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New Day

Signs of Pandemic Shift; Homebuyers Scramble as Mortgage Rates Rise; Pundits got Biden's News Conference Wrong; Biden's Approval Rating; American Flight Mask Dispute. Aired 6:30-7a ET

Aired January 21, 2022 - 06:30   ET

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


[06:30:00]

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Drop in demand for Peloton bikes. The CEO, John Foley, he confirmed there could be layoffs and what he called a production reset. He acknowledged Peloton is considering all options. It's because CNBC reported leaked internal Peloton documents that showed plans to temporarily pause productions of its bikes and treadmills. Essentially after blistering demand during the pandemic, the company found itself with too much inventory.

And then stock of another pandemic winner, Netflix, that stock dropped about 20 percent, down 20 percent after hours. Fewer new subscribers in the fourth quarter. And Netflix forecasts it will not add as many in the first quarter as expected. Netflix blamed competition from rivals and just not enough original programming early in the first quarter. It's not expecting any big new releases until later this year. And like if you're one of those "Squid Games" fans, folks, Netflix confirms a second season is coming. That's it's biggest ever hit. It's on the way. It also plans to offset the slower growth with higher prices. It's raising prices, Kasie, in the U.S. and Canada.

KASIE HUNT, CNN ANCHOR: I know I personally am waiting with bated breath for the second season of "Bridgerton." So maybe that can help then if we can get around to that.

ROMANS: Me too. You and I, we're more "Bridgerton" speed than "Squid Game" speed. I see that.

HUNT: I am as well. Thank you so much, Christine Romans.

JOHN BERMAN, CNN ANCHOR: Romans, the way you said that, if you're one of those "Squid Game" fans, Romans. As if you're judging. If you're one of those "Squid Games" fans.

HUNT: Are you a "Squid Game" fan, Berman?

BERMAN: I mean you don't -- I don't think you're a fan of it. I mean it's just bad things that happen, but I watched it and appreciated it, but I just don't want to be judged. That's all I'm saying.

ROMANS: I -- I will judge you, John.

BERMAN: I know. ROMANS: I will judge you all day long.

BERMAN: I know. Which I actually find reassuring in its own way, but that's totally separate.

All right, Christine Romans, thank you very much.

So, it might be a good time to lock in a mortgage rate. Rates are up from a week ago, now at their highest level since March of 20th.

CNN's Vanessa Yurkevich joins us.

This has big implications across the economy, Vanessa.

VANESSA YURKEVICH, CNN BUSINESS AND POLITICS CORRESPONDENT: Absolutely. So, home buyers are not getting that rock-bottom price of sub 3 percent for their mortgage. So that may price some people out of the market. It may cause others to quickly re-do their finances so they can figure out if they can afford that home that they're looking at. But one thing is for certain, John, the buyers we spoke to are pretty nervous and pretty anxious.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Stu.

STU KOZLOWSKI, LOS ANGELES HOMEBUYER: (INAUDIBLE).

UNIDENTIFIED MALE: Hey, man, welcome.

YURKEVICH (voice over): Stu Kozlowski is on the hunt again.

UNIDENTIFIED MALE: Here we have two bedroom, two and a half baths.

YURKEVICH: He's looking for a home in Los Angeles for himself and his eight-year-old daughter after he fell out of escrow on another property last month.

KOZLOWSKI: How many square feet is it?

YURKEVICH: Besides worrying about square footage, there's low inventory, sky-high prices and bidding wars, and now rising mortgage rates.

KOZLOWSKI: They're almost a point higher than they were when I made that offer and got under escrow. So, that's a significant jump.

YURKEVICH: This week, a 30 year fixed rate loan is 3.56 percent, back up to pre-pandemic levels. On the median home price of $350,000, Americans can expect to spend $120 more on average, excluding taxes and insurance, than they did a year ago.

KOZLOWSKI: I think that affects the kind of homes I look at. That affects the neighborhoods I look at. That affects the kind of things I'm willing to go and have conviction about that maybe I didn't a month ago or a week ago. YURKEVICH: Mortgage rates are going up in anticipation of higher

interest rates, which the Federal Reserve said would happen this year. In just the last month, a 30-year mortgage rose by a half a point.

JOE REICHLING, REALTOR, BRYANT\REICHLING TEAM, COMPASS: Every half point that mortgage rates rise, I think that definitely has an impact on what buyers are willing to do, how far they're willing to stretch on home purchase.

YURKEVICH: Rising rates will affect home buyers in pricier coastal cities where they're more often right on the cusp of qualifying for a home mortgage. In Chicago, where realtors say there's more inventory, it means locking in a good mortgage rate now.

MARY KATE OU, CHICAGO HOMEBUYER: You don't want to pay more money if you don't have to. So, that's kind of why we did decide to go through the preapproval process earlier, so that that way if we did find something, we could jump on it.

YURKEVICH: Mary Kate Ou and her husband on first-time home buyers, working against two timelines, their lease is up in six months and rising mortgage rates.

OU: We've definitely been kind of accelerating that timeline a little bit more recently.

And what's the price on this one?

TONY MATTAR, REALTOR, HOMECO CHICAGO, COMPASS: This one's 950.

YURKEVICH: Her realtor, Tony Mattar, says rising rates are bringing up FOMO among many of his first-time buyers. That's fear of missing out.

MATTAR: There might be some folks out there who were considering buying a home six months or nine months ago and didn't that might be kicking themselves.

YURKEVICH: Pushing buyers to move quickly before mortgage rates and home prices get any higher.

OU: Maybe that's where some of the nerves and the excitement all come together.

(END VIDEOTAPE)

YURKEVICH: And those home prices up 17 percent last year from 2020. There's also such low, low inventory, John. And with these rising rates, realtors are saying that this may ignite a little bit of a buying frenzy right now so that homeowners can make sure they get whatever is still left on the market with these still attractive rates.

[06:35:11]

But, John, these buyers that we spoke to are getting a little bit nervous. Not a lot of options. Rising costs. They want to make sure that they can still get their dream home right now, John.

BERMAN: I was going to say, buying a home, particularly your first home, is so stressful anyway.

YURKEVICH: Yes.

BERMAN: And this just adds to the anxiety.

Vanessa Yurkevich, thank you very much.

President Biden's approval rating hitting a new low, but still higher than someone's. Guess who?

Plus, Kevin McCarthy may be hitting a bump on his road to the speakership.

HUNT: And, this.

(BEGIN VIDEO CLIP)

ADELE: I can't give you what I have right now. And don't got it. I don't got it.

(END VIDEO CLIP)

HUNT: Adele making a tearful announcement hours before she was set to start her Las Vegas residency. What happened, head.

(COMMERCIAL BREAK)

[06:40:10]

HUNT: Welcome back.

In President Biden's first news conference this year, he suggested that the legitimacy of the upcoming midterm elections might depend on voting rights legislation passing Congress.

(BEGIN VIDEO CLIP)

JOE BIDEN, PRESIDENT OF THE UNITED STATES: I'm not saying it's going to be legit. It's -- the increase in the prospect of being illegitimate is in direct proportion to us not being able to get these -- these reforms passed.

(END VIDEO CLIP)

HUNT: It has led -- it has led to some questions about whether this is equal to the former President Trump undermining election integrity. That's an equivalency that our next guest argues is the wrong one -- isn't the wrong -- isn't the right one to make.

Joining us now, CNN White House correspondent John Harwood.

John, so what's your -- what's your argument here?

JOHN HARWOOD, CNN WHITE HOUSE CORRESPONDENT: First of all, welcome back, Kasie. It's great to see you back in the studio.

HUNT: Thank you. It's great to be here.

HARWOOD: Look, let's step back and think about what both men have tried to do. Donald Trump lost the election in 2020, lied about it, claimed fraud, tried to overturn it legally, failed, tried to bully election officials, get me 12,000 more votes, failed, and then incited mob violence against the Capitol. He was trying to corrupt the election. And since 2020, that corruption effort failed, Republican legislators around the country have been trying to engineer changes in election administration and voting procedures to make sure that they can succeed where Trump failed. That is pretty stark. That's why we've been covering democracy in peril.

Joe Biden is leading Democrats to try to protect the integrity of elections. And those are pretty fundamentally different things. Now, that doesn't mean that it was right for Joe Biden to question the legitimacy of the 2022 elections because the most significant threats are in 2024 not 2022. And it is true that some of these state laws are going to have incremental effects and may not, in and of themselves, make the election illegitimate.

But I think the question is less of a stark black and white choice, legitimate or illegitimate, but it's more on a continuum. And the more you impede voting by groups that you're trying to prevent from voting against you, the more you interfere with election administrations so that you can try to overturn some of those results, the less legitimate results are.

Now, some of the election experts I talk to said he shouldn't say that the election might be illegitimate because you don't want to trigger the electoral confidence equivalent of a run on the bank and further undercut confidence. But there is a genuine threat to American democracy. And that's what Joe Biden was highlighting.

BERMAN: Likewise, John, obviously the president received a great deal of criticism for the way he talked about Ukraine. Is there a different way to look at it that has been covered? Is it not as damaging, as some suggest, to say that there would be different responses for different Russian actions?

HARWOOD: Well, I thought that was the most jarring point of the news conference. I didn't understand why he said it or why he predicted that Putin would go in when U.S. diplomats have been saying publicly, we don't know what he's going to do.

But your conversation yesterday with Julia Iloffe (ph) indicated, I think, a perspective issue that we should remember, and that is to say, what Julia mentioned, that some of our colleagues have said as well, that what Joe Biden alluded to, that is the different responses to different offenses by the Soviet Union, are things that our diplomats and national security officials have been saying privately. If they've been saying privately to reporters and to other diplomats, it is hard to imagine that anything Joe Biden alluded to is not already known by Vladimir Putin. Vladimir Putin is the decision maker. So if it doesn't change what Putin knows as he's making his decision,

how significant is the green light? Certainly, as a public matter, the Ukrainians had to react because it sounds bad, but does it really change the dynamics of the decision that rests with Vladimir Putin himself? I'm not sure.

HUNT: Now -- no, it's an interesting point. Although, the one thing I will just -- just add is that we know that Vladimir Putin has been trying to sow division in the United States in the effort to make us weaker.

HARWOOD: No question.

HUNT: And any perception among our allies that there is weakness coming from Joe Biden is potentially adding to that danger.

John Harwood, thank you very much for being up early. It's great to see you, my friend.

HARWOOD: You bet.

BERMAN: All right, President Biden now one year and one day into his presidency. Public approval at a low for him.

Joining us now, CNN's senior data reporter Harry Enten.

[06:45:02]

What direction, Harry, is the president's polling going?

HARRY ENTEN, CNN SENIOR DATA REPORTER: This direction, down, down. Down, down, down.

Look, if you look at Joe Biden's popularity, you compare it now to different places in time, you can see it right here on your screen right now, he's just at a 41 percent approval rating. It was 44 percent a few months ago. In the middle, summer of last year, you know, we were standing on that -- we were saying, oh, my, Biden's numbers seem to be holding. He was at a 53 percent approval rating. He's well down from 55 at the beginning of his presidency. And election day 2020, when he beat Donald Trump, his favorable rating was 52. He's 10 points below that. So he's going in the wrong direction.

BERMAN: Compare him to the other guys who have been in the White House.

ENTEN: Yes, look at all the presidents since 1978. Look, we have the list of them there. You can see, he's at 41 percent. The only one below him was Donald Trump at this point at 39 percent. He is well below even where Barack Obama was at this point, who was at 50 percent, and certainly well below where George W. Bush and George H.W. Bush. They were around 80 percent.

Joe Biden has the lowest approval rating at this point for any president since World War II in his presidency. BERMAN: Although you do -- yes. So, Harry, when you talk about his

numbers going down, one of the things that I think has to concern the White House is, with whom specifically.

ENTEN: Yes, he's losing voters both in the middle and among voters who are traditionally part of the Democratic base. People of color, obviously, are a big part of the Democratic base. His favorable rating among them was 72 percent on Election Day 2020. It's now -- his approval rating is just at 53 percent.

Younger voters, those age 18 to 34, his approval rating is just 37 percent in an average of polls. He had a favorable rating of 60 percent among them on Election Day 2020. And then, of course, independents voters, who are so important, that was the group that voted for Donald Trump in 2016, then switched their allegiances to Joe Biden in 2020. His favorable rating among them on Election Day 2020 was 52 percent. His approval rating now among them, just 33 percent. No bueno, John, no bueno.

BERMAN: Coronavirus was an issue that was actually helping keep his numbers high. What's happening now?

ENTEN: Yes, you know, if there was one issue that helped Joe Biden win the presidency back in 2020, it was because people disapproved of the job that Donald Trump was doing on the coronavirus.

Look, Joe Biden came into the White House with a head of steam on his handling of the coronavirus. You know, you go back to May of 2021, that was a time at which, you know, we were getting the vaccines out. People were really happy with the way things were going. His approval rating on that issue was 63 percent, a disapproval rating of 32 percent. You go to September of 2021, when the delta variant was taking hold, his approval rating dropped to 53 percent. Now in the age of omicron, look at that, the numbers have flipped. His approval rating is below his disapproval rating, just a 42 percent approval rating on the -- his handling of the coronavirus, disapproval rating all the way up to 49 percent. The complete wrong direction.

BERMAN: What about the economy, Harry?

ENTEN: Yes, the other big issue is the economy, right? So, take a look here. This is the net approval -- well, that's the approval rating minus the disapproval rating on the economy at this point of presidencies since 1978. Joe Biden is at the bottom, the bottom of the list here with a minus 17 point net approval rating. His disapproval rating is 17 points above his approval rating. That is the worst on record for any president at this point in their presidency since 1978. It is well below the last guy, Donald Trump. The economy was actually a big thing for him, a positive. His net approval rating was actually in the green, plus 8 points. Joe Biden, 25 points below that at minus 17 points. Not good.

BERMAN: Harry Enten, you are a fan of the only football team to play in New York. New York's only football team, the Buffalo Bills. They have a big game this weekend. What do you want to say? ENTEN: Well, I don't want to rub your nose in it. I think we had a

segment last Friday, I think I might recall. You know, you were a fan of that team we had a perfect game against. We didn't turn the ball over. We scored a touchdown on pretty much every drive except for when we downed it.

Look, the thing that I love about the Buffalo Bills is, if you look across the country, there are only two places in which their Google trends are the first or second. One's New York. The other is Wyoming, where Josh Allen, of course, went to school. I love it. I love it. I love it.

Go Bills, this weekend. I'm really hopeful. I'm praying. Please, just once, just win a Super Bowl once. Please!

BERMAN: Harry, I will tell you -- first of all, I should have called you or texted you after the game last week. I didn't. I apologize. It wasn't out of spite. It was because I went to bed. It was such a bad game, I couldn't stay awake.

Finally, to make up for that, I am going to cheer for the Buffalo Bills. They are going to be my team until they get to the Super Bowl and lose to Tom Brady. That's my promise to you.

ENTEN: Well, you know, boy, I love losing Super Bowls I think is the old saying. But this year, I think we're going to turn it around.

BERMAN: Harry Enten, best of luck to you.

ENTEN: Thank you. I need it. All the luck. All the luck my way.

BERMAN: All right, one hour into a flight, the pilot forced to turn the plane around. Why? An airborne mask hole (ph).

HUNT: Oh, boy.

And M&Ms getting a makeover. Why everyone is up in arms about the green M&M's redesign.

(COMMERCIAL BREAK)

[06:54:11]

HUNT: So in yet another edition of passengers flying off the handle, an American Airlines flight from Miami to London turned around in the middle of a flight on Wednesday because of an incident involving a woman who refused to wear a mask.

CNN's Pete Muntean joins us.

Pete, what is wrong with people and what happened here?

PETE MUNTEAN, CNN AVIATION CORRESPONDENT: We thought this was going to be a 2021 problem, Kasie. Still apparently an issue in 2022.

Imagine the frustration of these passengers onboard American Airlines Flight 38. There's the Flight Aware track. From Miami to London Heathrow. The blue arch is the eight hour and 45 minute flight plan. The green down there, that is the flight turning around after only 45 minutes in. One hundred and twenty-nine people on board. A lot of disappointed folks. American ultimately had to cancel this flight.

Now, American says this was all because this woman had a mask dispute on board, caused a disruptance on board.

[06:55:05]

The plane turned around. Miami-Dade police met her at the airplane, escorted her off. And Miami-Dade police say it's up to the airline to deal with this.

Now, there were three different options here. The airline can ban her from flying again. The FAA can bring civil fines. It cannot bring criminal charges. The DOJ can. And AG Merrick Garland says this is a top priority, but that does take a little bit of time we have seen in the past.

Just look at the numbers there though. We have seen 151 incidents of unruly passengers so far in 2022, 92 of them over masks. Look at the 2021 numbers, 5,981 incidents in total, 4,290 mask related, 72 percent. Now, luckily, the rate has gone down a little bit but all of this really started to rear its head just after January 6th. Clearly this problem is not over just yet, Kasie.

HUNT: It sure isn't. And, you know what, it was hard enough to be a flight attendant before the pandemic having to deal with unruly passengers.

MUNTEAN: Yes.

HUNT: And this is just astonishing.

MUNTEAN: Yes.

HUNT: And my thoughts are with everyone who has to get up and fly in the skies every day as all of this is unfolding.

Pete Muntean, thanks very much for your reporting.

MUNTEAN: Any time.

HUNT: All right, coming up next here, a proposal to vaccinate migrants now back to the table and causing political infighting in the Biden administration.

BERMAN: And rock star Meat Loaf has passed away. We're going to remember his music, his legacy. Much more ahead.

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