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American Morning

Tragedy in Utah Mine Rescue Effort; Fed Cuts Discount Rate

Aired August 17, 2007 - 08:00   ET

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

(BEGIN VIDEOTAPE)
KIRAN CHETRY, CNN ANCHOR: Breaking news. Another cave-in at the mine in Utah. Three rescuers killed trying to reach the trapped miners.

UNIDENTIFIED MALE: It's scary. It makes you think about the career you've taken.

CHETRY: What went wrong? What now for the rescue...

GOV. JON HUNTSMAN (R), UTAH: We've seen too much over the last week and a half. We need to make sure that safety is of paramount importance.

CHETRY: ... and for anguished families?

MAYOR JOE PICCOLO, PRICE, UTAH: This community is one that is unbelievably coordinated to helping someone who is in need.

CHETRY: The minute-by-minute developments live from the scene on this special edition of AMERICAN MORNING.

(END VIDEOTAPE)

CHETRY: It's Friday, August 17th. I'm Kiran Chetry.

And we start the morning with some sad news out of Utah.

ROB MARCIANO, CNN ANCHOR: Unfortunately so.

John Roberts is off. I'm Rob Marciano.

And it's 8:00 here in the East Coast, 6:00 in Huntington, Utah, where the rescue operation at the Crandall Canyon Mine is on hold after a second collapse last night.

CHETRY: That killed three rescue workers, injuring six more. They were trying to reach the trapped miners when the walls simply caved in. It's what miners call a mountain bump.

We're going to be talking to a seismologist about exactly what that means coming up. But for now, the search is on hold.

We talked with Utah's governor, Jon Huntsman, earlier on AMERICAN MORNING.

(BEGIN VIDEO CLIP)

HUNTSMAN: I, for one, as governor of the state, feel pretty strongly that we shouldn't let another person in the underground mine until we can guarantee their safety. We've seen too much over the last week and a half, and we need to begin to learn from some of these lessons.

So, when I do meet with MSHA just in a couple of hours in the morning here, I'll want to get certain guarantees that there will be worker safety. And I know that the rescue effort is something that many had participated in and are very anxious to continue, but we need to make sure that safety is of paramount importance.

(END VIDEO CLIP)

CHETRY: Well, the mine's owner says that rescuers are still over a thousand feet from reaching the section where the miners are believed to be working -- Rob.

MARCIANO: Well, there's still hope for the six rescued miners who did survive. But hope may be lost for the six men they were trying to rescue, with questions about safety dominating news today.

We're covering the latest developments from every angle this morning. CNN's Brian Todd is at the mine. Kara Finnstrom is at the hospital. And Dr. Sanjay Gupta is in Atlanta with his medical perspective.

We begin first with Brian Todd at the entrance to that mine.

Good morning again, Brian.

BRIAN TODD, CNN CORRESPONDENT: Good morning, Rob.

It's important to point out at this point which parts of this operation are continuing and which facets of it are going to be on hold. What we're told is that the actual drilling from the top of the mountain is going to continue, possibly today.

Now, there was a fourth hole that was being drilled since yesterday to try to reach a chamber where these men, the six missing miners, might have retreated to. We are told that that drilling is going to continue. But the critical digging part where they're physically trying to reach the six missing men has been halted indefinitely while they investigate what happened last night, this mountain bump that killed three rescue workers and injured six others.

Some very tough questions are going to have to be asked and answered regarding the safety precautions that were being taken up to that point. We were told by the mine owner, Bob Murray, that the operation was safe. Well, clearly, there were some problems there, and these mountain bumps were a recurring problem. Late last night was the critical one that caused such devastating injury and death, but there were several others leading up to that.

Yesterday, they had one, a mountain bump, that actually covered -- it kicked out rubble that was so intense and so voluminous that it covered one of those so-called continuous mining machines. These are the big, heavy machines that actually plow through the rubble and churn it back. They're very large.

One of those mountain bumps yesterday covered one of those machines. It set them back again, but they kept going.

And every step of the way, when they drill in, they've been kind of fortifying the walls, the roofs and the floors of these -- of the main mineshaft as they go with hydraulic jacks, with timbers, with other paneling. So this is what they're going to talk about, what they've done. And they're going to have to answer some very critical questions -- excuse me -- about where they go from here -- Rob.

MARCIANO: Brian Todd live for us at the entrance to that mine -- Kiran.

CHETRY: Thanks, Rob.

Well, the ambulances and the helicopters rushed to the site last night. They came from as far away as Salt Lake City, 140 miles from the scene. And the six surviving rescuers were treated at hospitals overnight. At least three now are in serious condition.

CNN's Kara Finnstrom is at Castleview Hospital. This was the closest one to the mine.

Kara, are you getting any new information this morning?

KARA FINNSTROM, CNN CORRESPONDENT: Well, a little bit of new information. We just spoke with the mayor of Price -- that's the city we're in -- Joe Piccolo. And he was in visiting with the families of the rescuers who are being treated here. Those are three different rescuers that are being treated here. And he tells us that from what he learned from these families, their conditions are improving. Now, that is all he could tell us, but it is encouraging.

The last official word we had from the hospital officials here was that these three rescuers who are being treated here do have some serious injuries. There was one other rescuer who was brought to this hospital. He died shortly thereafter. And was one of the three rescuers that we know that died because of this cave-in.

One other rescuer was transported right away to a hospital with better trauma facilities. This is a small hospital. It's just about 45 minutes from the mine site. It's the closest hospital, but it doesn't have all of the trauma facilities needed to treat some of these serious head injuries that we're told they're seeing.

And the good news out of this, Kiran, one person who was brought here, one of the rescuers, was actually treated and released.

But the other note coming out of here is that a lot of these families will be waking up this morning and just learning about the fact that there are more injuries, more concern tied to the mine, that nine more people were hurt, three of them killed, because of this collapse. Some of them came to the hospital overnight trying to get word as to who exactly had been hurt and the extent of the injuries. So as daylight breaks, a lot of concern in this community we're about to see.

CHETRY: And this has been going on for more than 12 days now after that initial collapse, and the hope that they can get these other six out alive.

Kara Finnstrom in Utah for us.

Thank you.

MARCIANO: CNN's chief medical correspondent, Dr. Sanjay Gupta, now joins us from Atlanta. He's been following this all morning long, the emergency response, what kind of injuries these guys have had, and how the doctors are treating them.

What do you know right now, Sanjay?

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Yes. I was just talking to -- trying to get some more information from one of the hospitals there in Utah.

We do have more information than we did. Information is continuously being updated.

As you know, we're talking about nine people here. Three of them, unfortunately, died.

Of the six that are still alive, they're being treated at various hospitals around that area. We know, for example, one person has significant head injury but is alert, breathing on own, which is a very good, important prognosticator, you know, predictor of how that person will do.

Another person, the best news, was treated and released.

Of the four other additional patients, one has head injuries and had to be airlifted to a bigger hospital, the University of Utah, a level one trauma center. We don't know exactly why, if that patient needed surgery or needed more sophisticated care in some way. Three patients are being taken care of that hospital in Castleview, which typically takes care of significant, yet more minor, injuries than the big university hospital.

This sort of -- you know, just still a dynamic situation, Rob. I imagine there's going to be updates throughout the day. Some of these patients may still be sort of in a dynamic situation, still requiring stabilization. And we don't know exactly how they're going to do. It sounds from Kara's last report that they are a bit more optimistic about those three patients being taken care of there at Castleview, but I think we're going to get some more information here shortly.

MARCIANO: More information. We'd like to have more updates. We'd like to have them, just haven't gotten, is with the six miners that are still trapped.

What do you think their chances of survival are?

GUPTA: Well, you know, this is also a difficult situation just because of the lack of information as to exactly what their situation is now and what happened at the time of that initial cave-in. Were there injuries at that time, and have they been able to get to any of these resource caches that Alina Cho has been talking about?

As a general rule of thumb, though, Rob -- you know, and this is always a little morbid to talk about -- but someone can survive without oxygen for a few minutes, without water for a few days, without food for a few weeks. That can all change depending on situations like hypothermia, what the overall oxygen concentration is in the air that they're breathing, what the levels of carbon dioxide are. So it's very hard to make any predictions based on that alone.

Again, we're hoping to get more information, hoping to get more information about the air quality, the survivable space, and whether these miners are in some sort of stuporous-like coma or whether they're awake and alert and able to take care of themselves in some way.

MARCIANO: CNN's Dr. Sanjay Gupta.

Thanks, Sanjay.

GUPTA: Thank you.

MARCIANO: We're joined now by the mother of one of the rescue workers who was inside the mine. He's OK, but he knows all about the injured, at least a little bit. And we're going to find out more about that right now.

Patsie Christie joins us by phone, the mother of one of the miners in there.

First of all, Patsie, tell us about your son. Is he OK? And what did he experience last night?

PATSIE CHRISTIE, MOTHER OF MINER: All I know is that he called his wife last night and said he was OK. I haven't talked to him. He's home, he's with his wife and son, and probably trying to get some rest.

MARCIANO: No doubt about that. What can you tell us that he may have told you about the other eight guys that were in there trying to rescue the six trapped miners?

CHRISTIE: I haven't talked to him. Like I said, he was not able to talk very much.

MARCIANO: How is he...

CHRISTIE: So I don't know. I don't know.

MARCIANO: Aside from being tired, how is he holding up mentally?

CHRISTIE: I -- well, she said he's not in good shape, but he's OK physically, that he wasn't hurt. I know he was -- he was in there. He probably had to help bring some of his friends out. So I don't imagine he's in real good spirits today.

MARCIANO: Like many people in that community, your family is one of mining. I'm told you're a miner. Your husband, a former coal miner.

CHRISTIE: Yes.

MARCIANO: And your brother-in-law died in a mine accident.

CHRISTIE: My brother-in-law died at the age of 25 in a coal mine in Colorado. And two days after the funeral, my brother and my brother-in-law and myself were back in the coal mines.

MARCIANO: What goes through your head when not only is there a mine accident and somebody dies, but a family member dies and you march right back into your -- into the mine after that sort of personal event and that danger fresh in your mind? How do you overcome that?

CHRISTIE: Yes, I no longer work in the mine. I left the mine 26 years ago.

MARCIANO: But you went in shortly after your brother-in-law died.

Do you think -- do you think your son is going to go back to work in the mine?

CHRISTIE: Yes, I think he will. People here do that. It's the way of life. That's their living.

That's what they do. And I'm sure he will. And I have two sons in the coal mines right now. And one should be just leaving to go to work in Wyoming right as we speak.

MARCIANO: Well, our hearts go out to you and the community there. We're very happy that your son is OK.

Patsie Christie, mother of one of the rescue workers involved in that accident last night.

Thank you, Patsie -- Kiran.

CHETRY: Well, it's time now to check in with our AMERICAN MORNING team of correspondents for other stories new this morning.

And we are watching Hurricane Dean grow stronger this morning. It is on the move as well.

(WEATHER REPORT)

(STOCK MARKET REPORT)

MARCIANO: The search for survivors after yesterday's deadly earthquake in Peru tops our "Quick Hits".

The latest, the U.S. Geological Survey has upgraded the quake to a rare 8.0. More than 500 people killed and more than 1,600 others were hurt.

And NASA said it does not need to repair the hole in the space shuttle Endeavour before it returns to Earth. NASA made the decision last night after tests show the gash in the shuttles tiles will hold up when it returns to Earth.

And in a moment we're going to go back to Utah. The rescue mission is on hold after a second collapse.

What caused it? We're going to ask a seismologist ahead if he has any insight.

That's coming up on AMERICAN MORNING.

(COMMERCIAL BREAK)

MARCIANO: Welcome back.

Watching the markets, among other things. Just getting word now the Federal Reserve declaring a "downside risk" to the economy, so they've lowered the discount rate by a half a point. No doubt that will have an effect on the markets, and we'll get to Ali Velshi in a little bit for his insight on what the markets may do today.

"Quick Hits" now.

The heat wave across the South has killed at least 37 people. The mercury topped out at the 105 in Memphis, Tennessee. Eight people have died in that town.

And a wildfire in Montana is threatening about 60 homes west of Missoula. Residents there have been told to evacuate. Firefighters say winds were so gusty that an inferno was growing in almost every direction.

And firefighters do have control of fires in the suburbs of Athens, Greece. It burned thousands of acres of pine forest. Dozens of homes were destroyed and many others were heavily damaged.

CHETRY: Well, they're calling it a mountain bump, this movement that caused coal and rubble to come crashing down at a Utah mine. Three more rescue workers killed because of that and six others taken to the hospital.

So what causes this to happen?

Joining us now on the phone, Lee Siegel. He's a spokesman for the University of Utah Seismograph Stations.

Thanks for being with us this morning, Lee.

LEE J. SIEGEL, UNIVERSITY OF UTAH SEISMOGRAPHIC STATIONS: Good morning, Kiran.

CHETRY: Could you explain in laypeople's term what this mountain bump phenomenon is?

SIEGEL: Well, like the main event that triggered -- that was the original collapse on August 6th, this bump last night was recorded on the seismic network operated by the University of Utah Seismograph Stations. It was recorded as magnitude 1.6 seismic event at 6:39 p.m. Mountain Time on Thursday night. It was very shallow.

While there's a great deal of uncertainty of locating these -- you know, locating earthquakes and seismic events, this -- our indication was it was about a tenth of a mile or less from the surface, which is very, very shallow and not at all like a natural earthquake. The seismic waves generated by this bump, like the original event, are consistent with a downward motion. And the statement I received from our seismic analysts was that these events are being related to the ongoing settling of the rock mass following the main event.

CHETRY: So it does -- so what you're saying, it doesn't have to do with the tunneling that's taking place horizontally to get into the 1,600, 1,800 or so feet?

SIEGEL: We can't say anything about what triggered it. We can just say what happened there.

I mean, the seismologists are experts in earthquakes, not in mining. But I can say that the downward motion is consistent with mining and due seismicity. It is not consistent with a natural earthquake, which has different motion. The seismic wave signature is the same as for the main event, which is a downward motion consistent with a collapse somewhere within that mountain.

CHETRY: All right. Let me ask you this, Lee. Does this area get earthquakes?

SIEGEL: The area gets a lot of seismicity. And on our Web site, the seismic station people posted an update a couple of days ago that was quite interesting to me. It says that of all the seismicity in this sort of arc-shaped region of coal mining in eastern Utah, only two percent of all the seismic events are natural earthquakes, two percent or less. In other words, 98 percent of the recorded seismicity there is related to mining.

CHETRY: OK.

SIEGEL: I can't speak to this particular event, but it's certainly consistent with the overall pattern.

CHETRY: So there's not -- there's not typically naturally occurring earthquakes because of fault lines in that area? SIEGEL: There are some faults and some naturally occurring earthquakes, but like I say, the history is they're less than two percent of the total. One in 50 seismic events there is a real earthquake, 49 out of 50 are due to mining.

CHETRY: All right. Lee Siegel, spokesman at the University of Utah Seismographic Stations.

Thanks.

SIEGEL: Thank you.

MARCIANO: And we're following other breaking news this morning out of the financial markets. The Fed has declared a half-point cut in the discount rate, and that's going to affect the markets today, no doubt.

Ali Velshi is working that angle of the business story, and we'll talk to him right after this break.

Stay with us.

(COMMERCIAL BREAK)

MARCIANO: Want to get to Ali Velshi right now with remarkable news out of the Federal Reserve. They have cut interest rates by a half a point.

Ali, put this all in perspective for us and what's going to happen going forward.

ALI VELSHI, CNN CORRESPONDENT: This just happened. This is not the interest rates that we always talk about. This isn't the 5.25 percent federal funds rate.

This is the Fed discount window. Let me quickly explain this to you.

The fed funds rate, which is the one we always talk about, the 5.25, is the rate at which financial institutions can lend -- borrow and lend money to each other. That is the interbank rate.

There is another option. When you think that you can't get money, if you're a financial institution, you can go right to the Fed and borrow money directly. Big banks can do this. They are short- term loans.

That thing has been going at higher rates. That's been 6.25 percent. If a bank wants to go to the Federal Reserve to borrow money because it has got problems, maybe because of subprime mortgages or something else, it pays 6.25 percent.

The Federal Reserve has just announced that it is cutting that discount window by 50 basis points, by one -- by one half of a percent. So that rate is now 5.745 percent. For banks that have liquidity problems, banks that have people going to them and saying we are out of money, we need -- we want to cash in our investments, those banks can go to the Federal Reserve, and for 5.75 percent, borrow emergency money. That is a big move to inject liquidity into the system, it is a very rare move by the Federal Reserve.

And just to give you an impression, we were talking earlier about how the Dow futures were down about 140 points. We're trying to track them now. They are moving very quickly, but they are up about 86 points, 96 points, 106 points. As I'm talking to you, 116 points.

It is going up every time I look at it. Now 126 points.

European markets, which were negative for the morning, have all turned positive on this news. They're rallying quite a bit at the moment. In fact, this is one of those situations, Rob, where trading is moving faster than we can actually keep track of it right now.

So, we are looking at a positive open on the New York Stock Exchange, on the Dow Jones in the next one hour. What a remarkable change in sentiment.

The Dow Jones -- the Federal Reserve cutting the discount window rate for their interest rates to 5.75 percent. They cut it 50 basis points. That's a big deal.

MARCIANO: It is a big deal. A lot of folks on Wall Street have been asking for the Fed to make a move here the last several weeks.

VELSHI: That's right. This is the move. This is one of the moves they've been asking for, and this is one of the moves they've got.

MARCIANO: Ali Velshi, thanks.

VELSHI: OK.

MARCIANO: Kiran.

CHETRY: So, we've seen it having an impact on the futures. Is it going to have an impact on the housing market and the mortgage problems right now related to the mortgage lending market?

Well, our personal finance editor, Gerri Willis, is here and she's going to tell us what the future may hold, especially with this new news about the discount rate being lowered.

GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Well, this is good news for the housing market, Kiran. I've got to tell you, if there is more liquidity for people who loan money to consumers who buy houses, that's going to make the housing market better.

The big concern, of course, has been that people couldn't get money to buy homes even if they wanted to. This should help, so it is very good news. And, of course, you may be wondering, how do we know when we're rock bottom in this market? I know a lot of people are asking that question. Certainly asking me that question. And unfortunately, it's really a rearview mirror kind of conversation.

You don't know until it's passed. And that's because the information, the closings typically aren't made public until three months after they happen. So you won't see that bottom of the cycle until it's about three months behind us. So, a little tricky, but, you know, it's a typical problem with any economic indicator.

CHETRY: OK. So with this news of the discount rate being cut by a half a percent, will we start to see a turnaround in the market? And if so, when?

WILLIS: Well, from your lips to God's ear. I certainly hope so, but, you know, it's a cycle.

People forget that it's a cycle out there. It turns up, it turns down. Bottom fishers are already looking for deals out there and they're starting to find them.

But I just want to share some numbers with you about previous cycles. Let's look at Boston in the late '80s, early '90s. There are some interesting numbers there.

You can see them right here, between '83 and '85. In that single market, prices zoomed up almost 160 percent. And then they fell. And everybody talked about the crash.

The crash was only, I believe, 15 percent. So you can see that people who held over a long period of time, they didn't lose money.

So you've got to really think about your own time horizon when it comes to owning a home.

CHETRY: All right. Gerri Willis, thanks so much.

And be sure to catch Gerri on "OPEN HOUSE" this weekend. She'll have much more on the mortgage meltdown, plus how to choose a home contractor. And also new rules for workplace etiquette.

Sounds very interesting. It's all starting Saturday, 9:30 a.m. Why is everyone looking over at Rob now?

WILLIS: I don't know, but we are.

MARCIANO: Because I'm next.

CHETRY: You sure are.

MARCIANO: With our top story.

The underground search for the six trapped miners has been suspended indefinitely after three rescue workers killed and six others injured. It's not clear what the rescue workers were doing when the mountain bump happened. Details ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

MARCIANO: Good morning. Welcome back. It's Friday, August 17th. I'm Rob Marciano in for John Roberts.

CHETRY: I'm Kiran Chetry.

We're following the latest out of out of Utah this morning. Crews say that nine rescuers who went in to save the six trapped miners who've been underground for 11 days were caught in an eruption of coal and rock. The end result three were killed and six others hurt.

It was something that mine officials are calling a mountain bump. The mine's owner says the mountain is still alive with movement forcing at least two delays over the past two days. The governor today of Utah demanded the underground search stop until officials can guarantee rescue workers' safety.

We talked with him a few moments ago.

(BEGIN VIDEO CLIP)

GOVERNOR JOHN HUNTSMAN, UTAH: I, for one, as governor of the state, feel pretty strongly that we shouldn't let another person in the underground mine until we can guarantee their safety. We've seen too much over the last week and a half. And we need to begin to learn from some of these lessons.

So when I do meet with EMSHA in a couple of hours in the morning here I'll want to get certain guarantees that there will be worker safety and I know that the rescue effort is something that many had participated in and are very anxious to continue but we need to make sure that safety is a paramount importance.

CHETRY: You know you talk a lot about it and we've heard about the inherent danger in mining. This particular mine sits high on the mountainside, 1800 feet above the mine is the mountain site. The nature of the location puts intense pressure on the pillars and the bolts of the tunnel. Is this particular type of mine and where it's situated inherently more dangerous?

HUNTSMAN: You know, not being a miner, I don't know the answer to that. All I can tell you that the conditions in the environment in which they're working, that is EMSHA and the rescue teams, is really quite unprecedented. From what the EMSHA people have said, they've never seen anything quite this deep before, which does add a level of complexity and danger, obviously, to this kind of operation.

(END VIDEO CLIP)

MARCIANO: We want to get back to Dr. Sanjay Gupta in Atlanta who has been following the medical side of this story all morning long and now has an update on one of the rescue miners there. That do you have Sanjay? DR SANJAY GUPTA, CNN CORRESPONDENT: One of the patients, miners we've been most concerned about was one air-lifted to the university hospital about 50 miles away. That's done often times in situations where the patient might need an operation or some sort of resources of a trauma center.

We're just getting new information in that the patient has non- life threatening injuries. Currently has no life-threatening injuries so that's a little bit of good news there. That was a patient that sort of out of those six patients that are alive, sort of was raising the most concerns about how that patient was doing. Requiring that sort of urgent air-lift, non-life threatening injuries is what we heard from the hospital a couple of minutes ago, Rob.

MARCIANO: You as a trauma brain surgeon, are you surprised of this good news considering them air-lifted this guy to a bigger hospital?

GUPTA: I'm not surprised by it. I think in these sorts of situations the paramedics and people on the scene will error on the side of caution. Obviously a lot of times making decision to air-lift a person to the hospital like this is based on what we call the mechanism of injury.

He may have had a significant mechanism of injury but it sounds like was able to actually go through that OK. It doesn't mean he's not still in serious condition but it sounds like he is going to survive this which was something that was of concern even up to a few minutes ago.

MARCIANO: One thing certainly that has been obvious is the response. They seem to have gotten the guys out of the mines quickly and ambulances and choppers there. Break down for us how this unfolded last night.

GUPTA: Yes, you know it was interesting because I started reporting this around 10:00 last night. At first we heard that there were three ambulances gone and then four and then Dan Simon was on the air talking about the fact six ambulances were going so people were sort of getting more information and probably sort of exercising and executing more resources based on that new information. Then there were two helicopters also deployed. I think it was a situation that was influx for sure.

The way it works, Rob, at the scene is that literally paramedics and health care personnel on the scene are making decisions. In this country we have what is called a scoop and run sort of triage system. We want to get the person, stabilize them as much as possible or get them to a hospital or tertiary care center and those decisions are sort of made literally on the fly.

As you know, patients were taken to hospitals sort of all over that area. Based on their severity of injury, some patients may, in fact, sometimes be transferred from one hospital to another after they're evaluated and stabilized. That process that I'm describing to you unfolded over several hours and we got information slowly throughout the night that devastating information that three of those miners had died. I think at least one of them was in the hospital at the time, two maybe. Or were en route to the hospital at the time.

MARCIANO: Dr. Sanjay Gupta, thank you.

GUPTA: Thank you.

CHETRY: The other big story this morning. Rescue workers in Peru searching for survivors after the strongest earthquake to hit the country in 35 years struck yesterday. The government says more than 500 people were killed and more than 1600 hurt. The U.S. geological survey upgraded yesterday's quake. They are now calling it a rare 8.0.

Hurricane Dean picking up steam as it heads for the Caribbean. Islands are bracing for as much as ten inches of rain this morning which could trigger mud slides in mountain areas. It is the first hurricane of the 2007 season in the Atlantic and forecasters say it could be devastating. Right now it's considered a category two storm but it is expected to become a major category four by the time it hits Jamaica over the weekend.

Well the one thing Texas didn't need and could not handle it got yesterday. Rain and lots of it. All from the remnants of tropical storm and then tropical depression Erin. The city of Houston was hardest hit. It was already a foot above average rainfall for the year. As much as eight inches of rain in a matter of hours. 70 people had to be rescued from the high waters as cars floated away. Police say one person was killed when a grocery store's roof came down.

It's not the water but the heat that's taking the lives in the Midwest and the southern part of our nation. Ten days of excruciating heat leaving at least 37 people dead. The mercury topped out at a record 105 degrees in Memphis, Tennessee. Eight people have died in that city so far. Doctors say the biggest problem they're seeing is dehydration.

MARCIANO: Boost for the markets. Tops are quick hits right now.

The Fed has just cut the discount lending rate by half a point. U.S. futures markets have rallied in response.

And an update on story we've been closely following this week. Workers in China losing their jobs after recall of millions of toys made there. The China Toy Association says the problems were not deliberate.

And coming up, one-on-one with Senator John McCain, weighing in on his GOP competitors. More of Kiran's interview with him when we come back.

(BEGIN VIDEOTAPE)

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(END VIDEOTAPE)

(COMMERCIAL BREAK)

MARCIANO: Want to get right back to Ali Velshi. He's been following the fed move cutting the discount rate by half a point. What is going on now Ali?

ALI VELSHI, CNN CORRESPONDENT: All right. Well, we're following this closely. Dow futures are up 201 points. This could indicate an opening on the Dow between 200 and 300 points. The fed discount window. This is not the fed rate we talk about. The fed did not cut that. This remains 5.25 percent which means your loans connected to prime rate is still 8 1/4.

The Fed discount window is for banks money that need to get money and can't seem to borrow them at good rates from each other. It's for money that can't flow in the system, banks can go right to the federal reserve and borrow money overnight in a crisis, in an emergency. Now for 5.75 percent. That rate up to 6.25 percent. This is part of what this crisis has been.

Banks have been worried about money, investors have been going to the banks and investment houses and pulling our their investments and there's been some fear they may not be able to pay that out. The fed is saying they can go to the federal reserve for 5.75 percent and borrow money on overnight basis.

There's also some word that that money can be borrowed for more than just overnight maybe for a month and maybe renewed. This is a bigger injection of liquidity into the system than we've seen before. This is the fed making a bigger move to rescue this situation than we've seen before and the effect is dramatic.

We've moved from about 149 points lower on Dow futures to almost 200 points higher, 201 points higher. European market which were all in negative territory have rallied on this news. This could be the news that the market needed to turn around. One thing we know for sure in 45 minutes when the opening bell rings at the New York Stock Exchange it's going to be in the green.

Rob, I'll keep you posted as this develops.

MARCIANO: Finally, some good news from you.

VELSHI: Yes.

MARCIANO: Thank you.

What is coming up this weekend on CNN? Let's go to T.J. Holmes in Atlanta with a preview. Good morning, T.J.

T.J. HOLMES, CNN CORRESPONDENT: Good morning there, kind sir.

What have we got this weekend, an emotional interview with the founder of the legendary OJs. He lost his son and singing partner to a heart attack less than a year ago.

(BEGIN VIDEO CLIP)

EDDIE LEVERT: This was something I could of lived without. I could of done without this.

(END VIDEO CLIP)

HOLMES: Story about father, sons and families the topic of the best-selling book "I got your back." Eddie Levert talks about it this Sunday morning.

Also this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I think they would send us information before they announced to the world that these toys are no good.

(END VIDEO CLIP)

HOLMES: From store owners to parents, the frustration surrounding this week's toy recall. We'll tell you how you can take action by signing an online petition.

And they say they are Catholics who speak Aramaic. They are being persecuted in their own countries so these Iraqis take the risk to get to America illegally. This challenging story is in our Faces of Faith.

We will be keeping track of all this crazy weather we've been seeing, including Hurricane Dean. That's all this weekend on CNN Saturday and Sunday morning. That starts tomorrow at 7:00 a.m. Eastern.

Back to you Rob.

MARCIANO: Is Betty back from her trip or do you have another guest host?

HOLMES: I have a special guest. We should make it a surprise guest but no, Brianna Keilar is going to be with me tomorrow. Always a good time with her. She is going to be helping us out. Betty is still over in Africa doing some good work.

MARCIANO: All right. We'll look forward to that. Thank you.

CHETRY: All right. In a moment it's time for our ballot jackpot. Our political panel weighing in on the hot topics of the week. What hot topics are in here? You'll have as to stick around to find out.

MARCIANO: Lots of topics. We'll be right back.

(COMMERCIAL BREAK)

MARCIANO: "CNN NEWSROOM" is just minutes away. Heidi Collins is at the CNN center in Atlanta with a look what is ahead.

Good morning, Heidi.

HEIDI COLLINS, CNN ANCHOR: Hi there, Rob.

Utah mine disaster on the rundown this morning. Of course, three rescuers killed in a new cave-in. Several others seriously hurt. Will the search for six trapped miners go on? An answer is likely today.

NFL quarterback Michael Vick minutes away from a prosecutor's deadline. Will he take a reported plea deal on dog fighting charges?

It is still raining in Texas. Parts of the state under water. Erin dumps tremendous amounts of rain. Any breaking news when it happens right here in the NEWSROOM at the top of the hour on CNN -- Rob.

MARCIANO: See you in about ten minutes. Thanks, Heidi.

COLLINS: OK.

CHETRY: Well, we're talking about Senator John McCain. He was once considered the man to beat among the republic pack running for the White House but the senator's campaign has suffered more than a few setbacks, many of them well publicized. I had a chance to talk with him last night about what went wrong and what may be ahead for his campaign and what he thinks about his competition.

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CHETRY: You talk about the ups and downs of campaigns and your downs were highly publicized. You had the departure of some long time people. You ran out of money. What went wrong?

SEN. JOHN MCCAIN (R), ARIZONA: Bad decisions, budget decisions on my part. It's all my responsibility. We're back on track again. Every campaign has problems from time to time, but I'm very happy with where we are now and how we're doing. I think most Americans will start deciding sometime in September or October as to who they want to support and I am confident in my ability to do the kind of campaigning that will gain their support, recognizing that it's very tough.

CHETRY: You said earlier this week that since 1980, every nominee has won two of the three key early races that being New Hampshire, Iowa or South Carolina. You're not leading in any of these states. If you were not to win one of those two states would you consider dropping out?

MCCAIN: I am sure we would have to see what the circumstances were at the time but I'm confident we will win two of the three early states but I would imagine it would be extremely difficult without that. You'd be defying history.

CHETRY: When it comes to Rudy Giuliani as well he was the only one on the stage that was willing to say that he was pro choice. I mean, after really getting questioned. Do you think that a pro choice candidate can win the GOP ticket?

MCCAIN: I think it's very difficult. I think it's very difficult, because it's one of the principles of our party. But he seems to be doing pretty well so far.

(END VIDEO CLIP)

CHETRY: All right. So that was John McCain weighing in about Rudy Giuliani saying it is difficult to be the only pro choice candidate in the GOP field. Giuliani still leading the national polls, though. That's where we start our Friday edition of political hot topics. We call it jackpot or ballot jackpot and we have put one hot topic on each ballot. We've stuffed the box and then we draw them out one at a time. Our guests have to weigh in. Although I will admit today that we cheated a little bit.

MARCIANO: Of course, we did. We cheated the last time I was here as well but nonetheless it's going to be informative and hopefully it will be entertaining thanks to our panel that's joining us once again, democratic strategist, Kelly Bangle, she's in New York, and republican strategist, Terry Holt, in Washington.

Good morning to both of you. Are you ready for what we rigged here?

KELLY BANGLE, DEMOCRATIC STRATEGIST: Let's do it.

TERRY HOLT, REPUBLICAN STRATEGIST: Only if you admit you're cheating up front so bring it on.

MARCIANO: I was a boy scout so I admit that.

CHETRY: Coming on the heels of our discussion with John McCain. I'm interested to get both of your opinions. We start with you, Terry. McCain comeback. Is it in the works? Is it possible?

HOLT: I think it's very possible. This is a guy who is used to running as an underdog. He's articulate and has the leadership qualities that republicans are looking for. But he's got an awful long road. His campaign suffered some tremendous losses, I think, over the last few months. But, hey, we still got a lot of time left. Rudy Giuliani and Mitt Romney would like, I think, this to be a two- person race but I think they still hear footsteps. Whether it's Thompson's or McCain's, we'll have to see.

BANGLE: I pretty much agree with everything Terry said. I think McCain ran a good campaign the last time around and I think he has a lot to offer voters. We'll just have to see. But I don't think it's a three-person race in the Republican Party just yet. Nobody within the Republican Party has really attracted the base and emerged at a front runner so I agree with most of what Terry says.

HOLT: One thing we do know is Mr. McCain is a fighter. We dip back into the box here. Better late than never? We put that. Kiran, explain.

MARCIANO: All right. We dip into the box here. Better late then never?

CHETRY: We're talking about Fred Thompson. Is running number two in our CNN poll but hasn't announced. Some are saying what are you waiting for and he is saying it's never too late.

HOLT: It may not be. But I think in the early states, your interview, you mentioned you have to win one of these early states or that's been the tradition. I think that holds. Two or three of these things are big momentum builders and I think that if Thompson wants to compete in one of those early states, time is running out.

MARCIANO: He's going to be at the Iowa state fair so is that softening up to maybe appeal to the democrats down the line?

BANGLE: Absolutely. I think if Thompson gets in the race will do very well in South Carolina. I think most folks in the south would love to see a southerner get in the race so I think has a strong chance in South Carolina and certainly Iowa where he can appeal to the rural base in that accent.

MARCIANO: You're just saying that because you have that accent.

CHETRY: Ellen and Tyra. This is an interesting one. It seems that day time talk shows may be the more popular route to go. We saw how late night had an impact but we have Hillary Clinton getting ready to be on Ellen's show and Barack Obama expected to be the Tyra's guest. Untapped medium, Kelly?

BANGLE: Absolutely. This is an indication that candidates are recognizing women are key to this election and certainly the viewership of both shows is predominantly women and trying to talk to those voters and talk to them in a meeting that will get their attention so I think that's very smart.

CHETRY: Terry, let's let Rob pull another one for you.

MARCIANO: One more quick one. Even though I think Terry had something to say about that last one. Edwards asks Obama for help.

CHETRY: For getting lobbyist influence out of Washington. What is going on here what Edwards said to Obama? HOLT: What about me? Don't make this a two-person race. On the democratic side I think it really has shaped up to a race between Obama and Clinton. And in this case, I think Edwards, short of cash. You know he had to pull some resource out of Nevada earlier this week to focus on Iowa and the other early states. He's just hoping that this doesn't become a two-person race and this is a cry for help at this point.

MARCIANO: Terry Holt, do we have time for Kelly's response real quick? Ten seconds there.

BANGLE: I think Terry would agree with me we're both lobbyists and say we won't take your money and help your children's 529 accounts so I'm all for it. I hope they all say it.

MARCIANO: Thank you both for joining us. Have a great weekend.

HOLT: Thank you.

BANGLE: Thank you.

CHETRY: We are back in a moment.

(COMMERCIAL BREAK)

CHETRY: Thanks for joining us this week on AMERICAN MORNING. We loved having you. Come back any time.

MARCIANO: My honor to be here. Y'all have a great weekend. The "CNN NEWSROOM" with Heidi Collins begins right now.

HEIDI COLLINS, CNN ANCHOR: I'm Heidi Collins. Tony Harris is off today. Watch events come into the NEWSROOM live on August 17th.

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