This is a rush transcript from "Fox News Sunday," August 30, 2015. This copy may not be in its final form and may be updated.
CHRIS WALLACE, HOST: I'm Chris Wallace.
Donald Trump keeps rising in the polls as Hillary Clinton and Jeb Bush slip and fight back.
DONALD TRUMP, R-PRESIDENTIAL CANDIDATE: Look, I've done a great job. Maybe a little controversial, but that's OK. I've done a great job.
HILLARY CLINTON, D-PRESIDENTIAL CANDIDATE: Now, don't get distracted by the flamboyant front-runner. Most of the other Republican candidates are just Trump without the pizzazz or the hair.
JEB BUSH, R-PRESIDENTIAL CANDIDATE: For him it's all about him. He should be treated like a front-runner, not as an alternative universe to the political system.
WALLACE: How is Trump shaking up the race for president?
We'll ask New Jersey Governor Chris Christie as he's being browned out as the tell is like it is candidate. It's a "Fox News Sunday" exclusive.
Plus, a wild week on Wall Street. Is it just the beginning?
We'll break down the impact on your 401K with Liz Ann Sonders of Charles Schwab, and discuss Beijing's role with Nick Lardy, an expert on Chinese markets.
Then, murdered on live TV.
JEFF MARKS, GENERAL MANAGER, WDBJ: It is my very, very sad duty to report that Alison and Adam died this morning.
WALLACE: And posted online for the world to see.
UNIDENTIFIED MALE: We've got to do something about crazy people getting guns.
WALLACE: Our Sunday panel weighs in on guns, race, and social media.
All right now on "Fox News Sunday."
WALLACE: And hello again from Fox News in Washington.
Well, breaking news in the race for the White House, a new poll shows self-described socialist Bernie Sanders closing the gap on Hillary Clinton in Iowa. The Des Moines Register poll shows Sanders now within seven points of Clinton among likely Iowa caucus goers. Clinton has lost one-third of her support since May.
On the Republican side, Donald Trump leads with 23 percent in Iowa, but Dr. Ben Carson is now at 18 percent, just five points behind the front-runner.
Meanwhile, no candidate has spent more time in the first primary state of New Hampshire than New Jersey Governor Chris Christie. This weekend marked his 20th visit to the state.
Governor Christie joins us today here in Washington.
And, Governor, welcome back to "Fox News Sunday."
GOV. CHRIS CHRISTIE, R-N.J., PRESIDENTIAL CANDIDATE: Happy to be back, Chris. Thanks for having me.
WALLACE: Let's start with the latest Real Clear Politics average of national polls. It shows that you have slipped back to 11th place with 3.5 percent support.
Governor, how damaging do your campaign, if you don't make it into the main debate on CNN in a couple of weeks, and by all right, shouldn't be Carly Fiorina be on that stage replace you in the top ten if she's leading you in the polls?
CHRISTIE: Well, listen, first off, I'll be on the stage at the Reagan Library, and I'm not worried about that.
And, listen, Carly Fiorina has done a great job and she deserves to have her voice heard as well. We all play by the rules and do what we need to do. But I'll be on the stage. I'm not worried about that at all.
WALLACE: And what about slipping back? I know you say the polls are early, but it's better to be at 23 percent than 3 percent.
CHRISTIE: Well, always is. But let me tell you this, Chris, in 2009 when I ran for governor, the first time, I was given outspent 3-1 bring an incumbent Democrat, in a Democratic state. No one thought I was going to win.
I've been an underdog my entire portfolio career, and what matters is the power of ideas and campaigning. Campaigns matter. That's why we have them.
So, we'll go out there and we work hard and we let people know what to do for the future of the country. Restore lawful, you know, work for this country, we'll do what we need to do.
WALLACE: All right. We'll get into all of that. Let's talk about the jockeying amongst you and the other candidates.
You've been going after one of your rivals, Jeb Bush, pretty hard recently. Here's a clip.
(BEGIN AUDIO CLIP)
CHRISTIE: When you haven't been in a relevant campaign as a Republican since 1998, you're going to continue to make the kind of mistakes that we see Governor Bush making.
(END AUDIO CLIP)
WALLACE: You say Jeb Bush is out of touch with the current debate in this country?
CHRISTIE: Well, listen, it's just a factual statement. He hasn't been in a relevant campaign since 1998. So, it's a factual statement.
I don't have any problem as I've told people all along, I tell it like it is. I say what I mean, and I mean what I say and he hasn't been.
And, listen, guys like me and Scott Walker and Marco Rubio and John Kasich, we've been out there for the last six years fighting the fight for conservative Republicans across this country, me in New Jersey fighting against the Democratic legislature every day, vetoing more than 400 bills as governor.
And Americans for Tax Reform says I vetoed more than any governor in American history. So that's the relevant fight to the day, and that was a factual statement, I stand by it.
WALLACE: I think it's fair to say the candidate who's really been hurting you, and perhaps all the other candidates in the race, is Donald Trump. Your campaign slogan is "Telling it like it is", and a lot of people thought that you would campaign and make your mark as the kind of in your face, larger than life candidate, but haven't you, to a sense, honestly, been drowned out by Trump?
CHRISTIE: Well, first of all, I always speak honestly, Chris.
And the fact is that, no, listen, there's 17 people in the race. So, everyone's going to have their moment to be able to speak their minds and be able to get their message out there. And what I'm going to do over the course of the next five and a half months before the Iowa caucuses and the New Hampshire primary is to get out there and talk about the important issues that people care about, and stand up and put my record and my vision forward for the American people.
You're going to do that no matter who happens to be in the first place at any moment in these polls. And now, it's Donald. You know, in three weeks, it could be somebody else.
WALLACE: But part of this is comparison shopping for the voters. You've been quoted as saying this week that some of Trump's solutions, his proposals are too simplistic, that there's no "there" there.
CHRISTIE: Well, what I said was that -- I was asked specifically about the immigration proposal and said it was simplistic and I put forward a more forward proposal. And, yes, it is comparison shopping, but the comparison shopping is not only about personality, it's also about ideas. And it's about who can get it done, you know?
When you look at what I've done in New Jersey, Chris, every day in a state that's one of the most Democratic states in the country, a Democratic legislature, every day, still cut business taxes, still created nearly 200,000 jobs in the last five and a half years, in a state that had no private sector grown in the eight years before I became governor.
So, we're doing the things that need to be done. We shown we can do it. I'll tell you this -- the guy who vetoed 400 bills so far as governor in New Jersey, the guy who's vetoed more income tax increases than any governor in American history is the guy to send over to Capitol Hill to get Congress in line, because nobody likes what's going on in that building.
WALLACE: In one of your recent TV ads, and you just referred to it a moment ago, you talk about yourself as a law enforcer. And you mentioned that Hillary Clinton thinks the law doesn't apply to her. And in an interview this week, you suggested that she should be prosecuted.
And I guess my question is for you, as former U.S. attorney, don't we need an investigation first?
CHRISTIE: Listen, I said I think there's sufficient grounds there for her to be investigated, and if what she did is true, then she should be prosecuted because --
WALLACE: On what grounds?
CHRISTIE: Listen, there's two right now that seem apparent to me -- one, is obstruction of justice. If those e-mails were deleted, in fact, before she wound up -- before or after rather the subpoena was issued by Trey Gowdy.
And secondly, there's the issue of the mishandling of information. Now, that's what David Petraeus was prosecuted for. That's what Sandy Berger was prosecuted.
And my point is this -- no one is above the law. And unfortunately in the Obama administration, there's been lawlessness going on. You have sanctuary cities where the president turns his back and says, you know, if you don't to want enforce the immigration law, you don't have to. Marijuana -- Colorado, Washington, you don't want to enforce the federal law, you don't have to.
And, apparently now, Hillary Clinton has caught this disease as well. She believes she certain laws only apply to her.
And the worst part of this, Chris, is her arrogance. Her arrogance is that she won't answer questions. You heard it yesterday or two days ago with Ed Henry. He asked three questions and she said, "I'll answer one because I think that's what you deserve." Well, thank you --
WALLACE: Entitled too.
CHRISTIE: Yes. Well, thank you very much, your highness. We appreciate it. But this is not royalty in the United States. You have to battle, fight, and answer questions by the American people to become president of the United States. This is not a familial ascendency.
WALLACE: Two points on that, however -- first, because you've had your own problems during the height of the bridgegate scandal that turns out that you and one of your top aides were texting each other, and it turned out that 12 of those texts were deleted. And also when you turned over your e-mails to the state legislature, the only e-mails that you turned over were from your, your private Yahoo account.
And as in the federal government, the state government in New Jersey says if you're conducting government business, it should be on government e-mail contacts.
CHRISTIE: Yes, my government business was conducted on a government email account. And the one e-mail you're referring to and the only one that they've released, it's the only one they've released, involved a press release.
So, let's all remain calm. My press secretary says it's my private email account, I'm sure, inadvertently and I responded to it.
We cannot compare that, can we, to someone having a private email server in the basement of their home where they did all of the government business on a private e-mail server in their basement? We can't compare that to having national security -- we're really not, Chris, are we, comparing a press release to having national security and classified documents running through a server that's not protected by the federal government that could be hacked by the Russians, the Chinese, or just a group of 18-year-old hackers who want to have some fun?
We're really not comparing the fact that she's wiped away tens of thousands of e-mails that had relevant information on them. Because she just believed she's entitled to do that.
Now, let's talk about lawlessness and let's talk about openness. Everything I've done as governor has been an open book and I've answered every question anybody's have, ever had to answer. Can you hold Mrs. Clinton to that standard?
Because I'll tell you something, I haven't seen it. And the fact is the American people need to know they have a president who's willing to be open and honest and direct. And Mrs. Clinton is the opposite of those things, 180 degrees opposite.
WALLACE: All right. Hillary Clinton went after Republicans again this week for what she calls so the-called "war on women". Take a look.
(BEGIN VIDEO CLIP)
CLINTON: Extreme views about women -- we expect that from some of the terrorists groups. We expect that from people who don't want to live in the modern world. But it's a little hard to take coming from Republicans who want to be the president of the United States.
(END VIDEO CLIP)
WALLACE: Now, she didn't mention you by name, but you are one of the Republican candidates who want to defund -- and in fact, in the state of New Jersey, you have defunded Planned Parenthood.
What do you think of that comparison?
CHRISTIE: Well, there's a uniter, isn't it? Comparing Republicans to terrorist groups. There's a real uniter. That's the woman you want sitting in the Oval Office to bring our country back together.
That's a disgrace and she's a disgrace. The fact is this --
WALLACE: Wait, Hillary Clinton is a disgrace?
CHRISTIE: She's a disgrace for saying that, for comparing Republicans to terrorist groups -- don't let her go on that, Chris, that's awful.
WALLACE: That was nowhere near --
CHRISTIE: That's a disgrace. It is a disgrace. Can you imagine if we compared the Democratic Party to terrorist groups? Can you imagine the outrage in the mainstream media for that? Yet, she stood up and said that Republicans are like terrorist groups.
Well, here's what I don't think mainstream America's for, I don't think mainstream America is for an organization getting federal funding, who kills children in the womb, in a particular way, so that it maximizes the value of their body parts on the open market for sale for profit. Now, if Mrs. Clinton thinks that's what mainstream America likes, I'm happy to have the debate with her.
But, of course, she won't even answer those questions because she doesn't even want to talk about what's really going on at Planned Parenthood. She just wants to talk about these vague generalities about war on women.
But I'm not going to be someone who's going to stand up and allow her to call my party "terrorists", because we're not.
WALLACE: OK --
CHRISTIE: And I say one other thing -- I can't wait, I can't wait until next September to get on stage with Hillary Clinton as the Republican nominee, and the people know, there will be no one better to prosecute the case for an optimistic, hopeful, better America, and against a kind of garbage than I would be against Hillary Clinton.
WALLACE: Well, let's talk about a question for this September, and that is that there's going to be a fight in that building behind me about the budget. And some people are saying, as part of the budget, we're going to demand Republicans, we're going to demand defunding Planned Parenthood.
Would you be willing to shut down the government over the fight over whether or not to defund Planned Parenthood?
CHRISTIE: See, Chris, here's the difference between Washington, D.C. and being a governor -- I got done. I don't have to argue about what whether they shut down the government or not. In New Jersey, six years ago, I defunded Planned Parenthood. And I made it stick. We viewed it eight different times in New Jersey, and we've made that veto stick each and every time, despite veto override attempts.
That's what an effective executive does and an effective leader does.
WALLACE: OK. But here, you've got a Democratic executive who would veto if Congress were somehow to pass a budget that defunded Planned Parenthood.
CHRISTIE: Well, you know what? Maybe we should test the president, because in the end, we haven't done anything yet in Congress to test him. I think we should be putting it on his desk. I think we should be passing repeal and replacement of ObamaCare and putting it on his desk.
Let the United States people see, let us see who the real obstructionist is in Washington, D.C.
We elected a Republican Senate and a Republican House to get things done. Let them put those things on the president's desk and let the president show the American people that he doesn't want to run the government.
See, I think Republicans to want run the government, and in New Jersey, we have not had one government shutdown in six years, despite having a completely Democratic legislature. That didn't happen by accident, Chris. That's real, strong leadership and that's what we should do.
WALLACE: OK, finally in the time we have left, I'd like to do a lightning round. Quick question --
WALLACE: -- and quick answers. Good.
CHRISTIE: I love this.
WALLACE: You love this? OK, all right.
Here we go.
You're getting blowback this weekend because you suggested that we should track foreigners who were in this country on visas and they overstay them the same way that FedEx tracks packages. And critics are saying, "People aren't packages".
CHRISTIE: They're not, but what my point was this is once again a situation where the private sector laps us in the government with the use of technology. Let's use the same type of technology to make sure that 40 percent of the 11 million people here illegally don't overstay their visas. If FedEx can do it, why can't we use the same technology to do it?
WALLACE: Are you going to be able to tell somebody over -- I mean, they don't have a number, you know, a label on their wrist.
CHRISTIE: We can do it. And we should bring in the folks from FedEx to use the technology to be able to do it. There's nothing wrong with that. And I don't mean people are packages. So, let's not be ridiculous.
WALLACE: You say the growth of Medicaid could bankrupt the country, and yet, you expanded Medicaid in New Jersey under ObamaCare.
CHRISTIE: Yes, I expanded Medicaid because it was right for New Jersey because I had had three liberal Democratic governors before me that so expanded Medicaid that we actually made money in New Jersey by expanding Medicaid and lowered our costs in emergency rooms across the state.
My job's to work for the taxpayers in the state of New Jersey. When I become president of the United States, then they're going to get that same effort for me for the entire country.
And remember this, Chris, no tax increases for me in six years, $2.5 billion left in spending. We have stood up to a Democratic legislature and gotten the job done, unlike people here in Washington, D.C. who haven't.
WALLACE: Should --
CHRISTIE: Little long for lightning, but keep going.
WALLACE: Yes, you broke the rules.
Should businesses be allowed to decide whether or not to serve gays or anyone else based on religious freedom?
CHRISTIE: Religious institutions should be able to decide how they conduct their religious activity. The rest of the folks in the United States need to follow the law.
WALLACE: Meaning, if I am a baker and I'm being --
CHRISTIE: Listen, I'm not --
CHRISTIE: Christie, I'm not going to get to every example, a bakers, a candle stick maker.
WALLACE: No, I'm asking --
CHRISTIE: I'm not getting into every example.
I'm someone in this country who believes in law and order. I'm a former prosecutor. I'm the only former prosecutor on that stage in California. We need to enforce the law in this country in every respect, not just the laws we like, but all the laws. This way we won't have sanctuary cities in this country when I'm president of the United States, and we won't have people getting high on marijuana in Colorado and Washington if the federal law says you shouldn't.
WALLACE: Finally, what should voters think of any of your rivals who say we can preserve Medicare and Social Security without cutting benefits?
CHRISTIE: They're not telling the truth. They're just not telling the truth.
Or, I guess, the alternative could be, Chris, they want a massive tax increase on the American people. If they want that, that's fine.
Here's my attitude about it, you have two choices, to either get rid of some benefits for the very wealthiest in America who don't need a Social Security check and I've talked about that, or you can give the government that's already lied to us and stolen from the trust fund more of your money.
I'm going to tell you the truth -- I don't want to give the government more of our money so they can lie more to us and steal more from us.
WALLACE: Governor Christie, thank you. Thanks for talking with us.
CHRISTIE: Great to be on, Chris.
WALLACE: You're in midseason form, aren't you?
CHRISTIE: You've got it, baby. I'm hot. Ready to go.
WALLACE: I don't think I've ever had a candidate -- Donald Trump might say that, I'm hot, baby.
All right. Up next, Sunday group --
CHRISTIE: Better yourself, Chris. Better yourself.
WALLACE: Up next, our Sunday group joins to discuss another remarkable week, why aren't they laughing, remarkable for both Republicans and Democrats in the race for the White House.
Plus, what do you think about Hillary Clinton comparing some GOP candidates to terrorists? Let me know on Facebook or Twitter @FoxNewsSunday and use the #fns.
(BEGIN VIDEO CLIP)
TRUMP: OK, who's next? Yes, please?
JORGE RAMOS, UNIVISION: Mr. Trump, I have a question --
TRUMP: Excuse me, sit down, you weren't called. Sit down. Sit down. Sit down.
RAMOS: I have the right to ask a question.
TRUMP: No, you don't. You haven't been called.
RAMOS: I have the -- I have the right to ask a question.
TRUMP: Go back to Univision.
CLINTON: Today, the Party of Lincoln has become the party of Trump.
(END VIDEO CLIP)
WALLACE: Hillary Clinton using Donald Trump's confrontation with Univision's Jorge Ramos to attack the entire Republican Party.
And it's time now for our Sunday group: syndicated columnist George Will, Christi Parsons, who covers the White House for The Los Angeles Times, the head of Heritage Action for America, Michael Needham, and Sheryl Gay Stolberg of "The New York Times".
Well, let's go back to "The Des Moines Register" poll on Democrats, again, it shows Bernie Sanders has now closed within seven points of Hillary Clinton as she has lost one-third of her support since May among likely Democratic caucus-goers.
George, the person running the poll said that this feels like 2008 all over again -- referring of course to the race in which Hillary Clinton had a big lead, then got swept by and beaten by Barack Obama.
What's going on?
GEORGE WILL, SYNDICATED COLUMNIST: Well, although she was just seen there complaining about Donald Trump, she should get up every morning and thank the Lord for Donald Trump because he's distracting attention from her troubles.
Now, imagine what she'd be in this poll if all of the attention of the country were focused on her, because the more she campaigns and the more people see of her, the less they seem to like her.
Partly, this is because in the Republican Party, the energy is on the right, Democratic Party is on the left, and Bernie Sanders is where the energy is. But a very talented Democratic poll-taker, Peter Hart, says go back to every election since the Second World War, start with Truman-Dewey, with the exception of the Nixon elections, the most likable candidate wins.
Take all your fancy measurements, likability matters, and people do not seem to like the product.
WALLACE: You're talking about Hillary Clinton?
WALLACE: Christi, I'm sure somebody sells looking at that poll, is that vice president's residence here in Washington, Joe Biden. As somebody that covers the White House, best sense, is he getting into the race or isn't he?
And from your reporting, who would the president and his top advisors favor if it ends up being Clinton versus Biden?
CHRISTI PARSONS, LOS ANGELES TIMES: It's so hard to tell if the president will really get into in the race. What is clear is that he is looking at it very seriously. And I think it's going to be a while before we have a decision. He has said that by the end of the summer, he would let us know what he is thinking.
But in the last week, The L.A. Times has reported that it may be January or February before Joe Biden makes up his mind about --
WALLACE: But, wait, you're saying he wouldn't get in time for the first Democratic debate in October?
PARSONS: Maybe not. If the thinking is that he wants to preserve the ability to get in later, he may not be on that first debate. Of course, it'd be helpful, but the thinking among the folks around Biden is that he doesn't have to be out there campaigning like everybody else.
If this were a situation where he did get in closer to the primaries in the early caucus states, then he's known there, people like him. He's got some folks in the party who really like to see him run and would be there to help him with that choice.
WALLACE: Is the thought then that this would be a kind of "Hillary collapse as coming to pick up the pieces strategy?
PARSONS: I think some people see it that way. But I also think there's a big respect factor going on here. And this is something we been hearing for months at the White House about Joe Biden. There's a lot of respect for the 40 years he spent in politics and for the service he's given to the Obama administration.
And all along, the idea has been -- he has the right to make the choice based on his own considerations. And I think that's what you saw.
You asked me what -- does the president favor one over the other? Right now, the president is going to great lengths to do a couple of things. One is to not show favoritism between the two. I think he really -- he has made it clear to people around him that he likes both, thinks both would be great. But he also doesn't want to disrespect his vice president. And foreclosing, putting heavy pressure from the sitting president, he feels would be insulting.
WALLACE: And also, obviously, Biden is going through a personal tragedy, it's not just political for him.
Michael, let's look at the new poll when it comes to Republicans. Donald Trump is still leading, but Dr. Ben Carson is now at 18 percent, just five points behind Trump and all the governors, all the senators are in single digits. What is going on?
MICHAEL NEEDHAM, CEO, HERITAGE ACTION FOR AMERICA : Well, one of the great myths is that Washington, D.C. is broke, and Washington is not broken, it's a finely tuned machine that works well for incumbent politicians, their consultants, and the K Street lobbyists who get rich off the gain.
And so, the fundamental question of this election, with all the insiders, Donald Trump, Carly Fiorina, Ben Carson, and even somebody like Ted Cruz get right is do you understand that Washington, D.C. is a swamp, and are you coming to drain it? That's why you're seeing the outsiders take off.
And on top of that, Donald Trump is adding to the conversation, pointing out that there's a bipartisan consensus not to build the wall. Carly Fiorina is doing a great job of highlighting cronyism that pervades Washington, D.C. Ben Carson is talking about the lack of virtue.
And all of them are absolutely in touch with the populist, conservative vent of Republican primary vote voters who are absolutely sick as they learn more and more about how corrupt the rigged game of Washington, D.C. is. It's the status quo.
NEEDHAM: It's not just Washington, because, you know, you've got the governor of Wisconsin, you've got the governor of Louisiana -- a variety of, quote, "outsiders" at least in terms of Washington, it seems that the political class, not just the Washington political class.
NEEDHAM: That's exactly right. The political class in this country is failing our nation. Our nation wants to talk about things like the fact that they can't afford to send their kid to college, that they're anxious about whether they're going to have a job, worrying about health care premiums.
Politicians run on those things. Politicians run in 2014, we'll stop Obamacare, we'll stop the unlawful amnesty.
What do they do when they actually get elected? They go in and true to pass a patent reform bill that K Street wants. They go in there and reauthorize No Child Left Behind. George W. Bush's failed education bill. The politicians, the political class in the country is ignoring the will of voters, that's what people are rebelling against and that's what Donald Trump, Carly Fiorina, Ted Cruz, Ben Carson, all of these insiders candidates are tapping into.
WALLACE: Meanwhile, Sheryl, to go back to the Democratic race, your paper, The New York Times, had a fascinating story this week which they served 75 Democratic officials, Democratic candidates running in state races, Democratic donors who expressed growing frustration, maybe not with the details of the e-mail scandal, but with Hillary Clinton's seeming inability to get ahead of it and to put it the to rest.
SHERYL GAY STOLBERG, THE NEW YORK TIMES: I think that's absolutely right. The paper surveyed about 75 Democrats -- Democrats are absolutely apoplectic over this. Ed Rendell, the former governor of Pennsylvania, said that the Clinton campaign has handled this atrociously.
And the concern, as you said, is not so much with the details, was there classified information or wasn't there -- but really with the broader perception that Hillary Clinton has done something that most Americans wouldn't do or wouldn't expect a government official to do which is conduct public business on a private server. And this issue isn't going to go away.
Now, some Democrats feel that Mrs. Clinton did a better job this week. She, in Iowa or Nebraska rather accepted responsibility, she said, "I know that maybe this wasn't the best decision, I accept responsibility for doing this."
But, you know, this is a long time coming. This kind of explanation, and she's got a long way to go. In October, she will testify before the House on Benghazi. The issue of these e-mails will be front and center --
WALLACE: Also that the FBI, which has a hold of her server. Who knows what they're going to find on that.
STOLBERG: That's true. But I do think the spectacle frankly of her becoming a witness in a House hearing is just going to kind of continue this churning over her e-mails that it casts for her campaign.
WALLACE: Do you think the Democratic grassroots or at least in this case from the Democratic state local level officials, that there's a growing sense maybe we need somebody other than Hillary?
STOLBERG: Well, I think -- I think this is a big reason frankly that we're seeing Joe Biden considering a run for the White House, because there is a growing unease, and we're also seeing, you know, Bernie Sanders as you mentioned, bubble up for an entirely different reason, because there's an energy, as George said, in the Democratic Party with the progressive side of the party. That is not the Hillary Clinton wing of the party.
WILL: I agree with that. Energy matters. And right now, the people translating the energy and noise are the ones prospering. But there's an aspect on "The Des Moines" register on the Republican side that interests me. It's favorable/unfavorable.
To Republican candidates are over 70 in favorable, Ben Carson at 79, Scott Walker at 71. Both have very low, unfavorables, what do the two have in common? They're both calm.
Dr. Carson is almost sleepy. And Walker was that kind of Minnesota, sorry, Wisconsin niceness and Midwestern calm -- maybe the voters are saying, making a disconnect between those two shout and those who are nicer.
NEEDHAM: There's no politician that does a better job that Senator Mike Lee of Utah of combing that optimistic vision with a willingness to take on the broken Washington status quo. But to mix that second part, absolutely disqualifies you to be the Republican nominee. And so, they're going to have to as George is alluding to, channel both that optimistic vision and the willingness to take on the status quo.
WALLACE: All right. We have to take a break here, but we'll see you a little later in the program.
Up next, the stock market's wild week -- what happens next and what impact will China slowdown have on the U.S. economy?
(VIDEO CLIP PLAYING)
WALLACE: Some sights and sounds from the Lower Ninth Ward in New Orleans on this tenth anniversary of the weekend Hurricane Katrina devastated that city. It's been a wild week on Wall Street as the markets swung dramatically in response to a big sell-off in China. How will it impact your 401K?
Joining us now, Liz Ann Sonders, chief investment strategist for Charles Schwab, and Nicholas Lardy of the Peterson Institute for International Economics, who's an expert on Chinese markets.
Liz Ann, I think it's fair to say we saw some extraordinary shifts in the U.S. markets this week. Let's put them up on the screen. Six straight days of losses in which the Dow fell 1,900 points, then Wednesday and Thursday, the Dow gained almost 1,000 points. Let me ask you the question I guess everybody's asking, what do you expect when the markets open tomorrow and in coming days?
LIZ ANN SONDERS, CHARLES SCHWAB, INC.: Oh gosh, I wish I had the ability to forecast what the market was going to do tomorrow or any other day. I think what was most remarkable about the week is if you went on vacation and you weren't paying attention on a day-to-day basis, you'd see the headline at the end of the week that the market was up about 1 percent, and you'd think, oh, I didn't miss much, but it was extraordinary, the volatility that happened therein. And I think it's a test for investors in terms of their ability to stick to their discipline.
WALLACE: Any sense of whether we're headed up, down, or whether we're going to continue to see these wild swings?
SONDERS: The historical pattern suggests that there is a chance that you retest the recent lows, but if you do so, it probably is in a much less dramatic fashion. And that'll be an important point to watch, because normally those retests, when they happen, if they're less dramatic, that's usually a sign that from there, you're in pretty good shape. So I wouldn't be surprised to see a retest.
WALLACE: All right, so if it's hard to predict the future, let me ask you to review the past. Why the big ups and downs over the last couple of weeks? How much of it is a result of the big sell-off in the Chinese markets, and how much of it is just the normal correction in a bullish market that has been six and a half years old?
SONDERS: I think it's more the latter than it is the former, Chris. Because many of the problems that are being blamed for what happened in the market last week are not new problems. The crash in commodity prices, the weakness in China's growth, uncertainty about Federal Reserve policy here in the United States. These are not brand new factors, so I would consider them more the straws as opposed to the causes. I think the market has gotten a bit overbought. There was too much enthusiasm, a lot of complacency. It's been a long time, almost four years since the last 10 percent correction. By the way, they normally come about once a year. So I think these were just the excuses or the straws that broke the back of the market.
WALLACE: Okay, Nick, let's talk about China, because the Chinese economy is clearly slowing. On the other hand in the second quarter, it still had 7 percent GDP, which we would die or, or kill for in this country, so why are the Chinese markets so jumpy?
NICHOLAS LARDY, PETERSON INST.: I think again, Chris, it's a correction. The Shanghai market was up more than 150 percent in the year to the peak a couple of months ago in June, so it was way, way overbought, way past fundamentals, and I think a correction was inevitable. It was very steep, in particular, since a lot of buyers, a lot of investors had borrowed money in order to buy equities. And when the prices started falling, many of them had to liquidate their holdings, so you had this very sharp decline, but I think basically it's a correction.
WALLACE: To give a sense of how extraordinary overbought the Chinese markets are, stocks in this country generally trade at about 16 p/e ratio, price to earnings, and in China on the markets before this fall, they were trading at 70 p/e.
LARDY: And in Shenzhen, they're still trading at 40, even after this massive correction. So by our standards, we would expect further price corrections in the weeks ahead.
WALLACE: Now, the Chinese government has routinely intervened in the markets to try to keep stock prices up, and they tried to do it again this week, but it didn't seem to work as well. Why not?
LARDY: Well, I think they were intervening a lot less. I think when the markets fell dramatically at the first part of the week, Monday through Wednesday, probably government intervention was off quite a bit, and that led to a very additional sharp decline. It was up a little bit on Thursday and Friday, and maybe that was helped by government buying, but quite frankly, we don't have much visibility on exactly what the government's doing on a day-to-day basis.
WALLACE: Is there some disenchantment from what you're able to tell among people in the Chinese stock market with the inability or the ineffectiveness of the Chinese government to intervene more effectively this last week or so?
LARDY: Yes, absolutely there's disenchantment, because remember, the government was talking the market up on the way, saying this is great, it's wonderful, it's going to continue. Then they intervened for a while when it went down, then they quit intervening and it went down further. So a lot of people trying to figure out exactly what's going on.
But keep in mind, less than 10 percent of Chinese households have any equity investments at all. So it's not everybody.
WALLACE: This is more though than just a -- a stock market problem in China, isn't it? We're also talking about a big economic transition in China, where they are trying to shift to an economy with a slower, more sustainable growth rate.
LARDY: Absolutely. It's a very challenging transition, they're trying to get away from the export-led growth that they relied on so much in the 2000, the investment-led growth they relied on so much in the past few years. They're trying to get more private consumption expenditure, but of course volatility in the stock market doesn't necessarily help that.
WALLACE: But let's talk about that. This is an economy that has been huge infrastructure-building, huge projects, creating -- priming the economy, and now they're talking more as you say about consumption, about the Chinese market buying more goods and services.
LARDY: Well, consumption has been growing very strongly. Its share of total output is actually rising slightly the last few years, and I think we will continue to see that. It's also reflected in the service sector that is now the driver of China's economic growth, rather than the manufacturing sector. Then that reflects massively increased expenditures on education, tourism, entertainment, and things like that. In other words, people are shifting their expenditure away from goods and more toward services, which is the pattern you expect to see as incomes continue to rise.
WALLACE: Liz Ann, the big question here in the U.S. now is what will the Federal Reserve do about raising interest rates? And I've got to say, Fed officials, whether they are in the various areas of the Fed or whether it's here in Washington, have been all over the map on that subject. One, are they talking too much? And two, what do you expect the Fed to do? Will they raise interest rates come mid-September?
SONDERS: Right, so Chris, the voting body is called the Federal Open Market Committee, and we have been jokingly calling it the federal open mouth committee, because there are so many disparate views being expressed right now. And I suppose it doesn't help in terms of the confidence on the part of the public, and I think that's one of the factors.
But what's interesting about this week, and it particularly relates to what the Fed may or may not do at their next meeting in September, is it may be lost because of all the headlines around market volatility, with the fact that we got some very good economic numbers. GDP for the second quarter was revised up comfortably above 3 percent. Every category from government spending to consumer spending to investment to housing was stronger. And then you had a lot of other reports that came in.
So as a result of that, expectations actually ticked back up that the Fed may actually move in September and initiate rate hikes, which by the way we think would be a positive sign about the economy and for investors as well.
WALLACE: Let me pick up on that as a final point, because obviously a lot of people are concerned the price of credit, the price of a home mortgage, the price of a car loan, all of that goes up if the interest rates go up. So why is that a good thing if the Fed raises interest rates?
SONDERS: First of all, we're only talking probably about a quarter of a percentage point, and that would just be on the short end. Many of those rates that you talk about are tied to the ten-year treasury, which wouldn't necessarily go up at the same pace. In addition, what I think is important from a confidence perspective, is that the Fed has had 0 percent interest rate since the end of 2008. That's an incredibly long period of time where they are still effectively treating the economic patient like it's in the trauma room. And I think a message of confidence in the economy would be positive psychologically, but I also think it may take some people off the fence that they might have been sitting on.
Okay, rates will start to go up. Now I need to move, I need to borrow to invest, to build. And I just wonder whether that's another way to think about this, given that we're only talking about a quarter point, but we're talking about the message it sends from the Fed about confidence in the recovery.
WALLACE: Liz Ann, Nick, thank you both, thanks for coming in today. We'll be watching and wondering when the markets open tomorrow. Thank you both.
LARDY: Thank you.
WALLACE: Coming up, the murder of two journalists on live TV. Our Sunday panel returns to discuss guns, race, and social media.
Plus, what would you like to ask the panel about this latest tragedy? Just go to Facebook or Twitter @FoxnewsSunday, and we may use your question on the air.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: We want to pause and reflect and we want to share with you once again what made these two so special, not just to us, but to all of our home towns that WDBJ 7 serves. Please join us now in a moment of silence.
(END VIDEO CLIP)
WALLACE: Colleagues of the two journalists gunned down on live television remember reporter Alison Parker, and cameraman Adam Ward. We're back now with the panel.
George, we had a perfect storm this week with the gunman, Vester Flanagan, shooting the reporter and cameraman on live television, then putting out his own video of the murder on Facebook and Twitter. What are your thoughts about the way this was carried out?
WILL: Well, when these horrific events occur, there's an irresistible itch to commit sociology, to find some explanation, causal link in some social prompting. This gentleman, this man was a gay African-American, who nevertheless was hired, in spite of what he took to be insuperable handicaps, and he does seem to have bought into the grievance culture of our times, feeling prickly and set upon at all times by all people.
That said, it seems to me we all should step before explaining these in terms of some defect in the society or some new social media culture. Because what that commits us to is the belief that every evil in the world can be changed by fiddling with the society, by rearranging it, by some law or regulation or something else. There are times when you just have to throw up your hands and say there's evil in the world, always has been, always will be.
WALLACE: Well, if there's one person who is going to try to find solutions, it's Andy Parker, who is the father of that young woman reporter, Alison Parker, and he said now that he is going to fight for tougher gun control. Here he is.
(BEGIN VIDEO CLIP)
ANDY PARKER, FATHER OF ALISON PARKER: We can effect meaningful changes in our gun laws here. This senseless act, this senseless murder will not go in vain.
(END VIDEO CLIP)
WALLACE: Christi, after the shooting, President Obama also deplored gun violence, but there was no talk in the White House at all about trying to push Congress for new laws. Have they basically given up on that fight?
PARSONS: I think they've given up on making it a marquee effort. As you recall, a couple of years ago, the president put his all, expended some political capital. The Democrats gave a really hard push toward coming up with some kind of --
WALLACE: This is after Newtown.
PARSONS: This is after the Newtown shootings. And as we all know, it failed, and the White House learned that lesson. So while you did hear the president this week express concern about gun violence and his staff was also saying there are still laws that would make other kinds of gun violence less likely, none of those laws seem perhaps like no law would have perhaps steered away from this particular event, but at the end of the week, the White House press secretary said, when the American people rise up and demand this kind of change, it will happen. Which was an indication that it's just not a thing on the White House agenda this fall.
WALLACE: We asked you for questions for the panel, and we got several like these. Tamara Hyland asked on Facebook, "what change in the current law would have prevented this recent incident from happening?" And Happy Kamper tweeted this, "how can background checks be more effective? Suspected unstable people with clean records are getting through."
Sheryl, I know you talked this week to Andy Parker, the father of Alison Parker, as well as Governor McAuliffe, the governor of Virginia. That's one of the things that's so troubling here. Vester Flanagan went to a federally registered gun store, bought the gun, went through a background check, passed the background check. So what could have prevented this?
STOLBERG: Well, you're absolutely correct. And it's not clear, frankly, as George said, that anything could have prevented this, but gun control advocates and people like Andy Parker would say that some things can be done.
First of all, 33,000 Americans die every year of gunshot wounds. That's accidents, suicides, and also homicides. A Harvard researcher has estimated that our firearm homicide rate in the U.S. is seven times that of Canada. So people like Andy Parker and Governor McAuliffe are saying, even if there are some small things that we can do to reduce that number, we should do them. So No. 1, universal background checks. There are still guns sold in this country, private sales, where there are no background checks conducted.
WALLACE: Gun shows.
STOLBERG: Guns shows, et cetera.
WALLACE: That is not, we should point out, what happened in the case of Vester Flanagan.
STOLBERG: Vester Flanagan bought his gun legally, passed a background check, it is true. Here's something else that advocates are talking about. In California, there is a new law called a gun violence restraining order. It's kind of like a domestic violence restraining order, where families of people who are mentally unstable or who fear that their loved ones may come into possession of guns and do harm with them, can go to a court and request a restraining order for 21 days. It can be extended up to a year. And advocates are starting to talk about, why not put something like this into place so at least if family members recognize or loved ones recognize that their -- people they know are unstable, they can try to do something to prevent it?
This grew out of a case in Isla Vista, California where a young man shot young women on a campus of University of California at Santa Barbara. Also, people are talking about smart guns. Smart -- we have smartphones that can be tracked, why not smart guns that can be tracked the same way if your iPhone is lost. So there are steps that could be taken, might not have prevented this particular instance, but advocates say they would reduce gun violence.
WALLACE: Michael, from a conservative perspective, what can be done?
NEEDHAM: The sad thing is there probably wasn't any legislative solution that could have prevented this tragedy. And it's a natural human impulse when a tragedy happens to look for an explanation. And in a society that is increasingly uncomfortable with the concept of evil, we don't have something that we could look at. So there wasn't a legislative solution that could have solved this. There are some things as George acknowledged, as George said, that are just evil, that don't have any other explanation, and the only thing you can do in those situations, is you can come together as a society, you can support each other, you can help each other try to heal. I think the most inspiring thing we've seen this summer was the way Charleston and the entire state of South Carolina came together and supported each other, healed and ultimately forgave. And that's ultimately all that you can do in the face of evil.
WALLACE: I want to, in the time we have left, almost make this a more philosophical and less a political conversation. Christi, I probably made a mistake, because I watched Vester Lee Flanagan's video, and if you watch it, and I suggest you don't watch it, you see that he has his gun out, and he's ready to shoot, but he notices the cameraman is panning away and looking at the lake that Alison Parker and the Chamber of Commerce woman were talking about, and it was only when they panned back and were on them that he shot at them. Clearly he wanted this to happen on live TV. He wanted people to be able to see it. And then he wanted to post the video that he had so carefully done on social media.
And I guess the question is, why? What?
PARSONS: Well, that's a really important question. And one of the debates that arose just in the hours after this on the Internet was whether you should watch the video. If that in fact is the kind of notoriety that killers crave, does watching it and sharing it drive the incidence of violence? There is also a counter-argument that if we are going to respond by trying to make public policy that addresses tragedies like this, shouldn't we know intimately what we are talking about? And there is an argument to be made that by watching and bearing witness, we can be more responsible participants in that conversation.
WALLACE: And I noticed that very quickly, not immediately, but very quickly, Twitter and Facebook took the videos down.
PARSONS: Right. And I don't know exactly how that happened. If that was something they did by instinct or by request, I'm not sure. But it certainly had an effect.
WALLACE: Thank you, panel. See you next Sunday.
Up next, our power player of the week. How a blogger gets strangers to open up to millions of people.
WALLACE: Whether you live in a big city or a small town, we all try to find ways to connect to the people around us. As we told you last November, one man has come up with an ingenious method to meet strangers, and he's attracted millions of followers. Here's our power player of the week.
BRANDON STANTON, "HUMANS OF NEW YORK": It's very hard to convince that taking pictures of people in the street and putting them on Facebook was going to be a winning formula. Because there's nothing but pictures of people on Facebook.
WALLACE: But Brandon Stanton turned that formula into a big winner. He started his blog called Humans of New York in 2010.
STANTON: I said, you know, in three years this thing's going to have 10,000 Facebook fans. And to me, that was success. 10,000 people were going to be looking at my work.
WALLACE: And now you have?
STANTON: Almost 11 million.
WALLACE: What those millions of people find are not just photos, but remarkably intimate stories like this fellow.
UNIDENTIFIED MALE: The vast majority of people just marry because they're ready. I never really felt like I met the one. I don't think my wife is the one.
WALLACE: Or this woman.
STANTON: She said, I'll tell you what my husband told me when he was dying. I said, Mo, how am I going to live without you? And he said, take the love you have for me and spread it around.
WALLACE: Stanton had just been taking photographs of his fellow New Yorkers, until he met this woman.
STANTON: She said, I used to be a different color every single day, but then one day I wore green, and that was a really good day. So I've been green for 15 years. And I put that little quote next to her photo on the website, and suddenly it was the most popular picture that I've ever posted.
WALLACE: Why is it that you think that the photograph, plus a little story, made the difference?
STANTON: So many of us are carrying around these things that we don't talk about. And to see another person talking about it in such an open way, I think, kind of helps people feel less alone, I guess.
WALLACE: Stanton let us tag along as he walked through a neighborhood, taking people's pictures and asking about their lives.
UNIDENTIFIED MALE: He would wave and he would stop the car--
WALLACE: He's photographed more than 10,000 people, and heard some fascinating stories.
And why do they open to up you?
STANTON: I think because I'm genuinely interested, and I'm a stranger.
WALLACE: And they're more willing to tell a stranger --
STANTON: Because I know nothing about them. The questions I tend to ask, happiest moment, saddest moment, what do you feel most guilty about? When did you feel angriest? When did you feel most afraid? The things that really kind of change the course of where we're going tend to revolve around a very strong emotion like that.
WALLACE: It's all about sharing our common humanity.
STANTON: The kick that I still get is when I walk away and I just think, I can't believe that person just felt comfortable enough to tell me that.
WALLACE: Humans of New York now has more than 14 million followers on Facebook. And that's it for today, have a great week. And we'll see you next "Fox News Sunday."
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