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Fed Raises Interest Rates 0.25 Percent Amid Stubborn Inflation; Reporter & Pilot Among Three Dead After News Chopper Crash; House Session Ending Early Despite A.I. Concerns. Aired 2-2:30p ET

Aired September 16, 2026 - 14:00   ET

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

[14:00:00]

BORIS SANCHEZ, CNN CO-ANCHOR OF "CNN NEWS CENTRAL": -- limited testing and stigma.

And a Paris court has awarded Kim Kardashian a single euro after being the victim of an armed robbery back in 2016. Her lawyer says that that's how much she asked for. In a joint statement, Kardashian and her stylist who was present during the heist said, quote, "Today's decision is not about the compensation, but accountability and recognition."

Two of the robbers dressed as police forced their way into Kardashian's suite, bound her with zip ties and tape, stealing more than $6 million in jewelry. Eight people were found guilty last year for their roles.

A new hour of "CNN News Central" starts right now.

Rate Expectations, the Federal Reserve just seconds away from announcing a decision on interest rates. It could do something that is likely to make President Trump furious.

Plus, congressional inaction even as tech CEOs call for new regulations to prevent an A.I. disaster. Lawmakers are headed home until after the midterm elections. We're going to speak to a Nobel Laureate known as the Godfather of A.I. about this threat.

And a deeply traumatic day in Los Angeles, a helicopter crash killing three people including the pilot and a reporter. We're following these major developing stories and many more, all coming in right here to "CNN News Central."

With inflation troubles top of mind, the Federal Reserve makes its interest rate decision. The Fed Chair, Kevin Warsh making the announcement just moments ago after facing months of pressure from President Trump. Let's get right to CNN's Matt Egan for the decision. So Matt, what is it going to be?

MATT EGAN, CNN SENIOR REPORTER: Boris, the Fed just delivered an interest rate hike, voting unanimously today to raise key benchmark interest rates by a quarter of a point. Now, this is the first interest rate hike in three years and notably, this is the first hike under Kevin Warsh, the Trump nominated Federal Reserve Chairman. And so this does show that Warsh is willing to back up his tough talk with real action designed to fight inflation, even when the president is demanding dramatically lower interest rates.

Now, this move was widely expected because, of course, inflation does remain far too high and the inflation outlook has actually gotten worse in large part because of higher gasoline and diesel prices. Now, let me read you some new language that was inserted in the Fed statement that helps explain why the Fed took this move.

So the Fed reiterated that inflation remains elevated, but they added in a new line saying that today's policy action will support a timelier return to the Committee's two percent goal. I think that alludes to some frustration over how long Inflation has been well above that two percent target. And the Fed reiterated that the Committee will deliver price stability.

Now, on the job market, the Fed sounded much more upbeat. They reiterated that economic activity is expanding at a solid pace and they said that while uncertainty remains elevated owing in part to geopolitical developments, domestic spending has been resilient. Now, the Fed also just issued some new projections.

Notably, the Fed is penciling in one more interest rate hike this year. However, should also note that there's one official that did not submit an interest rate projection. In the past, Kevin Warsh had said that he was not going to participate in this rate projection exercise, so that is likely him. But now, all eyes will be on Kevin Warsh who's expected to take questions at 2:30 Eastern Time and I'll be interested to hear what Warsh says about what changed, why they decided to raise interest rates when just about two months ago, they decided to keep interest rates steady. And also what he's anticipating going forward in terms of future interest rate hikes. Back to you.

SANCHEZ: Hey, Matt, as we're watching markets, it appears that the Dow is essentially just flat. So that the market presumably was pricing in this rate increase. Aside from what it means for markets, which right now is not much, what does this mean for everyday Americans and their wallets?

EGAN: Well, Boris, it means it just got a little bit more expensive to borrow. In particular, when you're looking at anything that's floating rate debt, it just got more expensive. So think people who are carrying a credit card balance, home equity lines of credit, anything that's adjustable rate in terms of personal loans and student loans, and also going forward, car loans. But the other impact here to our viewers, of course is on inflation itself, right?

Because remember, the reason why the Fed is raising rates is because they're trying to cool off inflation. This is essentially the Fed tapping the brakes on the economy trying to cool off demand and give supply time to catch up. But there's been some debate over whether or not an interest rate hike is even the right move here.

[14:05:00]

Goldman Sachs has said that the economic case for raising interest rates was pretty weak. Other Fed watchers have said the Fed basically had to raise interest rates because the market was pricing it in. Boris, Fed Chair, Kevin Warsh is going to face questions on all of these topics later this hour. Back to you.

SANCHEZ: Matt Egan, we look forward to that. We'll bring it you live, thanks so much.

We're joined now by Stephen Moore, former Economic Adviser to President Trump. Stephen, thanks so much for joining us. How far does this quarter-point rate hike go, with another one penciled in for later in the year, toward fighting inflation?

STEPHEN MOORE, FORMER TRUMP ECONOMIC ADVISER: Well, a couple quick things. One is you are exactly right, Boris, when you said that the market had already priced in this rate cut. That's why you didn't see much of a change in the stock market when that announcement was made. Second of all, so much for the idea that Fed Chairman, Kevin Warsh would not be independent.

Obviously, he's pretty independent when his first move is to do exactly what the president didn't want him to do. As you may recall, Boris, I was nominated in Trump's first term to be on the Federal Reserve Board. I didn't make it through that, but if I were on the board, I probably would have voted for this rate hike.

A tough decision. Now, I want to make sure people understand, the inflation is all driven by one thing. What's that?

SANCHEZ: The war.

MOORE: Oil price. Every morning I get up, the first thing I do is look at what's happening to the world's oil price. So, a rate hike isn't going to bring, you know, the oil price down because that's a global thing. If we can get that oil price down from -- right now, it's at about $105 a barrel last time -- if we can get it back down to, say, $70, you know, then we're going to conquer inflation.

If you look at the report that just came out last week on consumer prices, it was pretty interesting. All the energy prices like gasoline and electricity prices were way up, but all the other prices were pretty subdued. So, it's all being driven by the Middle East.

BRIANNA KEILAR, CNN CO-ANCHOR OF "CNN NEWS CENTRAL": Yesterday, the CBO said the Iran War is expected to spike inflation by half a point for the first quarter of 2027.

MOORE: Wait, say that again.

KEILAR: The CBO --

MOORE: Yeah.

KEILAR: Yesterday said the Iran War --

MOORE: Oh, the Iran War. KEILAR: -- is expected to spike inflation by half a point first quarter 2027. Most of it, obviously, energy costs. Would ending the war be the quickest way to deal with this inflation that we're seeing?

MOORE: So, the problem is nobody knows what's going to happen to the Middle East. I mean, no one knows, you know, what the world's going to look like in January, February of next year. So, it's just hard to predict. This is the -- you know, this is the frustration of the White House. I mean, if I look objectively at the economy and Boris, you just -- most of the other indicators look very positive.

I mean, we just got a report out yesterday from the Census Bureau that showed, you know, record low poverty rates, big increases in incomes. We have a construction boom going on, thanks to A.I. and data centers. Manufacturing is good. It's just this one big sore thumb in the economy, which is this high oil price.

You know, I lived this through the '70s and '80s when I was a kid, and it's just so frustrating, and it's all, you know, driven by the Middle East.

SANCHEZ: Part of the President's anger toward Warsh's predecessor, Jerome Powell, was the fact that Powell refused to drop interest rates. The president has been calling for that to happen. He's suggesting that the U.S. interest rate is among the highest in the world. How do you think he's going to respond to this?

MOORE: I think -- look, I think it was important for Kevin Warsh to do this quarter-point rate increase, because what he said in his brief statement was exactly right. The role of the Fed is price stability. That's all we want. You know, it's not climate change. It's not creating jobs. You make the economy most efficient when you get inflation low and you have a dollar that's stable in price. That's exactly what Kevin Warsh wants to do.

That's why he raised interest rates. Hopefully, you know, you asked me about what happens next year. Hopefully they'll be able to start cutting rates if the oil price starts coming down.

KEILAR: Do you think the White House is doing enough right now to tackle inflation? You know, there's this talk the president has about these $5,000 checks, which would be a massive infusion of cash. Is he doing enough?

MOORE: Look, the U.S. economy is the strongest in the world. No question about it. We're the envy of the world. You know, as I just said, all of these other indicators are very strong. In fact, there are more -- the latest Jobs Report showed there's more jobs available than people to fill them. That's a good problem to have. So, it just -- I keep saying this. It all comes down to oil.

One other point that Trump made, by the way, that is I think a good point that people should consider is Trump was saying that, you know, we're our interest rate on our bonds is higher than a lot of other countries. KEILAR: I think it's a good point you make for people to look other places and say that it's better here. This may be an envious situation compared to some other countries, but you know how Americans feel it.

MOORE: I know.

KEILAR: We're obviously in a critical time politically. They don't say --

MOORE: Because they are looking at the gasoline price every day.

KEILAR: Yeah. That's right. They don't -- and they know how this war began.

MOORE: Yes, they do.

KEILAR: Right? This was a choice by the Trump administration.

MOORE: Now, I agree with that.

KEILAR: So they may say, Stephen?

MOORE: Yeah.

KEILAR: I don't -- I don't really care that you're telling me it's great somewhere else --

MOORE: Yeah.

KEILAR: -- because I'm struggling to pay to get to work. I mean --

MOORE: You are right. I mean --

KEILAR: What does the Trump administration need to do about that?

MOORE: I've always said, in my 35, 40 years of being economists, you know, what is the one first gage we look at on the economy? The gas price.

[14:10:00]

You know, people are in a good mood when the gas prices are low. They're a bad move where they're paying $4.25 a gallon. So you're right about that. The question is, what can the administration do at this point to bring the prices down? I mean, I'm not an expert on this. There's no shortage of world oil. You know, if we could get the Strait of Hormuz open, the price would fall very dramatically.

So it's a frustration and I agree with you. People are angry about food prices and gas prices.

SANCHEZ: You didn't say the solution was $5,000 checks, notably.

(LAUGH)

MOORE: I'm not a big fan of that proposal, let's just say that. But yeah, right now, it's not. You never create growth by sending out checks to people.

KEILAR: Some people might be a fan of a $5,000 check right now.

(LAUGH)

KEILAR: Steve, great to have you.

(LAUGH)

MOORE: Great to see you.

KEILAR: Thank you so much.

Still ahead, more on the decision to raise these interest rates. We're standing by for the Fed chair to speak. Plus, a veteran pilot and a news reporter among the victims of a deadly helicopter crash in Los Angeles. CNN is live on the scene with the latest details.

SANCHEZ: And House Speaker, Mike Johnson sending lawmakers home early despite a push to stay in session to tackle concerns about A.I. That and much more coming your way on CNN.

(COMMERCIAL BREAK)

[14:15:50]

KEILAR: A.I. insiders are warning the technology could trigger the end of humanity. Industry leaders are calling for a slowdown in development, and top CEOs are welcoming independent oversight. If there was a time to act, it appears it would be now. And yet, Congress is heading home early for a weeks-long recess and is not scheduled to return until after the midterm elections, meaning any potential federal regulation of A.I. won't happen until then either.

SANCHEZ: Yeah, OpenAI CEO, Sam Altman, who's backed the idea of third-party watchdogs, says he understands why people are worried, but believes that A.I. labs can be trusted.

(BEGIN VIDEO CLIP)

SAM ALTMAN, CHIEF EXECUTIVE OFFICER, OPENAI: I am very confident in our company's ability, our industry's ability, to do this safely, to make sure that we keep alignment and safety and monitoring way ahead of capabilities to slow down or stop if we get to a point where we can't. But I'm disappointed by how it's been framed.

(END VIDEO CLIP)

SANCHEZ: Joining us now to talk about all of this is the man considered to be the Godfather of A.I., Geoffrey Hinton. His research paved the way for how today's A.I. systems function.

Geoffrey, thank you so much for being with us. Let's talk about these efforts by lawmakers to pass some form of A.I. regulation. There have been more than 100 bills introduced in Congress to regulate A.I. over the past two years. None of them have actually passed. We want to talk through some of these proposals before Congress right now and get your reaction as to how effective they might be.

First, this bill that, among other things, requires top A.I. companies to allow independent verification organizations into their companies to make sure that their models are being developed safely. Do you see that as potentially effective?

GEOFFREY HINTON, COMPUTER SCIENTIST & PROFESSOR EMERITUS, UNIVERSITY OF TORONTO: Yes, I think that's a very good idea. It's not the solution to everything, but it's a start.

KEILAR: Why is that? Why is that a good idea?

HINTON: Well, at present, we've relied essentially on whistleblowers saying how things went rogue. And if you look at the Hugging Face incident, it was reported by people in the companies, some of whom left. But we need much more monitoring of that kind of thing.

If we're going to get these swarms of rogue AIs conspiring with each other to break into other companies without the organizations knowing it's happening, we need people inside those companies who can say what's going on.

KEILAR: Next is this A.I. kill switch bill. So that has companies with the ability, right, A.I. developers, they can do the killing. They throttle or they can suspend, they can shut down their A.I. Then you have, though, DHS authorized to basically make the call on this. So they do have the control in that.

What do you think about that possibility?

HINTON: I don't think it'll work in the long run. So there's a whole bunch of different risks of A.I. There's the risks that come from bad actors using A.I. to do bad things, like cause mass unemployment or create nasty viruses or do nasty cyber attacks or make videos for corrupt elections.

But then there's a different kind of risk, which is A.I. itself getting much more intelligent and taking over, A.I. taking control. A kill switch is no good for that because the A.I. will be much better than people at persuading people of things. It's already comparable with people at persuading you of things.

When it's super intelligent, it'll be much better than people. So it will be able to persuade the people in charge of the switch not to pull the switch.

SANCHEZ: So to that point, Senator Bernie Sanders proposed a ban on super intelligence, a pause as well on the deployment of advanced A.I. models until regulators have developed more guardrails, so to speak.

What are your thoughts on the idea of pumping the brakes on super intelligence? Is that something that can still be done at this point or is the genie out of the bottle?

HINTON: I think it's a good idea. For example, for super intelligence, we have no idea how we can stay in control or how we can get it, even when it's in control, to like us still and be nice to us.

(LAUGH)

HINTON: So it seems very stupid to develop that before you know whether it's going to turn out nicely. For that reason, we should certainly slow down the development of super intelligence.

[14:20:00]

Slowing down the rest of A.I. is going to be difficult. The A.I. companies would like you to have a model -- A.I. is like a car and innovation is like the accelerator. A.I. development is like the accelerator, and regulation is like the brakes. So they want to sort of phrase regulation as a bad thing that slows everybody down.

A much better model is development of A.I. is like the accelerator, and regulation is like the steering wheel. They want us to develop a very fast car with no steering wheel, and that's a bad idea.

KEILAR: We can see how that would definitely be a bad idea. So, is this whole conversation about regulating in America, is it pointless without a global initiative, without an agreement with China?

HINTON: So we will get, I say we. I used to think of North America as one thing, but of course I'm from Canada, and I no longer think of it as one thing.

(LAUGH)

HINTON: We will get agreement with China on some things. Both the Chinese Communist Party and the countries in North America don't want terrorists being able to create nasty viruses easily. They don't want terrorists being able to do cyber attacks easily, and they particularly don't want A.I. taking over. So on that issue of, should we slow down the development of super intelligent A.I. until we know how we can control it, they're aligned, their interests are aligned.

So parties will collaborate when their interests are aligned, and they won't collaborate when their interests are anti-aligned. On things like fake videos for corrupting elections, the interests are anti- aligned because all the countries are doing it to each other. But on things like preventing A.I. from taking over, no country wants that. The Chinese Communist Party doesn't want it. The democracies don't want it. America doesn't want it.

And so everybody can agree on that. The question is can they do something in time?

SANCHEZ: You said something earlier that was fascinating and raises all sorts of philosophical questions as well, about super intelligence and getting it to like us. I want you to expand on that because at some point, we're going to reach a point of no return where this thing is just going to sort of build itself. In some ways, it already is, right? It's helping to develop its own future.

So what do you mean by super intelligence liking us? Is that possible? Are we headed toward Terminator?

HINTON: If you look around and ask what examples do we have of a more intelligent thing being controlled by a less intelligent thing? There aren't many out there, right? We don't notice that much because we're the apex intelligence on this planet. But there is one example, which is a baby and a mother.

In a sense, they're both in control. The mother is in charge, but the baby can control the mother by crying, for example. The mother just can't bear the baby crying. We need to develop -- since we're building this super intelligence, we're designing it, we need to develop it in such a way that it likes us more than it likes itself, and in such a way that even though it's much smarter than us, it wants us to realize our full potential. That's my belief.

I think that's a better approach than thinking, how do we always keep this smart thing under our thumb. I'm not sure we can do that.

SANCHEZ: Would you say that you're an optimist when it comes to these issues?

HINTON: No.

(LAUGH)

HINTON: I'm hopeful.

SANCHEZ: Yeah.

HINTON: But I think we're at a very delicate point in history where what we do now is going to determine our future. One thing we should be doing now is putting a lot of resources into figuring out how we can co-exist with super intelligent A.I.

SANCHEZ: And we're glad to amplify voices like yours. Geoffrey Hinton, thank you so much for joining us.

HINTON: Thank you for inviting me.

SANCHEZ: Of course. Still plenty more news to come this afternoon, including this Los Angeles T.V. station grieving the loss of two colleagues. After the break, we're going to take you live from the scene of last night's news helicopter crash with the latest on what happened.

(COMMERCIAL BREAK)

[14:28:32]

KEILAR: A Los Angeles newsroom is mourning the loss of two colleagues killed while covering a story from the air last night. A helicopter pilot and reporter for KABC and Telemundo 52 were killed when their chopper suddenly crashed as the two were reporting on a bus collision.

A person in a parking lot also died, and at least two others were hurt. You can see the aircraft was so damaged that investigators could not make out the tail number. Video from a live stream of the chopper captured the moment that it appears to suffer some sort of problem and begins to fall, and a warning that this footage may be distressing to see.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: You can't pull up?

(END VIDEO CLIP)

KEILAR: CNN's Julia Vargas Jones is at the crash scene there in Los Angeles. And Julia, we understand NTSB investigators are there now.

JULIA VARGAS JONES, CNN CORRESPONDENT: Yes, that's right. They said, Brianna, that they are on the scene now. We saw some action here behind us. This is the location of the crash behind me in this very industrial part of Los Angeles, about 25 minutes from downtown L.A. Of course, we don't know yet the cause of this crash.

All we know is that from the video from inside that helicopter, there was sound of the engine losing power and then an alarm that went off telling the pilots that the main blades were now slowing down --