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American Morning
Explosives Found in Parisian Store; Caroline Kennedy Wants to Replace Sen. Clinton; List of Victims in $50 Billion Scam Grows; Tourist Plane Missing; Biden Gets a Puppy
Aired December 16, 2008 - 08:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JOHN ROBERTS, CNN ANCHOR: We are crossing the top of the hour. And here are this morning's top stories. We are following breaking news out of Paris, where police say they have found and diffused several sticks of dynamite at the upscale Printemps Department Store.
Police immediately evacuated the building. Officials tell CNN that a group known as the Afghan Revolutionary Front sent a letter to French press agency warning of the attack. Our affiliate in France reporting the group wants French troops out of Afghanistan by the end of February.
We're also following breaking news this morning out of the Dominican Republic. Officials there reporting a tourist plane on its way to Turks and Caicos with 11 people on board has gone missing. Turks and Caicos is just almost immediately north there of the Dominican Republic. Don't know if the plane was gone missing over water, or whether it was headed to Grand Turk Island, Providenciales to the West, or one of the other smaller islands in the middle.
Caroline Kennedy making a run for Hillary Clinton's Senate seat. She's already campaigning hard calling New York's top Democrats. Some critics say that she has little experience, something her cousin Kerry Kennedy addressed earlier right here on AMERICAN MORNING.
(BEGIN VIDEO CLIP)
KERRY KENNEDY, COUSIN OF CAROLINE KENNEDY: This is an incredibly important moment in our history. And for all the issues that are important to Caroline. Number one, she has raised $70 million, over $70 million for New York public schools. There are very few women in the Senate and very few mothers. And we really need someone with that experience and I think Caroline will be great.
(END VIDEO CLIP)
ROBERTS: New York Governor David Patterson will appoint the next senator. And when asked about Kennedy, he was decidedly non-committal saying, quote, "I have a number of conversations with a number of people who are interested."
And returning to our breaking news this morning. Police have been combing a popular department store in Paris after five sticks of dynamite were found and disabled. A group calling itself The Afghan Revolutionary Front claims to have planted the explosives there. International security correspondent Paula Newton has got the very latest for us.
Paula, so many times we have talk to anti-terrorism experts, security experts, and this is what they point to as potentially the next target. I guess so called soft targets like department stores, where even a small explosion could create an incredible amount of panic and also scare people away from department stores for a long time, and creating extensive economic impact as well.
PAULA NEWTON, CNN INTERNATIONAL SECURITY CORRESPONDENT: Already the anxiety, John. Imagine, in Central Paris right now, shoppers having to be told that you have to evacuate and that there is a suspicious package inside. In fact, dynamite was found.
The Interior Minister of France saying that what she knows is that it was not rigged in order to explode. Now you have to think this group, the Afghan Revolutionary Front previously unknown sent a letter in the mail. Clearly, you could characterize this as a hoax attack. But on the other hand, as you just pointed out, John, this is the kind of thing that intelligence officials have been warning about. That those soft targets can really cause a lot of damage and can really prey on all of our anxiety about how terror is going to hit home next.
You know, the Taliban had warned of attacks in Western countries at the end of November. I have to say this group does not have those kinds of fingerprints on it. I can tell you if the Taliban wanted to hit that kind of soft target, it would have found the capability and have tried to do it. The President Nicolas Sarkozy now weighing in and saying that he intends to remain vigilant and firm on this issue of terrorism. He again saying that they will continue to try and figure out who's behind it.
John?
ROBERTS: The group that claims responsibility for this, I guess, this is really just a scare tactic more than anything, because there was some indications that there was no detonator actually connected to the sticks of dynamite. More just a symbol of we can do this if we want to. The group called The Afghan Revolutionary Front. Do we know anything about them?
NEWTON: Absolutely not. And certainly I have never heard of them. I went ahead and did some searches. But, again, these groups do crop up. And you have no idea if they're "freelancers" or if they actually have credible and legitimate ties to the Taliban.
We certainly know that the Taliban means business. They had an attack on French soldiers. Really slaughtered 10 of them in Afghanistan, itself. Definitely France is a target on the Taliban radar. What French authorities are trying to do now is trying to figure out who would have laid these bombs there. These sticks of dynamite. They weren't actually bombs. And figure out, is there more to come? Is this a campaign to try and destabilize Paris or other European capitols ahead of this holiday season?
Again, this is the kind of worst nightmare that intelligence authorities have on their plate. Because what they do not want is that sense of fear and panic to start setting in to the European capitals. And they've been told repeatedly they are on the firing line.
John?
ROBERTS: All right. Absolutely. Paula Newton for us this morning, working her sources. Paula, thanks so much for that.
CHETRY: Well, this morning, we know Caroline Kennedy has been making calls about Senator Hillary Clinton's Senate seat. Remember Caroline Kennedy endorsed Barack Obama during the campaign, and the tension with the Clintons behind the scenes may get in the way of her taking Hillary's spot. Well, CNN's Mary Snow is following the story for us this morning.
We know that she's called the governor, who is single-handedly the one able to make this appointment and expressed her interest.
MARY SNOW, CNN CORRESPONDENT: She did. And as you mentioned, you know, these tensions with the general elections, some Hillary Clinton supporters have come out. They've been critical of her. The next step, New York Governor David Paterson said that Caroline Kennedy has told him she wants to sit down, be with him, make her case of why she is suited for the job. She has a record of pubic service, but she's never held public office and this is a departure for her.
(BEGIN VIDEOTAPE)
SNOW (voice-over): Caroline Kennedy is ready to step into the public eye that she's worked to avoid for most of her life. The 51- year-old daughter of the late president, John F. Kennedy, told Democratic officials she's interested in filling the Senate seat now held by Senator Hillary Clinton, assuming her nomination as secretary of state is confirmed. New York Governor David Paterson has the power to appoint a replacement and says he's spoken with Kennedy.
GOV. DAVID PATERSON (D), NEW YORK: She told me she was interested in the position. She realized that it was not a campaign, but she was talking to other people because she thought that a number of people she felt should know that she's interested in the position.
SNOW: Kennedy has largely stayed out of the public eye until this year when she endorsed Barack Obama during the Democratic primaries and even campaigned for him.
CAROLINE KENNEDY, OBAMA SUPPORTER: I have never had a candidate who inspires me the way people tell me my father inspired them. But I do now.
SNOW: Kennedy is an attorney, author and mother of three. She oversees her father's presidential library. And in New York, she's worked to raise money for private partnerships for New York City public schools. The school's chancellor, Joel Klein, supports her. And so does New York Democratic Congresswoman Louise Slaughter, who endorsed Kennedy crediting her skills and intellect. But some Democrats in New York have questioned her qualifications, and New York Democratic Senator Charles Schumer was asked whether he thought she was qualified.
SEN. CHARLES SCHUMER (D), NEW YORK: I think there are 12 candidates whose names have been mentioned. I think every one of them is qualified.
SNOW: One of the candidates whose name has been thrown out, State Attorney General Andrew Cuomo, who was once married to Kennedy's cousin, Kerry. One Democratic strategist says one thing is certain, this will be a hotly contested seat.
HANK SHEINKOPF, POLITICAL CONSULTANT: What you do know is Caroline Kennedy has no public profile, has never served in a legislative office. Frankly, nobody knows much about her. And the Kennedy name? Well, this is not 1960 anymore. This is 2008.
(END VIDEOTAPE)
SNOW: And in two years, in 2010, whoever replaces Senator Clinton will face a special election. New York Republican Congressman Peter King has already expressed interest. He wasted no time taking a jam. But his potential challenger saying Caroline Kennedy's interest makes him more determined than ever to run.
Kiran?
CHETRY: All right. We'll see how it goes. Mary Snow, thanks so much.
SNOW: Sure.
CHETRY: And Fran Drescher also the star of "The Nanny" wants to get in the ring as well. She's made it clear she's interested in being the next senator from New York. Last night on CNN, Drescher spoke exclusively to Larry King. She talked about her qualifications and about whether she thinks Caroline Kennedy is qualified.
(BEGIN VIDEO CLIP)
FRAN DRESCHER, ACTRESS: I can't really answer that question. I think that she has a lot going for her and she certainly has the Kennedy name. And I'm very close with many of the Kennedys. And I've had dinner with her.
And, you know, I mean, if it -- if we're going to be judged on our families, I think she's got it hands down.
(LAUGHTER)
DRESCHER: But my dad was working two jobs when I was growing up -- one for Sears and Roebuck and one for the U.S. Post Office.
(END VIDEO CLIP)
CHETRY: Drescher also went on to point out that she's public envoy for the U.S. State Department and also just returned from eastern European where she spoke about women's health issues. ROBERTS: Well, you might think that the people who got swindled by the $50 billion Wall Street scam artists were easy marks. Well, one of the victims was the editor-in-chief of U.S. News and World report, and he's here to tell us how it might had happened.
And now that the whole world has seen shoes thrown at President Bush, what's the reaction from the Arab streets. You might be surprised. It's nine minutes after the hour.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": And a teacher in England has been fired after she told a class of 7 year olds, there was no Santa Claus, which, ironically, is the same thing Congress told the automakers.
(END VIDEO CLIP)
ROBERTS: Christine Romans here "Minding Your Business" this morning at 12 minutes after the hour.
We're talking about the fed meeting and whether or not they're going to lower interest rates again to try to boost the economy. And things are going oh so low these days.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Oh, they really are. Can you imagine a zero percent fed funds target? I mean, that is incredible to think of zero percent interest rate.
ROBERTS: But what does it mean to folks at home?
ROMANS: It would mean -- well, we're not expecting it to go all the way to zero. Right now, it's one percent. It's the feds funds target as one percent. They're expecting this to be cut in half, about half a percent. That means it's so cheap to borrow money. It makes it even cheaper to borrow money. And the fed is likely to be signalling many people thinks that it wants to keep doing other things to push down your mortgage rates.
You're hearing a lot of people talk about policymakers having 4.5 percent in their sights. They would like to see a mortgage rate for us of 4.5 percent, maybe sometime next year.
ROBERTS: OK. So they're making it so cheap to borrow money, but we hear about this credit crunch. Nobody is lending, so --
ROMANS: And at what point will it unlock all that lending. Will the demand for all of this credit unlock that lending and get the economy going again?
We know that when mortgage rates tick down over the past couple of weeks that we saw a surge in refinancing activity. And we saw just a surge out of nowhere. People going and talking about refinancing their mortgages. That puts money back in our pockets, puts money back in the economy and that's what policymakers are hoping to do.
But what's troubling the fed -- I mean, why are we talking about lowering rates to such historic low levels. I mean, make no mistake. It is very, very rare to be talking about mortgages rates -- I'm sorry, fed fund rates this low. This is what's troubling the fed. The same money worries of troubling you and me. Just most recent, personal bankruptcy data up 30 percent over the past year. Million people filed for bankruptcy over the past year. Almost two million jobs had been lost, and home foreclosures are accelerating. The situation is so bad in the foreclosure crisis that even Fannie Mae has now said it's not going to evict the renters of the homes that had been foreclosed on. Fannie Mae owns the mortgages, where they're going to become a landlord -- the government becoming a landlord so it doesn't have to kick people out.
ROBERTS: So if you're a homeowner who still gainfully employed, you're making your payments and you've got a mortgage just about 5.5, maybe 5.75 percent. The fed makes its rate cut. Mortgage rates do go down toward that 4.5 percent. That would be a fantastic time to refinance and lock in at a long term.
ROMANS: And that's what they're hoping over the next year. However long it takes to drive those mortgage rates down, that it would be a good time for people to refinance their mortgages.
(CROSSTALK)
CHETRY: That doesn't help people that are either under water or heading towards foreclosure?
ROMANS: No. You've got to be able -- you have to be in a position where you -- no, it isn't. But there was a thing - (INAUDIBLE) try to boost the economy. And we will be looking to hear what they say that's beyond even lowering the mortgage rates. What are they going to say about? They call it quantitative reasoning. You will probably going to hear about that this afternoon. What are these other things that they are going to do to try to frankly rescue the economy here? What are they going to -- it's beyond the scope of regular rate cutting that people are really interested in here.
ROBERTS: We'll keep watching. Christine, thanks for that.
ROMANS: Sure.
CHETRY: And still ahead, well, how to make six figures with your own video camera. We're going to meet a young man who left his day job and is now making big bucks, thanks to you.
And the dog that seal the deal. The VP's new puppy. Why Joe Biden picked a German shepherd as his new little pet. How adorable. It's 15 minutes after the hour.
(COMMERCIAL BREAK)
CHETRY: Breaking news, and police in Paris combing a popular department store after five sticks of dynamite were found and disarmed. A group calling itself The Afghan Revolutionary Front claims to have planted those explosives. Our Jim Bitterman is live in front of Printemps in central Paris with the latest details for us.
Jim?
JIM BITTERMAN, CNN SENIOR EUROPEAN CORRESPONDENT: I can hear, I can hear the director, but I can't -- or the producer, but I can't hear the show.
CHETRY: Jim, can you hear us now?
BITTERMAN: Hi, Kiran. Yes, in fact, we're here. This is the busiest time of the year, of course, in Paris, just as it is everywhere else in the world, holiday shopping season. But the doors here at the Printemps store still closed. They're still telling people to stay away. They've been closed the last few hours here because of what looked like a bomb that was rigged to go off.
In fact, after the Interior Minister visited here, she confirmed that in fact there had been no detonator on five sticks of dynamite that were found on the third floor of the department store. They were found because of a letter that was sent to Agence France-Presse, the news agency. And the letter said that on the third floor in the toilet, they would find an explosive device. They searched and in fact did find the six sticks of dynamite, but as I mentioned, not rigged to go off.
However, in the letter to the news agency, they also said the people that have claimed responsibility for this also said that, in fact, they would be back if French troops are not out of Afghanistan by the end of February. The group that claimed responsibility for this is The Afghan Revolutionary Front. The Interior Minister said she had never heard of that group before.
Kiran?
CHETRY: All right. Jim Bitterman for us outside of that department store in Paris this morning. Thanks.
ROBERTS: Well, what's it like to find out that you're one of the victims of the $50 billion Wall Street scam. Meet one of the many well-known billionaires who just didn't see it coming. It's 20-1/2 minutes now after the hour.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": A man named Bernard Madoff -- is that the guy's name? The former chairman of NASDAQ has been arrested and confessed to federal officials that he ran a Ponzi scheme that fraud an investment of $50 billion. The name of the Ponzi scheme, NASDAQ.
(END VIDEO CLIP) ROBERTS: Easy to joke about, but this morning the losses continue to mount from that $50 billion swindle allegedly masterminded by investment guru Bernie Madoff. And the expanding investigation is revealing a growing list of big names and big charities now watching their savings slip away.
Joining me now is one of the man who fell victim, Mort Zuckerman. He's the chairman and editor of U.S. News and World Report, as well as the chairman of Boston Properties.
Sorry to hear about what happened, Mort, because it was a charitable trust fund that you're running.
MORT ZUCKERMAN, CHAIRMAN/EDITOR-IN-CHIEF, U.S. NEWS AND WORLD REPORT: Yes.
ROBERTS: How hard were you hit?
ZUCKERMAN: About 10 percent of the assets of this charitable fund that I set up eight years ago was lost. We had diversified the investments with a group of fund managers. One of them was the Ascot fund which had a billion, $800 million in the fund. We had $30 million in that fund. But the guy put the entire billion, $800 million, a 100 percent of it, with this guy, Madoff. So there's something weird here, because you never put all your eggs in one basket in investments. The basic principle of investment is diversification.
ROBERTS: Diversification, yes.
ZUCKERMAN: So there's something wrong here. There's something wrong with this whole system when people who are investors can do this without any appropriate degree of control.
ROBERTS: So did you lose all of that $30 million?
ZUCKERMAN: As far as I know, yes. The charitable fund did.
ROBERTS: That represented about 10 percent of the charitable fund?
ZUCKERMAN: Of the fund, yes. I mean, I didn't contribute the money here to have it blown away by this silly man. I wanted to do a lot of good things with it and have done, I hope, some good things with it. And so it's really frustrating to have to deal with this.
ROBERTS: I mean, in terms of the people who got bilked -- and again, if we want to say this is not your personal money, it's your charitable trust, you're in very good company, because some of the other people who lost a lot of money were Ellie Wiesel, a Nobel Prize winner, Senator Frank Lautenberg lost money as well. Steven Spielberg lost money. I mean, these are not mom and pop investors. These are very, very smart people, you know.
ZUCKERMAN: Right. Right.
ROBERTS: You're a very smart person, Mort. How did it happen?
ZUCKERMAN: Well, I tell you, it's mysterious to me, because when I met with this particular fund manager, and I met with him several times a year, he never once gave anybody to believe as a number of other investors have learned to their chagrin as well in this fund that he put all of it with Madoff. That is not the way he reported or represented what was going on. And in fact, it was inconsistent with the terms of the agreement that we all had.
ROBERTS: But even if he put it all with Madoff, I mean, you could have put it anywhere, all of it. And that's not, as you said, sound an investment strategy, but how did this guy dupe so many people for so long with this Ponzi scheme -- this alleged Ponzi scheme?
ZUCKERMAN: This is always the mystery in these things. It's very difficult to control somebody who lies to you and lies to you in a winning way. And that's exactly what happened. This guy, Madoff, somehow, rather was doing this for many, many years and he got some of the major financial institutions in Europe, in the United States. Mass Mutual had $3 billion. The Fairfield fund had something like $9 billion in it. The guy that I was involved with had a billion, eight. I mean, you can go on and on. These are not unsophisticated people. And yet somehow, rather, they got involved with him, and they had, literally, I gather, no idea what he was investing in.
ROBERTS: So the SEC had gone to investigate his operation about a year ago, found no evidence of anything was awry.
ZUCKERMAN: Well, that tells you exactly how good the SEC is, because that is absolutely preposterous. When you have a man running a small shop with his accountant, who is some 78-year-old man, nobody had any clear or independent idea what he was doing. It was preposterous. Just preposterous.
ROBERTS: So what's the upshot of all this, then?
ZUCKERMAN: Well, the upshot of it is, look, there's so much money now involved in hedge funds and funds-to-funds investments, and it had such a big impact on the economy. We have to have intelligent regulation. The difficulty is, frankly, very few people in the world of politics understand finance and frankly, very few people in the world of media understand finance. So you've got to find a way to get really smart people who know this world who can regulate it properly and who can handle it.
But the federal government today has $400 billion from Citigroup, AIG and Bear Stearns. A very toxic paper as they describe it. Nobody understands that paper. I bet you there isn't a single person in the federal government who does it. So they have to hire private people to do this. But they've got to set up some kind of system where you'll have people who understand this world regulating it.
ROBERTS: So what about the incoming administration? You think they've got the goods to be able to regulate this properly?
ZUCKERMAN: We're going to find out. I suspect they're committed to doing it, and certainly this has put enough public exposure on it so that they will actually have to respond in some way. And I hope they do respond in a way.
ROBERTS: Any way to get back the money. I know the federal government has seized whatever assets were left and you might be able to if the IRS aggress, get some sort of tax break on money that was lost because of criminal finance. Can you get any of that back, you think?
ZUCKERMAN: I doubt if any of it is going to come back. So I think everybody is just going to have to swallow it and move on. Thank God our fund -- charitable funds at least retained 90 percent of its assets. But there are a lot of net loss -- all of it. And a lot of very serious charitable work -- charitable work that's not going to be impeded by this crook. I don't know how the man lives with himself -- I'll be honest with you.
ROBERTS: Unbelievable. Sorry to hear, again, because I know that you're putting that money to some good use. Mort Zuckerman, thanks for being with us this morning.
ZUCKERMAN: Thank you, John.
ROBERTS: All right, good to see you again.
Kiran?
CHETRY: It's 28 minutes past the hour. We have breaking news out of the French capitol this morning. Police say they found and diffused several sticks of dynamite in an upscale department store in Paris. The Printemps store was immediately evacuated. France's Interior Minister describes the dynamite as, quote, "relatively old." Says the sticks were found without a detonator. Meantime, a group called the Afghan Revolutionary Front demanding France pull its troops out of Afghanistan is claiming responsibility.
And more breaking news -- an Atlantis Airline plane flying from the Dominican Republic to the Turks and Caicos has disappeared. The Dominican Aviation officials say the plane sent an emergency signal before disappearing from the radar. 11 people are believed to be on board.
The journalist who threw his shoes at President Bush is in the custody of Iraq's military guard where he's being investigated according to an Iraqi government official. Thousands in Iraq protested the man's arrest. The journalist could face charges of insulting a foreign leader and Iraq Prime Minister Nouri al-Maliki, who is standing next to Mr. Bush.
And president's -- the president's security team says it is reviewing tape now of that incident. Security expert say that some minor procedural changes are likely. Agency officials are pointing out the room and everyone in it had already undergone intense scrutiny checks. Others though are questioning the time it took security agents to get -- a member of the secret service, rather, to get up to the podium where Mr. Bush was when the shoes were thrown. Meanwhile, today, another member of the Obama-Biden team is being announced. This is a little one, though. A little smaller than the others. Alina Cho is on political dog patrol today. And she joins us now.
You heard so much about what dog the first family is going to get, and now the Bidens beat him to the pooch.
ALINA CHO, CNN CORRESPONDENT: Yes. As I was saying earlier, second on the ticket, first on the dog race.
Kiran, good morning. Good morning, everybody. You know, you can't deny it. This is very big news. A lot of our viewers watching the story very closely. It's not the big pick everybody has been waiting for, but yes, the Vice President-elect Joe Biden has pick a puppy. It's a 3-month-old male German Shepherd. Take a look at that picture there. So cute. It's going to grew up to be very, very big.
I know you were saying the paws.
The Bidens you know apparently picked him up at a breeder's kennel in Pennsylvania last week and he's reportedly headed off for six weeks of training before settling into his new home, probably a good idea. The dog's been called the pick of the litter and happy go lucky. No word on a name just yet and we haven't heard from Biden on the new addition, but back on election day the then VP candidate talked about the deal he cut with his wife to get him.
(BEGIN VIDEO CLIP)
SEN. JOE BIDEN (D), VICE-PRESIDENT ELECT: Jill said, the only way you can get a dog is be president or vice president. So when Barack was inquiring about would I be - was I willing to get vetted, Jill said, I make you a deal, she said take the vice-presidency, get elected, you get a dog.
(END VIDEO CLIP)
CHO: This would be Biden's fourth German Shepherd. He likes them. As for the name, Biden said he will let his grandchildren do the honors after the first of the year.
As for the power pup everybody's waiting for, no word from the Obamas on the next first pet. But we are hearing from you. Yes, we have commissioned a poll, according to a CNN opinion research corporation poll, most people would like to see a Labrador retriever in the White House. 13 percent as you see there. Some good support for a mutt and tied with poodle at nine percent. I can't believe I'm reading this, Terrier next with seven percent. Then Golden Retriever and German Shepherd at the bottom of the list.
What you don't see on the screen there is that a lot of you 45 percent chose other unspecified breeds, undecided like a lot of people were during the election. But there was one clear choice in the polls. Two out of three people want the next first pet to come from a pound. 67 percent versus 30 percent, who favor a breeder or a pet store, certainly something the Obamas have said they would also like to see happen. He said, you know, I'd like to get a dog from a shelter. You know but many of them are mutts like me. You know, he famously said and they need too have a hypoallergenic dog because Malia is allergic.
CHETRY: That's right.
CHO: That's a consideration.
CHETRY: Although they may not be mutually exclusive though.
CHO: Right.
CHETRY: They did talk about that, a couple of New York papers, a local shelter said we have dogs that are both mutts and hypoallergenic.
CHO: Exactly.
CHETRY: Come on down and check it out.
CHO: Well, you know, so many dogs need to be rescued. Hopefully they'll be able to find that happy medium and that balance.
JOHN ROBERTS, CNN, ANCHOR: A lot of disagreement on the idea of a hypoallergenic dog. There really is no such thing.
CHO: Really?
CHETRY: That they can be -
CHO: I'm allergic.
CHETRY: They can predict 90 some percent but they can't totally guarantee it.
ROBERTS: And if you're not allergic to the dander, you might be allergic to the saliva.
CHO: Don't be a Debby downer about it.
ROBERTS: All right.
Do you need a job? Have a video camera? Meet a young man who quit his day job and now nets six figures.
And it was the shoe toss seen around the world. What's been the reaction in the Arab world to it and what's likely to happen to those shoes.
(COMMERCIAL BREAK)
CHETRY: Just in to CNN now, new economic numbers, Christine Romans joins us now to break it down, we're talking about housing and inflation.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Yes. Let's talk inflation first. Because this is really important. We know that gas prices have been down and a lot of commodity prices have been down and that's reflecting in the prices that you pay at the pump. It's reflecting in the transportation prices and a lot of different components of the consumer price index.
So we have the consumer price index down pretty sharply, getting a little more than people have been expecting. Usually, these are numbers that move in tenth of a percentage point. I mean they're moving more than one percent, down at this point. So watching the consumer price numbers, you know, this is good for you in that it reflects what you're paying at the pumps. It's almost all of this but you're seeing a little bit of an up tick in apparel, barely an up tick in apparel prices and then food prices as well.
But the overall trend overall for inflation is that it's down. The concern about that of course is that could be deflation at some point? Right now, it looks sort of disinflationary and not too wonky for you but deflation is something that can be dangerous for the economy overall. So it's good news for what you're paying.
CHETRY: In the short term, it really is almost like a stimulus.
ROMANS: Absolutely. You're paying a little bit less for things and that's something that helps right here. But it is a reflection of just how weak the economy is and demand is. Housing starts down very sharply, 18.9 percent, no surprise there.
I mean there's no incentive here for these builders and frankly, there's no credit here for many builders to be starting new home construction. So housing starts here plunging. The longer term, Kiran, that can be seen as good for the economy, too. because in this kind of environment, we don't need an awful lot of new homes. Do we?
CHETRY: Right. Although the companies who employ people say there's always s flip side to the coin.
ROMANS: That's right.
CHETRY: Christine, thanks so much. John.
ROBERTS: The video of an Iraqi reporter throwing his shoes at President Bush over the weekend is all that anyone can talk about these days. But throwing shoes is the ultimate insult in Arab culture. So what's been the reaction from Muslim communities. Joining me now, Salameh Nematt, international editor of the dailybeast.com. He's in Washington for us this morning, Salameh, we have seen in some cities in Iraq that this young fellow is being held up as a hero of sorts.
Is that the sentiment more broadly in the Arab street?
SALAMEH NEMATT, INTERNATIONAL EDITOR, DAILYBEAST.COM: I wouldn't know because the Arab governments don't allow for public opinion poll. We don't know. In Iraq, we have seen demonstrations by people loyal to the cleric Sadr, who is a crony of Iran. Basically, he's doing Iran's bidding there. Iraqi journalists I spoke to in Baghdad condemned this act. It's a disgraceful and shameful. The elected Iraqi government also condemned this attack in the harshest of words. So I don't know exactly whether we can generalize. There are people who are frustrated with U.S. policies in the region but I don't think that would give justification for a journalist to throw his footwear at the U.S. president.
ROBERTS: You know some of the reaction we've seen praising this young fellow comes from Syria, Moammar Gaddafi's daughter apparently has awarded him not in person obviously, a medal of courage. Always seen people who have argument with the United States holding this guy up as an example of fighting back, if you will.
NEMATT: Absolutely. I mean we haven't seen any journalists hurling shoes at Saddam Hussein who dispatched 300,000 people to their mass graves in Iraq, waged two wars against Iran and Kuwait, killing 1.5 million people, simply because nobody would have dared do that because there would have been summarily executed. But you know, Gaddafi's regime is not exactly democratic. Gaddafi took power nearly 40 years ago and has been ruling, you know, with an iron fist.
A couple of years ago, he killed a blogger because he criticized government policy. Syria is the same thing. You know the Syrian regime has a lot of blood on its hands, 20,000 people were killed in three days by his father, by Assad's father. So we're not exactly talking about representative governments here that are basically celebrating this shameful and disgraceful action.
ROBERTS: Yes. You wrote an article about all of this in dailybeast, Salameh, in which you observe, "the chief irony of this embarrassing episode is that it provided real proof of Bush's success in transforming Iraq into a democracy. Not that the president ever contemplated freedom of expression going this far." As you said it was disgraceful to you. You called it a disgraceful display. I mean, is this what democracy is all about in Iraq. You can obviously protest the policies of government in a democracy but should we be throwing shoes at its leader or the leader of another country?
NEMATT: Well, obviously, you know, the question answers itself. You know, democracy also has rules. There's a rule of law in democracy. You cannot throw shoes at dignitaries or anybody for that matter. So I think that you know what happened is a form of self-expression that has gone way to the extreme. In a sense, that is unacceptable. And you know, I think the Iraqi authorities have made that very clear in their statements.
ROBERTS: Salameh Nematt, it's always good to catch up with you. Thanks for coming in this morning.
NEMATT: Thanks, John.
CHETRY: Well imagine getting paid a lot of money simply by making funny videos and posting them on YouTube . Is it too good to be true? Find out next, 40 minutes after the hour. (COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
MICHAEL BUCKLEY, MAKES SIX-FIGURE INCOME OFF YOUTUBE: And then due to the parity of single ladies with boys as backup dancers and Justin Timberlake and they were warmed up like biscuits, dance biscuits and now to my favorite part, OK I'll do it. Oh.
(END VIDEO CLIP)
CHETRY: That was Michael Buckley, reminds me of my Christmas party that took place at a show a couple of days ago, a lot of dancing like that going on there. He's channeling Beyonce on his very own YouTube video show. YouTube has been very, very good to Michael. In fact, he has been able to quit his day job to work full time creating videos. Now he's making a six-figure salary. Michael Buckley is here to tell us exactly how he does it. Welcome.
BUCKLEY: Well, thanks for having me. I won't dance on the chair.
CHETRY: If you can go around and dance like Beyonce, anyone can and we can make money off YouTube.
BUCKLEY: You know it's not that easy. I know I make it look so effortless. And it's so funny. Because after the story came out that I was generating revenue on YouTube, I got so many e-mails from people, like how do I do that? What can I do? It's not that easy, you know, I have over 400 videos and over 300,000 subscribers. I was doing this full time for over two years before I made a dime. So I mean, I just loved it so much, and now the fact that I'm making money off it is just awesome.
CHETRY: So explain, I mean, it's not just posting your child's first birthday up on YouTube or a funny clip you got off "Saturday Night Live." How, if you're somebody who wants to try to make money using YouTube and to make money from videos being seen, how does that happen?
BUCKLEY: Well, you can definitely post your child's birthday party. That would go really well. People love kids and cats. If you have cats, put that up there. Don't post "SNL" skits, they'll pull those right away. Someone like me, I have scripted show I wrote myself. It's called "What's the buck?" I created a concept for a show that I can maintain and I just love doing it. But I mean that's what people enjoy. It's a scripted show, I do it three times a week, and I make fun of celebrities. Everybody enjoys that. Here's one making fun of Miley Cyrus, what happened on the hill last night? So but again, many people do. There's comedic bloggers. There's sketches. There's somebody like me that does a scripted show, there are lots of different people posting videos on YouTube.
CHETRY: But it's a select group. YouTube has a way of figuring out how many hits you're getting. And if you're somebody who is getting a million hits, like you were, they find way to help you get in on the advertising revenue. BUCKLEY: Right.
CHETRY: So you keep making videos that people find interesting and people go to YouTube.
BUCKLEY: So YouTube has a partnership program and so several of us. And there's many now. When they started, there was probably 40 and then 75 and then now it's open up to anybody. You can actually apply, you can go to YouTube.com and there's a link to apply to be in the partnership program. I'm not sure of the exact criteria. But they're definitely looking for people with a couple videos. So don't just post once video and be like oh, I want to be a partner. Oh I want to do this. Like I said, I had over 100 videos before anybody knew who I was and I just loved doing it and so I'm very fortunate.
CHETRY: You know, you talk about the viral nature of the web and of YouTube, meaning if somebody is funny, you tell your friend, you send a link, and that's how this generated. I mean is that how you became so well-known on YouTube?
BUCKLEY: Definitely not me. I mean that's why I'm happy to be doing some press now about it. Because I was never an overnight sensation. I was never somebody who did something outlandish and had a viral video. I was someone who just worked very hard on scripting, in marketing, in creating a show for myself. And so I was never an overnight success. I mean, I've been doing like I said for well over two years. Nobody knew who I was. Like now because I have had some mainstream traditional media, people know who I am but people have known who I am on YouTube for over a year and half or so.
CHETRY: That's very fascinating. So the other interesting thing is we talk about the recession that's going on, layoffs, people maybe needing to start over again, you were able to take a passion, something that was a hobby and parlay it off into a career. You say you've been able to pay off your bills, pay on your credit card debt, save some money. How do people sort of capitalize on that? How do you take that risk and say you know I will quit my day job.
BUCKLEY: Well, it was definitely. I was doing double income for a while. It wasn't like I just threw the day job away. I had my day job as long as I could and then I had a couple other things come up as well. I have other sources of income now besides YouTube. Because of YouTube, though I was seen on YouTube and I have deals based on that. But again yes, the internet, not like the old days, you open up the newspaper and look for a job. I mean, the internet is a huge place where you can be looking for work or what I did is create something entire for myself. You know, YouTube, you can do that, you can create a YouTube channel and build a brand you know from scratch.
CHETRY: Very fascinating. Well, good luck to you. Because as you said it's led to other things now. They're interested in maybe doing your show, right?
BUCKLEY: You know, I have a development deal with HBO. I do stuff for "E." I just signed something with Sony. I do live shows on blog TV. I'm good though. CHETRY: You're going viral.
BUCKLEY: I'm very happy though in the new media. It's like I'm happy to step my toe in traditional media but I love being at the front of new media and I love YouTube. It's changed my life. And I'm so grateful to the site and everybody who's on YouTube.com.
CHETRY: Wow. That's exciting. Well, Michael, thanks so much. A great success story. Michael Buckley, thanks for being with us this morning.
BUCKLEY: Thank you.
(BEGIN VIDEOTAPE)
ROBERTS (voice-over): The lame duck ducked.
UNIDENTIFIED FEMALE: Dodging and weaving? I mean, he has done that through his whole administration but we have never actually seen that filmed.
ROBERTS: Now the real fun begins. Jeanne Moos on how the internet is getting a huge kick out of the president's shoe attack. You're watching the most news in the morning.
(COMMERCIAL BREAK)
CHETRY: Well, the top videos right now on CNN.com's most popular protest against Australia's prime minister calling his announcement to cut carbon emission levels by five percent by 2020, not nearly enough. Environmental groups calling for a minimum of 25 percent reduction.
A model from Argentina raising some eyebrows with this pose on the cover of a Mexican "Playboy." The video was released or the cover rather released to coincide with the Virgin of Guadalupe Festival. Religious groups are seething. "Playboy" says the image was actually it was a portrayal of a Renaissance-like mood and not the Virgin Mary. The magazine is now apologizing.
And which would you rather have, internet access or sex? The latest survey says 46 percent of women would give up sex for two weeks if they could just log on, only 30% of men agreed. And that's what's most popular right now on CNN.com
ROBERTS: Let's see, internet or sex, love my cnn.com. Googling it has become a household term. And now it has a lot more uses including you get fit.
Our Dr. Sanjay Gupta joins us with this week's "Fit Nation" segment. How can a search engine help you lose weight? Come on.
DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: It's a bit of a paradox, right, John. I mean you're online all the time so you don't get the chance to get outside and exercise. But what if you were possibly getting some unintended benefits or intended benefits? Take a look. (BEGIN VIDEOTAPE)
GUPTA: Life here at Google headquarters in Mountain view, California is a bit different from most jobs. Free food, free time and a free form working environment.
KEN NORTON, PRODUCT MANAGER, GOOGLE: Food is amazing because it's great. It is everywhere, so you got to be careful.
GUPTA: But still people like Ken Norton, a product manager here face the same work-life balance just like the rest of us.
NORTON: I'm a competitive cyclist. And I am always trying to balance the training time on the bike with two little kids and a family at home and a full time job.
GUPTA: So in an effort to simplify things, Ken has turned to a product he helped develop. The Google calendar. To manage his busy lifestyle, putting his training schedule at his coach's fingertips.
NORTON: You can see today my coach has me riding for two hours in the morning. The purple calendar is my son's school calendar. We have a book fair family night.
GUPTA: The biggest benefit of Google calendar Ken says is that it's portable and that it's shareable.
NORTON: I spend a lot of time at different computers and with my mobile device. And it just doesn't make sense to have a kind of a particular document living in one place. To share it with people on my team, i just click share and those people will be added as collaborator.
GUPTA: And he says even for those of us who are not competitive cyclist, the extra help in organizing our exercise time can be a positive experience.
NORTON: It may be just be as simple as you know blocking out an hour on your calendar to go to the gym at lunch.
(END VIDEOTAPE)
GUPTA: You know, part of this "Fit Nation's" series, we have been looking at a lot of different sites to help people. The Google calendar is one that we came across but there are several others out there as well. Weight watchers.com has some very good tools that we like and then sparkpeople.com as well. And we got a new web site as well, cnnhealth.com, which again with a lot of diet and fitness tools, trying to provide people with online partners to help them get fit. John.
ROBERTS: And then of course there's me constantly sending you e-mail messages wondering if you're out there running or on the bike or whatever. You mentioned collaboration. Why is that so important in maintaining a fitness program? GUPTA: Well, you know for some of the reason you say, you know, you send me those e-mails and you make me accountable for my action and my fitness. I think, you know, with the media and the sort of element that we have, providing online partners, either digitally or on television, holding people accountable. If you share your calendar for example with someone, they're going to call you up, and say hey, did you do what you said you're going to do, and we have found in all the research that we've done for "Fit Nation" that that is something that really works, holding people accountable in this way.
ROBERTS: All right. You know, I tell you, last year, I was really championing you in trying to do that New York City marathon and then you went and you broke your hand and couldn't do it.
GUPTA: I know.
ROBERTS: All better now. Next year, I will be riding you next year.
GUPTA: Sure.
ROBERTS: Sanjay, thanks so much.
GUPTA: All right.
CHETRY: Well, two twin brothers are going on a Craig's list date. Actually, it was their little sister's idea. Christine Walters can't do chores or baby-sit to make money because she has muscular dystrophy. So she devised a pretty ingenious plan. She's selling a date with her brothers, Ryan and Rob to raise some cash.
(BEGIN VIDEO CLIP)
KRISTIN WALTERS, SELLING BROTHERS ON CRAIGSLIST: So I called my brother, Rob, in Nevada. And I was like, what would you think of the idea of selling a date with you and Ryan?
ROB WALTERS, KRISTIN'S BROTHER: I'll do anything for my little sister. And a date to get her a little bit of money, you know, that's definitely not too much to ask to say the least.
(END VIDEO CLIP)
CHETRY: Wow. Sweet and not bad to look at. Christine plans to use the money to buy Christmas presents. So if you want a date with those twins, make sure you logon to Craig's list. Also you can join us tomorrow on AMERICAN MORNING, we're going to be talking to the two brothers and their sister and see how the plan and the auction is going so far.
Well, you've seen the shoe toss over and over again. But if you still can't get enough of it, wait until you see how much fun the world is having poking fun over this flying pair of shoes. Jeanne Moos has a look. It's 55 minutes after the hour.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
CONAN O'BRIEN, HOST, "LATE NIGHT WITH CONAN O'BRIEN": The man who threw his shoes at President Bush is being hailed as a hero in Iraq. Yes. In fact, when he dies he'll be greeted in heaven by 72 podiatrists, a little something there.
(END VIDEOTAPE)
CHETRY: Everyone's cracking jokes about the shoe attack on the president. CNN's Jeanne Moos is gauging the size 10 reaction.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN CORRESPONDENT (voice-over): The weapons of mass destruction finally surfaced. And we in the press couldn't get enough.
HEIDI COLLINS, CNN ANCHOR: Nearly Bush whacked in Baghdad.
MICHAEL WARE, CNN CORRESPONDENT: Talk about reinventing duck and cover.
MOOS: Duck was all over the covers of newspapers. There were good puns.
UNIDENTIFIED MALE: Shoe-icide attack.
MOOS: One we had to struggle to get turns out shoe-nibomber is a playoff of the unibomber. At Vino (ph) shoe repair, President Bush image got polished.
UNIDENTIFIED MALE: I thought he was deft and agile.
UNIDENTIFIED MALE: He's very graceful. I didn't know he had it in him.
UNIDENTIFIED MALE: Oh, yes. That's a pretty good dodge all right.
UNIDENTIFIED FEMALE: Dodging and weaving, I mean, he has done that through his whole administration but we've never actually seen it filmed.
MOOS: Critics loved seeing it.
UNIDENTIFIED FEMALE: I would have liked to do it myself.
UNIDENTIFIED MALE: I think he threw one for the world.
UNIDENTIFIED FEMALE: He deserves it.
MOOS: Good thing it wasn't a FEMALE shoesuicide bomber.
MOOS (on-camera): This would have been a perfect shoe to throw at someone.
MOOS (voice-over): The first movie clip people everyone thought of was Austin Powers.
AUSTIN POWERS: Who threw this shoe.
MOOS: Next thing you know on YouTube, Austin Powers, George Bush hybrids bloomed.
AUSTIN POWERS: Who threw this shoe? Honestly? You fight like a woman.
MOOS: Instead of shoes, Saddam Hussein's head was thrown and the three stooges were edited into the act. In no time at all there was a Bush shoe target purse. Even the official George W. Bush shoe throw game, try to hit the president with a shoe.
MOSO: Would you dare toss these shoes?
UNIDENTIFIED FEMALE: Those are expensive. I wouldn't throw them.
MOOS: And now, the Secret Service, don't like their reaction?
UNIDENTIFIED MALE: They were having cigarettes and coffee.
UNIDENTIFIED FEMALE: How do you throw two shoes at the president?
MOOS: As for the now famous shoes should end up?
UNIDENTIFIED MALE: I think they should be impeached along with Bush.
UNIDENTIFIED FEMALE: They probably should go with the Smithsonian or something.
UNIDENTIFIED FEMALE: You know how you can bronze baby shoes.
MOOS: Yes.
UNIDENTIFIED FEMALE: Bronze it.
UNIDENTIFIED FEMALE: Maybe they should auction it off to raise money for the car industry.
MOOS: Actually, they're being held as evidence. It could have been worse if the Iraqi had done what this minor league manager did, not shake his shoe, but say, you stink, an armpit offensive. Jeanne Moos, CNN, New York.
(END VIDEOTAPE)
ROBERTS: I could just imagine the next White House press conference though, all the reporters will be sitting there in their socked feet.
CHETRY: Yes. They're going to pat around in their -- they got to get grippers to the bottom of those socks so they don't slip.
ROBERTS: Who knew? Who knew?
That's going to do it for us. Thanks so much for joining us on this AMERICAN MORNING.
CHETRY: And we'll see you back here tomorrow. Meanwhile here's "CNN NEWSROOM" with Heidi Collins.
