larry thomas, the soup nazi. it is a three hour show, ashley webster was here for all of it. ashley: very privileged to. stuart: i mean it. >> allies chopped liver? stuart: neil cavuto, it is your. neil: thank you very much. we are going live to the white house whether they're going to tell us what happened and why a day after we found out the chinese might have been behind the biggest hack attack in human history. more than 4 million federal workers's records were compromised but a couple hours ago we learned this could be connected to the anthem attacks and other attacks. it is spreading. we will talk to howard schmidt about this as well as henry kissinger. in the meantime the fear is this

grows and grows as the chinese were unofficially ignoring it. if they are hacking us, though they are denying it, what do we do to respond? do we just hacked back? the chinese said who are we to judge? with eric snowdon and everything else we are hardly in a position to be lecturing anyone on hacking or violating people's privacy. what do you say to that? >> thanks for having me on the program, agreed to be with you today. the interesting thing about this campaign, many of us in the industry are referring to this as panda campaigns, really disheartening for a variety of reasons. large effort going on in the federal government called continuous monitoring campaign in which they are allocating $6 billion to the notion of continuous monitoring for federal agencies and state and local, this campaign started two years ago and what we have seen

is the story of glacial speed with rollout and implementation that many orders, in the procurement cycle. neil: explain what that means that we were aware of this, we have the means to address this, getting the act together. >> execution is lacking around trying to discern these adversaries in federal networks and private networks. when we look at these initiatives, we don't think we're getting execution of implementation. $6 billion and you have only spent less than the one hundred million dollars on the program this is challenging and the speed at which we are executing is slowing down. >> we are monitoring white house reaction to this, and feeling good about the employment

report. we have to address all these questions about what happened with china and why it appears to keep happening. the chinese, i echoed at the beginning, irresponsible, and scientific, trumped up allegations, without deep investigation. you have no doubt they are behind this? >> the official statements from the white house, when you look at espionage rate coming from china, it is unprecedented. they are stealing a tremendous amount of intellectual property from the private sector. we obscene indictments to that effect as well and what we have to understand is there are what i would call individual actors being recruited and protected by the chinese military and several reasons why we initiated these indictments we have heard over the last year.

neil: thanks for educating me on this stuff for trying to. now to the guy who really wrote the book on china. the coming collapse of china, warned years before anyone else that when it came to data we got from china, when it came to promises we got from china, economic commitments we got out of china, you really couldn't believe them. gordon chang is the man, the coming collapse of china is the book, you are not buying when they say this is enough. it is not us. >> is definitely the them. the great fire wall, the most sophisticated set of internet controls in the world, they know everything that crosses their boundaries. when you send data on 4 million federal employees, they know what is going on. the new york times -- neil: they say they are not the ones who did that. if it was not them who else

could it be? >> it could have been nobody else. what you have got is the situation where the chinese know what is happening because the data is crossing their borders and even if they were to set our borders i used as a conduit, for instance russians were the source of it, the chinese would still no because they see this data traffic. if you are in china and you tap one key on your keyboard and the chinese want to know about you they will be able to track you. neil: what do they want? especially when they get into 4 million federal government workers's details? >> some of these workers are in sensitive positions. they want to first of all identify who they are and then possibly turn them, then find them and talk to them out of the site of our federal employees. what you have got than is the ability to tract data by working with individuals. neil: this stuff includes security background checks that

were done so they are aware of what we look for when we look to hire government contractors and the like so that would be dangerous but the fear is that this could put an even bigger chill on relations as if it isn't chilly enough with the south china sea. how bad do you think this gets, especially back and forth who are you to judge, you have ed snowden and all his nonsense and we go back at them within minutes at the white house china is lined again. >> not only china line, governments spy on each other but they also go after cherry's, ngos, individuals, we don't do that. what they are trying to do is obtain information they can then give to for instance their corporate to compete on global markets against us and they are interested in what people say about shine and change the discourse about china. this is going to make things much worse with beijing. we have so many problems with

the south china sea and eventually -- neil: they are building facilities, there's not much we can do outside threatening the south china sea, get some ships in there, going full on this. this could build into something that. >> the commission two years ago said for instance we could impose tariffs on chinese goods equal to the losses of intellectual property we set for each year and lisa for somewhere about 300 to $400 billion loss to the intellectual property, 90% of that goes to china. neil: they say be careful how fast you go because we own a lot of your debt, we might take the money out. >> they can't because our debt is denominated in our own currency, has six maturities, the chinese can wait and they want to hold our debt because it is better than the other currencies they are holding. neil: taken threaten and we kowtow to that. you say we shouldn't be.

>> we shouldn't be because right now our holdings, the best thing they got in their portfolio. they are losing money on their euros and the rest of it so for us that is a source of power. and their trade surplus against us was $343 billion last year. that is -- neil: do you ever go back to china? >> i do. neil: do you look over your shoulder? >> and careful. neil: gordon chang literally wrote the book on china. we are speaking to the former cyber czar in the next hour for a sense how big a deal this is and a chance to respond. how the white house will take this in because this has escalated to some pretty bad stuff. we will keep you posted on that. bosh ernest will address this and all programs coming up, this latest attack, scores of other attacks, health-care companies, the defense establishment. if you put them all together and

link the mall to the same country we are talking tens of millions but it is too early to say that. in the meantime i want to go to tom donahue with the chamber of commerce, the ceo, this might not show it but it is across the street from the white house so literally walk across the street, but it might as well have been a chasm of an ocean when the two sides didn't get along so i need an update our relations are between you and the white house and the folks in the white house, how are you getting along these days? >> as always we are getting along very well with the people work in the white house and particularly well now vuillard all working together on the trade deals, tpa and the agreement being negotiated in the pacific rim and the one we have to get to very quickly in

europe because we have to bring up that economy, our largest export partner but the relationships are regular, vigorous. neil: you said they were not always that way. you mention the word always. >> i said we always had a pretty decent relationship with the workers in the white house run. neil: he works in the white house. >> we are not going to get into those. the bottom line is they put some very talented people in there that are working on these issues and we see them as a great advantage to our country and we are working together on them. we have a lot of other issues we have differences on, issues around the capital markets, we use the same amount of energy to agree as we do to disagree. neil: you want this trade deal, the administration wants this

trade deal. a lot of democratic leaders do not want this trade deal. conservative republicans, tea party republicans iberia of this trade deal. an odd alliance and i am wondering even looking at the possible votes to support and give the president the authority needs, there's a good possibility we don't get it. then what? >> we are going to get it. everybody said we will never get it out of the senate. we had some obstructions' put in the way by some of the groups that don't want to see this bill pass because then we get the trade agreements which are fundamental to the economic well-being of this country. neil: some union groups disagree with you on that. they say other trade agreements have not been beneficial to them and groups like yours torpedo their jobs and torpedo their livelihoods and torpedo their hopes a you say what? >> i wouldn't want to have them

taking care of my money. bernard: 1 once yourself taking care of the money. the argument is -- some trade deals are better it than others. >> exactly right. the ones we have coming now cover massive amounts of the world and give great advantage to the american consumer. remember this, 95% of the people american companies want to sell something to don't operate or live in or headquartered in the united states. they are all over the world and we should not give others a leg. saying they are tense again. hacking us, running the table with us and it is time to crack down, do something to send a message that enough is enough. we do a lot of business with china, a lot of members did business with china. i you worry that this explodes?

this whole thing explodes? >> we have been very involved in cybersecurity for ten years. i worry as we go forward with china, russia, in particular, the iranians and then some -- this is very important, non -- people that are not hooked up to a government. that are terrorists. neil: in china's case the government and businesses are intertwined. let me be clear. do you trust china? do you think they are hoodwinking us, fooling us just taking advantage of us? >> i think china has a fundamental need to do business with the united states. they have a fundamental need to find a way to also work with us

on the really difficult issues around the world. on the other side. neil: they are doing this. what i am asking you is when they keep doing this, these embarrassing incidents, the leader of the chamber of commerce, no amount of business is worth putting up with this nonsense. >> i believe there are four or five countries that do this. china has gone over the line. i think they are going to find a need to slow it down because they want and need a business and economic relationship with us while at the same time they are out in the islands, cyberarea and other things, trying to come at us in an espionage way or more particular the plot that is difficult for us is that they use these

systems to help their companies take advantage of american companies and other companies around the world. neil: maybe we should be as duplicitous. >> we are never going to be duplicitous. we are going to be smart. neil: always good having you. i appreciate it. tom donahue is head of the chamber of commerce across the street from the white house. you probably heard we are looking at employment data. greece still on the verge, looking dicey, to the point where the europeans are saying it is not worth it. don't let the screen door hit you on the way out.

neil: to the white house in ten minutes we will hear what appears to be an explanation of the expanded role on the part of the chinese to allegedly hack into not only 4 million federal workers and federal government applicants's files, but maybe millions more. they are linking these latest attacks to attack on anthem, the health insurer and others that involve millions more, too ready to tell but this is a bigger embarrassment and the irony as we got into this is the means, the methods and the technology to stop it and we didn't, it happened before, a has happened again on a scale that is grander and scarier than anything we have ever seen. we are keeping an eye on that when the white house, when judge ernest addresses reporters. across the globe, to greece, we got that government on the brink, a debt payment was due today but promise and hope to get a remaining debt payments that are due, four by the end of

the month, $1.7 million worth would come up in it greece promises it would make good on. the snafus the greeks are saying wait a minute, we agreed to the broad terms of paying this back but not the provisions you, the imf and other guys are putting on us. the greek prime minister is saying enough is enough and greece on the brink yet again. nicole petallides joining us because she's smart as all get out and her greek heritage and what she must be feeling. what are you hearing first and your relatives and friends telling you what is going on. nicole: i am greek and have the ability to get to high level people and the idea of the people in greece have suffered, the standard of living has dropped 40% and some of the people i have spoken with think that deal will be made, they did not want to leave the euro zone. they don't want to leave the

euro zone, they want better conditions but don't want to leave the euro zone. the deal will be made, something of a band-aid to provide liquidity to with these anxiety. both sides are very far apart. lou: when you talk to the prime minister and the this is the same drill every time. i don't know what the greek word is for the same drill but they make sacrifices, make concessions and greek voters in general, agreed to a man and woman are saying it is the same thing and we have to make more concessions, it is king after a pain stringing us all long. how long will it be worth it for them to stay in the european union, looking less and less worth it to them. nicole: the greek people want to stay in. they don't want to get out, they want the deal. what happened with cyprus in part to accommodate tried to

wheel and deal with the imf. they got fed up and told cyprus at 4:00 in the morning, you better agreed to our terms right now and that is the hair cut for the depositors. they went into every data account and took money out just -- they actually agreed because they thought was better to stay in the euro zone. as much as they suffer, they want that as well. you have women in fur coats digging through trash cans to give unemployment above 20% or 50% for the young people. i feel for all the people in greece who suffered. what about spain? if this entire austerity moves forward and when something you might see that type of thing happening. neil: that is the next scary thing. if air bnb of where to go, if greece were to go, that is the

stuff of market fears. if it escalates to that, that is the fear. it would be a correction. scott martin not quite so sure. there could be something even worse. what do you think happens if greece goes carefully? >> more of the same. everyone will move on from this. this is the fifth or sixth time we pushed greece to the brink in and we have given them this 11th-hour deal every time. i don't think that will change. your point about the peripheral economies in europe is certainly on their radar. if you look at bond yields which plummeted, italy bond yields dropped big, portuguese bond yields dropped big last year and their backup begins this year. neil: you think there's a possibility they could get scary. explain. >> more of a correction.

you can just tell greece to go to hades. it is how you'd do it. if you put capital controls or depositor cats, that is going to scare many in portugal, and screen. neil: that is the excuse for correction we have not had for some time. >> you could see many exit in from the banking system and it is a problem. they have not solved any trade balances. right across the street, the spanish banking system, it is in the german -- neil: what would be the fallout for us? >> it would not be that big because the u.s. economy is the largest in the world, adding 250,000 jobs a month of getting wage growth. those peripheral economies, at the mouth, for june, italy, greece, they don't matter in the scheme of things. neil: there is some good news to report.

in the middle of all this review are afraid this will be the stuff of the big sell-off so far it has not been. these are all worries out there. we are keeping an eye on them. the china thing, the greek thing, there is concern this cannot but so far has not. perspective is everything. column is the only thing.

. neil: welcome back, everybody. neil cavuto here. we're just getting word from walmart right now, that it is going to be raising starting wages for more than 100,000 department managers and specialists on the heels of rising the minimum pay, hourly wage for workers across all walmart establishment, pretty much in the united states. they want to extend this to mexico and elsewhere, but this would be the first sign of a company that did not only raise the minimum wage but extended it to management as it begins to tick up the ranks, and that is something that a lot of people welcome, but there are others who worry about that, that it could be very difficult for companies to stick to

especially other companies that aren't nearly big as walmart. fast food giant on this issue. andy, your issue has been whether carl's jr. if they have the wherewithal to raise wages, they can and will, shouldn't be by government edict, walmart is doing this on its own, seems to think that it can, what do you think of it? >> it's great, that's exactly how wages should go up there. should be underlying economic growth that supports competition for labor so wages go up. people like me and other executives opposed to the government mandating a minimum wage increase, the idea isn't to keep workers' wages down, the idea is to allow businesses to grow to increase wages with economic justification, so they're sustainable. like i said before, if the government could increase just wages, the soviet union would

today be the world's dominant economic power. neil: i read something of a little more cynical than you on this, obviously, when you raise a minimum wage or a worker getting $7.25 an hour, is getting $10, if you go to l.a., maybe $15 an hour, workers earn about that or less than that say what are you going to do for me? and that cycle sets in. might be a good, fine thing in a walmart case, maybe more than able to handle it. other establishments not so much, right? >> it's true, i think this increase is coming about number one because of the drop in oil prices, which is generated real growth in retail sectors particularly companies that have something people want to buy because people have more money. as you increase that, demand wages go up, and you're right people above the minimum go up as well. i don't think this is as yet a sign that minimum wage increases at the state and local levels have much of an wi

been genuine increase in retail activity and it's hitting the wage market. neil: all right, andy, thank you very much, just to bring you up to date, if you're just hearing here, walmart has gone ahead and announced it's raising wages of 100,000 managers across all of its stores. the same week it was going to make a commitment to hire better than 100,000 u.s. veterans in a little more than a month after it hiked minimum wage. see if it gets critics off their back. that is probably doubtful. in the meantime, it is doubtful if you think the china news is going to come up at a white house press conference featuring josh earnest moments from now. the read from henry kissinger about a china that again and again is throwing stuff right back in our face. "cavuto: coast-to-coast" continues. this allergy season,

will you be a sound sleeper, or a mouth breather. well, put on a breathe right strip and instantly open your nose up to 38% more than allergy medicines alone. so you can breathe and sleep. shut your mouth and sleep right. breathe right. every auto insurance policy has a number. but not every insurance company understands the life behind it. ♪ those who have served our nation have earned the very best service in return. ♪ usaa. we know what it means to serve. get an auto insurance quote and see why 92% of our members plan to stay for life.

usaa makes me feel like i'm a car buying expert in no time at all. there was no stress. it was in and out. if i buy a car through usaa, i know i'm getting a fair price.

we realized, okay, this not only could be convenient, we could save a lot of money. i was like, wow, if i could save this much, then i could actually maybe upgrade a little bit. and it was just easy. usaa, they just really make sure that you're well taken care of. usaa car buying service. powered by truecar. online and on the usaa app. . neil: all right, we're waiting to hear exactly how josh earnest is going to explain the latest widespread chinese hack attacks on the united states allegedly. the bottom line is it is fraying relations between our two countries. former secretary of state henry kissinger here to say we ought to look how important it is to maintain the relationship. everyone needs to stay calm, right? >> well, it's important to avoid a military conflict between china and the united states, and to -- we are the

two largest economies in the world. we intersect many parts of the world, and therefore, if possible, a conflict should be avoided but not by making unilateral concessions. it requires a dialogue between the two sides, in which each recognizes their responsibilities, and attempt to find a way to a solution, and i think the issue that is now on the table should permit that. neil: you know, when you arranged and got richard nixon to go to china in 1972, would you have envisioned then, secretary, the china you're seeing now? >> inconceivable. when i came to china, there were practically no automobiles in the street. there were no consumer goods.

there were no high-rise buildings, it's a totally different society. when nixon went to china, we had to bring our own ground station or we couldn't have communicated with the united states. neil: is that right? wow. >> some rudimentary system, but nothing to take care of the president of the united states. neil: or secretary of state, at the time, right? >> i was security adviser. neil: i apologize. >> then secretary of state. neil: switch gears to isis, if you don't mind sir, general petraeus all but said and told me we're losing, not that we can't eventually win, but we're not doing well. do you agree with that, that they have the upper hand? isis has the upper hand. >> the fundamental preferences, isis is about 30,000

irregulars, they are not technically trained to fight. they have only the heavy equipment that they kept from us, or from forces that we have armed. so if they can stand up to american opposition and to american air power, and that if they can find no way to defeat them, every day that they stay in the field will look to the local region and maybe into the rest of the world. that's the american inability to deal with a mortal threat that generates volunteers and that then makes subsequent prosecution of the world all the more difficult. neil: does it mean we have to have more american troops? they control a third of iraq, half of syria, smatterings of

other countries across the region. is it too late to change it? >> i don't think it's too late. we need some local forces. we cannot do it. we could do it but we should not do it entirely with the american ground forces, but some special forces should directly be available, and i also find it that we will not permit airplanes to be supported by ground observers that could pick the targets more rapidly and more efficiently. so we need -- we need a visible defeat of isis. if isis can hold territory it has never happened before, the terrorist organizations control territory and declare a kind of

a state of caliphate, they called the previous al qaeda was an explicit terrorist organization. isis is a terrorist organization. it's a murdering group of people in addition with prisoners and local populations, and it has territory that it controls, so it is a visible presence that its enemies cannot have been able to remove. neil: and it's visible here, right? there are efforts that were made this week to sort of rein in the patriot act, to you, secretary, the american freedom act, to tone it down while keeping our security up. do you think that rand paul was right to say we went too far with the patriot act? and is there an argument to be made that in the name of keeping us safe, we can throw

away our pride and that's going too far? >> impossible for me to judge whether it went too far, but i rather err on the side of going too far than not having done enough, if there is some disaster. neil: what do you think of rand paul? >> i disagree with him. neil: if you were -- if he were president of the united states, what kind of president would he be on foreign affairs? >> i try to stay out of this sort of issue, on this issue. neil: john mccain, i'll just say, it john mccain would be worried, he'd support him but he'd be worried? >> i'm worried. i disagree with him. but it's more than disagreement because this is a way of judging the nature of our danger, and i don't think that he put the issue in the way

they would feel comfortable with. neil: secretary kissinger, always good seeing you, thank you for taking the time. >> you are my friend. neil: he was in the neighborhood! [ laughter ]. lot more after, this including as the secretary was saying some response on the part of the white house what it might be on the latest chinese hacking incident, and just how far the world's two biggest powers go in a relationship that has gotten to put it mildly worse. after this. on personal income taxes. we enacted the lowest corporate tax rate since 1968. we eliminated the income tax on manufacturers altogether. with startup-ny, qualified businesses that start, expand or relocate to new york state pay no taxes for 10 years. all to grow our economy and create jobs. see how new york can give your business the opportunity to grow

at ny.gov/business you are looking at can you spot the difference? no? you can't see that? alright, let's take a look. the one on the right just used 1% less fuel than the one on the left. now, to an airline, a 1% difference could save enough fuel to power hundreds of flights around the world. hey, look at that. pyramids. so you see, two things that are exactly the same have never been more different. ge software. get connected. get insights. get optimized.

. neil: all right, this is what a surprisingly good employment report can do, it can reverse a lot of consensus thinking when a rate hike might come. bill dudley saying that rates likely will be raised this year. the prevailing view is that it might be pushed off until 2016. there was a push on the part of

the imf all but begging us to push it off until 2016. along comes this better-than-expected job data where we gave more than 280,000 jobs. unemployment rate, i normally don't focus on the dow, it's down in the face of what was a strong report because of fears that it's going to lead to rates going up sooner rather than later. these guys are like civil, they change on a dime there. you go. the justice department targeting banks for billions more again. lizzie mcdonald on that. lizzie? >> that's what's happening right now. but what we're talking about is closing out these mortgage backed security probes that have been lingering since 2008. the question is why wasn't fannie and freddie fined too? why didn't the department of justice go after fannie and freddie? they got a nonprosecution agreement in the dead of night in the middle of december from

2011 from the sec, no fines imposed in basically buying the rotten mortgage backed securities, neil. neil: why is it going on and on? at least with the banks, credit suisse, wells fargo, they've gotten 47 billion collectively from the guys, how much more, how much longer? >> how much more and how much longer is the question. i've had people at jpmorgan chase and goldman sachs joke to me they feel like the banks are a budget line item for the department of justice. and the question is does that money go toward the victims or just to the d.o.j.'s budget? fannie and freddie question is an important one. they knew, fannie and freddie knew what they were buying, disclosed annual reports they were doing credit risk. neil: why were they left out? a lot of democratic friends and all that, but it is glaring, the omission is glaring. >> it's glaring, taxpayers own nearly 80% of the both of them. in the $187 billion bailout of

fannie and freddie. the sec decides and i read through the documents they didn't want to hurt taxpayers if they fine fannie and freddie. when they fine the banks, they hurt the shareholders in the banks. there was an e-mail, watch this, the top official at the fannie and freddie regime said these guys in there, they're not close to understanding the risks of what they're buying. those are e-mails inside fannie, and so these guys knew what they were doing, it is a glaring omission they have not been deemed because of the nonprosecution agreement, the sec struck in 2011. neil: it is like a piggy bank in the meantime with all this other stuff. lizzie, thank you very much, liz mcdonald. the sophistication of the chinese and the hack attack and the allegations, they are tweeting, tweeting back to us, eric snowden ring a bell? wow. that's pretty good. you don't have to take sides here to say i think they get

this internet thing pretty well. it's so shiny. i know, mommy, but it's time to let the new kitchen get some sleep. if you want beautiful results, you know where to go - angie's list. now everyone can get highly rated service even without a membership. you can shop special offers or just tell us what you need,

and we'll help you find a local company to take care of it. angie's list is there for all your projects, big and small. pretty. come see what the new angie's list can do for you. you premium like clockwork. month after month. year after year. then one night, you hydroplane into a ditch. yeah... surprise... your insurance company tells you to pay up again. why pay for insurance if you have to pay even more for using it?

if you have liberty mutual deductible fund™, you could pay no deductible at all. sign up to immediately lower your deductible by $100. and keep lowering it $100 annually, until it's gone. then continue to earn that $100 every year. there's no limit to how much you can earn and this savings applies to every vehicle on your policy. call 1-888-438-9061 to learn more. switch to liberty mutual and you could save up to $423. call liberty mutual for a free quote today at 1-888-438-9061 see car insurance in a whole new light. liberty mutual insurance.

. neil: all right, we're beginning to wonder why this press conference is being put off. hasn't started yet on this china hack incident. reuters report coming out might have something to do with it that a lot of the hacking incidents go back to 1985! i think that was kind of technically before the internet, but anyway, back to 1985. this is deep. the data goes back this far. that means they potentially have information about retirees, they could know what they're doing about government, this obviously spreads further, wider and longer than anyone thought. go figure. in the meantime, to fifa and now concerns that that scandal spread wider than

thought, and involves ireland. need i say connell mcshane is furious. >> of course. neil: there you go. >> i lobby for these types of stories on the show anything with the irish. this is a sore spot. it still is. but yeah, fifa basically paid off the irish to keep quiet is what we learned and the quick back story. ireland playing france trying to qualify for world cup. one of the best players, he had a handball in the box, should have been a handball, wasn't called by the ref. ireland was going to sue. neil: that is bad? >> if you know soccer, you can't use hands. it's not called. ireland is so angry, they're going to sue over this because they make the world cup. fifa says we'll take care of this. $7 million payoff saying for the building of new irish stadiums as a loan if ireland qualifies for the 2014 world cup. ireland is not the best soccer

nation in the world. they don't qualify. the money is just that, money, it's another example that the story keeps on giving the way fifa operates because every day seems like something new comes out. this is the latest. they are paying off the irish. neil: sounds like bitterness on your part, italy did. be that as it may. did you get a sense, are they saying there's a long history of questionable deals, relationships here and that maybe was glaring in the case of the qatar getting the world cup and where it's 140 degrees in the shade. and if that looks suspicious, but there might be a long history of this. >> so much so, this guy jack warner, we talked about him, the other day as the guy who used the onion to defend himself, the satirical newspaper. they got this guy out. they have the alert out for him. he has threatened to unveil an avalanche of secrets. they get these guys, the american guy that everybody says looks like santa claus.

they got him, warner, and they're all flipping on each other. how high does it go? "new york times" report put it up to the number two guy. the top guy resigns. can they get to sep blatter and link it to them? who knows. one thing after another. one revelation after another at highest level. there is a chance for fifa this weekend finally to focus on soccer. the women's world cup actually starts up in canada. so i'm sure they're praying everybody is watching that, and the u.s. has a good chance to win that. neil: in the meantime with moscow or russia more generally and the future, would that not be taken back? >> no, russia 2018, qatar 2022, apparently not in the summer, at another time. they said they're going to stay to that, didn't make uch sense to give it to qatar in the first place. as of now, those are the world

cups, the plans at least. neil: but any time of year in qatar, it's going to be hot. >> right. neil: come on. that might have been the first sign. >> should have been! >> how did they get it? >> and you can't in soccer, the hands unless you're a goalie. neil: what are you doing? catch it! a lot more coming up, trying to get to the bottom of the chinese thing growing through the day. the latest concerns that china is much more involved in doing this much longer and connecting light more incidents than we thought. in fact, some say before the internet itself. go figure. our former cyber czar howard schmidt on how deep this goes?

it begins from the the second we're born.er. after all, healthier doesn't happen all by itself. it needs to be earned... every day... using wellness to keep away illness... and believing that a single life can be made better by millions of others. healthier takes somebody who can power modern health care... by connecting every single part of it. for as the world keeps on searching for healthier... we're here to make healthier happen. optum. healthier is here. . neil: all right. the issue is what did china know and when did they know it and how long were they snooping on us to find out how much more they could know? we have tar feathered the

chinese with not only being behind the latest attacks that affect four million federal workers and a whole host of military establishments, health care establishments and according to reuters, this goes back pretty much before there formally was an internet. if it's that big and that far reaching and goes back to 1985, before i was even born -- or not. it would have been big. all right, bottom line it's a mess, and that's why the white house seems to be running a little late on this press conference. but i'm told that does happen, things can run late. half hour late, that's perfectly understandable. i want to go to former bush 43 cyber czar howard schmidt what he makes of this. howard, this seems to be a little different than anything you and i talked about before. there's a fraction of the latest accusations are right. it shows a participation on the part of the chinese, the level to which we've never, ever seen, are you surprised?

>> no. once again i'm not. i feel like i'm in the middle of groundhog day, we get the same thing over and over. different agency, different company, the same basic tactics and everything else sitting around for a long time and all of a sudden they get discovered. no, not surprised at all. >> the chinese are saying this is enough and to show the sophistication with the internet, they've been e-mailing, tweeting, that we are fine ones to judge, i'm paraphrasing, eric snowden ring a bell? all this sort of stuff. where do you think this goes and how do you think it escalates? >> well, where it goes is basically that, just that, just escalating. all these governments are developing new tools to attack one another, whether it's collection of information, collection of intellectual property, information on individuals they can use against them in a time of conflict, up and including weapons systems and who has

access to them and how it happens. so that's the path we're on now. the issue is that it happens all over the place, and although china is very sloppy, very noisy and very easily identifiable, there's a lot of other people doing this at the same time. so we have to figure out a way to tamp this down because we're never going to be able to stop it from taking place. we are clearly living in a glass house, and we're throwing stones, they're throwing stones, and who's going to suffer? that's us and the businesses around the world. neil: what do you think they want? just to be very clear on the issues i made about going back to the 80s. there's data they got back from that time. federal employees' records, prospective employees' records. dating back to that time. far wider and heavier net than we thought. what are they look for? or metadata reach for anything they can get their hands on? >> for the longest time there's

a giant vacuum sucking of every piece of data they can get, oftentimes stuff they can't use. this is really interesting, this identifies family members living overseas or even relatives that are overseas. this identifies family members. this shows family disputes and divorces and everything that they can use to compromise people to get them to turn to one way to the other. it could identify military member families that they can get into, because these things aren't over like they are when we walk up, hey, i want to recruit you. they do a lot of things like that. collect information from the social media outlets on there. who has what level of security clearances? there is just a treasure trove of information that you can get easily. neil: this is obviously developing and full fruition. your days, when you were trying to deal with it back then. i would think especially when it comes to defense

establishments or anything to do with the government, i would think there were better safeguards in place to prevent that kind of snooping or data gathering. what? what happened? >> well, the thing is that we haven't changed the way we access the internet. we still use user id and passwords, even though president bush signed executive order in 2006. we still don't use encryption like we should. we still don't use patching and writing better secure software and stuff like that. so you put those three together, and it's basically the old ad badge expecting doing the same thing, expecting different results. we're not going to get it. unless we fundamental change and quickly the way we access the internet. howard, thank you very much. the former white house cyber czar. he was the first at this. we are waiting for the white house to say how big a deal this is. this is the day they were

expected to crow about the job reports, 280,000 jobs are gained. we were firing pretty much on all cylinders. of course across all sectors. that was supposed to be the subject of this, of course, until we got indication that the chinese thing ran further and deeper than we thought. so when we get more on this, of course, we'll go back to that. another thing they're waiting for in washington, this is the reading that could come any day now. the supreme court deciding whether those health care subsidies that have benefitted 7 1/2, 8 million americans who didn't have health insurance but now do have health insurance thanks to the subsidies, whether the payments that helped get that are legal or constitutional. so ask yourself this. if the supreme court rules likely monday although anything is possible, and says that you can't do it. it is unconstitutional, what happens to the subsidies? what happens to the 7 1/2, 8 million americans?

kayleigh mcenany following all of that. kayleigh, is it your sense, this is the problem that all of a sudden the subsidies go, then we've got a problem because that kayleigh is the big, big problem. they lose that, then all these people lose their insurance and the republicans have to do something to make good or prevent what the democrats are saying will be a disaster? >> it would be a tremendous problem for the obama administration, which is why it's so startling that the obama administration hasn't come up with a plan b. josh earnest was asked what's your plan at 6.4 million people lose the subsidies. neil: they have said it's republicans' fault for putting us in this compromising position, their ball. >> no, it's nancy pelosi failing to point out there's a bad problem in it. it said you can only get subsidies through state exchanges. this is obama's problem, he has to deal with it. you have to follow the law. there are rules, they have to be followed. neil: one idea that's been

pushed around. what about a 2017 deadline? in other words, everything as it, health coverage as is, 2017, deal with this then, that would obviously be a new president in the white house, i'm sure you're hoping a republican, democrats are hoping a democrat. then what? what do you make of that? >> punching, i think a 2016 extension coupled with a sort of deal. so for ins johnson proposed kicking it down the road, letting people keep subsidies because the obama administration's incompetence shouldn't be the reason 6.4 million people lose their subsidies. neil: without subsidies you don't have affordable care act, the affordable comes out of there? >> extending the subsidies, what ron johnson wants to do is repeal the employer mandate in exchange for giving the obama administration the subsidies and extension they're asking or hoping for. neil: what if the supreme court rules the subsidies are just fine? >> that's very likely to happen. neil: and it's status quo. >> status quo and we're left

with the same broken system. neil: kayleigh mcenany, thank you very much. another development, that better-than-expected jobs report today, we also told that you new york fed president said that that all but guarantees a rate hike later this year, not pushed to next year. i want you to hear from a harvard professor who says this report they're crowing about, not much worth crowing about, and if you can explain that professor quinn mills from the fine institution of harvard. first of all, i want to understand how you still have a job at harvard, and i want to you explain why you don't think this is a report that's cracked up to be what it is. explain. >> it is a good report. it's not a great report. it's consistent with the same slow growth economy that's now the new normal. it's an economy growing at about 2% a year. it employs 2% or so population a year. it doesn't provide much in the

way of productivity growth, and therefore there's not going to be thatchwage earnings growth, it's an economy that is anything but a rapidly growing, strong recovering economy. the strong recovery that's been forecasted and expected all these years. it is not that. neil: i know you look at some other numbers and the numbers of so-called alternative u6 rate professor that is the big enchilada for everybody. that's showing unemployment rate closer to 11%. not the 5.5% reported. if the fed were to raise rates based on what it sees improving trend in the jobs picture, would be that dangerous at this point? what do you think? >> it would be dangerous to the economy. there are a lot of reasons why the fed may want to hike interest rates, including the bubbles that it's creating in many of the asset classes.

but a strongly improving economy is certainly not one of them. neil: when you look at this report. part of what i understand from smart folks like you, professor, look at trend, don't jump on an number, and the administration comes back, sir, and says, well, we have been averaging steady job growth. not gangbuster growth, but steady job growth and this is undeniable and had is a long way from where we were six, seven years ago. that being the case, downing the economy is doing better to the point that we don't need the federal reserve keeping interest rates at zero as it has been to sort of prop this puppy up? >> the economy is doing better, that's true. it is not doing well enough for the american people, and that shows in all the polls. we really can't improve this economy more with fiscal and monetary policy. we are at the bankruptcy, at

the decay, whatever term you want to use of macroeconomic policy. change did not intent this fiscal and monetary policy to grow an economy. he only meant to bring it out at a great recession or great depression. if we have growth policy, we would have that. what we have is not that. neil: what it would take for a growth policy? tax cuts? what? >> sure, the essence of a growth policy is a change in the regulatory environment. it is a better set of incentives that involves tax cuts. it's cutting -- what we're doing in the united states is we're running, we have one foot on the accelerator, that's fiscal and monetary policy and one foot on the brake. that's regulatory policy and the litigation system in america and all of those kind of thing. they strap business, they make business unwilling to invest, and at the same time, we're trying to force the economy

head with macroeconomic policy. so what you've got is an economy stalled between the braking and the accelerator. we've been here for years, a silly place to be, it's not good for the american people, and it's about time our leadership understood that. neil: professor, keep that job at harvard, very good having you, i very much appreciate it. i just joke. thank you, sir, in the meantime, we have been monitoring what's going on at the white house, the press conference has begun, the white house is not jumping to conclusions to the attack, right now it's trying to keep a steady as she goes view of that. we have a lot more after this. you're driving along,

having a perfectly nice day, when out of nowhere a pick-up truck slams into your brand new car. one second it wasn't there and the next second...

boom! you've had your first accident. now you have to make your first claim. so you talk to your insurance company and... boom! you're blindsided for a second time. they won't give you enough money to replace your brand new car. don't those people know you're already shaken up? liberty mutual's new car replacement will pay for the entire value of your car plus depreciation. call and for drivers with accident forgiveness, liberty mutual won't raise your rates due to your first accident. switch to liberty mutual insurance and you could save up to $423 dollars. call liberty mutual for a free quote today at see car insurance in a whole new light. liberty mutual insurance. . neil: all right, there is a

sport i know even less about than soccer, that would be horse racing. and sure enough, that would be on the eve of the triple crown, col colin -- connell mcshane. bring me up to speed on the sports. that's a big deal, it could be the first horse since affirmed? 1978? >> 1978, before you were born. >> i was one in 1978. 13 horses have had a chance, not one able to do it, this san interesting horse from a financial standpoint which is what we're supposed to focus on here on the fox business network. the owner of the horse had this grand idea a few years ago, he said i'm going to auction the horse off, make myself a million dollars. problem was nobody really bid. wasn't much bigged. forget, it i'm going to buy it back, buys the horseback for

300 grand. that's buying low, i don't know whether he'll sell ever, that's a great investment. because of the career earnings, look at this horse and the other greats. $3.7 million in career earnings for american pharaoh. we're not sure what the horse does with the money. american pharaoh, seattle slew, not showing california chrome, 6 million. but the point is the guy wanted to get rid of the horse, and now he is cashing in bigtime. they sell advertising on everything. neil: on the horse? >> on the jockey, advertising on the pants and this guy ahmed, the owner, he's got a hat. he sold advertising on his hat. it's turning into car racing the way they're doing it, sell advertising, they bring it in on that, the prize money and the value of the horse is up there. neil: why is it so difficult to get that third win? it's a long track? >> that's what they say, i'm like you, i'm not going to pretend to be an expert either.

you have to avoid the cross allen parkway on saturday, but it's a longer track, and it's tough to train for, they say. you can test the horses on other tracks. you don't know how they'll perform in belmont. and just in general in sports, tough to do three things very well in a row. to win three in a row anywhere, especially in different circumstances where the track is longer, it's very, very difficult to do. it's a heavy favorite. a 3:5 if you're betting. heavy favorite to do it. maybe this is the year. i can't wait to see. >> i can tell. now to steve harrigan on the story of a mall that went for 100 bucks. steve, i know the retail environment can be iffy. explain, what's going on here? >> yeah, the $100 sale of the 700,000 square foot mall did get a lot of attention in florida. a little bit deceiving.

the bank wells fargo was trying to sell it for half price, about 35 million dollars, but they got zero bidders, so sold it back to themselves for $100. a very bad sign for the giant interior malls across the country. just about 1500 that estimated as many as 15% of the malls could go under within the next decade. no new once have been built since 2006, neil. neil: this particular mall, is it known for anything any, anchor stores? i know by you, they have a lot of the very, very exclusive type of shopping centers and malls. what do we know about this one? >> this one has high-end anchor stores like neiman marcus which will probably stay open even after restructuring. the lower scale malls will be hit harder over the next ten years, some say because of glut, others say there's been a change in taste. people want the walking outdoor

malls so the indoor mall with the neon lights inside, which is a lot more expensive to maintain with air conditioning and heating might be an arrow that's going to go away over the next decade. neil: steve harrigan is quite the shopper when he's not in war zones. thank you, steve, always good seeing you. could have been worse, that's all they're saying about the tornadoes that hit colorado late last night. alicia kuna there. >> this is the northern part of the state here, we're going to push back so you can take a look at one of the homes that was destroyed. the two tornadoes actually hit right in this neighborhood, which is surprising to a lot of people who live here, we're so close to the foothills of colorado, nol really expecting that many tornadoes, except now in the forecast, the national

weather service says to expect even more tornadoes, more severe storms, and we have a picture to show you here that we have up on my twitter page they took of some of the damages. the side of someone's home, you can see the bedroom basically just destroyed and hanging out the side of the home. the whole top level basically gone here. folks are shocked. i talked to one woman house sitting. how would you like to house sit at this time. she saw the twisters coming and hid into the hallway of the home because they didn't have a basement. but fortunately, neil, no one was injured. neil? neil: be safe, yourself. the season is on, right? homes are looking to be at risk of hurricane, storm surges this year. everything. joe bastardi is joining us on that. it all kicks into high gear right now.

usaa makes me feel like i'm a car buying expert in no time at all. there was no stress. it was in and out. if i buy a car through usaa, i know i'm getting a fair price. we realized, okay, this not only could be convenient, we could save a lot of money. i was like, wow, if i could save this much, then i could actually maybe upgrade a little bit. and it was just easy. usaa, they just really make sure that you're well taken care of. usaa car buying service. powered by truecar. online and on the usaa app.

. neil: all right, you've heard about the gm part defects, the ignition defect. we're getting a read from the national highway transportation safety administrators saying it's been looking into this as an internal review. maybe a lack of understanding but no intentional wrongdoing on the part of gm in the ignition switch defects. obviously, there were problems and injuries and deaths attributable to the ignition switch defaults have risen from a couple dozen to north100 now. ken feinberg told us in charge of the composition fund he sees nothing deceitful on the part of the company and does not envision the count or expense to make good on the families of victims to go prohibitively higher but there is nothing deliberate going on here, deliberate going on here, maybe just more of a lack of

understanding. whether that removes a cloud over gm is anyone's guess, but for now a reprieve in the federal government. based on a jobs report that was good, better than good, but it fueled speculation echoed by the new york fed head that we see interest rates hiked this year rather than next year. whether that would be a good or bad thing and whether everyone is feeling what they are talking about? >> i think one of the numbers that is revealing is the number of people working part-time for economic reasons that they would like to work full-time but can't find that job, and need more work in order to pay their bills. that number rose to 6.7 million from 6.6 million. you have to ask yourself about the quality of these jobs and the pay of these jobs and could be why you see the numbers better but people dont feel better. >> wages are not growing fast enough, period, there's a

malaise and trepidation among americans. it's not where it would be or should be. neil: what should it be in the face of these, even better numbers, what do you think? >> i don't think the federal reserve is going to raise until next year, i don't think they'll be stupid enough to make a move that would kill any growth that we get. neil, people are bruised and battered after the economic crisis. you had 10 million homes lost to foreclosure or thereabouts. they remember $4 a gallon in gasoline back in 08. they're afraid to step up and start spending. they don't trust the numbers, they don't trust anything, and a lot of them are not making a lot more money. neil: let's say they go ahead and raise them. all that not withstanding? >> you had a great guest yesterday from hsbc was talking about the case. i had someone on my fabulous program at 4:00, we could see a real crash in the markets.

>> a quarter point? >> if the economy isn't strong enough to withstand, this is the chain reaction, not strong enough to withstand the raise in rates, it has been so low for so long, a tiny rays, they don't have gor anywhere to go from there. you come in and do something small, it could set off a chain reaction. >> if they don't raise, if they raise because there is wage inflation, beginnings of wage inflation, if they raise because the economy is better, it's not katy bar the door, it's if they make a mistake. neil: keeping rates at 0%, isn't that the bigger threat and mistake? manufacturing their own bubble and better find a way to ease out of it? >> go ahead. >> i was going to say better find a way, that's what everybody is talking about, what is actually the way out of this? they have been too low for too long and created an equities

bubble, how do you get out of it? >> you know what? danger, bob shiller won a nobel prize, he said there hasn't been a time he can remember a study where everything was overvalued. real estate is overvalued, bonds are overvalued, stocks are overvalued. that wasn't the case in 1929. so there is nowhere to go. >> have we scared you, neil? are you terrified? >> no, no, he's a very nice man. neil: so are you guys. >> he's a lovely individual. neil: as are both of you. thank you, in the meantime. angry guys and bitter and there ought to be a movie about them. because the bitter boomers have moved to daytime. just as bitter, nasty, condescending, and yeah, charlie gasparino is the leader of that pack. you are looking at two airplane fuel gauges.

can you spot the difference? no? you can't see that? alright, let's take a look. the one on the right just used 1% less fuel than the one on the left. now, to an airline, a 1% difference could save enough fuel to power hundreds of flights around the world. hey, look at that. pyramids. so you see, two things that are exactly the same have never been more different. ge software. get connected. get insights. get optimized. new york state is reinventing by leading the way on tax cuts. we cut the rates on personal income taxes. we enacted the lowest corporate tax rate since 1968.

we eliminated the income tax on manufacturers altogether. with startup-ny, qualified businesses that start, expand or relocate to new york state pay no taxes for 10 years. all to grow our economy and create jobs. see how new york can give your business the opportunity to grow at ny.gov/business

neil: you know when they asked me the idea we want to do something with the middle. day what do you want to keep from the 8:00 p.m. show and what do you want to junk? i want to junk everything and start knew with the exception of bitter boomers. you know why? thissing united states enormous controversy even when we're having fun get very annoyed including "national review," blasting back at boomers and specifically our charlie gasparino. because it was not me. hey, boomers, look in the mirror before you bash millenials.

true enough, true enough. she will be here on monday to personally bash charlie gasparino. but those bitter boomers are all here. they're not just that bitter. they're good guys. >> i gave her some advice on twitter today. fatherly advice about, you know, instead of -- neil: shut up, let me interview the others. steve lieb is here. lizzie "wicked" macdonald. the charlie brady the guy who puts up with all of us. >> can i finish what i was saying? neil: yes, please. >> she needs some advice. >> she certainly does. neil: new one for her generation. >> here's why. they sit around and emote tell us about feelings and don't like what i said about them but they don't -- >> called you a moron. >> some of them are morons. they don't do reporting. >> charlie is so right. neil: don't feed the beast. >> when was the last time that gal broke a story you remember? >> none. >> lizzie, i'm sorry, stories

she broke from 20 years ago. neil: she is not millenial. just missed it by a year. >> i read this story in the "national review." obama is a lousy president. there is a news flash. >> neil, take the story this woman wrote. i don't know her from adam. she could have been a baby boomer, for all i knew. neil: she is wonderful writer. >> you would throw it away. because there is contradiction in terms. it proves the point about millenials. they're only statistics she has in the story is about how high unemployment rates are for millenials. how many of them are living at home and how bad they are. everything else is just a bunch of emotion. she said geriatric baby boomers made them way they are. neil: they are not all geriatric. >> they're not all geriatric. look at s.a.t. scores to compared to millenial, baby

boomers s.a.t. scores are 50, 60 points higher. they had to dumb down these. neil: that is just mean. >> they did. the story proves it. neil: millenials have a point, say what you will of their generation, the baby boomer generation will head into retirement. we'll be sucking off the system far worse. >> i agree with everything she wrote in the article. she is absolutely 100% right. saying essentially k-12 bad teachers, the college tuition for degrees you can't use in the workforce. inheriting a huge national debt, brady, keep it down. >> every generation has cost to bear. inflation was 50% higher. stock market gone nowhere. neil: we walked to school both ways uphill. >> here is my problem with her. when you read the column. neil: you're sensitive to criticism. >> when you read the column you

sate there and said i read this before 20 other places. >> in i -- when i was here age i was taking on sandy weill, all the big banks. i was actually moving the ball forward. by the way i earned the right to be a blow hard. >> did anybody -- >> no, because i wasn't. neil: lizzie wrote a book about a saint and never called anyone a moron, right, lizzie. >> the book that nobody read. >> how does this woman explain, this young woman, wouldn't grace her with woman, how does this girl -- neil: did you read her column? >> i did. neil: it was conservatively written column about system that got abused. >> since medical lineals entered workforce, production and manufacturing fallen by 50%. neil: you're a hater. charlie, you keep track of numbers. every generation has a problem with the generation that is coming up, right? >> exactly. neil: is it simple as that and

charlie is a thin-skinned little weasel? >> no, charlie is not a thin-skinned little weasel. >> here the thing make one point. neil: charlie answer, get to you. >> as i was saying before unemployment was much higher when we got out of college. stock market went nowhere for 16 years. when you got a job on wall street you would get cold calling. neil: we didn't start the fire. >> we dealt with it. worked hard. started at bottom. didn't cry. >> to expect anything more than derivative journalism kids brought up on buzzfeed. neil: i didn't think that was derivative journalism. >> i read it 15 times. same thing, different words. >> she said it 15 times. neil: criticizing government out of control. >> give me a news flash. >> who elected this government out of control? who elected obama? that was the millenials. the millenials elected them. >> they're the reasons why we have obama. neil: she criticizes obama.

>> if you look at the world through 2000, we ended no debt, et cetera. millenials entered workforce. they become mature. the economy stinks. neil: that vain is popping in your head. >> this was classic bitter boomer segment. neil: you're very bitter. like the missing beatle here. he could join us and fit right in. joe bastardi, he is bitter about something else. >> he is a boomer. neil: he is bitter and booming. look at him. he is loaded for bear. even brought the vest today, trying to look chic.dn' more after this. it really opens the passages. waiter. water. so why would you invest without checking brokercheck? check your broker with brokercheck. i take prilosec otc each morning for my frequent heartburn. because it gives me... zero heartburn! prilosec otc. the number 1 doctor-recommended frequent heartburn medicine for 9 straight years.

one pill each morning. 24 hours. zero heartburn.

>> time now for your fox business brief. this is connell mcshane back with you on "cavuto: coast to coast" as we recover from that bitter boomers segment to bring you news on yahoo! in the business brief. yahoo! shutting down its map site. who knew yahoo! had a map site. thwarts of the problem. other tools being shut down as well. yahoo! maps were popular at one point but long since they have been passed by google maps. no more yahoo! maps. in the united states yahoo! is dropping some of its other less popular features. no longer supporting yahoo! mail on some older iphones and ipads and yahoo! contacts getting rid of that as well. bottom line we hear this all the time from companies when they do things like, this is part of streamlining as we look at yahoo! share price today. more from neil on coast to coast. market down 40.

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. >> office of personnel management will begin on monday informing i information may have been compromised in this particular incident. neil: likely about hour four million people's data

compromised. josh earnest say you can't hang this all on white house. congress needs to, i quote, come out of the dark ages and join us in the twenty-first century, having a modern computer protection system. never fails. i mean, one side, other side, never ever gets done. we wonder why we have all of these problems. in middle of all this the chinese reminding us we're a source of a lot of problems. we have edward snowden and back and forth and back and forth and hacking goes on and on. there is some good news though. hurricanes. yeah, the season is underway right now. how bad will the season get to the missing beatle, the missing bitter boomer, joe bastardi of weatherbell.com what he is looking at what do you think, joseph? >> well, it will be a very interesting season in the atlantic. first of all in the pacific we have hurricane blanca heading for the baja. very powerful storm, category

two, category three, likely make landfall on the baja as perhaps category 2 or 3 hurricane. it will be important because it will lead to more moisture where the permanent ma drought was suppose to be going off in the southwest. not talking about california, but further east. you folks in west mexico, new mexico arizona will see a lot of wet weather. neil, this could be a forecasters nightmare season, overall, we've been out with this forecast since march, the total activity will be down. the problem is these storms will likely to be more intense, with storms do form, near the u.s. coastline. this is the type of season, el nino, we don't he see a lot of hurricanes. bob in 1991 was el nino storm in. alicia. kmele in 1969.

betsy in '69. big hurricanes, lower numbers relatively speaking that hit in the united states in el nino seasons. neil: so in all, if they're looking generally at a moderate to light hurricane season, how often does it pan out that way you? often remind me you need one bad one and it is not a light season. but what are you looking at? >> i'm very concerned about the season, early part of the year, we start this forecast for our clients back in march and april. we started looking at 1957 and 1958. those were el nino seasons but there were four category 4 hurricanes during those two seasons. one of them, the most outrageous example of extremity in hurricanes i've ever seen, in the month of june, i a category 4 hurricane audrey, hit southwestern louisiana and southeast texas. now a category 4 hurricane in

june that is the only one that has ever occurred. but to make landfall as a category 4 unbelievable. this year, this year is very sim la lar to the pattern in texas coming off a big drought. we're concerned about the gulf lighting up later next week. neil: joe, you're an ex-encyclopedia. not wad for a boomer. joe bastardi. no one messes with joe. no one messes with adam lashinsky. he wrote the book on apple. maybe has insight on what apple is planning next week. we're told some big things maybe not some big things after this.

neil: you know when apple has what they call a developers

conference, unlike any other company that has a powwow, this gets international attention because we never know what kind of goodies the company has coming out and coming up. "fortune" magazine editor adam lashinsky literally wrote the book on apple with the take what could be coming out of apple. adam, what do you think? >> this is great point you make, neil. this is gathering of software developers. they have wonky session this is kind of code we're releasing next six months. oh by the way we'll invite 1000 of our closest friends to tell you about mind blowing industry products we might unveil. things people expect from apple next week they will update their music service. they have one of their own. it hasn't done very well. they bought one from beats. people expect they have something really big to talk about. neil: i hope it is better than the beats speakers they had to recall. >> good point. neil: looking at apple, it can't get out of the way of its own

great press. i should fully disclose here, i'm apple shareholder. have been for many, many years. the issue they keep one upping themselves. the pressure of that you leave a very tough marker to beat. i'm wondering if there isn't going to be apple tv. maybe there might be cooler things in their software for phones and all. are they a victim of their own success. >> i give you the cup half full as i see it, neil. we've spun through this in the last five years or is some we saw them go through a period like this in 2012 and '13, in two years after steve jobs died. they really didn't have a whole lot of new things. there was a ton of criticism over that. and i think they hated the criticism. but their attitude internally was, well, we're working on some things. be patient, would you. of course nobody is patient with them. that is just the way it is. my point is they do seem to be able to weather these pretty

well but there is no doubt that they can't something from apple every year. neil: what are they thinking? >> well, my sense, and you know, the words here are important in the apple world. they have a product called apple tv. that is quasi-cable box to plug into your computer and you can stream video through it. what people hope they will have a apple television, a full-on, internet connected my view they will. but i have absolutely no idea when. they do that will be cool. interesting thing about apple, they won't do it unless they think it will be something really different than the competition doesn't have. they won't do something because sony or samsung or toshiba has already done something similar.

neil: well-put. adam, thank you very much. we shall see. adam lashinsky. >> thank you. neil: i told you when we started show it would be two hours each day unscripted. latest news. anything can happen. probably will. if it breaks we go to the newsmakers we cover it. it has been a crazy week. i think we delivered a lot of what we said we would do. in fact we highlighted some of the memorable highlights and some lowlights after this. new york state is reinventing by leading the way on tax cuts. we cut the rates on personal income taxes.

we enacted the lowest corporate tax rate since 1968. we eliminated the income tax on manufacturers altogether. with startup-ny, qualified businesses that start, expand or relocate to new york state pay no taxes for 10 years. all to grow our economy and create jobs. see how new york can give your business the opportunity to grow at ny.gov/business

neil: you know one criticism i always here about business news, it is automatically dull. your business, finances, no, no. it really bothers me because i don't think i'm the most riveting person on the planet but i hate being deemed the most dull. i will accept it to a degree. one of the things we tried to do with this show, two hours live in the middle of the day, each and every day, try to show you as we do throughout the day on fox business it need not be dull. so we go coast to coast, unscripted, two hours. anything happens.

usually does. in the middle of right to the news and newsmakers. same show, each hour, each day, all the time. take a look. breadstick sandwiches, hello. you are looking at a bull, stuck in a well. because bull stuck in a well refusing to get out could be analogous to a bull market stuck in some very controversial headlines and developments. >> joe, you're doing politics all the time. what about comedy? it is same thing really. neil: hop on air force one and never ever, ever, have to worry about a flight delay. >> i think would be great thing i know i would never stand in line realize i will have to share the airplane with a guy like neil cavuto. >> they want leaders to stand up how we make everybody better. how we live the american dream. >> i had the ability to do great things and i've had the ability to make things great. and, that is the mind-set that the country needs. >> i think selection will be

show me, don't tell me election. >> you can't win don't do it, right? you wouldn't be starting the show if you didn't think it would be success. neil: very valid point. >> every politician says the next election is the most important one, this one really is. >> we'll have to watch the debates to see who shines. because we have to have a winner. that is the main line. neil: update on that bull, stuck in a well. the bull has fallen asleep. i'm beginning to wonder whether the bull fell asleep just as my show was going on or a show of stuart varney's. top that, varney. i can confirm to you the bull is all right. they pulled the bull all right. he will be okay. true as i feared and thought and as i long suspected, the bull had indeed fallen asleep watching stuart varney's show. apparently the bull not a fan of british accents. other dirty little secret stuart is not from england, he is from

brooklyn. i think that is news to some of you. we're family here i can share that your patience and indulgence this past week at fox business where we make it about you, unscripted real time, for you all the time, taking stock of what is important just like eric bolling doing extra duty. >> thank you, neil. i did not know stuart varney was from brooklyn. neil: don't even get me started on rest of the stuff. >> i see him in the hallway. thank you very much, neil. we'll take a very close look what appears biggest breach ever of u.s. government systems. why all roads leading to china. "the intelligence report" starts right now. eric: welcome to the teleagainst report. i'm eric