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Britain Votes to Leave the European Union; Trump: Parallels Between "Brexit" Vote, U.S. Aired 9-9:30a ET

Aired June 24, 2016 - 09:00   ET

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


[09:00:00] CUOMO: But still human.

CAMEROTA: Absolutely.

CUOMO: And they live and experience everything they go through in ways that we can't imagine.

CAMEROTA: Yes. Well, our breaking coverage of the Brexit vote will continue right now on "NEWSROOM" with John Berman, who is in for Carol Costello.

Good morning, John.

JOHN BERMAN, CNN ANCHOR: Yes. Thanks so much, guys. A lot going on today.

NEWSROOM starts now.

ANNOUNCER: This is CNN Breaking News.

BERMAN: Good morning, I am John Berman in for Carol Costello. Thanks so much for joining me.

Brace yourselves, folks. This is an historic morning. The kind of history that could leave your head spinning, stomach unsettled and wallet bruised.

The United Kingdom voted to leave the European Union and the shockwaves are global, political and financial. This will be a tumultuous hour. Wall Street, the Opening Bell is just minutes away. All signs point to huge early losses. This will hit your 401(k) hard. Around the world, stock markets are nearing record losses. Britain's currency, the pound, plunged to its lowest level in 31 years.

Also this morning, Britain's prime minister David Cameron, he announced he will leave office. He is resigning. This after losing in one of the biggest political bets of all time. Someone else will have to lead the UK out of Europe.

And all this as the presumptive Republican nominee happened to be in Scotland to open a golf course, Donald Trump, celebrated his new greens and the British vote.

What does this decision there mean for the election here? Are there messages on immigration, border control, anti-establishment anger that will resonate in the United States?

This is truly a global story with huge implications, we are everywhere this morning. Let's begin with CNN senior international correspondent, Clarissa Ward, she is live outside the Prime Minister's residence at 10 Downing Street in London, where, Clarissa, among other there will be moving vans in the next several months.

CLARISSA WARD, CNN SENIOR INTERNATIONAL CORRESPONDENT: That's right. That's what Prime Minister David Cameron told us just behind me just a few hours ago that in three months he will be stepping down as prime minister.

And, John, when you talk to people on the streets of London this morning, the words that you hear over and over again, stunning, momentous, shocking, historic. People here trying to grapple with a new reality today. They understand now that they live in a deeply divided country. And they are staring down the barrel to a future that is very uncertain with many asking the question, what comes next.

(BEGIN VIDEOTAPE)

WARD (voice-over): A shocking and historic decision, the United Kingdom voting to withdraw from the European Union.

DAVID CAMERON, BRITISH PRIME MINISTER: I love this country and I feel honored to have served it. And I will do everything I can in future to help this great country succeed.

WARD: British Prime Minister David Cameron, who opposed the exit, is showing some stunning news of his own, pledging to step down.

CAMERON: The negotiation with the European Union will need to begin under a new prime minister.

WARD: The Brexit causing major ripple effects around the world, rattling markets and raising complicated questions about trade, travel, and immigration in the EU's 28 country bloc. The U.K. split in its decision. Scottish voters overwhelmingly voted to remain and English voters who mostly supported the exit, apart from London, the capital of the U.K.

AARON BANKS, CO-FOUNDER OF LEAVE.EU: I guess this is maybe the same in America, the Trump style, the haves and havenots. And I think that's what is playing out now. It's been I think a huge political result.

WARD: A key motivation behind the leave movement, immigration.

RAY FINCH, BRITISH MEMBER OF EUROPEAN PARLIAMENT, UKIP: What we want is immigrants who will come to our country and who will be able to contribute.

WARD: The Leave campaign railing against the influx of migrants from other EU countries, pledging to control their own borders.

FINCH: We don't want open-door migration. What happens is big business actually suppresses the wages and the aspirations of ordinary people by bringing in unlimited number of cheap labor.

WARD: Nigel Farage, leader of the anti-immigration UKIP Party and one of the most vocal campaigners to leave, says it's time for Britain to cut itself from the EU's complicated bureaucracy.

NIGEL FARAGE, LEADER, U.K. INDEPENDENCE PARTY: It's independence day. The ordinary, decent people in this country have overturned the establishment, the big banks and the big businesses.

WARD: What's next? A long period of negotiations as the world's fifth largest economy tries to disentangle itself from the European Union.

(END VIDEOTAPE)

WARD: Now the prime minister David Cameron said that he will not actually be the one to implement Article 50 of the Lisbon Treaty that would begin the process of the UK extricating itself from the EU. He will leave that to the next prime minister, the next Brexit government, but from that moment, when that article, if that article is enacted, it is anticipated to be a roughly two-year process, John, to complete the extrication. And there are still a lot of question about what that will look like -- John.

[09:05:06] BERMAN: Clarissa Ward, astounding that the announcement of the resignation of the British prime minister not even the biggest story in the United Kingdom this morning. Just astounding scope of what's going on right there. Thanks so much, Clarissa.

So as the United Kingdom leaves the European Union, Wall Street says hello to chaos. You know, we're showing you -- we have been showing you a countdown clock to the market opening. That's at 9:30 a.m. Eastern Time. Dow futures already down some 500 points this morning.

Let's get right to the floor of the New York Stock Exchange. Alison Kosik is there.

You know, Alison, we like to say the market hates uncertainty. This is uncertainty on steroids.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: And that is exactly why we are expected to see the big selloff when the Opening Bell rings in about a half hour. It's why we're seeing this selloff globally overnight in Asia and right now in Europe.

So what are we supposed to do? Let's bring in an expert here, Teddy Weisberg of Seaport Securities.

You know, we're watching the numbers, what they're going to look like when the Opening Bell rings.

TEDDY WEISBERG, SEAPORT SECURITIES: Right.

KOSIK: Do you think that we're going to see the selloff that's expected and do you think that as an overreaction? WEISBERG: Well, I think we're certainly going to see the selloff

because I think the outcome was a complete surprise. I think most sane folks were betting that we wouldn't have seen this outcome. We would have seen a positive outcome, where, you know, Britain had stayed in the EU. So we all know, we've been doing this for a long time, that the last thing markets like are big surprises and clearly this is a big surprise.

I don't think anybody really knows the longer-term ramifications. You know, there's a lot of rhetoric, always a lot of rhetoric. The end of the day, life will go on. You know, we'll figure it out. We always do. I mean, down 500 or 600 points certainly is painful, but you know, it depends how you want to look at it. We're just sort of giving back the last couple of good days we had and starting over again.

I mean, even oil breaking 4 percent or 5 percent. I mean, oil six weeks ago was trading at $30. So if it goes from 50 to 47, yes, I mean, short-term, it says it's pretty ugly. I think we just need to wait. I think it's way too soon to really figure out where we're going in terms of the markets, and if anything, you know, these kind of selloffs might create some interesting buying opportunities, because at the end of the day, it's the Fed and monetary policy, and in particular, zero interest rates that are the underlying bid for stocks and that's not going to change.

KOSIK: All right, Teddy, thanks so much for your expertise today. I'll let you get back to work.

So, you know, I would say go ahead and see it as a buying opportunity, John, if you are in it for the long haul, if you're diversified and of course if you've got a strong stomach to handle what's about to happen -- John.

BERMAN: Yes, really strong stomach. About 22 minutes until the U.S. markets open. Stay with us for that. It will be interesting to say the least.

Now the vote in the United Kingdom is a big blow to President Obama. He campaigned against the Brexit. He is expected to speak with David Cameron soon. We've already heard from Vice President Joe Biden on this.

CNN's Suzanne Malveaux live at the White House with reaction this morning.

As we said, Suzanne, this is not what the president wanted to see.

SUZANNE MALVEAUX, CNN NATIONAL CORRESPONDENT: Not at all, John. I mean, the White House right now is being very cautious in its tone so they don't incite any kind of alarm or panic regarding this, because you did see the markets, of course.

The president is on the West Coast in Silicon Valley for an entrepreneur summit. We expect to hear from him about 1:45 Eastern Time. As you mentioned, he's going to reach out to the prime minister.

This is clearly not what they wanted. It is a huge blow. We did hear from the vice-president, he is in Dublin, Ireland, earlier today and you can here in his tone here that they are trying to be measured, they are trying to be positive, but it is a very disappointing development.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I don't believe the EU moderates British influence in the world. It magnifies it. The EU has helped to spread British values and practices across the continent. The single market brings extraordinary economic benefits to the United Kingdom. And that ends up being good for America because we're more prosperous when one of our best friends and closes allies has a strong, stable, and growing economy.

(END VIDEO CLIP)

MALVEAUX: And, John, what you just heard there was the president, that was a visit that he made in April to London, really putting his political capital on the line, making the case here that the UK is going to be diminished economically and in terms of making trade deals not only with other countries but also with the United States. So really an extraordinary move on the president's part to get involved with this, just a couple of months ago.

And also, as I mentioned before Vice President Biden weighing in on this, this morning, trying to calm people down here because there are a lot of questions about how this is going to impact our pocketbooks, our 401(k)s. Take a listen.

(BEGIN VIDEO CLIP)

JOE BIDEN, VICE PRESIDENT OF THE UNITED STATES: I prefer a different outcome and I imagine many of you here felt the same way. But as the United States have a longstanding friendship with the United Kingdom, one of world's great democracies, we fully respect the decision they have made.

[09:10:11] America's special bond with the United Kingdom runs deep and it will endure.

(END VIDEO CLIP)

MALVEAUX: John, expect that that is going to be the kinds of words that they're hearing from the president as well. But there is no question about this that this is going to be something that they feel diminishes the United Kingdom and in doing so will diminish the power that it has, that the alliance is strong, but the power that it has in the position, the global position in the economy that is also going to diminish in some ways the strength of that alliance.

BERMAN: All right, Suzanne Malveaux at the White House, thanks so much. You heard the vice president there trying to speak in calm tones. We heard the same from the prime minister of Britain earlier today. They want to calm the nerves right now around the world because people are rattled.

Let's talk about what this all means for the United States and the economy. We're joined by Diane Swonk. She's the founder of DS Economics, the former chief economics at Mesirow Financial, and we're joined again by our senior international correspondent Clarissa Ward.

Diane, let's just put this, you know, in exact terms here. What does this mean for the United States? This could drive the UK into a recession, I've heard you say that, but what does that mean for the United States and investors here?

DIANE SWONK, FOUNDER, DS ECONOMICS: Well, the biggest issue is first of it sideline the Fed indefinitely. The Federal Reserve will not be raising interest rates at all this year, and in fact we've already seen a fairly large move in the doll. The strength of the dollar has been one of the weak spots for the U.S. economy, particularly manufacturing sector, which has been hit hard by its ability to compete abroad. The further strength in the dollar because we're seeing a flight to safety globally into safe assets like the U.S. treasury bond, that will undermine our ability to export and make imports much more cheap.

It also could have some collateral damage on our own election. We've already seen free trade as nearly dead in the United States with our candidates now all backing off any kinds of free-trade agreements and moving towards protectionism that will have impact down the road.

I do think, though, on the flip side that the tired -- we're all tired of austerity, the slow growth that we've seen in fiscal spending, the inability of our own governments to help the economy putting too much pressure on our central banks to carry economic growth. I think Congress and our politicians are getting that message and I do think we'll see some easier fiscal policy going forward, more government spending and lower tax rates.

I think that is something we are going to see. What it means for the deficit is another question, but in the near term, I think the U.S. will have to bear just a little bit of this burden. It certainly means a lot of volatility for our financial markets. I think we'll weather the storms and the (INAUDIBLE) from abroad, but being in a turbulent world is something that we've had unfortunately become accustomed to these days.

BERMAN: Yes. And that turbulence will begin in about 17 minutes when the U.S. markets open. We're watching that very closely.

As we said, there's historic global reassurance effort going on right now among world leaders to tell people this won't be so bad. Among the people we heard from is the former mayor of London, Boris Johnson, who might very well be the next prime minister of the nation of Great Britain.

Listen to what he said.

(BEGIN VIDEO CLIP) BORIS JOHNSON, FORMER MAYOR OF LONDON: This does not mean that the United Kingdom will be in any way less united. Nor indeed does it mean that it will be any less European. We cannot turn our backs on Europe. We are part of Europe. Britain will continue to be a great European power. Leading discussions on foreign policy and defense and intelligence sharing, and all the work that currently goes on to make our world safer.

(END VIDEO CLIP)

BERMAN: You know, Clarissa, Boris Johnson says we are still part of Europe. We are leaders in Europe. But of Europe has to be looking across the English channel this morning saying what on earth have you done?

WARD: Well, exactly, John. And if you listen to the heads of the European Union, they're singing a very different tune to Boris Johnson. We also heard Boris Johnson say, let's not rush anything, let's not hasten. Let's take our time with this. Let's go through this methodically. Whereas EU chiefs this morning were saying we want this to happen as soon as possible, start the process now to exit.

And of course the reason for this, John, is that the EU is now very concerned that essentially Pandora's box has been open here, that the contagion will spread. That other European Union countries will want to follow Britain's lead and also try to leave the European Union. We've heard already today from anti-immigration party leaders in France and also in the Netherlands, both of them now demanding their own referenda, and there is a sense here that this could be a domino effect. That possibly the European Union could be facing certainly the greatest challenge it has ever faced before. And the question is, will it emerge from it unscathed?

You heard one of the EU leaders, Donald Tuss, earlier saying what my father used to tell us what doesn't kill us makes us stronger.

[09:15:04] But I think the jury is still out on whether that indeed will be the case here, John.

BERMAN: All right. Diana Swonk, Clarissa Ward, thank you so much.

Still to come for us, Donald Trump, he was in Scotland this morning. He was asked repeatedly about what happened in the U.K. overnight. What he said a what he didn't say has a lot of people talking.

(COMMERCIAL BREAK)

BERMAN: All right, just a short time ago, Donald Trump praised the United Kingdom's decision to leave the European Union. At news conference at his luxury golf course in Scotland, Trump was quick to compare the Brexit vote to the choice American voters will face in November.

(BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESUMPTIVE PRESIDENTIAL NOMINEE: People really see a big parallel. A lot of people are talking about that, and not only in the United States but other countries.

[09:20:02] People want to take their country back. They want to have independence in a sense. They want to take their borders back. They want to take their monetary back. They want to be able to have a country again.

So I think you're going to have this happen more and more.

(END VIDEO CLIP)

BERMAN: Trump also tweeted that the United States stands, quote, "shoulder to shoulder with a free and independent U.K."

CNN's Sara Murray was live in Turnberry, Scotland, for that news conference. She joins us now.

Sara, fascinating to see Donald Trump right in the middle of it in Scotland today.

SARA MURRAY, CNN POLITICS REPORTER: That's right, John. And he was in the thick of it by accident almost. He is here reopening a golf course that he has in Scotland. And in fact, he spent much of the beginning of his press conference talking about the upgrades here to his course, before he got into the many issues surround the Brexit. But he did say he believes this is the right move by the U.K. Take a listen.

(BEGIN VIDEO CLIP)

TRUMP: You know, this is in such a phenomenon like people are saying. And when people asked me what I thought was going to happen, as you know, I said I think they're going to break away. And it's just turned out that way.

I think it will be a good thing. You're taking your country back. You're going to let people that you want into your country. And people that you don't want or people you don't think that will be appropriate for your country or good for your country, you're not going to have to take.

(END VIDEO CLIP)

MURRAY: Now, obviously Trump sees parallels between the Brexit vote and his own campaign, both in terms of angst about the economy, but also in terms of anger about flows of immigration. But it was interesting to have him here in this setting in Scotland because he was talking a lot about how this might impact the European economy.

When I asked him about the potential negative impact for the American economy, he sort of brushed aside the question. He did say, however, that if he were president, the relationship between the U.S. and U.K. would remain a special relationship. They would still be a very close ally. He said he would not wait to renegotiate the trade deals with the U.K. That's what President Obama kind of held out as a potential punishment that the U.K. would move to the end of the line and Trump says that would not be the case if he is in the White House -- John. BERMAN: All right. Sara Murray at Turnberry in Scotland -- thanks so

much, Sara.

Joining us now to discuss, CNN senior political analyst and senior editor for "The Atlantic", Ron Brownstein. Also with us, Jackie Kucinich, she's the Washington bureau chief for "The Daily Beast".

Ron Brownstein, king of demography, you see similarities in some ways, between what just happened in Britain and the United States, white working class voters, old versus young, people with degrees versus people without degrees. There are some parallels here.

RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: Absolutely. You know, I was over in Europe in May, and there's no question, there's an anti- immigration, anti-globalist strain that is running through the Western world from France to the Brexit to the AFD in Germany.

There are important parallels, as you point out. The generational parallels, young people for remain, older people were for exit. The urban/rural, London 60 percent voted to remain, non-urban was much more for the leave side. And class, 60 percent of white collar in the final polling was for remain, 60 percent of blue collar was for leaving.

But there's one big difference, John, 87 percent of the U.K. is white. And just to extrapolate from the results, probably less than 50 percent of the vote was nonwhite, if Hillary Clinton wins the same share among whites that probably among whites in the U.K., she would win in a landslide. I mean, that is the big difference. Our electorate is much more diverse and allows Democrats to win among weaker performance with working class whites than remain was able to get by with.

BERMAN: Jackie, though, despite that demography, at the very least, what happened yesterday at the Supreme Court, dealing a blow to President Obama's immigration, what happened in Britain overnight with a vote to leave the European Union is seen as an anti-immigrant vote. This gives Donald Trump talking points going forward.

JACKIE KUCINICH, THE DAILY BEAST: Well, absolutely. This also shows that Donald Trump should not be underestimated, because this grievance, this anger at the elites is not just the U.S., it's global. The whole, his "America first" platform, all of that, it was sort of reiterated by the British people at this point.

So it does, it gives him saying OK, look what is happening over there. It's the same thing and they decided to do this. Now, in the short- term, this might benefit Hillary Clinton, because stocks are going to drop, there will be some financial implications here. But in the long-term, this really does, in a way, strengthen Donald Trump's hand.

But it was interesting during that press conference, he spent so much time talking about his hotel and sort of stumbled into this message that really could bolster his campaign.

One more thing, polling was a problem there. The polls said that this was very close and it wasn't at the end of the day. You have to imagine out there in Brooklyn, they're taking a close look at these results.

BERMAN: We have 30 seconds left here, Ron, one of the things Donald Trump said David Cameron did not have his finger on the pulse of what the voters wanted.

[09:25:04] Donald Trump feels like he has his fingers on the pulse of what U.S. voters do want.

BROWNSTEIN: And he does. He's touched a nerve, and you saw the same nerve there. The question is whether -- you know, here, there is just a fundamentally different structure, 80 percent plus unfavorable among minorities just creates a steeper hill than a much more monolithic society there, in which this kind of white working class discontent, which is very real with globalization and immigration was a much more decisive factor than it would likely be here. But again, you know, there's no question, there's a real note here. It's just a very different place.

BERMAN: All right. Ron Brownstein, Jackie Kucinich, thanks so much.

Four minutes and twenty seconds until the opening bell on Wall Street. It will be tumultuous to say the least. Dow futures down 3 percent already.

We'll bring you the opening bell after the break.

(COMMERCIAL BREAK)

BERMAN: All right. John Berman here in for Carol Costello. We're just about a minute away from the opening bell on Wall Street.

We just got a statement from the president of the United States on the European -- the U.K.'s decision to leave the European Union. Let me read that right now, "The people of the United Kingdom have spoken and we respect their decision. The special relationship between the United States and United Kingdom is enduring, and United Kingdom's membership in NATO remains a vital cornerstone of U.S. foreign security and economic policy. So too is our relationship with the European Union, which has done so much to promote stability, stimulate economic growth and foster the spread of democratic values and ideals across the continent and beyond. The United Kingdom and the European Union will remain indispensable partners of the United States, even as they begin negotiating their ongoing relationship to ensure continued stability, security and prosperity for Europe, Great Britain, Northern Ireland and the world."

You can see the president trying to reassure investors here in the United States that things will be okay. What do they feel like on the floor of the New York Stock Exchange right now? Alison Kosik is there.

About 45 seconds to go to the opening bell, Alison.

ALISON KOSIK, CNN MONEY BUSINESS CORRESPONDENT: John, you're seeing traders brace for a rough opening bell in about 40 seconds from now. It is expected that the Dow will drop as much as 500 points at the opening bell.

We're getting an indication of that, as well as overnight, we saw how Asian markets performed. We know the Nikkei fell as much as 8 percent overnight and we're also seeing European markets plunge as well, anywhere from 4 to 7 percent.

It's all happening because of uncertainty, something that the markets just don't like. No one really knows the ramifications of what this Brexit could do to U.S. companies, to the U.S. economies as a whole.

Here you go -- the opening bell.