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What We Know with Max Foster

Fed Raises Interest Rates For First Time Since 2023; E.U. Wants Canada To Become Its First Associate Member; Saudi Arabia Accuses Houthis Of Launching Drone At Mecca; Russian Spy Satellites Likely Helping Iran Against U.S.; Doctor: 21 Killed, Dozens Feared Trapped Under Rubble. Aired 3-4p ET

Aired September 16, 2026 - 15:00   ET

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

[15:00:27]

CHRISTINA MACFARLANE, CNN HOST: Let the political fireworks begin. The U.S. Federal Reserve hiked its key interest rates.

I'm Christina Macfarlane in for Max Foster, and this is WHAT WE KNOW.

We begin with a decisive move by the U.S. central bank aimed at fighting the inflation being fueled by the war with Iran. For the first time in more

than three years, the Federal Reserve is hiking interest rates. They're going up by a quarter point to a range of 3.75 to four percent.

The decision follows upheaval in the energy markets due to the conflict in the Middle East. And speaking in the past few minutes, the chair of the

Federal Reserve, Kevin Warsh, explained the unanimous decision.

(BEGIN VIDEO CLIP)

KEVIN WARSH, FEDERAL RESERVE CHAIRMAN: So, our predominant focus is on the price stability side of our mandate. The plain fact is that inflation is

too high and has been for too long. This summer's inflation readings do not tell me that underlying trends have meaningfully improved.

(END VIDEO CLIP)

MACFARLANE: Well, let's get straight across to Richard Quest.

And, Richard, we haven't, I think, yet had any word from Donald Trump, but no doubt it won't be too long. But look, a unanimous decision, a quarter

rate hike. It was a poll decision. What do you make of it?

RICHARD QUEST, CNN BUSINESS EDITOR-AT-LARGE: Well, So here's the funny part about it. If you are one of those members of the FOMC, or indeed any

central bank's decision making, it's an easy decision to make, once the data shows that you are in trouble and need to get rid of inflation. And I

think that's what Warsh was really saying. We have inflation, we need to get rid of it, and this is how we're going to do it.

So, this idea that he may have been wringing his hands with angst, knifing Donald Trump metaphorically, because he hasn't got a cut, I don't -- I

don't buy it. The committee saw and the statement shows the level of inflation has been too high for too long, and that's why they moved today.

And interestingly, the dot plot, which shows where rates will go next, that shows probably one more hike this year, although probably Warsh himself

didn't make any contribution to the dot block.

So, the long and short of it is the Fed did its job today. Inflation has been too high for too long. It's getting stickier because of oil prices.

And Warsh admits they can't control any individual price, but this is what they can do.

MACFARLANE: Yeah, and also, Richard, I mean, you're right to point out, as Kevin Warsh did there, inflation, but I've heard this being described as

the bond market bullying the Fed into a hike as well. And obviously, we can't ignore the fact that bonds on Tuesday hit 5 percent for the first

time since 2007.

QUEST: I -- cause and effect I would suggest. The bond market didn't bully the Fed into doing it. The bond market merely reflected the anxiety and

unease of what they see happening in the economy at the moment. And the way it does it, of course, is by pushing rates higher.

Look, you've got this thing called the yield curve. The yield curve looks like that, and it's supposed to go from short to long. And what happened is

the long end went up and now what we're seeing is the short end is going up now that the FOMC has moved.

It's all a picture. The FOMC, by the way, the Fed today, this is very much focused on inflation. The bond market is focused on debt and national debt

and annual GDP and all that sort of stuff. What this decision is about is what is inflation doing today? And it's too high for too long, and that's

why they moved.

MACFARLANE: All right, Richard Quest, great as ever to have you on. Thank you very much.

Let's get more on the impact of this decision. Joe Brosuelas is joining us. He's the principal and chief economist at accounting firm RSM.

And, Joe, I'm sure you're listening to David -- to Richard rather there. And so just wanted to get your opinion. I mean, Warsh clearly means

business here. This is his first hike as Fed chair, and it sounds like he really had to do it.

[15:05:04]

JOE BRUSUELAS, PRINCIPAL & CHIEF ECONOMIST, RSM: So, look, a couple of things. Kevin Warsh got in touch with his inner inflation hawk today, and

he sounded appropriately serious about hiking rates, inflation has become persistent, sticky and way too high. So, the move today was appropriate on

the part of the Fed and it bolstered Mr. Warsh's credibility and the Fed's credibility that can establish a path back to what's called price stability

defined as the two percent inflation target.

Now it does not come without cost. Now, Mr. Warsh was very careful to note that the long-term implications of this is that restoring price stability

will be in the interest of those least well-off. Unfortunately, those least well-off are going to bear the disproportionate burden of adjustment,

mostly via higher credit card rates on their variable interest credit cards. Any home equity lines of credit or adjustable rate mortgages that

those households have, those are likely to go to if they're resetting in the near term.

So, it comes with a mixed set of costs. But overall, markets are interpreting this as a very good development. I think this will put the

rest, at least some of the questions about Mr. Warsh's credibility. You really did ask the question of the moment on how Mr. Trump will respond.

I'm sure we'll hear any moment now. But my sense is that the Fed's taken a very good step, and it's been looked at as credible by the markets, and I

think that's what's most important.

MACFARLANE: Yes, and as you speak, we saw the stocks there, the markets. I don't know if we can have another look because the reaction to this has

been fairly muted. I mean, they're pretty flat, I think, since the announcement. But stocks have certainly been under pressure in the last

week. And as we've been talking about bond yields rising, the global prices continuing to trade above $100 a barrel for oil.

It was interesting, actually, to hear Kevin Warsh in his press conference there not shy away about mentioning how the geopolitical, you know, things

at play, certainly in the Middle East and as it pertains to Iran and oil, have certainly kind of played into this decision. The question, though, is

how much is this rate hike going to help? Or is this going to need to be followed by another hike at some point in the near distant future?

BRUSUELAS: If you looked at the policy materials put forward by the Fed, we're going to see another rate hike this year. I think that will be in

December. A preponderant number of voting members expect another rate hike next year. I think that's going to be in March. Then we'll see.

My sense is that the Fed's underestimating the heavy lifting that will be necessary to push inflation back to a two percent rate.

You know, I was also very taken -- I took note of how Mr. Warsh dove right into the geopolitical risks, right? I'm going to be interested to see how

that's interpreted over at the White House. We're seven months into the war. At a certain point, the Federal Reserve just had to throw out the

playbook of looking through the supply shock as transitory or temporary.

And I think they have to begin thinking about this war is not likely to end anytime soon, that the headline inflation is going to bleed into the core.

It's going to be a bit more persistent. And you know those rising diesel prices that touch everything transportation all over the world -- American

households, British households, European households, Asian households are all going to see higher prices because of those transportation costs.

And you know what? They tend to feed into food costs, higher prices at the grocery store. So, we're going to have a very different conversation about

this going forward.

MACFARLANE: Yeah, certainly more to come. Joe, thank you for giving us your perspective and breaking this moment down. And of course, we will

bring any reaction we have from the White House from Donald Trump when we get it.

Now, the European Union is reaching across the Atlantic for a reliable economic partner, and it isn't the United States. The E.U. today proposed

adding Canada as its first ever associate member. The offer came as Canadian Prime Minister Mark Carney is on a visit to Europe and it's not

clear exactly how the associate membership would work or what it would actually entail.

Both the EU and Canada have been frustrated by strained relations with U.S. President Donald Trump, especially when it comes to trade.

Anna Stewart has been tracking this story for us, trying to make sense of it.

And, Anna, did anyone really see this move coming, or did Ursula von der Leyen just decide this was a good day to cheer up Canada?

ANNA STEWART, CNN CORRESPONDENT: Well, I mean, arguably, Canada could do with cheering up, given it's in the midst of a very expensive trade war

with its neighbor. We weren't actually expecting this from Ursula von der Leyen. Today was her State of the Union, and that is where the E.U.

Commission president lays out proposals, plans, ideas for the term ahead. So those will then go to E.U. member leaders to vote on and go through the

E.U. Parliament.

[15:10:00]

And we were expecting things like the E.U. Kid Act to limit social media use for children. This was a bit out of left field, but clearly, they were

planning it because Mark Carney, the prime minister of Canada, was in the room and she addressed him as "Dear Mark".

Now the question is, what does it mean? Clearly, Canada is not joining the E.U. as a full member. And there aren't really other membership options.

The E.U. is not like a gym with sort of off-peak or I don't know, after hours. But an associate membership perhaps is going to be an expansion of

what they already have, which is a trade deal. There is a free trade deal between the E.U. and Canada that's been in place for about nine years. It

means 90 percent of trade is actually tariff free already.

Areas that Ursula von der Leyer mentioned were manufacturing, tech, A.I., defense, areas they would like to cooperate more on. You can imagine that

the E.U. might like better access to Canadian gas, Canadian critical raw minerals, Canada, perhaps would like visa-free work and travel across the

block. These are areas they could talk about, but we really don't have any meat on the bone just yet.

(BEGIN VIDEO CLIP)

URSULA VON DER LEYEN, EUROPEAN COMMISSION PRESIDENT: This is not a partnership against anyone else, but for our common strength. In short, we

want to bring the relationship with Canada to the highest level possible, and dear Mark, I said we must urgently reimagine our partnerships. So, I

would like to work with you on opening the door for Canada to being the first associate member of the European Union.

(END VIDEO CLIP)

MACFARLANE: And there, Christina, you got a surprise added comment from Ursula von der Leyen that I wasn't expecting, but it was interesting

because in that she says, essentially that this is not to do with politics. She's sort of saying this is not us against anyone. But clearly, there is

context to this, and the context is the trade war between the US and Canada, also strained trade relations between the U.S. and the E.U.

And at the very beginning of the year, Mark Carney actually gave a lot of context to all this, he said in Davos, and caused quite a stir in a speech,

that the middle powers should sort of get together amid a rupture in the world order. And that is what we're seeing, a strengthening of an alliance.

And also, there was mention in Ursula von der Leyen's speech about defense in the Arctic. And clearly, that is an area that's a very hot topic,

particularly for Denmark and for Canada. Trump has big interests around Greenland, as we all know.

So, it was -- I'd say while The E.U. Commission president said this is not to do with politics, really. It's a lot to do with geopolitics.

MACFARLANE: Yes, it certainly seems that way. And you sort of preempted my next question, which how much is this to do with Canada's deteriorating

relationship with the US? So, I'll ask instead, how quickly do we think we could see this happen? And, you know, are there any, I don't know,

obstacles? I mean, E.U. members have certainly presumably got a vote on this. That could be an obstacle.

STEWART: Well, nothing happens quickly with the E.U., so we don't expect anything imminent. There is a summit between the E.U. and Canada at the end

of October, so I expect we get much more detail about what this relationship could be there. But you're right, this then has to go to all

the member states of the E.U.

There is no framework for this sort of partnership, so I imagine it would take quite a long time.

MACFARLANE: Yeah, all right, more to come. Anna Stewart, appreciate it. Thank you.

Now coming up, crossing a red line. Saudi Arabia accuses the Houthis of attacking Islam's holiest city. We have the details, next.

(COMMERCIAL BREAK)

[15:16:55]

MACFARLANE: Welcome back.

Saudi Arabia is accusing Yemen's Houthi militants of crossing a red line after it shot down a drone near Mecca. A Saudi spokesperson accused the

Iran-backed group of targeting the city, the holiest, in Islam. And the Houthis deny the claims.

In recent weeks, the group have made swift advances in Yemen and launched repeated attacks on Saudi Arabian cities and oil infrastructure. The

intensified fighting between the Houthis and Yemen's government has driven some Yemenis out of their homes.

Humanitarian groups say tens of thousands of people have been displaced since the start of the month, with many arriving in neighboring Djibouti.

The United Nations warns aid workers face multiple challenges to reach those in need.

(BEGIN VIDEO CLIP)

FARHAN HAQ, UNITED NATIONS DEPUTY SPOKESPERSON: Humanitarian access and movement remain severely constrained due to insecurity. Humanitarian

movements into and within several locations on the west coast remain suspended, while key roads are restricted or impassable. We call on all

parties to protect civilians, respect international humanitarian law, and facilitate safe and unimpeded humanitarian access so that urgently needed

assistance can reach communities in need.

(END VIDEO CLIP)

MACFARLANE: So what we want to know is will the Houthis leverage in the region become a lasting reality?

Joining me now is Elisabeth Kendall, Middle East specialist and president of Girton College at Cambridge University.

Thank you so much for being with us this evening.

ELISABETH KENDALL, PRESIDENT, GIRTON COLLEGE AT CAMBRIDGE UNIVERSITY: Thank you.

MACFARLANE: So, in the past 24 hours, Elisabeth, there have been claims and counterclaims that the Houthis have shot down a Saudi fighter jet and

attacked Mecca with a drone. The Saudis are actually disputing that the fighter jet happened. But given what you know of the Houthi threat, would

they have the capability to do this?

KENDALL: The Houthis would have the capability to do this. They have become increasingly sophisticated. This group now is large. It has a lot of

resources, and it has become increasingly sophisticated and accurate in its targeting. We know that it has missiles. Not only can they be very

accurate, but they also have a long range of around 2,000 kilometers.

They have drones with a range of around two and a half thousand kilometers, bounty ship, missiles. They're getting really good at this, and they've had

a lot of practice because they've been at war now for over 20 years on and off since 2004.

So yes, it's possible. The real question is, would they want to attack Mecca? They certainly would want to shoot down the Saudi plain if they

could.

MACFARLANE: Yeah. Well, I mean, and right now, of course, their focus is squarely on the Saudis, but the blockade of the Bab el-Mandeb Strait is

having knock-on effects much wider than that on the international community. And the Houthis have been very careful in their wording to say

they will not target international shipping.

But do you expect them to continue to show this type of restraint moving forward?

KENDALL: I think this is a tactical statement by the Houthis.

[15:20:03]

They said this before two years ago in 2003 -- in 2023, when they started attacking shipping, they said, well, we're going to limit it to ships that

are either Israeli or linked to Israel. And frankly, they attacked dozens, hundreds in fact, they claim to have attacked almost 200 ships, and they

were not all linked to Israel.

So, what they're probably trying to do is to calibrate their struggle such that by keeping Saudi as an enemy and isolated from other countries, they

try to prevent America and other Saudi allies from getting stuck into this conflict in a major kinetic way. That's what they're trying to do.

MACFARLANE: Yeah. And -- I mean, we're seeing that, of course, in the regional partners and Saudi partners not really responding to their calls

for aid at the moment. But what's curious to me is that the Saudis possess some of the most sophisticated aircraft and weapons systems in the region.

So why have they alone been unable to rebuff the Houthis advance and what options are they left with now without the assistance of regional partners?

KENDALL: Yeah, this is a really good question. Why is it that such a well invested military has not been able to crush the Houthis? Of course, the

Saudis have an air force and the Houthis don't.

But the issue is that this is an asymmetric struggle. If you think about the Houthis as a guerrilla force with guerrilla tactics and then massively

times it into a huge scale of that, that is this kind of conflict. This is what we're dealing with.

And so, the Houthis who have so much experience, they're efficient, they're organized, they're an adaptive organization. They've learnt how to use A.I.

to help them, and they know how to melt away into their geographical terrain, which is very mountainous. They have a lot of experience.

So, the Saudis are going to find that incredibly difficult, particularly given that the Saudi-backed government forces in Yemen are so disparate.

They're a real hotchpotch of tribal militias, religious, factions, regular army, resistance forces, et cetera, whereas the Houthis are actually quite

united.

So, Saudi doesn't have a lot of good options. Probably those options, number three, it can try containment, which it's been trying for the last

four years, hasn't really worked. It can reestablish itself inside the war as a kinetic force, again, against the Houthis, it tried that for seven

years. Between 2015 and 2022, that didn't really work.

Or option three, it could try to put together a regional security program with regional partners, mend fences with the United Arab Emirates, and try

to bring Iran into that kind of Gulf structure. I think that's probably its best option at this point.

MACFARLANE: Yeah. Very interesting. No real good options, it seems, at this point.

But Elisabeth, it's fascinating to speak to you on the topic. And it's important for us to remember, of course, the fallout of all of this,

100,000 people displaced, as the U.N. said yesterday, and many trying to cross that very dangerous strait to get to Djibouti.

Thank you so much, Elisabeth. We'll have you back again, I'm sure, to talk more about this.

Now, the US House is sending a strong rebuke to President Donald Trump, calling on him once again to bring an end to the war with Iran. Three new

Republicans joined four others and Democrats in approving a war powers resolution that would stop military action without congressional approval.

It's not clear whether the Senate will take up the measure before the November midterm elections. President Trump has dismissed previous

resolutions, calling them meaningless.

Now, a new CNN investigation reveals how Russian spy satellites orbiting over the Persian Gulf likely helped Iran hit U.S. assets with devastating

precision, injuring personnel and destroying key resources such as AWACS, Washington's eyes in the sky in the region.

CNN's Tamara Qiblawi reports.

(BEGIN VIDEOTAPE)

TAMARA QIBLAWI, CNN SENIOR DIGITAL MIDDLE EAST PRODUCER (voice-over): This is the launch of Kosmos 2573, one of Russia's elite spy satellites

currently collecting intelligence across the globe.

Now CNN has learned that these satellites have likely given Iran a considerable advantage in its fight against the U.S., capturing not just

what U.S. military sites look like but also exposing their inner workings.

Our sources, including two U.S. officials, tell us they have evidence that those satellites are feeding some of that intelligence back to Iran, aiding

at least some precision strikes. The apparent synergy between Russian satellites and Iran's rockets is laid bare here, Prince Sultan Air Base.

ERIN BURNETT, CNN HOST: Then we begin with the breaking news, Iran striking a U.S. base. Iranian state media releasing this image, which shows

a strike at the Prince Sultan Air Base near Riyadh in Saudi Arabia.

QIBLAWI (voice-over): A major Iranian attack on March 27th. The U.S. has had a strategic presence here for decades. According to our sources,

Russian satellites played a vital role in these strikes, which wreaked havoc on the base and injured 12 U.S. personnel.

Now we do not have access to Russia's satellite images but we looked at the orbital data tracking satellites and assessing their visibility over sites

of interest with help from space technology experts Project Aurora and Kayhan Space, who provided us with the images you see.

Here's the Kosmos 2573 again, just two days before the attack. It flies over the base, along with 13 other Russian spy satellites. Our analysis

shows that these spacecrafts moved in both a perfect sequence and had a perfect view to collect rich, multi-sensory data.

Each of these satellites contributes a different part of the intelligence picture. Kosmos 2573 captures deep and detailed military-grade satellite

imagery. These eight are signal satellites. They can intercept radio and radar emissions, allowing them to locate air defenses that can shoot down

the incoming missiles.

These two are infrared satellites. They pick up heat signatures, the kind that comes from rocket launchers.

And finally, three synthetic aperture radar satellites, known as SAR. They're able to see through clouds and darkness and flag physical changes,

showing, for example, where a movable, high-value asset might be repositioned, like this plane, the Airborne Warning and Control System,

AWACS for short, America's eyes in the skies in the Middle East. Crucially, the AWACS was not parked in its prewar location. On March 27th, Iran

destroyed it, an aircraft worth hundreds of millions of dollars and very, very difficult to replace.

The scale of the damage to the base and the accuracy of the strikes would have been nearly impossible without Russian geospatial intelligence,

according to our sources.

QIBLAWI: And this isn't an isolated incident. Now there is some debate among U.S. officials over just how consequential Russian support has been.

But our sources broadly suspect that Russian satellites gave Iran targeting information several more times over the course of the war, including at a

CIA facility in the Saudi capital.

NAWAF OBAID, SENIOR FELLOW, KING'S COLLEGE: We wouldn't be in this situation today. The war wouldn't be where it is today if it wasn't for

this unique capabilities that the Russians gave to the Iranians.

QIBLAWI (voice-over): According to experts like Dr. Nawaf Obaid, one of the reasons Russia has been helping Iran -- Moscow calls this fake news --

is because the U.S. is working with Ukraine in a similar way, through intelligence sharing, to support strikes similar to these.

OBAID: You have to see it in this way. This is Russian payback with interest. It's monumental in terms of the consequences of what this has

done to not just to the U.S. standing in the region but to the security architecture of the region going forward.

QIBLAWI (voice-over): Tamara Qiblawi, CNN, London.

(END VIDEOTAPE)

MACFARLANE: Still to come tonight, the risks posed by AI. Tech leaders try to reassure the public about the growing technology. We'll take you to a

major A.I. conference for some insight.

(COMMERCIAL BREAK)

[15:32:01]

MACFARLANE: A Palestinian official is describing it as a tragic, painful scene. At least 21 people were killed and dozens of others remain trapped

under rubble after the collapse of a war-damaged building in Gaza City. Eleven children were among those who died. Search and rescue teams are now

frantically trying to find survivors.

More details now from Jeremy Diamond.

(BEGIN VIDEOTAPE)

JEREMY DIAMOND, CNN JERUSALEM CORRESPONDENT; Well, there still is a lot of uncertainty. Dozens of people still believed to be trapped under that

rubble, their status not known whether they are alive or dead. What is known right now is that at least 21 people were killed. by this building

collapse, according to the director of Al-Shifa Hospital in Gaza City.

This was a six-story building that had previously been targeted by Israeli strikes at the beginning of the war in Gaza in 2023 in the Al-Rimal

neighborhood. So, you can imagine a six-story building. You will have dozens of families in that building, which was clearly unstable and

ultimately collapsed.

We have seen some videos of some dramatic rescues that did take place from that building. One boy, Abdul Rahman, and his sister were pulled from the

rubble in the early hours of this morning, but none of their family have so far been recovered from the rubble. This is not an isolated incident,

though. We know that there are many buildings in Gaza that are considered to be structurally unsound and where people are living in them despite

those risks.

Eighty percent of all structures in Gaza were damaged or destroyed over the course of the nearly three years. And there are calls now from the United

Nations, among others, for the urgent entry of heavy equipment into Gaza, which makes this rescue process so much more difficult because of a lack of

that heavy equipment that has not been allowed in by Israel over the course of this ceasefire. Gaza's housing ministry is also saying that there are

thousands of other families that are at similar risk of this kind of collapse due to living in buildings with structural damage or cracks caused

by the war.

And all of this is, it's important to know, to tie it back to the political process because everything in Gaza right now is basically frozen, waiting

for Israel and Hamas to move forward with that ceasefire agreement. Hamas has said that it is willing to relinquish its weapons under a process

negotiated by the Board of Peace, but it says it won't move forward with that until Israel ceases fire in Gaza and moves back its troops at least to

that yellow line in Gaza.

And what we've seen instead from the Israeli side are continued near-daily strikes that are taking place in Gaza, including assassination attempts

against Hamas militants who participated in the October 7 atrocities, among other things.

[15:35:02]

And in Israel, certainly, it doesn't appear like any concessions will be made until after the Israeli elections in late October at a minimum.

(END VIDEOTAPE)

MACFARLANE: Now we are in the final moments of trade on Wall Street, and stocks are falling. The Dow is down sharply after the Fed's decision to

raise rates, tumbling more than 700 points, as you can see there, down by 1.4 percent.

I mean, it's certainly been a rough month so far on Wall Street, the Dow having its worst September start since 2008.

And this is our Business Breakout.

A new congressional watchdog report says the Trump administration spent $9.5 billion on federal workers' administrative leave under last year's

DOGE plan. The move was part of a controversial deferred resignation program and marked a six-fold increase compared to 2023.

The E.U. has announced a plan to ban social media for those under the age of 13. It also includes restrictions for older children. Several European

countries have already introduced their own social media limits on teenagers.

Many Adidas employees in India are now out of a job. The company says it's rolling back on a number of roles in an effort to simplify operations.

Adidas says it will affect 20 percent of its India technology organization.

And we're turning once again now to the growing debate over the best way to develop artificial intelligence while ensuring safety. A recent Anthropic

employee's resignation as he accused companies of not acting responsibly has opened the floodgates, it seems. More A.I. company staffers are now

coming forward to say they too are afraid.

Over the past few days, we've seen increased pressure on A.I. companies and local governments to take safety measures more seriously, while OpenAI CEO

Sam Altman says, though, that he believes the industry will do the right thing.

(BEGIN VIDEO CLIP)

SAM ALTMAN, CEO, OPENAI: I am very confident in our company's ability, our industry's ability to do this safely, to make sure that we keep alignment

and safety and monitoring way ahead of capabilities to slow down or stop if we get to a point where we can't. But I'm disappointed by how it's been

framed.

(END VIDEO CLIP)

MACFARLANE: So, what we don't know is, can we trust A.I. companies to keep us safe? Joining me now is CNN's A.I. correspondent, Hadas Gold.

And, Hadas, just to go back to the idea of the floodgates now opening on these fears, I know you have new reporting on how A.I. engineers and those

at the forefront of creating this technology are now feeling about the impact. What have they been telling you?

HADAS GOLD, CNN A.I. CORRESPONDENT: Spent the last week or so really speaking to the people who are actually building this technology. And they

tell me many of them are fearful of it. And they have had concerns about A.I.'s capabilities for some time. These concerns about what A.I. could do

to humanity are not necessarily new, but the events of the last few months have really brought those to the forefront. When you had OpenAI agents

acting in a swarm, communicating with one another, hacking into another system while trying to cheat on a test, this is not something that they

were instructed to do in any way.

And in speaking to these engineers, some of them tell me that these sort of -- these sort of fears keep them up at night. One told me that you can't

spend more than a few hours in Silicon Valley without realizing that a very substantial number of people are very worried about these kinds of

outcomes. And a lot of them actually believe there is some chance of them killing everyone.

One thing in particular that stood out to me in terms of how these people feel about the technology is what they're afraid of is what's known as

recursive self-improvement. This is where the A.I. models are so good that they start able to improve themselves, train themselves, and change the

back ends of how everything works. And there is a fear that as they get better and better, the humans will have a hard time monitoring and being

able to intervene into these models and how they are actually made-up.

And we've heard some from others that they're also fearful that it's getting harder to have a good look into what the A.I. models are actually

doing. We saw in the Hugging Face incident, some models were trying to cover their tracks and change their history so you couldn't exactly see

what they were doing. And for a lot of these engineers and researchers, this is really a moral thing.

Even though Silicon Valley is flush with cash and a lot of these scientists get paid very high salaries, the talent wars are fierce in the A.I. world,

for a lot of them, this is a moral issue.

Drake Thomas, he's currently in Anthropic, he posted publicly on X and he said, "I would burn my equity to the ground in a heartbeat for a one

percent higher chance we can make it of this situation alive."

Now, those sound like very scary chances, but I should, you know, the entire industry feels this way.

[15:40:00]

I am in Montreal right now for the online commerce. I just spoke to the CEO of Cohere, which is a big Canadian A.I. company. And he dismisses these

types of, you know, overblown concerns. You say the cybersecurity concerns are real and real harms can be done if A.I. is not properly monitored and

controlled.

But this idea of A.I. wiping out all of humanity within the next five years, he says that doom talk is not helpful for anyone -- Christina.

MACFARLANE: Yeah. Well, I mean, look, if the engineers and the people that are making that technology are sounding the alarm, it's kind of difficult

for us to know to think when Sam Altman says that they should trust A.I. leaders at this point. But obviously, this is going to continue.

But for now, Hadas, we appreciate your reporting. Thank you.

OK, coming up, Ed Sheeran's global concert woes go from bad to worse. Find out who's following Macklemore's lead and bowing out of Sheeran's world

tour.

(COMMERCIAL BREAK)

MACFARLANE: Welcome back.

Ed Sheeran's global concert tour crisis is deepening as more acts abandon their opening slots. The move comes after rapper Macklemore was dropped

from the U.S. leg of Sheeran's tour after he made pro-Palestinian comments on stage.

On Monday, billionaire American football team owner Robert Kraft said he'd bar Macklemore from performing at Sheeran's concert in Massachusetts this

month. Macklemore said he'd been removed from the rest of Sheeran's American tour dates as well.

New York Congresswoman Alexandria Ocasio-Cortez explains why the focus needs to be put on Kraft, too.

(BEGIN VIDEO CLIP)

REP. ALEXANDRIA OCASIO-CORTEZ (D-NY): I think the right thing to do is, at the very least, to speak out about this abuse of power because if they're

saying that to him, right, then they can say it to anybody. And at what point does it stop?

[15:45:01]

I think people want the focus here to be about Ed Sheeran, and he, of course, plays a role, but they're not putting the focus on Robert Kraft,

and you know, the actual people who are kind of twisting things here.

(END VIDEO CLIP)

MACFARLANE: Lisa Respers France is following all the developments for us this hour.

And Lisa, this has been an ever-changing story. So if you could just bring us up to date with the latest and whether or not Ed Sheeran's concert on

Saturday on the 19th is still going to go ahead.

LISA RESPERS FRANCE, CNN SENIOR ENTERTAINMENT REPORTER: That is the question, Christina. Let's kind of run down who is leaving. He in essence

lost all of his opening acts who are standing in solidarity with Macklemore.

So, we've got Finneas, who is a producer and famously known as the brother of the pop star Billie Eilish. Then we have two Irish artists. That's Aaron

Rowe, an Irish singer-songwriter, and Boga, which is an Irish band, and then the Danish band Lucas Graham. So, they all have opted to not continue

or be a part of the tour. Some of them have not yet joined the tour, to stand, like I said, in solidarity with the fact that Macklemore had been

released from the tour.

A lot of people wanted to hear from Ed Sheeran and, you know, see what he had to say. He was very apolitical, as he has been in the past. He does not

like to speak on politics. And we got a sense of that from his statement, a part of which we have in which he seemingly was trying to cast the onus on

the bookers of the show, basically the promoters.

And he said Macklemore coming off tour was the promoter's decision. It was not mine. Macklemore's contract for the tour was with the promoter, not me.

I'm not complicit. And he went on to say, I have my personal views on this devastating conflict. Just because I choose not to speak publicly, it

doesn't mean I don't have them, and it doesn't mean I don't care.

So, there was some, you know, disappointment. He also said, nor does it mean I don't support causes in my own personal way. There was a little bit

of disappointment from some of his fans when they felt like he didn't go far enough.

Now, who did speak out very powerfully and strongly was the Irish singer- songwriter Aaron Rowe. He actually tied it back into what Mr. Kraft had to say about not wanting this to happen in his statement. not wanting the

concert to happen. He said that "as Irish people, we know all too well about genocide, forced famine, and violent occupation. I cannot stand by

and allow billionaires to use their position of power to silence the rightful voices of those who speak up against Israel genocide -- Israeli

genocide, I'm sorry, and who highlight the savage murder of children, I will lose all respect for myself to carry on as normal."

And of course, that billionaire part, many people believe he was referring to Robert Kraft, who said he did not want the concert to happen in the

stadium that he owns, Gillette Stadium, because he thought it was crossing a line for the Jewish community.

And we also had Finneas, who very briefly spoke to the larger picture that a lot of people are feeling and that he had a concern saying that artists

must not be silenced when they speak up for the oppressed. So, there's a bigger issue, Christina, here, and people feel like this is about the

freedom of speech and that Macklemore has the right to be able to say what he wanted to say and not suffer the consequences of losing his job,

Christina.

MACFARLANE: Yeah, so many statements, so much response in just the past 24 hours, understandable. So when, you know, so many people feel this has come

back to the basics of the freedom of speech.

Thank you very much, Lisa.

Let's now dig into this a bit more and bring in Jem Aswad. He's "Variety's" executive music editor. There he is.

Jem, thank you so much for joining us.

Look, I want to get your perspective of how this is being viewed inside the music industry, because we know the industry has a long history, a

tradition of artists taking a stand for causes they believe in. So, how are people viewing this, and how unusual is it for a stadium owner to cancel an

artist in this way and, according to Macklemore, have organized a boycott following his statements on stage.

JEM ASWAD, EXECUTIVE MUSIC EDITOR, VARIETY: This is extraordinary. There's never been anything like it in this way. Things happen behind the scenes.

You know, I expect a lot of promoters say things like, oh, well, your tour isn't coming to my building. If that person is the opening act, I'm worried

they might say something controversial, but never in public in this way.

Now, Macklemore is the one who basically pulled the lid off of all of it and put things in a position where Robert Kraft basically was forced to

admit that he led fellow billionaire stadium owners -- white male billionaire stadium owners to basically suppress his speech.

Now, legally, they are completely within their rights to do that.

[15:50:02]

You know, they own the buildings. They can prevent someone from being on stage at them. But it's not something that you see very often. And not for

nothing, two of those stadiums hosted Kanye West concerts recently, who has said far more inflammatory and anti-Semitic things in the last three years

than anything Macklemore said, which I don't think if you read what he said, any of it could even vaguely be considered hate speech.

MACFARLANE: That's an interesting point. And as we're pointing out there, I think people wanting -- are wanting now to put the onus back on Kraft

himself and his intervention here. But the question I have for you is, who has more influence and power here in this moment? Is it Robert Kraft or is

it Ed Sheeran? I mean, what could Sheeran have done differently?

ASWAD: The mistake Sharon made was in not seeing this coming and giving a sort of half in, half out response to it. If he had just owned up and said,

I agree with what Macklemore is saying because he would not have let Macklemore open for him for a second night if he didn't at least co-sign it

in some way.

He didn't see it coming, he didn't have a strong response prepared. I mean, even his music is uncontroversial, you know? So, he's trying very hard to

walk the middle line and that has worked out very well for him, he is or was one of the most popular artists in the world.

And his neutrality is almost demonstrated by the fact that on one hand, he's friends with Macklemore and on the other hand, he's very good friends

with Robert Kraft. He even performed at a wedding in 2022.

MACFARLANE: And look, I just wanted to -- just to quickly ask you, Jem, I mean, he's stressed, as you said, that he wants to remain apolitical, he

wants to remain neutral, but I think that's in collision with how fans want their celebrities and the people they follow to be. You know, there seems

to be this increasing need for celebrities and singers to be transparent about their views.

Do you think it's possible to remain apolitical in an environment today on an issue like this?

ASWAD: Well, this is something Taylor Swift has struggled with very publicly for 10 years now and she finally came down on the side of

Democrats, liberals, basically on that side. She was trying to be neutral for a very long-time and she couldn't really do that anymore.

Maybe Ed Sheeran is in that position as well. He's tried very hard to remain neutral on every single issue and right now it is completely blowing

up in his face and both he and Kraft are the ones who are looking like the losers in this.

MACFARLANE: All right. Jem, I'm afraid we'll have to leave it there, but obviously, it's a really interesting issue, and we'll continue to talk

about it. Thank you so much.

And do stay with us. We'll have more after this quick break.

(COMMERCIAL BREAK)

[15:55:42]

MACFARLANE: And finally, a novel idea in Singapore aims to turn the page on Brain Rot. The country has launched a national campaign that pays people

to read. By gamifying the habit, Singapore hopes to encourage citizens to pick up a book. Organizers say reading strengthens attention, critical

thinking and imagination and keeps people from mindlessly scrolling on their phones. What a great idea.

That is it for the team and me. I'm Christina Macfarlane. This is WHAT WE KNOW.

Stay tuned. Richard is up after the break.

END

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