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Early Start with John Berman and Zoraida Sambolin

Nine Crew Members Arrested On Suspicion Of Human Trafficking; Ukraine: "Some" Steady Counteroffensive Success; Chinese President Xi Meets With Bill Gates. Aired 5:30-6a ET

Aired June 16, 2023 - 05:30   ET

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

[05:30:00]

MELISSA BELL, CNN CORRESPONDENT: But it is the tales they brought back with them that are particularly harrowing. You mentioned, Christine, that figure of 40 children believed by the United Nations to have been on board. What the survivors say is that they believe the figure may have been higher.

And what is terrible when you think about it is to imagine this boat, which Greek authorities sank, had been in distress for several hours, hence the questions about what more could have been done -- but did, once it started to sink, go down within 10 to 15 minutes.

It was in the hold that the women and children were traveling, and they say -- the survivors say there may have been up to 100 of those children -- so pretty horrific scenes. You can imagine the scramble as they understood that they were going down.

Of the survivors, as you mentioned, nine have now been arrested on suspicion of people trafficking, but the real question is much broader than that, of course, Christine. It is for Europeans, it is for Greek authorities, it is for Italians those very Coast Guards who had been alerted several hours before the boat went down that it was in distress. With NGOs, the patrol here in the Mediterranean, worrying that this could only get worse.

This has become the most deadly migrant crossing in the world. Since 2014, the United Nations reckons that 20,000 people have lost their lives or disappeared in the Mediterranean. Those are of the recorded cases -- the recorded cases by the United Nations. Of course, the fear of those who work for the NGOs that patrol the waters is that it could actually be much higher. There are the small boats that you never hear about --

CHRISTINE ROMANS, CNN ANCHOR: Right.

BELL: -- and the bigger boats that are so difficult to count. We simply don't know how many people exactly were on it, Christine.

ROMANS: You know -- and Melissa, it occurs to me that it is well known -- the dangers. Imagine how difficult that decision must be to take your family in such a -- just such an awful trip. How terrible and dangerous home is to leave home and know that you're facing those risks. Just awful.

All right, thank you so much, Melissa Bell.

BELL: Exactly.

ROMANS: All right. Ukrainian -- thanks, Melissa. Ukrainian officials claiming some steady counteroffensives against Russia. Military leaders say Ukraine has made progress over the past week, including in the hard-fought areas of Bakhmut and Zaporizhzhia. Moscow claims it is repelling any advances and is not giving up any territory.

CNN's Salma Abdelaziz is live for us this -- from London this morning. Bring us up to speed here. What do we know is happening on the ground?

SALMA ABDELAZIZ, CNN CORRESPONDENT: Slowly but surely, gradually but steadily. I think these are the words that we are hearing repeated again and again by Ukrainian officials. The Ukrainian military saying that it has had some partial success, particularly along two parts of the front lines.

The north -- Bakhmut, of course, a city that's been a flashpoint for many months now where they say that in about the last 10 days, Ukrainian forces have been able to gain -- to push three kilometers into those Russian front lines, and then further to the south along Zaporizhzhia -- to the south of Zaporizhzhia. There they say that they have been able to liberate -- the Ukrainian military has been able to liberate about 39 square miles -- 100 square kilometers of territory.

But you have to remember Russia has been preparing for this counteroffensive as well, fortifying its positions all along that hundreds of miles of battlefield that you see. And if you take a look at the math, probably -- perhaps one of the most fortified areas is that very critical area to the south of Zaporizhzhia.

You can understand why that's so important for Moscow to hold onto. It's part of that land bridge that connects Crimea to the rest of that battlefield. That land bridge means supply routes. It means access to the Black Sea and the Sea of Azov. It is absolutely critical for the Kremlin to continue to hold onto the territory. But for Ukraine, the goal here is to pierce through those defensive positions and cut that land bridge off.

But don't expect this to happen anytime soon. Again, Russia has been preparing. Ukraine is going to take this slowly and try to find weaknesses and capitalize on them.

ROMANS: All right, Salma. Thank you so much for that. Nice to see you.

Quick hits around the globe right now.

Two Americans have been found dead in their luxury hotel room in Baja, Mexico. The victims' family says the couple was sick for days. Officials are still investigating the cause of death.

An American woman has died after she and a friend were pushed down a slope near a popular tourist attraction in Bavaria, Germany. Police say a suspect faces multiple charges, including murder and sexual assault.

At least nine people are dead and 23 injured in India after Cyclone Biparjoy made landfall on Thursday. More than 100,000 people were evacuated ahead of that storm.

All right. Just ahead, the Justice Department finishing its probe of Minneapolis police. What we could learn later today.

Plus, together right now in Beijing, Bill Gates and Chinese President Xi.

(COMMERCIAL)

[05:38:56]

ROMANS: Here is -- here is today's fast-forward lookahead.

Attorney General Merrick Garland heading to Minneapolis today. He is set to announce the findings of a Justice Department investigation in the Minneapolis Police Department.

Thousands of UPS drivers across the country are expected to authorize a strike in voting that closes today after months of contract negotiations. It would be among the largest work stoppages in decades.

Secretary of State Antony Blinken heading to Beijing today to stabilize U.S. relations with China. His trip was originally set for February but was postponed after those Chinese spy balloons.

All right. Just a short time ago, Chinese President Xi Jinping met with Microsoft co-founder Bill Gates in Beijing. It was Xi's first meeting with a foreign CEO in recent years since he stopped traveling abroad as China shut its borders during the pandemic.

Kristie Lu Stout live in Hong Kong with more. And Kristie, it's so interesting. Elon Musk, the Starbucks CEO, and now Bill Gates. You've seen the parade of CEOs going to China -- Jamie Dimon from JPMorgan Chase.

What do we know about this meeting with Bill Gates?

[05:40:00]

KRISTIE LU STOUT, CNN ANCHOR AND CORRESPONDENT: Yes, this is what we know. Bill Gates -- today, he met with Chinese leader Xi Jinping in Beijing. This is Xi's very first meeting with a Western business figure in recent years.

And according to state media, Xi called Gates the first, quote, "American friend" he has seen this year. He also said that the foundation of China-U.S. relations is, quote, "in the people."

Now, Bill Gates is in China to discuss global health issues with the Bill & Melinda Gates Foundation. And according to the state-run broadcaster CCTV, this is what the

Chinese leader told Bill Gates earlier today. Let's bring it up for you. He said, "In today's world situation, we can carry out all kinds of activities that will benefit our two countries, our two peoples, and humanity as a whole. Let's all be facilitators in this regard."

Now, on Thursday, the foundation renewed its ties with the Beijing government and Tsinghua University to develop treatments for infectious diseases all around the world.

But it was on Wednesday when Bill Gates announced on Twitter that he had touched down in Beijing for the first time in five years. Let's bring up his tweet for you. He said this. Quote, "Solving problems like climate change, health inequity, food insecurity requires innovation. From developing malaria drugs to investing in climate adaptation. China has a lot of experience in that." He goes on to say "We need to unlock that kind of progress for more people around the world."

Just a reminder it was a couple of years ago in 2020 -- that was when Gates stepped down from the Microsoft board to focus on global philanthropy.

But, yes, he joins that parade -- that long list of Western private- sector leaders who have visited China ever since it reopened earlier this year -- from Elon Musk of Tesla, Jamie Dimon of JPMorgan; Tim Cook of Apple -- the list goes on. And while Beijing has been rolling out this red carpet for Western business figures, tensions are high between the U.S. and China.

And we have America's top diplomat, Antony Blinken -- he's going to be visiting this weekend in order to reset relations. But Christine, look, Xi Jinping, today -- he met with Bill Gates. We still don't know whether Blinken will have a meeting with Xi Jinping.

Back to you.

ROMANS: Interesting.

All right, Kristie Lu Stout. Thank you so much. Nice to see you.

STOUT: Thank you.

ROMANS: All right. Records were shattered in a thrilling first round at the U.S. Open in Los Angeles.

Carolyn Manno has this morning's Bleacher Report. Nice to see you.

CAROLYN MANNO, CNN SPORTS CORRESPONDENT: Good morning. Nice to see you, too.

This has been a really fun look at such an exclusive golf course and a lot of experts actually thought that the layout at the Los Angeles Country Club was going to be a challenge for the world's best golfers. Nobody expected the show that Rickie Fowler and Xander Schauffele would put on. Fowler grew up about two hours away from this course. He fired off 10

birdies and two bogies to finish with an 8-under 62. That is the lowest single-round score ever recorded in a U.S. Open.

Xander Schauffele, meanwhile, also not far from home. He's from San Diego. He was feeling it, too, yesterday. He had eight birdies and no bogies to make Rickie's 8-under.

Both of these guys considered two of the best to never win a Major. Now they are hoping to carry this momentum into today's second round.

(BEGIN VIDEO CLIP)

RICKIE FOWLER, 5-TIME PGA TOUR WINNER: It's definitely been long and tough -- a lot longer being in that situation than you'd ever want to. And -- but it makes it so worth it having gone through that and being back where we are now.

XANDER SCHAUFFELE,7-TIME PGA TOUR WINNER: It's not really what you expect playing in the U.S. Open, but monkey see-monkey do. I was just chasing Rickie up the leaderboard, so I'm glad he was just in front of me.

(END VIDEO CLIP)

MANNO: Here's a look at the leaderboard heading into today.

Northern Ireland's Rory McIlroy is the only non-American inside the top five. He was actually on track to beat Fowler and Schauffele's record after making the turn at 5-under, but could only add one more birdie on the back nine.

But a lot of people looking at Rickie, too.

The U.S. Men's National Team back in action against rival Mexico in Las Vegas last night. U.S. captain Christian Pulisic scoring twice within 10 minutes on both sides of the halftime break in the nominating 3-nil win.

But this one ended in very ugly fashion. Four players were ejected after dirty tackles and the pushing and the shoving that followed. And this actually went from bad to much worse. The referee stopping the match about four minutes early amid homophobic chants from the crowd. The U.S. is going to be back on the pitch Sunday against Canada. No love loss between those two but a very nasty ending result.

The mood, undoubtedly, much more festive in Denver, though. Thousands of fans lining the streets to celebrate the Nuggets' first NBA Championship. Check out this dynamic duo, finals MVP Nikola Jokic and Jamal Murray riding in an armored SWAT vehicle while the rest of the team made it to City Hall on fire trucks.

And after going viral for his comments about wanting to go back home to Serbia right after the finals, Jokic admitted that sticking around was a pretty good idea after all.

(BEGIN VIDEO CLIP)

NIKOLA JOKIC, 2023 NBA FINALS MVP: You know that I told that I didn't want to stay and parade, but I (bleep) want to stay and parade. This is the best day of my life. Yeah, this is -- this is amazing. This is -- we are all going to remember this our whole lives. And then we see you guys that came out on the streets and actually, this one is for you. We love you, Denver. This one is for you.

(END VIDEO CLIP)

[05:45:03]

MANNO: There we go. It's all coming full circle now staying on the parade.

The Nuggets going to get their championship rings when the new season starts in October.

They are going to be hard-pressed, Christine, to outdo the Kansas City Chiefs Super Bowl bling. The team handing out this hardware at a private ceremony last night. So, each ring contains 613 diamonds, 35 rubies, with more than 16 carats. And the top of the ring is removable. It can actually be worn as a pendant. And the underneath is a model of Arrowhead Stadium. So not too shabby.

Although I feel like you're so financially savvy, Christine, that you would feel like maybe somebody should put this in the stock market instead or in a desk. It would be ludicrous to put this thing on your hand.

ROMANS: I mean, those guys deserve it -- they really do. What a season.

MANNO: They do.

ROMANS: All right. Thank you so much. Nice to see you, Carolyn.

Coming up on "CNN THIS MORNING" the light of dawn unveiling a deadly path of destruction left by a deadly tornado in the Texas Panhandle.

And next, right here, Americans' shrinking retirement nest egg.

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[05:50:08]

ROMANS: All right, welcome back this Friday morning.

Your Romans' Numeral today, $112,000. The average balance of employer- sponsored savings plans last year was just over 112 grand. Remember, last year was the worst year for stocks since 2008. The S&P 500 fell 18 percent -- a tough year. And you can see it in that nest egg. That nest egg well below the nearly $142,000 in 2021.

An annual Vanguard report shows the numbers are even worse when you look at the median balance. That reduces the effective outliers. The median balance was just over $27,000 last year. You've got to keep saving.

All right. Looking at markets around the world, Asian markets finished higher. China is expected to unveil fresh stimulus to kickstart its slowing economy. European markets also slightly higher here as traders digest a rate hike by the European central bank.

On Wall Street, stock index futures this morning moving up here. It was a higher day -- a relatively strong day in markets yesterday. The S&P 500 and the Nasdaq closed at their highest in 14 months. The Dow ended the day up more than 400 points.

Mortgage rates ticked down for the second week in a row, folks. A 30- year fixed now at 6.69 percent.

On inflation watch, gas prices fell another penny overnight to $3.58 a gallon there.

All right, a pivotal week in the economy this week. Inflation is cooling but still too high. The Fed pauses but says don't get used to it. Oh, and the stock market enters an official new bull market.

Let's bring in John Leer, chief economist at the Morning Consult. This riddle that is the American economy gives us something new to scratch our heads over every single day.

Talk to me a little bit about the Fed move this week. You said it was a little bit of a headscratcher, right? The Fed is still concerned about core inflation and says it's going to keep hiking, but stopped for now?

JOHN LEER, CHIEF ECONOMIST, MORNING CONSULT (via Webex by Cisco): Yes. I'm a little concerned that the Fed I think is trying to have their cake and eat it, too. That they sort of want -- you know, they acknowledge that economic activity is going to be fairly robust through the end of this year. That inflation is going to run persistently elevated through the end of this year. And yet, they are pausing and they're going to wait to see how some of the interest rate hikes that they made earlier in the year are going to play out.

My concern is that it's basically what we're seeing I think right now in financial markets, which is that there's this risk that they're going to lose credibility and that folks are going to sort of assume that the Fed would prefer to see this sort of immaculate disinflation rather than driving inflation lower and potentially causing some level of economic harm.

ROMANS: Let's listen to something that the Fed chief said about what has been a very resilient labor market -- listen.

(BEGIN VIDEO CLIP)

JEROME POWELL, CHAIRMAN, FEDERAL RESERVE: The labor market I think has surprised many if not all analysts over the last couple of years with its extraordinary resilience, really. And it's just remarkable.

And that's really -- if you think about it, that's what's driving. It's job creation. It's wages moving up. It's supporting spending which, in turn, is supporting hiring. And it's really the engine it seems that is driving the economy.

(END VIDEO CLIP)

ROMANS: It's really been fascinating to watch the job market. And at some point -- I mean, you have to ask can you have a recession if you have a 3.7 percent unemployment rate and a job market that keeps performing like this?

LEER: No -- no, you can't, especially if you have 339,000 jobs created in a month. I mean, one of the defining features of a recession is jobs growth in aggregate and we have never met that criteria over the last two years while everyone has been on recession watch.

I do think it will become harder and harder for the economy to continue to add jobs in the second half of the year. But again, we have fairly strong momentum right now and I think a lot of my concerns from earlier in the year were predicated on the Federal Reserve being fairly aggressive in fighting inflation. It feels to me like they're more willing right now to sort of take a wait-and-see approach.

ROMANS: And just quickly -- I mean, what is the chance that this is what a soft landing looks like?

LEER: It's very possible. But I also think it's very possible that people mistake a soft landing for essentially changing inflation expectations, embedding inflation into the economy, and moving into a new normal where we have three to four percent inflation on average.

ROMANS: All right, John Leer, at the Morning Consult. Thanks for dropping by, and have a great weekend.

LEER: Thank you -- you, too.

ROMANS: All right, three people are dead and more than 70 injured after a series of tornadoes ripped through the South. How officials are responding in the small town hit the hardest, ahead.

(COMMERCIAL)

[05:59:06]

ROMANS: All right. Our top of the morning, the top songs on Apple Music right now.

(BEGIN VIDEO CLIP)

LIL' DURK FEATURING J. COLE: Singing "All My Life."

(END VIDEO CLIP)

ROMANS: So, number one is "All My Life." Lil' Durk featuring J. Cole.

(BEGIN VIDEO CLIP) MORGAN WALLEN, SINGER: Singing "Last Night."

(END VIDEO CLIP)

ROMANS: Morgan Wallen's "Last Night" is at number two.

Here is number three.

(BEGIN VIDEO CLIP)

ESLABON ARMADO AND PESO PLUMA, SINGERS: Singing "Ella Baila Sola."

(END VIDEO CLIP)

ROMANS: "Ella Baila Sola." Eslabon Armado and Peso Pluma on that one.

All right, now to a rockstar looking to take his career in a whole new direction.

(BEGIN VIDEO CLIP)

ROD STEWART, SINGER-SONGWRITER: Singing "Da Ya Think I'm Sexy?"

(END VIDEO CLIP)

[06:00:00]

ROMANS: When mother would turn the radio up when she heard that when I was in the car with her.

Rod Stewart says after his tour ends this summer he wants to focus his attention on making jazz music. He tells Sky News after singing his songs "Hot Legs" and "Maggie May" for 50 years it's time for a change.

Stewart has already released the "Great American Songbook," which sold 27 million copies. He did a swing album with Jools Holland. He says he still expects to sing those old songs -- the old hits maybe on occasion. What a career.

All right, and thanks for joining me. I'm Christine Romans. Have a great weekend, everybody. "CNN THIS MORNING" starts right now.