tv Cavuto Coast to Coast FOX Business December 31, 2018 12:00pm-2:00pm EST
charles: that is ready for the new year. david asman. is in. >> welcome to "cavuto: coast to coast." i'm david asman filling in for neil cavuto. there is a long way away. there is thailand, wow. they are also doing the same in. >> cart tax indonesia. -- jakarta, indonesia. they're in the same time sown
markets care about a china deal than they care about government shut down, right? >> here is what we know. president trump had a good call with president she saturday night. they said they have positive revelations occurring. so far china agreed to buy more from the u.s. in terms of soybeans and rice. secretary steve mnuchin saying $1.2 trillion more which will help narrow our deficit with china. and i think they're going to hammer down some of the intellectual property theft details. hopefully that is at the heart of the issue. so that is what we really need more details. david: i don't want to down play 148 point gain on the dow, on saturday when president trump was tweeting this out, we heard good things from china, things would really pop on new year's
eve. we would see another 1000 point rally. we're a long way from that. >> there is progress. there are talks happening. regardless what happens you have to position yourself and your portfolio to hedge off the volatility, to diversify and rebalance in the process. if you need a stick, i'm ready to help you. david: how do you, i will stick with you for a minute. how do you rebalance it? what would you rebalance it with? >> absolutely. let's talk about baby bonds, preferred securities. this is an instrument that allows you to get more income, especially if you're 50 and older, like you, david, if you're older, you need income right away, it is a great diversification tool. they are usually $25 a share. they allow you to get income into the portfolio. sometimes they actually grow in price. usually don't, so don't hold me to that. david: i won't hold you to the fact that i'm over 50. i didn't admit that yet. >> you don't look it.
david: but you caught me. i got to tell you. heather, we heard from ken fisher over the weekend. he suggested 2019 might see a pop of stocks from 15 to 20%. do you believe that is possible? >> wow. david: that is what ken says. >> i think we'll see single-digit advance in the dow. that is possible. all eyes are on if we get positive chinese trade deal worked out by march 1st. remember the march 1st deadline, is the 90 day window with the meeting at the g20 in buenos aires. i think the markets will continue higher. the problem then, the fed might be back into play, right? if the markets continue highers because of their dual mandate is fulfilled. i will not make extreme call. i'm always optimistic of 15 to 20% next year. i think you will see single-digit advance in the dow. david: achilles, i don't want to be too optimistic, but on the
other hand i think the message got through to the fed. i know the president was like a big sledgehammer, rather than a scalpel about rate hikes. i think the message got through. i don't think we'll see a lot of rate hikes in 2019 if any, do you? >> the fed has only certain amount in their arsenal to use going forward. they will be really selective and strategic how they're going to do that. david: do you think there will be at least one or two or is it possible there wouldn't be any? >> some are saying they will cut-rates potentially if we don't have a deal with china. yeah. david: holy cow. do you think that is possible? >> anything is possible. we have to see what happens going forward. once the china thing is resolved, like she said the fed will come in, that will come into play. that will be very interesting. david: very quick prediction from each of you. heather, you said single digits. how much do you think the market is up in 2019? >> you will pin me, david?
david: i am. >> can i say seven? david: you can say seven. >> historical average. david: what do you say? >> no way. be smart. be selective. be strategic and have a happy new year. david: heather, you're braver person than achilles. 7%, you gave us a number. we'll play the tape in a year. >> oh, gosh. >> have a great new year. david: will the new year bring a new rally? market watcher dennis gartman says 2019 could start with a pop but you don't think it will stay there if does right? >> i don't think it will stay there at all. i don't am not concerned about the fed funds. allow it balance sheet to roll off. fuel to grow a strong stock market has been reduced. we'll get a pop. the we'll be supportive. market was egregiously oversold. you are getting that but it will
not last for long. david: what i love, dennis, you put your money where your mouth is. you deal with your own cash. where are you putting your money now? >> i bought a little bit the other day. i bought a little bit in energy and own sand for fracking but it is not doing much. i bought one of the local banks around here we do business with because i like the banking business for a pop. on balance i have orders resting in the derivatives market to sell the next 200-point rally in the dow. that is really where my money shall be. i think rather than up year, i think we'll have 7 to 10% down year. david: really? >> won't be substantive. that is not that bad, really, given we're down 7 or 8% in the s&p this year. another 7% on the downside, 15% from the peak, that is not unhistoric decline in prices so. david: do you think the economy will go down as well? do you think we'll have a recession? >> i think we'll have very modest, very quiet, very normal recession.
we might have trouble getting two consecutive quarters of negative gdp growth. i think we'll have negative gdp growth. i think the first quarter will be quietly lower. nothing dramatic. won't have any excesses we had in 2005, 6, 7. only excess we have is student loans. something has to be done with that to accommodate the abundance of many of our millenials are carrying on their backs which keeps them from buying houses. we don't have enough excesses to give us egregiously recession. it will be very normal, inelegant recession. david: you're not a political guy, dennis. i'm sure you have your beliefs. >> yes. david: there was very mild recession when george h. bush tried to run for re-election. the recession was so mild it was time when we were out of the election it, prevented him from winning re-election. >> yeah. david: if what you say happens, we have a mild recession in 2019.
the effects of it are felt in 2020, that could prevent the president's re-election? >> it is possible. i doubt that we will extend a economic weakness as far as into 2020. i think it will be -- david: but will we feel it into 2020? very often the effects are sort of, you hear about them more after after it is actually over. >> the nbr, national bureau of economic research, they tell us whether we're in recession and what we're out. they don't tell us when we're in recession until we're in. they're extremely slow and bad about doing it. yes the effects are delayed. you end up seeing unemployment rate going up months after the economy reaches its low. one of the problems you have to accommodate yourself to, or get yourself accustomed to. one of the things that i have to do both as economist and trader look forward to certain things. david: right.
we have to look forward, instead of backwards. heather, i asked heather and achilles about this. ken fisher thinks it is conceivable we could have 15 to 20% in the markets which you say what? >> it is conceivable. it is possible. it is extremely highly improbable. i say utterly doubtful that we can incur. nothing dramatic odds are 15 to 20% increase, not going to happen. david: i like to believe ken is right and you're wrong but we'll see what happens a year from now. happy new year to you. >> you too, david. good to be on the show. david: don't miss "bulls & bears" today, 5:00 p.m. eastern. we're doing a deep dive on this market and what to expect in 2019. coming up, house democrats planning a thursday vote to end the shutdown but will that lead to an end of the impasse? after this, we'll bump out with new year's's celebrations in thailand and jakarta, indonesia.
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david: president trump unwaivering on the wall as fox learns house democrats are looking to vote on bills to reopen the government once they gain control of the house. blake burman is at the white house. happy new year. reporter: hi, david. we're starting to get the gameplan from democrats, when they take control of the house coming thursday. democrats will put forth a measure that would fund the government through the rest of the fiscal year, through september. except through the department of homeland security that would be funded through february 8th, to give them time to figure out the whole component of it. that would push the issue over to the senate which last year, or this year i guess earlier this month, rather, took up a measure very similar to that and passed it. however, this new legislation that would be put forth by the house would not include any new money for the border wall and that is sort of the crux or at least remains to be the issue here as this stalemate of this
government shut down continues. the president continued to today to push for money for the wall. he tweeted out following, saying quote, i'm in the oval office. democrats come back from vacation now, give us the votes necessary for border security, including the wall. you voted yes in 2006 and 2013. one more yes but with me in the office, i'll get it built and fast. over the weekend senator lindsey graham had lunch with president trump here at the white house and floated out a possibility as to how he think this is whole stalemate could be broken, which would be giving the president $5 billion for the border wall in exchange for protection for daca recipients and those who have temporary protected status. here was lindsey graham outside of the west wing just yesterday. >> i think that is within the realm of possibility. the president didn't commit but i think he is very open-minded. i know there are some democrats out there who would be willing to provide money for wall and
border security. if we could deal with the daca population and we hopefully can get serious discussions started, maybe as soon as next week. reporter: but, david, that is a much bigger deal, or at least the possibility of it, that went nowhere, something similar to it went nowhere earlier this year. reality in washington, democrats will control the house in three days time. they will try to put pressure on republicans and this white house, look, we passed something to keep the government opening. why are you not signing this bill, mr. president? it appears that will be the first stare-down of 2019. david: very interesting. reporter: send it back to you. happy new year to you. david: happy new year to you, my friend. to "real clear politics" cofounder tom bevin what happens. blake said we have been here before with daca. didn't work the last time we tried it. what makes you think it might work now? >> circumstances have changed a little bit and we are seeing you
know, definitely think he is right, that the pressure will get ratcheted up here next few days when democrats come back take back the house and pass this bill to open most of the government, at least parts that are currently shut down. i think trump might actually want -- trump turned down 25 billion for the daca dreamer deal earlier last year but i think he might want to take this deal if he can get it. seems only way out for him to get the amount of money he wants, not have to walk away getting less than that, which would be, that would be politically damaging to trump if he does not get funding he want the for the border wall. that has been a red line he has drawn. core campaign promise. he needs to deliver on it. david: on the other hand there is also pressure on democrats. one thing that changed the horrible shooting, the murder of that police officer in california and then the sheriff coming out right after the murder, putting the blame on border security laws,
particularly the ones they have in california, sanctuary laws and anti-i.c.e. laws that some people say including the sheriff himself actually was responsible, partly responsible for the murder of this officer and other people that puts a lot of pressure on democrats to get a deal, doesn't it? >> it does. i mean, look, it moves things on the margin. these are obviously tragic stories. but it doesn't change the underlying sort of fundamentals of this debate where the public is on this. and the bottom line is, trump is now trying to say look, i'm negotiating in good faith and democrats are not negotiating at all. he is trying to turn that around, to make the democrats come to the table. whether he is able to do that next few days remains to be seen. public doesn't want the government shut down. they want it to be open. they're blaming trump. if the democrats don't come to the table without any offer whatsoever, the public may turn and hold democrats responsible. that is certainly what trump hopes happening. david: nothing concentrates the
mind of voters, of a police officer, particularly the illegal alien got here as a result of lax border security. that is what people are saying. that might changes things. the other thing, ridiculous about this whole debate, $5 billion in the midst of trillions of dollars that politicians are spending inside the beltway. we agreed on agricultural bill, democrats and republicans agreed on this, $867 billion. a lot of pork in the bill a lot of corporate welfare stuff shouldn't be there, $5 billion that is what is shutting down the government? >> exactly. less than .1 of 1% what the government spends. it is minuscule amount. this is about politics and symbolism. this is about donald trump with one of his core promises he wants to deliver on. democrats now taking back the house of representatives, nancy pelosi this is their first showdown with trump. she wants to show the base of
the party that she is up to the task. and so, here we are deadlocked over this tiny little amount and you know, the whole government isn't shut down but parts of the government have shut down over it. to your point, this is rounding error, drop in the bucket what congress normally spends. that is where the politics is, where it will remain. david: it is so transparent. i saw democrats on the sunday news shows, claiming the deep concern for the deficit was causing them to hold the line on this $5 billion when we know they're spending like crazy. we saw liz warren who announced her exploration of a 2020 campaign, has so many more elements, so many more government bureaucracies she wants to create if she ever becomes president, that would add trillions to the deficit. kind of a hard sell for them to make. >> it is especially all the democrats will run for president, at least ones i'm aware of are embracing medicare for all, which is the cost of that is astronomical.
so there will be this will be a fight that will happen in 2016 over government spending. trump and republicans have not held the line on spending the way some republicans wanted them to, that could change the equation as well. david: tom bevin, great to see you, tom. happy new year to you. >> have a great one. david: thank you. what a comeback for microsoft. the top tech performer in the dow and it has dethroned apple as the richest company in the world. more on what is going to be happening with microsoft in the knew -- new year to come. 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.
♪ david: amazon and google announcing expansions to new york city but jeff flock reports they may be outlyers as more companies are moving out of these high-taxed states like new york and illinois. right, jeff. >> reporter: i know, david. you and i both live in high-taxed areas. david: unfortunately. reporter: new york city for you.
however there is some positives there, but, i'm on the indiana-illinois border. this is like the u.s. border. only people, thank god there is not a wall here. people are trying to get out of illinois, get into indiana where taxes are people. look at population shifts. the biggest losers of population over the course of the past year. in addition to the states driven by energy and low energy prices mostly high-taxed states like connecticut, hawaii, illinois. biggest loser in illinois. since 2010, a person leaves every 4.6 minutes from illinois. 313 people leave a day. that is like a plane flight out of illinois every day, people moving away. why is it? larkly it is about taxes. if you look at states, illinois, for example, has a new governor coming into office in two weeks.
he promised a progressive income tax will be implemented here. right now we have flat tax, one rate, no matter how much you make. soon it will be like the federal tax rate, if you make more money, you pay more money. states with a progressive tax rate lost 293,000 people. over the same period, state has have no income tax, they gained 339,000 people. increasingly, david, seems like people are willing to vote with their feet and leave states that charge a lot of tax and go to states where you get lower tax rate, get to do with your money what you like. david: particularly in a warmer climate. unfortunately if you go from illinois to indiana you don't get a warmer climate. reporter: i know. governor cuomo says people leave new york because of bad weather. man, there is a lot of places with bad weather, illinois, indiana, same weather. people are going to indiana.
david: great point. despite the warning signs, potential 2020 challengers on the left are pushing for even larger government which means more taxes of course. today, liz warren is the first big democrat to launch an exploratory committee for 2020. david macintosh be president of conservative group, club for growth. david, don't you love how people and companies vote with their feet? that is the great thing about america. every state is a different petri dish, experimental dish for what works and what doesn't? >> you're exactly right. states like texas, florida, tennessee, have not put in an income tax, they're booming and will continue to boom because the good economic policy. david: yet, you have liz warren, frankly i don't know of any fiscally-responsible democrat 2020 platform that has come out yet of all those people who said they might run, but you look at liz warren, she's got a universal income, which she is
in favor of. everybody gets money for just being alive i guess. you have socialized medicine. that alone will cost more than the entire federal budget. that means you have to get rid of everything except socialized medicine. then of course there is more regulatory things, telling private companies how they can construct their bored -- board of directors and stuff. that is pretty intrusive that means higher taxes, a lot of higher taxes, right? >> that's right, david. she and the whole field of the democratic party have moved far left. they have embraced socialist programs. you look at medicare for all, universal health care. that is $32 trillion over 10 years. as you pointed out, 3.2 trillion a year is more than the rest of the budget. and they're not willing to make the hard choices. they say they will raise taxes but only on the rich. well, if you took 100% of the rich's money, you still wouldn't
be able to pay for all of that. so it is a program that will lead to economic disaster. i think as the election gets closer, and it become as binary choice between donald trump and a good economy and elizabeth warren or any one of these really socialist democrats, america is going to choose the free market and the economic growth. david: on other hand, david, giving current events their due if we go into recession, or a slowdown, short after recession, and market continues to fall, we get a negative figure on the growth rate, at least for one quarter next year, that could prevent president trump's re-election. that alone could prevent it. all of the accounting that that you and i know doesn't make sense from some of these democratic platforms won't matter. people might still vote for the democratic alternative to trump? >> i think you're right, david. the economy is usually the number one determinant in a presidential race. and so all the more important
that the president focuses on economic growth. he has got some tools in his, tool shed that can work. he can relieve some pressure of tariffs that he put on steel and aluminum but still as you know a lot depends what happens at the federal reserve and things beyond his control. david: he is still in control of federal agencies, or at least under the executive branch, there are hundreds of billions of dollars, that he has control over in managing. he now has as his chief of staff, mick vain any, guy who was head of omb. he understands exactly how the budget works. you think whoever the next year-and-a-half you will see a major effort to tighten up these agencies and cut back? we know, for example, medicare alone wastes 10% in waste and fraud every year. that is $80 billion just in medicare that could be cut out? >> i think you will see the agencies led by mick mulvaney
and the white house try to trim back that the problem both parties in congress are terrible when it comes to spending. they say let's spend more. doesn't matter if we add to the debt. frankly republicans haven't been any better than democrats on that score. david: that's true. >> so i'm not toop optimistic we will see any real relief own the weastful spending coming out of congress. david: nevertheless, a happy new year to you, david. >> you too, david. david: thanks have being here. we appreciate it. oil is well off the recent highs, set for the first annual decline actually since 2015. look at it, $45.38 a barrel. more to come right here. and every time we move, things change. apartments become houses, cars become mini vans. as we upgrade and downsize,
year-to-date off 7.7%. weakness reflects poor performance of the new high-priced iphones launched in september. remember those? citi cutting production by 48% for the iphone 10 xs. older iphones in china, that they infringed on the two patents by qualcomm. home depot, suffering as higher interest rates and higher prices dragged down home sells. usually home renovation is safe haven when housing market is weak, but not this time. unseasonably cool weather at beginning of the year also hurt sales. facebook down close to 25%. the first down year since 20 self. ranked as least-trusted social media network. internal emails that the company
routinely shared personal data with some advertisers. after ceo mark zuckerberg promised in congressional testimony to better safeguard user data. big tech, with that, managed to finish higher for the year, inmicrosoft, netflix amazon. there are some winners. david: making me depressed with all the losers, gerri. hopefully we have better year in 2019. >> next year is a new year. david: absolutely. tomorrow it begins. thank you, gerri. nasdaq close to end the year in a bear market. can tech companies innovate themselves out of all of this? brandywine portfolio manager jack mcintyre. good to see you, jack. when i look at all the stocks, particularly facebook, let's face it they're kind of the poster boy what has gone wrong with tech, specifically mistrust by their users that their personal data will be in misused in some way. that usually ends up or presumably will end up in some kind of regulation or perhaps even new laws to protect users.
is that the biggest danger going into 2019, that that could suck a lot of the profits out of these companies? >> so it is a, it is a key danger. there are several key dangers out there. one is, that hey, the global economy is slowing down. i don't think the consumer has a lot of pent-up demand. you can see iphone sales are not doing all that well. you look at the corporate sector, we've seen a pullback of cap-ex because all of the uncertainty over the trade tensions between the u.s. and china. so, u.s. economy is slowing down. i don't think at least the first part of next year will be a great environment for tech. i'm not sure they can really innovate their way out of the doldrums right now. we need to see, sort of macro backdrop improve before money starts going back into tech stocks. david: of course the thing about tech that makes it fascinating you can't always foresee what is coming. very often these innovations
come out of seemingly nowhere where even the experts didn't see it coming. we do know tremendous advances of 5g. 100 times faster and carries 100 times for information than 5g. technologies might help solve the privacy issues. you may have new technologies coming online in 2019 that could help tech, right? >> no, i agree and that is the reason you want to be in tech for the long haul. being in, taking sort of a broad diversified portfolio of tech stocks, because i think it will be very difficult to pick the winners. the point you made, you don't know technology is involving you don't know who the survivors will be over the next 10 years but it takes --
david: i'm behind the president of stopping china from stealing our technology. i think it is high time we did that on the other hand, i'm aware of without cross-cultural exchanges of technology we don't come up with great innovation you would otherwise. you sometimes have to share technology. do you think we'll find a way in sharing ideas and innovations and preventing people stealing what we have created? >> yeah. that is a tough one because you know, it looks like we are going into, already in a new economic cold war with china. do you want to share key technology with -- i don't want to call china a enemy but maybe a frenemy, given they're extremely competitive but along those lines, boy, to see tech do well you need to see trade tensions and the u.s. and china subside. they're moving in the right direction. they're talking and that is
always a good thing. one of the things we need to see is actions if we're really going to see broader equity markets recover and tech specifically. david: very tough needle to thread. hopefully they do it in 2019. jack mcintyre, great to see you, my friend. all prosperity to you in the new year. another big question mark is housing. fears that rising housing rates could go forward. to managing director jason meister whether the fears are warranted. jason is also a member of president trump's 2020 advisory board. let me start off where i finished off with jack. do you think there will be some way to prevent china doing what they have been doing for decades, stealing our best and brightest inventions but at the same time reopening some of what's closed down in trade with them? >> i think that we have a president that is a deal-maker. i think he knows how to negotiate deals and he's done it with mexico and canada. i think he will do it with
china. i think we need to give him some time to be able renegotiate, reset the table to make better trade deals. david: he has to negotiate also with the federal reserve board and apparently there will be a meeting coming up sometime over the next days or weeks with jerome powell, the head of the fed. they have been having this spat. but it is my belief this is my belief. this is the way he negotiates. he hits hard and pulls back and negotiates. >> sure. david: look at north korea, some of that we've seen internationally we're seeing with the federal reserve, do you agree? >> i agree. he takes a position. he sort of comes off the position. but he comes out powerful and strong. that is what we need right now. i think we've had terrible trade deals for decades and with regard to the fed, i mean the best report card for a how a president handles an economy is raising interest rates. under obama, for seven years, we didn't touch, the fed didn't touch the rates. and under president trump, just
16 months there have been four moves. to me -- david: precisely what president trump is against. >> i'm just making the point that the economy is healthy enough for the fed to raise rates. they couldn't raise rates under obama. david: it is the president's position, he makes a lot of sense, looks at the world economy, look, this is no time right now to be raising rates because you have an economy kind of teetering, whether china, a lot of that has to do with our tariffs, but also you have problems in europe largely due to their own mismanagement of things like taxes and regulation so i'm just wondering how the president threads that needle with jerome powell when he meets him? >> i think it's a needle that has to be thread very carefully. david: i promise not to use that metaphor anymore. but go ahead. >> as i point out, you have unemployment at a 50-year low, you have wages on the rise, you have an unbelievable job market. that is why the fed is making their moves. so it's, it's a problem, that is
a good problem because if we were in a economy that wasn't doing well, the fed couldn't raise rates. david: but you're, kind of making the case powell to raise rates more because there is slippage in the economy. there is slippage in the growth rate. we have strong jobs market. a lot of investment is going on. look what happened with the market, we've had pretty dicey times past couple months. >> i would agree. i think the fed should be they have been more tepid. next year they will have two rises. they're coming off the original position. think that i is the right move. you're right, the economy, there are signs of weakness. we need to be careful of that. david: jason, good to see you. thanks very much for being here. happy new year to you. >> happy new year to you. david: a major malware attack hitting newspapers all over the country. how far-reaching was this and why was it done? more details coming up.
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protect themselves. first of all, what do you think was going on here? >> thanks for having me on. what is interesting about this one a number of different news organizations from los angeles to chicago, where they couldn't produce newspapers because of the malware dropped on to these systems and this is the type of malware known as ransomware, what is interesting, there was no demand for payments. this would indicate trying to destroy or hurt computer systems instead of making monetary gain we see from normal hackers. that is interesting what is going on. david: that is what stuck out to me. there wasn't any of this, usually after people's credit cards or other stuff they can make money off of. >> exactly. david: seems like this was a specific attack. newspapers, i'm an old newspaper guy, they're having enough trouble. they don't need this on top of all the other problems they have but looks like a specific attack against these organizations, right? >> what's interesting, if you look what happened recently with the marriott starwood breach, they had been breached for several years.
and none of that data was actually published or being sold on the underground market t came out a few weeks aft ward it was attributed to a china hack. a lot of types of attacks we see, there is no specific monetary gains are usually not attributed back to organized crime and most specifically in this specific attack against the newspapers the malicious software was identified and a known variance from north korea. i don't want to say it is from north korea but we don't have a lot of detail this type of malware is used before in the past. remnants of code was used in the sony breach where they destroyed sony's infrastructure during those movies. we're looking to see if it was nation states or involved and this is damaging to newspapers which generally lack a lot of security. david: you say they're looking. is that a combination of private efforts, companies themselves, and the federal government? >> that's right. usually what happens in these types of situation as third party company will go in conjunction with law enforcement
to identify where the attackers came from and who they were, looking at code similarities. can we attribute them back to specific nation state or organized crime unit or individual hackers, so we can prevent them in the future. that kicks off almost immediately when these breaches occur. david: moist of us don't work for newspapers. number of people who do is a dwindling minority. i wonder if this kind of attack can we expect to see it in other industries that might affect us? >> specifically, if it was north korea, there are usually two motives north koreans have. one is monetary gain. they play heavily trying to get as much money as possible for the regime. hacking bitcoin and other cryptocurrencies. trying tokes tort money -- david: that doesn't seem to be what is going on here? >> no. the second motive is usually politically charged where they can shut down areas where they show the regime in higher light or did a bad press release against north koreans or the
president, to retaliate in some way, shape or form. at least on the surface what appears to happen right now which is an interesting element we'll continue to look for. david: david, will we find out eventually who did isn't is it easy to trace the perp here? >> to attribution is really difficult to find individuals. we look for areas where they may slip up or code not shared between anybody else other than specific groups. i would say in most circumstances we can attribute it back to a specific group or nation-state or somebody hacking them. i think we'll get more information as the time comes along, but most cases it's a very difficult process, takes a lot of time and requires a lot of artifacts and electronic evidence to see what is actually occurring. david: best to the newspapers. they are having enough trouble. they don't need this on top of everything. david, thanks for being here. >> happy new year. david: meanwhile nypd beefing up times square security with high-powered drones.
to former nypd lieutenant, darren pour cher. >> thank you. david. david: using drones, particularly last week we had the incident at at the airport in england where somebody, somebody, i don't know that they would find out who did it, used an industrial drone to shut down the whole airport. will this be a problem? if the nypd are using drones, visitors might say, oh, god, this is the bad folks doing it? >> since 9/11, counterterrorism measures have stepped up tremendous. we see symbiotic relationship in tech between law enforcement and these tech companies. that being said, users of drones send to be more innovative means or solution to police large crowds. they gather information. david: as good as they could be i can imagine being a visitor to new york city, not knowing how the city works, it is a crazy city for newcomers, looking up
to see drones, seeing drones and say, oh, my god, this is an attack? >> they may feel that way. this is the wave of the future. in addition we 1200 security cameras that are focused on revelers in the times square area. this is the direction we're going in with police. fortunately counterterrorism measures are the something the nypd is shouldering, if you want peace, prepare for war and this is an antidote moving forward. david: some of the more old-fashioned methods are on view in new york city. as i was coming to work, there were big dump trucks blocking street entrance. >> sanitation trucks. david: sanitation other trucks. some of these streets are just deserted. new york city has it together. i've seen other events in miami and chicago, this is the experience from 9/11, got us in
tune what needs to be done? >> that's right. new york city, i want to say particularly the nypd is at the forefront of counterterrorism measures. when we have the u.n. general assembly, different instances that occur, such as events, something nypd uses to train for days like today on new year's eve. granted we don't have any particular threats but we want to maintain level of cautiousness that vigilance will keep new yorkers safe. david: how much of that vigilance is transferable to other cities that may have a difficult infrastructure than we do here in new york? >> not just other cities but to other nations. look for the nypd for suggestions to implement, an effective counterterrorism strategy. the police, their populations. it is safe to say that the new york city police department is at the forefront of this. believe it or not the nypd travels abroad to other nations
to extract information that is pertinent to keeping new yorkers safe. the truth of the matter, it's a give-and-take relationship. it is making us better moving forward. david: you see more terrorist incidents abroad. i wish them well. i don't wish them any ill at all, but appears something we do that they don't do because you see more attacks, whether it is in belgium or france or wherever. what are we doing that they're not doing? >> we're staying abreast of the cutting-edge technologies in policing and that's what is ultimately keeping us safe. i was just in the middle east last week. amazing how i see the difference what they're doing and what we're doing here. we're not using rudimentary tactics but at same token we're using what is necessary to keep us in a better place. the landscape of terrorism is changing. we need to be fit for a challenge. david: want to see how it does, go to israel. new york is the best in the united states, no question about that, israel, when you see how
they do it, amazing how many terrorist attacks they have prevented there. >> el al air has never had a terrorist attack as a result of what you're saying. david: lieutenant, thank you for being here. >> happy new year. david: happy new year, don't be a stranger. don't forget to catch tonight's interview with president donald trump on fox news channel's all american news year special, interview with president trump, 10:00 here on fox. david: is there a sign that we're headed for a slow down? we hash that out coming up next
david: welcome back to cavuto coast to coast. i'm david asman could investors with major optimism over trade or this is president trump signaled over the weekend progress is being made on a deal with china. edward lorenz has the very latest. reporter: david, happy new year's eve. the treasury secretary said u.s. and china are headed for a face-to-face talk in early january. the tone definitely change from the chinese side over the past few weeks in a new year's eve address today chinese president xi jinping says the pace of china's reform will continue and will open china's doors wider to the outside world although he did not specifically mention the united states. a spokesperson for the chinese foreign ministry says china stands ready to work with the u.s. to implement the important
census reached by president xi jinping and president trump in argentina. the spokesperson goes on to say they will and cooperation. after the phone call over the weekend president trump and president xi commend u.s. wants china to stop stealing technology companies. also open market access. so far china has pushed back and some experts believe waiting for the tariff outcry from within the u.s. by farmers with soybeans and other products never came in our economy strengthened. so here we are with a march march 1st deadline for terrorists to be increased on $200 billion of chinese goods from 10% to 25% and the chinese wanting to talk. david: edward, thank you for it much. chinese manufacturing hitting a two-year low. to market watcher gary kaltbaum on whether or not this forces them to make a deal. they were saying the right things over the weekend. president trump tweedy now
things are going well. china saying pretty much the same thing. what do you think? >> all evidence and they're not moving very quickly. you know, china came out three days ago and everything, output, export, investment down year-over-year, quarter over quarter. china is kind of politically savvy. i think they see the president who lost the house has a bunch of investigations also going on, have a lot of things going on. so i think they're pretty much taking their time for whatever reason i don't know. sure into on the other hand, all pushed back kerry because there is a terrific report written of all places "the new york times," which is no friend of donald trump. he was saying in china there is a lot of opponents to president xi in the way he's been grabbing hold of power or supporting the president trump is doing because this makes it more likely that xi will be shaken enough to make
a deal. >> popularity has gone down and people are not happy at this point in time because of what's happening economically. so i get that. there's two sides to everything and still not much has gotten done. i hope something gets done. my little worry also the fact that the president keeps tweeting out the good news almost dilutes if we get good news but we'll see. the other problem is i'm not so sure china is coming all the way. i've got a sneaking suspicion no one ago 25, 30, 40% didn't they take it or leave it and then the fighting starts. i think this will play out over months, not over weeks and it's still going to be a pain in the rear as we move forward. david: by the way come you said you have a little worry. i have to know personally you have kind of a big worry about what's happening with these markets even though we have a nice bum today of 200 points on the dow. you wouldn't trust this rally, would you? >> i think we're in a bear market rally.
the dow dropped 4216 points and 14 days and we are rallying back. i need to see more. we are getting in end of year, end of month window dressing. for me. it's going to be about january and also most importantly the reaction to earnings. if we get guidance on the way down that's going to be trouble son. i don't think their markets just last two or three months. they usually last six, nine month and have a couple legs down. by the way, i'm optimistic when an spirit will find some great leadership in great names when all this is over. david: the good thing about their markets or even corrections as it clears out a lot of the deadwood and that's a good thing for the economy. but you think this is more than just a correction, don't you? something a little more sinister going on. >> yeah, but like david, we have not had a real market in ages. we are overdue. there's nothing wrong with it. their markets tend to pop
bubbles. they get the bolts frowning and smiling and then we start going again. 100% guarantee since day one. when the bear market is over will have another glorious bull market. it will be led to great companies growing earnings 50%, 100% a year. and we will be off to the races again. it just takes time. it takes patience and too many people are still jumping the gun. david: i do love to push back with you because of her friends and we do that thing. this is a very business friendly environment we are in. democrats taking over the house and were not going to pass any more tax cuts, but were not increasing tax cut and regulations. and the fact i think got the message at least partly so. not going to be as anxious to raise rates. we still have a lot of business
friendly stuff happening out there. >> i'm not going to push back on you. i agree with you. no chance of raising rates anymore. but there are still some other things out there that we deal with it namely the debt and deficit that i do believe provide a headwind to even stronger economic growth than i do worry about the rest of the globe. when you have germany contract team, which is the engine of europe, i wonder about the rest of europe. japan contracted and that can affect us also. i think where the best of the lot. i worry we are not immune to the rest of the world. david: you know gary, you're so good can you come back to 5:00 for "bulls & bears"? >> i can't wait my friend. ready to bring in the new year with the great david asman. david: there's no reason to not come back to 5:00. we'll see you then. forget a slowdown in china. could we be on the verge of a slowdown right here. cutting its u.s. growth were cast for the first half of 2019.
kate stopped in on whether or not we could see a slowdown in the markets in 2019. i've been bringing this up all morning because i like ken fisher. he's a very smart guy. i like him a lot. he came out with a piece of "usa today" suggesting we could have a 15% to 20% increase in the stock market in 2019 going against a goldman sachs the same. what do you say? >> you really can't rule out anything, but if you look at the market the past couple months am i does seem to be anticipating some kind of slowdown. beverly doesn't seem -- a lot of break downs among the major industries and that does tighten risk as they go to q1 at the new year. it is concerning longer-term and we want to react to the intermediate term danger sidetrack is a technical analyst. things like momentum.
david: let's get to that. is it just a matter that the market were overbought, that we were all too optimistic? is that why markets are correcting now or is there something more fundamental about what gary was suggesting and that might affect their gdp. >> well, from my perspective the corrective phase is largely driven by barca sentiment. it got very overly greedy or overexuberant pearsall august into september. usually that occurs at the leadtime to correct their face and that's indeed what we saw. but the biggest risk to the market. we saw the market stake in the mud in october and retest and ultimately failed and we need to be respectful of that, listen to the market, and let it tell us how to position. david: it's good that you have a year for the market.
it seems that greed has turned into fear in the market, doesn't it? >> it definitely has the nets made the pendulum swing from extreme greed to now extreme fear in the market base and that can be healthy and it does support the relief rally already underway in my opinion. i do expect near-term for the major indices have 5500 for one and a good deal of upside even with the moving average. it creates a little bit of a vacuum to the upside in the near term and should allow us a better selling opportunity of the stocks that have also broken down. david: let's leave in a positive note. happy new year to you, katie. >> happy new year. david: democrats to advance legislation on thursday to reopen the government. proposal would fund dhs until february 8th another closed agencies through september september 30th. don't miss our end of year wrapup on the markets on "bulls & bears" at 5:00 p.m. eastern. as i told you, a lot of folks.
there will be a lot of fun. please join us tonight live at 5:00 p.m. most kids today will have jobs that don't exist yet. the engine management systems coordinate with autonomous vehicles. financial data, so now we can predict the future. our new flexible propeller design. by collaborating with public schools on a program called p-tech, ibm is helping students build the skills they'll need for tomorrow. revolutionizing. aerospace industry. it's an entirely sustainable approach. any questions? when you rethink education, everyone can put smart to work.
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come from 18,600 up to 23,283. still pretty good. this is from this time one year ago today. we are down almost 6% across-the-board except for nasdaq which is down a little less so. big hits on all the indexes. the day before 2019, 2020 begins. elizabeth warren the first major democrat to launch an exploratory presidential committee. senator warren for bigger government, is she going to be the phase of the democrat party. gop pollster john thomas, good to see you both. i watched this four-minute video and i was surprised there wasn't one word about donald trump in it. she was focusing on the issue. she was focusing on the economy. do you think there will stay that way or do you think you will get more personal? >> it's already begun. pretty crazy timing from elizabeth warren. i think she wanted to get an
early onset of the a national infrastructure and try to re-correct or sword of readership to the narrative that has been going around, swirling around specifically when it comes to her native american claims. she claimed to be native american. in a book called powwow child and of course donald trump put her in the national conversation regarding that issue. then of course he released a dna test. it didn't really work in her favor. i think she's trying to shift the narrative then come back and reestablish the pillar for the progressive left. david: john, maybe that's a bonus, maybe a minus because when you start adding up everything she wants in terms of big government policies from universal income, she's a proponent of that at least in one of the plans to medicare for all. she's talking about big bucks aired already $22 trillion in
debt. is that a weakness quarter? >> is certainly a weakness in the general election, but heart and soul doesn't care if they tax and spend us into oblivion. i think elizabeth warren's challenge here is let's just keep this in perspective. she essentially announced the exploratory committee that she's running for president on new year's eve. a terrible day. generally speaking in our political strategy you want to wait as long as you can to announce because the sooner you pop your head up, the sooner people start taking shots at you. the reality with elizabeth warren is a year ago she was number one in the polls. she's fallen so far down she's stuck in second and third tier candidates. she has to resurrect her campaign. david: let me ask what you said? why is that she slipped so far fast and if she has, why did she
announce early because john is right. it's usually the early comers the first ones to drop out. >> i want to push back a little bit. the last time i had a balanced budget was under a democratic president. david: republican congress you're right. when it comes to elizabeth warren, taking a lot of key supporters. naturally he is polling higher than she is in iowa. a poll has her behind bernie, behind beto and biden. behind another progressive to some degree sherrod brown. so there is a crowded field of progressives in the democratic party and the name recognition going back to the back to this you back to the few she have a trump, there's a lot of fatigue when it comes to the nicknames, when it comes to the gutter politics, when it comes to the pigs rolling around with you and you know it they roll around with.
more of that to come and there's a lot in that way. david: let's focus on the president's trouble with the current economic situation. the economy is strong but if it does low down significantly in 2019 and going into 2028, the president could not win in reelection. that's clear with what happened with george bush. he needs a strong economy is one of the pillars of his campaign. i do think it's stronger than the market would indicate now. does that increase the possibility of him before his reelection kicks into high gear making a deal with china. that alone could get the market cooking again. >> it was a gamble for him to do this. to deal with the political conflicts. if the economy roars back, but furthermore it depends on who
the democrats get through their primary process to nominate. someone like elizabeth warren or burn us -- bernie sanders that specifically say they want to raise taxes. trump now with the democratic congress has the villain. he is nancy pelosi. he can blame other people. trump certainly would degrade. david: thank you for coming in. happy new year to you. it's been a rough year for tech investors. will 2019 be any different? not to com. -- on that to come
junk on spirit fox news contributor phil flynn on where the safe havens are today. hi, phil. >> good morning, dave. an incredible year for gold. late in the year put on a rally but they had a lot of headwind. we had rising interest rates. we had people moving money out of the stock market into bonds. remember year ago everybody was looking for gold was one place people were bonding when they were looking for some type of return. the other was of course the high yield on funds, those junk bonds. we saw a major reversal here. for people over $60 billion pulled out of junk bond fund in the last month because no wonder were looking for yield, were looking for safety. dan goldin the new gear. even though we are closing down for the year, were making a nice run at the end of the year because were not going to see as many interest rate increases in
the new gear. a lot of turmoil in the marketplace. looking for something that is more solid, little less volatile. gold might be that place. the pullback is another interesting thing. that might be reflected with what we saw in the energy markets for example because a lot of those junk bonds are energy related about 15% to 20%. put it all together when we see these big moves at the end of the year it's what people's perception is about risk. right now the pullback from junk bonds is they're worried about credit and the end of the year is they're uncertain about the new year. generally when you get that kind of a pullback, look for reversal in the new year because as you know when you see these big moves, sometimes you're over react and both of these markets going into the new year. david: phil come i do have to ask you about oil. opec is trying desperately to force their members to go back to the point where prices would go just doesn't seem to work.
it seems like it's all about supply rather than demand. maybe the fact there is a worldwide slowdown in there just aren't enough people buying the stuff. >> i think it's more about perception than reality. we talk about the new opec cut. they actually haven't gone into effect yet. it remains to be seen how effect is they're going to be. you're right to u.s. producers are continuing to produce record pace, even with the pullback in investment going into the new year. they're still expected to have a million barrels of oil a day. at the end of the day, none of that matters because it really comes down to demand. i'll tell you this is the global economy is slowing as much as the market seems to be fearful of, we're undersupplied in the new year. we do have a slowdown you get as much oil. david: if we're undersupplied will see a pop in the oil price. >> we sure showed, dave.
i watch this market for a long time. a few months ago at $77 an hour at 40. david: interesting. phil flynn, thank you very much. appreciate it. global data set to top $250 trillion. our own federal debt is approaching 2 trillion yet no signs of slowdown. from the u.s. comptroller has been warning us about this time and again. give it great to see you. i remember you and i've been on 10 years ago warning about this happened. he suggested it would go up to current levels. at the same time we haven't seen the market reaction to these huge debt levels. when are we going to see that? >> only god knows in god is not telling us. we lost control again. we are at about $22 trillion in debt subject to the debt ceiling limit. that is four times what it was
in 2000. we've got debt to gdp as a percentage of the economy that's about the same level as it was at the end of world war ii and rising faster than the economic growth. we've lost control within the last year between the tax cuts and spending increases, the deficit for 2019 more than doubled. within five years were going to spend more in interest than we do on national security and within 10 years we could be spending a trillion dollars a year for interest in what you get for interest? nothing. david: by the way, you mentioned tax rate cuts. i would not include that because our tax revenue is at the highest level ever because yes we did have a drop in corporate tax income, but that's only 9% of the total. all of these people working is good for tax revenues and that is why we have record tax
revenues are the spending is the key. it's really no matter who's in power whether it's democrats or republicans they just can't continue to spend like this. >> word to did the spending, to deficits and debt. let's understand the measures. what really matters is not the total amount of debt. not the total on the spending and not with the actual deficit is. it's what they are is a percentage to the economy. the highest we ever taxed was in 2000, which was about 2125% of gdp. we are below that now. bending is out of control and yet you have certain people that want to have socialized medicine for everybody. they want to have guaranteed jobs for everybody. well, you know, we need to get back to reality. you can't spend more money than you make and not expect to have it day of reckoning at some point in time. david: the government of course doesn't create jobs.
it's the private sector that does. i'm just wondering if there's some way because these entitlements are what it's costing the most amount of money. medicare, social security, that array. politicians -- thus the third rail of politics. however there is something you can cut back there on and that is waste and fraud. there was an inspector general's report about five years ago that suggested that medicare waste 10% on waste and fraud and that would add up to $80 billion here to somebody gave serious about cracking down on waste and fraud, would that make a dent in the debt? >> you can, but it's not going to come close to solving our problem. things are so out of touch and out of control i think the time has come that we need a federal fiscal responsibility constitutional amendment. david: by the way, we used to call that a balanced budget amendment. basically the same thing. >> no, it's not the same thing. what i think we need to focus on
is how much debt as a percentage to the economy that we -- david: well, think we lost david, darn it. sometimes these things happen with satellite. david walker was the u.s. comptroller general and he will be back to cs. fears of a stock market collapse are they overblown? veteran market watcher on why he says the selling may be over. that's good news to com.
they changed their time by the half-hour they are and they were celebrating a very happy new year in new delhi. meanwhile, uber topping the list of ipos investors are eyeing in the new year. the company make in a big vat on self driving cars. tech analyst russ khristich, kristina partsinevelos and susan li are here with us. first of all, kind of a risky time market waste to be issuing an ipo. susan: you have to go because after early investors venture capital money had been in the company for 10 years, they want their money back at some point. if your competitor is also wanting to get the market before you, maybe up some of that investor dollar in the markets come you probably want to run ahead of them. but you should want investors, overvaluation of $70 billion it looks like the underwriters want to get to $100 billion or that's a silly company making losses. one by 5 billion each and every
month. david: and also kristina comeau woodcut dimensioned uber has a lot of baggage. a lot of cities around the world that have this relationship with taxi is why you can say lyft has some opportunity because they can gain more market share potentially damp uber. susan mentioned the strength of some of these ipos is the averages 10 years and he used to be about six white nine years before they actually went public. you do have companies going public and hopefully more mature and stable. the concerning point is a lot of them are moving it up. a few years are now they're going public in 2019. they are rushing to get ahead of the curve in case things get worse in the near term and tightening. how is that going to get any better in 2019. david: any chance that they feel it are rushing they can put it off a little longer?
>> i think that's the idea. they're trying to get the money while they can undo the growth while they can. this is a space that is 100% -- david: even in this market there is demand. playing a bigger game at this point they have their money locked in with travis kalanick for 10 years. at some point investors do want to cash out. >> to that point, what about the dual class structure that's been a bother for a lot of people. some could take to censor your not getting as much voting power as you would in the past. so that's a direct listing. i think my second day here or something i was at this bona fide direct listing. and maybe a more no -- no more about this than i do if they'll go the route of bypassing. >> not that valuation. >> not uber and lyft, but other ones like interest.
>> yeah, at that level they would probably. david: what appeals most when you look at the ipo ventures that happen in 2019. >> i do agree with self driving cars without a doubt. the concerning what will hit them is the element of how much competition not just of ipos doing this but from gm places that you wouldn't -- google certainly has been in there for years. the self driving space will have a wave of competition. although they have a jump on it because they've had his mrs. for a while i just don't know their essays. susan: at the ceo of uber -- that takes up a lot of money. $250 million each year. each quarter from what i hear will ramp up at that point and he's been asked about this and will review his structure. david: regulatory environments change.
they swung the pendulum and was buried over regulated. now it seems like there's a pendulum swing to more regulation. >> you feel like maybe that's geared towards the technology there. to that point it is going to be saved by some of these gm and ford the fact they've laid off employees with the goal of focusing on electric vehicles, driverless cards and who knows, didn't one other car companies go into car sharing? was that gm? >> i thought uber had a car sharing business in phoenix. >> they're all competing against each other at some point. >> who's going to win? >> i think google will win. they have the technology in the long game is not keeping taxi drivers in business. david: google will get into the
car. >> they just seem to have the technology that runs all of the cars. david: some companies, some tech companies are satisfied just being in the car. companies that focus on software. better they actually going to have a big assembly line? they're not actually going to get into it. >> they control how and where. >> googles way mel owns gm. david: what i love about this is the technology leads to more technology, more innovation. one innovation in the whole field of technology like self driving cars. who knows where that will spin out. >> the car can now be connected to everything around you the potentials are endless. imagine your mother house before coming home from your car and
turn off all the lights are for the air-conditioning on 20 minutes when you're driving home. these are all things you can do from your car. david: you won't even have to get out of bed. susan: it will be a banner year. air bmv going public. peter taylor basset of course. maybe looking at listings. david: peter dale knows what he's doing. today's going to be a banner day for fox business network because you two ladies -- i don't think we've ever had two ladies set up "after the bell." >> it's about time. i wish you could be on the 5:00 which is where i'll be. our year market recap is on bulls and bears today at 5:00 p.m. gary kaltbaum, a whole list of gas coming as well. you don't want to miss it. we'll have a lot of fun. it starts at 4:00. the dow was up over 200, just
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into this. reporter: you know, the president has few if any supporters on capitol hill that lindsey graham, but also earlier this month few if any more bigger critics as it relates to his decision to withdraw troops from syria, then lindsey graham. at one point the president's decision would he a boost for iss to get back into that country. he even said on twitter withdrawal of the small american force in the area would be a huge obama like ms. tate. however, over at the white house this weekend the president and graham had lunch in the senator from south carolina said many of his concerns had been addressed. >> we had a great lunch. we talked about syria and he told me some things i didn't know that made me feel a lot better about where we're headed in the area. he promised to destroy iss. he's going to keep that promise. we're not there yet.
but as i said today were inside the 10-yard line and the president understands the need to finish the job. david: the president continuing to defend his decision today in the series between, one of which i'm the only person in america say never integrate troops back with victory and get bad press. fake news and pundits who have failed for years that are doing the complaining. if i stayed in endless wars forever, they would still be unhappy. the president continues to say that he is living up to a campaign promise. david: he is. he did make it on the stump, but i'm glad the balance with lindsey graham and president trump, i like that balance. something about that that appeals to me. so how strong is isis stronghold? new york police beefing up security ahead of tonight's celebration. are we still at risk of terror attacks? commanding officer of the counterterrorist division mike
o'neill. first of all, for all of new yorkers say thank you because the work you do in counterterrorism new york city is the pinnacle. it's really the best in the world. we feel so much safer as a result of the works of thank you for that. so as we see isis not getting completely wiped out, the really critically injured by what we've done over the past year and a half inferior, if you don't have a base of operation, like isis used to have been syria come a really cuts the legs out from under their operation. david: when they have the caliphate and land control they were generating sophisticated propaganda, so it was a problem. david: have you seen it from the street level in new york, can you tell they have less influence on what's happening? >> the last five years there's been 56 cases of welder attempted tax on mainland united states. so if you when i'm not alone the propaganda was working.
their propaganda works. i think was important to destroy them. david: when the copycats, the wannabes jihadist that may cause terror and kill people and do damage in our country. when they see them having success overs these, that makes them more inclined to want to help. >> the art of war. the bigger recruitment till they get more people. david: nevertheless we can't let our guard down. what should the citizens as we begin to celebrate new year's eve, what should they be doing? what should they be on the lookout for? >> the n.y.p.d. does a great job of this every year. any countermeasures you see is the participants themselves to empower them with information. we want to come there but they're definitely our eyes and ears. they're most likely to see something to dishes before you're in office and let them know i'm not the n.y.p.d. do their job.
david: ices aside there's a lot of nuts out there. we've seen cases in las vegas and elsewhere were people we don't think were directly associated were involved in killing people that were gathered together in mass. so it's not just terrorism. are the techniques used against isis terrorists also helpful in crazies out there. >> special event security. i would call high consequence threat. whatever the ideology might be. active shooter, terrorism. but the practices are the same. we inform the public. engage on pacific behavior. god forbid something would happen. >> there are less that it's no longer a threat. people who went and filed with isis and other terror groups who come back to the united states and could be operating. have you a good guy on who these people are? >> the reality is particularly a
lot of european fighters there. we would hope they have a good idea and who those people are. i think it's unrealistic in which you might have is living with us in the west. though not give up the fight that easy. david: how about coming through the borders. the president and others have members of his administration say some of them are coming up through mexico. >> i believe we need to know who's coming in here. those european fighters if you think about it we have a visa waiver process with a lot of friendly european countries. they could easily hop a plane if we don't know who they are or be somewhere in europe as well. david: thanks for keeping us safe. we appreciate it. we will close off the year while in their highest or by one
. . ♪ this holiday season, families near you need your help. visit redcross.org now to donate. david: what a wild 2018 for stocks. that coming to a close amid fears of a u.s. slowdown but economic historian john steel gordon says the fears could be premature. great to see you new york stock exchange glad to be here. david: you don't think there will be a slow down as long as we come to some kind of a deal with china, right?
>> i agree. american fundamentals are quite strong. one thing, for companies can now bring their profits back home from overseas without paying additional tax on them. that make investment much cheaper. david: that is huge boon for them. we constantly hear from naysayers this is sugar high because of the tax cuts and everything, but once you pull the government back, not like the private sector needs continue all sugar. they know how to produce on their own. >> exactly. >> what exactly is all this slowdown stuff coming from? just fears of no deal with china? >> i think partly that. wishful thinking on part of those who would like to do injury to donald trump. mainstream media today, donald trump could cure cancer, and they would be complain about throwing oncologists out of work. david: donald trump in addition to being a successful
businessman here in the united states he dealt with international businesses. knows one reason the market is lousy this year, is concerns about trade. if he wants to win re-election, the economy has to be good. it won't be good unless there is some kind of conclusion with china. i think that is why there is going to be a deal. >> i think so too. the chinese would like a deal. david, they have tremendous economic problems of their own, far worse than we have. losing american trade is not going to help that. david: i have heard, in fact there was a piece in "the new york times" of all places, not a big fan of donald trump but a piece in the "times," nevertheless, saying a number of chinese who are concerned about mr. xi, about the president taking power to himself and they are looking forward to donald trump really putting the screws on xi in order to get him to loosen up the reins, not just to get a trade deal but also help them politically? >> i hope that is true.
people like president xi tend to always want more power. they don't give it up easily. david: there was, there was this belief by free traders if we were to trade like crazy with china, open up our doors to chinese goods like we have the past decades that china would become more democrat. in fact we loosened up the trading with china, and china has become more authoritarian, why do you think that is? >> china tend to be authoritarian in its long, long history. it tends to concentrate power in the emperor or mao tse-tung. they have no experience with democracy whatsoever. it takes a long time to learn to be democratic. david: does it surprise you, other countries that had been authoritarian, like chile, under general pinochet, when they develop ad freer economy, they
develop ad freer political system, why hasn't that happened in china? >> that is a food question. i'm not an expert on china, but china, their tradition is to concentrate power and so that is very hard to get away from that tradition. there have been other countries in the west who have become much more democratic like chile is a good example. only thing outside of the west i can think of is japan. that is bus the united states ran the joint for 10 years. david: same thing happened in germany. >> same thing in germany. david: they had a german economic renaissance, when we insisted they sign on to democratic measures. >> yes. david: let me bring you back home. you're an expert here. president trump wrote in 2017 could herald in a new political order. do you think that happened and what way? >> i think it is beginning to happen. i think the democratic party is in terrible shape, yes they have
took the house but they're in long term decline. they have no coherent political, economic philosophy. their philosophy is whatever is bad for trump and is good for us, and if it injures the country. they don't care. they are living in the past. everything is racist, race i when we have fewer conflicts in racism after we elected a black president 10 years ago. how can we be a racist country to do that? david: beyond that liz warren coming out with the same old stuff, spending more, taxing more. >> they have never seen a tax increase they didn't like or tax decrease they didn't hate. david: john steele gordon, always a pleasure to see you. >> thank you very much. david: we thank you all for watching. the market lost some of its steam. it is still up 178 points right now. it was up over a full percent moments ago. we'll follow it throughout the day here on fox news.
we wish you a very happy new year, everybody. i will be back at 5:00 p.m. eastern today with "bulls & bears" to recap this wild year in stocks. what we say is going to happen in 2019. here is the man who handed me this channel, about two hours ago, charles payne is back with us. charles. charles: new year's eve version of tag, i love it. david: thanks, charles. charles: good afternoon, everyone, i'm charles payne. this is "making money." coming up the market trying to end the final day of the year in a positive note. where you should be putting your money in 2019. pushing markets higher right now, new reports that the united states and china ironing out toward as framework of a trade deal. really great sound on both sides. president trump tweeting over the weekend he had a very good conversation with president she. decides trade, what are the potential risks to the economy and the new year. my experts way in