Return to Transcripts main page

QUEST MEANS BUSINESS

Apple PC Sales Examined; Oil Price Drop Affecting Russian Economy; Talking about Big Lottery Prizes; OPEC Concerned over Oil Prices; NFL Relocating Team to Los Angeles; Al Jazeera America Closing. Aired 4-5p ET

Aired January 13, 2016 - 16:00:00   ET

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


[16:00:00] POPPY HARLOW, CNN ANCHOR: One the 13th day of the year, it is an unlucky day to be a trader, the Dow closing down more than 350 points.

It is Wednesday, January the 13th, tonight, yet, another selloff, U.S. market now dive (ph) without warning. We will live at the New York Stock

Exchange.

And time to face reality as oil prices stumble, Russia says austerity may follow. And how the falling price of oil help shut down a television

network, the story Al Jazeera America now going off the air.

I'm Poppy Harlow and this is Quest Means Business.

Good evening, welcome to the program. Tonight stocks selloff and volatility spikes on Wall Street in early rally turn to red shortly after

the open. You see it all there in your screen at the Dow settles around 364 points lower. CNN's (ph) measure of investor sentiment in point to

extreme fear. Some of the brightest stars and the Nasdaq also hitting credible hard today. Shares of Amazon down nearly 6 percent, you see right

across the board there, Netflix off 8 percent.

The selling clearly broad based the S&P 500 fell more than 2 percent of the day breaking below that 1,900 mark. The tech heavy Nasdaq, they're worst

of the drop of more than 3 percent all three major U.S. indexes, now officially incorrect in territory that's fall of 10 percent or more from

our recent high.

Wednesday's decline are partly driven by the continuing decline in oil prices, Brent Crude, the global benchmark for oil, touched below the $30 a

barrel mark for the first time since 2004, has rebounded slightly and it still off 2 percent on the day.

Alan Valdes is Director at Floor Trading at DME Securities. He joins me now from the Stock Exchange.

Alan, we all look at the market around 2:00, and we ask what's happening? So I will ask you, my friend, what happened?

ALAN VALDES, DIRECTOR AT FLOOR TRADING AT DME SECURITIES: Poppy, good evening. You know, one thing that happened was the big discretionary

stocks started taking a beating like Amazon and other ones like that in Asia. And that really start the Dow with swing in the market.

I mean, you had oil on slide a little like you mentioned but not as off as was the other day. So basically, it was now discretionary stocks they were

looking about.

But, you know, Poppy, yes there was some troubling news, you all the big houses J.P. Morgan, Royal Bank of Scotland. Royal Bank of Scotland went so

fast stay (inaudible) liquidate everything. J.P. Morgan still sell on the rallies. So I think that was heard big by everybody and they start to

listen to as it take affect, and there was sell of these rallies we saw.

HARLOW: How much of this, Alan, is China? Because we know the concern about China and we've seen it all play out. But, this is a global economy

that these companies are, you know, responding to and you've got a lot of frame. You got a very good U.S. jobs report on Friday. It is all about

China and oil?

VALDES: Well, yes. At the end of the day, at least, right now, it's mainly oil and China. But, you know, Poppy? There another thing going on.

You saw this morning, you know, bad news used to be good news. Bad news for Wall Street was good news for the market.

But without the fed, bad news is now bad news. So instead of the market rally like it used to rally, now it just selling off. And we're seeing

that across the board everyday.

HARLOW: But it's been a long time since we've had, you know, and to this whole market that's been going on and on and on, you've seen a trillion

dollars wiped out from the market in 2016 alone, in this past few weeks. Summer fearing a bare market, some see it as worst. Is there also enough

side to this, to the market getting into, let me call it reality territory?

VALDES: Well, it depends on where we are. I mean, if you have a few board years before you retire like maybe 20, it's a good time. Stocks are on

sales, like going a maze season (ph), seeing like a 50 percent off sell. So yes, it's a good time to take advantages, some of these great blue chips

I trade here, and put them in your portfolio.

But this never good time when you lose a trillion dollars of money value in your market in the first week basically. So I would have say, it's a good

time and I think oil is going to keep on, unfortunately, going down. And that's going to bring the market, down. I don't see any -- and oil at

least probably to the mid-20s. I think it's going to be slow as 10 and I want to be as bearish as RVS and sell everything.

But I be careful, I don't think I'd get involve unless it's really something I like and is definitely on sale.

HARLOW: Yeah. And it definitely hurts jobs across the board but here in the United States, all those good paying energy jobs.

VALDES: They need you. Alan, thank you so much, I appreciate it.

Let's talk more about this. This is Randall Kroszner, he serves as a governor of the New York -- of the Federal Reserve System. He is now

Professor at the University Of Chicago Booth School Of Business. Thank you for being here.

[16:05:03] RANDALL KROSZNER, PROFESSOR AT THE UNIVERSITY OF CHICAGO BOOTH SCHOOL OF BUSINESS: Sure.

HARLOW: Let's talk about oil. I mean, you saw Alan bring it up. He doesn't believe what standard charter is predicting $10 a barrel oil. But

it's in dramatic slide in oil and nothing seems to be pointing to any upward pressure.

KROSZNER: I mean, I think it's a simple case of supply and demand, certainly it is less demand. China is slowing generally, but also speaking

the transition from the export oriented and manufacturing, investment economy to more domestic consumption based economy. So they would be

consuming, you know, less anyway but they're growing less. They're double consuming less.

And the supply side, you had just incredible technological innovations that have allowed for hydraulic fracturing, allowed for horizontal drilling,

deep water drilling. And also, the technology has been improving over the last year or two, to allow more and more production even at these low

levels.

HARLOW: Right.

KROSZNER: So you're going to continue to see a lot of supply come on line even though oil prices are down to $30 a barrel.

HARLOW: OK. So what if China because I had an expert on my show a few days ago who said, "A real concern is the confidence level in Chinese

President Xi Jinping and the consolidation of power. How must is that playing here?

KROSZNER: I think that's a very part of it, because the stock market is not that big in China relative to the GDP.

HARLOW: Right.

KROSZNER: But it's more the concerns that have been about the management of the Chinese economy, which has been astonishingly successful over the

last 30 years.

But it's been a little bit challenge over the last few months, that clearly aware of this problems and they've just created a new administrative

structure kind of deal with some of the financial and exchange rate problems. We'll have to see if it's going to work.

HARLOW: I think that just also a question of confidence and the truth of the Chinese economy. Well, it's very hard to just something when you don't

know what the number really are.

KROSZNER: For sure. I mean, that the issue has been there for a very long time.

HARLOW: But that's been issue as it really has been booming, now really is slowing and we're not getting arguably through read on it.

KROSZNER: And so, it's always a problem when you don't know exactly what's going on. And what's why (inaudible) have this very strong reactions to

like the initial devaluation of the renminbi. Because people just thought that's dramatic policy change. They didn't -- it took them two days to

have press conference.

And they thought they were being for coming because we had a press conference, it's completely different style.

HARLOW: All right, outside of the energy sector which is clearly in pain here in the United States. Strong jobs report on Friday over 300,000 jobs

added to this economy. You've got unemployment of 5 percent. Where is the -- why aren't we seeing any upside in the markets to the strength

fundamentally at home?

KROSZNER: So, obviously, the U.S. integrated in with the world economy. So major challenges in China are going to have an implication, also I think

there's a lot of uncertainty about what's going on the Middle East.

So geopolitical risk in the Middle East plus concerns that there could be some challenges with the management of the Chinese economy, the world's

second largest economy, those coming together can make people revise what the U.S. is going to look like going forward.

And if you look at something on the S&P 500, a very significant fraction to revenues come from outside of the U.S.

HARLOW: Right. It's a very important point and the S&P breaking through another psychological barrier, was in below 1900 today. We'll be watching.

Thank you so much. I appreciate it, Randall.

In Europe, stocks ended the day mixed. Investors cheered better that expected trade data out of China, we are just talking about, and the early

rise in oil process push energy stocks higher. But concerns of rising U.S. oil inventories, limited those gains.

The oil prices didn't just move traders, the Russian government is feeling the pain and cheap oil may even have claimed a U.S. television network,

next.

(COMMERCIAL BREAK)

[16:10:25] The low oil prices are hitting home around the world. In Russia, the government is considering a 10 percent cut in spending that is

on top of a 10 percent cut, last year in budgets and oil prices are now around $30 a barrel.

The finance ministers calling on government departments to find more places to because the government relies on oil for half of its revenue. Exporting

oil makes it half of Russians Revenue, and they need 82 dollars a barrel to even break-even.

We are way off from that Russia's current budget as based on $50 a barrel oil, with the deficit of three percent in addition to those cuts, the

economic ministers says that the government should consider reducing its stake and some of the nation's top lenders.

Joining me now from Washington is Andrei Illarionov. He is a former Chief Economic Advisor to Vladimir Putin. He is now a senior fellow at the Cato

Institute. I appreciate you being with me, sir, good evening.

ANDREI ILLARIONOV, FORMER CHIEF ECONOMIC ADVISOR TO VLADIMIR PUTIN: Good evening.

HARLOW: We've heard this before, we saw 10 percent cut last year. You're seeing a 10 percent hair cut (ph) now. You really believe that that is

enough to save off a crisis, here when you have oil dipping below $30 a barrel.

ILLARIONOV: Nobody sure this (inaudible). First of all, we don't know the oil prices for the rest of the year. So a lot of forecast and nobody knows

for sure where the oil prices will stay at this level of about $30 per barrel, or they'll down.

But what is quite clear that (inaudible) to $50 per barrel which is in the Russian budget is probably too high at this moment. And it means that

future carts in (inaudible) almost enter with the vault.

HARLOW: the Russia's top finance official Anton Siluanov says, he said, as I just said, that you need oil at $83 a barrel for Russia to break-even.

Is it possible to look at a feasible diversification of Russia's economy in the near term?

ILLARIONOV: It is inevitable in the longer term sooner or later, but it is definitely impossible within one year or couple of years. It's definitely

impossible. The main problem for the Russian economy is not economic one, these are political one. Because the Russian government is trying to wage

three warsh (ph) on France, and that is why one item that is not going to be cut and may called this budget items is military expenditure. So -- and

all this military plants and factories are working fully for as we shifts.

HARLOW: What would you do?

ILLARIONOV: Definitely, the main problem of the current economic crisis is not only oil prices but this is a military duration. Each military

campaign over last few years shape several percentages of economic growth from Russian GDP.

Georgian (ph) campaign lets economic grow falling from seven of the year to 4 percent. Ukraine campaign from (inaudible) to zero, beginning called

Syrian campaign, let Russian economy to going down by 3 percent. Now, Russian government that Turkish could pay, so it's definitely will go down

even 4 percent.

So that is why the first one is just to stop aggression around the campaign (ph).

HARLOW: OK. How do you diversify aside from the military spending which is no indication point of Vladimir Putin falling back on the that

whatsoever, especially given the geopolitical landscape, right now? What would you do to diversify Russia's economy then in the long term, in the 5,

10, 15 year outlook? Where else can it go?

ILLARIONOV: OK. This problem has been actually prepared even when I was back in the administration in the early (inaudible), and it has been

partially implemented them and after that is have been roughly stopped. So this program or privatization, liberalization downsizing the government,

cutting taxation, and providing low incentives for private businesses both Russian businesses as well as foreign businesses, and integration of

Russian into the world economy.

It's exactly what have been stopped over last several years with the Russian government.

HARLOW: What it is do to Vladimir Putin's internal popularity, a domestic popularity?

ILLARIONOV: You know, in (inaudible) regimes, the popularity does not translate the economic institution does not necessarily translate

immediately into a level of popularity.

[16:14:59] So that is why in the midst of very serious economic crisis, which is now is for, been three months in a row. The official level of

popularity is really may high more than 80 percent, but it is rather hard to believe to those numbers, because traditional sociology does not keep it

correctly the real level of support in, I'm sorry, current regimes.

HARLOW: All right. Thank you so much, Andrei, nice yo have you on the program tonight. I appreciate it.

The U.S. energy information agency says there is little relief on the way it is forecasting an average price of $40 a barrel for crude this year, $50

a barrel in 2017. The key reason is over supply, what we just talk about.

Some OPEC want the cartel to rethink its strategy of keeping output high, doesn't look like they're going to do that right now. Here is why they

want that, though.

There are oil prices that need to balance, that they need to balance their budgets. We're talking about major, major suppliers here. Kuwait $49 a

barrel, that's not even close to balancing their budget. For others like Saudi Arabia at Bahrain, they need oil prices in the triple digits, the UAE

though in 5th that OPEC must hold firm and keep humping at the same levels.

The UAE's Energy Minister spoke with our Emerging Market Editor John Defterios

(BEGIN VIDEOTAPE)

JOHN DEFTERIOS, CNN EMERGING MARKET EDITOR: Well some within OPEC are calling for an emergency meeting due to the severe slump in prices, the

core of Middle East producers lead by Saudi Arabia are not budgeting from their positions to fight for market share over prices. That message came

out loud and clear for the minister of energy here in the UAE at a round table I chaired here in Abu Dhabi. Suhail Al Mazroui said, "I will be bumpy

road ahead when it comes to prices in the first half of the year."

(BEGIN VIDEO CLIP)

SUHAIL MOHAMMED FARAJ AL MAZROUI, UAE MINISTER OF ENERGY: We will see production. It's not going to be in the first quarter or the second

quarter. I think we would -- the first six months are going to continue. It will be tough. On average, we're not expecting a significant move

because of the lower oil prices in the first half of the year. We're not - - if you look at the whole year as an average, you're not going to see a significant jump like what we used to see.

DEFTERIOS: Your raise is a very interesting point. We -- at that level today, because of the price pressures to call an emergency meeting and

regroup, and look at the strategy within OPEC today?

MAZROUI: And my assistance to the strategy, I think the strategy is working. If we do something artificial, I don't think that's going to

last, because we're so small compared to a -- affecting the whole world on what they are going to do. Once you have that magnitude of a problem, I

don't think it's fair to ask OPEC to come and withdraw $2.7 million to just keep the prices where they were.

DEFTERIOS: So there's no reason, Minister, for OPEC to call an emergency meeting and change course at this stage of the game some 14 months into the

strategy that was adapted in November 2014.

MAZROUI: I don't think this is a big problem not to have a meeting. But what are we going to agree, we need to be convince. And I'm not convince

that OPEC alone can change, I don't think we can solely, unilaterally change the strategy just because we have seen a low in the market.

DEFTERIOS: There's aspiration by Iran here to add at least a million barrels a day by the end of 2016, how does OPEC accommodate Iran's return

or does it need to, just every man for himself?

MAZROUI: I think all of the members including the Iran are having their rights to increase their production. If someone is going to producer

regardless of the economics of the project, and have the money, that's another thing.

But if you look at it as an investment and you want all IOCs or companies to come and invest, I think you need to be more realistic on bringing a

million dollar just on the spot.

(END VIDEO CLIP)

DEFTERIOS: Mazroui said, we are starting the second of process that should eliminate enough higher cost production to stabilize the market by the

close of 2016. But as he admits that they have sharply rising oil prices are long gone.

John Defterios, CNN, Abu Dhabi.

(END VIDEOTAPE)

HARLOW: John, thank you for that.

The decline in oil prices may have claim the very unexpected casualty, Al Jazeera America, the Qatar government owns the Al Jazeera Media Group and

also the U.S. Arm (ph). Al Jazeera America will shut down on April 30th, two and a half years after it first hit the air.

CNN Dylan Byers is following the story with us.

Painful, we both have friends there. It's hard to see a colleague and comrades in this business go. Striking what the management said on the

conference call today, pointing to oil.

DYLAN BYERS, CNN SENIOR MEDIA REPORTER: Yeah. So if you want to ask what happened to Al Jazeera America, two things. One, no one was watching but

no one was ever watching, I mean, they have between 20,000 to 40,000 in prime time.

[16:20:05] HARLOW: Total.

BYERS: The total. I mean, that's extremely low even the cable news standards. But what really happened here was oil. Oil down to -- having

around $30 a barrel, you have Qatar which is obviously -- which owns Al Jazeera Media Group depending on oil.

Back in September when oil prices were dropping, they announce that they were going to cut up to a thousands job across their properties including

properties in the U.K. and in Middle East. What they decided to do instead was just chop up the American Arm (ph) all together, and now you're going

to see hundreds of staff cuts here in the United States.

HARLOW: How much of a blow is that? I mean, this was a big move for them to come in to the United States of purely American channel.

BYERS: Yeah. There was never -- and for being honest with ourselves, they -- it was a ambitious ask, to ask Americans to watch a network on by Qatar

called Al Jazeera America.

HARLOW: But to be fair, they had really strong -- they had some very strong programming. They had a lot of strong in-depth reporting. And they

said sort of we're going to give the different cable news network.

BYERS: Right. You know, that's absolutely true. And there's no question at some -- look, to some television critics who watch this Al Jazeera

close. They would say, it was one of the best programming on television.

The promise is that, what they were offering was a sort of different version of the BBC. And there's no evidence that American audiences want

that. If you look at what American audiences watch from reality television to, you know, including the 2016 campaign, to sports, things of that

nature, there's just no evidence that there's appetite for that in this country.

HARLOW: Obviously, sitting in the sit that you and I sit in, we all wonder what does it means for the larger picture, cable companies, what does it

mean in the wake of cord cutting, what does it mean for the big picture?

BYERS: Well, I would not, certainly, a cable news industry has questions that it has to ask the entire television, media industry has questions it

ask. I would not look at what happened to Al Jazeera is harbinger of what's going to happen to the rest of American media companies. This is

very clearly something that happened because of Qatar's economy and because of it's reliance on the price of oil and how oil is doing.

But it is true that Al Jazeera America was probably headed for an end at some point, this is just facilitated and made it happen faster.

HARLOW: All right. Dylan Byers, thank you very much. Your stories out in CNNmoney.com, people could meet a lot more there. Thank you.

BYERS: Thank you.

HARLOW: I appreciate it.

Also, from declining oil to declining P.C. sales, falling to the lowest level we have seen in years and years. We will discuss service future for

the personal computer at least as we know it, next.

(COMMERCIAL BREAK)

HARLOW: Personal computers sales have dropped to their lowest level in almost a decade. Global shipments are down more than 10 percent year on

year. This is the first time since 2008 that we've seen global shipment of P.C. below the 300 million mark.

But Apple, Apple, not a huge surprise here is the only P.C. company to increase their shipment in 2015. H.P., Dell, Lenovo, all stock sales fall

3 percent to 6 percent. Acer saw sales fall 18 percent.

Shelly Palmer, host of Shelly Palmer Digital Living joins me now.

I guess, it's a sign of times but I also wonder why this is Apple given their products are so much more expensive continue to buff the trend?

[16:25:07] SHELLY PALMER, HOST, SHELLY PALMER DIGITAL LIVING: There's always room at the top, always. They make the best product, they make the

best product by an order of magnitude.

HARLOW: This interest, these numbers on red who makes the most money, these are about the number of items sold.

PALMER: That's true. And it's going to be that way. Look, it doesn't matter how much more powerful your computer is, it's not going to run

Microsoft Word or Excel any better. For the average non-power user, which is almost everyone in the world, the computer you had three years ago is

just fine. So unless it breaks, you drop it, it's a laptop that a car rolled over, you just don't need another one.

On the other hand, no one ever really needed a computer, what you needed was the functionality that we have in our smart phone. You need to be able

to txt and e-mail, and look at the web in a number of different ways, transact immediately.

And so, the smart phone, especially the big smart phones, these are large screens. And you can actually do real business on them. So the P.C. is

just, you just don't need it. A P.C. is around the same price as a high- end smart phone. Advice (inaudible) some P.C.s are cheaper and to the average person, less valuable.

So the P.C. business is in serious trouble.

HARLOW: Is there a lesson, I mean, I don't remember sitting down with (inaudible) the chief executive of H.P. about six months ago. And she was

concern about the decline in P.C. sales. Obviously, it affects our business a lot, is there a lesson that any of Dell, H.P. Lenovo, you name

it, can learn from Apple right now? Or, is it too late?

PALMER: I don't think there's a lesson to be taught here. The technology is evolving, you know, Moore had a law, Gordon Moore had a law called

Moore's Law and it said that the density of transition on silicon was going to double about every 18 months. And that's how sort of Intel made chips

that we thought about it.

But in a certain point, what they forgot is that, the average person doesn't benefit from the faster process or -- and when they do, it's a new

form factor.

HARLOW: I don't want to write my dissertation of my iPhone.

PALMER: And you shouldn't, but you don't need a brand new P.C. to do it. When your P.C, breaks, you'll get a new P.C. So the business is going to

decline, is there a lesson from Apple? They make an amazing product and amazing ecosystem, and yes they are the high cost provider, I will say

that.

But in many respects, it's a pleasure to use and its better built and it last longer. So there are very few P.C.s that meet the test than Apple.

HARLOW: Also, one with things that tales would go up with a rising middle class in China in India for example. But they are skipping right over the

P.C. and going right to the phone.

PALMER: Yes, that's right. That's right. That nobody needs those functions unless you're in school writing a dissertation, or you're in a

business that requires an amazing amount of spreadsheet capabilities...

HARLOW: Yeah.

PALMER: Or you're in the media business and you need to edit or the music business, there are things that require a lot of horse power but the

average person, the person used to go to Best Buy and just buy a P.C. doesn't need a new one.

And that's also, look, windows didn't do -- and Microsoft didn't do anybody any favors my making Windows 10 free. Because you don't have to pay for

the operating system upgrade, so now you're really don't need to buy a new computer. So that kind of gave a real shot to someone who was down by not

charging for Windows 10. There's just no reason to buy a new P.C. right now.

So, yeah, I'm not really bullish -- I have on today with the stock market where it is, and an oil where it is to say, "Yeah, P.C.s are doomed but,

hey, P.C. are doomed."

HARLOW: Shelly Palmer bringing us all the good news tonight.

PALMER: Yes. Sorry.

HARLOW: Thank you so much. It's nice to have you on, sir.

I do want to get back to the market in a sharp sell off in late trade. The Dow closing down more than 330 points, we will look at the down of the

Nasdaq just ahead.

(COMMERCIAL BREAK)

[16:30:52] POPPY HARLOW, CNN JOURNALIST, FILLING IN FOR RICHARD QUEST: Hello, I'm Poppy Harlow. Coming up in the next half hour of "Quest Means

Business," the so-called fang stocks suffer a bruising session. We will explain the big selloff in tech.

And $2, 6 numbers and a 10-figure jackpot. The United States is going Powerball crazy.

Before that though these are the top news stories we're following for you this hour.

Iran has released ten American sailors who drifted into Iranian waters on Tuesday after just 24 hours. U.S. Secretary of State John Kerry expressed

appreciation for Iran's swift response and he says all indications suggest the sailors were treated well.

(BEGIN VIDEOCLIP)

JOHN KERRY, U.S. SECRETARY OF STATE: It is clear that today this kind of issue was able to be peacefully resolved and official resolved.

And that is a testament to the critical role that diplomacy plays in keeping our country safe, secure and strong.

(END VIDEOCLIP)

HARLOW: Authorities in Turkey have detained at least four people in connection with the terror attack in Istanbul on Tuesday.

Turkey's prime minister says the suspected ISIS bomber was not on any watch list. The suicide bombing at a busy tourist square left 10 German

nationals dead. Rescuers are continuing to search for one person who is missing after a

deadly avalanche in the French Alps. Two French students were killed along with a Ukrainian skier when they were engulfed on a closed slope.

The avalanche struck at Les Deux Alpes Ski Resort in a popular region there.

U.S. stocks plunged on Wednesday. Oil prices hovered near 12-year lows. The Dow fell as much as 390 points at one point in the trading session

before recovering some of its losses, still closing down 364 points. Speaking to me from the floor of the New York Stock exchange Alan Valdes

from DME Securities told me traders are starting to listen to all of the dire warnings.

(BEGIN VIDEOCLIP)

ALAN VALDES, DIRECTOR OF FLOOR TRACKING, DME SECURITIES: You had all the big houses - JP Morgan, Royal Bank of Scotland.

Royal Bank of Scotland went so far as to say you might as well liquidate everything. JP Morgan said sell on the rallies.

So I think that was heard big by everybody and they started to listen to it and take effect and they were selling on these rallies we saw.

(END VIDEOCLIP)

HARLOW: Falling oil prices may have helped bring about the demise of a U.S. television network. Al Jazeera America, the U.S. sister channel of Al

Jazeera, will close on April 30th after a little more than two years on the air.

The channel is owned by Al Jazeera Media Group which is owned by the Qatari government which is of course a major oil producer.

A turn now to that brutal late selloff in the United States. For markets today technology seems to have taken the brunt of it.

Take a look at the NASDAQ down some 3.5 percent nearly there. Some news just coming in the last few minutes - shares of GoPro have been halted in

afterhours trading. This after the company announced it was cutting its workforce by 7 percent.

Let's bring in CNN Money digital correspondent Paul La Monica. Let's start with GoPro.

This is a company that was riding high for so long.

PAUL LA MONICA, CNN MONEY DIGITAL CORRESPONDENT: Yes, GoPro went public - to

HARLOW: What happened?

LA MONICA: -- it had so much hype around it. Everyone talked about the Hero cameras, they're so cool. You've got this rock star CEO with Nick

Woodman. Well, it looks like maybe the product turned out to be a bit of a fad., maybe just a niche product that wasn't really ready to go mainstream.

Apparently GoPro sales during the fourth quarter - the holidays which is the time you would expect these cameras to be flying off the shelves were

not as high as Wall Street hoped, so the company is cutting back staff. And the stock price has plunged over the past few months. It's below its IPO price which is obviously never a good sign.

HARLOW: No, and I think as our phones can do more and more, people see less and less of a reason for -

LA MONICA: There is a lot of competition. They may have a drone coming out, but even if they do, they're late to that game too.

HARLOW: Let's talk about the "fangs" - I love saying that -- the "fang" stocks. Facebook, Amazon, Netflix and Google all taking an incredible hit

today.

[16:35:04] LA MONICA: Yes, and no teeth for any of them today and I think that's been the case for pretty much the start of 2016. There wasn't any

concrete news to explain why these four stocks plunged and oil price is obviously is helping to push the whole market lower.

I think what you have going on right now, Poppy, is just as oil probably didn't deserve to be at 100, maybe Amazon and Netflix which more than

doubled last year didn't deserve to go to those valuations as rapidly as they did. You know, the market just kind of resetting and wondering what

should these stocks really be trading at?

HARLOW: And why do you think it is tech that got hit the hardest? Because the NASDAQ got hit harder than the Dow and the S&P as a whole. Is it

because, I mean, as you were mentioning Amazon and some of these fang stocks doubled -

LA MONICA: Right.

HARLOW: -- in the last year.

LA MONICA: Yes, the bigger they are, the harder they fall. I think with regards to why the NASDAQ fell as much as it did today, definitely it's

because all of the main companies that are tech leaders in the NASDAQ contributed to that index going down.

Apple which was actually up earlier in the day succumbed to the slide as well. So that never helps since Apple is such a big market cap -

HARLOW: Right, right.

LA MONICA: -- just like Google.

HARLOW: We'll be watching to see what tomorrow will bring. You know, 2 p.m. happened and we all were staring at the market -

LA MONICA: I was writing football stories -

HARLOW: -- wondering what's going on -

LA MONICA: -- today because the market was supposed to be quiet.

HARLOW: Yes, well, you never know. Thank you, Paul. Appreciate it as always.

Here in the United States just about everyone is talking about what they would do with $1.5 billion. Here's an idea - how about a private island in

the Philippines? It's yours if you can pay the rent.

(COMMERCIAL BREAK)

HARLOW: It is a destination fit for a Powerball winner - a private 125- acre island in the Philippines with all the amenities of a hotel. And it is yours for a small daily fee.

However, dreaming about it, that is absolutely free. David Molko has this week's "Business Traveller."

(BEGIN VIDEOCLIP)

DAVID MOLKO, CNN INTERNATIONAL SENIOR PRODUCER: There's no front door, just the wind and the waves on your doorstep. But first you have to get

here and that takes the better of a day -- the very definition of off the beaten path.

By plane from Manila and along village roads. From small boat to big boat. Soak it all in and lose track of time -- until we arrive at Ariara Island.

(Inaudible) thank you.

CARRIE MCCULLOCH, ARIARA ISLAND: Hi there.

MOLKO: David.

CA MCCULLOCH: All right.

MOLKO: Nice to meet you too. My hosts are Charlie and Carrie McCulloch, farmers and property developers from England who had a dream, holed out a map and saw an opportunity. Wow.

CHARLIE MCCULLOCH, ARIARA ISLAND: So there's not very many places like this but it was all sort of my idea of perfection.

CA MCCULLOCH: And it was a challenge, wasn't it? Some parts of it, a lot of - most people would have given up.

MOLKO: It almost sounds like a movie. A couple journeys to the opposite side of the world, overcomes the odds, all in search of their own version

of paradise.

CA MCCULLOCH: An island is the ultimate, isn't it?

MOLKO: The whole island too.

CH MCCULLOCH: Yes. No, yes, a part of an island would not be - wouldn't cut it at all, no.

MOLKO: So they lease the whole thing for the 50 years. And, oh, there's one more thing I've left out that's kind of important - it's the reason

we're here. This can be yours - all 125 acres at your fingertips.

[16:40:02] CH MCCULLOCH: And if they decide they want this table moved over there, it's moved over there.

CA MCCULLOCH: It is also an excuse to play with boats.

(LAUGHTER)

CA MCCULLOCH: Everybody loves water.

MOLKO: Twelve boats and eight villas for just you and up to 20 of your closest family and friends. I know you're wondering about the cost, so

let's get that out of the way. About $500 a day per person - about the same as a luxury cruise. And so did you pick this one for me or -- ?

CH MCCULLOCH: No, you can choose.

MOLKO: And that's the whole idea behind the business - a bespoke holiday taken to the extreme.

So many different options, so many choices.

CH MCCULLOCH: Exactly.

MOLKO: I don't even know where to start.

(LAUGHTER)

MOLKO: Charlie and Carrie seem to have mastered the art of pleasure. But since they normally aren't on the island when it's rented out, all the big

decisions are left to me - from working out the lunch menu to how I like my wind and water.

There goes.

CA MCCULLOCH: Yes.

(DIVES INTO WATER)

MOLKO: Oh, it's nice! That was fun. Time to chill out. It's only when you catch your breath that the magic the McCullochs must

have seen here a decade ago finally sets in. It comes in the rhythm of letting go. In solitude but somehow never

lonely. Thank you. And in the smiles of the island's caretakers. A staff of 30,

some from Araria's closest neighbor, a small fishing village sitting across the water.

What's the name of the village?

UNIDENTIFIED MALE: InaPupuwan.

MOLKO: Ina Pupuwan. Island manager Florian Muller has witnessed the transformation here firsthand. Joey, a former fisherman works at Ariara

and commutes. His wife did too but now looks after their baby.

FLORIAN MULLER, ARIARA ISLAND MANAGER: So it slowly shifted from pure fishing/trading town or village to a village where the fisherman could

improve their equipment so they could catch more.

MOLKO: And there are more fish in these waters, in part because of Ariara's water lease, protecting the corral and its sea life, Florian

explains, allowing both to make a dramatic recovery. But it's almost time to go. More guests are on the way, Charlie won't say

from where though it seems they've been here before. A beautiful day. On this stretch of sand and sea it's easy to forget this is a business. More bookings would be nice Charlie tells me, but they're doing OK. It's a

long-term investment and there is a reason he and Carrie keep the numbers and prices exactly where they're at.

Five, ten years down the line, what do you hope this place will become?

CH MCCULLOCH: It needs to stay in my mind exactly the same concept which is untouched, unspoiled.

MOLKO: Calling this private island home for just a day or two, may be the ultimate pleasure experience, but I've learned that with it comes a great

responsibility - to make sure that those who follow in my footsteps find no trace of me left behind.

David Molko, CNN Ariara Island, the Philippines.

(END VIDEOCLIP)

HARLOW: Beautiful. Well for the first time in more than two decades, America's second largest city will have its own American football team.

The rams, currently located in St. Louis, will now move to a new stadium in Englewood that is just outside of Los Angeles, and the San Diego Chargers

will have the option to share that stadium when it opens its doors in 2019. The decision of where the Rams would play became quite a tug of war between two billionaires. Rival plans were submitted by the owner of the Rams,

Stan Kroenke and Disney CEO Bob Iger. Kroenke who also has a stake Arsenal wanted to move from the Rams move from St. Louis to L.A.

Meanwhile Iger pushed for a plan to relocate either the San Diego chargers or the Oakland Raiders. Kroenke's proposal would see the Rams in a new

stadium in Englewood. Iger wants the Chargers or the Raiders to share a new stadium in Carson.

It is a complicated situation and supporting - and sporting passions I should say - are running high around the country. Our Sara Sidner has

more.

(BEGIN VIDEOCLIP)

SARA SIDNER, CNN NATIONAL AND INTERNATIONAL CORRESPONDENT: NFL football is returning to Los Angeles.

One city's victory is usually another city's loss and that is the case this time around.

ROGER GOODELL, NFL COMMISSIONER: We understand the motions involved of our fans it's not easy to do these things. They are purposefully made hard.

SIDNER: Hard or not, it's a done deal.

(FANS CHEERING "L.A. RAMS!")

SIDNER: This year the St. Louis Rams will now become the Los Angeles Rams.

VIRGINIA (ILLEGIBLE): Finally, I am just happy that Los Angeles is finally getting an NFL team. Rams? Love them.

[16:45:09] SIDNER: The Rams left Los Angeles in 1995. The team returns after a 20-year hiatus. And if there were any confusion over why the team

left St. Louis, the NFL commissioner cleared that right up.

GOODELL: We felt that we needed to have the kind of stadium and kind of project that had the vision, that had the facilities that would really

bring a new kind of fan experience to the NFL and to Los Angeles.

SIDNER: But that is not all. Two other NFL teams got golden opportunities.

GOODELL: This agreement also allows the Chargers to relocate to Los Angeles as well. If they do not exercise that option, the Raiders would

have the option also to move to Los Angeles or to move to Los Angeles with the Rams.

SIDNER: The San Diego Chargers and the Oakland Raiders have been trying to get their respective cities to pony up and pay for a new stadium with

public money, but that hasn't happened. If the teams decide to stay put, the NFL has pledged to put up some of the money, saying it will pay out $100 million to each team.

If one team opts for L.A., it will play in the same stadium as the Rams in Englewood, California.

L.A. Rams fans couldn't be more thrilled to have their team back.

UNIDENTIFIED FEMALE: They never should have left, they belong to Los Angeles, and that's why I get so upset when I even think about any other

team coming here.

SIDNER: For St. Louis Rams fans, the new deal is a bitter loss.

UNIDENTIFIED MALE: C'est la vie. I don't know. Maybe we'll get another team - one that wants to be here, right?

UNIDENTIFIED FEMALE: I think that we've given them all we have and if they don't want it, then move on.

SIDNER: And they are moving on, relocating this year to Los Angeles but they'll be in a temporary stadium. Their new stadium, the Commissioner

says, won't be completed until 2019. Sara Sidner, CNN Los Angeles.

(END VIDEOCLIP)

HARLOW: Despite the absolute toughest of odds, Powerball mania is in full force here in the United States. Here are our tickets. I think - I think

we might win. We'll see. First, though, a highlight from "Make, Create, Innovate."

(COMMERCIAL BREAK)

HARLOW: Never mind the weather or the NFL playoffs, the only thing that people really seem to want to talk about here in the United States is

Powerball. These are our tickets. I think we have really great chances like one in

100 or 292 million - (LAUGHTER) I think that's it. The prize for the drawing on Wednesday night is the biggest jackpot in U.S.

lottery history at $1.5 billion. If nobody wins, it will go up to $2 billion.

The jackpot is so big, it's actually too large to fit on those monitors that you see all over the place. They stopped being able to keep track at

$999 million. Miguel Marquez is live from World Books in Manhattan. Miguel, my friend,

we share an office, I know you have good luck. Did you buy your ticket?

MIGUEL MARQUEZ, CNN NATIONAL CORRESPONDENT: (LAUGHTER). I have my ticket, so everybody here can just go home. Those are the winners right there.

You can throw yours away as well, Poppy. We are at World Books buried deep in the heart of Penn Station here with

all these billion-dollar winners. This is the busiest place in New York state to buy a lottery ticket. One day last week they sold about 35,000 tickets in a single day.

[16:50:10] How busy has it been?

UNIDENTIFIED MALE: Too much busy today.

MARQUEZ: Too much busy. And they said it's not even a busy point at this point. In about a half hour it's going to get insane.

Can I ask you what are you going to spend your billion on?

UNIDENTIFIED MALE 2: I don't know. I haven't really thought about it.

(LAUGHTER)

MARQUEZ: But you're hoping.

UNIDENTIFIED MALE 2: Yes.

MARQUEZ: What will you spend your billion on?

UNIDENTIFIED MALE 3: Billion on? Until I win it, then -- (inaudible).

MARQUEZ: Until you win it. They're not even going to say their plans. What will you spend your billion on?

UNIDENTIFIED MALE 4: Charity.

MARQUEZ: Charity?

UNIDENTIFIED MALE 4: (Inaudible).

MARQUEZ: Well, see, that's a true winner right there. What will you spend your billion on?

UNIDENTIFIED FEMALE: I don't know yet. (LAUGHTER)

MARQUEZ: No one knows! I'm going to spend mine on a yacht and I'm going to buy a plane that will hold a yacht and I'm just going to fly it around

the world, have lunch in different ports around the world and then sort of enjoy myself.

Look, you stand a better chance of getting hit by an asteroid than winning the lottery. You stand a better chance of being struck by lightning than

winning the lottery. You stand a better chance of drowning than winning the lottery.

You stand a better chance of getting struck by lightning while drowning than winning the lottery. But we live in hope and these are the winning

tickets. I've been assured. I'm actually already spending like I've won, so. This place had a $58

million ticket in the Mega Millions last year and they've had four million- dollar tickets along the way. So I just met a woman a little while ago who said, `I've come up from

Florida to buy a ticket here.'

HARLOW: Oh my gosh.

MARQUEZ: This is the winning store.

HARLOW: Wow.

MARQUEZ: So apparently it's a winner.

HARLOW: Apparently but I know you have the winner and I'm already clearing off your desk, Miguel, because I know you're not coming to work tomorrow,

so. Have fun with the $1.5 billion, my friend.

MARQUEZ: It's going to be - it's going to be one of these.

HARLOW: Mike drop.

MARQUEZ: It's the mike drop, you know the -- (LAUGHTER).

HARLOW: Miguel Marquez. Have fun, good luck, my friend. This is a chance, right? There is a chance. Someone always wins

eventually, and if you win you'd want to speak with my next guest right away.

His name, Jason Kurland, he is a partner and an attorney and he joins me now because he's represented several big lottery winners.

Thank you for being with me.

JASON KURLAND, CERTILMAN BALIN ADLER & HYMAN, LLP: My pleasure.

HARLOW: What is lesson number one from the lottery winners you've represented who've won hundreds of millions of dollars? Biggest mistake

they've made, lesson number one.

KURLAND: Lesson number one is they need to take a deep breath, all right? Don't start spending the minute you have the money.

Take a deep breath, let yourself grow into this newfound well. As the months grow and the years grow, you'll figure out who you are and what you

want to use the money for.

HARLOW: OK, you don't have to tell anyone you've won, right?

KURLAND: You shouldn't tell anyone you won as soon as you find out.

HARLOW: But ever? Do you have to -

KURLAND: No yes, in most states.

HARLOW: You have to?

KURLAND: There are only five or six states where you can remain anonymous. In the rest, you have to come forward.

HARLOW: Oh no.

KURLAND: Yes. That's where I come in.

HARLOW: (LAUGHTER), that's where you come in. What is the safest way for people to deal with their money? Because you know what's going to start

ringing off the hook? Their phone. Not just from friends and family but from bankers who would like to invest that money for them.

KURLAND: Without a question. The first thing they need to do is form a team of professionals. Once they do that, -- they find a lawyer, a

financial planner or multiple financial planners, an accountant. You form your team that you trust/you're comfortable with. Then you formulate a plan.

You spread your money around, you let your attorney deal with the investment opportunities and the charity calls and the friends and family -

the ones who, you know, came to your fifth birthday party and all of a sudden coming up and saying `Remember me? I need a few thousand dollars.'

Yes.

HARLOW: Or a few million dollars given this jackpot. The clients that you've represented - we're not giving their names or

anything like that - are they actually happier, richer - that much richer?

KURLAND: I'd say. (LAUGHTER).

HARLOW: Really?

KURLAND: I'd say, yes.

HARLOW: Well no, you heard all these stories about how, you know, it kind of can ruin some people's lives.

KURLAND: It can, it can. But the clients who've come to me, you know, took the right steps. They looked up, they found an attorney, they found a

financial planner. The ones who've really gotten ruined are the ones that just went to claim the lottery the next day, paraded their family around, you know, their kids

are in front of the TV, started, you know, doing the lottery dances -

HARLOW: (Inaudible).

KURLAND: -- of course.

HARLOW: Right. I know you've said there are a few steps physically about what you should do with the ticket if tonight you're watching and you win.

KURLAND: Yes, yes.

HARLOW: What do you do?

KURLAND: First thing you do is you sign the back because it's a bearer instrument. So God forbid you lose that ticket and someone finds it and

your name's not on the back -- it's gone. Sign the ticket, make a copy, put it in the safe deposit box, use the copy

for the validation purposes and don't go get that ticket until the day you're going to claim it.

Next thing you do is you keep quiet. You don't tell friends, you don't tell family, you don't tell coworkers, you don't go on Facebook. If you're

going to go on Facebook, go to shut it down -

HARLOW: (LAUGHTER).

KURLAND: -- and then hire professionals and then you start -

HARLOW: I know this sounds - I know this sounds funny but when you say don't tell anyone you've won and eventually you go claim it, where do you

go claim it? Do you go - you don't go to like the deli where you bought it?

KURLAND: No, there'll be a press conference. So you'll work with the Lottery Commission before press conference.

HARLOW: You can call them? You call your local Lottery Commission?

KURLAND: You just show up. (LAUGHTER). You show up.

HARLOW: I don't even know where that is.

KURLAND: Right. Well then you call us, we take care of all of that.

HARLOW: (LAUGHTER). It's amazing. I hope someone wins tonight and it's going to be great to watch.

KURLAND: Yes, it will.

HARLOW: Thank you so much.

KURLAND: My pleasure.

HARLOW: Appreciate it. We're going to take a quick break. More "Quest Means Business." In a moment.

(COMMERCIAL BREAK)

[16:58:33] HARLOW: Lego has changed the way it will handle big orders. It will no longer ask customers what they plan to do with these Lego bricks

you see. The company came under fire in October for refusing to supply Ai Weiwei

with its bricks. Lego said it didn't want them to be used in the context of a political agenda.

Well the Chinese artist and activist had requested them for an exhibition in Australia. Ai Weiwei responded to the change in policy in his typical

creative style. He posted this picture of himself on Instagram earlier with Legos dangling from his beard and his hair.

And well the only caption he added was a smiley face emoji. U.S. stocks plunged in afternoon trading. The Dow closed down 364 points,

a decline of 2 percent on the day. The S&P 500 and the tech-heavy NASDAQ fared even worse.

All three indices are now in correction territory - that is a decline of 10 percent or more from the peak.

Shares of GoPro down more than 20 percent. That stock halted in afterhours trading. The decline was driven partly by a fall in oil prices.

Brent crude, the global benchmark for oil, touched a $30-a-barrel mark for the first time since 2004. It has come back slightly from those depths.

It is now off 2 percent. The price of U.S. crude is up for the day. That is "Quest Means Business." I'm Poppy Harlow. Thank you so much for

joining us this evening. Stay with CNN for the latest.

END