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Financial Crisis Committee Probes Derivatives;Hurricane Alex Nears Land
Aired June 30, 2010 - 11:59 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
TONY HARRIS, CNN ANCHOR: Hello again, everyone, I'm Tony Harris. Top of the hour in the CNN NEWSROOM, where anything can happen.
Here are the big stories and the people behind them. Hurricane Alex steers toward the Mexico/Texas coast this hour. The storm stirs big waves that interrupt oil clean-up in the Gulf.
Oyster boats get a green light to return to one stretch of Gulf water. But fishermen worry about what the oil and chemical dispersants may have done to the crop.
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UNIDENTIFIED MALE: That's the big question mark. Will it have an impact? Yes. To what extent? We don't know.
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HARRIS: You're online right now, and we are too. Ines Ferre is following the top stories trending on the Internet -- Ines.
INES FERRE, CNN CORRESPONDENT: Tony, check it out. It's called car surfing and some teens are doing it in California, causing a lot of controversy.
Also, trending on Google and on CNN, Larry King announcing he'll be hanging up his suspenders soon -- Tony.
HARRIS: All right. We will get to that story in just a moment.
But let's get to our lead story right now: Stocks are trending a little higher today, right? Up and down and then up again -- one day after fears of a double dip recession spooked investors, they resulted in a big 268-point loss.
Right now, stocks are in positive territory, up 28 points. In the last five days, the Dow Jones Industrial Average is off 4 percent. For the year, 6 percent.
Past executives from meltdown firm AIG are the guests of honor today. The president's Financial Crisis Commission wants to know all about those super risky derivatives at the heart of the collapse. The CNN money team is all over this.
Christine Romans is covering this story.
Christine, let's start with something of an explainer. What's a derivative?
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: What is a derivative? Oh, Tony. Please.
Derivative is at the heart of this whole mess we have ourselves in, and the derivative we're talking about here, it's not like a stock, something that's a shared company that you can buy and sell, and you're buying and selling actual stake in the company. This is -- this is a derivative of a stake in a company or a stake in a certain financial instrument. It is basically a bet, a contract between two people -- if something goes up, I'll pay you this; if something goes down, I'll take this or pay you this.
So, these derivatives got so complicated, Tony, and were the heart of the insurance and banking crisis that nearly took down the global economy.
HARRIS: So, what is happening today? What's happening with Capitol Hill? And what do lawmakers -- what questions are they asking and wanting answers to?
ROMANS: Well, what they're trying to find out is the relationship between AIG, Goldman Sachs and complicated derivatives.
HARRIS: Yes.
ROMANS: And the man who ran the division that was at the heart of the problem for AIG, a man named Joe Cassano who we will hear from today for the very first time. He's been the subject of two federal investigations, been cleared of any wrongdoing. But in the eyes of many, he is the one who ran the division that ran AIG into the ground because of some of its risky bets.
He, in his prepared testimony, is vigorously defending himself, Tony. But the bottom line here is that when he was running the financial products division of AIG, AIG was getting itself in a whole lot of trouble -- trouble that resulted in a total bailout of $182 billion and a projected loss to taxpayers of $36 billion.
He has not started speaking, Tony, but he will be the star today of this hearing as will an executive from Goldman Sachs.
HARRIS: So, we need some real fact-finding today. And if the questioning is good and strong and insightful, we will learn a lot about what happened with AIG, right?
ROMANS: We could. And here's the thing: this hearing, this Financial Crisis Inquiry Commission, it's not -- this is not a political commission.
HARRIS: Yes.
ROMANS: These are not Congress members who are facing -- right? They're not facing re-election or they're not facing midterm elections.
HARRIS: Yes.
ROMANS: These are people who their only job is to get to the bottom of it and present the president with a fair report about what went wrong and recommendations to make sure it doesn't happen again. That report by December 15th.
So, you're seeing a very pointed and smart questioning -- not that other congressional hearings aren't pointed and smart. But you're seeing pointed and smart questioning to get the bottom of all of this.
And to date, the probing of -- you know, they've talked to Warren Buffett, they've talked to other -- they've talked to other executives of different companies involved in this whole crisis. To date, the probing has been -- has been pretty fair balanced and they're smart. They're smart getting to the bottom of what's been going on.
So, I'm hoping that we're going to have some good stuff later this afternoon.
HARRIS: Yes, let's do pointed -- let's smart without the political posturing. That would be a welcome change.
ROMANS: Right.
HARRIS: All right, Christine, good to see you. Thank you.
You know, a compromise has sort of stumbled a bit here. The Senate Democrats are scrambling right now to save the historic financial reform bill. They're two votes short after the death of Senator Robert Byrd and a revolt by Massachusetts Republican Scott Brown. He forced lawmakers to come up with another way to pay for Wall Street reform. Brown balked at a last-minute tax on big banks and hedge funds.
What exactly would the reform mean to you, the consumer, if Congress ever gets it finally approved?
Ines Ferre is here with that story -- Ines.
FERRE: Yes, Tony, it deals with so many things that you as a consumer get your hands on, like a loan, like a mortgage. So let's take a look.
One of the things that this reform would do is create a consumer agency inside the Federal Reserve, and that agency would set rules against unfair practices dealing with consumer loans and credit card. Now, this wouldn't apply, though, to auto loans. You'll also be able to see your credit card score for free, if it impacts you negatively. And what that would do is, if, for example, you can't get a loan, you'll be able to see that credit score for free.
And now, also, when you go to a store and merchants love for you to pay in cash.
HARRIS: Yes.
FERRE: That way we don't have to pay what are called interchange fees when you use a credit card or debit card, and with this bill, the fed would put a cap on debit card swipe fees. And what it will also do is, speaking of fees, $10 minimum on purchases with your credit card. So let's say you're one of those people that goes to the store and likes to buy a pack of gum with a credit card --
HARRIS: OK. Yes.
FERRE: -- well, merchants will be able to set a minimum, no more than $10 for purchases.
And also, a ban on "liar loans" -- and these are those loans that got the banks in trouble. Now, lenders will have to verify incomes and assets, as simple as it sounds, Tony.
HARRIS: All right. There is a lot there that can impact you. All right, Ines, good -- appreciate it. Thank you.
The Texas coast is getting ready for a hurricane. Alex is expected to slam ashore along the Texas/Mexican border just hours from now, ahead of the Atlantic season's first hurricane. Tourists and Texas coast residents are heading for higher ground. South Padre Island, as you know, a popular tourist spot, is pretty much deserted right now. The storm has also disrupted efforts to clean up and contain the oil leak in the Gulf.
Chad Myers is tracking Hurricane Alex for us.
And, Chad, if you would, sir, what's the latest?
CHAD MYERS, AMS METEOROLOGIST: I think it wobbled to the right. And I think it might take longer to get to the coast than it looked like two hours ago.
HARRIS: OK.
MYERS: And these things do wobble back and forth. That does not mean that the storm turned to the right and it's going head to Corpus Christi or on that matter, it's going to head to New Orleans. OK, that just doesn't happen.
But if you look at the center of the circulation here, which would be considered an eye, I believe most of the night, it was traveling almost due west, and just in the past couple hours, it has turned a little bit off to the -- just to the north here, just a little bit.
Let me zoom in here. We do have this tornado watch here, and the Texans are saying, "That ain't a tornado."
HARRIS: Yes.
MYERS: That's a water spout. Get over it. OK?
So we're not going to see F-3, 4, 5s with this. But you could see a water spout coming on shore, and a 100 miles per hour water spout over your house ruins your day. So, just keep that in mind. But there's the center, there's the eye, and I believe you see a little bit of a northward drift. I expect the westward drift will continue and landfall will still be south of Brownsville, Texas, as we described.
But look t the size of this, Tony. This really has filled up the Gulf of Mexico here.
HARRIS: Oh, yes. Yes.
MYERS: We had showers in Atlanta from one of the kind of outer feeder bands yesterday and all the way into Baton Rouge like Charles all the way to the parishes of Louisiana, seeing some heavier showers at this hour, all the way from Yucatan Peninsula with this bright banding all the way to New Orleans.
And winds now are 80 miles per hour. Gusts could still get higher before we get to the landfall. And storms only get bigger when they are over water.
HARRIS: That's right. Yes.
MYERS: So, the closer they get to land, and the closer they get to land, not only is it -- when the eye goes over does it start to die, but if it starts to gulp in dry air from the mountains, it can also begin to die off.
HARRIS: Thank you, sir.
MYERS: I'll be here.
HARRIS: All right. Thanks, Chad.
On Capitol Hill this hour, the Senate is set to vote on confirming General David Petraeus as the top U.S. military commander in Afghanistan. And I understand the vote is underway right now. Petraeus would replace General Stanley McChrystal. McChrystal, as you know, resigned after he and his staff were quoted in an article, criticizing and mocking administration officials.
The hearing on confirming Petraeus was dominated by debate over plans to begin withdrawing U.S. troops from Afghanistan in 2011. Expect General Petraeus to be confirmed.
More than 1,800 veterans possibly exposed to HIV or Hepatitis at a V.A. hospital.
Our senior medical correspondent, Elizabeth Cohen, joins me shortly to explain how this happened and how you can protect yourself if you received one of those letters, what do you know now.
First, though, a "Random Moment," a tribute in 90 seconds.
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HARRIS: Boy, our "Random Moment." Six-time Wimbledon champ, Roger Federer, the great one, the Sweet Swiss, classy in defeat -- and our "Random Moment of the Day."
Czech player, Tomas Berdych, right? None if this as much of a stunner as many want to believe, but he beat the number one all-time, dismissing Roger Federer in the Wimbledon quarterfinals. Score is not important here.
As you know, Federer has won 16 grand slam titles, the record for men. He is currently ranked number two in the world. Yes, this has been a Wimbledon of upsets. With Federer nearing his 30th birthday, we may be seeing the end of a golden era in tennis.
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HARRIS: Live pictures now in Capitol Hill. The vote to confirm General David Petraeus to be the top U.S. commander in Afghanistan, we understand is going on right now. You know, there are a few certainties in life, isn't that right, Elizabeth Cohen?
ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: A few.
HARRIS: A few.
COHEN: A few.
HARRIS: This is one of them --
COHEN: OK.
HARRIS: -- that General Petraeus will be confirmed. We will watch this vote, expected to come in shortly.
And the military is having to answer for mismanagement at Arlington National Cemetery. An army report early this month confirmed the remains of hundreds of the nation's fallen heroes have been mishandled. Burial records are missing, graves unmarked, and urns put in a spillage pile. The House Armed Services Committee is hearing from Army Secretary John McHugh. He testified that the military is doing everything possible to right the wrongs. But the process is difficult.
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JOHN MCHUGH, SECRETARY OF THE ARMY: We don't know what we don't know, but we are working hard every day to find out everything that is possible as to the who, why and what behind the failures -- particularly in procurement and particularly in contract and contract management.
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HARRIS: I've got to tell you, when this story broke, I spoke to the sister of an Air Force master sergeant whose burial urn was placed in a grave that was already occupied.
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DOROTHY NOLTE, SISTER'S GRAVE MISHANDLED (via telephone): We had never been notified that this mishap had occurred. We were never given subsequent new grave site number identification information. Nobody consulted us for permission. And I do understand that the hierarchy there had stated that they had indeed done that, when, in fact, they had not.
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HARRIS: The military will have to answer for another outrage story happening right now. Some 1,800 veterans are being told they may have been -- may have been -- may have been exposed to HIV or hepatitis during a dental visit to a V.A. hospital, that happening in Missouri.
Our senior medical correspondent, Elizabeth Cohen, told us about the story last hour. She's back with more information, an update, and a new question to answer.
COHEN: Yes.
HARRIS: But, what do we know about what happened here?
COHEN: Well, what it seems happened is that these dental instruments were not supposed to be hand-washed and then put in the sterilizer. They were supposed to be put in some kind of a solution, not sort of hand-washed like -- like this.
HARRIS: Yes.
COHEN: And so -- because then you can take whatever might be dirty on your hands and put them on the utensils.
HARRIS: Yes.
COHEN: Now, the details are not in great abundance at this point. They have not come out with a graphic description of what happened. But from what best we can tell, that appears to be possibly the case here. But what's clear is that some protocol was not followed. And when you talk about dental instruments that go in your mouth, you would like protocol to be followed.
HARRIS: So wrong, absolutely wrong here to assume that the sterilizer takes care of everything.
COHEN: Correct.
HARRIS: Yes.
COHEN: You don't want it to be filthy dirty when it goes into the sterilizer. I'm not saying that's what happened.
HARRIS: Right.
COHEN: But there is a protocol that's supposed to happen beforehand. Now, we want to reinforce here, nobody may be sick at this point. Just because rules weren't followed doesn't mean anyone got infected. It just means it increased the risk that someone could get infected.
HARRIS: And we're even learning about this, because the government requires a kind of different reporting standard than what we see at other hospitals.
COHEN: Right. This could be happening in private hospitals, and they don't have to put out a press release. They don't have to tell anyone, really.
HARRIS: OK.
COHEN: So -- I mean, the CDC estimates that 99,000 people die each year from infections they get in the hospital. They didn't come in with them. They got the infection in the hospital and came out in a body bag.
HARRIS: All right.
COHEN: So, you know, it behooves you to think about this, even if you're not a veteran.
HARRIS: Make us an empowered patient, that's one of the things you do for us.
COHEN: That's what I try to do here.
HARRIS: So you get the note, you get the letter -- what do you do now?
COHEN: Well, you know, even if it you don't get the note or the letter, you need to -- you don't want to become one of those 99,000 people who die in the hospital from an infection.
HARRIS: Yes, good point.
COHEN: Now, some of this is beyond your control. However, there are some things that you can do. And if you go to CNN.com/newsroom, we have lots of links to places.
But one of the things you want to do is that online, there are places you can check out your hospital. You can see ratings for infection control and for safety and for all of those things. And, you know, a lot of people tell me, it's time that we as patients start demanding that hospitals do a better job. Don't go to the hospital that has a bad rating.
HARRIS: Yes.
COHEN: Go to the hospital that has a good rating.
Another thing you could do -- and I know I have done this with loved ones in the hospital. Someone walks -- I can't tell you how many times I've seen doctors and nurses walk into a hospital room and touch the patient without washing their hands first.
HARRIS: Wow.
COHEN: It's happened to me, it's happened to people in my family, and you have to say -- you have to empower yourself to say, stop, you look like a very nice, clean person. But really, I'd appreciate it if you would wash your hands.
HARRIS: And if you're a little timid in this area, this is a woman who can help you here, get your confidence up. You got a whole "Empowered Patient" segment on CNN.com.
COHEN: That's right, CNN.com/EmpoweredPatient, and that's what I'm here for --
HARRIS: Yes.
COHEN: -- is to teach people how to be empowered patients, because the medical system is not going to take care of you 100 percent. You have got to step forward.
HARRIS: Well, reach out to this woman. She will teach you how to fight the fight.
Elizabeth, good to see you. Appreciate it. Thank you.
An outlet for expressing anger at BP goes away, at least temporarily. Josh Levs will explain what happened with the boycott on the BP Facebook page. That's coming up next right here on the CNN NEWSROOM.
(COMMERCIAL BREAK)
HARRIS: So, why don't we do this? Let's get an update on the Gulf oil disaster. The government's point man is stepping up to the microphones right now, Coast Guard Admiral Thad Allen.
ADM. THAD ALLEN, NATIONAL INCIDENT COMMANDER: The conditions on scene at the wellhead right now are winds between 17 and 22 knots. And we have a sea state of about seven feet. In the next 24 hours, we look for that to diminish slightly. The wind, 12 to 14 knots. And over the next 24, 36 hours, to have the wind drop -- the sea state drop to about six feet.
The major impact on the operations out there right now have to do with hooking up the third producing vessel, the Helix Producer, which was anticipated to have been done right about now, but has been delayed because, I believe, the hook up to the flexible hose has been prohibited by the sea state. But we are able to continue the production that's going on out there. And last night, over the 24- hour period that ended at midnight, we produced 25,000 barrels -- over 25,000 barrels, and we continue to produce the Discovery Enterprise and the Q4000 can produce at the sea state without a problem.
The Development Driller 3 is within 16 feet of the wellbore, continues to go down 200 or 300 feet at a time, continues to close the wellbore, put electrical sensing device down, check the magnetic field to find out how far they are away. They're in their third series of these ranging activities. They'll continue to do that over the next several weeks as they get to the optimum point where they can turn and actually intercept the wellhead.
We are on -- we are ready to connect the Helix Producer to the vertical riser package that's been out there as soon as we get the sea state to do that. It's going have to drop to about three to five feet.
At the end of that flexible hose that comes off the vertical riser, there is a flange, a big circle with holes in it we put bolts through, and there are 24 bolts that have to put through and bolted to the other connecter to do that. If you can imagine doing that between a very large vessel moving at sea, it's dangerous to do it in anything other than calm conditions. So, we're waiting to do that going forward.
I would like to make a couple comments about the Jones Act. There have been a lot of questions about that. We, at no time in the course of this response, have been inhibited by anything having to do with what we call Jones Act or Jones Act waivers.
All the vessels that are operating outside three miles do not require Jones Act waiver. And we've been able to use foreign flag vessels out there as we have needed. There have been consideration given to Jones Act --
HARRIS: OK. Here's what we will do -- we will continue to listen to the briefing and if we hear some real news here, we will turn it around for you.
Putting a positive spin on the disaster in the Gulf, BP has dispatched its own reporters to the region. They're telling the story from the company's perspective -- details now from CNN's Randi Kaye.
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RANDI KAYE, CNN CORRESPONDENT (voice-over): As the managing editor of the "Lafourche Gazette" newspaper in Larose, Louisiana, Vicki Chaisson knows a thing or two about journalism. So when a BP employee showed up unannounced to interview here on May 21st in her office, she realized, right away, she says, he had an agenda.
VICKI CHAISSON, MANAGING EDITOR, LAFOURCHE GAZETTE: I think what he did was try to come in here and get something positive.
KAYE (on camera): What kinds of questions did he ask you?
CHAISSON: What he wanted to know was: how people's reaction was to BP. In other words, I got the impression he wanted to know if everybody thought BP was the bad guy.
KAYE (voice-over): Her answer at the time was that people were looking for someone to blame, and BP was it, hardly a blistering critique. Days later, her interview was posted here on BP's Web site, among their blogs from the Gulf in the BP newsletter.
(on camera): It turns out, BP has dispatched two employees to the Gulf who call themselves, according to their blogs, "BP reporters." But their reporting looks nothing like our reporting or the rest of the media's reporting. It's far more positive.
(voice-over): Check out this blog by BP reporter, Tom Seslar, the same guy who interviewed Vicki Chaisson. Here, he interviewed a family in the seafood business who says, quote, "There is no reason to hate BP," and, "The oil spill was an accident." This, from folks in the seafood business, which has been destroyed by the BP spill.
HOWARD KURTZ, HOST, CNN'S "RELIABLE SOURCES": There isn't one person in America who is going to be fooled by this propaganda campaign. The reporting has been so positive that you would think that they were on BP's payroll -- oh, that's right. They are on BP's payroll. Maybe that explains it.
KAYE: But wait, there's more. A blog from May 28th by another BP reporter about the clean-up efforts on the water, describes it as, quote, "A ballet at sea as mesmerizing as any performance in a concert hall, and worthy of an audience in its own right."
And with tourism in trouble, how's this? A May 24th blog, "Much of the region's other businesses, particularly the hotels, have been prospering, because so many people have come here from BP and other oil emergency response teams."
Wait. So BP is helping tourism?
CHAISSON: He's not over here to publish the negative stuff. He wants the positive stuff. And there's not a whole lot that's positive. If he would come in today and do interview, ooh, I don't know that he'd want to publish it.
KAYE: Keeping them honest, we asked BP about these so-called reporters. A spokesman told us, quote, "These articles are intended to provide our readers with coverage about our response efforts." BP says it's offering stories about the response, quote, "that are generally not covered by mainstream media, by major cable networks, or by CNN."
BP also says, quote, "Many of our employees are putting their hearts and souls into this response -- telling these stories is one way we are recognizing their efforts."
CHAISSON: You know, there's just been so much printed, and so much that's come to light since then, that no one is trusting whatever BP says at this point. No one is.
KAYE (on camera): Especially not Vicki Chaisson anymore, who 10 days after her interview with BP, wrote a negative editorial about the company. Comments like those, she believes, would have been edited out by the BP reporter who interviewed her.
Randi Kaye, CNN, New Orleans.
(END VIDEOTAPE)
HARRIS: OK. One of the biggest outlets of the country for people to express their anger and outrage at BP has disappeared. Well, it did, at least for a while.
Josh, what happened to the Boycott BP page on Facebook?
JOSH LEVS, CNN CORRESPONDENT: It was a big deal. We're getting all these messages in the NEWSROOM about it yesterday and you know throughout this whole crisis, one thing I have been following this is online P.R. battle, right? There is so much fury in this world and this country, a lot of people are turning to the web, this is, by far, one of the most popular places to express that outrage.
It is back up and running. This is the Boycott BP Facebook page. And I've been following the numbers today. They have picked up several thousand more fans today. They have 750,000 fans on this page right here.
But for a while yesterday, it disappeared. So we made some calls. We've looked into this here at CNN. Let me talk you through what we know about why this happened.
We have a statement from Facebook. What they say is that the page was "disabled by our automated systems," which means they're saying no one sat down and made a subjective determination that the page shouldn't be there anymore. There's something technical about the way the page was being used and they say just made that happen, and they say, "We determined the profile was removed in error and now has been restored." So, they say they then went and looked at it and say it should not have been removed and was put back up.
Now, some people say there's not a clear enough explanation about what actually happened. Here's a statement from someone with Public Citizen, a group that's really been tackling BP throughout this crisis, Greg Beck, an attorney there, who said, "I don't think it's much of an explanation at all."
Now, a lot of people are probably wondering whether BP itself had anything to do with it. So, BP has this statement right here saying, "We had absolutely nothing to do with this." That's a spokesman there, Robert Wine.
So, in the end, what is it exactly that happened that caused this page to disappear for a while? We don't know. And I asked the folks at BP a couple of times this morning -- rather -- at Facebook this morning and they're saying they can't detail the way the systems work, because they don't want spammers out there to get inside information about the way Facebook works. Maybe it's a coincidence, but Facebook did put something up today about a process that they have that watches out for spam. And it just happened to be published today on the official blog.
And they say, "Our spam prevention systems are not perfect. We're always working to improve them by actively monitoring appeals and learning from the rare cases in which we make mistakes."
That could have been in the pipeline already. In the end, Facebook not coming forward, giving the exact reason, Tony, why it was pulled down. But I'll tell you, during the time this page disappeared yesterday, I was getting so many messages from people really furious about this.
HARRIS: Yes.
LEVS: And that conversation is continuing today. Let's show everyone where you can weigh in on my page. It's Facebook.com/JoshLevsCNN. I posted a story about it this morning and within minutes, we had like 50, 60 comments in just one section of Facebook.
HARRIS: Very good.
LEVS: People really concerned about this, Tony, and they're still weighing in.
HARRIS: OK. Josh, appreciate it. Thank you, sir.
LEVS: Thanks.
HARRIS: We are watching the third day of confirmation hearings for Supreme Court nominee Elena Kagan. Some of the questions she is facing include questions on abortion and gays in the military. We have got a live report, coming your way.
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HARRIS: You know, we told you just a moment ago that there are few certainties in life, but we felt really good about putting in the certainty column the David Petraeus -- General Petraeus would be confirmed to be the new top commander of U.S. forces in Afghanistan. Yes, with certainty, 99 to zero. The general has been confirmed. So, about what we all expected after yesterday's hearing, the votes in, 99 to zero, confirming General David Petraeus to be the top U.S. commander in Afghanistan.
Supreme Court nominee Elena Kagan facing another round of questioning before the Senate Judiciary Committee right now. Yesterday, she was in the hot seat from 9:00 a.m. until 7:00 p.m., throw in a break there for lunch. She is about three-and-a-half hours into today's session. Senior Congressional Correspondent Dana Bash is on Capitol Hill for us.
And, Dana, if you would, maybe you could bring us up to speed on what the senators are focusing on today.
DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Well, I just want to tell you what just happened a moment ago, which is kind of interesting. HARRIS: Oh, sure. Sure.
BASH: And that is I believe Senator Feinstein might still be asking questions or perhaps it's moved on to -- oh, Senator Grassley on the Republican side.
But just moments ago, Dianne Feinstein was talking about the fact that she thinks it's such a good thing, from her perspective, that Elena Kagan would be -- would make it that there were three females sitting on the Supreme Court at the same time. It's interesting, they went through the 10 hours yesterday and not one person brought up her gender, which is something that was a big issue for President Obama when he nominated her. But she made the point that it is important, from her perspective, for women to keep making strides, to break the glass ceiling, from her perspective.
She also mentioned something that everybody in the room knows, and you get that sense big-time, that Elena Kagan, probably at this point, almost definitely will be confirmed. And that definitely is the tone and tenor of these questions, even from the Republican side. And there was an interesting moment right when this hearing started, though, that Republicans still insist that they don't know enough about Kagan's judicial philosophy. And Jeff Sessions, the ranking Republican on this committee, said this to make that point.
(BEGIN VIDEO CLIP)
SEN. JEFF SESSIONS (R), ALABAMA: We see our gifts and graces in many different ways. Those are revealed in our human and our knowledge. But I think we -- some of the critics who are saying, who is this nominee, exactly what do you believe, might find it from the -- from the testimony difficult to know if -- if Miss Kagan, whether you'd be more like Don Roberts or more like Ruth Bader Ginsburg.
(END VIDEO CLIP)
BASH: Now, he was trying to make the point that, we don't know where you are. But I've got to tell you, Tony, the minute that he said that, we got e-mails from the Democratic National Committee and others saying, ah-ha, we told you, she's a mainstream candidate. She is a mainstream nominee. In fact, what the DNC said is that it's a ringing endorsement from the top Republican on this committee of her mainstream qualifications and a vote of confidence in her nomination.
Now, I wouldn't go far enough to say that Jeff Sessions or perhaps any but maybe one of these Republicans will end up voting for her, but that just kind of gives you a sense of how things are going.
HARRIS: Yes.
BASH: Now one Republican did really hit her on a hot button issue like abortion. But, for the most part, it's been kind of in dense legal terrain this morning.
HARRIS: Well, can we, for a moment, Dana, talk about this hearing in terms that we're familiar with? Has anyone, to this point, laid a glove on her?
BASH: Not really. I think it's fair to say not really. And an interesting point. I've been kind of e-mailing back and forth with some conservative activists who, again, like everybody else, they're living on planet earth politically and they realize that Democrats have 58 votes in the Senate, and barring something extraordinary, she is going to get through.
But the politics of this are interesting. There is a lot of pressure on these Republicans to try to lay a glove on her and to try to lift back the veil from their perspective. And some conservative activists I'm talking to, they're unhappy with the performance of some of these Republican senators. They think that they're too long winded, too technical, too dense and not really pressing her on some of the issues that they care about. Maybe we'll hear it this afternoon, like how she will deal with the president's policy issues that will come before the court, no question, like health care.
HARRIS: Yes. All right, our senior congressional correspondent Dana Bash for us in Washington.
Good to see you, Dana. Thank you.
The deadline closes today on the home buyer tax credit, but 200,000 people could - could get shut out.
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HARRIS: Come this way. Come this way. Come this way. Come this way. Cnnmoney.com. You don't need to run. It's OK. To cnnmoney.com. The best financial website on the web. Here's the lead story, "credit card traps here to stay." And that's all about the fees. You know we'd like to think that the reform took care of those fees, but no, no, no, no, no. OK, cnnmoney.com.
We are three hours into the trading now. Just past three hours into the trading day. As you can see, we're having a much better day than yesterday. The Dow was down 268 points yesterday. All kinds of fears. Consumer confidence plunging. A better day. A bit of a rebound. We're in positive territory, up 21 points. The Nasdaq up 15 as well.
So the government has been handing out, as you know, free money for the past year-and-a-half, $8,000 to be exact, to every first time home buyer. But that tax credit actually expires today. Alison Kosik is at the New York Stock Exchange for us.
And, Alison, if you would, I know there's been some talk of a possible extension. Is Congress going to get to work on that something before the July 4th recess, maybe before the longer August recess? I'll shut up and let you have a word in.
ALISON KOSIK, CNN CORRESPONDENT: You know that's a really good question. When we talk about politicians, we always wonder, when is this going to get finished? Well, I'll tell you what, the House has already dipped its toe in the water, passing an extension with the deadline ending on September 30th. This happened yesterday. It actually passed with an overwhelmingly yea vote.
And now it's in the Senate's corner (ph). It's up to the Senate to pass it. But if the Senate does not pass it, first time home buyers are going to have to close today by the end of business to get the credit.
Now the extension won't help anyone who's shopping now. This is for people who've already signed a purchase contract by April 30th. According to the National Association of Realtors, though, almost 200,000 people, Tony, are going to miss out on it because they won't close in time.
HARRIS: Well, wait a minute. Why are so many people -- you just haven't closed, but all your paperwork is in. So why are so many people in danger of missing out on the credit?
KOSIK: Well, you touched on it. It's exactly because of that. You know, the tax credit has been hugely popular. Almost 4.5 million people have taken advantage of this tax credit. It includes first time home buyers, and also those repeat buyers. But it's creating this huge backlog of work for lawyers and lenders and realtors. So there's all this paperwork that has to go through.
Also, many people are trying to buy foreclosures and short sales. That's where the seller who owes more on the home than what it's worth. And then there are the appraisal issues that are at play here.
HARRIS: Yes. Yes.
KOSIK: You know, home prices are shaky and lenders are cracking down on appraisers. And that combination is slowing things down. So you've got all this paperwork to go through. We'll see, Tony, if Congress comes through and passes this extension. The deadline will wind up being September 30th.
Tony.
HARRIS: Talk about a program that's hugely popular.
KOSIK: Oh, yes.
HARRIS: All right, Alison, appreciate it. Thank you.
KOSIK: You got it.
HARRIS: Still to come in the NEWSROOM, the Taliban launch a brazen daylight attack in the Afghan city of Jalalabad. The target, an airfield used by international forces. A live report when we come back.
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HARRIS: All right, let's do this. Let's get you caught up on top stories right now.
A nervous wait along the Texas coast. Just hours from now, Hurricane Alex is expected to make landfall south of Brownsville and the Texas/Mexican border. The storm's main threat, flooding rains. Thousands of people have moved north. South Padre Island among the popular tourist spots now evacuated.
Alex has also impacted oil clean-up efforts in the Gulf from Louisiana to Florida. Skimming boats are back in port because the waves stirred up in the hurricane - well, they're just too rough. Some of those waves are 12 feet high.
And in Washington, the Senate approves President Obama's choice to lead the U.S. war effort in Afghanistan. The vote to confirm General Stanley - I'm sorry, David Petraeus as commander of Afghan war efforts came just minutes ago. He replaces General Stanley McChrystal, who stepped down after a magazine interview critical of the Obama administration.
Taliban militants, today, launched a daylight attack on an airfield used by Afghan international forces. It happened in the eastern city of Jalalabad, near the border with Pakistan. Our Atia Abawi is in the capital of Kabul.
Atia, great to see you.
Maybe you can tell us about this aspect of the story, the Taliban texting about the attack?
ATIA ABAWI, CNN CORRESPONDENT: Absolutely. Tony, it goes to show you that the Taliban know what they're doing. They know media relations. They have had this propaganda campaign going on for a while.
I get daily texts from the Taliban spokesperson, Zebula Majahead (ph), several times a day, for that matter. And when there are big attacks, he usually calls me. And, actually, he's very polite. I have to say that, Tony. He wakes me up in the morning and he'll tell me about a major attack.
In fact, he only does that for big attacks like we saw last month at the Bagram Air Base, which was, coincidentally, just like the attack that we saw today in Jalalabad. But this time, apparently, this attack to him not being a big deal because he decided just to text and not to call. So that's what's the most frightening right now, that the Taliban are feeling very, very confident. They feel that their attacks will continue this way and actually get stronger as the months go by.
Tony.
HARRIS: Atia, forgive me here, but can we track those text messages? I'm sure the U.S. military would like to have a conversation with this person who is texting you about attacks.
ABAWI: You know, that's the big question. It's a question that I've been asking for several years now, because I've been talking to this spokesperson, Zebula Majahead, for a couple of years now trying to confirm news from the Taliban for CNN. But what I've learned when I came to Afghanistan almost two years ago was is that Zebula Majahead is not one person. That the Taliban are playing a smart game.
When he is, is a sim card. Zebula Majahead changes. Could it be every several months, every couple of years, we don't know. They're playing the game correctly. They're changing the sim cards, they're changing the person and they know which media to go to. They know how to get their message out.
HARRIS: Yes.
ABAWI: And, in fact, just in December, coming out with a documentary, a 37-minute documentary in English, on how they can defeat the NATO forces. It's actually -- it's pretty frightening.
Tony.
HARRIS: Yes. Let's get back to this attack on the air field here. What can you tell us about the air field and the area around it?
ABAWI: Well, Jalalabad is based - it's in eastern Afghanistan. The Jalalabad airfield is a fairly large base, although it's a NATO base that primarily has U.S. forces in the vicinity, supplying and resupplying the smaller bases around it.
And the attack that we saw today was a vehicle-borne IED -- that's a car bomb -- on the perimeter of the base, making way for the insurgents to flow in and try to fight the NATO forces. NATO officials here say that they were actually able to kill the insurgents. In the end, two of their own forces, NATO forces, were actually injured in this altercation.
But we should also note, we've seen this again. Like I said just a couple minutes ago, that this happened in Bagram last month. This is a tactic that the Taliban feels works for them. So it's obvious that they're going to continue to try it. And from what we hear is that come July, come August, they want to have multiple attacks, which way they want to, because they want to scare off the NATO forces, the NATO countries, to push them out of Afghanistan.
HARRIS: But the other truth here is, if the enemy comes to your base, you should win that fight every time.
Atia Abawi for us.
Atia, good to see you, as always. Thank you.
Louisiana opens two areas to harvest oysters, but will they be safe to eat?
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HARRIS: Got to tell you, Louisiana has reopened two oyster harvesting areas. They're in Plaquemines Parish and they've been off limits to oystermen since May 23rd. Anderson Cooper visited with a couple of men who are concerned about what's in the water and what it could mean for their livelihood.
(BEGIN VIDEOTAPE)
ANDERSON COOPER, CNN CORRESPONDENT (voice-over): In Empire, Louisiana, the oyster boats are idle. Mitch Jurisich last went out to farm oysters more than three weeks ago.
COOPER (on camera): How many oysters would you bring in on a normal day?
MITCH JURISICH, OYSTER FARMER: A normal day, prior to the shutdown, I was averaging 150 sacks.
COOPER (voice-over): Though the state of Louisiana today reopened the waters here to shrimpers and oystermen, Mitch isn't going to farm oysters just yet. He's not convinced the oil isn't still here. And besides, he doesn't have a crew anymore. They have all taken jobs with BP. Every day he still goes out on the water.
JURISICH: And this is the first area where I spotted, you know, heavy oil.
COOPER: The heavy oil is gone for now, but he thinks there may still be oil and dispersants under the water. He uses long tongs to scrape a few oysters from their beds.
COOPER (on camera): How do you tell if it's healthy oysters?
JURISICH: Market size? Well, the color of it. You know, the brown-looking color. You know, everything looks good. But what lies inside, we don't know. There's no way to --
COOPER: That's the concern, what's inside?
JURISICH: That's the concern, what's inside. An oyster can ingest oil and still survive. You know, and the dispersants and all, we don't know anything about how they can survive dispersants or anything associated with that.
COOPER (voice-over): It takes three years for an oyster to mature to the correct size.
COOPER (on camera): And this is about a year old?
JURISICH: About a year old. These are about three years old, when you see them get to be the three to four inch size.
COOPER (voice-over): May and September are the spawning months for oysters. Mitch worries this disaster could not only wipe out the current crop of oysters, but the next generation as well.
JURISICH: We know oil will impact oysters if it gets on the oysters. But most of the time, oil will be on top of the water. And if it doesn't come in direct contact with the oysters, the oysters stand a good chance of survival. But when it's disbursed, in the way it's being disbursed, and it winds up throughout the water column when the oysters can ingest it and that's the big question mark, will it have an impact? Yes. To what extent? We don't know. COOPER: In shallower water, Mitch has begun to find dead oysters.
JURISICH: This oyster's recent dead.
COOPER: An unusual sign he believes has something to do with the oil or the dispersants being used to combat it.
COOPER (on camera): Now, is that normal?
JURISICH: No, not for this time of year. No, this is not normal. You know, we have certain -- some mortalities that are normal. We're finding more and more of this. Something's not right.
COOPER (voice-over): Back on shore, Mitch opens up some of the oysters he's harvested today. They're plump and fresh and there's no sign of oil. They taste terrific. If the storm passes and no new oil appears, he thinks he may start farming next week. But he is not overly optimistic. After farming these waters all his life, he's sure more oil is coming, and he's sure time is running out.
Anderson Cooper, CNN, Empire, Louisiana.
(END VIDEOTAPE)
HARRIS: The great one. A talk show legend hanging up his suspenders and unplugging his microphone. Ines Ferre tells us about Larry King's big announcement in today's edition of "What's Hot."
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HARRIS: So, here's the deal. We know a lot of you are online right now. Apparently this is like the - the hot time of the day for folks to get online. All right, I get it on the East Coast. Everybody sort of checking the news, e-mails and everything else and everyone on the West Coast getting their fix, an early start to the day. Perfect. Perfect.
Oh, I'm sorry, Ines Ferre is here. We were having a conversation. Let's bring you into the conversation with what's hot right now online and the man.
FERRE: Yes. And Larry King -
HARRIS: The great one.
FERRE: He's been trending on Google, and his blog on CNN. You can see so many people leaving comments. Sorry to see you go, Larry. Thanks for the years of great work. And you can also check out - actually they've got this great site on CNN, Larry King's Top 25 Moments, where viewers even voted on the top five moments of Larry King. And one of them is his interview with Marlon Brando, 1990.
HARRIS: Oh, yes, yes. Oh, yes.
FERRE: We want to play you a little clip of that.
HARRIS: We got a clip?
FERRE: A little clip of the interview.
HARRIS: Let's do it.
(BEGIN VIDEO CLIP)
LARRY KING, "LARRY KING LIVE" HOST: We've got a full hour to go. This is "Larry King Live." Don't go away.
All right, let me get a break. We'll come back with Marlon Brando. There's lots of other things to talk about.
MARLON BRANDO: No, I'm leaving now. It doesn't matter what he says.
KING: No, and we'll -- we're going to take phone calls.
BRANDO: Just leave it there and it will (INAUDIBLE).
KING: But how does this look?
BRANDO: What? It looks like that.
(END VIDEO CLIP)
FERRE: That's just a really funny interview.
HARRIS: That's good. That's good, yes.
FERRE: And he's just -- and he interviewed so many people.
HARRIS: I love the Ahmadinejad interview. Just tell me, answer the question, did the Holocaust happen or not? And then he does his Ahmadinejad thing. Yes, so that's it, right?
FERRE: Yes, that's it.
HARRIS: Trending online, "Larry King Live," the great one. I'm young enough to remember his radio show on Mutual (ph). Wow.
All right, thank you, Ines.
And there is certainly a lot more Larry King to come between now and this fall. Tonight, for example, he talks with Elizabeth Edwards about her split from John Edwards. You can see the entire interview, "Larry King Live" tonight at 9:00 Eastern right here on CNN.
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HARRIS: It is go time. CNN NEWSROOM continues right now with the man, T.J. Homes, in for Ali Velshi.
T.J. HOLMES, CNN ANCHOR: And when you say go time, folks, he means it's time for him to go is what he means.
Thank you, Tony.
