NEWSROOM for June 28, 2001
Aired June 28, 2001 - 04:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANNOUNCER: Seen in classrooms the world over, this is CNN NEWSROOM.
SHELLEY WALCOTT, CO-HOST: Welcome to CNN NEWSROOM for Thursday. I'm Shelley Walcott.
TOM HAYNES, CO-HOST: And I'm Tom Haynes.
Here's a quick look at the rundown.
WALCOTT: Leading the news lineup, the Fed makes a move on interest rates. Find out what it did and how it affected the stock markets.
HAYNES: Then, we will go inside some caves but not for exploration. Restoration is on the agenda in today's "Science Desk."
WALCOTT: Up next, there's a people count going on in "Worldview."
HAYNES: Finally, we "Chronicle" the return of baseball to Brooklyn.
WALCOTT: The Federal Reserve cuts United States interest rates for the sixth time this year. The Federal Funds Rate, that's the Fed's target for the rate banks charge each other, now stands at 3.75 percent. That's a quarter percentage point less than what it had been and the lowest it's been in seven years. The Central Bank was set up by the U.S. Congress in 1913. Its main duties include stabilizing and supervising the nation's financial system, providing financial services and protecting consumer's credit rates.
Tim O'Brien has more now on the Fed's decision to cut interest rates.
TIM O'BRIEN, CNN CORRESPONDENT (voice-over): Wall Street was divided over whether Alan Greenspan and the Fed should cut interest rates by a quarter or a half a percentage point, and divided over whether the quarter-point they settled on was enough.
Members clearly were not blind to the economy's lingering problems. In a statement, they acknowledged "declining profitability and business capital spending, weak expansion of consumption, and slowing growth abroad continue to weigh on the economy."
Problems Merrill Lynch felt would have justified yet another half-point cut.
BRUCE STEINBERG, MERRILL LYNCH: I'm kind of disappointed. I had hoped that they would do more. There was nothing in their statement which explained why they did the lesser move. In fact, their statement painted a fairly uniformly negative view of the U.S. economy right now.
O'BRIEN: Today's cut is the sixth rate cut in six months, bringing the target rate down from 6.5 percent last January to 3.75 today. That's the most aggressive credit-easing campaign in nearly 20 years, and some economists warned had the Fed gone any further, it could have fueled inflation.
In its statement, the Fed said: "Easing of pressures on labor and product markets are expected to keep inflation contained."
MIKE RYAN, PAINEWEBBER: It's sort of like Dad took off one of the training wheels and is making sure that the bike is still balanced. And here we are, we're going to try and keep the bike on a clear path.
O'BRIEN: And if the economy continues to deteriorate?
DIANE SWONK, BANK ONE: I still think another move inter-meeting is very possible. This is a Fed that's going to be monitoring events very closely.
O'BRIEN (on camera): The lag time is at least six months to a year before rate cuts are actually felt. There has been a smattering of encouraging economic news in recent days, which could mean previous rate cuts are finally beginning to take effect. Defenders of this latest quarter point cut say the Fed is entirely justified in determining if it's off in the right direction before picking up any additional speed.
Tim O'Brien, CNN Financial News, Washington.
WALCOTT: The Federal Reserve made its decision to lower interest rates in an effort to keep the economy from slipping into a recession. Many businesses are applauding the Fed's decision, but some traders on Wall Street were hoping for a more aggressive half percentage point cut. Stocks fell slightly, Wednesday, after the Fed lowered interest rates. Now, in the past, the Central Bank's easing of monetary policy has boosted the markets.
Allan Chernoff reports.
ALLAN CHERNOFF, CNN CORRESPONDENT (voice-over): It takes time for Federal Reserve interest rate cuts to work through the economy and the stock market.
ALAN SKRAINKA, EDWARD JONES: I think investors have to be patient. The medicine will work with .
CHERNOFF: But from Wall Street's perspective, it appears Fed Chairman Greenspan has been shooting blanks. Since the Fed first began cutting interest rates on January 3, the Dow is down 2 percent, the Nasdaq off 9 percent.
ALAN BLINDER, FORMER FEDERAL RESERVE VICE CHAIRMAN: Every time the Fed is in an easing cycle or a tightening cycle, people get impatient, because it takes a long time for this medicine to work. And they say, oh, it's not working this time. Somehow, it always does. I wouldn't bet against it this time either.
CHERNOFF: Before today's move, the Federal Reserve had cut interest rates six times in a row only three times in the postwar era. Three months after the sixth cut, the Dow was up 6 percent, the Nasdaq up 8 percent. After 12 months, the Dow was up 24 percent, the Nasdaq up 29 percent.
TOM GALVIN, CREDIT SUISSE FIRST BOSTON: The history shows that it takes six to nine months for rate cuts to start to have an impact, and therefore we should start to see that over the next couple of quarters.
CHERNOFF: The data show a similar response after three consecutive rate cuts. On average, the Dow has been up 7.5 percent three months after the third interest rate cut, 21 percent after 12 months; the Nasdaq up 12 percent after three months and 40 percent after 12 months.
(on camera): Strategists who have been telling clients to buy into the market are hoping that history repeats itself. But, of course, investors buy stocks based on what they believe will happen in the future, not on historical precedent.
Allan Chernoff, CNN Financial News, New York.
KELVIN WILSON, DALLAS, TEXAS: My name is Kelvin Wilson. I'm from Dallas, Texas. And my question is: Other than Alan Greenspan being on the Federal Reserve Board, who else is on the board and how many? How are they chosen, elected or appointed to the Federal Reserve Board?
EDWARD GRAMLICH, BOARD OF GOVERNORS, FEDERAL RESERVE BOARD: Most people hear a lot about Greenspan and don't know much about the other governors. There - by law there are seven governors, one of which is the chairman, Greenspan. Right now we have two vacancies so there are only five of us and the four others are me, Roger Ferguson is our vice chair and the other two governors are Larry Meyer and Mike Kelley. We are all appointed by the president and confirmed by the Senate. We serve, each of us, a 14-year term, but if part of a term has already been served, you get to serve the rest of that term. So most of us end up actually serving a lot less than 14 years. The terms end at the end of an even numbered year in January.
HAYNES: If you are a caver, our next story is for you. What is a caver you ask? Well, a caver is someone who likes exploring caves, especially as a sport or a hobby. In today's "Science Desk," we're delving into speleology. Now, speleology is the exploration and study of caves.
Miles O'Brien has the story of what a group of volunteers is doing to restore the granddaddy of all caves.
NORM ROGERS, ECHO RIVER CAVE RESTORATION: Our major purpose today is to go to Echo River and disassemble more of the bridge. It's really, really tough stuff. When you get down there, you're going to realize how hard it's going to be. The word of the day is work slow and work safe.
MILES O'BRIEN, CNN CORRESPONDENT (voice-over): Norm Rogers is the volunteer manager for the Echo River restoration project in Mammoth Caves. For the last 13 years, he has organized volunteers from around the country, mostly cavers from the National Speleological Society, to help restore the cave back to its national ecological state. The main goal on this project is the dismantling of a 70-year- old abandoned tourist walkway constructed of creosote soaked timber and spiked with rusty nails. The combination of creosote, tourism and lights have endangered many species in the underground Echo River.
ROGERS: Mammoth Cave is the granddaddy of them all, the longest cave in the world. And when I put out an e-mail to people and say hey, come on down and visit us, come on down and volunteer your time in the longest cave of the world, that gets cavers excited.
UNIDENTIFIED CAVER: Wood with nails.
O'BRIEN: Working a mile into the cave, volunteers have the task of removing lighting fixtures and cabling, tearing down metal fencing and hand rails and removing the wooden wreckage from old Park Service boats. With no electricity, these volunteers work with only a head lamp and hand tools. The National Park Service relies on the volunteers to get big projects like this done because staff and funding are not available.
JOHN FRY, NATIONAL PARK SERVICE: You need large numbers of people to pull something like this off and a volunteer effort in an organization like the NSS is probably about the only way you could get it done.
CHRIS DINESEN ROGERS, VOLUNTEER: It's extremely harsh and hard work in the cave and cold and long hours and, you know, you've got two miles to haul rotten creosote and wood to the entrance and it's quite a daunting task. So you just, you couldn't hire somebody to do that, I really don't think. It'd cost you too much money.
O'BRIEN: The work is dangerous. First, heavy beams of wood are slowly disassembled by workers in the water and then they're carried away by volunteers to the cutting area. Next, huge pieces of wood are cut down into smaller pieces to be bagged and carried to a staging area inside the cave.
On this day, the work party dismantled 54 feet of wood and carried out more than two tons of material. Norm Rogers has calculated that over the last decade his volunteers have donated more than one quarter million dollars worth of labor to the project.
ROGERS: This is the legacy of cavers. It's a legacy of volunteers, a legacy of people who care enough about the environment, about the world around them to come down here and do something about it.
Miles O'Brien, CNN.
HAYNES: In "Science Desk Extra" today, scientists say they've done all they can to help an injured whale off Massachusetts. The endangered northern right whale, one of about 320 in existence, has a fishing line entangled in its mouth. Now there's a chance it'll be able to remove the line on its own, but officials say the whale has developed a mouth infection that's becoming worse.
Natalie Pawelski has more on the endangered whale and the species struggle to survive.
NATALIE PAWELSKI, CNN CORRESPONDENT (voice-over): Right whales are the most endangered of the great whales, among the most endangered of any big mammal anywhere on the face of the Earth.
CHRIS SLAY, NEW ENGLAND AQUARIUM: This is our white rhino, this is our giant panda.
PAWELSKI: Best estimates put the Northern right whale population between 320 and 340 whales. Researchers say every animal is precious, maybe not essential to the species' survival, but close to it. The whale entangled off Massachusetts is a male of breeding age, probably a father, certainly a potential contributor to the future of the species. A 50 ton giant done in by a fishing line, an echo of the right whales' history.
(on camera): Right whales got their names from whalers, who considered them the right whale to hunt. They were full of blubber, slow moving, and stayed close to shore. All of that is still true today. And they are still in harm's way. (voice-over): Living close to shore, and so, close to humans they are the urbanites of the whale world. In the winter, mothers nurse their one-ton newborns near the busy ports and military bases of Florida and Georgia. their annual migration takes them across the shipping lanes and fishing grounds of the Northeastern U.S.
Right whales have only one real predator, unintentional, but deadly all the same: people. The number one cause of death for these animals, including at least two newborns so far this year: being hit by ships.
SLAY: We're the wealthiest, most powerful nation in the world and here we have one of the most endangered populations of large mammals in the world right out our back door, and I think that it would be a shame if, 100 years from now, this population became extinct because we didn't give it our all.
PAWELSKI: There are other whales in the sea, dozens of other species with a better chance of survival. But it was the hand of man that almost wiped out right whales in the first place. Now it is human hands trying to help ensure the species' survival.
Natalie Pawelski, CNN.
WALCOTT: Time to do some number crunching in "Worldview" today, and we'll also find out how some fury creatures are bearing up in Asia. We journey to Japan to look at the risks facing bears and how some people are trying to help. And we travel to the United States to check out changes in the makeup of the American family.
HAYNES: Every 10 years, the United States conducts a national census. A census is a periodic governmental survey used to collect information about the nation's population. Well, this year's census figures came as a shock to many demographers or people who study population trends. They found that the traditional family of a mother, father and children makes up less than a quarter of the population.
As Kitty Pilgrim reports, these findings have huge implications for consumption patterns and the future of the economy.
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): It's just not the same. The "Leave It To Beaver" culture of the 1950s no longer exists, 26 percent of all households are now one person living alone. The number of single parent families grew five times faster than traditional families in the last decade. The number of unmarried couples in the United States nearly doubled in the last 10 years. And people are marrying later, and delaying having children. Some demographers were shocked at the social implications of the latest data.
KENNETH OCONNOR, FAMILY RESEARCH COUNCIL: Children are much more likely to live below the poverty level when they are in families that merely cohabit together. And as a family unit itself, married couples are much more likely to make more money than cohabiting couples.
PILGRIM: Yet others point out economic pluses. They say today's society is less rigid. That keeps the labor force more nimble.
DELOS SMITH, THE CONFERENCE BOARD: Much more mobile. Again, the ease of moving, I think this is one of the great strengths of the United States is that flexibility. There is no country in the world that moves as much as this country does.
PILGRIM: Other pluses hidden in the data: Some of those single people are seniors. With gains in medicine, older people are living independently, longer. As people form and reform nontraditional groups from decade to decade, it boosts consumption. In addition, single parents in the work force change working norms, allowing for nontraditional working hours and new ways to do business.
WALCOTT: More on the U.S. census now and the changing face of American families. According to the latest figures, families headed by single moms make up nearly 12 percent of the U.S. population and more than 16 percent of total family households. These moms often juggle family life, a career and higher education - a job that's difficult but increasingly more common.
Bill Delaney takes a closer look at the challenge.
BILL DELANEY, CNN CORRESPONDENT (voice-over): When Jodi Delibertis and her 5-year-old daughter Caitlin (ph) reunite late each afternoon, they're part of a way of life 79 percent more common than 15 years ago: single mothers with college degrees who work.
JODI DELIBERTIS, WORKING MOTHER: I think the biggest challenge is the schedule. You've always got some responsibility that's waiting, so there's not a lot of downtime.
DELANEY: There is a lot of company. An administrator with a nice, regular schedule at Boston's Simmons College, Delibertis is one of 938,000 women with bachelor's degrees raising children alone.
DELIBERTIS: I had thought of going to law school, and I don't think I would do that now. The hours that lawyers work, I just don't see them working as a single parent.
DELANEY: Single mother households increased at a rate five times greater in the 1990s than traditional two-parent families. In much of the business world, though, availability, long hours, and face time still count, big time.
DEBORAH MERRILL-SANDERS, SIMMONS COLLEGE: You keep coming up against at that norm. That's particularly difficult, obviously, for single parents, who have to have a hard stop at the end of the day, and a hard beginning at the early part of the day.
DELANEY: Though maybe the sheer rate of increase of highly educated single mothers may yet change the workplace.
(on camera): Another dynamic at play here is that while the number of single mothers with college degrees, like Jodi Delibertis, has gone up dramatically, the number of single mothers who only completed high school has gone up much less.
(voice-over): Just 6 percent in 15 years, compared to that 79 percent upswing of working women, like Jodi Delibertis -- whose next- door neighbor is another college-educated single mom.
UNIDENTIFIED FEMALE: I think that every single parent should hook up with another single parent, make two families, and help each other.
DELANEY: Changing faces of who is in the workplace. The question is how much the workplace can change, too.
Bill Delaney, CNN, Boston.
RUDI BAKHTIAR, CO-HOST: Now to the island country of Japan located in the north Pacific Ocean. Japan is one of the world's economic giants with its total economic output exceeded only by the United States. The Japanese manufacture a variety of products, including cars, computers, steel, textiles and television sets. Even though Japan has few natural resources, it has managed to become a major economic power by importing many of the raw materials needed for industry and exporting finished manufactured goods.
Even from its early days, Japan has been greatly influenced by the neighboring Chinese civilization. Between the late 400s and the early 800s, the Japanese borrowed heavily from Chinese art, language, religion and government. And today, Chinese medicine is posing a big threat to Japan's bears.
Gary Strieker explains.
GARY STRIEKER, CNN CORRESPONDENT (voice-over): In the dark of night, a bear raids a garbage dump in a Japanese mountain resort. A habit like this could get this bear shot. It could also be killed for another reason, to supply pharmacies that specialize in traditional Chinese medicine; a market with a strong demand for bear gall bladders and medicines made from bear bile.
Pharmacist Utaka Takahashi (ph) says bear bile is very effective medicine for chronic stomach disease and for gallstones. He says he's now marketing tradition medicine like bear bile on the Internet, and more younger people are starting to use it; an ominous threat to Japanese bears. In the entire East Asia market for traditional Chinese medicine, Japan is now the only nation with a sizable population of wild bears; about 10,000 of them. There are brown bears on the northern island, Hokkaido, but most are smaller Asian black bears on the main southern islands. This one now has radio collar to allow scientists to track him.
In Karuizawa, northwest of Tokyo, researchers in this project have captured and collared seven black bears. Musawu Koyama (ph) keeps track of them to learn how far they range in these rugged mountains and how they survive.
He says, "We know very little about the status of the bear population here."
But he believes they face extinction because there's almost no regulation on bear hunting.
Officially, about 1,400 bears are killed every year in Japan for sport hunting and pest control. But conservationists believe the actual number is much higher. Meanwhile, pharmacists say their stocks of imported bear bile medicine are almost exhausted. International trade restrictions and conservation laws have shut down imports from sources like Chinese bear bile farms, widely condemned as inhumane.
(on camera): Wildlife experts say without more controls on hunting, Japan's populations of wild bears could soon be endangered, especially if they're targeted as a source of gall bladders to meet local demand for traditional Chinese medicine.
(voice-over): But those who are concerned about these bears say the importance of their cause is still unrecognized by government authorities and widely ignored by the Japanese public.
Gary Strieker, CNN, Karuizawa, Japan.
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HAYNES: They are heading out to the ballpark in Brooklyn for the first time in more than 40 years. The New York City borough is home to a new baseball team. It's a Minor League team called the Brooklyn Cyclones named after a famous roller coaster at Coney Island. Brooklyn has been without a baseball team since its beloved Dodgers packed up and headed to L.A.
Bruce Morton has more.
BRUCE MORTON, CNN CORRESPONDENT (voice-over): Matthew Peterson, 19, throws the first pitch of the Brooklyn Cyclones' first home game to Maximo Made, 19, of the Mahoning Valley Scrappers at KeySpan Park in Coney Island -- a ball.
Baseball, in a way, is back in Brooklyn. But is it? The old Dodgers, who left 44 years ago, are legends, were heroes, won pennants, a World Series. Roger Kahn covered that team and wrote a book about them: "The Boys of Summer." This isn't that, he notes.
ROGER KAHN, AUTHOR, "THE BOYS OF SUMMER": I'm mostly offended by trying to sell it as, "Baseball is back in Brooklyn," as though there was any connection between Hall of Fame players and the single-A players they're going to have. Five percent players on that level ever get to sit on a Major League bench.
MORTON: Yes, defenders say, but...
JEFFREY WILSON, COO, BROOKLYN CYCLONES: We're not the Brooklyn Dodgers. They were a championship Major League team. We're the Brooklyn Cyclones, a Class A affiliate of the New York Mets. But just the fact that the community has taken on to this team so fast and so nicely, it's very fulfilling.
UNIDENTIFIED FEMALE: Thank you.
MORTON: In fact, they have sold most of the tickets they have for this season. And opening night was -- well, opening night: kids, caps, autographs, not very many empty seats either. One of the hopes is that the team will bring people back to Coney Island. The old amusement park isn't the draw it used to be.
RUDY GIULIANI, MAYOR OF NEW YORK: How do you know that it's good for economic development? Well, if you look at all of the people who were standing here who were buying things, you get a sense. I mean, you just need a little common sense to do economic development. This is the way we've turned around 42nd Street. it's the way we've turned around 125th Street. It's the way we're going to turn around Coney Island.
Opening Day had a parade. The mayor and his girlfriend, Judy Nathan, marched. Republican mayoral candidate Michael Bloomberg was in the stands.
MORTON: And the ballplayers themselves, just starting out, just want to play, not study Brooklyn history.
MIKE JACOBS, CATCHER: For most us, it's just to be able to play, see what happens, see if we have the chance to make it to the big leagues. ROBERT MCINTYRE, SHORTSTOP: It's nice to be in Brooklyn, you know, but just playing ball anywhere, no matter where it's at. And it's really what we wanted to do. And so it really doesn't matter where we're at.
MORTON: Mayor Rudy Giuliani, a Yankee fan, threw out the first ball. And the Cyclones, in white now instead of practice blue shirts, played. And Joe Pignatano, a catcher on the team that left 44 years ago, was there.
JOE PIGNATANO, FMR. BROOKLYN DODGERS PLAYER: Baseball is baseball. You can't change that.
MORTON: They won't be the heroes, the legends of summer. They'll be the new guys, the young guys, the boys from Class A. They won their opener 3-2.
Bruce Morton, CNN, Brooklyn.
HAYNES: And a little more sports news now we've got for you. Yesterday's NBA draft, drumroll please,...
HAYNES: ... the first two picks were, believe it or not, high- schoolers.
WALCOTT: And the very first was Kwame Brown whose story we brought you yesterday. Congratulations, Kwame. He's going to be playing for Michael Jordan's Washington Wizards.
HAYNES: Good for him.
And that about does it for us for NEWSROOM for Thursday.
WALCOTT: More tomorrow.
HAYNES: Yes. See you later.
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