Skip to main content

tv   Varney Company  FOX Business  December 6, 2018 9:00am-12:00pm EST

9:00 am
the nfib numbers. >> you look closely at the important numbers. >> i think it is a good barometer we talked about feelings and concerns and this is hard hadder ta-ta. >> god speed to bush families they lay their father and grandfather in our president to rest. >> absolutely. condolences from us that will do it for us. "varney & company" begins right now. stuart take it away. >> good morning everyone did america ratchet up trade fight with china at the request of u.s. authorities, canada arrested meng wanhou and she's daughter of huawei founder legendary figure in chinese business. the allegation is that huawei broke sanctions on iraq and arrested on december the first that is important because it is the date of president trump's dinner with china's leader xi
9:01 am
jinping. was america sending a hardline message? it has clearly had a big impact on your money. instead of a reare bound from tuesday's selloff we have with another selloff. we're looking at a triple digit decline for dow down about 400 and nasdaq down about 130. here is another problem for stocks. big drop in the price of oil. we're now 51 a barrel opec agreed to production cuts but we don't know how much. we understand that saudi arabia wants a small per cut than expected. little background here. president trump supports crown prince muhammad despite his widest expect involvement in jamal khashoggi are the saudis doing this to trump's bidding? remember, our president wants oil prices down and they are down. what a day for your money. in a moment we'll show you the latest on jobs and the state of the economy. "varney & company" sb to begin.
9:02 am
>> first thing this morning we received a series of reports on the state of the economy actually on the state of the job market. tell me more. >> my over with economic data this morning channel your layoffs number of planned layoffs by u.s. companies came in at 53,000 in november. that's actually 30% lower than in october that's the good news. but the trend overall not positive. more people being laid off. but we should point out that job market remains strong, and if you do lose a job there's a very good chance to find another one and national employment numbers this is number of people employed in private sector came in at 179,000 short of the estimate but that really strong number in october revived down by just 2,000 so that was a strong number overall positive construction there hiring up 10,000 that is strong as well. and then we have initial jobless
9:03 am
claims come down half an hour ago 231,000 that's a little higher than expected but down 4,000 from last week. look that's a number that if you're looking for sign of trouble in the economy you look at those initial jobless claims i don't think that's showing any sign of -- real problem at all in the economy. still very good. [laughter] >> come on. stuart: right on this one. some weakness here. those are not as strong numbers as i thought the -- >> slow it down but not qeak. >> slowing down -- surprise accurate story here. i want to bring in economist, and steve moore, he's the chief economist with a heritage foundation is author of the book, trump anon ims there it is on your screen i know steve you dismissed talk of recession any time soon but federal reserve says economy is slowing and gdp numbers show same thing. the market is tumbling in part because of what is e clearly a slowing down investors disappointed your response.
9:04 am
>> well, it's pretty rich for the fed to say that economy is slowing down because i think actually they've been a big part of the slowdown. by the way what we're talking about on the slowdown is economy over the last six months has grown at a little under 4%. and right now the latest forecast is for the fourth quarter to be somewhere in the two and a half percent range is that a slowdown from -- >> rate of -- it is a disappointment steve when you came out with with those tax cuts you were telling us consistently that we would get 4% growth we got 4% growth in one quarter. you've got to -- this is a slowdown slow down in rate of growth. >> when you go from 4 to 2 and a half percent that's a slow down but i'm optimistic about the future, in fact, there's a -- mythology like a sugar high from trump tax cuts which is retick louse these tax cuts don't expire on january 1 webcast 2019 or expire until 2014 or -- i mean 2024, 2025 so rosen next
9:05 am
year what is your number for growth next year? >> i'll still on three and three and a half percent range which is very positive and i'm in that range for 2020 as well. we're at a higher growth path you know from the 2% growth we were at the under obama so i look -- by the way, these low oil prices are good for the economy. they're great for consumers they're great for manufactures they're great for construction are industry like a tax cuts for the entire american economy when you see what's the oil price at the right now. a little about 50 dollars of a barrel so that's all very positive. >> okay. all we have to do is get this trade situation if you get some progress, on the trade negotiations between china and trump, where you get real progress because it appears that what happened over the weekend that chinese have been walking away from that. then you're going to see economy explode so there's a huge upside that you're a debbie downer what's with you? >> no, i'm not look you've got
9:06 am
4% growth in the second quarter. three and a half in the third quarter. maybe about two and a half in the fourth quarter. i call that a slowdown in rate of growth and i'm not surprised maybe some saying keep on with the slowdown and recession soon. >> but this is so important for investors towns the reason the economy has slowed down in the last two months or so has been because of the fed has been way too tight. by the way trump called that the day that the fed announced its latest interest rate increase that this was going to be very negative for the economy and it has been. there's not inflation out there. they are -- combating phantom i'm a hard dollar guy and there's deflation about when you get the oil prices fallen 20 barrel dollars a barrel, that's a sign of deflation or reimpact and deflation is bad for the economy. so get can be keep the interest rates where they are.
9:07 am
keep providing dollars for the economy, and we'll be fine. i think this is a fed inspired slowdown. >> got. steve moore thank you very much indeed. i want to bring in stock market watcher john leifield i want to talk about price of oil steve moore knows what he's talking about it is cheap for economy but is it good for the stock market >> no i don't think it is. it is good for the economy you have gas prices low i think they have a lot to do with lower retail picking up in the the past quarter. however, you talk to shale oil drillers they need it around 60 dollars to make oil profitable to drill and extract we're looking at 3 million extra barrels day in west texas alone by 2023. that doesn't happen with 40 dollar oil. >> what we've got from o'opec is -- they're going to cut production by a million barrels per day. that's nowhere near what we thought they were going to cut that's why oil is down at 51 a barrel that's another 3% down today and you say that's bad for stocks. >> bad for stocks what happened
9:08 am
was iranian sanction exemptions stu they thought it coming off l market and saudi opened up spigot that's why they're so depressed right now. >> now huawei executive at the request of u.s. authorities arrested on december the first the day of the dinner with xi jinping and donald trump i have to believe that that's what derail ared market this morning. >> there's no doubt it be. this is absolutely insane to me i think we for painting chinese into corner that they can't realistically get out of a power they're fighting game and ended in 1941 motto never again and first formed that's how they feel america is treating them now this makes it worse. >> you can't get a deal with china if you -- beat him up and they have are to walk away by saving fate and with this kind of thing going on they can't walk away and save face. >> any country should be and this is not a zero some game this is not a real estate transaction to win it all.
9:09 am
this is not something that we need to win everything against the second biggest economy in the world. >> a ton of news coming at fuss including news about about facebook i need your comment on this. facebook britain has released internal facebook e-mails that show that facebook collected phone and text messages from android devices hits keep on coming here. would you buy the stock would you sell it? i don't know if you own it or not? >> i'm not selling it -- but they cannot do anything wrong politically exactly opposite of amazon bezos come out to raise minimum wage he says i'll deal with department of defense and now they're going after facebook politicians want to go after somebody if they're going after banks they're going after them now they go after big tech companies this is going to hurt facebook but they have two and a half billion people a month that use one of their either apps it is biggest audience in the history of the world. i think facebook is in a good position here. >> question was in the u.k. is now dealing with this -- did facebook sell access to the
9:10 am
records of techs and phone calls that people were making from the android devices we know from cambridge annlitica reading layers to contend. they're not at that tech meeting at the white house today, right? >> facebook is not, no. powerful all of those -- and sangdburg but this is a negative -- it is a negative. for a third party, you sell information about me and you, to a third party without you knowing. without me knowing it including potentially who you're calling and tengessing are they doing that too we don't know so we have to get to the bottom of that. that's bad. [laughter] i have to try to understand -- [laughter] stay there futures down big time over 400 point down for the the dow industrials. about 140 down for the nasdaq. then there's google, working on a censored search engine for
9:11 am
china. google chief is going to -- schedule to testify before the house judiciary committee next week. i want to know, is is he going to get grilled about censorship in china? we're talking to a member of the judiciary committee in our next hour. and then they arrest a huawei executive that happened on same day that trump and xi held that same dinner i want to know is that significant or deliberate? china expert michael pillsbury on the show today and ask him that question . by the way, he is next.
9:12 am
9:13 am
and just like you, the further into winter we go, the heavier i get. and while your pants struggle to support the heavier you, your roof struggles to support the heavier me.
9:14 am
crash! and your cut-rate insurance might not pay for this. so get allstate, you could save money and be better protected from mayhem like me. mayhem is everywhere. so get an allstate agent. are you in good hands? yeah markets selloff that's what it says and that is correct we're having a selloff we're going to be down about 415 points. we are on the the air by the way. liz. >> forgive me. >> we're down about 450 points at the opening bell. same store sails down craiger what's happening to that stock it is down 1% down to 28 buck per share. a red flag on the economy. another one, what's going on with credit cards liz now is
9:15 am
your chance. >> sorry forgive me i was working another story tell you about that in a second rejection rates are for card applicants came in very high according to the new york fed also involuntary bank account closures because of problems with credit card payments, also a five-year high. so our legends brace for anotherring in for economy is that lenders are bracing for a slowdown. i mean, interest rates are relatively low so this to be happening another weird kind of -- thing happening in the -- >> credit card link for the economy people not paying their cars to get their bank accounts shut down so -- >> that hurts it really does. let's get back to these stories of the day that market story of the day, the arrest that huawei executive i want to bring in china watcher michael pillsbury was this deliberate were we america deliberately sending message with arrest of the
9:16 am
huawei executive? >> that's not usually normal procedure is stuart as you know president obama indicted five chinese military hackers had a big press conference, came front page news all over the world. that was very rue are teen discovery of the five chinese military hackers. request for extradition as a you might say ignored so a law enforcement matter, and in this case if you look at the comments of great distinguished senator ben, he's saying, i think correctly, that u.s. technology that has been licensed to huawei if it is transferred to iran that's illegal. and person ho did it can be arrested in prosecuted. >> michael what is legalistic side of this. i'm not asking the legalistic side of it but political side. >> answered wrong question you mean? >> no, no the arrest took place on december the first. >> i know. >> that was the day of dinner
9:17 am
chinese leader must have been aware of this arrest. was it therefore, a deliberate message from president trump a hardline message to the chinese? >> i can't answer that question. i have a sense that law enforcement proceedings are separate from political messaging. they request was made to canada much earlier, i believe. and she was changing planes you know that's certificate an accidental thing changing plane in vancouver and made a decision to arrest her so hard to trace this back to president trump. >>does this sour the trade relationship with china and america? >> i think that chinese will wait the to see the call indictment and charges. before they make a judgment, this is -- for americans to have been arrested. she said she's done nothing wrong and they want her back immediately. >> they haven't seen indictment yet so how do they know what she's done? >> i don't think they care in the indictment but they know senior people have been arrested at -- at the request of american
9:18 am
authorities that would happen on day of the dinner it really lookses like mr. trump pressured china. >> well this is part of a overall strategy of president trump. not just particular irs, but he's put pressure them in his book he has to get leverage on them somehow and he's had a huge break through but getting talks started agreeing to have bob lighthizer and agreeing to subject matter. they're coming to talks now with their accused of criminal activity and intellectual it shall property theft in a series of other things that are not legal this is a huge break through for trump and frankly a smart move they want tariffs not put on -- they use the phrase cease-fire is what they want for the coming -- two or three years. so it put this in larger context yes president trump is putting pressure on china. yes, it is working. yes the talks are going to start. now will staffs go back on peter
9:19 am
raises the point. that if there's no results at all in 90 days then more pressure will be brought to bear. this is pretty normal in negotiations. i have a lot of faith in chinese already moving down the road in the right direction on the it shall you should too stuart should be more optimistic about all of this. >> okay. but you just mentioned peter navarro he called you out by name -- [laughter] >> i'm not a trade guy that's true. >> for ow audience to see this. roll tape please. [laughter] >> former pentagon official mike pillsbury considered leaving authority on china said on the record tonight that he's worried that this deal could come undone. >> he said that is basically what happened it was a lot of touting, of what the chinese had agreed to and they're not into that. so -- >> i have great respect for mike, he had doesn't know trade that's not his thing. i'm not criticizing him here. but -- i was in the room had a privilege of being there. tnches you got 15 seconds to
9:20 am
respond. >> i'm not a trade guy feater is right are. by the way i have enormous respect for peter as well but he's not a former pentagon official or national security analyst we have point of view but by the way his point of impact is fair to see what happens in this new process it is very good news we have it set up in the lead. so yes, peter is right are i'm not a trade guy. [laughter] you are the the man of the hour thank you michael i promise we'll see you again real soon. >> thank you. check that market how do we open down over 400 points. we've got news on general motors cheer mary barra getting grilled on capitol hill ohio senators outraged over job cuts the closing plants in ohio. fox business has exclusive interview with her you're going to hear what she had to say about all of those people are losing their job. you'll hear it, next. so lionel, what does being able to trade
9:21 am
9:22 am
9:23 am
24/5 mean to you? well, it means i can trade after the market closes. it's true. so all... evening long. ooh, so close. yes, but also all... night through its entirety. come on, all... the time from sunset to sunrise. right. but you can trade... from, from... from darkness to light.
9:24 am
♪ you're not gonna say it are you? >> breaking news forget the organ music sears lives. tell me. >> eddie hedge fund is buying it along with we think other investment partners could be great american capitol this company is about to be flat out cash broke in january it is in bankruptcy protection but for
9:25 am
now in time for christmas, sears lives. they're going to try to rescue certain profitable stores. >> oaks. keep them alive. i'll hear you see, liz i got it stock price of general motors please. now i think we're down to about 35 bucks share this is premarket. down 1.7%. mary bhara ceo grilled on capitol hill about those job cuts and plant closures. watch this. >> there's definitely opportunity for many of the representative workers to work in other factories around country that are growing and that is our focus right now. we understand that it is a or very difficult time it is a difficult announcement to make so we're really focused on making sure they understand the situation and know option is open to them and that's where our focus is right now. tfnlings that was a fox business exclusive edward lawrence getting interview there with mary bharara i have a question, can gm general motors known as
9:26 am
government motors can they close plants in ohio? john still here. what tow say? >> we're not a communist country they can. aren't republican a free trader this is insane to me gm produces more cars than china and sees new business in china right now produces cars in the united states this is a matter of business. i don't think our government has a responsibility or a right -- they got bailed out. they got bailed out the they lost money and took 61% of equity didn't take a loan or pay back lost money on equity stake by the government which government usually does. >> so they are going to get away with it. they will close plants in ohio. i think they will and i think they should. >> here's what's aggravating about this. gm comes with a tin cup time and again not just for federal help for state help in 2008, they got a deal. you don't have to pay 75% of your state ohio income taxes for 15 years. so you know, so ohio is say okay why can't you retool your factories to handle different car products and truck products
9:27 am
unless gas prices go up and down in other words i understand you don't want government stepping in but gm sure steps in to taxpayer pockets to get help but it is in trouble. >> come on eve this all of this help they have a tax cuts to boot. look at -- >> this is a free market society and this is a company that can do regardless of all of the health it has gotten what it wants to do. so in other words i understand both sides of the argument. but gm is a can't be like playing -- and not being clear about the tax breaks it has gotten and it has to be answerable to taxpayers when it gets -- >> how long are you on the hook? there's a government made a terrible investment and detroit went bankrupt by the way and now gm is still being ruled by the goth. >> wait, wait they just got a multibillion dollar tax break from the trump tax cuts. they have a huge cut. as did every country and every company in the country and did a
9:28 am
great thing for the tax cut but does that mean they can run private companies but free market people. >> here's a wakeup call to politicians stuart when with you give tax break use better put in a rule or regulation saying you come to us and talk to us how you keep workers in there if you want those tax breaks or a footnote. >> say you get all of these breaks but you can't shut down plant you have to guarantee these places keep running. >> bad negotiation by the government that could be maybe -- mary barra will get a lot more of the same today when she appears in front of michigan health legislators not the senators in congressman from michigan. michigan. i think she'll get an earful all over again. >> a dog and pone show they want to take away by going after somebody else these guys are buffoons. a taxpayer and for four -- sorry. ford, ford sorry riff from me i'm so sorry. >> so sorry about that. ford retools its plants.
9:29 am
gm has rel to do its plants to basically accommodate car and vehicle products i don't see why they can't keep doing that they know gas prices won't stay up or down forever. so gas pricings fluctuate just do it. >> bottom line is general motor stock right now is at 35 dollars share it has barely bunched. >> it is interesting despite all -- >> it is a great yield like a four or 5% yield right now. smtion that's all best car company out there by far. at&t will give you 36.. >> okay. we've got 40 seconds before this market opens this thursday morning. and it is going to be a doozie remember market was closed yesterday in respect to george h.w. bush and his funeral open on tuesday and we saw a 799 point drop. it is going to be different this morning when we open up it is going to be down again i shouldn't say different but down again. maybe 400 points why? there's a problem with the
9:30 am
arrest of a chinese technology executive. maybe we were sending a message to beijing about trade, maybe -- but market is it that way and market is going to be down here we go three seconds to big opening, two, one, 9:30 eastern time on this thursday morning. now, in the very, very early going we're down 400 right from the get-go 401 points. look on the lngd side of the screen, most of the dow 30 are open. almost all of them are in the red. we've got three, two still to go they're not up and just open sod we've got 27 down. three up. and the dow is down 1.6% 4 and 20 points. show me the s&p please. how's that doing this morning? it is down one and a half percent. 41 points down that's a selloff. look at the nasdaq the indicator of big tech, it is down nearly 2%. so there's a heavy selling in technology again this morning.
9:31 am
let's check out the very biggest names in technology. right from the start where are we? we're down across the board 2% down facebook 3% amazon. 2% apple. alfa bet down 16 dollars and microsoft is back to 104. 405 right there. the chip makers they've been taking it on the chin recently. time. show me them today down big time and i'm really big time amd down 5% micron 4% and down 3% back to 152. the apple supplier because a is having trouble with orders for its iphones supply is taking it on chin because their orders are down. 4, 5, 2, 4, 5% when you start talking of percentage materials you know you have a selloff. yeah -- sorry go ahead. now i'm saying looking at sectors banks are getting killed again this is very broad-based city down almost 5%.
9:32 am
bank of america turn it is very, very broad base selloff. let's look at trade are sensitive stocks boeing and kat caterpillar boeing down 11 bucks. caterpillar 3m united tech all on downside china stocks we have those for you. this big selloff is partly because of the increased tension china u.s. trade. wabo all of them down china mobile is up a fraction. all right let's calm down for a second introduces what we have got john leifield with us scott martin and ash and liz with us o.c. inclined to say to you first of all, scott so much for the sang the clause rally forget it be. right. by the way stuart rarely do people say let's calm things down and go to scart martin so i appreciate that notion. i'll tell you guy it is looks
9:33 am
like again to, quote, i think the wrong week to quit drinking to your are point as you said on airplane, the great movie back in the late 70s early 80s is that you know right now stuart the market psychologically santa claus rally anything from midterm and recent fed notes tell us market is not paying attention at fundamentals to me that's a point that we're going to get through but until we do, the fund minimum wages in what fed does a trade deal as we saw that we didn't get earlier this week doesn't matter other than a few hundred points say that dow would be reverse sod market psychological isly is broken right now. it is off its medication that's going to take some time to work through. >> okay. now is the main reason for this big selloff the arrest of the huawei executive is that where it's all coming the main reason, john? >> it started with a tariff fan by the tweet by the president led to further -- >> part of the many moving parts
9:34 am
with a real concern into 2019 the global economy is slow down. and ultimately that will catch up to u.s.. >> you're all right to your point about algorithm and robots get deshaped action because when news feeds come in and when s&p 500 hits breaks down below 200 day moving average the start selling the very broad-based liquid etf and broad sector in those baskets of funds that drags market down rapidly. down nearly 500 points and i have to think that trade -- feed on themselves. yeah falling down, okay. now, with all of these headwinds, and market sharply lower, whether it china, trade interest rate you maim it. are there any group of stock or any industry which you think scott could avoid or this big selloff any group that you can name? >> yeah. there's been some silver lining to dark clouds stuart that's utilities i'll tell you you know we've owned utilities even we
9:35 am
bought them too early towards the end of the summer. just because of the fact that they were behaving well from a correlation standpoint meaning how they were acting via other sectors that are out there. other one is gold we got lucky on gold stuart we don't have enough, obviously, because you know some of the portfolios are suffering with the markets as they are. but as you remember before the elections, we were concerned about just maybe not so great outcome from the electionses and midterms worried about a bad market reaction so gld, etf we own now again noncorrelation value equity markets right now that's a place to hide to. >> how about dividend paying stocks earlier i mentioned at&t right now it is 30.46 a share it yields nearly it yields -- 6.8%. >> you have also verizon which has a great yield also you have your big oil tech companies that yield a bid and a lot go into a
9:36 am
safe harbor you know, for little problem you have is with the dividend trade came off when rates started going higher so you started seeing money come out of these dividend stocks any recession any team there's trouble entertainment now a lot of it is social media and video game and it is a good buy. facebook is going to end up being a good buy. >> we've come back a little bit. the low of the day was minus 480 now we're minus 384. individual stocks here we go. grocery store chain kroger revenue up same store sales falling short of what they expected to see. the stock is is only down 23 cents, 28 collars a share. children's place lowering its outlook if you do that, your stock goes down case and point children's place down 17%. let's get to the price of oil i think it is still at 51 dollars
9:37 am
a barrel down about 20 there you go. opec reportedly has agreed to cut production by one million l -- >> that's open. that number could change. it could. there's a number, and they're not tied down as opec tends to be. low cheap oil is not good for the stock market. maybe good for the economy but not for the stock market. >> good for economy but around 40 and 50 is hurts stock market. >> here's what's good for everybody gas prices show me please we're at 244 a gallon down only a tiny fraction overnight. but down nonetheless, that means we're off, down 57 straight days who's who big white house executives meeting at the bhows today the discussion will focus on technology and industries of the future. who's going to be there, ash? >> oracle and of carnegie and steve of qualcomm and of google,
9:38 am
jenny might be there to also from ibm unclear if trump will be there. he's not listed but you never know with the president he could head in that -- to comment but as you say talking about technologies and industries of the future. and mark zuckerberg not there. but also seen as trying to ease the tension between the administration and the tech industry. >> i do hope that president trump goes to the meeting pane confront the leader of google from chi he will be there. because pachi google proposes a censored search engine for china. which i think is unbelievably bad taste bad politics -- i think it is a disgrace you don't give a search engine to china. which they can then use to sensor a billion people and follow them and arrest them. you don't do that. >> i agree completely google is looking at the greater good argument do we do for the business to try to get into
9:39 am
china by any means necessary and right now they've said yes. >> we've got a lot of more bad publicity for guck zuckerberg and facebook stuff coming out of those e-mails that have been leased by british i don't know whether you own facebook or whether you used to own it and sold it. where did you stand on facebook at 135? >> i wish i used to own it but i still have it. now, some of that lower basis frankly stuart some of that is in high 70s believe it or not now we barely paired off a little bit when it got, you know, in 180s started filing but we didn't take off enough. but i agree request john. i think facebook appropriately valued gwinn what it stature is in social media world that it will come back the problem is with social media companies and you cover it whether it is google, twitter some of those other guys you know they've been massively smoked on this downside what that means is, for them recover it is going to take a little while longer but i believe in facebook. i still believe in zuckerberg and therefore hanging on to
9:40 am
stock here and add to it once all of this calms down that i talked about previously. >> let's move on to boeing more problems there related to lion air crash in indonesia. thanches bog omitted safety system details minimize training for that crash lion air 737 jet that killed all 189 passengers off the coast of indonesia in late october. here's what's striking about this story gordon buffoon sad they dropped the ball they were saying that boeing in operation manual basically relied on -- the idea that you just shut the system off with a switch. the pilots were -- apparently didn't know to do that and fought that plane more than 24 times in the 11 minutes prior to the crash from the get do they were fighting that plane. it was pushing that nose down to avoid is a stall speed incorrect sensors put it in that mode so you know, the pilot train. >>well stock is reacting to that
9:41 am
and fact that it is a trade sensitive stock down 3.5%. the jobs report comes out tomorrow. do you think let's gurned the block john, if -- i think it is going to be a fairly strong report 200,000 jobs plus will that put a bottom under market? >> i don't think because we have a bottom right now. this is christmas looks to me to be biggest christmas in history with low unemployment we have -- consumer confidence 18-year high. wages are up. we have great things to buy from the big tech company i think one of the biggest christmas in a history and if they exceed their billion top end revenue estimate, however, it is what happens going forward and that's what people worried about brexit and trade war. people worried about rising interest rates are. >> brexit you just mentioned brexit you're going to london reporting on this vote is tuesday. middle of the debate now still does not look good. the debate is whether the british house of commons accepts the deal theresa may worked there just speculate with me for
9:42 am
a second ash let's suppose that vote goes town to defeat rejected any idea what happens? >> parliament has given itself power to step in and decide what to do. what happens what they're trying to avoid is called crashing out you just leave a march 29th of next year with no plan in place and trade rules go effect but that would be chaos a shock to financial system and trying to avoid that. but boy it looks at this point as though this deal, the theresa may put together is not going to pass. >> what happens to theresa may? story -- >> i'm really -- i know it is speculation but let's suppose that brits crashed out of the european union. they've got no deal they're out. they're just done. then what happens to the european union you want to speculate on that? >> absolutely i think italy drops out if england drops out e corks done. it won't happen right away but it will happen shortly theresa may gives a no confidence vote. worst case is jerry are takes over. >> and then these individual
9:43 am
countries precinct their way out of their crisis to save their sector. stop i want to bring you into this. but i have the question if the brits crash out if brexit just crash out -- do you think that leads to the collapse of the european union itself? and if that is the case, then what happens to our market? it will put at the biggest risk are since with we saw the crisis and other pigs if you recall french countries it will be biggist crisis they face since then. here's the financial aspect of that if that is happen or leading into that i don't think it is bad top even think about it this way. you have to start selling british pound and frankly ironically even euro that means dollar will rally on that news which is really bad for all of our s&p 500 companies about 50% of the revenues by which are from are overseas activities. of which dollar works against as it goes higher. >> bottom line. european union collapses terrible for wall street. terrible -- >> chuck --
9:44 am
we take we pay a price. >> we're all interconnected to sct's point revenue generated overseas the yeah it's not good. >> interesting it is that time i have to say thank you to everybody. scott, john, great stuff this morning and we appreciate you being here on a very difficult day. check that market, we're still down triple digits. a loss of one and a half percent of the dow industrial average. next case. a class action lawsuit pointing the finger at pacific gas and electric for starting the california wildfires. what do you got on that? >> specific pg and serks class action suit filed in san francisco spriewr your court saying up you have to pay damage for the fire we know you have 1.4 billion in wildfire insurance but damage is so severe that pg&e look like it could be underpressure and undertrouble. the powerlines are thought to have caused this fire in northern california. the camp fire. in other words faulty powerlines and down transmission
9:45 am
problems -- caused numerous homes and builds to be scorched and burned to the ground. so this is a class action suit. watch pg&e hockey stick action right now. >> dreadful from fires you look at it and just awful isn't it. liz thank you very much. look at oil please. i believe we're still at 51 a barrel down about a buck 15 as we speak. there's background here to opec meeting we understand they've agreed to cut production by a million barrels per day. that could change by the end of the day. million barrels day is not as much as expected for the cut. there's more background here. did president trump lean on the crown prince of saudi arabia to keep oil prices down? did that happen? because president trump supported the crown prince over the khashoggi murder. john is with us who knows a thing or two about world oil market i want to know this, is the crowned prince dancing to
9:46 am
the tune of president trump or is he dancing to tune of putin who he will meet tomorrow? >> shifting to putin. >> is it? >> look what senate did yesterday. the senate took a very, very strong position on the khashoggi with the -- report from the cia director. i think that's going to have some pressure on push -- put pressure on president trump to back off a bit on support for mbs and now side with putin neither putin nor saudi arabia likes oil price where it is. i think we're going to see a little bit heftier cut may not all come at once but a deeper cut than you expect. >> because russians putin they want cuts -- to the price up -- some does not. >> vladimir putin got the new york cold shoulder in argentina, and it was very obvious everyone it was a clear cold shoulder and for someone who lives are from trump -- they did the high-five with mbs. that was before the senate.
9:47 am
hearings -- i think the senate hearings are beginning to have more weight than some people have given them. >> okay so you do expect a further production cut by saudi arabia and maybe russia -- >> i do. >> i disagree with the president position on keeping oil price low because we're at the edge of ripping heart out of the oil recovery. you know we're only a year into a recovery. and it wouldn't take much for a lot of these companies to just say okay, with these prices, we're going to strip capital out of our operating budgets next year, we're not going to produce what we thought we would produce. and now we're book layoffs in the oil patch. i don't think that's good for american oil companies. i don't think it it is good for future of the oil price so by constraining oil price today we could be guaranteeing future high per prices because of the capital cutbacks. >> fascinating john i'm sorry it is so short but it is a loaded day in terms of news. >>you're a good man thank you.
9:48 am
appreciate it. check those markets. now we're down about 400 points been down about 400 virtually all morning. have a look at bitcoin too please. we've got to guest coming on show shortly who says it is close to becoming worthless. he's going to make his case after this. what if numbers tell only half the story? at t. rowe price, hundreds of our experts go beyond the numbers to examine investment opportunities firsthand. like a biotech firm that engineers a patient's own cells to fight cancer. this is strategic investing. because your investments deserve the full story. t. rowe price. invest with confidence.
9:49 am
9:50 am
i am a techie dad.n. i believe the best technology should feel effortless. like magic. at comcast, it's my job to develop, apps and tools that simplify your experience. my name is mike, i'm in product development at comcast. we're working to make things simple, easy and awesome.
9:51 am
9:52 am
we're heading a little further south now we're down 446 points that puts it at the 24,500 level. here are the biggest losers among the dow 30. caterpillar boeing visa, microsoft and apple all of them down significantly got it. take a look at this. op-ed from market watch, here's the headline. bitcoin is close to becoming worthless. the article wases written by itulia finance professor at university who joins us now. take it away please. >> actually a fundamental reason for that and a technical reason for that. fundamentally, bitcoin is not lived up to its hype. primarily, if you look at the activity around bitcoin it is mostly around creating. it doesn't seem to have too many use cases for helping it does
9:53 am
not live up to it. but from a move from a technical perspective that's what i'm talking about in this article about the spiral to understand that you have to go back last year -- when the price was around 19,000 or so. at that point in time, the future trading started and what he could do essentiallies he could bitcoin around 5,000 while it would sell it in futures market around 19,000. and that clearly attracted a lot of arbitragers started involved in mining activities and then got impeded in ark ash a and what happened was the price of bitcoin declined and it came around where it should have been which was -- sort of the cost of mining plus
9:54 am
a modest profit. but now prices are falling and miners there thereby they make negative profits so -- >> cost more to mine this -- what i'm not sure what is meant by this but it cost more to mine it than to actually what buy it and own it. is that what's going on? >> that's exactly right and you are exactly the cost of the argument and that's not sustainable. there is a -- self-correcting mechanism of the algorithm thereby as if the price goes down and -- the cost of mining decreases so they can continue to make profit, and but it's not instantaneous with a lag and the exit could be higher than the rate at which the decline in the
9:55 am
price of bitcoin. >> but your forecast is bitcoin is worthless at a fairly near future is that it? >>the idea mining not like gold mining or anything of that sort miners are ones who effectively provide the part to keep a record of who owns what. so if the -- if the cost of mining exceeds the price of which they can buy they will stop mining. and if they stop mining, consequently there will be no computing provided to effectively maintain a who owns bitcoin and no transaction would be possible. and if there's no transaction happening and there's no record of who owns what, then all you have is a set of numbers. and those numbers are worthless. >> you make a very good case i think i understand it despite the technicalities it have. but i understand where you're coming from and we'll be checking that price. thank you very much, sir we
9:56 am
appreciate you being with us. thank you, sir. >> thank you. we better take out to check big board because we've now hit a new low moments ago we were down 500 points. >> huawei rattling markets i hate so say it but yield curve the official is in positive territory so that's the good news a bufnlg of things hitting the markets right now. >> the big negative is the arresting of the huawei executive coming on same day as the trump xi meeting in argentina. >> the president playing -- >> considered bad news and playing hardball with the trade negotiate. >> president is rolling dice on losing 1500 points on the dow to get a trade deal. >> all right we're down 500 points. google -- giant company known for the code of conduct with the old code of conduct don't the be evil. so why they building a censored
9:57 am
search engine for communist china? my take on that is next. . .
9:58 am
i knew about the tremors. but when i started seeing things, i didn't know what was happening... so i kept it in. he started believing things that weren't true. i knew something was wrong... but i didn't say a word. during the course of their disease around 50% of people with parkinson's may experience hallucinations or delusions. but now, doctors are prescribing nuplazid. the only fda approved medicine... proven to significantly reduce hallucinations and delusions related to parkinson's. don't take nuplazid if you are allergic to its ingredients. nuplazid can increase the risk of death in elderly people with dementia-related psychosis and is not for treating symptoms unrelated to parkinson's disease. nuplazid can cause changes in heart rhythm and should not be taken if you have certain abnormal heart rhythms or take other drugs that are known to cause changes in heart rhythm. tell your doctor about any changes in medicines you're taking. the most common side effects are swelling of the arms and legs and confusion. we spoke up and it made all the difference.
9:59 am
ask your parkinson's specialist about nuplazid.
10:00 am
stuart: almost 10:00 eastern time, 7:00, on the west coast. we're waiting for just a couple seconds for very big economic numbers. remember, please, the dow is down nearly 500 points. here come the numbers. we just bottom an important indicator on the service sector. i heard exasperated, wow. liz: highest mark in postrecession. telling me 65.6 on services sector. 6.2. that is a whopping good number a positive number. stuart: that implies expansion of the service sector. strong economy. liz: post recession high-water mark. highest in the current nine-year expansion. stuart: that is the service sector of economy. thursday morning 10:00, mortgage rates up or down? ashley: i live for it.
10:01 am
down to 4.75% from 4.81% last week. so the rates are definitely coming down. freddie mac saying look, we've seen the rate come down as market sell-off. welcome relief to prospective home higher who have seen rates come down. we had higher rates, higher home prices. better news for the housing market. liz: forgive, 60.7. still a postrecession high for the service sector. still going strong. stuart: we have factory orders? ashley: we do. 2.1%. estimate was down 2%. fractionally more than expected. durable goods orders revised 2.1%. this is slowing down when we're having negatives. stuart: does look like it the manufacturing sector. ashley: that is what the data is showing. stuart: if the overall data is showing weakness, slowdown in the rate of growth of the economy. that is what we're getting,
10:02 am
slowdown. brian demitric. brian, my interpretation the growth rate is slowing. what's yours? >> i think it is too. i don't think you can have a tax cut last year that was pretty nice and then the real threat, and action of tariffs all year long not expect there to be a pause in the economy and markets. that is tantamount to what we're seeing. stuart: but are we headed for recession because quite a few investors say we don't like this downtrend? are we headed for recession? >> stuart as i wrote in "forbes" a couple weeks ago, the stock market predicted nine of the past five recessions. we're getting warning signs. robert bartlet, old "wall street journal" editor said washington got the message and helpedded its ways. if we open up to international trade, keep tariffs, have a big income tax cut again, sure the economy will do great. if we stay in the holding
10:03 am
pattern we might have to watch out. stuart: that is the first time i heard you issue that kind of negative. we don't get a trade deal, then we're in trouble? >> we can't have net zero policy we had a beautiful tax cut last december, beautiful except in one respect, the marginal rate of the income tax only went down 2% to 37%. so if this tariff counterattack of 2018 results in an erase sure of the income tax, in effect, we can't expect the economy to escape the obama legacy that much. you have to have a serious permanent reduction in income tax rates if you're going to have these tariffs. stuart: brian, stay there, i have a couple more questions for but i want to bring in a stock market watcher. that would be gary kaltbaum. gary, looks like the rest -- the arrest of that huawei executive is a big catalyst for the downside move on the stock market. what is your take on this? >> when you're in a bear market,
10:04 am
good news is bad news, and bad news is worse news and that is what you're getting now. what if china decide to arrest an american technology person staying over in china right now you? never know if that is going to happen. i mean at this point in time, you know all bets are off. i am amazed this has happened right in the middle after majors major, major trade meeting. so i don't know what we're thinking. all i know it is not good and markets are not thrilled at all. stuart: what you're referring to is the arrest of the executive on december the 1st. >> yes. stuart: that was the day of the big dinner meeting, xi xinping and president trump. do you think it might be a deliberate arrest, a deliberate move against a chinese executive? just lay out that message, hard-line trump? >> i don't think they do anything by accident. so, yeah, and i think it is probably a bad move at this point in time. china is not going to sit back
10:05 am
and take this they're probably embarrassed about this. by the way daughter of a ceo of one of the biggest major technology companies in china while we're negotiating on technology companies and trade. so again i'm not so sure what our administration is thinking right now. i think this is a misstep and i think china, again, as i said, they're going to do something back, hopefully it is not too onerous. stuart: you think the stock market is on a downtrend here any know it is today and on tuesday but i'm talking longer term, are we heading south? >> yeah. stuart, last monday i told the world i thought we would have a rally i thought it would last into december and january would be the worry but we got 1600 points in five days, that was it. there is a problem when the market is crushing federal express and ups. there is a problem when i have about 100 financial stocks at new yearly lows. there is a problem when europe is two-year lows and you're seeing what you're seeing.
10:06 am
got to tell you right here, we're a goal line stand right now f we break the recent lows of the last two or three weeks, you and i in the next weeks ahead talking about a bear market for the indices. so let's hope we hold it here, at least for december. things are not looking good at all. all the evidence you need is at hand. market is flushing out, not just a major slowdown, i think recession in europe, recession in japan. we'll see what happens here. we are the strongest of all but, i don't think we're immune to the world's problems. stuart: all right, gary, we're glad you're on the show. you spell it out nicely and we appreciate that. >> thank you, stuart. stuart: let's go back to brian because tomorrow we get the big jobs report for november. are we -- give us your prediction. i think it will be 200,000 jobs plus. what say you? >> i say 200,000. the economy has been really excited throughout 2018 and that excitement continued through november. i think 200,000 easy.
10:07 am
stuart: will that put an end to recession talk? >> well that means that businesses were really enthusiastic about the policy regime that they saw in 2018, which is a nice reduction in the corporate rate and rates across the board got cut on the income tax side. they weren't sure the tariffs would go through. they locked in long-term supply chain deals. everything is great. why we saw 4% growth for those two quarters. the thing is that policy has to continue. you can't counteract with, we'll have tariffs for long-term. there will be a trade war. if you are going to do that, you have to reduce the even more the domestic impediments to production and further deregulation, and particularly further tax cuts. stuart: brian, thank you for being with us on a very important day. here is why it is important. the market is in selloff mode again. remember on tuesday we were down nearly 8:00. we --hundred. we're back below the 25,000 mark.
10:08 am
big tech names, got to check them. all of them down, facebook stock down after still downgrades it. it says facebook has too many adversar. stifel got the price of netflix. cutting it to 280. that was a. opec cutting production by three million barrels today. that number could change today and tomorrow. that price is down to 51.65. and now this. i found this, a giant company whose code of conduct used to be don't be evil, is working an censorship and surveillance project for the communist government, the chinese communist government. the company is google. once the darling of technology, now helping to create china's version of big brother. let me explain. it is called project dragonfly.
10:09 am
it's a search engine designed especially for china. it would allow the authorities there to exercise very strong censorship power. if, for example, someone searched for human rights or protests, the authorities would be alerted and no search results would be shown. that is exactly what the chinese government wants, control. what people are allowed to know and identify troublemakers. privacy? forget about it. google is accomplice knit the denial of freedom to over a billion people but there is more and it is even more troubling. parts of drag gone fly would be fly physically in china and therefore subject to chinese law. that means the authorities could track individuals through their cell phones. they would know their exact location and their history. rounding up dissidents has never been easier and google is helping. i'm trying to think why they're doing it? money maybe?
10:10 am
china is a pot of gold for google. the need to get into a market of 1.2 billion people, i can understand that but selling your soul to communist dictators remains unsavory at best. there is a movement within google to stop dragonfly and walk away from it. i hope it succeeds. sundar pichai, goes to white thousand this week and next weeks he goes to the capitol. if the don't be evil google guys go through with this, they will be the modern-day version of george orwell's big brother. that is my take by the way. coming up we talk to texas congressman louie gohmert. he is on the house judiciary committee. he will question google next week. waymo launches self-driving taxis in phoenix. you have to pay to use it.
10:11 am
they're on the roads. what about safety? what about liability, when it comes to driverless cars? we're on it. plus opec agreeing to cutout put. but with all the controversy surrounding the saudi crown prince i want to know who he is more beholden too, vladmir putin or president trump? we will ask the question. this is the second hour of "varney & company." ♪ what do you look for when you trade? i want free access to research. yep, td ameritrade's got that. free access to every platform. yeah, that too. i don't want any trade minimums. yeah, i totally agree, they don't have any of those. i want to know what i'm paying upfront. yes, absolutely. do you just say yes to everything? hm. well i say no to kale. mm. yeah, they say if you blanch it it's better, but that seems like a lot of work. no hidden fees. no platform fees. no trade minimums. and yes, it's all at one low price. td ameritrade. ♪
10:12 am
10:13 am
10:14 am
stuart: ongoing selloff. we're down 460 points. that is 1.8%. retailers reporting profits, financial results, all about same-store sales. kroger same-store sales not up what is expected and the stock is down. same-store sales in costco actually moved up.
10:15 am
costco as the stock is one of a few gainers on the nasdaq. it is up a buck 60. back to my editorial about google. yeah, they're working on a censored search engine for china and google's chief is expected to testify before the house judiciary committee next week. congressman louie gohmert is on the committee, and he joins us now. congressman i'm sure you will ask him questions about censoring conservative speech but i do hope you will ask him about this censorship vehicle that they're getting ready for china. >> yes. once it is perfected in china, it will be worth a gold mine in america, in europe, anywhere else. and you mentioned george orwell's big brother. i've been saying for a long time now that the only thing orwell got wrong was the year, otherwise he was right on track. but look, google repeatedly sold their souls. your editorial is dead on right.
10:16 am
they want the 1.2 billion or so folks in china, part of their system and they have been willing to literally sell their soul. and you mentioned orwell. it reminds me of another george, george soros because google is born in a free country and oppress others, help oppress it with other countries. george soros is supposed to be jewish but you wouldn't know it from the damage he inflicted on israel and the fact that he turned on fellow jews helped take the property that they owned. this same kind of thing. google coming from a free country, helping the oppressed but china has been oppressing for a while. email with people over there -- stuart: what can you do? you're on the judiciary committee. you're interviewing sundar pichai. what can you do? >> well, for one thing this, is something, i have got a bill, i
10:17 am
wish we could get it, hoping we could do something with it, i'm not big on massive new regulations on these providers on the internet but i do want them vulnerable. at one time they proudly proclaimed look, we're just a town square, you know, we just provide a plaza where you can come. now we know their algorithms, they filter like crazy. they have taken money from people to move people up and then they moved them down. what we've got to do is make them vulnerable to class-action lawsuits from the people that they have screwed over, they have defrauded by not using, not doing what they said. i think some billion dollar judgments will get them attention than flaky regulations. stuart: is changing the law required? >> yes it is. because they're protected. we've got to remove that. if they use algorithms to change the order of anything, that
10:18 am
basically what my bill says they're vulnerable. >> can you get support from the democrats for this. >> i would hope so, especially next week. i can't say for sure but sometimes they go directly against things they have been strongly for, like civil rights when it comes to privacy and things. if it is donald trump's privacy, they're all for violating every civil right he has but hopefully there will be a little bit of consistency among the democrats on this issue. jerry nadler, sometimes he is strong on civil rights, sometimes he abandons it for the cause of the democrats. we'll see next week. let me also say right quick about the economy, you spent a great deal of time appropriately but i hear people say the economy and the stock market interchangeably. they're not the same. there are people that are doing well. there were people that were suffering terribly under obama but obama would point and say, look, see the stock market is doing great, so everything is
10:19 am
good. no, people were suffering, but you can't go by the stock market alone, or whatever their programs use to buy and sell being determinative how people are doing in america. stuart: fair point. >> i hope we make that distinction. stuart: we should make that distinction. well-said. >> thank you, stuart. stuart: i'm sorry. i will make the distinction. that's a promise. thank you, louie gohmert, always good. we're down 440 points on the dow industrials. make a distinction between the market and economy which isn't doing anywhere near as bad. we have this. uber's biggest competitor, lyft, will go public next year? ashley: first part next year. we don't know how many shares will be up for sale and what price range. we believe lyft is valued at $15 billion. it was only founded back in 2012, all the way back in 2012, six years ago, but expected to go public next year. by the way, uber, expected to go
10:20 am
public next year. stuart: despite all the bad publicity. ashley: valuation? up to 120 billion. stuart: whoa!. that is a big number. now this, democrat leaders, chuck schumer, nancy pelosi, they will meet president trump next tuesday. other democrats are worried and pelosi will give the president what he wants, that would be money for the wall. we're on it. gm's chief mary berra is back on capitol hill. she will meet with the michigan lawmakers. she met with the ohio senators. none of them are letting gm off the hook easy for closing those plants. we'll be back. ♪
10:21 am
moving? that's harder now because of psoriatic arthritis. but you're still moved by moments like this. don't let psoriatic arthritis take them away. taltz reduces joint pain and stiffness
10:22 am
and helps stop the progression of joint damage. for people with moderate to severe psoriasis, 90% saw significant improvement. taltz even gives you a chance at completely clear skin. don't use if you're allergic to taltz. before starting, you should be checked for tuberculosis. taltz may increase risk of infections and lower your ability to fight them. tell your doctor if you have an infection, symptoms, or received a vaccine or plan to. inflammatory bowel disease can happen with taltz, including worsening of symptoms. serious allergic reactions can occur. for all the things that move you. ask your doctor about taltz. i've done all sorts of research, read earnings reports, looked at chart patterns.
10:23 am
i've even built my own historic trading model. and you're still not sure if you want to make the trade? exactly. sounds like a case of analysis paralysis. is there a cure? td ameritrade's trade desk. they can help gut check your strategies and answer all your toughest questions. sounds perfect. see, your stress level was here and i got you down to here, i've done my job. call for a strategy gut check with td ameritrade. ♪
10:24 am
stuart: u.s. steel says president trump's tariffs are helping their business. connell mcshane at a u.s. steel plant in pittsburgh. come on in, connell. how are these tariffs helping them? reporter: simple, stuart. they're making more money because american steel costs more, foreign steel costs less. it is really changed the game since the steel and aluminum tariffs went into effect. as doug shows you the process, sausage being made or the steel in this case behind us here in braddock, pennsylvania. the tariffs went into effect in march, prices of american steel got up. sense february the price is up 11%. the foreign competitors gone down 5% on average. the bottom line here has improved. revenue in the third quarter is up 15%. stuart, here's the issue. can it continue? they have hired 400 people here at this plant so far this year. some have retired and what have you, but they brought on 400 new people. they say they will keep hiring
10:25 am
into next year. we brought our show 4:00 p.m. eastern time, "after the bell," we'll talk to the ceo. we'll ask him what happens if president trump cut as deal, and tariffs go away? from talking to people around here that is a big deal to them. if the tariffs go away, a company had a tough time making a profit last decade would be right back to where it started. they want the current policy to stay in place. stuart: all right, connell, we hear you. we're waiting at 4:00 this afternoon with the ceo of u.s. steel. connell mcshane on fox business. the next question, would you get into a self-driving taxi? would you do that. they have arrived in phoenix. we have the story for you. ♪
10:26 am
10:27 am
10:28 am
10:29 am
♪ stuart: this is the one, you wanted on young sister, it came on tv you didn't want your parents to hear you watching this because you were embarrassed because they were so good. you're only 14 years old. it was fantastic. not so the case with the market, i'm afraid. we have a selloff on our hands, ladies and gentlemen. we're down 470 points. that is down about 1.9%. big tech, look at this. big tech all of it down, but those three stocks in particular, apple, facebook, alphabet, they have been taking it on the chin lately. i want to bring in jack hough, big guy on wall street here. the "barron's" senior editor no less. you tell me, jack, is it those
10:30 am
three stocks, time to throw in on the towel, admit defeat, they're down and staying down? >> growth investors, they sell to value investors. if you're someone in the tech stocks because you've been chasing price gains and haven't been watching income statements necessarily, these are not for you anymore but if you're a value investor who wants to latch on to serious cash flows because you believe the share prices will eventually follow those i think all these three companies you named look pretty darn cheap right now. facebook has 20% revenue growth, even in scenario of a slowdown. it will be a mid-teens revenue grower. pretty much the same price as broad stork market. there is disconnect. stuart: you would be fairly confident buying apple at 171, buying facebook at 136 would be a good investment two years down the road? >> apple is almost as cheap like airline or car company right now. that is breakdown lane. you don't need that much growth
10:31 am
to make that work. facebook, alphabet, dominate online advertising. facebook uses it, doesn't have any friends on the right, doesn't have any friend on the left, no one admits they use it, i don't know where the two billion people are coming from. nobody tells me they use facebook. stuart: the pr is constantly terrible for them. terrible. >> there is no one in the u.s. doing so damaging to a company so profitable. in europe they will continue to hit them over the head for fines. why would they want to kill the cash cow? they want to keep the fines coming in. when you do have new regulations. that would be the best thing for the stock. investors will understand what the new rules are. stuart: i will repeat. you think that buying apple at 171 and buying facebook at 136 would be a good investment, one year, two years down the road? >> i think these are cheap, long-term stocks for value investors. i don't like all big tech stocks. i certainly like these three. stuart: i'm trying to nail you down, jack. >> buy them now.
10:32 am
buy a lot of them. stuart: really? >> for facebook don't tell your friend you bought it. it is not popular. like a tobacco stock you should buy it. stuart: you should know go with the headline, the grabbing headline, first response, yes, stuart. >> give it another go. i will pound the table. stuart: do it. >> you should buy these stocks now. what is that table made of, i don't want to pound it too hard. stuart: why we're the top-rated market show in the united states of america. we get clean cut answers. got one more for you? >> okay. stuart: gm chief mary barra was grilled by ohio senators yesterday, just a second, listen what she said about those plant closures and layoffs. roll the tape. >> this industry is transforming and we need to make sure general motors is around for the next several decades. we have responsibilities stakeholders, employees, people that retired from the company, our investors. we want to make sure we have a strong general motors and ready and lead in rapidly changing transportation market.
10:33 am
stuart: do you think she will get away with closing car factories in ohio when they are basically government motors propped up by the taxpayer? >> i think mary barra is the best performing u.s. car executive maybe of my lifetime. stuart: what? >> she has taken an impossible job turning around gm. she has done a wonderful job. first of all, gm is not employment agency. that is a stock trading at humble valuation because people think we're at peak levels for car sales. i'm not sure why these senators are trying to man-splain to mary barra. stuart: good lord, man, they got all kinds of tax breaks from ohio and federal government. >> we want cheap oil, cheap gas in this country. that is driving demand for big suvs, the smaller sedans, people are not buying them anymore. she doesn't want gm making them because they're not profitable. she has a fiduciary responsible to maximize profitability of her
10:34 am
company to shareholders would jack hough buy general motors of 35, dividend yield of 4% at $35 a share? >> answer is yes? you know what the best thing for gm? the next recession. wait a second you mean to tell me the profits aren't disappearing? the profits come down but company continues to make money through recessions because it has been transformed financially? yes. the stock resets at higher valuation after that recession. you will have to wait a while for price appreciation but it does look cheap here. stuart: that is quite a performance from jack hough. facebook, apple, general motors. liz: and he pounded the table. stuart: what i always ask for, pound the table. ashley: the perfect performance, jack. >> thank you, sir. stuart: you'll be back. next case, waymo launching the their first driverless car service in arizona. it is on the roads, a taxi. our next guest is the vice president of strategy and policy at cognata.
10:35 am
that is a company which helps self-driving car technology. he is with us from cognata. how far away, you have got to convince people, if you're helping car companies get into the system driving car business, you have got to convince people like me that it's safe to get into one of these things, to trust it. how far away are we from that? >> safety is an ongoing process. there is no end to safety. what we do is provide ability to tis the car in virtual world, in simulation. we build a 3d realistic world, fill it with weather, traffic, people, things they face once in the real world, we measure safety before the cars are there. stuart: you work with audi? >> we work with aid, the autonomous subsidiary of audi. stuart: so you construct a car,
10:36 am
self-driving car, kind of a test car in some kind of a laboratory and you see how it responds to weather conditions and other cars on the road, that kind of thing? >> better yet, we deliver a software solution where our customers, makers of the self-driving cars can test their software before they even start needing to build the car itself. so they can put their software into our system and test it across all these environments early on. stuart: okay. so it's a software package, that is what you produce and you sell it to a car company, they put it into their cars and bingo, you've got yourself a self-driving car, that's isn't. >> something like that. stuart: i'm trying to simplify it. >> we're involved with the carmakers at a very early stage so that they can take their software, put it into a virtual world, test it against everything that they might have to encounter before they're on the roads with you and i. stuart: can you make me feel secure a couple years down the road, i'm in a self-driving car, there is nobody behind the
10:37 am
wheel? i'm in the passenger seat, we're going down the highway, i'm surrounded by whopping great big drugs and other cars with a driver? are you going to make me feel comfortable? you think i will be comfortable with that environment? >> this is the exactly the value of simulation. by being able to test these cars virtually before they're on the road, we can measure how safe the cars are, how well-they're performing, and most importantly how much the safety is improving over time, test after test after test. we do this at enormous scale. in simulation there is no reason a car can't drive millions of miles, gape that experience overnight in the cloud. stuart: it's pretty good. how long before we're all sitting in self-driving cars? >> this rollout will continue to be gradual. as you mentioned we're seeing cars in limited situations today. rollout will continue. it will take time. challenges will increase or rather, the capabilities will increase but i think we'll see a
10:38 am
lot of progress in the next five years. stuart: is waymo way out front? >> waymo is pretty well out front. part of what enabled them to get there is their expensive use of simulation. they have been very public about the fact that they drive millions of miles a day in simulation. stuart: so you essentially are simulator guy? >> we are the simulator guy. stuart: cognata. thank you for joining us. we appreciate it very much. the dow hit a new low, down 518. we come back a little bit. we have a 500 point loss. boeing has a huge loss, down 4.7%. they have problems related to the lion air crash in october. the latest, liz? liz: from "the wall street journal," boeing omitted software operations manuel and minimized training of software that forced the nose of the plane down erroneously a dozen times in the
10:39 am
first 11 minutes that crashed off indonesia in october and killed 189, 19 people. ashley and i were talking about it, gordon bethune says they dropped the ball on this. in other words there was no redundancies in the system to back up an erroneous read on the software. boeing is saying in the manuel turn off the system. ash and were talking, prior planes, you pulled back on the control yoke, it overrides the software. still questions remain what is going on. stuart: another negative on top of the bad trade news. boeing taking it on the chin. 16 bucks down. to "brexit." the vote is next week. britain's prime minister theresa may says there are three options, this is what she says. three options, approve the plan, face a "brexit" with no deal or complete reversal of "brexit." ashley: that's right. stuart: i want to know which it is going to be. i will ask a member of the european parliament about that in our next hour. first opec meeting agreeing to a production cut but when it comes to alliances i want to
10:40 am
know just who the saudi crown prince is more loyal to, russia's putin or america's trump? we'll be right back. ♪
10:41 am
10:42 am
♪ ashley: despite the arrest of high-profile chinese telecom executive asia watcher michael pillsbury tells us a china trade deal can be achieved. take a listen. >> they're coming to talks now. what they're accused criminal activity, intellectual property theft and series of other things that are not legal. this is a huge breakthrough for trump. frankly a very smart move on the chinese side. they want these tariffs not put on. they use the mandarin phrase, cease-fire, what they want for the coming two or three years. so put this her arrest in larger context. yes, president trump is putting pressure on china. yes it is working. yes the talks are going to start. will the talks go back on? peter navarro says if there is no results in 90 days, then more pressure will be brought to bear
10:43 am
snacking can mean that pieces get stuck under mike's denture. but super poligrip gives him a tight seal. to help block out food particles. so he can enjoy the game. super poligrip.
10:44 am
stuart: look at this, del frisco's, you know the steakhouse people? up really big, 12% higher. why? there is activist investor group called engaged capital, they're pushing del friscos to sell themselves. apparently good news. >> >> price of gold? up again i believe, we're at 1247, five dollars higher. bitcoin, where is that? below four grand. 3600 is the price.
10:45 am
opec agreeing to cut out put at their meeting today. we don't know -- they're saying a million barrels a day. that could change that number, today and or tomorrow because tomorrow the crown prince of saudi arabia, left-hand side of your screen, meets with putin of russia. let's bring in, we have with us walid phares right now. i have got a question about the price of oil and the relationship between president trump and the crown prince and the crown prince and putin. who is the crown prince dancing to? who he is listening to? is it president trump, who wants lower prices, or is it vladmir putin who wants higher oil prices? >> there is no doubt about it, that mohammed bin salman since he came to power, basically he came to power based on resumption of renewed, saudi-u.s. administration, if possible relationship. so yes, mbs is basically, has been coordinating with the trump
10:46 am
administration but obviously he needs to have relationship with other powers around the world, whether it be the european union or, of course, russia, and other forces, specifically that he has been under pressure, as you know, because of the khashoggi case and by the u.s. senate and congress in general. so it is in the margin of his manuever, he strategically relates to the administration here. stuart: president trump is sticking with the crown prince despite the khashoggi episode. president trump wants lower oil prices, not higher oil prices. so at the end of the day you're telling me that essentially the crown prince will back up president trump's desire for lower oil prices and not submit to putin's demands for big oil price cuts, oil out put cuts? >> i have no doubt about it. he is coordinating, the prince is coordinating with the white house and with the administration in general. how to expect in terms of you know, oil price, i think he will
10:47 am
go with the american demand, but he is showing that he can speak with the russians and he is showing this to other quarters in washington who want to level a lot pressure on the prince because of the khashoggi affair. stuart: what do you make of the senate's, the senate met with the cia director some senators came away look, mohammed bin salman was really behind the murder and they are going to try to take some action against him? could that have any result? >> look, i agree with the senators that an investigation has to take place and go all the way to discover who actually gave the order but what order? the original order may have been, by the prince, to bring that individual, mr. khashoggi, to saudi arabia, not necessarily what many in the region including in turkey and qatar saying he ordered the actual killing in same scenario occurred. that is for the investigation to tell us about.
10:48 am
what i'm worried about the fact that we are demanding punishments on saudi policies and on u.s. policies regarding yemen, regarding qatar, regarding iran is a little bit beyond what we should do. we should conduct the investigation and then maintain our foreign policy with the saudis regionally speaking. stuart: got it. the price of oil is down over $2 a barrel. that is over 4%. we're back to $50 a barrel. i think the president got what he wanted. thanks very much for joining us, sir. it is always a pleasure. we appreciate it. thank you, sir. >> thank you so much for having me. stuart: coming up democrat leaders, schumer, nancy pelosi headed to the white house next tuesday. that is ahead of a potential government shut down. other democrat ares are worried schumer and pelosi will give too much away in the president trump's demands to build the wall. we're on that story. ♪
10:49 am
hi i'm joan lunden. today's senior living communities have never been better, with amazing amenities like movie theaters, exercise rooms and swimming pools, public cafes, bars and bistros even pet care services. and there's never been an easier way to get great advice. a place for mom is a free service
10:50 am
that pairs you with a local advisor to help you sort through your options and find a perfect place. a place for mom. you know your family we know senior living. together we'll make the right choice. ♪ there's no place likargh!e ♪ i'm trying... ♪ yippiekiyay. ♪ mom.
10:51 am
10:52 am
stuart: there is a selloff in two markets. start with oil. a selloff there, puts it down 4%. that is better than two dollars a barrel. the we're back to $50 even. how about the stock market? we're down 2.25%. that is 560 points. that follows a near 800 point
10:53 am
loss on tuesday. trade sensitive stocks really taking it on the chin because there is ratcheting it up on trade tension between america and china. boeing down 5%. that is $18. caterpillar 2 1/2%. a small loss for gm. a small loss for united technologies, trade sensitive issues on the downside. nancy pelosi and chuck schumer head to the white house next tuesday. they will meet with president trump. they're talking funding for the border wall. martha maccallum with us, host of "the story." i'm told other democrats are worried that schumer and pelosi will hand over too much to president trump? >> it is classic in terms of the way things are operating right now. you have the progressive wing of the party, which considers any money at all goes towards border security an aggressive move against immigrants essentially. the other side of the story for democrats, interested in making some sort of deal they can
10:54 am
essentially get the issue of border security off the table. they don't want to be accused of being, you know, loose at the border, not taking this issue seriously because americans see the images all over their television. they know that there is a porous border. you can't have a country without a border. stuart: immigration seems to become a negative for the democrats. that is real reversal where it was the past summer. i think the democrats don't want to have the government of the shut down over issue of border wall, because they lose. >> essentially will look like it is their fault the government shuts down. the president is hard-line in his position. he wants five billion dollars, he wants to call it a wall. i think there is some middle ground here as both side could decide that essentially, if democrats decide it helps them to take the issue off the table, if they don't want ads how weak they are on the border getting around to the next election season, that could be helpful for them, however there is too many of them who don't want to
10:55 am
give the president any bragging rights to be able to say, i built the wall. stuart: so the left is running the democrat party? >> absolutely. you know who is the loser? the american people because the american people want some compromise on this. they want a secure border. they know it is possible. you know who else is the loser? the immigrants trying to come over. this woman, climbing, dropping a child over the border. a woman who got across, had her baby there. they are traveling in dangerous situations. like the rest of immigration can get them out of immigration system with a process not dangerous. stuart: i remember you took your show i think. >> yes, we did. stuart: took it to the border. was it utter chaos? >> no it was not utter chaos. we were at a controlled border area where the trucks come in in and out every single day. there is a lot of process. the fact of the matter, people know where the holes are. you can secure the border in many ways. technology is necessary, if
10:56 am
there are geographic areas as we all know do not need a wall. people want to call it a fence, some want to call it a wall, when you look at it, it is ridiculous. politicians have real marriage to these words i think it is unnecessary. i think you wan secure the border and both sides know, perhaps the ceremonies we've been watching over the last couple days, it continues to today for president george herbert walker bush could allow cooler heads to prevail and look we're securing the border. if you want to call it a wall, call it a wall. if you want to call it fencing call it fencing. let's get together to get something done. is that a novel idea that could possibly happen? am i dreamer? stuart: i thought it was a real honor i could sit here yesterday to be commentator on the funeral. >> i couldn't agree more. i couldn't agree more. it was great to be there with bret baier, brit hume, and chris wallace watching this moment in history. i think it is so important that
10:57 am
schoolchildren watch these events yesterday and today. i hope they do. stuart: thank you, martha. >> thank you, stuart. great to see you. stuart: check that market. this is the low of the day. we're down 580 points. we will be back. ent opportunities firsthand. like a biotech firm that engineers a patient's own cells to fight cancer. this is strategic investing. because your investments deserve the full story. t. rowe price. invest with confidence. . .. ♪ ♪ ♪ ♪
10:58 am
♪ this holiday season, families near you need your help. visit now to donate.
10:59 am
11:00 am
stuart: the arrest of a top chinese tech executive, opec so far has agreed to only limited oil production cuts. those two news items have produced dramatic results for your money. start with this. the chief financial officer of the giant chinese company that makes cell phone huawei. at our request she was arrested in canada. it's alleged that huawei broke your sanctions on iran. as president trump sending a message to xi jinping. furthermore that arise to place on december 1st and that was the day of the trump dinner
11:01 am
meeting. again, were we sending a message? a hardline message. stock tumbling on that news. next, opec agrees to cut oil output reportedly the saudi's don't want to cut as much as other opec members feared question, are the saudi's doing president trump getting in return for his support of the crown prince and the jamal khashoggi case. mr. trump wants cheap gas and that's what we've got. here's the state of play for your money. stocks way down. the dow is up 585 come as about 50 points. that is 2%. nasdaq composite down 1.7%. the tech stock not doing as badly as other sectors. the price of oil, look at it. at the $1 a barrel by the way down 3.5%. remember, please, gas has dropped for the 57th straight day. the economy remains -- i'm going
11:02 am
to save remains valid. new private sector jobs up 179,000. tomorrow the big jobs number my money is on well over 200,000 new jobs for november. the third hour of "varney & company" is about to begin. ♪ important number on how much oil we've got in storage just came in. >> down 7,232,000,000 barrels. that is triple what the markets were mean. stuart: we've drawn down. first time in many, many weeks. and so, the price of oil was down to 5020. now we are faced in 94. it didn't make that much difference. it didn't. the oil that's really taking it on the chin today. a look at the big word, too. a new low as of right now we are
11:03 am
down 614 points. that is to .5%. it is time for the guy who is the host of the show, making money. his name is charles payne and it's within this morning. would you make of this? what's going on? zero whole lot. >> i do find it interesting the overwhelming majority of the pressure on the market or from things that are question marks, unknown. you know, not necessarily factual or fundamental. this makes investing hard. when someone wants to be a long-term investor, you know, we don't know what's going to happen with this or that, so there are question marks but then the fundamental stuff to your point come in the solid jobs report and all the other underpinnings, fundamental underpinnings are pretty strong. it becomes really tough foreign investor. stuart: what you make of this arrested a chinese executive
11:04 am
firm huawei on the same-day president trump was having dinner with xi jinping? >> maybe was an attempt is send a message peer by the same token this was more of a criminal arrest. i was going through some of these older articles. reuters had a report in 2012 of a hong kong firm that does business selling a barcode equipment. marco rubio, they taught them not to do any business with them. stuart: you're very generous. >> this is something we have to do. stuart: y on december 1st? >> she was there. stuart: recall that the canadian. >> they had to order the arena. she gave a speech. i like your chinese
11:05 am
pronunciation. the south china morning post reported in the essentially said they thought some of these regulations to some of the sanctions would violate them and pay fine for the cost of doing business. sort of imagine like ups or fedex okay with getting parking tickets to deliver packages to new york city. so they haven't taken this seriously. and i think we've got a lot of a lot of people on this is not about president trump. tom cotton, marco rubio, a lot other people saying this is a significant issue and i think this is out for her with or without president trump. stuart: if you want a trade deal with president trump come you got to allow xi jinping to save face. it's very difficult when one of your top people have just been arrested. >> by the same token we spent eight years criticizing barack obama for being feckless, for being too wimpish to allow china
11:06 am
to build islands and make them into militarize them. if there were going to fight or were not. we criticize president obama in the middle east so we took away the ability to win from our commanders feared they have the radios and the pentagon just to hit targets. we applaud the fact president trump was going to come in and fight the fight we had to fight. do we have to fight, but allow him to fight and to win. stuart: tommy about oil. just struggled back to $51 a barrel. why is $51 oil cheap? why is that bad for the stock market? >> big oil companies weigh heavily on the market, but it's not bad for other parts of the economy. it's a conundrum, but it is overall even though we are top producer it's a net positive considering and they are out there spending money big time
11:07 am
and it helps when they don't have to spend as much gas. there's a happy medium and a 51 this north of 60. >> is a good for the market is tomorrow morning we find we've got more than 200,000 new jobs created? good news or bad news for the markets. >> number is 220. it brings the fed back into the picture just as we were getting them out. north of 220. we go down because the feds back into the picture. the adp report under 200,000 and wages are less than 3%, those are the one-two combinations that is something of a relief rally. stuart: to doubt the moment is that 24,400. the all-time record high as 26,000 change. we are not that far away. >> i don't think it's just how far were down. i think it volatility.
11:08 am
these gigantic swings. i put a chart on my show yesterday at the two-day session as soon as the s&p 500 dipped a little bit, the machines went crazy. look at that chart. it goes straight down like someone dropped off the empire state building. it went straight down. $33 billion instant selling. >> out of the ats. >> sell, sell, sell. stuart: will be watching you. >> we are going to try to find a lot of stocks on sale right now. >> please, please. charles, thank you very much. lyft signing paperwork to go
11:09 am
public. "the wall street journal" says the ipo will happen in the first half of next year that is for lyft, lyft. in europe britain's theresa may has laid out three scenarios for brexit. one, approve or plan. too, face a brexit with no deal whatsoever. or three, see the complete reversal, which i guess will be a second referendum. so what is going to happen? believe me we've got an answer. here at home, several big tech companies at the white house today including google, microsoft, oracle, qualcomm. what's on the agenda? president trump will meet democrat leader pelosi and schumer at the white house next day and they will avoid a shutdown over border while funding the policy says she will not accept a daca deal in exchange for while funding. why not push in mark stay with
11:10 am
us. it is the third hour of "varney & company." ♪
11:11 am
11:12 am
11:13 am
stuart: and the last hour, one of our guests, congressman louie gohmert for some reason went out of his way to bring up george soros and made unsubstantiated and false allegations against it. i want to make clear those views are not shared by me, this program or anyone at fox business. fresh lows for the dow up 680 points at this point. that is to .7%. this follows the near 800-point loss on tuesday. more headaches at facebook. british lawmakers releasing internal facebook documents. they include e-mails between zuckerberg and his employees.
11:14 am
it shows him giving developers preferential access to user data. facebook stock is down $2. a huge loss in a major downside move for the overall market. brexit, debate but a britain's parliament next week or prime minister theresa may said today at lawmakers have three choices. one, approve her deal. too, face a brexit with no deal. that is crashing out. or three, the reversal in which case you stay in says. europe's parliamentary member come a long time since i saw you. welcome back. which of these three options do you think is going to happen? >> it's very hard to say. if anyone wondered whether there is such a thing as the british establishment the last two years would've moved any damage ever since the vote have been in more people voted to leave the european union and that's ever
11:15 am
voted it anything of british history. either to stop brexit altogether if they can't manage back at least to stop it succeeding. that's a battle going on in the building that you can see behind me. anyone who told you for sure what's going to happen, don't just not listen to what they said. don't do anything they say subsequently. no one can tell you how it's going to end. stuart: okay come you can't see this fund on the left-hand side of the screen another new low for the dow industrials up 700 points. 712 points and heading south by the looks of it. maybe brexit has something to do with her downside move because of the parliamentary vote is held and if britain crashes out of europe, i'm going to suggest that europe itself, the european
11:16 am
union collapses. am i going too far? >> i think so. what people mean by crashing down his trading with the e.u. like any normal country under wto terms. that is what the united states does. the u.s. has crashed out, has no special trade arrangements with the e.u. beyond the technical ones that i'll advanced countries have with each other. i can still buy iphone somethings in europe, so it doesn't mean the barriers go up. it was not anyone's preferred outcome. you are right. nobody wanted to see figure his own crisis. nobody wants to see this location with her friends and allies that would've been much better to have a deal. they are put in front of the u.k. deliberately harsh and then did terms. terms that no country could sign up to.
11:17 am
terms that would include us being permanently potentially in the customs union. in other words not able to do trade deals with you or anybody else until the e.u. decides otherwise. unlike the e.u. membership golf, and this withdrawal deal has no exit clause. stuart: it looks like a dire situation over here. >> it is certainly been messed up and i'm afraid the reality is there is nothing inevitable about this. every time the prime minister had a choice to make she tended to make a bad decision because she was never really prepared to walk away. at the beginning of the process in what turned out to be the last few weeks, if trump were here, he would be shaking it up a bit. i've said some hard things about the current president, but no one can doubt that. he would've never brought back a deal of this kind of put it up on his legislature.
11:18 am
stuart: i hope you can join us again in the near future because we value your analysis. >> a great pleasure. stuart: estrone relatives right there. check going. the investigation shows that the flight control system wasn't even mentioned in the operator's manual. investigators believe that system played a central role in the crash. look at the stock go down over 6%. pacific gas & electric or there's a new class-action lawsuit which blames the california utility for the deadly wildfires in california. now it's just on 71 cents, 2.5%, $26 on pg&e. marriott company reported her famous chinese intelligence may be behind the massive data breach that affect the 500 million people. down another 1%. check the big word, please. we were down 700-point just a
11:19 am
few moments ago. now we are down 678 points. what a day. we will be back. snacking can mean that pieces get stuck under mike's denture.
11:20 am
but super poligrip gives him a tight seal. to help block out food particles. so he can enjoy the game. super poligrip. that's it. i'm calling kohler about their walk-in bath.n. my name is ken, how may i help you? hi, i'm calling about kohler's walk-in bath. excellen[ pop ] happy to help. huh? hold one moment please... [ finger snaps ] hmm. the kohler walk-in bath features an extra wide opening and a low step-in at three inches. which is 25 to 60% lower than some leading competitors. the bath fills and drains quickly, while the heated seat soothes your back, neck and shoulders. kohler is an expert in bathing, so you can count on a deep soaking experience. are you seeing this? the kohler's walk-in bath comes with fully adjustable hydrotherapy jets and our exclusive bubblemassage. everything is installed in as little as a day by a kohler-certified installer. and it's made by
11:21 am
kohler, america's leading plumbing brand. we need this bath. yes. yes you do. a kohler walk-in bath provides independence with peace of mind. call to save $500 off bath walls with your walk in bath or visit for more info.
11:22 am
stuart: well, the load that there day was a minus 715 points. right now we are minus 691.
11:23 am
still very much a down day. the dow is up to .75%. this afternoon, and several of the big people at technology companies will go to the white house talking technologies of the future. come on in, blake urman and tell us all who was going to be there or what they're talking about. >> the heads of microsoft, oracle, google, qualcomm along with the president carnegie mellon university, m.i.t. as well and henry kissinger. they are going to be made with top members of the trump administration to talk about things many of us can't wrap our heads around. a.i. for example, quantum computing, 5g technology, advanced manufacturing assaulted the trump administration will be represented by the lake of jared kushner, donald trump. robert mike kaiser, the top trade rep as well will be there because possibly the issue of
11:24 am
core searches with the trade team is dealing with right now will be brought up in the discussion as well. larry kudlow will be in the room as well. stuart, the president not expected to be at us. we are told it is a possibility he will drop by the white house says a series of meetings dealing with the likes of a.i. down the line that they're going to get into. stuart: i'd love to see the president drop in antarctica have die google about that censored or something engine for china. >> they are anticipating the ip theft is going to, then this conversation. stuart: blake irving, thank you very much. gm ceo mary barra about her plans to lay off thousands of workers or the qureshi told i wrote edward lorenz after the
11:25 am
meeting. roll tape. >> is definitely opportunity for many workers to work with other factors around the country and that is our focus right now. we understand a very difficult time, very difficult announcement to make and so we are focused on making sure they understand the situation, they know the options open to them and that is where our focus is right now. >> gm stock right now is $34 a share. general motors or any carmaker cannot close a manufacturing plant in america's heartland without some consequences. meanwhile, the market very close to the world today now down 708 points. two pointy%. back in a moment.
11:26 am
11:27 am
11:28 am
11:29 am
stuart: love today. here we are. every single one of the dow industrials, all 30 of them in the red all down in the dow industrials are down over 750 points. that is a 3% loss. we've been down all morning. the selling has accelerated in the last couple of hours down 754 as we speak here joining us now, and u.s. global wealth management, what is with this selloff because for now down 1500 points in 1.5 days worth of trading.
11:30 am
visit the economy economy? what is it? >> it's an overreaction to a couple things. one is the ongoing issue about china and the u.s. there has been some over the weekend that we would see some resolution. this is a long game and it's not going to be done over the weekend. >> the markets reacting to huawei in the same day he sat down to dinner with xi jinping. thus what you're talking about. >> this represents a new dynamic in escalation in terms of the u.s. trade complex. stuart: you think it's overdone? >> there's a lot of back-and-forth and were not going to sell it in 90 days. ultimately you will see the two parties have to have common ground. everyone keeps the merchandise trade deficit. other issues here. the issues raised at the u.s. trade representative investigation report and on the chinese side making sure whatever is done doesn't undermine 25 initiative.
11:31 am
those are the two critical issues. after that. >> it can take some time. trying to wear down and a lot of people saying it's the economy that were headed towards a recession. nail that one, please. >> first of all heading towards a recession with the more avid and peered first of all, we are seeing some softening in the interest rate factors, but we are certainly not seen a fundamental shift in business confidence. we are certainly not seen a fundamental shift in consumer spending or consumer confidence and importantly not seen the issues we see the banking system where there pulling back credit. all the things we look at in terms of the indicators of the health and strength of the economy remain intact. we don't see anything that says the economy is rolling over. we are perhaps coming off the boil of it which is some good news because it can temper the fed. stuart: the rate of growth is slowing down but that doesn't mean to say we slowed to zero and had to recession.
11:32 am
>> my point of view is we are coming through. where growth is slowing moderating. we don't envision a recession for 29 team. we just don't see the imbalances and accesses that normally mark the end of the business cycle. stuart: thank you indeed, sir. we've got mike murphy on the phone with us now. several folks on the show have suggested this selloff 1500 points down in a day and a half is overdone. what say you. >> i'm with them, stuart. could it be with you. this is an overreaction. we had a nice rally on monday based on the meeting on the g20. and now you have more selling coming into the market now. i don't see anything out there. i don't see anything out there for a recession.
11:33 am
selling to me a lot of this is algorithmic selling that is going to selling begets more selling. sometimes what fewer should be looking for is quality names that are trading at a discount to read they were six weeks ago and they should be looking at the home. stuart: do you think will reach a point fairly soon whether selling is so extreme that people like you jump in and say, here's the bargains. i'm buying. very close to that point? >> i do. when you talk about the capitulation, i think were in a different time now where was that is referring to is back in the day when you would finally have enough coming floss too much and you throw your hands up. a lot of what we see in the market is driven by computers. i'm not looking for capitulation bottom.
11:34 am
when parents get out of the headlines, when trade wars and technology executives from china get out of the headlines, the programs will start buying again in the market will be back up. if you can block out the headlines and look for quality. stuart: thank you for joining us. we'll see you again real soon. dan hemminger, hard g i believe. "wall street journal" editorial kind of guy. welcome to the show. i walked in this morning and was surprised to see that a chinese technology executives had been arrested in canada. arrested on the same day the dinner was held between xi jinping and donald trump in argentina. are the two connected? >> they are there than people there is some connection here. i find it striking. i'm not going to disagree with his market analysis, we should
11:35 am
not underestimate the significance of this arrest. that arrest was not ordered by robert lighthizer. this is chinese filtration under telecom system. to join us in pushing back huawei. what they are saying here is the chinese are posing a significant threat to our cybersecurity. for them to do this at the same time that were trying to negotiate a trade deal, to me is then sending a signal to xi jinping, we are very serious about the issues we are putting on the table related to the way you are conducting yourself in the world. not merely in trade relations, but areas of national security as well. i think this has taken it to much higher level than we were out last week. stuart: at the confrontation between the two powers here, which is not just about trade. it's a military diplomatic
11:36 am
technological confrontation at the same time. can you get a settlement to something i'm not ghetto? >> if they sit down and talk about it, they're trying to force the chinese to come to the table. we don't know what the trump administration wants for us exactly and indeed there asks on trade has been a little bit vague. now with the arrest of the daughter of the founder of huawei, they're making it clear we want to talk about your behavior in the national security realm and in trade and i would be the beginning of a negotiation. have a very serious talk and not try to kick this can down the road past 90 days. stuart: to go the other way very easily. if china wanted to arrest as a tit-for-tat move, all bets are off. stuart: i would say so. i would doubt they would do that. china is a serious country. they know they have problems,
11:37 am
but the trump side is trying to force them to sit down and have a serious substantive discussion about their future and arresting the daughter, the founder of huawei has gone a long way towards achieving that. stuart: mike if i could just get back here and maybe i'm covering the same ground twice. this extreme market reaction, do you think it's a little overdone bearing in mind what's going on with the rest of the chinese exec. >> i completely agree with what dan just said. we keep focusing on these trade imbalances. the four things highlighted were as follows. this is not just about trade. it's about commerce. the first issue here is about the forced transfer of intellectual property. the second is the issue of licensing restrictions on u.s. these companies are all foreign companies operating in china. the third of course was the substitution, but the last one is the issue of cybersecurity and espionage.
11:38 am
the issue is of course these are the four things the administration now looking to put more pressure on because these are critical issues for protect in the intellectual property, protecting the u.s.-based corporations. stuart: i want to bring in lives and ashley on the market in particular. we are down 670. a modest comeback i guess you would say. ashley: looking at the embassies, europe is given a hand as well. a two-year low. ten-year treasury now down to two-point a4 as more and more as a safe haven. stuart: you are saying that the flight to safety. that is why treasury yields are down as opposed to future weakness in the economy. ashley: the fear that economic growth is slowing down. train for global growth is slowing down. you know, this huawei stories
11:39 am
bigger than we realize. from its 5g networks, new zealand has stepped in. the telecom they're also kicked out huawei from its core group. 5g will be used in the internet of things, of health devices we wear on her. still huawei a stake in china is trying to do surveillance. that is the threat under this story. that is why these countries are react to them. it's out of the blue what is going on with the executive been arrested. stuart: thank you very much, lives. important stuff. the dow was down 680 points. not the low of the day we were down over 700. that is 750. we will be back with more about the selloff. ness means they won't hike your rates over one mistake. see, liberty mutual doesn't hold grudges.
11:40 am
for drivers with accident forgiveness, liberty mutual won't raise their rates because of their first accident. ♪ liberty. liberty. liberty. liberty. ♪ our new, hot, fresh breakfast will get you the readiest. holiday inn express. book now for at least 20% off during our annual sale. and all through the house 'twas the night before christmas not a creature was stirring, but everywhere else...
11:41 am
there are stores open late for shopping and fun as people seek gifts or even give some. not necessarily wrapped with paper and bows, but gifts of kind deeds, hard work and cold toes. there's magic in the air, on this day, at this time. the world's very much alive at 11:59. stuart: i'm doing the math and we are now down 1500 points just on tuesday and a half day trading so far today. that is the selloff. ashley, is it possible that ranks it is a negative for us? ashley: yes come in the chaos ensued as it appeared to reason they had to put on her deal. discloses near-term risk of the u.s. financial system also undermining confidence in your
11:42 am
zone fiscal and financial prospects. so yes, it is waiting on top of everything else. stuart: yes, the vote is next tuesday. if it goes down you could crash out of europe. liz: i agree. the dow was up. stuart: that's what you got, the selloff. will be back.
11:43 am
11:44 am
stuart: with the market down 600 points, the dow industrials, jonathan hoenig joins us on the phone. jonathan, the factors in play today appear to be the economy, worries about recession. the trade spat with china, do you think that maybe the selloff was overdone? >> you know, there's an old saying that a stock is never too low to sell. overdone i don't think it's necessarily where we are. the fact that every major u.s. indexes now below its 50 day moving average. just a technical indicator to demonstrate the trend for now is down. only three of those indicators are oversold. we are not seeing a lot of indication of oversold just yet. the market was tricked out. you saw this major sugar rushes below. a lot of optimism built around the president to eat and promises of a resolution and now
11:45 am
today all of those gains now given up and more. very briefly how the banks are doing. citigroup, bank of america, morgan stanley, goldman sachs, 52 week lows. they are bringing the market down financials, big insurance companies and it's very hard for a market to get it. stuart: kudos to you, jonathan because you turned negative some weeks ago before a lot of other people did. now is we've still got further to go down. is that accurate? >> that is the case. a couple weeks ago we were really worried about the technologies in the way now. the carnage is so wide bread. we are talking a lot about how magistrates have been coming
11:46 am
down. when people get scared they buy those government bonds. what the are selling our high yield wrongs. so if we are looking for potential trouble spot in the next couple weeks as we sort this out, that just might be it. stuart: jonathan hoenig, always appreciated. we are going to run through the stocks that are really taking it on the chin. i will start with the attack on the screen right now. facebook at 135. lots more negative publicity for facebook down 1.5%. not as big a drop is your seed in the other majorly companies. apple for example down $5 to play an 8%. i've got a report that the company in taiwan which makes camera lenses for the iphone have seen their orders drop 25%. that doesn't go down well in apple stock is down to 171. google down about 1%. that is $10.
11:47 am
it had been one of the better performers a big text. it is now down 2% 106 on microsoft. other stocks as we go through the list here because i'm sure it home you are holders of stock from especially the big names. can you show me the biggest losers on the dow, and maybe the biggest losers on the s&p. can you show me some sectors? these are stocks in the dow 30 in the dow jones industrial average. look at them go down. going up 6%, $20 down. they've got problems with the air crash in indonesia in dairy trade sensitive stock. that is why they are down so much. pfizer down 2%. merck down 2%. travelers dow stock down 3%. caterpillar trade sensitive data to%. right now i should tell you we've come back to the tune of 100 points in a matter of a few minutes. we are down 621, down 618
11:48 am
points. we were down well over 700. by the way, bowing as we showed you their is a dow stock sharply lower. that accounts for more than 120 points off the dow industrials. if it wasn't for boeing, the dow will be down just 500 points. that is still a selloff and a half, in it? we will be o back. then went beyond. beyond clumsy dials-in's and pins. to one-touch conference calls. beyond traditional tv. to tv on any device. beyond low-res surveillance video. to crystal clear hd video monitoring from anywhere. gig-fueled apps that exceed expectations. comcast business. beyond fast.
11:49 am
11:50 am
unstopand it's strengthenedting place, the by xfi pods,gateway. which plug in to extend the wifi even farther, past anything that stands in its way. ...well almost anything. leave no room behind with xfi pods. simple. easy. awesome. click or visit a retail store today.
11:51 am
11:52 am
stuart: we are still looking at a major selloff. the guy was down 600 points in every single one of the dow 30 are in the red. scott shellady joins us on the phone. i have a british related question. is it possible that brags it coming though coming up on tuesday likely to go down to defeat, is that a factor in our market selloff over here? >> maybe just a little bit. something folks would like to have an excuse for. traders told me this a long time ago. we have moved to where we can hurt the most people in the fastest time in this market because of complacency. yes, we are going to get rate hikes this year and achieved oil at 80 to $100 a barrel.
11:53 am
everyone got on that side of the vote and they have been punished. in doing so that's forced other people to get out of the market as well and i think this is all what this is. those people talk about recession. i don't know what they're getting that from. the numbers have been looking pretty good to me. stuart: we hear you. thanks for your input. not such a big factor in this market. we are now down 580 points yet it is a selloff. give me some perspective. transfer we are down 8% since the october 3rd high. the perspective is this. in nominal terms, the number of points down feels big. though we have had corrections historically every 1.8 years. in other words, the downturn of 10%. it is a normal market behaves this way. what is abnormal is a complacent lack of volatility, zero volatility last year. the trading action with the
11:54 am
dramatic v-shaped hockey stick plunges on a spike up when the human traders come in to buy him a tip. ashley: we do have christine macarthur matter what you think about her predictions that the imf says she thinks that global growth is going to be that bad next year. i don't know how much of a standard that is. that is more positive. we have seen the market come off of those extreme lows a little. maybe that's playing into a debate. stuart: more perspective here. when we walked in our studios this morning, the news that hit us was the arrest of senior executive with huawei. a huge chinese technology companies. they make cell phones and smartphones. this lady was arrested on december 1st. that is the same day as a dinner meeting between xi jinping of china and president trump. this theory is market selloff is partly based on the idea that president trump was sending a message to china. a hardline message.
11:55 am
don't let the sauce. don't mess around with our technology or your own technology is spying on us. a hardline message. that's the way it was taken by the marketing that would have the selloff of about 600 points. the other issue is the fate of the economy in the future. you keep hearing this call for a recession. the key. analysts say when you've got short-term interest rates here in long-term interest rates here. that is called an inverted yield curve. please don't bug me that that's what they're talking about and that is a signal of a recession down the road. >> they call it the death cross. the 50 day moving average. it's all gobbledygook. this is what they pick up on. when these helmets are realized. stuart: scott shelby in london on the phone with us are these
11:56 am
algorithms partly responsible for the selloff? >> they are largely responsible finally. we've been talking about capitulation for a while now. the huawei executive been arrested. resize selloff here in europe would not have been number one. number two, we have the market interruption at the cme in chicago with features overnight to calm things down. those are the types when you start to see this capitulation rollover. but so were slowly starting to get 94. this is where we start to decouple. that is the world were in right now. liz: we've been talking about the large liquid exchange traded funds. when they kick in common that seemed to break down below moving averages. but then come and human traders
11:57 am
come in and pick up the action. they don't know when or where to buy the capitulation bottom. that's the question. stuart: what a day. now we are down 600 we will be back. . .
11:58 am
11:59 am
stuart: the price of oil has gone back to, the market is is still selling off, down 600 points. the price of oil at $50 per barrel. 50.94 to be precise. the news that opec meeting has ended. there has been no statement from opec about how much oil production they are going to cut. that's why you're down nearly 4% on the dow industrials. liz though, offered us some perspective from the october 3rd high to now on the stock market we're only down 8%. liz: we're usually down eight, 10% every 1.8 years in the market. you should expect downturns every now and then. stuart: they are hard to take. liz: this is true. stuart: it has been a remarkable
12:00 pm
day. the news of the arrest of a chinese high level technology company. the suggestion that maybe the economy is really slowing down. it is all hurting the market, down 600 as we speak. time's up for me. david asman in for neil. >> business did i say indeed. welcome to coast to coast. i'm david asman in for neil cavuto if huawei is the tip of the iceberg is there a lot more surfacing? >> david, good to see you. when you look deep into this, there is a battle going on here. i thihe


info Stream Only

Uploaded by TV Archive on