MARIA-02
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(BEGIN VIDEO CLIP)
SEN. TIM KAINE (D-VA), VICE PRESIDENTIAL NOMINEE: Donald Trump has kind of started to go wilder and wilder I think after, by all accounts, losing the first bias, he started to make wild claims, kind of scorched earth claims about the election being rigged.
NEWT GINGRICH (R), FORMER SPEAKER OF THE HOUSE: I think that without the unending one-sided assault of the news media, Trump would be beating Hillary by 15 points.
(END VIDEO CLIP)
MARIA BARTIROMO, FBN ANCHOR: We have the very latest in the race to the White House coming up.
The battle to retake Mosul -- Iraqi forces have started their campaign to reclaim the city from ISIS. The details coming up on the second largest city in Iraq under ISIS control.
Samsung's Galaxy Note 7 grounded -- the FAA now banning the device on all flights over the fears of fire.
And a warning sign from the restaurant sector -- what a recent string of bankruptcies in the industry says about the broader economy and how will that play out.
Investors around the world watching earnings this morning. Bank of America just reported its third quarter results moments ago. It was better than expected on both the revenue line and the earnings line. The bank helped by strong results from bond trading. The stock is higher on the news as you see there. The banks did well last week because of better-than- expected earnings as well.
Meanwhile the broader market looking lower this morning. Take a look at futures indicating a decline of about 30 points on the Dow Jones Industrial Average. The S&P and the Nasdaq also under selling pressure.
In Europe declines across the board as you will see here, down between three quarters of one percent and a third of a percent across the Eurozone.
Meanwhile mixed performances in Asia overnight. You had winners in Japan. The Nikkei average up a quarter of a percent as was the Kospi index in Korea but the Hang Seng down almost 1 percent as was Shanghai in China.
Plus a wild night in the NFL. The Houston Texans topped the Colts in overtime. It was a thriller. We have got the highlights and how some NFL teams are pushing back on the league's rules over Twitter.
All those stories coming up this morning.
And joining me to talk about it: Fox Business Network's Dagen McDowell, Recon Capital CIO Kevin Kelly, Democratic strategist and Trump supporter Harlan Hill. Great show so far -- you guys.
DAGEN MCDOWELL, FBN HOST: Fantastic. And I see our famous guests waiting in the wings.
BARTIROMO: Yes.
MCDOWELL: I won't run my mouth because --
BARTIROMO: We have guests coming up, joining the conversation later this morning: Fox News senior judicial analyst Judge Andrew Napolitano is here; and former FDIC chairman Sheila Bair is with us. I want to get her take on what went down at Wells Fargo and these sales processes in general.
But first, the race for the White House. Donald Trump is headed to Wisconsin today amid new claims of a mainstream media bias rigging him and the election against this campaign.
(BEGIN VIDEO CLIP)
GINGRICH: I think that without the unending one-sided assault of the news media, Trump would be beating Hillary by 15 points.
GOV. MIKE PENCE (R-IN), VICE PRESIDENTIAL NOMINEE: Frankly, you know, the timing of these unsubstantiated claims that have come forward all of which Donald Trump has categorically denied is I think deeply troubling to millions of Americans.
KAINE: I think after, by all accounts, losing the first two debates, he started to make wild claims, kind of scorched earth claims about the election being rigged.
(END VIDEO CLIP)
BARTIROMO: Joining us right now to talk more about the election is Ed Rollins. He's a Republican strategist, co-chairman of the Great America PAC backing Donald Trump. Ed -- good to see you. Thanks so much for joining us.
ED ROLLINS, REPUBLICAN STRATEGIST: Good morning. My pleasure.
BARTIROMO: I want to ask you about the media and whether or not Donald Trump is fight this uphill battle there. But I also want to get your take on these new polls this morning. First from the media -- Do you agree with his claims about being rigged?
ROLLINS: Well, rigged is a strange word to use. The media has always had a bias towards Democrats as long as I've been in the game which is a long period of time. So you sort of live by the sword, you die by the sword. I mean he had great advantages in the primary and obviously the media has turned on him with the exception of Fox and a few others.
That's why you have other alternatives of the campaign. You have your own ability to go out and communicate to paid media and what have you which he chose not to do as much as others have.
BARTIROMO: What do you guys think about this? Because I mean, you know, does it matter that ABC, CBS, NBC, "Washington Post", "New York Times" are all pushing Hillary and may not be covering this -- may not be covering Trump fairly given that there is a new world today. You've got online social media, Drudge, Breitbart -- what do you think?
HARLAN HILL, DEMOCRATIC STRATEGIST: I still think it matters but he needs to stop complaining about it. So what? Of course, the media is biased against Donald Trump. But it doesn't get him anywhere. I mean maybe it reinforces his supporters and their support of him but I really don't see what it gets him in terms of Independent voters and Democrats.
BARTIROMO: Ed -- what do think of this? I mean at the same time, the average guy and gal out there may not know. They may not really be aware.
ROLLINS: Well, I think less and less people read newspapers or follow things on mainstream television but at the same time there has been certainly been a drumbeat out there and there's certainly has been no love lost. I think the critical think here and obviously we're going to get into the polls.
We have to quit worrying about national polls. They don't mean a darn thing at this point in time.
BARTIROMO: Uh-oh. That was my next question -- Ed. Because --
ROLLINS: I'm answering it for you.
BARTIROMO: -- before you pooh-pooh the polls -- Ed.
ROLLINS: Yes.
BARTIROMO: Can I just ask you about this.
(CROSSTALK)
BARTIROMO: This is important. I mean -- really. NBC News and "Wall Street Journal" put out their new poll yesterday. It has Clinton ahead by 11 percent -- Ed Rollins -- that is a pretty big lead but it's a completely different story in another poll and it's taken during the exact same period. This is the new ABC News/Washington Post poll. It has the two candidates in a statistical dead heat. Clinton is up four points over Trump.
ROLLINS: In fairness, four points is the margin that Obama had over Romney last time and when you're dealing in the Fox poll, probably the most accurate poll which is --
BARTIROMO: And this is the most recent. This was right in the middle of the two. Here's the Fox News poll -- 45 to 38. Here it is. So what you think?
ROLLINS: I think that's the most accurate poll. And I think what you do - - I've always had my own biases on polls. I think they're very, very important for a person who's running a campaign. It's like instruments in an airplane. You've got to have them but at the same time your have to understand that they can -- there's lots of different ways of looking at it.
The problem with the NBC poll is that if you basically believe that Trump is only trailing women by 8 percent when every other Republican historically has done way more than that considering these last couple of months, I think you have to sort of throw that poll out.
My premise has always been, if the poll matches my gut I believe the polls. If the poll doesn't match my gut, I go do another poll. And we certainly have enough polls today. I think the race is a seven or eight-point race.
But I want to come back to national polls don't matter today. It's state- by-state poll. We run electoral college elections and clearly Trump is behind in the electoral college today and that's what's going to matter at the end of the day.
KEVIN KELLY, RECON CAPITAL: So what's his path at this point? I mean it looks like he's pulling out of Virginia. At least, that's what we heard over the weekend.
ROLLINS: His one path -- and that is Wednesday night he has to basically make people look at him in a different way and think he's presidential. He needed to go out and call Hillary a liar and do all the rest of it and beat her up, the probability is that he will freeze it where it is today.
We've had 56 elections in this country since the beginning in 1789. We've never missed an election. We've got presidents assassinated, we've had wars, we've had revolutionary wars -- it's very, very important to preserve the democracy that we have. It's a beacon to the rest of the world.
So by Rudy Giuliani and others talking about elections being rigged, I've been around American politics for half a century. They're very, very few cases where there's ever voter fraud and it's very small in certain cities. No presidential race has been lost by voter fraud.
BARTIROMO: Really.
ROLLINS: And if two people basically have that ability to have an objection with Richard Nixon in 1960 and Al Gore when he lost and they haven't. They step aside -- but you can go back in history. I teach a course on American presidents -- you can't go back ever and show me any the elections were someone said it was won by fraud.
MCDOWELL: And I raised this earlier -- Ed but by using the word rigged even if they say that they're talking about the media, Trump is still tweeting that he is talking about what's going on in the polls as well. Does that discourage people from even out and voting for him?
ROLLINS: I don't think so. I think if anything, what's going to happen in both cases and what the "Washington Post" poll may very well do is energize Democrat voters who if they thought they were going to win by a bigger margin weren't going to turn out. I'm not a conspiracy theorist but certainly any Democrats can take that poll and argue we have to get out, we have to work harder than you ever worked before because it's close.
KELLY: You'd mentioned on Wednesday at the debate he sort of needs to pivot but won't that disenfranchise his base if they don't see him --
ROLLINS: His base is not going away. All the bombardment that's taken place -- they are still there. They're solid and he's reinforced it, reinforced it and you see in all of these polls. There is no evolving away from him about his base.
Equally as important, she has a base and it's not going away either.
BARTIROMO: But they need new people -- right. I mean go through some of the states. Florida is obviously critical. I was to happy to see Frank Luntz in the building earlier and he said look Florida -- he's got to win Florida at this point.
ROLLINS: Well, if he doesn't win Florida, there's no gain. He has to win Florida and Ohio. He has to win everything that Romney won last time -- Florida and Ohio and a couple of others to be in the game. Pennsylvania started to slip away today, Virginia which you said earlier, North Carolina which had been ours last time. We should be a Republican state -- it's very, very critical and then some of the smaller states.
But if you don't win Florida, you're not in the game. So all out efforts have to be in Florida, a state we can win. All efforts have to be in Ohio which is still a state we can win.
HILL: do you really think Pennsylvania is off the table at this point. I mean when you go to Pennsylvania, it's like Alabama -- right. And they're rabid supporters of Trump. And if turnout isn't what we think it's going to be in Philly amongst African-American supporters maybe he still can pull it off.
ROLLINS: We don't know that. And I think at the end of the day what difference does it make if African-Americans turned out at 13 percent -- it's 11 percent of the population. They turned out 13 percent of the electorate in the last two elections for Obama. So they go back to 11 percent. There's still a very significant vote and they're not going to vote for Trump.
At the end of the day, Trump has to get his base out. To your point in Pennsylvania you can travel all around Pennsylvania, all the rural areas of Ohio, Pennsylvania, what have -- you see nothing but Trump signs. You think there was no other campaign.
BARTIROMO: Then there's the money end of it. Trump's drawing some pretty big name donors but he's still lagging behind Clinton in fundraising.
Peter Thiel, PayPal co-founder. He did a good job at the Republican National Convention for him. He is investing $1.25 million dollars in the Trumpet campaign. Clinton raised $154 million in September. Trump raised $100 million in September. Does this put him at a disadvantage heading into the final days and what is your thought about Peter Thiel giving him $1.25 million?
ROLLINS: Well, I'm very pleased that Peter put money in and others have put money in. There's other millionaires that have put money into the race.
MCDOWELL: $24 million from five big donors.
ROLLINS: But at the end of the day, she has at least a two to one advantage going into the close of this race. She has bought a lot of air time already and unfortunately he's going to be badly out-bought in the closing days. She will have advantages on organization. She'll have advantages on television. She'll have advantages on all the absentee ballot and what have you.
He still has a dynamic opportunity here to basically perk this race up and he has to do it Wednesday night. Otherwise you're not going to be in it.
BARTIROMO: I don't know. Everything you're saying -- I mean all of these advantages that she's had, it's so extraordinary to me that it's still 50- 50.
ROLLINS: Well, it's not quite 50-50 but they're not eating the dog food, that's the bottom line. They still view her as not honest. They still don't want her. A lot of people don't. That doesn't mean she can't win the presidency. And I think at this point in time, she certainly has to be favored to win the presidency unless he can basically convince the 60 or 70 million people who watch on Wednesday night that basically he can be president. And there's a different (inaudible) and there's a different vision for the country which is really what he has to make that effort.
BARTIROMO: Wow -- such a big event as far as where we are at this Wednesday night debate.
Ed -- thank you.
ROLLINS: My pleasure.
BARTIROMO: Amazing insights as always. Ed Rollins there.
And Fox Business Network will take you live for that third debate. It is critical in this election. It's moderated by Fox News' Chris Wallace. Our special primetime coverage will kick off at 6:00 p.m. on Wednesday night, right before the debate. And then MORNINGS WITH MARIA will be live for pre and post analysis from the debate. That's Wednesday and Thursday from Las Vegas. Join us alive.
Coming up next, a siege on one of the largest ISIS strongholds in Iraq -- the new push to drive the Islamic state out of Mosul, the second largest city in Iraq.
Then fall is here but it doesn't feel like it -- hear record heat hits half the nation. When the big cool-down will finally arrive?
We are back in a minute.
(COMMERCIAL BREAK)
BARTIROMO: Welcome back.
Iraq's military on the move this morning to retake the country's second largest city from ISIS. Cheryl Casone with the details now -- Cheryl.
CHERYL CASONE, FBN CORRESPONDENT: Yes -- Maria.
Convoys of Iraqi and Kurdish forces could be seen moving towards battle early Monday morning to drive the Islamic group out of Mosul. There are reports of scattered artillery shelling and plumes of smoke in the air right now. This offensive with U.S.-led coalition airstrikes are lending support to Iraqi forces and this will be the biggest military operation in Iraq since American troops left back in 2011 and if successful the strongest blow yet to ISIS in particular in northern Iraq.
Well, in business headlines this morning, some restaurant chains are getting too fat through expansion. The "Wall Street Journal" has reported that in one recent week alone, three restaurant companies filed for Chapter 11 protection. They include Cosi, Rita Restaurant (ph) and Garden Fresh. And the Journal says the shake-out was caused by an over-supply of eateries and new rivals offering prepared meals to go. Experts say expect more closures.
And staying on food, Tyson Food recalling more than 1,100 pounds of frozen popcorn chick products -- that is because they may be contaminated with extraneous materials, specifically hard plastic. The items were produced on August 10 and sold under the name Tyson's Fully-Cooked, Whole Grain Golden Crispy Popcorn Chicken, Chicken Patty Fritters. There has been no reports of injury or illnesses though associated with those affected products.
And the Transportation Department issuing an emergency order banning passengers from bringing Samsung Galaxy Note 7 smart phones on all airline flights. The agency says that the phone may not be carried on flights to and from the U.S. or within the country. Samsung recalled more than 2.5 million Note 7s after reports of the phones catching fire. The South Korean company also discontinued the product completely, Maria. Eight international airlines are banning the Note 7 now from checked and carry-on bags. You've got Air Asia, Singapore, Qantas, Emirates, Virgin Atlantic, Malaysia, (inaudible) and even Air New Zealand. So the Note 7 is not welcome on an aircraft near you.
BARTIROMO: Wow. That is a big story. That is such a negative for Samsung.
Kevin Kelly, what -- I mean what does this company do at this point?
KELLY: Yes. You're actually starting to see a bunch of value investors come in here because they do have such big operations. And Samsung even supplies parts to Apple. So the parts have infrastructure on the chip side. But it has been a great benefit for Apple. You've seen Apple run up -- into this because there is a huge refresh cycle.
So given what's happening with Samsung and their continuous blunders it goes into consumer confidence. I meant they've messed this up twice so it's going to have a knock-on effect especially for the next couple of years and consumers going into this because there are so many choices.
Don't get this wrong. The phone space is a commoditized business.
BARTIROMO: Sure.
KELLY: You can get the same features generally across the board.
BARTIROMO: Yes, prices come down.
MCDOWELL: I got my new phone.
BARTIROMO: You did.
MCDOWELL: My 7 -- and I'm extremely happy with it.
BARTIROMO: You have the Apple 7?
MCDOWELL: Yes. And I set it up yesterday.
BARTIROMO: What's best about it?
MCDOWELL: Much longer battery life and it's extremely fast. If you -- because I had to fix so I'd skip an upgrade cycle, I had the 6 with the new IOS on it. And it was just killing my battery and it was slow. This is -- you know, you got to dig into it. It's not, you know, this incredibly new phone but you've got the lightning port so there's no headphone jack. It's water resistant.
KELLY: Have you used the ear buds though?
MCDOWELL: I ran with the -- not the -- with the wireless.
KELLY: Yes, yes.
MCDOWELL: They're not out yet. The wireless -- they're called airpods, I think --
KELLY: Yes.
MCDOWELL: They're not out yet. They're out at the end of the month.
BARTIROMO: So you just use your regular headphones.
MCDOWELL: Eight miles -- baby.
BARTIROMO: Cool. All right. There's your recommendation for the new Apple phone.
MCDOWELL: Miss Bartiromo, rather -- not baby.
BARTIROMO: We'll take a short break.
Bank of America beat expectations in its third quarter earnings. We're breaking down those numbers tell you what it means for the sector and the markets.
And coming up, "The Accountant" adds up to box office magic. How much the new thriller Ben Affleck thriller brought in opening weekend.
Back in a minute.
(COMMERCIAL BREAK)
BARTIROMO: Welcome back.
Signs of strength in the banking sector once again this morning. Bank of America, the latest of the majors, reporting stronger than expected results on both revenue and earnings.
Joining us right now is Mainstay Capital Management CEO and Chief Investment Strategist David Kudla. David -- good to see you. Thanks for joining us.
DAVID KUDLA, MAINSTAY CAPITAL MANAGEMENT: Thank you.
We have (inaudible) bank numbers last week and we have more today on Bank of America. What's your take away on financials?
KUDLA: Well, we saw good -- some strong earnings on Friday when the banks reported, Bank of America today. A lot of it is about trading -- bond trading for Bank of America, trading has done well on the third quarter. Gut financials in general, we are looking for some good things to come from financials. We think that the Fed will raise rates in December -- that will help their net interest margin and for the big money center banks -- that's important also -- the regional banks.
KELLY: So getting back to that the financials can be broken up into different sectors within it -- right. So we like the exchanges, right, so we see they have got a great market share, they're growing, they're their consolidating. It's doing really well. And the big money center banks have this financial regulation overhang coming down on them -- over 22,000 pages of regulation out of Dodd-Frank.
So where else would you position? So would you more focus on the regional side like you had mentioned or would you go to the big money center banks that have been coming out and doing well?
KUDLA: Great question. So we like financials across the board and the big money center banks are going to do well. But we favor the regional banks and specifically the smaller regional banks.
No matter who we get for president here, we have Trump has said he's going to reduce regulations and Hillary Clinton has said she wants reduced regulations on the small banks. So with that we think the regional banks have an opportunity to perform. And especially when we get back to basic lending we look at what's happened with Deutsche Bank, Wells Fargo, big banks continue to have some reputational risk. The small banks are seen as the local hometown lenders and we think they will do better.
(CROSSTALK)
KUDLA: Yes.
KELLY: That's great.
BARTIROMO: What about the broader markets? Where is the broader market going -- you think?
KUDLA: Well, you know, we are in an environment here where we've been able to grind higher and we think we continue to do that. The concern is valuations are stretched. Certainly the market, by any measure is fully valued if not getting overvalued. Now, we know valuations are not enough to set the market back.
There has to be the catalyst, you know. We've got a couple of things coming up. We could have a geopolitical event -- anything like to prompt it and until then though we think that the recipe is in place for the market. They just kind of grind higher.
MCDOWELL: What about a rate hike? Would that be a catalyst? Or because people are anticipating that so much.
KUDLA: Right. It's probably not the one rate hike in December alone. It may be more if rate hikes accelerate significantly. You know, we've seen bonds and stocks move up together because of the Fed and they could move down together.
So our concern is either a misstep -- a policy misstep by the Fed or --
MCDOWELL: Janet Yellen doesn't appear to have a lead foot by any stretch of the imagination. I reckon that she's even kind of nodded her head and hinted that there could be a rate hikes. She gets frightened frankly.
KUDLA: Yes, they seem to be willing to err on the side of letting the economy overheat, if anything. Letting lower rates run for longer.
HILL: We've got 88 months of expansion and it seems to me -- what is a likelihood of having a recession in the next president's first term, in the next four years.
KUDLA: Very likely.
HILL: Very likely.
KUDLA: I think very likely only because of where we are in the economic expansion. By the time we get to the end of that term, if we're still in an economic expansion, it will be the longest in history.
And we are operating dangerously close to recessionary levels now. GDP over the last few quarters had only grown at about 1 percent. We've seen a job growth slowing, wage growth still anemic. So, you know, there are some concerns there. I don't see it on the horizon as imminent but if we look over four years and where we are in the economic cycle that's quite likely, based on historical precedent.
BARTIROMO: Is there anything you could point to that would break us out of that? I mean we talk all the time about tax reform, about the roll back of regs. What would it be that actually triggers some economic activity and unleashes business?
KUDLA: Well, I think, you know, when we look at this economic expansion that we been growing very slow so we talk about lower rates for longer when we're talking about the Fed and interest rates -- another thing we talk about is slower growth for longer.
We're just growing so slow that that in itself could expand this economic cycle further but, you know, we've never reached escape velocity for this economy. We've never seen those repeated 4 and 5 percent GDP quarters so I think were going to keep looking at these fits and starts and there's that risk it will be there and probably increasing.
BARTIROMO: That's why I think tax reform is so important because I feel like there is a potential to get business unleashed.
KELLY: Yes. The only way to do it is through fiscal policy. The efficacy of monetary policy has hit its wall. We've thrown in unprecedented amount monetary policy at the markets through bond-buying programs, the Fed policy --
BARTIROMO: Not much more you can squeeze out of that lemon.
KELLY: There's nothing you can do, the fed governors are saying it themselves. That's why there going to raise rates in December because they're saying we've done enough. The economy is where it's at right now. And if they don't do it, that's going to scare the market. And it could go down if they don't raise rates.
KUDLA: And when you look around the world, you look at the ECB at the last meeting. What did Mario Draghi do? He said I'm done for now, he said the country is with fiscal space, Germany. They need to do something on the fiscal side.
In Japan they're trying to find their way, right. And really that's what we need everywhere. We need a shift in policy for monetary to fiscal and that could be the catalyst.
BARTIROMO: And that's why I'm talking about tax reform.
HILL: But you're just putting notions. I mean if we were to dip into a recession how does the fed respond?
BARTIROMO: They can't raise interest rates in the face of recession.
KELLY: They will cut rates, they will buy more bonds. That's exactly what they will do because the government won't really do anything. Until the government does a fiscal policy, they will do that.