This is a partial transcript from "Your World with Neil Cavuto," July 23, 2004, that was edited for clarity.

NEIL CAVUTO, HOST: Are stocks getting hit hard of late because Republicans are about to get hit hard in the November election? To hear some traders tell it, and the reason why we’re under 10,000, is well, the four-digit Dow, people concerned that there will be a President  (search). That might seem extreme. Are people getting a little bit ahead of themselves?

Who better to ask than former speaker of the House, Newt Gingrich. He’s also a Fox contributor and author of another great book, "Grant Comes East." I think he’s written about 500 books, something like that. But he’s a busy guy.

Newt, what do you make of that argument, the market is getting a little concerned about a President Kerry?

NEWT GINGRICH, FMR. HOUSE SPEAKER, FOX CONTRIBUTOR: I think that traders have to say something so they sound clever to explain why people should listen to them. My guess...

CAVUTO: Well, by the way, Newt, here’s the deal, we talk to them and we are going to talk to a few more after this. So you are on a roll here, keep talking.


GINGRICH: But, I mean, my guess is there is some profit-taking in midsummer and that is all you are seeing. In terms of the general election results, if the Bush-Cheney campaign does its job right, and communicates things like the Democrats have been blocking welfare reform in the Senate for three years, that is an 87-5 issue, the American people believe in work requirements and welfare reform, if they communicate clearly that both Kerry and Edwards voted against protecting pregnant women from violent criminals, that is about an 84-9 issue, you have got a whole series of these things. This is me most liberal ticket since George McGovern and my guess is it is going to lose, but probably not lose by the same margin as McGovern but lose by a pretty decisive margin.

CAVUTO: But Newt, let me ask you about this. I know Wall Street and all these people say, oh, you’re taking sides here. Now I’m just saying Wall Street is largely a Republican bastion. It’s a lot of very wealthy guys who — there are many Democrats but it’s largely Republican. And here’s the concern that was raised to me at a dinner recently, that they think that a Senator Kerry coming in is going to remove some of their tax cuts, some of their investment credits, some of the things that they hold dear like dividend and captain gains relief. That is what most worries them. Do they have a right to fear that?

GINGRICH: Absolutely, I think anybody in America who has an investment and anybody in America who has relied on job creation in the world market has a good reason to be frightened of a Kerry-Edwards ticket. This is going to be a tax increase, ultimately high interest rate, inflationary administration. And it’s going to be a protectionist administration, an administration...

CAVUTO: Yes, but Newt, those were the same concerns raised about Bill Clinton, right? Now I know you can say that you and your colleagues came in, in ‘94, things changed, but we didn’t do too badly under Bill Clinton.

GINGRICH: In the first place, the Dow went up dramatically after we took over, if you look at the difference between the Dow after the first two years of Clinton and the Dow after six years of Republican Congress.

CAVUTO: Good point, very good point.

GINGRICH: It is remarkably different. And the second place, Bill Clinton ran as a new Democrat. He ran promising to reform welfare. He ran focusing on a whole series of issues. He said he wasn’t a liberal and he took on the left in his party. And he was for NAFTA. Look at the courage that Clinton showed in the middle of an election in ‘92, standing up for trade and the world market and then look at what Edwards has said about an isolationist approach to the economy that is not sustainable.

CAVUTO: That’s true.

GINGRICH: So I don’t think there is a comparison between Clinton trying to move to the center in ‘92 and the degree to which you have the most liberal member of the Senate and the fourth most liberal member and literally, the most liberal ticket since George McGovern. I think it is a very different threat to the economy.

CAVUTO: Speaking of Clinton, I finished his book. He praises you, Newt. He loves you, I thought it was like a "kumbaya" moment with you guys.


GINGRICH: We both respect each other I think in terms of ideas but we differ a lot about politics.

CAVUTO: Well, it’s more than respect, he sung your praises, Newt Gingrich, good having you again.

GINGRICH: Take care.

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