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Smoke Billowing from Sistine Chapen Chimney; Black Smoke Billows from Sistine Chapel Chimney; No Pope Elected; No Pope Elected in First Round of Voting at the Conclave; Fed Holds Interest Rates Steady Amid Trump's Trade War. Nuclear Powers India and Pakistan at Risk of Wider Conflict. Aired 3-3:30p ET

Aired May 07, 2025 - 15:00   ET

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

(COMMERCIAL BREAK)

[15:00:54]

BRIANNA KEILAR, CNN HOST: All right. We have some breaking news. There is smoke coming from the chimney there in the Vatican. You may think you know the color of it. We are not committing ...

ERICA HILL, CNN HOST: No.

KEILAR: ... to the color of this. We know better. So, we are going to wait until we have the official announcement. It is nighttime there in Vatican City and we need to make sure that we have the right call on this to see whether there will be another round of voting as these Cardinals are trying to determine who the next Pope will be.

HILL: CNN's Erin Burnett is live in Rome for us at this hour.

Erin, bring us in. I imagine, too, you heard a bit of a movement behind you in the crowd as that smoke was seen for the first time.

ERIN BURNETT, CNN HOST, "OUTFRONT": A lot and this is - it's been incredibly delayed, but it does appear as I'm here with Christopher Lamb, our Vatican correspondent, it does appear this smoke is black as it had been anticipated to be no pope heavy with the coal.

CHRISTOPHER LAMB, CNN VATICAN CORRESPONDENT: Yes.

BURNETT: No pope. They - I don't know if they thought - nobody here thought that they were really going to get a pope, but this is incredibly delayed.

LAMB: Yes.

BURNETT: It's certainly compared to last time and compared to any expectation were over an hour outside the window of when we had anticipated a vote. So much so people were wondering if they even did vote.

LAMB: Yes.

BURNETT: But this is black smoke. There is no pope. LAMB: Yes, that's right. That's - it's clearly black smoke. This is what was expected tonight There was only - we understand - one round of voting. Of course, there are a hundred and thirty-three Cardinals in there which is more than there was in 2013. It will therefore take them longer to do their balloting and voting.

And, of course, they also had a meditation before voting from a cardinal who is known to preach for quite a long time.

BURNETT: For boost shall we say?

LAMB: Well, possibly but maybe he wanted ...

BURNETT: Eloquent?

LAMB: ... well, he likes to go on quite a long time and so that may also have delayed the votes.

BURNETT: Yes, although - and now you can immediately see this crowd moving. Everybody had waited. At - the numbers that we had just had, Brianna and Erica, were that there were 30,000 people - this is from Rome police - 30,000 people in this square and they waited, and they waited, and their phones were ready. There'd be a little clap that would occasionally go up, the phones would go up to see if they could, you know, film the smoke. And now everyone in a very orderly way going home.

The last time there was a conclave though. This came an hour and 20 minutes earlier. There are 20 more Cardinals this time than last. So, as you're pointing out, we don't - you have no - we have no idea what to read into this. It could have been a long meditation. It could have been that combined with more cardinals. It could be more debate. We just don't know.

LAMB: Well, I think it also takes them a while to get up and running. They have to get used to voting. There - you know, there's obviously sometimes there could be procedural things that go wrong. Someone could put in a blank ballot, which would mean they'd have to do it all over again. So, there are things that could mean that there are delays.

I imagine that once they get into the swing of things, they'll start to speed up a bit with the process.

BURNETT: Yes, with the votes. And we - there will be votes tomorrow morning, two of them. Then there will be two more votes in the afternoon. Of course, on the first votes tomorrow, if there is no pope, we won't know if the votes happened. We'll only know when we see the smoke that the second vote that has occurred.

LAMB: That's right. That's right.

BURNETT: Unless there is a pope on the first. So, here's what we know, we know they voted. We know they didn't have a two-thirds majority. We have no idea how many People are truly top contenders. We - they know that right now. LAMB: Yes.

BURNETT: Things have changed.

LAMB: Sure.

BURNETT: Things have changed in the open now because they know the number of votes for each person. And that dramatically can shift things, right? But we are in the dark. They are not.

LAMB: That's right, but I think we know from previous conclaves and the reporting on them that's emerged over the years that the first vote is Crucial because it's the moment that people put their cards on the table.

[15:05:00]

You know, will the frontrunners have as many as people expected, will there be an outsider candidate who suddenly got support, will there be surprise ...

BURNETT: Yes.

LAMB: ... candidate who suddenly got maybe not a lot of votes, but a number of votes and that can suddenly shift the thinking.

BURNETT: Yes, suddenly since - oh, wow, that person. David Culver, we've been watching you from where we sit. I don't know if you saw us, but we saw you amongst the crowd which is now 30,000 strong in an orderly way getting ready to leave and I presume many of them come back tomorrow morning.

DAVID CULVER, CNN SENIOR NATIONAL CORRESPONDENT: And Erin, you had that big sigh of disappointment all at once. I don't know if you caught that, but they have the big monitors and what happened just before black smoke is all the monitors went out. And so, folks seem disappointed that perhaps there wasn't going to be a voting result through the smoke that they were expecting and then suddenly they came back on and we saw the black smoke.

In the lead-up to that, and you can see as we're looking around here, all these people are now getting off St. Peter's Square. But we had people coming up to us asking, hey, do you know what's going to happen. This is pushing rather late. Any idea what's going on.

Obviously, we have no connection with what's going on in there. They're totally sealed off. They have (INAUDIBLE) really what's happening out here. But what we're now seeing is people who are leaving looking at us saying with a smile, some locals, it's okay, we expected this. We'll be back here tomorrow.

And it seems to be the process. It's interesting to see folks who are visitors and there have been a few who have said that they're only here for a select period of time. That maybe they have a cruise. One couple told us that they were going on to and so they were hoping that maybe today would coincide with the time that they're here. And a different sentiment from locals, who obviously we'll go back to work tomorrow and we'll make their way here around the same time once again, just to see if perhaps there will be a result, but you do have still this uplifting atmosphere.

The other thing I'm going to point out (INAUDIBLE) interesting to me to just to see large crowds like this is the incredible police presence. I mean, security here and there have been a lot of undercover police as well who've just been making their way through the crowds and you'll notice they'll have badges on that they wear under their jackets. There is a very intense security presence.

They're not checking bags or anything like that, but they are certainly vigilant and they've been walking through (INAUDIBLE) and even today at one moment the Italian police, the Roman police here in the city, stopped and looked up. They're taking pictures themselves wanting to take in what was a non-vote or rather a non-win for this first day of the conclave.

But still, it's meaningful for them. It gives you a sense of just how many folks in this area are impacted by this.

BURNETT: Yes. It is truly amazing and to see the St. Peter's Basilica lit up, you see the darkness. Although when you actually see the chimney above the Sistine Chapel, it is almost a, you know, a sepulchral sort of a light, that backlit light where we could so clearly tell that the smoke was black, Fr. Beck. And later than we thought this would be, certainly from the past and from the expectation of the smoke windows, probably later than many of the cardinals thought that they would be in that room. They now have to go to Casa de Marta, they have to have dinner, Fr. Beck. They have to, I'm sure they'll be conversations then, and then they are up early in the morning and back in to vote again.

REV. EDWARD BECK, CNN VATICAN ANALYST: That's right. And it's kind of not surprising that it took a little bit longer. I mean, there are 20 something more Cardinals than last time. Remember there's 133 of them.

They also I think might want to dispense with picking scrutineers for each election. I mean, the same people who are scrutineers are not scrutineers tomorrow and they draw lots again of who's chosen for the six scrutineers. So, there's probably ways that they could expedite it if they felt it went long. But now they'll go back as you said and have dinner and there will be some informal conversations based on what they just did.

Now, remember, this first vote is usually very scattered and the cardinals disguised their handwriting. They're actually told to disguise their handwriting and they say it so that it's secretive, but also the truth is that some of them vote for themselves the first time, even though they claim they never would. But I have heard ...

BURNETT: Yes.

BECK: ... from good sources that a few vote for themselves the first time. But you get the lay of the land, you see where people are going, where they're not. Now, maybe the person who got the most votes tonight, tomorrow made you better and then it could expedite it. But it was really scattered and there was no clear majority, or not majority but at least, you know, more votes.

Then, we could be in for a longer conclave. Remember, the complex nature of these cardinals is very different from before.

BURNETT: Yes. And it is amazing as you point out, it's things like picking the scrutineers and the people who are going to actually count the votes and then the people who will recount the votes to check the count.

[15:10:07]

The fact that something like that is done every day, I suppose we'll see if that is something that ends up changing. But the disguising of the handwriting and voting for themselves. And, of course, we don't know and probably will never know this vote. Maybe the "Conclave" movie is the closest so many of us will get to ever being inside of that room.

All right. I want to bring Kurt Martens into the conversation now, a professor at the School of Canon Law at The Catholic University of America. And Professor, what's your reaction to this? Again, we were waiting, the crowd here was waiting. There was - I don't want to use the word impatience because there was not frustration, but there was eager anticipation that had been denied and they wanted a vote. And it was significantly later than had been anticipated. What do you read into that?

DR. KURT MARTENS, PROFESSOR, SCHOOL OF CANON LAW AT THE CATHOLIC UNIVERSITY OF AMERICA: Nothing. Actually, it was very funny. One of my colleagues was texting me and said, maybe they'd picked someone from outside the Conclave and they have to smuggle him in. So, I said no, because actually I was expecting it to be a little bit later, not only because of Father or Cardinal Cantalamessa, who has a tendency to preach long, but also the - taking the oath took forever as they entered into conclave, much longer than last time around.

And then they have to - each of them has to move forward to the altar, come forward to the altar to cast their ballots. If you have 135 middle aged men or older than that come forward, it's not like you have 20-year-olds running up to the altar. So that takes time.

Then, they have to indeed pick the scrutineers, then count - they have also to pick the revisers to make sure that the scrutineers did their job, et cetera. So, it's a lengthy process and you have to do that with 135 ballots.

I'm actually expecting, if the news is correct, that one of the cardinals is too ill to come every day to the Sistine Chapel and he stays at Santa Marta, you will have to have three Cardinals, they're called infirmarii (ph), to go to Santa Marta from the Sistine Chapel to have him cast his vote, pick that up, bring it back to the chapel, have it mixed with the ballots that are collected in the chapel and then count it. So be patient and extend your airtime a little longer. BURNETT: Yes. Yes, I know - and the crowd waiting, as we said, about 30,000 strong who were waiting, Professor, for that and now are dispersing, likely to come back tomorrow. Look, we, as Fr. Beck said, it is often - he sees the first round as, you know, very scattered, you really - but you get the lay of the land of who are front runners, how many are under consideration. Is there someone who is quite surprising to everyone even in the room that got more votes than anyone would expect, even if that wasn't a lot of votes.

As you see it, how many sort of front runners do you think they could be looking at coming out of tonight?

MARTENS: That's hard to predict. We're not in the room, but actually today is the first moment of truth because they have been talking. There were some rumors cardinal so-and-so has secured 40 votes, 50 votes. It's like with opinion polls prior to an election, the only election that matters is when someone casts a vote.

And so today was the - what I would call an indicative vote. You see where the cards are on the table. And then it's going to be interesting to see, first of all, what they do during the conversations. Is there someone who we weren't talking about? Who of the front runners has picked up a lot of votes?

And then tomorrow, what's going to be very crucial for those who have a lot of votes, are they able not only to keep their votes, but also to increase? If they're - if that stalls at some point, the votes are going to shift to another candidate. Because if someone is not able in a few rounds to go up and get closer to the two-thirds majority, that means he's not able to get it and so they're going to switch to someone else.

BURNETT: Truly amazing that all this happens in ways that we will never truly know. Professor Martens, really appreciate your time and thank you.

And our breaking news continues. An hour later than had been expected, an hour and a half almost after it happened last time around, we have our first vote here at the Vatican. Black smoke. The cardinals have voted in their first vote for the 267th pope. And tonight, there is no pope. Stay with us.

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[15:19:09]

KEILAR: The Federal Reserve standing pat on interest rates amid the economic uncertainty brought on by President Trump's trade war and despite intense pressure from the President himself. For now, the Fed unanimously voted to hold rates steady. Fed Chair Jerome Powell, speaking about the decision moments ago, said that if the proposed tariffs stay in place, it could hurt the economy.

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JEROME POWELL, FEDERAL RESERVE CHAIRMAN: If the large increases in tariffs that have been announced are sustained, they're likely to generate a rise in inflation, a slowdown in economic growth and an increase in unemployment.

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KEILAR: Let's bring in Aaron Klein. He's a former Deputy Assistant Secretary at the Treasury Department, now a Senior Fellow of Economic Studies at the Brookings Institute.

Aaron, thank you so much for coming in to talk with us about this.

Okay, Powell did not mince words here. He said the tariff increases and now so far have been significantly larger than anticipated.

[15:20:04]

I think that sort of reiterates some of what we've heard before, but a little stronger. If the large increases in tariffs that have been announced are sustained, if they keep going, they are likely to generate a rise in inflation, a slowdown in economic growth and an increase in unemployment. What did you think?

AARON KLEIN, FMR. DEPUTY ASST. SECRETARY, U.S. TREASURY: Yes. I mean, look, tariffs are a problem for the Fed. The Fed has a dual mandate to keep people employed and to keep prices stable and low. And the way that they think about it, they think there's some sort of trade-off between unemployment and inflation.

And what tariffs do is they make both situations worse. So, what you see in the Fed statement is this possibility of stagflation, that if the tariffs come in, unemployment's going to rise and prices are going to rise. And this creates a conundrum for the Fed, because they don't know how to respond, what should I focus on. And they're screaming as loud as they can, please don't go through with these tariffs.

KEILAR: And talk a little bit about how tricky stagflation is in - I mean, this is - it's almost like a wicked problem to deal with economically.

KLEIN: Absolutely, particularly for the central bank. Look, the Federal Reserve is not some grand wizard that can control the entire economy, right? They set an interest rate. That interest rate has consequences. It takes a long time for those interest rates to move.

Markets move immediately, but the actual effect on the real economy takes six months to a year. The way that I always analyze it is if you're driving, imagine whether you have to step on the gas or the brake, but you have to decide that two miles down the road. What you hit today doesn't move the car for then and that's what they're dealing with.

And so, that's - what's not only killing them is that the magnitude of these tariffs and the direction of what they hit, but the uncertainty about whether they're going to happen. You know, Trump's maybe so, maybe not tariffs, make it very confusing for the Fed to know as to what to do. Are there going to be tariffs? Are there not going to be tariffs? And Trump himself stokes the uncertainty, right? Come to me and we'll negotiate a deal, right?

By putting himself center place, by increasing this uncertainty, which is the other thing you heard out of the Fed today. Uncertainty is slowing the economy and making the Fed's job harder to do.

KEILAR: After some recent tension between Trump and the Fed, I'm very understated as I see that recent tension. This question a lot of people have asked of could the President try to fire Jerome Powell? He seemed to dismiss that idea, right? What did you think about that? Where are we in that relationship?

KLEIN: Right. So, Trump could try to fire Powell. He could do anything. And we've seen him be very aggressive in what he could do. The reality is Trump talks a tough game, but he actually cowers in fear at markets, right? If Trump thought he could fire Powell and get away with it, he would. But markets would crash, and ultimately Trump is too afraid of the markets. He's willing to tell Americans, I'll cause a recession, which he'll blame on Powell. He'll blame the recession on everybody but himself. But he knows the tariffs could cause a recession, but it's in a larger cause.

What he's not willing to do is to test the market reaction of what would happen if he'd fire Powell. So, Trump's kind of wimped out right now in terms of taking on the Fed, and Powell knows it.

KEILAR: What did you think about Powell saying that the Fed might have waited too long to start cutting rates last year in response to inflation?

KLEIN: Yes. Look, the Fed has a little more humility now under Powell than it has in the past, and I think that's good for the institution. I think for too long, the Fed has been frankly a little bit arrogant in assuming that its decisions were always right. And look, I have some sympathy for them in monetary policy. It's difficult to know. In hindsight, decisions look a lot easier.

But here the Fed is caught because it doesn't know whether to raise or lower rates now because it has a very cloudy outlook on the economy, because Trump has created all this uncertainty about tariffs, one, if he goes through with it; two, it's going to make their problem - the economy worse for them in either direction. If they lean on stimulating the economy to combat the slow growth that tariffs cause, then that's going to make inflation even worse.

If they lean on trying to keep prices down because inflation is going to raise prices in the short run, then it's going to make unemployment even worse and the economy slower. They're betwixt and between. Trump has them in a hard spot.

KEILAR: Betwixt and between, not the place one wants to be.

Aaron Klein, thank you so much. It's always great to have you explain all this.

KLEIN: Pleasure to be here.

KEILAR: Thank you.

Still ahead, India and Pakistan could be on the brink of a wider conflict as tensions further escalate there. Global leaders are urging restraint from both countries.

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[15:29:11]

HILL: Pakistan is vowing revenge after India launched a series of airstrikes claiming it was targeting terrorist infrastructure. India says the assault was in response to last month's deadly shooting rampage inside the disputed border region of Kashmir. Dozens of mostly Indian tourists were killed in that attack. Pakistan has denied any involvement. Fears, though, are mounting that today's attack could severely escalate tensions.

This afternoon, Pakistan's prime minister said India made a terrible mistake and went on to say they, quote, now have to pay the price. World leaders have been urging both sides to de-escalate. Joining me now to discuss Leon Panetta. He's former defense secretary, of course, former CIA director as well, under President Obama.

Always good to have you with us as we walk through this.

What I think is on a lot of people's minds is the fact that both India and Pakistan do have nuclear capabilities.

[15:30:03]

What is your level of concern that either would turn to those?