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How U.S. Economy Could Fare During Trump's Second Term; Trump Threatens 25 Percent Tariffs On Mexico And Canada On February 1; South Hit With Once-In-A-Generation Winter Storm; Ukraine's Zelenskyy Asks if Trump Will Even Notice Europe. Aired 3:30-4p ET

Aired January 21, 2025 - 15:30   ET

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

[15:30:00]

KAYLA TAUSCHE, CNN HOST: We know the economy was the top issue for voters, but now where will President Trump's policies take it? CNN's Matt Egan is here to break it down.

BORIS SANCHEZ, CNN HOST: And CNN's business editor at large and anchor of CNN's Quest Means Business, Richard Quest, is joining us from the World Economic Forum in Davos. First to you, Matt, what can we expect?

MATT EGAN, CNN REPORTER: Well, Boris and Kayla, look, the president has started off really hitting the ground running. He had this avalanche of executive actions that he signed. He's proposing sweeping reforms to everything from immigration and trade to regulation and energy.

And anytime there is a change in power, there's going to be uncertainty. But there's even more uncertainty right now, just given the sheer scale of the changes that President Trump is proposing. And there's a lot of major questions looming over the economy right now.

Whether or not these executive actions from President Trump are going to be impactful, when he's going to increase tariffs and how high they're going to go, and whether or not these mass deportations are going to starve key industries of workers. And what's notable is that despite all this rhetoric, the president is really inheriting a very healthy economy. The consumers continue to spend money.

The unemployment rate is at 4.1 percent. Only two presidents in modern history have entered office with lower unemployment rates. And that was George W. Bush back in 2001 and Richard Nixon back in 1968.

Of course, Trump knows that Americans are not frustrated with the jobs market. It's the cost of living that remains the major issue. Right. How much more money everyone is spending on everything from groceries to car insurance. And Trump has promised to really tackle this issue head on.

But he's also called for prices to actually drop. He's promised that prices are going to go down under him. And economists that I talk to, they say that that is just very unlikely.

Unless there's some sort of severe recession or even depression, prices are not going to outright drop. But ultimately, Trump may not need price drops to be successful on the economy. What he needs to root for is for paychecks to continue to go up at a faster pace than prices. And the longer that that continues, the better everyone's going to be able to feel about this economy and about the cost of living.

TAUSCHE: And then there is the stock market, which we know is President Trump's preferred scorecard for his administrations. And stocks today have been rallying, notably after he did not follow through on his vow to impose sweeping tariffs on day one, essentially breathing a sigh of relief. How do you interpret this?

EGAN: Well, Kayla, you're right. It is kind of ironic, right? After so many different executive actions yesterday from the White House, it's actually what President Trump did not do that is really encouraging investors.

And that's the fact that he did not keep that promise, that threat to impose day one tariffs on Mexico and Canada and China. Though we should note that last night Trump did say that he still plans to increase tariffs on Canada and Mexico on February 1st. And so we can expect investors to pay very close attention to those threats because, listen, investors love the tax cuts and the deregulation that the president's promising, but not the tariffs.

SANCHEZ: Matt Egan, thank you so much for that. Let's bring in Richard Quest. Richard, how are leaders there reacting to Donald Trump's return to the White House on his first day back in office?

RICHARD QUEST, CNN BUSINESS ANCHOR AND EDITOR AT LARGE: Well, it depends which side of the fence you're on. If you are the bankers and the financiers and the hedge funds and if you are in love with crypto.

[15:35:00]

And by the way, guys, there's a whole load of them out there. That's all they live for.

Then you cock a hoop. This is what you want. You are going to be off to the races with the new Trump administration.

On the other side of the fence are all those NGOs, non-governmental organizations, the DEIs, the social work, anything to do with, if you will, the poverty, the less, if you will, those who have less. They are absolutely gutted by what they see as being very mean spirited policies over the next four years. And I think that is the way it's going to be as seen from somewhere like Davos.

You have those who are talking about the environment, the climate, energy policy, social welfare nets and all those sort of things. And they are not encouraged. Pretty much like the bishop who gave the invocation today at the cathedral in Washington.

On the other side, you have the growth creators, the wealth creators, and they are saying, nope, best thing that's ever happened. America's off to the races. SANCHEZ: And Richard, what about the consensus regarding tariffs? I mean, is there one? It seems like a lot of these countries are bracing for a trade war essentially.

QUEST: Yes. Look, to most economists and most government leaders, if you will, it's the equivalent of being told the world is flat after all. Because the traditional orthodoxy ever since the 1920s has been targeted tariffs work, targeted tariffs good, general sweeping tariffs bad, smooth, holy, led to recessions, led to depressions, not a good idea.

Now you have the U.S. president not only tariffing, but tariffing allies and close allies and even allies within treaties like, of course, Canada and Mexico. So the orthodoxy has been thrown out the window.

They are all basically saying, all right, bring it on. You want tariffs. We will retaliate. And you know the phrase, the rising tide lifts all boats. Well, the sinking ship takes all down with it.

SANCHEZ: Yikes. Richard Quest, thank you so much for the analysis. Appreciate it.

When we come back, this is Florida, Florida, the sunshine state where snow is falling heavily today. New Orleans and Houston also looking like winter wonderlands right now. I'm not sure anybody's actually calling it a wonderland.

We have the latest on the southern snowstorm when we come back.

[15:40:00]

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SANCHEZ: Historic snow is burying the Gulf Coast amid the first ever blizzard warning for some coastal cities impacting places like Houston and New Orleans.

TAUSCHE: Take a look at this video. This is Bourbon Street in the New Orleans French Quarter. Heavy snow, strong wind gusts. They are combining to create whiteout conditions in southern Louisiana of all places.

And the same goes for the Florida Panhandle where this incredible traffic cam footage was shot just a couple of hours ago.

CNN meteorologist Chad Myers is tracking temperatures and snowfall totals from the CNN Weather Center. Chad, for all the kids who are flushing ice down the toilet and wearing their pajamas backwards, how long will this arctic chill last?

CHAD MYERS, CNN METEOROLOGIST: Well, I'm afraid the cold air is not going anywhere for a while but there will be snow on the beaches from Texas to Delaware. Now, OK, not in the southern part of Florida but Pensacola, Panama City, Destin will have snow on the beach. So will Tybee Island all the way up to Myrtle Beach and all the way up to Rehoboth.

It is 30 degrees right now in Anchorage, Alaska. It is 22 and snowing in Atlanta, Georgia. And yes, New Orleans, you already have almost 6 inches of snow.

Call it historic. Somewhere back in the 1800s, there was a 10-inch snowfall but anywhere these new records or modern records, doubling the modern records for sure. And Lafayette, you just now reported 9.5 inches of snow. There will be places in the southern part of the U.S. that have a foot of snow on the ground and likely not even a snow plow in the county. That's what this is going to be like. This is going to be a storm that really slows things or stops things for a very long time.

And it's going to snow in New Orleans for many more hours. More hours for you, Mobile, for Gulfport, all the way over. It hasn't even started yet really for Destin. But it's not far offshore. Here is all the snow still to come.

The heaviest snow still to come for some places with widespread disruptions. I-10 is completely shut down. I mean, if you go from Mobile to really almost Texas, very little of I-10 is actually on the ground.

It's above the ground. It's on pilings, and it's just a big, long bridge. Well, the bridges just can't handle this type of snow. They can't keep it off. So Savannah, Charleston, all the way up, all the way to Virginia Beach will have snow on the sand. Even for you, Charleston and Savannah, there's a chance of a sleet event kind of mixing in tomorrow.

There are some people in Savannah that likely won't get to work tomorrow for sure. And another six inches of snow. The forecast office around Tallahassee is saying there could even be blizzard conditions around Tallahassee, Florida, in the next coming hours. Unbelievable weather.

TAUSCHE: There is going to be a lot of hunkering down.

SANCHEZ: I have to ask, Kayla, why are kids flushing snow down the toilet?

[15:45:00]

TAUSCHE: Oh, that is sort of the trick to get the snow to fall so that your school is canceled. And it totally works.

SANCHEZ: Brilliant. Brilliant. Good to know. Good information.

MYERS: I grew up in Buffalo, and I had never heard of that one.

TAUSCHE: I grew up in Atlanta, and we did it often. It didn't always work.

SANCHEZ: It feels like there's going to be a ton of snow flushed down the toilet tonight. Chad Myers, thank you so much for the update. Stay with NEWS CENTRAL. We'll be right back.

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TAUSCHE: Ukraine's President Volodymyr Zelenskyy spoke to world leaders gathered in Davos, Switzerland today, saying the U.S. is an indispensable ally to Europe. But then he suggested the U.S. may not reciprocate, asking, quote, Will President Trump even notice Europe?

[15:50:04]

Trump missed his own deadline on ending Russia's war on Ukraine, which he said he would do within 24 hours of taking off. However, yesterday he did have some critical words for Vladimir Putin.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Zelenskyy wants to make a deal. I don't know if Putin does. He might not. I don't know. He should make a deal. I think he's destroying Russia by not making a deal. I think Russia's going to be in big trouble.

You take a look at their economy, you take a look at the inflation in Russia. So I would hope that Putin will make a deal.

(END VIDEO CLIP)

TAUSCHE: Joining me now is CNN National Security Analyst Beth Sanner, who served as Deputy Director of National Intelligence in Trump's first administration. Beth, it's good to see you. Trump's special envoy to Ukraine has asked for 100 days to reach a deal, which is warp speed considering how the war has been grinding for three years.

What do you think will happen in that time frame?

BETH SANNER, CNN NATIONAL SECURITY ANALYST: I don't think that they're going to get there. And I think that actually President Trump has been more realistic by saying that in recent weeks, by saying that it might take six months. And, you know, I think that this year coming to an agreement is going to be difficult. And he pointed out exactly why. So he, you know, he understands the main problem here is Russia. He said Zelenskyy is ready to do a deal, but Putin, I'm not so sure.

And the implication of that is that he doesn't believe that they're ready. And he's kind of trolling Putin, isn't he?

TAUSCHE: Yes, well, having covered Trump's first administration, his instinct has always been just get in the room and talk. And to that end, he said that he has set a meeting with Russian President Vladimir Putin. I mean, you have briefed the president in your previous role as Deputy Director of Intelligence.

I'm curious how Trump approaches these meetings and what you expect from that sit down.

SANNER: Well, I think they're dangling that, but they're not saying when it is because I think what we heard right now is part of the negotiation, right? And Trump is always negotiating. So he's trolling, he's dangling the opportunity because Putin wants that one-on-one, that great man to great man negotiation.

And President Trump definitely understands that. So, you know, he is now trying to play on Putin's vulnerabilities by saying, you know, that's not a good look, right? That doesn't look good. You're failing.

And so these are all the kinds of things that he will do. But during that meeting, he'll also lay on the charm and try to encourage Putin to understand that he will be economically better off if he does a deal.

TAUSCHE: In that Davos speech, President Zelenskyy suggested that Trump in those talks with Russia could ignore Europe altogether. I want to listen to what he said in more detail and get your reaction on the other side.

(BEGIN VIDEO CLIP)

VOLODYMYR ZELENSKYY, UKRAINIAN PRESIDENT: We see how much influence China has on Russia. And we are deeply grateful to Europe for all the support it's given our country during this war. But will President Trump listen to Europe? Or will he negotiate with Russia and China without Europe? Europe needs to learn how to fully take care of itself so that the world can't afford to ignore it.

(END VIDEO CLIP)

TAUSCHE: It seems he meant that as a warning, but that's essentially what President Trump has been asking for, to have Europe defend itself. What do you make of that?

SANNER: Zelenskyy is speaking as a European, and he wants Europe to stand up, and he wants Europe to be part of the negotiation because he knows that Europe is going to be really in defense of Ukraine in these negotiations. So I think that Zelenskyy is trying to give Europe a spine, and they need it.

TAUSCHE: Well, that war will enter its fourth year on February 22nd. Of course, the clock is ticking. Beth Sanner, we appreciate your time today. Thank you.

SANNER: Thanks, Kayla.

TAUSCHE: When we come back, you can now buy airplane tickets using Venmo. Why JetBlue is bringing the popular app on board.

[15:55:00]

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SANCHEZ: We just wanted to share these live images from New Orleans as snow continues to fall in the Big Easy. There are reports that some seven inches of snow have already fallen. The winter storm making impacts all across the south and we're now learning that more than 2,000 flights have been canceled as a result of the storm.

TAUSCHE: We saw just one person walking in that video.

SANCHEZ: There's a few more now. I was afraid for a moment that it was the same guy we saw a few hours ago and I wanted to tell him, man, just get inside, it's not, it's not a good idea. But yes, this is happening all across the southeast and it's fascinating to watch, especially because these are areas that don't often get this kind of snow. So the reaction from people is part of the fun of not being in it, but watching.

TAUSCHE: And having grown up in one of those areas, our winter coats are just a fleece jacket. So Godspeed to everyone.

SANCHEZ: So here's a quick question. Have you ever used Venmo to pay back a friend? Now you can use it to travel all over the world.

JetBlue says that customers can now use Venmo to book their flights. It's the first airline partnership for the popular payment app.

[16:00:00]

Customers now have the option to use Venmo on JetBlue's website instead of those archaic old timey methods like using a debit or credit card.

TAUSCHE: Plastic is so out. The airline hopes this gives customers an easier way to book flights. JetBlue has been searching for ways to broaden its appeal in recent months, including adding new features to its own app and creating airport lounges. But I want to know, do I need to know the last four digits of JetBlue's phone number to be able to pay on Venmo?

SANCHEZ: That's a good question.

TAUSCHE: How does this work?

SANCHEZ: We'll get back to you on that.

"THE LEAD" with Jake Tapper starts right now.