very difficult because we want to trust when we are told things aren't true, but the other thing to keep in mind is where the president's policy is going to go with somebody who still says the iraq war was a good idea something that the president said at least president said was a bad one. >> that's it. thanks very much. that's it for me. erin burnett outfront starts right now. ouft next breaking news stunning shake-up on the white house. national security adviser mcmaster is out. john bolton, hard liner former u.n. ambassador is in. also breaking this hour, president trump's legal team in chaos out. what the shift in strategy means for the russia investigation. and markets plunging. do you off more than 700 points on fears of a massive trade war. president's trade adviser is my guest. let's go outfront. >> good evening i'm erin burnett

outfront tonight breaking news major shake-up at the white house moments ago. just learning that national security adviser h.r. mcmaster is gone. president just tweeting, quote, i am pleased to announce effective 4-9-18 ambassador john bolton will be my new national security adviser. i'm thankful for service of mcmaster done outstanding job and always remain my friend. the president has privately expressed frustrations with mcmaster calling friends and other advisers to complain. a source saying that their differences stem from very different personalities and styles. bolton meanwhile has had a positive personal relationship with the president according to sources. his views though can at the least be hawkish on issues like north korea and iranian make him a very controversial pick.

jeff zeleny at the white house. let's start with this. we know the president wanted to get rid of mcmaster here you have at the final hours of the day a major shake-up at the white house. >> reporter: no question about it. continues a series we've been seeing over the last several weeks in change of philosophy and change in direction. people who have the president believes will be loyal directly to him. they also share another similarity. people who he has seen on fox news. people who he has watched during his first year in office. of course the chief economic adviser replaced just a couple weeks aguilarry kudlow coming in. cnc contributor. now bolton harder line approach. so what we are seeing, erin, is reshaping of the trump presidency only a year and three months in. this is no surprise at all. we have been reporting for weeks, as you said, the president has been disenchanted with national security adviser. they have not seen eye to eye. but as recently as this afternoon, people in this white

house here were pushing back hard on the very idea that john bolton would be hired. we saw john bolton walk into the doors of the west ring here around 4:00 to have a final sit down with the president. even at that meeting many people did not know. one of the reasons, that whole north korea meeting that still hanging out there. h.r. mcmaster was at the front of arranging that. the diplomatic talks between the u.s. and south korea for the north korea meeting. john bolton has hawkish different views, nondiplomatic views if you will. the being question tonight what this means for james mattis, defense secretary, one of the last men standing, or certainly one them. seen the secretary of state leave, of course. what does this do with his relationship here to the white house? another major, major change here or one that certainly fits a pattern we have been seeing, erin. >> sure does. we'll talk more about john bolton. but to give everyone a sense, a guy whose head line in 2015 was

to stop iran bomb, bomb iran, strike can still succeed. give everyone a sense where he stands. and very different from someone like mattis. we have seen so many people leave from the white house. that has been the story. who then is next? mcmaster was sort of the dead man walking and he's gone now. >> erin, that is always the question around here. but the answer always seem to revolve around the person who sits in the corner office just a few pays from the oval office. that is the white house chief of staff john kelly. he of course has been here to right the ship since last summer. you wonder how long he will be here. when you ask him and those around him, he says he serves at the pleasure of the president, he'll be around as long as he seems to be effective. but erin if this pattern continues, the president putting people around him who are yes men in a sense, someone who not necessarily challenging him, i would certainly put john kelly on ts list of people who certainly may be at some point on the way out.

but again all the timing of this is controlled indeed by the president. so we will have to see, erin. >> all right. thank you very much. jeff zeleny. interestingly steve bannon talking today saying if kelly is fired he doesn't think the president will bother with another chief of staff. he'll run it all himself. outfront know gloria borger hour chief political and list, and julia former assistant secretary for the homeland security. juliet, yes, we knew mcmaster was a dead man walking. this was a major shake-up. national security adviser and this is a huge change. >> it is a huge change. not just for the white house, but obviously for all the agencies in the national and homeland security space who look to mcmaster's office as a semblance of sanity in the insanity. and so this comes the same week that the secretary of state rex tillerson has left. so you have unease there. you have a shift from the cia head over to the state

departments, you've got lots of moving pieces. with agencies that don't like chaos, for obvious reasons. they like order because their job is to maintain order. so my quick takeaways from this is if a president wants chaos, he will get chaos. that's what this president wants. there is no more adults in the room a no one going to control the process. this is what the president wants. and we will see. then to the new national security adviser, this is someone whose checks has no internal checks. this is a man who sees war and military effort as the only solution to a very complicated world. so if i sound a little bit more exercised or energy itic than i normally do, because for john bolton, he is the hammer and everything is a nail. and all we can hope is mattis controls that. >> and obviously mattis fate

obviously now is in question, he is the one who got along with rex tillerson ideologically on a lot of things. a lot of countries around the world didn't like them. h.r. mcmaster went along with more conservative like iran. you heard jeff zeleny talking about john kelly. >> so what happens here? >> what you've seen, and i think you have to basically go from gary cohen resigning to today. >> it's in the past two weeks we have seen these things. >> yeah, it feels like 200 years. go from cohen today, you've severe overhauling of domestic policy, rex tillerson out, mike pompeo in. you've seen overhauling of diplomacy broadly red.

now you are seeing an overhaul of national security. because candidly as juliet rightly noetsd and almost under states. the difference between mcmaster and john bolton, i think people will learn more about him is vast. donald trump is, as we are watching, remaking huge swaths of the people he listens to. but do not under estimate what's happened, i don't know when gary cohn resigned until today, you are seeing 14 months into the administration, this is not second term, start of the second year. normal presidency start at the term, holy cow this is big pivot by this presidency 14 months. >> whatever word you are going to use, gloria borger, ousted. >> all of the above.

>> the president shows his frustration. events it behind people's backs back to advisers and friends and vent it on twitter. then eventually he usually fires you. jeff sessions seems to be the one guy immune to that so far. but mcmaster he went after him in february when he was talking about mcmaster when mcmaster came out and blamed russia for interfering in the election. the president went to twitter and he said with the fbi indictment the evidence is now incontrovertible. i'm sorry. that's what mcmaster said. incontrovertible russia interfered with the election. trump didn't like to hear that and that's when he tweeted. general mcmaster forgot to say they were not impacted by the russians. then he tinted to talk about crooked hillary and her collusion. was that it? was that the moment when trump decided mcmaster, you are out? >> look, we wrote a story as did some other publications last thursday night, late, i remember working on this, saying that the

president had decided, according to our sources to fire mcmaster. then the next day you'll recall sarah sanders came out or that night and said he's not going anywhere. so it was kind of sticking it to the media. i think while the white house denies this, probably had something to do with the leak the other day about the president's phone call with putin. >> do not congratulate. >> right. because that came after -- those were the notes. but the president and mcmaster have had had a troubled relationship for a while. the president doesn't like the way they brief him. they never clicked personally. but taking a step back here to follow on what chris is saying, and i talked to a friend of the president and wrote about this a couple weeks ago, because the president is now a man in full. he believes that he is in charge and he's done with people telling him how to run the white

house. that he wants to put people in the white house that he knows and he likes and that's part of the reason this looks like a fox news green room, right. i mean, you see the new appointments, and a lot of them are from fox news. these are people the president knows and feels comfortable with, agrees with, and he doesn't want people who are going to say no, no, no to him anymore. he has decided he's mastered the job. he's going to do what he promised, look at what he did today on trade with china. he's going to keep his promises. and he wants people who are not going to quit if they disagree with him. like gary cohn. so he wants people who will sa salute. and wants people with the program, his program. and that is what we. >> we are getting. >> and we will continue to see that. i mean, this is donald trump taking over his own administration. >> can i just? gloria makes this point and i want to reiterate it. you cannot compare this to any

modern presidency, not only in the raw number of staff turnover, not talking about the junior deputy assistant secretary of state for whatever, we are talking about massively important roles that shape policy in this country and around the world. by the way, no one, that i certainly talk to, thinks that we are now done. donald trump is done with his remodel, right? the questions about john kelly and mattis. these will continue over and over again. >> hold on. i want to read mcmaster came out with an email. so i want to share it here, juliet. he has eemd the national security council, his team, thanking the president for the opportunity to serve, and says he's going to address everyone at 9:00 tomorrow morning in a town hall, quote, to ensure a smooth transition between me and ambassador john bolton.

letsds be honest, juliet, how difficult is a smooth transition? mcmaster and bolton do not believe the same things about the world. >> no. no, but this is, i mean mcmaster is doing the right thing. whatever he is feeling inside, however frustrating this is, we don't know what exact moment lead to this, doing the right thing from miss military background which is transition. i want to talk about policy for a second and why this is all significant. as i've been saying on your show, the people who trump fires are the people who disagree with him on russia. and mcmaster was one of them. rex tillerson was the other. mcmaster -- so i don't believe that this is a coincidence. he wants people around him who take his line on relationships with russia as well as, of course, the investigation, which is a different issue. the second thing which i just want to add is there is a reason why we should all believe that he is going to fire mueller despite the representations

otherwise. because for the last couple weeks, we have been told mcmaster is safe. that it was very calming to our allies and maybe somewhat threatening to our enemies. they felt like there was an adult in the room. that all shifts. and i just say any words from this white house at this stage about someone's status whether they'll be hired or fired is just baloney. >> meaningless. they came out with rex tillerson, it's fake news, and then he just waited. can i just ask you, chris, kaitlan collins is reporting that from a source in the white house, that the president wanted to know whether an mcmaster person was behind that leak, the leak of we told you do not congratulate. >> right. >> and i 'utah that reporting from caitlyn with the note that mcmaster says he's resigning here officially from the military this summer. all this talk about they were going to find a smooth landing and four star position for

mcmaster to show if you leave this white house, it's not the end of the world. >> it can be on amicable terms. >> maybe he didn't want that. but that's not happening. no four star position. he's done. resigning from public service. that's what he said. >> one of the most appalling things i saw, this was amid all the coverage last night of mcmaster leaving, rumored to be leaving, there was a line i think it was my own "washington post" story, it said essentially trump is ready to get rid of mcmaster but fine with taking the time to make sure there is it a smooth landing. he doesn't want to publicly humiliate him. so spreading that around is like a guarantee we are publicly humiliating him. he's done with him. but he's going to toy and we'll see what happens. that is stunning stuff. and again you shouldn't do this to anyone who w for you at anything, whether the presidency or anything else. but to do it to someone who is a

highly decorated, highly respected military man who, by the way, is your secretary national security adviser, because the first one you had to fire and plead guilty to lying to the fbi and cooperating with the mueller probe, again i use that word appalling. >> gloria. >> say one thing, trump also today made it official or john dowd made it official trump is running his own legal strategy. that dowd quit because the president wasn't taking his advice. he didn't like the fact that joe digenova was appointed to the team. he felt he was conflicted. and so the president's legal team now in terms of russia is looking for lawyers. there is a help wanted sign out all over washington. so you have the president saying i'm going to lead my own legal team and legal strategy. i'm going to run my foreign policy. and, by the way, i'm going to run my white house the way i want to do it. this is what he did at the trump

organization. and this is what he's doing now. >> well, yes, and of course the problem is one person can't run all of those things well. it doesn't matter whether you are super human or not. by the way, comes on the day rex tillerson said good-bye to the state department talking about the mean spirited town, you'll hear about that, you'll hear trump adviser caused the market to tank 700 points, and more on the news on mcmaster out, bolton in. who is bolton to writes the op he had bomb iran. time is short but strike can still suck he'd. can that succeed? more trump mueller probe also out. why is dowd gone tonight. and the breaking news on the markets. we'll be right back. and serve with confidence that it's safe. this is a diamond you can follow from mine to finger, and trust it never fell into the wrong hands.

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worsened breathing, chest pain, mouth or tongue swelling, problems urinating, vision changes, or eye pain while taking anoro. ask your doctor about anoro. ♪go your own way get your first prescription free at anoro.com. breaking news, former u.n. ambassador john bolton fox news contributor is replacing mcmaster making this a little while ago. we've known for several weeks mcmaster was on the outs. bolton was on the list of possible replacements. but billion ton is not just anyone. he's a very specific and controversial pick and very significant one for this country tonight. barbara star at the pentagon. bolton has been outspoken on issue. one of the most recent north korea advocated for military intervention instead of diplomacy.

that's one of many. but what about north korea? >> reporter: well, that is now front and center as we could be a couple of weeks away from president trump summit with the northern leader. look, the problem now is this puts defense secretary jim mattis in a very difficult position, unchartered territory for him in the year plus that he has been in office. mattis, a major advocate for diplomacy backed up by the threat of military force, but bowel ton, as you say, erin, has been out there time and again very much talking about the use of u.s. military force, whether it's north korea, iran, or other scenarios. this is not what mattis wants to see. he has crafted a strategy where he goes to the president and he talks about options. and he makes it clear to the president that military force is the most significant step. has mastisive costs not just to this country but to the pacific region, to financial centers

around the world. this is very difficult business. and he's been able to convince the president for the last year, keep up the diplomatic it pressure campaign, keep it going. but rex tillerson is gone now. that voice is gone. h.r. mcmaster's voice is gone. this now puts mattis in the toughest of positions in terms of getting his views directly expressed to the president, getting the president to pay attention. already tonight top administration officials saying it will all be fine. mattis will be heard. but we actually don't know that for a fact. and that is causing some consternation now. will bolton's voice now take precedent over the diplomatic voices that have been talking to the president, tillerson and mattis for the last year? >> certainly given many countries and individuals around the world a lot of calm about this administration certainly not a name they want to see floated as in jeopardy in any way. thank you very much, barbara star. i want to go to former state

department spokesperson and pentagon press secretary kirby, sam joins me national security team for the obama administration. thanks to both of you. all right. i want to get the sense here of how crucial of a moment this is, admiral kirby. mcmaster is out. and john bolton is in. what is your reaction to that? to john bolton now being the national security adviser, single most important voice on national security, war and peace decisions to the president of the united states? >> i'm worried about two things here, erin. one is obviously very hawkish record like north korea and iran deal. now we have pompeo potentially coming in secretary of state. more bell a coast attitude of the united states towards the iran deal worries me greatly and militaristic tone. and number two, i'm worried that the president is more and more surrounding himself with yes men. with people who are either promising to think like he does or will think like he does on everything. and one of the great things

about a good national security adviser is teeing up as, barbara said, lots of options. different opinions. even dissenting views. and i worry that mr. bolton is not the kind of guy with the strong record of being inclusive thinker in that regard. >> sam, i mention and i want to mention again, an article that was written by john bolton, an op-ed to stop iran's, bomb iran was the head line, and continued in a sentence to say, time is terribly short. but a strike can still succeed. advocating a military strike against iran. that was in march of 2015. so that we should bomb iran. and here is what he said on north korea on fox news just recently. here he is. >> the only diplomatic option left is to end the regime in north korea by effectively having the south take it over, i think you have to argue. >> not really diplomatic as far as they are concerned. >> that's our problem, not ours.

>> that was september of last year. >> stamp, are those things that he says and now maybe he'll be different. we don't need to have south korea go to war with north korea and millions of people die. or does he mean that t i'm going to tell the president to do that. >> i don't think there is any ambiguity here, john bolton regime change as preferred national security tool. i think he also added on north korea, that donald trump and kim should meet but only so that donald trump could deliver a credible military threat. so diplomacy is only happening as pretext to potential war. so i think the real question is, one, is donald trump actually going to listen to this national security adviser. and if he does, is john bolton going to put aside his personal views and have an inclusive policy process. because as national security adviser, your job is to go out to all members of the agency, take all different views, from the state department, united nations, from the defense department, and present all

options to the president. so if john bolton wants to be a blocker on ts diplomatic track and only wants to put forward military options, frankly he has the power to do that he controls what meetings happen in the situation room, what paper makes its way to the president. so between a rock in hard place. we'll either have another unimpowered national security adviser or guy who comes in who doesn't believe in using all the tools in the toolkit. >> admiral, we have this news in, that john bolton, we are learning, did not expect this announcement to come this afternoon. my question to you is, what does it say to you that he seems to be surprised when you pair that with just the point, and again we don't know, whether mcmaster said i have no interest in four star position or here's what we know, he's not getting one, he's resigning. >> i'm not surprised mr. bolton is surprised by the announce. seems to be par for the course with the white house, puts things out there without any

thought. so that doesn't surprise me. on mcmaster i think we need to be careful here. a four star was certainly i think talked about. but there is not a lot of four star jobs out there. they don't have that many four stars, period. and the rotations are very, very awkward. so i don't know if we need to read too much into the fact that he's not getting a four star. i this i retirement was always an option for him. he was playing to retire anyway as three star. so i don't think we should read too much into that. >> sam, also learning that the john bolton said the leak was unacceptable and that was the leak came from mcmaster or someone who works for him bullet points to tells him what to do on the putin call which the president didn't bother to read or ignore and bolton is calling that person an m1 kin. look, that's the way, this is the word that he used, but what does this mean? munch kin. >> the word munch kin makes me

laugh a little bit. but i strongly agree with bolton. gives the other side the advantage f the president doesn't think he can trust the five or six people see the final briefing package, then i think he'll rely on him even less. and we know the president likes to shoot from his hip on the calls. so if he thinks the people in the room, the chief of staff, senior director for russia, if he thinks they can't be trusted to keep information close hold as we used to call it in government, i imagine he's going to do more on his own, which doesn't make me sleep any better at night. >> admiral, bch we go, another thing that was said in december of 2016 by john bolton, he questioned whether the russians were behind the hacking of the dnc. he said why would russia leave fingerprints. that's what he said. now, that fits with the president's constant questioning of russia's interference, broadly in the election. does not fit with mcmaster, right, who said the evidence was

incontrovertible and the president slammed had him on twitter. >> or new secretary of state mike pompeo who 45s been pretty clear about russia's role here. yeah, i'm worried about that too. i think the president is a bit of a purge here and trying to surround himself with people who think like him as much as possible on ts main issues. and to sam's point i worry you are not only getting a national security adviser who may not be heard by the presidet, but who the president may not listen to, period, or may not be empowered and encouraged to provide his own individual thoughts. trump is surrounding himself now with people who are more and more in his line of thinking, and that's not healthy, particularly on this russia issue when we have a 2018 midterm coming up and very clear from the congressional testimony of just the last couple of weeks that we aren't doing enough to get ready for it. >> and under attack as the president's own intelligence chiefs made clear. thank you both very much. next trump's top attorney on the russia probe calling it quits. john dowd. why is he leaving?

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lawyer in the russian investigation, john dowd quitting today. dowd former marine core captain, main contact with mueller in the russia investigation. he had pressed the president to lay off attacking mueller personally of course it worked for a while but as we saw this week the president completely disregarding that. personally attacking mueller by name for the first time tweet the mueller probe should never have been started there was no collusion and no crime. and why does the mueller team have 13 hardened democrats, some big crooked hillary supporters and zero republicans, that along with retweeting criticism saying there should be no special counsel coming from a professor. ryan nobles outfront right now at the white house. you talk about the legal team perhaps the most important thing for this president right now in the future of his presidency, the guy in charge, gone, what can you tell us? >> reporter: yeah, that's right, erin. this story shouldn't get lost in all this news about mcmaster at

all. jhn dowd was the lead attorney for the president as he was dealing with this investigation by the special counsel. and what we are being told is that this is the best indication that the president himself believes that he is the one who should dictate his legal strategy. and from what we are being told, john dowd had really recommended to the president that he play nice with the special counsel. he's personal friends with robert mueller. he suggested cooperating with the special counsel on every front. and it seems just at least from his public posture, that the president didn't seem to agree with that you point out the tweets where he is now starting to call out robert mueller by name. continuing to call the investigation a witch hunt. that doesn't show a sign of helping. so, erin, this is definitely a

shift in president's trump's legal strategy and it could impact how this investigation plays out. >> all right. ryan nobles, thank you. let's go to dana bash, our chief political correspondent with me and michael zel dom. what do you think of this? far more aggressive policies on bob mueller. dowd said play nice. give him everything you want. if you have nothing to hide, put it out on the table. what does dowd resigning, quitting, whatever the appropriate word may be, tell you about what's happening in trump's legal team tonight? >> well, it appears that it may be a shift from a more cooperative to a more aggressive standpoint. but i think really all eye vs. to be on ty cobb special counsel in the white house who is still in charge of this investigation from within and is still counseling cooperation. so if ty cobb stays on and the

president listen to ty cobb, then i this i we still have an opportunity perhaps for mueller and the president to reach a compromise on testimony and continued cooperation so that we can get to an end to this. if ty cobb goes or if they bring in a new outside counsel, in addition to joe digenova who is really going to ratch et up the fight with mueller, then we are in for a long drawn out fight at least another year to resolve. >> dana, you talked to the president who knows this very well, this is now war with bob mueller. this is what that means? >> yes, first of all i agree with michael, this is compromise or being aggressive. but it's also about the fact that i've been told by several sources that the president was very frustrated that his legal team was telling him through the end of 2017 that this mueller investigation would be over soon. because they were trying to manage their client. the president.

and it blew up in their face because it wasn't over soon. and the president is not happy about that. because the expectations were said in a different way. and perhaps as part of that the president has decided that he is going to be much more aggressive. no matter what his legal team says. and steve bannon did an event with the financial times late today and he said explicitly, i think president trump is going to war. he said i think it's obvious that he's going to go to war on this, meaning go to war with robert mueller, which is pretty stunning thing to say. michael, what do you make of the fact the other reporting we have today, that the president's legal team, president has approached four lawyers, top lawyers, including ted olson, and others rk, to ask them to j the team and they are refusing. and the reasons are they either don't want to work with them or conflict of interest. but either way they are having trouble getting some of the top people they want to get. what does that say to you?

>> so if john dowd politically aligned with the president is resigning in certain measure because the client won't listen to him, who in their right mind tas a lawyer would want to step into that situation? if dana is right, and she always is, that he's going to take his own counsel, he's going to be, if you will, his own lawyer, then what outside counsel will want that engagement? it's just a no win proposition. and so what we have to look to, if there is a war as bannon predicts, who are the casualties? will sessions and rosenstein be the casualties of that? will the cooperation that leads to testifying before mueller be the fall out of this? there are things that we have to look at that will portend what the future is. >> you mention steve bannon going to war with mueller, you

had a chance to speak to bannon about a couple of things at this ff event you mentioned, including reports that he was the one who was sort of presiding over, was in charge of the program at cambridge analytica. >> it's what cambridge analytica whistleblower said he was in charge. >> he was in charge of kaim r- cambridge analytica getting all this data from facebook. you asked him about t i want to play your exchange. >> hi steve. >> hi. cnn my favorite. >> i know. i heard. can i ask you about a facebook and cambridge analytica? >> can we stop? >> cambridge analytica. >> you heard by talk. >> i did. but we didn't get to the bottom of it. did you know that cambridge analytica was using personal information for facebook? >> facebook data by the way is for sell all over the world. >> i know. but doesn't make it right. did you buy it? >> i don't remember buying it. >> you were the cambridge guy.

>> you were the cambridge guy. then he had nothing to say. >> it was a nonanswer. he said he doesn't remember buying it. people who may not know the details, this has obviously has been a huge breach, 50 million facebook users had personal data through an intermediary, a professor given and bought by cambridge analytica. and a whistleblower said explicitly steve bannon was on conference calls about t knew about it, and they spent almost $1 million on this idea of buying this personal information. so that was the question. and didn't really get a full answer except that he keeps saying that it's all out there. it's all out there all over the world, basically all of our personal information. >> so he's trying to say, it's okay, its all out there.

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welcome back to outfront. as we are following the breaking news this hour, general mcmaster is out as national security adviser. president trump says the former u.n. ambassador john bolton is in. hr mcmaster retiring and not moving to four star job. more breaking news dow dropping 700 points. fifth time plunging.

sparking for fears of massive trade war. that's what sent stocks spiraling. outfront now director of trade and manufacturing policy, peter navarro. peter thanks for your time tonight. as i said the news moving so fast and furiously, you know, go from 724 points being the lead of the show, to make changes at the white house. so let me just get you on the record to understand what's happening there. your reaction to the late breaking news on john bolton coming in, and h.r. mcmaster out as national security adviser. john bolton apparently saying he didn't expect this news to be announced today. do you have any sense as to why it was so sudden? was this because of the leak about the putin call or what? >> here's what i know. h.r. mcmaster is a gentleman, a war hero, and a great individual, who i've gotten to know really well over the past 14 months working on foreign military sales. he's got a great staff.

he's a great individual. i know he will be missed. i'm not sure why today was the day to announce this, but he's a great man, and he will be missed. and john bolton, i've gotten to know him over the years, and he'll be a great replacement. so what we are seeing here is a president who has great judge of talent. and we are going to keep moving forward with the president's agenda like we did today with this historic, historic decision to finally address china's intellectual property theft hand force technology transfer. >> i have to ask you a lot about that. first, let me ask you, peter, because you've been there since the beginning with this administration. >> sure. >> you've been there and loyal and pushing these policies. but i have to ask you, what is it like to work in this place turnover and people are not competent how long they'll be in their jobs? how is it like to come to work there every day?

>> it's a wonderful on horhonor come here and work for people of this country. what i like in this environment to is a football team like the win their division every year y- with different set of players, and only things that's common really is the coach and quarterback. and here in the white house the coach and quarterback are president donald trump and he's a great man. and, listen, erin, whatever you say, you can say the first year of this administration, from an economic point of view strongest in the history of the presidency. this was extraordinarily year. and i had wished that people would pay more attention to the success of this administration. and it's only going to get better. we have put in place tax cuts. putting in place strong trade policies.

we are deregulating. we are now an energy exporter which you and i know ten years ago would have in every been dreamed about. >> that's true. >> so great place to work out and very dynamic, vital place, and it's an honor to be here. >> peter, one thing that shocked me today, you can talk about percentage drops and point value drops. but when four of them happened during the financial crisis, and four of them happened this month, and we're in march. icluding the tariffs that he has announced today that you have strongly fought for. he says they are completely just. here he is today. >> anyway you look at it, it is the largest deficit of any country in the history of our world. it's out of control. >> so, the market fell 724 points on those tariffs. china's threatening to

retaliate. its embassy in the u.s. saying china is not afraid of and will not recoil from a trade war. are you willing to take a trade war on? >> so let's go back in time, erin when you and i used to work at another network and we did financial market analysis. and let's look at what happened. yesterday around the noontime, i was looking at the crawler. dow was up 200 points, and we were seeing a notice on the crawler that the president was going to introduce tariffs on china. no big deal, what happened, the chairman came on and announced three hikes before the end of the year. and the tech stocks were rattled. so the tafriffs were --

>> you and i both know the tariffs are the big reason. it could go up tomorrow, but let's just be real. >> let's be real. i think the scenario now is very, very bullish. erin, let me just make a case here. >> okay. >> you know basically stocks run on expectation of a future stream of corporate earnings. by basically cracking down on china's i.p. theft and forced technology transfer, the outlook of corporations that have been stolen from by china, it's brighter than yesterday. this is going to be great buying opportunity. you' you've seen dips before. you have tax cuts which are going to start to kick in, in force with additional investment and spending in '18 and '19. the tremendous job by mick mull

vain ey vainy, amazing on deregulation. we have a situation where we are exporting energy, very low-cost fossil fuel energy which is going to help our manufacturing base, and we are cracking down with tariffs on things like solar and washing machines, aluminum, steel, and what's happening? prices aren't going up. we are having investment flood into this country foreign countries build washing machines here with local hands. let's not get too excited about today. >> one day is one day. you mentioned aluminum and steel. you've been a purist for as long as i have noknown you. you believed in the steel and aluminum tariffs. you've been consistent. when you say tariff, you mean a tariff on everybody, and you said that very directly on cnn

this month. here you are. >> as soon as you start exempting tariffs, you have to raise the tariffs on everybody else. as soon as you exempt one country, then you have to exempt another country, so it's a slippery slope. >> it's such a slippery slope that we're going down a black diamond. today, robert lighthizer, said brazil was exempt, canada's exempt. mexico is exempt, more countries are coming. how do you be happy with that? >> i'm ecstatic about this. >> about the exemptions? >> yes, they're temporary exemptions, conditioned on the ability of these countries to come to the table and give us more fair, reciprocal trade. i can assure you, if we don't get a better deal in the context of nafta from canada and mexico and refigure this, we're going to have something happen. i should tell you, this is an

important thing. every country that is not facing tariffs that we're going to negotiate with will face quotas, so we protect our aluminum and steel industries. i would put this out as a rhetorical question. >> canada is going to be punished in some way. >> it's not a question of punishment. >> there's no tariff, but they're not going to be able to export as much as they want, there's a quota, to be clear. >> four ar all countries there to be a quota, then any country that can do what they want will be a transshipment place. lighthizer is the smartest dguy who's ever sat on as trade adviser. the question boils down to whether you want to have a steel and aluminum industry. the president says we can't have a country without them. i happen to agree very strongly

with that. and if we're going to defend those industries from what's been a surge of imports, the only choice we have is a tariff regime. >> thank you, i'll talk to you again. we are following the breaking news on hchblgs .r. mc. he is out and john bolton is in. even peter navarro has appeared so many times, trump looks to people on television for important positions in the white house. look what bolton said moments ago in an interview on foxnes n. >> i've never been shy about what my views are, frankly, what i've said in private is behind me, at least effective april 9th. and the important thing is what the president says and what

advice i give him. >> brian stelter's out front. he's said things about bombing and south korea invading north korea, we're supposed to forget that? >> he's very hawkish. so many people have been concerned about this news, and i don't think it's possible to say okay everything i said today doesn't count. a big part of why he was hired was because he was on fox talking this way. as you said, the latest example of this pipeline. heather nowart, mercedes schlapp. larry kudlow, now you have fox regular joe digenova joining the legal team. he wasn't paid by fox. he was on the network all the time. it is remarkable, the number of hires we're seeing from tv. >> it's a pattern. people who are veterans, used to being on tv. the president watches cable and particularly fox news. if he watches you and likes you

it looks like the white house edition of "the apprentice", and i don't say that lightly. >> he's treating people's tv appearances as audition tapes. i saw a comic last week say he wanted to have trump tv, he's creating it in the white house. he wants the debate on cable news to happen in the white house and to be on tv defending him. i think it was interesting, bolton said i wasn't expecting the this announcement today. i'm not a big fan of the argument of trump always trying to, i have to wonder if he's making a big announcement to take away from an unflattering story. >> a woman who's going to say that she had intercourse with him dozens and dozens of times, was paid off not to talk about

it before the election. everyone should be paying attention to that. but, you know, there's also this habit of denying things. in the fall, rex tillerson is out. and the president says it's fake news, and he waits in part to show that the news is fake, but it's truch it's true. maggie haberman says they're going to add a lawyer to the legal team. and guess what, he adds joe digenova. and here we are. >> sarah sanders said, just a week ago, that mcmaster was not leaving the white house. the president himself was on twitter talking about these topics. so it is the latest example, that we can't take the white house spokes people at their word, because sometimes they don't know what's going to happen. they don't know what's going on. this is the latest example of that. i do wonder if more cable news celebrities will be joining the white house and what that means, whether those kind of

credentials actually are valuable in leadership roles. this is a test the president is doing, this is straight out of his playbook. tv producer in chief. >> thank you very much to brian stelter, and thank you for joining us. our breaking news coverage continues with the interview with karen mcdougal. breaking news involving the adviser who will be at the president's elbow if it ever comes down to pushing the button. a three-star general is leaving, his replacement, a former ambassador, a tv pundit who's been called by some a loose cannon. and my interview with karen mcdougal, a relationship that began a few months after melania trump gave birth. if launmelania is watching this what would you want her to