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American Morning
Brutal Day for the Markets; Markets Across The Globe Hammered; Global Markets Hammered; Twin Blasts Hit British Council; U.N. Mission Headed To Syria; Stage Collapse in Belgium; Sugarland Takes The Stage; While the President's Away; Stealth Fleet Grounded; Interview with Bruce Bartlett, Former Treasury Official; The New Harlem Street Game; "Speedo" Suit; Hazare Leaves New Delhi Jail; Papal Visits Triggers Protests In Spain
Aired August 19, 2011 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: You're right, it's Friday. AMERICAN MORNING continues right now.
CHRISTINE ROMANS, CNN ANCHOR: Carol, a brutal day already for the markets. I'm Christine Romans. Investors now are heading for the exits in Europe and Asia after yesterday's sharp slide on Wall Street. Are we nearing a second recession or are there still signs of hope?
COSTELLO: Mr. President, want to get away? I'm Carol Costello. As President Obama begins a 10-day vacation Republicans go on the attack saying a time of economy of high anxiety is not the time for and R and R on this AMERICAN MORNING.
ROMANS: Good morning. It's Friday, August 19th. And welcome to AMERICAN MORNING. Carol, good morning. You said something interesting, I don't feel like there's anything I can do about the markets, but what a lot of people are doing, they're trying to refinance.
Because mortgage rates are at record lows and they're noticing how cheap interest rates are and they're trying to figure out is there a way that I can shave some money off my monthly bill. That's really the only thing people can feel like they can have control over now, if you can get through to the bankers.
COSTELLO: If you can get through to the bankers because we're trying and it's not cheap to refinance.
ROMANS: That's right.
COSTELLO: So you have really to think about whether you really want to do that.
ROMANS: Yes, but if rates go low enough, it's good to check it out.
COSTELLO: It's Friday. ROMANS: Yes.
COSTELLO: Yes. Although the week started off well, the realization that a second recession may be drawing closer is just hammering stocks this morning actually futures.
Here in the United States, the Dow dropped 420 points or nearly 4 percent yesterday, stripping away this week's gains and then some adding to the uncertainty, bad news on manufacturing, inflation and jobs.
ROMANS: Jobs, which we know are scarce, this video says it all. Thousands of Americans waiting for hours in sweltering heat just hoping to land an interview at a job fair in Atlanta and because the economy is truly global, the anxiety here is spreading. Our Nina Dos Santos is live in London. Nina, how are the markets overseas so far?
NINA DOS SANTOS, CNN INTERNATIONAL CORRESPONDENT: I'm afraid to say it's not looking good on the final trading day of the week. It's turned into another volatile session for stock markets around the world. The stock markets in Asia ended the day lower and what we're seeing at the moment in Europe is the markets down to the tune of 1.5 percent to 2 percent.
Earlier today, they were falling in excess of 3 percent. That adds to declines of more than 5 percent yesterday. Now, if you take a look at what's happening in the markets, investors are telling us they're becoming increasingly concerned about a slowdown of global growth that could, indeed, indicate we could be heading towards another recession.
So there are fears of a dreaded double dip very much playing on investors' minds at the moment. If you take a look at the year-to- date for some of the markets, it seems as though Europe has fared considerably worse in the markets than where you to are at the Dow Jones Industrial average only is just down 5 percent even if you count yesterday's declines.. Markets here in Europe down in excess of 20 percent.
ROMANS: All right, Nina Dos Santos, we'll see if it spreads here again today.
Meanwhile, developing news out of Afghanistan this morning. The Taliban claiming responsibility for two explosions that rocked the British Council in downtown Kabul. At least eight people were killed in the attack. Apparently began with a car bomb outside the main security gates. Heavy gunfire, even more explosions were heard hours after the attack.
A U.N. humanitarian mission is on its way to Syria to see how far the regime of President Bashar Al Assad has gone to snuff out anti-government protests. A scathing new U.N. report claims Syria is torturing and murdering its own people. U.S. and European leaders continue to call on Assad to step down.
COSTELLO: It has happened again. Another stage collapse at a concert, this time in Belgium. Take a look, a fierce storm ripped through an annual open air music festival in the city of Pasal. Heavy winds collapsing the stage, leaving its roof off, equipment dangling in the air and concertgoers running for their lives. Five people killed here, more than 50 others hurt.
COSTELLO: Sugarland performing for the first time since a deadly stage collapse in the United States at the Indiana State Fair. Five people died in last weekend's tragedy. The country do paid tribute when they took to the stage last night in Albuquerque.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: In honor of those people who were wounded and those beautiful lives that were lost, we ask you to stand and join us now in a moment of silence.
(END VIDEO CLIP)
COSTELLO: Sugarland plans to return to Indiana for a memorial service later this year.
ROMANS: Following developments this year in the case of the so- called West Memphis Three. A source close to the case telling CNN's David Mattingly, convicted child killers could go free after a court hearing today.
Damien Echols, Jesse Miskelley and Jason Baldwin have spent the past 18 years behind bars for the murders of three Arkansas cub scouts. The case has drawn national attention with supporters including numerous celebrities claiming the men were wrongly convicted. The men have always maintained their innocence.
COSTELLO: A father and son from Pennsylvania behind bars this morning accused of conducting a month-long campaign to threaten Sarah Palin and her family.
Craig and Shawn Christy have been indicted by an Alaska grand jury. They allegedly ignored a restraining order and called Palin's lawyer 400 times leaving threats about deadly and sexual attacks on the former governor and her children.
ROMANS: If you're the president, there's probably never a good time to get away, just as President Obama arrived on Martha's Vineyard for a ten-day family vacation the stock market took a dive. It's giving Republicans a new opening to blast the president's handling of the economy and the timing of his R and R.
Our CNN Deputy political director Paul Steinhauser is live in Washington. I can remember a lot of grabbling about the Crawford Ranch and now we've just changed Crawford Ranch to grumbling about the president in Martha's Vineyard. I will say the economy pretty much stinks. Everyone really does want to know what he's going to do about jobs.
PAUL STEINHAUSER, CNN DEPUTY POLITICAL DIRECTOR: Absolutely. When President Bush was in office, he was spending too much time at Crawford when the wars in Afghanistan were raging, same thing with Bill Clinton when he was in the White House back in the 1990s, Christine. Presidents get blamed. It's an election year almost, the campaign under way.
And Republican presidential candidates that's part of their job to criticize the president that's why they're out there, one of the reasons. They didn't even wait for the president to head yesterday to Martha's Vineyard.
Say, for example, Mitt Romney twice this week, earlier this week he criticized the president for the vacation. Take a listen.
(BEGIN VIDEO CLIP)
MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: The president this week is in three states on a bus tour campaigning and then he's going to be going on a vacation to Martha's Vineyard for 10 days. A lot of Democrats in Martha's Vineyard, I don't know why. But I wish the president were in Washington, calling back Congress, and dealing with the challenges we have.
(END VIDEO CLIP)
STEINHAUSER: A couple things there, Martha's Vineyard in Massachusetts, Mitt Romney's home state. He was talking about Bill Clinton. Bill Clinton also another Democratic president used to vacation there in the summers back in the 90s.
And also guess where Mitt Romney, Christine, will be a week from now, most likely in Martha's Vineyard to raise campaign cash. One other thing, the president's approval rating pretty low right now, but what's lower Congress and there's a lot of criticism as well that Congress is on vacation right now, why are they not back in Washington as well working to create jobs. Christine --
ROMANS: Paul, on that note then, you know, the RNC releasing some postcards that mock the president's vacation. I guess hoping that people are going to, you know, download them and virally e-mail them all over the place. Tell me about that.
STEINHAUSER: Yes. Check this out from the Republican National Committee. This is a party committee, one of their jobs to attack the president of the other party. Look right here, go to their web site, you can download these postcards, send them to friends and pretty humorous, I guess, and also you can donate to the RNC.
The DNC, Democratic National Committee is doing the same thing on the other side. Check this out, they're going after Mitt Romney. Remember his comments about a week ago, corporations are people too. You can buy one of those t-shirts and donate $30 to the Democratic National Committee. That's politics, that's what I cover, keeps me I guess employed.
COSTELLO: That's one job you personally do care about.
STEINHAUSER: Yes, I guess so. ROMANS: Paul Steinhauser, thanks.
Coming up at 8:10 Eastern, we're going to talk with RNC Chairman Reince Friebus about their new line of attack on the president, Carol.
COSTELLO: Yes and maybe he can share with you the Republican's jobs plan.
ROMANS: It's postcards. I know it's postcards.
COSTELLO: Now is your chance to talk back within one of the big stories of the day. The question this morning is President Obama neglecting the black community. Congresswoman Maxine Waters says yes.
(BEGIN VIDEO CLIP)
REP. MAXINE WATERS (D), CALIFORNIA: He went with a plan and that plan was to invest money in those rural communities in order to develop jobs. We like that. We want the rural poor to be attended to. But we also want the urban poor to be attended to.
(END VIDEO CLIP)
COSTELLO: It is true. President Obama did not visit majority black communities on his three-day bus tour. In the meantime, the Congressional Black Caucus is organizing job fairs for African- Americans across the country.
But just because President Obama isn't present at those job fairs, doesn't mean he doesn't care. It's just that well, he's got the black vote and while he doesn't need a majority of white votes to win re-election, he does need some.
According to exit polls, President Obama won 43 percent of the white vote in 2008, which is pretty good for a Democrat. Still, there are ominous signs for the president. According to the latest CNN/ORC poll, just 34 percent of whites approve of how the president is doing his job.
Some African-American leaders say so what. Democrats haven't won a majority of white votes since 1964. Mr. Obama should at least show some love to his most loyal constituency. The 95 percent of African-American voters cast ballots for the president in 2008 although that was only 13 percent of the entire vote.
And since then, the unemployment rate for black America has risen to 15.9 percent. Where, they ask, is their Obama bus tour? The talk back question this morning, is president Obama neglecting the black community? Facebook.com/americanmorning. Facebook.com/americanmorning. I'll read your responses later this hour.
ROMANS: All right, coming up on AMERICAN MORNING, the government spending billions to build stealth fighter jets, but now some people are calling for the fleet to be grounded for good. COSTELLO: A goodwill game goes bad between George Town University and China. This happened in China. Chairs were tossed, punches thrown. We've got the pictures and the State Department's reaction.
ROMANS: And baseball-sized hail, 100-mile-an-hour winds inflicting a lot of hurt on one mid-western town. Can you imagine walking out and seeing that on your car? You're watching AMERICAN MORNING.
(COMMERCIAL BREAK)
ROMANS: The Pentagon calls its most expensive weapons program ever pouring billions of dollars into the construction of stealth fighter jets, but the fleet's been plagued by mechanical problems, never gone to war. So the big question now is, is it time to cut our losses?
Barbara Starr joins us live from the Pentagon. Good morning, Barbara.
BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, good morning, Christine. You know, Defense Secretary Leon Panetta has got to cut defense spending. There's just no way around it. So could these expensive aircraft programs that already have problems, be the place that he starts doing that?
(BEGIN VIDEO CLIP)
STARR: It's the most expensive weapons program ever, says the Pentagon, $384 billion earmarked for some 3,000 F-35 stealth fighter jets. Testing is resuming after a two-week halt when electrical problems emerged. Then there's the F-22 Air Force stealth fighter at more than $140 million per plane. The nearly 200 plane fleet has been grounded since May after oxygen to the pilots kept cutting off. One pilot died.
With a half trillion dollar price tag for both aircraft -
ANDREW KREPINEVICH, CENTER FOR STRATEGIC AND BUDGETARY ASSESSMENT: The question is, are you really getting the kind of combat capability that justifies that cost?
SEN. JOHN MCCAIN (R), ARIZONA: We cannot afford aircraft that double and triple the original estimated cost.
UNIDENTIFIED MALE: I think we have to watch it very carefully.
STARR: The F-22 has never been in combat, the F-35 may go the same way. Both planes have serious limitations.
KREPINEVICH: These aircraft are relatively short range, which means they have to be based fairly close to the area of conflict. What we've seen in recent years are countries like China, countries like Iran building ballistic missile forces that can easily target the forward air bases. STARR: Winslow Wheeler, a Pentagon spending critics says the planes are too expensive and not stealthy enough.
WINSLOW WHEELER, DIRECTOR, STRAUS MILITARY REFORM PROJECT: Against some radars, it's - it's detectable as soon as it comes over the radar horizon and some of the radars that are best at doing that are quite antiquated technology from the Soviets.
(END VIDEOTAPE)
STARR: So, half a trillion dollars in aircraft that are, to say the least, problematic. You - this fall, you know, look for all the major defense contractors, the Lockheed Martins, the General Dynamics, the Northrop's to really line up in Washington and try and preserve their programs. This is just one example of some of the very expensive programs that could be on the chopping block when Congress really sits down and tries to address defense spending cuts.
ROMANS: You know, Barbara, what's so - what's so frustrating about it is, where is the accountability with those defense contractors who have, obviously, made millions and maybe billions of dollars on some of these programs if you're talking about the numbers that have already been spent, I mean, why don't these things work?
STARR: Well, you know, these two aircraft in particular, let's take the F-35, the one that isn't even built yet and is - and is running up quite a chunk of change, these are incredibly complex systems that the Military has ordered up. Think of it as a flying computer, really, a flying super computer, up in the sky in a combat zone dropping weapons, trying to evade other aircraft, evade missiles. There is probably nothing more complex than this.
And a lot of people say, hey, just go use the standard planes that the military's been using for years. The F-18s, the F-16s, less complex, they work well. But the military will tell you they need the new planes for future threats. It's a huge debate which way to go. And, you know, I think this fall is really going to be decision time -
ROMANS: Yes.
STARR: -- about whether to move ahead.
ROMANS: All right, Barbara Starr. Thank you so much, Barbara.
COSTELLO: There is no (INAUDIBLE) in sports. In China, what started as a goodwill basketball game between that country and Georgetown University quickly deteriorated into a wild brawl.
This game took place in China. The fight broke out with about nine minutes left in the game. Punches were thrown and chairs were tossed. Spectators hurled bottles at the Hoyas players as they left for their locker room. Both the State Department and the Chinese Embassy called the fight unfortunate.
ROMANS: I would call it unfortunate. Coming, as Joe Biden is in China talking about, you know, mutual understanding of the two countries, et cetera, et cetera, metaphor for something that I don't know what.
Yes. They're reeling this morning in Omaha after back-to-back hail storms shut down the airport, even injured a pilot. Forget about the golf ball-sized hail, it looks like someone took a nine iron to these windshields. The cars parked at the Eppley Airfield couldn't stand up to the three-inch hail and winds near 100 miles per hour. Hundreds of air travelers were stranded by that storm.
Can you imagine coming back with your family after being away, getting off your plane, and then - voila.
COSTELLO: Oh, I'd be so angry.
ROMANS: Rob, oh, that's a call to the insurance man right away.
ROB MARCIANO, AMS METEOROLOGIST: Yes. The - you know, you have to replace the glass. I think they come right out to your - to the parking lot and they'll take care of you. I'm sure. They're the ones who are happy about it.
Guys, that thunderstorm complex is still holding together, passed through Kansas City late last night and now moving southeast across Missouri towards the boot hills south of St. Louis and heading towards Cape Girardeau. So this has got some gusty winds, obviously has some hail. It's got a history of doing some serious damage.
We've got several areas of kind of unsettled weather to the northeast being one of them and also yesterday, we had some stormy weather across parts of Arizona.
Video from you for - for you, and Ali it's one of his favorite type of storms, a haboob, a dust storm. He's not here to enjoy it. But, Phoenix yesterday, after setting a record high of 112 degrees, had a thunderstorm pass through to cool things off rapidly. That record broken back in 2007. Wichita Falls also seeing a record. Fort Polk and Lafayette and Houston at Hobby Airport seeing a record as well.
Tropical depression number eight, just north and east of Honduras. It's heading off towards the west, skim the Honduras coastline and get into Belize later on tonight and tomorrow. This is the forecast track. It might become a tropical storm. That is about it. It will have some heavy rains and it will stay south of drought- stricken Texas.
Next item up for tropical consideration is this thing and this thing has more promise, guys. It will likely become a tropical storm in some point the next two or three days and it's heading towards the Caribbean, potentially towards the U.S. by the end of next week.
We'll be watching that one. And that hailstorm, hopefully the hail - the hailstone is getting a little bit smaller this morning, but still a potent storm moving across Southeast Missouri.
Guy, back up to you.
COSTELLO: Oh, so watch out.
Coming up next on AMERICAN MORNING, Hewlett-Packard pulling the plug on PCs and its brand new tablet. So what's next for the computer maker? We're "Minding Your Business."
ROMANS: And a Michigan man doing his best Fred Flintstone imitation to stop a pick-up truck with no brakes? Are you kidding me? Yes. The dash cam video of that coming up right after this. Whoa.
(COMMERCIAL BREAK)
ROMANS: "Minding Your Business" this morning.
U.S. stock futures trading lower ahead of today's open. Dow futures are down more than 150 points right now, that as markets in Asia closed broadly lower and European stocks right now are also trading in the red.
That has gold rallying to a record high, now above $1,850 an ounce. You know that's being called the so-called flight to safety. Of course, investors taking their money out of the stock market, planting it in gold and other precious metals instead.
Bank of America reportedly set to slash thousands of jobs. According to published reports 3,500 people will be let go by the end of next month as part of a restructuring plan. The bank has been struggling to work through a slew of problems and lawsuits related to the 2008 financial crisis and of sub-prime loans.
A shakeup at Hewlett-Packard. The company is looking to spin off its personal computer business. It's also killing off its TouchPad tablet, which it launched a month ago. HP's CEO said his vision now is to focus more on software.
And AIG chipping away at its debts repaying the government another $2.15 billion. But the bailed out insurer, it still has a long way to go toward paying back its $180 billion lifeline from 2008, currently owes Treasury about $51 billion.
And striking Verizon workers gathered in front of CEO's Lowell McAdam's house in New Jersey to protest the telecom's push to roll back wages and to reduce benefits in contract negotiations. Some 45,000 Verizon workers in the East Coast have walked off the job since August 7th.
AMERICAN MORNING will be right back after this quick break.
(COMMERCIAL BREAK)
COSTELLO: Happy Friday to you. It's 29 minutes past the hour. Time for this morning's top stories.
Markets around the globe reacting to Wall Street's sharp sell- off. In Asia, the major indices were off by more than 2.5 percent and in Europe where trading is now under way the major markets also down. U.S. stock futures also trading lower this morning. The Taliban claiming responsibility for back-to-back explosions targeting the British Council in Kabul, Afghanistan. At least eight were killed in the attack, including two police officers. According to authorities, the strike started when a vehicle packed with explosives blew up outside the gates of the Council. A second man wearing a vest with explosives then detonated himself.
And there's word of a possible deal that could free the so-called West Memphis Three. After 18 years behind bars, the men were convicted of murdering three young boys in Arkansas back in 1993. Sources telling CNN they could be released at an emergency court hearing today in Jonesboro, Arkansas.
ROMANS: All right. Talk about a sign of desperate economic times, we want to look at this line in Atlanta. Hundreds of people standing in 90-degree heat, some fainting, all for a chance to meet with employers at a job fair hosted by the Congressional Black Caucus. The frustration, like the heat, was palpable.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Something like a month or so, you start to feel like, you know, is there any hope, is anybody looking at your, you know, profile online? Not many responses that you get back.
UNIDENTIFIED FEMALE: Job market is horrible out here. I mean, I've never just been without a job this long in life. Ever. Ever, ever.
(END VIDEO CLIP)
ROMANS: Nine-point-one percent unemployment, markets sinking -- can anything turn this economy and what will it be? My next guest said look no further than the Federal Reserve.
Bruce Bartlett a contributor to "The New York Times" economic blog and former treasury official under President George H.W. Bush. He joins me live now from Washington.
Good morning, sir.
You know, the Dow Jones Industrial Average down 419, still have a 9.1 percent unemployment rate, gold hitting a record of $1,850 an ounce. How dangerous is this territory we're in right now for the U.S. and global economy?
BRUCE BARTLETT, CONTRIBUTOR, "THE NEW YORK TIMES": Oh, I think it's very dangerous. But -- and the main reason why it's so dangerous is because the world governments are essentially out of ammunition. It's hard to see where the growth is going to come from under current circumstances.
ROMANS: You know, the White House, Congress, everyone sort of looking to Washington to fix it. Who's got the plan, what is the plan? Some people just say no to whatever plan they hear.
You say we're barking up the wrong tree, that the answer lies with the Fed?
BARTLETT: Well, my feeling is that the basic problem of our economy right now is a lack of aggregate demand. And the best way to get this going would be through some kind of expansionary fiscal policy. But I think that's pretty much off the table for obvious political reasons.
ROMANS: And what you mean by expansion of fiscal policy -- spending money?
BARTLETT: Well, that's right. There's plenty of liquidity in the economy. There's plenty of money around. It's just sitting in bank vaults gathering dust, so to speak, and something needs to get it moving, to get spending going again -- spending for goods and services, spending for investment goods. And that really would be best done through public works, government jobs programs, things of that sort.
But since that's not possible, then we have to look to the one institution that still has freedom of action, which is the Federal Reserve, and I think they need to be much more aggressive. The risks of doing to little are far greater than the risks of doing too much.
ROMANS: But I'll tell you, I hear this from you, I hear this from other reasonable people who are saying, you know, what we need to do to make sure the system can withstand whatever it is we're facing in the world and then you hear people like Rick Perry on the campaign trail, or Sarah Palin saying that Rick Perry is absolutely right, and they're blasting the Fed. And Rick Perry said the Fed is treasonous.
I mean, I don't think politically can the Fed do anything else?
BARTLETT: Well, Rick Perry is an idiot and I don't think anybody would disagree with that.
But the thing is that the politics of the Fed itself are really a more serious problem. You've got three members of the Federal Open Market Committee who are already dissenting against just maintaining the current level of accommodation. And so, to do more would certainly be very controversial and I think that the one problem has been historically that the president has not focused on the Fed. He has had open seats on the Fed almost his entire presidency and I think that this sends a signal that he just doesn't really care very much about what the Fed does.
ROMANS: What do you think the president should do? I mean, he's being really criticized for going on vacation in Martha's Vineyard, although we know these presidential vacations are working vacations.
But what do you think he should order up or come out with in September when he gives his big jobs plan? Does it matter if his opponents are just going to say, whatever you want, we don't want?
BARTLETT: Well, I think he's trying to give some hope to his base, but I think realistically there's virtually nothing he can do because there's -- anything that would be substantive would require congressional action which is basically impossible.
What he could do is start to educate people about the true nature of our economic problem, which as I said, I think is a lack of aggregate demand.
ROMANS: Right.
BARTLETT: And if that idea started to get out into circulation, then it might be possible for the Fed to do some things that are a bit more aggressive, then I think it feels capable of doing at this moment.
ROMANS: We're in this confidence trap. You know? So you've got businesses sitting on $2 trillion, banks sitting on a $1.5 trillion, I guess, of capital, you got people at home trying to figure out how to keep money in their pocket because they're worried about losing a job, you watch the Dow fall yesterday and all this volatility, it's almost this vicious cycle of a lack of confidence.
You say more aggregate demand, more money, the Fed pumping in more money is something that could break that cycle.
BARTLETT: What we need is spending. We need people to get out there and spend. And adding to liquidity is not necessarily going to help.
Businesses, as you say, have $2 trillion of liquid assets that could begin investing and hiring tomorrow, if they had some prospect of increased sales in the future that would justify that investment. Households are saving at a historically high rate.
ROMANS: Right.
They're putting off all kinds of purchases. They could begin spending as well. They have the wherewithal. They just don't have the expectations of the future that things are going to be better that would lead them to move.
ROMANS: All right. Bruce, I wish we had more time.
Jump in, carol.
COSTELLO: Just going back to Rick Perry, because Bruce, you called Rick Perry an idiot, can you just expound on that? I mean, is his kind of talk -- how is that affecting, you know, our economic situation or the way Americans understand what's happening in the economy?
BARTLETT: Well, it has people thinking that the Fed doing its normal job is somehow a treasonous act is grossly irresponsible, and to the extent that people think that Perry knows what he's talking about, it does put a constraint on the Federal Reserve to be able to be more aggressive, which I think that it should be.
The idea that we're debasing the currency is just the grossest nonsense. You can find the data as easily as I can and show that Ben Bernanke has probably had the lowest level of inflation as Fed chairman than any Fed chairman in history. So, if any -- if he's to be criticized for anything it's deflation, not inflation.
ROMANS: You hear all this about transparency, Bruce. I mean, I'm looking -- Carol and I are looking at the balance sheet of the Federal Reserve right in front of us. It's more transparent today than it has been in the past 10 years, the past 20 years. But it's still sort of the same old conspiracy theories and criticisms you keep hearing and I think -- Carol, it's a good point, how does that -- how does that hurt sort of the healing process?
COSTELLO: It confuses people, because they don't know who to believe or what to believe because when you use language like that, it makes it difficult to hear anything else. You hear the word treason and you're like, and you don't hear anything else.
ROMANS: All right. Bruce Bartlett, we have to leave it there.
Thank you so much, former treasury official under George H.W. Bush and contributor to the blogs at "The New York Times." Thank you, sir.
COSTELLO: A Michigan man is facing charges driving his pick-up truck during rush hour even though he knew it had no brakes.
Take a look at this police dash cam video. Watch the driver doing his best, Fred Flintstone imitation, sticking his foot out the door on to the asphalt in an attempt to slow the truck down. Of course this isn't bed rock. He hit four cars -- which begs the question: why would anyone knowingly drive with no brakes?
(BEGIN VIDEO CLIP)
JAMES BERLIN, DEPUTY POLICE CHIEF: What he was doing, it's so stupid it's funny. He admitted or knew that he had no brakes. He thought he could do it. He wanted to get home. Said he had a very long day at work and had to work today. No alcohol, no drugs, just a serious lack of common sense.
(END VIDEO CLIP)
COSTELLO: Unbelievably no one was hurt and the driver, he's facing reckless driving charges.
ROMANS: Wow.
COSTELLO: Coming up next, growing more popular. The sport, not the vegetable, talking about squash. Why inner city kids are putting aside their basketballs and picking up rackets instead.
ROMANS: A life guard suing New York state over a Speedo.
It's 39 minutes after the hour.
(COMMERCIAL BREAK)
ROMANS: Hoops in Harlem, have always gone hand in hand. But now, there's a new street game in some New York City neighborhoods and you might not guess what it is.
COSTELLO: Street game, squash, really?
It turns out a sport once reserved for prep schools is offering inner city kids a way to move up and out of the neighborhood.
Wow, I love squash. It's a tough game, though.
SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: It was fun to watch. I'll tell you, who would have thunk it?
I mean, we're talking about someone who came up with an idea and said, why not? How about combining a mentoring program with a sport that kids in Harlem aren't usually exposed to. So far, it's a winning combination and if you'll pardon the pun, kids are having a ball.
(BEGIN VIDEOTAPE)
CANDIOTTI (voice-over): For these students in Harlem, learning how to play squash is opening doors to a college education.
GEORGE POLSKY, FOUNDER/STREETSQUASH: For about the first nine years of the program, we were borrowing other people's courts.
CANDIOTTI: George Polsky's biggest fear when he founded street squash 12 years ago was that kids wouldn't be interested.
POLSKY: Especially in the beginning, no one had any idea what the game was.
CANDIOTTI (on camera): Probably say what, squash? What's that?
(voice-over): This 10-year-old's reaction was typical. Had you ever heard about squash before?
KARAN BUDHIRAJA, STREETSQUASH STUDENT: No. Actually, I thought it was some vegetable before I learned ability street squash.
CANDIOTTI: The idea behind the privately-funded program is to introduce students to a new sport, which in turn is used as an incentive to help them focus on their academics.
BUDHIRAJA: They help you with schoolwork and stuff. They're like your teachers out of school.
CANDIOTTI: The year-round program is offered to local public school students in grades 6th through 12. Half the time is spent playing squash, the other half, on schoolwork.
UNIDENTIFIED FEMALE: How about Mary Lou Retton?
KAMALI WILLIAMSON, STREETSQUASH STUDENT: If they see my grades lacking, they could probably like tell me you need to do -- pay more on your academics than squash and they can help me with my homework and --
CANDIOTTI (on camera): They'll stay on top of you?
WILLIAMSON: Yes.
CANDIOTTI (voice-over): Tutors help kids with their homework, literacy and eventually college prep programs.
The goal is a high school diploma and a college education.
Rosmery Hidalgo, a street squash alumnus, is now a student at Connecticut College. This summer, she's back in New York helping out.
(on camera): If you didn't have the program, what do you think your chances might have been, to get a full scholarship, exactly, to college?
ROSMERY HIDALGO, STREETSQUASH GRADUATE: Zero. Without this program, I was not going to go into that school at all.
CANDIOTTI (voice-over): Some of the students have earned scholarships to play squash in college.
Polsky says it's not about the sport.
POLSKY: Kid not able to hit a forehand, could be a terrible athlete, goes to college, graduates from college, I'm happy.
CANDIOTTI: All students who stick with the program graduate from high school and go on to college. And of those, 85 percent are on track to earn a degree.
(END VIDEOTAPE)
CANDIOTTI: And StreetSquash doesn't drop the ball when its grads go on to college. A mentor visits them at school twice a year. And as one alum puts it, it shows that they care.
COSTELLO: So it doesn't sound that much matter the sport, but I'm just wondering why pick squash?
CANDIOTTI: He played it in college, so it was a favorite of his.
(LAUGHTER)
CANDIOTTI: Plus, there's actually just a few cities that have a league so the kids get to travel out of town and a lot have never done that before. So, they're loving it. So, there are a lot of advantages all the way around.
ROMANS: Awesome. What a great story. Susan Candiotti, thanks, Susan.
CANDIOTTI: You're welcome. ROMANS: He spent 40 years as a lifeguard at New York's Jones Beach. Now, 61-year-old Roy Lester is drawing a line in the sand saying he's too old to be forced to wear a skimpy form hugging Speedo.
COSTELLO: I'm with you, mister.
(LAUGHTER)
ROMANS: Lester claims he was fired four years ago when he refused to squeeze into a Speedo for a swim test. He sued New York State claiming age discrimination and insist putting him in a skimpy swimsuit is just plain wrong.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: You ask the people out there if they want to see a 61-year-old in Speedos.
UNIDENTIFIED FEMALE: I don't think it's right that you have to show your junk. That's all. It's just nasty.
UNIDENTIFIED FEMALE: I do agree that anyone above 30 shouldn't be wearing a Speedo.
(LAUGHTER)
UNIDENTIFIED FEMALE: Is standard bathing suit going to impair his function?
(END VIDEO CLIP)
ROMANS: Lester's age discrimination suit was dismissed twice, but just got reinstated so the case could go on trial later this year.
COSTELLO: Do you want to see anyone in a Speedo?
ROMANS: No. I don't. No. I mean -- no.
COSTELLO: It's so embarrassing, sometimes.
ROMANS: No. Unless, I'm watching the Olympics, basically.
COSTELLO: Oh, yes, because that's not bad, like Mr. Phelps.
ROMANS: Yes.
COSTELLO: Yes. That's not bad. Forty-six minutes past the hour. We'll check this morning's top stories straight ahead.
ROMANS: Plus, the art of the walkout. Jeanne Moos with some do's and don'ts for talk show guests who decide that it's time to make a sudden exit. It's 47 minutes after the hour.
(COMMERCIAL BREAK)
COSTELLO: Forty-eight minutes past the hour. Here's what why you need to know to start your day.
(BEGIN VIDEOTAPE)
COSTELLO (voice-over): A sharp sell-off around the globe in Europe where trading is now underway. The markets are down. They also closed lower in Asia. And here in the United States, stock futures are down this morning after a very rough session yesterday.
In Afghanistan, two bombers attacked the British council this morning in Kabul. At least eight people were killed, 10 others are being treated for their injuries. The Taliban has claimed responsibility.
Israel launching air strikes against militant targets in Gaza. It's in response to a string of attacks in Southern Israel that killed seven people and wounded dozens of others.
The West Memphis three could be free men today after nearly two decades in prison for killing three cub scouts in Arkansas. A judge has called an emergency hearing to determine if they were wrongly convicted.
And an activist in India who's been compared to Ghandi is now out of jail and will continue a two-week hunger strike. Anna Hazare is the face of the country's grassroots anti-corruption campaign.
Pope Benedict speaking to thousands of young people in Spain for World Youth Day. The pope's welcome, a stark contrast to massive protests across Madrid. Spaniards protesting the cost of the pope's four-day visit in the face of 21 percent unemployment.
(END VIDEOTAPE)
COSTELLO (on-camera): And that's the news you need to start your day. AMERICAN MORNING back after this.
(COMMERCIAL BREAK)
COSTELLO: Fifty minutes past the hour. We gave you a chance to talk back on one of the big stories of the day. And boy, do you have a lot to say. We asked you this question, is President Obama neglecting the black community.
This from Heather, "When president Obama was elected president, he was elected to represent all races, not just one. All races elected him, so to complain that he's neglecting one over another should not be. This needs to be understood."
This from Jennett, "Of course not. It's all political strategy. There's an election coming, and Obama already knows he has the black vote."
And this from James, "He's neglecting all the various communities that elected him."
Keep the conversation flowing. Facebook.com/americanmorning. ROMANS: All right. Christine O'Donnell's walkout during her interview with Piers Morgan. That happened this week. It got some of us thinking about some of the more memorable television interviews gone wrong. It's just so fun to watch. CNN's Jeanne Moos now on the art of the exit.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN NATIONAL CORRESPONDENT (voice-over): Who doesn't love a walkout? Sometimes, it makes great TV when hosts and guests disagree.
PIERS MORGAN, CNN ANCHOR: Why are you being so weird about this?
CHRISTINE O'DONNELL, FORMER SENATE DELAWARE CANDIDATE: I'm not being weird, you're being a little rude.
MOOS: But if you're going to walk out of an interview, here's how not to. Do not have your PR person intentionally block the camera.
MORGAN: Where are you going?
MOOS: And if you're going, go. Don't linger.
O'DONNELL: All right. Are we off?
UNIDENTIFIED FEMALE: Larry, you're being inappropriate.
LARRY KING, CNN ANCHOR: What?
UNIDENTIFIED FEMALE: I'm not going to talk about --
KING: I'm asking a question.
MOOS (on-camera): If you're serious about walking off, we recommend you don't keep looking of to the side at your PR people.
MOOS (voice-over): It sort of dilutes the define act of walking off if you're looking for advice from the sidelines.
KING: Who are you talking to?
UNIDENTIFIED MALE: Do you ever worry about your moment having passed?
UNIDENTIFIED FEMALE: Can I -- I was curious about one thing.
MOOS: Do not do as Naomi Campbell did, do not whack the camera. Do not overturn furniture. Just because the host called then quarterback, Jim Everette, a girl's name, Chris Everette. And do not drop a string of F bombs as comedian Andrew Dice Clay did.
UNIDENTIFIED MALE: Guy wants to open a (EXPLETIVE DELETED)
KING: All right, Andrew. UNIDENTIFIED MALE: (EXPLETIVE DELETED) here. You know, (EXPLETIVE DELETED) what (EXPLETIVE DELETED) network
MOOS: If you must cuss.
UNIDENTIFIED MALE: I think that's (EXPLETIVE DELETED).
MOOS: Try to confine yourself to a single expletive bleeped. Remember, TV producers love walkouts. Your walkout is likely to end up as a promo.
UNIDENTIFIED FEMALE: Sorry? What's your question?
UNIDENTIFIED MALE: It's the weirdest interview you'll ever see.
UNIDENTIFIED FEMALE: Delete that.
UNIDENTIFIED MALE: What sent Fergie completely off the rails?
MOOS: If you want to see an expert walk out, check out the young Donald Trump.
DONALD TRUMP, BUSINESS TYCOON: Do this interview with somebody else. You don't need this. Do it with somebody else.
MOOS: Kiss front man, Gene Simmons, was being interviewed with his significant other of 28 years when Joy Behar brought up his claim that he slept with 5,000 women.
GENE SIMMONS, KISS FRONT MAN: My back is good. My shrekel (ph) not so much.
UNIDENTIFIED FEMALE: That's very nice of you to joke.
SIMMONS: It's a joke! (EXPLETIVE DELETED) off. Where are you going? Thanks for the question.
MOOS: His companion headed off toward the New York skyline.
MOOS (on-camera): What she didn't know is that the only way out of here is through this fake garden wall.
MOOS (voice-over): So, momentarily corralled she paced.
SIMMONS: Please come back here.
UNIDENTIFIED FEMALE: You know what, no, you joke about it, and it's not funny.
JOY BEHAR, HOST, JOY BEHAR SHOW: Shannon, you want to come back? She doesn't.
MOOS: Before your walk out, make sure that there's some place to walk to.
Jeanne Moos, CNN. SIMMONS: Shannon, come back.
MOOS: New York.
(END VIDEOTAPE)
ROMANS: Like a sesame street set, actually. You can't figure out what's real and what's not.
COSTELLO: My favorite walkout the sports guy who beat up -- if you're going to walk out do it like you know --
ROMANS: And try not to have an assault case at the end of it, this block out.
(LAUGHTER)
ROMANS: All right. Top stories are coming up next, including a check of overseas markets.
COSTELLO: Do we have to?
ROMANS: Yes. I'll tell you everything is down right now. We're still -- just cannot get out of this confidence problem, Carol.
COSTELLO: I know. I know.
ROMANS: Also, breaking news out of Afghanistan. Back-to-back explosions rocking the capital there. One of our own reporters actually caught in the chaos. We're going to show you. You're watching AMERICAN MORNING.
(COMMERCIAL BREAK)
