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CNN This Morning
Soon, China's Xi, Russia's Putin to Meet in Moscow; Trump Says He Expects to be Arrested Tomorrow in Hush Money Case; UBS Buys Credit Suisse in Bid to Halt Banking Crisis. Aired 7-7:30a ET
Aired March 20, 2023 - 07:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
UNIDENTIFIED MALE: China has not condemned Putin's invasion of Ukraine. They are still buying Russian oil and energy resources. So, we'll watch what comes out of this meeting.
UNIDENTIFIED MALE: Russian President Vladimir Putin made a surprise visit to the shattered Ukrainian city of Mariupol.
UNIDENTIFIED MALE: He knows he has to somehow get the morale of what troops are remaining up in any way he can.
UNIDENTIFIED FEMALE: The former president says he expects to be arrested as soon as tomorrow in the Stormy Daniels hush money case here in Manhattan.
REP. KEVIN MCCARTHY (R-CA): I don't think people should protest this stuff. We also have a select committee on the weaponization of government. This applies directly to them. I think you'll see actions from them.
UNIDENTIFIED FEMALE: Robert Costello, a former attorney for Donald Trump's one-time fixer, Michael Cohen, is set to appear before the Manhattan grand jury.
UNIDENTIFIED FEMALE: I think he has inside knowledge, and we should be paying attention.
UNIDENTIFIED FEMALE: The city of Miami Beach is now imposing a spring break curfew after a second deadly shooting.
UNIDENTIFIED FEMALE: There are a lot of policemen, so way more security guards.
UNIDENTIFIED MALE: They need to shut it all off and take the party off the streets.
UNIDENTIFIED FEMALE: The Federal Council is convinced that UBS takeover of Credit Suisse has laid the foundations for greater stability. UNIDENTIFIED FEMALE: We have more of a crisis with the sort of second and third tier banks.
SEN. ELIZABETH WARREN (D-MA): This whole tranche of banks has been underregulated for five years now, and people are very concerned about when you lift the hood, what's under the hood.
UNIDENTIFIED MALE: Arkansas pulls off the upset, down goes Kansas. No repeat chance this year.
UNIDENTIFIED MALE: I've put in a lot of work.
KAITLAN COLLINS, CNN ANCHOR: Good morning, everyone, and thank you for joining us on this Monday morning. We're going to get to the latest that happened in March Madness over the weekend, but we're going to start this morning in Moscow.
Just moments ago, the Chinese president, Xi Jinping, arrived in the Russian capital for his three-day high-stakes state visit with President Putin. Later this morning, he's going to meet directly with the Russian leader one-on-one. Beijing is calling this trip quote a journey of peace, where Xi is supposed to help mediate peace talks over Ukraine, but western leaders are understandably very skeptical and wary of the two autocratic leaders growing cooperation.
CNN's Matthew chance is live in Moscow. Matthew, obviously, this meeting is going to be happening in just a few hours but it's incredibly symbolic for the fact that it's Xi's first time in Russia since they invaded Ukraine and the questions about this partnership and what it looks like coming out of this meeting.
MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes. It's a three-day visit. It's not just symbolic because it's the first time since Russia's invasion of Ukraine, but it's just a few days after Vladimir Putin was indicted by the International Criminal Court for war crimes in Ukraine as well. And so we're going to have a situation where Xi Jinping, the ruler of China, is going to be standing side by side and having face to face negotiations with an indicted war criminal.
And so that's something that will send a very strong message, I think, both to Russia, that China stands by its friend and ally, but also to the rest of the world as well, that even though China has said it wants to play an impartial role in brokering a diplomatic solution to the crisis, as Russians call it, inside Ukraine, the fact is that, you know, it is very much showing a strong level of support for the Russian leadership.
What I think many people will be watching for, though, is that what -- how far will that relationship extend. That strong political support, yes, diplomatic support, yes, but, will the Chinese provide much needed military aid to the Russians? So far, they haven't crossed that line but there is concern if they choose to do so, Kaitlan. COLLINS: Yes. And, obviously, the U.S. is watching this closely. I have been talking to officials all morning who are saying they're looking to see if there's any tangible agreements coming out of this.
I think one thing they have also been warning about, Matthew, and I'm wondering what you're hearing on this, is whether or not you're going to see China call for some kind of a ceasefire in Ukraine, which obviously they believe would benefit Russia here.
CHANCE: Well, I mean, they have only called for a ceasefire. Last month, China issued a 12-month peace proposal to bring to an end the conflict in Ukraine, in which a ceasefire was part of that, and so too was the condemnation of violation of territorial integrity of U.N. states. It also condemned unilateral sanctions against individuals as well, obviously, an inherent criticism of the sanctions against Russia by the United States and others in the international community.
But what it didn't specifically do is condemn the Russian invasion of Ukraine and call for Russia to withdraw, which is one of the reasons why that peace initiative has been getting such a lukewarm response by the United States and others in the west as well.
But it is something the Kremlin says that the two leaders are going to be discussing in more detail over the course of the next three days.
COLLINS: Yes. We'll look to see what they say. Matthew Chance in Moscow, thank you.
POPPY HARLOW, CNN ANCHOR: So, let's bring in CNN Political and National Security Analyst and New York Times Correspondent David Sanger. David, thanks for coming back. We fixed the tech. We're glad you're back.
Talk to us about what you expect from these three days given the fact that China -- that Xi Jinping just said moments ago, reiterated its willingness to work with Vladimir Putin to, quote, safeguarded international order. This is after Putin just before invading Ukraine talked about their relationship, these two leaders, as a no limits partnership.
DAVID SANGER, CNN POLITICAL AND NATIONAL SECURITY ANALYST: That's right. I worry about two different things here. The first Ivan raised before, which is do we see arms and basically do we see the Chinese getting further into this war. I think the second thing to look for is whether or not in some kind of peace proposal for an armistice or a ceasefire, essentially, the Chinese come in on the side of the Russians to try to cement the gains that they have right now.
And that's why you're hearing from the Americans and from President Zelenskyy and Ukrainians great concern that China would seek in some way to reward Russia and basically freeze this the way the Korean conflict has been frozen now for 50 or 60 years.
HARLOW: This seems to be what they're really worried about, the U.S., in terms of trying to preempt John Kirby, who's going to come in the program later today, has been saying it would not be acceptable. So, China is trying to play this peacemaker but it would not be acceptable for China to come out and say, okay, let's push towards peace right now in this moment, because in this moment, Russia has taken more Ukrainian territory than obviously before the invasion.
SANGER: That's right. And that's a significant worry. On the other hand, the trends have to be a little bit cautious here, and they have to be cautious because they're worried about Europe. They would like to make sure that Europe does not join in any sanctions against China, that Europe and the United States do not tighten this bond that has been created since the war began, and, you know, Europe is a major trading partner for them and is continuing to take a good deal of their technology.
So, I think they're not going to want to get in too deep. And that's one reason I think that they have probably been cautious so far in providing weapons to the Russians. The problem is the Russians don't have other places to turn right now. Their only other sources are Iran and North Korea, and, obviously, the quality of that is not up to what China can give.
COLLINS: Also, David, what it says about China on the world stage, because this comes after China just brokered that diplomatic deal with Iran and Saudi Arabia. Now, we're seeing them try to assert themselves in this way saying that, you know, they are this powerful influence when it comes to international order.
SANGER: They would love nothing more, Kaitlan, than to play the role that the United States played during much of the cold war and post- cold war period, which is the central player that everybody had to come to so that they could organize the world on the basis of the rules that they consider advantageous. And they think the United States did this from the end of World War II in 1945 through to just a few years ago. And that's why it was so important to them to play this role between Iran and Saudi Arabia and would be important to them to do this now.
And, of course, the United States not only doesn't want to give up its position on that, but it also is suspicious that China is not the neutral player that it pretends to be. Of course, that's what the Chinese say about the United States.
DON LEMON, CNN ANCHOR: All of it had very interesting optics for Vladimir Putin, especially after just visiting Mariupol, going to the war zone, David. What do you make of that?
SANGER: It is. I mean, he was doing two or three things there, Don. The first is he wanted to say, this is my territory now. You know, this is an area that obviously they not only bombed and destroyed, but it's an area where they kidnapped many of those children for whom he was indicted by the International Criminal Court. Because the second thing he was saying is the indictment means nothing to me. In fact, they'll continue with all of their activities in Mariupol that they have done until now. So, it was a real act of defiance, and clearly getting the endorsement of having Xi Jinping show up for their 39th meeting since the two of them took over as leaders. That's pretty significant.
LEMON: All right. David Sanger, always a pleasure. Good to see you, thank you so much.
So, in other news now, it could be an eventful week here in Manhattan with a possible indictment looming over Donald Trump. The former president says that he expects to be arrested as soon as tomorrow in the Stormy Daniels hush money case. But the timeline remains unclear. Sources telling me that if and when the indictment happens, Trump is expected it expected to surrender, he'll have his mug shots and fingerprints taken, just like everybody else.
Trump's legal team is making a last minute push to discredit the district attorney's star witness, who is Michael Cohen. At their request, Cohen's former lawyer is set to testify today before the grand jury, and we're told that he came forward and offered evidence to contradict some of Cohen's claims.
So, let's discuss more now. I want to bring in CNN's Kara Scannell live outside the courthouse in Manhattan this morning. Good morning, Kara. What will we see, if anything, today?
KARA SCANNELL, CNN CORRESPONDENT: Well, good morning, Don. I mean, as you said, Attorney Bob Costello is expected to go appear before the grand jury today. He has represented numerous Trump allies, including Rudy Giuliani and Steve Bannon, and at one point, Michael Cohen. Several years ago, he was representing him in connection with this hush money investigation.
So, a source tells us that Costello had reached out to the Manhattan district attorney's office and attorneys for Trump saying that he had information that would contradict the testimony of Michael Cohen. You'll remember, Cohen pled guilty to federal charges, saying that he made these hush money payments in coordination with and at the direction of former President Trump.
So, Costello expected today, Trump's attorneys asked the D.A.'s office to bring him in. They think he's being brought in for the optics of it. But he will have the opportunity to go before the grand jury. Now, the D.A.s office has asked Michael Cohen to appear today as a possible rebuttal witness. Cohen saying on MSNBC over the weekend that he was asked to come in. He wasn't sure if it was to go before the grand jury or to meet with the D.A.'s office.
So, we're going to have a lot of activity today behind me in this building where the grand jury sets and where the D.A.'s office meets.
Now, over the weekend, with Trump's calls for protests, saying that he expects to be arrested and charged this week, the D.A.'s office sent an email to staff saying that they will not tolerate any attempts to intimidate them. Don? LEMON: All right. Kara Scannell live for us in Manhattan this morning, thank you, Kara.
HARLOW: House Speaker Kevin McCarthy is now vowing to investigate Manhattan's district attorney. Listen to this.
(BEGIN VIDEO CLIP)
MCCARTHY: It doesn't matter what side of the issue you're on. It doesn't matter if this was President Trump or if this was a Democrat. It should be equal justice in America. And stop going after people because you have political differences.
(END VIDEO CLIP)
HARLOW: Capitol Hill Reporter Melanie Zanona is live in Orlando where House Republicans are having their annual retreat. You're the one who interviewed Kevin McCarthy just a few months ago. Is this surprising?
MELANIE ZANONA, CNN CAPITOL HILL REPORTER: No, not at all. He is offering a full-throated defense of former President Donald Trump. He called an arrest an outrageous abuse of power. He said the Manhattan D.A. is radical. He attacked them. And he's even promised that Republican committees are going to investigate whether federal funds were used to probe this hush money payment. In fact, he told us at a press conference last night that he's already talked to Committee Chairman Jim Jordan about investigating this. He hinted that there could be action as soon as today. So, Republicans potentially moving pretty quickly to line up in defense of Trump.
But there was one area where Kevin McCarthy broke with Donald Trump, and that is over Trump's calls for protests if he is arrested. Take a listen.
(BEGIN VIDEO CLIP)
MCCARTHY: I don't think people should protest this, no. And I think President Trump, if you talk to him, he doesn't believe that either.
He's not talking in a harmful way, and nobody should. Nobody should harm one another in this.
(END VIDEO CLIP)
ZANONA: Of course, Kevin McCarthy was treading pretty carefully there. He has credited his entire speakership to Donald Trump, but interestingly enough, he has not actually endorsed Donald Trump for president yet, and I asked him last night, whether he thinks it's appropriate for Donald Trump to still run for president if he's ultimately convicted of a crime. But McCarthy said it's his prerogative and it's his constitutional right, Poppy.
HARLOW: That's a good question. That's a fascinating point that he hasn't endorsed him yet.
He just said, I don't think President Trump has called for that, but over the weekend, President Trump called for exactly that in terms of calling for protests and said, quote, take our nation back, if he is arrested.
ZANONA: Right. And you could tell that McCarthy was at the same time trying to break with Trump, trying to call for calmness, but he was also trying to defend Trump at the same time. He was trying to sort of explain away his comments for him.
And that's a common predicament for Republicans here. You know, they really wanted to focus this retreat on their upcoming policy battles. They wanted to strategize a plan to preserve their fragile majority in 2024, and instead they are playing defense for Donald Trump.
He has absolutely dominated the political conversation here so far at this policy retreat. Of course, that is frustrating for some Republicans. But at the end of the day, Trump is still a dominate force inside the House GOP. And so most Republicans are happy to defend him, Poppy.
HARLOW: Trump front and center once again at this Republican gathering. Melanie, thanks very much for the reporting.
COLLINS: Yes. A lot of speculation on what this could look like, but we have new reporting this morning on what's happening behind the scenes with another Trump investigation as prosecutors in Atlanta are considering bringing racketeering and conspiracy charges potentially in connection with Trump's effort to overturn the 2020 election in Georgia.
Don, you know, we have been talking about this, what this could look like, as this investigation may be potentially more damaging if this is something they decide to pursue.
LEMON: Well, you know that because you have been reporting extensively on all of these investigations as well. And we know they're not specifically, especially in Georgia, naming the former president, but you heard what the jurors who came out of that said. I think they said a momentous or it could huge, that's not the exact terminology. But we have been discussing this.
I have been talking with someone with knowledge of the investigation. They say prosecutors -- massive is the word that I was looking for, they say prosecutors have a large volume of substantial evidence related to a conspiracy from inside and outside of the state. That includes recordings of phone calls, emails, text messages, documents and testimony before a special grand jury.
Now, the Fulton County district attorney, Fani Willis, could make decisions on charges this spring. That is what the source is telling me. So, look to that.
CNN Senior Legal Analyst and former Federal Prosecutor Elie Honig is here to break it down. Elie, I'm so glad that you're here and talk about this because this is right up your alley. You have taught -- you know about this because you're a former federal prosecutor, but you have taught this sort of prosecution, with this RICO and conspiracy and racketeering, that's what you do.
ELIE HONIG, CNN SENIOR LEGAL ANALYST: Yes, class is in session. Are you ready?
LEMON: Class is in session.
HONIG: Okay. Here is why your reporting, Don, is so important. When we're thinking about how a case could be charged, you're always going to start with your base level crimes. And here, it appears the D.A. is looking at potential election interference and election fraud.
Now, you reported they're considering conspiracy. That's a loaded word. But all it really means is an agreement, a meeting of the minds between two or more people to commit a crime. And then if you go up to racketeering, now this is a really powerful tool that prosecutors use.
What you have to do is show two things. First of all, the existence of what we call a racketeering enterprise. That can be a mafia family, that can be a drug trafficking organization but it can also be a corporation or a political entity.
And then you have to show they engaged in what we call a pattern of racketeering activity, meaning that they committed two or more crimes in an organized fashion, which brings us to this other new piece of information, there's a third phone call. We already know about, of course, the infamous phone call to Brad Raffensperger, I just want to find 11,780 votes.
There's also a public recording of Donald Trump talking to this investigator, Frances Watson, when he tells her, when the right answer comes out, you'll be praised. Now, we know Trump also called the former Georgia speaker of the house asking him to convene a special session.
Now, Don, as we know, we have heard from some of the grand jurors, special grand jurors who have come out. They've told us that they've recommended indictments for more than a dozen people. Now, Fani Willis, though, will ultimately get the decision. That special grand jury cannot indict. If she wants to indict, she'll have to take the case to a regular grand jury.
Now, when is that going to happen? She told -- the D.A. told a judge 55 days ago that her decision was imminent, 55 days ago. So, I guess imminence is in the eye of the beholder.
LEMON: This is already a grand jury that's already sitting, is who would actually see this case?
HONIG: Yes, grand juries sit every two months. So, she can start whenever she wants.
LEMON: And I think we need to -- look, I just want to be clear about this. They're not naming the former president but you heard the jurors who came out who said this will be massive, and that is leading people to believe that it's the former president, but, again, not for sure.
HONIG: They're certainly suggesting but, correct, they've not named.
LEMON: I want to turn to Manhattan now because I also have reporting on that, but this possible indictment, and then the former president is saying, oh, it's going to happen on Tuesday, and the reason he's saying that is he's saying that it was leaks in the office. I'm not saying that specifically because of leaks and Bragg's office.
So, walk us through, if this does happen, we don't know if it's going to happen, if it does happen, their thinking is going to be possibly be Wednesday if it does happen. Walk us through potential criminal charges and what happens in Manhattan at this --
HONIG: So, of course, this brings us back to 2016, when Donald Trump paid $130,000 in hush money to the adult film actress, Stormy Daniels. Those payments went through Michael Cohen.
Now, making a hush money payment is not necessarily a crime on its own. What could be criminal here under, and we're in New York State law here. First of all, falsification of business records, if they falsely logged these payments as attorneys fee, that's just a misdemeanor, though, Don. No one realistically goes to prison on that kind of misdemeanor. However, if the prosecutors can show that that falsification of business records happened in order to promote some other crime, and here that would be a campaign finance violation, then we're looking at a felony.
Now, it's a class E felony, that's the lowest level. There's A through E. There is no F. That would be a maximum of four years in prison. But in class E, it's nonviolent, it's quite common for people to not get sent to prison at all.
And, of course, the big development today is there will be testimony in the grand jury, as Kara just reported, from Robert Costello. This is very unusual to have someone go into a grand jury and present evidence on behalf of a potential defendant. And so he, it appears, will try to undermine the prosecution's star witness, Michael Cohen.
LEMON: And let's be clear. Most likely, he would enter through an underground. You won't see him going in.
HONIG: There are all manner of tunnels and back entrances.
LEMON: And no handcuffs or whatever. But he will have his mug shot and he will be finger printed.
HONIG: Donald Trump, yes, anyone who gets arrested gets finger printed and gets a mug shot.
LEMON: Again, if this does happen. And then we also have the E. Jean Carroll lawsuit that is playing out as well. If you want to quickly -- if you want to just do that. HONIG: Yes. Well, at the same time, next month, there's a civil lawsuit. This is not a criminal case, but also downtown, just across the street, in federal court, E. Jean Carroll has sued Donald Trump for defamation. Remember, E. Jean Carroll alleged Donald Trump raped her in a Manhattan department store. Trump denied it, called her a liar. She has now sued him for defamation. So, that will be going to trial in front of a judge, Lewis Kaplan, who I've been in front of many times. He's a tough judge. He's a smart judge. He does not countenance fools. So, that will be interesting, happens next month.
LEMON: And we will be covering it. Thank you, Elie Honig, we appreciate it.
HARLOW: There's a lot there. We'll be on top of all of it.
Meantime, an emergency takeover of a huge bank this weekend, how it happened, what it means, how it will impact markets around the world, that is all ahead.
HARLOW: Just a stunning bank takeover this weekend. Switzerland's biggest bank, UBS, has agreed to buy its troubled rival, Credit Suisse, in an emergency deal that has rattled markets. European markets open slightly lower amid fears for the overall banking sector. In the opening minutes, shares of Credit Suisse tumbled as much as 62 percent. UBS shares were down 8 percent.
UBS is Switzerland's largest bank. Now, it agreed to buy Credit Suisse to try to ease the financial panic triggered by the collapse of Silicon Valley Bank and Signature Bank. This is the first rescue of a global bank since the financial crisis of 2008. Credit Suisse had been losing the trust of investors and customers for years. Authorities were very worried about the fallout, if it failed.
And this also comes as The New York Times has some fascinating new reporting on Silicon Valley Bank, quote, SVB's risky practices were on the Federal Reserve's radar for more than a year, an awareness that proved insufficient to stop the bank's demise, the Fed repeatedly warned the bank that it had problems.
Joining us now is the reporter behind that reporting, Federal Reserve and Economy Reporter for The New York Times Keanna Smialek, also our CNN Business Editor at Large Richard Quest.
Richard, let me just begin with you. You're joining us from Tokyo, but you know European banks better than almost anyone. Can you believe that this happened to Credit Suisse, this fire sale, and then just completely overriding any say of shareholders, the Swiss government stepping here in saying this must happen? It's stunning.
RICHARD QUEST, CNN BUSINESS EDITOR AT LARGE: It is stunning, but Credit Suisse was in pretty awful shape to begin with. It was limping along. And you know that old saying from Warren Buffet, when the tide goes out, you see who's swimming naked. Well, the tide ran out very fast, indeed, and there was nowhere else for Credit Suisse to go.
When you look at this particular deal, it's a shotgun marriage, to be sure, but there are some very odd intricacies, particularly relating to bondholders who have also been wiped out, and the feeling is that this itself could cause more turbulence when New York opens in just a few hours from now.
But for the moment, Poppy, they had no choice. Credit Suisse was going down, and as a systemically important bank, they couldn't allow it to take anybody else with it.
HARLOW: Richard, how do you think, though, this is different than the global financial crisis in 2008, because Credit Suisse had been plagued by problems, a lot of mismanagement for years?
QUEST: Firstly, the bigger banks, the main banks are much better capitalized. They've got tier three credit and reserves and assets way beyond what's necessary. And the second reason, the regulators themselves. They wouldn't have another Lehman moment. They are well aware now of the contagion risk and would move in -- well, they have moved in fast, Signature, SVB, Credit Suisse, the radar is like this at the moment. Because, Poppy, what this has shown on the downside is that there are banks potentially in trouble. And so the regulators are now on notice. We will move fast to deal with any crisis even before it gets going.
HARLOW: You're so right about that famous Warren Buffet quote, when the tide goes out, you basically see who's naked, you see who's most at risk.
Jeanna, let me bring you in here, because what's fascinating is that although the problems at Credit Suisse are so different than what happened at Silicon Valley Bank and Signature, the collapse of those banks is really what accelerated this or made this sort of a vortex that Credit Suisse collapsed into. I was fascinated by your reporting over the weekend about how many times the Fed, the San Francisco Federal Reserve, which has purview over SVB, warned them, six citations over the last year, that they had, quote, matters requiring attention and the SEC new that there was no interest rate hedge. So, why did nothing happen?
JEANNA SMIALEK, FEDERAL RESERVE AND ECONOMY REPORTER, THE NEW YORK TIMES: Yes. So, it's a really interesting question and I think kind of the key question of this episode, is the Fed had started giving these bank warnings years earlier, had given a range of warnings over the year before its crash.
And a lot of those warnings were specifically about the problems that we saw really bring down Silicon Valley Bank.