This is a rush transcript from "On the Record ," November 5, 2008. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Now it's time for "The Donald." The Dow plummeted 486 points today, the worst ever post-Election Day loss for the Dow. And moments ago Donald Trump went "On the Record" about the financial crisis, the election, and much more.

(BEGIN VIDEOTAPE)

VAN SUSTEREN: Donald, nice to have you join us. And, Donald, what happened today? I know that you love real estate, but the stock market dumps 500 points, or almost. What happened?

DONALD TRUMP, CHAIRMAN AND PRESIDENT OF TRUMP ORGANIZATION: I didn't know that you're the first one to tell me it dumped 500 points. I'm just about to turn on my set and find out exactly what happened.

But it has been a total disaster. The banks are not funding deals. The banks are really--I don't know what's going on. A lot of money has been put into the banks, billions and billions of dollars, Greta, but they are not funding deals. It's terrible.

VAN SUSTEREN: Donald, I thought that with this rescue bailout bill, or whatever, the $700 billion, that at least it was going to prime the pump and give people a sense of optimism. But now it's been a couple of weeks and things are happening. And the signs aren't good for those of us not schooled in this. So it looks scary.

TRUMP: It is scary. It's a very scary time. And people are doing things that they've never done before. They're experimenting. It's all one big experiment that nobody knows how the experiment is going to end.

The banks were pumped up with money, but they're not loaning the money, because if you have a prime deal, whether it's real estate or any other deal, and you go to a bank, no matter how strong you are, you can't borrow 10 cents, Greta.

And, I will tell you, this could lead to something very, very bad for the country and for the world.

VAN SUSTEREN: We have a president-elect, President-elect Obama, facing an incredible challenge with this economy. I realize he doesn't take office until sometime in January, but what should he be doing right now?

TRUMP: First of all, this is a hell of a way for him to celebrate his first day with this massive, almost crash of the stock market. So this is one hell of a welcoming--it's welcome to be president, Mr. President. And it's pretty sad.

But what he's got to do, he's got to get the banks to liquefy the system. There's no money in the system, everybody is hoarding their money. The government is giving billions and billions of dollars to the banks and they are using to buy other banks.

I guess they are using it to clean up the balance sheet, but they are using it to loan to people to go out and do deals and build buildings and build housing, or for people to just go out and buy housing.

VAN SUSTEREN: Do you blame banks? If no other bank down the street is going to do it, why if you're the bank up the street would you dare do it?

TRUMP: I'm not blaming anybody. I'm just saying that this whole concept of liquefying the banks is not working because the banks are essentially not loaning the money.

VAN SUSTEREN: Got any ideas?

TRUMP: You've got to get people in there to make sure that the money that was given to them is going to be used. Jobs are being stopped all over the country, buildings are being stopped all over the country, deals are able to be made, deals that were committed to are unable to be made. Banks commit to deals and then they don't make them. They break the deals, they break their commitment. It's a very serious problem the likes of which we have not seen since 1929, Greta.

VAN SUSTEREN: Is it cyclical? At least at the beginning I thought it was cyclical, the pumps get primed and there would be some money back in the system and they would get a little bit better. But we've gone up down, up, down, and it's going on for an awful long time, it seems like.

TRUMP: When you see the kind of variations every week, every day in the stock market, it really is scary. I'm serious. You should be studying 1929, Greta, because that's what it's starting to look like.

VAN SUSTEREN: And why did we get here? Is it because of those mortgages?

TRUMP: They got there because they loaned the wrong money to the wrong people.

VAN SUSTEREN: And so -

TRUMP: You can get a lot of bad people in the system, in all fairness, when you look at what's happened.

But the kind of billions and hundreds of billions that have been pumped into the system and it's not coming out, Greta. Maybe it's solving some immediate problems for institutions. But the money isn't coming out. It's not being put to work.

And that's why Main Street is having such a hard time. That's why on Friday you're going to see unemployment numbers that will make your head spin.

VAN SUSTEREN: The new president-elect, what are your thoughts? Pretty exciting, it's always exciting when we have a change of power, a transition, but what are your thoughts.

TRUMP: It's very exciting we have a new president. It would have been nice if he ended with a 500 point up instead of down. It's certainly very exciting.

His speech was great last night. I thought it was inspiring in every way. And, hopefully he's going to do a great job. But the way I look at it, he cannot do worse than Bush.

Watch Greta's interview with Donald Trump

VAN SUSTEREN: We know how you feel about this.

TRUMP: It's not me, it's everybody. It's been a total catastrophe. That's what happened to Republicans. They got run are out of office because we have president that's been so bad.

And he's been a catastrophe, there's no question about it. He got us into a war we didn't need. You look at the money, we're spending hundreds of billions of dollars on a war, and then people wonder why the economy isn't doing well.

OPEC is ripping us off left and right, the oil countries are just ripping us off left and right.

So you have wars, you have OPEC, all of this stuff. He didn't do anything about it. He sends Condoleezza Rice. She gets off a plane and waves to everybody and then leaves. It's ridiculous.

VAN SUSTEREN: Governor Palin--do you think we'll see her back in 2012? What are your thoughts on that?

TRUMP: I don't know. There's a real question--she certainly made things interesting, but the question is, did she help? I met her a couple of times. She's really nice. I just don't know. I just have no answer for it.

But I think for any Republican, whether good, bad, or indifferent--and I think she was a fine woman. I met her a couple of times and really liked her, and her husband was great. But I think for any Republican to get out of the legacy of George Bush is very tough.

They'll be back, but it's going to take a while. But to get out of that horrible legacy, I think it's very tough, Greta.

VAN SUSTEREN: There is some good news, your big victory in Scotland. What happened?

TRUMP: I had a big victory, but not in this country. I had a big victory in another country. It's pretty sad when I have to go to other countries for victories, right?

We have a great piece of property in Scotland, thousands of acres on the ocean. And we have zoning that a lot of people said couldn't be gotten, and it's going to be a great job.

VAN SUSTEREN: You're building a golf course, a resort, hotel. But why not here in the United States? Why are you going all the way to Scotland for this?

TRUMP: The United States is my place. And I love it just like you love it. But the last eight years have been really down cycle for the United States in terms of respect by the world. I mean, we're no longer respected like we were. We're no longer thought of like we were. Investment coming into the United States, they have other choices now that before they would only even think of the United States.

So it's a little bit difficult. And I went to Scotland, and Scotland ,and I have other many other places outside the United States. And I still invest heavily in the United States, Greta, just so you understand, but the United States is not thought of the way it once was.

And hopefully Obama, President Obama, will do a great job and he will bring that respect back. I hope so.

VAN SUSTEREN: Donald, thank you very much. I always love to have you here "On the Record."

TRUMP: Thank you very much, Greta.

(END VIDEOTAPE)

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