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Rising Tensions as Saudi Arabia Cuts Diplomatic Ties with Iran; Armed Protesters Take Over Federal Government Building in Oregon; First Trading Day of the Year; Israeli Authorities Looking for Suspect After Deadly Tel Aviv Shooting. Aired 3-4a ET

Aired January 04, 2016 - 03:00   ET

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

[03:00:01]

(HEADLINES)

ERROL BARNETT, CNN ANCHOR: A very big welcome to our viewers here in the states and those of you watching from all around the world. I am Errol Barnett.

ROSEMARY CHURCH, CNN ANCHOR: And I'm Rosemary Church. Thanks for joining us. This is CNN NEWSROOM.

We'll have those stories in just a moment, but we begin with the developing story that could affect your finances, 2016 is off to a pretty rough start for Asian pacific stocks. China halted trading on two of its major exchanges. It happened as stocks plummeted almost seven percent.

BARNETT: You get a live look at the numbers here. Shanghai closed down 6.8 percent for the day. If you look at how the market performed over the past few trading sessions, you really get a sense just how abrupt this final sell off was. Coming up, we'll have much more on the Asian markets and what this may mean for stocks globally.

CHURCH: All right, but let's turn to another big story we're following. There are growing concerns that the weekends turmoil between Iran and Saudi Arabia could result in greater regional instability. Saudi Arabia has cut diplomatic ties with Iran and ordered Iranian diplomats out of the country within 48 hours.

BARNETT: Now this move came after Iranian demonstrators stormed the Saudi embassy in Tehran, ransacking and throwing Molotov cocktails as well. They were protesting Saudi Arabia's execution of a dissident Shiite cleric. The Saudi court had convicted him of strife sedition and breaking allegiance with the Saudi ruler.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We are determined not to allow Iran to undermine our security. We're determined not to let Iran immobilize or create or establish terrorist cells in our country or in the countries of our allies.

(END VIDEO CLIP)

CHURCH: And some more background, he was announced for cleric who spent a decade studying religion in Iran. Saudi authorities had arrested him several times. The 56 year old repeatedly called for the secession of Saudi Arabia's oil rich eastern province. That's where most of the kingdom's Shiites lived. And he also called for the family to be deposed, that he urged his followers to use peaceful demonstrations and civil disobedience.

Well, Iran's foreign ministry reportedly accuses Saudi Arabia of cutting ties to distract from its own domestic problems. CNN producer (Inaudible) joins us now from Tehran with an update. So let's get an idea what they're saying about this and what their reaction is.

UNIDENTIFIED MALE: The foreign ministry said today that Saudi Arabia is trying to externalize the problems and that policy and survival of the Saudi regime and the very existence of it seem to be in continuing its friction, policy of friction in the region. Again, he said that this is in order to take the tension away from its internal problems. Iran also said that it has gone along with the international convention for protection of the embassy in Iran, and he said that Iran did try its best but things got out of hand, and he said that Saudi Arabia is using this as an excuse to continue policies in the region and particularly with Iran.

This has been echoed by several other politicians in Iran and the Iranian people, on the street also seem to think that Saudi Arabia has gone too far. The Iranians have always been complaining about Iran's policy towards Saudi Arabia, which they consider to be too soft and not hard enough and not constructive enough.

[03:05:01]

CHURCH: All right. CNN producer (Inaudible) was there from Tehran in Iran, many thanks to you.

BARNETT: There could be so many implications to all of this. We now want to bring in our International Diplomatic Editor, Nic Robertson. He is live from London and can provide some perspective on all of this. Nic, Iran and Saudi Arabia engaged essentially in several proxy wars already. In Yemen and in Iraq, what does this escalation then mean for stability in the Middle East, overall?

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Well, it's certainly escalates tensions between the two countries, severing diplomatic ties will not A, bring any peace to Syria, or certainly, not getting an agreement. We saw the ceasefire in Yemen collapse over the weekend as well -- and probably as the sort of direct or indirect result of this escalation of tension. If you're looking at trying to see how this will play out over the coming months, it will certainly make those conflicts harder to resolve because both Saudi Arabia and Iran play a hand and a role in both of those countries.

They're accused of backing and, of course, Iran props up, they want the removal international backing for rebel groups they support inside Syria to help overthrow the peace talks that will happen in Geneva later this month. And peace talks that were happening in Switzerland over Yemen, really -- the way forward will be much more clouded by this issue. Can these current tensions be deescalated through diplomacy, certainly they have been through this kind of diplomatic spat before. It's possible. But on the face of it coming into the New Year, what this reflects is a tougher and stronger position by the Saudi leadership towards Iran and towards the people of the region they consider enemies at this time.

BARNETT: With these nations severing diplomatic ties, you wonder if that's as bad as it will get. Saudi Arabia struggling from low oil prices at the moment. Iran just worked out this new deal with Saudi Arabia's ally, the U.S. You wonder if all out war is even likely or the slight escalation of existing conflicts is the worse case scenario, what are your thoughts on that?

ROBERTSON: You know when you have a situation like this where the execution of somebody in the Saudis consider a terrorist, who they consider inspiring people to violence, consider the Saudi's here as trying to -- if you will, sort of crush the Shia voice inside Saudi Arabia. When you have an incident like this that goes from an execution to the targeting and burning of embassies, the Saudi's accused the Iranian leadership or significant voices within Iran to allow for the embassies and their missions to be burned inside Iran, when you see escalation of tensions like this, it is indicative that the situation is already tender dry, that any other misunderstanding between the two countries can escalate further.

When you look at the conflicts in Syria and Yemen, I don't think we'll see an over night change in the scale and scope of what's happening because of this. It speaks the underlying tensions. It speaks to a view that's being seen in Riyadh to deal with the regional problems that Saudi Arabia is becoming a much more dominant political military power inside the Middle East and inside the gulf region. So I think these are the dynamics that is we're seeing. Essentially, sparks can set a bigger fire, and it's not clear if that will happen right now. It certainly is possible. Misunderstandings can lead to that.

BARNETT: That's exactly right. Our International Diplomatic Editor Nic Robertson, live in London for us with news on the dominant Shiite and Sunni powers now cutting diplomatic ties. Thanks very much.

Now you all can find out more on the tensions between Iran and Saudi Arabia, whether they might boil over across the region on our web site, many of the reports we're showing you are posted, there the address CNN.com.

CHURCH: I want to turn to Iraq now, where government forces say they now control the former ISIS stronghold of Ramadi.

BARNETT: There are also pockets of ISIS fighters there in the city and the bombs and booby traps that ISIS left behind are making Iraq's fight even more challenging.

CHURCH: CNN International Correspondent Nima Elbagir is in Baghdad. She joins us now. Nima, the clean up operation is not over yet, but how long will it likely take to remove these from ISIS resistance in Ramadi?

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NIMA ELBAGIR, INTERNATIONAL CORRESPONDENT: Well, it is so dangerous. It has to be so painstaking and that really is what's slowing the retaking of the remaining areas where ISIS continues to exert control, but it is enough in times that control of the essential government district for Iraq to have jubilantly declared it, deliberately. We traveled with the forefront at the fight to take the city Iraq counter terror service, and they gave us this look, have a look, Rosemary.

(BEGIN VIDEO CLIP)

ELBAGIR: Ramadi after months of ISIS rule, this is what remains. ISIS' occupation of the city leaving its mark both above and below ground, these are the houses for the militants were hiding inside of, you can see what they were doing as they were digging up tunnels so that they were able to move from house to house without being seen by the coalition planes. And so that this wasn't spotted from the air, they were hiding the dirt that they were digging up and keeping it inside the houses themselves. You come through here. We can show you one of the tunnels leading through.

Some of these tunnels, we're told, went as far as a kilometer. We're going to go have a look inside. It's not actually that wide, but it does give you a sense of the moving in the dark under the ground, out of sight.

Ramadi fell to ISIS in May last year. Since then, Iraqi forces have been battling with integrity and ravaged morale. They told us the liberation of Ramadi should be celebrated around the world.

UNIDENTIFIED MALE: Defeating ISIS and this victory has impacted upon ISIS plans and its very existence for the weakness and desperation, the road is now open and clear.

ELBAGIR: Blindfolded and bound, captured ISIS fighters face the war. They were, we're told, attempting to blend in to what remains at the local population, a reminder ISIS fighters could be hiding in plain sight. Even as the road to Mosul in the Iraqi armed force's sights, a week on in the liberation of Ramadi and counter terror force battle the city at the remaining military presence. We're hearing some pops of gunfire. They're a little further across the other side of the river. The fighting is ongoing. The clean up operation is still going on.

And that's why the helicopter circling overhead. In spite of the threat of IEDs and road side bombs, the troops continue their painstaking push, under every inch of territory, a possible death. Everyone here knows so much is at stake in this liberation and not just for Iraq.

UNIDENTIFIED MALE: This victory is a victory for humanity because ISIS is against Iraq and against all of humanity.

ELBAGIR: It is also finally some palpable momentum in the battle. (END VIDEO CLIP)

ELBAGIR: What further complicates this, Rosemary, even as the fights are raging there are hundreds of families inside the area which ISIS hasn't gotten there. The forces are working to extract those families with as little risk and as possible. But as you saw there, for much of Iraqi top, this is now all about the road to in words of Iraqi Prime Minister to clear Iraq with ISIS presence within this year. It's going to be a tough road. They seem to believe the morale is there and that's what they're aiming for, Rosemary.

CHURCH: Mosul is certainly the big challenge here, isn't it? Nima Elbagir reporting there live from Baghdad, many thanks to you.

And on Tuesday, we will have more of the exclusive reporting from Ramadi. We'll hear from civilians who were caught up in the fighting, used as human shields and who now face more danger, that's tomorrow right here on CNN.

BARNETT: Today, though, a tense stand off is on going between armed protesters and police in the U.S. northwest, what does this group want from the federal government. We'll explore that after the break.

CHURCH: Plus, a brutal day for Asia Pacific stock markets, we're live from Seoul, after the break.

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[03:18:30]

BARNETT: Monday was the first trading day of the year for the major markets in Asia, and basically the region had to pull the emergency brake. China specifically, halted trading for the day on two major exchanges. The result of so-called circuit breakers set to suspend trade after significant losses. Trading stopped briefly when the Shanghai index fell almost five percent. You see it in the top right corner of your screen, when it resumed with a drop to another two percent, markets shutdown for the day. You see it down almost seven percent there. Paula Hancock joins us now with a review of all of this from Seoul, South Korea because as you see there's red in the entire region.

Paula, we're not sure what to make of this. Because China's Shanghai composite ended 2015 up quite significantly of the year, what caused this false start, if you can call it that to 2016?

PAULA HANCOCK, CNN CORRESPONDENT: Well, it was bad start to the year for all the markets and in particular the Chinese markets, and the reason, according to many analysts, weak manufacturing data. Now, this was an unofficial survey, a private survey that was carried out today, and it basically showed that manufacturing was slowing for the seventh part of eight consecutive months. So certainly that's not good news in that respect, another sign that the Chinese economy is slowing, and certainly that's going to spook investors in some of these other markets as well, as all these countries have significant trading deals with China. So that's really what was expected to be the input today. There has

been tremendous volatility in the Chinese market. In the summer, we saw the tremendous loss on many of the markets. As you say, it's surprisingly the Shanghai composite is actually up for the year, about 9.5 percent which most of the main indices can boast. That was quite significant. The fact is this volatility remains in the Chinese markets. That trigger mechanism was supposed to try and curve this volatility. As you say, when it hit 5 percent, lost all again 15 minutes suspension automatically comes into play to try to cool things down.

When it hit seven percent, the market automatically closes that's what we've seen today. So of course, the question now is what will happen when that market reopens tomorrow.

BARNETT: And on that question, Paula we see that in Hong Kong and Tokyo those indices down roughly three percent. Is a bounce back likely tomorrow? I mean, after all in trading the trading volume is quite low?

HANCOCK: Well, that's one thing to consider, these volumes. It is the first day of the year, many investors may not even be back at their desks yet. They may be coming back from holidays. So some of these movements might be extreme, might be exaggerated because of that volume. Of course, it's possible that there could be a bounce back. You really can't predict these things. But the other factors are playing into the markets, of course, as Middle East tensions. The ties between Saudi Arabia and Iran being severed is certainly spooking investors as well, Errol.

BARNETT: All right, Paula Hancock is live from Seoul, South Korea, and all of the red in the regions markets today, thanks very much.

CHURCH: Armed anti-government protesters are still held up in a headquarters of a federal wild life refuge in the U.S. state of Oregon.

BARNETT: That's right. The local sheriff there says the group is a militia that basically wants to overthrow the government. But the protesters say they're taking a stand about how the federal government uses and controls land. CNN's Polo Sandoval has the story so far.

POLO SANDOVAL, CNN CORRESPONDENT: These are members -- consider themselves "patriots and constitutionalists" looking out for the rights of landowners and ranchers as well. But you hear from law enforcement, even some civilians who disagree. They say this group is seizing an opportunity to further, what is a misguided cause.

(BEGIN VIDEO CLIP)

SANDOVAL: They're armed and staying put. A group of protesters broke into an unoccupied building at an Oregon federal wild life refuge Saturday. They claim to take a stand and use of land, the armed occupation broke off from a peaceful rally earlier in the day to support Dwight and Steven Hammond. They're a father-son ranching duo expected to report to prison Monday. UNIDENTIFIED MALE: It isn't my decision obviously, it's a sentence.

SANDOVAL: Hammond and his son were convicted of arson, setting at least 130 acres of federal land on fire. The Hammonds maintain it was a controlled flame that got out of hand. The flames were meant to cover up poaching.

[03:23:00]

UNIDENTIFIED MALE: It's sort of frightening when there's people making threats and people touting guns.

UNIDENTIFIED FEMALE: People are afraid.

SANDOVAL: Among the armed protesters, the son of Nevada rancher Cliven Bundy, he was at the center of a similar stand off with the federal government last year over grazing fees.

UNIDENTIFIED MALE: This is not a time to stand down. It is a time to stand up.

SANDOVAL: The younger Bundy called on the groups to descend on the county and demand the government restore "the people's constitutional right," part of a vague and vocal antigovernment message.

UNIDENTIFIED MALE: The people have been abused long enough. Their lands and their resources, they take them from them, to the point where it's putting them in harm's way.

SANDOVAL: The Hammonds are distancing themselves from this latest face off, their attorney communicating in a short but clear statement to the sheriff's office, says neither Evan Bundy nor anyone with this organization speak for the Hammond family. Those are protesters say, however, the demonstration is peaceful, but if provoked they will defend themselves.

(END VIDEO CLIP)

SANDOVAL: Law enforcement watching this evolving situation very closely. The FBI responsible for investigating as that refuge facility is, in fact, a federal building. Polo Sandoval, CNN New York.

BARNETT: I want to show you some flooding along the Mississippi river because it is slowly moving downstream. Take a look at these pictures, and they're now peaking at about 56 feet. That's roughly 17 meters, and apparently they'll stay that way for several days.

CHURCH: Flooding is also expected from the Arkansas and Ohio rivers and some tributaries, about 7 million people in 15 states are under the threat of flooding.

BARNETT: As you might imagine, that flood threat may be moving slowly, but there's no stopping it.

CHURCH: Let's turn to our Meteorologist Pedram Javaheri, joining us from the international weather center with the latest. And Pedram, just how bad is this going to get?

PEDRAM JAVAHERI, AMS METEOROLOGIST: You know it's going to go downstream for a few more days, and this is going to be a long-term event. You take a look across the Mississippi river valley, all down and in the gulf, about 15 rivers -- 15 states, parts of them reporting flooding across the region. We know the rainfall has been shut off in recent days. The forecast moving over the next week or so brings in light rain to the south where the waters eventually will be heavier rain fall possible towards the tail end, certainly a long term event. I looked at how much water was moving past some of the gauges. In St. Louis, the peak of this event about seven million gallons of water were moving every single second down the Mississippi river.

And you think the baseball stadium and Bush stadium in St. Louis. You can fill the stadium up with water about 75 to 80 seconds time, moving passed the city every single day. Speaking of water, some good news for other parts of the United States, mainly across the west coast of the U.S., where a storm system barely right across this region, forecast models doing wonderful job and hitting the picture, up and down the state of California. Higher elevations can see upwards, maybe 24 inches of snow fall possible. That's quite healthy when you take a look at some of the ski resorts, anywhere from 70-85 or so inches that's currently on the ground across this region.

(WEATHER REPORT)

BARNETT: Now, I know how it works. Thanks very much.

CHURCH: U.S. President Barack Obama is taking on gun control, coming up, what he's planning to do and the political backlash he's already facing.

(COMMERCIAL BREAK)

[03:30:01]

BARNETT: A warm welcome back to our viewers in the U.S. and those of you watching from around the world. It's your last half hour with us today. I am Errol Barnett.

CHURCH: And I am Rosemary Church. This is CNN NEWSROOM. We do want to check the headlines for you this hour.

Iranian diplomats are under orders to leave Saudi Arabia within 48 hours. The country is severing diplomatic ties with Iran after an attack on the Saudi embassy in Tehran. The embassy demonstration was in protest of Saudi Arabia's execution of a dissident cleric on Saturday.

BARNETT: Asia pacific stocks are beginning 2016 in deep negative territory. China halted trading for the day in two of its major markets after stocks plummeted by almost seven percent. You see the Shanghai composite and Hong Kong and Tokyo, those markets are down roughly three percent.

CHURCH: And markets in Europe are just now opening and the Asian opening is having an impact, all the arrows heading south and similar losses. The German market lost more than three percent and a larger than two percent loss for both the London FTSU 100 and markets in Paris.

BARNETT: At least 6 people have been killed in an earthquake that struck northeastern India, 43 others are injured. Several homes and government buildings are damaged and rescue efforts are underway.

U.S. President Barack Obama is due to announce executive action on gun control in the next few days.

CHURCH: Even before Mr. Obama makes his official announcement, it's already a major issue in the campaign for the White House. Chris Frates has the details.

(BEGIN VIDEO CLIP)

BARACK OBAMA, U.S. PRESIDENT: A few months ago, I directed my team at the White House to look at any new actions I could take to help reduce gun violence. On Monday, I will meet with the Attorney General, Loretta Lynch to discuss our options, because I get too many letters from parents and teachers and kids to sit around and do nothing.

CHRIS FRATES, CNN CORRESPONDENT: Sources say President Obama is expected to announce new executive actions to an expanding background checks on gun sales, aimed at closing the so-called gun show loophole, which allow some gun sellers to avoid conducting a background check. Gun control advocates have also pushed the White House to tighten regulations on the reporting of lost and stolen guns, and want the President prevent more alleged domestic abusers and passengers on the no-fly list from buying guns. But before the President has even announced the details of his actions, Republicans running to replace him were seemingly competing on who would undo them faster.

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: So he's going to sign another executive order having to do with the second amendment, having to do with guns, I will veto that. I will un-sign that so fast, so fast.

SEN. MARCO RUBIO (R-FL), PRESIDENTIAL CANDIDATE: All these executive orders he's going to come out with tomorrow that are going to undermine our second amendment rights, on my first day in office, they're gone.

FRATES: And Jeb Bush argued there's no need to expand background checks because...

JEB BUSH (R), PRESIDENTIAL CANDIDATE: The so-called gun show loophole that he's talking about doesn't exist. People that want to occasionally have sell guns ought to be by being impaired by the federal government.

FRATES: Democrats have applauded Obama's efforts. On Sunday, Bernie Sanders, whose Democratic rivals have called him weak on gun control, endorsed increased background checks. SEN. BERNIE SANDERS (I-VT), DEMOCRATIC PRESIDENTIAL CANDIDATE: I

think most gun owners in this country understand that people who should not own guns should not be able to buy them. And we do need to expand the instant background check. I don't think that's an onerous burden on anybody.

FRATES: Measuring American's attitudes on gun control seems to depend on how you ask the question. In a recent CNN poll, a majority said they don't support stricter gun control laws or the President's handling of guns, but when in another survey an overwhelming majority, 89 percent say they support requiring background checks for all gun buyers, Chris Frates, CNN Washington.

(END VIDEO CLIP)

CHURCH: And join CNN for a special look at guns in America with U.S. Barack Obama. Anderson Cooper hosts an exclusive one hour town hall event. You can see it Friday 9:00 a.m., Hong Kong time.

BARNETT: ISIS has released a new propaganda video threatening the United Kingdom. It shows masked English speaking militant and five men in orange jumpsuits accused of spying for the U.K.

CHURCH: At one point, the militant aims a gun at the camera and speaks directly to Prime Minister David Cameron. The five men are later killed.

BARNETT: Now the militant threatens to punish the U.K. in its role for helping with ISIS and Syria. For more on this, we're joined by Erin McLaughlin, live in London this morning. Erin, these horrific videos are typical of the type and style propaganda ISIS has been using over the past few years. How is this newest video similar and different to what we've seen before?

[03:35:01]

ERIN MCLAUGHLIN, CNN CORRESPONDENT: Well, Errol, this latest piece of ISIS propaganda perhaps notable for who is absent, not featured in this video is Muhammad also known as Jehadi John. Featured passed in which he carried out gruesome executions of western hostages. He of course, was killed in a U.S. air strike back in November. But in his place, another masked militant with an apparent British accent, instead of waving a knife, he's waving a gun, making similar threats to what we've heard in ISIS videos past, focusing on threats to the Prime Minister Cameron as well as to the United Kingdom.

Now, also featured in this video, the grizzly executions of five individuals accused of being spies for British security services. They're shot in the back of the head in the video, and then towards the end of the video, briefly show a little boy also speaking with an apparent British accent, making further threats against the west. Sadly, it's not unusual to see ISIS using children to further its propaganda agenda, Errol.

BARNETT: All right, Erin McLaughlin live for us in London this morning, thanks very much. CHURCH: All right, I want to return now to the increased tension

between Saudi Arabia and Iran. We're joined by Simon Mabon of Lancaster University in England. Thank you, sir, for talking with us. So I want to start, of course, we're learning that Saudi Arabia is severing diplomatic ties with Iran. The big question has to be how bad will these tensions likely get between Iran and Saudi Arabia?

SIMON MABON, LANCASTER UNIVERSITY: Well, I think that is the $1 million question, how bad things will get before calmer heads prevail, let's say. I think it has to be for the people that are affected by those -- there are proxy conflicts between the two states. We're talking about what's happening in Syria. We're talking about what's happening in Yemen. I think that the people -- that both Syria and Yemen will be incredibly badly hit, because at the stability of these proxy complex and the lack of desire to take steps towards reducing the tensions between the two states.

CHURCH: Now, let's go back to the trigger of this because it was of course, the execution of the dissident cleric from Iran. Saudi Arabian authorities would have been more than aware that this was going to be a provocative act and this was going to likely end in some protests or worse, perhaps. Why would Saudi Arabia take this action at this particular time, do you think?

MABON: You know, I think you're right in that Riyadh would have been very aware of what would happen if they were to go ahead and if they did and execute. And I think that we have to look at it from a number of different angles. Firstly, we have to think about the desired audience of this act. Is it that the act was taken to send a message? We know that Saudi Arabia has got a number of domestic issues. You've got rising unemployment. We've got issues with regard to the price of oil, the economic challenges that brings us to Saudi, we've got concerns at a more regional level about the growing influence of Iran, the intractability in Syria or in Yemen. And even maybe more at the international level -- Saudi Arabia is concerned about Iran being accepted, followed by the nuclear agreement. I think there are a number of different reasons and what this message is trying to say, they're still in charge, still in control, sending a message to a number of different audiences.

CHURCH: Interesting, details there and of course, as we mentioned Saudi Arabia severing diplomatic ties with Iran, and given that, what's the likely reaction, mixed reaction, do you think, from Iran.

MABON: Well, we saw interestingly a number of contrasting messages coming out of Iran over the past couple of days. We saw our state use agencies and the supreme leader having a very hard line response calling -- suggesting that it would be a divine retribution for what has happened. But we also had them condemning the protesters who stormed the Saudi embassy. There was a bit of a mixed message. There were some calm heads in between all of this war of words. I think Iran has got a really serious challenge to keep things calm but to appease its own domestic audience as well. Many who are concerned about versioning, but who are also concerned about what's happening in Saudi Arabia.

[03:40:01]

CHURCH: We'll watch this very carefully. Simon Mabon, Many thanks for joining us and sharing your analysis with us, we do appreciate it.

MABON: Thank you.

BARNETT: Israeli police are still searching for the suspect in a deadly shooting rampage in Tel Aviv on Friday. The suspect's family is calling for him to do, next.

(COMMERCIAL BREAK)

CHURCH: Israeli Police are looking for this man, who they say is armed and dangerous after a deadly shooting in Tel Aviv.

BARNETT: He's accused of using an automatic weapon to kill two people and wound eight outside a bar on Friday. The suspect's family says he has a mental disorder and they want him to turn himself in.

CHURCH: And for the latest, we want to bring in Ian Lee in Jerusalem. And Ian, we know that you had an opportunity to speak with the suspect's uncle, what all did he say to you.

IAN LEE, CNN CORRESPONDENT: Rosemary, the described person who was disturbed. He was depressed he had a difficult time holding down a job that he was supposed to be on medication -- that was stemming back from 2007 when he tried to steal a gun from a soldier. He was sentenced to five years in prison. Around that time he was put on medication. The family is afraid that he's not taking his medication right now. They're urging him to turn himself in. It's important to note that the family was the first people to tip off authorities that they believed their son, the father was the one that called police -- his son was the one that committed this act.

[03:45:01]

They're afraid that in this manhunt, that he will be killed. Now, for the police, this manhunt is still very much their number one priority. They have over 1,000 extra police officers in the Tel Aviv area searching that area, the northern part. They're going looking at abandoned billings, construction sites, terrorism teams are looking for him right now. Their main objective is to neutralize him, whether it's capturing or killing. They want to take him off the streets. And today in Tel Aviv, yesterday, rather, we saw that school districts had low numbers in one area 50 percent went to school. Today it's around 80, parents nervous about sending their kids to school while this man is on the loose.

Talking to the police, they say they've stepped up security, they're urging people to call in if they see something suspicious, we're hearing that a number of calls have increased by a thousand percent. Very much the community, as well as the police wants this person captured or killed.

CHURCH: Indeed it is a great concern for the community there. Ian Lee joining us live from Jerusalem, many thanks to you. BARNETT: Lighter topics for you after the break, the author of the

novels adapted for the popular HBO series Game of Thrones tells fans on his blog he's got a message for them, and they'll not like it. See what it is, next.

(COMMERCIAL BREAK)

BARNETT: All right. If you're a fan of Game of Thrones, surely you didn't see this plot twist coming. The next book in the series isn't finished.

CHURCH: How about that? On Saturday, Author George R. R. Martin revealed in a blog post, he hasn't finished the next novel entitled Winners of Winter, and he's having difficulty finishing it, blaming the stress of a looming deadline. But the show itself must go on. The sixth season is scheduled to begin airing in April and now mostly likely before the book is published.

BARNETT: Kim Serafin, the Senior Editor of In Touch Weekly joins us now from New York to talk about some of the entertainment headlines, happy New Year, Kim.

KIM SERAFIN, SENIOR EDITOR OF IN TOUCH WEEKLY: Thanks, happy New Year to you, too.

BARNETT: That's probably while you're in New York because all the great New Year's parties are out there. I watched the peach drop here in Atlanta.

SERAFIN: The peach, yes. I know you guys had fantastic coverage on CNN. I was watching Anderson and Kathy.

BARNETT: True. Let's talk about what some celebrities were up, Chris Brown was in Vegas for example, unfortunately a woman there accused him of battery. Brown is saying it's absolutely not true, but what exactly happened?

SERAFIN: Exactly. Police are investigating Chris Brown for alleged assault and theft. This woman is accusing Chris Brown of assaulting her and stealing her cell phone after she tried to take a picture of him. He's not been charged with anything. His rep put out a denial. And Chris Brown also put out an instagram post saying, saying happy New Year, he's going to make a lot of money for suing all these crazy individuals, so it sounds like he's definitely denying this as well through his instagram post.

BARNETT: His career has been cancelled because of that, his tours. Because we're at the beginning of the New Year, award season is heating up. What can we expect at the Golden Globes next weekend and from the host, English funny man Ricky Gervais?

SERAFIN: Golden Globes taking place a week from today, and this really kicks off in so many ways, so this is kind of an interesting award season where you do not have one stand-out film, there's a few getting a lot of buzz, expect to hear a lot about Spotlight throughout award season. Also, the Big Short, so I think these two could be the big winners. Golden Globes do best comedy and musical and drama. Spotlight and the Big Short look to them. But everything can change, of course, if Star Wars goes into play in the Oscars. I think this is what everyone is waiting for. Ricky Gervais is hosting the Golden Globes. He already put out a tweet, apologizing in advance for being insulting and drunk on stage.

[03:52:01]

BARNETT: Ok, good. So we can expect more of the same from Ricky Gervais. But you know you mentioned Star Wars getting Oscar buzz. Last year, the end of the year we talked about its incredible track. But is it worthy of an Academy Award. What's the conversation around that?

SERAFIN: Yeah, that is what the buzz is right now. And right now it's up to 1.5 billion. It hasn't opened up in China yet. So it's expected to be out of the box because of the opening in China. It's already beat Titanic here. It is on its way probably in the next few days will beat Avatar domestically. Plus, it's got 94 percent positive reviews on Rotten Tomatoes. There are a lot of people saying this could get an Oscar nomination, which would mean everything gets thrown out the window, because if Star Wars gets it for best picture, I think it's on track to win.

We'll talk about the Big Short, but Star Wars will be number one, too. I think a lot of people will like to see this get nominated.

BARNETT: Maybe it will get an Oscar. We'll see, Kim Serafin, the Senior Editor with In Touch Weekly, great to see you. Thanks for joining us from New York.

SERAFIN: Thanks so much.

CHURCH: I loved it. And thanks for watching CNN. I'm Rosemary Church.

BARNETT: How was your new year's by the way?

CHURCH: Fantastic. How was yours?

(CROSSTALK)

BARNETT: Remember, you can always connect with us on Twitter anytime. I am Errol Barnett, you see our handles there. Early Start is next for those of you in the states.

CHURCH: And for our viewers elsewhere, stay tuned for more from the CNN NEWSROOM. Have a great day.

BARNETT: See you.

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