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Fallout From Comey Firing; Federal Court To Hear Travel Ban Arguments; Did Trump Record Conversations With Comey; North Korea Warns U.S. After Missile Launch. Aired 5:30-6a ET

Aired May 15, 2017 - 05:30   ET


[05:30:00] DAVE BRIGGS, CNN ANCHOR: Forty thousand new cases today of this virus and it's terrifying. What you can do to protect yourself in a bit.

Welcome to EARLY START, I'm Dave Briggs.

CHRISTINE ROMANS, CNN ANCHOR: And I'm Christine Romans. It's 30 minutes past the hour this Monday morning.

A critical moment for Donald Trump's young presidency. Who will he nominate to be the next FBI director? At least eight candidates interviewed this weekend at FBI headquarters by Attorney General Jeff Sessions and his number two at the Justice Department, Rod Rosenstein. A White House official says the president will get reports on those interviews and speak to leading candidates, himself, to make a final decision.

BRIGGS: That could happen as early as this week as shock turns to anger over the firing of James Comey. On Sunday, former director of National Intelligence James Clapper warned of the dire circumstances our democracy now faces.


JAMES CLAPPER, FORMER DIRECTOR OF NATIONAL INTELLIGENCE: I think in many ways our institutions are under assault both externally and that's the big news here is the Russian interference in our election system. And I think, as well, our institutions are under assault internally.

JAKE TAPPER, CNN HOST, "STATE OF THE UNION": Internally from the president?

CLAPPER: Exactly.

TAPPER: Because he's firing the checks and balances?

CLAPPER: Well, I think, you know, the founding fathers in their genius created a system of three coequal branches of government and a built-in system of checks and balances, and I feel as though that's under assault and is eroding.

(END VIDEO CLIP) ROMANS: Eroding. Democrats are threatening to block the nomination of a new FBI director unless a special prosecutor is named for the Russia investigation. All this taking the focus off the president's first foreign trip as commander in chief. He departs Friday for Saudi Arabia, Israel, and the Vatican. He also meets today with the Crown Price of Abu Dhabi, and tomorrow he meets with Turkey's president.

BRIGGS: All right. Later today, a federal appeals court will hold a hearing in Seattle to decide whether to uphold the president's revised travel ban. The Ninth Circuit already put the first ban on hold. Will this time be any different? Let's go live to Washington and bring in CNN justice reporter Laura Jarrett. Laura, good morning to you. What do we expect today?

LAURA JARRETT, CNN JUSTICE REPORTER: Hey, good morning, Dave. Well, for the second time in just the last few months the fate of the president's travel ban is back up for debate in the Ninth Circuit in just a few hours, with the Trump administration trying to get the president's executive order back on the track. But the main question the judges have to wrestle with this time around is whether they can look at Trump's campaign statements about calling for a complete shutdown of Muslims entering the U.S. to find that this executive order was motivated by some sort of discriminatory purpose when the face of the order doesn't actually say anything about religion, Dave.

BRIGGS: All right. So, do we know the specific Ninth Circuit judges that are hearing this appeal and how might that matter?

JARRETT: Yes. Today's panel is made up of three judges, all appointed by former President Bill Clinton, only adding to the drama in this case, right, given that the president hasn't shied away from voicing his displeasure with the Ninth Circuit and other courts that have ruled against him in the past, Dave.

BRIGGS: Laura Jarrett, live for us in Washington. Thank you so much.

ROMANS: All right, let's bring in CNN political reporter Eugene Scott to get us jumpstarted on the week with all the politics we're talking about. Let's talk about tapes.


ROMANS: You know, the president hinted that maybe -- threatened -- choose your verb -- about having maybe tapes of this Comey -- this Comey meetings. This is what Republicans -- this is what lawmakers are saying about these tapes, if they exist. Let's listen.


GEORGE STEPHANOPOULOS, HOST, ABC "THIS WEEK WITH GEORGE STEPHANOPOULOS": If there are tapes, will you try to subpoena them?


SEN. MIKE LEE (R-UT), JUDICIARY COMMITTEE: If, in fact, there are such recordings, I think those recordings will be subpoenaed and I think they'll probably have to turn them over.

SEN. CHUCK SCHUMER (D), NEW YORK: If there are tapes, the president should turn them over immediately.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: If there are any tapes, they have to be turned over.


ROMANS: So let's ask the commander in chief, himself, if there are any tapes. He was asked on "FOX NEWS" -- listen.


JUDGE JEANINE PIRRO, FOX NEWS HOST: What about the idea that -- in a tweet you said that there might be tape recordings.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: That I can't talk about. I won't talk about that. All I want is for Comey to be honest and I hope he will be, and I'm sure he will be, I hope.


ROMANS: He didn't deny.


ROMANS: He didn't confirm nor deny but, you know, people who know him -- there's some reporting this morning in some of the newspapers that people who've worked with him over past decades, that he has been known to tape in his office before.

SCOTT: Yes, it wouldn't be surprising. This is not the first time that we have seen a president tape. I mean, I think we have one of our analysts, Julian Zelizer, say that there were at least six presidents who have been known to tape, and so whether or not that has happened isn't clear. But what the president seems to imply was that maybe Comey was doing the taping and that's why he said I hope there are no tapes. But whether or not they exist -- we see these lawmakers definitely want to see them if they do.

BRIGGS: But it sure is interesting the president not letting on if he recorded them.

[05:35:00] SCOTT: Right.

BRIGGS: Sean Spicer refused to answer the very same question.

SCOTT: I don't want to talk about that.

BRIGGS: But the next battle, really, is over the FBI director and who they appoint.


BRIGGS: Lindsey Graham made clear who they do want to see as the next appointee.

SCOTT: Right.


GRAHAM: How about the idea of an FBI agent leading the FBI, promoting within the ranks. There's so many good agents, men and women, out there capable of leading the agency. This is up to the president. He has a duty and obligation to pick somebody beyond reproach outside the political lane.


BRIGGS: Lindsey Graham was also clear that John Cornyn, though a well-respected, highly successful senator would not be the guy that he would suggest in this political environment. Mike Rogers, I guess, would fit that category as well because never, Eugene, have we have a former or current congressman appointed as FBI director. If the president wants someone political, like John Cornyn, can he get them through a Republican-controlled Senate?

SCOTT: I don't think so because I think people are really concerned about the integrity of the investigation on both sides right now, right? They want someone who is involved with the FBI. Despite the conversation, this Russian investigation is just one of many things the FBI is focused on and the learning curve would just be too significant.

I think it's also important to note that one of the things that the president has been most criticized on with the firing of Comey is that he admitted that he asked him to pledge his loyalty to him. The Republicans and the Democrats want someone that's going to pledge their loyalty to the American people and the constitution more than the president, himself. And if you get someone who's going to focus on the president, that wreaks of political motivations more than anything else.

ROMANS: This remark from Clapper yesterday to Jake Tapper -- I'm sorry, it rhymes -- Clapper to Tapper -- but that, you know, the eroding of U.S. democratic institutions --


ROMANS: -- how concerned he is about that from that outside --

SCOTT: And internally.

ROMANS: -- and internally. That's a remarkable statement.


ROMANS: Do you think that resonates this week, politically?

SCOTT: I certainly think it does and I don't think he's the only person who thinks that way. I think we saw from even about the first week that the president came into office some of the people who thought were the biggest threat to intelligence agencies were from the White House. They think -- this is a team that needs to work together to address these issues and some of the challenges they face, they feel like are not coming from abroad or not coming from political opponents or outsiders but this team that they're supposed to be reporting to.

BRIGGS: All right. So ahead of this big first foreign trip that starts Friday, the rumors of a staff shakeup. Axios' Mike Allen reporting that there could be -- Reince Priebus, Sean Spicer, Steve Bannon. Someone could be fired this week but most is centered around communication.

SCOTT: Right.

BRIGGS: What does that tell you about the president?

SCOTT: Well, he has to be aware that this didn't go off as well as he thought it does. He doesn't seem like he may be aware that it may be because of him so if he looks at someone I think it would be the communications team. Now granted, Sean Spicer's head of communications. Last week, some of the biggest stumbles actually came from Sarah Huckabee Sanders, not Sean Spicer. But I think it's fair to --

BRIGGS: Because he's at Naval Reserve duty, to be clear --


BRIGGS: -- we're told.

SCOTT: Fair enough. The biggest miscommunication came last week, though, from President Donald Trump --


SCOTT: -- and so he would have to look at himself first.

ROMANS: And I think that if they did a big reboot this week it would overshadow their foreign trip. I think a big reboot this week would just bring, you know, the palace intrigue back to the headlines. So it's unclear whether he's just venting to friends --


ROMANS: -- or if he's really planning a reboot.

SCOTT: It's just Monday.

ROMANS: Yes, it's just Monday. All right, nice to see you, thanks. North Korea's ambassador to China says missile tests will continue anytime and anywhere Kim Jong Un wants. Pyongyang's latest test reaching a performance level never seen before. We're live in Seoul.


[05:42:50] ROMANS: Growing concerns this morning over North Korea's rapidly developing nuclear program after a successful ballistic missile test over the weekend. The Kim Jong Un regime now claims it is capable of striking the mainland United States. Pyongyang also warns its latest missile test proves it has growing capacity to launch bigger nuclear weapons. CNN's Alexandra Field live in Seoul with the latest developments. Good morning.

ALEXANDRA FIELD, CNN INTERNATIONAL CORRESPONDENT: Good morning, Christine. Certainly, this is a significant launch that is being celebrated in Pyongyang -- celebrated by North Korea as a victory after some failed ballistic missile launches earlier this year. But it's also putting the world on notice and analysts have closely looked at the trajectory of this missile and they consider it significant. They say it went higher, it landed farther than some of the recent previous missile launches you have seen. It actually landed closer to Russia this time than to Japan. You've got analysts in the U.S. who are saying that this demonstrates that North Korea could be capable of carrying out a strike on the U.S. base in the Pacific -- that's Guam.

But the most significant part of this launch for the world is the fact that many analysts believe that this is a significant step forward toward North Korea's efforts to develop an intercontinental ballistic missile. And Christine, you know it is the goal of the regime to build an intercontinental ballistic missile capable of carrying a nuclear warhead all the way to the U.S., so this launch is not the launch of an ICBM. Officials in the U.S. being very clear the trajectory here was not consistent with that but, still, a significant stride forward for a regime that has accelerated its missile testing and that has put a lot into its nuclear efforts and its nuclear ambitions.

This comes just as South Korea's newly-elected president takes office. He's a president who had advocated for a policy of more engagement with North Korea, standing in stark contrast to the harder-line policies of his predecessors. President Moon Jae-in has come now to condemn the latest launch but he says there is still the possibility of North Korea -- of talks with North Korea. However, he insists that the South must send a message to the North that the North needs to change its attitude.

[05:45:00] The White House is also weighing in on the latest ballistic missile launch, calling North Korea a menace, calling on all countries to strictly enforce sanctions against North Korea in an effort to further isolate the regime and attempt to force cooperation from Kim Jong Un. And the White House also putting out a statement saying that President Trump imagined that Russia will not be very happy with the latest launch -- Christine.

ROMANS: All right, putting it all together for us from Seoul this morning. Thank you. Thanks a lot.

BRIGGS: All right, let's talk some sports next. No lead is safe. The Golden State Warriors rallying for an epic comeback against the Spurs in game one of the Western Conference finals.

ROMANS: Hines Ward has more in this morning's bleacher report. Hey, there. HINES WARD, CNN SPORTS CONTRIBUTOR: Yes, good morning, guys. Listen, I thought this game was over. The Spurs, they're up as many as 25 points. It looked like they were going to seal a road win in Golden State but the tide shifted in the third quarter.

Now, watch Kawhi Leonard's ankle as he lands awkwardly on Zaza Pachulia's foot. Now, a lot of people are questioning this -- whether this is an accident or not but either way, though, Leonard was done and this is where the game changed. It was Steph Curry and Kevin Durant catching fire late in the epic comeback. The Warriors win 113- 111. Now, all eyes will be on Leonard's ankle going into game two tomorrow.


ANNOUNCER: There he is, Derek Jeter.


WARD: That's right. One of the greatest Yankees of all time, Derek Jeter, was back in the Bronx yesterday. The Yankees honored their former captain by retiring his number two and putting a plaque with his likeness in Monument Park. Now the crowd, they loved it, chanting his name "let's go Jeter" like they did when he led the Yankees to five World Series. Now, during the ceremony Jeter took the mic to show his appreciation to the fans.


DEREK JETER, JERSEY RETIRED IN YANKEE STADIUM: You know, you play here in New York for 20 years and I learned that time flies, memories fade, by family is forever, and I'll be eternally grateful to be a part of the Yankee family, so I can't thank you guys enough. Thank you very much.


WARD: And some positive news in from NASCAR. Aric Almirola has released from a Kansas hospital after a stunning crash in Saturday night's race. Now, the driver of 43 car fractured a vertebrae after not being able to avoid the wreck in front of him. Now, Almirola's team says he mobile now and is heading back to North Carolina where he'll follow up with his doctor. Some great news for Aric. I mean, get this, they had to cut him out of the car so hearing that he's out of the hospital is a huge relief, guys.

BRIGGS: Yes, that was a terrifying wreck --

WARD: Yes.

BRIGGS: -- Saturday night. Hines Ward, thank you my friend.

WARD: No problem.

BRIGGS: All right, it's being called the world's biggest cyberattack. We'll tell you who it hurts and what you can do to keep yourself safe, next in CNN Money Stream.


[05:52:10] ROMANS: All right, wake up, log on, ouch. Companies around the world bracing for more fallout from that huge cyberattack, maybe the biggest ever. Two hundred thousand users in 150 countries hit by attacks that started late Friday. Law enforcement warns there will be more victims this morning as the work week begins. Already, attacks being reported overnight in China, Japan, South Korea. The virus locks users out of their computers and then demands hundreds of dollars to regain control.

Global companies like FedEx and Nissan, as well as hospitals, universities, even government agencies have been hit by the so-called ransomware. The software targets a flaw in Microsoft Windows. The company released a security patch in March but the virus hit networks that had not updated their systems, which Microsoft stressed the importance of in a statement Sunday, but also said this attack is a wakeup call for governments.

BRIGGS: All right, folks, so what do you do this morning to keep yourself safe? Let's bring in Samuel Burke, live in London for us.

ROMANS: Good morning.

BRIGGS: Samuel, we know more cases already this morning. How do Americans protect themselves right now?

SAMUEL BURKE, CNN BUSINESS & TECHNOLOGY CORRESPONDENT: Well, if you want to know what's going to happen in America this morning just look China which has already had their Monday morning? Forty thousand infections there. Remember, this story broke on Friday in the U.S. -- folks in China already at home enjoying their weekend and now they're going back to work and seeing all these infections, plus we're seeing new strands of this virus. Maybe the group of cybercriminals that did this has altered the code. Maybe there are copycats now wanting to cash in.

But at the end of the day, all you need to do to update your computer to keep safe from this is just make sure you have that latest Windows update -- that annoying pop-up in the right-hand corner that says restart your computer. If you've done that since March, you are safe. And the reason that folks are so upset over at Microsoft is they're saying that this is really all the NSA's fault. The NSA either found this hole in Microsoft or they developed something that could get into this vulnerability. But take a look just how clearly Microsoft is placing the blame on the NSA. I'm really shocked because usually there are all these pleasantries.

ROMANS: You're right.

BURKE: This time, Microsoft saying, "Repeatedly, exploits in the hands of governments have leaked into the public domain and caused widespread damage. An equivalent scenario with conventional weapons would the U.S. military having some of its Tomahawk missiles stolen." We've got to hope the NSA uses these tools to keep us safe, but when the tools get into the hands of the bad guys this is what happens.

ROMANS: It just feels like the Wild West sometimes out there with your own information. So people -- you're locked out, your screen is locked up and you can -- you can talk to the ransomer? You can pay them $300 and they'll just let you go?

BURKE: Imagine a guy steals a T.V. from your house and then knocks at your door and says all right, you want to negotiate, but that's exactly what's happening. Some of these ransomware groups actually want to have good customer service. Now, I can't recommend that you pay $300 to a criminal. You have to decide what your data is worth. Do you have it backed up somewhere? Is there something compromising on that data on your computer that you don't want people seeing that you want to get back?

[05:55:06] But at the end of the day, these groups want to have a good reputation so that people have an incentive to pay. So we even see sometimes at ransomware, they have a little chat service so you can talk to a customer support agent -- a criminal who's also a customer support agent or you can even make phone calls sometimes. So these are the type of situations that, especially, businesses are having to deal with his morning because so many of these groups hit are businesses because these criminals want money and it's businesses that are going to have to pay.

BRIGGS: And, Samuel, the usual suspects are China and Russia but they were hit as well, right?

BURKE: We think of China -- oftentimes we hear from experts as corporate espionage, stealing secrets from American companies. Russia, so often the finger is pointed at them for government spying. In this case, China and Russia some of the biggest victims of this ransomware. Every expert with whom I have spoken has said this is in all likelihood not a state actor, not a government. This is probably a small group of cybercriminals using this exploit to really take advantage of thousands, just going after the money.

ROMANS: All right, update your Windows. Make sure you click on your Windows updates this morning.

BURKE: It's that easy.

ROMANS: Do it. All right, thanks. Samuel Burke in London, thank you.

Let's get a check on CNN Money Stream this morning. More business news for you as futuresin global markets mostly higher despite the possible fallout from that worldwide cyberattack. The Dow and the S&P closed lower Friday, their first weekly loss in three weeks. Wall Street was dragged down by retail stocks. Even in a strong season, retail earnings have been bad and investors will tune in for more this week focusing on, among others, GAP, Target, and Walmart. Walmart has been a bright spot in retail. That's because it expanded its digital offerings, boosting sales. In fact, its online sales last quarter grew at a faster pace than Amazon. Two of Silicon Valley's biggest transportation players are teaming up to make a self-driving car. Lyft and Waymo, the driverless car division of Google parent Alphabet, confirmed they will team up on a pilot car. Each brings an asset to the agreement. Waymo has the software, Lyft has a network of drivers. And this deal is bad news for Uber. Not only are two of the biggest competitors teaming up but Waymo is currently suing Uber for allegedly stealing its self-driving technology.

Homeowners are moving less. The lengths people own their homes rose to 8.7 years in 2016. That's more than double that rate 10 years ago. Ten years ago people were moving every four years. If the housing market is improving why are people staying put? Rising interest rates. Low mortgage rates helped millions buy homes after the recession but as rates rise homeowners worry about higher payments, so economists say many feel locked in.

BRIGGS: And we're due for a few more rate hikes, we believe, this year alone, right?

ROMANS: I think so. I think so, yes. We'll watch that. I mean, interest rates still are historically pretty low. I mean, if you want -- it's still a good time to refinance if you're back in the five percent or higher.

BRIGGS: Right.

ROMANS: But yes, take -- have you refinanced lately?

BRIGGS: No, but look, does it depend on growth if we get another rate hike?


BRIGGS: We need to see higher growth --

ROMANS: Yes, we need to see higher growth.

BRIGGS: -- which we are not seeing.

ROMANS: All right. Thanks for joining us this morning, I'm Christine Romans.

BRIGGS: I'm Dave Briggs. A lot to get to on "NEW DAY" -- James Comey. Are there tapes? A busy day for Alisyn Camerota and Chris Cuomo. We'll see you tomorrow.


TRUMP: I thought that this would be a very popular thing that I did when Iterminated Comey.

CLAPPER: A built-in system of checks and balances that's under assault and is eroding.

NIKKI HALEY, U.S. AMBASSADOR TO THE UNITED NATIONS: The president is the CEO of the country. He can hire and fire whoever he wants.

SCHUMER: The Republicans should be stepping up to the plate and joining us in asking for a special prosecutor.

GRAHAM: If there are any tapes of this conversation they need to be turned over.

SEAN SPICER, WHITE HOUSE PRESS SECRETARY: That's not a threat, it's a simply stated fact. The tweet speaks for itself.

TRUMP: We have a lot of choice. Everybody wants the position. We're going to have somebody fantastic.

REP. ADAM SCHIFF, (D) CALIFORNIA: I would strongly urge the administration to pick someone who is completely apolitical.


ANNOUNCER: This is NEW DAY with Chris Cuomo and Alisyn Camerota.

ALISYN CAMEROTA, CNN ANCHOR: We want to welcome our viewers in the United States and around the world. This is NEW DAY. It is Monday, May 15th, 6:00 here in New York.

The Trump White House looking to put a political firestorm behind them so we begin the week with several stories on the starting line. First, the nation's former intel chief says American democracy is "under assault" by President Donald Trump after the firing of FBI Director James Comey. Meanwhile, Republicans and Democrats are calling on the president to turn over any conversations that he may have taped with Comey.

CHRIS CUOMO, CNN ANCHOR: And, some potential game changers. Deputy Attorney General Rod Rosenstein is going to testify this week before the Senate on the controversial firing. Will he be asked about a special counsel? What will he say? And, President Trump is embarking on his first overseas trip of his presidency. It will begin in Saudi Arabia. This, as North Korea escalates tensions. Another launch, another missile, longer this time. We have it all covered. Let's begin with CNN's Joe Johns live at the White House -- Joe.

JOE JOHNS, CNN SENIOR WASHINGTON CORRESPONDENT: Good morning, Chris. That first foreign trip by President Trump occurring in an atmosphere of chaos both here in the United States and abroad.