[Donald Trump was interviewed by Rebecca Ballhaus, Michael C. Bender, Alex Leary and Peter Nicholas of The Wall Street. The meeting was attended by Bill Shine and Sarah Sanders. The Journal stated the transcript was edited to remove off-the-record comments or "have been withheld for future Wall Street Journal articles." - http://tiny.cc/wsj-trump-20181022] We wanted to see if we could start with the news of the day. Erdogan in Turkey said today that Khashoggi's death was premeditated murder. Yeah, it's a rough statement. Yeah. Oh, but let me -- I'll get this -- do you guys want something to drink? Let's let them move that, yeah. I'm good. I have a glass up there. Based on what you now know, do you believe the Saudi leadership might have some responsibility here for what happened? Well, we have our people coming back as we speak. Gina's over there and numerous other people. They went to Turkey and they went to Saudi Arabia and they went someplace else. And I'll have a very good idea some time tomorrow evening. They're on the way back now. They're literally on the way back now. It's a very -- it's a very sad situation and, obviously, poorly handled from beginning to end. Certainly is something that never should have been thought of no matter what. It should never have been thought of no matter what the original thought was, and as you know they have many different -- there are many different stories as to the original thought. But no matter what, from the least sinister to the most sinister -- and the most sinister is really bad. And then certainly the coverup, if that's what it was, which it seems like it was, was very poorly handled. Should have never happened. Does this change your thinking about MBS and the Saudi leadership and the U.S. partnership that you've tried to forge with Saudi? Well, I'd rather see the final reports because the real question is, did he know or did he not know at the outset? Not after it took place, but before it took place. And as you know, they're making a very strong statement that they did not know at the high level -- at the highest level of Saudi Arabia, and I hope that's -- I hope that's going to be the case. You said that it has been poorly handled. It sounds like you think that there have been mistakes made no matter what those final facts are. Well, the biggest mistake was -- How should this have been handled? Which piece? Certainly the location was inappropriate, but doing it in the first place was the biggest mistake. Shouldn't have ever been done. Which -- what are you referring to -- And, you know, I know you guys find this hard to believe I'm saying, but the fact is that -- the fact that it was a reporter is terrible. It should have never been done. No, it shouldn't have even been in the thought process. But then once it was done it was obviously -- it was done horribly and it was -- it certainly seems to have been covered up horribly. Yeah. When you think -- what do you think about the way Turkey has handled the situation? They've been sort of dripping out their intelligence over a period of weeks. Yeah. Yeah. It seems intended to put some pressure on Saudi. It's different, certainly different the way they've handled it. I spoke with President Erdogan yesterday. Now that we have Pastor Brunson back -- he was just here, I don't know if you saw. Yeah, I saw. But now that we have Pastor Brunson back, I always had a very -- really great relationship with President Erdogan. Then we went a little bit south after that happened, and now we're back. And I had a very good conversation with him yesterday. But they are handling it tough. They're being tough. What about MBS? Which is -- which is fine. It's appropriate. Don't forget, it happened in their country. Yeah. Have you talked to MBS? And -- Yes. And what have you -- what's your message to him, and what has he said? Well, I mean, my message to him -- my first question to him was, did you know anything about it, in terms of the initial planning? And he said he did not. And I said, where did this all start? And he said it started at a lower level. So I asked him about it a couple of times in a couple of different ways, and he claims that he did not know that. And, you know, I can't -- I can't report or tell you any different story. That's what he says. I mean -- Do you believe him? And I also said I think he should issue his own report. You know, they're doing their own study and investigation, and I think they should issue their own report very quickly. Do you believe him? Do you believe the denials? I want to believe him. I really want to believe him. They've been a very good ally. They've been a tremendous investor in our military equipment and other things. They buy tremendous amounts of things from our country. It probably amounts to millions of jobs, you know, a million jobs. That's a lot of jobs. So I certainly want to believe him. If it comes out that he did have some role or some knowledge, do you think he needs to step down? So they're running their own country, and that's a determination for them to make. Certainly it would be a very bad thing in terms of relationship. It would take a while to rebuild. If you look at what they're doing, they've been a very good ally with respect to Iran and with respect to Israel. And it would be a -- it would be an -- it would be a very, very big change if we -- you know, we have a very, very strong and positive thing going on in the Middle East for the first time in many years. Iran is not the same country since I took away the -- you know, the -- you know, it's a different country. When I first came here, let's say the day before -- I'll say the day before I came in, Iran was looking good. They were going to take over everything: Syria, Yemen. They were going for -- they were going to take over -- who knows where it stopped. And since I've been here and specifically since I did the move that I wanted to do -- people asked me not and I gave them a little time, but ultimately they were wrong -- but since I've taken -- you know, I've terminated that deal, the Iran deal -- the Iran nuclear deal, to be specific -- since I terminated the deal, they're not the same country. I see it in many different ways. Their economy has crashed. Their currency has crashed. They're having riots every week, big ones, in every city. They're not the same country. They're bringing back soldiers from places that would be unthinkable six months ago or a year ago. Do you have any regrets about supporting MBS? You've worked -- Jared's worked closely with him. Yeah. Any regrets about that? Well, Jared never did business with him, by the way, you know. So just so you know. But you know, they’re two young people. They got along well. They didn’t see each other. It’s a long way away. But it’s not a question of regret. I’d be disappointed if this took place. Now, if you look at Iran, this is—you know, what they do is—take a look at all the people they’ve killed. I mean, they’re the number-one state sponsor of terror in the world. Would this be a -- is there any scenario, depending on what happens, what your -- what you investigation shows, that you would consider canceling that arms deal or -- So here's what I -- here's what I'm going to do. It's a fair question. The Kavanaugh hearing was very interesting, and I was given the power to oversee the FBI investigation. I was the one that was supposed to do it, by statute. And I decided that no matter what I did, if I said let's make it 10 years, the investigation, and let's use every single person in the FBI to do it, people would say, oh, he should do more than that. And what I did is I said I want the Senate to do and whatever they want me to do I will so order. And it went really very flawlessly. You know, and it was well-received because whatever they wanted -- if they wanted a week, I gave them a week. They wanted this or they wanted an extension, I would have given them an extension. And I'm going to do something very similar here. I'm going to give Congress -- and you have some very interested people in Congress on both sides. You have people that do not want to lose $450 billion worth of investment and you have others that think that we should. I disagree with them. But I'm going to let the people in Congress head it along with myself, as opposed to by myself. Because if I do by myself everybody, including the media, no matter what I do, will say, oh, gee, why couldn't you have done this or that. Another thing with Kavanaugh, though, is that you didn't want to put too much time on that. You know, you wanted -- That's true. I wanted it speedy. And I could do that. Congress doesn't come back for several weeks. I know. That's true, which is the only thing. You're right. They're out for a little while. But regardless, I just want to do it that way. I think I'm going to do it that way. So if Congress came along and said we want to cancel arms sales, you would go along with that? Well, I would -- I would tell them upfront that I think that would be a very foolish thing to do. And then if they came, I would certainly at least think about it. But I think -- I think if we do that, we're hurting ourselves much more than we're hurting Saudi Arabia. If we cancel $450 billion -- don't forget, you were on the trip, I think -- I went to Saudi Arabia. Oh, not that trip. I was on the Asia trip. It was unbelievable. But I went to Saudi Arabia first, not because of any reason other than I said if I'm going to go first -- they wanted me to go there so badly -- I would like you, as a sign of good faith, to order a large amount of equipment and other things from the United States that would create jobs, economic development. And we agreed to a number of $450 billion. There's never been anything like that. And I put them first on my list. And I really -- I like the king. I did speak to the king, too. I don't think the king was involved. I think it's -- I don't think -- I mean, the king is -- I don't feel that the king -- the king is involved. How much of the deal has been done? It's -- it gets done over a period of time. Do you know where you're at? No, but a lot of -- a lot of the contracts were handed out that day. And there were letters of intent and different things. But, Michael, it's a lot. Even if you took it and made it a lot less than that, it's the largest order ever made. Mr. President, you said you're sure you don't believe the king is involved. Are you less certain about the prince? Well, the prince is running things over there more so at this stage. The crown prince -- he's running things, and so if anybody were going to be in it would be him. Just my feeling. I spoke with the king. I don't believe -- you know, he denied it very, very strongly. I got to know him fairly well. And I don't think he knew about this. And the crown prince denied it equally vociferously, and I hope that he didn't know about it too. And is there any timeline -- I think there's a difference if he knows about it or doesn't. Now, he knew about it after it took place, but so did you, so did I. Is there any timeline, like with Kavanaugh, by which you want to have decided what the response will be? No, the only thing is that, you know, Congress is out now for a little while. Right. But we can get them a lot of information. We have a lot of information. We'll get them a lot of information, then we'll make a decision together. Congress would like to be involved in this one. But there's no point by which you want to have made a decision? No, I don't think so. Well, the press is going crazy over this. They're going crazy. Well, it's a whole -- it's a -- it's a potentially a very brutal story, depending on the way it all happened. Has your intelligence team reviewed any audio or video or sort of the things that have been talked about? I'd rather report to you in a day or two because they're all coming back now. Have they given you any preliminary reports on what they've seen and heard? They have a lot of information. I actually said don't give it to me on the phone. I don't want it on the phone. As good as these phones are supposed to be [Laughter] We do want to make a ton of news on this interview, Mr. President, so we'll move on in a second. But just one more on Saudi. You said during the campaign trail you thought Saudi was mostly responsible for 9/11. Do you still feel that way? On what? On the what? For the terrorist attacks on 9/11. Well, I said before I was president that was -- Do you still believe -- yeah, that was from the campaign trail. I mean, you had, what, 18 people and I think, 17 -- whatever it is. Only one didn't. Well, I -- that's right. And I was always critical of President Bush for attacking Iraq. I said, Iraq did not knock down the World Trade Center. They came out of Saudi Arabia. And they went to -- they went to Afghanistan. But out of the 15 -- Nineteen hijackers, 15 were Saudi nationals. It was 19 and 18. Oh, was it 15? OK. Whatever. It was a vast -- you know, so out of 19, 14 were Saudi. Fifteen, yeah. Fifteen were Saudi. So what responsibility does Saudi Arabia have for maintaining this relationship? And that's what's reported now, I assume. But I assume that's been the number we're hearing, 15 -- 15 out of the 19, yeah. Say it again? Then what -- just to wrap this up a little bit, what responsibility does Saudi Arabia have for maintaining this relationship? I mean, as long as it gives -- as long as it is willing to invest tens of billions of dollars, is that good enough? Oh, I think they have. I think they have -- Well, they have a very big relationship to maintaining the relationship. Don't forget, if it wasn't for us, it could very well be that Saudi Arabia wouldn't last very long. I've been saying that. I've asked in a very strong fashion -- before this happened -- I've asked Saudi Arabia to pay us a tremendous amount of money for defense. We're defending Saudi Arabia. They have -- they're a vastly wealthy country, and we're defending them, and we're not being reimbursed for our costs. A very small percentage is being reimbursed. And I've told them -- and other countries -- this is no secret. I've been saying this to a lot of people. But there are other countries that are very wealthy. You know, it’s one thing if we’re defending somebody, a country that’s really being horribly harmed and—that’s one thing—and doesn’t have economic strength. But, you know, we defend countries that are immensely wealthy, and then don’t ask for anything -- then don’t ask for anything. So that’s the story -- we can’t have that. Taxes. Your middle-class tax cut, can you say a little bit about where that came from? This is a resolution. Well, this -- I've been working on this with Kevin Brady for a long time. And because we're doing so well -- we couldn't have done this originally. I would have put it into the original bill. But we couldn't have done it originally because we -- you know, we've become -- I mean, we're doing really well. The numbers are really good. How are you going to define middle class? Well, we'll define it. We'll have to -- we'll have to define that. I mean, there is a definition, but we'll make sure the definition is right. Do you have any thoughts on where that should be? This would not be for business. Now, this would be in addition, because the middle class did very well with the original bill. I would have put this into the original bill, but at that time nobody thought we would do as well as we're doing -- you know, the 4.2 and it looks like we're going to have another good quarter coming up. Then why need it? Why do you need this one, then? Because I think it's a good thing for the middle class. And don't forget, that's money that gets distributed back into the economy. In a different way than a business would do it, but it's money distributed back into the economy. And we are going to do -- we're doing very well. Do you have any idea where that -- should the cutoff be for the middle class? No, I just -- we're going to a 10%. No, that'll be -- that'll be -- will be a great thing for the middle class. I think the middle class deserves it. The middle class has been forgotten for many, many years. I call it the forgotten men and women. They came out, and they like Trump. But the fact is the middle class has been forgotten for many years. And what we're going to do -- this would be a resolution, because they're out, but we're doing the resolution now. We can't do the resolution till they get back. They have to -- when they get back, we'll do the actual filings. And how is this going to be revenue neutral? You mentioned in the pool spray -- We have a way. We're going to -- we're going to announce it at that time, but we think we can make it revenue neutral based on certain -- Wall Street Journal readers would really like to know. In fact, if you call Kevin Hassett, let him tell you, because I was going over it. Kevin will give it to you. You know Kevin very well. Yeah. And this is money that comes back, because it's money that's going to be spent on buying cars -- hopefully cars made in the U.S.A., by the way -- but it's going to be spent on things that we make and sell in the United States. Right now, three weeks ahead of the election, where we're at; the economy, as you say, there's a lot of positive signs. What are the biggest risks right now for the -- The Fed. The Fed? To me, the Fed is the biggest risk because I think that -- I think interest rates are being raised too quickly. I think, to me, the biggest risk is the Fed, because my trade deals are great deals. And the tariffs -- you saw what I put out today on the tariffs, I guess, did you see I put out a little social media. We have a lot of money coming into this country, people don't realize. And ultimately, I'll use it to negotiate. And if they don't negotiate a free -- don't forget, they wouldn't even meet with President Obama, Europe and these other countries. They wouldn't even meet. You know, the European Union wouldn't even meet. They said, we are very happy with the deal. Well, I'm not happy with the deal. And if they don't do the right thing, I'll put tariffs on the cars. And if they do, there won't be any tariffs. And tariffs are a great negotiating -- now, tariffs essentially ended in 1913, and the country was rich. If you read some of McKinley's speeches, they were very interesting. He talked about we will not allow the outsider to come in and take our wealth from us without having to pay. I could never have done it without tariffs. Without tariffs I could have never made the deal. OK. No, because I said, look, fellows, I say that -- I say that all the time. I have nothing to hide. If I put tariffs on cars coming in from the European Union -- Mercedes Benzes, you know, the BMWs, all of them; millions of cars pouring in. If I put a 25% or a 20% tariff on those cars, the money would be staggering that we would take in. They wouldn’t meet with Obama, the European Union. Japan wouldn’t meet with Obama. And they wouldn’t meet with us either. After a few months I said, all right, that’s all right. So I called them up. I said, listen, we don’t have to meet with you anymore; we’re just going to put tariffs on your cars coming in. They were in my office the next day. A lot of people say that tariffs are really the biggest threat to the economy long term. We don't have any tariffs. But you're saying it's the Fed. It's so much nonsense, OK. This is your story. We don't even have tariffs. I'm using tariffs to negotiate. I mean, other than some tariffs on steel -- which is actually small, what do we have? I didn't put them on the USMCA. We have a trade deal. I didn't put them on in South Korea. We have a trade deal. That was the worst deal. That was a deal made by Hillary Clinton. It was a horrible deal. We made it into a sound deal. But I didn't put tariffs. Where do we have tariffs? We don't have tariffs anywhere. I read that today: We're worried about the tariffs. You know what happens? A business that's doing badly always likes to blame Trump and the tariffs because it's a good excuse for some incompetent guy that's making $25 million a year. Just to go back to the Fed for a second -- But think of it, Michael. We don't have tariffs. Where do we have tariffs? I'm talking tariffs. I'll use tariffs. I mean it. I've said I was going to put tariffs on European Union cars, right? They came to my office. We made the concept of a deal. We'll see what happens. But they agreed to a deal that they wouldn't even talk about. There's no tariffs. So -- sorry -- if you think the Fed is the biggest risk, though, are there circumstances where you would consider trying to remove the chair? I don't know. I'm just saying this. I'm very unhappy with the Fed, because Obama had zero interest rates and I have almost normalized -- and maybe normalized, depending on who you're talking to -- interest rates. You give me zero interest rates and you show me my numbers with zero interest rates. He had phony numbers because it was based on zero interest. Well, you know, he had -- he had zero interest. lus, Obama took something where there was a lot more provision -- you know, there was a lot more potential for gain because, you know, it was at the bottom of a cycle. But forget that. Obama had zero interest rates. A very great guy last week was saying, 'If you give -- if you take what Trump has done and you leave interest rates where they were when I took over, we'd have the greatest -- well, we already do; we already have -- but we'd have the greatest economy in history. And why not talk to Powell about those frustrations? Have people told you not to? Because in theory he's supposed to be independent. But I'm not happy with what he's doing at all. Do you regret hiring him? And it almost looks like he's happy raising interest rates. What do you mean? I just don't like what he's doing. And I will let -- I will let him know through you because I leave him be, independent. Yeah. How is he supposed to interpret these? Because you said it's supposed to be independent. It's supposed to be interpreted. He can interpret it anyway he wants. I'm just telling you I've done very well with instinct. My instinct is that he's raising it too much. When we make -- when we -- every time we do something great, he raises the interest rates. We do great. How the hell do you compete with that? And Obama -- remember, this is very important -- Obama had zero interest. He had -- Why do you think he's doing that? He was supposed to be a low-interest-rate guy. It's turned out that he's not. Knowing how he's behaved, would you have picked somebody else, in retrospect? Too early to say, but maybe. What level of action from him would it take for you to step up -- Well, there'll be a point when I would have to find out. Look, there are a lot of people that agree with me, just so we understand, you know. I read them all. I read everybody. There are a lot of people that agree with me. So I have a hot economy going. Every time we do something, he raises rates. Now, what does that do? That means we pay more on debt, right? That means we pay more on debt and we slow down the economy, both bad things. Now, when there's inflation, which there's not of any consequence, I'm all for it. I'd even do it more. I'd rather do it slower and heavier, at a later date, if we need it. But the point is that you give -- you give me the interest rates that President Obama was paying -- anybody can do that with zero interest. But we're paying almost a normalized rate. Some people think we're paying a normalized rate. How many increases has he had? Five already? Five? Five. Five increases. Do you think -- So we had a good quarter. One more question. We had a good quarter. We're making, boom, and we have an interest-rate hike. So I like him as a person. I am not -- I disagree with him as to the raising of the rates. What I'd rather do is keep the rates low and pay amortization. I know we're running short on time here. I had a few things -- Well, let me just say, because to me that's maybe the most important. I would like to see the rates be low and pay amortization, pay off debt. And when he keeps raising interest rates, you can't do that. I think you were about to express what level of action from him would it take for you -- No level of action right now. But all I'm saying is that I would like to pay -- I would like to have interest rates low and I'd like to pay off debt. But you can't pay off debt when he keeps raising the interest rates. I mean, we had a case where he raised the interest rates right before we have a bond offering. So you have a bond offering and you have somebody raising interest rates, so you end up paying more on the bonds. Now you tell me, does that -- does that make sense? To me it doesn't make sense. You understand what I'm saying, Michael, right? With that being said, I'm not happy, and that's my only expression. It's the only thing I can tell you. What I'd like to see is the interest rate be lower, and I'd like to form the rest of it in the form of amortization, and even more than the combination of interest rate plus amortization. I'd like to -- plus the gap. I'd like to pay amortization and start reducing debt. But how do you do that when he keeps raising interest rates on you? I'd like to let all of that interest that he's raising pay off debt, and we could do that. We'd pay off a lot of debt. Sir, your next meeting is here, so maybe you guys -- OK. -- have one last question. So with all the -- I'm not doing anything. I'm independent. But I'm allowed to say what I think. That's what I think. I think he's making a mistake. I want to pay amortization. You can't pay amortization when he's raising interest rates, OK? I wanted to ask you -- To the extent that they're raising them. I just wanted to ask you, before we have to go, about your former lawyer, Michael Cohen. He -- About who? About Michael Cohen, your former lawyer. He said that you ordered him to arrange these payments during the 2016 campaign. I've discussed that so much. Nobody cares about that. But do you feel betrayed by your former lawyer -- Well, he's not allowed. -- that he's now turning on you? I mean, he's a lawyer. He's got tremendous legal liability. He's a lawyer. It's unthinkable that a lawyer would tape a client, that a lawyer would make statements to -- he's got tremendous legal liability. He shouldn't do that. Yeah, I’m surprised that he did it, but one of those things. But that a lawyer would tape a client, that a lawyer would make statements to people, he’s not allowed to do that legally. And you're saying -- He's got -- he's got -- all I can say is he's got tremendous legal liability for doing that. And you're saying you never discussed any of these payments with him during the campaign -- I've made all the statements. -- that he did it. Why do I have to say it again? I'm just saying a lawyer can't do that. Now, he represented me on very small things. He was like a public-relations person. But he was also a lawyer. A lawyer can't do that. Can you imagine a lawyer taping a client? I've seen lawyers that are very tough, very smart. They've told me, they've said they've never heard of that before. They've never even heard of it. What was your reaction when you found out that he had decided -- I was surprised. -- to make this payment? I was surprised. Who knew? Anybody would be surprised. Now, of the tapes, there was one tape and that -- it was a meaningless tape. There were many other tapes, though. He taped many, many people. He was taping many people. Hey, I wasn't his only client. He was -- you know, he had clients. He had a lot of clients, I guess, over the years. The other thing is -- this wasn't me. This was having to do with the taxi industry or something. But he has -- and financing, but nothing to do with me. But for a lawyer to tape a client is unthinkable. I've dealt with -- I've spoken to lawyers that were tough people, that have seen it all. They'd never heard of that one. But remember this, that the one little tape, but he also taped many other people -- many, many people. Many, yeah. Were you angry? And those tapes, as I've heard, are unbelievably complimentary to me. I've heard that too. We've got to go. Were you angry when you found out that he had made -- OK. Well, wait a minute, that's a big point. But, you know, they're unbelievable. OK, so this is used in writing. Yeah. I don't want to hear it on the radio or anything. No. We'll do it again, Michael.