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Early Start with Rahel Solomon
Trump's Trade War; Lady Gaga Concert Attack Foiled; Israeli Security Cabinet Approves New Gaza Operations; Russia-Ukraine Ceasefire Negotiations. Aired 4-4:30a ET
Aired May 05, 2025 - 04:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[04:00:00]
RAHEL SOLOMAN, CNN ANCHOR: Good morning and welcome to our viewers joining us from the U.S. and all around the world. I'm Rahel Solomon. It is Monday, May 5th, 4:00 a.m. here in New York. And straight ahead on EARLY START.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Investors and businesses still waiting to hear any concrete details on deals in the works.
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We're negotiating with many countries but at the end of this I'll set my own deal.
UNIDENTIFIED FEMALE: President Donald Trump on Sunday evening posted something on social media this idea of wanting to reopen and rebuild Alcatraz to house criminals.
UNIDENTIFIED MALE: Police say Lady Gaga's long-awaited return to Brazil was almost marked by tragedy.
UNIDENTIFIED MALE: Our police and intelligence received information that there would be a plan to commit a bomb attack.
(END VIDEO CLIP)
SOLOMON: We begin this hour with President Donald Trump sitting down with NBC News over the weekend to discuss a wide range of issues from the Constitution to Greenland, Alcatraz, and Mexican cartels. But the biggest news continues to be on concerns about the economy and Trump's trade war. President saying that he is confident that good things will come from trade deals.
Take a listen.
(BEGIN VIDEO CLIP)
TRUMP: We're negotiating with many countries, but at the end of this, I'll set my own deals because I set the deal. They don't set the deal. I set the deal.
They've been ripping us off for years. I set the deal. Every country, almost without fail, friend and foe, has been ripping us off for years.
So we're meeting with almost all of them, including China. And at the end, I'm setting the deal.
(END VIDEO CLIP)
SOLOMAN: The president also saying that tariffs would eventually be lowered on China as both Beijing and Washington appear to soften their positions on potential trade talks. Tariffs on auto parts went into effect this weekend. Trump hopes that that will help bring manufacturing back to the U.S.
And now a new focus for tariffs, foreign made movies. The president asking for a 100 percent tariff, although it's not clear how it will be implemented. Movies are considered intellectual property, not something that can currently have a tariff on it.
Also, over the weekend, big news, Warren Buffett announcing his retirement as CEO of Berkshire Hathaway, the legendary investor, using the occasion to suggest that there is such a thing as an economic act of war and that trade shouldn't be used as a weapon.
All right, let's take a look and see how U.S. futures are shaping up at 4 a.m. on a Monday morning, all lower across the board from about half a percent for the Dow to about, let's call it, six tenths of a percent for the S&P and the Nasdaq.
OK, let's bring in Ryan Patel, who is a senior fellow at Claremont Graduate University's Drucker School of Management, and he joins us live this morning from Los Angeles. Ryan, we appreciate you being up early for us or staying up late with us either way. Good to have you this morning.
Look, it'll be an eventful week. We had those new auto part tariffs that went into effect over the weekend. The Fed begins their two day meeting tomorrow and then these new comments from the president. I want to start there and I want to play for you something he said over the weekend. Take a listen.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: When does it become the Trump economy?
TRUMP: It partially is right now. And I really mean this. I think the good parts of the Trump economy and the bad parts of the Biden economy, because he's done a terrible job.
(END VIDEO CLIP)
SOLOMAN: Ryan, objectively, when does the economy and the data reflect the moves of this administration, the Trump administration?
RYAN PATEL, SENIOR FELLOW, DRUCKER SCHOOL OF MANAGEMENT, CLAREMONT GRADUATE UNIVERSITY: Not soon. I mean, if you're thinking about what the Trump economy is, I would explain what he's trying to do would be the deals and the tariffs. So for that to really work, it's going to have to be look at from one year to year and a half to really see how the economy has grown, not just in the short term, Rahel, is really focused on, did you bring back more manufacturing in the U.S.? Are there other companies producing more? That would be the metrics.
You have to have some metrics behind it, not just the market. So to really see if the Trump economy is working, you really have to see it at that point.
SOLOMAN: What about the labor market and concerns that some of these tariffs and some of the trade war could cause some impacts to U.S. workers in the near term?
PATEL: Yes, I mean, I think that's what the talking point was. I think when he was in that Meet the Press interview, you know, it was kind of he was firing shots toward Powell to make sure that everyone knows he could replace him soon.
[04:05:00]
And but, you know, to have stability, like you were mentioning about unemployment, to be able to have the GDP, which wasn't really a great first quarter, contracted just a little bit down. It allows the Fed to make a pause and to that degree.
SOLOMAN: Yes, let's talk about the Fed and Chairman Jay Powell. Despite the president saying pretty recently that his termination can't come soon enough over the weekend, he said this.
(BEGIN VIDEO CLIP)
TRUMP: He should lower them, and I wish the people that are on that board would get him to lower because we are at a perfect time. It's already late, but he should lower interest rates.
UNIDENTIFIED FEMALE: Do you rule out removing Fed Chair Jerome Powell?
TRUMP: You know, I get to change him very quickly anyway. You know, it's in a very short period of time.
UNIDENTIFIED FEMALE: In 2026. You're not going to remove -- you don't have plans to remove him before 2026 when his time's up?
TRUMP: No, that was a total -- why would I do that? I get to replace the person in another short period of time.
(END VIDEO CLIP)
SOLOMAN: So pretty clear there. Why would he do that? I mean, he's right. The chair's term does end pretty soon.
How much comfort, Ryan, does that give to the markets between that on Chair Powell, but also the walking back of the rhetoric on tariffs? Does that mean that peak turbulence, peak volatility is now behind us at the worst is behind us?
How do you see it? PATEL: You and I hope so, but that's not the case. I mean, let me answer the first part. The first part is, I think President Trump was smart on this case for allowing Jerome Powell to finish his term because removing him before that will cause even more turbulence. And I think he realizes that.
I think the second piece to this, there is going to be turbulence because coming up this week, the Fed most likely will not change the interest rate. So what does that mean for the markets this week?
They're not going to be pretty happy, even though they know it's not coming and -- know that's not coming. And when is that interest rate going to change? President Trump is trying to put pressure.
I mean, if it's not now, is it in June? Probably not -- July. Best case scenario to see the data changes.
You know, they're going to be looking at the data in May. And I don't think there's going to be much big difference from May to June.
SOLOMAN: Yes, is there an economic case, Ryan, taking the politics out of it for a moment for the Fed to lower rates? You have inflation, which is just just a touch above where the Fed's long term goal is. You have growth that is slowing. Is there a case to be made for lowering rates now as the president is calling for?
PATEL: Well, I think here's the thing, it's the variables. Right. And I'm not to say the tariffs are to blame for it, but the market, the businesses, investments, the cutbacks, that is still unknown.
And so for the Fed to decide to make that cut now and then a month from now, it starts to go a little bit haywire. Then they put themselves in a predicament that they got to this point. So, I mean, the Fed doesn't want to put them -- I mean, they've been very conservative over the last 12 months. So for them to wait to make a mistake now for what they think is a mistake, I don't see them making that move until they're almost 100 percent sure. And we kind of move backwards a little bit over the last couple of months.
SOLOMAN: Yes, certainty is certainly something that is hard to find these days, whether you're talking about the economic data or just sort of the road ahead. Ryan Patel, appreciate you being here. Thank you.
All right, President Trump says he doesn't know if he has to uphold the U.S. Constitution. He was speaking on NBC's Meet the Press on the right to due process for people living in the U.S.
(BEGIN VIDEOTAPE)
UNIDENTIFIED FEMALE: Your secretary of state says everyone who's here, citizens and noncitizens, deserve due process. Do you agree, Mr. President?
TRUMP: I don't know. I'm not I'm not a lawyer. I don't know.
UNIDENTIFIED FEMALE: Well, the Fifth Amendment --
TRUMP: It seems -- it seems it might say that. But if you're talking about that, then we'd have to have a million or two million or three million trials.
UNIDENTIFIED FEMALE: But even given those numbers that you're talking about, don't you need to uphold the Constitution of the United States as president?
TRUMP: I don't know. I have to respond by saying, again, I have brilliant lawyers that work for me. And they are going to obviously follow what the Supreme Court said.
What you said is not what I heard the Supreme Court said. They have a different interpretation.
(END VIDEOTAPE)
SOLOMAN: He's also seeking clarification from the Supreme Court on the Abrego Garcia ruling, but he did seem more clear on the merits of seeking a third term as president.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Has anyone in an official capacity presented you with, sir, here are some ideas by which you could actually get a constitutional --
TRUMP: Well, in the capacity of being a big supporter of many people have said different things --
UNIDENTIFIED FEMALE: OK.
TRUMP: -- but I'm not looking at that.
(END VIDEO CLIP)
SOLOMAN: President was also asked about his administration's targeting of universities, law firms and the media. When asked what he would say to those who believe that he's taking the country down an authoritarian path. Trump said that he was elected with a lot of votes and that, quote, those people are going to be very happy.
[04:10:00]
And Trump says that he is directing the Bureau of Prisons to reopen Alcatraz, the former penitentiary on an island off the San Francisco coast. In a social media post. Sunday, the U.S. President said that he wants Alcatraz to house America's most ruthless and violent offenders. He later told reporters that it was just an idea he had because of what he called radicalized judges who want to ensure due process for migrants.
The federal government closed Alcatraz in 1963 because it was too expensive to operate. It's now a popular tourist destination. Major staffing shortages is causing historic delays at one of the busiest airports in the U.S. Newark Liberty International Airport in New Jersey has seen widespread delays for now an unprecedented seven consecutive days. At last check, there were more than a dozen delays and even more cancellations at Newark today. That's according to Flight Aware.
U.S. and airline officials say that other factors are also contributing to the delays, including a lack of air traffic controllers at the airport and nationwide, as well as technology failures caused by outdated equipment.
Police in Rio de Janeiro say that Lady Gaga's long awaited return to Brazil on Saturday was almost marked by tragedy. Our Julia Vargas Jones has the latest on the alleged plots targeting the pop star's massive concert.
(BEGIN VIDEOTAPE)
JULIA VARGAS JONES, CNN CORRESPONDENT: Disconcerting new details emerging as we're learning, one man believed that Lady Gaga had a Satanist religious inclination, and as such, he wanted to respond in the same way by carrying out a satanic ritualistic killing of a child or a baby on a live stream during her show.
This man had been watched by U.S. consulate who alerted authorities in Rio de Janeiro, and now he's charged with terrorism and inducing crime. In total, 15 warrants of search and seizure were carried out across Brazil in four different states.
This is also unfolding as we're learning an extremist group that communicated on Discord was posing as little monsters or Lady Gaga fans online, recruiting participants, including underaged people, to orchestrate attacks with improvised explosives and Molotov cocktails at the concert.
The leader of this organization was arrested in southern Brazil for illegal possession of a firearm, as well as a teenager who was in possession of child pornography. The police said that they carried out this work with discretion and precision to avoid panic of the crowds.
But the Lady Gaga team did say that they were not aware of these threats before the event, saying, quote, We learned about this alleged threat via media reports in the morning. Prior and during the show, there were no known safety concerns, nor any communication from the police or authorities to Lady Gaga regarding any potential risks.
Her team worked closely with law enforcement throughout the planning and execution of the concert, and all parties were confident in the safety measures in place.
We did speak, though, to one of the concert goers who told us a little bit about what it was like to find out the next day that they had been a target of a potential terror attack.
DANI MORERA TRETTIN, CONCERTGOER: To know that there was a group actively targeting us and the LGBTQ plus community definitely put a bitter taste in my mouth. I mean, I am glad that they didn't tell people about what was going on and they did it with discretion because I believe that could have caused some major panic and would have caused many people not to come.
JONES: Lady Gaga, of course, has amassed a massive following in the LGBTQ plus community. Has been a staunch defender of the rights of that community for years. But she also seems to not have let this terror attack plan put a stain on what was a very successful show.
She posted on Instagram on Sunday, thanking her fans and saying, quote, Your heart shines so bright. Your culture is so vibrant and special. I hope you know how grateful I am to have shared this historical moment with you.
Julia Vargas, Jones, CNN, Los Angeles.
(END VIDEOTAPE)
SOLOMAN: Jury selection begins later today in the federal trial of music mogul Sean Diddy Combs. He has pleaded not guilty to five charges that include racketeering, conspiracy, sex trafficking and transportation to engage in prostitution. If convicted, he could spend the rest of his life in prison.
Among the witnesses that we are expecting to hear from is Combs' ex- girlfriend, Cassie Ventura. Video that shows Combs assaulting Ventura in 2016 will be shown during the trial, which one expert says will be key to this trial.
(BEGIN VIDEOTAPE)
MISTY MARRIS, DEFENSE ATTORNEY: The video is also something that the lawyers are thinking about going into jury selection.
[04:15:00]
There will be jury questionnaires and the jury -- the jurors, the individual prospective jurors will be questioned about things like intimate partner violence, whether or not they have been a victim of it or someone they know has.
So all of that is going to be incredibly important to the case. And Cassie's testimony is really going to be key for the prosecution.
(END VIDEO CLIP)
SOLOMAN: All right, still ahead for us, Russian President Vladimir Putin hopes that there will be no need to use nuclear weapons in Ukraine. Coming up, the latest on the U.S. brokered peace efforts to end the conflict.
Plus, Israel is planning to expand its operations in Gaza. We'll explain what it could mean for Palestinians who live there.
And would President Trump really use military force to take control of Greenland? What he's saying about that coming up.
(COMMERCIAL BREAK)
SOLOMAN: Welcome back. Two Israeli officials tell CNN that Israel's security cabinet has approved plans to expand military operations in Gaza. The Israeli army released this video on Sunday. Army officials say that it shows Israeli troops in Rafah.
One Israeli official tell CNN that the new plan for Israel's war in Gaza involves, quote, the conquest of territory and remaining there. They also say that the Israeli military will displace the Palestinian population to southern Gaza while carrying out, quote, powerful strikes against Hamas.
Israel says that it's ordering -- that the Israeli military will displace the Palestinian population to southern Gaza while carrying out, quote, powerful strikes against Hamas.
Israel says that it's ordering tens of thousands of reservists to report for duty in the coming days. And the security cabinet approved a new framework for getting aid into Gaza. Israel has blocked all aid into Gaza for nine weeks now. The new aid framework has not yet been implemented.
Meanwhile, Israeli Prime Minister Benjamin Netanyahu is issuing issuing new warnings to Yemen's Houthi rebels and to Iran. They follow Sunday's Houthi missile strike near Israel's main airport. No one was injured. It's causing concern because most missiles fired at Israel are intercepted. Mr. Netanyahu says that Israel will strike back against the Houthis and their backers in Iran.
Let's go to CNN's Paula Hancocks, who is live in Abu Dhabi for more. Paula, talk to us about what's the latest on Israel's military operation in Gaza.
PAULA HANCOCKS, CNN CORRESPONDENT: So, Rahel, this was a plan that had been put forward by the IDF chief of staff to expand the operations in Gaza. And according to two Israeli officials, it was approved by the security cabinet on Sunday.
Now, one key difference that appears at this point is that the Israeli military will less be focusing on raids in certain areas, but they will be focusing on occupying certain parts of the Gaza territory and holding that territory. So that's one key difference that appears within this this new plan.
And it comes just after tens of thousands of reservists, it was announced, would be called up in coming days to be able to carry out this expansion of the Gaza operation. Now, we also understand from these Israeli officials that they will move the Palestinian population in Gaza south, so to the southern part of the Gaza Strip, to allow the Israeli military to focus on Hamas in the north.
This is not the first time they have done this. We did see this a number of times with the population being moved and displaced repeatedly across Gaza by the Israeli military. And also there is a plan to deny Hamas, we understand from the Israeli side, to be able to to to give out any aid, any humanitarian aid that's allowed in.
That is now going to be taken over by the the Israelis. But they -- we understand there will be an unnamed international framework that will be distributing this aid as opposed to to Hamas itself.
But of course, this hasn't been implemented at this point. So up until now, it's been almost two months that we have seen no humanitarian aid whatsoever getting into Gaza, no food, no water, no heat, no fuel for hospitals or medical supplies. And the warnings have been increasingly dire by humanitarian aid groups, by the United Nations as to the situation on the ground.
In fact, we heard from the head of pediatrics at the Nasser Medical Complex within Gaza saying they're facing dangers of a massive wave of deaths due to malnutrition. Reports coming to us as well of of one two month old dying of malnutrition over the weekend. So that situation is becoming increasingly dire.
Now, when it comes to the increase in the military operations, we understand from these Israeli officials that it will be a gradual increase as they are going to give a chance for a ceasefire to be agreed between Hamas and Israel to release the hostages this coming just a week before the U.S. President Donald Trump is expected in the region -- Rahel.
SOLOMAN: Paul Hancock's reporting for us here in Abu Dhabi. Paula, thank you.
The week ahead will be pivotal for negotiations on the war in Ukraine. In an interview with NBC News, when asked if a peace agreement between Russia and Ukraine is near, President Trump said, quote, I hope so. This after his administration threatened to walk away from the talks if progress wasn't made soon.
Meantime, President Vladimir Putin believes that Russia has the strength to end the conflict on his terms. And he recently told state TV that he's hopeful that nuclear weapons will not be needed.
(BEGIN VIDEO CLIP)
VLADIMIR PUTIN, RUSSIAN PRESIDENT (through translator): They wanted to provoke us so that we made mistakes. There's been no need to use those weapons you just talked about, and I hope it won't be required. We have enough strength and means to bring what was started in 2022 to a logical conclusion with the outcome Russia requires.
(END VIDEO CLIP)
SOLOMAN: Meanwhile, President Volodymyr Zelenskyy is urging allies to put more pressure on Russia to end the fighting in Ukraine. Otherwise, he believes Moscow won't take any real steps to do so.
Let's bring in CNN's Clare Sebastian joining us from London with more on all of this.
[04:25:00] Clare, what's the latest here?
CLARE SEBASTIAN, CNN CORRESPONDENT: Well, look, Rahel, case in point, Ukraine says that Russia fired 116 drones and two ballistic missiles overnight. Drone attacks have doubled since December -- between December and March. So all as you know, the Trump administration undertook this peace effort.
And I think, as you noted for President Zelenskyy, despite the fact that they have now this win of the mineral deal, this document that essentially calls Russia the aggressor and enshrines this U.S.-Ukraine economic partnership, I think there's a very real concern that the U.S. and perhaps some other allies are not willing to translate this talk of extra pressure on Russia into action.
We heard President Trump over the weekend saying that he had good conversations about Russia and Ukraine, not even willing to openly criticize Russia, as we've seen him do in recent weeks. He said, look, we're closer to getting somewhere with one party, not so close with the other. But he wouldn't say which was which.
And I think that's why you hear comments like this from President Zelenskyy in Prague on Sunday. Take a listen.
(BEGIN VIDEO CLIP)
VOLODYMYR ZELENSKYY, UKRAINIAN PRESIDENT (through translator): In my opinion, if Ukraine is strong, the war will be over as soon as possible. United States and our European colleagues have all instruments at their disposal to preserve alliance between the United States and Europe is a top priority. To force Russia to agree on full and unconditional ceasefire, it was a proposal by the U.S. and we supported it, is also a priority task. I think level of pressure will directly depend on the alliance and its strength.
(END VIDEO CLIP)
SEBASTIAN: So, look, Russia, as you noted, has not signed on to this 30 day proposed ceasefire that Ukraine accepted almost two months ago. Now, it has proposed a three day ceasefire coming into force at the end of this week over the Victory Day celebrations. Ukraine has not only not agreed to that, but President Zelenskyy in comments at the end of last week said that foreign leaders traveling there should be aware that Ukraine wasn't providing any guarantees.
And I think it's worth noting as well, Rahel, Ukraine isn't waiting around to find out if its calls to its allies, including the U.S., to step up the pressure are going to be answered. Russia overnight said that it shot down some 26 drones, including four over the Moscow region. That's four days out now from that all important flagship Victory Day parade.
And also, we got news over the weekend that Ukraine claims that it used a sea drone to shoot down a Russian fighter jet. This appears to be the first time this has happened, but shows that Ukraine, despite not having a functioning Navy, is still able to take the fight to Russia in the Black Sea and still has cards to play in this conflict -- Rahel.
SOLOMAN: Clare Sebastian reporting in London for us. Clare, thank you.
All right, just ahead, how Republicans are using the prospect of a third Trump impeachment to get out the vote in next year's midterms.
Plus, we'll take a look at how President Trump's influence around the world played a role in Australia's pivotal election. We'll be right back.
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