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Early Start with John Berman and Zoraida Sambolin
China Indefinitely Delays Release Of Key Economic Data; U.K. Prime Minister "Sorry" For Economic Mistakes, Vows To Stay On; K-pop BTS Members To Begin Mandatory Military Service In South Korea. Aired 5:30-6a ET
Aired October 18, 2022 - 05:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
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SELINA WANG, CNN INTERNATIONAL CORRESPONDENT (voice-over): -- lost access to the savings at several banks in the region. As police violently quashed the protesters, Beijing arrested hundreds of suspects allegedly involved in the scandal and promised that depositors would start to get their money back, but many still have not.
UNIDENTIFIED MALE: (Speaking foreign language).
WANG (voice-over): "This is my family's hard-earned money over the last 20 years," he says. "Our lives depend on it."
WANG (on camera): How is the whole experience changed your perception of your country -- of China's leaders?
UNIDENTIFIED MALE: (Speaking foreign language).
WANG (voice-over): "I'm like an ant that they can trample on. I have no hope," he says.
Another crisis is unfolding in China's all-important property sector. Giant developers have defaulted. Home sales are dropping. Homebuyers across the country are boycotting mortgage payments on unfinished homes fearful that their properties will never get built. These protesters chant "Evil developer, give back my property."
PROF. KERRY BROWN, CHINESE STUDIES, KING'S COLLEGE, LONDON: The Chinese property market is probably the world's greatest economic asset -- single economic asset. If it does collapse, then we have a full-blown recession -- maybe even depression.
WANG (voice-over): Xi Jinping is preparing to be ruler for life, claiming that his brand of authoritarianism will realize the China dream of strength and prosperity. But for people like Hu, all he wants is to make ends meet and even that is a dream out of reach.
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WANG: And Christine, a lot of Xi's policies are actually making China's economic challenges even worse. But from that opening speech at the Communist Party Congress, Xi made it clear that he's not going to change what he's been doing. In fact, in the third term, expect to see even more Communist Party control over the economy, over private businesses.
And when it comes to zero-COVID, which has absolutely upended China's economy and millions of people's lives -- well, Xi hailed that as a great success. So that policy, too -- don't expect that to go anywhere anytime soon.
CHRISTINE ROMANS, CNN ANCHOR: A great success but you won't see its GDP report for any kind of proof or confirmation there.
Selina Wang, thank you so much.
All right. The Biden administration officially rolling out the application for student loan forgiveness. And Britain's new prime minister apologizing for a failed budget that rattled the financial markets.
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LIZ TRUSS, BRITISH PRIME MINISTER: Now I recognize we have made mistakes. I'm sorry for those mistakes.
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ROMANS: All right. New U.K. Prime Minister Liz Truss acknowledging in a new interview that she went too far too fast with reforms that touched off economic turmoil in Britain.
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TRUSS: Now I recognize we have made mistakes. I'm sorry for those mistakes. But I fixed mistakes. I have appointed a new chancellor. We have restored economic stability and fiscal discipline. And what I now want to do is go on and deliver for the public.
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ROMANS: CNN's Scott McLean is live in London. You know, to call it a mistake -- I mean, she crashed her currency and set her debt market in absolute turmoil. Is Liz Truss in trouble here?
SCOTT MCLEAN, CNN CORRESPONDENT: It sure seems that way, Christine. Look, there is an impression in this country that Liz Truss is a prime minister who is no longer in control of her own government, and yesterday, she didn't do a whole lot to dispel that notion.
Her brand-new chancellor, on the job for only a few days, stood in the House of Commons to announce that almost all of the measures that were announced in her now-infamous mini-budget were being scrapped. So that now includes a planned basic income tax cut, a planned cut to
the dividends tax, a planned income tax cut for the highest earners, and a plan to cancel corporate -- a corporate tax hike. So the estimated total savings here is about $36 billion U.S. dollars -- money that the government hadn't actually accounted for in the first place.
Now, some smaller, less expensive items did survive the cull, but even her very signature promise to subsidize energy bills -- that is only going to survive in its current form until April.
The markets, though -- they seem to like this. The U.K. stock index -- the FTSE 100 -- it was up. The pound gained ground against the dollar as well. It's almost at the level that it was when Liz Truss first took office now.
But all of this leaves Liz Truss in a pretty awkward position because the signature campaign promises that got her -- that won her the leadership in the first place have clearly not worked. She is now having to rely on the ideas that were campaigned on by her leadership opponent, Rishi Sunak. And so, a lot of people in this country are asking the question what is the point?
A handful of conservative MPs have already called for her resignation. A recent poll shows that the opposition Labor Party is twice -- twice, Christine, as popular as the conservatives. And just this morning, a junior cabinet minister was asked how many chances Liz Truss has left, and his answer was not very many -- Christine.
ROMANS: All right, Scott McLean. Thank you so much.
Climate activists are stepping up their shock tactics to try to get attention for their causes. This has the British government planning to crack down.
CNN's Isa Soares has more.
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ISA SOARES, CNN ANCHOR AND CORRESPONDENT (voice-over): Milk -- the latest pantry item to be used by protesters in the U.K. to call attention to cause they say is being ignored. On Sunday, activists poured milk on the floors of shops around the country, even dousing the meat counter at Harrod's with it.
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The group, Animal Rebellion, says it organized the stunt to protest the lack of support for farmers and fishing communities from the U.K. government in transitioning to a plant-based future.
In recent weeks, climate and environmental protests have stepped up their shock tactics across the U.K. to get their message out. On Friday, anti-fossil fuel protestors from the Just Stop Oil campaign stunned museumgoers at London's National Gallery by throwing tomato soup at Vincent Van Gogh's "Sunflowers" painting and gluing their hands to the wall.
UNIDENTIFIED FEMALE: Are you more concerned about the protection of a painting or the protection of our planet?
SOARES (voice-over): London police said the protesters were arrested on charges of criminal damage. The museum says the painting is now back on display with only minor damage to the frame.
And though the act grabbed plenty of headlines, it's caused mixed reactions.
UNIDENTIFIED MALE: I mean, obviously, I was relieved -- very relieved that it was protected. And I just think that they need to choose which things to highlight their causes more.
UNIDENTIFIED MALE: They could do something a bit more positive I think rather -- and maybe more educational and just make a (INAUDIBLE).
UNIDENTIFIED MALE: I mean, it's getting people talking about it, which I guess is what they want. But then how are you going to get people to listen unless you do something drastic?
UNIDENTIFIED MALE: I have climbed up this cable of the QE2 bridge --
SOARES (voice-over): Just Stop Oil activists have been staging disruptive protests in London for weeks. On Monday, police had to shut down a major bridge because protesters were scaling it. Over the weekend, protesters blocked traffic by laying in the road. And at least one activist spraypainted an Aston Martin showroom.
U.K. Home Sec. Suella Braverman says protests like these drain police resources and says she is bringing forward a public order bill that will give authorities more powers to prevent these types of disruptions that are favored by some environmental groups.
The planned climate march by activist group Extinction Rebellion also took place in London. And while there was no soup or milk spilled here the crowd had a similar message about the urgent need for action on climate change.
LAURA BALDWIN, ENVIRONMENTAL ACTIVIST: It's so simple to get us off the streets. It's just to act on the climate and nature crisis.
SOARES (voice-over): Isa Soares, CNN, London.
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ROMANS: All right, Isa. Thank you for that report.
France running on empty right now, crippled by a fuel crisis there. And mandatory military service for all seven members of the K-pop supergroup BTS.
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ROMANS: All right, Romans' Numeral today, 14, as in 14 years. It has been 14 years since the stock market has been this bad.
You have to go back to 2008 when the S&P 500 crashed 38 1/2 percent to end the year. The S&P, this year, is down 23 percent, the worst showing since the bad old days of the Great Recession.
The S&P matters here. It is an index of 500 stocks and most likely it reflects the stock portion of your retirement funds. It's insult on top of injury here with high inflation and higher interest rates. James Carville famously coined the phrase "It's the economy, stupid." And with three weeks to go until the midterms it is true today.
A New York Times/Siena poll showed inflation and the economy far and away the top concern of Americans, more than abortion, crime, or anything else.
Now come the closing arguments. President Biden rolling out the student debt forgiveness portal this week.
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JOE BIDEN, PRESIDENT OF THE UNITED STATES: This is a game-changer for millions of Americans, but I want to be clear who is going to benefit the most -- working people, the middle class.
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ROMANS: It's no mistake this came on the very same day over-the- counter hearing aids became available for the first time, saving families time and money.
Republicans will hammer so-called Bidenomics, though. They will try to tie global inflation to the president's policies.
On debate stages last night, Republicans, again and again, turned the conversation to the economy and crime. Three weeks to go. We'll see how those closing arguments bear.
At least for now, global markets are bouncing back. European markets higher. The U.K. ditched the rest of its controversial tax cut plan, while the E.U. zeroes in on high energy costs.
On Wall Street, stock index futures, right now, moving higher after a rally Monday on strong earnings from Bank of America, BNY Mellon, and Charles Schwab.
The Dow rose 550 points, back above 30,000. Best day for the Nasdaq since July. The S&P 500 jumped by more than two percent after declining for the past five weeks.
Several tech giants will report earnings later this week, including Netflix, Tesla, IBM.
And gas prices dropping a penny overnight to $3.87 a gallon. All right, heated moments between the Ohio Senate candidates. Their second debate even more contention than the -- contentious than the last. And Kevin Spacey breaking down in tears as he faces sex abuse allegations in court.
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ROMANS: All right, from the stage to the service. All seven members of the K-pop supergroup BTS will fulfill their mandatory military duty in South Korea.
CNN's Paula Hancocks has more.
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PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT (on camera): This announcement today has ended months of speculation. Will they? Won't they? We now know that BTS will be going into their mandatory military service. We heard from the label, Big Hit Music, saying, quote, "They respect the needs of the country."
Now, this has been under speculation, as I say, for months. This has been debated within the South Korean Parliament itself as to whether or not BTS should be exempted or whether they should be carrying out their mandatory service.
It is a conscription that all able-bodied men between the ages of 18 and 28 do need to go and serve in the military. Now it was increased by two years just a couple of years ago to the age of 30 just for those who excel in popular culture and art. So it did defer somewhat the decision for BTS and gave them some breathing space.
But the argument for their exemption is that there are some sportsmen who have won Olympics medals, Asian Games medals, who have been exempted from military service. There's also some classical musicians -- award-winning, global musicians and singers that have been exempted as well. But it was decided, then it was debated at length that BTS should go ahead.
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Now, they had a concert just on Saturday in the southern seaside city of Busan here in South Korea. It was believed at the time to be the last scheduled concert that we were going to see from this supergroup and clearly, it is going to be the last for some time.
BTS had announced back in June that they were taking a break to pursue solo pursuits. But now, obviously, with military service, that's going to be pushed back even further.
Big Hit Music saying, quote, "Both the company and the members of BTS are looking forward to reconvening as a group around 2025." So certainly, the BTS army, as their very passionate fans are known, will be forward to that date. Paula Hancocks, CNN, Seoul.
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ROMANS: All right. Thanks, Paula.
The Chargers get an ugly win in overtime against the Broncos thanks to a gutsy performance from their kicker.
Andy Scholes has this morning's Bleacher Report. Hey, Andy.
ANDY SCHOLES, CNN SPORTS CORRESPONDENT: Yes, good morning, Christine.
Yes -- I'm not really sure anyone really wanted to win this game last night. It was the first time in 30 years a game went into overtime, and there were four punts and no first downs.
Now, the deciding play came with the Chargers punting. The Broncos' Montrell Washington muffs it after his teammate was blocked right into him. So the Chargers get the ball at the 28-yard line and Dustin Hopkins, who tweaked his hamstring earlier in the game, coming through in the clutch. He's going to make his fourth field goal.
Chargers win 19-16 to get to 4-2 on the season.
And Hopkins got to do the rare kicker postgame interview on the field.
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DUSTIN HOPKINS, LOS ANGELES CHARGERS KICKER: If it was going to hurt, what's the difference if it's 20 or it's 55? It was just like well, give it a rip and that was it. I don't even know -- I don't know a single distance from field goals today.
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SCHOLES: All right, Tua Tagovailoa, meanwhile, is set to make his return to action Sunday against the Steelers. The Dolphins quarterback has been sidelined since September 29 after suffering a concussion. That head injury so soon after a similar incident against the Bills led to the NFL making an amendment to their concussion protocols.
Tua began football activities last week and was cleared Saturday, but was inactive for the Dolphins loss to the Vikings.
All right, imagine spending three hours at the ballpark only to be told to go home -- there won't be a game tonight. Well, that's what happened to Yankee fans last night in the Bronx.
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UNIDENTIFIED MALE: They should have canceled the game earlier if they saw the weather was that bad. Why did they make us wait two hours- 2 1/2 hours in our seats?
UNIDENTIFIED MALE: I took off tomorrow, anyway, so we'll be ready to go for tomorrow.
UNIDENTIFIED MALE: Yes, I spent about 200 bucks tonight. I want my money back. This is garbage -- absolute garbage.
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SCHOLES: So, the decisive game five against the Guardians was supposed to be at 7:00. At 6:20, Major League Baseball said the start was going to be delayed due to rain, but then the game was completely called off at 9:30. So you can imagine some of those fans not happy. A long night for them. They're now going to have to go back today at 4:00.
Whoever wins is going to have no time to rest. Game one against the Astros in the ALCS is tomorrow. The NLCS between the Padres and Phillies starts tonight.
The NBA season, meanwhile, tips off as well tonight. The Warriors' Klay Thompson says he's pumped to start the team's title defense.
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KLAY THOMPSON, GOLDEN STATE WARRIORS GUARD: Man, it's going to be tough to sleep Monday night. And I'm so happy Chase Center got a championship. It's going to be a special, special night that Warrior fans will never forget. The same with the players, staff, front office, everybody. I have no idea what the rings look like but it's going to be so cool and I'm going to try and just enjoy every single second of it.
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SCHOLES: Yes, Klay and the team getting those rings tonight.
Sixers and Celtics are going to tip things off. That's followed by Steph Curry and the Warriors hosting LeBron and the Lakers. Both of those games on our sister network TNT.
All right, Christine, always an exciting time of year with the NBA tipping off --
ROMANS: Yes.
SCHOLES: -- football midseason, and the baseball's postseason.
ROMANS: Yes.
SCHOLES: Always something to watch.
ROMANS: Big productivity drain in America when you have so much to choose from.
All right, Andy. Nice to see you. Thank you so much.
SCHOLES: All right.
ROMANS: Thanks for joining me. I'm Christine Romans. "NEW DAY" starts right now.
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REP. TIM RYAN, (D), OHIO SENATE CANDIDATE: You were calling Trump America's Hitler, then you kissed his ass.
J.D. VANCE, (R) OHIO SENATE CANDIDATE: That's not true.
RYAN: It is true. And then you kissed his ass, and then he endorsed you. And you said he's the greatest president of all time.
EVAN MCMULLIN, (I) UTAH SENATE CANDIDATE: You were there to stand up for our Constitution, but when the barbarians were at the gate, you were happy to let them in.
SEN. MIKE LEE (R-UT): I think I disagree with everything my opponent just said, including the words "but" and "and the."
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