tv Varney Company FOX Business January 4, 2019 9:00am-12:00pm EST
great way to start the year. great first friday. here he is. now markets will just cooperate. thank you. thank you one and it has been like worst start since year 2,000 i think for the dow and s&p. ashley webster is in for stuart varney it is all yours. >> if only stew was here a jobs report to make him smile stuart by the way back on monday and here are the big stories we're following on this friday. ashley: futures pointing higher after that 660 point selloff two factors driving the markets today. a blowout jobs report 312,000 jobs added in the month of december average hourly wage is up 3.2% last year and by the way october and november's jobs numbers revised upward labor department says 58,000 more jobs created in two months by the way larry kudlow coming up later this hour to react to impressive numbers we also have progress on a trade deal we understand with
china. a u.s. trade delegation heading to china next week to hold two day of talks with their chinese counterpart that is good news for the market but at least they're talking right. check apple, not much of a bounceback this morning stock was down 10% yesterday. after it lowered its sales guidance fighting weak iphone sales in china now here's the question is this a buying opportunity at this level we're on it and ask experts. on to politics, nancy pelosi taking back the speaker gavel the new democrat controlled congress is in session. leaders from both parties by the way head to white house today at a 11:30 amy eastern more talks to try to end the shutdown both sides, though, dig in their heels over that funding for a border wall. big day for money, and politics we've got it all covered "varney & company" begins right now. ♪
well president trump just tweeting this this morning, and here it is. as i have stated in times by the way we are going to see larry kudlow as well. this is the trump i last stated many times the democrats take over the the house or senate there will be disruption to the financial markets we won the senate they won the house. things will setting down. they only want to impeach me because they know they can't win in 2020 too much success says the president in his tweet this morning. next, the price of gasoline -- up overnight that ends a decline that lasted 85 days emac is question is have gas prices bottomed out? >> they probably did gas analysts are saying expect a dollar rise in gas prices by march or -- historically that's what we have seen. you know people thought their eyes were playing tricks on them we see $2 a gallon i bet that's where varney is right now. setting up generators to his
car. a signing in arkansas, stuart varney no just kidding. so you know average $38 savings in gas pump looks great but they'll start trending up by about a buck by the spring that's what the forecast says. >> all coming to an end. 85 day straight. talking about not believing your eyeslet focus on the december jobs report joining us us now foxnews.com columnist liz peek, liz i did a double take or double kind of what had 312,000 jobs blowing out estimates of, you know, around 176,000 your reaction. >> yeah, with it is a great goz and i think we need it a little affirmation that our economy is still very vibrant very strong and by the way we have hingt this have adp number that came out earlier this week yesterday i guess was also much better than expected the nfib small business group that reports regularly on hiring and so forth they have been very bullish on hiring saying their members are
hiring at a faster rate than they have in decades so i think -- nonetheless even though we've had sort of that supporting evidence with with apple announcement with great concerns about what's going on in china it is god to remember we are not china we are with actually growing our fourth quarter gdp my guess is ratchet up on basis of this we'll see. >> any aspect other than headline that you liked in this report? >> i loved seeing unemployment rate go up. why is that? because there are more people coming into the work force. i've been writing about this for -- you know couple of years really. everyone has been so nervous about not -- unavailability of workers yes we have shortages in some key trades and so forth but the the truth is, so many people l were sitting on the sidelines over the last decade when wages were stagnant and benefits programs expanded to take care of for example single males, et cetera and now wages are going up wage number pretty good too up 3.2%
year over year some of the people are jumping off sidelines saying you know whatst there a job for me i want to go back to work. >> very impressive liz thank you. i want to come back to you on shutdown in a little bit. so don't go away. as we said with larry kudlow talks about this morning's jobs report i'm sure he'll be glowing about it and have him on in just a little while to your money now wild swings for the market who continued into the new year all unsettling for sure distressing for traitders. joinings now market watcher keith fitzgerald, with all right keith where do we go from here? we have -- we don't know where we're going minute to minute let alone session to session. [laughter] >> yeah, unfortunately we with need a ouija board or magic eight balls. fund mentally number is important because it signifies people going back to work but also it brings people off the sidelines because now they're interested in their future and miss sincing october people haven't been interested but
scares so to many this great number it reminds us that fundamental underpinning of the economy are good and companies are still growing some of the tech exception. >> let's fake a look at apple shares to that point shedding about 75 billion in market value last session alone in one day. remember, the company warned about weak iphone sales in china if you watch asia fors us. how big is apple's china problem? >> well you know on this surface it is a huge problem. if you're concerned about iphone sales but i don't see it that way. i again i believe that apple is making a fundamental pivot away from devices and if you look at why tim cook is doing what he's doing, i think they're going into medical technologies into information. and imagine where this company will be after selling stops after institutions rebalance and suddenly you have to have an apple because your doctor prescribes one. >> apple a day keeps doctor away i thought. would you buy apple at that price is it a buying opportunity?
>> it is. but you know what, i'm a little bit greedy in here i'm going to qaits until it is 1:20, 1.25 because institutions haven't done rebalancing that's 60, 80, 100 billion dollars. 120 that's not being greedy but being smart. back to government shutdown president trump meeting with congressional leadership around 11:30 eastern this morning in the situation room which is closed by the way to the press and cameras get back to liz peek on this issue. i mean both sides -- really digging in their heels. we could be having this conversation forever. so how does this play out? >> well there's some hope now that nancy pelosi has been elected, speaker of the house has the gavel that she may be in a stronger position to actually come to terms with president trump. look, her -- the progressive wing of the democratic party doesn't want to give into anything to do with donald trump are so it is a problem. but you also have the hifnght
caucus at some point they're going to stand up and say let's fix a dreamer problem. which we have all that could be -- a compromise. that has the hope that there's a deal on the table and though we have not heard any specifics from the white house, it stands to reason this is a bargaining chip. hobbsly i think it is shameful that it is a bargaining chip these are hundreds of thousands of young people who were promised on security and it went away overnight. this has to be taken care of and frankly if i were a latino voter, i would be pressing the democrats do this deal. i don't -- honestly, we all know that the in thes in the fast have voted for a wall have voted for a barrier trump has backed off this idea of a solid concrete thousand plus mile wall now 700 miles which is what democrats voted for in 2006 and not necessarily a concrete barrier so really what is their problem other than fact that they are object that's exactly
resisting donald trump. but i thought yesterday's press kfns when he brought the senior border patrol people in, and they said yes. walls work. walls have worked in various places where we've had them on border, and here's the thing that democrats no one ever asked nancy pelosi who constantly quacks about how she's all in favor of border security. what do you mine by that? if a drone is out there, a drone is not going to stop a person. it can note that a person has crossed the border. >> stop them from coming across. not stop them from coming across what we want to stop is tens of thousands of people coming in every or year -- undetected, with that everyone reports are actually in the country and i think honestly, calmer and more ration gnat heads have to prevail on this there's a deal to be done. it should be done. pmpleght all right liz peek thanks. great stuff as always a quick look at the futures ahead of the opening in 20 minutes from now we have that blowout jobs number talks with china next week all very positive for dow showing it
will be up 277 point. up well over 1% same story on s&p 500 and nasdaq showing more than a 1% gain at the open at least at this minute. fed chair jerome powell taking a lot of heat for raising rates we know that. so will mr. powell reensure markets you'll hear what he has to say in the 10 a.m. hour. president trump making a surprise appearance to the white house news conference yesterday. played up need for border security and gave a special thanks to frequent "varney & company" guest border patrol agent brandon judd joining us live at 11:15 this morning today. also, speaker pelosi calling out trump he doesn't know if he can deal with powerful women. up next we're going to see what the president's daughter-in-law has to say about that, laura trump live on set with us after the break. (engaging uptempo music)
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the best deal it's as easy dates, deals, you know the rest. (owl hoots) read reviews, check hotel prices, book things to do, tripadvisor. all right next up, ahead of the shutdown meeting today, nancy pelosi took a jab at president trump's fear of women in power. take a listen. >> you said in august you thought he might be afraid of you and afraid was women coming to congress. >> i don't know if he knows how to deal with women in power and women with with -- strength. but we'll see. >> well there's quite a statement bring in laura are trump daughter-in-law of the president and trump 2020 southeastern advisor laura thank
you so much for being here. >> absolutely so back things up the question can the president deal with women in power? apparently nancy pelosi has some questions about that. >> oh, my goodness nancy that is so ridiculous on every possible level but what democrats do is identity politics it is saying that the president has some problem with women. which is completely crazy remember this is a man by the way who was a businessman -- before he became president. donald trump has never judged people based on their gender based on their color. he judges people based on successes, and failures. he's going to be great with with all of the women in congress. i guarantee you he's going to have in problem dealing with them. >> listen you're a big campaign advisor we've got 2020 is beginning to be here before you know it now it is just next year like tomorrow. [laughter] you said in a lot of women out there who support trump they don't post it on social media but when they go into the vote booth they put their x down for the president what is the
secrecy and problem? >> i think media tends to make people feel badly for being a trump sporter whether you're a man or woman they try to make you feel badly there's a notion out there that as a woman, you should be a democrat. you should be -- it is ridiculous you should be voting based on what you believe in and if you believe the president is right person for this country then you're going to go vote for him but i tend to think that the mane stream area dealses with women really not voicing their support very loudly for president trump but again i always say they will get in the voting booth and they'll vote for him. >> what do you tell your father-in-law as he heads to 2020 what's one area that he really needs to work on what are you telling him? you know mr. president you need -- >> if he asked me for my opinion i certainly give it to him. but -- he's doing such a great job on his own. i think it will be very interesting to see what happens with this border wall funding. listen, a lot is in nancy pelosi's arena right now we'll see if she wants to keep the
government shutdown because really kind of on her right now. but i -- i think his own best advertiser he's his own best campaigner. i can are talk to as many people as i said but reality is the country is going in the right are direction. because of this president, so much has had turned around people are more successful now because of this president. and i think that more people will vote for him in 2020 than even voted for him in 2016. >> were you surprised that mitt romney's attack on the president just as he comes back senator op ed in washington post basically saying that president trump isn't fit to be president he uses expression not risen to mantle? >> i mean he hasn't learned his lesson yet apparently mitt has not learned and i would like to say i'm surprised by this. sadly, i'm really not. the reality is, the country voted for donald trump. the country did not vote for mitt romney he has his shot this president is doing a great job. i think he can sit back and take cueses from the president and learn a thing or two because this president is doing incredible job. i think he's a little bit
jealous that donald trump got the job that he wanted not too many years ago. so maybe it is some sour grapes maybe he's jealous. positioning himself for a challenge in 2020 republicans -- >> that would be not very smart of him because i think the country would be upset with that what a waste of time and effort if he did something like that. j assuming that family was down in mar-a-lago for christmas holidays but president wasn't i get this -- that they're moping around in oval office did you face time him? we did. we talked to him listen we all miss him but we understand he had to stay in washington d.c. he was wore very hard actually the entire break. unlike some people who were off in hawaii having a great time he was there in the white house in the oval office working hard for the people of this country because that -- that's what they wanted him to do and that's what he knows he has to do. so while we missed him dearly and wish he was with us we understand he couldn't come down.
>> a lot of people say never want to be the president of the united states it is a thankless job the weight with on your shoulders does he have a talk about being president in a way that wow, i never thought it was going to be like this? >> i think he misses the old days i think we all in a way miss old days sometimes but i think when he travels around this country, and he hears if from people that impact he's making in their live and you see on the world stage, the difference that he's made for our country already, the way the imhi is -- is back and booming and people have job ares who haven't had jobs in many years and respected to get around world he knows this is bigger than him and much bigger than any of us, and i don't think he traded it for the world. >> lare are a trurp thank you so much for being here. really appreciate it. thank you. all right let's take a look at the futures for you. all pointing higher lots of good news to talk about today employeeout jobs number talking with china next week all good. like the dow is going to be up close to 300 points when we open up in just 11 minutes from now. by the way, president trump fda might be getting ready to green light a plan that would allow
all right quick look at the futures for you we've gone up from 270 up over 300 point now that's at least what is indicating in ten minutes now s&p and nasdaq pointing about to a gain of one and a half percent. all right now on to this huge deal in big farmer bristol myers set to buy gene come in dark marc siegel joining us from las vegas are you having a good time out there? always a good time right? is this a good move by bristol myers a good year.
>> both companies are in trouble and that squib shareholders are worried about this but i'll tell you why i think this is happening because -- bristol myers has a drug which is a cancer drug from uno therapy but merck has one that's getting more market share and did better in a clinical trial so they're looking around for more options and more ways to get into immune know therapy and cancer drugs while they have a problem too because one of its top drugs is going to be off patent soon but you know what it has done acquired a company called juneau that make the latest kind of therapy called cart takes cells out of the body reengineer them and fight cancer and ashley that is promises we've talked about it on the show so i think they're taking a gamble here it is that new process and new research works, they're going to look really
like a rose on this had. so it is a risk. but i think it is the right move. >> all right next for you doc to raise eyebrows trump fda might be ready to green light drug prescribing apps for chronic ailments you don't need to see a doctor to get a script how do you feel about that? >> ashley when i first saw this story, and i've talked to fda about this yesterday i was really reluctant to endorse it. i'll tell you why as a physician i want to be in the loop. i want to do the art of medicine. i want to see if a medicine is necessary. but then i started looking at certain statistics 78 million people in the united states need cholesterol drugs to prevent heart attacks and strokes and half of them are not getting and not getting it in why they can't afford the copay. they can't get in to see the doctor too long a wait and noncomplaint a lot of this population would taken their cholesterol drug or their blood pressure drug or their inhaler
for asthma if they could simply push a button on their iphone and you know what app would have the information they need so that they wouldn't make a mistake about whether they actually need the drug. i still think there's a need for a doctor here but i like this idea or more and more if it will reach a population that's noncompliant now it will be very good ashley for brand name manufactures this is not for the generics but at the same time that fda is pushing new generic drug ares, this is going to steer people in the direction of a lipitor or crest or a blood pressure measure that's a brand name. but again it is going to reach a population that's noncompliant so i'm for it. >> 30 seconds just i want to ask you about the flu season is that time of year, of course. what had kind of outbreaks are we seeing? >> we're seeing 11 states widespread more and more and more this is a very usual year. but it is an. ills a ashley worst kind, it is not as bad as last year this year, the the flu shot look like
it is a better match for the strains that are prevailing this year so i'm telling everybody out there we only have a 40% compliance flu shots in the united states get it right now please and look out for fatigue headache and for high fever that's the flu not a cough. you feel fatigue look like you've been hit with a truck. you have to get out of work, that's what you should do stay home if you have the flu. get the the flu shot. >> good was a as a always doctor marc siegel thank you for joining us from las vegas this morning. thank you so much. >> i'm going to bet on you ashley. i'll bet on you. i'll sending you money looks like a good opening underway on this friday session. we'll be right back.
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to be ringing about 15 seconds from now. but finishing off the week with some good news yes they should be clapping down at the nasdaq and 19 -- blowout jobs number, perhaps if you like on perhaps getting some trade done. let's see well markets we believe about a 300 point toup side move. for the the doug and there you go immediately up 220, 266 points all green so far and those stocks trading on the dow up 300 there you go all green. 300 on dow very close to 23,000. again, blowout numbers but we do have some things happening this morning that could influence the markets the fed chair speaking in the next hour. what will-to say hopefully not too much to move the market we'll see. but up 330 now on the dow let's take a look at the nasdaq and s&p following suit they are indeed s&p up 33 up about one and third percent at 2481.
take a look at the nasdaq tech heavy nays nasdaq up 65, with 69, take a look at the tenure yield which is sinking 2.63% right now on the tenure yield. of course after all of the goings on at apple, let's see what a is doing it is up, up -- two buck up more than one and a half percent of 144 on apple. all right lots to talk about joining us this morning jack tr barton elizabeth macdonald and suzanne lee great to have you all here. let's start with this morning's jobs report i want to -- what did you make of the numbers, dr? >> well ashley, a big surprise on several different levelses and a couple of really good things that happened there. i think that biggest one is that the participation rate it was up. which that was very positive that we got that. i think the one negative was that the wage inflation number at 3.2 versus 3.0 expected was -- was something that is not going
to play real well as a the fed if they start seeing that that's heating things up that's one negative i think that's why market pulled become a bit right after the -- right after the number but now taken right back off. so -- i think good stuff in general. smg i think it is actually good for american worker that you're getting paid more inflation might be going up but you need to get -- >> i would say 2018 is first in gauges since 2008 ten years to get to this point. and so if you're paying less at the pump getting paid more that's good for american economy. >> i agree. jack very quickly on that, feds mandate i would argue they have both why touch anything? >> it so manies pretty good with jobs number i would be popping champagne these are good numbers we need to see that because investor have been worried is market signaling something here. stock investors we know are out of their minds on best of the days but i worry with bond
market yield coming down this low. that signaling some kind of an economic slowdown with we didn't see coming job numbers puts fears at ease not to say we're out of woods. >> that's any next question wild swings that we've seen are they going away any time soon? >> problem is that market can sometimes be a reaction to economic data but sometimes, sometimes it can always cause economic effect if you have stocks continue to fall like this you have a drag in the wealth effect that causes pessimism might cause businesses to pull back, so we don't know how -- numbers are being weak very disturbing you know, regionally as well you know lack of new orders, back log not growing at all -- exactly. so worrying signs. >> futures still seeing rate cut by april a rate cut tracking that story for you 36% for -- yeah. interesting big part of the equation china more talks we understand next week. dr are we going to get a deal
soon do you think? >> i don't think that deal is -- i don't think the deal is eminent at all ash. i think everything that the white house has been doing is posturing for the really big play. i think they're going to push this right are up until the deadline and march 1st anything that would be done before then, the deadline for the tariff you know the 90-day tariff delay i think anything that was done before then would be a huge surprise so i think there will be some more positivity coming out of there but nothing definitive. making a if point of point withk story about china and spending going down and retail sales slowest in 15 year, yeah that's right we're seeing apple, ford gm possibly boeing kat caterpilr and p&g making sales in china also alibaba so that's the back story what's going on in china? >> wouldn't that be more motivation for chinese to say they're feeling pain at home to
come to bargaining table. pfnt major stock market in 2018, and there by the way there are pressures on a president for life because he needs to find over 20 million jobs for is 1.3 billion a year that's the mandate to stay in power to keep the people happy employed fed, of course, you know with the economy going. >> they're going upside down in there -- >> a lot of pressure on chinese leaders to get something done. good for -- for the trump administration having up or hand. there's pressure there and here and walking a line trying to keep it going for couple of more year we don't need added drag of a continued tariff so hopefully there will be enough pressure to come up with a deal. all right women you mentioned a physical apple shares took a big hit we know that last session after warning about weakness in china. fitzgerald with us earlier time to buy he said well when it hits 120 i'll jump in. what are you thoughts still a
good deal 144? [laughter] >> well ting that we've probably going to have some banging around here because people are now trying to figure out who apple is if they're not going to be the iphone gross company and 1,000 phone is not going to be the future. how are they going to come out of this? one thing i will say ash that i do like about apple right here is that they are right up against the very important level on the chart where they sprang board from back in july of 2017 when they have that big runup that big 60% runup from there until earlier this year so -- i nibbling here i've bought some and put some into my account here and maybe i'll buy some more at keith's level as well 378 smg we know iphone sales have stalled this is not new news. right, it is peaked iphone sales have peaked i would argue it is a cash machine look at what warren buffett is doing second largest share holder lost a lot of money yesterday. but tony one of the top apple
analyst on the the street he says arguably you can imagine a a pl and buffett buying 5 to 10% of the oustanding shares on the market which means that increases value per share. >> hasn't become a horrible company overnight let's be honest. it is still a cash -- >> in the street. if you're a long-term investor fine but we have to face tough facts i have a new iphone that should have been a big difference but a couple of thousand late in the pocket it is not a transformative experience like used to be. >> is that buyers remorse? pfnlgt i think next big upgrade cycle couple of years away. i can fell you it looks tasty at ten times earning but i have to tell you one fifth of the s&p 500 now trades at a single digit price to earnings ratio, ratio there's a lot of broken down out there. >> listen you can talk also forgive me about apple and it has a broader problem than china. you know, but there's a world lesson for all of the
manufactures of smartphones is cheap phones that's the way to go and question is with apple too late was it too slow in warning that iphone sales requester going to basically take a stomach stumble question of selling in emerging markets how can they afford them and it is 9,000. a lot of cheap impairtives compare that percap tay 6,000 a big income point. >> quick check had of the big board as we talk about 8 minutes into the session. not bad take you there to the dow up 356 point gaining back half of what we lost yesterday but a buck 3,000 up and a half 1.5%. check at the price of oil oil has been on the way up another 2.5% up a buck 2.8 sorry to say up to 2.25 that's national average regular. and straight day of thereins came to an end last night had
the party had to come to an end at some point but 2.25 to a national average but had didn't have to but it. maxine waters now in charge of the house financial services committee. jack, do bank need to be aware because maxine waters declared war on banks to be banks are they facing what more regulation? >> this is -- this question is -- our democrats bad for the stock market? i have had this question 10,000 times. maxine waters bad for banks bad for business. this stock market voted on what democrats are going to do for business stock market after democrats took the house went up twice as much as it did after trump. the more -- will she get -- look at me her committee, her committee has s&p power so that's a question will she give him a hard time looks like she could. >> not able to change anything effect iively but she can shine a big light on banks so they would not like to have.
bank evaluations are down there with a lot of other stocking you know -- >> that's true they've struggled and banks are financially strong right now. so i don't think that there's trouble. >> we were trying to have fun with this segment. >> try to have fun with it -- >> how dare you. [laughter] jack and dr thank you gentlemen for joining us on this friday another big check dow up 350 point not bad for the day's session a blow jobs number talk requests china, bullish about mood this morning at least for this minute. coming up, president trump's top economic advisor larry kudlow what does he make of the december jobs report i'm sure he's going to be glowing about it and latest developments with china we want to know and we will ask him, and oh yeah day 14 for the government shutdown are we any closer to a deal? we're going to ask a republican congressman after this, don't go away.
e well with let's check the big board up 372 points at this hour. on the dow above 23,000 a big jobs reports certainly helping with sentiment dow up more than 1.5%. president trump by the way just tweeting again just this and very simply great job numbers just announced and we can't disagree with the president. 312,000 jobs. for the month of december that is a blowout you'll right suzanne lee back to shutdown president trump meeting with congressional leadership at 11:30 eastern this morning in the situation room no cameras, joining us is congressman buddy carter republican man from georgia thank you for joining us i guess the question has to be
are you ready to work with the democrats to get a deal done? >> there is emphatically yes we are. but i wouldn't tell you that i'm deeply disappointed but a start to the democratic control of the house. i mean what happened with pure politics. mcconnell made it clear that he's not going to take up the bill that was passed the legislation was passed president made it clear that he's going to veto that if it gets to his desk in the house i think it is a poor start to democratic controlled house that has pledged that they're going to work in a bipartisan fashion to get things done. >> well compromise a dirty word many this situation both sides digging in their heals it is certainly the president's -- i guess the word i would use is water lieu this was a major plank in his platform when he became president he's not going to back down he wants the money to build that wall. and then democrats say we're not going to give it to you where's
the compromise? >> the compromise is in the subject matter. we need to focus here folks. we need to focus on the problem, the problem is, a border i've been there and seen it firsthand look at what is happening there we have human trafficking we've got illegal drugs coming across we've got terrorists, criminals coming across focus on the issue not on what a campaign promise it was. not on stopping someone that you don't like from getting it from from delivering on campaign promise but instead focus on the issue at hand and that is we need to secure our border. how do we compromise baa you know democrats are saying no money for the wall period. for something has to give where is that common ground in the middle does it involve daca dreamers do they get a fast to the citizenship is that a possible deal do you think? >> i would consider it. i think it is certainly on the table i'm not to what has been
discussed in leadership on both sides i haven't been in meetings, however, i will tell you that i think everything is on the table. i mean, let's talk about daca let's talk about funding for the wall and let's secure our borders we are enabling people to come across and that's wrong of us to do that. it's wrong for parent to sending their children thinking they could get across our border we need to secure borders so they don't take and put children at risk like that. ming well, we'll see what comes out of this meeting later this morning. buddy appreciate it thank you. let's check the the dow 30 stocks for you as we go to the break, looks for a reading up nearly 400 points now a sea of red except for one my -- vision isn't great but procter & gamble just one stock moving lower but up nearly 400 points on the dow well above 23,000 and guess what larry kudlow coming
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quick check of the markets wiping out two-thirds of the day losses and now s&p up nearly 2% and nasdaq is indeeds up 2% strong morning of trading, we're about 20 minutes in and see how it finishes, of course, taking a look at the dow winners for you some of those chip stocks intel up 4%. microsoft doing nicely pup two and a half percent goldman sachs as you can see up one and quarter american express up 3% visa also up 3% those are winners at this hour. bring in company on this. i guess -- this could get derailed guys if we hear from jer role powell who
is speaking down in atlanta at an event in the next hour. if he starts taking on more -- tone -- what's here question go again and this is a very much headline driven market right now. we don't want it to be fed driven either. because the effort for eight years with for eight years. i think what's really key here is -- of course the economic strength of job wage numbers coming in strong and whether or not woe get a deal by march first with with china and what's notable here is that trades delegation going over to meet with china does not include pete navarro so you wound per they're ready to roll. >> so he's been on talks prior to this but now he's not absent from delegation going, so you won per the white house is saying -- lower level. a lower level meeting at this point in beijing to set the table for a high per level meeting with a vice premier who is heading up the chinese side of trade talks he'll be heading to washington at the week after
the initial beijing talks so i think in the first quarter the the bar has been set so low with people so bearish on market also on a trade deal, i would say that, you know, it was baring interest rate increase were not expecting. and barring the fact that we're going to get a trade deal i think a trade deal to be honest. fnght what's bigger deal china or the fed? >> oh, i think both. what's more important? >> i think that fed. you know, in terms of what? >> in terms of that but also market per we can get a deal with china but global economy is slowing down and still hurting whether this teal will help substantially with the chinese economy. remains to be seen. but certainly there are warning signs that serge the global economy is slowing down had a blowout jobs number but manufacturing numbers some of the state has been soft in the u.s. so it kind of bring it is back to the fed does it not? >> it does. and so i don't know if that's going to cut rates actually i mean traders are like that and
futures were indicating that and slice of that. predicted market, i mean, listen, with i don't think it is going to happen. no, i think they're going to maybe hold a line and not raise by the end of the year keep your poutedder dry. i am still going to say that feater navarro not being any way attached to any negotiation could be a positive. but a deal to get rolling. i would ask larry kudlow they've had a falling out with them reportedly -- whether that's, you know, navarro still around. >> i would be curious too lighthizer leading trade talks. navarro by any means -- >> david is going you know, so right -- >> a fair point low level meet at least they're talking that's the main thing. but i want to come back to bigger picture is that china is under growing pressure as we with talked about quickly. they want a deal let's be honest. u.s. markets are dependent on one, the u.s. -- china is not doing very well right now, and who is their
large pest export market? the united states. >> china is weak by many measures slowed and china is trying to move its consumers in its economy off a heavy reliance on borrowing so they're at a hinge point right now tushing point in the the economy and confidence of kiewrls there not good. high or -- education and other cost come rolling in bring you back to u.s. economy and data has been soft we know housing market has been struggling we know that ism number was disturbing an we've had regional surveys that suggest suzanne brought this out that the back log are not there and orders are not there. inventory is not there there's a softening but then we have this blowout jobs number. >> listen, car numbers came in okay too from our autosales very good point emac. someone so okay -- larry kudlow we believe is ready get become to this morning job report joining us indeed larry kudlow counsel director larry,
stuart will have to be here but i'm next guy with an english accent to i'll talk with you. let me get your reaction to blowout jobs number pretty impressive. >> i love people request english accent. [laughter] it was a blowout number, and it clicked on all cylinders you know perhaps with get to that. let me just say as a matter of overview, because of the stock market correction, you know, corrections come and go all kind of powerless nobody really likes them but it is part of the free market story. because of this correction, there's an awful lot of pessimism around including the u.s. and the u.s. economy. and there's a lot of loose talk in my view loose talk without hardbacks about a u.s. recession and i say no. there is no recession coming there's no recession in sight. consumers are strong, jobs are rise, wages are rising, and let
me add to that for the benefit of my great and dear friends at federal reserve, more people working successfully at high per wages does not let me reiterate does not cause high per inflation. and, in fact, the inflation rate has been coming down even while we've been experiencing a continuation of the jobs boom. this is a supply side expansion it is a business side expansion. the business tax cuts large to small companieses, producing tremendous capital stock investment and productivity, and productivity and therefore i think fed needs to looking the a their models right maybe some more air in the tires get rid of the tires altogether because we have strong growth. strong jobs, and no inflation. that is a terrific optimal situation for our country or any country to be in, and a i hope
central banks take note of this. we're going to hear from jerome powell in next hour larry. you could argue indeed to your point that the mandate of the fed is being fully satisfied welfare stable prices no rampant inflation and we have maximum employment what would you like to hear from -- >> just as you said it. i'm going to give you the pen and, where is he giving the speech exactly? ashely: in atlanta much. >> all right. you need to put right what you said into his speech. the mandate is full employment. long stable, domestic prices. that is precisely what we're seeing. inflation rates, depending how you measure them, running 1.25
to 1 1/2%. productivity sin creasing. that is part of the supply side business tax cut story. people are coming into the labor force. we've had huge increases. let me see if i can flesh out, 360,000 people a month are entering the labor force. this past month, december, 419,000. 70% of private industry is sharing in this bountiful work effort. this is just what we want. just what we want. they're carrying the freight with improved productivity. it doesn't get any better than this. i would urge people to reconsider their pessimism. i will avoid the temptation to say america is a great country, although america is a great country but i will not avoid the temptation to to suggest pro-growth policies, the pro-growth policies, the incentive policies, the
entrepreneurial policies, low tax rates, big regulatory roll back, and i will be just a wee by the political here, put into place by president trump, are working. and they have been working and they continue to work. and if there is a little bit of disconnect between stocks and economy, so be it. i've been around a while. i have seen this before. probably you have have. we're on optimistic path. that is my message. look at numbers today. yeah it is a blowout statistically, but this is the kind of thing that is going to raise the animal spirits. i can hear people. i can hear people across the country going, whew, you know what, things are a lot better than some folks are saying. that is my view. ashley: unfortunately the fox is in the shop. i emailed mr. powell, larry. next one for you, delegation to china next week, progress being made on a deal, can we infer that? >> well, of course let's see how they do.
i know the president is cautiously optimistic. he had another talk with president xi of china. these are all good signs. we have a deputy delegation flying over this weekend. they will be there all next week as we said. they will look at commodities, agricultural, industrial goods. we would like frankly to see a regime of zero tariffs, zero non-tariff barriers and an end to all the state-run subsidies. these are central planning policies that are not working. the chinese economy is not in good shape, crucially, crucially, we have got to see a change in chinese law regarding the theft of intellectual property, regarding ownership where american companies must be
permitted to own their companies, and so that would end the forced transfer of technology. and we also want to see a shift in this whole cyberspace, cyber hacking. it is becoming very commonplace. you just use the internet cleverly, go into american companies, pull out their technology, the family jewels. i'm not here to blame china. i'm just going to say these are issues on the table, all right? in our discussions in buenos aires, argentina during the g20 they were on the table. when president trump and president xi had dinner, i was at that dinner, they're on the table. basically we know what sort of changes we need. now the question is, can we negotiate these changes and can we do so with enforcement, with timetables? remember i'm an old reagan guy,
trust by verify. these are very important areas. so, you know color me cautiously optimistic. we know what we're going to talk about. we're sending, you know, some very smart people over there. but let's see how that works out. china need reform. can i just say that? as you, you were reporting chinese economy is sinking. it's sinking. they have lost all market based reforms. maybe not all but they're moving on the wrong track, too much statism, too much central planning, too much central control, it doesn't work. retail sales, car sales, business investment, it is all slumping. ashley: with that in mind, larry, let me follow up on that. that is exactly where i want to go next. listen to fellow white house economist kevin hassett on apple warning about that weakness in china. take a listen. >> it is not just going to be
just apple. a heck of a lot of u.s. companies having a lot of sales in china basically going to be watch their earnings downgraded next year until we get a deal with china. ashley: what i'm getting from that, larry, it is not only apple hurting in china, other companies, u.s. companies doing business there because the chinese economy is decelerating. he is saying that's a good thing. i think ultimately because it does put more pressure on china, to get a deal done. it gives the trump administration the upper hand in trade talks, would you agree with that? >> well, let's see. those are, it is, you have asked a string of questions. they're all good questions by the way. let me try to take each block at one time. first of all kevin hassett is one of the smartest people i know. we went back and took a look at the chinese profit story. here's what we found.
if all american companies operating in china, okay, american companies in china made no profits at all, zero, it would only have a small impact on overall profits, 1.7% of total profits. that is very unlikely. american companies will make some money in china, but i'm just saying that 1.7% it's a pretty small number. so i wouldn't take that too far. point number two, the chinese economic slump has been going on for a while. you can run the charts yourself right at your desk off your computer. you're looking at 15, almost 20 year slump in retail sales and business investment. as i say, i think, i think the heyday of the chinese market-oriented reforms have passed. and number three, regarding u.s.-china relations on trade and the economy, look, we can
help them, okay. now we want a level playing field, right? we want to end unfair trading practices. as the president often says we want reciprocity, reciprocity, okay? three zeros, none tariff barriers and subsidies. i believe strongly these kinds of reforms china opens up its markets and slashes their barriers and if they play by the rules regarding technology, will help china. give american companies, this is kind of an offshoot, i don't hear enough of this, america is the most competitive economy in the world today. we're the hottest economy in the world today as per the numbers today as well as others. money is flocking toe america, tremendous investment, long-term investment. now if you give us an opportunity to export more to
china, bring those tariff walls down, bring those barriers down, if they give it to us, we will benefit, our trade gap will narrow, our exports will create jobs everywhere, including good-paying, hard-hat manufacturing blue-collar jobs but china will benefit. chinese companies, chinese people, will get the best quality goods at the lowest prices around the world if they give america more freedom to go into china. it will get them on the market path. then their slump, which really is about 15 years old can end, all right? market-based reforms. that is what we're asking and we're also asking to protect our technology, the family jewels. so look, the catch-all, okay? mr. tim cook is worried. he is a good man. talk to him frequently. runs a great business out there.
mr. cook should help us get the trade reforms through because it will be good for chinese growth and good for apple iphones be making in china. ashley: so how can tim cook help you? >> tim cook -- any ceo can help us. talk to the chinese leadership, for example. talk to the locals talk to the state people, talk to the top councils, talk to president xi, talk to my friend vice premier lee who is i think genuine reformer if the upper echelon gives him the running room. the chinese market is big, we get that, we would like more freedom and open but, but, but, president trump says a lot of times, if china will not cooperate, then our tariff rates may go up and our tariff coverage may increase because right now, it is an unfair situation. ashley: so what does your gut
tell you, larry, with regard to the march 1st deadline? can we get something done before those tariffs kick in on march 1st? >> yes, we can. i don't want to get ahead of it. we're focused on that. we're focused on the next couple months. beyond that we'll wait and see. that is president trump and so forth. but yes, many things can get done. we're going there. our group is going over there. we expect a higher level chinese group to be coming here in due course before the deadline. so let's be realistic but let's be, let's be optimistic about. let's be, i don't know the what is the right word, guardedly optimistic. you know me. i'm an optimist. if there is a will there is a way. you talk about lighthizer, who is the best trade negotiator in the business, he will tell you
we love to work these things through. we have a clear list. they know what we're asking. i just outlined much of it to you moment ago, that is what our deputies will carry but mr. lighthizer taught me down through the years chinese promises have to be backed up by enforcement. enforcement, timetables, trust but verify. can we do it? of course we can do it. will we do it? well, let's see. ashley: peter navarro is not going on this trip next week, right? he is considered, quite, for wont of a better word, quite hawkish and strong where the u.s. stands. does that suggest a more softer approach at least at this level? >> [laughter] peter navarro is an old friend of mine. he is a great american. i love him. ashley: that is all you're going to say? but he is considered to take kind of a stronger, more of a stick than carrot approach.
you don't think that's needed at this point? >> look, as i said before, you mentioned sticks and carrots. i guess that's an english, sticks and carrots. ashley: i think it is american. i don't know. >> anyway, it could actually be american. look our trade principles group works together very, very closely. i dare say we're on the same page. again a quick repeat. we know what we need with china. china knows what we're asking. but part of the whole negotiations simply must be enforcement. enforcement, okay? trust but verify. this is so important. that should not be an obstacle by the way but it's got to be part and parcel at the center of any reform decisions and any policy changes. i think our whole group is
completely unified on that. i believe president trump also strongly believes there have to be clear enforcement safeguard. ashley: larry, let's come back to the united states if we can to wrap up the information. the atlanta fed lowered its growth forecast. we saw stocks go south after some bearish manufacturing data also yesterday. the ism, you know, new orders are not growing. backlogs are not growing. there has been weakness on some of those regional surveys, which suggested the economy is softening. what is your feeling on that? are these just blips? is there real issue of the u.s. economy slowing down, along with the global economy? >> now there you go. i thought i had you on the optimistic path. now you're going south on me. as soon as we got finished with china. look it, the jobs numbers that came out today are so huge and have so many positive
ramifications, not least of which is labor force participation, hours worked, average hourly earnings, all these things creating income for family households. by the way did you know in this cycle, i will add this editorial, i want to keep you on an even keel, in this cycle, the blue-collar workers have had largest gain in employment, blue-collar employment, largest gain since the middle 1980s when i worked for ronald reagan in omb. when i was a reagan cub scout. second point, we did a study for eca economic council advisors, the local workers are getting faster pay raises than the middle workers. not higher, mind you, but faster. to translate that, overall wages are rising right now year-over-year a little better
than 3%, whicher terrific numbe. the lower end is rising 4% which is even more terrific. to your point about the atlanta fed, gdp now model. they will make big revisions, they always do. it is an honest model. i like to track it myself. they are 2.6 for q4. i'm taking the over. i think we'll get to 3%. today's jobs number, you will think i see very strong retail sales, very strong industrial production, business equipment and so forth. so, i just think, that is one of the, one of the fallouts from today's jobs number is going to be a lot of upward revisions in forecasts. ashley: i'm on your side. i'm not pessimistic, larry. i'm just pointing out some statistics and i appreciate what you're say but imagine if we get the china trade cloud away, we get that sorted, we've come to an agreement, everyone's happy and then we hear from the fed, look they're happy too. those two elements if we can
bring those together, we're off to the races are we not? >> i want everyone to be happy. i want happiness, choice, freedom, opportunity, prosperity. i love happiness. life liberty and pursuit of happiness. i love that. you're better. stu varney usually comes at me with a sledgehammer, no matter how good the numbers are, my dear friend stuart, we probably known each other more than 20 years i think you're much more even keel. i really like that approach. and i thank you for it. ashley: larry, we'll leave it right. there i will take the praise, high praise indeed. larry kudlow, thanks so much for joining us. really appreciate it. a fascinating conversation as always. thank you very much. >> thank you. ashley: emac, we saw the markets, we haven't lost any ground, i guess you could say that. still up 400 points on the dow. larry kudlow is great.
liz: yeah. ashley: he is very smart guy. of course he will gloat as he should over a tremendous jobs reports. liz: your interview started to move the market towards 500, about the dual mandate over the federal reserve. there is confusion what the fed will do in terms of raising greats. you actually moved the market toward 500, when he said, he respectively saying to the federal reserve, jerome powell, we'll be speaking with your dual mandate, solid employment, prices are low. you're meeting your dual mandate. you don't need to tinker with the rates right now. there is confusion. we have the negative ism manufacturing report but boffo, strong, blowout jobs number. so the market started going towards 500, it started come down when you pressed him on, i think you were strong with him -- ashley: on china. liz: on china. well he started to say we will, got out of him, larry kudlow, that tariff rates could go up,
coverage, fear of tariff rates what they will hit could also widen may increase. i don't know how much more wide they can get because virtually all the net exports into the u.s. from china will be hit with tariffs if we don't settle this by march 1st. we saw whipsaw action. you see the dow moving up toward 500, coming back down to 425, just in the space of your interview with larry kudlow. ashley: emac. great stuff. thank you very much. liz: there has been confusion out of the fed with their narrative. ashley: fed chair yes roam powell, we mentioned this to hairy kudlow will be speaking. there he is. at the american economic association in atlanta. very well could move the market. we'll bring headlines if he does. maybe jump in a little bit what he has to say. he is there with yellen and he ben bernanke as well. we wail wait to hear what he says about the jobs report.
liz: you make a great point. federal reserve is kind of mixed in it is narrative and its messaging. in december after jerome powell spoke, new york fed president john williams had to come out clarify two days later what jerome powell was saying. it is about the narrative coming out of the fed. what is your narrative, fed, given what larry kudlow said. you're meeting dual mandate. the markets could have given that to say no more rate hikes until next year. i'm not sure odds of a rate cut. fed funds future slice of that market. ashley: let's listen hear what mr. powell has to say. >> we've seen pessimism in economic surveys. we saw blockbuster jobs report this morning. you have been optimistic about the economy. is that changing? what is your outlook for the 2019 and beyond? >> thank you, neil. great to be here with janet and ben as always. i will talk a little bit about 2018 and turn to the outlook if i may. 2008 by some measures was a good year for the united states
economy and most of the hard data we see coming in remain quite solid and suggest on going momentum heading into 2019. you mentioned this morning's jobs report, for those who haven't seen it, we had 312,000 payroll jobs added, very strong number. we have unemployment remaining below 4%, for nine months, longest period since the 19 of 0's. labor force participation picking up again to the upside which is very, very welcome. wages continuing to move up. average hourly earnings moved up. that is quite welcome. for me at this time doesn't raise concerns about too high inflation. so very strong report today. we've also seen on a more forward-looking basis we've seen initial claims for unemployment insurance near their historic lows. so that is more of a, that is more of a leading indicator and we still see real strength
there. consumer spending has been strong right through december. the reports we're getting from the retail industry suggest continuing spending right through the holiday season. so, you know, i would say those are all good data points. there is yesterday's institute for supply management report which came in well below expectations. i would just provide a little bit of context. there the ism report is a survey of manufacturing conditions and it had been at historically high levels. in fact higher than it had been even in the strong expansion of the late 1990s and much higher than it had been during much of this expansion. so it is now at a level which is considered, consistent with ongoing moderate growth and is about at the level or even higher than it has been in the earlier years of this recovery. so that is a little bit of context. i would say the fact that it moved down so much in one month is something worth keeping an eye on. notwithstanding report though, i
would say u.s. data seem to be, seem to be on track to sustain good momentum into the new year. i'll talk about china for a second. china has been a big part of this story and the most recent data from china have been more mixed. china's consumers appear to be pulling back as seen in the apple news, the weak retail sales data. two pmi reports we got earlier this week, show soften in external and domestic demand and this seems to be spilling over into other asian commodities and global commodity prices such as copper which china is such a big buyer. that said, chinese authorities are responding with additional stimulus and china and rest of emerging asia should continue to expand at still solid pace this year. so overall i would say the picture for the rest of the world remains consistent with continued growth here in the united states. so good data still i think is the story looking into the rear view mirror but financial markets have been sending
different signals. signals of concerns about downside risks, about slowing global growth particularly related to china, about ongoing trade negotiations, about what maybe let's call general policy uncertainty coming out of washington. and among other factors. so you know, you do have this, this, difference between on one hand strong data and some tension between financial markets that are signaling concern and downside risks. the question is, with those contrasting sets of factors how should we think about the outlook and how should we think about monetary policy going forward? now when we get conflicting signals as is not infrequently the case policy is very much about risk management and i will offer a couple of thoughts on that to wrap up. first, as always, there is no preset path for policy. and particularly with the muted inflation reads that we've seen coming in, we will be patient as we watch to see how the economy
evolves. but we're always prepared to shift the stance of policy and shift it significantly if necessary in order to promote our statutory goals of maximum employment and stable prices. and actually like to point to a recent example, when the committee did just that in early 2016. i mentioned this in this december press conference in passing. as many of you will recall in december 2015 when we lifted off from the zero lower bound the median fomc participant expected for rate increases for 2016 but very early in the year in 2016 financial conditions tightened quite sharply and under janet's leadership the committee nimbly i would say flexibly adjusted rate path. we adjusted full rates later in 2016. the economy weathered a soft patch in the first half of 2016 and then got back on track. an policy gradual, policy normalization rao assumed. no one anothers whether this
year will be like 2016 but what i do know is that we will be prepared to adjust policy quickly and flexibly and to use all of our tools to support the economy should that be appropriate to keep the expansion on track, keep the labor marketing strong and keep inflation near 2%. i will stop there, thanks. >> so, chair powell, as you note, since the last fomc meeting markets have moved in big ways. 10-year treasury yield is down quarter of a percentage point, fed funds futures path suggesting no rate increases, maybe rate cuts in 2019, are the markets telling you made a mistake? >> i think markets are pricing in downside risk, is what they're doing. they're obviously well ahead of the data, particularly if you look at this morning's labor market data and other data i cited. markets are expressing concerns about global growth in particular. i think that is many about the main focus and trade negotiations which are related to that. i will just say we're listening
carefully to that. we're listening with sense civilly to the message that markets are sending and we're going to be taking those downside risks into account as we make policy going forward. >> at your press conference you affirm that you intend to allow the balance sheet continue shrinking at a steady rate. would you reconsider those plans in light flexibility you talked about amoment ago? >> let me talk about the balance sheet. some years ago we decided that rate policy was going to be the active policy tool and that the balance sheet would be allowed to shrink gradually predictably in the background and it was supposed to be about as interesting as watching paint dry in janet's famous locution. that division of labor served us well, we think served the economy well. so we also said at the very beginning, i think in our
original, certainly the first policy norm salmation plans i was involved in 2014 we said that we would be prepared to adjust our normalization plans as appropriate to achieve our goals. so if we ever came to the conclusion that any aspect of our norm salization plans was somehow interfering with our achievement of our statutory goals we wouldn't hesitate to change it. that would include the balance sheet certainly. today of course we're hearing a lot from different groups of people about the role that the balance sheet normalization may be playing in the markets. i think we are of the view that, what really happens mechanically when, you know, when our securities mature is treasury issues a comparable amount of securities but they do so across the yield curve. the amounts are not that big. they haven't been that big compared to the issuance treasury is already undertaking so we don't believe our issuance
is an important part of the story of the market turbulence that began in the fourth quarter last year, but, i will say again, if we reach a different conclusion we wouldn't hesitate to make a change f we came to the view that the balance sheet normalization plan or any other aspect of normalization was part of problem we wouldn't hesitate to make a change. >> broaden our conversation now, dr. yellen if this expansion lasts into next summer will be longest on record. you played a significant role making that the case. how confident are you the economy is on track to keep growing through 2019? how worrying do you find latest moves in markets and some of the survey data. >> i agree with chair powell's assessment he just offered up. the data suggests we have a pretty strong economy. consumers you know, consumer spending is 2/3 of all the spending in the economy. with strong job growth and income growth. debt burdens having been -- ashley: there you are. we heard from jay powell.
janet yellen responding to what jay powell had to say, what jay powell had to say the chairman of the federal reserve moved markets. we were up 380, 400. we're now almost up 600 points. re-emphasize what he said there. the economic data is still very strong. he mentioned unemployment numbers today. strong, participation rates are up. he also said wages were moving up gradually. he didn't have concerns about inflation. with regard to muted inflation we'll be patient. with regard to the balance sheet which has taken away lot of liquidity in the markets, some believe bigger factor than rate increases he said look, we have all the tools at, available to us. we are prepared to adjust he says gradually and predictably dues the balance sheet but we can adjust if we believe we have to. all those very dovish comments. in other words we're not continuing on autopilot which he
said earlier in another press conference that worried markets. that the fed would go ahead make moves without regard going on what in the u.s. economy and what financial markets were saying. he made a difference between the u.s. economy and markets were telling us. overall very dovish comments. we're hitting fresh highs almost 600 points. emac, what do you take away from that. liz: he equated to 2016 how janet yellen sitting on dais with him was nimble. december 2015 they were talking about four rate increases on the dot plot but the fed backed off that. after the economy hit a soft patch. so again, he said we are prepared to move nimbly and be patient with the, with rate hikes. he essentially is saying that the balance sheet, when he said the words, we are ready to use all tools, balance sheet, buying bonds that is when the market started to push towards 600. ashley: is this more dovish than
we've heard him to be? liz: explicitly dovish from jerome powell. the narrative has been mixed coming out of the federal reserve a bitcoin fusion what they have been signaling they will do coming out. you see the whipsaw action in feds funds future, 90% possibility of rate hikes, and 90% probability of no rate hikes. i think is calming move coming out jerome powell. ashley: markets like what he had to say. come on in bahnsen group, david bahnsen and gary kaltbaum, kaltbaum capital management and fox news contributor, gary kaltbaum. what powell had to say the market seemed to love. up 600 points. >> the key is balance sheet comment, something we've been talking about since the last fed meeting the rate hike issue is not nearly as important because of the state of credit markets. we have so much reflation that has taken place in the corporate
economy, there is so much new leverage is on, i don't think excessive but credit conditions deteriorated to some degree. there is less credit quality out there, dissing traction from the liquidity in the economy could become problematic. for them to talk down that issue on balance sheet reduction is a big deal because the market wants to belief dollar liquidity will be there for the economy to do what it otherwise organically doing. ashley: gary, your thoughts? you have been very bearish. the markets are behaving exactly as you expected but jay powell putting out some calming words this morning? >> well, jay powell basically said we hear the stock market. in 2012 jay powell was saying investors know we have their back. looks like jay powell is targeting the stock market. we'll see what happens. we were down 600 yesterday.
i think we got it back today. even with today's rally, 1200 points below moving averages. there has been room to run after 4268 dow points in 14 days to the downside but leave no doubt, he is going all bernanke now which is targeting the markets. and i believe it is a shame. i hate the fact that you have one person deciding on how much ammo to use. bernanke did a trillion dollars a year of printed money. europe followed. japan followed. we'll see if the markets react well. today is just one day. ashley: but gary are, you know, maybe he is listening, making the right moves, the fed mandate, stable employment, and prices we have both of those which is basically what he is saying. the markets are saying get out of the way, we don't need fed intervention in any fashion right now. >> exactly. i wish we would be abolished. we don't need them.
market forces should dictate all of this. all they have done interfered with price, price discovery, manipulated rigged yields that screwed savers for eight years, created asset bubbles. that is not arguable as we things like bitcoin and ridiculously priced real estate as well as private equity around the globe. but look, they're here to stay. they're not going anywhere and i think the die has been cast and they are going to target markets here. they are not raising rates again, i can promise you that. if need be, rates will be coming down, the next move will be lowering of rates if not more, if the markets don't cooperate. liz: jerome powell, fed chair just now saying that he has not heard anything negative coming out of the white house. he would not resign, he would not resign if the president asked him to. ashley: pushed that question aside. liz: pushed that question aside. ashley: david, what does it do for markets going forward? the fed says hey, to gary's
point, we've got your back. we have chinese trade talks going on next week in beijing, could this help stablize the market? >> yeah, i think so. the issue with the china deal cannot be ignored. it's a big factor that looms. a lot of us take for granted china has to make a deal because things have gotten so bad there and i really believe more and more the u.s. needs to make a deal. they simply cannot let this go further, put us into recession the year before a presidential election but there are other circumstances that we just don't know. we're not sure how ready the chinese authorities are to push this thing out. my belief is that we're going to get a deal, at least cosmetically, very likely substantively. the market will respond well to it. but i can't bet on that 100% conviction. puts you in a difficult position as a asset allocator, there is really uncertainty around that,
that uncertainty where we get this volatility from. so when you look at the fed issue and the china issue, the fact of the matter is, i happen to agree with gary. jay powell has done much better job hiding his inner bernanke than janet yellen did but ever since the '98 greenspan put i believe all of these fed governors ultimately look to the stock market. you have to admit, gary, chairman powell did a better job of hiding that over the last six to 12 months but i think ultimately they're looking to risk assets as a signal, saying okay we surrender. the fact of the matter is i don't necessarily mind if they keep raising rates one or two times in 2019. but the balance sheet issue is the problem because they let corporate america relever so much, if they pull away the punchbowl the hangover is to severe for the economy. >> the problem is they never should have done this balance
sheet bs in the first place. >> i agree, gary. >> print money in thin air to buy up markets, think about that? what happened to two words, free markets. markets are supposed to be about investors and traders making bets on price and tile yet we have one person deciding which way it goes? that is why i, bernanke is like a four-letter word to me because everybody else around the globe followed him, hey, gee, wow, markets followed everything he did. so europe is still in negative rates and still printing. japan is in negative rates and still printing. they have no ammo left. that is big issue going forth for them. ashley: it is already done. that is looking back whether you a guy with it or not. they have this massive balance sheet. they're trying to unload it. they say they're aware what is doing to the market. they say they will do it gradually. whether you believe it should have been there in the first place it is. so the bottom line they are trying to get rid of it in a fashion that will not upset the applecart of the markets, right?
>> and i give them credit for doing that but i want you to think about this. we're still at 2 1/2% rates, ridiculously low on a historical basis. we still have a gargantuan balance sheet, just to unwind some of that causes dislocations in the markets? that scares the willies out of me. we may get to a point one day where the markets shoot a certain thing back at the fed, interest rates on long end just goes up regardless of them, then what happens? look out below!. so i keep my fingers crossed they can continue to control everything that they think they can control and all will be well but i worry what happens at the end of the day. by the way, not to mention all these moves have enabled $22 trillion in debt here as well as 250 trillion around the globe. that is without a doubt a gargantuan headwind to even better types ahead. liz: you know i like what david bahnsen was saying. over the last two decade -- let
me back up. the question is, has the federal reserve boxed itself into a corner with whether or not to do future rate hikes? because when david bahnsen was talking about '98, that was russian devaluation of its currency, the greenspan put was bailout of long-term capital management. it blew up under bernanke with bigger bailouts for the economy in way of money printing but when they started to raise rates, saw awe shakeout starting in leveraged loan market and junk bond parts of corporate debt market and emerging markets theres were nervousness and when you see the dollar, the dollar reacted dramatically what jerome powell just said, started to weaken on the talk of the balance sheet as a tool again, i just don't know. david, has the federal reserve boxed itself into a corner with rate hikes? >> i think so, i want to point out about '98. very interesting i am is late where we are, liz, in '98
greenspan was cutting, russian devaluation, long-term capital, disruptions in one quarter, market dropped 19.8%. sound familiar. >> yes. >> we were in the technology boom. all the economic circumstances were really favorable yet they were accelerating dovishness all because of risk assets. here we are now, good gdp growth relative to where it's been, very low unemployment but what's the one thing has them concerned as gary pointed out. it is risk assets. because the fed has decided -- liz: you have the dot-com bubble collapse, internet collapse in the '90s. >> i say one other thing. we have to talk about one man's decision on the economy and trillions of dollars when we should talk about how great the people of this country are doing with their hard work and their
sweat and their toil and their risk capital and the fact that we're creating new technologies every day and these great companies are creating new wonder drugs to help people out and live better lives. poverty coming down. all these great things are happening and we have to talk about this one man and his decisions on where life is going to go based on the ability to create trillions of dollars out of thin air to screw the savers in order to keep markets afloat. that to me is just ridiculous. liz: you know what it feels like? we go back to the obama era of the fed doing forward-looking guidance when we want to look to ceos forward-looking guidance. ashley: not them, right. liz: not be trapped in the teachers faculty lounge with economists deciding direction of economy. ashley: let me ask you this, putting china and fed all aside where dot markets go from here
we talked about the ism yesterday. the markets and economy are separate but with regard to the economic data where do the markets go from here and what can invests get from all of this? >> let me back up a little bit. i have been bearish on most of the world since february when it topped out. first week in october i went bearish on half of the market that was bullish because that topped out. i have to now consider coming off the stance because, look i do believe in never ever fighting the fed. seems like to me, this guy quietly, unassumingly said, oh, we are ready if markets continue to go down and we can be on a wednesday in the middle of week, not a fed meeting, all of sudden we get a surprised fed lower the rates a quarter point, we move up 500 points before we can go boo. that is what these fed heads have been about in many years. i remember back in 2012. we were going into another bear market and bernanke all of
announces qe3. ashley: he is talking again. >> i agree with what both ben and janet said the tools we used in the crisis after hitting lower bound generally worked. many raised concerns, i raised concerns when i got to the fed, i said some time ago, concerns they raised appropriate to raise them, didn't bear fruit. we didn't see high inflation or asset bubbles, those kind of things. the real thing i echo ben said about this conference we're having this summer, in fact we're spending a whole year thinking like this. we're trying to engage with the public, not just with the profession, but with the public in general to explain ourselves a little bit in this era of lower interest rates. how are we going to conduct policy. how are we going to communicate and use our tools in away that keeps the inflation target credible and serves the goals that we're assigned. >> so i want to come back to something you mentioned during your opening comments both, so
for example, in 2015, 2016, chair yellen experience ad time when tighter monetary policy in the united states seemed to tighten financial conditions around the world, slowed growth in emerging market, created feedbacks loops, that affect u.s. economy, parallels to what we're see now and taper tantrum in 2016 signal qe would not go on forever created some feedback loops. for those two episodes in your chairmanships can you reflect on lessons you learned for relvan for current policy and what you learned out of that episode should be internalized as fed officials work today? >> i think looking at risks or feedbacks that come from the global environment, clearly that -- ashley: we listened in there. talking about the temper tantrum or taper tantrum i should say of 2013. every time mr. powell is jumping in, we're following exactly what he is saying.
david, get back to you. gary, ask you, fed talking about policy, jay powell saying we're maybe more accommodative, we're more nimble, able to adjust, what does that do from an investors's point of view? gary says you have to change your stance a little bit if the fed will take this tack. has you're outlook changed a little bit? >> my outlook is this. the fundamentals of the economy are strong, but that doesn't mean risk assets will not continue to be volatile. one problem gary being right the fed should not be out there bailing out risk assets, is they are bailing out risk assets, makes us difficult to position a portfolio what ought to be case versus what is and i think gary agrees with that. from my vantage point i want to play rotation from growth to value. there are still very solid fundamental cast an brought at a great valuation in the u.s. stock market.
i can't buy the whole index or buy fang to get to that investors are hung up trying to get back into last year's trades and year before's trades. the fact of the matter those companies are very expensive. if you want to play defense and be positioned for positive returns i say it all the time, so i apologize for beating the dead horse, dividend growth stocks are the way to be right now. they're showing you that their free cash flow is still growing, they're more defensive. they have strong balance sheets. there will be volatility around the trade war and around the fed. yet there are companies that have gotten very cheap over the last two months. ashley: gary i know you've been very defensive, but to david's point there has to be some good deals out there with the market action we've seen. what areas are you looking at? >> well if the bear market continues there aren't really any good deals. i will need to see more evidence.
i am big believer the market will show itself with good leadership. i really don't see a lot of leadership out there. all i see out there right now as i said a 4268 point dow drop with a bounce of about 1500. of course be today off of this -- ashley: oh. which lost him. need more money in the satellite machine apparently. david, gary was making to the point there is no leadership in this market right now. we have the big tech companies led for so long. we don't have that there. we were told the financials would be next big leader in higher interest rate environment. that hasn't worked out. where is the leadership coming in the markets? >> also were told we're in higher interest rate environment. that has not played out either. the bond market was was up down for 11 months and ended in a positive return because of how much yields dropped in december. i actually think there is a
leadership area right now. it is the whole value space. you look at growth outperformance overvalue. it is this huge straight line up for the last nine years with a little interruption in 2016. all of sudden now that chart of value outperforming growth is v'd up. i think you will see that throughout 2019 for the same reason, that you have the kind of fed lightening the load a little bit. they will not go forward with all the tightening we thought might be there and the fact of the matter is there is still good organic earnings growth. i don't want investors to believe the entire fate of their portfolio revolves around the federal reserve. it isn't true. you need positive earnings growth. apple did not drop this week because the fed is tightening. apple dropped because they're having organic revenue creating props in their own company. so you have to find sectors, find companies not doing that that is what we're focused on doing and i believe dividend
growth give you great incation where companies have a lot of confidence in their own outlooks organically speaking. ashley: let's change gears. david, stay here if you can. bring in governor mike huckabee who joins us now. not giving to ins and outs of markets, governor. i want to talk about economy and blowout number jobs today. which added 312,000 jobs today, blew out estimates. can we just say, thank you, president trump? >> i think you can. when you deregulate a lot of things strangling businesses. lower taxes and -- ashley: governor huckabee, so sorry, jay powell talking again. we have to listen in very quickly. >> scars on anybody who was working at the fed at that time. the takeaway the market could be sensitive about news about the balance sheet. to the pace of normalization, anything like that. that is one of reasons why the balance sheet is supposed to be in the background, grat all
predictable, paint drying we didn't want two active tools going at once. one of the other takeaways, i agree with everything janet said. one other takeaway, particularly after the taper tantrum there was particular back and forth do other countries have freedom of monetary policy and that sort of thing. a lot of research has been done, much of it by fed people and the sense of it is the best thing we can do is to be as transparent and predictable as possible. a strong u.s. economy is good for the world. sometimes the role of the u.s. monetary policy in in other countries is exaggerated, notwithstanding, sometimes there is a real effect and it helps, if you're a small, open economy, you can today's some of that with strong institutions particular with floating exchange rate. >> turn to something else, an argument that i heard people arresting with recently goes
like this, for much of the post-volcker raid moderation era the fed has been very successful -- ashley: just listening to jay powell, taking about the taper tantrum of 2013 when they suggested they would stop, slow down the buying of assets to put liquidity in the market. however the worst thing about all of that i interrupted governor mike huckabee, i never want to do that governor so let mow just ask you again, i promise we'll get through this, just the jobs report and its real validation of president trump's policy, low taxes deregulation, economy is unshackled, we're seeing results of that? >> ashley, first of all, let me say to you, when the president names me as fed chairman i will expect to you interrupt people so that i can be heard too. i get it. totally get it. ashley: done. >> that may be coming soon by the way, just so you know. there is a headline for you. but here's the headline for the economy, it has been the policies that we've seen over the past two years that made a
big difference. when you deregulate, which means you get the government's boot off the necks of businesses and allows them some breathing room, when you cut taxes, you free up capital so they can pay people more, invest in inventory and invest in new products it shouldn't be a shock you see these kinds of numbers. i think everybody, especially economists are always surprised i wonder if economists are so smart they're always surprised at numbers but even economists are surprised by the robust numbers that have just been reported today. ashley: in the background of all of this, governor, is the shutdown, partial government shutdown. congressional leaders meeting again within the hour to see whether they can break this impasse? how damaging is this shutdown and how firm should the president stick with his requirement that there should be funding for a wall? should he stay the course? >> he should absolutely stay the
course. without a doubt. he has to. if he doesn't, they will run over him for the next two years. his own party will doubt his ability to be as stern as he has proven to be in the first two years of his presidency. this is a resolve that he has to show. this is a hill worth dying on. we're talking about the national security of every american. this isn't trump's wall. this is america's wall. this is a wall to protect people like officer singh who was murdered in cold blood by an illegal who shouldn't have been here. what i wish the president would do, my advice to him, go on national television in prime time, in scripted address and lay this out. explain when nancy pelosi says walls are immoral, ask her, is the wall around the vatican immoral? should she scold the pope? is the wall around her house immoral? and which of the 650 miles of the wall we already have is she willing to write a piece of legislation so we would tear it down and get rid of that immoral
wall? ashley: governor, we have to jump in. jay powell talking again. >> we have to understand there is tremendous uncertainty around the actual location. we're in an era where inflation dynamics such that the relationship between slack and changes in slack and inflation, changes in inflation, is very weak but it is still there. it is clearly still there. and in just about all the research that has been done. so i think we've been willing to revisit our views very much willing to revisit our views what the natural rate is and also our understanding of what it is. so, if you look at forecast of fomc participants we have unemployment remaining below 4% through the entire projection period. you have inflation remaining 2%. we're not acting on it as though there were some certain number. we're very much, i think we're very open-minded about both what the, what the level of the
natural rate is and also what the implications are for inflation. i think it would go too far to just ignore resource constraints completely. because we can get the old inflation dynamics back over time if we want to, where this was very strong relationship between slack and inflation. i think that is the way i would think about it. >> how about this linkage, part of the traditional phillips curve relationship, low unemployment creates tight labor market can, wage pressures which flows through to broader inflation? there are two steps there. there is tight labor market to higher wages. higher wages to overall inflation. that is the linkage we haven't seen as much of lately. >> both of those links weakened significantly since we were young, since the 1960s. since i was young anyway, before you were born. it weakened a lot. we had wages going up faster than productivity plus inflation during the latter part of the 1990s expansion without having
price inflation. so we, there is a link between the two, between wage inflation and price inflation is pretty weak and you know, wages going up is not necessarily inflationary. we know that very well. i think we have inflation under, unfour, i'm sour unemployment under 4% for nine months now. we have inflation under control and, i think, i think that's a pretty good outcome and we sure think it can continue. >> dr. bernanke is the phillips curve dead or really flat and really uncertain? ashley: there you have it, jay powell saying look just because we have wage inflation, not necessarily the link between that and price inflation is pretty weak. isn't that right, emac? liz: i mean he just schooled him wage increases do not create inflation. demand does. demand is umbrella, basket of
prices, waynes going up, consumer confidence, leading indicators pointing positive. so you know. what he just said, absolutely right, pointed to the late '90s as an example, wages were going up and inflation did not take off. ashley: right. liz: the markets are popping higher because he continues, jerome powell -- ashley: saying right things. liz: signaling calm out of federal reserve. watch this, the cboe volatility index which was acting like evil knievel on motorcycle like an ekg really calming down again. gary kaltbaum won't like hearing that. the fed causing calming. we'll take it. dow moving higher. ashley: is governor huckabee still with us? >> yes, i am. ashley: we'll get off jay powell , next fed governor.
sales are hurt with the chinese economy. they have china very important market to them. that said, how important is it for u.s. and china to get this trade dispute settle corporations who have invested in research and development and then have chinese companies steal it. i think the president is dead right in playing tough with him. nobody's done that before. they're not used to it. they're used to always finding the u.s. government capitulating to the pressures of globalist companies, and i think it's high time that we say look, if we're going to play big boy ball, we're all going to play by the same rules and you're going to
play by them, too. there may be some pain. there already is, and there probably is going to be more but ashley, sometimes when the doctor gives you a diagnosis, he puts you through some painful treatment in order to heal you. i think that's what we better expect. there could be some pain going on in the next few months, perhaps longer, but that's the only way we're going to get to a true sense of fair trade, free trade and the kind that everybody wins by. liz: switching gears, governor, we have alexandria cortez now talking about a 70% tax hike on the upper, upper bracket. she wants a 70% rate. governor, you have talked about this, too. the democrats like to talk about the so-called halcyon days of the eisenhower years when rates were high, not acknowledging there was recession because of high rates. they always look back and think that high rates will fix and be the cure-all for now cortez's
green new deal, where she wants to get rid of fossil fuels and run on renewables and have the upper brackets pay for it. will the president have a more active veto pen this year when you hear ideas like that coming out of the likes of alexandria cortez? >> i hope so. she's pretty good at dancing and by the way, conservatives don't give a rip she was a great dancer in high school and college. we kind of admire the fact she's got pretty good moves. but we don't admire the nonsense of a 70% tax rate. if you want to kill the economy, kill the job numbers, kill the wage increases, throw something like a 70% tax increase. just let her go back to one of the democrat heroes, jfk, who understood that the tax rates were too high. he would be a republican today in economic policy and for that matter, in defense policy.
ashley: very good point. talking of the democratic party, there is a real split, i believe, in this party. you have the nancy pelosi brigade, then those who would not vote for her as the new house speaker, about 15 of them, they actually ran on not supporting nancy pelosi. then you have the far left and the moderates. this is a party that's trying to figure out what it is. is it just the party of resistance or does it have an annu actual agenda. what are your thoughts? >> i don't think it has an agenda other than maybe to impeach the president, which is nonsense. most americans don't even understand impeachment is nothing more than indictment. it doesn't mean he gets removed. there's not a chance, let's just say under heaven that there's any way this senate would ever by a two-thirds majority vote to remove this president from office. so all of this noise and bluster about impeaching the president, i think the president should stand back and say knock yourselves out, go ahead and do it, because if they want to
honestly re-elect president trump and give congress back to the republicans in the house, let them go through an impeachment process. i guarantee you it will be a huge backfire on them. ashley: have to leave it there. governor huckabee, let's jump back in. jay powell talking again. >> they don't survive very well. the other thing about the united states of course is that most credit intermediation takes place in the financial markets, not the overregulated supervised banking system. it's just a different thing. financial capital markets are not prudentially regulated. it's a real strength from a capital raising and dynamism standpoint. it's something we worked on a lot and i think what we have done with the banks is a good body of work. i feel good about where the banks are. i also feel fine about the capital markets. i think there's more to be done in central clearing, for example, and more to be done in the capital markets generally. >> if i can step away from
economic policy for a moment to talk about the economics profession. dr. bernanke, you have become president of -- ashley: there you go. you heard jay powell saying he's happy with the banks and capital markets. that was jay powell. we want to thank governor mike huckabee, gary kaltbaum for being very patient as we jumped in and out of this event in atlanta, where fed chair jay powell there with janet yellen and ben bernanke. what jay powell said this morning has pushed these markets higher, up above 600 points, basically wiping out the 660-point loss yesterday. he said the fed will be patient when it comes to rate hikes. they will also use all the tools, whether that means slowing down the rate of tightening their balance sheet and taking liquidity away from the markets. all that, he said we can adjust and we can keep an eye on what the markets are doing. in other words, a much more dovish tone from jay powell today rather than previous statements that the fed is on auto pilot, we will raise rates regardless. a much softer dovish tone from
jay powell today. liz: basically wiping out the losses from yesterday. ashley: 660 points yesterday. liz: now 630 up. ashley: and 312,000 jobs added in december, way above what was expected. good day for the markets, getting all sorts of reassuring word and data. let's bring in jonathan hoenig who has been watching all of this. wow, what a morning. the fed, gary kaltbaum had a fit because he said the fed shouldn't have anything to do with it, how silly it is that one person that runs the fed can have such an impact, but regardless, that's the fact and the markets liked what jay powell had to say this morning. >> yeah. it's so true. when fed officials speak, investors literally have to step back and wait and see what they say because we know they have a direct impact on the market. i'm happy to see stocks higher today. i don't think we're out of the woods just yet. that is to say, i don't think this is the beginning of a new
bull market in stocks but boy, we had such a terrible shellacking in 2018 that it's positive to see some stocks getting a bit of a hit here. ashley: if the fed sticks to its words, they are going to be steady as it goes, full employment, inflation under control, our mandate is being fulfilled right now. now we have word that china, there's talks resuming next monday in beijing, lower level talks but leading up to higher level talks. that's encouraging. if we can get a deal with china, we know the fed will be dovish, at least they say they will, does that change your outlook for the markets in 2019? >> well, when it comes to the fed, they don't know anything. how many times they propose something, it changes along the way as the fed always says, they are data-dependent. there's tremendous uncertainty out there. we know that. that's why i'm so, as an investor, attracted and attached to watching market trends. actually, it's the price of
securities, that's what we trade. we don't trade the fed or earnings or the quote, unquote, economy. we trade price. what i look at in terms of my evaluation is price action itself. that's where i try to get my clues of what's going to be working, what's not going to be working. even today, as the market is up 600 points, there's still more 52-week lows than 52-week highs. to me that's just an indication, as i said, that i don't think we're in a bull market yet despite a strong day. ashley: that said, are there attractive propositions out there? are they getting now into a price range where you say i'm going to have to pull the trigger, this is a good deal? >> well, one of the sectors i have been looking at, it doesn't exactly go with this notion of the revival in the american economy, but is gold. gold has really been in a stealth bull market. the price of the metal itself was up by about 4% in the fourth quarter. there's a lot of gold stocks, alo, au, sa, bvn, all these names that either one month, six month, three month highs, to me
i go back to price. ashley: i have to stop you in full flow. let's listen in to jay powell. he's speaking again. >> -- a top priority for us, the kind of behavior that we read about is totally unacceptable, will not be tolerated at the fed, and we're committed to a diverse and inclusive environment. i really strongly believe that diverse perspectives are not only do you get better results, but you know, young people coming up are accustomed to a diverse and inclusive environment and they will want to work in places like that. so part of our business model is to attract the young talent. i want the fed to be known within the economics profession as a great place for women and minorities and other diverse people to work and be happy and be listened to. >> so dr. bernanke and yellen, you both had excellent academic careers and you both made decisions to move into public service at various stages.
i think in the standards, you get a ph.d. you go to university, try and get tenure, that is not the usual stepping stone. can you reflect on what role public service played in your own career, your own evolution and what you would recommend to younger scholars out there trying to decide should i try and do a fellowship at the fed, something like that? >> well, it was something that figured in my thinking as something i would like to have as part of my career. ashley: you had jay powell talking about diversity at the fed. very important he says to him. jonathan, as we speak, we are up nearly 3% again on the dow, now approaching up 680. we just edged back a little bit. you are talking about gold which to me is such a safe haven play which is interesting, because gold has not really seen many gains, despite all the volatility, but it is now. my question to you is how do you play gold? do you buy physical gold or an etf? how do you play it? >> what you want to play,
ashley, are we on bbc or -- i'm not sure exactly. you want to play for the long moves. you want to play for the long moves. look at the gold bull run in the early 2000s. it went up basically every year for a decade. when you are buying any investment including gold, i think you want to play not for 3%, 5% pop, but 30%, 40%, 50% pop. there's a number of ways to do it. gld is an etf, it tracks the price of gold. there is also gold stocks as well. like the old saying goes, a rising tide lifts all boats. just as all the fang stocks were lifted in that bull market. if this is a bull market in gold, you will see all those names do well as well. ashley: is there anything else other than gold, though, where you attempt to take a nibble right now? >> well, i'm also looking at kind of goes along, actually, with names that are correlated with a weaker dollar. this is a big investment scene throughout most of the early 2000s, the dollar going down, the price of foreign assets going up.
once again, there's etfs, exchanged traded funds that benefit when the value of the dollar goes down. i know it doesn't exactly go with the president's buy american, hire american ethos but the point is to make money. if this is a trend, weakening dollar that people can profit from, it's one worth investigating, and udn is one etf to check out in that regard. ashley: i guess, you know, another issue that i think investors would like to get from you, is this volatility, the ups and downs, up 500, down 700, down 1,000, up 500, is that something we are going to have to get used to in 2019? >> yes. there's two ways to look at it. in many ways, this is a return to more normalized volatility. we had a number of years there of really low volatility and a very strong stock market. in many ways this is just a return to normal. i do think, however, we heard chairman powell just a few minutes ago here on fbn talking
about he wouldn't resign if the president asked me. i do happen to think a lot of what's going on from government here, tweets and resignation proposals, et cetera, i do think as we started talking about it, that doesn't impact investors because what's happening in washington does impact what's happening on wall street. the more i think we can get government out of the financial markets, the more calm they will be in 2019. ashley: we have a real divided government. is that good for the markets? they're not doing anything. >> well, let's hope one of the issues i think is spending. we didn't hear too much about t it. i think we will hear about it in 2019. if that can be an economic decision, you know, we are talking about $5 billion for the wall but not about the trillions and trillions of dollars in national debt. once again, this was a big issue, it's affecting the market, affecting the value of the dollar, our currency and the interest rates as well. if a divided government means perhaps reining in some of this government spending, might not be a bad thing. ashley: and you are confident we can get something done with
china and if we can, that cloud goes away and maybe we are a little more bullish on the markets. >> yeah. certainly. query ceos in 2018 and many, many of them as you know talked about the trade tensions with china. forget even the tariffs. we know that's costing consumers billions and billions of dollars. trade tensions with china impacting their bottom line. we heard from apple, obviously, yesterday. many of the car makers in 2018. any resolution to this impasse without question would be better for the market and for every american. ashley: you mentioned apple. it's interesting, is there a price -- we have had some traders say it gets down to 120, i'm in. others are nibbling at it at around 144. do you have any comments on apple? >> yes. of course. you would rather buy it at 200. you would rather buy it higher. this is a very foreign concept for people but the idea markets move in trends. you don't want to bargain when it comes to stocks. that sounds kind of anathema to
people but you would rather buy it at 200 for the move to 300 or 400 rather than trying to get a bargain because you very well might end up, like for example what happened with microsoft. people were buying it all the way down and they got a bargain but waited a decade for that stock to recover. ashley: i don't want to get too wonky but one thing people say about the markets, look at the treasuries. the fact the seven-year treasury yield is under the one-year treasury yield. all of that is out of sync and that suggests a recession. i don't know whether that's true but that's what the wonky ones are telling us. any thoughts on that, jonathan? >> well, i mean, there's been a lot of americans talking about higher interest rates but there's been a massive rally, as you know, in treasury prices, meaning interest rates have come down quite precipitously. as you said, inversions, oftentimes we have seen the last couple weeks short-term rates be higher than long-term rates. historically, this does tend to precede a recession, not to mention the terrible stock market in 2018.
so it's another example where price might be preceding the fundamental data that's yet to come. ashley: all right. jonathan, thank you so much. he does a sterling job of walking us through many issues. emac, let me bring you in on this. i mentioned the inversion of rates suggesting that long-term rates are less than short-term rates. not to get into the weeds on it, but are we going to jay powell? i have been interrupting everyone else this morning. the theory being there's a recession maybe not in the near term but certainly within 24 months. liz: that was always a dicey proposition because of the fed's balance sheet. we never knew with the effect on treasury yields and the fed rolling off. ashley: let's listen to jay powell. >> this was something, obviously ben has been working on for a long time but there's a lot of progress to be made there. i think it's still early days and working that out.
>> i would say something related, systemic risk, understanding what gives rise to systemic risk, how we can measure it, how we can detect it, and what kinds of tools might be relevant in correcting it. i think this has become a fertile area for research, but really -- ashley: there you go. that was very interesting, wasn't it. it's hard when you jump in and out of these conversations. sometimes they have just a quick answer, then go to janet yellen or ben bernanke. of course, jay powell being the fed chair right now, anything he says and comments on any issues can move the markets and he's certainly done that this morning. we are up nearly 700 points, basically saying look, we will be patient, he said. we have all the tools and we can use all the tools, emac, when it comes to slowing down the rates of the tightening of the balance sheet, or maybe no more rate hikes. it was a very dovish comment at the beginning of this event in atlanta. all the markets, whether you like it or not and i know gary
kaltbaum among others are horrified we are waiting on the words of the fed chair, but he did say the things the markets wanted to hear. liz: yeah. you know, the real problem for the markets has been what is the fed going to do, and there's been sort of this incoherent narrative coming out of the fed. mentioned earlier, in december, the new york fed president basically, john williams came out two days after jerome powell spoke to clarify what jerome powell spoke, so jerome powell today being very clear that yes, they have various tools at their disposal and they are going to be patient and flexible and nimble as they were in 2016 when the economy hit a soft patch, and he said we will avail ourselves of all tools, meaning the balance sheet, that's when the market really started to move towards 600. ashley: well, he did mention the very strong jobs report today and kind of praised the economy in that sense. let me bring in on that point paul conway, former labor
department chief of staff. paul, when i first heard the number, i think the estimate was somewhere in the 170, 180 range. they said 312, i thought i misheard it. this is a blowout number, would you not agree? >> yes, completely. i think this is one of the things that on fox business, you folks have been advocating for policies that actually create the terrain for growth, and here you have it. now we actually are breaking 300,000 and i think it's a blowout number. i think it's great. i think it's fantastic backdrop for the president for his meeting with nancy pelosi today. ashley: any particular number that stood out to you? a lot of news being made of the participation rate is up to 63.1%, up .2% from november, and very strong indeed. it shows a very healthy job market. >> yeah. that stood out but the other thing that really stood out is the tick up in the unemployment number which is a sign you actually have more activity, more people coming into the job market and you actually have a very high number of people who
secured jobs in the month of december. in specific sectors, manufacturing looks great, housing looks great, and health care, where you have more services and out-patient and more services in hospital-based, those are all trends that are good. it means people are getting care in alternative ways. many of the different sectors here are looking fine and they are direct reflections of where the policies have been for deregulation and with taxes, in my opinion. ashley: health care, by the way, added 50,000 jobs. that, the largest increase on record so that really is impressive. also wages, paul, up .4% month to month, up 3.2% year over year. would you call that solid? >> yeah. i call it solid. here's the important thing on wages. you have to look and say over the past eight to ten years, we went through a record number of years here where people did not have the ability to accumulate wealth, especially younger people working multiple jobs and that type of thing where they're
trying to save money for different things or get themselves more financially situated. so when you see consistent wage growth, i think that's a good thing. i think that can continue. but i think the onus is on nancy pelosi and the democrats to be able to answer this simple question. are the policies that we are advocating in front of the american people going to help people keep their jobs, create new jobs, and increase their capacity to realize their aspirations through continued wage growth. that's the key point. ashley: tax cuts, deregulation, take the handcuffs off. it's amazing what you can achieve. one of the issues we have had, many people tell us on this show, is there are jobs out there that just cannot be filled because there are not enough skilled workers to fill them. is that something that's being addressed or is that still a problem, do you think? >> it is being addressed. i think credit has to go to the private sector here. i think the private sector has really focused over the past couple years on being able to retrain workers for some of
these more highly technical jobs, taking people with one set of skills and investing in them. that is important for long-term economic security and for job security. but the other thing that's going on here is this. you have so many opportunities being created, you have the private sector now working out with disability organizations and with the disabled and those who have traditionally been poor or in minorities that are hard to hire, and trying to invest more money in ways to make them more effective in the workplace through technology assistance. i think that's a huge credit to the private sector and a further indication of the robustness of job creation in the economy. the federal government obviously under the secretary of labor has taken a whole new look and approach at how job training is going with a lot of reform, and credit should be given to the administration for that as well. ashley: amazing jobs report. emac called it boffo. i think that's about right. paul conway, thank you so much for joining us. and to jonathan hoenig who talked about the impact of the
fed, the markets and everything else. thank you both for joining us. about ten minutes from now, congressional leaders will gather once again at the white house. they will be inside a closed door meeting in the situation room and of course, any news coming out of that meeting, we will bring it to you immediately. well, this was the scene yesterday at the white house. president trump making a surprise appearance in the white house briefing room and the border patrol president was right there with him talking about the need for a wall, and brandon judd joins us next. ♪
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president trump will be meeting with congressional leaders at the white house. this is the latest round in the border wall funding fight. edward lawrence is at the white house. edward, any sign that progress can be made? reporter: yeah, we have to see. i can tell you at least the lawmakers are showing up. as we speak, lawmakers are coming into the white house now. the president is going to meet with the top leaders in the house and senate. the president saying this is going to be a negotiation. he wants to talk to them about how much money they would put forth for border security, possibly towards a border wall. the democrats passing funding bills that only exclude border wall funding and only funds the rest of the federal government through the end of the fiscal year but not the department of homeland security. the white house here criticizing especially nancy pelosi's comments yesterday where she called the wall immoral. >> i wonder if she's going to go on a crusade and take down all the fences and walls across this country. i certainly hope not.
i'm sure that the people that have them around their homes, the institutions that have them, whether it's the vatican or anywhere else, are not going to be real happy with the fact that nancy pelosi is calling their walls and their security immoral. reporter: in fact, the president claiming this is all about politics. he on twitter went after democrats who are not only saying or criticizing him about the use of the wall but also criticizing him, saying they would like to impeach him. this is what the president tweeted out. quote, as i have stated many times, if democrats take over the house or senate, there will be a disruption to the financial market. we won the senate, they won the house, things will settle down. they only want to impeach me because they know they can't win in 2020. too much success. i will tell you nancy pelosi as she was leaving the u.s. capitol said she is going to talk to the president about that representative's comments asking that he be impeached using an expletive for that. again, the meeting happening any minute now. ashley: edward, thank you very much. now to what happened at the
white house yesterday. our next guest was there and received some praise from the president. roll tape. >> brandon judd has been a stalwart in terms of justice for people, in terms of fairness and in terms of the toughness you need. you have some pretty tough situations. it doesn't get much tougher. ashley: joining us, the man himself, brandon judd, active border patrol agent, national border patrol council president. thank you for joining us. the question is, does the president get his funding for the wall? >> he's certainly going to try. he's going to do the best that he can, using his negotiation abilities and i think he's going to get border security. i appreciate the praise that he gave me, but i will trade all the praise in the world for true border security, for secure borders to where we can once and for all end this debate and move on with other things that are important in this country. ashley: i guess another question i have for you, is this partial
government, how is it affecting you personally? >> personally, i'm working for free. i wasn't there when my children woke up in the morning on christmas day, i was out patrolling the border. come saturday of next week, when paychecks are supposed to hit the bank, i won't be receiving a paycheck so it affects me personally, yet at the same time, i realize that the american public has spoken and they have spoken strongly for border security and because of that, i support the president in this shutdown because this is what the american public wants, and i'm willing to sacrifice for that. ashley: i'm sorry to make this so short. we have to move on. thank you, and thank you for doing all the work you do and for no pay right now. we really do appreciate it. thank you so much. >> thank you. ashley: take a look at the market. session highs after jerome powell said the fed is going to be flexible with its policy going forward. we'll be right back.
ashley: happening right now, president trump meeting with congressional leaders right there at the white house. we of course are looking for any progress on the border wall funding standoff. this is a closed door meeting in the situation room. no cameras in there so if we get any news or lawmakers speak afterwards, of course you will see it right here. we will find out if any movement at all on the standoff. now to your money. check the big board and the dow 30, all 28 of the 30 higher. verizon and walmart in the red but the market overall, the dow up 555 points. we are off our highs but still above 23,000, at 23,239 on the dow. come in, come on in, donald
luskin. thanks for joining us. we lose 660 points yesterday. here we are, up 550 today. what's your comments on the market's psychology right now? >> markets are wandering around wondering who the next leader's going to be. so many people have made such a fortune on apple that it's seen as invulnerable and no company's invulnerable. come on. it's a one product company. eventually that product growth is going to slow and people will have to face reality. that doesn't mean we are facing a recession or bear market. just means that an individual company has an individual problem. it extends a lot deeper than china, by the way. if you actually read the press release from tim cook, he puts china in the headlines but then he talks about how, well, people aren't really upgrading as much as they were supposed to because those replacement batteries turned out to be cheaper, gosh darn, i guess that doesn't have anything to do with china. come on. it's just one company. things are going to be fine. ashley: well, that's true. i agree with you on kind of
shifting the blame for apple's woes, it's not just the chinese economy, but i do want to talk about trade with china. do you think the hard line is working? >> well, sure it's working. every two or three days, some headline comes out of something that china is offering the united states. before they even meet formally to have negotiations. we called this negotiating against yourself. you go back 20 years and read "the art of the deal" by donald j. trump he says this is what you want to get the guy on the other side of the table to do, get him negotiating against himself. the best way to do that is scare the bejesus out of him. that's what trump has done. one of the reasons markets are so volatile is a strong man like xi jinping, president for life of china, if you are going to scare him, chances are you are going to scare the stock market, too. this is how this game is being played. it's being played for the highest stakes in the world at a very high level but a master negotiator. it's going to turn out fine but it will be rock and roll right
up until the last minute. ashley: you're right. it already is up to now. of course, have to mention the fed, because like it or not, what they say, jay powell, the fed chair, what he says does have an impact and he sounded very dovish this morning. the market, the dow reacting. >> oh, my goodness. what you saw this morning was jay powell entering rehab. he just took the first of the 12 steps which is admit you have a problem. the problem he has is on the first non-economist to run the fed since 1979, that didn't work out so well, and i had the disastrous december fomc press conference and the market completely lost confidence in me, i'm sorry, i'm sorry, i'm sorry, give me another chance. you know what happened a week ago, right? there was a meeting with mnuchin and powell and powell said i will give you two choices. either you can take a more dovish position or you know what, i think the ambassadorship to ecuador is going to be opening up.
ashley: i wanted also, another one for you, i wanted to talk about oil. we had a build of some 7,000 barrels, doesn't sound great because we were, in fact, expecting a three billion barrel draw-down. so obviously, not the draw-down we were expecting. that could be a proxy of lack of demand but you say oil has returned to normal levels after the president bought out of the iran nuclear deal. >> well, oil storage on a global basis is at normal levels so when opec puts on production quotas, that means it will bite because when they put on quotas back in early 2017, global inventories were huge. so it didn't matter that they did quotas because everybody had all this oil in storage. didn't matter what the heck opec did. if you didn't like opec, go to your storage. now you can't do that. so their production quotas are going to make a difference. i think oil has seen the bottom. ashley: all right. we will hold you to that. if not, there's an
ambassadorship open in ecuador. donald luskin, thank you for joining us. appreciate it. federal reserve chair jay powell spoke last hour and yes, moved the market when he said this. roll tape. >> no one knows whether this year will be like 2016, but what i do know is that we will be prepared to adjust policy quickly and flexibly and to use all of our tools to support the economy should that be appropriate to keep the expansion on track, to keep the labor market strong and to keep inflation near 2%. ashley: shows key words, quick, flexible, he said all the right words for the markets. come on, ron paul, former texas congressman, presidential candidate and by the way, host of "the ron paul liberty report." ron, i know what you think about the fed. do you think the fed knows what it's doing? >> even if they try hard and are well-intentioned, it's impossible.
there's no group of people or an individual who knows what millions of people are supposed to design and that is price. prices are key to all marketplaces and here we regulate and assume that we should have monopoly control of the most important price in the world and that is the price of this dollar and the price of money. it's impossible. it's all a gimmick. they play games, they push the market up, they push the market down, they rescue the market, they deceive us with definition because what they are dealing with today and what powell was talking about is inflation. but no, there is no inflation because they measure inflation today in the general sense by watching the cpi which is rigged. inflation is when the federal reserve creates new money. so yellen and bernanke created $3.7 trillion in reserve and they're saying we got to get rid of that because that's a distortion of the market, but that's painful so they won't do it. so it's inflation they're dealing with, inflation they
don't admit to. they don't believe the stock market was inflated, or the bond market was inflated. they say the cpi's okay which is a falsehood, too, because cpi for some people is very, very high and very, very damaging. ashley: but their mandate, bottom line, is to keep inflation at 2% or at least prices stable, and maximum employment. that's their dual mandate, we are told. that seems to be what they've done. what's wrong with that? >> yeah. they also work at maintaining a healthy stock market and if you had looked back ten months ago, they say it's perfect. people were claiming credit for it. everybody loved it. but the handwriting was on the wall and something was unstable about the stock market and quickly things changed, and trillions of dollars got wiped off the books. that's the same way with the economy. the economy is wonderful and perfect, but when a recession or depression or some crisis hit, it comes quickly. that's what people ought to be prepared for, because it's totally unstable, it's been
built on an economic monetary system that is unknowable and a fake, and therefore, they better be prepared for all the mal investment and the debt that is unpayable and unsustainable and they don't talk very much about that, either. ashley: very quickly, the shutdown. how much has that hurt this economy and this country? is there a way out of it, do you think? >> i don't think it's hurt that much. that's good news. i think the more people get along without the government and not thinking there was a crisis, i think it's great. most of the people, 80% of the people in this country said what shutdown? hasn't bothered me. i say well, that's, you know, 80% we don't have to worry about. but no, it's all political. every ounce of it is political. ashley: do we need a border wall? >> i'm not -- i have never been in favor of a wall and fences and all this. but we have to have border security. i can think of better ways of doing it.
we have been able to protect our borders for a good many years and i think we should look to ourselves and look to the principle of protecting private property, and i think we can come up with an answer under the circumstances. ashley: ron paul, as always, thank you so much for joining us. we really appreciate it. thank you so much. >> thank you. ashley: there you go. libertarian, true libertarian says we don't need a fence, we don't need -- there are many who agree with him. let's check intel, if we can. the biggest gainer on the dow right now. there you go, up nearly 5%. up two bucks at $46.69 for intel, the chip maker took a hit on the apple news, of course, recently. bank of america says this company well-positioned to outperform its competitors this year. that's why we are seeing the stock price. check tesla. the company says it plans to start delivering the model 3 to china customers in march. if anyone can buy them in china right now. check game stop, buyout deal could be announced by mid-february. that according to the "wall
street journal." the stock up 13%, up another $1.70. now this. maxine waters taking over the top spot on the financial services committee and she's promising to reverse a lot of what the president has done. we are on that. also, recreational marijuana has been legal in california for a year but the state is taxing and regulating it so much, it's hurting business. only in california story for you next. ♪ nah. not gonna happen. that's it. i'm calling kohler about their walk-in bath. my name is ken. how may i help you?
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you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today. liz: federal reserve chair jerome powell responding to questions about president trump's criticism, including whether he would resign if president trump asked him to. roll tape. >> no, i'm not. i have no news for you on that. >> there's discussion of a face-to-face meeting between you and the president. if invited, would you accept that invitation? >> again, i have no news on that, nothing's been scheduled. i would say that a meeting between presidents and fed chairs do happen. i can't think of any fed chairs who didn't eventually meet with the president but again, nothing is scheduled.
ashley: guess what? hospitals must now publish the starting price tags for every service and procedure they perform. that's thanks to a federal mandate that went into effect on january 1st. the prices must be published online, but health care experts stress the consumers should not consider these prices to be
realistic. is that up or down? the mandate aims to provide transparency in health care. now this. congresswoman maxine waters is taking over as chair of the financial services committee and she says she's going to go after the banks and try to bring back regulations. come in, larry elder, larry, i chuckle with maxine waters talking about regulations for banks. she has murkiness in her own background, does she not? >> she certainly does. during the financial services meltdown, she had a meeting with the secretary of treasury, hank paulsen, and did not inform him she and her husband had a financial interest in banks she sought to bail out. she was brought up on ethics inquiry. it collapsed because she pulled the race card and the inquiry just went supernova. she also has routinely been voted one of the most ethically challenged members of congress by a left wing ethics group.
so putting maxine waters in charge of the house financial services committee in my opinion is sort of like putting michael moore in charge of the atf. ashley: nice analogy. another one for you. a new report says legal sales of recreational marijuana in california are struggling. why? because of taxes and regulation. are you surprised? i don't think anyone is. >> well, i think some of the people that voted for the referendum to legalize marijuana for recreational use thought the black market was going to go away. as you pointed out, there are two big factors they overlooked. taxes and regulations. you add the taxes and regulation, it turns out the price of legal marijuana is almost twice the price of illegal marijuana, not too surprisingly a lot of people are continuing to buy illegal marijuana. ashley: just those regulations and taxes, there's no incentive, right, to do it legally. >> that's right. there's regulations and taxes,
they even regulate packaging, they regulate ingredients, all sorts of things, and again, it's double the price of marijuana so a lot of people buy it illegally, continue to buy it illegally. ashley: only in california story. we love it. larry, you are there, a beacon on the west coast. put it that way. thank you so much. >> the lion never leaves the serengeti. i'm saying here. ashley: very brave. good for you. appreciate it. check the big board, why not. here we go. the dow up 608 points. i think we were getting close to 700 at one point. certainly nice gain off yesterday's 660 point loss. the dow well above 23,000. take a look at apple, too. it's been taking a massive hit recently on its woes in china, making a bit of a comeback after yesterday's rough session. up 3.5%, five bucks at $147. little bit of a reprieve for apple. two big hacks in the news. one on marriott, one on tribune
newspapers. both of them coming from overseas. coming up next, we have a cybersecurity expert who says attacks like these are the biggest threat to our national security. he will make his case, next. ♪ shield℠ annuities from brighthouse financial allow you to take advantage of growth opportunities with a level of protection in down markets. so you can be less concerned about your retirement savings. talk with your advisor about shield℠ annuities from brighthouse financial, established by metlife. - with tripadvisor finding the right hotel at the lowest price is as easy as dates, deals, done. going on a work trip?
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specimens. you get it all on "varney & company." there you go. now to this. two major cyberattacks of late, one involving marriott which china was said to be behind, and the other involving tribune newspapers carried out by an unnamed foreign entity. our next guest says cyberattack are the biggest threat to u.s. national security. come on in. oz sultan. thanks for being here. make your case. >> think about it this way. we have the marriott hack, that went on for a couple of years, right, so 500 million people exposed inside of that. the problem with that is passport information, photographic information, everything you would need to clone someone's identity. then secondarily, we have this tribune breach. the tribune breach is a bigger issue. about two weeks ago, there was a breach of a power system that really wasn't covered that much but the new jersey cybersecurity counterterrorism and information cell which is a very long name,
has reported on two things. one, on the east coast there was a secondary attack that was using microsoft word docs designed to bypass all of your antivirus software. this trib attack and those attacks went after critical infrastructure. the purpose of these attacks -- ashley: to power? >> this is we are talking about the backbone of the publishing industry. these attacks weren't necessarily focused on disabling the trib. they were focused on the backbone. i think the risk factors we have to look at are three-fold. one, the security protocols of all these companies need to be reviewed. two, if they are going after the cloud infrastructure, just the backbone, they are actually looking at longer term shutting things down. why? because there was a piece of rans ransomware purported to be part and parcel of this. it had charged something like
300 bitcoin -- ashley: you pay this ransom, we will release, you get your computer back? >> right. or it just breaks all of your computers which means if they don't have adequate backups of these things, you are going to lose all your information all together. i think the long-term challenge we have to look at here is one of how are we going to guard this critical infrastructure. two, the trib really opens the door to saying listen, all businesses are at risk. three, you know, in an era when we're worried about what russia is doing and misinformation and disinformation online, this raises the larger scourge of what if counterattacks of this nature were coupled with misinformation? ashley: the problem is, we have been hearing this time and again for years. we have got to do a better job of guarding against this. to your point, it was going on for two years at marriott before anyone raised a flag. it appears we are almost powerless to stop this from
happening. >> i don't think we're powerless. i think we -- ashley: why is there a head line every day of another hack? >> because you need to start holding ceos accountable. this is really what it comes down to. you know, the average expenditure by most corporations is 2% or less of what their total fiscal budget is on cybersecurity and technology all combined. so if they were to increase maybe 1%, right, think of what the impacts are to the bottom line. think about what the impacts are to the stocks of every single one of these companies every time there's a cybersecurity hit, and also think about the fact that insurance policies are not going to cover these things anymore. so if there isn't a change in strategy by companies, and there isn't a change by ceos, watch their stocks tumble and watch their customers walk away. ashley: it feels like the hackers are always just one step ahead, always playing catch-up. is that true or not? >> to a degree. i think there's, you know, there's 70% of cyberattacks don't go publicly reported. i think the challenge that we have here is that there's increased vigilance, there's
also an increased need for protocols. there is also simple things. you know, just making sure that stupid things don't happen inside of the workplace. like you get a strange e-mail that has something that's kind of -- ashley: don't open it. >> don't open it. ashley: basic stuff. >> the basic stuff you talk about. but the infrastructure and the backbone security protocols these companies should be thinking about, that is kind of the groundwork that they really need to be laying for going into the 2020s because this is the challenge now. the further challenge is going to be when they have actually ripped all of your internal corporate data, and you find yourself without a company anymore. ashley: sobering thought. oz sultan, thanks for being here. so important. certainly not the last we have heard of this issue for sure. thank you. the two big stories we're watching for you, of course, president trump meeting right now with congressional leaders about the funding of the border wall. we are told we may hear from the president after that meeting, so stay tuned. of course, we are following
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>> ashley, you're better. stu varney comes at me with a sledgehammer. no matter how good the numbers, my good friend stuart, we have known each other 20 years, you're much more even keel. so i really like that approach. i thank you for it. ashley: you heard it here. larry kudlow says i'm better than stu. that said, never fear, stu is back on monday. boy, did he miss a busy day today. liz: hearing from stuart. has his eyes on you. text message. i'm kidding. ashley: my goodness. anyway, stu will be back on monday. look at this market.
the dow up 645 points. thank you to fed chair jay powell in part. a strong jobs report gave a great start to the trading day. guess what. coming up to noon. who comes up at noon? liz: who? ashley: one and only neil cavuto. neil: thank you my friend. we had 29 down components yesterday. now verizon only one down, others pretty much up. this is from the much better than expected job news. jay powell sounding friendly. edward lawrence with ongoing talk to stop a government shut down dragging much longer. good luck with that. hey, ed. reporter: lawmakers are here. a stunning number out of the jobs report. 312,000 jobs created in december, blowing away estimates of 177,000. the largest increase in h