, you know, let's work together. E.U. and U.S. on fighting these barriers where they exist and they are not in the E.U. and the U.S., they are
elsewhere, actually. So that's where the focus and the outlook should be at the moment.
HILL: We will be watching and following it all, of course, very closely. Pauline, Chris, appreciate you both joining us. Thank you.
SWONGER: Thank you.
HILL: While it was rather bleak on Wall Street today, there were a few winners, specifically U.S. utilities. Electric companies well outperformed
the market after the Trump administration launched a major rollback of environmental rules. The new head of the environmental protection agency
announcing 31 policy changes on Wednesday in a span of two hours.
That includes rules targeting pollution from power plants, coal and cars. EPA administrator, Lee Zeldin says the agency is shifting its focus.
(BEGIN VIDEO CLIP)
LEE ZELDIN, U.S. ENVIRONMENTAL PROTECTION AGENCY ADMINISTRATOR: Today, the green new scam ends as the EPA does its part to usher in the Golden Age of
American success.
Our actions will lower the cost of living by making it more affordable to purchase a car, heat your home, and operate a business. Jobs will be
created, especially in the U.S. auto industry, and our nation will become stronger for it.
(END VIDEO CLIP)
HILL: Gina McCarthy led the EPA during the Obama administration and blasted Zeldin's announcement as the most disastrous day in EPA history, noting
that rolling these rules back is not just a disgrace, it is a threat to all of us, going on to say, the agency has fully abdicated its mission to
protect Americans' health and well-being, and she joins me from Boston.
It is nice to have you back with me. How is this specifically abdicating the mission of the EPA?
GINA MCCARTHY, FORMER EPA ADMINISTRATOR: Well, It is not just abdicating it, it is changing it entirely. Look, EPA was created in 1970 by Richard
Nixon and ever since then, the mission of the agency has been to protect health, as well as the environment. Nothing in the announcements that were
made yesterday has any indication that EPA now is going to do that mission and do it well.
Look, it seems to be all about not protecting people and our health. It seems much more about protecting and opening up the opportunities for
fossil fuel companies to spew more and more and more pollution into our air and our water. That's what this looks like.
Thirty-one rules, some of which were around in 2009, are now being relooked at. That is just a euphemism to say that they're going to stop implementing
them, and they're going to take years to reconsider what they mean. It is an absolute disgrace.
And the biggest threat I know to the health and safety and climate opportunities that we now have available with clean energy.
[16:15:07]
HILL: So you bring up such an important point in terms of how this could roll out, because this is not something that, yes, you can make these
announcements about 31 different rules and regulations, but it doesn't immediately stop the implementation, not with an announcement or with the
stroke of a pen, there is a process. That being said, things can be slowed down. You can look at things.
So I mean, what is the immediate impact in your view, given that?
MCCARTHY: I think he made it particularly clear that he is looking at reconsidering now, which means he is going to put an announcement out
saying we may have missed the boat on this one, so we will have to think about how we look at all of those rules and regulations that we've been
implementing.
And if the, you know, the ways in which this administration has been working continues to be true, that will simply mean that they stop
implementing existing regulations and do the best they can to drag out this reconsideration so that they can give their friends the benefit of the
opportunities that now will open up to actually spew more and more pollution and lower the cost to those companies, which frankly, most of
them have already absorbed, already have the technologies in place.
And so my hope is that they'll stand up and continue to use those technologies. But I don't have faith in that, and after all, EPA isn't a
faith-based organization. It is based on science and the mission of that agency.
HILL: Yes, and the science is important as we know, science and facts. As you point out, a lot of changes have been made in a number of different
industries.
I mean, he name checked the auto industry and there is always a lot said about the auto industry and emissions regulations. The reality is many of
these companies have changed the way their cars are made, the way their cars operate. This happened years ago to get in line with standards out of
California.
From a purely financial perspective, it wouldn't seem to make good business sense to all of a sudden, when a new administration comes in and wipes
everything out, have to change everything back to the way it was.
MCCARTHY: Well, that is the real, I think, challenge here. First of all, one of the rules they're reconsidering is regulations on automobiles. So
let's not forget that. And those regulations actually helped companies like Tesla to get their market established.
So this is the inconsistency here. I guess, it is the hobgoblin of small minds. So, it is inconsistent. But I think the point you're really making
fundamentally is this is an entire rethinking of the way in which EPA operates, and it is very dangerous to the American public, and that's what
makes me worried.
You know, I don't know what they are going to do to implement these changes as they're indicating, but I do know that the big challenge for EPA and for
all of us is that if we keep with every administration shifting to extremes like this, what does it mean for the certainty of people in the United
States who really want to understand the challenges they are facing and expect government to stand up and step up for their health and well-being,
and for our natural world that we rely on and the challenge of climate change today.
It puts it all up in in terms of a basket where it is tipped over and no one right now can figure out what this is going to mean in the short or the
long term, and it is not a pleasant thought.
HILL: Just based on what we've seen, right, with the Department of Education over the last few days, this push to fully dismantle it, do you
believe there will ultimately be a push to just do away with the EPA full stop?
MCCARTHY: I think this is basically the intent, it is to stop it in its tracks. And don't forget, they are dismantling all of the science advisory
boards. They're getting rid of all of our environmental justice and our DEI initiatives, which is so important to communities left behind.
So this is part of a basically of a new platform that they're trying to put in place, which really is about loosening regulatory constraints so that
their colleagues, that they're interested in advancing, mostly what I see is the fossil fuel companies are actually going to have an advantage in the
marketplace that they don't deserve and shouldn't have, because it is going to be at the expense of every one of us, and our economy overall.
HILL: Sorry to interrupt you there, always appreciate your time. Thank you.
MCCARTHY: You, too. Take care.
HILL: Coming up here, Donald Trump says the Russian response to a ceasefire proposal is promising, but incomplete after Vladimir Putin expressed
reservations.
(COMMERCIAL BREAK)
[16:22:37]
HILL: Donald Trump calling Russia's response to a 30-day ceasefire proposal promising. Speaking alongside NATO Secretary General Mark Rutte, President
Trump said he wants to reach a deal fast so that the fighting can stop in Ukraine, also said his envoy, Steve Witkoff is currently speaking with
Moscow. The President also calling this a humanitarian issue.
(BEGIN VIDEO CLIP)
TRUMP: We know where we are with Ukraine and we are getting good signals outside of Russia as to where we are with Russia, and hopefully they will
do the right thing. It is really humanity -- we are talking about humanity. We are not talking about the money.
(END VIDEO CLIP)
HILL: Jeff Zeleny joining me now from the White House.
What more did we get out of President Trump today?
Really, where does this stand -- Jeff?
JEFF ZELENY, CNN CHIEF NATIONAL AFFAIRS CORRESPONDENT: Well. Erica, it stands a lot in what Vladimir Putin decides for the next steps here. I
mean, President Trump really over the last month, when you think back how rapid this reset of relations has been, I mean, for three years, the U.S.
and Russia had virtually no relations at all after Russia invaded Ukraine.
Of course, it all started with a phone call early February, and now here we are, and Vladimir Putin is saying, you know, rejecting an immediate
ceasefire, saying he is open to a discussion for one. But now the U.S. is waiting a bit. And as Steve Witkoff, one of the President's close longtime
friends and presidential envoys is meeting in Moscow with Vladimir Putin to talk about what they can do to get toward a ceasefire.
But the President, I thought was very measured in his language today in the Oval Office, sitting alongside the Secretary General of NATO and saying it
would be a disappointment for the world if Putin would not go forward with a ceasefire.
But clearly, the ball is in Putin's court at this moment, and the question is, what concessions will both sides give? Will Ukraine give up some land?
Will the U.S. decide to perhaps not halt the weapons during a ceasefire? So very many questions here, but it seemed to me at least, President Trump was
being cautiously optimistic, but an emphasis on the cautious part -- Erica.
HILL: Yes, absolutely. Also, as you noted, that stood out to me as well today, definitely somewhat more subdued than we have seen in some of these
other meetings as of late.
ZELENY: Sure.
HILL: Jeff, appreciate it as always. Thank you.
ZELENY: You bet.
[16:25:03]
HILL: Vladimir Putin says, as we have just been talking about, he does have some reservations about the 30-day ceasefire proposal. While he praised the
U.S. idea, he said there are still many things to discuss before agreeing to a deal making those comments during a news conference with the
Belarusian President Alexander Lukashenko.
Here is Fred Pleitgen with more.
(BEGIN VIDEOTAPE)
FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice over): Just hours after visiting his generals near the frontlines in the Kursk
Region, Russian Leader Vladimir Putin, back in Moscow, pouring cold water on President Trump's initiative for an immediate ceasefire with Ukraine.
VLADIMIR PUTIN, RUSSIAN PRESIDENT (through translator): I would like to begin with words of gratitude to the U.S. President, Mr. Trump, for paying
so much attention to the settlement in Ukraine.
We agree with the proposals to end hostilities, but we proceed from the fact that this end should be such that it would lead to a long term peace
and eliminate the root causes of this crisis.
(UNIDENTIFIED MALE speaking in foreign language.)
PLEITGEN (voice over): In other words, the Russians want to hammer out a full peace deal before ending the fighting, even as the Trump
administration says the shooting should stop immediately.
The U.S. President had hoped Putin would fully endorse his proposal.
TRUMP: Now, we are going to see whether or not Russia is there, and if they're not, it will be a very disappointing moment for the world.
PLEITGEN (voice over): This, as Russian forces say, they've been making major gains in the Kursk Region, Ukraine's last small foothold on Russian
territory.
Putin's soldiers are now patrolling the streets in small towns leveled by the battles.
(UNIDENTIFIED MALE speaking in foreign language.)
PLEITGEN: "There was fierce fighting here," this soldier says. "Ukrainian troops brought in heavy equipment and shot at the building point blank. But
the buildings are strong, the walls are strong, so the defense held up."
Putin went on to say he has concerns that the Ukrainians will use the ceasefire to regroup and rearm if Moscow's troops take their foot off the
gas now.
PUTIN (through translator): So these 30 days will be used how? So that force mobilization continues in Ukraine? So that weapons are delivered
there? So that units undergo training? Or if nothing of such sort will happen, then the question arises, how will the issue of control and
verification be resolved? And how will we be guaranteed that nothing like this will happen?
PLEITGEN (voice over): While the Ukrainians have fully signed off on the ceasefire proposal and say they are willing to implement it immediately,
the Russians say they see little benefit in freezing the fighting, although Putin says he, too wants to see the war come to an end.
PUTIN (through translator): I think that we need to talk about this with our American colleagues, partners, maybe call President Trump and discuss
it with him. But the idea itself to end this conflict by peaceful means is supported by us.
PLEITGEN (voice over): Fred Pleitgen, CNN, Moscow.
(END VIDEOTAPE)
HILL: Coming up here, the Senate advances a bill to regulate stablecoins as the President throws his full support behind the crypto industry. Up next,
I am joined by the chief policy officer for Coinbase, after the break.
(COMMERCIAL BREAK)
[16:31:10]
HILL: Hello, I'm Erica Hill. There is more QUEST MEANS BUSINESS in just a moment when a new CNN poll shows Americans are growing a lot more
pessimistic about their economic futures, and Coinbase's chief policy officer will join me to discuss a Senate vote that he's describing as a
major breakthrough for crypto. Before that, though, the headlines this hour.
A judge in the U.S. is ordering the reinstatement of thousands of federal employees who were fired by Donald Trump and Elon Musk let go under the
Trump administration's attempt to shrink the size of the federal government. The order applies to six federal agencies, including the
Department of Veteran Affairs and Defense.
The White House withdrawing its pick to lead the Centers for Disease Control and Prevention. Doctor David Weldon has been criticized by health
experts for expressing its skepticism about vaccines. He said some Republican senators had decided against supporting his nomination.
Nearly 100 protesters at New York City's Trump Tower arrested after demanding the release of a detained Palestinian activist. The group Jewish
Voices for Peace, organizing that protest in support of Mahmoud Khalil. Khalil helped to lead protests at Columbia University and was arrested, of
course, by immigration officials. He is currently still being held in Louisiana. No word on exact charges.
The S&P 500 entering a correction as Donald Trump threatens to escalate his trade war. The Dow dropped more than 530 points today. The S&P down 77.
That's down more than 10 percent from its record high last month. As for the Nasdaq, it was off 1.5 percent.
Americans are increasingly concerned about the state of the economy. According to a new CNN poll, 51 percent believe the economy will actually
be in poor shape a year from now. That is up seven points from the feeling in January.
Vanessa Yurkevich joining me now here in New York.
So these numbers reflect certainly a lot of what has been said anecdotally. How concerning are they?
VANESSA YURKEVICH, CNN BUSINESS AND POLITICS CORRESPONDENT: Yes. And it's not only what's being said right now. It's a reversal from what we saw in
January. If you look at the poll, so 51 percent of Americans believe that a year from now the economy will be in poor shape. That's a reversal from
January, which showed that 44 percent of Americans thought the economy would be in poor shape.
So really, in just one month's time, Americans shifting their perspective about the economy. A lot of this is because of Trump's tariff policies.
People are confused. They're feeling uncertainty. And when asked in this poll whether or not Trump's economic policies were having an impact on
their thoughts about the economy and how the economy was doing, 51 percent said that conditions were worsened by his policies, 28 percent saying that
he was improving it and 21 percent saying that they didn't feel like it was affected just yet.
But as I mentioned, really the tariff conversation and the global trade war that is playing out just in the last 48 hours really illustrates the
whiplash that so many Americans are seeing and that investors on Wall Street are seeing right now. In the last 48 hours, President Trump slapped
a 25 percent tariff on steel and aluminum imports. In response, the E.U. responded with a tariff on American whiskey.
Then President Trump threatened a 200 percent tariff on French wines and champagne, and the E.U. said that they are getting ready to retaliate to
that tariff. So you can just see the spiral of tariffs that are going on right now. And at its core, the president says that he is very -- he loves
tariffs, as he says, because he wants manufacturing and companies to be right here in the United States producing products and he wants consumers
to buy American products.
[16:35:05]
The problem with that, Erica, is that across so many industries, the auto industry, the lumber industry, the wine industry, the U.S. does not have
that capacity. For example, we get a lot of what's called soft lumber from Canada. That is used to build homes right here in America. 30 percent of
that lumber comes from Canada used to build homes, and there's already a housing shortage here in this country.
And that just on the wine and champagne front, Napa Valley cannot all of a sudden start producing enough to meet demand here in the U.S. if Americans
decide not to buy from Italy and France because of those higher prices.
So, Erica, you can just see how this is so intertwined and how this is confusing for many Americans to try to figure out what our tariff policy
really is. We know there's a meeting happening today between the Commerce Secretary Howard Lutnick and the premier of Ontario, Doug Ford. I wonder if
there's going to be conversations around these tariffs. They say that they're going to be working on USMCA. That's that free trade agreement. But
you have to imagine tariffs are going to come up in this conversation.
And as you know, Erica, April 2nd, a whole new round of tariffs are set to kick in. But you see the Dow right there, and you see those markets across
the board, not liking what they're hearing. not liking this uncertainty around these tariff proposals -- Erica.
HILL: No, definitely not. Vanessa, appreciate it as always. Thank you.
YURKEVICH: Thanks.
HILL: Well, the Senate Banking Committee voting to advance a bill to regulate stablecoins earlier today. That bipartisan Genius Act, as it's
known, aims to provide more clarity, some stability in an industry that has been referred to by some as the Wild West. The momentum here also comes as
Donald Trump has, of course, thrown very vocally his support behind the crypto community, hosting the first ever crypto summit at the White House
last week. He's also signed an executive order to establish a strategic crypto reserve.
Faryar Shirzad is the chief policy officer of Coinbase and joins me now.
Nice to have you with us this afternoon. So the crypto industry, as we know, is a major donor in the 2024 election cycle, as was Coinbase. You
called this bill earlier today the, quote, "dawn of a new era for the financial system." How so?
FARYAR SHIRZAD, CHIEF POLICY OFFICER, COINBASE: Well, thanks for having me on, Erica. You know, crypto is fundamentally an information technology
solution. It allows for people to move value. So whether it's a tokenized dollar or a bitcoin or whatever, it happens to be as easily as you move an
e-mail or a text. And so the potential for that to update the financial system across the board is enormous.
And the Senate took a hugely important step today at the Senate Banking Committee to vote 18 to 6 on a very strong bipartisan basis to pass
legislation to create a federal regulatory framework around stablecoins. So these are tokens that are representative of a dollar. Right now the annual
turnover around the world of stable dollar denominated stablecoins is on the order of $2 trillion to $3 trillion every year, $2 trillion to $3
trillion.
And so what the Senate did, the banking committee has taken an important step together with Democrats, to try to create a federal framework so that
these stablecoins are issued in the United States.
HILL: Senator Elizabeth Warren, who has said she's willing to work, right, to work on this bill, as you know, I'm sure, has raised a number of
concerns but specifically, she's pointing out her national security concerns, talking about Iran, North Korea, perhaps being able to use dollar
backed stablecoins to then get around restrictions when it comes to buying dollars, U.S. currency.
Do you believe there should be a little bit more regulation there when it comes to foreign buyers to address those concerns?
SHIRZAD: Well, what we need first and foremost is to create a framework so that these dollar stablecoins are issued in the United States. And that's
what the Senate did today. And so it's, you know, they're really important contributions Democrats and Republicans made to get the bill in a better
shape. I know there's going to be ongoing work even after the committee has acted. The House is going to do the same.
But in the end of the day, this bill is an extraordinary step towards consumer protection, AML protections, anti-illicit finance use cases. So
it's a really good news story. And it was great to see it move forward the way it did.
HILL: So to your point as things are moving forward and there will be obviously much more done in terms of the bill, do you believe, though,
specifically there should -- that language should be in there to deal with some of these national security concerns?
SHIRZAD: Oh, it's in there already. I think that was one of the things that the authors of the bill include, especially Senator Hagerty, put in,
Senator Warner and a number of other Democrats asked for changes to augment those provisions. They were added. So there was a significant amount of
work done in that regard. I don't know if additional measures are necessary because of how comprehensive the coverage of those protections already is
in the legislation. But I know the committee will look at whether there are anything more that needs to be done.
HILL: When it comes to -- there have been concerns raised, I'm sure you've seen them, about potential conflicts of interest, even the appearance of
conflicts of interest. President Trump is a big proponent of crypto, as we saw. He proposes I noted the strategic reserve that would include lesser
known tokens, meme coins, like those that he and the first lady launched around the inauguration. Does that give you pause?
[16:40:08]
SHIRZAD: Well, what it tells me is it's just like the internet. There are so many different use cases and applications. All of us touch the internet
in a different ways. The real focus should be from a policy and Washington perspective is, are we addressing the areas where we need federal
regulation? And I think the Senate is doing that by passing through the committee the stablecoin bill. The House is going to act next week and to
do the same thing.
We need legislation around creating a federal framework around market structure. So the role of the CFTC and the SEC in regulating it, and I
think that will be a gigantic step towards addressing any concerns people have about market integrity, conflicts of interest and anything like that.
So the work necessary to address those issues is already underway. And that's really gratifying.
HILL: In terms of market integrity, do you have any concerns about some of these lesser known tokens, meme coins, that they could in any way devalue
or delegitimize more established cryptocurrencies like those that your customers buy and sell?
SHIRZAD: Well, like I said, it's a lot like talking about the internet and saying that there may be a Web site that one of us may not like or what
have you. I think in the end of the day, this technology is so broad and its application so pervasive, you could sort of lose your focus and talk
about individual applications. I don't have any particular concerns as much as I do. A very strong focus on doing what Congress and the president
should do, which is pass the legislation.
We need to create federal rules, protect consumers, and make sure that America leads in this sector, just like the president said he wants to have
happen.
HILL: Faryar Shirzad, appreciate your time this afternoon. Thank you.
SHIRZAD: Thank you, Erica.
HILL: Portugal's government has been toppled after a no-confidence vote. The president just calling for early elections. This would be the country's
third vote in as many years. Just ahead, a closer look at the political troubles in Portugal.
(COMMERCIAL BREAK)
[16:45:04]
HILL: In the 19th and early 20th centuries, commercial whaling practices devastated whale populations worldwide. The number of humpback whales, for
instance, were reduced by an estimated 95 percent at one point. An international ban on whaling in 1985, though, has helped the humpback
population to rebound. It now numbers more than 80,000 worldwide.
Today on "Call to Earth," we visit Cape Town for a firsthand look at the measures that have been taken to help the species recover.
(BEGIN VIDEOTAPE)
ZAIN ASHER, CNN ANCHOR (voice-over): A light fog hangs over South Africa's scenic Cape Peninsula on an early morning in December. For renowned
photographer Chris Fallows and his wife and co-captain Monique, it's a picture perfect start to the day.
CHRIS FALLOWS, PHOTOGRAPHER AND CONSERVATIONIST: So we're trying to create exceptional images and this morning we're very lucky we've got a beautiful
scene developing with tablecloth rolling over Table Mountain. First rays of light are just starting to kiss that iconic landmark, and it's looking
pretty good. Just need to find the whales now.
ASHER: They're searching specifically for the playful and acrobatic humpback.
FALLOWS: Well, that's a young humpback whale. That's a species we're looking for.
ASHER: But its more than one or two they're hoping to find.
FALLOWS: So early in the morning, we usually find ones and twos that then lead us to either a feeding area or are part of a structure that actually
comes together and forms a super group.
ASHER: A so-called super group is when at least 20 individuals, often many more, are feeding close to each other.
FALLOWS: So these super groups of whales have really only been around for probably the last 10 years or so. Before that, they were extremely
difficult to find, and in recent times, as their population has started to recover, so we've ever increasingly started seeing big, big groups of these
whales, which has been truly incredible. It's one of the great positive news stories on the ocean.
Let's listen to those sounds. It's such an incredible sensory experience.
ASHER: Though the population has rebounded from the days of commercial whaling, new dangers have emerged. Climate change, entanglement in fishing
gear, and ship strikes are now some of their biggest threats.
FALLOWS: Come on, whale, fluke. Beautiful. Beautiful. Beautiful, beautiful.
ASHER: South Africa has laws in place that prohibit people and vessels getting any closer than 300 meters to a whale without the proper permits.
MONIQUE FALLOWS, AUTHOR AND NATURALIST: Here comes the fluke.
ASHER: But Chris and Monique have both the permits and decades of experience that allows them to get this close.
FALLOWS: Slowly on this side next to us. Slow down a whisker. Go neutral.
M. FALLOWS: I would say maybe 70 percent of my attention is making sure that I'm not going to impact an animal in any way in terms of where the
boat is. So I'm extremely aware that is the number one focus when we are out there.
FALLOWS: Oh, magic, man. Oh, what a magic one.
Obviously one of my key objectives is to create works of art that are amongst the best in the world. But equally, I think my primary objective is
to inspire people, and I think that is a way to connect people with the ocean and hopefully create more ambassadors to make sure that they, like
me, love these animals and realize the importance of conserving them.
Oh, that's it. Whoa, that was a good one. That was a really good one.
ASHER: Their days on the water are also dedicated to collecting data to share with environmental authorities, like the Department of Forest,
Fisheries and the Environment.
FALLOWS: So south 33 degrees.
ASHER: And capturing photo IDs of individual whales for a conservation project called Happy Whale that helps track their movements non-invasively.
M. FALLOWS: I'll go on the left side. You go on the right side. OK?
ASHER: Chris has spent the better part of three decades photographing some of the planet's most legendary and imperiled wildlife. But the comeback of
the humpbacks paints a different picture.
FALLOWS: They are incredibly important animals, and for me, the humpback is really the phoenix that gives all species that have turned to ashes hope
that they, too, could rise again.
(END VIDEOTAPE)
HILL: Let us know what you're doing to answer the call with the hashtag CalltoEarth.
(COMMERCIAL BREAK)
[16:52:11]
HILL: Portugal is headed for its third election in just over three years. A short while ago, the country's president dissolved parliament and called
for new elections. He had few options after the minority government lost a no confidence vote on Tuesday.
The outgoing prime minister, Luis Montenegro, is accused of having a conflict of interest over his family's consultancy firm. He has denied any
wrongdoing and says he fought as hard as he could.
(BEGIN VIDEO CLIP)
LUIS MONTENEGRO, PORTUGAL PRIME MINISTER (through translator): We tried at all costs right up until the last minute to avoid creating early elections
on the horizon for the Portuguese and for the life of the country.
(END VIDEO CLIP)
HILL: CNN Portugal anchor Joao Marinheiro is joining us from Lisbon now.
Good to have you with us. So walk us through not only what happened, but what's next at this point.
JOAO POVOA MARINHEIRO, ANCHOR, CNN PORTUGAL: So next it will be a quick campaign. In the next two months, we'll have elections on the 18th of May.
We just heard from the president. There was no other way for him to do anything but to call a snap election. It's the third time he's done it.
Constitutionally he's not really obliged to do it, but he was morally obliged to do it to keep his record coherent, especially after the way he
managed the last elections in 2023 following the resignation of then Prime Minister Antonio Costa, currently, the European Council president.
He had to dissolve the parliament and call elections despite the Socialists giving out names to fill the PM's office. And they were in a better
position than the center right, the current center right government, because they had an absolute majority. So the president back then, he
always refused such an outcome and he called elections. So this time to avoid political backlash from the opposition since he comes from the same
political family than the current center right government, he had to call these elections.
One important note from his address tonight, since this case revolves around the prime minister's behavior and anticipating what could be a very
nasty and personal campaign, he did appeal to all political forces to focus on what really matters to the Portuguese people in the next couple of
months.
HILL: Joao, really appreciate it. Thank you.
Well, here in the U.S., Walmart getting caught in the middle of that trade war between the U.S. and China. The retailer is accused of pressuring
suppliers for discounts in order to cope with the tariffs.
Hanako Montgomery has that story.
(BEGIN VIDEOTAPE)
HANAKO MONTGOMERY, CNN CORRESPONDENT: Walmart is the latest casualty in this U.S.-China trade war. Chinese officials summoned Walmart executives on
Tuesday investigating whether the retail giant pressured Chinese suppliers for discounts to offset rising U.S. tariffs.
[16:55:07]
Businesses worldwide are struggling with U.S. president Donald Trump's unpredictable tariff hikes, which have escalated trade tensions between the
world's two largest economies. Just last week, Trump doubled duties on all Chinese imports to 20 percent. In response, China slapped new tariffs on
U.S. agriculture effective since Monday.
Walmart with stores in more than 100 Chinese cities and a 16 percent net sales jump last year is now scrambling for solutions. Now, in a post on
social media, Chinese state media said that officials from the country's Commerce Ministry requested a meeting with Walmart executives to, quote,
"understand the situation." The social media post also said, quote, "If true, Walmart's demands for Chinese suppliers to bear the full tariff
burden is unreasonable and disrupts fair competition and international trade order."
Now, in a statement to CNN, Walmart said its purpose was to help people, quote, "save money and live better." But clearly, in this brewing trade
war, even giants like Walmart are feeling the squeeze.
Hanako Montgomery, CNN, Tokyo.
(END VIDEOTAPE)
HILL: Just ahead, a rough day on Wall Street. We'll take a look at the final numbers. Stay with us.
(COMMERCIAL BREAK)
HILL: Let's get you a quick recap of the markets before we leave you on this Thursday.
Wall Street falling sharply as Donald Trump ramped up those threats of tariffs. The major indices, as you can see, all closing more than 1 percent
lower on the day. The S&P 500 fell into correction territory, down 10 percent from its most recent peak last month. The Nasdaq, of course, has
been in correction since last week. You can see it was down actually nearly 2 percent.
Today's sell-off following that threat by President Trump of a 200 percent tariff on European alcohol in retaliation for a tariff on U.S. whiskey. Of
course, it all started with steel and aluminum.
Let's take a look specifically at some of the Dow components here. The tech giants actually among the worst hit of the day. Apple, Salesforce, Amazon
all near the bottom. Apple is now down 20 percent from its all-time high in December. Boeing, though, closing up after Citi said shares in the plane
maker are undervalued.
U.S. utilities among the few winners today on Wall Street. Electric companies really outperformed the market after the Trump administration
launched or announced a major rollback of environmental rules.
That is going to do it for QUEST MEANS BUSINESS on this Thursday. I'm Erica Hill. Thanks for joining me. Stay tuned to "THE LEAD WITH JAKE TAPPER"
starts right now.
END
