david: i'm david asman and this is a fox business special report on the market sell-off today. the dow suffering its biggest one-day point drop in history plunging 1,175 points. erasing all its gains for the year. volume was the heaviest, 11.3 billion shares changing hands. signs of inflation and rising rates threeghtd wild day on wall street with the dow down almost

1,600 points at its low. it represents a paper loss of $1.4 trillion. stock futures are trying to stage a comeback of sorts. joining me for a report. nicole, after it went down 700, it started trading down in 50-point inkrements. when it goes in 50-point increments, you know you are in trouble. >> that's when you say whoa! it happened so quickly. about 3:00 we were down 750 points. by 3:11 we were down 1,600

points. they had sold off everything. they jumped out of everything. that's when you start to feel it's programmed trading. david: program trading are computers. were the human beings on the floor panicking? >> one of the traders said i just bought. right near the low. the truth of the matter is people are looking for better value. we have had a market that has run up since november of 2016. one trader said we are down a couple of days, but that's not the story, the story is we are up 400 days. so a little bit of a sell-off is okay. david: even though the programming trading was going on with a vengeance.

there was a sense that perhaps this is going to calm down after they get it out of their system? >> you want to get a correction in. we want that 10% mark. we are just over 10% on the dow at one point. they wouldn't be surprised see us try to touch those levels again. don't be surprised if you see a pullback. i saw neil cavuto talking about that. taking it all in stride. he said i'm look to buy more of my amazon and netflix. and the people -- if you are watching the market every dane you are worried about losing money, maybe you shouldn't be in it in the first place and you want to make a safer investment.

david: you talked about that one trader who had $1600 in. >> there really isn't any fear. there is plenty of hope not only in the stock market but in america. tax plan and the corporate earnings. one person was saying you are not going see great corporate earnings because you have seen an improvement and markets selling off. it's a real understanding of understanding what's happening win nation and interest rates. they were betting you might see some more selling. david: you stay with us. we'll bring in king view martin

asset market. and scott, i want to go to you first. nicole put it perfectly. the fact there is more hope than fear. not only in the markets but also in america in general. when you see down moves like this. we have seen percentage losses even more than we saw today. when you see them in context of a healthy economy. generally healthy economy, it doesn't last long, does it? >> it shouldn't. i throw on top of that a healthy earnings environment and healthy administration with respect to business. for the first time in 8 years. so there are tail winds. nicole talked about how if somebody is watching these markets kick by kick. 50 points by 50 points. they are more than tick by tick. you probably shouldn't be in these risk assets. you should be in cds, money

markets and heavier in bonds than equities. there are risky areas that got overinflated. markets overshoot on the up side and overshoot on the down side. now we are trying to you find that's question lib yum where fair -- where equilibrium is trying to be attained. david: we had an 8,300 point gain since the election. you point out earlier it usually takes 6 or 7 years to get that kind of gain and we had it in 14 months. >> you are correct. we have nod not had a bear market of consequence sphoins '09. i think everybody on their comfy couch thinking nothing can go wrong with the market and we may

be starting to unwide this crazy -- unwind puffed up asset prices. i believe there is probably more to go than most of think. and i would not be surprised to give back half what we got from the election which would be 1,500 points. danielle, it's clear central banks have been buying up too many assets the past couple years to keep the interest rates low. now that economies are beginning to get healthier they think it's time to unwind that. how much damage will that do to the markets beyond what happened today? >> if market history is any guide, we'll see a robust turn around tuesday. we could see uptrading for the rest of the week.

last year it was as have enron and lehman brothers and bear stearns were crashing at the same time because there was a record 2 trillion dollars of quantitative easing pouring into the market by put us on our comfy couches. $2 trillion to $1 trillion. and if the stock market is as it's suppose to be, a forward-look mechanism, it's anticipating the doctor will only give half of the methadone in 2018. we'll anticipate that and fall off. we did see the bond market rally today. david: the bond market is in trouble. what happens when the central bank gives up the assets they have been holding. the marketplace is filled with

all these bonds. when there is too much of something, the only way you can make it desirable is to raise interest rates. won't that do damage to the market? >> today he had a individually and i was impressed with his poise, and was very articulate. he made the statement, i'm happy the financial system is so much stronger than it was. allen greenspan came to august august 11, 1987. at least he had a two-month month honeymoon before crash day. the question is, is he going to blink and begin to unwind the balance sheet? er. >> is he going to pull back on that commitment.

>> david, one of the outcomes of easy money is risk take and learn. margin interest is its highest ever and it's your best friend in bull phase and worst enemy in bearish phases. and somebody who has 100,000 in stock on margin, that margin thoos come off first. i'm not sure that's happened yet. so it's something to watch. david: the economy is doing damn well. all the indicators are positive. and we haven't had effect of all that cash abroad coming back that will be invested here in the united states. we haven't had the effect of all the raise and salaries, and the extra bonuses.

once all of that begins to kick in more than it has. won't that give even more of a boost to the economy and reflect itself in a healthier market? >> i think that's the foundation to the floor. don't forget the treasury department which is getting records in. >> let's look back at the history of the cbo and how right they have been. what's interesting. they have an agenda like we have seen before from some of the other think tanks. unlike '07 or 2000. there aren't warning signals flash like there were in previous crashes. things are actually i believe just starting to reaction celebrate.

david: sometimes the stock market doesn't reflect the economy. during the obama administration sometimes the economy was terrible but the stock market was going up. we got great news about jobs friday, and there were details about people getting more money. but that concerned a lot of people about inflation. whether that's going to stimulate inflation more than it has been stimulated. >> wage growth has been front and center. that's something we wanted. that spooked the market. you shouldn't think rates going up. we are coming off historic levels. it's more a normalization than rate hikes. wage growth is wonderful. that's what we want to see for the american people. what is worrisome is the nikkei

of japan. and we are seeing this divergence of our own futures looking higher. but after the bell they were look low. expect some volatility tomorrow morning. david: the fed should be focusing on the value of the dollar. that took a hit when we heard our treasury secretary mnuchin suggest the dollar should be worst less than it is. the day before the treasury secretary james baker said the dollar was too strong. i wonder if talking down the dollar is the won't markets went down. >> secretary mnuchin after make those comments he wisely tried to back off of the following day. but the word were set in stone.

the markets reacted accordingly. it looks like the dollar. if the markets begin to anticipate we should see the dollar strengthen. david: i don't have time for more than a round robin. but nicole, what happens tomorrow. do we see a dow ending lower or higher? >> higher on the end of the day, wild guess. david: scott martin? >> down early and higher by the end of the day. david: gary? >> i think we are going lower the next few weeks, probably lower tomorrow. david: danielle? >> i would agree for the longer time, but tomorrow should be turn-around tuesday. david: thank you very much, scott, gary, danielle, nicole.

thank you for joining us for this fox business special report. market coverage continues tomorrow morning on fox business at 5:00 a.m. it's easy to think that all money managers are pretty much the same. but while some push high commission investment products, fisher investments avoids them. some advisers have hidden and layered fees. fisher investments never does. and while some advisers are happy to earn commissions from you whether you do well or not, fisher investments fees are structured so we do better when you do better. maybe that's why most of our clients come from other money managers. fisher investments. clearly better money management.

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kennedy: president trump says the release of the nunes memo profits entire saga is a witch

hunt. he has escalated his criticism of the fbi. my next guest is the only former fbi agent serving in congress. he says we can't judge an entire institution due to the actions of a few bad actors. i am intrigued by all of this. everybody is choosing whatever adventure they would like from the dueling memos. but you say the memo from last friday raises more questions than answers. >> i read the memo. it identifies certain individuals and the facts contained therein were troubling to say the least. kennedy: what was the most of troubling for you. >> it goes to the fisa affidavit and fisa application process.

what facts were included and not included that were exculpatory. we need context to these facts. wheat believe in transparency, it has to be complete transparency. we have to cheer from both sides and put the facts into context. kennedy: also look at the shared facts and see what we can glean from that. but we don't get to see these fisa applications. there is so much about these processes that are secret. if there is one good thing that comes from this, i hope it, the realization that the american public can stomach transparency and it's bert for the process and liberty at the same time. >> one of the reasons we need to do this. i fought hard for the

reauthorizing section 702. so if we are going to have credibility in trying to reauthorize section 702, we have to be honest with the shortcomings of title 1 of fisa so the american people have confidence when we make decisions down here that we are being transparent and honest with them. kennedy: there are those of us who lost confidence long ago it many just too easy to abuse that power these agencies are entitled to, especially when they are operating with such secrecy. there is more of a disconnect than ever. now we are seeing how easy it is too compromise liberty in the pursue of security when you deserve neither but you attain neither. >> the continue number all these

cases is the need for confidentiality. and the public's need and desire for transparency. we have to factor those competing concepts and make a facts specific combination. >> last week the president re-is nighted the conversation surrounding something near and dear to this show, and that's the right to try. it's stuck in limbo in the house after unanimously passing the senate. congressman, you introduced the right to try act in the house in february. what's the holdup? if you have the president's support and support from to both parties? >> we are working with house leadership.

the issue is the original senate version, and the version that passed was different than the original version. the fda commissioner expressed concerns with patient and doctor certification and liability issues, and how to define the pool that's eligible for use. the right to try bill allows terminally ill people to try drugs that passed the first phase but haven't made their way through the pipeline. kennedy: those who die in the process waiting for the ability to try drugs and treatment. you are fighting the good fight. i hope you were ready to reconcile this bill to give the

terminal patients the dignity and hope they deserve. >> not just patients, but their families. they did everything possible. that's relevant to their peace of mind. i thank you for the attention you are bringing to it. wee have been fighting every single day. we are supposed to meet with house leadership early this week. the president is mind it and we have got to get this across the finish line. kennedy: thanks again. good to have you. coming up. just three weeks since they reached that temporary deal. lawmakers will be heading towards another shutdown. can they accomplish anything other than kicking the can down the road? ♪

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kennedy: government funding running out thursday. house could vote on an interim spend bill as early as tomorrow to avoid another shutdown. john mccain teamed up with democrat chris kcoons.

it does not include funding for the president's wall. the president tweeted any deal that doesn't include border security and the desperately needed wall is a total waste of time. welcome back to the show, chris stirewalt. >> i heard him saying let's make a deal, come on. chuck and nancy. kennedy: little adam schiff. be friendly here. what is the holdup here and why are we only seeing crisis legislation? >> because humanity has failed. no, we knew that before.

the issue here is that republicans desperately, increasingly desperately want to get rid of these must-pass things. democrats have chosen daca which gets better to them as a subject the closer they get to the deadline. kennedy: you mean because they are using the dreamers as bargaining chips? >> as human shields. i guess they both are. the republicans are saying we want x in exchange for protecting these people and the democrats are swieg wants y. kennedy: you are seeing bipartisan legislation in to both houses of congress. it sounds like you have republicans souring on the wall. >> republicans were pretty sour

on the wall to begin with. i have heard many, many, many, many different ways the way republicans defined down the wall. trump has defined it in a way people didn't understand in is a way through this. what this bipartisan legislation represents is a challenge to republican efforts to find an offramp here. there is legislation from rob portman of ohio. that's what you will see, a simpler, smaller deal that's a one-for-one trade-off. if people didn't care when they shut down over a weekend, if we continue to govern like this and see these problems, markets won't like the and they will punish washington. kennedy: so will the freedom

caucus. they want a piece of spending legislation that doesn't equate to every month or so screaming holy under wear and running through the aisles of such a sacred institution. kennedy: i don't know what you call it, but i think something is wrong with the system. we are getting unnecessarily dramatic. we'll see how this one ends, chris stirewalt. >> that's an evergreen tweet right there. kennedy: nobody sought shut down in super bowl 52. the game set records for yardage, burning cars and

smashed store fronts. tom brady all but sealed the win. the phillies fans were flagged for unsportsman like conduct conduct. the party panel is a back. welcome back, everyone. let's talk about some of the highs and lows of the game. what did you love about the game? >> i love the horse-puppy incident. they knew they had to couple something. them already greased the height poles so we can't -- the light poles so we can't climb them.

but then you say that's not going to be enough. kennedy: you remember a fan punched a horse after the phyllis' division -- the phillys'' victory. this is what winning looks like. what did you like about the game other than tom brady losing and his wife being so mad they couldn't even show her miserable face at the end. >> it would be a beautiful miserable face. what struck me was the halftime show was 14 minutes of our life we'll never get back. justin timberlake's costume has come under much scrutiny. we had the panorama, the camouflage. i think this relates to katy perry's guilt about appropriating other cultures.

she was told she was not honoring other cultures. so i think timberlake was trying to look like backwoods white people. kennedy: i felt the performance was very under whelming. prince had one of the most of legendary super bowl performances of all time. what did you like about the game or any of the events. >> i want to mention there are two eagles i think should get beside winning the super bowl. chris wong has donated his entire salary partly to charlottesville * for scholarships for cities. and one of the players during the creepy season where there

has been so much controversy who has stepped up and said i'm going to be part of the players talking to law enforcement and talking to the league. kennedy: actual solutions as opposed to taking a knee for something so vague and demand that where so difficult to understand. but talking about law enforcement and talking with kids has a measurable impact. >> they were winners off the field as well as on. the fact they lost because he full bold was perfect. it was a great game overall. he looked stunned. but the nfl has a lot of work to

do in the offseason. we talked about the health issues. >> the health issues are huge. kennedy: the ratings were down a tiny bit, but the game was fantastic. coming up. defense hawks want to increase funding for the military. but a report says the pentagon last track of $8 million. do they deserve a raise? how do you win at business? stay at laquinta. where we're changing with contemporary make-overs. then, use the ultimate power handshake, the upper hander with a double palm grab. who has the upper hand now? start winning today.

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experience amazing at your lexus dealer. kennedy: the defense department is failing to account for hundreds of millions spent by the military. the defense logistics agency has $800 million in construction projects that were not properly documented or accounted for. the department of defense has an annual budget of nearly $700 billion this year. the president look topic crease that spending for next year. he promised to beef up the military while eliminating government waste. how can we cut spending and make government more efficient if we don't know where the money is going. joining me, my friend bryan

suits. welcome back, suits. how do you lose that much money? >> defense logistics agency is a civilian-run agency but part of the pentagon. they have their own inspector general. here is the thing about the pentagon. afghanistan says hold my beer. $700 million would be a relief when you cop pair that to the inspector january in afghanistan and iraq. kennedy: didn't when find the department of defense miss appropriated $125 billion. >> you say misappropriate, they say lost. the pentagon does try. i had to account for he round of artillery. as a fire support officer i wasted a powerball jackpot worth

of jet fuel and munitions. and i had to account for it. reconstruction in iraq, the pentagon tries different' not an excuse to say we provide you the freedom that you sleep under, don't ask us how we do it. that's a bad excuse. i want that out of amtrak and the post office. the pentagon has to account for this. it's crazy. kennedy: rand paul pointed out last week on the "outnumbered" couch that the post office lose a billion a square and the key to fixing bureaucracy and waste isn't throwing more money at it. is there a way of still loving this great country of ours and supporting the brave men and women brave enough to wear the uniform but streamline so thing

operate for effectively. >> hire ernst and young. in the private sector you can find this stuff. hire ernst and young to audit the whole pentagon. the biggest waste of money i have been a part of, i worked as a private consider, and i got it up inside djibouti and we built an anti-piracy training center. and the state department paid the company i worked for paid to build a counter piracy training center in uganda which is land locked. kennedy: i hope they had a powerful catapult. thank you for your wisdom.

coming up. the unified korean hockey team took to the ice the first time yesterday and it showed. we'll tell you how many shots they put on goal and how many shots kim jong-un put on them. the "topical storm" is next.

it's easy to think that all money managers are pretty much the same. but while some push high commission investment products, fisher investments avoids them. some advisers have hidden and layered fees. fisher investments never does. and while some advisers are happy to earn commissions from you whether you do well or not, fisher investments fees are structured so we do better when you do better. maybe that's why most of our clients come from other money managers. fisher investments. clearly better money management.

kennedy: on this day in 2017, tom brady led a stunning comeback against the atlanta falcons. but the only comeback he's doing today is eating carbs. we begin at the site of the big game where the underdogs are still celebrating their huge upset. of course, i'm talking about the puppy bowl which fan with a parrot playing piano. team rough got out to an early lead. their fans smashed store fronts, toppled light poles and burnt cars all over town. i know a lot of people are

criticizing eagles fans and act like they have been there before, but in their defense, they haven't. the eagles winning a super bowl is like kim kardashian winning a spelling bee or hillary clinton winning a presidential election. what's one more car burning in philly at this point. good for you. fly eagles, fly. topic number two. the super bowl wasn't the only human sporting event taking place yesterday. north korea and south korea formed a hockey team. they played against sweden it was attended by 3,000 people. while they have no problem finding a crowd, their offense was scarcer than the internet in

north korea. the team lost 3-1 against sweden. coaches sensed a need for more practice time. so following the game south koreans played a scrimmage against north korea. the final score was south korea 8, north korea didn't. a florida man was assaulted by his boyfriend after he played song by sting. if you think that wasn't weird enough. you should see who showed up when he called the police. no, he didn't get a visit -- his boyfriend played if you love someone set them free. he feared he was getting dumped. and he couldn't stand losing and

went full king of pain and smashed his partner into a wall. he was arrested but he has since been arrested and placed under surveillance. which means every move he makes and every step he takes and every bond he breaks they will be watching him. i'topic number 4. that gives something to write about for hate mail thursday. doritos is developing a lady-friendly chip more women who don't enjoy the loud crunch of traditional doritos. it's about time someone focused on the real issues affecting women in society.

they are turned off by getting chip dust on their fingers. if they learned anything from the #metoo movement, women are to be believed. so most of of the women at the marches look like they like junk food. they will come in smaller bags designed to fit in women's tiny purses. are you saying a woman can't afford to buy her own bag of chips? maybe. topic number 5. a florida man was arrested. at his apartment complex for work out naked at the gym. thank you, florida. his neighbors were absolutely

stunned to learn someone was still work out this many weeks after new years. but the 57-year-old, he's not a quitter, according to a leasing agent who saw him utilizing the stationary bicycle completely naked to include no socks or shoes. he was arrested for disorderly conduct and the cops say he had a suspicion package. i have got a million of them. if found guilty, he will be sent where all men go who like to walk around naked. the gym locker room. coming up, you might have trouble remembering what happened after a wild night of drinking. but a new study says slow doses of booze can help you remember stuff later in life.

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kennedy: many of you may still be hurting after overdoing your celebration at the patriots' loss. there is no doubt too much booze hurts more than your feeling. but there is good news from the liquor consumption department. brain research from the university of rochester found

slow levels flush out the brain and may protect it from harmful proteens associated with alzheimer's and dementia. when they gave rodents the hive lintd of two drinks a day. if you bites up too much, you montgomery make the problem worse that causes swelling. but it's good to know a glass of pinot and a fireball chairs are effective in keeping your your n nice. thanks for watching the show tonight. you can follow me on twitter and instagram. email kennedyfbn@foxbusiness.com. tomorrow night on the show, lieutenant colonel ralph peters,

michael malice and dennis admiral. ♪ >> it's the revolver that won the west. >> this is a serious piece of weaponry. >> and she inherited a slew. >> buying the guns turned him into a cowboy. it was an obsession. >> you in there? >> lawmen and outlaws alike reach for the hotshot of colt pistols. >> i was always told that it was a million-dollar gun. >> talk about bang for the buck. >> i've been looking for you. >> or will it all backfire? [ gunshot ] [ door creaks ] [ wind howls ] [ thunder rumbles ] [ bird caws ] ♪ >> i'm jamie colby, in garden grove, california,