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QUEST MEANS BUSINESS
More Details of bin Laden's Last Moments Emerge
Aired May 3, 2011 - 14:00:00 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: That is Jay Carney, the White House press secretary there, giving the second day of briefing following on from the killing of Osama bin Laden.
And lots of extra detail, if you like, on what has happened. For example, we now know where bin Laden and his family were in the compound, on the second floor and third floor. Lots of detail about how they were rushed by the special forces and a firefight took place.
Much discussion about the extent, who was armed and who wasn't, but Carney very clearly saying it was a fierce firefight. Although bin Laden, himself, was no-was not armed.
Good afternoon to you. I'm Richard Quest here at the New York Stock Exchange, where we consider coverage on this story from all angles. And today, QUEST MEANS BUSINESS comes to you from the New York Stock Exchange.
The death of Osama bin Laden is changing the way the American people see Barack Obama. A CNN poll conducted on Monday is showing 67 percent of people questioned approve of the president's handling of terrorism. That is up 7 points since January. Now the approval rating on his handling of Afghanistan is also up 7 percent to 58. His overall approval rating stands at 52 percent, which is up 1 point from the weekend. And up 4 points since January.
According to the latest polls, as well, notwithstanding the greater approval for the president, more Americans are now expecting there will be a terrorist attack on their home soil within the next few weeks. It is the highest level since anytime since the Iraq war in 2003, in spite of the claims that bin Laden's death makes the world a safer place.
As we put this into perspective many Americans here, of course, have much other concerns, not lest of which the economy. President Obama will now try to ride the wave of optimism that comes about as a result of the death of bin Laden, through Congress and try to deal with other intractable problems. On this program tonight we are going to talk about the debt issue and how the U.S. president aims to deal with that.
As the administration prepares for an epic political battle to deal with the debt problem the budget, Treasury Secretary Tim Geithner is looking to buy time with extraordinary measures. Extra time would give Republicans and Mr. Obama's Democrats time to deal with the debt ceiling. That will be done in the coming months to prevent the U.S. from what some say is the unthinkable, which is, of course, debt default. But with the U.S. burdened under a decade of debt, Republicans are threatening not to raise the ceiling. If they do that it is effectively turning the Bunsen burner up under the budget process. So, as lawmakers get back from a two- week break, the U.S. Treasury secretary is holding swords over various heads.
Next, federal pension funds, the Treasury could stop reinvesting in mid-May. Barack Obama says the death of Osama bin Laden should help forge a common national purpose.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I know that unity that we felt on 9/11 has frayed a little bit, over the years, and I have no illusions about the difficulties, the debates, that we'll have to be engaged in, in the weeks and months to come. But I also know there have been several moments like this during the course of this year, that have brought us together as an American family; whether it was the tragedy in Tucson, or mostly recently our united response to the terrible storms that have taken place in the South. Last night was one of those moments. And so tonight it is my fervent hope that we can harness some of that unity, and some of that pride, to confront the many challenges that we still face.
(END VIDEO CLIP)
QUEST: The president speaking, of course, a couple days ago. Now, the question that everyone need to ask is what affect the death of bin Laden has in terms of allowing the administration to get through its other policies; policies that until now have been bogged down in political wrangling. A short while ago Jim Boulden spoke to Mohamed El-Erian of PIMCO out on the West Coast, one of the largest bond dealers in the United States, and he asked Mohamed El-Erian what he thought, did the death of bin Laden change anything in the political game of Washington?
MOHAMED EL-ERIAN, CEO, PIMCO: The hope is that this renewed sense of unity, common purpose, achievement, pride, however you want to label it, but the hope is that Mr. Obama can translate this into progress on a number of economic issues that have been stuck in a very polarized Washington, D.C. That is the hope. The reality is going to be tough. It is going to require a tremendous amount of leadership on his part. And it is critical that he gets moving quickly, before this moment starts evaporating.
JIM BOULDEN, CNN FINANCIAL CORRESPONDENT: Would you agree, as many people, then, that debt is that number one issue that they need to tackle and maybe he will only get one bit of the cherry as it were. And this might be the one issue that could transform the debt discussions now?
EL-ERIAN: I would put unemployment at the same level, or slightly above that. So, I don't think that is both necessary and sufficient to change the outlook for the U.S. I think the unemployment problem which I call a crisis, is as important. I think you can wrap both of these things up, in the same issues. It is about improving the functioning of the economy. It is about dealing with the housing issue and it is about dealing with both the expenditure and the revenue side of the budget. So, I would put the budget and employment right up there.
BOULDEN: You say unemployment, but what can the president do, really? I mean, it is about small companies trading jobs?
EL-ERIAN: I think there is growing recognition that today's unemployment problem in the United States is increasingly structural in nature. If you look at the numbers, about a quarter of the 16 to 19 year olds are unemployed. The longer the youth is unemployed the more unemployable they become. You have 6 million new Americans that have been unemployed for more than six months. If you look, there are so many numbers that suggest that this is a structural issue; which means that you need progress on structural steps. Otherwise we are going to try to deal with the budget with a smaller share of the working population carrying the burden of the economy. I just don't see how you can avoid dealing both with the budget and with employment at the same time.
BOULDEN: If you are dealing with employment issues does that not actually increase the deficit, and therefore increase the debt?
EL-ERIAN: No, on the contrary, you can do it in a way that actually reduces the deficit. The reality is that in order to raise taxes, in order to collect tax revenue you need people working. And you need people to pay their tax bills. If you don't start addressing the structural component of unemployment, the tax base in the United States is going to be reduced once and for all, for quite a bit. So, you can do it in a way that is complementary. They don't need to be substitutes.
QUEST: Mohamed El-Erian, of PIMCO, talking to Jim Boulden a short while ago.
We need to put today into perspective of the markets. With me, well, Alison Kosik needs no introduction.
ALISON KOSIK, CNN FINANCIAL CORRESPONDENT: Hello, Richard.
QUEST: Hello, Alison.
Now, look, I can read, as you-well, you do the numbers for me, just-
KOSIK: OK, we'll do the numbers. The Dow, right now, down 40. The Nasdaq off abut 35. You know, the markets are lower. But you know what, we were talking about this earlier, about this disconnect between what is happening here in the markets, and what is happening at home. I mean, you look at the 12 month figures for the Dow, the Nasdaq, the S&P. The Dow and Nasdaq up 16 percent for the 12 months. The S&P up 14 percent. I mean, the markets really robust and you can thank earnings for that.
QUEST: OK, but that disconnect, that is taking place, and the way in which the markets are roaring head, it does seem slightly perverse. Because-I mean, at the end of the day the U.S. economy is only growing a couple of percent.
KOSIK: Exactly. And you know what you have to thank for it? The weak dollar, the weak dollar is what is powering corporate profits at this point.
QUEST: With overseas activity.
KOSIK: Exactly, but it doesn't help the consumer at all. Because you know what happens? The byproduct of the weak dollar is higher commodities. We are seeing it when we go to the grocery store. We are seeing it when we fill up our gas tanks, at the gas pump. And this is where Americans are really feeling it. The reality for Americans is we have a depressed housing market, we have unemployment, 13.5 million people are still out of work.
QUEST: But if that is the case, then all the amount-then this disconnect gets bigger. The American people feel more disconnected, and the markets become somewhat of a frolic of their own.
KOSIK: Exactly. And that is why you see volumes, the amount of people trading is it so low these days, because people first of all don't have the confidence. Secondly, they don't understand what is happening. They see the markets charging ahead. And then they look at themselves, their housing values are down, many people out of work. And so, yes, that is the disconnect that I'm talking about.
QUEST: When we come back in just a moment we are going to be talking about the New York Stock Exchange. And the Deutsche Bourses and the Nasdaq. We are going to be talking about that in a second.
But, Alison, you have always said you thought the winner was going to be?
KOSIK: Deutsche Bourse, but you never know.
QUEST: Are you still sticking with that?
KOSIK: I'm sticking with it, but now I'm kind of wavering a little more. But really I am thinking Deutsche Bourse will win in the end.
QUEST: All right. Alison Kosik joining us. Lovely to see you, as always.
KOSIK: Thank you.
QUEST: Now when we come back in just a moment. It is quite a rare event when the place which issues the shares and lists the companies becomes the victim itself of, of course, a hostile takeover bid. But that is the Big Board for you, in 2011. QUEST MEANS BUSINESS at the New York Stock Exchange after the break.
QUEST: Hello, I'm Richard Quest, QUEST MEANS BUSINESS, live from the New York Stock Exchange.
This is CNN. And on this network, the news always comes first.
Let me update you with the latest developments. And it concerns the surgical raid on Osama bin Laden's hideout, which has led to an intelligence windfall. A senior U.S. official is telling CNN 10 hard drives, five computers and more than 100 storage devices were taken from his compound in Pakistan. Investigators are searching for data for clues about all al Qaeda's operations.
The White House has revealed bin Laden was unarmed when he was killed by commandos. The press secretary, Jay Carney, said a short while ago bin Laden's wife charged the troops and was shot in the leg. He said no decision has been made to release a photo of bin Laden's corpse. He said it is a gruesome image that could be inflammatory if released to the public.
Turkey's popular prime minister is telling Moammar Gadhafi to leave power. Prime Minister Tayyip Erdogan says the Libyan leader must do so immediately to fulfill his historical and humanitarian responsibility. Turkey has already shut down its embassy in Libya and evacuated personnel from there.
Officials in Mexico say 14 miners have been trapped inside a mine shaft after an explosion. It happened just outside the town of Sabinas in the heart of the country's coal mining region.
Today, the program comes live from the New York Stock Exchange. It is the center of the financial world -- well, all the people here certainly think it's the center of the world here. But there's no denying what they believe. But this place is the center of a global transatlantic tussle for who gets control and who owns the New York Stock Exchange. NASDAQ, the -- the new upstart, says it is taking its offer for the big board straight to shareholders. It is desperate to outbid its competitors for control of the big board and has now gone hostile with its $11.3 billion offer.
The big board is still intent on merging with Deutsche Boerse instead. That has angered some of its shareholders, as that deal is only worth around $10 billion.
Deutsche remains committed to the merger and insists it's still the better option. It says the NASDAQ offer would burden shareholders with irresponsible leverage, eliminate a competitor and face insurmountable anti-trust risks.
Those kinds of legal sets throw another spider into the works of what's already become a messy take over deal.
C. Evan Stewart is a partner at the law firm of Zuckerman Spaeder.
He joins me now.
Mr. Evan Stewart, if we look at this deal, it is unusual that the big board itself should be the subject of a hostile bid.
But how likely is all of this to end up in the courts?
C. EVAN STEWART, ZUCKERMAN SPAEDER: I think that's unlikely. I think what's going to happen is at some point you're going to have the musical chair game end and the -- the financial deal will be what it is.
But that's not the end of this story, because then and only then will you have the anti-trust regulators, either in Europe or the United States, then have their opportunity to weigh in on the appropriateness of the deal. And, of course, at that stage, everything could come unraveled again.
But it's -- I think it's unlikely that this will go into the courts...
STEWART: -- in Delaware or some other place.
QUEST: OK. But do you then believe that this is destined one way or the other to founder on an anti-trust issue?
STEWART: I don't. I think the anti-trust issue that the stock exchange has identified is truly a unique one, because while it's true, if NASDAQ takes over the NYSE, there will be one -- essentially one place to list in the United States, there's really no injury to consumers as a result.
So when the stock exchange says there are, quote, "insurmountable anti-trust issues," I'm not sure I agree with that analysis and I'm not sure any other anti-trust lawyer really does who is neutral on the subject.
So I -- I think that possible merger between the NASDAQ and the stock exchange really is unique in -- from an anti-trust perspective.
QUEST: OK, putting that all together, and we look at this, we know, for example, Singapore and Australia, that was blocked by the Australian treasurer. Now, we see this one is also going to be, in some cases, necessarily enmeshed in anti-trust.
Is it inevitable, though, that these exchanges are going to come together in some shape or form, bigger is going to get better, perhaps the best?
STEWART: There's no doubt the consolidation is going to continue with respect to stock exchanges. There's no doubt about that. But the Singapore issue you mentioned really floundered not on anti-trust issues, but on political and geopolitical issues. And, of course, that has a -- a factor here with respect to the stock exchange as well as people like Senator Schumer and others have made clear, ownership, percentages, the name, things of that sort, are factoring into this deal, as well.
QUEST: All right, Mr. Stewart, many thanks, indeed.
STEWART: Thank you.
QUEST: We appreciate that.
STEWART: Thank you.
QUEST: We know this is one that's going to run and run in the days ahead. There's still more mileage. Look, we're not going to talk about the merger as such, who will win the battle for the beauty of the stock exchange, well, that really is a matter for another day.
But the battle of the beauty for Kenneth Polcari is most certainly for the moment.
Ken, come and join me in the middle.
We do need to talk about just -- I think the last 24 hours, 48 hours, obviously, starting with bin Laden, it -- it has resonated more here than perhaps most other places.
KENNETH POLCARI, ICAP EQUITIES: Well, yes, it was very personal to us here, especially, you know, to -- to the men and women down here in this part of Manhattan. Certainly the guys that -- the men and women at the New York Stock Exchange, but the people all downtown. You know, what we witnessed that day, what we felt that day, what the event was like and has been like, actually, for the last 10 years.
And so it's -- it is very personal to us.
QUEST: When you look at what happened, would you say the majority of people now here believe things are safer, things are better, things are OK?
POLCARI: I think that they would believe that things are safer, certainly around this building and down in this area.
But from the global perspective, are they safer?
I think it's a changed world. I think everybody realizes it's a changed world.
QUEST: How did it change, though, as a -- as an American and as a -- as a person on the New York Stock Exchange, how did it change?
POLCARI: Well, listen, terrorism, right, came to our front door...
POLCARI: -- when it came over here, you know, 10 years ago. It was something that Americans had never really experienced. It happens in other parts of the world. And, you know, we, as Americans, never really understood that, how -- I mean I, for one, never really understood it. It came right to our doorstep.
QUEST: We need to turn subjects, because there's so many issues that we need to get to grips with.
Let's talk on economic matters.
QUEST: Now, bin Laden may be dead, but the U.S. economy is in by no means good -- good fettle at the moment, is it?
POLCARI: No, that's right. It's still -- we're still struggling along. We're kind of bouncing along the bottom and we're -- and we're -- and we're struggling. And we are yet to be out of this. And we can see, the market has gotten well ahead of itself, although, it's kind of churning.
QUEST: Well, ahead of itself, that's an understatement. It's lost -- it's lost touch with reality.
POLCARI: Well, and I would agree with you. And that's why I think the last couple of days, specifically when, you know, we're into May now. April is over. And we saw this -- this real surge at the end of April, which a lot of people didn't understand.
And I think what you're going to have in May, you're going to see this retrenchment and you're going to see this kind of pullback. People are getting ready for the end of QE2. They're getting ready for what the new normal may look like, whether or not there will ever be a QE3.
And so there's a lot, a lot of uncertainty out there.
QUEST: Have you ever believed in the old saying, sail...
POLCARI: In May and go away.
QUEST: Sail in May, go away.
POLCARI: And -- and, actually, this May it might be very, very true on that, because come June, we're at the end of QE2. So, in fact, it may be the right -- that might be the right cliche.
QUEST: He's showing his age if he remembers that old saying.
It's good to see you again.
POLCARI: It's good to see you.
QUEST: It's nice to talk -- nice to see you.
The old saying, of course, for those of you not too familiar with it, the old saying of the stock exchange, sell in May, go away. But I'm not sure whether anybody ever did that.
This is how investors outside of the United States fared when they did their deals and saw their Tuesday.
The European markets fell off slightly. The exception in the FTSE, which was playing catch-up after being closed for a bank holiday.
A more mixed picture in Asia. Two in the region decisions to brief you on. The Federal Reserve Bank of Australia, they kept rates on hold, but their Indian counterparts increased rates by 50 basis points, a bigger hike than expected. The SENSEX fell almost 2.5 percent.
This place, the New York Stock Exchange, has had many changes, certainly in the 20 years that I have been coming down here. Just think, in 1987, when I first came to the Exchange, they would never let you on the floor if you weren't a member or a trader or a broker, let alone do a television program and broadcast live.
QUEST MEANS BUSINESS on the floor of the Exchange.
QUEST: A gentlemen at a machine is making an awful lot of noise.
Who knows whether it's buying or selling or just playing a video game?
It's QUEST MEANS BUSINESS live from the New York Stock Exchange.
Good evening to you.
I'm Richard Quest.
Look, listen, air passenger number growth is waning, according to the latest numbers from IATA. According to IATA, it says international passenger numbers rose 3.8 percent in March, compared with the previous year, down from 5.8 in February. Political turmoil, natural disasters are partly responsible. The Japanese earthquake and tsunami certainly gave cause for concern, as, indeed, did Egypt's political unrest.
A short while ago, the association's outgoing director general, Giovanni Bisignani, joined me via Skype to discuss these numbers and put them in perspective.
And I pointed out, whatever the reason, the fact is, it's disappointing the numbers are down.
GIOVANNI BISIGNANI, DIRECTOR GENERAL, IATA: The Middle East affected it on the cost side. We had a bill that increased by $30 billion because of the increase of fuel that went from $130 to $160 billion.
Japan itself was directly involved with the rev -- in the revenue side, because Japan represents $60 billion in revenues.
QUEST: Do you get any feeling that things will get better, because whilst Japan may improve, we know the days of cheap oil have gone?
BISIGNANI: Let's hope. Let's hope that nothing happens, because, you know, we were forecasting, at the beginning of the year, a -- a good result.
QUEST: Does the U.S. industry particularly, U.S. aviation, stand to suffer because of these measures?
Even though they've taken many changes, there's still a lot of -- some would say capacity in the system.
BISIGNANI: You know the problem is that we cannot adjust capacity with the -- with the same speed that those events are happening. So we need at least a three month buffer in order that we will reset capacity.
QUEST: Obviously, we're much concerned at the moment, with 9/11 and what happened there.
What do you think was the biggest single improvement and also the biggest problem that came for security from 9/11?
BISIGNANI: Since 2001, security has been completely transformed. We see in the cockpit doors, the new process at the airports. We have the passenger data collection. And we reinforce all our processes. Flying is much more secure, but it's a $7 billion cost, though.
Now, we have to be sure that those measures remain there and we cannot relax absolutely, but I think that the situation is much improved in the last year. Cooperation with homeland security has been very good in the last and so the enhanced, I would say, new security measures are much more organized around the world.
QUEST: Where do you stand, though, on this view that so much of the security, particularly in the United States, is just -- it's basically style over substance?
It's noisy, it's very much in your face, but questionable about its efficacy?
BISIGNANI: First of all, security has a cost, but has created also a pan -- a hassle for our passengers. We have to look ahead. We're using a security tool that has 40 -- is now 40 years old. We must implement new technologies. We are working on the IATA tunnel so to -- to try to connect the risk assessment to the passenger to a new way in which the passenger can be screened.
So it means going through a tunnel without having to take away the shoes, belts, the liquids. I hope that this could be a reality by in two years time. We are working well with Homeland Security and TSA. And there are certain kinds of prototypes already in testing.
(END VIDEO TAPE)
QUEST: Giovanni Bisignani, the director general of IATA, talking to me about the latest numbers showing a small decline.
The weather here in New York has been glorious bordering on excellent.
But the question is whether that is going to continue.
GUILLERMO ARDUINO, CNN METEOROLOGIST: No.
QUEST: Joining me from the World Weather Center to -- what do you mean no?
ARDUINO: No, it's not.
QUEST: You miserable.
ARDUINO: It -- it's going to rain and it's moving your way. But you know what, look back and enjoy what you saw before, because there's nothing we can do about it. It's not going to be terrible.
ARDUINO: The -- the problem, Richard, is in many areas of the United States, it's actually a very dramatic situation. You know that the -- the court -- the Army Corps of Engineers decided to blow up certain levees at the Mississippi River, especially to -- to flood one area of the Missouri side to save one town called Cairo. And, actually, this is a town that was saved because you see the river over here that was so overloaded with, on the one hand, the significant rains that we got before, and, also, a very snowy winter. So all that snow is melting down and we saw the -- the floods that continued to advance all over.
On top of that, as you see, we got up to 200 millimeters more. You see the major flooding stage for many areas, a big portion of the states, a huge area.
And, actually, as I was telling you, the -- they decided to blow up certain levees to flood, intentionally, farmland in order to save that town.
Let's show our viewers a little bit of the flooding and how bad it is. This is near that city that was actually saved. So imagine, in order to save people, they flood, intentionally, farmland. That is quite a significant area in the country.
And this is the system that is going to clear from that area, but the rain will advance, no matter, into the Eastern Seaboard. And that rain is what's -- what's going to hit New York later on.
For the time being, it's high pressure. You will see an increase in - - in the winds and so on and so forth.
Now, the numbers continue to be quite intense, associated with these rains that we see in the Midwest, advancing into the Northeast. But so far, we see only delays at Newark, right outside New York there, and jersey. And we see a ground stop right now until 3:30 p.m..
Temperature-wise, lovely, 22 in New York, 27 in Atlanta, on the other side of the country, Portland 11 degrees -- Richard.
QUEST: Many thanks, indeed.
The world weather with -- next time, please do better.
QUEST: Get sunshine all the way and certainly into the weekend when I'm back. Consider yourself duly warned there.
One piece of news that I do need to bring to your attention, News Corp, the media company owned by Rupert Murdoch, is -- now says it's mulling over a possible bid for Formula 1. News Corp is in the early stages of creating a consortium, an investment company Exor. The two companies are planning to approach the stakeholders in Formula One over the next few weeks, although both companies have stressed this does not mean that a bid will actually take place, but certainly this has been a rumor that has been around the market for some time. That rumor now turned into a fact, but a bid still not yet on the horizon.
The thought of Rupert Murdoch driving a Formula 1 car is probably enough to warm the cockles of many a heart.
When we come back in just a moment, the U.S. budget deficit is a problem, but is anybody seriously doing anything about it?
Maggie Lake considers that, after the break.
QUEST: The U.S. budget deficit is a serious problem. You don't need me to tell you that. But what we do need is Maggie Lake to try and tell us what's going to be -- nice digs here.
MAGGIE LAKE, CNN BUSINESS CORRESPONDENT: Absolutely, Richard.
And you're right, the budget very much on the minds of investors. But, you know, you know that New Yorkers have no shortage of opinions, happy to give advice. So we thought we'd go back out some people who actually have to cut for a living and see what they had to say about the budget deficit.
SANDY LEVINE, CARNEGIE DELI: Look at that. Look at that moisture on there. Look at that marbleization. Oh, God.
LAKE (voice-over): No cutting corners here at midtown Manhattan's famed Carnegie Deli.
LEVINE: We make our sandwiches one way and that's the big way.
LAKE: Where owner Sandy Levine shows off Carnegie's latest creation.
Across town, Adrian Wood is the owner of the legendary barber shop, Paul Mole. And downtown, at the City Quilter, ace fabric cutter Cathy Izzo.
With the U.S. budget deficit set to top $1.5 trillion this year, politicians need to cut and cut hard.
Can these three businesspeople with years of cutting experience show politicians the way?
For Sandy Levine, frustration with Washington grows by the day.
LEVINE: We're almost six months into the election and nothing has been done.
LAKE: He says take a knife to the most politically sensitive areas of the budget.
LEVINE: You've got to take a good look at our entitlements. I mean it's a broad area, it's a wide area. There's a lot of things that fall under that umbrella, whether it be Social Security, Medicare, Medicaid. You need a little bit of Sandy Levine to -- to kick a little butt down there.
LAKE: But at The City Quilter, where rows upon rows of fabric are turned into cozy quilts...
CATHY IZZO, THE CITY QUILTER: This is one using the subway fabric.
LAKE: Co-owner Cathy Izzo says entitlements should be the last thing cut.
IZZO: Social Security, no way. Medicaid, no way. But these are the people who need the help. These are the people who have given their lives to whatever, their country, their family, whatever. And now it's time to give back to them, not -- not cut. Cuts are important, but as any quilter knows, you have to make the right cuts out of the right fabric at the right time.
LAKE: At Paul Mole's on the Upper East Side...
ADRIAN WOOD, PAUL MOLE BARBER SHOP: Just a little trim, right, for the daughter's wedding?
UNIDENTIFIED MALE: Yes.
LAKE: Adrian Wood is willing to snip away at the safety net.
WOOD: I'd like to see things cut that from -- from the economy that maybe that people haven't paid into the system, maybe we could cut them first, you know, and -- and look after the people that have worked.
LAKE: His customer, Fordham University Vice President Orin Grossman, takes a diplomatic line.
ORIN GROSSMAN, FORDHAM UNIVERSITY: It seems to me, you're going to have to have some balance of tax hikes on the wealthy, maybe every -- maybe everybody has to go back to the pre-Bush cuts. But certainly the wealthy. And -- and then that's going to have to be, you know, they're going to have to -- I'm having a trim today, right?
GROSSMAN: Everybody is going to have to (INAUDIBLE). If everybody took a little hit, nobody would have to suffer enormously, that's my opinion.
WOOD: So, in other words, we -- we don't want to have a bad haircut day with this, right, you know what I mean?
LEVINE: A Danny Rose, a Woody Allen.
LAKE: Back at the Carnegie Deli, Sandy Levine, who names sandwiches after famous figures, throws down a challenge.
LEVINE: Here at the Carnegie, we will name a sandwich after any politicians who will come in and do like President Reagan and cut the deficit, put the country on the right track. We would use pastrami, corned beef, the basic stuff. No bologna and no tongue.
LAKE: Who says budget battles are unappetizing?
(END VIDEO TAPE)
LAKE: So, as you can see, we had a bit of fun with that. I'll bet everybody wants one of those sandwiches. But, very seriously, you can hear in there the problem that we're facing. Everyone is divided. Nobody wants to cut the benefits. Nobody wants to raise taxes. So you're at this logjam on dealing with this issue.
I talked to a trader today, he said right now, the markets believe that something will get done. But if we get the sense that that's not happening, it's going to be trouble for the markets.
QUEST: We're down 55. The gentleman over there says we're in trouble tonight. I think we may be in trouble over that.
Maggie, many thanks, indeed.
When we come back in just a moment, A Profitable Moment, as we try to perhaps bring together the strands of the last 48 hours.
QUEST MEANS BUSINESS.
We're at the New York Stock Exchange.
QUEST: Tonight's Profitable Moment from the New York Stock Exchange.
The U.S. economy is not out of the woods by any stretch of the imagination. All the economic barometers are flashing amber, with potential for worse to come.
There are problems galore which seemingly are bogged down in political gridlock and wrangling.
But the killing of Osama bin Laden may be regarded as a turning point and, economically, it could be an opportunity.
Good evening to you.
In solving some of these issues, it is very likely that the action taken by President Obama will be seen to be strengthening his hand, as he tries to deal with these other matters. It's replenished his political capital. It will give him the ability to do deals and, in some cases, win the day.
Remember, this is the president that got health care and financial reform through Congress. You mess around at your peril.
And that is QUEST MEANS BUSINESS for tonight.
I'm Richard Quest at the New York Stock Exchange.
Whatever you're up to in the hours ahead, I hope it's profitable.
I'll see you tomorrow.