stuart: we gradually upon up right since the opening bell which is what, about 2 1/2 hours ago. we're now at all-time high for the dow, 22,173 and rising as we speak. let's see if the rally continues with connell mcshane sitting in for neil. the. connell: thank you, stuart. the north koreans threaten to make the u.s., quote, unquote pay for the sanctions. ambassador nikki haley saying the world is on board getting kim jong-un on line. >> basically what you saw all the countries come together saying this has got to stop. this is not something we think can be reckless and casually dealt with. that is what he has done.

they hit him and basically we hit him hard. connell: with that, with those tensions rising we bring in former deputy assistant defense secretary under bush 43 peter brookes. always good to see you, peter. this whole idea of the world getting on board and this win as it is portrayed by nikki haley over the weekend at united nations, how important is it? >> it's a very important. a very important step taken by the trump administration rallying countries like china and russia to come down hard on north korea. we can expect other countries to support us. getting those in line to support sanctions is important. implementation of course will be critical, colin. there is problems with potential leakage. north korea has friends in iran that people help them work around the sanctions. i think it is very important step. i think the u.n. ambassador is correct. win for u.s. mission in new york, the state department

and trump administration to this point. connell: to your point about implementation why should we think china would go along and it is not all talk here? why should we think they will actually follow up on that? >> there could be reputational costs to them if they don't, right? they said this time yes, they didn't veto it. they didn't abstain. they said yes. there will be reputational costs to them, if we call them on it if they don't implement it. we'll have to see in the long term what they actually do. this will take time to become painful for north korea. connell: with all that happening, interesting stuart came over to me, stock market hitting another record high. it has. we're well above 22,000 on the dow. even though tensions are higher with north korea, it seems as if wall street here has been able to ignore that. should they be not paying as much attention as they not appear to be to this? how serious is the situation right now with north korea in your own estimation?

>> well it is very serious. obviously last month they had two intercontinental ballistic missile tests. they say they can cover more of the united states than they could previously. previously a alaska and west coast. now they're saying into the heartland, maybe as far as east as the west coast. it is very serious situation but we're not going to war with them tomorrow. we have to get them to stop nuclear testing and of ballistic missile programs. everybody likes to see stability and we like to see that on the korean peninsula and asia. if there is instability it will have other sort of effects, financial, humanitarian, political. there are some possibles out there, getting out there stability on korea, japan, south korea, taiwan, russia, major economic powers is critically important. connell: if these sanctions don't work, i mean if they don't

comply, if there are more missile tests, i know we hear the phrase, i don't know if it is throwaway phrase or not, we hear all options are on the table. are they really? is it preemptive strike by the united states against the north koreans really a viable option? >> of course we want to use all tool kits in our tool kit, right? economic sanctions is one of them. this could, these actions or punitive sanctions could drive north korea to the bargaining table, right? you could bring in diplomacy in that case. there is always deterrents, military deterrents, conventional military deterrents. we need to work more on missile defense. we need to be in good stead with our allies in south korea and japan, work with those whose interests may not exactly align with us, russia and china. we have to use all the too to increase pressure on north korea, not only stop what they're doing, hopefully, this will be a real challenge, try to roll back those nuclear and ballistic missile programs.

connell: your point on nuclear defense, final question, peter, what do you know about our capabilities there? is there any true concern they could sneak one through? >> that is always a concern. no withs system works 100% of the time. i don't care if it's a simple pistole. this is one of the real challenges. you're hitting with a bullet with a bullet in space when hitting a missile with a ball ball missile. if they increase the arsenal and up our game as well and we have to continue to improve our capabilities what north korea may present us with. connell: good to always see you, peter, thanks for starting things off. the president is tweeting about this, what he calls progress with north korea as he is working on vacation in bedminister, new jersey. there is media pile-on with the

president with all the headlines, so much for working vacation. he is not working at all. is that fair? "washington examiner," white house correspondent joins us and fox news contributor rachel campos duffy is with us as well. start with you, gabby on that. every president take as quote, unquote working a vacation. is this president any different? not type of job even if you go to say hawaii or martha's vineyard that the job leaves you, right. >> no, absolutely not. every president before donald trump and now himself is, in constant contact with his chief of staff, with members of his cabinet, taking meetings, holding briefings. this is a working vacation. not as though he is just out on the golf course completely ignoring crises that the united states faces right now. in fact he is holding a briefing later this afternoon with secretary price, health and human services to discuss the nation's opioid epidemic.

so, you know, we do know that he is getting work done. he is consulting with his secretary of state, working with his chief of staff and several other advisors to determine what to do to handle north korea's aggression and it is certainly not a vacation in the simplest terms. connell: what is different about this president, rachel, morning habits, whether he is on vacation or at white house. he watches television. makes comments what he sees on tv. back and forth with senator blumenthal yesterday, that leads headlines to people that all he is doing is tweeting and not really working. what do you say? >> not fair. he tweets and he is somebody that likes to speak his mind. let's be clear. he is a billionaire businessman. he has been working on vacation for a long time. this is not a community organizer president who knows how to relax a little more.

he is not only one working. his cabinet is working. i'm here in rural wisconsin last week. secretaryperdue was in our town talking about farm issues, talking about modernizing the infrastructure with world broadband. you see what nicky hallly is doing. the media is giving him a bum rap. you look at war on isis, one of the most important issues we have, we're seeing dramatic advances on isis. more in six months we probably saw of eight years of a president who said it was a jv team. i think the media is not being fair on this one. connell: i wonder if there is going to be more focus in the coming weeks? that is something we heard a lot about when john kelly took over as chief of staff and reince priebus was leaving, what you do you think of that, gabby? that the kelly era would have a president not necessarily stop tweeting, neil talked about it, will not stop tweeting that is good weapon whether in the

morning or afternoon? he is focused what he wants to get done? maybe today north korea or tax reform but not getting off on a tangent, boeing back and forth with some senator. is that fair? >> there was a lot of information out there when president trump fired reince priebus and hired john kelly as his chief of staff about the influence and impact kelly would have on the president's twitter habits. a lot of people said, oh, he is going to be able to regulate them, to rein in the president on twitter, in fact sources in the white house say that was never the goal of kelly. his primary goal to insure that the tension between staff and the white house is addressed and that the president is not being fed misinformation. but he is not there to monitor and stand over the shoulder of the president every single time he decides to tweet something. so i think that that was kind of created this misconception to begin with. i do think that kelly is trying to emphasize the work of the president is doing to address international crises, to work

with members of congress on legislative items that are coming up like tax reform, like the debt ceiling and a budget bill. so i think that will be the focus. you know going back to rachel's point earlier, president trump hasn't even mentioned in long before he ran for president he has never been a fan of taking vacations, of you putting down his phone. connell: right. that is another reason people are hitting him hard. you always said you didn't want to take a vacation. >> right. just something to know. connell: what about that point though, rachel, about focus? about say next week would be a decent time or later this week, while you're on vacation hit tax reform, set parameters of the debate? say, every day, a few tweets a few statements, whatever it is you're controlling the message, not getting off message? >> sure, there is nothing wrong with kelly or anyone else on his staff advising him to be a little more focused on his

twitter but let's be clear. the president speaks his mind. he is authentic. people like that. it connects to people. folks that want to give up twitter is the media. media knows he sets the narrative with his tweets. sometimes it's a little off message but a lot of time it is hitting them. when he talks about things the media is not talking about, that shows how unfair they are, further undermineds the credibility of the media, something frankly we haven't seen in a long time. they have gotten a pass and finally, there is a republican president who is holding them to task. connell: i get it. there is polling by the way some of his fans would even like to see little less tweeting and little more focused tweeting. gabby, rachel, thanks to both of you. we'll take the google story here in a few minutes, a big story on the firing of a software enbeer in the company and was fired for criticizing some diversity initiatives. so free speech debate, and debate over women in the

technology industry. so we'll try to figure out what the real issue is here. we'll have our own debate coming up next. ♪ ♪ ♪ ♪ ♪ ♪

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connell: google fires an employee jamessed james demoore. that he claimed that the company harmed -- he wrote a 10-page memo. in the memo he asked the company to do number of things, to demoralize diversity. stop alienating conservatives. stop restricting programs to specific genders and races and have an open and honest discussion about the program costs and benefits for these types of things. he is considering action against google. we have dineen borelli. big story especially after the firing. let me start with you? did he deserve to be fired? >> it's a private company. they can do whatever they want. google needs to do a search engine to find out what diverse really means. how ironic, the diversity

department, so-called diversity department doesn't want to hear about difference of opinion, difference of thought. what this guy did he proved his point in terms you how google does not want to hear about idealogical differences. connell: interesting, christie, the judge will be on next hour. i will ask him about all the legal back and forth. i don't know, i can see, certainly see dineen's point to the, tent even if you disagree with what the guy said, that is nonsense, that women wouldn't be as effectively as men working at google or anywhere else, didn't he have the right to say it? is this a discussion we can't have? what is your take on the story? >> i think his comments were problematic for couple reasons. connell: okay. >> one he created a hostile work environment for the women who already work there. think about it. you know that your coworker now thinks that 1/3 of your coworkers essentially all the women, are not as well-equipped to do their jobs. what woman would want to be on a team with this guy? what woman would want to work tore him? or heaven forbid, would want to

manage the guy always he will be second-guessing you because he believes you're not inherently able to do your job. connell: are you saying that is racist comment? >> i think those are parallels. that is the first problem. the second problem i see, it hurts their recruitment efforts. for same reason, why would you want to be a woman go to work at a place where you you have to assume his attitude is if not pervasive or the majority opinion? there is, tech has a real problem right now. connell: tech has a problem just in number of men versus number of women, right? speaking of diversity programs. there is far more men in that industry. what you do you say to that, dineen? how do you counter that? >> people should be hired based on their skills. has nothing to do with sex or nothing to do with race. i don't agree with all the points this guy made, stifling of independent think, independent thought, i have an issue with that. if you go into this environment, you know this first-hand --

connell: christie's point about hostile work environment? if somebody said this, you were working there as a woman would you feel uncomfortable some you how the environment had been altered? >> working in anywhere, in any environment, individuals need to be aware of what they are up against. i can't see how this can be a hostile work environment. again, i think this goes back to google -- connell: comfortable working next to the guy. >> it is his opinion. that is his opinion. if you have the wherewithal to rise above that, and do your job and do what you're being paid to do which is provide results, and provide your talent to whatever industry it is, that is what the bottom line. connell: christie, you wouldn't, if this guy has a opinion, basically biologically men are somehow superior technologywise to women you would say i don't want to have my desk next to this guy? >> look, freedom of speech, doesn't mean freedom from consequences. obviously the company is a private company, has every right

to say we think that his words are damaging. what i want to be on a team with this guy? probably not honestly. but he is also wrong on the merits which is that, yeah to be a good, to be a good engineer you certainly have to have the it being savvy to you know, but that is actually a fairly low level bar. the higher bar is actually understanding how to solve problems and whatever and these are i would think a lot of people uninherrently more female skills actually, soft skills rather than hard skill. >> doesn't matter a perp's sex or race. come on. what skills are you bringing to the table to achieve the goal. that is the bottom line. that is what we should be focusing on. >> to make any company work you need to work collaboratively. >> what a person is thinking or not thinking. connell: that is the debate. >> i don't think that is hostile. connell: that is the debate. i will ask the judge specifically about the hostile work environment.

chris and deneen thanks. judge napolitano will give legal expertise on the google case next hour. aftermath of the tarmac meeting. infamous loretta lynch tarmac meeting and why conservatives are calling this new development something of a bombshell. the hbo hack story, the hackers are back and using "game of thrones" as ran some. details on that as well -- ransom. >> in the winter. potsch: you each drive a ford pickup, right?

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connell: time to talk about the tarmac meeting believe it or not is still raising questions. blake burman joins us now, new details about the former attorney general loretta lynch. what are we learning, blake? >> reporter: here we are a year plus later, connell, and this is a story comes v. you yaw conservative watchdog group "judicial watch" and american center for law and justice. they have obtained. mails that show former attorney

general loretta lynch was communicating, writing emails with an alias, that alias being elizabeth carlisle. those emails show essentially the communications back and forth between members of the department of justice including loretta lynch herself at one point basically the pr crisis with all of this, this tarmac meeting in, of last year was unfolding in which lynch was on the tarmac there in arizona, met with bill clinton while clinton's wife, hillary clinton was under investigation. lynch's attorney told us in a statement a little while ago essentially that she did nothing out of the norm. however critics question the transparency in all of this. here is the statement from lynch's attorney to fox business a little while ago, and i quote, not unlike prior attorneys general and other cabinet officials former attorney general lynch did not use her given name in the handle of her government email address. her address was well-known to the individual who processed

foia requests, freedom of information act, and her emails were regularly produced albeit with her exact address redacted. eric holder had pseudonyms as well for all the sports fans, you probably recognize this one, at one point he went with the pseudonym, lew alcindor, the nod to the former basketball great. what you have here, connell, attorney for loretta lynch hey look, this was standard practice. this is what people in the position of loretta lynch did. however now you also have critics saying well this was a meeting that was highly questionable, highly skeptical to begin with. now you have notice of emails which loretta lynch was not using her own name. connell: i didn't know they did that with their government addresses to be honest. that is kind of interesting. blake burman still checks into the hotels under name peter barnes which is a little odd. thank you, blake. this hbo story, this hbo

hack is taking a turn for the worse. hackers are demanding a big-time payday. they want to get paid. bring in hillary vaughn for latest on that. what is the latest, hillary? >> hey, connell, the latest we finally know what they want. you're right, they want a big payday out of this entire leak. in a ransom note the hackers demand hbo pay them $6 million in bitcoin or they say the leaks won't stop. the cyber thieves justify the seven-figure sum writing in their quote, hbo spends 12 million for market research and five million for "game of thrones" advertisement. consider this another budget for ads. if they don't pay up, fans are in for a lot of spoilers. they published preview of "game of thrones" episode airing this weekend a still images and plot summary. they released scriptses for the last four episodes. this latest dump goes deeper

than show sneak peeks. ordering the verge, one leaked document has personal phone numbers, home addresses, emails for entire season 7 games of thrown cast, including peter dinklage and emil you yaw clarke. they didn't not just siphon from the show but have company secrets. they got away with thousands of emails from company executives including confidential documents. connell? connell: that is the thing, emails, people don't want to look at those, or have other people looking at them. hillary, thanks. we'll stay on top of the story, the hbo story. tesla meantime enjoying early success with the model 3. it has a lot of attention, receiving deposits from more than 500,000 orders. however jenny beth martin joins us, tea party patriots to talk about elon musk a little bit and success of mr. musk coming at the price of big-time government subsidies, right? that has you, and some others i would say over the years you upset.

they say this guy, gets a lot of credit for you all his ideas but he couldn't be able to carry many of them out if the government didn't help him out, right? >> that's correct. thanks so much for having me, connell. elon musk, i wish him great success with the new model 3. i hope he has so much success and profit he can quit taking money from the taxpayers. each one of cars, for first 200,000 cars, purchaser get as $500 rebate. two years ago there was a study that the "l.a. times" did, showed he already received for three of his companies 4.9 billion, that is 4.9 billion, 4.9 billion, with a "b," dollars from the government in taxpayer subsidies. that is a lot of money. time for him to get off the government subsidies. connell: let me try to play devil's advocate. he is a big-time inknow vator, whatever you think of elon musk and personal opinion of him.

we could talk about tesla or have a conversation about spacex or get into the hyperloop technology which gotten so much attention over last month or two. he is big-time innovator, right? is there ever a time when it makes sense for a government or our government to invest in technology that wouldn't ordinarily take off if it didn't help out in the beginning does that make sense in your view. >> perhaps it does, he has orders for 500,000 cars. connell: right. >> most of the people who purchased the other two versions of the car have six figure incomes. average for the first car was $500,000. average household income for the second car was over $200,000. these are people who don't need $7500 rebate. connell: i get, subsidizing someone buying, you're buying a car for 100 grand. if you're even thinking about that, do you really need the subsidy? but you know, if you just look

at the technology, maybe that is the point to some degree that it is now at a point where he gets off the government subsidy but the idea that he he needed it in the first place and that it is reached this point, maybe it was a good idea, i guess that is what i'm saying? we got him to this point. is it good idea in the first place? >> i'm not here really debating whether it was a good idea. connell: it is time to go. >> i believe in free markets. when the government gets this involved it core you rapts and warps the doctor corrupts and warps the entire playing field. other companies might be innovative they might not get the same advantage tesla is getting. connell: i know. >> that is not fair. so, i think it is time to get off. i'm not here going, okay, how dare they do all this in the past, the past is over but we're looking 500,000 orders. i hope he is very successful so we don't have to keep doing this. connell: right, that he doesn't need government money anymore.

take the other idea, he is not only one doing it, they will put tunnels in the ground, got to new york and d.c. in 25 minutes, musk is talking about the biggest problem with cost. i forget the exact number, billions of dollars per mile. whatever it is. it would add up to big-time costs. should we stay away from that? if it never makes sense costwise it never gets done? >> if he wants to do it, he can go and do it but it is not something that we necessarily have to do. we have amtrak that runs through that is paid for by the government. even that, they can't even make, amtrak can't make a profit. connell: i know. >> so they need to be able to make profits with what they're doing. and that is part of what is, what the free market is b you go, you get an idea. you test it out. you invest in it. and -- connell: if there is demand for it. >> yeah.

there will be demand for it and people get it. without that demand, perhaps your idea wasn't such a great idea, or wasn't an idea people were willing to buy. you could have the greatest idea in the world but if nobody is buying it or priced it where people can't buy it is not going to work and the government shouldn't be picking winners an losers. connell: we all want the hyper thing to work by the way because amtrak, even on the acela. jenny beth martin. good discussion. gop has not followed through on health care promises right. they didn't get anything done. what about suing because of it? there is one big-time republican donor trying to do that we'll talk about after a quick break.

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♪ connell: so republicans on recess. no health care or tax reform getting done at this point. the big-time gop donor says

republicans raised a lot of money on empty promises. so he is disappointed and that quite seems natural. here is what's interesting. he you suing trying to get his money back. take a listen. >> so you're suing? >> that's correct. >> kind of a dramatic move. >> we have no choice. i mean the republicans are not serious about repealing obamacare. they are so split, nothing they have put on the table touches obamacare. >> what is your final message here for gop leaders right now? >> if i win you have a choice, you will have to do what you promised, you you have to repeal the obamacare as in the stimulus act. you will have to provide the alternatives, or, you can give back the money, which is as much as $735 million. connell: whoa. bring larry sabato in, university of virginia center for politics. he of course is the director there. i'm thinking if this guy has

grounds for a lawsuit, just about every politician would be broke who don't keep campaign promises but kind of an interesting take, right? what do you think? >> there are a lot of politicians shaking their heads, are you kidding, i have to do what i say? [laughter]. if i were that gentleman i would not go taking out any additional mortgages or spending the money in any way. i think it is highly unlikely he will win the suit but i don't think that is why he filed it necessarily. he filed it to make a point and his point is valid. republicans ran for elections over seven years with the fundamental promise they were going to either repeal obamacare or repeal and replace obamacare and they haven't. the reason he won't win his lawsuit is, there was no binding contract. connell: correct. >> i doubt there is a judge in the country who wouldn't say, you would have to be pretty naive to rely on politicians promises. so he is not going to win the lawsuit but he will make a point. connell: he is filing the

lawsuit, he already has won. he has you and i talking about it, to get attention and bring attention to his point which does bring up, maybe at least one or maybe more larger points which is they haven't got anything done big time. they haven't gotten health care through. who knows whether they get tax reform you through. who will get blamed for that? the knee-jerk answer would be republicans in congress but obviously the president at some point, which side will get more blame, is it the legislative or the executive side from what you're picking up? >> i think both will end up being blamed, but of course our assumption they won't get tax reform done or even -- it is unlikely now, but we've all seen mitch mcconnell perform these end of congress wonders from time to time. i wouldn't rule out the possibility of something coming back on health care. so, you know, we're only what, seven month in, seven 1/2 months in to the new congress and the, we've got 15 months to run in this congress.

so a lot's going to happen you about the gentleman's point is well-taken. after you will, when you make a fundamental promise, that you break it, you pay for it. i'm always reminded of a guy i liked a lot, president george h.w. bush, who got punished president severely at the polls in '88, read my lips, no new taxes, so in 1992 he broke that promise in the early 90s. connell: what is the problem this time? is it just order or went to tax cuts first or got something through, could have got a little bit of momentum, to the earlier point come back to health care? instead of coming back they would go to it for the first time, do you think they got hit going in the wrong order, do you think. >> possibly. it is more difficulties to tax cuts, tax reform if you don't know what the budget looks likes. you can't know what the budget

looks like until you know what obamacare looks like. there are reasons, better to start with something else, maybe infrastructure. even that is constrained what is the in budget. connell: there is talk during the transition somehow the president would work with chuck schumer, now that seems like, you almost said that out loud, am i out of my mind? don't look like there is any chance of working that out. back then there was talk that two new york guys working on infrastructure. probably not. >> you never want to say never with congress. strange things happen, there is more than santa claus going around in the dark of night in the halls of congress. you never know what they're really doing until the morning. connell: you're right. even this week the whole political story, like yesterday i think we talked about right at the top of the show yesterday there was all this talk about the president being primaried, possibly even by his own sitting vice president, which obviously was pushed back on hard by the vice president, but just the

idea that john kasich or somebody would run against him, seems assumption he is very, very weak, he is down in the polls, he is one-termer but you do never know even on something like that, because you know, october of last year, or even after access hollywood, a whole number of times we would said he never would be president and he was, maybe with that we're ahead of ourselves? >> of course we're ahead of ourselves. it is 2017. the election is in 2020. doesn't even start until january of 2020. this is a time for wild speculation. that's what we're doing. it is okay, but it is not worth anything. connell: not even a lawsuit. that is a pretty funny lawsuit, that the guy, every politician would just look at that, boy, campaign promises, you can't make them. good to see you, larry. thanks for coming on. >> nice to see you. thanks so much. connell: republicans we're talking about what they have not gotten done whether it is health care or taxes but on the subject of health care is your employee about to pass down costs to you?

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♪ connell: we do have news today on health care. this is a news flash of sorts. you could be paying more for it. employer health care costs are

expected to rise next year, surprise, surprise. from the fox business network, gerri willis in the newsroom today with the details. tell us about it, gerri. >> the cost of your health plan at work is set to soar in 2018 according to a new study. large employers say cost of health care plans will grow 5%, to average cost of get this, more than $14,000 per employee. that makes fifth year in a row that costs have voicen 5%. that pales in comparison with the hikes expected for people in obamacare exchanges where double-digit increases are common. employer sponsored care is higher because of high cost specialty drugs and individuals with high medical costs according to survey. your share will likely be $4400 in premiums, out-of-pocket costs and contributions to health savings accounts but the majority of that tab gets picked up by your employer who

shoulders 70% of costs. companies are battling higher costs allowing patients to videoconference with doctors. more employers are opening their own on site health centers. there is push toward health plans that rewarded workers for actively managing their chronic diseases. connell. connell: 14,000 per employee. >> a lot of money. connell: depending how many you have. yesterday we were talking, reported on this anthem story, how the company will be pulling out of nevada's exchange following ohio, wisconsin, indiana and smaller presence that they had in california and georgia. so, to follow up on that, former health and human services deputy secretary joins us. good to see you, tevi. brings up more questions what happens if the exchanges crumble. the president saying obamacare collapses or is already collapsing but what does all that look like? >> thanks, connell. the issue here is that people are having more hikes.

it is getting more and more expensive and fewer and fewer choices so that is a problem. i don't know if that means collapse. what we have in a government program, as long as the government continues to print money the program will exist. not like a private sector company that goes out of business. it is clearly inefficient. in contrast to what gerri is saying a minute ago, employers are taking steps to reduce costs with on settle health clinics and telemedicine where the government-run plans don't have those cost breaks put on them. connell: puts into debate whether incentive will be there to actually get this fixed. that is the government will step in to do something. health care failed first round obviously in congress. they have to go back at some point whether now or after tax reform when they have more of an incentive to do it and try to fix it and i guess that's why i started whether or not they would collapse, that would be

the incentive, right? things are a mess. that is what the president keeps saying. we won't get to that point or it will take a long time? >> i don't think there is point of actual collapse. united states government may go default or reach bankruptcy in 15 or 20 years, i don't think we're looking at collapse of a health care program per se. higher costs and fewer choices connell, is not good. you said the first round failed. i would say the first round of affordable care act in 2009 was done partisan way. this is the second round, didn't succeed. also done in partisan way. i think long term we need bipartisan solution so that both parties have buy-in, they're not constantly sniping the a whoo the result is. connell: theoretically, that is right. everybody would love to see that. but in the current political environment seems unlikely, right? so what would the short-term fix be would there be, instead of costs going up, choices going down we're able to stablize things? is there any way to do that short term? >> short term the trump

administration needs to work with the states on so-called 1332 waivers. they give additional flexibility to the states in terms how they set up their exchanges and medicare waivers to give states more flexibility on medicaid systems. these are the margins. without legislation there is a limit how much can be done there. long-term they need some kind of bipartisan piece of legislation. you would need much-pass legislation like children's health insurance in sent or action-forcing event. not necessarily a collapse of the markets, but unsustainability of the markets makes congress realize they have to do something because people can't afford the aca plans. connell: that is what i was asking about before. what would that look like? is there a timetable own that a few months out or number of years out do you think where we would be at that point, we would say, boy, we have got to do something here? >> hard to say. each year the situation appears to get worse with fewer choices and higher costs.

for the lowest income people on exchanges, their plans are subsidized. so the government is paying for how much the costs are so it masks the true costs. if you're not in employer-sponsored care, trying to buy a plan through the exchange and your income is too high to be subsidized, that is unworkable market for those people. connell: we, for example, here, where i work, where many other people work you are on employer sponsored care, right? so the numbers overall in country of 300 plus million are not as high. so you don't, maybe have the groundswell. i know there is a lot of grassroots organizations and a lot of money put behind it, just more people, raw numbers, there would be more demand for action, do you think? >> yes, but you made a good point, 177 million people get their health care through employers. connell: right. >> employees and their dependents. it is that stability in the system, because most of the people get their health care through employers.

most of those people are happy with the health care they're getting. that stability in the system sustains the system. it staves off some of these terrible collapse type scenarios you're talking about. it is really the employer system in many ways propping up the rest of the system. connell: it really is, that prevents us from having incentive to act, not that we necessarily don't because for some other people these costs are going up and to your point the choices are going down. good to see you, thanks for the talk and discussion. we appreciate it. we want to check the markets real quick with the s&p 500 on pace for another record. if it hits it would be 30th under president trump, 30th record close. 10 trading sessions in a row, likes of apple and goldman sachs and jpmorgan have been leading the way today. apple and jpmorgan actually hitting new highs as you see some of the heat map there on the dow. there is more green than red. we're up 21. when we return this big hour

we have straight ahead on "coast to coast," we'll include more talk about the trump administration you putting pressure on korea. we'll talk about china's brand new response to that. details on tax reform from charlie gasparino, he will tell us why the house and senate may not be on the same page which may have big time ramifications. you all that and more straight ahead. ♪ ..

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charles: welcome to our two of cavuto coast-to-coast. we have brand-new details on north korea, how bad this north korean threat really is losing reported out that says north korea has produced a miniaturized nuclear warheads that can fit inside its missiles. those are frightening develops to add on top of the other developments we had. we start this our bringing in from the national interest director of studies who is with us along with former cia military analyst tara miller. good to see both of you. the newest development on top of a number of other developments that lead us to believe tensions have spiked with north korea but this is kind of a technological development. what do you make of it? >> today at 12:22 when the washington post story broke we can declare north korea a nuclear power blues not only a

nuclear power but a power that can hit the united states with an intercontinental ballistic missile. the report also says north korea has 12 to 20 nuclear weapons like we have been saying for a long time but 60 nuclear weapons. these are game changing revelations we have to be concerned about. the biggest take away, we are out of time to stop north korea from getting a nuclear weapon and that is a sad day. connell: if we are declaring in the last hour that north korea is officially a nuclear power the stock market would be down. it is off of the highs but we still have 18 on the dow. we keep sending record highs on wall street no matter what which is interesting though off the subject. how important do you think this development is? this washington post report, he thinks it is official, north korea is a nuclear power.

>> it is important, a significant development that begs the question they might have a miniaturized device but don't know if they have capability to marriott with an intercontinental ballistic missile. we have seen her missile launch is going up dramatically since the trump administration came to office so you are seeing not just the quantity increase but a significant what you would say like a quality increase as well because they might have the capability to have nuclear material that can be put on a missile which is obviously a major concern for the united states. having said that, we are in the same place, a bad place optionwise. what are the options we have here? we are trying to chokehold them with more sanctions, we will see if china and russia comply with the sanctions passed by the un and if the sanctions don't modify the behavior we are going to need to get the north koreans to the table and we will need to start to do some high-level

diplomacy and we will need to start looking outside the box, if any deal negotiation strategy can be made go north koreans are now willing to sit down and that is a big problem. sanctions are important, let alone change north korea. connell: china, your point is well taken, china goes along, russia goes along, after they voted they said they would, the united nations, then we tried diplomacy and they don't want to sit down and talk. then where are you? to talk to most experts on this area most people say a preemptive military strike doesn't make sense because what if this guy is backed into a corner and uses this technology he reportedly has? >> all the bombs in the world won't's all the north korean problem. if north korea does have 60 nuclear weapons you would need a

massive military strike to take out all 60 of these weapons. the north koreans are good at hiding things in caves. connell: you just miss one, a terrible hypothetical, you miss one, forget about it. >> you will see seoul or tokyo, millions of people die. the military option is not one we can entertain. connell: what is the best option? >> we have to go back and look at history, look at the cold war. we know how to deter countries that have nuclear weapons, we have better missile defenses than we ever have, we need to search those into south korea, we need to tell the north koreans if you ever think about launching a nuclear weapon at one of our allies your country is going to become a nuclear parking lot. they will get the message loud and clear. connell: to blame as he does play into this. this role in china the chinese saying they will face the fallout from sanctions to stop

this north korean threat, will they, to your earlier point, follow through on this? i don't know if history is any guide but what will be the next move from the chinese? >> this was a really significant sanctions package, we got russia and china on board, having said that passing the resolution is one part of the equation. this is a huge sanctions bill, china might be partially compliant with, we have to wait and see. we have to see what happens. that will take time to see. we don't have that time. i agree with the previous point about a deterrence strategy. we had successful deterrent strategies before with regards to nuclear weapons not being used. that puts aside the question, can we get them to the table? is there a way to get them to give up their program? we have been able to get states to give up their nuclear weapons program. it is not unheard of as we have done it before. in the earlier 6 party talks we

got them to temporarily halt their programs and there were difficulties as talks broke down and they resumed. it is not impossible but now the climate is not such a theme willing to do so. it will take good diplomacy, multilateral diplomacy out of the state department and secretary of state tillerson, japanese and chinese and russians put the pressure on and get north korea to the table and that might mean in a short-term making some short-term, it is not appeasement but short-term -- connell: given a little bit on our side. >> doesn't mean you give in permanently but that is the nature of diplomacy. connell: if you are dealing with rational actors. i think even -- with any understanding of history, there

was -- even with the soviet union getting as close as we got to the brink of nuclear war and everything else wasn't that more of a rational actor situation than this one is? >> a lot of times we talk about kim jong un as a crazy person but he has people in prison came to the international communities against them, that is why he has nuclear weapons and is more than likely not going to give them up. he knows there is no way to fight with the united states he is ever going to win unless he has nuclear weapons that put millions of people at risk. connell: to repeat the breaking report, according to the washington post he has a miniaturized nuclear warhead that can fit inside a missile. there you go, that is where we are. good to see both of you. the president has been focused on what we have been talking about, north korea, getting ready to address another topic on the domestic front, the nation's opioid crisis. that event is later in new

jersey, adam shapiro traveling with the president, not right to the golf course but nearby bridgewater, new jersey, the latest on this event. adam: the opioid crisis in the united states was one of the issues that held of health reform and different senators from states with large opioid addiction problems. the president tweeted about the event at 3:00 and here's what he said, quote, i will be holding a major briefing on the opioid crisis, a major problem for our country today at 3:00 pm in bedminster, new jersey. attending this briefing will be secretary of health and human services secretary tom price and the president authorized his commission on drug addiction and the opioid crisis and they delivered an interim report and i want to give you key points

and recommendations, 142 of our fellow citizens die every day from a drug overdose. it has killed more people than guns, homicide and car crashes and two third the drug overdoses are linked to opioids, some of the recommendations from the commission increased treatment capacity, to do that through the medicaid program. mandate prescriber education educating doctors, these opioids -- enforcing mental health insurance coverage, people who might have a drug addiction because they had overwhelming correspondence between drug addiction and mental health issues have the same insurance coverage for physical ailments. that is coming up at 3:00, liz claman is going to be monitoring the briefing and full coverage of it if it goes live.

adam: the president in new jersey today. connell: we moved into breaking news mode this hour with the north korea story. the opioid crisis coming in just a moment charlie gasparino will be here with news of his own on tax reform. a new battle brewing and charlie is next on that.

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with liberty mutual new car replacement™, you won't have to worry about replacing your car because you'll get the full value back including depreciation. switch and you could save $782 on home and auto insurance. call for a free quote today. liberty stands with you™. liberty mutual insurance. connell: new info on taxes. republican house and senate leaders may not be on the same pages when it comes to whether tax reform needs to be revenue neutral. charlie gasparino is here with details on this. charles: this is a moving target. we are getting this from the white house, some congressional sources. at least the impression they are

getting from mitch mcconnell is he is softening himself, softening on the necessity and conditions that it needs to be revenue neutral, closing of loopholes. connell: goes for a tax cut. charles: he is starting to soften on that condition. we should point out mitch mcconnell did not comment on this. they referred to statements where he said it must be revenue neutral but we are getting this from our sources in the white house, the trump white house, congressional sources, he is starting to soften on that. what that means i cannot tell you. if it is not revenue neutral, you might need democratic votes, you have 60 so you can avoid the filibuster. connell: won't want that getting out because the negotiations -- charles: the white house is dealing with the senate and the house and we should point out

kevin brady, house ways and means chairman, house speaker paul ryan, remain steadfastly they want this to be revenue neutral at least as they are now but we are seeing cracks in it but how that plays out your next guest can tell you how the dynamic works from there negotiating tax bills, doesn't have to be revenue neutral and whether mcconnell does cave on this. connell: one other question about this. i can see where you are going with mitch mcconnell considering, he is softening but paul ryan moving in that direction because of how he feels. charles: he has this convoluted

republican majority. connell: the raucous caucus. charles: the freedom caucus are supply-side oriented, believe in tax cuts to grow the economy and produce reduced deficit in the long run so he has a coalition he has to hold together on his own, who knows what happened in the end, this -- the founding fathers created this mess so things didn't change fast or they did when they did change it changed after negotiation. connell: you are blaming alexander hamilton. charles: the whole crew, they gave us the system but it works better than anything else. >> congressman their life and joined us now and charlie will hang around, thank you for coming on. we can continue this conversation. what is your biggest priority? tax reform is the big deal, what viewers want to see get done. i use the term tax reform as opposed to tax cuts but what is your biggest priority?

cutting taxes are making sure this whole thing is paid for? >> it is both. revenue neutral can be defined in two ways. one is for every dollar somebody pays less in taxonomy pays more in tax. i call that the winner/loser phenomenon. then you hope you grow the economy. the second one is you make changes in the tax code that might cost you revenue in the short run that cause the economy to grow faster and you get more revenue. that is the win/win scenario. the latter is where most of us that work on the outside our. which is it is not per se a cut that it is in fact one that the cuts have to be designed to grow the economy such as reducing corporate tax and causing investment to come to the united states the stranded overseas. connell: charlie has a few questions for you. i want to follow up.

it sounds to me as opposed to something that would be traditionally revenue neutral you are open to cutting taxes and having economic growth pay for those tax cuts. >> not only am i saying it but the american people understand they cannot trust congress to basically do something revenue neutral because if you do it in current dollars revenue neutral we are saying we will get together and figure out winners and losers and for everyone that gets a tax cut somebody else is going to get stuck. that is one of those things where you don't want to have a discussion of who has more power to lobby to get a cut at someone else's expense. that doesn't make a lot of sense, historically the tax cut that have grown the economy, the kennedy tax cut, the reagan tax cut, they were not currently revenue neutral but they grew the economy and more money came in. connell: you heard my report

before about mitch mcconnell softening on this. what do you hear out of the senate? is he truly softening? does he by the way you look at revenue neutrality? a lot of supply-siders with good revenue neutrality? >> he buys the fact that if we can convince cbo and other outside neutral groups to score likely economic growth and that gives us in the ten your window more revenue, then it is revenue neutral. i don't want to correct you for what you said but my understanding is if it is revenue neutral in that 10 year window it is compliant with this arcane process where we don't need 60 votes and that is important. you could correct me anytime on parliamentary procedures but that is interesting. if it is not, basically you only need 51 votes even if it is not

traditionally revenue neutral theoretically. >> the rate reconciliation was written it has to be revenue neutral, revenue neutral in a ten your window, economic growth can be in there and we can interpret, that is a to the senate because the house has made its decision but the senate would have to make its decision into the bird rule that this is compliant. obviously you got to ask the parliamentarian, the senators, i probably americans when they win/win out of tax reform. they don't want a win/lose out of tax reform and that is the difference between doing and not doing it. charles: is mcconnell on board with your version of revenue neutrality? >> a lot of former house members are on board. ultimately mcconnell has to reflect his caucus and his caucus wants to see a reaganesque, kennedy-esque type of grow the economy and if that is the goal i hope some

democrats, joe mention and others will get on board too because i don't want it to just be 51 votes. i wanted to be america getting something that will grow the economy. connell: where do we get the best bang for our buck and the most likely outcome? your background his business, is in on the corporate side of the individual? how do you see this playing out? >> i go back to the investment tax credits reagan used and recognize any you do that tells corporate america and noncorporate america, mom and pop stores, that they will be rewarded for investment makes a real difference. as we shift from our current tax policy, we tax you on profits rather than distributions after profits, any kind of change along that line, lowering the

corporate tax rate while maintaining their distributions are taxed could be helpful not just in the so-called secor but the a score and limited partnership. those incentives give you growth in the 10 year window. connell: i don't have to remind you, you are in a high tax state. there are some i guess deductions that are singled out to be ended in the trump plan, the senate and house talking about this as well, state and local taxes, something even republican new yorkers want to keep in any bill, do you think that survives this tax plan. >> it may be too big to get past but let me tell you something, we have a system in which some things are deductible and others aren't. if you are in a state like mine with i sales-tax and 13% income

tax you find yourself in the amt meaning you cannot deduct your state income taxes against your federal and federal is at 42 for somebody like me so the reality is the system is broken. we should address the so-called amt we are always twiddling with and we should ask once and for all, is it up to the federal government to allow a deduction for what states spends or should they be completely separate? i am willing to look at completely separate, state decisions different from federal decisions or federal government subsidizing state taxation systems. connell: we will see you when you get back to washington. good stuff. senator mcconnell. and speaker. this big story, google are firing this employee, the engineer, male employee wrote a memo questioning women's role in the technology industry.

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connell: google firing this employee, suggesting men i better suited for technology jobs than women. google said that violated company policy and he has been fired. judge andrew napolitano, talking about it last hour. one of the points that was made was this guy created a hostile work environment, but writing this memo, wouldn't want to look at this. judge napolitano: there is a lot of psychobabble in their, deep syria, use of words we don't all

use all the time. he is out there, either extremely well-educated or cut and paste a lot of complex material. i am not critical of him. i don't know what his educational background is but not something you are discussing in the streets over coffee. if you had a female tech employee on who said she would find this would create a hostile work environment, there is a very low threshold, intentionally low threshold for the creation of a hostile work environment because the statute that prohibits hostility in the work environment has clawss that they this statute should be interpreted liberally to protect the sensibilities and sensitivities of employees, not of the employer. if the employer, google, is aware of the statute and we presume they must be, they probably, in a prophylactic way, to prevent any further damage decided to fire this guy.

can they fire him for expression of opinion? there is a statute in new york and california that prohibits affecting an employment relationship because of political opinions expressed outside the workplace but i don't think this is a political opinion and certainly was not outside the workplace, it was at the heart of the workplace. can the employer determine that an incendiary opinion phrased in the language of psychobabble is so disruptive they want to get rid of the person who articulated, answer yes, first amendment regulates the government, it doesn't regulate employers. connell: they have the right to do this. judge napolitano: he will probably challenge it, very strong views held by a lot of people but some view them as out there and the court will view it but whether in new york or

google, and lose. >> after he was fired when i first heard about the story, first reaction, i have two.is, what is 14, when is 12, the first initial opinion, a similar reaction can you get fired for expressing your opinion even if you disagree with that. judge napolitano: it is not right or wrong. is this a protected opinion. can it be so incendiary that when articulated in the workplace it establishes a hostile work environment but the author has to go. connell: is there a way to say something similar? don't know if he backed up with anything but this opinion is men are better suited to work in technology than women. could he have said that in a way that wouldn't have got him fired?

judge napolitano: i don't know what he did. not in hr person. i don't know what prompted him to say this but either ways to say it in a softer way? in a more intelligible way, try to read that. connell: can you get around that and say you may disagree with me -- judge napolitano: the way to do that is both views are equal support. just throwing this out in the marketplace of ideas, arguments for and against, he attempted to do that but was decidedly in favor -- of males. connell: if you said something like x% working technology, 70, 30, why is it the case that men are better suited than women? starting a discussion rather than expressing an opinion.

judge napolitano: google is known for the liberality of your ability to express opinions and have discussions. but if they get so incendiary that people are offended by it they take action. connell: and they did. you don't he will win. judge napolitano: not in california or new york. connell: an interesting case. judge napolitano: a summer home in south dakota. a little different and google has the presence. connell: let's not encourage anti-women comments. good to see you. we have to run. one is time, the company time, times are changing for time, came out with earnings report today and the ceo coming on live with us, great chance to talk about the media industry, that is changing with it and that is coming up, don't go away. can't sleep? take that.

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>> new numbers from time inc. 44 loss compared to 18 million a year ago, companies looking at $400 million in cost cuts, stock is down 41/2%. president and ceo richard batista kind enough to come into the studio and join us before the last break about the media industry. the industry is hit by a lot of things and you are hit by some of them to the extent you have to make these cost cuts. what hurt you most in the most recent period? >> we are a company that is going through a difficult transformation, for 90 plus years, basically a print magazine company but we have transformed into a multiplatform

company so print is a powerful platform for us but print is challenged. there are revenue declined in the print business but what we have done a lot of people don't know is still tremendous revenue on the other side of the equation. we have $1 billion of revenue primarily digital, also brand extension revenues where we take our quality brands and do 40 hours of television programming for a number of networks, we do events. leveraging our brand. the exciting one to mention today's tomorrow night we are premiering on the abc network a four our special on the life of princess diana. charles: that will be bigger. >> we see real growth opportunities. connell: i mentioned cost cuts which a lot of people in the

industry have to deal with and dealing more with glass and having to fire employees for lack of a better term so that is difficult but for someone who wants to get into this industry or is thinking about media what do you say? to the point you started to make, you got to do a little bit of everything. >> you need to be more versatile today. i could speak about our company, what attracts people is we are multiplatform so we talked to a young journalist, editor or producer, they can work on a print product, digital website, television program, event or life experience, that i call the 5 player they have in baseball, a great way for us to motivate people. connell: doesn't quality? i feel i am not that old but someone who is 10, 15 years younger, are they as good at all of them or can they be? doesn't hurt the industry? >> i don't think it does at all. one of the important things when you look at reversing the new

platforms we have 265 social media followers, we have three channels on snapchat, we have a team of dedicated people who are good at creating content for 15, 16, 17 and 18-year-olds. connell: facebook is the more traditional example, how about monetizing what you do? put a lot of product on, do you make money doing that? >> snapchat has built an impressive and revenue platform that they are participating on revenue streams with partners like us and being growing revenue. connell: do you think their model works before i ask? >> thing that is working for snapchat is have a highly engaged audience that is hard to reach. when you talk to an advertiser that intrigues the most.

connell: there is something for a few months and you spend a ton of money to develop something, let me put this product on, this new system and the kids are on to something else. connell: >> you have to be prepared to create content for big platforms and prepared for some of them working overtime and some of them not. you can't think you are going to be right all the time. once we are doing is making sure we are being judicious about it but if we think there's a platform that is the with growth opportunities we will partner with them. we have a great relationship with facebook. connell: is facebook a rival for a media company like you or a partner? >> i like to say -- connell: a lot of people say, what does it mean? >> there are times we are competing on advertising revenue. we think we have an interesting

value proposition. a tremendous company that is doing well but we have content. what we do with them is one of the biggest digital advertising revenue growth in digital revenue going forward is native content partner with advertisers, we take that content, and owned and operated properties but ride on social. as facebook grows. connell: how big they are, i feel to some extent they want to get what can remain, as much as they can add as little as they can. >> they have been good partners to us. their partners needs to win too. and a challenge of fake news, environments that are not necessarily safe for advertisers we are seeing a move back to flight to quality.

we have premium environments and advertisers want to be around content that has the premium they trust. connell: neil was talking about it on this show, for you guys, to try to get as many people interested, the environment is so large. when you talk about covers of time magazine for example, this one was donald trump, this is provocative to say the president is lazy, a little pushback, time magazine cover sometime ago, provocative. is that the idea to be more provocative in 2017? >> in the older days, to give people the news because we didn't have the news cycle. so today it is about creating debate and creating insights,

giving people the tools to debate and if that means being provocative, it is good because it incites debate. connell: a priority to do that as opposed to exclusive content that breaks a story -- >> always a combination. we have incredible relationships in washington and new york, journalists who are the best in business, always looking to create high quality content. the users who go to our properties are that kind of user. connell: what do you think of this environment to give the president go there for media companies every day of the week. >> the fake news push is detrimental. we we create important journalism, that is the high quality. at the end of the day you keep focused, keep your eye on the prize and understand there are twists and turns but you have to stay focused. connell: does it hurt the business?

>> i don't think fake news is positive for the business. what has been good for us is the news cycle is so important it is making people go to news who never did. we are seeing audiences we have never seen, time.com had the highest in their history, that is the positive side. connell: good talk, we are more interested than anybody else. it is what we do. appreciate the time, president and ceo of the company. we have news on north korea, the washington post report about making a nuclear warhead that can fit inside a missile. the dow off of highs, we talk more about that coming up next.

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connell: the news of the day is on north korea making this nuclear warhead that can fit inside a missile. that is what the washington post reported an hour or so ago. attend straight record close off of highs a little bit. let's talk more about this. a guest on this hour, what this story means, it is official that north korea is a nuclear power but nothing gets in the way of

this record-setting stock market. >> traders are a superstitious loss. normally they will move off the diamond the turn of a dime but they can't afford to. you still have central bank stimulation worldwide, easy accommodative policy and rising rates. they can't afford to get out of the market if that makes sense but plenty of hedging is going on. connell: whether it is north korea or political donald trump news, political back and forth, a decent amount of tune out. >> i wouldn't use, playing acute attention and not as jittery as they have been, learning to live with terrorism, learning to live

with north korea, capitalism is strong, earnings are still good, traders play with real money, like politicians, growth will continue and it sounds strange but trusting there is a solution. connell: at some point there is a move backwards in the stock market, a new record high every day of the week, and people set themselves up for that, there are political headwinds, tax reform and questions whether that gets done. how should people set themselves up in terms of anticipating some sort of pullback? >> a very important question. what you don't want to do is time the markets.

figure out what you would sell or what you would buy if you had a chance to do so at a discount. make those decisions now so when the heat of the moment arises you don't make knee-jerk decisions because they never ends well. the markets have an upward looking bias and as long as those earnings are there the projection his path of least resistance in spite of the headlines. connell: give me an example where that fits into your own mindset, we happen to be looking at or we were, many tech stocks moved into laggards today which i the likes of merck and verizon but before that the netflix and apples and those stocks up there, you see those games for technology. what is your mindset in terms of stocks that have run up a lot that it may be time to start thinking about taking profits home? >> you want to be intelligent and decide who makes the must-have stuff and who makes the nice to have stuff. amazon versus everybody else, amazon is a keeper. the periphery in technology, stone and mortar retailer is a has been unless they have an

amazon strategy, i would be looking at core technologies, companies like rayvoin, that is what we need. the smaller defense periphery plays in europe, i would be pruning those. that is the kind of thought process going through my head. connell: that makes sense. tax reform or something else we don't know about, good to see you, we have to run, good to have you on. information coming about the president, the white house saying donald trump has a conversation with speaker of the house paul ryan and some other house members on health care and also on taxes. the fallout on that coming up.

connell: just over an hour president trump will hold this briefing at his golf course in new jersey on the opioid crisis. we'll have cover of that. disney reporting after the bell. don't forget about that. look at espn, a huge part of company's growth, we'll look for disney. david and melissa have you "after the bell" 4:00 p.m. eastern on the fox business network. for disney, everything else. on top of all that, the white house is now saying president trump did speak with speaker of the you house paul ryan and others on tax reform and health care. charlie gasparino was in here reporting earlier this hour there is now a divide between

the senate and house on revenue neutrality on tax reform. that is a big one, whether mitch mcconnell is giving in to soften his stance on revenue neutrality. i will see you 12 to 2:00 p.m. eastern filling in phoneme again. you now it is trish regan. trish: thank you, connell. wash upon post says -- "washington post" says north korea is closer to a full-fledged nuclear power. it has a hundred ture warhead that can fit inside of its missiles. all this as the dow and s&p hit once again all-time highs. we are in record territory. the dow jones industrial average will it see a 10th straight day of records? i'm trish regan, welcome to the intelligence report. ambassador nikki haley issuing a stern warning to north korea today. all options are on the table. the united states is rea t