nicole: there was a lot of shock here. right in the morning we heard about the fact that he was stepping down and quickly to follow was the chief operating officer. we learned that he was clashing with the board on many things such as strategy, performance, the morgen stanley unit was big in that and other things as well. right now you see citigroup has been all over the place. it has been higher by three quarters of 1% after being down at a level of 35.55. people digesting what we have been seeing from citigroup. as far as the major markets, dow jones up triple digits. just went through the dow 30 and some of the names that hit 52 week highs. i have five names for you. johnson and johnson, traveler about walmart, merck and pfizer. they have hit 52 week highs. we continue to follow the nasdaq. it is tacking onto yesterdays gains. you can see all three of the major averages. another factor that we will continue to follow is gold. it is up eight dollars today. dagen: thank you. connell: let's go to charlie gasparino to expand on this citigroup scandal. charlie: i think it is less of a resignation and more of an ouster, fired, clearly, he was shown the door. the timing was on. the guy that is replacing him did not want to read the earnings call and be asked a million questions so they did it this week. i am getting back from a source pretty close to citigroup. almost unprecedented way that this happened. you do it with earnings or before earnings or in a way that is less. you do not normally do it a day after earnings. it is what it is. why would he be fired? i can tell you that the board, you know, if you add up the missteps since 2008, they are monumental. he had real supporters on the board in the past. he left morgan stanley. it imploded, but pandit stayed. when bob left, he lost a key ally. while a kind of stabilized, you could point to a lot of things. the feds said is basically failed. citigroup was not meeting its stress test parameters to do that. part of a deal during the financial crisis, they kept the peace that they recently sold on the books at $5 billion more than it should have been. there is a lot of missteps. they essentially ousted him. they did not like the job he was doing. john was with them. there is lots of speculation out there about that involvement in the libor investigation. there is talk, pure rumor, and insider trading investigation in india. there is a lot of side issues. we will probably take the whole day to sort it out. my guess is that he was ousted. he was shown the door. there is plenty of last straws. i think this was the last straw. maybe there is something else after that. the board said they had lost confidence. that is what all my sources are saying. back to you. dagen: thank you so much, charlie gasparino. connell: we will hear from him throughout the day. if you look at some of these numbers coming in, this is some other minority numbers. ten have left. dagen: joining us now is former managing director at bain capital and author of unintended consequences, what everything you have been told about the economy is wrong. that should work very well for mr. romney tonight. that should be the easiest sell, but he has to go up against the president. >> should not be surprised by this. very high levels of government spending and higher taxes which are to follow eventually. they have very low workforce participation rates. they are in the 50s and we are in the 60s. you have europe and france having 35% less average hours of work. i think this is the result of government policy and people look forward into the future and see what is coming. this has an effect on our economy today. connell: everyone is expecting this new and more energetic and more aggressive president obama to take on mitt romney. will there be a different mitt romney are pretty much the same thing we saw in the first debate? >> hard to think he can get any better than the first debate. connell: does he have to make any adjustments? >> them -- the mitt romney i worked with was the same in the debate. connell: look like them that you worked with? >> asked tough questions and having that information at the top of his head and able to put it all together and see where the issues and some point in your argument are. he does it in a polite way. dagen: if someone goes after him a little bit, it is all very subtle, how does he react? does he have to be careful he does not get a little edgy? i do not know. >> he is a passionate guy. he can get quite passionate. that generally occurs when you are talking nonsense or trying to cover up for the fact that you do not really know the facts. you start bf. connell: did he ever chew you out or he would come at you with numbers and here is why i am right? >> i would not say he chewed me out, but he disagreed with me and i disagreed with him. i am a pretty passionate guy as well. dagen: does sophisticated hurt him? >> i think it can. it is unfortunate in these debates where you get two minutes to answer. you cannot really dig into the facts that underlie the economy. i do not think that these debates format and this type of thing really plays to the strongest part of mitt romney. connell: what do you think was missed maybe the first time around or a big economic point? >> i think the obama administration has a very good campaign strategy, it is a very bad economic policy. you run up $1.1 trillion of deficits and you pretend all you have to do is raise taxes on people earning more than $250,000. then you fight cost reduction every step of the way. it increases the middle class taxes. is it romney or president obama? a dollar spent is a dollar taxed ultimately and we will have to have much higher taxes if we continue down this path. it slows down our economy and employment. very difficult to communicate that in the debate. connell: you did a pretty good job of it. dagen: it was great to see you. thank you for being here. a lot of insight there. we cannot wait for tonight. >> i will be there. connell: so well neil. dagen: yuko watches coverage tonight. he will be right here and about 20 minutes time. connell: we will talk to neil coming up. china will lose it top billing soon as the top creditor to the united states. dagen: feeling more confident. should you feel the same way about the housing market? let's take a look at oil. consumer inflation was up last month. oil is stubbornly above $90 a barrel. ♪ dagen: sure to come up in tonight's presidential debate, the amount of money that china has loaned to us as a nation. the peoples republic is about to lose its place as this country's largest creditor. who takes the top spot? well, japan. china's holdings fell through the month of delight while japan has raised its stake. fox con, an unspecified number of 14-year-old interns were discovered working in one of the factories. the minimum working age is 16. the maker of the products is investigating the incident. they say fox con is at fault for not verifying the age of its workers. connell: back to nicole petallides at the new new york stock exchange. nicole: we are looking at goldman today. they beat the street. we are looking at the stocks. we are watching goldman stocks. it boosted the dividend year over year. they sought better numbers for investment banking, also fixed income trading. the headcount is something we saw down 5% from one year ago. clearly, goldman sachs has been cost-cutting in the recent quarters. you have seen a winning day on wall street. dagen: ed pinto is coming up. they are feeling more confident. should you? dennis: still to come, neil cavuto. he will be talking about the debate tonight. he will be leading our coverage. stay tuned for neil. right now a pretty big rally in the stock market. ♪ i'm a conservative investor. i invest in what i know. i turned 65 last week. i'm getting married. planning a life. there are risks, sure. but, there's no reward without it. i want to be prepared for the long haul. i see a world bursting with opportunities. india, china, brazil, ishares, small-caps, large-caps, ishares. industrials. low cost. every dollar counts. ishares. income. dividends. bonds. i like bonds. ishares. commodities. diversification. choices. my own ideas. ishares. i want to use the same stuff the big guys use. ishares. 8 out of 10 large, professional investors choose ishares for their etfs. introducing the ishares core, etfs for the heart of your portfolio. tax efficient and low cost building blocks to help you keep more of what you earn. call your advisor. visit ishares.com. ishares. ishares. yeah, ishares. call 1-800-ishares for a prospectus which includes investment objectives, risks, charges and expenses. read and consider it carefully before investing. >> at 21 minutes past the hour, i have your fox news minute. in infectious disease expert, the meningitis outbreak is nowhere near its end. they are worried other medications made by the same company that manufactured the painted black steroid may also be contaminated. it has killed 15 people and sickened more than 200 others. secretary hillary clinton is taking the blame on the terror attacks in benghazi. she is possible for the state department and safety. she blames the fog of war for the confusion of details surrounding the incident. a high-priced hype at eight museum. a thief got away with seven paintings. police are now reviewing video footage, but so far no one is in custody. that is your fox news minute. back to dagen. dagen: thank you for that. somebody is feeling good about housing. confident soaring to its highest level since june 2006. it is the sixth straight number that the number has moved higher. ed pinto is here now. is there any other reason to be excited at this point? >> not really. dagen: [laughter] all right. interview is over. got to go. >> the homebuilders have a headache. if they getting better or worse or less painful. it is getting less painful. but they still have a headache. when you look at the actual hard numbers, such as what our home sales, they are running around a quarter thousand which is way down. they are still down about 50% from the early 2000. when you look at how many homes are available, we are down below 150,000. that is an it certainly low number. that is what is happening, obama sentiment side and on the objective side. when you look at the overall market, you have basically three problems. while affordability is tremendous, you have this overhang of potentially unsold inventory and shadow inventory that is coming on from foreclosures and defaults. you have house prices, they bounce back some. they are still 30%. the big issue is jobs. we have had a jobless recovery. as a result, it really takes jobs to create demand for housing, not the other way around. dagen: stay on that note, is the economy strong enough at this point to sustain the recovery that we are starting to get? >> i think it will be, at this level, it is a slow recovery. it has a lot of headwinds. in order to get rid of those, you have to get jobs growing much faster. some different policies than the ones we have been following. we really have to get private-sector jobs growing and that will take care of a lot of the problems. dagen: you can get a mortgage, though, can't you? >> half of the home purchases are done with fha. not with fannie and freddie. you can get a loan with a very low down payment. the problem is, do you really want to get a loan, do you have enough confidence to take out a loan. do you have a job? is your income sufficient? what is going on in the marketplace and can you sell your home because it is underwater. you have a lot of headwinds. dagen: i want to get a mortgage if i do not have to put any money down and the burden is on the government. it is the taxpayers problem, not mine. >> we have heard that story before with fannie and freddie. dagen: ed, thank you so much. ed pinto. connell: we have neil cavuto standing by. he will join us here in a moment. he will tell us what he is expecting in the big presidential debate tonight. dagen: now some winners on the s&p 500. ♪ dagen: more on the house of citigroup vikram pandit. charlie gasparino reported that he was forced to leave. connell: the author of the book exile on wall street. one analyst fight to save the big banks themselves. we thank him for joining us. it was short notice today. your thoughts on the move here from the board at citigroup. >> there is no bigger critic of vikram pandit than me. while he has been ceo caught it has been the worst. i do not feel as though citigroup had proper oversight from the ceo since he has been in place. i think the board has actually taken, you know, a step where they probably wasn't too a few shareholders. it is the way this whole transition has come up is eye-catching. dagen: he has been there for three decades? >> a company like citigroup, it is tough for any one person to run that well. i am keeping an open mind. i think sometimes a change can be positive. i think citigroup has had some of the worst corporate governance under vikram pandit. i think the way this transition has taken place is part of that. here you have not only the ceo, you have both stepping down at the same time. zero transition. and it was one day after we listen to the ceo talk about the long-term strategy. what is taking place here? by the way, where is the conference call with the new ceo? this has been awful. that is the opportunity and challenge of the new ceo to approve a culture that has led to a lot of mishaps and underperformance. connell: you are right it is really. to have the earnings come out and then this move be made. you have been a critic of vikram pandit. why do you think it happened this way and to expand on the point about corporate taking over, is he a long-term answer? >> i am not sure. i think you had one warning sign. 182 days ago was a negative -- and what that is, the shareholders spoke up and said we do not like the executive compensation plan. with good reason, it had artificially low hurdle rates where the top executives would get incentive pay for earning one forth of what they earned the prior year's. work better concrete example of some concern among shareholders than that. then it is played out here. there must be some sort behind the scenes. i do not know what it is. this is a ludicrous ceo transition. i have never seen one like this in my 25 years and covering the industry. dagen: will this be a better bank a year from now? >> i hope so. i think what they need to do is have more clear goals. under vikram pandit, one day it was let's grow assets, then the return that was one half above the industry average, yesterday they had a few new metrics they were showing, everybody needs to be on the same page when it comes to goals. the actions need to be more aggressive. i asked a question yesterday, why not be more aggressive in the ceo said there is not funding for people to buy these assets or, perhaps, they are not written down as aggressively as they should. then they need to show that shareholders matter. it has been a culture where shareholders do not matter enough. look at their disclosure. the company would not disclose the basic measures of risk. why would they not disclose that? also they do not disclose risks by business line. you take that, you take the compensation seem that looks pretty red in it comes off with an attitude that shareholders do not matter. connell: we will run in a second. i am not even sure i need to ask this question for some who causes the most ludicrous ceo switch you have seen. what are you told to do with the stock? >> last time i recommended it -- it is down. a current price target is not that far from where the stock is right now. when we look at this company, we are saying we still have very big concerns. we are having an open mind. we still need to improve the oversight of the company. connell: thank you for calling in, mike. dagen: neil cavuto interviewed vikram pandit several years ago. he could not get him to give a straight answer. neil said chocolate or vanilla and his answer was swirl. connell: speak of the devil. dagen: could you be more of a nerd? connell: that is no way to talk about neil. neil: i remember that well. you could not get a straight answer. that vanilla and chocolate question was a genuine answer. do you like anything? connell: do you want to weigh in on this first? neil: it is not the way you handle a ceo transition, we had a smoother process for arranging elected leaders of the free world. citibank, even after all the billions, is that a screwed up company. dagen: $45 billion. they can send us all thank you notes. neil, tonight the debates always contain surprises. what do you think will going to be the wild factor to look out for tonight? neil: this may be a tough venue for that to happen. you are involving a studio audience asking questions. the host wants to be able to fine tune those questions. we will see. i think it is harder to go directly after your opponent when you are really responding to questions from the audience at hand. although, bill clinton was pretty good at this and 1992. he would immediately take the question, turn it around to a central campaign theme and then george bush senior, the incumbent, this is what has not been happening under his stewardship. there is a way to turn this into your advantage. for the president, this is a very challenging venue. connell: even to pull an al gore which would be one of the risks tonight if you are trying to challenge mitt romney. neil: do you remember that? connell: yes. it was me and dagen call anchoring. neil: because you have a town hall format, there will be cut away shots on the other guy. they are aware of that. i think, particularly, the president is. candidates have not even brought their watches before. i think you want to watch the eye rolling, the hissing, the sign, maybe the joe biden smiling and laughing thing. i guess everything in moderation will be key. i am always wondering what will be key. why didn't the president look at mitt romney more in denver? i did notice that romney constantly looking at the president to his face. at some level, that obviously registered. whatever the substance of argument, it was that constant smiling and almost -- it was a little unsettling. it tends to get people sidetracked. i don'ttknow. i don't know. i think they should bring chicken wings and make it relaxing. dagen: i would love that. ask connell about the frozen smile on his face. it is the only way he can get through his day with me. neil, one thing that the "wall street journal." point out was that mr. obama did seem to be that mr. obama seemed to be very critical of mitt romney and his proposals rather than selling his own record or at least selling what he will do in the future. do you think we will hear more from the president on that note tonight? neil: i do not know. i will say this, the criticism of the president was that he did very little to sell his own policy and let that romney so his. the criticism of joe biden was he would let his opponent get out his policy, he was too busy ripping there's. there may be a fine line in between. i do not know why we always say that. there is nothing unpresidential about getting in someone's face. it seems that there is. if you were the president and you realized you had a lousy first debate, you can pretty much say given the tight polls on the vice presidential debate that your vice president did, at the very least, a better job than you, it is upon you to be a little more aggressive without seeming like you are, you know, high as a kite. how they pull that off, i do not know. the pressure is on the president. this is where all the debates have been built much like this duty studio audience. he has had 100 such venues. the president under a dozen. you did the math. that is a lot of practice