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Fed Expected to Cut Interest Rates; Economists Prepare for Second Trump Era; Trump's Legal Cases; RFK Jr. Pledges Vaccine Safety Study; Happenings Between Now and Inauguration Day. Aired 9:30-10a ET

Aired November 05, 2024 - 09:30   ET

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

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[09:33:42]

SARA SIDNER, CNN ANCHOR: Moments ago the opening bell ringing on Wall Street, as it always does. And there are the numbers for you, down just a teeny tiny bit after Donald Trump's win. That's not what we saw yesterday, though. Today, investors are looking to the Federal Reserve, of course, as they are expected to make another rate cut. The big question now is how much they might actually slash.

CNN business anchor Julie Chatterley joining me now.

What are we expecting and how have the markets been reacting? This is down a bit, but that's not what we saw yesterday.

JULIA CHATTERLEY, CNN BUSINESS ANCHOR: You're wearing the right color for what we saw yesterday, which was bumper gains. And it was relieved on the decisive result, irrespective, I think, of who won ultimately. So, a little bit of giveback to that, expected after those big gains.

To your point, today is all about the do's and the don'ts for Jay Powell and the Federal Reserve. They want to be talking about the economy. They want to be talking about inflation continuing to slow.

What they don't want to talk about, quite frankly, is Donald Trump. Good luck with that.

So, I'll give you the good news. They're expected to cut by a quarter of a percentage point, so to add to the half of percentage point cuts that we got in September. So, that is good news for borrowers.

And then it gets a little bit more exciting because, again, he doesn't want to be talking about the impact of potential tax cuts, mass tariffs being applied, immigration limits. And that makes sense because they can't react preemptively. They have to react to what they get.

[09:35:03]

But we know mass immigration limits, mass tariffs are potentially going to hurt growth and they're potentially going to be inflationary too. They'll raise prices. So, he'll talk perhaps hypothetically about that. But what's key to me is, we're not just watching stocks go up. We're

also watching the cost of government borrowing go up. Stick with me because this is important.

Some of that can be tied to stronger growth, which is good news. Some of that can be tied to the expectation of higher spending and also higher inflation. Why we care is because mortgage rates in the U.S., far more sensitive to that than what the Fed is doing and when they're cutting rates.

And that's why if you're wondering, why have mortgage rates in the U.S. been going up over the past six weeks, it's tied to this. Trump's potential policy promises can make that worse. Now, the expectation for the Fed, they cut today, they cut December, they cut next year. Trump's plans could change that, and that's key.

SIDNER: And we will be waiting to see.

The other thing that we would like to know what might happen -

CHATTERLEY: Yes. I know what you're going to ask. Yes.

SIDNER: So, there has been this acidic relationship between Jerome Powell and Donald Trump. How are they going to work together?

CHATTERLEY: Carefully, I would suggest. He's going to be asked today whether he's still going to have a job, whether he's going to stay in the job if he wants to.

Remember, Trump was quite mean to him before.

SIDNER: Yes.

CHATTERLEY: He's also going to be asked if he can remain independent. Again, he'll be careful about how he responds to these things.

The irony is, they're working together right now. Trump likes lower rates. The Federal Reserve is cutting rates. The challenge here in, and the real only impact that could be made is Trump's own policies. They could ultimately cause the Fed to do less, not more, in terms of rate cuts. So, ball in Trump's hands here. And here are some of the comments that he's made. He'd like to have a say. Hard luck. He shouldn't have a say.

SIDNER: Yes.

CHATTERLEY: The Fed needs to be independent.

SIDNER: And we will see what happens from this day forward, Julia Chatterley.

CHATTERLEY: I was about to say, it's going to be exciting for another four years.

SIDNER: All right. I appreciate you. Thank you.

CHATTERLEY: Yes, thank you.

SIDNER: Kate.

KATE BOLDUAN, CNN ANCHOR: And joining us right now is CNN global economic analyst, Rana Foroohar. She's also the global business columnist and associate editor at "The Financial Times."

It's great to see you, Rana.

RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: Good to see you.

BOLDUAN: What do you - let's start with market reaction, first and foremost. What do you think of the market reaction to Donald Trump's victory?

FOROOHAR: OK, so let's first say that almost after every presidential election you see a bump in the market. I mean there is a certain amount of, OK, now we know who the victor is. Let's celebrate. We have certainty. The market love certainty.

The thing that's very interesting to me though, when you think about it in particularly related to Trump is that the markets are betting that he actually won't implement his said economic policies. What do I mean by that? Donald Trump ran on, I'm going to put 100 percent tariffs on China. I'm going to put tariffs on allies. I want a weaker dollar because I want to make American exports more competitive.

Right now the dollar's rising, the markets are up. This is not what the markets would be doing if they thought there was going to be a massive tariff implementation and a weaker dollar coming down the pike.

Now, one thing that's interesting is that the bond market, which is, you know, always where the smart money look. It tends to be a little more forward thinking, farsighted than the equity markets. The bond markets are saying, oh, we're a little nervous. We're worried about debt and deficit levels. You may remember, Kate, that during the election there was a lot of talk about how Donald Trump's proposed policies would actually raise debt and deficit levels. The bond markets are saying, watch out, more debt might be coming. That could raise borrowing costs for Americans.

BOLDUAN: So, let's talk about the tariffs. The proposed tariffs. What he's campaigned on is something like a 20 percent tariff on all imports, and then a 60 percent tariff or so on all goods coming from China. He says he's doing it - he would do it to protect U.S. manufacturing. We've seen a lot of analysis that tariffs, though, eventually are just paid for by the U.S. consumer. What is the reality?

FOROOHAR: So, you know, I see tariffs as one tool in an economic toolbox. They are sometimes used, as they were used during the Biden administration, as a targeted way of dealing with unfair trade practices. But what Donald Trump is proposing is very different. He's talking about across the board tariffs. And essentially this is about protecting the U.S. markets. It's about starting to look at the U.S. consumer market as a bit of a chip (ph) to be given out as a reward to countries or, you know, to allies if they are giving us something in return. It's a very different way of looking at the U.S. consumer market than we've seen for decades really.

Now, if you're going to implement that kind of very protectionist policy, you'd better be sure to have a strong, robust industrial strategy for manufacturing at home.

[09:40:04]

We have heard nothing about that from Donald Trump. I mean we heard a lot of rhetoric and we saw a lot of, you know, a lot of talk, let's say, during the first Trump administration about protecting American jobs. But, frankly, that did not happen.

I think under the Biden administration you did see the beginnings of an industrial strategy. But, Kate, this is a very, very difficult thing to implement. So, tariffs with no industrial strategy at home, no way of actually bolstering U.S. manufacturing, very dangerous. And I think that introduces a real element of instability to the economy and to the marketplace.

BOLDUAN: Rana, great to see you. Thank you so much.

So, did voters just clear the legal document for President-elect Donald Trump? The new reporting that special council Jack Smith is in talks with top DOJ leadership to wind down those investigations.

And, he's a well-known vaccine skeptic and has been a dominant force in spreading conspiracy theories about vaccines for years. The new reporting on what Robert F. Kennedy Jr. could mean for public health in this country if given the green light by the president-elect.

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[09:45:07]

SIDNER: In winning the White House, President-elect Donald Trump may have also just won a get out of jail free card. His legal team, which had previously been pushing to delay the sentencing in his New York criminal hush money case, is now expected to ask the judge to cancel it altogether.

CNN chief legal affairs correspondent Paula Reid is in Washington for us.

What are you learning, Paula, about that particular case?

PAULA REID, CNN CHIEF LEGAL AFFAIRS CORRESPONDENT: Yes, it's interesting. Trump's sentencing is currently scheduled for November 26th. But his lawyers are going to argue that it should be canceled. Now, usually they're asking for delays, trying to kick the can down the road, but here they're going to ague to this judge that as a president-elect Trump is entitled to the same constitutional protections as a sitting president. As we know, sitting presidents, they are protected from indictment and prosecution. So, here they're going to extend that. Also to sentencing.

Now, if that argument doesn't work, the judge had previously self- imposed a deadline of November 12th to decide if the Supreme Court's decision on immunity over the summer means that Trump's conviction should be tossed out. If he decides that, then the sentencing, obviously, wouldn't go forward. But if the judge does not decide that the conviction should be tossed out, they will continue to make this constitutional argument. Again, they're not looking for a delay. They want this entire sentencing nixed.

SIDNER: All right, we've got another big case, perhaps the biggest case. Special counsel Jack Smith is reportedly in talks with the Justice Department about winding down, so to speak, the election interference and classified documents case. What does that - what does that mean?

REID: Yes, over the next few days we expect that these conversations between Jack Smith and top leaders of the Justice Department, including the attorney general, will continue as they try to figure out, how do they wind down these cases. They are looking at an office of legal counsel memo. That's - so that's (INAUDIBLE) inside the Justice Department that deals with those same issues that the Trump lawyers are going to argue in New York, how sitting presidents cannot be indicted or prosecuted. And they need to figure out, OK, well, how does that apply to a pending case.

And it's complicated because it's not just Trump. He, obviously, had co-defendants. And it has to do with the entire special counsel's office, right? They have a budget. They have prosecutors. What happens to the office itself. So, it's actually kind of a complicated thing to try to wind down.

Trump had previously said when he gets in office he's going to fire Jack Smith or his Justice Department would fire Jack Smith and move to have the cases dismissed. But it looks like it probably won't come to that and these cases will probably be gone before Trump arrives at the White House.

SIDNER: You've got another case in Georgia. Are you expecting the same sort of arguments from Trump's attorneys in that particular case, which is already hitting some headwinds anyway?

REID: Yes, it's interesting, the four criminal cases, they're each similar but so different in their own way. Right now the Georgia case is currently on hold while they decide if the prosecutor, Fani Willis, needs to be disqualified. But even when that decision comes, assuming she's allowed to remain on the case, that case is going to remain in limbo while Trump is in office. He's not going to face and state prosecution while he is the leader of the free world. So, the future of that case is very uncertain.

SIDNER: Paula Reid, thank you for wrapping all of that up. Lots of cases. Lots to talk about. We will see what happens. Appreciate you.

Kate. BOLDUAN: Questions swirling about Robert F. Kennedy Jr. and what role he's going to play in the next Trump administration. We know the president-elect has told Kennedy to, quote, "go wild" on America's public health agencies. He's a well-known vaccine skeptic. He's been a dominant force in spreading conspiracy theories about vaccines for years, leaving people who work in public health searching and worrying what that means for the future of public health.

Here's what RFK Jr. said after Trump's victory.

(BEGIN VIDEO CLIP)

ROBERT F. KENNEDY JR. (I), FORMER PRESIDENTIAL CANDIDATE: I'm not going to take away anybody's vaccines. I am - I've never been anti- vaccine.

I'm going to make sure the scientific safety studies and efficacies are out there and people can make individual assessments about whether that product is going to be good for them.

(END VIDEO CLIP)

BOLDUAN: CNN's Meg Tirrell is here with much more on this.

Meg, scientific safety studies. What is he talking about? And remind folks about how they are currently already available.

MEG TIRRELL, CNN MEDICAL CORRESPONDENT: Yes, Kate. I mean I think that's a big question a lot of people have, what - what data is he referring to that is not already out there in the public domain because so much of it gets out there.

We saw this during Covid as there was an incredibly expedited vaccine development process sunder Operation Warp Speed. That was one of the chief accomplishments a lot of folks said of the Trump administration. Typically this process takes years and years. You first go through animal studies before vaccines go into human clinical trials that involve thousands of patients and take years.

Finally, when you get to the large phase three studies, if those are positive enough on safety and efficacy, then a company will apply to the FDA for approval. That review process sometimes usually involves outside advisers as well, where all the documents are posted.

[09:50:01]

You see hundreds of pages of data from both the manufacturers and also the FDA reviewers own review of that data. Sometimes they disagree with what the companies have put forward or how they've interpreted some of the results.

So, that's all often very public. You can watch some of those discussions. Those day-long meetings of the outside advisers.

The FDA then makes its decision. Then it goes to the outside advisers to the CDC who have these big public meetings. You see their data and how they're looking at all of it. If the CDC director takes that recommendation about how the vaccines should be used, how often they should be taken, for whom, then the vaccines get added to schedules. The monitoring doesn't stop there though. There are many systems in place, both at the FDA and the CDC to monitor vaccine safety as they are out there in the world. And so these things are continuously monitored for their safety and their efficacy to make sure that they're serving the population in a way that everybody expects them to.

BOLDUAN: Exactly. So, what are you then hearing from people in public health about the possibility of RFK taking on such a big role?

TIRRELL: Yes, you know, talking with people, they're not necessarily thinking that RFK Jr.'s going to go in there and take one of these public health leadership roles and really disrupt things in terms of the way they work. What they are chiefly concerned about is that he will continue to chip away at confidence in vaccines to a degree that could mean we see diseases coming back that we thought we'd put behind us. Polio and measles, for example.

And if you look at kindergarten vaccination rates, for example, for the MMR vaccine, that's measles, mumps and rubella, already they have been ticking down nationally from that 95 percent level that the CDC says we need to get to, to achieve herd immunity for measles, for example. Now they are down to 92.7 percent. So, that is the main concern that this confidence in our public health system will continue to be eroded.

BOLDUAN: Meg, thank you.

Sara.

SIDNER: All right, thank you, Kate.

It's going to be a hectic few weeks as the president-elect team gets ready for Inauguration Day. The key dates on the calendar you need to know about.

And wildfires are exploding in California as we speak. Now 27 million people are facing life-threatening conditions today.

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[09:56:04]

BOLDUAN: In 74 days Donald Trump will be inaugurated once again, this time as the 47th president of the United States. And what happens between now and then is quite a lot. A new Congress convenes. The federal government needs funded. And the president-elect may or may not face sentencing.

CNN's Zachary Wolf has new analysis kind of putting it all together.

So, Zach, how does Donald Trump plan to navigate everything on that schedule while putting together this next administration? ZACHARY WOLF, CNN SENIOR POLITICS WRITER: Yes, I mean, well, look, first he needs to - he really needs to focus on putting together that new administration, but it's going to be a busy two months outside of that transition process because, as you said, it's possible that he could be sentenced. He's a convicted felon. He was - he faces sentencing. That's the first date on the calendar everybody needs to remember, November 26th. It's possible that could get waved or changed. So, you know, things could change.

One thing that's not going to change is that the electoral process - the Electoral College process, remembers voters pick electors rather than a president. It's these electors who are tied to the campaigns. We will find out officially who they are on December 11th.

And then on December 17th, they're going to meet in state capitals to officially select Donald Trump as president. This is going to be a way less dramatic process than it was four years ago because Kamala Harris has done something Donald Trump never did, which is concede that she lost the race. There are no alternate slates of fake electors. So, that will happen and hopefully it will be hitch free.

What could be complicated is that on December 20th the current Congress, the people who are currently in office, have to find a way to fund the government. This is something Republicans and Democrats disagree on. They are in a lame-duck session at this point, but they still have to figure out how to do that. Push it into next year.

And then next year, on January 3rd, we will appoint a new Congress. Those people, as a result of the election, will take the oath of office. Three days later, they count the electoral votes. Kamala Harris will face the indignity of overseeing her own election defeat, something no vice president since Al Gore has done.

And then on January 20th, of course, is the inauguration. There's going to be a lot of more - a lot more that happens in between those dates, but those are things to put on your calendar. All things to keep track of.

BOLDUAN: So, a lot has been decided, obviously, with Election Day and the path forward. One thing that still is lingering out there is who is going - is the balance of power in Congress. And where do things stand with the House of Representatives, Zach?

WOLF: This is going to be something everybody needs to pay attention to because President Trump's power will be greatly increased if he has, you know, the Senate, the House and the White House. But there's a lot of House races that are undecided. Republicans lead in some key ones, but we still don't know who's going to be in control of the House and who's going to be the House speaker. And that's going to be a really important question to keep track of in the coming weeks.

BOLDUAN: Zach Wolf. Thank you so much, Zach.

WOLF: Thanks.

SIDNER: All right, on our radar for you, utility officials cutting off power to nearly 70,000 people amid the fast-moving mountain fire in southern California, which has now burned more than 14,000 acres. Look at those pictures. They want to prevent fallen power lines from spreading flames. A red flag warning for dangerous and life- threatening fire conditions is in effect for 27 million people there and in the San Francisco Bay area.

And want to help your brain age slower? Listen up. Researchers say exercise, avoiding tobacco, speaking a second language or even playing a musical instrument can all factor into how your brain ages later in life. Now, those factors could be responsible for up to a 20 percent different in cognitive decline from the age of 70 to 82.

[10:00:03]

Oh, and let's not leave out one of the biggest things here for us anyway, poor sleep can be a factor. That