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Apple's Revenue Sends Warning Signals; the DOW Plummeted Over 600 Points Midweek; Mike Pence's Warning to Democrats; Former Marine Arrested for Espionage in Russia; Jo Song Gil Missing in Italy; Thailand is Now Getting Ready for a Tropical Storm; American Charged With Espionage in Russia Has an Unlikely Background for a Spy; Mother And Daughter Await Asylum Hearing In U.S.; China: Two Canadians Detained "No Doubt" Broke Law; Trial Begins In Saudi Arabia For Jamal Khashoggi Killing. Aired 2-3a ET

Aired January 4, 2019 - 02:00   ET


[02:00:01] NATALIE ALLEN, CNN ANCHOR: Tech giant Apple's revenue warning triggers a sell-off and it's impacting markets around the globe. A new day in Washington, but it's the same old politics. Democrats take over the House or Representatives, passing a bill they know the President will veto. What is next?

Also this hour, the case against Paul Whelan, Russia formally charges the former U.S. marine with espionage. We'll have a live report from Moscow. It is all ahead here on another hour of CNN Newsroom. Thanks for staying with us. I am Natalie Allen. We'll get started right now. A sour forecast from Apple and concern about the U.S.-China trade war are poisoning financial markets from New York to Tokyo.

Japan's Nikkei took a hit, closing down two and a quarter percent. Stocks in Hong Kong and Shanghai are higher after word of a new round of U.S.-China trade talks. In New York, the DOW plunged 660 points on Thursday. Apple lost 10 percent of its value, its largest drop in 6 years. The tech giant warns Wednesday it will miss the quarterly sales forecast.

What does it mean? Let's go to journalist Kaori Enjoji who is live this hour in Tokyo. It's very good to see you. And it is unusual, isn't it, to see a drop in the first trading of a new year. But many investors are seeing their biggest fears occur right now. Japan's market closed an hour ago. How did it end?

KAORI ENJOJI, JOURNALIST: That's right, Natalie. Usually on the first day of trading like today, the market does go up. But this was the first time in three years that the Tokyo stock market traded sharply lower on the first day of trading. You're seeing losses of more than 2 percent, 2.2 percent on the Nikkei 225, closing below the 20,000 mark, 19,561 about an hour ago.

At one point, it was down over 700 points, playing catch up because the market was closed for the last four trading days for the New Year holidays. And I think this Apple concerns about their outlook and the overall concerns about the health of the Chinese economy, the U.S. economy. And on top of that, you're seeing a resurgence of the yen against the dollar, particularly on Thursday. And that all combined to trigger this big sell-off in the equity

market. This sell-off was so acute that government officials here, the financial regulator, and the central bankers got together in a special meeting this afternoon to try and discuss the situation and put some of the fears to rest. But this has been a build-up over the last couple of weeks.

They've held these emergency meetings for three weeks in a row now. And so I think the fears that were lingering at the end of the year all coming out into the open on the first day of trading. On top of that, we're seeing a knock-on effect on Japanese government yields as well. I think at a time of panic like this, people tend to flock to government bonds.

They did just that. With the yield on the Japanese government bond slipping below zero percent, you're seeing -- looking at negative interest rates on the benchmark tenure JGB (ph). So what started off as pretty much catch-up selling and accelerated throughout the day and a lot of the electronics companies, consumer electronic stocks got hit very heavily today.

I think also at a time like this, because Japan is such a liquid market and easy to trade, when you want to trade into China play, you tend to trade in to companies that have heavy exposure. And that tends to be some of the constructions here in Japan. So we're seeing very, very heavy selling on the first day of trading in 2019, Natalie.

ALLEN: Right. We'll talk more about it next hour, and look at the bigger picture for the whole world, and whether this could lead to a global recession. Thanks so much for your perspective, Kaori Enjoji for us there in Japan. We appreciate it. Well, it is a whole new world in U.S. politics. The stage is now set for an epic showdown between U.S. House Democrats and the Trump White House.

Just hours after Democrats retook control of House of Representatives, Vice President Mike Pence said if Congress did not fund the President's border wall there would be no deal to end the partial government shutdown, the standoff now two weeks old. With Nancy Pelosi elected Speaker of the House for a second time, the Democratic majority quickly passed legislation to reopen the government.

Neither bill provided any funding for a border wall. And for that reason, the Republican-controlled Senate is not expected to bring them to a vote. Pelosi said that is where the problem lies.


[02:05:05] REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE OF REPRESENTATIVES: This is not a wall between Mexico and the United States that the President is creating here. It is a wall between reality and his constituents, his supporters. He does not want them to know how he is hurting them. So he keeps the subject on the wall.

He's a master of diversion. We're trying to open up government with giving him a mature path to do so, not in our language but in the Senate. (END VIDEO CLIP)

ALLEN: It was Nancy Pelosi's day to celebrate, but the U.S. President still found a way to try to upstage her. Here's CNN's Kaitlan Collins at the White House.


KAITLAN COLLINS, CNN WHITE HOUSE CORRESPONDENT: The blame game for who owns the government shutdown continues to shift tonight. But President Trump now faulting the politics of the upcoming 2020 Presidential election, claiming Democrats are going all out on the desperately needed wall and border security so they could win. That despite White House officials telling reporters last night Nancy Pelosi wanted to keep government shutdown so she could win enough votes to become House Speaker, even though she ran unchallenged.

The President's aides now trying to place the blame squarely on Democrats, despite Trump saying this in front of the cameras in the Oval Office last month.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I will take the mantle. I will be the one to shut it down. I'm not going to blame you for it.

COLLINS: Late today, in yet another attempt to change the narrative, the President made a surprise appearance in the Briefing Room, surrounded by members of the union that represents border patrol agents, Trump once again saying a wall is needed, refusing to answer questions from reporters about the shutdown. Sources telling CNN Trump doesn't want to lose face with his base by caving on his signature campaign promise to build a wall. Though what that wall will look like is now an open question.

KELLYANNE CONWAY, COUNSELOR TO PRESIDENT TRUMP: If you listen to him yesterday, he clarified that. He said that you can call it whatever you want. In other words, we need border security. It may include a wall. It may include steel slats.

COLLINS: Democrats still enjoying their new found power are vowing not to give up any ground.

PELOSI: This has become a Trump shutdown through and through.

COLLINS: But before even being officially elected today, Pelosi throwing a punch, suggesting in an interview with NBC News that a sitting President can be indicted.

PELOSI: It's not the wall. Everything indicates that a President can be indicted after he's no longer President of the United States.

UNIDENTIFIED FEMALE: What about a sitting President?

PELOSI: Well, a sitting President when he's no longer President of the United States.

UNIDENTIFIED FEMALE: A President who is in office. Can Robert Mueller come back and say I'm seeking...

PELOSI: That is an open discussion. I think that is an open discussion in terms of the law.

COLLINS: That wasn't her only job, Pelosi also not denying telling members of her caucus that the wall is a quote, manhood issue for Trump.

PELOSI: I wish that members had not repeated that outside the room. But there's no justification for this wall. It is not the way to protect our border.

COLLINS: CNN has told the White House as formally invited Congressional leaders back for further talks Friday. But expectations for a quick fix remain low after talks went nowhere this week.

CONWAY: Nancy Pelosi can't ignore. Yesterday, they just ignored and interrupted him. Frankly, it was just very rude and dismissive of our Secretary of Homeland Security.

COLLINS: White House officials telling CNN they're strapping in for a lengthy shutdown, with one aide adding we could be here a while. Now, sources tell CNN that senior White House officials are not encouraging the President to accept those Democratic proposals and neither are his allies on Capitol Hill, including Senator Lindsey Graham who encouraged the President to wait for a better offer from Democrats. Kaitlan Collins, CNN, the White House.


ALLEN: CNN Political Commentator and Republican Strategist, Alice Stewart, joins me now. Alice thanks for being with us. We appreciate it.


ALLEN: Well, let's start with House Democrats. They voted on Thursday to reopen the government without a wall. So President Trump says he'll veto it. So where are we in this process of getting the government going again 100 percent?

STEWART: Well, we're virtually in the same place we were 12 days ago. We're at ground zero basically. No side appears to be trying to concede on any point. So this is really a battle of the bases here. We have President Trump and the die hard Republicans who are saying they want money for the wall and they want $5 billion.

And we have Democrats now that they have control of the House. They have a lot more leverage. And they're saying no, we're not giving you money for your big beautiful wall. We need to look at more overall border security. And Republicans are saying, you know, no wall money, no deal. And that's basically where we are right now.

[02:09:55] Ideally, both sides will recognize that there is some agreement on border security. And that could be some money for a wall, some money for protections for dreamers, some money for infrastructure or personnel on the wall. But right now it is just a matter of everyone is in their corner and not willing to come to the middle.

And ideally, that's what we need to move the ball down the field and open up the government in the end, which is what Americans really do want.

ALLEN: Let's listen to House Speaker Nancy Pelosi, voted in today in this powerfulness position as House Speaker. Let's hear what she said about President Trump's wall.


PELOSI: We're not doing the wall. Does anybody have any doubt that we're not doing a wall? So let's forget that.

UNIDENTIFIED MALE: Do you worry about backlash?

PELOSI: It is not politics. It has to do with a wall. It's a morality between countries. It's an old way of thinking.


ALLEN: And Vice President Mike Pence said no wall, no deal. Is this any part of semantics since we saw President Trump using other language besides wall? Now we're hearing more of security, a barrier, a fence. And do you think this softening of the wall will really turn into anything that the Republicans can agree to with the Democrats?

STEWART: I think the -- you're right on point of really the wall itself, semantics, whether we're going to call it a wall or steel slats or a curtain or some other type of device. The reality is Trump's wall is his wall. And Democrats recognize, no matter how -- whatever you call it, it is still the actual physical structure on the border.

It is something, as Nancy Pelosi just said. They view that as immoral. And they want to look at the bigger picture. And they don't think that walls work. They think that we certainly need to look at infrastructure and personnel and drones. But they also, as I said, they do have some bargaining power now that Republicans are no longer in control of the House and the Senate and the White House.

Democrats can negotiate certain aspects that they want. And protection for dreamers is something they can and should use. But at this stage of the game, when we have both sides in their corners and not willing to come to the middle, you can call it whatever you want. But right now we're calling it a shutdown. And with so sides willing to negotiate, it's -- nothing seems to be changing.

ALLEN: Right. And you mentioned that Democrats now have more power on the Hill as of today. And you were there for the swearing in of new legislators and when Ms. Pelosi was tapped as House Speaker. What was the atmosphere? Was it excitement meets a wall so to speak?

STEWART: It was -- it depends on which group you were with. I was on the House and Senate side. And certainly, I am a Republican. I voted for this President. I support his policies. But you cannot let the historic nature of what is going on this week escape you. We have a new face, literally and figuratively on the Congress, more women, more minorities.

We have more Hispanics. An entirely new makeup really of Congress that is certainly much more reflective of the American population. And that's historic, and it's something that you cannot go without notice. But politically, it was not a very happy day for Republicans, given that our power has been a greatly diminished in the House.

And it's going to much more difficult to get things done. And specifically, the President's signature issue really is immigration and border security, and specifically getting this wall built. And the fact they have not been able to get that done in the first two years is going to be certainly much more difficult moving forward.

ALLEN: Thank you so much. We appreciate your insights. Republican Strategist Alice Stewart, thanks, Alice.

STEWART: Thanks, Natalie.

ALLEN: Russia lays out part of the case against Paul Whelan. Ahead here, we'll go live to Moscow. The charges against the former American marine being held in a jail in Moscow, we'll talk about that. Also, North Korea's top diplomat in Italy hasn't been seen in weeks. Next, what we know about his disappearance and what it could imply. Stay with us. There's much more of CNN Newsroom.


ALLEN: A Russian news outlet reports the American held for spying in Moscow had classified information on him. Rosebalt reports that according to a source in Russia's special services, Paul Whelan had just accepted a flash drive with secret information when he was arrested last week. CNN has not verified this. The news site also reports that Whelan had been trying to recruit a Russian.

Moscow has not detailed the allegations. But Whelan's Russian lawyer says he was formally charged with espionage, and has been sitting in prison since his arrest. He says they are appealing and applying for bail. Let's bring in CNN's Moscow Bureau Chief, Nathan Hodge, Nathan, good to see you with us. Any more information on how and why he was arrested. What is it about this drive that he allegedly was found with? Do we know anything more about it?

NATHAN HODGE, CNN MOSCOW BUREAU CHIEF: Natalie, the Federal Security Service, Russia's domestic intelligence agency, announced Whelan's arrest at the beginning of this week, and has provided, you know, precious few details officially at least about the details of his arrest. And then the report, which you're referring to in Rosebalt, a Russian news outlet says that he was detained at the Metropole Hotel.

That's a historic hotel in downtown Moscow. And allegedly, according to this report, he was detained in possession what the Russians believed were the source for Rosebalt believing -- described as classified information. What the report went on to describe was what the Russian source said was -- were indications that Whelan had been conducting or trying to carry some form of espionage over the course of several years.

Now, Whelan's family has said that he has traveled several times to Russia. He's come as a tourist. He was here, his family says, to take part in a wedding. He has an account on VKontakte that's sort of a Russian equivalent of Facebook. And the source in this story said that this was one way that he was using to allegedly reach out to Russians to recruit them to get information on classified agencies and to get information about Russian intelligence operations, Natalie.

ALLEN: Right. And the question is, is this for real or is this something that Russia has in mind for some sort of prisoner swap with the United States? I don't know if you can talk about that. But I'm also wondering if anyone's heard from him. Do we know anything about the prison and the conditions that he's in there and how he's being treated?

HODGE: Well, Natalie, his lawyer tells us that he's being treated well and that his morale is good. He's being held at the Lefortovo Prison. That's a former KGB jail in a suburb of Moscow. And obviously, this is in part intense speculation in Washington about what the real agenda of the Kremlin is here, what the real agenda of Russian official is.

[02:20:02] Of course, about two weeks before the arrest of Paul Whelan, Maria Butina, the alleged Russian spy pleaded guilty in a federal court to conspiring to infiltrate Republican political circles in the United States. And so national security experts have been begun speculating about whether or not there may be some sort of a tit-for-tat in the works, and the Russians may be seeking to find some kind of a bargaining chip, someone to exchange for Butina or for possibly someone else.

There are other Russians who are in American custody, that the Russian has been very keen to see released. So at this stage, again, we have a lot of speculation and not a lot of official information, especially from the Russian side. The U.S., of course, has been trying to -- Ambassador Jon Huntsman, the U.S. Ambassador to Moscow has visited with Whelan.

And the State Department, of course, has expressed concern about wanting to get the full details of this case from the Russian side, Natalie.

ALLEN: That's a story we'll continue to watch. We appreciate it, Nathan Hodge for us in Moscow. Thanks, Nathan. Well, North Korea's top diplomat in Italy and his wife have apparently been missing for weeks. Raising suspicions they defected. Jo Song Gil's term was set to expire in November of last year, for more about it, here CNN's Brian Todd.


BRIAN TODD, CNN CORRESPONDENT: It's an Italian mystery with international implications. A top diplomat from North Korea vanishes from the streets of Rome into thin air, without clues, and seemingly without a search for months to find him. CNN has learned Jo Song Gil, the most powerful official at North Korea's embassy in Italy disappeared in November along with his wife.

A prominent South Korean newspaper reports that Jo has sought asylum in the west and that the Italian government protecting him. Italian officials tell CNN they're not aware of any asylum request.

GREG SCARLATOUI, COMMITTEE FOR HUMAN RIGHTS IN NORTH KOREA: I would say that the possibility that was indeed a defection is quite significant.

TODD: The U.S. State Department is not commenting. If Jo did defect, experts say, he would've been taking an enormous risk and not just with his own security.

UNIDENTIFIED MALE: To try to prevent North Korean diplomats from defecting, they will have to leave behind what's called an anchor, at least one or more of their children have to be left behind in North Korea as a hostage.

UNIDENTIFIED MALE: What do they do to those anchor children if a diplomat defects?

SCARLATOUI: We have surely had verified reports that family members left behind were punished harshly. They were sent to political prison camps. Some of them were executed.

TODD: The whereabouts of Jo Song Gil's children are unclear. Experts say as Kim Jong-Un's top diplomat in Italy, Jo would have shouldered huge responsibilities and pressures. He would have been North Korea's liaison to World Food Program in Rome, which supplies food to millions of starving of North Koreans. Kim could well have countered on Jo to deliver personal items to him and his cronies, side-stepping sanctions.

SCARLATOUI: Rome is a great place to be if you want to purchase Italian suits, if you want to purchase luxury Italian cars, Italian wine.

TODD: Thae Yong-Ho, a top North Korean diplomat in London who defected three years ago, told CNN Kim also depends on his embassies abroad to engage in black market trafficking of drugs, ivory, and other goods.

THAE YONG-HO, FORMER DEPUTY AMBASSADOR NORTH KOREA'S U.K. EMBASSY: They are engaged in that kind of illicit activities with the pretext of -- under the pretext of diplomatic privileges and immunities and they are not involved in those activities to raise funds for Kim Jong- Un's regime.

TODD: Analysts say for the young dictator now obsessed with portraying himself as a world statesman, this would be an inconvenient defection. UNIDENTIFIED MALE: He would likely downplay the significance of it,

but the discussion would never come up with other world leaders. But, you know, it would seem to be an embarrassment for the regime.

TODD: If this diplomat did defect, the key question now is how will Kim Jong-Un's regime respond? Analysts say it is likely that Kim will deploy his agents to track this man down, kidnap him, or kill him. To point out that even a city like Washington might not be the safest place for him to defect to. They say the D.C. area has at least 150,000 ethnic Koreans, and it's likely that there are North Koreans sleeper agents among them, people who might try to track this man down. Brian Todd, CNN, Washington.


ALLEN: Let's talk more about it with our Alexandra Field. She joins us now from Hong Kong, Alex, good to see you. Well, a former North Korean defector has reportedly said that the Ambassador may actually have information about Pyongyang's nuclear plans are true, he would be of huge value to the U.S. But as we heard from Brian Todd's piece, no one is quite sure where he is.

ALEXANDRA FIELD, CNN CORRESPONDENT: Right. No one is quite sure where he is. If officials do know where he is, he -- they are not saying. Certainly, you heard the line from the Italian Foreign Ministry that they have not received a request for asylum from a North Korean diplomat. Similarly in South Korea, the National Intelligence Service, which briefed lawmakers on the disappearance of this diplomat, has not been able to say whether or not this is somebody who might have defected.

[02:25:17] And there has been no comment from South Korea's Blue House, the equivalent of the White House. So for now, there is a lot of speculation about where he is. And there will also continue to be speculation about what he knows. You tossed out the idea that he could know something about nuclear plans. Well, we know this is a diplomat who's been out of the country since 2015.

He's been posting in the embassy in Italy. He ascended to the top job after the former Ambassador to Italy was expelled as retaliation for North Korea's ramped up ballistic missile tests and their nuclear tests. So it's really not clear what he would know intimately about North Korea's nuclear plans. But certainly, he could be a source of information for officials about that kind of black market trade activity, allegedly moving through North Korea's embassies that Brian alluded to in the piece you just watched, Natalie.

ALLEN: Right. And, yeah, we're also learning how difficult it would be for someone from North Korea serving overseas to try and defect. What can you tell us about that?

FIELD: Yeah. Certainly, it would be a lot of more difficult to escape from North Korea itself, to defect that way. For a diplomat who is overseas, you've got to think that it is considerably easier. You've got access to a lot more people. You've got international relations to some extent as a diplomat for North Korea. But certainly, there is security measures involved at these embassies.

We know that there are various roles that are put in place, like diplomats going out in pairs in order to effectively watch each other. That's been sort of anecdotally relate from various North Korean embassies around the world. We really don't have a clear picture of what the security measures are that govern diplomats and embassy staff for North Korea's places overseas.

You have to imagine that those regulations became more strict after the last high profile diplomatic defection back in 2016. But Natalie, we know very well from defectors from North Korea that the penalty is most often paid by the families back at home. That certainly would instill a lot of fear in those serving overseas. It is again not clear if Jo was traveling with any of his children.

ALLEN: It is a fascinating story. We'll continue to follow it, of course. Still to come -- thank you, Alex. Democrats retake control of the U.S. House and signal how they intend to target President Trump in the coming session. We'll have that. Plus, it hasn't happened in decades. But Thailand is now braced for a tropical storm, and some are now stranded, and it is too late to get out.


[02:30:09] NATALIE ALLEN, CNN INTERNATIONAL ANCHOR: Welcome back. You're watching CNN NEWSROOM. Let's update you on our top news this hour. Stocks in Asia mixed after another (INAUDIBLE) on Wall Street. Tokyo's Nikkei closed down two and a quarter percent. Hong Kong and Shanghai are higher after a word of new round of U.S.-China trade talks. In New York, the Dow sank 660 points Thursday after a warning from Apple that it won't meet sales targets.

A Russian news site reports that the American detained for spying in Moscow was caught with a flash drive containing classified information. CNN has not verified these allegations against ex-marine Paul Whelan. His Russian lawyer says he has appealed Whelan's detention and applied for bail. North Korea's top diplomat in Italy hasn't been seen in weeks. That information from the South Korean lawyer -- excuse me, lawmaker is raising suspicions that Jo Song-gil he may have defected.

Jo's wife also disappeared in early November. Italian authorities say they're not aware of an asylum request. Thousands of people are now stranded on Thailand's popular tourist islands. Bangkok Airways has suspended all flights and a ferry service has shutdown ahead of what could be the worst storm to hit the country in decades. For days, residents were being evacuated to the mainland. But now, the islands are feeling the effect of a tropical storm while wind and storm surge will be dangerous, the biggest concern is flooding and mudslides.

Meteorologist Derek Van Dam joins us with more about it. Interesting. They were evacuating people (INAUDIBLE) they just ran out of time.

DEREK VAN DAM, CNN INTERNATIONAL METEOROLOGIST: Well, the storm is upon them now, so if they didn't get off those remote islands then it's going to be difficult to get on to the mainland of Thailand certainly. Now, this area by many people's standards is a very much paradise, you know, there are so many popular tourist islands, Ko Samui, Ko Tao, Ko Pha-ngan, the Phi Phi Islands, into Phuket, lots of tourists flock to this part of the world.

Well, they're going to be in the thick of it for the next 12 to 18 hours as this tropical storm bears down on the region. Here's the center of circulation. The strongest part of the storm just now starting to make landfall in the extreme southern sections of Thailand. Now, Ko Samui and some of those popular islands I just mentioned just a little bit to the north. So the strongest of winds and the heaviest of rains just outside the reaches of those most popular tourist destinations.

But nonetheless, still about 15 million people feeling the impacts of this Tropical Storm Pabuk. Now, here are the impacts that we're expecting, heavy rain, flooding. There are mountains across this area, so the potential for mudslides exist. Believe it or not this was the last storm, tropical storm to form in 2018. It carried over to New Year into 2019. It's now in the Gulf of Thailand about to make landfall on the east coast of Southern Thailand. So this has been a long stretch storm for several days.

In fact, the impact in parts of the Philippines late last week as well, 95 kilometer per hour sustained winds with the system according to the Joint Typhoon Warning Center. And it is closed schools along the east coast of this country in preparedness for this -- the arrival of this storm. Now, the reason why I'm so concerned about this particular tropical storm is because this area is not prone to tropical systems. In fact, the last typhoon to impact the country, 1989.

The last tropical storm, Harriet, 1962, unfortunately, caused over 900 fatalities for this country. It was a devastating storm for this part of the world and when it -- you go these in many decades between seeing this powerful storms impact the country, you can imagine that they do not have the infrastructure to prepare to for storms of this magnitude unfortunately. Now, in terms of population, we do have the highest population density near Bangkok.

They're basically in the clear from the center of the storm. But along the east coast facing the shoreline of Thailand -- Southern Thailand specifically with the onslaught of the storm system, we will have about 15 million people in the path of this particular system as it curves to a northwesterly direction after it enters the Andaman Sea. Now, rainfall totals have been impressive so far, nearly 200 millimeters. Natalie, we have the Phuket mountain range that runs north and south along the Malay Peninsula here and that's going to ring out all the available the moisture and produce another 200 millimeters on top of what's already fallen.

Some mudslides, landslides, and flash flooding will be the main concern going forward for this part of the world, Natalie.

ALLEN: Yes. You got to go to for the people that didn't get to evacuate and then trapped where they are. We know you'll be follow it up for us and we'll definitely hear more about it. Derek, thanks. DAM: You're welcome.

[02:35:00] ALLEN: Other news now, the partial shutdown of the U.S. government is now two weeks old with no end in sight. President Trump's dispute with Democrats over border security and wall funding took center stage Thursday when he made a surprise appearance in the White House briefing room along with U.S. border patrol officials. He used the event to make another push for his border wall agenda. He also congratulated Nancy Pelosi as the newly elected Democrat Speaker of the House. Leadership from both parties in Congress will meet with the president in the coming hours, but it is clear Pelosi isn't open to funding the wall in order to end the shutdown.


REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE OF REPRESENTATIVES: We're not doing a wall. Does anybody have any doubt that we are not doing a wall? So that's it.



PELOSI: No (INAUDIBLE) politics. It has to do with the wall as a morality between countries. It's an old way of thinking.


ALLEN: It remains to be seen whether progress toward ending the shutdown will occur soon as both sides appear to be dug in.


MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES: The president has made it clear. We're here to make a deal. But it's a deal that's going to result in achieving real gains on border security and you have no border security without a wall. We will have no deal without a wall.


ALLEN: On another issue, the newly sworn in Congress ends Republican majority rule and leaves the door open for House Democrats to take a closer look at President Trump. For more about it, here's Randi Kaye.


RANDI KAYE, CNN INTERNATIONAL CORRESPONDENT: House Democrats now armed with subpoena power are gunning for answers. A big one the House Intelligence Committee is looking to explore whether a foreign power Russia has sway over Trump. The committee will examine if there's asny evidence the Trump Organization ever laundered money since the family has business with Deutsche Bank which has faced massive fines over Russian money laundering scheme.

REP. ADAM SCHIFF (D-CA), CHAIR OF THE HOUSE INTELLIGENCE COMMITTEE: The question is, were the Russians laundering money through the Trump Organization? And that will be a very high priority that to get an answer to.

KAYE: Democrats on the House Intelligence Committee also plan to zero in on Don Jr.'s 2016 Trump Tower meeting with a Russian lawyer promising dirt on Hillary Clinton. At issue, a phone call to a block number that Democrats believed could belong to President Trump who has long insisted he was unaware of the meeting.

SCHIFF: We know the president used a block number during the campaign, so we asked for a subpoena of the phone records.

KAYE: The Judiciary Committee now chaired by Democratic Congressman Jerry Nadler plans first and foremost to protect Robert Mueller's Russia investigation. Nadler would like to question Acting Attorney General Matt Whitaker.

REP. JERRY NADLER (D-NY), CHAIR OF THE HOUSE JUDICIARY COMMITTEE: The questions we will ask him will be about his expressed hostility to the investigation how he can possibly supervise it when he has come out and said that the investigation is invalid.

KAYE: Nadler's committee also plans to take the lead on Trump's immigration policy focusing on the forced family separation and the deaths of immigrant children in U.S. custody.


KAYE: Chairman Richard Neal of the House Ways and Means Committee has one key target, the president's tax returns. Under IRS rules, Congressman Neal is one of only three people on Capitol Hill who can ask the Treasury Department for the president's tax returns and he's the only Democrat.


REP. RICHARD NEAL (D-MA), CHAIR OF THE HOUSE WAYS AND MEANS COMMITTEE: I think that the president has an opportunity here to diffuse this and just release the forms as every other candidate and president has done.

KAYE: And finally, the Committee on Oversight and Government Reform has the broadest jurisdiction to investigate the president. Its top Democrat Elijah Cummings is eager to investigate everything from White House security clearances to private aircraft travel by cabinet officials. He also plans to look into who is benefiting from foreign leaders staying at Trump's hotels.

REP. ELIJAH CUMMINGS (D-MD), CHAIR OF THE HOUSE OVERSIGHT COMMITTEE: We want to look and see exactly what's happening, how much money is actually going to his pocket, and whether, and try to make a determination whether he's making decisions in the interests of the American people or his own bottom line.

KAYE: Cummings says it's time to cut through the B.S. and get to the facts. President Donald Trump now officially on notice. Randi Kaye, CNN New York.


ALLEN: The 116th Congress is the most diverse in U.S. history. Muslim and Native American women are serving for the first time ever and a record 127 women are now members of Congress. Representative Ilhan Omar wearing white there has the distinction of becoming the first Somali-American member of Congress. And get this. She came to the U.S. more than two decades ago as a refugee.


REP. ILHAN OMAR (D), MINNESOTA: As we exited our planes, we realized that (INAUDIBLE) I had not return on that same airport since the day we first landed here as refugees.

[02:40:09] And so, you know, it is -- it's a very really overwhelming and emotional time for us. And I don't think, you know, as my dad said, you know, he had high hopes for us of the opportunities (INAUDIBLE) we came to this country. But I don't think he imagined that someday his baby would be going to Congress 20 years after we arrived here.


ALLEN: Well, she is there. A milestone also for Hispanic and Latino members with 10 newly elected as well as from African-Americans adding nine new members and the number of LGBTQ Congress members is at a historic high. Coming next, her anguished cries pulled at the heartstrings of people around the world. Now, a young migrant girl from El Salvador is one step closer to starting a new life in the U.S. And as the trial for Jamal Khashoggi's murder begins, Turkey isn't happy about where it's being held.

We'll have more on that. Plus, Pope Francis says the Catholic Church's credibility has taken a hit after multiple sex abuse cases. Ahead what he told U.S. bishops in a scathing letter.


ALLEN: It's hard to forget the haunting cries of children separated from their families at the U.S. border last summer.


UNIDENTIFIED MALE: Where are you from?



UNIDENTIFIED FEMALE: I want to go with my aunt.

UNIDENTIFIED MALE: You're going to get there. Look, she will explain it and help you.

UNIDENTIFIED FEMALE: At least can I go with my aunt? I want her to come. I want my aunt to come so she can take me to her house.


ALLEN: That was a little girl name Alison. There she is. A migrant from El Salvador held at a detention center in Arizona. She was begging for someone to call her aunt so she could reunite with her mother who had no idea where she was. Her mom was at a detention center 2,000 kilometers away in Arizona. Thankfully, they were finally reunited in Houston shortly after their story went viral. A lot has happened since. CNN's Gary Tuchman has that.


[02:45:03] GARY TUCHMAN, CNN INTERNATIONAL CORRESPONDENT: Seven-year- old Alison Gemina Madrid enjoying the day at the Children's Museum of Houston.

Are you happy today?


TUCHMAN: A very different story from when she and her mother first came to this country. And now, almost six months later, they're getting ready for their first asylum hearing. The start of a process which will determine whether or not they can stay in the U.S.

As they've waited for the hearing, Alison Ximena has been going to a public school in Houston. When she arrived in the U.S., she did not speak a word of English.

So, Alison Ximena, you have something you want to read?


TUCHMAN: OK, let's hear in English.

MADRID: Why I love America? I love my school, I love my church, I love to smile, I love and live in the America dream. Happy New Year America.

TUCHMAN: Happy New Year America to you, too.

MADRID: Happy New Year, America.

TUCHMAN: Her mother, Cindy, is doing her best to learn English at her church.

CINDY MADRID: One, two, three, four, five, six.

TUCHMAN: She cannot legally get a job at the stage of the asylum process. But says she wants to work. She says, "She would like to have a job in cleaning, or at the restaurant. Or whatever job she can get, as long as she can do it with dignity.

A. MADRID: Rex and Blair work together, they mix, they mix, the crab, apples, sugar, salts, and water. TUCHMAN: So, what is the likelihood that daughter and mother will be granted asylum? Their lawyer says she is hopeful. But --

THELMA GARCIA, ATTORNEY TO CINDY AND ALISON MADRID: There's a good chance that it may not be granted.

TUCHMAN: Attorney Garcia, says Cindy Madrid left to protect Alison, her only child from gang violence. Alison told us what her understanding is of that threat.

"The gang," she says, "they wanted to steal me." The attorney says if Cindy Madrid loses her case and is sent back to El Salvador, that is not an overstatement.

GARCIA: Could be death. They had very serious problems with the gang violence. They had no protection by the police, as well. So, we're not expecting anything good if she is returned back home.

TUCHMAN: Alison Ximena says Houston is now her home.

A. MADRID: It is a sunny day when friends stick together.

TUCHMAN: El fin. The end.

A. MADRID: They're finished. OK.

TUCHMAN: But this legal battle is far from finished. Gary Tuchman, CNN, Houston.


ALLEN: What an adorable child, and a quick learner too.

The Canada's Global Affairs Department, says 13 Canadians have been detained in China since December first, but at least, aided them have since been released. The detentions coincide with when Canadian officials arrested, Chinese Huawei executive Meng Wanzhou on behalf of the U.S.

It's not clear why many of the 13 Canadians were held. Beijing's vice minister of justice didn't confirm the arrests directly. But said, China operates under the rule of law. Experts suggest two of the arrests could be Chinese retaliation for Meng's arrest.

Beijing has accused Michael Kovrig, a former Canadian diplomat, and Michael Spavor, a businessman of threatening China security. And the prosecutor says, there's "no doubt" they broke the law. Canada disagrees and is demanding their immediate release.

The trial against eleven man accused of murdering journalist Jamal Khashoggi is underway in the Saudi capital. Prosecutors are pushing for the death penalty for some of the suspects. But Turkey says it should be conducting the murder trial because that is where Khashoggi was killed. For more, here's CNN's Gul Tuysuz.

GUL TUYSUZ, CNN SENIOR NATIONAL PRODUCER: Three months ago, Jamal Khashoggi walked into the Saudi consulate building behind me. And today was the first hearing in his murder case in Saudi Arabia.

We don't know a lot about how that process is going to be unfolding. But what we do know today we have from the Saudi prosecutor's office saying that there are 11 suspects who are being tried in this case. And they are going to be asking for the death penalty for five of those suspects. We don't know the names of them, but the Saudi prosecutor's office says, that those five are ones who had direct involvement in the murder itself.

The other thing that we know at this point is that as the trial was unfolding, the suspects asked for copies of the indictment and asked for more time to prepare. A wish that was granted by the court. The Saudi Prosecutor's Office also issued a statement, saying that they had been asking, sending letters to their Turkish counterparts, asking for any evidence that Turkey had in relation to the murder.

And they said that their requests have not been answered thus far. We know that there was been a lot of diplomatic back-and-forth between Turkey and Saudi Arabia when it comes to the murder of Saudi journalist Jamal Khashoggi.

Turkey saying that Saudi Arabia as opposed to collaborating is trying to figure out what evidence Turkey has and they're really asking that the case against those suspects involved in the murder of Jamal Khashoggi be tried here in Turkey. That issue has not been resolved.

But what does remain now is that for the loved ones of Jamal Khashoggi, there isn't a lot of peace. Because the whereabouts of his body still remain a mystery. Gul Tuysuz, CNN, Istanbul.

[02:51:00] ALLEN: Pope Francis says a culture of abuse has damaged the credibility of the Catholic Church. In a letter to U.S. bishops, he called for a renewed approach to solving the widespread problem. More now from Barbie Nadeau in Rome.

BARBIE LATZA NADEAU, CNN CONTRIBUTOR: Pope Francis did not mince words in a letter to U.S. Catholic Bishops who are meeting at a spiritual retreat outside of Chicago this week.

In the letter, he called for them to be discerning and for conversion. The United States is not the only country that has been subject to widespread clerical sex abuse in recent years, but it is by far one of the most problematic.

Over the summer, the Pennsylvania grand jury issued a damning report that outlined decades of clerical sex abuse by hundreds of priests against thousands of children. Several other states in America have followed suit with their own investigations.

In his letter to the U.S. bishops, he writes, "In recent years, the church in the United States has been shaken by various scandals that have gravely affected its credibility. These have been times of turbulence in the lives of all those victims who suffered in their flesh the abuse of power, and conscience, and sexual abuse on the part of ordained ministers, male and female religious, and lay faithful. But times of turbulence and suffering also call for the families and for the entire people of God."

Pope Francis has called leaders of the church to meet in February in Rome to discuss the global clerical sex abuse crisis. Hopefully, they'll be able to find solutions that will pacify the victims and will allow the faithful to continue to have faith in their church. Barbie Latza Nadeau, for CNN, Rome.

ALLEN: The president of Greece welcomed three heroic fishermen to the presidential palace on Wednesday. The men helped fire victims during the wildfires last July at this resort town near Athens. They saved dozens of people by helping them into the sea to escape the flames.

Some of the fishermen were migrants. Two Egyptians and an Albanian man were granted Greek citizenship and recognition of their heroic action.

Still ahead, a powerful Blizzard in Poland wasn't enough to stop the meteorologists from carrying out their duties. Now the group dug out of a snowdrift to report the weather.

Plus, ice castles and snow sculptures all on display at the largest ice festival in the world. We'll explore this winter wonderland just ahead.


[02:55:00] ALLEN: Heavy snowfall couldn't prevent three determined meteorologists from carrying out their scientific duties. The group got stuck inside a snowed in meteorological station in Poland on Thursday, but they would not be deterred.

The three managed to dig to the snow and up to the surface in order to measure the weather readings outside. They did so, despite an avalanche alert, and strong winds from the blizzard. Maybe they'll get a little raised for working so hard.

A hundreds of thousands are traveling to China for a cold weather spectacular. The Harbin International Ice and Snow Sculpture Festival kicks off this weekend. CNN's Michael Holmes takes us through the dazzling display.


MICHAEL HOLMES, CNN INTERNATIONAL CORRESPONDENT: Welcome to ice and snow world. It's an annual festival of ice sculptures and colorful lights in China's northeastern city of Harbin, or Ice City as the locals call it. On display, there are cathedrals and palaces more than 10 meters high alongside smaller more delicate exhibits.

Its hard work for the sculptors but the reward of having a guaranteed audience to admire their creations makes it all worthwhile.

GUAN HONGLIANG, SCULPTOR AT HARBIN INTERNATIONAL ICE AND SNOW SCULPTURE FESTIVAL (through translator): Unlike other sculptures, which are always placed somewhere after being finished, and we do not know who will see them. We know that the ice and snow sculptures here will definitely be seen by lots of tourists.

HOLMES: The Ice Festival attracts more than a million Chinese and international visitors to Harbin every year. And not even the sub- zero temperature manages to dampen the party atmosphere.

UNIDENTIFIED MALE: We made sure to wear lots of clothes to keep warm. But I think we could use some more. But I think it's definitely worth it because I don't think there are many places in the world where you can see the things that we can see here.

HOLMES: The festival will remain open until February when temperatures start to warm up. Michael Holmes, CNN.


ALLEN: Stunning. You're watching CNN NEWSROOM. We appreciate it. I'm Natalie Allen, I'll be right back with another hour. Our top stories just around the corner.


ALLEN: Bad news at Apple, leads to another rough day on Wall Street and triggers more fear about a possible global slowdown.

Also a new political landscape in Washington. Democrats take over the House of Representatives with new challenges for the president.