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Hala Gorani Tonight
SpaceX Launches World's Most Powerful Rocket; Volatile Trading Day Nearing its Close; Long-Term Outlook for U.S. Markets; U.S. Inflation Fears Fuel Global Sell-Off; U.K. Judge Says Assange Arrest Warrant Still Stands; Pence: North Korea Must Remain Isolated. Aired 3-4p ET
Aired February 06, 2018 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
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[15:00:11]
HALA GORANI, CNN INTERNATIONAL ANCHOR: Hello, everyone. Thanks for being with us live from CNN London. I'm Hala Gorani.
Tonight, a lot going on, a massive earthquake has struck Taiwan. We are seeing some incredible video from the island. We will be going live to the
region for an update. Stay tuned for that.
Also, well, a wild ride for the Dow. We go to Wall Street where it's driving the volatility. We are up now, look at the bar, that graphic right
above, red, green, red, green.
And to the moon or Mars, we are counting down for the launch of the world's biggest rockets.
All right. all those stories at a moment, but let's begin with Taiwan because some of the images coming out of Taiwan are absolutely devastating.
Terrifying images of the aftermath of a strong earthquake. Now, of course, you are at this stage now after an earthquake where rescuers are hoping to
retrieve as many people as possible from some of these collapsed buildings.
The northeastern city of Cheyenne got a big, got the brunt of it, 6.4 magnitude quake cracked roads. It caused several large buildings to begin
to crumble. You can see some of them have completely tilted essentially and are standing.
The fear here has to be that some of these buildings will not stand in that tilted state for too long. So, you need to get people out of it. The
earthquake hit in the middle of the night pretty much when people were asleep.
And all those people trapped in their homes who might have been in bed, obviously lying flat, who might have just started sort of turning in for
the night are people who are no doubt terrified.
Let's bring in Alexandra Field in Hong Kong with the very latest. So, talk to us about what we know so far about any dead or injured, Alexandra.
ALEXANDRA FIELD, CNN INTERNATIONAL CORRESPONDENT: Well, Hala, at this point, there are at least 200 people who were injured. Two people who have
been killed in the earthquake. You mentioned the fact that certainly there are people who are trying to get out of those buildings for fear that there
could be further collapsed.
The big question right now, how many people are still trapped inside, how many people could be missing, how many people are unaccounted for. That's
why you got Taiwan's leader, tweeting, telling people to try and stay safe, telling them the rescue operations are underway.
Those, of course, involve government services and the Armed Forces. But again, this all happened during those overnight hours. So, you did have
people who were inside the buildings. Three buildings have now collapsed.
We are told those are two city department buildings and also a hotel, and that we understand is where the majority of the injured were inside that
hotel, the Marshall Hotel. Certainly, it is a place where people would have been asleep in their beds during these overnight hours when this 6.4
magnitude earthquake struck.
We have heard from survivors who are recounting what happened. They are telling that they felt this sort of prolong swaying middle of the night
that 6.4 magnitude quake was then followed by a 5.1 magnitude quake.
This is a region, of course, that is prone to these quakes. Several of them, Hala, in the last few days. So, people know how to prepare, but when
you see these images, you know, that certainly people are scrambling to try and get out to try and get to some safety as you continue to assess how
much damage some of these buildings truly have sustained.
And it is not just the buildings, of course, we know it's also the infrastructure, at least two bridges that were affected by that 6.4 quake.
So, you can see that there are operations out there to try and get people out.
That people really need to also take matters into their own hands at this point. We've seen images of people crawling out the windows glass
shattered in a lot of these buildings even a woman being rescued by a crane.
So, certainly, the priority right now getting those people to safety. No tsunami warning at this point -- Hala.
GORANI: All right. Well, at least, there's that and rescuers have a lot of work overnight getting to all those people who survived this terrifying
incident. Thanks very much, Alexandra Field.
We will keep our eye, by the way, on this story in Taiwan and get back to it as soon as we have more details. But as I mentioned there, first
original initial quake of 6.2, then there was a pretty strong aftershock and what looked like very solid buildings severely damage there. We'll
keep our eye on that.
Let's turn our attention now to the markets. Remember that wild, wild ride over the last two days? Well, it continued again today. We have about 56
minutes until the closing bell on Wall Street.
I would love to tell you what to expect and how these markets will end the session, but after the past couple of days, I am not going there. Your
guess is as good as mine. This is how the Dow is doing right now, but we saw it went up, it went down, it went up, it went down all day.
Now it is a triple digit rise for the Dow up 357 at 24,705. It recovered after plunging more than 500 points on opening. Part of the reason for
that was Monday's rollercoaster session.
This is spin up footage of what investors were faced with. The losses you see here triggered selloffs, by the way, across the planet.
[15:05:09] It was during that session, the largest intraday loss in history. Richard Quest is where it's all happening, the New York Stock
Exchange, with more. Well, I don't want, you know, could my chicks before they've hatched, but at least, it looks like we might end on a positive
note today -- Richard.
RICHARD QUEST, CNN ANCHOR, "QUEST MEANS BUSINESS": Way too soon to say as you rightly point out, Hala, but we all just about at the session highs.
Now earlier in the session, the market had been up about 360 points, but within the last 10 minutes, the market had gone up as much as 393 points.
So, you are talking about a 960-point range for the Dow over the course of today. In fact, we are up the sessions now. It just gone through 409,
which makes us nearly a thousand-point range for day on its own.
And you're right, Hala. I mean, a fold would predict how we are going to close in 54 minutes from now and certainly, I wouldn't put the shirt on the
back on that number.
GORANI: All right. What are traders saying there at the New York Stock Exchange? What is going on?
QUEST: Traders are sanguine. They are relaxed about it. There is not a panic in their eyes and the reason is they say nothing has changed. The
economic fundamentals are still there. This is a correction that is being underway.
And in the face of the algorithmic trading on the big hedge funds, on the pension funds, on the mutual funds, there is nothing to be done to be done
other than to let it play itself out.
GORANI: OK, algorithmic tradings, we'll get to that with our next guest. Richard Quest, thanks for joining us. We'll see you at the top of the hour
on "QUEST MEANS BUSINESS."
Let's get some reaction from a trader now. Today, our Dow guy happens to be the cow guys, Scott Shellady from TJM Investments is here. How are you
doing? So, do you agree that this is just kind of a flip, it's a correction.
The air is let out of this big giant balloon finally, but the fundamentals of the economy are strong, so we shouldn't be too concerned?
SCOTT SHELLADY, SENIOR VICE PRESIDENT OF DERIVATIVES, TJM INVESTMENTS: All day we've been talking about how all the fundamental of the economy are
strong, right, but just because things are strong, it doesn't mean the Dow should go up, right? We've had a bad (inaudible).
There are things (inaudible) weren't very good over the last five years, but what the Dow do, straight up. So, the Dow can go up when the numbers
aren't good. It can also go down when the numbers are very good. So, we are in a corrective phase. It's healthy for the market.
I would like to see us churn at this level for a little bit here so people can learn the lesson that things just don't always go straight up. There
is some risk here and I think we forgot about that for a while.
GORANI: But the Dow wasn't necessarily, as you mentioned, a reflection of the economy, which is a very important point to make. The Dow is a
reflection of what investors expect corporate earnings, corporate cash flow to be like so deregulation and tax cuts for corporations that gets the Dow
going not necessarily a strong fundamental economy.
SHELLADY: Exactly right. And the Dow is aborting mechanism for 6,12, 18, and 24 months out from now, right. We've (inaudible) a lot of good news to
get the Dow where it's at. So, now we have to start thinking about what's the next round of good news that's going to keep the Dow where it's at or
propel it to new highs.
So, we are in a precarious situation because we have had a lot of investors get comfortable and they've even getting shorter (inaudible) or at least
they don't think the markets is going to be very volatile.
GORANI: It's been going up since (inaudible).
SHELLADY: And that's been a good trade so far, but it's only a good trade until it's not, right. That's what we say on the floor and they've been
having to de-lever or get out of these things and that's caused this cascade.
I don't think it's over yet, but it will be -- we're like a punch strong fighter, right? We are in concussion protocol mode right now.
GORANI: I want to talk to you about these algorithms that Richard Quest brought up. For people not familiar with those, with that mechanism, what
is that in the market?
SHELLADY: They are programs that take place when aspect out of it. You can write a program that will use your line of thinking. It then goes to
kind of old school thing that we used to do in college and then plug it into a program and then it will make a decision for you if these things
exist, if these types of our scenarios exist.
Well, when that happens, the machines take over, and the only think they can really do to stop them is unplug them. There aren't any breathing
humans that would have been involved in that --
GORANI: So, you might have a program that would sell at a certain level or buy at a certain level and those kick in automatically.
SHELLADY: Yes, and then sometimes -- it's like a house of cards. They can set off other machines, right? And that's what happened, you know,
yesterday.
GORANI: Now, the broader market, the S&P 500 is probably a better indicator of the health of the economy because it's broader. It's an
index. It's 500. It's gone down as well, but it's up a lot year to date. What does that tell us?
SHELLADY: Well, I think that the sentiment is changing states, that's one good thing, but we have seen -- there hasn't been -- we couldn't sell off
when we had the North Korea problems. We couldn't sell off when we had any governmental issues.
We finally sold off when we saw interest rates get a little bit higher and interest rates are creeping up because things are looking better, right?
So, it's conundrum. When things do start to turn the corner, we have better growth, higher interest rates to slow inflation down because things
are getting hot.
[15:10:05] Then the stock market now has something to compete with it, right. So, people that are looking for dividend yields of 3 percent can
now put in a 10-year bond.
GORANI: Yes, now you -- and we've read this a lot and I've read may experts say the fundamentals are strong. You still have major issues with
national debt. I mean, the U.S. government has added a trillion dollars to its debt just with this latest legislation, this tax cut legislation.
European economies are extremely indebted as well. Interest rates are low. The next crisis, what are your tools to deal with this?
SHELLADY: Well, they don't have any tools. They've kind of thrown everything in the kitchen sink of the problem and like you said if we see
interest rate go up because they are still very historically low levels. We are close to having them, you know, the (inaudible) threshold.
It's going to hurt the government and borrowers and folks that are still looking for some sort of return maybe in the stock market putting that
money away to bond. So, that's where the first wobble was on Friday. Hey, interest rates might be going up, things are pretty good.
GORANI: And wage growth was up.
SHELLADY: That was another inflationary indexing that made everybody feel like, hey, we might have some inflation coming here, we might have to raise
interest rates to slow that inflation down. So, all the good news is what made the market tail off, which that can happen, and things can be
fundamentally unchanged.
GORANI: That's the reason, though, isn't it? Just because clearly it was becoming slightly irrational.
SHELLADY: How about this?
GORANI: Yes.
SHELLADY: We were up 6 percent for January. The 90-year average for the year is 10 percent.
GORANI: Right, that's not rational.
SHELLADY: So, in January, it is 60 percent of our average --
GORANI: Exactly. It doesn't matter how well a corporation performs that's not irrational --
SHELLADY: So, we had -- it was Bitcoinesk at some point in time there.
GORANI: Let's hope it's a healthy cause and not the beginning of something worst. Scott's Shellady, thanks very much for joining us. Appreciate it.
The volatile stock market is a headache for the White House. I mean, of course, Donald Trump is saying, look at the stock market. Here's proof
that my management of the economy is working great.
But obviously, it's not the only barometer. One clock is ticking for President Trump to make a decision on something entirely political, an
important memo, sound familiar? This is the Democratic rebuttal to last week's controversial Republican memo alleging the FBI abused surveillance
laws.
Both Democrats and Republicans in the House Intelligence Committee voted to make it public. Now it sits on the president's desk. He has five days to
decide what to do.
Let's go live to Washington. Jeremy Diamond joins me with that. So, we saw the Nunez Republican memo. What about the Democratic rebuttal?
Politically speaking obviously, the opposition party in America wants that to be made public as well, will it?
JEREMY DIAMOND, CNN WHITE HOUSE REPORTER: Yes, that's right. You know, we saw the vote yesterday in the House Intelligence Committee unanimous to
make this memo public and now the White House will have five days to simply bring it through this interagency review process allowing the FBI
intelligence agencies to have some input into whether or not this memo should be declassified.
Particularly looking at whether there should be any reductions to protect sources and methods and other concerns as well. And so far, the
indications are that the White House is suggesting that the president is going to allow the process to play out and the source earlier today telling
me that they believe that the president will listen to the FBI and the intel communities' recommendations as far as this memo is concerned.
You know, now what the White House and these sources are trying to do right now is to try and say listen the president's declassification of this memo
if it happens will happen along the same lines as the Republican memo last week.
The problem with that, of course, is that the president last week was already eager to declassify the Republican memo before it even hit his
desk, before he had even read it.
And so, the White House this week eager to try and distance the president a little bit from the declassification of this memo suggesting that the
process is going to play out. That he's going to listen to the FBI.
Of course, that's not exactly what happened last week. We know, of course, that the FBI strenuously objected to the release of the Republican House
intelligence Committee memo saying that they had grave concerns that it painted an incomplete picture.
So, if the president does follow through here and listen to the FBI and the intelligence community not exactly the same process as last week, but it
will at least try put a little bit of distance between him and the declassification of this memo, which really undercuts the Republican memo
from last week, which, of course, the president has repeatedly seized upon to claim total vindication.
GORANI: We heard from the president as well today about the potential of another shutdown, another government shutdown, and it's looks like he is
willing to take that risk.
DIAMOND: That's right. Just a few moments ago, we heard from the president saying that he is willing to bring another government shutdown to
bear. You know, we saw the government shutdown for a few days last month, of course.
And once again the president suggesting that if Democrats aren't willing to meet him at his demands with regards to immigration in particular that he
is willing to shut down the government.
We know the last time, of course, the president felt pretty confident that the Democrats bore the brunt of the blame for that shutdown or at least, he
escaped relatively unscathed from this.
And perhaps he's hoping that once again he can gamble with the government funding here to try and score another political win against Democrats.
[15:15:09] GORANI: Well, and some people have accused him of trying to score political points with the death of an American football player. He
sent out a couple of tweets, "So, disgraceful that a person illegally in our country killed Colts linebacker, Edwin Jackson.
This is just one of many such preventable tragedies. We must get the Dems to get tough on the border and with illegal immigration fast." It's only 4
minutes later that he tweeted his condolences to the family. And his critics have said you're basically using the death of this man to score
political points, Jeremy.
DIAMOND: Yes. And this isn't the first time that we've seen the president do something like this, of course. You know, he repeatedly has sought to
capitalize on certain tragedies or certain deaths when it does fit his political agenda.
We've seen him do this not just with the death of Americans, who have been killed by undocumented immigrants, but also a with certain terrorist
attacks where he's immediately capitalize on those to tout his Muslim ban, for example, or to talk about extreme vetting.
What we haven't seen is when there's a political -- when there is a tragedy that, of course, doesn't quite fit his political narrative like a mass
shooting or school shooting in the United States.
Then he's a little bit slower to talk about policy remedies for those issues, but clearly here, this is an instance where he feels he can
capitalize on this or seize at least on this individual's death to try and make this broader political point about a need for tougher immigration
restrictions.
And this is something that we are seeing the White House doing all week as these immigration talks go on. They are focusing on these issues of MS-13
focusing on undocumented immigrants who are committing crimes when really the issue at stake here is these undocumented immigrants were brought to
the United States as children, the DREAMers so to speak.
That is the issue at hand, but of course, the White House trying to make a broader picture about the need to toughen immigration policies in the U.S.
GORANI: All right. One thing, the president hasn't tweeted about is the Dow Jones interestingly. We'll see how it ends this session. Thanks very
much. Jeremy Diamond is in Washington.
Still to come tonight, Poland makes it a crime to say that it took part in the holocaust. The country says that law preserves its dignity. Critics
say the law is rewriting history. That's next.
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GORANI: In Poland soon, people could be sent to jail, to jail for suggesting the country was complicit in Nazi war crimes. Just hours ago,
the president signed a controversial bill banning such statements.
Poland is where the Nazis ran their death camps during their occupation and millions of Poles were killed in the Holocaust. Supporters of the new law
say Poland can't be blamed for those crimes because it did not have a government that collaborated with the Nazis.
Now, some people are very critical of this law calling it an attempt to rewrite history. Israel in particular has objected to it.
[15:20:10] CNN's Ian Lee joins me now from Jerusalem. Why are Israelis objecting to this law? What is there -- what do they think is wrong with
it fundamentally?
DIAMON: Well, fundamentally when you hear from basically anyone across the political divide, Hala, is they are saying that this is trying to rewrite
history, rewrite the Holocaust, and they say there's no doubt for them, you know, that the Nazis were the ones who perpetrated these crimes.
These death camps that were in Poland. These were run by the Nazis, but they say that there were some Poles, who were complicit out with what was
going on in the Holocaust.
We need to remember the Nazis killed 6 million Jews during the Holocaust and that's something that here in Israel is very sensitive topic especially
when you take on the history of that.
Now we heard from Israeli Prime Minister Benjamin Netanyahu said that they need to preserve the truth of the Holocaust and some of the condemnation
has been very strong. We heard from Israel's Minister of Education Neftali Benneth (ph).
He was actually scheduled to go to Poland, but he said you was going to speak the truth there. The Poles rescinded that invitation and he said he
was, quote, "proud of that," and he said also that the blood of Polish Jews cries from the ground and no law will silence it.
So, there is some fear here among Israelis, historians that this could hamper really any sort of look into the history of what took place during
the Holocaust -- Hala.
GORANI: All right. Ian Lee live in Jerusalem, thanks very much for reaction to this controversial new Polish law.
One man's American dream has been shattered after calling the U.S. home for nearly 40 years. Jordanian Amer Adi (ph) came to the U.S. four decades ago
hoping for a new life and a shot at that dream.
But the businessman and father of four children born in America was deported last week, back to Jordan, despite being seen by many as a pillar
of the community in his adopted hometown in Ohio.
Jomana Karadsheh was at the airport for the emotional arrival of Amer Adi. Take a look.
(BEGIN VIDEOTAPE)
JOMANA KARADSHEH, CNN CORRESPONDENT (voice-over): The family reunion no one here wanted. It's been years since Amer Othman Adi (ph) last saw his
mother in her arms now a broken man, deported back to Jordan, the country he left nearly four decades ago to pursue his American dream.
AMER OTHMAN ADI, U.S. DEPORTEE: What happened is (inaudible) and everybody back there knows that. What Trump administration is doing is something
that is (inaudible). You cannot even explain it.
KARADSHEH: The successful businessman and father of four is credited with creating jobs and revitalizing downtown Youngstown Ohio. Ohio Congressman
Tim Ryan describes Adi as a pillar of their community.
REPRESENTATIVE TIM RYAN (D), OHIO: If you would see the breath of support that this gentleman gets from, you know, whether it's his Italian Irish
Catholic congressman or an African-American Pentecostal Republican woman who is supporting him or the working class people I saw in his shop that
day they thought he was going to get deported. This person has brought this community together in Youngstown Ohio.
KARADSHEH: But his visa expired in the early 1990s. Adi did have a valid work permit though and paid taxes he says. His attempts to gain permanent
residency were complicated by immigration officials, who said his first marriage to an American was a sham. It's a claim Adi and his first wife
deny.
Still in statement to CNN, immigration officials say, quote, "Over the last decade, Mr. Othman's immigration case has undergone exhaustive judicial
review at multiple levels of the nation's courts. In each review, the courts have uniformly held that Mr. Othman does not have a legal basis to
remain in the U.S."
Through proposed legislation specific to Adi, Congressman Ryan was able to secure consecutive stays of a 2009 deportation order, but with the Trump
presidency came a crackdown on illegal immigration, tens of thousands have been rounded up by immigration and customs agents.
According to Human Rights Watch many like Adi are deeply rooted in their communities with no criminal conviction.
RYAN: To watch these families get ripped apart is the most heartbreaking thing any American citizen could ever see. It doesn't mean you're not
because you're for these families it doesn't mean you're not for secure border.
[15:25:01] It doesn't mean you're not for making sure drugs don't get in the country. It doesn't mean you're not for throwing people out of the
country who are felons and violent criminals. I'm for all of those things, but on for humane pathway for good people.
KARADSHEH: ICE says it is only enforcing immigration policy and that no one is exempt. Adi is still in shock that he's no longer welcome in the
America he believed in.
ADI: The American dream started 40 years ago for me and build this whole thing from scratch from nothing. Even if anybody will stop that dream, I
won't let them. I'm going to keep the fight going.
KARADSHEH: For now, Adi doesn't know when or if he'll ever see the place he calls home again.
ADI: And the kids and I miss Youngstown. I miss everybody.
KARADSHEH: Jomana Karadsheh, CNN, Amman.
(END VIDEOTAPE)
GORANI: Still to come tonight, it's gone from wow to aww and back again. Stay with us for an update on the Dow.
And he's been holdup in London's Ecuadorian Embassy for five and a half years. Earlier, Julian Assange's lawyer went to court to challenge his
arrest warrant. Hear what happened in a few minutes.
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GORANI: Well, there is around half an hour left to the trading on Wall Street and after those big, big plunges Friday and Monday and today's wild
rollercoaster ride, we are up and it looks like if it continues in this direction, we will finish up for the day up about 1.75 percent.
Claire Sebastian is in New York. What explains this wild volatility today, Claire?
CLAIRE SEBASTIAN, CNN CORRESPONDENT: Well, Hala, I think this is just the new stage that we are at. You know, we saw that big bounce on the open
down more than 500 points. That put the Dow in correction territory, and it really felt like after that the big fun started to move in.
They started to see a buying opportunity because we've never fallen back to that point. The correction really only lasted a few minutes and it's
really been struggling for directions towards the end of the day going up and down.
And now we see this big reversal. The move today is within more than a 1000-point range not quite as big as yesterday's almost 1600-point range,
but still compared to the last year where we've seen remarkable calm on the markets.
This is very much a new phase. A couple of signs that we are looking at as we edge into this last half hour of trading outside of the market, volume
is not as high that was yesterday, it's around 650 million shares being traded right now on the Dow. It was escalating towards 1.3 billion
yesterday at the close of trade. Also, the VIX has come back down at the key measure of volatility. At the beginning of the day it was up around
15, now it's back down to 28. So this certainly still a volatile market but not quite as wild as what we saw yesterday.
HALA GORANI, CNN ANCHOR: All right. Clare Sebastian, thanks very much. Let's get more on the wider implications of what's going on. We'll speak
to our global economic analyst, Rana Foroohar in New York. What do you make of the last three days?
RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: Well, you know, in some ways this really is the new normal. I've been saying for months that we were
eventually going to hit this point. In 2018 when Fed policy changes, when inflation starts to rear up again. When Interest rates start to go up.
These are the things that have actually kept the market low. Low-interest rates, low -- or sorry, kept the market high. Low inflation, low-interest
rates over the last few years. That's changing it. So I think that this a blip. But we're going to see more blips. We're going to see more
volatility this year.
The big question is whether or not these will be sort of moderate. They'll come and go over a few days or whether they'll turn in to something more.
If investors start to feel like, hey, asset prices are going down. They're going to lay off some of the risky bets they've taken the last few years
and then you could start to see a bigger impact on the economy.
GORANI: Right. If this is a blip and we'll see more blips, we'll see more volatility because since the -- in the last 12 months, we've seen nothing
but a steady rise. This has to be seen as something rather healthy, right? Just taking the air out a little bit here.
FOROOHAR: Absolutely. And if you go back two, three decades, a 10 percent a year market drop was no big deal. That was normal. We've gotten very,
very used to something abnormal which is constantly rising up that prices, very low-interest rates, easy debt, easy money. And I do think that that
era is coming to an end. And whether or not that's a healthy thing and the economy continues to grow, or whether or not it's a healthy thing, and we
have a bigger correction and more painful time with that remains to be seen.
GORANI: Right. But I mean, where is the growth going to come from now in the U.S. economy and western economies, in general?
FOROOHAR: So, for starters, it's important to say -- if we look at in historical terms, we're in the end of a recovery cycle. So recoveries
usually last sometime between eight and 10 years. We're 10 years into recovery. So a lot of people, I was one of them, felt that it was probably
not a great policy move to cut taxes and throw a fiscal kerosene on an economy that was already just fine and probably do to slow down the next
couple of years.
GORANI: Because we're adding the trillions of debt in America.
FOROOHAR: Exactly. But politically -- but politically, you're like me, you don't like that. Politically, it's obvious why the Republicans wanting
to do this. They want markets to rise and the economy to continue to grow and for that to power them through the midterms. And of course, the
president wants growth as well. At least through 2018, maybe 2020. So the question is though, is it going to backfire? Because well the economy
overheat forcing the fed to hike up interest rates too quickly which could end the whole party.
GORANI: Yes. Because when growth is good, that's when you cut spending. That's when you try to balance your budget and this is the exact to
opposite.
FOROOHAR: Yes. And, Hala, every single politician does the same thing. It's -- I wish I could say Donald Trump was the only one to do this. But
politicians never want to really grapple with economic reality. That's an issue. The other thing is that they don't deserve as much credit or as
much criticism that they get for the economy. Really, the Feds been running the show over the last several years.
GORANI: I guess going forward, there's going to inevitably be another crisis, but things don't always go up forever. At some point, there's
either a correction, whether it's a severe on or manageable one then we'll wait and see. But then we don't really have the tools to deal with that
correction that we had in -- or that crash or that crisis that we had in 2008.
FOROOHAR: Very important point. Going back to 2008, the Fed had a lot of ammunition to throw at the financial crisis. The Fed over the last decade
has put $4 trillion of money into the U.S. market. Globally, central bankers have put $30 trillion in. And that's amazing that investors right
now are grappling with. Because as interest rates go up, holding debt becomes more expensive, riskier bets become riskier. As Warren Buffet once
told me the tide pulls out and you can see this in swimming without their shorts and that's about we're going to find out.
GORANI: Right. We were talking about the -- we're talking a lot about the U.S. economy. It's by far the largest and most powerful economy in the
world. But Europe, it also you saw in European indices following soon taking some big hits today across the Board. But the European economy has
a similar thing going on where the growth is not bad, but debt is very high. It could possibly rise very soon.
[15:35:09] FOROOHAR: Oh, sure. And you've got an entire -- you've got an entire economy. It's like Italy that really have not recovered fully from
the European debt crisis and could run into problems again. You've also got political populism that could potentially rear us ahead making economic
problems worst. So I think -- you bring up an important point because, on the one hand, you look at the numbers. You say, hey, we're going to
synchronize global recovery. What's not to like?
On the other hand, investors, they have that sixth sense, that finger to the wins that says there's a lot of things to worry about in this economy.
Politics are very fractious. There are great power conflicts brewing potentially between the U.S. and China, Russia. There's many number of
things that we could point to and when markets are worried, that's when investors start to think about all that risks out there in nebulous ways.
GORANI: All right. Rana Foroohar, thanks very much for joining us. Appreciate your analysis.
I mentioned at the top of the hour that big rocket, biggest rocket was making history is going to be shot into space. We're at the Kennedy Space
Center in Florida here. Later this hour, the SpaceX Falcon Heavy rocket is expected to launch. As I mentioned, the most powerful rocket in the world.
These are live pictures. The launch was delayed because of high winds. And there's a window, by the way, up to 4:00 Eastern, which is 24 minutes
from now. If they miss that window, they miss the launch basically. So the window closes in 24 minutes. We're expecting the launch in four, five
minutes. So we'll see if it takes place.
Check out our Facebook page, facebook.com/halagoranicnn. And check out my Twitter as well, @halagorani.
Now, here in the United Kingdom, a judge says the arrest warrant for Julian Assange still stands, but he will consider further material from his
lawyers. The WikiLeaks founder has been hold up in the Ecuadorian embassy in London since 2012, after being granted asylum. Phil Black has this
report. Phil.
PHIL BLACK, CNN CORRESPONDENT: Hala, more than five years ago, Julian Assange moved into the building of the Ecuadorian embassy and refused to
leave. Back then, Swedish authorities was seeking his extradition to sexual assault charges, charges Assange denied. By moving in here, he
skipped the bail. And there's been a U.K. arrest warrant with his name on it ever since. In court, Assange's lawyers argued that warrant should now
be canceled because the Swedish investigation was called off last year. The judge disagreed and said the warrant stands. Assange's lawyers aren't
giving up. They said a challenging of that warrant on other grounds.
Julian Assange has always made it clear that his real concern is that once in custody, he would be handed over to American officials who have made it
clear they want to prosecute him to releasing huge numbers of classified documents.
(BEGIN VIDEO CLIP)
JENNIFER ROBINSON, JULIAN ASSANGE'S LAWYER: Mr. Assange remains willing to answer to British justice in relation to any argument about breach of bail,
but not at the extent of facing injustice in America. This case is and has always been about the risk of extradition to United States and that risk
remains real.
BLACK: Even if Assange is successful in overturning the U.K. arrest warrant, it's possible U.S. officials will make a separate extradition
request to be executed once he leaves the embassy. Right now, it appears he'll have no way of knowing. British officials say, it is their policy to
never confirm or deny the existence of any extradition request. Hala, back to you.
GORANI: Phil black, thanks very much. Still to come tonight, meet the North Korean pop star, handpicked by Kim Jong-un to carry his message to
discuss.
Plus, we could be just moments from the launch of the world's most powerful rocket. We'll take you live to Kennedy Space Center, next.
(COMMERCIAL BREAK)
[15:40:00]
GORANI: Well, athletes and officials are arriving in Pyeongchang as the city counts down to the opening ceremony of the Winter Olympics. That
ceremony is on Friday. The U.S. Vice President Mike Pence touched down in Tokyo today. He is heading to Korea and he says the good feelings about
North and South Korea cooperating in sport should not cloud the overall message that North Korea is still a global menace.
(BEGIN VIDEO CLIP)
MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES: We'll be telling the truth about North Korea at every stop. We'll be ensuring that whatever
cooperation that's existing between North and South Korea today on Olympic teams does not cloud the reality of a regime that must continue to be
isolated by the world community and it must be brought to a place where it ends its provocations. It ends its development and position of nuclear
weapons and ballistic missile weapons. With regard to any interaction with the North Korean delegation, I have not requested a meeting, but we'll see
what happens.
(END VIDEO CLIP)
GORANI: All right. Mike Pence, the U.S. vice president there, on his way to the Korean Peninsula, eventually. And as I mentioned the opening
ceremony is on Friday. We are waiting any minute now for the launch of the SpaceX shuttle. I want to show you some live pictures coming to us from
Kennedy Space Center in just a few moments of the SpaceX Falcon Heavy rocket. The most powerful rocket in the world. It will be -- by the way,
its payload contains a Tesla. This is Elon Musk behind this project. The Tesla will have a mannequin in a spacesuit sitting in the driver seat and
"Space Oddity" by David Bowie will be playing in the car during the launch. Cost, $90 million. It's a bargain.
CNN's Rachel Crane joins me now. She's at Kennedy Space Center. So we're expecting this to happen in a couple minutes?
RACHEL CRANE, CNN CORRESPONDENT: Yes. I mean, Hala, we are now - the countdown clock says we're under two minutes away from launch now. This
launch has been delayed several times today. The launch window does close 4:00 p.m. so SpaceX has then and if anything comes up in the next couple of
minutes, they will have to scrub the launch until their backup window tomorrow between 1:30 and 4:00 p.m. But let me tell you, I'm here at
Kennedy Space Center and everybody is coming out from the surrounding buildings to witness what will hopefully be a very historic launch here
today.
Now, this rocket behind me, once it has lift off, it will be the most powerful operational rocket in the world. The -- at full throttle. It
could have over five million pounds of thrust. That's the equivalent of 18 747 and it will lift off here from launch pad 39A at Kennedy Space Center
which is of course where Apollo 11 sent humans to the moon and -- will be taken out all day has been buzzing. There was over a mile long line to get
into Kennedy Space Center this morning and the visitor center here sold out, viewing tickets in less 24 hours. Thousands of people who have come
from all over the world to witness this historic launch. Now, we are in -- we're under a minute away from launch here. I can't even begin to describe
how exciting this is to be here to witness this historic launch. Almost 30 seconds away.
UNIDENTIFIED FEMALE: Thirty seconds.
[15:45:57] UNIDENTIFIED MALE: Contact on one. This is SpaceX Heavy, go for launch. SpaceX Heavy is configured to fly.
UNIDENTIFIED FEMALE: Stand by for thorough account. Ten, nine, eight, six, five, four, three, two, one.
UNIDENTIFIED MALE: T plus 30 seconds, if you can hear me. Falcon Heavy heading space on our test flying building on history set by the Apollo.
Returning camp 39A interplanetary mission. We're getting ready to throttle down.
UNIDENTIFIED MALE: Supersonic.
UNIDENTIFIED MALE: You've heard the callout, vehicle is supersonic. Side boosters are now throttling back up to full power. With past max -- the
period of maximum, lowest on the vehicle. Next up will be waiting for the side boosters to begin to throttle down. Talking about to booster engine
caught up in separation two and a half minutes into flight. You can see trajectory looks good on the Falcon Heavy. We have park show at the engine
performance nominal.
UNIDENTIFIED MALE: Conducting the service begun.
UNIDENTIFIED MALE: Side boosters have begun to throttle down in preparation for the upcoming shutdown in 20 seconds. Major event coming up
with side booster shutdown and separation.
UNIDENTIFIED MALE: Shutdown. Side Boosters.
(CHEERS AND APPLAUSE)
UNIDENTIFIED MALE: Successful separation. We're coming up on shutdown.
UNIDENTIFIED MALE: Side Boosters. They got the startup.
UNIDENTIFIED MALE: Coming up on clearing separation.
UNIDENTIFIED MALE: (INAUDIBLE)
(CHEERS AND APPLAUSE)
(MUSIC PLAYING)
[15:50:00]
CRANE: Wow. Did you guys see that? That was awesome.
GORANI: Well, there you have it. A lot of excitement at Kennedy Space Center. Cheers, you can hear from the people gathered there at the launch
site. This is the most powerful rocket in the world, as I mentioned. It is -- does contain a Tesla car. This is an Elon Musk project that cost $90
million, to launch this car into space. There was a lot of fans there around it. Big production including David Bowie's "Space Oddity". Is
there life on Mars? It's kind of fun to watch something like this because it's for a change. There's nothing happening. No tragedy, no war. You
see human enterprise that ended with a successful launch. Now, what's interesting is that the boosters around the payload separated, you saw it,
away from the main portion of the rocket. They are hopefully going to be reused. There is a calculation made that they will fall back on earth and
that those boosters will be reused eventually. And as I mentioned, there is a mannequin in a spacesuit in the driver seat of the Tesla car.
So let's cross over to CNN for just -- CNN USA for just a little more on the story.
LEROY CHIAO, RETIRED NASA ASTRONAUT: But, you know, the first stages look flawless. Everything looked great. As Miles was saying, you know, that
crowd of young people in Hawthorne is just really inspiring. I think this is an important moment for exploration and that's what's really unique is
you have visionaries like Elon Musk who want to put their own profits into exploring space and that's why this rocket is being built and flown. It's
much -- it's got much, much capacity just to launch a satellite. So, this is a big moment.
BROOKE BALDWIN, CNN ANCHOR: And we should also point out, I mean I think people are being also, you know, this is an incredible moment but more
light-hearted, there are no Leroy Chiaos on board, you know, the Falcon Heavy rocket, Miles, this is what they call -- there's a dummy payload on
board. You know, there's a hunk of metal. In fact, it's my understanding that Elon Musk actually put up his own Tesla Roadster as part of launch in
this rocket. Is that right?
MILES O'BRIEN, CNN CORRESPONDENT: That is right. That's a used Tesla that Elon Himself drove with a, you know, essentially a crash test dummy. I
would certainly never call my friend Leroy a dummy. But this is a substitute astronaut for now. I mean what they do typically on tests like
this, what NASA would do is put ballast in there, a chunk of concrete or something just to give it some weight.
BALDWIN: Yes.
O'BRIEN: And part of what I appreciate is the enthusiasm and the tweaks and the sense of humor, and frankly, for Elon the cross-promotional
benefits of putting a Tesla in orbit for a billion years around the sun and near Mars.
BALDWIN: And by the way, I've got one more voice. Rachel Crane who is actually there, lucky, lucky fellow space geek who's there taking it all
in. Jumping up and down. I feel your enthusiasm jumping in front of the camera. Rachel, talk to me and tell me also about these boosters.
CRANE: Right. Well, Brooke, we did just see two boosters coming down moments ago. But the entry burn was shut down. We don't see them anymore.
But I do hear people cheering around me. There's a couple of buildings -- oh! There's the sonic boom! Woo! Wow. Brooke, I can't even begin to
describe the excitement around me. Everybody come out from the building here at Kennedy Space Center.
BALDWIN: Pan the camera, Rachel. Pan the camera over.
CRANE: Can you guys turn the camera over to see it?
UNIDENTIFIED MALE: No. There's a building.
CRANE: Sorry, Brooke. There's a building blocking the way.
BALDWIN: Oh, there's a building. No worries.
CRANE: Seeing this, these incredible landings. Unfortunately, I can't see them myself. But to describe the feeling of this launch here at Kennedy
Space Center. This historic launch of Falcon Heavy. I mean this is one for the books, Brooke. It was really truly incredible.
Yesterday I spoke with Elon Musk. He was, you know, running through all the things that could possibly go wrong here. He said that he would
consider it a success if the rocket just simply cleared Launch Pad 39A. Of course, this is an historic launch pad. This is where, you know, Apollo 11
sent humans to the moon. But had it been destroyed with this launch, it also would have delayed all the further launches. They said that Falcon
Heavy could be ready to re-launch in three to six months. Of course, that would have been delayed if the launch pad was destroyed.
As we saw today, it was successful. It was not destroyed so that will not be a problem. We're waiting to see just how successful it was. You know,
as you were speaking with Miles, there is his own personal Tesla Roadster on board with that space dummy on there playing David Bowie "Space Oddity".
We don't know exactly how far is gotten at this point. We will keep you updated as we get all this incredibly exciting space information.
[15:55:11] BALDWIN: I love, love, love the enthusiasm. Rachel Crane, my friend, thank you so much.
I've still got Miles O'Brien and Leroy Chiao with me. And so, Miles, let's go back over to you. Where is exactly is the rocket going?
O'BRIEN: It's going in a -- what they call a highly elliptical orbit. And it orbits actually around the sun. And it will sort of meet up, you know,
kind of race track style merging with Mars on occasion. So it's about 250,000 miles at its farthest distance from earth so it's a pretty decent
stretch of the way to Mars. You know, obviously not entering Mars orbit or landing on Mars, but that Tesla Roadster will just be orbiting there for
who knows how long? For the eons with the dummy looking out the window, into the void.
GORANI: OK. Well, there you have it, an exceptional day at the Kennedy Space Center with the world's most powerful rocket launch there. A little
bit of a taste of the coverage from our sister Network, CNN USA.
I just want to recap Wall Street right now, because we've been covering that extensively. You saw it yesterday during this show as well. Very
volatile trading. And we're seeing probably one of the biggest point increases in history for the Dow after having seen the largest in three-day
point decline yesterday. We're up about 500 points, pretty safe to say. We are going to close in positive territory of two and a tenth percent.
And while volatile, there are a lot of reasons for that. My colleague Richard Quest on "QUEST MEANS BUSINESS" will pick it up after a quick
break. I'll give you all the background and all the latest on the markets and all the other days, top news stories. I'm Hala Gorani. I'll see you
soon.
(COMMERCIAL BREAK)
END
