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Biden: Jobs Report Means Economy Moving In Right Direction; Silicon Valley Bank Failure Rattles U.S. Markets; FDA: Mammogram Centers Should Tell Women If They Have Dense Breasts. Aired 2:30-3p ET

Aired March 10, 2023 - 14:30   ET

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

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[14:33:16]

BIANNA GOLODRYGA, CNN HOST: Yet again, the U.S. labor market outperformed expectations and added more jobs than forecasted.

VICTOR BLACKWELL, CNN HOST: And 311,000 jobs were created. And the unemployment rate rose slightly to 3.8 percent.

President Biden touted the numbers as a win.

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JOE BIDEN, PRESIDENT OF THE UNITED STATES: That means, overall, we created more jobs in two years than any administration created in the first four years. And I think all of this matters. It's no accident. It means our economic plan is working.

People who are staying out of the job market - this is particularly good news - are now getting back into the job market. They're coming off the sidelines. They're getting back into the job market.

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BLACKWELL: CNN's Matt Egan is here with us now.

What does this mean for interest rates potentially and inflation?

MATT EGAN, CNN REPORTER: Victor and Bianna, this jobs market remains hot, surprisingly hot. Look at the numbers, 311,000 jobs added in February.

Now this is a slowdown from January. But make no mistake, this is strong growth, especially after all these jobs added in the past year or so.

Where are these jobs, where we're seeing rapid hiring in leisure and hospitality, bars and restaurants, retail. Government also adding jobs.

The unemployment rate did tick up 3.6 percent. But remember, this is off of a 53-yeawr-low, set just last month and a major improvement, despite a nearly 15 percent in 20 percent in 2020.

Where does this leave up as far as the jobs market and inflation? The White House was hoping for a Goldilocks number. Not too hot to signal overheating, not to cool that would signal bigger problems in the economy. I think we got a mixed number. Clearly, hiring is hot.

[14:34:59]

But we also got a slowdown in wages, the slowest pace of wage growth in a year. Workers won't like that. But it's good news for the Fed.

Also, the supply of workers, as President Biden mentioned, that is improving. This is the labor force participation rate. It crashed during Covid. It's slowly improving to the best levels since March of 2020.

What does the Fed do with all of this? Today's report keeps alive the risk of a 50-basis point rate hike later this month.

Here's why this matters. This chart shows, in the blue line, is where rates are. And the gray shaded are the recessions.

You can see recessions often, but not always follow Fed rate hiking cycles. We've seen that in the past. Of course, the 2020 recession was caused by a health crisis.

The issue is, the higher rates go, the greater the risk something goes wrong in the economy.

GOLODRYGA: Meantime, major development in the banking world. The FDIC just reported the California regulators shout down Silicon Valley Bank, a big lender out in California, after reporting a loss of over $1 billion. It appears a run-on bank.

People are wondering if the FDIC back in 2008. What's going on?

EGAN: Yes, this really is an earthquake, especially for the tech community.

Silicon Valley Bank dropped by 60 percent yesterday. Today, California regulators have shut this lender down.

This is the biggest failure since 2008, the second biggest failure ever since Washington mutual in September of 2008. This is a major lender to tech start-ups.

The FDIC said insured depositors will have full access to insured deposits by Monday morning. Insured deposits, that means up to $250,000.

We know that some small businesses, some startups, some individuals have more than that $250,000. It's not clear if they'll get all their money back.

This is not sitting well in the marketplace. We see the Dow is down by more than 250 points. Banks are leading the way lower. The good news here is experts I'm talking to are hopeful that this is an isolated incident, that this is not part of a broader systemic issue.

Mark Zandi told me, the chief analyst at Moody's Analytics, he told me he doesn't think this failure is symptomatic of a broader problem in the banking industry.

Let's hope not. That's the last thing we need.

GOLODRYGA: The major banks saying they are well capitalized.

Matt Egan, thank you.

BLACKWELL: Robert Reich, former U.S. labor secretary under President Clinton, is with us. Also the author of "The System, Who Rigged It and How We Fix It."

Secretary Reich, always good to have you.

Let's start where Matt ended, with this Silicon Valley Bank. The FDIC now in control. There were some stumbles from Wells Fargo, JPMorgan Chase, Bank of America.

What does this mean for people outside of the Silicon Valley bank universe? What does it mean for the average borrower, if anything?

ROBERT REICH, FORMER U.S. LABOR SECRETARY UNDER PRESIDENT CLINTON: So far, it doesn't mean anything. The big question is one of contagion.

,That is what we saw in 2008 was when one big bank, then a couple others started to fail, could not pay what they owed and they were closed and regulators had to move in very, very quickly.

We ended up with a financial crisis because, you know, one big banking card easily starts tipping other cards. It's a house of cards. We don't know yet about contagion.

What we do know is this bank was overextended. And this is related to the Fed. As interest rates went up and this bank was lending to a lot of start-ups, this bank could not handle it.

I think this is the biggest economic news today. It's not this jobs report. The jobs report was good. And it signals to me a soft landing.

But I think, in terms of what the Fed is going to do, this bank implosion, this potential contagion, may reverse Jerome Powell's direction. It may lead instead of a half point increase, it may lead to no increase.

It's conceivable that interest rates stop dropping out of a fear that we'll be in deep trouble.

BLACKWELL: You have advocated for the Fed to stop increasing the interest rate before this issue with Silicon Valley bank. Why? Before this issue with the Silicon Valley Bank. REICH: I don't see any wage-price inflation. Wages, according to Jerome Powell, are pushing up prices. Well, that's simply not the case.

[14:40:00]

Look at today's report. We're seeing the smallest wage increase in over a year. Prices continue to rise. That is absolutely true. Wages are not pushing them up. It's not that workers are doing so wonderfully well.

What's pushing up many prices domestically is big companies that want to increase profit margins. They have monopolies or near monopolies and they're using the opportunity, using inflation as an excuse to put up their prices.

At its bottom, it's an anti-trust monopolization issue. It's not a Fed interest rate problem.

BLACKWELL: You suggested the Fed should stop increasing the interest rate.

If that's the only tool they have - I imagine you'll correct that assumption. But if that's the only tool they have to try to bring it back down to the 2 percent rate, that goal, then what else can they do to try to tame inflation, if not increase the interest rate?

REICH: Well, first of all, let me say it's not clear they have to do anything else. Inflation is starting to come down. We'll find out more Tuesday when the inflation report, the consumer price increase report, inflation report, will be coming out.

As of what we know now, inflation is slowing slightly. The key here is the direction. If inflation were increasing, that would be one thing.

If inflation is starting to slow down and we're seeing it going in the right direction, then it's not clear that the Fed has to keep raising interest rates and risking a recession that's going to hurt everybody.

BLACKWELL: All right, Secretary Robert Reich, always good to talk to you. Thank you.

REICH: Thanks.

GOLODRYGA: If you suffer from migraines, relief may be on the way. Pfizer says the FDA has approved a new nasal spray to treat symptoms. We'll tell you about it ahead.

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[14:46:17]

BLACKWELL: New guidance from the Federal Drug Administration today for breast cancer screenings. The FDA is now recommending all mammogram centers inform women if they have dense breast tissue because it poses a higher risk for break cancer. GOLODRYGA: Some doctors are pushing back and argue patients will not

fully understand the complex issues around breast density.

We're joined by Dr. Esther Choo. She's a professor of emergency medicine at Oregon Health and Science University.

Doctor, thank you so much.

I believe knowledge is wealth and women should have access to this information.

The question is, why isn't the FDA taking the extra step in saying not only should women be told if they have dense breast, but should be advised by doctors to have an additional sonogram after the mammogram?

DR. ESTHER CHOO, PROFESSOR OF EMERGENCY MEDICINE, OREGON HEALTH & SCIENCE UNIVERSITY: Thanks for having me on.

This is a complicated issue. It comes down to individual total risk and decision making.

Basically, what this dense breast tissue means is, one, they have increased risk for future issues, and also that the mammogram that detected this breast density, more fibrous tissue, made the mammogram less sensitive.

This still remains one risk factors among many. The increased risk can be between 1 percent and 4 percent.

It doesn't necessarily mean we need to jump in and add a bunch of other modalities, whether ultrasound or MRI, but it means it will prompt a conversation between the patient and their health care provider about their total risk and what to do going forward.

For some women, instead of going to, say, spaced out mammograms at a certain age, that they'll continue to have annual mammograms and continue to screen many women.

BLACKWELL: According to the Mayo Clinic, dense breast tissue is more likely in younger women. Does this change the age at which women should start to get mammograms to learn if they have a greater risk?

CHOO: I don't think so. I mean, younger women are just far less likely to have breast cancer. The risk goes up astronomically as you get older.

Women who have a strong family history of breast cancer may opt to get screening mammograms earlier.

However, in general, if you start young, you will be more likely to pick up false positives that can lead to a ton of unnecessary testing and cost and do more harm than good.

Understand that this issue of breast density has been known by radiologists for many years. It's just that information hasn't been well translated to the public, communicated directly with patients. They didn't know to incorporate it into their understanding of the breast cancer risk.

GOLODRYGA: Can the density of a woman's breast change over time throughout her lifetime?

CHOO: Yes, it can. I mean, as you just mentioned young women are more likely to have fibrous breast tissue. Your mammogram can change over time. It certainly is something that can be new information over time.

BLACKWELL: Dr. Esther Choo, thank you so much.

CHOO: Thank you.

[14:49:55]

BLACKWELL: A powerful storm in the west is dumping dangerous amounts of rain on millions of people and putting dozens of California communities under a state of emergency. We'll take you there, ahead.

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BLACKWELL: Germany is in shock. A man started shooting at a Jehovah's Witness center in Hamburg after a religious service. Officials say that shooter killed seven people, including an unborn baby.

GOLODRYGA: The mother, seven months pregnant, is currently being treated in a hospital with seven other people.

Police say when they stormed the building, the 35-year-old gunman, a German national, killed himself. Officials say the suspect was a former member of the Jehovah's Witnesses. And it is believed that he was not in good terms with the organization.

[14:55:02]

Back here in the U.S., the NTSB is to arrive at the site of another Norfolk Southern train derailment today. This time, in rural Alabama.

Emergency officials in Calhoun County said about 37 cars went off of the track sometime Thursday evening. No reports of injuries or concerns of hazardous materials being spilled.

BLACKWELL: This derailment happened hours before Norfolk Southern CEO, Alan Shaw, was questioned by the Senate, testifying about the toxic derailment last month in East Palestine, Ohio.

GOLODRYGA: And welcome news for adults who suffer from migraine headaches. The FDA approved a new nasal spray to treat migraines. Drug maker, Pfizer, says the spray may relieve pain in as quickly as 15 minutes after use.

BLACKWELL: The spray is designed to be especially effective for those who experience nausea as a migraine symptom. It's also safe for those who have heart disease.

GOLODRYGA: Well, the Manhattan attorney general's office has invited former President Trump to testify before a grand jury. It all ties back to that 2016 hush money payment to adult film actress, Stormy Daniels. What this signals as prosecutors weigh criminal charges.

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