"They know they have to make a hard turn now on the economy," Stephanopoulos said on "GMA."
As Obama returns home and McCain mulls a manuever to wrestle back the spotlight, the candidates are moving towards the next big moment in the campaign: picking their running mates.
The Washington Post reported Friday that McCain is ready to announce his pick and that it would be made before the Aug. 8 start of the Olympics.
The short list reportedly includes former presidential rival and one-time Massachusetts Gov. Mitt Romney, who is also a native of Michigan, where his father served as a popular governor of the Wolverine State in the late 1960s.
Also at the top of McCain's list: Minnesota Gov. Tim Pawlenty, a young moderate governor of a Democratic-leaning state that McCain could aim to pick off in November, and former Pennslyvania Gov. Tom Ridge, who served as the first Secretary of Homeland Security but whose pro-abortion rights stance could rile conservatives.
Republican longshots include former New York City mayor Rudy Giuliani, the city's current mayor, Michael Bloomberg, and one-time Democratic vice presidential candidate Joe Lieberman.
Stephanopoulos said he believes Obama will announce his pick in mid-August with the leading contenders believed to be Delaware Sen. Joe Biden, Indiana Sen. Evan Bayh, Virginia Gov. Tim Kaine, and New York Sen. Hillary Clinton.
Stephanopoulos said of Clinton: "Eighteen million votes, it's hard to take her off the list. But all the indications are that she is not Barack Obama's top choice."