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Slew Of Nations Halt Flights From S. Africa Over New Variant Fears; Black Friday Shoppers Face Higher Prices, Supply Chain Issues; Rep. Omar Slams Boebert Over Making Up Anti-Muslim Story. Aired 11- 11:30a ET

Aired November 26, 2021 - 11:00   ET

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

[11:00:00]

ALEX MARQUARDT, CNN ANCHOR: I'm Alex Marquardt in today for Kate Bolduan. Thanks again for joining us on a special holiday edition of CNN NEWSROOM.

And we are going to begin with breaking news on the COVID-19 pandemic. A new variant first identified in South Africa has scientists alarm today and a slew of countries are taking action to protect themselves. Health officials are warning that the new variant spreads rapidly and could have an ability to evade immunity.

They're going to be briefing the World Health Organization today about the new variant, which appears to be behind a huge surge in coronavirus cases in South Africa. A number of European countries including the U.K., France, and the Netherlands are now banning travelers from South Africa and the surrounding region. Meanwhile, markets around the world are down sharply as results, including here in the United States with travel stocks especially hard hit.

Let's begin our coverage with CNN, David McKenzie, who is live in Johannesburg, South Africa. David, what are South African officials saying about this new variant?

DAVID MCKENZIE, CNN CORRESPONDENT: Well, Alex, what they're saying is that they needed to bring the attention to the world, this variant because of its troubling characteristics. On one side, it's got the very many mutations particularly on the spike protein, which could mean they say that it might evade immunity from previous infection and have some impact, though it's unclear what on vaccine efficacy.

It is very early days on this. And that is why they said they want it to come out publicly when the health official just a short time ago telling CNN, that they're being punished now because of their transparency. All across the world, there are countries now banning travel starting with the United Kingdom, banning travel from this region, and other parts of the continent because of the threat these countries say of this possible variant of concern.

So far, it hasn't been designated by the WHO that could come in the coming hours. There have been positive cases of this variant discovered here in South Africa, neighboring Botswana. In Israel, several cases, and now Belgium saying that they identified a case from a traveler from Egypt, France, because of that is bolstering its border controls.

So a lot of developing movement on the story of this possible variant that is going to be concerning scientists in the coming days, they will get a better sense in the lab, whether it does evade immunity. And that will be the moment where we will know, Alex, if this is something to be very worried about or if this is a false alarm. Alex?

MARQUARDT: As we mentioned, they will be briefing the WHO, there will be many developments in the coming hours and days. And David, we know you'll stay all over that. David McKenzie in Johannesburg, thanks very much.

Now, as we mentioned, this alarming news of this variant has rattled stock markets around the world. So you can see all those numbers there in the red. U.S. stocks down sharply at this hour, oil also weighed down on fears that demand could be severely impacted. CNN's Matt Egan is following how investors are reacting to this breaking news. Matt, we're seeing major jitters in the markets this morning.

MATT EGAN, CNN BUSINESS REPORTER: Yes, absolutely, Alex. COVID fears are definitely back on Wall Street in a big way. The Dow down more than 900 points around 2.5 percent on track for its worst day since October of 2020. The S&P 500 is down around 2 percent. That is another big move.

The big worry here is that the new variant could slow down this roaring economic recovery. That's why we're seeing oil prices down at this moment, 11 percent. Oil is very sensitive to swings in the economy. It's now at $75 a barrel. Just a couple of weeks ago, it was at $85 a barrel.

Now investors they're getting out of travel stocks, we've seen airlines, hotels, cruise companies, Airbnb, all take a big hit. They're also putting money to work instead home stocks, Netflix, Teladoc, Zoom, all of them are up as well. Now we do have to emphasize there's so much we just don't know yet. How effective are vaccines going to be against this variant? How quickly does the variants spread and what our governments and society going to do about this?

Now I asked Mark Zandi of Moody's about what kind of risks the variant poses to the economy. And he told me it isn't difficult to construct dark scenarios around the economic threat posed by this new variant. And while it is prudent to consider these scenarios, it is much too premature to jump to them.

Alex, where do we go from here on Wall Street will be dictated by of course what happens with this variant. For now, investors are clearly selling first and asking questions later.

MARQUARDT: All right, those markets back open today after a break for Thanksgiving and not responding well to this news. Matt Egan, thanks so much.

As Matt just mentioned, there's so much that we don't know so to get to what we do know, what we're learning, joining me now is CNN medical analyst Dr. Leana Wen. She is also the former health commissioner for the city of Baltimore. Dr. Wen, thanks so much for joining me this morning, there's so many questions.

[11:05:10]

DR. LEANA WEN, CNN MEDICAL ANALYST: There are, Alex. And what I would want to know and actually what we're all looking for when it comes to the -- this new variant, as well as any other new variant are three things. One is, is it more transmissible, which means that if it's more transmissible, it could displace all the existing variants and then really take over as we saw with the Delta variant.

The second is, is it more virulent? Does it cause more severe disease? That is something we do not know at this point? And the third question, very importantly is, does this new variant evade the protection of existing vaccines? Now, there are some concerning signs that it could because of the large number of mutations that it contains. But we do not know this at this point. And this is why it's so important for us to conduct the studies that will help us to get to that point of understanding. Will our existing vaccines work on this new variant?

MARQUARDT: Doctor, given what we do know already and of course, that is going to be the major question how they respond to the vaccines. But given what we do know in terms of all these mutations, in terms of this early signs of perhaps about their transmissibility, what concerns you the most, in these early hours?

WEN: Well, it's the combination of these two things because if it in fact, is a lot more transmissible, it could displace even the really contagious Delta variant. And if in fact, it does evade the protection of our vaccines, then we may need to start over with our vaccination campaign, which is something that no one wants to, to add to consider.

I will just say, as someone who has lived and worked in South Africa that we really should be thinking the South African scientists on authorities for coming out so quickly and so transparently with this information, because it allows the rest of the world to prepare.

And while I do understand the travel bans, and the reason why countries are taking proactive steps, I can also understand the perspective of people in South Africa who are saying, why are we being punished for being transparent with this information, when so many other countries don't haven't done the work necessary to even find out if they have new variants of concern.

MARQUARDT: Yes, as you mentioned, there are a number of countries that have started already imposing travel bans. The U.S. is not one of them, not just on South Africa, but around countries in southern Africa around South Africa. Dr. Anthony Fauci was actually asked about this this morning on CNN, about whether the U.S. should follow suit, follow those other countries that have already done that, here's what he said. Take a listen.

(BEGIN VIDEO CLIP) DR. ANTHONY FAUCI, CHIEF MEDICAL ADVISER TO PRESIDENT BIDEN: Obviously, as soon as we find out more information, we'll make a decision as quickly as we possibly can. You always put these things on the table. But you don't want to say you're going to do it until you have some scientific reason to do it. That's the reason why we're rushing now to get that scientific data to try and make an informed decision about something like that.

(END VIDEO CLIP)

MARQUARDT: So Dr. Wen, given what little we do know, do you think a ban would be appropriate at this point for the Biden ministration to impose?

WEN: It's really difficult, there's no easy answer here because on the one hand, we don't know much about this new variant yet. And so might we be rushing ahead of the scientific studies. But on the other hand, we here in the U.S. have always been behind during this pandemic. And there is an argument to be made about using an abundance of caution, taking proactive steps.

And I would just say that if the U.S. were to impose a travel ban, we should also be very quick to remove the travel ban, once we get more information as well. And that was something that us was very slow to do. Once you find out something, then you should take action. But also once you find out that the threat may have receded, you also need to take the steps to remove those restrictions as well.

MARQUARDT: And Dr. Wen, you know well, throughout this pandemic, we have often looked eastwards here in the U.S. to Europe for perhaps a preview of what may be coming, a WHO official is warning that what they're seeing now in Europe could be what's in store for the Americas. This official said quote, time and time again, we've seen how the infection dynamics are in -- those dynamics in Europe are mirrored here.

Several weeks later, the future is unfolding before us. And it must be a wakeup call for our region because we are even more vulnerable. Dr. Wen, how true do you think that is?

WEN: I completely agree with that official. And that's another reason why I'm -- I and so many other public health experts here in the U.S. are really concerned. We're seeing a rising number of cases here in the U.S. already. We're already seeing patterns similar to countries in Europe that actually have higher vaccination rates than we do. And yet, unlike Europe, we are not taking steps that increase our level of alarm.

At this point we really should be bringing back indoor masking, especially in crowded places where there are a lot of people around us of unknown vaccination status. We should be putting out the alert for everyone to get their booster doses that this is not something that's a nice to have. This is something that everyone needs to have at this point in order to protect themselves but also to potentially stem a further surge of the COVID-19 virus.

[11:10:16]

I mean, I know we have this new variant that is of unknown significance in South Africa. But we have the Delta variant right here in the U.S. that could once again take over and we have to take every precaution in the meantime.

MARQUARDT: And doctors like yourself across the board are saying the only thing we know now for sure, the best thing we can do now for sure is to get vaccinated, get boosted if you've already been vaccinated. Dr. Leana Wen, thank you so much for your time this morning.

WEN: Thank you.

MARQUARDT: And coming up, it is one of the busiest shopping days of the year. But how are the pandemic, inflation, and supply chain issues impacting today's Black Friday details and a live report that's coming up next.

(COMMERCIAL BREAK)

[11:15:30]

MARQUARDT: With Thanksgiving over Black Friday is now here, holiday shoppers are facing higher prices, fewer discounts and many items out of stock both online and in stores. Covering all of this is CNN's Alison Kosik who live outside of Macy's flagship store in New York City. Alison, what are you seeing and hearing from shoppers there today?

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Alex, hello to you. It's feeling pretty festive here in Herald Square at Macy's. People are shopping. The holiday lights are out. The window displays are out. And people are spending money despite the fact that we are paying more for just about everything.

In fact, the National Retail Federation expects holiday spending to break records this year that consumers are expected to shell out anywhere between 843 to $859 billion by the time we finished the holiday shopping season. As you said today is Black Friday, the unofficial start of the holiday shopping season, 108 million people are expected to shop today, 60 percent of those people expected to actually go inside stores and shop inside stores.

This is a divergence from what we've seen in past years even before the pandemic, many people flocked to their computers to do online shopping. This year, they want to go inside because there's less confidence that the items that they ordered online will actually get to where they need to go in time because of massive supply chain issues globally that have affected retailers and affected how much inventory they could actually build up.

Which retailers did best? Well, it becomes a winners and losers kind of list. Some of the winners Target, Walmart, even Macy's, they were creative in building up their inventories ahead of time even chartering private cargo ships to move their products across the globe. I spoke with the CEO of Macy's earlier today about this. Listen.

(BEGIN VIDEO CLIP)

JEFFREY GENNETTE, CEO, MACY'S: We moved up ship dates by 30 days to ensure that we would have it here for the holiday. That's really helping us get all of our stock into our warehouses and our stores. So across all of our gift categories, we're well positioned this holiday season.

(END VIDEO CLIP)

KOSIK: The downside to all this demand and low supply, it means fewer door busters and fewer big discounts when you go shopping, Alex.

MARQUARDT: All right, Alison Kosik in New York. And of course, tomorrow is small business Saturday. And those are some of the businesses that have been hit hardest in this pandemic. So Alison Kosik in New York, thanks very much.

Joining me now to discuss this further is Catherine Rampell. She's a CNN economics and political commentator and economist for The Washington Post. Catherine, thank you so much for joining us.

CATHERINE RAMPELL, CNN ECONOMICS AND POLITICAL COMMENTATOR: Great to be here.

MARQUARDT: I want to talk about all of these major economic factors that are colliding in this moment that will have an impact on this holiday shopping season, whether its supply chain struggles to inflation and the labor shortage. What are the expectations for retail sales in the coming weeks in this holiday season? And where do you think it'll -- what do you think it will tell us about where the economy is?

RAMPELL: Expectations for retail sales are incredibly strong right now. And in fact, they have been quite strong already in the past few months leading up to the holiday shopping season. This is a function of multiple factors, one of which, of course, is that Americans are sitting on a lot of cash they saved.

They had some forced savings last year, as much of the economy was shut down. Their incomes actually went up it partly a function of the fact that there were big government transfers things like the stimulus checks, as well as the child tax credit. They're eager to spend. And they're shifting more of their spending behavior towards goods towards stuff and away from things like travel or other in person services that might be still seen as somewhat risky.

All of that puts -- put together suggests that we will continue to see really high demand from consumers, particularly in the big Christmas shopping season.

MARQUARDT: And you write in a new column about inflation, which we've been discussing so much lately, because we have seen all these prices going up on groceries and on gas. And you argue that when you look at inflation, the corporate greed is not behind that. Explain that. RAMPELL: Well, look, corporations are always greedy. That's their job. They're out to make a buck. They're not greedier today than they were a year and a half ago when inflation was quite low. What's happening, what happened then, what happened now has to do with demand and it has to do with supply factors. Last year, in the early days of the pandemic, demand was quite weak.

Of course, there were, you know, system wide shutdowns basically across the economy, people were hunkering down and not buying stuff. Now, they're eager to spend, they're chasing any inventory that's out there, that's both driving up prices, as well as making things stock out.

[11:20:15]

Companies turn out to do very well, when there is high demand, right? People are buying everything that they have to sell. And then they have to spend a little bit more to procure that extra bit of inventory, which is often more expensive to procure. So all of those things put together suggest that that's driving up prices, again, it's the supply chain issues as well.

The global supply chain has been somewhat disrupted, continues to be disrupted by the pandemic, and then you have, you know, lots of consumers clamoring over each other to buy things that leads to higher prices, it also leads to higher profits.

So yes, corporations are greedy. They were greedy last year, they're greedy this year. But this is just a function of these very weird supply and demand dynamics that we're in right now that lead to both higher prices and higher profits.

MARQUARDT: And as we just mentioned, the prices on gas are going up in this moment, and President Biden has pointed to oil and gas companies. He's also ordered the FTC to investigate whether those companies are illegally raising prices. And then perhaps most importantly, he announced the release of these 50 million barrels of oil from the Strategic Petroleum Reserve. That's not expected to impact gas prices immediately. But when do you think the average American driver is going to start seeing the benefits of that move?

RAMPELL: Well, oil prices have already been falling for about the past month. And there's almost always a lag between when oil prices fall on the one hand and when those get passed through to consumers at the pump when they buy gasoline.

So I think we will start to see that soon. And then of course, we also saw today market somewhat freaking out over this new variant of the coronavirus that has been especially emerging in South Africa that has driven oil prices down further, or at least the last I checked before I went on T.V., you talk about it.

So that will drive oil prices down that may also drive down gas prices eventually, I mean, we'll have to see what happens in the next few days. But again, these dynamics are being driven by the pandemic. They're being driven by the very weird things happening with demand and supply because of the pandemic. And you may ultimately see gas prices go down but not for the most desirable reason.

MARQUARDT: All right, we're going to leave it there. Thank you so much for breaking that down. And as we say goodbye, you can see there the Dow Jones now down more than 1,000 points reacting to this news about the new COVID variant, our thanks to Catherine Rampell.

Coming up, another Republican lawmaker under fire for an anti-Muslim set of remarks about a colleague what will Kevin McCarthy do about it? We'll discuss that next.

(COMMERCIAL BREAK)

[11:27:43]

MARQUARDT: Now to this developing story, Democratic Congresswoman Ilhan Omar is slamming her Republican colleague Lauren Boebert from Colorado over horrific anti-Muslim remarks of Boebert made caught in a video that has now gone viral. Take a listen.

(BEGIN VIDEO CLIP)

REP. LAUREN BOEBERT (R-CO): I was getting into an elevator with one of my staffers. And he and I are we're leaving the Capitol. We're going back to my office and begin the elevator and I see a Capitol Police Officer running currently to the elevator. I see fret all over his face. I look to my left. And there she is, Ilhan Omar. And I said well, she doesn't have a backpack, we should be fine. So we only had one Florida go, and I was like, I will say it will not, and looked over. And I said I look, hotspots decided to show up for work today.

(END VIDEO CLIP)

MARQUARDT: The Republican congresswoman talking about a colleague being a potential suicide bomber.

Joining me now is CNN Capitol Hill reporter Melanie Zanona. Melanie, we've heard this kind of thing from the congresswoman before she's talking about the jihad squad, et cetera but talking about carrying a bomb in a backpack that just is beyond the pale. Do you think there's any chance that Republican Leader Kevin McCarthy is going to react to this or is he just going to let it slide as he so often does?

MELANIE ZANONA, CNN CAPITOL HILL REPORTER: Yes. I have zero reason to believe that Kevin McCarthy is going to bring the hammer down on Lauren Boebert over this. We have asked his office for comment. We haven't heard back yet. But just look at what happened last week with Paul Gosar. He was under fire for posting a video on Twitter depicting violence against Democrats and McCarthy and the GOP stood behind him.

I mean, in fact, McCarthy said that he would reinstate Gosar and Marjorie Taylor Greene to their committees, potentially even better ones if Republicans win back the House. And one factor playing into all of this, Alex, is the potential future speaker's race because McCarthy needs these Trump allies like Lauren Boebert like Paul Gosar like Marjorie Taylor Greene to become speaker. I mean, they really could be decisive votes, depending on the party's margins. And they're making clear that they're not willing to hand over the votes unless McCarthy conforms to their demands and defends them strongly against these Democratic potential threats to censure them or kick them off their committees.

[11:30:02]

MARQUARDT: Yes, politics, trumping political courage. We have heard from Congresswoman Omar. She's responded on Twitter.