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Quest Means Business
Protesters Await Trump in El Paso; Three American Tourists Drown in Turks and Caicos; Pakistan Suspends Bilateral Trade with India. Aired 3:05- 4p ET
Aired August 07, 2019 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:05:04] ZAIN ASHER, CNN INTERNATIONAL HOST: All right former Vice President Joe Biden speaking there in Burlington, Iowa deliver remarks for
his campaign rally. He essentially delivered a scathing remarks of the President, scathing message to Donald Trump saying that the President has
used language that has racist undertones, that we are essentially in a battle for the soul of this nation and that he has sowed extreme amounts of
division within this country.
He claimed that the President had fanned the flames of white supremacy, and that the President sympathized more with segregationist like George Wallace
than George Washington.
He ended on the note that this country cannot allow Donald Trump to be reelected and also said that if Donald Trump is reelected, it will
fundamentally change who America is in terms of identity.
Donald Trump is actually due to land in El Paso, Texas this hour to visit the scene of last weekend's deadly mass shootings.
Take a look here. You're looking at live pictures of protesters who are already gathering there in El Paso, Texas just before he lands.
Tonight, though with America in mourning, Donald Trump is attempting to play Consoler-in-Chief. The U.S. president left Dayton, Ohio a short time
ago and that is where nine people were killed by a gunman. The motive still remains unclear at this point. Mr. Trump was greeted by a mix of
protests and supporters there.
This hour, as we mentioned, he is going to be landing in El Paso, Texas. That is, of course the border city where a white supremacist targeted
Latinos killing 22 people in a Walmart. The gunman posted a manifesto tied to similar themes about immigrants found in the President's own rhetoric.
And that is something that Joe Biden also touched upon in that speech. Protests, as you mentioned, are already underway.
The President called for unity in the wake of these shootings. This morning, he himself returned to partisan attacks. A source familiar with
internal discussion says the White House is looking at ways to tighten up background checks through some sort of executive action, so far, there are
a few details.
The Mayor of Dayton says she doesn't expect things to change.
(BEGIN VIDEO CLIP)
NAN WHALEY (D), MAYOR OF DAYTON: I pointed out to the president that now Governor, former Senator Mike DeWine voted for the assault weapons ban.
There was a time when this was bipartisan.
And so we're looking for those people and Congress to come together because the majority of Americans agree. So this should be an action. Do I think
that we're going to see another mass shooting tomorrow or Friday? Probably because Washington will not move.
(END VIDEO CLIP)
ASHER: Brynn Gingras is in Dayton for us. Brynn, just walk us through what the scene was like in Dayton, Ohio earlier today when the President
visited that city?
BRYNN GINGRAS, CNN CORRESPONDENT: Yes, that's right, Zain. I mean, he was here on the ground in Dayton for three hours. He was met by protesters,
both in favor of him coming to the city, and also those who wish he didn't come at all.
He did start his visit talking to first responders and he went to the hospital where there are still some victims of this shooting that happened
right behind me, who are there still recovering, and he did talk to those families.
According to his spokesperson, there was absolutely no political talk that took place during his visit here in Dayton. It was really about "how are
you doing," and just sort of well-wishing and not really getting into a conversation about gun control or racism.
But I can tell you that that is certainly on the minds of people who live here in Dayton now. You're not seeing it now, but when he was here, this
entire street was lined with protesters, again on both sides of the aisle.
And it didn't necessarily have to be someone who was a voter of Trump or a non-voter of Trump, it's really the general feeling was just, you know, was
it the best idea for him to come? Because this is about the victims.
This is a town, a city that is still recovering in their eyes. And that was something that we saw really across the board, even from businesses
lined up around here is please just go away, because we just want to grieve, we want to remember those who lost their lives here and who are
still going through so much change in their life.
And then the bigger picture, they want to see change. They don't want the President to come here, and then tomorrow, it is the same thing, the same
sort of conversation that goes nowhere when it comes to guns or even his rhetoric that's been criticized, certainly here.
And so that's really what we saw and now that he has left, it has quieted down. People are really just trying to get back to some normalcy if that
even is existing.
ASHER: And Brynn, he -- you know, he sort of lashed out at the Mayor of Dayton, you know, he returned to sort of various political jabs. Is that
sort of behavior now come to be expected from the President, even when he is visiting a town that is key in the mourning?
GINGRAS: Yes, I think there are certain people that they don't -- nothing fazes them, right. They're never surprised.
[15:10:10] GINGRAS: That was something that was on the minds of some of the protesters we talked to, it is like, "You're not our president. You
say horrible things." While investigators say this particular shooting was not fueled by racism, it was fueled by what they believe is a different
ideology.
It's still in their minds, this happened at a bar that is frequented by black people. It is popular and most of the victims were black victims.
So for people here, that hit home.
And yes, it's certainly on the mind of people about his rhetoric, and will that change? There are other people who are Trump supporters and they're
completely okay.
I mean, we certainly have those people who we see at his rallies who are completely okay with how the President handles his country, and don't want
to see change at all.
ASHER: All right. Brynn Gingras live for us there. Thank you so much. We should actually also remind our viewers, the President is set to land in
El Paso, Texas in about half an hour. So from now we'll bring you those images as and when we get them.
Let's turn to the market. It's been another dramatic day of trade. The Dow is actually trying to erase the day's losses. We actually were down at
one point earlier this morning, nearly 600 points. It was earlier in the session.
The NASDAQ is in positive territory. You can see the Dow though has recovered from earlier losses, it is down 75 points or so, pretty much
flat. The S&P 500 is also flat as well.
Investors were reacting to a series of warning signs. First interest rate cuts in India, New Zealand and Thailand. Central Bankers are trying to
keep the U.S.-China trade Ward from damaging their own economies. Second of all, U.S. bond yields, they fell dramatically as investors traded in
their stocks for the relative safety of government debt.
The yields on the U.S. 10-year actually dropped to its lowest level in three years that has actually now stabilized pushing stocks higher; and
third of all, gold prices, the quintessential safe haven despite their highest level in six years. Gold is actually up 17 percent so far this
year.
Art Hogan is Chief Market Strategist for National Securities. He joins us live now. So, let's talk about what the Dow did today. We're down 600
points at one point. Yesterday, we seemed to do pretty well, it was a good day on the market. Monday was obviously atrocious.
But when you think about these sort of yin and yang, these sort of red days and green days, are those sort of bounces going to become more common going
forward, do you think?
ART HOGAN, CHIEF MARKET STRATEGIST, NATIONAL SECURITIES: Yes, I think we're at a point where there's so much unknown about the U.S.-China trade
war. We've flown into that zone where we really don't know what the end game looks like, very much like we were in the entire month of May and
casts this kind of volatility.
So I think framed it up perfectly, Monday was a terrible day, we bounced back a little on Tuesday. Today was both of those days combined. We were
off much overnight and in the morning, and we bounced a little bit.
I think the different flavor to today is actually -- which you hit right on the head -- was some Central Banks actually stepping up and saying, "You
know what, the longer this goes on, the more the global economy is going to slow." The longer we have a U.S.-China trade war, the slower the economy
is. The more we have to get aggressive with monetary policy. We're doing that ourselves in the United States, and that's dragging down yield. So,
we'd see the 10-year --
ASHER: The only difference is that when the Fed cuts rates, the market interprets that as a good thing. Stocks actually like that. They see it
as a positive sign. In fact, they actually want the Fed to cut rates even more.
When Central Banks around the world do it. They see that as a stark warning sign.
HOGAN: Very true, except for the fact that we shouldn't want our central banks to be cutting rates. We really shouldn't. That's a counterintuitive
place we get to when the Fed is in a cutting cycle. We think bad news is good news, and we celebrate that a little bit. And when the Fed cuts
rates, we celebrate that.
I think we're at a point now where we have to look at good news as being good news and bad news actually being bad. And that's -- what we have
right now is a lot of bad news.
We don't know how long the U.S.-China trade war is going to be. So therefore, the global economy slows more than we would like, therefore,
monetary policy is going to be easier than we would really like in a normal situation. And that's going to be a drag on earnings, and that's why we
buy stocks.
ASHER: We saw that report from Goldman Sachs saying that they anticipate that this trade war between the U.S. and China will last well until after
the election next year is over. If that happens, do you anticipate a recession? How close are we to a recession, especially with inverted yield
curves?
HOGAN: Right. If we actually escalate to the entire $550 billion worth of things that we buy from China, and go all the way to 25 percent on all of
that, and China retaliates with the kind of retaliation we've seen already, it will certainly drag the globe into a recession, and the U.S. will not be
immune to that.
There's no getting around the fact that the two largest economies in the world having a trade war, and the uncertainty that casts for the rest of
the world's economies is clearly going to slow the economy.
We've already seen it now and we're only halfway there. Right? So to go all the way? Yes, I would certainly believe this. Is there the ability
for both sides to come together and say, "You know what, we shouldn't have a mutually destructive trade war. It's hurting both of us."
ASHER: Right, right, right.
HOGAN: My guess that's going to be choreographed probably closer to the election, and maybe that helps or maybe it doesn't. The strange thing is,
the thing that the President said today that was shocking to everybody in the market was, "Yes, we expect this kind of damage in the market."
[15:15:07] HOGAN: Before, this has always been his report card, "Hey, look how great the markets doing. I must be a great President." Today, he
actually came out said, "Yes, we expected the market to sell off when we started getting aggressive with China."
And that had everybody thinking, right around lunchtime, "Wait a minute, our assumptions are wrong here." You know, the market moving like this
isn't going to take him away from this you know, long drawn out battle.
ASHER: It's very interesting. All right, Art Hogan live for us. Thank you so much. Appreciate it.
As the world straps in for trade war turbulence, Central Banks are racing to cut rates and keep their economies on an even keel. These are the
latest moves.
On Wednesday, India cut rates, the lowest level in nine years. Thailand made its first cut in four years. New Zealand cut twice as much as had
been anticipated. These are not isolated incidents. This map -- take a look here -- actually shows the moves made by the world's biggest Central
Banks this year, all but one have either held or cut interest rates.
In some parts of Europe, interest rates are of course negative. Economists are warning of all the risks that go along with low rates. Like an
airplane, Central Banks can lose altitude to gain speed. But when rates are too low; there's no room to maneuver, if the economy takes a downturn.
Second of all, lower rates can cause bubbles to form, notably in the housing market. In a downturn, those bubbles can burst and low rates also
punish savers as well and that can push them to invest in riskier assets, like stocks.
Let's talk about all of this with Fred Bergsten who is the founder of the Peterson Institute of International Economics. Thank you so much, Fred,
for being with us. So when you see three Central Banks in the same region almost simultaneously moving to cut interest rates, what message does that
send about the outlook for the global economy, do you think?
FRED BERGSTEN, FOUNDER, PETERSON INSTITUTE OF INTERNATIONAL ECONOMICS: Well, the outlook for the world economy is certainly a slowdown. There's
an old saying when the elephants fight, the mice get trampled.
The U.S. and China, the two biggest economies are in a trade war, both their economies are slowing down. That necessarily pulls the world economy
down, and the mice have to scramble and try to defend themselves.
The most direct way to do that is through easing their monetary policy. That's what we're seeing. I suspect we'll see it in other countries as
well.
I don't think that's a bad thing. None of those countries have very low interest rates, I don't think they'll run into kinds of traps you were just
talking about. So if they can preempt a turn down, a recession in their own economies, good for them. They will obviously hope this trade war ends
soon.
Does that continue to rattle them? But in the meanwhile, they're going to defend themselves. And I think we should be grateful for that.
If the rest of the world can keep the economy going while the giants continue to fight, that's a good thing.
ASHER: So what are the actual risks and dangers of, I don't know if I should call it a race to the bottom when it comes to Central Banks cutting
interest rates in this low rate low growth environment are about to enter into?
BERGSTEN: Well, because you've got low growth, lower interest rates are appropriate. The risk would be if there was an inflationary bubble, but
there's not much inflation in any of the countries we're talking about. Certainly not the world economy as a whole.
The usual risk from cutting interest rates -- a race to the bottom, as you call it -- would be igniting a blow off in inflation. But there's really
no sign of that to the contrary, in some of the markets here, in Europe, in Japan, inflation is nowhere to be seen. Deflation is a bigger risk. In
fact, the Central Banks would like to see inflation get higher. So I don't think that traditional risk is there.
The other big risk would be as you pointed out, the possibility of igniting financial bubbles. In some of the countries, equity markets are strong and
others are not so strong.
Again, I don't see any generalized risk from lower interest rates at this point. Think of it as a holding action of insurance, hoping that saner
heads prevail, particularly the United States, but also in China, to try to stop the trade war, which is really the event at the margin that is causing
this reassessment of global economic outlooks.
ASHER: Goldman Sachs came out with a report yesterday saying that they anticipate this trade war between U.S. and China will actually last until
after the election next year. If that is the case, how many more rate cuts would you anticipate from the U.S. Central Bank?
BERGSTEN: Well, I think that premise may be a little too pessimistic. I would not foresee any fundamental trade agreement before our election that
resolves the underlying issues which are pretty deep.
But I think it's quite possible there'll be a truce, or a ceasefire or some agreement, not to escalate the trade wars further, and maybe even to dial
back a little bit where we are now.
I don't think President Trump wants to throw the U.S. economy into a recession as he runs for reelection, mainly on the success of the economy.
I think he realizes that he is playing with fire by doing this, and so I would not assume as the Goldman Sachs premise says that there will be no
trade agreement at the trade wars will continue to escalate between now and 15 months from now.
ASHER: Well, we'll find out either way, Fred Bergsten, thank you so much. Appreciate it.
Strange Times at the house of the mouse, Disney has found a quote "photo success" and still somehow, they managed to miss on earnings. We explain
how that happened.
And we're going to be going live to Donald Trump's next stop, the border town of El Paso, Texas where protesters await Trump's arrival after
Saturday's mass shooting.
(COMMERCIAL BREAK)
ASHER: All right, welcome back, everybody. We are in the final hour of trading on Wall Street. The Dow is doing its best to get out of the red.
The S&P 500 and the NASDAQ actually both up -- take a look back for the day -- and investors are trying to look past the volatility that has plagued
the Dow for the past month triggered by trade worries and fears of a global slowdown.
Alison Kosik is joining us live now at the Exchange. So Alison, what a day at the Stock Exchange? We were down to 600 points at one point. Then last
time I checked, we were down like 72 points, and now we are flat and gearing towards possibly turning positive. What on Earth has happened in
the last half hour?
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Yes, something tells me this is the kind of pattern that we should probably get used to, at least for the
next few weeks. I'd say don't let the numbers fool you, Zain. The anxiety about the trade war and the uncertainty about when it's going to end, I
think that anxiety remains.
One trader putting it this way to me saying we're actually back in a 2008 currency war environment where Central Banks around the world moved their
rates toward zero or add zero, and by lowering rates countries are manipulating their currencies and, you know, he calls it the race to zero
and he thinks more and more Central Banks will be doing this.
Now, this trader goes on to say that President Trump has created, he literally ignited chaos with this last announcement of these tariffs on
$300 billion in Chinese goods and Trump's demands on Twitter for the Fed to lower rates that's causing even more anxiety.
So the big worry, despite the turnaround you're seeing now in the market, the big worry in the market is if this trade were drags on for another 12
to 18 months. It will chip away at the strong fundamental data in the U.S. and cause a recession.
So those are the kinds of fears that we saw stirring up the Dow earlier this morning when we saw the Dow fall about 600 points.
[15:25:15] KOSIK: You know what? We can't forget that what investors did. They piled into gold. They piled into Treasuries. Safe haven investments.
That didn't go away between this morning and now -- Zain.
ASHER: Alison Kosik, thank you so much. Appreciate it. Okay, so Disney is getting punished by Wall Street. The stock is down actually nearly five
percent since reporting quarterly earnings. Revenue missed expectations despite sales rising 33 percent from the same period last year.
Walt Disney said, "All our dreams can come true if we have the courage to pursue them." Disney certainly pursued some dreams last quarter at the box
office, "Avengers: End Game" became the highest grossing film in history and its steampunk division much anticipated the "Star Wars: Galaxy Edge"
opened its doors as well. And now CEO, Bob Iger is is unveiling a streaming plan designed to take Netflix head on. It will bundle Disney's
streaming library with new shows on Hulu, and live sports from ESPN.
I'm out of breath after saying all that because Disney is working on so much. Paul La Monica is joining us live now. So Disney has obviously had
massive success at the box office. But just in terms of its overall strategy, its success comes with a lot of spending. Surely investors must
understand that.
PAUL LA MONICA, CNN BUSINESS REPORTER: Yes, I think investors realize that Bob Iger is spending a lot both on the streaming plans as well as the
recently closed deal to acquire a lot of those Fox assets.
But Disney is a stock that had gone up more than 25 percent this year. So I think this sell off, you have to put it in context a little bit.
Expectations were extremely high. And the numbers while good were maybe not as dare I say, magical, as investors might have been hoping for.
But make no mistake, obviously, this is a company that has huge box office hits already with "Avengers: End Game." They're coming later this year
with "Frozen 2." You're going to have the "Star Wars: Episode IX. The Rise of Skywalker." Both of them are likely to be gigantic hits at the box
office.
But you know, the theme park business, they're spending a lot. There are these new attractions like Galaxy Edge, which sounds fantastic, but maybe
they're spending a little too aggressively and the payoff is going to come a little bit more down the road.
It sounds like people might have been holding off on visiting the Orlando theme park until all of those "Star Wars" attractions are in place that
might have hurt results in the current quarter.
ASHER: One thing that Disney does have to look forward to is Disney Plus, you know, depending on what your views are on how well they can compete
against Netflix, the land is quite saturated when it comes to all of these streaming services. What does Disney have going forward?
Obviously, it's quite an amazing library of content, but also they're coming in quite cheap. It's going to be $12.99 for a bundle -- ESPN Plus,
Disney Plus and Hulu -- that's quite remarkable.
LA MONICA: Yes, it's a very good value, I think for consumers that might want all three of those different services. Disney Plus on its own was
priced at $6.99, which is obviously very compelling compared to Netflix.
ASHER: How do they -- I mean, how do they intend to make a return on that?
LA MONICA: I think it remains to be seen how they're going to make a return on this, but obviously having the bundle as well, you'd have to
think that Bob Iger is hoping that people that are interested in all those Marvel shows that are going to be coming to Disney in the coming years, a
lot of which are leaving Netflix that they may also want the Hulu content, albeit with ads because it's important to note that the Hulu part of this
bundle will have ads.
And then ESPN as well, if you are a sports junkie and want to watch Sports Center, Baseball Time, many of the other sports shows and live events on
ESPN, as well as all those movies, $12.99 a month is a pretty compelling prize.
ASHER: Isn't it say tempting?
LA MONICA: Right. But then it becomes -- it begs the question, "What if you still like 'Stranger Things' on Netflix?" For example, all of a
sudden, you're paying $12.99 for Netflix, $12.99 for Disney Plus, it all adds up?
The next thing you know you're you know what? $50.00 or $60.00 a month on streaming? Sounds like cable to me.
ASHER: Yes, they might end up picking one. But they offered guidance on the fact that the Fox deal is likely to weigh on profits for some time --
for a continued amount of time. I mean, how long do they think that they can actually -- I mean, how long until they get out of that, do you think?
LA MONICA: Yes, I think it's going to take a couple of quarters for them to fully absorb all those assets from Fox and to make sure that they really
fit within the broader Disney Empire, which a lot of that is going to be streaming, I think as well.
But Fox is certainly weighing on Disney results right now and again, you can't stress enough, I don't think this is a case of Disney doing poorly.
But the expectations were to the moon, when you wish upon a star, you didn't exactly get to the star with these results.
ASHER: Right, Paul La Monica, thank you so much. Appreciate it.
After the break, President Trump is about to arrive in El Paso, Texas. Some in the Texas City say he is simply not welcome.
(COMMERCIAL BREAK)
[15:30:00] ZAIN ASHER, HOST, QUEST MEANS BUSINESS: In Texas -- some in the Texas city say he is simply not welcome.
(COMMERCIAL BREAK)
ASHER: Hello everyone, I'm Zain Asher, there's more QUEST MEANS BUSINESS in a moment when Pakistan suspends all bilateral trade with India as their
dispute over Kashmir gets ever more tense. And investors are rushing to the safest of safe havens, gold prices hit a six-year high. Before that
though, these are the headlines at this hour.
Canadian authorities say they believe they have found the bodies of two men suspected of killing a road-tripping couple and university teacher. The
bodies of the suspected killers were found in the bank of the Nelson River, an autopsy is being scheduled to confirm the identities of the bodies and
to determine the cause and the manner of their death.
Authorities in Greece say they found the remains of a missing British scientist. Natalie Christopher reportedly never returned from a run one
day on Ikaria Island where she was vacationing with her partner. Police say her body was found in a ravine, an autopsy will be conducted to
determine how exactly she died.
Three American tourists including a married couple drowned while vacationing in Turks and Caicos. After an extensive search, two bodies
were found Monday and another on Tuesday, authorities say the deaths result on a fast-moving tide.
And severe storms are causing long delays at major U.S. airports in the Northeast, roughly 700 flights have been cancelled. The wait time at New
York's JFK Airport is over 5 hours. Delays are also reported in Newark and LaGuardia as well as airports in Boston, Philadelphia and Washington D.C.
British Airways says it's fixed a computer crash that forced it to cancel or delay hundreds of flights. Travelers face long lines at Heathrow and
Gatwick Airports as the airline works to rebook everyone. No word on what exactly caused the breakdown.
[15:35:00] Donald Trump is expected to touch down in El Paso, Texas, shortly. The president is expected to meet the families or the victims of
a tragic shooting there over the weekend. It was his second stop of the day. Earlier, Mr. Trump met with families and first responders after
another shooting in Dayton, Ohio.
CNN's Nick Valencia is in El Paso waiting for the president's arrival. So, Nick, I'm assuming those are protesters behind you, judging by those
images, it's pretty clear what sort of welcome the president is set to receive there.
NICK VALENCIA, CNN CORRESPONDENT: The message of this rally is very clear, Zain. In fact, the organizer of this rally, Fernando Garcia with the
Border Human Rights Network just went on the stage to say that President Trump is to blame. He said he wanted to be clear and send that message,
and then the crowd started to chant in agreement.
We're going to hear two messages here today I'm told from Fernando Garcia. One is a message of resilience in this community that this alleged shooter
came here to specifically target Latinos. They believe that this was a blatant racist attack simply because of the color of someone's skin and
their nationality, their ethnicity, who their parents are, who their children are, and what they mean to this country.
They feel as though President Trump through his rhetoric, through his rallies the last two years from the White House, the highest office in this
country, that he bears part of the blame even if his supporters disagree and unwilling to admit that. Let's be clear that President Trump does have
supporters here, and we saw that at a rally here in February.
But I also want to be clear, Zain, that no one who I've spoken to -- and I've spoken to dozens of people here, both conservatives and Democrats. No
one wants him here, no one believes that now is the time for him to come here and heal because he's never shown an example of that, I'm told.
People here know that Americans have become numb to mass shootings, they know that those may see these headlines, see the double-digit number of
fatalities and turn the other way because they're just simply tired or they don't have the room in their heart, the capacity for the pain that it is to
see this crime happen time and time again.
But they want to be clear here about something that this is different. This was a direct targeted attack on Latinos in this country, and that the
rhetoric that the president has used has been divisive. They tell me that President Trump didn't create hate, fear or racism, but he's used those as
tools to divide the nation.
Here, this rally is about unifying, this rally is about uniting the community. Earlier when I spoke to Fernando Garcia, he says, clearly,
President Trump is not welcome here. I asked him if he's doing the same thing that he accuses the president of doing, of not welcoming certain
people, he says, this group is not to blame, that the president bears all of that responsibility. Zain?
ASHER: So, Nick, is there anything -- I mean, listen, it's no secret that some of the shooter's rhetoric did echo the president. Is there anything
the president can do at this point when he arrives in El Paso to actually show the community that he does care and that he is -- he does want to
console them?
VALENCIA: That's a great question, Zain, and earlier, I read a report from one of the family members who was directly impacted by this. One of the
family members was injured in this shooting, and they told the reporter that they want President Trump here because they want to see if he's
genuine or not.
That's the only voice so far that we've been able to tell that is vocal about wanting the president here, but it's simply because they want to look
in the president's eyes to see which president are they going to get? Are they going to get Donald Trump who reads off the teleprompter and sends a
message to the nation that this is a time to heal and come together or are they going to get the tweeter-in-chief, the president that uses his Twitter
account to try to divide this nation.
These are the words of the locals here, the locals in this community that are angry. They're in shock, they're in pain and sometimes that emotion --
those emotions all happen at the same time, Zain?
ASHER: All right, Nick Valencia live for us there, thank you so much, appreciate it. The mass shooting in Texas has brought the community
together. Large numbers of people showed up to donate blood for victims after the massacre. CNN's Gary Tuchman spoke to some of them.
(BEGIN VIDEOTAPE)
GARY TUCHMAN, CNN CORRESPONDENT (voice-over): The response was immediate when people in the El Paso area heard blood donations were needed following
the shootings at Wal-Mart, they turned out in huge numbers. Eighteen-year- old Adrian Gladzick(ph) has never given blood before.
UNIDENTIFIED MALE: I just feel that I need to do my part in the city that I grew up in my whole life.
TUCHMAN: Sarah Spencer just moved to El Paso from New Jersey.
(on camera): How did it make you feel when you heard what happened here?
SARAH SPENCER, EL PASO RESIDENT: Devastated. I started crying.
TUCHMAN: How does it make you feel now that you're sitting in this chair giving blood and helping people?
SPENCER: Wonderful.
TUCHMAN (voice-over): In this mostly Latino city, many tell us they are stunned at what happened here, and also stunned at the fact the shooter
appeared to be targeting Latinos.
[15:40:00] UNIDENTIFIED MALE: It makes you angry, it really does, sometimes you know, it makes you cry, you know, sometimes the day it
happened, I just -- I just cried because of the anger.
TUCHMAN: Jean and John Moore are from England, but are now dual U.K.-U.S. citizens. Before moving to Texas, they lived in Colorado.
JEAN MOORE, EL PASO RESIDENT: When we lived in Colorado, we lived through columbine, so, this isn't the first massacre that we've experienced, and
unfortunately, nothing much changed.
JOHN MOORE, EL PASO RESIDENT: It is a blight on the nation, essentially, in my opinion.
MOORE: I'm a school teacher, so, when I walked into classrooms and I saw children from different ethnic backgrounds, I really felt and still feel
that diversity is the strength of this country, and so I'm here to support that diversity.
TUCHMAN: Supporting diversity. One of the reasons everyone we talked to was proud to be donating. Gary Tuchman, CNN, El Paso, Texas.
(END VIDEOTAPE)
ASHER: Australia used to grapple with mass shootings before a turning point in 1996. Thirty five people were killed in a popular tourist bar
with a semi-automatic rifle. The governor restricted guns access just days later. Earlier, Julia spoke with former Australian Prime Minister
Kevin Rudd who urged the U.S. to follow a similar path.
(BEGIN VIDEO CLIP)
KEVIN RUDD, FORMER AUSTRALIAN PRIME MINISTER: As a friend now of the United States, I would just appeal to the president of the United States to
demonstrate leadership by banning all semi-automatic weapons in the United States of America. We did that in Australia, in fact, my conservative
predecessor Mr. Howe did that and with bipartisan support from us, and it's had a huge effect in Australia so far, in frankly, removing these mass
shootings from our day-to-day, you know, political experience.
That needs to happen in America. It won't solve all gun violence, but mass shootings where you can kill 30 people in, you know, 60 seconds, there's
only one way to fix that, ban semi-automatic weapons. Why for -- on God's earth does anyone need a semi-automatic weapon other than being a member of
the United States military?
There's no rational need for this. It should happen -- I'd call on the president of the United States to take action. I'm sick and tired of
hearing American political leaders offering their thoughts and prayers. I go to church too, but you know something, going to church and praying is
well and good, but banning semi-automatic weapons, that's real action, and that's what needs to happen.
(END VIDEO CLIP)
ASHER: And a quick programming note for you, CNN's Chris Cuomo will host "AMERICA UNDER ASSAULT: THE GUN CRISIS" live town hall as at 9:00 p.m. here
in New York, 9:00 a.m. if you're in Hong Kong and that's right here on Thursday on CNN.
Rocky markets have investors desperate for something stable. Gold is the new standard and it's as precious as ever. A look at its record rise,
next.
[15:45:00] (COMMERCIAL BREAK)
ASHER: All right, it's been threatening to do it all hour now, it has finally happened. The Dow has actually turned positive. Remember, we were
actually down roughly around 600 points at one point now, it's flat, but still, it eked out a very slight positive gain. We've got like 15 minutes
until the closing bell.
We'll stay -- oh, just finished negative territory again, you see so much volatility there and investors are certainly fearful of a global slowdown,
and are still ditching volatile stocks for a safer, shinier harbor. I'm talking about gold. It's a rush that sent prices to a 6-year high over
1,500 an ounce, central banks got into the action too, buying a record $15.7 billion worth of gold in the first six months of the year.
Clare Sebastian is with me now. So, Clare, we haven't seen this level, just in terms of gold in years. Gold is up about 17 percent so far this
year, but if you take a look at the market, it's sort of all over the place today. We were down 600 points, at one point now, it's eking out positive
gains.
CLARE SEBASTIAN, CNN BUSINESS REPORTER: Yes, I mean, if you asked me this a couple of hours ago, I would have said classic flight safety, you've got
the global growth concerns around the world, you've got the three central banks cutting rates today. You've got trade uncertainty that doesn't show
any sign of abating.
In fact, it's gotten worse in the last week. So, this does look like people getting into the safe haven, gold of course, holds its value, so
it's very popular in terms of uncertainty, but stocks are not going away either, clearly, they're incredibly resilient, perhaps, this is part of
the, you know, bad news is good news, does this mean more rate cuts on the horizon?
And that's why we're seeing some resilience, but I think if you also look at the stocks that are rising today, it's the consumer staples, it's like
Walgreens, we see, you know, VISA, McDonald's, things like that, but they pay dividends or they're more stable, a bit less cyclical. So, I think
there's more a sense that people are kind of rotating their portfolios perhaps rather than a wholesale dumping of stocks.
But at the same time, of course, moving in to gold, and I think if you look at the 10-year chart, it really tells a story. We haven't really seen this
kind of rise since, you know, the kind of heady days after the global financial crisis, so it is quite stark.
ASHER: And it is not just gold that is benefitting from the volatility. You've got silver, bitcoin, of course, treasury yields as well. Just walk
us through what's going on.
SEBASTIAN: Yes, treasury yields is the big story today, not just Treasuries because we have bonds around the world. Yields befalling that
signals, the demand for bonds is rising as people shift out of stocks, bonds that are traditionally seen as safe.
Fifteen trillion dollars, Zain, is the amount of bonds around the world that yield negative, which means that you actually lose money if you buy
those -- so intent on people getting out of the riskier assets into safer havens. And bitcoin, of course, I mean, it says something --
ASHER: Well, wild ride --
SEBASTIAN: Right, when one of the most speculative assets out there is actually showing some resilience today, a spike over $12,000 earlier. So,
yes, sign of the times.
ASHER: When you think about the fact that gold is up 17 percent so far this year, and you know, what's happening with the rising tensions in terms
of trade with the U.S. and China, and you look at all of that fear and what's happening with gold rallying, precious metals rallying, is the fear
justified?
SEBASTIAN: I mean, I think yes, in a lot of ways. We are now in a situation where a lot of economists are looking, you know, further out,
saying that this is -- this is really not going to get resolved any time soon. Goldman Sachs, we've quoted this multiple times that --
ASHER: Right, 2020 --
SEBASTIAN: You know, before the 2020 election, there doesn't seem to be a huge amount of impetus on either side to come to the table. We've got
multiple elements that kind of A, so much for retaliation coming to the fore from China, be it the depreciation of the yuan, be it stopping
agricultural purchases.
There are more things they could do and meanwhile, Trump saying again today that, you know, China has been cheating the U.S. economy for many years,
he's not backing down either. So, I think, you know, there's some resilience in stocks that probably has more to do with the Fed, but in
terms of the simmering China-U.S. trade war, and the fact that these are the two largest economies in the world at each other's throats, that is
very serious though.
ASHER: And it's been simmering to the false promises, we're thinking that we're close to a truce and then not really --
SEBASTIAN: Yes --
ASHER: Who knows what's going to happen next. Clare Sebastian live for us there, thank you so much. All right, still to come tonight, the stakes
rise in a dispute over Kashmir, we'll have the latest and the deteriorating relationship between India and Pakistan, that's next.
[15:50:00] (COMMERCIAL BREAK)
ASHER: Right now to a major escalation in the long-running tension of the disputed Kashmir region. Pakistan is downgrading diplomatic ties and
suspending bilateral trade with India, one of its biggest trading partners. It comes after India stripped the state of Jamur and Kashmir of the special
status.
Ravi Agrawal joins us live, he is the managing editor of "Foreign Policy Magazine". Ravi, thank you so much for being with us. So, just explain to
us what the consequences, the economic consequences of this move actually is, because Pakistan depends more on India for trade than vice versa. So,
is this -- does this move, meaning that Pakistan is in a way shooting itself in the foot?
RAVI AGRAWAL, MANAGING EDITOR, FOREIGN POLICY: Well, both sides are going to hurt. I mean, India is -- has a larger, more diversified economy, so it
could weather that storm better than Pakistan could, but both sides are going to hurt. That said trade between the two countries is not that great
to begin with because they've had so many long-running problems for years and years.
And so it's a very under-developed trade relationship as you would imagine between two countries that have been at war several times over the last few
decades. That under-development has been bad for both countries, and this will make it worse.
ASHER: So, just in terms of how this gets resolved. I mean, as the -- I mean, the U.S. doesn't seem to necessarily be that interested in sort of
mediating this dispute. Will it end up at the UN, how does that work?
AGRAWAL: So, India has a stated policy of Kashmir being an internal security issue, and that it will under no circumstances accept any
arbitration by any third power or the United Nations. So, for India, that's an absolute no-go. The United States knows that and it's not going
to try to intervene.
Last month when Imran Khan; Pakistan's Prime Minister was in Washington, President Trump actually mistakenly said that he would be happy to mediate
in the Kashmir conflict, but India back-channeled and said, well, there's no way we would accept that, and Trump's claim that Modi had actually asked
Trump for his help for mediation turned out to actually be untrue because Modi now says that he didn't ask for any help to begin with.
So, in terms of resolution, this is going to stay as a problem between these two countries. India is going to say that the action it took was
within the part of Kashmir that it controls, which is Indian-administered Kashmir. Pakistan has claims of all of that land, but it wasn't actually
controlling it. So, it's more likely that the status quo will just continue, India will get to do what it has done within its territory and
Pakistan won't have much impact.
[15:55:00] ASHER: You mentioned that trade between the two countries isn't that great, but it is more likely to hurt Pakistan than India.
Still, this comes at a time when the Central Bank in that country has obviously cut interest rates. What does that tell you about fears in the
region when it comes to slowdown in terms of local economies?
AGRAWAL: There are growing signs that India's economy is not in great shape, and those signs range from unemployment being at a 30-year high to
the growth rate having slowed down considerably to about 5.8 percent in the last quarter. India was hitting upwards of 7 percent just about a year, a
year and a half ago.
So, there's been a slow-down of sorts in India, but there are other signs, car sales are down dramatically by about 30 percent in India. So, there
are signs that people just start spending as much and that's why the Central Bank cut rates by 30-basis points, so a little bit more than a
quarter point cut to about 5.4 percent.
The question is, is that really going to change anything, and the jury is out on that because Indian banks have not been cutting their rates in that
the Central Bank is cutting its rates, but regular banks aren't passing on those cuts to people. So in that sense, it hasn't really changed much so
far over the last few cuts.
And the Central Bank actually signaled that it will cut rates again when it meets in October. So, all signs point to India hitting a bit of a slowdown
and needs to figure out ways to ramp-up job growth, most of all.
ASHER: Well, it certainly had effect on U.S. markets, who were down about 600 points at one point here because of the move by Central Banks in that
particular region moving to cut rates. Ravi Agrawal live for us there, thank you so much. There are just moments left to trade on Wall Street,
we'll have the final numbers and the closing bell for you right after this.
(COMMERCIAL BREAK)
ASHER: All right, there are just moments left to trade on Wall Street, what a comeback we have seen. The Dow is actually now up ever so slightly,
momentarily pulling its way back out of the red, you can actually see a sliver of green at the edge of the screen there after being down some 600
points earlier this morning local time.
Yes, you have a 100 and the Nasdaq above, actually up for the day, the volatility has been triggered by trade worries and fears of a global
slowdown. Let's take a look at the Dow components specifically, Disney is weighing on the index, the stock is down nearly 5 percent since reporting
for the earnings, revenue missed expectations despite sales rising 33 percent from the same period last year.
OK, that is QUEST MEANS BUSINESS, I'm Zain Asher in New York, I'll be back tomorrow, the closing bell is ringing on Wall Street.
(BELL RINGING)
The Dow is just about in the red, "THE LEAD" with Jake Tapper starts right now.
END
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