back here tomorrow. lou>> good evening, everybody, m lori rothman in for "lou dobbs tonight." safe haven russia, president vladimir putin refusing to hand espionage as long as he stopsith the security leaks from the team to dribble out, snowden also breaking his silence tonight for the first time since he fled to moscow claiming here to max remains clear to serve the best interests. accusing the united states of economic espionage against our european union allies. aal the latest coming up here in just moments. also, egyptian army offering

president mohammed morsi the ultimate ultimatum. has hundreds of thousands continue to protest the former muslim brotherhood member in tahrir square. president obama from africa declining to call for morsi's resignation. the position has always been it is not our job to determine who the leader are. thiwhich was time to transitiono no space on the fact egypt had not had democratic government for decades. more shocking testimonies in the george zimmerman murder trial with another witness backfiring for the prosecution. the lead investigator sharing revealing conversation with zimmerman moments after the death of trayvon martin. that could sway the jury in the defendants direction. the latest developments in the documents stolen by edward snowden.

releasing details of u.s. spying on european allies by bugging dozens of embassies. as remains illega in legal limb. >> applying for asylum with his handler. while the claim cannot be independently verified, earlier in the day russian president said he could stay in russia only if he stopped leaking classified documents about u.s. surveillance programs. even the former kgb officer saw the irony. >> if he wishes to stay here, we have one condition, he must stop his work aimed at harming the american partners. >> they claim the former nsa contractor is not helping moscow.

>> he never was and today is not, or special services have never worked with him and don't work with him. >> even moving in the right direction. speaker has been high-level discussions with the russians about trying to find a solution to the problem. >> publishing documents, the guardian newspaper says nsa has targeted 38 embassies including those of the european union in washington and new york. century of state john kerry down the ramifications i that he was working with chief representatives. >> they raised it with me today, and we agreed to stay in touch. finding out what the organization is and we get back to her. >> german prosecutors are investigating if laws were broken when they signed on systems using the nsa program that collects overseas internet data and on both sides of the atlantic.

>> we must say very clearly eavesdropping on friends is unacceptable. we are not in cold war anymore. the at the state department defined intelligence community data collection on his allies as routine. >> as we had a kind of intelligence we gather, something other nations do as well. >> snowden sent a letter to ecuadorian president claiming he is being persecuted by the u.s. government for the leaks and thanks him for considering his asylum extradition and the temporary paperwork allowed him to travel from hong kong to russia. he is free to treeview more secrets and he intends to do so tonight the justice department said thei there waiting to authenticate that letter before the comment any further. >> thank you.

fox news digital politics editor and stephen hayes senior writer for the weekly standard and fox news contributor. chris, this one thing to spy on terrace, but now we are gathering economic value from our allies. how damaging is this? >> the only surprise probably is that it came out in this way and even that couldn't be too shocking because once mr. snowden had flown the coop, i am sure everybody knew it would get out. united states spies as allies and intercepts everything. they helped us by checking, we are not the nsa allowed to look at what we do lesser talking to a foreign national but guess what, germany and britain can look at what united states do do and keep their mandates not look

at anything but foreign nationals. lori: does a couple weeks ago the president announced plans to expand a trading agreement with the eu nations and now this comes to light. notice information comes to light among the public and how can the president expects to expand these trading relationships now? >> i think it will be much more difficult. to a certain extent this is what countries do. it is the case, we should note the state department spokesperson was very careful saying this is the kind of information that countries collect on other countries all the time. he didn't say this is the information, this is the means for doing so which is an important distinction making a president further trade talks and everything else far more difficult and it suggests when you hear the defenders of edward snowden said it hasn't been any damage done, i would dispute

that based on what i have been told from intelligence folks talk about how al qaeda's is changing the way they operate. making it much more difficult on a daily basis now dealing with our allies. lori: lets talk about the president and the administration and how they are handling the snowden situation. snowden is hanging out in russia, just put out comments this evening thanking ecuador for considering asylum when we know reports over the weekend, the conversation with ecuadorian officials essentially thanking ecuador for considering asylum but the u.s. now putting pressure on these nations, economic pressures basically warning if we do grant asylum. what do you think about how theu menstruation is handling the situation? >> it wasn't too long ago we

heard the president say i will not scramble jets to get a 29-year-old hacker, i will not call vladimir putin. i'm not going to deal with that. well now we have a president still in africa striking a very different tone which is to say we are trying, we are trying. it is pretty clear the administration is ready to quit laughing about this nonchalant. lori: it is almost the president is downplaying it if you menstruation stepping up. is there some disconnect going on between the president and closest advisors on this? >> yes, and there has been from the beginning. another initial stage where he had the white house and allies and nsa director and others saying this information is now

could cost lives, could cost american lives suggesting it was incredibly significant that this was leaked and made public and edward snowden need not do this anymore. and then indifference and they are back almost to their first position. taken together some totals suggest the administration does not do how to respond, they don't know what to do. putting pressure on our allies, our enemies, on some people in between to produce mr. snowden, to produce the kind of information to tell us what they know about it and to suggest we will punish those not helping us. a lush redone behind closed doors but some have to be done in public if we are not getting responses we want. lori: got to ask you about the statement, yes to stop his work aimed at harming the partners.

it was spoken russian. i think something was lost in translation, h do not take whate said at face value. >> welcome president obama to our club, to the club of the regime. welcome aboard and we stand with you, my friend, to try to take the people in your country from getting all the information, i am trying to help you out. he is growing him, i think is the term, said welcome to the club. lori: thank you for the conversation, you guys are fantastic. >> you bet. lori: the bowls charts of markets to get the third quarter off to a hot start. chief economist anthony chan tells us of good economic news finally means good news on wall street. next. withhe spark miles card from capital one,

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lori: stocks pulling back from session highs, still kicking off the third quarter in the green. the s&p up 9, the nasdaq climbed 31 points. volume 3.1 billion shares. manufacturing activity edging higher last month, following the lowest level since september 2009. construction spending up half a percent in may to the highest level in nearly four years. citigroup and hearing to pay $1 billion to settle claims they sold faulty mortgages to fannie mae. gold gaining $32 per ounce closing just below 1256. crude oil settling at $98 per barrel. in the bond market the yield on the ten-year risings likely slightly 2.49%.

my next guest says the economic data provides reassurance the economy is growing 1.6%, 1.7% rate in the second quarter. join me now, anthony chan, chief economist for chase private client. happy q3 to you. first day of the new quarter. manufacturing date better-than-expected hitting expansion mode, but it is almost as if the excitement and the relief, good news toward the end of the trading day looking at the dow up 173 closing just a gain of 60 points. so much question about good news on the economy bad news because it means the fed will take his foot off the gas in terms of the stimulus, so make sense of it all for me. >> there is a little bit of everything but at the end of the day good news is good news. we want corporate profits to be a little stronger to justify an expansion of price-earnings multiple.

>> maybe the good news isn't necessarily bad enough, do you know what i'm saying? these are crazy times. >> i think you're spot on. report was pretty good in that direction because he had employment on the weaker side and of course that is one of the variables the federal reserve looks at whether or not to raise the numbers. 7% unemployment, six and .5%, those are different thresholds for tapering, the end of quantitative easing and short-term interest rates but the truth of the matter is the labor market is down. if you look at the labor market with quantitative easing, what have you seen? 1.6 million jobs created, or the 900,000 with the unemployment rate so there's no question things are getting better, the question is how fast. lori: the manufacturing data

component of that survey, which was a weak spot. do you think this portends fewer than the payrolls added for june the economy was forecasting? >> it is a little premature to say that. looking at the employment and the sea. what you see in the latest month is the jobs plentiful index made a little bit of progress, so adjusting to me the employment numbers don't have to be that week and in fact complemen cap e could go down from 7.6 to 7.5%. lori: but will it go down for the right reasons? >> last month what you saw was the participation rate picking up by one-tenth of 1% and the extent people now feel jobs are more plentiful relative to what we saw in the prior month, more people are little bit more

anxious to rejoin the labor force. lori: we have lowered expectations in terms of employment situation, talking 155,000 new payrolls added supporting growth of gdp. >> that is nothing to get excited about, but everything is relative. what we have is the largest of possibly any calendar quarter of this year. 1.7, 1.8%. that is not bad with their contracting two on real gdp. lori: was a bernanke .2 the fiscal drag so if you can't fix that, but you have taken to the thracian sequester cuts, companies deciding whether or not being pushed into the affordable care act, if you could in a perrect world remove the mitigating factors, how much more economic strength would

there be? would we be able to reach the economic philosophy that they talk about in a closer period of time? >> we get closer to a philosophy, but with the high levels of national debt it is okay if the government to take back some of the punch bowl and worry about the deficit. the congressional budget office has been getting smaller. what you don't want to do is take so much a way that you push the economy into a 1% growth mode because that is too close to the edge and we have to start worrying about if the economy does a thelma and louise. lori: appreciate your insight. now to the weekend box office where "maastricht university" to the top spot for the second weekend in a row. 20th century fox "the heat" finished in second place.

a huge disappointment for sony with "white house down." debuting in fourth place with $25.7 million. up next the american revolution pave the way for the constitution, but the civil war pave the way for the true equal rights. the world bloodiest battle which began 150 years ago today. [ male announcer ] eligible for medicare?

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lori: 150 years ago today the first shot was fired at what would become the turning point of the american civil war, the battle of gettysburg. the bloodshed ended with more than 50,000 people dead. the civil war waged on for two more years but experts agreed the confederacy never recovered after the battle of gettysburg. joining us, general u.s. army brigadier general and former commander of the first infantry division, a combat veteran. welcome. >> thank you. lori: 150 years has passed since gettysburg but given your rank

and experience can you help us better understand what it was like for the generals of hattiesburg and the tens of thousands of men fighting in this battle and how it influenced our american history? >> this was affecting the outcome of what this nation looks like today. affecting abraham lincoln, this speech at the gettysburg address and how the nation finally came back together. civil rights movements, a multitude of things but if you look at gettysburg it is the icon of the civil war, like normandy in world war ii and europe. it had a significant impact in a way forward for this nation. lori: i think one of the biggest debates in military history is who won the battle of gettysburg. it was really just the beginning of the end for the confederacy as both sides were wiped out

with those casualties. so who won? >> i agree with that, the confederacy came up here for logistical reasons, they came up to strike fear and political advantage against the union forces in the united states of america with the failure of the battle to turn the tide and at the same time you have to understand along the mississippi that happened almost simultaneously so it was a double blow for the confederacy. it did hurt general lee tapley. the decisions of general in battle, the leadership, their use of recognizance, how they would ground to trim the outcome of this battle and he suffered immensely from it. lori: from a military perspective considering right now wee we're fighting wars, wrapping up wars, such a tough time, for our armed services, is

there any way to contain two civilians what it is like to be fighting for your country? i am personally curious if you can shed some light on what it would have been like to be on the battlefield 150 years ago. speak to all battlefields are the same in the carnage and the blood, the death of citizen soldiers and it is always asked why when you're in a battle you're motivated and fill you have a reason why. you have that feeling. afterwards we start to think back is it worth it, why did we lose lives, what is the outcome, did we quit? that affects the past and present and going into the future. there are things that never change in battle, and there are things that do change. leaders understand the train and have good recognizance and

understand who is on your left, you're right, weigh what might n over the ridge line. things that do change is technology. logistics, they change constantly. but the principles of leadership, geithner, since and how you mask your equipment at the right place at the right time never changes. lori: it is a national treasure, but obviously with sequester cuts and so many broader budget issues the country is facing, might be in a little bit of jeopardy. what do you want to see done and how necessary it is to preserve this landmark. >> that is a great question and i will tell you gettysburg is a terrific example of public, private partnerships that allows with tapping these three days july 1 through the third at gettysburg without that partnership it would not have been. with other budget cuts it is

difficult for the park services to do it itself. because it was gettysburg, in partnership with the foundation, they are allowed to use the private sector support morally and with the will of giving in order to improve upon the educational programs. i don't know how you can do it in the future. this is a great example of that. it is important to understand the outcome of the nation. lori: thank you so much. massive protest in egypt as demonstrators turn their frustration on the muslim brotherhood. is it headed for a violent sequel? terrorism expert joins us next.

♪ lori: breaking news. investigators in central arizona launching an investigation into how a fast-moving fire killed 19 special train to firefighters, the greatest loss among firefighters battling a fire in 80 years. eighteen of the 19 men killed were part of an elite firefighting team. they manage to deploy safety devices designed to deflect heat and trap breathable air, but the fire shelters ultimately failed. the fire is still at 0 percent containment and has grown to 8400 acres. the brutality -- brutally hot temperatures showing no signs of letting up, much of the southwest right now seeing temperatures approaching 120 degrees. forecasters expect triple digit temperatures to continue at least through wednesday.

the temperature in death valley hit 129 degrees yesterday, just 5 degrees below the hottest temperature ever recorded on earth. 129 degrees was enough to set an all-time record high for the month of june. las vegas also saw its record high of 117 degrees yesterday, and he is being blamed for at least one death. turning back to egypt got thousands of protesters continued to call for the resignation of the president following a warning from the egyptian army saying it would impose its own road map for the country unless the public demands were met within 48 hours egyptian armed forces denying its earlier statement amounted to a military coup saying it was responding to the pulse of the egyptian street. joining me ow, fox news at middle east and terrorism analyst. welcome. >> thank you for having me. lori: in reading some of your worst -- recent works, the real

hair of spring. that is what happened. what is going now is even deeper and perhaps more critical. >> actually, it is the highest moment. the first, we also a in january january 2011 whereby youth, women, minorities took to the street nd launched the first uprising. they were followed later by the brotherhood who are smart, organized, funded backed by a lot of media and the most important thing, backed by the administration. so he was actually collected last year and promised a lot of things on the economic level, political level and beyond. he did not deliver and acted as an oppressive force. in so we see right now is a demonstration. lori: explain the role of the egyptian armed forces backing off earlier statements that were interpreted as a coup.

now it seems the army does not want to a role in politics. what is the army's role and what is his desire? >> the army, it's a national and institution, an institution that advise the country. the army has the beginning of the arabs bring let go of mr. mubarak because the people in egypt have demanded this. now, mr. morrissey tried to modify the leaders of the army removing about 80 high-ranking officers and appointed more as an honest officers 85 percent of the army of egypt is not with the muslim brotherhood, but there are very careful. they don't want to step into politics, former military regime, under the pressure of international community, but so the first day amid was directed at him. do not give us orders to crush the rebellion.

the second is to tranquilize the international community. we are not going to be a military regime. that is basically what will tell us that the rebellion or uprising at the end of the day, the next government of egypt and the army will not step into politics. lori: their will be another government. you think this will happen soon and it will not, if i understand you correctly, include the president. >> it is impossible for him to rule egypt a demonstration of 20 million people. at the height of the arabs print we had one half million people in beirut. we have never seen. this is a symbol of determination of the egyptian people, but they don't want to the brotherhood. more important, president obama who actually said we're not going to metal, at this point in time he can correct history and

say, let the egyptians choose a new president. lori: our position has always been it is not our job to it ccoose the egyptian leader's. so who would you -- who should the u.s. back assthe next leader of egypt's? is there a good potential right now? >> first we need to listen to the egyptian opposition. listen to the leaders of the 20 million demonstrators. so over the past two years the muslim brotherhood and the white house, the embassy opening its doors to the muslim brotherhood, but not the others. it is time to rebalance our position in egypt and then listen to the other, that women secular middle-class. that would be with the administration should be doing. lori: the first arab spring which was even less important as what is going on right now did devolve into chaos and violence. what are you hearing right now? is it still civil or not? are you concerned about it?

>> i am concerned but for the following reason. i am not concerned about civil society demonstrating. imagine millions and millions. they are not going into the path of militarization. i am concerned, being pressured to get out of power, ordering his militia to act against the misters. this is why the position of the army is important. it is not to back off the demonstrators but to protect them. so if he chooses the armed struggle against the demonstrators it to be chaotic. if he abides by the will of the people of think there would be a civil war. lori: for up today for now. thank you for your expertise. >> thank you for having me. lori: up next on the democratic face of the gang of immigration bill saying the house has to take up this bill. we will show you next what the speaker and his republican caucus will not be taking his advice. stay with us.

♪ lori: a new report by the "wall street journal" morning that the health insurance rate could double or triple for some people under obamacare. among those expected to take the biggest financial it when the law takes full effect, youngbear, help the americans to do not have covered sir an employer. that is about 20 percent of americans. senator -- senator chuck schumer is climbing the house will pass the gang of a comprehensive immigration bill despite the speakers plans to the contrary. >> i believe that by the end of this year the house will pass the senate bill. i know that's not what they think now and will say, oh, no, that's not what will happen, but i think it will. lori: joining us, and an institute fellow contributing editor heather macdonald. >> thank you for letting me on. lori: here is where we are. passed the senate. to be determined in the house. the house speaker said it would

be dead on arrival. let me get your take on the components of the legislation as it stands. particularly in favor? >> well, it makes a move in the right direction of realizing that high skilled immigration is extremely important for this country. it is going to make it easier for people that are graduating from our science programs to get green cards, and that i completely support. unfortunately continues the status quo with family reunification and allowing in massive amounts of low-skilled immigrants to come often with the best of intentions, and many of them are enormous credits to their communities but nevertheless the over the long term put an enormous cost on the taxpayers. california where i am right now has just passed a law that governor jerry brown initiated district taxpayer funding from

successful middle-class schools and send them to schools with high proportions of english learners because we have, despite billions of dollars of investment, proven unable to close the achievement gap between the largely low-skilled hispanic population and the rest of the state. what we need to do in order to advance economically. lori: understood. want to get in here with this. the immigration bill will be taken up in the house. other analysts have suggested it will be taken apart and the with piecemeal. what you just talked about, will that be addressed? do you think the house can come up with some kind of legislation that will appeal to conservatives? >> i think if they stick to their guns they will. the bill just came out of the house judiciary committee and representative good lap which is a fabulous idea and is one that shoulddbe pressed enormously, which is to get rid of sanctuary cities, allow local law enforcement officers to parricipate in immigration enforcement. it is the proponents of the gang

of eight built saying they are in favor of enforcement. this is the test. so far the bill is rife with loopholes. it allows legalization first and enforcement is of long-term promise. if we really believe in enforcement, let's start enforcing the law now. the house has already put the -- started on that direction. lori: tell me more about those llopholes. the senate bill allocates 38 billion for security personnel, drone aircraft, sensors, other items that they maintain will be appropriated in advance. tell me about these loopholes and why you don't think these policy measures are not effective, and effective? >> to be honest, they -- graphics said it on offense. the fence in the bill, mostly and ambition, it does not have to have it -- happen.

the secretary has an exemption, does not have to build it. it only adds 350 miles to the existing 350 miles and can be held up indefinitely by environmental concerns. will we really need is internal enforcement. why i am skeptical about the long-term fate of this comprehensive immigration reform is for the last decade we have seen the advocates press insists his campaign. the secure communities program which merely alerts the federal immigration authorities when an illegal alien is booked into jail, that program which should be a no-brainer is under attack everywhere. los angeles pulled out, illinois pulled out, new york state. if we allow legalization first, which is what this bill does a few months after passage every illegal alien virtually will qualify for legal status,

so-called provisional, but it will never be revoked. we should have enforcement as well, and that won't happen. lori: thank you for the analysis. >> thank you. lori: we will check back in soon. well, interest rates, you probably heard, new government-backed student loans, double what they were last week. that is thanks to the congress failure to tackle the issues before leaving town for the fourth of july. the rate hike its new stafford loans. lawmakers could still pass a bill to undo the damage, but the 113th congress does not have the best track record when it comes to getting work done. so far only 15 bills have become law compared to 23 at this time last which was constantly mocks as the new do nothing congress. of course if you're a small government conservative you may consider the lack of action something to celebrate.

up next, police investigators take the stand and offer bombshell testimony to determine if george zimmerman murdered martin r. was simply fighting for his life. "dobbs law" is on the case next.

♪ lori: jurors in the george zimmerman trial are hearing from police investigators. he told investigators how he shot martin, reenacting the event's one day after the shooting. [indiscernible]

he said you're going to die. and he reached for it. he put his arm down. i grabbed it. i grab my firearm. lori: joining me now, criminal defense attorney and former federal prosecutor doug burns. hi. so, watching george zimmerman detail what he went through the moment before and after the shooting, he seems really bothered and stressed out and set about it. very credible. >> says. today was such a good day for the defense. if the jury had to make up their minds this afternoon zimmerman would be going home. think about what the prosecution did. they put on this video which completely humanize him. up until now no one has heard his voice. he explains exactly what was going through his mind and why and does come across credible with no opportunity for the

prosecutor to cross-examine him. the key point was when he said, i thought that he was going for my gun. so far the prosecution has been saying, he shot an unarmed kid. the kid according to ham was about to become armed. i think that was a crucial moment for the defense. lori: your reaction to every the prosecution so far, the witnesses cannot talk about credibility. you can't really point to that. >> i agree. i think at the end of the day this case will go into the legal textbooks as a burden of proof. lori: that little thing. >> it will show what would you talk about, the tide goes to the runner. all these different versions. nearly a fist fight and he overreacted. then you have these different versions, what you talking about . december's be smashed into the concrete. if you cannot differentiate between those simple battle flourishes then the tide goes to the defendant. lori: it's interesting that he himself likely will not take the

stand. if the prosecution makes a big this -- makes a big mistake by playing these videos and letting the jury sees zimmerman in his own words talk about how use the word humanizing, credible. he's making his own case and being successful. >> a gigantic mistake because up until today zimmerman has to testify because we have to know. that is the crux of the case. now that they put on this video, he is not upset. he seemed very even keel. he does not seem racially motivated. now i get it. he does not have to take the stand. >> heads in his hands, bandage on his forehead. >> it's really hard to appreciate, his demeanor and the way he appears in court, as crazy as this sounds, really does not seem consistent with a criminal.

i know that sounds weird. he seems calmed, straightforward and his words are coming through. let me get back to one the zero other technical support. the judge ruled that they could not put into evidence 911 call where someone was screaming because that would have an expert to say that it was the victim and another expert to say that it was the defendant. meanwhile, the government witness comes in and says, we cannot tell what was. >> at think we can play it. the voice expert testimony. >> do you need police, fire, medical? >> maybe both. i'm not sure. there is someone screaming outside. >> so hard to differentiate. how do you prove that? >> exactly. the key is that the state's own witness was like, i'll never be able to tell. does leave it up to the family. if you are the state witness, an

expert trained by the fbi cannot tell, you think is mom will? of course they will both say it was their son. >> they tried to save it by saying, the family -- this expert literally said despite technical voice expertise, a family member might be better off. okay. the victim's family, but then comes the killer. there may be listener bias. >> tell me what the prosecution needs to do. >> this some new witnesses at. lori: are there? >> well, all joking aside, the case is what is. i do not think that we should prejudge it. we don't know what will happen. jurors could theoretically conclude that too much force was used. right now i feel that the case is going poorly for now. lori: that's what i would be

doing. thank you. well, that's just about it for us. thank you for joining yes. be sure to check out markets now

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oh, yeah, sorry! let's get ready to bundle and save. now, that's progressive. oh, i think i broke my spleen! home insurance provided and serviced by thirdarty insurers. neil: why just tick off americans when you can tick off the world? welcome i am neil cavuto, give ed snowden some credit. he knows how to alienate frien friends. we might not have to worry, we'll soon be down to no friends, reports we bugged europe union offices including those in washington and u.n. e.u. foreign policy chief demanding urgent clarification, and france would say such acts if unconfirmed would be unacceptable. >> then the