Return to Transcripts main page

CNN This Morning

U.S. vs Iran, Today's Soccer Match Becomes Geopolitical Showdown; White House Treads Carefully Amid China Protests as U.S. Tries to Mend Relations; Bank of America CEO on Recession Fears, Rail Strike and China. Aired 7-7:30a ET

Aired November 29, 2022 - 07:00   ET

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

[07:00:02]

DON LEMON, CNN ANCHOR: And so I agree with that, people in their home.

But there was also with a funny moment where we did -- we actually did a shot on television.

POPPY HARLOW, CNN ANCHOR: Of what?

LEMON: Of tequila.

HARLOW: Espresso? Come on.

LEMON: Tequila. In honor of New Year's Eve on CNN. So, he said, if you can't drink on CNN on New Year's Eve, then you can drink on my show. And so we did a shot. And, of course, that was -- probably he was just giving it to our boss, which was his executive producer not so long ago.

HARLOW: There's that. I'll watch it all tonight, not with the kids.

CNN This Morning continues right now.

LEMON: Top of the hour. Good morning, everyone, so glad to have you here. We're glad to be in your homes this early in the morning.

We have a lot of news to get to, from threats of imprisonment to torture, why the families of Iranian soccer players could place consequences if the players don't fall in line ahead of today's match against the U.S.

HARLOW: Also a CNN exclusive with Bank of America CEO Brian Moynihan. He is here in studio to react what's happening with the economy, a possible rail strike coming, is there a recession coming, China, a lot ahead with him.

KAITLAN COLLINS, CNN ANCHOR: And also this morning, I sat down with Georgia Governor Brian Kemp yesterday. He is now out in the campaign trail with the Republican Senate candidate in his state, Herschel Walker, after initially keeping him at an arm's length. We'll talk about what's different this time around. LEMON: Two big CNN interviews to get to but we are going to begin with soccer and a geopolitical standoff. Talk about pressure when the U.S. and Iran play their highly anticipated match at the World Cup this afternoon, the Iranian players will be competing under extreme duress. CNN has learned that they have been warned by their government to behave or their families will be tortured and imprisoned.

Last week, the Iranian players refused to sing their national anthem before a match against England.

Jomana Karadsheh is live for our CNN This Morning in Istanbul. Hello to you, Jomana, thank you so much for joining us. What are you learning about these threats?

JOMANA KARADSHEH, CNN CORRESPONDENT: Well, Don, what we understand from a security source who's involved in the security of the World Cup and who has been monitoring the movements of security agents from the regime who are in Doha for the games, after that first match, as you mentioned, when the team didn't sing the national anthem, which was seen as a sign of support for protesters back home, quite an embarrassment really for the regime and humiliation.

And what we understand from the source is after that game, the players met with members of the feared Revolutionary Guard Corps, who threatened them and intimidated them, telling them that they have to, quote, behave, sing the national anthem, not take part in any sort of political moves against the government, any sort of protest, or their families back home will face torture and violence.

And we understand, Don, from this source that there's a large number of regime security agents in Qatar right now monitoring the team and making sure that they don't mingle with anyone outside the squad.

LEMON: Here's a question, though, because not every player, Jomana, lives in Iran -- who plays for Iran actually lives in Iran. Could the government actually do something to these players and their families out of the country?

KARADSHEH: Well, this is really a concern. I mean, this is a regime, Don, that has a history of targeting and plotting against dissidents and opposition figures outside the country. I mean, there have been plots and attempts against dissidents here in Turkey where I am and in the U.S. We know that security agencies there have plots against dissidents and opposition figures in the past.

And this is really not a threat that is only within Iran's borders, it goes way beyond that. I mean, just a few weeks ago we heard from an opposition T.V. news channel based in London saying that three of its journalists had been informed by London's metropolitan police that there was a serious, credible threat and an imminent threat against them and their families by Iranian agents in the U.K.

So, there's a lot of concern, Don, in the past week. I've gotten so many messages from Iranians around the world who are concerned about fans who are opposed to the regime who are currently in Doha, and as we heard from the source saying that there's a large number of regime security operators who are currently in the country.

LEMON: Jomana, thank you so much for your reporting. Appreciate it.

COLLINS: Also this morning, the White House is closely watching the protests that are unfolding across China because of COVID lockdowns. President Biden and his team are carefully weighing how to respond. They're reacting cautiously to the scenes like this one that have been playing out.

CNN's M.J. Lee is live at the White House. M.J., it's been really notable to me that the administration has been focused on the substance of China's COVID policy, those zero-COVID policies that Xi Jinping was trying to achieve rather on any police response to the protests that we're seeing play out.

[07:05:11]

M.J. LEE, CNN WHITE HOUSE CORRESPONDENT: Yes. I mean, Kaitlan, I can tell you that, publicly, the White House is treading very carefully around this issue, showing real sensitivity and caution as they're talking about these events and these events that are now taking place not only just in China but have spread even to the United States with protests on certain college campuses, for example, here.

Now, to things that the White House made clear is that, one, it generally supports any people's right to peacefully protest and, two, that it doesn't see Beijing's COVID policy a sound policy. But as we saw at the White House briefing room yesterday, beyond that, they are being very careful not to go too far.

I asked a senior official yesterday, what role the U.S. might play as people in China are asking for and crying out for more freedom. And they said, look, for the time being, it's best to leave things that we are monitoring things very carefully.

I think all of that just goes to capture how much sensitivity there is around this issue. As you know, U.S. and Chinese relations have really reach add low point reached a low point and there are efforts to try to mend those relations.

COLLINS: Yes. And Biden just met with the president of China not that long ago.

M.J., I also want to ask you about something else that's really important and it's playing out, which is the fact that we're on the verge of this rail strike potentially and Biden took the step, an aggressive step yesterday, that wasn't always expected from him saying that Congress should actually pass legislation to resolve this, saying that his top lieutenant who have been dealing with this basically don't see any path forward at the bargaining table at this time. What is the White House saying about this?

LEE: Yes. You know, the very, very last thing the president wants to see is these railroad workers going on strike. It would be an economic nightmare obviously, particularly before the holiday season. And this is precisely why we saw the president take this almost last resort step of calling on Congress to intervene, to pass a bill that would essentially force everyone to adopt this agreement.

Just keep in mind, though, earlier this year, when this agreement was reached, the president himself was very closely involved, and it was a real celebration when that agreement came to fruition. And so now, the White House is very invested in making sure that things don't fall apart at the last minute.

Now, as far as this vote, this bill on Capitol Hill, my Hill colleagues are reporting that the votes seem to be there in the Senate. But timing is really up in the air. They could end up happening sometime this week. It could also get pushed back until next week, too.

COLLINS: Yes, we're waiting to see what the Senate does. M.J. Lee, thank you.

LEMON: So, let's dig a little deeper on the economic impact of a potential rail strike. If the two sides cannot reach agreement soon, industry officials have estimated that a strike could cost the economy more than $2 billion per day. Freight rail makes up a huge chunk of the American supply chain.

A strike means food prices could skyrocket because rail is absolutely crucial in getting those products to consumers. Even gas prices could increase, given 300,000 barrels are moved daily by rail. And about 75 percent of all cars and trucks built in the U.S. are imported, or imported, I should say, here are moved by rail. That could mean a big shortage and massive price hikes.

And if you're a commuter, you may be in trouble, too, as nearly 97 percent of rail, passenger rail used by Amtrak usually runs on freight lines. And on top of all of that, the holidays are right around the corner, meaning this strike could come during peak buying season.

HARLOW: All right. Now to a CNN exclusive, we're just talking about Congress preparing to act to avert this rail shutdown. President Biden warning if that happened, it would devastate the economy if we had a strike like that.

So, joining me now to talk about this and a lot more is Bank of America's Brian Moynihan, chairman and CEO, one of the biggest banks in the world. You know where the economy is headed. We'll get into all of that. We really appreciate you coming in to CNN This Morning.

BRIAN MOYNIHAN, CEO, BANK OF AMERICA: First of all, congratulations on the new show, to you and your colleagues.

HARLOW: Thank you.

MOYNIHAN: So, look, things like the rail strike or the war in Ukraine and, you know, what happens in China with shutdowns, those are all sort of things that can really derail the economy and everybody knows that. We've been dealing with it for quite a period of time. But if you look at the core economy, our team has a mild recession predicted middle of 2023 and then coming back out of it later in 2023. Now, that was predicted to happen this year earlier this year. There was going to be a real slowdown, the Fed was going to raise rates and it's all pushed out largely because of one thing, which is U.S. consumer, who is spending money. And we just got our spending from Thanksgiving to last Saturday and it was up 3 percent over last year, which is up 23 percent over the year before, 20 percent over where it was in '19. You see booking travel and things like that, you see the consumers employed. You see them spending money. You see them having money in their accounts. Now, that means inflation has to be tackled by the Fed, but the consumer actually is both a buffer against that and also makes it difficult.

[07:10:05]

HARLOW: What I think is so interesting about you, Brian, is you've been like the optimist in all of this. So, you just said, yes, a mild recession next year, but we'll get through it by the following year. Jamie Dimon warned this summer, head of JPMorgan, that an economic hurricane, his words, are coming. We just don't know how strong a hurricane. Do you see an economic hurricane?

MOYNIHAN: Well, hurricane season is now closed. So, if having a house in Carolinas, I'm used to dealing with that.

But in the end of the day, the belief was if any of those horribles came together, you can have really a different outcome than the Fed tightening. And the Fed is tightening in an unprecedented way because we have an unprecedented inflation, 40, 50-year long inflation.

So, where does that effect first? Housing. Obviously, that's changed dramatically. But rent increases are only coming through now. So, in the end of the day, the consumers held in well, and in the end of the day, the consumer stays reasonably strong because they're employed.

HARLOW: So, I'm hearing no economic hurricane from Brian Moynihan? Am I right?

MOYNIHAN: A mild recession.

HARLOW: A mild recession. Okay. So, let's tick through all of those things. Housing matters to everyone. It is much more expensive to buy a house now because of mortgage rates and your own research at Bank of America show how much rents have increased. So, people feel like they're out of hope. When is it going to get better for housing for Americans?

MOYNIHAN: So, this is the toughest thing, because you have to slow down the economy, you have to slow down inflation. And the way you do that is raising interest rates.

HARLOW: The Fed wants us to buy fewer homes?

MOYNIHAN: That's exactly right. And so what is the intended outcome of their policies doesn't feel good when you're trying to buy a home, if your young family trying to buy your first home, whatever. So, that will straighten out. And we have to sort housing into two pieces. One is the people who have mortgages that are outstanding locked in below 5 percent, 4 percent, 3 percent, 90 percent below 5, 80 percent below 4 percent, 50 percent below 3. They're locked in 30 years.

HARLOW: Yes. But other folks?

MOYNIHAN: But when you go to buy a house, you're feeling that effect. And that slowed down dramatically and that's why home builders and others -- but that's the intended outcome. What will happen is, as we see inflation slow down and you're seeing the rate of growth of inflation slow down, you see rates come back down to more the target rate and you'll see that adjustments come through. And that will happen. That will take almost two years.

HARLOW: Two years of pain for people trying to rent or buy a house?

MOYNIHAN: Two years of slower activity.

Now, the rental side of that is the key. And rents have increased and you're seeing rents have increased and already starting to decrease in some towns, cities around the country. But that's where you have to be more concerned because half the people in America pay rent. They don't own their home. And that's still ahead of us.

HARLOW: And millions have a lot of outstanding credit card debt. And can you just help us understand why credit card interest rates are at a record high now? Now, I understand the Fed is raising rates, but the Fed funds target rate compared to APR seems extreme. And I know there's not collateral to back credit cards, but like do they really need to be that high?

MOYNIHAN: Well, reality is a third of our credit cards pay off every month. They don't pay interest, right? So, we give you the money for 30 days later or 45 days later, you pay us.

HARLOW: That means two-thirds of Americans don't.

MOYNIHAN: And then the ones that do, the rate structure is far lower than the state of rate structure just because of all the different things that are going on.

So, look, those rates adjust with the market. They'll come back down with the market. They were low for a long time. But the reality, as I said, the good news is for America is delinquencies on credit cards are low. They are much lower than they were in '19, which is very good credit times for banking systems. So, our job is to actually help our customers continue to prosper and live.

And the key things, remember, unemployment is 3.6, mid-3s. The worst projections get to 5s, where it was in the 17, 18 range.

HARLOW: You met with President Biden, I think it was in July, at the White House. I wonder how you -- presidents get a lot of credit when the economy does well and all the blame when it does poorly. How do you think he's handling this economy? MOYNIHAN: Well, in the end of the day, he's dealing with a very unprecedented time. So, the job of the American people is to decide that, and they just had elections.

HARLOW: What does Brian Moynihan think?

MOYNIHAN: I think our economy is holding on better than the rest of the world today.

HARLOW: Okay.

MOYNIHAN: Now, the reality is, did we give more stimulus than you could theoretically calculate? But nobody knew at the time.

HARLOW: Too much stimulus? Lesson learned?

MOYNIHAN: Yes. That was to the last administration, this administration, but nobody knew at the time. And I think that's where people can look through the rearview mirror and always have a great point of view that sports writers can. But players on the field had to make a decision. Was it right or not? And they did. Now we have to adjust to that decision. That's why you're seeing the Fed tighten quick.

HARLOW: I want to talk about what's going on with workers. You employ so many people at Bank of America. You have also taken -- you have led on wages, increasing wages now to $22 an hour at bottom. You're going to be $25 an hour by 2025. But real wages are down for folks because of inflation.

And something is going on with workers. I was home in Minnesota this weekend. Coffee shops were closed. They couldn't find workers. Restaurants can't find enough workers. We're seeing unionizations at companies that never saw it before, Starbucks, Amazon, news outlets, like BuzzFeed. What is happening with the American worker?

MOYNIHAN: Well, the labor market has gotten very tight. So, the dynamics shifted that with the kind of employment levels we had, claims for unemployment still are bumping along at very lower levels, levels that haven't been seen since the numbers of workers are like 25 percent lower.

[07:15:07]

So, you know, the labor market is very tight and so the negotiation power moves around, right? I mean, that's what happens. The quick rates got way high.

What you're seeing now is mitigate, which is actually good from the Fed perspective in terms of the economy, but you're seeing that mitigate.

Now, how do we think about that? Our job is to provide an ability for an 18-year-old join our company and be here their entire career and get themselves educated and trained with us, and you do that all day. I just celebrated a 50, 55, 65 and a 75-year-old employee. So, think of 75, do some math and think that the person started as 18 and went to college. That's what great employers do that.

And so our turnover rate moved up like everybody else's already moved back down. My guess is by early next, we're back in line where it was in '19, which is good, but that takes employers really saying, how do I holistically help a person develop a career?

HARLOW: Yes. Like you guys gave money, a lot of it, to employees to pay for child care during the pandemic, when you asked them to come back.

I want to talk about China. You do a fair amount of business in China. How worried are you about what we're seeing on the streets of China and Xi Jinping's tight grasp on power and zero-COVID policy?

MOYNIHAN: I think the thing we have to think about China is they're still dealing with COVID the way we were dealing with it in 2020, in the spring, which is your choice is to shut down. And that is very disruptive as a supply chain, the internal economy, we've dropped our projections in the company down to 3 percent GDP growth. Our economy generally always grew 5 to 6. So, it's affecting their economy and it's affecting the worldwide economy.

The shortages -- Don talked about the railroads and not having shortages. If we don't have the goods, we can't ship them. And that supply chain is still not evened out. And that is somewhat good news and that stuff still has bought and has to get through the system but it's bad news because it will slow people's purchasing down because they don't think they can get something. And that's kind of the issue in China.

So, leave aside the health care struggle and the human struggle, which is horrible, but the reality is, from an economic perspective, their shutting down is causing the world disruption and they really don't have a choice, it seems, because they don't have the structure as in the United States with vaccines and people through the system.

HARLOW: And so you're concerned about it?

MOYNIHAN: We're always concerned about it.

HARLOW: Okay. Twitter. Bank of America is one of the big banks that financed Elon Musk's takeover of Twitter. Elon Musk himself tweeted a few weeks ago Twitter could go bankrupt, hanging on to a lot of that debt. Financial Times is reporting you guys, the big banks were waiting for a business plan from Musk, here is what it's going to look like to unload that debt. Have you gotten a business plan? What do you make of how he's leading?

MOYNIHAN: Well, that's not something that we talk about with clients, customers. And, by the way, I'm the worst person to be in the middle of a credit decision because that's not what I do in the company.

But if you look at it just on leverage finance, which is people talk about at the end of the day, we market-to-market every Friday. So, it's all through the PNL and whatever impacts. And, look, he'll run the company the way he does. He owns it. They have tremendous equity in it. And so we'll see what happens.

HARLOW: Hoping for the best?

MOYNIHAN: We don't hope. We plan for the best.

HARLOW: Okay. I do want to ask you about crypto. You have been very cautious always on cryptocurrency. Look what has happened. Look at FTX collapsing. Look at this week, BlockFi, which is crypto lender, that I think it's important people know, lends to -- it was for average folks. This was for the main street average Joe collapsing. What went wrong with crypto?

MOYNIHAN: What went wrong is I think it was a speck of asset got very high and then came crashing down and leverage embedded, all that happened, but that was relatively predictable and many of us said, be cautious here.

The good news is, if you think about the history of it, the rate of movement out of our accounts into crypto slowed way down, which means investors have gotten more cautious.

HARLOW: A lot of people got fleeced, and you guys are so highly regulated.

MOYNIHAN: Yes.

HARLOW: I mean, watch any of those, and your testimony before Congress. And like where are the regulators on this? Is it safe for anyone to have a crypto market that exists anymore without regulation?

MOYNIHAN: Well, if you -- you would have to back up two things. Blockchain, the technology very good. We have hundreds of patents on it literally. The idea of a currency and stuff, it's not needed. We can transact in ways that are wonderfully fast, a real-time payment system that are connecting around the world. The Fed is building one. We've already built one in the industry, the ability to send money anywhere in the banking system. These things are important.

So, are there areas where that industry has to lead and that other entrepreneurs saw an opportunity? Yes, the small balance, the cross- border payment and we're working on stuff to make that easier.

HARLOW: We've got to let you go in one second. Final question, Politico headline about you a few months ago, the bank CEO preaching sustainability. You are all about green, green, green, yet you guys keep -- you do invest in fossil fuels and oil, you see it as a balance. What's working on climate change, what's not and should corporations do more at this point than government because government seems not to be able to break through?

MOYNIHAN: Corporations around the world, commitments they've made to make a just transition happen are stunning.

[07:20:03]

You just saw one the other day where I think it was Microsoft agreed and others agreed to buy renewable power in Ireland. It was like 30 percent of the power.

HARLOW: Yes.

MOYNIHAN: So, I mean, these are stunning commitments by people who see the need to make a transition. But we've got to give them time and we as a company have to help finance that transition.

And so we believe that we need oil and gas companies to make that transition and help lead that. We believe that we need renewables companies to make it. But, really -- and these -- all the operating companies of the world to figure how they're going to change how they buy power, what they use in their production capability. And our job is to educate people and do it.

And that is amazing thing you see as a private sector is driving this. We did $200 billion of financing in 2021. We talk about $100 billion in Paris per year. Our company and many other companies did it likewise. So, that's what we're driving.

HARLOW: So, companies more than government is driving it.

Brian Moynihan, come back. We really appreciate you being here on CNN This Morning. Thank you.

MOYNIHAN: It's great to be here. Congratulations again.

HARLOW: Thank you. Guys, back to you.

COLLINS: Fascinating interview there, Poppy.

Up next, we're going to talk about a big health headline this morning. If you're having trouble remembering things, scientists say that you can slow your cognitive decline by eating more of this food. We'll explain.

LEMON: I need to go to the farm stand right after this.

And our Kaitlan Collins sits down with Georgia Governor Brian Kemp and asks why he is now campaigning with Herschel Walker after trying to avoid him.

(COMMERCIAL BREAK)

[07:25:00]

COLLINS: Welcome back to CNN This Morning. It is half past 7:00. This is what's coming up. There's a reason why people tell you to eat your fruits and vegetables. We'll tell you what a new study found.

Also today, Senate lawmakers are set to vote on landmark legislation to protect same-sex marriage. What to expect on that front ahead. We'll tell you from Capitol Hill. Also this morning, Georgia Governor Brian Kemp sounding off on everything, from his high-stakes Senate runoff that's happening next Tuesday to President Trump dining with an anti-Semite. We'll give you my in-depth interview coming up. LEMON: So, how many times have you heard this from mom, from everybody, right? Eat your vegetables. No, really. Eat your vegetables. There's a new study and it finds that eating more vegetables and fruits can slow down the rate of memory decline.

So, joining us now, Dr. Tara Narula is here to explain the benefits. What was I talking about? I can't remember.

HARLOW: Eat your broccoli.

DR. TARA NARULA, CNN MEDICAL CORRESPONDENT: Yes, I was just going to say, mom was right.

LEMON: It's true, my memory's terrible. I think we only have so much capacity.

NARULA: Yes. Well, your mom was right. Food is medicine, and we really don't talk about nutrition and the power of nutrition in terms of our health enough.

LEMON: What foods?

NARULA: And so this particular study looked at flavonols, which are a class of flavonoids.

HARLOW: Say that three times.

NARULA: Flavonol, flavonol, flavonol. These are phytochemicals found in plant pigments. And plants have over 5,000 types flavonoids. And so what we know is that from animal studies and human studies there has been research that has shown that flavonoids can actually protect against possibly cancer, cardiovascular disease, inflammatory disease, and now in this study, they looked at cognition, so brain function.

And so researchers looked at about 961 adults who are average age 80. They followed them seven years. And at the end of each year gave a diet or food questionnaire to fill out and they did a cognitive test. And they found that those individuals that ate the most flavonoids, which was about 15 milligrams a day, one cup essentially of dark, leafy green vegetables versus 5 milligrams a day had a 32 percent slower rate of cognitive decline. So, that's exciting and interesting and definitely it's one more research study to kind of prove the power of vegetables and fruits.

COLLINS: Okay. But I have to ask what is a flavonoid?

NARULA: Yes. So, where do we find those? So, they also looked at different types of flavonols, subclasses, and, basically there is something for everybody. So, you can find them in spinach, kale, broccoli but also onions, berries, Don, so strawberries, blueberries, wine and tea.

LEMON: Wait, say that again.

NARULA: Wine.

LEMON: Say that again.

NARULA: And then even some herbs, like chives, dill, tarragon. So, really, you can find them in a lot of things that are fruits, vegetables, seeds, roots, that class.

LEMON: My favorite fruit is --

COLLINS: Wine?

NARULA: Pomegranate.

HARLOW: I think Kaitlan is correct.

LEMON: Is tequila a fruit? No. Pomegranates, I can eat a pomegranate or more every single day.

HARLOW: how does one eat a pot, like eat it?

LEMON: Very carefully.

HARLOW: Seeds?

LEMON: Yes, I eat very carefully because I eat the seeds. I love it and I love pomegranate. So, I love everything about pomegranates.

NARULA: So, it is important. We always want to caveat these studies and say that they're not cause and effect, right? This is an observational study. It was also based on self-report. So, that may not be the most accurate. It was a population in the Midwest, mostly women, mostly educated, mostly white. So, I don't know if we can translate this to everybody.

And then the important thing is sometimes those who eat plant-based diets or flavonoids actually have other healthy behaviors. So, is it the other healthy behaviors that's helping prevent cognitive decline? And, finally, it is the whole plant. So, it's difficult sometimes to tease out, is it really the flavonoids, flavonols or is it just the plant?

COLLINS: My new favorite word of the day, flavonoids.

HARLOW: Dream of flavonoids tonight.

LEMON: Wine, wine.

HARLOW: You're supposed to read the --

LEMON: Thank you very much. I can't remember it because didn't eat my vegetables this morning.

Today, the Senate will vote on a bill to protect same-sex marriage nationwide. When can this become law?

COLLINS: Yes, that's huge.

Also, Georgia setting out a single early voting record in a Senate runoff, that's election, of course, between the Democrat, Raphael Warnock, the incumbent, and Republican Herschel Walker. Up next, we're going to let you see my interview with the Georgia governor, Brian Kemp, who is playing a pivotal role in this election.

(BEGIN VIDEO CLIP)

COLLINS: It reminds me of something we saw on the campaign trail recently, which was, you said, who do you want to fight for you in a Senate?

[07:30:00]

Do you want a guy who represents our values, like Herschel Walker, or do you want somebody who has voted with President Biden 96 percent of the time? Does Herschel Walker share your values?