MARIA-01
of States; Sanders Campaign He Has Raised Staggering $42 Million; NY Judge
Rules Apple Cannot be Forced to Turn Over Encrypted iPhone; NY Fed
President Bill Dudley Suggests Risks to U.S. Economy; Gas Prices Up for
Seventh Day in a Row; Apple Testifying on Capitol Hill Today - Part 1>
Casone, Phil Flynn, K.T. McFarland>
Energy; Business; Stock Markets; Apple; Security; Technology; Congress;
Privacy; Donald Trump; Bernie Sanders; Finance; Economy>
MARIA BARTIROMO, FBN HOST: The battle is on as presidential candidates fight for votes in 11 key states on this Super Tuesday. Blake Burman with all the details right now from Miami; Blake?
BLAKE BURMAN, FBN CORRESPONDENT: Hi there, Maria; good morning to you. So much on the line later today for the seven presidential candidates on the Republican side. There are 11 states in play tonight, roughly 25-percent or so of the delegate total. The poll suggests that Donald Trump could end up winning the overwhelming majority of states tonight. Ted Cruz is just trying to hold serve in his home state of Texas; 155 delegates in play there. The question for Marco Rubio becomes will he pick up his first state in the nominating contest. John Kasich is already looking ahead, past, to the upcoming weeks and Dr. Ben Carson say his campaign is still very much in play. This was the final pitch last night for Donald Trump to voters in Georgia.
(BEGIN VIDEO CLIP)
DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: We are going to win at every single level. We are going to win with help. We are going to win with education. We are going to win at the borders. We are going to win with our military. We are going to win, win, win, win.
(END VIDEO CLIP)
BURMAN: Bernie Sanders campaign has announced that he raised a staggering $42 million. On the Democratic side, also 11 states in play, roughly 20- percent or so of the delegate. The Sanders campaign is hoping that they can pick up a few states tonight, but this is looking very much so like this will be a big night for Hillary Clinton.
(BEGIN VIDEO CLIP)
HILLARY CLINTON (D), PRESIDENTIAL CANDIDATE: I need your help tomorrow. I need you to come out and vote tomorrow in the primary here in Virginia, on Super Tuesday, to bring everybody you can.
(END VIDEO CLIP)
BURMAN: Maria, you are probably wondering what we are doing here in Miami? Florida is not a Super Tuesday state. It has nothing to do with the fact that it's 75 degrees and there is a killer pool here at our hotel; maybe we'll get to that at some point. Hillary Clinton, Marco Rubio and Donald Trump are all here in South Florida. They are all looking ahead to the upcoming weeks; back to you.
BARTIROMO: Okay; that's why you're in Florida. Got it; thanks so much, Blake Burman. I want to bring in ProActive Communications President, Mark Serrano right now, on all of this. Mark, good to see you. Good morning.
MARK SERRANO, FOUNDER & PRESIDENT, PROACTIVE COMMUNICATIONS: Good morning, Maria.
BARTRIOMO: All right, expectations; what are you looking at?
SERRANO: I look at politics as I do a financial market. One single day performance can be interesting, but you really look at the trend line, and the trend line is overwhelmingly in favor of Hillary Clinton and Donald Trump. So I think what we will see tonight is Donald Trump will probably win eight of nine primaries. There are also two caucuses that are going on; those are less predictable. Texas I think should go to Ted Cruz. If Trump wins there, then that's going to tell a different story. So the trend line is overwhelmingly in his favor.
Super Tuesday in 1988 in 2000 and 2008 they were all similar positioned, where there was a frontrunner but some guys were still scrambling to try to slow him down. Typically, that doesn't have been peered.
BARTIROMO: Wow; so, Dagen, it comes down to is this going to be a sweep or not, for Donald Trump?
DAGEN MCDOWELL, FBN CORRESPONDENT: It's going to -- it could be a sweep. Even if it is in a sweep and Cruz wins Texas, it is still going to be a sweep to Donald Trump.
BARTIROMO: Right.
MCDOWELL: One thing to watch in Texas, Rubio needs to get to that 20- percent threshold in Texas in order to get delegates in that state. If he's going to st -- I know that he's committed to staying in it until the 15th, until Florida, but he really -- right now, the way the polls look, Rubio doesn't even look like he's going to win one state.
BARTIROMO: I know.
MCDOWELL: He's definitely got to get those delegates. My biggest concern, or the thing to watch is, do people who are not in favor of Donald Trump, do they not even go out and vote in some states? Virginia is purely proportional, so your vote really counts because there's no threshold. Are people going to stay at home because they're like, Donald Trump is running away with it; my vote doesn't count?
MORGAN ORTAGUS, CO-CHAIR, MAVERICK PAC: It's interesting you bring up Virginia because Virginia and Georgia are two of the places where Rubio is actually polling well. Does he have a chance at all, in your opinion, of picking off those states?
SERRANO: I don't think so. I think the gap is too large for him to overcome. Another interesting trend too is in Massachusetts, 20,000 Democrats in the last few months have switched their party identification so they can vote on the Republican side. That is an interesting trend.
What Donald Trump has done from the beginning is run a general election campaign. He's building a general election coalition already. Nobody ever does that.
BARTIROMO: Huh.
SERRANO: You don't do that in the primary. Hillary Clinton has been campaigning to the left month after month after month. Donald Trump has always just tried to build out in a broad coalition. So I don't think, in the case of Virginia, I don't think Rubio can overcome the gap.
ANTHONY SCARAMUCCI, MANAGING PARTNER, HEDGEYE: I started a new group called "Establishment Anonymous".
[Laughter]
SCARAMUCCI: We're having a group therapy session at 4:00 p.m. just to have a little s‚ance together.
BARTIROMO: Very good.
SCARAMUCCI: I'm a recovering establishment person but the question I have for you is you're in the establishment. You're getting phone calls from your buddies in Australia saying are you guys really going to elect Donald Trump? The answer could be yes. So what do you say to your fellow establishment people about his candidacy? Should it be behind him? Should they break and create a third party? What would you recommend to the members of the establishment?
SERRANO: Well my big concern is that the establishment right now is just looking to trip him up. You know, this #nevertrump movement that's going on right now and this notion that Mitt Romney, if Rubio drops out after Florida that Mitt Romney can get on the ballot in late states just to prevent Trump from hitting the 1237 delegate threshold. My recommendation instead would be to build bridges. It's kind of like with "The National Review" issue that came out a month ago. The reason why I think that was a huge mistake is because if this man becomes the nominee, or becomes the president, how are you going to be able to have influence? I mean, there is still the opportunity -- if the guy is a dealmaker, then there's the opportunity to have influence. So my recommendation would be build bridges, build ties. See if you can't influence who he picks for a running mate.
SCARAMUCCI: Do you think the establishment is too emotional in their outcry against him? What do you think?
MCDOWELL: Don't you think it's symmetric? I'm sorry, I didn't mean to jump in, but don't you think it's symmetrical because, I mean, their outrage is on par with his outrage and the outrageous things he said. So, I mean, every action has an equal and opposite reaction, right?
ORTAGUS: Listen, I've talked to people that were sitting senators, that were inside a meeting with Senator McConnell recently and Senator McConnell basically gave, according to the people who were in the meeting, basically gave those senators free reign to run ads against Trump in their state, if they wanted to, even if he's the nominee. I think while your address is great, I think the train has left the building. I that there is enough people in the conservative establishment and the regular establishment, and your establishment, are not going to settle for Trump being the nominee. I think that this is breaking apart of the Republican Party that we are about to see.
SERRANO: No, I actually think --
BARTIROMO: What does that mean the next couple weeks? You're either on the train or not.
SERRANO: Well, look, the guys are running, Rubio and Cruz. They've got a right to continue and try to give it the best they can --
ORTAGUS: And Cruz has a lot of money.
SERRANO: He's got a lot of money.
ORTAGUS: He's not going anywhere. Even if he loses today, which he's not, Crus is not going anywhere. He has more money than the RNC.
SERRANO: Absolutely; but the establishment is gnashing its teeth because of power. They want to be able to hold on to their power. They want to dictate the terms of races like this. They can't do that this year.
SCARAMUCCI: But can the Candidate Trump --
MCDOWELL: No, but some --
SCARAMUCCI: I'm sorry.
MCDOWELL: No, but some voters are gnashing their teeth because they don't like what Donald Trump represents, in terms of conservative ideals. They don't like he went after Bush and called him a liar, essentially, over weapons of mass destruction.
BARTIROMO: That's why Pete King is no longer -- he, for a little while, Congressman King was behind Trumpet and now he's completely done a 360.
MCDOWELL: Right. They don't like him over trade. They don't like him over spending plans.
SERRAN: Look at the economic and national security anxiety. Look at immigration. That's where this campaign started. Look, Jeff Sessions, who is the legendary on immigration, has now endorsed Trump --
ORTAGUS: Exactly.
BARTIROMO: And before --
SERRANO: -- a senior U.S. Senator.
BARTIROMO: And before him Stephen Miller, who's worked for Jeff Sessions was with Trump.
SCARAMUCCI: So he's got the nomination, Candidate Trump, and now he has to raise $500 million. Do you expect him to self-fund that or he's going to go out into the establishment to raise that money? How does that --
SERRANO: Well, the Republican Party has the responsibility to fund the Fall campaign. That's its traditional responsibility and they're going to have to --
SCARAMUCCI: It is, but the candidate typically leads the charge on that. You know, Spencer Swick and Candidate Romney --
BARTIROMO: He doesn't have any liquidity.
SCARAMUCCI: -- led that charge in 2012. So your self-funding your campaign up until the point at the nomination? What happens --
ORTAGUS: But, wait a minute. Doesn't it -- doesn't that go against everything that he stands for, if he takes the establishment money? I mean, this is the antiestablishment candidate. This is the kick the bums out candidate. If he starts taking money from donors instead of self- funding, then I think that completely delegitimize his is entire reason for campaigning in the first place.
SERRANO: But he's also running to be the nominee of the Republican Party. The Republican Party funds the Fall campaign.
BARTIROMO: Right.
ORTAGUS: But he's always said he's is not taking money from lobbyists.
BARTIROMO: True.
ORTAGUS: -- and he's not taking money from donors. He's thumbed his nose at them in every way. So, he can't take the money now.
BARTIROMO: It's a good issue to raise because I don't know that he has the liquidity to actually pay for this. What do you think Anthony?
SCARAMUCCI: Well, you know, it's not what I think; I mean, the answer is we are going to find out, Maria, one way or the other. My guess is that coming up with $500 million it would be tough for most billionaires.
BARTIROMO: Doesn't have it.
SERRANO: Let's keep in mind, look how far he's gotten on how little.
ORTAGUS: I was just thinking that.
SERRANO: My gosh, the earned media -- the media value, he's probably gotten a half billion dollars in media in the past year.
MCDOWELL: Does he need -- again, the most nontraditional campaign ever, how much money does he really need, even in the general election?
SCARAMUCCI: He needs $500 million because he's got to get out the vote in certain states, particularly in Iowa -- I'm sorry, Ohio and Florida. He's got to get the vote out. The best voter turnout operation in history was Barack Obama's. He was successful in 2008 and 2012. Governor Romney didn't have the apparatus, but even Candidate Trump will need that apparatus, in my opinion, to win the presidency.
Remember, the Republicans have to come up --
BARTIROMO: One of the reasons that you say it's going to be the Republican's and they will pay.
SERRANO: I agree, but I'm telling you those are those are the old -- I totally agree, but those are the old metrics. Those are the old standards. Convention goes out the window with this campaign and this candidate.
BARTIROMO: Really good stuff. Mark, thank you so much.
SCARAMUCCI: Establishment Anonymous, 4:00 p.m. We are meeting in the basement here at 1211 Avenue of the Americas.
BARTIROMO: Don't forget to turn in for our special Super Tuesday coverage today. It all kicks off at 6:00 pm Eastern on the Fox Business Network. I'll be joining the coverage, joining Neil Cavuto at 8:00 p.m. Eastern tonight. Hope you'll tune in to everybody tonight for Super Tuesday.
Turning to the other big top story, chalk one up for Apple. In connection with a drug investigation, a New York judge has ruled Apple cannot be forced to turn over an encrypted iPhone and the data in it to investigators. The decision expected to influence the closely watched case involving the San Bernardino shooters, that iPhone in California. U.S. Attorney General, Loretta Lynch, commented on the issue last night on "Special Report" with Brett Baer.
(BEGIN VIDEO CLIP)
LORETTA LYNCH, U.S. ATTORNEY GENERAL: Please comply with the law. That is not servitude of any kind. That is simply asking a company to live up to its civic obligations and cooperate with law enforcement, as directed by a court.
(END VIDEO CLIP)
BARTIROMO: Representatives from Apple will be headed to Capitol Hill to testify before the House Judiciary Committee on software encryption. We'll have more than that coming up in the program. Up next, fireworks erupting at a Trump campaign rally yesterday. We'll take you to some of the key states in today's Super Tuesday battle. Back in a minute; lots to cover. Stay with us.
(COMMERCIAL BREAK)
BARTIROMO: Incredible images last night as thousands gather to remember Virginia Police Officer Ashley Guindon. Cheryl Casone with that story now; Cheryl?
CHERYL CASONE, FBN CORRESPONDENT: This story really captured the nation. Good morning, Maria; good morning, everyone. (HEADLINES) And to the campaign trail, chaos at a Donald Trump rally in western Virginia.
(Video tape of Secret Service taking reporter to ground aired)
CASONE: So a Secret Service agent slamming a "Time" Magazine photographer to the ground by the neck moments after Black Lives Matter protest brought the event to a halt. The photographer not going to face charges. He was trying to get, Maria, a better shot of the protesters. All of this, of course, after David Duke, Grand Wizard, Klu Klux Klan, endorsing Donald Trump on Sunday and Trump not really repudiating that at the time. So it caused a big chaos yesterday.
BARTIROMO: Did you see the comment that he made when they were fighting and then taking the guy out? He said, are you from Mexico?
CASONE: He said that, too; he did. He made that comment as well. Then, the "Black Lives Matter" said black lives matter and Trump went back and said all lives matter. That also happened at that same rally.
ORTAGUS: The thing about this story is the cameraman was arguing the Secret Service, which I take the side of the Secret Service in this situation. At this point in time, the Government has assigned the Secret Service protection to Donald Trump because it looks like he's going to be the nominee. These guys but their lives on the line every day for the President, for the people running for office. You don't mess with the Secret Service.
MCDOWELL: If somebody has an earpiece, I generally don't mess with them.
BARTIROMO: Right. Exactly.
MCDOWELL: TV anchors and Secret Service.
[Laughter]
CASONE: Are we going to see more of this?
ORTAGUS: Absolutely, we're going to see more.
SCARAMUCCI: So let me ask you this, if you're a Democratic strategist, why wouldn't you flood Donald Trump's events with protesters. every single time so that the American people see a fight and a fracas, to try to disrupt general election favorability and popularity for him?
MCDOWELL: There's actually a playbook, I'm sure, that exists right now where that will happen at every Trump rally, particularly -- we're assuming he's the nominee, but it's going to happen over and over and over and over again.
ORTAGUS: The 2004 Bush campaign, they did this brilliantly. They're the ones who sort of pioneered this, when they went to all of John Kerry's rallies with flip-flops, and dressed up as flip-flops because they said he was flip-flopping on the Iraq War and other votes. They did that in 2004 and I think that has happened in every campaign since, so --
MCDOWELL: There is a level of rage though, on the right and left, that is scary. It's not just bubbling up, it is inflamed.
BARTIROMO: It's coming to a head; yes, that's for sure. Up next, the honeymoon might be over for your wallet, gasoline prices rising for a seventh day in a row. What that means for your money, next.
Then, Super Tuesday, the biggest test yet for presidential hopefuls as they make their final push for voters' stamps of approval. We will be right back.
(COMMERCIAL BREAK)
BARTIROMO: Welcome back; let's check markets this Super Tuesday. Futures pointing to a higher opening for stock prices. Anthony Scaramucci, broader market looking higher. We've got some developments on Barclay's this morning.
SCARAMUCCI: They're cutting their dividend in half and they're pulling out of South Africa, Maria. I think that's good news for Barclay's, long term. Jess Staley taking the reins there, redirecting the country. Coming out of South Africa will probably be 100-basis point improvement in their capital ratios. So it's long-term positive for the stock, but the trading has been halted. It's down about 11-percent, right now, pre-open.
BARTIROMO: Yes, but how pressured are these European banks right now? I mean, are they going to have to raise more capital? These stocks are looking at a worse performance, year to date, than the U.S. banks.
SCARAMUCCI: Yes, I think there's a combination of things, and "The Wall Street Journal" reported last week that our Federal Reserve was still helping them, Maria. This is a famous question that you asked those candidates in 2011, at Oakland University, would the Federal Reserve help European banks. Well the truth of the matter is since 2007 our Federal Reserve has been helping the European banks. So, yes, the European banks are going to under underperform because of the deflationary specter in Europe but in general Barclay's is going in the right direction.
BARTIROMO: Speaking of the Federal Reserve, I've got to get your take on this. Dagen, New York Fed President, Bill Dudley suggesting risks to the U.S. economy; that will put off any Federal Reserve interest rate increases. I mean, we were not necessarily expecting a big string of rate hikes but now you've got it from Bill Dudley.
MCDOWELL: Now we're back to the days the economy is bad and that is good for the stock market; maybe. Did you just see the rally of the futures? But, financials were the worst performing sector in the month of February, of the S&P sectors. So maybe, at this point, you get a little bit of moved up in financials --
BARTIROMO: Evaluation, just people looking for value?
MCDOWELL: Exactly, but this is not -- maybe that was already -- what I'm saying is, that was already factored into the financials that, basically, there -- it's going to be difficult for them to make money in this environment.
ORTAGUS: It just seems like it's been difficult for the Fed to have any cohesive decision for the last year. I think most analysts sort of expect them to raise rates earlier and then, back to Barclay's, I think this speaks to a larger trend of what HSBC, JPMorgan, Citi, all the big banks have been de-risking out of the emerging markets, which is something that I follow quite closely because I'm worried about what happens in the emerging markets when all of these big banks leave.
SCARAMUCCI: Listen, I think it is a longer-term issue. I mean, frankly, there's bigger fish to fry right now in Europe, in Japan, in China. You've got the devaluation coming. You have deflationary fears. These are the modern, more merged economies. So we've got to get that right before we worry about the emerging markets. But I do agree with you, emerging markets have also been shattered over the last six months and at some point they will present a buying opportunity.
BARTIROMO: Well we saw a buying opportunity in China, that's for sure. We had some data out which basically showed slowdown, although there is a feeling among some that we've seen the worst in China. I don't know how you feel about that, but the big rally overnight has some people believing --
SCARAMUCCI: See, my opinion, and I actually said this at a Morgan Stanley event yesterday, China is growing slower on a percentage basis but if you look at the real numbers, Maria, you can't grow 10-percent forever.
BARTIROMO: Right.
SCARAMUCCI: Let's say you're at $1 trillion. Well growing 10-percent is $100 billion. So the larger number is, the growth is still there in China on an absolute basis. It's just the perception now has changed.
BARTIROMO: All right.
ORTAGUS: From a consumer perspective, population is only getting bigger. I mean, the car companies, Apple, everyone is still making big plays in China.
BARTIROMO: All right; well take a short break. Up next, 2008 Republican Presidential Nominee, John McCain, lamenting the tactics being used by his colleagues on the 2016 campaign trail. His former campaign manager, Rick Davis, will explain all next. Then, Apple with a win. A New York judge siding with Silicon Valley company on one case. What that means for Apple's encryption fight and the testimony happening today in Washington; still with us.
(COMMERCIAL BREAK)
BARTIROMO: Good morning; welcome back. It is Super Tuesday, March 1st. It's going to be a tough fight until the last votes are counted in 11 states across the country today. Let's take a look what's at stake. On the Republican side, nearly 600 delegates. The key state to watch today, Texas. The Lone Star State has the most delegates up for grabs. It will be a key test for Ted Cruz moving forward. On Democratic side of the race, Hillary Clinton looking to extend her lead over Bernie Sanders, the two battling it out over 865 delegates in today's races. We will bring you the very latest from the campaign trail coming up.
Apple, meanwhile, scoring a major victory in the debate between privacy and national security. A New York court ruled that the Justice Department cannot force the technology giant to unlock that iPhone in a Brooklyn drug case. This coming as the FBI and Apple gear up for a hearing this morning on Capitol Hill.
On to markets we go. Asian markets, mostly higher this session over night, despite weak economic data out of China. Look at this latest read. It was the manufacturing index showing contraction for seven straight months. Early trade in Europe has gains across the board as well. The Eurozone PMI, that's the purchasing managers index, at a one year low. The numbers still coming in above the expectations and as a result, that helped markets there. We've got gains in between 2/3 of a percent and 1.5 percent higher in Germany.
On to the U.S. Futures indicating a higher opening for the broader averages here as well. Pretty strong, actually. The Dow Jones Industrial Average expected to open up 130 points, the NASDAQ expected to open up better than 40 points, that's one percent. Futures jumping after the New York president of the Fed, the New York Fed president, Bill Dudley, said that he sees downside risk to the U.S. economy that potentially prevents the Federal Reserve from raising interest rates any further from here.
Back to politics; candidates are gearing up for today's political showdown. Fox News' Rich Edson is standing by in Virginia, one of the most important states set to vote today. Rich, what are you hearing? Good morning to you.
RICH EDSON, FOX NEWS CORRESPONDENT: Good morning, Maria. It has already been a busy day of voting here. Polls have been opened for about a half hour here in the suburb of Washington D.C. of Alexandria, Virginia. It's a very Democratic part of the state and a number of the campaigns have been playing here over the last couple of days, in particularly, the Democrats have 95 delegates at stake here. For the Republicans, it's 49 Democrats [sic] and front runners in both campaigns, in both Democratic and Republican politics, have been campaigning throughout the state.
(BEGIN VIDEO CLIP)
DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: We're going to win tremendously. Virginia is going to have a big victory. I guess almost every place. Texas is the only one we are sort of tied, maybe losing.
HILLARY CLINTON (D), PRESIDENTIAL CANDIDATE: I really regret the language that is being used by Republicans. Scapegoating people, finger pointing, blaming -- that is not all we should behave toward one another.
(END VIDEO CLIP)
EDSON: All registered voters in the commonwealth of Virginia can vote today, they just have to choose whether to participate in a Democratic or Republican primary. The polls opened at 6:00 in the morning and will stay open until 7:00 tonight. Maria --
BARTIROMO: All right Rich, thanks so much. Rich Edson live there.
Arizona senator, John McCain, meanwhile, telling Fox News' Bill O'Reilly last night, he expects a majority of the Republican establishment to back Donald Trump if he wins the party's presidential nomination. But McCain also slammed the schoolyard insults between Trump and Marco Rubio amid national security threats in the United States.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), ARIZONA: We're talking about the size of people's ears and throwing water around the stage and talking about the size of people's hands. That's not -- the American people deserve a lot better and I am saddened that we are not discussing these issues when we are facing the greatest threats to security the United States in 70 years.
(END VIDEO CLIP)
BARTIROMO: Joining us is former Senator John McCain's national campaign manager and the current partner and chief operating officer at Pegasus Capital Advisors, Rick Davis with us on set. Rick, good to see you. Thank you so much for joining us. How is this possible that here we are on Super Tuesday and we're still talking about things like people's hands and the name calling and the mudslinging and not about the fact that we've got debt and deficits, national security, economic issues?
