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On the Story

CNN Saturday Edition

Aired October 19, 2002 - 10:00   ET

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

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


BARBARA STARR, CNN PENTAGON CORRESPONDENT: Welcome to CNN's SATURDAY EDITION, where our journalists share the inside scoop on the stories they covered this week. I'm Barbara Starr.
The Pentagon lends high-tech reconnaissance help for the search for the sniper.

PATTY DAVIS, CNN CORRESPONDENT: I'm Patty Davis.

The latest on the sniper hunt -- after two and a half weeks, nine deaths, cops are pleading for leads.

ANDREA KOPPEL, CNN STATE DEPARTMENT CORRESPONDENT: I'm Andrea Koppel.

A radioactive reminder this week from North Korea that the world is a dangerous place.

KATHLEEN HAYS, CNN FINANCIAL NEWS CORRESPONDENT: I'm Kathleen Hays.

The stock market rockets back in a way not seen since the '30s, while other economic news sends a mixed message.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: I'm Suzanne Malveaux.

The president pushes his Iraq message as he shifts into high political gear in the final weeks before the election.

We'll be talking about all these stories. CNN Sports correspondent Josie Karp will be joining us later from where game one of the World Series will be played this evening. We'll have the president's radio address at the end of the hour, but first, a check of what's making headlines right now, in Atlanta.

(NEWSBREAK)

DAVIS: The capital-area sniper has killed nine people. A law enforcement army is after the shooter or shooters, but so far, none of the leads have paid off.

And what seems to have been false information rocked investigators midweek. In fact, the man who gave that false information, Matthew Dowdy, now under arrest.

MALVEAUX: You know, what kind of person really would do something like that, though? I don't understand. What was motivation? Do they tell you -- did the police say why it was he made up the story in the first place?

DAVIS: Well, some surmise that perhaps he was looking for his 15 minutes of glory. He's an ex-con. But the information particularly damaging that he gave police. One, he actually described an olive- skinned suspect. He described a cream-colored car with a left taillight out -- very specific information. And he said this man was shouldering an AK-74. Threw police off, wasted valuable times.

MALVEAUX: Do you really believe that the police have some significant leads? They keep talking about it, but have you seen any evidence of that?

DAVIS: I think they may have some things they're not telling us about. But if they had significant leads, I think they'd be coming to the press, where we're the conduit to the public, to get help.

HAYS: Patty, this is one thing I don't understand though. Anybody who reads murder mysteries knows that if the police tell the public everything they know, they're going to be helping the killer not get caught.

I think there's a contradiction here. We all think we want information, but it's not necessarily going to help get the public what they really want, which is to catch the sniper.

DAVIS: Well, that's been a big question all along. You know that Charles Moose, the Montgomery County police chief, ratcheted down those press conferences. I was amazed even at the beginning he was holding a press conference every two hours. I was out there the first or second day. Now it's down to one press conference a day. I think that they are worried that this killer or killers is listening to every word coming out, and they want to be really careful.

KOPPEL: This is such -- I know, Kathleen, you don't live in this city, but for those of us who do, it really is unsettling. Just last night I got off work at about 9 o'clock and I needed gas. I mean, the red light was on on the tank. And I didn't want to go, but I had to. I knew I was coming to work this morning. So I went to one of the gas stations right downtown, thinking that it would be safe. It was out of gas. I couldn't believe it. I'd never heard of something like that.

And then I went -- I mean, I'm just -- I went to another gas station and went purposely, you know, the one by Georgetown, went to the one, the tank that was farthest from the main road, hid behind there, used my credit card. It's really -- I don't know what it's like to cover the story day in and day out, but just to live it here in this city is really...

MALVEAUX: You think that's bad, too, I mean, I actually -- I've resorted to patrolling my own neighborhood now. It's like I will go home, I'm in my car, and I'm literally just driving around the neighborhood looking for white vans or box trucks. And I know my mom would be very upset to hear, you know, very worried about that. But, yes, I mean, people really become activists.

And, you know, I live in the neighborhood where the first five shootings took place, and it has really changed our lives. I mean, I don't go running.

MALVEAUX: And my niece is eight years old. She -- all of her Brownies and her soccer games have been canceled. And, you know, I mean, it really has an impact on the community .

DAVIS: Well, you know, the latest thing from police was the latest lead they're looking at is a shell casing that they found in a -- that a rental car agency, somebody cleaning out the back of a white box truck near Dulles Airport found a shell casing. Investigators looking at that.

Montgomery County police now saying that they may not have results, ballistics tests, to determine whether it was a .223 bullet. You know, that's the high-velocity round that's being used. They may not know if it's even connected until Monday.

But everybody is certainly hopeful that this may be a lead now.

STARR: But whatever happens, if and when hopefully they ever catch this person who's doing this, I think what's really interesting is this is having a long-term economic impact on the nation's capital. Business is down in certain places, gas stations, restaurants, people in outdoor activities, school children. This is, the way I see it, it's every bit as much of an economic impact as 9/11 was.

HAYS: There's all this question about terror. And some of say, "No, no, no, we're convinced it's just some psychopathic killer." Other people say, "No, no, no, it has to be some kind of terror attack." If it did turn out to be that way, that would be one of the reasons why it's so effective, because it does have the effect so easily of shutting so many of us down.

I have to tell you, Andrea, it's interesting, I don't live here. Everybody, when I mentioned, as of say Wednesday or Thursday, "Oh, I'm flying down to Washington Friday night," everyone said, "Well, you be careful," and they said it very seriously.

DAVIS: But I do have to say in the shopping plazas that I've been at, I'm actually seeing more cars now. It's getting back to normal. And I think everybody hears these scare stories about everybody staying home in Washington, D.C. I'm not seeing that necessarily everywhere.

KOPPEL: Do you think it's because there hasn't been an attack for four days?

DAVIS: It could be. Yes, it's been four or five days...

KOPPEL: Five days.

DAVIS: ... since the last attack. That could be. STARR: What happens, Patty, if they don't find the guy? That's the law enforcement nightmare. You know, you see so many cases historically of where snipers just stop and they disappear and no one ever resolves the case. I mean, does law enforcement talk about that now?

DAVIS: Well, that's certainly a frightening prospect, that he takes a big break and then comes back maybe, you know, months or years down the road and tries it again. Hopefully, that's not the case here. Or hopefully, he's in jail, like kind of a Tim McVeigh thing where they stopped him on a traffic violation and got him off the streets and were able to make a connection. You know, hopefully, something like that would happen in this case.

MALVEAUX: I have to tell you guys a story though, really, because I was -- this was last week. I was driving home. It was raining, it was dark. I got a flat tire. I pulled over. I was scared. You know, it's like trying to put the parts together to the jack -- really didn't know what I was doing.

It was the most amazing thing. A man pulled up, and he said, "Do you need some help?" And he started changing my flat tire. This guy is laying on his back on the road. The rain is falling on him. And I just said, you know, "Thank you so much."

And he said the one thing that I didn't want to admit, he said, "You don't need to be out here. You know, this is a time for us all to stick together. You don't need to be out there when you've got this crazy guy on the loose."

And then another car pulls up. It's another gentlemen. He hops out, and he holds his umbrella over the gentleman who's laying on the ground changing my tire. All three of us here are changing the tire together. I mean, it's really like a sign of the times.

HAYS: Could I just say quickly, isn't it interesting we all assume this is a man?

DAVIS: Well, police are saying that is the one thing they do know, it is a man. The one thing that they know.

Plus, they also are thinking from other witnesses that the person is using either the white box truck or a while Econoline van or a Ford Astro. So that's one thing we do know. It doesn't take us very far.

KOPPEL: It's almost that feeling after 9/11.

Well, we will continue to keep watch on the sniper story. And Barbara will talk about how the Pentagon is helping with the search in a moment.

But first, the world seemed to become a more dangerous place this week and not just here at home. We'll talk about North Korea fessing up to a secret nuclear weapons program, when SATURDAY EDITION comes right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

COLIN POWELL, SECRETARY OF STATE: North Korea has some explaining to do to the international community. North Korea has to make a choice as to whether it will move forward and try to provide a better life for its people or waste what limited resources it has developing weapons of mass destruction that will not feed one North Korean child.

(END VIDEO CLIP)

KOPPEL: Secretary of State Colin Powell after North Korea's admission about its secret nuclear weapons program.

Welcome back to CNN's SATURDAY EDITION.

For the administration, a dilemma and a distraction. With so much of the administration's energy directed toward its policy in Iraq, it must also pay attention to this other axis-of-evil menace.

I spoke to one official, who is this very hardened, seasoned, long-term U.S. official, who has been following North Korea for something like four decades. And he said when he read the minutes of the meeting that took place earlier this month in Pyongyang, his jaw dropped. He couldn't believe that the North Koreans, when confronted with this evidence, said, "Yeah, you're right." You know, they were belligerent, they were absolutely making no apologies whatsoever about the fact that they had a secret nuclear weapons program.

STARR: Andrea, could one reason be, because the North Koreans, you know, are pretty sharp, they know in their minds the Bush administration is not going to go to war against them, it's going to go to war against Iraq. So what better time then to publicly admit this?

And I guess the question comes up, why is the State Department taking the diplomatic road? Why are they so diplomatic toward North Korea and so hawkish and war-like toward Iraq on a nuclear program in both countries?

KOPPEL: Well, the first -- they have no idea why the North Koreans have done this now. The North Koreans have never been the easiest country to read. They're known as the hermit kingdom, after all. It could be that, Barbara. It could be the fact that they are trying to use this Iraq as a distraction and that they can just kind of come clean.

It could also be the fact that they, quite frankly, just decided that they wanted to air all their dirty laundry. They're talking with the Japanese, as well, about the fact that they had taken their citizens, basically kidnapped them.

But in terms of what this does with Iraq, oh my God, I mean, this is such -- and you know this, Suzanne, covering the White House -- this is the crisis that the administration does not need right now. MALVEAUX: Absolutely. I mean, this came at the worst possible time, too because it really -- I mean, the credibility of the Bush administration is on the line, when you think about it, because, on the one hand, people are saying, "Well, you're going after Iraq, they're pursuing weapons of mass destruction. North Korea, we know they potentially have weapons of mass destruction. How do you balance the two?"

And this is so political that when the New York Times came out with the article saying that, well, Pakistan might have supplied materials to North Korea in exchange for missiles, I mean, the White House didn't want to touch that one, absolutely. They...

KOPPEL: You're talking about potentially three different problems. You know, you've got North Korea with nukes. You've got Iraq potentially with weapons of mass destruction and the U.S. talking about a possible military attack there.

HAYS: I guess all we need is the third axis of evil to jump in, Iran.

But, you know, you talk about it coming at a bad time for the White House, but you know what? It may come at a good time for the people in the country who do not want to see a war. Let's don't forget, there are people who do not want to see the U.S. attack Iraq. This is not a foregone conclusion, I think, for many people. And I think this will be used by the anti-war forces, however small they may be but may be growing, to say, "Hey, look, how can you justify one and not the other?"

KOPPEL: And you know where they are, Kathleen? On Capitol Hill. The administration is readying itself for some pretty serious maybe post-election action there, calling on the Bush administration to come clean on everything it knows on North Korea and also questioning why didn't this information -- they knew about it for two weeks. They had confronted the North Koreans on October 3rd, 4th and 5th. Why did they wait two weeks to come out? Well, the Iraq resolution on the Hill.

(LAUGHTER)

MALVEAUX: Absolutely. And there are some lawmakers who are really complaining about that -- "We didn't have the full picture before we voted on this resolution on Iraq." But the White House saying, look, they were trying to get their ducks in order, they were trying to prepare.

This was, as you know, I mean, it wasn't necessarily surprising, but it was certainly a bombshell in the sense that they were so brazen about admitting this. They wanted to consult members of Congress. They wanted...

HAYS: But didn't they tell some Republicans first and didn't tell Democrats first? Weren't there some Republicans who were briefed ahead of the Democrats? KOPPEL: There are certainly some who are saying that they were not briefed, and that's true. The administration didn't brief, as they should have, many members of -- certainly the leadership in both houses.

But another bombshell that happened this week. Remember George Tenet on the Hill, remember what he head to say? I think we've got a clip from that.

(BEGIN VIDEO CLIP)

GEORGE TENET, DIRECTOR, CENTRAL INTELLIGENCE AGENCY: We have to get about the business of protecting the country with the private sector, the chiefs of police, the state and locals now. Because the threat environment we find ourselves in today is as bad as it was last summer, the summer before 9/11. It is serious. They have reconstituted. They're coming after us. They want to execute attacks.

(END VIDEO CLIP)

KOPPEL: Not the kind of news you want to be hearing certainly at this time with snipers running around in this city.

DAVIS: That's so frightening. What are they hearing? Why do they say there's a...

KOPPEL: There is a whole lot of noise -- this is what they call it in the intelligence community -- a lot of chatter from various al Qaeda guys out there who are talking about threats against the Americans.

And look, Indonesia, close to 200 people killed there just last weekend. You've got the attack off the coast of Yemen on a French freighter. You've got the attacks in the Philippines this week. Al Qaeda is reconstituting, and it's proving it.

MALVEAUX: But what's interesting too, Andrea, is the fact that you have all of these elements, these things that are happening, and still the terror alert has not gone up. And that is something that administration...

(CROSSTALK)

MALVEAUX: ... officials are saying they don't have credible evidence that an attack is imminent on U.S. soil. And that is really the key. And so we're still at the, you know, the yellow alert, that phase. But clearly, you know, the administration is very concerned about this right now.

STARR: And if all of this wasn't enough to keep the military busy, the responsibilities of the U.S. armed forces do continue to expand, from the DMZ in Korea to the countries surrounding Iraq.

And now to special reconnaissance high above Washington, D.C. We'll talk about that part of the sniper story when CNN's SATURDAY EDITION continues.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

DONALD RUMSFELD, SECRETARY OF DEFENSE: This is far from the first time that the United States military has ever done anything in support of law enforcement or situations in the United States. It is not infrequently done.

(END VIDEO CLIP)

STARR: Defense Secretary Donald Rumsfeld not giving much away about exactly what the U.S. military will do in the search for the sniper.

Welcome back to CNN's SATURDAY EDITION.

U.S. military reconnaissance, when it becomes operational over Washington, D.C. and the surrounding area, could in fact be a very important tool to search for this person if and when they strike again.

The whole idea is that the military can have some eyes in the sky that law enforcement can't. They will be able to react very quickly, narrow down possibly where some activity is taking place, and then guide law enforcement on exactly where to shut the roads down, and try and form an immediate dragnet to catch this guy.

HAYS: It's amazing when you read about these planes and the kinds of things they can pick up. So again, it's not like they're going to be helping to find the sniper before the sniper strikes again. Unfortunately, we have to wait for the sniper to strike, then the planes can zero in on that area and see what they pick up.

STARR: They will do that. The Pentagon is a little wary about offering too many details out in public about exactly how all of this will work. But they do say reconnaissance, and that means they're going to be up there watching, ready to move in.

Very, very importantly though, the military will only collect the information. There will...

DAVIS: How can they possibly get there in time? You already see helicopters. I was at the Monday night scene. There were helicopters immediately over that area. I was there maybe 15 minutes after this woman was murdered at the Home Depot.

How can they possibly get there in time? How can they help?

STARR: Well, the whole idea -- again, not offering too many details to jeopardize an investigation -- is they will be up there around the clock. You know, there's already combat air patrols over Washington, D.C. because of 9/11. This of course is very different, but it's something that the military does. They will be up around the clock, and they will be able to zero in if they seen something that causes them some suspicion that there has been gun activity in an area.

But very importantly, there will be an FBI agent on board every one these military flights, because the military, of course, cannot engage in law enforcement activity. They will only gather the information.

MALVEAUX: That's what I wanted to ask you about, because the ACLU says, you know, they're questioning whether or not this is even legal. I mean, how do they explain the justification for using the military side by side with local law enforcement?

STARR: The Pentagon says the best precedent that they can explain is drug enforcement and drug surveillance. U.S. military aircraft patrol the southern border with Mexico all the time. They gather information, they look for suspicious activity, but they turn that information over to civilian law enforcement to pursue. It has been done in that context, but there has never been a case like this one.

HAYS: I think that distinction is so lost on the American public. I think people probably feel they were maybe not even aware that law existed. And they probably want to see anything that could be done to catch this sniper, not matter who helps. And if the Pentagon has the best equipment to do it, you know, why not use them?

MALVEAUX: You know, there's another law as well, to talk about this fingerprinting, gun fingerprinting. And I just learned about this the last 24 hours. I'm not a gun expert or anything, but it's really fascinating that you can have a shell or a bullet and somehow trace it back to the gun. If you have records, you could trace it back to the gun owner.

It's so political that when the White House, you know, this week when we asked Ari Fleischer about it, you know took the stand same as the NRA, talking about, "Well, you know, we don't know if this is reliable." At the same time, the ATF is promoting this. The next day, the White House says, "Oh, well, you know, we're examining, re- examining, looking at this."

I mean, it's a very political issue as well.

DAVIS: And how it works is they shoot off a gun before it's sold, and the chamber of the gun puts a fingerprint on that bullet as it comes out so that they can catalogue that and then trace it back to the person who was sold the gun. We were really hopeful at the beginning of this sniper investigation, because Maryland has a ballistic fingerprinting law, but it only applies to handguns, doesn't apply to...

KOPPEL: Why isn't there a federal law. This just seems like something that would come in handy to...

HAYS: NRA. Because people feel, if I understand correctly, people who are -- who believe in the right to bear guns and the worry that the federal government will come gather up their guns someday if it turns into a fascist state or something, feel that this could be a way of controlling gun owners and taking away some of their liberty. I think that's the argument that the NRA would make on something like this.

MALVEAUX: And at least the Bush administration is saying, "Well, let's deal with it on a state-by-state basis. We don't have enough evidence that it's reliable technology to nationalize it or to federalize it."

KOPPEL: Barbara, I want to ask you about this story that you broke last night on the fact that U.S. special forces are actually training right now in Jordan for operations in Iraq.

STARR: Really, you know, the Pentagon has had a busy week. While they got involved in the sniper story, they still are very much in the Iraq mode behind the scenes. There are now about 1,500 special forces training in Jordan with other Middle Eastern forces.

The U.S. has made a promise now to Israel, Saudi Arabia and a number of other Persian Gulf nations that they will put special forces into Iraq if a war begins as quickly as possible to try and find and neutralize Saddam Hussein's Scud missiles.

KOPPEL: I think it's fascinating, because Jordan, as you know, before the Gulf War, when then King Hussein was alive, sided with Iraq. And this time, you know, King Abdullah, who is extremely vulnerable with 70 percent of his population being Palestinians, is now allowing American troops to actually train there.

STARR: It is, but it is 12 years later. I think that they realize possibly the U.S., the Bush administration -- this Bush administration does plan to go all the way to Baghdad, that their own forces may have some role to play.

But Israel is really -- and Ariel Sharon's visit in the last several days, I think was a real turning point. They want a commitment from this Bush administration that if Saddam Hussein launches Scuds again at Israel, the U.S. will be there to defend them.

Because the key question that remains unanswered, different this time than the last war, is will Israel just say, "That's it," and enter the war and possibly launch a wider regional war. The U.S. would like Israel to stay out of it. The U.S. wants to say, "Look, we're taking care of those Scuds." But it remains to be seen. Ariel Sharon wants ironclad guarantees from this administration.

HAYS: This is a different Jordan, a different Israel than we faced 12 years ago, but a lot of similarities in the economy. Actually, from national defense to national confusion about the health of the U.S. economy and how to read a widely fluctuating market and other signals. We'll talk about that in a moment.

First, we go to Atlanta for a check on what's making headlines right now.

(INTERRUPTED BY NEWS UPDATE) HAYS: Still ahead on CNN's SATURDAY EDITION, the president takes to the campaign trail, trying to boost Republican chances. Reading the markets, did huge gains this week send a message? And Josie Karp takes us out to the ballpark on this first day of the World Series. Plus, the president's weekly radio address, all coming up on CNN's SATURDAY EDITION.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I'm optimistic about our economy's future, because I know when interest rates are low and inflation is low and the productivity of our great work force is high, we can grow our economy.

(END VIDEO CLIP)

HAYS: President Bush at a political rally this week, doing his part to pump up consumer confidence.

We're back with CNN's SATURDAY EDITION.

The most dramatic display of confidence came on Wall Street this week, with stocks up more than 13 percent over the past six trading days, the best six-day gain since 1982.

A lot of people got their finger's crossed. I think if they're religious, they're saying their prayers and hoping, hoping, hoping that this is the end of the bear market, a transition to a bull market.

However, still no real conviction and in part because we're still getting mixed signals on the economy. And some people think for the bull to really come back, we have to know the economy is on track for some solid growth.

DAVIS: Generally, September-October are not good months for the market.

HAYS: Absolutely. September traditionally has been a very bad month. And what's interesting about October, although there have been big crashes, do you know the crash of 1929 was in October. Today, is the anniversary of the October 19, 1987, stock market crash. October has seen some very nasty things.

What's interesting though about October, they also call it the bear buster, because a lot of bear markets have also ended in October and bull markets have begun. I think -- and who knows if that holds any credence now. Probably another reason, though, why people are kind of hopeful.

KOPPEL: So why is there -- why is it up then 13 percent? That just seems -- especially with Iraq, with North Korea?

HAYS: Isn't that amazing? Isn't that amazing? KOPPEL: Yes.

HAYS: It's like maybe all that worry has been on the front burner for so long, people are maybe a little bit numb and can live with it.

And we had earnings reports. It's a real big deal on Wall Street. You know, once a quarter, companies tell us, did we have profits. You know, there's all of these estimates. And a lot of companies were able to meet, maybe even sometimes beat, the estimates.

Now, the estimates were cut way down, you know, and the bad thing with a lot of these reports is that they did it on cost cutting. They didn't necessarily do it because business was growing a lot. A lot of companies are making money because they're -- what does cutting costs mean? It means laying off workers. In some cases, workers saying, "You know, I'm happy to keep my job. I'll take a 10 percent pay cut."

How long has it been in this country since we heard of anybody being grateful for a pay cut because they didn't lose their job?

DAVIS: The airlines. Recently, we've seen the -- hundreds, probably 100,000 people since September 11 losing their jobs. Now more cuts I understand. And those people are grateful to have jobs at the airlines.

HAYS: Yes. And it's interesting to, UAL, four of the five pilot unions this week apparently late in the week, say it looks like maybe they're reaching an agreement. And they are a real sticking point, because UAL -- they said, "We don't think bankruptcy is inevitable, but it's certainly looming." And the labor concessions are so important.

STARR: Kathleen, what's the latest thinking on how interest rates are affecting all of this? Because while they're good for us as consumers with our home loans, our mortgages and that type of thing, what is this long-term lower interest rate trend meaning for the stock market and for economic growth now?

HAYS: That's such an interesting question, you know, because low interest rates -- even though the economy has been weak, some people say it would be much weaker if we hadn't had the low interest rates. Certainly low interest rates mean no competition for stocks.

The bad thing about low interest rates is they tend to fall when the economy is weak. So that's kind of a warning signal. There's also a debate within the Wall Street economic community and central bankers here and around the world about whether or not they should cut rates more.

A lot of people at the Federal Reserve continue to insist they think the economy is pretty much on track. There's a couple of dissenters there. There's a couple of people saying, look out, because we could go from steady growth to flat growth to something called deflation, where these falling prices that we see spread around -- when prices fall, it's really tough to raise profits. It's a very bad situation.

And globally, you have a big country like China, which is producing so much and has become such a manufacturing powerhouse, they have deflation. They're exporting deflation because they're making all of these goods so cheaply with a cheap labor force.

But what's interesting, I think, is a lot of the policymakers, some people think, are sitting there maybe saying, "We're not going to worry about that now." And so maybe that's a worry on Wall Street.

KOPPEL: So, Kathleen, what does it mean for investors? And I'm one of them. Does that mean that I should buy stocks now while they're so low? What are you hearing?

HAYS: Well, I think what people say is, yes, it's probably a good time to buy companies that are really beaten up, if you feel like that. If you want to start getting in slowly, go ahead. Maybe put 10 percent of your money to work.

I mean, take a company like -- well, I won't mention AOL Time Warner, parent of this network -- well, maybe I will. It's a stock that's very, very beaten up, a company that's had a lot of dark clouds over it, but its stock price is so low, that's a company people say, sooner or later, it's got to start rising again.

General Electric stock price is down. That's a solid, good company that most people don't think is going to go away. Some of the auto comapnies.

But on the other hand, I think people would probably say, Andrea, you can take you time maybe, that the market -- we had this big run- up. There could be some volatility down. So you can really pick your entry points carefully.

But believe me, I'm not giving stock advice...

(LAUGHTER)

HAYS: ... because I've suffered like everybody else, and I would not want to put myself out as example of what to do.

DAVIS: We have a little breaking news now. We've got a man shot in Washington, D.C., at Florida and Q Streets, that's Northwest Washington, D.C. Of course, everybody's thinking sniper. D.C. Police at this point saying they don't believe it's connected. He was shot and killed, but it appears that he was shot with a handgun, not the sniper's M.O. You know, this sniper using either an assault rifle, a hunting rifle.

Obviously everybody's going to be watching this really closely and seeing how this turns out. Ballistics evidence, of course -- at all these shootings, you've got a massive response right away. The ATF, the FBI, they're all hurrying on the scene to lock it down and see what's going on.

MALVEAUX: Well, Patty, from the financial world to the political world, and commander in chief in campaigning this week is President Bush. More coming up as CNN's SATURDAY EDITION continues.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BUSH: That's why I called upon the United Nations and our United States Congress to deal with Iraq before it becomes a -- before we get hurt. Oceans no longer protect us. The threat is real.

(END VIDEO CLIP)

MALVEAUX: President Bush is making his case for his Iraq policy as well as for electing Republicans as he shifts into high-speed campaigning in the final days before the election.

Now, it's absolutely amazing when you think about the schedule. We have a little less than three weeks before the midterm elections. Every day we're on the road. If you can imagine, I mean -- and multiple cities. I mean, you start at 5:30 in the morning and you go all the way until about 10:00 at night covering the president, because they are so worried, they are so concerned. They want the Senate. They think they can get it. They think they can capture that seat. And they want to hold on to the majority in the House.

This is a major priority for this administration. I mean, and we are seeing it. Talk about Iraq, you know, talk about North Korea, but in the next two and a half weeks, the administration is focusing on making sure that they keep the power, that they hold the power, because the president has had such a difficult time getting his legislation through this Congress.

KOPPEL: I've noticed that there are also some people who are saying, "Ahem, how much money are we spending on all of this travel?"

MALVEAUX: Absolutely. Senator Harry Reid, as a matter of fact, asking for the GAO for an accounting, how much are we spending with this. And as you know, the formula typically is, is if you're doing political business and then you're also doing official business, a public policy issue, then it's split between the taxpayers and, say, the GOP or any other private organization.

The administration, at this point, has gotten so much criticism about that, because, yes, typically the president will go ahead, go to an elementary school, talk about education, and then later that evening go to a fund-raiser, raise a million dollars. The administration saying, look, we're just going to go ahead and pay for it, or the GOP will pay for it, fully, because we won't" -- not even the pretense that this is a business trip. This is a political trip.

KOPPEL: But it's also common. I mean, it's not uncommon for presidents to do this in a political season.

MALVEAUX: Absolutely.

STARR: President Clinton was the world's leading expert in his time doing this. In fact, didn't the Bush administration offer a lot of criticism of the Clintons for this very thing?

MALVEAUX: You're right. But what's interesting, too, is that the Democrats now are calling Bush, you know, the fund-raiser in chief now, because Clinton, as you mentioned before, I think, raised some $50 million like before the midterm elections. Well, Bush, this is close, if not more, to $136 million. I mean, that's absolutely amazing. More than 70 trips from the beginning of the year until now. I mean, it's...

DAVIS: Speaking of travel, has he been heading to Florida to help his brother, Governor Jeb Bush there, a Republican, kind of in a very tight race down there?

MALVEAUX: Oh, absolutely. Just this past week he was in Florida helping out Jeb Bush, his brother. And it didn't get a lot of publicity but he's been down there at least seven times. We expect that he might even go one more time before the midterm elections.

And, you know, clearly they're a bit surprised at what's happened. And it would be a terrible disappointment and an embarrassment, really, personally. It's a very personal situation for the administration to make sure that he holds on to his governorship.

HAYS: But what about the issue -- but, you know, it seems to me it's so caught up in the dynamics of whether they're going to keep it. No one seems to have a sense of what issue's going to drive these elections, right? And that's one of the problems they're facing. And to me, it kind of, it makes me -- lays bare that maybe one of the falsehoods of politics that neither side right now even knows what their own issues are that strongly or has conviction to get out there and push them. They're trying to figure out what the public wants to hear still.

MALVEAUX: Well, I think -- I mean, Republicans know, and Democrats will also agree, that Republicans do do better when you talk about war and security issues and Democrats do better when you talk about social issues -- Social Security, education, and things like that.

This administration realizes that people are saying, "Look, you're not talking enough -- you're not addressing the economic needs." And we've seen, you know, Senator Daschle many different times really outright criticizing the president for this very thing.

So we're actually seeing, over the last week or so, some shifts in some of his speeches. He is addressing economic issues. He's talking about the tax cut. I mean, today he's going to unveil a pension reform plan, saying, look, you know, we're going to get tougher with these companies on your 401(k) plans, make sure that you're informed about all of this.

So, I mean, really, it's just, you know, it's a recognition.

MALVEAUX: Exactly, because they don't really know what's going to stick for this election. STARR: And in a few minutes, we're going to get to the really important news of the week. We're going to go to Josie Karp in Anaheim, and we're going to talk about baseball and the World Series, when SATURDAY EDITION continues.

(COMMERCIAL BREAK)

JOSIE KARP, CNN SPORTS CORRESPONDENT: Welcome back to CNN's SATURDAY EDITION.

I'm Josie Karp, and I'm standing outside Edison Field here in Anaheim, California, where tonight, for the very first time in their history, the Anaheim Angels are going to host a World Series games.

There are a number of World Series firsts that we need to talk about regarding this World Series. And the biggest one, the one's that's overshadowing everything, is the first World Series for Barry Bonds of the San Francisco Giants.

And, ladies, it's like nothing anyone who covers baseball has ever really seen, because Barry Bonds has so dominated all of the conversation, all of the thinking on all of the media fronts, by both teams as well, that we've had people actually go back and try to ask questions about, "Was it like this when Babe Ruth was around in 1918, in 1923?" And it's really even the insiders, people who have been around this game for so long say, "There's nothing comparable."

HAYS: Josie?

KARP: And I guess in the political realm, if you want -- yes, go ahead.

HAYS: Yes, I'm curious, I want to stop you on Barry Bonds, because here's a guy who is one of the great hitters in baseball. He's 38 years old, a time when many people would say he's past his prime. He's hitting better than ever.

What about the idea the pitcher is going to have to decide how much to walk Barry Bonds, and stay away from that mighty slugger, how much they're actually going to have to pitch to him?

KARP: That's a huge question, and that's what everyone has been asking of Mike Scioscia, the Angel's manager, "What are you going to do with Barry Bonds?"

There have been situations, you know, he's been walked with the bases loaded. That's scored a run. He's been walked with two outs. He's been walked with no outs. There's no predictable way to say, "Yes, this is what's going to happen when Barry Bonds gets up," but it's certainly the most important question and the one that's generated the most interest in this World Series so far when they haven't even played a game yet. A lot of answers will come tonight when they actually get to play game one.

MALVEAUX: So what is the mood like in Anaheim? I don't know when you arrived there. Are people partying in the streets? KARP: I've been here for a very long time.

MALVEAUX: Are people...

KARP: Well, I wouldn't say that, but it's interesting because they have never hosted a World Series game before. Their team had never actually won a post-season series before. They've generated a lot of enthusiasm.

There are two things that stick out here in Anaheim. One, they hand out these thunder sticks that they clap together that make a lot of noise. There are 45,000 people in here who clap them together. And they have this mascot, this thing they call a rally monkey that shows up when the team is behind, and the crowd just goes crazy. So those are two distinct things.

DAVIS: There's a lawsuit over Barry Bonds 73rd home run. What's that about?

KARP: Well, it's interesting because everything seems to go back to the Giants. They're in the World Series. And then just this week a trial began in San Francisco. Back on October 7, 2001, Barry Bonds hit a 73rd home run. It set a record for a single season. And two men now claim that they deserve the ball. One guy came away from it with the ball. There's another man who said he caught the ball, and he's suing right now. And a trial started during the middle of the week. There's no jury. It's going to be decided by a judge.

But again, there are a couple of interesting things that stick out. One, the actual ball, no one gets to see or touch or play with. That's being held in a safe deposit box about 45 minutes south of San Francisco in a bank in a strip mall. So we don't even see the ball.

The other thing is they're having a slew of expert witnesses. This trial could take three weeks. One expert witness that the defense is going to call is a former Major League umpire who is going to testify as to what is a catch and what is not a catch. And we're not talking about baseball players, ladies. We're talking about fans in the stands. And it's either, you know, something very interesting or a low point.

And all of this...

DAVIS: But, Josie...

KARP: ... of course, is being motivated by money. This ball could be worth a million dollars.

DAVIS: Do you remember though in the days, I covered McGuire and Sosa, that home run slug fest, and it was an era of civility. We had people actually giving the ball back to Marc McGuire. What's happened?

KARP: That era of civility has certainly disappeared in the Bay area when it comes to this. And this week there was another potential lawsuit that was settled over the 600 ball that Barry Bonds hit. So I don't know if it's the Bay area, but when money gets involved -- and again this ball could be worth a million dollars -- I think that's when civility kind of gets thrown out. Although, the may who's suing says he doesn't want to sell the ball, at least not yet.

KOPPEL: Josie, I've got to tell you and you ladies my ball story. When I was a young reporter in Baltimore, I was covering the all-time attendance record at Memorial Stadium being broken. I went there during batting practice. Was out in left field up in the stands, talking to an usher. I turned around and caught a line drive in my face. Josie, you can't see me, but I mean literally right there. And guess who hit it? Cal Ripkin.

I have an autographed baseball from Cal Ripkin -- "Dear Andrea, I hope you're feeling better."

HAYS: Josie, I got the other...

KARP: Did you have a broken nose too?

KOPPEL: I didn't actually. It's solid proof I have a hard head. I just a got a tear in my retina.

UNIDENTIFIED FEMALE: Well, another strong woman to talk about in this, Josie, is the announcer for the Giants. This is an historic thing happening, right?

KARP: Yes, this is really great. I just remember back to my own days growing up when the announcer at the World Series games, your own announcer calls out the starting line-ups and they run out there, you know the World Series has really started for you. For a generation of Giants fans, it's going to be a woman's voice. For the first time, a woman, Renel Brooks, is going to be the PA announcer, and that's when the series moves to PacBell in San Francisco.

MALVEAUX: Thanks to Josie Karp in Anaheim and all of our colleagues, and thank you for watching SATURDAY EDITION.

A news alert is just ahead, but first, the president's weekly radio address.

(INTERRUPED BY LIVE EVENT)

BUSH: Good morning. I want to discuss with you steps we are taking to help strengthen the retirement security of America's workers.

More than 40 million Americans save for retirement through 401(k) accounts, making regular contributions and building economic security over a lifetime. A 401(k) provides a chance to invest in the long- term growth of the American economy and an opportunity to build wealth and independence.

Today's workers own more than $1.5 trillion in assets through their 401(k)s. Younger workers have an average of about $10,000 in their accounts, while workers near retirement hold closer to $100,000 in their 401(k)s. This is real money for real workers, and we must do all we can to help make sure it's there for them when they retire.

Turbulence in the financial markets reminds us that every investment carries some risk. Yet American workers also have rights which must be respected and enforced.

I've made five common-sense proposals to help protect the retirement savings of American workers:

First, every worker should get 30-days advance notice before any blackout period, the time when they cannot sell, buy or borrow from their 401(k)s.

Second, corporate executives should have to follow the same rules that every other employee must follow during blackout periods. If you can't sell on the shop floor, you should not be able to sell on the top floor.

Third, workers should be able to sell their company stock after holding it for three years, so that no one's nest egg is tied up in the stock of a single company.

Fourth, investors should receive better...

(END AUDIOTAPE)

MALVEAUX: And President Bush has just released a statement on Bali.

(INTERRUPED BY LIVE EVENT)

MALVEAUX: That is the president giving a statement about the terrorism attack in Bali, really offering his condolences to the Australians who lost their lives, many of them victims of that latest terrorist attack. As we know, as well a few Americans, but really devastating for that particular country.

STARR: And a really clear signal in the Bush administration's mind that the al Qaeda has regrouped. They do believe this is linked to groups in the region that have ties to the al Qaeda. They're looking very much at the explosives, seeing if it has ties to other al Qaeda attacks. Clear signal that most people believe the al Qaeda is back in business.

UNIDENTIFIED FEMALE: And that maybe Indonesia now will be forced to take steps to deal with the large terrorist network that apparently exists that they just haven't wanted to look at yet.

KOPPEL: Well, in fact they have. The Indonesian president, Megawati Sukarnoputri, just issued for the first time these terrorism decrees that the Bush administration has been pushing for for the last really more than a year ever since 9/11. So, I mean, it was a very important move that they're welcoming.

MALVEAUX: Absolutely.

Thank you very much, everybody. And thank our audience for joining us here on SATURDAY EDITION.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com






Aired October 19, 2002 - 10:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BARBARA STARR, CNN PENTAGON CORRESPONDENT: Welcome to CNN's SATURDAY EDITION, where our journalists share the inside scoop on the stories they covered this week. I'm Barbara Starr.
The Pentagon lends high-tech reconnaissance help for the search for the sniper.

PATTY DAVIS, CNN CORRESPONDENT: I'm Patty Davis.

The latest on the sniper hunt -- after two and a half weeks, nine deaths, cops are pleading for leads.

ANDREA KOPPEL, CNN STATE DEPARTMENT CORRESPONDENT: I'm Andrea Koppel.

A radioactive reminder this week from North Korea that the world is a dangerous place.

KATHLEEN HAYS, CNN FINANCIAL NEWS CORRESPONDENT: I'm Kathleen Hays.

The stock market rockets back in a way not seen since the '30s, while other economic news sends a mixed message.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: I'm Suzanne Malveaux.

The president pushes his Iraq message as he shifts into high political gear in the final weeks before the election.

We'll be talking about all these stories. CNN Sports correspondent Josie Karp will be joining us later from where game one of the World Series will be played this evening. We'll have the president's radio address at the end of the hour, but first, a check of what's making headlines right now, in Atlanta.

(NEWSBREAK)

DAVIS: The capital-area sniper has killed nine people. A law enforcement army is after the shooter or shooters, but so far, none of the leads have paid off.

And what seems to have been false information rocked investigators midweek. In fact, the man who gave that false information, Matthew Dowdy, now under arrest.

MALVEAUX: You know, what kind of person really would do something like that, though? I don't understand. What was motivation? Do they tell you -- did the police say why it was he made up the story in the first place?

DAVIS: Well, some surmise that perhaps he was looking for his 15 minutes of glory. He's an ex-con. But the information particularly damaging that he gave police. One, he actually described an olive- skinned suspect. He described a cream-colored car with a left taillight out -- very specific information. And he said this man was shouldering an AK-74. Threw police off, wasted valuable times.

MALVEAUX: Do you really believe that the police have some significant leads? They keep talking about it, but have you seen any evidence of that?

DAVIS: I think they may have some things they're not telling us about. But if they had significant leads, I think they'd be coming to the press, where we're the conduit to the public, to get help.

HAYS: Patty, this is one thing I don't understand though. Anybody who reads murder mysteries knows that if the police tell the public everything they know, they're going to be helping the killer not get caught.

I think there's a contradiction here. We all think we want information, but it's not necessarily going to help get the public what they really want, which is to catch the sniper.

DAVIS: Well, that's been a big question all along. You know that Charles Moose, the Montgomery County police chief, ratcheted down those press conferences. I was amazed even at the beginning he was holding a press conference every two hours. I was out there the first or second day. Now it's down to one press conference a day. I think that they are worried that this killer or killers is listening to every word coming out, and they want to be really careful.

KOPPEL: This is such -- I know, Kathleen, you don't live in this city, but for those of us who do, it really is unsettling. Just last night I got off work at about 9 o'clock and I needed gas. I mean, the red light was on on the tank. And I didn't want to go, but I had to. I knew I was coming to work this morning. So I went to one of the gas stations right downtown, thinking that it would be safe. It was out of gas. I couldn't believe it. I'd never heard of something like that.

And then I went -- I mean, I'm just -- I went to another gas station and went purposely, you know, the one by Georgetown, went to the one, the tank that was farthest from the main road, hid behind there, used my credit card. It's really -- I don't know what it's like to cover the story day in and day out, but just to live it here in this city is really...

MALVEAUX: You think that's bad, too, I mean, I actually -- I've resorted to patrolling my own neighborhood now. It's like I will go home, I'm in my car, and I'm literally just driving around the neighborhood looking for white vans or box trucks. And I know my mom would be very upset to hear, you know, very worried about that. But, yes, I mean, people really become activists.

And, you know, I live in the neighborhood where the first five shootings took place, and it has really changed our lives. I mean, I don't go running.

MALVEAUX: And my niece is eight years old. She -- all of her Brownies and her soccer games have been canceled. And, you know, I mean, it really has an impact on the community .

DAVIS: Well, you know, the latest thing from police was the latest lead they're looking at is a shell casing that they found in a -- that a rental car agency, somebody cleaning out the back of a white box truck near Dulles Airport found a shell casing. Investigators looking at that.

Montgomery County police now saying that they may not have results, ballistics tests, to determine whether it was a .223 bullet. You know, that's the high-velocity round that's being used. They may not know if it's even connected until Monday.

But everybody is certainly hopeful that this may be a lead now.

STARR: But whatever happens, if and when hopefully they ever catch this person who's doing this, I think what's really interesting is this is having a long-term economic impact on the nation's capital. Business is down in certain places, gas stations, restaurants, people in outdoor activities, school children. This is, the way I see it, it's every bit as much of an economic impact as 9/11 was.

HAYS: There's all this question about terror. And some of say, "No, no, no, we're convinced it's just some psychopathic killer." Other people say, "No, no, no, it has to be some kind of terror attack." If it did turn out to be that way, that would be one of the reasons why it's so effective, because it does have the effect so easily of shutting so many of us down.

I have to tell you, Andrea, it's interesting, I don't live here. Everybody, when I mentioned, as of say Wednesday or Thursday, "Oh, I'm flying down to Washington Friday night," everyone said, "Well, you be careful," and they said it very seriously.

DAVIS: But I do have to say in the shopping plazas that I've been at, I'm actually seeing more cars now. It's getting back to normal. And I think everybody hears these scare stories about everybody staying home in Washington, D.C. I'm not seeing that necessarily everywhere.

KOPPEL: Do you think it's because there hasn't been an attack for four days?

DAVIS: It could be. Yes, it's been four or five days...

KOPPEL: Five days.

DAVIS: ... since the last attack. That could be. STARR: What happens, Patty, if they don't find the guy? That's the law enforcement nightmare. You know, you see so many cases historically of where snipers just stop and they disappear and no one ever resolves the case. I mean, does law enforcement talk about that now?

DAVIS: Well, that's certainly a frightening prospect, that he takes a big break and then comes back maybe, you know, months or years down the road and tries it again. Hopefully, that's not the case here. Or hopefully, he's in jail, like kind of a Tim McVeigh thing where they stopped him on a traffic violation and got him off the streets and were able to make a connection. You know, hopefully, something like that would happen in this case.

MALVEAUX: I have to tell you guys a story though, really, because I was -- this was last week. I was driving home. It was raining, it was dark. I got a flat tire. I pulled over. I was scared. You know, it's like trying to put the parts together to the jack -- really didn't know what I was doing.

It was the most amazing thing. A man pulled up, and he said, "Do you need some help?" And he started changing my flat tire. This guy is laying on his back on the road. The rain is falling on him. And I just said, you know, "Thank you so much."

And he said the one thing that I didn't want to admit, he said, "You don't need to be out here. You know, this is a time for us all to stick together. You don't need to be out there when you've got this crazy guy on the loose."

And then another car pulls up. It's another gentlemen. He hops out, and he holds his umbrella over the gentleman who's laying on the ground changing my tire. All three of us here are changing the tire together. I mean, it's really like a sign of the times.

HAYS: Could I just say quickly, isn't it interesting we all assume this is a man?

DAVIS: Well, police are saying that is the one thing they do know, it is a man. The one thing that they know.

Plus, they also are thinking from other witnesses that the person is using either the white box truck or a while Econoline van or a Ford Astro. So that's one thing we do know. It doesn't take us very far.

KOPPEL: It's almost that feeling after 9/11.

Well, we will continue to keep watch on the sniper story. And Barbara will talk about how the Pentagon is helping with the search in a moment.

But first, the world seemed to become a more dangerous place this week and not just here at home. We'll talk about North Korea fessing up to a secret nuclear weapons program, when SATURDAY EDITION comes right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

COLIN POWELL, SECRETARY OF STATE: North Korea has some explaining to do to the international community. North Korea has to make a choice as to whether it will move forward and try to provide a better life for its people or waste what limited resources it has developing weapons of mass destruction that will not feed one North Korean child.

(END VIDEO CLIP)

KOPPEL: Secretary of State Colin Powell after North Korea's admission about its secret nuclear weapons program.

Welcome back to CNN's SATURDAY EDITION.

For the administration, a dilemma and a distraction. With so much of the administration's energy directed toward its policy in Iraq, it must also pay attention to this other axis-of-evil menace.

I spoke to one official, who is this very hardened, seasoned, long-term U.S. official, who has been following North Korea for something like four decades. And he said when he read the minutes of the meeting that took place earlier this month in Pyongyang, his jaw dropped. He couldn't believe that the North Koreans, when confronted with this evidence, said, "Yeah, you're right." You know, they were belligerent, they were absolutely making no apologies whatsoever about the fact that they had a secret nuclear weapons program.

STARR: Andrea, could one reason be, because the North Koreans, you know, are pretty sharp, they know in their minds the Bush administration is not going to go to war against them, it's going to go to war against Iraq. So what better time then to publicly admit this?

And I guess the question comes up, why is the State Department taking the diplomatic road? Why are they so diplomatic toward North Korea and so hawkish and war-like toward Iraq on a nuclear program in both countries?

KOPPEL: Well, the first -- they have no idea why the North Koreans have done this now. The North Koreans have never been the easiest country to read. They're known as the hermit kingdom, after all. It could be that, Barbara. It could be the fact that they are trying to use this Iraq as a distraction and that they can just kind of come clean.

It could also be the fact that they, quite frankly, just decided that they wanted to air all their dirty laundry. They're talking with the Japanese, as well, about the fact that they had taken their citizens, basically kidnapped them.

But in terms of what this does with Iraq, oh my God, I mean, this is such -- and you know this, Suzanne, covering the White House -- this is the crisis that the administration does not need right now. MALVEAUX: Absolutely. I mean, this came at the worst possible time, too because it really -- I mean, the credibility of the Bush administration is on the line, when you think about it, because, on the one hand, people are saying, "Well, you're going after Iraq, they're pursuing weapons of mass destruction. North Korea, we know they potentially have weapons of mass destruction. How do you balance the two?"

And this is so political that when the New York Times came out with the article saying that, well, Pakistan might have supplied materials to North Korea in exchange for missiles, I mean, the White House didn't want to touch that one, absolutely. They...

KOPPEL: You're talking about potentially three different problems. You know, you've got North Korea with nukes. You've got Iraq potentially with weapons of mass destruction and the U.S. talking about a possible military attack there.

HAYS: I guess all we need is the third axis of evil to jump in, Iran.

But, you know, you talk about it coming at a bad time for the White House, but you know what? It may come at a good time for the people in the country who do not want to see a war. Let's don't forget, there are people who do not want to see the U.S. attack Iraq. This is not a foregone conclusion, I think, for many people. And I think this will be used by the anti-war forces, however small they may be but may be growing, to say, "Hey, look, how can you justify one and not the other?"

KOPPEL: And you know where they are, Kathleen? On Capitol Hill. The administration is readying itself for some pretty serious maybe post-election action there, calling on the Bush administration to come clean on everything it knows on North Korea and also questioning why didn't this information -- they knew about it for two weeks. They had confronted the North Koreans on October 3rd, 4th and 5th. Why did they wait two weeks to come out? Well, the Iraq resolution on the Hill.

(LAUGHTER)

MALVEAUX: Absolutely. And there are some lawmakers who are really complaining about that -- "We didn't have the full picture before we voted on this resolution on Iraq." But the White House saying, look, they were trying to get their ducks in order, they were trying to prepare.

This was, as you know, I mean, it wasn't necessarily surprising, but it was certainly a bombshell in the sense that they were so brazen about admitting this. They wanted to consult members of Congress. They wanted...

HAYS: But didn't they tell some Republicans first and didn't tell Democrats first? Weren't there some Republicans who were briefed ahead of the Democrats? KOPPEL: There are certainly some who are saying that they were not briefed, and that's true. The administration didn't brief, as they should have, many members of -- certainly the leadership in both houses.

But another bombshell that happened this week. Remember George Tenet on the Hill, remember what he head to say? I think we've got a clip from that.

(BEGIN VIDEO CLIP)

GEORGE TENET, DIRECTOR, CENTRAL INTELLIGENCE AGENCY: We have to get about the business of protecting the country with the private sector, the chiefs of police, the state and locals now. Because the threat environment we find ourselves in today is as bad as it was last summer, the summer before 9/11. It is serious. They have reconstituted. They're coming after us. They want to execute attacks.

(END VIDEO CLIP)

KOPPEL: Not the kind of news you want to be hearing certainly at this time with snipers running around in this city.

DAVIS: That's so frightening. What are they hearing? Why do they say there's a...

KOPPEL: There is a whole lot of noise -- this is what they call it in the intelligence community -- a lot of chatter from various al Qaeda guys out there who are talking about threats against the Americans.

And look, Indonesia, close to 200 people killed there just last weekend. You've got the attack off the coast of Yemen on a French freighter. You've got the attacks in the Philippines this week. Al Qaeda is reconstituting, and it's proving it.

MALVEAUX: But what's interesting too, Andrea, is the fact that you have all of these elements, these things that are happening, and still the terror alert has not gone up. And that is something that administration...

(CROSSTALK)

MALVEAUX: ... officials are saying they don't have credible evidence that an attack is imminent on U.S. soil. And that is really the key. And so we're still at the, you know, the yellow alert, that phase. But clearly, you know, the administration is very concerned about this right now.

STARR: And if all of this wasn't enough to keep the military busy, the responsibilities of the U.S. armed forces do continue to expand, from the DMZ in Korea to the countries surrounding Iraq.

And now to special reconnaissance high above Washington, D.C. We'll talk about that part of the sniper story when CNN's SATURDAY EDITION continues.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

DONALD RUMSFELD, SECRETARY OF DEFENSE: This is far from the first time that the United States military has ever done anything in support of law enforcement or situations in the United States. It is not infrequently done.

(END VIDEO CLIP)

STARR: Defense Secretary Donald Rumsfeld not giving much away about exactly what the U.S. military will do in the search for the sniper.

Welcome back to CNN's SATURDAY EDITION.

U.S. military reconnaissance, when it becomes operational over Washington, D.C. and the surrounding area, could in fact be a very important tool to search for this person if and when they strike again.

The whole idea is that the military can have some eyes in the sky that law enforcement can't. They will be able to react very quickly, narrow down possibly where some activity is taking place, and then guide law enforcement on exactly where to shut the roads down, and try and form an immediate dragnet to catch this guy.

HAYS: It's amazing when you read about these planes and the kinds of things they can pick up. So again, it's not like they're going to be helping to find the sniper before the sniper strikes again. Unfortunately, we have to wait for the sniper to strike, then the planes can zero in on that area and see what they pick up.

STARR: They will do that. The Pentagon is a little wary about offering too many details out in public about exactly how all of this will work. But they do say reconnaissance, and that means they're going to be up there watching, ready to move in.

Very, very importantly though, the military will only collect the information. There will...

DAVIS: How can they possibly get there in time? You already see helicopters. I was at the Monday night scene. There were helicopters immediately over that area. I was there maybe 15 minutes after this woman was murdered at the Home Depot.

How can they possibly get there in time? How can they help?

STARR: Well, the whole idea -- again, not offering too many details to jeopardize an investigation -- is they will be up there around the clock. You know, there's already combat air patrols over Washington, D.C. because of 9/11. This of course is very different, but it's something that the military does. They will be up around the clock, and they will be able to zero in if they seen something that causes them some suspicion that there has been gun activity in an area.

But very importantly, there will be an FBI agent on board every one these military flights, because the military, of course, cannot engage in law enforcement activity. They will only gather the information.

MALVEAUX: That's what I wanted to ask you about, because the ACLU says, you know, they're questioning whether or not this is even legal. I mean, how do they explain the justification for using the military side by side with local law enforcement?

STARR: The Pentagon says the best precedent that they can explain is drug enforcement and drug surveillance. U.S. military aircraft patrol the southern border with Mexico all the time. They gather information, they look for suspicious activity, but they turn that information over to civilian law enforcement to pursue. It has been done in that context, but there has never been a case like this one.

HAYS: I think that distinction is so lost on the American public. I think people probably feel they were maybe not even aware that law existed. And they probably want to see anything that could be done to catch this sniper, not matter who helps. And if the Pentagon has the best equipment to do it, you know, why not use them?

MALVEAUX: You know, there's another law as well, to talk about this fingerprinting, gun fingerprinting. And I just learned about this the last 24 hours. I'm not a gun expert or anything, but it's really fascinating that you can have a shell or a bullet and somehow trace it back to the gun. If you have records, you could trace it back to the gun owner.

It's so political that when the White House, you know, this week when we asked Ari Fleischer about it, you know took the stand same as the NRA, talking about, "Well, you know, we don't know if this is reliable." At the same time, the ATF is promoting this. The next day, the White House says, "Oh, well, you know, we're examining, re- examining, looking at this."

I mean, it's a very political issue as well.

DAVIS: And how it works is they shoot off a gun before it's sold, and the chamber of the gun puts a fingerprint on that bullet as it comes out so that they can catalogue that and then trace it back to the person who was sold the gun. We were really hopeful at the beginning of this sniper investigation, because Maryland has a ballistic fingerprinting law, but it only applies to handguns, doesn't apply to...

KOPPEL: Why isn't there a federal law. This just seems like something that would come in handy to...

HAYS: NRA. Because people feel, if I understand correctly, people who are -- who believe in the right to bear guns and the worry that the federal government will come gather up their guns someday if it turns into a fascist state or something, feel that this could be a way of controlling gun owners and taking away some of their liberty. I think that's the argument that the NRA would make on something like this.

MALVEAUX: And at least the Bush administration is saying, "Well, let's deal with it on a state-by-state basis. We don't have enough evidence that it's reliable technology to nationalize it or to federalize it."

KOPPEL: Barbara, I want to ask you about this story that you broke last night on the fact that U.S. special forces are actually training right now in Jordan for operations in Iraq.

STARR: Really, you know, the Pentagon has had a busy week. While they got involved in the sniper story, they still are very much in the Iraq mode behind the scenes. There are now about 1,500 special forces training in Jordan with other Middle Eastern forces.

The U.S. has made a promise now to Israel, Saudi Arabia and a number of other Persian Gulf nations that they will put special forces into Iraq if a war begins as quickly as possible to try and find and neutralize Saddam Hussein's Scud missiles.

KOPPEL: I think it's fascinating, because Jordan, as you know, before the Gulf War, when then King Hussein was alive, sided with Iraq. And this time, you know, King Abdullah, who is extremely vulnerable with 70 percent of his population being Palestinians, is now allowing American troops to actually train there.

STARR: It is, but it is 12 years later. I think that they realize possibly the U.S., the Bush administration -- this Bush administration does plan to go all the way to Baghdad, that their own forces may have some role to play.

But Israel is really -- and Ariel Sharon's visit in the last several days, I think was a real turning point. They want a commitment from this Bush administration that if Saddam Hussein launches Scuds again at Israel, the U.S. will be there to defend them.

Because the key question that remains unanswered, different this time than the last war, is will Israel just say, "That's it," and enter the war and possibly launch a wider regional war. The U.S. would like Israel to stay out of it. The U.S. wants to say, "Look, we're taking care of those Scuds." But it remains to be seen. Ariel Sharon wants ironclad guarantees from this administration.

HAYS: This is a different Jordan, a different Israel than we faced 12 years ago, but a lot of similarities in the economy. Actually, from national defense to national confusion about the health of the U.S. economy and how to read a widely fluctuating market and other signals. We'll talk about that in a moment.

First, we go to Atlanta for a check on what's making headlines right now.

(INTERRUPTED BY NEWS UPDATE) HAYS: Still ahead on CNN's SATURDAY EDITION, the president takes to the campaign trail, trying to boost Republican chances. Reading the markets, did huge gains this week send a message? And Josie Karp takes us out to the ballpark on this first day of the World Series. Plus, the president's weekly radio address, all coming up on CNN's SATURDAY EDITION.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I'm optimistic about our economy's future, because I know when interest rates are low and inflation is low and the productivity of our great work force is high, we can grow our economy.

(END VIDEO CLIP)

HAYS: President Bush at a political rally this week, doing his part to pump up consumer confidence.

We're back with CNN's SATURDAY EDITION.

The most dramatic display of confidence came on Wall Street this week, with stocks up more than 13 percent over the past six trading days, the best six-day gain since 1982.

A lot of people got their finger's crossed. I think if they're religious, they're saying their prayers and hoping, hoping, hoping that this is the end of the bear market, a transition to a bull market.

However, still no real conviction and in part because we're still getting mixed signals on the economy. And some people think for the bull to really come back, we have to know the economy is on track for some solid growth.

DAVIS: Generally, September-October are not good months for the market.

HAYS: Absolutely. September traditionally has been a very bad month. And what's interesting about October, although there have been big crashes, do you know the crash of 1929 was in October. Today, is the anniversary of the October 19, 1987, stock market crash. October has seen some very nasty things.

What's interesting though about October, they also call it the bear buster, because a lot of bear markets have also ended in October and bull markets have begun. I think -- and who knows if that holds any credence now. Probably another reason, though, why people are kind of hopeful.

KOPPEL: So why is there -- why is it up then 13 percent? That just seems -- especially with Iraq, with North Korea?

HAYS: Isn't that amazing? Isn't that amazing? KOPPEL: Yes.

HAYS: It's like maybe all that worry has been on the front burner for so long, people are maybe a little bit numb and can live with it.

And we had earnings reports. It's a real big deal on Wall Street. You know, once a quarter, companies tell us, did we have profits. You know, there's all of these estimates. And a lot of companies were able to meet, maybe even sometimes beat, the estimates.

Now, the estimates were cut way down, you know, and the bad thing with a lot of these reports is that they did it on cost cutting. They didn't necessarily do it because business was growing a lot. A lot of companies are making money because they're -- what does cutting costs mean? It means laying off workers. In some cases, workers saying, "You know, I'm happy to keep my job. I'll take a 10 percent pay cut."

How long has it been in this country since we heard of anybody being grateful for a pay cut because they didn't lose their job?

DAVIS: The airlines. Recently, we've seen the -- hundreds, probably 100,000 people since September 11 losing their jobs. Now more cuts I understand. And those people are grateful to have jobs at the airlines.

HAYS: Yes. And it's interesting to, UAL, four of the five pilot unions this week apparently late in the week, say it looks like maybe they're reaching an agreement. And they are a real sticking point, because UAL -- they said, "We don't think bankruptcy is inevitable, but it's certainly looming." And the labor concessions are so important.

STARR: Kathleen, what's the latest thinking on how interest rates are affecting all of this? Because while they're good for us as consumers with our home loans, our mortgages and that type of thing, what is this long-term lower interest rate trend meaning for the stock market and for economic growth now?

HAYS: That's such an interesting question, you know, because low interest rates -- even though the economy has been weak, some people say it would be much weaker if we hadn't had the low interest rates. Certainly low interest rates mean no competition for stocks.

The bad thing about low interest rates is they tend to fall when the economy is weak. So that's kind of a warning signal. There's also a debate within the Wall Street economic community and central bankers here and around the world about whether or not they should cut rates more.

A lot of people at the Federal Reserve continue to insist they think the economy is pretty much on track. There's a couple of dissenters there. There's a couple of people saying, look out, because we could go from steady growth to flat growth to something called deflation, where these falling prices that we see spread around -- when prices fall, it's really tough to raise profits. It's a very bad situation.

And globally, you have a big country like China, which is producing so much and has become such a manufacturing powerhouse, they have deflation. They're exporting deflation because they're making all of these goods so cheaply with a cheap labor force.

But what's interesting, I think, is a lot of the policymakers, some people think, are sitting there maybe saying, "We're not going to worry about that now." And so maybe that's a worry on Wall Street.

KOPPEL: So, Kathleen, what does it mean for investors? And I'm one of them. Does that mean that I should buy stocks now while they're so low? What are you hearing?

HAYS: Well, I think what people say is, yes, it's probably a good time to buy companies that are really beaten up, if you feel like that. If you want to start getting in slowly, go ahead. Maybe put 10 percent of your money to work.

I mean, take a company like -- well, I won't mention AOL Time Warner, parent of this network -- well, maybe I will. It's a stock that's very, very beaten up, a company that's had a lot of dark clouds over it, but its stock price is so low, that's a company people say, sooner or later, it's got to start rising again.

General Electric stock price is down. That's a solid, good company that most people don't think is going to go away. Some of the auto comapnies.

But on the other hand, I think people would probably say, Andrea, you can take you time maybe, that the market -- we had this big run- up. There could be some volatility down. So you can really pick your entry points carefully.

But believe me, I'm not giving stock advice...

(LAUGHTER)

HAYS: ... because I've suffered like everybody else, and I would not want to put myself out as example of what to do.

DAVIS: We have a little breaking news now. We've got a man shot in Washington, D.C., at Florida and Q Streets, that's Northwest Washington, D.C. Of course, everybody's thinking sniper. D.C. Police at this point saying they don't believe it's connected. He was shot and killed, but it appears that he was shot with a handgun, not the sniper's M.O. You know, this sniper using either an assault rifle, a hunting rifle.

Obviously everybody's going to be watching this really closely and seeing how this turns out. Ballistics evidence, of course -- at all these shootings, you've got a massive response right away. The ATF, the FBI, they're all hurrying on the scene to lock it down and see what's going on.

MALVEAUX: Well, Patty, from the financial world to the political world, and commander in chief in campaigning this week is President Bush. More coming up as CNN's SATURDAY EDITION continues.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BUSH: That's why I called upon the United Nations and our United States Congress to deal with Iraq before it becomes a -- before we get hurt. Oceans no longer protect us. The threat is real.

(END VIDEO CLIP)

MALVEAUX: President Bush is making his case for his Iraq policy as well as for electing Republicans as he shifts into high-speed campaigning in the final days before the election.

Now, it's absolutely amazing when you think about the schedule. We have a little less than three weeks before the midterm elections. Every day we're on the road. If you can imagine, I mean -- and multiple cities. I mean, you start at 5:30 in the morning and you go all the way until about 10:00 at night covering the president, because they are so worried, they are so concerned. They want the Senate. They think they can get it. They think they can capture that seat. And they want to hold on to the majority in the House.

This is a major priority for this administration. I mean, and we are seeing it. Talk about Iraq, you know, talk about North Korea, but in the next two and a half weeks, the administration is focusing on making sure that they keep the power, that they hold the power, because the president has had such a difficult time getting his legislation through this Congress.

KOPPEL: I've noticed that there are also some people who are saying, "Ahem, how much money are we spending on all of this travel?"

MALVEAUX: Absolutely. Senator Harry Reid, as a matter of fact, asking for the GAO for an accounting, how much are we spending with this. And as you know, the formula typically is, is if you're doing political business and then you're also doing official business, a public policy issue, then it's split between the taxpayers and, say, the GOP or any other private organization.

The administration, at this point, has gotten so much criticism about that, because, yes, typically the president will go ahead, go to an elementary school, talk about education, and then later that evening go to a fund-raiser, raise a million dollars. The administration saying, look, we're just going to go ahead and pay for it, or the GOP will pay for it, fully, because we won't" -- not even the pretense that this is a business trip. This is a political trip.

KOPPEL: But it's also common. I mean, it's not uncommon for presidents to do this in a political season.

MALVEAUX: Absolutely.

STARR: President Clinton was the world's leading expert in his time doing this. In fact, didn't the Bush administration offer a lot of criticism of the Clintons for this very thing?

MALVEAUX: You're right. But what's interesting, too, is that the Democrats now are calling Bush, you know, the fund-raiser in chief now, because Clinton, as you mentioned before, I think, raised some $50 million like before the midterm elections. Well, Bush, this is close, if not more, to $136 million. I mean, that's absolutely amazing. More than 70 trips from the beginning of the year until now. I mean, it's...

DAVIS: Speaking of travel, has he been heading to Florida to help his brother, Governor Jeb Bush there, a Republican, kind of in a very tight race down there?

MALVEAUX: Oh, absolutely. Just this past week he was in Florida helping out Jeb Bush, his brother. And it didn't get a lot of publicity but he's been down there at least seven times. We expect that he might even go one more time before the midterm elections.

And, you know, clearly they're a bit surprised at what's happened. And it would be a terrible disappointment and an embarrassment, really, personally. It's a very personal situation for the administration to make sure that he holds on to his governorship.

HAYS: But what about the issue -- but, you know, it seems to me it's so caught up in the dynamics of whether they're going to keep it. No one seems to have a sense of what issue's going to drive these elections, right? And that's one of the problems they're facing. And to me, it kind of, it makes me -- lays bare that maybe one of the falsehoods of politics that neither side right now even knows what their own issues are that strongly or has conviction to get out there and push them. They're trying to figure out what the public wants to hear still.

MALVEAUX: Well, I think -- I mean, Republicans know, and Democrats will also agree, that Republicans do do better when you talk about war and security issues and Democrats do better when you talk about social issues -- Social Security, education, and things like that.

This administration realizes that people are saying, "Look, you're not talking enough -- you're not addressing the economic needs." And we've seen, you know, Senator Daschle many different times really outright criticizing the president for this very thing.

So we're actually seeing, over the last week or so, some shifts in some of his speeches. He is addressing economic issues. He's talking about the tax cut. I mean, today he's going to unveil a pension reform plan, saying, look, you know, we're going to get tougher with these companies on your 401(k) plans, make sure that you're informed about all of this.

So, I mean, really, it's just, you know, it's a recognition.

MALVEAUX: Exactly, because they don't really know what's going to stick for this election. STARR: And in a few minutes, we're going to get to the really important news of the week. We're going to go to Josie Karp in Anaheim, and we're going to talk about baseball and the World Series, when SATURDAY EDITION continues.

(COMMERCIAL BREAK)

JOSIE KARP, CNN SPORTS CORRESPONDENT: Welcome back to CNN's SATURDAY EDITION.

I'm Josie Karp, and I'm standing outside Edison Field here in Anaheim, California, where tonight, for the very first time in their history, the Anaheim Angels are going to host a World Series games.

There are a number of World Series firsts that we need to talk about regarding this World Series. And the biggest one, the one's that's overshadowing everything, is the first World Series for Barry Bonds of the San Francisco Giants.

And, ladies, it's like nothing anyone who covers baseball has ever really seen, because Barry Bonds has so dominated all of the conversation, all of the thinking on all of the media fronts, by both teams as well, that we've had people actually go back and try to ask questions about, "Was it like this when Babe Ruth was around in 1918, in 1923?" And it's really even the insiders, people who have been around this game for so long say, "There's nothing comparable."

HAYS: Josie?

KARP: And I guess in the political realm, if you want -- yes, go ahead.

HAYS: Yes, I'm curious, I want to stop you on Barry Bonds, because here's a guy who is one of the great hitters in baseball. He's 38 years old, a time when many people would say he's past his prime. He's hitting better than ever.

What about the idea the pitcher is going to have to decide how much to walk Barry Bonds, and stay away from that mighty slugger, how much they're actually going to have to pitch to him?

KARP: That's a huge question, and that's what everyone has been asking of Mike Scioscia, the Angel's manager, "What are you going to do with Barry Bonds?"

There have been situations, you know, he's been walked with the bases loaded. That's scored a run. He's been walked with two outs. He's been walked with no outs. There's no predictable way to say, "Yes, this is what's going to happen when Barry Bonds gets up," but it's certainly the most important question and the one that's generated the most interest in this World Series so far when they haven't even played a game yet. A lot of answers will come tonight when they actually get to play game one.

MALVEAUX: So what is the mood like in Anaheim? I don't know when you arrived there. Are people partying in the streets? KARP: I've been here for a very long time.

MALVEAUX: Are people...

KARP: Well, I wouldn't say that, but it's interesting because they have never hosted a World Series game before. Their team had never actually won a post-season series before. They've generated a lot of enthusiasm.

There are two things that stick out here in Anaheim. One, they hand out these thunder sticks that they clap together that make a lot of noise. There are 45,000 people in here who clap them together. And they have this mascot, this thing they call a rally monkey that shows up when the team is behind, and the crowd just goes crazy. So those are two distinct things.

DAVIS: There's a lawsuit over Barry Bonds 73rd home run. What's that about?

KARP: Well, it's interesting because everything seems to go back to the Giants. They're in the World Series. And then just this week a trial began in San Francisco. Back on October 7, 2001, Barry Bonds hit a 73rd home run. It set a record for a single season. And two men now claim that they deserve the ball. One guy came away from it with the ball. There's another man who said he caught the ball, and he's suing right now. And a trial started during the middle of the week. There's no jury. It's going to be decided by a judge.

But again, there are a couple of interesting things that stick out. One, the actual ball, no one gets to see or touch or play with. That's being held in a safe deposit box about 45 minutes south of San Francisco in a bank in a strip mall. So we don't even see the ball.

The other thing is they're having a slew of expert witnesses. This trial could take three weeks. One expert witness that the defense is going to call is a former Major League umpire who is going to testify as to what is a catch and what is not a catch. And we're not talking about baseball players, ladies. We're talking about fans in the stands. And it's either, you know, something very interesting or a low point.

And all of this...

DAVIS: But, Josie...

KARP: ... of course, is being motivated by money. This ball could be worth a million dollars.

DAVIS: Do you remember though in the days, I covered McGuire and Sosa, that home run slug fest, and it was an era of civility. We had people actually giving the ball back to Marc McGuire. What's happened?

KARP: That era of civility has certainly disappeared in the Bay area when it comes to this. And this week there was another potential lawsuit that was settled over the 600 ball that Barry Bonds hit. So I don't know if it's the Bay area, but when money gets involved -- and again this ball could be worth a million dollars -- I think that's when civility kind of gets thrown out. Although, the may who's suing says he doesn't want to sell the ball, at least not yet.

KOPPEL: Josie, I've got to tell you and you ladies my ball story. When I was a young reporter in Baltimore, I was covering the all-time attendance record at Memorial Stadium being broken. I went there during batting practice. Was out in left field up in the stands, talking to an usher. I turned around and caught a line drive in my face. Josie, you can't see me, but I mean literally right there. And guess who hit it? Cal Ripkin.

I have an autographed baseball from Cal Ripkin -- "Dear Andrea, I hope you're feeling better."

HAYS: Josie, I got the other...

KARP: Did you have a broken nose too?

KOPPEL: I didn't actually. It's solid proof I have a hard head. I just a got a tear in my retina.

UNIDENTIFIED FEMALE: Well, another strong woman to talk about in this, Josie, is the announcer for the Giants. This is an historic thing happening, right?

KARP: Yes, this is really great. I just remember back to my own days growing up when the announcer at the World Series games, your own announcer calls out the starting line-ups and they run out there, you know the World Series has really started for you. For a generation of Giants fans, it's going to be a woman's voice. For the first time, a woman, Renel Brooks, is going to be the PA announcer, and that's when the series moves to PacBell in San Francisco.

MALVEAUX: Thanks to Josie Karp in Anaheim and all of our colleagues, and thank you for watching SATURDAY EDITION.

A news alert is just ahead, but first, the president's weekly radio address.

(INTERRUPED BY LIVE EVENT)

BUSH: Good morning. I want to discuss with you steps we are taking to help strengthen the retirement security of America's workers.

More than 40 million Americans save for retirement through 401(k) accounts, making regular contributions and building economic security over a lifetime. A 401(k) provides a chance to invest in the long- term growth of the American economy and an opportunity to build wealth and independence.

Today's workers own more than $1.5 trillion in assets through their 401(k)s. Younger workers have an average of about $10,000 in their accounts, while workers near retirement hold closer to $100,000 in their 401(k)s. This is real money for real workers, and we must do all we can to help make sure it's there for them when they retire.

Turbulence in the financial markets reminds us that every investment carries some risk. Yet American workers also have rights which must be respected and enforced.

I've made five common-sense proposals to help protect the retirement savings of American workers:

First, every worker should get 30-days advance notice before any blackout period, the time when they cannot sell, buy or borrow from their 401(k)s.

Second, corporate executives should have to follow the same rules that every other employee must follow during blackout periods. If you can't sell on the shop floor, you should not be able to sell on the top floor.

Third, workers should be able to sell their company stock after holding it for three years, so that no one's nest egg is tied up in the stock of a single company.

Fourth, investors should receive better...

(END AUDIOTAPE)

MALVEAUX: And President Bush has just released a statement on Bali.

(INTERRUPED BY LIVE EVENT)

MALVEAUX: That is the president giving a statement about the terrorism attack in Bali, really offering his condolences to the Australians who lost their lives, many of them victims of that latest terrorist attack. As we know, as well a few Americans, but really devastating for that particular country.

STARR: And a really clear signal in the Bush administration's mind that the al Qaeda has regrouped. They do believe this is linked to groups in the region that have ties to the al Qaeda. They're looking very much at the explosives, seeing if it has ties to other al Qaeda attacks. Clear signal that most people believe the al Qaeda is back in business.

UNIDENTIFIED FEMALE: And that maybe Indonesia now will be forced to take steps to deal with the large terrorist network that apparently exists that they just haven't wanted to look at yet.

KOPPEL: Well, in fact they have. The Indonesian president, Megawati Sukarnoputri, just issued for the first time these terrorism decrees that the Bush administration has been pushing for for the last really more than a year ever since 9/11. So, I mean, it was a very important move that they're welcoming.

MALVEAUX: Absolutely.

Thank you very much, everybody. And thank our audience for joining us here on SATURDAY EDITION.

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