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Trump Admin Plans Unprecedented Military Crime Crackdown In Chicago; Trump Sends Letter Of Support To Zelenskyy For Ukraine's Independence Day; U.N.-Backed Group Declares "Man-Made" Famine In Parts Of Gaza; New Orleans And Gulf Coast Residents Reflect On Hurricane Katrina; ICE Raids In Home Depot Parking Lots Put Day Laborers In Limbo; Despite More Homes For Sale, Buyers Aren't Biting Anymore. Aired 1-2p ET

Aired August 24, 2025 - 13:00   ET

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

(COMMERCIAL BREAK)

[13:00:40]

ISABEL ROSALES, CNN HOST: Hello, and thank you for joining me. I'm Isabel Rosales in for Fredricka Whitfield. President Trump is ramping up his feuds with Democratic-run cities and states over crime and threats of military deployments.

Just moments ago, Trump suggested he may pull federal funding for the reconstruction of the collapsed Francis Scott Key Bridge in Baltimore. In a series of Truth Social posts, the President attacked Maryland Governor Wes Moore's record on crime, and tied bridge funding to a political dispute on deploying the National Guard to cities across the country. It comes as CNN has learned the Trump administration has been planning for weeks to send National Guard troops to Chicago, America's third-largest city.

It's believed the deployment would look different from what we've seen in Washington, D.C., where the President has more leeway in directing troops. The Chicago deployment could more resemble what the President did in Los Angeles in response to immigration protests there this summer. But this time, troops are expected to have a broader focus of combating crime, an unprecedented use of the National Guard.

CNN's Julia Benbrook joins us now. Julia, what more can you tell us about this possible deployment?

JULIA BENBROOK, CNN CORRESPONDENT: Well, Democratic leaders in cities as well as governors have been really pushing back against President Donald Trump's efforts, attempts to expand these efforts, and this really started here in Washington, D.C. In recent weeks, we saw the President take control, temporary control, of the D.C. Metropolitan Police. And you also see this regular, visible presence of the National Guard.

And he does have more authority in the district to make these changes than he does in the states, but he is promising to try and expand these efforts. In fact, while speaking in the Oval Office on Friday, he previewed what next steps might look like, saying that he is looking at Chicago now.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Chicago is a mess. You have an incompetent mayor, grossly incompetent, and we'll straighten that one out probably next. And the people in Chicago, Mr. Vice President, are screaming for us to come. They're wearing red hats, just like this one, but they're wearing red hats.

(END VIDEO CLIP)

BENBROOK: Officials who spoke with CNN say that there have been plans to send troops there for weeks, but there's still a lot that is unclear, like when that might happen and how many troops may be sent. Chicago Mayor Brandon Johnson said that there has not been direct communication on this with his office or with the governor's, and he has accused Trump of, quote, stoking fears. He also says that taking these actions will not help bring down crime in his city.

(BEGIN VIDEO CLIP)

MAYOR BRANDON JOHNSON (D), CHICAGO: What he is proposing at this point would be the most flagrant violation of our Constitution in the 21st century. The city of Chicago does not need a military occupation. That's not what we need. In fact, we've been very clear about what we need. We need to invest in people to ensure that we can build safe and affordable communities.

(END VIDEO CLIP)

BENBROOK: In a statement, Illinois Mayor J.B. Pritzker said this. He said, quote, the safety of the people of Illinois is always my top priority. There is no emergency that warrants the President of the United States federalizing the Illinois National Guard, deploying the National Guard from other states or sending active-duty military within our own borders. While it is not uncommon for federal authorities like the National Guard to assist in emergency situations across the country like natural disasters or civil unrest, experts say that sending in the National Guard in a blanket order to address crime and implement the President's immigration policies is unprecedented.

So while this started here in D.C., Trump says Chicago is next. Then he's looking at New York. He's also mentioned several other cities in recent weeks that he says are, quote, very bad, including Los Angeles. Isabel?

ROSALES: Julia Benbrook, thank you.

New video into CNN shows Ukrainian prisoners of war, arriving home. They are part of the largest prisoner exchange with Russia. The return of soldiers comes on Ukraine's Independence Day. CNN's Nada Bashir has more.

[13:05:03]

NADA BASHIR, CNN REPORTER: While marking Ukraine's 34th Independence Day, U.S. President Donald Trump has sent a letter of support, praising the nation's courage and saying the United States believes in its future as an independent state. The letter was shared on X by Ukraine's President Volodymyr Zelenskyy, who thanked Trump for his message, with Keith Kellogg, the Trump administration's Russia-Ukraine envoy, in attendance for Kyiv's Independence Day ceremony on Sunday.

Zelenskyy, meanwhile, also delivered his own address to Ukraine, reiterating his determination to triumph against Russia. In recent weeks, Ukraine has ramped up its attacks on Russia, particularly when it comes to Russia's energy infrastructure. According to a CNN tally of attacks, Ukrainian drones have struck at least 10 key Russian energy facilities this month alone.

And while reports have emerged that the Pentagon has, for months, been blocking Ukraine's use of U.S.-made long-range army tactical missile systems to strike inside Russia, President Zelenskyy said Sunday that he has not yet discussed the use of such weapons with the U.S., and that Ukraine is currently using domestically produced long-range weapons.

Efforts to secure a diplomatic resolution to the conflict, meanwhile, appear to have stalled once again, with the Kremlin pouring cold water on the possibility of a meeting between President Putin and President Zelenskyy in the near future. However, speaking to NBC, U.S. Vice President J.D. Vance indicated some degree of optimism, saying that Russia has made significant concessions and that the U.S. will keep on pushing for a diplomatic solution.

Nada Bashir, CNN, in London.

ROSALES: New this hour, Israel striking Iran-backed Houthi rebels in Yemen today. This video shows black smoke rising in parts of the capital, Sanaa. Sanaa, the Israeli military says strikes targeted a military site where the presidential palace is located, as well as power plants and a fuel storage depot. It says it launched the attack after the rebels fired a new kind of missile toward Israel on Friday.

Also new today, Israeli forces slamming the outskirts of Gaza City with airstrikes and shelling. Sixty-four Palestinians have been killed and hundreds injured in the past 24 hours. That's according to Gaza health officials. Earlier today, Israel's defense minister said they would push ahead with a planned offensive to take control of all of Gaza City despite growing international concern.

Now, the attack follows a report published by a U.N.-backed group, the IPC, on Friday. It says parts of Gaza are officially experiencing a man-made famine. The report also warns famine could spread without a ceasefire.

With us now is Avril Benoit. She is the executive director of the aid group Doctors Without Borders. Avril, thank you so much for your time and for being on the show. This is the first time the IPC has confirmed famine anywhere in the Middle East, again calling it in the report entirely man-made. We have seen reports of children dying from malnutrition, families going days without meals. Can you share what your teams are witnessing in Gaza's hospitals and clinics right now? AVRIL BENOIT, EXECUTIVE DIRECTOR, DOCTORS WITHOUT BORDERS: It's an intentional starvation of a population over many months and now with really false efforts to bring in food supplies and claim that they're bringing in enough, the Israeli authorities bringing in enough for the caloric needs of people, but it's -- it's not enough.

We have seen increasingly over the last almost two years, but certainly in the last six months, increasing levels of malnutrition. When we survey the -- the patients that we have coming in for catastrophic injuries, remember we have a lot of burn injuries from the relentless bombardment of Gaza, a lot of crush injuries, people with, you know, the most horrific orthopedic surgical cases, you know, all these things, when we -- when we do screen those patients for malnutrition, we're find -- finding an increasing level that are -- that are clearly in that danger zone.

So with this IPC report, it's just confirming something that we have been warning of for many months with periods of no access to food, not only for patients in our hospital who need good nutrition to be able to recover from their injuries, for the wider population, of course, many of whom are unreachable through the -- the terrible mechanism that was put in place with the very few distribution sites under the GHF, this foundation that is using starvation as a -- as a weapon of war under Israeli authorities and U.S.-backed mechanisms.

[13:10:01]

We are also seeing that our own staff are frequently reporting, now regularly reporting, that they don't eat every day. So all in all, it's a catastrophic situation for all the civilians in Gaza.

ROSALES: Well, Israel says it plans to also take over and occupy Gaza City. What do you think that escalation would mean for this humanitarian hunger crisis, something that you've said is intentional?

BENOIT: Yes, it's -- it's horrific on every level, and we should all be shocked by this because, of course, what we are seeing month after month in this is they're making the entire Gaza Strip uninhabitable with increasing rhetoric, essentially expressing intentions of genocide to ethnically cleanse people from this place to that place and eventually out of the Strip altogether.

They're -- they're destroying not only people's ability to survive with the basics of food and water and shelter and medical supplies, which we are often not allowed to bring in the basics of medical supplies that we need to be able to treat people. They're -- they're also clearly expressing an intentionality of genocide that -- that international court and -- and genocide scholars have all warned against, that there are such clear indicators now.

And I think we have to recognize that this is happening and not believe some of the falsehoods, the misinformation, that Israeli authorities are putting out there when they claim that they are providing.

ROSALES: How do you reconcile that? How do you reconcile what you are seeing, what your teams are seeing on the ground, these images that we have and the official lines coming out of Israel and the United States, Israel saying that there is no famine, we've heard Ben -- Benjamin Netanyahu say that, and rejecting this report too, rejecting where this information is coming from?

BENOIT: It contradicts the evidence that we have gathered in our medical data, in our facilities. And also we have been documenting why people come in. And so when you have these GHF sites, the distribution sites that are essentially drawing people to areas and then shooting them for trying to survive starvation, we're seeing gunshot wounds to the legs, we've been -- we've been counting the -- the numbers of patients, we've been hearing where they were injured.

They come in in mass casualty events as a result of these distributions. It just should remind us always that there has been a consistent reporting on the ground by the credible humanitarian organizations that have a lot of experience, a lot of credibility, who are reporting what is actually happening from a medical perspective. And what we hear in the statements from Israeli authorities and many in the U.S. administration also are an effort to misinform us, to -- to discredit the organizations that -- that are trying to help people survive this horrific circumstance.

So we should all be very wary of those lies, and I hope people recognize that -- that this is intentional, that this is an effort, and the public statements certainly corroborate this, that there's an intentional effort to really make these people in Gaza suffer as much as possible in order to clear them out of the area. We should all be absolutely beside ourselves about this.

And of course, the U.S. complicity, the world looking on, it is -- it is absolutely devastating when you put all the facts together from those of us who are on the ground and really listen to the -- the credible witnesses such as Doctors Without Borders and all the other aid organizations, including the U.N.

ROSALES: And the IPC report did notably say that because this is entirely man-made, it can be halted and reversed, but also said that the time for debate is over, there's no denying the crisis that is happening. Avril Benoit, thank you so much for your time.

BENOIT: Thank you.

ROSALES: Well, still ahead, homebuyers are reportedly backing out of purchases at a record rate. What's fueling the rise in cancellations and what it means for buyers and sellers?

Plus, popcorn serving robots, burgers, and drive-in movies. The new diner dividing West Hollywood that's dedicated to all things Tesla and Elon Musk.

[13:14:24]

And it's been 20 years since the historic devastation of Hurricane Katrina. I'll be joined by a survivor who shares her experience of the storm's enormous impact. (COMMERCIAL BREAK)

ROSALES: Welcome back. This week marks the 20th anniversary of Hurricane Katrina's landfall in New Orleans and the Gulf Coast. It is one of the deadliest and costliest natural disasters in American history. The storm and its aftermath also put a spotlight on the racial and economic inequalities for many people in the region. This week, Netflix will roll out a three-part documentary series produced by Spike Lee called "Katrina: Come Hell and High Water" where the people of New Orleans share their stories in their own words.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: You can look and see that this -- was racial.

UNIDENTIFIED FEMALE: Is anybody going to come help us?

UNIDENTIFIED MALE: We're part of a culture that we want a hero.

UNIDENTIFIED MALE: There's no blueprint for 80 percent of a major city being underwater. There's no blueprint for that.

UNIDENTIFIED MALE: Twenty 20 years later, this -- is still real.

[13:20:04]

PHYLLIS MONTANA-LEBLANC, HURRICANE KATRINA SURVIVOR: Twenty years to life, the time should fit the crime. Human lives cut down and out, left and waters to rot. Twenty years to life and my stomach still holds a knot.

(END VIDEO CLIP)

ROSALES: Incredibly powerful words there. I'm joined now by Phyllis Montana-Leblanc, the last person we heard from in that clip. She is a Hurricane Katrina survivor featured in that upcoming Netflix documentary. She also appeared as an actress on the HBO series "Treme," a post-Katrina HBO drama.

And if that weren't enough, well, she also wrote a book of poetry called "Not Just the Levees Broke." Phyllis, thank you so much for joining us. Really appreciate you coming on the show.

MONTANA-LEBLANC: Thank you for having me. Thank you so much for having me.

ROSALES: Of course, and can you start off by telling us where you were when Katrina hit? What you experienced? Bring us back 20 years.

MONTANA-LEBLANC: Oh, boy. I was in New Orleans in an area where my husband and I purchased a home, New Orleans East. We were in an apartment complex called the Carriage House Apartments. My sister Catherine and her son, Nicholas, lived about a mile away from us, so we all got together. So we were here in the kind of, if you would say, in the heart of New Orleans East when Hurricane Katrina hit. I want to say about 6:10 p.m. because I remember it being like that 6:00 a.m. mark. And that's when we started feeling the winds of Hurricane Katrina.

ROSALES: Yes.

MONTANA-LEBLANC: And I don't know if anybody -- if anybody fears sound. Sound more than visual is more frightening than the actual -- the actual act happening, the winds --

ROSALES: You heard it coming.

MONTANA-LEBLANC: -- just nearly drove me crazy. Yes.

ROSALES: Bring me to that moment when -- when the levees broke.

MONTANA-LEBLANC: Well, I always say, and I will always say because I experienced it firsthand as many people did, we survived Hurricane Katrina. Those winds that tore the -- the side of the apartment complex up and blew things around and stuff like that, we survived Hurricane Katrina.

Hurricane Katrina made landfall at, I think, a Category 3. And once we woke up that morning, once all the winds had slowed down and everything, all the helicopters came -- started coming through and we could hear them at a distance, we started noticing water rising because we didn't have any water on the ground. I mean, there was water from the rain, but it started rising.

And then, you know, one feet, two feet. And I'm like, OK, something's not right here. So we're trying to get radio reception and -- and hear what's going on. And that's when we heard about 7-ish, maybe 7:00 or 8 o'clock that morning, that the levees had breached in the Lower Ninth Ward and that there was 20 feet -- almost 20 feet. It hadn't gotten to 20 feet of water yet, but it was rising that fast when the levees broke in the Lower Ninth Ward.

And so we were getting that water from the Lower Ninth Ward in New Orleans East because they're not far from each other.

ROSALES: What happened to your home?

MONTANA-LEBLANC: That was begun in my apartment. We were in an apartment complex at the time. So we were on the second floor. My mom's apartment was across from us, from me and my husband Ron's apartment. And then Catherine, my sister, Catherine, and her nephew, Nicholas, of course, we got them together. So we were all basically huddled together and going from apartment to apartment before the water start -- the -- before flooding started coming. So we would, you know, we had a little barbecue thing going or whatever and getting the food together. And then the water started coming.

So that -- that's really when it started happening. That's when real reality kicked in, hearing that the levees had breached in the Lower Ninth Ward. We did not know because we didn't have any visuals. We didn't have any power or anything like that. So we didn't know the visuals of what it looked like until, you know, eventually we got the -- the evacuation of the people with the helicopters and stuff five days later. ROSALES: Yes. And those images gripped an entire nation, seeing people on the roofs, you know, asking for help, seeing so many boats picking up people. And it's been 20 years now since Katrina hit. Can you update us on where you live and how you would assess New Orleans two decades post the storm?

MONTANA-LEBLANC: We literally live about a mile from where we were. We purchased a home because once Katrina -- once the water subsided and once, you know, the people started coming in, the personnel started coming in to assess the damage and as well. And more importantly, the bodies, because there were so many floating and dead bodies, as most people saw in the first documentary, when the levees broke, those bodies that were floating.

[13:24:57]

I did not see them. We did not see them. But once we got, you know, like I said, once he evacuated us to San Antonio, Texas, we got to see how devastating Hurricane Katrina was for the city of New Orleans. And not so much as Hurricane Katrina, but those levees breaching. And when we saw that wall cracked in a -- in the Lower Ninth Ward, then we knew and we felt. And that's when that serious sorrow kicked in. And again, 20 years later, one lady asked me, this is about maybe a year ago.

She said, are you all still experiencing water? And I'm like, you know what? I think they have this thing called block where you block somebody from a social media site. You just -- there's no word block them.

ROSALES: Yes.

MONTANA-LEBLANC: It's been like -- it's been like 20 years here. And you ask me, do we still have water? No, we don't. I didn't even answer her. I just blocked her. Love that little -- the little thing you can do that with. But here we are 20 years later. We don't have water flooding. The city has come back because after Hurricane Katrina, if you remember, a lot of people were, I mean, everybody was united. Everybody was like, you know, we're together.

We're going to revitalize. We're coming back. They even had signs, you know, around the city. We're coming back. We're all coming back. And New Orleans did come back, but only proportionately, because I always tell people, don't take my word for it.

I mean, you go to certain areas of the city and they're oversaturated with stores, hospitals, clinics, urgent care clinics as well. We're almost inundated with those now. And so all of this -- this quality of life in areas that are deemed the good neighborhoods, New Orleans East has not revitalized.

We -- we have stores. We have a Winn-Dixie. We have, I think, another store. Oh, we have Walmart. Yes, we have Walmart. And we have corner stores. Our restaurants are KFC, Popeye's, Burger King, and McDonald's. There's a few restaurants in the area. So I'm not saying that we don't have any restaurants to go to, but when you do a comparison, if someone were to come down here from, say, CNN and go to different areas, we have districts, we have parishes.

And so when you go to these different areas, you -- you see -- you see the difference. There's a huge difference in the quality of life.

ROSALES: And Phyllis -- Phyllis, we could -- I swear, we need -- we need an hour, you and I, to talk about, you know, 20 years. That is -- that is a long time. And, you know, in such a dark moment, you found such light. You've launched, you know, an acting career, poetry so much. Phyllis Montana-Leblanc, thank you so much. Thank you so much for your time. And we'll chat again about this. We have a lot more stories to tell about Katrina.

MONTANA-LEBLANC: Absolutely. Thank you so much.

ROSALES: Thank you.

MONTANA-LEBLANC: All righty.

ROSALES: And tonight at 8:00 --

MONTANA-LEBLANC: Bye-bye.

ROSALES: -- speaking of that, CNN's Victor Blackwell hosts CNN's special coverage of Hurricane Katrina 20 years later. And then at 9:00, the new CNN original series explores the role that the New Orleans Superdome played in the city's recovery. Rebirth of the Superdome, New Orleans: Soul of a City, premieres tonight on CNN.

[13:28:21]

The Trump administration's immigration crackdown creating uncertainty for day laborers. Coming up, we're going to hear from a man who was caught up in a raid at a Home Depot, who now says he's afraid to go outside.

(COMMERCIAL BREAK)

ROSALES: Kilmar Abrego-Garcia, the man who was mistakenly deported to El Salvador in March, could be deported to Uganda within days. The Department of Homeland Security sent a notice to Abrego-Garcia's minutes to him after he was released from criminal custody in Tennessee, where he was being held on human smuggling charges.

The government is offering a plea deal in exchange for his deportation to Costa Rica instead of Uganda. One of Abrego-Garcia's immigration lawyers spoke with CNN this morning about that plea deal. Listen.

(BEGIN VIDEO CLIP)

BENJAMIN OSORIO, IMMIGRATION ATTORNEY FOR KILMAS ABREGO GARCIA: U.S. government knows they have an offer on the table from Costa Rica. So if you have an offer of asylum status to the U.S. government for an individual you say you want to deport who is a Spanish speaker and has a family here in the United States, why would you not take that over sending him to a country where he doesn't speak the language and is thousands of miles away from his family? So the only reason that you would choose Uganda over Costa Rica is to try to punish him.

(END VIDEO CLIP)

ROSALES: Abrego-Garcia's lawyers say he has until Monday to respond to that offer.

Day laborers looking for work outside Home Depots are being left in limbo as the Trump administration's immigration crackdown intensifies. There's been a wave of ICE arrests in the parking lots of home -- of the home improvement giant, but the company has remained relatively quiet about the raids saying it is not notified when ICE operations are taking place. CNN's Gonzalo Alvarado met with some of these day laborers and has more on this story from California.

(BEGIN VIDEOTAPE)

GONZALO ALVARADO, CNN CORRESPONDENT (through translator): It's been four months since Jesus Domingo Ros was picked up by U.S. immigration authorities outside a Home Depot in Southern California. Now, he says most of his time is spent cooped up in his apartment, hesitant to go out.

JESUS DOMINGO ROS (through translator): With what's happening, one is afraid.

ALVARADO (voice-over): Ros is a jornalero, a day laborer, who was detained by Border Patrol agents at the Home Depot parking lot in Pomona in April, accused of illegally entering the U.S. in 2022. He tells us he was released on bond and is now waiting for his next immigration court hearing in March of next year. Afraid to look for work, Ros keeps busy by cleaning his home, calling his three kids in Guatemala with the promise of better days.

[13:35:18]

He's one and only responsibility, a daily check-in with ICE through this wrist monitor. Ros agrees to go for a walk, but he's not allowed to go out. It's sunny, a typical California summer day. It's the busiest season, he says. He spots a yard and is quick to point out one of many jobs he used to do as a day laborer.

ROS (through translator): For example, this, look, this old grass. It needs to be replaced. Take out the old and replace it with the new.

ALVARADO: Is that what you did?

ROS (through translator): Yes, that's what we did.

ALVARADO (voice-over): This father of three is one of many day laborers runned up by ICE officials in recent months outside Home Depot stores, known as unofficial hiring spots for these type of workers. An easy target for ICE. The wave of arrests sparked national protests in June. Twenty-one-year-old Guatemalan, Johnny Garcia, was among those picked up outside the Pomona Home Depot.

ALVARADO: Did they say anything before arresting you? UNIDENTIFIED MALE (through translator): No, they didn't ask me anything.

ALVARADO (voice-over): He was also released on bond and is hoping for an immigration judge to grant him permission to stay in the U.S. Ros and Garcia were both detained during a targeted operation for a known fugitive, according to a statement from Customs and Border Protection sent to CNN. Alexis Teodoro is the worker rights director for the Pomona Economic Opportunity Center. His office is assisting Ros and Garcia with legal help.

ALEXIS TEODORO, WORKER RIGHTS DIRECTOR, POMONA ECONOMIC OPPORTUNITY CENTER (through translator): They are workers, sons, parents, brothers, hardworking people who earn their daily bread.

ALVARADO (voice-over): And though Home Depot has said they aren't notified when ICE operations will happen or involve in coordination and they are required to follow local and federal laws, Teodoro has a request for the retailer.

TEODORO (through translator): We are asking Home Depot for something very basic, to not allow immigration authorities to enter their parking lots.

ALVARADO (voice-over): As more day laborers gather at the curve, another day in the shadows, life goes on for most. But for Ros, Garcia and many others in parking lots across the country, their future is uncertain.

Gonzalo Alvarado, CNN, Los Angeles.

(END VIDEOTAPE)

ROSALES: Gonzalo Alvarado, thank you.

Also ahead, if you are ready to buy a home, the market might finally be turning in your favor. What buyers and sellers need to know right now about the changing real estate landscape.

(COMMERCIAL BREAK)

[13:42:12]

ROSALES: After years in a seller's market, buyers have finally just started getting the upper hand. Prices and mortgage rates are starting to fall, but a new Redfin analysis shows that purchases of homes are also getting canceled at a record rate.

Roughly 58,000 home purchase agreements, about 15 percent, fell through last month as economic uncertainty has more buyers second- guessing that sale. Joining me now to discuss is real estate attorney, Pierre Debbas. Pierre, thank you so much for being with us. Have you personally seen these home purchase agreements getting canceled?

PIERRE DEBBAS, REAL ESTATE ATTORNEY: You know, thanks for having me today. You know, our practice primarily focuses on New York City and the Hamptons, and those markets, mainly due to the level of affluency, have been more stable than the rest of the country. Throughout the rest of the country, you are seeing a tremendous amount of trepidation by the initially first-time home buyer demographic, because we're finally seeing uptick in inventory coming on, which is the first time you can say that in three years.

But like you highlighted, there's so much uncertainty that consumer confidence is at an all-time low. And right now, you know, we're sitting here present day, we're at a low in terms of mortgage rates for 2025, and I think it's almost but certain we're going to have a Fed cut next month. So when you look at it with an increase in inventory and, you know, a pending and hopefully imminent rate cut, where's the sense of urgency in the market, right? The sense of urgency has been completely sucked out.

So I think that that's really why you're seeing such a, you know, I mean, that's the -- that's the largest percentage of canceled contracts that I can remember in years.

ROSALES: So does this mean it's a buyer or seller's market? What do you think?

DEBBAS: You know, I think right now it's a buyer's market. You know, I -- I -- we have a lot of clients in our -- in our practice who are taking advantage of the opportunity to get in now before it becomes ultra-competitive. And, you know, unfortunately, the way it works in the mortgage world is that the larger of the banking relationship you have, per se, the more access you have to favorable interest rates.

And those people are taking advantage of the opportunity to buy now before it becomes pandemonium. You know, if we're, you know, most of Wall Street is predicting up to four cuts this year, rate cuts. If you get to a point where you're 100 basis points lower today and mortgage rates can hover between 4.5 percent to 5 percent, I think the market takes off and you have other pandemonium.

And the reason I say that is that we've had three consecutive years of 30-year low in transaction volume throughout the United States in housing. Now, this is real pent-up demand.

I can't -- I've been practicing law for 20 years. We have the largest residential practice in New York City. I can't remember the last time I saw this long of a decline in transaction volume that you know that when the cycle turns, it's really going to turn significantly.

[13:44:57]

ROSALES: And you were mentioning these expected rate cuts. While mortgage rates have been falling in hopes of that coming in September, there's no guarantee that that's actually going to happen. We've been thrown curveballs before by the Fed. I do want to show our audiences the 30-year fixed mortgage rate averaged 6.58 percent, the lowest level in 10 months. What does that tell you, all of this information? And is it more beneficial for a buyer to maybe wait it out?

DEBBAS: You know, to be honest, it tells me we're nowhere near ready in terms of boosting transaction volume. 6.8 percent, the exact number you mentioned, forgive me, is nowhere near what it's going to take to get the market going again. Think about it, 70 percent of America has a rate locked in under 4. You have to create a market where sellers have an incentive -- incentive to sell at a value that, you know, we've created in a post-pandemic world, and buyers can afford it.

Right now, you have an absolute affordability crisis in America. So the only way to fix this is lowering rates. There's no other special formula. It's going to take years to create the supply, additional supply, that will bring prices down. And even that, you're not going to create development without reduced -- reduced rates because everything got so expensive. Insurance is at an all-time high, cost of labor, cost of materials, cost of land.

So economically speaking, you're going to be in this stagnant world until rates come down. That's really it. I know inflation may be slightly higher than the Fed would like. I know they want to get closer to a 2 percent target, and it's not fully there yet, but it's looking like it. Employment statistics were not great, which is, you know, really going to, I think, put the pressure to actually cut rates.

But at the end of the day, if you want to help housing and you want to get housing going, which is the backbone of our GDP in this country, you have to cut rates.

ROSALES: So if Jerome Powell were in front of you, the Fed chair right now, you would tell him, cut, cut, cut.

DEBBAS: I would tell him, you're late. You should have done this a year ago. Cut, cut, cut. But in terms of housing, again, it is an absolute crisis at the moment. You know, Americans cannot afford to buy a home. Home prices went up 50 percent during the post-pandemic world, 50 percent. And now mortgage rates almost tripled. You tell me how anybody in this country is going to afford to buy a home.

ROSALES: Yes. Pierre Debbas, thank you so much for your time.

DEBBAS: Thanks for having me.

ROSALES: Thanks.

All right. We'll be right back.

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[13:51:50]

ROSALES: The site of one of the deadliest mass shootings in U.S. history has now become a point of tension between the state of Florida and the Orlando community. That is after the state painted over a rainbow crosswalk outside the Pulse nightclub. That crosswalk was honoring the 49 people killed there in 2016. The overnight removal comes as part of campaigns by the state and the Trump administration to paint over, quote, asphalt art. The dual directives call it a safety measure to make roads easier to navigate without distractions. Meanwhile, the community is making sure its message does not fade. CNN correspondent Rafael Romo is joining us here with the latest. What can you tell us about these tensions?

RAFAEL ROMO, CNN NATIONAL CORRESPONDENT: Well, number one, it seems like it's been in the works for a while because the effort to remove pavement surface art apparently started in June when the Florida Department of Transportation issued a memo prohibiting crosswalk markings, including rainbow crosswalks and others. The memo said that pavement art is, quote, associated with social, political, or ideological messages or images and does not serve the purpose of traffic control.

CNN affiliate WESH in Orlando witnessed the moment Wednesday night into Thursday morning when Florida state workers removed a rainbow crosswalk in Orlando outside the Pulse nightclub, as you mentioned. The rainbow crosswalk was painted to commemorate the 49 people killed at the LGBTQ-friendly nightclub in 2016. Orlando officials and members of the LGBTQ community in the area have condemned the state's actions. One of those demanding answers is Florida State Senator Carlos Guillermo Smith, the first openly LGBTQ Latino elected to the Florida legislature.

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SEN. CARLOS GUILLERMO SMITH (D-FL): They illegally vandalized city property without providing the city of Orlando notice or getting their approval to remove this rainbow crosswalk that was painted here, not only to remember the lives of the 49 mostly LGBTQ people of color who were murdered here.

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ROMO: Florida Governor Ron DeSantis responded directly to the senator's post on X saying the following, quote, we will not allow our state roads to be commandeered for political purposes. Orlando Mayor Buddy Dyer also condemned the removal of the rainbow crosswalk.

This callous action of hastily removing part of a memorial to what was at the time our nation's largest mass shooting without any supporting safety or discussion is a cruel political act, he said. This weekend, people opposing the removal of the rainbow crosswalk converged at the site and symbolically colored it again using sidewalk chalk.

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MICHELLE GREEN, COCOA BEACH RESIDENT: Things that are actually important rather than showing up in the middle of the night to paint over a sidewalk. It just seems like -- like cowardice.

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ROMO: And finally, Isabel, the removal of pavement art seems to be part of a national policy from the Trump administration. In June, U.S. Transportation Secretary Sean Duffy sent a letter to governors in all 50 states saying intersections and crosswalks should be kept free from distractions. But again, we're going to be hearing about this because apparently there's a deadline in September to comply with the directive.

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ROSALES: It's interesting. I was reading the "Tampa Bay Times" and over in that area, in St. Petersburg, they had a similar rainbow crosswalk and they actually saw a reduction of incidents of car crashes with that painting year over year. So it's interesting seeing this from the administration there and the state saying that this is for safety reasons.

ROMO: Yes. That's what they say. It's not a distraction. They say it's so colorful that people see it better than a normal one. But again, that's part of the debate.

ROSALES: Yes, municipalities, some would disagree. Rafael Romo, thank you so much.

Well, coming up hours from now, President Trump will host South Korea's new leader at the White House. What we can expect from this key summit. Stick around.

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