on the same day that the senior u.s. military official was visiting that island in a show of solidarity with the south korean military and with the south korean people, the people of the island who understandably are very shaken after what happened on tuesday, when there was more than 100 according to some officials here, 170 north korean artillery shells rained down, destroying 20 to 30 homes, killing four people, then today, there was a concern, there was an alert. people on the island heard more explosions. they thought they were coming from the north. they thought it was yet another artillery assault. it was not. u.s. military officials say that there was no fire in the direction of the island. no splashes. no impacts in south korean territory. this was a message. north korea was carrying out some sort of drill within its own territory, but doing it at a sensitive time, doing it as it was certainly aware that u.s. military was visiting this island, sending a message that it does not support these joint u.s./south korean military exercises and it doesn't want the u.s. military any closer to its territory. >> richard, let me ask you about the headlines here in the united states of president lee of south korea has accepted the resignation of his defense minister. they are now changing the rules of engagement. what does that mean? >> a lot of this has to do with domestic politics here in south korea. there has been a lot of criticism of the government that they didn't respond quickly enough to the north korean assault. the culture here is very proud of its military. people here feel they should be acting with more defensive posturing. it took about 13 minutes for the south koreans to respond to that initial assault. and we have not seen any kind of big public appearance from the president of south korea. so he had to do something. he changed the defense minister and he said that he will relax the rules of engagement. that is what south korean officials are blaming for their slow response time. they're saying it took them too long to figure out if they were, in fact, allowed to respond to what people here saw as an unprovoked aggression. >> all right. richard engel there in south korea, thanks so much. let's bring in now nbc news white house correspondent mike viqueira. mike, how is the white house responding? >> over the course of the last several years, really, norah, the threatening gesture from north korea -- remember there have been underground nuclear tests, long-range missile launches into the sea of japan over the japanese mainland, most of the time the united states treats these threatening gestures as mere negotiating ploys. remember these on again/off again so-called six-party talks with the united states and awful of the countries surrounding -- all of the countries surrounding north korea and the countries with a stake in the region they have been off again for the last two years. north korea has used its nuclear program as a sort of carrot and stick, mostly stick, whenever the negotiations are off, north korea will let it be known they're ramping up their nuclear program. we saw that last weekend with the revelation they have this incredibly advanced uranium enrichment program. the north koreans after this later incident, more than an incident, live fire artillery on to the island where richard engel was reporting, saying we are on the brink of war as the united states under the direction of the commander of chief here in the white house, has the "uss george washington," an aircraft with many attended ships and submarines around it, heading into the waters off the coast of north korea for the joint navel exercise with south korea starting sunday. this is viewed as obviously a provocation of north korea. china how will they respond, even as the united states puts pressure on them to put pressure on their closest ally, north korea or north korea's closest ally in the world , to do something about these prove rotations. >> mike viqueira at the white house. joining me is william cohen former secretary of defense under president clinton and the chairman of the cohen group. secretary cohen, good to see you. thank you so much for joining us. you heard mike mention there are these joint u.s./south korean exercises going to happen on sunday and north korea is already saying this could push the korean peninsula closer to the brink of war. is that true or is that just a lot of talk? >> well, first of all, the exercise has been planned for many months now, so the timing is not a case of being planned in response to what the north koreans have done. secondly, north korea continues to engage in or well lee ann language. they take actions of provocation. they've murdered some 50 plus soldiers and innocent civilians without any penalty for that. now they're saying it's really come about as a result of south korean provocation. i think we have to really reduce what credibility they have, which is very little, in terms of what they say. they have been pursuing a policy of guns. they make the guns and provide the guns, we've been supplying, we and other nations have been supplying the butter. what we have to do is to continue to enforce the san sank-sanctions, make it more difficult for them. that's one of the reasons they've been acting in this fashion. they need food, fuel, sussy nence to maintain that regime. one of the key ways is through china and yet china has been one of north korea's allies, not allies, i should say, but talk to them. how important is china in this whole thing some. >> china holds the china card. they're the only country i think that can really exercise the kind of influence that needs to be exercised to call them back from the brink they're creating. china has been reluctant to do so. fear you can see a failed state if they take too aggressive action. on the other hand if they don't do something we're going to see a continuation of this crisis policy. and it's interesting, i know the chinese government says we have limited ability to take any action against north korea and yet, when it came time to forcing the japanese to release a captain of a fishing trawler that had been arrested for crashing into the coast guard, the japanese coast guard, they suspended the supply, they suspended the supply of rare earth minerals and right away the japanese released that captain. so i think they have the power. they have the power to go to the north korean regime and say, start acting properly or else we're going to start reducing our assistance. >> i think a lot of people and a lot of americans forget how many of our soldiers and troops are over in south korea still. i actually lived there growing up for several years. how many thousand -- tens of thousands of troops we have there now. >> we have about 28,500 in that range. >> let me ask you, how much do you think of this as a show of force by the north koreans given the succession that's going to go on from president kim jong-il to his son? is this action dour think it's more than that? >> i think it's a signal that they're -- they're going through a transition now from a father to the son and this is a way to beef up his credentials with the military. it's rather ironic i think or at least unusual to have a 25-year-old four-star general. apparently they're trying it to give him some credentials. there's always a danger on the part of the west when you have a younger military person take over when you're looking for a break through. i think it's unlikely we're to see more confrontations in the future and that's why the u.s. response has to be coordinated with the south korean government. we have to put more troops in the region and i would recommend putting some f-22s over in okinawa on a contingent basis for some time to come. >> wow. i love how polite you are about the how unusual it is to have a four-star 25-year-old general. but that's what happens when you're the son of the president in north korea, right? >> yeah. he's a very highly intelligent individual who can climb that rank so quickly. >> secretary cohen, good to see you. thank you so much. and now to the complex politics surrounding the standoff in korea. jonathan allen joins me live from philadelphia and karen funny a political analyst and former press secretary for hillary clinton. good to see both of you. thanks so much for joining us. jonathan, let me start with you. how dicey is this situation for the white house and for president obama? >> i think it's diceyer for the south koreans right now. this is an ongoing problem for the united states. north korea has been able to do things with relative impunity. we haven't struck back at them in any way. we are no longer in two party talks, six-party talks and now the talks are gunpoint talks. it's a dicey situation, but no more so i think than it was a few weeks ago a a few months ago, it's an ongoing situation and the president is deciding it wants to make clur we're going to support the south koreans if it comes to that. >> jonathan, the response from the white house, was immediate when this happened. the president was awoken in the middle of the night by his national security adviser. what's next? >> i think what's next is waiting to see what happens. i mean, obviously, we've got this exercise with the aircraft carrier group going over there. you have the transition of power from the north koreans. are they going to continue to send missiles or send strikes over at south korea or are they going to continue to sink ships or are they going to back down now that they've sent their message they are going to continue to take sort of a strong man stance toward their neighbor? >> jonathan, we know the president has been thwarted by some republicans in the senate on the start treaty. give now this provocation by the north koreans, do you think this helps the president with that? >> i think it remains to be seen. really it's down to senator kyle from arizona and what he wants to do. we have to hear what he has to say about this going forward. i think -- i think they are generally speaking separate issues. obviously those who would want to combine them to make a point on what one side or the other would do that. the sort of larger question of strategic arms reduction is a larger question than just this north korea issue. >> and karen, i think we were able to fix your audio and microphone. i wasn't leaving you out of the conversation. >> that's okay. >> but as we were just talking about the president, but you know, of course, he has this big meeting next week with the republicans, bringing them over, the leadership over to the white house. do you think this helps the president? i was just asking jonathan about this in terms of the way he's being thwarted on start, that treaty that he's getting some push back from republicans. >> you know, it's interesting. i do think i disagree with jonathan a little bit. i think what's happened with north korea, should serve as a reminder just about how interconnected the politics actually are. one of our most important allies in trying to force china or push china to step up and take a greater role with north korea is russia and russia is very interested in having a start agreement and interesting enough, you had actually the gentleman who did the original start treaty for ronald reagan who said last week, i believe, that it's iran and north korea are the two countries that would like to see us not sign the start treaty. i don't see how you can't see these things as being int interconnected and creates a little political pressure for the republicans who are continuing -- senator kyl in particular who are holding out on the start treaty and this idea that nuclear proliferation is a very serious issue of our time and one that we, you know, need to deal with very forcefully and very quickly. >> all right. karen funny, jonathan, thank you so much. we appreciate it. >> take care, norah. and shoppers are scrambling to get their hands on black friday deals this morning, but many customers already scored big when a handful of stores opened at midnight and yes, there were some die-hard shoppers that got an even earlier advantage with a group of stores staying open on thanksgiving. there's those pictures we see every year. cnbc's darren rovell is live at the westfield garden state plaza in new jersey. looks like a lot of crowds there. >> yeah. we're really impressed with the crowds, norah. first of all a lot of people were confused when they showed up at walmart like at 11:00 p.m. yesterday and they didn't get the black friday deals. since it wasn't friday. they were open 24 hours. here just a lot of people, more than last year, certainly. it seems anecdotally they're spending a little more, they feel better about themselves. the big deals, electronics, at best buy, they're essentially giving away 32-inch tvs if you want them, although everyone is going for 42, 55 these days. you should also probably get the gps devices since they're almost free as well. a lot of teens here. they're going to stores like hollister and old navy. apple, by the way, probably had the longest line here this morning and they're only giving 10% off. that's not a deal. but i guess it was enough of a deal that people wanted to get their ipods, whatever they can get, apple is obviously such a hot brand they don't have to discount and yet they still can get lines here. norah. >> all right. thanks so much, good to see you. happy shopping. and some more on how shoppers can get the best deals, regina lewis is an aol consumer adviser and joins us now. good to see you. what's the key? if you're going to go out shopping today, how do you find the best bargains? >> i think the key is you want to raise your hand for their social marketing campaign. whatever your favorite retailer is, it's a good idea to sign up for their e-mail news letter or sale mail. become a fan on facebook, sign up for twitter feeds. they'll start to send you spot discounts, special codes, not just because they're trying to be good to loyal customers but frankly, they want you to share that with your friends and family. you become part of their viral marketing campaign. so it's very smart to get on those lists. >> so regina, what if you don't want to go to the malls, don't like the crowds there, are there a lot of same deals on-line? >> sometimes they're the same. a lot of major etailors are the major retailers, macy's nordstrom, best buy, target, walmart. you can see some of the same deals. you'll also see on-line exclusive deals, amazon has something called lightning deals, roll out about every half hour, limited number of quantity for limited time. you got to be decisive. and remember it's not yours until you actually complete the checkout process. it's not enough to have it in your shopping cart. people get burned on that. we're seeing some combination of the same deals or same promotion meaning 40% off in store 40% off, in line and on-line exclusives. >> i was reading in the business section of the papers today, retailers are really optimistic about this season in sales after several seasons when sales were down. what's driving this? what does it say about our economy some. >> i think it is good news. expecting 138 million shoppers, 48% of consumers. people are still using cash. there's a tendency to use debit cards. people are mapping out their spending but appear optimistic. even in the luxury sector we're seeing people go after value but starting to buy watches because they have intrinsic value because you can pass them down to their kids. they are buying higher end items and that's a good sign as well. >> good tips. thanks so much. and end of the year looking at your bank balance i'm trying to figure out how to get financially on track. we'll have some tips for you. all that coming up next. 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(high-pitched laughter) man: hey you dang woodchucks, quit chucking my wood! vo: geico. fifteen minutes could save you fifteen percent or more on car insurance. stella: hmmm. we're getting new medicare benefits from the new healthcare law. jane: yea. most people will get free cancer screenings. and 50 percent off of brand name prescription drugs if you're in the donut hole. stella: you read my paper. jane: i went to medicare.gov. it's open enrollment, you know. so i checked out all the options and found a better plan to fit my budget. stella: well, you know what they say...knowledge... jane: knowledge is power. environmental groups say the obama administration needs to do more when it comes to protecting endangered species. the fish and wildlife service says 251 species are candidates for protection under the endangered species act. president obama has provided protection to 51 plants and animals under the act since taking office. the end of the year marks an important time for your personal finances. over the next few weeks americans will be make something key decisions on everything from health care plans to tax withholding. let's bring in our personal finance expert. good to see you. this is an important subject, certainly people are thinking about it. what are some of the big issues that people need to tackle before the new year? >> well, understand that 2011 a lot of tax uncertainty, but there are a few things you can manage today starting with your health care options. make sure that you know you have enough health care going into the new year. a lot of companies are offering open enrollment for their employees so make sure you are choosing the right kinds of plans. if it makes sense to go on a spouse's health care plan, maybe that's what you want to do, or you want to perhaps open up a flexible spending account for all those out-of-pocket medical expenses you anticipate in the new year that can be tax deductible. that's health care. the other area you want to look at is your stock portfolio. if you've had any losses in 2010, perhaps more losses than earnings, know that that's often tax deductible. that's called a net capital loss and you can deduct up to $3,000 of net losses. if you have beaten down stocks you haven't sold maybe now is a good time to do it. i would recommend looking at your retirement account. half of baby boomers right now going into retirement they're going to run out of money at some point. if you're in that category, know that you can really play some catch-up for 2010. the 401(k) plan you cannot -- you can contribute up to $16,500 per year. your ira, another $5,000 or if you're over the age of 50, a $6,000 catch-up contribution. if you haven't made these maximum contributions and you some money to play with, this is not only great for your retirement but a potential tax benefit for you in 2010. >> and then just one other thing. credit cards, everybody is using a lot of their credit cards today, black friday, and getting ready for the holiday season. just a quick tip if you will on how to use our credit cards. >> how to use your credit card? leave them at home. or if you are going to -- >> exactly. >> a lot of companies, stores, offering lay away programs as well. that's an alternative to using the credit cards. if you can stick to cash. look, 80% of shoppers say they will try to stick to cash this holiday season. that's a big development in 2010. i think if you can do that, you're going to have no debt hangover in 2011. what a great holiday gift for yourself. >> exactly. great advice. if you only have one credit card it's only one bill you have to pay or keep track