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Stocks Slide at Open; Flynn asks for Leniency; Poll of Democratic Voters. Aired 9:30-10a ET
Aired December 27, 2018 - 09:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:30:26] JIM SCIUTTO, CNN ANCHOR: Well, the trading day just got underway on Wall Street. You see it there. A big drop at the open, 300 points, about a percentage and a third. Investors had been hoping for a repeat of yesterday's record setting performance, but they could be in for a letdown.
Let's bring in CNN's Christine Romans, Alison Kosik.
Alison, I suppose to be expected. You had 1,000 points up yesterday. Probably some folks taking some profits here. But a question I have is, how much of this is people making investment decisions versus machines, trading programs, et cetera?
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: I think you've got a little of both of those reasons as for what happened yesterday, that massive leap, the epic move of the Dow up over 1,000 points, 1,086 points. At this point I think you're -- it's fair to say that euphoria has moved to the sidelines. We've got the Dow down already over 300 points in just the first opening seconds of the opening bell.
Look, this isn't such a huge surprise. When you see an historic move to the upside, and then the next day you see a swing to the downside.
You know, yesterday's move even had some seasoned investors and traders kind of scratching their heads trying to explain yesterday's move. Yes, a lot has to do with the algorithms, the computerized fast trading that goes on here on the floor of the New York Stock Exchange. The other part of it is I think a lot of investors saw the moves that the Dow and the S&P 500 have been making over the past few months. You look at the Dow, since its peak in October, it's lost 5,000 points. So perhaps investors and traders got back in on some sort of bit of positive news and decided to have a buying opportunity. That positive news is really anyone's guess. It could have been Kevin Hassett coming out in front of the cameras and saying that Jay Powell and Steve Mnuchin's jobs were 100 percent solid. That could have been the little bit that moved the needle a little higher and then sort of it caught on probably with the high speed trading.
SCIUTTO: So, Christine Romans, now we hear word that "The Wall Street Journal" reporting that Fed Chairman Jerome Powell is open to meeting with Trump, perhaps just to open channels there between the president and someone who the president has attacked. Calming words for the market going forward?
CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Yes, I mean, I think so. You want these two men to meet. And, you know, presidents from time to time do meet with the Fed chief. The Fed chief often, though, the point of contact is the Treasury secretary. And, by the way, the Treasury Department and the Fed are in constant contact through the New York Fed and the like. They have markets desks who are constantly talking and monitoring conditions in the financial market.
But the issue here is that Kevin Hassett, for the first time, very clearly said the job of Jerome Powell is 100 percent safe. After several days of the president's own tweets and reporting from inside Washington from sources who say the president was asking if he could fire the Fed chief. That is not something the market wanted to hear at all. So I think Kevin Hassett, this White House finally hit exactly the right tone to reassure investors yesterday.
Now, I would caution about the numbers we're talking about. I would look at percentages. Yesterday, a 5 percent rally in the market. That's a big move. Today giving back about 1.5 percent of that.
You know, after, Jim, ten years of a bull market fueled by easy money, interest rates are now going up. There are questions about just how robust growth will be next year. We have a strong economy in this country. Global growth is slowing. I think you are seeing oversold sell-offs, false rebounds and more volatility. And, for investors, that's the way it's going to be for 2019.
SCIUTTO: Yes, yes, listen, as I always say, look at the big picture, right?
SCIUTTO: Christine Romans, Alison Kosik, thanks very much.
ROMANS: You're welcome.
SCIUTTO: A federal judge has put travel restrictions on former National Security Adviser Michael Flynn just ahead of his sentencing. Now Flynn is asking for some leeway.
[09:38:21] SCIUTTO: Michael Flynn is looking for some leniency as his new sentencing date looms in March. The former national security adviser has asked a federal judge to ease travel restrictions on him so he can go back between Rhode Island, where he's from, and Washington, D.C. Right now Flynn is required to stay within 50 miles of Washington starting on January 4th. Flynn was also asked to surrender his passport, but has been approved for a pre-planned international trip.
Let's bring in former White House counsel under the Clinton administration, Jack Quinn.
Jack, thanks for taking the time with us this morning. JACK QUINN, FORMER WHITE HOUSE COUNSEL, CLINTON ADMINISTRATION: Good morning. Thanks for having me.
SCIUTTO: So first on Michael Flynn, because his court appearance a couple of weeks ago was a tough one. It seems he went in there expecting no jail time, then got upgraded by the judge who did not like him implying that he was trapped into lying rather than lying of his own free will. And part of the results of that was coming out, the judge said, let's -- by the way, you can't leave -- you can't go further than 50 miles away from D.C. He'd asked for a request here. Is this the kind of thing a judge like that would grant?
QUINN: Yes, I think it's fairly routine. He's going to Rhode Island on family travel. He's not a flight risk, I don't believe. But the very fact that there were restrictions imposed on him is another indication at how unhappy Judge Sullivan was with General Flynn. And he was -- I mean you can't possibly overstate the judge's unhappiness with his behavior.
QUINN: I mean he compared himself to George Papadopoulos, you know, a relative neophyte in the business of campaigning, the business of politics and certainly knew nothing about the law. Michael Flynn was a former senior intelligence official, ran the Defense Intelligence Agency and then has the audacity to turn around and say, oh, gee, I didn't know it was improper to lie to the FBI. Nobody warned me. I mean that was just so offensive to Judge Sullivan that, you know, he was throwing brick bats at Flynn.
[09:40:27] SCIUTTO: So another message that the judge had for Flynn, which was interesting, was that, listen, the more you cooperate going forward, the better for you, which is interesting because the special counsel's office leading up to that sentencing had made it clear that Flynn has been pretty cooperative so far.
What does the -- how should we read that message from the judge? I mean is there more from Michael Flynn to give?
QUINN: I'll tell you, that's exactly how I read it. I mean the whole proceeding was bizarre. The fact that he essentially, you know, pled that he had either in effective assistance of counsel or, you know, was away when it comes to these proceedings. But, yes, I think that Judge Sullivan believes that Michael Flynn has more to give.
Now, Sullivan knows a lot more about this case than you and I do. He maybe doesn't know as much as Special Counsel Mueller, but he knows an awful lot about the case. And I think it's hard not to interpret his behavior in the courtroom that day as suggesting that he's not yet satisfied that Michael Flynn has done everything he can.
Now, by the way, I think that the sentencing memo that Flynn's lawyers submitted suggested that he hasn't gotten religion on the idea of truthfulness. I mean, that -- you know, the audacity of that memo, which suggested that the FBI was abusive in how they questioned him and poor Michael Flynn, he had no idea, that in itself was an untruthful approach in court that day. And that, I think, is in part what the judge reacted to. But it does suggest to the judge and it suggests to me that Michael Flynn has one or more secrets still to tell.
SCIUTTO: And it was quite a moment in that courtroom, just to remind folks. The judge made Michael Flynn and his lawyers repeatedly, yes, I lied, no, there was no misbehavior by the FBI. I mean it was quite striking. It was like being called up in front of the classroom by your teacher.
Final question here. We're entering the new year. I'm not going to ask you to speculate what Robert Mueller is going to do. A lot of people have speculated and they've been wrong because, you know, Mueller does his job and doesn't let anything leak out. But as a lawyer with a lot of experience, including with independent counsels, do you see this special counsel investigation getting close to a conclusion?
QUINN: Well, look, I will say this with certainty, I think that all of the people, both in the legal community and in the media who have predicted an imminent end to the Mueller investigation have been dead wrong. I think there's no basis for believing that any of them is right today. I think you put your finger on it, Robert Mueller is proceeding methodically to get -- to do his job. And we don't know how long that will take. But he's not going to be -- he's not going to be looking up at some game clock. He's interesting in completing his mission, which is to make a determination whether there was coordination between the Trump campaign and Russia and also to get to the end point of the tangential investigations that have spun out of the Russia investigation --
QUINN: Of which there are many. So, you know, I just don't believe that we are on the brink of a report from the special counsel's office. I think it has some ways to go.
QUINN: I'm a betting man, but I wouldn't bet on this one.
SCIUTTO: All right. Well, it's fair advice.
Jack Quinn, thanks very much.
QUINN: You bet. Thank you.
SCIUTTO: 2020 may seem a long way away, but for several presidential Democratic presidential candidates, the time to decide whether to run is right now.
[09:49:04] SCIUTTO: Somehow, a week can be a lifetime in politics, even a day in the current news cycle, but the next election is just around the corner in political terms. For Democrats, decision time on a 2020 run is fast approaching. And a new poll from "USA Today" and Suffolk University might help make up some minds. For instance, ask whether they'd be excited to see Joe Biden on the 2020 ballot, 53 percent of Democratic and independent voters said yes. Just 24 percent said no. Bernie Sanders fairing less well, more noes, as you can see there, than yeses. But the biggest yes score of all goes to someone new, anyone new. Someone new we may not know yet. The biggest no, Hillary Clinton. That's a remarkable number there, 70 percent saying she should not run.
Joining me now to break this down and to look ahead, Joe Lockhart, he's former White House press secretary for Bill Clinton.
Joe, thank you for joining us this morning.
JOE LOCKHART, CNN POLITICAL COMMENTATOR: Glad to be here.
[09:50:00] SCIUTTO: So, big picture, you've got a lot of experience in politics. We are, what, 677 days away from voting day 2020. Do these early polls tell us anything important? Do they have real relevance?
LOCKHART: I don't think so. I do think that 2018 midterms tell us a lot for everybody except for Joe Biden. I think he's in a separate category. He has such a reservoir of goodwill among Democrats for his work in the Senate and the vice president and his personal story that I think he's separate and apart.
But for everybody else, I don't think it really means very much. But if you look back a little bit, you're looking at people, I think it's going to be a bad year for white male establishment candidates who aren't Biden. I think people are looking for something different. Women, people of color, I think those -- that's kind of the dynamic. And I think the poll shows a little bit of that.
SCIUTTO: So give me a sense of who that is because -- I mean this field, it's got 30-some odd at least putative candidates there. I mean is it someone -- do you see someone in that giant field who would qualify -- and there's the list right there -- who would qualify as someone new in the view of Democratic voters?
LOCKHART: Sure. I mean I think if you look, there's a series of women I think who are intending to run, whether it be Amy Klobuchar, Kirsten Gillibrand, Kamala Harris. I think they will have an advantage because, again, I think that really is a movement that we've seen from Democratic voters.
You know, you have the two candidates who came up short, or actually three candidates who came up short, but really made a name for themselves, Andrew Gillum, Stacey Abrams and Beto O'Rourke.
And then, you know, you've got some -- you've got a couple other categories. You've got the businessmen, Mike Bloomberg and Howard Schultz. You know, I think it's -- I'm not sure what their case will be. And you've got some governors, Governor Bullock, Hickenlooper.
Again, I think, you know, it's going to be -- the ideal candidate, if Joe Biden decides not to run, you know, I think is a woman, maybe a woman of color, who can excite the base and who the base believes is someone who can take Trump on, you know, head to head, and not, you know, shy away or shrink away.
SCIUTTO: Interesting in this poll, I mean you could look at the positives, but you can also look at the net negatives as indicators here. When you look at it, Cory Booker, Kamala Harris, Beto O'Rourke, they all have net positives, basically folks who are excited about them to run versus the numbers of folks who don't want them to run. But you look at Elizabeth Warren, Bernie Sanders, and Hillary Clinton in particular with a very high should not run figure there.
How important is that? And should that be an indicator to them that this is really just not their year?
LOCKHART: Well, listen, I think everybody should make their case. And, you know, I think for anyone who runs for a first time, it almost always enhances their reputation. When you start running for a second time or a third time, that's when you run into a little bit of trouble. I don't expect Hillary Clinton to run. So I'd put her to the side.
You know, there are a lot of supporters out there for Bernie Sanders and Elizabeth Warren, but I really do think, as this poll indicates and from what I hear from people is people want someone new, they want someone that's fresh and exciting. And, you know, again, I don't -- I started by saying I wouldn't put too much credence in these numbers. But I do think that, you know, those who ran in the past are, you know, are not, again, with the exception of Joe Biden, you know, are not the fresh faces that people are looking for.
SCIUTTO: Joe Lockhart, wish you the best to you and your family this holiday.
LOCKHART: Same to you, Jim.
SCIUTTO: A high school referee is now under scrutiny after a black wrestler was forced to cut his hair in order to compete in a match. Look at the pictures there. Now that ref will not be working with that district for a while.
[09:58:37] SCIUTTO: Eruptions from the Indonesia volcano, look at those pictures there, that triggered a deadly tsunami last week are so strong now that officials have raised the threat level there. Thousands of people are being evacuated from nearby islands over fears of even more tsunamis. Flights being rerouted as a precaution.
Here at home, a New Jersey school decides vows not to send its sports teams to any events where a referee who forced a teen to cut off his dreadlocks is still officiating. The Bueno (ph) Regional District took the strong stance in protest of a referee at an emergency meeting just last night. You may have seen this remarkable video of a trainer cutting Andrew Johnson's hair in the middle of a gym, in the middle of a match last week. A referee had told Johnson that his hair was too long and that he had to cut it or forfeit the match. A move that isn't sitting well with parents.
(BEGIN VIDEO CLIP)
RACHEL GREEN, CIVIL RIGHTS DIRECTOR, ACTION TOGETHER NEW JERSEY: This young man will never ever forget the physical and mental toll you took that night. He will never forget it. As a mother raising children in this community, it broke my heart. It didn't matter if he was black, white, green, or purple, it broke my heart to watch that young man stand there and be humiliated like that.
(END VIDEO CLIP)
SCIUTTO: The state's athletic association is now investigating this case. The referee has not responded to CNN's request for a comment.
[10:00:05] Top of the hour. Thursday morning here. I'm Jim Sciutto.
President Trump is back at the White House this morning