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QUEST MEANS BUSINESS
24,000 Magic for the Dow; Trump and May Clash Over Tweets; Twitter Employee Admits Trump Account "Mistake"; Bitcoin Goes on Wild Ride Past $10,000. Aired 4-5p ET
Aired November 30, 2017 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:00] RICHARD QUEST, CNN HOST: You know, the lot there, The Rockettes, a market that is at record levels. They're going to light the
Christmas tree at the New York Stock Exchange and a Santa Claus. What more do you want? Come on, officer. Do the business. Yes, yes, yes. That's
what you get from New York's finest. As trading comes to a close. It's Thursday, today is November the 30th.
Think of tonight as 24-hour, 24-karat magic in the air. The Dow has surged past 24,000 for the first time ever. With trading partners like these,
Theresa May fires back at Donald Trump. The two cannot agree on those videos.
And the man who shut down the president's Twitter account tells us despite what everybody thinks, he didn't mean it.
I'm Richard Quest, live tonight from the world's financial capital, New York City. Where if you look at the numbers, it's clear, I mean business.
Good evening. What a day. Christmas has come early to Wall Street. The Dow Jones has passed the 24,000 mark, and the market just kept on going.
Look at the closing numbers, and you'll see the Dow came out straight out of the gate. It rose sharply. A bit of a down moment, but really
throughout the day up 331 points. The best day in months for the Dow. In fact, the best single day -- single-biggest points gain in more than a
So, we need to put this into perspective. And the way we do that is over here at the trading post. First of all, a bit of magic ourselves. There
is only one color for today and that is green. Thank you very much. The Dow is at a record. The S&P is at a record. No records for the Nasdaq.
But I shall just take a moment to just change the numbers, so we have 63, and we have 57. Those are the way the numbers look for the major markets
at the moment.
The Nasdaq, having had a very difficult day yesterday, now did recover somewhat three quarters of a percent. But not sufficient to make it into a
record. And you can see, 63 Dow records. S&Ps and 70 Nasdaq. The New York Stock Exchange is to light its Christmas tree later in the hour, and
we starting to feel the festivities a little bit early.
So, it's never too soon to bring the tree up, since it is the first of December. And the reason is, if you come close, you'll see the Dow has
risen through five milestones this year. 20,000 in January. All the way up to 21,000, 22, 23 and 24,000 today. And it only took six weeks to go
between 23 and 24,000. It's the biggest number of milestones in a single year. And there have been lots of gifts and reasons why the Dow has risen
so sharply. Take for example this little bauble, earnings. Earnings have absolutely powered ahead with the market, and that that has given good
reason for the Dow to rise. And then you have more gifts from shoppers, American workers and shoppers. It's the fastest GDP growth since 2014,
with strong consumer confidence numbers in both.
Let us not forget the role played by Washington in all of this. With Washington, you have gradual rate rises by the Fed. Now the feeling with
these rate rises is that this is going to ensure the long-term viability and sustainability of the economic recovery. And then the gift that just
keeps giving. Even before it's delivered, tax reform is very much -- we will have more to put on the tree, but we need to understand what it all
means. Joining me, Teddy Weisberg, is with me -- good to see you, sir.
TED WEISBERG, PRESIDENT, SEAPORT SECURITIES: Hello, Richard.
[16:05:00] QUEST: I mean, we won't go in any hats. But 24,000 on the Dow.
WEISBERG: Oh, yes, Yes. I added Dow 10,000 hat.
QUEST: That was some time ago.
WEISBERG: A little behind the curve.
QUEST: So, let's look at what happened and why. What is the underlying -- because yesterday the Dow was up but the techs were down.
QUEST: What is powering this? Today it was obviously, Senator McCain, saying he'd vote for the tax plan.
WEISBERG: I think it's a couple of things right here at this moment. I think it's the new Fed chair, who basically did very well at his hearings,
and the street didn't hear anything that made anybody uncomfortable. Looks like it will be business as usual when we change chairman at the Fed. And
I think that was a big positive. Certainly, for the financials. And then it's the tax bill. And today, you know, as we get closer to it, I mean,
it's not done yet, and until it's done, you know, we'll not be sure. But clearly, you would think a lot of the tax bill is priced into the market,
but clearly, it's not.
QUEST: And even -- if it is priced into the market, is there any concern buy on the rumor, sell on the news, when this bill passes you get cream off
WEISBERG: Yes. Well, I think that's absolutely a fear observation. Sell on the news and the news would be when the bill finally gets passed. But
the bill probably has such dramatic impact on the economy. Not just today, but for years to come and we simply don't really understand that yet. It's
really too soon for us to figure all that out.
QUEST: Allan Valdez who you know well, of course, down at the exchange, was telling me this morning, the biggest benefit could be for smaller
companies. Because they will see the full throttle of it, and they don't - - their average rate at the moment is higher. Which is why we see in the Russell 2000 at a record level, as well.
WEISBERG: Well, listen, a rising tide floated a lot of ships today. Even got the techs out of the hole they fell into yesterday. But I think it's -
- what you suggest is a possibility, sell on the news and the bill gets signed. And the immediate reaction might be, well, all right, now that's
done. What's next? But I think the implications for this, for corporate America, for the U.S. Economy, and perhaps, for the world's economy, is
significant beyond what any of us really quite understand at the moment.
QUEST: But it sort of begs the issue that on the one hand we have this market roaring up. But on the other hand, we have an element of disarray
in Washington, former Washington, with the President. Some sort of suggesting is he up to the job, is Tillerson in, what -- the trade
negotiations with NAFTA. At what point -- if at all, and maybe not, do these worries become relevant?
WEISBERG: Well, I think they're all relevant. But they seem to be being Trumped almost daily by the prospect of better corporate earnings and a
better U.S. economy and better world's economies. Because at the end of the day, that's what's going to drive the stock market. Not politics.
QUEST: I'll tell you what, let's have an agreement.
QUEST: In the unlikely event that we hit 25,000 before the end of the year, we'll both wear one of these hats
WEISBERG: My pleasure.
QUEST: I think we may have just made ourselves hostage. Great for you to come up here and talk to us. Thank you very much.
WEISBERG: Thank you, appreciate it.
QUEST: Thank you very much indeed.
Now, the rally is broad-based, and the blue chips are the ones benefitting. I want you to join me over at the super screens, and you'll see exactly how
you've got here. Just look, this is today. But you'll see the nature of this rally. Everything from the engineering and industrials, 3M and
Boeing, the techs, Apple, good old solid companies like Caterpillar.
Today, if you were not winning, it was because of your own unique problems. And that, I think, is why you clearly see poor old GE, which has got such
terrible problems of its own, languishing. I mean, come on. To lose one and a quarter percent on a market like today speaks volumes about GE's
problems. More than two-thirds of the Dow stocks have risen this year, and if you look at the -- those that have gained most of all, you've got Boeing
up 50 percent this year. Apple, 40 percent. McDonald's and Visa, 30 percent. Caterpillar up a quarter. These are extraordinary results,
predicated on the back of trade and good earnings. Paula La Monica, who will join us wearing a silly hat if it gets to 25,000 over there, good to
see you, Paul.
PAUL R. LA MONICA, CNNMONEY CORRESPONDENT: Thank you.
QUEST: What do you make of the sectors that -- I mean, look. Start from the position. Nothing is going to rise like tech at the moment. But what
we saw on those sectors is very impressive.
LA MONICA: Yes, I think it is. You're starting to see a broadening out of the rally a little bit. Tech was a loser yesterday. But participated once
again in the gains today.
[16:10:00] And I think it really just does go to show -- as you and Teddy were talking about -- earnings are what really matter for this market. And
earnings growth has been very strong for the technology sector. The tax reform bill that people are hoping will get through the Senate. Then get
rectified the House and eventually past President Trump. That will help the financials a lot.
QUEST: Where is the weak point? We're looking at the Dow 30 now. Where is the weak point in that? Caterpillar obviously rises if the economy is
doing well and overseas companies are doing well also. Visa does well, similarly. But then you've got GE. What happened there?
LA MONICA: Well, GE, we know, has a new CEO that is desperately trying to clean house. There were so many mistakes made during the Jack Welsh era
LA MONICA: Immelt. Yes, I was like, what is his name? Jack Welch and Jeff Immelt. And really the company just got so bloated they had to start
downsizing. And I think Flannery is going to escalate some of the asset sales. GE needs to be more focused. So, at this point, why would you buy
GE just because it's GE. It has a great name and you know it, because it brings good things to life? That's not the case anymore.
LA MONICA: Buy Apple instead.
QUEST: All right. The prospects for growth. Obviously, the Dow is up so sharply, because the three largest stocks are -- four largest stocks,
United Health Care, Goldman Sachs, Boeing, and -- I think -- largest ones is Caterpillar in the top ten. Does tech follow on, because it didn't do
LA MONICA: Well, no, tech had a pretty good day. The Nasdaq was up nicely. And if you look here, I mean, Apple may not have rallied as much
as Goldman Sachs and some of the others. But still, they have been the leaders all year. This has been a market that Apple, Microsoft, Google,
Facebook and Amazon have really led the way.
QUEST: Good to see you, sir.
LA MONICA: Thank you.
QUEST: Thank you. We didn't get a chance to talk about retail. We'll talk about that next. We've got a hat for you, just in case it all goes to
25,000. All wearing hats.
Amid this wave of market optimism, the United Kingdom is hoping to make a partner from the U.S. and strike a trade deal once it has dusted itself off
after Brexit. The Anglo-American famous special relationship arguably in need of counseling at a crucial time. Theresa May has been clashing with
the President for retweeting the far-right anti-Muslim videos. It crossed the line for the ministers who had previously kept quiet at outbursts. And
the anger goes right to the top.
(BEGIN VIDEO CLIP)
THERESA MAY, BRITISH PRIME MINISTER: The fact that we work together does not mean that we're afraid to say when we think the United States have got
it wrong. And to be very clear with them. And I'm very clear that retweeting from Britain First was the wrong thing to do.
(END VIDEO CLIP)
QUEST: While everyone is fixated on Donald Trump's retweets, it underscores the tensions that exist over the hopes to reach a trade
agreement. Back in July, Mr. Trump promised a big and exciting trade deal. The Commerce Secretary, Wilbur Ross, told British investors, the U.S. wants
a closer relationship, there are challenges ahead. The U.S. And U.K. avoiding clashes over tariffs involving Bombardier and Boeing. Peter
Westmacott, is former British ambassador to the United States, good to see you, Peter.
PETER WESTMACOTT, FORMER BRITISH AMBASSADOR TO THE U.S.: Thank you.
QUEST: We talked in London a couple of weeks ago. The relationship seems to have -- between the U.S. and U.K. seems to be a bit more rocky. How
serious is the fact that the president decided to tweet back against Theresa May?
WESTMACOTT: My guess, Richard, is that that is instinct. This is a president who sends out a lot of tweets, some of it rather impulsive. Some
of it may not be fully considered. He may not have thought that Britain First was the kind of rabid right-wing Islamic phobic organization that it
is. He perhaps thought it was innocent, like America First. And good idea, and why not? But he didn't like being slapped down by Theresa May.
And so, he replied very quickly. I think it's much the nature of the person we're dealing with, rather than an indication that the disagreement
is that much more profound than anything else.
QUEST: Except the U.K. is going to need the U.S. for a trade deal. And the -- and probably sooner rather than later. And -- or at least the
indications of one. And the last thing that Downing Street needs is a capricious president that might take umbrage.
WESTMACOTT: It's Jess going to be a trade agreement with America, a free- trade agreement. Which is what President Trump has talked about. The British government is talked about. It's going to have to be negotiated by
the professionals. I don't think it's going to happen any time very soon. After all, we are dealing with a president who is essentially pretty
protectionist and who talks about America first, and fair trade rather than free-trade. But you're right. The United States is going to be a hugely
important trade partner for Britain if we leave the European Union. And so, getting off to a good start in those negotiations will be important.
But I'm not sure that this rather disagreeable set of retweets has any real impact on that.
[16:15:00] QUEST: If you were advising Downing Street -- well, first of all, what would you have said to Washington if you had been in post? And
secondly, how would you have reported it back to the foreign office and to Downing Street what they should do?
WESTMACOTT: Of course, with tweets, you don't have very long to respond, because it moves so quickly. I think my instinct would have been to try to
get it taken down, straightaway. Because this was unhelpful. I like to think it wasn't designed to be unhelpful. But look how badly it's gone
down with Muslim communities not only in Britain but further afield.
And of course, it also gives exposure and credibility to an outfit that nobody has heard of before. And suddenly 45 million people have heard of
something called Britain First. And frankly, doesn't deserve it. And is not helpful to any kind of racial or social harmony. So, I would have
tried, I think, if I could have done, to get those taken down. Of course, now, given that the President has fought back. He's not very likely he's
going to either apologize or take down these tweets. But I think it would be helpful if they were taken down.
QUEST: OK. Perhaps the most tricky issue to talk about is how the rest of the world -- how the diplomatic world sees President Trump. When they see
these sorts of things happening. When they see the way in which -- frankly, he has no qualms about slapping down another foreign leader. This
is completely different to any way that you had ever learned about how to do diplomacy. Is there a feeling amongst some in the diplomatic or
international community that he's lost the plot?
WESTMACOTT: I think there has been a view for a long time that we have a very different sort of president. Who does say stuff, do stuff, which is
sometimes ill considered. Is there any suggestion that it's worse now? I've heard people -- I'm visiting Washington as it happens at the moment.
I've heard people say this is worse than usual. Maybe there's something going on. Maybe there's additional stress. Maybe he's lost the plot. I
have absolutely no reason to believe that. But I think that this sort of Twitter and that sort of response isn't helpful.
And it is unusual that you've got the United States and the United Kingdom having a public disagreement of this sort. And on something which is of
such sensitivity to our communities, not only in Britain, but also elsewhere at a time when we are all busy trying to ensure that outrage by
individuals is not seen to be the responsibility of entire Islamic community. So, it's difficult. It's unhelpful. I have no idea whether
this means the plot is being lost. I suspect this is more of the same and the nature of the beast.
QUEST: Peter, good to see you, sir. Safe journey home afterwards. But thank you.
WESTMACOTT: Thank you.
QUEST: As we continue QUEST MEANS BUSINESS tonight, we're going to be talking to chief executive of Sasol. He'll be joining me, and we'll be in
the C-suite to discuss oil, gas, OPEC, Southern Africa. We have a lot to talk about. Come and join me.
[16:20:00] (COMMERCIAL BREAK)
QUEST: Welcome back. Saudi Arabia got exactly what it wanted. OPEC and the other major producers agreed to extend production cuts to the end of
the year. The initial cuts came into a fact at the start of this year. You can see the way the price of Brent crude just came off a tad as it has
been. But the overarching trend, Brent crude has rallied above $60 a barrel. Ever since the summit it's been a particularly upward stream.
More than double the lows hit in 2016.
It's not enough, though, for some oil producers. A busy day of talks in Vienna. John Defterios is in Vienna for us. They got what they wanted,
John. Now they've just got to keep the discipline to ensure that price doesn't come back down again.
JOHN DEFTERIOS, CNNMONEY EMERGING MARKETS EDITOR: I think it's fair analysis on your part, Richard. Two of the biggest producers in the world
came here with their differences. They didn't divorce. And, in fact, one could even argue they got closer together. Don't forget, Saudi Arabia and
Russia, a year ago signed the agreement to cut 1.8 million barrels off the market. They're going to roll it over for a full year, and say they won't
even have better compliance. The Russians came in worried about the spike in prices that would open the door to more shale production. So, I asked
Alexander Novak, the minister, why do you come around to the Saudi position? And change strategy? Let's take a listen.
ALEXANDER NOVAK, RUSSIAN ENERGY MINISTER (through translator): What I want to say is that our objective is removing overhang, not overheat the market
in any way. When we see that rebalancing is happening, when it moves faster, we always have the option to sit down together, look at the
market's fundamentals, look at what adjustments we need to do. The reason why we are extending by nine months, is that we're sending a signal to the
markets, saying that we will do what it takes to reach rebalancing, and that we're ready to do it.
DEFTERIOS: There is some daylight between the Russian and Saudi position coming in, that at the closing press conference to my question, you went
out of your way to show that Saudi Arabia and Russia are very much aligned. What is the strategy here behind this?
NOVAK (through translator): I mean, I don't think I'll be too far off if I say that we are at a very high level in our relationship, also a
historically high level. And you can see that from many external signs. Mr. Putin and the King, they talk regularly. They discuss things over the
phone. And I'm sure that you remember quite well the historic visit of the King to Russia, which happened just recently. And this relationship
continues, these contacts continue.
But also, please don't forget that I'm not just responsible for energy partnership and energy relationships. As the co-head of the
intergovernmental commissioner with Russia and Saudi Arabia, I'm also responsible for developing our trade ties, for developing our economic
relationships. And I can tell you we have a lot going on in this space. So once again, I just want to stress that we are at a very high point in
our relationship. And we see more room for growth there.
QUEST: John Defterios, this relationship between OPEC producers and non- OPEC producers, it has been the fractious nature of that which has led to the collapse oversupply in the future. So, holding this together is vital.
Where did they see the price maintaining?
DEFTERIOS: Ideally, Richard, they can keep this ban of $60-$65 a barrel. Above that, of course, is going to welcome not only the shale producers but
the deep-water projects in Brazil and Africa that they don't want to try to come back into the market. It was interesting, Minister Al-Falih of Saudi
Arabia said to me during the opening session today, look, we've had a great realization. We can't rebalance the market on our own, Saudi Arabia or
OPEC. That's why we would like the Russia partnership. Russia doesn't want the market to overheat, as well. Hopefully they can keep the alliance
together. It's 24 now, Richard, but they had six observers here. I think they want to expand the club to try to stand up to shale. Don't forget,
next year the U.S. is going to cross 10 million barrels a day. Put Saudi, Russia and U.S. on the same plane. Very competitive with each other.
QUEST: John Defterios, thank you in Vienna for that.
The rise in oil prices has helped energy stocks along with the broader market. The South African energy giant, Sasol, is currently trading around
$31 a share on the New York Stock Exchange. But if you look you get an idea. All right, so the range ain't that great, from 27 up to 31. It's a
tight range. But the sort of Himalayan mountain nature of the trading gives you an idea of the difficulties that the company faces in these
environments. The joint president and chief executive, Bongani Nqwababa, joins me now.
[16:25:04] Good to see you, sir.
BONGANI NQWABABA, JOINT PRESIDENT AND CEO, SASOL: Good day to you, Richard.
QUEST: Make yourself comfortable while we get to grips.
NQWABABA: Thank you.
QUEST: With -- we saw your share just then.
QUEST: I mean, that is not particularly helpful for you in a capital- intensive industry of gas and oils to liquids.
NQWABABA: Fortunately, we focus on things within our control. And the great thing about the oil price coming down was to bring discipline to the
industry. Because when the oil price was at $100 per barrel, our break- even price, we were able to make money at $70 per barrel. Now we can make money at $40 a barrel, and our break-even is $35 a barrel.
QUEST: Which means you need to be careful at 60 -- I mean between 57 and 63, between west Texas and Brenton. At $63, the discipline goes.
NQWABABA: No, it doesn't go. Actually, we are waiting on continuous improvement now. Because it needs to be a culture, because in the industry
we are in, you never know when the difficult times will come.
QUEST: But do you worry at these now higher levels about U.S. Shale, which is such an enormous now producer, 10 million barrels a day coming out of
the U.S. Shale is going produce more at higher levels?
NQWABABA: In a strange way we welcome that. Because as a company, we are transitioning into being largely a chemicals company.
NQWABABA: So, if they have been rejected and us building our $11 billion project in Lake Charles, this is a wonderful opportunity for more at a
QUEST: Let's look at Southern Africa. Zimbabwe has this transition. There is eastern Africa, you've still got problems over with Kenya at the
moment. And South Africa itself, your home country --
QUEST: The economy is not good at the moment.
NQWABABA: Yes, the economy is going through a difficult time, but fortunately, we are now a very global business. Because at the moment, 35
percent of our earnings are from offshore, but when we commission our plant in Lake Charles it will be 50/50 and we're growing both locally and
QUEST: So, you don't want to abandon Africa though, do you?
NQWABABA: Not by any stretch of the imagination. For your own information, we want to grow our retail business in Southern Africa. We
want to grow our gas business in Mozambique, in Southern Africa, and we want to grow in the oil business in West Africa. Far from it. We want to
QUEST: Do you see opportunities in Zimbabwe, and if you do, what has to happen? What does the new president have to do to encourage you to come on
in a bit deeper?
NQWABABA: There needs to be liquidity. There needs to be confidence. Confidence is the biggest lacking issue.
QUEST: Confidence in what?
NQWABABA: Confidence in what? Are there rules, and will they not change. That is what -- is required. So, then investors can then invest, because
in our industry, we invest for 30 or 40 years. You do not want to invest when the rules might change in five years' time.
QUEST: Are you encouraged by what you've heard from the new president, Mnangagwa?
NQWABABA: Its early days, as they say it's green shoots, but time will tell.
QUEST: That's -- I'm -- that's a very lukewarm sort of -- I'm thinking about it, but I'm not sure, and I might on a good day, but let's wait and
QUEST: Because it's important to understand what will happen. Because you do not want to rush in with the fundamentals and not proof.
QUEST: Here in the United States is where you are at the moment. Obviously, again, opportunities abound. But you talk about the need for
certainty and an energy policy. And you have an administration seemingly not offering that at the moment, or are you content with what you're
NQWABABA: It's certainly from our industry perspective, it's net neutral to positive. Because our industry is growing in the shale industry. In
the chemical industry, something underreported in the USA, there have been investments of at least 185 billion U.S. dollars in the industry. So, if
they are reliance of the chemical industry and we are part of it as Sasol.
QUEST: We are very grateful, sir, that you came in to talk to us today. Thank you so much indeed. Thank you very much.
NQWABABA: Thank you.
Rex is here. President Trump says his Secretary of State, Rex Tillerson is still in the administration. That's good news for him, I suppose. As
government officials tell CNN, he could be out of a job within a few months. It's a very strange business with the Secretary of State. QUEST
[16:32:18] QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. When the man who took down Trump's Twitter
account, tells us he didn't mean to do it. And you think stock markets are going well, try bitcoin trading for an afternoon. We'll show you the
numbers. As we continue this is CNN, and on this network, the facts always come first.
The British are boiling over the U.S. President Trump's retweets of anti- Muslim videos all right probably far right British activist. The British prime minister, Theresa May, has rebuked Mr. Trump twice. He responded by
telling her to focus on terrorism, not on him. And some in parliament are also steamed calling on Ms. May to cancel the president's trip to Britain
North Korea is revealing new details on what appears to be its most powerful intercontinental ballistic missile so far. State media says the
hwasong-15 was topped with a super large heavy warhead capable of hitting the mainland U.S. Meanwhile, the United States top diplomat is calling on
China to restrain North Korea's oil supply.
Grainy video being shown on CNN of men being sold into slavery in Libya has prompted an angry outcry from the United Nations. A U.N. panel on slavery
issued a statement urging Libya to take urgent action to end slave auctions like the one shown in our exclusive reporting. The panel says the auctions
are a reminder in their words of one of the darkest chapters in human history.
And so, the big story in the markets today, the extraordinary session for U.S. stocks. The Dow gained more than 300 points. It broke through 24,000
only six weeks after doing 23,000. And it is at a record high since Donald Trump's election last year, the Dow is up 30 percent, some 6,000 points.
The U.S. President said stocks would be 50 percent lower if the Democrats had won the election.
The Dow broke 24,000. If Dems had won, the presidential election, the market would be 50 percent from these levels. Consumer confidence would be
low and glum. Anthony Chan is chief economist at Chase. I can't resist this, Anthony. It's simply an unfair question to you. But is the
president, right? Would the market be so much lower if he hadn't won?
[16:35:00] ANTHONY CHAN, CHIEF ECONOMIST, CHASE: Well, it's always difficult to try to answer those kinds of questions. My suspicion is that
is not a true statement, because the fundamentals are very good. And I would argue that the fundamentals are good because this is an economic
expansion that began even before the elections and continues to go there. The consumer confidence, business confidence. Of course, some of that is
due to the election and the fact that there are prospects for lower government regulation and things like that. But a lot of it is
fundamentals that were already starting to gel even before the elections.
QUEST: It's important to emphasize that what we have seen today with 300 on the Dow, and over the last few weeks, it is based -- Yes, a bit of tax
reform and all of that. But companies are doing well. Growth is good. Inflation is low. And unemployment is down.
CHAN: That is true and this year you'll see corporate profits not only rising in the United States, close to 10 percent, but they're rising in
Europe, they're rising in emerging markets, they're rising in Asia, Japan, China. So, it is really all over the world. Very hard to comprehend that
one election, even in a great country like ours, is having an influence all over the world.
QUEST: So, what about the dollar in all of this? Because if we do look at the U.S. currency, I mean, higher interest rates from the fed should
suggest a rise in the dollar. But, you know, at the same time, you don't want to choke off the exports.
CHAN: No, but remember that global economic growth is picking up. Right now, if you look at the eurozone, they're growing at 2. 5 percent on a
year over year basis, considering the potential growth there is only 1 percent. You're seeing good corporate growth and profits in Asia. So, to
that extent, that's helping evaluation of their currencies. Even though interest rates in the United States are rising faster than those other
areas, the fundamentals are also improving.
QUEST: But what do you see at the moment as being the natural direction for the dollar?
CHAN: I think over the near-term, we probably will see that the dollar experiences a little bit of softness. But by the end of next year, when
you see that European central bank finishing with their quantitative easing, right now they have 30 billion euros through September of next
year. And they finish with that by September of next year. I expect that the dollar will give some of that excitement up and some of this weakness
that we're seeing in the dollar could be reversed and we will see things moving the other way.
QUEST: So, to finish off, the stock market -- sometimes we use it as a barometer of how things are going. Other times we're always told, no, it's
not the ultimate barometer of what's actually happening. Do you think we are entitled to take this rising market, 24,000, as being a good barometer?
CHAN: I think that the stock market is a barometer of economic activity and the fact that over the last couple years, we saw no corporate profits.
So, to that extent I think it is important. But we've got to look at a lot of other things. We have to look at the growth in real GDP, which has been
stuck near 2 percent. And so, this has been one of the most sluggish economic recovery that we have seen in over 60 years. The good news is,
it's the third-longest economic expansion since 1900. That, I think, is impressive. And what's impressive is, we're not likely to see a recession
for another two or three years. So, there are a lot of good things to talk about.
QUEST: And the next thing we hope, of course, when you'll be back in New York and you will be the opposite table, so we can talk face-to-face.
CHAN: Pleasure here.
QUEST: The stock market is booming. You heard Anthony's analysis on the economy and the wider growth. The historic vote on tax reform could happen
this week. Certainly, it's looking more likely after Senator McCain said he would support it. So, Donald Trump is perhaps reportedly planning
another major shakeup. Government officials are telling CNN, the secretary of state, Rex Tillerson, could be replaced within the next few months.
And apparently, the White House wanted these reports to emerge to express his displeasure with Tillerson. All as the administration's tax overhaul
gets a huge boost from McCain supporting the bill. Sara Murray is in Washington. This takes Machiavelli politics. Even by Washington
standards, to new lows. That the White House wanted people to say that Tillerson would be how to teach him a lesson. Is that the gist of it?
SARAH MURRAY, CNN WHITE HOUSE CORRESPONDENT: But come on, Richard. You've seen this show in the Trump White House before. We know when the president
is unhappy with someone, he doesn't enjoy face-to-face conflict. He would rather just put it out there through his team and hope the person he wants
to see ousted ends up resigning. They're in a difficult spot with Tillerson, because he sets off a cascade of different effects.
[16:40:00] They want Mike Pompeo at the head of the CIA to become the next secretary of state possibly Tom Cotton who is right now a sitting senator
from Arkansas to move and take over the CIA. And that leaves an open Senate seat at a time when Republicans have a thin majority. So, there are
a lot of different moving parts here/ Obviously, the president not happy with the secretary of state.
QUEST: How does the secretary of state continue to do his job with a straight face when the entire world's media is reporting that basically
he's a dead man walking.
MURRAY: This has always been the challenge for Rex Tillerson, because we've seen the president break publicly with him and criticize him on a
number of occasions, and so there are foreign leaders who say, you know, we meet with meet with Rex Tillerson and talk to the state department and
we're not sure if we should believe the words coming out of his mouth or the words coming through the president over Twitter.
And so that's always been sort of a hamstring his effectiveness in the job. For Tillerson's part, he obviously wants to make this job worth his while.
He wants to stick it out for at least a year and be able to point to some accomplishments, but you can see why that is a difficult thing to do.
QUEST: Does the White House care that they basically kicked the closest ally when Donald Trump tweeted about Theresa May last night? Has it dawned
on them the damage they may have done?
MURRAY: They don't seem to be particularly sorry about it. We saw Sara Sanders today in the White House briefing room. She said, look, the
president is trying to raise awareness about threats he believes are sort of facing the United States. But I don't think that it's a surprise to see
the president breaking with a key U.S. ally. He has been unorthodox since the day he got into office, remember some of the first people he began to
aggravate when he came into the White House were the Australians, another close U.S. ally. It certainly is something first time we're seeing other
world leaders slap the president on the wrist but then say, look, he's the president of the United States, this is still someone we have to work with.
QUEST: Sara, great to have you on the program tonight. Thank you from the White House.
Forget about Dow 24k. This week bitcoin hit 11k, its crypto currency continues its rise even as most people are trying to understand exactly
what is and what it does.
QUEST: Every index has seen bull markets and bears over the years. Bitcoin swallowed both a ball and the bear in the same day. The digital
currency fell 2 percent after wild swings on Wednesday. You could tell -- just look at the graph. One-way direction. It's up 1,000 percent this
Nolan Bauerte, director of research at Coin Desk. Looking at that graph what happened this year?
NOLAN BAUERTE, DIRECTOR OF RESEARCH, COINDESK: A number of things. I think people are talking about it more and clued in really that it's a
hedge against monetary policy. That has been a really important thing. We just had a research report come out a few days ago call the state a block
chain and it showed that most people who use bitcoin see it as a hedge against monetary policy.
QUEST: How can it be a hedge against monetary policy when it experiences such volatility in its own right?
BAUERTE: Well, it's a hedge, because no one controls it, right? You have monetary policy, quantitative easing. We just had a guest on earlier that
said 30 billion dollars quantitative easing in Europe. Capital controls over in China. You've got Japan, and its addiction to quantitative easing.
And those people want to save money. And all of a sudden, their savings are being diluted. It is very easy to buy bitcoin. And it's not going to
be affected by these policies. And the other consequences that come with them.
QUEST: At the moment, what we are seeing in the bitcoin market, though, is pure speculation. Which I define as being an investment purely on the
basis that other people will follow in to push the price higher. As opposed to a company which might have better earnings.
BAUERTE: I wouldn't say that. Look at the security model it's called anti fragile. The more it's attacked, the stronger it becomes. That is a
quality of cryptography.
We're seeing the same kind of feedback loop with the value of it. The more times its criticized, the more executive action taken against it, the more
people talk about it, the more people criticize it, the more people talk about it, the more they understand.
QUEST: Right. But there is nothing underpinning it, that growth, our than what you have just said. I mean, look, I'm not suggesting if you take the
dollar, it's backed by the full Fed of the U.S. Used to be backed by gold or whatever it might be. But this is backed purely by a belief that this
is going to be good.
BAUERTE: So, you had the full faith and credit which was totally taken away in India last year when they had the de-monetization. We saw bitcoin
immediately trade at a premium in India. We're seeing it behave as a crisis currency in Venezuela, in Nigeria, in Zimbabwe. When these
countries can't get a grasp on their own monetary policy, people flood to bitcoin.
QUEST: Except when you see something go up by a thousand percent in a year. Then it becomes unruly. And the one thing you don't really one with
an investment is it to become unruly.
BAUERTE: But this is a complete paradigm shift on something that comes to cryptography an extremely powerful and potent technology that's been around
since World War II in the way we see it today. You know, it used to be only used by state actors. We had it after Turing and all those great
things they did. Then it became a business. Where you traded your mother's maiden name and your dog's name and a company did cryptography for
you. Bitcoin is the widest, most important deployment of cryptography to individuals in the history of the world.
QUEST: I think maybe I'm just cross with myself that I didn't even put 5 pounds --
BAUERTE: We all are. We all are.
QUEST: I think that's really it.
BAUERTE: We all want more we all do.
QUEST: I didn't put a penny in bitcoin.
BAUERTE: Yes. A lot of people are, I think.
QUEST: Doesn't sound like you are. Thank you very much indeed.
BAUERTE: Pleasure, Richard.
QUEST: Good to see you, sir.
I read about bitcoin in this week's newsletter. Just go to CNNmoney.com/quest to subscribe.
On the day when the U.S. market set new records, the London stock exchange has called a special shareholders' meeting to settle a nasty power
struggle. Anna Stewart is in London.
The power struggle that they're talking about. The chief executive has already said he's going, and nothing is going to bring him back. The
chairman said he is going to go, so who is going to be left in power?
ANNA STEWART, CNNMONEY PRODUCER: Well, that is a very good question, Richard. I think the chairman will hopefully stay. He's got the backing
of the board and many of the investors. But it's just very interesting that a very sudden and immediate resignation of a CEO would not draw a line
under a board in battle and it just rages on. And we now have the shareholder time set in a few weeks' time. But, you know, all of this has
been so damaging to the CEO. This has to be one of the worst CEO swan songs in history.
QUEST: So why is he going? What was this dispute About? I know that he and the chairman can barely speak to each other or, so it's reported. But
they work together before. So, who is trying to get who out?
STEWART: Well, this is a really interesting question. And we did find out a little bit more today. LSE sent out a circular notifying shareholders
there would be a meeting to vote on the chairman. And in that document, it did state that there were some operational management issues around Xavier
Rolet, and that is one of the reasons they were already looking into succession plans.
QUEST: Anna, tonight at the New York stock exchange, I imagine you have a couple pictures of it here, they're about to light the Christmas tree in
the celebrations. Look at that! There's a glorious picture of Wall Street tonight.
[16:50:00] In all its glory, the rumor, of course, whether Wall Street -- would make a run for the LSE. Will they come together?
STEWART: Well, I think the city is shuttering over that right now, Richard. It's very likely. I think ICE is the most likely suitor for the
LSE and the LSE's merger with Deutsche Boerse was perhaps a tacit agreement that it's not big enough to compete with its U.S. competitors. But the big
fear with ICE. And Xavier Rolet was very vocal about this, it's a slash and burn company. Famously brought -- split it up and sold off. And that
was Rolet's big problem with a takeover from ICE. But now the LSE is in a very different position with Brexit on the horizon. Perhaps it needs to
strengthen itself by some synergies abroad.
QUEST: Anna, great stuff, thank you. Anna Stewart watching over matters of finance in London.
A guy who likes cars and going to the gym. After the break, another feather in his cap. He shut down Donald Trump on Twitter.
QUEST: Outside the New York stock exchange, they're getting ready to light the Christmas tree. We'll show you what's happening over there. Always
such a lovely picture. Isn't that gorgeous? The Rockettes are there as well.
We may see a little bit of dancing before were finished. The man who accidentally silenced Donald Trump on Twitter, for all of 11 minutes, has
come clean. Laurie Segall has been talking to him. The headline here is he didn't mean to do it, or did he?
LAURIE SEGALL, CNNTECH SENIOR CORRESPONDENT: He says he didn't. He was also by the way not an employee he was just a contractor. Who said he was
not a rogue employee, it was not a political vendetta. He said it was an honest mistake. Take a listen.
(BEGIN VIDEO CLIP)
BAHTIYAR DUYSAK, CONTRACTOR WHO TOOK DOWN TRUMP'S TWITTER ACCOUNT: It was the last day -- it was a very hectic day, and I was tired, and sometimes
human beings do mistakes. And it was one of these days.
SEGALL: Did you realize it was Trump's Twitter account?
DUYSAK: No, I -- I didn't realize it. But also, I didn't spend any extra effort to figure out whose account it was. So, this was my mistake. Maybe
my thoughts were, like, even if it was a high-profile account, I would never believe they would come so quickly to deactivation.
SEGALL: You didn't think an action you had would have the power to take the president of the United States off Twitter.
DUYSAK: Yes. I was not aware of it, and I think that this can be clarified better by Twitter.
(END VIDEO CLIP)
SEGALL: It was interesting. He said he didn't even realize that he had taken the president off Twitter until media reports came out later and they
said it was a rogue employee. So, Twitter said they're taking security measures, they're taking this very seriously, so this doesn't happen again.
[16:55:00] But, Richard that guy you just saw him, took -- had the ability on a whim to take the president off of Twitter.
QUEST: OK. Now we know it is not deliberate. And we believe him. We have no reason not to. Then that raises a much more serious question.
Malevolence you can always get around and security if you look hard enough.
But that really is Twitter's problem, isn't it? That their systems were so bad that by accident somebody could take it off.
SEGALL: And he did not even realize it. You know, he made a decision, and he's a contractor. So, I'm assuming he's not very high up. And he said
this could happen to anyone. And what he said also in that interview which is interesting, is that even though this wasn't on purpose, he's like, this
should never have been allowed to happen. There should have been some other type of regulations to prevent that. So that is a massive issue for
QUEST: And we've heard -- you know, Twitter said it's changed its policies, it's changed its view. The stock price of Twitter just roars up
at the moment for seemingly no obvious reason.
SEGALL: Look, I think the company has a lot of complicated questions. You always point this out to me and I always like to come back with the ethics.
This company is in a position where ethically, they have a lot on their plate. Whether it's looking at bots and propaganda and influence and how
that's impacting the user base, the stock might be doing well, but these are issues that if they don't get on top of this, I think a lot of people
are going to lose confidence.
QUEST: And finally, the -- I know Snap has reformed itself in in terms of coming up with a new model. People are talking about social media. In a
few seconds we've got left, is there a feeling that Snap has more of a future than it had a few months ago?
SEGALL: I think people are a little more excited. Now that being said, you look at what's happened with Instagram. You look at Instagram stories,
how they are competing with Snapchat. I think, you know, it's an interesting race. I've covered for many, many years. And I know every
time I say something, I'm often proven wrong, so I can't give you any direct answer here tonight, Richard.
QUEST: Then join me, if you will, as we watch collectively and enjoy the last moments of the Christmas tree being lit on Wall Street. It really is
a very powerful scene for the financial world exchange. We're told they're going to light up the tree any second now. Otherwise I'll say goodbye,
whatever you're up to, I hope it's profitable.