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CNN Live Today

Al Qaeda Could Target Financial Sector

Aired August 02, 2004 - 11:00   ET

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

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


DARYN KAGAN, CNN ANCHOR: American on alert. Three cities begin the workweek with a specific and detailed terror threat. For New York City, Washington and Newark, New Jersey, it is far from business as usual this morning.
Officials say that al Qaeda could target five financial centers, the International Monetary Fund and the World Bank in Washington, Prudential Financial in Newark, Citigroup in New York City and the New York Stock Exchange as well.

Some of the specifics in the new terror alert according to the Associated Press, al Qaeda, it says, has been tracking the flow of pedestrians outside one building apparently to determine how many people could be killed in a single attack.

The quality of explosive materials, whether they could get hot enough to melt the steel underpinnings of a building. Specifics on building reconnaissance, how structures could be quietly observed. And the locations of police and fire stations, schools and hospitals near specific targets.

Sean Callebs is covering the developments in homeland security this morning. He joins us from World Bank headquarters in Washington, D.C.

Sean, good morning.

SEAN CALLEBS, CNN CORRESPONDENT: Good morning, Daryn.

Indeed, the World Bank and IMF buildings behind me getting a great deal of attention today. Employees who showed up for work this morning noticed some somewhat drastic security changes.

There are security guards outside now checking IDs before employees even get inside the door, more security guards on the other side of the building, also an added presence of D.C. police in this area as well.

They have been randomly stopping trucks throughout the day just making checks to see what it is inside. No problems reported at this point.

The IMF and World Bank buildings are also located on a busy intersection here in downtown Washington, a great deal of traffic, both pedestrian and vehicles. And it's also -- we have a map here showing you -- only a couple of blocks from the White House. Now, later on this afternoon, World Bank president James Wolfenson, who was on vacation when he found out about these security warnings, and came back to D.C. last night and had security meetings with department of homeland security as well as IMF officials.

Now, he is going to hold a meeting with the several thousand World Bank employees who work here, a town hall gathering, if you will. It's an effort to try and allay concerns.

Now, throughout the day we have had a chance to speak to some employees as they make their way in and out of the building. And they maintain it is going to be business as usual, almost.

(BEGIN VIDEO CLIP)

UNIDENTIFIED WASHINGTON, D.C. RESIDENT: I was worried, obviously, but I trust the system that the government set up -- the alert system.

UNIDENTIFIED WASHINGTON, D.C. RESIDENT: I have a job to do and I'm not going to let somebody I don't know where they are and what they're doing stop me from doing my job.

UNIDENTIFIED WASHINGTON, D.C. RESIDENT: They are in constant contact with the authorities and FBI and that if they learn something more, action will be taken. As of now, we're open for regular business.

(END VIDEO CLIP)

CALLEBS: When asked how the employees here are faring, a spokesman for the World Bank said, he wouldn't be telling the truth if he said that there weren't some nerves that were rattled.

And there has been some detailed information that Daryn went through just a moment ago, that secretary of homeland -- homeland security chief -- Tom Ridge spelled out yesterday.

Now, we know the World Bank has been in close contact with the deputy director of homeland security last night, also talking with IMF officials as well. D.C. police also say that they are going to make an increased presence in this area.

One thing they have said, they don't want to put up barricades in this area. They want to keep this area open. And also the D.C. mayor yesterday making a move that homeland security did not, D.C. is elevating security in this entire city, not just to the financial institutions -- Daryn?

KAGAN: And it still is the busy summer tour season there in Washington, D.C. For folks who are planning on visiting the nation's capital, most things still open?

CALLEBS: Most things open. I think that's one thing that the mayor came out and said last night, the police chief came out and said last night, if you're going to shop, if you're going to visit, if you're going to have friends out, if you're going to go out and do things, don't alter your schedule.

They really believe that they have enough coordination among agencies and with that detailed information that homeland security has, they are doing everything they can to make this city as safe as possible.

KAGAN: Sean Callebs in the nation's capital. Sean, thank you for that.

From there, let's go to the nation's financial capital. Anxious workers in New York's financial district had to make their way through new barriers and more police this morning. That's where we find our Deborah Feyerick. She is outside the New York Stock Exchange with more on the new terror threat.

Deb, good morning.

DEBORAH FEYERICK, CNN CORRESPONDENT: Good morning, Daryn.

Well the traders came to work this morning a bit more tense but ready to start the day. Many of them were here on 9/11, just blocks from the World Trade Center. They say that this kind of uncertainty has simply become a way of life.

Now, the New York City mayor was also here sending a very, strong message that the city is open, that business will go on, that whatever threats might be out there, not enough to shut the city down.

Trucks are being searched in and around Wall Street. Also, the tunnels leading in to lower Manhattan are closed to commercial vehicles. All those vehicles now being rerouted to other parts of the city.

A federal law enforcement source telling CNN that officials right now trying to determine whether the terror operatives are actually in place ready to strike. The intelligence indicating that operatives were conducting surveillance in New York, New Jersey as well as Washington to see reconnaissance. So specific, there are details about meeting rooms, details about parking garages as well as about the locations of security cameras.

The head of the New York Stock Exchange said that everybody is being searched. There are metal detectors in place. And any information that these operatives may have gotten did not come from anybody working at the exchange.

The weapon, of course, of most concern to police here in the city, some sort of a truck bomb or a smaller device perhaps carried in a backpack - Daryn?

KAGAN: Deborah Feyerick in New York City. Deborah, thank you for that. And we are standing by. We expect Mayor Bloomberg to come out and make a statement any minute. And when he does, you'll see those comments here on CNN.

Meanwhile, the mayor of Washington, D.C. says heightened security measures won't be confined to financial institutions. Mayor Anthony Williams and the governors of New York and New Jersey were guests on CNN earlier this morning. They talked about the terror threat and what security measures people could expect.

(BEGIN VIDEO CLIP)

MAYOR ANTHONY WILLIAMS, WASHINGTON, D.C.: Citizens can expect to see some changes in routing from time to time. They can expect some delays if trucks are pulled over for inspection. And certainly they'll see an increased police security presence.

GOV. JIM MCGREEVEY (R), NEW JERSEY: We have our K-9. We have our bomb units out. Also, our state police are on ferries, on trains. And we also automatically implement, every time we go to level orange, certain safety protocols that have been adopted by the financial services industry.

GOV. GEORGE PATAKI (R), NEW YORK: We want people to go about their lives. We want them to live with the freedom and the confidence that they're entitled to have as New Yorkers and as Americans. One of the weapons that terrorists try to use is, in addition to actual terror, is fear. And we can't give into that fear.

(END VIDEO CLIP)

KAGAN: Well Governor Pataki and New York Mayor Michael Bloomberg rang the opening bell at the New York Stock Exchange in show of support. And we had a chance to talk with Governor Pataki in the last hour.

Those new terror warnings appear to have their genesis in Pakistan. Pakistani officials telling CNN that a pair of alleged al Qaeda operatives provided them with details after their arrest.

One suspect is this man you see up on the screen, Ahmed Ghailani. He was wanted in the 1998 East African embassy bombings. The other is said to be a computer expert for al Qaeda, a young man who arranged e- mail and Web postings.

Meanwhile, some Democrats, Howard Dean among them, suggest there might be political motives behind the new terror threat. The Democratic challenger, John Kerry, rejects that in an interview with CNN's Bill Hemmer earlier this morning.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: I believe you take these threats seriously. I take them seriously. I think people of good conscience are working on these issues. I respect the men and women in the threat reduction effort. I respect the people who are in the homeland security department. I don't question them. I question the leadership.

(END VIDEO CLIP)

KAGAN: Kerry says that the Bush team has been dragging its feet on security, as he put it, limping along from one threat to the next.

We will get a different view of that from President Bush when he comes out to speak in about 10, 15 minutes live from the Rose Garden at the White House. You'll see those comments live here on CNN.

Meanwhile, let's get an inside look from a counterterrorism expert, David Heyman, a senior fellow at the Center for Strategic and International Studies in Washington.

David, thank you for being here with us.

DAVID HEYMAN, SENIOR FELLOW, CTR. FOR STRATEGIC & INTL. STUDIES: Good morning.

KAGAN: First, what do you make of this latest round of threats and its targets and the specific information we have about what al Qaeda might have been planning?

HEYMAN: Well, the thing that is significant is how specific and how broad the details are from the documents and the materials they received from multiple sources. I think it's probably a treasure trove of information from intelligence connecting theories about attacks post 9/11 and prior to the election to specific targets. So for the first time we're seeing things like that.

But it is -- it's important for people to recognize, this was targeting information. This was vulnerability assessments. It was not a specific plan of operations, and we do not know of any plan of operations right now. There is no imminent threat. It's specific target information.

KAGAN: And so the question then becomes how long can you live at this high level of threat?

HEYMAN: Well, of course, one of the great challenges post-9/11 is that this is a guessing game. We're a bit in the dark here. We don't know when we've disrupted terrorist attacks or plans. And we don't know necessarily whether there were plans to begin with.

Right now, New York has been at a high level of alert since the Iraq invasion. The financial systems, the financial industry have been, since the World Trade Center, attacks putting in place security plans. Remember the World Trade Center did affect financial systems and we put backups in place.

So, we are doing a tremendous amount right now to make sure that we continue to maintain vigilance on high security.

KAGAN: In about 10 minutes, President Bush is expected to come out to the Rose Garden at the White House and make some announcements about what he plans to do by executive order.

One of those, according to our sources, he will name a national intelligence chief, not the person, but the position. But unlike what's recommended in the 9/11 commission report, he doesn't feel that should be within the White House. What do you think of that idea?

HEYMAN: Well, there's a lot of debate about that. The White House is, in the end, a political office. And you do you not want your intelligence to be beholdened to political operations.

It's a service provision. It provides intelligence to all people in the government and to the executives. And so there's probably some wisdom behind keeping it outside the White House.

As you know, CIA director is outside the White House right now. But we do need to coordinate better across intelligence collection and analysis. We need to improve analysis. And so, I hope that we hear from the president that we will be improving our ability to connect the dots.

KAGAN: One thing that is so chilling about the information coming out of this latest threat is how much information that the terrorists apparently have gathered on these different buildings, on these different targets, security guards, are they armed, security cameras, location, number of people that come and go from these buildings?

But how can you guard against casing and still live in a free society?

HEYMAN: Well, that's what really is what's striking about this. It's as if you were -- discovered -- when you came home that somebody had left an envelope with all of the information about your own house, where your coffee was, where your wallet is, what you do in the morning when you get up.

It's that kind of scariness that people are facing in the security world today because they have that level of detail. We can't protect against surveillance to that level of detail. But what we can do is we do better awareness training. People need to be aware of suspicious activity. We have new heightened security cameras across critical infrastructure. And the combination of heightened awareness and additional surveillance will hopefully lead us to better intelligence.

KAGAN: David Heyman with the Strategic and International Studies Institute in Washington, thank you for that. Appreciate your time.

HEYMAN: Thank you. Thank you.

KAGAN: We're standing by for two important news conferences, one is with Mayor Bloomberg of New York City. He is expected any minute. And in about 10 minutes, we are expecting a news conference out of the Rose Garden with President Bush.

It's about 11:20. You will see both of those live as they begin.

Right now, a good time for a break.

(COMMERCIAL BREAK) DARBY MULLANY, CNN FINANCIAL NEWS CORRESPONDENT: I'm Darby Mullany at the New York Stock Exchange where stocks are under pressure but not showing any major reaction to the terror threats against financial targets in the U.S.

Right now, the Dow industrials are down about 6.5 points.

The Nasdaq composite is falling two-thirds of 1 percent.

Economic news this morning mixed. The manufacturing sector continued to rebound last month, but construction spending dropped unexpectedly in June.

And shares of Cox Communications are soaring more than 20 percent. That's on word that the family that owns most of the nation's fourth-largest cable company wants to buy all of the shares outstanding and take it private for $7.9 billion

That is the very latest from Wall Street.

CNN's LIVE TODAY will be right back.

(COMMERCIAL BREAK)

KAGAN: In Paraguay this morning an intense investigation is under way after a fire and two explosions at a crowded supermarket. Police say they've identified 246 bodies so far and they estimate that another 80 have yet to be identified.

Among the dead, numerous children -- witnesses say that some victims were unable to escape because of locked doors, a charge that the store's owner denies. At least 106 people were hurt. Authorities say a short circuit could have caused the blaze. But they say there's also a chance the fire could have been set intentionally.

Deadly attacks targeting Christians top the news from Iraq this morning. Iraq's national security adviser said today the attacks bear the blue print of terrorist Abu Musab Al-Zarqawi. At least seven people were killed in bombings yesterday that targeted churches in Mosul and Baghdad.

Muslim leaders in Iraq condemn the attacks. They call them an attempt to create more religious strife and drive Christians out of the country.

A Somali truck driver held captive in Iraq may soon be freed. The Arab network Al Jazeera says that militants decided to release him after his employer agreed to stop working in Iraq. In an earlier videotape, the captors threatened to behead the man unless his firm pulled out of the country.

Kidnappers have apparently followed through on their threat to kill a Turkish hostage. Two of them are seen in the earlier videotape. New video posted on the Internet shows a masked gunman firing three bullets into the head of a man identified as a Turk.

In response, a Turkish truckers' association said today it would stop delivering goods to U.S. troops in Iraq.

An American Marine who says he was held hostage in Iraq is back with his family in Utah this morning. Wassef Ali Hassoun asked for prayers for the remaining hostages.

A videotape of Hassoun surfaced in June showing him blindfolded. At one point reports indicated had he been beheaded. But he turned up in Lebanon, where he was born and where he still has relatives. A Naval criminal investigation unit has been looking into Hassoun's disappearance. He denies that he was a deserter.

Bracing for impact? Well, not quite. But folks on the Carolina coast are still keeping a close eye on a storm named Alex.

And we're still keeping a close eye on the heightened terror alert.

Coming up, we'll hear from the White House and from homeland security secretary, Tom Ridge.

(COMMERCIAL BREAK)

KAGAN: We're standing by for two news conferences. President Bush any minute is suppose to be coming out in the Rose Garden. We'll see those comments live.

Also Mayor Bloomberg will speak to New York City. He is also suppose to hold a news conference. We will do our best to bring both to you live right here on CNN.

Some other news meanwhile for you, swimmers along the Carolina coast should be careful of the currents. That warning after the first tropical storm of the season gathered strength before drifting eastward.

It's not expected to become a hurricane. Forecasters say that tropical storm Alex and its winds have topped 60 miles an hour, prompting tropical storm warnings from the South Santee River to Cape Hatteras, North Carolina.

Experts say that rip currents are possible but no coastal flooding is expected.

Well, for more on the weather picture, let's check in with Jacqui Jeras. Hi, Jacqui.

JACQUI JERAS, CNN METEOROLOGIST: Hey, Daryn. Careful what you say about not expected to become a hurricane.

KAGAN: Really?

JERAS: Well, right now it's not, but it looks like it is going to be still strengthening for a good 12 to 24 hours. And that means the potential is there for this to become a very strong tropical storm, possibly a minimal hurricane. Right now, official forecast has it just under hurricane strength. (WEATHER BREAK)

KAGAN: All right, Jacqui, a big day for you -- a lot to follow. We'll be checking back with you.

JERAS: OK.

KAGAN: We're also staying on top of the situation in New York, northern New Jersey and also Washington, D.C. The financial districts for those areas are now under very heavy security and a high terror alert.

Up next, we hear from homeland security director - secretary -- Tom Ridge.

We're also standing by for a news conference to begin with President Bush, so stay with us for all that.

(COMMERCIAL BREAK)

KAGAN: I'm Daryn Kagan at CNN Center in Atlanta.

Let's check what's happening now in the news for this Monday, August 2nd.

Financial centers in three cities are on heightened terror alert today. Administration officials point to new detailed intelligence indicating al Qaeda wants to strike New York, Washington and Newark.

The World Bank and Citigroup building are also among the potential targets.

President Bush is set to endorse some of the 9/11 commission's recommendations today. He'll go along with a national intelligence director, but he doesn't believe he should have the office centered in the White House, as the commission wanted.

We're standing by for a news conference to begin from the White House Rose Garden. And you will see it live here on CNN.

And Mary Kay Letourneau, the teacher who had two children with her 6th grade student is scheduled to be released from prison this week. She began an affair with the boy when he was 12. He is now 21.

Keeping you informed, CNN, the most trusted name in news.

They are symbols of American prosperity, now officials say they are also potential terrorist targets. Locations in New York, New Jersey and Washington are on heightened alert following the latest terror threat. It warns of a possible al Qaeda attack targeting financial sectors.

Homeland Security Secretary Tom Ridge called the intelligence that prompted the new terror warnings alarming. Earlier on CNN's "AMERICAN MORNING," Ridge talked about the information that his agency has received. (BEGIN VIDEO CLIP)

TOM RIDGE, HOMELAND SECURITY SECRETARY: The rationale behind focusing on the financial sector is really based on the analysis of all the information we've uncovered in the past and analyzed over the past 24-48 hours. The specific targeting of the buildings that we identified yesterday showed clearly an interest in trying to affect, in their jaded minds, the jaded minds of the terrorists, somehow influence the economy, undermine the economy of United States.

(END VIDEO CLIP)

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Aired August 2, 2004 - 11:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
DARYN KAGAN, CNN ANCHOR: American on alert. Three cities begin the workweek with a specific and detailed terror threat. For New York City, Washington and Newark, New Jersey, it is far from business as usual this morning.
Officials say that al Qaeda could target five financial centers, the International Monetary Fund and the World Bank in Washington, Prudential Financial in Newark, Citigroup in New York City and the New York Stock Exchange as well.

Some of the specifics in the new terror alert according to the Associated Press, al Qaeda, it says, has been tracking the flow of pedestrians outside one building apparently to determine how many people could be killed in a single attack.

The quality of explosive materials, whether they could get hot enough to melt the steel underpinnings of a building. Specifics on building reconnaissance, how structures could be quietly observed. And the locations of police and fire stations, schools and hospitals near specific targets.

Sean Callebs is covering the developments in homeland security this morning. He joins us from World Bank headquarters in Washington, D.C.

Sean, good morning.

SEAN CALLEBS, CNN CORRESPONDENT: Good morning, Daryn.

Indeed, the World Bank and IMF buildings behind me getting a great deal of attention today. Employees who showed up for work this morning noticed some somewhat drastic security changes.

There are security guards outside now checking IDs before employees even get inside the door, more security guards on the other side of the building, also an added presence of D.C. police in this area as well.

They have been randomly stopping trucks throughout the day just making checks to see what it is inside. No problems reported at this point.

The IMF and World Bank buildings are also located on a busy intersection here in downtown Washington, a great deal of traffic, both pedestrian and vehicles. And it's also -- we have a map here showing you -- only a couple of blocks from the White House. Now, later on this afternoon, World Bank president James Wolfenson, who was on vacation when he found out about these security warnings, and came back to D.C. last night and had security meetings with department of homeland security as well as IMF officials.

Now, he is going to hold a meeting with the several thousand World Bank employees who work here, a town hall gathering, if you will. It's an effort to try and allay concerns.

Now, throughout the day we have had a chance to speak to some employees as they make their way in and out of the building. And they maintain it is going to be business as usual, almost.

(BEGIN VIDEO CLIP)

UNIDENTIFIED WASHINGTON, D.C. RESIDENT: I was worried, obviously, but I trust the system that the government set up -- the alert system.

UNIDENTIFIED WASHINGTON, D.C. RESIDENT: I have a job to do and I'm not going to let somebody I don't know where they are and what they're doing stop me from doing my job.

UNIDENTIFIED WASHINGTON, D.C. RESIDENT: They are in constant contact with the authorities and FBI and that if they learn something more, action will be taken. As of now, we're open for regular business.

(END VIDEO CLIP)

CALLEBS: When asked how the employees here are faring, a spokesman for the World Bank said, he wouldn't be telling the truth if he said that there weren't some nerves that were rattled.

And there has been some detailed information that Daryn went through just a moment ago, that secretary of homeland -- homeland security chief -- Tom Ridge spelled out yesterday.

Now, we know the World Bank has been in close contact with the deputy director of homeland security last night, also talking with IMF officials as well. D.C. police also say that they are going to make an increased presence in this area.

One thing they have said, they don't want to put up barricades in this area. They want to keep this area open. And also the D.C. mayor yesterday making a move that homeland security did not, D.C. is elevating security in this entire city, not just to the financial institutions -- Daryn?

KAGAN: And it still is the busy summer tour season there in Washington, D.C. For folks who are planning on visiting the nation's capital, most things still open?

CALLEBS: Most things open. I think that's one thing that the mayor came out and said last night, the police chief came out and said last night, if you're going to shop, if you're going to visit, if you're going to have friends out, if you're going to go out and do things, don't alter your schedule.

They really believe that they have enough coordination among agencies and with that detailed information that homeland security has, they are doing everything they can to make this city as safe as possible.

KAGAN: Sean Callebs in the nation's capital. Sean, thank you for that.

From there, let's go to the nation's financial capital. Anxious workers in New York's financial district had to make their way through new barriers and more police this morning. That's where we find our Deborah Feyerick. She is outside the New York Stock Exchange with more on the new terror threat.

Deb, good morning.

DEBORAH FEYERICK, CNN CORRESPONDENT: Good morning, Daryn.

Well the traders came to work this morning a bit more tense but ready to start the day. Many of them were here on 9/11, just blocks from the World Trade Center. They say that this kind of uncertainty has simply become a way of life.

Now, the New York City mayor was also here sending a very, strong message that the city is open, that business will go on, that whatever threats might be out there, not enough to shut the city down.

Trucks are being searched in and around Wall Street. Also, the tunnels leading in to lower Manhattan are closed to commercial vehicles. All those vehicles now being rerouted to other parts of the city.

A federal law enforcement source telling CNN that officials right now trying to determine whether the terror operatives are actually in place ready to strike. The intelligence indicating that operatives were conducting surveillance in New York, New Jersey as well as Washington to see reconnaissance. So specific, there are details about meeting rooms, details about parking garages as well as about the locations of security cameras.

The head of the New York Stock Exchange said that everybody is being searched. There are metal detectors in place. And any information that these operatives may have gotten did not come from anybody working at the exchange.

The weapon, of course, of most concern to police here in the city, some sort of a truck bomb or a smaller device perhaps carried in a backpack - Daryn?

KAGAN: Deborah Feyerick in New York City. Deborah, thank you for that. And we are standing by. We expect Mayor Bloomberg to come out and make a statement any minute. And when he does, you'll see those comments here on CNN.

Meanwhile, the mayor of Washington, D.C. says heightened security measures won't be confined to financial institutions. Mayor Anthony Williams and the governors of New York and New Jersey were guests on CNN earlier this morning. They talked about the terror threat and what security measures people could expect.

(BEGIN VIDEO CLIP)

MAYOR ANTHONY WILLIAMS, WASHINGTON, D.C.: Citizens can expect to see some changes in routing from time to time. They can expect some delays if trucks are pulled over for inspection. And certainly they'll see an increased police security presence.

GOV. JIM MCGREEVEY (R), NEW JERSEY: We have our K-9. We have our bomb units out. Also, our state police are on ferries, on trains. And we also automatically implement, every time we go to level orange, certain safety protocols that have been adopted by the financial services industry.

GOV. GEORGE PATAKI (R), NEW YORK: We want people to go about their lives. We want them to live with the freedom and the confidence that they're entitled to have as New Yorkers and as Americans. One of the weapons that terrorists try to use is, in addition to actual terror, is fear. And we can't give into that fear.

(END VIDEO CLIP)

KAGAN: Well Governor Pataki and New York Mayor Michael Bloomberg rang the opening bell at the New York Stock Exchange in show of support. And we had a chance to talk with Governor Pataki in the last hour.

Those new terror warnings appear to have their genesis in Pakistan. Pakistani officials telling CNN that a pair of alleged al Qaeda operatives provided them with details after their arrest.

One suspect is this man you see up on the screen, Ahmed Ghailani. He was wanted in the 1998 East African embassy bombings. The other is said to be a computer expert for al Qaeda, a young man who arranged e- mail and Web postings.

Meanwhile, some Democrats, Howard Dean among them, suggest there might be political motives behind the new terror threat. The Democratic challenger, John Kerry, rejects that in an interview with CNN's Bill Hemmer earlier this morning.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: I believe you take these threats seriously. I take them seriously. I think people of good conscience are working on these issues. I respect the men and women in the threat reduction effort. I respect the people who are in the homeland security department. I don't question them. I question the leadership.

(END VIDEO CLIP)

KAGAN: Kerry says that the Bush team has been dragging its feet on security, as he put it, limping along from one threat to the next.

We will get a different view of that from President Bush when he comes out to speak in about 10, 15 minutes live from the Rose Garden at the White House. You'll see those comments live here on CNN.

Meanwhile, let's get an inside look from a counterterrorism expert, David Heyman, a senior fellow at the Center for Strategic and International Studies in Washington.

David, thank you for being here with us.

DAVID HEYMAN, SENIOR FELLOW, CTR. FOR STRATEGIC & INTL. STUDIES: Good morning.

KAGAN: First, what do you make of this latest round of threats and its targets and the specific information we have about what al Qaeda might have been planning?

HEYMAN: Well, the thing that is significant is how specific and how broad the details are from the documents and the materials they received from multiple sources. I think it's probably a treasure trove of information from intelligence connecting theories about attacks post 9/11 and prior to the election to specific targets. So for the first time we're seeing things like that.

But it is -- it's important for people to recognize, this was targeting information. This was vulnerability assessments. It was not a specific plan of operations, and we do not know of any plan of operations right now. There is no imminent threat. It's specific target information.

KAGAN: And so the question then becomes how long can you live at this high level of threat?

HEYMAN: Well, of course, one of the great challenges post-9/11 is that this is a guessing game. We're a bit in the dark here. We don't know when we've disrupted terrorist attacks or plans. And we don't know necessarily whether there were plans to begin with.

Right now, New York has been at a high level of alert since the Iraq invasion. The financial systems, the financial industry have been, since the World Trade Center, attacks putting in place security plans. Remember the World Trade Center did affect financial systems and we put backups in place.

So, we are doing a tremendous amount right now to make sure that we continue to maintain vigilance on high security.

KAGAN: In about 10 minutes, President Bush is expected to come out to the Rose Garden at the White House and make some announcements about what he plans to do by executive order.

One of those, according to our sources, he will name a national intelligence chief, not the person, but the position. But unlike what's recommended in the 9/11 commission report, he doesn't feel that should be within the White House. What do you think of that idea?

HEYMAN: Well, there's a lot of debate about that. The White House is, in the end, a political office. And you do you not want your intelligence to be beholdened to political operations.

It's a service provision. It provides intelligence to all people in the government and to the executives. And so there's probably some wisdom behind keeping it outside the White House.

As you know, CIA director is outside the White House right now. But we do need to coordinate better across intelligence collection and analysis. We need to improve analysis. And so, I hope that we hear from the president that we will be improving our ability to connect the dots.

KAGAN: One thing that is so chilling about the information coming out of this latest threat is how much information that the terrorists apparently have gathered on these different buildings, on these different targets, security guards, are they armed, security cameras, location, number of people that come and go from these buildings?

But how can you guard against casing and still live in a free society?

HEYMAN: Well, that's what really is what's striking about this. It's as if you were -- discovered -- when you came home that somebody had left an envelope with all of the information about your own house, where your coffee was, where your wallet is, what you do in the morning when you get up.

It's that kind of scariness that people are facing in the security world today because they have that level of detail. We can't protect against surveillance to that level of detail. But what we can do is we do better awareness training. People need to be aware of suspicious activity. We have new heightened security cameras across critical infrastructure. And the combination of heightened awareness and additional surveillance will hopefully lead us to better intelligence.

KAGAN: David Heyman with the Strategic and International Studies Institute in Washington, thank you for that. Appreciate your time.

HEYMAN: Thank you. Thank you.

KAGAN: We're standing by for two important news conferences, one is with Mayor Bloomberg of New York City. He is expected any minute. And in about 10 minutes, we are expecting a news conference out of the Rose Garden with President Bush.

It's about 11:20. You will see both of those live as they begin.

Right now, a good time for a break.

(COMMERCIAL BREAK) DARBY MULLANY, CNN FINANCIAL NEWS CORRESPONDENT: I'm Darby Mullany at the New York Stock Exchange where stocks are under pressure but not showing any major reaction to the terror threats against financial targets in the U.S.

Right now, the Dow industrials are down about 6.5 points.

The Nasdaq composite is falling two-thirds of 1 percent.

Economic news this morning mixed. The manufacturing sector continued to rebound last month, but construction spending dropped unexpectedly in June.

And shares of Cox Communications are soaring more than 20 percent. That's on word that the family that owns most of the nation's fourth-largest cable company wants to buy all of the shares outstanding and take it private for $7.9 billion

That is the very latest from Wall Street.

CNN's LIVE TODAY will be right back.

(COMMERCIAL BREAK)

KAGAN: In Paraguay this morning an intense investigation is under way after a fire and two explosions at a crowded supermarket. Police say they've identified 246 bodies so far and they estimate that another 80 have yet to be identified.

Among the dead, numerous children -- witnesses say that some victims were unable to escape because of locked doors, a charge that the store's owner denies. At least 106 people were hurt. Authorities say a short circuit could have caused the blaze. But they say there's also a chance the fire could have been set intentionally.

Deadly attacks targeting Christians top the news from Iraq this morning. Iraq's national security adviser said today the attacks bear the blue print of terrorist Abu Musab Al-Zarqawi. At least seven people were killed in bombings yesterday that targeted churches in Mosul and Baghdad.

Muslim leaders in Iraq condemn the attacks. They call them an attempt to create more religious strife and drive Christians out of the country.

A Somali truck driver held captive in Iraq may soon be freed. The Arab network Al Jazeera says that militants decided to release him after his employer agreed to stop working in Iraq. In an earlier videotape, the captors threatened to behead the man unless his firm pulled out of the country.

Kidnappers have apparently followed through on their threat to kill a Turkish hostage. Two of them are seen in the earlier videotape. New video posted on the Internet shows a masked gunman firing three bullets into the head of a man identified as a Turk.

In response, a Turkish truckers' association said today it would stop delivering goods to U.S. troops in Iraq.

An American Marine who says he was held hostage in Iraq is back with his family in Utah this morning. Wassef Ali Hassoun asked for prayers for the remaining hostages.

A videotape of Hassoun surfaced in June showing him blindfolded. At one point reports indicated had he been beheaded. But he turned up in Lebanon, where he was born and where he still has relatives. A Naval criminal investigation unit has been looking into Hassoun's disappearance. He denies that he was a deserter.

Bracing for impact? Well, not quite. But folks on the Carolina coast are still keeping a close eye on a storm named Alex.

And we're still keeping a close eye on the heightened terror alert.

Coming up, we'll hear from the White House and from homeland security secretary, Tom Ridge.

(COMMERCIAL BREAK)

KAGAN: We're standing by for two news conferences. President Bush any minute is suppose to be coming out in the Rose Garden. We'll see those comments live.

Also Mayor Bloomberg will speak to New York City. He is also suppose to hold a news conference. We will do our best to bring both to you live right here on CNN.

Some other news meanwhile for you, swimmers along the Carolina coast should be careful of the currents. That warning after the first tropical storm of the season gathered strength before drifting eastward.

It's not expected to become a hurricane. Forecasters say that tropical storm Alex and its winds have topped 60 miles an hour, prompting tropical storm warnings from the South Santee River to Cape Hatteras, North Carolina.

Experts say that rip currents are possible but no coastal flooding is expected.

Well, for more on the weather picture, let's check in with Jacqui Jeras. Hi, Jacqui.

JACQUI JERAS, CNN METEOROLOGIST: Hey, Daryn. Careful what you say about not expected to become a hurricane.

KAGAN: Really?

JERAS: Well, right now it's not, but it looks like it is going to be still strengthening for a good 12 to 24 hours. And that means the potential is there for this to become a very strong tropical storm, possibly a minimal hurricane. Right now, official forecast has it just under hurricane strength. (WEATHER BREAK)

KAGAN: All right, Jacqui, a big day for you -- a lot to follow. We'll be checking back with you.

JERAS: OK.

KAGAN: We're also staying on top of the situation in New York, northern New Jersey and also Washington, D.C. The financial districts for those areas are now under very heavy security and a high terror alert.

Up next, we hear from homeland security director - secretary -- Tom Ridge.

We're also standing by for a news conference to begin with President Bush, so stay with us for all that.

(COMMERCIAL BREAK)

KAGAN: I'm Daryn Kagan at CNN Center in Atlanta.

Let's check what's happening now in the news for this Monday, August 2nd.

Financial centers in three cities are on heightened terror alert today. Administration officials point to new detailed intelligence indicating al Qaeda wants to strike New York, Washington and Newark.

The World Bank and Citigroup building are also among the potential targets.

President Bush is set to endorse some of the 9/11 commission's recommendations today. He'll go along with a national intelligence director, but he doesn't believe he should have the office centered in the White House, as the commission wanted.

We're standing by for a news conference to begin from the White House Rose Garden. And you will see it live here on CNN.

And Mary Kay Letourneau, the teacher who had two children with her 6th grade student is scheduled to be released from prison this week. She began an affair with the boy when he was 12. He is now 21.

Keeping you informed, CNN, the most trusted name in news.

They are symbols of American prosperity, now officials say they are also potential terrorist targets. Locations in New York, New Jersey and Washington are on heightened alert following the latest terror threat. It warns of a possible al Qaeda attack targeting financial sectors.

Homeland Security Secretary Tom Ridge called the intelligence that prompted the new terror warnings alarming. Earlier on CNN's "AMERICAN MORNING," Ridge talked about the information that his agency has received. (BEGIN VIDEO CLIP)

TOM RIDGE, HOMELAND SECURITY SECRETARY: The rationale behind focusing on the financial sector is really based on the analysis of all the information we've uncovered in the past and analyzed over the past 24-48 hours. The specific targeting of the buildings that we identified yesterday showed clearly an interest in trying to affect, in their jaded minds, the jaded minds of the terrorists, somehow influence the economy, undermine the economy of United States.

(END VIDEO CLIP)

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