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QUEST MEANS BUSINESS
Greece Debt Crisis; The View from Athens; Greek Fire Burns Europe; Thumbs Down for Spain; SAP Profits Jump
Aired April 28, 2010 - 14:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MAX FOSTER, ANCHOR: Make or break time in Greece. Germany says details of a bail out will be worked out in days. These in contagion no growth. Portugal's prime minister tells investors, we're not the next Greece. And Spain gets the downgrade treatment. The third country this week to have its credit rating cut. I'm Max Foster for Richard Quest. This is Quest Means Business.
Good evening. I'm Max Foster in London, and tonight on Quest Means Business, we have extensive coverage of the crisis playing out in Greece. Frederick Pleitgen is in Germany where Germany Chancellor Angela Merkel, the IMF, the European Central Bank and others are the big players. I'll talk to you about the way ahead.
We're live in Athens as well, where Diana Magnay has been getting the mood of the people there as these organizations make decisions on their future. And, Al Goodman is in Madrid on a day when Spain has had its own credit rating downgraded. It fears this crisis is contagious.
And for good measure, we'll also hear from a former official of the IMF about European policymakers are coating pieces not well.
Now, Germany is prepared to do its part to help Greece, but only if Greece makes an effort to help itself. German Chancellor Angela Merkel indicated her government would lead towards move fast to release emergency funds if negotiations over the next steps in the Greek government austerity plans succeed.
Well, Greece may need up to $158 billion over the next three years according to German lawmakers and they say, they were given a figure by the head of the IMF. Fred Pleitgen joins us live from Berlin - Fred.
FRED PLEITGEN: Hi, Max. And of course, Germany is supposed to pay about $11 billion of that money that Greece needs to survive and certainly it's supposed to pay that in quite a short amount of time as you said. It was quite interesting today because as you mentioned, there was some very important people here in the city today on the one hand, the head of the IMF, Dominic Strauss-Kahn and of course, also the head of the European Central Bank.
And both of them were basically trying to put pressure on the German government to move faster. There had been some sense that the German government quite reluctant to actually give Greece a bail out. So certainly that was one thing that was a cause of great concern.
And if you saw the press conferences that went on today, they pretty much follow the same sort of pattern where you would have a German official say, well, we need to rethink all these. We need to think through all these very thoroughly and then you would have the head of the IMF say yes, but you have to move very, very quickly.
As you said, in the end Angela Merkel said, the German government will move decisively, but wants to see more measures from Greece first. Let's listen in to what she had to say at a press conference earlier today here in Berlin with the head of the IMF.
(BEGIN VIDEO CLIP)
ANGELA MERKEL, GERMAN CHANCELLOR (through translator): We're talking about the stability of the Euro zone in total and we don't want to take -- we want to take the responsibility, but it is absolutely necessary to trust into the markets - into Greece is the most important thing and that must be assured. And for that, Germany will do its part, but also Greece has to do its part.
(END VIDEO CLIP)
PLEITGEN: You know, Max, one of the things that financial experts have been saying, they see that one of the reasons why there so much insecurity in the international financial markets and may have possibly one of the reasons why things are going so badly for Greece right now is Germany's reluctance.
You know, Germany has always put a lot of emphasis on instability of the Euro. Now to see Germany so reluctant is really something that's making a lot of people quite insecure. Now, we have heard from German officials that if in fact, the International Monetary Fund and the Greek government come to an agreement to finish off the process of bringing a new austerity plan into action and the German government could inact a law that would see money flow to Greece as early as May 7th - Max.
FOSTER: Fred in Berlin. Thank you very much. Well, help will come at a price and the people of Greece are anxious to know what conditions will be attached. From Athens, Diana Magnay joins us now. It's must be very difficult for such a proud country, Diana.
DIANA MAGNAY: Absolutely and it is such a proud condition for a country to have conditions proposed upon them by external bodies, i.e., the IMF. That people here in Athens finds extremely difficult to stomach. They're going to be told that they're going to have their salaries cut, their pensions cut.
There are times aid extended, they prefer that to be the decision of their own government rather than external forces. So you have the strange contradiction here where they need money from the IMF and the EU, but most people here are convinced, in a recent independent polls, in fact 65 percent of Greek said that they felt that they would be negatively impact by that kind of bail out package.
Here's a little summary of what people we spoke to at Athens had to say. So, Max, I don't think you did have the sound bite there, I'm sorry about that. The Greek prime minister did say today in the parliament that IMF and EU (inaudible) had put green light on at the austerity measures.
And we said that the reform package would entail things like a plot in a local government cut in red tape, battling down on or hammering out any kind of corruption and that it should finalized in a few days. So those are the measures, which the rest of the Euro zone leaders need to see put in place.
That austerity package needs to be put in place before a cent will be released to Greece - Max.
FOSTER: Diana, thanks so much for joining us from Athens. Now the next few days will be critical not only for Greece, but also for the Euro zone as a whole. The Greek prime minister has liken the crisis to a fire which certain to engulf the rest of the single currency zone and already investors across Europe are getting burned as you can see.
European stock markets stumble for second day of the growing doubts that Greece would be able to pay its debts. Those doubts are now infecting other Euro zone nations. Spain's credit rating was cut one notch today. We'll have more on that in a moment.
Portugal's credit rating was also lowered on Tuesday and Greek bonds have been downgraded unsurprisingly to the level that investors regard as junk. (Inaudible) pressure on the Euro, which is trading its lowest level in a year against the dollar. The Euro has fallen 8 percent against the dollar this year.
And Portugal's main top index also saw sharp losses. Lawmakers say they'll push on with their austerity program. Standard and Poor's cut its credit rating on Portuguese government bonds by two notches to A minus.
And Portuguese prime minister says his opponents support spending cuts, his spending cuts saved the country from a fate like that of Greece.
(BEGIN VIDEO CLIP)
JOSE SOCRATES, PORTUGUESE PRIME MINISTER (through translator): We're working together (inaudible) what is a speculative and unfounded attack both on the Euro and on the sovereign Portuguese debt.
(END VIDEO CLIP)
FOSTER: Spain became the latest European country to suffer the hands of the credit agency. Standard and Poor's cut its rating on Spanish bonds to AA down from AA plus. From Madrid, I'm joined by Al Goodman. They must be watching all these with great tribulation, Al?
AL GOODMAN: Hi, Max. Well, the majority of the stock market already was jittery volatile this whole day on the latest developments in Greece and the news of the Standard and Poor's downgrade came just minutes before the market closed. It was trading down at that moment, 1-1/2 points down. Within minutes, it tumbled to 3 points down, which is where it closed 3 percent down.
Over the last two days, it has lost 7 percent, and some analysts here said, this was expected. The government was prepared for a period for this and it quickly fought back with these words from the deputy prime minister. Let's listen.
(BEGIN VIDEO CLIP)
MARIA TERESA FERNANDEZ DE LA VEGA, SPANISH DEPUTY PRIME MINISTER (through translator): We are doing our homework and doing it well. We have a serious plan for fiscal consolidation and deficit reduction. I want to send a message of confidence to the citizens and to the market.
(END VIDEO CLIP)
GOODMAN: The problem, Max, is that with that message of confidence, there's also got Spain's unemployment rate, the very highest in the European Union, twice the rate of the European Union. When the new figures are do out on Friday, it's expected to be 20 percent unemployment, more than 4 million people unemployed here and that's enough to make the markets and Standard and Poor's nervous - Max.
FOSTER: What about Portugal? These people say that's going to be the first to go after Greece, the scare mongers at least.
GOODMAN: Well, you know, the Portuguese finance minister was here in Madrid just recently and was sending out that same sort of message of confidence that we just heard from the Spanish deputy prime minister, but clearly the analysts are looking at Greece and Portugal, those are smaller players.
And so people here have been describing it as you cut off a finger or maybe a toe, but when you get to Spain then you're getting into part of the body of the EU, the euro and this is why there so much nervousness here - Max.
FOSTER: Al, thank you so much for joining us from Madrid then. Alessandro Leipold is a former acting director of the European Department of International Monetary Fund. He joins me now from Washington.
It's extraordinary. We've been going around all of our correspondents in Europe and they've all got a story to tell. It's taking the whole continent, isn't it?
ALESSANDRO LEIPOLD, FORMER MANAGER, IMF: Indeed, indeed and it - the sad thing about all of these is that it was foreseeable in a way and that the Europeans regrettably didn't realize from the beginning that they simply don't have the instruments or the institutions to react rapidly to this sort of situations.
And they saw as a humiliation for turning to the fund when in fact the real humiliation is what is going right now. Having said that -
FOSTER: Sorry, I'm just wondering if the IMF is the best solution here or whether the German government is the best solution. There seems to be some sort of competition between the two.
LEIPOLD: I was about - again, I was about to add that you know, it's encouraging the news that just came out from Berlin today. Certainly the first bit of good news we've had for a long time. Now, the - I'm sorry, I'm getting an echo in my -
FOSTER: Apologies for that.
LEIPOLD: In my ear piece which is a little annoying.
FOSTER: We'll try and adjust that. Try to concentrate as best as you can -
LEIPOLD: Sorry about that - and the first bit we've had for a long time and if indeed everything that was announced in Berlin today takes place, if there is an agreement over the weekend. And if the German parliament goes ahead and improves a loan in the course of next week, perhaps, you know, the disaster that I wrote about in a piece -- air for the Lesbon Council may be averted.
Provided I have a two other things. First obviously that the policies agreed upon are strong and credible, but second also that the financing is a, large enough to meet the needs, and b, specified also beyond 2010 and also for 2011 and 2012.
FOSTER: OK, but this is just a solution for Greece. If Germany starts doing this sort of thing for Greece, it's got to be prepared to do it for Portugal, Spain, Ireland, a lot. Hasn't got that much money, has it?
LEIPOLD: Well, you know, there are - again that is why - and you know, I don't speak simply as an ex-IMF on this. I think that is why there is an institution internationally equipped to do this. To do it rapidly with the funds because it was equipped with a lot more money at a recent (inaudible) meeting.
And it has the expertise and the instruments and the means to do that rapidly in a way that markets understand. So I don't see turning to the IMF is a problem. I think what the problem has been is the lack of willingness to consider that by the Europeans to work jointly.
They did in the case of Lisbon Hungary admittedly not Euro area members, but still EU members. At the end of 2008 and those programs have gone quite well and happened - and succeeded in calming markets.
FOSTER: OK, Alessandro Leipold, thank you very much indeed for joining us.
LEIPOLD: Thank you.
When we come back, the index you will see anywhere else. It's the corporate earning season. Turning into a green wash. We're asking that question. Time out with the Q-25 in just a moment.
FOSTER: Everyday this week, we're bringing you the latest from the Q-25. This program's very own index to help you make sense of the corporate earning season. Out of hundreds of companies that are publishing results this week, we've chosen 25 encompassing a wide range of sectors. We give a green balloon for each strong set of results and a red balloon to firms that are underperform.
We've handed out nine balloons so far this week. Now, the single red so far looking pretty good on today's list. Comcast, the largest U.S. cable company, which recently bought a controlling stake in the broadcaster NBC and Comcast says, it's seeing a rebound in a crucial sector, which is advertising. Aerospace and defense giant, Northrop Grumman, which is seeing a rebound in mostly all of its units. JetBlue, a U.S. based budget airline. Analysts had expected the profit from the firm, but it was a challenging quarter for all the carriers. And Bellwether for the leisure set, Royal Caribbean International Cruise Lines.
Let's bring Maggie Lake now. Maggie, any reds out there? Any reds with the first one, Comcast?
MAGGIE LAKE: Yes, it's certainly not with Comcast, Max, and as you could see from the balloons, there's a real trend developing here. Comcast coming out with very nice looking results, profits were up. Some 12 percent sales profits, all beating expectations.
They added more than a million new customers and as you mentioned and this is really the point that we found interesting, advertising sales growth 24 percent. That's a good looking increase and that really is implications, of course, beyond Comcast.
It was so beaten down, that affects all media spaces so that's a good sign for the overall economy as well as for Comcast so a nice looking green.
FOSTER: OK, green goes in. It's getting bigger all the time. Kind of run out space in that one. Our next company, Northrop.
LAKE: Yes, same situation, and the thing is, Max, not only are these companies beating expectations, in a lot of case - in cases they're beating by a wide margin and they're seeing double digit growth in profits. Look at that 21 percent growth in all units and they're raising their profit outlook.
So if you're an investor, that is just good news all around. They're certainly responding and once again, you know, a green balloon.
FOSTER: OK, Maggie, just before - we're going to put the green in, of course. But just before we come back (inaudible) U.S. Federal Reserve says it's leaving it's benchmarking (inaudible) rate unchanged just above zero. The best is we'll be scrutinizing the fed statement. Maggie decides on how she thinks the U.S. economy is fairing just briefly.
LAKE: Yes, absolutely and you know, we're getting all these good news from corporate America, but the fed watching all of the economy including the consumer balance sheets. So we really haven't seen some of these good news from the corporations (inaudible) to Main Street and the fed very (inaudible) and really, really worried about pulling away stimulus too soon - Max.
FOSTER: OK, I'm not trying to get you negative now about JetBlue because from what I can see there's a bit of negativity out there and it's going to come from that, but I want to see a red somewhere here, some of a bit negative today.
LAKE: That's right, we finally have something to put in the red container. JetBlue is going to get a red balloon. They lost money, but investors or analysts rather expecting a little bit of a profit from JetBlue instead they lost about $1 million. But analyst - a little bit disappointed. The problem here it was a bad winter for airlines for sure.
They had higher fuel cost (inaudible) especially if you look a year ago and remember they order pretty far out and none of us have to reminded about the horrible weather that was all over the world so it's a tough winter.
If you're going to find any good news in here, JetBlue is not alone. They have company. A lot of their rivals struggling and losing money in the quarter as well, but still bottom line, they lost money so they get a red.
FOSTER: They get a red so this is the first one. A moment celebrate in a way. OK, the last one, Royal Carribean, it's a Bellwether of it's own source, isn't it? You got a positive story, right?
LAKE: Yes, it is. They're doing good. I mean, I wouldn't say it's off to the races like some of the other areas that we're seeing, but slow and steady improvement, which is I guess, what you want to hear when you're talking about big (shares) right? $87 million profit. They're seeing a steady rise in bookings and they're very positive about 2010.
And the reason this is interesting is, you know, you don't have to take a cruise. We are talking about totally disposable income. When you try to figure out where the consumer is in this recovery, clearly, you know, they may still sound cautious, but if you're willing to put your money at a cruise, you got a little bit to give away. So that's a good news story for the consumer and for the economy.
FOSTER: Maggie, thank you. We really have a talk. Thank you for that. Now, we have results here in Europe from another member of our Q-25 index. SAP of Germany's, one of the world's biggest providers of software for business and it says, a net profit almost doubled in the first quarter hitting $510 million.
The profits (inaudible) the different story. Shares in SAP closed today nearly 3 percent lower, but here are the Q-25, we give it a green and it's (inaudible). Bill McDermott took over CEO or co-CEO of SAP in February this year.
I asked him to explain that big jump in profits and the markets reaction.
BILL MCDERMOTT, Co-CEO, SAP: I think the economic scenario with Greece and so forth might have more to do with the stock than the results of course, so I'm extremely positive about our company and we have a double digit gross story. All large regions of the world grew and the fastest growing markets, Brazil, Russia and India in particular doubled year over year.
And we also expanded on margins for shareholders so we're feeling very, very positive about our company.
FOSTER: Emerging markets again driving growth in global corporations and you're a typical example of that. What are they buying into and what levels are they buying?
MCDERMOTT: These emerging markets, many of these clients are uninitiated. Meaning they haven't made investments on a business platform like SAP's yet. So some of them are new ones to business software and that's why our small and mid-size business is growing in significant double digit territory.
The larger ones need to expand beyond their borders and many cases want to access the global economy and making move either into a new industry, potentially into a new market and the agility by which a company can execute depends in large measure on their business processes and of course, their business software.
That's why SAP is the undisputed market leader and that's why we grew double digits strongly Q1 of this year.
FOSTER: I've just seen as a barometer of the global economy, you're results may be a (inaudible) other companies results, so what's your outlook looking ahead? Do you expect this sort of growth to continue? And if it does continue, is it going to be a similar pattern? Those developing markets doing really well.
MCDERMOTT: You know, we reiterated our annual guidance today so we expect our company to continue to do well in both mature and emerging markets. What's happening today is there's a convergence between business and IT. The business executives need to grow their companies again and they need to do that in a global market place.
The IT leaders need to make it more simple for these business executives to execute the plan so you're seeing the alignment of strategy, IT and business impact come together and it's converging all at once.
FOSTER: Is the recession over?
MCDERMOTT: I believe we're into a moderate recovery that you're going to see an uptake. This business optimism for example and a need that has begun now even mature markets like Germany, U.K. and France, you're seeing this.
In mature markets like the U.S., you're seeing more optimism than perhaps Europe at this time and the faster moving markets, Latin America, Asia as examples, there is really good optimism. So I believe that the recession to a large extent is going to moderately recover from here.
And best business brands like SAP that are truly global, truly customer driven will disproportionately benefit from the uptake in the global economic scenario.
FOSTER: Well, that's the view from SAP. This is a view from the Federal Reserve. (Inaudible) on the show that they're going to keep rates on hold at record lows, but the indication is they're going to stay at that rate for some time.
But there is more confident feeling to this latest common (inaudible). The job market is beginning to improve says the fed and they also note the consumer spending has picked up. So a bit brighter than the last fed meeting in mid-March and we'll bring you more on that actually as we go through the day.
Now, miles from home, not too far to care about politics. A British expat in Abu Dhabi gives his verdict on next month's election and tells us why it's still votes for life abroad.
FOSTER: OK, welcome to Quest Means Business. We're going to take you to the newsroom right now and get the very latest from there with Fionnuala Sweeney. Hi, Fionnu.
FIONNUALA SWEENEY: Hello, Max. Thailand security forces opened fire on antigovernment protesters today outside Bangkok. Eighteen of the so-called Red Shots were wounded. Only one soldier (inaudible) apparently from friendly fire. Antigovernment demonstrations have paralyzed the city for weeks.
The prime minister has refused to bow in demands for new election. At least three people were killed Tuesday evening when insurgence struck a NATO support compound outside Kandahar, Afghanistan. The Taliban say one of their suicide bombers carried out the attack. Kandahar is to be the front line in an upcoming offensive by NATO and Afghan forces. The goal is to push Taliban fighters from south eastern stronghold.
A second plane is being directed to a U.S. airport because of a bomb scare. The Transportation Security Administration says the plane heading from Texas to the Washington D.C. area is rerouted to North Carolina. Officials say a threatening message had been written on a mirror in the plane's bathroom. The TSA has yet to say if anyone has been arrested.
Yesterday, a Paris to Atlanta flight was diverted to Main after a passenger claimed he had explosives on board. (Inaudible) by Britain Prime Minister Gordon Brown had to apologize to a woman he met on the campaign trail after an open microphone (inaudible) calling her "bigoted."
The woman had challenged the prime minister on immigration policy at a public meeting. The misstep could prove costly for Mr. Brown's party (inaudible).
And those are the headlines - Max, back to you in the studio.
FOSTER: Thank you very much, Fionulla. Well, it's just over a week until Britain goes to the polls and the world is watching. The big promises, the big debates in big blunders, could be what sways voters here and what about Brit's living abroad.
We caught up with an airplane pilot. He lives in Abu Dhabi. Let's get a sense of the view from the Middle East.
JAY POWER, AIRLINE PILOT: Starters, it's sunny every day. We've got very nice life here, and we're probably earning similar amount now (inaudible) as we were. Both of us work in the U.K. If anywhere in the world right now is recession proof, it's probably Abu Dhabi.
But it doesn't mean it doesn't matter. We're always be British and we always care about what's going on there. Everybody seems to be talking about winning stuff like less taxes and more spending. But I don't know how that can work where there's actually less money in (inaudible) in the first place, and the country is broke. What they needs is more taxes and less spending.
Britain seems to be in a bit of crisis and I don't see that any of the major policies - none of them seemed to have a real vision for how to get out of the crisis now so move forward for the moment. Well, Golden Brown got into this state, but I think he's probably the best person to get us back out.
David Cameron, he's publicity (strike), but I'm not sure there's much substance to it. Only time will tell.
FOSTER: And we'll find out next week. Now sliding debt ratings, falling share prices and now the threats of more strikes. Just ahead how Greece's debt crisis is spreading beyond its borders and beyond the market. This is Quest Means Business.
FOSTER: Welcome back.
I'm Max Foster in London.
And this is QUEST MEANS BUSINESS here on CNN.
Let's return now to our top story, the effort to contain the Greek debt crisis before it engulfs the Eurozone.
Germany's chancellor, Angela Merkel, has said Germany will do its part as long as Greece also commits to turning its economy around. The breakthrough came after a meeting be Merkel and the heads of the International Monetary Fund, the European Central Bank, the World Bank and the OECD.
(BEGIN VIDEO CLIP)
ANGELA MERKEL, GERMAN CHANCELLOR (through translator): We talked about mainly about how -- how can we work against the international crisis. When we met before, there was nothing about this crisis. But now things have changed. The goals and the points are more precise. And we realize that we need a clear and coordinated working together.
(END VIDEO CLIP)
FOSTER: Well, John Defterios is joining me to pull all this together.
When she talks about the -- the sort of things that Greece has to do, how severe is it?
JOHN DEFTERIOS, HOST, "MARKETPLACE MIDDLE EAST": Well, number one, that's quite a change, because she's back at the bargaining table after the pressure from France. But very severe cuts. I was on the phone with some people that are involved in these negotiations and the talks. Twenty percent permanent staff cuts across the government. Twenty percent. It's quite severe.
FOSTER: A fifth.
DEFTERIOS: Yes, a fifth of the -- of the -- the workforce there who are taking the 14 month pay not down to 12, but perhaps negotiated down to 13 months. And then we have to remember that tax increases are going to slow down growth. So perhaps a contraction of 2, perhaps even 4 percent, in 2010.
So the painful work begins. A lot of pressure on the prime minister, Papandreou. I remember talking to him over at tea in Davos. And he talked about being prepared for this -- pretty Zen-like about what has to happen. Perhaps it helps that this is a showdown, in a sense. The IMF coming in and saying you have to negotiate something, we have to move forward in order to get this, you know, debt package pulled together.
Some other people I spoke to today down in Athens were saying that, look, this is positive, because they're not talking about one year or a $45 billion loan package. They're looking at restructuring $40 billion for next year, $40 billion for 2012 and stretching it out. Perhaps this is a long-term solution. That's the net positive, if they can get it done.
FOSTER: Yes. And so positive in the long-term, but in the near-term, extremely painful and tense.
DEFTERIOS: Yes, very painful. A couple of things that we should watch out for. We saw S&P downgrade, of course, to -- to junk bond status for Greece. We have to watch out for Moody's and Fitch, because by ECB rules, if you have another two go down below investment grade, then lending to Greece is going to be very challenging by the -- the rule book, the law book of the European Commission today.
The second thing is the capital scene in the country, we had 10 percent of the deposits leave the country in January and February. Again on the phone today, I talked to another person who said there's a report down in Greece saying another 10 billion euros came out in the month of March. I was on the phone with another family yesterday who said they were looking to take their euros out of the country because there's a concern about Greece exiting the euro.
Another businessperson I talked to said that's absolutely not something Greece wants to do, even though it would solve the export problem. But it would balloon their long-term debt because they would have to devalue their currency. That is not an option, as they see it today.
FOSTER: At a micro level, then, what are those businesses saying about themselves?
DEFTERIOS: Yes, this is a -- this is very interesting, because it's a -- a big challenge. And one quote from a person I spoke to, a CEO of a company down there, today: "Better a showdown for Papandreou with the extremist elements of society" -- about 6 to 8 percent, the protesters that you see on the street." "Better a showdown today than the slow death of Greece."
So that's how they see the two options today. We've got to get it done. We need to restructure the economy. The cuts will be extremely painful for the next year or two.
But can we look long-term?
And while you're doing this, in terms of the government cuts, can you take the painful measures and start to liber -- liberalize the economy?
Two hundred fifty billion euros of real estate assets that the government holds -- can you open up that sector?
Can you open up the construction sector?
Can you open up the transportation sector?
These are all sensitive subjects. But this business...
FOSTER: Find money where you can find it.
DEFTERIOS: If you can do it, take that money.
DEFTERIOS: But also restructure at the same time.
FOSTER: John, thank you so much for that.
DEFTERIOS: Thank you.
FOSTER: Now, keeping a promise to the Muslim world -- the U.S. president puts business center stage at a summit in Washington. We ask one of the -- the delegates if this was the opportunity that he had been waiting for.
FOSTER: Now, the U.S. president has devoted much of his time this week to reforming business at home. But he also found time to host a two day summit designed to support business in the Muslim world. Over 250 people from over 50 countries attended the Presidential Summit on Entrepreneurship.
One of them was my next guest.
Baybars Altuntas is from Turkey.
And he's the founder of the Middle East Entrepreneurship Institute.
And he joins me now from Washington.
Thank you so much for joining us.
How did it -- how did it go?
I mean did he -- was President Obama a powerful presence in this meeting?
BAYBARS ALTUNTAS, FOUNDER, MIDEAST ENTREPRENEURSHIP INSTITUTE: Yes. Yes. And the meeting was really beneficial, first of all. It created an excellent platform for a great network amongst the Muslim entrepreneurs. And we also made many meetings with our American entrepreneurs. So I think as Mr. -- President Obama stated in his cover speech, a very good new beginning was launched with the summit.
FOSTER: Is there such a thing as a global Muslim business community?
Do you share similar ways of working?
How does that work, exactly?
ALTUNTAS: To be honest, the summit highlighted a really important resemblance between the Muslim entrepreneurs and American entrepreneurs.
But on the one hand, there were also very interesting points that we brought on the table. For example, McDonald's has 5,000 branch offices all over the world. And McDonald's is an entrepreneur saying I have 5,000 branch offices all over the world and I am proud of this.
But, on the one hand, in Turkey and in Middle East countries, unfortunately we see still -- we are still facing with some restaurants or textile companies and saying we don't have any branch office anywhere in the world. And this entrepreneur is also proud of this.
So those two different mentalities came on board and we all talked and shared our know-hows about the business during the summit.
FOSTER: President Obama, of course, wants to effectively make money from this, doesn't he?
He wants to increase America's trade with the world.
Do you think that's likely from this meeting?
ALTUNTAS: Yes. And $2 billion. Mrs. Clinton stated at -- at her closing speech of the summit and there were many entrepreneurs among the Muslim countries will benefit from that plant (ph). And basically, that $2 billion plant (ph) is going to finance the new business ideas of entrepreneurs, not just in America, but all over the world.
FOSTER: OK. Thank you so much for talking to us.
Baybars Altuntas, thank you for joining us from Washington after that summit.
Right. And we're going to get a weather update for you now.
Guillermo is at the Weather Center -- hi, Guillermo.
GUILLERMO ARDUINO, CNN METEOROLOGIST: Max, hey. I was checking out the changes that we see here, the latest changes, especially in Britain. It's turning mild and it's turning damp in here. So we're going to see some more rain. It's because things were nice and warm for a while. Now things are changing.
Compared to what we saw in Scotland yesterday, the South looks better. Scotland looks a little bit better. But things with this high were very nice, indeed, not only in terms of temperatures. It feels like summer in many spots. People in Germany, in Berlin, were by the lake enjoying the sun. But now, as this high moves a little bit away from it, it allows the systems to go through the north and bring some precipitation.
And also, if you think that you -- you are done with snow, that's not the case for Norwegians, especially in the north. So we see some action there.
So this is the forecast for the next two days. We're going to see gray clouds. Then we're going to see an increase in humidity. And finally, the rain showers.
So for the next three days or so, London, you're looking at rain; also, the coastal parts will see winds in here. There are no -- there's not a high number of alerts posted right now, except for Italy, where we see some thunder in the forecast. That's about it.
But you see, at these airports, we do not expect any disruption from the point of view of weather. Some clouds in Milano. Rome appears to be OK. Then Copenhagen, maybe the rain showers. The same thing that is affecting parts here of the north. You see how the weakness or the -- the moving away of this low is allowing clouds to go through in the northern sections.
The West Med and Central Med are going to be fine. And we also see the economic crisis in Greece, there are a lot of offers right now to take some cruise -- cruises here in the East Med. So I'm going to be looking at that.
Temperature-wise, we're doing fine. Twenty the high for Thursday in Athens; 25 in Paris. We may see some rain showers.
So, look, the Greek isles appear to be OK. The Aegean Sea here, the Mediterranean Sea looking fine. A couple of clouds. So all those cruises are going to be fine. In coastal parts of Turkey, anywhere from Antalya, maybe some thunder at the beginning of this time period. But then it will be improving. The same into Cypress -- you know, some clouds and that's about it.
And if you're watching from Australia right now, good morning. You see things are turning a little bit cooler. I see that there is rain in Melbourne, drizzly conditions in Adelaide, as well. In general, we see high pressure, also. Not so nice in New Zealand. A little bit later for you guys, but we're not going to see nice weather conditions. And these are the highs that we see. But don't get misled, because early in the morning and let -- late at night, the contrast -- the temperature contrast is significant.
So we're talking about like five or six degrees maybe in Cambria and now getting all the way to 17, if we look -- which looks fine. But be careful because some of the time over here when you may catch a cold because you don't go out without a sweater. So bear that in mind. Thirty- two for Darwin and Sydney at 34 -- Max.
FOSTER: OK, Guillermo.
Thank you very much.
ARDUINO: Thank you.
FOSTER: We're going to have a look at the big board now. We're going to have a look at the Dow Jones and see what it's doing.
It's up about 65 points, as you can see. Actually, the market has been rising in the last hour or so, since we had the results of what -- we had news from the Fed saying that interest rates aren't going to change. And they're not going to change any time soon. But, actually, the commentary around that was quite positive about employment, for example.
So that's been a positive indicator on Wall Street today. It actually started quite AUDIBLE) there because of concerns about Greece. And that takes us to Europe, because the European stock markets tumbled for a second day over those growing doubts that Greece will be able to pay its debts. Those doubts are now infecting other Eurozone nations.
Spain's credit rating was cut one notch today. Portugal's credit rating was also lowered on Tuesday and Greek bonds have been downgraded, unsurprisingly, to the level that investors regard as junk.
That is QUEST MEANS BUSINESS for this Wednesday.
I'm Max Foster.
"MARKETPLACE AFRICA" is next.