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QUEST MEANS BUSINESS
Merkel's Message to Greece; Europe's Frequent Fliers; Greece's Next Move; Lackluster Week for European Markets But Good Year-to-Date; Watching Wall Street; South Korean Apple-Samsung Case Ends in Stalemate; Apple- Samsung Patent Battle; Dollar Up; Sustainable Business Winners
Aired August 24, 2012 - 14:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, CNN INTERNATIONAL HOST: From Athens with love. The Greek prime minster takes his charm offensive to Germany.
No winners yet in Apple versus Samsung, and consumers seem to lose out.
And as for brand Armstrong, is it resilient or rendered useless?
I'm Richard Quest. It may be Friday but, of course, we mean business.
Good evening. It is a simple message for Greece from Angela Merkel of Germany. Keep your promises, and keep your place in the euro. The German chancellor has given her support to Mr. Samaras on the condition he doesn't waver from the promises made by previous Greek leaders.
Samaras spoke alongside the chancellor in Berlin, and again he asked for breathing room as Greece pushes through a two-year austerity plan. Mrs. Merkel says she wanted Greece to stay in the eurozone and she made it clear there could be no going back on the austerity agreements that are already in place.
(BEGIN VIDEO CLIP)
ANGELA MERKEL, CHANCELLOR OF GERMANY (through translator): I want to make myself very clear. What is the expectation here? The euro crisis is dealing with a lost trust. This is not only related to Greece, but this is referring also to the entire eurozone. That's why we have to rebuild and earn back trust. And to earn back trust, we need to regain trust.
Therefore, I have made clear today that we absolutely expect from Greece that the promises which were made will also be kept and be implemented. That actions will follow their promises.
(END VIDEO CLIP)
QUEST: Now, that's Angela Merkel in Berlin. It has taken a whole week of bilateral meetings to get this far with Greece and Germany. And as you can see at the CNN super screen, Europe's frequent fliers are not over yet by any means.
On Wednesday, Jean-Claude Junker of the eurozone group went down to Athens for meetings. Samaras asked for extra time, "all we want are time to breathe." Junker said, "Well, we'll have to wait for the troika report," and Merkel agrees.
Then, on Thursday, Hollande -- let's get Mr. Hollande -- went to Berlin to see Chancellor Merkel, and they agreed that Greece must stay in the euro. Well now, Mr. Samaras has gone to Berlin and at the weekend, of course, he is going onto Paris.
What you have, of course, are leaders going backwards and forwards, meeting each other, trying to sort out that which will be done.
And the deadline for all of this has been changed and keeps changing, because that's when the leaders themselves head off down to Cypress, which is not quite on our map, but once there in Cypress for a European summit, and they try and put this whole thing together once and for all.
With the Greek prime minister's European tour almost complete, Greece now has a number of options to play with over the next few months. Jim Boulden is with me.
JIM BOULDEN, CNN INTERNATIONAL CORRESPONDENT: Once and for all, huh? You think they're going to get it all sorted, because this was a question - -
QUEST: What are -- what are the options?
BOULDEN: Well, the options --
QUEST: The options.
BOULDEN: Yes. To get it sorted, well, the first one is, actually, that the troika that returns to Greece in early September will actually go over the books, find more cuts for Greece, and then if Greece can meet the options, the troika approves to give Greece another tranche of money. It's a lot of money that Greece needs. We think maybe around mid-October needs that money.
QUEST: We know, Jim, that the austerity plan is already off track.
BOULDEN: Yes. It's not enough money yet, so they need to come up with around 4.5 billion more euros in order to get it back on the track.
So, the second one, that is it. More Greek austerity. In other words, billions more of cuts and tax rises if it can work. And if it's enough by the October time, then Greece gets the money.
What if Greece can't get the money? Well, there are two options, of course. One of them, the most important, I think, is that Greece could get more time as Samaras is asking.
Now, of course, right now, it doesn't look like that's going to -- be an option. But if -- if -- if Samaras can convince everyone that they are on the right track, that this technocrat is putting Greece on the right track, then I could see some wiggle room there for Mrs. Merkel.
QUEST: OK. Let's say he convinces them that he's on the right track and he needs the extra time. He's come up with this sophisticated argument that time is not money, basically.
BOULDEN: Yes. I've heard that. I don't believe that all.
QUEST: Of course it's not, because if he delays two years, then there's a two-year hole that has to be filled.
BOULDEN: Yes. And they have to pay all this money back anyway, and if that gap of two years -- in that gap of two years, he'll need more money from the IMF.
QUEST: Which, of course, he says he can get from privatizations and the like, but we'll wait --
BOULDEN: Well, people have said there isn't going to be enough privatization, that there's not enough tax collecting, that there hasn't -- obviously, when you have six years of recession, that there isn't enough revenue coming in.
So, if they get more time, which would help in the short run, in the long run, it means more money to pay back.
QUEST: Al right. So, that's the situation with Greece. But if you join me over here, and we take the status quo at the moment. Angela Merkel is still playing hardball and not quite sure what the end game is other than fiscal probity.
BOULDEN: For political reasons internally, of course.
QUEST: Internally. Francois Hollande, somewhere in the middle of all of this. But he's got his own arguments, and he doesn't want any more austerity himself.
BOULDEN: However, France needs more austerity, because the country isn't growing. And unfortunately, to meet their deficit targets, there are going to have to be some cuts in France.
QUEST: And Jean-Claude Junker trying to hold this whole thing together.
BOULDEN: Right, of course. And I think the October 18th meeting in Brussels is going to be the most important. That's when the leaders get together. I'm not worried about Cypress, I'm not worried about the meeting in a couple weeks --
QUEST: The other one in Brussels.
BOULDEN: They will all have to come to Brussels. Mr. Samaras will have to explain to them why he thinks they've done enough and please give us that next tranche.
The money's already been agreed, so it's not about finding new money right now, it's about allowing Greece to get that money so it can pay its bills.
QUEST: Have a good weekend.
BOULDEN: We're not going to stop talking about this for a long time, are we?
QUEST: Have a good weekend.
QUEST: As we wait for the verdict in the US Apple-Samsung patent case, a similar case ends across the Pacific. In a minute, we'll bring you the outcome and what it means for the rivals and how consumers will be effected. This is QUEST MEANS BUSINESS.
QUEST: Stocks in Europe had a lackluster end to the week. If you look at the numbers, it was mostly flat, and the indices are down for the week as a whole. Well, look at that, it doesn't get much more flat than 0, 0.3 and 0.02. It is the end of August, of course.
Over the course of the year, it's a more positive picture if you take the view from the year-to-date. Here we see a strong -- a particularly strong Xetra DAX, up 18 points -- 18 percent. But that, of course, is largely because it was so clobbered during the eurozone crisis of last year.
On Wall Street, investors are feeling more upbeat than they were when we talked yesterday, the Dow off 100. Deeper knees about the Fed and its stimulus package has been replaced with some hope that the central bank will step in.
QUEST: Alison Kosik is in New York and joins me. Alison -- we are in those last days of August when only a fool would make any wide -- not you, me, I mean --
QUEST: -- any wide-ranging, sweeping prognosis as a result of trading on a Friday.
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Well, exactly. I wouldn't do that. However, what a difference a day makes, right? You look at yesterday's session, the Dow ended over 100 points lower. It looks like we're 88 points higher right now, so it's sort of a wash in the two days.
And you know what the difference is? The difference is this letter. Did you hear about this letter that Fed chief Ben Bernanke sent to California congressman Darrell Issa?
Darrell Issa has sent Bernanke some questions, so Bernanke had answered them. And in these answers, he basically is saying that there is scope for further action by the Fed to ease financial conditions and strengthen recovery. Bernanke also said that the Fed's previous bond- buying helped to promote a stronger recovery than otherwise would have occurred. So, you look at this letter --
QUEST: Yes, but are you --
KOSIK: -- and you can argue --
QUEST: I looked at the letter --
KOSIK: -- you could argue --
QUEST: I looked at the letter, and I saw nothing in that letter that we didn't see in the Fed minutes.
KOSIK: You know what? But I would argue that this letter, Richard, is actually clearer. It's more succinct than some of the Fed's statement that we've seen in the past. Clearly it's not a promise of action, but you know what? Hey. On a slow Friday in the middle of the summer, analysts say it's enough to give the market a boost. How about that?
QUEST: I'll take that as a reason for the market to be up. Alison, thank you very much. I'm away for two weeks as of tonight. Don't do any damage while I'm gone.
KOSIK: So am I.
QUEST: Where are you off to, anywhere nice?
KOSIK: I'm off to the pool.
QUEST: I'll see you under the palm tree over in the corner. Alison Kosik. No, don't worry, before anybody starts any gossip or any rumors --
QUEST: No. Absolutely not.
As a jury debates in the US Apple-Samsung patent lawsuit, a similar case has just ended in stalemate 6,000 miles away. In South Korea, consumers lose out.
A court there reached and ruled each firm had committed patent infringements, and it's banning the sale of older Apple and Samsung devices, including the iPhone 3GS, 4, all of them, and tablets. Both firms were fined an average $28,000. The cases are completely separate and won't influence the American verdict.
I have now with me the actual decision that they have to reach and the questions they have to -- joining me is the patents lawyer, Ilya Kazi, who always helps us understand this. We'll talk about this piece of nonsense in a minute. Before we do, this South Korea case, if this a red herring?
ILYA KAZI, PARTNER, MATHYS & SQUIRE: Well, it's a separate matter, so we shouldn't focus on it too much as far as the US is concerned. It's going to be an annoyance for Apple that they can't sell a lot of their older devices, but it's not directly relevant to what's going on in the US.
And that large piece of nonsense, as you call it, is very relevant. The jury's got to decide on 700 questions and will have a lot of fun doing so.
QUEST: Oh, no, no, no. They've got to do more than just decide on 700 questions. If you found unregistered iPads dress-protectable and famous, for each of the following, has Apple proved a preponderance of evidence that Samsung Electronics telecommunications has diluted the registered iPad trade dress?
KAZI: Well, as I said to you a while ago when we were talking about this, a jury's got to decide on this.
QUEST: This is -- beyond the capability of most ordinary lawyers, let alone ordinary men and women of a jury.
KAZI: I think that's not an unreasonable thing to say. The jury's going to sit down and ponder that long document, and they'll be doing very well if they answer each question accurately and objectively and without losing the will to live.
QUEST: Has Apple proved that Samsung has infringed D305 patent? I mean, all right. The point is clear, isn't it? The jury has to answer these questions.
QUEST: And they probably will, because they've heard the evidence.
QUEST: And at the end of the day, they're probably going to answer these questions on the basis of gut feeling, aren't they?
KAZI: Yes. Probably. They -- I'm hoping they will consider the evidence, they will have been swayed by it. But they're human. That's the whole point of a jury.
And I don't now if you saw the judge saying we've got to go through these 109 pages of instructions and we need to stay alive during this, and we're going to have stand up to make sure we do. And it is optimistic, shall we say, that boredom will not set in while the jury are considering this. Now, they will deliberate for some time.
QUEST: We have a very different system in Europe, don't we?
QUEST: This would never -- obviously, it wouldn't go to a jury.
KAZI: It wouldn't be a jury.
QUEST: And it would go to a patent expert judge.
KAZI: Yes, that's right. For exactly that reason. This is very complicated. Now the judge, to be fair to her, in this US case has done her best, as you've seen, quite outspokenly to try and cut down the issues. But this is the net result, and this is the -- after a fairly rigorous judge saying let's simplify the issues.
QUEST: But the US has experienced patent judges as well.
KAZI: Yes. Yes. But the judge -- the US has an overriding principle that you should be tried by jury. Now, they've mitigated the system so that more complex technical issues are tried by a judge. But at the end of the day, this is coming down to a jury trial. And I think you're right to say that a jury may not go through as rigorously as a judge all of those questions.
QUEST: The jury is out. It's not a criminal matter.
QUEST: I have no hesitation in saying, how do you think it's going to go?
KAZI: I think the jury will deliberate and it is quite possible that behind the scenes there will be negotiations. And although both sides are standing firm, they might just decide to settle. Both sides have a lot to lose if this goes badly.
Apple, they're making $5 million an hour from sales of iPad. If they were to have that stop, that's a very bad result.
Equally, they're fairly aggressive if -- whatever this judge -- this judgment is, I don't think we'd be surprised if we saw an appeal, and I think it won't be the end of the story. So --
QUEST: A bit of light reading for you for the weekend.
KAZI: It's all right, thank you.
QUEST: I'll keep it. Thank you very much. Thank you for coming in and joining us.
Now, a Currency Conundrum for you. In the US, you can have a damaged dollar bill replaced for free by the Bureau of Engraving and Printing. Our question: how much of the note do you need to have left in order to get a new one, 51 percent, 66 percent, or do you need pretty much the whole note? We'll have the answer for you later in the program.
Now, the rates. The dollar's gained against most of the world's major currencies, $1.25 to the euro, up a fifth of a percent. The dollar is up a similar amount of sterling. These are the rates --
QUEST: -- this is the break.
QUEST: The winners of Ben & Jerry's Sustainable Business competition have been crowned. After a week of challenges and judging, which took place in Uganda, 15 Join Our Core finalists were whittled down to five winners that each received $12,500, featured on a special Ben & Jerry's flavor next year, and they receive mentoring for their business.
The UK-based Rubies in the Rubble was won of the winners. Now, Rubies in the Rubble turns excess fruit and veg into chutney and jams. This is their spicy tomato handmade chutney, which sells for about $3, $3.50. Not only that, of course, providing these jams provides work for struggling, those people finding a job.
The company's founder, Jenny Dawson, and Ben & Jerry's co-founder, Jerry Greenfield, both of them joined me and found the competition to be an inspiring process.
JERRY GREENFIELD, CO-FOUNDER, BEN & JERRY'S: It was incredibly exciting. It surpassed my expectations. The quality of people and the work they were doing and are doing is astounding, and it's actually more inspiring than I had ever imagined.
QUEST: Right. Because I -- one of the things I remember from our earlier discussions in this, it's one thing to be able to do good and be sustainable, but it's the importance of being able to scale it up, isn't it?
GREENFIELD: It is. But everything -- well, not everything, but most things start on a small level. And you don't always know if they will scale up or not or how it's going to happen. But that is no reason not to jump in with both feet. And that's what all of these social entrepreneurs have done.
And along the way, you find out the answers. Because when you start, I can guarantee you, you have no answers of how you might scale it up.
QUEST: And what did you learn from this process?
JENNY DAWSON, FOUNDER, RUBIES IN THE RUBBLE: The main thing I'd say is probably how business changes in location. In Uganda, they've got so little resources, and you realize as well no one's got disposable money. It's incredibly hard stuff for business. So, I suppose adapting business to your location.
QUEST: Jerry, are entrepreneurs born or are they created?
GREENFIELD: It's actually both. I used to believe that entrepreneurs were simply born, that there are certain qualities you need. Among them, a certain level of initiative, risk-taking. But there are actually skills that you can learn and acquire along the way of how to address things. It's certainly a lot easier if you're born with some of those qualities to begin with.
QUEST: Are you -- were you born, Jenny, with the ability to know business? Was there something inside you that you thought, "I can take these jams and chutneys and I can sell them?"
DAWSON: I -- I'd always thought I wanted a product, but I don't know if I was born with anything. It doesn't -- hasn't been any eureka moment. But I get some -- a lot of pride out of having something --
QUEST: You get a lot of pride --
QUEST: -- but do you get a buzz when you start getting the pot boiling or whatever it is you do?
DAWSON: Oh, I get a huge buzz out of it. There's something really nice about having a glistening jar, an end product, when you start with so many pieces.
QUEST: If somebody's watching, and they have a fleson (ph) of excitement about what we're talking, what would your advice be to them?
GREENFIELD: I would say two things: start small. No matter how grand your vision is, if you start small, you'll learn all the details of what you're doing. And also, pursue your passion and integrate your values into what you're doing.
The idea of having a business is not simply about making money. If you can combine your passion for helping people, making the world a better place, and turn that into a business, you are incredibly powerful with what you're doing.
QUEST: What would your advice be, when there's somebody watching, Jenny, in the nicest possible way, and they say, "Ha! Jenny and her Rubies in the Rubble. I can beat that."
DAWSON: I'd say go ahead, try. It'd be great to have more people doing things. You spend your life working, so you might as well get in something that you're passionate about.
QUEST: So something that you're passionate about. That is absolutely the best advice from both sides.
Lance Armstrong is giving up his fight against doping allegations. His sponsors are deciding whether to give up on him. In a moment, we assess the damage to brand Armstrong. QUEST MEANS BUSINESS, good evening to you.
QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. This is CNN, and on this network, the news always comes first.
And in Mexico, three US marines have been injured in a shooting. The gunman opened fire on a US embassy vehicle, which was carrying the servicemen south of Mexico City. The marines have been taken to hospital. There's no information on the motive behind the attack.
Two people are dead and nine more wounded after a gunman opened fire near the Empire State Building in New York. The shooter is one of the dead. Officials say he was gunned down by police after killing a former co-worker. The New York mayor, Michael Bloomberg, says the man pulled his gun on uniformed officers.
And a man responsible for the massacre of 77 people in a bomb and gun attack and a rampage in Norway has now received the maximum sentence. A Norwegian court sentenced Anders Breivik to 21 years in prison for carrying out last year's attacks in Oslo and on Utoya island. The sentence can be lengthened indefinitely as long as the killer is considered to be a threat to the public.
Activists say at least 146 people have been killed today in Syria, and most of the deaths were reported in Damascus and its suburbs, and in the city of Deir al-Zour. Meanwhile, Turkey says more than 3500 Syrians have fled across the border over the past 24 hours.
Haiti is bracing for Tropical Storm Isaac, which his expected to make landfall there later on Friday. 400,000 Haitians are still living in tent camps after the 2010 earthquake. Aid groups say their biggest concern is not the wind but the flooding. We'll have a report on this immediately after this news summary with the weather forecast.
The German chancellor Angela Merkel says she wants Greece to stay in the eurozone. Mrs. Merkel met with the Greek prime minister, Antonis Samaras, in Berlin, and she said Greece must make good on its promises in the two-year austerity plan. The prime minister travels to Paris on Saturday, where he'll meet Francois Hollande, the French president.
QUEST: Lance Armstrong's sponsors are declaring their sport support for him tonight. The seven-time Tour de France winner is facing a lifetime ban from competitive cycling, since he's abandoned his battle against doping allegations. He says he refuses to participate in a one-sided, unfair process.
In a statement to CNN, Nike said it continues to support the cyclist and his charitable foundation.
The brewery giant Anheuser Busch also has stood firm, along with the food Honey Stinger, who also made similar comment. Other sponsors, including Trek, Oakley and Radio Shack have yet to comment.
I'm joined now by Patrick Rishe, a sports business specialist at Webster University, who joins me via Skype.
Patrick Rishe, the comment of support are there but you still think -- and perhaps not unreasonably -- that the damage, even though nothing's been proved -- will take its toll.
PATRICK RISHE, SPORTS BUSINESS SPECIALIST, WEBSTER UNIVERSITY: I think it will take its toll eventually, Richard, and as you mentioned, some of the larger companies are currently saying that they will stand by their man, not too different from how Nike and EA Sports stood by Tiger Woods after Tiger Woods admitted infidelity, obviously, two different scandals.
But I think that certainly Mr. Armstrong is not going to see too many new sponsors because companies obviously don't want this connection. But I do see why some of the existing companies want to stay with him.
QUEST: OK. Let's not delve too much into the rights and wrongs and whether this and that. But it is unfair, the man, in the sense of sponsors pulling out, when the man has been convicted in the court of public opinion. But seemingly not by any official body.
RISHE: This is the way it works, Richard, because, again, companies have to be concerned about their bottom line, and companies are worried that if they had a product endorser that represents some negative dimensions, again, it's interesting that we talk about this because, yes, it would be incorrect for Lance Armstrong to cheat if, indeed, he did.
But at the same time, when you look at all the good that he's done for cancer research, I think that's why some people and some companies will give him a pass.
QUEST: Right. So where, for the rest of them, where their backbone and stomach?
RISHE: Well, exactly. Again, I -- it would be hard for me, if I were an adviser, I don't know if I could go up to Nike and say, well, you should cut him because he did wrong, because think about this, Richard.
Yes, if he cheated, if he cheated, it was absolutely wrong for him to do so. But would the same amount of money, in particular, $500 million through Livestrong been generated for cancer research? I don't know.
QUEST: And there is the conundrum that makes this case different from all the others, isn't it? Because Lance Armstrong, through his charitable work, raises a huge amount of money and, frankly, if the sponsors are going to pull the plug, they may as well pull the plug on other cancer victims, too.
RISHE: Well, that's right. And one thing that happened here in the States recently, if I can draw an analogy, of course, the infamous Joe Paterno being fired at Penn State University because he allowed a child molester to be on his staff and didn't report some of those indiscretions.
But a lot of people at Penn State, Richard, supported the alumni donations at that university last year were through the roof, because people wanted to support a coach that had been there for 50 years and had given so much to the school. I think you're going to see the same kind of outpouring of support for Lance Armstrong, because what he did for cancer.
QUEST: Patrick, we'll talk more about this. Fascinating subject. Thank you for coming on and talking and robustly putting the point of view. I appreciate it.
Now to the weather forecast, Jenny Harrison's at the World Weather Center. And there's one I can -- which I can be sure Ms. Harrison, you and your colleagues have a busy few hours ahead.
JENNY HARRISON, CNN METEOROLOGIST: Yes, this, the Tropical Storm Isaac, Richard, certainly keeping a very close eye on that of course. A lot of correspondents on the ground as well.
The conditions are beginning to deteriorate for the next few hours, because right now, we've had the latest update from the National Hurricane Center, and it looks as if it'll be making landfall across this southern western portion of Haiti in about 12 hours from now. That means that around sort of 2 o'clock early hours anyway of Saturday morning.
Now the winds (inaudible) quite considerable in the last 24 hours, close to 100 kmh. We could see some more strengthening before it actually makes landfall. It's moving quite quickly at 23 kmh. That's a good thing. We like these storms to move quicker. Gives them less time, of course, to wreak the havoc that they can indeed do.
But the concerns, of course, with Haiti are twofold, really. First of all, we've got these very, very strong winds. But in fact, they're to the north and the northeast of this particular storm, the eye of the storm. But then it is the actual land it is traveling across. The mountains will protect from the winds, but the rain is the real concern.
And we have this really, really dense population and of course, as we know, what you're looking at here are just hundreds of thousands of people who are still, of course, living in that temporary accommodation, literally just canvas between them and what could be these torrential amounts of rain. And because of the deforestation in particular in Haiti, mudslides and landslides are very, very possible.
There's nothing at all to hold that soil in place. And so as the rain comes in in the next few hours, already of course (inaudible) conditions have been deteriorating across the Dominican Republic, we really could be seeing some very serious concerns because of the flooding.
So we'll keep you well updated. And meanwhile across in Europe, a very unsettled few days ahead. I know you've heard that before, but particularly unsettled across much of northern Europe. A lot of cloud has been spilling in the last few hours and thunderstorms in the south. And a lot of that cloud making headway across the southeast.
So look at the temperatures. Here we have this heat wave in place for the last few days. Well, the temperatures are coming way down over the next few days, Prague, Vienna, even eventually into Budapest and in fact if anything a little bit below average. And that is because this jet stream has been forced further south.
So you've got this very unsettled area with the rain showers, the thunderstorms and also that cooler air is coming in behind. But of course some very heavy rain has been coming, and already the low countries in particular, really seeing some heavy storms, eastern areas of France as well, some areas across the U.K.
There are warnings in place Friday and Saturday, quite widespread for those strong thunderstorms, the more damaging hail. And look at this cooler air, really filtering in now across central and western Europe. But of course, across some regions in Europe, certainly in the U.K., it is a bank holiday weekend.
Well, it's fairly typical bank holiday weather. The rain is coming in, certainly a very damp, unsettled start to the holiday weekend, 20 Celsius in London, 23 in Paris. It might be a bit of a better Sunday, but Richard, I think it's the weekend for indoor activities.
QUEST: Indoor activities, splendid. We thank you for that. I'll pass that on to Prince Harry. Many thanks indeed.
QUEST: Jenny Harrison at the World Weather Center.
Now Londoners are getting ready once again to let the games begin after the success of the Summer Olympics. The Paralympic torch has arrived in the British capital with the opening ceremony just five days away. Erin McLaughlin was in Trafalgar Square to see the lighting of the flame.
ERIC MCLAUGHLIN, CNN CORRESPONDENT: Earlier today, this cauldron was lit to mark the official beginning of the Paralympics torch relay.
(BEGIN VIDEO CLIP)
DAVID CAMERON, U.K. PRIME MINISTER: Here in London, we can proudly say the Paralympics are coming home.
(END VIDEO CLIP)
MCLAUGHLIN: Officials were also on hand for the unveiling of a giant set of Agitos, which is the official symbol for the Paralympic Games, suspended from Tower Bridge. It's all designed to (inaudible) excitement ahead of the games since 4,000 Paralympic athletes expected to compete, 2.3 million tickets sold so far. Officials here say this is set to be a great game.
BORIS JOHNSON, LONDON MAYOR: Tickets for these games are going faster and more furiously than tickets have ever gone before in the history of the Paralympics. And that, I think, is because of the excitement partly that was built up by the Olympics, but also because people engaging with the Paralympics in a way they haven't done before.
MCLAUGHLIN: That's quite a quick turnaround from the Olympics. What kind of planning and preparation did it take to make --
SEB COE, CHAIRMAN, LONDON 2012 ORGANISING COMMITTEE: It's been a quick turnaround for very good reason, and that is we wanted to maintain the spirit of sporting celebration throughout the U.K. for as long as we possibly could.
And so it's meant that, you know, we probably only had about five working days to turn the village `round, 10 working days to transform London from an Olympic into a Paralympic city and all the adjustments that we make to our venues.
MCLAUGHLIN (voice-over): The cauldron was lit by 32-year-old Clara Lomas (ph), who's paralyzed from the chest down in a horse riding accident.
CLARA LOMAS (PH), PARALYMPIC: Well, what an experience it was (inaudible).
MCLAUGHLIN (voice-over): She managed to complete this year's London Marathon in a bionic suit, raising over $300,000 for spinal research.
MCLAUGHLIN: Cauldrons like this one will be lit in three other cities across the U.K. The flames will eventually be joined into one for an overnight relay into London for the start of the Paralympics opening ceremony next week -- Erin McLaughlin, CNN, London.
QUEST: Now, just to take a quick look at the Dow Jones industrials and how that is trading at the moment, the Dow is currently up 81 points at 13,138 with a gain of half a percentage point. Interestingly, what we're seeing here with the Dow, a complete reversal in the last 24 hours.
But volumes are very light and we need to be very cautious, particularly bearing in mind Europe was just about flat over the course of the day.
A quick look a the European markets -- just remind you how they ended the week. They are all unchanged, give or take. I will have a "Profitable Moment" for you after the break.
(BEGIN VIDEO CLIP)
QUEST (voice-over): Time for the answer -- excuse me -- to today's "Currency Conundrum," we asked how much of a damaged dollar bill must you have to get it replaced by the U.S. Bureau of Engraving? The answer, 51 percent. You've got to have more than a half of an identifiable note left.
Now there you have a note, a dollar bill. And if that was your dollar bill, you would have to have that much of it left. And if that much was left, you could go along to the bureau and say, oy, I want a new one, and they would take that away, because when they saw that one, if you tried to do it, they would measure it. And they would say, huh, that's only 49 percent. You get the idea.
If you want to follow us -- follow me on Twitter and have a conversation away from the television, then it's @richardquest, which is the Twitter address as always or you can email me at firstname.lastname@example.org. And so, as always, we come to tonight's "Profitable Moment."
There is a depressing familiarity to the statements that we are hearing from Euro leaders as the summer comes to an end, and they start preparing for what everybody accepts is going to be a volatile September. Greece belongs in the euro, they say; Merkel said it today. They will do everything they can to keep Greece in the euro.
Samaras said it today. It's up to Greece to stay in the euro. Hollande said it yesterday, on and on and on it goes. Well, yes, there are decisions that have to be taken.
There are issues that need to be solved, whether Greece should get more time, whether the bailout fund is legal, according to the German constitution, whether Spain should apply for full bailout and when structural reform will make the Eurozone a proper functioning currency, not a sad joke. We are one step away from the next euro crisis, which is grim news for everyone.
Well, I'm away for the next two weeks on holiday. I don't expect the leaders will have done much beside racking up air miles, visiting each other, making meaningless statements. So while they probably won't do much good, I beseech them to remember the Latin maxim, "Primum non nocere." "Do no harm."
And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in London. Whatever you're up to in the weeks ahead, I hope it's profitable.
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NKEPILE MABUSE, CNN CORRESPONDENT (voice-over): These images shocked the world, police opening fire on striking mine workers. In post-apartheid South Africa, this is the kind of violence many thought was in the past.
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MABUSE: You're watching MARKETPLACE AFRICA. I'm Nkepile Mabuse at the scene of that dramatic confrontation. On the show this week, we ask, who has blood on their hands and what does this all mean for South Africa's wounded platinum industry?
MABUSE (voice-over): The anger was palpable. The clubs and machetes were blatant. Tensions at the Marikana platinum mine just north of Johannesburg had been brewing for a while. In the days leading up to the shooting, increasingly large crowds were gathering on this hill just opposite the mine.
Three thousand rock drillers were striking, demanding higher wages from Lonmin, the company (inaudible). By now, 10 people were already dead, including two police officer. Some had been hacked to death.
South Africa's platinum industry, the largest in the world, has already been hit by several industrial disputes this year, like this one at Impala Platinum, which lasted six weeks and left several people dead. This is an industry hit by the sluggish (inaudible) industry in Europe. (Inaudible) are being built so the need for the metal in catalytic converters is down. Production (inaudible) of platinum (inaudible) have been falling.
GOOLAM BALLIM, ECONOMIST, STANDARD BANK: South Africa's platinum producers, as well as resource producers generally have struggled under the weight of lower volumes, demand and also shallower prices fixed.
MABUSE (voice-over): By Thursday, 16th August, there was a standoff between the strikers and the police. The workers charged forward.
(Inaudible) was swift and deadly. Thirty-four were killed. At least 78 were injured. Sibongile Sikhuze was one of the striking workers who was injured. I helped his wife track him down in a nearby hospital. She thought he was dead.
SIBONGILE SIKHUZE, MINER (through translator): The bullet went through here and came out on the other side.
MABUSE (voice-over): He still can't believe he made it out alive.
SIKHUZE (through translator): I raised my hand to surrender, thinking they'd leave us alone. But then I was hit by a rubber bullet right here. And then they ordered us to lie on the ground. People were falling all around me. Another bullet grazed my head. I didn't think I would come out alive.
MABUSE (voice-over): Police (inaudible) acted in self-defense against an armed and dangerous mob, according to police six guns were recovered from some of the dead miners. Sikhuze was carrying a club. He says he never intended to kill.
SIKHUZE (through translator): In my culture, men carry clubs, not to hurt others. It's tradition.
MABUSE (voice-over): A week of mourning was announced. The (inaudible) was quick to condemn the violence and President Jacob Zuma launched an inquiry. But the underlying reasons behind the workers' dissatisfaction remain. Mine worker Cingisile Makhaba invites me into this compound of one-room shacks he shares with eight other families.
CINGISILE MAKHABA, MINER (through translator): We earn very little. We had to build ourselves a toilet and we share one outside tap. We work hard, but we live like animals.
MABUSE (voice-over): The father of two makes $500 U.S. a month as a rug draw (ph) operator in the mine. He says the deaths of his colleagues have made them even more determined not to return to work until a pay deal is struck.
MAKHABA (through translator): We cannot go back to work until we get the $1,500 we're demanding. Otherwise, those who have died will have died in vain.
MABUSE (voice-over): Critics say the striking miners have become pawns in a dispute between two rival unions, the National Union of Mine Workers, a key supporter of the ruling ANC (ph), and the newer, more militant Association of Mine Workers and Construction Union.
They are accused of battling to win members and not bringing this industrial dispute to a negotiated settlement. It is an accusation they reject.
I asked the union's president about allegations his members are using death threats and intimidation to grow their organization.
MABUSE: What I'm asking you is does your union have blood on its hands? Because some people have said that your union is behind the violence that we've seen here.
JOSEPH MANTHUNJWA, AMCU LEADER: Our union doesn't have the blood. It's our union -- did you see any person wearing our T-shirts, pulling the trica (ph)? Did you ever see anyone have a paunau (ph) in his hand and chopping someone? So there is baseless, those -- I mean, those allegations.
MABUSE: Gideon, (inaudible) represent 23 percent of the workers here at Lonmin platinum mine. Have your members gone back to work?
GIDEON DU PLESSIS, SOLIDARITY TRADE UNION: A few of them, but there's a high level of intimidation and also it's such a confusing situation. Basically this is a perfect storm. You don't come to wage negotiations with sticks and pangas (ph) and murder weapons.
MABUSE: Do the unions overall have blood on their hands?
DU PLESSIS: It's got to a point where the unions definitely (inaudible) show strong leadership. They did not take control of the situation (inaudible) inquiry will come out if that startup union played a role. But nevertheless, by the time when the situation got out of hand, it was too late for anybody to resolve the issue of the bloodshed was most probably inevitable that it didn't happen.
MABUSE (voice-over): The desperation and disillusionment of these workers makes them vulnerable. Expelled AMCU leader Julius Malema arrived in a car fit for a mine owner to talk about his solidarity with the workers. Malema was once a supporter of President Jacob Zuma, but now he blames the deaths on the government.
JULIUS MALEMA, FORMER ANC LEADER: (Inaudible) decided over the (inaudible). President Zuma's government has (inaudible) our people.
MABUSE: For Lonmin, the situation could be critical. Production at the mine has been stopped by the strike and executives admit they will not make their yearly targets. Every single day that workers stayed away has been a huge financial blow for a company already struggling. But that's nothing compared to the tragic loss of life on their doorstep.
MABUSE (voice-over): According to the union, every day that the miners stay at home and the mines stand idle, it costs the company $6 million. Lonmin threatened dismissal if the workers did not return, and then lifted it. The company's share price slumped. The price of platinum has risen.
After the break, we speak to the acting CEO of Lonmin about the bloodshed and the challenges ahead.
MABUSE (voice-over): This was the moment South Africa experienced its most bloody industrial dispute since the end of apartheid, 34 people died and many more were injured. Simon Scott is the acting CEO of Lonmin. He is tasked with negotiating a settlement with the striking workers and navigating his company through the challenges of the country's struggling platinum industry. David McKenzie spoke to him.
DAVID MCKENZIE, CNN CORRESPONDENT: Do you feel that your company has blood on its hands from what has happened?
SIMON SCOTT, ACTING CEO, LONMIN: I don't think so. I mean, I think we all, as South Africans, feel exactly the same way that you feel.
We've done -- you know, we've gone -- we've made sure that any of our employees that have been directly affected in this, we're doing as much as we possibly can. We've put in place counseling for the families. We're assisting in the arrangement appropriately with regard to the burials that need to take place.
MCKENZIE: So who's fault is this?
SCOTT: There is a commission of inquiry that has been set up to look at whose fault it may be. At this time, we're not pointing fingers. We're saying let's get back to work. Let's get our operations running smoothly. And then if there is blame to be apportioned, let's do that at a later stage.
MCKENZIE: Could the mine company have done more to avoid this by sitting down and talking to the strikers?
SCOTT: What we had was an illegal work stoppage, where workers chose not to come to work. And it quickly escalated into one of public violence. We weren't at any stage -- didn't have that opportunity of engagement.
MCKENZIE: And a lot of people have been shocked at this, liken to a time in the past in the mines in South Africa in the mid-`80s, late `80s. Do you think that comparison is fair?
SCOTT: The scenes of public violence shocked us all. I mean, it wasn't something that any of us relish. But I think within the mines, the situation has changed quite considerably.
MCKENZIE: Right now it's a difficult time for platinum industry in general. How will this affect your company in general, going forward with the prices dropping and the continued industrial action?
SCOTT: Yes. I mean, as you say, it's a tough time for the industry. The industry has been one where we've been faced with tightening prices, prices have been coming down. We have had cost increases over time increasing.
So it is a tough place to be at the moment. The sooner we get our operations up and running, the more resilient we can be as an organization. And, indeed, the better for the South African platinum industry in general.
MABUSE (voice-over): Whatever the challenges facing the company in the longer term, in the short term, the majority of workers are staying away from the mine, determined to get some kind of deal on their pay. In Australia, wages are six times higher than they are in South Africa. Executives at Lonmin say they've reserved the right to discipline the workers; for the time being at least production of ore has stopped.
MABUSE: This is where blood was shed and where people now come to mourn. What happened here has exposed (inaudible) among those who feel left behind by South Africa's march out of apartheid.
This high unemployment here and poverty, and even those who have jobs share a growing anger towards the ruling party. And the unions that are seen to be too close to them and the companies who many feel profit at their expense.