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Early Start with Rahel Solomon

Trump To Speak Today In Davos Amid Greenland Tensions; Trump Marks First Year Back In Office With Rare White House Briefing; Massive Winter Storm Set To Move Across Southern U.S. Aired 5:30-6a ET

Aired January 21, 2026 - 05:30   ET

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

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[05:32:33]

RAHEL SOLOMON, CNN ANCHOR: Welcome back to EARLY START. This is your business breakout at 5:32 Eastern.

U.S. futures ahead of the opening bell on Wall Street are green, which is a nice change from yesterday where all three averages ended in the red. That was due to concerns over tariff threats and Greenland -- the so-called "Sell America" trade as investors dumped bonds, the dollar, stocks, all of it.

All right. Checking some other headlines today in the business world, Amazon's CEO says that President Trump's sweeping tariffs could partially be to blame for higher prices on its website. Other retailers, like Walmart, Target, and Home Depot, have publicly said that tariffs are making products more expensive for them as well.

Netflix has revised its offer for part of Warner Bros. Discovery, CNN's parent company. The streaming giant says that it is prepared to pay all cash for Warner Bros. and HBO rather than a mix of cash and stock. Netflix and WBC hope that the amended plan will help fend off Paramount's hostile takeover bid for all of Warner Bros. Discovery.

New research from Lending Tree found child care is one of the biggest financial burdens for American parents. It said that parents need to earn about $400,000 a year in order to comfortably afford care for two children. Lending Tree's breakdown is based on the average cost of child care for an infant and a 4-year-old, which is about $28,000 a year. Perhaps no surprise to many parents at home.

NATO and European leaders are preparing to welcome President Trump to Davos, Switzerland. He will address the World Economic Forum today. And many are hoping to hear a willingness to compromise on his threats to take over Greenland and impose tariffs on countries that stand in the way.

CNN's Richard Quest spoke with Microsoft president Brad Smith about the importance of Trump's meetings and the U.S. business relationship with Europe.

(BEGIN VIDEO CLIP)

BRAD SMITH, PRESIDENT, MICROSOFT: I have to say I'm encouraged that President Trump said today that he will meet with people here. There will be a conversation. I think we all need to reflect on the fact that the future of Greenland is not only a security issue, but we need to think and talk about it in the context of all of the other shared issues across the Atlantic.

Jobs -- 10 million Americans work for European companies or have jobs that are based on trade with Europe. Trade itself -- 40 percent of American exports go to other NATO countries. Investment -- 70 percent of foreign investment into the United States comes from the rest of NATO. Technology -- Europe is the American tech sector's biggest market after the United States itself.

[05:35:15]

It all depends on trust. Trust requires dialogue. We should welcome the conversations that will take place here.

(END VIDEO CLIP)

SOLOMON: Professor Julian Hinz is the head of the Research Center Trade Policy at the Kiel Institute for the World Economy. His work focuses on tariffs and their impact on the U.S. economy. And he joins us live at this hour from Germany. Julian, great to have you this morning.

You have studied who U.S. import tariffs impact most and concluded that importers and U.S. consumers bear 96 percent of the tariff burden. Break down that research for us -- what you found.

JULIAN HINZ, HEAD OF RESEARCH CENTER TRADE POLICY, KIEL INSTITUTE FOR WORLD ECONOMY: Yes, so thanks for having me.

So the general idea is that you can just look at what prices look like at the U.S. border and if they have not changed then the tariff just comes on top. If foreign exporters would bear some of the burden, or all of it, then the prices would come down in order to make up for that tariff affect. We don't see any change in those prices at the U.S. border and that means someone on the American side is paying for this.

SOLOMON: But how -- you know, the Liberation Day tariffs -- and the caveat, of course, is that ultimately, they were watered down quite significantly. They weren't nearly as catastrophic as economists had warned. I mean, Julian, is it possible that could be case again with these tariffs if they go into effect?

HINZ: Well -- so tariffs initially were found to be extremely high and then we also did see this escalation with China where tariffs went up to 145 percent. So there was a lot of back-and-forth when it came to actually apply tariffs. And then you had these two examples of India and Brazil where out of -- sort of out of the blue tariff rates up to 50 percent were imposed. And so using those tariff rates we can see that actually, you know,

prices really did not change. And that means that the American importers and eventually -- probably the American consumers are paying for this more than the exporter side.

One thing though. Obviously, trade volumes went down and that's bad for everyone. That's also bad for the exporters. So it's no -- we're not making a statement that, you know, this was all on the U.S. -- all on the U.S. No -- it's really bad for the exporters as well. But when it comes to this revenue that's being generated that's talked about, that's coming from the U.S. itself.

SOLOMON: So bad for the exporters, bad for the importers, bad for American consumers. Who is it good for?

HINZ: Well, if you want to talk about big money being raised for the U.S. government, you know, that maybe is something that works great if that's you're -- if that's what you're aiming for.

But really, I mean, tariffs are a lose-lose, so it's bad for -- bad for the consumers, for the importers, for firms involved in this, and it's clearly bad for those companies that want to sell something. But it also is bad for, say, U.S. producers who are -- who are -- need these inputs into their own production that's been sourced from abroad.

So this really doesn't help anyone aside from the point that maybe you do want less imports just for the sake of it. But I guess for those countries that we're talking about right now -- these are allies. Their trade is actually enhancing not only security but also welfare.

SOLOMON: And then walk us through what you might expect to see in the markets. I mean, at this point, investors have become quite experienced with the trade tariff on-off appetite. I mean, we saw quite a knee-jerk reaction yesterday. But, you know, in the past we've seen really significant declines and then we see a bounce back, and it's sort of almost as if investors are looking past the rhetoric.

What would you expect to see in this situation? Do you expect more volatility? Do you think things will stabilize? What would -- what would you expect?

HINZ: I think that really depends on what's going to happen in terms of the actual application of these tariffs. So if these tariffs from the U.S. side -- these 10 percent tariffs that are being talked about right now -- if these are going to be implemented, I'm sure that the European side will react, which may again spark retaliation tariffs. Again, retaliation by the U.S. that was already hinted at. And so this escalation would clearly not be good news for markets.

If -- I think the U.S. -- the U.S. side -- the U.S. government softens the rhetoric and the Europeans would not respond if there are not tariffs, then I think, you know, this is going to be better for markets.

SOLOMON: And then just lastly, Julian, do you find that people are surprised? I mean, you have dug into the numbers, the stats, the research are surprised by how much between Europe and the U.S. we trade back-and-forth. I mean, give us a sense of just sort of the scope of products we're talking about here.

[05:40:00]

HINZ: No. I mean, it's one of the most intense or one of the biggest trade relations, if not the biggest trade relations in the world. If you take the EU as one block to the U.S. there's -- 10 years ago we talked about a possible free trade agreement that would have increased trade flows even more across the Atlantic.

But it's clearly -- you know, these are two economic powerhouses. It's not just the U.S. The EU is huge market -- half a billion people, an enormous single market. If you just export to one European country, you know, you have the whole single market -- EU single market for you. And so, you know, this is something that should be leveraged as power and not be -- should not be a conflict between those two blocks, I think.

SOLOMON: OK.

Julian Hinz, we appreciate you coming on and explaining your research for us. Thank you.

HINZ: Thank you very much.

SOLOMON: And still ahead for us we'll have much more from Davos, as well as some of President Trump's latest comments casting doubt on NATO and ramping up pressure on the alliance.

We'll be right back.

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[05:45:25]

SOLOMON: Welcome back. I'm Rahel Solomon. And here are some of the stories we are watching for you today.

President Trump will address the World Economic Forum in Davos, Switzerland today. He is taking a backup plane after Air Force One returned to the U.S. with what the White House called a minor electric issue. NATO and European leaders hoping to diffuse tensions over Trump's threat to take control of Greenland.

The U.S. Department of Justice has subpoenaed at least five of Minnesota's top officials, all of them Democrats. They include Governor Tim Walz and Minneapolis Mayor Jacob Frey. Sources say that the agency is investigating possible obstruction of ICE agents performing immigration raids in the state. Minnesota's leaders denounce the subpoenas and say they will not be intimidated into silence.

For the first time, the Trump administration has acknowledged that a Department of Government Efficiency, or DOGE, employee inappropriately shared highly sensitive Social Security data to an unsecured server. The Justice Department revealed the violation of security protocols in a court filing on Tuesday.

President Trump's Davos departure coincided with the first anniversary of his return to office, and he took the moment to once again cast doubt on NATO amid the growing tensions over Greenland.

CNN's Kristen Holmes has more from the White House.

(BEGIN VIDEOTAPE)

KRISTEN HOLMES, CNN SENIOR WHITE HOUSE CORRESPONDENT: President Trump making a rare appearance in the briefing room to mark one year into his second term. Most of his talking, which was nearly two hours, was an airing of grievances. He spent time focusing on his own team, saying that he had bad public relations. He talked about what he had been doing for the economy. He talked about the fact that he didn't think anyone in his team was promoting all that his administration had done.

And as somebody who was in the room, it seemed as though he had nothing prepared. That he had a booklet that was called -- the same booklet the White House gave the press -- "365 Achievements in 365 Days." And he thumbed through it, reading some of them, elaborating on some of them, and at times rambling onto completely separate topics.

But one thing that did come up -- and this, of course, comes as President Trump's rhetoric has continued to escalate with our European allies -- was the concept of NATO. Whether or not he supported NATO. Here's what he said.

DONALD TRUMP, (R) PRESIDENT OF THE UNITED STATES: I did more for NATO than any other person alive or dead. Nobody has done more for NATO, and I think for the most part they'll tell you that. I think you could ask the secretary general about that, but he's said it a lot. I've done more for NATO than anybody. And I see all this stuff -- but NATO has to treat us fairly, too. The big fear I have with NATO is we spend tremendous amounts of money with NATO. And I know we'll come to their rescue, but I just really do question whether or not they'll come to ours, you know? I'm just asking -- just saying, right?

HOLMES: Now he has used this kind of rhetoric before but, of course, given the context of Greenland, of the current situation, of what we have seen over the last several days, it has taken on new meaning.

Now, President Trump is headed to Davis where he is expected to meet with at least some of these world leaders to talk about Greenland. That's one of the things that he said. But it's unclear whether or not there's going to be any kind of resolution.

While President Trump himself seemed to indicate that whatever conclusion they came to on Greenland would be something that NATO would be OK with or even happy with, when you talk to both sides -- the Trump administration as well as our European allies -- it doesn't seem as though there is any common ground currently.

Kristen Holmes, CNN, the White House.

(END VIDEOTAPE)

SOLOMON: Prince Harry could testify anytime now at London's high court. He and six other public figures are suing the publisher of The Daily Mail over alleged privacy violations spanning more than two decades. The allegations include phone hacking and obtaining private information by deception. The defendant, Associated Newspapers, calls those claims smears. Elton John and actress Elizabeth Hurley are among the other defendants.

Still to come, freezing rain, ice, and snow -- it is all part of a winter storm set to cover most parts of the U.S. later this week. We show you where it's headed when we come back.

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[05:54:05]

SOLOMON: Welcome back.

Parts of the southern U.S. and East Coast are preparing for a massive winter storm set to move across the country later this week. CNN meteorologist Chris Warren has the latest forecast and what areas will be impacted.

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CHRIS WARREN, AMS METEOROLOGIST: We are tracking a high-impact winter event for the South. But before we get to that here is this. The lake effect snow continues to drop several inches of snow over the next few days, looking at the potential for a foot and maybe even a couple of feet of additional snow.

And then a little bit of a break for some of the coldest air to the south, but by this weekend cold air. That cold air coming down from the Arctic locking in place in some areas down to about or near the Gulf Coast. That sets the stage for what's to come.

[05:55:00]

Here is the forecast radar. So what the precipitation could look like and where it could be through time. This is 8:00 on Friday. Green is rain, pink is ice -- that freezing rain -- and then purple is snow -- these colors up here. So this is Friday.

Now into Saturday. An ongoing ice event and snow -- possibly heavy snow for parts of the mid-South and eventually even into parts of the Carolinas and coastal areas as well for the snow. But some of the highest impacts -- some of the biggest problems will be in the pink.

The pink is where from Atlanta to Dallas and areas in between, and even beyond, could have ice that -- as that rains falls through the freezing air, freezes on contact to roads, to sidewalks, to powerlines, to trees. And with a little bit of wind we're going to see a lot of problems. Power outages that could last for days with temperatures staying below freezing for the same period of time. So we're looking at a big and serious potential for winter impacts and long-lasting power outages and difficult if not impossible travel.

The details still need to be worked out. The biggest issues, again, are going to be in the pink if this does end up staying here. So one thing to watch is going to be where does the snow and where does the ice line set up, so stay tuned.

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SOLOMON: All right. Now to a stunning look at the Northern Lights from space. A Russian cosmonaut on the International Space Station shot this video of an Aurora shimmering over Earth. The light show has been especially strong in the northern hemisphere the past few days thanks to one of the most powerful solar storms to reach the planet in the last 20 years. That is incredible.

Well, you may remember the two NASA astronauts who unexpectedly spent nine months in space because of technical issues. Well, on Tuesday, Suni Williams joined Butch Wilmore in announcing her retirement from the Astronaut Corps. Throughout her long career she has logged 608 days in space and accrued 62 hours free-floating in space across nine spacewalks. Her retirement comes months after she and Wilmore concluded their troubled Starliner test flight mission to the Space Station.

Second lady Usha Vance and U.S. Vice President JD Vance are getting ready for baby number four. The couple shared their news on social media saying both mom and baby are doing well. They're expecting a boy. He's due in late July, marking the first time a sitting second lady will give birth while in office.

And the oldest son of soccer star David Beckham and former Spice Girl Victoria Beckham says that he doesn't want to reconcile with his parents. It comes after a shocking -- or maybe not so shocking social media post.

CNN's Lisa Respers France has more details.

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LISA RESPERS FRANCE, CNN REPORTER: Brooklyn Peltz Beckham has confirmed something on social media that's been speculated about for years, and that is that he and his family are feuding. In a six-page social media statement he talked about the fact that he and his family are not getting along and at that crux of the matter appears to be his marriage to his wife, actress and model Nicola Peltz Beckham, whom he claims his family has never liked.

Now, according to Brooklyn, he says that his parents have controlled his life his entire life and he believes that they're trying to also control the narrative about his marriage. He's accused his mother, Victoria Beckham, of dancing inappropriately with him at his wedding, and also says that his parents are very performative about what they show on social media as they are trying to pretend like all is well.

But according to his statement, all is not well. And the young man also says that he has no desire to reconcile with his family.

Lisa Respers France, CNN, Atlanta.

(END VIDEOTAPE)

SOLOMON: CNN has attempted to contact David and Victoria Beckham for a response but haven't heard back just yet.

The Indiana Hoosiers plan to celebrate their National Football Championship this Saturday in Bloomington. The team returned to Indianapolis on Tuesday after completing their perfect 16-0 season with a victory over the Miami Hurricanes. This is the school's first football championship.

Heisman trophy-winning quarterback Fernando Mendoza is widely expected to be the number one pick in the NFL draft in April.

To Major League Baseball now. Carlos Beltran and Andruw Jones, two of the greatest outfields of their generation, have been elected to baseball's Hall of Fame. Both received more than the necessary 75 percent of the vote from the Baseball Writers Association of America. They will be inducted in Cooperstown, New York in July along with former second baseman Jeff Kent who was voted in last month.

Beltran and Jones were named All-Stars several times during their career, and both won the Gold Glove Award multiple times. In 1996, Jones, at 19 years and five months old, became the youngest player to hit a home run in a World Series game.

[06:00:00]

And tennis star Naomi Osaka turning heads at the Australian Open, and it's not just because she won. She arrived at the court dripping head to toe in athletic couture. She wore a blue tie-dyed dress with green ruffles, wide-leg brimmed pants, a wide-brimmed hat with an attached veil, and she carried a white parasol. Osaka said that the look took months to design with her sponsor Nike and was inspired by Australian coastal themes along with her love for jellyfish.

OK. That'll do it for us here today. "CNN THIS MORNING" starts right now.