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EARLY START

Gunman Kills Three, Wounds at least 11 in California; Coats To Step Down As Director Of National Intelligence; Trump Versus Congress; CNN Business; Woman Next In Line To Puerto Rico Gov. Declines; Beijing Finally Addressing Hong Kong Crisis; $3 Million Fortnite Champ; The Economic State Of the 2020 Candidates; Retailers Open Store That Don't Sell Anything; Disney Sets New Industry Record. Aired 4:30-5a ET

Aired July 29, 2019 - 04:30   ET

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


[04:30:00] (COMMERCIAL BREAK)

CHRISTINE ROMANS, CNN HOST: Welcome back to "Early Start." I'm Christine Romans.

DAVE BRIGGS, CNN HOST: I'm Dave Briggs on a breaking news Monday, 31 minutes past the hour. We start in Gilroy, California, where a family food festival in farm country turned into a deadly scene of terror.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: What's going on? What's going on?

UNIDENTIFIED FEMALE: Is that fire?

UNIDENTIFIED FEMALE: What the (BEEP)'s going on?

UNIDENTIFIED FEMALE: Oh, shooting.

(END VIDEO CLIP)

BRIGGS: A gunman firing round after round at the annual Garlic Festival in Gilroy which is 80 miles south of San Francisco. Gilroy police say three people were killed in addition to the gunman and at least 11 were injured. Chief Scott Smithee telling reporters overnight that officers confronted the shooter almost immediately.

(BEGIN VIDEO CLIP)

SCOT SMITHEE, GILROY POLICE CHIEF: Officers were in that area and engaged the suspect in less than a minute. The suspect was shot and killed. We had many, many officers in the park at the time that this occurred, as we do any day during festival, which accounts for the very, very quick response time.

(END VIDEO CLIP)

BRIGGS: Smithee says witnesses reported a second attacker, but he said it's unclear what role that person might have played. CNN's Paul Vercammen is monitoring the latest from Los Angeles, he joins us live. Paul, good morning, what are you learning? PAUL VERCAMMEN, CNN CORRESPONDENT: Well, good morning, Dave. One

thing we are learning and the police chief articulated this, a level of premeditation and calculation. Now was this a lone gunman. The police chief repeatedly saying they. They went into a creek bed, walked along the creek and then cut through a fence in order to evade security at the park. And then he raised the issue of the possibility of an accomplice. Let's listen.

(BEGIN VIDEO CLIP)

SMITHEE: We believe based on witness statements that there was a second individual involved in some way, we just don't know in what way.

(END VIDEO CLIP)

VERCAMMEN: So they're calling this an active investigation. The peace and quiet of this Gilroy Festival just shattered. Gilroy calls itself the garlic capitol of the world. Routinely some 80 to 100,000 people will attend this event over a weekend. And we now understand that one of the victims, a 6-year-old boy. Back to you now, Dave.

BRIGGS: Heartbreaking. Paul Vercammen live for us in L.A. this morning. Thank you.

ROMANS: You know, thousands were still enjoying the Gilroy Garlic Festival as it begin to wrapped up Sunday evening when those shots rang out triggering panic, confusion and a desperate run for cover. The first man you'll hear was a stage hand for the final musical act of the day.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Bullets were hitting the ground. You could see them going up. That is when I called out, it's a real gun. And so the crew and the band ran and hid underneath the stage. So we were hiding underneath the stage. We could hear more gunfire happening. Eventually some gunfire happened and bullets were hitting the stage that we were hiding underneath and then eventually it stopped. There was people just calling out looking for hurt people.

[04:35:04] Eventually we came out and I could see that there was someone down and they were performing CPR on them. And later I heard it was the gunman.

UNIDENTIFIED MALE: People were looking for their kids, too, and as soon as the gunfire started, everybody scattered and people were yelling for their kids. And, yes, you just heard the --

UNIDENTIFIED FEMALE: So you heard rapid fire?

UNIDENTIFIED MALE: It was like a semi-automatic going off really close, too. People screaming and hiding and ducking.

UNIDENTIFIED MALE: And then I was in a phone booth, two shots rang out first, and at the same time the music started for the concert, so I thought it was like an opening act for the concert, but after a few seconds, there was so many shots, tat, tat, tat. And I saw people falling down, kids falling down, I have to jumble with three of the kids. One bullet passed me very closely and it hit our friend's booth, a chair and the shrapnel went into her leg also, so she is injured there.

(END VIDEO CLIP)

ROMANS: That is awful. Gilroy police still looking for that second possible suspect. They are asking witnesses or anyone who took pictures or recorded a video of the attack to call a tip line. They have set-up that number there on your screen.

BRIGGS: To politics now. A national intelligence Director Dan Coats is stepping down next month. President Trump making the announcement on Twitter Sunday. He plans to nominate Texas Republican Congressman John Ratcliffe to replace Coats. Ratcliffe aggressively questioned former Special Counsel Robert Mueller last week in defense of the president.

(BEGIN VIDEO CLIP)

REP. JOHN RATCLIFFE (R-TX): I agree with the chairman this morning when he said Donald Trump is not above the law. He is not, but he damn sure shouldn't be below the law which is where volume two of this report puts him.

(END VIDEO CLIP)

BRIGGS: The president thank, Dan Coats for his great service to the country, but truth be told, the two were not always on the same page. Coats strongly defended U.S. Intelligence agencies in their assessment that Russia interfered in the 2016 election. And during an interview at a security conference last year, he was famously caught off guard by news of a Trump/Putin meeting.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I do want to say we have some breaking news. The White House has announced on Twitter that Vladimir Putin is coming to the White House in the fall.

UNIDENTIFIED MALE: Say that again.

UNIDENTIFIED FEMALE: You -- Vladimir Putin --

UNIDENTIFIED MALE: I heard you.

UNIDENTIFIED FEMALE: Yes. Yes.

UNIDENTIFIED MALE: OK.

UNIDENTIFIED FEMALE: Yes. That is going to be special.

(END VIDEO CLIP)

BRIGGS: Special reaction there. Coats' resignation effective August 15th.

ROMANS: All right. President Trump escalating his Twitter campaign against a leading African-American Congressman over the weekend. On Saturday Trump attacked Maryland Democrat Elijah Cummings calling his majority black district a disgusting rat and rodent infested mess. That draw accusations of racism. On Sunday, trump responded by calling Cummings a racist and accusing him of doing quote a terrible job for the people of his district. More now from CNN's Boris Sanchez at the White House.

(BEGIN VIDEOTAPE)

BORIS SANCHEZ, CNN CORRESPONDENT: Dave and Christine, President Trump on Sunday doubling down on his attacks on Congressman Elijah Cummings and his district following up on tweets that he had previously sent on Saturday bashing the Congressman suggesting that he should pay more attention to conditions in his district than those of migrant detention facilities along the Southern Border. And in one tweet on Sunday, the president calling Cummings a racist.

Now the White House is trying to spin the president's attacks and sort of polished them. Acting Chief of Staff, Mick Mulvaney was on one of the Sunday morning talk shows, suggesting that the president often does offend people with this language, but that these attacks were not based on race. Mulvaney making the case that the president was trying to fact check Cummings on his descriptions of conditions at these border facilities. Listen to more from Mulvaney.

(BEGIN VIDEO CLIP)

MICK MULVANEY, WHITE HOUSE CHIEF OF STAFF: The president is attacking Mr. Cummings for saying things that are not true about the border. I think it is right for the president to raise the issue. Look, I was in Congress for six years. If I had poverty in my district like they have in Baltimore, if I had crime in my district like they have in Chicago, if I have (inaudible) in my district like they have in San Francisco and I spent all of my time in Washington, D.C., chasing down this Mueller investigation, as bizarre impeachment crusade, I'd get fired. And I think that the president is right to raise that and has absolutely zero to do with race.

(END VIDEO CLIP)

SANCHEZ: Two important points here, Dave and Christine. First, related to Congressman Cummings description of these border facilities, they line up with what we've heard from numerous outlets, from CNN's own reporting that conditions at these facilities are horrendous. Secondly, if you look at the president's tweets, he doesn't actually fact check Cummings or dispute his descriptions. Mick Mulvaney with a bit of spin there. We should point out that the president's tweets overall were inaccurate. The district that Congressman Cummings represents happens to be one of the most educated, and most affluent, predominantly African-American districts in the country. Dave and Christine.

(END VIDEO CLIP) BRIGGS: Boris Sanchez there, thank you.

[04:40:00] Meantime the "Baltimore Sun" did not take kindly to President Trump attacking their city as a rodent infested mess. The paper hitting back in a scathing Sunday editorial saying quote, better to have some vermin living in your neighborhood than to be one.

ROMANS: Wow. All right. As 2020 approaches, President Trump has advantage of a strong economy. He has often bragged this is the best economy in history. The Democrats running to take his job, they have to prove otherwise.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: It's the economy, stupid. A strong economy is a gift for any sitting president going into an election year.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We have the hottest economy anywhere on earth. We have the number one economy in the world. We're now the economic envy of the entire world.

UNIDENTIFIED FEMALE: It's an advantage for President Trump. The lowest jobless rate in half a century. Nearly 3 percent economic growth last year. The stock market near record highs, but the Democratic candidates for president are asking, just who is the Trump economy working for?

SEN. KAMALA HARRIS (D-CA), U.S. DEMOCRATIC PRESIDENTIAL CANDIDATE: He has done nothing to help working families in America.

MAYOR PETE BUTTIGIEG (D-SOUTH BEND-IN) 2020 PRESIDENTIAL CANDIDATE: Communities were as if this recovery never even happened.

JOE BIDEN, FORMER VICE PRESIDENT OF THE UNITED STATES, 2020 U.S. PRESIDENTIAL CANDIDATE: Ask this people who work in this restaurants how that economy came up for them.

UNIDENTIFIED FEMALE: They key for Democrats in 2020, frame the Trump economy as great for big corporations and the wealthiest Americans.

HARRIS: I will repeal the tax bill that benefits the top 1 percent.

BIDEN: Eliminating Donald Trump's tax cuts for the wealthy.

SEN. BERNIE SANDERS, (I-VT), U.S. PRESIDENTIAL CANDIDATE: It is Wall Street's turn to help rebuild the American middle class.

UNIDENTIFIED FEMALE: Senators Bernie Sanders and Elizabeth Warren want more taxes on the ultra rich.

SEN. ELIZABETH WARREN (D-MA), 2020 U.S. DEMOCRATIC CANDIDATE: An ultra-millionaire's tax. It's 2 cents on every dollar of the great fortunes above $50 million.

UNIDENTIFIED FEMALE: Crackdown on Wall Street.

SANDERS: We are going to break those huge banks up.

UNIDENTIFIED FEMALE: And reign in big tech.

WARREN: It is time to break up America's tech giants.

UNIDENTIFIED FEMALE: Most of the Democratic candidates want to raise corporate taxes, tax investment profit, some even favor putting a fee on every Wall Street trade.

HARRIS: Frankly, this economy is not working for working people.

UNIDENTIFIED FEMALE: Democrats' message, that in the Trump economy, income inequality is worsening. Today the top 1 percent are more wealth that the bottom 90 percent combined. Democrats propose raising the minimum wage, strengthening worker's rights, and implementing fairer housing policies. Senator Cory Booker wants to give newborns a bond to close a racial wealth gap. The median white family in America had nearly 10 times the wealth of the medium black family.

SEN. CORY BOOKER (D-NJ), 2020 U.S. DEMOCRATIC CANDIDATE: It's time we target the creation issue of wealth equally for all children in America.

UNIDENTIFIED FEMALE: Senator Kamala Harris wants to bring transparency to the gender pay gap.

HARRIS: Paying people for equal work equally.

UNIDENTIFIED FEMALE: While Biden, Warren and Sanders have plans to revitalize rural America.

BIDEN: Rural economies which are integral to the nation's success.

UNIDENTIFIED FEMALE: And then there's free college, first popularized by Bernie Sanders in 2016. Critical that many Americans go into debt to earn a degree.

SANDERS: Frankly, that is crazy. We want you to get the best education you can without having to pay off outrageous levels of debt.

UNIDENTIFIED FEMALE: This time around all the candidates have some policy for affordable college. Most want free community college, though free collage for all, and canceling all debt, that is a far left position not match by everyone.

REP. BETO O'ROURKE (D-TX), 2020 PRESIDENTIAL CANDIDATE: No, I'm not for free college for all.

BUTTIGIEG: I just don't believe it makes sense to ask working class families to subsidize even the children of billionaires.

UNIDENTIFIED FEMALE: Warren has proposed wiping out student loan debt up to $50,000 for some 42 million student debtors.

WARREN: Anyone in this country should be able to get an education without getting crushed by student debt. UNIDENTIFIED FEMALE: Bottom line, the Democrats say, Trump's economy

isn't helping all-Americans. The question is can they convince voters the same.

(END VIDEO CLIP)

BRIGGS: All right. Good stuff. You'll hear much more during the Democratic presidential debates. Two big nights, 10 candidates each night. Tomorrow night and Wednesday night 8 Eastern, live from Detroit right here on CNN.

ROMANS: All right. After eight weeks of furious demonstrations, the Chinese government finally responds to the protesters in Hong Kong. We are going to go live to Beijing next.

[04:45:00] (COMMERCIAL BREAK)

BRIGGS: 4:48 Eastern Time. Beijing finally addressing the deepening crisis in Hong Kong. In a news conference today following eight weeks of furious protests, riot police firing tear gas and rubber bullets at protesters as the two sides fought pitch battles in residential areas. CNN Matt Rivers live for us in Beijing with the latest. Matt, good morning. What are you hearing?

MATT RIVERS, CNN CORRESPONDENT: Yes, good morning. Well, this is the first time that we've heard at least on camera from officials with the Hong Kong affairs office here in Beijing. That would be the department that is tasked with dealing with Hong Kong affairs, and it's the first time we've heard them really come out on camera in a relatively forceful way.

They have expressed support for the Hong Kong government in the past. But this is the first time they have come out and said it in public. So we heard from a spokesperson today, calling the protests that we've seen for the last two months or so, illegal saying that they're being spurred on by violent protesters, you know, determined to commit illegal acts. He reiterated support for the police and interestingly he reiterated support for the chief executive of Hong Kong. That would be Carrie Lam who protesters have asked to step down to resign for weeks now and she hasn't.

And that impart has led to a lot of the violence that we've seen out on the streets. But this is Beijing lending its support to the Hong Kong government. And interestingly we ask the question because there's a fear that Beijing could deploy troops at some point to try and quell somebody's protests, actually deploy the Chinese army on the streets of Hong Kong. It would be unprecedented.

[04:50:02] We specifically asked if Beijing is going to be doing that. And they didn't answer basically just saying you can look up the basic law for yourselves which would allow troops on the streets of Hong Kong, if the Hong Kong government request it, but they did not confirm that is in the cards, Dave.

BRIGGS: Only adding to the fears that Beijing could send troops there. All right. Matt rivers, great reporting for us this morning in Beijing, thanks.

OK, the woman next in line to be Puerto Rico's governor does not want the job. Wanda Vasquez Garced, Puerto Rico's Secretary of Justice tweeting, she does not want to be governor of the U.S. territory. Saying in Spanish, that she has no interest in occupying the position. Vasquez is next in line for the job after embattled leader Ricardo Rossello announced his resignation Wednesday. Normally the Secretary of State would be next in line, but the man who was Secretary of State Luis Rivera Marin resigned amid the same group chat scandal that led to protests and Rossello's resignation.

ROMANS: All right. Stores that don't sell anything. How will that help traditional retailers take on Amazon? CNN business has the details next.

[04:55:00] (COMMERCIAL BREAK)

BRIGGS: All right. In baseball pitcher typically hands the ball over to the manager when he is being taken out of the game, but there is nothing typical about the Cleveland Indian's Trevor Bauer, because that is what he did before he was pulled from the game on Sunday in Kansas City, turned and fired the baseball over the center field wall. It was gone. Bauer's meltdown came after he gave up seven runs in five innings. He apologized for his behavior after the game, calling it childish, and unprofessional and he said he is in intense competitor and the frustration built up. Manager Terry Francona less than impressed there, you can see go in and seat.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Your world champion!

And a $3 million grand prize to the new Fortnite champ, Kyle Bugha Giersdorf. The first ever championship for the online video game at New York Arthur Ashe Stadium home of the U.S. Open. It was also the biggest ever payout to a single player in an E-Sports tournament. Bugha finished with 59 points, a huge lead over the second place finisher and that was Harrison Chang who took home $1.8 million. At 24 years old Chang was one of the oldest players competing.

ROMANS: All of those lost hours in our basement are now --

BRIGGS: Time well spent.

ROMANS: Investment somehow? All right. Let's get a check on CNN business this morning. First a look at global stocks. You can see a European -- or Asian stocks rather closed lower. European stocks opened mix here. The Hang Seng separate it's biggest dropped in a month and half amid fears about how those protest in Hong Kong could hurt the local economy.

On Wall Street to start the new trading week, looks like absolutely undecided. Stocks finished the week higher after Friday's second quarter GDP report showed the economy grew at 2.1 percent. The DOW closed up 52 points. Both the S&P 500, the NASDAQ closed at all-time highs beating records set Wednesday. The S&P 500 finished up 7 of a percent. All time high of 3026. The NASDAQ closed up 1.1 percent also a record there.

This week is all about the Fed, the policy makers need to decide on a rate cut. Investors are certain that is going to happen. That will be the first rate cut by the way since 2008.

Traditional brick and mortar stores are looking for ways to create distinctive services to fight off Amazon. For Walmart and Nordstrom that means stores that don't actually sell anything. Walmart opened up a Walmart pickup point outside of Chicago earlier this month. Customers drive up to the site, an employee loads up their trunk with their order. Nordstrom has been testing three local hubs in the Los Angeles area with plans to open one in New York City in September. Now the locations are another way retailers are trying to capitalize on the growth of pickup especially among younger and wealthier shoppers.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Must take your place in the circle of life.

(END VIDEO CLIP)

ROMANS: Disney has set the record for the highest grossing year for a studio ever. By the way, only in July they've already set the record for the best year. Brought in a record 7.67 billion to date at the worldwide box office. Beating the record it set in 2016. The House of mouse already has three films that have made a billion bucks this year. Avengers End Game, Captain Marvel, and Aladdin, Toy Story 4 and the Lion King could make it, five of those films have made more than $900 million worldwide. Those record numbers could grow even larger, Maleficent, mistress of evil, Frozen Two and the final chapter of the Skywalker saga, Star Wars the rise of Skywalker, all come out later this year.

BRIGGS: And they will load up with the whole new line up of Marvel films next year and it will keep rolling.

Thanks to all of our international viewers for joining us. Have a great rest of your Monday. For our U.S. viewers, Early Start continues, right now.

UNIDENTIFIED MALE: This is CNN breaking news.

ROMANS: Good morning, everyone. Welcome to "Early Start." I'm Christine Romans.

BRIGGS: I'm Dave Briggs. It is Monday, July 29th, 5 a.m. in the East, 2 a.m. in Gilroy, California, where we begin this morning with breaking news. A family food fest in California farm country turned into a deadly scene of terror.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: What's going on? What's going on?

UNIDENTIFIED FEMALE: Is that fire? UNIDENTIFIED FEMALE: What the (BEEP)'s going on?

UNIDENTIFIED FEMALE: Oh, shooting.

(END VIDEO CLIP)

BRIGGS: A gunman firing round after round at the annual --