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Dow Drops on Coronavirus Warning; Rep. Eric Swalwell (D-CA) is Interviewed on Coronavirus Response; Shooting at Milwaukee Brewery. Aired 9:30-10a
Aired February 27, 2020 - 09:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JIM SCIUTTO, CNN ANCHOR: Let's get right to Wall Street. And there you see. The market down more than 500 points three minutes into the open there. Nearly 2 percent. It's continuing a string of days of losses.
POPPY HARLOW, CNN ANCHOR: This morning, Goldman Sachs is warning U.S. companies will likely see no earnings growth at all this year because of the coronavirus outbreak. Obviously, that note rattling markets.
Christine Romans back with us. Alison Kosik joins us from the New York Stock Exchange.
Romans, let's begin with you.
Is this all a reaction to Goldman's warning?
CHRISTINE ROMANS, CNN CORRESPONDENT: It's a reaction to six days now of selling, quite honestly.
ROMANS: And when you look at European shares, they were down hard overnight as well. The Goldman warning, I think, crystallizing what is the fear among so many business owners, business leaders and investors that the coronavirus is really going to disrupt supply chains, it could hurt demand for certain kinds of industries. And there's a lot of uncertainty about it.
Goldman Sachs saying that they expect no earnings growth this year. Companies will actually lose money in the first half of the year. That's their new base line. And then they go further. They say, if you have a prolonged problem, a pandemic, that could cause a recession in the U.S. That's not their forecast, but they're saying if this new base line they have turns out to be worse, you would have a recession in the U.S.
The U.S. consumer is very strong. I think that's really important to mention. Unemployment is still very low. Wage growth this year, you could have the consumer honestly being the part of the economy holding things up, not companies.
SCIUTTO: So the concern here, right, Alison, is this is not just a sentiment thing. This is in the numbers. If China is making less stuff, buying less stuff, including from the U.S., if airlines are flying less, which they are doing, if trains are traveling less, carrying less stuff, if ships aren't carrying the -- you know, this is real effects on the global economy here.
As you speak to traders on the floor there, are they, like Goldman Sachs, speaking of a year where U.S. companies are just making a lot less money?
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Well, I was talking to some traders this morning who tell me that they think that Goldman Sachs' sentiment is a little inflammatory, though it's hard to see how Goldman could be off the mark, at least for the first and second half of the year.
You think about what makes up the foundation of the stock prices that we see in each and every one of the companies that make up the Dow and the S&P and the other indices, it is company profit. And the thing is, with the coronavirus, it's like a double whammy for these companies.
Not only are they being hit by the supply chain just disruptions because of the coronavirus hitting China, which is clearly interconnected with so many U.S. companies, U.S. companies are also getting the double whammy, the second part of that, by demand. The worries that you're seeing in the plunging prices right now on Wall Street, the worries are that demand will fall. And that is -- goes right to the consumer. The worry is, is that the consumer will pull back.
You're seeing Wall Street actually prepare for the "r" word, for a global recession. The concern is, is that if this goes on long enough, we could see a global recession. And so you're seeing stock prices being priced for that new landscape.
HARLOW: Christine, Alison, thank you. The "r" word, not something people want to hear right now, but we'll see what happens.
ROMANS: There's always a chance it's an overreaction too.
ROMANS: Markets react and overreact. We all know that. We've seen it a million times. A reminder, over the past ten years, the S&P 500 is up, like, what, 185 percent?
ROMANS: So take it all with perspective.
SCIUTTO: Absolutely. Take time. And we'll report it as it happens.
Thanks to both of you, Alison, Christine.
President Trump has tapped Vice President Pence to oversee efforts to control coronavirus. Is the administration doing enough, spending enough to prevent the spread?
HARLOW: Also, turning the corner here, Queen Elizabeth takes the throne, but soon faces scandals and rumors involving her sister, her marriage and the royal monarchy. "The Windsors: Inside the Royal Dynasty," we have a new episode this Sunday night, 10:00 Eastern, right here on CNN.
SCIUTTO: As we speak, health officials in California trying to track down where a new coronavirus case there originated. The CDC says it could be the first example of what's known as community spread here in the U.S. That would mean no direct tie to someone who travelled to China. There are now a total of 60 coronavirus cases around the country.
Joining me now, Democratic Congressman Eric Swalwell of California. He serves on both the Intel and Judiciary Committees.
Congressman, thanks for taking the time this morning.
REP. ERIC SWALWELL (D-CA): Of course. Good morning, Jim.
SCIUTTO: So, first question, the simplest one, the president's now appointed Vice President Pence to lead on the coronavirus response. Is the administration doing enough, and if not, what more do they need to do to lead on this?
SWALWELL: Well, we want the administration to succeed, and we're rooting for the president's success. His success is all of our success. So if Vice President Pence is going to lead this, well, I hope he brings on board experts in disease and infectious, you know, control.
But, Jim, the president's budget did cut by $700 million funding for the CDC. He's asking for a number much lower in his $2 billion request to take this on. So I hope he works with Congress. We have a shared interest in making sure that we get this right.
SCIUTTO: We had a remarkable moment in the White House yesterday during the president's press conference in which the president said, listen -- seemed to downplay the risk of the spread. Also seemed to exaggerate how fast a vaccine could come, whereas the head of the NIH, the infectious diseases experts, says, actually it's going to be many months before there's any sort of vaccine and that the danger of spread here in the U.S. is very serious.
Is the president misleading the American people about the virus and the outbreak?
SWALWELL: Again, Jim, I don't want to attack the president on this. I want to work with him and educate him and be a part of the solution because we can't afford a crisis, whatever his motives are to avoid one, we want to get this right.
So it's not just developing a vaccine, which I believe is about a year out from the health experts I've spoken to, but making sure locally that our hospitals are ready, making sure that we are able to not only have a cure in a year but early detection is critically important. So we want to give the administration the resources they need to do this and give the president the best experts that he can have to make sure that he's informing the public in an educated way.
SCIUTTO: Right, and I'm sure that's what the public wants.
On to the 2020 race, if I can. Of course, we have the important primary coming up in South Carolina, then Super Tuesday. Senator Bernie Sanders leading in most of those races. Is Sanders too liberal to win in November?
SWALWELL: No, but I think it's early. And, you know, I think there are a number of people who could beat Donald Trump and also unite the country. And I'm most concerned about, what is the day after Donald Trump look like? Do we have a president who can bring Republicans, Democrats, independents together, pick us up out of this deep, dark hole that the president has taken us into and move us forward? And so I think it's early, Jim, and I wouldn't -- I wouldn't count, you know, any of the major campaigns out just yet.
SCIUTTO: Let's talk about down ballot races because some of your Democratic colleagues have expressed genuine concern, even fear that with Sanders at the top of the ticket, Democrats would pay a price down on the ballot. And as you know, in 2018, a lot of the seats that Democrats picked up, as you flipped the House, were in moderate districts, were in districts that, for instance, voted for Trump in 2016.
Would Sanders hurt or help Democrats like yourself running for congressional seats in the fall?
SWALWELL: Well, again, I think this is largely going to be a referendum on the president. And when you look at the head-to-head matchups in Pennsylvania, Wisconsin, Michigan, Sanders is beating the president in many of those contests.
But when it comes to health care, I saw this when I ran for president. It was only a cup of coffee, Jim, if you remember, but people across the country, they want to see greater access to health care and much less costs when it comes to health care. But they want to have the choice to decide on their own.
If a public option gives them Medicare, they want to have that choice. But if they like their private insurance, they want to be able to keep that, too. And that's a sentiment we saw in those races that we picked up that you alluded to.
SCIUTTO: Right. And that's obviously a position that differs with that of Bernie Sanders.
SWALWELL: Yes, it is.
SCIUTTO: I want to go on, since you're a member of the House Intelligence Committee. The president's consideration of a new director of national intelligence, the senior most intelligence official in the country. It's CNN's reporting that he's talking to a number of names that have come up in the past, including John Ratcliffe, one of your Republican colleagues on the Intel Committee. But that his key measure seems to be, or that the president is looking for loyalty in whoever he chooses for the post. Is that the correct criteria for choosing the DNI?
SWALWELL: Yes, if you're looking for loyalty to the facts, loyalty to our national security, loyalty to the integrity of our elections. And there's no shortage in our country of people who are qualified to do that job. But if you're looking for loyalty to the president's personal, political and financial interests, that's going to be a problem. And we are already seeing that play out as he clears the decks and gets rid of people who are coming to Congress and telling them -- telling us, you know, information that the president doesn't want us to hear.
SCIUTTO: Yes. And some of that information the president did not want to hear, as you well know, reporting in the last couple of weeks, is about Russian interference again in 2020. And as to whether there's evidence that Russia again prefers Donald Trump as the candidate in 2020.
Since, as we're seeing the interim DNI, Rick Grenell, making a lot of heads roll, right, fining (ph) senior intelligence official who he does not believe are sufficiently loyal to the president. Do you have confidence that someone in this administration is focused on protecting this next election, or are they more interested in protecting the president's personal interests?
SWALWELL: No, I have all the confidence in the world in the line deputies at the U.S. Attorney's Office, the FBI agents, the CIA officers who are out there. But they're not behind the steering wheel. And the person behind the wheel controls the direction and the pace at which we go. And right now the president is not giving the directives that we need. So they can only do so much.
But, Jim, I don't want people to panic about the outcome in 2020 because we can't control it as far as what the president does. What we can control is we can overwhelm the ballot boxes in a way that our votes will not be denied.
SCIUTTO: Do you have any concern that the results could -- are under threat at all from foreign interference in 2020, or have steps been taken, necessary steps, to protect the election process?
SWALWELL: We have taken all the steps we need to in the House with the bills we've passed for election security. Senator Majority Leader Mitch McConnell won't take up those bills. So the next best thing we can go is to go to the courts to protect the right to vote, but also, as I said, just move with our feet to the ballot boxes so that the outcome cannot be denied. Otherwise, if we, you know, create panic or, you know, say the outcome may be in question, people may not go out and vote at all. And we don't want that result.
SCIUTTO: We do not.
Congressman Eric Swalwell, a pleasure to have you on the show.
SWALWELL: My pleasure. Thanks, Jim.
HARLOW: Well, another tragic mass shooting in America. This morning, investigators in Milwaukee are trying to figure out why a gunman opened fire on his co-workers at a brewery there killing five innocent people. The latest on that, next.
SCIUTTO: A landmark brewing complex in Milwaukee, it's shut down now for the rest of the week. This after an employee there shot and killed five of his co-workers, then took his own life. First responders describe the scene as a war zone yesterday. Police say the victims may not be publicly identified until tomorrow.
HARLOW: Our Omar Jimenez joins us now outside of the Molson Coors brewing plant in Milwaukee.
I mean it was, you know, as these e-mails started coming in yesterday afternoon with this happening, you just brace yourself, another mass shooting in America. I believe the 11th in -- there since 2004.
What are you learning?
OMAR JIMENEZ, CNN CORRESPONDENT: That's right. The lieutenant governor telling us this is the 11th mass shooting that happened here in Wisconsin since 2004. And as far as this investigation goes, what they're really trying to hone in on right now is why this happened.
Now, we do -- or, I should say, police haven't officially released the name of the shooter just yet, but we do know that police have been in and out of a house here in the nearby area that we've been continuing to monitor as well. And when you talk about the profile of this person, they say he was a 51-year-old employee at Molson Coors here, and the five people that were killed also employees here at the complex.
SCIUTTO: So no word yet on the weapon used here.
JIMENEZ: That's right.
SCIUTTO: What else are police saying about the degree of damage and so on, could it have been worse? JIMENEZ: That's right, Jim, we tried to actually pin police down on
the exact type of weapon that was used when they first got in front of the press last night. We're hoping to get some more of those details today. But as far as what they encountered when they first got to the scene, I mean police described it over dispatch as a war zone, as they tried to prioritize some of these casualty situations and try -- and also try to get other people to safety as quickly as possible.
Now, when they did get there, the gunman, they said, was already dead by an apparent self-inflicted wound, according to police. So that threat seemed to be eliminated.
But then began the process of trying to secure an office building, a complex, where more than a thousand people were working at the time of this shooting. So it was a difficult process. It took hours, even after this shooting unfolded until they finally gave us the all-clear that everyone had been accounted for.
HARLOW: Well, it's tragic and five families reeling from unimaginable loss that they didn't expect when their loved ones just went to work.
HARLOW: Thank you, Omar, for being there.
SCIUTTO: Five more American families.
SCIUTTO: The CDC is now looking into the possibility that a patient in California who tested positive for coronavirus is the first person in the U.S. to get it without traveling outside of the country or coming into contact with someone who did. Why that's important, coming up.