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Dow Rebounds After Losing 1400 Points; Trump's Legal Team Prepares to Answer Written Answers to Mueller; Melania Trump Gets Candid About Her Marriage in ABC Interview. Aired 1:30-2p ET

Aired October 12, 2018 - 13:30   ET

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

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[13:31:32] WOLF BLITZER, CNN HOST: More volatility on Wall Street today. The Dow is up 61 points. It's sort of rebounding after losing almost 1400 points over the last two days.

CNN's Alison Kosik over at the New York Stock Exchange.

Alison, stocks have been on a roller coaster ride today. What's behind the volatility?

ALISON KOSIK, CNN CORRESPONDENT: They have. If you look at the board, the Dow is up 71 points, and that's pretty good after the Dow losing over 1,000 points. To stay at the point, where you see the Dow up -- it's been all over the place. We saw the Dow up over 400 points and then into the negative, wiping out all of the gains. It's anyone's guess where it will end up.

Investors are trying to figure out how to trade in this environment because the underlying issues that caused that massive sell off over two days, the underlying issues that triggered that sell off, they still remain. I'm talking about higher interest rates. The Fed is on track to raise interest rates another time this year and continue through the rest of next year. We're also watching the 10-year treasury bonds. The interest on yields is moving higher at this moment.

And the trade talks ongoing between China and the U.S. There's still uncertainty. The concern is if the tariffs remain in place, they could raise costs for companies and cut into profits.

The good news is President Xi of China and President Trump are expected to meet at the G-20 summit next month. That did give positivity to the market earlier but doesn't look like it's keeping that bounce going.

As far as the other issues weighing on the market, we have the slowing housing market happening at time when we see mortgage rates at levels we haven't seen in years. And we also have higher oil prices. You have all of these things continuing to happen.

Whether you see the green on the screen, the underlying issues will continue to cause volatility. All of the issues are not going away any time soon -- Wolf? BLITZER: We will see what happens in the next two and a half hours as

the markets continue to deal with this.

Alison, thank you very much.

Coming up, after months at the negotiating table, President Trump's lawyers are preparing answers to the special counsel's questions, signaling the investigation may be in its final phase.

Plus, when asked about her marriage, the first lady responds, quote, "We're fine." She also weighs in on her husband's alleged infidelity. We have details.

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[13:38:31] BLITZER: Questions and answers. After more than a year of negotiations, the Special Counsel Robert Mueller's team will get to question President Trump on possible collusion between the Trump campaign and Russia. Written questions. Only written questions were submitted to the president's legal team who are right now preparing written answers. The Q&A will all be in the form of written questions and answers.

Joining us now, our CNN legal analysts, Michael Zeldin and Carrie Cordero.

Thanks very much for joining us.

Just to be precise, it only involves these questions. This is what the Trump legal team agreed to. Questions of what happened during the campaign about alleged collusion or conspiracy to deal with Russians interfering in the election and all of that. It doesn't deal with what happened after the president took office and nothing to do with obstruction of justice and the firing of Comey, for example.

CARRIE CORDERO, CNN LEGAL ANALYST: The president's legal team has been successful in delaying this process and let this process really take a long course. Here we are at almost two years into his administration and they are just about to maybe answer questions about this in writing which, of course, was always their desire. They don't want him to have to testify in person. I don't think at least.

BLITZER: Of course, they don't want him to testify in person.

It's not totally unprecedented that the president will have written Q&A.

[13:39:59] MICHAEL ZELDIN, CNN LEGAL ANALYST: It's what happened in Iran/Contra with Ronald Reagan.

(CROSSTALK)

BLITZER: Yes.

ZELDIN: But what we have here most probably is phase one. Phase one is pre-inauguration. That topic is collusion or what we call conspiracy and coordination. Then, I think, Mueller will review the answers and determine if there needs to be follow-up questions on that topic. And then the issue needs to be joined about post-election or inauguration and that involves more topics, Wolf, like the firing of Comey and obstruction of justice.

BLITZER: Carrie, given the ground rules of what they agreed to, only written questions on what happened before inauguration, what do you think are the top questions Mueller's team is seeking answers to?

CORDERO: One of the big ones is the Trump Tower meeting the senior Trump campaign officials attended with Russian government affiliated individuals where the topic of it kept changing in terms of what had been what the Trump folks said it was about and whether or not Donald Trump knew about that meeting in advance. That is one documented particular event that we know was an in-person meeting in the campaign. That's a major issue.

The other question I think is important is, why was the president, during his 2016 campaign events, constantly talking about Russia and WikiLeaks and looking into Hillary Clinton's e-mails. Those are issues that pertain to potential collusion that the special counsel's office wants to know about, what was motivating Donald Trump.

BLITZER: Those are important questions.

What questions do you think Robert Mueller's team submitted?

ZELDIN: Well, those are probably the top two. Wikileaks really is hacking. We understand it's communications with Wikileaks, and what do we know about the hack of the DNC and Podesta.

I think they'll also want to know the allegations of reaching out by Trump campaign officials like to Ambassador Kislyak and others. A lot of allegations about Flynn, Papadopoulos, Carter Page, Sessions and their reaching out to Russians during critical stages of the campaign. That will be a broad topic of conversation as well.

BLITZER: What does it say to you that they submitted written questions to the president of the United States. Is it suggesting this investigation is coming to a close?

CORDERO: They have been negotiating this for so many months now. He was the head of the campaign. He was the candidate. Getting his answers to some of these questions really is critical to the investigation. They can conclude it perhaps without these answers, but the conclusions that the prosecutors are able to draw will be much stronger if they do have input. And this particular issue seems to be one that the president's legal team feels more comfortable about Donald Trump's specific answers. I think they are putting a little bit of distance between him and the campaign, perhaps more generally.

BLITZER: You know the legal team is preparing the answers to all of these.

CORDERO: Right. ZELDIN: Right. And one of the issues, Carrie, about this is, in this pre-inauguration period, there's no executive privilege. They were in a much more difficult position, Marty and Jane Raskin, who are working on this, to resist those --

BLITZER: Part of the Giuliani team.

ZELDIN: Correct -- to resist questions around this. Then we will have to see when executive privilege comes into play after inauguration and whether they have a similar ability to resist or request, by Mueller, if there is one, for oral testimony.

BLITZER: Yes. I suspect these questions are only just the beginning. We will see if the president is ready to answer the other questions, either in written form, if that's OK with Mueller, or in a face-to- face meeting.

Guys, thank you very, very much.

Coming up, the first lady of the United States sounds off. Melania Trump is speaking out on her husband's alleged affairs. Calling them not a concern for her.

[13:44:03] Plus, we'll take you back to Mexico Beach, Florida, which is being described as a war zone after Hurricane Michael. Residents are returning to their homes to see what's left. CNN is on the ground with that.

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BLITZER: This just in, A brand-new CNN poll shows the first lady Melania Trump's favorability is moving higher. Her favorability now stands at 54 percent, up from 51 percent from a similar poll back in June. Mrs. Trump recently returned from a trip to Africa, her first foreign solo trip as first lady.

While overseas, she did speak with ABC about her time as first lady and got candid about her marriage.

(BEGIN VIDEO CLIP)

UNIDENTIFIED ABC NEWS CORRESPONDENT: You're not the first first lady to have to deal with her husband's alleged infidelities. Has this put a strange on your marriage?

MELANIA TRUMP, FIRST LADY OF THE UNITED STATES: It is not a concern and focus or concern of mine. I'm a mother and a first lady. I have much more important things think about and to do. I know people like to speculate and media likes to speculate about our marriage.

UNIDENTIFIED ABC NEWS CORRESPONDENT: You mentioned you still have a good marriage. Do you still love your husband?

TRUMP: Yes. Yes, we're fine. Yes. It's what media speculates and gossip. It's not always correct stuff.

(END VIDEO CLIP)

BLITZER: Joining us now, our White House reporter, Kate Bennett, who traveled with the first lady to Africa.

Kate, has the first lady ever addressed questions like this before?

[13:49:54] KATE BENNETT, CNN WHITE HOUSE REPORTER: No, never. In fact, this is her first on-camera interview in a year. She's intensely private. During the peak of the salacious headline with her husband's alleged infidelity, she remained quiet. That being said, she cancelled the trip to Davos. She took a few other separate motorcades. So certainly the public could infer maybe that something strange or unusual was afoot in their marriage, but she's never commented on it.

BLITZER: What do you think of her answer?

BENNETT: It's interesting. She remains very unemotional. She doesn't lose her cool. She's maintaining that privacy.

It was interesting to me the way the country's been wrapped up in this, implications with the payoff and legal ramifications for the president. The first lady literally said she found it unpleasant to have these headlines and allegations made. She's sticking with the first lady we've seen so far, holding her cards close to her vest. It's interesting to hear her speak out and be honest and touch on these topics.

BLITZER: You traveled with her every step of the way, Ghana, Malawi, Kenya, including Egypt, where she showed up at the pyramids. She seemed to be very, very self-confident.

BENNETT: She was. When she's outside of Washington and typically when she's around children, she lights up very much. We're very used to seeing her behind the president as he walks to Marine One and her face is sort of expressionless, but she was a very different Mrs. Trump in Africa, very happy, lots of smiling and laughter. She was playing with baby elephants. Who wouldn't laugh and smile with baby elephants? But she certainly feels more comfortable, perhaps, on the global stage doing her own thing. I think that's very important to her because she is quite independent.

BLITZER: She certainly is.

We're showing videos from her trips to Africa.

Do you think she'll be doing more of these international trips?

BENNETT: We asked her that. We said, where are we headed, when is the second trip. She said, let's get home first and take stock. There will be planning for another one soon.

It's interesting she chose Africa at her first international trip alone. A country very much associated with previous modern first ladies, such as Michelle Obama, Laura Bush. Hillary Clinton made a long solo trip as first lady to Africa when she was first lady as well. She's following in that tradition.

BLITZER: There was political controversy. Her husband, the president of the United States, supposedly said some not-so-nice things about some countries in Africa.

BENNETT: Exactly. The first lady said she didn't believe those comments, she didn't hear them. She said they were from an anonymous source and not to be believed. She also said none of that was brought up during her visit. But, of course, it sort of cast a pall over this trip. Also that her husband had made some budget cuts to USAID, which she partnered with on this trip. So there were certainly some Washington implications and things going on that might have crossed over into her trip. But again, she downplayed them so they weren't an issue this time.

BLITZER: In our brand-new poll, let's dig a little bit deeper about the support for the first lady. And 83 percent favorability among Republicans, 55 percent among Independents, only 28 percent favorability with Democrats. She's struggling with Democrats right now. My suspicion is she's struggling more because she's married to Donald Trump than would normally be the case.

BENNETT: Right. Agreed. It really is a party line issue here. She has not made a strong initiative push for Be Best. People are still confused what it's about and what the focus is. There are a high number of people who doesn't have an opinion of her, which is at 14 percent, which is somewhat unusual that no one can say whether they're favorable or unfavorable. She is, Wolf, higher than the president, whose favorable remains at 41 percent in the same poll. She's a good 13 points ahead of her husband in terms of favorability.

BLITZER: And we'll see more about her internationally, right?

BENNETT: I imagine so.

BLITZER: What about domestically?

BENNETT: I think she's going to continue to roll out this program. She'll visit more schools and hospitals. I think we can see her raise her profile in the coming months.

BLITZER: And Be Best.

BENNETT: Be Best.

BLITZER: Better be best.

BENNETT: That's right.

BLITZER: Good work.

Thanks so much.

BENNETT: Thank you.

BLITZER: Just ahead, homes leveled, businesses demolished. We'll take you back to the devastation along Florida's panhandle as the search for survivors continues.

And we'll discuss the wild week in politician when Kanye West entered the Oval Office and Taylor Swift entered the midterm battle.

[13:54:34] And a Democratic candidate in Georgia's gubernatorial race is now accusing her opponent, Georgia's secretary of state, of voter suppression.

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[13:59:37] BROOKE BALDWIN, CNN ANCHOR: You are watching CNN special live coverage here, the aftermath of Hurricane Michael. I'm Brooke Baldwin.

Day two for us here in Mexico Beach, Florida, what has been referred to as ground zero. The pictures tell the story. You see for yourselves, the mattress in the tree. What you can't see, to my left, stairs that go to nowhere, missing an entire home. Talking to fire and EMS, there's a home, just behind me, where two parents and two kids rode the storm out. Their neighbors chose to do the same. There's one man that was in one of these home's behind me that is no longer. They tried to coax that man to come into their home. He never did. He hasn't been seen since.

Today, as I was here yesterday, it is different today in the sense that the cleanup has begun.