than people realize. stuart: we'll get first quarter numbers. they will be misleading and that is not great. my time is up. but neil, it is yours, sir. >> thank you, stuart, very, very much the gap used to be excess of two percentage points. but we're going to explore that with my extreme panelists. today "wall street journal" editorial board mary o'grady, making money star, charles payne and my buddy connell mcshane.

i want to thank you for your hard work in my absence. really wasn't that hard. what was your take on the different takes on interest rates over 3%? i know a guy your age, highest i ever can remember it. >> probably. neil: briefly touches, charles, i can remember 10% around the time of the '87 crash. we're a long way from that. perspective is everything and it is rattling folk. >> more than anything else for investors it is about making decisions how you allocate capital living in this world. it has been a long time since we've had rates at this level. you live in a world with zero interest rates or low interest rates. you said it yourselves if investing money, only place i can bet any return or yield is maybe the stock market. you have more competition about that you start to make different decisions. it is a simple as that for the most part.

neil: charles, i know you do on your fine show, but i'm usually commuting home at the time, i'm kidding, 10-year at 3% and s&p 500 dividend yield just under 2%, you start making choices, don't you? >> you do, but also, let's not forget with the s&p you have the chance of capital appreciation. you might buy a stock. fingerprints last year caterpillar was one of my dividend plays. neil: is that right? >> happened to work out. caterpillar and chevron were dividend plays and turned out they appreciated nicely and caterpillar especially, that was one-two win. that was huge. another part of this issue they keep talk about flattening yield curve if we invert and that has been great harbinger and predicter of a recession. feels so interesting on one hand, discussion about potential recession and on other hand economy is so hot the fed has to

slow it down. i can't -- neil: one has to be wrong. >> one has to be awfully wrong. i don't think, still i think this knee-jerk reaction is extraordinarily overblown. 3% yield never derailed a strong stock market rally before. neil: what do you think, mary? >> i would point out, the columnist was saying zero interest rates or bet, actually we've had negative real interest rates for quite some time and if you look at inflation right now, the real rate of interest is less than 1%. it is about .8%. neil: even now? >> you have to take inflation out of whatever you're earning on the 10-year. so i think it is a very healthy sign we're getting back to the 3%. nothing else is free in the economy. why should credit -- neil: i think that is really what the market is indicating here. it is not afraid after 3% 10-year. not afraid of a fed hiking rates a couple more times or maybe even four times this year but i

think what the worry is the trend. are we going to go into something much more higher interest rates because they have been having a party for a long time. let's remember too, there are a lot of people suffered from this. pension fund and people who are on fixed income have been impoverished by fed policies. i think getting back to normal, something normal, this is hardly screaming high interest rate environment is actually healthy for the economy. neil: perspective to the point we originally raised here is everything. in other words, a piece i think in the ft not too long ago, talking about a dichotomy between older broker and traders and younger ones and for the younger ones not predisposed to this it is jarring and they trade accordingly. for older ones not so much. >> i think, even though the timeline of all that, i was talking to someone about this not that long ago, people running wall street trading desks have not fon through this type of environment when they were in a point that they are now -- in other words they

weren't in a management position and or in decision making position and many were junior traders or brokers with a much more outlook and taking direction from above, following orders but there is a little bit of a difference, because when you take so long to go from one cycle or another, if you were 25 something happening and now you're 45 years old, you're much different situation, you haven't lived to it. there is something to that. neil: i wonder, charles, to his point, how you guide your own customers, who have to deal with this, many are young? many are novice, let's say, they have gotten a real awakening with volatility which is back with a vengance. >> sure. neil: sectors looked really strong like technology which are inconsistent to put it mildly. what do you tell them? >> you try to prep people. my experience over last 20 years or even longer, people seem to be, individual investor gets a bad rap. i don't see the panic i would

have seen with shocking new volatility five or 10 years ago. more people are actually asking me hey, what should i buy on the dip? maybe they see buy on a dip work for a long period of time but a lot of individual investors do it yourselfers attuned to the market they're not really panicking right now. they sense opportunity. neil: mary, so many earnings beat expectations. we're still up appreciably over last year. we have comparison of this quarter versus year ago quarter, when we didn't have tax cuts in effect. we'll have three more this year, versus period of time we didn't have tax cuts but are they baked into the cake so to speak? >> they're baked into the cake now but the question is, when the next earnings season comes, can these companies continue to turn in the kinds of earnings they need to support share prices here. neil: yeah. >> keep in mind there is, there is a lot of easy money around the world. it is not just about the fed. the european central bank is still very easy.

neil: you're right. >> i don't think it is time to quite panic yet. i think there is a lot of liquidity sloshing around in this market. neil: let me switch gears a little bit to politics. everyone follows that, we're looking at the midterm elections and this is jump off for anybody here but this republican arizona race where she ends up winning five points in a district that donald trump had won by 20 points a lot of people interpreting that republicans hold on something, if republicans win they win by much more narrower margin? >> i think it is bad from the republican perspective, from the point of view, if you have district where president won by 21 and registration advantage is 17 which is this district. neil: what does that mean? >> 17 percentage wise more republicans registered than democrats. this is run of the mill republican district they should win easily. the only reason i point that out which is different than

pennsylvania 18, democrats had registration advantage driven by unions, that was enough to come home that was enough to flip it to the democratic side. i don't think both houses of congress will flip. i look at betting markets to see where they're at. not necessarily the best predictors, what people are thinking now, 70-30 house side for democrats to take it. that is fairly strong feeling. neil: there was confidence they were getting this particular district. they might be getting ahead of themselves. >> they might be getting ahead of themselves. if i'm in republican leadership i look as this as a win. i think the more important point, to me narrative tore some other special elections hot candidate is and how they embrace and situate themselves. we saw some rudderless, almost recent candidates, pennsylvania, that were rudderless ships almost and only toward the end, sort of grappling who i want to be.

do i want to be a trump republican? i think whoever these nominees are for the republican party have to be very decisive very early, establish what they want to be, and because i think it is all about the candidates more so than the margins of victory right now. >> i agree with charles except there is just one other thing, i think turnout will be so crucial in this election. neil: absolutely. >> i think wild card we don't know about yet is still how donald trump is going to deal with nafta. because the ustr robert lighthizer is pushing and pushing that he will get his poison pills in nafta. he will turn around and give it to congress and put onus on then to either accept it with the poison pills or kill it. neil: you think nafta move would decide the midterm? >> it is very dangerous for the traditional red states because the farming community, and manufacturing community and this is important, the manufacturing community is not in with donald trump. he says he is defending manufacturing jobs. neil: both were apoplectic for

how china thing is going, right? >> for manufacturing at this point so over idea that everything will be built in the u.s. they depend heavily on inputs. >> talking about management for workers? you had a quarter of a million new manufacturing jobs in the first year. i think workers out there, particularly truck drivers, last element of nafta went through, decade after it passed pushed back on mexican truck drivers bringing cargo throughout the united states. that was the last pillar to fall. there are a lot of truck drivers, number one job in 30 states. before they could pick up the cargo at border to bring it in. i think a lot of regular folks, not management, but just people who may or may not be at jobs. >> i hate to contradict charles. >> we all do. >> i have been talking to people from red states, politicians, congressman from red states who say they are very worry did. >> not truck drivers from red states. >> they say they are very

worried -- >> farming communities you're talking about. >> farming and manufacturing. neil: talking about the president's base there, that -- >> i'm talking about people who realize -- neil: you think it changes hands? >> no, i don't think the house is going to change hands. neil: really? >> but they will seriously lose seats. if donald trump blows up nafta, it is going to cost him in the midterm. >> on senate side -- neil: hasn't he already blown it up? >> no. they're still negotiating. neil: technically -- >> no. i think that, robert lighthizer still, the mechanic cans, canadians and american business community has given them many, many ways to gracefully get off the stage and not -- neil: what about the markets, i know it is a mug's game if it did switch? >> if congress switched? a lot is on the tax cut issue and the concern -- i was reading something about this morning, you would have conversations, i think everybody talks about impeachment -- neil: i think it will come close

but i don't think it happens. >> if both houses of congress switch. >> you don't think either one does? >> i agree with you if the house were to switch a lot of regulations out of the way. tax cuts are in place. you would have something of a stalemate. dreams of maybe more action on obamacare and things like that will fade away. but, that would be, that wouldn't roil markets as if -- >> if both switched. that is huge story for the market. neil: a house switch, one you're not foreseeing that would mean more trouble for the president. wouldn't get in a lot of stuff he wants. would be frozen in place. >> yeah. neil: regulatory thing and tax thing that might be fine for these guys? >> my only point is that we don't know, i think that the nafta negotiation is going to affect many, many red states and congressional races. i really do, even though the president is not at the top of the ticket. >> by the way many of those red

states, 10 of them at least have blue senators. those are states, will end up deciding control of senate 10 democrats defending seats in states trump won. neil: connell is optimistic republicans have -- >> they have a very good map. neil: a very good map. guys, thank you very, very much. as we're all talking here we're learning tim cook has arrived at the white house. he was there last night for the state dinner for emannuel macron. he is there now wandering the white house grounds. i'm sure he has a security pass. this would be embarrassing. he is pushing to go slow coming to china when it comes to punishing. that is huge market for tim cook. he stuck up a bromance, i'm not saying the macron bromance, kissing and hugging, don't know where to begin there. they hope to iron out details and what that might include with the chinese. we will have more. the dow down 137 points.

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agreement, especially if you decide to leave it. the past 2025 period in order to be sure that we will never have any talk clear -- nuclear activity for iran. neil: the french president addressing congress short time ago and taking decidedly direct tack that goes in opposite direction of the president of the united states he was diplomatic, nodding his head a lot of the time but this was very much reversal from that position or seemed to be. republican south dakota senator mike rounds on all that. senator, i read it was entirely different president macron today, whether on issue of iran agreement which he thinks can be fixed, shouldn't be shelved, and even on the paris accord, the climate accord, that can be fixed, it shouldn't be shelved either. what did you make of both? >> well with regard to the jcpoa, we paid money up front.

we don't have a whole lot to say whether they get in and stay with the deal, whether they're part of it or not, but the jcpoa is bad deal to begin with. it is still a bad deal and part of it -- neil: i don't think the french president thinks it is a bad deal. >> you're right but here is the part that really concerned me. he suggested that we had signed the deal. now president obama signed the deal. that made it a political agreement. the house and senate have never agreed to it. majority of the house and majority of the senate did not agree with it. if you want to have something which the united states of america is party to, you call that a treaty. it is definitely not a treaty. one of the reasons why it is not a treaty because there were not votes to agree to it. that has to be made very clear to the rest of the world. president obama had opportunity to bring a deal to the united states senate. he did not do it. it is not a treaty. we're to the bound by it. neil: the french president thinks otherwise. what is the deal with him?

yesterday seemed to be sympathetic with the president's position, today, not so much. got more stand ovations from the democratic side than republican side. what do you think? we're all trying to be polite. neil: understood. >> the leader of france is a individual we have good working relationship with. we have a whole lot more in common than we disagree on. there are things we disagree on, you hit with the jcpoa. the climate change and direction forward and how we handle it. that was divisive in the discussion today. it was entertaining to watch the differences and how he did the proposal but he kept us up and down a few times. like i say, we have a great relationship with the people of france but that doesn't mean we're going to agree on everything. neil: fair enough. senator, i would like to switch gears a little bit, the president's choice to head the veterans administration, dr. ronnie jackson is taking a lot ever heat right now. a lot of people are saying,

including sarah sanders a short time ago, some of the latest allegations are outrageous. she didn't specify which one. the president himself apparently hinting yesterday he doesn't know why dr. jackson deals with all of this and takes all of this, though he still supported him. do you? >> i had a very good meeting with him last week. he answered a number of questions. we talked about his strategy in front of the committee. i felt that he should have the opportunity last week to do this. over the weekend chairman isaacson made a conference call with a number of republicans. i understand ranking member tester did same thing with democrats. chairman was very honest with us, and discussed a number of unsubstantiated allegations that have been made against the admiral. he laid out in some detail the types of allegations that were being made. most certainly if they were found to be true, they would be

of real concern before the committee. so we're going to do our due diligence. we would do that whether it was republican nominee or democrat nominee. neil: some allegations include oversubscribing certain drugs. there are charges of angry, alcohol-induced behavior. you know far better than i. if any of those prove true, would you say, doctor, step aside? >> let me say we don't know, we don't know how much it is true or not. we'll wait until the investigations are complete. then we'll make our decisions. most certainly allegations that have been made are very serious and in number of cases, based upon who has made the allegations and based upon what those allegations are, it would give us serious cause for whether or not he would be the right man for the job. it is delayed. we'll certainly not prejudge him but we'll not move forward

without facts being made known first. neil: senator mike rounds, thank you very much, good seeing. >> you thank you. neil: couple of developments we're following of course, not only what happens to the good doctor as he pursues the head of the va here but what happens to nancy pelosi in light of those crumbs comments. apparently republicans are not letting go. get a load of this, neither are democrats. after this. ♪ with expedia you could book a flight, hotel, car and activity all in one place. ♪

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yeah, i'm afraid so. it's okay. this is what we've been planning for. knowing what's important to you is why 7 million investors work with edward jones. neil: all right. you know sometimes you worry about what the well-healed money crowd in the republican party is doing. in the case of one very prominent individual, for time being sitting on his hands when it comes to house races. charlie gasparino has more. charlie, who is it? >> it is sheldon adelson, casino mogul, megadonor to republicans, fairly silent so far in the election cycle as republicans fight to keep the house and in

midterm elections. he has given a few bucks, last year but here's the fascinating thing. sheldon adelson hasn't given a single contribution to a house race since beginning of the year. he has given 15,000, something like, exactly like according to the fec records to his own pac which i guess can distribute stuff. that is pretty much small potatoes when it comes from sheldon adelson. the combined with steve wynn is totally out of the fund-raising business. he was an rnc chair. he raised a decent amount of money last year. gaven a single donation $500,000 to a gop pac amid the sexual harrassment allegations surrounding hill. this has a lot of gop fund-raisers nervous that they will keep up with the dems. rnc has been outraising the dnc so far this year, both at the party level, and from what i understand from individual

races, though i do have to add some of the stuff to make sure the numbers work out but having adelson largely out of it this year, with house races, having steve wynn not there, is concerning a lot of my gop fund-raising sources and they're worried that adelson is sitting back i will not throw good money at bad if there is indeed will be a blue wave. a couple of caveats here. adelson is kind of a fickle fund-raiser. he gives a lot of money, right? but he gives it at weird times. he is not like a guy that will be sprinkling it out regularly. he may be out of it for now, looking to see what is going on. remember last year he gave a lot of money but gave late to the trump campaign at various races. wynn is whole another story. with what is going on with the sexual harrassment allegations, very hard for him to step up to the plate to not draw a lot of scrutiny. there are stories about the fund he gave $500,000 campaign

contribution to the pac, that you know, are they going to give it back? they tell me they will not give it back. he is someone you might want to say, very difficult for him to go, for him to give money but this is a very fascinating story. we'll have a whole write-up on foxbusiness.com later today. looks like sheldon adelson so far give keeping his powder dry. that is a big problem for republicans. he raises a lot of money rand has a lot of stroke in fund-raising circles. neil: to put it mildly. thank you very much. do you hear about the georgetown student who confronted nancy pelosi over crumbs comment is it take a look. >> i'm a small business owners. i know it helped my parents hire more employees. helped us pay off our mortgage. helped put me through college. would you still refer to the effects of this tax plan on average americans as crumbs? >> there are some benefits that some are feeling, particular way

with the tax bill. my question, my statement was really a fuller statement, that says while they provide a banquet for top 1%, they're giving some crumbs to other people. neil: all right. go to independent women's forum senior fellow. patrice, what do you make of that? republicans are harnessing that as political gold. it will resonate with those who have gotten tax cuts or bonuses from their companies. others are saying former speaker is exactly right, this was disproportionately weighted, tax cut to the wealthy and corporations. you say what? >> i say she was choking on her crumbs comment for good reason. it is not entirely true, not true at all. "the washington post" gave her two pinocchios for making misleading comments who are bigger earnings or winners from the tax cuts and any sort of tax increases go into play.

she is conflating 2025, 2027 with 2018. today we see, tax policy center found 80% taxpayers got a tax cut as a result. she is speaking when the tax cuts expire on the individual side. she is being disingenuous. it is a political ploy to get people upset to feed into the class warfare rhetoric. neil: all i know is, when barack obama was president, and of course there were those checks that went out for $40 credits if you will, it was a big deal then, it was. $40 in someone's pocket deemed better than the government pocket. why is it different this time when people potentially are getting a lot more? >> sadly it is different because we have a different president and a president who is republican. i was really touched by this young man who talked about his personal experience. his family business. what it meant both to workers who are new hires as well as to the fact that he is at georgetown, asking that question because of the tax cuts. we have looked at social media

where people have said, not crumbs, used that hashtag to tell the story what extra $100 in the paycheck means for them, extra $25. as women, a lot of women are bred winners, primary breadwinners in the family. these tax cuts are not fictitious crumbs or something for the peasants as nancy pelosi is suggesting. it is economic relief american families are getting to experience. neil: you might be right, patrice. polls can be very, very wrong, i posit that as i ask you this, she and democrats seem winning battle are tax cuts good or not when that is advanced, seems that is support for sort of peaked in high 40s, and never got much better. and i'm wondering if that is a sign whatever their arguments, they're working? >> well i think it has a lot to do how the media portrayed the tax cuts and the way they parse

the data, the way they parse the statistics seems like any sort of earnings, to the top 1% when in fact top earners are still paying a higher share of the income tax burden and that larger percentage of tax cuts are actually going to middle-class families and poorer families. neil: this sorts out next year in the high-taxed states where limited what they can write off. those high earners will be, you know -- kicked in the fannie, won't they. >> they will be feeling it. i think though when people start to look at their paychecks, start to sit down, actually did this affect my family, the answer has to be yes, despite what headlines may say, despite what democrats are pushing as a narrative. i hope we see as paul ryan suggested last week, that the house takes up a bill to extend individual tax cuts provisions beyond their, when they expire in 2025 because i think people need to understand. it is not just going to be in a few years that they're going to

see this big, kind of tax bill coming their way. they will continue to, you know, enjoy these tax incentives and savings well beyond that. neil: when i talked to mitch mcconnell last week, about very issue, taking up measure to make individual cuts permanent, he was camegy -- cagey. said it would be second in in at the apple for vulnerable democrats to vote for the tax cut and even though they voted against the first one to prevent republicans gaining more in the senate than they might? what do you think of that. >> that is interesting. this is game of politics and talking about the election cycle this fall, insuring republicans maintain that lead but better talking point is saying to americans, hey, we are insuring that your tax relief, it sticks around and it is not going to disappear. that certainty goes a long way with a lot of people. neil: patrice, good talking to you. thank you very much. >> good to see you too. neil: meantime there has been a

tim cook sighting at the white house. he is scheduled to meet with the president. he is wandering the grounds. he was there for the big dinner with emannuel macron. tim cook is an international player to put it mildly. particularly places like china the president doesn't go too far on tariffs and what he thinks could be a trade war in the president is not careful. i'm not saying that he and the president struck up anything approaching the bromance that he and emannuel macron has, but, but, interesting he is there for second time in as many days. more after this.

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neil: all right. the president and appeal icon. tim cook, second time in 24 hours, they will meet face-to-face, last night at dinner for french president. today at request of mr. cook. to sort of iron out things on trade and china.

market watcher scott martin, joe durant and stephanie miller. how do you think this will go? >> i think it could go a couple ways. it would be in the president's best interests to focus on taxes. so far we saw him tweet. we've seen comments, they will probably focus on trade. >> now when they focus on trade, first thing, i'm sure, tim cook will be concerned about, don't throw out the high-tech baby with the bath water. did a lot of business there. technology companies do a lot of business there. there is a needle to thread. what do you make of that? >> that will be huge, neil. a large part of iphone are made in china, fabricated there. that is a big deal. don't forget the other big piece is intellectual property idea. a lot of data we send over to china, a lot of idea get kept there and repurposed into their own stuff. tim cook can give him perspective exactly what that works out as far as how apple is dealing with the country.

neil: joe, these technology guys, i'm not saying there politically all one way, i am saying they are politically all one way. they are all slightly to the left. they were not big fans of this president. but they liked obviously the tax cuts. they liked a lot of regulations lifted. so they have benefited to a man and women from all of that, including tim cook. so how does cook go into these discussions with the president? >> he goes in, giving clarity what is at risk for u.s. jobs. that is what the president is clearly focused on and grows in the united states. making clear china's retaliation will be on our technology, and that is our competitive advantage in the world. if the president, if, i suspect tim cook will speak to the president's higher calling of protecting the country, making sure we grow and that requires the constant growth of technology which is asset we

have very hard to have anyone else replicate. neil: stephanie, the president long-argued here, i repeat it so much that people get tired of hearing it, that the chinese need us more than we need them. every stance he has taken in the trade talks seems to echo that. do you buy that? in that the chinese will blink, they will do something to satisfy him? nabe not exactly, everything he wants but, some? it is not pa good chunk of what he wants? >> you know i was probably a little more skeptical than you were initially but we're seeing them blinking right now. we were watching lighthizer. our top trade negotiator and our secretary of treasury mnuchin are heading there now to negotiate. that is exactly what the president intended by threatening these extremely large tariffs. neil: you know, you could look at all of this, scott, wonder what is the fallout for technology in general? we'll get facebook earnings after the bell. there is a great deal of scrutiny of all these guys where

some technology giants have been taking it on the chin, including amazon. is it your sense that their go go bull times ended or at least slowed? >> slowed is a good word, neil. tech has been really bumpy last few months and weeks. we had a facebook hearing a couple weeks ago and that knocked down the facebook stocks and shared so much information and shared it to our detriment maybe. if you look at tech among all the s&p 500 sectors, tech how we own it and express it in our portfolios has the most earnings power, best cash flow going forward here. if you're looking taking cash off the sidelines i would put night tech on some of these dips. neil: as you remind me, joe, you don't lose money until you sell or cash out something. some are looking at holdings, some corrected 10% or more and said gee, maybe i should get

out. how do you advise clients in general given the volatile markets particularly in tech where the volatility is really pronounced? >> well, first of all it is the area where you can grow but what is causing this decline is very clear to me and us at united capital it is deregulation. epa protects consumers from environmental issues,sec from financial issues, fda, food and drugs, we'll have a data regulation agency will be created. it might not be tomorrow. might not be with this congress but it's coming. that will be a tax to a lot of these data companies. it is unavoidable. it is an area where consumers are at risk. it is government's job. it is coming. we have passed peak earnings growth, the exponential growth. we're in geometric growth. starts to look a lot more like apple than the facebook we've seen for the last three decades.

neil: guys, i want to thank you all very, very much apple and technology stocks taking it on the chin. apple out after the bell. the gap between those two treasury notes, bonds, whatever you want to call them right now is narrowest it has been in sometime. a lot of people say that could presage a slowdown or worse. doesn't happen all the time. with every single recession we've had since 1974, it has happened all the time. that is phenomenon to watch. no one is jumping on that. we're just following that. the dow down 54 points we'll have more after this.

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hospital that accepts medicare patients. whether you're on medicare now or turning 65 soon, it's a good time to get your ducks in a row. duck: quack! call to request your free decision guide now. because the time to think about tomorrow is today. ♪ neil: all right. this president has run into a buzzsaw of criticism from a judge, and potentially from the united states supreme court. we're watching both developments when it comes to daca, the travel ban. blake burman at the white house with more. hey, blake. reporter: keep in mind on daca a federal judge ruled that the president, administration can not unwind the daca program. what happened last night, the ruling in a district court here in washington, d.c. took it even a step further saying that the president and administration must accept new applications for those who qualify under daca protections.

however, this will not go into effect immediately as the judges put a 90-day hold on the decision so that both sides can continue with their legal cases. this was hailed, celebrated by the dnc, the dnc head tom perez saying in statement afterwards, quote, once again our judicial system rejected the trump administration cruel and unconstitutional decision to end daca. this decision is another important victory, it is urgent that congress take action to protect dreamers. the department of justice says they will continue to fight this. daca was implemented unilaterally after congress extended benefits to the same group of i illegal aliens. as such it was unlawful circumvention with congress. this comes as the supreme court taking up different immigration case, that being the travel ban 3.0, the third iteration that the white house put out. one of the central issues of all of this was the muslim ban that

the president called for, a complete total shutdown during the campaign. in fact one of the justices, justice kennedy today, brought that up saying quote, is anything said in a campaign relevant? the conservative justices though seemed to be siding with the president on this one, neil. justice alito, for example, saying that the five countries that are involved here make up just 8% of the muslim population. neil? neil: blake, thank you very much. jessica vaughn with us, center for immigration director policies studies. jessica, where do you think all these battles are going? >> well you know, if i were a member of congress i would think i would start to be a little upset that the judiciary branch of the government is starting to basically take the lead on immigration policy it seems like. and really, you know, congress needs to start getting into the act and taking back some of the authority that the constitution gives to congress to make our

immigration laws. that is really the best solution to this, is that they need to get out of their own way and start figuring out how to pass some laws that need to be passed, whether it's on, you know, clarifying things like sanctuary policies and what's permissible, or the asylum system that would help the executive branch and the trump administration deal with, for example, this caravan of people who are apparently now in the vicinity of the border and ready to make a scene and kind of test our laws. and to give the trump administration the resources to enforce the laws that congress passes. so i mean, this isn't what our founders envisioned for immigration policy, to have it be made by federal judges. neil: but it is to your point it is what it is. i have to ask as the caravan approaches depending numbers, 750 to 1500 strong.

i don't know what it is, it should be termed caravans, there are groups largely coming from places like honduras who are allowed into mexico and brought to the border to instigate something. i don't know what the truth is. i know part of the strategy part of getting national guardsmen at the border was to deal with this. is that a bit too provocative? >> no. i don't think so. i think the idea is to send a message that if you think you're going to leave this caravan and try to come across illegally, you're very likely to be caught and returned very quickly. now the caravan organizers have said they intend to send people to the legal ports of entry. it is obvious that their intention to make a scene. and they're kind of using these migrants who have come along believing that they will be let into the united states. neil: but who are they, jessica? these migrants are far from exclusively mexican. who are they?

>> mostly honduran, apparently. most apparently left for economic reasons. there is a lot -- neil: looks like the mexican government hasn't done anything to stop them. >> no. neil: they're behind instigating whatever comes at the border? >> they have actually issued these people in the caravan travel documents so that they could travel legally through mexico, but very importantly, also, the mexican government felt that it needed to make it clear that these people could apply for asylum in mexico. that is going to be very important to the trump administration efforts to deny these people admission to the united states because they can simply say, look you had your chance in mexico. there is no reason for to you be here asking for asylum on u.s. border. we have no obligation to let you in. that could be very helpful if they do stick to their guns and

say, we're simply not going to allow this stunt to succeed because that will set off, who knows how many more caravans who will try to do the same thing. and american communities simply can not accommodate endless groups of thousands of people coming here to settle here and bypassing our legal immigration system. neil: on and on and on, wave after wave. jessica, thank you very much. very good seeing you. jessica speaking here, taking a look at corner of wall and broad. the dow down 68 points. interest rates backing up a little more than a tad, getting used to three plus something percent on the 10-year note. a lot of people are saying which wins out? we're on it after this.

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. neil: all right, stocks continue to swoon here, but it's the yield on a 10-year note worrying a lot of folks. things are tied to that including borrowing rates, mortgage rates and they're going up. a lot of savings rates are going up. there does seem to be a lag if we see that and see these and the like. i don't want to get too distracted. kristina partsinevelos to sort of break down what's going on and what's moving or shall i say not moving the markets? >> reporter: right, the 10-year yield, haven't seen it this high in over four years. overall the concern is what does it mean for other interest

rates and other debt instruments because usually the 10 year is essentially a benchmark for car loans, mortgages and the expectation for market participants is that the fed is going to increase interest rates, three, four times this year as a total. and what that means is borrowing costs for companies are going to be higher. the companies will have to put money towards borrowing costs as opposed to investing in the company. increasing salaries, paying back dividends to shareholders. there's two major viewpoints, the yield and how fast that's climbing on the 10 year and could lead to a market crash, and the second point of view is the market as a whole, we've had low rates for so long it's a good thing, a good thing we're slowly starting to see the 10-year yield climb higher. we have to mention the 2-year yield climbing to 2.5% over the last little while. nobody is talking about this. flattening of the yield curve,

seeing movement there. and another big driver, earnings, earnings growth, double digits around 19%, strong across the board and you see markets fall on news of that creating correction territory and the dow earlier this morning, let's talk about boeing just because we're going to end quickly. boeing strong earnings again, beat analysts expectations, earnings per share at $3.64. big beat, the company says going forward they have a positive outlook, and yet it's still not able to offset the drop in the dow today, partly due to the 10-year yield climbing again above 3%. neil: the back and forth continues. kristina, thank you very, very much. interest rates are backing up for a reason, namely, because the economy is in good shape and improving here, and a perspective on this, there was a time briefly in 1987 the yield of the 10-year note eclipsed 10%. i'm surrounded by young people at fox business, when i tell

them that story, tell us again about the double digit 10-year note, neil. this next fellow probably does remember, douglas holtz ekin. it's what you're used to, people including the young traders who dominate wall street don't know that, this is all they've known and they get alarmed, should they? >> i don't think so. it's good news if you are an investor, bad news if you air borrower. not all interest rates are created equal. as you pointed out the markets and the fed recognize the economy stronger. if you have higher interest rates, have you more money, that's a very different story than if they slow down the economy and going in the opposite direction. >> the other worry is they go higher and faster even higher because of the debt and financing through treasury, bills, notes, bonds, that sert of thing. do you worry about that, the cost our debt?

>> no, we're not in a range that's going to show up. in the big picture i worry about. too much debt, i'd like to see a lot of it go away. neil: we can refinance. >> we can refinance and manage what we have now. the thing to keep the eye on is how fast is the main street economy going? if the main street economy is fine, the stock market will be fine, if it isn't fine, the stock market won't do well. neil: if you look at the anomalies of the 10 year and the 2 year, some say that can preview not so pleasant things, a slowdown at the least, a recession at the worst. what do you think? >> i don't think we're in the territory of recession. there are formal models the probability of a fifth to lower. that's about right. the truth is we're coming out a period of extraordinary monetary policy where, market signals really got suppressed by the fed. they bought up all the debt. neil: do you think they can get bypassed, they too can get

through this. they created this 10-year rate policy, even though they balanced it halfway, i guess. they risk getting caught behind. >> they risk getting caught behind. there's no question. of the risks you want to take, would you rather have the economy booming, no real sign of inflation or we're not going to get behind and cut it off too quickly. they'll air on the side of moving gradually. neil: two or three hikes. >> i think so, yeah. neil: what about inflation, you want to be ahead of the curve, ahead of inflation, don't get behind because it could be fatal and all that. how are they doing or we doing as a nation on that? >> it's all about goods prices. services inflation has been right where the fed wanted it since the beginning of the recovery. we've had massive deflation in goods, largely traded goods, as those firm up, the fed will have to move. neil: what happens to housing in an environment like this? i was surprised by the statistics that housing is at

its busiest when rates are climbing, not declining, they are climbing now, do you expect that to continue? >> two different things going on. one is the refi, rates go up, last chance, i'm going to refinance my house. lot of activity from. that the underlying construction and sale of new homes is sluggish, and there's concern that there really isn't enough supply of houses. that seems largely dominated by the coast, the new yorks, washingtons, boston's, san francisco, seattle, san diego, where local laws make it hard to build, and that's cliving up home prices. neil: the president and trade talks with china and elsewhere. tim cook meeting with the president today, and he's concerned about it, obviously sold a lot of stuff there, makes a lot of stuff there. should he be worried? >> i think there's reason for concern because we don't know what the end game is. the administration never really said this is what we want and this is how we'll know when we get there, and that will be a

great plan if you could figure it out. in the absence of that, you should have left thinking how does this end, and if you got a big book of business associated with china, you have to be a little concerned. neil: when you were congressional budget office director, how much did you weigh stock market into your computations? >> none. neil: really? >> it was gravy if it ended up being more than expected? >> on the revenue front there was one piece that mattered a loed, the taxation of options and bonuses. particularly new york city in the late 90s with the dot com boom, all that money flowed in, and when the boom ended and the dot com bubble burst, the money didn't show up. big parts of the revenue swing in the federal government. in terms of the health of the economy, make sure people are getting up, going work, getting a job and getting a raise. neil: that was the internet boom. that made for surplus. >> that's how we balanced the

budget. people say i want to balance the budget. how? do we want another bubble bust. neil: without that, would we have had the surpluses? >> no. neil: really? >> a huge, huge shift in revenue. you would have taken all the revenue collected in 2001 and 2002 and jammed it in '97, '98 and '99. neil: i remember it well. >> as the 10% interest rates. neil: widely respected on both sides. douglas, does that strong bond between president trump and emmanuel macron mean there's a different thing going on right now between the president of those two countries? i got a sense today from mr. macron he was dialing back some of the stuff he was telling me yesterday, i could have been imagining it. this young lady in the audience there. tennessee republican congresswoman diane black. good to have you. there were more democrats standing up for things macron

was saying, including sticking to the paris environmental treaty, the climate accord, sticking to the iran deal. go ahead, fix it, don't jinx, it don't just junk it. a a lot of applause for that. i didn't know among republicans, what do you think? >> i think what we're looking at is a great relationship between the president and president mac own, and i'm excited about that because we need to have good relationships with our foreign partners and this is one where i believe at the end of the day, even with some of the differences that we do have it, is good to have the strong relationship, considering a world that is very dangerous, and that we can work with someone who has a very similar idea such as us. they obviously differ on some big things like the climate. neil: it was a lot more noticeable before congress was speaking and maybe the crowd to whom you speak, versus speaking to the president yesterday, maybe i'm overanalyzing, this

but which is the real emmanuel macron? >> i think what you saw when he was interviewed this past week and we saw in his own country, we saw him being interviewed, and he really showed us who he is about the concern for the middle-class people, just as president trump is here in our country. there are some big issues that i believe that the president and macron will be able to come together on. but we have a longstanding partnership, and this is a partnership that goes all the way back to the time of the revolutionary war with lafayette, and also us during world war ii. this is a good relationship for us to have on very big issues where both of them can find a way to talk through the differences and at the end of the day come out strong, and president trump is strong. he has said america first, and we see that is happening all throughout the entire world including in north korea. neil: you are quite right. media called it a bro-mance, who would have thunk, as they

say. it heralded back to me and reminded me of the reagan-gorbachev relationship, odd at its first appearance but key breaking down the berlin wall. and richard nixon with mao tse-tung. the inroads they made together. is it your sense could this be another type of relationship, obviously, very different in terms of economic ties. but where do you see it going? >> i think for me and maybe because i'm a female and look at relationships and it is a part of what i like do is looking at relationships. i saw a commonality between the two of them, very strong leaders, neither one of them were expected to win their elections and both of them are very concerned about the middle class. and they're willing to go up against a wall of media that is going to sell them in a very different way than what they're really about and willing to stand for that. and i think that was pretty

clear on what i saw in the interview that was done with macron there in france. neil: i agree. and you are always surprised. people find common ground on the unlikeliest of issues and matters. thank you, congressman, good seeing you again. >> thank you, good to be with you. neil: speaking of unusual meetings, talk of a bro-mance of sorts, tim cook and the president in so many days, the president meeting with him to talk about china and concerns about going too far in the tariffs. we think. obviously the apple ceo has a lot on the line there and interested in making sure the president hears what's on the line there. he asked for that meeting. the president gave it to him. more after this.

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the manufacturing facilities to churn them out to. charlie gasparino, "wall street journal" editor james freeman and last but not least, deirdre bolton. these guys have struck up a rapport. i get the sense the technology industry is pushing them along. >> pushing them along, apple in its own right spent about $2 million in the first quarter of this year lobbying. >> is that right? >> yes. spending time in d.c. >> lobbying on the china thing. >> wanting to be in the room, wanting to be on the conversation on trade and tariffs, china is a huge market for apple. last year it got i think around 17% of revenue from china selling iphones there. tim cook does not want any increased tensions with china but does understand, i think he does understand the position the president is in and the position that the u.s. is in. last night, there were a couple shots and people saying on twitter they felt tim cook looked uncomfortable upon

arrival, and that this might be a little more fraught than the average conversation, we'll see what happens. neil: james, we're told tim cook asked for this meeting, the president granted it. the president is encouraged with the jobs commitment apple made here and everywhere. so it's not as if he has any of the acrimonious relation that he does with jeff bezos and amazon. where do you see this going. >> i think it's interesting because we normally think of china as the manufacturer and the exporter, as deirdre points out this is a huge cell phone market, the world's largest smartphone market. i'm sure what mr. cook is thinking as he goes in, given his role in the technology industry, he'll have a million stories if he wants to tell them about chinese government efforts to take technology and trade secrets away from u.s. companies. but he also needs to sell there, so i think he's probably trying get assurance from the president on the game plan where we can get rid of the

theft in china but not close down that market. >> do they build it here and sell it there or build it there and sell it there? >> the guts are developed here, a lot of assembly happens in asia, and this is where -- why it is important, i hope people ignore the trade deficit numbers in the sense that often things will be counted as imports into the u.s. an iphone might be an example where the guts of it have really been created here, and so it's -- >> and the president -- i'm sorry, deirdre, but the focus on that, by the president, could be to his detriment? >> just like macron yesterday, i assume mr. cook is hoping the president will get away from trade deficits as the problem and focus on intellectual property theft, getting rid of that, having open markets and the economy is going to grow, whether or not the exports and imports --

neil: keeping their work. >> since we're in this bro-mance theme or meme however you want to put it. trump gave cook a big wet kiss with the tax bill. they have the foundation for a great relationship, right, because of that, the money that's going to apple. the repatriation stuff is really, really beneficial for apple. so they have a foundation for a conversation. and, you know, one thing about tim cook, he looks uncomfortable everywhere. he's not -- he's never been a guy that looks comfortable on stage. >> when you talk about the kiss to the tax bill, i mean, maybe if president trump hadn't addressed it at all, apple could have kept functioning in ireland for example, and quite frankly never paid or never repatriated that money? >> i think they like the fact the liberals like cook who is moderate liberal like the tax

bill. neil: is this live? that's tim cook walking into -- >> by any measure they think the corporate tax cut benefits them over setting up shop in ireland. they have a basis of a relationship, and when you have that basis of a relationship like what he has with macron. another bro-mance. by the way, macron is a good-looking guy. neil: as is mr. cook. i don't know where we're going. >> when you have that type of relationship, it's easy to find common ground. james and i were talking about this earlier. neil: bro-mances? >> about how good looking you are? >> if you were to pick the one guy you never thought trump would get along with, it would be macron, right? neil: yeah. >> and the other guy is tim cook, i hear they get along okay. neil: well, he's not as dogmatic, right? that is tim cook, there is something he can be flexible on this stuff which made him such a survivor in corporate america did. he have trouble finding the

west wing. he's walking a long time. here's the door! here's the door! [laughter]. >> i think bro-mance is probably too strong a word for the emerging, burgeoning trump-cook relationship. they have big differences on immigration. neil: charlie was right on this. forget about just apple, but the technology industry, all the industries, the president a big old thank you for the tax cut some, in the technology industry say no, no, no, he's not going to get a big old kiss from us, but how do they respond? >> i think cook is instructive. he didn't give a big thank you to the president. what he did was he said we are going invest more in the united states. so he's someone who is responding --. neil: welcome the rollback in regulation. >> they're closer on immigration than -- >> with the h1-b visa.

>> aside from the nitty-gritty details. one thing the technology companies want, they want to be able to import people with ph.d.'s from india. so trump, if you look at trump's immigration policies, it's much more about skill sets coming in, and i don't see them being really that far apart. the implementation of that h1-b visas, they're going argue. the broad stroke is both silicon valley and trump have it right on immigration. neil: >> but there's three big themes they need to talk about for apple and the entire silicon valley. the visas and how much the companies make in china and the stolin ip. >> yes, trump is focused on skills based criteria, i wish he would raise the limits, raise the numbers, increase overall immigration. if you want to argue, geared

toward that which benefits us economically. great. but i don't see the desire to bring the -- neil: have to say this on the issues whether you say if it's the proper response. he reminded people, i didn't know china rigged the markets or the european union tried hard to keep american goods out. he had americans scratching their heads and said that doesn't seem fair. >> there are questions here. >> i'm not saying he has time to respond to it. >> if you want free markets there's a question whether negotiations will get us there or raise tariffs and be a negative. it's worth asking the question now 20, years after we invited china into the community of trading nations, the government backslid in a number of ways, we thought it would progress more toward democracy and freedom, you have to question why the world's second largest economy calls itself a

developing nation and can get -- neil: and people know that until we remind them of that. >> let's be clear, is it really a shortage of engineering ph.d.'s in the country. >> if you listen to the tech community, yes. >> they want as manies they can. neil: that's why they go into the field. they realize they are gouged. why would you not want to use our advantage if you had it. >> these are the smartest people in the world. >> if you build a business here. >> we have a lot of good schools here and americans with ph.d.'s. i don't know. neil: america ph.d. guys, thank you all very, very much. dow down 75 point. interest rates continue back up and facebook earnings after the bell. that could telegraph a lot for the technology industry. we're on it. more after this.

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. neil: all right, guess who's back on capitol hill to testify. jeff sessions, the attorney general, edward lawrence has the latest on that and what we can expect. reporter: good afternoon, exactly the senate or attorney general will be in front of the senate committee that controls the budget for the department of justice. now what sessions wants to talk about on the hot seat here is the fiscal year 2019 going forward. what he will get is grilled about questions about rod rosenstein. now the president or the attorney general has accused himself from the russia probe. the president has criticized rosenstein for letting mueller to go outside the bounds of collusion with the russians in the presidential election. sessions will get peppered with questions about why he's not recusing himself over the separate investigation with michael cohen. the president's personal attorney. the president furious that cohen's office, hotel room and

apartment were all raided by the fbi and gathered evidence which included sensitive material. he's being investigated because of a separate investigations over campaign contribution finance issues related to the $130,000 payment to the adult film actress. sessions will defend the president's travel ban going forward, that was discussed in the supreme court. travel ban input travel from the united states from eight countries. six of those being muslim. the supreme court took up the oral arguments this morning. neil? neil: thank you very much, ed lawrence in washington. a caravan is arriving on the u.s. border. mostly hondurans we are told. numbers are difficult to pin down, 750 to 1500. the caravan that there are multiple caravans, wave after wave of illegals. this time extending beyond mexicans that's gotten the

nation's attention, it's the impetus for sending the guardsmen to the border. let's get the read on this from lindsey francine. how big a deal is the caravan as it gets to the border here. what do they plan to do? >> well, from the information on the ground, it looks like many of them are going to try to seek asylum. contrary to popular arguments floating around the u.s. doesn't turn away asylum-seekers, it turns away people filing for asylum who didn't fit in the framework of u.s. asylum. they will get a chance to file for asylum. the problem here is it's difficult to prove that you are being persecuted. you can say i'm under threat, i'm scared, persecuted is the word you want to prove. while cases are pending, many get released and don't show up for hearings. that is one problem with asylum seeking, and that is one big worry on the ground. neil: if many hondurans are

escaping what's going on in that country, why can't the mexicans take them in? >> there's plenty of guatemalans, cronyism is huge there as well. honduras is terrible and the mexican government is offering documentation and support about, you let's get real, i don't think a lot of people in the caravan trust mexico or want to stay there, and enrique pena nieto has not come out strong enough in support of these people. perfectly willing to act as a conduit and he's not taking kindly to trump's words about that. >> so he's more on the side of allowing illegals into his country who can pass through his country to get to our country than he is with solving the problem? >> that's how it appears and interesting to note that when president trump brought up the fact that this may be brought up in the nafta talk, he pushed back very hard. look, if mexico wants to deal in human trade and trafficking and not do their fair share,

this may be brought up in nafta. very interesting point, and pena nieto did not like it. neil: i'm wondering what the guardsmen we're sending to the border do, and correct me if i'm wrong, they're going to be unarmed, so they're facilitating at the border, but what does that mean? >> it appears right now that the guards are trying to deal with optics and providing safety and security for united states. one of the big arguments right now is guards at the border in california. two of california's three largest counties recently, san diego and orange county have voted to support donald trump's lawsuit to allow a federal troops to guard the border. that's a big situation happening in california, and can you get the resident six million people in those two counties are watching this closely to see the sanctuary city argument on the back of when this caravan crosses the border. so the nonarmed guards, i feel,

and people feel who are watching and analyzing the situation, it's a case of optics because the media is there, the nonprofits are there, the governments are watching, and it's unfortunate that the system doesn't seem to be working and in full effect right now. neil: lindsey france, thank you very much, good seeing. >> you thanks a lot. neil: have no reason to doubt the caravan is about there. the question is what happens now? so we're keeping an eye on it for you and a lot of you are reminding me, there are multiple caravans with multiple groups of illegals, not just from mexico, making their way. but that is not a lot different than what's happened in the past. what is difference is the fact that the mexican government may be counting it or supporting it. people are wondering about it. we'll keep you on top of that and the dow just turned positive right now with interest rates over 3% here. now a lot of that has to do with the notion are we going buy the fact that higher

interest rates mean a better performing economy? in other words, things are humming along that's why interest rates are higher? no way to firmly peg anything in the market to just that, but if you are looking to buy a house, either refinancing the one you are in or financing the one you want to get in. this is not exactly the wind at your back. after this.

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. neil: you know i always sound like a broken record. the 10-year treasury yield, we get it neil, we get it. there's a battle between stocks and bonds and you always wonder at what point people say, know what you? i don't have to risk being in stocks if i can go to the safety of the treasury note. uncle sam backs it up. what's more, the yield on the s&p 500 dividend yield around 1. not quite 2%, we're

narrowing that gap. this might be a wide move to make. the same applied to real estate, a lot of mortgage rates are attached to the ten year, different flavors as you know, but those rates have been moving up. short-term rates moving up so what's going to happen to real estate as a result? so far, so good, real estate specialist katrina camp is on that. is there a breaking point and the unique case where people say no mas, this is getting crazy, i can't do this. >> buying a home is the biggest investment that most americans make in a lifetime. so people are concerned that interest rates are going up and think that eventually at some point buyers are going to get out of the market. we have not seen that yet because as of right now we're only about .5% higher than december which when you calculate the difference in costs, it's about $15

difference a month for every 100,000 borrowed. i think the rate changes are more psychological than they are scientific, however, a lot of economists believe that rates are going to continue to go up and i think once they hit the 6% mark, mortgage rates, not the treasury rate, but once mortgage rates hit 6%, i think it will affect. right now i think it's just incentivizing buyers to jump into the market and buy something before rates continue to go up. i don't think they're as affected as -- right now the raise are 4.66%. if they reach the 6% mark, we're going to see a difference. one thing that's more challenging for buyers is the fact there's very little supply so prices are continuing to go up. and a lot of millennials are actually competing against the older generation which is trying to downsize for home. i think that's more threatening right now than interest rates. but at some point in time it

will definitely affect the market. neil: it depends at what price point for millennials looking for starter homes. at the upper end it's been problematic, right? >> in the upper end, i'm seeing a lot of cash buyers, because there is a lot of cash on the sidelines, and a lot of people in the stock market seem to believe that even if interest rates go up, people have to put this cash somewhere, especially institutional buyers and so forth, so this cash has to either go into real estate, into the bond market and the stock market. and people are now loaning actually i'm seeing a lot of big companies loaning consumers. so they're doing short-term loans for people that cannot get financing. seeing a lot of that in the market, and i'm seeing that a lot of buyers are entering the market and they're not actually leaving but it's incentivizing them to move forward, especially people that are buying homes under a million dollars. people that are buyers that are

actually in the market wanting to buy a five to ten million-dollar home, they're buying cash and taking advantage of the fact it's a buyers market in the luxury market, under a million, very low supply. florida is completely different than the rest of the nation. neil: i was going to say. you are a whole different breed. katrina campinis. thank you. >> thank you for having me. neil: the french president in town, he tells congress i have serious differences with the president when it comes to the climate accord, the iran deal. some people said he made a 180 today. regardless, the made in france, after this. welcome to the xfinity store.

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. >> i think we have to start working now on this four pillars to build this new comprehensive bill and to be sure that whatever the decision of the united states will be, we will not leave the floor to the absence of rules. we will not leave the floor to this conflict of powers in middle east.

we'll not fuel ourselves, increasing tensions and pass into war. neil: what is french for fix it don't mix it. the message from french president emmanuel macron, he would much prefer the president and this country taking the approach to fix the iran deal and making it better than junking it and starting from scratch. the former presidential envoy to iraq and so much more. the chairman of the committee of terrorism ambassador paul bremer. ambassador, what do you make of that distinction he's making here? fix it don't nix it. the president wants to essentially nix it. >> well, i think it is reasonable to say we should try to fix the two greatest weaknesses in the iran agreement. first, it's unconstrained ballistic missile program, which for now is under the constraint of a security council resolution that said pretty please, don't do that anymore. and the more important problem is the waxing of iranian

authority in the region. those are the two things that i think are among the things that could conceivably be put in a new agreement. neil: you know, the president has always hated this agreement, he said campaigning, he would nix it, tear it up, he said that of a lot of the agreements. pragmatic when it comes to trade accords, being against the trans-pacific partnership but opened to revisiting it. i'm wondering if the same applies to the iran accord. what is your sense? >> well, it's possible, but i think one should be realistic. i don't think the iranians have very much interest in amending this agreement because they will know that the russians and the chinese who are both parties to the agreement are not likely to support it and then there's the question of germany, angela merkel, the chancellor will be here at the end of the week and she's in a much weaker political position, germany is much more distracted than was the case a year ago.

i think the prospects for getting a broad european agreement are not terrific, and it's worth trying just to keep the europeans engaged. i don't think it's likely to result in much. neil: ambassador, what's to make the iranians renegotiate? they've got a lot of the money, most of the money already, what's the incentive? >> i don't think they will. that's what i just said. i think the iranians have very little incentive. neil: i guess what i'm saying is if we are the only ones open to nixing this thing and europe either won't or can't, then what? >> well, i think we need to step back here, neil. we have interests in the region as the president recognized yesterday when he said while we're leaving he wants to leave behind strong and lasting footprints. i guess i would say you don't get footprints without boots on the ground, and secondly, you don't get a lasting effect untethered to a regional

strategy. we need a regional strategy directed particularly at the problem of the waxing iranian authority. that means figuring out a way to change the balance of forces on the ground, and we do have some people who are willing to help us with that, possibly even the french. that's the thing that will eventually, if anything, get the iranians' attention. neil: ambassador, what did you make of the president, and i'm paraphrasing here, we spent 7 trillion in this region, in the middle east, and got nothing for, it we're worse off for it. what did you think of that? >> i don't know where the number comes from. i don't agree we got nothing for it. we certainly have a problem in the region that we didn't have before, which is iran's move, basically an ancient persian dream from the zagrose mountains to the mediterranean in the west. we have to find a waytor

counter that, using what forces we can. neil: on the trade matter and the chinese, the president says it's time to extract concessions from them, the apple ceo meeting with him as we speak, ambassador, i'm sure just to say be careful on this. obviously apple has a lot of business over there, makes a lot of phones over there. sells a lot of phone over there. how far can the president go on this without igniting problems in other areas. he says the chinese cheat, they need us more than we need them, and i'm expecting them to make some concessions. are you? >> well, i think it's clear that the president does a lot of his negotiating in public, and it's hard to know how much of the things that are said are the actual bottom line. i don't know. certainly we need to try to work with the chinese on trade. more importantly right now, i think he's going to need

china's help if we get some kind of arrangement in north korea whenever he meets kim jong-un in the next month or so. so there are a lot of balls in the air in the relations with china, among which is trade, certainly. neil: so when he is doing the novel, you know, things to get the chinese to concede, when his course with the north korean leader is a totally different example but the same effect, shock to get them to the table, and it works, or if it works, what are your thoughts about diplomacy going forward? >> well, since i was a diplomat for most of my life, i think summit deals, summit agreements ought to be carefully prepared, it's a good idea pompeo went there to have a preliminary meeting in secret with kim jong-un. whatever we do in korea

immediately engages the interests of our allies in the region. south korea, japan and, of course, china. so it's a multifaceted thing which doesn't lend itself to winging it. it has to be carefully prepared, the summit. neil: a lot said of the president saying if i feel the talks are going nowhere, unproductive, i'll up and leave the table. what do you make of that? >> again, this is his style and i think part of the problem for other countries is not knowing where the line stops. what is it that is said publicly that is real and face-to-face. a summit meeting that fails with a potential adversary is a very serious problem because there's no access. no other thing can you do once you've made it the summit level, you can't go higher than that. it has to be carefully prepared. that's the bottom line. neil: ambassador paul bremer, good seeing you, thanks for taking the time. >> nice to be with you, neil. neil: apple ceo meeting with

the president of the united states, tim cook. he was at the french president dinner last night. today he's make the push on trade. he asked for this meeting, the president granted it. he and the president, not necessarily a french bro-mance type of relationship, they have struck up a camaraderie on key issues like easing up on regulations and certainly on taxes. that has certainly benefitted apple. so whether he's getting the president to soften his approach on the chinese, no way of knowing. we're on it. after this. when it might be time 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. . .

neil: oh to be a fly on the wall with tim cook and president meeting. say you are the fly. do you understand what is going on? we don't know what kind of concessions president might make on china tim cook wants to see but i bet you trish regan will know very soon. i hey, trish. trish: i like the philosophical question. neil: i have no idea. trish: thanks, neil. apple ceo tim cook is sitting down with the president at this very moment. he is trying to convince our president to go easy on china. he obviously has his reasons doing that but are they in the interests of this country? i'm trish regan. welcome to "the intelligence report." the head of the world's most valuable company heading from silicon valley on trade tensions between u.s. and china. what he is trying to accomplish? does he