pauses they're in deep trouble. >> new reality. stuart: twitter is down 17, 18%. >> 18%. stuart: our time is regretly is up. i hope everyone has a wonderful weekend. we plan to. my time is up. i have three seconds. neil, it is yours. neil: stuart, thank you. look what we have going right now. we have the economy on fire. a lot of people saying, can we maintain that fire? we'll exploring that next couple hours here. bottom line you already know. the markets already expected this. maybe hoping for even better number. that is why they're kind of soft on this. never satisfied these guys, bottom line. deirdre bolton here to break it all down. what is happening, what it could portend for this economy. deirdre. >> neil, the headline, 4.1%. that is the second quarter. u.s. gdp. that is essentially all the goods and services that we are producing. this is the best level since 2014 in the third quarter. so there were two key

components, two reasons why this print is so strong. one is trade. the other is consumer spending. pull up trade first. we'll see that for the second quarter. so it rose better than 1%. so there you have that and a big part of that is because our net exports, so the goods and services we were selling overseas went up. that was a pretty big component. bigger of the two though is consumer spending. thisthis 2/3 of economic activi. consumer spending in the second quarter, is up 4%. this added one percentage point to the 4.1% headline print. one reason economists analysts are talking about this. because this second fiscal quarter was first quarter we saw trump tax cuts in effect. that $1.5 trillion tax plan, that was passed in december of '77, that really gave this is

huge, big boost. if you look historically, how this 4.1 figure, headline figure, compares, you can see, obviously where we're here and a lot higher. higher than previous ones. we had some way, way back in the obama administration, that muched this, surpassed it, see in recent times, this is clearly the standout. neal, as far as what this means going forward, what most economists read into it, listen the fed can take a look at this. consumer spending is strong. exports, the general economy is strong. print looks good. they continue with this idea of perhaps of lifting rates two more times this year. neil: whether it is and a anomaly or not, higher the number higher the average, right? >> yes. neil: whatever average will be helped by this deirdre, have a great weekend. meantime the president, you might be stunned to hear this calling historic proportions.

blake burman when it comes to other white house reporters is of historic proportions himself. blake, the administration taking a bow. >> thank you, neil. the president and administration, see this as vindication for the economic policies over the last 18 months since the president is in office. go back to deregular regulatory efforts and what is engulfing president and administration in economic front trade as well. when you look into the numbers, gdp was boosted 1% by exports that flowed out of this country. it is half a percentage point higher than what normally is attached to the export numbers. the president earlier today said that is something that really stood out to him. >> perhaps one of the biggest ones in the report, and it is a big one, is that the trade deficit, very dear to my heart, because we've been ripped off by the world, has dropped by more

than $50 billion. 52 billion to be exact. that's added, and adding one point to gdp. that's a tremendous drop. >> but some economists, neil, say part of that surge was front-running because everyone was expecting these tariffs to eventually take place and they have. larry kudlow was asked just a little while ago if this is essentially a one-off? >> i don't believe so and you know, how people work ahead of tariffs remains to be seen. my thinking is that is going to even out over time. look, we're making progress on fixing the broken world trading system. >> spoke to kudlow about this, neil, after the interview, within the last 30, 45 minutes or so and kudlow told me thinks that the new eu deal involves

more soybean purchases could make up for any sort of gap if there was potentially front running here, neil? neil: again there are no penalties if you buy soybeans in europe as it is. farmers do it on their own so how would any expanded deal or promise would make up what would be lost from china? >> we don't know exactly what the numbers are attached to soybean purchases. when you look at soybeans that least the united states, the top 10 countries of soybeans, two are in the european union. they buy relatively small amount to begin with. we don't know exactly how much more they will buy, whether substantial or fractional, or somewhere in between. neil: that is what is annoying about you, blake, you get into this nitty-gritty. never look at anything at face value. all of sudden, blake burman has an alert. don't get me started on soybeans. great job my friend as always. blake at the white house. one thing interesting in the president's discussions about this, trade deficit all of that.

it did help here. not so much talking about what is going on with the budget deficit. we'll explore that off and off here. go to market watchers, john layfield, gary b. smith and former white house visor austan goolsbee. this number is great second quarter number, it is hard to repeat. you guys found that out. george bush found that out. what is it about sustaining strong quarterly numbers, what's the problem? >> i don't know, this is a very good number. it follows on a first quarter of this year was a pretty mediocre number. when that came in and consumer spending grew less than 1% at an annual rate, a lot of people said it was from the weather. so if you get a down quarter from the weather or from something that is transitory a lot of times you get a rebound in the following quarter. vice versa. if you get a good quarter you get a rebound down. in a way that is the problem.

it is not really a problem of the it is just reflex shun there is lot of moving around. a numbers move around. some months you're up, some months you're down, you tend it average out over longer period. neil: if we average things out next two quarters, gary b. smith, the view we'll average out 3% growth for this economy in the year. that is a bit of a leap. i'm going on the assumption of a 3% third quarter pickup, 2.9% fourth quarter pickup, i think that is the consensus. what if that is how we ended the year? >> well if that how we ended the year it would be fantastic and i think more importantly, like we're seeing some earnings coming out. they're a reflection of what happened and people now start to listen the guidance going forward. i think the same way with the gdp. we get a 3% growth this year, i think we're going to get higher next year. remember, a lot of the tax cuts have not kicked in.

a lot of the regulation-cutting that trump has done has not yet kicked in. i think everyone on the panel would agree the great unknown is what happened with tariffs but even there, with what the trump has done with the eu, that, may end up being more positive than negative. i think the economy is in great shape on strong footing right now. neil: you know, john layfield, the markets have a shrugged reaction to this, maybe because they were expecting this, or actually maybe expecting whisper numbers added a lot higher. what is going on here? >> i think forecasting as gary b was talking about, the market expected low four range, they got exactly what perp expecting. we got a miss. if the it was higher, market would be up a little bit but not much they expected 4% range. good thing going inventories, 1.43 inventory sales to a year ago, now it is 1.35.

inventories are depleted. they have to be rebuilt. that is a good sign for gdp going forward. neil: austan, when you look at this, the president said tax cuts were a reason, a big chunk of that. do you think tax cuts lifted the economy? >> only modestly. i notice he didn't want to attribute the slow growth in the first quarter to the tax cuts. i think jury is still out. there is good news and bad news from that. most of the tax cut effect is still to come. so if you think that is going to be a big positive, that's still to come. it was sold as it is going to increase wages and increase capital investment. so far really haven't seen either of those come through. so i think we're still going to be hoping that we get that going forward. neil: you know, gary b., who am i to rain on the parade here. people will read political calculations here but i notice the president talking about the trade deficit again and again. never mentions budget deficit.

never mentioned he is overseeing back-to-back-to-back years could go over a trillion dollars in red ink. maybe we have just gotten used to it. he certainly made a bigger case running for president. ignores it as president. what do you make of that? >> neil, you just trying to rain on the parade. neil: yes, that is the way i roll. >> out there the big bogeyman. every president has said that, you know, when they're running for president, and they're going to solve it. it is so easy not to solve it. it will hit one day. it will hit hard. i often said, with you and on other shows, that, we're heading more toward becoming greece than you know singapore or a hong kong. i hope that's not the case. i hope we right the ship, especially with entitlements. but for now i will take the good news that we have. neil: so will i. i don't want to be a naysayer

here. i always say that, austan going back to the obama days, i said the same thing. john, i am worried about a president fixated on trade deficits. that in the scheme of things versus our overall budget deficits, no pun intended, you know, trump change if you will, even chump change. if he is not worried about that and he is talking about the growth from tax cuts, maybe that will materialize in more dramatic fashion, make that takes care of that, what do you make of that? >> i think it is incredibly disappointing, proves he is politician. i hate to say that. i'm rooting the economy and tax cuts. i think my good friend austan i think is wrong. corporate earnings, 35, 40% of growth attributed to the earnings growth the wage growth has not fixed that.

if you take a trillion dollars out of government spending you will hurt it significantly. whoever is the politician in charge probably will not get reelected. that is why nobody does it. disappointed these guys don't have vision for 20 years out. only vision for next election cycle. there is no fiscal responsibility in d.c. neil: on that happy note, i want to thank you guys very much. dow is up 20 points. backdrop for all this, is much better-than-expected earnings are we're getting out of corporate america. a third of the way through the process where most of the companies reporting beat estimates. i say most, when it comes to technology land. amazon is a little different. that is a different case study how to beat the street when most think they will beat technology stocks. but when you think of facebook, think of twitter, think about the new methods we use now to sort of handicap their success, it is not what they're earning. not their revenues. it is all in their new subscribers. that is what is worrying a lot of folks who follow these stocks because that momentum is

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neil: cvs shares down on 6% a report out of new yorkwer, about to publish a article by ronan

farrow, allegations of sexual misconduct of les moonves. cbs said they are committed to violating claims of violation of their policies. timing of this report comes in midst of company's very public legal dispute, back and forth with the company there. charges among other things, moonves, 68 years old, married cbs personality julie chen 2004 had number of affairs and otherwise escalated with number of other women at the company. i don't want to get into all the sordid details but it is testing the metal of the stock. investors want to know more what is going on from mr. moonves himself. no direct response as yet. of course, this is the same network had problems with charlie rose and similar allegations. happened a lot of other places. allegations came up at this

place as well. we'll keep you posted. cbs shares down better than $3 a share. taking a look at facebook, linking what is going on with twitter. common theme seems to be disappointment not necessarily earnings and revenues, but how many people are using it. amazon with a big clash there. that is separate issue, making money hand over fist. they saved the technology day here. what is interesting about facebook. what is interesting about twitter, they're suffering based on earnings or revenues per se, how many people signing up to use the service. that is whole new metric to judge worth and value of high-flyers that may be high-flyers again. market watch's jeremy owens. jeremy, that is new dynamic. for those two issues specifically, right? twitter and facebook, it has been their death knell. what is going on? >> yeah, twitter, facebook have been judged by how many people are on the platform.

similar, how you, neil, get judged by your viewership. we're kind of looking at that. it's a little bit different for facebook than twitter. facebook guided to lesser revenue growth and lesser profit margins. they're actually showing, there will be effects what is happening from facebook. twitter is getting rid of accounts that they considered to be spam and bots. that could hurt that. they are showing better revenue and especially better profit. they are showing better profitability. if they continue to leverage users they have in better way and this could be a short term thing for twitter, for facebook that will be something we have to watch for a long time coming. we expected since 2016 this growth, this fantastic growth will have to slow down at some point and it hasn't. now we're seeing indicators maybe it will for big tech names. neil: what do you do? how do you judge it? do we look for things as simple as just raw earnings, which are

making more revenues? you know, or is this becoming a different dynamic? >> it has become a little bit of a different dynamic. eventually the companies will mature. revenue growth will slow down and find a level of profit margin seems to be steady. we haven't got enthere yet. don't know what the companies are able to do financially and don't know if we can equivocally say it this will be how it is going forward. this is what it looks like right now. that is definitely something facebook is dealing with. saying what it looks like in near future. long term anybody's guess they will be able to come through this but they do have potential, right? neil: yeah. >> beyond facebook they own instagram, they own two messaging apps with more than a billion people on them. neil: sorry, jeremy. i'm surprised that facebook has not been able to absorb the

blows as much given instagram holdings, that it fell to the degree it did and continues to as we speak. that that would have provided a buffer of sorts. so i kind of is that a unique case, but what do you make of that. >> yes they lost $120 billion of market cap, whatever, they are still worth more than half a trillion dollars. neil: you're right. >> talking about a website we signed up to play farmville or see our cousin's baby pictures lost $100 billion. if you look at it long term it is 5-x since the ipo, still worth a good bit of money, still top 10 in terms of market cap. you know, yeah, short term there will be changes there but if you look at it long term it is still doing great. neil: always good having you. always great to have you. jeremy owens, market watch tech

editor. look at what is happening with cbs's stock careening better than 6%, on reports that ceo les moonves is accused of sexual misconduct. with a ronan farrow expose' coming out shortly, "the hollywood reporter" reporting as well. this was a wide spread problem sexual behavior, unwanted touching and kissing, occurred more than 20 years ago. the effect vivid and real today. more after this. is complete! instant purchase notifications from capital one . technology this helpful... could make history. what's in your wallet? you shouldn't be rushed into booking a hotel. with expedia's add-on advantage, booking a flight unlocks discounts on select hotels until the day you leave for your trip. add-on advantage. only when you book with expedia.

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♪ neil: all right big issues coming together for the midterms, aren't they? 4.1% economic growth and maybe one of the best years for growth we've seen in quite some time. then there is that whole russia investigation and where it is all going. get the read from swan street strategies's partner erica

mcpike. we can just cover the markets, in other words, we can look at how they are betting with their money, actually our money, what's going to happen. and for the most part, they have weathered the trade storm, they have weathered the allegations of michael cohen tapes, payments to models, et cetera. just fine. with the belief that underlying backdrop is very good. the markets today, notwithstanding. you know the drill. the economy, that's going to be the wind at their back and republicans back. i should stress, this is a largely republican bastion. what do you think of that? >> neil, that's right, sometimes you have to look under the hood of the car. i would remind the economy was doing pretty well in 2014. markets were up. what happened that year? the democrats had a bad year at polls in 2014 midterms. lost

neil: dent remind me of facts that get in way of my own but you're right. what got in the way then? >> health care. republicans, they were still campaigning against a democratic president, even though he was not on the ballot. you have the same thing, the same issues in this cycle. look, i think republicans have a lot of things to contend with. not just russia, not just the corruption issues that are going on at some levels of the trump administration. but, you have got the same thing happening with some of the republican leadership like jim jordan and i think when we get past labor day, you are going to see democrats message in a bigger, broader way, a more broad scale way about culture of chaos and corruption sort of thing in 2006. i think you're going to see democrats win on the issues. even though the economy is doing well for some and market is doing well, it is not doing well for all. we still do have the skills gap. look, i don't think democratic leadership is addressing that so well. but there are some younger democrats who are eager, coming

up, who do want to dig into some of these issues. you're seeing democrats like seth moulton and tim ryan going back at issues. you will see a better message coming forward from some democrats later this fall. neil: i don't doubt democrats will pick up seats in the house. i don't think they will get control of the house. they could actually lose a couple senate seats. but that is there as well. i think they're troubled by their own, i don't know their own conscience what they want to be as party. far left. just moderates, who have been told, don't go too extreme, shutting down i.c.e., seven out of 10 americans polled like i.c.e. they risk grabbing defeat from the jaws of victory. pubs have done that too. i'm wondering how that plays out this argument what they want to be as a party? by the way republicans dealing

with that in a way. saw that in living color, paul ryan and conservative wing of his party going after rod rosenstein. very pronounced with democrats, but i think it will be a bigger issue. what do you think? >> it may be but may not be as big of a issue as we think. a lot of democrats are trying to figure out whether the democratic party should be a big tent party or focus on a few things. democrats believe bernie sanders has taken things too far and a few democrat senators are away from most of the democrats, medicare for all issue, not every democrat thinks the same kind of coverage for bernie sanders is calling for is the right thing. maybe a public option is the way to go. but i don't think you're wrong thinking democrats are going to have a bit of a struggle trying to figure out exactly where to go. abolish i.c.e. thing as you and

i talked about, that is not the thing to be campaigning on right now. i think that is a huge mistake. huge mistake. it's a law enforcement agency. we need law enforcement. neil: but, again, they can overplay the hand. first time, first year, first party where that happened. we'll see how it sorts out. have a great weekend. >> you too. neil: who is under soing alarm over trade? not democrats but republicans increasingly concerned that the president is botching it with something that could be a winning issue after this. and exercise. and maybe even, unproven fish oil supplements. not all omega-3s are clinically proven or the same. discover prescription omega-3 vascepa. the one that's this pure... and fda approved. look. vascepa looks different... because it is different. it's pure epa. vascepa, along with diet,

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♪ ♪ our new, hot, fresh breakfast will get you the readiest. (buzzer sound) holiday inn express. be the readiest. ♪ neil: the president calling on tariffs the greatest. they can be very beneficial. he told a crowd today he thinks it will all work out. you were worried. are you still? >> no, i'm still very concerned about the trade situation. it is the most consistent concern i hear from the texas business community.

neil: you think he is getting nervous? >> i'm not so sure that it is getting nervous as i hope the predone dance of the -- proupon dance of the message we're sending, our or constituents, his supporters are getting through. we get it, we all want the same thing which is fair trade deals. we know we don't have the greatest trade deals in the world but right now retaliation is actually impacting us today. neil: the president is committed to $12 billion to help farmers adversely affected by even the talk, threat of tariffs. do you think that was a good idea? >> i'm supportive of it. remember the goal is to get better agreements, better trade agreements, get them in place as quick as we can. neil: to a man there, i talked to a lot of female republican senator as well, there is great concern what the president is doing on trade. not so much they challenge him directly on that. they hope cooler heads prevail, that they don't have to call him

on the carpet and vote on tariff moves he is making. if this keeps going the way he is going, they could be inclined to do so, hoping he can get a handle on this jeff flock at cme. we're getting a read how prices are adjusting. hey, jeff. reporter: i was down state yesterday, neil, talking to farmers, it is possible to like the president but think he is absolutely wrong on trade. if you're a farmer, that is probably what you think. look at soybeans. the positive stuff out of the e.u. meeting, no tariffs, farmers love no tariffs, because they think they can compete with everybody if they don't have tariffs but soybeans, since the whole tariff mess, look at a three month chart. that is not pretty. why are politicians reacting, they're hearing from constituents. here is the impact. go back to march, before the whole trade mess started, in terms of tariffs. 10.6for bushel of soybeans.

today almost two dollars left, 869. that means you're losing two dollars a bushel. you grow 50 bushels an acre. grow more if you're better farmer, better ground. average farm, 500-acre soybean farm, that is a loss of $50,000. more importantly break even of soybean farmer, $10 a bushel, everything is different depending where you are. they're under break even. the $12 billion helps, these farmers remember back to president nixon who embargoed grain shipments. president carter embargoed to russia, that all killed market share. it took them a long time to get the market share back. if you get the deal worked out sooner rather than later, that's good. if not, it could have long-term impact. neil: yeah, already is. thank you very much, my friend, jeff flock in chicago. a new poll showing a third of the midwest battleground voters

say the president deserves to be reelected. maybe these factors come into play. former chief of staff to paul ryan, david pohhe. look i ironically, the might have made the gdp number better, a lot of people getting stuff out to customers, particularly chinese in case of soybeans and agricultural goods before the hammer came down, but by and large it can be a problem, right? >> it can be a problem. neil what we're facing right now, is the president is trying to use leverage here with, with tariffs. so far with europe, it seems to have had effect. there are downside effects which farmers are already seeing. this is the danger with tariffs. this is the danger with a trade war. is that you don't know if it will be a snowball that stops rolling down the mountain or the avalanche that starts and we still don't know the answer to

that. we have farmers who while they like the president are very concerned because to live week to week, month to month. if prices stay low, living week to week, month to month, it is harder because they're losing more money. if they're hopeful the president will win this but they're not sure themselves if the trade war will work. neil: the president lost all the states where he is having a tough time in the polls, he would not get reelected, assuming all the others he won he would win again, if you loses three states, wisconsin, minnesota, he would be in deep trouble. do you buy that? >> you know what? i think we should have learned from the 2016 presidential election that we can not put that much credence on polls. neil: you're right about that. >> i assign that same kind of sentiment to this particular poll as well which looked at only less than 1000 registered voters. instead, true, i think some people in our country, if

president trump walked on water, they would criticize him for not being able to swim. then you have the rest of america, i believe that the choices are very clear, when you're looking at the democratic party versus the party of president trump. democratic party has no sustainable, economic, viable strategy other than russia, rush share, you don't think there is some frustration there, not might be to the extreme they would say oh, the heck with you, mr. president. >> of course there is. neil: are they concerned tariff thing will come back to bite them. >> of course there is. if not now when? we're the most powerful country in the world. time we start acting like the most powerful country in the world. when will be the good time sit our allies, a little bit of both, our competitors and our competition to be able to sit down, say to them, listen we need to renegotiate this thing? we charge you 2.5% to bring your automobiles here, you're charging us 10%.

the second world war is over. these countries are viable, able to stand on their own two feet. my question to the american population, if not now when? do we continue to allow ourselves taken advantage of? we say enough is enough. get back to the table while we have leverage to do so. neil: that is the argument for this, david, what do you think of that? >> if you look at the opening larry kudlow and ambassador grenell and president talked about in automobiles to europe the germans seem to be interested in talking about this. we should look at the opportunity getting rid of all barriers to trade and automobiles in europe. that would be a great step forward. good to see president looking at that. that is in his mind. mr. kudlow and ambassador grenell had a great effect. the president wants to find, yes some treaties can be better negotiated than they were. we haven't had perfection. you have to be careful how you go about it. the strategy may be very

different, we need to look to combine with some of our allies against the chinese who are doing things like taking, stealing ip or forcing companies to give over some of their, some of their intellectual property, in terms of, if they want to get, if they want to trade with them or want to establish a factory over there. we have to be stronger and rest of the world has to go into the wto, say, chinese have to be treated as a developed nation in the wto. this has to change. it has to change now. >> i agree completely. neil: oh good. i thought we would have differences. that is the way i roll, guys. avoid disharmony. have a good weekend. dow hitting session lows. close to it. down 86 points. sectiontech stocks are big disappointment. facebook had earlier tepid gain and twitter adding to it. subscribership running down or pace of increase slowing down a

lot. that had an effect on technology, particularly some big names in technology as it spreads far and wide. still early. we still have another few hours to go here. i don't want to overemphasize the minute. keeping track of cbs shares falling, that leslie moonves is being accused of sexual misconduct. according to ronan farrow report in the new yorker, dating back to two decades. the selloff is alive and well. after this. a scratch so small you coulda fixed it with a pen. maybe you should take that pen and use it to sign up with a different insurance company. for drivers with accident forgiveness liberty mutual won't raise their rates because of their first accident. liberty mutual insurance. ♪ liberty. liberty. liberty. liberty ♪

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♪ neil: the gdp or gee, is there another tape out? there is challenge in the media. i try not to challenge it one way or the other. i think we have too many to cover both. i do three hours a day between this fine network and fox news. we have three 24 business networks. we have three 24 hour news networks. we can try to get in all of this without showing one preference one story or the other. maybe the justified fixation on this michael cohen tape with donald trump talking about payoffs, playboy models that gets to some attention but the degree it fronts out everything else, it makes you wonder is

that remotely fair or balanced or just looking at one side of the equation? media research center, research director rich noise is here. you don't have to have a horse in this race to say that ain't exactly fair and balances. what is going on here? >> no. the media haven't been fair and balanced in years but the trump era has put that into sort of hyperdrive. if you asked people in polls what they care about, the economy is usually number one or number two. russia, insider scandal stories are usually way down. the michael cohen case does not affect people's lives the economy does. that is where the presidents usually rise and fall in the long term. i will say the president giving a televised speech about the economy was very smart. nbc actually broke into programing, gave that half hour of airtime. that is a good way to get his message out through the media

prism. on cable news it went back to their michael cohen fetish, they will stick with until the next one. neil: i think he can do both. i understand the importance of the story at the moment. as we were discussing last week, with performance on vladmir putin. not exactly a-moment, a backdrop of economy, backdrop of everything else going on there is enough time to get everything out there. it doesn't have to be all or nothing. it can be everything. we don't see a lot of that i can start picking apart network newscasts but they don't have a heck of a lot of time, when i see news channels going that way or 24 hour business networks going that way, regardless what you think about the president or party fell ages, it gets screwy. >> the question is what are they trying to do? are they trying to analyze what is going on in the political world. from analytic perspective, big gdp numbers, europe coming his

way on trade, those are strong, powerful things that -- neil: we don't know if you're definitely coming his way on trade. we don't get all the details, but i do know what you're talking about. i have another crackpot theory, rich, i want to bounce this off you. i'm a nerd here at fox, that might shock but i'm fascinated with economic stories, financial stories, that kind of stuff, and i don't think many of my colleagues are. they will report, i'm not saying they're loathe to even discuss them but it is not their cup of tea. i'm wondering if that plays into it, boredom about the stuff that is our lifeblood? what do you make of that? >> well, maybe. i mean i do think the the soap opera taken over everything else presidents re-election, ronald reagan and bill clinton had strong economies.

president bush, and others had weak economy too strong to overcome. if you want to cover politics, you got to pay some attention to that. if you want to drive the narrative in your direction, then you go through and do this 90% negative, hammering on scandals and not giving anything else any oxygen because you're trying to manipulate politics, not cover it. neil: it is interesting. it isn't always the economy though, right? maybe depends who is at ballot or not on the ballot. i was reminded by erin mcpike, swan street strategies partner was telling me the economy was doing just awesome in 2014, yet democrats lost a lot of seats that year. of course, barack obama was not on the ballot. it was midterm year but it is a reminder other issues, i guess in that case, the health care issues and problems and questions, that did. so knowing that, and the backdrop now, what do you think will decide the november races?

>> well, that, we have to be something big. if there is true developments in the russia story that could affect things. if there is some kind of a war and peace issue comes out of nowhere and becomes positive or negative story, that would really affect things but right now what we've seen is a slow, creep up in the president's approval ratings from 40% on "real clear politics" average in january to 43% now. that is in the face of this tidal wave of negative coverage. so if, that seems to be the economy in play. seems people feeling better about their own jobs and their own personal security. if that is the still, the same trend, there will be a lot of fireworks, there will be a lot of back and forth. but you know, still seems to be decent environment for republicans and this president, again unless something dramatic changes. neil: thank you, my friend. always good seeing you. >> thanks. neil: all i'm saying on this stuff, i think rich's point is very sound one. you can cover it all.

don't have to be biased. talking about a report slighted at white house -- legitimate story, talking about what is going on, vladmir putin, how the president performed, very legitimate story. all this other stuff, on, recorded conversations and maybe overstepped his bounds. could be legitimate story. what is happening with the economy. what is happening with the trade battle back and forth. let story. cover them all. have at them all. don't pick and choose. meantime the dow, no way to pick and choose this. session lows. nasdaq down 1 1/2%. a lot of concern not just facebook. a lot of concerns maybe the whole group taking us through this party, is pooping out on the party. nicole petallides at new york stock exchange with more of that. what is going on? >> neil, walked into the trading booths, what is going on, why are we seeing accelerated selling? jeff frankel says i love the

u.s. buying equities. nowhere else to put your money. forget about treasurys abroad. he is dell heavy investor here in the states. that is where it is. we've seen volatility this week. people are buying and selling throughout the week even during the day. volume on earnings. he noticed just now, what happened? he said at 10:30 we started to roll over. people started getting out of tech. me too. i have not been piling into the tech lately because now he is taking profits. maybe he will buy them back again. but as people are selling this particular group. so you see names like intel and western digital are to the downside. intel had their numbers on the quarter, didn't have, actually chipmaker data segment center grew less than expected. the ceo looking for third wave of proposed china tariffs according to one report. those things are weighing. that is big move for intel. western digital, concerning the

electronic arts game-makers. people love the game-makers. this is one group people are loving. egaming is very hot. talk to joe at wedbush all the time. this group is a hot. today they had a revenue miss going forward. facebook, forget about facebook. worst drop ever in percentage, worst drop in total market cap. neil: covering a lost ground. nicole petallides, technology is leading that. even though economy is chugging along, maybe it won't be concerned with a lot of that stuff happening. more after this. ♪ .

. neil: all right. the economy on fire or looking more fired up? have you heard we're up 4.1% growth here. the people averaging the year 3% better growth, haven't seen that in a lot of years. chairman of economic council advisers kevin hassett is with us. great to have you. >> thank you, great to be here. neil: this was greeted with some disappointment oddly enough for some binding with numbers, it was going to be a lot higher. were you surprised? happy? what? >> we're very, very happy, the president delivered policies at 3% growth and look at 4. at the cea we put out a

forecast that it would be 3.1. the time we naut out last year there was a lot of criticism from the left this 3% is impossible. if you average the first two quarters, 3.1. you thought people said we would see 5% growth or something. one of the nuances in the data that is striking and favorable for the second half of the year is the inventory subtracted about a whole percentage point from the gdp number. instead of producers being able to keep up with consumer demand and increase production as the surge in demand for products occurred. they had to run down inventories, and historically when that happens, they have to jack up production in the second half of the year to rebuild stocks. it's about as positive as a report as you're going to get because you have sustained growth. neil: thank you for explaining the inventory. we got on the nielsens with that puppy. >> yeah, yeah, come on, neil. neil: you talked about a legitimate issue that economists have been debating

that maybe it does set the stage for stronger, at least than expected growth in the second half of year. >> it absolutely does. so again, we said it would be 3.1%, the first half averaged exactly 3.1. spooky when models work that well. we have a lot more momentum in the second half than we anticipated. i expect the next time we write down the forecast for the rest of the year, it will go up a couple of tenth. enormous amount of momentum. net exports contributed positively to gdp growth in the second quarter. neil: what did you think that was about? a lot of it was exports, agricultural products and a lot of people could have been just trying to get the deal done and the shipments out before these tariffs came in effect. so in a weird way, the president's hard line on trade boosted that number. >> it boosted those sales, and i think that there are two factors. one is what you said, so we've looked at data, private data on

inventories and see that, for example, the chinese increased inventories of soybeans a lot perhaps in anticipation of trade dispute. also there's a lot of reshoring of activity, the u.s. is an attractive tax climate again. we see that in the data as well. >> you know, i noticed that the president, of course, and you mentioned and comments at the white house today about what's happening on the trade run and the trade deficit did dip a little bit in the latest period. but the fact of the matter is year-over-year it's worse than it was, but still a fraction, if you think about it, concerning the budget deficit. president never mentions the budget deficit. looking at a trillion dollars one next year, does he care about it? talk to you about it? >> he does. i disagree he doesn't mention it. when you saw the spending deal, he was pleased to see the military spending he wanted but is concerned there is too much other spending. neil: he still signed it. he still signed it. >> well, i think it was because

really there was such a problem with the military spending, fallen so far behind under president obama that he had a lot of catching up to do. i would guess in the next budget negotiation we have to draw a harder line with spending. >> draw it with republicans, they're the ones spending like drunk sailors, right? >> the president has to sign it. neil: yeah. let me get a sense from you what you're going to do to address that. a lot of democrats seized on the tax cuts, the reason why it got worse, they ignored the fact and you mentioned in the past that there's a lot of spending that went into that, that no one bemoaned, 10, $11 trillion over the next decade. leaving that aside, though, republicans have the reputation for being the party of austerity, watching this stuff. going into the midterms, you know, advocating, you know, nothing of the sort. >> well, you know, if you look at president's budget, a heck of a lot more spending restraint than you saw in the budget deal this year. you know.

neil: spending restraint, wait, wait, looking at the trillion dollars more in spending than the money coming in. >> you are right. you're exactly right. but ahead of the spending like drunken sailors congress that you mentioned, there's restraint and there's definitely going to be more coming forward in the future. >> are you worried that a backup in interest rates is still in the offing and maybe this great report today, chairman -- there we went. >> it was a great question. neil: the president unplugged the camera. you're back with us and i'm happy to see you. i'm neil, great to see you. >> good to be back. neil: chairman, i was asking about the uptick in rates boosted in large part by the very good gdp report that good news could be working against you, keeps the federal reserve hiking rates. the president is not a fan of that. what do you think of that? >> i respect the independence of the fed and the people of the fed will do what they think is right. neil: would you agree with the

president, that it seems to exasperate him? >> i think that at a time of high economic growth, what you want to do is see is the growth coming because of a surge in demand or supply? if it's coming from a surge in demand, that can be inflationary and put excess pressure on the fed. what we see right now is capital spending boom that increases supply and doesn't put a lot of upward pressure on prices. i expect the fed will do whatever is right but i think i'm encouraged by the fact we have high growth and high capital spending. that means we're getting a supply-driven surge. neil: chairman, we talked about the deal with the europeans, i'll be darned if i can get the specifics on that. i know they're committed to buying more soybeans and natural gas, when we get the ability to get it out of facilities and get to the europeans and what have you. do we have hard numbers to go on and what commitments they're talking about here? >> absolutely, a lot of discussions behind the scene and acceptance we need to move

towards a zero zero equilibrium, no tariffs, no nontariff barriers, those conversations will be ongoing, but we're very, very pleased with the progress we made. neil: when you say we're pleased with the progress, we don't have a deal yet, though? >> i'm just an economist, not a trade negotiator. the deals take a while to negotiate, they let the lawyers in the room. >> i understand that, sir, but we had a similar promise in commitment in april with the chinese, and that went like one of my diet commitments, it just went away. i'm wondering will this one go away and teeth in it. >> there are teeth and a deal the president personally negotiated with juncker. neil: what did he negotiate? how many more soybeans? how many more liquid or natural gas contracts are they committed to buying? >> that is something you should ask ambassador lighthizer on the show to explain.

neil: no one has given particulars, right? >> i think there are more particulars than are public. neil: finally your sense, i know you don't like to focus on the markets. the president will talk about the markets. there is concern the technology run-up, this is outside your purview, and i grant that, might be running out of steam, the money and commitments to keep this going just might be there. people getting tired, running out of energy? do you worry about that, that could show up in the stuff that you police? >> absolutely right. ebbs and flows in markets. if you look at five-year or ten-year horizon, you advise and investors look, smoothing through the ups and downs, are we growing 3% or 2%? if we're growing 3%, there is so much earnings growth you don't worry about the disruptionses you see on a firm by firm basis right now. absolutely the market can get ahead of itself, if you get the growth we think we're seeing then the economy will catch up. neil: kevin hassett, a real

pleasure, thank you for taking the time. >> thank you. neil: kevin hassett, the council of economic advisers, the chairman there. with me the "wall street journal" editorial board member bill mcgurn and lizzie mcdonald. what do you think? >> great points about spending. let me back up, i thought the gdp number was great but underwhelming because they were looking at 4.2. we have the showdown in september, and the fear is that interest costs on the debt is going to outstrip the military budget, that's never good, and we're going to see horse trading coming up. this is news that's going to be coming across in a month or so, that the spending will stay high. we'll see a trillion dollars and what the republicans are going to try to do is say yes, chuck schumer, we'll give you your spending, so long as you let us defund sanctuary cities. you're going to see -- correct. still pork barrel spending

going on. horse trading with our money with the deficit. neil: bill, i want to go beyond our excellent pedigree with the "wall street journal" editorial board but as a former speechwriter for president bush. >> right. neil: now i'm thinking talking to kevin hassett, he has a message to get out. doing the right thing, the trend is our friend. i understand. that when you were working with president bush, doing this all the time, working around the clock. how cognizant are you aware of that of setting the tone or setting the idea we're on the right track, trust us on trade, trust us on trade. >> the purchase of a speechwriter is to communicate. what you have to do also is taking what does an abstract number like 4.1% mean to the average joe? a lot of them think that's something for hedge fund managers. but i think the president was talking about for each percentage point roughly was 10

million jobs. neil: 3 trillion. is that right? >> sounds optimistic. i think it's over a decade, i'm not sure. go ahead. neil: and by the way, democrat or republican, when they assign that to a move -- >> well, you can't -- whether the specific numbers are correct. put it this way, i would rather have the problems we have with a 4.1% conversation than what we had with -- we grew from 2000 to 2015, we grew 1.7%. the average from 1950 to 2,000 was 3.5. growth solves problems. neil: revenue presumably watching dealing with the problems that you have, but the raft against this one, it's early to your point, it's not materialized. >> i disagree with that. that sounds like nancy pelosi's crumbs argument on the bonuses. neil: that's a very low blow. i don't know why you did that. [laughter] >> if -- you know, if you ask

people, i think it's clear the animal spirits, jobs, this is -- what i think of it is what does it mean in human terms for someone looking for a job. neil: i agree with you. it's going to mean more money coming in. washington can cure a lot of our problems. >> oh, i don't mean it that way. i wish less money to go in. lot of things go away if there is growth and opportunity and kids get jobs, that sort of stuff. >> it's interestingly, you talk about the 1.7% growth. bankers saying they were joking, the government does create jobs, creating jobs in compliance, whole new bureaucracies in health care, and reminded me i think it was a xerox commercial, the guy haplessly sitting between machines going like this. that's what it felt like the last few years, you are right about multigenerational highs and small businesses, i think it's good to feel 4.1% again.

neil: how do you know it's sustained? we had this uptick in one obama quarter. >> a number of 4%, and we've had 3% under obama. it has been the norm since world war ii up through the last prior years. >> up to the last year, 2.8, i think? we don't know. neil: it is tough. >> it is tough and it requires not rest wearing we are by tackling spending. i think deregulation has been a big part. that's hard to measure. neil: does the trade stuff get in the way? >> unfortunately from my point of view, i think the good economy gives the president room to do some stuff with tariffs because the growth is so high that might be more damaging when president bush did the steel tariffs in 2002, much worse economy. it was much more obvious. neil: that was your idea. >> i wasn't there yet. but if i were -- [laughter].

we don't really have the tariffs full on right now, and the president if he sees that market going down, that's a trump card, pun intended. because yank it. call it a victory. whatever he has at this moment, right? neil: something is going to be different than what we had. something is better than nothing. that's what we can fall back on. congratulations, you added to the sell-off. we're down 131 points, a lot of it is driven by technology, weakness there. what's fascinating what's going on in the technology, twitter is the latest example after facebook, it's not earnings and sales, customer use, signing up new users, they're getting more of them, just not getting as many as wall street thought and they're punishing them mercilessly. after this. ♪ a hotel can make or break a trip. and at expedia, we don't think you should be rushed into booking one.

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. neil: real quickly as this tech sell-off builds up, charles payne reminded me of michigan consumer sentiment number might have been rattling investors today. not the overall number which came in better than expected, 97.9 was the worry. it was something tucked in about the trade tariffs and where they're going, and that quoting from the university of michigan that consumers kept confidence levels at high levels, though consumers are building concerns about

tariffs, greatly accelerated in this latest survey across all households. 35% spontaneously mentioned that the tariffs have a negative impact on the economy, that is up 21% from june. 15% in may. thank you to charles payne for passing that along to me. he's smart. to susan li what's going on with tech. what's happening? >> good way to put it. disappointing earnings from twitter and intel, i'll tell you more about twitter, this follows on facebook, of course, a big erosion of market cap this week. stunning loss, the biggest in u.s. corporate history, losing $120 billion in just one session, that slammed mark zuckerberg by $14 billion. he'll be just fine. facebook not recovering today. we saw a higher shall we say opening on friday but declines being sold down, another 2% today. facebook some say trading cheaply, 16% at a discount to

the google price, we're looking at 21 p/e forward earnings if you strip out cash. is it enough to get people to buy facebook once again. given that guidance for declines and revenue for the rest of this year? i think the answer according to the stock market is no. let's talk about twitter. we saw facebook slide close to 20%, today is twitter's day, down 19%, close to worst day on track for worst day since october of 2016. this goes back to bad earnings and loss of users. sound familiar? yeah, twitter said number of monthly users dropped because they had to purge the fake accounts. in fact they lost 3 million average users from may to june, and they actually expect monthly active users to continue dropping in the third quarter by mid to high single digits. twitter shares following today. finish it off on a positive note because amazon, boy, oh,

boy, blockbuster numbers after the bell. almost doubling profit estimates by the market and guiding 100% above what analysts expect the rest of this year and everything is working for amazon, yes, retail, according to estimate, they get half of every dollar spent online, and then we have cloud coming in ahead with revenue in the quarter as well, and then the advertising business all of a sudden, they're an ad giant competing with facebook and google. they're doing a lot. back to you. >> susan, thank you very much. amazon, that was a weekly chart, up substantially today. a little bit over five bucks. that will ease the anxieties for the rest of the tech world? let's go to fortune executive editor, what do you think? >> it will ease the anxieties for amazon, not for anybody else. certainly not for facebook and certainly not for twitter. right now what you're seeing is amazon simply has a vastly superior business to facebook

and twitter because it's a much more diversified business and a business that is not only firing on all cylinders, neil, but in a surprising way. they're not making money what we think of as amazon, they're making money as susan said offering services like cloud computing, advertising services, the prime delivery services. it's really an incredible story. neil: so i was looking at, that that's why i was perplexed, for a while the issue was up better than 30 bucks and now a lot less than that. is it getting caught up in the tech draft, and a far more successful story, that that group is being hurt by the sins of a couple. >> well, and that happens. the interesting thing to me about both twitter and facebook's reports is that by normal company standards, they weren't terrible. these are companies that -- facebook is making a lot of money and growing quickly. twitter is growing quickly,

very, very high revenue growth, but investors found something to disliken them. that's what's going to happen with these kinds of companies. the investors are looking for everything and then they award them very high valuations. so when they don't get everything, the valuations go down. with amazon, they got everything and more. but, yes, as you know, they do trade in groups. neil: you know, adam, i know there are different ways to monitor how these issues do. i know it's a different case with twitter, different case with facebook, but the focus is how many new users they're getting or how many active users they're getting and how long they're on, et cetera. is that a worry with either, both? what do you think? >> it's a big worry because that's what investors are focused on. there's an analogy to amazon ten years ago when they didn't make much money, their fans said but look at potential. they have so many users and growing the users quickly and

that came true, the bulls were right, the bears were wrong. well, the bulls and the bears on facebook and twitter say if they can keep user growth up, they're going to continue to be great investments, but if they can't, forget about it, that's what's happening today and yesterday with those two is that there isn't a lot of faith right now in their user growth. there isn't any faith in twitter for their user growth, outside of one person we know yell. neil: and he was bashing him. any trade issues for these issues? >> not really, in the sense that amazon has been sort of hopeless in china, facebook and twitter have absolutely nothing in china. they have good businesses in europe and that situation is getting a little better. so -- by the way, i think we talked about this before. this is why they've been doing so well or one of the reasons they've been doing so well over the past few months, neil. there is no big impact from aluminum and steel tariffs on

these companies. neil: there is that, thank you my friend, always good seeing you. >> thank you. neil: talking about the president and the president touting the trade deal with the european union. to illustrate the point. anything is better than what we've had. any improvement is a sign of promising developments. but as i mentioned with the council of economic advisers chairman, i don't have the details. i don't have the hard, raw data, and that could be something markets are weighing. what did we get? after this.

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. neil: the old adage improving economy gives you improving markets, improves markets give you an improving economy. you run a bit of a different beast that can be a reflection of the inflationary environment too, and the commodities and the appetite of all sorts. how do you look that the? >> there's a lot of people

because margins are very, very thin need to manage the risk of those products and that's what we're seeing here, so whether that's a barometer for which way the economy is going we don't know. people don't trust up or down so need to mitigate the risk. neil: chairman of the cme and investors need to hedge bets in commodities, after stocks are run up, some vice versa. let's go to jack otter on developments. jack, what is an investor to do in an environment, i'm looking at commodities, how they could be affected by a trade war, also playing the soybean thing, think of the stock thing, what do you tell them? >> starting with commodities, a reason to be bullish on commodities. if you look at long to midterm charges, it's been awful. in the short-term, a bit of a rally, that can continue often toward the end of an economic cycle. one of the last great bull runs, are commodities and the

tariffs will help those, and it's a nice hedge. if the gms and the boeings and the deltas are hurt because of steel prices going up or oil prices going up, having a commodity hedge is good. speaking more broadly, i think today's number was a good number, there's a lot of the -- employment numbers are good. short to midterm, you want to be bullish on the stock market, you want to stay away from the bear plays like a long-term bond because we if we have a strengthening economy, possible boost in inflation, then the long-term bonds are not going to look good. short-term bonds yielding something, that's a nice place to height. neil: people don't think in terms of commodities. stocks should be in the portfolio versus bonds and cash and that sort of thing, but it's like a blind spot for a lot of people. should it be? >> i know financial advisers who don't mess with commodities either, they will tell you there's no earnings, no yield. it really is a trade more than

an investment, and i get that. so i don't think you have to have commodities in your portfolio but for people who are a little more trade oriented, who are willing to take the right moment to maybe pare back your exposure is a decent time to be in commodities. on the one hand, anybody doing that in recent years has gotten burned and that can certainly continue. i wouldn't rem it necessarily, but for those so inclined, i'm going to guess now is a decent time. neil: i always try to get to you say something embarrassing and ruin your career, jack. >> let's go for it. neil: and i've always failed. one thing coming up, people are nervous with what's happening with facebook and twitter, the technology, and led to believe and history proves this out that every time you sold those issues or thinking the sell-off will continue, you've been burned, and if you just stuck with them, you'd be rewarded. so there's this should i,

shouldn't i position on technology stocks in the aggregate. what do you say? >> well, a couple of thoughts. for one thing if you have a broadly diversified portfolio, let's say it looks like the s&p 500, you're pretty heavy, the names on the screen right now. apple, amazon, facebook, microsoft, alphabet. those are the huge portion of the s&p 500. so i wouldn't necessarily try to chase them as individual issues, you've got exposure to them anyway. if they get hit, your portfolio is going to get hit. it's been ugly, what concerned me is the intel number. intel had a pretty good earnings report, and that stock is getting hammered. something like twitter, they're finally making some of the house cleaning moves they should have made, looking at the long-term health of that business, i think they're taking the right move and up something like 45% this year. that's okay. same with facebook in some ways, right? you know, this was a start-up,

not so long ago, and now suddenly it's a great big mature company, and i'm not sure that facebook really got the corporate governance thing going at the same speed that their market cap, that their power, economic leverage grew. so they're having growing pains right now, that's still an extraordinary company, and they've got the older folks with facebook, younger people with the instagram. i would not bet against facebook as someone in a business supported by advertising, i see how much facebook is getting. that's a powerful company. i'm not saying jump in, reduce your exposure to the s&p 500. neil: jack otter, always good seeing you, appreciate it. >> thank you. neil: can you take this as a great honor or great worry, investigations going back some cases 20 years of abuse with women. company so far standing behind him but looking at allegation

coming up in a new yorker article. the stock taking a hit because he's everything to this come. after this.

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. neil: welcome back, everybody. the focus of the white house is the russia investigation. the other day my good friend gregg jarrett stopped by, he has a book out, a great book, takes a look at the whole russia investigation. he doesn't quite buy what the consensus media is on it. i started reading it, you might have heard one or two other fox people have books out. that's fine. this is enormously researched, footnoted, references to things that happened back in the stone age. i'm telling you it's awesome. now you can quibble with the conclusions and all of that, those, of course, who don't like the president, others who do. but man, this is a riveting read on what's happening now in

realtime, and whether the president is a crook or whether he's being railroaded. without any further adieu, gregg jarrett, thanks for coming in. >> thanks for having me. neil: exhaustively researched. you come to the conclusion that the russia thing is a hoax. i read the whole thing and i'm just saying it's not all a hoax. there's a lot of stuff bubbling up, right? meetings that you kind of dismiss, other things happen. why do you end up calling it a hoax? >> been talking a lot today about the trump tower meeting. there is nothing illegal about meeting with a russian. i have an entire chapter devoted. not a crime to meet with a russian. it's not a violation of the federal -- neil: you don't know what came out of that meeting, right? >> it doesn't matter. even if there's evidence of hillary clinton wrongdoing, came out, that's a matter of vital public interest, and it's

not a violation of the federal campaign election act which specifically states foreign nationals may participate in american candidacies. neil: what if he said he never knew of a meeting, never condoned such a meeting. >> it's not a crime to lie to the media. if that were so -- neil: you are right about that. >> everyone in washington would be behind bars. neil: does it depend what's discussed at that meeting? >> no, it doesn't matter. i present one caveat in here, if the russian lawyer said here's stolen documents, and if, you know, trump jr. knew they were stolen and used them, that is arguably a crime. none of that happened. our own catherine herridge interviewed the russian lawyer who said we never talked about hillary clinton, i never gave any information about hillary clinton. >> the president and his fixation on this russian investigation. he's called it a hoax. he seems to have come to the

same opinion, but you do acknowledge the russians were involved in mulling around in the process. that's not good. you think the president with vladimir putin should have been more forceful about it? >> you know, that's a political judgment. i think he is trying to engage in rapprochement with the russians to improve relations. how can you argue with that? they're a nuclear power and they're certainly a strategic adversary of ours, and why wouldn't america want -- neil: no i've seen all of that, and i understand why he's frustrated, i don't think it alter the votes or the outcome and all that, but i do think he's betwixt and between how to deal with it, because every time he does, he feels the legitimacy of being president is called into question. i don't think that's right or fair. clearly you don't either. do you think the more we get wind of information like meetings we didn't know were going on or that business

tie-ins prior that we didn't know were there, at least raise concerns about ties that are dangerous? >> i see no evidence of collusion so far, even leading democrats, joe manchin, mark warner, dianne feinstein are on record saying the same thing. trey gowdy said something interesting sunday, as chairman of the oversight committee, i've seen more classified and top secret documents than anybody and yet to see a scintilla of evidence of collusion, which isn't a crime in the campaign as i go about in the book. neil: sean spicer, he has a book out, you are doing better. he said for the president to call it a witch-hunt is not right, you say? >> there have been five investigative committees looking into this. they have interviewed 175+ witnesses, reviewed half a million documents. they have yet to find any evidence. there's no there there.

what i worry about is a guy like robert mueller who has compromised the integrity of his own investigation by selecting a team of partisans and he himself should have been conflicted out, and i write about it in the book, multiple conflicts of interest. neil: are you and the candidate says impeach rod rosenstein and that other movement? >> rosenstein is engaged in continuous acts of unlawful subpoena, trying to hide evidence. neil: do you think there should be a move to impeach him? >> you can't get impeachment. you need two thirds in the senate. it's not going to happen. neil: you don't think there is anything here to warrant further investigation? >> i think rosenstein should be held in contempt. neil: no, the president, his connections, you worry where this is going? >> no, not particularly. i lay out the facts. extensive public record, well established. i lay out the evidence in the law. neil: what about the recorded

phone calls and all that? >> no, look, it's an incredible betrayal to surreptitiously record your own client when you are a lawyer, it's unethical. neil: well, we're recording this right now. gregg jarrett, the number one book on amazon.com. the russian hoax, it is compellingly research, exhaustively noted. i have never seen anything like it. so good for him. >> thank you, neil. neil: we'll have more after this. earnings season once again. >>yeah. lot of tech companies are reporting today. and, how's it looking? >>i don't know. there's so many opinions out there, it's hard to make sense of it all. well, victor, do you have something for him? >>check this out. td ameritrade aggregates thousands of earnings estimates into a single data point. that way you can keep your eyes on the big picture. >>huh. feel better? >>much better. yeah, me too. wow, you really did a number on this thing. >>sorry about that. that's alright. i got a box of 'em. thousands of opinions. one estimate. the earnings tool from td ameritrade.

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. >> the trade deficit, very dear to my heart, because we've been ripped off by the world. the trade deficit has dropped by more than $50 billion. we're doing great, and i'm very honored to see that 4.1 number. perhaps i'm even more honored to see that deficit shrink. >> the president never mentioned the budget deficit. looking at a trillion dollar one this year, like lie a trillion dollar one next year. does he care about it? talk to you about it? >> he sure does. i disagree he never mentioned it. you recall the spending deal, he was pleased to see the military spending he wanted but was concerned that perhaps there is too much other spending. but i would guess that in the

next budget negotiation that we're going to have to draw a much harder line. neil: okay, spoil alert for those of you who claim i'm a never-trumper here. we balance it out with good news and bad news here, i think that's a problem when we focus on the trade deficit and don't mention about the deficit. i think that's setting us up for trouble. let's get the read right now from someone who follows this very closely, she's been bemoaning it. the republican and democrat administrations alike. she's the president, which is an oxymoron, if you think about, it she is not that. maia, very good to have you. the president is very focused on trade deficits. zilch on the budget deficit. that worries me. >> yeah, that's what worries me a whole lot too and it's getting worse. the truth is we haven't drawn a hard line on anything, right? there's an agenda that's come out of the white house and the focus is big tax cuts, that makes the deficit worse, can

help grow the economy but does hurt the deficit. big spending increases, that hurts the deficit more. and no fixes for big entitlement programs which desperately need to be fixed. there's no path forward where the deficit is going to get back to a manageable level. i'm really worried, this is during a period of economic growth. what happens if and when the economy turns down, things will be worse. neil: is he conflating the trade deficit with the budget, you get that under control and the boom, i guess that could come with that. that it helps the underlying economy and the boom that you get from, that translates into more revenues in washington. i don't understand, but maybe you can. >> i appreciate you trying to give him the benefit of the doubt and certainly things that the administration is doing that will help grow the economy, but this one is not one can you find a sane explanation for, because what's going to happen is by increasing the budget deficit and next year's budget deficit

is going to be almost twice as large as it would have been without the policies the administration has put in place. okay? so it became twice as bad approaching a trillion dollars. those larger budget deficits lead to larger trade deficits. it means we need to borrow more to finance our own government spending, unless people in this country save a whole lot more, which there isn't a sign, we're borrowing more from overseas, that grows the trade deficit. not talking about the trade deficit, the budget deficit is going to harm the economy. it means this sugar high that we have right now that's leading to good economic growth numbers in the short-term, it cannot be sustained and leave us in a very economically vulnerable place. neil: you know a trillion dollar deficit and maybe seeing several back-to-back-to-back, maybe more, forget about trying to low slow that down on top of

the levels we're at, but that gets out of control very fast. we might already be at that point? >> no, we are already on that path that would be by definition unsustainable. and what i mean by that is not only are you right, once we hit the trillion dollar number, it's projected to grow forever. already the debt, the national debt is growing faster than our economy. you can't do that forever, that's unsustainable. and the single fastest growing part of federal budget is interest payments. we're in dangerous territory and this is when the economy is doing well because of the business cycle and all likelihood, the economy will turn down in the next few years, we'll be in bad shape where the debt could spiral much faster than we're even projecting. >> maya, one of the things i heard expressed, a lot of people aren't alarmed as you. we renegotiate, shift things around, put them in longer maturities, shorter maturities, depending where you are in the cycle and it's barely noticeable. but i would think in an

environment which interest rates are backing up from the short end and the long end, maybe not as much in the long end but still backing up, danger is danger, right? >> you know, really is every legitimate concern that you will have, if you look at numbers. anybody who looks at the numbers will start to get really worried. neil: right. >> there is always kind of a free lunch response. maybe we shift our treasuries around from short or long or long or short. that's not going to fix it. maybe we just do policies that are so good we can grow our way out of it. we wish that were true, need to grow the economy. but you can't grow out of the deficits from magical economic growth or wishful thinking. problem is nobody is willing to deal with the trade-offs. if we want to have tax cuts in this country, you have to pair them with spending cuts. same if we flip it. if you want to grow spending, pair it with tax increases. right now we have politicians saying this is too important to

pay for and the debt goes up and up and up. neil: doesn't take much to commit to slow that growth. >> that's the first step. we can't do that. neil: thank you, very, very much. all right, so our spoiler alert is off. i hope you, trump and other fans, come back please. little more after this. inta. where we're changing with contemporary make-overs. then, use the ultimate power handshake, the upper hander with a double palm grab. who has the upper hand now? start winning today. book now at lq.com. . .

>> the real is in the last two administrations the economy grew by less than 2%.

in the first 18 months of this administration we were a little shy of 3% last year. we're on track to be at 3% or better this year. and we really believe that the internals of these numbers, whether it be the dramatic increase in business investment, dramatic increase in american exports lead to conclusion the policies president trump is advancing, policies republican congress are supporting are working to revive this economy. neil: all right. i think that is the vice president's way telling our maria bartiromo the trend is our friend. you can see that full interview "sunday morning futures" with maria. much of this concern back and forth whether that trade thing extends beyond that but it seems to be technology focused and the big concern here that stocks give so much are taking it all back. that is the conundrum for investors. do we pull out or wait

patiently? so far they are of a mixed mind. let's go to trish regan to take you through the next no doubt very busy hour. trish: thank you, neil. president trump taking a victory lap, right, about the new gdp report. a pretty good report i might add. the u.s. economy grew a whopping 4.1% last quarter. i'm trish regan. welcome, everyone to "the intelligence report." ♪ trish: all right the president silencing some of his critics anyway with another big win, another big win for the u.s. economy. we grew, our economy, grew at fastest pace in nearly four years. just over the last three months. the president's calling this an economic turn around of historic proportions. so should he get some credit for it? will he get some credit for it? we're on it. north korea fulfilling its promise to return remains what are thought to be u.s.