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Hurricane Earl Swipes Outer North Carolina Banks; Unemployment Rate Higher in August; Hurricane Earl Kicks Up High Waves Along East Coast; Rural Alabama Schools Use Video Conferencing to Offer Classes; Fire Out on Gulf Oil Platform; Discovery Channel Building Reopened After Hostage Crisis; Miami Airport Reopened After Bomb Scare Forces Closure; Jobless Report Better Than Forecast
Aired September 03, 2010 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
T.J. HOLMES, CNN ANCHOR: Hello to you all. I am the aforementioned T.J. Holmes sitting in today for Kyra Phillips. We are talking about Earl.
This thing is still a massive storm. Not as massive as it was yesterday when I was talking to you around this time. But it has smacked now the outer banks of North Carolina now. Cape Cod could now be the next target.
We have team coverage for you right here. Let you know what this storm could possibly do to your holiday weekend as well.
Also, a scary moment in Miami. The airport had to be shut down for a bit. Parts of it at least because of a pipe bomb scare. Pretty much shut the airport down. We'll tell you what happened there.
Also, we just got the new numbers. The jobless rate went up on the month of August. But there's still more to dissect in these new jobs numbers and will certainly do that for you right here.
But let's start with Earl. It is east-northeast of North Carolina's outer banks right now. And it's now a category 2 storm. It was a category 4 when we were talking to you around this time yesterday.
We do have team coverage of this storm. And we need it because there's so much to talk about in the entire East Coast being affected by this.
Our Rob Marciano. He's in Kill Devil Hills for us in North Carolina. Brianna Keilar, she's in Ocean City, Maryland. Our Allan Chernoff is on the east end of Long Island, New York, for thus morning. As well as Susan Candiotti who's farther up at Cape Cod.
Reynolds Wolf is here with me in Atlanta. He is keeping an eye on the track of that storm.
Let's start with Rob.
Rob, I saw you a little earlier, just couple of hours ago. You would describe it as getting hit in the face with needles. That wind was really blowing that rain into your face. Well, how is the weather now? It seems like it's maybe a little different now.
ROB MARCIANO, AMS METEOROLOGIST: It has improved. But we're -- we're at the stage of the game, T.J., now where we'll get squally weather, meaning it will be calm one minute and then we'll get up the back half of the rain band. And that will bring down not only rain but some of the higher wind gusts from the higher levels of the storm.
So that's where we are now. But behind me we certainly have some wave action that has been quite consistent throughout the day today. And throughout the night last night. And this will continue to pound the coastline here.
Reports of the Highway 12 south of here being over-washed and cut off. So Hatteras and the other areas down south of here are pretty much cut off from the civilization until these waters recede which probably won't be until later on today.
It was a long night last night, I'll tell you that. Around 10:00, 11:00 is when things really started to ramp up. And at one point, 2:00, 3:00 in the morning, this hotel was really moving side to side.
When we did that report this morning at 6:00 a.m., the rain was blowing sideways and knocked out our cameras. So we're with a backup camera here with a higher vantage point here on the balcony.
But I think that, T.J., we're going to start to see things improve. Remarkably, there's just spotty power outages. At least here in Gary County. Down to the south, there's a little bit more in the way of power outages.
No reports of significant damage. Some roof shingles and tiles and that kind of thing off some weaker structures. But all in all, this could certainly have been a lot worse. I would describe it as Earl, the western side of it, raking or scraping the coastline. Sideswiping it. So not quite missing us like we hoped but certainly a lot better than it could be.
HOLMES: All right.
MARCIANO: T.J.?
HOLMES: Like you always say, Rob, they always prepare for the worst, hope for the best, and maybe dodge a bit of a bullet here.
Rob, we appreciate you.
Head over to Reynolds Wolf now to tell us exactly where this storm is headed.
And Reynolds, I loved the analogy you used with me earlier about this storm. You said it's kind of like an old man right now.
REYNOLDS WOLF, AMS METEOROLOGIST: Yes. It's kind of like in its life cycle. HOLMES: Yes.
WOLF: What we're talking about. It's already past its prime, now it's beginning to weaken considerably.
And you can see it plain as day on enhanced satellite imagery. Let's enlarge this for a second. It's still strong. It's still a category 2 storm. We've got winds sustained of 105 miles per hour. Gusts have been even stronger up to 125.
You see the latitude and longitude. You've got Cape Hatteras here just to give your bearings. The center of circulation is right about there. But in terms of an eye, the eye no longer exists. It has just fallen apart.
Dry air is intruding the western half of the storm. It's beginning to come in. It's starting to lose some of its structure. Although I have to tell you, though, just looking at it from not an enhanced satellite, but just regular satellite, still looks pretty good for the time being.
What we can't anticipate, though, is although still the heaviest precipitation is still in the northern half of the storm, out to sea. We're still going to see some very large waves in many spots especially along parts of the Maryland coastline, back into the Jersey shore, same thing.
And as the storm goes farther to the north, although it is forecast to continue its deterioration and continue to weaken, it'll still bring rough surf conditions to parts of the Jersey shore, as I mentioned. Eventually pass parts of Massachusetts.
One thing very quickly that I want to mention. Just over the next 15 seconds or so, I want you to look at that cone of uncertainty. You see it shaded there. On both sides.
They call it the cone of uncertainty because there's a chance the storm can move a little bit more to the east or perhaps the west. If it goes more to the west it could go right to Cape Cod. And because of that, it's currently why they have warnings that are in effect in the Cape Cod area.
One thing last -- as we wrap things up, here you go for your wind gusts, some of them in excess of 70 miles an hour in North Carolina. All along the coast, Pamlico Sound, no surprise, 73 miles per hour wind gusts. More of than can be expected as the storm marches northward.
That is the latest. We've got so much to share with you with this storm. Again, it is a dying storm but still it's a force to be reckon with -- T.J.
HOLMES: And, Reynolds, one quick thing that you -- you talked about, winds could possibly cause a problem with travel. A lot of people trying to get around this weekend. WOLF: Absolutely. I mean you're going to see backups. Again, when you have really windy conditions at your airports, especially in place -- like all your major airports in the northeast including up in Jersey and Newark.
All your airports in New York, up in -- at Logan and Boston, you could see a lot of backups. And of course backups there spilling over into -- backups, say, in D.C. Perhaps in Atlanta. So it could be a very frustrating day for travelers, no question.
HOLMES: All right, Reynolds, appreciate that. He's keeping a close eye.
Let's turn now to our Allan Chernoff who's at the eastern end of Long Island for us right now.
Allan, Reynolds was just talking about some of those waves coming in. And we saw some of your pictures earlier. Certainly seem to be the case where you are.
ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: T.J., your timing is perfect because it has just begun to rain. The rain started to come down. And have a look at what's happening out there.
The clouds have moved in. And I'll tell you, some of those waves very intense. They're break about 100 yards out. And some of these are well over eight feet high. You can probably see the mist coming off of those waves. Very powerful right now.
People here had been preparing but not everybody has been preparing. I mean we've got some homes, some hotels that have boarded up, some windows. Other people have told me I'm not doing a thing. I don't really worry about this at all.
Folks have brought in their outdoor furniture, the garden furniture. Wrapped it up. The surfers, well, they have been out enjoying it. I don't know if this is really the weather that they want to be out in right now.
We spoke to somebody late yesterday. She was having a ball but well aware things could get dangerous.
(BEGIN VIDEO CLIP)
KATE SINDING, SURFER: There are definitely dangers involved. This is the fun part. The sort of the pre-hurricane swell that comes in and everybody rushes out. And it's a great time. But obviously we're all aware that we've got to be careful. And tomorrow is going to be a different story out there.
(END OF VIDEO CLIP)
CHERNOFF: And T.J., during that sound bite the rain has just started to come down seriously. The sky opening up. A few hours ago we had fishermen out here. They were catching some striped bass. But right now the beach is pretty much empty. Back to you.
HOLMES: Yes, empty except for you, it appears, Allan. And we certainly do hear that rain kicking up. Allan Chernoff there for us. We'll continue to check in with you.
Going to check in with him and the rest of our team, continuing with our team coverage of this storm as it makes its way north right up the coast. Stay here with us for that.
Want to turn to the economy. Now. We just saw some new unemployment numbers that just came out minutes ago. New jobless numbers and it does appear that that all-important unemployment rate has ticked up, gone up to 9.6 percent.
Economists see that as further evidence that this recovery is weak. There is some good news, though. Employers cut fewer jobs than expected. Cut 54,000 jobs in August. That's the same pretty much as the month before.
But the good news here is that of that 54,000 lost in July still less than half of what was originally estimated. So that is some good news.
Let me bring in our Ali Velshi who is helping us get inside these numbers a little bit.
ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Yes.
HOLMES: Ali, hello to you once again. People always see that unemployment number. And, you know, it's horrible any time it ticks up. But you got to look a little deeper to see --
VELSHI: Absolutely.
HOLMES: -- maybe some positive news within it.
VELSHI: In fact, for today, ignore it. I've been saying for 2 1/2, 3 years, you know, we get so caught up on that number and it's easy to understand but forget it. That's not the important number. The important number is the 54,000 jobs.
Now why are we a little bit elated about a loss of 54,000 jobs? I'll tell you why. Number one, that total number of jobs lost in August is substantially less than what was predicted. So that's good news. Which means over the last three months the number of jobs we have lost has been a little less each month. We are going in the right direction again.
That is fantastic news. Talk about dodging a bullet. You've been talking about the hurricane. This is dodging a bullet here.
Here's the more important thing. Fifty-four thousand jobs were lost in August, 121,000 jobs in the government sector were lost. Those Census jobs that ended. So we actually lost a lot of government jobs but there were actually 67,000 new jobs created in the private sector. And that is where this economic recovery has got to come from. So the bottom line is where we need jobs to be built in the private sector, we got them. Where we don't need jobs to be built or where we don't want them for the long term, in the government sector, we lost them.
So 54,000 down. But in the private sector, 67,000 up. And trend is in the right direction. Again, for today, ignore that 9.6 percent unemployment. The important number was jobs lost and jobs created. There is a lot of good news in this report -- T.J.
HOLMES: No -- Ali, I absolutely get what you're saying about ignoring that number. But it's hard. It's so hard with the American people. You hear that the unemployment rated goes up and that just sounds terrible.
VELSHI: Yes.
HOLMES: Just psychologically, that's difficult for some people to see it.
VELSHI: Right.
HOLMES: Because they're not going the hear this breakdown in a lot of --
VELSHI: Right.
HOLMES: -- in a lot of places like you just broke it down.
VELSHI: OK. Let me tell -- I agree with you and I wish they did. What I'm telling you about the 67,000 up, the 121,000 government jobs down, the net number of 54,000 jobs, that is absolutely real. That is information you can take to the bank.
You can't take the unemployment number to the bank. Why? Because it is a percentage of a total that is always shifting. It's the total number of people who are in the work force actively looking for work. Sometimes people drop out of that, sometimes they're moving.
It's shifting sense. That number of jobs lost and jobs created, and what you can do -- it's very easy to research this, we'll have it on Money.com -- you actually see what industries were growing. That tells you stuff.
Health care continues to grow. Education continues to grow. Retail sales reflects. So if you're looking for a job, at least you see where the trend lies.
HOLMES: All right. Important to make that distinction but, again, you always got to get inside those numbers.
VELSHI: Yes.
HOLMES: And we always appreciate having you to get inside those numbers. Ali, we appreciate you, as always, buddy.
VELSHI: I miss seeing you in person but I'll be back soon.
HOLMES: We miss you here as well, Ali. I wish we could hug it out now but I'm going to go.
We're going to hearing from the president --
(LAUGHTER)
HOLMES: -- here in just a bit. Going to be talking about these jobless numbers as well. He's going to be talking about it at the top of the hour. We will bring you his remarks live.
Again the president talking about these numbers coming your way at the top of the hour.
Also, we've been talking a lot about education this week here at CNN. I want to tell you about a Spanish class that is taking place in rural Alabama. The teacher of that class, however, is nowhere near rural Alabama. About 60 miles away from the students.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: (SPEAKING IN FOREIGN LANGUAGE)
(END OF VIDEO CLIP)
HOLMES: States. Why they say that long-distance learning translates to big savings and higher graduation rates. Stay with us here. It's 12 minutes past the hour. We'll be right back.
(COMMERCIAL BREAK)
HOLMES: Live picture here, where we're keeping an eye on -- just behind me, keeping an eye on Earl. But you see one place, Manasquan, New Jersey behind me, where waves have been kicking up. People still out there enjoying some of those waves. But it is dangerous in many areas along the coast as waves are kicking up. Earl is on the way. We have our team coverage. We will keep a very close eye on the storm.
All week, CNN is confronting the national education crisis and focusing on how to Fix Our Schools. Today, the course catalog is growing for students in rural Alabama thanks to a video hookup and a long-distance learning program.
It started with a couple hundred students, but five years later, 32,000 kids are learning from a distance. Alabama credits the program with boosting its graduation rates, and school officials think other states can learn lessons from Alabama in the face of big, massive budget cuts. Our Mary Snow with this story.
(BEGIN VIDEOTAPE)
MARY SNOW, CNN CORRESPONDENT (voice-over): While most kids are told to power down in the classroom, these 11th graders at Real Town High School are encouraged to log on and tune in. DENE CARTER, HIGH SCHOOL TEACHER: Muy bien. Gracias.
UNIDENTIFIED STUDNETS: Muy bien. Gracias.
SNOW (voice-over): These students will likely never meet their teacher, Dene Carter, and only know her through a video monitor. She's teaching some 65 miles away from a different high school. But if they want to learn Spanish, this virtual classroom is the only option.
CARTER: Como te llama?
UNIDENTIFIED STUDENT: Me llamo Cheyenne.
SNOW (voice-over): Cheyenne and her classmates are taking part in Alabama's fix for schools located in rural areas where it's difficult to attract teachers, leaving high schools without some basic courses. To bridge the gap, the state started an experiment in 2005 with distance learning, linking classrooms online and with video conferencing. The program says Alabama's education superintendent, Joseph Morton, now stretches to al high schools.
JOSEPH MORTON, ALABAMA STATE SUPERINTENDENT OF EDUCATION: In five short years, it's become, what we think, an Alabama miracle. It's really leveled the playing field for so many students and so many families.
SNOW (voice-over): In the past, offering Spanish was a possibility. Now public high school students have the option of five languages that include Latin and Mandarin. Advanced placement classes were also added.
But it takes some getting used to. The bulk of the class is done online, with students sending homework to Dene Carter through audio clip. And most communication is done through e-mail.
SNOW (on camera): What's it like so far?
UNIDENTIFIED STUDENT: It's kind of challenging because I'm used to seeing my teacher right in front of me if I have a question. And I have to do it on the internet.
SNOW: There are critics outside these programs who say that face-to- face connection is crucial. What do you say to the skeptics?
CARTER: Face-to-face connection with students is very crucial to learning. But at the same time, we are moving into an era where these kids may be going to jobs and they are -- they work out of their homes. And they have a boss that they never see.
SNOW: And some students say it's helping them get ready for college. The state education's boss says the proof is the in the numbers, with the graduation rates rising.
MORTON: What a change that makes for the future of this state. We graduate about 42,000 kids a year. And if we can increase that to where we can graduate 48,000 or 50,000 a year, like we should be, that's eight thousand live a year we've changed.
SNOW: And the challenge now, he says, is keeping up with demand. Mary Snow, CNN, Real Town, Alabama.
(END VIDEOTAPE)
HOLMES: Coming up next hour, "House Call" with principal Steve Perry. He's checking in with a family that worries it's too late to break some bad study habits.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE SPEAKER: Is it too late? They're already in middle school. Have we already missed the ball?
STEVE PERRY, CNN EDUCATION CONTRIBUTOR: That's a great question. Is it too late? No.
UNIDENTIFIED FEMALE SPEAKER: We've established some very --
PERRY: No, no, no.
UNIDENTIFIED FEMALE SPEAKER: Weak skills here.
PERRY: It's a great question. Is it too late because they're in middle school? The answer is, absolutely not. In fact, it's at this time and in high school when it's most important for parents to engage their children. It's at the the time they seem to want it the least, that they need it the most.
So, the first -- Mom, took a deep breath.
UNIDENTIFIED FEMALE SPEAKER: Yes.
PERRY: Why did mom take a deep breath?
UNIDENTIFIED FEMALE SPEAKER: I'm just --
PERRY: This thing makes you scared? It makes me scared, too.
UNIDENTIFIED FEMALE SPEAKER: That's OK.
PERRY: It's a big marker.
(END VIDEO CLIP)
HOLMES: What in the world is Steve up to? Our principal is spelling out the problems, he's detailing strategies to fix them. He is going to be talking to us, joining me live, always interesting to talk to him. He's oming up your way in the next hour.
Also, you guys have been sending us a lot of ideas about how to fix the schools. You've been doing this all week long. Keep those suggestions coming, because our digital producer, Derek Dodge, is not busy enough. Look at him. He looks bored. Send him some more stuff to do over there. He's going through all of your comments. Coming up next hour, we're going to read some of your ideas right here on the air.
Also, how does the main man who's leading our education system feel about fixing schools? We're going to hear from him in just a couple of hours. He is going to be talking to our Tony Harris. Talking to the Education Secretary, Arne Duncan. That's coming up. Coming your way at noon.
(COMMERCIAL BREAK)
HOLMES: We are keeping an eye on this storm. A storm that's now a Category 2 hurricane. On the left there, you're seeing the waves pick up in New Jersey. On the right, that's Kill Devil Hills in North Carolina, that got sideswiped. Went through kind of a rough night, waves still kicking up, but no one has gotten a direct hit as of yet.
But still causing all kinds of problems with this storm. Wind gusts are going up to 70 miles per hour in some areas. Few power outages reported as well. But still, a lot of people on the lookout for this storm, going to cause problems up and down the East Coast for the rest of the day, maybe the next couple of days, actually. We are keeping a close eye here at your hurricane headquarters.
Also want to take a look now at some of the stories that are making headlines. The fire is now out. That was a Gulf oil platform. Look at this dramatic picture, though. These are the 13 crew members that had to be rescued. They got into the water okay. But there was a fire on their oil platform they were working on. Also, importantly, to note here, which a lot of people were concerned about when they first heard about the story, there is no sign of any oil sheen or any type of leaks associated with this just yet. That is good news. This is still under investigation.
Also, the Discovery Channel hostage-taker, turns out he was once convicted of immigrant smuggling. We're starting to learn more and more about this man. James Lee is his name. He was sentenced at one point to 18 months in prison on the charge of immigrant smuggling. He blasted immigrants in his manifesto that he left behind. Of course, he took hostages at the Discovery Channel headquarters up in Silver Spring, Maryland, because he was upset with some of their programming.
The picture you are seeing here, this is out of Miami, the airport there has reopened. It was closed a short time, several hours, actually, because a bomb squad needed to check out what was a suspicious item. That use turned out to be a metal canister that looked kind of like a pipe bomb. They checked it out. All clear. Everything is open once again.
Again, just a short time ago, we saw the monthly jobless numbers. They are out. We'll see how the news is affecting Wall Street. The opening bell just about four minutes away. Stay here.
(COMMERCIAL BREAK)
HOLMES: We want to head to Wall Street. Our Alison Kosik, we're going to go right to her. Bell is about to sound shortly. Everybody's wondering how we're going to take these new jobless numbers we got today. Some good news in there, some would say, Alison.
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Well, we are seeing a light at the end of the tunnel, at least for employment, T.J. Wall Street's been waiting all week for this report, the employment report. And it came in much better than forecast.
The economy, it still lost jobs. US employers cut 54,000 positions in August. But that is a far cry from the 120,000 that economists were expecting. And most of the job losses were because of further cuts in temporary Census Bureau positions.
Now, private employers, they added 67,000 jobs last month. That's really good news for the economy, because what it will wind up doing, it's putting cash in consumer's pockets, and then, they're likely to spend it. The jobless rate ticked up to 9.6 percent, but Wall Street is likely to just look past that.
I'll tell you what, though. The market has really been jittery leading up to the reading. Right now, we are seeing a pretty strong start. Dow right now is up about 45 points. The NASDAQ higher by 27. And the S&P 500 is also up a bit.
Now, we are watching one stock today, BP. The oil joint now says that it spent $8 billion so far in response to its oil spill in the Gulf of Mexico. We will also be keeping an eye on shares of Mariner Energy. Those tumbled yesterday after one of the company's oil rigs caught fire in the Gulf.
And coming up in about 30 minutes, a report measuring the health of the service sector in August. We will be keeping a close eye on that one because service positions now make up 80 percent of the jobs market. And you know we are watching the twists and turns in the job market. T.J.
HOLMES: Yes, that's one way to put it. Twisting and turning.
All right. Alison, we appreciate you, as always. We will be checking in with you here shortly. Thanks so much.
KOSIK: OK.
HOLMES: All right. Let's look at that picture now. Where is the picture? Kitty Hawk, North Carolina. This is where the Wright brothers got off the ground.
Well, not much getting of the ground right about now. Looking at that empty beach. Those waves kicking up -- can be beautiful but dangerous as well. We are keeping an eye on this storm, Earl. Yes, it is weakening but still causing all kinds of havoc right about now.
Our Rob Marciano has been keeping an eye on things for us in Kill Devil Hill. That's where Earl has already been. Kind of a rough night there. Also, Susan Candiotti is on Cape Cod, where Earl could be headed. Reynolds here in the studio with me, keeping a close eye on this storm. Let's go back to Rob. Rob, conditions right now a lot different than they were a just couple of hours ago and certainly overnight there for you guys, as well.
ROB MARCIANO, AMS METEOROLOGIST: Yes, it was a rough night. I'll tell you, around midnight, things really started ramping up. At one point, this hotel felt like it was moving bark and forth. Really coming down, both wind and rain. And now last couple of hours, it has been a little more sporadic, which is an indication that the storm is beginning to peel off and move a little bit farther away from us.
But the ocean behind me really has been relentless. That hasn't let up at all. It continues to pound ashore with big, big waves. We are getting up on high tide again. The water washing up to almost all of the way to the dunes there.
In areas for the south of here, it is a little bit more dicey as far as the landscape is concerned. And there has been reports of over- washing of the actual highway that connects this part of North Carolina to the southern Outer Banks of North Carolina. And those people are just going to have to wait it out until the storm completely goes by.
There's been reports of sporadic power outages. More consistent power outages down to the south. Some inland flooding in some areas. Also you know, we have this sliver of land on the other side of it. We got the ocean here on the other side of it. The west side is the sound. You can get some flooding from a little bit of storm surge from the sound -- we had those north winds. That's what we had this morning. Consistent north-north winds. Now a little bit lighter than they were a few hours ago. And as the storm pulls out, it'll go a little bit more westerly. We might see some more inland flooding from the south side.
But it feels drastically better, T.J. I can tell you that, than it was a just couple of hours ago. And if I could think back to what we were forecasting a few days ago - the National Hurricane Center really did a nice, nice job of forecasting this storm, directing it towards North Carolina. Quite frankly, scaring a lot of people. And that right turn happened just in the nick of time. It is heading off, hopefully to sea. Folks in New England, no doubt, are nervous now, for sure.
HOLMES: As well they should be. The danger is not gone. Yes, it's weakening. Yes, things might look better where you are. But still, this thing is out there and still could cause a problem.
Rob, we absolutely appreciate you, as always.
Reynolds, want to turn over to you now. He just talked about the good job done in forecasting this storm. Is it still right now doing what it is predicted to do?
REYNOLDS WOLF, AMS METEOROLOGIST: Absolutely. You know, at this point we are talking about during the last conversation we had on the air was -- how this has passed its prime. The storm is beginning to fall apart.
Still a force to be reckoned with. Winds are at 105. Guess at 125, it's a Category 2 storm. I would not be surprised by the time we get to our next update, if not before, this might be downgraded to a Category 1 storm.
You can see a lot of dry air moving into the western half of the storm. That intrusion will help break this thing apart. You still see some heavy rain bands there toward Washington, D.C., as far south as Cape Hatteras. Rob is not out of the woods yet in terms of the rainfall. You're going to see a little bit, but he's absolutely right. The main bulk of is pulling away from the Eastern seaboard.
Still, heavy waves can be expected; still some occasional showers and strong gusts can be expected along the coast. This storm, though, may retain a little bit of its power and a little bit of its -- may just stick together as at least a Category 1. At least, that's the forecast from the National Hurricane Center.
From later this afternoon, into the evening, as we get into tomorrow morning, 2:00 a.m., winds expected to be around 85 miles per hour. Gusts up to 105. There is a chance the storm could actually make landfall. Yes, landfall is indeed possible out by Cape Cod. And for that very reason, we have a hurricane warning that's in effect for the Cape Cod area. Strong winds can be expected there. Possibly in excess of 85 miles per hour. Some heavy rain and also some pounding waves can be expected.
And the effect this is going to have on air travel could be very big. Especially all across the Northeast corridor, including all your airports in New York, perhaps even Newark Airport; maybe even Logan in Boston. So, a frustrating day for a lot of people. But Rob's right. It could have been far worse.
HOLMES: Could have been worse. So far, so good in a lot of ways. We will see if we are still that lucky over the next 24, 48 hours. Reynolds, appreciate you. You want to head now -- Reynolds just said it could actually make landfall somewhere --
WOLF: Very possible.
HOLMES: It could make landfall, Susan Candiotti, about around exactly where you are right now. It looks pretty calm now. What are you seeing?
SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: It does. Here's where we are located on Cape Cod. If you make a fist, Yarmouth is right about here, as people like to say. Provincetown, a lot of you know, is up in that direction.
But you are right, T.J. Right now, it is calm. The sun has been peeking in and out. You can hear the sea gulls singing. Look at the waves -- barely any to speak of.
However, make no mistake about it. The state of Massachusetts has been working hand-in-hand with FEMA to get ready. They have already pre-positioned things like meals, food, water, tarps, generators. And even utility crews have been moved into the state from as far away from Michigan and Ohio to get ready for likely power outages.
And right now we are standing on top of a sea wall. It has been here a number of years, and some spots only about maybe thee feet high. But then as you go farther along here, goes up to six, seven, eight, ten feet, and that's because there are a lot of homes where you are looking in that direction now that are right up against the Nantucket Sound. So, we have been talking about a lot of people over the last couple of days who are ready to take on Earl.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Because of the storm, we decided we would pull our boat up a few weeks early. We would have taken it out early this season regardless, but we are just going a little earlier. Better safe than sorry.
UNIDENTIFIED FEMALE: The boat's on the mooring, and if it got loose, hit other boots and cause other damage. I feel better it being out of the water for now. It will be back as soon as possible.
UNIDENTIFIED FEMALE: From here, right across, this is the public beach which isn't very far. It is all wide open. Any of that -- trash cans or any of the signs or tree branches or anything like that could fly over here if the winds are strong. Hope we get nothing.
UNIDENTIFIED FEMALE: She is real panicky right now.
CANDIOTTI: Sure, I understand.
Well, if she is panicky, are you not a little panicky to be going over Nantucket Island where the storm is headed?
UNIDENTIFIED FEMALE: I don't care. I don't care.
UNIDENTIFIED FEMALE: You don't care?
UNIDENTIFIED FEMALE: No. I love it.
(END VIDEO CLIP)
CANDIOTTI: And off she goes on that ferry back to her home on Nantucket Island. We are standing in front of a home now. We haven't seen a lot of places boarded up or shuttered up like this one. But this one is well prepared for the approach of Earl.
And we can tell you this, very soon now, shelters are going to be opening up on Cape Cod. And they don't know how many people will show up, but they are going to be ready for them.
Also, authorities are going door-to-door after putting out prerecorded phone alerts to certain homes that live in areas that are prone to flooding. Could be dangerous for them. They are going to ask people that look, we are urging you to leaving and to pull out just to be to be on the safer side. It is not a mandatory evacuation, but people will be asked to move away from the shoreline if they can.
So, people are getting ready. They know the weather will turn but it's going to be late tonight and we don't know what to expect. Hopefully, the storm will stay offshore, and it won't be too much of a storm surge here.
T.J., back to you.
HOLMES: Well, that is the hope. Susan Candiotti keeping an eye on things for us there. Susan, we appreciate you and we'll certainly be checking in with you and our other reporters covering this hurricane for us.
We want to turn and take a look at some of the stories making headlines right now, including one story out of Miami. Scary story for just a bit there. The airport, many parts of it, had to be should down because of a scare. Bomb squad had to be called out, checking out a suspicious package. It was simply a metal canister, but fooled people and they thought it might have been a pipe bomb. But no sign of explosives here. We'll have a live report about this coming your way in about 15 minutes.
Also, these pictures are awfully dramatic. Look at this. They were just hanging out there waiting to be rescued. These were workers of that oil platform where there was a fire. This was in the Gulf. Had a lot of people concerned because we have seen a story similar to this just about five months ago with the oil disaster. But this situation, all the crew, they were rescued. No sign of any oil sheen out there as well.
Also, there is an agreement but not a peace agreement. There is an agreement to meet again, essentially. Another round of direct Middle East peace talks will take place September 14. This is the scene we saw yesterday. The first direct talks between the Israelis and Palestinians we have seen in some year-and-a-half. But again, they have committed to meet again in about two weeks. The goal, of course, being a peace deal within a year.
We do have those new unemployment numbers this morning. They reveal much more than the number of Americans who are just out of work. Economist Peter Morici will give us the bottom line on where the overall economy may be headed. He is coming up next. Stay here.
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HOLMES: It was just about an hour ago we got a critical new measure of the economy. The jobless rate picked up slightly last month to 9.6 percent from 9.5 percent the month before.
There are some glimmers of good news in here. Employers cut fewer jobs than expected, a total of 54,000 in August. That's about the same as the month before. Good news from that is that the 54,000 jobs lost in July, less than half of what was originally estimated.
So, are we going the right direction? Let's take a look at the latest unemployment numbers, what they mean to the economy and where we are headed. Peter Morici, an economist who has advised both governments and corporations. Also professor of international business at the University of Maryland.
Sir, always good to have you. I was talking to our Ali Velshi here a short time ago. He said people, you need to ignore that unemployment rate. That 9.6 percent. Just because it went up, don't let that fool you.
Do you agree with that, that sometimes we put too much emphasis on that number?
PETER MORICI, PROFESSOR OF INTERNATIONAL BUSINESS, UNIVERSITY OF MARYLAND: Well, yes. That's the household survey. They just call people up and say "Do you have a job? Looking for a job?" And that's a very variable number.
What really matters is the job count because that's employers, how many people you are paying, payroll taxes. We know that number is good. And that indicated we are in neutral. I mean, adding 50-some- odd thousand jobs in the private sector? We need to add over 300,000 jobs a month each and every month through the end of 2013 to pull unemployment down to six percent.
HOLMES: Now, neutral. You said we are neutral. That's certainly better than reverse. We would like to be going faster. But is this still -- just being in neutral -- is that a good sign?
MORICI: Not really. Earlier in the year, we were doing somewhat better. This raises the spectrum not such at the double dip. What really frightens me is not the double dip but rather stagnation, that we just never seen to get growing at more than one percent or two percent a year. The sustainable GDP growth that we saw in the last four quarters - you pull out, you know, the inventory adjustments and all of the statistical stuff, is only one percent to two percent. That's what is disturbing.
HOLMES: The private sector -- 67,000 jobs. We always put an emphasis on and we've got to see more private sector jobs. We lost all those census jobs from the government. We were expecting that. That 67,000 number, how does that make you feel?
MORICI: Not very good, 40,000 was in the health care sector. And is that really the private sector with so much of it being subsidized by the government. You know, it's sort of immune to the business cycle.
If you look at the private sector that you need to have recover, construction, manufacturing, and so forth, a little good news in construction, bad news in manufacturing.
Retail sales, again, the stores are shutting employees which means folks are not going to the mall. That's a leading indicator of where retail sales are going.
HOLMES: Now, Peter what do you expect to hear from the President? Someone trying to sell these numbers -- if you will -- and the President certainly wants to put a good spin on it. He'll or maybe -- reality as well. He doesn't to want to just fool people about what's going. We can see it.
But I mean how can the administration now take these numbers and make that argument that we are going the right direction?
MORICI: He shouldn't be faulted. But from Labor Day to Election Day, it's candidate Obama, not President Obama. So he's going to put the best possible light on. He is going to harp that the Republican Congress isn't doing enough to get the economy going and the Republicans in Congress holding up some of his initiatives.
He'll try to tell us that this is better than it was two years ago. And it is.
HOLMES: Yes.
MORICI: But the real question that Americans have to ask, is it good enough? So he'll try to put a good face on it and tell us we are better off than we were two years ago. But frankly, is that good enough?
HOLMES: There is going to be a debate that started. And you are starting to hear a bit of a drumbeat. But a -- a little news is coming out and in fact, possibly the administration looking into another round of stimulus. And some thought even before the first stimulus --
(CROSSTALK)
MORICI: Absolutely.
HOLMES: -- that $800 billion.
Oh, you want to answer this one already. And you know where the question is going. Can we throw more money at this problem? Do we need more money to stimulate this economy?
MORICI: More stimulus is not going to help. There's no reason to expect that a trillion dollars will work any better than the $800 billion we've already spent or are spending. The real issue is the big trade deficit.
The overvalued dollar vis-a-vis the Chinese yuan and the Indian rupee and so forth those are really holding back recovery in the industrial sectors of the economy. The tradable services, manufacturing, mining and so forth, that's where the real problems are in this jobs report. And we're not making any progress there.
The President if he wants to get the economy going again he's going to have to deal with China on the trade deficit. More stimulus, more, you know, weatherproofing projects and green buildings and the rest is not going to get us from here to there.
HOLMES: Yes all right, well, we are going to hear from the President. And we'll see if he addresses some of your concerns here shortly.
MORICI: Yes. HOLMES: Peter Morici, always good to see you. You enjoy your holiday weekend. All right, thanks so much for being here.
MORICI: Well --
HOLMES: All right, again like I said, we're going to be hearing from the President on those numbers. He's talking about it at the top of the hour. We'll bring you his remarks coming up live. The pictures of course, you're seeing here, are what we're keeping a close, close eye on, Earl. Hurricane Earl, still right now a Category 2. It is weakening. And expect it to continue to weaken. But right now not a whole lot of reports of damage and few reports of flooding. Also reports of power outages.
But so far it looks like we might have dodged a huge bullet, at least North Carolina. Our team of hurricane experts, our meteorologists, our reporters, everybody is out there. We have a whole team covering this story for you.
Stay with us.
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HOLMES: All right. We are following, of course, hurricane Earl here. A lot of people have on their mind hurricane-force winds right now. So a Rhode Island lab right now is testing building materials to see if they can withstand a hurricane's force. Look at this.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Ready?
(END VIDEO CLIP)
HOLMES: All right. What you're seeing there is -- this is a specially-designed cannon that is actually firing 2x4s at plywood. The board, the first one you saw, it went through the sheet of plywood, bounces off the other piece. Also you saw some tiny steel balls there going at windows.
Now, the window is treated with plastic. They hold the broken glass in place. So all of this is being done to figure out maybe how we can -- wow, a cannon that shoots 2x4s. Reynolds, that's fascinating. But again, this lab also tested shingles that you saw, pounding them with winds of 155 miles an hour. Maybe that stuff one day can help us all build better homes that can be hurricane proof, if you will.
But right now our reporters are out there and some of them certainly hurricane-worn and not necessarily hurricane-proof just yet; we're going to check in with all of them. Let's start with our Reynolds Wolf here in our hurricane headquarters with me -- go Reynolds.
REYNOLDS WOLF, CNN METEOROLOGIST: Well at least we have with Earl T.J., is that the storm is beginning to weaken a bit but still poses a massive punch possibly to parts of New England. We'll give you the latest on the system coming up in just a few moments.
ROB MARCIANO, AMS METEOROLOGIST: And I'm Rob Marciano in Kill Devil Hills, North Carolina, where it was a rough night last night as hurricane Earl scraped and pounded this shoreline. And things are lightening up just a little bit, but it's not over yet. A live report in the next hour.
BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: I'm Brianna Keilar on the boardwalk in Ocean City, Maryland. And we're still dealing or we are already dealing with some rough surf as you can see and waiting those tropical storm strength winds. But is it really going to ruin the plans of weekend vacationers here? I'll tell you coming up in a live report.
HOLMES: Reynolds, Rob, and our Brianna, part of our team here, I appreciate you guys. We'll be checking in with all of them and many other reporters throughout the morning and the day here on CNN.
And a lot of parents out there know bad study habits are pretty tough to break.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Is it too late? I mean, they're already in middle school. Have we already missed them all?
STEVE PERRY, CNN EDUCATION CONTRIBUTOR: That's a great question. Is it too late? No.
UNIDENTIFIED FEMALE: I mean, you know, we've established some very weak skills here.
PERRY: It's a great question. Is it too late because they're in middle school? The answer is absolutely not. In fact, this time and in high school when it's most important for parents to engage their children is the time they seem to want it the least that they need it the most.
(END VIDEO CLIP)
HOLMES: Principal Steve Perry keeps showing up at people's front doors and he is doing an education makeover. Has a list, things parents and students can do right now to start turning things around. He's spelling it all out for us. He's coming up in just a bit, our next hour of the CNN NEWSROOM. You don't want to miss him.
Stay here.
(COMMERCIAL BREAK)
HOLMES: Parts of Miami International Airport had to be closed and a bomb squad brought in and the person was in custody. CNN's John Zarrella is at the airport now for us. He's in Miami. John, tell us, are things back to normal now? Has this situation been dealt with?
JOHN ZARRELLA, CNN CORRESPONDENT: T.J., you can see here behind me it's quiet and that is good news. The airport reopened about 5:00 a.m. this morning, very little interruption to air travel here but it was closed for some eight hours beginning at about 9:00 p.m. last night.
Here's what happened. TSA screeners in the customs area found a piece of luggage and saw in that piece of luggage what looked like a cylinder shaped somewhat like a pipe bomb.
Immediately other authorities were called in. The airport was evacuated. Passengers were scrambled outside the airport. The bomb squad was called in. And what it turns out to be, at least according to what we were told by a source, was that the luggage belonged to a 70-year-old scientist.
Now when they went through and they checked at least first here what that device was no sign of explosive. The device has been removed and taken for further analysis to a laboratory. But right now they don't believe there was any explosive involved in that at all.
Now sources were telling us as well, the FBI saying that in fact, this man may have come in from Brazil on a flight overnight and that's when it was coming through and spotted. He was not arrested. He is fully cooperating with the FBI. They told us that during a statement here they gave a few hours ago, and that he was never arrested but just being questioned.
And this investigation does go on at this point, but the FBI did tell us it may be no crime was committed here -- T.J.
HOLMES: All right, always an abundance of caution. We've seen several situations like this at airports around the world. John Zarrella, we appreciate you as always. Thank you so much.
