>> 2.27% for the 10-year. david: all right. [closing bell ringing] david: we'll talk about that with our panel coming up. liz: david, i know you got rid of yours, but blackberry is still with me and shares jumping. david: you still have the blackberry? i finally got a samsung, wow. bells ringing on wall street. about an hour 1/2 ago the market which was flat-lining turned significantly down of the russell managed to pull out a win though just barely. .05%. the dow jones industrial average, s&p and even the nasdaq, which had been in the green for a lot of the day did end up negative. liz: not a bad day though when you look how far we came back. let's get to what happens after the bell so much. it starts right now. liz: let's get right into today's action. what it tells us about tomorrow. we have the hodges fund eric

marshall. who says investors reluctance into getting u.s. stocks is a good thing for the u.s. bull market. we have centerstate bank's joe keating, who will tell you how to hedge overvaluation in equities. but also how he feels about equities versus treasurys. phil streible live at the cme. phil, let me get to you first. interesting trades here. not a lot of news. we didn't get the benefit of friday's jobs report. we got it friday but it is sort of old news now. >> today is more like a hangover from friday's report. seems like this was one of the slowest selloffs i have seen in quite a long time. very little volume. seems like traders were board. they -- bored. they didn't see much follow through. we kept testing all-time highs, keep getting near it. seems like we neat a catalyst to break through. will it be retail sales or data points? we'll see. david: one thing that did pop,ed

yields on treasurys. that is is up 5%, the highest since february. when do you buy into treasurys based on yield instead of getting stocks with a high dividend? >> david, i think there are two things going on with the treasury market. one, there was awful lot of geopolitical risk earlier in the year, particularly in greece and the eurozone and that is one of the things got yields down on the 10-year to 1.64 back in january. the other, there actually was a recent peak in the dollar on march 13th. the dollar is down about 5% since then. both of those things have come together to basically push treasury yields up a bit. i think we're getting close to a point within the fixed income market you might want to start putting some money to work in the longer duration treasury instruments. liz: but, joe, to be clear though, you still feel it is almost easier and better to be picking a stock that could go up and also pays a dividend that may be above the 10-year-year-old?

>> liz. no doubt about that if you're in real high quality names, i gave awe couple like microsoft or pipeline company like energy transfer partners. if you're in companies with good solid dividend payers and continue to grow the dividend overtime, that is far superior than being in a treasury instrument. my comment before, in terms of looking at fixed income market, probably at point if you need fixed income you might need to put money to work. liz: a little bit. david: eric, what about growth in the economy? we had this anemic number, almost negative in the first quarter, does that concern you at all particularly when you're talking about the retail sector? >> i think there was a lot of noise particularly in the first quarter. we saw that in the earnings season where you had a lot of crosswinds with currency and energy. also weather a real impact. i think pent up auto sales, new housing sales, those types of things important for the consumer. we're relatively constructive. we think you have to pick your

spots within the consumer space. liz: pick your spots within the consumer space. go ahead and do that for us. what do you like right now? >> it is not in the consumer space but we like u.s. concrete. they're at hodges funds, we like companies with high barriers to entry. in industries that are, seeing pricing power. this is an area they're in new york, new jersey, san francisco, dallas-ft. worth, that are metropolitan markets where it is very difficult to get into that business in those markets. we also like american eagle outfitter which is a teen retailer in the consumer space. and this is an area that has really, really been a disappointing space for all the teen retailers out there. h there. we think american eagle will emerge as one of the winners. that industry shut down a lot of capacity, shut down a lot of stores. we think they will be one of the winners that turns around here. they have a couple of dollars of cash, no debt.

they're in good position for a turnaround here. david: phil, you talked about the jobs number on friday. we still have this emergency monetary remember policy in place which is hurting a lot of the middle class in this country, particularly savers, with an economy that appears to be improving on the jobs front. is an emergency monetary policy still necessary? >> well, i don't think so. i mean, but if you look at some larger, look globally here, look at problems in the, and risks with greece now, it was all talk about the bailout here today. i think that is what will push pressure on the market going forward. if you see greece deteriorate againtart to fail again, i think the gold market, that was something we saw a big pullback and came back down with support of 1180, you might see a bid above that. gold has not held this whole year below 1200 for a period longer than two weeks. so i think that could be a cycle back up. >> joe, microsoft had some news

about the future of windows. not that it is going away, but the latest upgrade will probably be the last. you still rally like microsoft, one of the more mature high-tech companies of the late 1990s, that did so well. it has done really well the last couple days and months. i'm wondering where you see this going now? >> well, liz, your classic big dividend payers are your mature, big brand name companies. liz: yeah. >> basically they're just cash cows. that is clearly what microsoft is. the growth of microsoft will come from their movement into the cloud and into mobile. i think that is all really, really positive. i think they have both things working for them. they have got the legacy, cash cow business from office and then they have got their new initiatives which will get the growth. david: start varney is always happy when microsoft is on the grow. phil keating, phil streible, eric marshall, good stuff. thanks very much. liz: saudi arabia's new king

salman is snubbing president obama at the camp david summit this week. david: will his absence derail the white house efforts to seal a nuclear deal with iran by the deadline seven weeks from now? joining us kissinger associates vice charm, former undersecretary of state, bob hormats. timing is everything. the secretary of state was just in saudi arabia on thursday. everybody thought we had a deal. the king pulls out. why? >> it is not exactly clear. the saudis sometimes don't tell you exactly what's on their mind but i think we can guess. this would have been his first trip abroad. it was quite clear that the saudis and other gulf arabs were not going to get what they wanted to get out of camp david which was some assurance, some security guaranty, from the united states. david: security for what? that if iran invaded them we would come to saudi arabia's help. >> taking action. not exactly clear what the wording would have been. something to the effect of protecting them against iran

going forward because we have a problem with iranian supporting forces houthis in yemen, not iranian troops but iranian-supported forces. i think they're nervous what iran might do and wanted some assurance and not have his first trip lead to disappointment as opposed to success. liz: why hold back? why not tell the saudis that we have your back? at the same time the administration is striking a nuclear deal with iran and they don't want to say yeah, we'll dive bomb in if anything happens to saudi arabia but they're a decent ally, are they not? >> they're a disease, very important. liz: -- decent and important ally. liz: not give it to them? >> there are questions that we give the same assurance we've given japanese, israelis or europeans but, it is not clear. i think the other countries that are coming will push for this. the number two guy in the country, the crown prince,

naimi, who americans know very well, will be very protect i have a and clear what they want. the defense minister, son of the sing is coming. saudis will be clear they want some kind of security gainty. how it is phrased remains to be seen. how it is phrased, they want more than just words. they want something institutionalized committed to by the president and the congress. david: it wasn't just saudi arabia. four out of the six arab leaders in the gulf states decided not to send their top guy. will the senate, united states senate which will take active role in the pact, will they approve of the pact if our arab allies don't like it? >> that ace tough call. they haven't really expressed their view. they will look the iranian pack on terms it was negotiated. two of the leaders not coming for health reasons. two are coming for reasons -- david: we're looking at there, bahrain, just to give you an

example how important it is, that is where the fifth fleet is. i think two aircraft carriers and a support group. >> that is correct. we have security relations with that whole thankrange of countries along the western side of the gulf. the administration wanted them all to come, a, to get reassures. b, to demonstrate some solidarity with them. now of course you have the king of saudi arabia who is the power there, not coming. there are important saudis coming. i don't think we should underestimate their importance. david: but it was a snub. >> the fact he apparently agreed on thursday. some deliberations took place in riyadh between thursday and friday night when they started signaling they weren't coming. obviously something to it. liz: would this help the relationship that president obama had made some comment about the saud i dids need to look internally at disenfranchised younger underemployed people. >> right. liz: almost speaking as if you talking about america. we have the same problem, certainly. but our problems, thankfully up until now don't generate isis

joiners. problems with disenfranchised people in some of the middle eastern nations as they take up the isis arms. >> i think his timing was not very opportunity. liz: there you are. >> that could have been it. there were some deliberations between the meeting secretary kerry had with the king and when they started the, foreign minister called on friday apparently late. he said well the king isn't coming. they have clearly made some decision. a, largely i think on the basis they weren't going to get the tight, well-written and tight agreement that they were going to, or aiming for. they wanted that. they wanted something very clear. david: yeah. >> some kind of either treaty or mittment, not just the president saying we've got your back but some very clear american commitment. david: meanwhile israel seems to have their back. israel and saudi arabia have never been closer. in some ways closer than the u.s. and saudi arabia. >> they're sort of parallel at this point. i think the fact that the iranians with which, with whom we're having these negotiations are, in yemen, fighting in

effect, or their surrogates are fighting saudis help either. they have a truce. i think he wanted to watch what was going on there but clearly he wasn't going to get what he expected. david: strange times. >> you don't want to make your first trip abroad and come away with essentially very little, far less than you wanted. david: bob hormats, kissinger and associates. liz: thank you, bob, very much. who isn't looking for some clues as to the future of the markets? just look at the leaders from the clues. what are the leadership stocks and sectors right now? we'll tell you. david: also alibaba buying a stake in zulily slowly infiltrating our markets. how big of a threat are they to businesses here in the u.s.? can we compete with such a massive company. we'll ask overstock.com ceo and founder, patrick m byrne. >> has a deal with alibaba. david: seems favorable to it. liz: uber seems to think it is worth more than target or

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liz: an emergency landing at lax

today. you can see the plane did not have its landing gear totally deployed. skywest airlines from monterey, california, when it experienced a mechanical malfunction. it was still able to land, shaking as it hit the tarmac. 41 people on board. this is not the first incident for skywest in recent weeks. it made headlines last month when one of its jets plunged 20,000 feet in a few minutes before making a emergency landing in buffalo. david: thank god everybody is okay. when alibaba debuted it is ipo last year, its business model was set to be any kind of a threat. but it has bought a big stake in zulily, an online retailer that targets new mothers. is alibaba moving into the retail market? online retail ceo co-founder, overstock.com patrick m. byrne. good to see you, patrick. what do you think of the deal? >> david, great to see you.

i've just learned about it, a couple hours ago. i think it makes a lot of sense for them, rather than starting a brand from scratch, alibaba gets to start on zulily which is already a fast growing brand. it's a smart deal for alibaba. david: are you worried about alibaba as competitor coming into the u.s. market? >> it's a big world. it's a big pond. we're all small fish in multi-hundred billion dollar pond. it's a big pond. we're not worried but always attuned to our competition. david: you have to be attuned. we all love competition. that is the best thing for consumers, keeps competitors on their toes, there ain't that much competition in china. amazon and ebay tried to get involved in the chinese market, forget about it, they can't get in? >> it is hard to go in as their brand. we're opening a warehouse in china. it comes live and we'll be up on t-mall or tau bow. we'll be on the largest

marketplace sites with our good. they certainly play favorites in china. you have a home court advantage when you're in china, that you don't have when you're in the united states. we play by a more level trading field. but if you try to do business in china they have a home court advantage. i like competition. david: alibaba does things a little differently than you do and amazon. they don't have big warehouse. they put essentially the buyers and sellers. they're the middleman. is there any chance you might use alibaba or do some kind of a deal with alibaba, allowing them to be the middleman? >> well i guess i could say. i can comment to that. honest to gosh i have never had a conversation with alibaba. i heard all kinds of people who want me to meet jack ma. that jack ma wants to meet me. i heard over the years, we had all kinds of messages. i never actually heard from alibaba. david: her you go. we're not only coast to coast

but but we're worldwide. you would like a meeting with jack ma, right? >> jack, call collect. david: you can accept the call. all right. so, i'm just curious, they would be then potential partner. you would be able to perhaps deal with them. could you be supplier. you would have the warehouses in china which you're already beginning to explore right now. they could be the middleman between the buyer and the seller? >> that's correct. we're a step farther. we've been exploring for a year. we've been building this winter a warehouse. there is a warehouse we've been taking over, rents, building out our systems. i think it goes live next week or some we'll start having goods, sometime this month, there will be goods for sale in china from a warehouse of ours in china. and it will be actually being sold, taobao, refresh my mind, does alibaba own them? david: i will have to refer to

my produce years it owns 10 cent, it owns 10-cent, liz says. >> that is the u.s. version. chinese ebay or something. we'll go into china through that marketplace. it may end up being just the deal you described, david, our goods, our warehouse. their sales front to the chinese consumer. david: here is the sensitive question, this is the $10 billion question if you will, have you had any problems with the chinese government? a lot of people say that they're working so closely with alibaba that they would not allow any kind of competition. perhaps you're not a competitor but working alongside them. have you sensed any involvement with the government trying to prevent you from getting in the market? >> the not only have we not, i lived in china 30 years ago. i speak chinese. we bought half a billion dollars in goods during the year. we have nice relationship with the chinese government.

chinese government has treated overstock beautifully. i have gotten to know some of the officials. so far we're buying from them. let's see what happens when we start selling in our markets. david: look at the tie around patrick. last time he was on, i chided him not wearing a tie. he managed to get it around his neck even though he didn't put it up tight. patrick, we appreciate the effort. >> thank you, david, thanks liz. david: great to see you. patrick byrne, founder of overstock.com. should we fear alibaba or welcome it to our shores? send us a mess on on face back or tweet us, @fbnatb. liz: should you fear uber? is uber accelerating too fast too soon? the ride sharing app is on the verge of becoming most valuable venture backed startup in history. can it keep up a record pace? our all-star panel is up next. david: 100 billion-dollar pension mess that got messier. do illinois lawmakers have a

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start building your confident retirement today. liz: coming up with our panel, new funding could bring uber's valuation now up to $50 billion? is that justified? and fox's canceling "american idol," announcing next season, it is 15th, will be its last. it is that long overdue? we have ed yardeni thinks the april jobs number could provide enough momentum out of it is very tight and narrow trading range they have been in. do you agree and what is the play here? we bring in the panel, gary kaltbaum capital management, fox business contributor and greg zuckerman, "wall street journal" senior writer.

break through, break out or break up. what do you think the jobs number did? on friday we had a big party. the stock market did beautifully. today not so much are we out of this trading range forever? >> first all we're still in a trading range. it is very simple, 50% of the market is in bearish mode, 50% of the market is in bullish mode and fighting against each other. if we break out i don't think it will have anything to do with employment numbers or economy or earnings. would have to do with mary europe upping quantitative easing or janet yellen announcing they will not raise rates this year. that is what the markets have been working off of a long while. that is two words, easy money. liz: greg, he may be right. not a single data point cracks out through the mold growing around the markets. it is not so bad. we hit a lost records in the early part of 2015. not that we lost all of the ground but what gets us out of that? >> to me you have to look at numbers and the numbers are a bit worrisome.

ratio on s&p 500, historically the average is 14.6. so say that stocks will rise from here, you have to get comfortable with high valuations and the only way to do that is really think the fed will be loose and you know the next move will be higher rates, not lower. maybe early next year. hard to get too much worked up about stocks. liz: gary, do you look at numbers or leadership? ed is saying tech, materials, industrials, that really led the way on friday and that's a great sign? >> i disagree. look, there is just one day. there is really not a lot of great leadership in this market right now. we're a percent from the new highs. the amount of new highs in the market is less than 100. it is telling you a few soldiers are leading the way up the hill right now which is typically not good news. that said, i think we could break out but i don't think you will get much out of it. liz: if the shoulders need a ride they should call uber. a new round of funding could

value uber at $50 billion. is this valuation just too high or is it justified? greg, this is disruptive, unbelievable company that is spreading and spreading like wildfire. >> it is a great company. i've taken it. used it. big fan. it valuation. tough talk to the people in the industry. they're worried. in old days it took years to raise this money. they were raising money in june, decent. they're back for more. talk about a bubble. i don't see it in the stock market. maybe in the bond market but vc guys are getting so much money from hedge funds and mutual funds it is getting to be a little bit of concern. if you're uber, take the money but if you're a vc or mutual fund you have to be a little worried. liz: mr. kaltbaum, how do you view a 50 billion-dollar valuation for a company not making money. >> asinine, 10 and 11. liz: not making profits. they're making money. >> don't pull your punches there. >> look, they have good revenue

growth. they are losing money though. look, fedex is 49 billion. this is 50 billion. sorry, doesn't work out for me. look, this is all about what i call another area where bubbles are being made. and it is going to blow up eventually. some of these apps out there have no sales. they have got 10 billion-dollar market caps. valuations are just too far out there. liz: what happens when something blows up? it leaves a big hole. that is what fox faces as it pulls the plug on "american idol" next season. does this leave reality tv with a massive gigantic hole or is this move long overdue, gary, what do you think? >> first off, this is not a story of failure. this is a story about massive success. liz: true, true. >> but when you're dealing with tv shows there is always a shelf life. after is a years, that is a lot of years. basically time. a lot of saturation in the reality shows. i think it is just, just overdue.

i don't think it hurts fox too much because the numbers are already down. you can see shows like "empire" show up to take its place. liz: yeah, possibly, greg. you look what this show has engendered. winners and even runner-ups they have done so unbelievably well. names what do you remember? which names do you remember? >> you have to think of kelly clarkson. i'm not a huge fan much her music, personality, impressive. thumbs her nose at her record label. doesn't starve herself like some other stars. it create ad group of long-lasting stars. liz: who would have never made it, possibly. >> yeah. liz: chris daughtry and carrie underwood. who do you remember, gary. is there obscure one thaw remember? >> sanjaya. he was my favorite. howard stern and his baboyites kept votes him in. my favorite of 15 years, the best performer was adam lam earth about. a great, great performer.

still underneath the radar. liz: i think of the one who won, ruben stoddard, didn't do much. clay aiken ended up on broadway. >> jennifer hudson. liz: gigantic star, possibly one of the biggest of "american idol" stars. great to see all of you. no big hole. it will be filled with great programing. to you. david: jennifer hudson, my all-time favorite. liz: the best. david: soon big brother could be watching what you eat. one activist group is pushing for new guidelines that could make it harder to eat what you want. we have details. court ruling in illinois killing a attempt to cut pension plans the state can't afford. how will the state avoid bankruptcy? what could this mean for your retirement plans? we'll have the details coming right up. ♪

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liz: imagine building a huge multimillion-dollar business on cash because no one would give you a line of credit? the one group has done just that. best known for operating the stk steakhouse brand. it was great success story. listed on nasdaq, under ticker symbol stks. what is behind the company's success? where is it looking to expand

its brand next? joining us fox business exclusive, jonathan siegel, one group ceo. you had no line of credit. >> we offered our first venue in 2004. in 2006 we created stk. it wasn't until 2011 when we were doing 83 million we could get a line of credit from a bank. that was just $3 million. nobody would lend us any money. liz: why not? >> people are nervous for the restaurant business. they see restaurants come and go. we were revolutionary. we kind of reinvented steakhouse. we made it more female accessible, a more adaptive menu for female sensibilities. i think everybody saw that as kind of a gamble. liz: what is your cash flow now? great to hear from the start you had to cobble together a little cash. >> in 2006, in first year of operation we did 6.3 million. at end of last year, we were 140 million in revenue. what is really relevant about nine years of growth, half of our life was in the recession, and worst recession any of us

ever seen. in the recession the first thing that suffers is hospitality yet we were able to grow using our own cash flows building company. liz: people eating stake as much? >> yeah, yeah. liz: government forces saying we should eat less meat. health fanatics say, well, protein is great for you. but the other side is go all vegan. >> isn't that great. someone is always keeping conversation growing. as long as the conversation is going, we'll be relevant. people are looking organic. here in america we're corn fed mostly. in europe and rest of the world, they're mostly grass fed. there are more organic meat coming available at moment. people are definitely eating stake. liz: talk about consumer tastes and where they're going. you mentioned you make it more female accessible. i'm familiar with the palm. morton steakhouse. we have del frisco's nearby. >> when you're going to those great restaurants you're having a great meal.

when you go to stk you're having a great night out. stk is as much about the environment as the meal. every stk has a deejay not because we're a club but he will play the right music for that demographic of people. when people are engaged with music, they become more socialable. as they become more socialable the vibe increases. two things happen. people eat more and drink fast and eat more. liz: you're in miami, you're in vegas, you're in london. you're all over. you are downtown. >> we do hospitality there. today is a great day, not only did we ring the bell but first day we opened in to the public in milan in italy. liz: you're global. >> we're global. as of today you can go to second stk in milan. liz: it is wonderful to know you can start with nothing and build something. >> the american dream. liz: it is. >> thank you so much. liz: perhaps the british one too. jonathan siegel, one group ceo. but had to do it in the usa.

david: what a great success story. liz: isn't that great? david: you will not like the next report, speaking of meat, health and environmental activists want the government to do more to cut meat consumption. liz: maybe vegans would like the administration to push for greater consumption of vegetables and. we go to peter barnes in washington, d.c. with more. there is petition, peter? peter can you hear us? >> david and liz, the meat market in washington, d.c., because a group of nutrition its teamed up with a group of environmentalists, to lobby about the federal government to recommend that we eat less of this in our diets. eat less meat, particularly red meet. not just for health reasons but also for environmental reasons. this alliance argues that it is better for the environment, better for farmland to grow crops and plants and vegetables than it is to raise livestock.

now this group is actually formed a campaign called, my plate, my planet. te, the science clear that eating less meet and more plants is better for our health and the health of our planet and future generations. but as you can imagine the meat industry is it fighting back on this. it has its own campaign, no lie, called, hands off our hot dogs. which argues, quote, the preponderance of evidence affirms the healthful role lean meat and poultry and including red and processed meats play in dietary patterns. you can imagine most of the customers come in here to buy meat and they kind of agree. >> have a steak maybe once a week or something like that. i eat a lot more chicken and pork. i would say the environmental effect much raising those animals as well is probably not the best thing in the world. yeah, i don't see harm in it. as long as you kind of stay

healthy, and exercise, he eat vanningables whenever you can. >> now the federal government will make a ruling in this debate when it releases its official federal dietary guidelines later this year. i doen't want to give away where i might stand in this debate, zack, what have you got for me, man? ah, a rib-eye. you know what? that goes great with asparagus. david and liz? david: there you go. you can have both. liz: peter barnes. david: i don't think the anti-meat crowd will ever be happy. thank you very much, peter barnes. in illinois the high court tossing out the state's pension law designed to fix the nation's worst public funded pension system but is that setting the state up for bankruptcy? we'll there be ripples in other states? we investigate coming up. liz: there may be strict water restrictions right now but doesn't seem to affect the rich and famous. look at their lawns, covered in

green. details next. david: are self-driving cars really accident-proof? we have evidence they are not. you don't want to miss this, coming up. when a moment spontaneously turns romantic, why pause to take a pill? and why stop what you're doing to find a bathroom?

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liz: i knew it, i knew it. it is early stage but self-driving cars may not be as

safe as originally thought. a handful of autonomous vehicles have been in accidents during just the test runs in california. four of about 50 self-driving vehicles have been in fender-benders including three google cars and one delphi automotive vehicle. half the accidents took place while the cars were driving. for the other two, humans, we need to fully disclose, humans were behind the wheel and had taken control, david. david: liz, illinois supreme court rejected an attempt by the state to cut back pension funds underfunded by billions of dollars. the question, how can the state avoid bankruptcy right now with all of these costs? with us steve malanga, senior fellow at the manhattan institute. dan prof, chicago radio talk show host in chicago. dan, you're right in the belly of the beast so to speak. talk about first what the court rejected. it was a bipartisan plan to try to lower the pension costs that

are causing an enormous deficit, an enorm must amount of the deficit -- enormous amount of the deficit. it included erasing 3% compounded annual cost of living hike, delay of younger workers past 45 or younger which is extraordinary, ability to transition to 401(k) style plans. these are reasonable plans. how can the state live without them? >> you're exactly right in terms of their reasonableness. this was passed two years ago signed by democratic governor pat quinn. this is baby step on the journey of $200 billion because right now the state of illinois has $214 billion in debt and 30 billion-dollars in assets. we need to completely rethink how we do public sector pensions in illinois. otherwise we'll not be able to pay for anything else, k-12, education, infrastructure, medicaid for poor people and pregnant women.

david: to cut those costs that are cutting right into the heart of the budget, you're going bankrupt, it is as simple as that? >> well the problem is, the federal bankruptcy code does not provide for states to go bankrupt. what is actually going to happen, this was telegraphed in the illinois state supreme court opinion, why don't you raise taxes? slash and burn social services and other state spending? the problem is, with numbers i just described you can't get there. you can't make the numbers work. so what is going to have to happen is constitutional amendment to amend the illinois constitution the provision that allowed for the supreme court to overturn the legislation in question. and or, substantial tax increases, substantial service cuts, or the public sector workers deciding they want to be part after solution that protects their pensions long term. guess what, we saw it happen in detroit, hasn't happened at state level but it could, as we saw happen in detroit, if the public sector unions are not part of a solution, everybody

take as haircut, their workers included. david: steve, i understand every state is unique, illinois particularly so, but this has to reverberate through other states, doesn't it? >> illinois is one of three states that has a constitutional amendment that says you can't change pension benefits, can never diminish them, even for work that workers haven't done yet. in the private sector what the federal courts always ruled you have got, the benefits you earned so far are yours. if your employer comes in tomorrow, we have to decrease our contributions going forward, for work you haven't done that is perfectly fine. this law basically says, that if a legislature make as mistake and we know legislatures make mistakes, if they write a bad law, a bad rule, they find out it is more expensive than they thought, you can't change it for any of the current workforce for decades until they basically retire. david: dan, the biggest mistake, it was a premeditated mistake, they knew what they were doing, all the politicians in the past

made promises they knew they couldn't keep, right. >> that is precisely right, precisely right. republicans and democrats for four decades. you don't run up a $214 billion bill overnight. it takes bipartisan cooperation, the buzzword that politicians love. we had bipartisan cooperation in illinois and as steve said, worst funded pension system. it is not just unfinancial, it is immoral. pat quinn, outgoing governor of illinois. he served in state government for 20 years. he paid $200,000 in the state pension system. if he lives to average life expectancy he will get $3.5 million back for the 200,000 he put in. that is immoral. david: illinois is unique. you have examples all over the country. >> estimated 2 to $3 trillion in unfunded pension liabilities around the country. some states are in good shape, but other states, new jersey, california -- and by the way. it is not just the state.

it is their municipality. chicago, 35% funded. that is the 65% unfunded pensions. david: steve malanga, dan proft, radio talk show host, am-560. thank you very much. >> thank you, david. liz: from illinois to california, even as california suffers through its worst drought in history some celebrities appear to be guzzling up more than enough water to keep their yards fresh and green of the stay tuned to find out who seems to be dodging the emergency water restrictions. governor jeb bush gives his first interview in months. up next we give you a sneak preview what he had to say about president george w. bush's decision to invade iraq. >> hi, everybody, i'm gerri willis. coming up on my show at the top of the hour, a massachusetts obama care exchange under federal investigation. charges of fraud, a cover-up and over a billion dollars down the drain. that is just one of the big stories coming up on "the willis report" in just a few minutes.

the real question that needs to be asked is "what is it that we can do that is impactful?" what the cloud enables is computing to empower cancer researchers. it used to take two weeks to sequence and analyze a genome; with the microsoft cloud we can analyze 100 per day. whatever i can do to help compute a cure for cancer, that's what i'd like to do.

gerri: liz: you know the saying the grass is always greener on the other side, in california it might be. while the state suffers through a major drought, some celebrity lawns are curiously perfectly watered and man cured. -- manicured. take for instance, j-lo. , jennifer lopez's california home with the luscious green garden. kim kardashian and kanye west, a

oasis in otherwise bare landscape. cher's home is impressive although the marine layer helps. i'm not saying my mom is cheating the system but i snapped this photo of her lawn and she says, i do pour bottled water on the roses. okay, mom. that is my mom's -- david: fantastic. liz: i'm not outing my mom. i'm just saying. mom. david: wow, blood is not always thicker than water. governor jeb bush sitting down with fox news's megyn kelly for his first national tv interview in more than a couple months. liz: the interview is set to air this evening. bush discusses challenges amazing our country and -- phasing our country and blake berman is live with the details. >> liz, david, jeb bush did not distance himself from his brother george w., on iraq in the interview. if i'm trying to find big spaces between me and my brother this might not be one of those.

bush sat down with megyn kelly over the weekend and says he would have authorized invasion of iraq. >> on the subject of iraq. >> yeah. >> very controversial, knowing what we know now, would you have authorized inslayings? >> i would have. so would hillary clinton to remind everybody. and everybody confronted with intelligence they got. >> you don't think it was mistake? >> in retrospect, intelligence everybody saw, the world saw, not just the united states was faulty. >> bush went on to acknowledge that mistakes were made in iraq, citing lack of security for the iraqi people after the invasion. he said his brother feels those mistakes were made as well. moments ago the democratic national committee within a last few minutes here released a video about jeb bush's answers about iraq. it splices together, we just got finished watching it, clips of george w. bush and jeb bush's comments from megyn's interview. that video, liz and david is called, "don't get fooled"

again. watch the rest of the interview on "the kelly file" tonight on fox news, 9:00 eastern time. david: they don't waste time. blake burman, thank you very much. liz: thank you for joining us. we'll be back here tomorrow. for now "the willis report" is next. ♪ gerri: hello, everyone, i'm gerri willis and "the willis report," the show where consumers are our business. the nfl set to punish one of it is biggest stars. will tom brady be suspended for cheating? the latest mess in the rollout of obamacare, a state health exchange under federal investigation. we'll have latest details. self-driving cars are supposed to make our roads safer, but a new report says they're get nag fender-benders at much higher rate than regular cars. we'll investigate what is going on. don't lose money on your savings. we have a list of checking accounts with surprisingly high interest rates. all that and more coming up on