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No Signs of Deal to End Shutdown; Children Received Medical Screenings; Biggest Single-Day Gains on Dow; Transformation of Donald Trump; Major Snowstorm Heads East. Aired 6:30-7a ET

Aired December 27, 2018 - 06:30   ET

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

[06:30:00] DAVID DRUCKER, CNN POLITICAL ANALYST: John, and we don't really know how the politics of this shutdown is going to play out. You know, we are conditioned to have shutdowns where Republican- controlled Congresses, or at least one chamber of Congress, fights with a Democratic president, makes demands and says I won't -- I will not open the government, I'll shut it down, if you don't agree.

In this case, we have a Republican president with a Republican Senate and the demand is coming from the other direction of Pennsylvania Avenue. So I think this is sort of an unknown.

I think part of --

BRIAN KAREM, CNN POLITICAL ANALYST: But the president claimed it, David, the president --

DRUCKER: Well, I think part -- yes, right, the president claimed it, but eventually voters may make a decision that everybody needs to compromise --

KAREM: That's true.

DRUCKER: And they may understand what the president said, but said, look, Democrats now control the House of Representatives. They have a responsibility to compromise with the president the same way he has a responsibility to compromise with them.

KAREM: Who blinks first?

DRUCKER: And I think a lot of this is going to be decided by how both sides actually get together. What Democrats have in their favor is this, the president, at the end of the midterm campaign in the final weeks campaigned on caravans and a wall and voters said no. And so I think, for now, because this is wrapped up in Trump, Democrats have an advantage. But if he can get away from some of his rhetoric and just talk about boarder security, I think that there could end up being some pressure on Democrats to meet with him in the middle. Right now they don't see any incentive or pressure to meet him in the middle.

KAREM: The president would see that as weakness.

DRUCKER: And that's why the government remains shut down.

KAREM: The --

JOHN BERMAN, CNN ANCHOR: All right, David, Brian, Alice, thank you very, very much. I think we'll be able to talk about this tomorrow and well into next year. I don't think there's an end --

ERICA HILL, CNN ANCHOR: I think there's a good chance, yes.

BERMAN: I don't think there's (INAUDIBLE).

KAREM: Happy New Year.

BERMAN: Yes, happy freakin' New Year, everybody.

All right --

ALICE STEWART, CNN POLITICAL COMMENTATOR: Thanks, John.

BERMAN: Historic losses followed by record-breaking gains. The whiplash on Wall Street. We have new developments this morning. Christine Romans here to tell us where the premarket trading is headed, next.

(COMMERCIAL BREAK)

[06:35:24] BERMAN: All right, new this morning, the head of Customs and Border Protection is reiterating his call for Congress to help after the death of a second Guatemalan child in U.S. custody. The secretary of Homeland Security now says that all children in the agency's custody have received medical screenings.

CNN's Dan Simon is live in El Paso, Texas, with the very latest.

Dan.

DAN SIMON, CNN CORRESPONDENT: Well, John, with two children dying in less than a month, there are fresh concerns whether or not the Border Patrol is well-equipped to handle the surge of Central American migrants come into the country. Well, one CBP official put it in very stark terms, telling us, quote, we're not designed to hold all these people. A complete overhaul needs to happen. We're overcrowded, under staffed. We don't have the manpower to deal with this crisis.

Well, Homeland Security Secretary Kirstjen Nielsen is facing a fresh, new crisis. She is ordering her agency to enhance medical screenings at the border. She herself is headed to the border later in the week to monitor some of these screenings. But we don't know the exact details in terms of how this seven-year-old who died, Filipe Gomez Alonzo died. We don't know if he became ill while crossing the border or if it was while being in custody.

What is clear is there is an unprecedented number of migrants coming into the country. More than 25,000 families were arrested in the past month. And the system is just jammed with these migrants. And that's why, over the past few days, here at this Greyhound bus station in El Paso, we saw hundreds of migrants just being dropped off here in the freezing cold. And that in itself created its own PR nightmare. That process seems to have stopped. And now there is better coordination with some of the area shelters. But as that CBP official put it, this is a nose bleed that just won't stop.

Erica.

HILL: All right, Dan Simon with the latest there in El Paso. Dan, thank you.

It is time now for "CNN Business." Wall Street -- you might want to buckle up for this next report -- a record-breaking rebound on Wednesday. Investors, though, understandably nervous despite that big rally. So what's going on?

Chief business correspondent Christine Romans joins us now with more.

So you have all the answers.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Wow. Wow. Yes, I do. If I had all the answers, I would be on a Caribbean island, quietly.

BERMAN: You would own the Caribbean island.

HILL: I've got a magic eight ball somewhere.

ROMANS: I would own several of them.

Look, Santa Claus showed up a day late, that's what happened here, and stocks staged this miraculous comeback from their worst ever Christmas Eve. The Dow soared more than 1,000 points. You have never seen those numbers on that screen before because it's never happened before. The most points in one day ever. That's a 5 percent rally. That's a big rally. Although percentage wise, not even in the top 20. So keep that in mind.

The S&P 500 also rose 5 percent. The Nasdaq jumped 5.8 percent. That pulls the Nasdaq out of bear market. It was the biggest percentage gain for all three since March 2009. And remember what was happening? The economy was cratering, the stock market cratered, and then it started to rally.

Here's how the rest of the world, though, is responding right now. I want to show you. You saw Tokyo jump, but Shanghai and Hong Kong were lower. And London, Paris and Frankfurt are now down and so we're watching this response. It's not carrying over into European trade, and that's important to note. And U.S. stock index futures right now are also lower. You're looking at about a 300-point decline on the Dow. So taking back some of those gains yesterday.

Look, Wednesday was a respite, though, from what has been a very rough month for investors. Even after the rally, the S&P 500 is close to entering a bear market, which would end the longest bull market in history. This month still on pace for the worst December since the Depression.

Now, the White House tried a new approach and it worked to reassure investors. They sent the chairman of the Council of Economic Advisers, Kevin Hassett, to speak with reporters.

(BEGIN VIDEO CLIP)

QUESTION: You made it very clear that Secretary Mnuchin's job is safe. Is the Fed chairman's job safe?

KEVIN HASSETT, CHAIRMAN OF THE COUNSEL OF ECONOMIC ADVISERS: Yes, of course, 100 percent, yes.

QUESTION: One hundred percent the Fed chairman's job is not in jeopardy by this president?

HASSETT: Absolutely. That's correct.

(END VIDEO CLIP)

ROMANS: The president, of course, has bashed the Fed chief on many occasions and said the Fed is raising interest rates too fast. Hassett also said the U.S. economy is strong.

(BEGIN VIDEO CLIP)

HASSETT: All the anecdotal information we're getting is that the fundamentals remain extremely sound. That Christmas sales were through the roof. GDP in the fourth quarter is looking like it's going to be very close to if not above three again. And so I think that the momentum that we saw this year is carrying forward to next year.

(END VIDEO CLIP)

ROMANS: He blamed the market volatility on fundamentals. He noted growth in Europe has slowed, growth in Asia has slowed. Overall, the economy, though, is strong.

Guys, this is what it looks like at the end of a 10 year long bull market fueled by easy money. You've got big selloffs that get overdone, and then snap back rallies that are, you know, also overdone and can be reversed again. So I think volatility is the big word of the moment and will remain so.

BERMAN: And not for the faint of heart.

ROMANS: No.

HILL: No.

ROMANS: No. But, look, take the long view. You know, you're still up. Your 401(k) has, what, quadrupled over the past 10 years. So, you know, rebalance.

[06:40:03] BERMAN: It's like a 301(k) this year, though.

ROMANS: OK. There you go.

BERMAN: It's down a little bit.

ROMANS: First down year in 10 years. First -- biggest down year in 10 years. That's something. We'll see.

BERMAN: All right.

HILL: Christine, thank you.

BERMAN: All right, so one of the enduring mysteries surrounding candidate and now President Trump, are there secret tapes from "The Apprentice," outtakes, where he says offensive, racist things? A brand new report out in "The New Yorker" just moments ago takes a look at these years and the producer behind this epic series.

(COMMERCIAL BREAK)

BERMAN: All right, that's part of the open for "The Apprentice," of course. You see one-time reality star Donald Trump there, and his kids. That was all before he was a presidential candidate. Fourteen seasons on that show helped transform him from the target of tabloids to ultimately something of an American icon.

Patrick Radden Keefe has a piece in the new issue of "The New Yorker" which profiles Mark Burnett, the creator of "The Apprentice" and "Survivor," but it also really has a fascinating look at the sort of rise of the new Donald Trump.

And Patrick joins us now.

Great to have you here with us. Thanks so much.

As one of the projects that you did, this piece -- it looks like you worked on it for years, too.

PATRICK RADDEN KEEFE, STAFF WRITER, "THE NEW YORKER": It took a while.

BERMAN: And it was a long time.

HILL: There's a lot in there.

BERMAN: But you -- you went back and watched many episodes of "The Apprentice" and note that now that Donald Trump is president, there's nothing ironic about the filming or the depiction of then businessman Donald Trump in these shows.

KEEFE: Well, this was one of the mysteries for me. I lived in New York City in the 1990s, and I remember the kind of figure that Trump was and the culture. And he was a little bit of a joke at that point. He had had a bunch of bankruptcies. He was in the tabloids all the time. And there's Trump before "The Apprentice" and then Trump after. And he's completely transformed.

[06:45:11] So I went back to look at the show and think, you know, is -- are they portraying this guy as this real icon? Is it a little tongue and cheek? And, to me, it wasn't at all.

HILL: It's fascinating too, as you walk through, you know, how Mark Burnett came to -- came upon Donald Trump and sort of found his man. What's fascinating to me is he figured out, too, one of the best ways to appeal to Donald Trump is through flattery. And even going to the point where he says -- I mean this was in 2013 he was talking about it -- I need to show respect to Mr. Trump, he said. And this was when he was at a skating rink here in Central Park, which Donald Trump had leased at that point, didn't own, and he started talking about the Trump Wollman skating rink. The Trump Wollman skating rink is a fine facility, built by Mr. Donald Trump. Thank you Mr. Trump because the Trump Wollman skating rink is the place we are tonight and we love being at the, again, Trump Wollman skating rink.

He figured out, as many times as he could say Donald Trump, and attribute this to him, it worked. And Donald Trump came over afterwards with effusive praise and talk about a love affair.

KEEFE: And says, you're a genius.

HILL: Yes.

KEEFE: No, exactly.

No, this is, I think -- I think this is Burnett's genius. He was this British paratrooper. He had had -- kind of came from humble beginnings, joined the army in his teens. Came to California afterward and wanted to make it in the TV business. And one of his great insights was that it's all about the -- kind of the handling of talent. And I think he saw a charisma in Trump that other people hadn't necessarily seen. He realized this guy could be magnetic on television, in good ways or bad ways depending on your point of view, and he fixed on that and made Trump a star.

BERMAN: And he was better at it even when he wasn't on script. He couldn't stay on script, as you know. But even then he was better television.

KEEFE: Well, this was part of what was amazing. I talked to a bunch of people who worked on "The Apprentice" over the years and they said, yes, you'd give Trump a script and he couldn't read it. He'd be tripping over the words. It was a disaster. But off the cuff, when he's just improvising, he had this kind of zesty banter thing where he'd insult people and he was, you know, a little pushy and kind of imperious. And on TV, that's magic. You know you can't -- you can't -- you'd want to bottle that.

HILL: He also really went with his gut, too, you point out. That's one of the things that the editors had to deal with, that -- that Donald Trump would go with his gut on the show, which wasn't always what they expected. And they had to sort of edit in reverse.

KEEFE: Well, this was one of the things that really knocked me out in the reporting is talking to the point who edited "The Apprentice." So they would shoot -- for every hour of TV that you watched, they would shoot 300 hours of footage over the course of a week, all these different cameras following different people. And sometimes you'd have a real standout candidate who did a great job and was really the best person and should be the one to, you know, kind of go home a winner that week, but Trump would show up in the boardroom at the end of the week and he hadn't been paying attention to what came before, he would just show up and he'd decide he didn't like that person or, you know, they bothered him on that particular day and he would fire them. So then the editors have to go back and figure out, well, what's the story we can tell here where it makes sense that he fired the best person? And I talked to one of the editors and they said, you know, I take a little comfort looking at the White House and knowing that now his staff has to do the same thing.

HILL: Wow.

BERMAN: It's -- honestly, it's the White House. It's people having to reverse -- there have been articles written about how he has to reverse engineer -- White House staffers have to reverse engineer actions based on things that he impulsively does. And That's exactly what that sounded like.

KEEFE: That whole pattern was established on "The Apprentice."

BERMAN: All right, Mark Burnett, creator of "The Apprentice," creator of "Survivor," reluctant a bit to talk about politics and the Trump presidency, which people that you spoke to for this article found somewhat puzzling.

KEEFE: Yes, I mean, I talked to a whole bunch of people who were involved in every aspect of "The Apprentice," and a lot of these people now, you know, have doubts about how they feel about all of this and they look back, on the one hand this was a great professional experience, on the other hand a number of them told me, without that show, Trump would never have become president.

Burnett remains friends with Trump. He's not out here -- he's not going to be on CNN as like a Trump proxy or defender, but he's also not condemning Trump. They're still close. They still talk. But I think it's a -- it puts him in a complicated position.

HILL: Do you think part of that is because he -- he has seen what can happen if you do go against Donald Trump?

KEEFE: I think that's right. And I think, you know, it's that idea that he -- he always flattered Trump. You know, he was always saying things like, oh, it's Batman and Robin, and I'm Robin.

HILL: Yes.

KEEFE: And he knew how to kind of push Trump's buttons in that way. I don't think he would really come out and speak out against Trump. But it's interesting because I think -- I think, to my mind, without a doubt, this is the first line of Mark Burnett's obituary. I mean he's created some amazing TV shows, but he also basically help put a man in the White House.

BERMAN: All right, the question that Mark Burnett probably gets asked most at cocktail parties around the country is, are their tapes? Do these tapes exist? And the myth or the legend out there is that there are outtakes from "The Apprentice" where then, you know, businessman Donald Trump uses the "n" word or says other offensive things.

You've been looking into this as much as anyone else. Do you think these tapes exist?

KEEFE: So, we know that there is a huge archive of tapes, tens of thousands of hours of tapes, that now belong to MGM, which bought Mark Burnett's company. I came to concluded that probably there is not a tape in which Trump says the "n" word. There are a couple of people who say they've heard it. It's Omarosa and Tom Arnold. And I'll leave it to you to judge, you know, how seriously to take that.

[06:50:09] I couldn't find anybody else who'd actually said they'd heard this tape. And I did talk to a bunch of people, again, the editors, who didn't like Trump at all, who saw a huge amount of that footage and they said, look, if anybody -- if this tape existed, if anybody knew, I would know and somebody would have leaked it because there's so many people --

HILL: It would be out by now.

KEEFE: It would be out by now. There's all these people who would have had access to it and if -- these people told me, if Trump used the "n" word on a hot mike, that would have been passed around among the editors and it would have come out, it would have leaked, not because Mark Burnett and MGM said, oh, let us turn it over, but it would have leaked in the way that the "Access Hollywood" tape leaked, where somebody just leaks it to "The Washington Post."

HILL: It's fascinating. It really -- it's a great read.

KEEFE: Yes, thank you.

HILL: An absolutely fascinating read. Good to have you here.

BERMAN: Patrick Radden Keefe, thanks so much for being here.

Go check out the article in "The New Yorker," it's well worth your time, everybody.

HILL: Severe weather causing trouble in the skies. A major winter storm is heading -- heading -- where it's heading, next.

BERMAN: It's going somewhere.

HILL: It's going somewhere and we're going to tell you where.

(COMMERCIAL BREAK)

HILL: Severe turbulence caused by a major lightning storm, injuring at least two people on an American Eagle flight. That flight was diverted to Austin, Texas. The storm is part of a major system that is intensifying as it moves east.

[06:55:00] CNN meteorologist Jennifer Gray joins us now with your forecast.

That's some serious stuff, two people injured in that flight diverted.

JENNIFER GRAY, AMS METEOROLOGIST: Yes, very serious. You know, this is a storm we were talking about yesterday, it's got two sides. It has a snowy side to the north. It has severe weather to the south. And the severe weather has really been the spotlight of the storm up until now.

We have a tornado watch box in place that includes Houston, Texas, and that's until 11:00 Central Time. And look at the lightning. Just a monster line of storms that's pushing through the area this morning. And so that's going to continue to push east as we go through the next couple of days.

This is a slow mover. And so rain totals are going to be high, and snow totals are going to be high up to the north. And that snow component, we could see blizzard like conditions in all of these areas shaded in orange. And that's a huge section of the country. So do plan on more travel delays again today. We do have the winter storm warnings still in place for much of this area. Where we could see a foot to a foot and a half of snow for these areas shaded in purple, and then as this rain pushes to the east, will continue to soak the south and bring snow to the north, John.

BERMAN: All right, Jennifer, appreciate it. Thanks very much.

President Trump back at the White House this morning after his surprise visit to U.S. troops in Iraq. Now the big issue, can he get a deal to end this government shutdown? We have it all covered, next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: The United States cannot continue to be the policemen of the world.

UNIDENTIFIED MALE: He's going against the advice of our military. We're not going to come around to his way of thinking.

UNIDENTIFIED MALE: The president deserves credit for going -- when he does something right, we should say so.

UNIDENTIFIED MALE: When presidents visit war zones, you shouldn't get political.

[07:00:05] TRUMP: I don't know if you folks are aware of what's happening. The Democrats don't want to let us have strong borders.