the final reading on consumer sentiment came in at 93.6. the housing sector on edge. a big day for economic data on this day. it is time for "varney & company." charles is in for stuart today. charles: you have a lot of big stories today. the market had new all-time highs powered by good news. 5.0. hinting that the u.s. could be on the cut moving in to the next year. dow 18,000. maybe just another number. even if it is a aided.

the stock market reflects your play and your determination. everybody needs to feel good about these new days. we have a new congress coming in. 2015 could be a good one. ♪ charles: i felt like i was on a filibuster out there. the dow up 81 points. six dow spots making all-time lifetime highs. home depot. all places for you to spend your money at. >> we have a strong gdp number. we did have a flat number when it came to business investments. what do you make of it all?

>> spending and income were good. the housing number may be a little bit of cold water on a fire. that is all it is. not enough to put the fire out. do not forget, i know you wanted to talk about it later. it has to be noted right here right now. charles: natural gas. heating, electricity. that has collapsed. let's say personal income. consequently savings went down to 4.4%. are we in a position where all of this good stuff does not continue unless we get wage -- >> what you justify and was spending was up probably because

of the gasoline numbers. you see that triple back in to spending numbers. i see that going forward. they will need to be selling more stock. they will be hiring more people. wages will have to go up. there is nothing bad about it. a great way to and big year. charles: rates are at or near zero. it is not rates. what will it take for people to reembrace the american dream? >> owning a home was the

cornerstone. people don't buy a house, they will never buy stocks. people still do not have enough confidence to invest in the future. >> that could be possible. >> what is this telling us? it gets so overheated. i went back 10 years. it is a completely random event that happens in january. you have to look at longer-term. cheryl: another topic.

right now, i want to go to fox news digital editor. i am saying that the president is irrelevant. he is a lame duck. in 2015, that will be one of the good things for the stock market. >> i think that he would disagree with you. we will know a lot more in the second quarter. he has an agreement with hillary clinton that he had the kickoff of the next phase of his executive action phase. he is willing to kick it off they are. he has his cuba deal. there are a lot of initiatives that the president can take. we will see what he does over the first three or four months

of the year. >> here is the thing. the midterm elections to me spoke loud and clear. it really does not matter at this point. i think hitching his wagon to hillary clinton may even be a big mistake. i am no fan of hers, but she certainly knows how to rile up the crowd better than hillary clinton. i am really excited about what kind of deals can be done or will they stick with executive orders? >> the president has hinted several times that he is interested in such a tax deal.

nothing the president has indicated he is interested in. the president has a narrative of the new year. he will be exceedingly liberal. he will be all things to all people. here is what we absolutely no. this is a president that has largely been affected by events. i would think that with the that case. i would think that that extent of the commitment in afghanistan and all of these things will make the president not only relevant, but it will affect markets and the national discussion. charles: all of those things that you named -- first of all, i have to tell you. it feels like we are getting out of afghanistan unless ices

really starts to revamp itself. i think we have elevated them higher than they had to be with this hacking scandal. domestically, where does the president have any strength around here? >> i think they phrase it a little differently. immigration is going to be enormous. remember, we get to february and it is so time. that is coming up as well as a series of fiscal cliffs. the president and his deep, deep divide.

we read from politico over the weekend a piece that basically said that the president was ensued. that is where we have been before. charles: a cheerful day for all. back to oil. sitting around 56. obviously, you know eight name or two about loyal. this is still the gift that keeps giving. >> very bad for the people. very bad for russia. they do not like this.

it makes them struggle as well. there is a lot of talk about why oil is still down. saudia arabia who is known as a swing producer is overproducing. they are producing 10 billion barrels a day. >> the motivation, they are trying to drive the high cost thrillers and crackers on business.

>> they have been hammered unmercifully. so dramatically. we do not talk about it. look at that price. >> $1.25. in a few months, it was trading $14. and other volatile market. when they do that, the prices of gasoline go down.

you will see it going forward. all good news. >> you do not expect it to go back above 100 any time soon. oil was $10.50 barrels as well. it was not that long ago. i was here one week ago. trading $73 a share.

it is now trading $81 a share. what you just pointed out. some of the names take you from all aspects of energy. the names are so beaten down. so hard. they are overdone. >> i think that the street was factoring in junk bonds. was china actually working with north korea? if they were, does this mean our relationship with beijing is on even thinner ice? we will break it all down. ♪

she's still the one for you. and cialis for daily use helps you be ready anytime the moment is right. cialis is also the only daily ed tablet approved to treat symptoms of bph, like needing to go frequently. 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, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a free 30-tablet trial. oh what fun it is to ride. get the mercedes-benz on your wish list at the winter event going on now - but hurry, the offer ends december 31st. [ho, ho, ho!] lease the 2015 c300 4matic for $419 month at your local rcedes-benz dealer.

charles: they have that thing ready for about one month now.

time now for your morning gold report. not such big news. keep in mind, i am sure is you do not need me to tell you this. not all stocks are winners. nicole: .biotech index index is one of the great performers. best-performing group of 24 came. today, seeing some profit. the nasdaq in the red. look at some of these names. there is some heavy selling pressure on this particular group. there could be some profit taking on their way. dramatic moves to the downside.

energy, consumer stocks, industrials. the number one performer is materials. healthcare is in the red. charles: thanks a lot, nicole. appreciate it. >> threatening the media with lawsuits if they reprint this stolen information. the printer does not comply. it could. >> i don't know. give me a break. monitoring all of these sites. something from the sony hacks.

give me a break. >> and he really chase down everybody? posting this information and saying you may want to higher your own attorney. >> over the weekend i saw a variety of different people from all sides of the spectrum saying, hey, boycott sony. >> the administration threw them under the bus. charles: they want to sue someone? go ahead. go for it. go find yourself a bunch of unemployed people. you will really sue people now after your cyber security was notoriously poor? charles: give me a break.

china is denying reports that they did help north korea. gordon chang joins us. you think north korea and china are inca boots with this. >> well, certainly. these hacks did not come from north korea. that is consistent with what technical journals are now reporting. right now, we do not have consistent proof on this. more than half of the cyber warriors are based in china. the icing on the cake is the firewall. we saw it. you had all of this information going out of china crossing the firewall. terabytes coming back in to china. those north korean hackers have been there for about one decade.

>> are these guys just so great that they brought them in to help them out? what is in it for china? >> that is a great question. china has sort of been using north korea. charles: as proxy. >> as proxies. we run to beijing and say please, please, please help us. >> that happens all the time. the chinese just love this. it advances foreign-policy goals. charles: it is a dangerous game. after all, look at who their leader is. this can backfire on china may be at some point.

the north koreans do not like the chinese. this goes on for 600 years where you have that border moving and both directions. this is only a short-term play. >> china does not want refugees flooding and. >> when north korea has real problems, those refugees will mostly go south to be with other koreans. not forced in to china where they do not like the chinese and the chinese do not like them. >> thanks a lot, buddy. a massive storm could cause nightmares. we will tell you if your holiday travel plans could be ruined by this nasty weather. we will tell you after the break. ♪

♪

make the best entertainment part of your holidays. catch all the hottest handpicked titles on the winter watchlist, only with xfinity from comcast. r green mountain has a recall, 7 million brewing machine in north america overheating liquids and burn users. don't let this drop, stocks still up 80%. absolutely amazing. the forecast it isn't looking good for folks who want to

travel for the holidays this week in. maria molina is in the weather center to tell us what facing our out there. maria: this is producing all kinds of travel hit the send one of them is in the form of severe weather. we have a tornado watch that was issued a few minutes ago and this includes portions of the gulf coast, louisiana, mississippi and alabama are looking at that record tornadoes. we had multiple 20 warnings issued through morning hours but those have been lifted and now we are looking at a severe thunderstorm warnings in effect. we're looking at some strong wind gusts associated with storms and the severe weather risks will move eastward including portions of florida, george and also extreme southern parts of south carolina the risks being tornadoes and damaging winds with those storms. we had delays that are piling up at the airport especially across parts of the northeast, new york city delays averaging an hour

and a -- fill the international looking at them averaging 30 minutes but that makes it a lot worse as we head into tomorrow with at storm system intensifying and impact portions of the eastern united states and showers and thunderstorms and areas of heavy rain, heavy in some locations that we could be looking at more than six inches of rainfall across portions of the southeast so we do also have a flash flood threat in place out there. number of what is in effect across the southeastern united states. otherwise the other concern is strong winds. on the backside of the storm system portions of the upper great lakes and also the midwest are going to be looking at snowfall totals generally half a foot in some of the heaviest snow bands but you will be looking at that white christmas for some of view across portions of the greek lakes and the new storm arrives as we head into wednesday, this would impact in portions of the pacific northwest. let's get to you? charles: we all know pope francis doesn't shy away from

speaking his mind but you won't believe what he told a group of church leaders days before christmas. up next, why he thinks some top church officials are suffering from spiritual alzheimer's. ♪ you don't need to think about the energy that makes our lives possible.

because we do. we're exxonmobil and powering the world responsibly is our job. because boiling an egg... isn't as simple as just boiling an egg. life takes energy. energy lives here.

thanks. ♪ [ male announcer ] fedex® has solutions to able global commerce that can help your company grow steadily and quickly. great job. (mandarin) ♪ cut it out. >>see you tomorrow. ♪ charles: check it out, the dow,

a long time to oil down 50 bucks. and some equilibrium here, levels to see gas prices dropping and dropped another $0.02 overnight, $2.37. we have 28 states with one station has gas below $2 a gallon. look at that map. and at westering convenience in colorado. strong words from of the pope. a 15 point catalog of spiritual diseases, liz macdonald is our resident catholic. the holy father took the words of these guys. >> no christmas card from of a pope to the vatican bureaucracy, which is 3,000 strong. a withering critique, he blasted

them, sharply criticized as them. he said they are power and glory clerics guilty of cold-blooded killing the reputation of their own colleagues engaging in satanic assassination of people's good teams, looking obsessively at their own image, walking around feeling in more land in the june and he is saying enough is enough, time to stop. charles: kardashian household. liz: he cites the spiritual emptiness he is seeing in the curio. no academic degrees can fill. really sharp words. charles: are these the same polk -- they lifted him. liz: lifted him to the job. he's an outsider. he didn't historically worked in round and seeking to restore it with a coterie of individuals that might change the catholic church and start at your own kitchen table. charles: i don't agree with everything the pope has said so far but this pope has been so

electric and my wife is a catholic also and i also see the ministers and her church and you feel the vibrancy, the use are coming back. for someone to do that is an example of leadership. we don't see that in american politics. that kind of leadership to dress down your own intelligence 3. liz: still waiting for that in cyclical freedom and democracy, blasting communism, the evils of socialism as well. maybe we will see that from the pope next year. before i tell you what, you have to admire the man no matter what, no matter what you feel about what he said. liz: he has a heart of gold and it was striking when he installed showers for homeless people to clean themselves in vatican city, that was striking.

and reaching out across the world. and we we see more from the pope in 2014, yes. time magazine was right to pick him last year. charles: facing a republican majority, at this moment not only is he a lame duck but irrelevant in his final two years in office. julie woods in ski has gone -- and he just went and did it. it is a lame duck session, killed of the majority, and continue to do this. he looks a little liberated. now no longer has to worry about running for reelection carrying congress. charles: to your point he is doing a lot of things but ultimately run into serious opposition. won't get everything he wants of any of these things he is pushing through against the will

of the law, the will of the people, for me i thought he was a lame duck a long time ago to be quite frank with you, what did he get through other than his signature achievement which is falling apart at the seams. liz: you can't say he is governing like an emperor and then say -- charles: how many executives as he put out? >> i don't know but the presidential memorandum, executive orders, we can't -- liz: they are the same thing. >> of course they are. i don't know what the number is. liz: more than president gw. charles: the bottom line is he is trying to govern as an imperial stick president and that hasn't worked, it hasn't worked for the party or the country and i do think there was a message sent in november whether he chooses to ignore it or not is his prerogative but nevertheless i do feel as someone we think his goal is to get things done unless he finds

a way to put his ego aside. he rode the thing of the pope wrote, he might have to sit in a row by himself and look at it. >> the pope doesn't surrender, at the job for life and can tell everybody to go scratch and he is argentinian and you speak to him in his own language. that was very nice. in a language that he knows. to some extent look at the market. the market is a record high, the biggest job growth since 1999. >> if mitt romney had won you would have said was because of mitt romney. charles: i am telling people for the first time china would give about 50%. they carry the world's economy for the first four years out of recession and 40% as the profits from outside. >> glad you are giving it to the chinese. stuart: whoever is buying our cars buy more cars than we do, they buy more general motors

cars and general motors stock goes up they deserve it. and why don't we buy more cars. we have a record amount of job markets and a record amount of people on food stamps and a record amount of people who are completely discontent. >> biggest job growth since 1999. and construction of the job. if you are happy with a whole bunch of things. >> i'm not happy. the market has gone through the roof. >> 90% of voters didn't -- they're working part-time jobs and are in trouble. let's talk about the republicans. a lot of in-fighting. rand paul, marco rubio, round 1, let them go at it. >> the annual festival thing,

and >> a large part of what you do, they sell from close but repeated to shreds and the eventual nominee. >> it made obama stronger at general election candidate, and helps hillary clinton if the coasts the nomination. charles: 2014, it has been a great year for technology and 2015 could be even better. according to favor to the company will break down the top tech trend for 2015. could protect you from cancer?

what if one push up could prevent heart disease? one. wishful thinking, right? but there is one step you can take to help prevent another serious disease- pneumococcal pneumonia. one dose of the prevnar 13 ® vaccine can help protect you ... from pneumococcal pneumonia, an illness that can cause coughing, chest pain, difficulty breathing, and may even put you in the hospital. prevnar 13 is used in adults 50 and older to help prevent infections from 13 strains of the bacteria that cause pneumococcal pneumonia. you should not receive prevnar 13 if you've had a severe allergic reaction to the vaccine or its ingredients. if you have a weakened immune system, you may have a lower response to the vaccine. common side effects were pain, redness, or swelling at the injection site. limited arm movement, fatigue, head ache muscle or joint pain, less appetite, chills, or rash. even if you've already been vaccinated with another pneumonia vaccine,

prevnar 13 ® may help provide additional protection. get this one done. ask your healthcare professional about prevnar 13 ® today. nicole: i am nicole petallides on this record-setting day on wall street when the dow, the s&p hit an all-time high, and as the to the highest level since 2000. ended dollars up 80 at the moment. the dow jones industrial average hitting a highs including travelers, also higher. proctor and gamble, disney and home depot, all those are higher as well. outperforming the materials sector, we're looking at names like newport, those are up 2%.

and recalling brewing machines, they could overheat and inadvertently bring the users stock down 60%. more varney coming up. you park your car. as you walk away, crunch! a garbage truck backs into it. so,you call your insurance company, looking for a little support. what you get is a game of a thousand questions. was it raining? were your flashers on? was there a dog with you? by the time you hang up you're convinced the accident was your fault. then you remember; you weren't even in the car. at liberty mutual we make filing a claim as stress-free as possible. see car insurance in a whole new light. liberty mutual insurance

charles: these things happen every day, you come out stronger and meander a little bit, here is the thing, psychologically a

big milestone and meandering above the 18,000, and cheap gas, more and more, more spending money, the national average up 1 gallon, just $2.37. check this out. message from birmingham university. a case of the miami heat at the miami heat's role yesterday, two teams battle that out for 60 minutes and went into two over times and literally went to war with each other. after the game ended. helmets became weapons, all over a very hard fought the. memphis did when the game on the field, we're still waiting for injury reports. liz: stupid to take your helmet off during a demand more stupid to swing round like a weapon. these guys should be banned for a number of teams. it feels every game you will see a brawl. clearly these guys are in charge at the college level and are not in control. this is outrageous and someone could be seriously hurt.

charles: i don't want to diss the miami baseball, and you can't win anything. >> and sportsmanship right now. charles: the big tech trends in 2015. technology consultant, we are not a believer in the. >> i don't think it should be as far. $2 million buying the company. i don't think they will get the broad market share that facebook is used to because people don't want to wear a headset when they come home from work. charles: you forget where you were rendering a tropical beach or -- you forget about this.

that is why you put your helmet on. are you kidding me? >> that is a very good point. i don't think it would be too appreciative. charles: you never know what you have. charles: like being in the airport. >> there is definitely a demand for it. charles: when they integrate with computers, video games, you will be sitting with a cockpit of a one,. >> stealing her off from vision and sound. charles: everyone talks about mobile payments, no one talks about how many impact. you say could actually be the death of cash money. >> we are very close to that stage where you don't have to carry cash around. we said disney world this week enacting mobile payments if you

use google, wall or apple paid to get into disney world. this seems like a big step in the right direction for getting rid of cash which feels antiquated already and not good for security, credit cards have security issues. and -- >> last one with cash. charles: the argument is who will kill the ballot first, the applications for the federal reserve? charles: finally, the apple watch. another one of these things. i and a watch connoisseur. i don't plan on buying an apple watch until they get a little thing from star wars. when they get a hologram coming out, that is what i am buying. liz: looks like the fig newton on your wrist. don't think is attractive. >> compared the the others is that step in the right direction

but not quite there yet. i think there's a lot of enthusiasm but not a mass-market product. charles: other than being new or leading-edge? >> you are naming all the things. it is new warhead. it does some neat things, but there are a lot of devices that will review that. charles: google blast was tied to big time. that will be it for 2014. she feeling silicon valley running on ideas year? >> we are seeing that in the next year. i think the are, there will always be creative outlooks, always new innovations coming out. each year is a new challenge. charles: appreciate it. you may be seeing a driver's of alaska are real soon, sooner than you think. google is ready to test a new prototype that would revolutionize transportation. all the details right after that break.

she's still the one for you. and cialis for daily use helps you be ready anytime the moment is right. cialis is also the only daily ed tablet approved

to treat symptoms of bph, like needing to go frequently. 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, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a free 30-tablet trial.

charles: look it this shares up

$0.43. a fox blackout on dish network, battling over contract negotiations. >> tim kerri, the vice president of fox news, dishes blacked out its customers, three times, they did this with cvs for a number of hours, a 12 hour period, certainly to dish blocked out cvs customers so couldn't get cbs football games but will this turnaround? fox news, first time in two decades the fox news and fox business have been hit with a black out. charles: people are so upset. thousands and thousands of people with this. >> if i could shine in a couple weeks ago dish had the issue with turner and cnn, the argument was cnn wasn't

necessary. fox news is tremendous. people demanding to get it. charles: people on there, we channel surf, we want these people. >> hardball tactics that dish prematurely did this moved to block, is there a fight over fees, there's always a fight in any negotiation but do you prematurely block out a block out rather than customers'? that is at issue? charles: was a desperation or game of chicken that has gone too far? liz: might be a game of chicken that has gone too far. the charles: i know you are excited. this is a completed prototype of google's self driving a car and is ready to hit the road so line up right now. lauren simonetti joins us with more. >> looks like not marshmallow with weird headlights of back in may google told us about their prototypes of driving car. didn't have a steering wheel, didn't have real headlights,

everything was by a button but california's that in and the regulators said you need to have a real steering wheel and deal petals on there so this is a new prototype. they say this is ready in northern california google will test it on the road legally in the new year, early part. charles: don't know what is scarier, my 18-year-old sun on the road with that google car. >> i think we're reaching-year-old send this is better, he can text and ride at the same time, can come within 45 miles an hour. >> so scary to remove the steering wheel. do you think this will fly. they think you will put your child a grandparents in their? >> 20 years out we will have still driving cars the we might see them realistically on the road in the next five to ten years. they will miss their january 1st

deadline. they are issuing, and you are driving in a test area. >> that is what they have to figure out. how do you go about policing the singles and regulations. charles: it happened sinners than your timeframe. i think it is five years away. liz: maybe word for lindsay lohan. >> the wall street journal reported a couple days ago that google is seeking out a part in the auto industry to help them bring this technology to market sooner. charles: ultimately they said we had fatalities that would be virtually zero. 25 miles an hour. it is a little faster than that. the big story of the month. perhaps year. the stock market rally down 18,000 just in time for christmas. what is the new year going to be like? more records or more money? our 2 of stuart varney two minutes away. ♪ (holiday music is playing)

hey! i guess we're going to need a new santa ♪(the music builds to a climax.) more people are coming to audi than ever before. see why now is the best time. audi will cover your first month's payment on select models at the season of audi sales event. visit audioffers.com today.

charles: not sure if you broke

out another milestone, the dow crossing 18,000 for the first time and if you had been listening to me on the show, you make a lot of money the last several years, no it has been a wild ride but you got to take a look, your 401(k) is doing well at the very least you guys didn't dump it no matter how are in view have been. the economy not growing as fast as we wanted but the momentum. gas is cheaper. we could finally see confidence start to return to main street. we had a good confidence number today, due in part to you, hard-working americans. don't let anyone else take credit for it. our 2 of the party starts right now. ♪ charles: after the initial move to the upside markets struggled little bit but holding on to gains, 15,038. we seem to have found some support no. 53, 55, 56 seems to

be it. the good news is-should continue to go down, went down again $2.37. a down another $0.02 overnight. go pro a winner finally. the first latka period expires today. 15 million shares, 17 million shares, the founder's father seems to be half of those earlier investors available for trading a lot more in february, that stock fighting against that but let's stay on your money, bring in anthony, the market, a lot of people feel like maybe intensive milestone, mostly symbolic, a big round number that resonates, when you move sideways little bit. >> they die in euphoria and don't die from old age. this is going higher. gdp number, earnings are there, more share repurchasing in the first quarter of next year, more

dividend yield increases. and also it would be a rebound in the russell. i predict the dow will go to 18,000 and that euphoria would start to kick in on main street. i don't see it yet. >> i don't see it. i don't think it will get stopped by federal reserve. i was looking at stuff from 1929 and they popped that bubble. there was a lot of communication related to that. a rate superhigh. the federal reserve is cautious. charles: we had a crash and sajak rates up? >> they were jacking rates into the crash. i was catching up along the history of this sort of stuff. federal reserve jack rate into the crash and jack them again because they hinged the gold standard. these were all students of the fed. janet yellen had a great year this year. maybe she did on your show.

she has got an asset inflation trade going on. charles: honestly how does she tell the world gdp at 5%, unemployment is down, job growth is picking up, how does he honestly keep the ultimate drastic measures in place, what is the fear? >> 11.4%, there are gaps that will happen. charles: they go by that or is there something else they're looking at? >> they had a dual mandate, has to go by -- >> talk about the official unemployment number. and worried about housing. >> and the wealth affect. they had six used to put the policy in place. >> and we don't know when the

fed with a boomerang. >> i know remember the fed talking about income inequality. and federal reserve policy is that. >> that can bring in the federal reserve before congress all the time they got roped into idiotic conversation about income inequality. by the way, charles evans is pretty dovish, he will be a voting member next year. my question is where does the market go from here. >> the market trades higher in the beginning part of the year, and guide people towards the basis point rate hike, causing the market to slow down a little bit but the market will be stronger next year, and on this show, markets are higher than they were now. before i tell people there is a fit induced sell-off, don't sell

great stocks, ready to buy. what sectors do you like into the new year? >> these are controversial. i love the energy sector. they will resolve where energy prices are and likely trade higher than people expect. if you have vladimir putin saying $40 oil, it is for me in the 70s by this time next year, could be higher than that so the energy sector will rebound strongly. of the financials particularly if the curve is going up. the banks make money off of that curve. those other sectors we really like. i like oil. charles: it is almost a no-brainer. tonight at talked-about dogs of the doubt, exxon mobil and chevron fit that category. great value oriented names oversold, we will be around one hundred years from now and much higher prices. on the banks ought to want to ask about larger banks because citibank, bank of america, these are so opaque.

i am still nervous, wells fargo had a huge year. with huge year toward these companies and banks that are not doing a lot of derivatives trading, almost ural's school band? >> you could buy the banking edf and get that trade but what i like about bigger banks is we all know once this program they are too big to fail, balance sheets have been repaired. they will gain from the net interest margin from the rate curve acceleration and when that happens they print money, and these are still trading very low. charles: maybe they will start making loans to people off of the show. >> not any time soon. charles: north korea lost it little bit of its access to the internet. all five users are upset. there is speculation this was retaliation for the sony act, the obama administration being a little coy about its role. service has returned this morning. covert operations officer mike baker is with us. the president talked about a

proportional response which made me upset. i want disproportional response when people attack america but having said that, was this it? did we turn of the internet in north korea for a few hours? >> speculation at this point as to whether this was something the u.s. government did in response to that sony act. it would seem awful fast if that was the case. there are other scenarios including that the north korean authorities pulled the plug on their own limited access out of concern and preventative measure of a possible attack from the u.s.. charles: north korea might be some crazy paranoid country that has a handful of nukes. >> i didn't say it. that is the first time i heard that before. up problem here is sort of high level. if nothing else, if the sony

pact brings to the forefront, the problems insidersespionage and fibers to the terrorism around the world, that is a good thing because we have been a little bit slow getting to the game in terms of particularly in terms of the public sector/private sector cooperation in this field in the u.s.. charles: it all boils down to money and someone would say we have these budget battles could we have a budget that would have an extra $10 billion to fight cybersecurity, both sides of the aisle will go for that or the government will tell the private sector you got to beat up your own security? >> folks at capitol hill over the past year, increasingly worried about the threats in this realm whether we are talking about attacks against commercial infrastructure as we have seen with sony or against financial institutions or

attacks against public infrastructure in the grid system. is an interesting issue also because we have been struggling for years how to define the cider isattack, and we are looking at a first response to the sony act. tried to ask the chinese for cooperation and assistance in fat and the chinese are the number one perpetrators and cyberespionage or cyberattack. charles: interestingly downgraded to cybervandalism. i want to ask about china because apparently you they have offered to help russia through this financial hardship. what is your take on that? >> the us authorities in china are extremely pragmatic, and though one thing we tend to forget in our zeal to perhaps

find diplomatic solutions where there are none, china won't act in its own best interest. china's in its own best interests so when we talk about trying to drive a wedge between china and north korea and get china on our side in this north korean issue or we are talking about china proposing more assistance to russia to get past this economic crisis. we have to understand we are never going to be on the same sheet of music as the chinese authorities. it won't happen. we have to be more pragmatic in the way we view this and china's declaration that we will increase trade with russia is a perfect example of that. liz: do you think the white house is writing characterizing the sony act as cybervandalism? >> no. we need to understand the words do matter as the white house is keen to say and calling it cybervandalism doesn't put it in

its proper category. not that we are not doing a lot of work in this realm particular the the defensive side with the the lot of resources and time and effort in trying to defend our systems and understand what those who are not our interests in mind are doing and when mocking about the sony act that wasn't vandalism. that was a state-sponsored -- with the assistance of the chinese and state-sponsored attacks against our principles, our infrastructure, we need to be more serious about dealing with this. charles: to your original point i hope this is the original wake-up call. thanks very much, we appreciate it. all right, here is the lineup for the rest of the hour. you can own a piece of tv history, the ferrari from miami vice. liz macdonald put it on the auction block but it will cost you later this hour and the dow hit 18,000 and this is just a little more of the week left.

we could start out the year really good. where d look at 2015? we have a few picks at 12:35 and up after the break, interesting perspective, why the gop should be taking and from senator elizabeth warren. make the case next.

charles: a fresh story, let's bring in scott from chicago. we want to talk about a topic near and dear to your hard. longtime vegetarian environmentalist lawyer writes in the wall street journal about raising beef is good for the planet, something we knew all along. cows don't contribute to global warming as much as the greenies say. what do you say about that. >> for all those bleeding heart liberals that want to get insults from starbucks let's think of what goes into that cup of coffee with cream or the quarter week the dozen to the marvin because if you knew what went into and the science behind it there would be a lot more

respect for the guy in the field and joy what they do for grass and greenhouse is a positive thing, not a negative thing and if they want to take the gloves off and put an elbow grease into it they have a better appreciation for what goes on in middle america. charles: with this particular story the idea is that it would be a self-proclaimed environmentalists and the vegetarian because if you listen to these guys we shouldn't have cows, which shouldn't have sheep, all those things add to global warming, couldn't have cars either but at least you have someone from that side who acknowledged we might have been wrong in this thing. >> also makes some good points about helping to feed the world not just with grain but beef and we are able to produce the beef. one of the great things about america is the answer the call whether it is grain or beef and that is something a lot of other countries have a more difficult time with because of infrastructure problems.

what we have is a very good example of when there is a need, how great the american farmer answers that need. charles: you are one of those farmers in addition to the address. thanks a lot, buddy. not having a good day, at 7 million brewing machines in north america. the problem is they overheat and they can earn a user. what is up with the shares? >> don't want to use the brewer to brew coffee and get burned with hot liquids though they are recalling over 7 million. stock is down $137 and change, $20 off of this high that it hit in november. the analysts at steve one nicholas saying basically we believe earnings impact specifically from the recall some likely to be good material but could hurt land perception and this is what we're talking about going into the holidays. that is something notable but the big picture is they're trying to spend, they will be

launching new brewers, working on this recall and fixing the issue but after a couple of cups that is where people have noted they have gotten burned. charles: people forget about it. i don't know. should be gop take a page from elizabeth warren? that is what our next guest thinks. peter morici, explain this one. >> elizabeth warren is getting so much attention because she is tapping into something many americans feel, this economic recovery is not working for the man the wealthy are getting wealthier. statistically that is all true which separates the republicans from the democrats as how they are going to fix it. the democrats, policies may be wrong headed, they may be destructive but they are appealing at their base level. i will provide you with this bent event and get you subsidize health care and so on and so

forth. will get the edge for signing up for next year's insurance. what republicans should be coming up with is common-sense proposals aimed at growth at the middle class, much more effectively if an mitt romney was able to communicate. charles: i agree with you and i have been thinking elizabeth warren had a good shot since last year and i think her ability to simplify these things, what bothers me is when i have a conservative line about losing an election because president obama offer a lot of people obama -- i challenge them. heavy seen one of these? they are very crafty. if you cannot tell me the american dream is better than the obama phone you don't deserve the vote. >> it is well fed for the rich men and women of america. it props up verizon, make some very well, plow back what they earned, democratic candidates through contributions. that is what the banks to lend the cellphones but you are the biggest offender of all, comcast. your rates are going up every month by more than inflation and

they take that money, obama's principal fund-raiser brian roberts, the ceo will get a burger merger to -- vote for barack obama and watch your cable rates rise. that is what i would be doing if i were john boehner but he is letting elizabeth warren to to the republicans. charles: now when we think recapitalize and we think the gop instead of a quick bite like that and understanding this is endemic to -- the power structure. who do you see? it feels like rand paul has tried of view things in the last couple months and not sure it is working. >> i don't think it can come from the tea party because they don't believe in the basic message i have given you. one of the things that has happened over the last decade or so and democrats have a lot to do with it, clinton and obama the monopolization of banks. they have become ever larger and control many more deposits and don't make the kinds of loans that encourage growth. instead they do what citibank is doing right now, gambling on

commodities in asia. it is absurd. there has been an unholy alliance between the big banks and the white house and not a very good one. dodd-frank helps solidify it and they should be hitting that hard. they want to get rid of dodd-frank what they have to do is talk about the abuse of the big banks, not liberating them. charles: what we saw recently with this last vote was the strange bedfellows with respect to opposition. you had ted cruz and elizabeth warren both voicing opposition mainly for different reasons but for me what i saw was a power struggle on both sides, the embedded leaders of these, whether it was john boehner or the people on the democratic side, protecting their turf. there has got to be an outsider at least on the gop side who can do what elizabeth warren is trying to do with democrats. >> that is what elizabeth warren

is. she really is a newcomer's the way barack obama was. you need somebody to say dodd-frank is enriching the big banks, not paying interest on your money. janet yellen is giving them free credit and they are abusing that privilege. regulating the banks doesn't work. they just place some more. the answer is bust them up. bring that glass-steagall and shot big banks downsize. basically investment-banking should be stripped out of citigroup and on top of that citigroup ought to be cut in half. it is too large to be controlled, too large to fail and has to be cut in half. no reason to have banks a huge as we have now. charles: a lot of people on both sides of the aisle particularly in middle america would agree. thanks a lot, really appreciate it. you know the ferrari from miami vice? one of those iconic cars. there it is. it is up for auction on ebay but not cheap. we will tell you how much is going for.

might set you back, back after the break. dad,thank you mom for said this oftprotecting my future.you. thank you for being my hero and my dad. military families are uniquely thankful for many things, the legacy of usaa auto insurance could be one of them. if you're a current or former military member or their family, get an auto insurance quote and see why 92% of our members plan to stay for life.

charles: breaking news. sony is giving us permission to

allow screening on christmas day of the movie "the interview." that iconic ferrari is for sale on ebay. >> $1.75 million. are you kidding me? don johnson, miami vice. they made cars cool. the director said it would not look good at night during filming so they made it white. cheryl: it has all the

documentation for the show. only 16,000 miles on the odometer. i hear it is in pristine condition. >> they have to get you down in their driving it. >> 1.75 million. charles: new polls, they prove very wrong. 77% plan to give gifts this year. >> mary older people. they are more likely to give you a present or a card. millennial's frank very poorly in this survey.

they do not give christmas presents and they don't give cards. charles: lauren, you will not just sit there and speak out of this thing. >> i think the lead deals would rather donate to a cause. i have already re- gifted this year. >> what was it? >> a wine glass bottle. [laughter] charles: they would rather go to the soup kitchen.

>> why not give a card? >> i am not sure why they don't give christmas presents. >> the survey went deeper. they said they are just not into it. >> millennial's spend more money. they are more dedicated to save money for their vacation than their home. >> people do not realize that there is some kind of new paradigm. everything else is moving in the right direction. >> i really am not a millennial, but i will speak up for them.

charles: the dow is not on the cusp anymore. a little more than a week left for that year. making more money next year. you will find out next. ♪ she's still the one for you. and cialis for daily use helps you be ready anytime the moment is right. cialis is also the only daily ed tablet approved to treat symptoms of bph, like needing to go frequently. 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, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a free 30-tablet trial. if every u.s. household with here's aa computerfor you: used sleep mode when they weren't using it, like you are in a new high and you will energy lives here.

charles: we've broke out nicely. trading sideways. we really powered through the end of the hour. oil back over 100 in june. here is the great news for you. just $2.37. more money for you to spend somewhere else. gas is below $2 a gallon. no state that averages below $2 a gallon. they followed the cheapest gas in the land. same as yesterday. $1.68 in fort collins, colorado. time now for a sector report. you and i have a sector and stock that you like and one that

i don't. >> everything is going mobile. it is unstoppable. i like apple. the most successful maker of smart phones in the world. the margins are in same. you have share buybacks and dividends. charles: apple, though, we all know the story. extraordinarily undervalued. they still have that sort of

leverage out wall street. >> that is true for any company seen as a growth plate. still selling at a discount. 13.54 earnings. apple is still cheap on a relative basis. anybody who misses in this environment, we have seen this for the past 18 months. i would not say that apple is alone. >> there is a sector and a stock that you think people should be avoiding. >> absolutely. i like solar power for energy

use. we need to figure out what is happening with oil. the gop will be under pressure to favor oil. 73% decline in earnings per share. they lowered forecasts going into 2015. i would avoid solar. >> will apple the ploy that cash clout? looking at hewlett-packard. >> you make a good point. money is not burning a hole in the pocket.

they make acquisitions on a pretty regular basis. i would say prospects for more buybacks. they will make these quiet acquisitions. charles: one set that i like is the lockheed martin. what do you think? already missing the gop and the solar situation. >> could not agree more. i like lockheed martin. these guys have a 100% return. that is just an insane margin. they are big on biometrics.

and they are also big on cyber security as well as intelligence gathering and sensors and so forth. those are areas that the gop will favor. >> i see increased funding. charles: all right, michael. you are very spot on. have a great rest of the week, christmas and we will talk again soon. we have breaking news. the "wall street journal" reporting that "the interview" will be shown at limited theaters and on video on demand. no word on who is responsible for the hack. president obama promised.

one of our good guy hackers weighs in next. ♪ [ male announcer ] with stamps.com you can print real u.s. postage for all your letters and packages. i have exactly the amount of postage i need, the instant i need it. can you print only stamps? no... first class. priority mail. certified. international. and the mail man picks it up. i don't leave the shop anymore. [ male announcer ] get a 4 week trial plus $100 in extras including postage and a digital scale. go to stamps.com/tv and never go to the post office again.

♪ nicole: i have your fox business brief. the dow is up 87 at the moment. the s&p 500 also hit a record

today. some of the dow leaders include dupont, boeing. walgreens rose 16% on record prescriptions. the stock is up 2.8%. go pro. 15 million shares. coca-cola playing it tough. announcing job cuts. this is the tightest rank they will be going through. ♪

charles: north korea's internet was not out by a cyber attack yesterday. right now, they are denying responsibility. president obama was talking about community. alex, could this be it? could this be the response we are all waiting for? >> i honestly do not think so. this was not particularly sophisticated.

the thing you have to remember is north korea's connection is tenuous at best. i do not really think that this is the work of u.s. cyber command or any part of big u.s. government. i do not think that they would do something this public. charles: someone walking into a room and taking out a plug in a wall socket. i wonder what this means. proportionate. proportionate response. >> whatever we do to north korea, we also have to be willing to do to china. chinese hackers. the next time they get their hand caught in the cookie jar, you have to respond the same way we did in north korea.

we owe china trillions of dollars. what will happen is not the cyber domain. i think the economic sanction will be much more viable. i think that it will work. make it difficult for them to use the money that they have to get the message across. >> why would the u.s. want to make credit for this outage yesterday. is this really a smack down that the united states would want to take credit for? >> i agree with you.

the u.s. government wanted to be very clear. they have the ability to to do something much more significant. we think about this in terms of someone taking a country off the internet. this actually happens not infrequently. people drop anchors on underwater fiber optic cables all the time. i do not think that it is as big of a deal. charles: very good stuff. we appreciate it. talk to you again soon. shopping track saying ted billion dollars.

kathy, i guess what we are starting to feel he or, holiday shopping did start off slow, but now we are catching up. >> there is no question that there is a lot of optimism out there. what we saw all over the thanksgiving weekend was seeing retailers using those promotions to get those early dollars. they are saying heavy discounts. very heavy discounts. they are getting some gigantic discounts that could hurt bottom lines.

>> they were planned months in advance. it can account for as much as 30% for some company's annual sales. they know that it is all about the competition. they do what they can to get the customer's attention. if the promotions are really running the gamut, i think we will still see the pillows making a profit and healthy holiday games. >> i know online is taking bigger and bigger chunks. >> the mall is not dead and i do not think that it ever will die. e-commerce shopping has changed.

while malls are very different and consumers look at them different it is not going anywhere. i do not think that they are going anywhere anytime soon. charles: i am very late. i am going to have to do a lot of shopping. can i use your name? thanks a lot. really appreciate it. millions of vehicles recalled. jeff flock actually has a list of the use safest cars. imagine that after the break. ♪ i'm only in my 60's.

i've got a nice long life ahead. big plans. so when i found out medicare doesn't pay all my medical expenses, i looked at my options. then i got a medicare supplement insurance plan. [ male announcer ] if you're eligible for medicare, you may know it only covers about 80% of your part b medical expenses. the rest is up to you.

call now and find out about an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. like all standardized medicare supplement insurance plans, it helps pick up some of what medicare doesn't pay. and could save you in out-of-pocket medical costs. to me, relationships matter. i've been with my doctor for 12 years. now i know i'll be able to stick with him. [ male announcer ] with these types of plans, you'll be able to visit any doctor or hospital that accepts medicare patients. plus, there are no networks, and virtually no referrals needed. so don't wait. call now and request this free decision guide to help you better understand medicare... and which aarp medicare supplement plan might be best for you. there's a wide range to choose from. we love to travel -- and there's so much more to see. so we found a plan that can travel with us. anywhere in the country. [ male announcer ] join the millions of people

who have already enrolled in the only medicare supplement insurance plans endorsed by aarp, an organization serving the needs of people 50 and over for generations. remember, all medicare supplement insurance plans help cover what medicare doesn't pay. and could save you in out-of-pocket medical costs. call now to request your free decision guide. and learn more about the kinds of plans that will be here for you now -- and down the road. i have a lifetime of experience. so i know how important that is. charles: think about it. our very own jeff flock would find the safest cars heading into the new year. >> it is a little odd.

seventy-one vehicles compared to 39 last year. only one car for free. essentially, cars crashing and glancing below each other. since you are a big electric car fan, i thought i would do the bolt. it got a top safety pick. the midsize classification.

>> they are are still cash for clunkers. >> they may not be great sellers. charles: you have the best stuff. we will see you again soon. more varney after this. ♪ that makes our lives possible. because we do. we're exxonmobil and powering the world responsibly is our job. because boiling an egg... isn't as simple as just boiling an egg. life takes energy.

energy lives here.

>> they were routed through chinese i he addresses. terabytes of data coming back into china. the chinese knew what was going on. >> be afraid. be very afraid.

this is not going away. stay here also. i am handing it off to my man adam schapiro. >> game on. we do not need permission. the interview will be released this christmas to theaters that want to show it. the biggest hit in hollywood is on the big screen. allowing you to send encrypted text. iowa leads the nation. yes, iowa. we've got trouble. that is right. trouble with a capital t. digil