my presidency is entering the fourth quarter. interesting stuff happens in the fourth quarter. and i'm looking forward to it. but, you know, going into the fourth quarter you usually get a time out and now looking forward to a quiet timeout. christmas with my family. so i want to wish everybody a merry christmas, happy hanukkah, happy new year. i hope you all get time to spend with your families as well. now, josh has given me the who had been naughty and who has been nice list. i will use it to take some questions. >> thank you mr. president.

north korea seems to be the biggest topic today. what does the response look like to the sony hack? did sony make the right decision and pulling the movie? >> let me address the second question first. sony is a corporation. it suffered significant damage. there were threats against its employees. i am sympathetic to the concerns that they faced. having said all of that, yes, i think that they made a mistake. in this interconnect did digital world, there will be opportunities for hackers to engage in cyber assaults both in

the private sector and public sector there. our first order of business is making sure we do every day to pardon site and prevent those sort of attacks from taking place. we need to look at everything we can do at the government level. we need to prevent these types of attacks. we have been coordinating with the private sector there. a lot more needs to be done. we are not even close to where we need to be. one of the things i hope congress is prepared to work with us on is stronger cyber security laws. information across private sector platforms as well as the private sector so that we are incorporating the best pack this is. even as we get better, the

hackers will get better too. all of them are going to be educated and many of them can do some damage. we cannot have a sociéte the in which some did taters someplace can start imposing censorship here in the united states. if somebody is able to intimidate folks out of releasing a movie, imagine what they can start doing when they see a documentary that they do not like or news reports that they do not like. even worse, imagine if producers and distributors and others start engaging in self censorship.

because they do not want to offend the sensibilities of somebody who needs to be offended. that is not what america is about. again, i am sympathetic that sony as a private company was worried about liabilities. i wish they had spoken to me first. i would have told them do not get into a pattern in which you are intimidated by these kinds of criminal attacks. imagine if, instead of it being a cyber threat, somebody had rogan in to their offices and destroyed a bunch of computers and stolen disks.

is that what it take for you to suddenly pull the plug on something? we will engage with the film and news industry around these issues. we already have. we will continue to do so. they will be costly. they will be serious. we take them with the up most seriousness. we cannot start changing our patterns of behavior anymore and we stopped going to a football game because there may be the possibility of a terrorist attack.

>> would you consider taking some sort of symbolic steps like watching the movie your self? >> i have a long list of movies i am going to be watching. [laughter] >> let's talk the specifics of what we now know. the fbi announced today and we can confirm that or korea engaged in this attack. it says something interesting about what korea that they decided to have the state mount an assault on a movie studio starring seth rogen. and james franco. i love seth.

i love james. the notion that that was a threat to them gives you a sense of the kind of regime we are talking about here. they cause a lot of damage. we will respond. we will respond proportionally. it is not something that i will announce here today at a press conference. more broadly, though, this point to a need to work with the international community to set up some very clear rules of the road in terms of how the internet and cyber operates. right now, it is sort of the wild west. you have the week states that can engage in these kind of attacks. you have nonstate actors.

that is what makes this issue of cyber security so urgent. this is part of the reason why it is so important for congress to work with us and get an actual bill passed. if we don't put in place the kind of architecture that can prevent these attacks from taking place, this will not just the effect the movies. it will be affecting our entire economy. by the way, i hear you are moving to europe. where are you going to be? >> brussels. >> congratulation. >> i think that there is no dow that what bill jim needs is a version of political.

[laughter] the waffles are delicious fare, by the way. you have been naughty. >> looking ahead, you mentioned tax reform. i am wondering, give them preventing a better opportunity of actually getting tax reform next year? will you be putting out a new proposal? are you still concerned about corporate version? >> i think an all democratic congress would have provided a better opportunity for tax

reform. i think talking to speaker boehner and leader that all we will get that stuff done. i think in the coming weeks leading up to the state of the union, there will be conversations. about what both each will be looking at. i will tell you broadly what we can see. we would like to see more simplicity in the system. for fairness system. 35% higher than just about any other company. there are outbursts. that is not her there are companies that are parking money out the side of the country.

that is because of tax avoidance. we think that is important that everybody pay something. they are headquartered in the united states. those are situations where companies really are not header headquartered here, but, on paper, they see if they can avoid paying their fair share of taxes. i think that needs to be fixed. fairness, everyone taking responsibilities. i think that will be very important. some of those principles, i have heard republican say that they share. per the devils in the details. i will be interested in seeing it they want to move forward. i will see that we put forth some pretty specific proposals.

i have been on this now for six years. we have a lot of infrastructure that we have to rebuild in this country. electrical grids, water systems, sewer systems. we are way behind. early on, we indicated that there is a way of less potentially doing corporate tax reform. during that transition also providing a mechanism where we can get some infrastructure built. i would like to see us work on that issue as well. infrastructure has not been a democratic or republican issue. i will see if we can return to

that tradition. >> i want to ask about cuba. addressing human rights and their political system. why not do the same with cuba? do you have any indication? >> we have no indication that cuba was act in conjunction with another company. we are glad that the government has released slightly over 50 dissidents. they will be allowing the national committee of the red cross and the united nations to operate more freely inside of

cuba. i share the concerns of dissidents there. this is still a regime that represses its people. as i said when i made the announcement, i do not anticipate over the night changes. what i know deep in my bones is if you had done the same thing for 50 years and nothing has changed, you should try some thing different. this gives us an opportunity for a different outcome. suddenly, cuba is open to the world. in way that this has not been before. it is open to americans traveling there in ways it has not been before. it is open to church groups

visiting their fellow believers inside of cuba in ways they have not been before. it chips away at this for medically sealed society. i believe it offers the best prospect of leaving towards greater freedom, greater self-determination on the people. i think it will happen. true engagement, we have a better chance of bringing about change than we would otherwise. >> i think it would be unrealistic for me to map out exactly where cuba would be.

change will come to cuba. it has two. they have been reliant on years. those cannot be sustained. the more the cuban people see what is possible, the more interested they will be in change. how society has changed is country specific. it is culturally specific. it could have been slower than i would like. lesley clark. >> i have a number as well. >> i wanted to see if you had anything from the government?

sabotaging a deal. >> when the clinton administration -- they sort of have this provocative act committee at the time. being that okay. >> i wanted to see what your knowledge was? did you have any role in the talks? did you ask about him? how is he doing? given the opposition from some republicans in congress, are you going to constantly get into

models? [laughter] >> you are taking up a lot of time. with respect to sabotage, my understanding of the history is the plane being shot down. not the cuban government purposely trying to undermine the administration. it was a tragic circumstance that ended up collapsing. i have not seen a historical record that suggests they shop the plane down specifically to undermine the government. it is not precedent did for the president of the united states

and the president of cuba to make an announcement at the same time that they are moving towards normalizing relations. there has not been anything like this in the past. that does not mean that over the next two years, we cannot anticipate them taking certain actions. either inside of cuba or in respect to their foreign policies. that is true of a lot of countries out there. the whole point of normalizing relations is that it gives us a greater opportunity to have influence with that government and not.

i would be surprised if the accusing government purposely tries to undermine what is now effectively its own policies. i would not be surprised if they did not take actions that we think are a problem. we will be in a position to respond to respond the same way we do with other countries around the world when they do things that are wrong. the point is, we will be in a better position to actually have some influence. i delivered a fairly late the

statement at the front end. we will continue to press on issues of democracy and rights that we think are important. my opening remarks took probably about 15 minutes. at the end of that, he said, mr. president, you are still a young man. i apologize for taking such a long time. i want to make sure that before he was very clear about where i stood. he said do not worry about it mr. president. he wants spoke seven hours straight. and then president castro

proceeded to his own remarks that lasted twice as long as fine. i was able to say that it runs in the family. that was the only discussion of fidel castro that we had. [laughter] >> how personally involved will you get? >> we cannot, it unilaterally, bring down the embargo. what i do think will happen is there will be a process where congress digests it. there is bipartisan supporters of the new approach. people will see how the actions we take on full. i think there will be a healthy

debate in side of congress. i think that ultimately, we need to go ahead and pull down the embargo which i inc. is self defeating in the names we are anticipating. i do not anticipate that that happened right away. all right. here you go. >> i want to follow that by asking what decisions you will make. will you have to increase predictions? i know that you said, are you going to say why you are can do during economic sanctions? can you rule out the use of military force?

>> i think that i will leave it where i left it. we just confirmed that it was north korea. we have a working range of options. i will make a decision on those based on what i think is proportional and appropriate. with respect to cuba, we are not at a point where me visiting cuba or president castro coming is in the cards. i do not know how this relationship will develop over the next few years. i am a fairly young man. i imagine at some point in my life i will have the opportunity to visit cuba and enjoyed interact in with the people of

cuba. >> you spoke earlier about 24 team being the year. you did not make much progress with your legislative agenda. are you going to continue to pursue executive action? have you concluded that it is not possible. >> i think that there is real opportunities.

i think that the american people would like to see them get a few things done. the question will be, will we be able to separate out those areas where we disagree? those areas where we agree. there will be some tough fights. i will say no. i am confident that i will be able to uphold those types of provisions. on increasing american exports on simplifying our taxes some on rebuilding our infrastructure, we can get some things done.

i have never been persuaded by this argument. they would have been more proud of this. there is no evidence of that. i continued continue to contend what i have been doing. i see a bit problem. side by side, i out to members of congress. i will say, let's work together. i would rather do it with you. i was really happy when it says senate passed a bipartisan immigration bill. i did everything that i could for a year and a half to provide republicans the space to act and show not only great patience, but flexibility.

saying to them, if there are specific changes that you would like to see, we are willing to compromise. we are willing to work with you. the question will be, if executive actions on areas like minimum wage or equal pay or having a more sensible system all our actions, there is a very simple solution. work with me to make sure i am willing to sign those bills. on most issues, in order for their issues to become law, i will have to sign off. that means they have to take into account the issues that i

care about just as i will have to take into account the issues that they care about. i think that this is going to be our last question. when you talk about this impact, more than you keep it, do you see that bill? also, what do you see as a benefit? does it change in terms of climate change? >> at issue in keystone that

audio currently is being shipped out through a rail or truck's and it would save canadian oil companies and a canadian oil industry an enormous amount of money if they could simply pipe. all the way through the united states down to the golf.

there is nominal impact on u.s. gas prices. sometimes, lower gas prices are in the united states. it is good for the oil industry. it will not be a huge benefit for u.s. consumers. the construction of the pipeline it self will create a couple thousand jobs. there is probably some additional jobs that can be

created in the refining process down in the golf. those are not completely insignificant. it is just like any other project. when you consider what we could be doing, something that congress could authorize, you could create hundreds of thousands of jobs. if that is the argument, there is a lot more direct ways to create well-paying american construction jobs. i want to make sure that if in fact this project goes forward, that it is not adding to the problem of climate change which i think is very serious. some of them long-term, but

significant costs, nonetheless. there are direct economic impacts on not. we are having to come thither how we increase preparedness and how we structure the infrastructure and housing and so forth along the jersey shore. in terms of process, you have a nebraska judge that is still determining whether this new path is appropriate. i am just trying to get this this. there is tendency to really

hyped this thing as some magic formula. to what ails the u.s. economy. it is hard to see on paper where exactly they are getting that information from. the gas prices are lower. answering the lowering gas prices. the oil that would be piped through the keystone pipeline would go into the world market. we will take that up in the new

year. [talking over each other] >> thank you, sir president. last question. six years ago, i asked you about black america in the oval office. you said it was the best of times and the worst of times. the best of times in a sense there has never been more opportunities. the worst of times for unemployment as a lack of opportunity. >> black america is better off now than when it was when i came to office.

housing equity that has been recovered. for a one pension. a lot of those folks are african-american. better off than they were. the gap between income and wealth of white and latin america persists. we have more work to do on that front. i have been persisted in saying that this is a legacy of a troubled past. it is not an excuse. i think the majority of black people understand that it is not an excuse. what is true for all americans is we should be willing to

provide the handout. hope folks get that good, early childhood education. help them graduate from high school. help them afford college. some progress and education forms that we have initiated are showing measurable results. we have the highest high school graduation that we have seen in a very long time. we are seeing record numbers of young people attending college. many states have initiated reforms. you are seeing progress in math and reading sces. we still have more work to do. obviously, how we are thinking of these relations right now has been colored by ferguson, the

coroner case in new york, a growing awareness in the broader population of what many communities of color have understood for quite some time. that is that there is a specific instances at least where law enforcement does not feel as if it is being applied in a colorblind fashion. the task force that i have formed is supposed to report back to me in 90 days. not with a bunch of abstract musings about race relations but some really concrete practical things. they can begin implementing this right now.

my intention is, as soon as i get those recommendations, to start implementing. some of them will require congressional actions. i think it has been a healthy conversation that we have had. these are not new phenomena. the fact that they are now surfacing in part. it had just been in the past around the kitchen table. it allows people to make their own assessments and of valuations. in the meantime, we have been moving forward on criminal justice more broadly. one of the things i did talk about in my opening statement was the first time in 40 years where we have the federal prison

go down at the same time. it indicates the degree in which it is possible for us to think smarter about who we were incarcerated and how we are dealing with drug offenses, divergent programs, drug courts, we can do a better job and save money in the process by initiating some of these reforms. i am really pleased to see we have republicans and democrats in congress interested in these issues as well. this will be the last thing that i say. one of the great ends about this job is you get to know the american people. you meet folks from every walk

of life. what i don't think it's always captured in our political debates is the vast majority of people are just trying to do the right thing. people are basically good and have good intentions. sometimes our institutions and our systems do not work as good as they should. sometimes, you know, you have a police department that has gotten into bad habits over a period of time. if you offer practical solutions, i think people want to fix these problems. it is not a situation where people feel good seeing somebody choked and died.

i think that troubles everybody. there is an opportunity of all of us to come together and, you know, take a practical approach to these problems. i guess that is my general theme for the end of the year. we have gone through difficult times. it is your job for us to report on all of the mistakes that are made and and all that that things that have happened. i understand that. too persistent effort and faith in the american people, things get better. the economy has gotten better.

uber is a real crisis. it is not something that has been seen before. you have some unaccompanied children. when we work together, we can not be stopped. now i am going to go on vacation.

>> there you go. that was president president obama wrapping up his year end address. that was a long one. >> he feeds off by saying it is real. we were better off when he took office. sony, the fbi hacking, sony made a mistake not releasing the movie. the u.s. will respond appropriately. ways to respond from his team. he also spoke about cuba. he noted, though, that neither president will be visiting the other's capital anytime soon. he will not put out a detailed proposal within the new year. and increase in revenue upfront.

he downplayed his benefits. he was asked directly, would you veto a bill that approved the keystone pipeline? i will see what congress does. we will revisit that in the new year. >> i have my panel for reaction. fox and friends weekend. it is math and we are not. our employment is getting better, i should say. the gdp is better than when you started. we are not in freefall as we were when you took office. this is the biggest wealth disparity creation under the

most conscious president we have had in decades. the middle class and the poor have been squeezed. >> statistics today, more people unemployed compared to 2007. on and on, black unemployment -- >> you notice some thing very interested on who he called on. >> eight questions. >> all that time? eight questions? >> he only called on women. also, jonathan karl. all three of them.

he actually referenced it when we were talking about that. talking about experiencing this by any metric. we have gone through some of them that would perhaps contradict that. the key point is the american people do not leave that. the american people do not believe it. >> he basically condemned the nation's police forces. listen, everybody on this panel knows there is an issue with the black community and police departments. it seems like it is a recurring theme on the left days. >> i want to point out before we run out of time. he did say that tony made a mistake in his opinion not releasing the film.

he said that he wished they had called him. you know, before they decided to make that decision. if ever there is a use for the national guard, do we send the national guard out? >> it becomes a national issue. you would think that they would call him. >> the opening statement is there are corporations. >> okay. gentleman, thank you to all of you. the most powerful leading man in hollywood. we have the latest. the president warned he is working on a range of actions. more "money" coming up. ♪ ♪ (holiday music is playing)

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>> we have some breaking news right now on the sony hack. >> we have a source close to sony. they actually offshore their network security operations to an asian firm. it works with several companies. it is headquartered in asia. going all the way back to 1987. it includes anybody that is a beneficiary of a sony employee. that number was stolen. there continues to be a tax on

social security numbers. one case trying to get access to financial documents. >> adam, all right. thank you for that report. the president understands the companies struggle. he wishes sony would have contacted him prior. here now is scott martin. we also have jonathan clonaid. they are both fox news contributors. gentleman, thank you both for joining us. you said i wish they would have called me. we still have football games. i wonder if he would have rolled out the national guard? >> he should have, alyssa.

he wishes sony would have called them. this is nothing less than an active war by north korea. talking about hundreds of millions of dollars of property destroyed. it is just as if these hackers came in and walked out with equipment. a lot of people on twitter when i put that out. >> that is the. thing. i hate to say it, i agree with jonathan here. he should have said making the overtures. this is clearly a shot across the bow at one of our leading motion picture companies. to have this kind of intimidation, the president is right. this censorship is even worse.

>> we have to go. thanks to both of you. resigning the fallout. charlie's got it. at the end of the day, it is all about money. ♪ that could be a question of blood flow. cialis tadalafil for daily use helps you be ready anytime the moment's right. you can be more confident in your ability to be ready. and the same cialis is the only daily ed tablet approved to treat ed and symptoms of bph, like needing to go frequently or urgently. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long term injury, get medical help right away for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or any allergic reactions like rash, hives, swelling of the lips, tongue or throat,

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and that's a big reason why the u.s. is a world leader in reducing co2 emissions. take the energy quiz -- round 2. energy lives here. melissa: check out stocks, the dow is up nearly 100 points, sitting at session highs. oil prices holding onto gains, up about 4.5%. the wall street banker at the center of an ugly divorce battle resigning. charlie, you were the first one to -- >> sage kelly resigning from jeffrey's. here's what we're getting from people, they say the fallout goes beyond bad publicity. somehow this controversy has had a business impact. they've lost some deals, not a lot of people are trading with them as much during this period of time. and what it has done, particularly in recent months, is squeeze jeffrey's discretionary bonus pool. so many, many executives have gotten screwed on bonuses. this is what they're telling fox

business, and they say -- they're pointing to the root cause of that, this controversy with sage kelly as business is drying up. now, we should point out that the spokesman says it is categorically untrue that the divorce controversy itself caused this, is the main root of this, but what he won't deny is that jeffrey's is talking a hit on these discretionary bonuses. we should point out that jeffrey's lost money in the fourth quarter, that just came out. so it's hard to believe it had no impact on -- melissa: no. because i've heard people on the street say this is our counselor, the person who's giving us advice on deals, and they have this going on inside? it does have a business impact. >> and not just on the deals, because this guy was major health care banker, so a lot of companies may not want to do ipos or financings with them. apparently, there was so some ie with trading partners because they doesn't want the reputational damage. it's probably going to dissipate at some point. the company denies it's directly

related. melissa: absolutely. charlie gasparino, on top of that story. that is all we have for now. right now the dow is up 87. liz claman and "countdown" starts right now. liz: maybe those fighting words from the president got this market going. thank you, melissa. sony gets walloped again. not by hackers but, yes, by the president of the united states. president obama in the last hour measured but stern saying we cannot let a dictator decide what we watch, and we can't be intimidated. he didn't mix words on sony's decision to pull the plug on "the interview." >> i am sympathetic to the concerns that they faced. having said all that, yes, i think they made a mistake. liz: the president going on to say that's not us, that's not america, to bend to people who threaten our freedoms, which he intimated was exactly what sony did when it canceled this movie in the wake of threats