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At This Hour
Stocks Slide In Early Trade On Global Banking Fears; China Denies Asking TikTok For Foreign Users' Data After CEO Grilled; Gwyneth Paltrow May Testify Today In Utah Trial. Aired 11:30a-12p ET
Aired March 24, 2023 - 11:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MATT EGAN, CNN REPORTER: They're down pretty sharply, almost 11 percent. Some of these concerns have been triggered by a spike in the cost to ensure Deutsche Bank's debt. That is never a good sign.
I would note though, that Deutsche Bank has been in turmoil for years. This is not entirely new. But the bank failures in the United States really forced investors around the world to take a tougher look at banks. And as you can see of regional banks in the U.S., they're kind of mixed right now.
First Republic is the one that's getting the most attention, down another 2 percent. It's lost something like 90 percent of its value over the past month. It's been incredible.
Now, on the Deutsche Bank front, European officials were quick to come out today and sort of say, look, there's nothing to see here. The chairman of -- the Chancellor of Germany said there's "no reason to be concerned about Deutsche Bank." U.S. officials, they're obviously watching this whole situation closely.
Treasury Secretary Janet Yellen, she is scheduled to convene a closed- door meeting of America's top financial regulators today. And that meeting includes the head of the FDIC, the SEC, and the Chairman of the Federal Reserve, and you got to believe that this is going to be one of the things they talk about.
KATE BOLDUAN, CNN ANCHOR: Yes. And then, of course, then you begin to wonder like, will they need to do more than just offer reassuring words to try to instill continued confidence in the banking system? We shall see on that. But also on the other news that we must and always continue to follow here, which is stubborn inflation. You had a chance to recently speak to a Fed official -- a top Fed official about the latest interest rate hike. What did you hear?
EGAN: Kate, you know, this was a pretty tough decision whether or not to raise interest rates. A lot of experts wanted the Fed to pause because of this banking crisis after the Fed unanimously decided to raise interest rates. Moody's chief economist Mark Zandi, he said he's you know "disappointed in the Fed" and kind of warned that it could backfire.
So, I asked the Richmond Fed President, Tom Barkin about why they ended up going ahead in raising interest rates. And he said, "the case for raising was pretty clear. The labor market is tight. Historically tight. Inflation, unfortunately, has stayed too high.
And you know, I asked Barkin about this criticism from politicians, including Senator Elizabeth Warren, who were saying, you know, the Fed is basically trying to get people laid off from their job. And he said that -- you know when he goes out and talks to people in his district, that the one thing he hears again and again, is that people "hate inflation." And he said, you know, people want us to get inflation back under control. And he said that we're the guys who were charged with doing that.
So, Kate, clearly, the Fed is still thinking that inflation is public enemy number one. But there are some risks to that. And one of the risks here is the situation that we're seeing in the banking system.
BOLDUAN: Yes, so interesting and so complicated and intertwined. Thank you, Matt.
Actress Gwyneth Paltrow could take the stand today testifying about a skiing accident that she was involved in. This is the culmination of a years-long legal battle. That's next.
BOLDUAN: Let's turn to Utah now. The state is cracking down on how kids use social media. The governor just signed first-of-its-kind legislation that bans anyone under 18 from using social media without their parent's permission.
Now, the law which goes into effect next March also bans all advertising to minors, imposes a nighttime curfew, making the sites off limits from 10:30 p.m. to 6:30 a.m. And the new law will give parents access to their teen's accounts. Social media companies are expected to challenge these bold moves in court, but Utah's governor says that he's confident the state will prevail.
Meanwhile, China is calling efforts to ban TikTok in the United States part of a "xenophobic witch hunt." China also denies asking Chinese companies to share foreign users' data. The remarks come after the hours-long grilling that TikTok CEO received yesterday on Capitol Hill. Appearing before lawmakers, he tried to assure that the platform protects Americans' data.
(BEGIN VIDEO CLIP)
SHOU CHEW, CEO, TIKTOK: ByteDance is not owned or controlled by the Chinese government. There are more than 150 million Americans who love our platform. And we know we have a responsibility to protect them.
(END VIDEO CLIP)
BOLDUAN: That testimony did little to sway lawmakers or the Biden administration. (BEGIN VIDEO CLIP)
JOHN KIRBY, NATIONAL SECURITY COUNCIL SPOKESMAN: His testimony didn't change our view one way or the other, Poppy, that there are real national security challenges with respect to that application. That's why the president has banned it from government devices. We have concerns over data. We have concerns over privacy. We have concerns over information sharing and the flow of that information back to Beijing.
(END VIDEO CLIP)
BOLDUAN: All right. Joining me right now, CNN political and national security analyst David Sanger. He's also a Whitehouse and national security correspondent for The New York Times. David, from your reporting, it all comes down to, as you hear from John Kirby, and you hear from anyone, for the administration all comes to net -- really, first and foremost national security concerns. How real do U.S. Intel sources think the national security threat is when it comes to China and TikTok?
DAVID SANGER, CNN POLITICAL & NATIONAL SECURITY ANALYST: Well, they think it's real because TikTok, Kate, is part of a broad number of apps that come out of China that once they're in your phone, you're never entirely sure what it is that they are doing. But they need a couple of things, I think to make this all come together.
First, they need to release the intelligence that gets past the issue that no one could really resolve in the hearing yesterday, which is, what is the influence of ByteDance, members of the Communist Party, leadership in Beijing, their ability to get in at the data. They spent a lot of time on where the data was located but that doesn't tell you very much about who's got access to it.
And then the second and bigger issue, Kate, is who is writing the algorithms that go into the software? Because at the end of the day, changing ownership and all that doesn't make that big a difference if you can't make sure that you understand the integrity of the algorithm that is the heart of that software.
BOLDUAN: That's a great point. And this pressure on TikTok from the White House and Capitol Hill, it, of course, is happening at the same time that you have conflict over the spy balloon --
BOLDUAN: -- and China and Russia renewing, you know, ties and strengthening ties with regard to Russia's war in Ukraine. How does this TikTok element impact the bigger picture do you think, David?
SANGER: Well, Kate, you know, for years, we've been saying that there is a new cold war brewing. Now, in the past couple of weeks, we have just begun to see the outlines of it hardening where you see Russia and China coming together in a way they never did in the old Cold War. It's actually quite different from the old Cold War.
And then we have a variety of surveillance concerns by China. The balloon was the one that got the most headlines and most attention and probably is the least important because they can pick a lot of that data up from satellite. TikTok and apps like it, that's a bigger issue, less for surveillance in my mind, then the question of what kind of data manipulation can take place once it's in your phone, what kind of movement of disinformation can happen once it's in your phone, so, these are the issues that we're going to have to work our way through.
There's a second set of issues that got all intermingled in this during the hearing, and that was the effect on children, teens --
SANGER: -- that's what that report that you just did was. And that's a separate important issue to parents, but it's not really a national security issue.
BOLDUAN: So, on that, about the possible ban or restrictions on -- being imposed on TikTok in the United States. You quote in your piece. It was kind of leading up to this. You quote Commerce Secretary Gina Raimondo in your piece, and the quote stuck out to me in the candor of what the Commerce Secretary said. And she said the politician in me thinks that you're going to literally lose every voter under 35 forever, which gets to an important question all this which is what are you hearing from the White House or around the White House about the politics at play here when it -- when we're talking about taking on or potentially banning or restricting a social media platform that is so popular?
I think we just lost the connection to David Sanger, unfortunately. All right, we will follow up with that very soon.
Still ahead for us. March Madness continues to live up to its name. The highlights from the sweet 16. Next. But first, a quick programming note in the new CNN Original Series, Searching For Mexico. Actress and producer Eva Longoria takes you on a journey across the country to see how the people, the culture, landscape, and history have shaped Mexico's diverse cuisine. Here's a preview.
EVA LONGORIA, AMERICAN ACTRESS: I don't know the secret to happiness. All I know is every time I eat Mexican food, I'm happy. I'm Eva Longoria born and bred in Texas with Mexican American roots. I'm going to get a T-shirt that says -- (speaking in a foreign language)
I'm exploring Mexico to see how the people, their lands, and their past have shaped a culinary tradition as diverse as 32 states. We're here. Today, we are going to be making our food pilgrimage.
Look at that. I don't know if I've ever been this excited to eat anything. (Speaking in a foreign language).
UNIDENTIFIED MALE: (Speaking in a foreign language)
LONGORIA: I was going to do this. That's why.
UNIDENTIFIED MALE: (Speaking in a foreign language)
LONGORIA: The people here are so secure in who they are and where they come from. (Speaking in a foreign language) You guys are amazing storytellers.
UNIDENTIFIED MALE: Appreciate it.
LONGORIA: Mexico is going through a major makeover to emerge as one of the world's greatest food destinations.
UNIDENTIFIED MALE: Do you know what brings people to Mexico? The food culture. I fell in love with it.
ANNOUNCER: Eva Longoria: Searching For Mexico, premieres Sunday at 10 on CNN.
BOLDUAN: All right, happening right now. You're seeing some pictures -- live pictures just in of President Biden arriving on Parliament Hill in Ottawa, Canada. The president is there, of course, as we've been discussing, to meet with Prime Minister Justin Trudeau, as well as other officials. There's going to be a ceremonial -- he's going to do a ceremonial guest book signing, meeting with top officials in Canada, and then they're going to go into their bilateral meeting, which reporters will hopefully get to catch the top of. And the president -- and President Biden's visit will wrap tonight with a steak dinner. We're going to bring you these moments and continue to as they happen throughout this afternoon.
Let's turn to this back here. Actress Gwyneth Paltrow, she could take the stand today in a lawsuit in a court battle, alleging that she crashed into another skier at a Utah resort back in 2016. Now, the Oscar winner, she walked into a Park City courthouse just moments ago. You see this. And the court is just kicking off for the day.
Let me bring in CNN's Chloe Melas. She's been following this story. This is a years-long legal battle, Chloe, but today seems to be quite a big day.
CHLOE MELAS, CNN ENTERTAINMENT REPORTER: Seven years in the making, Kate. And so, we've just learned that Gwyneth Paltrow who was maybe going to take the stand late this afternoon, if there was time was the exact language that we had been told. It looks like they have just moved the latest around the schedule and she will be testifying today. That's the plan. We don't know exactly when, but it's going to be really interesting to finally hear from Gwyneth herself.
So. you know, this accident taking place in Deer Valley, Utah, a very high-end ski resort where Gwyneth would frequently ski. In 2016, this collision happens but Gwyneth and her witnesses and she has maintained that she was downhill, and then a man, a retired optometrist named Terry Sanderson that he barreled into her. Now, Terry and his own witnesses claiming that not so fast, you know, I was downhill, she barreled into me. So, it's truly a, he said she said situation, Kate.
He is suing for $300,000. Originally, he was suing for $3.1 million. Unclear as to why he lowered that. Now, Gwyneth Paltrow countersuing for just a dollar on the principle that she wants to fight and see this through and clear her name and her side of the story.
Now, Terry Sanderson also expected to testify. One of his children, another daughter expected to take the stand as well. So, yes, all eyes on this, something that we've been talking about now for years.
BOLDUAN: Yes, it sure is. And is it expected -- can this -- could this dip into next week as well then?
MELAS: It definitely will. So, we are expecting this trial to last eight days. It started on Tuesday. So, we're expecting some sort of verdict towards the end of next week. And so far, we've heard from multiple experts and family members, but again, the two people which this centers around, Terry Sanderson and Gwyneth Paltrow, haven't heard from them yet but could be happening today.
BOLDUAN: All right, well, we'll keep a close eye on it. Chloe, thank you.
MELAS: Thank you.
BOLDUAN: Let's turn now to the roller coaster and wild ride of day one of the Sweet 16. Gonzaga survives a wild finish. And it's also Florida Atlantic University that is making history.
Andy Scholes is watching it all of -- all of it for us. He joins me now. Andy, it has been -- I mean, March Madness is living up to his name for sure.'
ANDY SCHOLES, CNN SPORTS ANCHOR: Oh, Kate, what a tournament. You know, what a start to the Sweet 16 we had last night. What a game we had in Las Vegas. You know, second half was certainly one wild ride. Gonzaga was actually down 13 at halftime to UCLA but they came all the way back, and actually had an eight-point lead with -- over UCLA with a minute to go.
But the Bruins would go on a frantic ten-to-one run capped off by Amari Bailey hitting a three to give them the lead with 13 seconds to go. Then, Mark Phew dialed up what he called the Jay Wright-play. The same one Villanova used to win the championship a few years ago. And Julian Strawther, the Vegas native, nailing it there to put them on top. UCLA had one last chance but they turn the ball over. Zags winning an absolute thriller 79 to 76.
(BEGIN VIDEO CLIP)
JULIAN STRAWTHER, GONZAGA GUARD: I mean, as soon as it came off, it looks like it was online and I mean --
DREW TIMME, GONZAGA GUARD: Butters in my ass.
STRAWTHER: I mean, my coach said we work on that play literally, you know in practice all the time. And I shoot it in practice and you all may be joking around sometimes but here we are, and it mattered today.
TIMME: I am the number one Julian Strawther fan in the planet. No one's a bigger fan of him than me, man.
(END VIDEO CLIP)
SCHOLES: All right. Now, Kansas State and Michigan State also playing a thriller at Madison Square Garden. And it was just a legendary performance from Wildcats' point guard Markquis Noel, the five foot eight Harlem native scoring 20 points to go along with an NCAA tournament record 19 assists. And no assists were bigger than this one right here to Keyontae Johnson in overtime for the reverse slam. And take another look at his play. Noel was actually going back and forth with Coach Jerome Tang right before throwing that pass. Incredible.
And in closing seconds, Noel also came up with another big play. He got the steal and took it the other way to seal the game with a layup as Kansas State would get the win 98 to 93 to advance to the Elite Eight as you watch the bench go crazy. And check out the back page of today's edition of The New York Daily News. It calls Noel the king of Manhattan, New York, and Kansas. Kansas State of course in Manhattan Kansas.
Now, Keyontae Johnson led the Wildcats with 22 points in that game, continues to be an incredible story. Johnson collapsed in 2020 while playing for Florida, was in a coma for three days he was diagnosed with heart inflammation. And instead of taking a $5 million insurance payout, never playing basketball again, Kate, he transferred to Kansas State and now has them a win away from the Final Four. Just an incredible story.
If you don't have -- if your bracket's done, Kate, you don't have anybody to root for, it's easy to root for Kansas State.
BOLDUAN: I have to admit, I haven't even looked. I've been terrified. I did -- I -- this time, I did a good job of I just decided to choose almost all upsets but I still think I screwed it up. Anyway. It's good to see you, Andy. Thank you.
SCHOLES: All right.
BOLDUAN: Thanks for watching, everybody. I'm Kate Bolduan. "INSIDE POLITICS WITH JOHN KING" starts after this break. (COMMERCIAL BREAK)