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Hala Gorani Tonight
Charges in the French Train Attack; Sigh of Relief on Wall Street; Interview with Foreign Minister of Macedonia. Aired 3-4p ET.
Aired August 25, 2015 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:09] HALA GORANI, HOST: Tonight charges in the French train attack.
(BEGIN VIDEO CLIP)
GORANI: Authorities there say the evidence points to terrorism.
Then a tentative sigh of relief on Wall Street as we countdown to the closing bell. Find out why global stocks are rallying after another tough
day in China.
Plus I'll ask the Foreign Minister of Macedonia if his country's heavy handed response to the migrant crisis was necessary.
And later if you've ever chaperoned a child in a museum, wait until you find out what happened to this $1.5 million painting.
(END VIDEO CLIP)
GORANI: It might give you chills. Hello everyone, I'm Hala Gorani, we're live at CNN, London, thanks for being with us on this Tuesday. This is The
World Right Now.
French prosecutors have announced some very serious charges against the suspect in the train attack under the nation's terrorism law.
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GORANI: Ayoub al-Khazzani is now charged with attempted murder, attempted mass murder and membership in a terrorist organization. The Moroccan
national's attorney had claimed that Friday's incident was not a terror attack at all but in fact it was a robbery gone wrong.
But the prosecutor say the evidence points strongly otherwise.
FRANCOIS MOLINS, PARIS PROSECUTOR: (As translated) Looking at his internet usage on the phone Ayoub al-Khazzani was looking at, whilst he was
on the train, on YouTube where on which a Jihad - there were Jihadi songs and somebody inspiring people to Jihadi acts.
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GORANI: Well three people were wounded in the attack but it likely would have been a lot worse had a group of travelers not gone after the gunman.
He had more than 250 bullets on him we understand.
Our Martin Savidge is following the latest developments from Paris. What happens now with Ayoub al-Khazzani Martin?
MARTIN SAVIDGE, CNN INTERNATIONAL CORRESPONDENT: Well he's obviously in very serious trouble when it comes to the French authorities here. Now
that you have the charges that are placed against him, attempted murder, attempted mass murder.
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SAVIDGE: And being a member of a terrorist organization and as was pointed out those come under France's terrorism law. So it shows you they're
taking this extremely seriously. The Prosecutor was grateful of course for those who had intervened and prevented a massive tragedy from taking place.
But then that Prosecutor step by step laid out all of the evidence and information that they have so far against the suspect. Saying that not
only did he have three weapons, he had 200 rounds of ammunition and just imagine what that could have done on a train that is packed with people
moving at 200mph.
The inspiration that he got from his cell phone which he had only recently activated. And then they talk about the traveling he had done in the
months before and apparently he had gone to Turkey. Who paid for that because apparently this is a man who has little or no income and in fact
prior to the attack, just days before, is living in a park which begs the question how did he put down 193 euros cash to pay for the first class
ticket that put him on the train.
So over and over you hear the Prosecutor trying to outline that this was orchestrated, that he may have been guided, and that he definitely appears
to have someone funding and helping.
And that's the next question; who was it and where did the money come from, Hala.
GORANI: Was it an organization, was he self-radicalized, so many questions still with this case.
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GORANI: Now Martin we've heard a lot about these three Americans who acted in a very heroic way possibly preventing mass carnage on that Paris train.
But there's a fourth individual who was the first to confront the gunman and who was seriously wounded. Tell us more about him.
SAVIDGE: Yes, many people are beginning to worry that perhaps he's being over-looked or forgotten. His name is Mark Moogalian, and he is 51 years
of age. He was actually born in America but he also has French citizenship and he was teaching English in this country.
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SAVIDGE: And as you say, he was the first to really sort of try to intervene but in the struggle he apparently was wounded, and seriously so.
Last night we heard that his medical condition had begun to deteriorate. The better news we've had later in the day today is that he now appears to
have made a slight improvement but
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GORANI: All right, Martin Savidge, we lost the connection there, thankfully we got all the information there that Martin was communicating
about Mark Moogalian, this fourth individual who in fact (chronologically) the first we understand to try to - to try to prevent the gunman from using
his very heavy weapons and who was wounded we understand in the neck.
[15:05:20] Following that is when the three Americans whose names we know who were decorated by the French President with the Legion of Honor there
in Paris. It's following that first attempt by Mark Moogalian.
Now to this story which has had so many of the world - many investors of the world on edge. What a difference a day makes. Investors are breathing
slightly easier today. Wall Street is rebounding from yesterday's stunning losses.
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GORANI: With just an hour left before the closing bell the DOW is up right now 263 points, up one and two thirds of a percent at 16,133.
Traders welcoming new emergency measures by China to shore up its faltering economy. The green arrows extend to other U.S. indices as well. Here's a
look at the tech heavy NASDAQ we're up two and a third percent there. And the S&P 500 that is the wider market of the New York Stock Exchange up more
than a half percent.
Stocks in Europe as well a recovery across the region. The FTSE, the Xetra DAX, the Paris CAC, and the Zurich SMI, but look at the DAX 5% higher in
Frankfurt.
Stocks in China though suffered another dramatic loss, we'll get to that in a moment.
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GORANI: First let's take you to the heart of the action at the New York Stock Exchange, we're joined by Alan Valdes, Director of Floor Trading at
DME Securities and he's joining me now.
So let's talk a little bit about today's rebound. Should we see this as a reassuring sign that the market is adjusting itself back to more normal
levels?
ALAN VALDES, DIRECTOR OF FLOOR TRADING AT DME SECURITIES: Well I think in the short-term yes it is going to be normal levels.
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VALDES: You know it's a great day to be back, it's slow out here, the buy- ins are only about 700 million. Yesterday at this time we were like at 2 billion, and as you mention we're up about 250. But basically I mean China
of course cut quarter of a point which is good, just a little pop. You know when they do that it's really its just alleviating a little of the
pain but it doesn't cure the patient as we've seen here with QE and with rate cuts. And you know China in the last six months has cut five times.
So really it's a short term fix. We'll see how it goes.
GORANI: But isn't it positive that a market, I mean markets don't just go up and up and up forever. At some point you need a correction, at some
point you need to take some oxygen out of a bull market in order not to have a bigger crash. Do you see this as a positive in some ways what
happened yesterday and Friday?
VALDES: Well yes, you're 100% right, we do want to see a correction. We've gone six years basically without a correction. Normally we get one
every 18 months. But you've got to look what caused that correction and the problems are what caused the correction was basically China and then
oil sliding and then the indecision of the Fed. We still have all three of them, nothing's changed. So really I mean we're just putting off the
inevitable. They have to make some decisions, the Fed in September. China's got to get their house in order and oil we'd hope to see stabilize
down here.
So we still have a ways to go, I think you could see a rough market going into the fall. We'll have to see what the Fed does September 15th to the
19th.
All right, thanks very much Alan Valdes. One thing everyone can agree on, this is a volatile market right now.
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GORANI: Thanks for joining us, Director of Floor Trading at DME Securities at the New York Stock Exchange, a man in the heart of the action. Let's
take a step back now and get to the source of all the volatility, China. Richard Quest is following that part of the story from New York.
Richard, do you agree that this is a band aid, it's a short-term fix reducing interest rates in order to give some confidence to investors that
China is doing what it can right now in the short term to get its economy going again?
RICHARD QUEST, ANCHOR, QUEST MEANS BUSINESS: If the cause is liquidity then reducing rates and reserves and stimulus will certainly do that. If
the cause is solvency then it won't. And we learnt that from the crisis of 2008 both in the United States and in Europe where everybody was so
preoccupied with liquidity, pumping money into the market that yes you certainly keep the market afloat but you don't actually do much more in
terms of long term.
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QUEST: Look at how the market in Shanghai has traded. This is the one year - this is the one year market. You'll remember Shanghai is down some
7% but that very strong gain that you see. But Hala what a dip there and what a dip there and there are strong valid reasons in China why the market
has fallen so sharply which is very different to the sort of Dow Jones one year movements that we've seen where you do get some drops and dips along
the way. But there aren't the same reasons that you're seeing in Shanghai.
[15:10:08] [GORANI: But you are standing - this is the Dow, this is the 12 month Dow graph, I can't really tell from here.
QUEST: Yes that's the 12, let's get in there. That's the 12 month Dow graph yes.
GORANI: And there's a dip there, that is October 2014 so today's level is close to that October 2014 level.
QUEST: Right, that was Fed worries and Ebola, all right. That was a very nasty - now I was interested to what you were talking about with Alan
Valdes on the question of a correction because when is a correction not a correction? You can arguably say it's 10% but if it's a straight forward
10% down, straight down and straight back up again, is that a correction or is that just a bit of biliousness in the market?
What you're looking for with a correction is a sustained fall and there's almost like something concrete going into the market to actually rebuild a
firmer base.
Look at how the Dow's traded today. Very different. This is the Dow at the moment, we're up 245. Only two loses at the moment Hala, Verizon and
Merck Pharmaceuticals. Apple up 4.6% on the back of that email sent to Jim Cramer of CNBC.
Broad based, even those stocks Hala, even those stocks that should suffer as a result of China such as Caterpillar or Intel, or the banks, they are
all up. And that tells me more than any bit of nonsense about whether a market's up or down on any given moment.
GORANI: But you know Richard briefly I do agree with you, technically a correction is 10% off the peak. But if it bounces right back it's really
more volatility .
QUEST: Correct.
GORANI: . than fundamentally a correction here.
QUEST: And that's absolutely - and that's why I caution using this phrase bear market or correction. With a correction you're looking for a fall
that is - and the market stays down and concrete goes into the foundations before it rebuilds to higher levels.
What we're just seeing is volatility, pure unadulterated maniacal volatility.
GORANI: All right, maybe a bit of panic, maybe a bit of uncertainty too. Yes but there's also uncertainty about the Fed. I mean all that plays in
you know. You need more information at this point.
QUEST: Yes, yes.
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GORANI: All right, and we'll get more information at the top of the hour on Quest Means Business. Richard Quest, thanks very much he's live in New
York.
Still to come tonight.
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GORANI: Macedonia has been dealing with a huge influx of migrants over the past week. I spoke to the country's Foreign Minister and asked if it was
able to cope. Hear that interview in a few minutes.
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[15:15:00] GORANI: Well there are some record numbers of migrants and refugees desperate making their way across the Balkans on an exhausting
journey to find a permanent new home in Europe.
Hungarian police say more than 2,000 migrants crossed the border from Serbia on Monday, the highest ever daily total.
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GORANI: Many of them are refugees fleeing the war in Syria. You can see how far they've traveled crossing through Turkey, and then onto Greece,
eventually making their way to Serbia, and then Hungary.
Reaching Hungary is critical as its part of the European Union's Passport free zone giving migrants easier access to Europe's wealthier nations.
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GORANI: Many of those fleeing violence in their own countries are passing through the Serbian capital, Belgrade, a city that knows war all too well.
Arwa Damon has been to a park there to hear some of their stories.
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ARWA DAMON, CNN SENIOR INTERNATIONAL CORRESPONDENT: (Hajaad) strums an old Kurdish song, his wife (Emunis) sits with their three month old in a park
in Central Belgrade turned way station for refugees.
It was his voice that she first fell in love with.
We wanted to settle in Turkey, I was working weddings there, (Hajaad) says but tensions have started to rise and if they kick anyone out it will be
us.
His sorrowful lyrics about feeling like a foreigner is a sentiment that echoes with all we spoke to hear.
We met a group of friends from Iraq, didn't want to appear on camera because they still have family in Baghdad. One of them is a 30 year old
teacher. He says his students cried when he told them that he had decided to leave, that he couldn't take it anymore.
Two years ago militias bombed his wedding and killed his 14 year old brother. Another of his friends, he's a computer engineer, yet another
he's a journalist on what is now the ISIS stronghold of Mosul. All of them say that the most precious thing they have is Iraq but now because of
everything that they've been through they feel like they're a stranger in their own land.
For the refugees the trek is a pendulum of emotions from elation at the small moment of respite to sheer despair. Macedonia after shutting its
border for four days finally started facilitating transit for refugees building a makeshift train stop which brings them to the border with
Serbia.
Of all the nations they have crossed this is the one whose population remembers war, who knows too well that in an instant all can be lost.
At the Belgrade Park there are medical stations, most of what they are treating are foot injuries for the adults. Cough and colds among the
children due to the fluctuating weather and rain with little to no shelter.
From here they will continue they hope to Western Europe. It's not the journey any of them wanted to take but crisis across the world have
resulted in a human tide sweeping across Europe unlike any in recent history.
Two years ago whilst still in his homeland (Hajaad) wrote this song; don't cry my mother he sings, Syria is for my children, for shadowing the
impossible choice his family had to make.
Arwa Damon, CNN, Belgrade.
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GORANI: Macedonia struggling to handle the influx of refugees which come at a rate of 3,000 a day according to the U.N.
Last week riot police used tear gas in a desperate attempt to keep migrants out but in the end they relented and started letting people through.
I asked Macedonia's Foreign Minister, whether his country is able to cope.
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NIKOLA POPOSKI, MACEDONIA FOREIGN MINISTER: Well indeed we were used to having a flow of roughly 500 people a day coming from the Greek side and
then crossing into Macedonia. Suddenly during the last several days it has increased dramatically which are given 4,000 people a day with current
resources it's practically impossible to handle such a - such a pressure if we want to maintain control on the border and keep registering migrants.
GORANI: But Minister Poposki you were very much criticized on Friday. We saw some very tragic scenes, refugees were gassed, there was a very heavy
handed response some human rights organizations were saying. Why was the decision made to respond to the in-flow of refugees in that way?
POPOSKI: I think it was a pretty unfair way of treating the situation on the ground because Macedonia has been doing tremendous efforts in order to
handle in a most human way all the migrants that have been crossing into our territory. And we have a tradition of treating migrants very well.
It's probably a country that has hosted the largest number of migrants in per capita terms in Europe since World War II.
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[15:20:03]POPOSKI: However, the fact is that we have had the situation during 48 hours thousands of people being shipped from Greek Islands mainly
into Greek mainland and then pursuing the road to Macedonian border. Our options were pretty limited.
GORANI: But Minister Poposki, I understand how difficult this is for a country the size of your country to deal with but the scenes were shocking.
Amnesty International said authorities in Macedonia responded as if - as if they were dealing with rioters rather than refugees with tear gas, pushing
them back with military equipment. Do you regret any of the way this was handled over the weekend?
POPOSKI: Clearly we have no interest in such - in such a way of dealing with the situation. But as I said options were limited. I think that some
of the things have been a little bit exaggerated and the other thing probably this would have been handled without having any kind of incidence
but for that we would have needed resources, and some sort of assistance from the European side would have been needed.
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POPOSKI: This is the only border where migrants are crossing from EU territory into a non-EU member state country. So probably the control on
the other side could have been strengthened and we would have never faced this kind of situation, and the pressure that you are referring to.
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GORANI: All right, so it appears as though you might be getting some funds, some money to help you deal with this. But as far as your country
is concerned, what do you think the solution is here? What should it be?
Because with what's going on, and I understand more than 80% of some of those desperate refugees come from Syria, Europe is not able to build walls
around itself. At some point this situation has to be dealt with. What do you think is the solution?
POPOSKI: Ultimately if we don't find a solution for the conflict in Syria and Iraq, it's pretty unlikely that any of the countries down the road is
going to find a way to prevent uncontrolled migrant flows. And I think that what has been happening in the last several months is simply shifting
the responsibility down the road. So Turkey's under tremendous pressure, it has more than one and a half million refugees on its territory. Many of
them are crossing into Greece. Greece does what it can in terms of decreasing the pressure on the islands and then shifting people on the
continent.
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POPOSKI: We are the next border. For us the easiest way to deal with it would be to turn a blind eye and then let them simply penetrate into
countries of the European Union but we do not want to act in an irresponsible manner. We're going to need a joint European answer and a
joint effort in this - in resolving this crisis. Probably migrants are going to continue coming on European borders unless the crisis in Syria and
Iraq is resolved.
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POPOSKI: And I don't think that any of the countries on this road would be able to face the challenge on its own.
GORANI: But it doesn't appear as though Iraq and Syria .
[CROSS-TALK]
POPOSKI: Some control management - some control of the borders will be necessary.
GORANI: Got it. Some control - OK, but it doesn't - the serious situation in Syria, the situation in Iraq, the situation in Afghanistan all of these
people are desperate enough to risk death and travel with babies and young children to try to find a better life and a safer life for themselves.
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GORANI: When you say a joint response, what do you mean?
POPOSKI: We cannot ignore the fact that these people are desperate about getting some help and safe haven and I think that this is a European
responsibility. But there have been a fair way to treat this, one of those has been the option that was proposed about distributing quarters among
European countries. And I think that this will be one of the ways to treat the current crisis with the migrants that are on European territory.
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POPOSKI: The other aspect would be to provide for them safe haven closer to their countries and even in the countries, meaning in Syria and Iraq,
provide some territory where they can be safe and secure.
All the other options are going to involve a lot of illegal and uncontrolled migration and probably reactions from different member states.
GORANI: The Foreign Minister of Macedonia speaking to me. What do you think the solution is? We're seeing thousands and thousands of desperate
migrants most of them from Syria with their families trying to find a better and safer life in Europe.
What should the response be? Go to the Facebook page, facebook.com/halagoranicnn - facebook.com/halagoranicnn.
Coming up we have seen Russia's President doing everything piloting a plane to fly fishing.
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GORANI: Now, Putin is trying out sales. He's pushing Russia's military hardware in some controversial deals. More next.
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[15:26:28] GORANI: A Russian military court has sentenced a Ukrainian filmmaker to 20 years behind bars for plotting terrorist acts in Crimea.
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GORANI: Activist Oleg Sentsov, we see him there on the left insists he is innocent. Another Ukrainian was handed a ten year sentence.
They sang Ukraine's national anthem after their sentences were read. Critics have slammed the trial as a politically motivated chant.
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GORANI: Russia is poised to sell Iran an advance missile system despite strong opposition from Western countries.
Crashing commodity prices have squeezed the Kremlin's budget and it needs cash put quite simply so now Moscow is looking to sell more of its military
hardware abroad.
Matthew Chance explains.
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MATTHEW CHANCE, CNN INTERNATIONAL CORRESPONDENT: The awesome spectacle of Russian air power tearing through the sky. This is the Kremlin's cutting
edge weaponry on display and on sale at its most high profile arms fair.
Warplanes like these are among Russia's most lucrative exports and interest seems high. Despite western sanctions delegates from more than 20
countries attended the opening evidence to the Kremlin it's not isolated.
UNIDENTIFIED MALE: (As translated) I'm convinced that regardless of the current international and political environment this international aviation
and space salon will serve as an efficient venue for expert level communications and to find new partners.
CHANCE: Potential new partners from states in the Middle East, like Abu Dhabi and Jordan where Russia doesn't traditionally sell arms. The
Egyptian president is also visiting Moscow as is the king of Saudi Arabia in what could herald significant deals with Russia.
Well there's a lot of interest in this helicopter. It's called the KA52K and it's a new aircraft and it's been developed by Russia to go especially
on board those amphibious assault ships, the Mistral aircraft carriers that were commissioned from France. That deal never went through because of the
sanctions against Russia over Ukraine.
Now there's word that Saudi Arabia may be interested in buying those aircraft carriers from France and purchasing these helicopters from Russia.
But by far the most controversial deal may be with the Iranians soon to finalize the purchase of sophisticated S300 surface to air missiles that
could shield its nuclear facilities. We ran into the delegation at the missile pavilion.
Are you interested - are you going to be signing this deal for the S300s today?
KHON SIAVESH NADER: IRAN DEFENCE MINSTRY: We are - we are (inaudible) then we want to decide.
CHANCE: Ah, but you haven't decided yet? Negotiations may still be underway but the coming days could see Russian arms deals go sky high.
Matthew Chance, CNN, Zhukovsky, Russia.
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GORANI: Coming up, U.S. stocks may be rebounding but markets in China are sinking.
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GORANI: Perspective on the meltdown just ahead.
Plus yet another disturbing message from ISIS, the extremists have released video showing the destruction of this cultural treasure.
We'll be right back.
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[15:32:11] GORANI: Welcome back, here's a look at your top stories. Stocks on Wall Street are surging today after Monday's massive sell-off.
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GORANI: The rally is slowing down a bit, we'll check the numbers for you right now with about 30 minutes left in the trading day. The Dow Jones
Industrial average is up 78 points, that's half a percent at 15,957 (inaudible) the session highs.
Traders though are welcoming some new measures by China to shore up this faltering economy but the enthusiasm may be waning there.
Also among the top stories.
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GORANI: French prosecutors have announced multiple terrorist charges against the man accused in the thwarted train attack.
(BEGIN VIDEO CLIP)
GORANI: Authorities say Ayoub al-Khazzani had about 200 rounds of ammunition on him last Friday. Prosecutors say his goal was "to kill a
whole train full of people."
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GORANI: 14 people have been arrested in Spain and Morocco on suspicion of recruiting for ISIS.
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GORANI: The suspects were taken into custody in a town outside Madrid and in a number of other locations across Morocco. Officials say the network
sent foreign fighters to Iraq and Syria.
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GORANI: Macedonia says more than 700 refugees seeking asylum have registered at the border in the past 24 hours.
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GORANI: More than 45,000 registered since mid-June, the majority of them are Syrian. But officials say the numbers don't fully represent the
reality on the ground.
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GORANI: Let's get back now to one of our top stories. The Dow has not erased all of its losses from Monday's route but its gains are still
helping ease investor fears at least somewhat.
Alison Kosik is live at the New York Stock Exchange. Alison, we just told our viewers where the Dow is right now, it is up session highs and these
strong gains are double digit gains at this point. What's going on?
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Well you know what it is it's basically a lack of confidence and a lot of uncertainty that's making the
rally that was fizzle out.
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KOSIK: You know the Dow was up as much as 441 points earlier today. As you can see on the screen it's now up only about 57 points.
The S&P 500 looks like it's almost at the flat line at this point wiping out those gains as well.
You know this is all about uncertainty first of all about the Fed. Wall Street's still uncertain whether or not the Fed's going to go ahead and
raise rates in September as has been indicated. And also there's a lingering question mark about China.
I mean if you think about it between yesterday when we saw the Dow fall 588 points, and today, nothing really has changed except for of course China
Central Bank stepping in, cutting an interest rate, pouring billions of dollars into the financial system. But the problem is, China's made moves
like this before and it hasn't helped the situation there.
So you're seeing that lack of confidence play out here on Wall Street as we see the rally kind of fizzle out Hala.
[15:35:03] GORANI: All right, Alison Kosik there on the floor of the New York Stock Exchange, thanks very much as we continue to keep our own on the
Dow Jones Industrial average. They're up 75 points. We were up triple digits just a few hours ago.
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GORANI: If you were brave enough to look at your stock portfolio Monday you may have gotten quite a shock but imagine if your losses were in the
billions.
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GORANI: That first of all means you had billions to lose which I guess isn't so bad but Asia's richest man has watched a big fraction of his
wealth drain away on paper at least.
Wang Jianlin has lost some $13 billion in China's market crash since June. That still leaves him with about $13 billion so he is fine.
Of course small time investors don't have that kind of cushion to fall back on. They're the ones feeling the brunt of this crisis and they simply in
many cases cannot afford to lose a huge chunk of their savings.
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GORANI: Let's bring in Linda Yueh for some perspective, she's an Economics Fellow at Oxford University and is a former Chief Business Correspondent
for BBC News.
So, first of all let's talk about ordinary small time investors in China. They were behind a lot of why some of these indices went up, there was a
lot of speculation in day trading et cetera; now they are suffering big time.
LINDA YUEH, ECONOMICS FELLOW, OXFORD UNIVERSITY: That's right and in fact the Chinese market is so unusual 85% of the trade are actually by small
retail investors. And if you look at where they've gained over the past year they have gained 150%. So in other words the stock market was
basically in this massive bubble fueled by small investors and some are doing what we would call profit taking in any other market which is to say
they would go out.
But, because they're all small investors they tend to exhibit herding behavior. If they think one investor is pulling out then others pull out
and that's why the Chinese market is so volatile and you can see drops of 8%, 6%, anything over 3% for a major market we would all be sitting back
saying wow. But for China this volatility I'm afraid is the norm.
GORANI: Well if you have an 8% drop on the Dow, I mean that is absolutely widespread panic, very different from the Chinese market. You're saying
85% are smaller investors. How does that compare to a big market like the New York Stock Exchange?
YUEH: Well the New York Stock Exchange predominately institutional investors, you look back about maybe 40 years ago half of U.S. households
owned stocks but now that's down to probably about a quarter. So in other words most stock markets especially of China size would be dominated by big
institutional pensions, investors that are not so volatile in their trading but as you mentioned there are some of the Chinese small investors who are
doing day trading, institutional investors invest for the longer term. And that's when you see a little bit of a panic and then you see a
stabilization in the U.S. market, in the European market that's because the institutional investors have looked at it and said OK, that was the initial
reaction, maybe a little bit of (algo) trading happening there but overall we don't need to panic yet.
GORANI: But Linda they're still fundamental - absolutely. And really to be fair there - I mean it was a huge drop on Monday but would we call it
panic?
YUEH: Well it's interesting the Chinese state media labeled it black Monday and I think that was the trigger for global markets to selloff
because my gosh if the Chinese government is saying this is as bad as a black Wednesday or a black Friday which we've seen in other markets, there
must be something deeply worrying.
But I think if you look at what's happened to the other markets there were other pressures as well because global growth is a huge concern. And what
the Chinese market is really saying is that the closed market only affects Chinese investors but what if the slowdown is because Chinese companies are
not as profitable as before.
What if the Chinese consumer isn't going to buy as much, and that's where the global impact is coming from.
GORANI: So there is concern that growth coming from China, which was very higher, much higher than Western economies .
YUEH: Oh gosh they're nearly 10%.
GORANI: . That was fuelling - 10%, that was just an ordinary year. That hasn't happened in a Western economy in decades. But if that slows does
that mean that stock markets, equity markets are overvalued right now if they cannot rely on China to pull the sort of world global economy?
YUEH: I think there is a concern big multi-national companies won't have the sales that they've seen before. So for instance, Apple CEO Tim Cook,
he's actually intervened a couple of times to say the Chinese slow down isn't going to affect us that much even though that's the biggest market
for the iPhone ahead of the United States.
Burberry, BMW, lots of companies have come out to say we won't be that affected. However it's -- China's the world's second biggest economy, it
drives more global growth than the United States and has been since 2008.
So if it slows as an engine, it will impact multi-national companies so therefore it will have an impact on global markets and countries will be
affected differently. United States, less than 1% of exports - less than 1% of GDP is exports to China, but Japan is 3%, Germany its 2%. Australia
a third of their exports go to China, they will be deeply affected.
And so you will see differing impact but what's very clear is that China's growth is slowing and until companies and countries get their heads around
it I think we're going to continue to see a lot of volatility.
[15:40:14] GORANI: Linda, let me just show our viewers what just happened while we were speaking. The Dow turned negative.
YUEH: Oh dear.
GORANI: Let's put that up - yes I know. Let's put it.
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GORANI: I have it, where is that almost - there we are well it's flat essentially. It turned negative a few seconds ago, its back up slightly
above the break-even line there.
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GORANI: But here what we're seeing Linda briefly is unconvincing - certainly not a rally but certainly not investors convinced that everything
is fine.
YUEH: No, they're deeply worried about Chinese growth and the stimulus, the cut in interest rates in China injecting liquidity through cutting the
reserve ratio requirement for banks. All of that has helped bolster the market. But you know the debate here (inaudible) for the stocks in the
short term but over the longer term excess liquidity fuels bubbles and that's what the investors were probably hoping we could get away from as
rates look to rise in the U.S. and in Europe - not in Europe, maybe in the U.K. sometime over the next year.
So I think that's the underlying concern. You want to see the stimulus but does that mean China's in deeper trouble than we thought and what does that
mean for normalization of rates in the United States.
GORANI: All right, so many questions Linda Yueh, thanks very much. It was great talking to you and we hope to be able to have you on the program
again.
Now onto something completely different and if you thought it couldn't get more depressing as far as Syria's archaeological treasures are concerned
well it just has because ISIS has released images showing its destruction of a priceless ancient temple that I can tell you is heartbreaking to
imagine is no longer there.
Scholars have called for the militants to stop their obliteration of cultural artifacts but those pleas have landed on deaf ears.
Ben Wedeman reports.
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BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT: The pictures show ISIS fighters rigging the temple of Baal Shamin with explosives, then the
blast, and then the aftermath. 2,000 years of history turned into rubble and dust.
It wasn't ISIS' first brazen act of vandalism against the past. In Iraq they've gone on a rampage of destruction not seen since the Mongol sacking
of Baghdad in 1258. And alas, it probably won't be the last.
Since driving Syrian regime forces out of the ancient city of Palmyra in May they've smashed statutes, used the city's Roman era amphitheater as a
backdrop to a mass execution of regime soldiers. And last week beheaded the 82 year old former Palmyra Director of Antiquities.
Many of the most important artifacts were moved to relative safety in Damascus before ISIS took over Palmyra.
ISIS' war against the past is part of its policy of shock and awe, destroying ancient temples and statues, Christian churches and Shia
shrines, in the name of their warped vision of Islam. Executing prisoners and hostages in grizzly snuff films to show they'll stop at nothing to
achieve their goal of a worldwide caliphate.
But for ordinary Syrians shock and awe is oiled. More than 250,000 have been killed since the uprising against Bashar al-Asaad began four and a
half years ago. Millions have fled the country many now desperately trying to reach Europe while millions more have been displaced.
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WEDEMAN: The four horsemen of the apocalypse are stalking Syria, few people there have the luxury to mourn the loss of an old building.
Ben Wedeman, CNN, Rome.
GORANI: This is The World Right Now. Still ahead;
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GORANI: We check in on the U.S. Presidential race where candidate Jeb Bush tries to clear up one controversy but by doing so kicked off another. Stay
with us.
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[15:46:12] GORANI: Well you're seeing by the way before I move onto U.S. Political news. What you're seeing there is the Dow Jones Industrial
average index, it is now down 63 points.
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GORANI: Yesterday the Dow lost more than 500. We thought we had a rebound today after China made a small move on interest rates, but clearly that did
not infuse investors with confidence as the Dow is back down to 15,803. 798 there, down 75 points. So in negative territory, just about 15 minutes
before the close.
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GORANI: There is increasing speculation that the Vice President of the United States, Joe Biden is closer to jumping into the Democratic race for
President.
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GORANI: The senior Democrat says U.S. President Barack Obama has given Biden his blessing.
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GORANI: Meanwhile Jeb Bush is facing an outcry after using the term "anchor babies." Anchor babies refers to children born in the U.S. to
those who are not American citizens as a way for other family members to secure legal residency. Many find the term "anchor babies" offensive.
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GORANI: While the Republican candidate tried to defend his original statement but launched a new controversy by doing so.
JEB BUSH, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: My background, my life, the fact that I'm immersed in the immigrant experience this is - this is
ludicrous for the Clinton campaign and others to suggest that somehow I'm using a derogatory term.
What I was talking about was the specific case of fraud being committed where there's organized efforts, and frankly it's more related to Asian
people, coming into our country having children in that organized effort, taking advantage of a Nobel concept with this birth right citizenship. I
support the 14th Amendment.
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GORANI: Mark Preston joins us now live from Washington. He's the Executive Editor of CNN Politics. Mark, first of all Jeb Bush trying to
get out of one controversy, got himself stuck in another one. Why is Jeb Bush struggling on an issue that should be a strong point for him?
MARK PRESTON, EXECUTIVE EDITOR CNN POLITICS: And it should be a strong point for him Hala because his wife is Mexico.
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PRESTON: Born and raised here Jeb Bush met her in Mexico and then they got married and of course they've lived in Miami now for all these years. Jeb
Bush is not a very good retail politician, he's very wonkish, he's very smart but he certainly doesn't have the pizzazz the likes of Donald Trump
has on the campaign stump.
So when you have Jeb Bush there trying to explain what he meant by anchor babies, he tends to get himself in a little bit more trouble than he
should.
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GORANI: And the Republican - you mentioned Donald Trump there, he's doing of course very well, he's leading in Republican polls. And the Republican
candidate Lindsey Graham had some fighting words for Donald Trump when he spoke to CNN earlier. Tell us about that.
PRESTON: Well there's certainly no love lost between Lindsey Graham and Donald Trump. In fact the spat got so bad between the two of them that
Donald Trump gave out Lindsey Graham's personal cell phone number which required Lindsey Graham then to get rid of it.
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PRESTON: But what we've seen over in the past few hours is that Donald Trump has been trying to tweak Lindsey Graham, criticize him on twitter,
kind of poke fun at him, and then Lindsey Graham on our ear here on CNN went right after Donald Trump.
GORANI: Let's listen to this. I think we need to listen this (inaudible) let's listen to Lindsey Graham.
LINDSEY GRAHAM, REPUBLICAN PRESIDENTIAL CANDIDATE: I'm just saying that the policies that Mr. Trump is proposing were demagoguery. His approach to
describing illegal immigrants are hurting us with Hispanics. The way he attacks women is going to be a death blow to the future of our party.
Come to South Carolina, and I'll beat his brains out. I know my state. This is a silly season in politics.
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[15:50:10] GORANI: Wow, I mean first of all this obviously was a planned attack, right. How does it usually work? Does he get - does he get
campaign advice to go really for the jugular on this one and will it help or hurt him?
PRESTON: Well, certainly for Lindsey Graham, I think he - I don't think it was planned in the sense that I don't think he knew he was going to say
that. But as I said Lindsey Graham doesn't like Donald Trump, they don't like each other. Very personable hatred for one another.
In fact when Donald Trump said that John McCain who ran for President in 2008 when Donald Trump said that John McCain wasn't a true war hero because
he was caught as a Prisoner of War, the first person to his defense was Lindsey Graham. Lindsey Graham is John McCain's best friend.
So I think you will continue to see this play out between these two men as well as other.
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PRESTON: Because Donald Trump now seems to be taking a stick and poking every one of his rivals right now and really taking a lot of glee in doing
so.
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GORANI: And let's talk about Joe Biden, we mentioned that before coming to you Mark. Do you think he will run?
PRESTON: You know Hala, if you and I had this conversation a week ago I would say absolutely not.
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PRESTON: That Joe Biden, like anybody would be looking at running for President, but it seems to have gotten a lot more serious in the past week.
We saw that he met with Senator Elizabeth Warren who is beloved by progressive liberals here in the United States. They met on Saturday for a
couple of hours. He is also now meeting with very powerful political Democrats here in Washington D.C., trying to suss them out and get their
lay of the land.
You know a lot has to really rely on whether Joe Biden in one of his final conversations with his son who passed away about two months ago whether his
son did in fact tell him that he wanted his father to run, which is what we're lead to believe. And if it's that true will Joe Biden do one of his
last wishes for his son and in fact run again, and if he does run Hala, it will be Joe Biden's third attempt at the White House.
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GORANI: OK, Mark Preston in D.C., thanks very much. Coming up a story that will make every parent cringe.
Find out what one pre-teen did to this 350 year old masterpiece.
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GORANI: Well so much for Tuesday turnaround, a big market comeback.
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GORANI: After rallying for most of the day the Dow Jones is now back in negative territory, we're down 44 points with just a few minutes left in
the trading day. As I was mentioning we were hoping for a turnaround today after a big dig yesterday. The NASDAQ and S&P suffered a late day decline
as well, though the NASDAQ right now is still in positive territory. And the reason for that by the way is because leading the charge today were
tech stocks. The NASDAQ is the tech heavy index so it would make sense for it to be able to maintain its positive performance.
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GORANI: A 12 year old boy in Taiwan has become an internet sensation for all the wrong reasons. Robyn Curnow explains how his clumsy blunder ended
up costing a bundle.
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ROBYN CURNOW, CNN INTERNATIONAL CORRESPONDENT: It's the kind of pre-teen blunder that makes any parent cringe. A 12 year old boy at a touring in a
Taipei art exhibition, loses his balance, stumbles over a rope area and ends up tearing a hole in a 17th century masterpiece. His clumsy mishap
caught on surveillance camera and now seen across the internet.
[15:55:13] The painting is Paolo Porpora's flowers, it's around 350 years old and experts say it's worth $1.5 million.
Luckily for the boy organizers are not asking his family to pay for the cost of restoring the damaged artwork.
UNIDENTIFIED MALE: It's obvious that he did not mean to push the painting. I think he may have been focusing on what the teacher was saying and his
eyes were elsewhere so he accidentally stepped on the platform and had a bit of a fall.
CURNOW: The accident happened Sunday and left the hole the size of a fist in the canvas. Art experts in Taiwan have already started repairs.
UNIDENTIFIED MALE: We will begin the restoration work by enhancing the canvas of the painting amending the part that was torn on the backside. We
will then turn to restoring the paint on the front side.
CURNOW: The oil painting is insured and is due to be shipped back to Italy later this week for further repairs before being returned to its owner.
And despite the damage exhibit organizers say they have no plans to move the paintings further away from the public, calling this a one-time
accident.
Robyn Curnow, CNN.
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GORANI: A Brazilian Toucan is getting a new lease on life thanks to a printer. Tieta was rescued for an animal fair in Rio di Janeiro by federal
police. She was missing a part of her beak possibly after she was mistreated by wildlife traffickers and then Tieta couldn't eat or take care
of herself properly. So Brazilian researchers came up with a novel idea, they used a 3d printer to make her a new beak and just screwed it on
apparently.
It took them three months to design and print it but just three days for Tieta to get used to it. Now she's happily back to eating bugs.
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GORANI: This has been the World Right Now, I'm Hala Gorani, thanks for watching. Quest Means Business is up next.
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