Transcripts For FBC Cavuto Coast To Coast 20180206

Sort of analogous to portfolio insurance in 87. Stuart not like you to engage me in conversations in the first minutes of your show but i will tell you neil im kidding. Im kidding. There is always sort of a monday morning quarterback that comes back to look at weird things prior. You and i can remember the whole portfolio insurance thing of 87. Just me, just me alone, all these Creative Products that are meant to sort of cushion the blow of just Market Forces end up creating the crisis to begin with . Stuart all i will say is, neil, dont ever come on my show with that stuff, you will get the buzzer throughout. That is a fact. I should have taken your question seriously. I got a car waiting for me right outside. It is warming up. Neil lizzie would appreciate my curiosity on this. Liz yes i do. Neil talking to the wrong person amounts soon as the papers were cleared, thats it. Thank you, my friend. I think stuart is absolutely right to say im obsessing about something so arcane. We didnt have these product as little more than a few years ago. Now you have a big financial money bank, Credit Suisse, were dropping one of them. Man, oh, man, it is killing us. Well get to that in a second. Get to the back and forth volatility in a second. Focus on. 10year treasury. That has been the focus of a great deal of attention. We never know the trigger point which people move into that as safety. What we do know is we have had 1000 point trading range in the dow alone right now. And we are also hearing that Steve Mnuchin, the treasury secretary, is not too, too much concerned about this volatility, telling a lot of folks as things stand right now the markets are doing what they should. To which the Financial Press said, duh. Lets go to Deirdre Bolton to break it all down, what is going on right now. Neil, you were talking about all the wild swings in all the markets. Look at the dow. This is thepoint range for the dow itself. Well pull up an intraday chart. You will see essentially it looks like a series of Little Mountain peaks. This is crazy. A lot of people ive been speaking with, in the next 48 hours well still have volatility just as some much these formulas you were talking about, algorithms, that people write, they decide when they want to sell. The machines do what they want, they do it faster. You have had increase in volatility. What feels shocking about the past three days, as we put it in context, i show you the chart you already know, neil, but the end of january, we kept hitting high after high after high. A lot of strategists, fundamental stratgifts saying listen, we were kind of lulled into this peaceful place, this eightyear plus pull market. That is what making the selling of the past three days feel all more shocking. Not just us, were affecting trade around the world. Look at asia and europe, well pull up those levels. You had huge losses in japan, hang seng and singapore. Same thing in europe. Just a selloff across the board. I spoke to a few people to what extent the algorithms are affecting our trade. One trader told me yesterday when we had 900 point drop in ten minutes, that gut lurch, he said listen, nothing breathing could have caused that drop that fast. This was set up by a formula. Essentially giving investors of all stripes a little gut check of epic proportions. This is hazing of Jerome Powells first day as chair of fed. Welcome. Neil, back to you. Neil talk about baptism by fire . Only couple months later that green green Alan Greenspan came on board. Mark cuban told us earlier he is buying something but as concerned about something else, people stuck with a a lot of margin debt. Others were telling me, no, neil, this is pricey, price earnings that guys like you look at . Depends what our personal financial situation is. If you have to marktomarket every day, then you shouldnt be in the market. I think part of the problem today, why we had the biggest selloff ever, when markets to straight up the past 14 or so months. People get overconfident. There is saying everybody is a genius in a bull market. When they get overconfident, they start buying on margin. That works until it doesnt. You have had people, i saw something recently there were a Record Number of retail accounts set up recently, a lot of money coming in from individual investors was at records. A lot of that was probably being borrowed. If all of a sudden you get an alert on your phone or get a call from your broker and your stocks are down significantly you bought on margin, youre pretty much forced to sell. I think that contributed a lot to todays decline. Neil you know, everyone of the recent hits weve experienced in the markets that margin call, when your broker calls you up, look you have to sell stock or add some cash to your account to make things whole here, that is always been something that continues the falloff here. Now you may not know it in your brokerage account but the default for a lot of these guys is to make sure whatever additional stocks, mutual funds you buy on margins based on value of your portfolio. Usually 50 of what you have there you can buy additionally. They argue it is neat, clean, very efficient. The problem with that when things turn south it quickly loses its neatness and efficiency. Lets get the read from charlie gasparino. Lauren simonetti i saw her at 4 00 in the morning. David asman is here roundtheclock as well. Lauren, you had wind what was going on in asia. Selloff ensuing. Europe, worst levels by days end but still very, very volatile. I couldnt see the futures where my cameras was, i was anchoring with connell, passing me notes, down 200, up two. Down 300. Neil he was making it up. Making it up. Passing love notes. No, it is crazy environment. You dont know what to expect. We saw europe open down 3 . Then it was down two. Neil right. Asia just destroyed. Japan was down almost 5 today. So some really ugly involved numbers but everyone keeps saying why . They seem to be following the u. S. Market. They seem to be citing Central Bank Policy perhaps not here in the u. S. But around the world will change today. Hazing day yesterday for mr. Powell. Neil absolutely. Will Central Banks respond to inflation a la wage growth . The fact that Interest Rates are going up. Which is not a bad thing,. Neil david, you and i covered 87 crash in different venues, Velocity Shares, inverse provix, wonky and everyone is right to criticize me, they were tumbling, be markets, down 80, 90 , setting up fall in the morning. Here is why the inspiration of those indices, for those protections were to shield you from Market Forces. Right. Neil i consider them to be a modernday portfolio insurance which was stupid then in 87. I think just as stupid now, as if you can shield yourself from market force. Only way you shield yourself is by diversifying. Thats why one. New instruments, etfs, our old friend ben stein talks about is spdr fund. Get a spdr. Diversified in 500 stocks, ride out the storm. Neil that is the mark cuban approach. It all depends on your time frame. If youre looking to make a lot of money over the next six months, youre in tough shape right now. But if youre putting money in a spdr for a couple of years, forget about it. This storm is going to pass. That is true. Were not going into recession. That is the important thing. If it were a terrible economy and mark credit crash like this it woulding longterm route for next couple years that is not the case. We have relatively strong economy. There are headwind we have to head into with higher Interest Rates. Generally speaking the economy is good. When the economy is good it generally reflects in the market as long as you have longterm time frame, one or two years. Neil we heard from the Trump Administration, heard from treasury secretary Steve Mnuchin to your point, no one doubts the economic fundamentals are sound. Did the market fundamentals get ahead of them . I think so. Here is where i disagree with some of you. First off these crazy products, we get them all the time. Neil youre absolutely right. Whats thing in 2007, 2008, derivative of mortgagebacked security. Cdos. Synthetic neil if you want to do wonk on tear road thing, every single selloff has been punctuated by remember what carl icahn said two years ago. The etfs sell into illiquidity. There is not a lot of buyers. By the way even if you put your money in a spdr etf that buys the neil dow or s p or whatever. Looks what happens. You get redemptions. They dont sell one stock. They sell baskets of stocks. Thats right. Then there is somebody that buys it. It comes back up. Neil these products are now part of a mix and weird and wacky algorithms that get crazy. That too. Remember people did not buy a lot of individual stocks. They bought mostly basket of stocks. Neil algorithms are set off bit baskets and set off, very unemotional. The baskets are timed to algorithms to peg off certain economic news. Neil this is what i feared. This is what i feared. Bottom line is if youre borrowing money to get into some of these instruments youre really risking the home for that sort of thing. If youre doing that to get to the instruments charlie is talking about, forget about it. Neil but it compounds the volatility. We used to focus on, as we should, the cboe volatility index, level of fear, it is a snapshot. These were two new things created by the same folks. Inverse to protect you im i know im sounding wonky and obsessive credit default swaps. Neil my point people use these to shield themselves from Market Forces you can not do that. My point, generally you cant, but my point is those are not the reasons why we have a neil they compound them. Whatever is going on. Everything is compounded when the heard starts moving certain way. Herd. Trumps fiscal policy, markets debate we get three, 3 1 2 growth or not much more growth. If we dont get more growth, the markets are saying you know what. Well get much bigger deficits, much higher Interest Rates, not the 2. 75 10year. Figure like 3. 75 . Then we will have not just a market correction. We will have a recess. Now the markets are saying that. By the way, david, we had the conversation yesterday. I dont subscribe to that a lot of smart people think the Corporate Tax cut will not happen. Not produce 3 1 2 growth you need. Neil what prompted the reassessment . We have the same forces, same macro forces . First of all the two weeks ago mistake by mnuchin who talked down the dollar. You just dont do that. That is what, that is what happened the day before the market crash in 1987. The treasury secretary back then it, was james baker talked down the dollar on sunday. Monday the market went down 2 22 that is really big mistake. He tried to today. One good news, gold is down. If there is flight to quality, it is not going to gold. You know where it is going . The dollar. It going into the dollar maybe a good sign the dollar market is recovering. Neil he had an interesting report, data is good. Psychology is poor. What changed the psychology . Neil that is what im asking you. I ask the questions. Im kidding. To make a point that trigger point comes when people either pounce on anomaly or something that hints that the crowd is wrong. Everything that weve seen thus far, despite thesefy races and volatility making it is orderly. A lot of computers are selling. A lot of things seem orderly. What changed the psychology. Neil this is same guys that dont see it coming. Im going with the jobs report. How do you explain the atlanta fed saying well see 5. 4 . How do you explain the atlanta fed you have to stop because they say a lot of crazy things. George soros, they have been wild on predictions and stuff. By the way the market is up 100 points. Very interesting. Were talking it up. I guess so. George soros a guy we dont quote a lot on this network, talks a lot about herd mentality herd mentality could have been trump putting tariffs on chinese goods. People saying where are valuations . Are we overvalued on based on corporate earnings . Will this tax cut materially affect gdp . They said screw it. Take some profits. Because im telling you, neil, if we dont get 3 1 2 gdp, what that really means, lets do the math, that means the budget deficit more than widens out in the first year. Neil youre making a leap might be a catalyst. That is what the markets are doing. Neil 10 correction. We dont see that by days end or soon, would you be worried about that . That we havent experienced that. Not, not at all. I think the market may in fact turn around for positive reasons because they think that eventually the, these nerds who look at the figures and dont belief in effect of tax cuts are wrong. If the market decides, i agree with you, if we dont get the sizable increase in gdp, then the deficits are a problem. They will have to sell a trillion dollars worth of bonds at the Treasury Department and the fed will have to sell 600 billion worth of bonds. The only way they can sell that many bonds in the market by raising Interest Rates. You know what that does to the market and economy. You know your reputation and Larry Kudlows reputation and my reputation is on the line here. Neil you dont have a reputation. What little i had, i walked right into that, what little i had, because we all believed that tax cuts produce faster growth. Neil we dont know that they havent. They just havent. We dont know that they have. Neil you are assigning something market is not doing that at all. Yes, they are. Neil no it is not. Market is not doing this. I am telling you whatever is going on here has to do with these Exotic Products that are no. Neil i might alert you, Credit Suisse is already announced that it is ending its association with proshares, short vix etfs. For two reasons, one its a mouthful and it is long. Secondly it didnt do what it is billed to do. Tell you folks, we will have more such stories. Dont listen to charlie gasparino. He has no reputation. A well have more after this. snap snap achoo achoo feel a cold coming on . Zicam cold remedy nasal swabs shorten colds with a snap, and reduce symptom severity by 45 . Shorten your cold with a snap, with zicam. Neil why the market can be your friend, can turn on you and be your enemy. The gipper got it. What is the balance for the new president . Im told Ronald Reagan was loathe to quote the stock market a lot or brag about it. This president not so much. So you worry about the president mentioning the stock market so much, good reason to. It has soared, but the old saw it can come back to bite you. This president has been often quoting these markets. Bill clinton was loathe to do thats a least quote the markets, to pair phrase him, like Ronald Reagan, you dont want to be caught in a middle of a big crash. The president owns the markets on the way up. Does the president own them on the way down . We might get first hint from the white house briefing. Where theyre coming from this, treasury secretary Steve Mnuchin on the hill is saying he is not not worried. Im paraphrasing here. The markets do what they do. Blake burman from the white house. Blake. Reporter neil, weve seen President Trump over the course of many months tout the market on the way up. Now that there has been a snapback or pullback at least couple days, broader message for the white house, is dont look at daytoday fluctuations. Look at Bigger Picture here at the whole. That is the argument theyre trying to make right now. Vice president mike pence in south korea ahead of the winter olympics, when he spoke to reporters yesterday a little while after the market closed, he made the case that the fundamentals of our economy are strong. He said yesterday, simply the ebbs and flows of the market. On the Bigger Picture, white house spokespeople that you talk to say, hey, look, there is tax cuts in place. There is wage growth weve seen. There is a strong labor market. Lets look at the Bigger Picture here. That is the argument theyre trying to make. For example, the spokesperson, Deputy Press Secretary hogan gidley was saying that the president has not focused on the market as a priority of his but he questions where others had their priorities when the market was running up. Listen. Obviously the president did tout the stock market but would i hardly say that he focused on it. They went walltowall with coverage of the stock market declining. I understand that is big news. Where were they when it was going up . They didnt say a word about that they are trying to discredit this president s economic prowess and what he is able to do. Reporter kneel youre right well here from Sarah Sanders in next couple hours. The topic will be how much the white house wants to own this stock market. The big story, democrat memo, response to the republican memo of the house intelligence committee. That is here at the white house. That is exact same process the republican memo went through last week. Five days the president has to make a decision. The big focus on this will be sources and methods, whether or not they are in or not in this democrat response. Neil . Neil i look forward to that. Blake, you know what i look forward to . Your questions, i think theyre among the best. Not because you work here you get right to the nittygritty and they dont throw you out of the press room which is a good thing. Reporter they havent thrown me out yet. You have a suggestion today, neil . Anything you want to ask. Neil like it now, mr. President . See how that goes. Really does a great job. Nononsense. Right down the middle. Not red or blue, just green, making sense. Get read on all of this with hadley heath manning, Washington Examiner commentary writer emily. Jashinsky. Whatever they think about the other news organizations not paying to attention to markets on the way up, they are certainly now on the way down. How do they handle it. Should they handle it, what do they do . I us speck they will be quiet about the market if the trend continues. The strategy today was at least see the forest for the trees. Lets take a big picture look on daily occasions touting daily increases. Well see if the trend continues of less talk from the white house. Neil Ronald Reagan comes to mind, bill clinton comes to mind, hadley, not talked in terms of the markets but more specifically about the jobs, underlying economy, Economic Growth, consumer spending, all of that, didnt align themselves to the market, they pointed out Ronald Reagan after eight years, after the the 87 crash, are markets higher than what i took office . Yeah, they doubled. That is where he left it. What if markets rebound from this and donald trump is tempted to start quoting them again, what then. This experience this past week is a good reminder the stock market is not the economy. Ultimately Ronald Reagan would have asked you are you better off than you were four short years ago. That is question he put before the American People. For some americans, yes, when the stock market does well they can do well. They answer the question postively. I am better off. We should rood for the stock market to do well. The stock market is not the economy but not the enemy of the economy. It is not the enemy of working people. We want to celebrate when wages are going up and our labor market is strong. That look good today. But we should root for the stock market to continue to prosper because that affects millions of americans, not just those who invest but any type of retirement ask the or depend on Charitable Endowments to do well. I think president continues to tout a strong stock market if that continues to be the case but ultimately that is not the most important element of our economy. We want to make sure our fundamentals are strong as well. Neil the economic fundamentals, i dont care if you like the president , dislike the president anymore that if you like bill clinton or dislike bill clinton, in case of serious downdrafts in both of their markets at different periods economic fundamentals were sound, emily. There is a debate back and forth whether the tax cuts will make them more sound. A number of Financial Firms are upping their predictions of growth in the economy later this year, precisely because of those cuts. Charlie gasparino was here raising a possibility that they have been too generous in those, in those estimates. That is one of the things roiling the markets. I disagree with him on but what do you make of that . I think this all gets to the issue why it is problematic. Maybe not problematic, why its a risk for president s, even implicit to take credit for market swings. That is where it gets really tough on political level for a president to step in, make that implication, or make that even explicit. This is going to happen, historically we see how this happens. We see how this plays out. So the Trump White House will have to grapple with that in the comes days. Neil we have dysfunction continuing in washington, hadley, inability to come to accord apparently on daca. We might get an extension to keep the government operating with another cr. Progress on immigration might be a year or more away. What do you think of that . Partisanship reins very strong in todays washington. That is the case with policy issues like immigration. The case with unfortunately, our process as we the public learn more about the nunez memo and potentially another memo as we continue to look into the russia investigation. Ultimately our hope is the American People should be that our leaders can put good, sound policy ahead of politics here. And really work to protect, not just the integrity of our borders but also integrity of our Law Enforcement agencies. Something congress is charged to do regardless of the d or r after your name. Neil you know what, i really like that . Ladies thank you very much the dow is up 158 points here. I know i sort of trash my own, maybe networks approach to this. I dont focus too much on the volatile movements here except that we are in fast Market Conditions and in such conditions powered really by algorithms, i was meeting with a guy who is expert on this, and you wont believe the formulas that are used that can whipsaw markets hundreds of points, sometimes within seconds. So that is why you dont really attach too much value to an average at the moment because you are literally one push of a button, a computerized trade, as it is known, could trade everything. It is built on a variety of different factors, mood, sentiment, the gap or the trading range between two wildly different products like a commodity and a stock index. That is what has taken over these markets, my friend. And that, is why im so obsessed about these other creatures that we created, long after the cboe volatility index, socalled vix, there is like son of vix, beneath the planet of vix, escape from the planet of vix, and now, im telling you it is like weird. Im telling you, it is super, super weird and now the vix has kind of hit the fan and i will explain all this and even bore you more right after this. I can do more to lower my a1c. Because my body can still make its own insulin. And i take trulicity once a week to activate my body to release it, like its supposed to. Trulicity is not insulin. It comes in a onceweekly, truly easytouse pen. The pen where you dont have to see or handle a needle. And it works 24 7. Trulicity is a onceweekly injectable medicine to improve blood sugar in adults with type 2 diabetes when used with diet and exercise. It should not be the first medicine to treat diabetes, or for people with type 1 diabetes or diabetic ketoacidosis. 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From godaddy in fact, 68 of people who have built their. Website using gocentral, did it in under an hour, and you can too. Build a better website in under an hour. With gocentral from godaddy. Neil welcome back, everybody. Bum 159 points right now. Weve been up all over the map. It is ridiculous. Im telling you here is where im going to sound like the old guy, telling you in my day we didnt have these creative market byproducts. You often heard about the cboe fear index, volatility index, socalled vix, how it was exploding. You know they came up with a product to counterthat. In other words if the market is tanking on fear, they have something called Velocity Shares daily inverse Short Term Exchange traded etf. I only mention this because it actually compound ad a lot of the volatility. It fell 14 yesterday. Steve file on my guest on your world on fox news, it is trading mechanism, sentiment indicator you can use as reverse to the volatility vix thing which is ridiculous to put a number on fear. That was falling 84 . So it was setting the stage, this morning for added volatility having nothing to do with the fundamentals t was a builtin mechanism by which you could counter the fall in the fear index if you wanted to essentially short the fear. I know im giving awe mouthful here. But im telling you, we are veering away from simply buying and selling stocks and expressing sentiment, looking at things like value. I know my next guest would agree with that. He built a fortune getting away from some of these Exotic Products. He is a multimillionaire investor, foster friess. Foster, im telling you, a lot of these things come to light. I dont know if it will be this particular market hits of portfolio insurance of 1987 or mortgagebacked derivatives or any of that stuff but it is another creative product to apparently shield you from Market Forces and i dont think there is such a thing. What do you think . You hit the nail right on the head, neil, it is individual companys fundamentals eventually will carry the day. Talking with my guys, they say 60 of the companies are showing increased estimates, that it is quite bullish. When the market runs up as much as it has, a breather is often expected. Neil absolutely. Your point about these vix and all these different issues, exasperated because theyre dealing with traders who are more emotional and they watch those nonfundamental issues which are kind of trading vehicles and i remember we always say never invest in the stock market we would tell with our clients, invest in individual companies. A couple fears we should be concerned about though. First time in history the Federal Reserve physically attacked wells fargo. This is going to be neil that was a very big deal. Youre right. That will be 400 milliondollar hit on that institution according to the wells fargo folks. That is not just punishment that could wipe out an industry, at least with the market value. What it does, it raises concern, the Trump Administration really serious about cutting back on regulations . That looks like regulation on steroid. Neil who did this . It was Federal Reserve, right . When that happens, neil, a lot of these investors are now passive investors through electronictraded fund. So if 36 of american investors are in these now, when that etf goes down with the banks that causes people to create selling and a lot of them are on margin perhaps. So we have to have that as new ingredient. A little bit what youre talking about its a synthetic issue that has nothing to do with fundamentals of the stock. Neil youre right about that, faster. Looking collectively of the market especially beaten down going into today, some interpreted reigniting value if there is such a thing. The market is cheaper now. Mark cuban is buying s p 500 etf there, because it represents fairer value certainly than it did prior. Do you agree with that . Or do you believe this market might be a little rich, finding value in might take a little value, what do you think . Why it might be rich may be a concern about rising Interest Rates. The truckers my guys are talking to, are raising rates to shipping good, increases retailers cost of goods and puts prices up and prices up, Interest Rates could peek up, that would be one concern. Another concern if the democrats make some progress coming into the midterm elections which could reverse the tax reform bill, much like the republicans trying to reverse obamacare. By and large, the fundamentals are all strong and people, i dont think realize, not only did the tax rate for corpses go from 35 to 21, but, they get to expense things the first year they buy them. Neil so it would seem to grease the skid for more productivity. Im told that bull markets dont die of old age but actually a couple of them have. They sort of peter out. This one will be nine years next month of the is it getting old . It is more of a function of the companies growing. Companies that are doing well will be a lot larger five years from now. So the trick is isolating those. I believe too, what americans kind of sense might be coming which is what they want is more return to civility. We see a lot of signs where civility is beginning to come back a little bit. There is a opportunity in the health industry, which is 20 of our economy, where as i go walk around the colonies it is hard to find anybody opposed to publishing of health care costs. Hillary supporters, bernie supporters, trump supporters. If we can introduce, which is introduced, there is a bill in the Senate Committee by democrat early, Ed Perlmutter and mike gallagher, two congressman, cause all providers of health care to publish prices. You cant find anybody opposed to that. Neil could you be right. Youre deeply religious and decent human being. You believe civility is returning. I dont see it but maybe youll be right. Foster friess, very good seeing you my friend. Thanks for having me. Neil whatever you think of politics, im telling you the business of books, one of the greatest Value Investors to have ever lived that young man. Neil well have more. The dow up 244. More after this. Stay confident for over 80 years. Call us or your advisor. T. Rowe price. Invest with confidence. I accept i dont i even accept i i used thave a higher risk of stroke due to afib, a type of irregular heartbeat not caused by a heart valve problem. But no matter where i ride, i go for my best. So if theres Something Better than warfarin, ill go for that too. Eliquis. Eliquis reduced the risk of stroke better than warfarin, plus had less major bleeding than warfarin. Eliquis had both. Dont stop taking eliquis unless your doctor tells you to, as stopping increases your risk of having a stroke. Eliquis can cause serious and in rare cases fatal bleeding. Dont take eliquis if you have an artificial heart valve or abnormal bleeding. While taking eliquis, you may bruise more easily. And it may take longer than usual for any bleeding to stop. Seek immediate medical care for sudden signs of bleeding, like unusual bruising. Eliquis may increase your bleeding risk if you take certain medicines. Tell your doctor about all planned medical or dental procedures. Im still going for my best. And for eliquis. Ask your doctor about eliquis. Neil do you see this growth continuing . Oh, my god, neil, 10 years i come on with you, i never said anything positive long a stock or market. I find a way to see where the overvalued situations were. At 20,000, i saw 25. At 25 i see the repatriation i saw the money coming back. I did call the donald yesterday and say 30. Neil john tabacco, one of fine wall street minds. He has been ahead of curve. But is he too ahead of the curve. Lets ask him, john, what do you think . Neil, still sticking with the 30 call. Neil when will the 30 happen . Is it pushed back. I dont have the crystal ball with me today. Neil you had it a few weeks ago, smart at this pants. I dont have it today. Neil all right, all right. By end of Second Quarter a lot of macro policies still in place will continue to drive the market what. Neil like what . Givegive me a few examples. Talking about 2 1 2 growth when obama couldnt get over 1. 5 in the future. Im hearing correction, wages are too high. Like bizarro world from seinfeld, people making more money, lower taxes putting money in their pocket is a bad thing for the economy. Companies are repatriating. Home depot giving thousand dollar bonuses. Jetblue giving thousand do lar bonuses. You see the green shoots. Neil nothing like you and i can remember a few years ago but higher enough norfolks to start tell them. People get startled. After brexit we talked about at big swing down. I always feel the same. Retail investors should invest for the long term. They should stay calm. Neil what is longterm to me . Long term my age is lunch tomorrow. What is long term to you . If i make lunch tomorrow, neil, i will be happy. Neil there you go. People should invest in the future, early 60s for the rest of their life. They shouldnt look at these stocks neil what is standard longterm view . Peoples lifestyles change every five to seven years. They should look at rebalancing their portfolio. I look at situations like this. These are great opportunities. Markets are supposed to green out. When they go lower, find values. Invest in the long term. Neil john tabacco, thank you very much. One fellow agrees with john tabacco, steve newspaper mnuchin, the treasury secretary. Saying everything is fine. The markets do what the markets do. Now if only he could get to his boss. After this. And explorers whose stories take us places our hamstrings cant. All we have to do is listen. Download audible to start listening. Mom anits not theirs. Car. Its mine. Mine. Mine. And it always will be, forever and forever. The new rx 350l with three rows for seven passengers. Experience amazing at your lexus dealer. Neil the fundamentals are sound. That is the read weve been hearing from a lot of brokerage community, Investment Banking community is, they dont call them brokers anymore, do they . From the Trump White House well get more of that, when sanders takes to the microphone finally field questions about markets somehow eluded her when they were soaring. Will be a little different today. We have republican congressional candidate. We have called out to his opponent, scott peters. Always fair and balanced. Yet to hear back. Hope springs eternal. They usually come on in the end. So well see. Michael, very good to have you. My pleasure. Neil you were telling me during the break, whether youre left or right on this, the macro issue, the fundamentals look good. Explain. They do look good. The economy continues to grow. Im looking next two quarters it be quite positive. We could look at 3 next coming quarters. Unemployment is low, some of the lowest since we have been measured. Neil market factored that in, priced to perfection. Markets move on changing expectations. That is what were seeing last couple days. Neil also markets move on in transsy against . Washington. No progress on immigration deal. Maybe punted for a year or more. Another continuing resolution. The fourth of this cycle just to keep the government lights on. It is kind of crazy. It is crazy. Wrong way to govern to hold the government hostage on any particular issue. Certainly in san diego where im from, the people do not want the government closed down over daca, any other issue. They want to keep working. Lets address the issue separately. Neil how bad do you think a market downdraft gets. It gets all the talk. It settles down. We might be at a new level, more affordable level. What do you think . Look at big picture. Were still up trillions of dollars since the inauguration. Business people dont get too fixated on daytoday markets. Neil would you advise the president in the future, tempting to talk about trillions added in market wealth, what you talk on the way up, you cant ignore on the way down . That is true. Doubleedged sword. How democrats were saying markets is up, average guy doesnt win, goes to the rich people. When it is down seems like everybody is losing. Neil youre right. Average people are getting creamed in this. When you as very successful businessman looking at this, some people are getting too clever in this stock market . There are all various Exotic Products, trigger algorithms. Right. Neil we have more mutual funds and etfs than we do stocks. That is weird, right . Its a bit weird. But people look for exposure in different ways. How do i get exposure in asia . How about japanese stocks. They have a fund for that. Neil formulas and measures. We see some daytoday volatility, right . Push a button or trade on its own. The algorithms will execute their own trades. When it gets wild swings in either direction, i came in first thing in the morning bought on the open today. I think it was down market. Neil what were you buying . S p 500, you and mark cuban. He was doing same thing. Im in good company. Neil Interest Rates still very low. Still low. Neil are you worried as some empty markets seem to be worried we look at backup in rates . I dont think it is severe. Economy sin creasing, rate pressure, i dont see it moving couple decades ago in the wild swings in the market. I dont see that happening for us. Fundamentals are strong. Let markets work. Dont need to worry about intervening from washington. Neil stay calm, stay calm. Michael allman. We had almost 1000point range yesterday. Very crazy. Is that good for bad . Forget about your stomach, for your Financial Health . After this. Hi, im the internet you know whats difficult . Armless bowling. Ahhhhhhhh you know whats easy . Building your website with godaddy. Get your domain today and get a free trial of gocentral. Build a better website in under an hour. . . All right, the volatility continues. That is how fast they were running on the floor of the New York Stock Exchange today. We have not doctored this tape at all. Bottom line we were up as high as 367 points and down as much as 567 points and that was literally within seconds of the opening bell. Nicole is at the New York Stock Exchange with more. You saw a speedy open right outside the gate. As you noted, we had a lot of volatility, wild violent swings after two days of trading we were down over 1800 points, 7 and today everybody was really worried about the open and most of the traders that we would open to the downside which we did and as you noted, up 367. Its been back and forth. Holding onto some gains of 94 points for the dow. Whats interesting is i asked around to say are we going to retest the lows and this morning it was maybe that we were retesting lows. Now there is a sense of calm in the back half of the day. I also wanted to take a look at the volatility index. 3675. Yesterday 115 to the upside and a lot of that, what happened as it moved higher, the people who went the other way really got squeezed. There was a lot of talk that maybe they had a jump out of certain positions in order to cover margins. Right now you see 3683. Quickly, peek at the automakers, General Motors have been cutting costs on pickups, suv and showing lots of resiliency here in north america. Gm of 3. 6 today, ford motor also gaining. Thank you very much. To nicoles point about this trading and the shortterm fund that allows you to do that, as if you can trade the fear. Like you to think about that. Its a numerical way to represent fear. Its asinine from its very definition. Im just saying, we have become too clever for words. Then theres a product that to counter that product which is equally asinine and then theres a product that is a middle road for that which is crazy asinine. Im telling you, this will be the death of us. Did i tell you when i was a kid i walked 6 miles to school uphill both ways. Im sounding like that. Better stop. Lets go to adam shapiro. Hes been monitoring things on capitol hill. Essentially wednesday mnunchin was asked about a specific issue that the fundamentals of the economy remains strong, there is no threat to the Financial System and study the course. It is still up over 30 since donald trump was elected president back in november 2016. But when you watch secretary who is taking questions on all kinds of issues remember this hearing was supposed to be an update on the annual Financial Stability Oversight Council report, all kinds of questions like crypto currency and dodd frank ray literary reform. There are also questions of stock volatility and look at a montage of what he said to those questions. Im not overly concerned about the market volatility. I think the fundamentals are quite strong. Does this have Financial Stability implications . No, i dont think these types of moves, given how much the market has rallied, have Financial Stability concern. What is the disconnect between the market coming down in fundamentals being strong. I think youve seen a normal market correction, although large, and i think again there is just a disconnect in the short term. Markets move in both directions. Neil, if there are investors that will be on the headline for the next big thing that might be coming out of washington, the secretary has been talking about gst reform and that something that jay powell talked about, the chairman of the Federal Reserve. Start looking at whats going to happen with the government supporting fannie mae and freddie. And the housing market. Hes also been talking about Regulatory Reform with dodd frank that for Smaller Community banks to close branches and expect movement on those issues as well. Thats all kind of wonky its all about the market and hes not worried. Thank you. So the fundamentals are good. Theyre still sort of going through the economic systems are to hear the administration tell it, ill find. Is it . Lets ask the reshuffle. We have dan shafer and michelle. Are you worried by any of the sword you subscribe to the same view that things are okay. The actual overarching economy is sound. The economy is sound, lets ignore the noise from a couple of days, tax reform really hasnt started work in. More important co optimism is really, really strong about the year ahead and they are paying a dividend to their employees as well as shareholders so i think you have to look behind the couple days news and look at a years worth of news and its a much different story. I agree with mitch. First of all, happy birthday Ronald Reagan. I think its fitting we were talking about strong economies, i agree. Stocks go up, stocks go down, im always much more interested in the fundamental analytics so im not going to be scared by, the secretary said the market is up 30 since trump was elected. Look at bond yields. He was constantly quoting that. He was definitely trumpeting and taking credit, which honestly i think he should because like, if the index, i agree with you, here is a little bit strange and we have artwork we can depict fear, picasso can do that. Its not have the bond traders do that. You been very concerned about this runup, now given the selloff weve had, are you less concerned because, there was a good piece in the journal about how more affordable the s p 500, as in aggregate, has become. Its still way too expensive. The concept is that the pricetoearnings ratio are way out of line. s youth still think its a rich market. How far would it have to fall. Back to where it started on the election night. Thats where levels should be. It was 18332. That would be my first targe target. Thats about 6000point. Tax reform and Regulatory Reform have little impact on expectation. No. I will tell you why. There is an underlying tone in the velocity of money which we have talked about many times, and for your viewers, that just means money changing hands. The problem is that has been dropping to the lowest level since they started recording it in 1960. So, if we look at that level and we look at the Economic Growth that we havent been getting and Interest Rates basically went to zero in the ten year treasury which became the new barometer instead of the 30 year is still below 3 and were hoping to get above 3 growth in gdp. If you put it all together it just doesnt make sense. What does make sense, from a Traders Point of view that the market will go to certain levels based on emotional factors. Look at what happened with the coin. Big coin is the precursor of what we are now experiencing in the equity market. Now youre talking to different things. Its still an emotional side of trading. Do you buy that . Nope look at quarter after quarter of beating expectations in companies on the s p 500 and layer tax reform and regulatory rollback , im with you carrie, thats whats fueling ceos to be optimistic. So the market mightve factored all that in. They may very well have enough i will selloff, but nothing goes up in a Straight Line which is what you learned in college, stocks dont go up in a Straight Line and were seeing that,. Are we back to a more normal trading range or one that you would buy an s p 500. I think, as an investor you dont get it all at once and you get in overtime and maybe yesterday was a time, maybe tomorrows a time. But the argument has been, for young people, the world is your oyster and the trend is your friend and the chart we were showing is a longterm you will be okay. Were pretty much all screwed. What you think about. In terms of debt to gdp, yall are gonna make us go bankrupt until we can figure out how to be more fiscally sustainable. Pensions in many states like illinois. So youre blaming whatever Financial Hardship youre having on our. Will you created it. And youre pushing it to our kids generation. So to this point on growth, thing is they had to revise our expectations higher so things actually turned out better. It was a smudge. When i talk about the Global Growth at the inf raised. You can look at all of these numbers that look exciting and all these predictions that look great. The problem is the world is full of the most debt its ever had. Theres no way to solve it. You say it needs to go down to 6000 points lower so it is what it was at the election. Were not going to go down to 18000. If we were, would you be trouble that may be a great trust in this president was for not. Talk to me a year from now. Again, its what mitch was saying and then ill give you a more definitive answer. How about this but i have brown hair but i will be in the middle. We shall see. The dow is now up 19 points. Again, i only mention it because they say just quote the dow. Im telling you, it changes. The number that counts as 4 00 p. M. , a little after when its all finalized. Mark cuban thanks the white house is going to pay dearly for bragging about something over which it has zero control. Shes nationally recognized for her compassion and care. He spent decades fighting to give families a second chance. But to help others, they first had to protect themselves. I have afib. Even for a nurse, its complicated. And it puts me at higher risk of stroke. That would be devastating. I had to learn all i could to help protect myself. Once i got the facts, my doctor and i chose xarelto®. Xarelto®. To help keep me protected. Oncedaily xarelto®, a latestgeneration blood thinner. Significantly lowers the risk of stroke in people with afib not caused by a heart valve problem. It has similar effectiveness to warfarin. Xarelto® works differently. Warfarin interferes with at least 6 bloodclotting factors. 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Its important to learn all you can. To help protect yourself from a stroke. Talk to your doctor about xarelto®. Theres more to know™. This is where i trade and manage my portfolio. Since i added futures, i have access to the oil markets and gold markets. Okay. Im plugged into equities trade confirmed and i have Global Access 24 7. Meaning i can do what i need to do, then i can focus on what i want to do. Visit learnfuturestoday. Com to see what adding futures can do for you. Now the argument is, if you talk about it on the way up you only on the way down. You agree. No. When people are excited about our situation about their companies, the tax benefits certainly accelerated things and got companies excited. Thats all good, but markets dont look just at the current quarter. They look further into the future. All right. So mark cuban, essentially dismissing whether the president had much in effect on the market, the upside or the downside. Theyre talking to folks on the street and how they feel about all this. Whats the mood. Its shocking, we were both surprised how upbeat people were. There really optimistic and may see the selloff as just part of the way things go in the stock market. We met all kinds of people, europeans, people in the industry who are buyers, people who dont work in the industry and have 4o1k, heres what some of them told us. We needed a correction. It was coming. We all knew it was coming. Its just starting to happen now. I think the market will rebound. I think the policy is in place by this administration will help it, the tax cuts, the economy, it will come back. It was time to come down. Today maybe 500 or 600. What you going to do. Are you looking for bargains. Im looking to come down. So that fellow told us hes looking to buy specific stocks when they hit his target price. The thing on his radar is bowing. Weve had so much volatility today that its just incredible. I have to share, we talked to one older fellow who was clearly italian and he said to us, let me see if i can give it justice, he said what, do i look worried . Im not worried. Are you worried. Thats what he said. Someone named willis voting and italian, thats interesting. You got a step back but i think theres great wisdom. Our original name a we came to this country i stand corrected. It doesnt make up for the fact that that i italian accent was awful. Lets go to larry. Hes at the uva. Professor, when in the middle of the downdraft, we are caught up in the moment. The moments last . Timing is everything, but do they end up having an impact on elections. You mentioned timing. Certainly, if one came right before election day it would have some kind of impact. There is actually a general, a generally positive correlation between how the stock market does and whether an incumbent president is popular or not. There can be exceptions. Trump may be an exception. I think the people who were just interviewed in the street, including that italian who i am sure spoke more like us than the accent that i heard, we are italianamericans, as you well know, but they had it exactly right. Anybody with a few years on them has been through a number of these and they know the worst thing you can do is run out and sell when you have this candid downturn. You need corrections are part corrections from time to time. Its good for the market, its good for investment. People are going to panic over this. I do think the president would be better off not constantly referring to the stock market. What goes up will come down. Absolutely. I totally agree with you. Other president s have been tempted to seize on a performing market but theyve pulled back on things like job growth and wage growth them at the market help themselves. Doesnt make it more difficult down the road when the president will be tempted, assuming the markets recoup and i believe they will, he will be very tempted again to Start Talking them up. Well, if hes tempted, he will do it. I think weve all learned theres not a great deal of selfrestraint here, at least on twitter. He would be far better off doing exactly what you just said, talking about wage growth, low unemployment, gdp growth. These are fundamentals, and over time they matter more and they drive the stock market over the long term. The markets are going to come up now. The administration always complains that news coordination organizations ignore them on the way out. They wont ignore them now. I wonder how they handle that. Well, they should handle it by simply saying the markets go up in the markets go down and look at the fundamentals. Thats what he should have been saying all along. Yes there will be news organizations that say you sent out 47 tweets about the rising stock market. Yesterday you didnt mention the crash. Thats part and parcel of governing in america. You have to accept those sorts of things. All he can do is change what he does, if thats possible. I doubt it. We shall see. Weve heard of market bulls and bears but some follow a different trendline. Not the charts, ill explain, after this. . All right, some news that could affect the crazy markets, a shortterm spending bill in the house as possible with the vote coming later today. The senate is on the verge of doing something even bigger. It could be looking at a massive budget deal that would increase spending levels for both the domestic and defense priorities for the next two years. It is pulling a number of parties involved on both sides of the aisle. Lets get the read from doug collins from georgia. Congressman do you know anything about the senate thing. I think its an extension of some conversations weve been having for many months. We have to get to a bill in which we begin doing complete your funding and give defense a security over the next two years. There is work on that. Is it there yet, maybe not yet but we are working toward it because frankly thats what needs to be in play. We encourage our democratic colleagues to come to the table but they been sidetracked on illegal immigration and everything else. They just want to delay but we need that budget to make sure military is funded. You should hear what they say about you because i think it when comes to budget cap you get everything you want and nothing may want. You say what. Well, theres understanding when you look at this that to get the fence they will have to be some movement in nondefense discretionary. For some of us its more than with like to see but we have to balance the needs of the country and support the president in saying that he has laid forth his desires for the military. I think you will come to an understanding that we need to move forward. That doesnt mean we give up our principles but i think we have to understand we have to Work Together and until the senate does away with the 60 vote role with something with the deal at. We will likely be borrowing a trillion dollars more this year. Im not blaming you exclusively for that or republicans or democrats, but here we go again. Whats going on. The reason i say this because weve got to look at a longtime financial future that anybody,. [inaudible] Neither Party ever does it. We dont. I think thats holding our requirement that we have to face up to the future. When you look at longterm debt and the Interest Rate and what the debt payment would be, when you look at mandatory spending, we have to get serious around here to realize that 60 to 70 of this budget has never dealt with the appropriations. We just simply fund it. That is not a Sustainable Way to look in the future. As go back to something very positive. Tax reform. That will generate Economic Growth and provide income, but we also have to do our part on the side of spending and thats what were looking at a continuing resolution that may or may not come back with the bigger package. My question is why wouldnt you vote for this. We are Funding Community Health Centers with over 49000 people, we are funding those for two years. We are also defending our military, giving pay raises. How much worse is it to go out have issues like illegal immigration and folks who need Community Health center funding. The senate thing which seems bigger and longer term, thats something they are separately doing and then you reconcile all of the. We do. I think it will come back to us at some point. Thank you very much. Its good to be with you. As you know, we always like to have both points of view so whenever a bowl without a bear, even with the runup in the market, last time we had this next guest on, he was worried about stocks that were looking heavy, but he said headed for a fall. Remember that. What do you see . What your charts tell you. I would say at least as bad a bear market as oh 7 09, at the very least and that was more than 50 . Mark, are you nervous after today. No, im not really nervous. The market could go down a lot more but over the long haul, i think we will be okay. All right, count down to the closing bell. The new New York Stock Exchange, as we speak. Do they believe everything will be okay. I just grabbed tom green who is a longtime trader. He has been on every trading floor. Hes now here at the Stock Exchange but i said final hour, which can happen. He said liz, nobody knows. I love him. I think hes extraordinary smart. Every time he comes on the show i hear people write anything down and listen to what he says, but hes a billionaire. He can afford to take these hits. Right now you have the Retail Investor watching, and almost feeling helpless because all you have to do is look at the volatility, starting yesterday and when you begin to back it up and see that it was just a couple weeks ago that the socalled fear index was at single digits, look what happened yesterday where it began to spike. It closed extraordinarily high. Then in the aftermarket session you have one of these traded notes, it began to go incredibly squarely and now as we know, it has collapsed and will have to send out on february 20. So it begins to make people wonder, what about volatility because if you saw today, it spiked in a crazy way and now you can see it has moderated quite a bit, but what does that tell the person watching, whether they are a sophisticated investor or not. So rather dangerous market. People do jumped in yesterday and thought yea, i got things on sale, yeah you did but if you waited till 311 eastern time when we were down 1597 points you couldve really gotten stuff on sale. Its just a very tough game. You watch this way longer than most people. I guess the sense that you really understand that many people have to calm down, remain copacetic and realize this too shall pass, that is true, but when you see right now, when i started this a couple seconds ago, we were in the red for the dow. Now were up. Were up a point. Jumping around just shows extreme indecisiveness and things start to happen in the final hours. Thats when the hedge funds come in around 330, 345 to balance and close out their fund for the day. Thats when the selling or the buying picks up. Anybody who claims they know doesnt. Thank you very much. She will be there the entire hour before her show so stay tuned for that. In the meantime, stay tuned for the man who predicted this day would be coming, sooner than a lot of folks. Peter has an incredible voice. The deeper ominous voice tends to add to the fear factor. Peter, good to see you. You are not convinced we are through, are you. How you doing. Im doing great. Im, we spoke it was a couple months ago and i told you at that time the signal has been variable in terms of how quickly it takes hold. Back in 1929, i think we mentioned it on the show, it was a rally of ten additional to the upside on the dow. Guess how far, i checked yesterday, since my appearance with you a couple months ago the s p is up almost exactly 10 and now that was given away in a couple days. Are we done to the downside . No. We are going to get bounces, some of them big and a lot of them will make people think goodness thats over with, but if this is truly going to be a bear market, there is a long way to go. How much longer. Well, when we spoke last time, i told you i thought we were facing a bear market at least as bad as the oh 7 09 so that was over 50 . I still think thats going to happen. Its not going to happen in the next but that at least had a catalyst. Concern about Financial Stability and whether our Home Mortgage industry was a fraud which it turned out to be, there are a lot of people scratching head who argue fundamentals are strong and corporate earnings are robust. But you look at other things. Explain. Am i glad you brought that up. I have a little bone to pick with the guys that were on after me. I know it was steven and charles and you referred to my interview and you ask them, is there anything to what he says about this bear market and nursing no, will never have a bear market top unless there are fundamentals that point to it. While theyre absolutely wrong. Theres note top in history that the fundamentals appointed to pay go back to january of 73. A huge drop in the market and the headline was not a bear among them. That referred to all the experts. If you are fundamentalist, youre not going to come close to picking market. But dont fundamentalist change . I remember it didnt quite factor in what would be an oil crisis, things like that develop over time. Are you looking at something that we are missing that will develop weeks or months from now . Absolutely because the market leads the fundamentals, although i can tell you what its going to be. Thats a big trick. If you count on fundamentals to lead you through the volatility of the market deal youre not going to be very successful. Youre one of the brightest minds on wall street. Some agree or disagree with your forecast. You been pretty uncanny over the years. What you see now that a lot of folks are missing . Im seeing a couple of things. First of all, i began to see, at the end of last year, toward the end of last year, the tim kind of churning action that takes place as the market seems to be going straight up, the advanced declines are churning. Theres no big up day or more no big down days. That tells you theres not the kind of leadership and strength internally in the market that you look for in a continuing bull market. The lack of big down days tells you the sentiment remains very high. Everyone is buying the dips and speaking of sentiments, about this deal. Some of the numbers we see from investors and intelligence showed the greatest number of bowls in the fewest number of bears in the last 30 35 years. The whole background. So you would run the other way if thats how people feel. What about all these other derivative products. I was startled to see this development pick up steam for there are more ets in mutual funds and all these products that vastly outnumbered the stocks. Thats a fabulous point because what were looking at now, someone, i dont know how accurate this is, but i heard a year or two ago that the derivative market and the future options is a quad really in dollar market. A multi quadrillion dollar market. That number is inconceivable. Thats where the risk comes in when Something Like that starts to happen. Weve seen the last couple of days, a kind of hint at what we may end up seeing ultimately and the interesting thing is, if you dont mind, let me ask you a quick question and how many people that youve spoken to are really concerned about this market . You and maybe to others. There you go. I think thats about the percentage. Thats a huge point to make. Dont worry folks, this is a bull market, theres no bad news, unemployment is at 815 year low, we spoke about unemployment last time i was on. The unemployment level is down to 4. 1 , the last time it was there was the year 2000 what happened after that. The nasdaq went down 75 . Is there Something Like that in the works . I know its different and theres always a different catalyst, that we dont see until after the fact, but i think its all these elaborate ways you can trade off in a counter tradeoff of that that will cause problems. What is it in your eyes . In no your chart guy, what could undo it. Whats been a huge excitement over the past four or five or six months in the financial markets, that going. We see what happened to that. That led this whole procedure. We start to see that. You think the coin is like the nasdaq bubble. At some metaphor for this mania. Very roughly, but yes. What about the president and of course he talked this market up, a lot of people will say you should take account for going down. I know youre not applicable guy, what you think. We talked about the last time, and i said, agreed with you, if youre going to take the credit for the upside, then youre going to take the blame for the downside. You know, i always told my kids as they were growing up, and they asked about politics and president s, i said president s get far too much credit when things go right and far too much blame when things go wrong because they are kind of ponds in the whole overall gain that i would look at in terms of longterm economic cycles. In terms of longterm economic cycles, there is some argument you can make that this is the most overvalued market in history, despite the last couple days. You can still make that argument. Heres the difference between you and me. You talk to your kids about things that really matter. I taught my kids, your mom and i are spending all the money, were not leaving anything. It always alarms them but they get on the stick straight and narrow right away. Not a fun view of the world but i always enjoy having you on. Its always fun talking with you. Again, you dont have to agree to meet on to disagree but i think its important to get all viewpoints. Parties on 87 crash, the bear market and 73 and 74 and the real state collapse. That gives him some gravatar in my book. Ll street guy. Whats the hesitation . Eh, it just feels too complicated, you know . Well sure, at first, but jj can help you with that. Jj, will you break it down for this gentleman . Hey, ian. You know, at Td Ameritrade, we can walk you through your options trades step by step until youre comfortable. I could be up for that. Thats taking options trading from wall st. To main st. Hey guys, wanna play some pool . Eh, im not really a pool guy. Whats the hesitation . Its just complicated. Stepbystep options trading support from Td Ameritrade daniel jacob for every hour that youre idling in your car, youre sending about half a gallon of gasoline up in the air. That amounts to about 10 pounds of Carbon Dioxide every week. malo hutson growth is good, but when it starts impacting our quality of air and quality of life, thats a problem. So forwardthinking cities like sacramento are investing in streets that are smarter and greener. The solution was right under our feet. Asphalt. Or to be more precise, intelligent asphalt. By embedding sensors into the pavement, as well as installing cameras on traffic lights, we will be able to analyze the flow of traffic. Then that data runs across our network, and we use it to optimize the timing of lights, so that travel times are shorter. Who knew asphalt could help save the environment . A lot of people are looking at whats going on now, theyre saying you know, you should run for the senate, a lot of big names are passing up such an opportunity, but in your state they could use you. What you say. Neil, i am very interested in Public Service and service for the common good theres a lot of different way to do that but running for the senate in 2018 is not part of those plans. All right. That was then. I felt awful that day. Im sorry for the voice. No senate run, but you know, i didnt really listen closely enough because he said no senate run. And then lo and behold i get word that he stepping down which leads me too believe hes running for something. Could it be governor . Lets ask him. Very good have you back. Thank you for coming. Are you running for governor . What is going on here. What i just made a decision to leave my job in washington, but as to the next chapter, i dont have any announcements for you today. You taught me a lesson that i have to parse your words very closely. So you werent running for senate. I know they been pushing you to revisit the Governors Mansion in minnesota so are you at least interested . I have been topically reported, i am exploring that as an option, but certainly havent made any decisions in that regard. Im having my staff come through your words very closely because i dont want you to fully to me once, full me twice. I do want to know wiseman and other colleagues in the Republican Party are not filling the void when some of these big names leave, obviously the latest congressman to do so, now have what, three dozen luminaries, certainly just in the house were opting out say nothing of whats going on in the senate and some of the heavyweights to replace them in washington just arent there. Whats going on. I think theres probably a sense that each case may be different in terms of how long they been in congress and what their other life circumstances or opportunities may be, but lets be candid, this will be a difficult year for republicans. 2018 can get better but it will be a bit of an uphill climb in congress or other places where hours are unbalanced so thats just a reality. Thing people can simulate had enough. He thanks the market will be awful and keep tanking. That would not be good for the party in control, but are you worried . Especially coming from the Financial Services market that this is the start of something bigger and i might not even be justified but market corrections happen, what do you think. I listen carefully to the previous guest and his record of predicting gave me pause but i go back to common sense of the basics but if you have a market thats been driven in part to free money which Interest Rates have been effectively near zero in the begins to no longer be near zero, the cost of access to capital will go up, that will have a fact on asset prices. You dont have to be a Rocket Scientist to conclude that rising Interest Rates will have an effect on the stock market and thats whats causing this concern. You add the craziness that has been a bit coin and crypto currency speculation running wild to insane level. Im wondering, the back of an Interest Rate when they were certainly a lot higher, so this backup, while a concern, in the scheme of things it still rather low, rates are low. The market is concerned it will get a lot higher, that there will be more treasury notes and bonds i have to be printed and sold to support what will be another trillion dollars worth of borrowing to support a trillion dollar deficit, not good for republicans. Theres a lot of focus on the monetary policy, but when you look at the fiscal side of the house, the day of reckoning is coming as well. Unfortunately the congress and the American Public are willing to tackle that yet, but you have, as you mentioned, the beginning of what looks to be another trillion dollar deficit which will contribute to a 20 trilliondollar debt and its much higher if you count everything. Thats on 3 trillion of revenue. It just doesnt work. The math doesnt work and people will figure that out and it will have market consequences. Do you think the lesson in all of this is be careful bragging about the market when they are going your way its great, but you also on them on the way down. Politicians like to take credit for things happening that are really macroeconomic circumstances including governors and former governors. [inaudible] the reality is it comes down for lots of reasons beyond your control. To just to be clear, you are running for governor of minnesota, you will announce shortly and youll announce it on the show. [inaudible] well, go i say, ill go my own way with anoro. Go your own way oncedaily anoro contains two medicines called bronchodilators, that Work Together to significantly improve lung function all day and all night. Anoro is not for asthma. It contains a type of medicine that increases risk of death in people with asthma. The risk is unknown in copd. Anoro wont replace rescue inhalers for sudden symptoms and should not be used more than once a day. Tell your doctor if you have a heart condition, high blood pressure, glaucoma, prostate, bladder, or urinary problems. These may worsen with anoro. Call your doctor if you have worsened breathing, chest pain, mouth or tongue swelling,. Neil the president is meeting with a Law Enforcement roundtable on ms13, other issues. You never know what issues can come up. Lets listen in. We are joined by congressman peter king. Thank you. Congressman lee zeldin. You have been working hard on that. Mortgage that mcsally, youre working hard out there, that is the word on that. Barbara comstock. Barbara, good to have you. Congressman michael mccaul, an expert on this subject. Its a tough subject. Ms13 recruits through the broken immigration system. Violating our borders. Whatever they want to come through think come through. Much tougher now that weve been there. We need much better border mechanisms and much better border security. We need the wall. Well get the wall. If we dont have the wall, we will negative solve this problem. I have gone to the top people. Many are a the table right now including this group. Without the wall it is not going to work. During my state of the union i called on congress to close immigration loopholes that allowed this deadly bang to break so easily into our country my administration identified three priorities. We went through and, looked very closely. We have identified three priorities for creating a safe, modern and lawful immigration system, ending chain migration and canceling the terrible visa lottery. Weve been discussing it were talking about it in congress. Were talking about daca and how we can work that out. I dont think the democrats want to make a deal but well find out. As Congress Considers Immigration Reform it is essential we listen to the Law Enforcement professionals in this room today. I will turn it over to secretary nielsen. Well begin a discussion. You folks might want to stay for a while. Mr. President , thank you for hosting this roundtable on ms13. This gang is first dangerous enough to be classified as transnational criminal organization. We talked at length of the devastating destruction and violence it causes in our communities. Were hear to hear from a variety of folk who every day combat this this is my privilege to be here. Men and women of dhs, doj who make it their job every day to fight violence coming across our borders. Also to be joined by members of congress that have shown great leadership. We thank you for that. Always for your support of the doj. Thank you for you all. In your recentlyannounced framework as you know you asked congress to close loopholes we talked about. When we