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American Morning: Wake Up Call
Asian Markets Tank After Dow's Bad Day; Afghan Blasts Kill 8 at U.K. Council; Bank Of America Slashing Jobs; Two Soldiers Charged In Teen's Death; U.S. Changing Deportation Policy
Aired August 19, 2011 - 05:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: Good morning to you. Happy Friday.
It's Friday! August 19th. This is your A.M. WAKE-UP CALL.
I'm Carol Costello. Thank you for joining us this morning. We're live from New York.
So, let's get started because the weekend has arrived in Hong Kong, Tokyo and Shanghai. Traders probably thought happy hour would never arrive. Asian markets took a beating today. The Nikkei, Hang Seng and Shanghai Composite all opened lower and things just kept going downhill from there. We'll take you to Hong Kong in a minute for more details on that.
Of course, you had to see this coming given what happened to the United States and Europe yesterday, the Dow fell 419 points. We've sped up the big board here, that arrow just refuses to turn green. The S&P lost more than 4 percent. The NASDAQ sank more than that to 5 percent. It sank 5 percent.
So, what has rattled the markets this time? Well, it's a combo platter of bad news, jobless claims are up, existing home sales are down, consumer prices are up and the manufacturing industry has gotten weaker.
No wonder a top economic adviser is flying up to Martha's Vineyard next week to help President Obama with his job proposal.
And then there was this report from Morgan Stanley, not painting a pretty picture for the United States or Europe. So, brace yourself. You're about to hear the R-word again.
Here's our chief business correspondent, Ali Velshi.
(BEGIN VIDEO CLIP)
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: It said things we had all sort of thought, but now it was on paper.
Number one, it said we are dangerously close to a recession. Dangerously close. It doesn't say it's entirely likely. It doesn't even say it's their base assumption, but dangerously close.
It also says that Europe and the U.S. have made policy errors, policy errors. That's the central banks and the political system. In fact, it referred specifically to the drama of the debt ceiling debate in the United States. That has sucked the confidence out of investors worldwide.
And number three, it says both the Fed and the European Central Bank may need to intervene again.
(END VIDEO CLIP)
COSTELLO: OK. May need to intervene again.
So, what the heck does that mean? How would it intervene?
Kristie Lu Stout, we believe you might have the answer.
KRISTIE LU STOUT, CNN INTERNATIONAL CORRESPONDENT: Well, Carol, I'm not coming across calls for more intervention outside the U.S. other than the usual appeals from China for more fiscal prudence. But even that is on hold given the delegate diplomacy surrounding Joe Biden's visit.
Now, China's vice president and heir apparent, Xi Jinping, endorsed the resilience of the U.S. economy today, saying this, quote, "We believe the U.S. economy will achieve even better development as it rises to challenges."
Now, those truly glowing words aside, there could be negative reaction and calls for more intervention on Monday. So, we'll be waiting for that -- Carol.
COSTELLO: OK. We're waiting, too, waiting with bated breath.
So, if you look into your crystal ball, how are the markets looking to close out the week?
STOUT: Well, it's not looking good. Global markets are in the red driven by fears of recession in the U.S. and a spreading debt crisis in Europe.
Now, European markets, they all opened lower. And right now, the London FTSE, the CAC 40, the DAX are all seeing losses between around 2 percent to 3.5 percent. So, that's probably going to continue this day.
Meanwhile here in Asia, the markets are basically shocked into some major losses. Both the Nikkei and the Hang Seng here in Hong Kong closed down about 2.5 percent. The Shanghai Composite closed down about 1 percent.
The worst performer in the region today, Carol, was the Seoul KOSPI with a loss of 6.4 percent. So, there's a lot of fear out there weighing down the global markets this day.
COSTELLO: We'll try to remain calm, though. That's what everyone says -- don't worry about it. It will be fine.
I hope so. Kristie Lu Stout live from Hong Kong -- thank you.
There is developing news to tell you about out of Afghanistan this morning. A pair of suicide bombers attacked a British government compound in the center of Kabul. At least eight were killed, 10 others hurt. Explosions and gunfire were heard hours after the attack. The Taliban claimed responsibility.
Today is the 92nd anniversary of Afghan independence from Great Britain.
The United Nations will send a humanitarian mission to Syria this weekend. They'll check out reports of violence and murder in President Bashar al Assad's crackdown on protesters and see if they amount to crimes against humanity.
President Obama has called for Assad to step down. Secretary of State Hillary Clinton delivered the message on camera.
(BEGIN VIDEO CLIP)
HILLARY CLINTON, SECRETARY OF STATE: The people of Syria deserve a government that respects their dignity, protects their rights and lives up to their aspirations. Assad is standing in their way. For the sake of the Syrian people, the time has come for him to step aside and leave this transition to the Syrians themselves. And that is what we will continue to work to achieve.
(END VIDEO CLIP)
COSTELLO: The administration has also frozen Syrian assets under U.S. jurisdiction, banned Americans from doing any business with Syria and also banned Syrian oil.
Congresswoman Michele Bachmann wants President Obama's job. So you don't expect her to lavish praise on him. She's now saying the president should have called for Assad to step down weeks ago and that Mr. Obama is leading from behind again. She also urged the president to kick Syria's ambassador out of the United States and bring the U.S. ambassador to Syria back home.
Bachmann, by the way, is in South Carolina today. Governor Rick Perry will be there, too.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Stop attacking middle class families, Rick Perry. Stop attacking middle class families, Rick Perry. Stop attacking middle class families --
(END VIDEO CLIP)
COSTELLO: Oh, it's the political year of the heckler, yes. Stop attacking middle class families you heard.
Rick Perry was being heckled. He was just trying to order a delicious pop-over. Rick Perry ran into those hecklers in New Hampshire. Some yelled at him to keep his hands off their Medicare. Others held signs that told him to, quote, "back off my Social Security." Perry has referred to Social Security as a Ponzi keep and a failure.
Our roller coaster economy has a lot of people talking about the people hurt the most, the poor. Jon Stewart says billionaire Warren Buffett took it to a whole new level.
(BEGIN VIDEO CLIPS)
JON STEWART, COMEDIAN: Bizarrely un-eccentric billionaire Warren Buffett entered the fray.
UNIDENTIFIED FEMALE: The billionaire says, "While most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks. My friends and I have been coddled long enough."
STEWART: Or, to put that another way --
UNIDENTIFIED MALE: Warren Buffett, class warfare.
STEWART: If there's one thing the rich have learned, it's that class warfare is hell.
UNIDENTIFIED FEMALE: He invoked the corporate jet class.
UNIDENTIFIED MALE: Soak the rich, it's their fault.
SEN. MARCO RUBIO (R), FLORIDA: It's disappointing. It's class warfare and it's the kind of language you would expect from a leader of a third world country.
STEWART: United States of America is not a third world country by any measure, except perhaps income inequality where we rank worse than the Ivory Coast, worse than -- 64th! Ahh! In your face, Uruguay, Jamaica and Uganda!
(END VIDEO CLIPS)
COSTELLO: Yes. The wage gap is really, really big in this country.
The world's largest computer banker is pulling the plug on its tablet and thinking about exiting the personal computer business altogether. What's behind that move? That's coming up.
But, first, it's time for our quote of the morning. And here it is. Here's the quote, "He's very, very tone deaf."
I'll give you a hint. It's a newsmaker referring to the timing of President Obama's Martha's Vineyard vacation. We'll have the answer for you in 90 seconds.
It's eight minutes past the hour.
(COMMERCIAL BREAK)
COSTELLO: It is nine minutes past the hour. This is your A.M. WAKE-UP CALL.
Let's get back to that quote, shall we? The quote is "He's very, very tone deaf." That was -- Sarah Palin, the former Republican vice presidential candidate and current FOX News contributor. She was asked about the timing of the president's vacation of course on FOX. And here's her answer.
(BEGIN VIDEO CLIP)
SARAH PALIN (R), FORMER ALASKA GOVERNOR: He's very, very tone deaf. I can't believe that he, after three days in the heartland, did not hear those things that I hear when I'm in the heartland and anywhere else across the U.S., and that is: come on, let's buckle down and let's be serious about getting the country back on the right track.
(END VIDEO CLIP)
COSTELLO: Sarah Palin is predicting President Obama may have to end his trip early to deal with the economy. Maybe, of course, all the Republicans and Democrats who serve in Congress could cut short their vacation, too.
Now, let's head to Atlanta for a man who's always on the job.
Rob Marciano, you are constantly working.
ROB MARCIANO, AMS METEOROLOGIST: And even when I'm not here, I'm thinking about work, dreaming about work, wanting to work.
COSTELLO: That's sad. That's so sad.
MARCIANO: I get to take a little vacation next week. That may be cut short because of work and what we're about to show you.
All right, Carol, some action in the Tropics. We've been talking about this wave moving across the western Caribbean now about to skim the coastline of Honduras and head towards Belize.
Tropical depression number eight, it could become a tropical storm in the next few hours. But other than that, doesn't have a whole lot of time to strengthen. So, that's the good news. It will stay south of the U.S.
Forecast is for it to become a tropical storm briefly and then make direct landfall in Belize as we get later tonight and into tomorrow. Tropical storm watches are up for that, and warnings may be issued later on.
Of more concern for the U.S. would be this little diddy out there in the central southern Atlantic. A good chance of this becoming a depression or tropical storm here in the next 48 hours and this one has a little bit more danger threat, even though it's out there over a week. We're going to watch it carefully as it makes its way towards the U.S. Gulf of Mexico and Southeast coastline will be under the gun with that one.
All right. Thunderstorms across the New York City area today. So travel delays there and in D.C. and also in Philadelphia and Boston. So, we may see some action here as far as some of the more populated areas going forward.
A couple of areas of concern and across the midsection, we've got a decent cluster of thunderstorms that's moving across Missouri right now. Here is what it looked like as far as damage goes across Omaha last night. This thunderstorm complex dumped a ton of hail across Omaha, Nebraska, almost three inches in diameter.
So, this did the damage just outside the airport there. They actually had to shut down the airport, Carol. Southwest Airlines pilot was injured. He was on the jet way or near the jet way when this hail storm hit. People were on the Southwest plane had to be deplaned. No word on what kind of damage that happened to two Southwest Airline planes that were on the tarmac at the time.
Those hailstones meant business. And that cluster moving just to the south of St. Louis and we'll show you a little more of that on the radar later this morning.
COSTELLO: Can you imagine returning from your trip, getting off the plane and going to your car and seeing that?
MARCIANO: Oh, yes. That will make you not want to go to work and get back on vacation.
COSTELLO: Exactly. Thank you, Rob. We'll get back to you.
MARCIANO: You bet.
COSTELLO: The world's largest P.C. manufacturer is looking to get out of the personal computer business. It's just one part of a radical restructuring plan by Hewlett Packard. The company has also killed off its TouchPad tablet launched just last month. Despite slashing prices, its tablet wasn't flying off the shelf, you know, like the iPad.
So, Hewlett-Packard is shifting its focus to more profitable businesses like software servers and corporate technology services.
Coming up next, a computer chip that acts just like our brains. IBM has come out with prototypes. The idea, computers that learn from experiences and come to their own conclusions. But could this be a bad thing? You know, like robots going rogue in the movies?
Well, IBM says technology like this could help monitor things like traffic lights and natural disasters, not take over the world.
OK. So, we know about the warnings we get before a plane departs. Now comes a warning before an in-flight movie that might make you cry. Really? Virgin Atlantic made the move after a survey showed 41 percent of men on their flights hid their tears under blankets during sad movies.
So, now, they're going to have a warning on the screen: this is a sad movie. Be prepared, if you don't want to watch, don't watch.
If you change the channel or turn off the television, you're going to miss the big news about Burger King. The company is now more burger, less king. His highness has been forced to abdicate his plain, broiled crown. The scary man is gone.
We'll be back.
(COMMERCIAL BREAK)
COSTELLO: Sixteen minutes past the hour. Time for a laugh.
President Obama's trip to the Midwest had comedian Stephen Colbert saying it's a jungle out there. And what about your bus, "bus force 1"?
Here is your punch line.
(BEGIN VIDEO CLIPS)
STEPHEN COLBERT, COMEDIAN: "Bus force 1" over here isn't even American. It was made in Quebec. It's a Canadian hybrid. It runs on gas and beaver meat.
Obama bag on his safari through the Midwest.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Hey, how are you? I got a pie.
(CHEERS AND APPLAUSE)
COLBERT: He got a pie. Come on, Obama. At least throw it at a puma.
In tough times, we Americans want a president who is a bad ass. If it's not you, it's going to be Rick Perry.
(END VIDEO CLIP)
COSTELLO: He just makes me laugh.
Oh, that perfectly sets up our Political Ticker with Tim Farley, host of "Morning Briefing" on Sirius POTUS live from Washington.
Hello, Tim.
TIM FARLEY, SIRIUS XM POTUS: Good morning. How are you?
COSTELLO: I'm good.
Before we start up, let's slap up a few postcards that were released by the Republican National Committee. They're kind of poking fun at President Obama taking vacation because he's taking a lot of heat for that. So, they made up these fake postcards showing President Obama, you know, having fun in Martha's Vineyard.
We'll get them up there in a minute.
But President Obama is certainly aware of the criticism he's facing for taking his vacation at this particular time.
FARLEY: Sure. Bill Clinton did this all the time. He took, I think, six of eight vacations at Martha's Vineyard. It's not so much that he's on vacation. It's just the fact that he's at Martha's Vineyard.
As Josh Earnest, who is the chief deputy press secretary told reporters yesterday, the president of the United States is the president wherever he goes. John Brennan, his counterterrorism adviser was with him yesterday as he went to Martha's Vineyard. He's not out of the touch.
I think, ultimately, there are two things that are going to be more important. Number one, does anything happen while the president is there? Because if it does and then he gets back to Washington, no harm, no foul.
More important when he comes back to Washington in September when he gives us the speech on jobs, that's what people will be paying attention to.
And I will go to something that Nelson Sigelman, who's the Martha's Vineyard "Times" chief editor, told me yesterday, if the president gets a picture of fishing with the daughters, then probably no one will give him any guff because there's no problem with a dad and his kids on vacation.
COSTELLO: Oh, I don't know. In this political climate, there may be.
FARLEY: Maybe.
COSTELLO: Let's talk about another ad out there causing a bit of controversy. I would have thought this kind of thing would be put out by Larry Flynt, but oh, no. Tell us about it.
FARLEY: This is one of the Ron Paul supporters who is evidently concerned about Rick Perry and decided that if somebody can come forth with information about Rick Perry's dalliances, which nobody has made accusations of, they'll come up with some money.
It's funny you should mention Larry Flynt. Those of us who recalled that he had offered a bounty on people who could find somebody who had been hypocritical about their past. But those ads that are being run right now, "Have you ever had sex with Rick Perry?" Ooh, that's a little bit much. We'll see how that goes.
This is sort of internecine fighting in the Republican Party and we'll see how well it plays on the campaign trail -- just another sign of the ugly times I guess when it comes to politics, Carol.
COSTELLO: Really ugly. They're reaching out to strippers across America -- have you ever had sex with Rick Perry? There's absolutely no evidence that Rick Perry has ever strayed from his marriage, or have sex with a stripper. But you're right. It's ugly, ugly political climate.
Tim, thank you so much. We enjoyed it as always.
FARLEY: I'm going to think about my job all weekend, like Rob, I'm starting a theme here.
COSTELLO: Oh, that's so depressing. I'm not. As soon as I'm off work, I'm out of here, mentally and physically.
Tim Farley, host of "Morning Briefing" on Sirius XM POTUS, thanks for joining us.
How can you call yourself Burger King when you've sacked your king? Burger King will try.
The number two burger chain is changing things up a bit -- changing things up a bit, rather. One of the changes, they're getting rid of the king character. The company wants more people to come in the door and that means kicking his highness to the curb. He was a little weird anyway. And he might have scared children a bit. I'd say yes.
They're meant to protect soldier's most delicate parts, boxers or cups? Which do soldiers prefer? This morning, the reviews are in.
But, first, whether you like it baked, fried or mashed, or however you like it, be sure to fill up on potatoes today because it's National Potato Day.
It's 21 minutes past the hour.
(COMMERCIAL BREAK)
COSTELLO: It's 24 minutes past the hour.
We're following developing news out of Kabul, Afghanistan. A pair of suicide bombers attacked the British council there, killing at least eight people.
So, let's head round the world with Zain Verjee. She's live in London.
What more can you tell us about this attack?
ZAIN VERJEE, CNN INTERNATIONAL ANCHOR: This really underlines, Carol, the fact that the Taliban are showing that they can strike anywhere. This is a very rare thing to happen, an attack in the capital of Kabul. It was at the British embassy compound, targeting specifically the British council offices. At least eight people have been killed, all of them we understand to be Afghan security forces.
Basically what happened, there was a suicide car bomb. It exploded. A compound wall came down. The insurgents went through and there was sporadic gunfire and fighting for a long time between security forces and those militants.
This is also significant, Carol, too, because this is actually a day which is the anniversary of Afghanistan's independence from the U.K. back in 1919.
And the other thing, too, to keep in mind here, security in the capital was really stepped up before this date, and the night before. What it shows is militants can smuggle in weapons, suicide vests, and attack a British embassy compound in spite of the stepped up security.
So, it raises questions about the competency of Afghan security forces -- Carol.
COSTELLO: Yes. And, of course, that complicates things as far as U.S. troops leaving Afghanistan as well.
VERJEE: Right.
COSTELLO: Zain Verjee, live in London -- thanks so much.
A bench-clearing brawl in China is making headlines this morning. It happened during the fourth quarter of an exhibition game between the Georgetown men's basketball team and a team from China. As you can there, things quickly got out of hand. Ooh, it's getting worse now. Georgetown's head coach called the incident unfortunate.
We're going to get a live update about this brawl from Beijing. That's coming up in a bit.
They're meant to protect soldier's most delicate body parts. This morning, the Army says initial testing of the so-called ballistic boxers has gone well. The heavy silk boxers won't stop bullets or shrapnel from an IED, but they apparently can stop small projectiles.
The Army is also testing ballistic cups. The stainless steel cups are getting reviews. Soldiers report they're not as comfortable as those silk boxers.
Searching for jobs in a sluggish economy. Thousands line up for hours outside an Atlanta job fair. Why even some had to be rushed to the hospital.
(COMMERCIAL BREAK)
COSTELLO: Good morning. Happy Friday. It is August 19th. This is your A.M. WAKE-UP CALL. I'm Carol Costello joining you live from New York. It is 30 minutes past the hour.
The weekend has already arrived in Hong Kong, Tokyo, and Shanghai. Traders probably thought it couldn't get here fast enough. Asian markets took a beating all day. The Nikkei, Hang Seng, and Shanghai Composite all opened lower and things kept going downhill. You had to see this coming given the Dow's 419-point drop on Thursday.
Why are we still talking about tanking stock markets? What's the problem? Here's what the former bailout chief in the Bush administration told CNN's Piers Morgan.
(BEGIN VIDEO CLIP)
NEEL KASHKARI, PMCO: For two years we've tried a number of short-term estimative measures to try and get our economy growing again. The markets have now figured out that those have not lead to long-term economic growth. So, people are scared. When people are scared, they save more, they spend less, corporations invest less. They retrench.
And then, that can become a self-fulfilling prophesy. So, what's happening in Washington is making a bad situation much worse because it's hurting confidence, and that could tip us into recession.
(END VIDEO CLIP)
COSTELLO: You already knew that, though, right? Speaking of the R word, Morgan Stanley says both the United States and Europe were, quote, "hovering dangerously close to a recession," end quote. Just how tough is it to find a job in this economy? Just ask the people who stood in line for hours in Atlanta. Make that hotlanta because more than one job seeker suffered heat-related illness. They collapsed while standing in line.
Thousands of people stood there with their cover letters and their resumes in hand waiting to get inside a job fair sponsored by the Congressional black caucus. Ninety employers, all of them with job opening, stag (ph) busy too. For those unemployed, it's a rough market, though.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: You're on the web. You're sitting in front of the computer four, five hours trying to find out, you know, the jobs that are available.
UNIDENTIFIED FEMALE: It's after like a month or so, you start to feel like, you know, is there any hope? Is anybody even looking at your, you know, profile online because there's not many responses that you get back.
UNIDENTIFIED FEMALE: It's my job to get a job. I'm going to get one. I'm going to find one.
(END VIDEO CLIP)
COSTELLO: That's the spirit.
In the meantime, the nation's largest bank is axing more than 3,000 jobs. Bank of America is going through a restructuring that could see thousands more jobs eliminated. The company has witnessed its shares drop 47 percent this year. Also this morning, two Ft. Bragg soldiers are facing murder charges in the death of a North Carolina teenager, both men, both 20, also face charges of disposing a body. A local sheriff says the 17- year-old victim was found in the woods yesterday. He'd been missing for several days. He had just started his senior year of high school. No word on a motive.
The Department of Homeland Security is changing its approach to the way it handles pending deportation cases. DHS secretary, Janet Napolitano, says her department will soon begin reviewing all 300,000 cases to determine which individuals meet specific criteria for removal. She says the ultimate goal is to have enforcement resources diverted from illegal immigrants who don't have criminal records to individuals who pose a threat to public safety and national security.
She says the new policy change won't negate reforming immigration laws. In other words, people with criminal records will be more likely to be deported, you know, over those with no criminal background.
Time now for something to make you laugh. Hey, S&P, you downgrade the U.S. credit rating. Well, comedian, Jon Stewart's, got something to say to you.
(BEGIN VIDEOTAPE)
JON STEWART, HOST, THE DAILY SHOW WITH JON STEWART: Guess what, S&P, pay back is a (EXPLETIVE DELETED).
UNIDENTIFIED FEMALE: The justice department has reportedly launched a probe into whether Standard & Poor's credit ratings agency improperly rated mortgage securities.
STEWART: What?
(LAUGHTER)
STEWART: Was that S&P? Tell me how (EXPLETIVE DELETED) case.
(LAUGHTER)
STEWART: You mess with us, we mess with you. Your meat (ph) and my meat (ph), I mean, we've launched a probe and you may be subject to several depositions by government officials, plus interviews by investigators that in some cases could lead to fines.
(LAUGHTER)
STEWART: Obviously, it's a negotiation in many respects. The point is, there's a strong chance your name will end up in a scathing editorial on page A-17 of "The New York Times." Sorry S&P, but revenge is a dish best served slow and with a great deal of bureaucratic paperwork.
(LAUGHTER)
(END VIDEOTAPE)
COSTELLO: Hundreds of Verizon workers take their strike to the front door of the home of their CEO. Still ahead, the impact of the nearly two-week-old strike is starting to hit Verizon where it hurts the most.
But first, our businessman's special of the day. What billionaire claims he's looking to build his own floating nation state in hopes of avoiding things like voter -- voter of disappointment, minimum wage, and restriction on weapons? I hope you got that, because I didn't say that very well, and I apologize. Anyway, it's 35 minutes past the hour.
(COMMERCIAL BREAK)
COSTELLO: Thirty-six minutes past the hour. In the businessman's special of the day, we asked you what billionaire claims he's looking to build his own floating nation state in the hopes of avoiding things like voter disenfranchisement, minimum wage and few restrictions on weapon. It's Peter Thiel, the co-founder of PayPal.
The 43-year-old libertarian has already pledged more than a million dollars to the sea-setting institute which is looking to establish sovereign nations on movable platforms in international waters. So, soon there'll be little floating countries all over the place out in the water. Who knows? Isn't that bizarre, Christine?
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: That's a lot of money. You've got a lot of money, Carol.
(LAUGHTER)
COSTELLO: He certainly does. Let's talk about the folks without a lot of money, you know, those unemployed, those looking for a job and those fearing -- we keep hearing there's going to be a double-dip recession. So, is there any silver lining this morning?
ROMANS: Well, silver lining is for many people today is a payday, Carol. So, if it's a payday and you're putting money into your 401(k), the stocks you're buying this week are cheaper than they were last week. Maybe, that's called comfort in the stretch, but look, that is one of the sad silver linings of a declining market is that you're picking up shares cheaply if you are automatically investing in your 401(k) and you have a long-term horizon.
So, there you go, but it's not really good if you really do get a double-dip recession in the country or in the world, and, then, stocks keep going lower. But still talking about the fears of recession, Carol, could it happen? What's the likelihood? And just all that talk is enough to keep this negative feedback loop continuing. There just isn't confidence, and that continues this morning. We've got futures sharply lower again, Carol.
COSTELLO: OK. We'll stop talking about that now, then.
It looks like Verizon workers -- let's talk about Verizon, 45,000 workers are on strike. And they picked -- I guess, it's a traditional way to get their message across, really.
ROMANS: Sure. Go to your boss's house and stand there with a flag and all of your friends in your red shirts organized by your union and say things like "stop the greedy pigs." Look, they're arguing about cuts to benefits. Verizon says even with the concessions that they're asking for, that these workers would still have toward the higher end of comparable companies on their benefits and retirement and health care.
But these people say, no. This is Verizon being greedy and trying to drive down our middle class lifestyle for hard work that we do. So, it's the classic union manager fight playing out at the guy's front house -- at his front doorstep. So, there you go. And you know, as I reported yesterday, Verizon said that by August 31st, if these people don't come back to work, they're going to have to go on COBRA. They're going to lose their benefits overall.
COSTELLO: We'll seep what happens. Christine Romans, I'll see you in just a bit.
ROMANS: Sure.
COSTELLO: Coming up in a few minutes, we've got some serious irony for you. a good will game that ended with players clearing the benches and punching each other out.
But first, it's time to "Get Smart." How many passenger vehicles are now cruising the planet? Is it A. 500 million, B. 700 million, or C. 1 billion? You have two minutes to think about this. It's 39 minutes past the hour.
(COMMERCIAL BREAK)
COSTELLO: It's 41 minutes past the hour. This is your A.M. WAKE-UP CALL.
So, how many passenger vehicles are now cruising the planet? The answer? Well, it's 500 -- gosh, you gave it away too quickly. The answer is C, one billion. This is according to an industry trade journal. It's something to think about the next time you're stuck in gridlock on your morning commute, although, you already know that.
Now time for our "Political Ticker." Let's bring in our deputy Political director, Paul Steinhauser. He's live on the phone from Washington. So, Paul, republican candidates will have ten days to go after President Obama while he's vacationing on Martha's Vineyard. So, can we expect a bit of nastiness?
PAUL STEINHAUSER, CNN DEPUTY POLITICAL DIRECTOR: They didn't even wait for him to go. He left yesterday. At the beginning of the week, some of the candidates already went after him including Mitt Romney who's, you know, the perceived frontrunner in the race for the Republicans nomination. Here is what he said on the campaign trail in Massachusetts. Take a listen.
(BEGIN VIDEO CLIP) MITT ROMNEY, (R) PRESIDENTIAL CANDIDATE: The president this week is in three states on a bus tour campaigning. Then, he's going to be going on a vacation to Martha's Vineyard for ten days. A lot of Democrats in Martha's Vineyard. I don't know why.
(LAUGHTER)
ROMNEY: But I wish the president were in Washington calling back Congress and dealing with the challenges we have.
(END VIDEO CLIP)
STEINHAUSER: Two things about that one, Carol. First of all, remember, Mitt Romney was governor of Massachusetts. Martha's Vineyard is in Massachusetts. (INAUDIBLE). He was referring to Bill Clinton, because when Clinton was president, a Democrat, of course, he spent some vacations in Martha's Vineyard.
And finally, guess where Mitt Romney is going to be doing a week from now? He's going to be fundraising, creating campaign cash for his campaign in Martha's Vineyard. So, he's a Republican presidential candidate, Carol. That's what they do. They're supposed to be criticizing the president. That is their job, Carol.
COSTELLO: Well, I dare say some Americans are criticizing the president, too, for going on vacation because the economy is in poor shape.
STEINHAUSER: Oh, yes.
COSTELLO: But President Obama is aware of that, and he's bringing a couple people with him, right?
STEINHAUSER: Oh, yes. They're always working vacations. He's going to have the family there, but he's also going to be working on the big job speech right after Labor Day. So, he's going to have advisors up there. He's going to be working on that. But Carol, let me just say two things here real quick. Listen, presidents get criticized for taking these kind of vacations.
Remember, George W. Bush. Everybody said he was spending too much time in Crawford, Texas in the summer. Why don't you back (ph) in Washington. And the other thing I will tell you is the president's approval rating is pretty low right now, but guess who's a lot worse? Congress.
And there's a lot of calls for Americans that say not only for the president to be back here in D.C. working, but also Congress. Everybody should be back here, Americans feel, working and fixing the economy and trying to get jobs created, Carol.
COSTELLO: Paul Steinhauser, thanks as always. We appreciate it.
STEINHAUSER: Thanks, Carol.
COSTELLO: Here are three things to put on your radar today. We're just a few hours away from the opening bell. Traders are bracing for another rough day on Wall Street. Just yesterday, the Dow fell 419 points.
We're watching to see what happens next in the case of a father and son charged with making violent threats against Sarah Palin, her family, and her lawyer.
And the West Memphis three could be freed as early as today. The three men were convicted back in 1993 of killing three second grade boys. All along, they claimed their innocence. DNA tests did not link them to the crime.
You've probably seen a fight break out at a basketball game before. Sure it happens. But, this one is a little different. First of all, it was a game between the Georgetown Hoyas and a Chinese military team. It coincides with Vice President Biden's official visit to China. And secondly, and here's some irony for you, this was a goodwill game. Maybe, there's some goodwill in there underneath all those flying fists and black eye.
CNN's Jamie Florcruz is in Beijing. Oh, Jamie, this is a sad. I don't know. it's a sad spectacle for a goodwill game.
JAMIE FLORCRUZ, CNN INTERNATIONAL CORRESPONDENT: It was. It was just supposed to be a goodwill game, and it turned very ugly, an ugly brawl, and that happened Thursday night when the Hoyas played the Chinese military team, which is one of the professional teams in town. They were playing a very physical game, lots of fouls, and with so many -- with about ten minutes left, they were still tied at 64-all when the players started to exchange blows, fist fights, the benches cleared and, of course, the game had to be abruptly stopped.
It happened when just days when Vice President Joe Biden is visiting china. No direct relations or connections. In fact, a day earlier, Vice President Biden watched another game of the Hoyas playing another Chinese team. But this one, the one on Thursday, ended not on a very friendly note, Carol.
COSTELLO: Oh, Jaime, this is just terrible. So, how -- like, with Chinese people watching this game, how would they think about this?
FLORCRUZ: Well, the mainstream Chinese media, very few of them reported this brawl. But on the internet, many Chinese internet users were -- posted very heated comments. One of them said that, well, the Chinese players showed hot temper, but not so hot basketball skills, Carol.
COSTELLO: Jaime Florcruz, thank you so much, joining us live from Beijing this morning.
Before we go, on this day in history, in 1909, the first race was held at the Indianapolis motor speedway. It's now home to the world famous racing competition, the Indy 500. It's 47 minutes past the hour.
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COSTELLO: Fifty minutes past the hour. Developing news out of Afghanistan this morning. The Taliban claiming responsibility for two explosions that rocked the British council in downtown Kabul, killing at least eight people. Explosions continued for hours after the attack. Our David Ariosto was there.
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DAVID ARIOSTO, CNN INTERNATIONAL CORRESPONDENT: A vehicle drove up, detonated, and then, militants effectively were able to enter in -- major, major explosions going on right now. We just heard a major blast behind us here. There seems to be smoke billowing out here, gunfire from what we can tell. ISAF security sources have basically surrounded this area here. Major, major smoke billowing out of the council area there.
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COSTELLO: Pretty frightening stuff. Let's go around the world. David Ariosto is joining us now live from Kabul. David, Kabul is heavy secured. This is quite unusual for these kinds of attacks to take place there, right?
ARIOSTO: Well, it just kind of goes to show that there really are no frontlines here in this war in Afghanistan. What we've seen lately is a string of high-profile attacks targeting either allies of the Karzai administration or western target. Back in June, we saw the targeting of the Intercontinental Hotel back here, right here, in Kabul not too far from where this took place.
And so, you know, you're saying as NATO troops are beginning to drawdown and this transition period is taking place, the effect of the surge, perhaps, has moved some of these Taliban forces away from the traditional heartlands in the south and east, but they're lashing back. And we've seen a resurgence of attacks over the last couple of weeks and months.
Just earlier, we saw an attack on the compound of the government (INAUDIBLE) province, a similar style attacks that seems to be the tactic in which militants, suicide bombers drive up in a vehicle, detonate in front of a main security gate and then other militants attack. So, again, the latest in a series of high-profile attacks -- Carol.
COSTELLO: David Ariosto reporting live from Kabul, many thanks.
Asia has felt the ripple from the Dow's lousy day. The Nikkei, Hang Seng, and Shanghai Composite all opened lower today. And things just kept going downhill from there. Of course, you had to see this coming given what happened in the United States yesterday.
The Dow fell 419 points, and Morgan Stanley said both the United States and Europe are dangerously close to another recession. So, we can hope the U.S. markets recover today, but experts say this is a really nervous time on Wall Street. (BEGIN VIDEO CLIP)
LEIGH GALLAGHER, ASSISTANT MANAGING EDITOR, FORTUNE: You can't underestimate enough how much the market is so skittish right now. It's august. Volume is low. And that means the market can swing wildly one way or another with not even too much movement. You know, the market can go down if it's going to rain tomorrow or if there aren't enough sales to the U.S. open ticket. I mean, it's really that sensitive right now.
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COSTELLO: Sign of the tough economic times could be felt outside of Atlanta. Thousands of people stood in long lines for hours for a chance at getting hired at a job fair. Ninety employers were looking to hire -- only 90 of them were looking to hire workers. The Congressional black caucus sponsored the job fair.
The world's largest PC manufacturer is looking to get out of the personal computer business, just one part of a radical structuring plan by Hewlett Packard. The company has also killed off its touch pad tablet. It's launched that just last month. Despite slashing prizes, its tablet just wasn't flying off the shelves like, say, the iPad. So, Hewlett Packard is shifting its focus to more profitable businesses like software, servers, and corporate technology services.
Let's head to Atlanta, because he's got the finest computers available in the entire universe.
ROB MARCIANO, AMS METEOROLOGIST: Yes. Yes, we do.
COSTELLO: So, are they showing any flight delays?
MARCIANO: Not yet, but we'll probably see a few. There's going to be some pop-up thunderstorms in more populated areas. So, that will affect some travel for sure. Let's get to the boards and show you a couple things. First off, the tropics. We've got this tropical depression number eight which is heading towards Honduras. And as it does so, we're looking at the potential for seeing some flooding in this area.
And the other issue that we're seeing beyond this is what's happening further out in the Atlantic, and that may get into or close to the Caribbean by the time the end of next week comes. So, that is of more concern to the U.S., but what's going on here in Belize will be some rainfall that could spawn some mudslides. As far as the spots where you'll see some thunderstorms that will pop up and create delays, that would be -- we're still on this tropic stuff. Sorry.
The best computers in the world, Carol, are moving pretty slow right now, OK? The kiss of death, thanks for doing that for me. I can't believe you.
COSTELLO: I'm sorry. I jinxed your computers.
MARCIANO: That was operator error. I forgot to put it in play. (LAUGHTER)
COSTELLO: We thank you, anyway. We got our info.
MARCIANO: See you on "American Morning."
COSTELLO: Rob Marciano live from Atlanta. We'll be back right after this.
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COSTELLO: Fifty-eight minutes past the hour. Now, let's go to our Carter Evans for a look at your money this morning. I know you have to do this, Carter, even though we probably don't want to hear it, but go for it.
CARTER EVANS, CNN BUSINESS CORRESPONDENT: It's tough. Let's start with the good news. It's Friday. Now to the rest of the news, which is unfortunately not so good. I mean, let's take a look at the futures right now. We're looking at another down day. The Dow down 167 currently. The NASDAQ down 24. The S&P 500 down about 16 points on the CNNMoney.com. Pre-market page, we've got no real big reports. No real earnings coming out today.
So, investors are going to have to find their way on their own. Here's a preview of how things are going in Europe right now. Check this out. The FTSE in London down another 2.7 percent after falling about four percent yesterday. The Dax in Germany down 3.3 percent, 3.4, after falling almost six percent yesterday. So, where is everybody going? Carol, they're headed -- yes.
COSTELLO: Yes.
EVANS: You know that, right?
COSTELLO: I know.
EVANS: Gold.
COSTELLO: I'm just wondering why I pay attention to this every day when there's nothing I can do about it.
EVANS: Well, there really isn't a whole lot you can do about it, but if you feel good spending money, you could spend a little money. That is what could help out the economy right now if everybody did a little of that instead of pouring all their money into gold which is where they're going. Check this out today. These are gold futures. You know, I was going to show you the record there, 1,830. This is 1,865 an ounce this morning. Yes, up another 2.5 percent.
COSTELLO: Crazy. Carter Evans, thank you, and you're right, it's Friday.
(LAUGHTER)
COSTELLO: "AMERICAN MORNING" continues right now.
