LOU DOBBS MONEYLINE
Attorney General Warns of Further Terrorist Attacks; Wall Street Sees Sharp Sell-Off
Aired October 29, 2001 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANNOUNCER: This is MONEYLINE for Monday, October 29.
LOU DOBBS, CNN ANCHOR: Good evening -- as you've just heard, Attorney General John Ashcroft saying the government has credible information of a possible terrorist attack on U.S. targets within the next week. The attorney general says U.S. officials do not know where that attack might happen. We'll go live to the White House in just a moment.
Anthrax today discovered at additional government agencies in the nation's capital -- anthrax causing the Supreme Court justices to convene outside their courtroom for the first time in more than 65 years -- U.S. jets today targeting Taliban troops facing off against opposition forces near the capital of Kabul.
Boeing's stock today plunged after losing a gargantuan contract to Lockheed Martin Friday -- and chip stocks pushing the Nasdaq lower after Intel cut chip prices. And a deal that would make EchoStar Communications the nation's leading home satellite television service provider is met by skepticism today on Wall Street.
In the war against terrorism, Taliban fighters are being attacked from the air and the ground tonight: U.S. jets dropping bombs from the skies, while Northern Alliance forces are exchanging heavy fire across enemy lines.
The Pentagon today said the Taliban and al Qaeda network are responsible for any civilian casualties in Afghanistan.
(BEGIN VIDEO CLIP)
DONALD RUMSFELD, SECRETARY OF DEFENSE: The responsibility for every single casualty in this war, be they innocent Afghans or innocent Americans, rest at the feet of Taliban and al Qaeda. Their leaderships are the ones that are hiding in mosques and using Afghan civilians as human shields by placing their armor and artillery in close proximity to civilians, schools, hospitals and the like.
(END VIDEO CLIP)
DOBBS; The defense secretary says a number of al Qaeda and Taliban soldiers, including their leaders, have been killed in those bombing raids. In New York City today, a U.S. House Intelligence Subcommittee heard testimony on terrorism and homeland defense -- Mayor Rudolph Giuliani, among a number of New York officials who testified -- the mayor calling for greater information-sharing between the FBI and state and local authorities.
Attorney General John Ashcroft, as we reported, has issued a new alert to all Americans concerning the possibility of a terrorist attack within the nation's borders within the next week.
John King, who broke the story earlier, joins us now from the White House with the latest -- John.
JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: Lou, that dramatic announcement from the attorney general and the FBI director just moments ago based on what John Ashcroft says is new and credible information, intelligence data, raising the possibility of terrorist strikes here in the United States or against U.S. interests overseas.
Again, as you noted, the information not specific as to the target or to the method of those possible attacks -- but Mr. Ashcroft saying he decided it was urgent to make that public after notifying 18,000 law enforcement agencies around the country. Those -- that work went on behind the scenes this afternoon. Then Mr. Ashcroft came into the briefing room at the Justice Department to make his public announcement.
(BEGIN VIDEO CLIP)
JOHN ASHCROFT, ATTORNEY GENERAL: The administration has concluded, based on information developed, that there may be additional terrorist attacks within the United States and against United States interests over the next week.
(END VIDEO CLIP)
KING: The attorney general saying he decided to go public with this because the American people might encounter more security precautions as they go about their daily business from state and local law enforcement officials -- Mr. Ashcroft, also saying, as the president did earlier in the day, that individual Americans might be able to break up terrorist activities by noting any suspicious activity around them.
And, as the attorney general made that announcement in public, Lou, we know the White House chief of staff, Andy Card, calling key members of Congress, Tom Ridge the new director of homeland security, here at the White House, calling governors around the country, asking them to do all they can to raise the alert status, already quite high, of state and local law enforcement officials as well -- Lou.
DOBBS: John, I know the attorney general would not respond to the difference and the credibility of these two alerts, this the second alert after the previous alert in which the cases of anthrax attacks followed. But this seems a bit peculiar to issue an alert without a credible threat, a sense of approach on the part of the terrorists' timing or place. What is going on here?
KING: Well, we were told in advance of this announcement -- when we first reported this development, several senior administration officials telling us, yes, the information was not specific as to a time or method of an attack. But they believe -- and it was corroborated by other sources -- that it was credible -- U.S. officials deciding that they had a responsibility to put it before the public, even though, as you noted, it could cause some jitters. But we do know there's an unprecedented surveillance operation going on around the world: U.S. and other intelligence services monitoring the bin Laden network.
One senior administration official I talked to before this announcement was made said it was a tough call, but the president believes it was the right call, because they view this information to be both credible and timely.
DOBBS: OK, John, thank you very much -- John King from the White House.
Well, two new cases of anthrax confirmed this evening: A 51- year-old New Jersey woman who lives near the Hamilton Township mail facility tested positive for skin anthrax. And a second postal worker at the Hamilton mail center has now been confirmed to have inhaled anthrax.
In Washington, traces of the bacteria were discovered in the mailroom of the Supreme Court building. But weekend tests showed the rest of that building to be clear. The nine justices were forced to convene outside the high court for the first time since 1935.
Small amounts of anthrax were also found in mailrooms at the State Department headquarters, and a mail pouch bound for the U.S. embassy in Peru. Last Thursday, a State Department mail handler was diagnosed with inhalation anthrax.
The president is vowing to tighten immigration policy to stop terrorists from entering the United States. New steps include checking to make certain people entering the United States on student visas actually attend school. Many of the 19 terrorist hijackers on September 11 were in the United States on visas typically given only to students.
Firefighters who were on the scene right after the World Trade Center collapsed are now being checked for respiratory problems, that after a growing number of New York firefighters contracted what's being called the World Trade Center cough.
For more on this, we're joined now by Dr. Sanjay Gupta.
Doctor, good to have you with us.
SANJAY GUPTA, CNN MEDICAL CORRESPONDENT: Good evening, Lou.
DOBBS: The screening is taking place. Do we have us any evidence of what might be the problem? GUPTA: Well, what we're talking about, Lou, is the evidence of smoke injury as well as small-particle-disease injury on the lungs. Certainly, we saw large plumes of smoke -- hard to forget those.
Combined in that smoke was small particles that actually can get into the lungs, get to the very base of the lungs, and sometimes cause difficulty with getting oxygen from the lungs into the blood. That's the difficulty here, Lou.
I talked to the doctor, the chief lung doctor for the New York Fire Department. He said up to 40 percent, about 4,000 people are having chronic cough, but cough so severe that it is requiring steroid inhalants. The concern is that sometimes that can go on to become asthma. Sometimes it can go on to become emphysema, pulmonary disease, things like that.
So far, only 370 have been screened. Lou, they're going to screen close to 11,000 over the next 60 days, about 170 or so a day.
DOBBS: Doctor, there's no issue here of concern about some sort of chemical -- biochemical weapon being involved then?
GUPTA: That's correct. There is not a concern. The EPA has monitored the air consistently throughout that time. People also talked about asbestos, Lou. That was also checked and also found to be very, very low in conservation.
DOBBS: Now, the important question is: What can be done for these firefighters and policemen who were there? And as anyone who was near there in the days following -- in point of fact, the weeks following -- knows the dust and the air were just filled with debris. What can be done for these people?
GUPTA: Well, the big goal here, Lou -- and a lot of those folks have inflammation of their airways because of the irritation of the smoke and the small particles. The real key is to try and decrease the inflammation. That's where steroids come into play. If you can decrease the inflammation early on, sometimes you can prevent the disease from progressing and hopefully prevent it from becoming a long-term problem.
We don't know that this is a syndrome yet. We don't know if this is going to be a long-term problem. Right now, they are being checked and being treated for any airway problems.
DOBBS: OK, Dr. Sanjay Gupta, thank you very much for being with us.
GUPTA: Thank you, Lou.
DOBBS: New traces of anthrax have been found in mailrooms at two government agencies in our nation's capital: the State Department and the Supreme Court testing positive for anthrax.
Meanwhile, Manhattan's largest mail distribution center is open, despite testing positive for anthrax last week. However, late this afternoon, a New York postal workers' union filed an environmental lawsuit seeking the closure of that facility for further testing.
John Nolan is the deputy postmaster general of the U.S. Postal Service and joins me from Washington, D.C.
Good to have you here.
JOHN NOLAN, DEPUTY POSTMASTER GENERAL: Thank you.
DOBBS: The number of anthrax cases as a result of these attacks is growing -- a lawsuit today because of the facility here in Manhattan that was remaining open during contamination.
What is your reaction to that lawsuit?
NOLAN: Well, I think that, much as the same as the national union, frankly, that now is not the time for lawsuits. Now is the time to work together to find solutions to make sure that people understand what the problems are, understand what we are doing to solve them and work together to resolve all those problems.
The key here is that we're very interested in employee safety and customer safety. And that's what comes first. So I think it's just a matter of understanding what it is we've already done and what the real facts are.
DOBBS: Are you confident that you have the facts? Are you confident that we know enough about this problem to say to the employees of the postal service that you know what's going on?
NOLAN: In the New York Morgan station, we've taken over 160 samples and come up with five samples, five very small samples, in one isolated area on our third floor of that 1.8 million square foot facility.
We were advised to close off a very small area. We closed off a 100,000 foot area and have cleaned the machines. We have tested that facility up and down and provided antibiotics for our employees to make sure, just doubly safe, that there's no problem. So we believe we're doing the right thing and more.
DOBBS: The right thing and more.
At this point, as one looks at the evidence and the performance in this as this country learns more and more about anthrax and these attacks, it is also pretty clear, right now, that we don't know nearly enough -- any of us -- about this, do we?
NOLAN: Well we are learning, obviously, every day.
The postal service, CDC, health authorities throughout the country are learning. But what we're trying to do is to take those precautionary steps beyond what we know now to make sure that we're doing the right thing.
DOBBS: Recognizing the importance of the postal service -- it's important to the lifeblood of this country's economy, it's society.
Isn't it, perhaps, reasonable here to say let's err on the side of caution because you're dealing with 800,000 lives, just in terms of postal employees, and say let's shut this down and be absolutely certain?
Let's make a decision that we're going to put these irradiating machines in every postal facility and tackle the problem straight up -- putting the safety of your employees paramount and the safety of the public paramount.
NOLAN: Well, the fact is that if you shut down a postal facility everywhere in the country and test today, does that make it safe tomorrow? What about the next day?
I've used the line that if you had a traffic accident in Seattle, you wouldn't shut down the highway system in Florida. What you've got to do...
DOBBS: Well this is hardly a traffic accident, Mr. Postmaster General. I mean, I think that analogy -- they always limp. That one is certainly in the category of limping.
I can't see any parallel to a traffic accident in these anthrax attacks, can you?
NOLAN: Well no, but what I am saying is you attack the areas where you know you have a problem. And we're sampling 300 facilities around the country where we have no evidence of any anthrax to just spot check to make sure that we know what we're doing.
DOBBS: In terms of knowing what you're doing, what is happening with the postal service? As I said and as we all know, it is critical to business in this country.
What has been the impact on the mail load in all forms?
NOLAN: Well, mail volume is down during this period from what we would have normally expected, even in a period of economic downturn. So there's no doubt that catalog mailers, not necessarily because of the mail problem, but just because of the whole terrorist threat, are worried about the buying psychology and are holding back shipping out catalogs.
There has been an impact because of the terrorism that's occurred since September 11 as well as the economic downturn. So it's been noticeable.
DOBBS: OK, John Nolan, thank you for being with us. We appreciate it -- John Nolan, deputy postmaster general.
Well a little later here, unprecedented giving over the past six weeks has many smaller charities now starving for donations. We'll take a look at who is being most affected as a result.
But first, we're going turn to Wall Street where today there was a sharp sell-off.
The Dow Jones industrials falling 275 points, losing just about three percent -- nearly 1.1 billion shares of volume today. The activity today remarkable also because this is the 72nd anniversary of the 1929 stock market crash.
Christine Romans joins us now from the New York Stock Exchange, where it was, to say the least, a busy day -- Christine.
CHRISTINE ROMANS, CNN CORRESPONDENT: It was, Lou.
And, in fact, you take a look at this, it was the worst one-day drop in this market since that terrible week of September 17, when the markets reopened.
Analysts tonight are saying it's not any better what we heard from Mr. Ashcroft later today after the bell closed and he worried about the opening bell tomorrow.
Let's take a look at the Dow losers here today. Among them, Boeing a big loser, down 10 percent -- inactive after it lost out on a huge fighter jet contract. GM down about five percent. Also you had United Technologies, Pratt & Whitney winning a $4 billion chunk of that big fighter jet contract. The stock had already priced it in.
3M down sharply here today as well -- folks nervous in general about a lot of these big names. This stock, though, still trading above pre-attack levels.
Lou, overall, people are looking for tomorrow, watching the futures tonight, but still looking weak.
DOBBS: OK, Christine, thank you -- Christine Romans from the New York Exchange.
More now on today's market sell-off. We are joined by Michael Holland, who is chairman of Holland & Company.
Michael, let me ask you at the start -- why the sell-off today? It seemed to have sort of a life of its own without any one principal cause.
MICHAEL HOLLAND, CHAIRMAN, HOLLAND & COMPANY: I think, Lou, the sell-off was caused in large part by what caused the market to go up so as much as did since September 11.
Christine Romans just referred to 3M, for example, as a stock which sold up but it's still above the terrorist attack levels. What's gone on since the terrorist attack has nothing to do with the economy. The economy still stinks. We're in a recession. Earnings still stink as well.
What's happened is we've had a massive vote that says positive things about what Washington has done in response to the terrorist attacks. So there's a vote of confidence. Over the last couple of days, I think the market stepped back and said, you know, we've come a long way where the market has gone and we have a few things that aren't so terrific with respect to Afghanistan. Maybe it's going to take longer and we had...
DOBBS: Despite the fact that the president has been clear from the outset that it's going to take a long time?
Wall Street's reaction to these things is tell me about that tomorrow.
DOBBS: And in terms of this market selling off -- 275 points on the Dow. Boeing...
HOLLAND: Boeing's a big part of that.
DOBBS: ... a significant part of that. The Nasdaq also falling -- slightly higher percentage.
HOLLAND: Four percent.
DOBBS: ... four percent on the day.
Are you are saying, then, that we're just simply adjusting back to pre-September 11 levels?
HOLLAND: We're actually in a pre-September kind of evaluation thing.
In other words, what we have is we have over 1,500 points on the Dow which has occurred since that period of time. We have, I think, a much better sense of where we're going to get some solace in the economy, which is massive fiscal stimulus and monetary stimulus, but it's nowhere to be seen yet.
DOBBS: It strikes me that our viewers and others around the country are watching the attorney general of the United States give a warning about possible terrorist attacks in the course of the week.
We are reporting that the nine justices of the Supreme Court have just moved out of their building for the first time in almost 66 years. And yet, at the same time, we're watching investor confidence remain relatively high. As you've said, we're sitting here -- these markets have moved back after that initial week.
What can we expect here?
HOLLAND: My guess -- short-term -- some erosion of that as we had today. You just -- in addition to all the things you just enumerated as to why people can get nervous -- yes, the postmaster general -- the deputy postmaster general giving you some more reasons with the whole commerce sector of the economy.
What we have right now, I think however, is a steadfastness and a purpose that's going on in Washington that it will not go away. I think we'll have three steps forward, one step back. I think we're in the middle of one step back here. I think we're going to have, by the end of the year, not a bad situation.
DOBBS: And what would you advise investors to do here?
HOLLAND: I would...
DOBBS: We need some solace and some counsel.
HOLLAND: I would only say what I've done. I been around for a long time, actually started almost during the Cuban missile crisis. What I can say is when we have nuclear threat as we did back then, we have amazing resilience here in the United States.
I would have to say over the last 30 years, I am more optimistic about America's prospects right now than I have been at any time. Therefore, I would not be a seller of stocks here, I would actually be on -- moments like we have today, I would be a buyer. Be a little bit weary of bonds, because although we have a little deflationary stuff going on, bonds have come a long way. Yields are quite low.
DOBBS: OK, Michael Holland, as always...
HOLLAND: Good to be here.
DOBBS: Good to have you with us, Michael.
Well coming up, this is the season of giving. Many charities, however, are not receiving the attention they need to survive and to serve those clients that they seek to.
As demand for Cipro is soaring, one major drug company wants to give us anthrax for free -- anthrax treatment rather -- for free. Stay with us.
ANNOUNCER: Coming up, Lou talks to Robert Ingram, president and COO of GlaxoSmithKline.
DOBBS: Bayer today said it wants the government to stick with plans to keep Cipro the drug of choice for the treatment of anthrax. But the government is also asking other companies for a cheaper alternative to help build a national stockpile.
Kitty Pilgrim now takes a look at the side effects on Bayer's blockbuster drug and its troubled bottom line.
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): Have a headache? Take an aspirin. The popularity of that ubiquitous Bayer product has been taken over in these troubled times by another Bayer product: Cipro. Bayer stock has climbed about 21 percent in the last month, as the drug name has been on the lips of every doctor and politician, including the president of the United States -- in business terms, a pharmaceutical home run for Bayer, a needed boost, after Bayer's anti- cholesterol drug, Baycol, had to be withdrawn from the market. But analysts are wary of too much enthusiasm.
SVEN BORHO, ORBIMED ADVISORS: I think that it's definitely an overreaction by investors with regards to the anthrax scare and the jump in Cipro sales. I think the increase -- increases in Cipro sales will be more than offset by the loss of Baycol sales.
PILGRIM: Cipro's patent expires in 2003 and is now the only drug that is labeled as an antidote to anthrax. But the CDC says other medications, such as generic doxycycline, are also a remedies with fewer side effects.
IVAN WALKS, CDC CHIEF HEALTH OFFICER: Doxycycline is just as effective with respect to killing the anthrax. But in addition to that, people can tolerate it. What that means is, we'll get better compliance. Folks will take the medication, as opposed to stopping on their own because it doesn't agree with them.
PILGRIM: Johnson & Johnson has volunteered to donate 100 million pills of its Levaquin, the same kind of antibiotic as Cipro, to the government.
KURT KRUGER, BANC OF AMERICA SECURITIES: It does roughly $1 billion in sales for them a year. And this would, though, require a label, an additional label to be named or called out for anthrax. And the company right now is seeking that label change with the FDA.
PILGRIM: Now, the bottom line is, there is no telling what the ultimate demand will be for Cipro or any other anthrax remedy. And to count on sales of these products to boost bottom lines seems, to many analysts, to be wrong-headed thinking -- Lou.
DOBBS: OK, we are going to explore that subject later here as well. Kitty, thank you very much -- Kitty Pilgrim.
Another drug company is hoping to profit on the anthrax treatment. It is, in a different way, free publicity. Britain's GlaxoSmithKline wants to supply anthrax-fighting antibiotics to the United States for free.
The Food and Drug Administration must, however, first approve those drugs. For more on that, we're joined by the president of GlaxoSmithKline, Robert Ingram.
Good to have you with us.
ROBERT INGRAM, PRESIDENT & COO, GLAXOSMITHKLINE: Thank you, Lou. Nice to be with you. DOBBS: The offer of a treatment of antibiotics for anthrax, that's a remarkably generous gesture. How soon could you make good on it?
INGRAM: Lou, we could make good on that offer as soon as the FDA gives us an approved indication for treating the anthrax bacteria.
DOBBS: How long would that take?
INGRAM: Well, we're in discussions with them now. And we hope that it will occur as soon as possible. As the earlier story said, there are a number of other antibiotics -- the tetracycline class; drugs like ours, Amoxil and Augmentin, both of the penicillin-type class -- that have shown in-vitro to be very effective against killing the bacteria that causes anthrax.
Our promise is simply, if that label is approved, to make sure that we provide those medicines free of charge through the government to people who are infected or exposed to this bacteria.
DOBBS: Well, that is a terrific offer. But, again, I would ask: How soon can you make that available? What is the practical possibility of the FDA getting that approved forthwith?
INGRAM: We hope that it will occur in a short period of time. And we have geared up our production facilities in anticipation that, if it is approved, there would be no delay in supplying those medicines based on demand.
DOBBS: I'll try one more time. A short period of time: Can you put that into some context for us?
INGRAM: Lou, I can't give you an exact time frame. But, you know, we would hope that this would occur in the next few weeks, if not month.
DOBBS: Well, that would be terrific news as well. As they say, the price certainly would be right. The fact that the FDA has not approved these drugs -- and you mentioned a number of them -- does that in any way diminish their effectiveness against anthrax?
INGRAM: Not at...
DOBBS: They are just as effective, are they not?
INGRAM: Not at all.
In fact, you've heard from experts at the Centers for Disease Control and other anti-infective experts that say that all the data that they've seen testing these medicines against the bacteria shows them to be very effective. And in many cases, as was earlier reported, they do so with less severe side effects.
DOBBS: Well, let me ask you this: Why don't you just make it available to the government without the FDA approval, then?
INGRAM: Well, you have to play by the rules, as you know, Lou. And we need, in our business, to make sure that any medicine that we're providing to patients has met the scrutiny and standards of the Food and Drug Administration.
DOBBS: In terms of what the pharmaceutical companies are doing here, not only in the case of the anthrax attacks, but the potential other bioterrorism threats here, are the pharmaceutical companies doing enough? And could you give us an idea of what they are doing?
INGRAM: I'd be pleased to, Lou.
We had a very good meeting last Friday with Secretary Thompson at which company after company went through the various proposals of providing medicines, research scientists, production facilities, all in cooperation with our government to ensure that the research- intensive pharmaceutical industry is doing all that we can to help meet this crisis and this challenge.
Two things came out that meeting. First, the secretary has asked us to put together the leading scientists within our own companies, which we've done. They'll commence meeting with the government, Department of Health and Human Services this week to identify as we go forward the priorities for investment and research, as well as producing the medicines that we need short term.
Secondly, to assure the American public that there is no shortage of antibiotics today -- whether it be ciprofloxacin, tetracyclines or penicillin-type medicines, there's an adequate supply. And our industry is committed to work with the government to make sure that we meet the challenges that we face today.
DOBBS: Robert Ingram, thanks for being with us here on MONEYLINE.
INGRAM: My pleasure.
DOBBS: Well, we have a new warning tonight from Attorney General John Ashcroft. As we've reported, law enforcement agencies have been put on heightened alert. More terrorist attacks could be on the way within the next week. We'll have more for you on that coming up next here.
Also, we'll be telling you about more traces of anthrax found in federal government offices in Washington -- and the Supreme Court and State Department, among the sites -- and, today, a major sell-off on Wall Street. One economist warning we have a long ways to go, before we can talk about recovery.
ANNOUNCER: Next, Lou speaks with Lakshman Achuthan of the Economic Cycle Research Institute.
DOBBS: The budget surplus is shrinking, the government posting a $127 billion surplus for fiscal 2001. That is 46 percent smaller than a year ago. Still, it is the second largest surplus ever. Budget officials today blaming lower personal and corporate income tax receipts on the smaller budget surplus. Joining me now to take a closer look at this economy and its state is MONEYLINE contributor and economist Lakshman Achuthan.
DOBBS: We've watched the budget surplus dwindle. How concerned should we be?
LAKSHMAN ACHUTHAN, ECONOMIC CYCLE RESEARCH INSTITUTE: Well, that's what happens, actually, during recessions. That's what happens.
DOBBS: So we shouldn't be concerned?
ACHUTHAN: Well, I don't think you should be surprised. I think we're -- I think that the nice thing about cycles is as they go down they also will eventually turn up and we hopefully have a long expansion and build up a surplus again.
DOBBS: Some people drawing some confidence from the fact that unemployment remaining relatively stable, at least in the unemployment report for last month. We have a new one coming out. What is it going to it tell us?
ACHUTHAN: It's going move in the wrong direction. I...
DOBBS: What I'm going to ask is, how much is it going to move in the wrong direction?
ACHUTHAN: More than we would ever want, is what I would say. You're going to see a continuation of deterioration in the job market. And that's critical, and a critical negative right now, because consumer confidence is the key to the timing of when all that stimulus will go and get spent. And once consumers feel a little bit more stable about their future, they will spend the stimulus and you will get a strong recovery.
DOBBS: And what's it going to take to bolster that stimulus? We have anthrax attacks. We have the attorney general today talking about more attacks maybe on the way over the course of the next week, issuing more alerts. We have continued cuts, as you pointed out, an economy that is shrinking and it appears for all the world we're in recession. What's it going to take here?
ACHUTHAN: Well, I think it's going to take some time, quite frankly. Job market is where confidence is rooted, and the jobs are going to continue to deteriorate for the next couple of months minimally, as corporate America tries to become profitable.
On top of that, when you have the uncertainty introduced by the terrorist situation, that's an additional negative. If we can get some visibility on either of those fronts -- some sign of a stabilization and of some constructive moves going forward -- then the consumer can spend some of the pent-up stimulus.
DOBBS: And some successes in the war against the Taliban, Al Qaeda and other terrorists.
ACHUTHAN: That's part of it. Definitely.
DOBBS: Okay. Good to have you with us.
ACHUTHAN: All right.
DOBBS: Coming up next here, we'll tell you about a boom in donations to charities who are helping victims of terrorist attacks. But that has created a major problem for other charities. And stocks plunging across the board. We'll have live reports for you from both the New York Stock Exchange and the Nasdaq. Stay with us.
DOBBS: Well, now the latest developments in the war on terrorism. Just less than an hour ago, Attorney General Ashcroft issued another stern warning about potential terrorist attacks.
(BEGIN VIDEO CLIP)
JOHN ASHCROFT, ATTORNEY GENERAL OF THE UNITED STATES: The administration has concluded, based on information developed, that there may be additional terrorist attacks within the United States and against United States interests over the next week.
(END VIDEO CLIP)
DOBBS: The attorney general says the Bush administration views this information as credible, but does not have specific information as to the type of attack or intended targets.
Traces of the anthrax bacteria have been discovered in the mailroom of the Supreme Court building. The nine Justices were forced to convene outside that high court for the first time since 1935.
Small amounts of anthrax also discovered in mail rooms at the State Department headquarters and a mail pouch bound for the U.S. embassy in Peru.
Firefighter who raced to the World Trade Center collapse last month are now being checked for respiratory problems. Health officials say there has been an increase in the number of cases of so- called "World Trade Center cough."
The Office of Emergency Management says there are 4,136 people still missing in the World Trade Center attacks. There have been 519 confirmed deaths. 465 of them have been positively identified.
It was a bitter start to the week on Wall Street: renewed economic fears pushing the markets lower, the Dow plunging 275 points. The Nasdaq, S&P 500 sharply lower as well. We turn now to Christine Romans at the New York Exchange and Greg Clarkin at the Nasdaq Market Site to bring us up to date. Christine, let's begin with you.
ROMANS: Well, Lou, it was a tough day on Wall Street. And you can take some solace in the fact it was only 1.1 billion shares changing hands here. But traders tell me it felt like a good amount of that volume was coming in late on the day as it closed near the lows.
Let me take you through some of the big board losers. Some interesting names on this list. Topping the list Enron. It was very active again today and trading at the lowest price since 1994. Credit worries growing here. Moody's comes out and cuts Enron's senior unsecured debt to just two notches above junk status.
McDonald's -- the Burger Place, Selectron, the contract electronics manufacturer, both warning on their 2002 revenues, both of them down sharply here today.
And Eli Lilly -- it had been strong all session -- the drugmaker giving some good news: conditional FDA approval of its sepsis treatment. But even by the end of the day, some of the safe haven stocks were falling. So nerves here on Wall Street. Folks telling me it's a big dose of reality. These markets have come a long way since the September 21 low, Lou.
DOBBS: Christine, thank you. Christine Romans. And over at the Nasdaq, that index falling four percent on the day. Greg, bring us up to date.
GREG CLARKIN, CNN CORRESPONDENT: Lou, I'll tell you, really no bright spots today. We saw the composite open lower. The losses accelerated throughout the course of trading and finally finishing at the session lows. The low 1700 for the first time since October 19th . It sits right now at 1699.
Here's some of the factors that went into trading today. Intel confirming that it did indeed slash prices on about 10 of its chips over the weekend. That sparked a research note out of Merrill Lynch that says the price meltdown continues in the semiconductor business. There will probably be no price stability, according to Merrill, until some production cuts take place or companies exit the business entirely.
We also had tech downgrades. A.G. Edwards slashing Cisco And Xilinx ratings. And then eBay earnings guidance. The company coming out and saying for the fiscal 2002, they expect earnings 70 to 73 cents a share. 73 cents a share really is what the Street was looking for.
You can see Intel is lower -- eBay a big sell-off on that news. Cisco, Dell Computer lower. All the other big name technology shares finished lower as well, throughout the day. You saw Xilinx shares down $3.32 after that downgrade, closing at just over $30 a share. So at this point, Lou, basically the Nasdaq is back to where it closed on September 10. It's a few points higher than that at 1699.
DOBBS: Greg, thank you very much. Greg Clarkin.
Well, a huge upset in the media industry. EchoStar apparently winning DirecTV from the hands of Rupert Murdoch's News Corp., ending an 18-month battle for the General Motors unit. But that deal faces many obstacles. Regulators are expected to closely scrutinize the $26 billion cash and stock deal. Steve Young has the report.
STEVE YOUNG, CNN CORRESPONDENT (voice-over): If EchoStar's $26 billion purchase of DirecTV goes through, that would create a company with 17 million subscribers: several million more than AT&T Cable, the biggest cable system in the nation.
But the direct broadcast satellite, or DBS, companies want regulators to focus on the fact that even if combined they'd still be small compared with the cable industry's overall 80 percent market share. EchoStar chief Charlie Ergen, who owns 51 percent of his company, would be chairman and CEO of the combined entity.
CHARLES ERGEN, CHAIRMAN AND CEO, ECHOSTAR: It's going to take four to six months to get shareholder votes that are required on the GM and GMH side. The EchoStar shareholders have always -- have already approved this transaction, or at least I have, so -- there's a fairly good shot that this thing will go through on the EchoStar side.
YOUNG: But many antitrust lawyers assign a low probability that regulators will approve, because EchoStar and DirecTV are fierce competitors.
STEPHEN AXINN, AXINN, VETROP & HARKRIDER: Up until today, the dish network -- which is EchoStar -- has been willing to cut price in order to build market share at the expense of Hughes' DirecTV network. And of course, that competition will be eliminated by this merger -- and that won't be lost on the government at all.
YOUNG: EchoStar has hired the man the government used to defeat Microsoft's Bill Gates to make the case that eliminating DBS competition is pro competitive.
DAVID BOIES, ANTITRUST LAWYER, BOIES SCHILLER: It will provide effective, meaningful competition to cable by allowing the direct broadcast suppliers to be more efficient, to offer broadband Internet access, more programming at less cost.
YOUNG: If regulators don't approve, there's a wide suspicion that Rupert Murdoch -- who pulled out of a deal at the last minute -- will be back to pick up the pieces, at a price lower than his last $22.5 billion offer.
DOBBS: It's interesting. This price pre-September 11, holding up here.
YOUNG: Yes, it's interesting indeed.
DOBBS: And the likelihood of regulatory approval?
YOUNG: Well, many people are saying as low as 35 percent chance.
DOBBS: That could explain why both stocks of these two companies fell today. Steve, thanks. Steve Young.
Well, still ahead, a record amount for a single cause, but charities not related to the September 11th relief effort are having a tough time raising money. We'll bring you up to date. We'll be joined by the woman who took the mission to entertain and encourage our troops overseas and has applied the same approach at home. Stay with us.
ANNOUNCER: Next, Lou speaks with Janet Langhart Cohen, First Lady of the USO and founder of the Citizen Patriot Foundation.
DOBBS: Charities raising money for victims and their of September 11th are overwhelmed with donations -- unfortunately, to the detriment, often, of other charitable organizations. Many charities are suffering from a lack of contributions. And with a weakening economy, many fear those contributions will drop further. Susan Lisovicz has our story.
SUSAN LISOVICZ, CNN CORRESPONDENT (voice-over): The Metropolitan Museum of Art says paid admissions are down 25 percent. Habitat for Humanity says September contributions plunged 40 percent below estimates. And Citymeals-on-Wheels, which feeds New York's elderly poor, says the falloff in donations is so bad that it had to cancel a fund-raising event for the first time in 20 years.
MARCIA STEIN, CITYMEALS-ON-WHEELS: There is a whole lot going against us. The stock market has not come back, the direct mail is a problem for us now, with so much concern about opening mail. And our special events don't have the allure they had when people felt like going out in the evening here in New York.
LISOVICZ: September 11th was a watershed event in American philanthropy. On the one hand, seven out of 10 Americans donated time, money or blood to help out cases related to the terrorist attack. But that has hurt giving to other causes, especially with the worsening economy.
Over the past 40 years, annual charitable giving has increased on average by 7.6 percent. In recessions, the average drops by a third.
STACY PALMER, "CHRONICLE OF PHILANTHROPY:" Charities are having a difficult time going to the people that they can usually count on for contributions. Many people have been laid off from their jobs or are worried that they might end up being laid off. And people whose stock portfolios have gone down dramatically in value, they can't give as much as they thought about giving in the past.
LISOVICZ: October is National Breast Cancer Awareness month. Three recent Race for the Cure events had to be postponed. Four were canceled altogether. But organizers say they have noticed a new priority among donors.
SUSAN BRAUN, SUSAN G. KOMEN BREAST CANCER FOUNDATION: People came forward and said, "we want to be a part of something life affirming."
LISOVICZ: Still the breast cancer foundation and other nonprofits are dealing with yet another whammy delivered late last week. The sudden resignation of the president and CEO of the American Red Cross under fire over how the organization spent its money. War, unemployment, anthrax and now a credibility problem, which may weigh heavily on charitable giving during the most important time of the year for fund raising. Lou?
DOBBS: Let's figure out how to turn all of that around. All right. Susan, thanks.
Well, the United Services Organization -- the USO -- has encouraged and entertained our troops overseas since the second world war, with the battle now joined on the home front. The first lady of the USO has established a second group to do the same thing for soldiers and civilians as well working in the United States. Janet Langhart Cohen joins us now from Washington, D.C.. Janet, good to have you with us.
JANET LANGHART COHEN, USO: Nice to be here, Lou, and thanks for having us on.
DOBBS: You -- the name of your organization is the Citizen Patriot Organization?
COHEN: Yes, it's the Citizen Patriot Organization, and it was really born out of the tragic events of 11/9. And of course it was inspired by the wonderful mission of the USO, which is to uplift and enhance the quality of life of our military.
And now that we have two war fronts -- one overseas and one here at home -- I was inspired the expand that mission to the citizens here, to the law enforcement, to our firemen, to the rescue workers and let them know that we the American people, we the citizen patriots, support them as well. And of course...
DOBBS: And your...
COHEN: ...the citizen patriot leaders are right here in our business community. People like Hank Greenberg at AIG, Phil Condit at Boeing. My own industry, television: entertainment tonight went overseas to support the troops and let them know that the American people are behind them.
And interesting thing about that, Lou, is when we were overseas just last Thursday we discovered that while our men and women in the armed forces are on mission to get that justice, they were worried about us here on the home front. DOBBS: And in that trip -- all of that travel and all the expenses paid for not by the government or private contributions, rather by business, right?
COHEN: Yes. I'm glad you made that point. No money was exchanged. And I heard in your previous piece that people want to do something life affirming. Well, they can follow the lead of the citizen patriots in business, because what they did was offer their resources and their time. No money was exchanged.
I have a 92-year-old godmother who bakes cookies and she takes them to the fire department in her neighborhood. You don't have to spend money. I see postal workers. They're on the front now. And I say to them, "Thank you. You're on the front line. Thanks for delivering the mail."
DOBBS: Well, Janet, thank you for being here. And we wish you all the very best.
COHEN: Thank you so much.
DOBBS: Coming up next here, we'll tell you what happens when a corporate leader loses the confidence of employees, of his board and investors. We'll tell you the story of United Airlines next.
And we'll tell you about movie fans flocking to theaters. They went to see tales of ghosts and aliens. Stay with us.
DOBBS: The Argentine markets battered today as fresh signs that the government may not be able to meet its financial obligations. Argentina's stock market down more than five percent today, a day after the government again delayed an announcement of a new economic package. Investors are anxiously awaiting measures to reinvigorate Argentina's ailing economy, including a tax cut. But the government so far has failed to agree with its provincial governors about tax- revenue sharing.
In tonight's corporate news: an executive shakeup at UAL, the parent of United Airlines. Chief Executive Officer James Goodwin stepped down over the weekend. Some of United's unions had demanded his resignation after he warned that United Airlines would "perish" next year. UAL's board hired John Creighton, a former Weyerhaeuser executive, as its new CEO.
FedEx expecting to top profit estimates for the current quarter. Growth in its ground business and cost controls offsetting interruptions in its express unit. FedEx has received $101 million in government assistance since those terrorist attacks.
SureBeam won a $26 million contract to provide the U.S. Postal Service with technology to eliminate bacteria such as anthrax. SureBeam uses electron beams to destroy those harmful substances. The stocks of all of those companies higher on the session. Movie fans this weekend flocking to see ghosts and a self- proclaimed alien this weekend, on Halloween week. It was a strong weekend for the movie makers. "K-PAX," starring Kevin Spacey as a man who claims to be an alien and Jeff Bridges as his therapist, led box office sales. The Universal Pictures film grossed $17.5 million in its first three days.
The top 10 films containing two Halloween-themed thrillers: "Thirteen Ghosts," at number two, brought in almost $16 million for Warner Brothers. "Bones," at number nine, grossed a disappointing $3 million. Rapper Snoop Dogg failing to lure fans to the movies.
Another pop-star flop: "On the Line," starring two members of boy band 'N Sync, which has grossed $2.3 million. Box-office receipts for the top 12 films totaled $73 million; that's up one percent from the previous weekend and up three percent from a year ago.
"WOLF BLITZER REPORTS" will begin in just a few minutes. Let's go to Wolf now in Washington to find out what's ahead. Wolf?
WOLF BLITZER, ANCHOR: Thank you, Lou. The attorney general and the FBI director have just announced a new terror threat facing the United States. How worried should our viewers be? We'll ask three experts: retired General Wesley Clark, Paul Bremer and Ken Edelman. We'll also ask them who's winning in this U.S. war against terrorism. That and much more coming up next. Lou?
DOBBS: Wolf, thanks a lot. Coming up next here, more on Bayer's mounting Cipro fortune. We'll have your thoughts and we'll tell you what to expect tomorrow.
DOBBS: Tomorrow, we'll have a report on consumer confidence. Economists expecting consumer confidence not to go higher for the month of October. And we'll quarterly earning reports tomorrow from Dow component Procter & Gamble as well as Verizon Communications, Continental Airlines and Kellogg.
Well, we've been hearing tonight about the impact of surging Cipro sales on the fortunes of Bayer. The government's demand that Bayer lower its price for Cipro has caused a number of our viewers to write in with some concern.
Jim Jones of Odenton, Maryland, writes to say: "I do not think the government has the right to force Bayer to give their product away or force them to reduce their fair market value. If we allow the government to mandate a price, what is the motivation for companies to develop new products that may be needed for the next crisis?"
Russell Roth of Rancho Santa Margarita criticizes Health and Human Services Secretary Tommy Thompson. He writes, "Threatening Bayer with more radical Congressional action if it refuses to sell its Cipro at a price acceptable to him is nothing less than extortion."
And some international viewers complaining that U.S. policy on Cipro is simply hypocritical. Judith Ryan of Sao Paolo, Brazil, says the United States has long criticized Brazil for giving away HIV drugs to thousands of impoverished patients who need them, overriding the patents of drug companies who refuse to lower their costs. She writes to say, "The United States -- the U.S. threats of drastic action against Bayer seemed to mimic the attitude of the Brazilian government."
And Irwin Friedman, a doctor in South Africa, writes us, saying: "The United States has demonstrated an astonishing degree of hypocrisy in advocating free market mechanisms for other countries while intervening in its own markets at the first signs of potential threats."
Well, we want to hear from you about this issue and any other issue in the news. And you can always reach us by e-mail at moneyline@CNN.com. Let us hear from you.
For tonight, that is MONEYLINE. We thank you for being with us. I'm Lou Dobbs. Good night from New York. "WOLF BLITZER REPORTS" begins right now.
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