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American Morning
Asian Markets Rally; Obama Wants Jolt in the Ailing Economy; How the Bailout is Being Spent; Michelle Obama Making a Mark; Paulson Praises Geithner; Struggling Families Dumping Pets; Inaugural Security: Secret Service Plans for the Worst
Aired November 25, 2008 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
KIRAN CHETRY, CNN ANCHOR (voice-over): Money in the bank. Another bailout kick-starts Wall Street and the president-elect promises a powerful, historic, job-saving economic jolt.
BARACK OBAMA (D), PRESIDENT-ELECT: We do not have a minute to waste.
CHETRY: Plus, a dog eat dog economy.
UNIDENTIFIED FEMALE: Their families can't afford to take care of them, buy them food, take them to the vet.
CHETRY: Puppies and kittens and goats? When people get kicked to the curb, what happens to the family pet on this AMERICAN MORNING?
(END VIDEO CLIP)
CHETRY: And welcome. Glad you're with us on this Tuesday, November 25th. I'm Kiran Chetry. And once again we have Joe Johns with us. Welcome. Glad you're here.
JOE JOHNS, CNN CO-ANCHOR: I'm having a great time.
CHETRY: On a good note, right?
JOHNS: Absolutely. Holiday week. Who can complain?
CHETRY: Exactly.
JOHNS: We begin with breaking news about your money. What a difference a day makes. As we speak, markets overseas are reacting to Wall Street's nearly 400-point rally.
In Europe, the major indexes are mixed. But in Asia, the markets soared. Japan's Nikkei closed up more than five percent. Hong Kong closed up more than three percent. The market's climb was lifted up by the U.S. government's plan to bail out Citigroup and the announcement of Barack Obama's new economic team.
It will be a whole lot cheaper getting home for thanksgiving. Gas prices are down for the 69th straight day. According to AAA, the national average for a gallon of regular is now $1.89, down almost two cents overnight. The last time we've seen gas prices this cheap, February of 2005.
And international shippers are calling for a military blockade along the coast of Somalia to intercept pirate ships heading out to sea. They say stronger naval action is needed to combat the rampant piracy in the Gulf of Aden. NATO has rejected a blockade. Somali pirates have become increasingly brazen seizing eight vessels in the past two weeks, including a Saudi super tanker loaded with $100 million worth of crude oil.
CHETRY: And we begin with breaking news and markets in Asia up sharply. The confidence coming after the Dow soared nearly 400 points on top of another 500-point gain. It's the biggest two-day gain in 21 years. The market's climb was fueled by news of a $20 billion rescue for Citigroup, and there may be more relief for Wall Street today with the treasury set to unveil its latest plan to jump start the credit market.
There's some big decisions happening regarding your money, and the president making a point of saying that he is keeping the president-elect informed.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I talked to President-elect Obama about the decision we made. I told the American people, and I told the president-elect when I first met him that any time we were to make a big decision during this transition, he will be informed as well as changes.
(END VIDEO CLIP)
CHETRY: And Christine Romans is here "Minding Your Business" this morning with more on this. It's hard to get excited about it because we have seen this volatility before where after a big bruising we see a jump.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: A big jump, two big jumps. I mean, listen to my voice. I mean, so much is going on.
CHETRY: Did you lose your voice cheering on the market yesterday?
ROMANS: I know. It's almost as if I was screaming all afternoon, right? No, two big days in a row now, and this is the biggest two-day bounce for the Dow percentage wise since 1987, point wise (ph) ever. So it's a little more than just the average snap back rally. It was a very big powerful rally.
Three things going on here. The Geithner bounces, they're calling it. You know, Timothy Geithner will be the new treasury secretary, and he is somebody who's already been in there right now working on the bailouts. So there's this feeling that there's no transition paralysis. There's somebody in there right now who's going to be at the helm of the president-elect, Obama's new team. And so a lot of people on Wall Street like that. He's also well respected. He is seen as a good policymaker, and he's a good balance to Larry Summers who will be sort of directing strategy. Larry Summers who can be very brash but also very brilliant. So a good pairing there.
A lot of people are saying this huge Obama stimulus plan, the president talking about jolting the economy back with hundreds of billions of dollars of spending. Even the people who are worried about deficits are agreeing that this is something that has to be done in the near term because the alternative not spending a lot of money, the alternative would be much worse for the economy, would cost us more in the long run.
So a quick reminder, how do we get the money? Well, taxpayers could get the money. How do taxpayers get the money? We don't have it so we borrow it. So just remember, I mean, with some longer term issues to deal with the very near term, we're talking about stimulus in the form of infrastructure spending, in the form of some other social programs that right now Wall Street seem to like.
There's the Citi bailout. It's the idea that, you know, the government is not going to let these big banks go down and that is part of repairing the infrastructure. And then later today, we're going to hear from the secretary of the treasury, Henry Paulson, who's going to have a press conference at 10:00 a.m. Eastern time, you guys. And he is expected to talk more about consumer lending and some of these things that he's hinted, that other programs he's hinted at before. He keep pointing out, there's more money to spend. Whether he leaves it all on the table for the next president, we'll have to see what he says earlier today.
CHETRY: All right. Christine, thanks.
ROMANS: Sure.
JOHNS: Fifty-six days now until President Barack Obama takes office, and reviving the economy remains his top priority. Obama is expected to announce another key appointment at a news conference today just one day after unveiling the captains of his economic team.
New York Federal Reserve Chief Timothy Geithner, nominated treasury secretary, and Larry Summers will head the National Economic Council. Obama says his mission is to stimulate the economy and create millions of jobs, but he's giving few details of the stimulus plan he wants from Congress, except to say there's no time to waste.
(BEGIN VIDEO CLIP)
BARACK OBAMA (D), PRESIDENT-ELECT: It is my hope that the new Congress will begin work on an aggressive economic recovery plan when they convene in early January so that our administration can hit the ground running.
(END VIDEO CLIP)
JOHNS: CNN's Suzanne Malveaux is live for us in Washington. And, Suzanne, Obama certainly has been very visible but we have yet to hear some real specifics on his economic plan. When do you think that's going to happen?
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: You know, it's interesting, Joe, because Obama said that his economic team would start today in crafting this recovery plan. We don't expect a lot of details on it for some weeks, but we do know what is central to Obama's plan.
First and foremost, he says a huge economic stimulus package. It has to be passed by Congress but he wants it to jump start the economy, he believes, to create 2.5 million jobs in the next two years.
Secondly, a plan to figure out how to best allocate the rest of the $700 billion bailout to shore up those markets.
Third, a way to start cutting the budget where there is some wasteful spending. All those three things he thinks at least in the very beginning in the short term will produce some sort of immediate jump start, immediate results, Joe.
JOHNS: So we do have this news conference today. What are we expecting? What new names do you think we're going to hear?
MALVEAUX: Well, we heard some pretty powerful names yesterday. Today, Peter Orszag is going to be named director of Office of Management and Budget. He is the head of the Congressional Budget Office. He is another one who comes out of the Clinton White House. Also, New Mexico Governor Bill Richardson, another former rival that's turned friend, is expected to be named commerce secretary either today or in the days ahead.
But what's really important in looking at these appointments, Joe, there's some key themes that are emerging. One is the need for consistency, that's why you've got Tim Geithner as the treasury secretary. As New York Fed chair, he was intimately involved in that $700 billion bailout plan. He's a link really between what's happening in the Bush administration and what's going to take place in the Obama administration.
Another thing that Obama talked about a theme is accountability. Yesterday, he slammed the three big automakers for not having a plan to get themselves out of their own financial mess when they approached Congress last week for money. So accountability and consistency -- Joe.
JOHNS: And we'll be watching right here on CNN. Suzanne Malveaux in Washington, thanks much.
And President-elect Obama says Congress did the right thing by telling Detroit's big three automakers they need to come up with a clear plan before getting any bailout money.
(BEGIN VIDEO CLIP) BARACK OBAMA (D), PRESIDENT-ELECT: We can't just write a blank check to the auto industry. Taxpayers can't be expected to pony up more money for an auto industry that has been resistant to change.
(END VIDEO CLIP)
JOHNS: Obama says he was surprised auto executives didn't prepare a better blueprint before making their pitch to lawmakers last week.
And you can watch the coverage of Barack Obama's second news conference on CNN and CNN.com starting at noon Eastern time -- Kiran.
CHETRY: Joe, thanks.
Well, the election may be over but there's a new batch of political ads praising the former GOP vice presidential nominee, Sarah Palin. They're now hitting the airwaves. Now these spots are paid for by a conservative political action committee thanking Palin for her conservative values and service.
These ads can already be seen in Alaska. They'll be airing nationwide this coming week.
Well, a big legal victory for Facebook. A federal judge awarding the social networking site $873 million in damages against a Canadian man accused of illegal spamming. Facebook claims that he gained access to the passwords of its users then bombarded them with millions of messages about sexual products and drugs. It's by far the largest award to date under a 2003 law passed to combat illegal spamming.
And the nation's obsession with reality TV is giving rise to a new paranoia. Researchers are now documenting what they termed Truman syndrome. It's named after the 1998 show, movie, of course, "The Truman Show" where Jim Carrey is the character. A man finds himself that his life is really just a phony stage set and he is the star as other people watched.
Psychiatrists say that delusional patients are convinced that their lives are being played out before an audience. For instance, they say, one man was convinced that his every move was being filmed for a TV contest. How about that? They say it's a fact that we have so many reality TV shows that it's actually turning into a psychiatric condition for people.
JOHNS: That's true. But I sort of feel like I'm on TV right now. I don't know about you.
CHETRY: Yes. This is the living Truman show.
JOHNS: Right.
CHETRY: Isn't it?
JOHNS: It could be (INAUDIBLE). First, Wall Street wanted some. Now bankers and automakers are asking for some of that $700 billion bailout. So how exactly is the government going to use your tax dollars? We're following the money trail.
And Michelle Obama is about to become the country's first African-American first lady. A look at how Mrs. Obama will be making her mark on history.
It's nine minutes after the hour.
(COMMERCIAL BREAK)
EUNICE YOON, CNN CORRESPONDENT: Welcome back to the "Most News in the Morning." I'm Eunice Yoon in Hong Kong.
Markets in Asia breathe a sigh of relief after the U.S. government decided to bail out Citigroup. People here say the move helped to avert another system crisis in the financial sector.
International investors are also optimistic about President-elect Obama's choice for treasury secretary. They say Timothy Geithner is best positioned to help guide the U.S. and global economy because of his experience at the Fed, with Wall Street firms and overseas -- Kiran, Joe.
CHETRY: All right. Thanks.
Well, the government's sweeping $20 billion plan to keep Citigroup afloat is just the latest chunk of the $700 billion bailout that we've been hearing a lot about. Money that was originally set aside for Wall Street now automakers, even mayors in cities are asking for a piece of this pie. And technically, it's your money and you have a right to know where it's going.
So here's CNN's Tom Foreman.
TOM FOREMAN, CNN CORRESPONDENT: Joe, Kiran, when the $700 billion Troubled Asset Relief Program or TARP was launched last month, it quickly came under fire because it was sold as one thing but then became another.
(BEGIN VIDEOTAPE)
FOREMAN (voice-over): Gone was the promise to buy up bad mortgages. Instead, the Treasury Department had a new plan. Pump money into lending institutions holding those bad loans.
Nine big name lenders were first in line, including Bank of America for $15 billion, Citigroup, 25 billion, Goldman Sachs 10 billion. On it goes. And officials have defended the strategy.
HENRY PAULSON, TREASURY SECRETARY: My focus is really on the financial system stability getting credit flowing again, because that's going to be the key. FOREMAN: So far, $310 billion has been committed this way including that latest money for AIG and Citigroup. Hundreds of banks are now involved, and stability is improving. Banks are now charging each other less to borrow money. Some stronger banks are buying up weaker ones.
Officials say in coming months more consumers and small businesses should find loans easier to come by. But many economic analysts argue that the big banks are not being pushed nearly enough to help consumers sooner. There's still not enough oversight and until those bad mortgages are dealt with, private investors will remain wary.
At Moody's, Mark Zandi.
MARK ZANDI, MOODY'S ECONOMY: Bottom line, we got a lot of bad loans and bad securities and we don't know what they're worth. Until we do, no one's going to provide capital to the banking system and without that capital, the banking system isn't going to function properly and neither is the economy.
(END VIDEOTAPE)
FOREMAN: Nevertheless, the Treasury Department is now talking about extending this loan help to companies that deal in student loans or auto loans or maybe credit card debt. If that is to happen, however, Congress will have to re-approve spending the second half of the $700 billion and that could be a hard sell if too many consumers go through the holidays not already feeling like this bailout is working for them -- Kiran, Joe.
JOHNS: Michelle Obama is breaking the mold and not just in Washington as the first African-American first lady. She may change how black women are seen and how they see themselves.
And pet surrender. More and more struggling families that can't make ends meet are dumping their dogs and cats. But there's hope ahead for the animals.
It's 15 minutes past the hour.
(COMMERCIAL BREAK)
JOHNS: Welcome back to the "Most News in the Morning." Barack Obama isn't the only one people will be looking to for change come January. Expectations are building around the new first lady as well.
CNN's Randi Kaye looks at the pressure that will follow Michelle Obama to 1600 Pennsylvania Avenue.
RANDI KAYE, CNN CORRESPONDENT: Good morning, Joe and Kiran. She's a high-powered professional, successful and the wife of the president-elect. Three good reasons why Michelle Obama may change the image of black women.
(BEGIN VIDEOTAPE) ALLISON SAMUELS, "NEWSWEEK": When you look at television, we're either, you know, single mothers with a bunch of children or drug addicts or street walkers.
KAYE (voice-over): Allison Samuels wrote this article for "Newsweek." She hopes and expects having Michelle Obama in the White House will help put an end to the stereotyping of African-American woman, often portrayed as overweight, ignorant and angry.
SAMUELS: We still have that negative image of black women being overweight and very loud, and rolling their eyes and talking back and having these sassy one-liners all the time. And that's just not the entire community.
KAYE (on camera): During the campaign, Mrs. Obama was the victim of stereotyping too. A television anchor, not from this network, referred to her as Barack Obama's baby mama, a slang term often used to describe black women who have children out of wedlock. The anchor later apologized.
(voice-over): Mrs. Obama is a Harvard-educated lawyer who earned a six-figure salary before leaving her job to help her husband's campaign. With about 30 percent of African-American children being raised in poverty, that may register with black women.
OLIVIA FISHKIN, NEW YORK RESIDENT: The average African-American young woman should take heed and hope that with hard work and study that they can also elevate themselves and to aspire to become whatever they want to become.
KAYE: What about her skin color? It's much darker than African- American celebrities like Beyonce or Halle Berry. Samuels say that may send the message that black is beautiful.
SAMUELS: In the African-American community, a lot of times beauty is sort of determined by how light you are. And what I love about Michelle is that she's not that typical look.
KAYE: Michelle Obama's physique may also light a fire under black women. Federal statistics show four out of five African- American women are overweight or obese. Mrs. Obama works out daily, often before her girls are even awake.
SAMUELS: I think all of that is going to play a big role in African-American women. You know, just sort of taking a step back and saying, what can I do to be healthy?
(END VIDEOTAPE)
KAYE: So while Mrs. Obama may be focused on becoming mom in chief as she likes to say, her role may be far greater than she will ever know -- Joe, Kiran.
CHETRY: Randi Kaye for us, thanks.
Well, keeping Barack Obama safe on inauguration day. We're going to be taking a look at some of the worse case scenarios that Secret Service is prepping for to make sure this historic event goes down without any disasters.
And one bailout wasn't enough for Citigroup. It may not be enough now for other big banks. But could this financial lifelines be putting the U.S. economy at risk long term? Some answers after the break.
It's 21 minutes after the hour.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP, "THE TONIGHT SHOW WITH JAY LENO")
JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": I mean, blue collar guys who make our cars, they don't get the bailout. But the white collar guys in Wall Street, they get the bailout.
You know I think we should do? I think they should work together. I think the guys in Detroit should keep making the cars, and the guys in Wall Street should be making the license plates. You know what I'm saying.
(END VIDEO CLIP)
CHETRY: That was Jay Leno there weighing in on the bailout solution. The government's rescue of Citigroup helped spark the biggest two-day advance on Wall Street since October of 1987. But is there still danger ahead? I think many of us agree there is but really what do we do about it at this point?
Joining us is Farnoosh Torabi. She is a senior correspondent for Thestreet.com. Thanks for being with us this morning.
FARNOOSH TORABI, SR. CORRESPONDENT, THESTREET.COM: Sure.
CHETRY: So we did see a jump, as we said the biggest two-day rally in decades after the Citigroup bailout plan was announced. Is that just a blip on the screen or are we looking to more stabilization because of this?
TORABI: I think a little bit of both. I think yesterday was clearly evidence that there's a lot of support behind this bailout not just domestically but also Asian markets were seen piggybacking on our rally from yesterday.
Also, this also clears the air a little bit. You know, we have a resurgence of confidence. What this market lacks for the most part is clarity and transparency and now -- and also we felt like after TARP what's going to happen? Once that expired is the government just going to wait on the sidelines? No. Apparently, they're going to step in and help ailing banks.
And I don't think this is the end of the worse for Citigroup. I think we're going to see more banks getting in line, including Citigroup. CHETRY: One of the biggest problems, right, is that people aren't lending money?
TORABI: Right.
CHETRY: That the credit markets didn't loosen despite these enormous sums of money being injected into the banks. So will this change that?
TORABI: Well, that's a really good question. This is a little more structure I think than the handouts, literally the handouts that were given earlier. Remember, Citigroup already got $25 billion.
CHETRY: Right.
TORABI: And that really didn't help. And now they're getting $20 billion but in exchange the government is getting preferred stock plus an eight percent dividend. I don't know any financial instrument that's reaping that kind of a game. Furthermore, there are provisions with this.
The government is saying we're going to give you this money provided that you agree to the FDIC loan provision, loan modification plan, provided that you stop your dividends effectively, and provided that if you're going to give any kind of executive compensation we need to know about it and we need to give it the green light. Probably we won't, but there seems to be a lot more cooperation between how the bank is now going to utilize this cash and the government's involvement.
CHETRY: You know, we kept hearing yesterday two things. Crisis of confidence.
TORABI: Right.
CHETRY: And also that Citi was too big to fail. They also said that about AIG. There's a reverse argument for that if you will that I thought was interesting from "The Washington Post." It said that "the rationale for saving Citi is that with $2 trillion in assets, more than 300,000 employees, operations in 100 countries, this was a bank that was too big, too interconnected with the rest of the financial system to be allowed to fail."
The question now, however, is whether an institution of that size and scope is also too big to succeed. That was from Steven Pearlstein. What do you make of that argument?
TORABI: I think there's a lot of merit to that argument. And on thestreet.com, there's a -- we have a big front cover story about where is Citi going to be in the future? What is the future of Citigroup?
Right now, it's a mega highway, a banking highway where it's appealing to consumers and corporations. But that plan is not really working and it has not just worked in the past few weeks or the past few months, this is years of pressure for Citigroup to figure out a new strategy.
And Vikram Pandit, the CEO, has announced that he wants to make changes at Citigroup. So I think where the roads diverge now is whether Citigroup is going to continue to please just you and I consumers, or to please corporations, because right now, that model of doing everything under one roof is just not working.
CHETRY: The other thing a lot of people don't understand is why is it so quick to turn around? And why is it that our government is so quick to give billions to these banks?
TORABI: Right.
CHETRY: And I understand the importance of the credit markets in the banks and not to the auto industry.
TORABI: Right. The auto industry feels sort of like the ugly step child right now but I think because the priority right now is to thaw the credit market. And what controls the credit market is the financial industry. So that's really the -- there's the hierarchy of who gets help. You know, I think that it's banks and then everything else. And I think the government hasn't said absolutely no to the automakers. They said go back, think about exactly how you want to restructure yourselves and then we'll come back to the table and talk about it again.
CHETRY: All right. Maybe they should do that with the banks as well.
TORABI: Yes.
CHETRY: Maybe it wouldn't be this messy.
Farnoosh Torabi, thanks so much for joining us this morning.
TORABI: Sure.
CHETRY: Joe?
JOHNS: Just about 30 minutes past the hour. Here's a check of the top stories.
Seventy-two new vehicles received top safety marks from the Insurance Institute for Highway Safety. Ford led the pack with 16 of its cars and trucks performing well in protecting people in front, side and rear crash tests. Honda had 13 vehicles in the top rated group. Chrysler was the only major automaker that did not make the list.
A federal judge has dismissed three counts in the indictment against former baseball star Barry Bonds. But the bulk of the government's perjury case remains intact. Bonds is accused of lying to a grand jury about his use of performance-enhancing drugs. Baseball's reigning home run king is scheduled to stand trial in March. And more than a dozen felons can thank the president this thanksgiving. President Bush granted 14 pardons Monday for people convicted of a variety of crimes including tax evasion, bank embezzlement and drug offenses. Mr. Bush also commuted the prison's sentences of two others.
President-elect Barack Obama is making America's teetering economy issue number one. Today, he will introduce the newest member of his economic team to deal with the crisis. It comes one day after Obama introduced his top money advisers. And while not officially on the job, Obama says he and his team are on the case, though he's taking pains not to raise expectations.
(BEGIN VIDEO CLIP)
BARACK OBAMA (D), PRESIDENT-ELECT: This will not be easy. There are no short cuts or quick fixes to this crisis, which has been many years in the making and the economy is likely to get worse before it gets better. Full recovery will not happen immediately. And to make the investments we need, we'll have to scour our federal budget, line by line, and make meaningful cuts and sacrifices as well.
(END VIDEO CLIP)
JOHNS: And Timothy Geithner is the man leading the effort to turn things around. CNN's Allan Chernoff joins me now with more on the man who will be the next Treasury secretary.
ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: Good morning, Joe. And he is turning out to be a very popular pick. Now part of that is because of Geithner's record. It's a very strong record. But part of it is also because of the performance of the current economic team.
(BEGIN VIDEOTAPE)
CHERNOFF (voice-over): At a time of economic crisis, President- elect Obama's pick of Timothy Geithner to be Treasury secretary is highly celebrated.
PROF. JEFF FRANKEL, HARVARD UNIVERSITY ECONOMIST: Tim Geithner is the right guy. I mean, he has long experience with dealing with financial crises.
CHERNOFF: Investors had been frustrated with current Treasury secretary Henry Paulson's flip-flopping through the financial crisis. Paulson lobbied hard for Treasury to gain $700 billion to buy troubled mortgages from bank, then abandoned the plan. That accelerated the crisis facing Citigroup, a major owner of mortgages, and helped force Monday's bailout of the bank. Geithner, economists say, should know better than to cause such uncertainty for the financial markets.
AMITY SHLAES, COUNCIL ON FOREIGN RELATIONS: Secretary Paulson was -- was making it up as he went along, but wasn't very clear about the rules.
CHERNOFF: Another contrast: Paulson spent his career at Goldman Sachs, rising to chief executive. Geithner has no allegiance to any Wall Street firm. He's a product of the Treasury Department, where he spent years handling financial crises around the globe.
Even Secretary Paulson expressed admiration of Geithner saying today, "I have great confidence in his understanding of markets, his judgment, and leadership."
(END VIDEOTAPE)
CHERNOFF: We should note that Geithner has been a key consultant in the various bailout plan, but come January he'll be the man on the Treasury hot seat not Mr. Paulson.
JOHNS: So, Allan, what is it that the markets really want to see here?
CHERNOFF: I think there's a lot of frustration in the financial markets and in the financial world that there has been some inconsistencies here. I mean, one minute the Treasury says we're buying these mortgage back securities that have been weighing down the banks, and then all of a sudden they pull the rug out. And they say, no, that's not happening. Geithner needs to be consistent, and I think he's seen what's happened over the past few months. That's a lesson he'll take with him to Treasury.
JOHNS: Allan Chernoff, thanks. Good to see you.
CHETRY: Kicked out.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Their families can't afford to take care of them. They can't afford to buy them food. They can't afford to take them to the vet.
(END VIDEO CLIP)
CHETRY: The economy hits really close to home. A look at how tough times are overwhelming the local animal shelter. You're watching the "Most News in the Morning."
(COMMERCIAL BREAK)
CHETRY: Welcome back to the "Most News in the Morning." You know, another innocent group taking a hit in the bad economy, the family pet. Because oftentimes when the family struggles, the dog or the cat is the first one kicked to the curb. And as John Zarrella reports, many animal shelters are now in crisis mode.
JOHN ZARRELLA, CNN CORRESPONDENT: Joe, Kiran, this is Mandy. Mandy is 5 months old. Not long ago, she had a good home. Now her home is here at the Humane Society of Broward County. Agency officials say it's scary, the number of pets whose owners can no longer afford them because of the economy.
(BEGIN VIDEOTAPE) ZARRELLA (voice-over): Take a look at the faces, the wagging tails. Each one of them seems to beg. Can you take me home? There's Spot, Bentley, Diamond, Bella, Tinkerbelle the Cat. They're all here at the Humane Society of Broward County for the same reason, they were turned in by their owners.
CHERIE WACHTER, HUMANE SOCIETY OF FORT LAUDERDALE: Their families can't afford to take care of them. They can't afford to buy them food. They can't afford to take them to the vet.
ZARRELLA: Cherie Wachter has been with the Humane Society for 13 years.
WACHTER: Wait, are you going to crawl on my lap. I know.
ZARRELLA: It's never been this bad. Adoptions for the year are down here by 500. Cash donations way down. Nationwide, the Humane Society says pet surrenders are up more than 30 percent.
This shelter in suburban Atlanta for instance had seen a 10 fold increase in pet abandonment during the past two years. And not just dogs and cats. Look at this. A farmer had to give up his goats. At least these owners thought enough of their pets to turn them in.
SHERRY MARTS, ANIMAL CONTROL SPECIALIST: Oh, that's it. Right there. And look at the dog laying there.
ZARRELLA: Sherry Marts with Miami-Dade Animal Services rarely saw animals left behind to fend for themselves. Now, it's all the time.
MARTS: People call because people that live next door to them either got evicted or they couldn't, they had to move but they couldn't take their animal so they leave them behind.
ZARRELLA: Two dogs were left behind at this foreclosed home. One takes off when it sees Marts. The other plays a doggie version of cat and mouse, eventually his luck runs out.
MARTS: Got him!
ZARRELLA: Now he goes to the shelter. If he gets lucky, he gets adopted, a new home and a second chance.
(END VIDEOTAPE)
ZARRELLA: The holidays are usually the biggest time for animal adoption, but the Humane Society is not sure what to expect this year. Right now that old saying, it's a dog's life just doesn't carry quite the same meaning.
Joe?
Kiran?
JOHNS: I couldn't imagine leaving my pooch like more than two or three nights at the pet hotel.
CHETRY: You got to -- you got to just think what dire straits these people must be in to do that. It's so sad. I would adopt them all if I could.
JOHNS: Yes, it's really sad.
CHETRY: All right. Well, it's 38 minutes after the hour.
JOHNS: In search of aliens.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I remain convinced that it is still a cover up of ignorance.
(END VIDEO CLIP)
JOHNS: Beyond the tourist trap. Miles O'Brien digs up the real story behind the Roswell incident. You're watching the "Most News in the Morning."
(COMMERCIAL BREAK)
CHETRY: He is the rocket man. How about it? Real life rocket man soaring across Colorado's Royal Gorge. No parachute. No safety net. Just 800 pounds of horsepower on his back. It took Eric Scott 21 seconds actually to cross the Gorge, which is 1,500 feet wide, 1,100 feet deep. And of course, he set a bunch of records doing that. This could be the next -- the new thing. How we get around.
It reminds us of the time that our own Rob Marciano, by the way, took a dive from 1,400 feet -- there he is -- back in May. That time, though, there was a parachute involved. Whoa! Looking good up there, Rob. Would you do it again?
ROB MARCIANO, CNN METEOROLOGIST: I don't know how that - yes, of course. I'm not sure how that relates, but --
CHETRY: Hey, you're both -- you're both guys flying through the air, OK. Jumping out of perfectly good airplanes.
MARCIANO: He's got a jet pack on.
CHETRY: Yes.
MARCIANO: 800 horsepower, and he's going up. I'm going down. And curiously with some strange man strapped on my back. So, you know --
CHETRY: That's right.
MARCIANO: -- you know, the bravery factor -- I guess you can argue both sides of that occasion.
CHETRY: Yes. But, you know, what I have to say, you should get on that jet pack stuff. I bet you, you would love that.
MARCIANO: I would like to try that. You know, Miles -- Miles did it. He said it was kind of fun. And I think it's powered by hydrogen peroxide. So if you do happen to crash, at least you have some first aid ointment.
CHETRY: See that? Right there.
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CHETRY: How about it? You want to watch tomorrow. Eric Scott, the jet pack man, is going to be on the show.
MARCIANO: Is he?
CHETRY: Yes. He's going to bring that thing into the studio.
MARCIANO: Sweet. Let's put that on your back.
CHETRY: We got too many lights in here.
MARCIANO: Come on, Kiran.
CHETRY: But, hey, it should be cool. He can show us how he does it. Rob, thanks.
MARCIANO: All right.
JOHNS: We're 56 days away from Barack Obama's inaugural. It is the hottest ticket in Washington and as you might expect security for that big event will be quite tight.
CNN's Jeanne Meserve tells us how the Secret Service is planning to keep the inauguration and the people attending it safe from a variety of threats.
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JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT (voice-over): Inauguration, a moment of history but also a time of risk.
FRED BURTON, FORMER STATE DEPARTMENT SPECIAL AGENT: Any kind of contingency that you can think of the Secret Service has game boarded and has got a plan in place to deal with.
MESERVE: One scenario, a gunman. Countermeasures, snipers who can shoot with tremendous accuracy at a distance of 1,000 yards. Surveillance with thousands of cameras, some mounted in helicopters and police, thousands of them, some in plain clothes. In addition, every visitor to an inaugural event can expect to be screened.
Another scenario, a truck bomb. Countermeasures include extensive street closures around the capital and parade route, searches of vehicles, explosive sniffing dogs.
Yet another possibility, a weapon of mass destruction. Countermeasures, monitors to sniff the air for chemical or biological hazards and what about protection against a nuclear or radiological threat?
MALCOLM WILEY, U.S. SECRET SERVICE: I won't talk about that.
MESERVE: Some parts of this still off limits.
WILEY: Correct.
MESERVE: Another avenue for attack, the Internet. To counter that possibility, the Secret Service is partnering with other law enforcement, the military, private industry, universities, to protect critical infrastructure. Of particular concern, an attack disrupting electricity.
WILEY: It could hamper our ability to communicate with one another potentially.
MESERVE: And more.
WILEY: And more. Absolutely. And more. It could hamper the ability of elevators to move within the Capitol and if we had to protect there, that could be an issue.
MESERVE: And security plans aren't finished yet. They will continue to evolve as the threat picture does.
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MESERVE: A word of warning, if you're planning to come to Washington early, if you are too early, it will be a wasted effort. The Secret Service will be kicking everybody off the Mall, the Capitol grounds and the parade route to do a security sweep the morning of the inauguration.
CHETRY: Strike out.
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JEANNE MOOS, CNN NATIONAL NEWS CORRESPONDENT: The company bought the naming rights for the stadium the Mets will move into next year for a record $400 million over 20 years.
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CHETRY: Jeanne Moos looks at the baseball bailout. Citigroup's multimillion dollar deal that you could be paying for. You're watching the "Most News in the Morning."
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DAVID LETTERMAN, THE LATE SHOW WITH DAVID LETTERMAN: The federal government is raising like a $40 billion to bailout Citigroup. You know what I'm saying? Because honestly when you think about it, who doesn't really feel sorry for credit card companies, you know? Honestly.
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JOHNS: Welcome back to the "Most News in the Morning." Another bank bailout and more talk of a stimulus package to give the economy a jolt so we can recover. It's the economy for dummies, not the dim- witted kind. The kind you give CPR, too. Here's CNN's Jeanne Moos.
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MOOS (voice-over): You know we're in trouble when the president says --
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We'll recover from it.
MOOS: Both the outgoing and the incoming presidents sound like they are talking about a patient in critical condition.
OBAMA: We need a stimulus, a big stimulus package. That will jolt the economy back into shape.
UNIDENTIFIED FEMALE: Oh, man!
OBAMA: To stabilized the financial system.
MOOS: The latest patient to be stabilized --
(on camera): You heard Citibank is in trouble?
UNIDENTIFIED FEMALES: No.
UNIDENTIFIED FEMALE: I mean, they are huge. How can they be in trouble?
MOOS (voice-over): But as we hit up customers after they hit the ATM, almost no one talked of dumping Citibank.
UNIDENTIFIED MALE: I'm not nervous. It's great bank. Huge. It will not fail.
UNIDENTIFIED MALE: I'm optimistic. I don't know what else we can be.
UNIDENTIFIED MALE: I guess the best decision is just to leave it here. I can't put it under my mattress. I don't know what else to do.
UNIDENTIFIED FEMALE: One bank is as bad as another.
MOOS: Only one woman we talked to was really worried.
(on camera): Did you actually went up to a teller and said, hey, is my money safe.
UNIDENTIFIED FEMALE: Yes. I don't know if I can trust it. MOOS (voice-over): They told her yes. And the tellers had their own questions.
UNIDENTIFIED FEMALE: They asked me -- is CNN still out there bugging our customers.
MOOS: When we bugged this lady, she joke she'd come to the bank.
UNIDENTIFIED FEMALE: To see if they are giving samples.
MOOS: Citigroup may need a bailout. But Met fans will still see strike out at Citi Field. The company bought the naming rights for the stadium the Mets will move into next year for a record $400 million over 20 years.
UNIDENTIFIED REPORTER: At the time it seemed like a perfect deal.
MOOS: Citigroup still thinks it's a good idea calling it an important marketing priority, not to be confused with Enron Field, which turned into Minute Maid Park after Enron's downfall. Somehow all this brinksmanship doesn't seem real.
UNIDENTIFIED FEMALE: How can it seem like real money when they are talking about hundreds of billions of dollars? It's just like they keep adding zeros and commas.
MOOS: Meanwhile, it turns out Citigroup which offers a credit card with purchase protection against defective merchandise had a few defects of its own. Jeanne Moos, CNN, New York.
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CHETRY: Banks in crisis, yet still spending? $400 million to name a new baseball stadium? Why is Citigroup still out there buying, buying, buying.
Plus, it's the Mecca of all Martian sightings. Well, sort of. Miles O'Brien investigates the Roswell incidence. We're back where it all began.
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MILES O'BRIEN, CNN CHIEF TECHNOLOGY AND ENVIRONMENT CORRESPONDENT: It could have happen in a more remote place, could it?
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CHETRY: Crashes and cover ups and questions. You're watching the "Most News in the Morning."
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CONAN O'BRIEN, HOST, "LATE NIGHT WITH CONAN O'BRIEN": Today a correspondent on CNN, this really happened, explained how to feed eight people for Thanksgiving for less than $30. That's true. Yes, it was called Thanksgiving at white castle. Yes, it's nice.
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JOHNS: The bad combination when money gets tight and the holidays are closing in. So, how do you explain to your kids that Santa is on a budget? And still spread the holiday cheer without breaking the bank. Joining me now is Janet Bodnar, the deputy editor of Kiplinger's Personal Finance Magazine and the author of "Raising Money Smart Kids."
Thanks so much for coming in.
JANET BODNAR, DEPUTY EDITOR, KIPLINGER'S PERSONAL FINANCE MAGAZINE: My pleasure.
JOHNS: I guess before we sort of get to the meat of it, I just wanted to ask you, how do you sit down in the first place and prepare yourself to talk to kids about a thing like this? Obviously, if you've had a big cut in cash, it's a little bit emotional for you and now comes the holidays. How do you prepare yourself?
BODNAR: Well, you got to keep your cool when you're dealing with kids. Because what kids want, this is kids of any age is they want reassurance. They are going to pick up on your signals if you've got tension in the household, so you need to be aware of that. But, you know, it's like the saying goes, "Never let them see you sweat." You have to be in charge. You're the parent so you have to be reassuring.
JOHNS: All right. So now, we have some full screens. We just want to put up and show and talk a little bit about some of the points you've made. Number one is set or adapt your own customs. Talk to us a little bit about that.
BODNAR: Well, you know, every family has their own holiday customs, and this maybe a year that it's going to be a little lean in your household. It maybe a year to adjust those customs. So if the kids are getting -- or accustom to getting a big pile of stuff under the tree, you can say, look, you know, we're going to be cutting back this year. You can ask Santa for one present and then there will be a few presents from mom and dad.
But we're going to think of thoughtful things that we can do for each other or creative kinds of gifts. Things that maybe we haven't done in the past. And set a new tradition that will last this holiday season but into the future as well.
JOHNS: And that sort of flows into the next point which is have the kids sort of set the choices.
BODNAR: Exactly. Take this as a learning experience, especially for kids who are a little bit older, maybe elementary, certainly middle school aged. If you're making list of things that they want, let them indulge the list, but then say, OK, if I had to narrow this down or if you have to narrow this down to your five top things what would they be? And if there are certain things that you know are just not going to happen, either because they are too expensive or they are too dangerous for the kids, or the kids just don't need them, let the kids know up front so they know.
JOHNS: And then there's the issue of sort of being creative, which is something so many of us do when the holidays come around. But, now, especially important if money is tight.
BODNAR: Yes. You know, you really do -- you know, you really have to talk to your kids about how much is really going to be in your budget, and sometimes kids are going to say, well, you know, I can ask Santa for this present. And you really have to let kids know that you and Santa are doing this together so that, you know, mom and dad and Santa work together, and so -- you're not going to be asking Santa for something that mom and dad don't want to get them or don't think is suitable for them.
JOHNS: And the other point needs a little further explanation. Get Santa on your side? What do you mean by that?
BODNAR: That's right. Well, you know, again, it's true. You know, kids will say, well, what if I -- what if I just do this -- do an end around mom and dad. But, again, you know, Santa's investments may have gone south this Christmas as well. So you want to be sure that he is on your side and that the kids know this, so that the kids are not going to say, we're going to do this -- that, you know, you and Santa are working together, and so the kids know what's going on.
Again, you really just have to be upfront with them about what the situation is. You don't want to overload them with information that they can't process, but you don't want to raise expectations.
JOHNS: Great advice. Thanks so much, Janet Bodnar.
BODNAR: Oh, my pleasure.
JOHNS: Kiran, back to you.
