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Quest Means Business

Trump In Japan; U.S. And China Reach Framework Deal; Delta CEO: Riyadh Expansion Is Amazing Opportunity For The U.S.; Argentine Peso Jumps After Milei Midterm Victory; Hurricane Melissa Heads Toward Jamaica As Category 5 Storm; U.S. Looks To Boost Military Pressure On Venezuela; Two Suspects In Connection With Jewelry Theft; Insurers Boost Deductibles By Tweaking Small Print. Aired 4-5p ET

Aired October 27, 2025 - 16:00   ET

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

[16:00:17]

JIM SCIUTTO CNN HOST: There's the bell. U.S. markets closing at yet another record high as investors celebrate a potential trade breakthrough, at least

for now between the U.S. and China. Those are the markets and these are the main events; President Trump lands in Japan as his Treasury Secretary lays

out the terms of a framework deal with Beijing.

Argentina's President scores a big election victory with perhaps a little help from Washington.

And Delta CEO, Ed Bastian tells Richard Quest why he is launching the airline's first route between the U.S. and Saudi Arabia.

Live from Washington. It is Monday, October 27th. I am Jim Sciutto, in for Richard and this is QUEST MEANS BUSINESS.

Good evening.

Tonight, U.S. President Trump is set to meet with Japan's new Prime Minister after securing a framework trade deal with China. Trump visited

Emperor Naruhito shortly after landing Monday evening in Tokyo. He is on the second leg of his three-country tour of Asia, set to culminate in South

Korea, where regional leaders are gathering for the APEC Economic Summit.

Beijing says the framework shows it is possible to stabilize relations between the two countries -- stabilize -- notable language. It is not yet

confirmed a meeting between Trump and Chinese leader, Xi Jinping, however, U.S. Treasury Secretary Scott Bessent says the groundwork has been set.

(BEGIN VIDEO CLIP)

SCOTT BESSENT, U.S. TREASURY SECRETARY: We have a framework for President Trump and President Xi to decide on, and we discussed a wide range of

things from tariffs, trade, fentanyl, substantial purchase of U.S. agricultural products and rare earths.

DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES OF AMERICA: But nothing has been agreed to yet. We feel good. We're going to have a great talk. I

have a lot of respect for President Xi. I like him a lot. He likes me a lot, I believe and respects me, and I think he respects our country a lot

and we are going to have -- I think we are going to have a successful transaction.

(END VIDEO CLIP)

SCIUTTO: Bessent says that the President has effectively taken an additional hundred percent tariff on Chinese goods, which was set to kick

off next month off the table.

The framework addresses many of the issues that prompted Trump to make that threat. Bessent says China agreed to defer, not cancel its export controls

on rare earths and agreed to buy again substantial amounts of U.S. soybeans. He says a final deal also reached on the status of TikTok going

forward, and that both sides will cooperate on stemming the flow of fentanyl.

We are following this from both sides, Alayna Treene in Washington; Mike Valerio in Beijing.

Alayna Treene, when you hear Bessent and Trump speak, they describe this in effect as a major trade deal. All the problems are solved. When you look at

the fine print; however, this looks to be more of a truce than perhaps an end to the trade war.

ALAYNA TREENE, CNN WHITE HOUSE REPORTER: Yes, and that's exactly what we've seen, Jim, kind of every step of the way with the negotiations around this.

That is the key question. I mean, this meeting between President Donald Trump and Xi Jinping, while, as you mentioned, the Chinese have not yet

confirmed it, we know, at least I know from my conversations with people at The White House, it is very much going ahead on Thursday.

It is going to be very high stakes, though, and we have to actually see what the Chinese are willing to agree to, and I do think, you know, the

rhetoric we've heard from the President himself, obviously, the Treasury Secretary, Scott Bessent, from that clip you played other administration

officials, I mean, they are far more bullish, Jim, than we have heard the Chinese and their counterparts in China, really be on this.

I think they argue there is optimism for a deal, but it is not quite clear if they can get there. I think the framework, however, though, has given

particularly the Treasury Secretary. Also, you saw the U.S. Trade Representative, Jamieson Greer, he was on the plane standing beside Trump

as well, has given them, you know, more hope that they could make some real progress on this, but it is very much unclear if this is actually going to

be one of those more lasting trade deals that they have been working toward the entire past few months.

And so there are a lot of agreements that they need to work to, I know, Jim, from my conversations with people at The White House, the big

priorities for them, yes, fentanyl, stopping the flow of fentanyl into the United States. That is a huge one. But soybeans is more urgent, and this is

something the President has brought up repeatedly. He is getting a lot of pressure from farmers across the United States right now because China

essentially has stopped purchasing soybeans altogether.

[16:05:10]

So if they can get them to begin buying a substantial amount, as those are the Secretary's words there of soybeans, again, that would go a long way.

And one thing I just want to note as well, separate from this entire framework and on trade is another priority of President Donald Trump's,

Jim, which is he wants to try and persuade Xi to help bring Russia and specifically Russian President Vladimir Putin, back to the negotiating

table and a more substantial way on talks between Russia and Ukraine. That is also a very high priority for President Donald Trump.

So, again, it has the potential to be a very, very high stakes meeting, has the potential to have a lot of huge you know, agreements and consequences

for the U.S. but we will have to see if they can actually get there.

QUEST: Yes, no question. Alayna Treene, thanks so much.

So let's go to Beijing now. Mike Valerio, I wonder, is China portraying this as a major trade agreement?

MIKE VALERIO, CNN CORRESPONDENT: Well, I mean, there are very much more circumspect in their language and very much more careful with the details

as you know, from your time in this town here, Jim. So I don't think that they are characterizing it as such, as a major trade deal, because there is

still a lot of caution with this administration. But what they are doing, everybody who is a member of the political class in this town is portraying

this maneuver, and this is the latest chapter of the trade war with such confidence that Beijing really, for the first time in the past 20 years,

has been able to set the terms of this trade negotiation.

When you think about the early 2000s, China was not able to do this to potentially reset the rules of global trade on its terms and bring the

United States into, you know, these time consuming, strenuous negotiations, you know, so why this matters for all of our viewers around the world, with

so much going on between all corners of the globe is that we have essentially stepped back from the U.S. Treasury Secretary telling from

tariffs up to 157 percent on Chinese goods coming into the United States and on the flip side of the coin, we've also stepped back from China,

potentially cutting off the United States' access to these rare earth minerals that are critical for cars, laptops, cell phones fighter jets --

you name it as well.

So the stakes certainly incredibly high, but from the Chinese side, we are very limited on the details what we are going to have going into Thursday

and towards the end of the week. But Alayna is certainly right. What China wants here is a longer term deal. And, you know, you certainly mentioned it

at the top of the segment rather than just a short term truce that only lasts for a few months. China also wants freer access to these advanced

U.S. chips that it does not quite have its hands on, and it cannot quite make on its own. It can't match the technological prowess of these United

States' chips, specifically the ones made by NVIDIA.

And worth mentioning before we go here, over the past couple of days, myriad members of the Chinese Communist Party have congregated here in

Beijing to help assemble the next five-year plan that will guide China's economic and human capital, human resource efforts five years into the

future, into 2030. And the main goal of it is to match and exceed the United States' technical prowess when it comes to these advanced chips, so

that it is never in this predicament again, that it never has to negotiate with the United States with a weakness that it would see from its part in

needing the United States for these chips -- Jim.

SCIUTTO: Yes, and when they're making five-year plans, of course, they don't love the idea of, you know, two to three month backs and forths as to

the relationship with the U.S.'

Mike Valerio, thanks so much.

Global markets are celebrating the progress made by the U.S. and China. U.S. markets hit yet more record highs. The Dow trading well over 47,000.

The S&P jumped a little over one percent. Tech stocks once again rose sharply strong gains as well in Asia. The Hang Seng and Shanghai Composite

both rose more than one percent. Japan's Nikkei average surge more than two percent on Monday.

Gold, a traditional safe haven, that fell sharply, a sign investors are feeling less worried. Still, concerns remain, with Trump increasing tariffs

on its neighbor, Canada by 10 percent.

Joining me now, Mary Lovely, senior fellow at the Peterson Institute for International Economics.

Okay, so when you break down what we know is this a truce -- a trade truce between the U.S. and China or something bigger than that?

[16:10:02]

MARY LOVELY, SENIOR FELLOW, PETERSON INSTITUTE FOR INTERNATIONAL ECONOMICS: Yes, great question, Jim. I would say it is setting down of arms, at least

for now, but not armament. Both sides, as you mentioned earlier, for example, the Chinese export controls are being deferred. The U.S., of

course keeps in place its export controls. We still have the possibility of more tariffs. President Trump and U.S. Trade Rep Greer have already queued

up a new Section 301, so-called export crowbar case against China for its failure to meet the terms of the Phase One Deal. So, you know, there is

still a lot of firepower standing at the ready.

SCIUTTO: I wonder who you think gained more out of this? I mean, when you look, for instance, soybean sales. Okay, that will be a relief for U.S.

farmers, but China was buying soybeans before, it just stopped in the midst of this trade war. So to some degree, it is returning to the status quo.

Who gained the most out of this back and forth?

LOVELY: Yes, I think in some sense, the U.S. blinked. We are back to a status quo. China is, you know, reverting back to purchases that are

already made. When we think back to kind of the systemic or structural issues that the U.S. wanted the Chinese to address, things like industrial

subsidies, reviving their own domestic demand, opening up their markets to U.S. exports more. We haven't seen any of those outside of agriculture,

really.

So I think, you know, the harder systemic issues still remain on the table and not only that, China has gotten U.S. basically to push them even

further, you know, away.

SCIUTTO: How about on that big goal of Trump's tariffs as it relates to China, which is to bring the manufacturing that take place -- takes place

in China to the U.S. I know there has already been a lot of measures of this that hasn't shown much from any countries, right, returning to the

U.S. given higher labor costs here, but did any manufacturing of goods leave China and return to the U.S. or on the way back to the U.S. as a

result of this nearly year-long trade war?

LOVELY: Well, I wouldn't want to say there is none, because usually there is some counter example out there, but certainly nothing that can be picked

up in the aggregate statistics. Manufacturing has left China, but it has gone to places like Vietnam and those countries are now emerging as kind of

middlemen.

That doesn't mean that nothing is happening inside those countries. There is a lot happening. Chinese firms are investing, Vietnamese workers, Thai

workers, Cambodian workers are being employed. They're making things that are being sent to the United States.

There are also -- we've seen that because, you know, our reliance on China went from about over 20 percent of our exports to closer to ten. So we are

seeing a big falloff in exports directly from China. That doesn't mean that Chinese value add is not still in most of those products.

SCIUTTO: And how about the final word now on TikTok here? You now have American investors owning a majority stake, but ByteDance, the parent

company, still owns 20 percent. I mean, the key issue is meant to be a National Security issue, and that was the subject of the bipartisan

legislation that required a sale. Has that issue been solved?

LOVELY: It has been, I think, solved perhaps for this administration. Obviously, people who think that there isn't a way around this, you know,

security risk posed by deeper integration of Chinese tech into U.S. tech will not be happy with this solution. But I think for the Chinese, they see

it as perhaps a signal of how you know, their investments in the U.S. could be structured in the future. This is something that they would really like

as they're moving forward not only E.V.s.

E.V.s to the economy is actually rather a small share. The Chinese see their future in A.I.-plus, that is in providing, you know, the robots that

will be guided by A.I., for example, and the equipment and the U.S. would certainly be a market for that, but that requires some kind of agreement on

how security risks from that sort of integration would be handled, and this TikTok deal may provide some glimmers of hope for them.

SCIUTTO: Mary Lovely, good to have you on. Thanks so much for joining.

LOVELY: Thank you.

SCIUTTO: The CEO of Delta Air Lines says its new flights, direct ones to the Saudi capital, will be an amazing opportunity for the airline and its

passengers. Richard Quest spoke with Ed Bastian at the FII Summit about the new route between Riyadh and Atlanta. Flights beginning October 2026.

Bastian said Delta's partnership with Riyadh Air will provide its customers access to a strong domestic market. He told Richard about the excitement in

the region.

[16:15:05]

(BEGIN VIDEO CLIP)

ED BASTIAN, CEO, DELTA AIR LINES: And when you're on the ground here in Riyadh and you see the vibrancy, you see the development, you see the

growth in this marketplace, I think it is going to be a great route and it will not be the only flight that we are having to Riyadh.

RICHARD QUEST, CNN INTERNATIONAL HOST, "QUEST MEANS BUSINESS": What is the purpose of the flight? Is it for O&D, origin and destination, or is it

ultimately to build out through connectivity?

BASTIAN: Well, I think it is to bring U.S. consumers, business, leisure travelers to Saudi Arabia and to Riyadh, specifically.

QUEST: You were late to the region. I think even you might agree, and by the time you're looking for dance partners, the other carriers were pretty

much in bed with somebody else. But history might prove that you chose you -- he who came too late chose wisest in a sense, because this is going to

be the growth area in the region.

BASTIAN: No question. This is an amazing, amazing opportunity for us. You know, we've been vocal over time about the subsidies and the lack of a

level playing field here amongst the Middle Eastern carriers, the Emirates and the guys in Doha, as well as in Abu Dhabi and we were not ever even

contemplating partnerships with those three airlines because they don't have a local market.

They basically exist to take traffic between two other home markets, neither of which are theirs and we didn't want to have someone else live

off our hard earned territory and the work that we've done, waiting and actually having the opportunity and we've been working on this for a couple

of years with the PIF, as well as Tony and the Riyadh Air team for the right opportunity in a country that has a very large home market, that has

where the commerce is.

People don't appreciate that Riyadh has four times the GDP that Dubai has as a city, and when you think about the long-term aspiration here and

growth, I know we are in the right place.

QUEST: Because of the criticisms about the state-owned airlines, initially, it does seem, are my words not yours hypocritical to then get in bed with

one of them? But you're telling me that the distinguishing difference because, you know Riyadh Air is state owned --

BASTIAN: Of course.

QUEST: But you're saying the distinguishing difference is the size of the domestic market in Saudi?

BASTIAN: Yes, the size of the whole market, which is a country with 35 million people versus what you have locals in Doha or Dubai, which are --

which is a small, small fraction of that. Secondly, I know the team at Riyadh Air is destined to prove their own weight, and obviously with PIF

starting them, they're going to require a considerable amount of start-up investment. I think that model is going to be very successful and very

profitable for PIF.

QUEST: The premium market. It is quite a contradiction, isn't it, that actually it is all about premium now.

BASTIAN: Yes.

QUEST: Not only for business travelers who traditionally have gone premium, but this premium leisure. You and I have spoken about it last time when we

were in Atlanta, this premium leisure is crucial as well.

BASTIAN: We live in the experience world, the experience economy and people are willing to invest far more in themselves than in what they own. You

know, we've seen behaviors change, particularly amongst those at the upper income strata. This is the number one decision that they have for

discretionary dollars is to go into travel and to experience and that can be an international trip to Riyadh or it could be a great restaurant in

their home market.

QUEST: Does that create certain revenue issues or revenue management issues because, you know, they want the front seats and yet the business traveler

also does, but actually in some ways, premium leisure is taking over from the -- you tell me what you're seeing.

QUEST: Well, premium leisure many times pays us more than what our business travelers. The business traveler is really important and Delta is the very

best in the business at it. The corporations get a meaningful discount because they buy in such volumes.

So when you look at it on a yield basis, seat for seat, premium leisure many times actually is willing to pay far more than corporations will.

QUEST: Air traffic control issues in the U.S. at the moment. You're a victim like everybody else, in a sense of the government shut down. There

is nothing much you can do about it other than hope it ends soon.

BASTIAN: I hope so. I hope so, hopefully in the next, next couple of weeks. It has to --

QUEST: Are you being badly affected in all your hubs?

BASTIAN: We are not being affected in a meaningful way, but the longer this goes, I think it will start to have some impact.

QUEST: Are you seeing any reluctance inbound to the U.S. of people who do not want to travel to the U.S., either because they fear an unfriendly

arrival experience or they just simply, you know, based on geopolitics, they don't want to visit America.

BASTIAN: We've seen some avoidance issues.

QUEST: I mean, besides Canada, which is obviously --

[16:20:02]

BASTIAN: Right. We've seen some avoidance. We have backfilled it with more Americans heading out because the desire -- the demand for U.S. to go

abroad is high, 80 percent of our point of sales is turning into U.S. point of sale for international.

But yes, we've seen some of that.

(END VIDEOTAPE)

SCIUTTO: Argentine President Javier Milei, he scored a major victory in the country's midterms. Anything less could have threatened a hefty financial

lifeline from U.S. President Donald Trump. I am going to discuss with Edward Luce of "The Financial Times," next.

(COMMERCIAL BREAK)

SCIUTTO: The Argentine Peso is soaring after President Milei's party secured a sweeping victory in midterm elections there. The better than

expected results give Milei a mandate to push ahead with his economic reforms. He says, the victory also gives new hope to Argentina.

(BEGIN VIDEO CLIP)

JAVIER MILEI, ARGENTINIAN PRESIDENT (through translator): We have a unique historic opportunity as a country. We have the responsibility to put aside

partisan interests and think as a country, we trust that we can work together with all the forces with whom we have common ground to achieve the

changes that Argentina has been crying out for, for so many years.

(END VIDEO CLIP)

SCIUTTO: The Argentine peso jumped more than three percent on those election results. Some analysts say voters feared the economic consequences

of abandoning Milei's austerity policies. President Trump, you may remember, threatened to withdraw an enormous, multibillion dollar financial

lifeline if voters didn't choose Milei's party.

Edward Luce is the U.S. national editor at "The Financial Times." Good to have you on. Thanks so much for joining.

EDWARD LUCE, U.S. NATIONAL EDITOR, "THE FINANCIAL TIMES": Thank you, Jim. Always a pleasure.

SCIUTTO: So I wonder, do you see this as a short term reprieve for Milei and the reforms he is pursuing or a longer, more lasting vote of confidence

in him?

LUCE: Well, it certainly beats the alternative, and if the Peronists had won these midterm elections, then Trump would have found $20 billion, this

credit swap lifeline that he threw Milei earlier this month, he would have found that that went down the drain, and he had threatened Argentinian

voters with that if they did vote for the Peronist.

So to some extent, Trump engineered this victory and bought Milei time to try and generate the foreign exchange revenues to pay off the massive

foreign debt bills that Argentina has to pay every year, $18 billion over the next year.

[16:25:18]

So yes, it buys Milei time. It is certainly better than the alternative from Milei's point of view, but it doesn't fix Argentina's underlying

structural problems.

QUEST: Buying is a key word there in that you mentioned, and we mentioned in the introduction that President Trump had made it quite clear that if

Milei's party had lost, he might have withdrawn that lifeline. Is it your sense that voters effectively listened to that threat and said, hey, we

better vote for him, otherwise Trump is going to abandon us?

LUCE: So my understanding from the reporting of some colleagues of ours who are there and steeped in the Argentinian political scene is, yes, that did

have an impact on voter psychology. But it doesn't mean to say that this aid is a freebie for Argentina.

You know, trump wants Milei to cut ties with China. China is also a creditor to Argentina. And also, as it happens, has a $20 billion credit

line to Milei's Central Bank and cutting that as a price of Trump's continuing support is not something Milei wants to do. He is asking for

support wherever he can get it because this battle to stop the collapse of the peso and trigger another sort of default, Argentina has had nine

defaults in its history, three bankruptcies in the last 25 years.

To try and stop the next one, you know, he needs help from wherever he can get it and Trump has made it pretty clear that the condition for his help,

is that Milei spurns China and he doesn't want to do that.

QUEST: You noted in your piece earlier this month that some big U.S. banks are somewhat wary of taking a risk on Argentina. I mean, their record going

back years on defaults, in that region and elsewhere is, well, you understand why they have some concern.

LUCE: Well, you do. I mean, they've taken a lot of haircuts, as they say, in the markets. This is like being busiest barber, you know, in the world,

the Argentinians and so banks are sort of, I won't say once bitten, twice shy. I mean, they've been bitten many times as have other investors.

It is a great moment, though, for, you know, junk bond and vulture bond investors because, well, we are seeing a real boom, a rebound, at least for

the time being in Argentinian debt prices. As I say, this buys time. But what Milei has to do to generate -- to have an economy that generates the

kind of growth that will allow Argentina easily to service its foreign debts and then move beyond this terrible period of bankruptcies that

involves a lot more -- that involves a lot of haircuts for the Argentinian average person, so this is a very difficult equation.

QUEST: When you look at Donald Trump's approach to two major countries in Latin America and the contrast, right, Argentina, he likes Milei, offers an

enormous bailout, $40 billion in the midst of a government shutdown here in this country.

In Brazil, where his friend is being prosecuted for attempting to overturn the election, the penalty, right, is 50 percent tariffs because Trump

doesn't like that and he wants to apply economic pressure. I mean, the common theme there, right, is if you're a friend of Trump, you get taken

care of and if you're not, you get penalized.

But is that a contiguous U.S.-Latin American policy, or is it really just the personalization of U.S. foreign policy via how Trump sees it from his

own perspective?

LUCE: I think, a lot of it is the personalization. I mean, as we were discussing, you know, it is in Argentina's interests as it is in most

countries, you know, that are not America and China, to have good trading and financial relationships with both America and China and we are seeing,

you know, a closing of economic cooperation across Latin America with China whilst making attempts not to fall out with the United States, so that's

what most countries want.

Brazil is an interesting case because Lula, the Brazilian President, has had 50 percent tariffs slapped on his country by Trump as a punishment for

the jailing or the prison sentence handed out to Jair Bolsonaro, Trump's friend and former President. It might be the case that Lula will get some

kind of a reprieve in the coming days. There have been talks between U.S. and Brazil.

[16:30:15]

So you do also have to, with Trump, go back to what one of my colleagues, one of my -- the trade specialists on "The Financial Times," Alan Beattie

calls and describes as nobody knows anything, unpredictability is part of Trump's, you know, way of doing business.

SCIUTTO: Yes, no question. And listen, that China piece is interesting because it's not just Argentina, Brazil. I mean, some of America's closest

trading partners, including in Europe, Canada. I mean, they're saying, listen, you know, as we go through the trade wars, we actually have to

expand our markets, and that includes China. So, that's one area of contrast with Trump's intentions.

Ed Luce, great to have you on, thanks so much.

LUCE: Real pleasure. Thank you.

SCIUTTO: Coming up, Jamaica braces for the year's most powerful storm so far, we will have a report from Kingston as Hurricane Melissa closes in.

(COMMERCIAL BREAK)

SCIUTTO: Hello, I'm Jim Sciutto. There's more QUEST MEANS BUSINESS in a moment when we'll discuss why some insurers in the U.S. have been employing

stealth tactics to increase the deductibles for policyholders.

And a new lead in the hunt for the stolen crown jewels in Paris. What French police are learning from two men they arrested.

Before that, the headlines this hour, President Donald Trump will meet Tuesday with Japan's first female Prime Minister Sanae Takaichi.

Earlier, Mr. Trump visited with the Japanese Emperor Naruhito on the second leg of his Asia tour. He is expected to meet with Chinese leader Xi Jinping

later this week for critical trade discussions.

The Argentine president's party has cruised to a vital midterm victory. It gives Javier Milei a mandate to keep pushing through on his radical

overhaul of the country's economy.

[16:35:04]

In response, Argentina's stock market has jumped in Monday trading. President Trump said earlier this month that a bailout package for

Argentina hinged on his ally winning the election.

The longtime president of Cameroon has won re-election yet again. Official results show that 92-year-old Paul Biya got more than 53 percent of the

vote. He will now start his eighth term as president after ending presidential term limits more than 15 years ago. He's president that's way

back in 1982.

Jamaica's climate change minister says the time for preparation is all but over as Hurricane Melissa bears down on the island. The storm rapidly

intensified over the weekend, it's now a Category 5, and yet continues to strengthen.

Jamaica is expecting months worth of rain in a matter of days. Authorities used heavy machinery, as you see there, to bag sand and protect buildings

in the capital, while residents along vulnerable coastal areas are evacuating.

CNN Meteorologist Derek Van Dam has more.

DEREK VAN DAM, CNN METEOROLOGIST: I'm in Kingston, Jamaica, where we are bracing for impact. Hurricane Melissa, a Category 5 monster that exploded

in size and intensity, and it is going to bring catastrophic amounts of rain and wind to this island nation. It is in rare company in terms of its

strength. It is the strongest storm on the planet in 2025 and one of the stronger storms ever recorded in the Atlantic basin.

So, just to give you a scene set of where we are in Kingston, there's a lot of sheet metal, a lot of unfinished buildings, rebar that could easily

become projectiles. And then the big concern that I have are the mountains behind us. This encompasses much of the island of Jamaica, very mountainous

terrain that rain that will fall nearly 1,000 millimeters forecast in this projection will have to go somewhere.

And unfortunately, it will be funneled into the communities and the locations where people live, the catastrophic winds we're talking over 250

kilometers per hour. This will bring destruction where the center of the storm makes landfall, and then the storm surge component to this hurricane,

depending on where it actually makes that landfall, along the southern coastline, is where we will get the most devastation from that wall of

water.

So, we have a slow motion -- a slow-motion disaster that will unfold here in Jamaica. It is really a concerning next 48 hours as this storm will

crawl across this island nation, and then after this, it's got its eyes set on Cuba. Back to you.

SCIUTTO: Thanks to Derek Van Dam there. Just after filing that report, he spoke to the Jamaican Prime Minister Andrew Holness about how his office is

planning to manage hurricane response.

(BEGIN VIDEO CLIP)

ANDREW HOLNESS, JAMAICAN PRIME MINISTER: Look, the key to this is to ensure that you are properly prepared and during the disaster, you manage how

people respond. And if those two things are done correctly, then at the end of the disaster, you're in a much better position to recover more quickly.

And so that's what we're trying to do.

The preparations are in place. We believe the citizens are in a much better position how to treat with the disaster. And then as soon as the hurricane

has passed, then the relief effort, the recovery effort, the rebuilding effort, all of those have been lined up.

(END VIDEO CLIP)

SCIUTTO: The president of Venezuela, Nicola Maduro, says the U.S. is looking to fabricate an excuse for war.

On Sunday, the guided missile destroyer the USS gravely arrived in Trinidad and Tobago. The largest aircraft carrier in the world, the USS Gerald Ford

is now on its way to the seas off Venezuela. All this as President Trump has accused Maduro of leading a drug gang.

Republican Senator Lindsey Graham, a Trump supporter, had this new warning for Venezuela.

(BEGIN VIDEO CLIP)

SEN. LINDSEY GRAHAM (R-SC): We're going to blow them up and kill the people that want to poison America, and we're now going to expand operations, I

think, to the land.

So, please be clear about what I'm saying today. President Donald Trump sees Venezuela and Colombia as direct threats to our country because they

house narco terrorist organizations.

(END VIDEO CLIP)

SCIUTTO: Kylie Atwood joins us from Washington. We're going to blow them up, and he now sees land operations coming. Just how far do we know at this

point do the Trump administration's plans extend?

KYLIE ATWOOD, CNN NATIONAL SECURITY CORRESPONDENT: It's a great question. We've heard differing things from different sources, but we've heard as

recently as late last week is that at the White House, President Trump himself is considering plans to go after cocaine production, drug

production inside of Venezuela. So, that would obviously be land targets that the United States would be going after.

[16:40:22]

So far, they haven't gone that far. They've gone after these drug boats that have been in the Caribbean region, these alleged drug boats that have

been they say, on their way smuggling drugs to the United States.

But Jim, this comes as there is this massive military buildup in the region. So, everyone is trying to figure out exactly what this military

buildup is essentially for.

We heard from Senator Lindsey Graham, as you said there, that he does believe that land strikes are a real possibility here. He also said that

President Trump told him that when he returned from Asia, that Congress should expect a briefing on what could be potential U.S. military

operations in both Venezuela and Colombia.

So, Senator Graham is indicating which President Trump did in one -- at least one Truth Social remark that there could be strikes against drug

trafficking inside of Colombia, not just inside of Venezuela.

So, this is clearly a space for us to watch. It is one that we know the Trump administration is really focused on. They continue to say that those

strikes against those drug boats are going to continue. It's not something that they have said is going to be ending anytime soon.

SCIUTTO: Remember, back in the first administration, Trump talked about using the military to strike drug targets in Mexico. At the time, everybody

said, oh, well, that's never going to happen. That's crazy. And anyway, here we are.

Kylie Atwood, thanks so much.

Police have now made arrests in connection with that audacious heist at the Louvre Museum. Police say other suspects, however, remain at large. We're

going to be live in Paris next.

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[16:45:01]

SCIUTTO: Police have now arrested suspects in connection to the theft of France's crown jewels from the Louvre Museum in Paris, two men in their 30s

detained over the weekend. French media report they were caught after police analyzed more than 150 samples of DNA left at the scene of the

heist.

However, two other suspects remain at large. Melissa Bell joins me now.

So, Melissa, I wonder, when I saw these arrests, my first question was, do they think they actually got the guys who climbed in that window and walked

out with the crown jewels? Are they looking at pieces of sort of a larger gang here?

MELISSA BELL, CNN SENIOR INTERNATIONAL CORRESPONDENT: Look, they're remaining really tight lipped. French authorities about all of their

investigation, Jim and it's been now more than a week that not just us here in Paris, but the whole world, has been wanting to know more about how this

heist could have happened and what the latest was and what they knew.

What we do understand, they've had to release almost despite themselves, there was a fairly frustrated announcement made by the Paris prosecutor on

Sunday morning about the fact that they'd made these two arrests on Saturday night, explaining that it was because there had been leaks the

French press that they were having to confirm it.

I think, had it not been for those leaks, we might know nothing at all about them so far. They had to make it plain and public then that they had

these two men in their custody, one who'd been trying to flee the country on his way through Charles de Gaulle to Algeria. Another, as we understand

a gym who'd been preparing to flee Tamale, and that was why we understand they had to act quickly.

What we are beginning to piece together is that these do appear to be two of the main suspects they'd been hoping to get their hands on. There were

four people involved.

Remember, in that commando team who took part in that heist on Saturday -- on Sunday morning rather, the question is whether it was them who had

commissioned it, or whether it might not be somewhere -- someone completely different from those who were actually implicated in the operational heist

itself.

Certainly, two of the people appear to have been taken, they have authorities until Wednesday to interrogate them and try and get as much

from them as they can. Another couple of suspects, of course, remain at large, Jim, and as do the jewels.

For the time being, we understand that they're no closer to figure out where the jewels are, which will, of course, be their priority.

And you're quite right. They've been working on so much evidence that was left behind, and this is what a number of analysts looking at this heist

are telling us is that this was very well prepared, very well organized. Whoever commissioned this had thought this through a great deal, but in the

end, was relatively botched by the people who actually took part in a heist, insofar as they left behind not just all of the tools that they used

to get in and out of the louver but so much other evidence as well, one of the scooters they escaped on, a motorcycle helmet, a glove, 150 different

traces of DNA that investigators have been able to work off to try and make progress in their investigation.

As to the two men in custody, Jim, we understand that they were known to police before, which means that their DNA would have been on police

databases, and that would have helped them get find them a lot quicker. The four men we understand they had been watching for several days before these

arrests were made, but felt that they had to act quicker on these two simply because of the flight risk that they represented, Jim.

SCIUTTO: Goodness, wow. Well, that's pretty fast police work. Melissa Bell, thanks so much.

Britain's King Charles has been heckled by a protest today over his brother, Prince Andrew's ties to the late child sex offender Jeffrey

Epstein.

The King was greeting people there while visiting a cathedral in central England, when, again, as you can hear, a man started yelling in his

direction. Prince Andrew has agreed to give up most of his remaining royal titles, including Duke of York, due to ongoing scrutiny over his ties with

Epstein.

Insurance deductibles are going up for millions of Americans without their knowledge, as insurance companies look to offset the costs of more frequent

extreme weather, we're going to have all the details next.

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[16:51:39]

SCIUTTO: Several insurers in the U.S. have been employing stealth tactics to increase the deductibles of policyholders. Changes to the fine print of

policies have led to a cut in payouts to millions of Americans, this according to Financial Times.

The move comes as insurance companies grapple with the costs of more frequent extreme weather events, which has led to greater losses on many

home insurance policies.

Joining me now, Tim Zawacki, senior research analyst at S&P Global Market Intelligence. He covers the U.S. insurance industry. Thanks so much for

joining, Tim.

TIM ZAWACKI, SENIOR RESEARCH ANALYST, S&P GLOBAL MARKET INTELLIGENCE: Great to be here, Jim.

SCIUTTO: So, I mean the two elements of the story, one is raising deductibles without telling your customers, that's one thing but, just

before we get to that, the core of this is insurers saying they got to pay out a lot more because of the frequency of climate related events and more

severe storms, more severe fires, hurricanes, you name it. I mean, is that -- does the data back-up that claim that their expenses are rising?

ZAWACKI: Well, just a statistic for you U.S. insurers between 2017 and 2024, homeowners' companies lost upwards of $40 billion on their

underwriting, and a lot of this due to all of these kinds of events, whether it's hurricanes, hailstorms, wildfires, as we saw earlier this year

in Los Angeles.

So, the industry has reevaluated in many ways, the way that these policies are structured. People have become very comfortable with how homeowners'

policies are structured and what they would expect to pay in the event of a claim.

And now it's more important than ever to look at the terms and conditions of those policies, because, as you mentioned, there's a number of different

elements that have been changing as companies attempt to reduce the volatility that they've been facing year in and year out from these more

frequent and severe storms.

SCIUTTO: I mean, the other thing that's happening right is some insurers are just flat out refusing to insure homes and businesses in some places

too.

ZAWACKI: So, that's a big part of what's going on. The industry has been able to take advantage of much more sophisticated technology in a couple of

ways, and looking at the business that they insure, one of the ways they do that is through what's called catastrophe models, and they gage the amount

of exposure an individual property might be at risk for, for Any type of different extreme peril, whether it's a flood hurricane or severe

convective storms. And when I say severe convective storms, that means things like hailstorms, tornadoes, straight line winds.

And some of these events have not been very well modeled in the past, and the industry is just getting a better sense is exactly the kind of exposure

that they could face in some of the more extreme events.

The other piece of this is that they are able to employ much more granular and sophisticated aerial imagery, even use of drones to evaluate the

condition of a property, whether that's having very large tree limbs hanging over your house, or maybe your roof is only 5 or 6 years old, but

it isn't holding up as well as one would assume, for a roof of that age.

[16:55:19]

And ultimately, the industry is looking to make sure that they stay solvent and are able to pay claims when they can do and to do that, they're looking

much more closely at individual properties to make sure that the rate that they charge match matches the risk that they're facing.

SCIUTTO: Now, somehow, though, despite all these increased costs and payouts, aren't insurance companies pretty profitable historically right

now?

ZAWACKI: So, this has been the last couple of quarters, you know, quite a good year for the insurance industry, particularly the companies that do

personalized insurance, so your home and auto insurers, but it was only nine months ago that Los Angeles faced historic losses from wildfires, and

some companies got hit very hard with that. We have that Category 5 storm churning off the coast of Jamaica, which you know, again, it's by good

fortune that the industry has avoided any significant hurricane damage this year.

So, we think the worst of the rate increases are beyond what most homeowners will be in the next round of bills. They're facing, perhaps

seeing the last of the large increases in homeowners premiums, but these changes to the structure and the terms and condition, we think they're here

to stay.

SCIUTTO: Tim Zawacki, read the fine print. Thanks so much.

Wall Street closed at yet new record highs. This in anticipation of something of a trade deal between China and the U.S. News of a framework

deal between Beijing and Washington sent the Dow up more than 300 points. S&P and NASDAQ both closed more than one percent higher.

Let's look at the Dow components now. Nvidia closed up 2.8 percent after competing A.I. company Qualcomm announced two new A.I. chips for data

centers, Microsoft, Amazon and Apple. All members of The Magnificent Seven are releasing earnings later this week, and all gained around two percent

already. Walmart closed down almost two percent despite releasing new Black Friday sale details.

That is QUEST MEANS BUSINESS for today, I'm Jim Sciutto, "THE LEAD" with Jake Tapper, starts right now. Thanks so much for joining.

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