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LeBron Returns to Miami; Looking Back on the Year in Politics; How Did Retailers Fare this Holiday Season?

Aired December 26, 2014 - 06:30   ET

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

(COMMERCIAL BREAK)

CHRISTINE ROMANS, CNN ANCHOR: Welcome back to NEWSROOM this morning. Let's get right to Pamela Brown for some of the day's top stories.

Good morning.

PAMELA BROWN, CNN ANCHOR: Good morning. Happy Friday to you guys.

Well, seven people have been arrested, accused of making threats against the NYPD. Two of the suspects are accused of making threats to the precinct where the two officers killed last week were stationed.

And the wake for Officer Rafael Ramos public wake will be held today. He'll be laid to rest tomorrow. Meantime, the city's mayor is asking people to be on heightened alert to stop future cop killings.

And the United States and Jordan say the evidence is clear that ISIS did not shoot down the coalition plane in northern Syria. The pilot from Jordan has been taken hostage by the extremists. The Jordanian government insists he crashed. Meanwhile, in Iraq, the ISIS-appointed governor of Mosul has been killed by a U.S.-led air strike. Since August, the U.S. has conducted more than 1,300 airstrikes in Iraq and Syria, with the cost now topping $1 billion.

George H.W. Bush remains hospitalized this morning. The former president was taken to Houston Methodist Hospital Tuesday, suffering shortness of breath. A spokesperson said Thursday the 90-year-old had another terrific day and is in great spirits.

Earlier statements have said the elder Bush's prognosis is, quote, "very positive", and that doctors are keeping him hospitalized only as a precaution.

Reunited and it feels so good. This video has to make you smile. If it doesn't, I don't know, something's wrong with you.

The National Zoo's panda cup right here is back with her mom. After spending more than 24 hours in a tree, as we see, little one climbed up there after she panicked when she hit a hot wire in her yard. Designed to show animals their boundaries -- well, the panda bear, who just turned one in August, is said to be perfectly fine.

ROMANS: Like all small children when testing her boundaries, she freaked out and didn't do what anybody thought she would.

All right. Thank you, Pamela.

(CROSSTALK)

ROMANS: Yes, exactly. I saw that coming.

LeBron James took his talents back to South Beach for his first visit since leaving the Heat.

Brian McFayden has more on this morning's "Bleacher Report".

Hey, Brian.

BRIAN MCFAYDEN, CNN SPORTS: Hey, good morning, guys.

Yes, after winning two titles and four years in Miami, LeBron went home to Cleveland, and Christmas marked the first time he faced his former team. He was greeted with cheers and standing ovation by the Miami crowd. After the game, LeBron said he had buffering in his return and he got to reunite with his good friend, Dwyane Wade, although this time, only one of them would be going home a winner. LeBron scored 30 points, dished out eight assists, but it wouldn't be enough on this very emotional night, Heat win 101-91.

John Wall and Quincy Acy won't be exchanging Christmas cards any time soon. Instead, the two decided to exchange some pushes and shoves during the Wizards-Knicks game on Christmas. Wall took exception to a hard foul that sent him to the ground and he let Acy know about it, too. Pushing and shoving ensued. Cooler heads prevailed, but Acy was ejected from the game for his role in the incident. The Wizards went on to win, 102-91.

And if you ever wondered who would win between a Christmas tree and Shaquille O'Neal? Shaq? Well, that wait is over. During halftime of the Warriors/Clippers game on TNT, Kenny Smith and Shaq raced from the desk and Kenny gave Shaq a little nudge, and the big man, well, he went right into the tree. That poor tree. Shaq's 7-feet-1, 300-plus pound, that's got to hurt. That's "Bleacher Report".

(LAUGHTER)

ROMANS: Those reflexes, he wouldn't get very far on the basketball court with those sort of reflexes.

POPPY HARLOW, CNN ANCHOR: I just keep thinking about the person who spent hours and hours making that tree and so beautiful all to see it laid out.

MCFAYDEN: Shaking their head for sure.

HARLOW: Thank you, Brian.

MCFAYDEN: You're welcome.

HARLOW: All right. Well, over the last 12 months, we have witnessed a political upset for the ages and a series of Secret Service screw- ups, a Congress that can't get much of anything done. So, we're counting down the top ten political stories of 2014. What a year it has been.

ROMANS: And now that the holiday shopping season is winding down, it's time to start counting up the receipts. Making some returns. How did retailers do and just how strong is the American economy? We're going to have a look.

(COMMERCIAL BREAK)

HARLOW: Well, from ISIS to the Republican wave in the midterms, to the battle over police violence, it has been an intense and very busy year in politics.

Here's a look back at the biggest political stories of 2014 with the host of CNN's "THE LEAD", Jake Tapper.

(BEGIN VIDEOTAPE)

JAKE TAPPER, CNN CHIEF WASHINGTON CORRESPONDENT: Politics grabbed big headlines in 2014, with criticism and praise for the president's foreign policy, some stunning congressional dysfunction, and a crushing defeat for Democrats in the midterm elections.

Here are our top 10 political stories.

(voice-over): Number 10: 2014 offered a preview of what the 2016 presidential campaign might look and sound like as Hillary Clinton hit the road to promote her latest book. The media blitz and book tour looked a lot like a presidential candidate gearing up.

Number nine: Republican incumbents kept feeling the heat from the Tea Party which showed it isn't going anywhere.

CHRIS MCDANIEL (R), SENATE CANDIDATE: The conservative resurgence with this country starts right here in Mississippi.

TAPPER: A Tea Party campaign by Chris McDaniel nearly caused a long- time senator form Mississippi, Thad Cochran, his seat. The primary runoff created one of the strangest political coalitions of the year, Republican Cochran courting black Democrats in the Magnolia State to bail him out in the runoff.

SEN. THAD COCHRAN (R), MISSISSIPPI: This is your victory.

TAPPER: Cochran survived but others were not so lucky. The number two Republican in the House did not even make it to Election Day. House Majority Leader Eric Cantor lost his primary to this guy -- economics professor David Brat -- in what may be the political upset of the decade.

REP. ERIC CANTOR (R), VIRGINIA: Obviously, we came up short.

TAPPER: Number eight: the U.S. does not negotiate with terrorists but we will do a prisoner swap. Sergeant Bowe Bergdahl, the only U.S. prisoner of war in Afghanistan or Iraq was brought home after the U.S. traded five Taliban fighters from Guantanamo Bay for his release. The celebration had one huge footnote. Not everyone was thrilled with the exchange rate.

REP. PETER KING (R), NEW YORK: For the president to decide that these five hottest of the hard core in return for Sergeant Bergdahl at this stage I think was wrong.

TAPPER: Not to mention the administration broke the law by not giving Congress 30 days' notice.

Number seven: a fence jumper who sprinted across the White House lawn and let himself into the front door, exposed major security breaches with the Secret Service.

REP. JASON CHAFFETZ (R), UTAH: Don't let somebody get close to the president. Don't let somebody get close to his family.

JULIA PIERSON, SECRET SERVICE DIRECTOR: I take full responsibility.

TAPPER: The security gaps led Julia Pierson, the first female director of the Secret Service appointed after a frustration scandal, to step down.

Number six: accusations that U.S. veterans died while waiting for treatment at Veterans Administration hospitals was a national embarrassment. A month-long CNN investigation showed altered death certificates and secret waiting lists.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I want to know the full scope of the problem.

TAPPER: Secretary of Veterans Affairs Eric Shinseki was sacked from his cabinet post after the scandal broke, and the repairs to the broken system still seem to be a long way off.

Number five: President Obama's foreign policy under attack. An off- the-cuff phrase uttered by the president "don't do stupid stuff" was criticized by none other than former secretary of state Hillary Clinton as an inadequate defining principle.

The Israel-Gaza war, the civil war in Syria, the Russian invasion of Ukraine, the prisoner swap for Alan Gross in Cuba, the president's foreign policy was criticized even by many Democrats as feckless.

Number four: 2014 marked another year of congressional gridlock on immigration reform. There was no greater example of the broken system than the thousands of unaccompanied children from Central America flooding across the Texas border. President Obama opted after the midterms to go it alone, using executive action in an attempt to reform the system. Critics call his actions unconstitutional.

Number three: any notion of America's first black president ushering in a post-racial era of healing got squashed. After white police officers in Missouri and New York killed unarmed black men, protesters around the country took to the streets. Following the grand jury's decision not to indict Officer Darren

Wilson for killing Michael Brown in Ferguson, President Obama delivered a speech urging calm.

OBAMA: So, we need to accept that this decision was the grand jury's to make.

TAPPER: And the split screen on your television showed the depth of the disconnect -- a city burned, and the president's pleas going up in smoke.

Number two: the U.S. went back into Iraq, this time to fight ISIS. Just a few months after President Obama dismissed the terrorist group as a jayvee squad, ISIS took huge swaths of land along the lawless Iraq and Syria border. The president finally changed his tune and ordered targeted attacks in Iraq and Syria against the terrorist group.

And the number one top political story of the year: on election night, it was a red wave as Republicans won control of the U.S. House and the Senate.

SEN. PAT ROBERTS (R), KANSAS: We crossed the finish line. We took the Hill.

(CHEERS)

TAPPER (on camera): The politics of 2015 might just look a lot like a giant stack of promises made in the race for the White House in 2016. We'll have to wait and see if a lame duck president can work it out with a deadlocked Congress.

I'm Jake Tapper.

(END VIDEOTAPE)

ROMANS: It will start to get interesting. It's been interesting. It's going to get even more interesting.

HARLOW: Here we go.

ROMANS: So, how is your economic health now that the holiday shopping season is winding down? Did you stay on budget? How did the retailers fare? Did they convince you to part ways with your money? A closer look ahead.

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ROMANS: All right. Welcome back to NEWSROOM. Happy holidays.

Numbers out this week show the U.S. economy growing at the fastest pace since 2003. And it's really interesting new CNN/ORC poll shows a majority of Americans think the economy is in good shape. A majority for the first time in seven years, that is a big improvement since October, when only 38 percent of Americans felt like the economy was in good shape. Did this optimistic outlook inspire Americans to go out and go shopping this holiday season?

Joining us now: personal finance author and columnist, Terry Savage, and executive vice president of Shoppertrak Bill Martin.

Nice to see both of you.

Terry, I've got to ask you first. Americans finally say they feel it. The economy is back, Americans finally feel it I'm a little cynical. I think it's gas prices. They feel lower gas prices, so they're feeling better about things, am I right?

TERRY SAVAGE, PERSONAL FINANCE AUTHOR: I think that's absolutely the first part of it and a stream of other news that's very good about the economy, about jobs. 2014, I think we'll look back and say that was the year of the markets, the records in the stock market, low interest rates. But I think as we look ahead to 2015, we'll say this is the year of the consumer, because those lower energy prices, not only gasoline prices, but home heating bills, especially compared to last year's devastating winter will be lower. And we'll see it in costs for everything from food, energy is a big component. So, it will give consumer reason to be optimistic for the first time in a long time.

ROMANS: Yes, in a very long time.

I think time heals all wounds as the old terrible cliche, but when you're talking about the consumer, they really remember what happened in the economy like it was yesterday, especially if their wages aren't growing.

Bill, let me ask you, we saw Black Friday sales down, a little bit disappointing. Are people feeling the better economy? Did they go out and shop and spend money? Or are they still being frugal at the mall?

BILL MARTIN, FOUNDER, EXECUTIVE VICE PRESIDENT, SHOPPER TRAK: Well, I think they did go out and spend their money. We saw some pretty strong sales in November. Even despite Black Friday being a little bit soft. November showed a 5.4 percent lift, which was pretty good, rolling into December. Now that the holidays are over, there's still a couple of pretty important days left, today being one of them, the sixth largest sales day of the year.

So, we expect them to come out and look for bargains, do their returns and try to redeem some of the gift cards they may have received during the holidays.

ROMANS: Oh, yes, the returns and the gift cards. There's still a frenzy of the last-minute behavior.

Terry, you know and I say it, too, you shouldn't buy something you can't pay off in the next round of the credit card bill. How much are people digging in? Are they being smart?

SAVAGE: Yes, I think consumers are being smarter now.

First of all, the lenders, the merchants are being smarter. You remember a couple of years ago, there were -- you walk into a store and say, take out a store credit card and we'll give you a discount. There's a lot of concern about credit card security, so there wasn't so much credit pushed on consumers. I think consumers are being smarter, though, looking for lower-rate cards, recognizing that the bills will come due in January and that's a lesson learned. You know, we don't want the economy to grind to a halt. But it's not every individual's job to go into debt to support the economy.

So, I think we're at the sweet spot now where consumers recognize the dangers of debt. But they also have a lot of pent-up demand for the few years of not shopping so much. So, we're at a nice sweet spot coasting into the New Year. That's the optimistic view-point.

ROMANS: Well, you know, Terry, it's interesting. You saw car sales in November were just fantastic. I know we've got big sales coming up on big-ticket items like TVs and furniture as they roll over into the next model year for furniture and stuff. Do you think you're going to see -- do you think you're going to see consumers out there -- 2015 is their year the way 2014 was for stock market investors?

SAVAGE: Yes, absolutely. This is I think what spells over into the New Year. The one area of the economy that's been I wouldn't say lagging, but it's slow. It's a new home sales and sales even of existing homes. More people choosing to rent. Many people not having the credit reports that will justify getting a mortgage.

But now you see they're loosening up a little bit on mortgages again, both on procedures and down payments. And even if interest rates do go up just a bit, which the Fed will do, I think it will spur people into saying if we're going to buy, we better buy now.

So, if this good momentum from car sales and shopping and optimism continues, I think you'll see it in the housing market, and that, of course, leads to other good things in the economy. So, that's my hope and I think my estimation for what will happen in the New Year.

ROMANS: I agree with you on the housing front. I really do. And I think younger people are going to be getting in the game, because rents are going to be rising. They have been rising. And if you can get the lending standards loosened a little bit, it's young people, young gen-X, but also millennials you might have a really nice when things finally do loosen up.

So, Bill, so let's talk about this. It sounds to me like the consumer is finally getting some confidence there. First, just for this weekend, this week, what is your advice for people going out and returning or trying to get something really cheap?

MARTIN: Well, we think doing your research is important. We have seen the consumer has really changed the way they shop. Now, they do a lot of research online. If fact, they do more research than they actually do buying online, with 90 percent of the commerce still taking place in the brick-and-mortar stores.

So, it's our advice that you take a look, online, try to figure out what you want and where you can get it. This is what the consumer is doing without our help at all. So, what we see is them showing up at stores with cash in their pockets, you know, cash that comes from reduced gas prices. And they're ready to make a purchase.

So, we advise retailers, once the consumer walks in there, it's important to deliver a good experience in order to convert that to a sale.

ROMANS: Do you agree with Terry, that 2015 is going to be the year for the consumer?

SAVAGE: It will be, but --

MARTIN: I think it's going to be --

(CROSSTALK)

ROMANS: Bill, would you, do you agree with her?

MARTIN: Yes.

I do. I think it's, I think it will be a time when they've, finally gotten to the point where they're comfortable they're going to continue with their employment. We're seeing low energy costs. I don't think that landed in the holiday season. But I think it will carry through into the first quarter. And what retailers are really interested in is a sustained growth and we see a 3.8 percent lift this holiday season. But they would like to see that carry into the first quarter and I think the consumer is ready to do that.

ROMANS: Bill Martin, Terry Savage, my Christmas/new year/holiday wish is that wages will go up in 2015. Maybe it's just a pipe dream, but, boy, I would like to see everybody's wages go up, and that will keep this economic recovery really firing. Thanks, guys, nice to see you. Happy holidays.

MARTIN: Thank you.

ROMANS: All right. We're following a lot of news this morning, we want to get right to it.

(BEGIN VIDEOTAPE)

MAYOR BILL DE BLASIO (D), NEW YORK: Any statements suggesting violence towards police need to be reported.

UNIDENTIFIED MALE: A growing number of threats against the NYPD.

UNIDENTIFIED MALE: It's a great loss. These are heroes. And it hurts.

BROWN: The terrorists appointed governor of Mosul was killed in an airstrike. At the same time, ISIS has a valuable bargaining chip.

UNIDENTIFIED FEMALE: The U.S. would support any effort to recover the pilot.

UNIDENTIFIED FEMALE: "The Interview" has finally made its debut.

UNIDENTIFIED MALE: And if it wasn't for theaters like this, and for people like you guys --

UNIDENTIFIED MALE: I think I got what I paid for.

UNIDENTIFIED MALE: This literally would not be happening right now.

(END VIDEOTAPE)

ROMANS: Good morning to you. Welcome to NEWSROOM. I'm Christine Romans along with Poppy Harlow and Pamela Brown.

The top stories we're following this morning.

The New York City Police Department on heightened alert following the arrest of seven people accused of making threats towards the NYPD. Two suspects even targeting the precincts -- the very precincts that was home to two officers who were shot dead in their patrol car last weekend.

HARLOW: Also, a public wake will be held this afternoon for one of the victims, Officer Rafael Ramos. People, of course, paying their respects at a growing memorial for the slain officers in Brooklyn.

Let me get straight to Miguel Marquez. He's at the church where the wake is being held.

Just an outpouring, Miguel.

MIGUEL MARQUEZ, CNN CORRESPONDENT: Enormous outpouring, we're only beginning to see the start of it. From 2:00 to 9:00 p.m., the wake will be for the funeral for Officer Ramos will be -- NYPD is expecting up to 25,000 police officers alone, to blanket this area. Another several thousand friends, families -- there may be as many as 30,000 people here. All of this as NYPD is on alert against other threats.

(BEGIN VIDEOTAPE)

MARQUEZ (voice-over): NYPD in mourning and on heightened alert.

DE BLASIO: Any statements suggesting violence towards the police need to be reported to the police so we can stop future tragedies.

MARQUEZ: Seven people arrested in connection with making threats against NYPD. Three arrested for posting threats on social media, two for making false 911 calls. Two others arrested. One for making threats against 104th precinct in Queens. The other against the 84th precinct in Brooklyn, where the two assassinated officers worked.

Officer Rafael Ramos' family came to the 84th precinct Wednesday. His eldest son Justin calling his father a hero, said, "I'm going to miss his loving presence and I can't begin to fathom what life is going to be like without him."

The memorial to the two officers growing in proportion to the sorrow felt, city-wide.

Police have come, sometimes alone, others in groups all in a show of respect, their grief unmistakable.

UNIDENTIFIED MALE: This is sad, it's really hurting me. Even though I'm not a police officer, but it just -- it really got to me, watching this on TV with my family.