earnings down 12. maria: lululemon also on the move. >> yeah, down a lot. down 11% and those more of a broken situation. i think that costco is a big one in terms of the bellwether. >> and another debate, yay. maria: another debate. see you tomorrow. "varney & company" begins now. stuart: maria, thank you so much. it's short-term, until our country gets its act together, that's donald trump defining and clarifying his muslim ban. good morning, everyone. the donald is still hogging the headlines, interviewed by barbara walters, he says he's the least bigoted guy around. you check the establishment media today, they really, really hate him. hillary clinton says this, the whole g.o.p. is just like trump. even though most leading republicans, except ted cruz, have repudiated him. we've got a new revelation in the california terror outrage. syed farook had planned another

attack years ago. is there another cell with conspirators on the loose? look at this, please. we're almost there, gas at $2.01 be with oil below $40 a barrel, we should be bebe -- be below $2 by christmas. what a wonderful news day. "varney & company" begins ♪ >> you can call it a chemistry experiment, if it goes through. dow chemical and dupont propose to merge. due month -- dupont is up 8% and dow chemical up 8%, a generation ago, a dow-dupont merger would have been headlines for a month

and now, it's a shift. an interesting story, but i'm not going to dwell on it. the dow as in industrials, little change, maybe down 20 after yesterday's big selloff. we have no clue whether the selloff is over, but we will ask the question, is it over? stocks came down because of oil yesterday, when it dropped below 40, hit a low of 36. was that the bottom? no clue. but again, we will ask. it's 37 and change this morning, this-- hold on, i think we're going to play the trumpets. ♪ >> yes, look at that, didn't you love it, boys and girls, didn't you love it, 2.01, the national average on regular. sure looks like 1.90's by christmas. in missouri the average is all the way down to $1.78. ashley: show me state, show me cheap gas. stuart: that would be a buck 50 by christmas if that goes on. let's get serious, donald trump

is not walking back what he said about muslims, but he did qualify it. roll tape. >> do you regret urban on muslims, which some people think is unamerican? >> not at all. we have to do the right things. it's short-term, let our country get its act together. >> are you a bigot? >> not at all, probably the least of anybody you've ever met, and the worst thing that's ever happened to isis, the people in my party fully understand that. stuart: meghan mccain is here, welcome back. good to see you. >> good to see you soon. stuart: he qualified his ban, strictly short-term is what he said. will you roll back some of your opposition to trump. he was nasty to your dad. are you going to roll back your dislike of the man. >> no, i'm not going to be the second person to make news on your show this week for that reason. my problem with that, other than the fact that it's unconstitutional, it's

impossible to ban every muslim from coming into the country. that means you would ban the king of jordan. donald trump has a golf course in dubai and i'm wondering if he'll shut that down. and he was trending on twitter for the wrong reasons. stuart: that's true. >> i know you don't care. i care. stuart: no, no, i do care, but i'm thinking this, he's stepped into a vacuum because we don't have a plan to deal with terror. president obama didn't give us a plan on sunday night. >> no. stuart: and donald trump, you may not like the plan, you may think it's unconstitutional, unamerican, bigoted, whatever, it's a plan. >> there are many people including on mr. o'reilly's show, saying this rhetoric helps terrorists because it feeds into terrorists think that americans hate muslims. there are people with concrete, definitive plans, senator lindsey graham, who i know isn't doing well in the polls, and my father, people are defeating isis.

i'm grinning and bearing it 14 months until president obama is out of office. stuart: hillary clinton says the other republican candidates are no different from trump. listen to this. >> some of his republican candidates are saying that his latest comments have gone too far, but the truth is, many of them have also said extreme things about muslims, their language may be more veiled than trump's, but their ideas are not so different. we are at war not with barbarous, violent murderers, but with an entire religion. stuart: she is trying to paint republicans with the trump brush. >> yeah, that's what liberals do and it's really convenient for her to say all republicans are like donald trump. like you said at the beginning of the show, there isn't one person except ted cruz that hasn't denounced what donald trump said about banning muslims.

hillary clinton should be threatened right now and running scared. her negative numbers are through the roof, especially with women which i love because it's ironic on so many different levels. she has to do things like that. it's a cheap and dirty politics, but we as americans should expect that from hillary clinton at this point. stuart: i think that hillary clinton should be questioned about islam and women. >> oh, completely. stuart: where is the women's movement on this? i mean, i've not heard anything from. ashley: a very good point, haven't heard one word. stuart: the shooter, the killer in california, the woman, she wore the veil completely. her brother-in-law didn't know what she looked like and she didn't drive. >> she also came here on a fee and say visa, one of the things we should be analyzing how people are getting in. banning muslims is not the answer, but i'm angering that the people filter in here and i think that hillary clinton is the last person that should be

handling this because she knows nothing and i have a-- i can't stand hillary clinton and have a hard time moving on on this. i know, shocked. stuart: i have a new development, two actually. the fed believed that syed farook planned an earlier an i tack years ago before the californ california outrage. and the wife, malik, she was an operative, i guess from a known terror group. congressman scott is here, the bill in congress to check visa applications more closely, that would not have stopped and kept syed farook out of the country. what are you going to do about rooting out the jihadists that are here? >> the bill that we passed, i would remind you passed 400 plus yes votes, so congress is working together to resolve these problems. it's the first step. we're going to continue to look

at each and every gap that we have, stuart, and you'll see additional legislation coming forward as well. stuart: can you give me a hint? i just need a hint because everybody is asking the same question. they're here, we know they're here and they've attacked already. they're already here. what will congress do about the ones already here? >> so, i think the key there, number one, is making sure that we continue to expand our intelligence networks. giving our law enforcement agencies and if necessary, our military the ability to track, to track these people. january time they leave our country, we need to be tracking them to find out where they may be going to. if they have come here on any type of visa, and, again, stuart, it's a matter of making sure that those men and women that are protecting us are getting the support that they need from us, and the ability to expand the intelligence network and quite honestly, instead of attack them from the white house, our law enforcement and military, we

ought to be supporting them. stuart: now, donald trump says short-term we should keep muslims out until we get our act together. will you offer any support for that point of view? >> absolutely not. this country was founded on religious freedom. the first amendment is based on religious freedom, it specifically says that we can't do that and the reason we still have a first amendment is so we have the second amendment. quite honestly we have a person in the white house that wants to take away the second amendment and a person running for president that wants to take away the first. his proposal is ridiculous and quite honestly, we need to be having serious discussions how we protect this country. stuart: one last point, president carter during the hostage crisis in the late 1970's kept out almost all iranians. anybody coming from that country, you're out. he did that in the 1970's. that's a precedent of sorts. >> but that's not a precedent based on religion of an individual.

that's a precedent based on where somebody comes from. i absolutely think that it makes sense when we have countries around the world where we know that we have terrorist networks that are trying to get into america, it makes sense that we take a much harder look at any of those people who are coming to this country or who have come to this country. and i would again remind people that, if you're a united states citizen, citizens have constitutional rights, but somebody who is in this country as a guest on a visa, those people do not have constitutional rights. so if we have any reason to believe that any of them that are here on visas are part of a terror network, they should be deported immediately. stuart: congressman scott, thank you for being with us. >> thank you, stuart. stuart: now this, the magazine-- "time" magazine's person of the year is-- . [laughter] >> cheryl casone with the news, who is it. cheryl: well, it's german chancellor angela merkel.

she's taken this year's title, merkel risked controversy by opening her nation's border to refugees. and she asked more of her country than most politicians would dare. she is the first individual woman to receive the person of the year recognition since time changed its title from man of the year back in 1999. stuart: i have a habit of interrupting. cheryl: i know, i love it. stuart: please put that picture back up again that time is using of angela merkel. it's a rotten picture. ashley: it's awful. stuart: why is that? >> and she looks like she's thrilled. cheryl: it's know the a true photograph, it's been doctored almost like it was digitally done or something, she looks heavy. she's not that heavy. stuart: sorry i interrupted. cheryl: that's okay, i love it, i love you. i'm obsessed boo -- by this story.

the man studying the mona lisa says there's an image found beneath the executive painting using reflective light technology and the earlier portrait lies hidden under the surface of course, of leonardo's most celebrated portrait whatever. a reconstruction shows a sitter looking off to the side. i think it's the same woman, but we can debate that later. and both of you, the annual victoria's secr victoria's secret fashion show was last night. and kendall jenner, and gigi was there. and they said they were flawless. get this, $2 million, it looks really comfortable. back to you. ashley: i'm sorry, the story. stuart: the story is that got 500 million views on social networks. ashley: wow. cheryl: victoria's secret.

stuart: 500 million, incredible. cheryl: we'll see what the ratings are. good stuff. there's now a custody battle over the terror couple's six-month-old daughter. later with judge napolitano, whether the suspect's family has the right to raise the baby. and san francisco terror suspects were here, so how do we find them? how do we stop them? colonel david hunt is next. ♪ i built my business with passion. but i keep it growing by making every dollar count. that's why i have the spark cash card from capital one. i earn unlimited 2% cash back on everything i buy for my studio. ♪ and that unlimited 2% cash back from spark means thousands

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>> how is this for a statistic that grabs your attention? since the paris attacks, 237 refugees have entered the u.s.: as of this week, a state is forced to accept them, we'll ask about that statistics at 10:00 this morning.

the san bernardino terror suspects, well, they were already here. they were jihadists about of they attacked. what do you do to find and stop jihadis who are already here? colonel david hunt is with me. colonel, look, we've heard from the politicians and quite frankly, i have not heard a plan to do anything about the jihadis already here. you're a military guy, what would you do about them already here? >> good morning, the american people are not energized, are not engaged. no skin in the game. will there's less than 1% of the americans fighting a war on terror for years, and we've been fighting for 14 years. my idea, you've got to have a national service, a national service, two years after high school, you serve in some capacity to the country. it could be the military, it could be teaching, it could be building roads, it could be a lot of things. we have, our nation has not been united at all.

we thought we were at 9/11 and not since world war ii and you cannot get at this-- >> what's that going to do with finding terror? what's that got to do with finding the jihadists who are already here? you take them out of high school and put them in a national service for a couple of years, that sounds like the civilian draft to me and you haven't built roads or teach-- >> and exactly like that. stuart: what do you do? >> because the police-- because the police and-- the police in this country cannot stop what happened in colorado and san bernardino, that's the problem. and that's what -- it can't be done that way. it has to be involved with the american citizenry. my idea is to get the american public involved. i don't care what it takes, we're not involved. we're involved politically listening to people making ridiculous statements trying to become the president of the united states. one idea is to have some kind of national draft to get the

people of this country moving. we've got 430 government agencies. there's not ten of them that are involved in this fight on terror and we have to have an outside the country strategy, and spent 4 to 9, 10 billion dollars a day bombing in isis and it has not worked. we're not winning this war at all and we have to get at it and one of the ideas is to get the american public involved. stuart: colonel, i do hear you. i'm not sure that a civilian draft would go get the bad guys who are already here, but i see your point. get the country involved in what is a domestic war. i got it. colonel, thanks very much for joining us, we do appreciate your time as always, sir. thank you. the new york daily news, leaving absolutely no doubt where they stand. look at this. donald trump beheading the statue of liberty. it's all about trump and muslims. we're on that, believe me, we're on it. and later this hour, ambassador

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warning in beijing. ashley, our viewers can't see it, but there's a front page picture, jumbotron, can't-- >> you thought it was bad 70's and 80's, nothing compared to this. businesses are shut down and schools are shut down. and trying to keep people off the road. stuart: it would murder the tourist business. and coverage from the new york daily news, showing a cartoon of trump beheading the statue of liberty, and then-- >> i think this is just something for liberals to share on social media to make themselves feel better about all the bigoted republicans, it's stupid, it's quick bait, it's dirty, i think that something must be wrong with

this newspaper if they're so desperate with their covers. stuart: don't make any money. ashley: they're going after trump for being so extreme, what do they do, go extreme. beheading the statue of liberty and bringing out the nazi-- the hypocrisy of the liberal left. stuart: when the trump came for the mexicans, i did not spoke out, and then he came after the muslims, i did not speak out, it was not me. >> we're all next. >> meghan, a fine performance. and marissa mayer hasn't turned yahoo! around and now the golden parachute. big for failure.

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>> we've got 30 seconds before the market opens this wednesday morning. we are expecting a very small decline for the dow industrials, it's a pretty flat opening. remember, this comes after a big drop yesterday and a general down side move that's

taken the dow about a thousand points away from its all-time high. the big deal is, raising interest rates this month, will janet yellen do it? and the price of oil tumbling before 40 a barrel. what does it do to our economy and what does it mean to the world economy. precisely 9:30. we're off and running, 23 points in the early going, 25 points in the very early going. here is the question, now we're up. okay. apropos, very apropos, here is the question, is the selloff over? shah galani and liz webster here. and shah galani, you're the guy that said we're going down 20%. is the selloff over? >> i don't think the selloff has begun. i think the markets will rally through the year end. if they do that, first quarter is the time to sell in january.

the markets, the way they act on friday, friday's big job, excuse me, the numbers are terrible, nothing going on. so many stocks are crumbling underneath. it's the big cap leadership is taking the market higher and moving the index higher, but they're stuck in neutral. they can't get any higher, they'll go down. stuart: one thing for you, you're consistent and you stayed with that for months. you've been wrong for months, but. [laughter] >> that's not fair. stuart: you are consistent and i like that. dan stechich in chicago, the selloff is not over, you say what? >> i say let's wait to see more economic data before we call that. you've got to see some disastrous numbers coming out there. i don't see them right now, it doesn't mean they won't come. friday will be a good indicator. we've got retail sales and let's see if the savings we've had from low energy prices will filter into the economy.

if they're saving no 20% drop, but i don't see any major up-tick either. stuart: we've asked the question, is the selloff over? shah galani says it's not here yet. and dan says let's wait and see for a definitive answer. stuart: how about the price of oil? $36 a barrel yesterday. that took the market down. $38 this morning and the dow is pretty much flat. dan stechich, the question we'll keep asking, was $36 a barrel the bottom? >> i would say no. they're going to make another hit for it. they've been attacking that 35 level and probably going for it. how far they get, i don't know. the move on the oil to the down side is not over. stuart: and what about gas liz: wholesale gas the lowest in years, what they're talking about. the plunge is not over and they're looking at the number of heating days that people turned heat in october and

november, off by a fifth. so they're saying the oil pits, the down charts is not over. stuart: we missed the trumpets, but we had that on the air right there. $2.01 for a national average. ♪ e. stuart: there it is. ashley: got the inventories at 10:30 today. that could be very important as well. that could put some downward pressure on. stuart: getting technical on me. ashley: no, no. stuart: at 10:30 eastern time they tell us how much oil they have in storage? >> you could say it that way [buzzer] . [laughter] >> in your neck of the woods. stuart: 1.95 in new jersey. and 1 is -- 1.94. in missouri, am i pronouncing it correctly. >> yes. stuart: missouri, it's 1.78. >> wow liz: that's really low. stuart: in the 1.90's by

christmas. dan stechich, are you going to take me on, i say 1.90 gas. >> i'm going to say, yes, it's a buck 89 near where i live. we tend to be on the high surprise. i was surprised to hear you say 1.94. you're always lower than me. this time we're lower and it's going the right way, it's going to be below. stuart: all right, everybody, cheer up! you can call this a billion dollar chemistry experiment if the deal goes through. dupont and dow chemical, they're in advanced talks to merge. why should we care, shah galani? >> i don't know that we should. this is the impetus curve and faces the justice department scrutiny. it's a merger of equals and if they do this in this segment. it's almost been financial engineering and i don't think it makes a whole lot of difference. stuart: old line industrial companies, how many of our

viewers have put money into dupont? how many rushed out over the past year and said-- >> it's about the m and a sector, and it's a bums rush out the door before they hike and costs go up. stuart: it's boring liz: the second buzzer. stuart: it's boring. ashley: we can't say boring? liz: you're not getting the buzzer, it's the boringness of it. ashley: welcome to the club. stuart: immateri a-- i'm not go move on. if it were two tech companies, that would be headlines. ashley: i think you made your point, i think you've made it. stuart: all right, okay, okay. how about this? smith & wesson, they make guns. the share price is up 125% this year. nicole petallides on the floor of the exchange, why is it down today? nicole: a little profit taking. they're coming out with profit

numbers that are a little high. they're taking money off the table. and analysts love it, 90% of the business and they have military possibilities and you have everybody running to get background checks. 7%, almost 8%, year over year growth, you've had terrorism. you've had presidential rates and gun legislation, front and center, which only gets all the people who want guns to go get them. that's why we continue to see this growth. stuart: shah, would you buy a gun stock? smith & wesson, i think is terrific in here. i think i 100% agree with nicole. the profit taking, there were a considerable amount of shorts. they beat everybody's expectations and the stock popped. it's ready to go up higher. stuart: how about lululemon, i'm not sure that this deserves the attention that it gets. it's a younger company. i don't want to be dismiss seive, but the retailer, okay. it's cut its profit forecast for the year and it's down 7, 6%, there you go. a surprising drop in profit at

costco. i discovered costco recently. ashley: watch out. stuart: a fantastic store. i love it. ashley: a bottle of ketchup. stuart: money coming in from membership fees not growing fast enough. surely costco stock, is it up or down? it's down 4%. but costco. ashley: great deal liz: i could see some rockets going around on your shopping cart there. stuart: if you go could costco, you can eat lunch as you go liz: it's like ants at a picn picnic. ashley: everybody eat. stuart: you can eat for free. ashley: the samples. stuart: part of the ownership of the company which is ardently pro president obama, i love the company. amazon, a big story, not the stock, but the story. and for the first time.

pay for only the channels you want to watch. so if you get their content coming at you, you just pay for what you want. >> this is long overdue, they're putting the whole core cutting theme and they want to cut the segment of premium pay tv and give you a menu. i think eventually the cable people are going to have to do. this is what they're leading the way. ashley: i love it, amazon is basically becoming this platform that all of those content providers can use and they're getting a slice of the action liz: and giving discounts on showtime, a big deal. stuart: why should i pay for channels i don't watch. can't i pay for what i want liz: amazon bundle. stuart: i'm not going to tell you what they are, fox business. how about netflix? the executive in charge of content say it could one day get into live sports? hold on a second, only if it created and owned the events, the event itself. >> this is fascinating.

disney started the x-games, why not? why not netflix start some of its own, netflix football league or whatever, they don't want to pay massive amounts of rights fees to air someone else's sports, it's a very bold and aggressive strategy. stuart: didn't yahoo! pay a ton of money to stream one game. ashley: millions and millions from a game out of london that no one cared about. but they scored it a success. stuart: i've not breaking news, the taliban attacked an airport in kandahar that is afghanistan. several dead, and we believe there are hostages, the significance of this, please, ashley. ashley: well, it's very important because this airport is a compound that houses the joint nato and afghan military headquarters. so, from latest reports they manage today get through the first security gates, if you like, using suicide bombers and now it's a full on gun battle. and the kandahar airport is

huge and sprawling, but ins a full-on battle going on right now and very symbolic. stuart: got it. thanks so much, ashley, more as this develops. check the big board, now we're up, approaching 17,600. we're up 17,599. donald trump says his plan to stop muslims coming to america would be short-term. ambassador john bolten coming up, discussing precisely that. later in the program, brent bozell on the media jumping all over donald trump. he'll have the full story. 11:00 brent bozell. ♪

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>> all right. wednesday morning. now we're up 51 points. why are we up 51 points? look at this, the price of oil has turned around. it's now at $38 per barrel. that's up 1 1/2%. the two are in lockstep. ashley: absolutely. stuart: they're linked together. ashley: hand in hand. stuart: oil up, stocks up. that's the rule of the moment. and then there's this, angela merkel, "time" magazine's person of the year. donald trump is not happy about it. ashley: he's saying, let me read this to you. it's kind of funny, a typical donald trump response. i told you that "time" magazine would never pick me as a person of the year. despite being the favorite. they're picking a person who is ruining germany. and mr. trump. stuart: a way with words. ashley: he certainly does. stuart: now, donald trump qualified to some degree what he said about muslims. roll that tape.

>> do you regret urban on muslims, which some people think is unamerican? >> not at all. we have to do the right things. short term. let our countries get its act together. >> are you a bigot? >> not at all. probably the least of anybody you've ever met and the worst thing that ever happened to isis. the people in my party fully understand that. stuart: all right, ambassador john bolten is here, now, mr. trump reiterated that it's strictly short term. the ban on muslims short-term until the country gets its act to go. does it make any difference to you about your stand on donald trump? >> no, i don't-- it doesn't make any difference. you look, there's an awful lot that's wrong with our immigration policy, our war against terrorism. the consideration of taking in refugee populations. there's no doubt this is a complex subject, but we're not sort of advancing the debate, i

think, by looking at the two polar alternatives, which is ban all muslims or honestly what chancellor merkel did in germany, opening up the borders to at least 200,000 refugees and some estimates put it much higher than that. what we need is a coherent debate on the subject. stuart: two points, number one, president obama in his address on sunday night didn't seem to have a plan to deal with terror in our own back yard and i don't think that donald trump maybe jumped into the vacuum. the president created that vacuum, there is no policy, there is no strategy. he jumped in. and angela merkel's "time" magazine's person of the year. donald trump says she shouldn't be person of the year. how about that, did she ruin germany? a, i don't care who time's person. year is, it's the least

consequential thing we could imagine, but i'll just exaggerate a little pour effect here. one view of a country, that's a geographical piece of territory that contains certain persons at a given time. if you don't care who the people are at a given time, then what chancellor merkel did by opening up to these refugees makes sense. she was willing to take the equivalent of 1% of the german population in syria refugees. if we translated that to the united states, it would be 3 1/4 million people. that's not my view of america. i think we're entitled to defend ourselves. i think we're entitled to screen who comes into the country, to have rigorous admission and citizen policies which only the best can pass. but that requires looking at what the problem is and the problem that i think all of us except barack obama, have

agreed on is radicals. and it's not by nominally excluding anyone who think might be muslim. stuart: don't we have a right to prioritize. 287 syrian refugees have come into america since the paris attack. one of them was a christian. that's it. one of them hcan we prioritize? >> i think that's exactly what we should be doing. i think one of the fine ironies, mr. international law, barack obama has just ignored the treaties that define what refugees are. and the treaties we agreed to in our own statute, because of he will founded person or religious beliefs if they return to their country of origin.

let's look at those at threat of elimination by isis. christians and let's look at who we bring in. it's not a criteria that if they suffer hardship, that's not what the treaty says. stuart: you could easily say this group is the victims are genoci genocide. you could say the same about christian, they're the victims of genocide, why not that. >> i don't mind if there's a religious test or a political threat. and that's what the treaty talks about, it was signed in 1951, the drafters of it knew exactly what they were talking about, they were talking about the holocaust. there was a religious test in nazi germany and they wanted to find a way to give asylum status to people like the jewish population of europe that was facing extermination.

the christians, the u zittis and others in the region, people who worked with the united states in iraq, for example, our interpreters, same in afghanistan who now face a possible death from shia militia in iraq or the taliban in afghanistan, those are the people who deserve refugee status. to your priority point, those are the people we should be letting in. stuart: mr. ambassador, john bolten. thank you, sir. i'm breaking away to show you smith & wesson hitting a new high, the gun makers. earlier this morning they were down slightly. now, new high. maybe people were watching this program. there is a custody battle over the baby of the sap bernardino killers. the baby they abandoned before going on their massacre. who takes the baby? judge napolitano is next. rld , but what if you could see more of what you wanted to know? with fidelity's new active trader pro investing platform, the information that's important to you

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>> the baby left with relatives by the jihadi couple who massacred 14 people in california last week is now the center of a custody battle. will she stay in child protective services or will she go to her aunt and uncle? who will get custody? judge napolitano is here. you've adjudicated cases like

this. >> cases like this, meaning you have to determine the custody of the child, not the cases where the parents are mass murderers. the it he is in-- the test in california in fact in the country, what's the best interest of the child, not the best interest of the government, national security, you're talking a six-month-old infant, not talking about a person who can make a choice. stuart: i could make a strong case what's best for the child is not to be in that family. that's a terror family, whether you like it or not. >> that's an interesting argument because some members of the family might be indicted for a variety of crimes, which i could go through if you want to. so, that would be not in the best interest of the child, to place the child with someone who soon will no longer be free to raise the child, but concerned with their own defense, perhaps even arrested. stuart: i would go further. why should the direct relatives of terrorist murderers take the

child of those terrorist murderers. >> oh, my dear stuart, we don't punish people because of what their relatives did and form judgment. stuart: i do. >> american law, if there's personal culpability, if they're going to be convicted. but if there's no personal culpability on the part of the relatives they may form the best environment for the child. stuart: so these relatives who allowed that child to be in a child with pipe bombs, automatic weapons and terrorists as parents, they let the child stay there with those people, and they're suitable to bring up the child. >> the relative let the child stay there? the child is the offspring of these two people, the parents are in no way able to take the child away.

is that what they do in england? >> i'm an american. >> oh, that's right. stuart: real fast, i want you to tell us about what you've got in the 11:00 hour, hillary clinton, benghazi, state department, fast, can you give me 30 seconds? it's a blockbuster. >> the defense department offered to have troops on a ground in a moment's notice in benghazi and the state department blocked the release of that e-mail from among mrs. clinton's batch. it only was released when a federal judge ordered it released. stuart: they were ready to roll to rescue the guys. >> yes, this is arguably the smoking gun. stuart: you'll do that at 11:00. stuart: thanks, defense secretary ash carter testified before the senate armed services committee on the strategy to fight the islamic state. are we listening in briefly. >> okay. story, when he says something of import, you will know. back in a moment. i have asthma...

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>> almost 10:00 eastern time here red light big stories, donald trump clarifies his ban on muslims entering america hex it would only be short-term. shows pentagon ready to step in with military force during the attack correspondents suggest there was no response from the state department. new information on the san bernardino killer syed farook plans of earlier attack as far back as 2012. meanwhile in texas first batch of syrian refugees arrive that texas wanted to keep them out. governor greg abbott joins us in this second hour of "varney & company" which starts now. >> breaking news taliban attacked an airport in kandahar afghanistan. >> siege been going on for 24 hours. the last five minutes here we

found out that afghan forces have regained control of the airport this is important, this is the stage bags for the u.s.'s military mission within afghanistan still headquarters to nato counsel from last word 57 dead including 37 civilians. major security floor has been exposed. this was near supposed to be secured by afghan gnarl forces and taliban able to smuggle in a lot of weapons so security questions asked. >> the military power, the taliban in afghanistan on this -- >> successes recently so still affected. now this, syrian refugees have arrived and are settling in texasing. joining us now is governor greg abbott. governor welcome to the program. i know that -- >> thank you stuart. >> you did not want these refugees coming into texas at this time. when you had to accept them, do you know who they are, where they're from, and exactly where

in texas they're going? >> we have been given detailed information about that, however, stuart it is very important to point out that texas is unrelenting in an ongoing effort to ensure that we keep this syrian refugees out of texas for two key reasons. one is because of the dangers they pose that has been made very, very clear by the united states house of representatives, by the fbi. by the director of national intdges that known terrorists are going to intermingle among syrian refugees an they say they don't have the ability to do the adequate vetting in by the federal government allowing these refugees into any state in the united states it poses a very serious risk of danger to our fellow americans. hence, we're gong to continue our efforts to try to keep these refugees out. texas is going to continue the litigation to try to put a halt to this. >> what do you make of this governor, 237 sear yans a

arrived in america since the tack in paris november 13th. only one of those 287 was a christian. what's with that? >> everything with the program is mind boggling let me add one thing that the bawption has done. the obama administration has granted a waiver allowing in refugees who have given material support to terrorists. that is stunning state court, that we're facing taillight consequence or aiding terrorist to come to the united states of america posing danger to all of us. >> u now, governor senator ted cruz is introducing a bill that would let states reject refugees. you're part of this. >> we crafted a part of

legislation that was announced yesterday for the very reason that you and i have been discussing today, that is as a governor, my top responsibility is to ensure the safety of our fellow texans. now, look reality is texas and our united states are very welcoming and a supporting nation. but we cannot let our charity compromise the safety of our fellow americans, and hence governors have to have the responsibility and a tool to reject refugees for which security assurances cannot be made and here they have not been made because director of national intelligence himself said that terrorists will intermingle among these refugees. >> now can i put the other side of the coin here the humanitarian side of the coin when we in america see pictures of women and children struggling across europe and struggling to get into a land of freedom like america, our heart does go out to them. surely you're affected by that point of view, aren't you governor?

>> stuart, we are. and as i had want to point out, that is both the united states and the state of texas, we support charity. but charity for some should not compromise the security of all. and when we know from national intelligence leaders that those referred gees will have intermingled among them terrorists who have already tried to get into the united states, when we know that some of the refugees who are allowed here provided aid and support to terrorist in syria, this is a different situation. and remember this, the woman who massacred 14 people in san bernardino took the very same proaflt you articulated a woman with a six month old child, and so we can't use those categories anymore to think well this is someone who is helpless, hopeless and needs help ignoring the fact that she's a jihad fist. >> governor of texas thank you so much, appreciate it.

>> thank you. >> new information on farook san bernardino terrorist investigators now say that they believe he may have been planning an attack years ago. farook may have conspired with another individual to carry out an attack in 2012. we also have new information on farook's's mother ashley what have we got on this one? >> questions asked prior to this attack and how could she not know for the home literally was used as a stockpile for pipe bomb and other weapons. from what we decide fox news reporting that fbi agents found empty gopro camera package shooting target and tools inside the car belonging to farook that is mother of syed farook. they say that it is very possible that car was used to drive to local gun rangers where we know two attackers practice their shooting prior to the

event in san bernardino. she's been added to terror watch ligs. fbi turning over every stone to find out who she is. what she knew, and you know, exactly what role she could have played in all of the this. >> put up farook's mother fir again please -- that is syed farook's mother. okay i think we put up the wrong picture that is shooter. killer's mother. latest poll from new hampshire shows donald trump at what is it now? we've got him at 32%. he's way out front there up 6 points since september. rubio 14. chris christie 9. bush 8 kasich at 7. this poll was taken before during and after the san bernardino shooting or o is it the -- more recent comments from trump? >> more reepght. after trump comments on muslims.

to pause all muslim immigration still nation all kinds of headlines. the founder of the muslim republican coalition ahmed seen here she says she no longer supports donald trump and she joins me now. why not ma'am, why you were supporting donald trump? why not now? >> he hasn't been listening to us. we would love to have him meet with muslim americans, but he's not exactly been very open. but we're hoping to reach out and make a difference. >> now, a lot of people on this program have said moderate muslims nonjihadi nonextremists who live in america should be out on the streets of america. demonstrating and saying we reject the extremeist we reject the jihadist. two people who have been trying to organize those demonstrations have appeared on this program

and not been able to must the hundreds or o thousands of people that they wanted. why is that? why can't we get america's moderate muslims ordinary, decent living people, why can't you get out on the street? >> well, we're doing our best what we can here. we can come out on streets and protest i don't know if that's going to accomplish. but we have been having demonstrations in terms of candle light vigil for victims of the paris attacks, and then lately san bernardino attacks. we're doing what we can, but we have to do much more. muslim americans need to be at the forefront of fighting the war on terror. if we're going to fight the radical ideology it has to come from muslim americans and we have peaceful teachings of islam best count narrative to the radical ideology. >> are you forgive me for asking a majority question are you intimidated. i mean, if you go out on streets you're going to get threatened by the extremists.

you become a target. do you feel intimidated in the streets? >> yeah. it's scary not just from the extremist. s it's leak there's a hostile environment outside. so you don't want to jeopardize our security. when we go out because you don't know what kind of hate crime could happen especially from muslim women it is not very safe because we have had head scarves pulled off. hate crimes committed because we're a symbol of islam. a lot of americans are fearful of muslims in islam. >> a vicious circle isn't it? terrorist attack and muslims say hey get rid of these jihadis very few people do that therefore native population says hey, whose side are you on? is that -- the enable to get thousands on the street macs things worse for you who ordinary, decent, law-abiding muslims. >> exactly. and we would --

we can have thousands, we've had thousands here at capitol hill. we've had muslims come out and large numbers we can condemn terrorism, violence in the name of islam. but i think a lot more needs to be done and involved in the political process and have republican muslims and needs to have gop reach out to muslim it is all across the united states. especially to mosque in all key electoral states they're visiting mosques why aren't republicans visiting. why aren't we reaching otovoters and conservative states and most of our islamic conservative values a line request republican party. i would leak to see more republicans reach out to muslim and not fear us. a lot of muslims fear republicans just leak republican it is fear muslims. we need to start talking to each other. and have the dying log in communication with one another to solve our national security challenges. >> fair point. ahmed thank you for joining uh-uh us please come back we're very interested.

>> sure they think. >> look at the dow industrial -- some of this gain that is a big gain some of is it dupont verged in merge. dow stock has gone up therefore the dow is up to some degree because of dupont that's not the whole story. we have oil going up now at 38.21 and dow goes up. dupont up $7 dow chemical up $5. okay. well -- >> mcdonald hitting lifetime high. >> yeah, life lifetime like that word. coffee drinking. >> are we dealing with that right now because we're up to 117 dollars per share of mcdonald's. okay what do we with got on this? >> four straight days. >> teases of doing later? >> they want us to talk about it. people are liking that actually. it is coming in. feedsback is coming in. people like it. [laughter] they should have a full english breakfast.

>> with black pudding. [laughter] dried piggings blood, fried bred, tomatoes, fried egg, bacon, fried sausage. >> this is a stuart varney kitchen table where we talk about black pudding for breakfast. >> now they're telling me to shutup. coming up, a coal country lawmaker dealing with the fallout from the paris climate summit. and headlines from capitol hill. general ash carter that would be the defense secretary ash carter testifying and pushing for more action in iraq. his comments after this.

>> chemical and dupont in talks i'm sorry, i've got breaking news for you. i want to go to ash carter he's testifying before congress, he's pushing for more u.s. military intervention in iraq, peter barnes you've been listening to this. what's he saying? >> that's right stuart another sign of increased escalation against the fight against iraq,

and now willing to order attack helicopters to iraq in order to defeat isis. here's what he said. >> united states is prepared it to assist the iraqi army with additional unique capability to help them finish the job. including attack helicopters and accompanying advisors and circumstances deck at a time an requested by prime minister. >> ash carter also telling the senator armed service committee that he's contacted 40 coalition partners recently to get them to do more in the fight against isis, and including asking for their own special forces in the fight. strike and reconnaissance aircraft and weapon ammunitions. stuart. >> thanks very much indeed peter barnes check that big boortd. a nice rally up 137 points right now. that pushes above 17,700 right at it. vierra bradley rose 48% in part

because of fewer markdowns. stock is up 30%. new high will with strong sales of drones that's what they do they sell drones. wanting to buy before their regulated up 17%. head back to capitol hill please, the climate summit is coming to an end over there in paris committed now america is committed to a war on coal. joining us senator sherry -- from west virginia, right in the heart of coal country. i'm sure you oppose these restrictions on coal. i put it to you that there's not you can do about it in political terms. you have to go to the court to stop it. haven't you? >> well, we passed resolution of disapproval of the clean power plant both in the senate and in the who is. we're going to put it on his desk that will be the first too many ever been able to get something to his desk that he can veto which i'm sure that he

will. but what it says not just to americans but people nationally is president doesn't have support of congress. we have a bipartisan vote of disapproval of the direction that he's going. certainly this will be fought in the court 27 states are fighting it right now. it is the economic damage that we're feeling r already in west virginia just enormous, and only predicted to get worse. >> you suffered economic damage in west virginia. the heart of coal country. i thought that you were now expoliceemployering that cheap l but you're exportingening that exports have made of for what we're not consuming domestically. >> initially it is propping us up but the world international economy sort of in a downward trend, and so the demand is not there for our full internationally. high unemployment and truckers

and rail jobs those type of transportation jobs we'ves lost in west virginia, it's a disregard i think to the heartland of the country while being in pars, you appears, you know, promisings dollars and metrics because it doesn't have the support of the american people. >> are you fighting history to some degree? in that coal was yesterday's energy source it's not tomorrow's so you're fighting history. are you? i hear that and will be for the next decade. the president even acknowledges that. but while we're developing and using coal as our base load energies we're developing new ways to use or carbon as a product that will have some economic benefit whether it's enhanced oil recovery or other methods so we need to let the research development take hold

so that we can burn it cleaner and reduce the carbon emission. that's what we're asking for. >> got it. senator shelly moore, thank you very much for joining us we appreciate it. >> thank you. >> you're looking at live pictures from new york city hall, people protesting donald trump, and plan to ban muslims from entering the u.s. we'll have more on that later that is going on right now. new york city, chemical dupont in talks to merge, this is a very big deal they say, i say that none is now actually pulling into technology. not so much in industrial america. there's been a shift. i'll have some thoughts on that one. look at this. china smog killing people. 33 cars piled up on the highway, sex six dead because they couldn't see where they were going in the snow.

>> a new e-mail about the attack in benghazi, it shows that pentagon ready to step in. its plans, however, not okayed by the state department. a huge government waste, millions spent on wheelchairs that were later deemed unnecessary dollars down the drain. that story coming up shortly. the new bock this morning dupont talking merger with dow chemical. my first reaction was, so what? what does it mean to everyday people, my answer is not much. what does it mine to average investor my answer is not much. i know this is a very big merger involving two very big historic and names in business but seriously does it mean that much? no it does not. that's because dupont and dow no longer play that bigger role on wall street or in the economy. how many investors in recent

years have put money into steel companies or rubber glass, aluminum or car company or railroad or any of the industrial companies that used to dominate the economy. that's not where the interest is. no. it is technology that is ig ma making running now pouring into apple. amazon. netflix microsoft and dozen other o american tech giants that don't just doll dominate our economy but run the world. investors have been very smart. they see brilliance of silicon valley and break through of iewe they're putting that are money. dow chemical merging to dupont yes it is a big merger but no fire. there's little interest. it is grand dad's era. america has moved on.

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stuart: we are seconds away from some very important numbers on the supply of oil. it is called the oil inventory report. we will find out how much more oil is in storage. how much greater is the supply versus demand. it will affect. okay. this is interesting. we are down over 3 million barrels. we have drawn down the supply. they have left supply on the market. that is why they have gone up. 3870. i would expect the dow jones industrial average to go up more. let's see how it plays out. please, look at the dow industrials. i have and he lived out with us.

andy, are you there? what do you make of this? all expecting that we would increase the cost of this. >> the operating rates have increased. at the same time that we are drawing crude oil inventory, we have been drawing gasoline inventory. keeping pressure on oil prices. stuart: the longest -- whether or not $36 a barrel for oil is the bottom. weigh in on that. is it the bottom? >> we move into january. the return of iranian oil to the market. instead of maintenance periods. that will further pressure.

>> we have had several people say that we could get to $30 or below. would you make that prediction. >> i do not think so. we do know that the production in the u.s. continues to decline with a declining rate count. the market sentiment will change as demand increases next year. >> i have to ask you about gasoline. the regular $1.90 said by christmas. i think we will break $2 friday or saturday this week. we could fall down to $1.95. $1.93. stuart: the most precise prediction for the price of gas i have ever heard. maybe friday or saturday we will get to $2 or $1.99.

>> i have been watching it every day. you can see it coming to the consumer. >> thank you very much indeed. there is less oil in storage. the price has gone over $38 a barrel. the dow has gone up. 167 points as we speak. oil up, stocks up. donald trump. he hogs the headline. here is the latest. defending his suggestion to ban all muslims coming to america. roll tape. >> probably the least of anyone you have ever met. it is short-term. but i can get together. stuart: short sure why we let our country get its act together and jonah, was that a slight

walking back of the battle muslims suggestion? slight walking back? doesn't make it a little bit more acceptable to you? >> no. you object to showing on the ground that we do not have a religious test for people coming into america. people coming to america. i think it is reasonable to have greater scrutiny for people coming from muslim countries, if need be. you do not have enough time to get involved. what i object is a donald trump coming out with a supposed policy. he did not think through in the slightest. asked about it the next day. he had to say we just had custom officials ask if they are muslim.

that is not a serious policy. he is not doing serious policy. he is not even doing serious politics. the poll does not go the way he likes it. he says something crazy and idiotic or stupid and outlandish. he gets everyone to freak out. instead of talking about barack obama's terrible steps across the country in the oval office or the fact that ted cruz was overtaking in iowa, one big idea. everyone took the bait. when do the polling numbers come way, way down. >> your guess is as good as mine.

a great line. a man can be a failure because he drinks. the second he loses the iowa caucus to ted cruz or have some other step back, and enormous baby. his entire motive is based on the idea that he is a winner. he is great. he has to always be on top. the second he is not on top, he throws these tantrums. the greater the tantrum, eventually, he is booted off the stage. >> he is the guy that talks about the issues that regular ordinary people talk about. he has nothing to do with you leads. what regular people have on their minds. that is his approach. >> i understand the first part of the point. i get this all the time. part of the watching establishment. i am criticizing a billionaire

from manhattan that gave mostly to democrats. yet somehow i am the only this. i think barack obama's incredibly antiseptic political incorrectness. the idea that somehow the star of a television shows with billions of dollars, i just do not buy it. >> a great hour two. love you on the show. stuart: i have breaking news for you. fbi director says the san bernardino terrace were radicalized for some time. >> testing for the judiciary committee.

talking about g hottie is him. before they were engaged. they were inspired by foreign terrorist organizations. whether or not others are involved. connecting in the 19 hijackers and conspirators the of the money trail. stuart: got it. thank you, liz. ted cruz. the only candidate that has not publicly attacked donald trump on his fan of muslim having to america. doing joining us now is his coordinator. >> he is acting like a commander and chief. he does not need to attack. >> all of the republicans have attacked donald trump. why not ted cruz? >> first about ted cruz went to washington. he did not duck. he does not go along to get

along. he ends up with what he believes in. that ends with a frustrated public. >> the way he speaks that what he talks about. >> it is straight talk. we are all being said a lot of malarkey. stuart: does ted cruz believed that we should have some restrictions on muslims coming into america? >> yes, he does. i know it sounds harsh. we talk about prioritizing christians. he is not discriminating against muslims. the issue is just like world war ii, not all germans were not these. i'll not these were germans.

are you astonished that the whole election campaign, there is nothing to do with prosperity and the economy. it is all about security. who would have thought that was coming. >> i will say ted cruz was down in front. a couple of debates in the past. look we will not defeat terrorism and we have a president that will utter the words radical islamic terrorists. our president is clueless. october 13 million. more cash than any other candidate other than trump. stuart: okay. thank you very much indeed. >> thank you so much. >> time now for the sector report. you have to be watching those energy stocks.

ashley: absolutely. the entire sector is completely higher. exxon. halliburton. everybody. i will send it back to you. it is all about the oil. those oil prices and what it does to the stock fits in a lot of people's portfolio. >> a new e-mail on the anxiety. it is from the pentagon. ready to send military help. there was no response from the state department. full details next.mouthbre ♪ rip which instantly opens your nose up to 38% more than cold medicine alone. shut your mouth and say goodnight mouthbreathers. breathe right icars to smart phones, requires lithium. pure energy, developing their nevada lithium project, signed a supply agreement with a company building the world's largest battery factory.

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what's in your wallet? nicole: i am nicole iem nicole petallides with your fox business brief. the stocks are bouncing back after a lower open. the dow was up 182 points. 17,750. s&p up 15. the nasdaq up five. beating the dow jones industrial average. dupont. dow chemical. that is up 13%. chevron and exxon. doing well. mcdonald's hitting a new high. the practice plan. after 10:30 a.m. it is doing very well. lulu lemon. coming out with their numbers. the stock has been down.

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stuart: why are we suddenly of 191. i will show you. the price of oil.

the price has gone up. demand is still strong. price up. stocks up. one week after the san bernardino attacks and congress is officially taking on social media's role in terror. jo ling kent on capitol hill. what do they want social media companies to do? the idea is more information from the white house. what the strategy will be to work with the social media companies to combat terror. a lot of individuals have been using twitter to create a culture of attracting people to isis. representative ted poe says he wants to use a pre-existing structure. here is what he had to say.

>> a strategy where we work with the private social media companies to bring out the terrorist sites. they use social media sites to recruit. also to raise money. using the same protocol that social media companies used to bring down child pornography sites. to bring down sites that are foreign terrorists urbanization's. >> using that was calling for more information on the training that is available to law enforcement intelligence agencies plus what the sector is doing in collaboration, that is how congress wants to fight isis. an e-mail obtained by judicial watch. wanting to help as the attack was unfolding. could the navy seals been saved?

>> this is an e-mail. the pentagon chief of staff. 17:19 p.m. just as the attack was beginning and benghazi. we have identified the forces that could move to benghazi. they are spinning up as we see. never responded to. no decision was ever made. none was dispatched to the consulate. >> let's bring in former army special operations. the definitive report. jack murphy. you know what you are talking about with this. could they have been saved? >> unfortunately, i do not think so. also, the special forces.

if you look at the timelines involved, they would have hit the crowd about the time that they annex being hit. they would have gotten at that time. stuart: could they have presented substitute subsequent attacks? >> we had no idea what could have been coming after that. it probably would have been prudent to deploy some troops there. >> they never took off. >> i believe some forces were deployed to europe. >> they never even took off. >> no. stuart: you were a special ops guy. you are not happy.

>> a real tragedy to the whole incident. so many warning signs leading up to it. we should have seen it. we should have prepared the security situation and benghazi before this ever event up lace. >> i thought hillary clinton. even more than that, pat kennedy. he is the one who would have authorized increased security. he really should have been on top of this from the get go. stuart: jack murphy. you wrote the book. thank you. coming up. they did not need him. apparently, they still got them. medicare wheelchairs. right across your wallet. ♪ hold, because my dentures fit well. before those little pieces would get in between my dentures and my gum and it was uncomfortable. even well fitting dentures let in food particles. just a few dabs of super poligrip free

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>> the health and human service department finding taxpayer money being misused. how much? $27 million. unnecessary hop around wheelchairs. joining us now is liz. how on earth is this possible? >> they like to say that nine out of 10 page little or nothing

for their wheelchairs. it turned out because you and i are the ones paying for it. hover around goes to medicare. files a claim for all the wheelchairs that customers are buying. they will prove that they are necessary. they have to prove that a person cannot just get by with a normal wheelchair. to the tune of $27 million. that is just in one year alone. >> it seems to me that everyone is at fault. they were also approved. >> it is really on the government to make sure that the company is following the rules. health and human services signed off on this. the company should have made sure that the wheelchairs that

they are selling is for medical use. it is really us to the tune of $27 million. they should repay the government for $27 million. the inspector general. they contested and said they were not told they had to turn over all the medical documents himself like that. it remains to be seen as they will fight this and whether or not the taxpayers will get their money back. ashley: i will not hold my breath, but it is a great story. thank you so much. the establishment media jumping on donald trump. brent bozell is coming up on that. former ambassadors of the united states. not enough is being done to stop

radical islam in his country. we are talking to him. the third hour is 30 minutes away. ♪

to tromp passing pieces. and the tile and simplistic. he is an addict. a drug of choice.

to top it off, i watched two american anchors on an nbc nation this morning. podcasting from london. reporting that 50,000 britons have signed dave petition to stop donald from entering the usa. they love that because they hate trump. this is the sound of the a leads. realizing they have lost control of the political debate. we do not know how everyday voters are reacting. a poll taken with muslims. trump is commanding the debate. they are not happy. waiting for that first pull. if that poll shows gaining ground, how to redefine. the leads will go nuts. trump's numbers will go up even more. ♪

>> do you regret your ban on muslims. >> it is short term. let our country get its act together. >> probably less than anybody you have ever met. i am the worst thing that has ever happened to isis. the people in my party fully understand that. stuart: short-term only. that is what you said. you let them in. it is not just broadcast media. jumping all over trump. this is the daily news. depicting trump. the statue of liberty. media research center. you saw that daily news front page. what do you make of it.

>> they can do that. they can call him a racist. why not call the new york daily news a religiously big newspaper. they have clearly shown that bigotry towards christians. everybody will jump all over donald trump. donald trump, what he said was reckless and even stupid. does that make him a racist? no. you know, look at what he said. we stop it will be get our hand around it. that could be three minutes later. who knows what he is talking about. is it important? does it rise to the level of the importance of the attention it is receiving. the president of the united

states spoke on sunday night. a commander in chief addressing the second most, the second biggest assault on american soil since 9/11. okay. what was the first reaction to it? the national address. compare this now to donald trump. 105 minutes to donald trump. three in commander-in-chief. they are going after trump. the elites. they are going after trump. trump saying what people think. the elites going after him. that is the divide here. >> he gives them an opportunity to go against conservatives. they look for that opening.

they found that opening and him. we all know it to be true. attention to go after donald trump. he lives all of this kind of silliness. at the end of the day, it is silliness because it is so reckless. it should be reported. put it into its perspective. i think it is much more important, much more serious to look at what the president of the united states has said and his reaction to a terrorist attack. how they managed to say absolutely nothing. stuart: brent bozell tells it how it is. appreciate that. defense secretary ash carter testified on capitol hill right now. pushing for more u.s. military interaction in iraq. peter barnes is following this for us. what exactly does ask carter

walk? >> told the senator committee this morning that we are still testifying that we are prepared to order attack helicopters to iraq. in order to defeat isis. here's what he said. >> the united states is up on trend prepared to assist the army to help them finish the job. including attack helicopters. questions by prime minister. just in the last week. more than 40 coalition country partners. ramping up their contributions to the fights as well. including their own special operation forces. strike and work on it since. stuart. >> thank you very much.

check the big board. we now have a gain of 160 points. dow chemicals. two very big names. in advance talks to merge. 160-point game. fourth straight day of all-time record highs. 117 earlier. 116 now. looks like all day breakfast is working. much less oil in storage. the supply of oil is down. the demand for it is up. that is a big help for the dow industrials. how about gasoline. we are down another penny overnight. the national average is $2.01 per gallon. below $2 by christmas? ashley: oh, my gosh. yes.

by the end of the week. i am confident. stuart: $1.99 national average by saturday. ashley: he did. he gave us a date and how much gas was going to cost. >> it is $1.78 average in missouri. let's go. right now. >> if you drive down i-95 on your way to florida for christmas, south carolina where it is about $1.80, that is about it. >> we love it. >> i am planning my trip in my head. i think it sounds lovely. >> tashfeen malik. born and raised in pakistan. she lived there until she moved here. on a fiancée visa. a former pakistani ambassador to the united states joins us now.

welcome to the program. >> pleasure being here. cannot do much about jihad. >> it can. possibly because our leaders do not have the will to do it. it began with the soviets. the united states. once they laughed, they decided that they wanted to use these jihad in afghanistan. forty jihad groups. not all of them -- stuart: if pakistan, seriously moved against the jihad, would that mean civil war? >> i think that there are concerns about that. i think i am one of those that think that pakistan, this is about pakistan's survival.

if we do not want them to become a jihad state, pakistan's policy. breaking pakistan's relationship did you really have to move against all major jihad groups. some have outlined themselves. some are now aligning themselves with isis internationally. stuart: we have contributed tens of thousands of dollars to pakistan. we still do not have a serious crackdown against the jihad that are now coming here and killing us. i am sure you have seen this frustration. >> absolutely. $30 billion ahead of that since 9/11. the problem is they give the money without -- they did not demand that pakistan is in

india. islam and pakistan. that is good enough. that was not good enough. stuart: always in the background. you have to do something about your jihad did raising a serious issue here. you have to recognize that. >> i do not think that he is in issue in that sense. >> people like me that our are ready on your side being here. dealing with the real problems. there will already be people are ready radical eyes. what you really need to do is lean on the government in most countries including pakistan.

make sure they are reading from the same piece of music. a complete crackdown on all the groups. perspective of what their differences are. >> okay. thank you very much for joining us. lawmakers, i will use the words rushing to prevent terrorists. we will have that next. ♪ so what about that stock? sure thing, right? actually, knowing the kind of risk that you're comfortable with, i'd steer clear. really? really. straight talk. now based on your strategy i do have some other thoughts...

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stuart: look at this. the gaming company is up. the third largest shareholder in the company. that stock leaves the s&p 500. 17%. the latest details on the san bernardino shooting. the mother's involvement. ashley: they wanted no what did she know. did she play any role in this?

how could she lived in the same home where a bomb factory was literally being put together with other weapons. they did find though pro packages. empty packages for go pro cameras. they were not used by these attackers. they like to put them on their body and record what they do when they go out and attack. that was the mother. she has been placed on a terror watch list. >> the mother is in part of that custody battle. they want the six -month-old baby. the child will end up in the system in california. the mother is a big part of that story. trying to get custody of that child. >> good stuff. thank you. the house voted to reform the set requirements. hoping to stop someone like tashfeen malik. sean duffy is with us.

the other shooter was born in america. he was already here. visa restrictions would not stop him from doing what he did. it will not stop the guys that are already here planning on doing what they will do. the jihad that are already here. >> that is a great point. we have violent extremist. we have to get serious about trying to identify what they are. i think the case in point is, when the president said over budgets, he had a homeland security budget. he did not have an item besides violent extremism. the president does not take this seriously. stuart: i do not think most

people realize that. $16 million added to that. climate change. homeland security. nothing extra that we know about. these guys already here. that is the situation? >> that is the situation. barack obama is out of touch and does not understand the threat. he does understand the threat, but does not want to address it. he drags his feet. he kicks and screams. addressing the threat on the homeland from isis or other radical groups. he does not want to engage to protect the american people. look at what kind of enthusiasm donald trump has. some will say it is a little bit -- they want to be protected. chubb is having a conversation with the american people.

>> president obama president obama created a vacuum on sunday night. he had nothing new to stay about stopping jihad. maybe he says something that is outrageous. he is still the vacuum. that is what he is doing. >> george bush got up every day. he went on to protect americans. barack obama has taken an opposite approach. he does not think that it is a real threat. he is talking about done control. a liberal progressive agenda that has nothing to do with protecting the homeland. the american people are following on this. we pass laws. you are talking about syed

rizwan farook's wife coming in on a canine visa. we are locking the front door. we are putting change on the front door. we are talking about our border. the southern border. we do not know who they are. they can be a real threat. stuart: we hear you. thank you. suspected isis supporters. full story in a moment ♪ ♪ i built my business with passion. but i keep it growing by making every dollar count. that's why i have the spark cash card from capital one. i earn unlimited 2% cash back on everything i buy for my studio. ♪ and that unlimited 2% cash back from spark means thousands

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stuart: the maker of handbags vera bradley, it is. it sure helps for stop. they third. the drugmaker. new highs. strong drone sales. why? rushing to buy before they are regulated. syed rizwan farook was an american citizen. born here. raised here. there are terrorists already in the u.s. abby huntsman. how many terrorists are already here? >> that is exactly what we are trying to figure out. we have looked at 71 cases.

the vast majority are john american men. so far 56 people have been arrested. making it the largest number in a single year. also mentioned that 40% of those arrested converted to islam. researchers say because the background of isis sympathizers are so diverse, they are unlikely to be motivated. officials pointing to one similarity. >> not seeing it come find to one particular geographic region or ethnic group. what we see here in the united states, social media if all did almost everyone of these cases. >> social media is not the only. going online. the only realize connection to the group. >> when it comes to links of

isis, we see that some of them are inspired by the ideology. they are just online and flirting with the ideology. they never had any operational connection. we see some americans that have traveled there. >> researchers examine a twitter account of 300 individuals. they found isis is particularly deploying the emotions, needs and weaknesses of young americans. what we are hearing is this is just the tip of iceberg. they're looking into 900 additional investigations of isis sympathizers. this is just the beginning. gerri: stuart: that is a big number indeed. the benghazi attack. military forces moving in. judge napolitano on that. and what he thinks of hillary.

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. stuart: we were up 160 points now we're up a mere 100 points. what happened? i'll tell you what happened. the price of oil which was way up is now up but not much. as oil goes up, stock goes up. oil up not so much, stocks up not so much. got it? liz: i got it.

stuart: clarity, ladies and gentlemen. how about this? a new e-mail released by the pentagon saying that troops are ready to go into libya for the benghazi attack. they never got the aughtization. judge andrew napolitano is here. what do you think of this? >> well, when this was sought and freedom of information request it wasn't identified but it was all e-mails sent to or by the state department at or around benghazi. this particular one was isolated by the state department and held back. so it wasn't until a lawsuit was filed and a federal judge looked at it and said you've got to cough it up, and it was coughed up last night. stuart: is it an embarrassment for the state department and hillary clinton? >> enormous embarrassment. it was precisely where her harshest critics have been alleging what she did. that is to refuse to accept offers of military help,

serious, mature offers of immediate military help. now, the e-mail is pretty brief, it basically says we're ready to go, we can be there in short order, let us know that it's okay for the host country. make sure that libyan troops are not going to shoot at us. stuart: got a response from the state department? >> no. nor did mrs. clinton tell the gowdy committee about this. so what's the likely consequence she's going to be called back and interrogated under oath about this e-mail. why who saw it? who failed to respond? remember there were several attacks that night. stuart: yes. >> that day. there's a five-hour gap between attack one and attack two. christopher stevens and his bodyguards are alive during those five hours, it's during that five-hour period that this defense department e-mail was sent to her staff. stuart: now, this does not put

hillary clinton in legal jeopardy. it puts her in political jeopardy. >> yes. stuart: is that accurate. >> yes. her legal jeopardy is already there. that is profound. that is the 999 -- literally 999 e-mails sent or received by her that were confidential, secret, or top secret. stuart: and legal problem. >> and her failure to secure them. >> there are other legal issues but that's the most profound. this is political. this could be legal depending on how she answers questions. i tell you what the fbi is doing now. going back and reviewing all the q and a while she was under oath before the committee to see if she denied the existence of this e-mail. stuart: it looks so much that they're trying to get her. they'd move heaven and earth to get her on something. what i mean? >> i can see where people would say that. but look at it from the other way. the united states ambassador and her bodyguards were assassinated. mrs. clinton herself put into

a nonsecure domain -- his itinerary about where he was traveling in libya in that time period. mrs. clinton and her aids lied to the american public about the true source of this attack. you've got a congressman trying to figure out what the heck happened. stuart: that's a strong word. lied. but it's accurate? >> well, we now know that she and her aids knew the true source of the attack yet they still propagate at the nonsense that it was a spontaneous political administration that got out of control because of the two by the video made by some crack sense of arrested in los angeles. stuart: bottom line, big time political trouble for hillary clinton. >> yes. yes. absolutely. stuart: judge, many thanks as always. thank you, sir. >> good friend of mine seated next to you. stuart: i'm about to introduce. >> oh,. [laughter] . stuart: it looks like the gop is distancing itself from trump after his most recent muslim comments.

rnc chair said this. i'm quoting now. we need to aggressively take on radical islamic terrorism but not at the expense of american values. it appears, though, the gop could be in trouble if they push trump away. 68% of his supporters say they'd still vote for him if he ran as an independent. the formation friend of judge napolitano. you're a republican fundraiser; right? >> yes. stuart: should the republicans be pushing trump away or embracing him? what should it be? >> stuart,. stuart: stuart. >> frenzy over trump and this extreme view that he took. neither the candidates, the gop, or the political get this. this gave him exactly what he wanted. this is about the american people. they feel no one is looking out for them. he's frightened. and guess what when you're

frightened and nobody is looking out for you,. stuart: you're a republican. what are you going to do about this? are you embracing trump? that's a good analysis that you just gave it. do you embrace the guy? >> we need is to take a look why he keeps going up in the polls. if we want to win this, we need to figure out how to we win over the american people? trump's doing a good job of that and so -- >> you know, you sound like a trump supporter. >> i support anyone that can beat hillary clinton. and clearly when we have a gop who is not paying any attention to what the american people are worried about, then we don't have a chance. we need to analyze what it is that donald is doing. stuart: i'm trying to get to grips with this. are you saying that the republicans who have criticized trump are wrong? shouldn't do it? back off? let's hear more of what trump's got to say. is that what you say? >> i am saying that i understand that we want to get

our rhetoric in line with our values. but to do that, we've got to come up with something that will make the american people feel safe and make them think that we care about them. stuart: and what's that? >> well, that's for the candidates to figure out. not for me to figure out. stuart: they haven't figured that out so far, but trump has. >> that's exactly right, stuart. stuart: so you're back in trump? >> right now, i would have to. i'm saying this frenzy, this frenzy is crazy. liz: they need to listen -- can i tell you something. on facebook do you agree with donald trump? should muslims not be allowed into this country and an overwhelming response said "yes.," yes,, yes,, yes, but i was shocked to see the responses on facebook from our viewers. ashley: let's be honest, he has his finger on the poll. neil: . stuart: what people have not been allowed to say. >> he's created a safe space. ashley: good way of putting it.

he's lill incorrect and they don't care. >> he has drowned out all the other republican candidates, and it didn't cost him a nickel to this this. >> they all sound like hillary clinton, criticized him with almost the exact same words as hillary clinton. where does that make sense? . stuart: i'm almost out of time and i'm about to say goodbye to you on the basis that you're a new trump supporter. [laughter] >> stuart, you nailed me on this today, but i'll figure a way out of it. [laughter] . stuart: great guest. thank you very much for joining us. appreciate it. i've got a big announcement for you. fox business is hosting its second republican debate. the candidates will face off january the 14th. i think it's in the carolina, south carolina i think it is. cheryl: north charleston; right? stuart: north charleston, south carolina. put that date in your calendar. and you. nine days to go before -- i

don't believe this. nine days to go before the new star wars movie opens. why am i interested? i'm not. fans are already. [laughter] -- hold on. we've got to cover this. cheryl. cheryl: this is great, we were talking eight days without a shower, how do you get to the bathroom? lots of questions for these people, they want to be there thursday night, this is eight days away now. ashley: lines in australia to. stuart: no. ashley: yes. cheryl: and what are you doing? i tell you what, guys, real quick. there's a lot of seats still open to get into that movie. if you do an online reservation. why stand there? >> i want donald trump to go recruit everyone in that movie to go out -- [laughter] . stuart: hold on. hold on. calm down, everybody, just crossing the wires, got to get this in, looking into the possibility that the terrorist killer syed farook may have

considered an attack as early as 2011. we're going to ask one of george w bush's national security advisors about all of this in just a moment anncr: when the attacks come here... ...the person behind this desk will have to protect your family. will he be impulsive and reckless, like donald trump?

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stuart: new information from the investigation to the san bernardino shooting. ashley, what do we have now? ashley: well, they're saying they're looking into the possibility that farook -- syed farook may have considered an attack as you just said before the break as early as 2011. sources say now investigators are probing whether farook asked a neighbor, marques the one who bought those guns, whether he bought those guns in 2011 or 2012 to avoid drawing attention to himself. an awful lot of preplanning before the 2015 shooting that just happened in san bernardino. so they're really digging deep to find out wait a minute, this person or these people were radicalized a long time

ago and already started to put the pieces together long before the shooting in san bernardino. stuart: terrorists have been here for a long time. cheryl: marques is a problem, though, for investigators because he went nuts after this whole thing. ashley: he did but he's related, isn't he? he's married to the sister of farook's wife. cheryl: yeah. ashley: there's a weird -- stuart: okay. ashley: okay. so there -- you know,. stuart: but the bottom line here is that -- it looks like they were planning an attack back in 2011 or 2012; right? way before the california -- ashley: also looking into any regulators and how they obtained that fiancé visa into it united states. stuart: very interesting that the investigation raises this point at this point i at this particular time, he knows a thing or two about how to capture terrorists. how do we do it, sir, we know they're here, we know they've been here for a long time,

we're not going to stop them by visas or something like that, how do we get them? how do we catch them? >> well, let me say first the visa thing is important and we need to look at how she got a visa, a woman coming from pakistan, via saudi arabia you would think we would take a good look. stuart: yeah. >> and it's critical to beat isis. that's the inspiration for all of these people. that's the inspiration for all of these people and we need to turn them into losers and that's a military task. stuart: but that doesn't capture the guys and the women already here. and it doesn't identify them, does it? >> no. one thing we need to do there is work more with muslim communities in the wuss be get more people to come forward. we've heard now from farook's father who apparently knew he was radicalized, he just didn't say anything to anybody. so we need to try to get many more of the people in the community, many more people in families. and in some cases we've seen

that happen in europe to come with forward because actually they're saving the family member's life because he or she is going to get killed in the interchange with the police. stuart: now, there are some people who is donald trump's hard line if you want to put it like that against muslims encourages radicalization and discourages moderate muslims from turning in the jihaddist, do you agree with that? >> i do agree with that. what he's doing is demonizing an entire religion and saying all muslims are the same, they're dangerous, and that's going to get people to cooperate less, not cooperate more. it's not only a disgusting legal position but unhelpful position. it's not going to help us get muslims to come forward and work with the police. stuart: i don't mean to throw this at you the last second but i've only got 30 seconds left. what would you do given your brothers, complete power, what would you do tomorrow morning

about isis in america? >> i would start tightening up on various classes of visas that we issue, wouldn't bar muslims, but i would take a more careful look at people, and we're starting to do that, and i would say if we can look more deeply into some of the muslim brotherhood and other groups in the u.s. that have been kind of off limits because of political correctness. stuart: very interesting. you always have good stuff for us. always, always, always,. >> delighted to hear. stuart: thanks for being on the show again, sir. >> my pleasure. stuart: check that big board. what happened to the rally? we were up 160 odd points. what happened, ashley? ashley: oil. as you on said what the oil prices are doing with the market, oil has now turned negative, we saw a bump when we got the inventory levels were showing a bigger draw down than expected, in other words, more oil being used and now reality has set in and

opec is pumping it out at full speed as everyone else and there's too much oil out there and the price is turning sout. stuart: watch out below because it has really turned south. watch out. then we have douglas tom, the founder of north face, died at the age of 72, a kayaking accident? cheryl: he's one of the biggest names in retail, found huge businesses of course in his lifetime walked away because he wanted to live his life, and he wanted to climb the top mountains in the world, he wanted to go kayaking, and he wanted to live his life, and that's how he died, living. the kayaking accident, unfortunately, is kayak overturned, ended up of dying of hypothermia, everyone else okay except for him. stuart: what a tragedy, a man does all of that and then says i want to live a different life, goes out and lives it and dies in a tragic accident. extraordinary thing. cheryl: yeah, but his life was extraordinary, he wrote a book

about his life several years ago. ashley: never went to college. fascinating story. stuart: it is fascinating. it really is. well, great country. that's america. ashley: yeah,. stuart: new report from the congressional budget office. the equivalent of 2 million jobs have been lost as a direct result of obamacare. we have a full explanation for you in a moment you get a cold. you can't breathe through your nose. suddenly, you're a mouthbreather. well, just put on a breathe right strip which instantly opens your nose up to 38% more than cold medicine alone. shut your mouth and say goodnight mouthbreathers. breathe right

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stuart: the rally has gone. we're up only 12 points. why? because price of oil is moving down again. it's now down 37.24 as oil goes down, stocks go down. oil goes up, stocks go up. that's the story of the day, folks, and we may be pressing close to $36 a barrel as we speak. now this. a new study shows the true loss from obamacare due to a reduction in work hours. obamacare could cause 2 million jobs worth of hours lost in the next decade. let's see if we can get grace marie to explain. what's that all about? >> well, basically saying because of the incentives in obamacare, people will work less. they will choose to work less, the equivalent of 2 million jobs over the next -- stuart: why do they choose to work left? >> because they don't have to work to get health care, they can get tax paid subsidized health care. stuart: don't the employers,

there's an incentive for them -- >> absolutely. stuart: to exploit less hours part-timers. >> absolutely. which is why it's the bigger story than the 2 million jobs lost, looked at the bigger picture because employers also have an incentive to cut hours not chosen by the employees and also to just not hire those mostly entry-level workers in the first place, he thinks it's closer to 4 million jobs we're going to lose because of obamacare, which is why the congress voted last week in the reconciliation bill to do away with the employer mandate. that's such a distorting impact. stuart: yes. but the president -- not going to touch that. >> right. stuart: i think obamacare is spiraling down towards just going away in some way. collapse. >> people are so -- we're having united health yesterday cigna had said they're thinking about not participating in 2017. if you don't have the private

insurance companies participating, the exchange is basically dry up. we've learned today that maine, the one co-op that was supposed to have been working is now stopping enrollment for individual policies. so -- cheryl: horrible. >> over and over and over. stuart: it's a collapse. >> the cost, people don't like the coverage, it cost too much, the deductibles are too high for the premiums, we now know people are going to pay almost $1,000 a year for fines for not complying with the individual mandate. there are so many things that are wrong with this law, it's never getting more popular,. stuart: it's collapsing. >> 2017. stuart: grace marie, you've been with us since the very beginning of obamacare predicting its demise. >> do you think i'll be here until the end, stuart,. stuart: i think you'll see it through. i really do. i i hope so. grace marie. all right. we will have more varney after this

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>> i understand that we want to get our rhetoric in line with our values. but to do that, we've got to come up with something that will make the american people feel safe and make them think that we care about them. stuart: and what's that? >> well, that's for the candidates to figure out. not for me to figure out. stuart: well, they haven't figured that out so far. >> that is exactly right, stuart. trump has. stuart: i pushed her. she was thinking about supporting trump. she did. cheryl: she's great. stuart: let's see what you viewers have to say about trump and muslims. here's what you have to say on facebook. kim says trump's a problem solver, not a politician. what he proposed isn't possible, but it would count on a democrat effort to take in refugees. okay. says trump has changed the conversation from gun control to this in 30 seconds. good for him. ashley: that's true. cheryl: i was shocked last night. i'm sorry i know we've got to go. i was shocked last night to look at my facebook page to

see the responses from viewers. overwhelming support for donald trump on this. stuart: overwhelming. cheryl: overwhelming. it's surprising. they believe in him. stuart: it's fascinating. neil cavuto, my time is up, but it's yours now. neil: thank you, sir, we've got a lot to follow here, not only this crazy dow but more we're getting on syed farook, it went down in san bernardino, california and now we're finding out from the fbi director that syed farook radicalized a lot before not just within the last year but try the last three years. they even met online and as early as 2013 they were talking about things like jihaddism and working to find others that were involved. so far seems to be indicating to those questioning on capitol hill that there are a lot of eyes that are not