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DOJ Gets Win, Can Use Classified Docs in Trump Criminal Probe; Book: Trump's Biz Practices included Once Being Paid in Gold Bars; Trump's Empire at Risk after NY AG Accuses Him, Children of Fraud; Russians Protest Putin's Mobilization, 1,300 Arrested; Federal Reserve Raises Interest Rates a Third Time; Hurricane Warning Issued for Bermuda as Fiona Approaches. Aired 6-6:30a ET
Aired September 22, 2022 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JOHN BERMAN, CNN ANCHOR: A bruising legal 24 hours for Donald Trump and a bizarre new defense. I'm John Berman with Brianna Keilar.
And overnight the Department of Justice scored a significant win in the FBI's search of Mar-a-Lago for classified documents. An appeals court reversed a judge's decision and will now allow investigators to use some 100 classified documents as part of their criminal probe.
Neither the special master nor Trump's team will have access to them.
Part of the appeals court reasoning is that the Trump team has never produced any evidence or even arguments that the documents were declassified. Now, on that subject, also overnight, Trump offered a, frankly, odd defense.
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DONALD TRUMP, FORMER PRESIDENT OF THE UNITED STATES: If you're the president of the United States, you can declassify just by saying, It's declassified. Even by thinking about it. Because you're sending it to Mar-a-Lago or to wherever you're sending it, and there doesn't have to be a process. There can be a process, but there doesn't have to be. You're the president. You make that decision. So when you send it, it's declassified. We -- I declassified everything.
(END VIDEO CLIP)
BERMAN: He seems to be creating a new security category: declassified in his mind. More on that in a moment.
BRIANNA KEILAR, CNN ANCHOR: And in New York, Trump, his children and his empire accused of fraud, deceiving lenders, insurers, tax officials over the value of his properties for more than a decade.
The New York attorney general wants the Trump Organization dissolved.
Also in New York, Trump is now facing a new sexual battery lawsuit from E. Jean Carroll, who has accused him of raping her in a department store during the mid '90s. He has denied her accusations.
BERMAN: Finally, Ginni Thomas, the conservative activist and wife of Supreme Court Justice Clarence Thomas, has agreed to sit down for a voluntary interview with the House January 6th Committee. The committee has wanted to talk with Thomas about her role in Trump's efforts to overturn the election.
KEILAR: Let's bring in Katelyn Polantz to talk about some of these new developments here.
So Trump losing this special master review issue, which is quite a defeat for him. And the judge ruling that the DOJ can continue its Mar-a-Lago probe here. What more are we learning?
KATELYN POLANTZ, CNN SENIOR CRIME AND JUSTICE CORRESPONDENT: Well, everything Donald Trump was really trying to do here about the heart of this investigation, these 100 or so documents marked as classified, he's not going to get to do. The appeals court is really rejecting literally everything the Trump team tried here and much of the ruling from the lower court judge, Judge Aileen Cannon. She was a Trump appointee.
But on this panel of three judges, two Trump appointees, and they were in unison. Three judges in unison.
Trump was saying to them that maybe these documents were classified. Maybe they were his personal records. He should be able to see them. His team should be able to review everything that was seized from Mar- a-Lago, including things marked as classified.
His team also was arguing that Donald Trump, just the idea that heh was under investigation was hurtful to him. And thus, this investigation should put on hold; they should pump the brakes on it.
The appeals court came back last night and said, No, no, that doesn't make sense. No. And that's not a good enough reason, just the possibility that you could be under investigation, for us to pause the whole thing.
And then finally on this declassification issue, are they declassified, are they not declassified, the appeals court wrote it's a red herring. It just isn't material at this point in time.
Right now they're marked as classified. These appear to be national security secrets that the executive branch, the administration, should really keep control over, has to tread very carefully on who gets to see them.
And the appeals court wrote, "For our part, we cannot discern why the plaintiff, Donald Trump, would have an individual interest in or need for any of the 100 documents with classification markings. A person may have access to classified documents only if, among other requirements, he has a need to know the information. This requirement pertains equally to former presidents, unless the current administration, in its discretion, chooses to waive that requirement." At this point in time, there appears to be no reason why Donald Trump
and his team should be able to look at these. So the criminal investigation is going to be able to restart. Perhaps Trump could appeal to the Supreme Court. But it's bad (ph).
KEILAR: Two of these three justices, two of these three judges, Trump appointed, correct?
KEILAR: OK. So that's just an important thing to note here.
Separately, Ginni Thomas, who of course, is the wife of Supreme Court Justice Clarence Thomas but also a conservative activist, who was talking to a lot of state officials in their efforts to overturn election results, she's now going to talk to the January 6 House Committee. What do they want to talk to her about?
POLANTZ: Right. So Ginni Thomas, obviously, connected to a sitting Supreme Court justice as the wife of Clarence Thomas, she came up in this January 6th investigation that the House has been doing because she was texting Mark Meadows, the White House chief of staff, not just generally, as personal friends, or as a conservative activist. But specifically, about the election, this interesting in wanting to find fraud, wanting to block the result of the election.
And so the committee has been interested since they have been able to review these Meadows text messages. So she is going to sit down for a voluntary interview with them.
KEILAR: That will certainly be interesting to see what they find there. Katelyn, great reporting. Thank you so much.
BERMAN: So just in, a new look at the former president's unusual business practices. According to reporting obtained by CNN from a forthcoming book by "New York Times" reporter Maggie Haberman, Trump was once paid for a business transaction with gold bars wheeled into his Trump Tower apartment.
Haberman also reports that Trump faced far more precarious financial situations than many realized and even acknowledged his business dealings meant he would interact with the Mob.
KEILAR: CNN White House correspondent Jeremy Diamond and Gwenda Blair, author of "The Trumps: Three Generations of Builders and a President," are with us here. Jeremy, tell us more about what we've learned here in these revelations.
JEREMY DIAMOND, CNN WHITE HOUSE CORRESPONDENT: Well, it's really interesting, especially on the heels of what we're hearing from the New York attorney general, in terms of the president overvaluing, according to that attorney general, hundreds of assets by billions of dollars. And now we're learning of several additional practices by the former
president's, including some colorful ones like the one John just described, where former President Trump, back during his business career, was allegedly paid for several of his leases in cash and at least in one instance, in gold bars, a box of dozens of gold bricks to cover a lease on a parking garage at the General Motors building in Manhattan that President -- that Trump owned at the time.
According to Haberman in this book, Trump directed Matt Calamari, who was the chief operating officer of Trump Organization and a former security guard to Trump, to wheelbarrow those bars to his Trump Tower apartment.
Trump denies this, we should note, calling it a, quote, "fantasy question." But it is just one of a series of revelations about these questionable, eyebrow-raising business practices that Trump apparently engaged in during his decades in the New York real estate business.
KEILAR: A wheelbarrow. And so what more can you tell us about this Mob connection or interaction?
DIAMOND: Trump acknowledges to Haberman in this book that -- you know, he says, "Anybody that builds in New York City, whether you dealt with them directly or indirectly, they existed." The Mob.
Now, his connections to the Mob, the fact that he was in businesses, whether it was construction, casino businesses, real estate, the Mob was involved in that in New York city in the '80s and '90s, in particular. So that's been documented.
But there are other, more interesting, questions, frankly, I think, here in terms of this question of overvaluing his assets. Haberman writes that Trump's financial situation was often more precarious than it actually appeared.
In fact, Trump actually borrowed money from one of his executives. This is the executive Ross, who said that it was to, quote, "cover a situation that was disposed of very quickly, not to cover payroll expenses." Not clear exactly what that is.
And then there's this other instance in which Trump was apparently more involved than previously known in misleading the SEC, the Securities and Exchange Commission, in 1999 as it relates to misleading earning statements.
Trump has denied that he was involved in this misleading statement that was uncovered in 1999. But Alan Marcus, a former company consultant, told Haberman that Trump personally marked up the draft and made existing projections rosier than what they actually were. Certainly, that seems to line up with the kind of behavior that
the New York attorney general is now alleging.
BERMAN: Gwenda Blair is with me now. Gwenda, who among us hasn't been paid with a wheelbarrow of gold bars before? That's how I used to get paid for babysitting when I was a kid. I want to leave that aside, if I can. I want to ask you more
specifically about the New York attorney general lawsuit, which appears to be significant, with some significant data backing it up.
Where does this rank? How does this compare to the other legal scrutiny that Donald Trump has been under that you've covered so much over the years?
GWENDA BLAIR, AUTHOR, "THE TRUMPS": If I were him, I'd be pretty nervous. She's got dozens of interviews. She's got, she alleges 200, I believe, violations of law. She's got a lot of documentation.
BERMAN: And in what way does it differ from the types of things he has been, again, under scrutiny before. He sat for a whole bunch of depositions before. This one, though, he took the Fifth.
BLAIR: He took the Fifth. And since it's a civil case, taking the Fifth, jurors are allowed to see some implication in that, as opposed to a criminal case, where you're not supposed to make anything of it.
BERMAN: What about the kids? How much do you think it concerns him that his three adult children are part of this?
BLAIR: Well, he seems to think anybody with the last name Trump is, you know, a little better than anybody else, so I'm sure he's very concerned. Absolutely.
BERMAN: How do you think this will shape the decisions he makes going forward, whether it be deciding whether to run for president, anything else that he might be considering going forward?
BLAIR: Well, his you know, denial machine so that in a sort of -- let's use a homely cookie jar analogy. You know, I didn't put my hand in the cookie jar; it wasn't my hand.
Oh, wait a minute. It was my cookie jar, and it wasn't mine, anyway. He has that kind of response.
So it'll be a whole battery of those responses, of course much more violent than that. I mean, violent, but anyway, much more passionate than that.
BLAIR: And we'll go through all of those. And Letitia James does not look like she's about to be moved by any of that.
BERMAN: Gwenda Blair, thank you so much for joining us this morning.
Jeremy, our thanks to you for your reporting.
New this morning, more than 1,300 people have been detained in cities across Russia in a crackdown on anti-war protests.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: (SPEAKING FOREIGN LANGUAGE)
(END VIDEO CLIP)
BERMAN: Just a sample of how Putin's planned mobilization of some 300,000 reservists is playing out in Moscow, St. Petersburg, and beyond. CNN's Nick Paton Walsh reports from Sloviansk in Ukraine.
NICK PATON WALSH, CNN INTERNATIONAL SECURITY EDITOR: John, Brianna, really, the day in which the rubber hits the road for Putin's high- stakes gamble of calling partial mobilization.
I should point out for ordinary Ukrainians, the siren you're hearing now is just a sign that the constant bombardment often continues in front-line areas.
But for people waking up in Moscow, they are now potentially seeing the possibility of people they know, who are not in the army, being asked to go to the front line here.
And so we are seeing ticket sales, men trying to get out of Russia. We're seeing protests and possibly as many as 1,300 people arrested around those protests.
Remember, when they chant "No to the war," this is after six months of the war, and possibly the fuel that put them on the streets is the fact that ordinary Russians who so far hadn't been impacted are going to see their lives changed.
But it already seems that some people called up in this partial mobilization are going to be rushed to the front. Russia hasn't overcome its major problem, though, which is how do they supply people on the front line, equip those new recruits, and come up with an effective strategy that means these lives aren't potentially wasted in poor decision-making on the front line.
But Ukrainian President Volodymyr Zelenskyy wasting no time during his speech in the United Nations General Assembly, to call for Russia to be stripped of its veto power at the Security Council, saying that the referendums, the diplomacy that Russia is suggesting is all about slowing down Russia's retreat so they can spend more time in occupied areas through the winter.
The winter is certainly coming, and it's unclear as to whether this partial mobilization will effect any change on the battlefield here before that. Although there has been a remarkable success by Ukraine overnight.
While talk was on partial mobilization in Russia and Putin's nuclear threat, they affected a prisoner exchange, where Russian prisoners of war, including one important man, Viktor Medvedchuk, the godfather to Putin's child and a key player in Ukraine politically before the war, arrested by the Ukrainians in April as a collaborator with Russia, well, he was swapped for 200 of the defenders of the Azovstal steel plant, Ukrainian soldiers who not only fought in Mariupol to defend that steel plant over weeks.
Remarkable pictures as they come back to Ukraine, to their families, and Ukraine celebrates those as heroes while Russia gets back one influential individual. A remarkable move there by Kyiv.
But still a very tense week ahead here. These four referendums coming. They're likely to obviously declare that they want to become part of Russia, and that puts pace now as the key question on the battlefield. Can Ukraine change what's happening here before winter, before Russia decides to change its battlefield tactics or use these new recruits -- John, Brianna.
BERMAN: Our thanks to Nick Paton Walsh in Sloviansk. You could hear the air raid sirens on behind him.
We're going to have new reporting coming up at 7 a.m. about the Russian military and their strength as they try to bolster their forces for this invasion of Ukraine.
So after suggesting the Sandy Hook massacre was a hoax for years, conspiracy theorist Alex Jones prepares to take the stand at his civil trial.
The Federal Reserve raising interest rates to the highest level in 14 years. How this latest boost might help tame inflation.
(BEGIN VIDEO CLIP)
(END VIDEO CLIP)
KEILAR: That is growing anger in Iran that is spreading in the streets. Protesters seen burning head scarves as Iranians see widespread Internet blackouts amid the unrest.
BERMAN: And we'll talk about that.
So the Federal Reserve making history, approving a 75 basis point hike for the third consecutive time this year. They've never done three in a row. This is the highest the Fed rate has been since 2008.
Federal Reserve chair Jerome Powell said the aggressive move was needed to fight inflation, even if that means pain for Americans nationwide.
(BEGIN VIDEO CLIP)
JEROME POWELL, FEDERAL RESERVE CHAIRMAN: If we want to set ourselves up, really light the way to another period of a very strong labor market, we have to get inflation behind us. I wish there were a painless way to do that. There isn't. (END VIDEO CLIP)
BERMAN: All right. With me now, CNN chief business correspondent, Christine Romans and CNN business correspondent, Rahel Solomon. So 75, three times in a row, and not just that, Romans. He said there's more.
CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: There's more coming. And you know, Jerome Powell, mild-mannered economist there, probably holds more control over your standard of living than anybody else in the world right now, and that's because jacking up these interest rates is going to be felt in your home loan, in your car loan, in the jobless rate essentially.
The Fed wants to see the jobless rate rise a little bit so that they can try to -- to kill this terrible entrenched inflation.
So this is a really, really big deal that will mean money in your pocket, money in your 401(k), your standard of living. This is just -- It's really historic, and more is coming, because you know, inflation is still too hot. The job market is still too strong, and the Fed has admitted that there's a lot more work to be done.
RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: And I want to just draw your attention to that chart we just showed, which showed interest rates at about 2.5.
Well, after yesterday, they're now actually higher than three. And what we learned yesterday is that they're probably going to be closer to 4, 4.5 percent, perhaps even 5, according to some projections next year.
So to Christine's point, what we have seen, we're going to see more of, which means that credit card rates could continue to go up, which they already have. Which means that auto loans could continue to go up.
So what this means for people at home is you want to prepare for that, right? If you can transfer your balance on your credit card, you want to do that.
The labor market could be changing. We could see job vacancies, right? We could see less demand, rather, for workers. That's something that, as a worker, you want to be mindful of as you're making career decisions, because this is something that we're not just going to be dealing with today, probably not even just next year but probably for years to come in terms of the aftermath.
BERMAN: Yes, look, credit card debt is going to kill you as these rates go up more and more.
All right. Jerome Powell and the Fed for years has said their target inflation rate is 2 percent. Why is that so magical?
ROMANS: It's kind of a Goldilocks number, because you don't want it less than that; because you don't deflation. That's very bad and dangerous, too.
BERMAN: Very bad.
ROMANS: You don't want it too much more than that, because you don't want consumer behavior to change, because you're buying something now because you think it's going to be more expensive later.
Two percent is sort of the Goldilocks number. And all the big central banks, frankly, have that 2 percent target.
We're really far away from 2 percent: 8.3 percent CPI in August. And we've seen gas prices declining, and that's been really good on household budgets week over week. But inside those CPI numbers we've seen sort of a spreading out of -- of underlying inflation.
SOLOMON: Other prices, for sure.
ROMANS: That's worrisome.
SOLOMON: And in addition to the concern about inflation becoming entrenched, right, and folks perhaps buying more today, because they think the price is going to go up, the Fed is also very concerned about a wage price spiral.
For example, if you start to think, you, John Berman, start to think, or Christine or myself, start to think that 8 percent inflation will be around for years, well, then maybe we go to our boss and say, Look, I need an 8 percent raise because --
BERMAN: Yes, I'm not doing that right now. Aside from that --
SOLOMON: Nor am I. Well played. But you know, you might start to think I need an 8 percent raise, because I'm going to have to be dealing with this 8 percent inflation for years. And that becomes a harder problem to solve, because then perhaps employers start to pass it to consumers, so it becomes a vicious cycle. And the Fed is trying to avoid that.
BERMAN: And that's one of the things that's hard for people to wrap their heads around, around this economy. Which is that you would think that, as an individual worker, I want to be paid more. But from the macroeconomic sense --
SOLOMON: Good point, yes.
BERMAN: -- a lot of these trends are tough. It will hold the whole economy back.
ROMANS: And look, the job market remains so strong. The Fed chief was talking less about the unemployment rate and more about the quits rate. People who can quit and get another job at a higher pay.
Also talking about there are two available workers -- or two available --
SOLOMON: Vacancies, yes. ROMANS: -- vacancies. You know, that's, like, a big number that he's worried about showing just how tight it is.
I think what we learned yesterday -- and we've been -- we knew this, but learned it explicitly yesterday, is that the Fed thinks that a little more joblessness is less dangerous than entrenched inflation. They'll take -- and I've heard many people say a little technical recession with higher joblessness is better than inflation that we have to battle for years.
SOLOMON: The lesser of two evils, almost.
BERMAN: By design. You know, people need to know that that's -- they're, in a way, trying for this. They don't want it to be bad, but that's the goal here.
Christine Romans, Rahel Solomon, great to see you both. Thank you.
SOLOMON: Nice to see you.
BERMAN: Hurricane Fiona is this year's strongest Atlantic storm, but there could be another big threat brewing. We'll tell you where it's headed, next.
KEILAR: Plus, Alex Jones set to take the stand in his defamation trial for calling the Sandy Hook school shooting a hoax, after a day of emotional testimony from families who lost loved ones in the massacre.
BERMAN: A new storm system is brewing in the Atlantic with an eye on the U.S. Gulf Coast. This is Hurricane Fiona, which is now a Category 4 storm. Moves North toward Bermuda.
Let's get right to meteorologist Chad Myers. A lot going on all of a sudden, Chad.
CHAD MYERS, CNN METEOROLOGIST: Yes. And all of a sudden, the storm that you're talking about will likely be named Hermine.
Here is Fiona. Gaston is up in the North Atlantic. We got rid of the "G" storm there.
But here's Fiona. right now a Category 4, 130-mile-per-hour storm in the Atlantic. Not going to make a U.S. approach, but it will certainly a Canadian approach in the Canadian Maritimes up there in Atlantic Canada.
This weather brought to you by Safelite, your vehicle glass and recalibration experts.
So even though Fiona does technically miss Bermuda, and then on up toward Nova Scotia, into Newfoundland, that area up there, probably a 100-mile-per-hour storm still this far north.
What's going to happen? It's going to be a wave story for Bermuda. These waves here will be 30 to 40 feet. And even from the Atlantic coast of the U.S., between 7- and 11-foot surge with waves just pouring on. Not storm surge, just waves.
High surf advisories here. It's going to be a good weekend to stay out of the water here.
There's the storm we're talking about for next week. This is still six days away. But the models are in very bad disagreement on where this thing goes. Going to have to keep watching that storm.
MYERS: It's still six days away from the Gulf, but we know it's there.
BERMAN: That spaghetti model, though, does put it in the Gulf. Some of it does.
MYERS: It does.
BERMAN: So it bears watching, for sure. Chad Myers, thank you.
MYERS: You're welcome.
KEILAR: This morning new emotional testimony in the defamation trial against Alex Jones. Families who lost loved ones in the Sandy Hook school shooting describing the pain and the fear of threats they received after Jones spread the lie that the massacre was a hoax.
Today, Jones is set to make his first courtroom appearance and take the stand.