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Markets Open as Trump Slams Tariffs on Mexico, Canada and China; Doug Ford is Interviewed about Tariffs with Canada; Trump Pauses Military Aid to Ukraine; Melania Trump's Guests for President's Address. Aired 9:30-10a ET

Aired March 04, 2025 - 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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[09:30:33]

KATE BOLDUAN, CNN ANCHOR: So right now, as we speak, the opening bell is beginning to ring on Wall Street. And this is now really the first trading day since China and Canada slapped back overnight. President Trump's new tariffs on three of America's largest trading partners now triggering a trade war.

And look at this, in just the opening seconds. The CEO of Target saying just this morning that consumers will likely see prices increase in just a matter of days.

CNN's Vanessa Yurkevich tracking all of this for us. She's here with me now.

And, Vanessa, Mexico just responded.

VANESSA YURKEVICH, CNN BUSINESS AND POLITICS CORRESPONDENT: Yes. We just heard from the president of Mexico, Claudia Sheinbaum, and she said that this trade war is not good for any country involved right now. Take a listen to what she said just moments ago.

(BEGIN VIDEO CLIP)

PRESIDENT CLAUDIA SHEINBAUM, MEXICO (through translator): We will respond with tariff and non-tariff measures, which will be in force as from next Sunday.

(END VIDEO CLIP)

YURKEVICH: OK, so we're going to learn more on Sunday exactly what those responses will be. They will be retaliatory tariffs and non- tariff measures. That will be interesting to see what those look like.

We also know how China is responding. They are putting retaliatory tariffs on agriculture products here in the U.S., 15 to 10 percent on key products like soy, corn, poultry, things that are critical that the U.S. exports. And that is going to put U.S. farmers in a critical position because they rely on China buying so much of our agriculture products. This happened in 2018. And this was something that really impacted farmers. So much so that the federal government, the U.S. federal government, had to help out farmers with market facilitation payments, payments to offset the losses.

But markets right now, at last check on the board I was seeing, were really taking a tumble off of all of this news. The tariffs that went into place at midnight and also the retaliatory tariffs that we're seeing right now.

Also critical to note that these three countries are our biggest trading partners, right. This is going to impact $1.4 trillion worth of goods that the U.S. gets every single year. That is 40 percent of all goods that we get every single year.

So, for consumers at home, what is this going to impact? Food, oil, cars, apparel, toys. So much of what U.S. consumers are used to getting. The likelihood of seeing higher prices is very strong. That could happen immediately. That could happen in the future, depending on how much businesses can stockpile and absorb these prices.

But for the U.S. consumer, we know that they are not feeling great about the U.S. economy right now. Sentiment has fallen. Inflation is heating up. This injects so much uncertainty into the U.S. consumer. And that's why we heard from Target this morning saying that they are worried about what the business outlook looks like.

BOLDUAN: And what's going to - some - if something's going to give, what is it, is actually even more unclear today because hearing from President Trump yesterday, when it comes to at least Mexico and Canada, it seems that the reason for these tariffs is now shifting. It was immigration and it had to do with drug - fentanyl coming across the border. Yesterday he was talking about cars. So, it's all over the map.

YURKEVICH: It's all over the map. And he gave Mexico and Canada 30 days to kind of get things into place. But it looks like that did not happen fast enough. And as you said, the goalpost, the end line keeps shifting. This is only the beginning. This could escalate further.

BOLDUAN: Thanks, Vanessa, for tracking it with us.

John.

JOHN BERMAN, CNN ANCHOR: I just want to keep those market numbers up if I can for a moment longer because we've been charting them since we came in overnight. This is the Dow now down more than 1 percent. It's basically the same thing at the S&P and the Nasdaq.

When we came in overnight it was basically flat. But as the morning has progressed, I think investors getting more and more gloomy. The reaction from China and Mexico and Canada perhaps a little bit harsher than the administration had expected. You can see just the fall keeps on happening here. This is after huge losses yesterday.

And as for that reaction from these countries, we read in "Politico" that Ontario Premier Doug Ford threatened to shut off his province's electricity exports to the United States and block shipments of Ontario's high-grade nickel, which he said provides 50 percent of U.S. supplies. This is per "The Globe and Mail." He added, "if they want to try to annihilate Ontario, I will do anything, including cutting off their energy," this is energy to the United States, with a smile on his face.

[09:35:08]

With us now is the man, I guess, behind that smile, Doug Ford, the premier of Ontario in Canada.

Premier, thank you so much for being with us.

OK, what are your plans and how far are you willing to take it?

DOUG FORD, ONTARIO PREMIER: Well - well, first of all, I have to tell you, Canadians love Americans. We love the U.S. It's one person that's causing these problems. I've talked to senators and congress people and governors, Republicans and Democrats. Not one of them agree with him. I've talked to business CEOs of the largest companies. They totally disagree with this.

And President Trump ran on a mandate to lower cost, to create more jobs. This is going to do exactly the opposite. The auto sector, we buy over 400 percent more autos than Mexico, 200 percent more than anywhere in the - in the world.

And, you know, he put up a smoke screen. He keeps moving the goalposts. Well, the market is speaking loud and clear. The market is going to go downhill faster than the American bobsled team. And we're going to continue seeing in the U.S. plants close, assembly lines shut down. In the auto sector, they may last five, maybe eight - eight days before the parts that go back and forth across the border eight times.

This is unnecessary. And we do have to retaliate. And I apologize to the American people. It's not you, it's your president that's causing this problem. We're the number one customer in the world to the United States. We had a great relationship. I want to continue on with that relationship. But I will use every tool in our toolbox to send a message to President Trump that this is the wrong thing to do.

When Warren Buffett comes out and says, this is - this is basically insanity, you have to listen to someone like Warren Buffett.

BERMAN: So, some of the thinking inside the administration goes something along the lines of, in the United States, we can withstand more pain than you can in Canada. So how much pain can you withstand here?

FORD: Well, we have the lowest debt in the G-7. The United States have more debt than anyone. He wants to come and get a tax break - put a tax break through. He's relying on two congress people. He loses two people, that's it, these tax breaks aren't going.

And he's doing this on the backs of the American people. He's going to create job losses. Inflation is going up. The market's dropping. Gas prices are going up. Groceries are going up. For what? We have a very fair trading balance. And if we exclude the energy, the

oil that we ship down, 4.3 million barrels a day to keep cars going, the U.S. has a $55 billion surplus on everything else, on manufacturing. And I'm fine with that. $55 billion is fine. But we're your number one customer to 28 states.

BERMAN: How -

FORD: I've directed our office (ph) to take off all the alcohol. We're the largest purchaser of alcohol in the world. We sell to 30 - or they - we buy from 35 states, 3,600 products, over a billion. They're coming off. We've directed our team to pull off the $30 billion of contracts and not use any American companies.

And again, I apologize to the American people, but the red states, the people have to start calling their senators, their governors and congress people to stop this insanity that one person's causing.

BERMAN: What do you understand the demands to be? On the one hand we've heard, over the last few weeks is, it's cracking down on the border, going after fentanyl distribution. Now, the president is saying he wants much of the manufacturing returned to the United States. What do you think the ask is?

FORD: Well, you can't - in the auto sector - and no one knows what the ask is. It depends on what he wakes up and eats in the morning, and that changes. You know, the auto sector, you can't unscramble an egg that's been made since the 1960s in the auto pact and expect plants to just open - open up. We buy as many cars as we sell them down to the U.S. It's been working. It's a great, great system that we have right now with all the auto sectors, but it will only last eight to maybe ten days at the max. And then you're going to see auto plants being shut down.

I wish we knew what the president wanted. We need to sit down and move forward on the USMCA and put this behind us.

BERMAN: I've just got to ask you, you know, very briefly, how upset, how mad are Canadians? Canadians aren't - aren't usually the types to get angry, but how are Canadians this morning?

FORD: They're absolutely livid. They're - they're furious. Because we look at the United States as our family. We're one big family. We've stood shoulder to shoulder in wars and every other crisis there is. We love the American people. But unfortunately, the president has gone sideways on ourselves.

[09:40:04]

And, you know, we - we power - Ontario powers 1.5 million homes and businesses in New York, in Michigan, in Minnesota. I've talked to all three governors. I want to ship more electricity. I want to send more critical minerals. But I will not hesitate to use every tool in our toolbox to protect Ontarians and Canadians across the board.

I've never seen patriotism run so wild across our country. Right down to the grocery aisles, people refuse to buy American products. This - this is not right. We love America. We love the people. And the president needs to be stopped. It's as simple as that.

BERMAN: Doug Ford, the premier of Ontario in Canada, we do appreciate your time. Thank you for being with us.

FORD: Thank you.

BERMAN: Again, we continue to watch the U.S. markets, now off their lows by a little bit, but still dropping precipitously after the open.

All right, new this morning, a Ukrainian official says the country will run out of artillery in just months after President Trump put a pause on aid.

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[09:45:28]

BERMAN: All right, this morning, a Ukrainian official tells CNN they will likely run out of artillery shells by May or June. This after President Trump ordered a pause to all U.S. military aid.

With us now is CNN chief national security analyst Jim Sciutto.

No artillery shells by May or June.

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY ANALYST: Yes.

BERMAN: That's one impact. What else are we likely to see?

SCIUTTO: In a word, I spoke to a U.S. military official. The word is devastating. So, start with munitions, artillery shells, which had already been an issue for the last several years, getting enough in given the consumption of the shells on the front line. But even bigger is air defenses because Russia is continuing, and even expanding its onslaught through the last several weeks and months. And the Patriot Missile System, the U.S. Patriot Missile System, is the only system Ukraine has that could shoot down ballistic missiles from Russia. They have other systems that could take down drones, which are slower moving, et cetera. But for ballistic missiles, some of the deadliest, that is only the Patriot could take it out. So, they begin to run out of the missiles that supply those air defenses.

The next level, which will be devastating, would be the loss of intelligence sharing, because the intelligence sharing goes in both directions. One, it's about picking your targets on the Russian side to push them back, but it's also overwatch, as you're watching all these weapons come in. Without that, Ukraine is at an enormous disadvantage.

And then the final one is morale. I've been hearing this both from Ukrainian officials and Americans for some time, that as they feel America abandoned them, and that is how they view it, I had a Ukrainian officer messaged me this morning calling it a betrayal. The folks on the front lines who are already suffering are wondering if - if America doesn't have our back, am I a sitting duck out here, right? Does that begin to break down cohesion on the front lines? It's a genuine concern.

BERMAN: Look, it's a proud people, but they are so vulnerable, they can only take so much.

SCIUTTO: Yes.

BERMAN: So, where does this move, Jim? Where do you see it fitting in to sort of the evolution that we've seen among some Republicans especially?

SCIUTTO: This is a much bigger shift than just Ukraine. Ukraine is one piece of it. And we should note that this is not entirely new, right? This will be the third time Trump and/or Republicans have suspended military aid to Ukraine with impact. The subject of the first impeachment, 2019, Trump suspended it because he wanted to get Zelenskyy to investigate the Bidens. You'll remember the House GOP waited six months to - to add aid, and now we have this again.

And by the way, that six month pause had enormous impact on the battlefield.

BERMAN: That's right, they felt that.

SCIUTTO: They felt it, and it took them a long time to get back to it.

So - so, this is a string that shows you that Ukraine is not a priority for this president and hasn't been for some time. The thing we have to be conscious of, it is not just Ukraine that he is signaling moving away from, it is Europe as a whole. And look at his public comments, right? You - you got to do more on your own, which is a fine position for an American president to take. But the way European leaders are taking this is that the U.S. will no longer protect us. We are on our own. You hear that from the chancellor to be in Germany, right?

BERMAN: Yes.

SCIUTTO: That we cannot rely on the U.S. to defend us. As the U.S. becomes more aligned with Russia and Europe, which is a remarkable statement to make, but these moves together put us closer to Russia's positions on these issues than our own treaty allies. It's a remarkable development.

BERMAN: It really does seem that way.

SCIUTTO: Yes.

BERMAN: At least in terms of negotiating an end to the conflict inside Ukraine.

SCIUTTO: Yes.

BERMAN: Jim Sciutto, great to see you in person. Thanks so much.

SCIUTTO: Thank you.

BERMAN: Kate.

BOLDUAN: Now, as President Trump prepares to address Congress, the American people and the world tonight, we are learning who the first lady will have sitting with her as guests this evening. What those guests can now tell you about the president's message.

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[09:53:35]

BOLDUAN: So, this morning, the White House has just announced the list of guests that will be attending tonight's presidential address along with First Lady Melania Trump. According to the White House, they include the mother and sister of Laken Riley, the nursing student who was murdered by an undocumented immigrant last year. Her death became a rallying cry for Donald Trump during the presidential campaign.

CNN's Betsy Klein has more details for us.

It is always interesting who the first lady brings along with her as guests in her box during a State of the Union, or an address like this. Who else will be joining her?

BETSY KLEIN, CNN SENIOR WHITE HOUSE PRODUCER: Yes, Kate, it's so instructive. Well, President Trump is expected to touch on his accomplishments so far and also preview upcoming priorities. And the guests in First Lady Melania Trump's box really give us a blueprint of what to expect from this speech. Her guests represent a number of key issues, from immigration and border security, to the economy, to culture wars, that the president is likely to highlight tonight.

They include the Comperatore family, the widow and daughters of that firefighter who was killed in Butler, Pennsylvania, during the attempted assassination of Trump. Corey Comperatore, of course, died trying to protect his family during that rally, shielding them from bullets. There are guests representing the administration's immigration and border security policies, including the mother of a 12-year-old girl murdered by two undocumented immigrants during a walk to a convenience store. And as you mentioned, the mother and sister of Laken Riley, that 22-year-old Georgia student killed by an undocumented immigrant while out for a run, will be on hand, as well as Roberto Ortiz, a Border Patrol agent.

[09:55:08]

The president's likely to put a focus on law and order. He will welcome the widow of Jonathan Diller, an NYPD officer shot and killed during a traffic stop. And we should expect the president to highlight his executive action on a major political issue from the campaign, of course, banning transgender women from competing in women's sports. The first lady will host a former high school athlete who, according to the White House, quote, "had her dreams of competing in college sports crushed in a volleyball match when a biological man playing on the opposing women's team spiked the volleyball at Payton's face, leaving her with a traumatic brain injury."

And as the president positions himself as a deal maker with Russia, we will see Mark Fogel, that American teacher wrongfully detained for more than three years in Russia, returning to the U.S. last month after a deal negotiated by the administration.

Kate.

BOLDUAN: Yes, there is a lot there. As you said, very well, Betsy, it's very instructive who joins the first lady as guests on these big moments.

It's great to see you. Thank you so much.

BERMAN: We've had a very busy morning.

BOLDUAN: Yes.

BERMAN: A very jittery morning here.

BOLDUAN: (INAUDIBLE).

BERMAN: As the markets have responded to the new tariffs from President Trump. Canada, Mexico, China all responding. I think we have a live look at the markets right now. You can see the Dow down now well over 1 percent, as with the S&P.

And this follows just giant losses yesterday too.

BOLDUAN: Yes.

BERMAN: There was the hope it would rebound this morning.

BOLDUAN: Well, now we know China, Canada and Mexico are fighting - are slapping - slapping back. And that's what we're seeing here in the markets.

BERMAN: All right, a lot to keep your eye on over the next several minutes.

Thank you so much for being with us. This is CNN NEWS CENTRAL.

"SITUATION ROOM," up next.

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