we have secretary of commerce wilbur ross who worked along with the senators. acting noaa administrator admiral kim galadet you're here. thank you for being here, kim. thank you very much. great job you're doing. every year over eight million tons of garbage is dumped into our beautiful oceans by many countries of the world. that includes china. that includes japan. that includes many, many countries. this waste, trash debris harms not only marine life, fishermen, coastal economies along america's vast stretches. the bad news it floats towards us. i have seen pictures recently, some of you have seen them, vast, tremendous, unthinkable amount of garbage is floating right into our coast, in particular along the west coast. we're charged with removing it which is a very unfair

situation. it comes from other countries very far away. takes six months and a year to float over but it gets here. it is very unfair situation. also unbelievably bad are to the oceans. every year over eight million tons of garbage is dumped into our beautiful oceans and when you think of that number i mean to think eight million tons, i would say probably, senators, i think it is probably more than that based on what i've seen and the kind of work i've seen being done. this dumping has happened for years and even for decades. previous administrations did absolutely nothing to take on the foreign countries responsible. we've already notified most of them. we notified them very strongly. the save our seas act will help address this problem by extending the marine debris program for five additional years. we also are strengthening that up, to improve waste management overseas and clean up our nation's water.

we will boost the federal government's response to oceans waste by authorizing the national oceanic and atmospheric administration to declare severe marine debris events which happen all the time. it is incredible. it is incredible. when you look at it. people don't realize it but all a the time we're being inundated by debris from other countries. this legislation will release funds to states for cleanup and for response efforts. we will be responding and very strongly. the legislation also encourages the executive branch to engage with those nations responsible for dumping garbage into our oceans. my administration is doing exactly that. for example, the new united states-mexico-canada agreement is the first u.s. trade agreement ever to include commitments by the parties to cooperate, to address land and sea based pollution and improve waste management and i can tell you that dan and sheldon were

very insistent trying to get that into the u.s. mca, the new agreement we have with canada and mexico. we'll put it into other agreements also. the united states has some of the most beautiful beaches and oceans in the world and the coastlines are incredible. as president i will continue to do everything i can to stop other nations from making our oceans into their landfills. that's why i'm pleased very pleased, i must say to put my signature on this important legislation. and again, i'd like to thank dan and sheldon and all of the people -- the admiral and wilbur, all of the people that worked so hard on this this was a tough one, but it had great bipartisan support. what was the final vote? >> unanimous consent. >> unanimous? >> yes, sir. >> bipartisan, did you ever think john could hear that? bipartisan. that is pretty good.

can you imagine trump and white house in the same area. hey, i have a lot of respect. >> what the president said about the administration, the trump administration doing a great job on this, an underreported story but they are really take the lead globally. mr. president, we want to thank you, very bipartisan. >> i want to thank you, and thank sheldon. see, we can shake hands. >> thank you, mr. president, thank you very much. >> thank you, wilbur and thank you, admiral, thank you. all right. let's get this done here. okay. with that we're all completed and i just want to say it is an honor. hopefully that goes a long way. we have notified other countries that have been abusers. they abuses ocean. we notified them already about this they're doing things. they tell us they're doing

things. i think in some cases they are but they will be and i want to thank you very much. >> thank you, mr. president. >> thank you, sheldon. congratulations. >> up next, one of the worst three. >> that's right. that will be interesting. so you're working on that? >> we are. with your team on the philippine trade agreement. maybe sure this is a lot comes from there yes? >> [inaudible]. >> we're looking at it, we're looking at it very strongly. we're having a report out soon. we're working with turkey. we're working with saudi arabia. what happened is a terrible thing assuming that happened. maybe we'll be pleasantly surprised but somehow i tend to doubt it and we take it very seriously. reporter: us have any kind of responsibility to warn him? >> we have, it is not our country. it is in turkey. it is not a citizen as i understand it but a thing like that shouldn't happen. it's a reporter with "the washington post." and it's something like that

should not be allowed to happen. something like that should not happen and we intend to get to the bottom of it, yes. reporter: mr. president, talk about the market. the markets are down again today. how long do you think the correction you said -- >> we're still up 40% for the period of time. so i mean the markets are way up over what they were. it is a correction that i think is caused by the federal reserve with interest rates. the dollar has become very strong. which frankly people can debate whether or not like a strong dollar or not. the dollar is very strong, very powerful. and that causes, a little difficulty with doing business. frankly. strong dollar doesn't necessarily mean all good but we do have a very strong dollar and we have interest rates going up at a clip much faster than certainly a lot of people, including myself would have anticipated. i think the fed is out of control. i think what they're doing is

wrong. under the obama administration you had a lot of help because they had very little interest, you talk about economies, our economy is far better than that, we're paying interest. they weren't. they were using funny money. but i think the fed far too stringent and they're making a mistake and it's not right and it's, despite that we're doing very well but it is not necessary, in my opinion. and i think i know about it better than they do, believe me. reporter: mr. president what happened -- [inaudible] >> i'm not going to fire him. i'm just disappointed at the clip. i think it is far too fast. far too rigid. far too fast. reporter: after what happened to the soyuz capsule, are you worried that american astronauts rely on russians about getting into space? >> no, i'm not worried.

we have a tremendous space program. in addition we'll have the space force. that is already in this budget, we'll have our own everything. i'm not at all worried, not at all. reporter: [inaudible]. affect the way you deal with other saudi -- >> we'll see what happens. a lot of work is doing done on that. we'll have to see what happens. i don't like stopping massive amounts of money being poured into our country -- i know they are talking about different kinds of sanctions but they're spending $110 billion on military equipment and on things that create jobs, like jobs and others for this country. i don't like the concept of stopping an investment of $110 billion into the united states because you know what they're going to do? they will take that money spend it in russia or china or someplace else. so i think there are other ways, if it turns out to be as bad as

might be, there are certainly other ways handling the situation. i will tell you up front, right now, i will say it in front of senators, they're spending $110 billion purchasing military equipment and other things. if we don't sell it to them, they will say thank you very much, we'll buy it from russia or thank you very much, we'll buy it from china. that doesn't help us, not when it comes to jobs and not comes to our companies losing out on that work but there are other things we can do. let's find out what the problem is first, okay? reporter: do you oppose sanctions against -- >> i oppose, i would not be in favor of stopping a country from spending $110 billion, which is an all-time record and letting russia have that money and letting china have that money because all they're going to do say, that's okay, we don't have to buy it from boeing. we don't have to buy it from lockheed. we don't have to buy it from raytheon and all these great

companies. we'll buy it from russia, we'll buy it from china. what good does that do for us. there are other things they can do. reporter: will they pay a price. >> there will be something that takes place. wee have to find out what happened. this took place in turkey. to the best of our knowledge, kashoggi is not a united states citizen is that right? >> permanent resident? >> we don't like it, john. we don't like it, even a little bit. but as to whether or not we should stop $110 billion from being spent in this country, knowing they have four or five alternatives, two very good all tentatives, that would not be acceptable to me. okay, but we're looking for the answer and i think probably you will have an answer sooner than people think. thank you very much. i will see you in a little while. [shouting questions] >> we'll have you come in for kahn way for a couple -- kanye for a couple seconds. he will be here. you will have a little fun,

okay? everybody asks -- we have kanye west and jim brown coming. everybody wants to know -- i like jim brown. jim brown is some running back. hey, you think the nfl would be paying him a couple dollars now a days? people don't know, he was greatest football player perhaps. he may have been an even better lacrosse player at syracuse. did you know that? he is a great guy. he has been with me a long time. he has been a big supporter. you come back in a little while. >> thank you. >> thank you very much much. neil: all right. welcome, everybody, i'm neil cavuto. you have been listeninging to te president of the united states commenting among other things about the downdraft in the market noting that even with the falloff today we had our most severe losses of the day, markets are still up, i believe he was referring to the dow up 40% since he was elected. he did say he was disappointed very much, jerome powell, the

man he appointed to head of federal reserve, that fed hiking interest rates in middle of all of this, is a mistake. he will not fire him. it would be very unusual for a president, it has rarely happened, once over the last century where a president fired a federal reserve chairman in midterm. what presidents opt to do not reappoint federal reserve chairman. be that as it may, the frustration the president expressed third time in many days, do not pin this selloff on me, pin it on the yesterday, the federal reserve and constant rate hikes, if the fed chairman is going loco, the fed has gone crazy. today on "fox & friends" the president saying the chairman is getting cute with interest rates, referring to the fact by constantly hiking them, he is throwing water on this recovery. and that is not a net positive. he said just the opposite of course when he was running for president expecting the federal

reserve was keeping interest rates artificially low, quoting from a campaign appearance in september of 2016, and referring to what he called the artificial obama recovery, and federal reserve's help therein. i quote here. they're keeping the rates artificially low so the economy doesn't go down. so that obama can say he did a good job. that is the only reason why rates are so low. they're keeping the rates artificially low so that obama can go out and play golf after january and say he did a good job. so it's a very, very faust economy. obama can leave office, see i told you. we have a very false economy. so far i think she has done a political job, referring to at the time fed chair janet yellen, who he did not reappoint. at some point the rates are going to have to change he added. the only thing that is strong is the artificial stock market. so you could argue that things did pick up steam, the economy

did get stronger. the president taking a bow for that. now expressing surprise that the federal reserve is acting the way he said it should have some two years ago. be that as it may the political back and forth, who is right, who is wrong, we can debate that ad nauseum, let's get a look where we stand at the corner of wall and broad. we are following yesterday's market losses. we have been whipsawedded, we were mildly positive, now splitting the difference here, now down about 107 points. we have 22 of the dow 30 on components down here. we have a lot of tech stocks well into correction territory, amazon among them. down more than 13% from its highs. another 7%, that stock, that high-flyer is in bear market territory. we should emphasize the telling from yesterday's 832 point

selloff extended in the dow went to asia and europe and it was broad-based. in asia, key markets falling an additional 5%. if you're keeping track what is happening in shanghai a good read of the chinese market, it lost a third of its value this year. it is down a third, 32% from its highs. let's get the read from all of this, implications of all of this, market watchers mark madsen, rebecca walter and jared levy. jared, to you on criticism of the fed, few presidents really like the federal reserve raising interest rates. most keep it to themselves. this president chose not to. he is frustrated by it. he think is getting in way of a recovery that could be nipped in the bud. what do you say? >> it is his style to use the media to his advantage. he will put that out there, if rates go higher which they well may, he can say hey in october i complained about it before, and sure enough look what happened. it become as scapegoat if you

will. at the same time i don't know if i would blame rates for what is going on right now. i think what's happening right now in the grand scheme of things in a vacuum very natural. i see, in my opinion the midterm elections and lead-up into that more of the catalyst here. you know, investment managers around the world, traders, thinking about how do i play the midterm election? what if democrats take the house or senate or both? they probably had stops in place. as market started to turn down, these stops started triggering that accelerated a lot what is going on. look at bond market, not everybody is jumping into bonds. it is not that sort of a switch. rates partially to blame here. i think president is getting ahead of it, but i don't think it is just rates getting market lower. neil: rebecca, the president mentioned the possibility that he was not thinking of firing jerome powell the federal reserve chairman. it is kind of scary in and of

itself, is it not? >> that would be unprecedented move. i don't feel sorry for president trump but i feel for him. what he was saying during the election, president obama doesn't deserve any credit for economic bull run we had under president obama because it was pure monetary policy. it was lower for longer and cheap money really sustaining the crazy stock market. that is what he was saying. don't give any credit to president obama. now he has opposite problem. he comes in, cuts taxes, has a great deregulatory policy. it is having huge impact on our economy. it has had a huge impact. now the federal reserve is doing its job to make sure the market doesn't get overheated. they have to raise interest rates. he doesn't think it is fair because it will affect his recovery and the bull market. neil: you're absolutely right about this, the fact of the matter he bemoaned this, and throughout the years how the federal reserve was falsely propping up the market. he wouldn't give more credit to

barack obama. and people as you do, federal reserve keeping rates at near zero for eight years. that would help. he said in an interview later in that same year with cnbc talking about the 0% interest rate environment, mark, i want to raise this with you, it is staying at zero, because she, referring to the janet yellen, federal reserve chair is obviously political and doing what obama wants her to do. she should be ashamed what she was doing to the country. you could make the argument i think as rebecca just did, the federal reserve has obligation to get normal range of rates and 0% was not normal range. now the federal reserve is playing catch-up with the the realitying, more comfortable doing so but stick it to this president. what do you think? >> i'm not concerned who gets credit. every day main street investors trying to plan for retirement

and plan for their american dream, what do they do when they see a massive drop in the market like we've had over the last week or so? that is what they normally do is panic. they get really afraid. they sell stocks, buy bonds and what they should be doing is exact opposite. market was down 4% yesterday. investors rebalance portfolio and sell fixed income and buy stocks while they're cheap. they are cheaper in america. they are cheaper internationally. neil: never catch a falling knife, how do you advise your clients? if you rushed in thursday, the week before, october 19th, 1987 crash, when the market was tumbling, that was daredevil time to come in, obviously you would lose another 24%, right? you never know when is the right time to get in. >> yes. neil: why do you think now might be? >> yeah, i'm not talking about getting in. all investors, long term investors should have a portion of their money in equities. don't jump in and out trying to market time. you will never know exactly when

it is going up and down. what i'm saying international is down even more. international is down 10%. neil: right. >> you want to rebalance, sell the things, against your human emotion, because everybody wants to stay short-term focus and get afraid and panicked. we want to do stay, 10, 15, 20 years. nobody knows the next 20% move but historically the next 100% is up. don't panic. stay in there. neil: jared, another view, keep holdings the way they are, don't do a darn thing, what do you think of that strategy? >> well it is not bad compared to what most people do. neil: go ahead. >> i think we're kind of in the same boat. i think from a psychological perspective i can't tell you, literally my mother is calling me, my grandmother, every client, what's happening, should i jump out? you take a step back look at your time horizon, if the time horizon is next week, maybe it is time to go, if time horizon

is several years out, use moments to target stocks like you buy. take profits in amazon and facebooks, ones you had great gains on. it all comes back to psychology and as much as we can get up here and tell people to calm down they're not going to until the market starts to creep back higher, until the confidence returns. hold your course. look at your time horizon. be aware of what stocks you're in and not in. neil: rebecca, do you share the view, with all the attention on the selloff last couple days, we're still appreciably up, we've still seen some eye-popping returns for stocks, even when they go into bear market territory go up a whole lot? amazon getting close to that, but still up 50%? >> yeah. i do agree with jared's point. i think what is happening here, neil, a big thing happening here, there is overarching psychology of a couple of things. one, we are in uncharted territory. this is the longest bull market in the history of our country. so i think you have people sort

of stuck in the equity market because there has been nowhere for them to go and they're starting to look at these yields hey, i can get over 3% for the first time in nine years if that sounds like a deal. they're starting to look at these -- neil: and guaranteed. >> guaranteed. no risk of loss. neil: if that is the case, what level do investors weigh that, boy, 3% doesn't sound like a lot but it is more than losing right now 30%? >> no, 3% after taxes is more like 1.5%. so -- neil: you don't think that will work in favor? >> doesn't allure me. neil: okay. >> if you look at stocks historically, s&p at 10%. micro caps at 12% and small value at 14%. if you are planning for long term reyou need real growth in your portfolio, inflation is 3%. 3% inflation, minus taxes i'm

underperforming inflation with it. bills. i'm not convinced that the is way you plan for long term future. neil: while they were speaking they must have done something. 10-year note is down one week lows. that has taken the dow well off the lows. these are fast market conditions. anything can and usually does happen in such an environment. we're also seeing money pour into the darnedest areas. we'll get into that. and how much is too much and how much of a fall is too much of a fall? with the president fingering the federal reserve is behind the falloff. why david stockman says the federal reserve isn't your problem, mr. president. right now the overhyped market is. he next. a porfolio based specifically on their needs.

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clip. it is far too fast, far too rigid, far too fast. neil: president is not a fan of what the federal reserve is doing to sort of rain on his party to be an economic boom. that is a little bit different what he was saying around this time in 2016 when he was running for president of the united states. take a listen. >> they're keeping the rates artificially low so the economy doesn't go down, so obama can say he did a good job. that is the only reason the rates are so low. so they're keeping rates artificially low so obama can go out, play golf after january and say that he did a good job but it's a very, it's a very false economy. we have a false economy. neil: all right. his argument then as a candidate for presidency of the united states was that the federal reserve was okay straight -- orchestrating a rigged economy, rates were higher than their norm. he was right then. but arguing for the federal reserve to get back to a norm

now it's wrong. former reagan budget director david stockman who kind of agrees with the federal reserve and how it can sort of rig things but maybe in this case going too far, what do you think? >> i think he was right the first time and he is out to lunch the first time. he caught it one big fat ugly bubble. that was true in the fall of 2016. it is 40% bigger now. it is an even more egregious bubble. this isn't a sustainable market. we're getting a little bit of a wake-up call but there is a lot more to go over time. neil: when you say a lot more, what do you mean? >> i think the market is way overvalued, month 112 of a business expansion, six months from the longest ever. neil: we came from the worst recession since the depression. >> but we had weakest recovery as well. the money has not invested. they floated into wall street. neil: if you buy the president's

argument, the federal reserve should been raising rates after the precarious period after the melt down when it cast keeping rates low, it ended up keeping them near zero for eight years. that was too long. >> that was a huge mistake. neil: he doesn't like it happening under his watch? >> we're still there. inflation was gone up, inflation was 1 1/2%, funds rate was 1 1/2%, it was still negative in real terms. neil: federal funds is the bake overnight lending rate. now it is getting closer to equalibrium. to be fair it is 2 1/2 now. it should really be to keep with norms around 5%? >> of course. today the inflation rate came in at 2.4% year-over-year. the funds rate is 2.13. we're still underwater. eight years, negative real money market rates. that is the biggest incentive for speculation and for bubble building on wall street that you can imagine. >> where is the bubble? a lot of people look at it? they didn't see the bubble like there was prior to the internet

bust? >> it is even worse. neil: where do you see it worse? >> take amazon, set aside a ws, the cloud service, basically it has one billion worth of income and rest of amazon, the e-commerce is valued at 700 billion. it was a few days ago. that is 700 times earnings. >> you can also look at aggregate multiples say it isn't rich and gotten decidedly more affordable now. you think has a crash level to go? >> of course. amazon is absurdly valued. so is netflix. so is the whole nasdaq 100. let me give you a number. it has been 11 years in the precrisis peak in '07. 11 years. during that period, nasdaq 100 up 200% after inflation. how much is labor up? 6%. how much industrial production up? 2%. manufacturing up 11 years, down 3%. you can't have an economy on

main street going nowhere and a stock market going up 200% after inflation. neil: economy is going somewhere. i'm not crediting it to the president or not crediting to him, the pickup in economic activity which seems fairly broad-based is that all a bubble to you? i can see what you're say about some technology although you lump a lot in with amazon. i'm wondering whether you're being fair to the overall economic performance today? >> what we had one quarter of 4%, 4.2%, it was anomaly. it was a full forward of exports around the world. neil: do you think it will be a lot slower this quarter? >> i think it will be down this quarter. there is huge inventory building. neil: atlanta fed, not always reliable but -- >> it has been more wrong than it has been right. neil: atlanta fed says david stockman -- >> can't take one quarter annualized with all aberrations. neil: what will bring this crash? >> old age, death. we have 69 trillion of debt on

this economy, public and private, compared to 52 trillion before the last crash. neil: bull markets never die of old age though. something else jostles them. what will jostle them? >> three things. the trade war is absurd and will have far bigger repercussions. i think he is going the full monte. 500 billion of imports from china go into everyday purchases of american households. those account for 30% of the goods in those categories. china sets the price. raise it by 25% everything will go up. it is the marginal price. neil: we have the option not to buy that stuff. >> you will buy it from somebody else, and they will -- neil: holiday sales there could be problems? >> hundreds of billions of additional costs -- neil: i want to be clear. trade will be an issue? >> number one the fiscal collision coming is out of this world. it is not the interest rate is the real issue with the fed, it

is shrinking their balance sheet finally after this absurd eight-fold increase in the last decade. they're taking 600 billion of debt they own today, treasurys, and fannie maes, dumping them back into the market. that's called qt. called shrinking the balance sheet. neil: right. >> at the same time the treasury will borrow in the year we're in 1.2 trillion, crazy. 6% of gdp at this late-stage after business cycle. neil: interest rates can only go up? >> interest rates can only go up. if we had a shock in the market at 3.25 in the 10-year we'll be over 4% soon. neil: what about premature shock, might be jolting cooler heads will prevail, i have no horse in this race. early february, whatever this year when we had something similar going on it ended being short-lived people pounced back into the market. what makes you think this time won't be different?

>> for one this is a massive bubble that can't be sustained. the market even after this correction, s&p is trading at 22 times its current gaap earnings. now that may be food when you're just coming out after recession. neil: 18 times forward earnings. >> i know. i know, neil. those are hockey sticks they're terrible rich. neil: you were there for the '87 experience with ronald reagan. we had much richer multiples then. to your point we had growing concerns we were ignoring prior to that what was going on abroad. to your point we have signs that is festering not only going on in asia, chinese market down a third from the highs. >> yeah. neil: european markets at least four in bear market territory, italy is falling out of bed, is that the catalyst here? >> the key thing there is no one multiple size that fits all. neil: right. >> the key thing when you're in old age in a business cycle, nobody abolishes recessions you don't pay 22 times current

earnings or 18 times forward, likelihood next two years we'll have recession. earnings drop from 122 to 75. the market will go through a 30 -- neil: 122 to 75? >> $122 per share on the s&p 500. they always drop 40% in recession. the next stop is $75. it is not 160. neil: you could argue these higher rates all of sudden change the math on those earnings on those multiples in a good way. >> no. rising yields cause multiples to shrink and argument we've been hearing for years -- neil: that is my point a lot of people look at that all of sudden this doesn't look like a rich market to me or as rich? >> no, no multiples are way too high already. as interest rates go up the multiples have to shrink and therefore stock market prices will go down. neil: all i'm saying, there is a lot of people who seize on this meltdown, whatever is going on to say, it is depressing these stocks, it is depressing these earnings to the point the price

and earnings are a lot more favorable to investors. you're saying that is not going to be the case? >> no, i'll tell you why. in 2007 before the last crisis, on s&p 500, interest cost after tax was $50 a share. the fed drove interest rates down in the basement. trump was right about that in the campaign. last year the cost after tax was $19 a share. i will tell you that it is going back to 50. that $30 of additional per share of additional interest costs isn't factored in at all. neil: you worked with ronald reagan. his view markets versus this president's view of the markets? >> totally different. okay? he didn't confuse himself with the dow jones average. ronald reagan understood what capitalism was about. if that was happening because people out there in america were getting bullish. they were believing he was turning around the economy. that earnings prospects were getting better. that his tax cut made a difference. today donald trump is a massive

egomaniac who thinks the stock market is a referendum on his brilliant leadership when it is going up and somebody else's fault when it is going down. he is a dangerous man. he is dangerous on trade. he is dangerous on this deficit. and the last thing we ought to be doing is attacking the fed when they're finally getting enough gumption to get interest rates to some kind of a normal level and to shrink their balance sheet and get their big fat thumb out of the stock market and the bond market and let capitalism do its job. neil: there you go again. the man was taken to the woodshed speaks his mind. did back then. you can agree or disagree but he does make you think. right now the dow jones industrials are down 90 points. we were up a little bit prior to david coming here. look what you did. all right. we'll have more after this. oh, that's great sarah.

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neil: housingif you're a homebuilder last thing you want to see price of homes and people affording mortgages trying to get prohibitive. they are off 20% from their high levels. that is routinely the case, virtually every major player's case here. is that overstated, is that overdone, people till have more hurt to come? when it comes to housing, housing stocks and housing as a sector and vibrant part of our economy? we have greg rand and deep digital chairman dave maney. dave what do you think? >> that creates a big, big drag, neil. when those mortgage payments start going up and i think it does have the trajectory to change what is very rosy situation. don't forget, that homebuilders also typically have big land

inventories that they're paying, carrying costs for. so that also turns out to be a big drag and a big problem and harms future. it is not a big cycle so that when rates start rising meaningfully. neil: i know markets can go up and down, and gyrate wildly, for housing itself, this is going on, with these issues, long before any of this stuff? >> yeah, well, rates going up 5%, i'm not concerned about that. the behavioral pattern, decision to buy a home is driven by things that have nothing to do with mortgage rates for most people. which house to buy, if the house you wanted to buy is out of reach now, because rates went up, you buy a less expensive house but the demand drivers, consumer confidence, confidence in their job, overall good feeling about the economy, the desire to own real estate investors are seeing a bump when the activity happening right now because most investors still working with a lot of cash or

debt that they got behind the curtain, not on the specific property they're buying but on the fund they're working with. when the overall economy take as blip, especially stock market taking a hit, it tends to drive some people towards real estate because tangible investments become more attractive. neil: the flip side of that argument, dave, you have to get in while the getting is good. the president making clear he is truss straighted with the federal reserve. i don't know if that will necessarily move jerome powell to move any slower or faster on interest rates. i think he will try to keep distance from that but it is clear interest rates continue going up, right? >> it would seem that way. as david stockman was saying before, there is lots of good reasons that continues to happen. it is true that could be potential homebuyers just move their segment according to the numbers, let's remember that none of those decisions are made in a vacuum. i'm not sitting here saying that i think, i'm not sure i agree with mr. stockman that the sky

is falling or about to fall but having said that, you know there is no way to divorce the barometer that is, that are the markets, it is not divorced from the whole economy. how those employees and potential homebuyers feel about the economy and their jobs and security, is were this thing to continue, were we to follow downward path it is all rather tightly linked. neil: can you have housing, greg, going one way, market going another? we know in many instances but the 87 half a crash, a year later did affect real estate, what do you think? >> if the market crashing causes overall economy to lose steam and consumer confidence to go down, well, sure. housing is more tied directly to population growth, raw population growth. it is most fundamental asset class that we have. if people live here, want to stay here, come here, pop graduation growth, people want

to live indoors, housing in particular, residential real estate, tracks to population growth and general consumer confidence. if folks get fearful, what happened last time around, six, eight years ago, with investors came in, because they have long-term view that said that the housing market was going to come back. so they piled capital in. we found the floor in 2011, not because of homebuyers, but because of investors crowding into the space. so the balance of whether a property is going to be a rental, a home, is going to be rental home or owner occupied is the fork in the road that if the economy is going well, homeownership drives up. if the economy goes the other direct, rentership drives up and it hedges itself a little bit. neil: dave, by that, if jobs are still strong and growth is very respectable, it is probably an understatement that could be the tonic here? >> yeah, look, as i said i'm not

feeling like wildly economically bearish. it is two separate questions. neil: right. >> what is going on with the economy and the markets is one thing. i think it's a little bit of whistling past the graveyard that it is self-correcting. if we go into economic tailspin, the housing guys will get whod in the behind in a big, bad way. that is reality. neil: gentlemen, thank you very much. for those that tuned in. we're down 100 points right now. after yesterday's 831 point bludgeoning in the dow, which is certainly among the biggest point declines ever seen, wouldn't make top 10, when it comes to percentage hits a lot of people are focusing how. of a downdraft we are from our highs in that. we're getting down around the 6% level for the dow, about the 7% level for the nasdaq here. it is an inexact science but close to correction territory on close to half the issues part of s&p 500. when it comes to technology

virtually all the premier names are at or near that level. and after a correction can come a fast move down into bear market territory. 10% from year highs to be in correction. another 10% to bring it down bear market territory. many of the issues are up 50% or more. you're still in the money. the question for those investors, will they lock that in and sell or wait this out and pray? more after this. so they say that some day ai will transform the human race. well, today you're a little busy transforming your call center. dealing with millions of customers a year, like this one. no, i'm pretty sure i didn't order a squirrel playing a guitar. that's why you work with watson. it works with your systems to resolve calls faster and improve customer satisfaction. i detected fraud and helped reassign a new credit card. honey, they're overnighting us a new card. woooo!!! woooo!!! for ai that works with tools you already use, choose watson.

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neil: all right. tropical storm michael now but had been a hurricane 4 within one mile i'm told of becoming a category 5? it's a doozy. we've never seen anything like it in that area, in the better part of a century. jeff flock know it, assessing damage as we speak. hey, jeff? reporter: neil, hi, yes, incredible power. fortunately the power concentrated but concentrated not far from where we stand. take a look at this the aftermath of scene. line of track, as far as you can see this way. as far as you can see that way. trying to get into panama city. the panama city, it is the most populous area around where the hurricane hit. it was not a direct hit on

panama city, direct east of it. this is part of the eyewall. this got a ton of damage and, these are folks trying to get in, in addition, emergency vehicles up there. those are vehicles that would clear roads, we've also seen. rental vehicles bug supplies. national garth coming down the road. if you lived here, out, evacuated, don't come back in. a lot of people would like to get back in, you can imagine. a tough situation. it is a small town, small city, right now epicenter of recovery. neil. neil: we know this hadn't occurred in many years, came into, the odds of any damage being low, do we know?

reporter: we estimate, at least local officials estimate, best estimate about half of the people were asked to evacuate, evacuated. two factors, one panama city, panama city beach, a lot of new construction is hurricane-proof, quote, unquote. so people stayed for that reason. a lot of this is also rural and people who are not used to evacuating and just, you know, fending for themselves, well, a lot of those are mobile homes and homes that have trees on them, all the rest. so you know, it will be a lesson perhaps for those that did not. neil: thank you, my friend. glad you're safe and your crew. you're amazing. will say that. braver man than i, that's for sure. all right, i do challenge jeff if we're on a line at ponderosa who could be most aggressive. that is whole different contest. that is for another moment. look at what is happening in the corner of wall and broad here. the selloff ensues. a lot of people are of different mind of this, want to shake this

out, whatever the momentum is, get it washed out. that is a expression comes out a lot. i don't know if i necessarily buy that. normally doesn't wash out on its own, can drib and drab for days, weeks, revisit itself. but there is a competing view on that. there is also a look at foreign markets, whether they stablized. we're beginning to see that as this rolled across europe what had been two, 2 1/2 declines, ended up being 1 1/2% declines, still significant, but improved as trading wore on. that was not the case in asia, where for example, in the case, particularly of the chinese market, it is down 32% from its highs. so it is already feeling the pinch. we'll have more after this.

neil: all right. we're down about 133 1/2 points. we had seen virtually all dow 30 stocks down before. a few more back in the green, some nominally so, but the selloff continues after the 831-point hit yesterday. whatever you make of what happened yesterday, what continues today, the president making clear don't blame me, blame the federal reserve. he has said over the course of the last three days, in fact, getting progressively nastier at the federal reserve that the policy is now going loco, the fed has gone crazy, saying today i'm not going to fire jerome powell but i am disappointed.

for more on the white house fallout here, blake burman at the white house. blake? reporter: as you know, it's supposed to stay away from this sort of stuff when it comes to the federal reserve, not supposed to weigh in on federal reserve policy, or at least that's tradition, but the president has jumped into this with both feet going forward over the last few days or so. you just ran through some of the descriptions he's given of the federal reserve. let me give you a few more. he said that it's gone wild, it's making a mistake, it's being too cute. just a few of the things from president trump over the last couple days or so. the president, though, despite all of that, made it very clear just a little while ago here at the white house that he has no plans at the moment to fire powell. watch. >> the fed is far too stringent and they're making a mistake and it's not right, and despite that, we're doing very well, but it's not necessary in my opinion, and i think i know about it better than they do.

reporter: larry kudlow as well today was asked whether or not the president is taking any sort of special action to stabilize markets and he also made that clear, that the president is not, the president at this point at least is not going to jump into that at all, at least keeping the fed independent. the white house is still building up its argument that this is a bull market correction, even the president using the term correction today, but something he said they viewed was coming at some point down the line and here we are. neil? neil: thank you very much. if you are getting rid of that october feeling it's probably a good thing. october not the worst month for stocks but certainly tends to be among the most memorable. deirdre bolton here to pick it apart. >> that's a great way to put it. we had 1929 black tuesday, 90% drop, great depression that followed, 1987, black monday, 22% drop in one day, financial crisis. technically it began in the last week of september, but it certainly continued through

october. the past 50 years, this is actually just a month but i can tell you this, october clearly the most volatile on record. you have the highest share of daily moves, 1% in either direction. for the s&p 500, that is. oddly enough, october does show positive returns on average. the volatility is that. we will show you a vix chart and you will see this compilation from monthly averages from 1990 all the way to the present. okay, here's october, right, so clearly this backs up what we're seeing. the vix of course commonly known as the fear gauge. harvard business school research cite a few theories. one idea is everyone comes back after summer, puts on big trades. it takes about a month to kind of come to fruition, that's often in october. another is that the u.s. government fiscal year begins october 1st so you have a lot of influences on big industry contracts, other plans. others say this is third quarter earnings season, it gives a picture of how companies have done, then last kind of going

over the finish line to the end of the year, it's a report card. this one's a showstopper. fang stocks, i will put them up here, they have led this year's rally. they have been losing the most in the past two days. in fact, yesterday alone, $125 billion in market cap was just wiped out. you do have facebook climbing back but obviously not the same for amazon and apple. mortgages, as you know, too, approaching basically 5%. that could be a fresh blow to the housing market. that's your last chart there, based on that ten-year treasury yield. economists are saying that could even weigh on the housing market. neil: incredible. >> lots of moving. neil: i covered that 1929 event. >> you did not. neil: thank you very, very much, putting it in perspective here. we are going to go to the white house. we are getting this delayed pool feed featuring kanye west and others. the president has gone out of his way to say i'm well aware of the selloff, don't forget the gains we've had, the 40% appreciation in the stock market

since i was first elected president. he is also saying right now that you can point the finger and he already has, at the federal reserve. they are getting a little too cute with interest rates, and he said so again today. said he doesn't have any intention of firing jerome powell, the man he picked to lead the federal reserve, but that he doesn't like what they're doing and they are risking an economic boom by doing so with the constant hikes in rates. we should also posit that even by bringing up federal funds rate, the key rate that has essentially gone from zero to 2.5%, it is still way, way below its historical norm which should be closer to 5%. now the question is, is jerome powell or his fed cohorts going to slow that rate increase down because of the president in the white house or because of what's happening in the markets, or because of both. a lot of folks really have no idea. that could weigh on the markets themselves. by the way, that is not the only thing weighing on the markets before we head to the white house here. there were some other developments out there that could have telegraphed this.

we told you about it on this show, what was going on with the housing stocks and the auto stocks when we made note last week, for example, that both were in sustained bear markets. they had gone down far more than the 10% correction from their highs to 20% or more from their highs. that doesn't necessarily always translate into other markets following suit, but it was something we were watching in the face of higher interest rates. something else to watch for now in the face of higher interest rates, retail stocks. how are they affected or buffeted by the concern here that consumer shoppers might hold off on buying things because it's getting more expensive to finance those items. it's all about what the consumer does, john, but what do you think happened? >> well, in terms of the consumer, you know, it's still a pretty strong environment. the unemployment rate as is at

lowest level since 1969. we have seen gains in stocks and home prices, incomes are rising, confidence is high so i don't think the blip we have seen in the last couple -- week or two is really enough to knock consumers off their game right now. neil: i'm wondering if an uptick in rates if it were to continue, that's i guess what the president is most concerned una, the market might do that without the federal reserve doing a thing, right? >> absolutely. you know, from the fed's perspective, nothing has really changed in the last few weeks. let's not forget the fed started raising interest rates all the way back in 2015, so their increases are nothing new at all. they announced that they were winding down their portfolio of mortgage and treasury bonds more than a year ago, so there's nothing new at all there, either. i think one of the things that's been going on in the market is that investors started to

realize hey, this economy is doing pretty well, inflation has gotten back to normal, unemployment is back at these historic lows, maybe the fed is going to push rates up a little bit higher than we already thought, and so the market is catching up to what the fed has been telegraphing for years, really. neil: the president singling out the federal reserve, you know, for getting cute with rates, loco, you heard all of that. what did you make of it? >> well, it reminded me a little of an onion headline i read back in the crisis years, that satirical online news site where they were talking about bush calls for panic. it's usually at a moment like this, you usually have the president saying everyone should just calm down, the economy is in good shape. it's kind of ironic the president is saying oh, hey, there's a real big problem with the fed right here. you know, i think that the president is pointing a lot of attention at the fed, but he's

not really in much of a position to do anything. he can't fire the chairman of the fed without cause, and he's actually appointed a number of people -- neil: i was going to ask you about that. n i know there's history for presidents not upping the fed chair. i am curious, though, what you make of the argument the president has that, you know, he can fire him but he's not going to do that midterm. can he? >> no. he's not in a position to fire him unless there is cause, some gross act of negligence. so he's not in a position to do that. powell is in the very early stages of a four-year term, so he's not in a position to not reappoint him, either, and what's so interesting is that the president has appointed a lot of other people to the fed who look like they are going to be pretty loyal to powell. i think the fed is going to keep doing what it thinks it should do based on the inflation

backdrop and the economic backdrop, and that probably means some more interest rate increases. the other thing i would say is what i find kind of puzzling about what's going on right now is that the inflation numbers, we just saw more of them today, have softened a little bit in the last couple of months, so the fed has less reason to be raising interest rates right now than it did, you know, maybe a month or two ago. the inflation backdrop has improved a little bit. so it's kind of funny to me that the bond market is getting worried about the fed at a time when the fed is probably a little less worried about the inflation environment than it might have been a month ago. neil: john, you know how people will read that. if the fed does slow its interest rate hiking, people will interpret it was cowed by the president. you can raise reasons enough that you just did that it wouldn't be for that reason, but that's what i mean by putting jerome powell, you know, in a can't-win situation. you know? >> yeah. you know, what powell is going to say and what he has said is he's just going to make the best

call that he can, like an umpire at a baseball game, and he's not going to pay attention to the politics. you know, the fed is going to raise interest rates again in december in all likelihood. i don't think we are going to know until sometime early next year, probably around march, if the fed is close to stopping. this is going to be a debate we will be having for a few more months. neil: thank you, my friend. always good chatting. i want to bring up this same subject with my buddy, you know him and i know him, charlie gasparino. hypothetical. >> he can fire him. john is an expert -- neil: let me ask you this. how would the market react to that? >> probably not well. congress might not react well. listen, the founding fathers put all these things in place, all this vague language, and when the federal reserve was created, it came much later, there was some vague language that you could fire a fed chair for ca e cause. donald trump could say my cause is he's destroying the economy,

my belief, he's hurting my economic agenda, and i will fire him. the remedy for preventing that from happening is impeachment, obviously. it's a political remedy. vote him out of office or impeachment. but he can fire him for cause, and he could fire him. just as he fired james comey for cause. neil: you know what's weird about this, the stuff he is saying about the federal reserve today is the stuff he demanded from the federal reserve when he was running for president. >> it's total b.s. the bottom line is this. the federal reserve, they bought so much -- they lowered interest rates so much, they did so much quantitative easing, buying assets from banks to help propel the banking system and to keep long-term interest rates low, that at some point they have to normalize. why? because people will think our dollar, our credit, is bad money unless there's some standards. you just can't have a federal reserve balance sheet the size it is and for people to say well, the u.s. currency is actually worth the dollar it

says it's worth. that's the problem he has. the other problem he has is he just can't keep interest rates this low for a long time. you develop asset bubbles. the stock market might be an asset bubble. doesn't mean the economy isn't doing great, but there's a debate right now saying a big asset bubble is the stock market, dow 26,000, i forget what the s&p is trading at. it needs to be lower based on because it's been puffed up by unusual factors like incredibly low interest rates which forced the marginal investor into stocks instead of interest rate bearing -- neil: let me ask about one thing that's in a way getting in the way of making this worse, that because we are in earnings season, you have to be very careful, insider selling and all that. >> you can't say anything right now. neil: right. in a way, that mitigates the potential damage or delay it. >> there's no buy-backs right now. you can't -- we are in a blackout period until the earnings come. when are they coming? in a couple weeks, we will be getting them. so now's a good time -- that's why, listen, i love david stockman, i just think the

doomsday scenario is wrong. that doesn't mean there isn't problems with this economy. follow the auto sector. i have been following tesla. gm, ford, all those companies are not doing that well right now. why? higher tariffs. the tariffs are starting to impact the bottom line. neil: and higher rates. >> it's harder to finance. neil: people can't buy cars cash like you do. >> especially when i spend $15,000 for my car. not the $70,000. neil: can i get back to what insiders can and cannot do? explain why that could be a question. >> well, the s.e.c. has a blackout period so they are basically saying we don't want you to give guidance before your earnings because we don't want you to mislead people. we want the earnings to speak for themselves. on top of that, you can't do real major corporate events. you really can't do a stock buy-back. companies can't go into the market -- neil: insiders can't willy-nilly buy and sell, right? >> it's hard. you will get in trouble. you could get nailed for insider trading if you know what your earnings are going to be. most of these companies kind of have a great idea what their earnings are right now.

for the third quarter. you can't do anything. so there's no guidance. we don't know if earnings are great or not. they are probably going to be pretty good. they can't buy back stocks. so what do you trade off of? the dow and stock investors are trading off interest rates, not guidance on earnings. they are trading off tariff fears. they are trading off other things and they may even be taking a break, you know what i'm saying? maybe getting -- neil: sometimes it's an excuse to lock in gains. >> particularly on fang stocks, facebook, apple, the tech stocks. neil: what do most of the guys you talk to, what are they doing in general? obviously they hear from their customers, people get nervous. what are they thinking about all this? >> listen, this is not -- it's not a science. it's an art. everybody has his opinion. what they tell any investor to do is not listen to trolls on twitter. there's a lot of investment

advice from the guys that say they run money and they don't, so stay away from this. what they're saying is we have to wait and see. it's not a good time to get in right now. it could be a real puke that could last awhile, and you just have to see where this thing shakes up with corporate earnings. one other thing that's a problem for corporate earnings. they may be good for the rest of the year, but then next year, are they going to be scaled down, does the economy slow next year, do the tax cuts not have the intended impact we thought they had. does the deficit balloon out because they didn't produce enough gdp. those are all longer term scenarios. short-term, just be careful. i don't think the bull market is over yet. at least i hope the consensus i hear. neil: thank you, buddy. we are waiting that pool feed from the white house, the president meeting with among others, kanye west. >> i can't wait for his take. neil: more after this. the dow down about 100 points.

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neil: all right. we are monitoring the president, by the way, with kanye west. here's the deal on that.

a lot of you have been e-mailing when are we going to see this. kanye is saying very nasty things and using foul language so there's a delay to that. we are concerned about that. we know a lot of very wholesome individuals listen to this show. not that there's anything wrong with occasionally getting salty but we want to make sure we provide clips to you free of that, because, well, we watch our language here. in the meantime, we also watch how we're treating iran here and we are getting very, very tough with those who want to continue doing business with iran in its sneaky way. edward lawrence has details on what the administration is trying to do. reporter: exactly. the treasury department just issued the most comprehensive advisories ever given to banks around the world as well as financial institutions about iran and their deceptive practices to get money. senior treasury official says iran is using front companies, private individuals, even their central bank officers, to pose as legitimate bank customers to do transactions and use the profits to finance their illicit

activities. the administration putting those banks and institutions on notice that they will fall under sanctions if they let this activity continue. the advisory urges upgrades to financial systems around the world to detect these types of transactions. a senior treasury official says the treasury secretary will be very aggressive in imposing sanctions on other countries, central banks or companies that let this activity continue. the warning comes in advance of the snap-back of sanctions on iran that happens on november 5th. for example, treasury officials say the front companies will buy airplane parts that are then redirected to the iranian military. that official also saying iran uses the highest officers in its central bank posing as those private citizens in the precious metals market and currency market to make transactions that will fund terrorist activities in syria. the treasury department expects this deceptive activity to grow next month. neil? neil: thank you, edward, very, very much. want to get the read on this from joe lieberman who has been

an important proponent of getting tough on iran and making sure they don't find ways to wriggle around some of these stringent sanctions and the like and make sure nobody hops on board to help them out in so doing. he's the former connecticut senator, vice presidential candidate with al gore in 2000. senator, good to see you. >> you, too. good to be with you. i'll be sure to keep my language clean. neil: don't get salty with us. on the iran stuff, what we are trying to do, obviously squeeze it from all ends. will it work? >> yeah. i think it will work. i give a lot of credit to president trump, the administration, they really turned this whole situation around. i always thought the iran nuclear deal was a bad deal. we gave up most of the economic sanctions on iran for very little in return and now the president says it's not good enough, so we are squeezing them economically. that's the one way short of military action to bring them to the table to renegotiate a better agreement. i think this is really a

fascinating story, but it's not that new. not that new in terms of iran. they tried every way to skirt the sanctions. we are hurting them now economically and their people are very restless generally against this regime. there's a moment of opportunity. i still think iran in a very unsettled world is the biggest threat we face. neil: yeah. you were saying that the last time you were here. let me talk to you, you mentioned the president. of course, he has been speaking out about this selloff, saying it's not on him, it's on the federal reserve, they are getting cute with interest rates, that the policy of raising rates was loco, crazy in his view, telling "fox & friends" if that continues, even earlier at the white house, talking about i'm not going to fire the guy, jerome powell, but i'm not happy about it. what do you think of the way he constantly speaks out against the federal reserve? >> well, you know, this is the donald. we don't call him the donald anymore. we call him mr. president. this is him.

he will constantly speak out. neil: if you were president, would you do that? the fear is all presidents feel this way. >> listen, what i would say is the fed is doing pretty much what i think they have to do now, which is we got a growing economy which is great. a lot of people are working. unemployment is historically low but now you got to worry about inflation which also hurts the average consumer. neil: you think the federal reserve has been raising interest rates too much? >> no. i think so far it's been methodical. but i will tell you this. the fed raising interest rates is, in my opinion, part of why the market went down yesterday. that doesn't mean that they are doing the wrong thing. it's just the market reacting to a new financial reality and i think they will come back. i also apparently, the imf report on the impact of rising

tariffs because of trade conflict, particularly between the u.s. and china, is another reason why the market went down yesterday. but i'm an optimist here. i think the fundamentals of our economy continue to be strong, and we are still at historic highs for the stock market and i think after awhile it's going to keep rising again. neil: you mentioned the imf and christine lagarde, the managing director, said among other things besides tariffs and all that, there's going to be a global slowdown. she also said about jerome powell right now that she doesn't see anything crazy about him and doesn't think that's a fair portrayal of him. >> yeah. look, many disagree with the policy the fed is following to raise interest rates, but that doesn't mean he's loco or whatever the term is, that he's crazy. i don't think he is. neil: let me ask a little bit, your name has come up as among

the replacements to consider for nikki haley at the united nations. are you interested? >> well, i don't think there's any reality to this one, really. i wouldn't use the term fake news but it's a rumor. i don't know where it began. it didn't begin with me or my wife or children. so nobody at the white house has talked to me about it. neil: you are held in esteem in the international community. you could make an argument there could be crazier picks. right? how's that? >> there definitely could be crazier picks. look, as was the case when the president last year asked me to think about becoming director of the fbi, you know, i believe in public service or as my wife would say, public service is a disease for which they have not found a cure yet. neil: you ran into grief from democrats and essentially said the heck with it, right? >> also, the president asked the senior partner in my law firm, marc kasowitz, to represent him in the mueller investigation so it would have been a conflict of

interest. look, if there was any real interest in asking me to consider this, of course i would. but i'm very happy where i am now. i'm not yearning for anything else. neil: the midterms are a little more than three and a half weeks away. lot of people are saying maybe the post-kavanaugh anger on both sides could launch that. you think this market selloff, the higher rates, could that influence it? what do you think? >> it might. the irony here is that the economy is so strong that it ought to be benefiting, you would think, the incumbent president and his party. bit seems like it's not at this point. and you know historically in the midterm elections, the out party, which would be the democrats, do better, particularly when the president's popularity is under 45% or 46% which president trump's is now.

so my guess is if the election were today, the democrats would take the house and it would be pretty close in the senate. the odds still favor the republicans to maintain a majority in the senate. neil: and maybe build on it in the senate. >> possible. possible. neil: all right. very good seeing you, sir. senator joe lieberman. all right, we've got the update on hurricane michael and the damage to that region, apparently a little more than we thought earlier. not florence, hanging around a long time, but for the brief time he hit, he sure did a lot. i mean a lot. after this. i don't know what's going on. i've done all sorts of research, read earnings reports, looked at chart patterns. i've even built my own historic trading model. and you're still not sure if you want to make the trade? exactly. sounds like a case of analysis paralysis. is there a cure? td ameritrade's trade desk. they can help gut check your strategies and answer all your toughest questions. sounds perfect. see, your stress level was here and i got you down to here,

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you know, people expect that if you're black, you have to be democrat. i've had conversations that basically say that welfare is the reason why a lot of black people end up being democrats. they say first of all, it's a

limit to an amount of jobs. >> what i need liberals to improve on, if he don't look good, we don't look good. this is our president. he has to be the fliest planes, the best factories and we have to bring jobs into america because our best export is entertainment and ideas but when we make everything in china and not america, then we're cheating our country and we're putting people in positions to have to do illegal things to end up in the cheapest factory ever, the prison system. >> i'll tell you what, that was pretty impressive. neil: all right. the president certainly liking what kanye west had to say about the automatic locked-in position on african-americans, always voting democrats and repudiating

republicans. he stands out certainly within the entertainment community saying the president is not such a bad guy, he's doing a good job, we should support him, it's good for all of us if we do. independent womens forum analyst patricia lee, what do you think of that? >> i thought he was very candid but very on point in a lot of ways. i'm glad that he's sitting down and talking to president trump about manufacturing in particular and highlighting that despite all the great jobs growth even among the black community, there are still pockets where unemployment is high. he spoke about chicago at one point, you know. 15% unemployment for black unemployment last year and when you look at 20 to 24-year-old males you are talking about a third, 37%. i think he recognizes if you bring manufacturing to places like south and west chicago, where manufacturing was from 1900 to about 1960, that is going to be a great place for blacks to get back to work, particularly those who don't have a college degree and those

who have been out of the work force and need the skills that can put them back to work. neil: you know what's kind of interesting, i'm curious to get your take, there was a time when kanye west said of president bush he didn't care about black people, the mainstream media loved the guy. now that he's made favorable comments about this president, they think he's nuts or crazy or out to lunch. what do you make of the different treatment? >> well, he was speaking to a tune that they liked back in 2004-2005. i think -- i don't know if he still agrees with what he said back then about president bush, but with hindsight he recognizes there's a reason why the president flew over katrina. however, today he seems more liberated and i think that's an important message and signal to other independent blacks who are too shy to be able to come out and speak and say you know what, actually i think what the president is doing for our communities. i like the fact that despite all

the celebrities that ran through the obama white house in the past eight years, none of them really did anything, had any specific agenda or platform that would deal with some of the issues in the black community from criminal justice reform to employment. i give him a lot of credit for what he's doing today. neil: real quickly, he gets the dismissive treatment of the media, as do many african americans who express an affinity or even a complimentary thought about this president or a republican in general. i'm wondering why that is and even as the president likes to point out, look at black unemployment at record lows and all this, that it persists and that it will still be a monolithic democratic bloc with very few exceptions. why is that? >> you know, black folks are very connected to their identity. kanye mentioned that a couple moments ago, where the left is very attuned to the fact they

said blacks, we care about our identity whether it's race or even immigrant status so it's very easy to pivot away from what's really important, the issues that are dealing with your community, to oh, this person is racist or oh, this person doesn't like you because of the cloolor of your skin and suddenly you block out everything else. you block out the facts and the truth. he's trying to highlight that and say wait a minute, it's not just about racism here. racism is really, when you think about it, ensuring that policies don't benefit your communities. this is an administration under which we have seen black unemployment drop to historic lows. now this is an opportunity to even dig deeper and again, hit those pockets where unemployment still remains high in the black community. we have not seen black leaders be able to do that with any of the policies, the progressive policies that are meant just to be handouts rather than long-term sustainable hand ups. neil: all right. well said. good seeing you again. we are following the market,

down about 166 points. there is an interesting development here that could mitigate the damage. i stress could. we are in earnings season. a lot of company insiders are forbidden to sell their stock or do anything out of the ordinary here that might be seen as taking advantage of insider knowledge. that constriction at this third quarter earnings period where maybe companies will start announcing how they did in the prior quarter, is actually going to work as a salve on the market. that is potentially the case. we will keep an eye on that. welcome to the place where people go to learn about

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and rates to fit your needs. but some give their clients cookie cutter portfolios. fisher investments tailors portfolios to your goals and needs. some only call when they have something to sell. fisher calls regularly so you stay informed. and while some advisors are happy to earn commissions whether you do well or not. fisher investments fees are structured so we do better when you do better. maybe that's why most of our clients come from other money managers. fisher investments. clearly better money management. neil: all right. we today are down more than 1,000 points over the last two days. we are keeping an eye on that. also keeping an eye on florida, surveying the damage after hurricane michael. connell mcshane on the ground in tallahassee with more on that. how are things looking?

reporter: i'm having communication trouble. neil: all right. i apologize, we are having some problem. if we can take a look what's going on with this market, because we accelerated a little on the down side here. a lot of that has to do with more sectors chiming in on the selloff. we had taken about 9 of the 11 sectors that were down, they are back to all 11 sectors down. technology again leading the rout but not as badly as before. we should also look at china and of course, any investments tied to china, how they are taking it on the chin. that index, the shanghai index, the best representative of the chinese market, is well in the bear market territory. in other words, far more than 20% from its highs, about 32% from its highs. that has spillover effect throughout much of asia that we are following on here because it includes the likes of taiwan that was down about 6% and neighboring markets down in the vicinity of 4% to 6%.

it dissipated somewhat when we extend it to europe. 2.5% to 3% declines that were later cut to 1.5% declines so they are coming off the worst levels here. also following banking and bank-related issues. they are going to be front and center tomorrow as the likes of citigroup and jpmorgan chase and wells fargo all report their earnings. they will gain more importance than ever because they are thought to be beneficiaries of higher interest rates here. now, interest rates are said to be a boon to them and not to everyone else, that's something that might be hinted at in their numbers and their earnings when they do come out tomorrow. this is the first wave of earnings and it comes to the financial sector which will be a timely development. on the financial sector, some financial rules in place post 1987 stock market crash, is insiders, company insiders have to be very, very careful doing what they're doing even if they are buying more stock, but especially if they are selling or exercising stock options that they were granted, usually low

level employees all the way up to top managers, chairmen and ceos. if it is seen that they are selling or buying based on market movement, that will be closely scrutinized so the better part of valor might be for them to do nothing. now, the flipside of that is you will see very little reason to add to the selling, because they won't be selling, they won't be feeding the beast, if you will. it's a very different dynamic than the one we had back in 1987 which could mitigate the damage from this selloff or at least spread it out depending on your perspective. more after this. making my dreams a reality

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neil: all right. welcome back, everybody. financials, the big banks getting set to record their third quarter earnings. they will get more scrutiny than morm normal, because they are impacted more than most by a backup in interest rates, but what they are limited to do in the middle of a selloff right now, they have some of the most stringent sort of restrictions on what their insiders can buy or sell during this earnings period. all companies do, but particularly the banks. now, that could work to the market's advantage or limit the selloff, if insiders can't add to the selloff. conversely, that also means they can't just start buying

willy-nilly either. the dow down about 233 1/2 points. we will take a read on the financials and energy with market watch's michelle mckinnon and phil flynn. on the finances, it's an interesting bind to be in, right? you could make the argument that limits the selloff, right? >> you could definitely make that argument. then you could also make the other argument that october 15th is tax day and that people are actually selling into this down market for taxes. it's really hard to predict exactly what's happening in terms of why we are seeing a selloff. but i'm encouraged, i think particularly with corporate earnings coming up. they are going to be outstanding and hopefully that pushes markets higher here. neil: phil, the situation with oil is interesting, because post the hurricane, you would think there would be a knee-jerk runup in energy prices. just the opposite. i'm wondering if that is easing some of the inflationary concern right now in a weird way. what do you think? >> well, i think it will.

you saw cpi today that really, everybody was supposed to be focusing on and went largely ignored. we are seeing a definite impact on prices, partly because of what's happening in the stock market, but what's happening with hurricane michael. you take a look at gasoline prices in the futures market, they are plummeting right now. on a one-day basis just from yesterday's close, they are down about eight cents a gallon in the wholesale market. why is that? mainly because of the damage of hurricane michael, people can't drive, that's going to hurt demand, supplies were up this week so it's really pushing the prices down. neil: you know, another weird thing, the president for the third day running was bashing the federal reserve today, saying, you know, it's certainly not going to be on him. i thought his rationale was the mirror opposite of what he argued during the campaign when he argued the federal reserve was keeping rates artificially low, helping barack obama. now that it's getting back to the norm he said was warranted

back then, now he doesn't like it. it just struck me as, well, hypocritical. >> trump is trump, right? there's no question about that. sometimes it's really hard to understand why he's saying what he's saying. but -- neil: we know exactly why he's saying it. he either lied then and is telling the truth now or he told the truth then and is lying now. he didn't like it when it benefited barack obama. that's fair. but now all of a sudden that it could come to his detriment, i don't know, it strikes me as weird. >> yeah. i mean, i really think the fed does not have much to do with this particular selloff, because really, when you think about the greater scheme and the greater markets in history, the ten-year is at 3%, on average the ten-year in the past 40 years has been at 6%. so on an average basis, we're not dealing with that high of yields, and if anything, yields have actually come down this week. we are almost at 3.2, now 3.1 and could go lower, particularly if we see a further selloff

here. neil: i know presidents don't like it when rates go up. they think it, they don't say it. this president says it. he's putting it out there. i'm wondering if that does put the federal reserve in a box that if it doesn't raise rates it's because he was pressured by the federal reserve or if he goes down, pressured by the federal reserve. the fed is kind of in a box, is it not? it might be slowing down rate increases precisely because of what the markets have done, but it can't win for love or money here. >> no, they can't. listen, president trump is saying that because he's in power, he knows lower rates are going to stimulate the economy even more so sure he's going to say it. i will tell you this. when president trump made a statement that he wasn't going to fire jerome powell, even though he was very disappointed in him, he's not going to fire him, the dow rallied like 100 points. neil: can you imagine, think that through. if you were to fire the federal

reserve chairman, i'm telling you t market would drop 1,000 points. be it justified or not. for him just to throw it out there i thought was like yelling fire in a theater. >> yeah. it wasn't great. i am a firm believer that the fed has to stay bipartisan and not involved in the politics and i do believe the fed will continue what it's going to do in keeping this economy on track. neil: what does that mean? i'm sorry, what does that mean? doing what it has to do? the consensus is it raises rates one more time this year, maybe up to three times next year. has any of that changed, in your view? >> no. i think if anything, if the fed did not raise rates, i think that would be more alarming, because they would be seeing things in the economy that they don't like. neil: all right. phil flynn, what do you think? >> i agree. i think we are on track. this is just a normal correction in a bull market. jerome powell, i don't think he is going to get shaken up by what the president tweets

overnight. i think he is very apolitical. i think he's the right guy for this job at the time. it's not going to shake him off his game right now. in the past, of course, a lot of people were critical of janet yellen because they believed she was politically influenced by president obama and that was the reason for the low rate policy. i don't even think that's true. i think janet yellen was a dove the whole time. neil: we'll see. i should let you know here is what donald trump said about that whole situation back on november 15th, referring to janet yellen. she's very political and is not supposed to be political. that's not the way it's supposed to work. what he's saying right now is except now that i'm president of the united states. more after this.

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neil: keep an eye on 10-year note. yield is falling. ashley webster ashley: president trump's economic advisor, larry kudlow says a possible meeting between president trump and president xi of china is under discussion. hello, everybody, i'm ashley webster, in for trish regan today. welcome, everyone, to