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Fed Announces Latest Interest Rate Move Amid Inflation Fight; Services Underway For Memphis Man Beaten By Police; Lawyer: No Classified Docs Found In FBI Search Of Biden's Beach Home. Aired 2- 2:30p ET

Aired February 01, 2023 - 14:00   ET

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

[14:00:00]

ALISYN CAMEROTA, CNN ANCHOR: Also today, the FBI searched President Biden's summer home and Rehoboth Beach, Delaware. This is the third known search of one of Biden's properties as part of the investigation into his handling of classified materials. We're told that no classified documents were found during today's search. The White House press secretary will take questions on all of this and more soon.

VICTOR BLACKWELL, CNN ANCHOR: Meantime, the president will meet with House Speaker Kevin McCarthy next hour over raising the national debt limit. Republicans are demanding spending cuts but the White House insists raising the debt ceiling is not about future spending.

And let's begin in Washington, DC where the Federal Reserve has just announced its latest decision on interest rates. Economists predicted an eighth-straight rate increases if the Central Bank tries to tamp down inflation without causing a recession. CNN's Matt Egan is inside the Federal Reserve. Matt, what's the decision?

MATT EGAN, CNN REPORTER: 25 basis points, the Fed just delivered its a straight interest rate hike lifting interest rates to the highest level since 2007. All part of the Fed's quest to get inflation back down to healthy levels. But importantly, the Fed is dialing back the pace of these interest rate hikes going from 75 basis points this past summer and this past fall to 50 basis points in December to this more traditional move of 25 basis points today.

Now, this was widely expected, widely telegraphed, and yet it is a significant strategy shift nonetheless. The Fed is still trying to slow this economy to cool off inflation, but they've gone from slamming the brakes to just tapping the brakes. And that is a big deal because it lowers the risk of an accident caused by the Fed either in financial markets or in the real economy or both.

So, what does all this mean? Borrowing costs are going higher. They're going to stay elevated. We're talking about mortgage rates, credit cards, car loans, all of them have gone up sharply. No relief expected anytime soon. But this is also an acknowledgment from the Fed that they think their strategy is working, that all this tough medicine is in fact cooling off inflation. In fact, the Fed inserted a new line in the statement saying "inflation has eased somewhat, but remains elevated." So, this is the Fed's way of saying, look, we are making some progress, but we're not going to declare victory just yet. And the Fed kept in their statement a line saying that they do expect ongoing interest rate hikes are going to be needed to get inflation back down. During the press conference coming up in the next 25 minutes or so, Fed Chair Jerome Powell, he's going to be pressed on just how much higher he thinks interest rates are going to have to go and critically how long they're going to have to stay high, Victor and Alisyn.

CAMEROTA: OK, Matt, thank you very much for the breaking Fed news. Now, let's go to Memphis where a celebration of life for Tyre Nichols is about to start. The procession is underway. Family, friends, and civil rights leaders are gathering to remember the 29-year-old who was fatally beaten by five now-former Memphis police officers. So, let's listen to him for a second.

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CAMEROTA: All of them are charged with second degree-murder now.

BLACKWELL: Vice President Kamala Harris is attending the service. She's not expected to speak though. There's also the families of George Floyd, Breonna Taylor, who were there. Nichols will be eulogized by the Reverend Al Sharpton.

CNN national correspondent Ryan Young is outside the church there in Memphis, CNN senior climate justice correspondent Shimon Prokupecz is here with us with the latest on the investigation, including details on more new police recordings that will be released. But, Ryan, let's start with you there Memphis. What are you seeing there?

RYAN YOUNG, CNN NATIONAL CORRESPONDENT: Victor, tough day. Obviously, this is the community's first chance really to come out and kind of put their arms around this family. There have been news conferences but never before people have had the chance to come out and sort of surround this family and love all this with an ice storm that's hit the city and made it pretty hard to pass around this town that's why the funeral had to be delayed today. But when you think about this, outside of people protesting last week, this really gave everyone a chance to sort of show up and feel the common pain that so many people talk about.

We've had folks fly as far away as from LA to be here today to sit in this grief and also talk about how raw the emotions are watching another video where they feel policed did wrong by a young man who was just 29 years old. I look at the picture from inside that funeral and you can see him holding his child. So, you think about the life that Tyre had ahead of him that we'll never get to know what his life could have been. Listen to this man that we talked to from LA, talking about why he felt he needed to be here.

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(BEGIN VIDEO CLIP) NAJEE ALI, LOS ANGELES ACTIVIST: Well, to see a young black man be beaten to death by police, reminded me of the beating of Rodney King that happened over 30 years ago in LA. Being a friend of Rodney King's family, I wanted to show my support for the Nichols family. I'm here representing Laura King, the daughter of Rodney King.

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YOUNG: Yes. I don't think it's lost on any of us that how different this story would have been if the officers were a different color. So, I think something that people have been talking about is the change and the need and change in policing. So, some folks have mentioned that they're happy that the police chief was able to fire these officers, and the DA's office was able to charge them. But the question now is in a city that has experienced a rising crime rate, what are they going to do moving forward to be able to get people to the kind of justice they need while at the same time getting protection, especially under the color of law?

So, still so many questions, guys, as this funeral gets ready to get started. I will also tell you that the Secret Service has been in place for quite some time and people said they were happy that the vice president was coming to town to add more light and magnification to this ceremony.

CAMEROTA: OK, Ryan. Let's bring in Shimon. So, Shimon, is there new police video --

SHIMON PROKUPECZ, CNN Yes.

CAMEROTA: That's coming out?

PROKUPECZ: Yes. At some point, they -- we expect to see new video, new audio, the city saying they're going to release that once they're done with this administrative investigation that they do expect to see more officers disciplined or what they call charged. It can actually do --

CAMEROTA: But what's on the video here?

PROKUPECZ: I think it's going to be more body camera footage, and there's audio, so I don't know if that's audio from the radio transmissions. They're not being very specific right now. But certainly, they're giving indications that they want to be transparent. They want to release more information. But because of there is an ending -- because there's this investigation -- pending investigation that's going on, they need more time. And so, they're just asking for patience. But you know, they realize that they need to release more information because there are still a lot of gaps in what we know.

BLACKWELL: All right. Let's hold on for a second. We're going to go to the White House where the White House Counsel is speaking outside the White House on the FBI search. Let's listen.

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UNIDENTIFIED MALE: (INAUDIBLE)

IAN SAMS, WHITE HOUSE COUNSEL'S OFFICE: Sure. Thanks for the question. Look, I think that we're not going to get ahead of potential speculation and steps that could happen in the investigation. The president has been fully cooperative. And he's directed his team to be fully cooperative. And that's because he believes in the independence of the Justice Department. He believes in giving them the space to conduct a thorough review and to conduct that review efficiently that's why he's moving quickly to give them access to his home in Wilmington, to give access to his home in Rehoboth so they can do a full search so that they're able to get access to the information so that they can move ahead in their review. So, we're not going to speculate about potential things that may happen in the future in this investigation, but we've been fully cooperative, the president's been fully cooperative, his lawyers are in direct discussions with the Justice Department, and that's going to continue.

UNIDENTIFIED MALE: Why did it take so long for the search of the Rehoboth Beach residents to occur? And who today from the White House, if anyone was there?

SAMS: That's a good question. So, we've been working directly with the Justice Department from the very beginning, as soon as the initial set of materials was discovered at the Penn Biden Center, and it was reported to the Archives and the Archives notified the Justice Department about the finding. And we've worked -- the president's personal attorneys I should say, worked closely with the Justice Department to this process and the White House Counsel's Office as well. White House Counsel's Office was not present today to answer that question. And we've been following the Justice Department's lead and coordinating these searches with them. And so, you know, if you want to ask granular questions about the decision-making about the search, or the timing or anything like that, I'd refer you to the Justice Department.

(CROSSTALK)

UNIDENTIFIED MALE: A couple of questions, a couple of which are pretty simple. Just to be very clear. Has the FBI conducted any searches of any other locations associated with the president that you or the White House is aware of?

SAMS: Look, I think we're providing information as this goes on and answering questions about the search activities as they've been happening. I don't want to speak too much to the DOJ's practices in an ongoing investigation. I can say, you know that we have cooperated fully. The president's personal attorneys have provided information to DOJ. We've addressed openly and directly the searches that were conducted first at the president's Wilmington residence and then today at the Rehoboth residents. You saw in the statement that was released by the president's personal attorney for example, that no documents with classified markings were found in Rehoboth today.

And so, you know, we're going to continue to try to provide information as this investigation goes on and ensure that you guys have the ability to share with the American people sort of the information that is important for them to see as the president is cooperating with this investigation. So, I don't -- so I want to be very careful to respect the integrity of that investigation. Not speak too much to the Justice Department's decision-making and their activities. But as it's appropriate like we did today, if we have information to share about activities that have been conducted, we will do that.

UNIDENTIFIED MALE: But just to be very clear about this. It's nor --

SAMS: Go ahead, Frank.

[14:10:00]

UNIDENTIFIED MALE: Let me --

SAMS: OK.

UNIDENTIFIED MALE: let me follow up just quickly if I can very quickly. I'll ask a separate question. They can follow up on that. Did anyone at the White House at any point tell the National Archives in any form that they could not release a press release about the discovery of classified documents?

SAMS: What are you -- what's that in reference to?

UNIDENTIFIED MALE: There's reporting that came from the House Oversight Committee Chairman, James Comer, who says that, in his conversations with the National Archives, they communicated that they were told -- the archives were told it could not release a press release, and whatever point it was about the discovery of classified documents. Had anyone at the White House told them not to do that?

SAMS: Yes, I don't know anything about it. If that's actually what he said, it's probably better to ask the archives if that's actually what was said and try to understand a little bit more what he meant. Josh.

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UNIDENTIFIED MALE: In my -- in my first question you didn't say, though, you could --

SAMS: Josh, go ahead.

UNIDENTIFIED MALE: Whether the FBI -- you just can't -- can you just -- can you answer yes or no -- yes or no?

SAMS: I gave an answer to that question, Josh.

UNIDENTIFIED MALE: (INAUDIBLE)

SAMS: Look, the Justice Department is engaged in an ongoing investigation, an ongoing investigation I should add that the president has been fully cooperative in, offering unprecedented access to his home in Wilmington, to his home, every single room of his home and Rehoboth as well as the one in Wilmington, and giving them access to the information they need. He's moving quickly, to get them the information that they need, I'm going to be really careful not to characterize what the Justice Department is doing in their investigation, probably more appropriate for a question like that, to be asked to the Justice Department, so I would point you to them.

(CROSSTALK)

UNIDENTIFIED FEMALE: Sir, does the White House plan to comply with the House Oversight Committees' records request?

SAMS: Can you say a little bit more about that?

UNIDENTIFIED FEMALE: The House Oversight Committee is asked for communications regarding this, it's also asked to see the documents that were found, do you plan to give those records to the House Oversight Committee?

SAMS: So, yes. We received a few letters from the House Oversight Committee in recent weeks. We actually gave them a response letter earlier in the week -- or excuse me, last week, I should say from the White House Council, we're engaging in good faith with them, have reached out to the committee staff to ensure that we are being responsive to these requests. Obviously, when you're in an ongoing investigation like this with the justice firm that you're fully cooperating with, you know, you want to protect the integrity of that investigation and take safeguard information from the investigation to protect, you know, the law enforcement you know, decision making and things like that. But we're in communication with the Oversight Committee. We're being -- we're operating in good faith with legitimate oversight requests.

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UNIDENTIFIED MALE: With what Peter was asking, are there any conversations with the Justice Department about certain other areas that former President Biden -- former Vice President Biden was working in after he left office though? I'm talking about the University of Pennsylvania, any place there might be documents.

SAMS: So, you know, the president's personal lawyers address sort of the process of identifying, you know, locations where materials from the VP years could have been stored. They've been working in open consultation with the Department of Justice. I'm not going to speak to the sort of decision-making that the Justice Department is going to make about how to conduct their investigation. That certainly would be more appropriate to be asked of them, as opposed to us.

But you know, we're being fully cooperative. We're offering up access to the president's personal homes. You know, we've been cooperative with the Justice Department ensuring that they have access to the materials and handing any materials that are found over to the Justice Department like initially was done with the National Archives. So, we're going to continue to be cooperative with the Justice Department throughout this. Scott.

UNIDENTIFIED MALE: (INAUDIBLE) notes twice now, the FBI has taken -- you know, what he described his handwritten notes. Can you think of any explanation for the president's lawyers or the White House why those notes aren't in print? I assume they're not taking every single hand-written note come across in the house. What is it in particular, about both times the hand-written notes that they've taken will be different?

SAMS: Well, I think you see today in the statement that was released by the president's personal lawyers, in the statement that was released by the president's personal attorney after the search of the Wilmington house, you know, I think they believe that you know, some of the materials that we're seeing and were taken, they appear to relate to his time as vice president. I think that you know, they want to make sure that the Justice Department has access to the information that they need to sift through materials as part of this ongoing investigation. So, you know, I'm not going to characterize too much of the underlying contents. But you know, I think we've spoken to why certain materials may have been taken and what they could have related.

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UNIDENTIFIED MALE: You said the surface plant, how long was it planned for? Were there any parameters for the search? You said they searched everything on the property. And then the other question, was there any reason that anybody else in the Biden family would have also had access to the same documents?

SAMS: Yes, I'm not going to speak to sort of the negotiations or discussions or collaborations between the president's personal attorney and DOJ in establishing the search. We're cooperating fully with the Justice Department -- we're cooperating fully with the Justice Department and ensuring that they have access to the house, the Rehoboth house today, the Wilmington house previously to be able to do a thorough search. And it's because the president is moving quickly to get them access to the information that they need so that they can move forward with a thorough review. That's thorough, and it's done efficiently. Zohan? (PH)

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UNIDENTIFIED MALE: I just want to follow up on the handwritten notes. Is the White House aware of what specific what they actually are and what they contain? You're saying they may say something about his time as vice president. What level of sensitivity might be contained in those handwritten notes?

SAMS: That's a good question. And I'm just not going to be able to speak to the underlying contents of what the Justice Department may be looking at as part of their ongoing investigation. But look, I'll say, again, you know, as they move forward with this investigation, the president, his attorneys, the White House certainly are going to be fully cooperative with that. We're following their lead to ensure that they have what they need in order to conduct a thorough review.

UNIDENTIFIED MALE: Have they told you go -- have they told specifically --

SAMS: I'm not going to speak to the DOJ.

(CROSSTALK)

UNIDENTIFIED MALE: At this point, what is the total number of documents bearing classified markets that have been turned up in part of the investigation?

SAMS: That's a good question. I think that that's probably a more appropriate question for the Justice Department. I don't want to characterize sort of what they're reviewing and how they're going through all that. All right, thank you, guys.

(CROSSTALK)

(END VIDEOTAPE)

BLACKWELL: All right, you've been listening there to a spokesman from the White House Counsel's office after an FBI search at the president's beach house in Rehoboth, Delaware. It's the third FBI search for documents with classified markings. According to the president's private attorneys -- his personal attorneys, I should say, there were no classified documents found but there were some handwritten notes that were collected there by the agents.

Let's bring in CNN's Paul Reid, Jeremy Diamond, also Joshua Skule here, a former senior official at the FBI, who is now president of the Bow Wave LLC. So, Paula, first. Let's start with what you're learning about the search today.

PAULA REID, CNN SENIOR LEGAL AFFAIRS CORRESPONDENT: Well, Victor, the good news for the president and his team is that no additional classified materials were found at this property today. But the bad news is that this is the second time in just two weeks where there have been federal investigators at a house owned by the president. Now, today's search as with the search of Wilmington home about two weeks ago, this was done in coordination with the cooperation of the president's team. And this was planned.

Now, the president's personal team had already searched both of these houses. But once this became a full-blown special counsel investigation, it was very much expected that the FBI would want to do their own searches. So, on the 20th of January, we saw the FBI spend about 13 hours in the president's Wilmington home. They found additional classified information there. The big question today is whether they find anything else. And good news again for the president, they did not.

But two outstanding questions right now, will there be any other searches? Well, you heard the White House Counsel spokesman right there, he was asked that, and he really dodged that. He made a pretty wide dodge around that question. And there been a lot of questions about how transparent the president's team has been because just yesterday, we learned about a previously undisclosed visit that the FBI made to that former office where this all began, and a lot of questions about why the Justice Department nor the president's team had previously disclosed this, especially because it was a pretty standard step when assessing a situation like this.

Another important thing that the White House Counsel spokesman touched on that I think is fair is clearly everyone is trying to move really quickly here. Today, it was Robert Hur, the special counsel's first day on the job, but they've already completed these two searches. And it appears there is a lot of desire here to move this along as quickly as possible.

CAMEROTA: Josh, as you know, when it was first revealed that classified documents were found at President Biden's former office and home, a lot of Republicans were saying where's the FBI raid? Where's the FBI raid? Why is there you know, unequal treatment between Donald Trump and Joe Biden? Well, now, the FBI has searched President Biden's properties. But is there a difference between these two things?

JOSHUA SKULE, FORMER FBI EXECUTIVE ASSISTANT DIRECTOR FOR INTELLIGENCE: Well, I think there is a difference between these two things. One, for Mar-a-Lago there was a required search warrant, we have reported that there was potential obstruction of justice, which means the movement of potential evidence or destruction of evidence. In this case with the current president, you have cooperation, a report to the National Archives, and then a thoroughness that continues to evolve the process. And I think a lot of folks are getting -- two things conflated. They're seeing the investigative process play out publicly, investigators would hope that that didn't happen, and then you're seeing a potential PR crisis. Those two things are not mutually inclusive.

BLACKWELL: Jeremy, when Kate Bedingfield, the White House Communications Director was on yesterday, she said essentially, the American people don't care much about this. They care about, of course, inflation. And she listed a few other important issues. What should we deduce by the White House putting out this spokesperson from the White House Counsel's Office that maybe they think this is of greater interest than they're saying in front of the curtain?

JEREMY DIAMOND, CNN WHITE HOUSE CORRESPONDENT: Yes. I think frankly if you look at the timing of this, this is more about trying to take out some of the pressure in the briefing room. We're expecting the White House press secretary Karine Jean-Pierre to brief at about 2:30 p.m. today.

[14:20:04]

And so, they wanted to try and get some of these questions from reporters about today's search out of the way. But a very intentional choice there by the White House to have Ian Sams, the spokesman for the White House Counsel's Office appear in front of the West Wing entrance of the White House and not with -- at the briefing room podium with the seal of the White House behind him. That's a very intentional choice to try and put some distance as we've seen this -- how this has played out so far, some distance between the White House's official activities and this ongoing investigation of the president.

But today, of course, there were a lot of questions from reporters. I don't know that there were many more answers than when we've seen the White House press secretary have to parry a lot of these questions herself. Ian Sams, the spokesman for the Counsel's Office would not say if other searches had been conducted by the FBI. He wouldn't confirm this FBI search that we reported on yesterday of the Penn Biden Center back in November, directing those questions to the Department of Justice. And he also couldn't speak to the contents of the notes that were found today by the FBI and that were taken into their possession from that Rehoboth home. So, there are still a number of questions remaining here.

And the overall emphasis here was to say we are cooperating -- we are fully cooperating. He must have said the word cooperation or cooperating a dozen or more times there. And that is really where they want the focus to be is on their cooperation with the DOJ to try and distinguish things from how former President Trump has handled his investigation.

BLACKWELL: Jeremy Diamond, Josh Skule, Paula Reid, thank you.

CAMEROTA: OK. So, next hour, President Biden and Kevin McCarthy are going to meet for the first time since McCarthy became House speaker. They're going to talk about the looming debt ceiling crisis. We will preview their sit-down next.

BLACKWELL: And in just minutes, we will take you back to Memphis where the funeral service for Tyre Nichols is happening right now. Stay with us.

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UNIDENTIFIED MALE: I want to invite you in these moments to silently read the obituary that is printed and as well give your attention to the screens and receive this pictorial tribute.