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Early Start with John Berman and Zoraida Sambolin

Wall Street Reopens After Worst Christmas Eve Ever; Trump Wallows in Grievance for Christmas; CBP Promises Changes After Another Migrant Child Dies; Wintry Weather Could Affect Holiday Travel; Indonesia Adjusts Sensors to Detect Tsunamis. Aired 4-4:30a ET

Aired December 26, 2018 - 04:00   ET

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


[04:00:18] CHRISTINE ROMANS, CNN ANCHOR: Can Wall Street recover from its worst Christmas Eve ever?

The president is still railing against the Fed and running low on patience with his treasury secretary.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: It's a disgrace what's happening in our country. But other than that, I wish everybody a very merry Christmas.

(END VIDEO CLIP)

JOE JOHNS, CNN ANCHOR: A Christmas lump of coal from the president. No end in sight for the government shutdown. Now in day five.

ROMANS: For the second time this month, a migrant child dies in U.S. custody after crossing the border. Overnight, Customs promises changes.

JOHNS: Strong winds, heavy rain, and even some snow set to impact millions of people. A system moving east could slow a record number of holiday travelers.

ROMANS: Stay home.

JOHNS: Yes, absolutely, if you can.

Good morning, and welcome to EARLY START. I'm Joe Johns.

ROMANS: Nice to see you.

Merry Christmas. I'm Christine Romans. It is Wednesday, December 26th. Boxing day. It's 4:00 a.m. in the East.

Wall Street is set to reopen this morning after suffering the worst Christmas Eve declines ever. And it's been just a terrible December. Markets fell after the Trump administration sent out confusing signals about markets and the economy and liquidity in the financial system. No one was worried about that until this administration brought it up.

Futures are higher right now, but let's watch all of this volatility. Wall Street's Christmas rout also spilled into markets around the world. Really a terrible day yesterday in Asia, and then a bounce back for the Nikkei. Hang Seng and Shanghai both down right now. European markets will open and they are -- well, the Paris and FTSE are down, but in Germany, the average up just a little bit.

So, again, a lot of confusion about what the direction will be this week for stocks. Stocks fell Christmas Eve, and the president renewed his attacks on the Federal Reserve tweeting, the only problem our economy has is the Fed. And the president is growing more frustrated with his treasury secretary, Steven Mnuchin, despite Mnuchin's attempts to calm Wall Street.

A source told CNN, Secretary Mnuchin could be in serious jeopardy with the president. However, President Trump vouched for Mnuchin publicly, shifting blame for the market volatility to the Federal Reserve instead.

(BEGIN VIDEO CLIP)

REPORTER: Do you still have confidence in Secretary Mnuchin?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Yes, I do. Very talented, very smart person.

REPORTER: What about the Fed chairman?

TRUMP: We'll see. They're raising interest rates too fast. That's my opinion. But I certainly have confidence.

But I think it will straighten. They're raising interest rates too fast because they think the economy is so good.

The economy is doing so well that they raised interest rates, and that's a form of safety in a way. President Obama didn't do much of that, much easier to run when you have no interest rate. He had a very low interest rate.

I have great confidence in our companies. We have companies, the greatest in the world and they're doing really well. They have records kind of numbers. So, I think it's a tremendous opportunity to buy.

(END VIDEO CLIP)

ROMANS: The president of the United States telling investors it's a buying opportunity, something I have never, ever seen before. Look, investors do not like the president's repeated attacks on the Fed.

The "Wall Street Journal" reports a former senior economic official have privately warned the White House that the president's tweets and statements are making matters worse. The Nasdaq is in a bear market. The S&P 500 also near a bear market, down 19.8 percent from its high point October 3rd.

JOHNS: And it's the second day of Christmas, the fifth day of the government shutdown. President Trump yesterday said the government will not reopen until it gets the border wall funding he has demanded. He started Christmas with a phone call to U.S. troops around the world. But after that, the Grinch stepped in. The president made it clear he is not ready to ease his demands for a border barrier and is offering new clues about a compromise.

(BEGIN VIDEO CLIP)

TRUMP: I can't tell you when the government's going to be open. I can tell you it's not going to be open until we have a wall, a fence, whatever they'd like to call it. I'll call it whatever they want.

Every one of those Democrats approved the wall or a fence or very, very substantial barriers. As soon as I said I want to build a wall, they were all against it.

Take Comey. Everybody hated Comey, they thought he did a horrible job. The Democrats hated him. And once I fired him, everybody said, oh, why did you fire him, why did you fire him?

It's a disgrace what's happening in our country. But other than that, I wish everybody a very merry Christmas.

(END VIDEO CLIP)

JOHNS: And here's something else we've heard before, the president also criticized Democrats for planning to launch investigations when they take charge of the House of Representatives next month. He called that presidential harassment.

The offense of the shutdown will really start to be felt today.

[04:05:00] Staffing at the office overseeing food stamps will be cut by 95 percent, and the Department of Health and Human Services estimates nearly 8,000 federal employees will not return to work.

Customs and Border Patrol is making changes after a second child from Guatemala died in U.S. custody. An 8-year-old boy identified as Felipe Alonzo Gomez died late Christmas Eve in detention with his father. Now, authorities in Guatemala are calling for an investigation.

CNN's Jean Casarez has the very latest.

(BEGIN VIDEOTAPE)

JEAN CASAREZ, CNN CORRESPONDENT: Christine and Joe, U.S. Customs and Border Protection is saying that an 8-year-old little boy, a Guatemalan national who had been apprehended in new Mexico with his father, has died while in their custody. At this point, they do not have an official cause of death.

According to the timeline released by the CBP, it was the morning of Christmas Eve, and a Border Protection Agent noticed the child appeared to be sick. The little boy and his father were transferred to the Gerald Champion Regional Medical Center in Alamogordo, initially diagnosed with a common cold. That all changed, according to officials, when they discovered the boy had a fever.

He was released from the hospital mid-afternoon on Christmas Eve with prescriptions for antibiotics and ibuprofen. It was hours later, he began vomiting, was transferred back to the hospital, and he died. Now the Border Patrol's Office of Professional Responsibility is going to conduct a review of this most recent death to determine the official cause -- Christine, Joe.

(END VIDEOTAPE)

ROMANS: All right. Jean, thank you for that.

The boy's death comes just weeks after 7-year-old Jakelin Caal Maquin who was also from Guatemala died less than 48 hours after being detained by U.S. Customs and Border Patrol agents.

(BEGIN VIDEO CLIP)

REP. VERONICA ESCOBAR (D), TEXAS: Yet again these tragedies are happen in happening because Congress and the administration have not adequately provided the resources, both in personnel and infrastructure to adequately take these folks in.

(END VIDEO CLIP)

ROMANS: Now, the head of Customs and Border Protection is ordering immediate action. The new steps include secondary medical checkups on all children in CBP custody, adding capacity for medical assistance from partners like the Defense Department, FEMA, and Health and Human Services, and partnering with ICE to transport migrants to family centers or local charities that can provide temporary housing.

JOHNS: CBP also says it's reviewing options to relieve capacity issues in border patrol stations and check points in El Paso, Texas. It comes as ICE is expected to drop off 1,200 migrants in that region over the next few days, attorney to Congressman-elect Veronica Escobar, a Democrat. Four hundred eleven migrants were brought there Sunday, 260 migrants dropped off Monday. At least 180 sent there Christmas Day.

ICE drops off these migrants without providing food, shelter, transportation. ICE said it has limited options to remove families. The United States blaming decades of inaction by Congress.

ROMANS: All right. Signs of distress in America's national security system. A senior administration official tells CNN national security decision-making has, quote, basically stopped working. The source says decisions are, quote, made on a whim on phone calls.

The official also said the drawdown in Syria was done without deliberation, with no consideration of risks. In the weeks before the president made the decision, two sources tell CNN national security adviser John Bolton instructed senior officials to meet with coalition partners and assure them the U.S. is staying in Syria until Iran is out of Syria. JOHNS: A source tells us a move to pull out has left allies and

partners shocked, totally bewildered. Also warning Russia is reveling in the latest move since it sends a message to allies if Americans are your friends, they'll abandon you. Now almost a week after Defense Secretary Jim Mattis decided to resign, some officials are suggesting President Trump might have stayed in Syria if Mattis had gone sooner.

CNN's Barbara Starr explains from the Pentagon.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Christine, Joe, as the days have gone on since Mattis' abrupt and startling resignation, of course, everybody in Washington's got an opinion. Some defense officials are telling us they wonder if it might have been better if the secretary had stepped down sooner. He was known to have disagreements with President Trump. He had been sidelined in several matters as Secretary of State Mike Pompeo took a more predominant position in the Oval Office in advising the president.

And if Mattis had stepped down sooner, these officials say, could somebody have come in and convinced the president to stay the course with troops in Syria and troops in Afghanistan. Of course, we're never really going to know.

Some other officials say now that national security decision-making is very disjointed, very ad hoc, and made mostly by Mr. Trump depending on how he feels at a given moment.

[04:10:07] For Mattis, we may never know what's really been thinking until he either writes a book or decides to speak publicly -- Joe, Christine.

(END VIDEOTAPE)

ROMANS: All right. Barbara Starr, glad you're there to walk us through that.

The U.S.-led coalition against ISIS in Syria says coordinated air strikes have killed or wounded several hundred ISIS fighters. The Joint Task Force says that attack severely downgraded the terror group's logistics and staging areas. They say the air strikes dealt a significant blow to ISIS' ability to finance terrorist activities. The statement comes after President Trump's declaration last week that ISIS has been defeated.

JOHNS: So getting ready for the women's March next month? Well, in Chicago, it's been canceled. The movement's leadership is facing charges of anti-Semitism. So, we're going to talk about what reason the organizers are giving for the cancelation.

(COMMERCIAL BREAK)

JOHNS: OK. So, if you wanted it, it was a white Christmas but a travel nightmare in parts of the West. Snow in the 15 Freeway in the Cajon Pass between L.A. and Las Vegas triggering at least four separate crashes. The CHP had to temporarily close the highway.

ROMANS: That may be a sign of what's to come as record numbers of Americans hit the road for the holidays. Huge sections of the country will se strong winds, heavy rain, and mountain snow. That storm system pushing into the central part of the country where millions now are under winter weather alerts.

The latest now from CNN meteorologist Pedram Javaheri.

(BEGIN VIDEOTAPE)

PEDRAM JAVAHERI, AMS METEOROLOGIST: John and Christine, good morning, guys.

Yes, we are watching the Western U.S. here because that's where all the activity has been the past 24 hours. And eventually, this system puts itself in place across portions of the central U.S. where not only do we have the ingredients here for some severe weather, warm, moist air off the gulf, but a concern for heavy snowfall across portions of the Northern Plains. In fact, that's where the winter weather advisories are in place, the winter storm warnings, as well, for places across northern Minnesota, portions of the Dakotas, working back toward eastern Colorado on into Nebraska and Kansas, as well.

[04:15:03] But the system as it pushes off toward the east taps into quite a bit of warm air here. So, widespread rain showers expected across the Deep South, while even as far as northern New England. That's where you've got to end up to get some snow out of this through at least Friday. Notice back toward the west, we have the significant snow still in the forecast.

How about 42 degrees in New York City, almost 60 out of Atlanta. And some of the mild air eventually does want to push up towards the Northeast here as we go in toward the weekend. In fact, look at the temps here in New York City, up to almost 60 degrees. Then the bottom drops out, wrapping up with temperatures more seasonal for this time of year -- guys.

(END VIDEOTAPE)

ROMANS: All right. Pedram, thank you so much.

The Women's March slated for Chicago next month has been canceled. The past two marches drew hundreds of thousands to Grant Park in conjunction with other marches worldwide. Organizers say the two upcoming event -- the upcoming event was scrapped because of high costs and a volunteer shortage.

But it also comes as the movement's national founders face scrutiny over allegations of anti-Semitism and their connections to the Nation of Islam leader Louis Farrakhan. Board member Sarah Kurensky told "The Chicago Tribune" efforts are being made to organize and take action in local communities. Marches and rallies are planned in Washington and dozens of cities around the world on January 19th.

JOHNS: The parents of a 16-year-old varsity wrestler who was forced to cut his dreadlocks before a match are breaking their silence. In this viral video, you see a trainer cutting Andrew Johnson's hair with scissors in the middle of the gym. He was told by a referee his hair needed to be cut or he could not compete. Now, Charles and Rosa Johnson's say the referee's conduct appeared more egregious as more information surfaces.

ROMANS: They say the referee was late to the meet and didn't question their son's hair during the initial evaluation. When their son said he could push back his hair, the referee allegedly refused because Andrew's hair wasn't in its natural state. The referee, Alan Maloney, did not respond for comment.

New Jersey athletics officials say he won't be assigned to moderate matches until the incident has been thoroughly reviewed.

JOHNS: Now, we got a health alert for thousands of surgical patients in northern New Jersey. Anyone who had outpatient surgery at health- plus surgery center in Saddle Brook from September 7th to September 28th is being urged to get their blood test. The state health department says unsanitary conditions were found at that facility. Patients may have been exposed to hepatitis B, hepatitis C, and HIV.

No illnesses were reported, and the actual risk of infection is said to be low. The surgery center says it has improved its infection control and sterile processing and also says it's cleaned and repaired all of its instruments.

ROMANS: At least one person was killed when a plane crashed between two homes in Sioux Falls, South Dakota, happened around 5:00 p.m. on Christmas Day. Authorities say one person died. Officials say the two homes sustained heavy damage. A team from the National Transportation Safety Board is expected at the crash site today.

JOHNS: OK, we've got something caught on video for you. A New York City police officer attacked on a subway platform. This officer is seen approaching the group after a woman said she was being harassed by the group of men. The group appeared drunk, refused to leave.

The officer can be heard telling them, step back, I don't want to hurt you. One of the attackers lunged at the officer and falls on the tracks. The bystander who shot the video says he thinks the officer handled the situation well. The men were taken into custody and were told no charges are expected. Wow.

ROMANS: More than $400,000 in donations have been returned to donors who contributed to a bogus Crowdfunding campaign. Kate McClure and Mark D'Amico said a homeless man, Johnny Bobbitt, gave his last $20 to McClure when she was stranded on Interstate 95 so she could put gas in her car. They started the GoFundMe account to thank him. It went viral, 14,000 people loved this Good Samaritan story and donated.

Prosecutors say the story that drove the campaign was predicated on a lie. Prosecutors say McClure and D'Amico squandered the money on a car, high-end handbags, trips and casinos. All three face charges of second-degree theft and conspiracy charges.

JOHNS: That's disturbing.

Now, OK, word of warning. If you're watching this morning with your kids and they know that Santa Claus is real, now would be a good time to go ahead and mute the TV for about 50 seconds while I read the rest of the story.

All right. All right. Now, the question is, did the president give away the grown-up truth about Santa when he spoke to a South Carolina girl on Christmas Eve?

The 7-year-old Collman Lloyd called NORAD to track Santa's progress. She was put through to the president who asked if she was still a believer in Santa. Now, we can hear Collman's side of the story and of that conversation.

[04:20:02] Listen.

(BEGIN VIDEO CLIP)

TRUMP: What are you going do for Christmas?

COLLMAN LLOYD, 7-YEAR-OLD: Probably put out some cookies and then we're hanging out with our friends. So that's pretty much all.

TRUMP: Well, that's very good. You have a good time.

LLOYD: Yes, sir.

TRUMP: Are you still a believer in Santa?

LLOYD: Yes.

TRUMP: Because at 7, it's marginal, right? Well, you just enjoy yourself.

(END VIDEO CLIP)

JOHNS: All the stock market talk, the president may have marginal on the mind. Collman later confirmed to the "Post and Courier" that Santa is real. Her folks said they did not mind the president asking her that and did not find it controversial. After the call, Collman stil set out milk and cookies.

ROMANS: Wait, marginal to a 7-year-old? Marginal is probably not a word a 7-year-old knows. It's non-marginal to a 7-year-old.

JOHNS: Certainly not. OK.

ROMANS: OK.

JOHNS: I know.

Fourteen years to the day after another tsunami devastated Indonesia, the country's regrouping after this weekend's disaster. We're going to go live to Hong Kong.

(COMMERCIAL BREAK)

ROMANS: The desperate search for survivors of a tsunami that hit western Indonesia now entering its fourth day. At least 430 confirmed killed, almost 1,500 injured, and at least 21,000 displaced by the giant wave, 159 are still missing. Now, Indonesia is adjusting the sensors used to detect tsunamis after this one struck without warning.

CNN's Ivan Watson joins us from Hong Kong to explain -- Ivan.

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Good morning, Christine.

Indonesian authorities are under pressure to better protect their long and vulnerable coastline after at least 430 people were killed on Saturday, more than 100 still missing. And tens of thousands worried about going back home for fear of a follow-up tsunami. So, one of the measures, they've announced they'll test this early warning system on the 26th of every month. Take a listen.

(VIDEO CLIP PLAYS)

WATSON: One of the measures.

Also, one of the other agencies has announced that it's going to dial up the sensitivity of its kind of early warning system to test tremors. They say that it was set up to detect earthquakes of magnitude 5.0 or more. And the volcanic eruption on Saturday that is believed to have triggered this tsunami was much lower than that. But they're going to try and respond to improve the system.

The fact is, though, is that Indonesia is very vulnerable to tsunamis. There was a deadly one in September of this year that resulted from an earthquake, killed about 2,000 people. And Indonesian officials have admitted that their early warning system, these buoys that they've had at sea, many have not been functioning since at least 2012.

That is a glaring omission, especially when you consider that a number of countries donated this buoy system after the horrific 2004 tsunami that killed more than 200,000 people across Southeast Asia. Indonesia has to do more to protect this archipelago nation of more than 17,000 islands -- Christine, Joe.

ROMANS: Thank so much for that, Ivan Watson.

JOHNS: Not exactly a festive mood at the White House this holiday.

(BEGIN VIDEO CLIP)

TRUMP: It's a disgrace what's happening in our country. But other than that, I wish everybody a very merry Christmas.

(END VIDEO CLIP)

JOHNS: The president's Christmas day tear on the Democrats and the shutdown and Wall Street in need of a big rebound to close out 2018.

(COMMERCIAL BREAK)