♪ >> regrettably. we're out of time. fortunately neil cavuto is here to take it away. neil: that is weird, stuart. once again, when it looks like the attention shifted away from tax cuts, the markets kind of meander. the better looks for them, the worse it looks, uncanny. >> yet you have this political turmoil in washington with the resignation of general flynn but markets really holding up at astronomically high level. i find that fascinating frankly. neil: you're looking at the half-full glass. i admire that. next two hours, a half-empty glass. we have a lot going on, thank you, stuart, very, very much. it is uncanny, folks, i keep mentioning it is up.

we're in record territory here. but it is always fascinating development for me to watch to see it play out. if it looks like the guys are distracted in washington, general flynn resignation or host of other factors they get a little bit antsy. just my opinion, when they get antsy or something like the tax cuts don't look doable and talking up health care getting it done and rework done, the markets say where are we going here guys? this is an example of that. take a look. >> we are focused on repealing obamacare, replacing it with the types of reforms that work for patients. >> we can not slow down. we have to repeal and we have to replace it. >> we're continue to work to repeal obamacare and replace it with a 21st century health care system that works for everyone. >> this step by step approach will rescue people from obama care's collapse and give every

american access to affordable, quality health care. neil: all right. now the markets have their doubt about this because they have been talking about this a while, and they know how hard these guys are trying to do this the fact of the matter there is bodies agreement how they go about repealing and replacing. they're all on treatment repealing obamacare. that is republicans, they can do that in a "new york minute." what they're divided over how quickly they can act on that. then the markets look at this in a larger context, don't think that is not important but we think the tax cuts dramatically simplifying the tax code that is more important. that is a consensus view i get from more and more market leaders. now does that mean they wouldn't be encouraged by something that simplifies the health care i will about, the health care law, finds a leaner, meaner way dispensing health care in this country? by all means but they also know, quite candidly, that republicans are seriously divedthis

issue. how much divide and and distraction with the drama on capitol hill with certain security departure, let's get to this with heather hadley manning. john corpina, meridian equity partners. john, end with you, begin with you, am i right the markets much more interested in tax cuts happening that even obamacare being repealed or replaced? >> i do agree with that. that is what investors feel much more comfortable at, see if something does this goes through, how it goes through is a little uncertain. if something goes through it will have an impact with main street immediately. that is one of the higher items everyone is looking at. clearly obamacare is something on the radar screen and really

focused on it but when you look attacks main street america can equate to how much money do i make and how much do i have to give to the government? if that number goes down some way, shape or form, main street will feel good about that. that is an easier concept to understand and everyone looking at at this point. neil: when we came in this morning, hadley, the markets were selling off. obviously the flynn news was front and center, every web page what have you. it isn't surprising markets run up, stumbled a little bit that this distraction would be more than just a distraction. i don't think it was accidental or coincidental you had the republican leadership reminding people we're working on repealing and replace, repealing and replace. what did you make of that? >> it is important to focus on, it is important to focus on policies that affect the economy whether tax reform or health care reform. repealing obamacare would be a huge tax cut, there were 20 tax

increases in the law. this is not just affects economy of health care, but also 1/5 of our economy, but every employer over 50 workers is affected by the employee mandate in the aca. that affects hirg and wages. obamacare is a economic issue. neil: i don't minimize the aca, which she is referring to affordable care act, better known as obamacare, but kathy, i always wonder whether republicans got their priorities mixed? i got a lot of wrath and heat from people, neil, we're looking for widespread voter fraud in the last election. fine, you know i'm not minimizing the fact that could have been a big deal, whether three million vote, big deal, i just, thinking that it is a weird way to kick things off when, when i think those tax cuts, i think the regulatory reform are probably more immediately pressing, you but maybe washington can merrily move on walking, talking, chewing gum at the same time.

what do you think? >> i don't know. i covered two administrations, i don't want to give away my age. i have covered two administration. neil: i covered 28. >> what my sources are telling me there is chaos now. they're seeing transition happening after the transition. not everyone is working. what don't know what trumpcare looks like. paul ryan was optimistic he would get things done and his corporate tax cuts would happen and we're all waiting for corporate tax reform. we're not talking about it. the white house is not talking about it. the tweeter-in-chief i heard him called is not talking about it. we need to know what trumpcare will look like? will paul ryan finally pass his reform. these are important questions that need to be answered and distracted by mar-a-lago and crazy photos. i have never seen this any white house that i covered. neil: you don't seem to like the president. >> i don't want to say. neil: you're blocking.

you're blocking. >> i don't like what he is doing. i don't like what he is doing. neil: this is valentine's day we should show love for everybody. >> right. neil: that is just a little cture there. jonathan, if looks like repe and replace, whatever you want to call it is delayed and looks more problematic than even republicans thought, do you think they should go full throttle behind the tax cut, because that they have broad agreement on, what do you think? >> absolutely. when you talk about repeal and replace we know what that means, but we don't know what that will look like. how long will it take? what will you repeal? what will you replace it? neil: right. >> you had three different republican speakers came up to use kind of a blanket answer what replace is going to be. that will have to be in my opinion put to the side for now and it seems like there is some clear agenda how we will see tax reform. people can equate to that bert. we'll see that translate into the market right now. we have so much uncertainty, yet

the market has not sold off from the uncertainty. neil: that is a very good way to look at it. that is stuart was doing in his show. through all the problems and controversy and mar-a-lago thing with people shooting pictures and all that stuff, there is confidence through all this we will get the tax reform. through all this republicans wit right themselves and things will be fine. do you agree with that. >> i'm sorry. i keep cutting you off. neil: that mine fault for not being clear. hadley. >> look back to 2010 when we saw the affordable care act pass. that was a messy process. people forget. we don't want to see another mess from republicans when it comes to health care reform. ultimately democrats were able to get it done because they made compromises, they came together and found consensus behind the plan. i think republicans can do same thing when it comes to health reform. they can do the same thing when it comes to tax reform but they can't do everything at once. they need to set realistic expectations when it comes to health reforms.

insurers have to file rates early in the year what happens in 2018 already. we may not see immediate impact from health reform. neil: i don't know where you stand on this, kathy, we'll get the repeal thing done but idea they will quickly replace it, i don't if he that will be in the offing. >> too many distractions. it will take a long time if the distractions continue. gop has to get together in congress do what they do. they can't be lapdogs for trump right now. let m do what he will do with his team. get everyone in place. we still don't have everyone in place. the white house is running without a full staff. neil: whose fault is that? they block the january tore. >> they lost flynn, whose fault was that. neil: no you didn't? >> yes i did. neil: thank you very much what happens here. as she pointed out here general flynn is out. what is curious about this, how did he get out? in other words how was it revelations came to light on

what he was saying to a phone call to the russian ambassador. who looked that out? even president trump tweeting saying why are there so many illegal leaks coming out of washington. keep in mind, remember the famous phone call with the australian prime minister? someone at state department got that out there. remember all the devastating details about an unbalanced tax code in the middle of the steve mnuchin confirmation hearings for hearing? who got that out there? that would be somebody from treasury. you think of agencies have to report to the new leaders. they might not be on the same page as leaders. they might try to undermined those leaders. to one of the smartest guys i know, former fbi official, steve rogers. steve, that is telling because it is consistently happened. i have never seen an administration right out the box just getting exposed on this stuff from the very agencies which it has jurisdiction.

>> neil, you're absolutely right. it is consistency of what is happening that is very concerning. look there are no doubt some, could be pretty much high to midlevel individuals, or an individual who is leaking this stuff out. they probably believe that they're doing it for the good of the country because they probably don't like the president but in fact they're hurting the country. look, neil, general mike flynn was a great choice that the president made for national security advisor. it is unfortunate this happened. the president showed some extraordinary leadership by quick decision he made to accept the the general's resignation. let me add this, it wasn't just a leak that ended the career of general mike flynn. i believe it had a lot to do with misleading the vice president. whether he did it intentionally or not is to be seen but i think combination of both those things did him in. but get back to the idea of people leaking information, you know my wife and i were talking

last night, president trump has not had chance to enjoy presidency. it is one thing after another. people in the post are upsetting the applecart here. neil: should we be surprised about it? incoming energy secretary rick perry was famous for saying he wanted to demolish the department, get rid of it. you have incoming treasury secretary, steve mnuchin who is famous for saying the way the treasury worked and counted impact of tax cut is wrong. so one institution after another comes back and it seems like the worker bees are reminding their new political chiefs, you guys come and go, we're here forever, and we'll make your life hell. i don't think i'm imagining it because it happened in a number of cases, particularly on these security iues. >> neil, you're absolutely right. i can tell you when i worked at the national joint terrorism task force, we were terrified some briefings what would happen to us if we leaked information.

if we inadvertently took information out of the buildings. there are political people within those agencies now that need to be removed. i'm sure, i am hopeful that the new attorney general will be directed by the president to get on this right away. they may just have to clean every single agency out, because this is bad for our country. they're not hurting just the president of the united states who deserves a decent shot at this but they're affecting in very negative way the national security of this great nation. they will have to get on this immediately. neil: shouldn't general flynn have known though, if you're talking to the russian ambassador there is a good chance someone is recording this, monitoring this? >> it's a mystery, isn't it? he is a smart guy. sometimes we think everything will be well-taken care of and no one will do these things. he made a misstep here, unfortunately, i really mean unfortunately, it wasn't good for the country, i send him certainly god's blessings, he does well wherever he goes.

neil: good man, good patriot. steve rogers, as are you. thank you very much. john mccain is questioning how the white house could be so close to russia on the very same day russia, they're calling it a spy ship just off the eastern coast, of course in international waters, and then all these revelations from that phone call general flynn had with the russian ambassador? so he is worried. is retiredeneral anthony zinni? he is next.

neil: all right. when it roehms it pours, right? john mccain saying i told you so in a way, flynn resignation really erupting over revelations

of taped conversations he had with the ambassador of russia. we shouldn't be surprised by any of this. added with the drama of a russian spy ship just off the u.s. east coast, in international waters i stress, still a little bit weird because of what it is capable of doing. we have u.s. retired marine corps, chief of the u.s. central command, lt. general anthony zinni. john mccain said at outset, i told you so, be careful with the russians, be careful what you're deing th, what do you think of that? >> every president since the end of the cold war tried to improve relationships with russia. it has not worked out. in the end the russian leadership, especially putin, has you know mined those attempts. we had the reset button. neil: yeah. >> we had president bush looking into his soul and seeing something obviously wasn't there. i don't fault president trump for trying to create a better

relationship and reduce tensions. i think the best advice to be, be very careful with. the trust has not been built up and it is demonstrated it is not there. neil: i don't want to get sidetracked by the john mccain riff but it is pretty pronounces. obviously the senator and former presidential candidate was elected in arizona. he feels bulletproof and he should winning election people thought he would lose. he is not a fan of this president. the president said tough things about the senator. how is this going to go? they could be at each other's throats for a while here? >> yes. and that's unfortunate. i think, you know, you would like to have the senate and the congress overall in line with our approaches on an international front, and in line with our policies. i think there is, a lot of doubt in congress about whether our relationship with russia can be

improved, and i think a lot of concern that we may offer things or remove sanctions or do things that will in the e hurt us. that they will take advantage of it. they will violate any agreements and it will be tough to walk things back at that point. neil: how do we gauge the promising leader we can work? you know this history far better than i but when mikhail gorbachev appears out of nowhere, it wasn't out of nowhere, i grant you, that he looked like a promising figure. ronald reagan said famously, this is a guy i can work with. obviously presidents of both parties, vladmir putin, not so much. but when do we seize on, on someone with whom a u.s. president of any party can say, we can make progress? >> i think the key is, and i went through this when president clinton was trying to improve relationships with iran, when

president hatami was elected. looked like he was a moderate. tensions were easing to a certain degree. we could see that when i was commander of central command. neil: a moderate over there is a nutcase by almost any other definition, right? >> you know, he, he was very cautious, president clinton, and said let's test this. neil: right. >> if you can remember back, we lifted the embargo on persian carpets and pistachio nuts. sent wrestling teams over there. you know i think the key is, what do you get in return? if you get, if you use a measured, slow pace to show that you're willing to do things if the other side does things, if they are willing to do things that demonstrate that they want a better relationship and improved relationship, fine, you could move it at a pace suddenly leads you where you want to be. if they do things that upset the

ecart, situation like the ukraine, their involvement in the middle east, in syria in particular, if those kinds of things come about, you have to have some means of insuring there is a penalty, and stepping back from that relationship. neil: real quickly, what do you make of this russian spy ship coincidentally seen off the u.s. east coast shore in international waters? i hear the russian thing, i know it has been there a while. you guys just discovered it, but timing is weird. what do you think? >> nothing is done without a purpose, especially the russians. i think the purpose is there to send signals, what that might be is we're still here. we're waiting to hear, you know what this new relationship might be. but, you know, but it is to say we're a threat and we're still around. i think, that is the purpose of doing things like this. buzzing our ships, and doing other things that sort of raise tensions. neil: general, always a pleasure

having you. thank you for your great service to this country. meantime as the general and i were speaking here we're getting word deputy national security advisor, kt mcfarland, frequent guest on this net it work and fox news, before that met with president trump today, asked to stay on despite general flynn's resignation. many many say she could be a emerging player within foreign policy matters within the administration. she is very smart cookie. that makes a good deal of sense. we'll keep you posted on this, chris christie and his wife arriving at the white house a sht timego with president trump. now that is interesting development in of itself and the presence of mary pat. she is the wife here. she was supposedly not too keen on some of the positions governor christie was supposedly offered in the trump administration. it wasn't worth the family uprooting them, the fact she is with him, i don't know, more than just lunch?

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neil: order smorder who needs controversy over executive orders we can enforce laws we have. we're getting indication of pickup recently federal agents picking up 600 illegal i am my grant in raids across the country. to a former i.c.e. prosecutor, maybe this is the thing we should be doing, not necessarily boeing back and forth on orders dragged through courts, et cetera. john, good to have you? is that what is a the play here because it definitely picked up? >> neil, thanks for having me on. what the president is doing enforcement action, simply enforcing immigration laws. he doesn't need to issue executive orders that create controversy in federal courts. he needs to protect the united

states enforcing current immigration laws. not much of these were doing at all, these were enforcement actions planned long before president trump took office. these are not his actions, they are not draconian raids that happen every time under a president. neil: this is dramatically picked up, do we know whether there is a link between the rejections or the appeal and the successful appeal of that of the president's order? is there a link there? >> no, neil, i don't think there is a link at all. neil: interesting. >> ben these enforcement actions, they're planned month in advance. i was one of the attorney advisors in the room with the i.c.e. agents vetting targets we would go after. neil: how do you select the targets, john, that is interesting? >> you select them by people who are dangerous to the community first of all, aggravated felons, violent criminal histories. people who have reentered the united states multiple times

after being deported. that is who you target. you don't target good hard-working immigrants in the country, doing what they're supposed to be doing, not a danger. those are not the people we send our i.c.e. officers out to be rounding up. neil: do you target sanctuary cities. >> no, i don't think you target or not target sanctuary cities. these types of raids don't play intohe sanctuary city narrative because these enforcement actions don't go to the jails and pick people up. the jails and detapers happen on daily basis. these are targeted enforcement actions that go after certain groups of immigrants who have presented a danger to the community or violated immigration laws in severe fashion. neil: john, while i have you here, you touched on it the president's executive order that became a separate soap opera. would he be in the legal pickle he ultimately found himself in, slowed it down at beginning, made a clear carveout for those with green cards, alerted

airport personnel, they said they didn't know what was coming? i know the danger of that everybody is in on this including the bad guys but could that have avoided the mess it became? >> yes, without a doubt. if the president had slowed this down, rolled this out in a fashion where everybody on the ground at the airport, the ayes attorneys, the, they could have avoid fiasco couple weeks ago, terrible as far as optics concerned for the president that looked awful what was going on at airport. they were detaining united states citizens and lawful perp ment residents. they are were not earn forcing current law and they could have done it much, much better. neil: john, thank you, former i.c.e. prosecutor. governor chris christie is having lunch at the white house

now with president trump. a lot of people reading a lot of things into that. governor christiwas one of the earliest supporters to back donald trump. that carried considerable weight when donald trump needed it most. that was an establishment guy who had said this is the guy, and, today he is rewarded for that, after this.

neil: janet yellen, fed head running fedal reserve. she said rates coming. never say how much. never does. god forbid they get remotely specific. can't say whether increase comes march or june or 2years from now. -- 28 years. slowing immigration slows economic growth. that was at the administration. whatever you do on this front will hurt the economy. we've been waiting too long, that could force the fed to raise rates rapidly. in other words because this is a slow-moving process, the fact it is delayed you could see more rate hikes normally would be the case. none of that dramatically altered stocks here. they're up 30 points. any gain after yesterday which was a record, would in fact be a record. i do this for you so you don't have the crunch the numbers at home.

something that charlie gasparino and i follow very closely, comings and goings in the white house. look who is coming over for lunch. governor chris christie and his wife mary pat here for lunch. this is interesting fact that mary pat is joining him. he had a pick of cabinet or subcabinet positions i don't know what the truth was, but mary pat was not keen on offerings are or uprooting family from new jersey to go to washington that. is this a sign to win her over or woo her for something more meaningful, anyone's guess. i pass that along. i often times think it is very significant when the spouse comes along. here is charlie gasparino, back from -- are you okay? >> got my voice back. neil: what a party for your wife. >> the whole neighborhood was happy. neil: what do you make of this? what is going on here? >> listen there, is no doubt reince priebus, chief of staff,

at least among the washington talking heads is coming under some degree of pressure. people are openly questioning whether he is right for the job. neil: right. >> whether he is doing a good enough job. i would point out this. i think you can appoint jesus christ to that job and they wouldn't have done a great job. why is that? trump has horizontal management style. neil: he has -- >> i'm telling you if you think about it, trump has a who are sental management structure. neil: always things trump. >> they all fight amongst themselves. chief of staff is really not empowered to keep people in line. neil: here is what weirded people out. bannon in chief strategist role might be -- >> jared kushner is an advisor. who knows who he reports to. neil: right, right. >> so priebus has a very difficult job. amid that you're bringing in somebody who has been talked about as potential chief of staff, chris christie, new jersey governor.

i can't imagine blows out priebus now. maybe he puts him into advisory role. neil: do you think thrill will be a job offer out of this? >> i think trump thinks he need a stronger hand in the white house to manage things. neil: can you imagine if he were a press spokesperson. >> it would be great. he would be a great chief of staff. priebus would be a great chief of staff if donald trump empowered him to be the chief of staff. i think this comes back -- neil: you just hate e hit on it. that job and your success is determined by your boss. >> it is circular in this sense, priebus is not given power to keep the trains running herding the cats. everyone who is in that job, you have 15 chief of staffs, five, i could name a couple of them. jared kushner, steve bannon, lines priebus, his kids to certain extent. neil: i was talking to karl rove who was saying there was understanding between he and andy card who came in, that

look, there is a protocol here. you better get under the protocol. but someone confidante from year one or the beginning of your campaign or prior, they're not going to answer to protocol. >> that's the problem. that it's so disoriented and dispersed -- listen, what was the problem, hate bringing this back to scaramucci. what was the main problem? i don't think it was his company. speaking out of turn at davos, talking about all this crazy stuff. priebus said enough is enough. we don't need some guy who is special liaison in the president to talk about all these different issues outside of the control of me. he has every right to do that. neil: think of ones who were rewardedded in this administration, they didn't speak a lot. >> no. i'm telling you when you have gary cohn as potential chief of staff, as nec chairman. neil: he has rocketed up in influence here? >> he is a tough, smart guy. neil: economic council?

>> head of nec, national economic council. neil: how does that jibe with treasury secretary mnuchin. >> because the treasury secretary is in the meeting, in the old days some treasury secretaries said i want hid of these meetgs. i don't want the head of n. c. cohn didn't do that. cohn said i want head of these meetings. national economic policy will be set largely by gary cohn. there is rumor going around there is another separate cabinet post, council of economic advises kudlow was going to get. that is no longer cabinet post because of gary cohn. he nixed that as cabinet post, further consolidating his power. neil: kevin brady, the house ways and means chief, neil, we're looking at big sweeping tax cuts. marry it with corporate tax reform. we'll get it done this year. if it gets done before the summer, it would be retroactive. pushed into the fall, a point of approval. >> right it will be simple

majority and it will get done. i think that is a big reason why wall street has never looked back. >> yeah. i mean no doubt. that they are banking on significant corporate tax reform, particularly corporate tax reform. but some individuals and individual tax reform and regulatory reform. here is the one fly in that ointment. if you have a dysfunctional white house where stuff gets bottled up because there are two chiefs of staff, that may not happen until the second part. year. that could be problematic. neil: without naming names outside of brady that is their biggest fear. that is crumbles in the white house. >> look at it. they can't get anything done. neil: buddy, glad you're better. glad you're back. not the same without you. >> thank you. neil: michael flynn left the administration. that resignation has democrats pouncing. democratic leaders on capitol hill and talking to reporters. let's dip into that. >>re at thwhite house, i want the press to press these questions. who at the white house decided

to do nothing for three weeks as flynn sat in on meeting after meeting after meeting? did the president decide to wait? did council decide to wait? something is wrong here. madam leader, just this morning flynn tweeted, and this is a quote, scapegoat, end of quote. scapegoat. he basically describessed himself as a scrape goat. i believe we need to hold a public hearing with flynn to get to the bottom of this. our committee held three or four emergency hearings on hillary clinton in a matter of a week or two. if there was any emergency at this moment, in the history of this country, this is the moment. so we need to get his security clearance documents. i want to see them. i want to he see what he put in those documents to find out if he was honest on those forms, and we need to know how much he

got paid to have dinner with putin. but that is only the beginning. the press asked us over and over again, asked leadership and leader, should things end here? no, they can not end here. ladies and gentlemen, we're in a fight, for the soul of our democracy. the question is, is whether, whether we will clearly understand that this is our watch. let's be clear. scff said quite eloquently. the republicans needo join us. this is not a democratic issue. this is not a republican issue. it is not an independent issue. this is an american issue, for the soul of our democracy. gives me great pleasure to introduce the chairman, ranking member of the judiciary committee, mr. conyers. >> unless we want to yield to the leader? >> i'm sorry. >> ranking member. >> thank you so much.

the overdue resignation of general flynn last evening does not resolve this matter, i want to make that clear because i've been trying to get my chairman of the judiciary committee to hold a hearing immediately today. certainly not later than tomorrow. what did president trump knew, and when did know it? what did vladmir putin know and when did he knew it? how is it possible that the white house counsel knew this for three whole weeks and did nothing? the american people deserve

answers and they're not receiving them from either the trump administration or from the republican congress. so we will do everything within our power to continue to get to the bottom of this very serious breach and trust and security. we have not heard back from our, our leadership today. and we have called, repeatedly to chairman goodlatte about this matter. now, why is it that the flynn resignation does not resolve this matter? we need to know and to find out who authorized flynn to speak to the russians. we need to know why he lied to the administration and the american people.

and why the white house counsel's office sat on this information for three weeks. now, it would surprise me to find out that flynn was acting on his own. he seems to speak to the president of the united states almost every day. and so, we want everyone to know that this is just the beginning of a inquiry that we're not making accusations. we're just trying to find answers to these very vexing problems. thank you. mr. thompson. >> benny. >> good afternoon, i'm benny tom man, ranking member homeland

security. what you heard from other members, this resignation only starts the issue. there are a lot of unanswered questions. you can't blame the press for a person's resignation. the press just like the people have a right to know. there are a lot of unanswered questions go with had resignation as members of the congress we're duty-bound to try to find answers to. i'm looking forward of the leadersh, ould they desire on the republican side, step forward and do the right thing for is country. russia under any circumstance has demonstrated that they are a bad actor and complicit in a lot of what is going on. the people have a right to know. and so, we are here today to put front and center, while this is the people's house, the people,

just like members of congress, have a right to know what is exactly behind the resignation. who knew what was going on. neil: not surprisingly the democrats are pouncing on the resignation of national security advisor michael flynn. that it doesn't stop here. it starts here. they're talking about hearings to look how much he knew, and when he knew it. how he had security clearance when he did and with whom he did and was still able to attend highly classified meetings. even all the way up to the president of the united states, whether he was aware that his national security advisor then in the relate of just a private citizen might have been talking to the russian ambassador about dumping out of those sanctions that president obama had imposed for the russian's role in the 2016 election. so much going on here, distractions, when the

republicans choose front and center going about aggressively repealing and replacing amacare and taxes on this very show. congressman luke messer, the beautiful state of indiana. congressman, what do you make of what is going on here? obviously democrats are saying, no, no, just because general flynn is gone, this issue is not gone? >> yeah. well, neil, this is serious business. there's, you know, appears mr., general flynn's resignation was appropriate under the circumstances. i think it is true we need to get to the bottom of the facts here. i also think most americans see that press conference played for what it is, typical washington politics trying to go after folks, trying to frankly jump to conclusions and we'll see where this goes. neil: but are you worried, you know, regardless of what you think about the investigation, what the democrats are saying or politics of it, that is always out there, that it is going to

distract from your message or slow what you and your colleagues want to do, whether repealing and replacing obamacare or dramatically cutting regulations or obviously the biggest enchilada of them all, tax cuts? are you worried about all of this getting away from that? >> well, look we've got to do both. the american people do deserve the fact what is happened here. hope the trump administration is forthcoming with those facts. but we were sent here to get big things done for the american people. we promised to repeal obamacare and replace it with a better patient-centered alternative. we need to do that we are on the path to get that done in the coming months. you mentioned earlier on this show, kevin brady, his efforts to put together a bold tax plan to get the economy going again. that is it what we were sent here to do. we need to get to the bottom of the facts these other matters as well. i'm confident we can do both. neil: sorry to abbreviate this with all breaking news. you were very generous with your time. we appreciate that.

that is what you see going on here. democrats seizing on this as proof this administration clumsily and maybe dangerously handled sensitive data they should not have, in ate capacity, private citizen capacity with general flynn was not even part of a cabinet or this administration period. there are laws against that sort of thing. no one has ever prosecuted anyone based on that sort of thing. he is out of that job. people are starting to say, what else did know? why was he continually granted high security access and, what did the president know? and they're not letting go. and wall street for the moment doesn't seem to give a damn.

neil: look what apple is doing?

all time intraday high. yesterday all-time closing high. well into record territory for this stock as well. back to levels it was, had been two years ago. it fell. now you know where we are today. big reason why the dow is advancing today. nicole petallides at new york stock exchange. incredible, huh. >> it is incredible. you didn't know where everything is going. goldman sachs at new high. you have apple breaking out to a record high, neil. i know there is some skepticism about apple and its newest phone due out back half of the year for the 10-year anniversary. the market cap is behemoth at 700 billion. the iphone is the big cash generator and many analysts who are all for apple. they still think it is moving to the upside. in fact goldman sachs puts $150 price target on this one. in their note it will include 3d sensing and other major

features. sensing a very strong upgrade cycle. 26 analysts who are upgrading apple. for those skeptics out there, you have to wonder, maybe we might be missing something. maybe apple will bring it for the 10th anniversary. we spoke with somebody who we keep close in touch with the technology sector. he said latest leaks we've seen are good ones, wireless charging, water resistant and augmented reality and services that arenderrated. ck to you. neil: augmented reality i get nervous. i just get nervous. all right, nicole, thank you very much, nicole petallides. we have a lot more. sean spicer ready to address the troops, the reporters. these are always riveting affairs. chris christie luncheon with the president. so much going on, if you leave because you forgot to get your spouse a valentine's gift, she or he will understand. america is at stake. we'll have more after this.

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neil: the white house briefing moments away. the president of the united states, a lot of lagging as to whether a job is offered and a way for the president to sell it to her, involving uprooting the kids. we are following closely as is my brother -- my buddy connell mcshane. we have so much going on here, democrats are not letting go. surprise wall street is doing as well as it is. this briefing is set up to be something else with sean spicer in a few moments, we know what democrats want to focus on with

their news briefing a few minutes ago and the president and his allies want the focus to be on the leaks, out of washington. if we look at the president's tweet from earlier today, the real story here is why are there so many illegal leaks dealing with north korea and the republicans picked up on that. once the fbi to assess the recent leaks and this is a big deal because when the intelligence community captures a phone call involving an american even if there is an american national on that side, with the russian ambassador, the identity of the american is supposed to be shielded.

we do know that that american was national security adviser michael flynn. why do we know that? who leaked it out? that is a legitimate question, what the republicans want to focus on. on the other side as we watch democrats in their briefing a few moments ago we get the idea what they want to focus on with general flynn having left after these conversations with the russian ambassador and apparently talked about sanctions and misled the vice president about that is we were g that has been done starting with washington post and continued elsewhere that somehow the justice department had come over and warned the trump administration that general flynn may have been vulnerable to being blackmailed by the russians was that is what democrats want this to be focused on in terms of when did the white house find out about this, who in the white house knew about it including the president, you will see sean spicer try to keep the focus on the leaks while the reporters will bring up those questions we heard from democrats. neil: where did the black male come in? if he is talking to the russian

ambassador, leaving that aside. what would he have, what would be shared that would represent the russians? connell: the washington post talked about this and others, saying to the vice president, and we didn't talk about the sanctions, the president obama imposed on russia. and we better do xyz. he didn't wanted to be exposed. that is what is alleged here. the justice department went to the white house with that information that he could be vulnerable. neil: talking to a top russian

official, a long security background. >> and an american, his identity is not supposed to be known, so i'm sure spicer will keep focused on that. neil: it is like working with imus. if you phone anyone, he is listening in. it is not a surprise. neil: very similar. thank you very much. if the markets get flustered, in the course of the last hour, helping things a lot at an all-time high which most of the stocks are up more than offsetting are down.

what is interesting is the markets seem convinced this will blow over. a lot depends on what we discover about these leaks, jason beardsley, very good to have you. thanks for taking the time. >> thank you for having me. we have seen a lot of kabuki theater here, you and connell mcshane laid out a case of what is happening. neil: we are not imagining, the australian prime minister phone call was leaked out here, that would have to be someone in the state department but we have seen this time and again in the new young administration. i'm wondering what is going on? >> you laid out the perfect case. we have a lot -- leaking phone calls from our head of the state, from our president to another head of state and that will shatter confidence in our

foreign-policy overseas if people don't believe the sanctity of their conversation is held in high regard whereas what we are seeing our political opposition has a scorched earth policy, make no mistake this is not about general flynn, lieutenant general flynn, this is a political grenade, anyone in the 5 to 10 m radius with political shrapnel. if you saw a few moments ago in the press conference, democrats are not going to stop it, going after trump and anybody they contain with this. this is about theater. what needs to happen, the real story is where are these leaks coming from. what i want to ask your viewers, remember our troops, 76. what we saw were senators that went after a politicized bureaucracy to uncover how nixon may have used those tools for political purposes.

we need to see the same level of investigations. neil: i always remember the bureau of labor statistics, and political leaders come and go and we will be here forever. the worker bees. not needing to disparage them all. they have a sense of permanence. they are the first to react to incoming secretaries who would want to up vladimir putin nap same, we see almost the muni against betsy devos at the state department when rex tillerson was going through his confirmation process and i could go on. if you were president of the

united states, and it is getting leaked out, and -- >> it is political warfare and opponents have a scorcher of policy. and entrenching the bureaucracy. to defend the people. not their political purposes. like flynn has bucked the system, and secretary of state tillerson pushing back on these institutions, with faith and confidence, to hold in secrecy what ought to be in secrecy take it behind closed doors we do there's an ethical problem -- neil: is there a danger -- the presser will start and i don't

want to crowd that. and if they say no this is a political witchhunt, and both sides can play political football. >> if republicans are smart they will have hearings, talking a church commission and how these leaks are happening. let's find out who leaked the australian prime minister, let's find out which people, and the real problem, is not about mike flynn, why the government civil servants are devolving secrets that are kept behind closed doors. don't take our eye off the ball and go aggressive. and the president should not use these tools politically but neither should the opposition, there is a shadow opposition here that needs to be uncovered.

>> jason beardsley, thank you. and stocks are getting antsy. they have a funny way of showing it. marketwatch, larry shelby joining us. >> there is a shift in psychology. and crossing that 2300 mark, not to have a retracement, and chasing mentality waiting for that turn around from the market, and the twitter feed, missing the fact that corporate profits, and p.m. is, and

produced 4% year-to-date performance. >> up 6/10 of 1%, and the pace of rate increase, and oversimplifying. how do markets climbn the face of that. >> and shoulders in the fact. and the bigger picture. and if we run a little hot, they will but she suggested or insinuated that. neil: how would the markets more than just a few rate increases, it gets to be 5 or 6. >> we are in trouble, running way too hot and that certainly is an outlier although outliers

happen. if we have three that is trouble enough, building into and good reasons, the right reasons. neil: the futures contracts, you know better than i but we see expectations based on remarks today that maybe they are being conservative. what is the limit, the market could stand because they see tax-cut coming and wanted to be big. >> absolutely and back to the point capital expenditures. i have been on fox 7 years and never seen that on tv, it is neat to say that but the market can withstand three hikes. anything more than that obviouy needs to be for the right reasons but beyond three that would spell trole for the markets because then it becomes

a relative game. the s&p being too hi, i would say that is not true. on a relative basis it is okay. it wouldn't be long duration but more than three would spell trouble. neil: even market rate hikes, maybe this great boom for housing and real estate, even though i can remember rates being a lot higher than these levels, there's a whole generation of young people who don't, and disqualifying to get a mortgage that could disrupt this whole thing. what do you think? >> the 10 year, 30 year come along end of the curve, we will not see a lot higher than you are seeing. the 10 year yield up to and 3/4% but we are in this long, winding cycle of people continuing to think we will have a recession at the end of the day. we are in the midst of $11 trillion experiment that has

never been attempted before. 4% gdp, 2%, the new 4% so when you have a 10 year yield up to and 3 quarters, and much higher than that this year. neil: good seeing you again. and the white house issues not really focused on market issues here, bush xliii that ryan, good to see you. you are looking at this. the media ght be -- as our a lot of these other soothsayers who say this is going to be investigation investigation, recrimination after recrimination. it seemed trump stopped their soul. is that right? >> seems the wheels are coming off the train. day 26, we already have the

national security advisor having to resign under accusations that he has been working with the russians before and after the election, this is really a big deal, the question is -- neil: the same time period. >> i don't think there is anything to be proud of right now. talking to reporters who cover legal injustice issues the other day, there was a lot going on they could have been covering, they could have been covering potentially the swearing-in of jeff sessions, they have to be covering whether kellyanne conway was doing something illegal when she touted nordstrom. they could have been -- neil: i want to go back to shawn spicer. >> i can sense the love in the

room. last night the treasury department's office of foreign assets control labeled the venezuelan vice president as a specially designated narcotics trafficker under the kingpin act was before i continue withhe brfing and look forward to your questions i want to turn it over for a short time to newly minted secretary of the treasury steve mnuchin to take the restatement on this and deliver the same questions. >> pleasure to be here on my first busy day in office. yesterday that the permit of treasury's office of foreign assets control designated venezuelan national specially designated narcotics trafficker pursuant to the foreign narcotics kingpin designation act for playing a significant role in international narcotics trafficking. the primary front man of the

venezuelan -- was also designated. these designations follow a multi-year investigation into his criminal activities and president trump appreciate the hard work put into this case by the department of treasury, department of state and national security council and many people throughout law enforcement. following the signing of the executive order last week designing to break the back of criminal drug cartels, this action demonstrates the president's seriousness about fighting the scourge of drugs in the united states. in addition, he wantss to send a clear message to the people of venezuela that america stands with them. with that i am happy to take two or three questions specifically about this. >> sanctions are directly relevant to the treasury departments.

can you talk about plans to sanction russia. >> our current sanctions programs are in place and sanctions are an important tool that we will continue to look at for different countries but it is a very important program within the treasury department. existing policies are in place. >> additional sanctions against iran, what you think the bottom line will be if these sanctions announced yesterday are referred to today for the venezuelan vice president? >> first let me comment, this is the result of a long effort. is was underway, very long effort but the implication is ite siificant. there will be tens of millions of dollars and sanctions are a very important way of sending a message that we will not stand

for illicit activities whether they are drug traffic or terrorism. >> what other tools are you looking at. >> i can't comment on all the tools, a very important tool within the department, use them as appropriate. in this case we did freeze assets again, tens of millions of dollars of assets that will have a big impact, so i will take one more question in the back. >> during the campaign, the president made comments about janet yellen and whether she was being too political and she should be ashamed of herself and folks at the treasury department and the administration feel confident with this is yellen, to be able to set monetary policy going forward. >> we are here to talk about the venezuelan situation. it is a tradition for the

secretary of treasury having ongoing meetings, i look forward to that and spending time. thank you very much. >> back to the fun. we have been reviewing, i want to address, evaluating this to general flynn on a daily basis, we get to a point not based on a legal issue but a trust issue with a level of trust, had to make a change. misled the vice president and others who have been concerned on light of sensitive subject that was on the position of china, north korea and middle east, in unwavering trust to the

people in that position. the evolving and eroding level of trust as a result of the situation and a series of other questionable instances led the president to ask for general flynn's reservation. after the department of justice notify the white house counsel of the situation, the white house counsel brief the president and the group of senior advisors, the white house counsel reviewed and determined that there is not an illegal issue but rather a trust issue. during this process it is important to note the president did not have attorney general jeff sessions, approved by the senate. when the president heard it was presented by white house counsel he instantly father general counsel, generally did not do anything wrong and review collaborated that. for a national figure advisor to speak to his counterpart about issues of concern to them. he spoke with over 30 of his

counterpart in the transition. as charles krauthammer said last night it is, quote, perfectly reasonable for him to do so. the issue was the president got to the point where general flynn's relationship misleading the vice president and others where the possibility he had forgotten critical details, created a critical mass in an unsustainable situation. that is why the president decided to ask for his resignation and he got it. the irony of this situation is the president has been incredibly tough on russia, continues to raise the issue of crimea which the administration allowed to be seized by russia. his ambassador to the united nations mcghee haley stood before the un security council on the first day and strongly denounced the russian occupation of crimea. as ambassador haley said at the time the, quote, dire situation in eastern ukraine demands clear and strong condemnation of

russian actions which president trump has made it clear he expects the russian government to de-escalate violence in the ukraine and return crimea. at the same time he expects to and wants to be able to get along with russia unlike previous administrations, solve many problems facing the world such as the threat of isis and terrorism. the president is currently evaluating a group of strong candidates, considered to fill the national security advisor position permanently and is confident in the ability of general kellogg, a decorated and distinguished veteran of the united states army until that person is ultimately chosen. before i get into the president's schedule for today a quick recap of the president affectivity over the next few days which we haven't had the honor of spending much time together. the president has been keeping a close eye on the orval dam situation in california, we worked closely with california's first district for the dams located and other state officials to help people who have been impacted. the situation is a textbook

example of why we need to pursue a major infrastructure packaging congress, dams, bridges, roads and all ports around the country have fallen into drepair. in order to prevent the next disaster, we will pursue the president's vision f aorn overhaul of our nation's crumbling infrastructure. we hope evyone remain safe as the evacuations continue and we will be working alongside with fema and appropriate government entities to make sure we are doing everything we can to attend to this matter. the president is honored to welcome the prime minister of japan last week from the first official meeting at the white house to their joint press conference in mara lago and their time together, the president and the prime minister had a productive visit and reaffirmed their determination to further strengthen the us/japan alliance and economic relationship. the president was proud to stand behind prime minister abe to convey the united states's unwavering support for japanese allies in the face of north korea's most recent missile

launch. on sunday the president met with secretary treasury steve mnuchin and steve wynn before returning to washington. the president had an incredibly productive set of meetings and discussions with the prime minister of canada focusing on our shared commitment to close cooperation addressing challenges facing our country's and the problems throughout the world. the countries share profound economic interest with $2 million across the border every day. the president was pleased to launch the kennedy united states council for the advancement of women entrepreneurs and business leaders by holding a roundtable discussion at the white house, together with the prime minister, the president discussed the unique challenges women face in the workplace with an incredible group, successful and respected female business executive from both countries meaningful list of the participants is available. in addition to his in person meetings with the prime minister's of japan and canada

president had phone calls with the presidents of tunisia, peru, nigeria, colombia and south africa. readouts are available on all those calls. finally following the prime minister's visit the prime minister met with chairweren't mcdaniel of the republican national committee. in the afternoon the president participated in a ceremony with major ricardo turner, one of his military aids, they are midgrade offices, one from each of the services provided direct support to the president in his role as commander in chief and their primary responsibilities are to serve as emergency action officer and it is a long-standing tradition one of the president's military aids promoted the next tire grade, the president conduct that promotion, major ricardo turner, military aid was recently promoted to lieutenant colonel and promotion was held in the oval office. the president spoke yesterday with marine scalia on the 1-year anniversary of her husband's passing, the president and mrs. scalia discussed her late husband's and credible legacy

and how the president is making an effort to carry on by nominating judge course of his shares the love of the constitution to succeed him on the bench. leslie the president hosted the swearing in of secretary steve mnuchin in the oval office, a world-class financier whose decades of experience with monetary matters be the ideal person to spearhead the president's plan to develop a dynamic booming economy that works for all americans. we are glad to have him on board. the president and newly confirmed secretary of education held a parent-teacher conference with parents and educators from public, private, charter and homeschool. and congratulating toughness in staying the course throughout her confirmation process. he then discussed his vision for all americans have an opportunity to climb the ladder of success starting with making quality education available to every child no matter their zip code. under the current system the

president says too many children are trapped in failing schools especially in the african american community. the president said this is a civil rights issue, he wants parents to decide what educational options are best for their children. the group launched into a wide-ranging discussion in public and charter schools, homeschooling, dropout prevention, the basis schools program, states response abilities and the current state of the department of education. the president's ultimate goal is to create safe communities, great schools and well-paying jobs. he believes each of these is linked to the others and a trump administration taking concrete steps to achieve them all. the president spoke on the phone earlier today with prime minister mae of the united kingdom continuing productive conversation during her visit earlier this year. a readout on this call is soon, the president had lunch with chris christie and his wife regarding combating drug use, at 2:00 the president will join house resolution 41 in the oval office.

it is the start of rolling back harmful obama era regulations which cost the american businesses consumers a staggering $890 billion making companies less competitive and even driving them out of business. the american free enterprise system is the greatest engine for economic prosperity in the world but for too many we must remove the barriers to productive productivity that are holding back our great workers and businesses. misguided federal regulations such as the sec rule addressed by hjr 41 in flex real costs on the american people and put our businesses especially small businesses at significant disadvantage. it is a priority for the trump administration to fix our broken regulatory system so that it enhances american productivity and well-being without imposing unnecessary costs and burdens. signing this joint resolution is one more step toward achieving this goal. later this evening the president will meet with secretary kelly and attorney general sessions to continue discussions on

potential options for addressing the very clear national security threat they are facing in light of the recent supreme court ruling, tomorrow the president is welcome, pleased to be welcoming israeli prime minister henchmen that yahoo the white house, they will discuss ways to advance and strengthen the special relationship between our two countries. and addressing the threat posed by iran and its proxies, the crisis in syria, countering isis and other terrorist groups. the president made clear his administration will work to achieve competence of agreement an end the israeli-palestinian conflict. the israelis and palestinians can live in peace and security. the way forward toward that goal will be discussed for the prime minister and the president would they will hold a joint press conference tomorrow as well and further guidance will come on time and location. looking ahead to friday the president will travel to charleston south carolina to attend the rollout of the first boeing 787 dream liner. this is it will give the

president an opportunity to celebrate huge milestone for thousands of workers. america number one exporter and millions of american workers in aerospace, the trip has been months in the meeting and we are thrilled to celebrate the rollout of this amazing claim. with that i will take questions. jonathan karl. >> in january the president said no one in his campaign had been in touch with the russians. now today can you still say definitively that nobody on the trump campaign, not even general flynn had any contact with the russians before the election? >> my understand we were very clear during the transition period he did speak with the ambassador -- >> talking about during the campaign. >> there is nothing that would conclude anything different has changed with respect to that time period. was notified 11 days ago that flynn had misled the vice president, other officials here, he was a potential to threat to blackmail by the russians why would he be kept on for almost three weeks? >> that is not -- assume as lot

of things are not true. the president was informed of this. he asked the white house counsel to review the situation. the first matter whether there was a legal issue. we had to review there was a legal issue which the white house counsel concluded there was not. as i stated in my comment. this was an act of trust. whether or not he actually misled the vice president was the issue. that was ultimately what led to the president asking for and accepting the resignation of general flynn. that's it. purand simple t was matter of trust. we went through a very deliberative process, a very thorough review. the first part was clearly to understand the legal aspect of this. that was simply concluded there was no legal aspect. then what happened the president evaluated the trust aspect of it. major. >> when the president was asked on air force one yesterday, friday, traveling down to mara large foe about reports -- mara lago about reports about conversations, i said i don't know about it. i will look into that. was he being truthful?

>> what he was asked was he aware of a "washington post" story. he hadn't seen that atç the ti. of course he was involved. i said he was aware of the situation right after the white house counsel informed him back in january. >> his inquiry to the white house counsel was strictly about the legalities involved not propriety of conversations between general flynn and russian ambassador -- >> just initially -- >> merits of those conversations about sanctions before the trump administration had been inaugurated? >> just to be clear the acting attorney general informed the white house counsel that they wanted to give quote, a heads up to us on some comments that may have seemed in conflict with what the he had sent the vice president out in particular. the white house counsel i informed the president immediately. the president asked him to conduct a review whether there was a legal situation there. that was immediately determined there wasn't. that was what the president believed at the time from what he had been told. he was proved to be the correct. issue pure and simple came down

to a matter of trust. the president concluded he no longer had the trust of his national security advisor -- >> was it proper for the incoming national security advisor, not part of an administration discussing issue sensitive as sanctions. >> his job is to discuss issues with his counterpart. chorals krauthamer put it perfectly last night. that is what he is supposed to be doing. that is hisç job. we would constantly reed out throughout the transition who he was speaking to, how he was getting ready. the president was receiving congratulatory calls throughout the world. we would read out world leader calls. job of nsa is to sit down with the counterparts to start the dial look. that is exactly what he did. the question was not whether he did anything improper or illegal? the question could be trusted further. the erosion of that trust is the issue. >> president instruct him to talk about sanctions. >> no, absolutely not. no, but, no. there is no, that has never --

>> would he prefer he not talk -- >> the president had no problem with the fact that he acted in accord what his job was supposed to be doing. he had the ability to talk about issues that were important. whether it is that or 30 other countries that he spoke to. that was part of his job has been the nod by many people. that is what the national security advisor and frankly other positions do. they begin the process of preparing their incoming job by talking to counterparts, people previously held the job. if he had not done, whether would be questions whether he was properly prepared on day one. >> the conversation -- >> isn't issue is whether or not he discussed. there is complete legal review. there is no issue with that. whether he failed to properly inform theç vice president or t be honest with him or not remember it. that is the plain and simple issue. when he lost trust with the president, that is when the president asked for and received his resignation. >> yesterday kellyanne conway, counselor to the president, the president continued to have

trust in general flynn. >> right. >> what happened between yesterday morning and yesterday evening that led the president to lose confidence in general flynn? >> i'm not getting into the specifics what the president's thinking was, i will say i noted in the opening statement. it was evolving and eroding process. at the end of the day the president made a decision as he does on all subjects and asked for and received the national security advisors, he is one of those people noted before. when he is ready to make a decision he makes it, whether hiring somebody or asking for someone's rest egg nation. when he made a decision on any subject he informs the staff. going into the day it was evolvings situation. he made a determination late in the day and executed on it. >> loyal person, general flynn was it a difficult decision for the president to let general flynn go? >> sure. general flynn is dedicated public servant. he is head of dia. he is an outstanding member about army as a officer and a

flag officer. he served this country admirably andç i think the president appreciated his service to his nation, his commitment to his campaign and his service to this country so far but at some point the decision came down whether or not that trust had eroded. the important matters, as i mentioned that are before the president when he is dealing with issues of world matters, of all the issues, friends, allies, foes, hot spots, he needs to rely on an national security advisor to give him sage advice, i think at a certain point, that guidance, that trust eroded. the president as he does on all matters ultimately decides when he is ready to make a decision executes. alexis. >> does the president believe anything that he discussed with general flynn during the transition might have been construed by the general as request or encouragement to discuss the sanctions with the russian ambassador? that is question number one?

>> so, there was a pause. so on the first, again as i made clear there is nothing that the general did that was a violation of any sort. he was well within his duties to discuss issues of common concern between the two countries. i will say it again, what this came down to a matter of trust. the president was glad he was out there conducting his job, preparing for his job, going back and forth with his counterparts throughout the world much as the president had done with all the world leaders calling the president, congratulating him, looking to set up calls for him once he was inaugurated. similarly general flynn was beginning that process with his counterparts throughout the world. that was never concern to the president, from day one he was briefed from the white house counsel. issue plain and simple came down to matter of trust, once that occurred, it was over. i'm sorry. >> [inaudible]. the president is believe that any discussion that might have taken place, and we know from intel it did, on

sanctions, creates a problem for the president in any, in any way? that is not a problem that general flynn disssed sanctions with russians? >> no. i can't say it clearly enough. there was nothing in what general flynn did in terms of conducting himself was an issue. what it came down to plain and simple was his misleading the vice president and others and not having a firm on his recollection of that. >> lawmakers on capitol hill on both sides want to have a probe about this does the president cooperate with those investigations? would he instruct members ofç s staff who work for him here and in the administration to cooperate with shows investigations? >> we're going to comply with the law. i think the president feels very confident the review that was conducted by white house counsel was very thorough and concluded very conclusively as he first

come to instinctively come to the conclusion there was nothing wrong. people are free to do what they wish. they will find what the president first believed and what white house counsel concluded, i believe a couple of publications reported there was no investigation for a reason. it was not issue of law. it was an issue of trust. george. george. >> when do you have expect to have replacement in place? secondly on another topic, there was report yesterday one of your colleagues says the white house is keeping dossiers on reporters? can you say if that is true or not? >> that is absolutely not true. there are no dossiers. just binder i put right here. that is about it. that was a joke. hold on one second. and i'm sorry, george, the percent part? >> timetable on replacement. just like the way he handled this situation, the president will meet with individuals and when he is ready to make a decision, he feels as though the person is qualify, and can

properly advise him on issue heç will makehat decision. as all decisions rest with him. go to my first skype seat, john huff, kvvu out of las vegas. john? >> thanks on behalf of viewers in southern nevada to join you. las vegas suffered terribly in the last recession more than than any other city in the country. as the administration moves forward repealing financial regulations and possibly dodd-frank, what guaranties than hose actions will not allow banks to investment banks, to engage this risky behave behaviors that left taxpayers on the hook to bail the banks out? >> john, if you look at intent of dodd-frank it was to make sure we didn't have institutions too big to fail. frankly it is actually created institutions that are now too big to fail. dodd-frank actually did exactly

the opposite what it intended to do. i think when you look at the regulation, hjr 41, the president signing today, this is another example of the president taking decisive action to roll back regulations that are frankly creating more of a burden on our nations banks and businesses than helping them. i think the president will be very clear making sure we do things that build up theç goalf what dodd-frank actually intended to do but right now we actually with dodd-frank put taxpayers more on the hook than let them off. we created more institutions and more guaranties for the federal government to bail out institutions if they exceed their authority. john roberts. >> let me go back to the beginning. you said white house counsel office reviewed this determined nothing was illegal. what evidence did they look at making this determination? secondly, democrats up on the hill are say they want an investigation into this. they're looking into what did

the president know and when did he know it. can you tell us what evidence you looked at at the white house counsel office, what did the president know about all this, when he was he aware of it? >> the first day the department of justice made white house counsel available, sought to notify white house counsel was january 26th. the president was immediately informed of the situation. as i said, based on the information that was provided at the time. his view was, that this was not a violation. he was proved instinctively correct. white house counsel at that time undertook extensive review. both of materials and questioning -- i'm not going to get into the specifics. what i will tell you on multiple occasions they had an exhaustive andç extensive questioning of general flynn on several occasions based on information that was provided to them or materials that were provided to them to review. i'm not going to get into the details of that, but i will say there was exhaustive review. the thing that is important to

note is the vice president, myself, in fact i think the first time i brought this issue up was january 13. the department of justice didn't notify the white house or white house counsel at that time in the transition phase until 13 days later. so i think it is important to understand something very, very important. this idea of why did it take so long, the first question should be where was the department of justice in this? they were aware of this. we were making statements based on what general flynn was telling us starting on january 13th. the vice president went out on the 15th. they didn't notify the white house counsel's office until january 26th. at that time there was immediate, the president was immediately informed of that, and then asked the white house counsel to conduct a very, very thorough review. the first part of that review was focused whether or not there was any legal issue that's it. once it became the issue it shifted into phase two whether or not there was trust still

maintained. then that became a separate set of issues -- >> speaking to theç actual evidence, that the fbi has tranripts of these intercepts which i assume were done by the nsa via fisa court order. was think any communication between the white house counsel and fbi, did those transcripts ever -- >> was there communication between the white house counsel and justice department, i will not get into that. because of nature of information being discussed. >> why not dismiss the january 27th. if the question was trust, immediately january 15th, on faisst the names, saying that this is what general flynn told me. january 26th, you hear the opposite. why not immediately act. why wait another 2 1/2 weeks. i don't understand how that is not due process? acting attorney general came in

said there was issue. wanted to give you heads up there may be information, okay? she could not confirm there was an investigation. it would be unbelievably shortsighted and wrong to go in and dismiss someone immediately. what the president did take decisive action to make sure the white house counsel thoroughly reviewed and vetted the situation. he took immediate, decisive action. if you look at the timelineç in terms of what he did, how that expanded, white house counsel first and foremost pole to make sure there was not a legal issue at hand. once that was concluded a phase of determining whether or not the general's action because on this and whole host of other issues undermined trust in the president. but the president from day one, from minute one, was unbelievably decisive asking for and demanding his white house counsel and their team review the situation, first and foremost whether it was a legal issue and what they immediately determined, not immediately, but within self days after review --

several days, after review it was not a legal issue and it moved into second phase. mark. >> the president tweeted this morning the real story is leaks. >> it is leaks. if you think about this, understand, that all of this information was leaked. i mean, again i know we've got this me lecturing about what story should be, but i think there is a real story here. the idea not just in this administration, the obama administration, going back to the bush administration, in fact we have issue where classified information of which this would is handled in such a way it is being given out. i know in some cases it's a good story. i understand that, to some degree your responsibility to write that but i also think there is a story about amount of leaksç coming out people entrusted with national security secrets and classified information are leaking it out. that is a real concern for this president. that when he is talking on the phone with a world leader, that when he is making key decisions in the interests of protecting this country, that we have to

wonder whether or not people who work for our government who are entrusted with classified information and additional based material are leaking that information out? that i do believe is a big story that should be reported. i believe the president is rightly so, very, very concerned about this because it is not just something that is plaguing the current situation, but it goes back through the obama administration, bush administration, clinton administration. when we have government employees trusted with this, leak it out that undermines our national security frankly. craig? >> what -- i'm sorry. i apologize. >> i know you just forgot. i have a question, but i want you to clarify something you just said to john. are you saying no one has read the transcripts of calls or you don't want -- >> i said i'm not going to comment on this. >> my question is on sanctions. you were very specific about sanctions against crimea and doesn't want to lift them until

crimea is concerned but the sanctions flynn was discussing were sanctions for election hacking. >> th is something the president could remove on his own if he wanted to. is he committed to keeping those? >> secretary mnuchin commented on that. there is no change in our current sanctions strategy with russia. i have nothing for you on that. trey. >> the current story is leaked, what is the president willing to do to investigate further to determine where these leaks come from. >> this goes back to the way he negotiates. telling people what he would do to cover up additional leaks, wouldn't be a sound strategy making sure that wouldn't happen again. president is clear negotiating with issue like this you don't telegraph to people how you handle it. hoed on, trey, gets a follow-up if everyone else got one. >> he will take some sort of steps to investigate the leaks? >> the president is clearly upset about this. he understands the threat they pose to our national security. he makes sure he continues to make sure that stops.

yes? >> thank you. so, you mentioned time and time again this is an issue of trust. you also said that it was an evolving issue and that the issue of the trust that the president had for flynn came down to this deception that happened where the vice president, a host of whole other issues. what were the other issues?ç was the vice president the only person that was misled by flynn? were other people misled. >> i stood before you before explained what general flynn conveyed to me. i think there were others he similarly expressed that to as well. so, you know, that is why it is others because it wasn't just people who went out made public pronouncements, in a series of questioning rather exhaustive over a long period of time he continued to maintain that had not occurred. i think that is where the president continued to -- that's why, the president was very clear it was eroding issue because it wasn't, it was after a series of issues and a series

of statements and pronouncements that the president came to that conclusion. >> were there other issues outside of this call and discussion over that, that led to the mistrust? >> i think the statement is very clear. it was this and a series of issues. with that jason stevens of the federalist paper in ashland, ohio. >> thank you. what our readers of the federal lift papers project are most interested in is returning the country first principles of republican government as unstood by the founders. one of these principles in the declaration of independence, is consent of the governed. my question is this, what are the president'sç future plans rolling back expensive and burdensome expensive regulations administrative state, the product of unelected unaccountable bureaucrats never received the consent of the governed to do anything, let

alone make law? >> as i mentioned today the president in a few minutes will be signing hjr 41 one of those attempts to roll back some onerous dodd-frank regulations with respect to the sec in particular. he is going to continue, last week we rolled outnoth one of those executive orders that insures that for every new regulation, two to must be gotten rid of. the president's commitment to rolling back regulation and overreach of government is unwaiverring and unquestionable. you will continue to see this president undo a lot of that government overreach. jim? >> quick question, you said early in comments that president is incredibly tough on russia. how is that possible? he he made comment, over the course. campaign and transition where he defended vladmir putin. he had an interview with bill o'reilly, when he was asked, vladmir putin is a killer. well you know, america hasn't been that much better -- also to me it seems, to a lot of americans it seems this

president has not been tough on russia. how can you say that. >> because i just walked through. there isç difference between, president wanting to have, understanding of how a good relationship with russia can help us defeat isis and terrorism throughout the world. look the obama administration tried to have a reset with russia. they failed. they tried to tell russia not to invade crimea. they failed. this president understands that it is in america's national and economic interests to have a healthy relationship. if he has a great relationship with putin and russia, great. if he doesn't, then he will continue on but he will not assume because it wasn't able to happen in the past, i think you have seen with prime minister abe in particular, and others, reset that president, prime minister netanyahu talked about tomorrow, so many of these countries from around the globe are looking forward to resetting relationships this country has with them. they feel they were abandoned over the last eight years and that they are excited about the prospect of a new u.s. relationship under a trump administration. so, but respect to russia i

think comments that ambassador haley made at the u.n. were extremely forceful and very clear, that until they -- >> ambassador haley. not the president. >> she speaks for the president. i speak for the president. all of us in the administration. all of actions and words in this administration are behalf and in direction of this president. i don't think we could be any clearer on the president's commitment. >> quick littleç follow-up. follow-ups -- >> really. >> questions in a while t anyway. the other question is, just getting back to wat was asked a few moments ago about trust and being misled, are you saying that the national security advisor was intentionally misleading the president, the vice president, yourself, when he made these comment -- >> the trust is given by the president. it's a relationship between he and any individual. and so as i mentioned in the comments, maybe it was, i don't know that it was intentional. he may have just forgotten.

at some point -- >> would you forget -- >> that is the point, jim, at some point that trust eroded to a point where the president did not feel comfortable with him serving in that position and asked for and received his resignation. katie pavlich. >> on the -- [inaudible] last night in general flynn's resignation letter he said he inadvertently briefed vice president and others incomplete information. >> right. >> considering his role advising president on national security matters, maybe he briefing on president-elect and information on other matters and national security in addition to phone calls with russian am door. >> when you look at team, itç s not one person in isolation, katie. you have general kelly on the homeland security front. general mattics on dod front. he has an entire national security staff and apparatus that briefs him. director pompeo from cia and dni

brief him on whole host of issues. it is not a single person. >> is is it isolated incident or -- >> not as though there is one person briefing him. the president sin that sizes information written and stuff briefed to him. ultimately he makes that decision based a lot what he already knows and what he is presented with. the president gets information from a lot of people, generals, admirals, people in the military community, people in the state department, exhaustive team at national security council and makes ultimate decision based on that and what he knows to be case. >> sean? you've been asked a couple times about transcripts of calls. >> right. >> will the white house declassify those and release them. >> look, inappropriate for me to comment on those at this time. right now the focus is on some of the evolving issues that are,

that we're going around the globe as you know. >> [inaudible] >> let me answer the question. >> it isç not an issue come up. i think president right now isds national security advisor. making sure he is presented with the best possible information to make these key decisions. but at this time we also got to be careful we're not involving ourselves into national security. the review as i mentioned was done, immediately last night when the president felt it was time for a decision made it. that is are with we are in this iteration of the process. if we have anything further i will update you. joyce cough man of wftl, talk news in palm beach, florida. >> thank you so much for that opportunity. i'm approximately six miles away from mar-a-lago right now. the president met with prime minister abe from japan at mar-a-lago this weekend. besides giving us traffic and security nightmares, there were apparently conversations took place by telephone and with the prime minister that were in

relatively insecure dining area. there is already video of this surfacing. will there be a skiff put in place in these dining areas, these public places. one was question, when meets with prime minister netanyahu will he discuss moving the embassy and settlement? >> on second one i'm not getting ahead of the prime minister's discussion with the president. we'll have aç readout after th. there will be a press conference. with respect to the first, there is a skiff mar-a-lago. to be clear the president was briefed in a skiff ahead of dinner. went with the national security team. they briefed him on the information about north korea. subsequently he had a dinner attended by exclusively by u.s. and japanese delegation members. at that time there was apparently photo taken which everyone jumped to nefarious conclusions that were discussed. there was discussion of press logisticses to host the event of

the after the dinner president went back to the skiff to get update. i am not sure people jumped to conclusion. there is a skiff there. it was utilized on two occasions to be briefed by national security team. situation in north korea. the president stood shoulder to shoulder to japanese prime minister, to make sure of their security and our stand against north korea was fully made aware. >>

>> who had any communications with the russians about sanctions. >> there's no other information. i mean, as far as we are aware, that is an isolated incident that occurred. and, again, the key poinin