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QUEST MEANS BUSINESS

EU Leaders Construct Safety Net for Greece; Dubai's Leaders Dig Deep for $9 Billion Bailout

Aired March 25, 2010 - 15:00:00   ET

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


RICHARD QUEST, HOST, QUEST MEANS BUSINESS: Out of the ruins, EU leaders construct a safety net for Greece.

Restoring confidence, Dubai's rulers dig deep for a $9 billion bailout.

And you can't buy a paper for a pound, these days. Well, you can if you are a Russian oligarch. I'll explain what this bought to day, because I'm Richard Quest, and yes, I mean business.

Good evening.

Europe's leaders are, tonight, a little bit closer an agreement over Greece. The agreement is that they can't solve a problem like Greece in the economy alone. Officials in Brussels have been telling reporters that the German Chancellor Angela Merkel has won her fight over how to pay for any rescue for Greece.

Critically she has convinced the French President Nicholas Sarkozy, that any aid plan for Greece should be a joint effort involving both the Euro Zone and the IMF. Now the role of the IMF had been bitterly fought against by some countries and specifically by the European Central Bank; technical assistance, yes, financial assistance, no.

So, what is the state of affairs tonight, in Brussels? Jim Boulden has been following the action at the EU summit.

Jim, have they reached a deal and an agreement?

JIM BOULDEN, CNN INT'L. FINANCIAL CORRESPONDENT: The French and the Germans, according to all reports, have come up with a framework. What they are calling the conditions for any country, like Greece, to be able to call upon them for bilateral loans, with a mix-of a hefty mix-of IMF money as well.

QUEST: And if I understand that deal correctly, the Germans want the IMF and other sources of financing to come ahead of any Euro Zone or EU money.

BOULDEN: And they-you know, the IMF is a mechanism. It is already there. It already knows how to do this. It already has all the technical details down, so it is very easy for a country to go to the IMF. It has been the political resistance to allow them to do that. So, this seems to be breaking that log jam to allow the IMF to do this. But with the Euro Zone taking the lead, and this is one thing I read about. That there would be a trigger that it would-that only the Euro Zone could make this. So, Berlin would have a veto over all of this. They still want to have control over how Greece goes ahead to do this.

QUEST: They want it to be a very last resort before-and now, the point about this whole deal is, though, it is-they come to this agreement and they do ratify it, this won't be a Greece specific arrangement, will it?

BOULDEN: Well, you can't just say Greece can do it, but Portugal can't. So they would have to come up with a hefty amount of money. Goldman Sachs says something like $20 billion euros would have to come from the IMF, alone. And the reason why that is somewhat worrisome to some in Europe is because that money is controlled by the IMF and a big influence of the U.S. So, they have all that mixed in there, as well.

QUEST: And what about changing the rules, because there is some question-I hate to say this but there is some suggestion tonight that they might have to re-open the Lisbon Treaty.

BOULDEN: You and I know that ain't going to happen.

(LAUGHTER)

According to one report I saw today, that friends of Greece are talking about something called the European government of the EU. The EU council, which is the heads, the leaders, would agree to a tighter European monetary union, a tighter control of the European Union economy. And that this would be the new-the next step and inside of that, countries like Greece could get help.

QUEST: Talk euro to me, Jim.

BOULDEN: OK, well, we know that the euro last week was at $1.38. Let's show you where it was today, so-

QUEST: $1.38 to the?

BOULDEN: To the dollar.

QUEST: Right.

BOULDEN: We thought that the euro would get stronger, didn't we? We thought the euro might bounce on this and last we looked, you see there, below $1.33. That is just, just off a 10-month high. So it has come up a little bit in the last few hours. But we are talking about a euro that has been weakening greatly since then, because really, people keep waiting for something to happen with Greece. You remember earlier today Greek Prime Minister Papandreou was in Brussels, and he said, the talked to reporters again, talking about this entire mess.

(BEGIN VIDEO CLIP)

GEORGE PAPANDREOU, PRIME MINISTER, GREECE: Greece is on the right track. We will continue to do our work and make sure that our economy is a viable one, a just one, a transparent one, a prosperous one. Let me also thank so many leaders that have supported us in this difficult time. And particularly supported the measures which in fact, are working. We are on a very good track in cutting down our deficit this year. And I think this shows a very positive trend for the Greek economy.

Now, obviously, today the challenge is an important one to strengthen and fortify the Euro Zone, to take the necessary steps so that we do stabilize the euro and move forward to a more prosperous Europe.

(END VIDEO CLIP)

BOULDEN: So, what we are hearing also is that the Euro Zone countries may get together tonight late, late, tonight, to have their own little meeting, the 16, to talk more about this. And then tomorrow we still have the summit, goes to about lunch time. So, we may have to wait `til tomorrow `til we actually get some firm language on this.

QUEST: All right. Jim, you'll keep watching this please.

BOULDEN: Yes.

QUEST: Let us know what happens. Jim Boulden, who will be watching the Greece situation.

Now the one result of this perspective agreement is that stock markets breathes a little easier on the signs of progress for Greek debt crisis. At the same time as another one moved closer to resolution, also in Dubai. That also took the steam out of the market. As a result it lifted European stock markets, and most of them have clocked up three gains in a row.

When I say, took the steam out of the market, of course, I meant the pressure. The steam out-you'll see, over here. Join me in the library, if you will. You will see the markets show quite nice gains overall. The London FTSE is now at its highest level since June of 2008.

HBC was up by 3 percent, RBS was up 3.5 percent. Thomas Cooke, interestingly, Thomas Cooke, had shown a rather good move overall, because summer bookings are sharply higher. British Airways up 3 percent, that is because they look at the moment as if they've got the better side of the strike. But, of course, there is another strike starting this weekend.

The Xetra DAX, over here, is up 1.5 percent. It is the highest level since September of '08. Deutsche Bank gained 3 percent. In fact, all the banks were up in Germany, which was a strong performance. Not only was BA up in London, but Lufthansa was up nearly 3 percent after the chairman of Lufthansa told the newspaper that demand was rising. Major steel makers, ThyssenKrupp and Salzgitter, also up 2 percent on the back of rising metal prices.

You'd be very surprised if those markets weren't up in Paris, have bucked the trend-and they didn't. And this is perhaps, maybe, where we should have started because Paris is over 4,000 points. It was Renault that gained 5 percent, with its potential alliance with Daimler. Renault and Daimler are sorting out those valuation differences that has been troublesome so far.

That is the way the markets in Europe are trading. We need to look at the Dow Jones industrials and how the market there is trading. Up 81 points. Fascinating, because look at the Dow. We've got quite close now to 11,000 on the market. Some people are suggesting that it has broken out of that range that you and I have seen it in, over many weeks, of 10,700, 10,750. Now we are heading towards 11,000.

Anyway, let's turn to the news headlines and bring you up to date with what is happening. Fionnuala Sweeney at the CNN News Desk.

(NEWSBREAK)

QUEST: The ex-spy who became a newspaper baron, there is a new owner for the British newspaper, "The Independent". We're going to be talking to the paper's editor-in-chief about what he expects from his new boss, in just a moment. Good evening.

(COMMERCIAL BREAK)

QUEST: A Russian oligarch is buying Britain's "Independent" newspaper, and not just any Russian oligarch. He's also a former KGB agent. Alexander Lebedev paid just 1 pound for the whole operation. Now that is about $1.50, 55, which incidentally is the paper's cover price at the newsstand.

Mr. Lebedev seems to be building a British press portfolio. He already owns the paper that most Londoners read in the evening. This is the "London Evening Standard". Guess what he paid for the "Evening Standard"? Yep, 1 pound.

Let's take a closer look at Mr. Lebedev. In his days in the KGB, the Russian security service, he was based here in London. One of his jobs then was to scour the British press for secrets and that is when he says he developed his love of the industry.

Mr. Lebedev made his fortune in banking. He controls Russia's National Reserve Bank. And he selling a 25 percent stake in Aeroflot, the national airline. He has a reputation as a critic of Vladimir Putin, Russia's prime minister. And since he's bought the "Standard" he's turned it into a free sheet, circulation has gone up, and that is the key to drawing in advertising revenue.

The managing editor and editor-in-chief of the independent is Simon Kelner. Simon joins me now, on the line.

Good evening. Firstly, congratulations on the sale the paper, but Simon, I'm wondering, what do you think Mr. Lebedev is going to do with it. Bearing in mind the paper is losing money, has been losing money, and needs to be turned around.

SIMON KELNER, EDITOR-IN-CHIEF, "THE INDEPENDENT": Well, I think it is a bit too early to say what exactly he's going to do. I mean, everyone has been focused on doing the deal. And I think the hard work starts now in terms of finding a business model that works for the paper. But clearly, he's not bought the paper to make a quick profit, but also he hasn't bought the paper to loose money into a black hole. So, we'll be working very hard on various different business models.

QUEST: Right.

KELNER: And in time, we'll find a way forward.

QUEST: If Mr. Lebedev came up to you and said, Simon, I want to turn the "Inde" into a free sheet, we are going to give it away, in the mornings. What would you say?

KELNER: Well, I think the term free sheet is a little pejorative. I mean, if he said to me, what I want to do is keep the quality of "The Independent" exactly as it is. And I want to have a model of free distribution to ensure the very fine journalism in "The Independent" reaches many more people than it does at the moment. I would be pretty supportive of that.

QUEST: What about this idea of a Russian oligarch owning one of Britain's major-now two or three of the country's major newspapers. Not unique by any means, in that sense. Do you have any fears that your new owner might actually be-be an interfering busybody in the paper?

KELNER: Well, I think his record, so far, speaks for itself. Which is he owns a paper in Russia, called, "Novae Gazette" (ph), which is one of the very few free-free in terms of not state controlled newspapers in Russia.

QUEST: Right.

KELNER: And has supported investigative journalism often at great personal risk. And the "Evening Standard" in London, which you know, rarely has there been a newspaper of such standing as the "Evening Standard" that has had so little interference from its proprietor.

And you know, he's very respectful of the traditions of "The Independent". The primacy of our journalism and I don't think he'd buy "The Independent" and not keep it independent.

QUEST: Finally, Simon, we are about to have an election in the U.K., and are you looking forward to it?

KELNER: Oh, very much. Who wouldn't be looking forward to it? I mean, it is a really exciting election, we've got the prospects and the possibility-although fading a little bit-a change of government for the first time for 13 years. Now I think it is going to be a very exciting election and the role for a newspaper like "The Independent", which is the only newspaper in its market that free of proprietorial influence and political bias. The role for a paper like ours is very clear indeed.

QUEST: Simon, many thanks, indeed. Please come back and bring us up to date every now and again, on how the change over is going. Many thanks, Simon, of "The Independent".

Now, a massive cash injection, for the company that built much of Dubai. With billions of dollars of loans still outstanding, well, Dubai World has bought some time. We'll look at what it means for the whole Gulf region, in just a moment.

(COMMERCIAL BREAK)

QUEST: The rulers of Dubai are throwing a cash lifeline to Dubai World, the company whose debt crisis shocked the markets last year. They are saying everyone who is owed money will get repaid in full. Now that is a massive turn around from what they were saying last year, when the property and investment company admitted it was too weak to keep up debt payments.

Then the government said it was a commercial entity and those investors might just have to take their losses. As Leone Lakhani now reports, the government is finally grasping the nettle.

(BEGIN VIDEOTAPE)

LEONE LAKHANI, CNN INT'L. CORRESPONDENT (voice over): After months of negotiations the process has begun. Debt-ridden Dubai World and its subsidiary, Nakheel. will get a $9.5-billion cash injection from the Dubai government.

(On camera): The funding from Thursday's restructure plan will come from a previous loan from Abu Dhabi, as well as internal resources from the Dubai government. In other words, there is no additional federal support needed, at least this time around.

(Voice over): Macroeconomic conditions going forward may require further support. But for now, Dubai seems to be getting its own house in order. The new cash injection will allow debts to better reflect the value of the assets. And that has lead to optimism in the markets.

SAUD MASUD, HEAD OF REAEARCH, UBS: Investors were expecting an inline to better deal announcement, we got it. And now going forward is the big question mark and how far this momentum carries through.

LAKHANI: Dubai's benchmark index is up more than 10 percent for the month. But analysts say Dubai's debt repayment schedule over the next two years is pretty intensive. And there is still concern about the emirate's overall debt levels.

FAHD IQBAL, VICE PRESIDENT, EFG-HERMES RESEARCH: Our estimates of Dubai Inc.'s debt, overall, and by that I mean, the sovereign government along with the government-related entities total to roughly $96 billion. So even aside from the debt that is being restructured there is certainly some way, some more debt that needs to be addressed.

LAKHANI: There is still some $14.2 billion of debt linked to Dubai World that is being renegotiated. And Dubai officials say it may take up to eight years to pay off the full amount. That buys Dubai some time to service that debt.

IQBAL: I think they will be successful in refinancing and restructuring some debts. I think they will be able to raise cash by selling off some non-core assets.

LAKHANI: The challenge now is to restore investor confidence. Thursday's announcement fends off financial fallout and brings some much needed clarity. The latest chapter is Dubai remodels a new framework for doing business. Leone Lakhani, CNN, Abu Dhabi.

(END VIDEOTAPE)

QUEST: So, the offer that Dubai has made is something like this. Stay with us and you'll get your money back. As long as you are prepared to be patient. It is a bit of "Hobson's Choice" really. Some vendors will get repaid on time, others are being asked to sit tight for up to eight years. And now to analyze exactly what it means we brought in John Defterios from CNN's "MARKETPLACE MIDDLE EAST" to get a closer look. And I asked him, whether this is in any shape, in any form, a simple utter bailout?

(BEGIN VIDEOTAPE)

JOHN DEFTERIOS, CNN ANCHOR, MARKETPLACE MIDDLE EAST: Yes, this is a bailout. You remember they-at the end of November they said, well, don't expect the government to step in, because these are private companies. Well, wipe that out of your memory banks, because this is government intervention to the tune of about $9.5 billion. So, taking the debt into equity now, for the Dubai government, and $8 billion of cash for Nakheel, the property arm.

QUEST: So, not only did they say first time around, these are private companies, and then Abu Dhabi came in and they gave them money. This is the second time money is being provided.

DEFTERIOS: No, in fact, but they are not going back to Abu Dhabi, another time. They took $5.7 billion out of the reserve fund that they had, from that money from Abu Dhabi, and they said they had some money in reserve to be able to work this through. The number is a little bit lower, because I didn't include, Limitless (ph), which is another property arm of Dubai World. They don't need the bailout, so that figure was not $26, but $23.5.

QUEST: Is this a done deal in the sense that there is no more money that has to be provided? Or is there more roll over of debt? And ultimately more losses to be sustained?

DEFTERIOS: Well, I'm glad you brought that question up, because right now, this is the first tranche, if you will, of the debt that needs to be restructured; needed to be done by the end of the month. They are a week ahead of the deadline and that is done to rebuild confidence in the markets after burning investors and surprising them at the end of November.

But remember that there is more debt coming up in May, by mid-May. Another tranche in June and then throughout the second half of the year, there is more debt to be rolled over and restructured.

QUEST: So the two options here are either rolling over and the market eats it.

DEFTERIOS: Hmmm.

QUEST: Or the government buys it.

DEFTERIOS: And the fact that they put cash up, actually, is going to boost up that debt a little bit and that is why the market in Dubai responded very well, although it was not a pan-regional stock market rally today, which I thought was interesting. It was a great euphoria throughout the Middle East.

QUEST: Am I being unfair when I say-

DEFTERIOS: You? Never.

(LAUGHTER)

QUEST: Well-I-when I say it is a mess, and it still looks like a mess?

DEFTERIOS: No. I think that could be unfair. They are approaching this on a much more professional manner. They had a head of the debt restructuring committee, Aiden Burkett, who came from Deloitte. Sheik Ahmed, who runs the Emirates Airlines, took a very methodical approach. Didn't talk a lot to the markets, but did plod his way through the first big level. One banker I know that has been involved very closely in the discussions and the language that was released, told me today the big, big test is, number one, do the creditors like this? Number two, did they rebuild confidence after surprising people at the end of November. And we don't know that just yet. And we haven't heard from the creditors.

QUEST: That is going to be the test.

DEFTERIOS: That is the big test.

QUEST: Whether or not they've rebuilt. So, many thanks indeed, John Defterios.

(END VIDEOTAPE)

QUEST: John Defterios, on the issue relating to Dubai. Stocks there, got quite a lift there after the debt work out proposal. The main index closed up more than 4 percent. Emaar Properties was a major developer there. That was the biggest gain. Its shares surged over 8 percent. This really was a classic case of the rising tide lifting all boats.

Let's just pause for one second to remind you how you can get a hold of us on this program. Besides the Twitter address, @RichardQuest, you can always find us on Facebook. Now, our Facebook page, which has all the gossip that you will ever want to know about the program, who is doing what to whom, where, when and why? Who is paying for it? Who had the muffins and who actually didn't? Our Facebook address is QuestMeansBusiness. QuestMeansBusiness is where you'll find us. And of course our e-mail address is (INAUDIBLE).

Now, when we come back in just a moment, facing the cold hard facts. U.S. Treasury Secretary Tim Geithner talks to CNN about rising unemployment. When the American economy will start creating jobs.

(COMMERCIAL BREAK)

QUEST: Good evening. I'm Richard Quest, QUEST MEANS BUSINESS, this is CNN.

Now the U.S. Treasury secretary has told CNN that the worst may now have past for jobs seekers in the United States. Tim Geithner gave his take on the U.S. labor market when he spoke to our John King. And he also stressed that financial reform remains a top priority for the Obama administration.

(BEGIN VIDEOTAPE)

TIMOTHY GEITHNER, U.S. TREASURY SECRETARY: We're close to the point where the economy is going to start creating jobs, but this recession caused a huge amount of damage and we're going to living with that damage for a while to come. But there is a little more hope now.

JONN KING, CNN ANCHOR, JOHN KING USA: Another question we get, when we ask people what are their thoughts on the economy, is why has nothing been done on the issue of financial reform? Why today, could it happen again?

GEITHNER: Two key tests, for reform, are we giving consumers and investors basic protections against abuse and predation? You know our system has done a terrible job of providing basic protections. And the damage caused was hugely damaging just to the average investor, the average family, the average business. And they are still suffering from those basic mistakes.

The other key test is to preventing this thing from happening again is to make sure we deal with "too big to fail". We are constraining risk- taking for the major institutions. And if they mess up in the future the choice for them is not to survive, with government help at the expense of the taxpayers. The choice for them is to be wound down, broken up, sold off over time, at less cost to the economy.

You've got to do those two things, though. Each-one is not enough.

KING: Two key tests, for reform, are we giving consumers and investors basic protections against abuse and predation? You know our system has done a terrible job of providing basic protections. And the damage caused was hugely damaging just to the average investor, the average family, the average business. And they are still suffering from those basic mistakes.

The other key test is to preventing this thing from happening again is to make sure we deal with "too big to fail". We are constraining risk- taking for the major institutions. And if they mess up in the future the choice for them is not to survive, with government help at the expense of the taxpayers. The choice for them is to be wound down, broken up, sold off over time, at less cost to the economy.

You've got to do those two things, though. Each-one is not enough.

KING: They're a little bit more concerned about how hard it is to operate in China, on a level playing field.

And I think that is one reason why the president is going to be working so hard to make sure that we get better access for U.S. goods in China and we are seeing a fairer rules-of-the-game there.

KING: And how hard is that part? It is a very, very different culture.

GEITHNER: Well, they get a lot of political pressure, too, in China. People don't realize that. We have a lot of people in China, like you hear here sometimes, saying, you know, we want China for China--China for Chinese producers. But I think if you listen carefully to what the Chinese have been saying, even just last week or so, they are very sensitive to the concerns of not playing fairly.

KING: Early this morning, Senator Lamar Alexander, Republican of Tennessee, is on the floor and he was talking about health care and the student loan program. And he offered a pretty stinging rebuke of his view of how the Obama administration views government. Let's listen.

(BEGIN VIDEO CLIP)

LAMAR ALEXANDER, (R) TENNESSEE: Sometimes I think, Mr. President, that the motto of the Obama administration is, if you can find it in the Yellow Pages, the government ought to be doing it. I mean, this is really breathtaking. Why we are taking over cars, banks, insurance companies, why we're taking over more of health care, we'll just also take over the student loan programs.

(END VIDEOTAPE)

KING: Does he have a point?

GEITHNER: I don't think so. I obviously respect the senator very much. President Bush was the one who lent billions of dollars of the taxpayers money to the automobile industry. It was the right thing to do. He was the one who put $230 billion into banks representing three quarters of our entire banking system.

When this president came in, we went to move very quickly to get that money back from the banks. We've got a $170 billion of that back, almost all from the major banks, at a positive return to the taxpayer. So, we have worked very, very quickly to clean up the mess we inherited, and get the government out from the emergency actions that President Bush started to take to-to deal with this recession.

KING: Let me close by asking you what you have learned about yourself and the politics of this town, in a very rough 14 months for you. You came into office under some controversy, you go off to Capital Hill, there are Republicans who have called for your resignation.

GEITHNER: Democrats, too.

KING: Democrats, too. OK, I'll be fair about that.

(LAUGHTER)

KING: We Googled your name this morning just for kicks. And you can look at the screen up there and you see your Wikipedia file first and then the next line is, "Geithner Resign," Geithner-AIG."

That can't feel good.

GEITHNER: Well, I learned this a long time ago. I learned that when you're in government -- and I've been in public service all my life, John - - you've got to worry about just one thing, which is make sure you're doing the right thing. It may be unpopular, it may be difficult, it may be controversial, but we're here and we're going to be held accountable for what we do to make things better.

KING: Can I read into that that those calling for your resignation are going to have to wait a while?

GEITHNER: Now, that's a...

(LAUGHTER)

GEITHNER: -- a (INAUDIBLE)...

KING: You're not going anywhere?

GEITHNER: That's a...

KING: Are you going anywhere?

GEITHNER: That's a question for the president. But, again, I wake up everyday just trying to figure out how we can fix what was broken and how we can get out of the mess we inherited. And we're making a lot of progress.

(END VIDEO TAPE)

QUEST: We're listening to, at length, the U.S. Treasury secretary, Tim Geithner, talking to CNN's John King.

Now, other public servants who have been talking, which is an understatement, the chairman of the Fed, Ben Bernanke, who says the U.S. still needs low interest rates. Mr. Bernanke told lawmakers on Capitol Hill his view that it's too soon to start tightening monetary policy. And that hasn't changed. But he's assured them he's ready to change tack when the time is right.

(BEGIN VIDEO CLIP)

BEN BERNANKE, FEDERAL RESERVE CHAIRMAN: At its meeting last week, the FOMC maintained its target range for the federal funds rate at 0 to .25 percent and indicated that it continues to anticipate that economic conditions, including low rates of restructure utilization, subdued inflation trends and stable inflation expectations, are likely to warrant exceptionally low levels to the federal funds rate for an extended period.

In due course, however, as the expansion matures, the Federal Reserve will need to begin to tighten monetary conditions to prevent the development of inflationary pressures.

The Federal Reserve has a number of tools that will enable it to firm the stance of policy at the appropriate time.

(END VIDEO CLIP)

QUEST: So, there, of course, we heard the crucial sentence, exceptionally low rates for an extended period of time. It's when we hear that phrase disappear that we know we might be in trouble.

Let's get some reaction from New York to what the markets.

Let's bring in Felicia Taylor, who joins me from the New York Stock Exchange.

We'll get to why the market -- well, the market is having a -- a rollicking good session today. You're up over 100, give or take.

How much of this can we put down to Mr. Bernanke?

FELICIA TAYLOR, CNN CORRESPONDENT: Quite a bit of it. You know that when Bernanke speaks, Wall Street listens. Stocks rallied right out of the gate this morning, but they really did pick up steam after the chairman began speaking.

As you said, you know, Wall Street doesn't like surprises. The Fed chief, thank goodness, didn't offer any, saying that interest rates would remain low, but that they're prepared to change that stance when needed in order to stave off inflation.

Bernanke also talked about pulling back on some of the stimulus measures that we've -- that we put into place at the height of the recession. That's actually a good sign. It means things are improving...

QUEST: Right.

TAYLOR: -- albeit slowly. And certainly we're not out of the woods yet.

But that was enough good news to prop up the financial sector, pretty much right across the board. Bank of America, Citigroup, Goldman Sachs, JP Morgan -- they're all up between 2 and 4 percent right now. So that's also been fueling the rally.

And we've got that better than expected drop in weekly jobless claims, a good earnings report from America's largest electronics retailer, Best Buy. That topped expectations. And -- and you talked about this at the top of the show -- news out of the European Union that it's going to shore up the Greek debt problem.

All of it a sigh of relief for the marketplace -- Richard.

QUEST: All right. Let me just delve, if we may, because you can obviously see it from your screen, the NASDAQ Composite and -- and, if you like, the broader market indices, because even if the -- even if the Dow, maybe even the S&P is showing strongly, what about something that's a little more exotic?

(LAUGHTER)

TAYLOR: What do you mean, a little more exotic?

QUEST: Well, you know, tech...

(LAUGHTER)

TAYLOR: What are you referring to?

QUEST: -- tech stocks, for instance and -- and the broader market -- how -- how they are performing today.

TAYLOR: Actually, it's pretty much across the board that there's been some consistent strength, interestingly enough. And, you know, the -- the question that I have, though, is what's really driving this kind of momentum?

We've got a key measure of retailers' health, which is known as same store sales. They've been higher for the latest two months. That's got traders believing that this employment picture is going to continue to strengthen. If people are shopping...

QUEST: Right, but...

TAYLOR: -- obviously, they've got money to spend, that means that they've found jobs.

QUEST: Hang on a second, though.

TAYLOR: Yes?

QUEST: By today's numbers that we're seeing in the Dow, I...

TAYLOR: Yes?

QUEST: -- we look like we've broken out of the range that we've been stuck in for the last, say, I'd say three to four weeks, anywhere between 10600 and 10750. Now, once we go over 10900, 10950 and -- I mean I'm not a chartist. I've never really believe in the chartist theory, that because you hit a particular point, you're going to roar on ahead. I'm sure some viewers will take exception to me for that.

But 11000 is now highly desirable.

TAYLOR: Well, you know, and this is what's kind of interesting. I spoke to a trader earlier today and he explained it this way, that the United States, the U.S. markets have become somewhat of a default. OK, so you had a financial crisis in Greece and now Portugal. People haven't been putting money in Europe. They're not putting it in Japan, that's for certain. OK, granted, they may be getting an aid package in -- in Greece, but that's not 100 percent sure.

As you were talking with Jim, if you take a look at the currency, the dollar is continuing to strengthen today, not the euro.

Also, we've had a health care bill signed here, so there was no sell- off on that. And you know the old adage, Richard, you can't fight the tape. Anyone who did fight the tape recently was betting that the market would tank. They looked foolish, frankly.

Short sellers have basically thrown in the towel and now they're buyers. The momentum wants to see the Dow cross 11000.

And you know what?

It could very well happen in the next few sessions.

QUEST: Well, there we are. And that put me in me place.

Felicia Taylor, many thanks.

(LAUGHTER)

QUEST: Many thanks, indeed.

See you tomorrow.

What can one say after that?

When we come back in just a moment, we've been to the market, which some have always accused it as being a bit of gambling. But when we return in just a second, a World At Work where we go to the real world of the casino, in a moment.

(COMMERCIAL BREAK)

QUEST: Now, graduating from casino to campus, CNN caught up with a blackjack dealer who says her job is all part of furthering her education. It's an interesting way to get an education. When it comes to gambling in Macau, Eunice Yoon found out a fascinating World At Work.

(BEGIN VIDEOTAPE)

EUNICE YOON, CNN CORRESPONDENT (voice-over): For Milk Choi, arriving at the office means stepping into the world's largest casino. She works at The Venetian Macau dealing baccarat, craps, blackjack or roulette.

"I'd never thought of working as a dealer when I was small," she tells me. "Actually, I wanted to be a policewoman, but my physique is not very good."

Here, Choi maintains law and order in a different way. She keeps an eye on everything that happens on the gaming table. Choi's been dealing for five years and is patient with those of us learning baccarat for the first time.

MILK CHOI, CASINO DEALER (through translator): Two caps or maybe two caps on the diamond.

YOON (on camera): OK.

CHOI: There, you won.

YOON: Yes!

CHOI: That's good.

YOON: Oh.

(voice-over): The rules of the game are now second nature to Choi, though it wasn't that way in the beginning. "I wasn't that familiar with the chips," she tells me. "I wasn't sure how much each color was worth."

Eight hours a day on the overnight shift has taught her to calculate those chips fast. "I feel very tired after work," she says, "because I need to stay standing for eight hours and I get eye circles."

Yet Choi prefers burning the midnight oil because it leaves her days free to prepare for her college education, though sometimes the players can get a little sensitive. The Venetian would not allow CNN to film gamblers at the tables.

If players get out of control, Choi says, she calls for backup -- her manager. "I tell myself to stay calm," she says, "because I'm the one who's responsible for taking care of the gaming table."

Too bad she's not responsible for my bet.

(on camera): Lucky 7,000. 7,000 Hong Kong.

CHOI: (INAUDIBLE)

YOON: Oh.

Just to tears so quickly.

(voice-over): Eunice Yoon, CNN, Macau.

(END VIDEO TAPE)

QUEST: Oh, I -- I'd love to see how Eunice is going to get that passed on her expenses. Gambling. Oh, dear. They'll probably find out and they'll be having to reimburse her for the cost since it was a World At Work. I'm quite partial to the old roulette wheel myself every now and again.

Now, the weather is warming up for many. It's cooling down for others. Which, of course, is a polite way of saying we're up a bit, we're down a bit, we're round a bit.

Guillermo is at the World Weather Center to make sense of that nonsense.

GUILLERMO ARDUINO, CNN METEOROLOGIST: Yes, but you know what?

Some are going through a headache, especially in Belarus. We have floods. This year, Richard, the winter was so cruel in so many countries in the Northern Hemisphere, we got so much snow, we've beaten records. That now all that snow, when temps go up -- and that's what's happening here right now -- then that snow becomes water and it floods many countries.

And we started with Belarus in here. But many more to come. So our eyes are set on that for the next weeks.

Also in the United States, the same thing.

Now, see that jet?

This is responsible for the storms that you saw in Britain and now that jet is going to move away. The rain will continue. There's going to be a little bit of a break. But the temperatures are cooling down. And these are the areas where the temperatures are going down, while in other sections, the temperatures keep going up and we have the threat of flooding.

Of course, I was checking out exactly where it was raining. And I have to say that we don't see significant delays. But we will see winds in Spain, in Portugal, France and in Britain. So rain and Dusseldorf right now. In Cardiff, in Plymouth. But you see, these airports here in Central Europe are going to be OK, because there is not much weather affecting them.

The delays are going to come in these areas -- anywhere into France; also, Northern Portugal, here from Vienna, Docastelo (ph), Braganporta (ph) all the way down into Algaves (ph), where we have high seas and also winds. Therefore, we'll see some delays in Madrid. The delays are not excessive right now, even though I was checking and there are some posted, also, in Italy, in the Rome area. But they're not excessive at all.

And in the States, it also continues to be OK. We will see some scattered showers. We will see, also, problems with the winds in Arcorunia (ph) all the way into Cantabria. We are going to see now more rain. It's actually raining in Manchester right now, in Gupto (ph) and in Biariz (ph) here in parts of France.

But let's see, these are the airports that are posting problems for tomorrow -- Paris, London, Amsterdam, Brussels, also.

And you know what?

You're going to see here, especially, that you are going to get a little bit of a break in two days or so in England. Temp[s are going down, but mainly the effect in the northwest and the southwest because of the winds. But they will continue to stay at double digits. In the case of the high, 17 in Athens; also, we have some rain showers in Athens as we speak.

The snow actually improved the quality of the air in many areas of Northern China and in Japan. And this cyclone that you see over here, it's going to dissipate. So the snow showers ended in Beijing. That is responsible for the clearing of the conditions. The air quality is improving. High pressure is taking over right now. We have some delays, though, into Tokyo. Hong Kong, also, with the winds, and Taipei.

So those sections of Asia are going to continue to see some bad weather and the weekend, though, this storm is good news here in the Philippine Sea -- Richard, back to you.

QUEST: Many thanks, Guillermo.

ARDUINO: All right.

QUEST: It won't stop us -- well, I'll tell you, every time I've walked out the door today and yesterday, it just managed to rain on me head. Hopefully, the weekend will cheer.

ARDUINO: Two days.

QUEST: But I'll be putting him to the test in...

ARDUINO: Two days.

QUEST: -- today.

ARDUINO: Two days.

QUEST: Oh, in two days.

ARDUINO: Yes.

QUEST: In two days.

What, in two days it clears up...

ARDUINO: It clears...

QUEST: -- or in two days...

ARDUINO: It clears out a little bit, yes.

QUEST: Fine. Well, all right. I realize our conversation has got no relevance or interest to others, but never mind. It's my weekend I'm concerned about.

When we come back in just a moment, gold prices are holding above $1,000 an ounce. Plenty of people want to convert their treasure into cash. Some customers say it's a golden opportunity to be fleeced. There's two sides to this coin, in a moment.

(COMMERCIAL BREAK)

QUEST: From Viagra to vintage cars in Cuba, we're used to seeing those old American-made cars on the streets of Cuba. But it turns out it's the license plates that make more of a distinct statement, as Shasta Darlington explains from Havana.

(BEGIN VIDEOTAPE)

SHASTA DARLINGTON, CNN CORRESPONDENT (voice-over): Dented and noisy, 1950s Chevys and Fords rumble down Havana's potholed streets. For most visitors, Cuba simply wouldn't be Cuba without them.

UNIDENTIFIED MALE: I really enjoyed seeing them because it reminds me of my cars from my childhood.

UNIDENTIFIED MALE: I -- I wonder how they can keep them going for so long, but the show that I did see, I know they couldn't get parts and they to make their own parts. It's simply amazing, you know?

DARLINGTON: But for Cubans themselves, it's not so much the car you drive that matters, but the license plate on your front fender. That's because the colors, letters and numbers tell the world who you are, as well as providing an easy way for officials to keep tabs on people and their vehicles.

(on camera): A blue license plate means the car is at the service of the state. So these workers here can pull them over and oblige them to take passengers when transport is scarce.

UNIDENTIFIED MALE (through translator): It doesn't cost anything. I do it every day to get to work.

DARLINGTON (voice-over): The government owns most cars in Cuba. Foreign diplomats drive sleek cars with black plates. The numbers tell you which embassy they're from and even their rank. Number one is the ambassador.

(on camera): All other foreigners -- businessmen, church leaders and, of course, journalists, have orange plates. The numbers and letters tell you even more about the driver, which makes it hard to keep a low profile when you're covering a story.

(voice-over): Executives at state-run businesses get brown plates. The military drives vehicles with mint green or olive green plates.

(on camera): Most of these eye-catching Fords and Chevrolets have yellow plates. That means they're privately owned and their owners often turn them into collective taxis, squeezing five, six, even seven people in and charging about 50 cents per person.

(voice-over): Some of the better maintained antiques, like this hot pink 1955 Oldsmobile, have blue plates. That's because they're owned by the state. And the state rents them out to tourists. But they pay $30 for the pleasure.

From back here, it doesn't matter what kind of license plate you have, it's all about the ride.

Shasta Darlington, CNN, Havana.

(END VIDEO TAPE)

QUEST: Now, gold is still biting investors and other consumers, who simply love the idea of making money out of the stuff. Futures ticked higher on Thursday, around $6 an ounce. The current market price for an ounce of precious gold is around $1,091. It's 16 percent higher than this time last year.

It may be off its tops of recent months, but mix that escalating price with tough economic times and you get, of course, people looking to swap their gold trinkets for cash. It's a scenario that's turned into a court case against one company.

Poppy Harlow has been explaining more.

(BEGIN VIDEOTAPE)

(BEGIN VIDEO CLIP FROM CASH4GOLD COMMERCIAL)

UNIDENTIFIED MALE: I'll give you cash for this gold medallion and me wearing a gold medallion.

(END VIDEO CLIP)

POPPY HARLOW, ANCHOR, CNNMONEY.COM (voice-over): Their ads are pervasive, but some cash for gold customers say they're getting a raw deal.

FRANK POINDEXTER, CASH4GOLD CUSTOMER: They slap you in the face with an absurd amount.

REP. ANTHONY WEINER (D), NEW YORK: A golden opportunity to be fleeced.

HARLOW: (on camera): You know, there are just a lot of people that are selling their gold right now. And there are some people that say they're getting ripped off. There's actually a class action lawsuit against Cash4Gold right now. And they invited us down to their headquarters here in Florida. So we came.

And we can't show you the outside of the building for security reasons, but we really wanted to come in and see exactly what was going on.

UNIDENTIFIED FEMALE: I'll make sure that everything here is what I received.

HARLOW: (voice-over): The gold is tested.

UNIDENTIFIED FEMALE: We just simply just scratch lightly.

HARLOW: Appraised.

UNIDENTIFIED MALE: We add it up.

HARLOW: An offer is made and customers have 12 days to decide whether or not to accept it.

UNIDENTIFIED MALE: And we'll get about 1,800 degrees for this...

HARLOW: If they do, their gold is melted down.

UNIDENTIFIED MALE: We melt constantly.

HARLOW: But "Consumer Reports" finds mail-in companies, including Cash4Gold, sometimes pay out as little as 11 percent of the gold's value.

(on camera): I think some concerns are -- whether they're valid or not -- that maybe more gold is getting processed here than someone sent in than they're getting paid for.

JEFF ARONSON, CEO, CASH4GOLD: I know exactly what comes in is weighed up. It is -- a value is assigned to it right from the computer. My people don't make more money off of it.

HARLOW: (voice-over): Cash4Gold says it pays 20 to 80 percent of the gold's value.

But that's not what Frank Poindexter claims he got.

POINDEXTER: About a week-and-a-half, I think, after I sent the package off to them with the gold in it, I received a check.

HARLOW: (on camera): How much for?

How much was the check for?

POINDEXTER: I was astounded. It was for $.15.

HARLOW: $.15?

POINDEXTER: $.15.

HARLOW: (voice-over): $.15 for what he says was more than a dozen pieces of gold appraised at roughly $200.

But Cash4Gold's internal documentation says just this single gold earring was in Frank's packet.

(on camera): Are you saying he lied to you?

ARONSON: I'm just telling you the facts.

HARLOW: (voice-over): In the end, Cash4Gold settled with Frank for $150.

(on camera): And, you know, Frank Poindexter is not alone. He's joining that lawsuit against Cash4Gold, which alleges, amount other things, that the company sometimes melts down the gold before the 12 day return period has ended and sometimes blames the post office for losing items in the mail.

ARONSON: The class action is -- is merit-less. There were three main complainants on the class action suit -- three.

HARLOW: (voice-over): After numerous complaints about several companies, New York Democrat Anthony Weiner introduced The Gold Act, pushing for more stringent regulation of the industry on a national scale. WEINER: Basically, when you put that gold in that envelope, you're sending it off to the Wild West.

(END VIDEO TAPE)

HARLOW: All right, and, Richard, if that Gold Act becomes law in this country, it would make sure that customers accept the offer before any of their gold is melted down. If companies don't comply, they're going to get fined, but also mandates that these companies insure any jewelry they mailed back to the consumer at the same value that they insured it when they mailed it in, Richard, trying to protect people, because as you heard in the piece, some people feel like they're just getting ripped off -- Richard.

QUEST: So there's two issues, really, aren't there?

There's the price that they're getting and there's whether or not the gold ever reaches the other person. One is an issue of what's in the mail and dishonesty and the other, of course, is -- is just sharp practice (ph).

HARLOW: Yes. That -- that's exactly right. I mean you saw here Cash4Gold says that the U.S. Postal Service is where a lot of this gold is going missing, that it's getting stolen from the packets before it reaches them. And then you have the Post Office saying that's not exactly what is happening. And in the case of Frank Poindexter...

QUEST: All right...

HARLOW: -- the person we showed you, he told us that that's not what happened to him -- Richard.

QUEST: I'm assuming that if we don't see that necklace on you tomorrow, that it -- it's in the post, that you're sending it in, aren't you, to trade it out and make a bit of money out of the gold?

HARLOW: I wore it just for you, Richard. Maybe I'll mail it in. We'll see.

QUEST: Yes. And then we'll see how much it's really worth. That will soon be a moment of...

HARLOW: Exactly.

QUEST: -- a moment of truth.

(LAUGHTER)

QUEST: Poppy Harlow in New York.

Many thanks, indeed.

Now, we'll have another moment of truth. It comes concerning Greece and whether there has been an agreement. We think there has been. But when we return, there'll be a Profitable Moment that hopefully will make things clear.

Stay there. We'll be right back.

(COMMERCIAL BREAK)

QUEST: Finally, tonight's Profitable Moment.

A week ago exactly, I was talking to you about what the E.U. would do about Greece. Well, tonight, it seems France and Germany have inched glacier-like toward a solution -- a compromise of a deal that may not stand the test of time, but it is, at the moment, the best that they can come up with because of their very different political positions between Chancellor Merkel and, of course, President Sarkozy.

This whole matter of Greece has become a lot more serious this week than just the issue of what happens to that one country.

Firstly, there was the devaluation of the euro, which we heard Jim Boulden talking about tonight, now at 1:32 to the dollar, a 10-month low. It creates its own problems for the ECB managing long-term interest rates and maintaining growth.

There's the increasing worry of contagion. First, Greece was downgraded. Yesterday, Portugal.

So who's potentially next and out?

The next 48 hours will be important, as the Eurozone leaders try to show the leadership that the financial markets are seeking. If they can't come up with a workable plan, well, we might very well ask what use they are in the first place.

And that is QUEST MEANS BUSINESS for tonight.

I'm Richard Quest.

Whatever you're up to in the hours ahead, I do hope it's profitable.

"AMANPOUR" is next, after the headlines.

END