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U.S. Stocks Fall as Trump's Tariff Package is About to Take Effect; American Among Three Hostages Set to be Freed From Gaza Tomorrow. Aired 3:30-4p ET

Aired January 31, 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]

BORIS SANCHEZ, CNN HOST: Wall Street is clearly signaling its concern with the Dow falling just as the White House confirmed this afternoon that within the next 24 hours, President Trump is set to put in place new tariffs on goods coming into the United States from Canada, Mexico and China, and that is stoking fears of inflation. In one survey of economists, 95 percent agree that tariffs will likely mean higher prices for consumers.

Let's discuss this new data with Mark Zandi, the chief economist at Moody's. Mark, thanks so much for sharing part of your afternoon with us. These tariffs looming over the weekend, the White House would not give details on whether there would be exceptions for things like oil products. I wonder how you think the markets and consumers are going to be affected by this.

MARK ZANDI, CHIEF ECONOMIST, MOODY'S: Well, Boris, it depends, right? It depends on how high the tariffs are, which products, if there are going to be exemptions or carve outs, how long the tariffs will be in place. So there's a lot of imponderables, which, you know, highlights one of the problems with tariffs, and that is it creates a lot of uncertainty for businesses and consumers and, you know, is a problem for economic growth.

But it's hard to answer that question because we just literally don't know. I mean, we could play an experiment. Let's say that the president follows through and imposes 25 percent tariffs on all goods, imported goods from Canada and Mexico, and 10 percent on all goods from China, no exemptions, no carve outs, and keeps them in place for a year, then that would add six to seven tenths of a percent to consumer price inflation.

So just to make that concrete, instead of, say, inflation being 2 percent over the next year, it would be 2.6 or 2.7 percent. But that's extreme. That's kind of an outside kind of scenario. I doubt the president has that in mind, but that gives you kind of context.

SANCHEZ: This afternoon, in response to the message from the White House, the Canadian Prime Minister Justin Trudeau responded, saying that if the U.S. moves ahead, quote, Canada is ready with a forceful and immediate response. How would a trade war potentially take shape and specifically which products coming from Mexico and Canada, for example, do you think consumers might wind up paying more for? ZANDI: Yes, well, of course, Prime Minister Trudeau's comments highlight another problem with broad-based tariffs, and that is other countries are going to respond. You know, they're going to retaliate just like they did in President Trump's first term when he imposed tariffs on China.

And that costs American jobs. It hurts manufacturers who export a lot of product. It hurts farmers and agricultural industries because they export a lot of product. So it, you know, does a lot of damage.

If you look at what we import from Canada, Mexico, China, it's a wide array of products. You know, it's 35 percent of all of the imported goods that we bring into the country come from those three countries. Those are the big three countries from which we get imports.

So it's everything from cars to electronics, furniture, fresh food. You know, we get a lot of avocados and berries and tomatoes from Mexico, machine tools, you know, from Canada. We get a lot of oil, lumber. So, you know, the cost of home construction is very high, and this would add to it and make it more difficult to afford to buy a home.

[15:35:02]

So just a wide array of products would be affected by the higher tariffs. Again, Boris, if there are no exemptions and carve-outs.

SANCHEZ: Right. You mentioned the potential for inflation to go up somewhat. Obviously, it hit a high a few years ago, but it's still sort of a stubborn inflation that hasn't gone down as much as the Fed would like. I wonder why you think that is.

ZANDI: Yes, that's exactly right. You know, it's come way back from where it was, but it's still not back to something that the Federal Reserve feels comfortable with. That's their so-called 2 percent inflation target.

We got data today, for example, Boris, that showed inflation was 2.6, 2.7 percent. So it's still a bit elevated. You know, I think it's a range of things, but a big part of the difference between current inflation and the Fed's target is the cost of the growth and the cost of housing. You know, rents have been up, and that has kept the housing costs up. And that's what's reflected there. But, you know, inflation remains persistent.

And really, nothing makes Americans more anxious than, you know, having to pay more for groceries and for rent and for gasoline. And clearly, broad-based tariffs would add to that angst and those concerns.

SANCHEZ: Mark Zandi, we have to leave the conversation there. Appreciate your analysis, as always.

ZANDI: Sure thing.

SANCHEZ: Stay with NEWS CENTRAL. We'll be right back. [15:40:00]

(COMMERCIAL BREAK)

BRIANNA KEILAR, CNN HOST: The next steps in the ceasefire and hostage release deal in Gaza is bringing a brief moment of joy for one family in Tel Aviv. This is the wife and the daughter of Israeli-American Keith Siegel embracing after they just learned that he will be one of three hostages freed tomorrow, according to Hamas. The other are French-Israeli Ofer Kalderon and Yarden Bibas. Bibas' long-awaited freedom is mixed with deep sorrow.

More now from CNN Jerusalem correspondent Jeremy Diamond.

(BEGIN VIDEOTAPE)

JEREMY DIAMOND, CNN JERUSALEM CORRESPONDENT: Well, one of seven Americans still held hostage in Gaza is set to be released tomorrow. Keith Siegel, a 65-year-old who was taken hostage from his home in Kibbutz Kfar Aza, will be released alongside two other Israeli hostages. His wife Aviva Siegel, who was also taken captive on October 7th, she has relentlessly advocated for his release in both the United States and Israel since she was released in that November 2023 ceasefire deal.

Ofer Kalderon is the second hostages set to be released. His two children had been held hostage in Gaza and were also released during that November 2023 hostage deal.

And we are also expecting Yarden Bibas to be released. He is, of course, the father of the two youngest Israeli hostages being held captive in Gaza. Kfir and Ariel were just nine months old and four years old when they were taken captive from Kibbutz Nir Oz on October 7th and truly became a symbol of the brutality of that day. Hamas claimed that they had been killed in an Israeli airstrike alongside their mother, Shiri Bibas, but the Israeli government has never actually confirmed their fate. The fact that Yarden Bibas is now expected to be released before them raising serious concerns about their fate.

This is a statement from the Bibas family saying: Our Yarden is supposed to return tomorrow and we are so excited, but Shiri and the children still haven't returned. We have such mixed emotions and we are facing extremely complex days.

Important to note that last week, Admiral Daniel Hagari, the spokesman of the Israeli military said that they were quote, gravely concerned for the fate of Shiri, Kfir and Ariel.

All eyes will also be on how this hostage release actually unfolds tomorrow following those chaotic scenes from that release of hostages on Thursday in the southern Gaza city of Khan Younis.

And now the fate of the Rafah crossing depends on that. An Israeli official telling us that the Rafah crossing will only become fully operational as long as that chaotic hostage release we saw on Thursday does not unfold once again. If it does become fully operational, the World Health Organization says that 50 wounded patients from the Gaza strip are set to be medically evacuated through that crossing. The first time that will happen since May of 2024.

(END VIDEOTAPE)

KEILAR: Our thanks to Jeremy Diamond for that report.

Coming up, we go inside a flight simulator with a commercial pilot to get a sense of what flying into Reagan National Airport at night looks like. Why he says flight procedures should be reexamined to keep this disaster from happening again.

(COMMERCIAL BREAK)

SANCHEZ: So we are standing by for an update from the NTSB on the latest in the investigation into Wednesday's midair collision. The Army has just named two of the three soldiers on board the Black Hawk helicopter involved.

A chief warrant officer, Andrew Eaves, was the instructor pilot on the flight. He was from Great Mills, Maryland, and had more than 1,000 flight hours of experience. Staff Sergeant Ryan O'Hara was from Lilburn, Georgia, and was the Black Hawk's crew chief. He joined the Army back in 2014 and had served at least one tour of duty in Afghanistan.

KEILAR: The family of the third soldier has requested that her name not be released, but CNN is told she was co-piloting the Black Hawk and had about 500 flight hours. These identifications come as the White House doubles down on President Trump's claims that DEI hiring policies at the FAA played a role in the crash.

CNN's Jeff Zeleny is at the White House for us live. Jeff, during today's press briefing, the White House press secretary doubling down on the president's belief and assertion that DEI is partly responsible for this tragedy, something that he said with no evidence. Has the White House provided any proof?

[15:50:00]

JEFF ZELENY, CNN CHIEF NATIONAL AFFAIRS CORRESPONDENT: Brianna, the White House has not provided any proof to back up the president's statements. As you said, he said earlier today on social media that the helicopter was flying too high.

Now, that certainly has been speculation that several people have made. Senator Tammy Duckworth, a former helicopter pilot as well, has raised that as a possibility. So this certainly is a preliminary possibility. But the president stated it as fact.

The White House, though, talking about those DEI initiatives, they simply repeated that throughout the federal workforce at the FAA, they said that the hiring practices of previous administrations have allowed unqualified people to work and serve. There is no evidence for that. But the president, again, signing an order yesterday and the White House doubling down again today talking about those hiring practices. But, again, we should point out there is simply no evidence to back that up. It has been something that, you know, has been floating out there in several instances of aviation near misses and things that is there, you know, an experience or qualification factor happening here. But, again, there's no evidence to back that up.

And specifically on the naming of the copilot on that helicopter, the White House did not comment specifically on that. The president, I should note, is in the Oval Office right now signing unrelated executive orders.

That is often a time when he answers questions and talks again. So we will let you know if there's any updates on his earlier comments here today -- Brianna.

KEILAR: All right, Jeff Zeleny, live for us at the White House. Thank you.

The Department of Transportation has just announced that effective today the FAA will restrict helicopter traffic in the area over the Potomac River.

SANCHEZ: The airspace over D.C. has been described as congested and challenging to fly in. CNN national correspondent Jason Carroll hopped inside a flight simulator to give us a better idea of what pilots actually see.

(BEGIN VIDEOTAPE)

JASON CARROLL, CNN U.S. NATIONAL CORRESPONDENT: I'm here with Aaron Murphy. He's a commercial pilot. He's also a flight instructor. He has logged hundreds of hours in flight simulators like the one that we are in right now.

And what he's doing is he's put up on the simulation. This is what the approach to Reagan airport would actually look like.

Now, this is not a CRJ 700. It's a 737, but it gives you an idea of what these pilots would be, or any pilot for that matter would be looking at on approach to Reagan. Correct?

AARON MURPHY, FLIGHT INSTRUCTOR/COMMERCIALLY LICENSED PILOT: That's correct. So as you can see out the window right now, the only way, you know, there's a river beneath us is because of the -- what we call a black hole. There is no definition. There are no lights. We know there's a bridge going across the river just ahead of us here. And that's how we know that's water.

And of course, you know the area flying in here as a pilot, you would recognize you would know already that is a river. But that's what it looks like at night.

CARROLL: When you're training these pilots on approach, what are some of the things that you specifically are telling them to look out for? MURPHY: Number one, other traffic, which unfortunately is a situation that just happened yesterday. Looking out the window right now, for example, you see how the lights have a bit of a twinkling effect. A lot of that can camouflage other aircraft. The lights within that carpeting of lights, it can be very difficult to see other moving vehicles. And not only that, but then you have moving vehicles on the roadways in the lights.

CARROLL: And so very difficult obviously, to see something like a Black Hawk helicopter.

MURPHY: A hundred percent, yes. It would be very difficult to see an aircraft like that.

This airport is a known hotspot in aviation. So coming into Reagan, number one is traffic. Even though you brief it and you discuss it and you're ready and you've got it sorted out. This is a perfect example of how sometimes things just unfold in a way that you really don't expect.

CARROLL: Even with experienced pilots.

MURPHY: Yes. And if you listen to some of the reports that CNN has done with some -- some other very famous pilots that we have, they have said that they've been into this airport many, many times with helicopters flying underneath them. So it's a standard procedure.

Something was different last night. Something happened that was different enough to bring the airplanes together. The aircraft came together.

CARROLL: Whenever there was an air traffic tragedy lessons are learned. I'm wondering if you think what lessons might be learned at this time.

MURPHY: This is a procedural accident. We need to get deeper into the procedures of how the helicopters are flying up and down the river, and even how the aircraft are approaching and doing that circling approach to land on 33. We need to fine tune that. There's been lots of different situations at this airport. It's a hotspot in the aviation community.

CARROLL: Because of all the traffic.

MURPHY: Many pilots know this already and that's why you have specialized training to fly into that airport for exactly this reason.

(END VIDEOTAPE)

[15:55:00]

SANCHEZ: A really fascinating perspective and our thanks to Jason Carroll for that report. Stay with NEWS CENTRAL. We're back in just a few minutes.

(COMMERCIAL BREAK) KEILAR: So we are waiting to get an update from the NTSB on the investigation into the American Airlines jet that collided with a military helicopter. And as we mentioned before the break, the DOT just announced that the FAA is going to restrict helicopter traffic in the area over the Potomac River. This will exempt helicopters entering this airspace for life-saving medical support, active law enforcement, air defense, or presidential transport helicopter missions.

[16:00:00]

SANCHEZ: For some perspective, this is the deadliest aviation disaster in the United States since 2001.

And this Sunday night at 7 p.m. Eastern, CNN's Anderson Cooper will examine the circumstances around this crash and other recent incidents in a new episode of "THE WHOLE STORY" with Anderson Cooper. So make sure to tune in to CNN for that.

We are also awaiting word from President Trump. That should come shortly, so a lot to stay tuned for. Don't go anywhere.

"THE LEAD" with Jake Tapper starts right now.

END