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First Move with Julia Chatterley
European Leaders Suspect Sabotage in Pipeline Leaks; Tampa International Airport Suspends Operations; El-Erian: The Situation wasn't great now Problems Amplified; Report: U.S. Warned Allies about of Nord Stream Attack; Social Media Video Shows Demonstrations Continue; Thousands Evacuated as Typhoon Noru Lashes Vietnam. Aired 9-10a ET
Aired September 28, 2022 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:00]
(COMMERCIAL BREAK)
JULIA CHATTERLEY, CNN HOST: A warm welcome to all our First Movers around the globe. And a jam packed show coming up for you over the next hour
including a suspected sabotage the EU and NATO saying leaks in the Nord Stream Pipelines were caused deliberately strong reactions from European
leaders plus, hurricane Ian extremely dangerous category four storms about to make landfall in Florida. We'll take you there for all the latest and
from the hurricane too.
A financial storm and global bond and currency markets as global bond prices for the U.S. 10-year treasury yield. Just to give you a sense,
briefly hitting 4 percent for the first time in more than a decade you can see we're a bit lower than that now, but just the sheer volatility that
we're seeing in these bond markets important too.
Shift to what we're seeing in the United Kingdom, the Bank of England temporarily scrapping plans to reduce the size of its balance sheet so
called quantitative tightening. Instead, it's going the other way around. It's intervening now to buy longer dated government bonds to try and force
bond yields lower they've cited the risk of financial stability instability, this after the IMF and Moody's. The rating agency criticized
the British government's fiscal policy, urging it to reevaluate the massive tax cuts announced last week.
As top economist Mohamed El-Erian says yields are in the driver's seat he will join us later on in the show to discuss what the Bank of England's
announced on whether it needs to go further including short term rate hikes. No surprise that the fair we see in the bond market translating to
lower stock prices, although as you can see what we've seen so far, pre market this morning, we are seeing a tilt to the top side now for the DOW
and the S&P 500.
Remember, we saw similar yesterday after what five consecutive days of losses and we lost ground yesterday. The question is, can we finish this
session in the green or will we tilt lower as the session progresses? What about Asia? Well, I can give you a look stocks, they're all closing in the
red as well, with the HANG SENG down more than 3 percent of China's currency, the Renminbi or the one hitting the lowest level versus the U.S.
Dollar since 2008. Sentiment not helped by fears over more COVID lock downs in the Shenzhen region too. OK plenty on the show to come up explanation of
what we're seeing. But for now, let's get more on that suspected sabotage of the Nord Stream pipelines.
Clare Sebastian has been following the story. Clare, we were careful, but we suspected sabotage yesterday when we were discussing this. What more do
we know and a stringent response from several European leaders on this?
CLARE SEBASTIAN, CNN CORRESPONDENT: Yes, Julia this is an incident now involving multiple countries, multiple European leaders not holding back
from calling this a deliberate act or saying they suspect it's a deliberate act. Even the NATO Secretary General Jens Stoltenberg tweeting this morning
he discussed the sabotage, he says on the North Stream with the Defense Minister of Denmark and he says they address the protection of critical
infrastructure in NATO countries.
So that is pretty serious when you see the NATO Secretary General, coming out to say that now we have a situation where concerns about security in
the region are increasing. Denmark is increasing its presence in the Baltic Sea this morning sending an additional two ships near that island of
Bornholm, where these leaks.
Took place the Danish Defense Minister saying Russia has a significant Military presence in the Baltic Sea region and we expect them to continue
their saber rattling concerns to also amounting around overall security to critical energy infrastructure. The EU saying it's going to try to take
steps to increase its resilience in energy. Security and meanwhile we aren't on the wiser about why this actually happened. Despite these
suspicions,
Denmark has said that while we see this sort of geezer like moves on the water, the gas continues to flow. They think it'd be a week or two before
they can even get down there and start investigating the Kremlin for its part pretty strong words this morning describing any accusation that it
might have been Russia involved in the sabotage as predictably stupid and absurd, Julia. CHATTERLEY: Yes, says a great deal. I mean, seismologist has
detected underwater explosions. And I'm quoting near the pipelines on Monday. But of course, it's said that there it's unclear if those are
connected to the leaks, and you can make all of this what you will.
The comments from Ursula von der Leyen, though I think were quite interesting because she, to your point, talked about this idea of
disruption to active European infrastructure, energy infrastructure, and that being unacceptable. Let's be clear, there was already disruption to
gas supplies.
[09:05:00]
CHATTERLEY: And we knew that now we're talking about damage to the infrastructure specifically. And that there will be the strongest possible
response amid all the talker further sanctions have an agreement on further sanctions Clare, what might they do?
SEBASTIAN: Yes, it's really not clear at this point, Julia, because this really raises the stakes. This is far beyond what we've seen so far. And
the energy war that has been going on alongside the war in Ukraine, so far, it's just been sanctions from the European side and Russia responding by
cutting back on its gas deliveries.
Now, even before we know what actually happened here? This puts actual infrastructure, physical targets into this equation. So what we expect is
that we're going to see Europe step up security around these infrastructures, these pipelines and various other parts of their energy
security.
And also the other part of this to bear in mind here is that this takes the Nord Stream 1, which up until early June had been the biggest single artery
supplying natural gas to Europe off the table completely. It was already cut to zero as of the beginning of September, but now Europe has to grapple
with winter fast approaching and really no prospect that this pipeline will be repaired in time even if Russia was going to get stopped restart sending
gas through it. So this really a warning shot in multiple ways for Europe.
CHATTERLEY: Yes, and raises huge and broader questions about infrastructure, security, energy infrastructure, and perhaps beyond too, to
your point, Clare Sebastian, thank you so much for that.
OK, let's take it to Ukraine now, pro-Russian authorities say for occupied regions of Ukraine voted in huge majorities to join the Russian Federation.
The vote has been widely condemned by the Western Ukraine as a sham. Nick Paton Walsh has all the latest.
NICK PATON WALSH, CNN INTERNATIONAL SECURITY EDITOR: The results partial, in some cases complete in others exactly what anybody expected high 90s
alleged approval for joining Russia. This is of course, a sham referendum where any votes that were indeed cast were likely done at the barrel of a
gun with Russian soldiers carrying ballot boxes door to door.
So even in that context, though, the message is exactly what the Kremlin wanted a sort of Soviet legacy of essentially faking mandates for
geopolitical aims they already had, what happens now?
Well, quite quickly, we're going to see this take place in Moscow.
It appears that some of the Russian appointed leaders of these areas, the occupied areas, one of them from the hands, he's on his way to Moscow, so
he says, then we'll see the two rubber stamp chambers of Russian Parliament essentially draft this into law for Putin to sign with the British Ministry
of Defense saying he made us a speech to both Parliament's on Friday to indeed announced the annexation.
The U.S. and the EU saying sanctions will follow. But the ultimate question here. What is this change for a Russia? That is losing with its
conventional army on the battlefield for Russia, whose partial mobilization has done very well to stir internal dissent, protest and chaos, but hasn't
yet translated into an improved performance for them on the front.
Ukraine still moving forward incremental gains as always, but Ukrainian president Volodymyr Zelenskyy, saying that they will have some positive
news they think to share soon and at the same time too, saying what we're seeing from Russia with this annexation vote is them attempting to steal
someone else's territory.
Big concerns, though, that if Russia continues to falter militarily, and continues to claim these areas as Russia proper and that it has the right
to use its full arsenal to protect them? We may see a significant Russian escalation in the days ahead, possibly even reaching towards their nuclear
arsenal, some are concerned.
CHATTERLEY: OK, let's move on the International Monetary Fund's stepped into Britain's currency crisis in a stinging rebuke gets urging the
government to "Reevaluate" huge tax cuts announced last week. Warning that they could increase inflation and inequality stepping in the Bank of
England says it'll buy government debt on whatever scale is necessary.
Anna Stewart joins us now. Anna I have my head in my hands. The key line from the IMF and let's be clear, the IMF has some previous and getting
things wrong in the U.K. economy. But in this regard, I think there's a pretty broad based agreement. It's important that fiscal policy does not
work at cross purposes, to monetary policy.
And they've left the Bank of England between a rock and a hard place now having to tighten policy in various guises into a slowdown. What do we make
of the announcement today from the Bank of England?
ANNA STEWART, CNN REPORTER: I mean all of this just adding really isn't it to a chorus of condemnation against this new government's fiscal plan. A
stinging rebuke from the IMF and in terms of what the Bank of England is doing here is they're being forced to act next week. They were actually due
to start selling down their U.K. government bond portfolio as a result of QE programs past.
Instead, they're going from QT, Quantitative Tightening straight to quantitative easing. This is not the position they wanted to be in but
looking at that statement today. They were talking about the dysfunction on the market and they said if that was continued or worsen. There would be a
material risk to U.K. financial stability.
[09:10:00]
STEWART: This is nothing to do with monetary policy at this stage this is the bank looking at financial stability for the U.K., let that sink in.
It's extraordinary. And they have said, as you say, whatever scale is necessary. So we don't even know the size of these bond purchases at this
stage. Now, looking at yields right now and U.K. government bonds, the 10 year dipped a little, it's still around the 4 percent mark. I believe,
though last time I checked.
The fact of matter is, as I'm ever said, we had the U.K. government moving in one direction. The Bank of England being forced to move in the other and
this is a pool, but foreign Investors certainly aren't going to like. And frankly, it's not doing much, not just in terms of investor confidence. But
I think for public confidence in the U.K just last week, an announcement about tax cuts and freezing your energy bills.
And now we're seeing mortgages being pulled from various high street banks and people starting to question whether they'll be able to afford their
mortgages next year, if they're not on a fixed rate, given the expectation from the Bank of England.
Interesting note from JPMorgan today, they say the optics are not favorable for the bank. And will inevitably prompt discussions about fiscal dominance
and a monetary financing of the deficit. But of course, the Bank of England has very little areas to maneuver at this stage, Julia. CHATTERLEY: Yes,
I'm just wanted to say I was just going to try and tell my team that to remove that, that line across the bottom, which I think is a dangerous
thing today. This is not a bond market crash that we're looking at.
But this is severe volatility. And what the Bank of England was stepping in to do today was to prevent what they're concerned about in terms of future
market instability. So I think this is a key point that we should be making a course of condemnation. I think he's a brilliant way of saying it. And
that's exactly what we're seeing at this moment.
And I think the Bank of England wouldn't be arguing at this at this juncture that they're providing a role as a market maker of last resort,
and they've put a limit a date limit on what you and I see as QE. But I think they would argue it's limited and therefore not QE in on when the
sense that we've seen it before. The question is, and it goes to everything you just said, do Investors, do consumers, does the British public believe
them or the government over what policy they're choosing here?
And that's my next question, Anna what next? What does the government choose to do? And how likely is a U turn on these decisions over tax cuts?
STEWART: I mean, it feels like the world is calling out for U turn whether it's former policymakers at the Bank of England, whether it's U.S.
government officials, whether it's economist, whether it's the market, whether it's the public, it seems like the whole world at this stage is
calling out at least for some sort of delay in the implementation perhaps of some of the tax cuts.
So far, the government seems to be fairly resolute that they will continue plowing ahead with this plan. We just had a tweet from the Treasury. The
Chancellor continues to make lots of meetings trying to reassure people about the plan; we can bring you what he's said. It said that he met with
members of the financial services sector that was this morning.
He really reiterated the government's commitment to fiscal sustainability. How the medium term fiscal plan to be published on the 23rd of November was
set out a fully - plan to get debt falling in the medium term, IE there's nothing new. But the IMF has made clear they would like to see these plans
re thought by November 23.
IMF suspect you would question the timeline for that November 23, is pretty long way away. And we're talking about financial stability. And we got to
talk about investor confidence and how much damage has been done, just in the last week.
Less than a week, the plan was released only on Friday. Great note from credit rating agency Moody's yesterday, which actually talked about how
this could permanently weaken debt affordability, and the U.K. credit profile, just looking at the sustained confidence shock that we're seeing
really reverberate through global markets, Julia.
CHATTERLEY: Yes, you raise all the right questions, in my mind. How the chancellor maintained his posts without a U turn here, I think is a good
question we'll be asking. I'll be posing to Mohamed El-Erian in around 10 minutes' time. Anna, great job, thank you Anna Stewart there!
Now a potentially devastating hurricane is closing in on Florida's west coast. Hurricane Ian is a category four storm and it's quickly gaining
strength in is already bringing high winds extremely heavy rain and life threatening storm surge flooding. More than 2.5 million people are now
under some level of Evacuation warning.
Carlos Suarez joins us live now from Tampa, Florida. Carlos, great to have you with us just explain precisely where you are for an international
audience what you've already seen this morning and what you're expecting?
CARLOS SUAREZ, CNN CORRESPONDENT: Julia, good morning. We are in Tampa, Florida that is just north of where hurricane Ian is expected to make
landfall later this afternoon as a powerful category four or five hurricane right now. Over 100,000 people across the state of Florida are without
power because of the storm.
A quarter of those outages we're being told are down in southwest Florida because that is why that is where hurricane Ian right now. It's starting to
make its way inland. Here in Tampa, Florida, we are expecting some serious flooding brought on by all of the rain as well as all of that water being
pushed in from the Gulf of Mexico.
[09:15:00]
SUAREZ: This is how one of the bays out here looks like right now. It's pretty shallow in part because we've got low tide. But as the rain moves
in, and as all of that water gets pushed in from the Gulf of Mexico, we can expect this type of water level to rise. Over 390,000 people have been told
that they need to evacuate in the Tampa area.
43 hurricane shelters have been open for the past 48 hours. And emergency officials this morning had told everyone if you live in one of these
evacuation zones, you still have a little bit of time of getting out. But the window really isn't narrowing.
There is somewhat of a sigh of relief in this part of the state of Florida because the storm ended up tracking a little bit further south of where we
are, if that storm had held and it made a direct impact in the Tampa Bay area, we would have seen a storm surge here of anywhere between 5 to 10
feet. That being said further south, those conditions are going to make a mess of that part of the state of Florida.
A few minutes ago, we also got word of a 4-mile bridge that connects a part of the Tampa Bay area. We're told that bridge has been closed down cars
cannot get onto it anymore because the winds out here are now north of 40 miles an hour.
Julia, this is expected to last the entire day. Just how much rain we get in one particular part of town is going to depend on how long it takes for
the storm to get out into the central part of Florida. And even when it does that the Orlando area, the Jacksonville area of those parts of Florida
is also expected to get several inches of rain. Here locally, the forecast is calling anywhere between 15 to 20 inches of rain when everything is said
and done, Julia.
CHATTERLEY: Thoughts with everyone involved and Carlos, great to have you with us and stay safer place in Tampa, Florida. OK, straight ahead more on
the Bank of England's bond buying spree Mohamed El-Erian weighs in as the Central Bank tries to steady the ship plus. We're back after this stay with
us.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to "First Move", the Bank of England now intervening to buy longer dated government bonds on "Whatever scale is
necessary to restore orderly market conditions". The hope is that buying bonds will help support prices of those bonds and bring yields down The
move comes after the IMF and Moody's, the rating agency criticized the U.K. government's plans to cut taxes saying it would increase inflation and
inequality in the country.
[09:20:00]
CHATTERLEY: The pound jumped first against the dollar following the announcement now sliding a further 1 percent versus the U.S. dollar into
the red 1.0616. The level as you can see there.
Joining us now, Mohamed El-Erian, the President of Queens College at Cambridge University and Advisor to Allianz and Gramercy Mohamed, always
great to get you on the show! I want to get your reaction to what the Bank of England is doing? But I also just want to take a step back. And for you
to help my audience understand how unprecedented it is what we're seeing a warning from the IMF, central bank intervention, disorderly currency
movements record rises in in bond yield for a G7 nation, how unprecedented is this?
MOHAMED EL-ERIAN, ADVISER, ALLIANZ AND GRAMERCY: Is incredibly unusual, you would expect the combination you just cited to appear in a struggling
developing country with weak institutions and policymakers that lack confidence. It is happening in the G7 economy. So this is historic Julia, I
mean, this is going to be written about for a long time.
CHATTERLEY: This is a clear crisis of confidence in decisions made by a U.K. government in terms of fiscal policy. Do you also see in it tackles
the moves, perhaps that we've seen today, a crisis of confidence in the Bank of England too.
EL-ERIAN: So if you step back, there were issues already in major transitions. The first transition was away from what I call the la-la land
of Central Banks, that lasted too long, where Central Banks kept interest rates way too low, kept on injecting liquidity and now had to unwind all
this because inflation became a problem.
Then we have a second transition going on, which is in global growth, growth is slowing around the world, and governments are pressed to do
something about it. Now comes the catalyst of a government trying to do too much the government could have gotten away with it had a focus just on the
structural reforms to promote growth, and on the energy price stabilization.
But they went too far in giving indications of very large unfunded tax cut. And that was just a trigger to the mess we're seeing now that I fear Julia,
is going to create a lot of damage, and once again, is the most vulnerable segments of the population that are most at risk.
CHATTERLEY: Explain what you mean by damage? And we'll come back to the Bank of England and to your point what they have to do now, which
exacerbates a slowdown that's already taking place in the U.K. economy? But explain what, what further damage you fear?
EL-ERIAN: So before the latest policy announcement, the average business, the average household had to deal with two things, high inflation, the cost
of living crisis. And second concerns about future income, the recession worry.
Now, we've had a complete destabilization of borrowing costs. To give you an example, the damage has been created, almost a third of the mortgage
products that were available last Thursday are no longer available today, they're no longer offered. And if you are lucky enough to get a mortgage
today, you're paying 20 to 25 percent more than you would have paid a week ago so now we have to deal with significant dislocation in lending markets
and then to the extent that you had wealth in the financial markets that's been hit.
So the concern now is if you have these all these things coming together, that are going to go counter to the government's objectives of higher
growth and low inflation. And, again, the situation wasn't great to begin with. Now, the problems have been amplified.
CHATTERLEY: Sir to go back to our point about restoring some degree of stability. Is the Bank of England saying look, to whatever extent is
required, we're going to buy longer dated bonds, we're going to try and force bond yields down particularly to your point, as you were saying about
the high cost of mortgages in particular. Do you think that's enough? Or do you think between now and the next meeting even they have to hike frontend
interest rates in order to show they're in control, or at least trying to get back in control?
EL-ERIAN: So what they've done is abandoned, and the band aid may stop the bleeding, but the infection and the bleeding will get worse if they don't
do more.
[09:25:00]
EL-ERIAN: I just posted something on the Financial Times. And I set out the five things that need to be done and that doable. They start with the
government postponing the tax cuts. The government explaining better how growth will look to your allies, the Bank of England, as you say, hiking
before November 3rd and emergency meeting hiking by at least 100 basis points, much greater focus on financial stability among the non-banks and
finally, protecting EVE in a more targeted way, the most vulnerable segments of our population, it's doable, the window is there. But if they
wait too long, that window is going to close.
CHATTERLEY: I was just writing those down the 5 points in going through your article as well, which I'll tweet out as well. It began there with a U
turn from the government. That has to be the first step. The chancellor has to come out and say, we got it wrong. We can't do this. We're sorry.
EL-ERIAN: Yes, it does. And politically, that's really difficult. But economically and financially, that's what's needed.
CHATTERLEY: Do you think the Chancellor can remain in his post without that U turn.
EL-ERIAN: I mean that's a political judgment. You know, if the band aid doesn't stick, and it won't stick to be clear, if the other thing is don't
happen, this band aid will not stick. And the way it won't stick is the following.
The currency will start weakening even more that will make international investors nervous, they'll push yields back up. And then the Bank of
England will have a really difficult situation. How do you balance monetary policy and Financial Stability Policy? They are in contradiction right now.
So there's an inherent contradiction in what they're trying to do. That's why it's nothing more than a bad date.
CHATTERLEY: Which is exactly what the IMF warned? Is you can't have fiscal policy that contravenes the efforts trying to be made by the monetary
policy authorities to dampen down inflation. You mentioned the point about a one percentage point or 100 basis points hike in interest rates.
Hang no, it's virtually impossible to gauge. But I'm just wondering about the longer term damage that's already been done by this. Do you even have a
perception of how much more is required in terms of interest rate hikes by the Bank of England to compensate above and beyond what they would have had
to do anyway, to get inflation under control?
EL-ERIAN: A lot more, compared to where we were Thursday, the Bank of England is going to have to be even more hawkish than it would have been
otherwise. And that's the irony is that a program that was designed to promote economic growth and to contain inflation has ended up being
stagflationary, and it's going to force an even greater response from the Bank of England and the Chief Economist of the Bank of England said it
yesterday, when he said, it's now undeniable that monetary policy is going to have to be tightened.
CHATTERLEY: I wanted to broaden it out Mohamed and just get your view on what we're seeing in terms of the weakness that we're seeing in U.S.
stocks, in many ways. And you've been talking about this for many months now. There's a credibility gap in the United States as well fears that the
Federal Reserve isn't on top of inflation concerns about spending in whatever form the U.S. government as well.
And I saw the latest amount of Bank of America data and it sees a lot of money being pulled out of bond funds and equity funds and being put into
cash. There's real warning signals, even with the pullback that we've seen in stocks have a fear of further turbulence to come. What's your gauge, in
terms of the broader credibility gap that we see at this moment? And what it means for risk assets?
EL-ERIAN: It's a real problem, policymakers should be dampening volatility, policymakers lacking credibility, which is the case with the Fed, which is
the case with fiscal policy in the U.K., amplify volatility. So already, we were on a bumpy journey to a different destination, economically,
financially. And now we have additional turbulence in that bumpy journey, coming from the policymakers whose role is not to create an even more
challenging journey. It is problematic. And unfortunately, it's difficult to reverse.
CHATTERLEY: Yes, and for now, to your point. I think, if we bring it back to what we're seeing in stocks, part of this is an inability to understand
what rate hikes are required to get inflation under control and what the impact in terms of growth or recession risk is and finding that balance
point to understand where fair value is near impossible at this stage. Do you think there's more downside for U.S. stocks aggregate - here?
[09:30:00]
EL-ERIAN: I feel so, it's interesting that the immediate reaction of U.S. stocks was favorable because people said, well, if that's happening in the
UK, it means that the U.S., the Federal Reserve is not going to be able to hike interest rates as much.
So expectation of rate hikes came down, yields came down, and stocks went up. I think that's the inherent optimism of the stock markets. I think that
if you have a close look at this situation, you should be more worried rather than less worried. This is again, a g7 economy that is behaving like
a developing country. And that has implications for the system as a whole.
CHATTERLEY: Final question, Mohamed, how concerned are you about financial instability, whether it's stress on pension funds, stress on hedge
positions and options position in the UK market? This sort of ripples of concern that you hear how concerned are you?
EL-ERIAN: I am yes, you and I have discussed, you know, the good news has been that the risk in the banking system has been reduced, consequentially.
So we don't worry about the banks. And that's important, because the banks are the nerve center of the financial system.
But the risk didn't disappear.
It morphed and migrated to what's called the non-banks, the pension funds, the asset managers, the hedge funds. And what we're seeing now is that
there was excessive risk taking there. There wasn't enough supervision of non-banks, something that you and I have been talking about for years.
CHATTERLEY: A long time.
EL-ERIAN: And I think that that's what triggered the Bank of England's response. It's the concern about financial stability. But it's a very
general response to what's probably a very specific problem.
CHATTERLEY: And more is required, Mohamed always great to chat to you sir, thank you for your wisdom Mohamed El-Erian there.
EL-ERIAN: Thank you.
CHATTERLEY: Well "First Move" after this.
(COMMERCIAL BREAK)
[09:35:00]
CHATTERLEY: Welcome back to "First Move". And a quick look at what we're seeing in terms of price action on Wall Street for U.S. stocks tilting. As
you can see, to the downside that reprieve that Mohamed El-Erian was talking about earlier in the belief that perhaps the uncertainty in the
volatility in the UK will limit the amount of rate hikes that the Federal Reserve can do in the United States.
That hope not lasting very long as you can see the NASDAQ the underperformer here down by some four tenths of 1 percent five minutes or
so into this session. It was attempting of course, Wall Street to snap a six day losing streak not looking good these early signs.
Shares of Apple also falling after reports that the company canceled a plan to boost production of new iPhones in the second half of this year
meanwhile, Biogen surging after its Alzheimer's drug slowed the rate of cognitive decline in a key clinical trial. Wow, that stock up some 40
percent in early trade today.
Now returning to one of our top stories and the damaged Nord Stream gas pipeline and CNN is hearing the United States warned European allies that
the pipeline could face threats and even be attacked. That's according to two people familiar with the matter, but it wasn't clear when the attacks
would happen or who would be behind it.
Kylie Atwood joins us now from the State Department in Washington. I could give you a few guesses, but I think they would hone down to very few Kylie,
what more do we know? And when was this warning provided?
KYLIE ATWOOD, CNN U.S SECURITY CORRESPONDENT: Yes, we know that it was shared with European allies, including Germany over the summer. And as you
said, it was a warning that these Nord Stream Pipelines could face threats. They could even face attacks like we are seeing the possibility of
occurring this week.
And we should note that was based on U.S. intelligence assessments, according to sources, familiar with the matter, but not many details as to
exactly what that underlying intelligence said.
CHATTERLEY: Kylie, thank you very much for that report, Kylie Atwood there! OK, let's turn to what's happening now inside Ukraine and Kyiv is making
progress in its counter offensive in the East.
CNN visited a town newly liberated by Ukrainian forces. And as our Ben Wedeman reports, retreating Russians are leaving behind far more than just
military equipment. A warning this report contains disturbing video.
(BEGIN VIDEOTAPE)
BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice over): The bodies of dead Russian soldiers are scattered around the town of Pisky-
Radkivski killed far from home and what the Kremlin chooses to call a special military operation. But it's a war by any other name, a war into
which many more Russians will be thrown now that the so called partial mobilization has begun and who may well meet a similar end.
WEDEMAN (on camera): This is a bank document found on one of the soldiers, the soldier is from St. Petersburg, and he was born on the 30th of
September 2001. He died three days before his birthday.
WEDEMAN (voice over): A charred remnants of Russian armor scattered around town. Outgoing artillery pursues an army once considered one of the most
powerful on Earth. An army that abandoned tanks of plenty many in working order.
Dmitry and his crew are tinkering with one such tank fresh from the battlefield. It has minimal breakage he says, I can turn it on now without
any problems. Sure enough, it's motor roars to life. When they run away they lose not only the tanks says - but also the ammunition and the next
stage it's all used against them.
This tank is almost ready to go back into action. Pisky-Radkivski lies just North of the Donbas region, which after sham referendum President Vladimir
Putin plans to annex to Russia. Yet few here have fond memories of life under Russia's sway.
Stanislav (ph) is cutting sheet metal to put over the shattered windows of his sister's home. There was looting in spring he recalls, they were taking
everything. Down the road Varvara (ph) and Raisa (ph) back to what they did throughout the Russian occupation. Just sitting here, he says Varvara. They
didn't bother us.
But Raisia found them annoying. Nazis, Nazis she says, they always ask where the Nazis? Russians have left or like dead in the dirt, lives wasted
or nothing Ben Wedeman CNN, Pisky-Radkivski, Eastern Ukraine.
(END VIDEOTAPE)
[09:40:00]
CHATTERLEY: OK, coming up here on "First Move" the latest only wrong as protests continue over the death of 22 year old Mahsa Amini. That's next,
stay with CNN.
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CHATTERLEY: Welcome back. Protests are still taking place on the streets of Iran, some 11 nights since they began. Social media video is showing
demonstrations across several cities this week. That's despite a crackdown and of course those ongoing internet restrictions.
They were triggered by the death of Mahsa Amini, a 22 year old woman who died on September 16 after her arrest by the country's morality police.
Jomana Karadsheh is joining us now from Istanbul.
Jomana its astonishing, actually, that we're still seeing these videos of protests 11 days after they began despite the authorities attempts to
suppress them. What more are you gleaning despite the blackout?
JOMANA KARADSHEH, CNN CORRESPONDENT: It's quite remarkable, Julia. As you mentioned nearly two weeks and despite the government using lethal force at
times, shooting at protesters and that's according to the United Nations Human Rights Office. People are still going out on the streets.
You have a mounting death toll right now according to state media and not state media saying at least 41 people have been killed. But we've had
different casualty figures coming in from different organizations, including human rights groups that put it close to almost 80 people killed
so far, and there's a lot of concern.
It's far worse than that. But they seem pretty determined in the face of force and in the face of this government crackdown to still go out and
still demand change.
(BEGIN VIDEOTAPE)
KARADSHEH (voice over): Nightfall in Iran brings protesters back onto the streets. And your total internet blackout by the government is making it
hard for us to know what's really going on.
Video trickling out appears to show many Iranians undeterred by a government crackdown, the threat of arrest or the bullets. It almost feels
like Iran has been a never ending cycle of protests over the past two decades. But those who know the country say everything about this time is
different.
TRITA PARSI, EXECUTIVE VICE PRESIDENT, QUINCY INSTITUTE: This time around very quickly almost from the outset. They start a challenging not the
policies of the Islamic Republic, but the very structures of it. It's also different in looking at the demographics.
[09:45:00]
PARSI: These are primarily very, very young people a younger generation, who have apparently completely lost faith that this Islamic Republic can be
reformed.
KARADSHEH (voice over): And on the streets there have been daring calls for regime change. This video from the City of Mashhad, the birthplace of the
Supreme Leader, shows protesters setting fire to the statue of a man considered one of the symbols of the Islamic revolution.
On Monday, this group marched through the Capitol Tehran chanting against Ayatollah Ali Khamenei. But it is the powerful act of defiance by Iranian
women that have stunned the world.
As protests enter their second week, they're still out on the street, still demanding their freedoms, their rights lost with the 1979 Islamic
revolution. The Iranian government rallied its supporters in mass demonstrations, calling the protests a foreign plot the work of a handful
of mercenary's rioters who forcefully remove the headscarf of women on the streets.
But in reality, the country wide protests were sparked by outrage even among government supporters over the death of Mahsa Amini in morality
police custody. The protests appear leaderless and spontaneous.
PARSI: The frustrations were so significant, it was brewing, but they needed a spark in the spark was that this is not something that came from
the outside. This is not something that was cooked up from the outside. And that's why they were taken so by surprise.
KARADSHEH (voice over): While many Iranians outside the country are holding on to their hope that this wave of protests may bring change. Experts say
the regime is far from collapsing.
PARSI: I don't think they are about to fall, because we have not yet seen the full scale of their reaction. Unfortunately, I fear that we will see a
lot of bloodshed before all of this is over.
KARADSHEH (voice over): Its full force may crush these protests. But it won't be the end for a generation of Iranians, more emboldened than ever.
(END VIDEOTAPE)
KARADSHEH: And Julia, yesterday we heard the Iranian foreign minister speaking with NPR in an interview, he again dismissed these protests as
something that is orchestrated and organized by certain groups.
And he described this as, "not a big deal". And he said he wants to reassure his western counterparts that the regime is going nowhere that
there will be no regime change in Iran.
But experts who know Iran very well Julia are saying, look, unless this regime changes its ways, unless it meets the protesters halfway unless we
see some reforms, this is going to keep on happening. We're going to see more protests for years to come and probably bolder demands from the
protesters on the street.
CHATTERLEY: Yes, if not now, again, and later. Jomana Karadsheh, thank you so much for that report there. OK, still to come. We continue to track
Hurricane Ian, it's a category four storm gained strength and of course, millions of people are in its path, more after this break.
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[09:50:00]
CHATTERLEY: Welcome back to "First Move". Hurricane Ian quickly gaining strength as it moves closer to Florida's west coast. Hurricane Ian is
already hitting Key West, Florida with major flooding.
The Tampa International Airport has closed this morning, the last flight out departed late on Tuesday afternoon before the airport suspended
operations. More than two and a half million people are now under some level of evacuation warning in Chiapas.
Joins us now Chad, I always wonder with the number of people that are under those evacuation warnings, how many people actually choose to leave and how
many stay? But just walk us through what we're expecting in the coming hours and what the path looks like at this moment?
CHAD MYERS, CNN METEOROLOGIST: Yes, Julia, I don't have a number of what the evacuation numbers are, you know, I would say 90 to 95 percent. But
this storm may be higher; we are going to have a storm surge, like they had on Tacloban.
You know, I mean that surge we just pushed up into Tacloban from the super typhoon; we are going to have a surge of six meters. And this surge is
going to overrun and wash away homes that are only one meter above sea level, thousands of those homes are only one meter above sea level.
It's a nice little home sitting on a canal with your little boat in the back that you go out into the Gulf of Mexico and go fishing or sailing
whatever you want to do. But one meter compared to six meters that means there's five meters above their grass. And that's going to be above their
home.
And that water is going to be moving and the winds going to be blowing at 250 kilometers per hour. So we're looking at a super typhoon hitting the
west coast of Florida, where over 8 million people are under hurricane warnings. Now the storm will eventually lose some power.
But it's that water, you have to run from the water, you can kind of hide from the wind, but you have to run from the water 12 to 18 feet in U.S. six
meters. That's just so much.
And so many populated areas are going to see that type of rain wind surge, and even the - today for some tornadoes. Here you go. I'm going to - I can
convert this for you back here, about 110 miles per hour winds.
So you're going to look at 110 miles per hour all the way from the west coast all most to Orlando where Disney World is and then back down here.
The amount of tree damage, wind damage, power lines down, power outages will be tremendous across parts of Florida.
I don't think anybody's ever seen anything like this. We've had big storms in the past. But we haven't had storms that just sit in the water for so
long. 20 inches, somewhere in the ballpark of 600 millimeters of rain will fall in the next 48 hours. And that's not even where they're going to get
the surge from the saltwater. That's a freshwater flood. There's so much going on here.
Tornado Watch in effect as well, which means some of these storms could have little water spouts as they come off shore off the water and onto
land. So there's a lot to this. There are so many disasters going to happen from here.
CHATTERLEY: There's a reason we're calling this potential for catastrophic flooding Chad. And then to your earlier point, we pray that everybody
evacuate and get somewhere safer as soon as they can before it's too late, Chad, thank you for that.
MYERS: You're welcome.
CHATTERLEY: OK, now on to another major storm on the other side of the world. A powerful typhoon in Vietnam is bringing catastrophic winds and
heavy rain and forcing hundreds of thousands of people from their homes. It's one of the most powerful storms to hit Vietnam in 20 years. Paula
Hancocks has all the details.
PAULA HANCOCKS, CNN CORRESPONDENT: It was early Wednesday morning that Typhoon Noru made landfall in Vietnam, the coastal area of denying resort
area, also an historic city of Hanoi being hit quite hard.
It was the equivalent of a high end category two hurricane when it made landfall, and it did have winds of near 175 kilometers per hour, that's
about 109 miles per hour.
Now we have been seeing the aftermath of that particular area, we can see there has been some flooding also, some roads closed either by downed trees
or downed electricity pylons.
Now there had been time to prepare for this. They had known that there was going to be a significant typhoon coming and so hundreds of thousands of
people had been evacuated from those areas expected to be the hardest hit.
And also almost 60,000 ships were put into a port, a sheltered area because it's not just the prevention of loss of life that officials were looking
for but also the prevention of loss of livelihood.
[09:55:00]
HANCOCKS: Now the prime minister had held an emergency meeting just the day before to put these plans in place. He said "Climate change is becoming
increasingly extreme and unusual".
Now this particular typhoon over the next day or two is expected to dump a lot of rain potential flooding in other areas of Vietnam, then also into
Laos and Thailand, but weakening as it goes.
It's also the same typhoon that hit the Philippines just on Sunday making its first landfall there. And just a couple of days before it had a rapid
intensification over a sudden period of time, which took some experts by surprise, but it did make landfall as a super typhoon, before weakening
significantly.
At this point, we understand eight people lost their lives in the Philippines, according to officials, and five are still missing. Paula
Hancocks, CNN Seoul.
CHATTERLEY: And we pay for everyone's safety there too. That's it for the show. We'll continue to track the path of Hurricane Ian throughout
programming today, stay with CNN.
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