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American Morning: Wake Up Call
It's Wednesday: No Deal Yet; Memphis Schools May Start On Time; Hearing In Andrews' Stalking Lawsuit; Report: DOJ Probe Of Wells Fargo
Aired July 27, 2011 - 05:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ALI VELSHI, CNN ANCHOR: Good morning. It is Wednesday, July 27th. This is your A.M.: WAKE-UP CALL.
I'm Ali Velshi joining you live this morning from New York. It is 5:00 on the East Coast.
Debt, deadline and deadlock, maybe some dread as well. There is no deal in the debt ceiling debate.
A vote on House Speaker John Boehner's plan was supposed to happen today. We're just learning that it is not going to happen -- didn't quite cut it basically. The Congressional Budget Office says that Boehner's plan did not offer the spending and deficit cuts that Republicans thought it would.
CNN's chief White House correspondent Jessica Yellin spends the next 18 seconds giving us the big picture.
(BEGIN VDIEO CLI)
JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: What's happening now is Democrats are waiting. They're just waiting to se what happens with the Republican's bill before making their own move in the Senate.
But the big picture here is neither the Republican's bill in the House, nor the Democrats' bill in the Senate, seems to have the votes to get through both houses of Congress. So, we're back at stalemate.
(END VIDEO CLIP)
VELSHI: And so, it's Wednesday and there's no deal. The deadline is Tuesday of next week. If Congress can't get it done by then, you could start to see higher interest rates, a declining dollar and other problems.
OK. The White House Web site has put up a chart that breaks down the U.S. debt by administration over the last 10 years. It's interesting. I was just looking at it.
More than $3.5 trillion because of changes to the economy, not policy changes, but, you know, less tax income and things like that. The two wars, tax cuts, TARP, the so-called bank bailout, the stimulus, it's all listed there.
It's worth checking out if you have some time. Don't worry, it's safe for work. We do love our charts.
A federal grand jury in Alabama has indicted a man for allegedly threatening to kill President Obama. The 21-year-old suspect is a native of Uzbekistan. Authorities say he not only made threats but he also got his hands on some grenades and a machine gun. He'd been living in an extended stay motel outside Birmingham, Alabama. His next extended stay could be in prison with a very late checkout.
A Democratic congressman protecting the president's immigration policies found himself in the custody of U.S. Park Police. Representative Luis Gutierrez of Illinois was part of a rally against deporting illegal immigrants. He and other protesters sat down in a place where they were supposed to be kept moving which won him a pair of plastic handcuffs, a ride in a van, and a $100 fan. However, he managed to get back to the House, to the floor for the last vote of the day.
Congressman David Wu of Oregon, the man who said he wouldn't resign, yes, he's resigning. The seven-term Democrat says he's out of the House after the debt ceiling issue is resolved which means he could be there for a long time. Wu has been accused of making unwanted sexual advances towards the daughter of a campaign donor. Nancy Pelosi has called for an ethics investigation.
Well, this show has been Casey Anthony-free for several days now. The streak was short and now it's over. This won't take long, I promise.
The judge in the case is waiting until late October now to release the names of jurors. Florida law requires him to make the list public. But he says America needs a, quote, "cooling off period," first. He's apparently afraid for the jury's safety which gives you an idea of how hot the hate affair with Ms. Anthony is still burning.
Time now to check on the world markets -- the Hang Seng and Nikkei, they both closed down. The DAX and FTSE trading down right now.
Let's go to Nina Dos Santos live in London.
Nina, you are ahead of everybody on this. You are now. You've been looking at bond yields. Now, you're looking at currencies and how people are shifting out of the dollar out of concern for what might happen into other currencies. Tell me what you're seeing.
NINA DOS SANTOS, CNN INTERNATIONAL CORRESPONDENT: They are, indeed.
Well, over the course of the last 30 years or so, of course, the U.S. dollar has been the traditional safe place to put your money, hasn't it, Ali? But that seems to be changing as everybody gets increasingly concerned about the potential risk of a technical default by the United States.
One of the beneficiaries has been the markets of gold. Obviously, gold is traditionally the safe haven. And it's now surpassed yet another record just this week, exceeding $1,623 an ounce.
But what some traders have been telling me, Ali, is at that price, it's already a rather expensive investment. And that's one of the reasons why people are taking their dollar money out of the dollar and also putting it into other currencies that are deemed particularly safe. Notably the Swiss franc which has risen to another record against the green buck and other interesting currencies further afield such as, for instance, the Aussie dollar, that are backed by significant commodities.
Effectively, you can kind of buy into the precious metals themes and other metals themes by investing in the money rather than the expensive metals themselves. The Aussie dollar has risen to a 30-year high against the green buck and just keeps on rising.
But I should also point out, Ali, that a strong currency isn't necessarily good news, particularly if you are a significant export- driven market. Japan is suffering exactly this fate. The yen has traditionally been a pretty safe and strong place to put your money. The yen has been steadily rising against the U.S. dollar and rising yet again. That is not good news for car makers like Nissan and Toyota because it means that when they sell cars in the United States and repatriate that money they make fewer money for U.S. dollar sales.
VELSHI: Right. And Nissan actually has just come out moments ago with its quarterly earnings. They've done well, a nice recovery from what's gone on in Japan. But you're absolutely right, for exporting countries this isn't great news.
Nina, what's, people keep telling me the U.S. dollar is still the reserve currency of the world. Is that likely to change?
DOS SANTOS: Frankly, of course, it's not likely to change in the next, let's say, 10 years or so, unless something completely off the wall happened because a number of the world's most significant economies have their economy pegged on the U.S. dollar, notably, the Hong Kong dollar, et cetera. Even China has been a significant buyer of U.S. treasuries, holds no less than $1.2 trillion of U.S. treasuries. And it keeps its currency low by carrying on buying the dollar and frankly that situation, Ali, isn't likely to change, even if the U.S. does enter a technical default.
But, then again, what we should remember is that they're going to be issuing more money, aren't they? And the appetite for U.S. debt may be just little less after all this.
VELSHI: All right. I like the fact you're pointing out technical default. It's a term that we're going to be discussing a lot over the course of the next few days.
Nina, thanks for keeping on top of that for us -- Nina Dos Santos in London.
All right. No one has to tell you that it's been hot in the United States. Nice and cool this morning on the East Coast. But it's still hot in parts of the country.
Before we go to meteorologist Rob Marciano, just how hot has it been? I'll let Jay ;Leno do the talking.
(BEGIN VIDEO CLIP)
JAY LENO, "THE TONIGHT SHOW WITH JAY LENO": It is so hot, it is unbelievable out.
UNIDENTIFIED MALE: How hot is it, Jay? How hot?
LENO: It is so hot -- at the nude beach, attractive people were taking their clothes off. That's how hot it was. That's hot.
(APPLAUSE)
LENO: It is so hot Justin Timberlake said forget benefits, I want to meet friends with air conditioning. That's how hot.
(APPLAUSE)
LENO: It was so hot in New York, the Yankees actually work up a sweat beating the Mariners. That's how hot it was.
(END VIDEO CLIP)
VELSHI: Let's go live to Rob Marciano live from Atlanta.
You know, Rob, I actually tweeted as I was walking into work this morning what a great feeling it was to walk into work in Manhattan in this beautiful, almost late spring, early fall-type weather. But temperatures are still above 100 in the belly of the country.
ROB MARCIANO, AMS METEOROLOGIST: Yes, that warm air, Ali, is going to be coming back up towards the Northeast as we get closer to the weekend. So, today and tomorrow, enjoy the cool and low humidity.
Across Southern Plains and Texas, another day where heat indices are going to be up over 105, 110 in some cases. Heat warnings are posted for some of these areas, in places like Dallas and Oklahoma City continue to see temperatures measured in the shade without the humidity up and over 100.
So, the actual temperature forecast for the day is 105 for Dallas, 105 for Oklahoma City. For both of those cities, that means two dozen days in a row where temperatures have exceeded the 100- degree mark. Not a record for Dallas yet, but it may very well be soon.
So, we have drought issues across Texas. So, a tropical system heading that way wouldn't necessarily be bad news, depending on the strength. We're watching this item of concern heading towards the Yucatan Peninsula and into the Gulf of Mexico. It looks like it's going to become our next tropical depression, potentially next tropical storm. And, right now, forecast models are bringing whatever it will be towards the Texas coastline as we get closer to the weekend, where exactly obviously we don't know yet. But Texas coastline, Louisiana coastline, you're all be threatened by this thing.
It would be nice if we got it to be a weak to moderate tropical storm, Ali. Then it would bring beneficial rains to extremely drought-stricken Texas.
VELSHI: How bad could it get? What's the --
(CROSSTALK)
MARCIANO: Until we get it into close circulation and deem it to a tropical storm, the models do a horrible job figuring out how strong it's going to be.
VELSHI: Any flight delays this morning?
MARCIANO: Not at the moment, especially across the Northeast. It's going to be pretty nice. We do have volcanoes that we're dealing with across parts of Alaska and Chile, the latest of which is with this picture.
Do we have it? Show that beautiful volcano footage.
We'll get it for you the next half hour.
VELSHI: I was going to go say, this is as good it gets. The morning volcanoes on CNN -- you and me, Rob.
We'll get those pictures for the next time we talk. Good to see you, my friend. Rob Marciano in the extreme weather center.
Hey, listen, you've probably all heard bout the fact that Web sites and phone lines are jammed or were jammed yesterday at Congress -- constituents complaining about their frustrations over the debt ceiling debacle. If that's not getting through to the president and lawmakers, listen to a message with a different beat. I'm going to show you on the other side of this. It's going to be interesting.
But, first, here's our quote of the day. "Sanity will prevail." Find out which newsmaker said this about the debt crisis.
It's 10 minutes after the hour.
(COMMERCIAL BREAK)
VELSHI: Thirteen minutes after the hour.
Now, back to the quote of the day, quote, "Sanity will prevail," end quote. White House Press Secretary Jay Carney said this about the debt talks to CNN's Piers Morgan last night.
(BEGIN VIDEO CLIP)
JAY CARNEY, WHITE HOUSE PRESS SECRETARY: We are confident. The president is confident that, if you will, sanity will prevail, that while there are certain members of Congress who seem to think that defaulting on our obligations for the first time in our history wouldn't be such a serious thing, we couldn't disagree more strongly. And those folks we believe are in the minority, that most of the elected members of Congress understand that there is no option here, that we have to take the necessary action to ensure simply that we pay the bills that we've already run up.
(END VIDEO CLIP)
We'd like to give you a lot of different views. You just heard from the White House.
Now, here's comedian Jon Stewart giving his response to those dueling speeches a couple of nights ago from the president and House Speaker John Boehner over the debt stalemate.
(BEGIN VIDEO CLIPS)
JON STEWART, "THE DAILY SHOW WITH JON STEWART": You know, I think your financial austerity path message may be slightly undercut by the begolden shared red carpet path you walk down to tell us about it. Isn't there any way to do the tighten-the-belt speech from a room that doesn't look like the foyer of the Vatican? Just saying if Willy Wonka had to address America's chocolate shortage, he might not do it from the waterfall room.
The Republican response, which came from the world's saddest tangerine.
REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: The bigger the government, the smaller the people.
STEWART: Wait, bigger government, the smaller the people. That means the smaller the government, the bigger the people. Which means if we get rid of government, we'll have giant people!
(END VIDEO CLIPS)
VELSHI: All right. Time now for your Political Ticker with Tim Farley, host of "Morning Briefing" on Sirius XM POTUS live.
Glad we had Jon Stewart to make it funny for us because it's no laughing matter. We're less than a week away from this debt ceiling deadline. And, Tim, the news is that the House has delayed the vote. Speaker Boehner said two nights ago he was going to have a plan ready to vote on. Now, it's being delayed until tomorrow.
TIM FARLEY, HOST, "MORNING BRIEFING," SIRIUS XM POTUS: For those that who don't know, the bill has to be scored in the Congressional Budget Office which does this, found out it didn't quite make the numbers that he thought. And he also had a numbers problem within the Republican Caucus. He can't get enough Republican votes. So, he's going back, if not to square one, at least to square three maybe and to try to rewrite this bill.
And part of this, Ali, is sort of the House and the Senate waiting to see who goes first because then the other can follow. It's not quite clear that either the Senate or the House bill -- even if it's rewritten -- are going to be able to make it through. It may be some sort of compromise.
We may even -- believe it or not there are cynics in D.C. who think this can happen -- we may wind up on Monday and having one of these one-line votes just to raise the debt ceiling after all of this. It staple remains to be played out.
VELSHI: Which is exactly what a whole bunch of people said we should have done in the beginning, Tim.
FARLEY: In the first place, yes.
VELSHI: There's actually some other business going on Washington today. I really wish everybody in Washington were this up in arms about the jobs crisis.
But the Senate Finance Committee is actually going to be talking to the biggest employers in the country about jobs today.
FARLEY: Absolutely. And when you talk about companies like Wal-Mart, which will be represented by their CEO, that's Michael Duke, Thomas Falk from Kimberly-Clark, Gregory Lang from PMC-Sierra and Larry Merlo who is with CVS Caremark.
These are people who obviously have a lot of people working for them and a lot of people do business with these companies. So, today, they're looking at taxes and how that affects business and hiring. And this at least is relevant to a lot of people's lives, maybe more so than the debt ceiling. Although it seems like more and more, the debt ceiling is getting into the vernacular every day. People are starting to talk about this more and more.
VELSHI: And, finally, some people are just giving up on talking about it altogether. Why not rap about it? A rapper tells Washington to raise the debt ceiling. Let's listen to this together.
(VIDEO CLIP PLAYS)
VELSHI: He's keeping the message simple, Tim.
FARLEY: Yes, he is. He's cumulonimbus, from what I understand, he makes it rain. That's one of the signs that -- when you get a rap song like this, grand master Ali, in the American vernacular, once you've done that, you've probably hit a mainstream issue.
I'm not sure if it's going to be on the hot 100 or not.
VELSHI: It's pretty Phat Tim, P-H-A-T, phat.
(LAUGHTER)
VELSHI: Have a good one, my friend.
FARLEY: You, too.
VELSHI: Tim Farley, host of "Morning Briefing" on Sirius XM POTUS.
All right. Imagine if you could kiss your yearly flu shot goodbye with a single, universal long lasting vaccine. It could be in reach in the next five years, according to the chief of the National Institutes of Health.
As you know, the flu bug mutates every year. That's why you need to get jabbed annually. But this new type of vaccine would target the types of the virus that don't change, protecting you against all strains.
You learned something new last night but can't remember it this morning. Maybe you can blame the memory lapse on fragmented sleep. Stanford researchers studying mice found tat many awakenings throughout the night kept the mouse from committing something to memory. A wide range of disorders can lead to interrupted sleep, including sleep apnea, alcoholism and Alzheimer's disease. The only thing I don't understand about that story is what exactly a mouse has to remember.
A really cool use for the lowly PVC pipe, by the way, from a bunch of smart kids at Brigham Young University. They are using it to make artificial limbs. Students take the PVC, heat it, mold it, and voila, they are changing lives, sending them to developing countries. They've actually got a clinic established in Tonga.
(BEGIN VIDEO CLIP)
DOUGLAS WRIGHT, BRIGHAM YOUNG UNIV.: While we were there, we able to give away about 15 legs, or legs in the process of being made. And we have a list of 45 to 50 people who are ready for a prosthetic.
(END VIDEO CLIP)
VELSHI: The average cost for a PVC prosthetic, by the way, $25.
OK. A new way to tell if someone is on drugs is as closed as your fingertip. We'll tell you about it when we come back.
But, first, every day on this show, we let you know what national day it is. Today is the most random one we've had. Today, July 27th, is Take Your Pants for a Walk Day.
And when you take your pants for a walk this morning, you got choices. You can wear slacks, britches, sweats or short pants, which you might want to do. I'd recommend that you're in your pants when you take them for a walk.
It's 19 minutes after the hour.
(COMMERCIAL BREAK)
VELSHI: It is 22 minutes after the hour.
Here are three things to have on your radar today:
At 10:00 Eastern, some of the country's top CEOs answer questions from the Senate Finance Committee. They're going to be asked to talk about jobs and economic growth.
At noon, the Tea Party Express hosts a rally on Capitol Hill to pass the cut, cap and balance bill which has no chance of getting through the Senate and no chance of getting signed by the president. GOP candidate Herman Cain, however, is going to address the crowd.
And we are watching and waiting for the latest out of D.C., what happens next as lawmakers remain at an impasse on a debt ceiling deal and does the U.S. debt get downgraded. We'll before back to that shortly.
Now, let's go around the world with Zain Verjee. She is live in London.
Good morning, Zain.
Boy, what a story. A 14-year-old American teenager is found guilty in a Mexican court of be heading at least four people, kidnapping three others.
What do you know about this?
ZAIN VERJEE, CNN INTERNATIONAL ANCHOR: Exactly. He's a U.S. citizen, only 14 years old. He was asked why did you do this and how did you do this.
Listen to what he said.
(BEGIN VIDEO CLIP)
QUESTION: How may have you killed?
TEENAGER: Four.
QUESTION: How did you execute them?
TEENAGER: Huh?
QUESTION: How did you execute them?
TEENAGER: I slit their throats.
(END VIDEO CLIP)
VERJEE: He's going to be spending three years in a correctional facility. A lot of people would be asking, only three years? But under Mexican law, that's the maximum sentence that he can get because he's only 14 years old. He's also got to pay a fine of $400,000.
Many are saying this is the work of the drug gangs that are now hiring minors and young kids to do their dirty work for them -- Ali.
VELSHI: All right. And Afghanistan, tell us about this, Zain, launching a new TV show called "The Ministry." And from -- I haven't seen, but from people I've talked to, they say it seems like the Afghan version of "The Office."
VERJEE: Yes, that's exactly what it's supposed to be, the Afghan version of "The Office." They're even going to shoot it in the same way, and kind of this loose documentary format style, too.
But what they're saying is they're not just dealing with an office scenario, because they're going to be focusing on the ministry of garbage, but they want to focus on important Afghan issues like corruption. So, that is going to be a show to watch if you're in Afghanistan. It's going to be on the main local commercial TV channel there.
And speaking of shows, Ali, I was watching "The Daily Show," guess who popped up. Take a look at this picture. Jon Stewart comparing -- yes, Ali Velshi to -- oh, no, an egg.
VELSHI: Uh-oh! An egg with glasses.
VERJEE: Good glasses. Yes. Exactly.
VELSHI: You know --
VERJEE: I just want you to know I took offense to this, Ali. This kind of upset me. I really didn't think that it was fair.
So, I actually thought this was better. Take a look at what I came up with.
Ali as the moon.
VELSHI: OK.
VERJEE: Or how about Ali as watermelon.
VELSHI: Nice.
VERJEE: Or -- this one is my favorite. Ali as baseball.
VELSHI: Oh, that is good.
VERJEE: Come on.
VELSHI: Egg has no personality.
Zain, you definitely captured the essence of me better than Jon Stewart did.
Zain, what a pleasure to see you as always. I've talked to you in just a little while. Zain Verjee in London.
There is a bit of a resemblance to an egg, I have to say.
All right. A new way to tell if somebody is under the influence of drugs -- a fingerprint.
A British company developed a devise that analyzes the sweat pours in fingertips to detect the presence of drugs. The news of the device was announced at a conference in London last week. There's no word when it will be used at a traffic stop near you.
Researchers in Georgia Tech say they've been able to harness power from thin air, literally. You know all the invisible radio waves around us? The researchers captured that electromagnetic energy. They store it, it builds up to power, things like sensors or micro processors. That's neat and scary at the same time that there's so much stuff running around us.
All right. Time for the "Businessman Special": dirty hotels. We have the dirtiest hotels list from trip adviser coming up after this quick.
It's 26 minutes after the hour. That's gross.
(COMMERCIAL BREAK)
VELSHI: Good morning. It's Wednesday, July 27th. This is your A.M.: WAKE-UP CALL.
I'm Ali Velshi, joining you live this morning from New York. It's 30 minutes after the hour.
It's like debt ceiling deja vu. Democrats fighting Republicans, Republicans fighting Republicans -- still no deal while the clock ticks closer to August 2nd. That's the day the U.S. can no longer pay all its bills.
House Speaker John Boehner is scrambling to make last-minute edits to his proposal, because the numbers he proposed just didn't add up. His plan for a two-step debt limit hike is under fire from the left and from the right.
(BEGIN VIDEO CLIP)
REP. MICHELE BACHMANN, (R) MINNESOTA: This Republican will not vote to raise the debt ceiling. I will not do that.
REP. JIM JORDAN, (R) OHIO: We advocated something much more in the budget plan that the House passed. So, we can get there (ph) real palms with this plan.
SEN. HARRY REID, (D) MAJORITY LEADER: Democrats will not vote for it. Democrats will not vote for it. Democrats will not vote for it. It's dead-on-arrival in the Senate.
(END VIDEO CLIP)
VELSHI: The House vote on the plan has been pushed from today to tomorrow, but the world is watching. Global markets are watching, and they're wobbling. And IMF chief, Christine Lagarde, is nervous.
(BEGIN VIDEO CLIP)
CHRISTINE LAGARDE, IMF MANAGING DIRECTOR: I am worried because this debt ceiling issue has not been cracked.
(END VIDEO CLIP)
VELSHI: By the way, you can hear more of Christine Lagarde's very important interview with Fareed Zakaria this Sunday at 10:00 a.m. and at 1:00 p.m. Eastern on "FAREED ZAKARIA GPS."
School kids in Memphis may be heading back to class on August 8th as scheduled. They start early in Memphis. The start date had been in limbo because of a money spat. Basically, the school board threatened to delay the academic year until it got $55 million from the city, but overnight, board members decided to let schools start if the city meets a few conditions, including a $12 million payment which is due on August 5th.
Sports reporter/stalking victim, Erin Andrews, is taking her convicted stalker to court along with several hotel chains. There's a court hearing this morning. She filed suit in Illinois earlier this month. Andrews accuses the hotels of negligence, invasion of privacy, and emotional distress for giving Michael Barrett access to rooms right next to hers. Barrett pleaded guilty to stalking the ESPN reporter, and he was sentenced to 30 months in prison.
Wells Fargo lending practices are reportedly under the microscope of the justice department. "Huffington Post" says the bank is the target of a new probe for allegedly taking advantage of African- American borrowers during the housing bubble, steering them into high- cost subprime loans. Wells Fargo is the nation's biggest home mortgage lender.
Well, my homeland, Canada got some special love from Stephen Colbert. Why? Because he's made a bucket list ahead of the debt ceiling deadline next week, you know, just in case.
(BEGIN VIDEO CLIP)
STEPHEN COLBERT, HOST, THE COLBERT REPORT: Before our society collapses into roving cannibalistic motorcycle gangs, I've always wanted to try bubble tea.
(LAUGHTER)
COLBERT: It looks fun. It surprises, tasty little balls there. Also, we should invade Iran.
(LAUGHTER)
COLBERT: We know it won't be a quagmire because we've got to be out by next Tuesday.
(LAUGHTER) COLBERT: And we should finally just do it with Canada. The tension has been building for years. I'm talking crazy last night on earth, grabbing borders, slapping rockies half in French, no eye contact, eating Putin out of each other's Great Lakes --
(LAUGHTER)
(END VIDEO CLIP)
VELSHI: And you've heard me say before, Putin, Christine, is one of my favorite foods, it's French fries with cheese curds which you know something about coming from the Midwest with sort of burnt gravy on top of it, but, you know, that's for another time. Christine Romans back talking about business with us.
Christine, let's talk about markets. You know, it's not just the debt ceiling. There are actually companies reporting their earnings, how they're performing, and hopefully, somebody is paying attention to that. I know you are.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: I definitely am. It's interesting because it's the macro and the micro. You've got this big sort of political crisis. At the same time, these companies are telling us how they're doing and how the market and the economy is faring for them. So, today, we get (ph) a lot more earnings. Conoco Phillips. We're still hearing from these oil companies. We heard from BP yesterday said that it had swung to a profit.
Boeing, we'll hear about this one. Also, Delta and Visa, the credit card company. So, all of these are among the companies that will be reporting here today. And I'm going to tell you, the bottom line is that many of these companies are reporting that the economy is getting better, but the clarity is something that they don't have. And we still aren't seeing all that hiring.
So, still kind of this jobless recovery. Same story. Their futures are flat this morning, Ali. Flat and the bigger picture still, what's going to happen with the debt talks and the merger with Canada, according to Stephen Colbert.
VELSHI: Why do you sound so funny this morning?
ROMANS: I know, I have a little bit of a cold. I'm sorry about that. You know, when you get up so early in the morning, you don't realize it until I come and talk to you. And I'm like. Oh wait, I have cold.
VELSHI: It's adorable.
(LAUGHTER)
VELSHI: In California, you know, a lot of states are having -- they're worried about what's going to happen if there is a problem with the debt ceiling. California is making some plans ahead of it. Tell us what they're doing. ROMANS: It has secured almost $5.5 billion loan from a bunch of different banks to make sure it has the cash on hand to cover any kind of shortfall from federal financing. You know, something that many of you might not know out there. The federal government last year paid some $478 billion to states and even just next week or next month, rather, states are expecting to get just in tuition assistance about $10.5 billion.
If you got a default and you got the treasury department deciding which bills to pay and which states to pay and what kinds of things to be laying out money for, some states are now trying -- starting to wonder how they're going to be able to cover the federal part of their financing. Interestingly, though, we're going to talk to the Florida governor later on this morning who says not a problem for us.
In fact, we don't think there's any problem if the United States doesn't raise the debt ceiling. So, at least, one governor bucking the trend while California is trying to make sure it has cash on hand.
VELSHI: It's a minority view that we're not going to be in trouble.
ROMANS: It sure is.
VELSHI: We will hear from him. Christine, I'll see you on "AMERICAN MORNING."
ROMANS: Yes.
VELSHI: Twenty-five minutes. Christine Romans.
ROMANS: Yes, you got it.
VELSHI: Talk about business this morning.
Let's talk about our businessman special. Trip adviser is out with its dirtiest hotels list. Here are the top five for you, travelers. Grand Resort Hotel and Convention Center in Pigeon Forge, Tennessee. Eighty-eight percent of reviewers did not recommend this hotel on trip advisors Web site. The Jack London Inn in Oakland, California, got a thumbs down, 79 percent of the time.
Desert Inn Resort In Daytona Beach is next on list, 81 percent said they would not recommend this hotel. We've got Hotel Carter right here in New York City. And rounding out the top five list was Polynesian Beach and Golf Resort in Myrtle Beach, South Carolina.
All right. Govern yourselves accordingly, but first, here is today's "Get Smart" question in honor of the debt ceiling debate, how many checks does the U.S. government send out every second according to the president? Six, 18 or 27? The answer after this quick break. It is 36 minutes after the hour.
(COMMERCIAL BREAK)
VELSHI: It's 40 minutes after the hour. Now, back to today's "Get Smart" question. How many checks does the U.S. government send out every second? Six, 18 or 27? The answer is 27. That's according to President Obama. That number came from one of his many speeches on the debt debate when he said that the government sends out 70 million checks every month. Now, 'The Washington Post" says that numbers actually too low. It doesn't include Medicare payments, food stamps, and most of the spending done by the Department of Defense.
Time now for our "Political Ticker." Let's bring in Joe Johns live from Washington. He's covering everything that's going on there. Joe, less than a week away before the debt ceiling deadline, we were at least going to see some movement on the part of the House. John Boehner's proposal was supposed to be ready. It's not being delayed until tomorrow.
JOE JOHNS, CNN SENIOR CORRESPONDENT (on the phone): Yes. And, this is one of those things you're watching sausage made on Capitol Hill, Ali. You can look at this thing as an embarrassment for the speaker. However, the whole thing is an embarrassment for the U.S. government. According to sources, the speaker had to postpone this vote because the people who crunched the budget numbers said his plan wouldn't create the savings he was looking for.
He said his plan would add up to something like more than a trillion dollars. The Congressional Budget Office said it only got up to about $850 billion. This is actually not really that bad of news for Boehner because he's having real problems trying to get together the support from Republican colleagues to pass whatever he puts on the floor at the end of the day. He gets an opportunity more or less to buy some time and round up the votes to try to get something passed on the floor of the House.
Meanwhile, at the top of this hour, I think you talked a little bit about the sniping that's going on from Democrats. They don't think the thing is going to pass, but if you read between the lines, really, it does appear that at least the Congressional leaders seem to be moving closer together. The question is whether they can get the votes they need to pass something out of the House and the Senate that the president will sign. And, you know, that's the bottom line.
VELSHI: All right. I know you're going to be watching it carefully. You're also going to be watching the credit reports, the credit agencies' testimony today. Joe, thanks very much for that. We'll stick with you through the course of the day. Joe Johns in Washington. It is 42 minutes after the hour.
Here are three things to put on your radar.
At 10:00 a.m. Eastern, some of the country's top CEOs answer questions from the Senate Finance Committee. They're going to be asked to talk about jobs and economic growth.
Then, at noon, the tea party express holds a rally on Capitol Hill to push for the cut, cap, and balance plan which has no chance of passing the senate, no chance of getting signed by the president. However, GOP candidate, Herman Cain, is set to address the crowd. And we are watching and waiting as is Joe Johns and all the rest of our best political team on television for the latest out of D.C., something, anything. What happens next as lawmakers remain at an impasse on the debt ceiling debt deal, and, are we going to face a downgrade of U.S. debt? We're on top of it.
Nature, by the way, apparently picked a really bad time to call the coach. The quarterback coach for the University of South Carolina got arrested. The accusation? Relieving himself outside a restaurant right smack in the middle of downtown Greenville. Police say George Magnus (ph) was drunk and uncooperative, but at least, he didn't play the "don't you know who I am" card. Magnus has been suspended from his coaching duties until all this get straightened out.
The national past time goes way past bedtime last night or this morning and ends on a very controversial call. Braves versus the Pirates. The game lasted nearly 19 full innings, six hours and 39 minutes. It ended with a controversial play at the plate that makes you wonder if the lateness of the hour made the umpire's eyes a little blurry. The Braves won the Pirates (INAUDIBLE).
And if you watched the whole game, I can't imagine you're not watching me right now, but you're going to be pretty worthless today. I have a game to go to later on today, Yankees game. I can't afford a six-hour game. It's going to have to be a lot shorter than that.
Before we go, if you're making a call overseas this morning or checking out some websites based on other countries, you have this day in history to thank. Back in 1866, communication was established between the United States and the United Kingdom using a telegraph cable across the Atlantic. It all started there. Forty-four minutes after the hour.
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VELSHI: Good morning. It's Wednesday, July 27th. This is your A.M. WAKE-UP CALL. I'm Ali Velshi joining you live this morning from New York. It is 47 minutes after the hour.
Let's go around the world with Zain Verjee live from London. Zain has been following developments after the Norway attacks. Zain, a girl caught in the middle of the attacks was updating her mom via text message. It's gut-wrenching to read those messages.
VERJEE: It really is. Pretty dramatic stuff. Her mom was elsewhere and the daughter, Julie, was at the camp in Norway on Utoya Island. Let me just give you an idea of what they actually texted each other. Julie says, "Tell the police there is a madman running around and shooting people. They must hurry." Then, her mother replies, "The police know. They've had many calls."
Julie, "We are in fear of our lives." Her mother responds, "I understand that very well, my darling. Just stay hidden. Do not move anywhere." What happened, Ali, was that Julie heard the gunshots go off and saw the gunman in a police uniform and said she basically ran to the water along with some other people, and they hid behind a big overhang, behind a rock and then was texting her mother and just kept saying I love you, I'm so sorry for all the times I was bad.
You know, I'll be much better. I love you. So, it was emotional. It was dramatic. She ended up being OK, but five of her best friends were killed -- Ali.
VELSHI: It just must have been tragic, tragic to know -- to see that. I'm glad she's OK, but so many others weren't. Zain, thanks very much for that. We'll catch up with you on "American Morning" in about 12 minutes.
All right. Debt, deadline, and deadlock, maybe even dread, they're all part of the drama that the debt ceiling debate is creating. A vote on House Speaker Boehner's plan was supposed to happen today. It's not happening today. It might happen tomorrow. It turns out that his plan didn't quite cut it.
The Congressional Budget Office said it didn't offer the spending and deficit cuts that Republicans thought it would. CNN's chief White House correspondent, Jessica Yellin, spends the next 18 seconds giving us the big picture.
(BEGIN VIDEO CLIP)
JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: What's happening now is Democrats are waiting. They're just waiting to see what happens with the Republicans' bill before making their own move in the Senate, but the big picture here is that neither the Republican's bill in the House nor the Democrat's bill in the Senate seems to have the votes to get through both Houses of Congress so we're back at stalemate.
(END VIDEO CLIP)
VELSHI: Back at stalemate. It's Wednesday, no deal. The deadline is Tuesday of next week. If Congress can't get it done by then, you could see higher interest rates, a declining dollar, other problems, including having to do with your stocks. The White House website has put up a chart that breaks down the U.S. debt by administration over the last ten years.
More than $3.5 trillion because of changes to the economy alone, meaning less tax coming in, the two wars, tax cuts, T.A.R.P., the so- called bailout, they're all listed there. Check it out if got some time. It is safe for work, and we love our charts.
A federal grand jury in Alabama has indicted a man for allegedly threatening to kill President Obama. The 21-year-old suspect is a native of Uzbekistan. Authorities say he not only made the threats, but he also got his hands on some grenades and a machine gun. He'd been living in an extended stay motel outside of Birmingham. His next extended stay could be in prison with checkout many years later.
The Democratic congressman protesting the president's immigration policies found himself in the custody of U.S. park police. Representative Luis Guiterrez of Illinois was part of a rally that was against deporting illegal immigrants. So, he and some protesters sat down in a place where they were supposed to keep moving, and that won Guiterrez some plastic handcuffs, a ride in that van and a $100 fine. He did manage, however, to make it back to the House floor in time for the last vote of the day.
Congressman David Wu of Oregon, remember him, the man who said he wouldn't resign? Yes, he's resigning. The seven-term Democrat says he's out of the House after the debt ceiling issue is resolved. That means he could be there for a long time. Wu has been accused of making unwanted sexual advances toward the daughter of a campaign donor. Nancy Pelosi called for an ethics investigation.
When you're running for president, you got to have a bus, right? Jay Leno shows some of the candidates' super hot wheels.
(BEGIN VIDEO CLIP)
JAY LENO, HOST, THE TONIGHT SHOW WITH JAY LENO: Have you noticed you can tell how well a candidate is doing financially by the size of their tour bus. Have you noticed this? Yes, take a look what I mean. There's Mitt Romney's bus. That's pretty impressive. There's Michele Bachmann, that's a big bus, too. Tim Pawlenty, not so much.
(LAUGHTER)
(APPLAUSE)
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VELSHI: Let's go to Rob Marciano live in Atlanta. Rob, you showed me a tropical storm last time we talked that's developing. Tell me more about this.
ROB MARCIANO, AMS METEOROLOGIST: This thing is looking more interesting, and it will probably become a tropical depression before the day is done. They're going to fly an aircraft in there, hurricane hunter, to check it out later on today. It's between the Yucatan Peninsula and Western Cuba heading towards the Gulf of Mexico where waters are toasty. And so, intensification of this thing is likely here over the next 24 hours.
Here's what our computer models are saying right now preliminary forecast brings it somewhere in the Mexico, Texas, or potentially Louisiana Friday, Saturday or Sunday of this weekend. So, be prepared there. We'll have more updates throughout the day today, and certainly, at this time tomorrow morning. Speaking of hurricane flights, let's talk about air travel. Tampa, Orlando, Miami, Minneapolis, you'll see some thunderstorms today, but New York City will not.
It's going to be a lovely day with low levels of humidity. Temperatures were staying below 90 there, above 100 again in Dallas, Texas. A spot where it's awfully cool, the dark side of the moon or the far side of the moon where NASA's lunar orbiter discovered a couple of volcanoes over there, Ali. They're not the typical ballistic kinds. They're a little more mundane, rare kinds. This leads to some questions as to what was going on with the moon about three our four billion years ago and what was going on because of this discovery, I can't really tell you, but, cool pictures from NASA, and we thought we'd share them.
VELSHI: I've always wanted to know what was going on on the moon three or four billion years ago. Nobody has ever been able to give me a straight answer except for you.
(CROSSTALK)
MARCIANO: There is magna all over the place. It was a hot mess.
VELSHI: Parties, free love, people smoking.
MARCIANO: Like I said, a hot molten mess.
VELSHI: Hot, molten mess. Rob Marciano, check in with you on "AMERICAN MORNING" very shortly.
Hey, before we take a break, let's get a look at the day of the word. It is downgrade. Yes, you probably understand the concept, but I've got specific details on what happens if the U.S.' credit rating is downgraded right after this short break. Fifty-three minutes after the hour.
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VELSHI: Fifty-six minutes after the hour. Let's take a look at how the world's money is doing this morning. Carter Evans live from New York at the NASDAQ market site. Carter, forget the debt ceiling for a minute. There's actually a whole lot of stuff. There's economic reports and earnings that you're looking at. You're looking at futures. What's going on?
CARTER EVANS, CNN BUSINESS CORRESPONDENT: Well, our futures are actually up slightly this morning. We've got a lot of economic reports, some important ones. The fed's beige book survey of economic regions around the country. We've got the oil inventory report this morning. We've also got durable goods orders this morning. We've got a ton of reports coming today including a couple of big ones, Conoco Phillips and Delta.
In the meantime, let me show you what's trending here on CNNMoney.com. Of course, we're talking about the debt ceiling. That's going to be on the front page everyday. This is all back to the drawing board, but I also wanted to talk about Amazon. Amazon reporting after the close yesterday, Ali, sales up almost 51 percent from last year to about $10 billion.
Profit fell slightly, but it was still better than expected. If you look up above me here, I've got Amazon.com ticker in the pre market. It's up almost six percent right now.
And look at -- I got to tell you, Dunkin' Donuts, you couldn't talk smack about Dunkin' to people from the northeast, but honestly, it was a tired old fussy company, and it has gone through a real change in the last year, and now, it's going to IPO.
EVANS: So, the question, Ali, is, will Dunkin' Donuts be as popular in the rest of the country as it is in the northeast right now? That's what shareholders are certainly counting on. But CNNMoney has interesting story that throws iced coffee on the Dunkin' IPO today. They asked a question, is this really worth it or is this whole IPO all a sugar high and it will fade really quickly? They look at Dunkin's the finances to find out if it really is a good deal.
VELSHI: I certainly like their little flat breads there, their egg white flat breads, I'll tell you that. Carter, we'll check in with you later. Good to see you, my friend. Carter Evans at the NASDAQ market site.
Now, back to the word of the day, downgrade. Here is the official definition, reduced to a lower grade, rank or level of importance. Here's why it's important today. For dozens of years, U.S. debt was essentially a risk-free investment. There is now a risk of lowering what is, in essence, our credit score.
Mohamed El-Erian is the CEO of PIMCO. PIMCO is the world's largest bond fund. El-Erian is one of the most influential people in the bond universe, and here's what he had to say about why the risk of a downgrade is such a serious issue.
(BEGIN VIDEO CLIP)
MOHAMED A. EL-ERIAN, CEO, PIMCO: We have an economic system globally that is constructed on the basis of a strong core. And in the middle of this core, at the center of the center, is the AAA credit rating of the United States. So, the AAA credit rating holds together all sorts of things in the global system. If somehow we end up losing that AAA, then, we will see a lot of realignments that can be very, very costly.
(END VIDEO CLIP)
VELSHI: Congressional leaders won't stop their squawking over what to do about the debt ceiling, but could it be music to our ears? Here's your punch line.
(BEGIN VIDEOTAPE)
LENO: Something sounded familiar, and I just couldn't put it together. Well here.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Now, every family knows a little credit card debt is manageable.
REP. JOHN BOEHNER, (R) HOUSE SPEAKER: And the sad truth is that the president wanted a blank check six months ago, and he wants a blank check today.
OBAMA: For the last decade, we've spent more money than we take in.
BOEHNER: If you're spending more money than you're taking in, you need to spend less of it.
(CROSSTALK)
BOEHNER: God bless you.
OBAMA: God bless you.
BOEHNER: Your family.
OBAMA: God bless the United States of America.
BOEHNER: God bless the United States of America.
(APPLAUSE)
(END VIDEOTAPE)
VELSHI: At least someone can still laugh about it. "AMERICAN MORNING" starts right now.
