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Obama: 'Major step forward' in Iraq

President Barack Obama said the recapturing of Mosul dam in northern Iraq by Iraqi and Kurdish forces is a "major step forward" in the battle against Islamic State militants.

Speaking at the White House, Obama said Monday that if the dam on the Tigris River had been breached it could have had catastrophic consequences and endangered American Embassy personnel in Baghdad.

Obama said the U.S. is urgently providing arms and assistance to Iraqi security forces as well as Kurdish fighters as they seek to reverse the Islamic State (ISIS) fighters' recent gains.

Read MoreObama: Iraq siege broken, airstrikes to continue

The U.S. began a campaign of airstrikes in Iraq earlier this month to combat the advances of Islamic State combatants. Over the weekend, American forces conducted a round of strikes around the Mosul dam—a major strategic asset in the region.

Since then, there have been conflicting accounts from Kurdish, Iraqi, and ISIS over who currently controls over the dam.

Earlier on Monday, ISIS warned the United States that it will attack Americans "in any place" if U.S. raids hit its militants.

The group released a video showing a photograph of an American who was beheaded during the U.S. occupation of Iraq, featured a statement which said in English "we will drown all of you in blood."

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Obama also turned to domestic issues, addressing the situation in Ferguson, Missouri.

The president said that Attorney General Eric Holder will be traveling to the embattled area later this week, and that the Justice Department has opened an independent federal civil rights investigation.

Obama encouraged the community to "seek some understanding rather than simply holler at each other."

Eighteen-year-old Michael Brown died after being shot by a police officer on Aug. 9 in Ferguson—a St. Louis suburb. When initial eye-witness reports said Brown was unarmed with his hands up at the time of the fatal shooting, community protests sprung up in opposition to what some claimed was a police attempt at a cover-up.

These protests took a violent turn last week—with reports of Molotov cocktails and looting—area police responded with armored vehicles and camouflage-patterned gear, giving the appearance of a military force to many across the country.

Read MoreWhere Ferguson's 'military' police get their gear

"While I understand the passions and the anger that arrise over the death of Michael Brown, giving into the anger by looting, or carrying guns, and even attacking the police only serves to raise tensions and stir chaos," Obama said, adding that he did not want the "lines blurred" between domestic police and military as that would be "contrary to our traditions."

Obama also suggested that there may soon be a bipartisan examination of the post-Sept. 11 grants awarded to local law enforcement departments to ensure "what they're purchasing is stuff they actually need."

As tensions rose, Obama assigned Holder to investigate the incident and the police response. On Sunday, Holder authorized a secondary autopsy of Brown, because of the "extraordinary circumstances involved in this case," according to a statement.

—By CNBC staff with wires

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