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stuart: i like this long, gets me going. i'm going to comment sixth avenue new york, midtown manhattan on a cold winter day, they almost deserve each other. people should be at work today, february 1st. good morning, every one. it's 10:00 eastern time. on the markets this morning we see a little bit of green, dollars up 2, s&p up 13, nasdaq close to 80. the 10 year treasury yield is coming down, down to 3.91%. the price of oil not doing much despite what's going on in the middle east, $76 a barrel and bitcoin, $42,600. just in, latest read on manufacturing.

lauren: contracted but a stronger number, the number is 49.1, increased in january can we accept a decrease. prices paid, this is inflation, the number was around 45 in december and in january it rose to 52.9. stuart: but the market just edged a little bit higher on that 49 reading. just a fraction higher, not much. the dow is up 26. thanks very much indeed. now this. i think we could a turning point. when you see something like this you know things are breaking down. those migrant thugs beat two police officers in times square, new york, the four illegals arrested were released three hours later. this is one of the most obvious signs of breakdown. there are plenty of others. the border, come on, there is no border, 8,600 illegals cross

every day. if that's not a breakdown, what is? chicago, new york, boston overflowing with migrants. crime in epidemic proportions in the nation's capital. in oakton, california, too dangerous to go outside for lunch. foreign policy, the chaos in afghanistan started the rot and it has gone downhill from there. the democrats are hopelessly divided on israel, and last night two democrats voted against keeping hamas operatives out of our country. that is a moral breakdown. wears a respect for america? those thugs who beat police officers in time square have no respect for the cops paying them to be here illegally, america's not looked up to. so many things have gone wrong. inevitably biden's failures will be compared to trump's successes and also compare biden's declining cognitive ability and total lack of energy to trump, the energizer bunny who enters any and all questions rapid style and seems

to get a lot of things right. wednesday we compared biden to jimmy carter. there are strong parallels and here's another. a malaise dissented on america in the carter years. second hour varney just getting started. governor mike huckabee joins me, former governor of arkansas. have we reached a turning point in your opinion? >> i think we have. what you said nailed it. when you have police officers beaten by people who shouldn't even be in the country and they were arrested. not that we couldn't find them. we found them. they get released from jail before the cops get out of the hospital. we are broken down, better believe we are and it better be the deciding factor in the

election so we can turn off the lights and call it a day and call ourselves some thing else because we will no longer be the united states of america. stuart: nikki haley once again went after trump. role fat tape. >> he has made it chaotic. he has made it self-absorbed. he has made people dislike and judge each other. a president should have moral clarity and know the difference between right and wrong. and he is just toxic. stuart: look at this. new national survey shows biden trailing haley by five points in a hypothetical matchup. haley is 5 points out front of president biden in a matchup. haley beats biden 47-forty two. you are a trump guy. presumably you think haley should drop out. >> i don't think she should drop out because i think so.

she's got to make that decision. i've been a candidate and the worst thing in the world is having people tell you you need to get out. that the decision you have to make. i've said this many times. it is harder to get out of a race than it is to get in one. you put your whole life into it. so i will let her stay as long as she wants to until donald trump has enough delegate votes and it's over and that's fair enough about let me take issue with what nikki haley said. she blames donald trump for the chaos. it is not donald trump it created the chaos. it's the lawlessness, the fact that he went after the deep state and the deep state said we can't allow this man to expose us so they create fake dossiers, go after false charges, have two phony impeachments, file criminal charges in every court they can imagine, the chaos is the chaos that in our country. it's the chaos we better have a strong leader to stop and this idea that it's donald trump's fault we have chaos, no, he may

be the only person who can stand up to and fight it and beat it and save this country because if nikki haley doesn't think she will have chaos if she's elected then we can't afford to have nikki caley and office. stuart: sarah huckabee sanders, governor of arkansas, your daughter, is she going to be donald trump's vice president? >> i have no idea. i think she loves the job she's doing, she's good at and aired and everything i've heard her say privately and publicly is she wants to stay in that job. she's only been there are year. she's getting great things done and my perspective is she loves the president, she's campaigning for him, wants to do what she can to keep him back in office but she wants to continue to do the work she's been elected to do by the voters of arkansas and i don't blame her. being governor is the best job in politics.

stuart: i think you should join the state department. you are a brilliant diplomat. governor huckabee, thanks for joining us, always a pleasure. dave portnoy revealed who he likely supporting in the election. can't believe it is -- >> it's trump but not a full throated endorsement. watch here. >> i described myself as a libertarian is, i am conservatively, financially, socially liberal but i am a people person. i've said this many times, i don't like either candidate we have right now. having said that, it's a no-brainer. i would vote for trump over biden. not because i think trump is the perfect guy for the job. i just biden has dementia. lauren: he said he loved trump in 2016 because he thought he would break things, he still

likes trump but says we need a unifier in chief. that was supposed to be moderate president biden in 2020 but that's not what we got. stuart: back to the markets. gary, no rate cut in march, is that bad news for the market going forward? >> the free market has taken over. i'm talking the free market of yields and when jay powell was way behind when interest rates skyrocketed the market got hit and now he's on the other way at 5.5%. if he stays up too long it could be trouble but the good news is we are at 3.9%, so much better. stuart: i know you jumped into some big tech stocks a while ago.

are you buying some more now? there's a big dip in big tech. >> not yet. i told you last week i sold some down but i still have my nvidia, microsoft, facebook, fingers crossed about earnings today. i will wait and see what shows up. the good news is there were some beaten up stocks on earnings but microsoft after an ugly yesterday is up $9 so the big institutions are not worried that microsoft's earnings, if earnings come in well, evaluations in the trees, trees can keep growing if they wanted. stuart: donald trump is looking strong, looks like he could win in november. is that a plus for the market? >> the good man adam johnson said something i agree with.

regulation. the fact that this president right now, i call him a control freak. each and every business trying to control, you see mergers being stopped, not good news. donald trump comes in and the perception is he is going to loose enough regulations, we the people do our thing, that will help markets and help profits and we can get going higher even more. stuart: wouldn't that be nice, thanks for joining us, see you soon. lauren, i want to start -- that thing is way down. stock is down 4%. >> they make everything from aircraft air-conditioners, they forecast a week first-quarter because they are seeing lower demand for what they make and what they sell to their customers. stuart: at&t. lauren: they got the stamp of approval from jpmorgan, stock is up 1.5%, jpmorgan upgraded them to a bar, 20 one dollar price target, they see

consistent execution on their wireless business. stuart: icy peloton. todd: $4 stock, they are seeing signs of improvement but cut full-year revenue forecast. the ceo has been on for two years, trying to turn around the company. they are having trouble bringing in paid subscribers to their apps. if you're going to look for good news, it's the fact that they are selling their bikes and treadmills at retail stores like to sporting goods but also on amazon and they are seeing positive momentum. we want sometimes things come and go, can't get them back again. it's very difficult. thanks. in 15 minutes defense secretary lloyd austin will hold a press conference, first time he's done that since his hospitalization. we will bring it you. senators grilled big tech ceos over their failure to protect children on their platforms but local governments are already taking matters into their own hands. grady trumbull will tell us how they are reining in social media. government watchdog group from

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stuart: 45 minutes into the trading session, some nice green, this is a bounce from yesterday, doubt nasdaq up one hundred 27, so is the dow up one hundred 27. big tech ceos justified on the hill about children safety on social media platforms, but local governments are not

waiting for washington to make the moves. grady trumbull with us. tell me how local governments are protecting kids on social media. >> several states are taking action, passing laws restricting kids use of social media or requiring parents to give permission for their children to use it. these are some of the states that have passed age verification laws are the protections for kids on social media but here's the problem which every single one of them is being challenged in and is tied up in the courts. the industry group net choice represents several of the big social media companies and has brought several of those lawsuits. here's what it says about utah's a lot. their effort was well-intentioned, the pet they chose violates the constitutional rights of all u-turns, their chairs are in and their businesses, compromises their data security and strips away their parental rights lodz a bill making its way through florida's state legislature could face similar challenges, they artie passed the state house, now the senate

will vote on it. that bill would cut off anyone under 16 years old from using several social media platforms. after yesterday's hearing when somewhat big social media execs, i asked senator lindsey graham his message to parents who are frustrated with congress's in action. >> we bear some of the blame absolutely. senator durbin and i want results. here's what i told members of the senate. i'm not telling cannot tell you how to vote but you need to vote. >> reporter: he will reach out to speaker mike johnson to get his counterparts in the house to work on this issue protecting kids on social media. stuart: a government watchdog group found that the irs has not remove tiktok from their employees phones despite the platform being banned on all government devices. senator john clune -- senator john thune from south dakota jointly.

does beijing have our tax information? >> that's a good question. good morning. that's what we are trying to find out. the irs like all government agencies had to have these tiktok devices banned in the workplace. that was a 2022 law. the irs has a report suggesting they are not complying with the law and we want to know how many irs employees have personal devices, how many have access to confidential taxpayer information and what are they doing to keep that information safe? the ccp would be interested in the tax information of american businesses and individuals so this is a serious issue and the irs needs to respond and ensure that americans confidential personal tax information is kept that way. stuart: i don't wish to be sarcastic but don't hold your

breath on that one. >> that the experience we had with this irs, but we will keep pushing. stuart: the white house is ramping up its attacks on house republicans after they opposed the bipartisan border deal. watch this. >> house republicans have tried to stop the president from delivering the resources we need at the border. house republicans are going further and signaling they may refuse even to consider a historic bipartisan border security deal that would strengthen america's national security. house republicans change course from their years of playing politics with this issue. stuart: the white house is saying republicans are using the border issue for political purposes that will never come to an agreement because they think it will make them win the election. what your response to that? >> the house already passed hr 2 which is a strong border

security bill. it passed through the house last year. it came up in the senate. republicans in the senate, not a single democrat in the senate voted for it. the house has acted. the administration, trying to negotiate now in the context of supplemental appropriation bill that supports ukraine, the indo pacific and israel, strong border for security provision. we had a proposal in the first of november, the white house didn't come to the table until december and they didn't put their first parole proposal in front of us until january 8th. they have slow walked this. they don't want to deal with the issue of border security. this is the blame game going on but house republicans passed legislation, sent it to the senate and we had a vote in the senate, not a sickle democrat voted for it. this white house, the democrats on capitol hill, this is not an issue they want to address and they have to be forced to do it. a when as you were speaking we

were running video of a speedboat pulling up in san diego, dumped on the beach and the migrants running out. do you think we have reached a tipping point with the migration in the border? >> we reached a tipping point and it was avoidable. the administration has tools at their disposal to address of this, they have chosen not to. which is why if it's going to happen they have to be forced to do it and that's the reason we are considering legislation up here. i don't know alternately how it's going to come out but at the end of the day this is a problem of their own making. this administration, president biden when he came to office completely reversed and undid all the policies that were in place under the trump administration which were effective and working and decided to have an open border and so now there's a big green light, big welcome matt, people are taking advantage of it, 302,000 in the month of december alone. it's a huge crisis and has

ramifications that go deeply into our national security interests. stuart: donald trump is going after president biden after he announced he is going to east palestine a year after that toxic train derailment. why do you think biden is going now? >> it is political optic. its theater. he hasn't done anything for a year and now he decides to show up. let people see that for what it is. i assume the people of east palestine will see it for what it is. stuart: four subject in four minutes, that is news efficiency, mr. senator. you are great, thanks for joining us, appreciate it. the house passed a bill to ban hamas terrorists from entering our country. two members of the squad voted against it. we are all over that one.

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stuart: momentarily we should see lloyd austin, we will take you there when it starts. plenty of green, different from yesterday. nasdaq tied, we want to know about target. >> upgraded them to a by, 176, it is a nice commentary, expect consumer spending to return. stuart: new york community bank, down yesterday and today. lauren: yesterday they reported a quarterly loss cutting the

dividend, they are worried about the credit risk surging. bank set aside millions to prepare for future losses in march. stuart: this is a ripple coming through now with the community bank. 80sy. lauren: they added a partner, activist investor to the board of directors, there are reports that elliott has a stake in etsy, it is over 50%. stuart: thanks. lawmakers in portland, oregon declared a state of emergency over the fentanyl crisis three years after the state decriminalized possession. jason rantz with me now. a state of emergency. what does that mean? >> doesn't go far enough.

they are doing more of the same, putting resources into getting folks onto the street, social workers connecting people with resources but no benchmarks for success in the 90 day emergency call, no arrests of people doing drugs out in the open so it seems like it's just doubling down on a failed policy because they refuse to go away from something called heart production, a strategy that is supposed to mitigate the risks of drug abuse by enabling the drug user, giving them drug paraphernalia but there are no consequences at this point when it comes to drug use from a legal perspective so no pressure for anyone to stop doing the drugs and it will create a vicious cycle that will continue. stuart: next case. the parks and recreation department in austin, texas is under fire, after they are

racially segregated antiracist training programs, white folks are not asked to attend the meeting, it was only for people of color. is antiracism training necessary? >> no. at the end of the day it ends up creating racist. it creates division to begin with, we are separating folks, just happening all over the place where if you are white you go to one group and are told you are the cause of society's problems, you are inherently racist, just don't realize it at if you say you are not racist you are definitely racist. stuart: secretary austin is speaking. >> if you have a question, weight to be recognized and i will call on you. >> thanks. good morning. it has been a difficult few days for the department of

defense and the entire department is united in our outrage and sorrow over the death of three servicemembers on sunday. we all mourn the loss of three are reserve soldiers, sergeant william rivers age 46, sergeant kennedy sanders, age 24, and sergeant breanna moffitt, age 23. our thoughts and prayers are with their families and loved ones and we know this grief will never leave them. we hope that they know that the department's love and support will never leave them either. we are also praying for the other american troops. teammates were killed when a 1-way attack drones struck their living quarters. we continue to gather the facts about this deadly attack. our fallen soldiers had a vital

mission to support operation inherent resolve and to work with our partners to ensure the lasting defeat of isis. they risked their lives and lost their lives to keep their fellow americans safe from global terrorism. the president will not tolerate attacks on american troops, and neither will i. our teammates were killed by radical militias backed by iran and operating inside syria and a rack. in the aftermath of the hamas terrorist assault on israel, on october 7th, terrorist groups funded by iran have tried to create even more turmoil including the houthis. attacking commercial shipping in the red sea. this is a dangerous moment in the middle east and we will continue to work to avoid water conflict.

we will take all necessary actions to defend the united states, our interests and our people. and we will respond when we choose, where we choose and how we choose. now, that is what everyone here is focused on. in my first week in the pentagon i did want to address my recent hospital stay and some of the issues around it. i'm recovering well, but as you can see i am still recovering. still having some leg pain, and doing physical therapy to get past it. i'm deeply grateful to my doctors and the nursing staff at walter reed. i very much appreciate all the good wishes. i want to be crystal clear, we did not handle this right and i did not handle this right. i should have told the president about my cancer diagnosis, i should have told my team and the american public

and i take full responsibility. i apologize to my teammates and to the american people. i want to make very clear that there were no gaps in authorities, no risk to the department's command and control. but at every moment, either i or the deputy secretary was in full charge. we've artie put in place some new procedures to make sure any lapses in notification don't happen. in the future if the deputy secretary needs to temporarily assume the duties of my office, she and several white house offices will be immediately notified, including the white house situation room. so will key officials across the department. the reason for that assumption of duties will be included in writing. now, i want you all to know why this happened. i was being treated for prostate cancer.

the news shook me, i know that it shakes so many others, especially in the black community. it was a gut punch and frankly, my first instinct was to keep it private. i don't think it is news that i'm a pretty private guy. i never like burdening others with my problems. it is just not my way i have learned from this experience, taking this kind of job means losing some of the privacy most of us expect. the american people have a right to know if their leaders are facing health challenges that might affect their ability to perform their duties even temporarily. so wider circles should have been notified, especially the president. i will take your questions today but as you know, we've got an ongoing internal review as well as a dod inspector general review that we fully support. so i may have to discuss some aspects of waiver.

let me back up a bit. as you know, on to summer 20 second i had a minimally invasive procedure to cure me of my recently diagnosed prostate cancer and then i hit some bad luck during what is usually a pretty easy recovery. on january 1st, i felt severe leg pain, pain in the abdomen and hip. that evening an ambulance took me to walter reed. doctors found that i had several issues that needed treatment including bladder infection and abdominal problems. on january 2nd i was experiencing fever, chills and shallow breathing. the medical staff decided to transfer me to the critical care unit for several days for closer monitoring and better team care by my doctors. the deputy secretary assumed the functions and duties of my office which happens when

necessary. her senior staff, my senior staff and the joint staff were notified of this via notification procedures. i never directed anyone to keep my january hospitalization from the white house. january 5th i resumed my functions and duties as secretary from the hospital. i was functioning well mentally, but not so well physically and so i stayed at walter reed for additional time for additional treatment including physical therapy for some lingering issues with my leg. i am offering all of this as an explanation, not an excuse. i'm very proud of what we have achieved at the department over the past three years but we fell short on this one. as a rule, i don't talk about

conversations with my boss but i can tell you i have apologized directly to president biden and i have told him i'm deeply sorry for not letting him know immediately that i received a heavy diagnosis. he has responded with the grace and warm heart that anyone who knows president biden would expect and i'm grateful for his full confidence in me. finally, also missed an opportunity to send a message on an important public health issue. i would like to fix that right now. i was diagnosed with a highly treatable form of cancer. a pretty common one. one in 8 american men will get prostate cancer. one in six black men will get it. i'm here with a clear message to other men especially older men, get screened, get your regular checkups, prostate cancer has a glass jar. if your doctor can spot it, they can treat it and beat it. the side effects that i

experienced are highly, highly unusual. you can count on me to set a better example on this issue today and for the rest of my life. again i want to thank everyone for your support. with that i will take your questions. >> associated press, leader. >> thank you, mister secretary. you said you never directed anyone to keep this from the white house. did you direct your staff or others to keep it from the public and from other senior staff members and if you did not, has anyone been disciplined for doing something you did not tell them to do? and quickly iraq and syria what is your response to the statement today's the they are responding or not doing any more attacks? >> good morning. to answer your question on whether i directed my staff to conceal my hospitalization from

anyone else, the answer is no. in terms of my response to the statement, we always listen to what people are saying but we watch what they do. actions are everything. so we will see what happens in the future. >> during that time you were in the intensive care unit, there was an airstrike carried out, a drone strike against an iraqi leader of a militia. how is it that -- do you regret that the authorities were not clear at that point and what can you explain about what was going through your mind at that time and separately, there's been a lot of telegraphing about targeting and responding to the drone strike.

so much so that the uranian proxy leaders have left the country, some are in terror on. has there been too much telegraphing or is the point not to kill the uranian commanders? >> regarding the strike, that strike, i made recommendations to the president on actions we should carry out and the president made a decision, based upon that decision, authorities were pushed down to the central command commander and as you know a strike like that, you can't pick the precise time the strike will take place. you want to minimize collateral damage, make sure you have everything right so the subordinate commander had the

controls on that particular strike. i was involved in planning and recommendations for that. we knew that would take place within a matter of days. in terms of telegraphing about strikes, whether or not people leave or have left. i won't speculate on any of that. i will just tell you we will have a multitiered response and again, we have the ability to respond a number of times depending what the situation is. >> let's go to reuters. >> what did your deputy know about your condition? >> i think in terms of what she knew and didn't know i think we

should probably let that come out of the room for you. i won't speculate on what she knew or did not know based on what information was passed to her. i think the details of that will come out, one or both of those reviews. >> mister secretary, you say you didn't direct your staff to hide this or lie but did you create a culture of secrecy that then staff interpreted as your desires or intentions when it came to you getting sick? >> i don't think i've created a culture of secrecy. i think there will be security officers, other staff members who may perceive that they are doing things in my best interest. i can't -- i can't predict or determine or ascertain what those things might be.

i just know what i said and did not say and of course i have a great staff and they always want, intend to do the right things but in terms of -- stuart: just going to step aside a moment of the press conference, he's dealing with how he responded to attacks on us while he was in the hospital. senator bill cassidy is with us. he has been watching what's going on secretary austen. he has explained he does not -- he didn't create a culture of secrecy but he admits he did not handle his hospitalization right. what do you make of this? >> as a doctor i can understand why man doesn't want everybody to know that he's got prostate issues. as a rule patients are entitled to privacy but i also think he is absolutely right when the secretary of defense of the united states of america, some of that privacy is sacrificed. i will say one more thing i agree with.

all men watching this need to know they need to get their prostate checked annually above a certain age and after -- african-american men in general are at high risk of long-term prostate cancer. one thing that comes out of this, somebody goes together prostate checked to otherwise wouldn't, that's a good thing. we one can the defense secretary maintain the respect and keep the morale of our troops high when he has admitted to not handling this right? >> we all make mistakes. he acknowledged has a mistake. i can't speak for the morale but the morale is more dependent on their immediate predecessors and the secretary of defense but i think he has acknowledged he made a mistake, that's a good thing. and we in one sense, we all, you and i, men our age get prostate issues period. he didn't want to tell anybody. i get that. he should have, he should have had a complete openness, that

is what you have to do when you're secretary of defense. >> you don't want him to resign? >> i don't think -- there should not -- this should not be the basis of a resignation. as long as lives aren't sacrificed. i will give him a mulligan on this as long as he and every other official now in this president's cabinet and future cabinets understands you go to the hospital you let people know. stuart: thanks very much for joining us, very difficult day, always appreciate you being here. fbi director -- are we going back to the defense secretary? we are tracking what he is saying and if we get a headline you will get it first. fbi director christopher rader shook chilling morning the chinese hackers are preparing to wreck havoc on our critical infrastructure. richardson will have details on that after this. ♪

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you can make money the hard way as a bullfighter or a human cannonball... or save money the easy way, with xfinity mobile. existing customers can get a free line of our most popular unlimited plan for a year! not only will you save hundreds but you'll also be joining millions who have connected to america's most reliable 5g network. sure is a lot safer than becoming a stuntman for money. get a free line of unlimited intro for a year when you buy one unlimited line. plus, get the new samsung galaxy s24 on us. stuart: defense secretary austen is holding his first press conferences his hospitalization and said the following.

he said president biden will not tolerate attacks on american troops and our response would come when, where, and how we chose. on the issue of his hospitalization, he admits, i did not handle this right, he has apologized to his team, the american people, and he said he never considered resigning. he's gone on to say his policy is to contain the crisis in gaza and is called on iran to stop supplying houthis with weapons. that's how far he's gotten so far. fbi director warns the chinese hackers are ready to wreak havoc on critical us infrastructure. richardson joins us. what is the white house saying about this? >> the white house says the united states is on top of the cyber threat with china. senior law officials told congress they disrupted a major chinese hacking effort targeting american infrastructure. the administration says they are watching for more hacks like this.

>> this is something we are monitoring very closely and we take all these threats seriously. you have to. each and every day, there's not a day we aren't taking a look at cybersecurity particularly when it comes to kregel infrastructure. >> reporter: christopher wray told the house select committee on the chinese commonest party that the us distributor chinese government hacking group known as golf typhoon. he said it planted malware allowing hackers to hide and cradle american infrastructure like communication, energy, transportation, even water. he also warned of china's decades long campaign to steal american trade secrets, he said this threat is hardly over and a successful cyber attack would represent real world threats to our physical safety. >> china's hackers are positioning on american infrastructure in preparation to wreak havoc and cause real-world harm to american citizens and communities. >> china's goal here is the

ability to disrupt the military's mobilization in the early stages of any conflict. in may, microsoft warned of the same chinese hacking group, announcing it had been active since mid-2021 and targeted critical infrastructure organizations in guam and elsewhere in the us. stuart: not good. thanks very much. former cia director leon panetta is warning about a proposed ev battery plant in michigan. what is he saying about it? ashley: he warns lawmakers a proposed ev battery plant in michigan could be used for chinese espionage. the facility, a chinese company called goshen high tech. he says make no mistake, beijing has ulterior motives. listen to this. >> i don't think there's any question they will take advantage of the situation and we have to be very vigilant about what's going on. that's just the way they

operate. they will establish a manufacturing unit, they will establish whatever they can and then they will use that for their own intelligence purposes, they will use that for their own economic purposes. ashley: he proposed two factors, when michigan and another illinois with a total investment of $4 billion but panetta says the chinese facilities present national security risks and shouldn't be built. stuart: still ahead. missouri senator eric schmidt on biden going to east palestine, ohio, a year after the toxic train derailment. molly hemingway will deal two squad members voting against barring hamas from entering this country. the 11:00 hour of "varney and company" is next. ♪

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to to to stuart: 11:00 eastern time. lloyd austin giving his firs