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Early Start with John Berman and Zoraida Sambolin

Russian Jets Harass U.S. Drones Over Syria; New Car Sales Defy Inflation, Rising Interest Rates; Soon: June Jobs Report Will Be Released. Aired 5:30-6a ET

Aired July 07, 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]

(BEGIN VIDEOTAPE)

VLADIMIR PUTIN, RUSSIAN PRESIDENT (through translator): I hope nobody stole anything while all this was going on, or didn't steal much. But, of course, we will deal with all of this.

MELISSA BELL, CNN PARIS CORRESPONDENT (voice-over): According to the Russian president himself, Prigozhin's catering company had received almost $2 billion in military and government contracts.

But it was Prigozhin's propaganda machine that Russian authorities targeted first, blocking media companies and websites linked to the man behind the failed push last week.

YEVEGENY ZUBAREV, DIRECTOR, RIA FAN (through translator): We are closing down and leaving the country's information space.

BELL (voice-over): Yet, in many ways, Prigozhin's empire may be too big to fail as the mercenary group still has a significant presence in Africa.

SERGEY LAVROV, RUSSIAN FOREIGN MINISTER (through translator): The fate of the agreement between those African countries and PMC Wagner is up to the leadership of those countries to decide.

BELL (voice-over): As to the fate of Prigozhin himself, his apparent home is now empty. The giant sledgehammer that symbolized the brutal Wagner Group abandoned. And its name, so long lionized and feared, now being erased as quickly as authorities can manage.

Melissa Bell, CNN Paris.

(END VIDEOTAPE)

RAHEL SOLOMON, CNN ANCHOR: Meantime, Russian fighter pilots have now repeatedly harassed U.S. military drones operating over Syria against ISIS targets. On Thursday, they intercepted American drones again, forcing evasive maneuvers. That is now twice in under two days.

CNN's Oren Liebermann has more.

(BEGIN VIDEOTAPE)

OREN LIEBERMANN, CNN PENTAGON CORRESPONDENT (on camera): For the second time in as many days, Russian fighter jets intercepted and harassed U.S. MQ-9 Reaper drones operating over Syria. This time, it occurred early Thursday morning. And the commander of U.S. Air Force Central Command, Lt. Gen. Alex Grynkewich, says those Russian fighters got dangerously close to the U.S. drones.

In this video you can see this encounter as it happened. You see as the Russian fighter jets get close and fly above and faster than the drone one of those jets begins dropping a series of flares. And it almost looks like the fighter jet is attempting to hit the drone with those flares.

This is very similar to what we saw the Russians do one day earlier. That's when three Russian fighter jets approached three U.S. MQ-9 Reaper drones and conducted very similar activity, which the Department of Defense called unsafe and unprofessional. In that case, one of those Russian fighter jets dropped parachute flares in front of the U.S. MQ-9 Reaper drone while another lit afterburner in front of the Reaper drone, which made it difficult to operate the drone in a safe manner.

Crucially, it's not just the U.S. that appears to be the target of these aggressive Russian activities. The French said they were also essentially harassed by a Russian fighter jet. This time, the French, on the official Twitter account of the French Armed Forces, said they had two of their Rafale fighter jets operating near the Iraq-Syria border when a Russian Sukhoi Su-35 fighter jet came up and operated in a non-professional manner. The French, according to this tweet, essentially averted any sort of risk and flew away.

We've seen this play out over several months. Back in April, a U.S. official told us it was essentially the Russians trying to operate in a new and more aggressive manner here, ignoring the deconfliction protocols that were specifically set up to avoid any sort of conflict or miscalculation between two of the most powerful militaries in the world.

Oren Liebermann, CNN, in the Pentagon.

(END VIDEOTAPE)

SOLOMON: Now to quick hits around the globe.

A toxic gas leak kills at least 17 people, including children. This happened in South Africa. Officials say the gas was nitrate oxide and the leak may be linked to -- the leak may be linked to illegal mining in that area.

The U.N. chief calling for an international police force to try to help stabilize Haiti after his recent visit there. He says that armed gangs continue to terrorize the Haitian people.

And the tourist who allegedly carved his name into Rome's 2,000-year- old Colosseum last month -- well, he is now apologizing in a letter to the local prosecutor. Ivan Dimitrov says he didn't realize how old the structure was. We'll see if that apology works.

Just ahead, new car sales defying inflation and interest rates. The question is why?

Also, a wild brawl on the ballfield. We'll take you there and tell you what started it next.

(COMMERCIAL)

[05:38:22]

SOLOMON: Welcome back, and here is today's fast-forward lookahead.

Later today, the U.S. will announce a new military aid package for Ukraine. This is going to include cluster munitions for the first time. They are banned by more than 100 countries but critically, not banned by the U.S. and Ukraine.

The Texas gunman who killed 23 people in a 2019 racist attack in an El Paso Walmart will likely be sentenced this morning. Thirty-six people gave victim impact statements.

President Biden set to give a speech today touting his health care agenda. The White House says he plans to announce actions to lower health care costs and crack down on junk fees.

New car sales in the U.S. have risen in the first half of the year at a pace that is far ahead of what was expected. Industrywide, vehicle sales totaled about $7.7 million from January to June. That's according to the research firm Ward Intelligence. So what is driving -- you got it there -- driving this trend?

Let's bring in Brian Moody. He is the executive editor for Auto Trader and Kelly Blue Book. Brian, welcome -- good morning.

So what is behind the trend?

BRIAN MOODY, EXECUTIVE EDITOR, AUTO TRADER AND KELLY BLUE BOOK (via Skype): Well, increased inventory is one thing that's behind that. And when we say that we just mean that there's more choices.

So a lot of consumers were looking for a car about a year ago and they didn't find what they wanted or the prices were too high. So now we see more selection and more inventory, and we know that the average price is still high but they have what they want. That's one thing driving it.

SOLOMON: So if inventory has returned to healthier levels -- I mean, walk me through what that has done to prices because as you say, it's still high -- not lower? Because I would expect that to mean prices.

[05:40:00]

MOODY: Well, in a roundabout way it is. So we know that average transaction prices are pretty high. There's one thing to keep in consideration when we're talking about averages. Today, people who are buying new cars -- about 20 percent of them -- it's around 18 percent are opting for a luxury car. That's higher than it has been in the past and that brings the average up. So there still are ways that you can find a car that's a decent price.

But at the same time, we know that the average price or the average age of a used car on the road today is about 12 years old. So there's a little bit of pent-up demand and there are some people out there who are, like, I put off my purchase already. It's long enough.

And there are some incentives. When inventory goes up incentives go up --

SOLOMON: OK.

MOODY: -- and that helps to negate some of the price increases.

SOLOMON: Brian, how about monthly payments? I mean, during the pandemic, I saw a number even in the sevens -- monthly payments in the sevens for new cars.

MOODY: Right.

SOLOMON: What are monthly payments looking like now?

MOODY: Well, they're still averaging in the $700 range. But in some cases, you can see people that are paying $1,000 or more per month for a car. And the reason for that is credit is more difficult to get right now and the interest rate is a little higher.

Personally, I think that's quite a bit of money to spend for a monthly payment on a new car. There are ways that you can help to bring that down but one of those ways is don't go out and buy the popular thing. Don't buy what everybody else is buying.

SOLOMON: Brian, I have to let you go. But before I do, is now a good time to buy a car? If someone is watching, thinking should I wait, should I buy it now, what do you say?

MOODY: Yes. If you go look for something like a sedan or a hatchback, or something that isn't super popular, you can probably get a good deal.

SOLOMON: Brian Moody, great to have you. Thank you -- of Auto Trader and Kelly Blue Book.

MOODY: Yes, thank you.

SOLOMON: Well, Britney Spears is speaking out after she says that she was slapped by a security guard for the NBA's number-one draft pick.

Carolyn Manno has this morning's Bleacher Report. Carolyn, this is really making the news -- making the rounds.

CAROLYN MANNO, CNN SPORTS CORRESPONDENT: Yes, it is. This is a very bizarre story and we're getting more details in the days to come, I hope. I mean, this is kind of sports and entertainment colliding in Las Vegas.

Britney Spears filing a police report alleging battery after she was hit in the face by one of Victor Wembanyama's security staff. So the popstar says that this happened at a restaurant when she tried to get the 19-year-old Spurs rookie's attention.

She posted her side of the story on Instagram of what she says is, "I decided to approach him and congratulate him on his success. I simply tapped him on the shoulder. His security then back-handed me in the face without looking back, in front of a crowd."

Wembanyama told reporters that he didn't actually see what happened and that he was unaware that it was Britney Spears that was the one involved until hours later.

(BEGIN VIDEO CLIP)

VICTOR WEMBANYAMA, SAN ANTONIO SPURS CENTER: And that person was calling me sir, sir, and that person grabbed me from behind. So I didn't see -- I didn't see what happened because I was walking straight and didn't stop. But that person grabbed me from behind -- not on my shoulder. She grabbed me from behind.

And so I just know that the security pushed her away. I don't with how -- with how much force, though. But security pushed her away and I didn't stop to look, so I kept walking.

(END VIDEO CLIP)

MANNO: The Las Vegas Police Department says that no arrests or citations have been issued in this. CNN has reached out to both Spears and Wembanyama, as well as the Spurs for comment. The seven-foot-four French phenom set to make his summer league debut tonight in Vegas -- but a bizarre dust-up.

In baseball now, Reds outfielder Nick Senzel pretty much single- handedly stole a win from the Nationals last night. With the score tied at three in the bottom of the ninth inning, he made a spectacular leaping catch against the right field wall to keep Washington from a walk-off. That was just the beginning of the heroics.

After that play right there in the top of the 10th, he blasted a two- run shot that turned out to be the game-winner. So the Reds have now hit a home run in 20 straight games.

Cincinnati ended up winning 5-4 for their first series sweep in Washington since 2006.

The Mets shut out the Diamondbacks 9-0 last night. It wasn't without drama. Catcher Francisco Alvarez was hit in the wrist by Jose Ruiz's pitch in the seventh inning and Alvarez stared him down before slowing walking to first base. The home plate umpire immediately got in front of him to make sure it didn't escalate, but the benches ended up clearing anyway. Cooler heads would eventually prevail. Both teams slowly went back to their dugouts. But tempers flaring elsewhere on the diamond as well. This is one of the Guardians top prospects in the minors pushing an umpire before taking a swing at a catcher in a minor league game. George Valera ejected after the punch, which triggered a bench-clearing brawl between the Columbus Clippers and the Nashville Sounds. Both players eventually kicked out of the game. The pitcher kicked out of the game as well. So some bad behavior here from everybody in the majors and the minors.

And the very bizarre story -- just back to Victor Wembanyama. I know Chloe Melas will have a lot coming up in the next hour with this Britney Spears incident.

SOLOMON: Yes.

MANNO: But very strange and two sides to the story in terms of the actual contact that was made.

SOLOMON: Right. Because he says that someone grabbed him. She says she tapped.

MANNO: That's right.

SOLOMON: I think that will be really important.

But a lot of dust-ups in your Bleacher Report today.

[05:45:00]

MANNO: Yes, it's been a bit of a brawl here for you this --

SOLOMON: Yes.

MANNO: -- Friday morning.

SOLOMON: Carolyn Manno, thank you. Have a great weekend.

MANNO: You, too.

SOLOMON: All right. Coming up on "CNN THIS MORNING" chaotic, unhinged, and talks of martial law. What the special counsel investigating Trump wants to know about a 2020 meeting in the Oval Office.

And the June jobs reports will be released in a couple of short hours. What we could expect coming up next.

(COMMERCIAL)

SOLOMON: Welcome back.

And looking at markets around the world, Asian markets look solidly lower. European markets a bit mixed. You can see Tokyo, Hong Kong, Shanghai composite all off. Let's call it about three-tenths of one percent to about 1.2 percent in Tokyo's case. London off about a quarter of a percent. Paris and Frankfurt, however, higher. Let's take a look at U.S. markets, meantime. U.S. markets also lower but let's call it fractionally lower. Stocks fell on Thursday on what seemed like good news that the U.S. job market remains steaming hot. But the Dow fell just over one percent. That's its biggest single-day decline since May. The Nasdaq and the S&P both dropped eight-tenths of a percent.

[05:50:08]

Meantime, U.S. businesses added nearly half a million jobs in June, and that's according to private payroll processor ADP. And it's more than double the 220,000 jobs economists had expected.

And in just a couple of hours, the Bureau of Labor Statistics will release its June jobs report. So let's bring in Julia Poliak. She is the chief economist at ZipRecruiter. Julia, thanks for being on the program. And as I understand it, you are in California, so it is even earlier for you. We really appreciate you being here.

First, what are you expecting with the June jobs report?

JULIA POLIAK, CHIEF ECONOMIST, ZIPRECRUITER (via Webex by Cisco): I'm expecting another big report. The jobs report has surprised economists 14 times since January of 2020. I think we shouldn't be surprised anymore by a blowout number.

SOLOMON: In terms of what metrics you watch very closely, the jobs report gives us all sorts of data -- hours worked, part-time workers, unemployment.

What do -- what are you watching very closely?

POLIAK: So I think the big picture number to look at is aggregate hours worked in the economy. So that's the number of jobs added. It's the number of working hours in the workweek. And then the other thing to look at is what people are making -- what they're earning. And put those altogether and if that number is going up you can expect the U.S. consumer to remain strong and to keep spending -- keep going on vacation -- and businesses to feel pressured to keep hiring.

SOLOMON: And how about wages? I mean, if we start to see wages continue to moderate, actually, and growth remain strong, and unemployment remains low, does that mean that a soft landing looks more likely?

POLIAK: It definitely is starting to look more likely. Inflation is coming down quite meaningfully and wage growth has been moderating steadily. And that suggests that inflation could keep coming down in the coming months.

SOLOMON: And Julia, when you are speaking with companies that use ZipRecruiter clients, what are you hearing about the labor market from their point of view?

POLIAK: So, companies were very cautious going into this year. They heard warnings that there would likely be a downturn so they took a wait-and-see approach. But the consumers rocked up. Customers are lining up outside the gates. And so, companies are now having to scramble.

You know, the holiday hiring push this year started later than normal and many companies are now playing catch-up. And that's another reason why I think we can expect to see a big report. This catch-up hiring taking place across the economy now.

SOLOMON: Are companies finding it easier to find workers?

POLIAK: They are. Labor force participation has meaningfully improved. We have the lowest hospitalization and death rates due to COVID since the start of the pandemic, and so that has made people feel safer coming back to work. We've also seen a big recovery in immigration numbers and visa, so -- numbers. And so that all is helping businesses find it easier to find workers.

On ZipRecruiter, there are about 40 percent more applications per job posting now than there were this time last year, and that's a very, very big change.

SOLOMON: Oh, that is a very big change. Really good news for those workers as well and apparently, companies.

Julia Poliak, great to have you today, of ZipRecruiter.

POLIAK: Thank you.

SOLOMON: Twitter now threatening to sue Meta after the launch of Meta's new Twitter rival, Threads. A lawyer for Twitter sent this letter to Meta accusing it of stealing trade secrets by hiring former Twitter employees. A Meta spokesman rejected the accusation, saying on Threads, "No one on the Threads engineering team is a former Twitter employee. That's just not a thing."

Threads has, meantime, experienced explosive growth since its official launch Thursday. Meta reported 30 million sign-ups on the platform's first day. It's really incredible.

Well, coming up on "CNN THIS MORNING" more on the Secret Service probe into cocaine found at the White House. And Congresswoman Marjorie Taylor Greene's future uncertain as fellow GOP lawmakers give her the boot.

(COMMERCIAL)

[05:58:27]

SOLOMON: Twenty-five million people across the Central U.S. are under severe storm threats today and intense heat expected for at least seven million in the Southwest, along with fire danger and red flag alerts.

Let's go to meteorologist Britley Ritz in the weather center. Britley, relief. When are people going to see relief? BRITLEY RITZ, AMS METEOROLOGIST: I know, Rahel, and eventually it'll come. But until then we are talking about record-breaking temperatures once again. Yesterday, Tucson hit 110 degrees and broke their previous record that was back in '89 at 109 degrees.

The Southwest -- no relief just yet. Excessive heat warnings still in effect, as well as heat advisories where temperatures will likely reach up around 115 degrees. Phoenix, 113 by Sunday. And no relief into the upcoming workweek either as temperatures climb almost 10 degrees above normal, if not more. One hundred sixteen Wednesday and Thursday. Averages around 107.

Now, where it's raining -- yes, we've got some relief. That rain- cooled air is always a blessing. Highs today dropping into the 60s in places like Omaha. And remember, temperatures all relative so that comes to a shock.

But here we are once more with that chance for severe weather. With that heat and humidity it just fuels along each side boundary. And you see what we're highlighting in yellow. Those are severe thunderstorm watches from the Texas to Oklahoma Panhandle. And a handful of severe thunderstorm warnings yet this morning with winds over 60 miles per hour.

Holding onto that threat throughout the afternoon and evening and once again into tomorrow morning. Areas highlighted in yellow where we have more of that wind and hail risk, as well as isolated tornadoes. But it can't be ruled out as far north as Fargo and, again, back into the Northeast.

[06:00:04]

Take a look at the timeframe Friday morning. Here we are at 11:00 with them dying down, but ramping back up anywhere between I'd say 8:00 and 9:00. Holding onto that threat across the Central Plains back down into the Texas Panhandle once again, and rolling into tomorrow morning, Rahel.

SOLOMON: Oh, Britley. Thank you.

RITZ: Yes.

SOLOMON: And thank you for joining us. I'm Rahel Solomon. Have a wonderful weekend. Meantime, "CNN THIS MORNING" starts right now.