>> great interview with mcghee but -- saying that right? >> really something guy does business in north korea saying that that's a closed economy. wow. [laughter] >> thank you for uncovering corruption. month after month after month within the government. maria. >> that will do it for us dagen has you covered tomorrow. have a great weekend. stuart over to you. >> good morning maria and good morning everyone. we have a lot of news. a lot of is negative but not that big a reaction on the market at least not yet. start with with tariffs on imported cars the proposal is bump them up to 25% from the current 2.5%. this is aimed squarely at the nafta negotiations president trump is not happy with the way things are going. mow we bring in a lot of cars from mexico. a north korean official cast more doubt on the june 12th summit. the president told fox and friends this morning, with we'll see what happens.

separately, the north korean today claim they have blown up their nuclear test site. iran, a warning from the itola to europe commands the europeans buy all of iran's oil that they counterrer any new american sanctions that they must not raise the missile issue or iran's behavior towards its neighbors tough stuff not exactly a positive news background. but there's no serious selling thus far on the market. half hour from now, the dow will be down roughly what -- 50 points there you have it. what's what's everybody talking about today? i'll tell you possible and an they will protests, the nfl is trying a compromise. player stand or for the anthem on the field they can kneel if they like in the locker room nobody is happy. stand by watch out, "varney & company" is about to begin.

>> i noticed recently where democrats, naption, has an example by trying to defend ms13 gang members. i call them animals the other day, and i was let with rebuke. they said they're people -- these are animals. >> there you have it. the president doubling down i think actually he's quad droop ling down on animal comment sage from the very epicenter of ms-13 gang angt that would be long island, new york. joining us now the acting i.c.e. director, thomas it's an honor to have you on the show sir. >> now the president is demanding tougher immigration laws. are we close to it a deal? in your judgment -- >> we set a series of policy changes and loophole fix ifs up to the hill. i'm hopeing they're working on it and hoping to give changes but if we don't close loopholes

to change laws rain shower not going to solve the early immigration crisis. >> it e seems to me that the president is winning on the ms-13 issue but winning in the sense that deportation of gang members have doubled in the past year. and the murder rate are on long island has come way down because of deportation would you call it a win? >> i would say we're winning. we're attacking we'll continue to fight until we totally mantle this organization. these are people who are -- not just killing young kids. they're torturing them. so when you have parents i met yesterday who have to live every day their child was not killed their child was tortured, machete what a horrific, horrific death these parents have to live weaver day. so -- we've got all hands on deck. we have a president that's got our significant impact since this president has been in office. so we're going to continue this right until they're destroyed. >> i want to show our viewers

something when we've had on the air for last couple of days that is that trail or i'm sure you've seen. sure you've heard about it it was found 50 miles north of the border and about 92 illegals suffering from dehydration pretty bad situation. why is that kind of thing still happening? >> there's a loophole when you talk about many times sanctuary cities that entices people think can buy late laws in this country and get to a city where they think sanctuary from law enforcement. from i.c.e. -- that is one of many enticements in this country work to get a job and i.c.e. stepped up enforcement and trying to take that away. that's why we need congress to address this issue. last year under this president we have a 45-year low in illegal crossings. that's not a coincidence that's because this president, president trump has allowed us to do job and american patriots worked for border patrol. and what happened yesterday is terrible and that's for the

people who want to fight the president on immigration this is stopped by law enforcement. this is not the president trying to -- or, you know, hold law to a higher starpgd this is about saving lives. as long as we have loopholes and magnets people are gong it die enter this country. the 86 was terrible. i was actually sent to headquarters to crime scene years ago and vowntded by 19 dead aliens laying arpgd me. think about that with a five-year-old little boy to suffocate in father's arms that day and haunts me to this day so this isn't jus about law enforcement but saving lives we gather that this president address this issue. congress needs to get to the table and fix this so -- it's not just about again, not just about national security and law enforcement. but it's about saving lives. >> before you go i want to raise the issue of a republican name is steve king he introduced what is called what he calls the living act under which sanctuary cities get up to five years for tipping off illegals to an

i.c.e. raid. do you think that helped your cause? >> i think anything we can do to protect men and women of i.c.e. -- people that leave and strap a gun to defend their nation and anything that protects them sing a good thing. what nay your did -- i'm the not getting into policy what she did it was wrong. we have a thousand targets in that operation. a vast majority of criminal public safety threats, and to give a warning to criminals that the police are coming it undermines everything we do and puts officers at risk. i have 51 names on national law enforcement morning laws in washington, d.c. i don't 52 names because someone tipped off a criminal that good guys are coming. >> well said tom you can come home any day you like. thank you very much indeed let's turn to money now. here's how we're going to open this market a few minutes from now 24 minutes we're going to be down across the board but not by that much. couple of individual stocks company making news and going

places look at that that is william -- they're up 11% that's a whopping great big gain . >> a 30 dollar -- there cut down, and a so i am corrected it is 40 dollars. dichght story, though, totally different at victoria's secret, the parent company is l brands, weak forecast for the future. you do that your stock goes down nearly 6% in the case of l brands now best buy another hit there. their growth their ongoing growth is slowing down it and that's overshadowed strong earnings the stock is down nearly 6% . stull on your money -- look at 61,483. come on in dan with pal said capital management. say that the good news on the economy is only just beginning.

there's more and better stuff to come. make your case. >> stuart just since the financial crisis, we were in a long period of financial repression where we had qan at a quantity at a to meant to prior declines in the economy but we're coming out of that period now and we never really had the four, 5, 6.growth period that you would expect to see after a recession ends particularly of the magnitude we have in the financial crisis. i would argue that really we just gone sideways for -- six or 7 years seven or eight years and it was really the domestic energy boom that sort of mafnged a lot of true route in the economy. >> are you suggesting that we're going to get to 4, 5, 6.growth at least in the couple of quarters? >> definitely have a couple of quarter requests spikes that will be -- >> 4 or 5%. but it should average out north of three -- and a half percent those are

achievement targets. >> okay now that's the economic view transfer that to the stock market view. if you get that kind of growth, does that trance late into growing profits and a stock market higher than where it is now? >> i can't -- overstate the impact of tax reform 100% bonus appreciation of capital commitment into investment you're finally starting to see an investment cycle occur. that's why we're starting to see the smaller cap names start to outperform the s&p 500. you're seeing a broadening out of the equity market and a lot of it is being led by -- the financials. stuart: i sense in you reluctance to go out on a limb to say we get a stronger economy and a sharply higher stock market. will you say that? >> stuart we're going to get a sharply strong or economy and a -- i believe a rising economy. a rising stock market. we have there are periodic

periods where evaluation get higher and lower i think that's makes case for active management versus passive management that works so successfully the average may not tell the entire story you have to listen to individual stock. >> got it dan thank you so much for joining us. >> all right. where do we open same story as it was five minutes ago. i'm sorry down about 50 points. got it. same with s&p nasdaq down slightly. elon musk wow, a tweet storm and ranting about the media even floating idea of starting website to let the public rate journalists. here's my question is this how the ceo of a publicly traded company should be acting it's a good question. we will have the answer i'll promise you. ruling president trump cannot block his krit frix viewing and comment on his twitter feeds it's a first amendment issue. what will napolitano have to say about that as in the judge he's

on the show. north korea backing out of the meeting with trump calling vice president pence a political dumbny could the big summit be "jeopardy!" monica crowley is on that. and she is next. [fbi agent] you're a brave man, mr. stevens. your testimony will save lives.

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>> north korea says it is blown up that nuclear test site. did it today. but this morning, first thing this morning, they threatened to back away from the june summit and call vice president pence a political dumbny. joins us snow monica crowley with london center for policy research. monica, i'm inclined to ask is this theatric. >> does seem leer that he read the art of the deal and knows thousand strategize and how to negotiate and that includes threatening to pull the rug out from these entire negotiations. i think that the stakes are so high that we're so far down this road publicly already that i think the summit will go through

whether it happens on 12th or weeks after that. that is the question but i believe the summit has too much to discuss and kim jong-un has already made a serious confession. >> i think that president trump will be there -- even if kim jong-un is not there and i think he will be there and i think i don't think he's -- be president trump will back out. but kim jong-un if anybody. >> and wouldn't that be very interesting object. president of the united states arrives in singapore prepared to deal on korea. on denuclearizing korean peninsula ready to have that conversation and dictator does not show up and plenty of other issues the president ask can discuss with allies if kim does not attend. >> i want to move on a subject what you follow closely in which the president tweeted about this morning. the new read tweets for you. first of all not surprisingly, the great men and women of the fbi are starting to speak out

against comey mccabe and all a of the political corruption and poor leadership found within top ranks of the fbi comey was a corrupt leader inflicted great pain on the fbi. spy gate he's implying there are fbi people willing to come forward and be critical of combmy. you have more about this? >> we've heard mow for a very long time that rank and file and fbi are horrified by what leadership of fbi did in turning so political at the highest -- there is an fbi agent named joe -- who interviewed general flynn as part of this whole process. he is horrified and yesterday he made a statement saying that he's prepared to testify against both james comey and andrew mccabe and his, quote, was it was all combmy meaning that all so much of this was directed straight from the top. if he has one of -- even if he testifies alone but one with of several who is willing to go on the record

under oath, and talk about what the leadership organizeed or what they directed the rest of the agency to do, we are in for a real crisis. >> the real crisis comes if we find that the spy or the informer inside the trump campaign was feeding back political items to that person's masters. namely america' law enforcement operation a political plant of a spy that's bigger than water gate. >> and i have a column that's going to be published today at the hill that discusses potential -- the potential will not be just of the fbi and d.o.j. what we've been talking about and to be clear this was the obama doj and fbi. while the focus has been there, i think that it will include the cia and my column that's coming out later today at the hill talks about what role if any the cia director of john brennan had to play in all of this.

>> well he's been extremely aggressive in criticizing president trump, i mean, i see -- coming on statement which is are outrageous about the president. smg that's because walls are losing in on all of these top obama lieutenants. and that's why you get their pre-emptive strikes combmy memoir and hillary excuses and this is all meant to put off the inevitable they never expected trump to win. they thought all of these afnghts would be lost to history forever because hillary are would be president. now it is all being exposed they are threatened and they are pan ibicked. i want an advance copy of your article in the hill. thank you very much. monica thank you ma'am. see you later again check weather markets. same story as it was minutes ago down between 50 and 60 points now look at this brand new video right out of the hawaii volcano zone. will you look at that in see blue flames shooting out of the

foreground of the shop there. that's dramatic indeed. we'll explain the science behind blue flames in just a moment. that's next. i got scar tissue there.

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year treasury. 311 late last week way below 3% this thursday morning. let's get to the -- the visual shall we? this is television. hawaii -- see blue flames dramatic video what's with the blue flames? >> join zip owe lighter that is caused by lava rolling down the volcano underneath the ground. and rolling over trees and plant life. as it does that, it burns up those trees and plant life and creates the methane gas. and that blue light is created by the methane gases glowing and you can see it at night especially the fear, though, is lava rolls through it's taig out a lot of trees and a lot of plant life, and that gas could build up underground and ultimately create a much larger explosion. because it is very volatile you have the gas and you have the heat and -- so they keep an eye on that but it is one problem after another with these -- with the volcano because you have the lay which is is lava haze with tiny shards of glass

in is so you don't want to be breathing that in so again this all began on may third and shows no sign of slowing down. look at that mesmerizing it can go on for a long time that's for sure. totally different subject let's update we have an update actually on the fatal über crash -- in arizona, the self-driving car that was involved did not break before impact. what else happened? >> so that's an indication that the driver was distracted looking at her phone we seen on the video this is the -- testing of the über robot cars in arizona which are über and here's the other part of it. that car, that robot car only recognized the lane since passed away because of the accident as an object only 6 seconds before the crash. thats that that cores are not up to speed to identify people walking across the path of robot car über has suspended that

testing in arizona and for that fatality. that's a negative of pr negative for über. but the other side of the coin, haven't they just reported a big increase in revenue coming in -- they're taking more people on more rides. >> 70% increase in revenue. 70% year over year and that's better than facebook 45% prop in the quarter before it went public six yearsing ago so iewber is cooling in strong with earnings. financially sound bad p not bad okay well if they do ipo florida strength will be more important i subject by the fbi i think. check the -- futures again, let's see where we're going to open four and a half minute hads time down about 50 points but i see nasdaq now eking out a very small gain, we'll be watching those tech stocks for you and that's a promise. we'll be right back with this after the wall street opening. ♪

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taking jardiance with a sulfonylurea or insulin may cause low blood sugar. tell your doctor about all the medicines you take and if you have any medical conditions. man: ask your doctor about jardiance and get to the heart of what matters. >> all right thursday morning, we're about to open proceedings on wall street at about 30 seconds that is. one important point is a back drop it here, is what i'm going to call a fairly sharp decline in interest rates this like last week we're talking ab yield on ten year treasury a 3.11% today we're looking at below 3%. i would have is thought that was

a plus for the market we shall see when opening bell sowpgdz. we closed yesterday with a 52 point gain, and we closed at 24 800 we're expecting a drop of about 50 points this morning. when we open up, and bang we're opening up right now. where are we going? that's yesterday -- this is today. we're down 23 we're down 27 -- they all open up get a better read are now down 37 point that is not a sharp decline. it is a fraction of one percent only. all right now we're down 40 -- that's not a big decline by any means. what's going on with the s&p? a broader indicator is that on the downside too yes it is but about same percentage as dow .9%. a marginal decline. how about the nasdaq now has that turned higher no it is not. down a tiny fraction down 1.0%. okay the current yield on tenure it treasury is 2 98% fed minutes

show the fed is less likely to be aggressive about raising rates down we go 298 ceo and elon musk -- musk aired his frustration with the yeedz on wednesday we'll have more on that in a moment, the stock is down this morning 237 kroger or there's -- they did it in the news recently they're taking a shot at blue apron. they kroag or getting into meal kits and meal kit delivery. william sonoma retail bright spot sp day look at the future and like what they see up 9.5%. microsoft 100 dollars share yet -- not quite. but we will -- i will take 98, with 75 that isn't all confetti. no retirement -- and -- [laughter] what is up and that's an all time record high for microsoft. who is with us ill tell you right now, elizabeth macdonald

elizabeth, i'm sorry -- elizabeth ashley webster, john leifield is over there in bermuda a beach in the background and john, and david dietz is right next to me. i want to start with tesla. it's one of the most exciting interesting companyies around. their chief elon musk very critical in a series of tweets overnight and then this morning. he's heavily criticizing the yeedz. now the stock overall down about 100 dollars from its high. that means a 28% drop in the last eight months and it is down a little bit more this morning. i start with you john i know you've never been a fan of tesla but when chief goes on a rant like this i think that's bad news for the stock is and company, isn't it? >> i agree and i'm not a fan of the tesla evaluation but fan of elon musk doing welfare things for our country in the united states. it is great that we have him and hope he stays and doesn't go bankrupt but find a way out of this. rise are in social media has -- given a voice to a lot of idiots

out there and some of these idiots claim to be media. i don't blame elon musk for doing this i think success is best revenge you figure out a way to get this model three production going that's your best business and haters out there. i don't blame him i wish he wouldn't do it. >> okay it seems to me lizzy that he's exhausted. i mean listen to this first line of the tweet last night, the holier of big media companies who lay claim to truth but publish only muff to sugar coat lies. >> literally physically -- he is physically at that fremont factory that faces the fight, he's in the fight of his life right now. and so what elon musk is doing is saying listen, your mystery porting this with with the reason for these crashes of our cars. that's his problem he doesn't like reporting how it is being done. >> silence media krit arics to deliver on what you're promising at this point of impact you have to do to do it. >> wait with a second should -- the head of a publicly trade

major corporation saying this kind of thing in public? >> i don't think so. the focus is three things one is production increase and production of the tesla three. cash flow, figure out how you finance all of this and finally safety american potential public is worried about safety. >> mufng has a valid point when you deal with self-driving car and drives sitting behind it does not relieve you of control of that car. it has one hand on the wheel although dracting panel inside for gauges he's saying, report it correctly that's what he's saying. >> got it. stuart: president trump is calling for tariffs on all imported cars. trucks, autoparts too. what is this a -- proposal proposal for a 25% tariff on everything. every vehicle that comes in. >> a big stick in the nafta talk the president is saying we want u.s. jobs here for the autoindustry. they're saying this is a national security issue. that our -- industry basis has been gutted

by what's going on in car industry, however, people are saying listen. this is going to hurt u.s. consumers and rate hikes for everybody. tariff -- >> look at that toyota is down diamond is down, bmw and read german had and -- bmw look at ge please -- it took a hit yesterday after comments from the new chief mr. flannery the majority didn't take timely to comments and down to 15 a share. are you still a bull on this onesome >> stock entered bullish tear tire after rising from 12. i don't think that selloff yesterday was justified. he refused to -- make an ironclad guarantee behind a dividend that's not the job but the board job so prudent positionings o.c. there's no great big news but, of course, they have a nice deal with tech. so i think people are expecting too much too quickly it is a big shift give it time. >> bought it at 12 and happy with it at 14. >> i am the not selling yet.

look at netflix it just hit an all time high right now it is at 343. it was a little bit higher than that but you get the point the thing is right up there with a market value now, bigger than -- comcast john coming in from bermuda please too expensive at 343 for a guy like you to it buy. >> absolutely look netflix is a pioneer about what would recommend to you to want to watch and incredible what they've done with the soft wear and one of the reason ares for success of netflix but i worry about amazon and apple getting into this and offer more than a subscription to video services i wore about evaluation a great company but i worry about evaluation. >> tripled the gm and approaching disney meanwhile it is swamp book value manufacture in the offbalance sheet. yes, but they have a huge global untapped audience still to go at. >> that is potential growth. >> let's hope and dream an change with subject i would say.

>> okay lizzy walk away from that one. where are we now on dow industrials we're up exactly as we expected to be down about 40 points. how about the price of oil. what kind of threats coming in for the -- sorry it's down. down a dollar a barrel back to 70 how about that? but gas prices keep on rising. now we're at 2.96 national average and there are 16 states plus d.c., in the $3 club that's where average is more than $3 per regular in those states. all right, cisco's cyberintelligence unit. didn't know they have one but they do. it says is it discovered at least a half a million devices and at least 54 countries they're infected with type of malware previously used to attack the ukraine. okay. i mean i don't know where you go with this because we're one leak and one hack after another like embedded -- it is a huge one. all right, hormel makes skippy

natural choice and yes spam. of which i grew on spam. americans exported it to europe after the second world war and fed to us kids. look at me now. [laughter] >> that explains it. victoria -- secret they've got a parent company called l brands. they gave a weak forecast doesn't matter in this case. the stock sup near 4%. kroger taking a pay from blue apron getting into meal kids who are they buying? >> they are buying a -- just a second i know i was going to get this -- [laughter] with the the company -- no -- home -- thank you this is a thank you for forgive me i just had a little issue there. this is a third biggest to 200 million for kroger taking on amazon, and the home and blue apron. i'm not -- i by this trend at a box at home

my meal kit is a box of spaghetti. this is a big thing for people. >> very hard to prepare and it is very hard to make any profits on them very hard to keep customers going month after month after month they drop out quickly. >> is there a trend it reflects the fact that kroger is under siege amazon is now controlling whole foods smashing prices tieing it in and wal-mart and kroager is doing everything possible to fights back. >> it is down today 15 cents lower 24. watch out -- watch out angies list. facebook marketplace, is expanding into home services. so i guess this means i can get on facebook and if i want to plumber or electrician i go to one website here he comes. >> that's but i wouldn't be worried about about ancillary home service companies because basically facebook is bringing in their listings and they're not paying for it they're not earning any money on it and, of course, remember the best listing is one that a trusted

neighbor or friend gives you to have that on their post. >> okay looks to me that facebook is stock is. last word to you please john give me the big picture. he's not there. we lost the feed okay -- back -- such as life ladies and gentlemen. we're still in new york. and david thank you very much indeed, sir. thank you, you too. again we've come back from our low of the morning it wasn't very low down about 50. now we're down 27 not much movement thus far on a thursday morning. check change is coming to facebook's privacy settings they're making it easier for you to choose which personal details you you want share with the rest of the world we'll try to explain it to you and nfl laying the a policy for anthem protests if you're on parking lot field you stand. if you want to kneel stay in the locker room. man pan know on football how about that -- will a judge on football. next. ♪ nah. not gonna happen.

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we're down 26 on the moment now facebook they are making changes to their privacy controls. deirdre knows all about it. >> they're going to sending you facebook will sepgd you so many questions stuart you're going to be sick of answering them they're going to send you questions every time you share something or post something. they're going to do you want to share this and you're going to have right to say yes or no. so i can tell by your face you think this is annoying that they have to do it. because if they don't, it is going to cost the company 1.6 billion per year 4% of their annual revenue because they need to be in compliance with european laws which start tomorrow. so going to get fined.

so europeans impose these new rules a of midnight tonight and if facebook doesn't comply with all of these questions -- that i've got to answer, okay. how many questions? >> opt out it is going to be when you post something that they deem by their algorithm to be potentially sensitive so that would include politics. wait for it stuart and religion those are two big categories. >> anything you think. always contentious. yes. so politics or religion you're going to be asked a question. >> i want to share -- >> are you everyone on facebook? >> no. [laughter] stuart: thank you. no that was a very clear report that's exactly what i want -- >> perfect answer to the question but they have to pay you to do it. awe -- [laughter] have i been introduced? stuart: i'll introduce you. a district court judge has ruled that it is unconstitutional for president trump to block people from his twitter account.

well, judge napolitano you're our regular constitutional scholar is the judge right? >> nip, yes. because he's the president of the united states and because he has said unequivocally what he says his on twitter sorry i forgot to turn off. twitter feed what he says on his twitter feed is official government announcements he has made that a public forum and because it's a public forum he can't exclude somebody from it because of their political views. he could exclude them if they were disruptive if they tried to impede his ability to communicate but can't exclude because they disagree with his politics first amendment what is unique is president to the defendant, and this has first time this has been addressed by a federal court. >> if you are dictating policy and communicating to country via twitter, it is wrong to cut anybody out. >> correct. that would be -- not apply to you or to me

because we're not in the government. we're not the president. so if i had a twitter feed i could block you and you're -- you would -- [laughter] i want to talk about the constitutionality that got of the case. >> democrat senator of new jersey he's got something to say about this. roll it please. >> seems like the nfl is really undermining the very values that they profess to be protecting or stand for something. there are soldiers who died for ideals of that flag of the constitutional expands for. will you hold on for one second because i have breaking news and i want to brig it to everybody. the summit to north korea, united states summit is off. >> written from the president to kim jong-un basically saying, based on the tremendous anger and open hostility gleyed in your most recent statement i

feel it is inappropriate to have this long planned meeting so e therefore let this serve that the summit for the good of both parties is off. but this is to the detriment of the world that is not taking place. you talk about your nuclear capables but hours or so massive and powerful that i pray to god that that will never have to be used it goes on and on but basically -- it is off. >> it is our president, with president trump -- who has written this letter he is pulling out of the summit. >> he is. a wonderful dialogue was building up between you and me but ultimately it is only that dialogue that matters some day i look very much to meeting you in the meantime i do want to thank you for release of hostages now home with their families that was a beautiful gesture and was very much appreciated. >> now i should tell you as soon as this news broke 90 seconds ago we have the dow drop about 89 point we have come back now we're down 70 points. which implies to me that the summit was not a big mover of the stock market in the first

place. because if you're only down 77 where wh summit is called off just like that -- and m plies it is not a big deal. >> an important point because secretary of state mr. pompeo has been warning for days now that the fate of this summit rest with kim jong-un, and after the vice president had that sit down interview with martha, they went full bore with attacking the vice president calling hem stupid, ignorant, and so -- this does not sit well with u.s. negotiators on this side of the aisle when it comes to that summit. >> did the president in his letter refer to the -- extraordinary hostility from the north koreans, i mean, they did call vice president -- >> no. a political dummy and based on your rhetoric and your tremendous anger and open hostility does not mean that vice president in particular he says at the very end look if you change your mind, please do not hesitate to call or write me. i just look at this a missed opportunity that is truly a sad moment in history. >> okay we have scrambled blake

at the white house has to tell us what else do you know on this one, please, blake? >> i was speaking with the couple of my colleagues here earlier today and we were talking about whether or not we should contact the vice presidents office to see if they have any sort of statement. any sort of reaction to the north korean who had called one of the top officials -- the vice president a political dumbny which you guys were just talking about. i didn't e-mail them because we figured there would be no reaction from the level of the vice president's office afl this is held at such a high level discussion at this point. we thought they might leave this up to the president or -- to the maybe you know to the press secretary to kind of get out ahead of it. >> very clearly left it up to the president because you just saw the letter that donald trump the president had put out in which he essentially says the rhetoric that you have used to against the vice president is -- either the reason or one of the reasons that this is not happening going forward. remember north koreans pointed i thinker initially at a john

bolton for his comments in which he said that -- the libya model would be a model to get north korea to denuclearize. you know what happened to moammar gad fear after nuclear weapons were taken out of that country you know how that story enldzed the north koreans did nots likehat comment at all mike pence the vice president was commenting about that and in his interview with martha and then they took their anger from john bolton over to -- mike pence and now -- that is appeared to at least the goen to a level to where the president has said, enough is enough. this summit is off. we can tell you there have been plans stuart -- for top administration officials administration officials told fox or for top administration officials to head to singapore this weekend to plan out logistics to plan out the agenda. so this appears to be a very sudden reversal from the upper of this administration to now pull out the letter from president trump. it is a message his message rather over the last few days

had gone from bearish to bullish but the bottom line from the president through all of this is -- or was we will see what happens. at least for now, stuart. what is happening is -- no summit this is called off from president trump in a letter today pmg >> blake thanks very much indeed and more from you in a moment i want to update the markets because -- as soon as the news was announced we went down 89 and came become a bit so we were down 70 now we're on the downside all over again lost 150 points. 24737. president warned there was a substantial changes that this summit would not happen. meaning it would be delayed this will likely affect the china trade talks as well. the president this recent days has warned china keep your borders tight. because he's saying that the president is saying that people are rying to get out of north korea into china right now. >> so we've got a tough line from president trump this morning he did by the way in that letter say the opportunity for lasting peace has been lost.

>> what's interesting north korea blew out some of the tunnels they say it was using for nuclear missile testing and then we get this right after that. very interesting development. >> i wonder if judge comment to this please is this the president style take a very tough line negotiate -- see what happens. if you have to do it you do it. i only heard parts of the letter that ashley read for us. this is a great letter this shows leadership. this shows taking control of the situation. for once his impatience with that caused him to say enough it is enough and not kicking it off forever but i'm saying you want to come back. come back i wanted to it meet you you wanted to meet me time is not right now i'm making a decision. hat is off to the president for doing this and manner in which he did. north koreans picked up on comments by john bolton who said that getting rid of the nuke you follow the libyan model well libya -- muammar gaddafi ended up being

shot. >> we know john and you know who corrected him the president himself a few hours later so we're not talking about the libyan model but damage has been done. stuart: and then vice president mike pence in the interview with martha, he made somewhat similar comments and they come back and said he's a political dummy. now this. >> it was too personal with the vice president no reason for that. whether they believe it or not but from our point of view is no basis for it. probably got under everybody's skin. but the president aingt going to take their rhetoric not that kind of -- >> not going to take the rhetoric or the bait. >> the bait would be what? >> challenging them or attacking them personally as they attack the vice president. this letter is a diplomat pick letter of a command decision of a person monos where he wanting to. gliewt he did afterall thanking femme for releasing three hostages that is -- we used to trump tweet. >> used to more -- >> this was fairly mild. ash if you still got it in front

of you could you read the first paragraph again please ?rchtion we greatly of dr. mr. chairman we appreciate your time, parks, effort with respect to recent discussions and relative to summit long sought scheduled to take place on june 12th in singapore. we were informed that the meeting was requested by north korea, but fact to us is totally irrelevant i was very much is looking forward to being there with you based on your tremendous anger and open hostility displayed in your most recent statement i feel it is inappropriate at this time to have this long planned meeting. defense docks all of them, on the upside and they just moved higher. those words were measured tempered, professionally crafted -- a little untrump but i'm very happy at them. [laughter] >> i think liz's point should be taken very, very seriously taken to heart. because -- the north korea united states summit is another party involved and that is china.

>> here's why. this is 3d -- so what this is, remember china was thought to have urged kim jong-un to stand strong. be strong. now, with this off the table china -- doesn't have that pressure on it to deal with in the trade talks you remove north korea china is more liberty to get the deal deal it wants and delay the deal making in the trade talks with the u.s. >> i have to say that the market is not taken it -- as really huge negative by any means. i mean a lot -- to the judges point, excuse me, and you don't know what will come next we have no response yet from north korea don't know what they'll say. i felt a wonderful dialogue was building up between you and me and ultimately only that die it log that matters look at this now down half a percentage point. when you get -- really moment us news like this the summit, the much anticipated big summit takes place june 12th in singapore and it's gone.

>> i think that the reality is that i think that people know, north korea's economy is size much togo half the size of vermont and military is starving. china is keeping it on a short leash. that's why you don't save that much of a dramatic selloff in dow right now. >> but they have niewxes we have jordan change on phone line for us now. jordan a summit on june 12th your reading that have please. >> i think it's a goods thing for president trump to have done this. i actually would have had president trump say to north korea publicly is this summit on or is it off yes or no? and let the north korean make the decision. but nonetheless, walking away from this summit now sends a message both to the north koreans and to the chinese that they cannot play the united states. and so this is a good move on our part i hope that it leads to the chinese putting much more pressure on north korea. but if they don't stuart, united states needs to put pressure on china. because china is the author of

north korea's mischief in last two or three day. >> would you agree with this? president trump has taken a hardline but wrapped it up in very diplomatic language? >> yes. that's a good way to do it. >> so -- now what? the summit is off although who knows when if the north koreans will come back with something or other. i don't know that at this point because -- summit is only just being called off but what would you say is the the next step -- we need to choke off our commerce to north korea to very well involve the u.s. navy making sure that there's no sea born traffic in or out of north korea second thing is to go after the chinese banks. four of the large e.g. chinese banks so-called big four are have all been money landering for north korea this is apart from what our policy choices are we need to enforce our rules and regulations. this case we especially need to

do it because -- china has pushed north korea into this very difficult position. >> jordan we've had a hold on all forms of military action for at least the last two months, i believe. now you're suggesting that maybe our navy will have to blockade north korea that would be a military move. that is a form of military escalation isn't it? >> well, it is. but it's also an enforcement of u.s. sanction. you know, u.n. sanctions. we have is had the u.n. impose these rules but not enforce them and it's time for the . because we have the authority, stuart. the north koreans have abrogated the korean war armistice so many different times that gives us the right to use force f we have the right to use force, we certainly have the right to stop ships, inspect them especially for contraband. stuart: i'm going back to blake

burman at white house who has new information for us. reporter: stuart, i got a note from white house official, i will read it to you. people are focusing too much on the dummy comments. the north koreans literally threatened war in the statement. no summit could be successful under these circumstances. north korea literally threatening the american people t was wise of the president to walk away for the time-being. remember the u.s. conceded nothing to the north koreans. we walk away, having given super row. that from a white house official. an early read on this. stuart: i want to repeat that, blake, because that is very important stuff. the north koreans, according to the white house, threatened war, threatened the american people, and that's why we ended this summit, that's accurate? reporter: according to this one person. liz had talked about being 3 d chess. there are a whole lot of facets to it. very clearly comments made by

about the vice president last night irked this president. he also said, look past that because there are bigger and broader issues between calling a politician a political dummy. liz: that is the point that blake brought up, this is the threat to north korea from us last night, from north korean's minister of the whether the u.s. will meet us in meeting room or counter us nuclear to nuclear showdown is entirely dependent on the behavior of the u.s. they did threaten war. stuart: indirect threat,s that for sure. ashley: washington to taste, quote, appalling tragedy. strong language. stuart: 10:00 eastern time. let me wrap up exactly what has just been happening. literally 20 minutes ago we received word that the june 12th summit in singapore between president trump and kim jong-un is off. it's off because our president says it's off. he sent a rather diplomatic,

very diplomatic letter to the north koreans saying look, we can't continue like this. the rhetoric that you have been use something unacceptable. thanks for giving us back the hostages but that summit is off. the immediate reaction on the stock market was, a modest, i repeat a modest selloff. when news of this kind breaks, the dow drop as mere half a percentage point, you can pretty much say that the market is not saying this is a dramatic event or it has a dramatic effect on your money or the price of stocks. we're down 150 points. that is roughly .6%. not an enormous selloff. we just got word from blake burman. he has been talking to his sources inside of the white house with a little more explanation why the president called off the summit. blake burman told us that the north koreans had indirectly, liz, back this up, indirectly threatened war and threatened the american people. unacceptable. the summit is off.

right now we're down 148 points on the dow industrials. i want to return to this, i think it was a diplomatic statement from the president. we read this several times. ashley: it was very well-written, to the judge's point, very pointed. just lays it out very carefully. basically says this, based on what we're hearing coming from you and dialogue and hopes tilt we believe it is inappropriate to meet at this time. if you write or call me, mr. kim, by all means please do. stuart: gordon chang is on our phone line that is. gordon, i want to repeat when i asked you, what do you think comes next? you suggested we start blockading north korea in line with u.n. sanctions. repeat that, please, because i would find that provocative, to to -- go. >> the united states needs to make sure money is not getting into north korea. we should use everything we can, short of the use of force at this point to actually get

north korea back to the bargaining table, get back to the point where it says it will give up its most destructive weapons. that means we need to make sure that ships are not violating u.n. sanctions. we have the authority to do this because the north koreans have abrogated the korean war armistice number of times, most recently september 25th last year, about three times before that as well. the other thing we need to do, stuart, we need to start sanctioning the chinese banks. beijing has, i think, as president trump said tuesday to moon jae-in, the south korean president, president trump mentioned that the chinese had put the north koreans up to this. so what we need to do at this particular time is punish the chinese because their actions have caused these problems. stuart: okay, gordon. so it will spill over into the china trade negotiations. ford done chang, thank you very much indeed. gordon chang.

bring in jason chaffetz, former republican congressman from utah. seems to me, jason, our president is taking a tough stand, bang, this summit is off. what say you? >> you're willingness to walk away from the table gives you strength in these negotiations. the planned meeting is still some 19 days. it can easily come back online but if the president is showing a willness to walk away, i think that puts pressure on north korea. i do agree so much is intertwined with china. if you look at trade north korea has, we put maximum pressure on but so much of the trade with north korea is actually with china so they become an integral part of this. i put my cards on mike pompeo and his personal relationship with kim jong-un. i think there is a strong possibility it might happen, but i think the president's willingness to walk away is a good thing for the united states. stuart: mike pompeo, secretary of state, has just walked into a building on capitol hill.

you can see, there he is. he is about to give testimony before i think it's a senate committee if i'm not mistaken and i'm sure he will be asked questions about this as soon as he begins to speak. if he has got something to say, i think he will, you will hear it directly. back to you, jason chaffetz. it seems like this is going to spill over into the china trade talks because china is the key factor, north korea is a chinese client state. this ending of the summit will surely spread to china trade and the negotiations. is this a negative for the china trade talks? >> no. i think it is ratcheting up the strong negotiation. i don't think it is any accident roughly 30 minutes before mike pompeo is going to testify before the united states senate that this statement comes out from the white house. i think that is timed. i think that is coordinated and i think it is a strong way for the administration to get its

word out and put pressure on north korea, also on china. stuart: sorry to interrupt you. mike pompeo is about to read that letter. i want to hear him say it. go. >> north korea, the letter is to chairman kim jong-un, chairman of the state affairs commission of the democratic peoples republic of korea, and it read as follows, dear mr. chairman, we greatly appreciate your time, patience and effort with respect to our recent negotiations and discussions relative to a summit long-sought by both parties which was scheduled to take place on june 12th in singapore. we were informed that the meeting was requested by north korea but that to us is totally irrelevant. i was very much looking forward to being there with you. sadly, based on the tremendous anger and hopes tilt displayed in your most recent statement i feel it is appropriate at this time to have this long-planned meeting, inappropriate. i feel it is inappropriate at this time to have this

long-planned meeting. therefore, please let this letter serve to represent the that singapore summit for the good of both parties to the detriment of the world will not take place. you talk about your nuclear capabilities but ours are so massive and powerful i pray to god they will never have to be used. i felt that a wonderful dialogue was building up between you and me. ultimately is only that dialogue that matters. some day i look very much forward to meeting you. in the meantime i want to thank you for the release of the hostages who are now home with their families. that was a beautiful gesture and was very much appreciated. if you change your mind having to do with this important summit, please do not hesitate to call me or write. the world and north korea in particular has lost a great opportunity for lasting peace and great prosperity and wealth. this missed opportunity is a truly sad moment in history. sincerely yours, donald j. trump, president of the united states of america. thank you, mr. chairman.

>> thank you, sir. we want to thank you for joining us today and although you're here for a confirmation, you were here just six week ago -- stuart: we have, we still have jason chaffetz with us, i believe. jason, you just heard the letter formally read by our secretary of state. it sounded diplomatic to me even though it was a very hard-line the president was taking. it seemed like a hard-line wrapped up in soft diplomatic language. what say you? >> it was, it was very diplomatic, short, sweet to the point. nothing to confuse there. very complimentary of kim jong-un and the release of the hostages. the president's willingness to get together but he has got to, you know, have the rhetoric toned down from north korea, just not helpful to having a serious negotiation on the world stage. stuart: in your judgment is this it, it's gone, it's finished forever, there will not be ever a u.s.-north korea summit?

>> no, that is not what the president wrote to kim jong-un. he said that he wanted to actually meet with him. i would still venture to say even though we're less than three weeks out there is still a strong chance this happens. but really the question now goes to kim jong-un. does he want to play hard ball, take more sanctions, put more economic pressure or does he actually want to work with the united states in what they seem to have a common dome. your willingness to walk away from the table, puts you in a strong negotiation position. stuart: jason, thank you very much for joining us on a very important day. very appropriate moment. van hipp is with us. >> thank you. stuart: van, you know a lot about north korea. you often supplied us with very original information what is going on there. what do you make of this ending of the summit by president trump? >> i think it is a decision, stuart, that was made in the last i would say 24 hours, about a day or so ago i did talk with senior administration officials

and they felt at that time it would still go on. what it tells me that kim jong-un pulled one stunt too many. this president is holding the cards, he knows it. that's the message he sent today but i do like his letter. i like the tone of it. i think he struck the right tone because it does hold out promise for the future if kim jong-un gets his act together. stuart: what do you think comes next? >> well i think we'll see how kim jong-un responds. i think this president realizes that his first and foremost responsibility is as commander-in-chief, keeping the american people safe. he is not going to be played. i think that he, what the letter also does, is the president and united states seizes what i call the pr narrative on the international stage. i believe, you know, we can go back to doing, i mean he hadn't even begun to see what maximum pressure is. this president is holding the cards. i would pretty soon launch a big-time informational warfare

campaign against him. he has some problems in his country. we can help exacerbate that situation. stuart: would you just hold on for a second, van. i just want to explain to our viewers secretary of state mike pompeo appeared before a senate panel. he read the statement, the letter, which our president has sent to the north koreans. he read that letter and then, because, senator corker is running that senate panel, he thanked mike pompeo for the letter and then said, he now wants to talk about the state department budget, which they are now doing. if there is any headlines coming from that, we'll bring them to you promptly. back to van hipp, we had gordon chang on the phone a moment ago. he suggested that the next step would possibly be, possibly, a blockade by our navy of north korean ports to stop stuff going into north korea physically. that would, if that happens, that would seem to me to be escalation, a military escalation. what say you? >> oh, i like that idea.

you know, some of the sanctions that have worked, have been when china has played ball. china has been playing games lately. don't forget, last friday, stuart, landed a new bomber, nuclear-capable bomber on one of the island in the south china sea. so they have been playing games. the president noted his remarks when president moon was at the white house day before yesterday. the president noted the change in attitude after the second time he visited the chinese. so look, they, i think kim jong-un and the chinese were negotiating but they forgot who they were negotiating with, the best negotiator we ever had. the president is holding the cards. i like the tone of the letter. he is still holding out promise for the future. stuart: would you agree with the following, china tried to play president trump, president trump said we're not playing ball? >> that's right. he is holding the cards. he is holding cards on trade.

he is holding the cards militarily and he knows it. stuart: tell me more about the chinese, is it a bomber that landed on an atoll in the south pacific? >> they continue to play games again and again and this president is not going to be played. look if they want to play that, don't forget, it is time for us, this president is beginning to do that, we saw that in vietnam. who would have thought the united states would be having a military ship, an aircraft carrier go into a port in vietnam? we've seen that now. so the president i think is doing the right things. he is reaching out to old foes, who now have a common interest in the south china sea. 5.3 trillion tons of car go throws through there a year. it is vital to the economy of the free world. the president gets that. look what is going on, stuart, south china sea, north korea, it

is really an international chess game. what i've been saying for a long time, it is the moats complicated foreign policy situation a u.s. president ever faced. stuart: van hipp, stay with us for a moment. i'm going back to the white house and our own blake burman. you have more on vice president pence's thinking. reporter: stuart the vice president was suddenly thrust into this comments by the north korean official that the vice president was a political dummy. i'm told that the vice president was supportive of the president's decision to eventually pull out of the summit. it was reminded to me, the president is the president. es one who eventually decides on an issue this big. the vice president who has been by his side throughout all of this, supportive of the president's final call here, at least for the moment not to go to singapore on june 12th. stuart: from my joint of view, blake, i know you've been following this closely, seems like our administration, our president got fed up with what is going on just below the

headlines. for example the rhetoric about john bolton. the rhetoric about vice president pence. the landing of this chinese bomber in the south pacific. maybe some running around about the destruction of their nuclear site which may have already been destroyed. it seems like they hit a wall and said, enough is enough, the summit's off, is that about right? reporter: excuse me for coughing. allergies are killer this time of year, stuart. no, there is a couple different levels here. one, you have got to the rhetoric, what the north koreans have been saying. senior white house official though is telling fox, look, the north koreans often kind of say these things. so that is one aspect to it. but indications we're getting from the white house on multiple levels in the last few minutes, look beyond the rhetoric of that kind of political dummy type talk. the bottom line here is, we're dealing with a country, the u.s. is dealing with a country who has nuclear ambitions, who recently as of last night threatened some of those nuclear ambitions. that is what the white house is

saying the focus should be on. stuart: blake, all good stuff. thank you very much indeed. take care of those allergies, lad. you have about 90 seconds. no big reaction on the market. we're down just 133 points. i believe louie gohmert, republican texas is being lined up for us. i think he will join us after this break. it's time for the semi-annual sale

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stuart: if you're just joining us the summit between u.s. and north korea on june 12th is off. a diplomatic letter said thanks for the hostages but the summit, the is off. we're at the low of the day. we're only down 2/3 of 1%,

bearing in mind this blockbuster news you might have expected it to go down further but it didn't. it is down 164 points at this moment. i have no clue where we close today of course. that will depend upon developments later in the day but right now we're down just .66%. van hipp, i want to bring you back in again, please. thanks very much for rejoining us here. van, the north koreans made a show this morning, today, of blowing up this nuclear test site. now granted it already has been damaged by their own nuclear blast but they made a big show of flowing it up. do they have another have another nuclear site where they can produce more bombs? >> they have another sight -- site. president george w. bush said if you destroy that site, deactivate that site, destroy your nuclear weapons, we the united states will take you off

the list of state sponsors of terrorism. guess what? this is back in 2005, stuart. we took them off the state sponsor of terrorism list and guess what? they did not destroy the pongyong nuclear facility. that is where they engage in their uranium enrichment activities. yes, they have another sight. not a test site but i would say a big nuclear technology manufacturing site. what i would have liked to see, he invited journalists to and say to the world why don't you invite the comprehensive test ban treaty organization? that is the international monitoring group for nuclear sites, they should be there but i do think what the president did, i said it before, with this letter and his leadership today, he has seized or reseized the pr initiative on the world stage and i think that is important. stuart: now mike pompeo before he was secretary of state, after he was secretary of state he made visits to north korea,

one-on-one with kim jong-un and we're told that he spelled it out. you have got to give up your nukes. that was as you a stretch to believe that the north koreans would actually go that far, it was a stretch, wasn't it, van? >> yeah but you know i give pompeo a lot of credit that he did something no other cia director or anyone in american government had ever done before, and it has come out right after he became the cia director he opened up the back channel to north korea and i think it helped us to at least get to the point where this was possible. so i think, and he is very savvy, he is very good. i think he is burgeoning as one of the best secretaries of state we've had in a long time. stuart: van, i know the north koreans are unpredictable but can you give us any prediction how they will react to this? >> you know, it's, they're going to try to reseize the pr narrative, which i think is going to be tough to do.

i think it probably surprises china. what i would do right now, go back and look at u.n. sanctions that worked, look at ones we wanted, ones china would not fully comply with. oil, they need energy big-time in north korea. studies show they probably don't have enough energy to sustain a significant military operation beyond 30 days. we got the one u.n. sanction in place, stuart, roughly 1/3 of their oil imports into north korea were cut off. we wanted a full 100% ban. that is what the united states and the free world needs to push for now. stuart: van hipp, thanks very much indeed. i would ask you if you stay there a moment. i want to digress, not on this subject but ending the soul mitt on june 12th. liz, you brow up a important point that china trade negotiations are wrapped up in this as well. liz: they were giving an olive

branch in recent days to china over zte, the phone supplier, fourth biggest. stuart: didn't the president walk that back? >> liz: that is what i was saying he gave an olive branch, fine them, do management changes, won't sanction zte. that stirred a cry in senate. marco rubio said don't give breaks to zte. it hurts our military technology. it hurts our national security. you know, i want to say, i would like to say this, according to the reporting it was the threat to north korea that was ratcheting up about the summit. north korea threatened to scans he will the summit. they called off talks with south korea and threatened nuclear war where on this side of the diplomatic aisle the president was extending an olive branch and gestures of goodwill. after the second trip to china, kim jong-un did take a tougher stance of the question is, why did china do that? stuart: very good question. i do not have an answer for you.

i think it is wrapped up into the china trade negotiations. liz: yeah. stuart: we do not have a severe market reaction to this news. we're down 160 points, 2/3 of 1%. when you have an index at 24,700, a loss of 150 odd points that is not a dramatic negative reaction. of course we'll wait for the rest of the day to see how things transpire. we'll have to take a very short commercial break. we'll have a lot more on this story for you after this.

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why not? your hotel should make it easy to do all the things you do. which is what we do. crowne plaza. we're all business, mostly. crowne plaza. (ch(baby crying)eat) ♪ fly me to the moon ♪ and let me play-- (jet engine white noise) (airline "ding") (bell mnemonic) stuart: right about now we're at the low of the day for the stock market. the news background is, the summit on june 12th is off. president trump sent a letter to the north koreans. it is off. and now we're down 183 points. there is one other negative for the stock market and i will

mention it briefly now. existing home sales dropped 2 1/2%. meanwhile the median price of home sales, existing homes, went up to $272,000 per home. liz: that is in the northeast. it went up nearly 260 nationwide from 250. stuart: okay. ashley: stu, 30 year mortgages up to 4.66%. 15 of the first 21 weeks of this year that has gone up. prices are going up. mortgages are getting more expensive. stuart: okay. that is negative into the market. thrown into the other negative, the summit is off. congressman louie gohmert, texas joins us from capitol hill. your reaction to the hard-line ending of the june 12th summit? >> stuart, this is the thing i really appreciate about donald trump. he is not being jimmy carter and bill clinton or hillary clinton or john kerry or obama and going rushing over to beg

totalitarian, evil people to please, please, please, let us work out some deal. that is not what he does. he doesn't go running to the middle east looking for people he can bow to. he says what he is going to do, then he does it. stuart: okay. >> that is something kim jong-un, kim jong-il, wherever those guys may be, they can count on donald trump. he is going to do what he's said he is going to do. stuart: would you hold on a second? >> sure. stuart: i'm getting response from leading democrats, specifically, senator, senate minority leader charles schumer. he with us tweeted this many of us feared that the summit between potus, president of the united states and kim jong-un would be a great show that produced nothing enduring. if a summit is to be reconstituted, the u.s. must show strength and achieve a concrete, verifiable, enduring elimination of kim jong-un's nuclear capabilities.

you heard it, louie. what do you make of it? >> i'm just so grateful that chuck schumer is so consistent. i think that is his greatest attribute. but unfortunately it puts him in the category as all the naysayers when reagan was trying to work out deals, and when he walked away from reykjavik and all the people like, that think like schumer were just, oh, it is the end of the world. its the worst thing. not realizing that what reagan did in turning around, walking away saying no, we're not going to give up on something that important ended upbringing down the soviet union, making america stronger tan it ever had been. that is until bill clinton and obama got through with us. stuart: okay, look, the summit is off. >> yeah. stuart: we don't know any response yet from north korea. >> oh, listen, let me tell you, it won't be off permanently because north korea's going to

find out now what i didn't realize trump was serious b there will be a price that north korea will pay and donald trump will lead us in getting that price for them and then it will be the north korean leader that will come back begging to have some kind of talk. stuart: what do you think the next step is? >> i think it is immediately taking steps to -- well, just like trump is talking about with iran, putting the toughest sanctions they can imagine, turning up the heat even more on china, you know, there is a lot of things we can do that, to put the heat on china. for example, if we go bankrupt here in the united states, then china immediately falls and, there is a big revolution there in china and those people in charge are run out on a rail. so, they, they, they don't have quite the leverage they think they have, and trump is going to

use all the leverage we've got. i'm so proud. he is president now. hillary is not. we'll not rush them over there to give us bigger and better nukes, if they promise not to use them. that is what hillary would be doing if she was president. stuart: louie, you said it all. that is accurate perspective of your personal opinion. i think it is shared by a great many americans. >> i think that is what we're looking at. i'm looking forward to the sanctions. and the kim jong-un family finding out how serious we are now with a serious president. stuart: louie, as always, thanks for being with us. >> great to be with you. the stock market will step up once they see how serious this guy is. it will be good. stuart: we'll take that by the way a new low for the dow industrials. we're down 200 points. that is not a catastrophic loss by any means. liz: right. stuart: well less than 1%. i will check a couple of big names which we always check, how

are they doing in a down market like this. big tech companies, facebook, amazon, apple, alphabet, all of them on the downside. now netflix earlier today hit all-time high and it's still there. no response on netflix to this news. it is up 2.68, reaching 347 per share. check one of the biggest gainers in the dow after, now with that, will be general electric. there you have a bit of a bounce there. 26 cents higher. that will be 1.8%, but you're still at 14.44. as the dow industrials fall a little more now. we're off 223 points. kroger, there is a sock in the news, taking a shot at blue apron. they're getting into the meal kit delivery business. the stock is down 21 cents. price of oil, strangely, i say strangely, because all pressure on iran and venezuela it is down a buck a barrel.

back to $70.92 per barrel. there you have it. there was very strong, not strong, i'm using the wrong word. there was very interesting economic news came out at the top of the hour, 10:00, existing home sales down 2 1/2%. very interesting move there. that is the first same for a long time i've seen a decline in existing home sales. joining us now is the ceo of an outfit called magilla lending, i love that name. the big magilla. good to see you. >> thanks for having me. stuart: i don't want to talk to but the ending of summit with north korea. i want to talk about existing home sales, i want to talk about lending and this report at the top of the hour. the median price for homes went up to 260,000. is that right, lizzie? liz: 257.9-k. stuart: 257.9, median price. gone up. mortgage rate, 30 year fixed average is 4.6%.

>> that's right. stuart: this is not very good news, is it? >> we think it is just fine. [laughter]. stuart: we're in the lending business, aren't you? >> we're in the lending business. existing home sales are down but the supply of existing homes is the problem. we have historically low interest rates. we have a fed chair in powell who is doing a great job. and based on our survey, 8 6% of the lenders we survey, 700 lenders are ready to lend more in 2018 than they were in 2017. pent-up demand in housing. shortage existing homes. builders are having trouble getting homes on line. stuart: i don't get it why there is shortage of homes available for sale. why? prices are rising. wouldn't you think sellers would come out of the woodwork and trade up? >> i think that is the issue.

he have i have to get out of my house to buy another house. those prices have gone up. you have millenials coming on board who will probably buy a new house, but homebuilders are having trouble getting supply out in the hot real estate markets. stuart: in very short run, by short run, six month to a year, you're not going to increase the size of the inventory of unsold homes, or homes available for sale. it's a problem for the rest of the year? >> it's a problem. but, the recipe is there for robust housing market in terms of, willing buyers, low interest rates, and prices. but, we have to trade into another house. that's a problem. stuart: we've just gutted dodd-frank. >> yeah. stuart: we really took away, especially on regional community banks. some of those restrictions on them were just taken away. is, before this happened it used to be very, very difficult, it was really trying to get a mortgage.

you had to jump through hoops to go through the paperwork. >> yeah. stuart: i mean, tell me about it. tell anybody in this room about it. we all suffered big time. ashley: oh, yeah. stuart: will that make a difference now that we changed the rules here? >> absolutely and because you said that, that's why we built magilla loans in the first place, exactly what you said, paperwork, difficulty. which lender is capable of fulfilling my needs on any one given day? now with the regulations stifling the small to mid-sized banks, they had so much difficulty in risks associated with that. what we, administration is doing now with dodd-frank will help businesses, homeowners, and give all of the borrowers more choice is, i bet you are pleased i didn't ask you about north korea? [laughter]. stuart: magilla, i love the name, man. >> thank you very much. stuart: stay there, please. i want to get back to louie gohmert who has been listening to this conversation.

what is your comment on mortgage rates? >> something the stock market will have to get used, that is a fact, the folks in the fed loved the obama administration, loved obama, they kept the rate just so low and lower than really was appropriate for one reason, to keep obama from looking like the worst president in history. trump comes in, the economy turns around because of the things that he is doing. and so what's the fed do as obama's best friend and not being a friend of trump? they immediately start raising rates when things start going well. so, stuart, i think we'll have to get used to the fact that the fed will keep raising rates. that is why i think the bigger reason is home sales are down. people are saying, whoa, wait a minute,'s see if it might come back down. but the fed will do all they can to hurt trump the way they did all they could to help obama. they're going to keep raising rates. we just got to keep growing and get stronger economically

despite the fed. stuart: okay. you just love the fed, i know you do. louie, thank you very much for joining us. >> great to be with you. thank you. stuart: i promise, more "varney" after this. they appear out of nowhere. my secret visitors. hallucinations and delusions. the unknown parts of living with parkinson's. what plots they unfold,

but only in my mind. over 50% of people with parkinson's will experience hallucinations or delusions during the course of their disease. if your loved one is experiencing these symptoms, talk to your parkinson's specialist. there are treatment options that can help. my visitors should be the ones i want to see. ♪ ashley: in the last hour thomas homan, he is the top guy at

i.c.e., told us under president trump the tide is turning in the fight against that ruthless gang ms-13. take a listen. >> i would say we're winning. we're attacking. we'll continue to fight until we totally dismantle this organization. these are people who are not just killing young kids, they're torturing them. so when you think of the parents i met yesterday who had to live every day with the thought their child was just not killed, their child was tortured, macheted. what a horrific, horrific death these parents have to live with every day. so we got all hands on deck. we have a president that has our six on us. we're putting all resources at it. we've had significant impact since this president hats been in office. we'll continue this fight until they're destroyed. ♪ ♪

stuart: it was literally, i'm going to make a guess here, half an hour ago, that we got the news, that the summit is off. the summit was canceled by our president. president trump sending a letter to the north koreans saying look, it's off of the president did not like the rhetoric used by north koreans recently threatening america, threatening our people. he didn't like it. he says, thanks very much for giving us the hostages back but no thanks on the summit. it is off. ash. ashley: he talked about the tremendous anger and hopes tilt saying in his letter to the north -- hostility.

it is inappropriate to meet right now when we have this back and forth and rhetoric from north korea. to your point, there is a tone in here. he is not totally shutting it down. in concluding his letter, he says, if you change your mind having to do with this most important summit please do not hesitate to call me or write me. i felt a wonderful dialogue was building up between you and me. ultimately only that dialogue that matters. some day i very much look forward to meeting you. so always keeping the door open is a very well-written, the tone here is strong but again not closing the door. and we've had other people, jason chaffetz, the former congressman, telling us this morning, stu, he says look, this isn't off the table. there is still about three weeks to go until june 12th. who knows. but at this point it is shut down. stuart: it is indeed. i've got one other item of foreign policy news to bring to you and that's this. secretary of state mike pompeo, he is testifying in front of a senate panel as we speak and he is testifying, he is mentioning at least iran.

he is saying that regime change, in iran, is not on the table. it is not one of the options that they are looking at. so he is walking back the rhetoric, a little bit, on the iranian situation. but he is the guy, he is the secretary of state. and earlier he read in front of the senate, the letter that president trump had sent to the north koreans. ashley: getting back to the iran issue, what is interesting, they are appealing to the iranian people, we see protests in iran. the state of the economy and the stranglehold that the religious leaders have on that country. there are a few cracks appearing. i think that is where the u.s. put most of its rhetoric. stuart: it is fascinating. ashley: it is. stuart: ending of the summit on june 12th. not going to happen. the president walks away from that senate. our secretary of state testifying before the senate taking about iran where things are really warming up since they pulled out of the treaty there. ashley: yep. stuart: you have the element of china trade. ashley: yeah. stuart: we have just ended the idea of the summit on june the

12th. china is very much involved on that, in that. so you are wrapping in china trade talks into the north korea situation. ashley: i don't know if i agree with that, stu. i think they can still talk about trade with china and put a line down what is going on with north korea. we rely on china to get north korea in check, if you like. but i still believe separately we can get some sort of dialogue continuing on the trade talks. liz: what is the play for china is, they don't have the pressure of north korea talks any longer and they can extend these trade talks with the u.s. and get bargains they ban. however you can imagine that the trump administration will get tough on zte. stuart: i would imagine so. he can do that. now the stock market, keep referring, i used the same expression, i do apologize, it has not taken it on the chin. yes it is down, a 200 point loss. you know when you have a 24,600 index, that is not a huge loss by any means. it is actually less than 1% down. we're off 222 as we speak.

similar losses for the s&p. similar losses for the nasdaq. all those big tech names, all of them on the downside. that's where we stand this thursday morning. rich edson joins us now. he is in, at the state department i should say. what can you add to our knowledge of the ending of the, ending of the summit and what mike pompeo is saying about the iranians? reporter: he extend ad lot more context the reasoning why the administration decided not to do this summit on june 12th and the reason he says is, the united states, state department put the prep teams in place to try to plan this summit between north korea and the united states and simply they hadn't heard back. pompeo says that we were rock and rolling, ready to go and we weren't getting a response from north korea. you couple that with the rhetoric that the united states had been hearing from north korea, that is the reason that the president decided to send the letter that he did today. on top of that, stuart, the secretary still says i'm still

optimistic we'll reach the point where we can reach a deal, where we can actually discuss this. the president notes in his letter, change your mind, kim jong-un, let me know, give me a call. the idea it might be dead, this is probably one of the many stages analysts pointing out, back and forth and ups and downs before this would actually happen, stuart. stuart: rich, could we say we, america, president trump, has chucked the ball back into their court? reporter: absolutely and hes has done so very publicly. the way pompeo put it, look, we're ready to negotiate. we had inheard back from you. this is the next step, with your rhetoric, reluctance to engage on planning with us, let us know when you're ready to talk. that is what the message from the u.s. is. stuart: could you comment on what mike pompeo said about the iran situation? i believe he has said regime change, ending the rein of khomeni is not on the table, it is not an option?

he said that, right? reporter: he just said that in this hearing. essentially what he wants the united states position, he sent out a dozen demands iranian regime. this ballistic missile program, interference throughout the middle east. he wants that all to end a permanent destruction of nuclear enrichment in that country. he wants european allies on board. iranians have put out their demands, they're telling iran, europeans, ignore any u.s. sanctions. pure answer are in the middle of this one. stuart: stuart: rich, you cover state department and foreign policy you have a very busy day. reporter: day, week, year, my friend. stuart: rich edson, i'm sure we see you soon. the market at session lows. down over 200. we'll be back.

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stuart: secretary of state mike pompeo is testifying before a senate panel. of course he has addressed the ending of the summit meeting between kim jong-un and president trump june 12th. that summit is off. pompeo has gone on to say he does regard kim jong-un as a strong leader. seems to me that maybe our secretary of state is negotiating directly with the north koreans and very publicly, praising kim jong-un, and making sure that the lines of communication are still open.

the bottom line reaction from almost all republicans we could find is that the president has taken a strong stand ending the summit. they approve. they want him to take a strong position in this situation. meanwhile the democrat leader, that would be charles schumer, senator schumer, he is the senate minority leader, he tweeted this:many of us feared the summit between potus, president of the united states, would be a great show that produced nothing enduring. if a summit is to be reconstituted, the u.s. must show strength and achieve a concrete, verifiable, enduring elimination of kim jong-un's nuclear capabilities. that is from the leading democrat in the senate. come on in please, blake burman from the white house. i think you have more information? actually, i want to know when will we hear more from president trump? reporter: 11:30. the president will speak on camera. remember, stuart, he is set to sign, oh, by the way the dodd-frank rollback bill into

law at 11:30. if i would have told you a couple years ago that would have happened and gotten little to no coverage you would have called me nuts. i guess i've been called worse than that so i will keep it. so, yes, we're going to hear the president at 11:30. will reports ask questions? of course. will the president answer them about north korea or stick to the letter and mike pompeo up on the hill? i don't know. he made prepared remarks on north korea. i don't know. in any event it will be must-watch television we hear from the president roughly 34 minutes from now. by the way, stuart, i should reiterate, all the indications that we are getting from multiple white house officials throughout this white house, is that the comments that were made in which top north korean official called vice president mike pence a political dummy is not necessarily the reason the president pulled out of the summit. it is being made very clear to us the threat of nuclear to nuclear showdown was essentially

last straw for this president. stuart: blake burman, thank you very much indeed. the dow at session low of the day. we're minus 270 as we speak. stay right there. hot news day. we'll all over it. back in a moment.

stuart: it is 11:00 here in new york, and the big news that broke about an hour ago, president trump canceling the june 12th summit with north korea. it is off. quote from the president's letter which went to kim jong un: i was very much looking forward to being there with you. sadly, based on the tremendous anger and open hostility displayed in your most recent statement, i feel it is inappropriate at this time to have this long-planned meeting. listen to what secretary of state mike pompeo just said about it. roll tape. >> the american team's fully prepared. i think we're rocking. i think we're ready. i think we're prepared for this meeting. i think president trump's prepared for this meeting. we were fully, fully engaged

over the past weeks to prepare for this meeting. stuart: but then they got no response, and the meeting's off. this all comes literally hours after north korea says it destroyed its nuclear test site in the presence of foreign journalists. i do want to clarify, according to our blake burman at the white house, pulling out of the summit is not just in response to kim jong un's anger at vice president pence, it's also in response to north korea's threat of nuclear war in a statement that was released last night. and the president is already gaining support for his decision. look at this, it's a tweet from senator marco rubio. kim jong un, in the words of a wise man, congratulations, you just played yourself. withdrawing from talks with north korea is 100% the right decision. kju doesn't want a deal. he has deliberately sabotaged the talks over the last two weeks and was setting us up to take the blame. and, of course, the left is commenting. this from senator charles schumer: many of us feared that the summit between potus and kim

jong un would be a great show that produced nothing enduring. if a summit is to be reconstituted, the u.s. must show strength and achieve a concrete, verifiable, enduring elimination of kim jong un's nuclear capabilities. this is a developing story, and the stock market is at session lows almost, down 250. we're on it. this is the third hour of "varney & company." ♪ ♪ stuart: it's happening now, president trump's expected -- he will speak at 11:30 eastern time in the morning at a bill signing roll back bank regulations. we expect he's going to say something about canceling the north korea summit. joining us now former white house press secretary ari fleischer. okay. this kind of sudden, it was certainly dramatic. do you approve?

>> absolutely. stuart: really? >> i've been a cynic about this detente with north korea from the beginning because i've lived through the 30 years of lies and deceptions every time they somewhere into an agreement with the united states they renege. and they continue to develop nuclear weapons in contradiction to everything they promise. frankly, i view this as part of the ongoing talks. this is the middle, this isn't necessarily the end or even a permanent cancellation. this is maneuvering. siewfort stuart well, the president hinted, suggested perhaps in that letter that he wrote to kim jong un that the summit could be reconstituted at some point. you're right. it's not over, it's not done, it's not kaput forever. this could be reconstituted forever. >> this is about gaining leverage. this is about the united states doing something wise here under president trump here which is being unpredictable. one of the advantages north korea has always had over us, the more predictable we are, the more they take advantage of us. here comes the bull in the china shop, donald trump, the rude man

who actually knows how to deal with someone like kim jong un. stuart: the understatement of the decade. [laughter] >> it can be an advantage. stuart: i think in this case it is. >> do you remember when the president went to the gridiron dinner and said i'm crazier than kim jong un? [laughter] he knows what he is doing when it comes to dealing with somebody like him. stuart: i'm asking you to be wildly speculative. what do you think kim kim jong s going to do? [laughter] >> that's why this is very smart of donald trump. he has kind of gotten to the fringe of kim jong un -- stuart: got him in a box. >> in a smart way, that's right. and because kim jong un is so used to america doing what he, his father and his grandfather always did to get a good result for north korea where north korea was rewarded -- they received energy, food, financial support, all the while they deceived us and developed nuclear weapons. now he's realizing my old games probably won't work with this

guy, so it does put kim jong un in a different spot. i think what happens is either we go back to those war of words we used to have, and then the maximum pressure campaign must continue, or kim jong un realizes maybe i should start to deal with donald trump. stuart: but he would lose enormous face, and in asia loss of face is a big deal. >> when you're a totalitarian dictator and you run the country the way he does, i'm not so sure saving face is important. the man is personally wealthy because he's stolen it, but when donald trump says i'll make north korea wealthy, i don't think that's meaningful to kim jong un. he cares about power. stuart: where does china stand in all of this? >> that's a great question. i think they say this is rocky, this is not stability, so which of these crazy leaders do we want to tell, behave? stuart: do you think they'll lean on north korea? >> i think they will, yes.

it resets the table and creates stability to -- so china doesn't have to worry about it. that's probably what they'll do again. stuart: we do actually have leverage on china, because the u.n. sanctions call for an end to bank dealings with north korea, and there are three chinese banks that are dealing with north korea. if we put sanctions on those banks, we have leverage. >> donald trump has gone farther in achieving sanctions than either of his pred access e sores, including my boss, i have to say. and he's pressured other nations to go farther than they've gone before, and they've gone along. maximum pressure campaign is our best tactic. stuart: the voice of steady reason, ari fleischer. where you been? [laughter] thanks for joining us, thank you very much. now, look at the market for a moment. we're off the lows of the day. we're still pretty close. we were down about 280 at one stage, now we're down 240. that's just under a 1% loss. and if you look at the dow 30 stocks, it is a sea of red. 27 of them are down.

you've only got 3 that are up. fox news contributor scott martin joins us now. you know, scott, i'm a little surprised. i thought the market would react in a much more negative fashion. even though it's down 230 points, i think that's a subdued response. what's your reading? >> yeah, i agree. the day's not over yet, so we could see a slow bleedout throughout the day, but i think your question to mr. fleischer was right, how does this look with respect to china and those trade talks, because at some point china's going to have to pick sides here. and depending on where they go from there, that affects many, many s&p 500 companies. that's why i think you're seeing the major pressure on the market. stuart: this uncertainty with north korea, the summit and the uncertainty with iran as well and with china and china trade, that would seem to me to be a negative for a long time to come. so my real question, scott, is does this put a cap on any future senate upside move for

the -- significant upside move for the market? >> until there's clarity, yes, stuart. i would mix in nafta, another trade deal that trump has talk about renegotiating. it just calls into question at least as far as the market is concerned and the way the market reacts to things, it calls into question the trump agenda and what he can actually get done. it's probably not going to take the chuck schumer approach where everything's over now, but just the approach that, hey, maybe things are more uncertain than we thought they were, so the sellers are coming into the market. stuart: you're right, we should not forget the other item in foreign policy, and that is nafta. i mean, the president is proposing as of this morning to place a 5% tear -- 25% tariff on imported cars. that would hit cars very strongly that are made in mexico and exported to the united states. so you're saying if you don't fix this nafta thing pretty fast, that's another big negative down the road for the market. >> yeah. and, i mean, nafta's a major threat. that one feels pretty hot right

now. i mean, that one feels like trump is really going to follow through with that, so that's a definite concern. if you're sitting at home thinking, okay, what do i do about this gee yahoo! political mess -- geopolitical mess, there are some things that are working. bond rates are coming down, bond prices are going up, so that's good if you have those, and also gold. in the last couple days, stuart, we've been adding gold to our portfolios as a lot of these talks have frayed in the last couple days, it almost looked like it was going to fall apart. it did this morning, so gold is rallying on that news. stuart: up $15 an ounce as we speak, back to $1310. all right, scott, thanks very much for joining us on a crucial day. we appreciate your input. thank you very much, sir. >> see ya. stuart: president trump just tweeted on this. nothing new, but i'm going to bring it to you. i think this is part of the letter, is that correct? no. >> yes. stuart: it is, this is part of the long letter. >> the whole letter. stuart: sadly, i was forced to cancel the summit meeting in

singapore with kim jong un. he included a picture of the letter he sent, so it's all in a tweet that the president just sent out. and as ashley told us earlier, he read this letter on the air. there it is -- ashley: yeah. now everyone can -- stuart: now everybody can. you made a very good point, it was couched. end the summit, couched in very diplomatic language. ashley: not slamming the door shut at all, saying, listen, please give me a call, write me if you like. i still believe this is all about relationships, and it's all about the dialogue that was building up between myself and you, and let's, you know, we can continue that, then maybe there's hope. stuart: well said. thank you, ashley. now here are some more headlines that we're following for you. there is other news, believe me, there is. homeland security officials say about 450 from that migrant caravan have made it into the united states. where are they now? we will ask brandon judd, president of the national border patrol council.

the cbo, congressional budget office, say that the obamacare premiums will increase 15% on average next year. betsy mccaughey, our voice on obamacare, will break it down for us. and in about 20 minutes, we're expecting to see the president sign a bill that repeals most of dodd-frank. this is all about deregulating the banks, but we really want to hear if our president's going to say anything about canceling the north korea summit. stay with us, jam-packed hour ahead. the third hour of "varney & company" just rolling along. ♪

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stuart: strangely, the price of oil is n today. i would have thought it'd have gone up with the pressure on iran and venezuela, but it's down, $71 a barrel. price of gas keeps on going up. we're at $2.96, the national

average. two cents higher than yesterday, twenty cents higher than a month ago. look at the $3 club, 16 states and the d.c., district of columbia, have joined it. that's where prices average $3 or more for regular. now this, the cbo, bean counters in congress, okay? is they say that obamacare premiums will go up an average of 15% next year. 15%. joining us now, "beating obamacare" author betsy mccaughey. >> it's hardly worth discussing, stuart. almost no one's going to pay it. but even more importantly, by 2019 obamacare premiums will have gone up 300%. they will have tripled since obamacare was first offered on the market, tripled. so this 15%, let's be clear, the democrats are trying to pin these new premium hikes on the trump administration. but, in fact, the big premium hikes occurred buff the flaw in -- because of the flaw in obamacare. don't is ask the politicians,

ask the experts, mckenzie management consultants, millman, insurance experts, have all pointed to the same cause, the single provision that forces healthy people to pay as much as chronically ill people for care. stuart: so yet again we have dismissed obamacare and these premium hikes because what we really want to talk about is this, ain't that right? listen to this. the irs says it's going to crack down on those high-tax states that try to issue work-arounds to the cap on state and local tax deductions. the irs says we're not going to do that -- >> let's be honest, they're not work-arounds, they're flimflams. they're farfetched schemes to call your state and local tax payments charitable contributions? come on. stuart: what you're saying is if you live in high-tax new york, new jersey, california, maybe illinois, maybe connecticut as well, you're screwed. forgive the language. >> that's right. the top 1% of earners in new

york, for example, customarily deduct $500,000 a year in state and local taxes. now that deduction will be capped at $10,000. stuart: say that again, did you say -- >> the top 1% of earners in new york deduct -- stuart: is that new york state or city? >> new york state. deduct $500,000 in state and local taxes. look at their returns, that's what they're deducting. and now that will be capped at $10,000. stuart: they're going to blame the trump tax cuts. >> no, blame the real -- elizabeth: i know how the democrats say tax the rich, and as soon as you tax the rich, they don't like it, and they do an end run around it. >> that's right. the real problem is not whether the taxes are deductible. the taxes are too darn high. ashley: in the first place. >> deductibility has coddled these spend-a-holic politicians in blue states like andrew cuomo in new york, and finally they are scared to death because

people are heading to the exits. stuart: you and i -- you live in new jersey, i think. >> yeah. stuart: i live in new jersey. >> yeah. but listen to this -- new jersey, yeah. [laughter] and connecticut's just as bad. the fact is if the new york state budget is twice as big as the florida budget even though florida has many more residents, how come it costs twice as much for the state service in new york? there's something wrong, stuart. stuart: you are correct -- well, you're the former lieutenant governor of the state of new york. [laughter] you should know about this. >> we lowered taxes when i was lieutenant governor. stuart: get that in. [laughter] thank you very much, great to see you again. great stuff. a couple of stocks in the news. look at tesla. elon musk went on a twitter storm rant against the media. the stock was $389 a share, that was back in september. now it's $277 and down a little bit today in an overall down market. kroger, very much in the news recently. they're getting into the meal

kit delivery service. the stock is down eight cents. now williams sonoma, you know those people who sell you expensive -- our producer likes to say the $40 spatula. [laughter] okay, they sell a lot of them, apparently. their outlook is rosy, the stock's up 13%. now let's get to really important stuff. in about ten minutes, we're expecting to see the president -- we will see him, that's a promise. and when we do, we're going to expect him to say something about canceling the noko summit. do not miss this. must-see viewing on this program. we'll be back. ♪ ♪

let's get started.

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i'm 85 years old in a job where. i have to wear a giant hot dog suit. what? where's that coming from? i don't know. i started my 401k early, i diversified... i'm not a big spender. sounds like you're doing a lot. but i still feel like i'm not gonna have enough for retirement. like there's something else i should be doing. with the right conversation, you might find you're doing okay. so, no hot dog suit? not unless you want to. no. schedule a complimentary goal planning session today with td ameritrade®. stuart: we're down but not as much as we down. at one stage we were off, what, over about 270 points for the dow, now we're down 190. so the loss is .78%. now, this is important because president trump, well, he is going to speak in about ten minutes -- less than ten minutes from now. now, earlier today he canceled the summit with north korea. i hope he's going to talk about that ten minutes from now. blake burman at the white house,

would you just set the scene for us, please? because we want to hear about north korea. i want to know are there going to be journalists in the room that will shout questions? >> reporter: it ises the roosevelt room in the west wing. this is often a format that we see the president in, stuart, because he's going to be signing the bill that rolls back parts of dodd-frank. so the president, we've gone through this now 15, 16 months, you know what happens. he goes in there, he talks about it, he signs it, he holds up the bill and it's a nice spectacle for him and a big victory for this white house. but that is secondarily, secondary if not even much further than that because, obviously, the main issue of the day is north korea. we do expect that questions will be shouted to the president on this, might he talk about it beforehand, afterwards? who knows. [laughter] but we -- you know, you get to go off air at noon. i've got to cover this for the rest of the day, stuart, so i hope we hear from the president on it. stuart: can just remember, blake, air time is good time.

[laughter] >> reporter: there you go. stuart: i do want to go back to the main reason for the president canceling the summit. it was the rhetoric about nuclear war. tell us again, please. >> reporter: yeah. it was a comment from a top north korean official. they said this, quote: whether the u.s. will meet us at a meeting room or encounter us at nuclear, nuclear showdown is entirely dependent on the decision and behavior of the united states. that is the quote specifically that this white house is pointing to saying, hey, look, the comments about the vice president mike pence being called a political dummy, that is second tear to the fact that last night the north koreans -- in the midst of all of this dialogue and good feelings and warm talk that was building up -- once again threatened a potential nuclear showdown. by the way, stuart, mike come pay owe testifying -- mike pompeo revealed that for many days now, as he put it, they had been trying to communicate. the details of this june 12th summit. and they had heard nothing from the north koreans. add that to the comment that was

made last night, and you're starting to get a bigger picture of what happened here. stuart: no summit. all right, blake, thanks very much, indeed. you've got to get to the roosevelt room. off you go. see you later. [laughter] we are going to take a short break, but moments from now the president will start this banking deregulation. it's a signing ceremony. but what we want to hear or is about the cancellation of the summit. we'll bring it to you in a moment. ♪ ♪

stuart: the dow jones industrial average down 180 points as we speak. meanwhile, left-hand side of your screen, the white house. moments from now president trump will be speaking in the roosevelt room. we hope he's going to be talking about the cancellation of the summit with north korea. as we wait for the president, i'm going to bring in "the wall street journal"'s dan henninger and also our own judge andrew napolitano. first to you, dan henninger. do you approve of what the president has done in canceling the summit? >> oh, absolutely, stuart. i mean, i think i've said here several times on fox that there was no way that the president of the united states could go to a summit with the head of north

korea in singapore and get nothing for it. and it has become obvious in the last week that he was not going to get anything for it. but i think what he has done here has exposed the fact that the north koreans, for the north koreans it's business as usual. they want recognition of their nuclear program, and they were going to want payments for trying to denuclear arize. that's -- nuclearize. the president in good faith went the extra mile to try to get kim jong un to talk about denuclearization. the north koreans pulled back. so nothing ventured, nothing gained. i think we're in the right spot. stuart: actually, the north koreans have been threatening nuclear war. they've hinted indirectly at it just a couple of days ago. elizabeth: last night. stuart: and mike pompeo, secretary of state, moments ago said, look, we were preparing the ground in singapore. we were asking them what kind of arrangements you want us to make. they got nothing back at all from the north koreans. >> right.

and so now what -- we go back to the status quo ante before this happened which was maximum pressure, military pressure on north korea. and i hope the president does not get accused now of warmongering if he puts back maximum pressure on north korea because he really did go the extra mile, praising kim, saying he was going in the right direction, willing to go over and negotiate with him. and the north koreans are the ones who have pulled it back. stuart: we are getting some reaction from the democrats, and we'll bring it to you in just a moment. nancy pelosi has made some statements about the cancellation of the summit. we're just preparing that, getting it dead right. you will see it and hear it momentarily. meanwhile, judge napolitano -- >> i agree with everything dan said. if you know this thing is not going to come about or if you know you're not going to get anything material from it, far better for the president of the united states to cancel it, showing an image of command and being in control and grasping the situation than kim jong un canceling it and embarrassing

the president. and as for the i way he canceled it, it was like an iron fist inside of a velvet glove. the words were so diplomatic, almost un-trump january, and i'm saying that by way of compliment not criticism, just came across nicely. stuart: hard line wrapped up in diplomacy. >> there you go. stuart: who knew that was going to come from president trump? [laughter] moments ago nancy pelosi said this about canceling the summit. roll that tape. >> this takes preparation, this takes knowledge, this takes judgment and, clearly, it takes preparation which the president didn't make. it's clear he didn't know what he was getting into, and now he's walking away from it. stuart: the president didn't know what he's getting into. of. ashley: really. elizabeth: that's really opportunistic. stuart: yeah? >> it's also foolish. these people want to take over the house of representatives.

the farther left they go, the more absurd they sound the less of a chance they're going to have for this victory they're counting on in november. stuart: mike pompeo directly contradicted what nancy pelosi just said. he said, look, we've had diplomats trying to organize this, arrange this, preparing this summit. ashley: yes. stuart: and we got nothing back from the north koreans. that's one of the reasons why it was canceled. >> pompeo went over there twice himself to talk to kim jong un. and i think the american people were extremely concerned. they realized that the north koreans had this missile and the nuclear device, it was a clear and present danger. they wanted the president to do something about it, that's what we have just witnessed over the past three months. and the idea that nancy pelosi is now criticizing him for doing the wrong thing, i think the judge is exactly right. they're going to pay a political price for that. stuart: okay. what you're looking at left-hand side of your screen, that's the roosevelt room in the white house, the west wing of the white house. you can see wilbur ross right there, other faces that you well

know. mnuchin is there, congressman duffy is there. okay, they're putting the names in my ear. [laughter] i can't keep up with it. i do recognize senator scott right there. we're waiting for the president. he will -- now, the first thing he's going to do, i believe, is sign into law this cutting of the regulations on financial companies, otherwise known as dodd-frank. this is a bill-signing ceremony. that's what it's for. however, bearing in mind the news that came about an hour ago that the trump summit with kim correct me if i am jong unis off, i suspect that is going to be the focus of attention. when the president's done signing that bill, he's going to be pepperedded with questions. >> is the press there in that room with him? stuart: i believe they are, yes. and that is a live camera picture. so we're going to see it all when it starts. elizabeth: the way the story unfolded was it started out where it seems optimistic with north korea's rhetoric toward the united states. stuart: yes.

elizabeth: then north korea canceled the meeting with south korean initials, then they threatened to pull out of the summit, then last night they threatened nuclear war with the u.s. so the president said in his letter this comes amid open hostility from north korea toward us, and he said you talk about your nuclear capabilities, ours are so massive and powerful, i pray to god they will never have to be used. ashley: we know he's got a bigger button. stuart: the president right now is probably in the oval office just down the corridor from the roosevelt room which you are looking at as we speak. i wonder what he's putting together. i wonder if he's putting together a few one-liners. i wonder if he's putting together a paragraph or two to address the north korea thing. ashley: maybe. he ad libs, that's his thing, that's his forte, and that's when we get our best sound bites, let's be honest. elizabeth: yeah. and it's interesting how we saw this unfold in realtime. we would not have seen this back and forth under prior

presidencies, and i think dan is absolutely right. this is 3-d chess with chai -- china and north korea. get what we went in terms of economic concessions for a country which is the size of togo when it comes to their economic growth. stuart: i would not be at all surprised if president trump didn't quote nancy pelosi. she said he doesn't know what he's getting into. ashley: yeah, he wasn't prepared. stuart: yeah. that's so donald trump. that is so president trump, go right at it. you said this? elizabeth: well, she's wrong again. stuart: let's see what the president -- ashley: he feeds on that. >> trump is very impatient with stalemates, and he tries to bust through them. that's his operating style. once he had done that, he had his team -- previously h.r. mcmaster and now john bolton and mike pompeo -- who were negotiating this. i'm sure that's all they did all day long every day with the north koreans to try and work something out and the chinese.

and trump, at that point, had made a lot more progress than previous presidents. okay. you win some and you lose some in trump's world -- elizabeth: and giving concessions on zte, for example. >> absolutely. stuart: you may well see more negotiating in public. >> sure. he loves to negotiate in public. stuart: as we speak, because just moments ago mike pompeo before a senate panel said, look, kim jong un is a strong leader. i think i've got the words right. kim jong un is a straight leader. he was talking directly to kim jong un. >> absolutely. stuart: if when the president comes out, he's going to be speaking directly to the north koreans as well. >> so let's see if we see more of the iron fist or more of the velvet glove. stuart: yes. ashley: bit of both. [laughter] stuart: knowing this president, you'll have a little bit of both. >> john bolton scripting what he's writing or mike pompeo? stuart: nobody scripts for the president, i don't think so. [laughter] ashley: it'd be interesting the know who wrote this letter. >> this letter is brilliant.

ashley: yes, it's got the president's signature, i'm sure he had input, but it's very well crafted. let's put it that way. stuart: just read the first paragraph. ashley: we greatly appreciate your time, patience and effort with respect to our recent negotiations. is that president trump? and discussions relative to a summit long sought by both parties. i felt a wonderful dialogue was building up between you and me and, ultimately, it is only that dialogue that matters. please do not hesitate to call me or even write me. >> it's almost lawyer-like. >> the last sentence about the massive nuclear -- that was trump. stuart: yes. [laughter] jeff sessions wrote most of it. [laughter] >> where is jeff sessions? stuart: ashley read out the entire letter earlier. we're not going to do that again, but couched towards the end of the letter was the suggestion that this summit may be off, but it's not discounting other summits that may -- ashley: no. elizabeth: yeah.

it could be revived, for sure. and what did the president get in the process? three prisoners freed by north korea, got china to reduce their tariffs on, i think, automobiles to less than 15% from 25%, possible destruction of a nuclear site that was probably moribund anyway because there's one still up and running 50 miles north. so it looks like he walked away with some, you know, some things there. ashley: i very much look forward to meeting you. and as for the hostages, that was a beautiful gesture and very much appreciated. so the judge's point -- [laughter] there's the velvet and then there's the sledgehammer. stuart: we got something out of it. we got some guys back. now, let's get serious. dan henninger, address the china issue. >> well, it was just, i think, about a week ago that president trump himself was saying in one of these offhand sets of remarks noting that kim had made this second trip down to china. the first one they anticipated, they did not anticipate the

second. and he said he was concerned about what the chinese and kim had talked about, and that was when he started talking about the possibility that maybe this summit is not going to happen. so they clearly believe there was an element of chinese involved xi jinping, and we don't know what he said to kim jong un. stuart: how does that rebound in the china trade talks? >> well, that's an excellent question because all of these things are interrelated. some of us thought, well, if you need the chinese help on that, you don't want to push them too hard on the trade talks. and as liz was just suggesting, zte looked like an effort by the president to ease off a little bit on the trade issues possibly so that the chinese would help him with kim jong un. but we're a little bit back to square one here now with this summit being called off. >> stuart, do you think kim jong un learned about this when we did, or do you think the diplomats told him in advance something's coming, and we're

probably not going to see you in singapore? stuart: i wish i could answer your question. i honestly can't answer your question. >> i'm going to guess he knew in advance. elizabeth: we talked about the white house was not a prize of china speaking to kim jong un in the first visit. >> danny said something that made me think when was this decision made. i don't think it was made this morning. it probably was made before the president spoke about it two days ago. stuart: let me introduce you to dan henninger. [laughter] you called him danny. >> i'm making him irish. [laughter] >> i'm half irish. >> thank you, danny. stuart: now he tells us. ♪ oh, danny boy -- >> i can't come on anymore, but -- [laughter] stuart: look, this is a surprise to me. when this news broke, i thoughting the market would just go straight down because you don't know what's coming next. i mean, china trade talks, who knows what the influence is going to be. but you've got a loss of a mere three-quarters of 1%, a loss of

184 points. it sounds like a lot, but in percentage terms it's not. the dow is still at 24,700. implies to me that investors are not considering this to be a really big negative -- elizabeth: well, it was existing home sales tumble that also -- stuart: that didn't help. elizabeth: right. stuart: but this canceling of the summit -- ashley: it's a fluid situation. stuart: i mean, microsoft -- ashley: it's not all or nothing. stuart: i'm losing my shirt on microsoft, it's down a buck. >> is that why you're so animated? [laughter] stuart: i'm very animated, sports gaps. if you're just gowning us, we are awaiting -- joining us, we are awaiting president trump. that is the roosevelt room at the white house you're looking at. dignitaries of the political parties. i've seen mostly republicans, no democrats at this point. the republican elite has assembled what is supposed to be a bill signing. the president will emerge from that door in the back there and sign the changes to the dodd-frank rules, the financial

rules. he'll sign that. but what we're all waiting for, what is exciting here is will the president say something more about the cancellation of the summit on june the 12th. he did that about two hours ago. and we're all waiting to see what he's going to say right now. >> i think when he does come on, we should look very closely at the nuance of the president's presentation, certainly the substance of it. but we're at a very serious inflection point here with the cancellation of this summit. this is not like trade negotiations, life goes on, people make deals. the north koreans have gotten to the point where they are almost capable of delivering a nuclear weapon to the american land mass. that is why this is so serious. and now the united states is going to have to continue with some sort of strategy. the strategy before the summit negotiations was maximum pressure, moving a lot of military assets in there. we don't know what the schedule of events is that they have

decides on, but if they get pushed to that, we're going to be in a serious -- >> you have to hear mrs. pelosi's latest. quote: kim jong un must be having a giggle fit. she tribes the president's letter -- she describes the president's letter as a valentine to him. this is mrs. pelosi who wants to be returned to number three in the government. stuart: repeat that. >> kim jong un, quote, must be having a giggle fit, closed quote, at trump withdrawing from the summit. she describes the president's letter as, quote, a valentine. elizabeth: that's breathtakingly unserious right now. >> yes. elizabeth: given what dan just said. >> yes. elizabeth: because we have been under democratic and republican administrations that allowed north korea to get a nuclear weapon pointed now at the west coast. and we also have to bring up what's going on with iran to the judge and dan's point, because now china and germany and other european countries are going to stay in the iran deal. so the landscape is now shifting

diplomatically. stuart: okay. what have you got, ash? ashley: our executive producer pointed out that's heidi heitkamp down in the front left, so there is a democrat there, but i believe her republican challenger in the north dakota senate race, kevin kramer, is also in the room, which is interesting. >> i tell you what a showman the president is? he has us on tender hooks waiting for that door to open. he may very well be watching, and we want to be watching him. [laughter] stuart: he's watching us. did you say, justin, did you say that heidi heitkamp is the only democrat in the room? >> i'll bet you -- this is a bipartisan bill. >> yes. >> this is a bipartisan congressional achievement. they're very proud of it. and you've got nancy pelosi out there booing on it with these insults to the president. stuart: yeah. i'm going to repeat what nancy pelosi just said.

kim jong un must be having a giggle fit after the cancellation of this summit, and she went on to say that the letter from president trump canceling the summit sent to the north koreans was, essentially, a valentine. you're right, liz, that is an extraordinary degree of unseriousness. elizabeth: an important moment right now. stuart: that really is hard to take. >> frivolity. stuart: thank you. good word. nancy pelosi confidently believes that she is going to be the next speaker of the house. can we imagine the speaker of the house treating this kind of incident in that kind of -- ashley: no. stuart: dan? >> she's playing to the progressive left. she needs their support. they're the ones who feel they're in control of the party right now. meanwhile, i think the american people desperately want these two parties to work together to accomplish things. ashley: yes. >> that's what's happening with this banking bill today that puts nancy pelosi outside of the mainstream of where most of the american people want to be right now. and i think they're just reporting, the real clear politics average on the generic between democrats, republicans

on the november election, it's down to three points. stuart: wait a minute, did you see the reuters poll on precisely that subject, generic democrat versus generic republicans? they've got republicans up six points. that's the latest. so there's a swing there in political attitudes in america. [laughter] nancy, change your tune. ashley: no, nancy, keep going. that's what you want to say. stuart: depending on which side you're on, of course. again, i have to say i don't think we're down by a cataclysmic selloff bearing in mind what we've got going for us here; the cancellation of the summit. but, dan, earlier today we had gordon chang on the show. he's our china expert, okay? he says the next step may be that america's navy blockades or prevents stuff going into north korean ports. that would be an escalation. that would be a form of military action. what do you say? >> yeah.

i mean, and i don't -- it would not surprise me that the pentagon has that on its list of possible things to do. until be a huge move if they were to blockade north korea. i mean, that's just one step short of war, and then the north koreans might start threatening the south koreans. one thing that the president has to do now, i think, is mend his relationship with president moon of south korea. moon pushed the president hard. he's the one who met with kim jong un, said that they are ready to negotiate in good faith. the president believed that, sent mike pompeo to the north. so president moon of south korea is in a very tough spot right now, and he's got to decide whether to realign himself with the americans, put some distance between himself and the north koreans. >> he was in the white house on tuesday. >> yes, he was. >> did the president tell him what he was going to do, or did the president patiently listen for his don't cancel the summit -- stuart: we don't know that, do we? >> no, we don't.

we don't know when the decision was made. stuart: surely what the north koreans are looking at now is the imposition of very tough sanctions agreed to by the united nations. ashley: yes. stuart: which may well include sanctions by us on chinese banks which are doing business with north korea. that's an escalation are. >> it is. and it wouldn't surprise me if they did that because that's always been on the table, the possibility of sanctioning the chinese banks. the president and his team may be very upset with the chinese, the role heavy played in this right now. they're already upset with them about the trade negotiations. this is very high stakes when you get the chinese government and the north koreans, the whole pacific over there, the americans just this week said they were going to push back against some of what the chinese were doing in the south china sea. there is a lot in play right now, and i'm sure the market is just standing back trying to sort all this out. stuart: yes. implications for the future. >> it is just a heavy load. stuart: i don't see any way around an escalation in the --

that's a stupid word to use, escalation in the tension, it's always one of those banners you see along the bottom of the screen. [laughter] there's no way around it. this development implies an escalation in our approach towards north korea and maybe towards china as well. we're upping the ante to some degree. i don't see any way around that. that's the risk to the market. if the president escalates from here, i think the market takes a hit, a bigger hit than it's taken already. >> well, he doesn't necessarily have to do it with this statement, but we are status quo ante before negotiation discussions began which was putting maximum pressure on north korea. and i think he and his team are now going to spend perhaps the weekend deciding what exactly will be their next step, where will the pressure come from if kim is not willing to negotiate. stuart: i'd love to be a fly on wall of that room right behind in the background there, that's where the president will emerge momentarily, we believe. we've been waiting for about a

half hour now, but we expect him to emerge momentary hi. he will sign a banking bill, and then we hope, we suspect, we expect that he'll make some comment on north korea. >> and that it won't be frivolous, it'll be profoundly serious. stuart: i just can't see our president making funny remarks, frivolous remarks. he's got a sense of humor, but i don't think he'll be frivolous. ashley: he'll say the ball is in your court, pyongyang. we're still willing to talk but it's time to, you know, come to the table. and this met rick, to lizzie's point, it really blew up very quickly. and it took the u.s. as surprise because, as we know, they were planning, making preparations but were getting absolutely no response from the north koreans when they wanted to get to singapore, they wanted to look at the site, they really wanted to get this thing set up nicely all in preparation for june 12th. all of a sudden communications were cut off completely. stuart: i do want to go back to

nancy pelosi and, christy, if you can, will you line up that sound bite where we've got nancy pelosi addressing the end of the thing. i'm going to roll that tape in just a moment, and when we've done that, we'll come out and tell you what else she said about a giggle fit and a valentine. so we're just teeing up that tape as we speak. i'm going to roll it and then we'll have more from nancy pelosi. i think we're ready right now? yes. i've got to keep talking for a few -- they're doing this to me. [laughter] elizabeth: well, the game plan here is to get trump's approval ratings driven down to the 20% range so nancy and the democrats can seize back control of the house, and she can make history being named house speaker e again. stuart: that's the game plan. elizabeth: that's the game plan. stuart: what do i know? still stretching, ladies and gentlemen. we've got it, we've got it. roll tape. [laughter] >> this takes preparation, this

takes knowledge, this takes judgment. and, cheerily, it takes prep -- clearly, it takes preparation which the president didn't make. now he's walking away from it. stuart: the president didn't know what he was getting into. may i remind speaker pelosi that we sent our diplomats over there, had loads of contact to prepare for this. mike pompeo went twice to prepare for this. we got no response to the latest round of preparations, no response from the north koreans what whatsoever. and, in fact, nancy pelosi went further in more statements just released, and, judge, can you read it from your phone again? >> yes. stuart: find it. [laughter] >> i've got to find it. stuart: i can tell -- >> messages here from chad pergram who's our genius -- stuart: hold on a second, here is president trump. he's walking up to the podium. he's about to speak, and we are going to listen. the world will be listening and so will north korea. here we go.

>> thank you very much. i'd like to begin by saying that, based on the recent statement of north korea, i have decided to terminate the planned summit in singapore on june 12th. while many things can happen and a great opportunity lies ahead potentially, i believe that this is a tremendous setback for north korea and, indeed, a setback for the world. i've spoken to general mattis and the joint chiefs of staff and our military, which is by far the most powerful anywhere in the world that has been greatly enhancedded recently as you all know, is ready if necessary. likewise, i have spoken to south

korea and japan, and they are not only ready should foolish orb reckless acts be taken by north korea, but they are willing to shoulder much of the cost of any financial burden, any of the costs associated by the united states in operations if such an unfortunate situation is forced upon us. hopefully, positive things will be taking place with respect to the future of north korea. but if they don't, we are more ready than we have ever been before. north korea has the opportunity to end decades of poverty and oppression by following the path of denuke hardization -- denuclearization and joining the community of nations.

and i hope that kim jong un will ultimately do what is right not only for himself, but perhaps most importantly what's right for his people who are suffering greatly and needlessly. all of the korean people, north and south, deserve to be able to live together in harmony, prosperity and peace. that bright and beautiful future can only happen when the threat of nuclear weapons is removed. no way it can happen otherwise. if and when kim jong un chooses to engage in constructive dialogue and actions, i am waiting. in the meantime, our very strong

sanctions -- by far the strongest sanctions ever imposed -- and maximum pressure campaign will continue as it has been continuing. but no matter what happens and what we do, we will never, ever compromise the safety and security of the united states of america. i wanted to make that statement. i feel very, very strongly about it. our military, as you know, has been greatly enhanced. we'll soon be at a level that it's never been before. our approval of $700 billion this year and $716 billion next year, largely due to the help of a lot of the people with me today and standing right here, we

we had to do that for our military. we've done it. hopefully everything will work out well with north korea and, a lot of things can happen. including the fact that perhaps, and we'd wait, it's possible that the existing summit could take place or a summit at some later date. nobody should be anxious. we have to get it right. okay. with that being said, we have something else which i have to tell all of you chairman, mike, and everybody, it was a big deal until this came up. [laughter]. i don't know, where is mike crapo? mike, where are you? congratulations you did a great job but it doesn't seem so important now. but it is important and it is incredible and that you have done it and done it in a very bipartisan way, which is very nice. thank you very much.

very bipartisan way, mike. i want to congratulate you and everybody else. i will read a few names. this is a hard. it is all about the dodd-frank disaster, or fixed it, have gone a long way toward fixing it. mike crapo, thank you very much. steve daines, thank you, steve. incredible job. john kennedy thank you very much, john. heidi heitkamp, heidi, thank you very much, appreciate it. david perdue. where is david? oh, i love david. [laughter]. what a great guy he is. jim risch. jim, thank you. what a great lawyer. i learned all about you, one of the great lawyers. [laughter]. i think i have to use him. tim scott. tim, thank you, tim. great job. it's a great achievement. pat toomey, who really does know the financial world i can tell you from experience, right,