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As Stocks Rally Trump Blames Fed for Volatility & Initial Drop; Mnuchin Plans to Attend Summit in Saudi Arabia Despite Missing Journalist Allegations; Trump's Legal Team Prepares to Answer Written Answers to Mueller; Georgia Democrat Stacey Abrams Calls on Brian Kemp to Resign; Pope Accepts Resignation of Archbishop Accused of Covering Up Sexual Abuse Allegations. Aired 11:30-12p ET

Aired October 12, 2018 - 11:30   ET

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


(BEGIN VIDEO CLIP)

[11:30:00] DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I think the Fed is making a mistake. They're so tight. I think the Fed has gone crazy. I really disagree with what the Fed is doing.

(END VIDEO CLIP)

KATE BOLDUAN, CNN ANCHOR: CNN senior economic analyst, Stephen Moore, joins me now. He's a former economic adviser for the Trump campaign.

Stephen, what is going on this week in the market?

STEPHEN MOORE, CNN SENIOR ECONOMIC ANALYST: Well, panic. Panic selling. You know, every time the Fed raises interest rates, as it announced it was going to do last week, there's this fear and panic and people start selling stock. Although the pattern has been, you know, the market falls and then it drifts back to where it was.

Look, I'm not a stock picker. I'm not a sage when it comes to the stock market, but one mistake, I'm getting calls, should I get out of my 401(K) plan?

(CROSSTALK)

BOLDUAN: First, don't listen to Stephen Moore.

MOORE: But the one piece of advice I can give that I think is good advice, people tend to sell low and buy high rather than the opposite, right? And so now is not a great time to sell your stock because, you know, the prices are pretty low right now. Just, if you're in for the long term, if you're in like a 401(K) or retirement plan and in for 10, 20 years, let it ride. Over time, the market is going to go up.

BOLDUAN: This is one question, what to do. Even before then, the why? Why is this happening?

(CROSSTALK)

MOORE: Why. We're still scratching our head and trying to figure it out. The Fed tightened, but that wouldn't account for a 1300-point decline.

BOLDUAN: Donald Trump is making that connection.

(CROSSTALK)

MOORE: He likes low interest rates.

BOLDUAN: Everyone likes low interest rates.

(CROSSTALK)

MOORE: Pardon.

(CROSSTALK)

MOORE: He's always complaining about the Fed raising rates.

BOLDUAN: Does it help when he takes it on publicly?

MOORE: It's kind of fuming a little bit. But I happen to think that Trump is a little bit right here, that every time the economy really does well, and as you know, the one thing the Fed is worried about is we have the lowest unemployment rate in 30 years, they're worried that's going to drive up wages. But you know what, Kate? We want higher wages. My complaint about the Fed is, every time wages for middle-class workers who haven't had a wage increase in 20 years, if every time we have a wage increase, they want to snuff it out by raising interest rates, then how are we going to get middle-class workers better off?

I think the big worry that a lot of investors are having, not that they raised rates now but they said we're going to continue and raise them and raise them. This is simple investing. When interest rates go up, bonds are more attractive, stocks are less attractive, stocks are less attractive.

BOLDUAN: When -- smarter folks than I are saying the trade war --

(CROSSTALK)

MOORE: That partly contributed to this.

BOLDUAN: Trade war is part of this.

MOORE: Yes.

BOLDUAN: Does this give you a signal that the United States is not winning this trade war?

MOORE: That's mystifying, too. Look, we got a big -- I think what happened, what was it, a week ago Monday when Trump announced this deal with Canada and Mexico, that was kind of a breakthrough. We're going to have a renewed NAFTA. We don't call it NAFTA any longer, but a renewed free trade agreement.

The big deal right now is China. Are we going to get this deal done with China? Right now, I don't think they're anywhere. And I don't see Trump backing down. There's some fear that we may have a protracted trade war with China.

BOLDUAN: Which has a lot more riding on it when Trump meets with Xi Jinping at the G-20.

MOORE: That's true. He was funny at that press conference. He said I put my arm around President Xi and I said, President Xi, you know you're cheating. Quintessential Trump.

But I'll make this prediction, Trump isn't going to back down. And China is going to have to make concessions because they have abusive trade practices we can't live with any longer.

BOLDUAN: Let me ask you, related, different. Treasury Secretary Steve Mnuchin told CNBS he's still planning to attend the summit next week, the Future Investment Summit -- Initiative Summit in Riyadh, in Saudi Arabia. This is coming up because of the concerns and the mystery over the journalist who has gone missing in the Saudi consulate in Istanbul. Do you think -- companies are pulling out, CNN pulled out of being a sponsor of the summit, others have as well. Do you think the treasury secretary should be heading over at this time?

MOORE: I can't answer that. But you do remind me of something when you mention Saudi Arabia. The other thing going on right now is high oil prices. I don't know if you have been to the gas pump lately, but they're rising. I paid $3.89 a gallon the other day. That's also a negative for the economy. Any time the oil price rises, it's like a tax on the American economy.

BOLDUAN: Don't dismiss this, though. When you were advising the Trump campaign, if you were advising the president now, is it smart to send his treasury secretary over there?

(CROSSTALK)

MOORE: I don't have an opinion one way or the other.

BOLDUAN: OK.

MOORE: But I'm still bullish on the U.S. economy and on the stock market. I think if you're in it for the long term, don't pull out. Don't pull out.

BOLDUAN: Stephen, thank you so much. Great to see you.

MOORE: Thank you.

[11:34:50] BOLDUAN: Next for us, after months of negotiations, Special Counsel Robert Mueller may finally get answers from President Trump. So what does Mueller want to know? And what will President Trump tell him? CNN's exclusive report is next.

(COMMERCIAL BREAK)

BOLDUAN: A big development in the Russia investigation. CNN is reporting. after months and months of negotiations, President Trump's legal team is preparing answers to written questions providing by Special Counsel Robert Mueller. Sources say the questions are focused on, and here's how they describe it, "Matters related to the investigation of possible collusion between Trump associates and Russians seeking to meddle in the 2016 election."

Joining me now, CNN legal analyst, Michael Zeldin, former assistant to Robert Mueller at the Justice Department and a former federal prosecutor.

Michael, so they're preparing answers to the questions. What exactly does that mean? Are they like sitting down with the president, pencil to paper at this moment?

[11:40:18] MICHAEL ZELDIN, CNN LEGAL ANALYST: So I think there's a two-step process here. First is, they receive the questions and they, the lawyers, Jane and Marty Raskin, and perhaps Jay Sekulow, are crafting answers based on the documentation that they have already sent to Mueller to make sure that which they sent and the answers to the questions are consistent. Once they have clear answers to the distinct questions, then I think they go to the president, because these are his statements, so he's going to be bound by them. So they'll need to make sure that the president is comfortable with what's being said. Once that's all said and done, they'll send them back to Mueller, and Mueller will review them to determine whether or not there are follow-up questions that need to be asked, new topics that need to be asked, or whether or not he's good with this, and moves on to the next area.

BOLDUAN: I mean, that is actually, I think, an important question. After they send the answers back, what do you think then happens next? I don't know if there's a typical case, but is there a lot of back and forth, or is this the one shot of getting the answers to these questions?

ZELDIN: We don't know what the terms of the deal that the Raskins and Sekulow struck with Mueller and his team. But in ordinary litigation, you have what they call written interrogatories, these written questions, and there are a first set, a second set, third set. So oftentimes, there's an iterative process in the ordinary course. We just don't know what the deal is. I can't imagine Mueller said, one and done is fine with us. I think he wants to see the answers he gets because he's made a concession to allow the written questions at the outset, instead of requiring or seeking an oral answer to questions.

BOLDUAN: Michael, does this at all indicate where the special counsel is in terms of a timeline of the investigation, nearing the end at all?

ZELDIN: I think we could probably conclude that going at this point, you know, for the president's questions means he's closer to the end than to the beginning. But he still has a lot of information to take in from the cooperators, Manafort, Gates, Flynn. So he's going to have to measure what he gets from the president and the answers to the written questions against that which he's learned from those witnesses to determine whether he's now able to say, I have a conclusion that I can reach or whether he has to do further investigation. So we don't know, Kate, but, typically, you reserve, toward the end of your special counsel investigation, questions of the president himself.

BOLDUAN: All right. Great to see you, Michael. Thank you.

ZELDIN: Thank you.

BOLDUAN: Coming up for us, serious allegations being made in one of the most closely watched governor's races in the country right now. Why the Democratic candidate in Georgia wants her opponent to step down from his current job.

(COMMERCIAL BREAK)

[11:47:34] BOLDUAN: A Democrat hasn't won the Georgia governor's mansion in nearly 20 years. But this year, Democrats think Stacey Abrams is the one to do it. But she says she's been held back by the state's top election official, accusing him of using his office to suppress voter turnout. The big twist is that official, Brian Kemp, is her opponent. Abrams is now calling on Kemp to resign.

CNN correspondent, Jessica Dean, is here to take a closer look at this high-profile race.

Jessica, these are serious allegations in this race. What's going on here?

JESSICA DEAN, CNN WASHINGTON CORRESPONDENT: Well, Kate, imagine you show up at the polls on Election Day only to learn that your registration is on hold, simply because there was a typo. You're still allowed to vote, but now there's this extra step involved, and there's concern that some voters will simply go home or not show up at all.

(BEGIN VIDEOTAPE)

DEAN (voice-over): A major dust-up at the state of Georgia weeks before voters go to the polls to choose their governor. The latest point of contention, allegations Georgia's Secretary of State Brian Kemp is using a voter verification law to effectively suppress thousands of African-American voters.

(CHANTING)

DEAN: Kemp is running on the Republican ticket against Democrat Stacey Abrams.

STACEY ABRAMS, (D), GEORGIA GUBERNATORIAL CANDIDATE: Now let's go get it done.

(CHEERING)

DEAN: In the latest twist, a nonprofit advocacy group has filed a lawsuit against Kemp in his official capacity as secretary of state. This, after reports that Kemp's office placed a hold on more than 50,000 voter applications, more than two-thirds of which were made by African-Americans, for not meeting an exact match requirement. This means anything as minor as a typo or missing hyphen between a valid I.D. and a voter registration can be flagged.

UNIDENTIFIED FEMALE: The reality is that minority voters are often the ones with unusual names that are sometimes harder for state officials to capture accurately in the state's database, and they are being penalized for that. Our end goal, our end objective with this lawsuit is making sure that there's a level playing field where everyone's voice can be heard in Georgia.

[11:49:41] DEAN: The Kemp campaign calls the claims bogus and points to Georgia increasing its voter rolls under his leadership. Quote, 'Under my tenure as secretary of state, Georgia has shattered records for voter registration and turn out across all demographic groups. Despite any claim to the contrary, it's never has been easier to vote in Georgia and actively engage in the electoral process."

The Abrams campaign said Kemp is using his authority as secretary of state to boost his chances, saying in a statement, quote, "This is not incompetence. It's malpractice. Brian Kemp needs to resign so that Georgia voters can have confidence that their secretary of state competently and impartially oversees this election".

The Kemp campaign denounces the accusations as a, quote, "sad campaign tactic," and said Abrams is up to dirty tricks, calling it this whole thing a, quote, "manufactured crisis" to turn out her base.

The secretary's Web site points out voters with registrations on hold can vote on Election Day if they show an acceptable form of identification, which is already required to vote in Georgia.

Kemp's team says it's this controversy itself that is suppressing the vote. Quote, "By telling people they can't vote, they actually think they can't vote. That's a sad state of affairs."

As for Abrams, she has long believed Kemp has worked to suppress the minority vote.

ABRAMS: We live in a nation that has spent centuries denying the right to vote and spent decades creating barriers to that right to vote. And I have an opponent who is a remarkable architect of voter suppression.

(END VIDEOTAPE)

DEAN: It is a very tight race in Georgia. A recent poll by the "Atlanta Journal-Constitution"/Channel 2 Action News shows Kemp with a slightly, 48 percent, to Abrams' 46 percent, within the margin of error.

And remember this as well. No one wins November 6th, Kate, unless they can crack 50 percent, otherwise, they are headed for a run off in December.

BOLDUAN: Jessica, thanks so much.

This is your first time on the show since joining the network. Good to have you. Welcome.

DEAN: Thank you for having me. Appreciate it.

BOLDUAN: We'll see you soon. Thanks.

Coming up for us, a very big development in the sexual abuse scandal in the Catholic Church. A prominent American cardinal is out. What the pope is saying about it, next.

(COMMERCIAL BREAK)

BOLDUAN: Afghan and Iraqi interpreters serving alongside U.S. troops put themselves and their families at risk every day. This week's "CNN Hero" is an Army veteran whose mission is to bring the brave people to safety. Meet Matt Zeller.

(BEGIN VIDEO CLIP)

MATT ZELLER, CNN HERO: Afghan and Iraqi translators are proud patriots who signed up to defend their country and to help us with our mission. We owe these people great debt of gratitude to feel like they have been honored for their sacrifice.

Welcome home. Welcome.

UNIDENTIFIED MALE: Thanks for everything.

ZELLER: Thank you.

We also owe them a chance at a new and better life that we promised in exchange for that service.

(END VIDEO CLIP)

[11:55:13] BOLDUAN: No kidding. See how Matt is transforming lives. Go to CNNheroes.com.

(COMMERCIAL BREAK)

BOLDUAN: One of the most-prominent cardinals in the United States becomes the latest official brought down by the sexual abuse scandal that rocked the Catholic Church. Pope Francis accepted the resignation of Donald Wuerl, the embattled archbishop of Washington. He is accused of covering up when he served as a bishop of the Pittsburgh archdiocese.

CNN's John Allen is in Rome with this very big development.

John, what does the pope's announcement say?

JOHN ALLEN, CNN SENIOR VATICAN ANALYST: What it says is that Donald Wuerl is no longer the archbishop, as of today. He remains a cardinal in good standing.

But there are two twists here, Kate. One, the pope asked Wuerl to stay on in Washington as the interim leader until his replacement is named. The other, he released a letter praising Cardinal Wuerl for the nobility of the way he handled the situation, saying he is proud of him. It seems, Kate, that Cardinal Wuerl may have lost a job, but not lost the pope's confidence.

BOLDUAN: Fascinating. What does this mean then, John, in the grand scheme of the reckoning that the Catholic Church is facing over the sexual abuse scandal? Wuerl is such a prominent figure in the Catholic Church.

ALLEN: Yes, and I suspect a lot of abuse survivors and those outraged by these scandals will not be satisfied with the way Donald Wuerl is stepping away. Particularly, the praise that the pope has shown him.

I think what it means is that, for many people, the Catholic Church's obligation to create a meaningful system of accountability for bishops who cover up the crime of child sexual abuse is a work in progress.

BOLDUAN: To say the very least.

John, thank you so much. I appreciate it. This big announcement coming today.

All right, everyone, we are at the end of this week together, but it's not over yet. You have to stick around for one very important reason. Dana Bash is here for "INSIDE POLITICS" and that starts right now.

[12:00:13] DANA BASH, CNN HOST: Thank you for joining us on INSIDE POLITICS.