5:00 a.m., always good humor, stuart varney, take it my friend. stuart: that's 10 seconds early. neil: i'm done. stuart: after 3 choicer you have done well. it is a selloff, i want to get carried away here, a small loss of percentage terms but it is a triple-digit loss certainly for dow industrials right at the opening bell, what's going on? a lot has to do with turkey, the american pastor has not been released, the fear that turkey's trouble will default on loans, trouble for banks that take the hit. trouble for russian ruple, first

time we have mentioned currencies in five years of the show. three items for you concerning yesterday's voting, tim last in minnesota, called mr. trump unhinged. he lost. far-left democrat keith ellison won in bid to become attorney general of minnesota despite allegations of domestic abuse and transgender kristin will be the democrats' governor to run. it would force big companies to ask the government for permission to do base, it would transfer corporate power from the owners, the shareholders to workers and politicians. it's her mark for 2020 election. as you can tell, there's a lot to go at and we are going at it. varney & company is about to

begin. >> it will be down, i'm now looking at a lose about 170, 180 points for dow industrials. liz peek is with us, foxnews.com columnist, right at it, liz, why the sell snawf. >> i think you mentioned earlier that turkey problems -- we have to talk turkey,. [laughter] >> sorry. we have had a number of incidents in the past where a sort of not particularly important event has taken place and far off country and all of a sudden you find out that a major hedge fund have collapse and that's what people have been looking for, the lira bounced back overnight, there's indication that this stabilizin,

what is otherwise incredibly good news on retail sales and other indication that is the economy is so strong and my guess is during the course of today, those things will be paramount. stuart: the money is flowing to america. >> just what we wanted. stuart: just what we wanted. the money is flowing into us, why is our market going to be down 170 points? fear of the longer-term? >> i think so. there's been this tension throughout between incredible earnings gains in the united states and the sort of geopolitical events which some degree have been sparked with trade war and at this point does not seem to have any end. i think investors would like to have some certainty, i view the nafta negotiations as incredibly important here, if we get a resolution with méxico it will signal to the world that we are not in this to create turmoil but there's a point. go ahead. liz: and currency crisis since greenspan started in the 90's,

they can pump liquidities in the market. they've been doing that since. stuart: you think the european central bank can pump money into italy. ashley: they will have to. stuart: hundreds of billions of dollars and you're talking a euro that will two straight down and dollar that will go straight down. liz: they did it in '98 and 2010. stuart: they'll do it because they have to do it, if push comes to shove they will do it. >> the problem with this, earning investment doesn't want to be rescued. if he sort of towing the line here, very important president trump politically, evangelicals are in this mess and fight, so, you know, he could solve the problem, he doesn't seem to want to. stuart: let me chunk some red meat for you. [laughter] stuart: companies should be --

shouldn't be accountable just to shareholders, the owners, oh, no, she wants politicians essentially to control corporations, have at it? >> well, i wish i had an hour because there's not a single paragraph of this op-ed that is not profoundly and fundamentally wrong. let's start with the assumption and this is her main grievance that wages are not going up, the atlanta fed wage tracker that wages were going up 3.3% and hours 2.2% and national income, income of consumers is going up 5 and a half to 6% right now. elizabeth warren is behind the tide on this, wages are going higher and they will accelerate toward the end of the year. secondly, she looks at america corporate history in vacuum for globalists and i'm sure is and peculiar to me that she has everything that the corporate community has done being totally isolated from the fact that in the 70's and 80's america

pumped, significant foreign rivals, fuji film came in, kodak, they had to get rid of culture and become much more profit driven. honestly, i could spend so much time on all the things that she gets wrong. she's profoundly wrong but the last thing i will say thankfully for you is that in germany where they had a lot more worker representation on boards, germany all of a sudden become unproductive and uncompetitive f she really wants to stifle the american corporate community which has begun to put out the green shoots and respond to incentive that is the trump administration, this is the way to go about it. you really have to wonder what she's thinking. [laughter] stuart: 2020. >> totally, that's right. stuart: hold on a second. i want you to look at the headline from the washington

times, mainstream media tries to rewrite history to credit obama for trump's accomplishments, brian, economist, a guy you should know is with us this morning, tell us, we have a nice booming economy, who should get the credit, do you think? >> yeah, donald trump should get the credit. it's kind of amazing when you go back and look at the 8 years of president obama it was one of the slowest recoveries in history, you have to go all the way back to the great depression to find something that was slower and there are always five threats to prosperity and they're monetary policy, regulation, spending and then there's trade protectionism too and if you think about what president obama did he hiked taxes, he hiked spending and he put more regulation on business than any president since fdr. we have now cut taxes, cut regulation, yes, tariffs are up,

but -- and spending isn't as down like i'd like to see it but the bottom line is it's the corporate tax cuts and the deregulation that have led to this acceleration in the economic growth and by the way, they are tax cuts and deregulation affect the economy immediately, there's no lag and so that's why we grew slow and now we are growing faster. stuart: are we going to get away from the turkey problem quickly? it was the thailand, we were over fairly quickly. is it the same thing going to happen today with turkey? >> absolutely. u.s. banks have very, very lit e exposure to turkey. spanish banks have the biggest exposure, 4 and a half percent of capital but the european banking system is a lot healthier 5 or 6, 7 years ago,

this is not a problem where we are going to end up seeing the world and central banks come to the rescue. turkey is hurting, it's because of their policies, it's not going to take down the rest of the world and one of the things, you know, japan, the second biggest economy in the world collapsed in 1989 and yet the u.s. boomed in the 1990's and turkey is tinny, it's nothing compare today japan. stuart: the money is flowing here like you wouldn't believe as of today. brian, i have to run, thank you, we enjoy the cool, calm voice of reason. thank you very much, indeed. >> thank you, stuart. stuart: here is a story that we have been following and it's a major, a real disaster, i will call it that, florida has declared a state of emergency because of the toxic algae bloom. >> some are saying finally they are getting something done. declared in florida toxic algae bloom affecting the west coast

of florida, the fort myers area, up and down the coast from there. a toxic smelly, horrible thing that's been left over from 2017, it was a bad year last year and what they are saying for system -- some reasons a lot of the blooms are not restored. we had video, jeff flock was in a canal area in fort myers and puts a jug in the water to give you an idea how awful the stuff is. what is florida doing, throwing money, biologists to counteract and giving money to local tourism boards to help, this is affecting florida's biggest industry, tourism, people haven't been to the beach in these areas in 3 weeks or a month because it smells, let us not forget and it's toxic to humans too, finally florida is doing everything it can. stuart: no short-term solution, that's the deal here.

can't spray it to make it go away. ashley: if only. stuart: here is something to check out. they are going to offer free beer to cleveland browns fan if they win another game, they have one game in two years. they install fridges and they are locked, when the browns win the locks will be open and free beer will be served. kroger, very interesting company, continuing to innovate, we will tell you about new plan to expand in china. and the mueller probe, it drags on, a new poll show it is majority of people and including democrats want it to end before the midterms, the first hour of varney & company, we are just getting started

stuart: sales down at at macy's, that's hurting the stock,

dropping below $40 a share. moving quick to bridge collapse in italy. you have updated number of deaths. >> yeah, 39 death, 15 injured, the bridge collapsed, plunged 150 feet, fell on a river bed buildings city streets, cars were crushed and people found in cars, it's a 51-year-old bridge, authorities are saying, wait a second, did you maintain it? there was a thunderstorm, 3 trucks and 35 vehicles on it when it collapsed, so now there's a big political fight, the 5-star movement in saying we the populist movement, we will take control of bridges and fix them, this is a political fight in italy. stuart: politically fight wrapped into that, thank you, liz. let's get to politics, two-thirds of americans and poll included both republicans and democrats, they would like to see the mueller probe end before election day. that's a cnn poll by the way.

joining us now congressman todd rokita, republican from indiana, you called end but this was weeks ago, i put it to you, you can't get this, you can't force mueller to end his probe, he's got unlimited power. >> well, sure seems that way, stu, thanks for having me back, not only i was in the house floor end but we've had resolution that's reflective of what the american people are now saying in the latest poll, not only two-thirds of americans want this witch hunt to end but 57% of democrats want this witch hunt to end. so the only one propagating mueller, liberal media elite. >> i think the public is generally tired of this. >> right. stuart: well over a year now, a year and a half almost and -- >> you're right. stuart: never goes away. there's always a strategic leak here and a strategic leak there,

more implications here, implications there, it never goes away, people are sick and tired of it, i think. >> absolutely, a year and a half, 20 million of taxpayer dollars and bias prosecutors, we see with strzok, bias and corruption and fbi that needs to be cleaned up and mueller's team is with hillary clinton's donors and the appearance of impropriety grows every day. they have no evidence of president trump colluding or the campaign colluding with russians or anyone else and the only evidence they are uncovering so far is actually hillary clinton's collusion with russia. yes, this has to end. stuart: could i divide it like this? republicans generally convince that there's no collusion, they want the mueller report released before the midterms, democrats who are not convinced, they don't really know what's in the report, they want to keep it running beyond the midterms, is that a fairway to characterize

the two-party stance on mueller? >> well, sort of. the democrats don't have a -- liberal elites have no ideas on their own, anything that president trump wants they don't want. even if they wanted it before, so they're the ones playing politics here, i used to be chief white collar criminal investigator in state of indiana, you to let investigations go where the facts are to find the truth and i think republicans generally, i haven't talked to anyone here in congress that doesn't understand that and isn't for that, after a year and a half and $20 million it's time to rein this in. that's what resolution does, put up or shut up and if you think there's evidence, tell us when it's going to produce it or get out. stuart: not a prayer that rereleases before the midterms? >> well, no. i don't agree with that. i wouldn't have filed the

resolution, i want this to end, certainly this congress, it's been going on long enough whether it's right before the midterms or right after, at this point, it's going to be hard to control that, but really, if he has any integrity, if he believes in the truth of matters versus the politics of matters he ought to -- he ought to for the good of the country bring this to a halt. stuart: todd rokita, republican from yoind, appreciate it. >> thank you, stuart. stuart: yes, sir, refuses to step down, south carolina tim scott coming up, i want to know what we are doing to getting him back other than imposing sanctions on turkey. we have to talk about tesla, several board members are telling elon musk, hey, stop tweeting, looks like we were right about that one, details next.

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streaming must see tv has never been easier. paying for things is a breeze. and getting into new places is even simpler. with xfinity mobile, saving money is effortless too. it's the only network that combines america's largest, most reliable 4g lte with the most wi-fi hotspots. and it can be included with your internet. which could save you hundreds of dollars a year. plus, get $150 dollars when you bring in your own phone. its a new kind of network designed to save you money. click, call or visit a store today. stuart: the writing is on the wall for elon musk, if you want to run tesla effectively, calm down and maybe close your twitter account or retire to a nice corner office and let an adult run things. well, well, that was full month

old there. employees just urged elon musk, hey, knock off the tweeting. do you think he's done, elon? >> i think it's too late for him, he is done. i think this really smells manipulation because first of all, the tweets considering, second secured funding, he hasn't secured funding, whatever talks he's had with saudi investment, he knew i presume they were buying in open market, if the saudi investment firm is going to participate in lbo they would have had more than they did. they have to increase price on themselves and have to finance. if one-third of investors in tesla sell their stock that's $24 billion, where are they going to come up with $24 billion on top of $11 billion in debt, the bonds is 7%, raise 8, 9%, i don't see it happening, i don't see the

funds being available, i think he's in big trouble. stuart: corner office, let him be the visionary. >> sec wants to go after him. stuart: that serious? >> i think it's that serious, yes. stuart: do we have time for this? no, dow industrials will open 4 midnight's time, we will be down 140 points, positive news on retail sales, strong stuff but all kinds of worries about turkish financial prices, we will be down 140 in 5 minutes from now, and we will be right back. when my hot water heater failed, she was pregnant, in-laws were coming, a little bit of water, it really- it rocked our world. i had no idea the amount of damage that water could do.

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stuart: you know i have 45 seconds before the market opens. [laughter] stuart: there you go. >> just like that. stuart: excitement in the news today, very strong retail sales report that backs up the notion that consumer sector is very, very strong, consumer confidence is strong. ashley: does that mean it's going to be more aggressive, good news is bad news?

and then, of course, there's turkey. stuart: we actually mentioned at the top of the show the indian rupe, all of them are crashing. >> south african, iran. liz: never talked about this. stuart: 9:30 eastern, we are up we are running and we are down, looking like down 127, 130 points, we are down, the best part of a half percentage point and vast majority of the dow 30 are in the red, we have opened lower, that's the dow. how about the s&p 500, broader market indicater, down about the same amount just over half percentage point, show me the nasdaq that too is going to be down even more actually down .76%, we are down all across the board, let's talk macy's, their sales were actually down, it wasn't the sales increased less, no, sales were down and the stock is down 6%, below 40 bucks a share, you have to look at

apple, warren buffet and soros increased stake in apple, more of that in a moment. apple holding at $209 a share. here we go, wednesday morning, liz mcdonald, ashley webster and shah galani. why are we down? >> there's nonbank borrowers and turkey had $198 billion in dlor denominated debt, when the lira fell 20% the cost to service the debt went up about 3 times. >> italian large and spanish and french banks that have huge exposure to turkish debt. fears of 1997. the market fell almost 23%. stuart: keep sense of proportion, we are down a half

percentage point on contagion. nos a huge selloff. >> this is just a little bit of worried, if it were it would be 5 or 10% now. stuart: when the big guys move in like this, it's a sign of confidence, isn't it kristina? i heard it can go to $300 a share, how could it climb even higher, people still buying into the name, why is that? services and apple id, the apple id is assigned to every single person when you apple account, you can walk into account and give id, that's how they will streamline it, you can use apple pay and that's how they are going to monetize it in the future. stuart: buffet bought extra 12 million shares. ashley: after being so antiapple for so long.

>> a little late in the game and now done very well. stuart: 209 as of this morning. we have kroger, innovative company. they are gearing up to sell groceries in alibaba site in china. as i said, kristina, it's innovative company. give me more examples of innovation to fight amazon and wal-mart? >> one of the things they are working on is driverless cars to deliver groceries, word that they will start with phoenix and working on delivering groceries, cincinnati, houston, nashville, it's just an example because you have wal-mart that's working on that, target, amazon has whole foods, everybody is getting into the grocery delivery market and so who is going to do it the fastest way and that's why the driverless car -- liz: amazing they are in china. chinese like to get coffee delivered, now they are hooking up kroger announcing a with

alibaba team mall, platform, it's amazing that kroger, kroger, shobbing grocery store where the big guys wan today play. stuart: kroger is innovative company. facing intense competition from the big guys, they are out there competing, check the big board, lower this morning, 150 points, .6%, that's a drop. look at tesla, i can't get away from it. a member of the board, some of the board members i should say and some employees they are urging elon musk, hey, knock off the tweeting, stop it. well, it's down 4 bucks. ashley: reportedly hiring lawyer ifs this thing goes south. liz: he's considered and i will quote this, i made it up the green steve jobs, is the green steve jobs will get a pass here because he's so profixing climate change or sec step in and say knock it off, you were

wrong, we will remove you from your position. he can't get away with just a slap on the wrist when he already alarmed the markets tweeting out saying, i don't need to do capital raise when he has to borrow money to pay back bonds for tesla. >> i think that one of the things we need to highlight is he said he discussed the situation with saudis back in 2017 both saudis increased share stake within the past few months prior to letting the public know. so the timing of that is a little bit -- stuart: question is manipulation, that's the suspicion in the background. i have to move on. profit falling at 10 cents, now 10 cents is the world's largest video game company by revenue, that stock is -- absolutely tumbled. ashley: don't they own fortnite? stuart: gigantic drop. stuart: down 9 or 10% this

morning. that's a selloff. google's parent, alphabet, investing $375 million into oscar health, that's a small health insurer, big data to revolutionize health care, liz, ash, i have no problem whatsoever with all of these big-tech companies piling cash to other industries. liz: privatized space of medicare, medicare advantage even though they will lose money they are trying to build out space. stuart: i welcome money going into other areas. i want to see more of it. >> especially health care and insurance, big data and reduce insurance premiums, people are healthy and driving safely which is done in driving industry, makes perfect doing and they are on target on doing it. stuart: sales down at macy's, let me repeat that, sales down, they are down, the stock is down

8% at 38. all right, shah would you buy it at 38? >> for two years i was short in retail stocks, they start to come back, i missed macy's at 20, the dividend would have been 7%, when it got to 20i should have been a buyer. it escaped my radar. stuart: you missed it. >> across the board higher. okay. >> i'm not sure anymore but thanks. [laughter] stuart: retail ice age and we were right because a lot of the companies went out of business or slowed down, the survivors are actually doing quite well although macy's this morning not good at all, how about sears, chief offered $4 million from own hedge fund to buy kenmore appliances what's going on? >> since he bought together -- he was star from 1998 to 2003, his investment firm returned 29% for investors, fabulous, absolutely fabulous, one oh the

big magazines had him as future warren buffet. he's lost a lot of investor money and in terms of sears, the stock tanked. how he will get money back out, he's trying to buy for hedge fund whatever is left of the assets in the company. he's been stripping the company since day one. liz: the debt swamps the market value of the company. stuart: if you can read the balance sheet, that's no good. i have to talk about this one, wal-mart is teaming with ellen degenorus with everything under 30 bucks per item, kristina. there's going to be 60 items. isn't the first time wal-mart has done designer mass market collaboration, will this work for wal-mart, think of the margins, wal-mart focuses on groceries and margins have been

low for quite some time and now 30-dollar clothes, you're not really giving that much. it's not like she's coming from -- a lot of the products are made in the united states, ellen, is she a designer, a talk show host and does it very well, i'm a huge fan but i don't know if that necessarily will resinate. but the line is going to be american icon denim. stuart: can i put you done on skeptic on ellen? >> i love ellen and there's a lot of people that are huge fans and will go buy clothes. she's just so cool. stuart: at some point in the future -- >> with ellen clothes. stuart: with ellen clothes. >> you will let me go on. i will do it. stuart: 9:40 eastern time, you are released young lady. it is that time and we have to say good-bye to kristina and shah galani, thank you very much, good stuff. by the way, we've come back, now

we are down only 125 points, half percentage. senator bernie sanders telling stephen colbert that socialism is mainstream and the majority of americans will support his ideals, we will question that one, and senator elizabeth warren wants to give politicians control over corporate america, senator tim scott next, i want to know what he thinks of senator warren's idea. fact is, there are over ninety-six hundred roads named 'park' in the u.s. it's america's most popular street name. but no matter what park you live on, one of 10,000 local allstate agents knows yours. now that you know the truth, are you in good hands? where we're changing withs? contemporary make-overs. then, use the ultimate power handshake, the upper hander

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stuart: we still have a loss of almost about half percentage point, down 147 points on the dow and then we have tiffany, they will get store in new york on fifth avenue there, they are going to give it a big makeover, what's going on, nicole. nicole: over the next few years and this will begin in 2019,

they have the 10 floor flagship store on fifth avenue for tiffany's and they want to give it a revamp, they are trying to bring in more younger shoppers, youthful advertising, flashy products and using the nike town space which recently closed also in the meantime. they plan to spend about $250 million roughly over the next few years, opened in 1837, and moved that location in 1840 and figured it's time for revamp, did you ever see the movie breakfast at tiffany's? stuart: yes, yes. nicole: yeah. stuart: i have been in tiffany with the other tourists. i'm in support of a makeover. do you know that that building that they are in now was one to have first to get air-conditioning on mass scale i think it was way back in 1940 or

something. nicole: the stock spiked 17% in the last earnings report, we will see what we get in tend of august. stuart: stock is down today, however, nicole, thank you very much, indeed. senator elizabeth warren says she wants big corporations to answer to employees and politicians, not just shareholders, senator tim scott republican south carolina is with us, sir, i characterize this as political control over american business, what's your reaction? >> it's a terrible idea, stuart, to be honest with you. if you think of where we are in the economy, democrats are looking for some way to make this economy look poor, bad, to make the american companies look terrible or to demonize american companies. the truth of the matter that without investors there are no companies so this is something that we need to realize and second thing that's important is in a full economy like we have today it is a buyer's market for employees, they can shop around if they want to, the truth is if you want to help employees have

a stronger hand in decisions, go to a full economy and the tax cuts we find ourselves with an unemployment rate at 3.9% and economy is typically at 4%, we are in the best shape for employees to have the type of mobility that leads to higher wages than we've ever had and actually been a very long time, good economy for employees and frankly there are more jobs open today than there are people looking for work so upward pressure on wages continue to increase perhaps the problem, stuart, is that in the bottom quintile of employment, the productivity are hard to make because automation could eliminate about $2 trillion of payroll which makes it difficult. stuart: with all due respect to politicians, i don't want politicians on business, i'm terribly senator, i i don't want to see it. >> there's few -- actually, stuart, there are so few politicians who ever run a

business, that would be awful idea. i've run a business and i will tell you, i don't want politicians on my board of directors unless they run businesses which they have not in recent history. stuart: relate fast senator, the american poster in turkey has not been released, what should we do now? >> yes, well, the good news he's gone from prison to house arrest, senator from north carolina has been leading guy on the issue, he spoke to pastor branson and ambassador bolton, i think we are making progress, the administration sanctions of turkish officials have been positive, the lira is down 40%, there's a lot of pressure on the economy in turkey and frankly i think we are heading in the right direction, we are going to have very -- to be very patient to see things run course. secretary pompeo has done a good job of speaking clearly and with great authority to the folks in turkey. stuart: i want to ask you about opportunity zones, i believe, that you have an initiative with

a colleague in west virginia, opportunity zones, can you explain, sir? >> yes, sir. opportunity zones allows for a deferral of the capital gain's tax up to 10 years if you'll make a long-term investment in some of the distressed communities in west virginia the opportunity for the zones is around the opioid crisis, west virginia has the highest opioid crisis in the country. we are looking for a way to bring new tools to the -- to the challenge. i think one of the way that is we do is by investing capital in distressed communities and allowing for workforce development, infrastructure, new jobs, living wages create bid the market and not the government to tackle some of the challenge that is we see there. stuart: it would be private-sector money, private-sector capital that moves to donees as opposed to taxpayer money, right? >> we have tried to government approach and it's been found

wanting, now i'm looking for a way to deal with work for 200 plus plus of history and that's private-sector capital flowing into areas producing jobs and opportunities in a way that the government has not and i think cannot. stuart: you better ask senator elizabeth warren's permission to do that. [laughter] >> i letter leave that one alone. stuart: sarcasm on my part is allow form of whip, thanks for not biting. >> but it's funny. stuart: on occasion, yes, sir. senator scott, we appreciate you being on the show always, thank you very much, indeed, sir. >> absolutely. thank you, have a great day. stuart: where are we now? down 200 points, we are moving south rapidly, we are down .8%, that's right there at 25,000 on the dow and 26 of the dow 30 are in the red, it's across the board selloff, an example of liberalism run riot on college

campuses, harvard professor calling on universities across the country to blacklist trump administration officials, of course, we are on you shouldn't be rushed into booking a hotel. it. add-on advantage. only when you book with expedia.

add-on advantage. retail. under pressure like never before. and it's connected technology that's moving companies forward fast.

e-commerce. real time inventory. virtual changing rooms. that's why retailers rely on comcast business to deliver consistent network speed across multiple locations. every corporate office, warehouse and store near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver. streaming must see tv has never been easier. paying for things is a breeze. and getting into new places is even simpler. with xfinity mobile, saving money is effortless too. it's the only network that combines america's largest, most reliable 4g lte with the most wi-fi hotspots. and it can be included with your internet. which could save you hundreds of dollars a year. plus, get $150 dollars when you bring in your own phone. its a new kind of network designed to save you money. click, call or visit a store today.

stuart: now we are down 218

points, .87%. that would be general electric, look at that, dropped below 12 bucks, that's 52-week low i believe or certainly very close to it. another 3% lost, ge, 11.99 is quote now. we told you earlier that total household debt, mortgages, credit cards and car loans, totaled $13.3 trillion, but you know, liz, it's a huge amount of money but i think of that as a positive. liz: yeah, people are borrowing even as rates are going up. mortgage rates are going up, 9 trillion plus of this is mortgage debt, what's interesting that student loan delinquencies are going down and people feel comfortable enough to borrow because the economy is expanding, they feel optimism is taking hold. ashley: as long as lending is responsible. we had a story yesterday with scores 620, dangerous road to go down. there's always the people who

are responsible, sign that they do have confidence. i don't want to see a rash of defaults. stuart: consumer confidence -- ashley: it's high. stuart: prepared to go out and borrow to do what they want to do with their money. i've got it. now we are down 220 points on the dow. 25,078, briefly, derek jeter, he owns the marlins, he's requiring all players to learn spanish, what's that about in ashley: spanish players are required to learn english and now he says to be fair also requiring english-speaking players and coaches to learn spanish, derek jeter says everybody expects latin players to make effort to speak english, if you don't speak spanish you don't sink in and that's important. i get what he's saying but doesn't sit well with me. stuart: english is a great

unifier. ashley: you're in this country. what do they call it nationalist type of thing, you know, i'm sure if you go to méxico i don't think you will have to learn -- forced to learn english, i understand the spanish players learning english is great to them, the world's language to be honest with you, but i don't think to derek jeter's point to be forced when you're in your own country. stuart: i'm with you, english is the language of america and in the workplace for sure. do what you like at home. this is of interest to me and i think for liz, the italian bishop's conference announcing changes to the lord's prayer proposed by pope francis, they will take effect in italy this november. okay, what are the changes? liz: lead us not into temptation into do not abandon us into temptation, the pope believes that god cannot lead us into temptation. you know, a lot of people are upset about this, the german

bishops are saying forget it, we are sticking with the old wording because the new and old testament says god does test you with temptation. so this is a real furor going on what jesus made. stuart: quite a step of the pope, isn't it? german bishops are not saying we are not going there. >> very interesting, low of the day in dow industrials, we are 26 minutes and down 230 points. 1% drop. contagion is the fear from turkey's trouble, down 243. the mainstream media can't get enough of the drama surrounding omarosa, but you know, we do things differently on the program. my take explains it all next. id forward to what's next. and i'm still going for my best even though i live with a higher risk of stroke due to afib not caused by a heart valve problem.

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stuart: monday i came back from a three-day weekend. i had deliberately stayed away from the news. i really wanted to get away. i came home monday night, opened up my news feeds. i did not like what i saw. the headlines were all about omarosa, the "n-word," and white house tapes. that is not what i wanted to be reading about, and i suspect many people in america feel exactly the same way. seems to me the media is playing up these tawdry stories, and, president trump is giving them plenty of ammunition. it works both ways. but it is a turn-off. you don't want to be watching the news these days with the kids. you don't want to be discussing stormy or omarosa around the dinner table. we're presented constantly with harsh language, wild charges from disgruntled employees and a president who can't resist a counterpunching twitter storm. you walk away. that is not good. we need an informed public. when the news is a turn-off the public is not informed.

we all lose. on this program we don't spend much time scraping the bottom of the gossip barrel. we want to grow our audience and we do it by reporting on issues that directly affect your life. we think 4% growth is big news. so is the trade fight, the markets astonishing rally, the come back from manufacturing, record low unemployment, and yes, the explosion of debt. north korea, china, iran, turkey, the president puts american interests first and that's news and that's what we cover and that's why we are attracting a record number of viewers to this program. thank you. thank you very much. we appreciate your discriminating taste. stay right there, you're about to get news, not salacious gossip as the second hour of "varney & company" rolls on. ♪ stuart: low point of the day,

we're down 246 points. that is about 1% down, barely above 25,000. the biggest drag on the dow comes from caterpillar. that is a dow stock and it is down 3%, $4 lower. that's leading the dow down. big tech names, looking particular at apple. it is actually down a little bit today, on 87 cents. bear in mind that warren buffett and george soros both upped their stakes in apple in the second quarter of this year. buffett actually bought actually million shares in that quarter. stock's down. sales down at macy's. it is trying to shore up the brick-and-mortar business with store remodeling and off-price location. the stock down 11%. really taking it on the chin in a down market. where is the price of oil this morning? i'll tell you it is at $65 a barrel. down $1.18. we should see the price of gas come down shortly.

now this. listen to what vermont senator bernie sanders said about socialist ideas on "the late show with stephen colbert". >> there is a taint to socialism that turns people off. >> i don't think so. the real issue that the ideas that we have been talking about almost without exception, stephen, are now ideas that are mainstream ideas that are supported by the vast majority of the american people. stuart: okay. socialist ideas are now mainstream says senator bernie sanders. he is talking about basic income, medicare for all, free tuition at public colleges. john lonski is with us now. he is an economist. so you answer the economist question, who is going to pay for all that free stuff? >> you are, stuart. so will middle to high income americans. they're footing the bill. if they come up with the political will power to increase taxes. people will knot agree to it,

best way of doing this increase taxes, talking about health care, increase taxes on the sin goods, alcohol, tobacco. stuart: that will never work. >> that will never happen. stuart: you can tax people on 100% over half million dollars a year. >> you won't get enough money. that is exactly right. it will never happen. >> sorry, sanders always points to the nordic model. we say we're capitalists bernie sanders, denmark, sweden, finland. they're not doing basic income anymore. they're not doing guaranteed federal jobs. they're moving away from that, saying those policies have failed. stuart: last word? >> the other problem with this too, if you socialize medicine that will lower the quality of medical care for the average american. you will have long lines, rationing, what not. stuart: let's not forget that. i want to bring in charlie kirk with turning point usa. charlie, these socialist ideas we're hearing so much about, guaranteed income, medicare for all, free public college, i can

imagine a situation where those ideas are popular with young people. >> debunk that in 10 seconds or less. you ask a college student, do you trust the government, do you trust politicians. the answer is almost always no. i don't trust the government. then you ask the next question, why do you want to make government bigger? why would you want to make government in charge of education, health care and the most important choices in your life? in theory is very easy to believe in utopianism. it is tempting to believe government can run all of this stuff and have all of it free of charge, however if we as conservatives, free marketeers channel skepticism students have toward the world that is where we begin to win them over. bernie sanders is mislabeling actually what socialism is. stuart: you're right, absolutely right, but he is appealing to the self-interest of young people. young people, being self-interested, they would love to get rid of their student debt. they would love to have their kids or relatives go to college for free. they would love to have what

they think is free health care. they're appealing, socialism appeals to the self-interest after the lot of a group of people. that is why it is so difficult to fight back. >> people support socialism because they want to be benevolent. that is not correct. socialism policies go to the selfishness of individuals. here is the important point about free college. focus on that in particular. there are millions of young people made proper and correct choices to go to community college and get themselves out of debt. they get angry when they hear other people will have student loan debt relieved or forgiven. bernie sanders will completely lose middle class 25, 30-year-olds worked their way to colleges if he starts out to float out student loan forgiveness. it does prey on the selfishness of individuals, not the benevolence of individuals. i think that is really important distinction that needs to be made.

stuart: on a similar subject, you will donate $100,000 to charity if alexandria ocasio-cortez, socialist, debates ben shapiro. you made the offer. you got a response? >> that's correct. yes our organization, turning point usa, we raised the money in 24 hours or less between a couple of our donors. we'll see if she accepts. my offer to alexandria ocasio-cortez, whatever charity you want, $100,000, you debate, candace owens, myself or ben shapiro. the check goes to the cause that cares about most. she will not accept. she is afraid of other ideas. she would rather demagogue the moseys -- most disasterous campaign against human rights which is soaksism the past 100 years. i don't think she will accept. stuart: you're a juggernaut, $100,000, 24 hours that is pretty good, son. >> thank you, stu. stuart: get back to the market, get back to the money, session

lows. we're down 283 points. john lonski, economist, why are we down so much? >> there is worry over turkey. the dollar is worried about the strength of the dollar versus emerging market currencies. u.s. consumers are not borrowing heavily. the emerging market market countries take on a lot of dollar-denominated debt that increases the cost of repaying the debt. stuart: i want to explain this one. we've seen a sharp drop in the india rupee, the turkish lira, the russian ruble. all of these countries have debt they must repay in dollars. so how do they get the dollars when their own currency is not worth -- that is ridiculous thing to say, way down in value? that's the problem. >> you have to export more. they have to flood the market with exports. right now we find the prices of industrial commodities, industrial metals are sinking. you pointed out the price of crude oil, that's going down. we have industrial metals price

index that is now beginning to show its first year over year declines since june of 2016. this is not a good development. this tells me that the global economy, global industrial activity is in danger of decelerating. it also tells me in all likelihood, u.s. treasury bond yields are headed lower. and in fact, the head of the bank of canada recently suggested that the fed rethink its bond tapering strategy, the fed's strategy of reducing its holdings of u.s. treasury bonds to less than the upward pressure placed on the dollar, vis-a-vis these emerging market currencies. stuart: this is bad for us, bad for our stock market. >> it shouldn't be. we may be looking at significantly lower treasury bond yields what had been anticipated earlier. that would be good, not only for u.s. financial markets but also for u.s. business activity. economic activity, home sales. stuart: yeah okay. fascinating.

the dollar is going straight up. money is pour into america. >> retail sales are doing well but profits are expected to grow. i think this is a temporary blip. once the bond market adjusts equity market stablizes an moves higher. stuart: ah, the important words, temporary blip, they live forever on videotape. you said it august the 15th i think it is. john, a pleasure. >> thank you. stuart: we're down 280 points, 281, over 1% down this wednesday morning. the denver broncos have their annual rookie haircut day yesterday. the team gives rookies just awful haircuts deliberately. if players have long hair or dreads they can choose to have eyebrows or facial hair. i wouldn't want to look like that. my ratings would really go down. let's get serious. minnesota congressman keith ellison winning democrat nomination for his state's

attorney general. days after denying domestic abuse allegations. turkey rejecting the united states appeal to release the american pastor. we have prisoners from north korea. why can't we get him out, mr. brunson? we'll ask a former advisor to president trump. why can't we get him out? we might have influence here on "varney & company." some companies are changing their policies on emotional support animals after we said something need to be done. you're watching the second hour of "varney & company." ♪

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stuart: where are we now? down 267 points, pretty close to the low of the day. down just over 1%. we have tencent, world's largest

videogame company that's by revenue, profit fell short. first time that happened in a long time and it is taking the stock down 8%. that stock has been tumbling for a couple of weeks. i believe it has lost $150 billion in market value. now that is a tumble. other video game stocks, they're as down on the news from tencent. take two, activation are down a percent or more. chipotle, morgan stanley says buy it. up it goes. it is over $500 a share. chipotle over 500. who would have thought. it languished forever after their food poisoning problem. now it bounced back up again. 509 to be precise. constellation brand, the liquor giant, all kinds of brands in their stable. it is down sharply. that is not the story i got for

you. they're looking into the cannabis, pot drinks. liz: got excited there. now, so, yes, a big, big roll of the dice here. 4 billion-dollar stake they just took upping their stake in canopy. this is can telllation brands, maker of corona beer. canopy makes pot products. they upped 38%. they can take half of the company in a few years if they exercise warrants. they will not make a cannabis drink available or any pot products. they want pot to be legalized across the board. they say there is great growth opportunity here. ashley: so to speak. stuart: the stock is not down 7%, because of liquor companies getting into cannabis drinks. we shouldn't imply that. there must be other reason. >> in sympathy with the market. stuart: the catch-all phrase. ashley: that will work. stuart: let's get to turkey. that's a problem. they have rejected an appeal to release detained american pastor

andrew brunson. turkey also raising tariffs on our products, cars, alcohol and tobacco. christian whiton, is with us, former advisor to president trump. why can't we get the pastor out? turkey is under all kinds of pressure. their economy is really suffering. why can't we get him out? >> like the chinese the turks are only realizing now how serious donald trump is about this and how little leverage they have. you know, you have very strong islamic nationalism. that is what sustained that strong man, erdogan in power, and he is loathe to be seen giving in to the united states but it is hurting his economy dramatically. we saw a dead-cat bounce of lira in last few hours, off 5%. it is off 50% over the last year. the their leverage over us isn't that big. erdogan will sanction iphones. they are not made in the united states. they come from china. alcohol, cars, biggest exports to turkey are aircraft machinery.

this is our only 32nd largest trading relationship. stuart: seems like turkey wants to walk away from the west if i can characterize western europe, north america as the west. he seems to want to take turkey away. and i believe you think we should let him go and take turkey out of nato, right? >> i think so. i think they should be suspended at this point. erdogan has done a great deal to undermine secular democracy. this used to be a model muslim majority country, separated mosque and state. it had a strong foothold in the west especially via nato. they are not a food ally. go back to 2003 when we were invading iraq but we all want u.s. safest forces to conduct our mission. they tried to extort billions and billions from us. only gotten worse. they're going their separate way. we should suspend they're our ally.

people think they will rush into the arms of the russians. stuart: they want to buy a russian defense system and have russians work the software out, maintain it. that would give the russians access to secrets about the f-35 very advanced plane we're selling to turkey. this is a back-door problem of enormous security proportions. >> i think you're right. i think we ought to suspend sales of the f-35. it is willing we're selling these to non-allies like turkey, but not democratic friend like taiwan who are willing to pay cash and carry. russia doesn't have any interests in the type of islammism and islamic nationalism that erdogan is selling. turkey had healthy paranoia about russia and its designs on the boss porous and the black sea. you see photo ops with turkey and russian politicians but i don't think there is anything there.

stuart: christian, thanks for joining us. >> thanks, stuart. stuart: coming up a boston area mayor boycotting sam adams beer and it is because of trump. we got the story for you next. ♪ ♪ ♪ our new, hot, fresh breakfast will get you the readiest. (buzzer sound)

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yeah, i got some financialbody guidance a while ago. how'd that go? he kept spelling my name with an 'i' but it's bryan with a 'y.' yeah, since birth. that drives me crazy. yes. it's on all your email. yes. they should know this? yeah. the guy was my brother-in-law. that's ridiculous. well, i happen to know some people. do they listen? what? they're amazing listeners. nice. guidance from professionals who take their time

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stablizer and that stablizer i believe is going to take the form of lower bond yields. the 10-year treasury, 2.85 right now. probably going down to 2.75. you have to get some of this upward pressure off the dollar exchange rate. stuart: that would be one remarkable rally of treasury bonds. >> i think that is happening. much dollar exchange rate, the, the dollar has become too costly as you said earlier in terms of emerging market. ashley: john is exactly right. the strength of the dollar is really hitting commodities very hard. it is killing the price of oil and copper has gone into bear territory there is concerns about growth in the emerging market. plus china and turkey. people are nervous about the impact overseas as opposed to our strong economy, last word. >> capital spending in china growing at the slowest rate in more than 20 years. that is incredible. ashley: yes. stuart: did you know the unemployment rate in china is 5.1%. in america it is 3.9. liz: i didn't know that. stuart: when is the last time you saw that extraordinary

stuff. now this, the mayor of a town outside of boston boycotting sam adams beer. you got to tell me why. liz: he is is mad because the person who runs boston beer, maker of sam adams, had dinner with the president in bedminster and applauded the tax cuts. the maker of sam adams beer, you know what, mr. president, we were paying 38%, now we're paying 20%. i didn't know this, 90% of the beer made in this country is foreign-owned. he is saying that tax cut helps us go against foreign beer makers. the mayor said wait a second. we don't like this. we need to hold these complicit profiteers of trump's white national it agenda accountable. stuart: oh, please. liz: somerville in massachusetts. the mayor there. stuart: very interesting. summerville. check the big board.

we're coming up. media focusing on gossip instead of the news in your every day life. i say everybody loses when that happens. charles hurt on that story shortly. alibaba partnering kroger, getting into china, finding out ways to take on walmart. kroger, we'll focus on it, one of the most innovative chains today. more after this. ♪ alerts -- wouldn't you like one from the market when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today.

♪ stuart: you play the first opening bar you know exactly who the song is. do you know hot people are on

the screens? they are the sons of paul pick cart any and john lennon. can't you see it. you can see that right. charles hurt, now you know who the two beatles parents were. ashley: brushing up on my beatles. not too thrilled. stuart: the dow industrials, look at this, we dropped 300 points. we just popped on the downside. we hit it ashley, 25,000, down the best part of 300 points. it is 10:30 on wednesday morning. we get numbers how much we're using and how much we have in storage. do you have that, ashley? ashley: expected a draw-down of 2 1/2 million barrels. the build is 6.8 million. whoever does the estimates needs to be fired. we're down almost nine million barrels. that will put more downward pressure on oil. oil is getting killed by a very strong dollar.

that is hurting the energy sector as well which is dragging on the dow. look at that oil falling down 2.6%. stuart: i want to see gas prices start to fall as well. ashley: good luck. they don't fall that quickly, stu. stuart: getting chesty about gas prices. check the big board. we were down 300 just moments ago. we come back a fraction, down 282. big tech, where's that? i think all across the board it's down. facebook is down four bucks, nearly five. amazon is down $44. apple is down a buck, 208 there. alphabet is down $29. microsoft under a lot of pressure that is off nearly $2. big tech getting slammed. walmart, teaming up with, ellen degeneres for a new clothing line. everything will be $30 or less. walmart down 1% on that. don't forget the 10-year treasury yield. that is very much in the news

today, 2.85. it's down as worried foreign money pours into american securities like treasurys, forcing the yield down, 2.85. back to my take, which you may or may not have heard at the top of the hour. i was saying all these omarosa and stormy headlines and some of the tweets from the president, turning people off. charles hurt is with us, "washington times" opinion editor. look it, it is not we refuse to cover these stories. we don't give them a lot of prominence, because i don't want to see people turning away from being informed. >> actually impossible not to sort of cover some of it to some degree, but the enthusiasm with which we see it covered by some of the other networks is just mind-boggling. you take this woman who was derided by all these people mainstream media in the administration, thought to be loyal employer, even though, employee even though at the time she claimed she was working for misogynistic racist which is

sort of an odd thing. who knowingly, willing works for somebody like that but whatever, calls into question her credibility. now she is the most sterling person to interview now. everybody wants to get her on and -- stuart: turn-off. it's a turn-off. for everybody. it is a turn-off. >> you mentioned the things that you like to focus on talking about the economy and wages and things like that are, a lot is very good news for the trump administration. there are tough spots in the world. one of the things gotten missed in the media about donald trump, is that campaign he waged in 2016 was the most issue-oriented presidential campaign i have ever covered. he talked about issues and that is why he won. of course the media got distracted by all the tweets and the goofy stuff. what people were actually listening to, voters were actually listening, what he was talking about doing with the economy, fighting isis, dealing with illegal immigration, all

these very important issues. stuart: he has done what he said he was going to do. >> right. >> he did cut taxes. he did cut regulation. and he has done a very good job of putting more constitution-oriented people in the judiciary. >> absolutely. that is probably the one of the longest lasting things that we will benefit from this presidency. but the other thing that i think, you know, it is very sad. it is very frustrating the degree which so many in the media ignore all of that why they missed the entire election. stuart: yeah. just so sad to see the news descend into mere scurrilous gossip. that is the headline of the day. people don't want to watch that, regardless of which side of the fence they're on, politically, i don't think they want to see this. >> i agree. obviously you can blame president trump for adding fuel to the fire by weighing in on it and tweeting about it and stuff, the way i always look at trump in that respect, he is kind of

like a genius you get all the good stuff but you also get the bad stuff. if you go amongkying with the bad stuff you mess with the good stuff. like a professional baseball hitter. you understand that? stuart: i understand that. >> if you go try to fix some little tick he has in his swing you run the risk of screwing everything else up about him. when i look at trump and tweets about omarosa, you know, you get the good with the bad. stuart: yes, you do. charles, thank you very much, sir. >> my pleasure. stuart: see you on the fox news channel. >> "outnumbered." stuart: whenever you sit next to me i know perfectly well you will be there in few minutes time. appreciate it, charles. we're down 288. momentarily we were down 300. we're right at 25,000, okay? that is where we are as of this morning. talk about kroger. they're teaming up with alibaba. going to sell groceries in china. what an innovative company this is. jack hough with us, "barron's" senior editor.

jack was the guy who was saying buy that stock back in may. it has done very well. you recommended it own the grounds that kroger is one of the more innovative store chains in america today. >> i think they will be able to benefit from the struggles of the smaller, fragmented grocery players. this business about alibaba, i don't think anyone has this story right. here is what i think is going on. kroger has done a tremendous business with chinese tourists in america. the way they have done that is making it easy for these folks. they arrive here in america. some of them don't speak the language. they need to buy ordinary goods. there is an app, they're used to using alibaba and and using ability to buy products at kroger. they like them. they go back to china, hey, have you heard about this kroger? sometimes in china they fall in love with ordinary brand like buick or something like that. stuart: that is how it happened? chinese tourists come to america, kroger has got an app.

>> kroger made it easy for them. stuart: they get on the app. buy the products they want, go on kroger and go back to china. you kidding me, that is how it worked? >> i hear chinese tourists come here with empty suitcase, fill them with kroger brand goods, bring them back home. they like us over there. let's sell over there. liz: how the japanese love pabst blue ribbon beer. >> i mean -- liz: who doesn't love pbr. stuart: that is extraordinary connection between china middle east tourists, app from kroger, go back to china, love kroger. >> i got to go write the story. liz: that is exciting. stuart: you're breaking it here. >> i will spill the beans to your audience. stuart: ashley: kroger beans. stuart: it will be great. talk to you about warren buffett, george soros, they upped their stake in apple, however, here is the news just coming in at us, david einhorn, he is a big-time hedge fund guy,

he is selling apple and buying shares of retail companies. talk about a switch. what do you make of that? >> his recent returns have not been great. he has been on a wrong-way train for a little bit. i don't think, i don't think apple is too pricey here. i think apple was too cheap before and it can trade at a premium to the market. i will say he is buying retail stocks, it seems like a late trade. some. retailers is buying motorcycle total sense. gap, they are too cheap. everyone thinks of the gap stores. the company's name should be changed to ol' navy. that is the story. old navy has become a fast fashion retailer to middle america. stuart: what you're looking at is, for this guy, david einhorn, switching out of big tech, which has been monumentally successful two years at least. ashley: yeah. stuart: going into retail. we've been having retail ice age stories up the wa-z-zoo last

couple years this is switch. liz: he is betting retail will turn around making a decent return to backfill his losses. >> best buy has had a tremendous turn around from the depths. he is buying it now after the rebound. that is bet they continue to go on and do bigger, better things. stuart: six months who would have thought we would be talking about the retail turnaround. >> there are still stores out there. stuart: retail is nicely higher. here is what is coming up for you. millions of refugees are in turkey. the european union is paying to keep those refugees in turkey. if relations get worse if turkey sinks and continues to sink, what happens to those millions of refugees in turkey? will they flood europe again? nigel farage in the next hour. president trump predicting a red

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♪ ashley: in the last hour senator tim scott told us the continued diplomatic pressure on turkey

will lead to the release of american pastor andrew brunson. roll tape. >> the good news he has gone from prison to house arrest. thom tillis, senator from north carolina has been the leading guy on this issue. he has spoken to pastor brunson. he has spoken to ambassador bolton. think we're making progress. the administration sanctions of turkish officials have been positive. the lira is down 40%. a lot of pressure on the economy in turkey. frankly i think we're heading in the right direction. we'll have to be very patient to see this thing run its course. secretary pompeo has done a good job of speaking clearly and with great authority to the folks in turkey. ♪

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call now! take control of your retirement today! stuart: we are down 270 points at this moment. we had been down 300. not. of a comeback when you're down 269 as we speak. jack hough, "barron's" guy with us. we heard from john lonski a few moments ago. this is a blip. we'll bounce back very soon. what says jack hough? >> i'm a little more cautious only because of the backdrop here in the u.s. this news might pass with emerging markets overseas but do you get the feeling, since election day a couple years ago, we've been, the markets look forward. they have been looking forward to tax cuts. looking forward to a boost in

growth. i feel like the gdp print we had couple weeks ago, suddenly investors are saying wait, have we seen the best of it? we think the gdp number coming forward will be lower than that. we think earnings growth next year won't be as good as this year. we don't think the economy is in bad shape at all but there is sentiment among investors we've seen the best of the growth numbers and sets this market what could be a selloff. nothing drastic but we've been due for a selloff for a little while. the slightest news overseas makes investors nervous, could spark a selloff. stuart: what if the news overseas is good, what if they release the pastor held in turkey, supposing china blinks and we get something on the trade front. >> right. stuart: it would be just a inabout. the market would surely go up on that kind of news, wouldn't it? >> it would go up on that kind of news. keep in mind this market is trading premium price, premium relative to earnings. in you're looking forward for an investor what will be the next

catalyst to make people pour money into stocks? are the numbers next year better than we thought we would be? are we reaching escape velocity for the economy. we're watching for the sign. we're not seeing that. stuart: i will break in for breaking news. this is about tesla. you will see it and hear it first, this year, the sec for mali investigating elon musk's statements going private. charlie gasparino on the phone has the story. tell us more please, charlie. >> yes, stuart. what we understand, sources telling the fox business it network the se c-ramped up its investigation. essentially the san francisco office of the sec sent subpoenas to tesla regarding privatization plans and musk's statements. remember the statement he had funding secured. there is obviously a major question whether that funding is secured. so with the advent of subpoenas, that we have sec investigation into tesla's privatization plan, musk's statement, veracity of statements reached what is known

as the formal stages this is formal investigation by the security security into this entire i i am whether those statements were false and whether they, whether they misled investors. as you remember, when he made the statements the stock went up. it is now down on questions as to whether those statements were truthful. so this is now a formal investigation by the sec. we should point out that tesla, it seven, the company itself. stuart: this is news, retained the law firm of cahill gordon for the sec investigation. tesla board of directors retained paul, rice, rifkin for the sec inquiry. this is getting to very serious stage. i will say this, stuart, i've been talking to people who know what the sec is doing, what they're asking, they're between a rock and a hard place on this thing. on one hand it looks like, you know, tesla, we should point out has no comment, the sec has no

comment. it looks like what elon musk said when he said funding secured, particularly after his statements recently was not accurate. they don't have the funding actually secured. they were talking to people, from what we understand, the process of going private is on going right now. that is one hand. it looks like, smells like a materially false statement. tesla denies that. stuart: that is the problem, the problem is the use of the word secured causing a sec investigation. charlie gasparino. right in the middle of it. you got it. thank you very much. the market is reacting. tesla's stock is now down, put it up, down $10 per share. liz, were you were listening to all of this. a formal stage of the sec probe, formalizing, everybody is lawyering up. you know can elon musk last this? liz: having covered corporate accounting issues and scandals and disclosure problems all threw the '90s, preenron, i

covered worldcom, it is extremely rare for the a ceo to tweet like this and catch the board flat-footed f the sec slaps him on the wrist, it gives agency for other ceos to manipulate the market. the question the day he did that when you watch the level of his tweets, how often he tweeted in reaction to the shorts they ramped up starting over a year ago. the shorts built their position, the shorts ramped up. was he taking out the shorts. that is the question. stuart: 10 seconds. >> tweets talked about possibility of the deal. he was so specific on the price. how are you specific on the price if you don't know a deal was going to take place? that combination makes me a little nervous. stuart: before the story was reported. tesla stock was down nine bucks. now it is down 11 bucks, almost 12.

falling. down 3.3%. they're in trouble. minnesota congressman keith ellison winning the democrat nomination to become his state's attorney general, days after denying domestic abuse allegations. we have more on the story and all of yesterday's election results after this with martha mack. ♪

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stuart: rain, it is an across the board selloff. you're looking at the low of the day. we're down one and a quarter percent. draw your attention to tesla tumbling. the sec now entered the formal investigatory stage looking at elon musk, and quote, secured funding he was supposed to have for his privatization deal. tesla is down 4%. that is $14. let's get to yesterday's elections and the primary results. keith ellison won the nomination to be the attorney general of minnesota, that came days after denying domestic abuse allegations. joining us martha maccallum, hosts "the story" on the fox news channel. were you surprised by that one? >> what surprised anyone there was basically no mention from the dnc that he had these

domestic abuse allegations. we live in a moment where these things are tripping up people for good reason across the board in all industries yet keith ellison, it wasn't even mentioned. look for the proclamation from nancy pelosi that chris collins had to step down. in come lips case she said he had to step down. in ellison's case she didn't say a peep. stuart: he wants to be the attorney general of minnesota. >> we're not the judge and jury. the accusation has been made. it wasn't a factor. we'll see how it works for him going forward. stuart: tell me about minnesota where tim pawlenty, he lost. he once said president trump was unhinged. he lost. does that mean that trump has a lot of support in minnesota? >> what is interesting about the tim pawlenty situation, he was supposed to win that primary. he lost it to jeff johnson by about nine points. it was a very big loss for tim

pawlenty. it raises the question about the never-trumpers and how they will fare in the coming midterm cycle. it seems we're living in a moment where both ends of the extremes are the most popular candidates. in the primary process that is often the case. when you look at tim pawlenty, he ran for president. stuart: yes he did. >> he was almost the vice-presidential nominee with mitt romney this is a person who has been a very popular figure in the republican, in the republican party and now can't get nominated. stuart: can i conclude that trump's base is very, very solid? if you walk away from that base you will lose? >> it appears that is the moment we're living in. however, the cook report came out with their new toss-up races. they have now 37 house races in the toss-up column for republicans. in their last read, it was 24. so it is looking increasingly difficult for republicans in the house races, according to the cook report. stuart: 37 toss-ups for

republican. >>s to-up or worse the way they put it. stuart: ouch. martha, thank you very much. >> good to see you. stuart: thanks, martha. >> good to see you. stuart: check the big board. still the low of the day. we're down 323 points, 1.25%. more "varney" after this. (vo) progress is in the pursuit. audi will cover your first month's lease payment on select models during summer of audi sales event.

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stuart: it is now 11:00 eastern time. the look at the markets, will you look at that. that now is the low of the day, down 320 odd points, 1.25%, making money host charles payne with us on this extraordinary day of losses here. why is the market down so much? >> i think the big story is out of china. overnight, it goes back and forth and alibaba is the most valuable tech company in all of asia, had the first decline in revenue since 2015. it's down 29% since january.

you know, this is interesting because -- stuart: wait a minute. you think that set off this? >> absolutely. we are talking about one of the largest companies in the world, one of the fastest growing companies in the world, now 29%, getting hammered overnight. yesterday we had other negative china news. china's economy has been in trouble for a long time but it's a command economy so you push a few buttons, you print some money, subsidize money-losing industries, you make it happen. they are pushing these buttons now, nothing's happening. stuart: you are looking at what's going on deep, deep down with china. >> it's bubbling to the surface. stuart: coming to the surface and affecting us. wait a minute. what about turkey contagion and -- >> it's significantly more important than anything erdogan can do. there's nothing erdogan can do -- when you start talking about a $12 trillion economy that's growing as rapidly as

china's, and you talk about turkey, listen, erdogan over the weekend told the turks hey, turn in your dollars. they have got some issues but i'm telling you right now, this right here, to me the reason it's important is because when we start talking about president trump and what he wants to achieve against china, we know it's fair trade, freer trade but also slowing down the made in china 2025. that's really the central problem here because they are stealing our technology to achieve what they want to have as world dominance. okay? so -- listen, everyone is entitled to their theory but crunch all the numbers, come back to me and tell me what's more important. china economic implosion or turkey boycotting america. stuart: wait a minute. you can't talk about the economic -- >> why not? why not? stuart: they are still growing over 6%. >> you think so? stuart: what else am i to go on? you telling me different? >> there's no way to know. stuart: i'm not arguing with you. i'm not saying you're wrong. i'm saying i think you may be underestimating what's going on

with turkey. contagion in currencies around the world, the flight to the dollar -- >> that hurts our markets, the flight to the dollar? stuart: obviously what's going on with energy. >> right. they came in at $7 million today. stuart: the price of oil is $64 a barrel. >> we got an inventory build, okay? listen, we watch inventory numbers every week and it moves the market every week. i'm just saying, if you think money rushing into the u.s. dollar is going to be a problem, i don't really think so. i really believe that china, their economy, is cracking. stuart: okay. >> i think a $12 trillion economy is significantly more important than anything erdogan wishes he could do to our economy. europe has greater exposure to turkey than we do. they are a drop in the bucket compared -- i want to make one quick point on this china 2025 thing. the market over there, where all their big tech companies trade, is now 53% from the high in 2015. there's an issue there.

if we are ever going to resolve this trade issue, this is central to all of that. stuart: okay. i take your point. i'm not going to argue with you, certainly not. let me bring to your attention tesla. charlie gasparino just reported the s.e.c. wrapping up its investigation into musk's tweet about secured financing. the stock falling out -- liz: when the s.e.c. launches a probe like this, they ask for e-mails and phone records and text messages between -- from elon musk about this issue and anybody on the board and anybody in the executive committee and anybody who is a top executive of the company, also the s.e.c. could go after the wealth fund's records to ascertain what he meant by the term secured funding in that tweet. this is really problematic for tesla. this could take a long time for the s.e.c. to do this inquiry. average inquiry takes like two years to get through this. stuart: well, the word

"secured." must use the word secured. he had a secured financing to go private. did he? liz: that's the question. stuart: he's got a problem. they are all lawyering up. liz: the san francisco office was already looking at elon musk's public pronouncements about getting, you know, not having to go into the capital markets for more financing, and his production goals. they were already -- the san fran office of the s.e.c. was already looking at musk's prior statements, according to reports coming across the transom right now. he's been on the radar screen at the s.e.c. stuart: okay, so what are the repercussions? it's proven he went off, you know, the rails. said he had the funding and all that, it's found to be not true. could he just pay a big fine and it goes away? liz: a fine could run into, you know, tens of millions of dollars. stuart: he pays a fine and it goes away? liz: the problem is the inquiry could take a long time and hang

up the stock. then you won't get the musk tweets about the status of the business. stuart: what have you got? >> it's a knucklehead move. he put himself in a bind. that $420 specific number, listen, if he said listen, lot of folks are kicking the tires, i absolutely think the s.e.c. will have to rethink social media, because i think it's a great way to get news out. i think it democratizes news. the old way, analysts follow the firms, you call up your investment banker, people load up on the stock and by the time the public finds out, hey, guess what. i love the idea of putting out a tweet and everyone in the world can have access, but he was so specific and had so many details and we already know his animosity toward the shorts is so intense that, you know, he had a great -- listen, stock went up $6 billion in value after the earnings in a conference call. it was nearing all-time highs. he had to just chill out. this guy blew it.

he blew it. stuart: the board, by the way, some are saying elon, knock off the tweets. >> he's ignoring them. sometimes -- tesla sometimes tweets as a public citizen, sometimes at ceo. you can't have it both ways. stuart: i have got news on apple. news from the past, actually. it's only down, what, a half percentage point, down 90 cents on a $208 stock. the news is warren buffett and george soros increased their stakes in apple. this was in the second quarter of the year, the april to june period, but they increased their stake. buffett bought an extra 12 million apple shares. what does that make you think about apple? >> well, think about this. apple hit $1 trillion in valuation with a p.e. ratio of 15. people have to understand how extraordinary that is. you could argue this is still one of the cheapest stocks in the entire stock market. here's the great news.

when someone like buffett buys, he doesn't sell, so the stock is in strong hands. while the rest of the world may panic, buffett isn't panicking. he will buy your panic. he will buy you filling into the market. we know apple stock has been distributed into stronger and stronger hands, including their own, because they buy back billions of dollars worth every year. stuart: all right. earlier on the program, we had a guest that thinks the chinese may be getting ready to make an offer to president trump before the midterms as a way to turn down the heat and give him quote, a public success. we will deal with that in a moment. we're watching your money. your money is not doing that well. we'll be back. [ loesch ] this is superbeets and i swear by it.

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stuart: president trump tweeting about tariffs. here we go. our country was built on tariffs and tariffs are now leading us to great new trade deals as opposed to the horrible and unfair trade deals that i inherited as your president. other countries should not be allowed to come in and steal the wealth of our great usa. no longer. hard-line trump on tariffs. nigel, hard-line trump on tariffs did not get our pastor released from turkey. what do you make of that? >> no, that's true. however, donald trump sees tariffs and by the way, isn't he good at winding up his opponents. i think tariffs are great and all this stuff. he's very good at that. i mean, wow. although i was quite good at it but he's absolutely the top. to trump, tariffs are the means to end.

tariffs are the means to getting a better and fairer negotiation. what better example can you have than the imbalance to america and the european union on motor cars? you know, where you charge european companies 2.5% and they charge you 10%. he threatened tariffs at 20%, 25% and you know what happened? brussels put mr. juenker on a plane to the white house to meet the president to say let's try to work towards lower, perhaps even zero tariffs. trump is using tariffs as a threat to get what he wants. look, he's not going to win every single battle but it's important to understand, even me as a brit where we are making a mess of brexit negotiations, if you go in hard in a negotiation, you might just get what you want. stuart: i want to talk to you about china and tariffs. china's economic growth, it really is slowing down. their unemployment rate has ticked up to 5.1%, actually

higher, amazingly, than the 3.9% rate in america. now, there's a trade dispute going on with china. i think somebody has to blink, and it's got to be xi of china and it's got to be if he's given the room to blink without losing face. what do you say? >> i understand that point, but look, let's be honest. over the last couple decades, china have really not been playing fairly on the world trade stage, you know. deliberately trying to devalue their own currency, the theft of intellectual property rights, the happiness from their perspective of continuing massive trade imbalances with them doing absolutely nothing, not lifting a finger, to redress any of this. i think actually if china is now beginning to feel a little bit of pain and if the effects of what the american administration have done are contributing to that, then you know what, maybe,

just maybe china will start to think actually we better start doing this properly. so i am not vexed, i'm not concerned with what's happening in china at all. i'm certainly worried about turkey, you know, which is possibly on the verge of collapse, but as far as china's concerned, i think there are truths coming out. stuart: if turkey collapses, there are three million syrian refugees in turkey. the european union is paying the turks to keep them there. if turkey collapses, they go to europe and you've got that immigration problem all over again. you don't want turkey to collapse, surely. >> no. not one bit. i'm worried about turkey. in fact, my view, stuart, is that wall street is underestimating the potential damage that turkey could do to the global markets. you know, something like $250 billion has been left by america in european banks to turkey. the rate at which their currency are depreciating means

repayments become difficult and default becomes a possibility. i don't want it, but hey, turkey was a valued nato ally, a secular country in a very important strategic location that's now become increasingly islamist. again, they have brought much of this upon themselves. the problem is, if turkey collapses, it will hurt all of us, i think more than anyone realizes right now. stuart: hard line trump not going to change. nigel farage, thanks as usual. see you again real soon, promise that. charles payne with me. you heard that. if turkey collapses, i want to follow that theme, if it does collapse, that really is not good news. >> no. i mean, it's not good news if any economy collapses, particularly one that's part of nato. i think the idea you brought up -- stuart: if the fear of that collapse and the contagion that it would bring is pushing this market down, that is a fact -- >> well, i think, listen, the market was up yesterday and nothing changed with turkey

overnight. i still believe that the cracks in china's economy that are weighing on this market significantly more and when the fastest growing, biggest technology company in all of asia stumbles the way they did, on top of some of the economic data that's been coming in, it's a glaring red flag. stuart: you are an original thinker. you may be way ahead of the game on this one. we value your input. >> listen, i think the social issues with turkey are more important i think, the geographical location with turkey, the things you talked about are actually more imposing, more threatening, to be quite frank with you. turkey has sort of been, you know, in a key position, a key place in the world, but economically, you know, it's not the one that -- listen, we know greece at one point had the world worried. we will see if turkey gets to that point. today, i think china and what's been happening there. stuart: i will check other markets. you have a huge downside move

for the stock market here. what happens to the price of gold? let me show you. i believe gold is down significantly. yes, it is. that's a very strong dollar that's doing that, down 14 bucks. how about bitcoin? is there a rush to so-called safety of the bitcoin? not really. $6,400 per coin. the real rush to safety is to the u.s. dollar and u.s. treasury securities. how about oil? well, very strong u.s. dollar pushing the price of oil down $64 a barrel. i want to see a change in the average price for gasoline. i don't expect to see it soon, not overnight. not overnight. it's at $2.85, the national average price per regular as we speak. i want to see that come down. >> we all do. stuart: get on my soapbox. check out the big board. looks like we have come back just a little. we were down 320, now down 255.

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so again, if $15 billion is enough to be a band-aid, it doesn't say a lot. stuart: temporary band-aid. i have to move on to a different story. i find this fascinating. the u.s. has more million dollar real estate markets than ever. what do i mean by that? cities where the median price of homes is $1 million, half worth more, half worth less, million being the median, 23 more cities have joined the club. now, i can understand san francisco, los angeles, new york, dallas, million dollar homes up the wazoo. liz: the surprises are belmont, outside boston, massachusetts. also looking at bellview, outside of seattle, washington. lexington outside of boston, massachusetts. another one out of seattle, washington. also, the phoenix metro area has million dollar homes, median, rather.

sea island in georgia. it's really real surprises these are keeping up with the kardashian kind of homes. stuart: i feel like they are suburbs of areas we know are expensive. i feel like the rising number of them makes it that much harder, you know, i wouldn't expect less inventory helped push prices higher. no doubt about that. prices are moving up. i would suspect in high tax states, which are getting clobbered by tax reforms, new york, new jersey, connecticut, california, i would expect the super-expensive homes to be hard to sell. who wants to move -- liz: great point. that's exactly the point. there are 200 cities right now with median, the median is $1 million or more. right now, 111 of those cities are in high tax california. 30 of them are in new york. those are the two leading states with the most number of median

value homes -- stuart: i disagree. the best action we have seen in real estate has been on the high end. those people are rich enough, they don't care about what's going on. time flies when you are having fun. now we are down 229 points. we were down 300 just a few minutes ago. turkey's financial markets get the $15 billion capital inflow from qatar. that helped the markets. ♪ 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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stuart: we will bring you up to speed on a couple of developments in the market. first of all, it is still way down, almost 1% lower, but has come back a little and it's come back on news that the government of qatar, the persian gulf oil sheikhdom is putting $15 billion into turkey's financial markets. we can call it a temporary band-aid, call it what you like, but it has helped our market. what do you make of this? >> i heard what charles said earlier and i agree with him. sounds like a lot of money. we don't know the scope of the problem here.

someone on the show earlier said there was a non-bank type of borrowing, $100 billion in turkish loans outstanding and the drop in the lira makes the debt service extraordinarily more expensive infinitely quicker. how will it be applied? that's a fairly sizeable amount of money. where will they put it? do they need that much liquidity? the problem is a lot deeper. stuart: temporary band-aid. >> i think it's a temporary band-aid. if the lira bounces substantially it will take some heat off. if it doesn't, $15 billion is just a band-aid. stuart: next item of news and interest is tesla. we heard earlier today from charlie gasparino, he broke the news, the s.e.c. is formally investigating elon musk's statements. he's back on the phone with us again. charlie, repeat your news and its significance, please. >> it's simply this. this is not just some informal look under the hood sort of thing by the s.e.c. they are formally investigating

the company, the statements made by the ceo, elon musk, regarding going private, because it looks like, and we can say it looks like, his statement that he had funding secured was not accurate. and under every securities law there is known to mankind, putting out a statement like he did on twitter that's materially false is a major problem for the company. now, here's the point i was trying to make before. this is the dilemma the s.e.c. finds itself in. if they get rid of -- if somehow they ding musk or if they ban him from the securities business or prevent him from being an owner, director of a company, or director or executive of a company, that's going to materially impact tesla and the stock, and will hurt investors. so they know -- the s.e.c. knows that on one hand they have a pretty strong case against him. it's obvious that the statement was not accurate.

i mean, the funding is not secured. we know that right now. he's all but admitted that on one hand. on the other hand, you know, doing something to musk will hurt investors, will prevent the company maybe from going private. it will be a big, big issue. so that's what they are weighing, you know. you go back in history to arthur anderson, remember when they put arthur anderson out of business? the s.e.c., that established a precedent. that hurt jobs. that's one thing they don't like doing. stuart: charlie, you released your report on this program, tesla's stock was down $9. now it's down $13, $14. charlie, great story. thank you very much. you said earlier musk is finished. >> i think so. the s.e.c. is going to come after him hard. may take a little while because their investigations take a little time to roll out. it's going to be problematic. if that is the case, ultimately he will have to take the company

private in order for him to remain at the company. otherwise if he's becoming executive of a public company, he's out. it's going to hit the stock. stuart: who will give him the money to go private, i should say, at $420 a share? >> charles is correct. he won't accept $420 but certain shareholders will. it's got to be someone who is really more interested i think in the energy part of this business than the car part. liz: he needs $25 billion, right? if you consider musk's ownership stake is $20 billion or so, that brings it to $50 billion. let me back up. when he made that tweet, when he said funding is secured, there was no 8k filing sent from the company to the s.e.c. saying here's the backup supporting that tweet. the problem is, the s.e.c. again reportedly had already been looking at elon musk's public pronouncements about how he didn't need to go back into the capital markets because he has convertible bonds that company

has to pay off. the bonds are near junk status. you need to pay those bonds off. he doesn't have the cash flow to pay it off. how -- >> you brought up something nobody else has brought up. there's a convertible bond issue here. the convertible bond was under water. by tweeting as he did, the price of the bond went up. if the price of those convertible bonds go up, people will probably convert into the stock. >> at a certain price over a period of time. >> right. which means he wouldn't have to refinance the bonds. so this is the problem the s.e.c. will be looking hard at. no one is talking about that. >> great point. liz: not just manipulating the shorts but manipulating the price he owes on those bonds. stuart: history has been made, ladies and gentlemen. we just had convertible bonds discussed. don't buzz me now, ladies and gentlemen. do not do that. this is serious stuff. tesla is still down, i've got $13 a share.

for all of our viewers who may be thinking about putting money into tesla, what do you say? think again? >> i say think again but i got to tell you, i have been involved ten years and only shorted it once. earlier this year i got out, made a few bucks. you know, you own it? >> i don't own it. i wish i had. i just tell people to stay away from it. it's such an erratic stock i think the average person out there, people lost their shirt after that earnings report. stuart: look at the bottom of the screen. as charlie gasparino reported, tesla's board has retained a law firm, musk has retained a law firm. they are lawyering up. not a great sign. by the way, the dow is now down just 208 points. we have come back over 100 points on news that qatar is going to put some money into the

turkish financial system. google's parent alphabet investing $375 million into oscar health, a small health insuror, using big data to revolutionize health care. look, i got no problem whatsoever with the googles of this world using their massive amounts of -- >> no. it's for the good of everybody, to help get cheaper insurance. they already invested in this company through the venture capital fund. this company was co-founded, by the way, by josh what's his name? kushner. does that ring a bell? the brother of jared kushner, the president's -- >> that's news. stuart: interesting connection. >> it's a connection. stuart: the company originally put itself on the back of obamacare because he thought that suffered but has done well now by expanding other directions and getting money from google.

>> they have the best portfolio in the world. they get every stock at the first round of funding. i think they bought uber when it was going for the equivalent of, you know, everyone goes to them, the first, second round of funding. the portfolio is magnificent. stuart: google stock way down this morning but in line with the rest of the market so let's not complain too much. i have to talk about sears. their chief offered millions to his company, the money coming from his hedge fund. he wants to buy kenmore appliance brand. go on. end of the line for sears? finally? >> i have been shorting sears for quite some time now. i stopped doing it because it got so low, i couldn't borrow enough stock anymore. really, i think this is the end of the line. i thought it would have been the end of the line some time ago. this is to me, i think, eddie has been doing this for some time. he took assets of any value, trying to sell them. he's retained a piece of that,

he's retained a piece of sears property portfolio in his trust. it's rather self-serving. stuart: kind of sad because they were talking amongst the financial media, the next warren buffett, it was a retail play, could do no wrong. he did a lot of wrong. i think he did a terrible job since he's been involved in sears. the stock is now $1.65. all right. thank you to charles and sha for helping us out, lending your expertise. next case, bernie sanders says socialist ideas are mainstream. but every single candidate that ocasio-cortez endorsed, lost. of course, we are watching your money. it doesn't look good. down 230. there you have it.

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nicole: the dow jones industrial average down 244 points. yesterday we got a little bit of a pop but back into the red. the nasdaq broke down below its 50-day moving average for the first time since august 2nd.

there are jitters on wall street. the one-day gain the biggest since june 25th. we are taking a look at some of the names that are moving. here are the dow losers. also, we have concerns about china, turkey and tariffs. we are seeing energy, also materials and industrials under pressure. analysts are concerned about the next four weeks of trading as we are breaking through some moving averages and also the volume seems to be heavier.

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stuart: in the last half hour we have gone from minus 330 to minus 200. now we're up minus 250, right there. i guess you could say the stocks are coming back from their lows, but only just. let me digress from the market for a very interesting story. a colorado school district is cutting down its school week to four days. are they doing it to save money? liz: yeah. they are saying $1 million a year, they will save. they are having a three-day weekend, everybody gets monday off. this goes from elementary through the high school system. this is east of denver, covers commerce, thornton, henderson and aurora. so they are saying it will cut costs and actually attract teachers. teachers will want to come. it is a longer school day. they go from 8:30 to 4:30 but

teachers get monday off. stuart: do the parents get monday off as well? liz: the parents would have to, if they work, have to hire people to watch their kids. but that is an issue. their thinking is that the parents will have their children better prepared for the school week with more, you know, homework on monday. stuart: if it's to save money, that seems like a strange reason to be going to a four-day week. i wonder if it could become a trend. liz: watch this. oklahoma. matt: montana and oregon are doing it, too. >> german factories went to a four-day week 20 years ago because they said they would save a ton of money. they said they could get all the work that's needed done in four days. it's been adopted across europe. they want any day off. yeah, three-day weekend. stuart: i could see that becoming a trend in america. name a school district that's not financially strapped. liz: right.

stuart: you look at new jersey. next case, senator bernie sanders, listen to what he is saying, what he said, about socialism. roll tape. >> there's a taint to socialism that turns people off. >> i don't really think so. i think the real issue is that the ideas that we have been talking about almost without exception, stephen, are now ideas that are mainstream ideas that are supported by the vast majority of the american people. stuart: let's be clear here. i'm throwing you red meat but before i chuck you the red meat to go after socialism, let me say this. don't tell me that young people and poorer people are not going to be attracted by free college, free health care and the prospect of a guaranteed income. that is attractive to many people. you can't just discount it. >> no, we cannot discount it at all. this is so troubling, stuart,

that that is coming from the mouth of the guy who almost won the democratic primary against hillary clinton. he narrowly lost. it's incredible that that's the democratic party of today. you are right to say some people will latch on to these ideas. we saw it in the gallup poll that said 57% of democrats like socialism but here is the key point. a hill poll came out that said 76% of voters overall would not vote for a socialist candidate so i don't think this is a nation that's ever going to go for socialism but we have to make the argument against it. stuart: is the argument that young people go for socialism, or perhaps more realistically, they think capitalism has failed them? >> they think capitalism has failed them. look, stuart, i didn't graduate too long ago. i was on a law school campus just a few years ago, and i can tell you a lot of my colleagues, top students, top schools, shut out of the job market entirely, having to live with their parents not by choice. this is a generation, a lost generation, that for ten years

have seen capitalism not work for them but they are going to see it work now under the trump presidency. we are already seeing that with 4.1% gdp, low unemployment. i think millenials will have a wakeup a-ha moment as they see capitalism wore for them with the trump administration. stuart: as someone who represents the republican party, do you really want to see the democrats go to the far left and use the word socialism and stand in 2020 on the grounds of socialism? do you want that, really? >> 100%. yes, we do want the democrats to do that, because it is a losing argument. the economy is working. capitalism is working. you are going to go out and say let's change the economic system entirely, let's become venezuela, let's become the soviet union, let's become china? stuart: they won't say it like that. the socialism they are talking about is not nationalizing the steel industry and car industry. it's not like that. it's not like 1952. it's more modern version. family-friendly. worker-friendly. poor people-friendly. more money, more health care, more free college.

that's a very attractive prospect to a lot of people. >> it's not working when you have the founder of ikea fleeing denmark when you have a 180% tax on cars in sweden. this is simply not working even there. that's exactly how they will try to say it. it's up to us to point out that socialized medicine failed the american people, delivers less quality and care. free college doesn't work. uk tried that and went back to a tuition-based system. we will make the argument articulately but they will be deceptive as you know. stuart: you may be surprised to hear i absolutely agree with you. >> great. love it, stuart. stuart: talk to you soon. back to money. where are we now? down 227. we have come back a little from the minus 330 that we had earlier. there will be more after this.

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you know, class warfare, no. there is nobody in this country who got rich on his own. nobody. you built a factory out there, good for you, but i want to be

clear. you moved your goods to market on the roads the rest of us paid for. stuart: okay. you remember that? august, 2011. well, today elizabeth warren, senator warren, says companies shouldn't be accountable just to shareholders. no, she wants politicians to have a say in controlling corporations. now, before i chuck you this red meat, as i chucked it to kayleigh there, look, she wants companies of a certain size, big companies, to go to washington, d.c. and beg for permission to do business. you would have to have a charter to do business under elizabeth warren's new rule. what do you say? >> where do we begin? it's beyond bizarre to me, really, she would even enunciate any kind of policy idea like this. it doesn't make any sense. in america, in this capitalist society, money has been made here because of

entrepreneurship, because individuals put their money, their hours, their heart, sweat and labor into building companies. the fact we have roads, the eisenhower administration built the highway system, that was from tax dollars. so yes, that doesn't mean taxpayers are entitled to fruits of the labor of entrepreneurs who provide tax revenue for the government to continue. where else would that money come from? this is bizarre. stuart: under warren, 40% of the board of directors would be elected by the workers. that would give the workers a very significant role in saying how that company is run. >> it would never work, because it sounds very good, sounds great for getting votes but would never work because in the end the workers would take over the factories and pay themselves whatever they wanted, there wouldn't be any profits, companies would go out of business. simple as that. stuart: socialist society, all the resources go to labor. nothing goes to capital and capital investment moving a company forward. liz: if it doesn't, under her law that she wants, they would sue.

stuart: they would sue. liz: that's what she's allowing for. >> giving more powers to workers and the government, it would never work. stuart: i thought i have come to the promised land. more after this. . .

jo breaking news. there is growing friction between tesla and its board. we know both sides, tesla and elon musk and its board, if we can say taking sides, both sides lawyered up. i don't think that is a very good sign. the stock was down 14, 15 bucks. now down eight. >> the stock is reacting to whatever momentary news.

the board is siding with the company, taking whatever precautions it needs to do to protect itself from lawsuits. that will separate them further from elon musk and i think he will be deeper in a hole. stuart: earlier we found out from charlie gasparino that the sec is formalizing its investigation. >> issuing subpoenas. getting into the formal business of the investigation. we know the board members told musk, cut out of tweeting. get out of the way. to your point, stu, they have lawyered up, individual board members, angry at musk for making them legally exposed. stuart: all about that expression, secured financing. that is what musk said he got. >> yes. >> has got to prove he has got it. and prove it to the sec on the screen, big board, dow industrials coming back down again, what, about 45 minutes ago we were down 330. we were down 200. now we're back down 277, falling

again. we have a selloff. back to the 25,000 mark. turkey in the news. china in the news, tesla very much in the news. the dow is down best part of 1%. our time is up. we had good things for three hours. neil, it is yours. neil: you just summed up what i was going to say in the first minute here. you don't mind carrying it for the next couple hours, buddy. thank you very, very, much, stuart. we're on top of all the developments, the selloff as the turkey mess drags on. amidst this investigation into what is going on with elon musk and company here. we'll get into that as well. but we're also getting into the bigger picture after tit-for-tat on trade, beginning with the turks responding to our saying we'll slap tariffs on them. it didn't take long for president erdogan you know what? i can do one better. not just targeting