This is a rush transcript from "Your World with Neil Cavuto," January 17, 2008. This copy may not be in its final form and may be updated.

NEIL CAVUTO, HOST: Meanwhile, some very choice words today from Donald Trump about the economy and how the Fed chief is handling it.

I caught up with the Donald just a short time ago.

Take a look.

(BEGIN VIDEOTAPE)

CAVUTO: Ben Bernanke today saying that there is a slowdown in the economy. He seems to be poised to cut rates. He sounded a tad more alarmed than he did when he spoke to Congress a few months ago.

What do you think of the state of the economy?

DONALD TRUMP, CHAIRMAN & CEO, TRUMP HOTELS & CASINO RESORTS: Well, I think the economy is terrible. I think we are absolutely in a recession.

(CROSSTALK)

CAVUTO: In a recession now?

TRUMP: Oh, I think we're absolutely — how can people say we are not in a recession? It's incredible.

And the problem with Ben Bernanke is that he is way behind the curve. He should be ahead of the curve. And now he is coming out and saying, well, maybe I will this, and maybe I will that, and maybe the economy is not as good as we thought.

The economy is terrible. If you look at the economy, other than oil, nothing is going up. What is going up? Now, food is going up a little bit because they are making oil out of our — what used to be our wheat and our other products, which is a whole crazy thing in itself.

But, essentially, unless it is oil-related, what's going up? So, we don't have to worry about — in terms of what we're doing, we don't have to worry about inflation. We have to worry about a recession and maybe worse. We're absolutely in a recession. And the problem is...

CAVUTO: We have got 5 percent unemployment. We still have corporate profits. They're off from where they were. We still have the highest productivity on Earth.

And you have been through many recessions.

TRUMP: That's right.

(CROSSTALK)

CAVUTO: ... certainly worse than this period, right?

TRUMP: But, Neil, I know when I am in a recession.

You know, I think 1990...

CAVUTO: What makes you know it? What do you feel and see?

TRUMP: Because I am in the real estate business. And I'm lucky that I'm in Manhattan. And I am just saying, I wonder when it hits Manhattan, to be honest with you, because how can it be that Manhattan is stronger than ever, and everything else is dead?

CAVUTO: So, you just think it is a matter of time for Manhattan?

TRUMP: Personally, I think it is a matter of time.

CAVUTO: Really?

TRUMP: I mean, when Merrill Lynch lays off four million people, and when Citibank lays off a trillion people, I mean, look at the numbers. I mean, they're talking — certainly — and I am speaking against myself, but it doesn't make any difference to me, because it gives you buying opportunities.

The fact is, I think Manhattan certainly will be affected at some point. But, outside of Manhattan, it is — it's a depression in real estate. Now, I am talking real estate. But I see other things also. And I see a lot of weak signs.

The problem with Ben is that he should have been ahead of curve. He should have been cutting interest rates six months ago more than he did, not now, after he sees what is happening.

CAVUTO: So, if you were Ben Bernanke now, regardless of what you cut, it isn't enough, and it's too late?

TRUMP: Well, I would say that — well, there's nothing you can do. He missed a great opportunity. He could have been a leader. Instead, he's a follower. And I would cut it a point.

CAVUTO: A point?

TRUMP: Yes, I would cut it 100 basis points.

CAVUTO: in one meeting?

TRUMP: In one meeting. I would cut it 100 basis points. I think it's going to end being...

CAVUTO: Do you ever want to take a pay cut and be Fed chairman?

TRUMP: I would be great.

But I think it would be — in my opinion, he's going to go down 175 basis points. I think that's what it's going to be. I think that is what it should be.

CAVUTO: Over the course of, what, like a year or so?

TRUMP: In fact, I watched somebody from Goldman Sachs being interviewed, and they were saying 175 basis points. I happen to agree with that.

I think...

CAVUTO: Wow.

TRUMP: ... it's going to end up being 175 basis points.

And because the cuts take so long, you know, a year and two years, to really have an impact, I would do it more quickly. I wouldn't do 175. I would do 100 basis points right now.

CAVUTO: Wow.

All the presidential candidates are saying, because things are slowing down — they are not all in the recession camp, although most of the Democrats say we are — we have to have fiscal stimulus. We have to have a lot of it. And that was being debated today on the Hill.

What do you think of that?

TRUMP: Well, I think fiscal stimulus is very, very dangerous. I think certain kind of tax incentives are great, and that's a great stimulus.

When I hear people trying to protect others that made terrible deals on mortgages, I really think that's the banks' problems. If the banks made all of these terrible deals, whether it's Citibank, or whether it's Merrill, or whoever it may be, I think they have to suffer a little bit. And they will survive, but they have to suffer.

I don't think you can tax people that made fair mortgage deals on their houses and are paying their debt and paying their mortgages with — you know, with what we are doing, with what they're saying we're going to do. They're going to tax everybody. People made bad deals.

You know, in business, we all make bad deals. I made bad deals. The best deal-makers make bad deals. They made bad deals. They will work it out with their bank. Hopefully, they will work it out with their bank.

But should the bank be helped because they made all these bad deals? Maybe they should suffer. Maybe that bank should go under. Maybe that bank should be taken over. I don't see how the government can help.

If you look at Citibank, I mean, they are selling their soul, OK? They are selling their soul. It's amazing, when you think of it.

CAVUTO: Are you troubled by all these foreign investors? Kuwait?

TRUMP: Well, I think it's terrible.

Think of it. Terrorist countries — terrorist countries — and communist countries are coming in to bail out the United States. Pretty sad, isn't it?

CAVUTO: But, you know, Donald, not one prominent candidate, and not Chuck Schumer on Capitol Hill or those who have influence on these matters have criticized all this foreign investment.

Now, they — they hopped on the ports deal, when a Middle Eastern country wanted to buy a chunk of that. But not one has said anything bad about this.

TRUMP: Well, you know, experience is an interesting thing.

I used to say brainpower is more important than experience. But they are both important. In 1990, when the markets were horrendous, and real estate was down, and everything — everybody was really in trouble, the Japanese came in.

And I used to go, this is terrible. They're buying up all the real estate. Well, you know what? Four or five years later, they went home and they just got clobbered. They got clobbered. Nobody lost so much money as the Japanese.

So, it was the same thing. Now you have others coming in. Let's see how they do. We will be — we will come back. You know, we're a great nation with a — we have really smart people. And we will come back.

But, in 1990, when the Japanese came in, everybody was against it. I was against — I thought it was terrible. In the meantime, they came in. They kept prices up a little bit. They went home. They lost their ass.

CAVUTO: So, are the...

(LAUGHTER)

TRUMP: And I think the same thing is going to happen.

CAVUTO: So, are the Chinese and the Kuwaitis and Abu Dhabi, they're all going to...

(CROSSTALK)

TRUMP: I wouldn't be surprised. You know what? I wouldn't be surprised.

CAVUTO: Really?

TRUMP: Crazy things happen.

CAVUTO: Yes.

TRUMP: I mean, as an example, we should have a president that calls up the illegal monopoly, which I call it, OPEC. It's an illegal monopoly.

By the way, if you ever formed that monopoly on some business in the United States, they would put you in jail. You are not allowed to do it. And, yet, the oil countries and the oil companies, what they are doing is absolutely outrageous.

So, we need a president that is going to call them up and say, get those prices down, and I mean now, because they can do it. They just sit there. They say, let's make it $90.

The biggest problem we have, in all fairness to Ben, he will lower interest rates. You watch what happens. Oil prices will go up. So, he lowers interest rates in order to stimulate the economy, but the oil-producing states and the oil companies raise oil prices by a similar amount, same number.

CAVUTO: So, it comes out as a wash?

TRUMP: It is terrible.

CAVUTO: Let me ask you...

TRUMP: Somebody...

CAVUTO: ... do you have a candidate or someone who can lead us in the right direction?

TRUMP: Well, I — I know all of the candidates.

CAVUTO: Who do you prefer?

TRUMP: And — well, I don't want to say who I prefer, because I would like them to win. But — so, I don't want to say who I prefer.

CAVUTO: But you gave money when Hillary Clinton was running for Senate, right?

(CROSSTALK)

TRUMP: Well, I support Hillary. I think she's fantastic.

I supported Rudy. I think Romney is doing a very good job. I mean, there's — every one of them, they are very...

CAVUTO: All right. Let's say you have...

TRUMP: By the way, these are very different candidates, all of them. You're talking about very different people.

CAVUTO: OK.

Any narrow preference for you?

TRUMP: I don't want to say.

(CROSSTALK)

CAVUTO: All right. If they were all at this table next to us here, and it was — you had to fire one, you know, say, "You're fired," which I love when you do that, who would it be?

TRUMP: Well, probably one of the ones down in the 1 percent category, OK?

(LAUGHTER)

TRUMP: But, no, they all have...

CAVUTO: So, Kucinich would have to go?

TRUMP: By the way, these are very, very different candidates, in terms of the economic proposals, in terms of everything. Some want to cut taxes. Some want to raise taxes.

CAVUTO: Barack Obama, what do you think of him?

TRUMP: Oh, he is very capable. I don't know him at all. He's one of the ones I don't know at all.

I didn't like the fact that he made a bad real estate deal in Chicago...

(LAUGHTER)

TRUMP: ... because I don't like to see my president be taken. But that can happen.

CAVUTO: Right.

TRUMP: But I certainly think he is a very capable guy and a great speaker.

I was watching one of his speeches, and it was absolutely terrific. I think he's inexperienced at this point, but we will see what happens.

CAVUTO: John McCain.

TRUMP: I know him a little bit, very amazing comeback.

Very few people could have done what he did, because, four months ago, he — most guys would have hid their head in shame with what happened, between his campaign, and all the guys with the fees that they were getting, and they wiped out his treasury.

CAVUTO: Right.

TRUMP: And, all of a sudden, he ends up coming back so strong.

I like him. He's tough. He's smart. And he made an unbelievable comeback that very few people could have done. And you have to respect that.

CAVUTO: You know, it wasn't that long ago you toyed with running for president. In fact, there was a movement of people pushing you. And you polled quite well. You — you...

TRUMP: There still is a movement. But I love what I'm doing, but there still is a movement.

CAVUTO: Would you ever entertain politics?

TRUMP: I don't think so.

I think I am too honest, not to say that politicians are dishonest. Of course, many of them are. But I'm — I like speaking my mind.

I will give you an example. If I were president, you would have $30 oil right now. I would call up Saudi Arabia. I would call up some — and I would say, that (EXPLETIVE DELETED) price is coming down, and it's coming down now.

And you know what? They would lower that price so quickly. And it would be so easy.

CAVUTO: What if they didn't?

TRUMP: They will. They will. They're only there because of us. If we leave, if we...

CAVUTO: They have got other customers, right?

TRUMP: Excuse me.

CAVUTO: They got India and Japan, and China soaring, right?

TRUMP: If we don't protect them, they are gone. They're gone. We protect them. We keep them in business. And I would get that lowered.

The other thing is...

CAVUTO: So, you would have a Tony Soprano moment with them?

TRUMP: I would tell them to get their prices down, and get them down fast.

(LAUGHTER)

TRUMP: I would say, you get your price — you get them down fast.

(END VIDEOTAPE)

CAVUTO: All right.

You can catch my entire interview with Donald Trump conducted in his offices, where there are no lights, by the way, at 6:00 p.m. Eastern time on the FOX Business Network.

He has a lot more to say about some colorful characters and that "Apprentice" thing as well.

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