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Early Start with John Berman and Zoraida Sambolin

Wall Street Reopens After Worst Christmas Eve Ever; President Trump Wallows In Grievance For Christmas; An 8-Year-Old Boy Dies In U.S. Custody On Christmas Eve; Indonesia Adjusts Sensors To Detect Tsunamis. Aired 5:30-6a ET

Aired December 26, 2018 - 05:30   ET

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

[05:30:00] (BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: -- 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.

CHRISTINE ROMANS, CNN ANCHOR: For the second time this month, a migrant child dies in U.S. custody after crossing the border. Overnight, customs promising changes.

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

Welcome back to EARLY START. It is 30 minutes past the hour. I'm Joe Johns.

ROMANS: Nice to see you this holiday week.

JOHNS: Nice to see you.

ROMANS: I'm Christine Romans. It is Wednesday morning.

Can Wall Street recover after suffering the worst Christmas Eve declines ever? Markets fell after the Trump administration sent out confusing signals about markets and the economy.

U.S. futures are higher right now.

In Asia, the Nikkei closed out nearly one percent after a five percent rout on Christmas Day. The Shanghai closed down slightly. The Hong Kong stock market was closed for a public holiday.

European markets are closed this morning, as well.

As stocks fell Christmas Eve, the president renewed his attacks on the Federal Reserve, tweeting this. "The only problem our economy has is the Fed." And, President Trump is growing more frustrated with his Treasury Sec. Steven Mnuchin despite Mnuchin's attempts to calm Wall Street. A source told CNN Sec. Mnuchin could be in serious jeopardy with the president. However, the president vouched for him publicly, shifting blame for market volatility to the Federal Reserve, instead.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Do you have confidence in Secretary Mnuchin?

TRUMP: Yes, I do. A very talented guy, a very smart person.

UNIDENTIFIED MALE: What about the Fed chair?

TRUMP: Well, we'll see. They're raising interest rates too fast -- that's my opinion -- but I certainly have confidence. But I think it'll 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 as a form of safety -- no way.

President Obama didn't do much of that. It's 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 record kinds of numbers.

So I think it's a tremendous opportunity to buy.

(END VIDEO CLIP)

ROMANS: So, a buy recommendation from the President of the United States -- never heard that before.

Look, investors do not like the president's repeated attacks on the Fed. "The Wall Street Journal" reports former economic -- senior economic officials privately warned this president and 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 is near a bear market, down 19.8 percent from its high point October third. You are watching the death of the longest bull market in history.

JOHNS: And it's also the second day of Christmas -- the fifth day of this government shutdown we're in the middle of. President Trump said yesterday the government will not reopen until he gets his border wall funding he's demanded.

He started Christmas with a phone call to U.S. troops around the world. After that, the Grinch comes in. The president made clear he's not ready to ease his demands for a border barrier. He offered no 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 the 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)

ROMANS: The effects of the shutdown will really start to be felt today. Staffing at the office overseeing federal food stamps will be cut by 95 percent. The Department of Health and Human Services estimates nearly 8,000 federal employees will not return to work.

All right, let's bring in "Washington Examiner" senior congressional correspondent David Drucker, a CNN political analyst. Good morning.

And, you know, you'll start to see the effects of the shutdown start to compound as we go forward here. You know, when people start to file for new -- for new --

JOHNS: Unemployment, right.

ROMANS: Or social security claims and the likes -- new claims.

But the president says that federal workers -- they're fine with the shutdown because they want the wall -- listen.

(BEGIN VIDEO CLIP)

TRUMP: Well, I think they understand what's happening. They want border security. The people of this country want border security, you know.

It's not a question of me. I'd rather not be doing shutdowns.

And many of those workers have said to me and communicated stay out until you get the funding for the wall. These federal workers want the wall.

(END VIDEO CLIP)

ROMANS: Is that, David Drucker, inside the Beltway, the view among federal workers who are not being paid? Is that -- is that the conventional view? [05:35:02] DAVID DRUCKER, CNN POLITICAL ANALYST, SENIOR CONGRESSIONAL CORRESPONDENT, WASHINGTON EXAMINER: Well, I don't think it's really any view. I mean, there are some federal workers that are members of Congress that support the president's position on the shutdown and border security, so -- but perhaps the well wishes on his shutdown are coming from those corners.

Look, I think that -- I think what's happening with this shutdown -- and it's understandable if the president wants to use this mechanism as a means to extract concessions from Democrats -- and Republicans have tried to do this with Democratic presidents in the past -- so that's fine. And voters, I think, over the next few weeks or possibly months will make a decision on this.

But I do think -- and the president said something interesting in there. He said it's not really about me, it's about border security. But, in fact, border security right now is wrapped into Trump and it's all about Trump.

I think if you were to separate out the issue of border security and a border fence or a border wall, wherever it's applicable along the southern border, I think you'd find -- generally speaking, among the electorate nationally, you'd find a lot of support for it.

But because it's wrapped up in Trump and it's branded as Trump's wall, it's going to have a lot of trouble receiving the support it needs from Democrats to get done.

And it reminds me, Christine, a lot about Obamacare and the polling during the Obama years. When people would ask about healthcare policy, a lot of things that were in Obamacare would get high marks. Then you'd ask about Obamacare and everybody would say --

ROMANS: Yes.

DRUCKER: -- oh, forget that -- we don't like it.

ROMANS: Yes.

DRUCKER: I think that is what is happening with a lot of the president's border security policies and that's hurting his ability to get what he wants.

JOHNS: Now, the president has said something just the other day that he's said before. He's talked about congressional oversight as harassment -- presidential harassment.

And on the one hand, you think it's just the president talking and sort of venting his frustrations as he's wanted to do, but we also know this is the very same president who tried to discredit, again and again, the Mueller investigation in every stage.

The question is, do you think it's more calculated -- the president calling what the Democrats are going to do in the House presidential harassment? Is it calculated to say discredit congressional oversight? DRUCKER: Well, either way, this is how Trump operates. It's always hard to climb inside his head and figure out what is actually motivating what he says at any given time.

But it wouldn't be surprising if the president was trying to undercut the incoming Democratic majority in the House. He knows they're going to come after him at this point. He knows that they're going to investigate him very aggressively. They're going to issue subpoenas.

There are going to be Democratic chairman that are going to do a heck of a lot more than the Republican chairmen of the relevant committees ever did. Oversight and government reform, energy and commerce, just to name a few -- judicial.

And so, the president and his White House is going to be dealing with a firestorm of inquiries and he's going to try and win this in the court of public opinion, especially as his reelection draws nearer. And the way you do that is to try and reframe government oversight by the Legislative Branch of the Executive Branch -- which is what they're supposed to be doing -- as harassment.

I don't know at this point that the president is going to be able to win this argument. We have -- you know, after 2016, we were absorbing all of that political information and fallout and what it meant for where voters are.

But we've had now another election and we know that the president's brand of behavior, his brand of language, it does not play well in the middle. It doesn't play well with soft Republicans or Independents, and so I'm not sure he's going to be able to win this battle.

But it also depends on how far Democrats want to push this and whether or not voters find that unreasonable, as well.

ROMANS: I've got to tell you, there's -- you know, he's not inspiring confidence among investors at the moment, either.

DRUCKER: Yes.

ROMANS: And the response from his administration -- you know, this odd statement on Sunday saying there's ample liquidity in the system. News flash -- no one thought there wasn't ample liquidity in the system.

One wonders if they can get sort of a coherent message here going forward with the president, who is prone to just lashing out at the Fed chief on Twitter.

DRUCKER: Yes, I don't think coherent message in this president and this White House exists and it's precisely as you said, Christine because the president just says whatever he thinks at any given time. He doesn't even give the people surrounding him a chance to catch up and get on the same page.

And I think for a government shutdown and questions of policy, we can abate these things. The country is really good at absorbing these things. So are the -- is the economy and so are the markets.

ROMANS: Yes.

DRUCKER: But when you're intervening directly in the markets, when you're battling with the Fed chairman, and when the administration is trying to cast blame on what the markets are doing over here and over there, you combine that all with what's going on with U.S. foreign policy -- what appears to be an abrupt Syria pullout, potential Afghanistan pullout -- all of this instability directed solely out of the Oval Office, at the whim of the Oval Office, is the kind of thing markets hate.

It's also the kind of thing that is contra what has made U.S. markets so resilient, even during the Great Recession --

ROMANS: Yes.

DRUCKER: -- because there was no safer, more stable --

ROMANS: Yes.

DRUCKER: -- place to put money around the globe than in U.S. markets. And all of a sudden we don't look as stable. We don't look as sort of political secure as we once did.

[05:40:08] And I think that's where the president is in the biggest political danger.

But it's also where the economy, which has been running pretty smoothly, is in trouble because people -- when people don't know what to expect from markets or what the president might do at any minute, it just makes it very volatile. Markets don't like volatility and neither do investors. And that will trickle down to Main Street eventually if this continues.

ROMANS: Yes. It's been an ugly year for stock investors. You know, the worst year in a decade, so --

JOHNS: All right.

ROMANS: -- we'll see how it opens in about three hours, four hours.

Thanks so much, David Drucker.

DRUCKER: Thank you.

JOHNS: Customs and Border Protection 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 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. But at this point, they do not have an official cause of death.

According to the time line 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 and 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.

Now, 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 Protection agents.

Now, the head of Customs and Border Protection is ordering immediate action. The new steps include secondary medical check-ups on all children in CBP custody, adding capacity for medical assistance for 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 reviewing options to relieve capacity issues in border checkpoints in El Paso, Texas. ICE is expected to drop off 1,200 migrants in the region over the next few days, according to Congresswoman-elect Veronica Escobar.

Four hundred eleven migrants were brought there Sunday. Two hundred sixty migrants dropped off on Monday. At least 180 were there Christmas Day.

ICE drops off the migrants without providing food, shelter or transportation. ICE said it has limited options to remove families in the U.S. illegally, blaming decades of inaction by Congress.

ROMANS: All right. What if you really don't want another sweater with jingle bells or cologne or ties?

JOHNS: Yes.

ROMANS: That's your pet peeve, right? Consumers are ready to head back to stores to return those unwanted

gifts and we have tips to make returning a little easier. "CNN Business" is next.

(COMMERCIAL BREAK)

[05:47:03] JOHNS: A desperate search for survivors of a tsunami that hit Western Indonesia now entering its fourth day. At least 430 people now confirmed killed, almost 1,500 injured, and at least 21,000 displaced by the giant wave.

Now, Indonesia is adjusting sensors used to detect tsunamis. 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, Joe.

We're learning more about the cause of this deadly tsunami and some of the measures that the Indonesian government is doing to try to protect its citizens.

This is some satellite photography that shows the volcanic island called Anak Krakatoa (Child of Krakatoa) before and after the eruption on the 22nd of December when, according to Indonesian authorities, some 150 acres of the mountainside tumbled into the ocean and sent that deadly wave hurdling towards the coast on both sides of the Sunda Strait.

Now, the authorities say that their seismometers -- their detectors were not rigged, basically, to detect something of this magnitude. That they're set up to detect earthquakes of 5.0-magnitude or more and this was actually much lower if you can believe it. So they're adjusting those sensors.

They're also starting to test their siren early warning system. Take a listen.

(BEGIN VIDEO CLIP)

Siren warning system.

(END VIDEO CLIP)

WATSON: Now, some of this is a little bit too little, too late because Indonesia is very vulnerable to tsunamis. There was a horrific tsunami in 2004 that killed hundreds of thousands of people in Indonesia and across Southeast Asia. Actually, this is the 14-year anniversary of that.

A number of countries donated to Indonesia to help it set up buoys to help detect these types of waves approaching, but the authorities say a lot of those had fallen into disrepair by as early as 2012, and they were not operating last September when another deadly tsunami struck. So they have to get this back up into gear. Meanwhile, some of the recovery efforts hampered by flooding in some of the areas already devastated by the tsunami. Very challenging work on the ground for survivors and rescue workers -- John.

JOHNS: And it sure looks like it was foreseeable, at least for the last 14 years.

Thanks so much for that, Ivan Watson in Hong Kong.

ROMANS: All right. Will global stocks stabilize here? Will they be able to rebound from a Christmas Day rout?

The Nikkei closed up about one percent. It had been down five percent on Christmas Day, so I'd call that stabilizing. But, Shanghai closed down and the Hong Kong market was closed for a public holiday.

European markets are also closed for Boxing Day.

On Wall Street, futures are higher. Markets reopen today after closing Christmas. Stocks on pace for their worst December since the Great Depression.

[05:50:05] The Dow is now down 15.6 percent this month. The S&P down a little bit more than that. And the Nasdaq is down 16.7 percent. You know, everything negative on the year and the S&P is now near a bear market.

It's the thought that counts, of course, but what if you really don't want another reindeer sweater with jingle bells? According to the National Retail Federation, 17 percent of consumers are going to go to return or exchange unwanted gifts -- 17 percent.

Some retailers have a 'no questions asked' policy; others have strict rules that make returning purchases frustrating or impossible.

What can you do to make those returns easier?

Don't open the box, especially for electronics. Don't remove the packaging on a gift you don't want. You risk a restocking fee if packaging isn't exactly intact and if the products are missing any tags you may be stuck with them.

Keep the gift receipts. Don't throw them out with the wrapping paper. Some retailers will not let you return a gift without a receipt. Others will give you store credit if you beg.

Check return policies. Note time limits. There probably are time limits and you can check all those online before you go and wait in line at the store. During the holiday, some retailers will extend their deadlines, often until late January.

You might have to bring an I.D., too. Some chains, like Victoria's Secret -- they use this computerized return authorization system to detect fraud and abuse. They look at how many times a consumer has returned items. So you may be asked to show your driver's license or another I.D. when you return in person. JOHNS: The only one -- just give me a gift card. Gift card, OK?

ROMANS: But, you know, there's a significant percentage of gift cards that are never redeemed.

JOHNS: Really?

ROMANS: People get them and then they forget about them. So I get worried giving gift cards.

JOHNS: Yes.

ROMANS: The National Retail Federation is going to be mad at me, but I don't care. I get worried giving gift cards because so many people never use them.

JOHNS: Right. Well, I'll tell you what, I'll use mine.

ROMANS: I'll give them to you -- all right.

JOHNS: Absolutely.

All right, we'll be right back.

(COMMERCIAL BREAK)

[05:55:00] ROMANS: As record numbers of Americans hit the road for the holidays, huge sections of the country will see strong winds, heavy rain, and mountain snow. That storm system pushing east now with millions under winter weather alerts.

The latest now from Pedram Javaheri.

(BEGIN VIDEOTAPE)

PEDRAM JAVAHERI, AMS METEOROLOGIST: Joe 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 as we have warm, moist air coming right off of the Gulf, but also seeing a concern here for some 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. Work your way back towards eastern Colorado, on into Nebraska and Kansas as well.

But the system, as it pushes off towards 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 towards the west where 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 that mild air eventually does want to push up towards the northeast here as we got into towards the weekend. In fact, look at these temps here in New York City, up to almost 60 degrees. And then, the bottom drops out wrapping up 2018 with temps that are more seasonal for this time of year -- guys.

(END VIDEOTAPE)

ROMAN: All right, Pedram. Thank you for that.

The Women's March slated for Chicago next month has been cancelled. The past two marches drew hundreds of thousands of people to Grant Park in conjunction with other marches worldwide.

Organizers say the upcoming event was scrapped because of high costs and a volunteer shortage, but it comes as the movement's national founders face scrutiny over allegations of anti-Semitism and their connections to Nation of Islam leader Louis Farrakhan.

Board member Sara Kurensky told the "Chicago Tribune," "Efforts are being made to organize and take action in local communities."

Marches and rallies are still 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 video, you can 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 couldn't compete.

Now, Charles and Rosa Johnson say the referee's conduct appears more egregious as more information surfaces.

ROMANS: Look at the coaches and trainers trying to like --

JOHNS: Right, yes.

ROMANS: -- really buck him up there.

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 it back, the referee allegedly refused because Andrew's hair, quote, "wasn't in its natural state."

The referee, Alan Maloney, did not respond to CNN for comment. New Jersey athletic officials say that ref won't be assigned to moderate matches until the incident, quote, "has been thoroughly reviewed."

All right, try to top this Christmas gift.

Pitcher Brady Singer was drafted this year by the Kansas City Royals. He got a $4 million signing bonus. So for Christmas, he sent his parents a letter thanking them for all they sacrificed helping him play baseball. The letter ends with an impressive gesture.

(BEGIN VIDEO CLIP)

JACQUELYN SINGER, KANSAS CITY ROYALS PITCHER BRADY SINGER'S MOTHER: The money you spent on traveling, gear, hotel, food, and all those Gatorades I drank is much more than I could ever give you, but there is something I want to give to you.

I am paying off the loan from the bank. Also, I paid off all your debt, as well. What?

Now, instead of trying to save money every weekend to replace the savings account you drained on traveling to see me play baseball, you can spend it on yourselves.

(END VIDEO CLIP)

ROMANS: Oh my God.

JOHNS: What a moment.

ROMANS: Singer paid off all his parents' debts. His letter concludes, "Your giving hearts helped to shape my tiny dream into a reality."

Awesome.

JOHNS: That's just amazing.

ROMANS: Awesome.

JOHNS: If you didn't love your Christmas gifts, you could always try Mega Millions. There was no winner last night. It was the largest- ever Christmas Day jackpot. That means Friday night's jackpot jumps to an estimated $348 million.

The winning numbers: 2-8-42-43-50, Mega Ball 6.

ROMANS: That's only if you don't have your kids to pay off your debts.

JOHNS: That's just amazing.

ROMANS: All right, thanks for joining us, everybody. I'm Christine Romans.

JOHNS: And, I'm Joe Johns. "NEW DAY" starts right now.

(BEGIN VIDEO CLIP)

CASAREZ: Customs and Border Protection is saying an 8-year-old boy has died while in their custody.

VERONICA ESCOBAR (D), CONGRESSWOMAN-ELECT, TEXAS: These tragedies are happening because Congress and the administration have not adequately provided resources. UNIDENTIFIED FEMALE: To have it happen in U.S. custody twice, it's beyond words.

TRUMP: The government's not going to be open until we have a wall.

UNIDENTIFIED FEMALE: The American people, they are all caught up in this political brinksmanship and, frankly, the president throwing a temper tantrum.

UNIDENTIFIED MALE: For him, I think it's about pleasing his base. Where does that end? I don't know.

UNIDENTIFIED MALE: Financial markets are struggling after a dismal December.

TRUMP: They're raising interest rates too fast, but I think it'll straighten.

SEN. CHRIS COONS (D), DELAWARE: The independence of the Fed is key. I plead with the president to reconsider what is a very dangerous course.

(END VIDEO CLIP)

ANNOUNCER: This is NEW DAY with Alisyn Camerota and John Berman.