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Exodus to Egypt; Heath Ledger Autopsy Inconclusive; Asian Markets Back in Black, European Shares Sink

Aired January 23, 2008 - 12:00   ET

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

ROSEMARY CHURCH, CNN INTERNATIONAL ANCHOR: Exodus to Egypt. Thousands of Palestinians pour out of Gaza after militants blast through a border barrier.
JIM CLANCY, CNN INTERNATIONAL ANCHOR: Markets in flux. Europe reels, Asia rebounds, and Wall Street just isn't convinced the surprise interest rate cut will work.

CHURCH: Death of a movie star. Doctors perform an autopsy on Heath Ledger but say it could be weeks before they know why he died.

CLANCY: There are political dreams, and then there is political dreaming. No tired cliches here. The pictures tell the story.

It is 7:00 p.m. right now in Rafah, along the border between Egypt in Gaza. It is noon on Wall Street.

Hello and welcome to our report seen around the globe.

I'm Jim Clancy.

CHURCH: And I'm Rosemary Church.

From New York to Cairo to Sydney, wherever you are watching, this is YOUR WORLD TODAY.

CLANCY: We're going to begin our report this hour with an incredible scene in Gaza. By the thousands, Palestinians are streaming across the border into Egypt. Their mission, at least for most, buy food, fuel and medicine that's grown scarce since Israel imposed a blockade last week to stop repeated militant rocket attacks. Now, earlier, militants blasted open the border wall there that divides the town of Rafah.

We have reporters on both sides of the border, but we're going to begin this hour with Aneesh Raman. He's on the Egyptian side of the border. And we're going to talk with him about the scene that he is watching -- Aneesh.

ANEESH RAMAN, CNN MIDDLE EAST CORRESPONDENT: Jim, we've spent pretty much this entire day driving our way to Rafah. We are about 20 minutes outside of that border crossing.

We've just passed through what is normally the sleepy sister town to Rafah, El-Arish, that is wide awake tonight. We passed a number of groups of Palestinians, each group had about 20 on the roadside. We've seen trucks going both directions, both to Rafah and away. We've seen Palestinians purchasing goods.

As one resident Egyptian said, El-Arish has become a new Gaza City. Smaller in population, but, nonetheless, at the moment really overrun by Palestinians so desperate for supplies that they poured their way into Egypt in the tens of thousands today, trying to survive, make their lives better.

Now, the Egyptian government is saying at the moment about 50,000, they think, Palestinians from Gaza have come in. But the problem is that border area was essentially completely open. There is no way to know how many came in, how many went back.

There are other estimates putting the number much higher. And tonight, Jim, for the Egyptian government, the question is, what comes next?

We've heard from the foreign ministry they will keep this border open until the humanitarian crisis in Gaza ends. That could be sometime.

Meantime, Egypt has its own diplomatic agreements with Israel, who is very concerned about any weapons that could go into Gaza during this, at some level, chaotic moment. Now, the Egyptian military is increasing its presence. Some more order is coming. But again, that key question for Egypt tonight is, what comes next?

Jim.

CLANCY: Well, if there is this free flow, as you describe it, there certainly are those Israeli concerns. What guarantees, if any, are the Egyptians giving to in one way or the other try to ensure that cash and arms and explosives aren't sent in there? This all appears to be premeditated, the way this wall was taken down with explosives.

RAMAN: Exactly. And the Egyptians have sort of been caught off guard.

At one level, we've seen reinforcements in terms of Egyptian security forces throughout the day, driving the same path they were going, dozens of them, big security vehicles. Clearly, the Egyptian government is trying to beef up its presence there.

At the same time, as you mentioned, while the wall itself might have had some planning before it was taken down, the Egyptian government said, look, that wall isn't on Egyptian soil, that's Palestinian soil, it's an Israeli-built wall. That's not our issue.

But for the Egyptians, at first the president said our troops will stand aside and allow the Palestinians who are starving to get food. But as you said, it gets complicated, because they haven't provided too many specifics about what is happening in checking these people.

As far as we heard reports when this all started taking place, it was, perhaps, best described as chaos, people just going back and forth. There was very limited control that the Egyptian authorities could have. These are traditionally very quiet areas, Rafah and the town we just passed through, El-Arish, that are now very populated with Palestinians, some of whom are going to be wondering, can they stay, do they have to go back?

A lot of questions tonight, but a huge amount of relief you should see on the faces of the Palestinians, who have been essentially suffocating, to a large degree, in Gaza from resources. Now able to at least purchase things.

And from what we can tell, cars are going both ways. We haven't gotten to Rafah yet, but perhaps people are bringing supplies in and coming back to get more -- Jim.

CLANCY: All right.

Aneesh Raman there giving us a live update. He's just outside El-Arish. We'll hear more from him in -- as there are developments in this story -- Rosemary.

CHURCH: All right.

So we heard from Aneesh what's happening on the Egyptian side of the border. Let's go to the other side of that border, to Gaza. Our Ben Wedeman is there.

Ben, what are you seeing there?

BEN WEDEMAN, CNN INTERNATIONAL CORRESPONDENT: Well, what we saw is basically the mirror image of what Aneesh is reporting. We saw throughout the day tens of thousands of people pouring accost the border, and, really, they came from all parts of the Gaza Strip.

We're in Gaza City now, which is sort of a ghost town. Most people have gone to Rafah. It's a carnival atmosphere.

This is a unique opportunity for people who have been cooped up in this very crowded patch of land to finally get out. And everyone is taking advantage of it -- Rosemary.

CHURCH: And is there a sense that a lot of these people, once they've got their supplies, will come back, or are they going to wait it out on the other side of the border?

WEDEMAN: No. Really people are fairly sure that this open border is going to close again. So they're going in quickly, getting whatever they can, and coming back. There is very little expectation that a large number of Palestinians are actually going to stay in Egypt.

There are those who desperately need to get out for medical treatment. I spoke to people who were taking their children to the airport in Cairo in the hopes that they could send them to various universities they were enrolled in but weren't able to get to because of the closed borders. But by and large, the expectation is that most people are just going out to buy what they need, and then going back home. Most of them just don't have the money to get by in Egypt -- Rosemary.

CHURCH: All right. Our Ben Wedeman reporting there from Gaza.

Thanks so much.

(NEWSBREAK)

CHURCH: Well, investigators in New York need at least 10 more days to find out what caused the death of film star Heath Ledger. An initial autopsy was inconclusive, and a medical examiner says more toxicology tests are needed. The body of the Australian actor was found in his Manhattan apartment on Tuesday.

Jason Carroll reports.

(BEGIN VIDEOTAPE)

JASON CARROLL, CNN CORRESPONDENT (voice-over): A tragic end of a promising acting career captured by a crowd of paparazzi. Outside a New York City apartment building, Heath Ledger's fans gathered outside as well, some still in shock over the loss.

UNIDENTIFIED FEMALE: I'm a mess. I've been crying all day. I just -- I can't believe something would happen to someone so talented and...

UNIDENTIFIED MALE: He's a great actor. I mean, he had the potential to be a fantastic actor. So to do so many things, it's just sad to see how it ended, you know?

CARROLL: It's not clear yet just what caused Ledger's death. A fire department spokesperson says Ledger died of a possible drug overdose, but police would not speculate on the cause, only to say there was no indication of suicide. 28-year-old actor's body was found by a housekeeper and a massage therapist around 2:45 yesterday afternoon.

DEPUTY COMMISSIONER PAUL BROWNE, NEW YORK POLICE: He was found facedown on the floor at the foot of the bed.

UNIDENTIFIED MALE: Face down.

UNIDENTIFIED FEMALE: And he was naked, sir?

BROWNE: He had no clothes, correct.

CARROLL: The housekeeper and therapist tried to revive Ledger but could not. Paramedics arrived at the fourth floor Soho apartment around 3:30 and pronounced him dead. Police say they found several bottles of prescription medicine in the apartment, including sleeping pills found near the actor's bed.

(BEGIN VIDEO CLIP, "BROKEBACK MOUNTAIN")

JAKE GYLLENHAAL, ACTOR: You gonna do this again next summer?

HEATH LEDGER, ACTOR: Well, maybe not.

(END VIDEO CLIP, "BROKEBACK MOUNTAIN")

CARROLL: Ledger is perhaps best known for his Oscar-nominated role in "Brokeback Mountain." And while his career was a success, privately the actor struggled. Recently, Ledger had broken up with actress Michelle Williams whom he met while filming "Brokeback." The two have a baby girl. In the actor's hometown of Perth, Australia, the star's family tried to make sense of the loss.

KIM LEDGER, HEATH LEDGER'S FATHER: He was a down-to-earth, generous, kind-hearted, life-loving, unselfish individual who was extremely inspirational to many.

CARROLL (on camera): The flowers and cards and candles keep coming from Ledger's fans here at his apartment building in Soho. An autopsy was completed this morning. The initial test results were inconclusive. The medical examiner says it could take up to two weeks before additional testing is complete and an exact cause of death is determined.

Jason Carroll, CNN, New York.

(END VIDEOTAPE)

CLANCY: Well, coming up, Wall Street can't shake that sinking feeling.

CHURCH: No. Concerns about the economy continue to haunt investors. We'll get a live update on the Dow and check in on markets all around the world.

CLANCY: Also ahead, from the soccer pitch to Sierra Leone, David Beckham doing good deeds in a country scarred by civil war.

CHURCH: And later, she hasn't yet chosen a running mate, but critics say, oh, yes she has. Bill Clinton teams up with wife, Hillary, to take on Barack Obama.

(COMMERCIAL BREAK)

CLANCY: Hello, everyone, and welcome back. You're with CNN International and YOUR WORLD TODAY. A special welcome to our viewers in the United States this hour.

We continue to cover what is obviously the biggest story of the week. The major story of 2007, some would say. It's the wild market swings not just in the U.S., but around the world. Investors not able to shake deep concerns about the U.S. economy and what it means for them.

(BUSINESS REPORT)

CHURCH: Well, Asian markets actually bounced back from several days of steep losses. But it was quite a different story for stocks in Europe.

For more on that, let's bring in Jim Boulden in London.

And Jim, of course by the end of trade yesterday it was looking pretty good. There was a bit of recovery there. Something happened. What was it? A different story today.

JIM BOULDEN, CNN INTERNATIONAL CORRESPONDENT: Well, Rosemary, what the concern basically is about, what people here in the city of London are telling me, is that the bank shares now have sunk again today. So they're down some 40 to 50 percent since their highs in 2007, and that means banks will have less money to loan.

They'll have less money to loan to us, to people with mortgages, have less money to big companies. And that means that that could actually trigger the recession that everyone is worried about.

Let me show you the ugly numbers from Europe today.

We had the FTSE 100 down another 2.28 percent, wiping out most of yesterday's gains. The CAC was down 4 percent in Paris. And the DAX in Frankfurt, again, the big loser, down nearly 5 percent.

On the year, we're talking about bear markets. Well, I'll tell you, the DAX is down nearly 20 percent, and we are only into the third full week of trading in 2008, with the FTSE 100 here in London down about 13.5 percent for the year, and the CAC down some 17 percent for the year.

And Rosemary, let me give you a good example. Not only were the banks down, but big oil shares were down. Some of the oil shares were down between 4 percent and 5 percent. And the reason for that is they think maybe people will use less oil if it goes into recession. So we're seeing big oil falling.

Another one -- I'll leave you with this one -- truck makers. There's three big truck makers here in Europe. Their shares were down between 3 percent and 7 percent.

The thought is, if you're not building big buildings, if you're not doing a lot of investing, if you're not doing a lot of movement, you need less trucks. And that's probably a very good example of the pessimistic mood with European investors today -- Rosemary.

CHURCH: Oh, dear.

All right. Jim Boulden reporting there from London.

Thanks for that.

CLANCY: You know, it has to be depressing. I know as we watch all of this bad news, we are always looking for something to lift our spirits a little bit. We want to throw in this little story. It's about a cat that was curious and probably a lot more curious than most. CHURCH: Could be. One woman in the U.S. says she's grateful to a good Samaritan who took care of her 10-month-old Tabby (ph) after it took a plane ride to Dallas. She discovered Gracie Mae (ph) was missing after she took her husband to the airport.

CLANCY: Now, later, a man called saying that he accidentally picked up her husband's suitcase at the Dallas-Ft. Worth airport, and when he opened the black suitcase he literally let the cat out of the bag.

CHURCH: And you'll be happy to know the adventurous pet is now back home. I'm sure he was a little surprised.

CLANCY: Yes. They didn't exactly put the cat in an animal carrier, did they?

CHURCH: No. That was confusing.

CLANCY: Pet carrier.

CHURCH: Yes.

CLANCY: Well, saved the money but lost the cat.

CHURCH: All right. Well, is Pakistan's army losing ground in the war on terror?

CLANCY: Still to come right here on YOUR WORLD TODAY, Pakistan may be turning to the United States for military help in the battle against the Taliban.

CHURCH: Also, politics may bore some of you, but it really shouldn't do that to some who are in a career for it.

Caught napping on the world stage, still ahead on CNN.

(NEWSBREAK)

(COMMERCIAL BREAK)

CHURCH: Welcome back to our viewers joining us form all around the globe, including the United States.

This is YOUR WORLD TODAY.

I'm Rosemary Church.

CLANCY: I'm Jim Clancy. And these are some of the stories that are making headlines around the globe.

By the thousands, Gaza residents poured into Egypt to buy food, fuel and medicine. Militants blew up and bulldozed some of the border wall. Despite Israel's security concerns, Egypt says it will keep that border open for now.

CHURCH: Initial autopsy results on the body of Australian actor Heath Ledger were inconclusive. The New York Medical Examiner's Office says more tests are needed, and it could take 10 days to pinpoint what exactly caused Ledger's death. A housekeeper discovered his body on Tuesday.

CLANCY: Stocks on Wall Street extending their slide. The Dow plunging at the start of trading today, losing more than 250 points in the first few minutes. It's recovered some of that; however, you can see it right there on the Big Board, still down more than 160 points.

ROSEMARY CHURCH, CNN ANCHOR: Well, for Asian markets though, today brought relief from days of steep declines. We've got reports from across the region. Let's start with Eunice Yoon in Hong Kong.

(BEGIN VIDEOTAPE)

EUNICE YOON, CNN CORRESPONDENT: I'm Eunice Yoon standing along the beautiful harbor here in Hong Kong.

The markets here staged a rebound as investors took heart in the U.S. Federal Reserve's steepest interest rate cut in 23 years. The benchmark index rallied by nearly 11 percent after policymakers here decided to follow the Fed's lead and cut interest rates by .75 percent.

That move sparked a bout of buying in this market. Investors were looking to pick up bargains, looking at interest rate-sensitive stocks such as property plays and the barks. Lower interest rates usually encourage people to borrow more money from the banks to buy new homes.

Still, there are lingering concerns of a recession. People here are worried that those interest rate cuts in the United States might not be enough to stave off a recession in the world's largest economy.

(END VIDEOTAPE)

(BEGIN VIDEOTAPE)

KYUNG LAH, CNN CORRESPONDENT: On this gloomy, wet day in Tokyo, there is some brighter news out of the Nikkei. I'm Kyung Lah in downtown Tokyo, where the markets have closed in the positive category, up 267 points after an early-morning rally, but a sell-off in the afternoon. The close, though, certainly an improvement from yesterday.

This is all in reaction to the U.S. Federal interest rate cut from yesterday. There is deep concern here on the streets of Tokyo that this is a band-aid and that the real issues have not been addressed, that of the U.S. subprime crisis, that the U.S. economy is heading into recession, and a lack of consumer confidence.

This man says he lost so much money that it's affecting how much his entire family can spend. Consumers an investors are feeling jittery. They are feeling nervous. And even though today it was a better day, there is some concern over what the next trading day will hold. Kyung Lah, CNN, Tokyo.

(END VIDEOTAPE)

(BEGIN VIDEOTAPE)

SARA SIDNER, CNN CORRESPONDENT: Here in India it's been high drama from a market that tanked yesterday to 180-degree change. One of the markets, the Sentex (ph), saw its biggest gain every by midday. Now Monday and Tuesday were truly painful, especially for that small retail investor. Even devastating for some. But today, the deep pocket big investors were standing on the sidelines, money in hand, ready to buy and that sent the markets soaring upwards.

Still, in a population that traditionally traded and looked towards gold and property for good investments, there is still some concern. However, on the streets, people are talking basically about the fact that in the United States the Fed cut interest rates and that certainly helped the markets here today, though it has been very volatile throughout the day.

Sara Sidner, CNN, New Delhi.

(END VIDEOTAPE)

CLANCY: Well, China's stock markets have gained quite a bit of prominence over the course of the last couple of years. Over the last couple of years, they've also been mainly up. But the past few days show that they are not immune to fears of a U.S. recession. As John Vause tells us, many Chinese traders learning some pretty hard lessons.

(BEGIN VIDEOTAPE)

JOHN VAUSE, CNN CORRESPONDENT, (voice over): An almost three- year long surge in China's share prices now practically at a grinding halt. Unlike previous big falls, there's been no dramatic rebound this time. The market ended the day up just over 3 percent.

MICHAEL PETTIS, CHINA FINANCIAL EXPERT: Ultimately, China is going to have to make an adjustment. And the rest of the world is making that adjustment or seems to be in the process.

VAUSE: Many small investors are accustomed to a market more like a never-ending cash machine. Well, they're struggling to understand why this fall seems different.

"I don't know what happened," this man told me, "but on TV they're talking about the bad state of the U.S. economy."

And what happens next here might just be decided by people like Xu Leiguang. In two years he made on paper more than $100,000 U.S. dollars. $20,000 was wiped out in two days.

XU LEIGUANG, INVESTOR, (through translator): I only invest the money I've already made. I'm not afraid to lose because I have faith in my stocks.

VAUSE: Meng Bai is also down more than $40,000 U.S. dollars. Even so, she's leaving her money in the market.

MENG BAI, INVESTOR, (through translator): I'm not worried about the Chinese economy. I think that it may slow a little but it will be steady for a long time.

VAUSE: But there are problems here. Beijing has been warning for almost a year that the market is overvalued, inflation is high, the housing market is beginning to slow, all of this coming together when the U.S., China's number one export customer, is facing recession.

During China's bull run, there was a theory here that somehow this market operated in a parallel universe, immune to the ups and downs of the rest of the world. But not now, it seems. The panic selling of the last few days was brought on, at least in part, by fears of a slowdown in the U.S. economy.

John Vause, CNN, Beijing.

(END VIDEOTAPE)

CLANCY: Now for the very latest financial news, plus analysis, you can always turn to our website. It's all waiting for you at cnnmoney.com.

CHURCH: Well, the timing of the World Economic Forum in Switzerland couldn't have come at a better time. The financial world is busy dealing with this global market turmoil. U.S. Secretary of State Condoleezza Rice is delivering the keynote address at the five- day meeting in the Alpine resort town of Davos. And that's where our Hala Gorani joins us now.

Hala.

HALA GORANI, CNN CORRESPONDENT: You know, the forum started, Rosemary, with markets tumbling. This is the World Economic Forum. And talk of a recession and a market meltdown really hijacked discussions at this forum. And now the U.S. secretary of state, Condoleezza Rice, is due in a few minutes to deliver the keynote address just as there is turmoil on the Gaza/Egypt border with 50,000- plus Gaza residents rushing the border into Egypt to stock up on basic supplies.

We're going to bring you a portion of the U.S. secretary of state's statement. She won't be taking any questions. But what she has to say, she's expected to make comments on the Middle East situation.

And this is a very important time for Condoleezza Rice, of course. She is fresh off of a Mideast tour where she accompanied the U.S. president to six countries, made an unannounced stop to Iraq as well. The Bush administration very eager to show that they're involved in the Middle East peace process. And going and greeting and shaking hands with their very firm and fervent allies in the Gulf countries, such as Bahrain, Saudi Arabia, as well as Egypt. That was the last country on their stop last week.

So we are expecting Condoleezza Rice to make a statement. When she does address the issue of the Middle East, we will bring that to you as well.

But what's been going on? As I mentioned at the top here, Rosemary, at the World Economic Forum, is discussions regarding the economy and the world economy. We'll get to that in a minute. But, first, let's take you live to Davos where Condoleezza Rice is making a statement. Listen.

CONDOLEEZZA RICE, U.S. SECRETARY OF STATE: To say that it is a very good thing if no one misses any notes, the piano or the orchestra. I want to applaud you for everything that you've done to put this World Economic Forum together and to make it a place where people come to share ideas and ideas that can indeed lead to a better world. It is the wonderful gathering of civil society, of business, of great leaders from around the world. And also I note that you've also gone out of your way to include young people, and I thank you very much for your efforts.

Let me thank also the President Kisba (ph) for the work that the government and the people of Switzerland have done in generously welcoming us to this beautiful country. President Karzai, Dr. Pitrari (ph), thank you very much for your wonderful work and I'm really just delighted to share the dias with you tonight.

Distinguished guests, ladies and gentlemen, it is an honor to join you here. And as Talsa (ph) said, I have tried to get here several times before. I was determined to make it as secretary of state and I guess I can say better late than never (INAUDIBLE). I spoke at the forum by video in 2006 and I had the pleasure last year of receiving a group of young global leaders at a first-ever U.S. policy summit. And so I understand that some of them are here today. It's a wonderful legacy that you're leaving, Sasin (ph), in bringing these young people in.

I was thinking about what I was going to say tonight and I've been watching the news and I've been looking at the images on television and I've reflected on the events of the day. And, of course, what comes front and center for all of us is the turbulence, political and economic, in our world. The violence in Kenya. The tragic assassination of Mrs. Benazir Bhutto in Pakistan. The ongoing and at times halting efforts of Iraqis and Afghans to build peaceful, functioning government. The looming danger of climate change. The forecasts of market woes and economic troubles. Even a growing concern about globalization itself, a sense that increasingly it is something that is happening to us, not controlled by us.

And as I took a look at all of this, I decided to do something risky. I want to talk about the importance of ideals and I want to talk about the need for optimism in their power.

Now I know that whenever Americans start talking about idealism and optimism, international audiences groan. Perhaps there's a little concern that you're going to hear a long, moralizing lecture. Well, I promise not to do that. And another common concern when Americans talk of idealism and optimism is, well, there they go again. The innocence abroad.

Indeed there is a long, international tradition of viewing America as kind of young and naive. Well, in our defense, I would say naive. Well, in our defense, I would say, we're not that young. And if you're tempted to think that we are naive, then you should hope that Bismarck was right when he said, "God has a special providence for fools, drunks and the United States of America."

Seriously though, I recognize that there is a climate of anxiety in our world today. And it is tempting for many people to turn inward, to secure what they have, and to shut others out. Some want to go it alone and there is certainly cynicism about the salience of our ideals when it seems that it's just hard enough to protect our interests.

I know that many are worried by the recent fluctuations in U.S. financial markets and by concerns about the U.S. economy. President Bush has announced an outline of a meaningful, fiscal growth package that will boost consumer spending and support business investment this year. My colleague, Hank Paulson, who had hoped to be with you, is leading our administration's efforts and working closely with the leaders of both parties in Congress to agree on a stimulus package that's swift, robust, broad-based, and temporary.

The U.S. economy is resilient. Its structure is sound. And its long-term economic fundamentals are healthy. The United States continues to welcome foreign investment and free trade. And the economy -- our economy -- will remain a leading engine of global economic growth. So we should have confidence in the underlying strength of the global economy and act with confidence on the basis of principles that lead to success in this world.

And on that note, I would submit to you this evening that there is not one challenge in the world today that will get better if we approach it without confidence in the appeal and effectiveness of our ideals. Political and economic freedom, open markets and free trade, human dignity and human rights, equal opportunity and the rule of law. Without these principles, backed by all forms of national power, we may be able to manage global problems for a while, but we will not lay a foundation to solve them.

This is the core of America's approach to the world. We do not accept a firm distinction between our national interests and our universal ideals. And we seek to marry our power and principles together to achieve great and enduring progress.

This American approach to the world did not begin with President Bush. Indeed, it is as old as America itself. I have referred to this tradition as American realism.

It was American realism that enabled the united states to come into being in the first place. It was American realism that led us to rally our allies to build a balance of power that favored freedom in the last century. And in this century, it is this American realism that shapes our global leadership in three critical areas that I'd like to talk about tonight. The promotion of a just, economic model of development. The promotion of a freer, more democratic world. And the role of diplomacy in overcoming differences between nations.

First, let us take development. And amidst the extraordinary opportunities of the global economy, which we will talk about here, the amount of deprivation in our world still remains unacceptable.

GORANI: All right. We're going to break away there from the statement by U.S. Secretary of State Condoleezza Rice, live at the World Economic Forum in Davos. She said she wanted to talk about idealism and optimism and she acknowledged that when U.S. officials utter these two words, that often they're met with groans by the international community. She said, and wanted to reassure the world about U.S. financial markets after the turmoil that we experienced over the last 48 hours, saying that the U.S. economy remains solid. And also wanted to say that she does not accept the distinction between American interests and universal ideals, calling the American approach to foreign policy "American realism."

So, Rosemary, you see it there, the U.S. secretary of state. It's her first appearance in person at the World Economic Forum and probably her last as U.S. secretary of state. And so she is really sending this message out to the world and the philosophy of her foreign policy as she has been at the head of the State Department in the last few years.

Rosemary.

CHURCH: And, Hala, what's the likely response to what she's saying there on this day? No surprises really, are there?

GORANI: No, no surprises. That said, I think within the context of this forum, Rosemary, what you're seeing is a lot of criticism of the Federal Reserve, of the U.S. economy being the largest in the world. Many top, top economists saying that the response to the current crisis shouldn't be cutting interest rates by 75 basis points. Essentially, that this is fueling the kind of bubble that got America and that will infect the rest of the world into the position it is in the first place.

As far as the American realism and foreign policy, it is the third year into this second term of George Bush. In places like the Middle East, there is a lot of skepticism regarding America's intentions. It's doubtful that statements such as these will convince people otherwise.

Rosemary.

CHURCH: Indeed. Our Hala Gorani covering the World Economic Forum in Davos there. Thanks so much.

And we're going to take a very short break now. We'll have more for you after this. Stay with us. (COMMERCIAL BREAK)

CLANCY: Finally going after Osama bin Laden. Well the Pentagon reportedly considering a plan that would send hundreds of U.S. troops into Pakistan. Barbara Starr has more and it's a controversial plan.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN CORRESPONDENT, (voice over): CNN has learned U.S. military commanders are reviewing a classified planning order which could result in hundreds of U.S. troops going to Pakistan to train security forces, but only if the Pakistanis buy the idea. President Pervez Musharraf has said his troops will be the ones to fight the Taliban and al Qaeda. But last week, Taliban fighters overran a Pakistani fort. There's worry Pakistani forces are failing against the growing extremist threat.

ADM. MICHAEL MULLEN, CHAIRMAN, U.S. JOINT CHIEFS OF STAFF: That continues to be a grave concern to us, both in the near term and the long-term.

STARR: For the U.S., the job now is to get an agreement to train Pakistani forces in counter insurgency warfare.

FREDERICK BARTON, CSIS: The presence of U.S. forces in Pakistan would be hugely inflammatory for the rest of the country and probably would destabilize Pakistan in a more serious way than it is right now. So, clearly, training is the best thing we can do.

STARR: Why now? The assassination of former Prime Minister Benazir Bhutto has destabilized the country. Al Qaeda now operates in many major cities.

ROBERT GATES, U.S. SECRETARY OF DEFENSE: I think that the Pakistani government, frankly, is dealing with the emergence of a threat inside Pakistan that it has not confronted until very recently. And it's not a surprise to me that they're having some challenges in trying to deal with that.

STARR: The planning order, should Pakistan give the OK, is part of a five-year, $750 million security and economic effort. Still, the Pentagon is treading lightly before sending U.S. troops to a place they're not likely to be widely welcomed.

GEN. JAMES CARTWRIGHT, VICE CHAIRMAN, U.S. JOINT CHIEFS: We're trying to make sure we understand ground truth before we take any action.

(END VIDEOTAPE)

STARR: Jim, Rosemary, it's all about sending trainers. The Pentagon has no intention of sending combat forces.

Jim. Rosemary.

CLANCY: All right, Barbara Starr there at the Pentagon, thank you.

CHURCH: Well, politicians love to be in the spotlight.

CLANCY: Not always, Rosemary. At least when the spotlight shines on a scene like this. More on the story when we come back.

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CHURCH: Well, with U.S. politics now and all of the speeches, handshakes and political squabbling, the campaign trail can, of course, be really exhausting.

CLANCY: And now, of course, Bill Clinton being criticized mightily after he nodded off a little bit earlier this week. But as Jeanne Moos discovered, Bill Clinton isn't the only politician found to have -- can we call them power naps.

CHURCH: I guess.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN CORRESPONDENT, (voice over): Bill Clinton seen here awake. Bill Clinton seen here falling asleep. Elbow falling off the arm rest falling asleep.

UNIDENTIFIED MALE: To live up to their purpose and potential.

MOOS: Oh, sure, he then cupped his ears if trying to hear. But at this Martin Luther King Day celebration, he earned the headline "Bill has a dream" from the "New York Post" which showcased the video.

UNIDENTIFIED MALE: I believe that the time, as Victor Hugo (ph) said, it is always right to do that which is right.

MOOS: Maybe what's not right is showing this video. We all nod off. But when you're the president, and, say, the pope is speaking a few feet away . . .

UNIDENTIFIED MALE: Foreign suspicion (ph) have found the Jesus (ph) of the world.

MOOS: Take some No-doze. For some reason it's adorable when a dog naps. But we don't cut our sleepy politicians any slack, be it a distinguished older senator, or a former president exhausted from campaigning for his wife.

Wake up! No napping during this segment.

And especially not during a cabinet meeting when Vice President Dick Cheney got nabbed apparently nodding off.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Work in a collaborative fashion with the federal government.

MOOS: Practicing meditation was how a Cheney spokesperson laughed it off. YouTubers show no mercy, adding musical commentary to video of a droopy-lided Senator Conrad Burns. Or adding snoring to video of the Clintons at Ronald Reagan's funeral. But beware, during a State of the Union Address, a bunch of politicians seemed to be snoozing. Turns out they were following the text of the president's speech in their laps.

A book call "The After the Napping" lists Bill Clinton as a legendary napper. Clinton has talked about chronic sleep deprivation among members of Congress who commute.

BILL CLINTON, FORMER U.S. PRESIDENT: Well, I do believe sleep deprivation has a lot to do with some of the edginess in Washington today.

MOOS: There was edginess over this video.

UNIDENTIFIED MALE: Vanity asks the question.

MOOS: Between supporters, "Bill Clinton is a 61 year old guy who has had a heart attack and is working his butt off with little sleep." And critics, "the hand cupping the ear to hear better, the phony nods of agreement. He lies even when he's sleeping."

On that note, let's let sleeping dogs lie.

Jeanne Moos, CNN, New York.

(END VIDEOTAPE)

CHURCH: Ouch.

CLANCY: But it was good. The speeches, not quite as good. I had a little sympathy for them.

That's it for this hour. I'm Jim Clancy.

CHURCH: And I'm Rosemary Church. And this is CNN.

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