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Investors Brace for Bumpy Ride; Biden on Trump's Treason Comment; Biden on Trump's FBI Attacks; Biden on 2020 Run; Planning for Military Parade; Kim Jong-un's Sister in South Korea; Pence on North Korea. Aired 9:30-10a
Aired February 7, 2018 - 09:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:30:00] CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: But then you start to see some stability, so we just don't know. This is what happened after all these months of just moving higher without a correction. You've got a market now that is trying to search for a correction to find out what to do next.
JOHN BERMAN, CNN ANCHOR: All right, no coincidence, the American Red Cross down there for the opening bell, healing perhaps the frayed nerve on Wall Street.
So, you know, seconds in to the trading day, down 51 points, 64, going down right now.
Cristina Alesci is on the floor of the exchange.
You've been speaking with traders. What's the mood?
CRISTINA ALESCI, CNN MONEY CORRESPONDENT: The mood is calm right now, I mean guarded, but it can change at any moment. And that really is the theme of the day, as Christine pointed out, volatility is back.
I was here on the floor yesterday watching this dramatic close of over 500-point move upward. John, that's just incredible, especially because we have so many months and years really of a straight shot up in the market.
Things are changing and things have changed at this point. And the big question now isn't -- is whether or not we've reached the end to the bull market or whether or not this is a buying opportunity. That are -- that -- those are the -- that's the --
BERMAN: Uh-oh. Cristina Alesci down there. You get a sense of where the market is. It went down as low as, you know, 125 points down or so. Now down about 78 points.
Cristina Alesci was saying is this, the end of the bull market.
One thing is clear, Christine Romans, you know, it's the end of cheap money, right?
ROMANS: Oh, yes.
BERMAN: It's -- and if there are signs that inflation might be setting in at some level, which means that --
ROMANS: A little bit of inflation.
BERMAN: Corporate profits could suffer a little bit and goods and services could become more expensive for consumers.
ROMANS: Look, all the global markets have been addicted to cheap money for several years and that's the Fed keeping interest rates artificially low to rescue the economy, right, from the terrible, terrible crisis we had a decade ago. And that era is over. And it's been painful as markets and investors have been coming to grips with that. It means the bond market is where a lot of the action is. More action, honestly, than the stock market. It's a bigger market. And the bond market has been telling us interest rates are rising. And you saw a four-year high on Friday of the ten-year note. So that's telling you that there are -- there's a change in psychology here.
But the underlying economy is strong, John, and that's actually why we're talking about inflation, right? The economy is strong. The job market is strong. Corporate profits are strong.
There is still a lot of Wall Street professionals who have their S&P 500 target, John, higher at the end of the year than it is today. So they're still hoping for gains. But it could be really complicated along the way. I think those days of 1,000 points every couple of weeks on the Dow are over.
And, remember, the Dow is 30 stocks. The S&P 500 really is the big gauge of stock market health. And we're talking about percentages. That's important. A 4 percent or 5 percent move is a big move. These days a 200 or 300-point move in the Dow statistically is not a big move.
BERMAN: All right. This morning off the major -- it was down about 125 points. Now only down about 25.
Cristina Alesci, you know, the American Red Cross pulled the plug on you down on the floor. Again, finish your thought.
ALESCI: For a good cause.
Look, what I'm hearing in summation is, this was a healthy market move in a sense that we need to -- the market needed to come down at some point, right? So the correction is fairly healthy.
What was unhealthy about it is that it actually happened in a very short period of time. That's what has investors unnerved. I think they would have liked to have seen a correction perhaps over the next couple days or weeks even and not such drastic moves. And I think that's what investors are trying to get their heads around.
And, of course, there's a distinction here between passive investors, and we're talking about essentially computers and algorithms --
BERMAN: Right. ALESCI: And active investors in the market. And a lot of active investors, money markets, pensions, those kinds of investors, they seem to be treating this, for now at least, as a buying opportunity, although we are watching the indices go a little bit lower right now, John. So we'll keep an eye on it.
BERMAN: Relative calm, which I think is welcome by investors this morning.
Cristina Alesci down on the floor of the exchange, Christine Romans here with me in New York. We will keep our eye on it. But right now, so far, seems to be a bit of a different day.
So is former Vice President Joe Biden seeing 2020? Get it? He may have just given us a clue. CNN's exclusive interview coming up.
[09:38:18] BERMAN: So White House Press Secretary Sarah Sanders said the President Trump was clearly joking when he called Democrats treasonous for holding their applause during the State of the Union. But former Vice President Joe Biden, not laughing. Here's part of his exclusive interview with CNN.
(BEGIN VIDEO CLIP)
JOE BIDEN, FORMER VICE PRESIDENT OF THE U.S.: I just -- I just marvel at some of the things he says and does. Like, what, two days ago, anybody who didn't stand up and clap for him was un-American and then maybe even treasonous? I mean what the hell.
CHRIS CUOMO, ANCHOR, CNN'S "NEW DAY": They say it was tongue-in-cheek. Democrats can't take a joke.
BIDEN: Well, let me tell you, he's a joke.
(END VIDEO CLIP)
BERMAN: Joe Biden not mincing words because Joe Biden doesn't mince words.
DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: No, he doesn't.
BERMAN: That interview obviously with Chris Cuomo.
Joining me now, CNN chief political correspondent Dana Bash, a keen watcher of Joe Biden for a long time.
What did you make overall of the former vice president?
BASH: Look, he is somebody who kind of always understands and always understood how to articulate where things are politically. He somehow has historically been able to get away with saying things that other regular politicians have not been able to do.
Having said that, in particular interview, I did think it was interesting that on the key political question about where he's going to go next, and whether he's going to run, he insists that he's leaving the door open, but he was very keen on hitting home the very important political points that he needs to hit for the Democrats. Well, I am liberal. I'm very liberal, which is where the party clearly is right now. But I also know how to talk to working class Democrats, which is critical if you want to win back some Trump voters.
So I thought that it was very human, very emotional, but also very politically savvy.
[09:40:05] BERMAN: Dismissive. You know, calling the president a joke was also interesting to him say in those terms.
He was asked -- Chris asked him about the overall investigation right now, the Russia investigation, the back and forth on the memos. And it was interesting the way he responded to that. Let's listen.
(BEGIN VIDEO CLIP)
BIDEN: This is the first president to make a full-throated, unvarnished attack on the entirety of the FBI.
What do you think they're thinking in Moscow? This is doing everything that Putin ever wanted. Sewing doubt about whether or not our justice system is fair, sewing doubt about whether or not there is anything that is remotely consistent with our Constitution. It's just -- it's just -- it's a disaster.
(END VIDEO CLIP)
BERMAN: You know, when I saw that, it was a political response, but in some ways it's also an institutional response.
BERMAN: Because Joe Biden, you know, in government for decades and decades, chairman of Judiciary for a while, too. It was -- it was notable.
BASH: It absolutely was. And, look, he's right, I think amid all of the toing and froing about the memo and about, you know, the Mueller investigation, we do, all of us, lose sight of the big picture, which is that the Russians won because this is -- this discord is exactly what they were trying to sew.
Having said that, I thought his non-answer to Chris' important question about the fact that his administration, the Obama administration, knew about this, didn't raise enough flags certainly in public because they thought it would be perceived as too political, that is something that if he does run and if his is take -- his answers are taken through a different prism, which as somebody who wants to be president, is not going to be satisfactory.
BERMAN: No, he'll have to answer to that for sure. And I expect it will become an issue in the Democratic primaries whether or not he's in there. It will be interesting to see how candidates use that charge.
You're talking about Joe Biden's future. This is something that the vice president has been asked a lot, including during the last campaign when he, you know, mused about whether or not he would get in and the conversations that he had with his late son beau. Listen to this.
(BEGIN VIDEO CLIP)
BIDEN: We were sitting at the dining room table a couple of months before he died and he said, dad, can you stick around? And I said, yes. And he looked at me and he said, dad, I know no one in the whole world loves me more than you do. But he said, dad, I'm going to be OK no matter what happens. Promise me, dad. Promise me, dad, you're going to be OK. What he meant was that I wouldn't walk away from my obligations. I wouldn't walk away. He knew I'd always take care of the family and they'd take care of me. But he wanted to make sure I stayed in the public arena. That's all I've done my whole life.
(END VIDEO CLIP)
BERMAN: All right, first of all, every parent and every child should share the love that clearly Joe Biden shared with his son Beau Biden, and all his kids right there.
But to the question of Joe Biden's future, as you noted, he never answered Chris directly about whether or not he's going to run. But he made sure if he wants to, he checked all the boxes there. What do you think?
BASH: Yes, I think that, at this point, it's more likely that he does than doesn't.
BERMAN: More likely that he does.
BASH: I do. I think it's more likely that he does than doesn't.
Having said that, he's got a lot of time to decide.
BASH: And I do think again going back to the way that he answered the questions about the -- where the Democratic Party is, he sees himself as somebody who can bridge all of the different factions of the Democratic Party. The issue is, which is not a small thing, generational. He would be, as David Axelrod pointed out, 82 years old at the end of his first term if he -- if he runs. There's that, and there's just the question of passing the baton to the next generation and whether it's time to do that, because there are a whole lot of people waiting in the sidelines who are the next generation.
BERMAN: Yes, look, I mean he's run for president twice also unsuccessfully, spectacularly unsuccessfully.
BERMAN: Spectacularly unsuccessfully. And, yes, I mean, he -- look, I think the people who know him and love him, who we talk to in the Democratic political world, say that he is a much better vice president, much better -- I mean, in this case, you know, interview him, political analyst, than he is a candidate. But having had the experience of eight years as VP, maybe it would be different.
BERMAN: You know, Chris Cuomo noted, Democrats are all going to have to answer this question, why are we better than Joe. You know, prove that you're better than Joe Biden as a candidate. That will be a bar until Joe Biden makes clear his intentions.
Quickly, we have a few seconds left. We may be on the verge of a big spending deal inside the Senate right now, the likes of which we haven't seen in a long time. Two years, basically, which is an eternity in Washington.
BASH: That's right.
BERMAN: But this -- this is sticking it to the House.
BASH: Absolutely. Look, at the end of the day, the Senate, Republicans and Democrats, have -- if they do come forward with this deal, if they are able to pass it, have something which deals with all of the -- that long to-do list that we started out this year with that Congress has. The budget caps, the fact that there's concerns among conservatives about military spending not being high enough, about children's health, about disaster relief. So this is a package that the Republicans and Democrats in the Senate feel that they have a pretty good deal on. The Republicans in the House, particularly those in the Freedom Caucus, are likely not going to be happy about it. But this is going to be a question about whether they're, for lack of a better way to say it, just going to have to get stuffed by the Senate Republicans or whether they're going to put up a fight.
[09:45:16] BERMAN: Liberal Democrats in the House don't love it either. We had Eric Swalwell on a few minutes ago.
BERMAN: He wasn't jumping up and down exactly either.
BASH: No, but that's what compromise is.
Dana Bash, great to have you with us. Nice to see you in person.
BASH: You too.
BERMAN: All right, the commander in chief has a new directive for the Pentagon, plan a big military parade, like this one you're seeing here, but only bigger and better. And it won't come cheap.
[09:50:03] BERMAN: So the president likes parades and wants one of his very own. What he wants to do is the U.S. military to show off its might. He's calling for a parade with tanks, troops. Planning is now underway. The idea reportedly was sparked when the president attended the Bastille Day Parade in France and vowed to top it.
Joining me now, CNN Pentagon correspondent Barbara Starr at the Pentagon where the planning is taking place.
BARBARA STARR, CNN PENTAGON CORRESPONDENT: Planning is underway. In fact, the chairman of the Joint Chiefs of Staff confirmed that earlier today, General Joseph Dunford, planning is underway.
So what are we talking about? One of the options on the table now for the Pentagon is to have some sort of parade, if you will, on -- in November, which would commemorate the 100th anniversary of the end of World War I on November 11th in 1918.
That might be a partial solution to one of the big concerns that you privately hear people talk about already, which is, if the U.S. military is going to show off its might, its tanks, its missiles, it's guns, it's not really U.S. military tradition. And what you are celebrating at that point? Are you celebrating troops or are you celebrating 16 years of the U.S. military being directed to carry out wars largely in Islamic countries? It's a very delicate point that it actually is the reality.
There is a great tradition in this country of honoring the troops, honoring veterans as wars conclude. We saw that after world war ii when the veterans of Vietnam were not honored when they came home, it became a blight that lasted for years. They had no welcome home.
In 1991, in fact, President George H.W. Bush held a celebration in Washington, D.C. with the commander Norman Schwarzkopf. There was a parade. People turned out. It was a great patriotic celebration. But troops were still fighting overseas. That's what you're facing right now.
If there is a parade, if there are tanks and missiles rolling down Pennsylvania Avenue, as President Trump perhaps is suggesting, it is something that could cost millions of dollars at a time when the Pentagon says -- Defense Secretary James Mattis says they are strapped for every penny they need to fight wars, to improve lethality, to modernize, to support military families.
So I think, John, there's going to be a lot of questions about all of this. Celebrating the troops, yes, celebrating veterans, absolutely, but is rolling tanks and missiles down Pennsylvania Avenue really the way -- the best way to go about it?
BERMAN: Very quickly, Barbara, speaking of parades, North Korea holding one tomorrow.
STARR: Yes, they don't really ask those questions, do they, in Pyongyang?
BERMAN: No. STARR: Kim Jong-un ordering up a big parade. We will see it tomorrow, threatening to show off perhaps hundreds of missiles. But the North Korean regime being very careful in what it shows the world. They are restricting media coverage of it. They say they will have the only cameras filming it, showing it to the world. So this will be very much an effort to see whether their parade is actually realistic. Are they showing new weapons or are they showing us old stuff.
BERMAN: Barbara Starr at parade headquarters in the Pentagon. Thanks so much for being with us, Barbara. Appreciate it.
Speaking of Kim Jong-un. His Olympic delegation in South Korea has a surprise member. The North Korean dictator sent his sister. This is the first time any member of Kim's family has ever stepped foot in South Korea as far as we know.
Our senior international correspondent Ivan Watson live at the Olympics in Pyeongchang.
Ivan, what are you hearing?
IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: That's right, sending his sister. It's a big deal. She is not only a family member, a direct sibling of the dictator, Kim Jong-un, but also happens to be a member of the Politburo and senior member in the -- in the ruling workers party in North Korea. And, in January of 2017, John, the Treasury Department slapped sanctions against her, singled her out and said that if there were any assets that they could find, that they would be frozen.
She will be joining what's already quite a large delegation of North Koreans who have already arrived by boat, over land. We're talking close to 500 North Koreans now, John, including an orchestra, including more than 200 cheerleaders, a taekwondo demonstration team, reporters and 22 athletes as well. The South Korean government has said that the -- sending the sister here means that the North Koreans are taking this quite seriously and they have promised to welcome her and the rest of the delegation appropriately.
BERMAN: Vice President Mike Pence on his way to the Olympic games, talking about North Korea overnight, Ivan.
WATSON: That's right. Alongside the Japanese prime minister, beating the drum, criticizing North Korea, singling it out, calling it a prison state. And this is the theme of his journey is, he wants to make clear that North Korea should continue to be isolated and that the world should not be taken in by its last minute agreement to cooperate with the Olympics.
[09:55:15] Take a listen to an excerpt of what he had to say. (BEGIN VIDEO CLIP)
MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES: To that end, I'm announcing today that the United States of America will soon unveil the toughest and most aggressive round of economic sanctions on North Korea ever. And we will continue to isolate North Korea until it abandons its nuclear and ballistic missile program once and for all.
(END VIDEO CLIP)
WATSON: Keep in mind, Pence has not ruled out the possibility of talking to the North Koreans. So we have to watch them very closely in and around the opening ceremony in just a few days' time here.
BERMAN: All right, Ivan Watson in Pyeongchang at the Olympics.
Ivan, thank you so much.
Here in the United States, something that we don't see very often, a possible big bipartisan deal that could have government working like it's supposed to. The president, though, not exactly helping.