stuart: well the plus 200-point rally continues. now we're up 220. pretty close to 25,000 on the dow industrials. i wonder if i could call this, what is his name? kudlow rally. charles payne. it is yours. charles: still the trump rally, stuart. thank you very much. welcome to "cavuto: coast to coast." i'm charles payne in for neil cavuto. stocks are rallying driven by internationals. president trump arriving on capitol hill for the friends of ireland luncheon. blake burman with the latest. blake. reporter: feels like about a week ago since president trump decided to fire his secretary of state move the cia head into that position. that was just tuesday morning. since then there has been even more change here at the white house as the president announced yesterday, that the white house and larry kudlow will soon be replacing gary

cohn's president's top economic advisor. there is not a distinct timetable. i was told by a senior white house official that transition should take soon. more change could be in the works here. many criticisms come toward va secretary david shulkin. rick perry's name attached to that job. another name to keep an eye on "fox & friends" host pete hegseth. he was original pick for va second is tear during the transition. there is constant rumors following national security advisor hr h.r. mcmaster that he could be replaced by former u.n. ambassador john bolton. president saying unspecified story talking about all the potential departures was quote, exaggerated, but the president also said that change is good. >> it was a very false story. a very exaggerated, a very

exaggerated and false story. but there will always be change and i think you want to see change. i want to also see different ideas. reporter: the white house earlier today, charles was playing this off as nothing to see here kind of thing, don't focus on jobs inside the building behind me. instead focus on jobs taking place all across the country. the reality of this, these are not just any jobs. these are major players within the administration. two different cabinet secretaries, the top economic visor and, some others who could potentially be on the way out. keep in mind the white house still has to fill the top communications director role as well. charles? charles: they have a lot to get done there. thank you very much, blake. the question are the shake-ups a good thing for the white house. "washington examiner" white house reporter says this is distracking from the president's agenda.

state your case, sarah. >> this is distracting from president trump's agenda. we saw imposition of potentially historic tariffs against steel and aluminum imports. yet we're focusing on staff turnover, some of these positions typically would not be household names. hope hicks, communications director. gary cohn, chairman of the nec. these are typically inside baseball washington stories that a lot of people outside of washington are talking about because the dramatic nature of these firings. in the long term, it is important that trump does have a cabinet and west wing that serves his interests. some of those people in high level positions cohn being one of them, mcmaster being another, who actively pushed back, tried to convince him not to go through with some of his campaign promises or tariffs or ending the iran nuclear deal. charles: right. >> in the long term this could lend itself is to more stability. charles: when you say we are paying attention to it.

perhaps we are particularly in the media. i'm not so sure that president trump is distraction for him. we even saw during the campaign, he switched campaign managers, he made moves quickly. business people are accountable. in government there is no accountability. you go four years, two years, every six and persuade people to reelect you, you make new promises. in the real world accountability comes at you very fast. we have corporate earnings every three months. i think the president is acting like a smart businessman, recognizing a problem and moving swiftly on it. i don't think it will hurt him personally or those around him in terms of his agenda. >> may not hurt him personally. in fact that could help him implement his agenda more effectively. we have a secretary of state who shares the world view. we have an economic advisor who supports his trade policies a communications director that has better relationships in washington more effectively promote his message of the

problem that it distracts pretty historic things in the white house, in terms of the public's attention. one of them being historic announcement that trump prepares to sit down with kim jong-un in north korea. that could be something that defines the foreign policy legacy of his presidency. yet it was quickly forgotten as we go through the rapid fire staffing changes. charles: i don't disagree with you. i put majority on the media. friday, amazing jobs report, 800,000 people came back to the labor force including blacks, hispanic, women. i looked at other networks they were talking about stormy daniels. the media gets to pick and choose what is important for the american people. i think historic amount of jobs we're creating at this point, probably more important than a scandal that happened before the president was president. >> you may be right but the white house can be strategic how they announce the staffing changes to allow the media, which they already though can be

schizophrenic what it covers what they want. that is what previous white houses have done. that is what other politicians do when they want to focus something attention on successful jobs report, historic foreign policy announcement and or shift in the trade policy. they could hold off changes, some are under discussion for months. there is no urgency to make them now, to insure that they get the attention they deserve for those other things. charles: sarah westwood, thank you very much. appreciate you, you are one of the best out there. thank you very much. >> thank you. charles: president trump meanwhile praising larry kudlow earlier today. take a listen. >> larry kudlow just came in a little while ago. i think larry is going to be outstanding as economic advisor. so we look forward to it. charles: to former reagan advisor david siick on larry kudlow backing the president's tough stance on china. they differ with respects to tariffs and other aspects of the

economy but certainly china has to be something that they both probably have to stand firm on, right? >> exactly. china is the whole ball game. i'm amazed how reporting on the tariffs, it is like it is, tug-of-war between the skins and the shirts. it is actually, what is going on international community is moving so quickly, multilevel game of chess. the big player is china. the second player is the u.s. one of the things i like about larry, he is not a phd economist. he is not defending a thesis from 40 years ago. he is a smart, capable guy, who has been around a long time, he knows the global economy, the global financial system. it is all moving quickly. it is being reshaped by the chinese and we have to realize, you know, develop a strategy, very, very quickly. i think that is where larry can be very helpful. charles: no doubt, everyone to

your point, shift something going on plain sight. we gone a long way from late-night commercials when sally struthers was begging us to feed the chinese. they're going after our debt and -- >> absolutely. you talk to any, i tell my free trade friend, i'm a protrader, you talk to anybody in europe or britain who knows and deals with the wto, the world trade organization, they said it was a huge mistake for the west to let chinese in. they are not house trained. they cheat on everything, a difficult way of doing things. they are looking for technology, whether they can steal it or make it kind of a requirement for investment in china or for selling into china. so i think that's, really what this tariff stuff is all about. it's a shame this message hasn't

gotten through. you will not have major global tariffs on our trading partners. it is going to be mostly geared towards the chinese. as you know, charles, this is, they have a plan, a long-term plan. charles: a long-term plan, yeah. >> it involves massive surpluses with the west. it involves infrastructure spending throughout 2/3 of the world with massive lending, using those surpluses. i mean it is kind of what the british did in the late 19th century but it's a major threat to the united states. let me ask you this a question. who is germany's number one trading partner today? charles: you will tell me it is china. >> it is china. china. charles: to your point, they're building the new silk road all over the world not just here but everywhere. >> absolutely. charles: multi-hundreds of billions of dollars. we have people on wall street saying hey, don't change anything. stick with the status quo. it drives me nuts. so what if boeing shares have to

go down a little bit. ultimately if we keep the status quo i think we'll be number two in the world. >> absolutely. distant number two. what is interesting is, that the chinese influence. is is very subtle but on the american media, on hollywood, across the board, no one really can talk about china. no one wants to talk. you don't see it on wall street because their influence is so huge but i'm telling you, if you are worried about your kids and about their future you will take china very seriously. russia is a problem but it is a sideshow. larry knows this. charles: don't take them seriously, teach mandarin, so they know how to address their supervisors in the future. we'll shift. speaking to the friends of ireland hundred can chon. >> thank you, to vice president

pence and members of congress and some friend from ireland. this is special occasion. first time was last year. i said that was a lot of fun. i necessary we have six more after this. we're here, we knew each other from a different life. it was very successful. i want to warmly welcome ambassador mulhall who has done a excellent job of representing a lot of good people. thank you very much, mr. ambassador. [applause] your wife, greta, thank you very much, greta. all the incredible irish delegation whom i know very well. st. patrick's day is time to honor and build upon the lasting bonds of our friendship between

the united states and ireland. bonds forged through strong heritage and values and united vision for a peaceful and prosperous future. more than 30 million americans today claim irish heritage. that is why you have such power in the halls of congress and everywhere else, 30 million people. among the many wonderful americans who trace their roots back to ireland are elected leaders like paul, like kevin, like mike. i just have to look at almost this whole room but, we have just a tremendous group of unbelievable leaders. a friend of mine, cardinal dolan, is a very, very proud person of ireland. it was our first catholic president, john kennedy, himself of irish descent, who set our nation's sights on the moon. we're looking at mars by the way in case anybody hasn't -- try to

top him. we'll get there. moving along pretty good. a lot of things happened, mike, having to do with that subject, way ahead of schedule. astronaut michael collins who you all know, of irish descent, he piloted the apollo 11 mission and plant ad american footprint and american flag where no man had ever done before. this is we have eninto our national character and fighting irish resolve and fundamental american ways of life. so on this st. patrick's day we celebrate our long friendship and close ties with the people of ireland, special, incredible, wonderful people and we look forward to an exciting future that we will all share together and it is an honor to have you with us, and i look forward to seeing you often, whenever there is a problem you call, we'll solve it. okay? exempt for trade.

[laughter]. they got those taxes so low. you're a tough one to compete with the taxes but congratulations, great job. thank you very much. [applause] charles: president trump just addressing the friends of ireland luncheon as he is down playing chaos if you will in the white house, to continue our conversation, connell mcshane, deirdre bolton, executive director of the american rising pac, alexandra smith. let's start with you. i just had this conversation with sara, she is saying all of this chaos is distracting from president trump's agenda and success but i put a lot of this on the media deciding what it wants to talk about and what it doesn't want to talk about. friday, amazing jobs report, it was amazing jobs report. as we talked about it, i looked the all the screens, all this

stuff about stormy daniels. one thing impacts every single american and really matters and the other really doesn't. >> sure on cable news and media outlets, dallas intrigue stories do well. that is what people talk about. when i to home to talk to relatives and to other people that is not the kind of thing they're talking about. there is absolute disparity what is talking about in the media and voters. charles: when you go home what are they talking about back. >> they're talk become tax reform and seeing more money in their paychecks and excited about the economic growth happening under this president and congress. charles: that is what most people -- >> president made a funny joke with the friends of ireland. >> everything but trade. >> that is a lot of the reason why the president was trying to get our corporate tax rate lowered because a lot of our tech companies going to dublins setting up shop, saying hey, this is our headquarters. i like the comedic stylings at

the end. charles: realistically they were renting a room in a building. one building had 29 headquarters. >> they had workers, much fewer than here. 13% is a lot more agreeable to pay than former tax rate 35%. to your point. charles: eu, coming out, this is your beat, looking at special taxes on the big tech names, in part to get that 3% tax. paying we talk about that later at some some point. so-called chaos, connell, maybe it catches eyeballs and maybe good click bait but i think there is nefarious aspect to it as well. >> some weeks more than others. i think some weeks are truly chaotic and some weeks are exaggerated to use the president's term from earlier. sarah westwood on with you earlier hit a key point. some is managing from white house's point of view. she is right, they have not done the best job managing that. if you want to control a news

cycle, to use our terminology, maybe you want to avoid making announcement or tweet at certain time to keep things in control. i got back from pennsylvania, covering the special election race out there, and the president which is one of the things i find interesting i think people are overreading the race and result of it, the president is still popular in that particular district in pennsylvania. at least people i'm speaking to. polls bear that out. conor lamb won that district by being different type of candidate but not capitalizing some sentiment that is antitrump that was pro-trump. these things get everyplayed a little bit, but at same time there have been weeks like we never see in terms of staff changes. forget what happened on monday by the time you get to friday. charles: so-called news cycle, is not 24 hours. you can measure it in days and minutes but, again, we never had a, a businessman in the white house. we saw this even on the campaign

trail. president trump making command decisions, very swiftly. ultimately worked out for him. pennsylvania again, people are talking about that election and that election outcome but i'm not so sure it was a referendum on the president. >> i don't think it was either because if you look at number of votes that rick saccone got vis-a-vis trump's votes in 2016, he got much fewer votes than trump did actually but i think pa-18 is absolutely a huge wake-up call for republicans. charles: what will they do different? >> it was easy to get complacent after 2016. a surprise victory. then sort of unending hillary tour of excuses. charles: will they move closer to president trump or further from president trump? >> i think one thing you have to really account for it renewed democratic enthusiasm. there is a real grassroots effort out there, that is excited, that wants to be

involved, mobilized. they certainly did so in pa-18. >> always comes down to candidates but i think there is something in pennsylvania 18, conor lamb was a good candidate for that district. even though the president won it by 20 points, i spoke to a woman for example, who was out and said he was a better candidate, simple way of saying it, a better candidate in this district than hillary clinton was simple as that. he won back voters might have been registered towards democratic party for years. didn't want to vote for hillary clinton. charles: charismatic, ex-marine, proguns, antiabortion and spoke the trump -- >> this guy is unicorn but admitting -- >> might be more candidates tailored to districts if the democrats are smart about it. >> i don't necessarily know if you get there, you have this mobilized democratic enthusiasm, but at the same time it is pushing party to progressive wings.

look in texas where dccc bernie sanders backed candidates. now they're left with bernie sanders candidate and a candidate they're now backing opposed by unions. >> there is a lot of blurred lines. president trump appealed to independents, a lot of people at times would have voted -- charles: maybe you're looking too deeply into the one unique situation. conor lamb was a unique candidate. thank you very much. china, what i'm calling a trade battle with the united states. their intention is to win the war. i think president trump will try to change that, right after this. ouples: how much money do you think you'll need in retirement? then we found out how many years that money would last them. how long do you think we'll keep -- oooooohhh! you stopped! you're gonna leave me back here at year 9? how did this happen? it turned out, a lot of people fell short, of even the average length of retirement. we have to think about not when we expect to live to,

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charles: well people are spending money. take a look at williams-sonoma and dollar general.

both of these stocks up after posting impressive sales and guidance for the quarter. meanwhile shares of alibaba jumping on reports that the e-commerce giant plans to list on the stock exchange in china after bypassing investors to go public here in new york to trade. as from washington to wall street cower at so-called trade war with china nation continues to gear up to win that very same trade war. xi xinping effectively crowned himself as emperor. he will merge agencies and ministries into powerful units to make swift decisions the ability to print money with an omnipotent central bank. depth of u.s. trade secrets is no secret, the china is not the back water nation featured in the sally struthers commercials decade ago. china is economic juggernaut that plans to usurp america as the preeminent economy on the

planet. competition is fine. let's make sure that it is fair as well. yesterday we learned that china's economy grew at 6.9% last year. that was the first year to year increase since 2010. in addition china's industrial production for the fist two months of the year rocketed to 7.2%, well above wall street consensus of 5.9%. then there is the u.s. proxy for economic's might, boeing, which saw shares rally from 159 bucks on inauguration day to recent high of $369 a share. part of that company's success is vast sales in asia which is becoming the top market in airplane sales. back in 199614 of the world's top 20 airports are in north america. today the number is four. new airport growth continues in china, asia, cities that we never heard of before with millions of folks, so make no mistake. china is already in a trade battle and they expect to ultimately win the trade war. reaction from market watchers

jim lecant and mark luschini. jim, it has been a while. what are your thoughts? i think wall street keeps overreacting of notion of tariffs that we'll somehow fight back because the longer we wait i think harder it is goings to be? >> charles, great to see you. we think it has been a while. possibility of escalation of trade war is only 20 or 30%. where it could hit the american consumer if we go after telecommunications, consumer electronics. that is about $130 billion market. now do we need to trade fair with china? absolutely. intellectual property theft is huge. that is what we're good at here in america is intellectual property. absolutely we need to address this but i want to make sure that people understand that having a big economy that is a great trading power, a great trading partner around the world in terms of volume of goods is a better problem than not. 30 years ago china was a

communist country. weren't really trading with them. now it's a gigantic market. a lot of our businesses do business over there. so i don't want to have everybody take this and say this is really bad. it is going to shoot our economy down the tubes. this is a problem we need to address but by and large them being an economic power is a good thing for global markets and global trade and for the u.s. economy. charles: although, mark, we have enjoyed being the preeminent economy in the world, having the world's reserve currency and things like that, would,s to our advantage. it attracts foreign investment, things like that. there is something special about the position we hold, we want to klink to -- cling to it. i agree with jim, but we would love to make it a smarter, freer, fairer trade, wouldn't we? >> that is the point not to be lost in all the other ruminations what the consequences of a trade battle or trade war are. the good news the u.s. is fairly

closed economy with exports just 12% of our gdp. certainly as it relates to imports u.s. is far more important destination to chinese exports than china is to u.s. exports. with all that said we don't needs canlation in geopolitical tensions that could rise, and impart negative impact on our allies, japan, emerging asian countries around china. their hedgemon status they're acquiring on day over day basis will be exceedingly important to deal with as we figure out on a global basis where our position lies with regard to us hosting that world's reserve currency status things afforded as consequence of it and low interest rate, tremendous, if you will global capital to come into our shores, versus that which goes other places. as we know china lobbied successfully in the role for the drawing rights babasket for the

it to be considered the world's currency today. charles: the growth initiative is absolutely phenomenal. i think it will cement their dominance over europe and it's a smart thing on their part but there is geopolitical aspect of it. the man made militarized islands, obvious global ambitions. how do we reconcile that with the notion we want freer and fairer trade? >> i think you have to get the globe involved. you have to take all the countries being abused by trade abuse, intellectual property theft and target china because they're clearly the most egregious perpetrator of these things. to your point on military, this is a big issue. we have tremendous amount of debt in this country. what that means is we don't have resources to commit to military innovation we have been in the past of the in the past we had the world's strongest economy. therefore we had more resources

to build our military, our might, not only technologically but militarily. now you have china is really ramping up along those lines. you don't want to be put at disadvantage, disadvantageous position because your economy can't support these initiatives. >> right. >> i think it is real important also that they're consolidating their central bank. they have a lot of non-performing loans out there. they have built a lot of their economy on tremendous influx of debt and they need their central bank to be able to absorb a lot of that, or they will run into the same problems from around the world. charles: their total debt is 260% of gdp. it will be 360% in short order. mark, before we wrap this up where do you see this going because there is a lot of say per rattling? my thought, china will make concessions, but maybe not $100 billion worth. they will make concessions because there is a lot to be lost on both sides? >> i agree with you, charles.

i think a resolution we'll find somewhere in between. we'll like to see the administration ask for here in the united states. less than obviously china would have been otherwise willing to give up, a way to sacrifice, put down arms, figure out a way to satisfy our global interests, which is to say a global economy prospering that will allow china to sufficiently grow at a high rate to remain socially stable and at the same time maintain what president xi has designated for the quality of growth in china, not the quantity of growth in china. in order to do that he needs a stable, global economic backdrop to foster that. charles: of course they're trying to shift to domestically driven economy as well. thank you, gentlemen. great discussion. >> thanks, charles. charles: president trump reviewing border wall prototypes. where is a deal on border funding? is it even close? that is an important update we've got for you after this. whoooo.

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charles: securities & exchange commission charging theranos founder with fraud, some surprised punishment did not exceed the punishment from ceo martin shkreli. gerri willis with the news. >> she sought to revolutionize the diagnostics industry. she settled charges of civil securities fraud agreeing to 500,000-dollar fine not serving on board of directors for 10 years. on the other hand, martin shkreli, hedge fund founder, turing pharmaceuticals, convicted of securities fraud sentenced to seven years in prison and levied a $7.4 million fine. he said he wanted to revolutionize the pharmaceutical industry. key difference in these two cases. holmes was prosecuted by securities & exchange commission. while shkreli was sentenced by federal jury.

homes cooperated with federal investigators while he mocked them at every turn. while i courted media, shkreli was a lone wolf a oddball offered his twitter followers money for returning strands of hillary clinton's hair. shkreli gained notoriety raising price of a drug of a life threaten are pa a sight infection in babe is and compromised immune systems, raising the price 5000%. he was convicted of three of eight charges but none dealt with the controversy. holz was charged with stealing $700 million from investors to develop a analyzer that could analyze lab tests with pin trick. the lab instrument homes promised used in a small portion of tests. errors in the results abounded. charles, back to you. charles: moral of the story the

cool kids still get the breaks even when caught with their hand in the cookie jar. >> cool and expected. charles: thank you very much, gerri, intriguing story. is an immigration deal in sight? we're getting mixed messages whether or not a dreamer deal will be tied to the border wall. hillary vaughn in d.c. has the latest. reporter: the white house is pushing back against a three for three deal, three years of daca protections into the spending bill in exchange for three years of border wall funding but some senate republicans i talked to are worried that adding daca into the omnibus now would derail weeks of negotiations. i also talked to senator orrin hatch this morning. he tells me adding a daca fix into the mix could probably piv republicans a little bit more more leverage negotiating other line items in the omnibus. the white house pushing back hard on the idea they would be open to any temporary daca fix. the white house deputy press secretary raj shah saying in a

statement, quote, the white house opposes so-called three for three deal. as a result of the caps deal the routine appropriations process should yield wall funding in the omni us about. it is not just the white house that is against this idea. republican congressman will hurd from texas whose district rides the border says he want as real solution to both problems. >> they're contributing to our history, our culture, our background. we can solve this problem and do border security at the same time. people think that we have the latest and greatest technology on the border in order to keep our folks safe. we don't. some of that technology is over 20 years old. so we should be able to solve this problem. i'm together in a three-year fix on daca, three-year extension on daca actually doesn't solve the issue of daca. reporter: senator jeff flake saying if a permanent daca fix is not possible the three for three is a good alternative. the white house message at this point they're not willing to settle just yet.

charles. charles: thank you very much. will democrats bend in order to get a dreamer deal? to democratic strategist jessica tarlov. we know, hey, jessica. we know that democrats talked about this. that they have championed it. that president obama took unilateral action to push through the temporary fix it you will. what president trump offered significantly more than what we had on the books. so why are the democrats still playing hardball here? >> they are still playing hardball because they can for the time-being. as it gets closer to the midterms it will be increasingly difficult to play any games with this. democrats were very clear that protecting dreamers was number one right for the party. i think unfortunately taking a three-year deal, this is not a solution, kicking the can down the road, a three-year road instead of a couple months is in the ideal. at same time i don't think they can flake on the promise to the

dreamer community and immigrant community at all. charles: there have been really strong democrats who have come out said, okay, you know what? if it means funding the border wall to get a permanent daca deal, particularly the one president trump promised 1.8 million path to citizenship. >> on this particular it is really, really tough. prominent democrats from luis gutierrez from illinois one of the most prominent congresspeople on issue, come on we need it make a dealer who. both sides have to look back to bills they supported in the past like "gang of eight" legislation, "gang of six" legislation. look at the bill put in front of the president, which by the way he wasn't into, the bipartisan deal, what we were willing to give on border security and find some way to make that happen again. these 1.8 million dreamers that is a lot of people that will get

to stay in the country. charles: you and i had this discussion many times. i really believe the democrats, particularly older democrats like nancy pelosis and hillary clintons out there believe the race card and politics of division works. i'm just wondering though, is anyone out there worried about hispanic community, the illegal immigrants who are here and kind of concerned hey, maybe you don't really have my best interests at heart? maybe this is amazing deal and you didn't take it because it was a good political gimmick rather than fulfilling a promise? >> i think right now democrats with midterms approaching and a chance to retake the house are concerned about everything. if we're taking lessons from conor lamb's victory in pennsylvania, centrism wins are core beliefs, protecting medicare, medicaid, not cutting entitlements and going back to core democratic issues, union support, not playing identity politics with people, but better issues. your point about the race baiting as it were, i think it

is important to highlight short comings in the republican platform as it pertains to minorities in this country and illegal immigrant population, 11 million who are here, should be staying here and i agree with you, it should, just get it done if you can so at least you can say to the community, when we told you we were going to fight for you, we did. even though we had to make concessions we welcome you here to stay in america. charles: concessions are a part of politics, particularly when you're minority. >> maybe majority soon. charles: we'll have that discussion at a different time. >> thanks, charles. charles: so what does rex tillerson departure mean for the iranian deal? joe lieberman is here with an exclusive reaction coming right up. ♪ mom you called?

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charles: iconic retailer toys "r" us closing shop for good, selling or closing all of its 735 u.s. locations. jeff flock happens to be outside of one of its stores in chicago. jeff? reporter: jeff flock, not jeffrey the giraffe apparently, charles. yeah, it was debt that killed them actually. you take a look at numbers right now. the shutdown will be about 735 stores. 33,000 jobs. that is a lot of people.

that is a lot of real estate that will be vacant too potentially if somebody doesn't come along. it was the debt that killed them. $5 billion of debt of a leveraged buyout they couldn't get out from under. debt service, $400 million a year the company said in the bankruptcy filing. that is 50 or $100 million a month in total costs they had to spend before they even upgraded stores. in the bankruptcy filing they said the stark reality was, the quote from them, they will run out of cash by may of 2018. they were trying to reorganize but it didn't happen. they're still a pretty big player in the toy marketplace. that is my point the fact debt killed them. take a look, this is the parking lot out here, it is pretty full. i was inside the toys "r" us store here in chicago suburb of niles. people walking in. still doing business. they may have a gift card they're trying to use. if you look where they stand in the u.s. toy marketplace, walmart obviously is the big

one, almost 30% of the market. amazon, 16%, gamestop, and then toys "r" us, you know, is% of the market, that is not a bad thing. the problem is, they had too much debt to get out from under. as a result today, looking at stocks, as you might have guessed, mattel, hasbro, now with a whole lot less, fewer stores to sell their stuff in. they're down today. walmart of course, stands to gain and they are up. charles. charles: it is a sad day. ii have a great memories of the store as a kid. great memories as a father. here is the irony, i don't have many memories of a grandfather. i have a five grandkids. that proves the point. i don't hardly go there anymore. we find other places to get the toys. reporter: i can never believe you're a grandfather. you still look like you're ready to have more kids. charles: thank you very much. jeff, we'll leave it there, buddy. [laughter]. now to a story we brought you yesterday which has major

implications down the road. the census bureau predicting elderly people will outnumber children for the first time by 2035. social security of course already strained. the big question, how do you prepare? you better be ready for retirement. to the expert retirement inspired author, chris hogan. chris, i have to tell you, the signs are out there. i hope people are paying attention. certainly a change in dynamics, how do you fund something that is broke when you have fewer people out there to fund it. >> charles, you're absolutely right. it is a real problem. it is one of the drums i'm beating last four years, people to wake up and look for this. you can't to on auto control to think it will fix itself is. we have to start taking personal responsibility for our own households make sure we're working a plan that helps us get to where we want to be. charles: you know what i find, chris? vast swaths of people don't believe social security will be there or if it is, government

will have to print up money to make up for it. we know we're living longer and more active in the life-styles. we want our golden years to be golden. people are not sitting in rocking chairs. that costs money. >> it really does. the whole point of social security it was never meant to be the final thing. was never meant to be the cake. i tell people if it is there, treat it like icing on the cake. if it is that's great. if it is not you didn't go all-in on that. average payout is $16,000, charles. 1333. average new car payment 600. used car 420. social security alone won't pay for mortgage or vehicle. that is a problem. charles: so, you travel around the country. you, you're an evangelist for this. what is the main message that works? in other words there is lot of ways people try to alert the public. what do you find resonates with people the most? >> great question. the thing that i have found as i traveled i asked people this one

question, what do you want your retirement to look like? i mean by that are you traveling the country? are you doing mission work? are you doing things with your kids or grandkids, things like that? when people think about that, they start to light up. okay, we need to start working a plan that leads you in that direction. meaning don't do anything that is counterproductive. don't buy a new car, take on debt. don't open up a credit card to take on debt of the those lead you away from your dream. i want you to go toward it. charles: there is this phenomenon, most social scientists attribute it to younger folks, fear of missing out, you only live once. >> right. charles: being in the moment but i think it is happening around the entire country. there is evidence it began a decade ago, people want to live in the moment in part because we lost faith in the future. we had a couple of market crashes, had a housing crash. people say hey if i pour money into these things, it goes up in smoke, maybe i wasted 10 years?

>> i can understand that thought, line of thinking, charles, you and i know the game, we know the process. when you invest the market goes up and it goes down. if you're working the plan that is the seatbelt, right? look at historical markers of the market, it always trends up. so i tell people you can live in the day without living for the day. meaning i want you to be doing things you enjoy now, but let's prepare for the future. charles: from overarching macroeconomic point of view, our economy, 2/3 is consumer spending. this is where we always kind of as an investor, and wall street guy i want people out there spending but we know there is a point where credit cards get to a certain level. spending gets to a certain level. that inflection point where it is too much. i don't know that we're there yet. feels like there is new attitude since the great recession. are you concerned we see savings levels starting to drift much lower? >> i'm scared of all cycles out there of the for example, studies have shown, people have 24% of their income going to

consumer debts, credit cards, personal loans, things of that nature. we have a period of consciousness. then we forget, right? i want people to plug into that, go wait a minute i know what happens. with all the housing market had creative financing. no income check loans, limited income check loans. so that created an issue. i want people to fiscally be aware and responsible for themselves and what they're doing. don't jump on the trend. stay focused what leads you to your goals. charles: ultimately, chris, comes down to delayed satisfaction. >> yes. charles: are americans delayed -- prepared for delayed satisfaction in this era where they're told by every tv commercial you deserve it now. >> that deserve mentality is scary. listen, we can have fun and enjoy things. do it with cash inside of a plan. when you budget it gives permission to spend. you don't do it with regret. when you use credit card debt you bring penalties, you don't need that. charles: live within your means,

prepare for the golden age, golden years to really be golden years. >> absolutely. charles: chris, you're the best. >> thank you, my friend, president trump targeting china with a new crackdown. what kind of role will larry kudlow play in the protectionist agenda? we'll discuss when we come back. . the alerian mlp etf can . diversify your equity portfolio and add potential income. bring amlp into the game. : before investing, consider the fund's investment objectives, risks, charges, and expenses. read the prospectus carefully at alpsfunds.com/amlp how's it going? - alright, how ya doing? - welcome! so, this is the all-new chevy traverse. what do ya think? this looks better than 99% of the suvs out there.

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. charles: welcome to cavuto "coast-to-coast," i'm charles payne in for neil. multinational companies which, like more competitive i.e., meeting with prime minister trade concerns rattling much of the eu. adam shapiro with all the latest. adam? reporter: start with the eu, leo radkoff, the prime minister from ireland is meeting with president trump. they are talking about specifically trade. remember, the eu threatened to retaliate against the steel and aluminum tariff, the president announced with its own tariffs like kentucky bourbon. the united states would then retaliate with perhaps tariffs against irish whiskey and irish whiskey imports up over 20% over the last year. one of the issues they are discussing. but president trump in this

meeting said this -- >> whenever there's a problem, you call. we'll solve it. okay? except for trade. [laughter] >> they got those taxes so low. you're a tough one to compete with, with the taxes. reporter: before we get to mr. kudlow, you should know something about the irish prime minister and the statement from the eu trade commissioner, she spoke with u.s. secretary of commerce wilbur ross, and during their conversation on the telephone, she reiterated that she expects as does the other 28 nation members of the eu, they expect the united states to exclude the eu from the steel and aluminum tariffs. no response if the united states will indeed do that. the president clearly pushing for his agenda on getting reciprocal trade. then you have larry kudlow, not his first time at the rodeo. he was a member of the reagan administration which used

tariffs to negotiate better trade agreements. mr. kudlow said while he is a free trade proponent, he would be in support of president trump's efforts to bring trading partners to the negotiating table if tariffs are the way to do it, he said he would be on board with that, and then you get mr. trump's tweet today which he said we have a trade deficit with canada, there was the issue over the recording made of mr. trump meeting with supporters in california. we have a trade deficit with canada as we do with almost all countries. some of them massive. justin trudeau doesn't like saying canada has a surplus versus the united states, negotiating, but they do, they almost all do, and i know how, i know. surplus and nonsurplus and trade deficits with canada, whether you factor in energy and timber. i'm going leave that to the opinionators to discuss that

one. charles: i'm an opinionator. reporter: you are. charles: thanks a lot. i appreciate it. president trump may propose a package of anti-china measures, larry kudlow is known to think that china is the big issue when it comes to trade. what should we exactly expect? china is the last big target. charlie gasparino joins us now. >> i like the fact he leaves out certain things to make it trade. charles: the trade deficits have been enormous, and canada has its own set of numbers as well, so there's some confusion there, but strictly on goods, no doubt it's huge. >> yeah, i'm happy that trump has this man crush with vladimir putin because he's not going to put any tariffs on vodka, you know i'm a huge vodka drinker. charles: tito's too, isn't that american? >> switch off the russian vodka for tito's. charles: making america great again.

>> that's it. trump wants me to drink tito's, i never thought that. he is brilliant, this man. charles: larry kudlow is he going to help with that or what? >> you know, larry's going to have to suck it up a lot to last -- he's told people that he's looking at this as a one-year assignment. to make it through the one year particularly on trade, larry is going to have to suck it up a lot. and maybe has the intestinal fortitude to do it, maybe not, in his heart of hearts, not even that, he was probably quoted or two weeks ago, i told you, he's starting to soften in the tariffs. he was saying the tariff regime, take china out of it, china is a bad player, that's a whole other dynamic, they steal stuff from us, i get it, every free trader knows they dump stuff on the market. the way the tariffs were rolled out and still be rolled out, there's a lot of -- no know knows. charles: we have the nafta

negotiations to go through also. >> looks broad based and looks like it hurts our trading partners and looks like it hurts us more than helps us and looks like it's out of the peter navarro handbook. listen, i have no personal animus with peter navarro, i'm sure he's a nice guy. he's a former liberal that became a restrictionist on trade and immigration, and that's how he became part of the trump administration. charles: navarro's focus is china. i think he's written five or six books on impending economic war with china. he predicted this for a long time. >> so has steve bannon. wouldn't be so bad if we were ratcheting down from the chinese to stop them from stealing from us. this is broad basid and think that's navarro's playbook as well. charles: let me pose this to you, china can't commit all of the atrocities alone. there have to be people aiding and abetting or looking the other way and perhaps that's another part of doing this way,

letting all the other folks, hey, listen, we know it's us versus china, but they can't dump cheap steel through your nation either. again, back to larry kudlow, where does he come in on this? seems from what i've heard and the clips in the last 24 hours, he's accepted, he and president trump are different on some things, if he can't persuade him, he'll be a team player. >> he's going to have to renege on his core beliefs a lot, if he wants to stay there. for all i know, trump tomorrow will be -- throw out peter navarro and get rid of wilbur, wilbur ross, and become a much more free trader. charles: but he won't. this is not a new trump, this is the president trump that goes back. >> i'm just saying with you, i don't know what his modus operandi is. we should point out trump was never quite a protectionist until recently, and the guys

that came up with that mantra were roger stone and sam nunberg and steve bannon as a political weapon essentially. don't be so sure he's solidified in all these views. a lot of this is politics with him. charles: right. >> maybe he'll disavow it, if he stays on course, it's going to be hard for larry kudlow to stay there. now, larry is an amazing guy, eternal optimist and a really nice guy, really congenial, maybe he can just reason with the president. charles: maybe. >> and walk away. remember one thing about gary cohn, though, he had the gun put to his head. we want to you go out and say these tariffs are good or else, and he wouldn't do it. charles: i equate it to football, you're in the huddle, the quarterback calls the play, the prima donna wide receiver says no, we're going to do this. the quarterback says no, when we go up to the line of scrimmage, you run the play. you're not the one crying

omaha! omaha! gary cohn was trying to change the play. >> if he gives a speech about charlottesville. charles: now you're conflicting a whole lot of things. >> it was a few months ago. charles: gary cohn decided to stay, he decided to stay, as a part of staying, you got to recognize there's one president. >> i know that. if the president does something outrageous and stupid, and you want to suck it up, that reflects on you. charlottesville, all the guys decided to suck it up. charles: that's on them. charlie, leave it there. meanwhile, talk phase two potentially of tax reform, rod shaw telling fbn maybe, listen. >> chairman kevin brady and the house have been talking about a phase two tax cut plan. we want to make the personal income tax cuts in the first tax cut bill permanent. they've talked about

potentially lowering the capital gains rate, and there's other ideas that have been discussed. charles: to former cbo director douglas, phase two in the taxes. what can we expect? there are parts of the original tax plan that people hope can still come to fruition. >> i hope they get phase 1-a done before phase 2. clean up all the details we passed in september, which has fantastic corporate sector and business taxation, i think that's a top priority and help the economy in 2018, 19. phase 2, making the individual provisions permanent. that would be a good idea. if they do that, they're going to have to controlling the spending side and getting the debt under control. we're in a bad position right now. they can't just continue to cut taxes as much as they might like to without recognizing that we're going to start at a

trillion dollars and the deficits go up from there. charles: interesting you say that, no news, no one talked about that february budget deficit coming in significantly higher than anticipated. >> huge. charles: and again, that was a yellow/red flag to your point. everyone who crafted this budget in the tax cuts understood that would be the case, that initially, we'd have to endure pain. but they're saying that supply side economics means ultimately stronger growth that helps pay down that debt and bring it to a manageable point. is that possible with the current circumstances? >> i don't count on the tax cuts themselves putting us in a position to have a sustainable debt outlook. it's going to take a lot of work, but i think it's a correct reading of the political situation, if we didn't get better growth, move from two toward three, it was not going to be possible to deal with the safety net programs, the social securities, medicares, medicaids and put them on a

sustainable track. people who are not confident that job is going to deliver a standard of living, are not going to let you make big changes in the program. getting a growth was a necessary thing to do first, glad that was undertaken, now let's finish the job. charles: to your point, on the political side, the republicans need a super majority in the senate, the house, and also the white house to really enact any true reforms in these entitlement programs, wouldn't they? >> i think you are going after 60 votes in the end, so dramatic reform is probably not on the table at the moment, but some reform has to be, that's not politics, that's arithmetic, and democrats and republicans have to find a way to get there. charles: douglas, thank you very much, appreciate it. growing talk of shake-ups within the white house, the story changing by the moment. we're going to have a very important update for you, right after this.

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. >> there will always be change, it was a false story, a very exaggerated, a very exaggerated and false story, but there will always be change, and i think

you want to see change. charles: president trump saying change is inevitable in the white house, but slamming media stories on white house chaos amid reports that veteran affairs secretary david shulkin could be possibly replaced by rick perry, national security adviser h.r. mcmaster possibly replaced by john bolton and talk of john kelly possibly being replaced by mick mulvaney as chief of staff. is the white house in need of more shake-ups? "the washington free beacon" writer liz harrington and gop pollster chris wilson. liz, start with you, obviously, the turnover rate at this particular white house, something unseen before, but we also have a president that sort of unique as well. >> right, he's unconventional, and i think as the so-called turmoil in the white house is overstated by the media, like they usually do, i think it's the media that can't quite keep up and i don't blame them after

taking eight years off during the obama years, must be hard for them to adjust. but the shake-ups this week make sense, you have rex tillerson who disagrees fundamentally with president trump on one of the biggest foreign policy issues of the day which is iran. if your top diplomat doesn't agree and is trying to undermine you on getting out of the iran deal, i think you have a problem, and it's unsustainable, and i think really the only surprising thing is rex tillerson lasted as long as he did. charles: john, dissenting voices are fine in any organization, when a final decision is made, shouldn't everyone be on board? >> sure, that's right. i think rex tillerson, the switch for pompeo was a good one. rex tillerson was a fairly ineffective secretary of state, with all due respect to liz, i don't think the media created more turnover in this white house after one year than most white houses see in two or

three. i don't think -- you can't have it both ways, you can't say this is unconventional president, and at the same time, say turnover is natural in a white house. the place is in turmoil, the place is in chaos. you don't have to take the mainstream media's word for it, talk to people who work in the white house, talk to congressmen when they're not on the record and speaking freely. the place is pretty chaotic, donald trump fired his secretary of state over twitter. >> no, he didn't. >> he essentially did. >> the story was out already. no, i agree that there is more changes than normal, but the media makes such a big deal over a lot of positions that do not matter. they're obsessed over every single change whether it's hope hicks and all that. >> i agree they were out to lunch for eight years with barack obama, you can't just gloss over the fact that donald trump's management style is unconventional and one of the -- which we all agree on, but one of the things that marches

management style is bizarre chaos and turnover that is unprecedented and unknown in american history. charles: chris, that being said, they are getting things done. >> they are. charles: right, and i think that people need to probably focus on because again perhaps president trump has the ability to not only survive or thrive in such an environment, maybe he feeds on that frenetic activity within his organization? >> i don't know the answer to that, charles, it's an interesting question. is this a disinterest of sharing information with the mainstream media or problems in terms of communication, frankly it could be either one. i don't have internal knowledge from what's going on inside the communication structure inside the white house. there's nothing gone on that you couldn't see coming if you pay any attention to the white house. frankly, the fact that what rex tillerson lasted as long as he

did being rumored to call the president a moron is shocking. the fact he disagreed with the president on fairly fundamental issues. as you see president trump is sort of in his minds, getting his sea legs, getsing tax cuts passed, he is reaching out to candidates for jobs that are more like him or closer to his position on tariffs, trade and other issues. that's what you see manifesting itself right now. charles: right, liz, and again, listen, trump 1.0, neophyte in washington, d.c., was told pick this guy, go with this guy, go with this guy, he gets criticized for listening to folks but did bring on people opposed to core agenda, certainly what he campaigned on, perhaps trump 2.0 is getting campaign promises done. >> right, that's what he said, i'm closer to getting the cabinet they want. the changes that we're seeing, he's getting used to the job more and trusting his

instincts, well, wait a minute, you disagree fundamentally like rex tillerson and have you gary cohn where they have big disagreements also, he's shaking things up because he wants to get back to what he's more confident in the job, i think, and wants to get back to more people that are with his agenda, and i think that's why you're seeing more of the changes now. charles: jonah, helping, hurting or indifferent with respect to getting the job done itself? >> it depends. there's been a lot that's gotten done, i give a lot to the republican congress and senate, mitch mcconnell has been -- i'm not a huge mitch mcconnell fan, but fairly heroic in getting judges across. but there is a downside to what is seen as chaos, when i say chaos, i don't mean just the white house turnover, i mean the tweeting and the fights with jeff sessions and the rest, it turns off suburban republicans who don't like the drama but do like the policies.

these things come at a cost. the rah-rah base loves trump's style, that's fine. there are a lot of people who don't and creates a sense of high drama that turns a lot of voters off and make it much more difficult to get the agenda off if they lose the house. charles: we have to leave it there. thank you very much, great commentary. president trump saying rex tillerson's thought the iranian deal was okay is one of the reasons he replaced him with mike pompeo who is a staunch critic. i'm speaking with one of his fierce critics, joe lieberman next. 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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we help farmers lock in future prices, banks manage interest rate changes and airlines hedge fuel costs. all so they can manage their risks and move forward. it's simply a matter of following the signs. they all lead here. cme group - how the world advances. . charles: president trump tapping mike pompeo to replace rex tillerson as secretary of state, but that leaves questions surrounding the future of the iran deal to former connecticut senator joe lieberman. senator, you were never a big fan of the deal in the first place, and many people were surprised that the trump administration didn't take a harder line against it at its

first so-called bite the the apple. what do you think happens now? >> well, i think the president really was being pretty methodical. he made really clear, and i agree with him, that the iran nuclear deal was a bad deal, it allows the iranians to have nuclear weapons within ten years, which is not a very long time in the history. and it allows them to build missiles, to support terrorism, to carry out aggression throughout the region. president trump has basically said he's given time for congress to act, and now time for our european allies to agree with him on pressuring the iranians to fix what's wrong with the deal or he's going to pull out. i think he is ready to pull out and i think that would be the principled thing and the best thing to do for our national security, and mike pompeo, who i know and like and respect, i think will be a secretary of state who will support the

president in the kind of principled tough policy against iran that will be best for america. charles: senator, i want to follow up on two things you just said. first, how could you fix this deal? and secondly, is it realistic that the europeans will be on board with it considering they seem to get a bigger economic gain out of this new relationship and don't want to forfeit that? >> well, let me say, some of the european companies have gone into iran, but i'm really grateful at how many of the big european banks and other companies have not gone back into iran because they know it's a risky place to do business. the iranian economy is in real trouble. it will be europeans think that the iran nuclear deal was a great accomplishment. i disagree. can we get the iranians to really commit, for instance, to take the sunset clause out of the initial agreement and say that they will never go

nuclear, and given the rewards for doing that, that's going to be hard. that's something we have do and they have to do or else we'll pull out of the deal, impose sanctions on them, and i hope decide we're going to support the people of iran who increasingly through public protests, are showing they want this regime to go. stop chanting death to america, death to israel. they've started chanting death to rohany and death to khomeini. charles: do you think they accepted the deal? one of the things is trust but verify? >> with the iranians if you look at the history of this regime, you have to say mistrust and verify. for me, knowing their history

and the way they feel about america, the middle east, most of it, it would be hard to trust them, so i believe myself that the ultimate answer to the threat that iran represents is the end of this regime and the installation of a regime that the people of iran want and we can help make this happen first by simply standing with the people against the regime just as president reagan did with the former soviet union, and look what happened there. charles: absolutely. >> it ended. charles: let me shift gears here on president trump's pick for cia director gina haspel. facing stiff opposition from lawmakers over her role in post-9/11, waterboarding, senator, waterboarding at the time was legal, and she was doing her job. so is this backlash warranted? >> well, i don't know if i ever really met her, but i've listened to people in the last

few days like the former director of national intelligence jim clapper, the former director of the cia, mike morell, talk about what a great public servant she is, and what a perfect person she is to lead the cia now, so i would say, however you feel about waterboarding, which was legal, absolutely right, i think on balance from what i know now, she ought to be confirmed. charles: and yet rand paul has come out and vigorously said he's a no, and senator john mccain wants to hear more during the confirmation hearing process. this puts a big question mark over this. >> it does, and all i can say is i hope and this may sound naive, but i hope people don't decide based on party affiliation or trying to embarrass the president, but decide based on what's best for the cia and therefore for

american intelligence and american national security, and you know somebody devote a lot of her life to the intelligence community, apparently knows a lot, performed there, you got people of different points of view who know her and support her, so, you know, unless something negative comes out at the confirmation hearings, i would say she deserves the benefit of the doubt. charles: what i've read, people are not sure what political party she belongs to, which is rare for somebody in government to do their job. all of the opinions that come to secretary of state and cia, on the eve of a potential meeting between president trump and kim jong-un, does that change any of the dynamics at all? >> well, it may change it in the right direction, because the president has the right, obviously, to have people around him, number one, she comfortable with, and believes

reflect his point of view. he's got the right to make the changes. i think it may strengthen him as he goes into possible discussions with the north koreans. incidentally, what we talked about first, if we're tough on the iranians in term of their nuclear program, it's going send a message to the north koreans not to play with us. charles: right. >> and so it's kind of a win-win if we do it right. charles: great point. senator lieberman, always a pleasure, thank you much. >> thank you, charles, all the best. charles: the end of era for toys "r" us but not the end of the world for retail. i'm going to explain right after the break.

. charles: fox news learning fbi official andrew mccabe meeting with justice department officials right now making his final case to keep his job. the fbi disciplinarian office is recommending firing the former deputy director over

allegations he misled investigators over authorizing the leaking of sensitive information, he could be fired. days away from being eligible to receive a pension. we'll keep you updated on that as we get more. iconic retailer toys "r" us closing stores for good. all 735 u.s. locations but it's not all retail is struggling. take a look at williams-sonoma and dollar general, sales are skyrocketing, host lauren simonetti on this. lauren, start with you first, we see toys "r" us, they've been in trouble, but i also went into williams-sonoma's earning report and dollar general, dollar general has 14,000 stores, they opened up 2,000 stores and increased earnings estimate almost 50% above wall street. have you conflicting story lines there. >> dollar general is cheap. americans can afford a lot of their stuff.

toys "r" us never competed on price. the issue with toys "r" us, everyone likes to see amazon, amazon, well, yeah, it's also the debt from 2005 leveraged buyout, saddled with the debt, instead of responding to the threat from amazon and investing in and innovating their stores, they didn't have the money to do that so, they lost market share bigtime. i was looking at numbers, they are 13% of the market. so walmart sells a lot more toys than toys "r" us, when you operate as dollar general, all of these expensive stores, you have all of this floor space and not using it wisely, that doesn't help you, you are no longer a show room. if you don't have the traffic, you're not a show room to showcase goods. charles: you know, johnas on the upper end, williams-sonoma is not cheap, they sell a $2,000 steam iron, 15% of total sales, omni channel, figuring out how to survive in an amazon

world. >> it's a little more involved than that. you can't make a fancy cup of coffee on the ipad. the toy business is a dying business because when you go to a store with children in it, you very often see the children paying with ipad and phone as much as throwing a football around and playing with dolls. not that they don't have toys, that is a mature business and going into software, that is not an area toys "r" us can compete. there's a lot of issues, the amazon thing is a large straw that broke the camel's back, we resorted to the 80's-style, that is putting you at competitive disadvantage, they don't have huge bond payments to makers you can't have that and rent and compete. that's a loser, but there are plenty of online and off-line retailers that are packed and doing well. the malls are packed in wealthier areas and a low end market, you can't ship dollar items that easily, i would say

long haul, all the express and might hurt a dollar general. amazon is a commodity sales and distribution system, a high-end store selling fancy stuff in a good mall gives an experience, they weren't delivering that experience at toys "r" us, making debt payments to bond holders, not renvating stores, there was no reason to buy your toy there compared to walmart or amazon. charles: i think they got rid of jeffrey the giraffe. charles: i used to thereby so much when my son was growing up. one day in jersey, they wondered if i played for the jets or giants. i had so many toys, they said you got to be in the nfl. should we take this as a proxy for retail. people talked about the death of retail and the death of the consumer. they are spending different, aren't they? >> retail has changed, the ceo said we're in this for the long haul, we're going to reinvent

ourselves but didn't have the money to do it. if you're competing with the different forces we spoke about, you have to change with the times. not to mention, if you look at two stocks today, mattel and hasbro, they supply to toys "r" us, not only are they losing money with this, the percentage of their sales because they would test toys in the show room of toys "r" us, same for the smaller companies. they don't have the grounds do that anymore, if you don't have toys "r" us. charles: isn't that ironic, best buy in the same boat as toys are us and found a way to survive. thank you, both, appreciate it. dow and s&p on track to snap the three-day losing streak. could trade fears rattle the market? reports president trump could present a package of anti-trade measures including more tariffs. let's go to market watcher craig smith, calling for a crackdown on china for years. craig, apparently, the u.s. trade representative said hey, you know what? we've done a section 301 investigation. china is cheating every way

possible, want to hit them with 30 billion in tariffs, president trump apparently said no, make it 60 billion. can we be too tough in the first salvo? >> i love trump. think about it, charles. he's laying down the gauntlet knowing if he says 60, maybe he'll get 30. yes, the answer is, i think it's proper that we finally crack down on china. i've been talking about it since the 90s when we allow them to join the world trade organization in 2001, i started screaming about it. they're clearly currency manipulators, clearly stealing intellectual properties, not just from us but other countries, that's why i love what larry kudlow is talking about. putting together a trade coalition that we as a coalition can go to china, looking free markets told me it's the wild, wild west. charles: i don't have faith in the so-called trade coalition,

i think europe is done. and i was reading an article, the top 35 technology companies in the world, only three are in europe and they're struggling, nokia and erickson. they are going dominate the world economically. i'm not sure what that means to lifestyle but it's sort of worrisome? >> no doubt about that, china is going to be the largest economy in the world, and we have to deal with that, but in order for them to be the largest economy, charles, they need us as a client, and you can't just abuse your clients forever and not expect a day of what larry kudlow referred to today as comeuppance, you know, charles, when i heard that comment from kudlow, and he's free market tariffs, he's going to have to bend to make this word. when i heard that word, i thought the market should sell off. i don't have a screen in front

of me but i think it's up a couple hundred point. america is not seeing a trade war in the future here. i remember the same thing when donald trump said my nuclear button is bigger than yours, everyone said my gosh, a nuclear war on the korean peninsula. we're sitting down with kim jong-un trying to figure things out. i'm not ultimately positive about that, we're at least talking. so the reality is i think mr. trump, hey, look, i'll leave it at, this charles, under obama's administration we had penny pritsger going to negotiate with xi jinping, i'd rather have donald trump and wilbur ross negotiate for me on a global environment. charles: they sold us $500 billion worth of stuff last year. obviously they've got a lot to lose, and i'm guessig and believe strongly, craig, and you can let me know if you agree or not that china is going to make concessions,

maybe not be $100 billion worth but make concessions that president trump can declare victory and china can declare victory themselves. >> i'm 100% in agreement with you, charles. happy medium between the two. as i said, china cannot afford to lose us as their largest client. we can't afford to lose china. there's a common denominator between the two of us and china is going to say, okay, we got away with it for 20 years, now have to sit down and play by reasonable rules. they're probably going to break some of the rules, charles, but it's going to be a lot fairer than the past, i think it's a good move on behalf of the trump administration for america. charles: craig smith, thank you very much, appreciate it. >> good seeing you, charles. charles: mixed messages on the border and daca deals is. another white house shake-up in the works? we'll have more tonight on 6:00 p.m. eastern on "making money."

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. charles: well, there continues to be mixed messages surrounding the deals, potential deals with the border wall and dreamers. want to go to arizona congressman andy biggs. congressman, can we really ever reach a deal?

feels like that window of opportunity is open but closing also. >> yeah, it's going to be hard to reach a deal, charles, because first of all, everybody is talking past each other, nobody can agree what daca is, do they want the clean dream? daca? no one can come up with a way to fund the wall. the only person giving it traction is free. that makes it difficult as well. i think it's hard to come to a complete deal. i think the democrats are using this as a wedge issue anyway, and trying to hope -- i think they want it to last past the midterm election, to be frank with you. charles: congressman gutierrez saying i'll trade daca for a border wall. i thought this was a seminal pivotal moment, someone who has steep ties to the daca recipients, saying it's a worthwhile trade and still nancy pelosi hasn't budged? >> no, she's dug in, she's

recalcitrant, i don't think she's going to move. charles, i thought that schumer and pelosi would respond to the president's offer during the state of the union address where, i think the number he said was over five million people, and i thought, well, they're going to jump on that and go for it, but they didn't. so we're kind of locked in, and i think that's why you're seeing some of the dream folks, the daca people are protesting the democrats saying you're not getting anything done, you are obstructing things as much as anything. charles: i think they're playing a dangerous game to your point. if you promise a constituent you will do something for them and have the opportunity to particularly in this set of circumstances, they don't control the white house. the house of representatives or the senate, and yet president trump laid out amazing deal, a deal no one on the republican side was anticipating and still, you know what? everyone said okay, it's out, there see if we can get it done. >> right, and look, i'll be the first one to admit, i'm not a

big fan of the idea but thought it was going to come together then and i'd be a speed bump and they would roll through quickly. so i've been surprised at the delay from the democrat side, and i think it goes back to even the original daca time when president obama had both houses including a super majority in the senate. he could have done anything he wanted to, so instead of doing a daca type of deal, they did obamacare instead. if you were a daca person back then, you'd be upset it didn't happen. so they have a long history of broken promises. charles: yeah, i think they like that wedge issue card more than actually delivering on a promise. congressman, i also want to ask you about david shulkin, because a lot of rumors swirling he could be replaced at va, and this is something you've actually been pushing. why do you think he is the wrong person for the job? >> well, what i'm seeing is this is as much a culture

problem as much as an actual process problem. they're not delivering, they're not make deliverables, and i'll tell you it takes someone at the top to change the culture, someone quite frankly who hasn't been in the system and secretary shulkin came from the system, he's wedded to the system, i think they need to clean out the top administrators. they need to get a new secretary coming in from outside, who understands that he or she is going to set the tone for that agency, and you have the veterans who sacrificed so much, and they can't get good care, and in my own va in phoenix, you know, we still have trouble there, they're giving us lip service, but i could never meet with secretary shulkin to talk about some of the problems. charles: and we've heard the horror stories from that and so many others. what about would this harm notion that an outsider, business-type person should be there to cut through the bureaucracy, and it was my hope it would work, i think i agree

with you, the particular experiment has probably run its course. >> i don't think this is the way to go. i think we need to basically clean house at the top. there's a lot of good people, just like in the fbi, talk about the, at the top, lot of good rank and file people trying to get things down. in the meantime, have you veterans here who have serious illnesses. we have people who have cancer. they have the threat of losing a limb or something like that, and i have to intervene, i have two people that that's all they do is veterans' case work in my office, and we can't get the results we want and try to go above our local va, we have trouble get anything support or communication even. charles: it's a shame. it's a bewildering, labyrinth, big budget, and yet they can't get their act together. thank you very much, representative biggs, always appreciate when you are on. >> thanks, charles, good to be with you, again.

charles: microsoft co-founder bill gates is sitting down with president trump at the white house later on this afternoon. you know china is going to be something they're talking about, but we're going to have more details of the meeting right after this. to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today.

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♪ charles: bill gates meeting with president trump at the white house later today gates telling "politico" he wants to address president's america first rhetoric, why he doesn't agree with it.

investor digesting trade worries. the dow may stop a three-day winning streak. i will digest all the messages and what it means for the market at 6:00 p.m. "making money." trish is here. trish: we to have breaking news right now. new report saying that the president is getting ready to slap hefty new tariffs on chinese imports. and they could come right down the pipeline as soon as this week. next week. it is all part of the president's plan to get smart on trade, tough on china, aimed at reducing america's massive trade deficit. is that the reason why we see markets pulling back? i'm trish regan. welcome to "the intelligence report." we have seen a very choppy session. investors worried about the looming trade war with china. all on the appointment of larry kudlow as the new chief economic visor. what is