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QUEST MEANS BUSINESS
Pound Under Pressure; Austerity Debate; Gains for Most European Indices; Europe's Economy; Europe Too Timid; Watching Wall Street; Dollar Falling Against Yen; Kenyan Stocks Surge
Aired March 12, 2013 - 15:14 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MAX FOSTER, HOST: Hello to you, I'm Max Foster in London. This is QUEST MEANS BUSINESS, and we'll have more from the Vatican later in our show.
First tonight, though, the UK pound is trimming its losses after hitting a two year eight month low against the US dollar. Traders were reacting to a sharp and unexpected drop in industrial production in January.
That 1.2 percent month-on-month fall not only increases the chances of a second straight quarter of economic contraction, it makes further monetary stimulus from the Bank of England more likely, piling extra pressure on the pound.
Britain sets its budget next week, but don't expect too much in the way of stimulus. The government is firmly committed to austerity. A top US economist, Paul Krugman, says that's a mistake. Lately, he's had the EU commissioner Olli Rehn in his sights, accusing him of orchestrating a "Rehn of terror" and spreading "cockroach ideas," all because of his commitment to cuts.
In his "New York Times" blog, Krugman said Rehn was the "face of denialism" when it comes to austerity. Rehn hit back telling a Finnish newspaper, "Krugman put words in my mouth that would be termed a 'modified truth,'" his euphemism for a lie.
Now, most Europe's main stock indices made gains this Tuesday. If you look at the main indices, copper producer Antofagasta helped tip London's FTSE 100 into the black, the FTSE up only just on the day, though, as were some of the other main markets as well.
A pretty quiet day, but up nevertheless. Zurich's SMI up nearly 0.6 percent, FTSE gaining more than 3 percent on news it will double its dividend payments, rather the company I was talking about there. And Kazakhmys rose 6 percent, rebounding from a fall session slump.
In Frankfurt, Commerzbank fell sharply, closing 3 percent lower, and Zurich's SMI closed at its highest level in more than five years.
Now, Holger Schmieding is the chief economist at Berenberg Bank. He doesn't think austerity has been a bad thing across Europe. He told me it's been tough, but it's about to ease off.
HOLGER SCHMIEDING, CHIEF ECONOMIST, BERENBERG BANK: Fortunately, austerity is easing this year, which will likely allow the eurozone to escape recession sometime this spring as long as Italy doesn't blow up.
FOSTER: Is Italy the only big factor really looming?
SCHMIEDING: It's the one big risk out there. Italian politics are a bit -- well, the risk if there are new elections in early June, say, it would mean three more months of uncertainty until we know the Italian political setup, and that could weigh on markets and the economy.
FOSTER: That's the problem, isn't it? It doesn't matter who gets in, almost, you just want someone in power leading.
SCHMIEDING: Well, we basically need a government in Italy that commits itself to staying where Monti left. Namely, Monti fixed much of what needed to be fixed in Italy, but the government has to stay the course. Backtracking on the Monti austerity would be bad.
FOSTER: The other big currency in Europe is obviously the British pound. Interesting dynamic there. Basically, it's sinking, isn't it? Do you expect to reach parity with the euro soon?
SCHMIEDING: I don't think it will go down quite that much, but it's likely to go down a bit further on trend. We've talked about the eurozone economy being weak at the moment, but the British economy isn't very much stronger.
And on top of that, Britain has much more austerity to come in the future. It has a much looser monetary policy than that of the ECB, and that will likely mean that the UK economy and sterling go down somewhat relative to the eurozone and to the US dollar.
FOSTER: George Osbourne is taking the blame for what's going on in the British economy in the papers. He's never been that popular anyway, but he's really being hammered now, because he always talked about the credit rating. That's gone down a notch with Moody's, at least. But you're a fan of George Osbourne. What do you think he's doing right?
SCHMIEDING: Well, I think he's doing quite a few things right. First of all, this country simply needs some austerity. With a budget deficit that high and fiscal debts rising, the country needs to save more money. Osbourne is message on that.
And on top of that, he has seen to it that there are no tax hikes on corporates. Instead, there are some tax cuts for corporates, so he's trying to make the country as business-friendly as possible, which is the way to get back to growth in the long run.
FOSTER: Which means he's often against the other European finance ministers when it comes to those meetings, because he's sticking up for the city, for example. How much harm is his relationship is -- depreciating relationship, if we can call it that -- with the rest of Europe, with the eurozone?
SCHMIEDING: Well, I don't think that's very much a problem between Osbourne and the eurozone. It's much more the overall leadership of the conservatives, which has asked or put the idea on the table of a referendum on staying in the European Union, which is simply something which creates uncertainty until after that referendum.
And that very uncertainty about the future of Britain in Europe or not might actually weigh on business investment in Britain, and hence on the economic performance.
FOSTER: Holger Schmieding speaking to me earlier. Well, Jim O'Neill is the chairman of Goldman Sachs Asset Management. He told our Nina Dos Santos that as the US improves, Europe's situation is at risk of deteriorating.
JIM O'NEILL, CHAIRMAN, GOLDMAN SACHS ASSET MANAGEMENT: The big places in the world are all going in the right direction. The US is showing more and more signs of not only cyclical improvement, but structural change. So, I suspect this time next year, US unemployment will be down quite a bit and people won't be quite so freaked out about the US.
NINA DOS SANTOS, CNN INTERNATIONAL CORRESPONDENT: And for Europe? What does that mean?
O'NEILL: Europe has got to get its act together. Europe has got to wake up and want to have more. It's got to stop being so timid and sort of being scared of itself and everybody else. Be bold and take more initiative. Without that, Europe's going to continue to be certainly relatively declining and possibly absolutely as well.
(END VIDEO CLIP)
FOSTER: Jim O'Neill. Well, after setting an intra-day high at the open, the Dow Jones has actually fallen back down, actually, on the day so far, but actually, it's just flipped up again, as well. But it's pretty much at parity from yesterday, 14,447.
The S&P 500 and the NASDAQ are in the red. The Dow had been 30 points higher earlier in the session. Merck is the top gainer on the index, up more than 3 percent. The drug maker says it's been allowed to continue trials on its Vytorin cholesterol treatment.
A Currency Conundrum for you now. Ever since Benedict XVI stepped down as pope, the Catholic Church has been in the state of Sede Vacante, or Vacant Seat. To commemorate this, the Vatican will mint rare 5 and 10 euro coins with what on the front?
Will it be A, the dove of the Holy Spirit? B, the dome of St. Peter's Basilica? Or C, a picture of Pope Emeritus Benedict XVI? We'll have the answer of you later in the show.
The dollar is falling sharply against the Japanese yen. Right now, a dollar buys you around 96 yen, down two thirds of a percent from Monday. It's holding steady against the pound and the euro, though.
FOSTER: Kenya's stock market is continuing to rally following the announcement of a winner in the country's largely peaceful election. Kenya's benchmark index, the NSC 20, added almost 4 percent this session, extending its 10-month bull run.
On Monday, Uhuru Kenyatta was declared the winner of the presidential poll. Investors were also cheered by the peaceful aftermath of the ballot as well. Nima Elbagir is in Nairobi and joins me now.
It would be easy to say, Nima, that this was just a bounce from the election, but actually, it's been a pretty steady bull run for a while now.
NIMA ELBAGIR, CNN INTERNATIONAL CORRESPONDENT: Absolutely. The market's been expressing confidence in Kenya's constitutional electoral reforms for quite a while now. The market's been up about 22 percent here, second only to Ghana in terms of returns for dollar invested in sub-Saharan Africa.
We did see a little bit of slowness in the shilling against the dollar last week when that vote tally seemed to go on endlessly, but the shilling's bounced back and the central bank, which at one point in the week in the run-up to the election, was buying up shillings frantically trying to stave off a shilling-to-dollar fall -- precipitous fall, I should say. That's actually sitting quite pretty, they're feeling quite smug, they're getting some money back.
But of course, we should say that this isn't over yet, Max. Raila Odinga, Uhuru Kenyatta's rival in this poll, is taking his contest of the election results to the Supreme Court, and we're expecting to hear more about that towards the end of this week.
But I think what the market is expressing is confidence in the fact that after that contested -- that deadly contested 2007 poll that Kenya now has institutions, and the institution are working. And even though Odinga has contested this poll, that that's being seen through the legislative processes and that both sides are calling for calm, and that calm seems to be holding, Max.
FOSTER: Good news for now. Of course, in terms of investors, what they really look to for some solid evidence, or analysis at least, is the credit rating agencies. How are they doing in Kenya right now?
ELBAGIR: We had some really interesting analysis coming out of Fitch. They reaffirmed this sense of investor confidence in the constitutional processes, and that the market was responding favorably to Odinga's taking this through the courts.
But they brought up something which I hadn't actually heard before. One of the concerns that we had been hearing was that given that Uhuru Kenyatta and his running mate, vice president elect now, we should say, William Ruto are both up at the ICC on charges of crimes against humanity.
The concern had been that the market was watching very closely for any signs that they wouldn't cooperate with the ICC, and that would bring sanctions down on Kenya. Kenyatta and Ruto are, of course, continuing to reaffirm that they will cooperate.
But what Fitch is bringing up is this issue that even if they do cooperate, they're worried that being up at the ICC, given that we have no idea how long this case could last, being up at the ICC could distract them from their day jobs and distract them from what Fitch and other ratings agencies see as much-needed broader market and legislative reforms. So, that's one that people are going to be watching very closely, Max.
FOSTER: Good stuff. Nima, thank you very much, indeed. Now, something a bit different. The campaign to stop New Yorkers' expanding waistlines has been dealt a blow.
(BEGIN VIDEO CLIP)
MICHAEL BLOOMBERG, MAYOR OF NEW YORK CITY: A billion people will die of smoking this century, and at the rate obesity's growing, it will be even worse for obesity. Obesity is going to bankrupt this country.
(END VIDEO CLIP)
FOSTER: New York's mayor just isn't giving up.
FOSTER: Welcome back, I'm Max Foster in London. These are your news headlines. Black smoke has risen over the Sistine Chapel in a sign that no new pope has yet been elected. Cardinals in the Vatican have begun the conclave to decide the next head of the Catholic Church. The black smoke signifies that no decision was reached in the first ballot. White smoke will emerge when a new pontiff has been chosen.
Frankfurt International Airport has reopened two runways, allowing a few flights to take off and land. A winter storm forced Europe's third- busiest airport to shut down earlier today. Hundreds of flights have been canceled.
99.8 percent of Falkland Island voters say they want to remain under British rule. Argentina, which calls the islands the Malvinas, dismissed the vote as a publicity stunt with no legal merit. British prime minister David Cameron says Argentina must respect the islanders' wishes.
The US director of national intelligence says he believes Bashar al- Assad's, quote, "days are numbered" as Syria's president. James Clapper told the US Senate Intelligence Committee that Syria's opposition is gaining ground against the regime with the help of the blacklisted al-Nusra Front.
A judge has entered a not guilty plea for the man suspected in a mass shooting at a Colorado movie theater. The decision came after James Holmes and his lawyers said they weren't ready to enter a plea. Holmes is accused of killing 12 people and injuring 58 others last July, but the defense might still enter a plea of not guilty by reason of insanity, but it would be subject to the judge's approval.
(END VIDEO CLIP)
FOSTER: Well, Becky is live for us at the Vatican tonight.
And, Becky, the cardinals did help here a bit this time 'round, didn't they? A very clear message at least.
BECKY ANDERSON, CNN HOST: Well, it wasn't that clear if you were watching, to be quite frank. The moment came one of many moments possibly this week. And when you first saw the smoke at 7:42 local time, for half- past 8:00 here now, it was difficult, because it's dark, of course, to see. It's just over my shoulder here.
And (inaudible) see the color of that smoke. It will be easier during the daytime. Ballots, of course, they will be four of these ballots now and in the days ahead until a new pope is chosen. It's a chilly old night here. But there were thousands of people in St. Peter's Square to watch the chimney to see that first smoke.
Didn't have to actually vote tonight by law. But they did. No pope elected, as you say. It was black smoke. You've got to get a majority of two-thirds, 77 cardinals have got to vote for one man in order for him to be elected pope; 115 went in of course earlier today. One man will come out as pope when this process has finished.
I said there were thousands of people. I'd say a couple of thousand people here tonight and a lot of people have come after work. There are quite a lot of tourists around. As I say, it's a chilly night. But the city of Rome itself and indeed Vatican City behind me are expecting hundreds of thousands of people to be here come possibly the weekend.
A lot of people are saying this process may close out at the end of the week. It's taken -- it's been nearly 100 years since this process has taken more than five days. And if that were to happen, Max, you could have an inauguration in the square behind me on Sunday.
At the same time, you've got a number of other events going on in Rome. So far as logistics on security are concerned, well, it could be a bit of a nightmare.
(BEGIN VIDEO CLIP)
ANDERSON (voice-over): The weather is notoriously bad in March in Rome. But what's a bit of rain among pilgrims when you've got a conclave in town? The papal election is underway and in the hours, days or weeks to come, there will be an inauguration here at St. Peter's Square. The security preparations are underway.
You can see the media packed here. It's all happening; the question is, when will the big day arrive?
ANDERSON: Mr. Mayor, how do you cope with an event like that unscheduled event like that?
GIANNI ALEMANNO, MAYOR OF ROME (through translator): We have to be flexible. From today, we are going to put up tents with all the services. But we are ready to line up 1,000 men for when the new pope is elected.
ANDERSON: Indeed, that's what's brought all of us here to Rome. But for emergency transport and security services it's not all about the election of a new leader of the Catholic Church. As it happens, they're also preparing for a couple of other major events set to unfold here this weekend.
ANDERSON: (Inaudible) Olimpico capacity, over 70,000. Saturday Ireland play Italy here in the (inaudible) rugby tournament. Before that, on Thursday, (inaudible) play Stuttgart here in the Europa League.
On any given day, there are hordes of people here at the Colosseum. But Sunday is the Rome Marathon, and the race starts here, some 12,000 people taking part on top of that there's a 4K fun race. Another 85,000, all of the roads around here are going to have to be cordoned off.
ANDERSON: There could be tens of thousands of extra people arriving here at Rome's main train terminal. So when they find out when the inauguration is actually going to happen, there's hundreds of helpers standing by on Segways to sort people out.
Simple question: will Rome cope?
ALEMANNO (through translator): All this will cost 4.5 million euros. And we have to face this expense. Also with the help of the state. We are prepared but we hope the state will help us with it.
ANDERSON: Who pays? Rome? Or the Vatican?
ALEMANNO (through translator): Everything that happens in the piazza is paid by the Vatican. And everything that happens on this road is paid by us.
ANDERSON: So you push everybody into the Vatican?
ANDERSON: The mayor of Rome speaking to me earlier. They've got a lot on, but as he says, he's just got to be flexible, Max.
FOSTER: Becky, thank you very much indeed.
(BEGIN VIDEO CLIP)
FOSTER (voice-over): And Becky will host "CONNECT THE WORLD" tonight from Rome. She'll have the global view as Catholics around the world wait to see who will lead their church. That starts at 9:00 pm in London, 10:00 in Berlin here on CNN.
(END VIDEO CLIP)
FOSTER: Now a ban on the sale of big sugary drinks was due to come into effect today in New York. As we told you this time yesterday, it's been thwarted. A judge declared the ban on it to be invalid, with just hours to go.
The city wants to outlaw sodas sold in containers bigger than 16 ounces or half a liter. Mayor Michael Bloomberg appeared on "The Late Show" with David Letterman to explain why he is not giving up the fight.
(BEGIN VIDEO CLIP)
MICHAEL BLOOMBERG, MAYOR OF NEW YORK CITY: (Inaudible) judge said the Department of Health didn't have the authority to do it. We think that they do. We'll appeal. In the meantime, this year, 70,000 Americans will die from obesity; 5,000 here in New York. We've got to do something about it.
DAVID LETTERMAN, CBS HOST: So 70,000 Americans --
BLOOMBERG: Seventy thousand people will die from obesity.
(END VIDEO CLIP)
FOSTER: Richard Roth is following things from New York.
Richard, the judge seemed pretty clear in his ruling.
RICHARD ROTH, CNN CORRESPONDENT: Yes, and the mayor doesn't like it. If you thought Bloomberg was going to stop following this decision that blocked the startup of his soda ban over 16 ounces, you'd be wrong.
The mayor and health officials from the city -- that's a doctor from a hospital in the Bronx -- were showing off how much soda -- sugar you could consume with something over 16 ounces, and the dangers of it.
The officials were at a restaurant, Lucky's restaurant. He might not have been lucky in court on Monday, where this is an establishment where the owner is still going to follow along with the ban on soda. And the owner of Lucky's explained why it really comes down to making a good choice for your life.
(BEGIN VIDEO CLIP)
GREG ANAGNOSTOPOULOS, LUCKY'S CAFE OWNER: You can drink whatever you want. You could have six cans. You could have 12 fountain sodas. I don't care. But at the end of the day, we offer you a 64-ounce and you drink it all, I think that's the worst thing you could do. You know, it's like shoving a cake down your throat, a whole cake.
ANAGNOSTOPOULOS: What's good in that, you know? Moderation. That's what I believe.
(END VIDEO CLIP)
ROTH: The mayor says that it's obesity that kills, citing various health rates and reports, showing that high sugar consumption leads to diabetes and other ailments.
The mayor also recalled how his efforts against trans fats, calorie counting menus to be installed and other behavioral changes from the government have really helped, and that other cities are following things like the New York smoking ban.
(BEGIN VIDEO CLIP)
BLOOMBERG: If you take a look, virtually all of South America has now gone smoke-free, all of western Europe has now gone smoke-free, and Asia countries are starting to go smoke-free. And that's what scares some of the manufacturers so much. As "The Economist" said, if it happens here, it will happen everywhere.
(END VIDEO CLIP)
ROTH: Mayor Bloomberg only has a few more months left in office. But when he was asked will you be still pursuing this issue, he said, quote, "You can bank on it." And Bloomberg's got a big private bank.
Max, of course, once again to show people what is really up for grabs here, when you're consuming the liquids, this is 16 ounces, which is acceptable. This is way above 16; this is 40 ounces, not acceptable.
The problem is that a big convenience store, the 7-Eleven chain has these 40 ounces, and it's exempt from New York City rules. So that's what the judge said about many aspects of the city plan was arbitrary and capricious. The mayor is going to be fighting and appealing in a higher court, Max, back to you.
FOSTER: (Inaudible) Big Brother as well, whether or not they're bad, whether or not people should be drinking these drinks and whatever the doctors say or the mayor says, it's just the idea that you're being told to do something in American society. Is that seen as contradictory?
ROTH: Yes, that is still one big aspect of the debate, whether you have the true freedom or what is the role of government. Critics have said Bloomberg has installed a nanny state. But I can tell you, if you don't like smoking or if smoking is bad for you, you don't have to now inhale smoke in a lot of restaurants. And we know in Europe and a lot of other places, that has taken hold.
Is there a limit, though, to how much the mayor can do? I think when he -- this week, last week, he talking about music in your headsets. Some people may love to blast their music. If you're sitting next to that headset on a subway or in a private vehicle, you can't stand it. So there's two sides to this argument, and it's going to continue, I think, going forward.
FOSTER: All right. We'll leave it with you. Richard, thank you very much indeed.
Now what do "Lord of the Rings," curly fries and Morgan Freeman's voice all have in common? The answer: they are all things that an intelligent Facebook user might like. Next, why your profile says much more about you than you think.
FOSTER: Now clicking "like" on Facebook is something most of us do without thinking. Now a study from the Cambridge University says the pages you like are revealing -- as revealing as taking a personality test, would you believe. In fact, some parts of your identity can be predicted with 95 percent accuracy. And it's not always the obvious pages that are revealing.
For example, if you're a Facebook fan of Honda, for example, that's apparently a good indication that you're a non-smoker. If you prefer to follow Harley-Davidson on Facebook, it can say even more. It's a strong indicator that you're a white American, perhaps unsurprisingly for such an iconic American brand. Unfortunately, it's also a good indicator of low intelligence -- their words, not ours.
And the one brand in this study that tells us most about you, Hello Kitty. According to the study, if you like their page on Facebook, there's a good chance you vote Democrat.
Not only that, but when it comes to personality tests, you probably score highly in terms of openness and poorly in terms of emotional stability. So exactly how does liking Usain Bolt mean you're probably single or (inaudible) popular? I asked one of the study's authors how they piece together these extraordinary predictions.
(BEGIN VIDEO CLIP)
DAVID STILLWELL, RESEARCH MANAGER, CAMBRIDGE UNIVERSITY: It would be sort of (inaudible) prediction if we just showed that people who, you know, clicked on things like gay marriage were more likely to be homosexual.
Even with things that have nothing to do with, you know, any of these traits -- for example, camping -- so people who said that they liked camping were ever so slightly more likely to be homosexual.
So what that means is by the time we can take lots of these sort of small pieces of information, put them all together, so the average person likes about 160 different things on Facebook. So we can really sort of build up the picture about them based on all of the different things about them.
So if I (inaudible) for example, and there were some obvious things like science and Mozart, both of these two are related to higher IQ. And but there are also some less obvious things, like curly fries, for example, and Morgan Freeman's voice. So there's a Facebook like Morgan Freeman's voice, and people who like that, for some reason, tend to have a higher IQ.
FOSTER: That's all very interesting, isn't it? And it's not too worrying to have out there. But it is concerning when you can start noting people's political sensitivities, their sexuality. If brands can get hold of that information, and use it, that's when it starts becoming a bit worrying, isn't it?
STILLWELL: Sure. So I think everyone has a different comfort level. I mean, for me, the ideal situation would be as if I went to a website and then instead of that website trying to sell me all of their range of products, you know, because they don't know anything about me other than my IP address, if I could tell them a little bit about me, so that they could then tailor their -- my user experience and to give me something as an individual when I visit their site, then I'd much prefer to see the two products which are definitely related to me rather than the rest of their catalog.
So there are definitely benefits. But of course, some people, you know, people will have different levels of comfort. And fortunately, Facebook provides lots of (inaudible) settings. So you can decide who you share your information with and then sort of fit with your comfort level.
FOSTER: So that's what you should do? You should have a look at those privacy settings. And so you feel that they're easy enough to understand for most people at this point? Because they're getting more and more complicated, from what I can tell.
STILLWELL: I do know that they have an option so that you can view your own profile as if you were, let's say, a stranger or a friend. And then you can see exactly what a friend would see when they look at your profile. So they do provide some tools to make it simpler than it would be otherwise.
(END VIDEO CLIP)
FOSTER: Unbelievable, isn't it? Now the South by Southwest festival is in full swing in Texas. It's a mecca for creativity. Gary Shapiro is head of the Consumer Electronics Association. He's invented a concept called Ninja Innovation. It's the title of his new book. I asked him exactly what it means.
(BEGIN VIDEO CLIP)
GARY SHAPIRO, PRESIDENT, CONSUMER ELECTRONICS ASSOCIATION: Ninja is one word that describes the ancient warriors, where these people were highly trained, small teams, very effective against a much larger enemy.
And it's a concept, really, more than a word. And the concept is that you have to do whatever it takes to succeed. You have to have a plan. You have to have a great team. And you have to be really clever and think outside the box. And then you could slay the bigger dragon.
FOSTER: It's about preparation, isn't it? It's one thing to win. But it's about preparation, anticipation.
SHAPIRO: Sure. Cooperation is a big part. Not only do you have to cooperate and communicate among the team, because one of the great myths in American society is of the sole entrepreneur all by himself or herself creating this great company, whether it's Bill Gates or Mark Zuckerberg or Steve Jobs.
But you also have to get to know your enemy and even there's a book that came out called "Cooptation." You have to get to know them and work with them when it makes sense to do so.
So in the business world, in the world of governments, and even in people, you're always out there with alliances, friends and even those that you disagree with. But you should always be cordial to them, as I try to do in my life.
FOSTER: You've worked in close contact, haven't you? Or relatively closely to the -- to the likes of Steve Jobs, real innovators, heroes, really, of more than business.
Did they adopt this strategy? Do you learn it from them? Or did you just see something they were all doing in common?
SHAPIRO: Well, what they all have in common is as innovators and now in my career of 30 years, dealing with the consumer technology industry and the leaders around the world and getting to see which products work and which didn't, and which companies succeeded and which ones failed, there is a lot of commonality.
And it's the biggest commonality is the ones that succeed think outside the box. They're willing to take risks. And they're willing to fail. Now because failure itself in business and in life, personal life, is really the ultimate learning experience where you really take leaps forward in your understanding of what you can do next time better.
FOSTER: There's all those advantages the U.S. has -- disadvantage right now is all that political wrangling in Washington. You want support as a business community, don't you? But you're not necessarily getting it because of all this wrangling over the budget in particular. What's your view on that and what can Washington do to help you?
SHAPIRO: Well, I think the business community is looking for the leaders of both parties to get together and solve these problems. Certainly business leaders like (inaudible) social issues. But on the question of the deficit and taxes and issues like that, they are very, very united.
And I think they're definitely a little frustrated. The U.S. tax system is increasingly pushing companies to go abroad, whether it's having the highest corporate tax rate or not allowing the funds that are taxed and made overseas to come back to the U.S., and combine that with a pretty broken immigrant system, where almost 90 percent of the immigrant spots are filled by relatives so the PhDs we're giving to science and math and engineering students, we're kicking those people out after we train them and at top level universities, is the corporate leaders in America are very, very frustrated with the U.S. political system.
And I think the blame is going all around. It's just not the White House and Democrats; it's also the Republicans. I think they're looking for something else right now, a new way of doing things. And that's what we hope they'll do.
(END VIDEO CLIP)
FOSTER: Well, after the break, wild weather is causing travel chaos across Europe. We'll have the latest for you from the CNN Weather Center.
(BEGIN VIDEO CLIP)
FOSTER (voice-over): Time for the answer to today's "Currency Conundrum," earlier we asked you what the Vatican mint on the front of the rare coin to commemorate the Sede Vacante are. The answer is A, the dove of the Holy Spirit. The 5- and 10-euro coins are collectible and theoretically can only be used within the Vatican walls.
(END VIDEO CLIP)
FOSTER: That's a good thing the cardinals are already in Rome. There have been some horrendous travel problems across Europe because of snow.
(BEGIN VIDEO CLIP)
FOSTER (voice-over): The Frankfurt airport, which is the third busiest in Europe, was completely closed for several hours; 700 flights were canceled, two runways have now reopened. Meanwhile all Eurostar train services have been canceled today. The disruption is set to continue into Wednesday.
Jenny is at the Weather Center and can we expect more tomorrow, Jenny?
JENNY HARRISON, CNN METEOROLOGIST: Well, you can expect more delay and cancellations, I think, probably, Max. Eurostar is saying, of course, Wednesday is going to be an amended service. That's what they're calling it. And then, of course, you've got a lot of catching up to do with the airlines. And there is more snow in the forecast.
In fact, Frankfurt, possibly another 9 centimeters of snow. This is the picture on the satellite, gives you a pretty good overview as to how much weather is out there.
It's a very unsettled picture. And you can see the snow is continuing to come down across much of central and southern Germany, still across into the low countries and also into Paris, as you -- Paris into France, as you can see that Paris has certainly been picking up a fair amount.
When it comes to some of the totals, it is incredible, 12 centimeters in Frankfurt -- this is just on Tuesday. And look at this, 36 centimeters in northern France in about four locations, all coming in with a really high amount. And it's all in this area, literally just on that north coast across from the channel.
Now these are the main airports, the top five you mentioned, Frankfurt, Max, as being the third busiest airport, certainly in Europe. And these four, as you say, are all really pretty much where the weather has been and still is bad. Not so much perhaps London Heathrow, things picking up there.
But you can see Paris, Frankfurt, Amsterdam; and it's the amount of people that are impacted. So of course, all those flights canceled, over 700 of them into Frankfurt. That, by the way, is just over half the normal daily number of planes that are coming out of the airport.
And then you can see, look at this throughout the year, over 57 million people getting on for half a million flights. The cargo -- this is actually vital, Frankfurt. It's a really busy airport for that, 2.1 million metric tons of cargo here.
And the number of airlines, 110 operate at some format in and out of Frankfurt. And of course, 300 destinations around the world. So it gives you an idea why there is such a knock-on effect. Now the snow that's there, the ice, of course, as well. This is going to stay because look at these temperatures. These are temperatures with the wind factored in, the -3 in Berlin, -6 in Copenhagen.
The winds are not as strong as they were. This will help because a lot of the snow that we saw was blowing snow. The winds were over 100 kph at times. Nothing like that; in fact, the strongest winds are going to transfer into central areas of Europe. That could have an impact certainly in Rome for the next few days.
And these are the totals of snow. There I mentioned, that nearly 9 centimeters into Frankfurt, Luxembourg 12 centimeters. And you can see it's very widespread. So it will continue. (Inaudible) heavy as it was; the winds won't be as bad. But it will stay very cold. The system across the south, it's going to move fairly rapidly through the central Med.
But look at this in Rome, the last 12 hours. We saw thunderstorms; it was very heavy amounts of rain. Right now it looks as if the rain's actually come to an end. But we saw the light rain all the way across through the evening hours. And then Wednesday, with that system coming through the Med, more thunderstorms and rain, the same possibly on Thursday.
There's all the snow that's accumulating. We will see some snow across central areas of Italy as well. There's the big picture across Europe. So it will gradually improve, Max. But there's a lot of catching up to do, particularly when we talk about Frankfurt airport.
FOSTER: Yes, it really is bitterly cold in Europe. Thank you so much, Jenny.
More QUEST MEANS BUSINESS for you after the break.
FOSTER: Well, for the first time in a week, the Dow may be about to finish in the red. This how things stand as we come to the final few minutes of trade on Wall Street, down just 2 points. So it's marginal, really, still pretty high level generally. The Dow did another intraday record shortly (inaudible) open above 14,470. Analysts have been warning us to prepare for an eventual pullback.
Apple shares have been edging, though, over worries about slowing demand for the iPhone 5. European markets had a mixed session, really, only (inaudible) DAX, you know, very snowy Frankfurt finished in the red. The FTSE 100 managed to pull in around 7 (ph) points, despite the weak manufacturing numbers that we saw from the U.K. today.
As we mentioned earlier, that raises the likelihood of more stimulus measures coming for the British economy in the months ahead. And that's put further downward pressure as well on the pound.
That is QUEST MEANS BUSINESS. I'm Max Foster in London. Thank you for watching. I'll be back in a moment with the news headlines for you.
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FOSTER (voice-over): The headlines: black smoke has risen over the Sistine Chapel in the sign that no new pope has yet been elected. Cardinals in the Vatican have begun the conclave to decide the next head of the Catholic Church. The black smoke signifies that no decision was reached in the first ballot. White smoke will emerge when a new pontiff has been chosen.
Frankfurt International Airport has reopened two runways, allowing a few flights to take off and land. A winter storm forced Europe's third busiest airport to shut down earlier today. Hundreds of flights have been canceled.
99.8 percent of Falkland Island voters say they want to remain under British rule. Argentina, which calls the islands the Malvinas dismissed the vote as a publicity stunt with no legal merit. British Prime Minister David Cameron says Argentina must respect the islanders' wishes.
A judge has entered a not guilty plea for the man suspected in a mass shooting at a Colorado movie theater. The decision came after James Holmes and his lawyers said they weren't ready to enter a plea. Holmes is accused of killing 12 people and injuring 58 others last July. The defense might still enter a plea of not guilty by reason of insanity, but it would be subject to the judge's approval.
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FOSTER: That's a look at some of the stories we're watching for you this hour. "AMANPOUR" is next.