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EARLY START WITH JOHN BERMAN AND ZORAIDA SAMBOLIN

Alabama Hostage Standoff; Tornado Warnings in Nashville Area; New MLB Steroid Scandal; BlackBerry 10 Unveiled Today

Aired January 30, 2013 - 05:00   ET

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


JOHN BERMAN, CNN ANCHOR: Hostage standoff happening right now. A gun man storms a school bus, shoots the driver --

ZORAIDA SAMBOLIN, CNN ANCHOR: Wow.

BERMAN: -- and kidnaps a child.

SAMBOLIN: We have a live report straight ahead.

And tornado warning near a major city. A possible twister in the Nashville area just moments ago.

BERMAN: A lot going on this morning.

And a baseball superstar, one of the biggest, named in connection with a major cheating scandal -- Yankee slugger Alex Rodriguez -- in a new report on performance-enhancing drugs.

Good morning, everyone. As we said, a lot going on. Welcome to EARLY START, everyone.

SAMBOLIN: And I'm Zoraida Sambolin. Nice to have you this morning. It is Wednesday, January 30th. It is 5:00 a.m. here in the East.

Happening right now, police in Alabama involved in an all night standoff with a suspected gunman, after they say he shot a school bus driver and then took a child. It is happening in Midland City. CNN affiliate WFSA said the bus driver is dead.

Police say the suspect described as a man in his late 60s, grabbed a 6-year-old off the bus, took him to his nearby home. They've been hold up in some kind of underground bunker ever since this all began.

And reporter Josh Rultenberg with CNN affiliate WDHN is live in Midland City. He has the very latest on the standoff.

What can you tell us, Josh?

JOSH RULTENBERG, WDHN REPORTER (via telephone): Well, I can tell that you that as of this hour, the suspect Jamie Lee Dykes and his 6-year- old hostage are still being held in the underground bunker on Dykes' property in Dale County. Authorities say even though the child is still being held, he is physically OK. Now, one law enforcement official indicated to us earlier that the little boy has special needs and is perhaps autistic. The FBI is now in charge of this operation which has been going for now almost 12 hours.

Yesterday, Dykes allegedly boarded a Dale County school bus and demanded at least one child be taken hostage. And that is when the bus driver resisted. We're told by witnesses that he moved to protect the kids and that's when he was shot multiple times by Dykes. The bus driver has since died and since then, Dykes and his 6-year-old hostage have been held up in the underground bunker.

Dykes is believed to be in his 60s. He's white male. Neighbors say he has a history of mental issues and has had a prior brush with the law. Court records indicate Dykes was arrested in December on a menacing charge. He had a court appearance scheduled for today for that charge and it's believed that the shooting and hostage situation is somehow connected to that upcoming court appearance.

Again, the young victim is still being held as a hostage, but is physically OK. Authorities say this could go on for some time because neighbors say Dykes has been working on his bunker for a long time now and we're told that he may have enough food to last several months.

SAMBOLIN: Josh Rultenberg live in Midland City -- thank you very much. I know we're going to continue to follow this developing story and bring you any details as they happen.

BERMAN: What a terrifying night.

SAMBOLIN: Awful, involved a 6-year-old.

BERMAN: It's a scary night and morning for a lot of people and other places in the South. We are in severe weather watch this morning. There are tornado warnings in the Nashville area. This is a live picture from Nashville where there is a threat of hail, high winds and possible tornadoes. Severe weather is stretching from the Deep South, all the way up to East Coast.

Indra Petersons is tracking the storm for us. Good morning, Indra.

INDRA PETERSONS, AMS METEOROLOGIST: Good morning, John. Yes, unfortunately, we're seeing a lot of severe weather through the overnight hours. It has primarily been wind event, about 200 reports of wind and only three reports of tornado. But as you just mentioned, in just the last hour, we have seen now a report of a tornado. We're going to continue to monitor this as it pushed east, with possible area right around Galston (ph) and continue to push off towards the Northeast.

And, of course, the severe weather threat is going to remain with us throughout the day, especially as we start to see things up. Currently, the moderate risk extending from Indiana, all the way down through Louisiana, and these are quick moving storms. So keep in mind, some of the stores are moving anywhere from 50 to 75 miles an hour. So, you're not going to get much time for warning. So, please be aware of your surroundings and, of course, listen to NOAA weather radio.

What we're going to be seeing as we go through the evening hours, actually through the afternoon, Atlanta some severe weather and through the evening, anywhere from mid-Atlantic all the way down through the Southeast, this threat will remain. It will be a little bit less of a risk. So, that's the good news. More on the way some straight lines and some light winds are going to be out there.

But here's where the threat area is. All the way down through the Mid-Atlantic, all the way down through Southeast and that is not going to be the end of the story. This wacky weather is going to continue.

Remember that cold arctic air, really kind of the cause of all this? Yes, it's diving down back to the South and pushing towards the Southeast, and all that cold air is going to go right over the Great Lakes. It's going to tap into all the moisture it's been pulling out of the Gulf and with that, some heavy snow, even some lake-effect snow will be back in the forecast.

So, yes, guys, this wacky weather is not ending any time soon.

BERMAN: All right, Indra. Thanks very much.

And, again, Stay with us. It is a tense morning with the threat of severe weather over the large part of southern America today.

SAMBOLIN: All right. It is five past the hour. The buzz is building on Wall Street.

BERMAN: It sure is.

SAMBOLIN: The Dow and S&P 500 both flirting with all-time highs. Isn't that good news? Stocks closed higher yesterday with the Dow settling within 50 points of the 14,000 mark. It is the Dow's highest level in five years, folks, and it's about 200 points shy of an all- time high. The S&P 500 closed at 1,508 yesterday, less than 60 points from a record high.

BERMAN: So even after the European debt crisis, the fiscal cliff, lingering concerns about unemployment, what has been stoking all the investor optimism?

Well, one of the big drivers is a sector that Christine Romans has been cheering on for months now. So, what do you got, Christine?

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Well, housing, that sector you're talking about right there. But let me first tell you about the Dow and give you kind of lowdown of what's happening here within 200 points of an all-time high. This has been a monster January for your investments. And you got individual investors who are pouring back into the market, so that is helping to push things forward.

You also got defensive sectors, sectors that are less sensitive to the economy. Those are areas where investors are pushing a lot of money because they're worried overall about the pace of economic growth but they think there's something happening here in the economy, slow healing that's going to help corporate profits, because that's what the Dow is, by the way.

The Dow and the S&P, they are a gauge, a temperature, if you will, of how companies are doing, not necessarily how you are doing. So why are they so close to this high again?

The Fed has been stimulating the company for months, actually years now. Corporate profits are still holding in their, companies are making more money, not necessarily with hiring, but they are making more money and that benefits shareholders. It doesn't benefit employees, but it benefits shareholders. So that's what you are when you own stocks.

And that healing economy is something we're seeing piece after piece of data show us. We're going to get a lot more of that data this week. People feel better about housing.

Can I show you home prices? You're feeling a little bit better putting money into stocks again because the value of your biggest asset is rising. In November, year over year, home prices rose 5.5 percent. I haven't been able to say that for years.

BERMAN: That's a good looking graph.

ROMANS: If you're a homeowner, if you're in the market, very low mortgage rates, that's because the Fed has been keeping interest rates very low. We've got a lot to get through, guys, today. Boeing before the bell. Facebook after the closing bell.

We've got a GDP number, a jobs report Friday. There's still a lot of risk in the market, but investors feeling better about stocks. Many people think you'll see all-time highs this week.

SAMBOLIN: That's really fantastic. Those housing prices, are they across the board, across the nation? Or --

ROMANS: What I showed you is a 20 city average. All real estate is local. Defending on where you are, it could be a little bit different. It's been a little flatter in New York, a little flatter in Chicago. But other places, it had a bigger bust. You've seen bigger rises in home prices.

SAMBOLIN: Beautiful. Thank you, Christine.

ROMANS: You're welcome.

SAMBOLIN: I love the good news. Isn't that great?

All right. Seven minutes past the hour.

Another steroid black eye for Major League Baseball. We've been chatting about this all morning. A published report links Yankee slugger Alex Rodriguez and other Major Leaguers to a Florida clinic that is described as the East Coast version of BALCO. In other words, selling performance-enhancing drugs to ballplayers. A-Rod has denied any relationship with the clinic, or its owner, but he already has a track record of lying, you know, about juicing, denying that he doped before finally fessing up for it. That was back in 2009.

Baseball says it is investigating all of the allegations and we're going to get more on the story now from CNN's John Zarrella.

(BEGIN VIDEOTAPE)

JOHN ZARRELLA, CNN CORRESPONDENT (voice-over): The anti-aging clinic was called Biogenesis. It was run out of this office building in Coral Gables, Florida, until about two weeks ago, when it shut down.

Now, the vacant business is in the center of yet another saga of performance enhancing drugs, PEDs, and Major League Baseball players.

A report published in "The Miami New Times" says this clinic was a pipeline to PEDs for several players.

TIM ELFRINK, "MIAMI NEW TIMES": Well, it's clear that Biogenesis, like a lot of anti-aging clinics, was selling an awful lot of HDH, and a number of other drugs that are widely banned in sports: testosterone, anabolic steroids. You know, the records that we've seen indicate that, you know, as for the average population, he was providing these same kind of drugs to professional athletes.

ZARRELLA (on camera): And they're banned substances?

ELFRINK: That's correct.

ZARRELLA (voice-over): According to Major League Baseball, three players named in the article, which links them to the clinic, have already been disciplined under the league's joint drug program.

In a statement, Major League Baseball says, quote, "We are in the midst of an active investigation and are gathering and reviewing information. We will refrain from any further comment until this process is complete," end quote.

Representatives of New York Yankee Alex Rodriguez, identified in the "New Times" article but not named as being disciplined, issued this outright denial. Quote, "The news reports about a purported relationship between Alex Rodriguez and Anthony Bosch are not true. Alex Rodriguez was not Mr. Bosch's patient. He was never treated by him, and he was never advised by him."

Gio Gonzalez, a Washington Nationals pitcher, who was also named in the article, tweeted, quote, "I've never used performance-enhancing drugs of any kind, and I never will. I've never met or spoken with Tony Bosch or used any substances."

(END VIDEOTAPE)

ZARRELLA: Now, the man Tony Bosch who is referred to by both ballplayers in those quotes is reported by "The New Times" to be the man who ran the anti-aging clinic. Now, we tried repeatedly to find Tony Bosch to reach out to him. Have not been able to find him or reach him. The Drug Enforcement Administration would not say whether it is investigating either Bosch or this clinic -- Zoraida.

SAMBOLIN: So, you have a problem with credibility when you've lied in the past. And A-Rod lied back in 2009. So what do you think is going to happen? Do you think that the Yankees will severe ties?

ZARRELLA: Well, you know, it's an interesting point because A-Rod is still owed more than $100 million on his contract. He just had hip surgery recently. There's a possibility he could be out at last half of the season, perhaps the entire season.

Reports certainly indicate that the relationship between the Yankees and A-Rod has gone down in recent years. But, you know, back in 2007, he went on the air in an interview with Katie Couric, we have a snippet of that, where he denied using performance-enhancing drugs.

(BEGIN VIDEO CLIP)

KATIE COURIC, TV HOST: For the record, have you ever used steroids, human growth hormone or any other performance-enhancing substance?

ALEX RODRIGUEZ, MLB PLAYER: No.

COURIC: Have you ever been tempted to use any of those things?

RODRIGUEZ: No.

(END VIDEO CLIP)

ZARRELLA: Now, of course, it came out a year later. A-Rod held a huge news conference over in Tampa during spring training. We were there for that, where he again had to basically admit that he was using those drugs -- Zoraida.

SAMBOLIN: All right. John Zarrella live for us -- thank you.

So I want to ask you a question because this is $100 million. And the reason I'm asking you the question is because you know all things sports. For $100 million, is guaranteed money or --

BERMAN: It is a guaranteed contract. But if he is found conclusively to have used performance-enhancing drugs, it's not impossible the Yankees could try to void part of the contract.

SAMBOLIN: Wow.

BERMAN: It also could be used in negotiations, actually, (INAUDIBLE) higher. With his hip injury, what the Yankees may try to do is just to get him to leave the game so they don't have to pay him and insurance would take over. There's a whole bunch of different possibilities here.

SAMBOLIN: This is really tough stuff to prove, though, right?

BERMAN: Very tough to prove.

SAMBOLIN: Very difficult.

BERMAN: All right. We have other news right now. New developments in the nightclub fire in Brazil. Death now toll stands at 235 after a 21-year-old man passed late last night. Seventy-four people remain in critical condition this morning.

Investigators say the fire was caused by the band's use of a cheap flare intended for outdoor use.

SAMBOLIN: It is 12 minutes past the hour. Before everyone had an iPhone, or a Galaxy, they had a BlackBerry. Could those days actually return? More on the company's comeback attempt, it is launching today. We have a little bit of a sneak peek for you, coming up.

(COMMERCIAL BREAK)

BERMAN: Welcome back to EARLY START, everyone. Christine Romans is here minding your business. Big time, big business news today. She has a preview of the BlackBerry 10 coming out later this morning.

ROMANS: I mean, look, this is the company that pretty much put e-mail in your phone, right? And then it lost its way.

This is the battle of the smartphones. After delaying a release for more than a year, Research in Motion's hotly anticipated BlackBerry 10 will be unveiled. Among its new features, we think, touch screen technology, a redesigned app world, and something RIM is calling BlackBerry balance. That's something to get users the options to have more than one profile, essentially allowing you to keep your business and your personal separate on the same device.

OK. What everyone really wants to know is can RIM stage a comeback. Its shares are up, up from their all-time low four months ago, up here, but take a look at what's happened to BlackBerry over the past few years. The stock over the last three years has crumbled down 76 percent over that period.

A pioneer in smartphone technology, BlackBerry used to be the go-to to, but then something happened, right? Quite simply, it couldn't keep up. It lost a lot of customers to the iPhone and Android, widely considered to be more user-friendly for web browsing and application downloads.

I mean, I want you to look at this pie chart here. BlackBerry commands just 5 percent now of the smartphone market -- 5 percent. Three years ago, it had 20 percent.

Google's Android, look at that -- it had just a sliver a few years ago. Now it has 67 percent of the smartphone market, 4 percent was the -- Android had 4 percent three years ago, now has that big chunk there.

Apple's iOS follows with 20 percent.

What this graph really shows, dramatic changes in the cell phone industry over just the past few years.

Can BlackBerry return to its glory days? They're going to try and we're going to be rolling it all out this morning. We'll have everything and we'll show to you.

BERMAN: It's like the long bomb thrown by BlackBerry here. Big business story. Thanks, Christine Romans, very much.

All right. Eighteen minutes after the hour right now. We want to get you up-to-speed with all the morning's top stories.

Violent protests raging through the night in Egypt. Protesters ignoring President Mohamed Morsy's curfew orders in the political turmoil now threatening the nation's future. Egypt's army chief is warning the clashes could lead on to the total collapse of the very young government. Dozens have now died in six days of protests marking two years since the fall of the last government.

SAMBOLIN: Actress Ashley Judd and race care driver Dario Franchitti are divorcing after 11 years together. Judd was a constant present at the Franchitti's races throughout their marriage. Franchitti just won his third Indy 500 last May. After news of the divorce broke, Ashley Judd tweeted that they will be, quote, "family forever despite the breakup."

BERMAN: It's a sad one. They were a constant presence together.

SAMBOLIN: It was, right? Yes, made me sad, too.

BERMAN: All right. Your turn, South Korea. South Korea announcing they successfully launched their first satellite into space. This just weeks after their neighbor to the north, North Korea, launched their own rocket and outraged the world. South Korea's previous launch attempts in 2009 and 2010 failed.

SAMBOLIN: President Obama with a challenge for Congress: get to work on immigration reform or he will start pushing his own plan. We're going to hear more from the president coming up.

(COMMERCIAL BREAK)

SAMBOLIN: Welcome back to EARLY START. Twenty-three minutes past the hour.

President Obama turning upped pressure on Congress over immigration reform. During yesterday's speech at a Las Vegas high school, he told the crowd the time is now. And he said if Congress doesn't act in a timely fashion, he will put up his own legislation for a vote.

White House correspondent Brianna Keilar explains what's different about the president's plan.

(BEGIN VIDEOTAPE)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Let me start off by thanking everybody at Del Sol High School for hosting us. (CHEERS AND APPLAUSE)

BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT (voice-over): (INAUDIBLE) chose this Nevada high school with the majority Latino student body to roll out the details of what Mr. Obama calls the number one legislative priority of his second term.

OBAMA: The time has come for common sense, comprehensive immigration reform. The time has come.

(CHEERS AND APPLAUSE)

KEILAR: Just 24 hours after a bipartisan group of senators unveiled their outline of immigration reform bill, the president delivered a warning.

OBAMA: If Congress is unable to move forward in a timely fashion, I will send up a bill based on my proposal and insist that they vote on it right away.

KEILAR: Mr. Obama's plan includes a pathway to citizenship for the estimated 11 million undocumented immigrants living in the U.S., requiring applicants undergo background checks, pay taxes and penalty and learn English. It would crack down on employers who hire undocumented workers.

OBAMA: It won't be a quick process, but it will be a fair process and it will lift these individuals out of the shadows and give them a chance to earn their way to a green card and eventually to citizenship.

KEILAR: The president's plan does not outline a guest worker program, nor does it tie a pathway to citizenship to tighter border security, both part of the Senate compromise plan that Florida's Marco Rubio has helped broker.

SEN. MARCO RUBIO (R), FLORIDA: That issue I think is a bright line for most of us that are involved in this effort.

KEILAR: Appearing on Rush Limbaugh's show, Rubio seemed to win him over.

RUSH LIMBAUGH, RADIO HOST: Well, what you're doing is admirable and noteworthy. You are recognizing reality.

KEILAR: Some conservatives fear granting citizenship to undocumented immigrants may encourage more to come.

REP. MARSHA BLACKBURN (R), TENNESSEE: It doesn't matter if it was Clinton or if it was Reagan. What we've learned is if you grant amnesty, what do you get? More amnesty. More illegal entry. And so what we want to make certain is that we have learned those lessons.

KEILAR: Brianna Keilar, CNN, Washington.

(END VIDEOTAPE) BERMAN: So, he'd rather be talking about the game, but instead, Baltimore Ravens star Ray Lewis is answering questions about a new scandal. It has to do with deer antlers. Seriously. You'll hear from him, coming up.

(COMMERCIAL BREAK)