administrations because president trump wanted to be a disruptive type of person in washington and he has done that and how we did it in the bush administration isn't necessarily applicable, of course, comparison helps you make sense of the world but i do hope that the president would even say to somebody like jared or ivanka, i hear you but you to run that through john first. if he does that, that will help. >> one of the things every president has kitchen cabinet or close advisers that are not cabinet officials per se but they rely, ronald reagan had his buddies out in california who would advise him on ad hoc basis but it never got, i don't think it got to to the point of being disruptive that replaced the powers that be and that's where the issue of order has to come back in. do you think that general kelly will have the freedom to tell

the president, this is disruptive, sir, this is getting in the way of my job and helping you to do your job? >> i think he could probably try to do that. i know that the president likes to call around to several of his friends. i actually think it's the leak investigation for the ones that kellyanne conway, the embarrassing leaks, internal white house staff. i think that could be coming outside the white house of people inside the white house including the president telling his friends or former colleagues about it and those people telling the press. a game of telephone and that makes sarah huckabee sanders' job very difficult. neil: there are leaks going on. they are out of control and maybe that's why priebus even though he might not be the leaker but it was happening and that's the big reason for this. >> i will tell you one thing, it's always good for staff to have a healthy respect and a little fear of the chief of staff. okay, when i think fear meaning

that i would not ever want to disappointment or upset andy or josh. neil: well said, thank you for taking the time. >> thank you. neil: a little bit of fear, will this be the case for general kelly? ♪ hey, i'm the internet! i know a bunch of people who would love that. the internet loves what you're doing... ...so build a better website in under an hour with... ...gocentral from godaddy. the internet is waiting. start for free today at godaddy.

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neil: welcome back, i'm neil cavuto. cost of freedom, change that is go on like in corporate america when a new chief of staff comes in, it's like a top, top adviser to the ceo trying to ride the ship and help the poz. that's really what is going on here but it's interesting in washington and more to the point in the white house, the chief of staff is also sounding board for the president of the united states, not only offering all points of view and all members of the staff have different points of view but weighing in on matters that they have strength, for example, in military areas where, of course, in john kelly's place has retired four-star general, he would be amply well suited to

advise the president on issues like, for example, north korea. a few months ago that was the tone he was raising with me on what at the time was two threats ago, two missile launches ago. take a look. >> almost any provocative action would take u.s. response or anything threatening as launching a weapon on anyone would mean his own certain demise as well as most of this country and the peninsula, what can you say to that? >> well, i think he's calculating kind of person. i mean, from this distance, we can't tell whether he's saying or not. i make my assumption that he's self-centered, but, you know, it's just like in the cold war -- neil: all right, added dimension

and added benefit you get with someone like a john kelly. genuinely a maverick military figure, one who is in the past challenged his bosses and challenged conventional thinking on war in that role of chief of staff as well. added benefit there. we have nod had a general in that role since alexander in the nixon presidency. national security analysts rebecca with us and former state department press officer morgan ortegus. morgan, way too early to tell what kind of freedom john kelly will haven't on monday when sworn in but i imagine first directive is just to establish order, right? >> i certainly hope so. we need it. john kelly, i have the upmost respect for him, i was with him last weekend and he has a real unique way of communicating the president's policy in way that average american can really understand what he's talking

about, so he's got to bring order, listen, he's one of the most respected generals. it's not like he's just any military general. he's a very high-esteemed, prolific career and this is what this white house needs. the leaking has to stop. anthony scaramucci was certainly right about that and there needs to be order and discipline and the president respects which him which is probably the most important things he brings to the table. if president trump doesn't respect what you've done in your creefer, there's not a lot of hope for you. neil: the president has affinity for generals or millionaires or billionaires. you have a very disciplined core of key advisers there with military background. do you think the president is

sending out a signal that if that approach, that discipline approach, he wants to see more of? >> he wants disciplined approach, he wants great minds and great advice and wants to be able to know that he doesn't have a punch of political hacks working for him. they can see america first and not republicans or democrats. that's what the president is looking for. general kelly will try to focus the president's minds on some more serious threats facing the country. this north korea threat is a serious problem. we cannot allow north korea to sit there with a nuclear capable missile that can hold, you know, it used to be hawaii and alaska and california and now test they can reach wisconsin, ohio, pennsylvania, new york and this is not something that general kelly is going to allow president trump, you know, to move away from or forget. he's going focus his mind on the threat and have to deal with it. >> i should say, morgan on a video clip we ran, he

volunteered the north korea information. he volunteered that, you know, concern he had about one tested nukes right after another or missiles right after another, so there is someone who north korea is going to council not just letting the tests keep going on and on. >> absolutely, this president has stated very clearly early in his administration that he set a new policy and that policy is not to pursue containment that the past three presidents or so have pursued, but president trump has equivocally state that had he's not going to allow north korea successfully continue test icbm's, that's really important, neil, because that's a total strategy and shift change from what we have seen. and also keep in mind that who else is watching what we do in north korea, iran. we have seen the space satellite they launched which a lot of people believe violate and iran

is watching closely what we do in north korea, they are looking to see if actions match our rhetoric and rebecca is right that general kelly is very experienced and not going to recommend to the president that we sit by and do nothing and try to contain north korea. what does that mean in that means the credible threat of military force and that could get very messy in the region. certainly complicated when you throw china in the mix. neil: rebecca, one of the things about having somebody like that they focus on the real threats and to morgan's point concern about north korea, concern about iran and he raised it with russia as well, i believe that russia meddled in the last election, it didn't attar -- alter results but did meddle. the one thing to get sense of the general, he will be in

things that matter and not who is cursing out whom, stuff that doesn't. >> he's going to focus on the important things. morgan said, we have waited too long, we have been too patient with north korea. we are going to see some things start to move here. we will increase defensive in the region. barack obama cut missile defense nearly in half for u.s. homeland his first couple of years in office. we might see some cyber activity and try to disable north korea's activity because we don't want to use force but we do have to have a credible threat of force in the region. there are 28,500 american servicemen located in south korea right now and their families. they're at risk and now the american homeland is at risk. general kelly is the right man for the job for president trump. neil: all right, we shall see, rebecca, morgan, thank you. a lot of people say it's all or

nothing when it comes to coverage of donald trump, if you're incline to give all nasty stuff, you do. if you're incline for the president, loving stuff 24/. -- 24/7. if you're ib -- inclined to go after donald trump, ad nauseam, the markets since election. some people say that's just the fluke, nothing to do with donald trump, but will it be up to a chief of stay to say, well, you have to give him some of the credit, that's the type of challenge that faces john kelly, getting the news out, improvement on economy and improvement in the markets even as you're dishing out all of the controversial stuff. 24 hours is plenty of time to do both.

neil: i hear panicking on what's going on with the trump white house and everything going no hell in a ham basking, why would you bet money the other way? why are the markets continuing to go up? why do we have markets hitting records left and right this past week? why are internet stocks storming all-time highs even when they give a little ground? fox news dagen mcdowell and democratic strategists. dagen, why is this happening in an environment that shouldn't? >> that's corporate earnings that is how much money these companies are making. an economy here in the united states that is still growing, low inflation, investors are not worried about higher interest rates. even europe, you have economies around the world that are firing simultaneously which is something that's been lacking in the -- since the financial crisis. i will say one thing though and i want to hear what gary has to

say about this. investors are focused on good news. if that somehow changes it will put more pressure on washington to cut the nonsense. neil: look at some of the media and i don't think he gets a free pass on that but i will say this, gary, this is the quiet, how much of it is built on the assumption they're going to get tax cuts, these guys have been betting on that, liking that or is this beyond that? gary. i think we have trouble there. so i want to get robin's take on that one. >> ly take -- i will take that one. neil: of course, you will. the view from the left is trump's rally. >> the view from the left this is academy can i -- acceptance

of the chaotic presidency. presidency in constant state of chaos and they are ignoring. they already got the regulation that is were put in place to protect the markets from and bring back -- neil: they are running up despite the troubles, you're not going to give them any credit? >> give trump any credit? >> i've given him credit right now for the deregulations but i think are that there's a problem because those were put in place to protect the consumers because of the economic fallout and the real estate bubble. so -- neil: all right. gary, i think robin had clipped your mic. hopefully you got that back. your take on this. >> typical of the left to step all over me when i'm -- neil: exactly. >> killer points. in answer, of course, it's all

obama's credit, i'm sure that's what robin was saying. i would go a different way. i think that the greatest gift that the trump administration could do unknowingly is introduce chaos right from the start. the result is that the average investor now is inoculated to this nonsense. whatever. episode of brady brunch. they are used to it now. back to dagen's point, they are focused on the economy to the extent even if nothing happens, i thought two weeks ago nothing would happen with health care, i'm now thinking nothing will happen with tax reform and i'm retrieving to the position, okay, it's not going to be worse than under obama. there are certainly upside but even -- neil: fighting words, dagen. if he's right and the markets now given up on the prospect of tax cuts as well and then, i don't know.

dagen: maybe not given up, gary b. but certainly with the failure of this senate gop health care bill, i think investors were happy that they weren't going to get obamacare light. the bill that they came up with like let's tax and spend, let's keep the obamacare taxes in place and spend all this money, investors are at least used to obamacare but now that have solidify the fact ta it was going to essentially be there for years to come. neil, i want to say about the past thing really quickly. free pass not for the white house from the media, from investors. investors don't care about the nonsense. neil: we will see

neil: we could have a a revolution on the south of the border. election on sunday where the leader of the country wants to redraft the constitution to make it faster and easier for a lot of prerogatives and a lot of folks not to keen on that. this could get very ugly very fast, steve. >> neil, all signs point to the fact that this is going to get ugly. we could see a real explosion with the country with the world's largest proven reserves of oil in venezuela. what you're talking about is a revolution against democracy. you have a president in charge there. one-time bus driver nickulas -- nicolás maduro and he's trying to rewrite the constitution on what he's calling a vote where you can't really vote no and only vote for the people he elected. the opposition has been out there on the streets for the past four months throwing rocks

at security forces. more than 110 people have died in that fight and all could come to a violent head on sunday. the u.s. is firmly opposed to this vote, the u.s. has already sanctioned 13 top venezuelan officials. they could do more talking about possible swift economic action if this vote does go through. now, the u.s. gets 10% of oil from venezuela, so any oil embargo by the u.s. could really cripple venezuela's economy already reeling. it could be a dramatic move and we are watching what's going to happen there over the next 48 hours, neil, back to you. neil: i want to keep you up to date as well on the president, he's been busy tweeting today and expressing frustration with republicans fail to go come -- failing to come up with health care alternatives saying they are looking like fools, you need at least 60 votes. keep in mind that was not the

issue with the skinny bill that failed, that required simple majority. a lot of the tweets are saying effectively that they are on message, they are very much back to what the president is really to what the president is really angry about and they are

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>> welcome, everybody, i'm neil cavuto. a live edition of% >> welcome, everybody, i'm neil cavuto. a live edition of cost of freedom. marrying main livoset with wall strstt and throw inith little of pennsylvania avenue because those developments would be normaily rerkryi-mov. g eve s if they scared the market. they have not with the latest turopverith wa john kels com. in as the new white house chief of staff, replacing reince priebva. nmenren ly wtheyn y d gollps dg what has been a steady parade now of offic ls thav. g, eil just kicked out on their fanny on their own, let'sllasnkithbout wthe t we'vehiestn inrepelhaive short order here. the national security advisor gene stl fs li witasn days of l james