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EARLY START

Philadelphia Shooting Standoff Leaves Six Officers Wounded; Bond Market Flashes Recession Warning; China Deploys Paramilitary Units Near Hong Kong Border. Aired 5:30-6a ET

Aired August 15, 2019 - 05:30   ET

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


ALISON KOSIK, CNN ANCHOR: Breaking overnight, another Democrat set to bow out of the 2020 race. We're going to tell you who.

Good morning and welcome back to EARLY START. I'm Alison Kosik. I'm sitting in for Christine Romans.

VICTOR BLACKWELL, CNN ANCHOR: I'm Victor Blackwell in for Dave Briggs. Coming up to the bottom of the hour right now.

(BEGIN VIDEO CLIP)

POLICE OFFICER: Keep your hands up. Keep your hands up.

(END VIDEO CLIP)

BLACKWELL: Breaking overnight, a dramatic end to a nearly-8-hour standoff with a gunman that left six Philadelphia police officers shot.

(BEGIN VIDEO CLIP)

(Gunshots)

POLICE OFFICER: Get up here now. Get up here.

(END VIDEO CLIP)

BLACKWELL: Did you hear the gunshots there? These were terrifying moments on the streets of Philadelphia's Tioga-Nicetown section.

Now, this all started when officers tried to serve a warrant. Listen to the police scanners blaring with these desperate calls for help.

(BEGIN VIDEO CLIP)

POLICE OFFICER: Guys, use caution, please.

POLICE OFFICER: Right now.

POLICE OFFICER: Cars stand by, cars stand by. Second assist, 3715, 150. Shots fired -- shots fired inside.

POLICE OFFICER: Station to 180, shots still ringing out. Give me SWAT ASAP; long guns, ASAP. I've got officers shot. I've got officers shot, radio. (INAUDIBLE).

(END VIDEO CLIP)

KOSIK: That is just chilling.

In the wake of the deadly massacres in El Paso and Dayton, Philadelphia's mayor -- he wants to know when is enough enough.

(BEGIN VIDEO CLIP)

MAYOR JIM KENNEY, PHILADELPHIA, PENNSYLVANIA: It's aggravating, it's saddening, and it's just something that we need -- we need to do something about. And if the state and federal government don't want to -- don't want to stand up to the NRA and some other folks, then let us -- let us police ourselves.

Our officers deserve to be protected and they don't deserve to be shot at by a guy for hours with an unlimited supply of weapons and an unlimited supply of bullets.

So, it's disgusting and we've got to do something about it. And I'm -- we need to do something about it quickly.

(END VIDEO CLIP)

KOSIK: Jason Carroll is in Philadelphia with more on the shooting.

(BEGIN VIDEOTAPE)

JASON CARROLL, CNN NATIONAL CORRESPONDENT: Alison, Victor, it was just around midnight -- that's when we started hearing the officers shouting out on a loudspeaker for the suspect to come out with his hands up. Minutes later, then we heard the command "Get on the ground, get on the ground." Shortly thereafter, police tweeted out that the suspect was in custody and the standoff was over.

This all began yesterday, just at about 4:30 in the afternoon. That's when the initial calls starting coming in.

Police had gone out to this row house trying to serve a search warrant. Narcotics officers responded and they were met by gunfire. Officers had to jump out of a second-story window to escape some of the gunfire. And then, for the next several hours, there was a standoff between the suspect and police.

At one point, two officers were held up on the second floor. They were able to escape by late evening with the help of SWAT.

Six officers were injured during the shooting. Those officers eventually released from the hospital.

A seventh officer actually was injured when he was trying to get to the scene. He was caught in some sort of a car accident. He's going to be OK as well.

Officers, throughout the evening, tried to negotiate and tried to speak with the suspect. They were met by gunfire. And then during the last few hours, there was -- they were met with silence as they kept shouting commands. But then, once again, finally just after midnight the standoff came to an end -- Alison, Victor.

(END VIDEOTAPE)

KOSIK: OK, Jason, thank you.

President Trump's disruption of global norms is now hitting his crown jewel, the economy. Markets tumbled after a warning signal that has an eerily accurate track record for predicting recessions.

The Dow dropped 800 points, the worst trading day of the year. Asian markets, they closed mostly higher although you can see a one percent decline there in the Nikkei. U.S. futures look like they could stabilize a little bit more today.

So what happened yesterday? Investors are concerned about the inverted yield curve. So in basic terms, that's when short-term bonds pay out higher interest than long-term bonds.

The 10-year-yield dropped just below the 2-year bond for the first time since 2007. That spooked investors, so investors are concerned about slowing global growth. So essentially, people are frontloading their investments because they are losing faith in the longer-term economy.

Analysts say the yield curve, though, isn't the only concern.

(BEGIN VIDEO CLIP)

MARK ZANDI, CHIEF ECONOMIST, MOODY'S ANALYTICS: If we're not in a recession globally, we're pretty close, and it's going to weigh on us here. The U.S. economy is starting to struggle and if this -- if the president can't figure out a way to find some kind of face-saving arrangement with China pretty soon, we will be in a recession.

(END VIDEO CLIP)

KOSIK: President Trump blamed, who else but Fed chief Jerome Powell, not his trade war, for China for the sell-off. He got on Twitter and called him "clueless" and saying that the problem is the Fed.

We should note here that the yield curve nearly inverted two months ago and no one panicked, but investors reacted forcefully now because I think it had enough of President Trump's constant waffling on the trade war -- a lot of uncertainty.

[05:35:04] BLACKWELL: So, growth is slow in the U.S. and certainty -- uncertainty in other parts of the world.

CNN's Hadas Gold is live in London with more on the global economic concerns. There are some indicators in Europe and Asia. Just give us an idea of what is feeding this -- Alison used the word "panic" -- this concern around the world. HADAS GOLD, CNN REPORTER, EUROPEAN POLITICS, MEDIA AND BUSINESS: Yes, Victor, it's instability, it's the rise of populism and nationalism rejection. Are we thinking of globalization -- how things have worked over the past few years.

Let's take a little bit of a tour around the world to give you an idea of why there's so much worry out there.

So, aside from fears over the trade war, China has actually had its slowest growth industrial output in 17 years. That's worrying a lot of people.

In Germany, which is Europe's biggest economy, their economy shrank .1 percent and the Eurozone has barely grown.

Then you go into places like India. There's concern about the autonomy of their central banks. There's tensions, obviously, in Kashmir.

And in Argentina, we have huge issues with the peso over there.

And, of course, here in the United Kingdom, we have Brexit. We still don't know whether there's going to be a hard no-deal Brexit on October 31st. But with Prime Minister Boris Johnson now in place, he has said there will be an exit on October 31st, do or die, leading to a lot of businesses to fear that that no-deal Brexit is actually coming.

And in past years, the United States might have been sort of a calming force around the world, especially with issues like Brexit. But now, you have a president who is advocating for that no-deal Brexit -- something that businesses so do not want, Victor.

BLACKWELL: Hadas Gold for us there in London. Hadas, thank you.

KOSIK: Breaking news from the campaign trail. Democrat John Hickenlooper is ending his bid for president. Sources say the former Colorado governor will make a formal announcement today.

He is said to be considering a run for the Senate, something party leaders have urged him to do.

Hickenlooper struggled to break out of the crowded Democratic field. He was a moderate voice making his opposition to Democratic socialism central to his campaign. He was not likely, though, to qualify for the next round of debates in September.

Meantime, Beto O'Rourke plans to return to the trail today. He returned home to El Paso after the Walmart shooting. An aide says O'Rourke will have a refocused image -- a refocused message.

BLACKWELL: Breaking overnight, autopsy results on Jeffrey Epstein reveal multiple breaks in his neck bones. According to "The Washington Post", the breaks are consistent with a person who hangs himself, especially if he's older. Now, the results do not rule out another cause of death but to be very clear, there is no evidence of anything nefarious.

The convicted sex offender died Saturday morning. He was found hanging in his cell at the Metropolitan Correctional Center in Manhattan.

KOSIK: Breaking news now. An Iranian ship detained overseas was supposed to be released today, but the U.S. Justice Department is holding things up.

Nick Paton Walsh joins us live now from London with the breaking details. Good morning to you, Nick.

So, what is behind the Department of Justice's move to keep this ship in place?

NICK PATON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, we don't know precisely now and at 4:00 local time there will be a hearing in the Court of Gibraltar in which the U.S. Department of Justice will present these new allegations.

Now, let me just read out a statement from the Gibraltan government. It says that "The U.S. DOJ has applied to seize the Grace 1 on a number of allegations which are not being considered." Now, obviously, that raises a large number of questions.

Just to recap, the Grace 1 was originally seized by the British government using U.S. Royal Marines around Gibraltar -- which is part of the United Kingdom -- and held because they believed it was going to take oil on to the Syrian government who Iran has sanctioned by the European Union and many other nations to, and that delivery would have been in violation of those sanctions. That was the original logic.

That sparked a series of Iranian reactions, one of which was the Stena Impero U.K.-flagged tanker being taken in the Gulf of Hormuz at the same time -- the Strait of Hormuz. And then that also sparked the U.S. and U.K. to come together and try and protect shipping going through that area flaring up the tension here.

Now, originally, the Grace 1 had been suggested by the foreign minister of Spain -- had, in fact, been detained at U.S. request. That was denied by the United Kingdom and by the government of Gibraltar as well.

But this strange last-minute intervention by the U.S. DOJ with these new allegations would, of course, make people wonder exactly how initially this all started in the first place. And, of course, asks the question, too, if the United States was in possession of allegations against this tanker, why wait until the eleventh hour to actually put them to the Gibraltan court?

Now, a separate issue in this, too, the crew of that tanker -- we understand from the Gibraltan government -- has been released at this point. It is presumably the tanker which they are focusing these new allegations towards, although we don't know necessarily if the U.S. DOJ are also suggesting some link between the crew and the tanker in whatever they're presenting. But we now have what we thought was going to be a day of great de- escalation in which we'd see the U.K. perhaps release the Iranian tanker and then, presumably, hope to see reciprocal moves by Tehran.

[05:40:03] Now, instead, we have U.S. lawyers racing for the court, it seems, for a last-minute bid to keep that tanker where it is in detention.

The big question, why? What is it that they believe it has onboard that means it is essential for it to stay in U.K. custody?

Given that what this has done, generally speaking, in terms of escalation in the region and how -- given how Donald Trump has other things on his plate right now, that seemed to have calmed down somewhat. We'll learn in the hours ahead.

KOSIK: Yes, we will be learning, hopefully, at 4:00 p.m. You said the hearing in the court of Gibraltar. Thanks so much.

WALSH: Local time -- 10:00 your time.

KOSIK: Thanks very much, Nick Paton Walsh.

BLACKWELL: Well, China has troops near the border with Hong Kong. What message is Beijing sending after months of protests? CNN is live near the border. That's next.

(COMMERCIAL BREAK)

BLACKWELL: Sixteen minutes until the top of the hour now.

[05:45:00] Chinese paramilitary forces are gathering near Hong Kong's border. Observers say it's intended to send a message to protesters who have disrupted Asia's key financial hub.

CNN's Matt Rivers is live in Shenzhen, China. And, Matt, let's start here. This is just to send a message. No indication that they are going to advance -- to intervene in these protests that have been going on for three months now.

MATT RIVERS, CNN INTERNATIONAL CORRESPONDENT: That's right, Victor. That's a really important point.

It was late Wednesday evening when we were actually able to get our eyes, for the first time, on these members of what's called the People's Armed Police Force. It's China's paramilitary force that is used throughout the Mainland to quell protests whenever they kind of rarely pop up.

And so that's why it was so striking to see large numbers of them deployed just a few miles away from where we're standing here. That, right there, is the border, right on the other side of the water there. That is Hong Kong.

But it's really important to note that there's a big difference between deploying some troops and being ready for the so-called nuclear option, which would be sending troops into Hong Kong and actually preparing to do that.

There is no sign of an imminent deployment and that's really key because Beijing would have to deal with massive consequences were it ever to do that. It would essentially destroy a key financial hub for the international community and a huge foreign direct investment tunnel to the Mainland.

And it's going to be -- take a lot more than what's going on in Hong Kong, right now, to get them to do that. That said, it's newsworthy that these forces have been compiled on this part of the region.

Now, this comes as President Donald Trump has tweeted about potentially meeting with President Xi. We'll have to wait and see if that's going to happen.

BLACKWELL: Matt Rivers for us there in Shenzhen. Matt, thank you.

KOSIK: OK, let's get a check on "CNN Business" this morning.

Asian markets closed mostly higher, although you can see a one percent decline in the Nikkei. European markets are currently lower.

On Wall Street, it looks like U.S. futures are kind of losing steam. They were higher earlier this morning.

Markets, though, as you know, tumbled Wednesday after the bond market flashed a recession warning.

The Dow tumbled 800 points. It's the fourth-biggest point drop in history. The S&P 500 closed down 2.9 percent. The Nasdaq fell three percent.

And just in this morning, Reuters is reporting China's Finance Ministry said the country has to take countermeasures once U.S. tariffs take effect September first. That may be weighing on investors this morning.

Macy's had a rough spring, the latest sign of pressure on the battered department store sector. Its profit fell 48 percent during the second quarter.

Macy's said it had a fashion miss with its athletic brand and struggled to sell warm-weather gear. So that left the company with too many clothes, forcing it to put them on sale.

Sales at department stores have dropped 4.3 percent over the past six months. Retailers are also worried about the ongoing trade war with China.

Amazon is beginning a new program to keep unsold merchandise out of the garbage. The new program called "Fulfillment by Amazon Donations" will donate products that its third-party sellers were unable to sell to charity.

Amazon drew criticism overseas following reports that flat-screen T.V.s, toys, and other items were being dumped in France and Britain. The program begins in September in the U.S. and the U.K.

And we'll be right back.

(COMMERCIAL BREAK)

[05:52:46] BLACKWELL: Former Secretary of State Madeleine Albright is lashing out at a top immigration official for suggesting only immigrants who can stand on their own two feet are welcome in the United States.

Albright has been a refugee twice in her life, once from the Nazis.

(BEGIN VIDEO CLIP)

MADELEINE ALBRIGHT, FORMER U.S. SECRETARY OF STATE: This country has benefitted by the diversity that has come through immigration. And so, I find it one of the most un-American statements I've ever heard.

And you pointed out that I have a Statue of Liberty pin on. I think the Statue of Liberty is weeping.

(END VIDEO CLIP)

BLACKWELL: Albright says she will always remember seeing the Statue of Liberty when she sailed by it on her way into the United States.

KOSIK: Another New York City police officer has died by suicide. He's the ninth to do so this year, the second this week, and the seventh since June. The officer was a 25-year veteran of the force.

Over the past five years, the NYPD has averaged between four and five suicides a year. The department is developing a plan to help troubled officers. Beginning this month, some 800 staff members will begin retraining with experts on mental health, stress, and suicide.

BLACKWELL: An epidemic of gun violence in St. Louis. Police say seven children have been killed by gunfire this year.

The latest victim, 7-year-old Xavier Usanga. He was killed while playing with his sisters in their backyard. He was supposed to start second grade this week.

Xavier's mother says two men were shooting at each other in the street when her child became the latest innocent victim.

(BEGIN VIDEO CLIP)

DAWN USANGA, 7-YEAR-OLD-SON KILLED DURING SHOOTING: Take into consideration what you might -- what is the end result and if you're ready to take responsibility for that end result. Playing with a gun might be fun -- it might be something -- but do you really know at the end of the day if you take someone's life what that feels like?

(END VIDEO CLIP)

BLACKWELL: Well, police say they have arrested a suspect in connection with Xavier's shooting.

But the problem goes beyond guns. A dozen kids have been killed in St. Louis since May.

KOSIK: Funny, articulate, intelligent, and a mass murderer. Now the parents of a Dayton shooter are apologizing for describing their son in glowing terms in an obituary on a funeral home's Web site.

[05:55:02] The Betts family posted glowing remembrances of the gunman and his younger sister, who was killed in the rampage. Connor Betts' eulogy was removed Wednesday at the family's request.

BLACKWELL: It was replaced by a note from his parents expressing their regret for the wording, noting it was "...insensitive in not acknowledging the terrible tragedy that he created."

Neither obituary mentioned the Dayton massacre.

KOSIK: A warning from Microsoft. Update your Windows 10 operating system immediately. The company says there are two critical vulnerabilities that are potentially wormable. That means affected computers could spread viruses and malware without any action on your part.

Microsoft confirms there are potentially hundreds of millions of computers that are susceptible. Windows 10 users that have enabled automatic updates are already protected. For those who update manually, search Windows update to access the update tool.

BLACKWELL: A setback for the U.S. women's soccer team in its fight for equal pay. Mediation talks with U.S. Soccer broke down on Wednesday. The case now appears to be headed to federal court.

A spokesperson for the players says they are sorely disappointed by the Soccer Federation's determination to operate, quote, "a fundamentally discriminatory workplace."

They released this statement. "We want all of our fans, sponsors, peers around the world, and women everywhere to know we are undaunted and will eagerly look forward to a jury trial."

The U.S. Soccer Federation says lawyers for the women's team took an aggressive and unproductive approach. The women's team does make less than the men but their revenues are also a lot lower.

Both sides agreed to mediation after the women won their fourth World Cup in France in July.

KOSIK: It's raining plastic? A government study of rainfall in the Rocky Mountains found plastic was present in 90 percent of the samples. It was mostly in fiber form and came in a variety of colors. Scientists used a binocular microscope fitted with a digital camera to see the particles.

It is not clear where the plastic is coming from but plastic contamination has been a growing global problem. Several studies are being conducted to determine the health effects of living with all this plastic.

BLACKWELL: Late-night comedy in the era of Trump. In a rare interview, the Stephen Colbert show host, Stephen Colbert, tells CNN's Anderson Cooper President Trump wants to live in a fantasy world. Colbert calls it "heresy against reality."

Now, the president was on Colbert's show during the 2016 campaign. Colbert says that will not happen again.

(BEGIN VIDEO CLIP)

ANDERSON COOPER, CNN ANCHOR, "ANDERSON COOPER 360": Would you want to have Trump on your show again?

STEPHEN COLBERT, HOST, CBS "THE LATE SHOW WITH STEPHEN COLBERT": The quick answer would be no because I -- it would be hard for me to be properly respectful of the office because I think that he is so disrespectful of the office that it's very hard to perceive him as I would want to perceive a president in terms of their status and the dignity and their representation of the United States.

So I think just for safety's sake it wouldn't be a good idea.

(END VIDEO CLIP)

BLACKWELL: Watch Anderson's full interview with Stephen Colbert in a prime time special tonight at 9:00 Eastern right here on CNN.

KOSIK: Imagine if Trump Tower ended up on Obama Avenue -- hmm -- and imagine the tweets --

BLACKWELL: Imagine.

KOSIK: -- from President Trump.

A petition is circulating in New York City to rename part of Fifth Avenue in honor of Barack Obama. The one-block stretch happens to be the home of Trump Tower.

About 250,000 people have signed the petition. It hails President Obama's signature achievements, like taking out Osama bin Laden and serving two scandal-free terms.

One problem here, though. Guidelines for renaming a street require the honoree to be dead for at least two years, although rare exceptions can be made -- hmm.

Thanks for joining us. I'm Alison Kosik.

BLACKWELL: "Hmm," she says.

KOSIK: I'm going to say anything.

BLACKWELL: I'm Victor Blackwell. "NEW DAY" starts right now.

KOSIK: Have a good day. (BEGIN VIDEO CLIP)

POLICE OFFICER: 3750, 150, shots fired, shots fired.

BLACKWELL: A nearly-8-hour standoff ending in surrender.

UNIDENTIFIED MALE: Officers were serving a narcotics warrants. The gunfire erupted and the shooter fired multiple rounds.

UNIDENTIFIED MALE: Officers were having to bail out of windows trying to escape with their lives.

UNIDENTIFIED FEMALE: We're down 800 points. Investors sending a very clear signal to Trump they do not like his ill-planned trade war.

UNIDENTIFIED MALE: The underlying fundamentals of the U.S. economy are solid as a rock. This is the Fed slowdown.

ZANDI: If we're not in a recession globally, we're close. It's going to weigh on us here.

(END VIDEO CLIP)

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

JOHN BERMAN, CNN ANCHOR: All right, welcome to our viewers in the United States and all around the world. This is NEW DAY. It's Thursday, August 15th. It's 6:00 in New York.

And we do have breaking news. A suspect is in custody this morning after a dramatic 8-hour standoff -- a shootout that left several Philadelphia police officers wounded.

(BEGIN VIDEO CLIP)

(Gunshots)

POLICE OFFICER: Get up here now. Get up here.

(Gunshots).

END