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First Move with Julia Chatterley
U.S. Adds a Weaker than Expected 187,000 Jobs in July; Verdict Expected in Alexey Navalny "Extremism" Trial; O'Donnell: AWS Numbers Show Business is Growing; U.S. Adds a Weaker than Expected 187,000 Jobs in July; Lebanon Marks 3D Anniversary with Day of Mourning; Attorneys: Battery Charges Dropped Against Cardi B. Aired 9-10a ET
Aired August 04, 2023 - 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)
ZAIN ASHER, CNN HOST, FIRST MOVE: A warm welcome to "First Move". I'm Zain Asher in for Julia Chatterley. Just ahead on the program reaction to the
third criminal indictment of Former U.S. President Donald Trump plus Black Sea blasts new video showing what appears to be a damaged Russian warship
hit by Ukrainian drones.
Ukrainian sources telling CNN Ukrainian Navy and its secret service are behind the attack on a Russian naval base. And I report for you just ahead
plus, Navalny in court, the Russian opposition leader expected to be sentenced this hour on extremism charges, a fresh conviction and what many
are calling a politically motivated legal assault by Moscow on Navalny.
And here in the U.S. an important new looks on the health of the U.S. jobs market. We just got these numbers about half an hour or so ago showing that
the U.S. added about 187,000 new jobs in July that's below the 200,000 jobs that had been expected.
U.S. unemployment meantime ticking lower to three and a half percent for hourly earnings coming in stronger than expected, Wall Street reaction to
the positive U.S. Futures now firmly higher tech stocks set to rise for the first time since Monday chocolate up to strong gains for Amazon pre market.
The tech giant set to rise more than 8 percent in early trading on blockbuster earning results, its best on earnings beaten years, but another
quarter of weaker shells, pressuring Apple expert analysis on the Mega tech results later on the program as well but first, a closer look at today's
U.S. jobs report.
I want to bring in Mark Zandi, Chief Economist at Moody's Analytics. So Mark, 200,000 jobs that was what was expected 180 -- 187,000 jobs added? Is
it a sign that the fed's actions are working, just walk us through it break down the numbers for us.
MARK ZANDI, CHIEF ECONOMIST AT MOODY'S ANALYTICS: Indeed Zain, I think the numbers were about as good as they get right down the fairway as they would
say, you know, a couple 100,000 shows that the job market remains very resilient, strong, recruiting lots of jobs, but growth is moderating,
slowing, just like the Federal Reserve would like to see.
And everything is headed in the right direction here. Wage growth is a little strong for the Feds liking. You know, obviously, they're focused on
inflation and want to get that back in the bottle. But even there, I think we're -- all the trend lines look pretty good. So you know it's about as
good a report as one could ask for.
ASHER: So is the Fed going to be more focused when they sort of assess these results? Are they were more focused on the wage growth number coming
in at about 0.4 percent for the month? Or are they going to be more focused on the broad sort of 187,000 jobs added, which as you point out, is
certainly trending in the right direction?
ZANDI: Yes, I think all of the above. I mean, I think they like to see the job growth numbers moderate, because that's key to easing up the labor
market and taking some of the pressure off, and ultimately getting that wage growth number down.
But you know wage growth is critical to inflationary pressures, particularly in the service side of the economy, which is very labor
intensive. And we need wage growth to moderate a bit more to be consistent with underlying productivity growth to be consistent with the feds 2
percent target.
I know I'm saying a lot there. But, you know, it's not quite where they want to see it, but it is moving in the right direction. And my sense is if
job growth continues to moderate like it has, we will see those kinds of wage growth numbers that the Fed wants to see. And I don't think most
importantly, I don't think any of what I just said requires any more rate hikes by the Fed.
ASHER: And when it comes to the potential of a recession later on this year, I mean, several months ago, a lot of economists were anticipating
some kind of a recession, even if it was just a mild one that seems to have changed now. You know, what are you expecting just in terms of the Fed
managing to pull off the soft landing, which is what they had hoped for?
ZANDI: Yes, I think you're going to pull it off, you know, float that all along. I mean, it's tricky. You got a they have to raise rates, interest
rates high enough, fast enough to slow things down and quell that inflation.
But not too high, too fast to undermine the economy, kind of thread the needle here, so to speak. And they've been threading the needle, you know,
we are getting inflation is coming in here pretty quickly. It's not back to target yet, but it's getting there pretty quickly.
And they're doing that without any increase in unemployment. You mentioned the 3.5 percent unemployment rate. That's about as low as it gets. And, you
know, Zain, it's been there now for I think, well over a year, so just incredible. They're pulling this off.
ASHER: They've actually managed to thread that needle as you point out. And in terms of Fitch downgrading U.S. debt, the U.S. losing its AAA rating I
mean just walk us through as to whether or not in the grand scheme of things yes its big headlines. But does it really matter? Do you think?
[09:05:00]
ZANDI: No, no, I don't think it matters at all. I mean, I think if you ask any global investor that buys bonds, you know which bonds they'd like to
own if push comes to shove, and things are going off the rails and the global economy or even here in the U.S. they'll say, a U.S. Treasury bond
that is the AAA credit on the planet.
Global investors know that. And, you know, that's reflected in our interest rates. You know, the, the U.S. is the reserve currency, countries have
invested trillions of dollars in U.S. Treasury bonds, because they know, when they're in a pinch, the Treasury bond is the safest place to be. So,
you know, it's AAA.
ASHER: And last question, I mean, just in terms of the sort of muted reaction we saw this time, compared to the relatively more significant
reaction we saw back in 2011. Why the difference here when it comes to downgrading debt?
ZANDI: Well, I think, you know, back in 2011, that were after a very dramatic debt limit, increased battle. And that was something we had never
seen before. That was really brand new, at least in terms of the vitriol and the brinkmanship.
And I think just investors were very nervous at that time. And the S&P downgrade just added to those concerns. This go around, you know, we got by
the debt limit, actually, the drama this last summer was more benign than I think people feared.
And, you know, at the end of the day, the U.S. economy is doing quite well. It's the most dynamic economy on the planet, big economy on the planet.
It's driving the train. And I think people feel comfortable that you know, when push comes to shove, you know, U.S. policymakers will address our long
term fiscal issues.
ASHER: Right, Mark Zandi live for us there, appreciate it Chief Economist at Moody's Analytics. Enjoy your weekend.
ZANDI: Thank you.
ASHER: All right, Former U.S. President Donald Trump is back at his golf resort after pleading not guilty to four felony counts in the alleged plot
to reverse his 2020 election loss but the indictment isn't slowing his campaign for a second time.
The former leader plans to attend a campaign fundraiser in Alabama tonight and another event in South Carolina on Saturday. His next hearing is set
for August 28th when the judge is expected to set a trial date. Justice Department prosecutors want to move things along quite quickly but Trump's
legal team is looking to delay the trial until after the 2024 election. Katelyn Polantz has the details.
KATELYN POLANTZ, CNN SENIOR CRIME AND JUSTICE REPORTER: Donald Trump has pleaded not guilty for the third time in a criminal case, this time facing
charges in Washington D.C. so he came to the federal courthouse behind me on Thursday afternoon for this initial appearance before a magistrate
judge.
And Donald Trump was in court personally with three of his lawyers as well as the Special Counsel himself, Jack Smith, and other prosecutors from his
office. So in court today, Trump was there sitting and he was addressed directly by the judge.
He was asked several questions about understanding his rights understanding what was happening, he was even asked what he was pleading to the charges
that he faces. There are four of them, largely conspiracies related to the 2020 election disenfranchising people's votes, obstructing the
congressional proceeding, defrauding the United States government.
And he said, in these words, not guilty, that's how he said it. And so Trump before the judge, he also had to speak directly to her to assert that
he understood that it was his right to remain silent. He didn't need if you spoke to any federal investigators, it could be used against him in court,
and he acknowledged that he understood that he also acknowledged that he understood that it would be a crime while he's out on bail, to intimidate
witnesses or potential jurors in this case.
And so that was something that the judge made sure he understood. So this was one of those proceedings. That was quite procedural. But quite a moment
for this courthouse, a courthouse that is right across the street from the U.S. Capitol building where the riot on January sixth took place.
And also a courthouse where many of the judges here have handled Special Investigations around Donald Trump previously, have handled the criminal
cases and sentenced his former campaign staffers to jail.
And then also this is a court that has heard hundreds of Capitol riots cases with many of those people being sentenced to jail time and these
punishments, sometimes being quite harsh for what happened on that day.
So Trump himself in court was really a moment that many people wanted to observe, including seven judges on the bench here, the Chief Judge himself
was in the courtroom, even though he wasn't presiding. The next hearing is going to be on August 28th.
That's going to be before the judge that will oversee this case to trial. And the issue teed up before her is when will the trial date be? The big
question there specifically because the Justice Department wants to go to trial as fast as they can.
[09:10:00]
And Donald Trump's team in court today already, were saying they want to see how large the evidence bulk is in this case because they want to make
sure they have a fair trial and want to be able to take their time going through it. Katelyn Polantz, CNN Washington.
ASHER: Indictment against Donald Trump says he deceived the public however, new CNN poll shows that most Republicans apparently still believe him. The
poll shows 69 percent of Republicans and Republican leaning independents believe Joe Biden's 20 win was actually not legitimate and start from
earlier this year.
Overall 61 percent of Americans say yes, Biden did win fair and square that 38 percent believe that he did not win fair and square. Our poll shows
President Biden's approval rating is at 41 percent about on par with where it's been since the spring.
All right a drone attack on a Russian naval base. This video here apparently shows a sea drone approaching a Russian warship before crashing
into it. Ukrainian source telling CNN the vessel was seriously damaged. The Russian military claims it repelled the attack at the Black Sea Port CNN's
Nick Paton Walsh has more.
NICK PATON WALSH, CNN CHIEF INTERNATIONAL SECURITY CORRESPONDENT: It's yet another sign of the vulnerability of parts of Russia's military
establishment that must have considered themselves frankly impregnable Novorossiysk Black Sea Ports where images show a Ukrainian it seems
overwater drone approaching the -- boats where Ukraine says potentially hundred Russian personnel were at the time of an explosion caused by just
short of half a metric ton of TNT just a massive force of a blast.
Now, clearly a military target hit there. A sign by Ukraine that they can hit parts of Russia that were thought far out of their reach this possibly
hundreds of miles traveled by a Ukrainian drone and also to indications that perhaps an oil storage facility had failed to see a kind of on the
other side of that gulf may have been hit as well.
Ukrainian officials simply suggesting that that target was indeed inevitable at some point. But exactly what I think Vladimir Putin does not
want to see right now after a similar underwater drone attack on the Kerch Bridge, recently the key infrastructure connecting Russia's mainland to the
Crimean Peninsula that they annexed in 2014 after attacks on Moscow.
The drone attacks on the Kremlin, exactly a sign of Russia's increasing vulnerability inside its motherland during this war dragging on, the
counter offensive in the south raging certainly but these attacks shows that the war is going far from to plan for Russia back to you.
ASHER: Any minute now, we are expecting a verdict in the latest trial involving one of the Kremlin's fiercest critics. Alexey Navalny is accused
of supporting extremism charges that he calls politically motivated.
Russian opposition leader is already serving more than 11 years in a maximum security prison east of Moscow and this new verdict could extend
his time behind bars by an additional two decades. Ahead of the trial Navalny said that he is prepared for what he called a Stalinist sentence.
Nic Robertson joins us now. When we do get this verdict, it will certainly come at a time of intensified suppression of dissent in Russia, especially
given the war in Ukraine. Nic, walk us through it.
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yes, Navalny is at the pinnacle, if you will, of the criticism, the political opposition to Putin
before the war, you know, he was poisoned three years ago, which by the FSB, at the behest of President Putin, apparently, and this was intended to
kill him. So Putin has been out to try to silence him for a long time.
So a 20 year sentence in a remote and extremely harsh penal colony in Russia is another version of trying to silence Navalny has been facing
terribly harsh conditions in jail has been kept awake at night denied reading material denied writing material.
He believes that he has been infected with cold as well has been in the jail, his visibly when we see appearances in courtrooms. He has visibly
lost weight. His family says that this is really essentially a physical punishment.
He has been kept in confinement, way more than most other prisoners would be as all trade -- it's all been trying so far to break his spirit and
break his will but it hasn't done that so far. And I think it was very telling his the trial just a month ago that lead which was in the lead up
to their sentence.
He said you know if a new, richer country is to be born they basically have to be people who are willing to suffer and pay the price to do that.
[09:15:00]
And he is indicating that he's one of those the charges specifically that is facing today a promotion of terrorism funding extremism, rehabilitating,
Nazism these entire he completely denies. But it's very clear the Russian State President Putin wants Navalny as far away from his supporters and as
silenced as possible.
ASHER: Yes, and as you point out is certainly about breaking Navalny's spirit, but it's also about sending a very clear message of intimidation to
other would be dissidents, as well. Nic Robertson, we have to leave it there. Thank you so much. Appreciate it.
All right, straight ahead. Two major tech giants reporting very different results in the second quarter Tech Analyst Bob O'Donnell joins me to
discuss Apple and Amazon's very different earnings next.
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ASHER: Welcome back to "First Move". The world's most valuable company saw its revenue slip again in the last quarter. Apple said revenue fell 1
percent to $81.8 billion. That is the third consecutive year over year quarterly revenue drop, the April to June quarter is typically the slowest
of the year for the tech giant, which usually unveils new iPhone.
In the autumn meantime, another tech giant saw its sales boom. Thanks to strong demand on a wide range of products. Amazon sales grew 11 percent in
the second quarter sending its stock soaring in after-hours trading it. Joining me live now is Bob O'Donnell. He's the President and Founder and
Chief Analyst of Tech Analysis Research.
Bob, thank you so much for being with us. I want to start with Apple declining demands clearly for consumer products for Apple here is a
prolonged period of a sales slump since 2016. Just walk us through what jumped out to you in these earnings numbers?
BOB O'DONNELL, FOUNDER AND CHIEF ANALYST, TECH ANALYSIS RESEARCH: Well, there are a couple of things Zain. I mean, the biggest factor is that this
is proving that Apple is not immune to the overall macroeconomic conditions that we've seen a lot of the tech hardware company's face and exactly to
that point.
The other thing to remember is that really the business that was hurt at Apple was the hardware business mostly iPhone, Mac, iPad, things like that
watches actually did a little bit better, but it's a smaller category compared to the rest.
And so there are a couple of things going on. Some of this is still frankly hangover from the pandemic. A lot of people updated devices during the
pandemic.
[09:20:00]
The other thing is people are not updating especially smartphones nearly as much. The worldwide smartphone market is down and continues to be down.
And so what we're seeing is Apple taking its share of the hit to the overall smartphone market. So on the opposite side, their services business
is what continues to shine for them. And you know, the beauty of the Apple ecosystem is, once you get an Apple device of some kind of being a phone,
or a PC, or a Mac, or an iPod.
Then they hooked you in with their services to Apple TV, Apple Music, all the other services that they have. And that's what's been building and
growing for them. So as long as they continue to sell devices out there and build that install base, which they said was now over 2 billion. That's a
lot of people to sell services too.
ASHER: Right, yes. So just in terms of emerging markets, and when you think about you point out that they did well in services, but of course, the
hardware market is tough. A lot of people have greater during the pandemic, and they've held on to those devices. When it comes to the emerging
markets, China did better than expected.
But the real sort of Holy Grail for them the future, when it comes to emerging markets is India, that is a huge opportunity for Apple. How did
they capitalize on that?
O'DONNELL: Yes know, and that's exactly right. And you know, the interesting thing about the iPhone numbers, while they were not good,
obviously, they weren't as bad as they could have been. Because the China numbers were much better than a lot of people expected.
And they started to talk about India, now, India is coming from an extraordinarily small base for them, because the Indian phone market is
extraordinarily price sensitive, and of course, Apples at the ultra-premium side of things. So I think with India, there's going to be a couple of
things to bear in mind.
Number one is Apple does continue to sell a full range of products. Remember, not everybody buys the iPhone 14 some people are buying the older
versions that Apple is selling at a lower price. And I think we'll see more of that in markets like India. The other thing is attach rate on services
in some of the other developing countries is also lower.
So it's going to be a little bit harder, China attach rate on services has been OK. But again, nothing like it is in the U.S. and Europe. And in
India, I think it's going to be even lower. So there's certainly a lot of opportunity. And a lot of those markets, it's just about getting the
hardware out there first.
But they've got to get a couple of years of building up that installed base. And then they can start to do more of the content, local content,
obviously, for them in terms of like Indian content, TV, etcetera, etcetera, to really drive that forward.
ASHER: And just one quick question on another hardware product that they recently announced the Apple vision Pro, that's their virtual reality
headset that retails at something ridiculous like $3,500. I mean, who is that the future? Just in terms of, you know Apple hardware products? Can
you really see it taking off with a price point like that?
O'DONNELL: No, it's not going to, and I actually got a chance to try it, I was at the launch event, and I was one of the few people that got to try
it. And its look, it's a great product, but it's a great virtual reality product. And I emphasize that because VR has been around for a long time,
we've had Meta.
We've had bunch of other companies, and it's never gone to the mainstream. So even at a lower price point, my concern is that notion of really getting
fully encompassed with this thing wrapped around your head is not something a lot of people want to do.
And so I think it's going to be a long time before we see vision Pro, get to the point evolved as a product and a price point to make it mainstream.
So specifically, no, I think it's going to be a while it's going to be an interesting distraction for a while to be honest. But it's not going to
make a significant revenue hit for them for quite some time.
ASHER: Yes, because I mean, who's the target audience? Let's talk about Amazon revenue coming in at $6.7 billion in the second quarter, net income,
excuse me, $6.7 billion in the second quarter. Part of the reason is that they saved a lot of time and money on deliveries. And also, you know, their
cash cow does continue to be Amazon Web Services. Walk us through that.
O'DONNELL: Yes, exactly. And, you know there were a lot of eyes on the tech industry as a whole and Amazon in particular, and AWS in particular,
particular, to see what was going on in terms of what's the momentum in the tech market and so for AWS to come out with really good numbers.
I said a lot. It said that, hey, first of all, their business is growing. We saw that Microsoft's as your business was still growing, all the cloud
guys are growing to be clear, Microsoft, Google as well as Amazon, but that the fact that AWS continues to grow as large as they are mean, their growth
rates are down sure.
But look, this is law of big numbers. When you're that big, you can't grow at 25 percent a quarter or you know, year over year, every single time it's
going to slow down, and that's what's starting to hit but it did grow, which means companies are continuing to invest and that's really, really
important.
[09:25:00]
And of course, that's where a lot of their profit's come from as well the other good sign from Amazon for an overall macro-economic story is the fact
that retail the online purchases went way back up, both in the U.S. and internationally. So again, that's a good sign that there's a little bit
more confidence amongst consumers to buying goods.
And so it's, you know, I think it's setting up the company very well. And I think, again, it sets this nice tone moving forward for overall tech that,
hey, a lot of the worst is now past, and we can start moving forward. And I think that's really important for a lot of people. And then that's how
that's being interpreted.
ASHER: And Prime Day numbers, if I understand it correctly, we didn't see Prime Day numbers in the second quarter that will show up in the next
quarter, right? What are we expecting? I mean, they had record numbers this year, actually.
O'DONNELL: They did. So again, yes, the Q3 results should be obviously buoyed by what they did on Prime Day. And again, you know, now that we know
how Q2 did from a sales perspective then you throw in the prime numbers on top of that, again, a good sign in terms of where people are thinking how
that market is moving and how they're feeling about online purchasing.
And, again, I think that's important moving forward. The other thing to bear in mind one last thing on Amazon is, you know, they start talking more
seriously about generative AI, of course, the hot topic of the tech world.
ASHER: Right.
O'DONNELL: And they've done some things in the last quarter as well to position themselves now that we know companies are continuing to invest in
the cloud. They're just starting to invest in generative AI and AWS has got some nice new capabilities, as well as the ability to work with others,
which is going to be important in this world. And so that's also a good sign for them moving forward.
ASHER: Yes, it hasn't translated into faster gains yet, in terms of AWS. But you know the future is certainly promising Bob O'Donnell, President,
Founder and Chief Analyst of Tech Analysis Research, thank you so much.
O'DONNELL: Thank you.
ASHER: And we have much more "First Move", after the break.
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ASHER: Alright, welcome back to "First Move". That is the opening bell ringing on Wall Street. I'm not sure if we can actually hear it there. U.S.
stocks up and running this frantic Friday for investors. Another big jobs Friday too by the way, as we've been reporting, the U.S. economy added
weaker than expected 187,000 jobs last month.
Mark Zandi of Moody's Analytics told us earlier that he believes jobs growth has moderated enough to allow the Fed to halt its rate hike
campaign. U.S. stocks reaction to today's number. Certainly higher, much appreciated bounce after a rough start to August trade stocks pressured
earlier in the week by rising bond yields.
After that surprise U.S. credit downgrade by Fitch also watching trading in two NASDAQ heavyweights, Apple and Amazon a strong bounce in earliest
trading for Amazon after its big earnings beat its strongest quarter in years, Apple falling on disappointing revenue outlook.
Apple however, reporting strong growth in its services division, as well as strength in China market moving news coming in fast and furious this week.
It has been a busy week, and who better to break it all down for us than. Our resident expert, Richard Quest, who joins us live now.
So, Richard, of course, what the Fed has been looking for quite a while in terms of jobs, especially is a broad sort of cooling in numbers, is that
what we're seeing here? Is Jerome Powell going to be happy with this particular report?
RICHARD QUEST, CNN BUSINESS EDITOR-AT-LARGE: Yes, I think he is, because it is showing not only in the instant month of July, but in the revisions of
May and June, that the number of jobs being created is slowing down. They're still being created, but just not at the same higher levels.
And when you look at the revisions of the last few months, and you look at the lower number for July, it is painting a picture of an economy gradually
slow, because let's face it, when an economy slows, fewer jobs are created. I know it's sort of a perversion, that bad news is good news.
But actually fewer jobs means the economy is slowing. And that probably means at least by these numbers, that the feds medicine is working.
ASHER: OK, so then he's happy with this report, as you point out, what does he do with information, especially when it comes to when or whether or how
to pause interest rates?
QUEST: Yes, I think you've got two parts to that equation. The first, do you raise rates more? The answer is probably no. On the basis of this
number, although there is a component here about the amount of average hourly earnings, which was a bit higher than they will be happy with.
But the bit that doesn't change, Zain, is you stay higher for longer. And that's the bit so you may not raise rates more, but you're certainly going
to keep them at these elevated levels for longer than you normally would. And that's also going to continue to slow the economy. We also saw, for
example, numbers only if we get into the plumbing of the financial system.
We saw, for instance, that the banking crisis earlier this year, the banking crisis means that tighter lending, that in itself is slowing the
economy. So there are a variety of forces, all of which are doing Jerome Powell's work, which means he probably doesn't need to raise rates, maybe
once but probably not even that.
ASHER: I never when you look at as you point out the plumbing looking at the plumbing of this particular jobs report.
QUEST: Yes.
ASHER: Wage growth numbers, right? Wage growth numbers, he's not going to be too pleased with that 0.4 percent rising over the month, what is Jerome
Powell make of that?
QUEST: With that this is the fear. The fear is that you're embedding inflation through wage spirals, higher inflation, higher wage raise claims,
higher wages, higher inflation, but you can break that. And the way you break it is with a cooling jobs market. And the moment you have a cooling
jobs market.
So PEEP workers just can't ask for the extra money because there are more workers available now that we're not there yet. So there is still some
concern, there will be at this higher hourly rate. But remember what I said you don't need to raise rates much more if at all. You just keep them
higher for longer and that has the same effect.
[09:35:00]
ASHER: So you just keep them steady.
QUEST: Yes.
ASHER: So in terms of market reaction, can you guys can we put what the DOW is doing right now, last time when we just started trading about five
minutes or so ago? So up about 100 of your points or so basically more or less flat-ish, what do you think the market makes of the jobs report?
QUEST: No, I think the market is saying we're very pleased with it. I think the market is saying elites initially, wait until we digest further, that
things are looking better than we had hoped, at this point, when in a bad number would have meant higher rates, you've only got to look at the U.K.
to see just how desperate things can get.
In the same way that we're talking about the lowering of the U.S. credit rating, the Bank of England raise rates for the 14th consecutive month, and
anybody who's got a U.K. mortgage has seen it more than double. So you're seeing and arguably the Bank of England has not finished yet.
So we are seeing different economies responding in different ways. The U.K. is still in deep trouble, the euro zone is probably climbing out marginally
better. But the U.S. to use the analogy is the cleanest dirty shirt in the moment. The cleanest dirty shirt and this morning's number confirm it.
ASHER: Right, because Jerome Powell has to thread this needle very carefully, just in terms of ensuring that you can engineer a sort of soft
landing and creating a fleet of pre-recession. He wants to have a soft landing that he wants to be doing that somewhat right.
QUEST: Right, and to be blunt, to be honest, monetary policy through interest rates is an incredibly blunt instrument. I mean, there's no fight
on a day to day basis it's a fine scalpel of monetary movements and on overnight deposits. But on long term rates, it is literally the bludgeon of
interest rates.
It is not sophisticated. It is not how you operated. It's not nuanced. And you get to these moments where we are now where frankly, you just look
you're trying to tune a Swiss clock with a sledgehammer.
ASHER: OK, I love your analogies, Richard, certainly wakes me up this time of the morning. Our Request Quest is live for us there. Thank you so much.
All right back to one of our top stories is our how a growing number of indictments could impact Donald Trump's third run at the U.S. presidency.
The Former President is heading to campaign events in Alabama and South Carolina over the weekend after pleading not guilty to four federal charges
over the alleged plot to reverse his 2020 election loss. Alayna Treene joins us live now. So in terms of what happens next.
The next court appearance is set forth late August, which is shortly after the first presidential debate. Just walk us through how that impacts the
next race for U.S. President?
ALAYNA TREENE, CNN REPORTER: Right, well, this is something that's very much weighing on Donald Trump and his team's mind. And it's the argument
that they're making as part of their defense, which is that these court appearances and these legal battles that, he is having to face right now
are interfering with his presidential campaign.
And that's also part of why they showed up in person yesterday for their court appearance, they wanted to show that he's being taken off the
campaign trail in order to appear in Washington D.C. yesterday, but then again, later this summer to deal with his legal troubles.
And so I think it's interesting to see I mean, in the short term, we have been seeing Donald Trump's standing in the polls go up. And he's benefiting
from these at least with his Republican voters and people in his base. They are choosing to support him even more in rallying around him in light of
the charges.
They also did this with the past two indictments that he's facing. But a big problem that I know the Former President and his team recognize is how
could this impact him as he gets closer to the 2024 race and also, if he is able to win the Republican nomination? Of course, we are far away from
that.
But how will his court battles play in regard to wanting to win a general election? And so this is very much weighing heavily on Donald Trump and his
team. And I just want to share as well, Julia, that in light of everything we've been seeing this week with this most recent indictment.
The Former President is very angry. He's very frustrated by this. He's arguing that yes, yes, we've taken off the trail to participate in some of
this, but also a lot of the money that his political action committee has been raising money that should be spent on advertising and helping him pay
for rallies.
[09:40:00]
It is now needing to be redirected to his legal team and it's something that's really angered him and so I think you're going to continue to see
Donald Trump be defiant, be angry and frustrated show that online you're seeing him post on truth social today, echoing that kind of rhetoric.
I think you're going to continue to see that over this weekend both today in Alabama and on Saturday in South Carolina, Julia.
ASHER: Yes, just in terms of you know how much worse this gets for him. We're seeing barricades being erected outside the Fulton County courthouse
in Georgia. So who knows when we're going to see an indictment in that particular case, it could be very soon.
Alayna Treene, live for us there. Thank you so much. Right to U.S. Navy sailors arrested for allegedly sending sensitive military information to
Chinese Intelligence Officers.
(BEGIN VIDEO CLIP)
MATTHEW OLSEN, U.S. JUSTICE DEPARTMENT ASSISTANT GENERAL FOR NATIONAL SECURITY: The charges demonstrate the PRC is determination to obtain
information that is critical to our national defense by any means. So it can be used to their advantage.
The alleged conduct also represents a violation of the solemn obligation of members of our military to defend our country to safeguard our secrets and
to protect their fellow service members.
(END VIDEO CLIP)
ASHER: Natasha Bertrand is live for us at the Pentagon with details. So what evidence did prosecutors have what are they saying?
NATASHA BERTRAND, CNN NATIONAL SECURITY REPORTER: Yes, so prosecutors unveiled two indictments yesterday against two U.S. sailors who have
separate cases here, but they are much related. Essentially, what prosecutors are alleging is that one of these U.S. Navy sailors who was
working at Naval Base, San Diego Jinchao Wei.
He was essentially an engineer working on U.S. Navy ships, as well as the USS Essex. And what happened was in February of 2022, he apparently began
an asset handler relationship according to the indictment with a Chinese Intelligence Officer. And he started providing this officer with images of
the U USS Essex as well as other Navy ships, including photos of their layouts and the weapon systems on the ships themselves.
And in exchange according to the indictment, he received thousands of dollars from this Chinese Intelligence Officer. Now in the other case,
which again is related but separate from the first one another U.S. Navy sailor, he apparently was communicating with the Chinese Intelligence
Officer between 2021 and 2023.
And he was an electrician, but essentially, he fixed electrical equipment at U.S. military facilities around the world. And he began providing this
intelligence officer according to the indictment, with photos of U.S. radar systems in Okinawa, Japan as well as other information related to U.S.
military exercises in the Indo-Pacific.
And an exchange, prosecutors say he received about $15,000 from this Chinese Intelligence Officer. Now, way who was the first defendant here, he
pleaded not guilty yesterday according to prosecutors. We still don't know how the second defendant here is going to plead.
But this is just an example, according to the U.S. government of how far China is willing to go to try to steal U.S. military secrets from U.S.
service members apparently targeting U.S. Navy sailors in an attempt to gain military advantages that they can then use to pursue, of course their
own national security interests.
And so what the U.S. is saying here is that look, this is very, very concerning not only, of course, that China would target these individuals,
but also that these U.S. service members allegedly would provide this information to them. And we should note that the U.S. military is still
reeling from charges filed earlier this year against another U.S. service member who allegedly mishandled classified information by simply posting it
on the internet.
So this is at least the third time this year that U.S. service members have faced charges related to the mishandling of classified and sensitive
national security information.
ASHER: Alright, Natasha Bertrand is live for us. Thank you so much. All right, still to come here on "First Move", Lebanon marks three years since
the port explosion that shook Beirut and killed hundreds we'll have the details next.
(COMMERCIAL BREAK)
[09:45:00]
ASHER: Alright today marks the third anniversary of the devastating explosion that level parts of Beirut, Lebanon in 2020. A day of mourning
has been declared for the more than 200 victims who died and the thousands more who are hurt. The blast originated in a warehouse full of ammonium
nitrate that had been improperly stored for many years.
The shockwave was one of the biggest non-nuclear explosions ever recorded to date. No official investigation into the cause has been completed.
Tamara Qiblawi joins us live now. Tamara, so much anger, so much pain because there has been no justice for the victims and really no
accountability. Walk us through.
TAMARA QIBLAWI, CNN SENIOR DIGITAL MIDDLE EASE PRODUCER: Absolutely. You know, three years on we are none the wiser. If anything, there are more
questions about the port explosion than there are answers at the moment. You see people pouring into the streets of Beirut, not only to mourn their
dad, not only to commemorate this terrible tragedy.
But also to demonstrate against what has been essentially a stunning obstruction of justice orchestrated by Lebanese political elite, many of
whom have been prosecuted in an investigation into the port explosion. Now, that investigation has more or less been frozen because of repeated legal
petitions against this the current investigating judge which is of course fueled anger on the streets.
However, it's really important to note that people, the relatives of the deceased, leading lawyers, members of civil society are now planning to
take their pursuit of justice elsewhere. There is an overwhelming demand on the streets in the media. Among these leading figures for a U.N. fact
finding mission increasingly, they are calling upon the international community to intervene.
But as it stands, yes, it frozen investigation, more questions than there are answers. We still don't know what caused the port explosion. We know
that the ammonium nitrate was exploded. We know that they were improperly stored. We know that corruption was a major culprit in this however, the
specifics are incredibly elusive.
And as you will see from the streets of Beirut, the wounds are raw. Relatives of the deceased are still teary eyed. But we are none the wiser.
And there are real questions as to where the pursuit of justice goes from here, Zain.
ASHER: Yes, and I mean, when you think about it, I mean, three years. I mean, it probably feels like yesterday for a lot of the family members of
the victim's just so much emotional pain, so much just in terms of psychological harm for a lot of people who lived through that.
We'll see what happens in terms of the pursuit of justice. Tamara Qiblawi, live for us there. Thank you so much.
[09:50:00]
Alright still to come after the break. The Pope is in Portugal tens of thousands turn out to catch a glimpse of the pontiff that story, next.
(COMMERCIAL BREAK)
ASHER: Pope Francis is visiting Portugal this week for a while the Youth Day and international gathering for Catholic young people. Lisbon police
says half a million people came out for the Pope's address on Thursday, CNN's Antonia Mortensen was there and she sent us this report.
ANTONIA MORTENSEN, CNN SENIOR PRODUCER: Pope Francis officially kicked off World Youth Day in front of huge crowd on Thursday. Organizers say 350,000
people registered to be here in Lisbon. His messages to the unfaithful don't be afraid to stir things up. Take care of the planet and be aware of
the pitfalls of online addiction.
Catholic -- have traveled here from all over the world for this event, which is held every three years in a different location and is dubbed as
the Catholic Woodstock. And it really does feel like a festival with live music and lots of singing and dancing around us not only here in this farm,
but in the whole city.
The Pope started his day by meeting and praying privately with 15 Ukrainians who traveled to Portugal for this event. He then met with
students and staff of Lisbon's Catholic University. And during that speech, he urged young people to keep seeking and to be ready to take risks in a
world which faces enormous challenges.
The five day trip is taking place in the shadow of clerical abuse scandal here. Earlier this year, a report published by an independent commission
found that some of the Catholic clergy in poor school had abused thousands of children over a 70 year period. On Wednesday evening, the Pope did meet
privately with 13 victims of clerical abuse.
The Vatican described it as a time of intense listening, and during an address he said that the Catholic Church needs to do better when dealing
with victims of clerical abuse, saying that the church is in need of humble and ongoing purification and must listen to the anguished cry of the
victim.
Despite his recent surgery and struggles of mobility, the Pope has an intense schedule with some 11 speeches during his trip and more events than
in the past trips this year, including a trip to the country's popular shrine of Fatima. The 86 year old pontiff wasn't very good form on the
papal flight from Rome's Fiumicino airport.
And he joked with journalists saying he would come back from this trip rejuvenated. Antonia Mortensen, CNN, Lisbon.
ASHER: Alright and entertainment news. It seems rapper Cardi B is off the hook and will not face battery charges after her concert in Las Vegas last
weekend.
[09:55:00]
She was under police investigation for this moment while throwing a microphone into the crowd it was obviously apparent retaliation after the
concert goer sprayed her with a drink while she was on stage. Cardi B's attorneys say police notify them she would face no charges based on the
department's investigation.
CNN has reached out to Las Vegas Police for comment. And finally here on "First Move", the singer Lizzo is speaking out about a lawsuit filed this
week against her and her production company. Three of her former dancers alleged they were subjected to a hostile work environment.
One says that she was harassed about her weights and other said Lizzo pressured them to touch nude performers at a club in Amsterdam. Lizzo is
calling the allegations sensationalized posting on Instagram "I know what it feels like to be body shamed, and I would absolutely never criticize or
terminate an employee because of their wage and she added I am hurt.
But I will not let the good work I've done in the world be overshadowed by this." In a CNN interview, one of the dancers says that she was
disheartened by Lizzo's response, and called it incredibly frustrating. CNN has reached out to representative for Lizzo and her company big girl, big
touring Inc., sitting with a company for comment on the complaint.
Alright everyone that is it for the show. "Connect the World" is up next. I'll be back with you in about two hours from now.
(COMMERCIAL BREAK)
END
