tv Cavuto Coast to Coast FOX Business January 15, 2016 12:00pm-2:01pm EST
be like rock them sock them robots. charles: that was mike huckabee on last night's debate. neil, you did an amazing job, buddy, take it away. neil: i don't know about that but thank you very much, charles. all right. we are in charleston, south carolina. and we like it so much, hell with it. the debate's over, we're just staying here and eating everything in sight, we're -- we're going through medicine cabinets, you name it. well, welcome, everybody, i am neil cavuto and now that the debate is done, one debate rages on. what the health care is going on? and who is at fatality for huge sell i just don't of? the dow down north of 400 points, back under 16,000, oil playing a big role here. but what's very interesting as we get deeper and deeper into correction terptory is where some of the money is going. interest rates are getting sharply lower. so if you do away to be able to buy a home, right now even
though oil is under 30 bucks a barrel, you've got a cheap mortgage rates -- lower than they were before the federal reserve. and for a while today, to which a lot of mortgages are paying, was trading well under 2%. let's get the read of things with dagen mcdow. guys, what do you think. >> i think at least when you have oil falling, gas prices will fall, longer term -- neil: yours has always been falling oil prices, falling gas prices, still a positive. >> huge positive for consumers. so you have lower interest -- longer term interest rates, longer gasoline prices, that at least gives what looks like a very shaky economy ballot. what's going on and what's worse, you look ahead. this market tells you something is very nasty down the road that personally we're going to have a much weaker economy. in a matter of months. that's what i'm seeing. you look at a stock like intel if we can pull that stock up,
that stock was down a double-digit perjury decline today at one point just because the market business which sells about based on cloud computing, sales aren't growing as fast as expected. that's a stock -- this is a market, look at the nasdaq. it looks very expensive. people are running for the exits here. and the question is why it looks like a weaker economy. neil: you know, it is in contrast to the one that was by the president this weekend in the state of the union address, it did come up in the debate last night where there are two different positions of this same world here. the republicans are arguing that way to ease the market's angst whatever they're thinking right now is to give them tax relief, regulatory relief. what do you think. >> well, first of all, president obama painted a glossy picture of the economy. on tuesday night and obviously since then, everything has gone south. and then republicans trash the economy last night. you don't have to look at one of the other -- just look at
what consumers are saying, look at what the polls are showing. americans are afraid right now, investors are afraid. i mean my goodness. let's put it very simply. when people are buying ten-year treasury bonds at 2% interest rate, that is a sign that people are incredibly risk ais it verse and they're saying, look, if you buy that at a 2%, you're not going to get any return. you're just saying i don't care if i make money, just keep my principle safe. so i think there's severe risk aversion right now and that's negative and for the first time in many years, i think we might have a negative quarter or two. neil: yeah, claw our way back. 1,500 points on the dow? first two weeks of the year? >> one of the numbers i'm watching for is 15,666 and change. that is the low. the dow low from august. you've already broken through that. charles: the last three numbers are 666? >> yes. i know. i know. >> there's got to be some significant. >> watch those. the nasdaq has already broken
through that august low today. neil: what acous? when they talk about pessimism breeds,. >> in terms of the danger to consumers, consumers, if their mood changes dramatically, they can actually bring a recession on. neil: right? >> so you watch these markets, you watch what's going on, i'll point to -- railroads are always a good indicator of how the economy is doing because they touch so many parts of the country and really the world in terms of moving cargo. csx said executive said on wednesday the current pressures on rail cargo volumes are at levels that we do not see outside of a recession. you keep hearing the recession word. already in the industrial economy, it's already in oil, but does it move outside of those sectors? >> the dollar continues to strengthen -- neil: now, why is that? because our markets. >> yeah. i think this is global fear out there right now. we see this all the time when there's global fear, where do people put their money?
they rush to the dollar. now, look. neil: they're not rushing to any stock market anywhere. >> i don't see it. neil: yeah. >> i worry this is the big apocalyptic pay back for all the central bank loose, cheap, easy money. because. neil: and then i'm hearing -- we're hearing this stuff from the fed. >> positive point about the -- >> no, you're not. we don't allow that here. >> which is this. investment does bring capital in the united states. so if you go to a lot of major cities, you go to miami or what's happening here in charleston or cities like nashville. building cranes all over the place. there's a lot of real estate development here and that's the fact of a strong dollar sucking capital from the rest of the world. so i just want to put a little bit of a silver lining. charles: you look at the half full glass. >> everything is just black and darkness. >> lady doom. >> i'm just kidding. no, i'm positive on the consumer. >> but you're also right about
that. i just want to second what dagen said about the low oil prices. in the medium and long term, there's no question about it. good for consumers, good for manufacturers, good for transportation industry. >> and ultimately because you don't want high oil prices -- neil: unless. unless it signals something deflationary going on. >> yeah. because what we've seen. neil: right now you agree with that. >> that this was the result of increased supply due to fracking now we're seeing reduced demand. and that's not reasonable. >> high oil prices was good for vladimir putin. and i'm not in bad with vladimir putin. i don't know about you. >> you know, we pay for gasoline here in charleston, by the way? neil: what's? >> $1.59 i saw. >> the statewide average is $1.70. neil: and you were notifying that in the backseat of your limo? [laughter] >> that's you, neil. neil: oh, that's right. thank you, both, very, very much. there are nervous cross currents here that they got into the debate and we'll get into that later on. but connell mcshane seeing proof of that today with
walmart and some rather tough news that's not being welcomed by workers. >> another sign, neil, you were talking about them with the economy in general. but thousands of layoffs with stores closing. walmart. 269 stores closing down, 154 of those in the u.s., you see the stock on the screen right now. and most of the locations impacted these walmart express stores that they've opened up. smaller stores that haven't been working out. but big impact on people and a huge name, walmart. 16,000 people worldwide. 10,000 in the u.s. as part of this. part of it is business strategy rather than macroeconomy, so i guess that's part -- you could point to that that they're focusing on other types of stores, those superstars. and focusing more on the internet. but still it's made necessary by everything you guys are talking about. the problems in the economy, problems in this retail market, problems for the company. the pressure's on to cut costs at walmart. see what the stock has done maybe over a longer period.
some analysts came out today and said even with all of this that this is not enough. that maybe they should try doing more. but retail is tough right now period. if you look at best buy cutting its forecast. macy's was a huge one to start off the year with the cuts and the bad forecast. it's not easy even if we look at our heat map, neil, which i know you like to do when we're talking about a stock market selloff day like today and that's a lot of heat. when i start, i was going to tell you home depot is up but even it's down now. so all 30 dow stocks are in the heat of the heat map. it's rough out there. neil: connell, how much -- the store closures here in the united states is walmart pegging on these higher wages? >> 154 stores in the u.s. are being impacted. but of those, about 100 -- just over 100 are the walmart express stores. so. neil: okay.
>> that's -- that didn't work out i guess the experiment with these smaller stores. so -- but # 60 some overall. but it's not good to point even if you break it down that way. neil: all right, connell, thank you very, very much. you know, the issue came up as well. would you be to injury slapping tariffs on countries if you don't deem them fair trade partners? that did come up in last night's debate with donald trump. and his original comment that he disvowed for 44% tariff on chinese goods, he later claimed that that was not the case but a tariff should not be out of the question because the chinese are running circles around us. republican from the fine state of south carolina. good to have you, sir. >> pleasure. neil: what did you make of what donald trump was saying that we have been playing defense? with china. and the best way to reassert ourselves is to consider tariffs.
>> it fits with the mood of the country. people are -- frightened and both in physical terms based on terrorism and frightened in economic terms. we can see that in the market and certainly see it in the politic. you hear tariff talked about more and more. it was interesting to see the reaction of the other candidates last night in the way that they basically said donald's onto something here. neil: they didn't like his solution. >> right. neil: american pay for those. >> right. neil: marco rubio gave the most robust i guess defense talking about the tie. but at the end of the day, they didn't completely disavow it. neil: what would you do? >> i think what you've got to do is the building blocks of competitiveness. that's tax policy, regulatory policy, that's your legal environment. it's a stability of your currency based in part of the stability of your spending. neil: but that's what donald trump was arguing is that tariff is one word but the way the chinese are playing is is
they are really a slapping a tariff on us by rejiggering their currency. >> i don't think the road is to debase your currency. neil: you see the argument he made? one of the arguments he made just the threat of it will get him to the table. like the ronald reagan star wars defense shield. >> or it could go the other way. leading the economist for moodies if you talk this route, you're talking depression and how this has evolved over the years went into the place in the '30s. the great depression ensued based on, you know, world trade going down by about two-thirds until the wake of those tariffs. congress basically said we don't have the capacity to handle this kind of thing. so we're going to hand off to the executive branch the ability to negotiate tariffs and trade deals. basically that's been the case. you know, ever since -- and we've had a bias toward more open and more free trade. not perfect trade. but more open and more free trade.
it served our country incredibly well and the danger what's being talked about right now in the political marketplace, is once you go that direction, it does not stop there. because the other country does something. i mean, you know, china holds $1.2 trillion of our national debt. maybe they do something on that something. maybe they do something in -- neil: trump saying we're always acting out of fear. when we hold the cards. >> yeah. but, again, i think that we ultimately hold the cards by being more competitive. i mean we can't have the highest corporate tax rate and compete with china and a whole lot of other countries around the world. you would argue i don't think tariffs are the right place to go. neil: good to see you. thank you very much. >> good to see you. neil: we have a lot more including how this market plays out. there are odd places the market is going. leaving the stock market. but some pockets of shall we say selling resistance. dow down about 413 points back under 16,000 in case you're
neil: all right. welcome back, everybody. you are looking at that -- sliding on a percentage basis. close to 2%. let's take a look at the other key energy component. you've heard probably a little bit more about and that is oil. under 30 bucks a barrel. and there's a brokerage firm out there that has an estimate even with today's 5% plus slide, it is going to get to 20 bucks a barrel. of course. of course there are a lot of factors of play here.
and let's pick them apart with the capital chairman overall energy guru. very good to have you. >> neil, glad to be here. listen, hats off to you and maria. you. neil: thank you very much. >> you were the best moderator that we've had. neil: well, thank you. that's very high praise coming from you. >> see, i've kind of trained you all too. neil: yes, you have. you have made us very smart about these type of issues. on energy, what is going on with oil? how low does it go? i know you see a bounce back but for the time being, what do you see? i think a brokerage firm is out there talking about $20 a barrel? what do you see? >> yeah. give you a to give you five seconds, i blew it last year, and i felt like the decline in the united states would be severe to the point that we would have recovered quicker than we did. okay. now, we're still -- you
know, we've got big inventories of oil. how much lower can it go? i don't know. it could go down in the 20s. but when it does hit bottom, you're going to know about it. it will turn. will it go straight up? no, not at all. but focus on really what this thing is doing for us. america. we've got the cheapest energy in the world. and we're going to get jobs off of that. there's no question. neil: but what about the in the oil industry? isn't it in the oil industry that there have been a lot of layoffs, something the saudis by overproducing. what do you think? >> well, 200,000 jobs we've lost and you saw yesterday what mckenzie said they cut 380 billion out of budgets. this year, which would be 68
major projects and that by 2020 is going to cost you 3 million barrels a day. those project killed, you can't start them up right quick. so what's going to happen to you by the time 2020, you're going to be back to $100 oil. neil: do you think the saudis are increasing production to stick it to us that they -- go ahead. >> this is what i thought -- what i think saudis. they said they weren't going to cut. you know, they said that a year ago or longer. neil: wait. >> they were not going to be a swing producer that the united states ran it up, we were producing 4 million barrels, we went up to 9.7, and we're the ones that oversupplied the market. so you're the guys to be the swing producer now. you don't have to cut instead of the saudis cutting. well, that's exactly what happened. i didn't believe they could go to the level they did. they went to 10.6. i think they're down to 10.2
now. we were at 9.7 and down to 9.2. so it's coming down. the market is oversupplied with about a million to million and a half barrels a day is what it is. if you go back to the '80s, we were oversupplied by 20 million barrels a day. neil: wow. i want to switch gears finally and it wasn't too long ago you created a little bit of a controversy talking about maybe we should have a screening committee or lack of a better term. a process or something we go to screen the candidates so i had to run for president. i don't know if i got them exactly right. explain what you were saying. because a lot of people said it sounded like prefrench revolution. how do you want to explain it? >> it sounded like what? neil: that you were being a elitest. >> no. i wasn't being an elitest, i think we should get better candidates.
you look at the democrat slate right now, you've got -- i mean clinton is probably -- i don't think she'll get the nomination. i think the fbi is going to take care of her. and if you look at obama, i mean the guy -- he never had a job. you say, well, he was senator for a minute. and he did community service work. and then you go over to the -- to the republicans, well, they by far superior to the democrats. but there's no real method for picking and vetting candidates. now, if you were going to fill a job with a major oil company, for instance, or ge. anybody. you would go to headhunters. you say, well, you can't do that. i agree it's an idea. but there should be some way -- and i can very well remember, you know, i'm 87 years old. so i was -- i've been around for everybody including tom
dewey -- go back -- did that make you laugh? go back to ronald reagan, and i can remember things that were said about him. he doesn't have the experience, he can't do it, he's a radio announcer, he's never had a real job, you know, managing anything. and he ended up the best. so get them into the -- neil: he would not have made a three-year screening process a guy like that; right? >> that he what? neil: he would not have made it through a boone picking screening process. >> well, i don't know. it's an idea. i think it's an idea to think about and figure out better ways to pick these candidates. neil: all right. what do you think -- >> let's talk about what's going on here. right now. last night. neil: donald trump. donald trump. what do you think. >> you've got trump -- yeah, you've got trump three or four months ago, he won't be around, he's not a serious candidate, yeah, he's a serious candidate. and people like him.
i mean the guy is, you know, he -- did he go wire to wire? he could. and he started out first. he stayed first. cruz has moved up. no question about that. he's an excellent debater. and rubio is hanging in there and the rest of the crowd seems to be struggling. and so -- neil: would you support any one of those guys? could you support any one of them? >> what? neil: could you support any one of them? >> i'll support whoever the nominee is. neil: okay. >> you know, i'm not going to influence the outcome and whose dominated. i've given up on that. but whoever we'll get, if it's trump, cruz, rubio, bush, any of them, christy, any of them. i'll support them. neil: all right, thank you very, very much. good talking to you. >> thanks. neil: as he and i were chatting, we have the dow now at session lows, closing on a 500 point hit.
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. neil: all right, we are looking at a major sell-off off the corner of wall and broad. had been in the triple digits all day, but accelerated within the last half hour. the s&p slid to a 15-month low, there are few places money can find a pocket to hide when. investors get nervous, they put it under the mattress or buy treasury notes and bonds. rates on those securities have gone below what they were prior to the fed's hike. so you find the 10-year note rates to which a lot of mortgages are pegged are pretty low. for a while under 2%. that will translate again into mortgages and the roughly 3.5%
neck of the woods. not exempt but a fairly reliable constant. we are hearing from josh earnest, i think, the treasury department is closely monitoring the market movements. no doubt watching fox business as they are. when they say they're closely monitoring things, hmmm? that's a sell-off all right. chris, good to see you in the flesh. >> good to see you. neil: what do you think is going on? the debate, talking about a stumbling start to the markets. you don't want to get ahead of yourself had a 2008 feel. >> i do. i think we've seen warnings from the major banks we're going to go into another depression. stock market is starting to sell off, people are starting to panic, and no one is sure what we can rely on in the next year.
neil: we have gotten into this before, this is a market propelled by accommodative fed. seemingly low interest rates, but it's been propped up on training wheels, too. they're taking the training wheels away and the markets don't like that? >> the economists are warning if the government is able to push back the hurt, they're not able to cure it. treating some of the symptoms and it's not going to get better, not going to cure the problems. the housing crisis, the fannie mae, the freddie mac stuff is not going away, it is building back up and the economy could be in a lot of trouble as soon as the feds take the hand off the wound. >> i was trying to get into the irony of that with the candidates last night, wouldn't it be something this president who came in as a result of an economic crisis, there are other facts, i'm not attribute to it solely, the next president comes in under the same conditions. >> not only the economic crisis
but wars in the middle east. when this president came in, he was hoping to bring up a change in the u.s. economy, leave better employment, less war, we're fighting in afghanistan, still taking casualties, may be going into iraq and syria. neil: who of the candidates impressed you or could impress you as someone who gets it on the national and i guess now economic security angle? >> i thought marco rubio impressed me. it was interesting to see in the republican debate it was about an hour and a half in before somebody defended the free markets. when marco rubio said hey, maybe a trade war isn't the way we protect american products, make it easier and more affordable for americans to manufacture their products. you heard jeb bush jumped on the band wagon and he pushed that. a lot of the other candidates had the little old-fashioned republican protectionism about them, kind of let on by trump. neil: what do you think trump was saying, forget about
whether he advocated 45% tariffs. he did. leave that alone. the threat alone might get someone to the table like ronald reagan with the strategic defense shield, remember that? >> i think trump's got a point. look at negotiating skills so far, almost every candidate from the undercard debate to the main stage was echoing some of the things he said. neil: you're right about that. >> whether it was ending the refugees, putting up tariffs, which hasn't been a republican decision for decades and decades, before ronald reagan. his ability to bring people to the table and ideas would ring true in china, which definitely respects strength. neil: and fear it at the same time. chris bedford, good to see you, my friend. >> good to see you. neil: the dow touching on 500 point hit, we hit it, down more than 3%. back in october, in 1987 that represented a quarter of the dow's overall value. it is a big deal, a big number.
today it's more like 3 hs. i'm not minimizing it, that was then. fears if this keeps going, it could be now, stick around. you're watching fox business. it's a fact. kind of like working from home equals not working. numbers look pretty good, how's it on your end dave? oh, the numbers look so good. dave, dave's on it.
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at ally bank no branches equals great rates. it's a fact. kind of like reunions equal blatant lying. the company is actually doing really well on, on social media. oh that's interesting. i - i started social media. oh! it was my...baby. . neil: all right, at session lose, down 514 points. down about 3.15%. from our highs, close to 14%, well into correction territory, right between what would be a
correction and a bear market, at 20% from our highs. that is a bear market signal. jeff flock on what is in large part contributing to this, and this is tumbling oil prices, right, jeff? >> reporter: oil, remaining below 30, neil, the outmonth, the february contract if you look at the intra-day today, you see the blood today. even the next month which is up on the board here now, they've moved to the march contract, that is approaching below $30 worth, $30.14 all around. bad all around. news from barclays energy analyst who within the last hour and a half tweeted crude oil may have priced in all global headwinds now but may post to reversal only in the medium term. he's saying we may have bottomed but we're not going to recover any time soon. one of the reasons is iran
today meeting in vienna of the atomic energy folks indicating that the sanctions are going to be lifted. when you look at what iran is sitting on, 10% of the world's oil reserves. 150 billion, billion barrels. they peak at 6 million barrels before the revolution, but it could be another 100 million barrels, you know, there's nothing good to support prices right now. neil: jeff flock, thank you very much. richard joins me, former wells fargo chairman and ceo, wells fargo, like the other financial issues under intense selling pressure. when i see something like that, very good to have you, happy new year. >> thank you. neil: i wonder about 2008, you can't help but draw the comparison, financial issues took a disproportionate hit and the selling beget more selling. do you worry about the historic anomalys? >> no. i think the conditions in 2008
are -- were unique, you had 20 financial institutions all gone now that originated securities that should never have been originated. you had agencies that misrated them. fannie and freddie buying this junk which nobody should have done, none of the conditions exist today. what you have today is i think simply what happens when central banks interfere with markets. bernanke and yellen said they wanted to encourage people to go into risk assets. that creates bubbles. when you have qe 1, qe2, qe3 and buying long-term bonds, you get into bubbles. the faster the bubbles break, the better. that's what's happening now, the bubbles are popping. it happened with high-yield bonds, happening in the stock market, and that's good.
neil: but you don't fear like a spillover? you don't fear a spillover effect that what starts there become fast market conditions, that's why it's selling, that it spreads like a contagion? >> no, as i said, i think it's influenced by inappropriate central bank interference with the markets for seven years, which they shouldn't be doing. neil: what is your sense about the bubble in bonds, more to the point in interest rates? i'm guessing the fed wants to change that by slowly hiking rates. a number of officials have over the last couple of days said there is nothing on the horizon to indicate a change of that stance, i'm paraphrasing here. what do you think about that? what do you think about whether that could mitigate the blow or complicate it? >> i think they should. i think the neutral equilibrium rate for fed funds is somewhere between 3 and 4%, we're a long ways away from that.
i think the fed should raise rates slowly, and should get to a fed funds rate of about 2% sometime in the middle of next year. the 2% rate is -- neil: that's a huge jump. that's a huge jump. i mean, to get to the equilibrium that you alluded to, when do you see us getting back to that? >> what happens is you get on 2%. if the economy is moving too hot, you're only 1% away from the equilibrium rate. if it's below the equilibrium rate it's accommodating. if the economy is too slow, have you room to reduce interest rates. so you need to get to a place where you with move in eeshg direction because we don't know what's going to happen a year and a half from now. so if you wait too long, you have to move really fast to get on 3-4%, that could put you in a recession. if you don't -- if the economy slows and you're at zero, what do you do then? no place to go.
neil: a very good point. >> as long as we have low unemployment. it's possible that employment possibly reduces from here, the rate of unemployment. as long as you have low unemployment, you should be increasing interest rates and you should -- what they should for sure do is stop buying long-term bonds so that we don't get bubbles and both the bond market and the stock market. they are still doing that, unfortunately. neil: yeah, easier said than done. we'll watch closely. richard, thank you, good seeing you again. >> good seeing you, neil. neil: let's take a look what's going on with the dow here. 530 points. that's a lot of points. back in 1987 more than a quarter of the dow's value. we lost that in one day. today, 3%. more after this. take a pill? or stop to find a bathroom? cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night.
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closely and is our chief money statistical overall brainiac guru yoda of all things finance has reminded us consistently, oil goes down, stocks go down, if you were to chart it, which we're not now. trust me charlie's done the charts, and no matter how far you go back, they are moving in tandem. oil ticks up, stock ticks up with it. right now with oil free falling, this slide is just continuing. so big, big concerns about that. where are we going right now, guys? i lost my sheet. all right. we have tom coburn joining us now. very big on watching out for government waste, and we still see it, and you know, no matter whether you are in washington or gone from washington it shows no abandon, senator, does it? it just keeps going. >> shows what you the problem is that once have you power
centralized in a central government, it abuses its power and whether you apply common sense or not, they're not going to listen to, it they continue to do the things that are not wise. it's different to have stupid things done when running a surplus, when you are borrowing against the future productivity and success of your kids, it doesn't make sense, it's about an uncontrolled federal government, not about the money they spend. neil: all right, well, you probably heard from a lot of the candidates last night, and they talk a good game, senator, about trying to rein in spending, we have to do a lot more than rein it in, you have to do it coupled with growth. tripping over themselves with tax cuts, is that alone going to do it? what do you think? >> i'm a physician -- by the way, i thought you did a great job last night. approach to our country is what are the problems and what are the solutions? and the solutions really -- for the last, since reagan, haven't
been very effective for our country that emanate from washington. so what really needs to happen is what our founders believed is the states need to start being able to exert more influence. ask yourself why we would continue to have 400 billion in dification waste and fraud of the federal government. that's 50 times oklahoma's total budget every year. neil: it's amazing, but we're doing these renewed shrimp on a treadmill-type studies and all. i know people say, you know, neil, quit whining about it, it's chump change. i remember you adroitly pointed out this adds up and they still do it. >> the way you get rid of a billion dollars worth of waste is a dollar at a time or $100 at a time. you can't have the excuse i did something stupid because i'm the federal government, our kids can't afford it anymore.
you see the lack of confidence, that's what happens when you have sell-offs and corrections. we have a lack of confidence in the federal government. and a lot of the debate last night was about that. i noticed ironically nobody mentioned unfunded liabilities that are 50% greater than our entire wealth. neil: amazing. >> we have more unfunded liabilities, 50% more than entire wealth. nobody talked about that. what we need is visionary leadership that says here are the problems. we're going to offer solutions to fix those problems and still try to protect those that are dependent on us. but there's no more favoritism in washington. we're going to devolve power to the states where it can be done effectively, maybe not perfectly, but much more efficiently than washington. and that's not happening. that's why i'm supporting convention of the states, because that's the only way we're truly going devolve power back to the states and spend our money much more wisely than what you are seeing happening in washington. neil: not a bad idea on any of the above. very thoughtful man. smart guy.
and you see the big picture. thank you, senator. >> see you. neil: 466 points, and to the senator's point, a lot of that may be an expression of exasperation what's going on. if you think about it, it is the equivalent of our market rome burning, and no one, no one is stepping up to the plate. stick around.
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are still up appreciablely from where they were when the president took office. having said, that you never want to be the party in control of the white house when stuff like this is going on. it depends how long it goes on, right? >> it does. when you look at the market crash in 2007, while both parties came together to find solutions, solutions like bailouts which i disagreed with, the republicans actually took the hit in the national election. so we have to see where we are in august, i think, of this year, to be able to get an assessment of the impact on the democrats' chances for the white house. neil: what is it, do you think, dennis, that happens in the eighth year of a two-term president that this kind of stuff happens? barack obama now or george bush with the meltdown. you could argue to a lesser extent for points of comparison, even bill clinton in his final year with the
internet boom, the bubble burst and then we had a recession. do you think it's just a cycle that runs out of time, recoveries get old and long in the tooth? this one is already the longest since post-world war ii. >> boom-bust cycles are engineered, they don't occur naturally. you look at 2007, the subprime meltdown and all of a sudden somebody said this thing is eroding underneath the surface. today we see oil prices falling precipitously, i saw your interview with t. boone pickens about the market, he knows as much as anybody. on the other hand, it's going cause interest rates to tighten, and when you look at a knock on effects of that with the fed's monetary policies, we could be headed for very
difficult times this coming summer. neil: do you think that knowing what we do now about the 2007 and 2008 experience, those say get ahead of the curve, do something, the government should intervene, support the markets, throw more cash on them to avoid what happened then and now. what do you think? >> the one thing is we shouldn't be encouraging companies taking on more debt, and there are some ways which the fed's policy does that. because what happened in 2007 is we had this amassing of debt and overleveraging and the creation of a ponzi scheme. today, we have to insist on more discipline with monetary policy, and the monetary policy of the fed right now encourages expansion of debt, that's not good for the country and the economy. neil: that is very well put,
you like the bed soft. he's more hardcore. so your sleep goes from good to great to wow! save $1100 on the i8 mattress with purchase of sleepiq technology and flexfit3 adjustable base. ends monday. know better sleep with sleep number. neil: down for 50. another off the week. ever. ever. jeff flock at the cme. what is going on. jeff. talking about oil today. down since we last talked to you. hitting another session low. as low as 2913. we are still above 30 for the next month. it will be another long right
here. >> everyone is starting to come to grips that we will flow rates for longer. we will blow oil presses for longer. oil will be around this level for a lot longer than people thought. >> he thinks that the headwinds are all priced in. he says we're not going to get a recovery anytime soon. do you think we bottomed? >> not necessarily. we could still trade to 25. what is $4. i mean, it is bad right now. it will be a little bit more bad than $25. it is not affecting that much. we will be around 30-$35. a lot longer than people thought. jeff: we are saving a lot of money. >> we are saving money.
look at retail sales numbers that came out today. though money is not getting back into the economy. jeff: i think i know where it went, though. powerball. that is where the dividend went. powerball. they spent billions on this. there you go. neil: thank you very much. connell mcshane detailing what is going on here. connell: it is a mess. no dow about it. the august lows did not hold. some people actually hovering around at the moment. being tossed around on wall street. investors throwing their hands up. we sell out big-time. work it out of our system. we will see how the rest of our day goes.
the start getting hit the hardest. a lot of consumer related names are moving lower. harley-davidson, marco cors, marriott. to that year, talking about this year, being the worst start to the year in the history of the dow jones industrial average. goldman sachs, intel and dupont. taking it average as a whole. these stocks, the s&p, the broad story. report and marathon oil, you have your commodity story in there. you know, it is one of those things where, as i said, we are watching levels of markets. we will see. it is only 1:00 o'clock in the afternoon. another 20 points or so on the s&p. maybe we hold for a little while. it will be interesting to see
how it wraps up. neil: you know, connell, un i love charlie brady. this is like wrist misstates. it is like, wow. blitzed by data left and right. connell: i will have to check. make sure he is fully dressed in everything. without him. neil: you are right. i do not know if investors are getting big hugs. they are getting big something or other. this that gripped the market, sometimes the market can take a panic of their own and build into rationally to no bounds.
i am wondering, because 2008 experience, whether it is feeling like that to you and whether it is beyond logic. what do you think? >> they always have their own behaviors and own psychology. they can also be crazy in the other direction. the more i think about what we have going on, the tale of two cities, the same thing. you both describe this for several years. they can make better decisions than individuals can in a capitalist market. instead of millions of us, hundreds of millions of us making decisions, all at the margins and keeping everything at a steady course, you have federal reserves coming in saying that we will make the allegation decisions. we will decide what outcomes will be.
we are smart enough to dictate that. as they do time and time again, oh, wait, it is not working. they go into this panic that you described and we have a day like today. neil: what do you think? >> it is kind of an interesting start. i agree with a lot of things that dave said he had governments cannot allocate correctly. they have held interest rates at zero. if anybody can prove to me that that is what has driven the stock market up, i am at a loss. they are lower than they were in 2010. if you really look underneath all of this, you have this great technology. we could list it all. it is driving earnings up.
the stock market is higher. i don't look at this as some type of realization. the sugar high is gone. i look at this as a market correction. we have had them before. down 1000 points a couple of years ago on one day. look. we are underneath. the economy is still growing. entrepreneurs are still growing. so far, this earnings report, 75%. things are better capitalize for today. things are nowhere near 2008. not even remotely close to something like oh eight. neil: i think i am an expert. give me my due respect. i think what the market wants is a bear market.
thirteen, 14%. why the base averages there. what do you think? >> i think they could be right. i think that kind of goes to brian statement. better question is, has the market been high on methamphetamine. far more damaging when you come off of it. it little oversight. that is one thing. kind of a systemic multi- year problem. it will come down and it will hurt a lot more. it will look more like what you just said, nail. more like a bear market. neil: a bear market for a while. is that a worrisome development
right there. >> well, i do not believe. i do not believe that the last six years has been a sugar high or a methamphetamine high. a lot of bonds. the banks never rented out. it is all sitting in excess reserves. the fed was driving the economy. $5000 gold. none of that ever happened. stronger today. coming down from the highs. we have low inflation. that money never made it into the economy. they have done a lot. everybody, you know, waits for every word that they say. in reality, the banks run the show.
the money supply that milton friedman told me to watch is only growing about 6% a year. it is not falling. it is not accelerating. growing at about 6%. the same kind of growth this next year. the markets are at date on emotion. it is not reality. i do not believe this has been a methamphetamine or a sugar high in the last six years. it has been driven by profit. it will continue doing that in the years ahead. neil: gentlemen, i want to thank you both very, very much. nothing to do with market averages. what if it was china or iran, north korea, isis, the unstable world. maybe that is why although markets in the world are feeling the same thing.
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see car insurance in a whole new light. liberty mutual insurance. or to obtain it is hard to believe that these are off even worse levels. north of 40 points or close to it. just north of the border. former media mogul. what do you think is going on? this is global. it is not just us, it is everybody. what do you think? >> talking about the stock markets and the financial markets now. is that what you are asking? >> bulleted coleaders have failed to exploit the fact that it is putting $7 billion a day
in the pockets of oil consumers. normally, when oil prices are going down, it is a political plus points. our politicians and although western countries are screaming. they are going down. doing the same thing. take the credit for the enhanced amount of supply and the enhanced amount of consumers and taxpayers. just adjust the tax system. reducing the tax on volume. increasing selective spending taxes. collective spending. they are not doing that. it is usual. i just do not think that our western bulleted coleaders are very good. i have not seen talent like this for a long time. it is not just oil.
it is terrible uncertainty in the middle east. completely disassembling them on their violent battlegrounds. some of the elements involved are terrible. objectively, nauseating organizations. you have a decline of at least that economic growth rate of china. real questions back in china. despite job growth. a lot of problems in the united states. doubling the national debt. you have quadrupled the money supply. you know, uncharted waters. neil: these unfunded liabilities are worldwide. over $100 trillion worldwide. i do not know where the heck you get the money to do that. the republican candidate man or woman say due back in this country is taxes.
refinance the military. what do you think of those types of businesses? >> it is how you do it. i think you cut income taxes to stimulate activity. you raise sales taxes and transaction taxes on elective spending. children close word food boxes in grocery stores. on luxury goods and things like that. it takes a lot of time, too. you can get that revenue back. it is not quite the same. it will not kill a man of your means. it is not the same as raising the price of red and milk in the food stores of america. no one is suggesting that. you will reduce the deficit. raising taxes on elective spending. you will stimulate the economy by reducing the income tax. this administration is making
mistakes. >> what do you make of donald trump? >> he is a friend of mine. i have great liking for him. he is a very generous, decent good man. a very successful man. some of his techniques running for president. he has the attention of americans. not any of the mistakes made by the entire political class. he has the charm of an archie bunker. he is very successful. it very wealthy man. he debunks political correctness. he is calling things by their rightful names. he has to be a little bit more careful. he should not be getting into
this idiocy like he did with obama. british subjects, for goodness sakes. john mccain burning the canal. this is rubbish. these are not real issues. you cannot keep all of them. starting to screen people. he is right about not tolerating. neil: you are right about that. i think -- i do not think that ted cruises shot at values was very great. >> i think he regrets having said that. >> i am sure. always good seeing you.
you start to hear the word carnage and purge. those are the ones you want to listen to at the moment. the market falls so much. the bottom pickers start to come back in. we are not seeing that just yet. we do have a bigger than expected volumes here. there is conviction here. i need to mention oil. i know you have been looking at it, too. the markets have been moving and tracking how oil moves. down 6% today. we know that iran, if it does get the agency go-ahead on january 15, pool, monday, a bit flexible foil. we know the iranians. >> i am not saying everyone is saying this in stride.
people would be going crazy. we are down about 500 points. we had so many triple digits. you drop 537 points. you did get people's attention. i think people are understanding more. i think that people are spending more. there are others that are looking at their 401(k)s highly diverse. neil: liz claman, thank you very, very much. one of the biggest and last night's presidential debate. concerned a certain candidate right to even be there. ted cruz.
may not even be an american citizen. take a look. >> some of the more extreme ones insist that you may not only be born on u.s. soil, but have two parents born under u.s. soil. by that theory, i would be disqualified, the agenda would be disqualified, marco rubio would be disqualified and interestingly enough, donald trump would be disqualified. on the issue of citizenship, i am not going to use your mother's birth against you. neil: all right. to the south carolina attorney general. who is right on this subject. in canada giving birth. i would think that would end the debate. i would think the child is an
american citizen. >> you guys did a great job last night moderating that debate. it was very entertaining. i have not spent much time thinking about that issue. i have been more focused on the constitution. more constitutional powers. i will be with ted cruises afternoon. i really allowed it to distract me. we pick our nominee for the presidency. neil: by nature, probably not inclined to get into the political weeds. i have a theory on this. it is meant to cast an element of doubt. think about voting for donald trump. maybe marco rubio.
less inclined to think about cruise. donald trump just said that there is a possibility that a democrat could file a suit. is that what this is about? >> you know, again, i am not advising mister trump. i think that that is what he was doing. this could be an issue if you win the nomination. i thought that at one point last night, wire you raising this now? he said because he is rising in the polls. >> i do not think any of us were prepared for it. he is brutally honest about how he views things. it was transparent why he was going after mr. crews at that time. i thought he acquitted himself very well in defense of that. i also thought that mister trump did an amazing job in defense of new york city.
i thought they both did a good job on the states last night. neil: attorney general, thank you very much for taking the time. all right. you know this said debate gets a lot of attention. the white house is watching. even prompting one white house insider saying it longs for the day of her man came. herman cain is here. next. ♪ ...why settle for this? enter sleep number, and the lowest prices of the season. sleepiq technology tells you how well you slept and what adjustments you can make. you like the bed soft. he's more hardcore. so your sleep goes from good to great to wow! save $1100 on the i8 mattress with purchase of sleepiq technology and flexfit3 adjustable base. ends monday. know better sleep with sleep number.
neil: all right. down 484 points. down 3%. there have been worse. oil big reason at 29 something a barrel. haven't seen that in a while. that is causing a great deal of concern but china might be ultimate catalyst for all of this unraveling. jo ling kent with more on that. hey, jo ling. reporter: hey, neil. we're watching intel right now. that stock is tanking precipitously down 9%. the reason it offered an out look that did not beat expectations and it's biggest pc market, where else, it is in china. that demand for pcs continues to drop. so there is a concern there for intel that they may not be able to fulfill an generate revenue and growth they need to sustain and beat the competition, satisfy analysts. you see weakness in intel.
you look overnight at shanghai composite down 3.6%. that is off, 20%, neil, from its highs in december. what we're continuing to see is volatility, lack of confidence in the market. there were two things you need to know about that happened in china overnight. first of all a report that some banks are no longer taking stocks as collateral for loans. that means liquidity, cash might be drying up there. the other thing that you need he to know about, about the chinese market just today, there is new official data out, neil, that deman for bank loans is actually weaker than expected. so you see all of these coming together, not good for the chinese market, at least for the global confidence that some investors had in china. not too long ago, neil. neil: jo ling kent, thank you very much. now i want you to take a look at this. >> the other thing that was notable about last night for me is, you know i never thought i would pine for the days of herman cain but at least he ad a nine nine nine plan.
it was outrageous but at least he had an affirmative governing proposal and agenda. next to all these guy on the stage next guy, herman cain looks like a policy wonk. neil: two things struck me there, the white house i long suspected watches me very closely. and the other is, that they're still obsessed about herman cain, who is one of the not only interesting and vetted candidates i think to ever run. he joins us now on the phone. herman cain, what do you think of that? it was clearly a slap at both the candidates now and at you then, from a guy who is in no position to slap, and your a friend, i don't like that. what do you think about? >> i think to be called a policy wonk by the democrats, josh earnest is a backhanded compliment. but the bigger compliment that he brought up nine nine. let me tell you where he is let
me tell you where he is dead wrong. the 9-9-9 plant wasn't outrageous. i heard very good plans. trump already published his tax replacement plan. carly fiorina talked about 73,000 pages to three. that is replacement tax plan and so did ted cruz. he is dead wrong he didn't hear anything similar to 9-9-9. that is where i start and a lot of republican candidates start in terms of turning this economy around. one other comment what he said. he said there is lot of overheated rhetoric, but not a lot of facts to substaniate it. bull feathers i would say on my radio show. i don't know if i can day that on your tv show. look at anemic gdp growth last seven years of barely 2%. obamacare has backfired on all cylinders but the democrats are in denial.
so there are plenty of facts to substaniate it but josh earnest just demonstrated he is also in denial. i feel like it's a compliment for him to opine me and my name! neil: you know what was really weird about it. i think you always argue stuff like that from a position of strength. thinking as markets are melting down, you have got the economy combustorring on itself, you have manufacturing weakening, service sector weakening, slow down in the mortgage-related arena he points finger, none of these guys have their act together. shut up! >> may i, may i say amane to that? they have -- amen to that? they have no reason to criticize plans and ideas republican candidates put on the table. it is clear from the last seven years that theirs haven't worked. raising tax hasn't worked. increasing regulations in an outlandish manner has not worked.
heavy-handedness of government has not worked. why we're looking 2% gdp growth on average when this economy is clearly capable of 4% or better. they're just in denial because they're living in a world like they were like to see it, rather than a world in terms of the way it is. neil: well, you and i discussed many times, it would be like me sort of pontificating about diet advice. josh earnest pontificating, talking about economic advice, i don't know. i don't know. but very glad you called in, herman. thank you very much. >> happy to do it, neil. as far as diet advice, what i did cut out carbohydrates and mashed potatoes that will work. neil: that is not happening. thank you. neil: i have been collecting comments from some of the reviews on last night's debate. again all of these represent people who watched the same debate.
cavuto and bartiromo interfere far too much. cavuto should just shut epand let the guests talk. going on a little built. cavuto seems obsessed with letting candidates state their case as if he doesn't even know how to correct them. cavuto goes on and on, always sounding like he is the most important person in the room. why doesn't he shut up and let candidates answer? cavuto thinks he's all that. he should have just left the stage. and then this is my favorite comment. who put him that broadway getup. [laughter] hon i, i know i've been away this week. but you packed that suit for me, remember? we'll have more after this.
reporter: fox business brief time. we're still in the new york city studios. we're off the lows of the session but volume today has been running higher than usual, about 40% above the average. earlier this hour i was mentioning the word capitulation where investors give up and sell, sell. we flush it all out of our system and then maybe stablize a little while. not clear we have got to that point yet. see the low for the day.
maybe a little more to go for a lot of people. we have a lot of consumer-related names hitting new lows. whirlpool, staples, bed bath. there is a lot more. as we head into the close we watch stocks. we'll keep an eye on oil. it traded below 30 bucks. 29.46 a barrel. that's where we are down 5 1/2%. fascinating move into the closing bell. back from the exchanges in a moment.
marco rubio thinks it's unfair to criticize him for missing votes. "but i am going to miss votes, i'm running for president." but he's been missing votes for a long time. "one third of all of his missed votes in 2015 were missed before he announced he was running for president." over the
last three years, marco rubio has missed more votes... than any other senator. washington politician marco rubio. doesn't show up for work, but wants a promotion? right to rise usa is responsible for the content of this message.
neil: reporting to you from charleston, south carolina. got to tell you no offense, we've been here we haven't had a chance to experience south carolina.
you like to break away in the middle after selloff. we were, my staff was, very illustrious staff, hotel accomodations i was like in gitmo. they had us in lockdown environment because they didn't want us to wander too far. they thought as a bone they threw to me, you're near denny's, neil, near wendy's. just telling we can leave the compound which is a little late because we're now leaving charleston later today. but i digress. everything comes back to me and what is it going on and that would be a little self-absorbed. one thing i noticed on debate in fox business, all the candidates and various ideas about turning this economy around, now to a man and woman they have been talking about cutting taxes you
know what is really bigger theme, it delights my next guest, getting handle on all rules and regulations which straddle companies with a lot of mindless, numbing paperwork, lawsuits, legal responsibilities and like. talking about former sec chairman harvey pitt who has been bemoaning this, gosh, as long as i've known him. harvey, they all see to say that almost matters as much, if not more than cutting taxes. why is it such a big deal? >> well, i think, first of all, we're living in a period of excessive regulation and unfortunately not very smart regulation. second taxation is very critical with respect to promoting the markets. we are really driving companies offshore and creating huge problems for those that have to
do business here. finally world policy issues have taken an overarching and over extensive impact on our markets. there is no confidence that the u.s. can handle these flare-ups and problems. that is shown by the market volatility we're seeing. neil: you know, a lot of companies point to rules and regulations sort of like a lot of retailers that have a bad quarter blame the weather and i'm wondering if it is just a convenient excuse. what do you think? >> well, to some extent i'm sure there are companies looking for any explanation they can find. in a sense it is convenient. but in a real sense this is a serious problem we have. it's crucial when we have rules that they play fairly but what we have prescriptive rules that
people can't even comprehend there will be violations left and right and business will suffer as a result because companies are basically afraid to move in any direction unless they tell them they can. neil: why can't we, i think you and i chatted about this before over the years, i think like if you buy a new tie, i do, i throw in an old tie, i'm wondering why we can't do the same with regulations. new one comes in might be perfectly justified. take an old one out. but we pile on and on and on? >> everyone complains, at least those who are guilty of overregulating that we need more rules, more rules. what we need are smarter rules. neil: right. >> we have to get rid of rules that no longer serve a purpose, that were written 20, 30, years ago and have no real relationship to today's markets
and which have to simplify the process. to me the best juxtaposition is the fact that the dodd-frank act took 2313 pages to tell the financial services industry what they have to do and when god created the universe, it only took two tablets and ten commandments to tell human beings how to behave. neil: i can't top that, harvey. that's very good. thank you very much, my friend. former sec chairman, for my money one. best we ever had, harvey pitt in washington. all right, socal greating what happened and what will continue to happen with these markets? worse start ever for markets. now they have had problematic starts in other years. in 1991 for example, but the markets came back. what about now? after this. wine wine equals pretending to know wine. pinot noir, which means peanut of the night.
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neil: all right, we're getting word from chip bowl tee, will shut down all their stores for food safety meeting as health officials con to investigate multiple outbreaks from a lot of incidents at the company. company-wide closure. only a few hours. we don't know what the hours will be but this could be a boon to hickory farms if you think about it, because in those few hours they could, you know do a rush to process meats and cheeses. too early to tell but we'll keep an eye on it. dagen mcdowell, connell mcshane, jo ling kent on this market selloff. dagen, you know we raised this in the debate, this issue about, what do you do if this is 2008 thing all over again? to a man and woman a lot of them said both dates, we'll cross that bridge.
we don't think it is. no need for the government to get involved. or anyone to get involved. what do you make of that? >> i think you have to be, with the candidates, neil, there is not much that they can say or do at this point. and you have to be careful about talking down a market. what did ronald reagan say? after the 1987 crash? markets two up, markets go down. that is it in essence. in terms of what president obama was talk about, went really overboard how fantastic the economy is. because this market, worse start to a year ever, is not telling you the economy is fantastic down the road. saying something all together different. doggone well looks like recession ahead based on market performance and wholesale selling that you've seen. neil: you know it is under very heavy volume, connell. our buddy charlie brady who crunches all these numbers say volume is running 40% stronger than normal. normally when you get that selling and punctuated by this kind of volume that is worrisome sign.
what do you think? >> we broke through these as i mentioned earlier in the show, we broke through the lows from august. once we did a lot of people were worried. then we stablized for a little while. we'll see if how we go into the close. follow up with 08 comparison and candidates and guests to be as dismissive some of them as that theory is kind of missing the point to some degree, it is not saying i don't think it will be a repeat of in terms of problems of 08, but financial sector system problems. there is a problem. say, for example, china and happening early in the year as it did, maybe a little earlier in the year than bear stearns happened in march of '08. we sold off and stablized into the markets and rallied into the summer. from a calendar perspective i think that comparison is valid. say we do stablize here as a lot of people think, we get to july and get to august. if the same problems we're talking about today exist then, if you're still asking, we're
talking about china, then you have the comparison of an '08 heading into the fall where they're not fixed going into markets, it could get ugly. that is what people are starting about and thinking about. neil: jo ling, we're talking about china and worries can't get out of its own way. this is market deep into bear market territory. what do they say about what to do next? >> well it seems like any analyst i talk to not at all bullish what the year will look like to connell's point. they don't necessarily see a route for turning around this market. first of all you have a very jittery, very rookie stock market which is indicator for a lot of global markets. even though it may, should not be one. so, you've got this stock market on one hand. you have a broader structural issue inside of china trying to move this economy, to grow faster, to be consumer-led of the those are two things simply not happening right now for variety of reasons. one being devaluation of the yuan. you saw we're having some of the
worst market days since august 24th. what happened on august 24th? the chinese government devalued the yuan pretty significantly. that doesn't seem to be holding although short term the chinese government held steady the valuation over past eight days or some we're looking at all the different pieces, plus the president xi jinping unsure how to handle market. he is not sophisticated and experienced in any sort of market reform even though he is trying to put something on the table. >> neil, i can relate our market, i can relate our market what is going on in china. we've had federal reserve and central banks around the globe tried to prevent or bring us back from this financial crisis in 2008. china, communist government, trying to control markets, trying to control selling maybe you can't. maybe you need to get out of the way. maybe the fed needs to get out of the way because it is going to be payback for the massive amount of record stimulus central banked pumped into the
system and only started removing it here in the united states. >> not our nature as a world anymore to get out of the way. to dagen's point. a lot of people are expecting someone to do something now whether -- >> hand out the pacifiers. everybody wants a bottle. >> whether it is, or saudi arabia say or us with the federal reserve. someone to do something. but you're right, that's a good point. >> regardless what happens in china right now, you do have, even if the stock market isn't necessarily going to be helped along or effectively helped along you have american companies in everyone's portfolios that i will be affected like apple. neil: jo ling, i'm still trending on facebook. >> you are indeed. neil: indeed. >> you don't trend on facebook, do you, neil? it is twitter you trend on. neil: whatever. >> both. neil: wow. in my asthma treatment. once-daily breo prevents asthma symptoms. breo is for adults with asthma not well controlled on a long-term asthma control medicine,
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not one nasty comment for trish regan or sandra smith. which makes me think it is trish regan and sandra smith writing aforementioned nasty comments. hello. trish: i happen to like that broadway outfit that you had on. i think it looked fantastic. neil: a certain friend of ours called it a guys and dolls tryout. leave it at that. trish: it was a terrific debate. neil: it was fun. we had a fun time. trish: lots of ground covered and fireworks. neil: your debate as well. trish: cruz and trump. i thought it was one of the best performances we ever seen. neil: people can look at the same thing and have different opinions. whatever. trish: indeed. great to work with you. neil: to you as well. get home safe. trish: we got a market, everybody, selling off big time. big selloff underway on wall street. dow down almost well, 430 points there. you can see that we are off the lows of the session but nonetheless a lot of red on your