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EARLY START WITH JOHN BERMAN AND ZORAIDA SAMBOLIN
Senate Back In Session Today; Holiday Cheer For Retailers; Israel's Defense Minister Resigns; No Regrets For Anti-Islam Filmmaker; Chinese Aircraft Carrier; Protests In Egypt Over Presidential Decree; U.S. Stock Futures Pointing Lower
Aired November 26, 2012 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ZORAIDA SAMBOLIN, CNN ANCHOR: You are not the only one headed back to work this morning. Congress also back in session. And just in time, folks, we are now 35 days away from the fiscal cliff.
JOHN BERMAN, CNN ANCHOR: All right. Gray Thursday, Black Friday, and now, today, Cyber Monday. But just how good are the deals today compared to what was put out this past holiday weekend? We're going to break it all down for you.
SAMBOLIN: And $425 million. Start dreaming. The Powerball lottery just hit a new high and you'll never believe how much the cash payout is. We'll break it down for you coming up this hour of CNN.
BERMAN: A lot of holiday shopping. An interesting Cyber Monday. Good morning. Welcome back to EARLY START, everyone.
SAMBOLIN: I'm Zoraida Sambolin.
BERMAN: And I'm John Berman. It's 6:00 a.m in the East.
Up first, back to work for the lame duck Congress and with 35 days left before we head over the fiscal cliff, a couple of key Republican senators are signalling they're willing to break their no tax pledge in order to get a deal done.
That may be an encouraging sign, because a new CNN/ORC poll shows that 68 percent of Americans believe a visit to the other side of that cliff could trigger major problems, even a crisis.
CNN political editor Paul Steinhauser joins us live from Washington this morning. Paul, of course, the fiscal cliff triggers massive tax hikes and spending cuts if an agreement cannot be reached. You've got some more numbers that show the type of budget plans that Americans really prefer.
PAUL STEINHAUSER, CNN POLITICAL EDITOR: Yes, I guess, they want a balanced approach. Take a look at this. We asked just in this brand- new poll of Americans nationwide, 67 percent, two-thirds or 68 percent actually say you can see it's a major crisis if we jump off the fiscal cliff.
Only about three in ten say, no, it will only be a minor problem or crisis. What do they want in a plan? If we have that number, it's interesting, about two-thirds say it should be a mixture of spending cuts and tax increases.
Only about three in 10 say the deal should be just spending cuts. That is a very big sticking point there among politicians here in Washington, D.C. If there is no budget deal, if there's no deal to avoid the cliff, who gets the blame?
Take a look at this, seems more people will blame the Republicans in Congress than the president, 45 percent saying, the GOP in Congress will be to blame, 34 percent say the president and about 15 percent say, you know what, everybody's going to get the blame if we fall off the fiscal cliff -- John.
BERMAN: But the polls showing Republicans may get a little bit more of it. Maybe they're feeling that a little bit because we're starting to see some Republicans say they may be willing to violate the famous no-tax pledge.
STEINHAUSER: Yes. That pledge goes back to 1986 from Grover Norquist who is now head of "Americans for Tax Relief." And the pledge says this to those who sign it, no new taxes. But also no deductions in -- no deductions or reductions when it comes to tax deductions or credits.
And that's where some Republicans now, John, are kind of leaving that pledge when it comes to that. They're OK with keeping taxes the way they are where they say we have to lower deductions. Take a listen to Lindsey Graham, a Republican senator from South Carolina.
(BEGIN VIDEO CLIP)
SEN. LINDSEY GRAHAM, (R) SOUTH CAROLINA: I want to buy down debt and cut rates to create jobs, but I will violate the pledge, long story short, for the good of the country, only if Democrats will do entitlement reform.
(END VIDEO CLIP)
STEINHAUSER: Lindsey Graham joins Saxby Chambliss, the Republican senator from Georgia who also said the same thing earlier last week. It's interesting, both of these gentlemen are up for re-election in 2014, and maybe they could see primary challenges from the right. Stay tuned on that one, of course, that's a long way away -- John.
BERMAN: All right, Paul Steinhauser live from Washington this morning. Thanks very much.
SAMBOLIN: It's 3 minutes past the hour. An encouraging start to the holiday shopping season, a record 247 million shoppers hit the stores or web sites over the weekend. The National Retail Federation says they also shelled out more money. This is if you compare it to last year.
BERMAN: But, will shoppers still be in a spending mood today, which, of course, is Cyber Monday. Christine Romans is here more on that. Some early cheer for businesses?
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: You know, retailers like what they see here. Remember this is all stretching out. It used to be the Black Friday. The day after Thanksgiving was called Black Friday because that was the day the retailers knew they were going to make money for the year.
If they did well on that day, from that moment forward it was profit through the rest of the year. So Black Friday meant retailers in the black, not necessarily you in the black. Now things have stretched out and you've got them pushing you into Thursday.
You've got Cyber Monday, where they're trying to get your deals on Monday, as well. So, Thursday to Sunday, these are the preliminary numbers and these will be revised no question, $59.1 billion that's up 13 percent from last year.
But the year before, that rose to 16 percent. So it's not as robust growth as we saw the last year. This year you spent on average, $423. Those that were shopping that compares to $398. What were you buying?
Things like, you know, clothing and accessories, toys, almost 40 percent of you were buying books, CDs, DVDs, video games, tech stuff, 37 percent buying electronics, 15 percent jewelry. Remember "Deal News" says this and Valentine's Day the worst time of year to buy jewelry, but you did it anyway.
And about a third of you bought gift cards over the weekend. You're getting your shopping done. Sometimes you're driven by deep discounts. Sometimes you're driven by convenience because now that you've only got a few weeks left until Christmas and you're doing that holiday shopping.
We saw that online sales spiked, as well. Online sales Friday topped a billion dollars for the first time ever. Thursday, in between stirring the gravy and arguing over politics with your uncle, you spent $633 million online.
And it's so interesting, because Amazon was the biggest destination. You saw some of the discount retailers did very well, highest year over year growth, Wal-Mart. You're finding reasons to use technology to do your shopping instead of going out and battling the stores and, in fact, 16 percent growth in mobile sales using a mobile device, 16 percent growth.
Consumers, about one in five consumers are using their phone to make their purchase. How things have changed. It used to be Cyber Monday, which is today, by the way, is a made-up day because retailers want to make sure they can capitalize on the weekend to get even more of your money, but Cyber Monday used to be high speed Internet access at work.
You'd lose productivity on Monday and do the shopping you did over the weekend. Now people are shopping last week. They'll be next week. There will be last-minute deals even in the next few weeks. So things are going to change for the Black Friday phenomenon has become, I would say, a tech holiday phenomenon. It's good if you can change next year.
SAMBOLIN: I'm still shocked by this, 32 percent increase from last year. You would think that people would be in tough times right now, right?
ROMANS: Well, here's the question. Will -- this is it. Will -- this is the big boom and now you won't see a lot more sales, are people done with their shopping? Are we being smart and strategic?
SAMBOLIN: Going to find out.
BERMAN: Only time will tell.
SAMBOLIN: It's 6 minutes past the hour. There's late word in Israel the Defense Minister Ehud Barak is resigning his post. He says he will leave the Defense Ministry in January to spend more time with his family.
Ehud Barak served as prime minister from 1999 to 2001. And two weeks ago, he oversaw Israel's strike on Hamas military positions in Gaza in an attempt to halt rocket attacks on Israeli territory.
BERMAN: The filmmaker behind "Innocence Of Muslims," the crude anti- Muslim short film that ignited protests in the Islamic world says he has no regrets about making the film.
In written responses relayed through his attorney, Nakoula Basilly Nakoula also told "The New York Times," he had no regrets about how he treated the cast saying they signed contracts that did not prevent changes in the scripts.
In additional to deadly protests, the film also led to Nakoula's arrest for violating his supervised release on a fraud conviction. He's currently serving time in a Los Angeles jail.
A powerful gas explosion that leveled a strip club in Springfield, Massachusetts, last week was caused by human error. At least 21 people were injured by the blast, including 12 firefighters and 2 police officers. Officials say a utility worker inadvertently punctured a hole in a high pressure gas line while responding to calls about a gas odor.
SAMBOLIN: The man who helped China develop its first aircraft carrier dies of a heart attack over the weekend as he watched his country's first successful landing at sea.
The 51-year-old Luo Yuan was chairman and president of the aircraft company and was also in charge of China's fighter jet program. Luo was on board the new carrier over the weekend to watch the J-15 jet he designed come in for a landing when he suffered a fatal heart attack.
BERMAN: And even if you don't normally play the lottery, it might be hard to resist buying a ticket for Wednesday night's Powerball drawing. There were no winners Saturday night. A $325 million jackpot then, so Wednesday night's jackpot is a record $425 million. That number could go even higher depending on ticket sales. SAMBOLIN: It will.
BERMAN: The previous high for Powerball was $365 million in 2006.
SAMBOLIN: All right, 8 minutes past the hour. Major prescription drug is under recall this morning. Apparently listen to this, glass was found in some of the bottles. You're going to find out which one right after this quick break.
SAMBOLIN: Welcome back to EARLY START. It's 12 minutes past the hour. It is a busy morning across the Middle East. Egypt's president meets today with that nation's highest judicial body.
It is an attempt by Mohamed Morsi to explain the extraordinary powers that he granted himself on Thursday, which some judges have called an unprecedented attack on the judiciary.
Among the moves Morsi decreed, judges cannot overturn any decision that he makes, or law that he imposes, until a parliament is formed. Thousands of Egyptians have taken to the streets in protest, many accusing President Morsi of an all-out power grab, some calling him a dictator.
This internal unrest is happening as representatives from Israel and Hamas are in Cairo for separate ceasefire talks with the Egyptians. Helped broker an end to the fighting last week between those two sides.
Israel's Defense Minister Ehud Barak just announced his resignation. Reza Sayah is in Cairo. Reza, we know the anti-Morsi protests have continued this morning. What is the scene like right now?
REZA SAYAH, CNN INTERNATIONAL CORRESPONDENT (via telephone): They're still out there. We've seen pockets of clashes. Of course, we have the first fatality happened last night, a 15-year-old boy killed, a member of the Brotherhood.
At this point the Muslim Brotherhood doesn't seem to be using the fatality as a rallying cry to shore up the borders, but there doesn't seem to be a resolution in sight to this conflict. Leaders of the opposition faction still want the president to reverse his decree.
The president has said no. He's defended the decrees and insists these are decrees that are designed to protect the revolution and move forward with the democratic process. But his critics are still out, some of them saying they're not leaving until he reverses his decision.
SAMBOLIN: Well, we understand the judges are --
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: -- withdrawn, secondly I would hope that he starts to listen to the people. UNIDENTIFIED FEMALE: I am willing -- just like we did with Mubarak. We are going to oust him.
(END VIDEO CLIP)
SAYAH: Now today Mr. Morsi and the Muslim Brotherhood are scheduled to meet with the judges, the Supreme Judicial Council, that's one of the groups that his decrees undermine. The problem is, there is no dialogue to get to the leaders of some of the other oppositions.
SAMBOLIN: And their stock has plunged by more than $4 billion as well and the judges are threatening to strike so even with all of that, no decision for Morsi to revoke that decree?
SAYAH: Well, we just spoke to one of his senior advisers, and he seemed to suggest that he might consider it, but many will say that if he backs up, it would be a politically wrong move for him. That it will be a sign of weakness. For now, there are no indications from his office that he wants to reverse the decree.
SAMBOLIN: And, Reza, just as we were going on air, Israel's Defense Minister Ehud Barak resigned. How could this affect today's talks between Israel and Hamas?
SAYAH: It's not clear how Ehud Barak's resignation is going to impact these talks. But I doubt these talks are going to fall apart. The decision for a cease-fire last week were made by the top officials in Tel Aviv, not just one person. But certainly moving ahead, Mr. Barak is not going to be part of these talks.
Here's his explanation of why he resigned.
(BEGIN VIDEO CLIP)
EHUD BARAK, ISRAELI DEFENSE MINISTER: I feel it is important that other people should take leading positions in Israel. Changes in the positions of power is a good thing. There are many ways to contribute to society and the country, and not necessarily to politics.
(END VIDEO CLIP)
SAYAH: Today in Cairo, both sides, the Israelis and Palestinians, are going to talk about the conditions of the cease-fire that has yet to be agreed on, important topics like Gaza's border crossings, Israel's economic blockade in Gaza, the firing of rockets from Gaza into Israel. All of these complicated issues on the table for these talks today.
SAMBOLIN: So much going on. Glad to have you there. Reza Sayah live in Cairo for us -- thank you.
JOHN BERMAN, CNN ANCHOR: It is 16 minutes after the hour right now.
A lot going on this morning. Christine Romans here with top stories.
ROMANS: Good morning again you two. A fire that broke out at a garment factory in Dhaka, Bangladesh, this morning is under control, with no deaths reported. This happens just two days after another fire there killed at least 120 workers. Authorities still don't know what caused the eight-story blaze Saturday night. The company that owns the factory manufactures products for Wal-Mart, and other companies in the U.S. and Europe.
Hurricane Sandy has sparked a new jobs initiative in New York City. Temporary jobs for 5,000 young adults are being offered in areas that were hard-hit by that storm. Any adult affected by Sandy can apply. But this initiative is geared specifically to young people ages 18 through 24.
(BEGIN VIDEO CLIP)
PETER RIVERA, NY STATE LABOR COMMISSIONER: When you look at communities like this, it's this community -- it's that age bracket that has the highest unemployment. So, doing a twofer here, we're trying to tackle the unemployment problem in an area like this where the unemployment for that age group can run as high as 36 percent, 40 percent.
(END VIDEO CLIP)
ROMANS: And getting something concrete on the resume is critical, too. The jobs will be for short-term and long-term projects aimed at rebuilding communities affected by Sandy. The new initiative expected to last up to six months.
A popular medication used to reduce cholesterol is now under recall because the bottles of pills may also contain small particles of glass. Manufacturer Ranbaxy says the recall affects 41 batches of 10, 20 and 40 milligram tablets of Atorvastatin Calcium, the generic version of the widely prescribed anti-cholesterol drug, Lipitor. It's the generic version of Lipitor.
Please check your medicine cabinet.
Sunday night football -- the defending champion New York Giants ending their November swoon with a 38-10 rout of the Green Bay Packers. Eli Manning threw three touchdown passes to snap a two-game losing streak. It's two games really of losing streak. OK, a couple of bad games. It knocked the packers out of first place tie with Chicago in the NFC north.
Take a look at this. This is the third quarter shower? Delaying the Seahawks/Dolphins --
ROMANS: -- game in Miami yesterday. The stadium sprinkler system malfunctioned. It thought it was Saturday. The players toweled off, the game resumed. The Dolphins went on to beat the Seahawks, 24-21. It was some real, like psychological ops. What they call that?
BERMAN: That's right. Psy ops, they're messing with your head there. ROMANS: Anyway.
SAMBOLIN: Thank you.
It is 18 minutes past the hour. Coming up, quick check of the markets on this Monday morning. Stay with us.
BERMAN: Minding your business this morning. Christine Romans here with a look at what's ahead for the week in the markets.
ROMANS: It was a good week last week, with futures a little bit lower this morning. So, not really that much of a surprise when you saw such a good week for a shortened holiday week last week. Last week, you had the Dow, NASDAQ, and S&P 500 each up more than a percentage point, and it's because there's slow healing in the jobs market, notable improvements in housing.
And the idea last week that maybe -- just maybe -- 535 people would not be completely insane and drive us off the fiscal cliff. So, the idea that they're talking about something helped the mood last week.
This week, in focus, the housing market, the manufacturing sector, consumer data. We'll get regional reports from the Federal Reserve.
We'll get the GDP, gross domestic product, report. Very important to show us about the broader health and the economy. We expect it's going to show economic growth has picked up.
Quick note for you on housing: this is a really important part. You know, there are three legs of this stool that is your personal -- on your personal finances, right? It's your job, it's your investments, it's your house.
Your house, a few of you are under water. Mortgage rates are so low, more of you are taking advantage of those low rates. A 30-year fixed rate 3.31 percent; 15-year fixed rate, 2.63 percent.
That is the popular refinancing tool. And if you have a good credit score and you're not you under water you're unto get more money -- more money in your pocket by refinancing and more and more people are doing that. That's something we're starting to see through the economy, slowly, slowly, but surely, and we're going to see more of that this week.
If -- something you were telling me that you can't afford -- you can't do it because your credit score isn't good. You're having trouble with your -- look mortgage rates will probably stay low for some time, so use this time to repair your credit. The best way to repair your credit is to pay your bills on time, every time. Pay them on time every time.
BERMAN: One more time?
ROMANS: On time every time holiday shoppers. Remember, you know, if you're -- if you haven't saved for your kids' college or you're not paying down your debt and you're buying holiday presents, remember, that's the one thing you need to know today. When the whole world is trying to get you to spend money over the next four weeks, pay yourself first. The same America that's complaining about not having money saved for college is the same America that's running out and waiting in line for door busters -- pay for yourself first before you go out and pay for retailers bottom line.
ROMANS: Wise, wise words. Christine Romans, thank you very much.
Want to know if you're at risk for Parkinson's disease? Well, one man has developed a very simple way to test for early indicators. All you need to do is speak. Check out this preview of "THE NEXT LIST".
(BEGIN VIDEO CLIP)
DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: I'm Dr. Sanjay Gupta. This week on "THE NEXT LIST", meet Max Little -- a math whiz and innovator with a surprising goal.
MAX LITTLE, MATH WHIZ: So, my name's Max Little and I'm aiming to screen the population for Parkinson's disease using voice match.
GUPTA: Max Little has a bold idea. What if doctors could detect Parkinson's disease simply by the sound of your voice?
Max little is close to proving just that. He says one simple voice test can determine if someone has Parkinson's. And all you need is a telephone.
LITTLE: We've got an ultralow-cost way of detecting the disease.
GUPTA: Watch how Max Little's surprising idea taking shape this Sunday on "THE NEXT LIST."
(END VIDEO CLIP)
SAMBOLIN: That's a must-watch.
BERMAN: Very cool.
Twenty-five minutes past the hour.
So imagine that a city shredded a bunch of paper with Social Securities that were printed on them. And then imagine that they used that shredded paper as confetti during a huge Thanksgiving Day parade. It happened, folks. We have all of the details, straight ahead.
BERMAN: This morning, we're just 35 days away from the fiscal cliff. What it means for your money, and the country's money, straight ahead.
SAMBOLIN: Confetti filled with Social Security numbers. That's a drop from the sky during a major Thanksgiving Day parade.