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Trump In Iowa Ahead Of A Political Indictment; Major Nor'easter Storm Threatens New York And New England; Biden Assures Americans Banking System Is Safe. Aired 2-3a ET

Aired March 14, 2023 - 02:00   ET

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

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[02:00:32]

ROSEMARY CHURCH, CNN INTERNATIONAL ANCHOR: Hello and welcome to our viewers joining us here in the United States and all around the world. I'm Rosemary Church. Just ahead on CNN NEWSROOM. Winter storms bearing down on both coasts in the U.S. One system could leave a foot or more of snow in parts of the Northeast, while another atmospheric river is set to dump rain on already flooded parts of California.

Plus, after the biggest U.S. bank failure since 2008. Regional Banks fear a broader financial crisis as their stocks tumble. And former President Trump in Iowa taking swings at GOP rivals just days away from a potential criminal indictment.

ANNOUNCER: Live from CNN Center. This is CNN NEWSROOM with Rosemary Church.

CHURCH: Good to have you with us. Well, from coast to coast, major storm systems are set to pummel California and the U.S. northeast. Out west the Golden State was already dealing with major flooding. Some 30 million people across California are under floodwaters. And on the other side of the country, a major nor'easter is expected to cover New England and parts of New York in snow.

Millions of people in cities like Boston, Syracuse and Portland, Maine were under winter alerts ahead of the storm. And days ago, U.S. President Joe Biden declared a state of emergency in more than 30 California counties. That includes Monterey County on the Central Coast. Some 5000 residents there were under evacuation alerts on Monday, and that number could rise. Officials were also working to repair a levee breach that caused even more flooding in the area.

Meanwhile, officials are warning that rising waters from the Salinas River could cut off the Monterey Peninsula from the rest of the state.

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TYLLER WILLIAMSON, MONEY, CALIFORNIA MAYOR: And then we also have the Salinas River, which is the longest river in Monterey County about 175 miles long. And that river is looking at breaching one of the major highways that folks use to get to the peninsula. And so, we're just concerned regards to the Highway 68 and potential for Highway 1 to lock in the Monterey Peninsula here.

(END VIDEO CLIP)

CHURCH: Meanwhile, officials in the northeastern United States are expecting as much as two to three inches of snow per hour in some parts of the region. The governors of New York and New Jersey have declared a state of emergency and several counties. And officials are urging drivers to stay off the roads during the storm.

Our meteorologist Britley Ritz has the latest forecast. So, Britley, weather problems for the U.S. from coast to coast. What are you seeing?

BRITLEY RITZ, CNN METEOROLOGIST: Absolutely. We've got a lot to talk about, Rosemary. We've noticed that rain is starting to pick up across the California coastline with this next A.R. It's like to moderate right now but expect it to pick up through the latter part of the morning and into the afternoon with an additional one to two inches wide spread. On top of what we've already picked up through Wednesday isolated higher amounts up to four inches possible.

And then of course feet of snow expected through much of the Sierra. Monday overnight, a moderate risk for the northern coastline of California. But that picks up through the day on Tuesday. The southern foothills of the Sierra Nevada highlighted in fuchsia down through the southern coastline and that includes San Luis, Obispo where we could pick up more rain, 5000 feet below on top of the melting snow which is going to cause catastrophic flooding.

There's Tuesday local time 6:00, bringing in the heaviest rain at that point to the coast and it rides inland by the afternoon on Tuesday and for Southern California at that point as well and it just continues to train over the same areas and finally tapering back into Wednesday. That first A.R. that we dealt with earlier on brought in quite a bit of moisture to the now nor'easter. That's pumping in quite a bit of snow through the Berkshares this morning.

Heavy, heavy snowfall already coming down and that's going to be continuing throughout the day on Tuesday. And finally starting to taper back on Wednesday but still holding onto scattered snow showers through Wednesday. Some of these areas picking up three to four -- rather two to three feet of snowfall. And that's the Catskills, the Adirondacks, the Berkshires and visibility is going to drop with this as well as we bring in wind gusts of 40 to 60 miles per hour on that heavy wet snow.

[02:05:10]

These are areas that could be dealing with widespread power outages. So we have to keep that in mind too, Rosemary.

CHURCH: Well, such extremes. Britley Ritz, many thanks for joining us with that. Appreciate it. Well, Monday was a volatile day on Wall Street as shares of dozens of regional banks plunged to record lows following the sudden collapse of Silicon Valley Bank and Signature Bank. CNN Phil Mattingly has more on President Joe Biden's promise to do, "whatever is needed to protect the U.S. banking system."

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JOE BIDEN, PRESIDENT OF THE UNITED STATES: The bottom line is this. Americans can rest assured that our banking system is safe.

PHIL MATTINGLY, CNN CHIEF WHITE HOUSE CORRESPONDENT: President Biden's seeking to reassure a nation on edge.

BIDEN: During the Obama-Biden administration, we put in place tough requirements on banks, like Silicon Valley Bank and Signature Bank.

MATTINGLY: He also placed blame on his predecessor for contributing to this moment.

BIDEN: Unfortunately, last administration rollback some of these requirements.

MATTINGLY: Biden pointing to a 2018 law that ease some of the strictest post financial crisis restrictions on mid-sized lenders like Silicon Valley Bank.

BIDEN: I'm going to ask Congress and the banking regulators to strengthen the rules for banks to make it less likely this kind of bank failure would happen again.

MATTINGLY: Biden's new regulatory push framing a new crisis moment.

BIDEN: Treasury Secretary Yellen and a team of banking regulators have taken action.

MATTINGLY: Just hours after the administration's top finance officials triggered a dramatic show of dual pronged government force. The action designed to halt financial contagion that threatened to rip through the banking system after the failure of Silicon Valley Bank. The bank's failure on Friday risking a cascade of events that threaten financial stability with a second bank failure Sunday and several more institutions on the brink, official said.

BIDEN: When we learn to the problems of the bank and the impact that could have on jobs from small businesses and the banking system overall, I instructed my team to act quickly to protect these interests.

MATTINGLY: Ninety-three percent of Silicon Valley Bank's deposits set above the $250,000 deposit insurance limit.

JANET YELLEN, U.S. SECRETARY OF TREASURY: I have been working all weekend with our banking regulators to design appropriate policies to address the situation.

MATTINGLY: Leaving thousands of small businesses and individuals at risk.

BIDEN: I instructed my team to act quickly to protect this interest and they have done that. MATTINGLY: But the speed of the crisis and the potential systemic effects marking a jarring turn for an industry viewed as stable and well capitalized.

BIDEN: There are important questions of how these banks got into the circumstance in the first place. We must get the full accounting of what happened and why those responsible can be held accountable.

MATTINGLY: And setting the stage for an equally unpredictable political fallout in the days ahead, as officials move quickly to try and separate their actions from the politically toxic bailouts of the 2008 financial crisis.

BIDEN: No losses -- and I -- this is an important point. No losses will be borne by the taxpayers.

Phil Mattingly, CNN, the White House.

(END VIDEOTAPE)

CHURCH: Justin Wolfers is a professor of economics and public policy of the University of Michigan. He joins me now from Ann Arbor, Michigan. Good to have you with us.

JUSTIN WOLFERS, PROFESSOR OF ECONOMICS AND PUBLIC POLICY, UNIVERSITY OF MICHIGAN: A pleasure, mate.

CHURCH: So, President Biden assured Americans early Monday that the banking system is safe. But despite his efforts to calm nerves, some regional bank stocks plummeted, because of course, panic and contagion are the enemy right now. So, what more needs to be done to instill trust in the wake of two bank failures and perhaps more to come?

WOLFERS: President Biden didn't just say that the banks are safe. He also said that all of the depositors from those two banks that went south will get all of their money back. And the implicit message he gave, therefore, was, if any other banks were to go south, everyone gets their money back. Now, the important thing to realize is that promise in itself should be enough to prevent a bank runs.

Why is that? Bank run secure when everyone tries to get their money out all at once, because he's worried that they're worried there's no money left in the vault. Biden promised there'll be money left in the vault, therefore, there'll be no more bank rounds.

CHURCH: All right. Good. As long as people trust his word, right? So, the big question now is, what will the Federal Reserve do when it comes to its strategy of lifting interest rates to bring down high inflation? Will they change that strategy, do you think?

WOLFERS: If they do, probably only a little. Just think of it this way. The Fed has two different jobs. You could even think of them as different divisions and they're in different parts of the building. One is to look after financial stability and they have a specific set of tools. They can do things like open up lines of credit that are banks that are in distress can rely on. A second division is all about trying to manage inflation and unemployment and all that macroeconomic good stuff and that's where they adjust the interest rate up and down.

[02:10:10]

Those divisions can largely operate separately, except now might not be a really good time to spook folks. So, I think the Fed is probably going to continue raising interest rates, but probably at a slightly slower speed until it's a little more confident that there'll be no broader spillover from the banking collapses.

CHURCH: Yes, interesting. I mean, that will make a lot of people very happy at this juncture, at least. So, why did Silicon Valley Bank fail? And then Signature Bank, New York and how many more banks do you think could be at risk?

WOLFERS: It's really important to understand how unusual Silicon Valley Bank is. The thing is, most banks are safe, because most of us, anyone who has less than $250,000 in the bank, we -- our deposits are insured. Because our deposits are insured, we're not likely to start a bank run, we know we're going to get paid either way. Silicon Valley Bank had a particular set of customers, mostly startups and venture capitalists in the Silicon Valley area.

Turns out those guys have gobs of money in their accounts. So much so that Silicon Valley Bank had 97 percent of its deposits being uninsured. So, the bank took some silly bets that lost money, people got nervous, and they got super nervous because their deposits weren't insured, then that's what caused the bank run.

CHURCH: Right. And of course, the Biden administration says, this is not a bailout, perhaps not broadly speaking. But it is a bailout for some of these depositors, isn't it? And if that's done for these two banks, won't it need to be done for any other banks that perhaps go under?

WOLFERS: So, there's an interminable debate about what is a bailout and what counts as a bailout. The good news is the folks that were really gambling money, that is the stockholders, the people who hold shares of Silicon Valley Bank, they get nothing back. They made a bet, they lost. Fair enough. Depositors, well, there's not enough money left in the vault, maybe. And so, the federal government has said, what we're going to do is we're going to make sure that you get paid anyway.

Money doesn't come from thin air. So, what they're doing is they're putting a levy on the broader banking system, whether you want to call that a tax or not, whether you want to say that's taxpayer's money or not. Well, that's all up for debate. But the important thing is they did this not because they care about Silicon Valley's bank's customers. They did that so that you and I and all your viewers know, if their bank would go south, your money is safe.

As a result, your viewers need to know, they don't need to be worried about the financial distress of their bank. They're going to get their money either way. And that creates a self-fulfilling prophecy. If people aren't worried. We don't get a bank run, and everything will be all right. CHURCH: All right. Let's hope that all calms nerves. Justin Wolfers, great to have you with us. Appreciate it.

WOLFERS: I'm feeling calm with you, Mate.

CHURCH: Thank you so much. And the collapse of Silicon Valley Bank and Signature Bank is affecting markets around the world. The Asia markets opened in the red. You can see there, the Nikkei down more than two percent. Similar story for Seoul's KOSPI. And let's take a look at the futures. A little encouraging there, although only just in positive territory but you can see the NASDAQ up at point-23 percent. We'll keep an eye on those futures numbers.

Well, the leaders of the U.S., U.K. and Australia gather in California to talk about China and make a big announcement about submarines. Plus, the International Criminal Court is reportedly planning to open to war crimes cases related to Russia's invasion of Ukraine. We're back in just a moment with that and more.

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CHURCH: For the first time since the invasion of Ukraine began more than a year ago, Russian officials could be facing war crimes charges. Reuters and the New York Times report the International Criminal Court is planning to open two cases and issue arrest warrants for several people. One will focus on Russia's unrelenting attacks on civilian infrastructure, including power stations and water supplies.

The ICC's chief prosecutor recently visited Ukraine to meet with President Volodymyr Zelenskyy and take a look at the damage. The second case will focus on the alleged abduction of Ukrainian children by Russia. CNN's Matthew Chance has details. And a warning, his report contains some graphic images.

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MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice over): It's horrific attacks like this one on a Ukrainian train station last year. Now reported to be prompting a first prosecution against Russia at the International Criminal Court.

Deliberately targeting civilian infrastructure, like this residential building and car park in the city of Kharkiv is a war crime under international law. Russia says, it only hits military targets. Russia also insists it does not abduct Ukrainian children by the so-called evacuees from war-torn eastern Ukraine shown at a Crimean summer camp. But Latest reports suggest the International Criminal Court is set to prosecute Russia for this too.

Ukraine says thousands of kids are being held some separated from living parents. And indoctrinated with Russian propaganda. Many have been adopted by Russian families effectively stolen Ukraine says by the state. But inside Russia the scandal is cast as a humanitarian mission. With the National Children's Rights Commissioner, a person named Maria Lvova-Belova discussing with President Putin that personal involvement.

[02:20:03]

Did you adopt a child from Mariupol yourself? Putin asked on state television. Yes, she responds. Thanks to you.

But Putin and his subordinates have far more immediate worries than any eventual prosecution. Least growing grassroots opposition, if not to the war in Ukraine itself, then at least to how it's being fought. Like these women from the Moscow region, standing up for their men sent to fight. These sons and husbands were trained to use artillery, the speaker says. But were sent to the front lines and used as storm troopers instead, like lambs to the slaughter, she complains.

It is that kind of allegation of wrongdoing against Russians in this war. Not Ukrainians, to which the Kremlin may be far more sensitive.

Matthew Chance, CNN, London.

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CHURCH: Ukrainian President Volodymyr Zelenskyy says his country's future is now being decided on the battlefield in eastern Ukraine. The city of Bakhmut is among those on the front lines where one deputy commander describes a tense situation and nonstop fighting at close quarters. Ukraine says, Russian forces are doing everything they can to advance in Bakhmut as they try to encircle the city.

Mr. Zelenskyy thanks to those who are defending their positions and fighting to save their country from Russian aggression.

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VOLODYMR ZELENSKYY, PRESIDENT OF UKRAINE (through translator): Those resources, the situation in the east is very tough and very painful. We need to destroy the enemy's military power and we will.

Bilohorivka and Marinka, Avdiivka and Bakhmut, Vuhledar and Kamianka and all other places where our future is currently being decided. Where our future, the future of all Ukrainians is being fought for.

(END VIDEO CLIP)

CHURCH: Australia, the U.K. and the U.S. have revealed the details of a plan to supply Australia with nuclear-powered submarines. The country's leaders met in San Diego to tout the long-term three-way partnership that's meant to deter Chinese aggression in the Indo- Pacific. But those new subs won't be arriving anytime soon.

So, let's turn to CNN's Kristie Lu stout who joins us live from Hong Kong. Good to see you, Kristie. So, what more are you learning about this and of course, the time it will likely take to receive these subs?

KRISTIE LU STOUT, CNN CORRESPONDENT: Yes. The delivery of the subs won't take place until early the next decade. But, you know, China has already been expressing its firm opposition to the AUKUS submarine deal which is widely seen as a bid to counter China and its military ambition in the Pacific. The leaders of the U.K., U.S. and Australia revealed plans, ambitious plans for a fleet of new advanced nuclear- powered submarines.

And this is how the deal will unfold. Beginning early next decade, Australia will receive at least three advanced submarines in the first batch. Australia will receive three American-made Virginia class attack submarines and then the following decade that would be followed by these U.K.-designed submarines that contain American technology and then Australia will be able to use that design to manufacture its own submarines which will be manufactured in the Australian city of Adelaide.

Now in the meantime, American submarines like the USS Missouri will be permitted to rotate throughout Australian ports. Earlier we heard from the Australian Prime Minister who commented on the historic nature of this AUKUS deal. Take a listen to this.

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ANTHONY ALBANESE, AUSTRALIAN PRIME MINISTER: The AUKUS agreement we confirm here in San Diego represents the biggest single investment in Australia's defense capability in all of our history.

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STOUT: Now, AUKUS officials emphasize that the submarines will not carry nuclear weapons. We are waiting the Chinese Ministry of Foreign Affairs briefing to cook up this afternoon but ahead of that, there was this comment that was made Thursday by Ministry of Foreign Affairs spokesman again expressing firm opposition from China to this deal mounting saying this, "We urge the U.S., U.K. and Australia to abandon the Cold War and zero-sum game mentality faithfully fulfill their international obligations and engage in efforts conducive to peace and stability in the region.

Rosemary, the deal is likely to further inflame tensions with China. We also learned that Australia did offer China a briefing in regards to this AUGUS submarine deal. We also learned that when U.S. President Joe Biden was asked whether he was worried about China interpreting this as an act of aggression. He said, nope, not worried. Back to you.

CHURCH: OK. Kristie Lu Stout joining us live from Hong Kong. Many things.

[02:25:03]

Well, meanwhile, the U.S. is cautiously praising the new China- brokered agreement for Saudi Arabia and Iran to resume diplomatic relations.

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NED PRICE, U.S. STATE DEPARTMENT SPOKESPERSON: If this is the end result of what was announced in recent days, that would be a very good thing.

(END VIDEO CLIP)

CHURCH: He went on to say the U.S. supports anything that would prevent conflict. And when asked if the U.S. is being sidelined, he said no country has done more to help build a more stable, integrated Middle East. Reaction from across the region is overwhelmingly positive. Although the Israeli Foreign Ministry said they had no comment.

North Korea has fired two short-range ballistic missiles into the sea off its east coast. South Korea's military strongly condemned the launches, calling them a grave provocation, threatening the region's peace and security.

The U.S. says the missiles did not pose an immediate threat to its territory or its allies.

Donald Trump is making his case for reelection to the voters of Iowa. Still ahead. The former president takes aim at Florida Governor Ron DeSantis who visited the Hawkeye State last week.

Plus, we'll visit a Texas County that delivered gushing support for Trump in the past two presidential elections. But now the well maybe running dry. We'll take through that.

[02:30:00]

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CHURCH: Donald Trump is on the campaign trail dishing out bile and blame for his expected 2024 Republican rivals. Before a stop in Iowa, Trump told reporters his Vice President Mike Pence was to blame in many ways for the U.S. Capitol insurrection. He also took aim at Florida Governor Ron DeSantis, who visited Iowa on Friday.

(BEGIN VIDEO CLIP)

DONALD TRUMP, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: Ron DeSantis, did anyone of DeSantis Desanctimonious? It's like Ron was a disciple of Paul Ryan, who is a RINO loser who currently is destroying Fox. Ron reminds me a lot of Mitt Romney.

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CHURCH: Meantime, his attorney says Trump will not testify in a New York grand jury probe of alleged hush money payments to adult film star Stormy Daniels. Prosecutors say they're nearing a decision on possible criminal charges. The former president is facing some serious hurdles in his quest to return to the White House. And it's not just Democratic voters standing in his way. CNN's Gary Tuchman explains.

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GARY TUCHMAN, CNN NATIONAL CORRESPONDENT (voiceover): The County Seat of tiny Roberts County, Texas is pronounced Miami. It would also be fair to pronounce it as America's number one county for Donald Trump.

(on camera) So, who do you think you'll vote for in the next presidential election?

UNIDENTIFIED MALE: Trump.

TUCHMAN (voiceover): In this county of about 800 people, he received 95 percent of the vote in 2016, 96 percent in 2020. Both times the highest percentage of any county in the nation. But is Trumpism on track for continued success here?

UNIDENTIFIED MALE: I think it's time to move on.

TUCHMAN (voiceover): This is our fourth visit here since Trump was elected president. And in this visit, there is a notable shift. Ron Swart and his wife Kay are retired and live on a hilltop ranch in the county. They and everyone else we interviewed for the story, say they voted for Donald Trump in 2016 and 2020.

(on camera) If the Republican Presidential Primary were today, do you know who you would vote for?

KAY SWART, ROBERTS COUNTY, TEXAS REPUBLICAN: Probably DeSantis, possibly Pence but definitely not Trump.

TUCHMAN: And your husband?

RON SWART, ROBERTS COUNTY, TEXAS REPUBLICAN: DeSantis, more than likely.

TUCHMAN (voiceover): It quickly became clear to us that many Donald Trump voters here are ready for a different Republican.

UNIDENTIFIED MALE: I mean, I'm leaning toward Nikki Haley the--

TUCHMAN: How come?

UNIDENTIFIED MALE: Because I like her views and the way she does them.

TUCHMAN: If you had a vote today, who would you pick?

WADE JACKSON, ROBERTS COUNTY, TEXAS REPUBLICAN: Probably Pence.

TUCHMAN: Wade Jackson has lived in Miami his whole life. He's in the oil and gas business also collects antique cars and does mechanic work. And he warns any potential intruder, he's not calling 911. He's a lifelong conservative Republican, who's not shy about criticizing the man he voted for twice. He's done some shady things that I'm not really fond of right now. So, I'm going to see if there's something else better than him.

TUCHMAN: What kind of shady things? JACKSON: Well, like all the documents and stuff in Mar-a-Lago and all of that. I think he's hidden too much stuff. We don't need that in our country, we need everything on the table, out in the open.

TUCHMAN (voiceover): Rick McDowell (PH) operates a hunting business. We interviewed the strong Trump supporter during one of our previous visits to Miami. But he now says that in next year's Texas primary, he's planning to vote for Ron DeSantis.

(on camera) Donald Trump likes loyal people. Why aren't you being loyal to him and support him again?

RICK MCDOWELL, ROBERTS COUNTY, TEXAS REPUBLICAN: I think his time is over. I think he's got too much baggage.

TUCHMAN: Trump certainly still has enthusiastic supporters in Roberts County.

UNIDENTIFIED FEMALE: So, I'm going to stay loyal. And I'm -- yes, I will stay with Donald.

TUCHMAN: You've no issues with the way he conducted himself during his presidency?

UNIDENTIFIED FEMALE: No.

BILLY HALL, ROBERTS COUNTY, TEXAS REPUBLICAN: I'd like them to run together and --

TUCHMAN: Trump and DeSantis?

HALL: Trump-DeSantis.

TUCHMAN: Who would you want to be the President? Who would you want to be the Vice President?

HALL: That big you -- I don't know. I think -- I think DeSantis might -- could get elected more easy, and Trump's got a lot of people in hiding.

TUCHMAN (voiceover): All in all, it does appear Donald Trump have some challenges here, new challenges.

K. SWART: I voted for him originally because I was really voting against Hillary. And then I was fighting against Biden, and then I thought he might be good for the country. But he's done a lot of disturbing things that are not good for the country. And I don't think --

TUCHMAN: Trump?

K. SWART: Yes, and I don't think he's for -- he really weren't representing us. He really weren't representing us.

TUCHMAN: What disturbing, in your mind?

K. SWART: The Capitol and his --

TUCHMAN: The insurrection?

K. SWART: Yes, and the comments he makes, you know, they're just not professional.

TUCHMAN: How do you feel, do you agree with your wife?

R. SWART: I agree, 100 percent. Yes, sir.

TUCHMAN (voiceover): The Texas Republican presidential primary is on March 5th, 2024. Gary Tuchman, CNN Miami, Texas.

(END VIDEOTAPE)

[02:35:09]'

CHURCH: Still to come, a zebra attacked his owner in Ohio. We will tell you what happened when authorities rushed to the scene. That's next.

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CHURCH: Malawi has declared a state of disaster in the aftermath of Cyclone Freddy. The storm slammed Southern Africa over the weekend, killing at least 99 people in Malawi alone. There are fears the death toll will rise with ongoing heavy rain and reports of landslides and flash flooding. In neighboring Mozambique, authorities say at least 10 people are dead after more than a year's worth of rain in just four weeks. And this comes as emergency crews were dealing with the aftermath of the first time Freddy made landfall at Mozambique late last month.

[02:40:09]

A man in Ohio is recovering from his injuries in hospital after being attacked by a zebra. Officials were dispatched to a home Sunday, after reports a zebra had bitten his owner's arm. Here's what happened when they arrived.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Is there a way for him -- for you to keep him back? We're trying not to shoot him but --

(END VIDEO CLIP)

CHURCH: The male zebra was apparently protecting some female zebras in the field. Authorities shot and killed the animal when it started to behave aggressively. I'm Rosemary Church. For our international viewers, "WORLD SPORT" is next. And for those of you here in North America, I'll be back with more CNN NEWSROOM in just a moment. Do stay with us.

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(WORLD SPORT)

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