>> some people say this could just be a temporary spike. what everybody's really waiting to see is if this bond buying program that the fed announced today is going to help the economy. will it grow jobs? that's what everybody really wants to see. all right, so the closing bell, we've got 203 points higher on the dow. what a day it's been. >> 203 points in a rally all within a couple of hours. alison kosik, thank you very much. see you tomorrow, alison. now it's time for wolf blitzer and "the situation room." wolf. don, thanks very much. happening now, violent protests spreading across the muslim world. more u.s. diplomatic posts are undersiege right now after the killing of the united states ambassador in libya. so how dangerous is it now for americans abroad? also, as the u.s. moves to hunt down the killers, libyan authorities make at least one arrest. but was it a mob attack or something much more ominous? and mitt romney's taking heat even from some republicans for his harsh criticism of

president obama's foreign policy. is he ready to dial back or double down again? i'm wolf blitzer. you're in "the situation room." u.s. warships are moving toward libya today as president obama vows that no act of terror will go unpunished. his words. but in the grim aftermath of the u.s. consulate attack in libya which left the u.s. ambassador and three other americans dead, there are still serious questions as to which group was responsible. meantime, violent protests sparked by an anti-islamic film spreading across the muslim world today. in cairo, crowds have again gathered outside the u.s. embassy right now. they've been throwing rocks and fire bombs as police answer with tear gas.

in yemen, police open fire to disperse rioters at the u.s. embassy where a security wall was breached. security officials report four deaths. and in iraq, protesters stepped on and then burned a symbolic american flag as rival sunni and shiite muslims marched together. libyan authorities have now made at least one arrest in connection with the attack on the u.s. consulate in benghazi. let's go live to our pentagon correspondent chris lawrence getting new details on what's going on. chris, what are you learning? >> yeah, wolf, just in the past few hours libya's own prime minister told cnn's own christiane amonopore have arrested one man. he is currently being interrogated. and libyan authorities say they have several others under surveillance and more arrests may be on the way. meantime, u.s. intelligence officials say they are digging deeper and getting more

information about who may have been behind this attack. at this point they say it does not appear to be a core al qaeda group, wolf. >> what does that mean? a core al chi da affiliate groups. what does that mean, a core al qaeda group? >> they think it's very possible that this could have been an al qaeda-inspired group. some group that is not directly affiliated with the hierarchy of al qaeda but does support the aims and ideals of al qaeda. >> and what about the u.s. warships, chris, that are heading toward libya right now? where are they? and are those extra u.s. marines already on the job? or are they being deployed? >> the extra marines are on the job. one of those warships is now in position off the coast of libya, the other is in en route and should be there within the next day or two. and now the attention is turning with another embassy breach in yemen today to what happened in

benghazi and whether anything could have been done to prevent it. was the u.s. consulate in benghazi adequately protected? the state department is defending its security plan. >> a robust american security presence inside the compound. >> reporter: libyan security guards manned the outer perimeter. as you move further in, there are contract guards hired by the state department. u.s. special agents are the last line of defense inside the hard line. a congressional source says during the attack at least four state department security guards in six libyan government guards fired at the attackers. another eight to ten american security guards were at an annex building two miles away. >> we determined that the security at benghazi was appropriate for what we knew. >> reporter: and just last month a security briefing provided to congress found the number of security disruptions is smaller than might otherwise be expected

in a post-conflict environment a wash in weapons and dominated by dozens of armed groups. a quick reaction force of 50 marines arrived wednesday and guarding the main u.s. embassy in tripoli. but a former diplomatic security service agent says temporary setups like benghazi don't usually get marine guards. >> it's not viewed the same. you don't have standards that are put into place which include setback from the roads and ballistic window film. so when you start looking at these temporary kind of arrangements, it's very, very difficult to kind of protect. >> reporter: he says there were other factors in going with the smaller security footprint. >> there's a lot of politics that's going on behind the scenes with the various rebel groups, who's in charge of the country on any given day, the relationship that we have with the libyan government, the perception of committing u.s. marine corps regardless of the fact that they're there

fulfilling a very specific duty, it becomes very, very political. >> we're told the investigation into what happened will ask the questions about the vetting that was done for the libyan guards. always difficult in a situation like that where you're post-war but the country is still very unsettled. we also know that several u.s. troops and units around the world have been notified they may be moved to u.s. embassies around the world to beef up security if needed, wolf. >> chris lawrence watching this important part of the story. thank you. meanwhile, u.s. diplomatic missions around the world, they are potentially bracing for trouble. president obama has ordered all u.s. embassies and diplomatic posts to review security and increase it if necessary. cnn's foreign affairs reporter elise labott is here in "the situation room" watching what's going on. sort of reminds me of what happened in 1979 in iran when there were protesters outside the u.s. embassy and eventually

as we all know they went in, took american diplomats hostage, held them for 444 days. >> well, wolf, that's right. but things have changed a lot since '79. as you know, now congressional regulations mandate that embassies overseas are much more fortified than they were in '79. and they have a lot more security measures, setbacks, things like that. but the u.s. is very concerned about these type of protests in libya, egypt, also hearing about possible protest in sudan. and we've seen what happened in cairo. so what they're happening now are emergency action meetings. every post is reassessing their security. white house has said whatever you need, if that's additional personnel, marines on the ready, and working with host governments. there could be more setbacks, more barbed wire or more personnel from the local forces. >> what if u.s. diplomatic personnel, embassy officials, been told to do?

>> if they've been told if you don't have to come, don't come. work from home. might not be so best to have all our personnel in the embassy. and they've been sending messages to u.s. citizens overseas in areas they know there's going to be protest to say, listen, stay away from the emergency. if there's an emergency, we'll come find you. >> what are embassy personnel doing to try to calm down some of those protesters and tell them, you know, the u.s. is not the enemy? they've got other issues to deal with. >> it's a real administration wide effort, wolf. state department diplomats are combing social media websites, online sites trying to counter this negative information about this film, about the prophet muhammad to say, listen, the u.s. is not responsible. we've seen the muslim brotherhood for instance on some twitter feeds putting out message of condolence on one and calling for protest on the other. they're also working with host governments to say, listen, we stood by you through these revolutio revolutions, you need to standby

us and make a stand. and lastly they're talking to e mums. they're concerned about friday prayers tomorrow looking to make sure nothing gets out of hand. >> in the coming hours this could dramatically escalate as we get closer and closer to the friday morning prayers. elise, thanks very much. disgusting and reprehensible. that's how the secretary of state hillary clinton is labeling that anti-muslim film. but can she convince the islamic world that the u.s. can't really do anything about it? and a major move to boost the u.s. economy. what it might mean for your money and your job. ♪ ♪ ♪ ♪ [ male announcer ] at&t. the nation's largest 4g network. covering 2,000 more 4g cities and towns than verizon. at&t. rethink possible.

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try the #1 gastroenterologist recommended probiotic. align. align naturally helps maintain digestive balance. ♪ ooh, baby, can i do for you today? ♪ try align today. look at this. this is happening right now. these are live pictures from cairo not far from the united states embassy in cairo near tahrir square. crowds have assembled. it's now after 10:00 p.m. local time in cairo. they're getting ready for friday morning prayers. we expect thousands of people to

show up. a little while ago we saw fire fights going on there. this escalation of violence in cairo clearly getting bigger and bigger as we speak. right now our own ben wedeman is standing by. we'll go to him shortly. even as we look at these live pictures, let's check in with jack cafferty. he's following the attacks unfolding in the middle east as well. you're here with the cafferty file. >> renewing questions in washington about which countries get u.s. foreign aid and whether they deserve it. some house conservatives wanted to strip out foreign aid to both libya and egypt from a six-month funding bill set for a vote today. that's not going to happen because it was simply too late to make any changes to that bill. nevertheless, some republicans are questioning now if the u.s. should keep giving money to countries run by what they call radical islamists, like the muslim brotherhood in egypt. others say beforehanding out aid the united states ought to make sure libya's helping with the investigation into the attack and murder of our ambassador and

three other americans, apparently they're doing that if the reports today are true. not everybody agrees though according to the hill newspaper senior house republican david drier says it would be a big mistake to cut funding to libya and egypt. dryer says it's essential now more than ever to strengthen the ties with the fledgingly democracies. it's worth pointing out that as millions of americans are suffering under a weak economy here, our government is sending a lot of money overseas that we don't have to other countries. u.s. foreign aid to egypt alone totals about $1.5 billion a year. second only to israel. and the new egyptian president, mohamed morsi, didn't even bother to apologize for the attacks on the embassy in cairo until today, two days after they happened. that tells everybody quite a bit right there. the u.s. withheld aid to egypt this past year when the government was cracking down on protesters. now a decision's going to have

to be made whether to do it again. that's the question, should the u.s. halt foreign aid to libya and egypt? go to cnn.com/caffertyfile. post a comment on my blog or go to our post on the "the situation room" facebook page. wolf. >> thanks very much, jack. the protests in cairo, they are cleaning up. ben wedeman is on the scene for us right now. he's back in cairo. ben, it looked an hour or so ago like it was really escalating, the violence, the fire fights going on, police coming in with tear gas. we've got some live pictures now as well. what's the latest near the united states embassy in cairo? >> reporter: well, until a little while ago, the protesters had moved forward fairly close to the street that leads to the american embassy. but since then with tear gas and rubber bullets it appears the egyptian security forces have been able to push the protesters back. but this is really been the case all day long, wolf. it's been back and forth.

according to the egyptian authorities more than 200 people wounded in these clashes. clearly the egyptian government is walking a very fine line between the inflamed sentiment on the street and their desire not to cause a real rupture in relations with the united states. so it does appear they are making an earnest effort to keep the protesters away from the embassy. but they simply are not succeeding in pushing them much further away from the area. and there's really maybe about 500 protesters out there. it's not a huge number. but it appears that this is going to be the case all night long. wolf. >> but it looks like the muslim brotherhood is trying to organize protests for tomorrow morning, friday morning prayers. and there could be thousands and thousands of protesters showing up and the potential for violence, obviously, is very real. >> reporter: that's right, wolf.

but i've spoken with muslim brotherhood officials who stress that the protests they are organizing tomorrow are not going to be taken place in this area in tahrir square or anywhere near the american embassy. what they told me they want to do is to draw people away from this part of cairo. they will be holding these protests in mosques around the city, across the country, but trying to keep them away from the embassy and therefore to prevent any sort of clashes in the area -- in this area, wolf. >> as you know, ben, the united states has a major consulate in alexandria as well. what, if anything, are you hearing about what's going on outside there? >> reporter: well, as far as we know there's not much going on outside of this very small part of cairo. in fact, if you go just two blocks from here, you will see that life is actually going on fairly normally. and i've spoken to egyptians who

are not participating in these protests. and although they are offended by this trailer that appeared on youtube, they're also equally in condemnation of the violence that's taken place in or rather around the american embassy. people are worried. it's worth noting that tourism of course is going to suffer from this. and a good 15% of the egyptian population depends on tourism. at the same time a very large american delegation, business delegation, wound up a visit here in cairo on september 11th, the same day when these protests broke out. so there are many egyptians who simply are mortified by this violence and would like to see at the mt peaceful protests and not anywhere near the american embassy, wolf. >> i've been listening to the demonstrations not far from where you are right now. occasionally i hear some popping sounds, which sounds like gunfire. is that what it is?

>> reporter: no, no. that is tear gas. occasionally some rubber bullets. as far as i can tell there's been no gunfire in this area. i think the egyptian security forces are eager to prevent any deaths, which would certainly inflame an already inflamed situation. >> and unlike the other day when they stormed the walls around the u.s. embassy in cairo, i assume the egyptian military, the police there surrounded that entire embassy compound now. and those protesters are not going to get anywhere near the actual embassy, is that right? >> reporter: well, that's certainly what obviously american diplomats are hoping. but what we've seen not only on this occasion but on other occasions that at the end of the day when these protests take place, it's a fairly small number of conscripts who are paid very little who are defending these installations.

let's not forget it's not just attacks on the american embassy, there have been attacks on the israeli embassy as well as the syrian embassy here. and many of those instances the security forces either were incapable or were unwilling really to stop the protests. i think now after this crisis has gone on and escalated to the extent it has, the egyptian authorities are now well aware of the danger to u.s. egyptian relations if for some reason they are incapable of defending these diplomatic installations, wolf. >> ben, we're going to stay in close touch with you, obviously. ben wedeman back on the scene for us in cairo. much more on this story coming up, obviously, over the next several hours. there's other important news we're following as well including news about the united states' economy today. major action by the u.s. federal reserve to jumpstart the economy. it's already had a huge impact on wall street. probably your retirement savings

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once again we have a lot of coverage coming up on the anti-u.s. violence spreading across the arab and muslim world right now. what's going on in cairo clearly very, very disturbing. we have live pictures we'll bring to you, demonstrations continuing there. but there's another very important story involving your money that's unfolding right here in the united states. the federal reserve today launched a new attempt to try to stimulate the u.s. economy. and the stock market took off like a rocket. the dow jones industrial average soared nearly 207 points closing at their highest level, get

this, the highest level in almost five years. the dow jones has doubled over these years. our chief business correspondent ali velshi is joining us now. ali, first of all, take us through the fed's decision today and what it means. >> all right. by the way, the dow is made up of 30 stocks, every single one of them is in the green, in case you're invested. let's talk about what the fed did. a third round of quantitative easing. short-term is qe-3. that's why we've been talking about it for so long. the fed made a few decisions. the first is they decided to buy $40 billion of what you call mortgage backed securities every month. just think of them as bonds. these are all of these mortgages that get packaged and resold. but the fed is going to go to the bank, you give us your bonds, we'll give you $40 billion every month. i'll tell you what that means in a moment. but they did also say there's no end date. they're going to keep doing this until they see an improvement in the economy and improvement in the unemployment situation. they're also going to keep interest rates, which are at the

federal reserve level 0% to 0.25% exceptionally low until mid-2015. the initial plan was for the end of 2014. so that's what they announced. the key here though, wolf, is not the rest of it, it's the quantitative easing. >> and ben bernanke as you know, ali, he also mentioned what we're calling that fiscal cliff that occurs at the end of the year. >> right. >> unless congress and the president take dramatic action. so how concerned is the federal reserve chairman about that? >> very concerned. and we all should be by the way. that's where this becomes tricky. and a lot of conservatives have criticized today's move because they basically say this is the government's job. the government should be handling these things. this should be a political decision in washington about the fiscal cliff, about the budget. the fed is doing what it can, but ultimately it's not clear what the end result will be. it is clear it will cost us a lot of money. i've got a graphic i can show you to try and explain what this is. on the left side of your screen, that's the federal reserve. they're buying those bonds. they're giving the $40 billion

to the bank. the bank then makes loans to either businesses, which open up plants and factories or stores or to individuals. let's say to buy houses. and that creates economic activity. and that should create growth and jobs. it's just not clear that's going to work. there's been a lot of criticism of ben bernanke. some conservatives have said it's partisan. ben bernanke made a point of saying it's not partisan. you know, wolf, he and allan greenspan before him are both republicans, but mitt romney has been very clear that if he becomes president, he will not nominate -- re-nominate ben bernanke to head the fed. this has become even a political discussion. >> at least on this day wall street loving what happened. >> yes. >> ali, thanks very much. so is all the anti-american violence spreading in the middle east really just part of an internal power struggle in the arab world? you're looking at live pictures of cairo right now. not far from the u.s. embassy tahrir square. david ignatius of "the

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intriguing among other things you wrote this, i'll put it up on the screen "the cairo uproar appears to be partly a case of radicals wanting to undermine a more moderate governing party. this isn't really about america, it's about factions battling for power in a fluid political situation." what you're suggesting is the muslim brotherhood led government, president mohamed morsi, may be more moderate than some of the elements trying to undermine him. >> at the end of my piece, wolf, i said we should call them less extremists, the muslim brotherhood is still can be very militant. but i think when we look at these events, even though we see the tragic death of an american ambassador and three other americans, attacks on u.s. embassies and consulates, we obviously think of this as being about america. but we are in what i like to call the fog of revolution in these middle east countries. and in these countries the

ruling governments, the muslim brotherhood government of mohamed morsi now in egypt are under challenge from people who are much more extreme who have much more radical vision of islam and who are opportunists trying to challenge the government and using the u.s. as a handy target. that doesn't mean we shouldn't be worried about the safety of our personnel. it just means we should be careful and understand that this is really a power struggle in the midst of a revolution that's still going on. >> because when you see the u.s. embassy attacked, the american flag torn down and burned in cairo, that huge u.s. embassy there -- you've been there many times, i've been there as well. and you see it all occurring on the eleventh anniversary of 9/11, the immediate conclusion is simply these are people who hate america. >> part of it certainly is anti-americanism, that's obvious to all of us. and it troubles us deeply. we love our country. we hate to see our flag

attacked, our embassies attacked. but at the end of the day what has to happen in each of these countries is that the local authorities, the egyptian security service, the libyan security service, the yemen security service, has to stand up and protect the integrity of diplomatic facilities. ours, everyone's. and that's the demand that we need to be making. the notion that the u.s. can send in the marines and beat this back, unfortunately, the only reason we'd send in the marines is to rescue our people and get them out of harm's way. but in terms of protecting these places, it's up to the governments. they're now in power. that's the demand we should be making. >> you write of an intriguing parallel to what's happening potentially now in cairo to what happened at the u.s. embassy in tehran, in iran back in 1979 in the aftermath when the shaw was overthrown there, a long-time

u.s. ally. tell us what you meant. >> frankly, wolf, this scares me. in 1979 you had islamic revolution in iran. there were many iranians who were unhappy that it was moving too slowly. and so the more militant faction calling themselves radical students decided to capture the revolution. and they did it by seizing the american embassy. we all remember that if we were alive then. this feeling of america held hostage. what really happened internally in terms of iranian politics was that the radicals took over and grabbed revolution and still hold onto it this day. they seized control in '79 and never let go. and that's what we have to be watching for is in these countries radicals moving to exploit what is to some extent a vacuum of power and push the situation to a much more extreme level. >> because if the u.s. fears that those american diplomats,

embassy personnel are in danger, whether in cairo or tripoli or any place else of being held hostage, we know that four american diplomats were killed at the u.s. consulate in benghazi, then the u.s. immediately has to withdraw, get out of there. don't you agree? >> well, i think we have to be sure that our people are safe and not in a situation where they could be held hostage. i'll tell you something that your viewers may not know, wolf. our embassy in egypt on this night, tuesday night, violent chanting, crowd storming going over the fence, the demand that our embassy made to the egyptian government was get the police in here now. get these people out of our compound. it took too long for the egyptian government to respond. but it finally did. and the police were finally deployed and order was restored. but that's the demand that has to be made every day.

get the police here. you're responsible for the safety of these people. exercise authority. and i think if we focus on that and not just getting furious, we'll probably do ourselves more good. >> these are live pictures coming in from cairo right now. disturbing pictures indeed. david, thanks very much for joining us. >> thanks, wolf. mitt romney's caught lots of flak for criticizing president obama's international policies right in the midst of this crisis. we also noticed a significant change though in his tone today. it isn't an apology, but what's going on? >> northern virginia could well determine who the next president is. real estate in hong kong, and the optics industry in germany? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 70% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing.

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as anti-u.s. demonstrations and violence spread across the muslim world, mitt romney today

toned down his criticism of president obama's policies overseas. our national political correspondent jim acosta is in new york, he's on new york's long island i should say where romney's hosting a private fundraiser. what's the latest reaction from the republican nominee, jim? >> reporter: wolf, mitt romney is in new york to do some fund raising. but earlier today he was in virginia where he continued with this theme that the president is showing weakness on foreign policy. but he did soften some of that super heated rhetoric that got him in some hot water with members of his own party. mitt romney steered around the controversy he started earlier this week when he accused president obama of sympathizing with the attackers on u.s. diplomats in the middle east. instead, romney opted to grieve for the victims. >> what a tragedy, to lose such a wonderful, wonderful people. >> reporter: within seconds he was interrupted by a protester.

>> i would offer a moment of silence, but one gentleman doesn't want to be silent. so we're going to keep ongoing. >> reporter: while romney did go onto charge the president with seeking defense cuts that would weaken national security. >> as we watch the world today, sometimes it seems that we're at the mercy of events instead of shaping events. >> reporter: he stayed away from his harshest attack of the week, that mr. obama is an apologyist. >> i think it's a terrible course for america to stand in apology for our values. >> reporter: but there are no apologies for romney's comments. a senior campaign advisor told cnn it was wrong for president obama to not immediately criticize the mob that ripped down an american flag at the u.s. embassy in cairo. the romney campaign also pointed to support it received from former members of the bush administration. former defense secretary donald rumsfeld tweeted, the attacks on our embassies and diplomats are a result of perceived american

weakness. mitt romney is right to point that out. and liz cheney, daughter of former vice president dick cheney wrote in "the wall street journal," apologizing for america, appeasing our enemies, abandoning our allies and slashing our military are hallmarks of mr. obama's foreign policy. columnist neuman was critical of how defended initial remarks at a news kmps. >> at one point he had a certain slight grimace on his face and i thought he looked like richard nixon. >> reporter: arizona senator sidestepped romney's handling of the issue on cnn. >> the whole tick tok back and forth is not something i'm totally aware of or care too much about. >> would you advise him to say that? >> listen, the one thing i don't do because i'm the loser is advise people -- >> senator mccain.

>> reporter: a senior romney advisor told cnn the campaign is confident that this controversy will blow over. the question though is whether there will be blow back from voters. but that strategist i talked to, wolf, said to romney's criticism of the president highlights as what he described as big differences in this campaign. >> more muted though today. jim acosta, thanks very much. this just coming in to cnn. new polls on the u.s. economy. our chief correspondent john king has a closer look at the numbers. john. >> wolf, let's start with the question that dominated both political conventions. that is a big factor on the campaign trail, are you better off than you were four years ago today? let's tap into the state of ohio and pull out the numbers. look, when you ask people are you better off than you were four years ago today? this is among all registered voters. 37% say, yes. 34% say no, things are worse. 19% say things are the same.

you would tend to think that would benefit governor romney. what is striking though like everything in our politics how polarized opinions are even about the economy. look at these numbers right here. democrats tend to say we're better off. tell it straight right here. 55% of democrats say they're better off than they were four years ago. look at this, 70% of republicans say they're worse off than they were four years ago. in the middle the voters who might decide the election, it's a closer split, but 49% nearly half of independents say their economic situation is worse off now than it was four years ago. again, those are numbers that would tend to favor, you would think, governor romney. now, that's the partisan breakdown. let's look at this regionally. as you know, the president's coalition is heavily based in urban areas. urban voters tend to be more optimistic. they say they're better off, about half of them, say they're better off than four years ago. but go into the suburbs and rural areas, these are critical to governor romney. voters there nearly half of both suburban and rural voters say

they're worse off than four years ago. that's how people feel personally about their economic situation. how though do they feel about the country's economy overall? let's move over to another battleground state of virginia. pull those numbers out. how do they feel overall about economic conditions in the country today? this is still a very pessimistic look and one, again, you would think would be damaging to an incumbent president. only 32% of americans, just shy of one-third, say economic conditions today are good. nearly seven in ten, 68%, more than two-thirds say economic conditions are poor. and yet again when you break this out, you see, again, the polarization in the views even on the economy. a majority of democrats say things are good. look athis. 91% of republicans, 91% of republicans say things are poor. again, if this is the middle of the electorate, the group that will matter the most in a close election, that should be an advantage for governor romney, more than seven in ten independents say things are poor in the economy today. so that's the look at four years ago. are you better off or not and how you feel about the economy

today. people are, i would be shy to use the term more optimistic, but when they're looking ahead a year, they're more pessimistic than they have been in some time. ask all registered voters what about the economy a year from now? this is a strikingly different number. nearly seven in ten, two-thirds of americans, say things will be good a year from now. that's much more optimistic than the economy today. only 30% say things will be poor. and look at the turnaround from just a year ago. 60% a year ago said one year later would still be poor. people again reluctant to use the term optimistic but much less pessimistic. this is something that could work in the president's favor. one last point on this plays out in the campaign, who's responsible for this? if people are in a funk about the economy, feel down about the economy at least at the moment, feel better off than four years ago. do they blame anybody? we asked who is more respondent for economic conditions today? bush and george windchill bush and republicans, 35% blame mt. obama and the democrats. end on this point, the president

tends to win on this question, however george w. bush will not be on the ballot. >> john king, good point. thanks very much. does mitt romney need to fine tune his message since nearly half of the voters feel worse off than they were four years ago? gloria borger, ryan lizza, both standing by. they'll join us next.

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live pictures coming in from cairo right now near the united states embassy, tahrir square. we're going back there in a few moments. let's get to our strategy session right now. joining us the new yorker magazine, washington correspondent ryan lizza, and cnn's chief political analyst gloria borger.

look at this, gloria. a year ago we asked are economic conditions good or poor? a year ago 14% thought they were good. that's pitiful. now it's up to 32%. not so good either. it's improvement from where it was a year ago. the question, was this good for romney, obama? >> glass half full, glass half empty, look, it's a little better news for the president. means people are feeling a little bit better about their economic situation. but clearly, wolf, they're not where they need to be. and the question is, who's really better able to manage the economy? and you know, the good news for the president is that six months ago he was down about six points on that. now he's in our latest poll it's a virtual tie. so maybe people are coming around to the fact, there you see it, 50%, 49%. so maybe people are coming around to the fact that maybe the president just needs more time. maybe they're buying the bill clinton argument. you need to have some patience.

>> what's strange, maybe the public's expectations are just different? it's surprising that that many people say things are on the mend when you have these really mediocre jobs numbers. and i think there's an argument that over the last not just the couple years but the last decade that the american public's expectations about what the government can do to fix the economy are lower. so that question the way that reagan asked it in 1980 doesn't have the same resonance. >> are you better off today than you were four years ago? where's romney's -- where does he have an opportunity right now? >> romney's in northern virginia suburbs, the president was in the denver suburbs, 47% of suburban voters think that the economy is worse than it was four years ago. that's an opportunity for romney particularly married suburban women. suburban voters consider themselves generally more independent voters, more

pragmatic voters. so if you're mitt romney, you're going to be spending a lot of time in the suburbs. and if you're obama, you're going to be doing the same thing. >> republicans have said to me over the past few days as a result after the conventions, the latest polls, given the relatively poor state of the overall economy, the jobs, the unemployment numbers, why isn't romney crushing president obama right now? why is this so close? >> why is it so close? one favorability, people like obama more in the favorability polls than mitt romney. i also go back to what i said, i think expectations about what government can do to improve the economy are lower. so people vote on different issues. they don't necessarily believe that either of these guys can use the government to make things better. if they like obama a little better, that gives him an edge. >> for some reason, and i can't quite figure it out and i've been talking to a bunch of people today asking this question, why isn't mitt romney sealing the deal? why isn't he doing better given the fact people generally have a good sense about him and the economy? i think it's due to the fact

that people haven't bought into him yet as a leader. and maybe this whole cairo issue could be a problem. and he hasn't, you know, when you want to fire somebody, you have to find someone to replace them with. i don't think they've decided that he's the person. >> we have to leave it here. he's got an opportunity those three presidential debates coming up next month. >> a coherent message for why he'd do a better job. >> if he can do that, focus in like that, he still has an opportunity. >> and more detailed too, wolf. i don't think people are seeing that. >> so who's behind the killings at the united states consulate in libya? we have new information, new details on the investigation that's unfolding right now. and i'll speak live with the chair of the senate intelligence committee, diane finestein, she's just been briefed by general pe trus and the cia. hey, good call on those mugs. can't let 'em see what you're drinking. you know, i'm glad

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jack's back with the cafferty file. jack. >> in light of recent events, wolf, the question is should the united states halt foreign aid to libya and egypt? james writes, to libya, no, but to egypt, yes. until they can prove to us that they're a worthy recipient of this aid. it ought to be scaled back. libya's still trying to set up their government, get infrastructure established. 45 years under gadhafi was just as bad as what saddam did in iraq. gary in arizona writes you bet your bippy we should and we should do so immediately. the billions we throw to these clowns ought to pay down our own impossible debt. if they don't like it, they can lump it. that's an american phrase they wouldn't understand. mia in florida says, yes, we are no longer the uncle with the deep pockets. we have issues here to take care of. interfering in another country's

foreign affairs depleted our own resources and caused ill-will abroed. i can't safely board an airplane with a pair of fingernail clippers. libya's government is in transition, this type of transition takes time. therefore the u.s. must continue to support libya's foreign aid as libya has offered their support in this attack. however, egypt is a different story. and the u.s. ought to continue to closely monitor their progress and the actions of their leaders. and tom in texas writes, pinching wallets usually gets one's attention. after countless years of pouring money into various governments, they begin to think they're entitled to the funds. i only wish i could get a few hundred million dollars allowance. here's my address. if you want to read more about this, go to the blog, cnn.com/caffertyfile. or through our post on the "the situation room" facebook page. wolf. >> jack, thanks very much. and you're in "the situation room." happening now, an arrest made in the savage attack that killed

four americans in libya. ahead, the latest on the information coming in from the chair of the u.s. senate intelligence committee, dianne feinstein. and enemy or ally, the violence escalates across egypt, the middle east and north africa. and a former u.s. navy seal being called an american hero. we're learning more about the four people who died working for their country. we want to welcome our viewers in the united states and around the world. i'm wolf blitzer, you're in "the situation room". anti-american rage sweeping the middle east and north africa right now. at the center of the violence, egypt's tahrir square where

fiery flashes lit up the night sky. more than 200 people have reportedly been injured in a sea of tear gas, molotov cocktails and burned out cars. and the worst may yet come. our senior international correspondent, ben wedeman, is in cairo. he's back there. he's joining us now. ben, what's the very latest? the pictures, they seem so ominous. >> reporter: yeah, i think the pictures may be a little more alarming than reality because what you have is maybe 300 or 400 very young protesters who don't seem to have any political affiliation who are basically trying to push toward the american embassy. the egyptian security forces firing back with tear gas, throwing rocks trying to keep them away. at the moment it's fairly static. the security forces were pushed back towards the embassy. now they've moved forward again. a lot of noise, a lot of

dramatic pictures. but really this is only happening in a very small area of cairo, wolf. if you go just two blocks up the street, it appears it's just another thursday evening in cairo. wolf. >> but it's going to escalate as we get closer and closer to friday prayer. that's only going to be in a few hours given the time difference between here on the east coast in the united states and where you are. how close are these demonstrators to the u.s. embassy in cairo? >> reporter: well, let me just take a peek here. they may be about 300 yards away from the embassy itself. but between the embassy and the demonstrators are hundreds of egyptian riot police, some armored vehicles as well. and therefore i don't think they're going to get much closer. of course there is a lot of worry about what tomorrow could bring. friday, the day of prayer, the

muslim brotherhood, the largest and best organized islamic group in the country has said they will be holding demonstrations against that trailer that appeared on youtube across the country. but they stress those demonstrations will not be happening in tahrir square, will not be near the american embassy. they'll be at mosques away from this area but across the country. one official with the muslim brotherhood saying they're trying to divert that anger away from this part of town. they sympathize with some of the sentiment of the demonstrators, however they say they condemn any violence against diplomatic installations. wolf. >> ben wedeman, could be a long night for you and our entire team out there. thanks very much. behind this vicious outrage, an anti-muslim film made right here in the united states. it's gaining some traction out there on the internet. how do the protesters know about it? let's go to cnn's ian lee. >> reporter: wolf, the protests

continue behind me. you also have people all around come here to watch what's going on. and talking to people many of them have seen this video that muslims find so offensive. and if they haven't seen the video, it only takes a description from a friend or social media to get their blood boiling. this anger is expected to continue tomorrow as the muslim brotherhood and other islamic organizations have called for mass demonstrations. massive but peaceful demonstrations. local amoms are expected to give fiery sermons in this region. >> ian lee, thanks very much. now to syria. the libyan prime minister is just giving cnn new information about the arrests in the attack. u.s. officials are also actively pursuing new intelligence information. cnn's intelligence correspondent susan kelly is getting new information. what are you learning?

>> intelligence officials are narrowing down that list of suspects and sifting through new information they say is helping them get a better picture of just who was behind this attack. >> we are going to bring those who killed our fellow americans to justice. >> reporter: a promise of justice as behind the scenes the u.s. intelligence community sifts through a steady stream of information that has come in the past 24 hours. as the investigation continued on the u.s. side, the libyan prime minister telling cnn that at least one libyan national who had been arrested. >> there was one arrested this morning and i think other about three or four currently being pursued. there is suspicion that those people belong to some extremist group here. >> cia director david petraeus briefed officers thursday afternoon. they may not be ready to name a perpetrator, but the list of likely suspects isn't so long. one of the more organized groups being scrutinized by

intelligence agents, led by a former guantanamo detainee. the group released these pictures last month showing just how well-equipped they are. even their fleet of vehicles bears their name. one group they've ruled out according to an intelligence source, al qaeda core, based in pakistan. counterterrorism experts say it's more than likely carried out by sympathizers with no relation to the core. >> that's going to be a small sliver of people. when you look at people who believe storming the u.s. embassy is okay, i'm going to tell you that slice of the pie is significant. >> reporter: and that's part of the reason say experts why nailing down the perpetrator is so tough. in libya groups are sometimes groups in name only with memberships and allegiances shifting rapidly. now i've been told by several official who is are active in the u.s. intelligence community that there is no actionable intelligence that supports the notion this was a pre-planned attack.

no intercepted communications, no human intelligence that could have warned the u.s. that this was coming. those voices seem to be in the minority though at the moment, wolf. but nonetheless they highlight just how confusing sifting through the aftermath of an attack like this can be. >> they're just beginning this investigation for all practical purposes, suzanne, thanks very much. joining us now the chair of the senate select committee on intelligence dianne feinstein. suzanne just reported on. senator, thanks very much for coming in. first of all, we're hearing some suggestions that in addition to the four americans killed at the consulate in benghazi, some others were injured including seriously injured. what if anything can you tell us about that? >> yes, i just don't know, wolf. what i can tell you is that our entire committee, all 15 of us, eight democrats, seven republicans, were present for a briefing by director petraeus

that lasted a couple of hours. and it was a very good briefing. what i would like to do, if i may, is simply thank on behalf of the committee, the libyan government for their solidarity, for their denouncement of this event and for taking the actions they have to vigorously investigate and arrest some people. i also want to thank the currently anonymous libyan citizen who took ambassador stevens to the hospital. he didn't survive, but to me that was such a human and real act. and it just has a lot of credit with me. and i'm very grateful for the solidarity that libya is showing. >> does it look like this was a carefully planned operation that was in the works for a while? what's the latest assessment on that? >> i can say that i've seen no evidence or no assessment that

indicates it was. i can certainly say that. there was a protest. and it could well be that quickly some two dozen people took that as an opportunity to attack. they have attacked the benghazi consulate before. i believe it was on june 6th. so this is not a new thing. but i think one of the great lessons out of this is there are consulates in these very troubled nine middle eastern nations must be in very secure locations if we have them there at all. >> the libyan prime minister has told our christiane amanpour that they have arrests. >> once the news is ahead, but i'm very pleased to learn the same thing. people have been arrested. and i believe an investigation is going on in this country

concerning the individual who did this very obnoxious, 12-minute preview of some very stupid movie and wrong-headed movie. and he may well not be who he has claimed to be either. so we're going to have to find out a lot about what happened. i would hope -- a big day is coming up tomorrow, it's friday. it's a day of prayer in the islamic world. and i would really hope that cool minds prevail. we now have 11 ongoing demonstrations in various countries. and more expected. and i think -- i hope that people who are very concerned as all the world is by this will understand that demonstrating, hurting innocent people, perhaps some deaths resulting, please don't let it happen. >> you've been praising the

libyan government. obviously it's a new government. they've got limited capabilities. what about the egyptian government? did they do everything they should do to protect the u.s. embassy in cairo? >> well, not immediately as i understand it. but mr. morsi has put out a statement. i didn't see where he denounced the incident. i would really hope -- and this is in a sense a test that the egyptians help see that our embassy is protected. i think this is very important. just as we would protect the egyptian embassy here. it is very important. that we get through the next few days, that cooler, saner minds prevail, that we're able to do the due diligence on this 12-minute trailer. and i think, you know, it's such a farce. it's so stupid. and the man that produced it

certainly made no contribution to art or literature, truth or justice. >> do you still support, senator feinstein giving the egyptians more than $1 billion a year in military assistance? >> i think our relationship with egypt is very important. for me because today the brotherhood has 50% of the parliament, we have a muslim brotherhood president, it's important to me to see how egypt goes. whether this administration in egypt is going to concentrate on the economic and just development of their country, or on very right wing islamist ideology. i don't know that yet whether they're going to agree that israel has a right to exist, that's very important to this country. that they favor a two-state solution. the one area where i think the

government has shown really common sense is working on the problems in the sanai and doing this in conjunction with israel. i think that's one very hopeful sign. so i want to. i have helped egypt in the past. i want to continue. but we need to see which way this government is going to go. and i think the statements of the government in the next few days also are going to indicate which way this government goes. and that's important for us here to listen to that. >> let's see what happens over the next few hours on the streets of cairo not far from the u.s. embassy as well. >> that's exactly right. >> senator, thanks very much for coming. >> you're very welcome. thanks, wolf. egypt, enemy, ally? question facing president obama as outrage protests against the united states. up next, you're going to find out how the president is responding today. plus, the man who had breakfast with ambassador chris stevens in libya on the day he died.

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let's get right to jack. he's got the cafferty file. he's looking at the crisis in the middle east and the presidential race. jack. >> all right, wolf. mitt romney could have done himself in in the last 36 hours or so. at the very least the republican candidate for president likely badly damaged his chances of being elected by the way he reacted to the violence in egypt and libya. andrew sullivan of the daily beast suggests romney's response to all of this makes him unfit, sullivan's word, for the responsibility of running the country. sullivan lays out the reasons he thinks romney ought to be disqualified from being president including romney's knee-jerk judgments based on ideology and not reality. his inability to back down when he said something wrong. and his argument that president obama sympathized with the murderers of america's

ambassador to libya. criticizing america's u.s. commander in chief while u.s. interests are still under attack and americans were dying comes off as amateurish and unpresidential and could be political suicide for romney in the long run. it is times like these when an unguarded comment can leave a lasting impression. compare romney's response to how the 1980 republican candidates for president reacted to the iran hostage crisis under president carter. as the atlantic points out, when news broke that an effort to rescue the american hostages in tehran had failed, ronald reagan said "this is the time for us as a nation and a people to stand united." and george h.w. bush went even further saying he "unequivocally supported carter and that it was not a time to try to one-up politically." mitt romney's been around long enough, he ought to know better. the question is this, did mitt romney kill his chances of becoming president with his

reaction to the violence in egypt and libya? go to cnn.com/caffertyfile. you can post a comment on my blog or go to our post on the "the situation room" facebook page. wolf. >> jack, thanks very much. the movie that sparked the deadly protest across the middle east is no doubt inflammatory. but is it fueling the violence? or are extremists just using it as cover? we're sitting on a bunch of shale gas.

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since tuesday's deadly assault in libya, we're seeing protests break out in a lot of countries in the region. you can see here in yellow all across north africa and indeed in the middle east throughout that whole region. check out the crowds right now, by the way, outside the united states embassy in egypt.

only about 300 yards away or so we were told by ben wedeman. mostly in near tahrir square. as violent protests rage in cairo and elsewhere, president obama is using one word to issue what's regarded as a stern warning. our white house correspondent, dan lothian, is joining us now from golden, colorado. dan, is the administration saying egypt is an ally or not? >> reporter: well, what they're saying it appears that they are not. and so the question is now whether this represents a shift in the u.s. policy towards egypt. as you know, wolf, under the ousted former leader of egypt, hosni mubarak, egypt was considered an ally. but you have a democratic elections recently, member of the muslim brotherhood was elected president, and there have been concerns among u.s. officials that egypt is still trying to find its way. so now you have these protests. and yesterday during an interview with telemundo,

president obama was asked whether this new regime was still considered an ally. here's how the president answered that question. >> would you consider the current egyptian regime an ally of the united states? >> i don't think that we would consider them an ally. but we don't consider them an enemy. they are a new government that is trying to find its way. they were democratically elected. i think that we are going to have to see how they respond to this incident. >> reporter: the white house spokesman jay carney and other administration officials were pushing back a bit saying that the president was correct in using legal and diplomatic terms. he said that word ally is "a legal term of art," but, wolf, a lot of people having questions about the president using that again saying whether there's some kind of a shift in u.s. policy. jay carney saying that there is no shift. and no change expected in the more than $1 billion in aid that the u.s. gives to egypt, wolf. >> there seems to be a little disconnect going on right now

between the white house and the state department because the state department is making it clear that egypt still is what's regarded as a major non-nato ally. victoria nuland answering questions at the state department today. she's the spokeswoman for the state department. question to her, you're saying the administration of the state department still regard egypt as a major non-nato ally and it is still a recipient of the privileges all of that entails? and she answered with one word, yes. so as far as the state department is concerned, egypt under this new government, this muslim brotherhood-led government, is still regarded as a major non-nato ally of the united states. so there are major military privileges that go along with that. so i guess the white house and the state department are going to have to coordinate whether or not egypt is an ally or not. the state department saying yes, the white house saying what the president said. obviously the president is the president. what he says holds true.

it was a little weird though to see the state department in effect saying something different than what we heard from the president. what else is the president doing out there, dan? >> reporter: well, you know, the president campaigning. and one of the questions that we're being asked earlier yesterday before the president came to his first stop in las vegas was whether or not he would go forward with the trip because he was dealing with the death of four americans. the president pushed back his trip just a bit as he made those comments on the violence in the region from the white house. but still going forward with his trip. what you saw though was a president trying to do a delicate balance between doing his sort of official business and also campaigning. at that stop yesterday in las vegas, the president toning down his remarks, not criticizing mitt romney directly by name. also off the top of his remarks he talked about the violence in the mideast region. the president also doing the same off the top of his remarks here in colorado. an administration official telling me that the president is

able to deal with both, to still go out there and campaign but also stay in touch, get briefings from his national security advisor, also make calls as he did from colorado yesterday to the leaders of libya and also egypt. able to be president but also campaign at the same time, wolf. >> good point. dan lothian traveling with the president. thank you. meanwhile, outrage is spreading over that movie trailer depicting the prophet muhammad has a womanizer, a ruthless killer a child molester. but who actually made the movie? we're checking into that. we're taking a closer look. love to walk. yeah, we found that wonderful thing. and you smiled. and threw it. and i decided i would never, ever leave it anywhere. because that wonderful, bouncy, roll-around thing... had made you play. and that... had made you smile. [ announcer ] beneful. play. it's good for you.

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in city after city across the muslim and arab world, protesters are venting anti-american fury over a crude anti-islamic film made in the united states. but it may be rooted in a long simmering religious conflict inside egypt. brian todd is here. he's been looking into this part of the story for us. what are you finding out? >> wolf, that conflict is between more hardlined islamists in egypt and members of the koptic church, the largest christian church in the middle east. there are suggestions that cops are involved in making this movie. there's no connection between the church itself and the film. but the mere implications have been very provocative. at the genesis of all this violence, a poorly made film called "innocence of muslims" depicting prophet muhammad as a violent bafoon.

t u.s. federal officials believe the man who made the film was convicted three years ago for bank fraud. a production staffer who worked on the movie says the filmmaker also went by the name aben abenob nakuola and believed he was a coptic christian. he had been in egypt raising money for the film. the suggestion that cops were involved in the movie inflamed egyptian media. >> islamist use of this idea that cops were behind it was apparently effective in drumming up support for the attacks. >> reporter: this analyst and a coptic church official tells us there's no connection between the church itself and the movie. but the film was promoted by a man who identifies himself as a coptic christian. in an interview with the middle east media research institute last year, he said this. >> translator: every muslim

knows he's one of egypt's occupiers. >> reporter: cnn's tried repeatedly and unsuccessfully to reach him. an official with the coptic church here in the u.s. told us that the church -- as for morris, the coptic official says the church has no connection to him and doesn't sanction what he says. egypt's coptic church is roughly 2,000 years old. coptic christians make up 10% of egypt's population and there's a long history of animosity between them and radical muslim groups. the bombing of a church in alexandria last year killed two dozen people. more were killed last fall in clashes with the egyptian army. how far back does this go? and what's the reason? >> the tension is due to the violence that cops have experienced both under the previous regime. and since that regime collapsed. and i think that that has really

fueled mistrust. >> trager says it's estimated that about 100,000 cops have tried to leave egypt since the ruling last year. the tension between the cops and the members of the muslim brotherhood. of course that group is now the ruling party in egypt. >> yes, it is. what more can you tell us about this filmmaker? >> that staffer who worked on the film told us he's married with two children. he's had several aliases. we've been going through aliases for two days. he was convicted in 2009 for bank fraud. we're told the fbi has contacted him because of possible threats against him. we're told he's not under investigation right now. >> brian, thanks very much. brian todd working this story. less than two years ago we watched as these kinds of protests spread across north africa and the middle east. protesters fighting to overthrow dictators and regimes. fast forward to today. we're seeing these same countries erupt in violence anti-american protests.

let's bring in bobby gauche, editor at large for "time" magazine. he wrote this week's cover story "the agents of outrage," an excellent article, bobby. thanks very much. let me read a line from your article. the arab spring replaced the harsh order of hated dictators with a flowering of neophyte democracies. but these governments with weak mandates evershifting loyalties and poor security forces have made the region a more chaotic and unstable place, a place more susceptible than ever to rogue provocateurs fo meanting violent upheavals usually in the name of faith. the bottom line question, bobby, did the arab spring make that whole region even more dangerous than it used to be? >> i think the evidence is now in, wolf, that at least in the short-term it certainly has. these dictatorships in the old days could be relied upon to crack down on any kind of protest with maximum brute force.

democratic governments as we know cannot do that. if they expect to be re-elected. and the other problem is that the new governments don't, i think, have full control over the security which is divided in loyalty between the old regime and the new one. was not especially good in the first instance. so these are new problems for the middle east. and i suspect that for some years to come before there is a sort of democratic culture that emerges. for some years to come there are going to be incidents like the one we've seen this week where things very quickly spiral out of hand. the political leadership don't know how to deal with it. the security powers are completely overwhelmed. and lives, american, foreign, or even egyptian are put i harm's way. >> as we look at these live pictures coming in from cairo right now not far from the u.s. embassy, bobby. here's the question. the so-called film or trailer out there on the internet, anti-islamic film, is that the

excuse for what's going on? or do you feel it really did trigger these protests? >> it's only the start of a chain. it's not a simple matter of somebody putting a video on youtube and the street in the arab world erupting. there are provocative things said about islam and the prophet online everyday, every hour of everyday. you don't see riots breaking out everyday. there are a set of people working behind the scenes sometimes at cross purposes. sometimes people who don't really necessarily have the same agenda who crank up this hatred. so you have a filmmaker in california, you have an extremist pastor in florida, you have a coptic american-egyptian in washington, d.c. they bring this thing to the attention of the arab world. and you have a television host in egypt who's well-known for inflammatory comment who picks up on this and then magnifies it. and then you have political groups, you have religious groups and armed militias on the

ground who then take that in egypt and in libya and run with it. so this is organized. this is not spontaneous. this is not random. there's a sequence of events that leads to four americans being killed in libya. and it's not accidental. >> not accidental indeed. all right, bobby, excellent article. the cover story in the new issue of "time" magazine entitled the agents of outrage. bobby gauche from "time" magazine. did the united states ambassador to libya, chris stevens, obviously murdered in libya, did he have enough security? one libyan politician actually warned the ambassador about that on the very day that he died. we have details straight ahead. ♪ ♪ [ male announcer ] you've been years in the making. and there are many years ahead. join the millions of members who've chosen an aarp medicare supplement insurance plan

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one person is under arrest, more are being pursued in the death of the united states ambassador to libya. questions still remain though about the security around the u.s. consulate in benghazi at the time of the attack. vivian walt writes for our sister publication "time" magazine. she interviewed a libyan politician who had breakfast with ambassador chris stevens the day he died. vivian is joining us. vivian, i understand he warned the ambassador -- this is what you're writing, he warned the ambassador that he was in deep potential security danger. what did you hear? >> well, wolf, one of libya's most prominent, most-respected politicians had been having breakfast with chris stevens in the consulate and was truly alarmed by the lack of security. he said listen, chris, you're the most powerful country in the

world and you have less security than even the jordanians and you have to bring americans here to protect the consulate because the libyans simply don't have the equipment, the training and they simply can't get the job done. >> what kind of security did he have inside that consulate? what was there? >> well, there are two versions of the story. he said what he saw was four libyan guards out front fairly relaxed. each of them with a rifle over his back. very low key security. there was a feeling not at all, kind of a feeling being on alert. let's not forget this is 9/11. the u.s. officials that have spoken to reporters have said that they had plenty of security and that they had reviewed the security procedures before 9/11 as routine matter before the

anniversary of the attacks and that they did not find any inadequacies or any holes in the system. so clearly there's a very wide divergence. but the accounts that he gives is one of an eyewitness on the ground the morning of the attack. >> you also report that the two of them had a discussion about a suggestion that the libyan government what was actually providing some cover for extremists? what was that about? >> well, this was not a new discussion in fact. they had been having this kind of discussion over the past several months. and when i was in libya a few months ago, i heard that the same discussion was going on between among others western diplomats and people like libyan politicians like this one in which they argued, look, you

have all these armed militia running around the countries, hugely well-equipped with rocket propelled grenades, mortars, rockets, et cetera. and they've been given salaries by the government, there's a sector plea given free reign in a lot of localities simply to fill a security gap even though the local militia didn't really have any loyalties to the capital and had very little sentiment towards the new democracy. and in fact many of them had hostility against the new democracy. >> what were his final words to ambassador stevens? >> i'm not sure exactly what his final words were. but he did say, you know, people love americans. they admire the american way of life here in benghazi. obviously people feel an

enormous sense of gratitude for the western intervention last year, but that there are plenty of extremists and we just have to put an end to these people. >> vivienne walt, appreciate it. >> you're welcome. in our next hour we're going back to tahrir square in cairo for a live report on the egyptian protests we've been seeing against the united states. [ male announcer ] how can power consumption in china, impact wool exports from new zealand, textile production in spain, and the use of medical technology in the u.s.? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 70% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence.

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get right to jack cafferty. jack? >> did mitt romney kill his chances of becoming president? with his reaction to the violence in egypt and libya. got lots and lots of mail. ted in bloomington, indiana.

he has never shown interest in foreign policy except where to keep his offshore money. the left sees this as a reaction that highlights romney's questionable decisionmaking skills. and the right spins it as a sign of strength and hard talk and contrast to a weak president. i don't see it changing anything as it just reinforces what both sides have been saying all along. joann in cottonwood, arizona. mitt romney quickly brought it to the attention of the people around the world that the u.s. foreign policy is weak and inadequate. to not have proper protection at the u.s. embassies on 9/11 is a pathetic lack of leadership. there were plenty of warnings. wesley writes, i hope so his remarks were ill considered given the circumstances. we had more than enough of shoot from the lip presidents. we desperately need a president like. >> mark writes you mean like obama a overreacting to the

story that brought us the beer summit or the "if i had a son he would look like trayvon martin." caffer cafferty, you're a fool. romney may have done us a big favor by showing how inept he is before it is too late. sympathizing with the terrorists who killed our diplomats? this man has no shame and no class. berry writes, you bet you. you want to read more go to the blog or to our post on the situation room's facebook page. wolf? >> thanks, jack. a former navy s.e.a.l. being called an american hero. we're learning more about the four americans killed in libya. s you can actually use... but mr. single miles can't join his friends because he's getting hit with blackouts. shame on you. now he's stuck in a miniature nightmare. oh, thank you. but, with the capital one venture card... you can fly any airline, any flight, any time.

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we can now put a face and a name with those third of fourth americans killed in libya and his family is calling him an american hero. let's bring in lisa sylvester. >> hi, wolf. we know the u.s. ambassador to libya killed. a state department officer and the name of a third victim, glen doherty. so hard to sum up in three pages. he joined the navy s.e.a.l.s when he was 25 and his team responded to the "uss cole" attack. he was an avid skier and good friend and brother and he, like the other victims, had an intense love for his country. the three victims who have been identified were not based at the u.s. consulate in benghazi. sean smith a husband and father of two worked out of the hague and on a short-term duty in libya.

ambassador chris stevens was based in tripoli. the most recently identified victim, glen doherty a u.s. security officer who lived in california, but grew up outside of boston. from different areas at the consulate on assignment. they leave behind grieving hearts. kate quigley is his sister. >> we ask for privacy during this time as we grieve for our friend, my brother, our brother, our son and our american hero. >> as a navy s.e.a.l., doherty was a trained sniper and stayed active working for california fitness company called s.e.a.l. fit. he is seen here in this video having fun in a friendly competition. >> mr. doherty, winchester, massachusetts, long way from home. how old are you? >> 41 1/2.

>> 41 1/2. >> that's right. >> doherty was just 42 when he died. ambassador stevens leaves three younger siblings. tom stevens was his brother. >> he was doing what he always did, representing the united states in an exceptional manner. he was my big brother. so, all things that typically as a little brother, all that guidance, just being best friends, that's what i'll miss the most. >> sean smith an air force veteran worked that state department for ten years. at the time of the attack, he was online playing the game eve under his handle and posted this message online. tributes are pouring in. a friend of smith's saying, "he had no desire for fame or recognition. he simply saw things that needed

to be fixed and said about trying to fix them. his loss all the more tragic because it was caused by forces he detested. those of hatred, intul rance and ignorance." the same could be said for all the victims. >> very, very sad, wolf. there was a fourth american killed. we're still waiting for that person's name to be released pending notification of relatives. wolf? >> our deepest condolences to all these families. lisa, thank you. happening now, anti-american protests explode across the middle east. reports of arrests in the death of the united states ambassador in libya. all dramatically shifting the focus of the presidential campaign. i'm wolf blitzer and you're in "the situation room." anti-american rage and it is sparked by a bizarre-low-budget

movie by a mystery filmmaker. this is the scene in the capital of yemen. protesters there scaled the fence around the united states embassy and clashed with security police who now report four demonstrators killed. violent protests also in cairo. egyptian state tv reports more than 200 people have been injured in battles just outside the u.s. embassy, an area that now looks more like a war zone. as far away as beng ludash, muslim protesters are taking to the streets venting their outrage over the film by burning an american flag. similar scenes are unfolding in almost a dozen countries from north africa to asia and our correspondents are covering all of the late-breaking develops. in egypt, yemen and libya and beyond. ben wedemen all standing by live with the latest developments. let's begin right now in egypt where the protesters first started. our senior international

correspondent ben wedemen joining us live now in cairo. ben, are those protesters still angry about the movie or is there something else going on right now? >> i think definitely the movie is part of it. i spent a good part of the afternoon speaking with those protesters who feel it was an insult to islam and feel that the united states should have done more to stop that film or that trail eer from getting on youtube and also the concern that this issue is being taken advantage of by extremist groups who not, who don't necessarily agree with the ruling muslim brotherhood in egypt. that they're trying to make this an issue with which they can attack the government led by mohammed of the muslim brotherhood. in fact, i spoke to one muslim brotherhood official who suggested that this is perhaps a deliberate attempt to destabilize egypt at a very

sensitive period. a destabilization taken by ribl islamic groups and parties who are trying to undermine the government here. >> we're showing viewers, ben, live pictures coming from the tahrir square area, not far away from the u.s. embassy. now after midnight in cairo. even though the protests aren't as large, necessarily, as they were during the arab spring and we all watched that unfold, you were, obviously, there. these protests right now have a symbolic importance. explain what's going on. >> certainly. the symbolism is huge. the fact that now we've had almost three days of constant clashes outside the u.s. embassy and it really does sort of focus in a way some of the latent resentment against the united states that goes back decades. and, as i said, if this is a resentment that i think is being fueled, being stoked by groups that are trying to capitalize on this issue.

now, i was here in cairo in 2006 and if you recall, around the region they were huge demonstrations against the danish cartoons that were published then. however, here in cairo, the reaction was relatively calm and i spoke to one muslim scholar at the time and he said this is a very dangerous issue because it is something that those extremist forces can exploit and cause far greater problems than the symbolism of, for instance, a video clip or cartoons published in a newspaper. wolf? >> all right, ben wedemen on the scene for us, as he always is in cairo. kate baldwin has some more reaction. a lot more information coming in from the region. >> from the region and another deadly protest in yemen. we want to now talk about that one. security officials in yemen now reporting that four people were killed in protests outside the u.s. embassy there. monitoring developments from beirut. what is the latest you're

hearing? >> okay, eyewitnesses and officials are telling us that right now the protest scene has really calmed down substantially outside the u.s. embassy. four protesters were killed in those clashes. what i'm hearing from eyewitnesses and activists is how shocked they were that these protesters, many of them saying about 2,000 or so were able to get this close to the u.s. embassy. they were able to breach the security of the compound. we saw pictures throughout the day of people trying to scale the wall of the embassy. we saw, we saw video of tires and cars being set on fire just outside the perimeter of the embassy. and, now, at one point, it seemed to calm down in the early afternoon, but then the ang aer bubbled up, again. more security forces, more yemeni security forces were deployed. they were using water canons and tear gas against these

protesters to try to disperse them, even though this situation is calm now. the concern is what's going to happen tomorrow. tomorrow is friday, that's a big protest day in the region, that's been a big protest day in yemen for the last couple years. what is going to happen? that's where all eyes are right now. yemeni president had issued an apology to the american people and to u.s. president barack obama for what happened and he said that a thorough investigation will be conducted. kate? >> and how concerned, you're -- how concerned are people on the ground concerned about tomorrow, friday, being the day of prayer and protests, many, many fear that protests could start firing up, again. how concerned are people on the ground? >> they are extremely concerned. they are concerned because tomorrow is a day where protests have already been called for, that's according to activists who heard this and eyewitnesses there on the ground who were hearing this from demonstrators who were out there today. but they're also concerned

because of what they saw today. i've been to yemen many a times. i have been to this site at the u.s. embassy. this is a very heavily guarded site. this is one of the most protected sites, not just in the capital of the country, but in all of the country. and this is something that was reflected, this concern throughout the day. they were saying if today spontaneously that there was so much anger that people were able to march to the embassy and get that close somehow and start breaching security there and start scaling the wall, what could happen if there is even more people and more ang aer being fueled and what if it is stoked by extremists in yemen. they just don't know and they're very concerned about what might happen tomorrow. i spoke to u.s. officials in the embassy today that said everybody was okay and accounted for and they said that the embassy had not been evacuated. >> that's at least good to hear. mohammed jamjoon, thank you so much. do want to bring you up to date one thing president obama spoke on the phone with yemen's president just a short time ago and we just received a read out.

the white house released this statement in part, i'll read it to you. president hadi committed to doing everything possible to protect american citizens in yemen and said he had deployed additional security forces around the u.s. embassy. president obama reiterated his rejection of any efforts to denigrate islam and emphasize that there is never any justification for the violence we are seeing. just getting that read out right now, wolf. of course, it also says reaffirming our commit to the government and people during their historic transition. >> the demonstrations will get intense, not only in cairo, but yemen. also we're watching what's going on in libya right now. let's join her from the libyan capital of tripoli. you have details on one arrest on this deadly attack on the u.s. consulate in benghazi. what can you tell us? >> wolf, senior libyan officials have announced progress in their investigation on the attack in

the consulate in an interview with cnn's christiane ampore just a short while ago. a libyan national was detained in benghazi in connection with the attack. we also heard from the deputy interior minister who said they have a number of individuals already in custody and they're being interrogated for their possible role in the attack. the prime minister said there are suspicions that these individuals do belong to extremist groups but they said that is something they cannot yet confirm and they're investigating. he said the arrests were made based on photographs that were taken around the scene of the attack and that some people had come forward with names based on these photographs. the prime minister said they're also taking the attack on the consulate very seriously and he

himself is overseeing the investigation into the attack. wolf, if the libyan authorities have, indeed, members of suspected radical islamic groups that are thought to be behind, this would be really a major step for them. the authorities here have been really criticized for not doing enough to confront these militant jihadeist groups that are known to be operating in eastern libya. >> all right, jomana, thank you. secretary of state hillary clinton is making clear exactly what she thinks of that antiislamic film that has sparked these protests across the middle east. but she's also making clear, making it clear that there is not much she or anyone else in the u.s. government can do about it. watch this. >> to us, to me, personally, this video is disgusting and

reprehensible. it appears to have a deeply cynical purpose to denigrate a great religion and to provoke rage. but as i said yesterday, there is no justification. none at all. for responding to this video with violence. >> the secretary of state speaking earlier on the sensitive subject. meanwhile, we're getting new and chilling details of the deadly attack on the u.s. consulate in benghazi, libya. undersiege for hours with the diplomats inside, ultimately left to fend for themselves. and everyone likes 50% more [ russian accent ] rubles. eh, eheh, eh, eh. [ brooklyn accent ] 50% more simoleons. [ western accent ] 50% more sawbucks. ♪ [ maine accent ] 50% more clams. it's a lobster, either way. [ male announcer ] the capital one cash rewards card.

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not just cairo and libya, demonstrations have been reported in sedan, tunisia, morocco, look at these pictures. these are coming in from cairo right now.

these are live pictures not far from the united states embassy. only hours away from friday morning prayers. >> with friday morning prayers just hours away, concerns that larger and more violent protests are on their way. let's get more on this with cnn national security contributor fran townsend she is a member of the external advisory committee and last month just visited libya with her employer. thanks for coming in, again. when you list off the countries we just did in the region that are seeing protests, are you surprised with the sheer number of protests that are breaking out? >> i think a couple of things worth remarking about. first of all, as ben wedemen told us, the notion of the protests in cairo have been persistent over three days. even if they're not as large is concerning. second, i think the american government was anticipate aing that after friday prayers there might be protests around the world. the notion that it didn't wait for friday. all these protests today,

thursday, going into friday. lastly, you have to look at countries with large muslim populations. like jakarta. you could see massive protests outside our embassies and consulates around the world especially after prayers in this country. >> you see the reports in benghazi at the u.s. diplomatic mission, there consulate that the libyan guards, the forces designed to supposedly protect the americans, the four americans were killed. they didn't do their job. they melted away abandoning their posts. >> in your interview with senator dianne feinstein, she heard something i had heard. there were libyan guards that were killed and libyan nationals trying to help the ambassador, who was tragically killed there at the consulate. so, there are examples of real libyan heroism. the minister of interior at the time of the bombing of the shrines did pull his forces off, said he didn't want anybody to

be killed over a monumentp. it's possible they either melted away or got pulled off. consistent with what we've seen in libya recently. >> very worrisomworrisome. >> i cover capitol hill as my day job. i want to get your take. on capitol hill senator rand paul tried to force a poll to pull funding for various countries. pakistan cut off aid and pakistan, egypt and we are hearing some people say why are we giving this money, this aid to these countries when these protests are breaking out. what is your take on it? >> it is a problem to lump these three countries together. first of all, these three countries are very different. libya and libyan people have been very supportive of the united states. when i was there, as you mentioned, every meeting i was at, these are private meetings with government officials, they wanted to thank the american government and the american people for supporting their fight for freedom. libya is a different case. they lack capability and they want our support and training and assistance but libya is

different. when we're on a brink of real success story would be tragic. in egypt and pakistan, that's quite different. in agencies of those governments that have not been supportive of the united states, despite massive amounts of aid and then the type of aid you give. you may decide you want to pull back on military aid or security assistance, but you probably don't want to pull back on hu n humanitarian aid. there was the earthquake in pakistan. we gave millions of dollars of aid to the pakistani people. that is the sort of type of aid, but it is a huge return on investment when you try to convince people that what the united states engages is not an assault on islam. the sort of thing you see in this movie, which does not represent americans or american policy, you're trying to have sort of establish a credibility with the people of those countries. you want to continue humanitarian. >> although you appreciate it it's going to be a lot more unpopular at a time of economic distress in the united states waving a $1 billion in debt that

egyptians owe the united states as the u.s. did last week or providing $1.5 billion a year for military and economic assistance to egypt if, if the new muslim-brotherhood led government doesn't cooperate with the united states. doesn't honor its commitments to the u.s. and peace treaty with israel. politically, that's going to be a really difficult to appropriate that kind of money. >> that's right, wolf. that is the aid that should be on the table. we ought to be looking at whether that is the kind of thing we want to do. what i'm talking about, the people-to-people on a humanitarian level, that is the sort of stuff you might consider continuing. the sorts of aid you're talking about, are all things that ought to be on the table. if the government doesn't protect our establishments and doesn't engage with the u.s. on important policy, we ought to reconsider that. >> thanks very much. >> thanks. there is a new warning that has just been released by the fbi and the homeland security department. it's related to the unrest

that's unfolding in north africa and the middle east. we have details, that's next. [music] see life in the best light. transitions® lenses automatically filter just the right amount of light. so you see everything the way it's meant to be seen. experience life well lit, ask for transitions adaptive lenses.

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a new warning just coming in to cnn from the u.s. intelligence community. our pentagon correspondent chris lawrence has the details. what are you learning, chris? >> carol obtained this joint intelligence bulletin within the last hour or so. it's basically put out by the fbi and the department of homeland security and it's raising the warning for the chance of possible extremist activity here in the united states due to the ongoing

publication of this movie that is out there that has caused so much unrest in the middle east. what this bulletin is saying is that it is warning some of the religious groups here in the united states that as this movie becomes more and more publicized, it could raise the profile of some of the religious groups that are associated with it and make them targets for extremists right here in the united states. we know the filmmaker has said his movie was financed by about 100 jewish people, that it's been publicized by a christian minister, as well. what the bulletin is saying is that those communities may want to take extra precautions going forward. some of the precautions that the bulletin recommends is perhaps having a more distant between where their congregation mekong g

and putting more space where vehicles can go and where some of the congregation is coming into. also, to get in touch with local law enforcement and establish a communication plan and go over their own internal building security just to be on the safe side. the building raises the possibility that there could be some montanious demonstrations. protests that come out of no where that could overwhelm the normal security procedures that a lot of religious groups have in place already,wolf. >> a lot of mystery surrounding the filmmaker and the people behind it. it's very, very unclear, chris, right now. chris lawrence with the latest on that because the public comments that the supposed filmmaker and the backers are made and all sorts of questions about whether they're accurate or bluster or whatever. we're continuing our investigation. >> there's still that ongoing investigation into this person. >> excellent, excellent point, thank you. for months, it was the economy and now a september surprise. the focus of the presidential campaign suddenly shifts to

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here's part of what the president said. >> we see on our televisions that there's no threats in the world and we've got to remain vigilant. that's why we had to be relentless in pursuing those who attacked us this week. that's also why so long as i'm commander in chief, we will sustain the strongest military the world has ever known. >> mitt romney was also talking about the military as he campaigned just outside washington today in fairfax, virginia. listen to this. >> if i'm president of the united states, we will restore our military commitment and keep america the strongest military in the world. the world needs american leadership, the middle east needs american leadership and i intend to be a president that provides the leadership that america respects and will keep us admired throughout the world. >> let's bring in our chief political analyst gloria borger and candy crowley and john king.

did you sense, john, that mitt romney was toning down the direct criticism of the president of the protests and the deadly one in libya? >> he is toning down. the statement issued by the embassy in cairo and the president is the president for the united states, expressed sympathy for the attackers. didn't do that. didn't talk about wish the people produced the movie. i do think he is dialing back a little bit, but he won't dial back completely because he did an interview with george stephanopoulos. over the last several days, you talked to lot of strategists in both parties who said he shouldn't have said what he said in the beginning. if this is a blunder, it will be a blunder in 72 hours. wait, don't jump in for the first day. >> what do you think this meant for the president? he is answering larger foreign policy issues, especially relating to the relationship with egypt and listen to this sound bite, this interview he gave with telemundo.

>> would you consider it an ally of the united states? >> i don't think that we would consider them an ally, but we don't consider them an enemy. they are a new government that is trying to find its way. if they take actions that indicate they're not taking those responsibilities, as all other countries do where we have embassies, i think that is going to be a real big problem. >> the state department today seemed to have a really different take -- >> allies or no ally. state department said ally. >> is it a blunder for him? >> i think mitt romney did the president a big favor because the real issue on the table is the question of our relationship with egypt and, instead, wroer we're talking about this state department cable and whether mitt romney had a blunder in issuing a response too quickly before he knew that the ambassador was dead, et cetera, et cetera. i think what the president has is a question of our relationship with egypt, there's a billion dollar loan

forgiveness plan on the table right now that the congress can veto if it wants to for egypt. this will clearly become a political football now and it's something the president is going to have to deal with and mitt romney is sort of established this little side show here that takes everybody's eye off the big problem, which is our relationship with egypt. >> i will say i think the bigger problem, the larger problem in u.s. relations and a lot of countries in the middle east continues. in a way that mitt romney's statement will not. i mean, it will be brought up, but every day, what have we seen? well, this is our third day, second day, but in any case, this is an ongoing problem in the middle east and brings up a lot of different issues. i think you almost, in some ways, give him a pass about the state department because the state department was an ally with a very different egypt. a different guy was running the place. but i just think the ongoing problem that is clearly out there in the middle east is more of a problem for president obama

than for mitt romney. >> years ago egypt was designated, like a lot of countries including israel, a nonally in the state department. today the state department is a major nonnato ally -- >> we don't have a mutual defense treaty, fine. >> it's not a nato ally, but a major nonnato ally. let's get to these new polls. new polls coming in, john. i want you to tell us our viewers. three battleground states, florida, virginia and ohio right now and the numbers are pretty encouraging to the president. >> these are the new nbc marest i believe "wall street journal" cooperating with them. florida five-point lead for the president. that's a lead for the president going in. virginia, what order we're going to put them up. there you see five points, exactly the same numbers. 49, 44. and then you go to ohio, the president's lead here in this poll, they show the president's lead as seven points. i would say another poll out today that shows ohio a dead heat and colorado a dead heat.

>> those are likely voters. what does this tell you? one of the interesting things about this race is that the president has been plus two in those states we just mentioned, virginia, ohio, he has been plus two. now he has some balance at the convention and maybe he's plus four or five and within the margin of air aer and doesn't mean they're insurmountable but after all the republican primary, this has been a constant and, again, tells you that the president has a slight advantage in a very close race and the debates, the debates. ms. crawley, hello, going to be incredibly important to this race. >> if you look at the way mitt romney can get to victory in the electoral college, his problem is that he's got to win these three states. these there's, barack obama can lose these three states by the way, and still win in the electoral college. so, these are must-wins. if you look at the state of ohio, which seems to be the most problematic for the president, that, that's a real problem,

which is why the president's visited there like 11 times and romney 17 times. >> all be paying taxes in ohio. >> exactly. combining kind of the two topics. do you think foreign policy now becomes a longer standing issue in, not in the election will be a bigger issue in the debates or quickly turn back to the economy? >> i think it depends on what happens. i think it's always going to be the economy. the economy is the base of this election. but if we continue to see the sorts of scenes that we're seeing from the air ab spring turning into a very uncertain fall, i think then it becomes more important, but it's still going to be about the jobs and the economy. >> i would argue that every minute that mitt romney is not talking about the economy is a wasted minute for mitt romney. >> but don't you think he always has that opportunity to kind of fill that gap of having those foreign policy jobs and meeting that commander in chief -- >> even if you are right, even if you are a challenge and you're right in the foreign

policy argument, the president has the mega phone. mitt romney should focus on jobs, jobs and jobs and if these foreign action as, these foreign incidents, whatever you want to call them, if they undermine the president, they undermine the president. if somehow his leadership, if his leadership is called into question and people see him as less of a leader, that will affect him on the domestic issues, but the events will take care of themselves. >> if you're mitt romney, you don't want to shift the conversation on foreign policy. >> in the end if obama carries ohio i think it will be because he saved general motors and chrysler and so many jobs in ohio, directly if not indirectly related to the -- >> unemployment is 7.2% in ohio, which is a point less than it is nationally. that is important. >> a ten-point lead. to the same point in michigan ten points and ohio is the second. >> clearly they thought that at the convention because if i heard ohio and michigan one more time and, you know, the bailout

of the auto industry, i mean, they clearly think. >> looks like the romney campaign and not the super pacs. >> they cannot. they can't get there without ohio. they just can't. >> we'll continue to follow it. thank you, all of you. it is a case that is as dangerous as it is complicated. how the fbi is investigating the attack that killed the united states ambassador to libya. that's next.

we're learning new details about a special fbi team that is being designed to investigate the killings to the u.s. ambassador and three other americans. joe johns is here. he's working the story. what are you finding out? >> wolf, the fbi has opened an investigation and they're going

to have to work closely with the libyan government, but one of the big concerns right now is making sure americans who go to libya to investigate this case can, themselves, be protected from harm. the president has said he wants to catch the killers of u.s. envoy christopher stevens and three other americans in libya. >> make no mistake, justice will be done. >> that message was echoed by attorney general eric holder traveling in qatar. he is cutting his trip short to manage the investigation, which is a maze of questions right now. >> we are very cautious about drawing any conclusions with regard to who the perpetrators were, what their motivations were, whether it was premeditated and whether they had any external contacts. >> reporter: a team of fbi agents headquartered in new york city is a sign to the libya investigation, but their plans are unknown or being kept quiet, possibly out of concern for their safety.

tom fuetes is a top fbi official who supervised agents overseas. >> well, the issue is when you send agents and technicians to the scene to benghazi, in this case, are they going to be safe? they are going to be adequate protection just setting up a perimeter around their work space or their crime scene to protect them from being attacked once they get there. you could have an additional attack just like the consulate attack. >> investigating attacks on americans abroad is a time tested process. >> the fbi always becomes involved when americans, official americans are killed. >> to name a few, 1996, the bombings of cobar towers in saudi arabia, 1998, the u.s. embassy bombings in africa and in 2000, the attack on the navy warship the "uss cole." u.s. officials wouldn't comment on the significance of the arrest made by libyan authorities. fuentes says the first question is whether certain people were taken into custody because they

may know something as a opposed to have done something. >> arrests could be made just for investigative purposes. many of the countries here, usually in the united states the threshold of arresting someone is usually higher than foreign countries. many of these countries, if they're suspicious of somebody, they could bring them in for questioning. >> a lot of touchy questions here, including whether any suspect charged with participating in the embassy attack would be put on trial in the united states or in libya. that is a big unknown. it's the kind of thing diplomats would have to negotiate a, preferably in advance of any charges. >> i think they want to see what the libyan government can do. >> that's right, absolutely. >> thanks very much, joe. as we watch the growing violence across the muslim world, erin burnett is talking with a senator who wants the united states erin, tell us more. >> senator rand paul and he wants the u.s. to take drastic action and cut off all funding to egypt, pakistan on his list.

there was a very heated exchange between he and john kerry on the floor today when they fought about this. we're going to be talking to the senator about why he wants to cut the aid and why he thinks that would make sense. another person who strongly disagrees with him is senator john mccain. we'll get to the bottom of that whether it makes sense for this country to do that. wolf, i was speaking to christians today in egypt and they're very afraid about what could happen to them if the movie prophet mohammed was a christian. as things spread throughout the middle east, we're live throughout the region. all that coming up at the top of the hour. >> like his father, ron paul, the congressman, they have both opposed foreign aid long before this. they opposed foreign aid for a long, long time. >> it's true. one place, wolf, he said he would keep his foreign aid and we'll tell you where that is, as well. >> he even said during the campaign that he wouldn't even support foreign aid for israel, which, obviously, is a major

u.s. ally right there. >> you're going to have to watch tonight then. >> see what he says about that, if he's changed his mind. thanks very much. more than a dozen aliases and made an amateur movie and that's fueling anti-american rage. we'll show you what our investigation has uncovered. so... [ gasps ]

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mitt romney has acted to recriticism to president obama that says his rival shoots first, ami aims later put out be u.s. embassy in cairo. here's what romney just told abc news. >> what i said was exactly the same conclusion the white house reached, which was that the statement was inappropriate. that's why they backed away from

it, as well. >> they didn't say it was showing sympathy for the attackers. >> i think it was not directly applicable and appropriate for the setting. i think it should have been taken down and, apparently, the white house felt the same way. >> when the president said you shoot and then aim later. >> this is politics, i'm not going to worry about the politi. >> the protests in almost a dozen countries started because of an amateur movie. we're learning more about the movie maker. cnn miguel marquez is investigating this for you. you uncovered his criminal record. what's his background? >> reporter: well he has quite a background. in 1991, sam bacile or what we believe is his real name -- was convicted of two misdeamnors. in 1997 he was convicted on charges of intent to manufacture methamphetamine. he served a year in prison for that. in 2010 he was convicted of

fraud. the fraud was a very complex fraud where he was creating different identity, different social security numbers then using those credit card convenience checks to draw money on fake accounts and then disappear. he got out in 2011 and that's when he began movies. >> what else has your reporting turned up? >> reporter: it's stunning. 17 different names so far we have turned up. i'll read just a few of them. not only sam bacile, but any could basili. p.j. tobacco among all of those 17 names that this guy has used. he had different social security cards when investigators went in to serve warrants. he had documents from birth certificates to drivers licenses to passports all with different names. this guy was deeply involved in

fraudulent activity both creating false identities with their own credit history and then using that credit history in order to deposit money into accounts which he would withdraw with an atm and then disappear. >> it's mazing to me this low budget anti-islamic film has had such a global impact. are people connected with the making of this film talking today? >> reporter: it's interesting. they were talking yesterday and today things have shut down quite a bit. they are still saying in statements, paper statements they disassociate themselves from the film. if they knew it would turn out what it was they would never have taken part. they are not speaking out as much even. steve kline who said he was a consultant on the film said he's being contacted by authorities, by fbi, that he's concerned for the safety of others and doesn't want to speak out.

everybody seems to have taken on board just how massive a ripple in the world this film has created, and is beginning to quiet down and take this very seriously, wolf. >> thanks very much. kate bolduan is watching some other stories. >> reporter: thursday we want to show some live pictures coming out of cairo, egypt. as we've been following this protest that's gone on throughout the day and into the night these protests and live pictures continue. looks like they are setting off fireworks. >> it's escalating and will continue escalate, kate, as we get closer and closer to the friday morning prayers. right now it's approaching 2:00 a.m. over there in cairo, by 5:00 a.m. it's really going to be daylight and that's when things could get even more intense. >> reporter: we'll continue to watch that. i want to bring you some other top stories. fed chairman ben bernanke

announced plans to unleash more stimulus to boost the u.s. economy. fed will bi$40 billion of mortgage backed securities every month. it should lower long term interest rates and the fed hopes i want leads to more spending. traders liked it. the dow ended up more than 200 points. some potential good news in chicago. there's new hope chicago teachers could be back in the classroom soon. union delegates with the power to end their strike plan to meet tomorrow. today is the fourth day that public schools have been closed for 350,000 students there. both sides said they made progress in late night talks. the union has said they have been far from a deal on teacher evaluations, benefits and other issues but possibly some progress there. and washington's national cathedral was packed for today's memorial service honoring neil armstrong who died last month. among those paying tribute to the first man to walk on the moon was the last man who walked on its surface.

listen here. >> no one, no one but no one could have accepted the responsibility of his remarkable accomplishment with more dignity and more grace than neil armstrong. he embodied all that is good and all that is great about america. >> reporter: one of the national cathedral's windows contain a moon rock presented years ago by armstrong. you see a shot of it. by armstrong and his crew. it's the back dot in the tiny white circle you see there but a very moving memorial for him, for him today. >> we're getting new information about the men killed on, in that attack on the u.s. consulate in libya. we'll have that next.

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in libya along with the united states ambassador chris steven's have been identified. sean smith was a husband and father of two. he was on a short term assignment in libya. glenn dougherty was a former navy s.e.a.l.. he was work forge a security contractor in libya. his sister paid tribute to him today. >> our family would like to thank everyone for their love and support. glenn lived his life to the fullest. he was my brother but if you ask his friends he was their brother as well. we ask for privacy during this time as we grieve for our friend, my brother, our brother, our son and our american