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Stock Market Rebounds from Big Losses; Reports of Iraq Explosion Clarified; Judge to Turn Over DNA Samples to Anna Nicole's Ex-Boyfriend; Many People Already Infected with STD, Study Says

Aired February 28, 2007 - 13:00   ET

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

KYRA PHILLIPS, CO-HOST: Hello, everyone, I'm Kyra Phillips, live at the CNN world headquarters in Atlanta.
DON LEMON, CO-HOST: And I'm Don Lemon.

All eyes on the markets. Will the rebound stick? CNN's Susan Lisovicz joins us with all the ups and downs.

PHILLIPS: What to do with your money. From 401(k)s, individual stocks. What's safe and what should you sell? Money guru Suze Orman answers your e-mails.

LEMON: And the cervical cancer vaccine. How young is too young to get it? How do you or your daughter know you don't have the cancer causing virus right now?

You're live in the CNN NEWSROOM.

PHILLIPS: A big spotlight on the big board. This may be the most watched set of numbers in the country right now. All eyes are on Wall Street a day after a global stock sell-off. As you can see right now, Dow Industrial, plus 88 points.

CNN's Susan Lisovicz following all the action at the New York Stock Exchange. I had to take a -- a double-take. I had to make sure it said "plus."

SUSAN LISOVICZ, CNN CORRESPONDENT: I know. We rode a wild ride yesterday. I could not believe my eyes in the final hours of trading. It actually was scary. I have to say. I can say it now that it's all over.

And well, that's really the question, Kyra. Is it all over? I think that a lot of investors are feeling a lot better that they see that the market is rallying.

We do have a nice rally. The blue chips were up 137 points at their high of the session. The breadth is very positive. That means for every -- there's two stocks rallying here at the New York Stock Exchange for every one that's rallying. It was a completely different picture yesterday when it was one to seven. We have big volumes. There's a lot of demand. And folks are feeling better.

You know, Ben Bernanke just happened to be speaking today -- it was long scheduled -- on Capitol Hill. His prepared remarks had nothing to do with the sell-off. But of course he was asked about it. And he said that he felt the financial markets were working well, that his fundamental overview of the U.S. economy is unchanged.

And I think that was -- that was well timed, well timed remarks. And we've got a nice rally going on right now, Kyra.

PHILLIPS: So -- and let's talk about the fact that the market is rallying. Put it into perspective. I mean, we can see the Dow tank later on this afternoon, right?

LISOVICZ: Yes, that's entirely possible. But it looks like, you know -- I mean, it looks like the breadth is pretty strong right now, as I mentioned, it's 2-1. And I think that is important.

Of course, you had a really violent sell-off yesterday where we had big point loss -- you know, big volume, terribly negative breadth. It was just a wave of selling. And it got worse as the day wore on.

And sometimes what you do is you get it out of your system. OK, you bring it back to more sustainable levels. And -- and a lot of folks say that, as painful as it can be and appears and -- it was really tough yesterday. I mean, technical glitches did not help matters. They exacerbated things. That, you know it paves the way for something like this, which is a relief rally.

And you know, we're well into the session now. And it appears that -- you know, that we're on solid ground right now.

PHILLIPS: Good. We'll keep talking. Thanks, Susan.

You've got questions. She's got the answers. Personal finance expert Suze Orman steps into the NEWSROOM in the 3 p.m. Eastern hour to talk about the stock market. Are you concerned about your 401(k)? Are you worried about your portfolio? You can e-mail your questions now to CNNNewsroom@CNN.com.

A grisly scene, a sadly familiar scene in Baghdad, where a car bomb went off today in a crowded outdoor market. At least ten people are dead. Twice that number hurt. It happened in a mixed Sunni/Shiite neighborhood.

We also learned today of the death of another American service member. A spokesman says a U.S. soldier was killed yesterday by small arms fire on patrol in western Baghdad. That, along with three other U.S. deaths reported yesterday, brings the U.S. military death toll if Iraq to 3,162.

Similar scene, different city and different circumstances. This is Ramadi, two days ago. A car bomb went off today (sic) to -- at a kid's soccer field. Iraqis say a dozen boys and six women were killed. In the aftermath, conflicting accounts that only now are getting sorted out.

CNN's Jennifer Eccleston is in Baghdad where U.S. officers worked to straighten out the confusion today -- Jennifer. JENNIFER ECCLESTON, CNN CORRESPONDENT: Yes, Don, we're beginning to get a clearer picture of just what happened in Ramadi. And that's because two senior officials, one in the health ministry and one in the defense ministry, told CNN that yesterday's alleged car bombing in Ramadi that reportedly killed 18 children, most of those children, is, indeed, false.

Now they, as well as a senior official in Ramadi, say the incident was confused with a bombing, as you mentioned, that happened there on Monday, where, indeed, women and children did die.

Now that reversal is consistent with American reports that no car bombs took place in the rest of the capital of Anbar province on Tuesday.

(BEGIN VIDEO CLIP)

REAR ADM. MARK FOX, MULTINATIONAL FORCE, IRAQ: The allegation was false. And so obviously somebody was stirring -- I can't -- I can only speculate as to what was going on there, but there was only one explosion. There were no children killed. And it was a controlled explosion.

(END VIDEO CLIP)

ECCLESTON: That controlled explosion was a detonation. And it just happened to be bigger than it expected. And as a result, 30 people were wounded, including children.

In another twist, the ministry of interior is standing firm on their account. They maintain that there was, indeed, a car bomb on Tuesday. And that goes with the condemnation of the alleged attack by Iraq's president, Jalal Talabani, who is in Amman seeking medical care, and also by Prime Minister Nuri al-Maliki, who called it a terror strike against Iraq's children. Those statements have not been retracted so far -- Don.

LEMON: And Jennifer, the question is why is it so hard to sort out what's happening in places like Ramadi?

ECCLESTON: Well, I think it's twofold. We have a situation where it's very, very difficult for journalists to news gather there. It is such a dangerous environment there.

Many pieces of the equation that make that city so restive and so violent. One is the -- it is a tribal area. And it also is an area that is occupied by insurgents, many of them allied with al Qaeda. Those two groups are fighting amongst themselves.

We also have the U.S. military influence there who are also trying to stem the tide of the insurgents in that city.

As a result of that violence, there has been a near infrastructure collapse in that city. There are no telephones. There is no cell system in Ramadi, like there is in much part -- in many parts of this country. And the only thing they operate by are satellite phones, which are few and far between and quite expensive.

So not only are we able to get journalists on the ground to actually report for us because it is so difficult and so dangerous. It is also a great challenge for Iraqi officials on the ground, namely, the Iraqi police, to actually get word back here to Baghdad.

So it is -- there is a very good reason why it is one -- a thorn in the side of Iraqi officials and also American officials.

LEMON: Jennifer Eccleston in Baghdad, thank you so much.

PHILLIPS: Passing notes, not judgment, not yet anyway. The "Scooter" Libby's jury has been deliberating a week on the perjury and obstruction of justice charges facing Vice President Cheney's former chief of staff.

Last night, jurors set up a note, asking the judge to clarify one of the allegations. And today, the judge sent a note back, asking jurors to clarify their question.

The jury replied with another note, saying never mind, they decided how to proceed on their own. Now we're all left to wonder and wait now.

LEMON: Two more hearings, two Florida courtroom, one court order, another decision pending. It's got to be the Anna Nicole Smith case that makes this -- cases.

And CNN's John Zarrella brings us up to speed. He's in Ft. Lauderdale with an order handed down less than an hour ago.

John, help us to understand what's going on here.

JOHN ZARRELLA, CNN CORRESPONDENT: Hey, Don.

Well, you know, last Friday, Judge Lawrence Korda asked basically, "Why me?" Kind of tipping his hand. The family court judge here in Broward County was asked by the attorneys representing Larry Birkhead -- that is the ex-boyfriend of Anna Nicole Smith -- to go ahead and order that Anna Nicole Smith's baby, baby Dannielynn, be given a swab for DNA, in the Bahamas.

And, at the same time, they asked the judge to order the release of some of the DNA samples that are being held here in Broward County to be given to their medical doctor.

Well, the judge today, the judge, Lawrence Korda, ruled, "Listen, I have absolutely no jurisdiction over baby Dannielynn. I can't order DNA to be taken from her. That's the jurisdiction and the province of the Bahamas. They're going to have to make that ruling. What I can do is order that the DNA samples be turned over to you." That DNA is a DNA sample of Anna Nicole Smith, again, taken, being held here at the medical examiner's office. So he did that.

And following that order, Debra Opri, the attorney representing Larry Birkhead, said that she viewed this as a victory. (BEGIN VIDEO CLIP)

DEBRA OPRI, LARRY BIRKHEAD'S ATTORNEY: We got what we came for. We came to Florida, because we wanted the DNA samples turned over to our doctor. We have two-thirds of the order completed. Now we're on to the Bahamas, where we've already had a hearing. And I fully anticipate the DNA will be completed within -- no later than a month.

I'm hoping Mr. Stern cooperates and does it voluntarily without any strings attached. I'm hopeful. I'm anticipating it. And the big -- the big discussion today is let's put Anna Nicole to rest.

(END VIDEO CLIP)

ZARRELLA: Of course, Debra Opri referring there to the Fourth District Court of Appeals about 50 miles north of here in West Palm, which is -- today, has listened to oral arguments on the request by Anna Nicole Smith's mother to -- seeking custody of the body of Anna Nicole Smith.

So the question still out there, where's Anna Nicole Smith going to be buried? Will it be in the Bahamas? Will it be in Texas? That question still out there. And who is the father of baby Dannielynn? That question, Don, still unanswered -- Don.

LEMON: All right. Thank you, John Zarrella.

PHILLIPS: It's far more common than we realize, especially for young women. Ahead in the NEWSROOM, a virus that causes cervical cancer and new findings you need to hear.

LEMON: Beaten back, but in no way extinguished. The Taliban flares again in Afghanistan and claims credit for a suicide attack near Vice President Dick Cheney. Ahead in the NEWSROOM, a man who's tracked bin Laden weighs in on the Taliban's return.

PHILLIPS: And a quick check of the markets as we go to break. After yesterday's drop -- well, check out the Dow Industrials, up 73 points.

Personal finance expert Suze Orman steps into the NEWSROOM in the 3 p.m. Eastern hour to talk about the stock market and also take your e-mails. You still have some time. E-mail us, CNNNewsroom@CNN.com.

(COMMERCIAL BREAK)

PHILLIPS: It's a quarter past the hour. Here's some of the stories that we're working on in the CNN NEWSROOM. Live on Wall Street, stocks are gaining ground after yesterday's global sell-off. We're going to talk with financial guru Suze Orman a little later.

Also, first step, but don't expect a break-through. State Department's caution as the U.S. and North Korea gear up for talks next week in New York. Tensions have eased since North Korea agreed to scale back its nuclear program. And we're waiting for a ruling from a Florida appeals court in the Anna Nicole Smith body battle. Meantime, another court is granting doctors hired by her ex-boyfriend access to her DNA samples. He's one of several men claiming they fathered Smith's baby girl.

LEMON: It is widespread, easily transmitted and for thousands of women, it's a killer, a killer they might not even know is stalking them. Human papilloma virus is the most commonly sexually transmitted disease n the U.S., and new numbers show it's far more common than you might think.

All day today, we're telling you what you need to know about HPV.

And joining us now is CNN medical correspondent Elizabeth Cohen. So tell us how common it is. How come it is? I think I know the answer. Very common.

ELIZABETH COHEN, CNN CORRESPONDENT: Very common. The answer's very common. You go out to a bar, trying to pick someone up, you look around, most of the people with -- many of the people within eye shot have HPV.

Let's take a look at the specific numbers. According to this report out today, this week, from the Centers for Disease Control, half of all sexually active men and women will get HPV sometime in their lifetime, half of them. That is obviously a large number.

Specifically, let's take a look at women. One in 4 girls ages 14 through 19 gets HPV. And nearly half of women ages 20 through 24 have HPV. The numbers go down as you get older.

Now, the good news here is that about 90 percent of people who get this infection, it will clear through their system within about two years. So it's not something that lasts forever and ever. But of course, during those years, they can transmit that to somebody else.

Now, if you want to learn more about HPV and other sexuality transmitted diseases, go to CNN.com/Health. We have a story about it today, how people are finding help actually on the internet when they have sexually transmitted diseases. It's been one of the most popular stories on CNN.com all day.

LEMON: OK, so you said it will go through your system and you'll clear it. But does that mean every woman who has HPV, will they get cervical cancer?

COHEN: No, most of them won't get cervical cancer.

LEMON: OK, OK.

COHEN: What happens is that people get HPV. And for most people, it's really not necessarily such a big deal; it just clears out of their system. But a small number of people will get cervical cancer. And also, a relatively small number of people will get genital warts. So there are two things you can get from HPV.

LEMON: OK. So then why just women are you vaccinating? Why not vaccinate...

COHEN: Right, the big story has been about vaccination. There's a vaccine out called Gardasil. And there's been a very heavy marketing campaign, and there's been a lot of talk about girls and women getting this vaccine.

And so many people say, gosh, why not boys and men? They're the ones who give it to the girls and to the women. The reason is, is that it just hasn't been tested in boys and men yet thoroughly. The tests are underway. Many doctors predict that in the coming years this vaccine will be offered to boys and men.

Now, it's interesting. They're offering it to girls and women now 11 years, up to age 26. After age 26, they say, chances are you probably already have it so...

LEMON: OK. So that's my next question.

COHEN: Right, might not be so helpful to get it after that age.

LEMON: OK. And you're going to be talking about this all day today.

COHEN: That's right. All day today and on CNN.com all the time.

LEMON: Thank you so much for that. It's very interesting. STDs, the facts, the figures and the personal impact. Elizabeth has much more tonight at 8, as she just said, all day on CNN but also tonight on "PAULA ZAHN NOW". So make sure you check that out.

Thank you, Elizabeth.

PHILLIPS: A hepatitis A scare on Los Hollywood's A-list. The Los Angeles County Health Department says an employee of Wolfgang Puck Catering may have exposed quite a few people to the hepatitis -- or the Hep A virus.

That worker, who's infected himself, prepared food for a "Sports Illustrated" swimsuit party as well as other events. Public health experts say that the risk is quite low, but anyone who ate raw food at the magazine's party on Valentine's Day needs to call the health department today.

The food at all those Oscar parties is believed to be OK. Now, "SHOWBIZ TONIGHT" host A.J. Hammer will have more on that in our next hour.

LEMON: Well, it's not exactly Frazier versus Ali yet, but the numbers are getting interesting. Ahead in the NEWSROOM, rating the heavyweights in the '08 presidential race.

PHILLIPS: Prince Charles is no burger king. So don't even get him started about McDonald's. A food fight turns into a battle royal. That's coming up in the NEWSROOM.

(COMMERCIAL BREAK) PHILLIPS: Right now, the Dow Jones industrial up 71 points. It fell 416 points yesterday. Many experts, including money guru Suze Orman, say the sell-off was overdue. Orman was a guest on CNN's "LARRY KING LIVE" last night.

(BEGIN VIDEO CLIP)

SUZE ORMAN, PERSONAL FINANCE EXPERT: Everybody's going, "Oh, my God." Let's put it in perspective. We're down about 4 percent. It started with the Chinese/Asian markets going down 9 percent yesterday.

And then we're looking at the prime rates going down and all these businesses, really, that have been lending to people who didn't have the money anyway to borrow for homes, starting to get in trouble. And we were due for a sell-off. It was only a 4 percent sell-off, I have to tell you.

LARRY KING, HOST, "LARRY KING LIVE": Did you see it coming?

ORMAN: No, you know, everybody saw that we needed -- we needed the markets to retrace. Everybody got that. Were they expecting it to happen all in one day?

What really kind of freaked me about it for a second was at 3 p.m. we were down some 200-odd points and then two seconds later we were down 500 points. I have never in my life seen the market fall 200 points in a second.

(END VIDEO CLIP)

PHILLIPS: You're going to hear much more from Suze a bit later in the show. The personal finance expert steps into the NEWSROOM, 3 p.m. Eastern hour to answer all your questions. You can e-mail a couple to us now: CNNNewsroom@CNN.com.

LEMON: And of course, we have been watching Wall Street since the market began to tumble yesterday morning. And by the end of the session, the Dow lost a whopping 416 points, the biggest drop since the market reopened after September 11.

And for a look at where stocks are right now, let's go to Susan Lisovicz. She's at the New York Stock Exchange. As a matter of fact, she's on the floor.

You've got a guest for us, huh, Susan?

LISOVICZ: I do. We have one of the pros, who can put it in perspective for us, along with Suze Orman, who talked about how long this may have been overdue. I'm joined by a 23-year veteran trader here, Stephen Foley, president of Integra Securities.

Stephen, how important was this rally today? I mean, sure, that sell-off was long overdue, but was this really important, that the market try to get back on its feet today?

STEPHEN FOLEY, PRESIDENT, INTEGRA SECURITIES: It was a good bounce-back rally. I think we're seeing the rallies in some of the issues that were oversold at the end of the day due to the uncertainty. We didn't know whether there was a glitch in the system, whether at the end of the day that real -- you know, that was a real sell-off or what was going on.

So certain issues were definitely overdone. And it's nice to see that, you know, they got back, a little bit of a bounce-back rally today, to -- you know, on some of the issues that were...

LISOVICZ: It actually got emotional, didn't it, yesterday, you know, when people couldn't figure out what was going on?

FOLEY: Absolutely. And it was a great opportunity for those of us on the floor to show what we can do with the human element still down here, where you know, there was an unexplained drop from 250 to over 500. And we were able to keep things in perspective and act on the orders that we had entrusted to our -- in our hand held.

LISOVICZ: Doing things the old-fashioned way instead of relying on the computers.

Talk about what's driving the markets today. The Dow hit its high, up 107 points when Ben Bernanke was doing Q&A. Was he really one of the big factors today?

FOLEY: It was one of the factors. I mean, I don't think there was anything big that came out on that end, but it's more of a bounce back from oversold levels yesterday.

And you know, speaking to a lot of our customers, they -- you know, we had a nice, long rally for a long period of time there. The volatility -- there was no volatility in the market. Everybody was getting a little complacent.

The sell-off happened a little quicker and faster than anybody expected, as they usually do. So right now, you know, people are happy to see a little bit of a bounce back, and they're taking a look at individual stocks once again, instead of just picking broad-based stocks and expecting everything...

LISOVICZ: Quickly talk about your customers, because you're dealing with the pros, the big mutual fund managers, the big -- the guys who are in the business, men and women who are, you know, see -- can see opportunity here. What are they telling you? What kind of orders are they putting in today?

FOLEY: Well, their job is to differentiate themselves from the rest of the market. So in situations like that, it's an excellent opportunity for them to put their skills to work. And...

LISOVICZ: What are they buying?

FOLEY: They -- I don't know what they're buying in particular. I have seen some, you know, broad-based rallies in some of the general holdings stay, but you know, overall, they're just looking at valuation. I don't see too much buying overall. You know, as far as individual issues that they've held.

LISOVICZ: Historically, when you have a big, decisive sell-off like this, do you usually see at least an attempt at a bounce back the next day?

FOLEY: Not always, but there's definitely caution, and trying to keep things in perspective. And you know, some of the overseas economic developments which occurred are keeping things in perspective here. But...

LISOVICZ: But a rally so far. We've got 2 1/2 hours to go with the trading session. But right now, the Dow industrials are showing some strength, up 90 point. But again, that could change. And we'll keep our eye on it.

And that's the latest from Wall Street, where there is a relief rally in place. NEWSROOM -- lots of NEWSROOM straight ahead. You're watching CNN, the most trusted name in news.

(COMMERCIAL BREAK)

PHILLIPS: Hello, everyone, I'm Kyra Phillips live at the CNN World Headquarters in Atlanta.

LEMON: I'm Don Lemon. It's 1:30 p.m. Eastern. Do you know where your investments are? We're taking your questions about what to do when Wall Street gets a major case of the hiccups. Get those e-mails in to us, financial guru Suzie Orman joins us with the answers. You're live in the CNN NEWSROOM.

It turns out the bulls didn't leave town after yesterday's sell- off on Wall Street; a live look now, at the Big Board at the New York Stock Exchange. The Dow Jones industrial average is up 98 points, almost 100 points. If you can stand it, let's take another look at yesterday's plunge, a 100-point drop at the start of the session, turned into 200 by midday.

But look at what happened around 3:00 p.m. Eastern. The Dow went from minus 285 to minus 524 in three minutes. Now, we're now hearing computer glitch made the drop appear more sudden than it was. The Dow finished the day 416 points in the red.

PHILLIPS: When the chairman of the Federal Reserve speaks, the markets listen. When the markets go into free fall a day before the Fed chairman speaks, well, just say the financial world was all ears. Ben Bernanke showed up today for a scheduled appearance before the House Budget Committee. He told the panel he doesn't perceive a single trigger to yesterday's drop.

(BEGIN VIDEO CLIP)

BEN BERNANKE, CHAIRMAN, FEDERAL RESERVE BANK: I don't think it would be useful for me to try to parse the movement into the components associated with different pieces of news, or pieces of information.

I will say that the Federal Reserve in collaboration with the president's working group, has been closely monitoring the markets. They seem to be working well normally. We've also, of course, been closely monitoring the economy. Looking at new data and trying to evaluate their implications for the forecast.

And my view is that -- taking all the new data into account, that there is really no material change in our expectations for the U.S. economy since I last reported to Congress a couple of weeks ago in the Humphrey Hawkins hearings.

(END VIDEO CLIP)

PHILLIPS: Now, over at the White House, Spokesman Tony Snow says the economy is fundamentally strong. Gone from the Fed, but still a force in the markets, retired Fed Chairman Alan Greenspan getting part of the blame for yesterday's sell-off, having speculated, a day before, the U.S. could slide into recession later this year. Many other economists say the odds of that are low.

LEMON: And then there are the Shanghai sneeze. A 9 percent plunge in one of the hottest financial markets in the world. CNN's John Vause explains.

(BEGIN VIDEOTAPE)

JOHN VAUSE, CNN INT'L. CORRESPONDENT (voice over): After the plummet, the comeback. China's share markets gained almost half of what they lost the day before, but, still, among many small investors, unease. Like this Mr. Lian, a retiree who is down about $1,000 U.S.

"I'm very nervous," he told me. "I don't know why there is such a sudden and sharp fall. It's rarely happened before, and there's no official explanation yet."

The Shanghai sneeze, as it's now called, spread across the globe sparking sell offs from Europe to New York, amid concerns that China's roaring economy may have started to slow.

FRANCIS LUN, FULLBRIGHT SECURITIES: China's economy is still growing so there is still fundament support for the market. It's just that it's overbought, and it needs a correction.

VAUSE: There's no sign of China's boom ending anytime soon. Some analysts warn there's no relationship between the value of shares and the health of the economy.

RICHARD MCGREGOR, FINANCIAL TIMES: People in global markets around the world could be using this as an indicator of something that's happening in the real economy is, to put it charitably, eccentric.

VAUSE: The last time China's stocks lost so much was on the day paramount leader, Deng Xiaoping died, 10 years ago. Back then, barely a glitch on world markets. But Tuesday's sell off underlines China's newfound influence in the global economy.

VAUSE (on camera): They say when the United States sneezes, the world gets a cold, but after this tumble on international markets, it could be that the world must now keep a eye on China's temperature as well. John Vause, CNN, Beijing

(END VIDEOTAPE)

PHILLIPS: Dick Cheney is back in the U.S. today in one piece. Yesterday, as you may know, somebody, possibly the Taliban, apparently tried to kill the vice president in Afghanistan. At least 15 people did die in a suicide bombing at Bagram Air Base.

Cheney was there, and in Pakistan earlier, talking Taliban, NATO, and, of course, Osama bin Laden. Let's bring in Michael Scheuer; he's a former chief of bin Laden unit at the CIA and the author of "Imperial Hubris: Why The West Is Losing The War On Terror."

Michael, it's always a great get to be able to talk to you. And I want to get your first response to what happened with regard to the vice president. Do you think the Taliban was trying to get to him? And is that ever a possibility? That they could get close enough, especially on a base like Bagram?

MICHAEL SCHEUER, FMR. CIA OFFICER: Sure, it's a possibility. When we go overseas, when our military forces go overseas, we hire a lot of local people to do chare (ph) force, and cooking, other kind of routine matters. So it's always possible to get into U.S. facilities in that kind of war-time situation.

I think they probably were trying to get Vice President Cheney. They're not very concerned with Mr. Karzai's government. They believe that government is only there because of the Americans. And they're trying to hit us as hard as they can.

PHILLIPS: How is it the Taliban just continues to grow and get stronger? Obviously, there's a number of factors. We talk about the drug trade. We talk about loyalists, and this and that and they're coming back to the country. What do you put -- what do you -- how do you add it up?

SHOYER: We didn't kill enough of them, frankly, when we invaded. We took the cities and declared victory. And we let most of the Taliban and Al Qaeda escape to Pakistan, or other places. And now they're refit, reequipped, and coming back.

So we're fighting the same -- the same bunch that were there the first time that we failed to kill. It sounds callous, but if you don't kill your enemy, they're going to come back again. That's what we're seeing in Afghanistan.

PHILLIPS: All right, well, that leads me to my next question. You say a lot of them went into Pakistan. What is the deal with Pervez Musharraf? Is he being tough enough? Pakistanis says look, we're doing everything we can, being as strong as we can on Taliban and Al Qaeda. Is it true? It doesn't look like it. SCHEUER: Well, Pakistan has done more than anybody had a right to expect them to do. I think you have to remember that Al Qaeda and the Taliban were not Pakistan's enemies.

Since 9/11, Musharraf has helped us capture dozens of Al Qaeda people. He's allowed us to expand our presence in his country. He's given us overflight rights. For the first time in Pakistan's history, he sent his army into the border area, which is an ungoverned area. It got beat three times and suffered more casualties than we have in Afghanistan.

So he's done quite a bit. I think Musharraf, to put it frankly, has done all he can and now it's going to be up to the United States.

PHILLIPS: Is he protecting Osama bin Laden?

SCHEUER: I don't think he's protecting him, but I'm very confident he doesn't want to turn him over. One thing that Americans don't like to talk about is Osama bin Laden is the hero of the Islamic world. Musharraf, after all, is the head of Pakistan. He does not want to cause great instability in his own country.

PHILLIPS: Do you think he knows where Osama bin Laden is?

SCHEUER: I don't think he does. I also think he doesn't want to know. But I don't think he does know where he is.

PHILLIPS: Does the U.S. care anymore?

SCHEUER: Oh, we should. As long as bin Laden is alive, Al Qaeda is the one entity on the Earth that can attack inside the United States?

PHILLIPS: Is the hunt still on for Osama bin Laden?

SCHEUER: I think, to the extent we have resources available, Kyra, yes. But so many of our intelligence officers and military people are tied up now, fighting the Taliban, that there's not a lot of resources left to spare to go after Al Qaeda, bin Laden and Zawahiri.

PHILLIPS: Look, this was your gig. This was your unit. What happened? Why didn't we get him?

SCHEUER: Mr. Clinton wouldn't kill hill. At the end of the day, you only get so many chances. We gave President Clinton 10 chances to kill him between May of 1998 and May of 1999. And he didn't do it. And Mr. Bush didn't get him when we had a chance to get him at Tora Bora in 2001.

PHILLIPS: But did you have your sights on him in Tora Bora, like you had your sights on him during the Clinton administration?

SCHEUER: I think the answer probably is, not. Although we could have -- if we used our own troops, could have hemmed him in there, and eventually would have gotten him. We subcontracted the job to a couple of Afghans who had fought alongside bin Laden against the Russians.

PHILLIPS: So, you -- during the Clinton administration, how did you know that you had him? You knew exactly where he was and that you would be able to get him?

SCHEUER: We had signals intelligence. We had human intelligence. And we had satellite imagery that corroborated it.

PHILLIPS: So did the president think, well, he just isn't a big enough threat yet?

SCHEUER: I'm not sure, ma'am. The answer many times was simply they were afraid of what international opinion would say if we tried and we missed; or if there was collateral damage to buildings or other people.

PHILLIPS: It's a shame it takes a 9/11 to finally get serious about that chase for him.

Final question, the president -- the vice president never said anything publicly, but I'm looking at the various statements, from various sources, and various papers that said there were reports that warned Musharraf -- that Vice President Cheney warned Musharraf that Congress might cut off aid to Pakistan if he does not do more to fight Al Qaeda. Do you think that the administration will do that? And is that the right answer?

SCHEUER: It's a very empty threat. If the Americans cut off aid to Pakistan, the Pakistanis stop helping us. It's Pakistan that has the whip hand here. Mr. Cheney, I'm very sure, was told by President Musharraf that he's done all he can. It's really idle threats at the moment from Washington.

PHILLIPS: Michael Scheuer, always interesting to talk to you. Appreciate your time.

SCHEUER: It's always a pleasure. Thank you.

LEMON: It's not exactly a prize fight yet. But the numbers are getting interesting. Ahead in the NEWSROOM, rating the heavyweights in the '08 presidential race.

(COMMERCIAL BREAK)

LEMON: She is still the front-runner, but those footsteps behind her seem to be getting louder. A new poll shows Barack Obama is gaining ground on Hillary Clinton in the race for the Democratic presidential nomination. CNN's Senior Political Analyst Bill Schneider joins us now, from Washington, with the latest on the presidential politics.

Bill, according to the polls at least, who's on top for the Democrats?

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Hillary Clinton. She's on top. She was on top last month. She still is. But it's getting to be a little bit closer. Last month -- well, this is the current figure. This month, the ABC News/"Washington Post" poll shows Hillary Clinton 12 points ahead of Barack Obama.

His support is up pretty sharply from 17 points last month. Hers is not -- a little lower than it was last month. But the point is, he's making some gains, and he's making some significant gains in the African-American community, where she previously has dominated.

LEMON: Let's talk about those gains. Because it's kind of odd to think -- you know, him being an African-American and not having African-American support. But he is gaining ground in that particular demographic, correct?

SCHNEIDER: That is correct. Largely because in the past he wasn't well known among African-American voters; he's getting well known. He has declared his candidacy. As you can see, his support has more than doubled among African-American Democrats.

And Hillary's support has -- Hillary Clinton's support has fallen quite a bit. Not necessarily because African-American Democrats don't like Hillary Clinton. Her favorability rating is extremely high and remains high among those voters. But they've seen Barack Obama, they like what they see. And of course he's an African-American, so he's giving her real competition for that key Democratic vote.

LEMON: Of course, there's also the Bill Clinton effect, very well liked by African-Americans. In fact, people joke, saying he was the first African-American president. So that part of it, that's a little bit odd. It's going to be tough, people liking Bill Clinton and then also Barack Obama being African-American.

SCHNEIDER: Yes.

LEMON: Let's talk about the Republicans now. America's mayor is gaining a big lead in the race for the White House, as well?

SCHNIEDER: He's the other candidate showing momentum. Right now, the front-runner in the Republican race, by a good margin, almost 2-1 over John McCain. Rudy Giuliani's support has jumped considerably about 10 points since last month. And John McCain has slid a little bit, in large part, as you indicated, because of Rudy Giuliani's leadership image after 9/11. If Rudy Giuliani is 9/11, John McCain is Iraq, which is, even among Republican voters, not the most positive image they want to portray.

LEMON: But this lead for Rudy Giuliani, Bill, I understand, is coming from an unlikely source --

SCHNEIDER: Very unlikely.

LEMON: -- for the pro-choice, pro-gay candidate he is.

SCHNEIDER: Yes, indeed, he is pro-choice, he supports same-sex civil unions, not gay marriage.

LEMON: Right.

SCHNEIDER: But, yet, among evangelical Republicans, look at this, Giuliani's support has really jumped from January to this month. McCain's support has dropped in that constituency. That's a very interesting development. It's obviously tied to his 9/11 leadership image. Perhaps they know his position on the issues, a lot of them don't.

And in the poll, they asked voters after they expressed their preference if you knew that Rudy Giuliani supported same-sex civil unions if you knew that he supported abortion rights would you still vote for him? About a third of his supporters say -- in the Republican Party -- say they would not. So there could be some shakiness in his Republican support.

LEMON: All right. Bill Schneider, always breaking it down for us. We appreciate your perspective. Thank you for joining us.

All right, tornado warnings in Florida. Reynolds Wolf what do you know?

REYNOLDS WOLF, CNN METEOROLOGIST: This just came in from the National Weather Service. Tornado warning for eastern Broward County in South Florida, it will be in effect until about 2:30 local time.

Here's that cell we're talking about. Let's zoom in on this. Coral Springs, part of I-95, A1A, to from Lighthouse Point to Pompano Beach, heavy, heavy storms developing. This is the one we believe is rotating. This is not been confirmed with visual confirmation, this is just that Doppler's indicating the storm is rotating, and it may spawn a tornado. Certainly, you want to be on the lookout.

Storm expected to pass through eastern -- or near Pompano Beach around 1:51 p.m., through Fort Lauderdale at 2:05 p.m. Just over the past hour they've had about five to 10 lightening strikes but they're expecting more of these as the storm rumbles to the southeast.

Again, we're seeing a few more cells pop up a bit farther to the north from here. This is the only one spawning that possible tornado. We'll keep a close eye on this for you. As we get more information, we'll send it back to you at the news desk.

PHILLIPS: Thank you, Reynolds.

WOLF: You bet.

PHILLIPS: Well, a common virus, a growing controversy. Ahead in the NEWSROOM, who decides whether young girls get vaccinated against a sexually transmitted disease?

(COMMERCIAL BREAK)

LEMON: Developing story on the weather front. Let's check in with Reynolds Wolf.

What do you have, Reynolds? WOLF: We still have the tornado warning in effect for eastern Broward County, until 2:30 local time. Let's zoom in on that area. It's just to the north, at this time, of Ft. Lauderdale, south of Coral Springs. If you happen to be tuning from Coral Springs, or Lighthouse Point, you're actually in the clear. The storm moving to the south-southeast about 20 miles per hour. That possible tornado expected to move into, say, Wilton (ph) Manors, or Fort Lauderdale within the next 20 minutes or so.

What you're also seeing is there's a new way that the National Weather Service posts these warning for specific counties. It's not going to be the entire county. You're going to see more of a polygon that will really just be in effect for the areas that may be affected for the storm system.

Now, again, there has been no visual confirmation on this possible tornado. This storm is just rotating, which means it is possible that a tornado may spawned from it. Nevertheless, please be advised at the possibility for some large hail, damaging winds and, of course, deadly lightning. If you happen to be, say, in Wilton Manors, or perhaps Fort Lauderdale, you'll certainly want to indoors. Lowest room in the house, away from exterior walls, away from windows. You should be just fine.

We're keep an eye on this for you. This tornado warning in effect until 2:30 Eastern time, but keep in mind, we're watching quite a few other things around the nation. We have this area of low pressure is just chugging through parts of the Central Plains, through parts of Arkansas, even into Missouri.

Especially, by late afternoon, into the evening and overnight, we've got a very good possibility of some severe storms popping up. We're talking about the Potential for some severe thunderstorms. Some possibly producing some tornados as well. That's certainly an area we'll watch for you.

Meantime, farther to the north, in the Twin Cities, it's going to be snow. You'll remember just this past weekend, the Twin Cities had over a foot of snowfall. From now over the next 24 to 48 hours they could see another 12 inches of snowfall on top of that. And in place like Detroit, Michigan, for example, take a look at this live image we have for you, compliments of WDIV, a little farther up the Detroit River, back over to Lake St. Claire, we have one community in Michigan, that is completely clogged by ice.

We'll show you some video from I-Reports, as well as other photographs, from around the great state of Michigan. I'll show you how Mother Nature is really giving those folks a major icy headache.

That's coming up in a few moments. And, of course, the very latest in Florida with the possibility tornado. Back to you.

LEMON: And with those tornados, we say it every time, but an ounce of prevention, Reynolds.

WOLF: No question about it, always be on your guard. LEMON: Thank you, sir.

WOLF: You bet.

PHILLIPS: A controversial congressman who has bounced from one key assignment lands another. The story straight ahead in the NEWSROOM.

LEMON: And Prince Charles is no Burger King, so don't even get him started about McDonald's. A food fight turns into a battle Royale. That's coming up in the CNN NEWSROOM.

(COMMERCIAL BREAK)

PHILLIPS: British monarchs no longer rule by decree, which is good news for McDonald's after some hard to swallow remarks by the heir to their throne. As ITN's Romilly Weeks reports, Prince Charles made it clear he's no Golden Arch supporter.

(BEGIN VIDEOTAPE)

ROMILLY WEEKS, INT REPORTER: Another royal tour, traditionally a chance for some quiet diplomacy, but not for Prince Charles. In the United Arab Emirates he's made his views on healthy eating crystal clear. This time, McDonald's is in his line of fire.

Talking to a local nutritionist, Charles is said to have asked, have got anywhere with McDonalds? Have you tried getting it banned? That's the key. Court reporter Tony Jones could hardly believe what he was hearing.

TONY JONES, COURT REPORTER: I was a little surprised and kept on scribbling really, just trying to get it down. Then after that, I thought, wow, how could he have said that, you know, at a public event, maybe privately, but not in public.

WEEKS (On camera): So unlike millions of people, Prince Charles clearly isn't a fan of these. His prerogative. But in attacking McDonald's, he's not only taking on a company that hasn't been shy about suing its critics, he's also once again stepping outside the traditionally neutral royal role.

(Voice over): Already McDonald's are fighting back, saying, "We know that other royal family members have visited and have probably got a more up to date picture of us. It's disappointing as he's clearly unaware of some of the moves we've made, over time, to improve choice and variety on our menu."

It's not the first time the prince has got into hot water for his outspoken views. There was the infamous incident with Nicholas Whitchell (ph).

PRINCE CHARLES: Bloody people. I can't bear that man. He's so awful, he really is.

WEEKS: Some say the prince needs to curb his tongue.

UNIDENTIFIED MALE: He has overstepped the mark. And he has gone into an area of which he has a certain amount of information, but not very much. I mean, all he has to do is look to the queen. Does she ever make crass remarks like this? The answer is, never.

WEEKS: (UNINTELLIGIBLE) said Charles was trying to emphasize the need for children to eat a balanced diet, in a country that has a huge problem with diabetes. On a tour that was attracting very little in the way of media interest he found a provocative way of making the headlines. Romilly Weeks, I TV News.

(END VIDEOTAPE)

PHILLIPS: Next hour of CNN NEWSROOM starts right now.

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