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America's Shopping Frenzy Begins; Discovery of Laboratory Raises Questions in Falluja; Rockslide on Major Interstate

Aired November 26, 2004 - 07:00   ET


UNIDENTIFIED MALE: I can see a lot of buying over the next couple of weeks. Buy, buy, buy.


RICK SANCHEZ, CNN CORRESPONDENT: And here we go. America's retail feeding frenzy begins, with shoppers craving holiday bargains and stores hungry for shoppers.

What were insurgents doing with chemical agents in Falluja? The discovery of a laboratory raising some concerns over some deadly weapons.

The where of bounding boulders in Colorado. Take a look at that. It's a rock slide just down a major interstate.

And caught on videotape, the deliveryman who wound up on the receiving end.

All ahead on this AMERICAN MORNING.

ANNOUNCER: From the CNN broadcast center in New York, this is AMERICAN MORNING with Soledad O'Brien and Bill Hemmer.

SANCHEZ: And good morning.

It's Friday.

Bill and Soledad are off.

I'm Rick Sanchez.


Thank you for joining us this morning.

The big story, of course, already happening in malls and department stores across the country. We'll look at what shoppers can expect when they brave the crowds. We'll also talk to the head of one big -- one of the big retail chains about what they've got planned to lure you in.

SANCHEZ: Also, we're going to be following up on a story that we first told you about here on AMERICAN MORNING just yesterday. Talking about that chemical lab in Iraq where manuals and pamphlets on anthrax have been found.

COSTELLO: But we're also looking at the anthrax vaccine as it was used on American troops. We'll talk to an author who says the vaccine could be threatening the lives of those men and women in uniform.

SANCHEZ: And Jack Cafferty has some time off today, but Toure' is going to be here with some of the questions of the day, your comments and a whole lot more.

But before we do anything else, let's go ahead now and check in with some of the other stories that are making news on this day.

Tony Harris following things for us at the CNN Center in Atlanta -- hey, Tony.


Good morning, Rick.

Good morning, Carol.

Now in the news, at least two U.S. Marines have been killed in Iraq. Military sources say the troops were killed yesterday during house clearing operations in Falluja. And a car bomb went off near a military convoy north of Baghdad. Two U.S. soldiers and two Iraqis were injured.

The commander of U.S. forces in the Middle East extending his tour of Afghanistan for another day. General John Abizaid meeting today with Afghan President Hamid Karzai, one day after his surprise holiday visit with American troops. The U.S. still has about 18,000 troops in Afghanistan.

Ukraine's presidential election results are on hold until Monday. That's when the country's supreme court will decide what to do about possible voter fraud. Hundreds of thousands of demonstrators protesting the elections have been flooding the capital city of Kiev. The opposition leader is calling for a national strike. Mediators are hoping to nudge both sides into talks.

And we could learn by next week whether more doses of flu vaccine will become available here in the United States. According to "USA Today," the Food and Drug Administration is trying to determine whether at least five million flu shots can be imported from Europe and Canada to boost supplies here in the States. So far, health officials have been urging only those most at risk to get the flu shot because of the shortage.

7:03 now.

Let's send it back to New York and Rick Sanchez -- hey, Rick.

SANCHEZ: All right, Tony, we'll be talking to you again.

Now, it's black Friday, that's what they call it, the traditional kickoff of the holiday shopping season. Major retailers were open for business dark and early this morning. Stores across the country launching the season long before normal opening hours by unlocking their doors to scores of waiting shoppers all over the place.

In New York, for example, at Macy's Department Store, at Herald Square, it opened just a short time ago.

In fact, that's where we find our own CNN's Allan Chernoff -- Allan, why -- set the scene for us.

Why is this such an important day?

ALLAN CHERNOFF, CNN CORRESPONDENT: Well, obviously the retailers want to have a very important season. They want to do well in terms of selling plenty of goods. And they're a little bit concerned, because lots of people obviously are worried about the economic situation.

Nonetheless, we had plenty of people coming in here as soon as the doors opened at 6:00 in the morning Eastern time. As a matter of fact, I met some folks who woke up at 2:30 in the morning just to make sure they got here before the doors opened. Of course, they want to beat the crowds and also get some of those door buster specials -- down jackets for $50; microwaves for $50. This is important to a few people because of exactly what's happened to gasoline prices.


CHERNOFF (voice-over): The road to the holiday season checkout counter passes through here.

UNIDENTIFIED MALE: Could you fill it up, please?

CHERNOFF: Gasoline is 30 percent more expensive than last Thanksgiving. For families on tight budgets, that means less money to spend on holiday presents.

UNIDENTIFIED MALE: This is going to be a more difficult Christmas in every way.

CHERNOFF: A survey of consumers found nearly 30 percent predicting they'll cut holiday spending from last year. And shoppers expect to buy more two thirds of their gifts on sale.

UNIDENTIFIED FEMALE: I have to be more wise. I have to get more for my money, you know? As they say, I'm living on a budget.

CHERNOFF: So, some retailers, like Sears and J.C. Penney, have been offering early markdowns, even before Thanksgiving.

WENDY FARINA, KURT SALMON ASSOCIATES: We think that the retailers have actually conditioned their consumers to buy on sale, particularly this time of year. That's a problem for retailers.

CHERNOFF: But for upscale retailers and the shoppers, it should be a season of plenty. UNIDENTIFIED MALE: I'm very optimistic about how things are going and I'm going to buy, buy, buy.

CHERNOFF: Items likely to be high on the shopping lists -- handbags, iPods, TiVo and digital cameras. But for the first time ever, shoppers say gift cards will be their most frequent purchase. It may be a challenging season for discount retailers, but shopping at other outlets should more than compensate. That's why retailing experts predict holiday sales will rise 4 to 6 percent from last year.


CHERNOFF: While consumers plan to spend more money than they did last year, they're hoping to spend less time. Surveys indicate that shoppers are planning to visit fewer stores and spend more time shopping over the Internet -- Rick.

SANCHEZ: They're just going to be a little more picky this year. I guess it's worth it if you can get a down jacket for $40 or $50, right, Allan?

CHERNOFF: Well, as long as you're willing to wake up before the crack of dawn.

SANCHEZ: 2:30 in the morning for a down jacket.

Allan Chernoff bringing us the latest there.

We certainly appreciate it.

We'll be checking back with you -- Carol, over to you.

COSTELLO: I know, that's just wrong. It's too early for me. Too early.

As always, retailers hope black Friday will be a springboard to a successful holiday season.

Terry Lundgren, CEO of Federated Department Stores, is with us from Macy's in New York, where the doors opened hours ago.


TERRY LUNDGREN, CEO, FEDERATED DEPARTMENT STORES: It's amazing, but customers come out bright and early on the day after Thanksgiving ready to shop.

COSTELLO: Are they going to find like big time discounts?

LUNDGREN: Well, you know, every year we always try to incent people, particularly this day, with great values. And there will be plenty of merchandise on sale. But there will be plenty of gift items, as well, that just are valued every day at the right price. And so that's what the combination that we'll be offering here at Macy's.

COSTELLO: I seem to remember last year that some items were discounted 50 percent.

Will I see the same thing this year?

LUNDGREN: There will be some. But, you know, something is a little bit different this year, and that is business has been a lot better, as you know, this year for us and for others. And so there's much more of a supply and demand imbalance this year than there has been in the past. So while there will be sales and there will be discounts, I think it'll be a little bit harder to find all of your things if you just keep on waiting for it to go deeper and deeper on sale. I think there's going to be good value but less discounting overall, I think, this holiday season.

COSTELLO: Is that because that's really not good -- doesn't make good business sense because, you know, if you discount too much, like it kind of hurts you year round?

LUNDGREN: Well, I think what we want to make sure is that the end price is the right price for the consumer. And so if parkas are just simply not moving, you know, in our case, we're in the fashion -- a fashion business, not just a basic business. If it's not moving, we just mark it down. We get out of it and get into the next thing. And so in our business you're going to always find some great products that are available to you at discounted prices.

But, again, what's really important is the affordable luxury business. I mean those products like cashmere sweaters going out the door at $79 is a great value. We bought it with that intent, to sell them at that price, and they're selling very, very well.

So it's that combination of those things that didn't sell that are being discounted more heavily, as well as the things that are on sale, but at just really good value.

COSTELLO: That does sound like a good price for cashmere. But according to a recent Gallup poll, most people are expecting to spend as much as they did last year, or less, because they're so concerned about high energy costs.

Are you concerned about that?

LUNDGREN: Well, a company of our size -- and we're a little over $15.5 billion this year -- we are impacted by the general macroeconomics. And oil prices are an issue. But as you know -- you're closer to it than I am -- there has been some good news in the consumer confidence category coming out just today and recently. And so we're looking forward to a positive Christmas season, as we had last year.


COSTELLO: Optimism for you. We'll check back with Terry Lundgren to see if early numbers are matching his expectations. That's in our final hour at 9:00 Eastern.

SANCHEZ: All right, let's put the words to those pictures you saw just a little while ago as we were beginning this newscast.

It took some travelers in Colorado several extra hours to reach their Thanksgiving destinations because of that. It's a rock slide yesterday morning. It's about 100 feet long. It closed a 24-mile section of I-70 in the mountains near Glenwood Springs out there in Colorado. Drivers were sent on a 220-mile detour while workers cleared the boulders, some as large as vans.

COSTELLO: Oh, get out.

SANCHEZ: There were no injuries. Crews are working to open part of the highway today. That's a lot of rock to move.

Time for our first check of the forecast now.

Let's go over to Chad Myers at the CNN Center in Atlanta, Carol's friend -- Chad.


SANCHEZ: OK, thank you.

Let's be friends this morning, Chad.

How are you?

MYERS: I'm doing good. Those folks in Colorado are not, though. And the detour that they have to take now, all the way up through Beaker and Craig, and then over to Steam Boat and then back down either into Silver Thorn or back over to Walcott. It's a five hour detour, around a one hour drive. And it's snowing on the detour right now. And you saw, that was an elevated part of the roadway. There was only one lane there, well, two lanes, for a while. Then they made the I-70 the four lane there and had to lift one off.

So it's a bridge and those boulders went right through the bridge. It's going to be a while before they get that operating well.


COSTELLO: I know you saw this tape, Chad, but I'd like all of you take a look...


COSTELLO: Can you believe this? This is a store surveillance camera.

MYERS: But now...

COSTELLO: ... capturing the deliveryman who's just going about his business, as you just saw, until a car driven by an elderly woman plows right through the front door of the store and (UNINTELLIGIBLE) to take him down. Amazingly enough, he walked away with only a few bruises. The store owner said the driver was OK, too. So you can call that an early Christmas present for both. SANCHEZ: Wow! It hurts to look at it, doesn't it?

COSTELLO: I know. Wow!

SANCHEZ: Thank goodness he's OK.

Well, still to come, looking to avoid the holiday rush at the mall? Help may be just a point and a click away.

COSTELLO: And troops find a possible chemical weapons lab in Iraq. Was it used to manufacture death? We will take you live to Baghdad.

SANCHEZ: Also, on a day when two Marines are killed in Iraq, the story of a Marine injured in Falluja, recovering and hoping to return to duty.

That's all ahead on this AMERICAN MORNING.


COSTELLO: U.S. and Iraqi officials say troops have found a laboratory in Falluja with what appear to be chemical materials. Iraq's national security adviser announced yesterday that the lab had manuals and ingredients for producing explosives and chemical blood agents.

CNN's Karl Penhaul live in Baghdad.

He has more for us this morning -- hello, Karl.


It was Iraqi soldiers, in fact, who made that discovery in the southeastern corner of Falluja. As you say, an installation being described as a laboratory. And inside a range of chemicals there. Now, U.S. military sources have told us that they don't actually believe that any chemical warfare agents had been made there, but more that at this stage explosives have been made there for certain, and also that some research was going on into producing what the Pentagon has termed chemical blood agents.

In practice what these are are these readily available industrial chemicals that once mixed together can produce something more toxic, more corrosive, more poisonous. So a relatively cheap and easy to manufacture terrorist tool, if you like. But certainly no evidence that any of the chemical warfare agents like anthrax were manufactured there. But we do understand that there were some pamphlets describing how it could be done -- Carol.

COSTELLO: So, Karl, where exactly do they think the chemicals came from?

PENHAUL: Some of these chemicals are very easily available industrially. They're mass produced chemicals -- hydrochloric acid, chlorine, for example. And in and around Falluja, there have been factories around there. So these might have been chemicals normally used in other industrial processes and then taken there, and, as I say, transformed into something a little more poisonous, a little more corrosive, and used for bad means rather than for the industrial means they were originally intended for.

COSTELLO: Karl Penhaul live in Baghdad this morning.

Thank you.

SANCHEZ: Let's talk more about this. I want to introduce you to somebody who's an expert on this.

His name is Terence Taylor.

He's with the International Institute for Strategic Studies.

What are you hearing about this lab, Mr. Taylor?

TERENCE TAYLOR, INTERNATIONAL INSTITUTE FOR STRATEGIC STUDIES: Well, I think it's very hard to make an analysis from what we've heard so far. There are some elements there that could be used for perhaps manufacturing some limited scale chemical weapons and some information about how to make some biological agents. But put all together, it's very hard to see this is a very serious matter.

SANCHEZ: Doesn't it seem odd to you? Why in the world would they put a chemical lab in the middle of what is, for all intents and purposes, a war zone?

TAYLOR: Well, this was, if you have to remember, a stronghold, a sort of safe area for them, for the insurgents, that is.


TAYLOR: And it's been there for some time. So they may have got hold of some materials looted from various places and there are elements there -- they might be industrial chemicals, for example -- that could be put together to make a chemical called hydrogen cyanide, which is a lethal chemical agent. But it does not seem to me as though they could make very large quantities from the materials there.

SANCHEZ: So let's go ahead and break down some of the materials that they have found in there so far.

Let's take them one at a time.

First of all, hydrochloric acid.

What could that be used for?

TAYLOR: Well, that is a component of making hydrogen cyanide, which is a highly toxic gas, if it's in gaseous form. But it vaporizes very rapidly and disperses very rapidly. But if somebody inhaled a substantial amount of it, it would kill them. And there's no antidote. SANCHEZ: But as you know, what's more importantly, usually, in cases like this, is how do you use it? What's the delivery system? It's one thing to make it, it's another thing to actually be able to use it against somebody.

How would they use it, for example, against our soldiers?

TAYLOR: Well, this is the very point. It's one thing to make the chemical. It's very hard to deliver this particular type of chemical, hydrogen cyanide, in a way that would kill a larger number of people in a kind of concentration.

SANCHEZ: The same for...

TAYLOR: There's no evidence of material to deliver these things.

SANCHEZ: The same for sodium cyanide?

TAYLOR: Well, the same. These are the things that go together, the hydrochloric acid and the sodium cyanide. You put them together. They're precursors for making hydrogen cyanide.

SANCHEZ: Now, on the issue of anthrax, they didn't find anthrax and we should make that clear. What they did find is information on how to make anthrax, pamphlets, we understand.

Should we be alarmed by that?

TAYLOR: Well, I think it's a cause for concern. We never really understood the full scope of the biological weapons program. I myself was one of the inspectors that was looking into this during the 1990s. So we don't know everything that was done. It doesn't surprise me that some elements have been found, like, for example, pamphlets. But as I understand it, there's no live organisms found, no system for making anthrax, fermenters and all these kinds of things. So we need to learn a bit more yet.

SANCHEZ: And as we've learned about anthrax, there's a far and long distance between knowing how to do it and actually being able to crystallize it and use it in a form that can actually affect people so you can disperse it, correct?

TAYLOR: Yes, disperse it in a way that will kill very large numbers of people. A small quantity, of course, could be alarming for a small number of people used in a very specific location.

But from all of this, it's very hard to divine that this is a kind of weapons laboratory at the moment.

SANCHEZ: Good to know.

Terence Taylor with the Institute for Strategic Studies, thank you for sharing your information with us.

TAYLOR: My pleasure.

SANCHEZ: Carol -- over to you.

COSTELLO: All right, thanks, Rick.

Still to come, got an airport security nightmare to share? We want to hear about it. That's next on AMERICAN MORNING.

You stay right there.


COSTELLO: I know a lot of you are out there shopping already, and you're crazy. But if you don't want to say...


COSTELLO: It's crazy to get up...

SANCHEZ: Or something else.

COSTELLO: Or something else.

But if you want to beat the masses at the mall, Gerri Willis is in for Andy and she is minding your business. She has some tips about online shopping, which sounds more comfortable to me.

GERRI WILLIS, CNN CORRESPONDENT: Yes. You don't even have to get out, get in the car in the middle of the morning and go shopping. Forget that. Get online. The thing to do here is already shop with the retailers you already know. That's the key to this. You want to be safe when you're shopping online, so make sure you're dealing with retailers who have a privacy policy online.

Here's the red flag, Carol. If somebody has a P.O. box for a return address on their Web site, you don't want to go there. Don't go there.

COSTELLO: That's probably good advice.

You know, though, I am a little freaked out when I shop online because I always think someone's going to steal my identity.

How can you make sure the Web site is really secure?

WILLIS: Well, you want to make sure you're looking for encryption technology. It's easy enough to do. When you're looking at the URL, the Web address on the Web site, it should read https. That means it's secure. The Sis for security.


WILLIS: If it doesn't have that, you could be in trouble.

COSTELLO: Got you.

Well, tell us about that thing you just told me in the commercial break, about you can get a one time credit card number. That's pretty cool.

WILLIS: Yes. A lot of the big card issuers, what they're doing now is they're offering people one time credit card numbers that you use when you shop online. You use it that one time, then it disappears and you're that much more secure. I think it gives people like that extra level of comfort if they're not used to shopping online.

SANCHEZ: Got you.

OK, you mentioned the post office box. But what other signs are there that are out there that someone is imitating being a real live shopping entity?

WILLIS: Well, the big thing you want to watch out for this year, the big scam out there is phishing. That's with a P-H. That means you're getting an e-mail from somebody who claims to be the retailer that you were using. They're asking you for personal information, maybe your credit card number. We didn't get that credit card number, can you send it again? That is a sign that you're dealing with somebody who's actually a scam artist.

You contact them if they're having problems with your order. But beyond that, you don't want to send any information to somebody you don't know who they are.

COSTELLO: Good advice.

Thank you, Gerri.

WILLIS: You're welcome.

SANCHEZ: Well, Toure' is here for Jack.

He stopped at Macy's this morning and got those baby blue pants. Isn't that nice?


SANCHEZ: What do you got?

TOURE': Well, you know, this week lots of people are complaining about the TSA's airport pat down procedure, which is way more invasive than it used to be. The last time I flew, the screener got all up close and personal with me. Now, I'm not a modest person, but he patted me down, you know, on my chest in a way that reminded me of a girl who doesn't know what she's doing. I felt all violated and wanted to press charges or give him lessons or something.

But this is modern America. You've got to get naked to get on a plane nowadays. Airport screeners are becoming more sexually aggressive -- excuse me.

COSTELLO: What? TOURE': More protective of us. But does it make you feel any safer? Well, if you're like me, the answer is no. But as they say, you can't fight city hall. So let's kvetch together. Tell us your true horror stories. The Question of the Day -- what is your worst airport security nightmare?

SANCHEZ: People are really upset about this?

TOURE': Oh, yes.


COSTELLO: Oh, I've got one that's just frightful.

TOURE': Good.

SANCHEZ: Can't wait to hear it. But you're going to have to save it, though, because we're like plum out of time, so say the producers.

COSTELLO: And you're absolutely right.

So let's get to the tease.

Still to come, it's the Friday edition of "90 Second Pop."


GLORIA GAYNOR: Oh no not I. I will survive. For as long as I know how to love, I know I'll be alive.


COSTELLO: One of the sassy desperate housewives will be getting bumped off. Who won't survive?

And it ain't easy being an ex-"American Idol." How former contestants are keeping their careers alive and who's having the most success.

Stay with us on AMERICAN MORNING.


GLORIA GAYNOR: Oh, now go, walk out the door, just turn around now, you're not welcome anymore.




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