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Markets Down, Ominous September Start; No-Fly Zone Established in Massive Manhunt for Cop Killer in Illinois; Video Shows Police Killing of Unarmed Man in Texas.

Aired September 1, 2015 - 14:30   ET

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


(COMMERCIAL BREAK)

[14:32:10] BROOKE BALDWIN, CNN ANCHOR: We'll take it back to our breaking news out of the Fox Lake, Illinois, area in a moment where a 32-year veteran of the force, local law enforcement, was murdered this morning. We'll have much more on that.

I do want to pivot quickly to the Dow. The markets, you see all the red here, down 413 points. Hour and a half left of the trading day. Really what is -- today is September, yeah, September 1. Ominous start really to this month. Now, this, after obviously what we were covering over the last week, the market is suffering quite a downturn with regard to what happened in China.

I have Alison Kosik standing by on the trading floor.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: You thought by turning the calendar a new month, you wouldn't see the triple-digit moves. That's not the case. You see the losses get deeper as the day goes on. This is mostly about China, again. So it's the same old problem. This time around, Wall Street was handed some more evidence that the world's second biggest economy is losing steam in the form of the weakest manufacturing report in three years that coming out of China. That's spooking investors. That caused the investors to hit the sell button today. Interestingly enough though, not only China causing these worries.

Also some data in the U.S. Our manufacturing data wasn't so hot either. We got a manufacturer report that's the worst in two years. Even though our economic picture is a lot brighter than China's, it's not consistently strong. It's not enough for investors to hang their hat on. Not seeing anything positive to buy in the market for. And that's why you're seeing the setting. Really pick up steam as the day goes on -- Brooke?

BALDWIN: What about sort of tangentially on this market wise we're talking about the fed, and what Janet Yellin would decide as to whether or not -- I know they had announced they'd be raising the interest rate for the first time since '08. What do you expect?

KOSIK: And that's the thing, no one knows. That uncertainty is what's rattling the market. One thing to keep in mind, it's been a really long time since we have seen interest rates go up. The fed is careful on when that will happen, but now all of this market volatility is really throwing the fed into -- throwing the fed for a loop. Because at the same time, the fed says this decision on when interest rates should go up should be data dependent, we want to see what kind of data comes out of the U.S., how is manufacturing looking and consumer sentiment looking, they're good, but not great. The fact that we're at least six years out of the recession and this data isn't that strong considering.

So you've got the Fed wrestling with that and also the market volatility that's happening in China. You know, the fed may be willing to -- won't be willing to say it specifically but it looks like the global economic picture. It is not looking great. So it leaves the fed in a real pickle because at the same time it wants to raise rates because it's been so long, it also doesn't want to undermine the recovery that continues to be under way here in the U.S. When you raise those rates, it sort -- it's called -- some people think of it as tightening, meaning it makes it so it's more difficult to get a loan for businesses and for average Americans -- Brooke?

[14:35:33] BALDWIN: Yep, yep, all interconnected.

Alison Kosik, thank you so much.

I want to get back to the breaking news here as we know, three individuals considered extremely armed and dangerous, wanted right now in connection to the murder of a 32-year police officer. It happened early this morning in the Fox Lake area of Illinois, just outside is of Chicago. New information as they're looking for the men. Land, air and sea, and the FAA has established a no-fly zone within two nautical miles of the area we're looking at right now.

Back in a moment.

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[14:40:40] BALDWIN: Back to our breaking story, this three decades- plus veteran in the Fox Lakes area outside of Chicago was murdered this morning and now police are hunting by land, air and sea for the three individuals they want to find in connection to what happened there.

Let's go first to our aviation correspondent, Rene Marsh, who has new information with regard to the air space in Illinois -- Rene?

RENE MARSH, CNN AVIATION & GOVERNMENT REGULATION CORRESPONDENT: Well, Brooke, I can tell you the FAA has established a no-fly zone in the area. Two-mile radius around the area where this manhunt is underway. This is quite normal in a situation like this. Most likely one would have to believe it is the police department who asked for this no-fly zone to be established and with this no-fly zone that essentially means that if you were not authorized by that area police department, you cannot fly in that area. There are only -- they're only allowing police choppers or perhaps relief aircraft needed in the area. Oftentimes you will see this happen so police will have enough space to do the work they need to the as they search, using choppers or whatever else in this area. So that is the latest from the FAA. Making this area where this active search is going on a no-fly zone. So if you are not a part of the police department or this operation, which we see unfolding, you're not allowed to be in the area -- Brooke?

BALDWIN: No small planes, no drones, none of that right now.

Rene, thank you very much.

Anthony Roman, let me bring you in, former detective, currently in investigative analysis.

I know you worked on a lot of shootings in your previous life. Putting yourself in the shoes of the ATF, local law enforcement hunting down the three individuals when you know that a 32-year veteran has been murdered, how does that change the equation here from an investigative perspective?

ANTHONY ROMAN, INVESTIGATIVE ANALYST & FORMER DETECTIVE: Well, this is an incredible manhunt and simply because what has happened here is a capital crime in Illinois. First-degree murder can be charged when a police officer is killed in the line of duty. And as a result of that, these criminals have nothing to lose. These fugitives are out there. If they kill another or a third or a fourth police officer during this manhunt, really they are facing the same type of penalty. So it makes it incredibly dangerous for the police officers, the FBI agents, and DEA on the ground. Fortunately, a lot of resources are being deployed. They have listening devices, they have aviation units. And by the way, although it's a no-fly zone, I was formerly a commercial pilot as well. The police units can fly drones, they can fly their aircraft there and that no-fly zone is established so that law enforcement can operate aerial vehicles there unencumbered by any press helicopters or any sightseers that way want to fly over. So the police have their hands full here.

BALDWIN: I'm still back two beats on what you said about the three, that they have nothing to lose. Nothing to lose. And police know that as they're searching for the three of them.

When you look at these pictures, Anthony, I don't know if you have a monitor in front of you, quite a wooded area. There's an interstate here that runs along it. I'm looking now at railroad tracks. I don't know if they had a car they could use or armed and could force their way into someone else's car. All are possibilities. What are you doing and listen, this is all about during daylight hours because once night fall, it gets much trickier.

ROMAN: Well, this is a tricky search. You have semi-rural area here. That is some suburban areas where there are clusters of homes and lakes and recreational areas and schools, and then you have clusters of what appear to be rural areas and vast acreage of that kind of topography. That presents a very difficult dilemma for the police. First, the police have to assume that they secured the murdered officer's weapon, and that they secured any portable radio equipment he may have.

(CROSSTALK)

[14:45:13] BALDWIN: I didn't even think about that. They could have his radio.

ROMAN: Yeah, they can. They can be listening in to what's going on. So they have to move --

BALDWIN: Wow.

ROMAN: -- to a discreet or an encrypted frequency to ensure that these assailants cannot listen in to the communications and the coordination of the search. That is first and foremost.

Second, the police officers when they're searching in a wooded area generally do not hold ground. What that simply means, Brooke, is that they move from position to position, clearing an area. It is always possible for an assailant or someone being hunted if they're familiar with the woods, if they're an outdoorsman to back track the police officer. That means go to the lateral position and outflank them and come up behind them. The police officers also have to be concerned about my booby traps, snares or traps or they can actually be shot at from a concealed position. Because there is so many places to hide and the police officers are now really dealing with a three- dimensional environment. Because they have to look up as well as to the left and right and to the back, because these assailants can be in the trees as well. So very, very difficult. Very dangerous work.

BALDWIN: Wow. Anthony Roman, all great points. Underscoring the difficulty here of what is at stake for all of these members of law enforcement to track these people down.

Anthony, thank you so much. I want you to stand by.

And Deborah Feyerick is next to me here, who has been on and off the phone talking to sources.

What more do we know?

DEBORAH FEYERICK, CNN NATIONAL CORRESPONDENT: What we do know is the response right now is massive. We have a tactical team from ATF, SWAT teams that are descending, you have the Illinois police and the sheriff's department, local police departments, all responding in order to find the three individuals.

What we do know is, according to a source, the police officer, 32-year veteran, as you mentioned, did have cause to stop these men who appeared somewhat suspicious. He wanted to find out perhaps what they were doing. The men began to run. The police officer radioed for backup and gave chase. We are told by a source, the responding officers were close enough so that they actually heard a shot, presumably, the shot fired at the officer. We don't know whether there was one or whether there were multiple. The responding officers did hear a shot. When they arrived they found they had an officer down. We don't know how many there were, so we don't know if several stayed and called for -- called 911 and then the others went to find the individuals that were running. But this is a major foot pursuit right now. A major manhunt and clearly, the fact that this happened and these men as we just heard have nothing to lose --

(CROSSTALK)

BALDWIN: That's haunting.

FEYERICK: It's haunting because they are going to do everything they cannot to be caught. That's why the people in the area have been told to shelter in place. It's a state of lockdown because what you don't want is you don't want the three men, who may be desperate, who certainly are dangerous, taking anyone hostage. That's one of the reasons that you keep people inside. Plus, think about it, you see all of the vehicles that are swarming the area. The last thing you want is, you know, regular traffic. That's why you see the roads clear, which is what Ryan --

(CROSSTALK)

FEYERICK: -- who is on the ground, said. Air space as well. The last thing -- you know, you don't -- you don't want collateral accidents to happen when law enforcement is simply trying to do its job.

BALDWIN: All right, Deborah Feyerick, thank you so much.

Quick break here. We're back with the breaking story out of Illinois in just a moment.

(COMMERCIAL BREAK)

[14:53:10] BALDWIN: Well, taking you back to the breaking news in the Fox Lake area of Illinois in a moment, and that 32-year veteran officer who was killed this morning.

Let's go to Texas. A police shooting there, caught on camera has a number of people wondering why a man had no shirt, no gun, although law enforcement says he was armed with a knife and resisting arrest. His hands -- or at least you can see one hand up. Why would an officer use deadly force against him? That's how a bystander with a cell phone described the scene that unfolded in San Antonio Friday. He recorded this incident of these two Bexar County deputies trying to arrest 41-year-old Gilbert Flores. Flores had a knife, reportedly for 20 minutes. They tried to detain him.

So we have the video for you.

Obviously, a warning. This is extraordinarily disturbing to watch because you will see the final moments of this man's life.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: He just shot (EXPLETIVE DELETED). Well, they just cold blooded shot that (EXPLETIVE DELETED).

(END VIDEO CLIP)

[14:55:10] BALDWIN: OK. Alina Machado is live.

And, again, it's sort of tough to understand what's happening. There's obviously a pole hiding part of this man's body, initially. Can you tell me first and foremost what the sheriff department is saying in response to this?

ALINA MACHADO, CNN CORRESPONDENT: Yeah, Brooke, I mean the video is disturbing. This all happened Friday morning during a domestic disturbance call. We have a picture of the man killed from a previous arrest. His name is, as you mentioned, Gilbert Flores. Now, the Bexar County sheriff's office said he was armed with a knife and they found a woman with a cut on her head and an 18-month-old baby that appeared to be injured.

Now, the video was taken from a distance, so there's a lot you can't see. You can't see the weapon that Flores allegedly had. There are also times in the video when Flores is seen stepping out of view and we can't see what's happening. And you can't hear the interaction between Flores and the deputies.

But as you mentioned, the video is raising questions about this shooting.

And here's what Bexar County Sheriff Susan Pamerleau had to say.

(BEGIN VIDEO CLIP)

SUSAN PAMERLEAU, SHERIFF, BEXAR COUNTY SHERIFF'S DEPARTMENT: Certainly what was in the video is a cause for concern, but it's important to let the investigation go through its course so that we can assure a thorough and complete review of all that occurred, of the evidence, and the actions of the officers.

(END VIDEO CLIP)

MACHADO: So this investigation is very active. Both of those deputies have been with the sheriff's office for more than ten years. Both are on paid administrative leave which is what formally happens in these kinds -- normally happens in these kinds of situations. Now the Bexar County district attorney's office said there was a second video shot closer to the scene, but they would not elaborate on what that video shows. We are told that there is no dash cam video. And that neither officer was wearing a body camera -- Brooke?

BALDWIN: Alina, stay with me.

Tom, let me bring you back in, former New York police detective.

Watching, you watching this, squinting at the video. It's tough to really see and as pointed out, there's that pole. You can only see one of his hands up.

TOM VERNI, FORMER NEW YORK CITY POLICE DETECTIVE: Right.

BALDWIN: Again, you know, law enforcement said he had a knife and he had his hand up and he was killed. What do you make of it?

VERNI: Well, domestic violence calls is one of the top two or three most dangerous calls they go on here. We have a child apparently injured. The wife or domestic partner injured as well. So we clearly know there was some actual violence that took place here. That he was armed with a knife according to reports. That makes it extremely dangerous for the officers because now they don't want to get injured or killed by the knife. Ideally, what they're going to do here is isolate and contain him, which they're attempting to do. Not to let him run away with the knife in his hand and injure someone else potentially. Seemed like they were trying to establish a perimeter around him. You know, he does show -- you know, he had his hands up at some point. We can't see if there's a knife in his hand. He's close enough to them that he could clearly charge at them at any moment, especially with a knife in his hands, and cause damage. At that point, if they --

(CROSSTALK)

BALDWIN: Which we don't know. We can't see.

VERNI: We can't see from there. But the distance, it only takes a second or two to close in -- most shootings take place in about 20 or 25 feet or so. So they don't want him to get any closer than what he is at that point. You know, reports have said that they have used nonlethal methods. They may have used mace or a taser. Mace and tasers don't work on everybody. If you have somebody who is in an emotionally disturbed state, having committed some violence with a weapon, they don't want to get closer to this guy.

So again, we can't see whether or not they have -- he has the knife in his hands or not. That's going to be crucial as to whether or not they can articulate using that deadly force against him at that point.

BALDWIN: They investigating. I'm sure Alina Machado will be on it.

Alina, thank you.

Tom, thank you.

VERNI: Thanks.

BALDWIN: Stay with me.

And you stay here. We have a lot more to talk about.

Let's go. Hour two.

ANNOUNCER: This is CNN breaking news.

[14:59:32] BALDWIN: Top of the hour. This is CNN. I'm Brooke Baldwin.

We are continuing our special live coverage here out of the Fox Lake area, just outside of Chicago, in Illinois, a massive manhunt underway by air, land and sea. As I mentioned, Fox Lake is where we're talking about where police, FBI, U.S. Marshals, ATF, sheriff's deputies, honing in to find these three individuals who they want. They have been on the run for hours after this officer, a 32-year veteran of the force, was murdered early this morning. I can tell you the local high school is on lockdown while the search

is under way.