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Syrian Troops Prepare for Attack on Aleppo; Race for the White House; Pope Francis to Hold Outdoor Mass; Israel Says Goodbye to Shimon Peres; Deutsche Bank Shares Rebound; Van Gogh Masterpieces Recovered. Aired 3-3:30a ET

Aired October 01, 2016 - 03:00   ET

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


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NATALIE ALLEN, CNN ANCHOR: Aleppo braces for what could be a final government assault on the city as thousands of troops amass near rebel held areas.

A major storm churns up the Atlantic hurricane. Matthew gains a cat five rating, threatening several Caribbean nations.

And police in Italy solve a 14-year-old mystery and recover a pair of priceless paintings by van Gogh.

Where have they been?

Remember that heist, when they lowered themselves from the ceiling and plucked them out of the museum?

They are coming back now. We will tell you about that. It is all ahead here on CNN NEWSROOM. I'm Natalie Allen.

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ALLEN: The battle for the Syrian city of Aleppo, as bad as it has been, is very likely going to get worse and more bloody. The U.S. estimates as many as 10,000 Syrian led ground troops are gathering in advance of what maybe a final assault of government forces against rebels holding part of the city.

Those left in Aleppo were already coping with devastation from months of heavy bombardment. On Friday alone, reports say at least 12 people died after warplanes targeted a residential neighborhood. And in the past few days of bombing, some 100 children have died.

The World Health Organization says some 270,000 civilians remain stuck in the city with dwindling supplies. Nick Paton Walsh has a closer look at this city on the brink.

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NICK PATON WALSH, CNN SR. INTL. CORRESPONDENT: With the possibility of as many 10,000 Syrian-led fighters or troops near the rebel-held part of Eastern Aleppo, that is one U.S. estimate, there are potentially very dark days ahead for that area.

Already under a pretty effective form of siege that's lapsed at times but now seems to be depriving them of food but also intermittently of water as well; 300,000, by some suggestions, civilians trapped in that area.

They have faced bombardment for years but nothing like what they've seen in the past weeks or days. The U.N. suggesting that 96 children have been by that bombardment in just the last week, 223 injured, hard really to fathom numbers like that. They come at you so often during a civil war.

Perhaps easier to understand what one aid worker we spoke to said, "My nerves are fraught. I simply can't talk about this anymore."

He described how he has seen three rockets land just recently near him, body parts everywhere and how the people there had no hope in anyone to come to their assistance now apart from God.

That's the kind of desperation we're seeing in this area. Those clashes in that area suggesting an offensive that may be launched by those troops in the forthcoming days or weeks in the central area, first in Al-Bashir (ph), where we also heard this day that a barrel bomb landed, killing seven people there as well, including children.

It is a dark episode, indeed. That area of Aleppo has held out for years against regime forces and now it faces, perhaps, a more strategic and significant collapse, that of U.S. policy at this time.

John Kerry, the U.S. secretary of state, has been so keen that he believes that a diplomatic solution, working alongside his Russian counterpart, Sergey Lavrov, nay possibly ease the violence here. There'd be some U.S. officials who've cynically pointed out they don't trust the Russians here at all.

Even John Kerry himself has said, frankly, it's his only choice. It's clear that the White House doesn't want to put military resources into a conflict that could be seen to clash openly against Russian resources on the ground there.

But the question now is what really has Moscow been planning for the past couple of weeks?

The volume of resources now potentially available for this assault against Aleppo, if it does happen -- and there are many suggestions that it may be underway -- will take weeks to get into play.

And those same weeks should have been spent, have been spent by Moscow and Damascus talking, potentially, diplomacy and peace with its Washington counterpart. That has fallen apart now.

We're now seeing one of the darkest episodes of violence that have hit Syria in this already nightmarish civil war. The U.S. talking about sanctions, maybe, against Russia; the possibility of better armaments being supplied by Syrian rebels, by their Gulf allies, that might be able to target Russian and Syrian aircraft. A lot of talk here at this point. But the broader recognition, the

U.S. is not going to commit ground troops here or potentially stop what many are already considering a war crime, the targeting of hospitals there as well.

Yes, this can be documented. This can be observed but it's unlikely there'll be an effective military response to stop it, certainly from outsiders, this looming now as potentially one of the darkest moments we have seen yet in Syria's civil war -- Nick Paton Walsh, CNN, Beirut.

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ALLEN: In Idlib, Syria, one rescue brought an aid worker to tears. A warning: --

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ALLEN: -- the images we are about to show you are disturbing.

We say that a lot here.

Volunteers from the White Helmets dug for hours to save a month-old baby. An airstrike hit her home and she was trapped. This video was in the back of an ambulance. The aid worker said he felt like she was his daughter.

You can also hear him calling out, "Dear God."

The U.N. says it's going to conduct an independent investigation into how its humanitarian relief trucks were attacked. The convoy was so close to Aleppo, preparing to deliver much-needed aid. Instead, those supplies were destroyed.

Officials say at least 18 people were killed, including the head of the Syrian Arab Red Crescent in the area. The U.S. blames Russian warplanes, an accusation Moscow denies.

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ALLEN: On the campaign trail, Donald Trump says he does not regret his Twitter tirade against a former Miss Universe.

The U.S. Republican presidential candidate mocked Alicia Machado in a string of scathing pre-dawn tweets Friday. Democratic rival Hillary Clinton called the Twitter rant "unhinged." More now from Jim Acosta.

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UNIDENTIFIED MALE: Mr. Trump, why did you go on the late-night tweet storm last night?

ACOSTA (voice-over): When it comes to his battle with former Miss Universe Alicia Machado, Donald Trump is no Mr. Congeniality. In response to Machado's claim Trump called her "Miss Piggy" for gaining weight, the GOP nominee lashed out at the pageant winner in a series of bombastic tweets in the middle of the night.

"Did Crooked Hillary help disgusting (check out sex tape and past) Alicia M become a U.S. citizen so she could use her in the debate?"

And this: "Using Alicia M in the debate as a paragon of virtue just shows that Crooked Hillary suffers from bad judgment! Hillary was set up by a con."

The Trump campaign, which offers no proof Machado ever even appeared in a sex tape but says it's just firing back.

JACK KINGSTON, SENIOR ADVISER, DONALD TRUMP CAMPAIGN: I don't know Ms. Machado, but I've seen many of the interviews with her. She's not a very credible witness, you might say.

ACOSTA: Clinton campaign chairman John Podesta jumped into the fray, poking at Trump on Twitter: "I'm almost Trump's age so get the urge to get up in the middle of the night. But important safety tip: Don't reach for your phone."

Machado insists her past is not relevant, admitting to CNN...

ALICIA MACHADO, FORMER MISS UNIVERSITY: Everybody has a past and I'm no -- a saint girl, but that is not the point now.

ACOSTA: In a statement, she says Trump's latest attacks are cheap lies with bad intentions, adding Trump "insists on demoralizing women, minorities and people of certain religions through his hateful campaign. This is one of his most frightful characteristics."

Trump is also ripping into the Clintons, with not-so-subtle references to their past marital problems.

DONALD TRUMP (R), PRESIDENTIAL NOMINEE: The Clintons are the sordid past. We will be the very bright and clean future.

ACOSTA: Raising questions of hypocrisy for Trump, who's on his third marriage.

UNIDENTIFIED MALE: You're not worried about your past history at all?

TRUMP: No, not at all. I have a very good history.

ACOSTA: Trump is also attacking the media, blasting reports that he was furious at aides for spilling the beans on his debate preparations, tweeting, "Remember, don't believe 'sources said' by the very dishonest media. If they don't name the sources, the sources don't exist."

But Trump has claimed to rely on anonymous sources, too, tweeting back in 2012, "An extremely credible source has called my office and told me that Barack Obama's birth certificate is a fraud."

And Trump is attacking newspapers when endorsements don't go his way. For the first time in its history, "USA Today" offered its opinion on a presidential race, declaring Trump unfit for presidency. And after that, the Trump campaign is slamming a report in "The

Washington Post" that The Trump Foundation was never properly certified to solicit donations.

DAVID FAHRENTHOLD, "THE WASHINGTON POST": By not doing this, Trump avoided a requirement that he submit to an annual audit, a real annual audit that might have looked into his foundation and found some of the violations of law that we seem to have found along the way this year.

ACOSTA: But Trump did find vindication on one front: the presidential debate commission said his microphone was defective in that first face-off with Hillary Clinton on Monday night.

At a rally here in Michigan, Trump suggested there was a conspiracy, telling the crowd he wonders why his microphone was so bad -- Jim Acosta, CNN, Novi, Michigan.

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ALLEN: A new national poll shows Clinton gaining some ground on Trump after that first debate. FOX News shows Clinton at 43 percent nationwide to Trump's 40 percent; with the margin of error it essentially makes that a tie.

Clinton is doing a bit better in some key states; in Michigan, she's up 7 points, 42 percent to 35 percent. That result is mirrored in New Hampshire. It is also a key battleground state that could go either way in November.

And in all-important Florida, the race has narrowed to just 4 points, barely outside of the margin of error --

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ALLEN: -- with Clinton ahead.

Nobody knows if the fallout from Trump's Twitter rant against the former Miss Universe will hurt him. But the incident is prompting some to take another look at what he has said in the past about women. And Kyung Lah reports Trump is not the only one in the spotlight.

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DONALD TRUMP, REPUBLICAN PRESIDENTIAL CANDIDATE: I do cherish women. I love women.

KYUNG LAH, CNN CORRESPONDENT (voice-over): Trump's critics question if that is really true. But it's not only Trump who is facing scrutiny. Some of his closest advisers are as well.

UNIDENTIFIED MALE: We need to have a fight in the Republican Party for the soul of the conservative --

UNIDENTIFIED MALE: I agree with you.

LAH (voice-over): Campaign CEO Steve Bannet (ph) in 1996, he faced misdemeanor domestic violence charges. His ex-wife, in the Santa Monica, California, police report alleging he grabbed her, an incident that the officer says left red marks on her left wrist and the right side of her neck. Those charges were dropped.

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UNIDENTIFIED FEMALE (voice-over): This is a FOX News alert. I'm --

LAH (voice-over): The man behind FOX News, Roger Ailes, is now an unofficial Trump campaign whisperer, although Trump won't officially acknowledge his role. FOX News ousted Ailes after multiple women accused him of sexual harassment; most prominently, anchor Gretchen Carlson, who received a $20 million settlement from FOX.

NEWT GINGRICH, FORMER HOUSE SPEAKER (from captions): You're not supposed to gain 60 pounds during the year that you're Miss Universe. (INAUDIBLE).

LAH (voice-over): That's former Speaker of the House Newt Gingrich, speaking this week, defending Trump's comments about Alicia Machado's weight gain after she won the crown. Gingrich is now a Trump adviser. He and Trump have both been married three times, both accused of infidelity.

In 2012, Gingrich's second wife recalled this about her former husband to ABC News.

UNIDENTIFIED FEMALE: Oh, he was asking to have an open marriage and I refused.

LAH (voice-over): Then there's Rudy Giuliani, former New York City mayor and Trump backer. After Monday's debate, Giuliani spoke to reporters, bringing up Bill Clinton's affair, criticizing not just him but Hillary Clinton.

RUDY GIULIANI, FORMER MAYOR OF NYC: She attacked Monica Lewinsky. And after being married to Bill Clinton for 20 years, if you didn't know the moment Monica Lewinsky said that Bill Clinton violated her, she was telling the truth, then you're too stupid to be president.

LAH (voice-over): But Giuliani should be able to relate to marital strife. Married three times, he announced a separation to his second wife at a press conference before telling her, his divorce and affair playing out publicly on New York tabloid front pages.

LAH: Trump's closest advisers are not all male. His campaign manager is a woman, Kellyanne Conway. And another person who has his ear is also a woman, his daughter, Ivanka -- Kyung Lah, CNN, Los Angeles.

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ALLEN: In other news we are following, India and Pakistan blame each other for these latest clashes in Kashmir. An Indian official said there were two separate shootings between troops Saturday. No one was killed. India has evacuated more than 10,000 people from the border area. The

two nations have nuclear weapons. They have fought two wars over Kashmir and have argued about this disputed region for nearly 70 years.

Deutsche Bank shares took a wild ride on Friday. Next here, whether they ended up or down.

And what's fueling this investor uncertainty?

Plus: a major hurricane threatens parts of the Caribbean. The latest on Matthew coming next with Derek Van Dam.

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ALLEN: I'm going to take you now live to Tbilisi, Georgia, where Pope Francis is holding an outdoor mass. He led a service with about 3,000 people in a football stadium. He's on his second day of a three-day visit to the Caucasus region between Europe and Asia.

He will finish up his trip at Azerbaijan on Sunday. That country predominantly Muslim with a tiny Catholic population of just a few hundred people.

Derek Van Dam is here with us now, because in the Atlantic we had a tropical storm and now we have a cat five hurricane.

DEREK VAN DAM, AMS METEOROLOGIST: Yes. This thing has strengthened so quickly, Natalie. In a matter of 24 hours, the storm strengthened by 80 miles per hour, over 120 kilometers per hour. So it is a formidable hurricane --

ALLEN: That is freaky.

VAN DAM: -- it is. It's freaky, it almost is because it went from a category two and the meteorologists saw it and said, OK, great.

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ALLEN: As we were bringing you live coverage of Shimon Peres' funeral, Israel has said its final goodbyes to the former leader. Dozens of dignitaries joined Peres' family for his funeral at Jerusalem's Mount Herzl.

Peres died Wednesday at the age of 93. He had a long life. He had led Israel as both prime minister and president, spending much of his life's work working for peace. Here's Nic Robertson with more on Shimon Peres.

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NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR (voice-over): A somber, solemn farewell, the last of Israel's founding fathers laid to rest, eulogists lionizing his life.

BILL CLINTON: He started off life as Israel's brightest student, became its best teacher and ended up its biggest dreamer.

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ROBERTSON (voice-over): President Obama reminding all, Peres' biggest dream never fulfilled.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: "We won them all," he said of Israel's wars.

"But we did not win the greatest victory that we aspire to, release from the need to win victories."

ROBERTSON (voice-over): Among the dozens of international dignitaries, presidents, prime ministers past and present; notable in their absence, though, Arab leaders, reflecting perhaps Peres' more hawkish roots, decades ago supporting Israeli settlers.

Regardless, Palestinian Authority President Mahmoud Abbas came, his first visit to Jerusalem since 2010; the Israeli prime minister, Benjamin Netanyahu, shaking his hand.

From Obama, the Palestinian leader getting a very warm greeting, handshake and a hug.

Stark contrast to the frosty body language between the U.S. president and Netanyahu.

So much apparent symbolism this day: Britain's Prince Charles sporting a black-and-white check silk handkerchief in his breast pocket, to all the world resembling a Palestinian keffiyeh.

Aside the appearance of less than subtle hints of international discomfort with the lack of peace process here, clear cajoling of today's crowd.

OBAMA: And so now this work is in the hand of Israel's next generation.

ROBERTSON (voice-over): Clinton pointedly spelling out how Peres found his path to peace, how today's leaders might do the same.

BILL CLINTON: It's easy to say things like this at a memorial service. It's hard to do. First, he had to master his own demons, forgive himself for his own mistakes and get over his own disappointments.

ROBERTSON (voice-over): Words of hope for a family in grief, for a nation at a crossroads -- Nic Robertson, CNN, Jerusalem. (END VIDEOTAPE)

ALLEN: After the funeral, President Obama was ready to go but his Air Force One passenger, Bill Clinton, wasn't.

Mr. Obama hurried him along saying, quote, "Bill, let's go."

Former President Clinton is infamous for his tardiness. He was greeting people who were at the airport to see the U.S. delegation off. But he eventually got on the plane.

Germany's biggest bank is in big trouble. On Friday, shares of Deutsche Bank bounced back from historic lows after the CEO appealed for calm. Investors worry the bank won't be able to afford a multibillion-dollar fine related to the global banking crisis. Atika Shubert has more on Deutsche Bank's troubles.

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ATIKA SHUBERT, CNN SENIOR INTERNATIONAL CORRESPONDENT: Bank secure Germany, the economic powerhouse of Europe. But at its heart lies a threat that could engulf the entire global banking system.

Deutsche Bank, the country's biggest bank, is facing a crisis. Shares have plummeted, in part to multibillion-dollar provisions for lawsuits. Investors panicked and Deutsche Bank lost half its market value just this year. CEO John Cryan (ph) tried to reassure staff in an e-mail.

Quote, "It is our task now to prevent distorted perception from further interrupting our daily business. Trust is the foundation of banking."

Some forces in the markets are currently trying to damage this trust. He also underscored the most important number for any bank: liquidity reserves, currently standing at 215 billion euros' worth, described by Cryan (ph) as, quote, "an extremely comfortable buffer."

But with share prices dropping and the U.S. looking to fine the bank $14 billion for misdeeds during the 2008 financial crisis, there are mounting concerns it will need a bailout.

Now the German government has said that, no, it's not in talks to rescue Deutsche Bank. But as market jitters continue to hurt the bank, the world is turning to Angela Merkel for answers.

UNIDENTIFIED MALE: Germany was instrumental in forcing countries like Greece, Portugal, Ireland, Spain into bailout agreements during the global financial crisis, a lot of them related to rescuing the banking sector.

So for now, for the German government to say, well, we'd just like to go ahead and bail out Deutsche Bank, isn't exactly going to wash very well with their fellow Eurozone governments.

SHUBERT: The German chancellor is already under tremendous public pressure as a result of her controversial decision to welcome more than 1 million refugees into Germany last year. Her party has since suffered its worst election results ever. A big bank bailout, paid for by taxpayers, may not be popular.

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UNIDENTIFIED MALE (through translator): It is a wrong approach. Banks are private because one should not help banks until there is a real risk to the country.

UNIDENTIFIED MALE (through translator): Well, if the bank really went broke, then it would be a catastrophe that would crack the economy open.

SHUBERT: And they are right. The IMF recently named Deutsche Bank as the single biggest systemic risk to the global financial system. Like it or not, Merkel may be forced to consider a bailout. A banking crisis triggered in Germany would be the last thing Angela Merkel and Europe needs -- Atika Shubert, CNN, Berlin.

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ALLEN: After 14 years, a pair of stolen van Gogh masterpieces could be soon heading back to a museum in Amsterdam. Italian police recovered the paintings in the home of an alleged mafia boss and you might remember how they were stolen from that museum. It was a daring stunt. Here's Barbie Nadeau from Rome.

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BARBIE NADEAU, CNN CORRESPONDENT: Mystery of the missing masterpieces finally solved after 14 years. Authorities in Italy revealed they have recovered two paintings by the Dutch master, Vincent van Gogh. "View of the Sea at Schevenengen (ph)" and "Congregation Leaving the Reform Church in Nunen (ph)," both said to be worth millions.

They were stolen from the van Gogh museum in Amsterdam back in 2002 in a daring heist that made international headlines. Police said thieves broke into the heavily fortified building through the roof.

UNIDENTIFIED FEMALE: What we have seen is a ladder on the backside of the (INAUDIBLE) museum and we found the rope. We're still looking if those things has something to do with the robbery.

NADAL (voice-over): Following a massive investigation dubbed "Operation Vincent," police blamed the Italian mafia for the heist. Police say they found the works hidden in a house in Naples that belongs to a suspected mafia boss.

Experts have now confirmed the paintings' authenticity, saying they appear to be in fairly good condition.

UNIDENTIFIED MALE: Needless to say it's a great day for us today to see the works and to know they are safe and that they are in safe hands. Of course we hope they will be able to return to our museum as soon as possible. NADAL (voice-over): Because the paintings are being used as evidence in the investigation, it's yet not clear when they will be returned but the museum's director says he's been waiting for this moment for 14 years -- Barbie (INAUDIBLE) Nadeau, CNN, Rome.

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ALLEN: It's been a long time but they have got them back -- almost.

Thanks for watching CNN NEWSROOM. We will have more on the presidential campaign. "POLITICAL MANN" is coming up right after our top stories.