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Early Start with John Berman and Zoraida Sambolin

Yemen In Crisis; Medical Students In ISIS Hospitals?; ISIS Hit- List Of U.S. Troops?; Obama: No Two-State Solution Under Netanyahu; Israel Seeks To Influence Iran Deal; Bar Owner: Johnson "Cordial" Before Arrest; Stocks Are Near Records. Aired 5:30-6a ET

Aired March 23, 2015 - 05:30   ET

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

[05:30:00]

CHRISTINE ROMANS, CNN ANCHOR: -- coming to the terror organization. We are live in Baghdad ahead.

The 2016 presidential campaign has begun. Texas Senator Ted Cruz is officially entering the race.

Welcome back to EARLY START. I'm Christine Romans. It's 30 minutes past the hour. Happening now, Yemen is in crisis as the U.S. pulls the last of its forces about a hundred special operations troops out of Yemen in response to the deteriorating security situation there.

The chairman of the House Homeland Security Committee is warning of the dangers of losing Yemen as the base for U.S. counterterror operations.

(BEGIN VIDEO CLIP)

REPRESENTATIVE MICHAEL MCCAUL (R), HOMELAND SECURITY COMMITTEE CHAIRMAN: You have no intelligence footprint or capabilities to monitor what AQAP and ISIS and the Shia militants are doing in the region. Without -- you know, good intelligence stops plots against the homeland. Without that intelligence, we cannot effectively stop it.

(END VIDEO CLIP)

ROMANS: On Sunday, Houthi rebels opposed to Yemen's president seized an international airport in the city of Taiz. Meanwhile, the U.N. Security Council met in an urgent session backing the president and calling on all sides to put down their weapons and negotiate.

A U.N. official is warning Yemen is in a rapid downward spiral and that quote, "the edge of civil war." For the latest on situation in Yemen, let's bring in Hakim Almasmari, the editor of "The Yemen Post." Good morning, Hakim.

HAKIM ALMASMARI, EDITOR-IN-CHIEF, "THE YEMEN POST": Hello.

ROMANS: This sounds like a very grim assessment of what's going on in the region. Bring us up to speed. ALMASMARI: Yes, they're chaotic right now and the problem is we are worrying at the beginning stage. The military is divided. The public is divided. There are hundreds of people who are joining militant groups on a daily basis. The army is right now divided.

It has no power or authority. This is what the crisis in Yemen is worrying. A main reason the U.S. government left Yemen with its forces. Knowing that there is no central government that they can cooperate with and militants are now in control.

ROMANS: So militants fighting each other for control. It sounds like a Petrie dish for ISIS, for al Qaeda, for all sorts of radical groups.

ALMASMARI: It is right now especially last week. This week when hundreds of al Qaeda militants were freed from prison -- they escaped because of the clashes that were taking place with two factions of the military.

Al Qaeda is using these clashes between both sides for its gains. The Houthis are gaining from this as well. The idea right now is that factions must agree. The only way to stop the problem is through political talks and dialogue. Yemen will fall into a civil war sooner rather than later.

ROMANS: All right, thanks so much for bringing that to us. Hakim Almasmari, editor of "The Yemen Post," thank you, Hakim.

This morning, the FBI and military investigators are looking into a purported hit list of U.S. troops posted online by a previously unknown group claiming affiliation with ISIS.

It's called the Islamic State Hacking Organization. It posted the names, pictures and addresses of 100 troops. There are also reports that a group of foreign medical students have traveled to Syria to work in ISIS-controlled hospitals.

A Turkish lawmaker telling CNN this group of 11 includes seven Britains, an American and a Canadian. Joining us now from Baghdad with more is CNN's Jomana Karadsheh. Good morning, Jomana.

I think the fact there are young people who have gone according to the Turkish lawmaker shows the narrative of Jihad is resonating in these countries.

JOMANA KARADSHEH, CNN CORRESPONDENT: Of course, that remains a major concern, Christine, for western nations and the international community. In this case, what we do know is coming from a Turkish member of parliament we do not have this information independently verified.

We are working to get more information about the circumstances of their travel to Syria. Here is what the lawmaker is saying, group of 11, seven British nationals, an American, a Canadian and two Sudanese. They were studying in Sudan.

Eight of them are fresh graduates of medical school there. Three are in their final year and this month, they traveled to Turkey and from they crossed into Syria.

This lawmaker says that they are working in hospitals in ISIS- controlled territory. We cannot verify the current whereabouts or motivation is for going into the ISIS-controlled area.

[05:35:02] This Member of Parliament is telling British media that their families who have been in touch with them who have been in Turkey for the last ten days to try to track down their children, he says they are convinced that they are working for ISIS and describing them as, quote, "being brainwashed and cheated by the group."

He says that the families are really trying very hard now. They are launching an appeal, seven mothers and fathers on the Turkish side of the border trying to convince their children to come back home -- Christine.

ROMANS: Wow, unbelievable story. Now meantime, this report that a group has posted 100 members of the U.S. military, their names, addresses and pictures online. What do we know about this?

KARADSHEH: Well, this is a group that we have not heard of before, but in the past couple of days, a threat came out by the group calling itself the hacking division of the Islamic State. Since then, now the threats have been taken down.

As you mentioned earlier, the names, pictures and addresses of 100 U.S. military personnel posted by the group calling for attacks on them on U.S. soil. Now the Department of Defense and U.S. government agencies are investigating this. They are looking into this threat trying to verify.

They are also notifying the U.S. military personnel who are mentioned in this threat. While this group says it hacked a database and able to collect this information, there is a lot of skepticism about that because this information might be available for them through social media.

But of course, in cases like this, the U.S. government and of course, other countries would have to take these threats very seriously, especially with that threat of lone wolf attacks in the west.

ROMANS: Of course, Jomana Karadsheh for us this morning in Baghdad. Thanks, Jomana.

Back here, Ted Cruz making it official, the Republican senator from Texas becoming the first candidate to announce a bid for the White House in 2016. He tweeted overnight, "I am running for president and I hope to earn your support."

Cruz is expected to follow-up that tweet with a declaration speech at Liberty University in Virginia today. He is, of course, the voice of the Tea Party. He starts the race trailing potential candidates, Jeb Bush and Scott Walker in the polls.

Time for an EARLY START on your money this morning, U.S. stock futures are down after Friday's gains. The Nasdaq closed above 5,000 for only the fourth time in history. It is now within striking distance of its high of March 2000 high made during the dot com bubble.

All right, Starbucks customers, you will no longer see "race together" written on your cups by your barista. The coffee giant is ending its effort to spark conversation about race relations with these written messages or these stickers.

This initiative was launched just a week ago. In a letter to employees, Starbucks CEO Howard Schultz wrote, quote, "While there has been criticism of the initiatives and I know this has not been easy for any of you, let me assure you, we did not expect universal praise."

Other parts of the initiative will continue like hiring 10,000 unemployed young people over the next three years. But for all of this sort of progressive social campaigns, this is one that was met with universal criticism, and dropped about a week.

All right, tensions rising between the White House and Israel, President Obama with new concern about being able to work with Prime Minister Benjamin Netanyahu as Israel works to put its own influence of a possible nuclear deal with Iran. We are live in Jerusalem next.

(COMMERCIAL BREAK)

[05:42:10]

ROMANS: The White House has all but given up on Benjamin Netanyahu as a willing partner in the Middle East peace process. This morning, President Obama saying that he took the Israeli prime minister, quote, "at his word" when Netanyahu said there would never be a Palestinian State under his leadership.

Then, of course, Netanyahu won re-election and last week began to backpedal and reassert his support for a two-state solution. CNN's Erin McPike has more from the White House.

ERIN MCPIKE, CNN CORRESPONDENT: Christine, President Obama told the "Huffington Post" that he believes achieving a two-state solution won't be possible under Benjamin Netanyahu because he said the prime minister reversed himself after the comments that he had made prior to his re-election last week.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: I did indicate to him that we continue to believe that a two-state solution is the only way for the long term security of Israel if it wants to stay both a Jewish state and democratic.

And I indicated to him that given his statements prior to the election it is going to be hard to find a path where people are seriously believing that negotiations are possible.

(END VIDEO CLIP)

MCPIKE: Obviously, it doesn't sound as though the air is going to be clear soon on that anytime soon. Now on another matter, the president also had sharp words for Senate Republicans who are holding up the confirmation vote for attorney general nominee, Loretta Lynch, due to differences on a completely different bill.

(BEGIN VIDEO CLIP)

PRESIDENT OBAMA: You don't hold attorney general nominees hostage for other issues. This is our top law enforcement office. Nobody denies she he is well qualified. We need to get her done.

UNIDENTIFIED MALE: Is Eric Holder prepared to stay as long as possible?

PRESIDENT OBAMA: Yes, he is. The irony is, of course, that the Republicans really dislike Mr. Holder. If they really want to get rid of him, do ahead and get Loretta Lynch confirmed.

(END VIDEO CLIP)

MCPIKE: Of course, both of these issues will be front and center for the White House this week -- Christine.

ROMANS: All right, Erin McPike, thank you so much for that, Erin.

Senior Israeli officials telling CNN they believe the real reason President Obama won't take Netanyahu's word that he does still support a Palestinian State, the real reason is that they say the White House wants to divert attention from a developing nuclear deal and negotiations in Switzerland.

Meanwhile, Israel is seeking to influence those negotiations sending a senior delegation to Paris for talks with French officials beginning today.

Let's bring in CNN's Oren Liebermann live from Jerusalem for the very latest. When you listen to President Obama in "The Huffington Post" interview, he is not taking Benjamin Netanyahu at his word that he does see a two-state solution.

OREN LIEBERMANN, CNN CORRESPONDENT: Not at all, Christine, this is the latest in the back and forth between these two world leaders that really started or at this latest round really started when Netanyahu spoke before Congress.

Since then we have seen these two sending valleys each way, criticisms, slight criticism each way, although, both have gone out of their way to reaffirm how strong the strategic coordination is and how strong the security cooperation is.

[05:45:11] But now we see the Netanyahu administration saying that Netanyahu never flipped sides regardless of his apparently contradictory remarks both right before and right after the election, as you mentioned, President Obama not buying it.

Saying he will, quote, "Reassess" very strong word there, "reassess the relationship between the U.S. and Israel." We already know, Christine, what Netanyahu's next move will or at least one of his next moves.

That is when House Speaker Boehner is here towards at the end of the month, which is right when the nuclear deal deadline with Iran comes up.

ROMANS: You have them sending the delegation to Paris trying to influence that deal. Tell us about that.

LIEBERMANN: Right. That's perhaps the administration here. The prime minister's office saying, look, there is nothing we can do to stop the deal. Now it's time to try to influence the deal and that would be Netanyahu speaking before Congress.

A lot of what Netanyahu said during the campaign. That would be trying to influence the American side of the deal. Meanwhile, the intelligence minister here heading to Paris, France to influence that side of the deal, both American and France, big players in those negotiations.

ROMANS: All right, thanks so much for that, Oren Liebermann.

Let's take a look at what is coming up on "NEW DAY." Chris Cuomo joins us this morning. Chris, I mean, this Yemen story really, really a grim situation developing there.

CHRIS CUOMO, CNN ANCHOR: I mean, there is no question about it. It could become the most dangerous place in the world, period. You have potential civil war and that's the least of it. You have al Qaeda, ISIS, Iran and the Shia rebels, all vying to make this place home.

This situation is so dangerous. The U.S. has pulled out even the Special Forces. Now, the big question in getting into this is how did a place go from being what the president called a success story against terrorism just six months ago to this?

Also on the political side, we are going to talk about Senator Ted Cruz. He is announcing he is the first man in. He is going to be a presidential candidate. All right, so the question is, is this the last time, Christine, that we will say that Ted Cruz is first?

We will bracket his chances, March Madness style, against the other people in the poll and see how he stacks up against the big shots. Let's see how you do calling it out on this one.

ROMANS: All right, that's -- I can't wait to see that. That is an interesting way --

CUOMO: I look forward to your choices.

ROMANS: Thank you. All right, Chris Cuomo, nice to see you this morning, Chris.

New criticism of a controversial arrest that left a University of Virginia student battered and bloodied, the chief of police of that town now on record next.

(COMMERCIAL BREAK)

[05:51:11]

ROMANS: The Charlottesville, Virginia police chief says the video of a bloodied University of Virginia honor student being arrested outside of a bar last week is disturbing.

State police are now investigating that incident involving 20-year-old Martese Johnson. The Alcoholic Beverage Control officers, those are the people making the arrest, they describe Johnson as, quote, "belligerent." But one of the bar owners is now contradicting that claim. CNN's Nick Valencia has more.

NICK VALENCIA, CNN CORRESPONDENT: Christine, the bar co-owner of the bar where 20-year-old Martese Johnson was denied entry is now speaking out via a statement from his attorney. He said he wanted to get out in front of the rumor mill and wanted people to know in his own words what his interaction that night was when he denied entry to Johnson.

Kevin Banke says while police described Johnson as agitated and belligerent, that his conversation with the 20-year-old was cordial. In that statement from his attorney, he said, "In Mr. Badke's opinion, Mr. Johnson did not appear to be intoxicated in the least.

Despite the conversation, which was cordial and respectful, Mr. Badke reiterated that he could not permit him to enter. He handed Mr. Johnson his identification back and Mr. Johnson began walking in a north westerly direction up University Avenue. A few moments later, Mr. Badke heard a commotion, turned and saw Mr.

Johnson on the ground about 30 feet further up on University Avenue with ABC agents detaining him."

Officially in a police report, Johnson was arrested for public intoxication and obstruction of justice without force. His court date is set for later this month -- Christine.

BERMAN: All right, Nick Valencia, thank you for that this morning.

The U.S. Supreme Court takes up a free speech battle over the confederate flag today. The case is involves the sons of confederate veterans. These group members challenge the state of Texas for rejecting a specialty license plate bearing their logo, their logo which features the confederate flag.

An appeals court then rules Texas officials had no grounds to bar the plate even if it is, quote, "offensive." The Supreme Court is expected to rule by late June.

All right, what is the best performing investment since President Obama took office? An EARLY START on your money is next.

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[05:56:42]

ROMANS: All right, let's get an EARLY START on your money this Monday morning. Asian shares ended higher, but European shares are falling. Greek and German officials will meet over Greece's bailout program. That always injects a lot of uncertainty into markets when they are meeting.

U.S. stock futures are lower as well. You know, stocks climbed on Friday. The Nasdaq closed above 5,000 for only the fourth time in history. It is now within striking distance of a record high from March 2000 during the dot-com bubble.

So it has been over six years since President Obama took office. Which assets have done best in his tenure, gold or commodities, even the U.S. dollar, the dollar has done well.

Stocks, though, are the clear winner over the past six years. The stock market bottomed out in March 2009. It has been climbing ever since. We are in the midst of the fourth longest bull run ever. If the rally keeps going for another couple of months, it will be the third longest bull market ever, returns topping 200 percent.

OK, millennials, those are people aged 18 to 35. They are the most educated generation in U.S. history and they have the most student debt to show for it. The biggest student loan mistakes, number one, you must graduate in four years, only 39 percent of students graduate in four years. That is an expensive extra year or two on borrowed money.

Second, be realistic about future earnings. You can only afford to borrow as much as you expect to earn in the first year working in the field. Third, don't miss student loan payments. Once you are in default, it becomes impossible to discharge in bankruptcy. Check out my book that drops in book stores. It's called "Smart Is the New Rich."

All right, 58 minutes past the hour, trouble for the U.S. war on terror. A key Mid-east ally on the brink of collapse, "NEW DAY" picks up that troubling story now.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Yemen is going to be again another country that we see falling out of control.

UNIDENTIFIED FEMALE: The last remaining U.S. troops have been evacuated from the country.

UNIDENTIFIED MALE: If ISIS gets a foot hold in these environments, you'll start to see state governments fall.

ROMANS: The reported ISIS hit list of U.S. troops posted online.

UNIDENTIFIED FEMALE: Names, pictures and home addresses of servicemen and women.

UNIDENTIFIED FEMALE: Group of medical students and graduates who may have traveled to Syria to ISIS-controlled territory.

UNIDENTIFIED MALE: I'm ready to stand with you.

ROMANS: Senator Ted Cruz announcing his bid for the Republican presidential nomination.

UNIDENTIFIED MALE: Bring on the popcorn and crazy for cruise bumper stickers.

(END VIDEOTAPE)

CUOMO: Good morning. Welcome to your NEW DAY. It is Monday, March 23rd, 6:00 in the east. There is a new major threat to U.S. security, Yemen, the country on the Arab Peninsula has been a critical ally to the United States even called a success in the war against terror six months ago by the president.

Now it is on the verge of becoming the most dangerous place in the world. The government overthrown by rebels, Al Qaeda, ISIS, Iran, all vying for control.

ALISYN CAMEROTA, CNN ANCHOR: The situation in Yemen so dire the U.S. even pulling out its special forces, creating a dangerous vacuum for terrorists to fill. Analysts fear that the retreat of U.S. forces will be a win for al Qaeda.

Let's begin our coverage with CNN's senior international correspondent, Nic Robertson live in London -- Nic.