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Markets Open Higher amid Trade Talks; Trump Isolated on World Stage; California Deputy Makes up Story of Sniper; Judge to Rule in Opioid Lawsuit. Aired 9:30-10a ET
Aired August 26, 2019 - 09:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:30:15] JIM SCIUTTO, CNN ANCHOR: This just moments ago. Harvey Weinstein arrived at a New York City courthouse. He will be arraigned this morning on a new, undisclosed indictment returned by a grand jury. We don't know if additional charges will be brought against Weinstein as a result, but it is expected the court will address his change of venue request. He has said he cannot get a fair trial in New York.
Meanwhile, we are waiting for President Trump to speak this morning from the G-7 Summit in the south of France, this as questions remain about phone calls the president claims that Chinese officials made to U.S. counterparts about a possible trade deal. Neither the president nor his treasury secretary were willing to confirm that those phone calls actually took place.
The news sent futures into positive territory. And you can see the market opening a short time ago, going up about a percent there. Prior to that, futures had indicated a downturn, but many people are asking this question, is the president telling the truth about those phone calls or was his intention exactly that, to move the market?
CNN business coordinator Alison Kosik, she covers this market. She's been speaking to people on the floor this morning.
Alison, do they believe that there san actual positive development in these talks?
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: You know what, Jim, I think at this point, a lot of investors and traders here at the New York Stock Exchange are pretty skeptical whether or not that meeting happened or that conversation happened about the trade deal moving forward, about discussions about a trade deal.
You know, it is interesting to see, though, how stocks look. Literally erase that -- those sharp losses in the pre-market, doing a u-turn.
You know one point that investors are focusing on here is the Chinese foreign ministry, which held a briefing today and didn't mention the calls that the Trump administration is talking about, that Trump is talking about. So, once again, traders are skeptical that the phone call or any communication like that happened. One trader telling me, unless the administration proves the conversation with China actually happened, you may see the market kind of back off today, especially if China comes out more officially to say it never happened.
Other traders telling me, listen, this feels like market manipulation by President Trump, either for Trump to enrich himself or to enrich those in his circle who may be profiting from this because if you see what's happened just over the past few days, the market tanked on Friday and then with a few words about positivity and the trade negotiations, you're seeing the market jump again. It is leaving a lot of skepticism here on Wall Street.
SCIUTTO: Well, that's a pretty remarkable suspicion there, that the president manipulated the markets both for political reasons, possibly, at least from the view of some in the market, for financial reasons.
Alison Kosik, great to have you on the floor there.
Let's speak now to my team of experts.
Nia-Malika, you were listening to that. The thing is the president has a doubtful track record, to say the least, about his handling of the truth. He speaks mistruth all the time.
What do you see in the president's comments this weekend? Did he see a falling market and say I've got to share some positive news?
NIA-MALIKA HENDERSON, CNN SENIOR POLITICAL REPORTER: Yes, I think that's probably right. I mean if you noticed on Friday, you saw that big dip in the -- in the market and he sort of waited until after the markets closed to announce his tariffs. Then he had the kind of walk back where he was like, oh, I kind of regret it. And then he had another walk back, which was, I actually don't regret it. I wish there were higher tariffs. And then he seems to have made up this story going into the opening of the markets this morning, saying that there were high level talks. No evidence of that.
So, yes, I definitely think he has an eye towards the market. And he always has, right? I mean the sort of -- the strength of the market he has seen as his strength as the president, right? I mean he's gone before audiences and said, how's your 401(k) doing, to many audiences, and so that has been, you know, the world in which he's viewed his own success. And, obviously, when it takes a dip, I think on Friday he sort of blamed Seth Moulton or something, dropping out of the race.
HENDERSON: But what's interesting here, I mean, we look just kind of broadly at what this president's promises were. On all of these things he pulled out of, the climate deal, the Iran nuclear deal. He essentially promised that he could have a better deal, right? He could have something better than TPP --
SCIUTTO: Right. HENDERSON: Which itself was supposed to contain China. A better deal than the climate deal. And something like North Korea, he was going to contain their nuclear program. If anything, they probably have more nuclear weapons now than they did at the -- at the start of President Trump's presidency.
And all of this, also, was supposed to bring manufacturing jobs back to the middle of the country. That hasn't seemed to happen either.
HENDERSON: So everything he's promised in terms of the success he could have after particularly these trade wars hasn't really happened so far.
[09:35:03] ABBY PHILLIP, CNN WHITE HOUSE CORRESPONDENT: And on China in particular, he -- the strategy with China has always been, use tariffs as a negotiating tool to force China to the table, to force them to make concessions. It's clear at this point that that has not worked. And, in fact, we've gotten into the spiral of escalating tariffs month by month by month.
The president doesn't have a strategy to get out of that. And so he's trying to rely on just using rhetoric to affect the markets, as Alison noted, is the suspicion on Wall Street. And the reality is that behind the scenes his aides are basically where they've been all along, trying to get China to make some big concessions for them on some really intractable issues. And even as these talks have continued, there's really no indication that China is either ready or really able, politically, internally, to make some of these changes.
The talks are continuing. But there's just really no progress. And the secrecy of these talks, which has been pretty persistent for over a year, is actually, as a reporter, when you're trying to get answers from the White House about where exactly are you on these things, they don't want to tell you because they don't want to have to admit when things are stalled, when things are backtracking. They're just simply not saying anything at all.
And so I think, as a reporter, I think as viewers, people have to operate in a wait and see moment. There is no progress until there is actual progress despite the kind of talk that comes from President Trump on a regular basis.
SCIUTTO: Jill Dougherty, there's a report this weekend from "Axios" that the president discussed using nuclear weapons to stop hurricanes from reaching the East Coast, and I'm speaking the truth here, and Jonathan Swan, who reported that story, is standing by his story here.
You spent a lot of time in Europe. You know the actual danger and concern of nuclear weapons, particularly with Russia's withdrawal now from a medium range ballistic missile treaty. Talk about what the real nuclear issue is.
JILL DOUGHERTY, CNN CONTRIBUTOR: Well, I'm putting myself in the place of the people who are sitting there representing European countries knowing that with the end of the INF, the Intermediate-Range Nuclear Forces treaty, which the United States pulled out of, and then within days tested a weapon that would have violated that agreement, and now the Russians -- remember about a week or two ago when the Russians -- there was an accident --
DOUGHERTY: In the north when they were testing a similar type of missile.
So what we've got right now is the beginning, scarily enough, of, you know, a possible arms race.
DOUGHERTY: And so who is going to be hurt by the end of the INF?
DOUGHERTY: Intermediate range are like more than 300 miles. So it ain't going to hit the United States. These -- we've got those already. It's weapons that will be very dangerous for Europe.
And it raises the issue of whether the United States might want to begin to put back weapons a la the 1980s into Europe, which was extremely divisive and very dangerous.
SCIUTTO: Yes. Yes.
DOUGHERTY: So really, you know, it -- all of this, there are these very serious issues that are out there, nuclear weapons, just security in Europe, and climate change and other issues that the White House is calling tangential.
SCIUTTO: And the president -- and the president is talking about using nukes to stop a hurricane.
SCIUTTO: Which is, again --
DOUGHERTY: Well, I mean --
SCIUTTO: It's -- apparently it's documented, so says "Axios."
Molly, is the increasing volatility, if that's the right word, coming from the president, from the White House and the president's mouth here, is that being -- affecting him politically in the U.S.? I know that a lot of folks turn their ears off to this because they're like, well, it's Trump being Trump, but is it beginning to affect him politically here?
MOLLY BALL, CNN POLITICAL ANALYST: Well, yes and no. I mean we've seen his approval rating be quite stable over the course of his presidency. In part, I think, because the volatility isn't really increasing all that much. He's been this volatile the whole time and people have correctly perceived that and he has been unpopular for the duration of his presidency.
But, you know, to go back to the China thing, I think it dovetails with this because what the markets heard, it wasn't necessarily that they believed these phone calls happen, but what they heard was a president saying, I don't like seeing the market go down and I'm willing to do something about that. And that gladdened the market because it meant he's not so dug in on this tariff strategy that he's actually telling American companies, pull out, it's over.
And so you have a president whose sensitive to dips in the market, who's very sensitive to perception, who's sensitive to things that he thinks are harming him politically, particularly with his base of supporters. And so that -- that information also tells the Chinese, right, that they sort of got him where they want him because he doesn't want to see -- he doesn't want to walk away from the table.
SCIUTTO: Yes. It's a pressure -- it's a pressure point. It's a -- yes.
BALL: I mean any negotiation -- any negotiation where you have someone who's afraid to walk away from the table, that gives you a lot of leverage if you're the other side. And so what he's signaled to the markets is, yes, the Chinese have some leverage here, yes, I'm willing to make concessions, yes, I'm willing to do something to make sure that we don't go into this full on stalemate, yes, we're still talking because he wants the markets to believe that there is still a possibility that the U.S. is still willing to make concessions.
[09:40:14] SCIUTTO: It's interesting. What you basically have is China turning art of the deal on the president there.
Everyone stay with us. There's more to discuss.
We are waiting for the president's news conference. It is coming up shortly at that podium there in France. We're going to bring it to you, of course, live when it begins.
We are watching other news this morning. Authorities in California have launched a massive manhunt after an L.A. County deputy said he was shot by a sniper. They had launched that manhunt, but now investigators say the deputy made the entire story up.
[09:45:04] SCIUTTO: Welcome back.
A Los Angeles county sheriff's deputy will now lose his job after he admitted that he entirely made up a story about being shot by a sniper. The deputy said he came under fire last week as he walked to his personal vehicle outside the sheriff's station. But authorities now say that everything was false and staged.
Stephanie Elam joins me now.
Stephanie, there was just a massive police response here, a massive police manhunt after this false report here.
What are the consequences going to be beyond losing his job?
STEPHANIE ELAM, CNN CORRESPONDENT: There are a lot. Think about this. Your -- this man tried to dupe, allegedly, the people who are trained to do these kind of investigations. And what they're saying happened is that he went out to his car -- if you listen to even what he radioed in saying that he needed help, this 21-year-old Angel Reinosa, he said that he took -- he heard two shots go off, that he had been hit in his bulletproof vest. The story was that it ricocheted off of that and hit him in his right shoulder.
But now they're saying that his implication that it was coming from the four-story apartment building across the street, that led for them to lock down that building, go through that building. All they recovered was a pellet gun. They also locked down a nearby school when they were going through all of this.
But they're now saying that actually this deputy used a knife to put two holes into his uniform to look like bullet holes and that there was no shooting wound but just a grazing wound. Well, now they're all saying all of this made up.
Obviously there's a lot of people who are very embarrassed about this. But as the investigation began, there were questions. Listen to what one of the captains had to say.
(BEGIN VIDEO CLIP)
CAPTAIN KENT WEGENER, LOS ANGELES COUNTY SHERIFF'S HOMICIDE BUREAU: There were several things that were curious, either the evidence that was recovered, or the lack of evidence. There was no ballistic evidence in the parking lot at all.
There were many people that were in the vicinity, both in the parking lot and in the apartment complex, who didn't hear any shots. So there were -- there were many things that didn't add up.
(END VIDEO CLIP)
ELAM: They didn't recover any bullet casings, nothing. There was nothing there, even though they had this massive response.
So, obviously the big question here, Jim, is, the motive here. And what we are hearing is that the deputy's performance will be investigated as a possible motive. But, still, it's unclear why this 21-year-old took this on. And now there's going to be a further investigation. He could be actually facing charges here.
SCIUTTO: So you're saying that his motivation here was to improve his performance evaluation, is that the suspicion?
ELAM: No, no, more -- more like if he wasn't doing well in his performance and so therefore that this could have been it. But that's still not clear yet if that's the reason that that's the motive. Not to improve it so much, but maybe just sort of maybe distract in
some way. But, still that's -- that's not clear at this point that that's the motive. That's the question that everyone wants answered.
SCIUTTO: Lots of financial cost to the response, the fear involved, the school on lockdown.
Stephanie Elam, thanks very much.
Can drug companies be held responsible for the opioid epidemic in the U.S.? That's what a judge in Oklahoma will decide today. What this decision means for future cases. There are lots of them. Billions of dollars at stake. It's all coming up.
[09:52:39] SCIUTTO: Today, a judge in Oklahoma will deliver a decision in the state's historic opioid trial. He will decide if a drug company can be held liable for the opioid epidemic in this state and, more broadly, in this country. Oklahoma says that Johnson & Johnson created a public health crisis there by oversupplying the pain killers. The state wants $17 billion to fight the ongoing epidemic. Johnson & Johnson denies any wrongdoing and says it is being made a scapegoat.
CNN's Alexandra Field is in Norman, Oklahoma.
So, Alexandra, how important is this case, because, of course, Oklahoma, just one of dozens of states that are prepared to take the opioid manufacturers to court here.
ALEXANDRA FIELD, CNN CORRESPONDENT: Absolutely, Jim.
Look, Oklahoma is going after a whopping figure, the $17 billion. But the implications are much more far reaching, much more wide reaching than that. This is a moment for other states across the country to sit back and watch how this case unfolds in court because this is the first time a state has actually made it to trial against a pharmaceutical company alleging that the company holds responsibility for fueling or spurring the opioid crisis. This will also be an opportunity for pharmaceutical companies to watch and see whether or not they are going to go to trial in other states or settle the matter outside of court before they get to a trial. Not to mention the fact that you've got a big federal case coming this fall that has 2,000 claims from various cities, counties, municipalities, which all allege that the pharmaceutical companies should be held responsible for playing their part.
So, certainly, all eyes will be on the verdict in just a couple of hours here.
SCIUTTO: So the drug maker's defense is in part based on the fact, and it's true, that opioids did have a legitimate medical purpose, in particular easing the pain. It was designed for cancer sufferers, other sufferers of disease. Of course countered by the many others who ended up getting these pills without that kind of condition.
So how does Johnson & Johnson play this out?
FIELD: Yes, these are legal prescription drugs. So, of course, Johnson & Johnson has been focusing on that. The argument from the state is that the sales and the marketing surrounding two of the drugs drove this crisis. They essentially say that the risk was minimized and that the drugs were pushed.
But for its part, Johnson & Johnson, which, again, manufactures and markets these legal prescription drugs, say that they committed no wrongdoing. They say they played by the rules. They say that they followed the law. They do not think that the public nuisance claim will hold up. The state says that Johnson & Johnson created a public nuisance, costing the state billions of dollars and devastating thousands of lives.
[09:55:13] But the biggest sign of the strength of Johnson & Johnson's case, in their opinion, Jim, is the fact that they decided to go to trial because, of course, two other pharmaceutical companies decided to settle with the state of Oklahoma to the tune of hundreds of millions of dollars before ever getting to court.
SCIUTTO: Alexandra Field, certainly worth watching that case there in Oklahoma. It will have national repercussions.
Still to come this hour, President Trump set to take questions at the G-7 Summit in just minutes. How will he answer to all the contradictory statements coming from the president and the White House this weekend. We're going to bring it to you live from the podium shortly.