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tv   Cavuto Coast to Coast  FOX Business  February 18, 2019 12:00pm-2:00pm EST

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could make you laugh. convert the opponents with humor. brilliant communication. what a way to remember ronald reagan on president's day 2019. liz: really fun. stuart: connell mcshane in for neil. connell: i'm connell mcshane filling in for neil. u.s. markets are closed we have busy two hours president facing backlash over the declaration afterings in emergency. blake burman at the white house. reporter: starting the threat for a lawsuit pile up. not sure if you could hear that
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loud speaker in the background. that is the aclu. they are gathering here in north side of the white house, to protest president's declaration of the national emergency. aclu is one of the folks filing a lawsuit. attorney general of california, javier becerra said other states will join in the lawsuit. critics of president, some of them gained some steam, or gained some legal ammunition from some comments that the president made when he introduced his declaration of a national emergency on the rose garden. at one point the president said following declaring the emergency. i didn't need to do this but i would rather do it much faster. the president also predicted lower courts would rule against him. it would make its way up to the supreme court. the white house a little while ago defending that the rose garden comments in their view were not a set back. her is mercedes schlapp,
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director of strategic communication. >> we know realities of judicial activism as you see some times with the ninth circuit for instance. at the same time the president didn't want to have to choose this route because he wanted to see if congress would choose a better deal. reporter: white house still feels, connell, they are on sound legal footing with this one. presumably dig into all the legalities in upcoming day or two once these lawsuits start to get filed. connell: aclu chapter of blake burman fan club making its presence known. reporter: couple hundred of them. big loud speaker. connell: we could hear. blake, thank you. we're getting into more detail. former bush 43 lawsuits, which the president himself expected.
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do you think this drags on longer period of time, or gets expedited in the courts? >> i think executive order that president trump issue, it was called the muslim ban, the travel ban. restricting number of refugees coming into the united states. it was frozen fairly quickly of days being issued. over a year before the supreme court ultimately sided with the trump administration on a 5-4 vote. maybe over the years expedited. connell: interesting political dynamic to explain to the american people, you declared a emergency which took a while to be declared. that emergency going on for a year while being decided in the courts. somebody will make an argument is it really an emergency if we all can wait this long? >> that is the big question to begin with. if it is an emergency if you did political wrangling with congress before declaring it so he did this with eye on 2020. he can show supporters i come
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through. i worked with congress. we have to send it to the white house whether we send it through. senators find themselves in. a lot of them before this whole thing went down. we don't want to set this kind of a precedent. >> right. connell: if you have to go go on the precedent and vote is there more political risk on pub must be side, voting with president or backing him or voting against. >> depend on individual member. leader of senate, mcconnell who i used to work for saying for weeks he didn't want to pursue a national emergency. everyone has to make their own decision in terms of what the supporters want. we have to remember that republicans have been split on issue a long time. on george w. bush. we wanted to have issue taking
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both sides. already we've seen nancy pelosi saying maybe a democratic president in the future would issue a national emergency about guns. connell: exactly. people brought up climate change, other issues. >> right. connell: whatever issue is important to them. you have to be careful kind of what you wish for. plus a number of republicans went after president obama for his use of executive powers, executive authorities. those were not emergencies. they're still on the record saying no, you're going too far here. >> expanding the executive branch is a real problem with both parties. whoever's guy in the party doesn't want to con from the. i think it's a real problem. connell: does the president win this in the end or to your point it isn't about that? >> he wins one way or another. if it gets frozen he has an election talking point. mobilizing his base will be one of his main strategies for 2020. connell: from purely political standpoint the longer it drags on, if it drags on into 2020 president makes it an issue.
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you're probably right about that. good to see you. >> thank you. connell: anneke green. one other part of this, it will be interesting to see how much the president makes of it, economic optimism. markets, corporate earnings, all that is up. will that be a secret weapon for the president rather than immigration as we head into 2020? small business entrepreneurship council president karen carry began joins us now from washington -- kerrigan. if you look in your neck. woods are are there warning signals in some surveys. what is going on with the economy, do you think. >> the economy is very strong. look at latest optimism numbers. lots of job opportunities as we've seen. there is some strength in the economy. there, has been a littledown tick if you will with small business optimism, surveys
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coming out recently. where they are in terms of optimism is still above, the historical average. things are good. you're right, there are uncertainties, there are some issues. so the business community does want the president, wants progress on some issues, that will fuel this optimism an growth in the economy. connell: what are you referring to? at beginning was tax cuts, deregulation. if anything from reports over the weekend there is more deregulation to come from this administration. >> there is a host of issues. from the small business perspective one of the big issues is health insurance cost and cost of health care coverage. president has done a lot on regulatory side will lower the cost and produce more competition in the health insurance market but there will be lag time on that. for example, there are good bipartisan bills that will have immediate impact on cost of health insurance, refeeling,
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extending moratorium on health insurance tax. access to capital issues is another big issue for many start-ups, and growth oriented firms. there are bipartisan bills that would address that issue. and tax simplification. obviously you know, we did receive some tax relief. it is temporary. i wouldn't say necessarily that that simplified the tax code. connell: right. >> there are opportunities from a bipartisan perspective on tax simplification. we need to continue, policies need to continue to fuel the momentum that we're experiencing other issues. trade front. connell: china front, what are you rooting for here? deal at any cost or right type of deal? market wise, we talk to market investors all the time, just seems people are rooting to get this thing out of the way. sometimes you get out of the way you don't get a great deal, you
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have to revisit not too far down the line with china. >> details matter from a small business perspective. they do dominate trade in all these countries. 80, 85 of businesses that trade to china, mexico, canada, have 50 employees or less. intellectual property is a key issue, right? getting the chinese to address that, to put together a framework. actually mean it, that would mean a lot for entrepeneurs and small businesses. i think it would be really a great place to start this obviously other issues, but intellectual property is huge. big issue. tough issue. may take a while. they're still talking apparently this week, karen. >> thank you, connell. connell: the president has a big speech today. we've been talking about it on fox business. will go after socialism. will slam socialism as a concept while speaking about the crisis unfolding in venezuela. that is the 4:00 p.m. eastern hour.
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we're on "after the bell," cover the president's speech on venezuela and socialism. later today. we'll be right back. i can't tell you who i am or what i witnessed, but i can tell you liberty mutual customized my car insurance so i only pay for what i need. oh no, no, no, no, no, no, no... only pay for what you need. ♪ liberty. liberty. liberty. liberty. ♪ state of the art technologyt makes it brilliant. the visionary lexus nx. lease the 2019 nx 300 for $359 a month for 36 months. experience amazing at your lexus dealer.
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connell: get to the 2020 race for president now. some of the democratic hopefuls are spread out across the country on president's day, although haven'tly, if they haven't already will have to pass through the state of new hampshire. we go to political reporter paul steinhaeuser in new hampshire. he spoke by the way to cory booker a short time ago. he has been spending a lot of time getting around your state. paul, what is the buzz around, what is it like cory booker? >> i have to say he had a really good rollout. he is wrapping up today. large crowds and enthusiasm. we know he has a great orator.
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he has the gift of gab, but had really good interaction with a lot of new hampshire voters. he is building up pretty strong organization here. a good rollout for him. also kirsten gillibrand here as well, campaigning for three straight days. connell had. pretty good rollout. they're all coming here. bumper-to-bumper says, kamala harris and amy klobuchar coming here. we have the primary a year away. connell: a year away. you're used to it. gillibrand went to dartmouth. knows the area. harris seemed to have a lot of enthusiasm, president said as much announced candidacy, elizabeth warren says neighboring state. obviously had issues here the last few months. then, gillibrand. if those are the four, throwing klobuchar, where are things
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stacking up in terms of crowds, buzz, conversation in new hampshire? >> there is a lot of buzz here. democrats in the state are energized. they're ready to vote. they're excited to see the candidates come here. they're asking pretty tough questions though about a lot of issues, green new deal, medicare for all, opioid crisis. throw in one other name there, bernie sanders. reported for fox news last week he may be jumping in as early as this week or next week. for sanders who won here in '16, beating hillary clinton pretty badly in the primary, warren from neighboring massachusetts, must-win state for those two. for the others they have to place pretty well, connell. we'll see lot of candidates between now and next year. connell: everyone waiting to see what biden decides i would think? >> that is hovering overall. joe biden, look at any poll, connell, here in new hampshire, nationwide, joe biden still at the top of the list.
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why? he has the name recognition. everybody knows biden. my sources tell me biden doesn't feel the rush to jump in. he has the to raise money. he didn't do very good job in 2018. connell: paul, before we let you go, get a sense whether there, new hampshire known for years as independent-minded state, what have you, any sense among the electorate, that they're worried about the democrats going economic issues too far to the left, for biden, klobuchar or mike bloomberg? >> that is a good point. progressive nation here in new hampshire is on fire. there are plenty of moderates. independents, 40% of the electorate get to vote in either primary. there is lane for moderate. bloomberg was up here campaigning. we'll see what biden does. we have john delaney, former congressman coming up here every other week. he is is a moderate.
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there is definitely room for a moderate in new hampshire. connell: we have a year to go. maybe we'll have you 20 more times. paul, thank you up in new hampshire. >> you got it. connell: doug schoen is here with us. he is advising the former mayor of new york city. >> connell, good to see you. connell: good to see you. are you here to tell you the mayor will run? what is the deal? >> the mayor hasn't made a decision. he is weighing possibilities with paul talked about. it is not easy decision. connell: what is the holeup, what is kind of grappling with? >> he is grappling with the question, first, can he win? second, as a moderate, can he make a real impact in the primary. and third, is his vice best heard as a candidate or outside the process. elected 21 of 24 candidates he backed for the house and there are those on frankly the republican side, who believe
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bloomberg made the difference with the democrats winning the house. connell: talk about that point. we did a segment on it last week. you would know as much or anyone on. if mayor bloomberg is prepared to spend 500 million plus, say -- >> i don't know that he is prepared to do that, but i don't believe his voice will be silent, whatever happens. connell: say he is prepared to spend a lot of money. is he more of an impactful factor in the 2020 race as a non-candidate than as a candidate potentially? >> i don't know. depends how the field shakes out. whether mayor bloomberg feels comfortable in a party to the left of him. he feels, he does not change positions based on the polls or circumstances. liberal or social issues. connell: far to the left too. >> he is on things like the green new deal. said he has doubts about that he is a capitalist.
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and probably among the most successful in the world. he is not a socialist. so, what if biden runs, does that matter? >> i think appealing to the same constituency. the mayor made clear. this is very personal decision, whether joe biden runs or not, will not necessarily directly impact his decision. connell: will be interesting to see. are you surprised biden waited this long to get? paul's point, name recognition? >> i get carl or paul's point. i read the piece in the "washington post" this morning, which suggested biden hadn't made his mind up. more time goes by i am skeptical whether biden whether he runs. candidates take this much time to run, reminds me of ed muskie in 1972. connell: going back a while. they're both old, no way around it, bloomberg and.
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>> ronald reagan as president. connell: they would be older than both. >> i understand but we certainly have a history of people in their 70s, serving and serving vigorously. i have no doubt about biden's or bloomberg's commitment or ultimate ability to serve. connell: before you go, doug, get you thought, very, very sad news over the weekend, someone we both know, especially in your business, pat caddell, helped jimmy carter get elected. contributed here at fox died at age of 68. how do you remember pat caddell. >> i remember him two-ways. the guy who invented business we're in. he created modern political consulting. connell: is that right? >> connell, i have to say somebody who appeared regularly on tv with him, pat and pat alone who predicted on this network that donald trump would be elected president in 2016. he was also, a, i can say this, for those who saw him as a gruff
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guy, he was a warm family man. leaves three grandchildren, who were young. i know them all. his greatest accomplishment a loving and doting grandfather would do anything nor his grand children. proud to call him, friend, colleague, ultimately, despite our similarity in age, weigh as as -- he was a great mentor. connell: definitely will be missed. he will. >> he will be missed by us all. connell: definitely. we'll be right back. woman: friction points, those obstacles that limit a company's growth.
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>> the city was paying for those jobs. if frankly we were willing to give amazon three, willing to give away three billion dollars for this deal, we could invest those $3 billion in our district ourselves we wanted to. hire out more teachers. fix our subways. put a lot of people to work for the money if we wanted to. >> that $3 billion go back in tax incentives only after we were getting jobs. >> there is not $3 billion in money anywhere, correct. >> exactly. connell: all right. the battle over amazon pitting progressives against i guess more establishment type figures, progressives against progressives. however you want to say it. funny he is defending all of this. charlie gasparino, we tried to talk about this last week, not hard to explain. that $3 billion aoc says is pot of money. >> she has done something quite remarkable. she makes comrade bill de blasio sound sane. be real clear here. you don't give someone money. tax incentives if you create the
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jobs. tax incentives -- i'm not for this corporate welfare. connell: amazon keeping its own money. >> not what she is saying. just, half of me says, we give her way too much airtime because, because she is so dumb when it comes to economics, when it comes to, this is someone who is this dumb risen this high in the democratic party that we have to expose how completely off her rocker. connell: whatever you describe -- >> i don't mean, i don't mean, she probably did very well s.a.t.s, i'm not saying dumb in that fashion. dumb in terms of knowledge, she really doesn't understand basic economics and basics way government works especially on this issue. you don't give the company money. tax incentive to create jobs, you get the money. aka, if you don't, what happened -- connell: foxconn. >> and ge in massachusetts. connell: thinking of wisconsin. >> if you reverse, don't
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buildout the plants, create the jobs, guess what? you have to give the money back, if you get the money got to give it back. it is, if you collected tax break, you have to repay it in some way just whole thing, doesn't make any sense. i'll tell you, one of the fascinating things about the amazon story how it has imploded the democratic party in many ways. there is such an, when comrade bill de blasio thinks, that, that you're too far to the left, you are really far to the left. connell: right. >> it just shows -- connell: he was blaming the company for all of this. >> he tried to blame the company, he was trying to have it both ways. reality is this, andrew cuomo, and who i know and personally like, he is more moderate democrat, comrade bill de blasio who is a progressive didn't stick up for amazon. they really wanted this job in the face of loony tunes like
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alexandria ocasio-cortez and the rest of them beating the drums. they should have been on tv every day saying -- connell: that is fair. a little more cuomo than de blasio certainly but i think, i don't know anybody thought necessarily amazon would -- >> listen, i think, listen, most presidential elections turn on economics. barack obama was, in 2008, when he won. he was an economic message and financial crisis. mitt romney tried to reverse that in 2016 is that you haven't done much better -- connell: 2012. >> 2012, i'm sorry, couldn't do it. president trump turned the tables on the democrats, said forgotten, forgotten masses out there, white working-class people have not fared very well because of a lot of economic issues, trade. he was able to frame it that way. it is going to be interesting in 2020, because i think the economic issue it will turn on is socialism. connell: president is trying to do that literally today. >> he should, he should because it resonates.
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i don't think the majority of people in this country whether they're democrat or republican, even progressives want socialism. i don't think that president obama was a socialist. he was a progressive, wasn't a socialist. connell: ran data on him. capitalism is still more popular than socialism. >> if he can do that, it will be an interesting economic argument. will expose bernie sanders as not the nice old man he is is. rabid socialist. socialism killed people, destroyed people. capitalism has done more to create wealth even the catholic church. i'm just telling you, no organized religion has done more than capitalism. that is true. that is true. it created, taken masses and masses of people out of poverty. that is what it does. it does that very well. it has, makes mistakes. there have been flaws along the way but i'm telling you, this is a worthy debate for to us have. connell: depends, we talk about this, depends who the democrats nominate. that is why it matters. it's a choice at the end.
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>> if it is bidens we have a story on foxbusiness.com, about biden, running for a long time. my one thing about biden because i just heard dow shown, why does he still need to make up his mind? now is the time to lock down the donor base. connell: interesting he hasn't announced yet. >> maybe he doesn't want to do it. connell: charlie. thank you. we'll be back later on in the show. now we talked about that speech that the president is going to make later today, the whole idea is to to after socialism. about the crisis unfolding in venezuela. those are the terms that president trump will put it under. let's get to the heritage foundation on that. anna, to charlie's point, you will put this argument in place before 2020. the cause of course is venezuela but it is capitalism versus socialism and the white house or in the president's mind, right? >> that is exactly how they're framing it, right? it is this, it is a stark divide
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between the prosperity that capitalism brings and the clear, the downsides of socialism. we're experiencing right now with, we're experiencing with venezuela and venezuela of course, being governed by a narco-dictatorship. that is clearly the path socialism gives you. connell: on venezuela, we're told when the president speaks this afternoon, 4:00 p.m. eastern time hour, we'll carry it, he is going to say a few things, not a lot of surprises in what we've been told. he will talk about strong support for juan guaido in venezuela. then he will say something we understand whole idea of what a path towards democracy is, white house term is irreversible. we've gone down this path. it is not turning around. what do you make of that? >> for the last two years, folks have been ignoring president trump's strong venezuela policy over the last two years. this is not something sporadic or only going on the past
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several years. weeks. for the last two weeks, sanctioning corrupt government officials, sanctioning corrupt people in maduro's regime. i think the administration is correct. we're at an irreversible point. we're at a point 50 countries recognize juan guaido as the legitimate president of venezuela. this is, we're at an unprecedented point in history right now. we're absolutely living something remarkable. connell: have we passed, to that point, passed so-called tipping point where it is pretty much a done deal? just a matter of when, not if on the new government? >> it is so, i think it is, only been three weeks that guaido officially assumed the role of this the legitimate president. chavez and his successor maduro have been in power 20 years. they control strong levers of power within the country. it is going to take times, but
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it is irreversible right now at this point. what we noticed, what we saw yesterday, maduro and the border of colombia. there is massive amounts of foreign assistance awaiting to relief the humanitarian crisis. connell: that is in, right? >> once that gets in, once levers of power u.s. government has, we're at an irreversible point. connell: so then the leaders, not maduro anybody affiliated they kind of get out town? once the aid is in, is that the thinking or analysis? >> issue is, maduro right now has the option to leave the country. maduro can hop on a jumbo jet, go to cuba, russia, wherever he wants. he can take the money he has stolen and leave. he can hand power over at this point. connell: he won't have the option. >> that is what trump is saying. at that option that will leave the table. maduro needs to recognize, his
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options are looking pretty good but he will be on the wrong side of the equation. connell: at some point you're done, we give you enough time, at some time to make the call. anna, thank you. cover the president's speech later today. >> thank you. connell: we'll switch gears a bit and talk about videogames. i'm sure you all heard of "fortnite." is it taking over this video game industry? and the model it uses, can play for free? is that a new competitor for the big guys in the gaming industry? we'll get into that when we come back on "cavuto: coast to coast." we'll be right back. $4.95. hydroponic farms. robotic arms. ♪ $4.95. delivery drones
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♪ connell: "fortnite" in case you haven't heard yet has been really shaking up the videogame industry, kind of changing the model how this whole industry works. it's a game that earnings or brought in a massive $2.4 billion in revenue last
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year. we have tech analyst here with me in studio, to talk about how this changes the game, so to speak for everybody else. so we don't go south to buy games anymore. we play them for free, buy stuff in the app, right? >> a lot of people still go out and buy games. "red dead redemption ii" came out last fall sold a boatload of companies. installing games free. get install bases playing for free. they maintain the audience, spending $5 for a hat, something ridiculous. eventually overtime you make much more than you would if you sold them a copy. connell: people's addictions. if you play "fortnite," so into it, and you need, honestly, probably not as informed as i should be, i don't know what you need, you need something to make you a better player or more effective player more likely to pay for it because you need it. >> there is controversy there. a lot of companies tried that, oh, you pay money get an advantage. there has been blowback. electronic arts saw a huge hit to the stock last year when they
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tried to do that in their game. primarily success, just visual customization, vanity items. is what they are called. that is where they're making money. connell: are the big guys ready for competition, electronic arts, activision, are they ready for this to keep up with someone who can start it off as a one-off game? >> big guys are jumping into it. ea, for example, launched a couple weeks ago a game called apex legends, up to 25 million players right now, catching up to games like "fortnite" this is big publisher, big name coming out of the publisher. they can throw resources into the launch to make sure it's a huge deal to, change the space. indy developer, you don't really know. connell: got to be able to adjust, especially any kind of digital industry. good to see you, russ. >> good to see you. connell: moment we get into detail. payless closing down all of its
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stores. a kind of a wider message in that? how does retail look overall? we'll right back on "cavuto: coast to coast". - in a crossfit gym, we're really engaged with
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connell: eight straight weeks of down, with the nasdaq, out of bear market territory. jimmy lee is with us. jimmy, talk a little bit of tech. i thought technology was so 2018, right? here in 2019, we have a nice rally underway as this back to being the leadership sector? what do you think? >> i think it will be, connell. 2018 was interesting though, if you didn't own the fang names, market was up at the highs last year you wouldn't have made a lot of money. i like the run this year. we've had recovery in those names, the names are still down off the top a lot. i think tech is sector that will do well in 2019. connell: why? we'll talk as i said before the last break, retail environment, which gets into macroeconomic,
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optimism or concern, what drives tech in your mind? >> i've been bullish about the u.s. economy for a while. more than most i think. and you know, i think the biggest obstacle last year, in the decline was, the fed. so if the fed is on hold, we get a trade deal, inflation stays low. we create jobs, i don't know how earnings won't be good? i don't know how we don't set new highs in 2019. i said this the market was bouncing off the lows. i still believe that. the overall economy helps tech do better. connell: going through the list, i say okay, i can check those off, the fed would be a very big surprise if we didn't say as jay powell says. fed is on board. second question is trade. i know a lot of people are assuming we'll get a deal. china needs to make a deal. president trump needs to make a deal. that is it not one yet. that is fly in the ointment, right? >> there is uncertainty i
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definitely think we'll get a deal at some time, hopefully soon. the president wants to get reelected, he wants the stock market to be up. white house understands the trade issues are a big deal as far as the stock market as well, as the overall economy worldwide. i think we'll get a deal. i think it will be a tailwind when it was a headwind last couple years. connell: look at last couple minutes at actual stocks. you said the fang flims were the place to be. what about this year? is that the point earlier inside the technology space? what is the most attractive area you look at? >> let me correct myself. i don't think you need to be concentrated in fang. market weighted indexes concentrating on biggest cap stocks are something to be aware of. i think a diversified portfolio is good. in tech we also like biotech. a good way to play 2019, core defensive sectors, buy quality
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earnings, but surround ourself, with the growth sectors, tech, like i said, we're overweight others as well. barbell strategy, thank you, jimmy lee. >> thank you. connell: you know the plan, payless, started a liquidation sale. it is planning to close down 2100 stores in the united states and puerto rico. any kind of a wider sign for retail business there? former chairman of saks, is with us here in the studio. there is a long way, steve, from saks to payless i understand that, but idea of retail and consumer is. there we had lot of people questioning whether the consumer can hang in there? you're positive, right? >> i'm positive on the consumer. the holiday season was very healthy. mastercard post-spending numbers, the holiday season was 4% range. january grew at 4%. national retail federation
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forecast, for 19 '3.8 to 4% i think that is pretty solid growth. connell: government came out with retail sales figures, people were freaking out it was nowhere near expectations. does that give awe concern at least. stuart: i'm looking at mastercard numbers, based on their data, based on algorithms they have with all other forms of payment. they were healthy. there were sceptics out there. with the government shutdown going on. survey data, have the reforecasts in terms of they come back with their adjustments, first adjustment, second adjustment. i wouldn't be surprised to see it go up. they forecast the internet was down 4%. amazon reported plus 20. they're half the internet. seem as little bit odd to me in terms of actually was going on. i see a healthier environment for the consumer. connell: if that was confirmed, say the number was accurate, there wasn't a shutdown, didn't
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kind of distort it, came back confirmed, it would concern but you don't think that is what the environment really is like? >> i don't think that is the environment. would it concerned me if we saw it decline? would concern me if we saw holiday season declined. but look at retailers, target four to 5% type growth. walmart is coming out tomorrow. i would expect to see positive numbers in 3 1/2, 4%, type of growth for them. broadly top-line sales environment. connell: talk to jimmy about trade. we talk to everybody seems like about trade. how does that work into the psyche of consumers? u.s. has inmade a trade deal with china. i will not buy something at saks? >> i don't think the consumer thinking about this they're looking how much i am paying for an item. connell: sure. >> 10% tariffs, a lot of these goods, big retailers push it off to the suppliers or absorb the increase. connell: we were talking last week. people get confused. the president talks about it in
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a strange way, money coming from china with the tariffs. chinese companies can absorb it or u.s. companies if they don't absorb it. so far -- >> the so far the consumer hasn't seen that much after increase. prices on packaged good companies, starting to go up. you're starting to see some retail price is increase. if you had a 25% tariff you will see real issues with the consumer. remember 2/3 of the u.s. economy is the consumer. retail staying healthy is very important to seeing this overall economy staying strong. connell: it is kind of interesting debate or discussion. president might have decision to make on first of march. whether to go from 10 to 25. to cut a deal. that seems like tough to do in this amount of time or just extend that deadline and keep it at 10. sounds like you're saying it's a big deal. if he stays at 10 he may say i
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have to turn the screws on china. that -- >> that is a big risk for retail environment or consumer. everything predicated on the consumer staying healthy. that 4% type of growth that the national retail federation forecasts is all based upon a stable economic and external environment. we start to get some these things, political things coming into play like the tariffs. connell: yeah. >> that would be very concerned about that. connell: let me ask you one final question. is that the only thing, because you have a positive view of the economy and retail sector, is that the only thing these tariffs slow us down? >> i think earnings in the end in terms of the health -- connell: that would have big impact on earnings? >> tariffs is one factor. other factors in play. input costs, wages are growing. transportation costs. costs of digital are growing. that is putting margin pressure. i'm expecting to margin pressure on retailers as they see reports come out this quarter.
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external government types of actions like the tariffs are a real concern for the consumer. connell: move from 10 to 25. steve, good to see you. steve sadouve used to be the chairman at saks. on "cavuto: coast to coast" we'll get back to the border fight as courts get involved. ed rollins among others next hour. we'll be right back. ♪ i switched to liberty mutual
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former department of homeland security consultant under bush 43, mustafa, joining us to start this hour. why don't you kind of start us off on the discussion we are having. everybody knew and now we are going to get to this phase where this whole thing goes to the courts. how does it play out politically? >> look, presidents have declared emergencies in the past. george w. bush did it right after 9/11. president obama did it for h1n 1, a virus that was affecting the entire world and some presidents have done it when it comes to sanctions. but president trump is doing it to deliver on a campaign promise. that's even half of a campaign promise. he had said he would build a wall and mexico would pay for it and now he wants the americans to pay for it and he wants, you know, to take the power away from the congress. the congress has the power of the purse and the president wants to declare a national emergency to encroach on the
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congress' power. that is dangerous. i think he's going to lose in the courts and he's going to create a very dangerous precedent in doing so. connell: on the dangerous precedent part, there have been some republicans who have brought up that point. sn senator lamar alexander has said they don't support, they think the president went too far. is there a political price to pay in his own party or is it worth it with the idea that as you know, he's appealing to his base in making this move. >> i think there is certainly logic to the argument of people saying if president trump declares a national emergency, like he's done, democrats will turn around and do the same thing when they get to power. at the same time, does anyone really think the democrats down the road when they iven tanevit will get power will say we owe republicans one, he was pretty reasonable in not declaring that emergency so we're not going to do that now? of course not. democrats when they do get power are going to do whatever's necessary. they will push executive orders, in some cases national emergencies, regardless of what trump did or did not do in the
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situation. i understand also the arguments from trump's team saying we have to do this right now while we have the power and it's certainly not unprecedented to do this. president obama himself passed 276 executive orders -- connell: i guess the question is, whether this case falls into that, that this is, you know, a little odd in terms of the types of emergencies that have been declared in the past. as you said, it's not about economic sanctions, for example, which many of them are. >> yes. absolutely. look, this is going into a new territory. this is basically saying i didn't get what i want out of congress, and congress has the power of the purse and the fundamental thing about a democracy is the balance of power between the judiciary, the congress and the executive branch. when the executive branch starts to encroach into one of the other branches' power, we have to ask ourselves if people that are supporting it, are they letting their partisanship get in the way of their patriotism
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because our democracy is held in high esteem around the world because we have that balance of power. we elected donald j. trump as the president of the united states. we didn't elect him as the king. we don't want to let him become the king. connell: how would you respond? that's been the charge. how do you respond to that accusation, essentially? >> i think some of the blame definitely lies on republicans. it's fair to say in ways they are being hypocritical to call out president trump for executive overreach and turn around and use that same overreach when it benefits them. that's a fair accusation to make. to a certain extent, playing into 2020, how is this going to look. i think president trump is willing to shoulder some of those accusations in order to keep the base happy. connell: let me follow up on that point. i'm reading between the lines a little but it sounds like you, as someone who normally supports republicans, are a little bit uncomfortable with this but you are making the political argument that it's worth it? >> i think me personally, i see what president trump is trying
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to do. i understand also that there probably is hypocrisy there in ways republicans are acting and looking at the broader scheme, i imagine republicans that are supporting this are trying to view 2020 in the bigger picture and realizing re-election odds do go down if there's no sort of movement on the wall. going to republican voters in 2020 and saying well, democrats stonewalled, weren't willing to compromise so we aren't getting the wall, that's not good enough. connell: this is obviously pure politics but that's where we are right now. we will have legal analysis. we had plenty of legal analysis earlier. to that point, if this drags on, some people predict it will drag on to 2020, it does give the president a talking point to keep talking about this wall well into his re-election campaign which might help him, right? >> well, look, i think that, you know, president trump, if you just looked at just analysis of it, hasn't really wanted to build a wall. he wanted the issue because republicans controlled the house, the senate and the presidency for two years and
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even in the house that they controlled fully, didn't have a bill for the wall up until the very last bill in a lame duck session. they really didn't want the wall. they just want the issue. president trump wants to continue to go out and use this as a political thing, but we have to -- our democracy is more valuable than any one person's politics. connell: we still have the issue, for sure. we will keep talking about it. thanks to both of you. appreciate you coming on. another issue we keep covering here is trade, of course. the president says there's been a lot of progress made on trade in terms of getting a deal with china. so let's get to edward lawrence, who has been covering this forever and ever, back to the dynasties. what's the latest you are hearing on china trade? reporter: exactly. back when i had hair, right? at this moment, just learned off the chinese schedule that the trade negotiations will be thursday and friday here in washington, d.c. president donald trump gave the marching orders to everyone connected with his
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administration and trade in a meeting over the weekend. the president was updated on how the talks went and then he made the decision on how to move forward. the u.s. trade representative robert lighthizer wants to make sure that china protects intellectual property, including specific enforcement. the chinese balked at making those changes all at once. they want a slower pace to any structural changes. experts say the chinese have underestimated this president's resolve. >> in this meeting, this is china's last chance, it's the last chance for china to show that they are serious about making a deal. reporter: also last night, the commerce department submitted their report on the effects of tariffs on autos and auto parts coming into the united states. the president has said he's looking to up the tariffs to 25% on cars and up to 25% on parts coming into the u.s. the european union says it expects the president to honor the handshake agreement and not move forward with tariffs while negotiating. the eu trade negotiators say they will be here early next
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month. connell? connell: thank you, edward lawrence in d.c. for us. president trump when it comes to china has said any deal he would make with china would be seen by the democrats as a bad deal. so it was interesting he brought up the idea of involving chuck schumer, nancy pelosi, the democratic leadership, in the discussions. former reagan white house political adviser ed rollins with us in studio. good to see you. >> my pleasure. connell: you think that's shrewd political move by this president to say come on in? >> no, i think it would be disastrous. it would undo the very careful negotiations that have been going on for months and months and months. this deal is not done yet. certainly the congress has a right, will have the right to deal with this once it's finished, but to put schumer in there and pelosi in there, and the truth of the matter is, it's not just leadership of the democrats, it's got to be republicans involved in it, too, particularly the senate, and only the two committees that have say in this is the ways and means committee and the finance but right now, the deal itself has to be made --
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connell: get it done on the white house side. >> i think the relationships are so poor between schumer, pelosi and the president all you would do is disrupt it and probably not have a deal. connell: it would be a sign if that did happen there probably wasn't going to be a deal done anyway. >> absolutely. connell: what's the risk politically for the president in the near term, do you think? getting no deal with china or signing a deal that's a bad deal that allows some democrats, i'm thinking of senator sherrod brown or somebody, to really go after him in 2020 and say you weren't tough enough? >> you won't know whether or not it's a bad deal for some period of time. no deal right now, as the president articulates carefully, could get out of it okay but the bottom line is we need a deal desperately. connell: we do or they do or both? >> both of us do. i think that's why it's the time you strike deals. to a certain extent, this economy is the critical part of this president getting re-elected and everything that makes the economy stronger is steps he needs to take. connell: he has that argument and probably, i mean, everybody assumes, who knows, by the way,
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how the stock market reacts to any kind of deal. it may have priced it in already and could sell on the news. it would seems that would be the motivation for the president to get something signed in the near term, he could say look at the stock market, it loves what i've done and now i'm into 2020. >> equally important, he's always wanted to renegotiate with the chinese more so than any other group. the chinese have not played fair. connell: he has gotten people on his side on that. >> i think he does. connell: think about the way it started. >> i think the theft of intellectual property that's gone on for a long period of time, it's time for us to say no. connell: ever think there would be so many republicans -- >> supporting tariffs? absolutely not. connell: it is surprising. >> i never thought i would see republicans in favor of deficits, either. the office of management and budget saying deficits don't matter, kind of contrary to my 50 years in politics. connell: everybody looks for bipartisanship. there it is. they agree nobody cares about debt and deficits. i'm sure you heard our discussion, you heard all the
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discussions. let me get your quick view on the declaration of a national emergency from you. what did you think of the president's move? >> he has to do it. you're not going to get a wall otherwise. you haven't had a new immigration bill since 1986, when i was in the white house. before you can make any steps on anything else, you have to have border security. i think it's his last chance. i think he has to do it. it gets blocked by the courts, whathave you, then obviously you revisit it. i think this will go on the supreme court. connell: probably will. he thinks he has a chance to win there. >> i hope he does. it's now our court. we'll see. connell: they have been able to turn some to his side. there have been assumptions going into the debate that this would get blocked. if it goes to the supreme court you have a better chance. >> the court needs to decide what is congress' role and what is the president's role. connell: always good to see you. appreciate that. we will get back to 2020 when we continue in this crowded democratic field that gets more and more crowded by the day. one potentially emerging as the
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front-runner. we will talk about that when we continue. 4:00 p.m. eastern when melissa joins me for "after the bell" we will have live coverage of the president's speech on venezuela and socialism versus communism or socialism versus capitalism. that's 4:00 p.m. eastern. don't go away. we'll be right back. that have made the rx the, crleading luxury suvhnology of all time. lease the 2019 rx 350 for $449 a month for 36 months. experience amazing at your lexus dealer.
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connell: more politics for you. there's been a lot of talk that kamala harris may be office to the fastest start among democrats ready for the 2020 race, so hillary vaughn joins us with the latest on that. reporter: well, this presidents day, candidates running for president are crowding the campaign trail in early voting states over the three-day weekend, senators cory booker
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and kirsten gillibrand introducing themselves to new hampshire voters while senator amy klobuchar campaigned in the first caucus state of iowa. the next door neighbor to her home state of minnesota. senator elizabeth warren went west, hitting the trail in las vegas. but today, the granite state is heating up with candidates. senator kamala harris on the trail right now in concord, new hampshire. harris wrapping up a weekend of campaigning, first, though, in south carolina, where democrat voters asked harris what sets her apart from her opponents and she told them she's a fighter and she intends to win. the latest monmouth poll of 2020 democratic picks for president has harris in third place behind senator bernie sanders and former vice president joe biden, both who have not decided on their own run for president in 2020. so of the candidates that are running now, multiple polls show harris leading the pack and the california senator is cashing in on this momentum, locking down key endorsements in her own home state and also schmoozing with
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high profile donors, hosting packed fund-raisers in los angeles and new york and building up an arsenal of campaign cash. in the 24 hours after harris announced she was running for president, she raised $1.5 million. put it in perspective, that's on pace with what bernie sanders raised in his first 24 hours when he announced his campaign in 2016. connell? connell: hillary vaughn for us in washington. on that note that hillary is reporting on, peter doocy from fox news just ran into cory booker in new hampshire on the campaign trail. they talked about the green new deal. let's take a listen to that. here it is. reporter: how would you pay for all this? it would be so expensive, you know, there's a thing in the "wall street journal" $2,000 an apartment for light bulbs. >> this is the lie that's going on right now. as a guy who's a former mayor that shows you can actually revive your economy and create the future, we environmentally ret pro
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retrofitted or building, and that's a lie being put out that being green and responsible means you have to hurt the economy. a lie. connell: from that to democratic strategist david brown who joins us. let's use those comments as a launching point to a larger conversation. cory booker, i suppose, is saying just because you quote unquote, go green doesn't mean you will bankrupt the city, maybe sometimes that leads to economic growth. that's separate from this actual plan, this green new deal resolution, not a bill, but that's been thrown out there that that would be economically responsible. most of the analysis i have seen said there's no way we can afford this. it's kind of a pipe dream. what do you say? >> well, look, the devil is always in the details. of course, there's a very big difference between how you campaign and how you talk about ideas and really put challenges and issues on the table, then how you govern. what's the old cliche, you campaign in poetry and govern in prose. i thought senator booker's comments were on point in the
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sense that we are facing, most people agree, we are facing a pretty calamitous moment in earth's history in terms of the climate and something has to be done. i would rather have big, bold ideas on the table that we can debate and we should debate them, by the way, than simply say nothing can be done. connell: that is interesting, because you're right, a lot of people agree it's an issue but once you get to the point where you are so bold, you just throw things out that aren't actually possible, just sane analysis says this can't happen this way, what's the point of that? you are starting the conversation at a point where it's easy for the other side to come back and say to you that's nonsense, we can't do that. why not have a more realistic kind of conversation about this, if you think it's an issue? >> yeah, look, i think you are raising an important point because we know this is an incredibly polarizing partisan issue. i wish it wasn't but i think it is, so i take that point. connell: i'm talking specifically in cost, right? >> completely. completely. i have to wonder, too, go back to the era when kennedy said we
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are going to the moon. that seemed like an impossibility and it did come at tremendous cost. i'm never comfortable saying as a country that we can't solve these big problems. i agree with you that for any kind of proposal, yeah, we have got to cost it out. we have to have a real conversation about that. and if we are starting so far apart, let's find a way to move towards the middle. connell: i know joe biden hasn't announced yet, we talked last hour about mike bloomberg, i don't know if he will run. maybe it's amy klobuchar. is there a lane in the democratic primary where someone says yeah, i know these are issues, i agree with you guys that these are, but here's my plan. i have a realistic plan. does that sell or do you have to be on the ledge, or way out on the wing in a primary? >> great question. because this is probably the most diverse field of candidates we have ever had. certainly at least in my lifetime. if you look at exit polls from 2016 in terms of the democratic primary voter, we are also now enjoying an incredibly diverse
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electorate. so i do think there is a path. i think that probably one of the biggest challenges for any candidate right now in this very crowded field is to figure out how they can -- how they can differentiate themselves and chart a path forward, whether or not being moderate on this issue or being more nuanced on this issue will play well in a primary, it's too soon to say. connell: they seem to have calculated it's more of a risk to be considered moderate. like there's less risk in getting out to the left. >> i'm not persuaded on that. i think when you dig into the numbers, certainly you have seen a shift in terms of some democratic primary voters becoming more liberal, but you also see a number of -- connell: candidates think that. maybe they're wrong. you don't think that's the way the campaigns are starting? >> let's see where senator klobuchar is, if joe biden jumps in. part of the play here, a lot of candidates are positioning themselves as fighters, i can beat donald trump and win this election, or the more cory booker style, the aspirational
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hopeful vision for the country. people like senator klobuchar, like senator harris potentially vice president biden, potentially senator brown, i suspect you will see them chart a more nuanced path where they straddle both those frames. i think the question voters will ask is what can you get done in an era of divided government. connell: yeah, you're right. it will be interesting. there will be so many up on the stage, how do you distinguish yourself. thank you. great to see you today. david brown. in a moment, uk lawmakers say facebook needs more regulation. what does that mean here in the united states? what does it mean for the company? we will talk about that. with the market closed today, oil prices hitting their highest level for the year. supply tightening and crude oil's above $56 a barrel. we'll be right back. did you know with vanishing deductible, you can earn $100 off your deductible for every year of safe driving? sing that. ♪ vanishing deductible, you can... ♪
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connell: uk lawmakers are targeting facebook now, saying
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the company needs, you guessed it, more regulation. deirdre bolton on the story from the newsroom. reporter: hey, connell, the era of self-regulation for tech companies should come to an end. this is the finding of a scathing uk government report against facebook. british parliamentary committee released the findings of an 18-month investigation. it criticizes facebook and founder and ceo mark zuckerberg. the report refers to facebook as a digital gangster and claims that facebook knowingly broke data privacy and competition laws, and this uk committee for digital culture media and sport calls for new regulation. there's three key components to the suggested regulations. one is that facebook follow a mandatory code of ethics. second point, the ability to appoint an independent regulator who can sue facebook if necessary. and the third component is the ability to force facebook into handing over data. more frightening perhaps to
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facebook is the uk's finding that facebook uses its market dominance to crush rivals. we have heard this before. it usually doesn't end well for companies. the idea backs up what some say is really the biggest threat to u.s. big tech, a call for them to be broken up. nyu professor scott gallaway openly said on our air that europe and uk will call for the breakup of big tech, as soon as they have all the downside, the privacy concerns and none of the upside, we built it here creation story. the conversation between the uk and facebook certainly continued this week. uk culture secretary jeremy white is going to be meeting in person with mark zuckerberg. worth noting, as you already know, past 52 weeks, facebook down much more than the broader markets. if you look at the charts, the stock is down around 8.5%, s&p 500 has gained a little bit better than 1.5% in that time. back to you. connell: good to see you. thank you very much. let's move on and talk about student loan debt.
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it's obviously an important topic and serious issue for a lot of people as you look at serious delinquency as they call it, hitting $166 billion. on top of that, you have car loans, housing concerns. so we are, i guess we always have been, but now more than ever, maybe, a nation of debt. with that, we brought in the fox business network's jeff flock. first of all, he's sitting down. >> that's news. connell: that was my suggestion. i wanted you to walk around. i'm uncomfortable with you sitting. you are here in new york which is great. always good to see you. this is obviously a big issue, especially for young people getting out of college, student loan debt. maybe we can talk about auto loans as well. >> we were talking, we both had student loans but they were a lot easier to pay off. connell: mine were thousands. >> right, exactly. my daughter has student loans now. two years' worth and grad school. so this contributes, she's
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$100,000 in the hole at the moment. she's still paying that off. people not paying it off. take a look at the numbers. we have a chart, this is the worst it's ever been. in total, there is almost $1.5 trillion worth of student loan debt out there and a lot of it is delinquent. if you look at the percentage of student loan debt that is now delinquent, that has grown from 2003 when it was about 6% to now 11.42%. connell: huge jump. it's a huge jump in that chart. it was one of these, going straight, pretty much straight up. it's almost one of these evergreen stories that we do, like how do you reverse all this? >> and the impacts. we talk about the ability to buy a home. my daughter says i can't buy a home right now. i've got these debt payments. connell: that's the thing. >> the interesting thing, take a look at this chart, apparently if you look at the numbers over time, if you go to college,
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people wonder should i go to college. connell: is it worth it, right. >> it looks like in terms of buying a home, if you go to college, you still have a much better chance of having a home than if you don't go to college. connell: i could see the argument, the case by case argument is viable. for some people, it doesn't make sense. maybe a trade school or something. but on balance, they say, the numbers overall show the higher the education -- >> the game of life. if you ever played that as a kid. you go to college or go right into the work force. connell: you always had too many kids in the car which is the game of real life, too. >> you would be very wealthy if it wasn't for that. connell: you have to get two cars. neil talks about this and i have seen a number of stories about this in recent weeks, auto loans. it's something of an issue. they are extending them now. longer loans. >> that's the big key. you can get a loan for seven, almost eight years now. you know, we do build cars better now. used to be they wouldn't last that long. so there's a plus there. and the numbers are nothing like
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the housing crisis. but it's still, you know, i would argue that it is a bubble that's starting to bubble up. connell: everybody wonders where the next problem is. it's usually not the one that we had but sometimes it's a derivative of that one, something similar. >> you can always live in your car if you lose your house. but if you lose your car -- connell: where do you go? you must be here for the auto show. i googled it and that's next month. >> april. connell: that's when we usually see you. >> i should be back for then. you never know. never want to make commitments. connell: you know the way it works. great to see you. the great jeff flock. he's here in studio, sitting down. get up and walk around. a new push, meantime, for paid family leave what is we will talk about when we continue. maybe an issue that the two parties can actually agree on. some bipartisanship. talk to a senator about that when we continue. ♪ [nondescript dialogue]
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connell: how about this. we have an area where we actually might see some bipartisanship in the congress. the republican senator from louisiana, bill cassidy is trying to develop a paid family leave plan. he joins us now. good to see you. by the way, this is on the media to some extent as well, as we don't cover stories where the two parties might work together maybe as much as we should. we know you guys actually do in some cases. what about this one? how is it all coming together? >> this is something ivanka trump is very interested in and multiple republican senators there. are different proposals on the left but nonetheless, the rationale is if you have a mother who delivers, doesn't have leave through her work, she either has to quit work and lose attachment, go on public assistance or go back to work and the child's not breast fed,
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you don't have the bonding, the health needs of both are not addressed. we are trying to thread that needle, fiscally conservative and taking care of that mom immediately post-delivery. connell: you say there are different proposals on the left. i'm thinking back to the different issues but process of coming together on prison reform, where you saw the sides kind of work out their differences and the president went ahead with that bill. what about here? what's the place you have to come together the most on? i guess it's on the spending, how much money goes into this, fiscal stuff? >> you nailed it, man. connell: it always is, right? you are willing to give a little here, it's an important issue, right, but where's the line? >> we think that if you focus on those who currently do not have access to paid family leave, which will be mothers and fathers below roughly $45,000 a year, they typically don't get that through their work and you give a benefit, six to eight weeks in duration, then you can
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pay for that without raising taxes. on the left, as you might guess, they wish to have a far more generous package, including for those who currently have access to paid family leave through their employer, the taxpayer would take it on and for a longer period. but my thought is if you have a compassionate solution which is not sustainable, that's truly not compassionate. connell: so six to eight weeks, sounds like it's something we should be optimistic about. you think the two sides come together on this? how optimistic are you? >> well, we have to see. right now we know our common ground. what we have to work towards is expanding that common ground. if the left says we want everything we want, and we don't accept taking care of -- on the other hand, you know, there's a lost s lot of sympathy for folks who are lower income, wish to stay home with their family. it's pro-family, pro-baby, pro-united states. connell: before we let you go, we would like to ask you about the big news the last few days,
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the president's declaration of a national emergency. many people in your position are being asked that question. whether you support the president or are worried about the precedent it sets, as some in your party have stated. where do you stand? >> yeah. you nailed it. i totally support the president's need to secure the southern border. i like the fact he is taking the asset forfeiture fund, something i had proposed and now he's doing. in terms of the precedent of declaring a national emergency, that does trouble me. you can imagine a future democratic president doing so to limit, for example, second amendment rights. so i think we need to, as we go forward, sort that balance. connell: would you vote against it then as it stands right now? you were asked to vote on it and i'm sure the president would then work the veto pen on it, i guess. but would you vote against it if you have those concerns? >> so i'm looking forward to -- let me answer that after i have looked at all the issues. it's something i'm studying but
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i am concerned about the precedent. [ speaking simultaneously ] connell: i'm pushing you on this because i want to get you as close to on the record as i can. it sounds like you are a maybe, you're leaning one way or the other? >> i'm not leaning one way or the other. both from the right and the left, people are saying that it is legal. but whether or not we are establishing a precedent that a future activist democratic president would take on, that is what concerns me. connell: so the president doesn't have 100% support yet from you, he's got some work to do? >> the precedent is what concerns me. connell: yeah. in speaking to your colleagues, others are in the same boat or similar boat? >> yeah. you look at what mike lee tweeted. mike lee effectively said it's legal but it is a ceding of power from the congress to the executive and again, what might a future president do with that. i will note, jonathan turley, the liberal lawyer, posted the same sort of thing, i think it's
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on the hill. so there's bipartisan concern about that. connell: last point to try to push you on this. what do you need to know? what information are you waiting for? >> so obviously, i would prefer the congress come up with a solution that would not require this. i understand the president's frustration. but what is the legality, i'm not an attorney. so it is something i reserve the right to research the legality thereof. and that's one thing i will be focused on. secondly, what is the likelihood a president would use this precedent to do something such as unilaterally invoke economy-crippling regulations on climate change or similarly take second amendment rights away from americans and say sue me. that's what bothers me. connell: okay. fair to characterize, undecided still on this issue. precedent is the concern. we will talk to you again about it. thanks for coming on today. >> thank you, connell. connell: as we continue with the
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trump administration pushing some housing reform, up next, what that might mean for home buyers. we'll be right back. ♪ nt ] - hey maya. hey! you still thinking about opening your own shop? every day. i think there are some ways to help keep you on track. and closer to home. edward jones grew to a trillion dollars in assets under care, by thinking about your goals as much as you do.
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connell: all right. when you look at it, you have signs that maybe the trump administration's going to reform
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fannie mae and freddie mac years after the crime, so to speak. we have a former fannie mae executive with us, he's a regular guest on the fox business network. charlie gasparino also joins us once again. charlie, a word about this, for anybody who didn't see it the other day, in the "new york post." >> you're not suggesting he's a criminal. connell: don't you start. we will have enough problems in this segment, already, i have a feeling. so let me start with you, charlie, on your piece in the "post." i felt like it was weeks ago. must have been this morning. >> my writing is that bad. connell: your larger point is that we could repeat the mistakes of the past. >> let's just go back on what fannie and freddie does. banks won't make 30-year fixed rate mortgages. it's not a business any bank would be in because of the obvious, right? who wants to lend someone 30 years at a fixed rate? the interest rate risk, default risk, prepayment risk, way out of hand. so we have two entities, government created one in 1938,
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fannie, i believe and freddie was in i think 1970. they come in and say okay, we will buy, to encourage banks to make these loans, we will buy them off your balance sheet, package them and sell them to investors. connell: which became an issue last time around. your point is all of this is going to blow up again? >> here's the thing. the more they do that, the more they prop up housing values, they create a bubble, they only can do that profitably because they are backed up by the treasury department, and it's such a political boondoggle. all you have to do is go back and look at the scandal and the crazy bureaucrats that ran this place and took lots of money out of it, and made investors a lot of money. >> you are worried about me saying something. >> here's the thing. at some point they are going to blow up because maxine waters and liberal progressives will push them -- connell: financial services committee. what's charlie getting wrong or is he getting anything wrong about the risks of a redo? >> nice to talk to both of you.
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couple things about that. first and foremost, fannie mae and freddie mac exist because they want to make sure there's mortgage credit available in every market, every day. that was really the premise behind it. 30-year fixed is debatable. you are seeing right now big banks are actually offering jumbo 30-year fixed at prices that are more competitive. >> are they fixed? >> yeah, they're fixed. >> it's not -- listen, then why do we need them? >> that's the next point which is you are worried about potentially another rollback of the issue before and taxpayers on the hook. again, really the only issue we really are concerned about is the fact that the government has now looted fannie mae and freddie mac of all their risk capital to the benefit of the treasury department which now takes -- >> which bails them out. >> which puts taxpayers on the hook in a first loss position. connell: while we have time, i want to make sure tim answers this, charlie brought up in the piece. i always thought about this,
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too. they are publicly traded companies as we went through the last crisis, we know all too well why. why, tim, is a quasi-government entity need to be traded in the public markets? what kind of issue does that create, in your view? >> well, that was clearly one of the big problems with fannie mae and freddie mac, this dual purpose. they are private companies, shareholder-owned companies, but with a public mission. that clearly needs to be remedied because -- >> but you don't remedy it by doing what they are probably going to do now, turn it back to the old ways with maybe more capital. they won't call it an explicit government backup. they will say it's insurance like the fdic. we are going back to the same model that blew up. listen, i know, i see it on twitter, all these clowns who bought fannie and freddie common shares at pennies on the dollar and they are making it like this is the greatest thing in the world, this is essentially protecting the individual rights of shareholders, if we go back to the old ways. i'm telling you, that is baloney.
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the courts have held up and rejected every one of the cases on this whole fannie gate matter. not only that, let's be real clear here, they don't exist without the government. connell: i will give tim the last word before we wrap it up. go ahead. >> a couple points here, charlie. couple things here. they exist again for the benefit of taxpayers. right now, through this conservatorship, the taxpayers have made over $100 billion on their investment. >> great. >> why don't we just take over apple and google -- something along those lines. >> apple was not created by congress. apple was not created -- >> the bigger issue, the bigger issue i think for everybody is you know, look, the constitution exists, there's a fifth amendment around unfair taking. there should be -- >> it's -- every judge has je t
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rejected that argument. connell: ten seconds, tim. make one point quick. >> you have international insolvency rules for a reason. they treat stake holders all the same, predictable and fair. you can't give everything to one stake holder. connell: you guys talk offline. we'll be right back.
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♪ connell: so one thing we have been watching today, the commerce department giving the president its report on impact of auto tariffs that the european union is warning now of retaliation. association of global automakers president always talks to us about these issues.
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represents foreign automakers operating in the united states. eu says tariffs go in place, john, swift retaliation is coming. what is the concern here? how does that play out? >> this is no surprise. we talked about this, tariffs are a bad deal for american auto workers. they're a bad deal for american auto consumers no question about that. prices will go up, demand will go down, our trading partners will retaliate. that is the problem here in a nutshell. connell: might be a way to hit china again, what i'm told, edward lawrence is covering this, point it out. if you put this type of a tariff in place, you have auto parts assembled in the u.s., mexico, canada, some originally come through the chain of chinese manufacturing. so not sure if that is what the white house is thinking in the middle of these trade negotiations with china, it is another kind of tool? >> that is for the administration to describe what their thinking is but i can tell you what the impact will be. connell: big?
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>> parts coming in from china and other places but low value inputs into a higher value manufacturing design business here in the united states. we want to preserve that we want more investment here. just uncertainty surrounding this report will freeze investment that is a big problem for us. connell: so that happens, these tariffs go into place, how does it play out? the industry you represent what happens next? how big of a deal is this? >> this is a huge deal. every single car in maersker will face a price increase. why is that? every car sold in america, made in america, has some level of international content. it might be foreign made and imported or -- absolutely. connell: coming from somewhere else. price differs across the board, what percentagewise if someone buy as car, like 40,000-dollar car what type of increase in price are you actually talking about or concerned about? >> figure the tariff is 25%
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tariff, which is the speculation we're hearing. connell: right. >> so that will increase car prices between 3500 and $7,000 a vehicle depending on how much international content of the vehicle, what the price of the car is. that is a huge price increase on americans. connell: are these tariffs, are you concerned, this is final point, do they come off, harder to make them come off than get them come on, seems like at least with steel and aluminum? >> no question about it. the cost of manufacturing a car in the united states has gone up billions of dollars because of steel and aluminum tariffs. we negotiated a deal with mexico and canada yet the steel tariffs are still applied. they go on easy. they come on hard. we have 25% truck tariff the result of a trade dispute on frozen chicken parts with west germany in 1960s. connell: you would think we would be over that by now. >> would you think so, john, thanks for coming on, putting
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issues in context. i will see you 4:00 eastern time with melissa on "after the bell." president's speech on venezuela in that hour. don't want to miss that thanks for joining us on "cavuto: coast to coast," time for charles payne. he has been all over the place. connell: thank you, connell. thanks a lot. charles: i'm charles payne. this is "making money." markets are closed for president's day, china's stock market soaring. trade optimism pushing their stocks to the best session since november. are which on the verge of a deal. president trump gearing up for a big speech of the venezuela crisis with warning on socialism. will alexandria ocasio-cortez and bernie sanders listen? speaking of aoc, new york city mayor bill blass -- de blasio said she didn't understand that deal. will our

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