about ease of which they move around world and how they conduct themselves. >> real quick and then you have five seconds. of course other big question we haven't touched on is live or die that is a big question over 2018. >> great to be here. lauren simonetti, charles payne you are take it away. >> of course captain america will -- that come on hey. dagen happy new year. >> i love that you're listening. good morning everyone. i'm charles payne in for stuart a lot of big stories in the new year first, of course, is this first trading day of 2019 stocks are selling off very sharply here at the open. a lot of things but mostly it is data around world particularly in china showing manufacturing there and construction that's big, big news hitting stock big time at least at the open. take a look at this yield on tenure treasury 11th month low bond buyer people are bonds in other news government shutdown is entering 12th day but perhaps maybe a deal could be in works certainly president trump pushes

for tweeting out this morning, border security in the wall. and shutdown is not where nancy pelosi wanted to start attending our speaker let's make a deal and president trump holding meeting today with leaders of both parties at the white house this amp. can he make a deal and reopen presidents government before democrats take control of congress tomorrow we're on it. first hour of varney and the new year by the way, starting right now. moments ago bad news out of tesla now the shares set to opens lower deliveries on short company announcing 2,000 price cut on several models also let's get strawght into the markets here. we've been looking at the futures equity futures under pressure all morning long thissed a manufacturing data in china not just cooling off but now in contraction with horizon invest.

greg you know if china in contraction thing i think, bring something to the floor here that has been ignored that's china's economy slowing down not the trade war which could xas exaspe it but long before the the trade war even began. >> fully agree very good plight i think now clear sign of contraction may force chinese to deal seriously. about some of its trading abuses, i -- this morning is tbing to be rough i acknowledge that. but i think in the longer run this pushes china closer toward cry uncle and getting a settlement. also yiewrm they're manufacturing data on cusp of contraction and that's a different story because china does have the ability to goose its economy. they're sitting on over 3 trillion in fx and foreign currency and mechanisms. the message in europe, though, seems bleaker what do you make of that? >> a lot of uncertainty right now we're in london now about

finishing up holidays and nobody can give us an accurate scenario and a what happens in march. on brexit i think that kind of anxiety makes businesses less likely to invest and hire. so it is not just in the u.k. i think throughout the continent there's a feeling of malaise, uncertainty what doesn't help. >> what's going to be for you -- the more important news in 2019 there's so many headwinds right now potential headwinds that it's can you rank them in your mind for us? >> well i have to tell you i'm a lonely bull this morning. you have u.s. interest rates sharply lower and labor market red hot with wages picking up you've got virtually dormant inflation in u.s. you have a fed that doesn't want to touch hot stove again on rate hikes so i think we have a long stretch without rate hikes good corporate earnings i wouldn't use word goldly locks that could be strong but i think economy in u.s. is in surprisingly good

shape. >> i happen to share that bullish sentiment with you. but we know that initial stages at least as we come into this, into 2019 or there a lot of finishes that must be resolved you already mentioned that perhaps as china economy news, as it revealing itself more and more. you know i tell people all of the time about looking at one with year high shanghai 51% from summer 2015. how would a deal that next bit of news from china u.s. and trade what do you think it should suggest or say that might be a spark? >> i think serious negotiations there was a good story this morning. in "the new york times" talking about lighthizer others who wants trump to take a tough stance. but that story indicates that we're within a few weeks of high level talks ting these high level talks in february could yield some results. >> well, you know in appearance that president trump has taken it pretty tough stance i think this is what worries wall street a little bit those folks who

aren't politically you you you w ideologically driven and it is idea that, you know, president trump is going to to quote unquote win this -- will he accept victory will those around him except victim that happens to be one of my worries, though, what will victory look like or for president trump that he actually accepts it and we move on. >> he wantses happy stock market before his reelection heats pup so i think had he will get a deal. i think there are other things in the short run to be concerned about. i think he should try to cut a deal on shutdown of the government maybe we bring the dreamers into a package that could really be quite encouraging within a week or two. but he's got to et get a deal in next week or two maybe to obscure next big story and we all have to deal request mol per is not going e away. >> that is lingering out there like a dark cloud although idea that is taken this long -- perhaps suggest that they're struggling to find collusion although at this point some democrats are okay with campaign

opinion anything they can use to impeach or stir the pot. greg, with i want to say thank you very much and happy new year we always appreciate your insight you're one of the best. >> same to you my friend. thank you very much see you soon. all right folks it is not new but getting worse they continue to raise prices 2019 ain't any easier right? >> on average double rate of inflation so wall street journal out with a story ring aring in new year with drug prices. increases we have -- seen this similar increase over last couple of years just to put that caveat there. alerge energies on 27 different drugs we're talking drugs for alzheimer's even for dry eye. now this -- raise are as the issue charles of how the democrat presidential contenders and democrats in congress will respond. they want to reign in drug prices get the government to do more negotiating in way of medicare and medicaid and president is saying, that advertise drug companies show your drug prices in tv

commercial. so which is -- way to go. we're beginning to watch that. but again the price hike for coming this is a lyft price ahead of the rebate and discounts that you eventually get this has list price going up. >> someone will take a look at how well drug company stocks has done and a long time say weeing must continue to raise live saving drugs and things we need like extremely dry eye for instance because this is something that all americans find somewhat despicable and i'm a probusiness guy and they spent a lot of money research but you know for newer drugs that keep raise ares prices and they give president trump something by lowering older drug that's fading -- >> nothing sets people peace on edge besides high gas prices and drug prices going up. so we'll see how they response is beginning to be. drug lobby is powerful in d.c.. >> great having you back from vacation. and in politics president inviting congressional leaders to white house for a briefing on

bode wall and security this afternoon. joining us as fox contributor charles hurt with washington dimes. charles, do we get a shut did youdown deal when dust is settled and what do you think of this first nancy offer less for the border wall not more. >> i do think that -- eventually we will get some sort of deal. you know if you step back charles and look sort of at the big picture here. you've got donald trump on the side of border security, and you've got democrats you know who -- alarming number of whom are in favor of sanctuary cities and people talking about abolishing i.c.e. but big picture here i think donald trump has a very, very good hand has a very strong hand that certainly a hand that he's very happy to go into -- the new year the new congress with. you know, he likes the, you know, the big picture optics of all of that. and so i do think that in time i don't think that president trump

is going to budge much. i think that he expects to get several billion dollars worth of -- worth of his wall funding. and i think that i think eventually democrats realize that this is not a good thing. because if you think about it. in terms of wanting border security, wanting you know sol sort of sanity along border, you know, with a lot of democrats regular rank and file democrats they want that too. so i think that there's far more pressure on democrats than there is on republicans to cave. >> real quick charles what about using this opportunity for a grander deal bargain, you know, redaca wasn't go away put it in the pot get it settinged once and for all. j i think that there's a real livelihood of that, obviously, that's the kind of that i think president trump likes more than anything. he likes to grand deal question

is whether or not nancy pelosi and democrats want to kick off the new year the new congress it shall making a deal with somebody that they -- a lot of their base feels is kind of the the devil. >> you kind of hope that nancy pelosi does not -- buy too much into the media height that somehow dems controlling the house is more significant than the republicans controlling the senate and the white house. >> exactly, and a i think it's an extremely important point. but i also think that -- i think that -- something tells me that she's going to buy into that and do everything she can to use the -- her house purchase sort of a bully pulpit. thank you charles. let's attack a look at oil prices. one of the big stories also is sell loff in oil which, obviously, is a great thing for the consumer. in fact, a new look at gas prices national average for regular gas 2.the 25 per gallon is down 84 straight days. absolutely amazing. hey let's check on futures

there, now early much earlier this morning dow was off a 500 points sometimes when we open we test those deep -- really early morning numbers so that's going to be a big number to watch as markets trade on best in the last two hours maybe down 2.50 meanwhile mark zuckerberg criticized for a new year's message posted on facebook critic are are saying only focused on the positive. ignore all of the scandals and certainly all of the problems that facebook is facing. it is being called tone deaf. dramatic image from our border authorities using tear gas to stop migrant from breaking through a fence and tijuana. and far left of the dmbt party making early waves in 2020 this presidential race question is, will the wards of the world drag the party even further left going into the next election? herman cain is on it. he's next. hey, who are you? oh, hey jeff, i'm a car thief... what?! i'm here to steal your car because,

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>> quick lock at equity futures under pressure all morning long but opening underpressure for last several days and we have found many ways to rally so buckle up boys and girls i don't think we're going to end this way. meanwhile a new report that says netflix is expected to name former act a sris ceo spencer newman as new chief financial office a as early as this week. and now to politics,s there's already some buzz on who will be buying for the democratic nomination and well it really seems like the far left wing of the party is taking the spotlight joining us now herman

cain with protrump america fighting backpack herman, the warrant, sanders certainly pulling party further left no doubt about that, right? >> pulling some of the party for the left. and with the warrant with announce she's going to go to that in midwest i have a message for all of these far left socialists who claim to be democrat. that dog ain't going to hunt people in the midwest do not buy socialism. they do not believe in more government and more taxes. they believe in less government and less tax as in their lives so let them run, run, run. it is not going to do any good. >> by same token that we do see we're young democrats plane democrats have romanticized socialism that they really believe this thing and that the the newest superstars are -- are buzzing and superstars all seem to reflect this sort of

democratic socialist mantle. >> yes charles a those same ones that are responding to the the buzz about socialism and a free, free, free they have never lived in a socialist for any length of time and the casual visit as a vacationer it doesn't count they never lived in venezuela, with cuba they haven't lived there. let me give you another xasm example when in thes were selling obamacare they were talking about wonders of the government controlled health care but they never shared with the same people what was happening in britain. what was happening in other european countries what was happening in south america they were want telling people the truth so elizabeth warren and all of these other far left socialists that call themselves democrats they're going to go to midwest an they're going to be in for a rude awakening. >> by the same token you and i have talked about this before,

you know this pushback against capitalism you know as we see corporate profits i think there will be the -- mostly three quarters in a row where big corporations bank two trillion dollars. and while we see many part of the economy doing very well, you know, that almost all of these democrats no matter what side left or right side of the party, that's going to be a central issue i think hate trump capitalism corporate profits sink from the same sheet. >> i think you're absolutely right charles. hate trump is going to be elite message not going to fly in the midwest or fly in the flyover country because they don't hate trump the the way some of these, you know, big city big state liberals hate trump. i have agreed they're playing class warfare by claiming that the only ones that benefit from the tax code was a if big company as well as the rich people. well i have an announcement about big companies they have stock hold percent they are

individuals and this is what a lot of people simply don't understand which is why all a of the voices out there explaining the positive of capitalism and negative of socialism we have to ramp up our voices and our level in 2019 if not going to be easy. but it is definitely something that we are going to have to do. >> i agree otherwise we're some kind of cross roads because to your point herman people haven't lived dead set on trying it out to see for themselves how bad it can be despite the fact that evidence is overwhelming. happy new year my friend. >> happy new year to you charles. see you soon mexico new leftist president says he wants to spur economic growth to deter migration to the united states what's beginning on there ashley? it is interesting the the question is this the right move? mexican president deciding to raise the minimum wage for those states that are bordering u.s. to nine an hour that's almost double national average giving

businesses there -- a tax cut of a third of 33%. he's also reducing value added tax for sales tax as all effort to spur economic growth in northern state region ares of mexico. the the theory being is what you said charles is if it is a burgeoning economy they won't want to go to the u.s. and many are coming from central america honduras they're not wanting to travel to northern mexico to live there an trying to get into the united states. so while -- not everyone for them their economic argument is -- is mitigated somewhat if you get to northern mexico. and these opportunities are there you already speak language but they don't -- custom center so is this to agree we make that case but they don't want to stay in northern mexico they want to come across border and live in america and what america has to offer. but this is an interest move by the the mexican president and this is not what we thought it was beginning to be a lot more leftist. not a leftist move by any means check on futures realize quick.

equity futures dow jones industrial average saw 341 points also netflix -- pulling in effort for one with of its shows at the request of this saudi government we're going to explain what's going on there. next.

facebook chief mark zuckerberg tone deaf message. >> we're proud of the progress we've made we've fundamentally focus more on preventing harm in all of our services i mean if that's your opening message that's about preventing harm you're in trouble. if that's first thing that you're saying it is being criticized as tone deaf he talks about personal challenges when still there's no indication in its message he's talking about

how facebook sold our data without our consent there's he is trying to put a lock on the the door after it has been opened with all of the scandal and problem that facebook had in past year and one said stop insulting intelligence calling us users we're your product so you know, facebook still has a lot of challenge as ahead if he's coming right out of the box with this kind of -- tone deaf message, doesn't go well for, you know, seem like 2019 is any different. >> gone are long gone are days of learning new language right? >> let's switch gears a little bit here because netflix pulls a show criticizing saudis how -- well this is a show that was put on by an american comedian indian muslim background and this episode or here has a comedy show and in this episode, he criticizes makes fun of saudi arabia for trying to explain the the disappearance of jamal khashoggi we know was killed inside saudi consulate he goes

on to say in particular pep sod that they've given every reason are, the only one they didn't was a solo rock climbing accident so a lot of sarcastic humor netflix pulled this on request of the saudi government. the saudi government said that this -- this violated their cybercrime law, and netflix under a lot of pressure for doing it but they received a valid legal request we made move to comply with with local law of saudi arabia i should point out this is around rest are of the the world also available in saudi arabia on youtube i'm not sure whether saudi government will try to stop youtube from airing this episode. but as you can imagine, human rights groups are saying to netflix how do you bow it a country. censorship also i mean it is completely censorship. it shows you challenges they have that they want to grow in all of these countries they may have to, you know, do things that -- i don't think normally -- >> they're taking a lot of heat all right folks listen now dow

jones industrial average is off about 365 keeps fluctuating right in that area slowly a real tough start to the session but we've had these in last few days ended higher so buckle up more varney straight ahead. i am not for colds. i am not for just treating my symptoms... (ah-choo) i am for shortening colds when i'm sick. with zicam. zicam is completely different. unlike most other cold medicines... ...zicam is clinically proven to shorten colds. i am a zifan for zicam. oral or nasal.

folks less than a minute before opening bell and it is real tough start to session but think about every market session since christmas. we've had at least every single one of those days market was under pressure or rallies were slipping quickly. consequently, though, fended up at the close with number one biggest trading day in history in terms of points. the dow over 1,000 point followed by a session where we saw one with of the most incredible interreverse les in last hour of trade aring and then on monday a lot of people

getting ready to new yore's eve didn't notice this but dow rallied almost 200 points in russell closed at the high of the session so these sessions since christmas have been compelling with pressure to downside and buyers emerged question is will that happen what today? the opening bell is ringing you can see the first trade, obviously, under pressure dow off 316 points and future this morning we're off as of as 500 points and no winners the best you can do is unchange or they haven't traded yet caterpillar at other end all three and a half point. take a look at the wider s&p 500, index, again, under pressure down one and a half percentage points 36 point that's a big hit and then nasdaq which has been interesting because it hasn't really showed that leadership even though look it is down almost 2% all of those momentum names of the carried this market for a couple of years have been taken us lower they have become anchor consequently a massive rotation

back at the bonds. now your tenure treasury yield continues to slip to 65 there on tenure. big stocks of the news this morning tesla, those shares are getting hit pretty hard. deliveries fell short of the companies expectations and then they added on that they're cutting their prices 2,000 on three of their models. overall big tech and big momentum names again, nay let us up. let's take a look how they're fairing as opening bell is gone. i guess we'll get that up in a minute right, and then of course there are the trade sensitive stock as well caterpillar one of they will boeing but i think it is with trade on those -- also china's economy. i tell you what let's bring in the the gang. john leifield shah gilani join us ashley webster still here for all of the i think that u.s. china trade war got last year and didn't enough is china slumping economy more evidence

of that this morning. john what do you make of it because now they're manufacturing part of the economy and part is in contraction. few getting ahead of the tariffs so you saw china and up when they're talking about september, object, november and now starting to see this economy -- the true reality of that economy. and it has been going on for some time. a lot of people last year wanted to blame the tariffs on that economy going down. it didn't have much effect last year now it is helping exasperate and chinese economy is having a lot of problems. ashley. rnght i absolutely agree and then you look at europe and how we know that the last german gd reading was in contraction that's power house but that could indeed drag our economy downgoing into the new year but what if you said this charles, what if we can get something substantially done with china and what if fed takes off foot of the pedal and reduce shrinking of the balance sheet those would be e enormous for

the market. still like 2001, 2004 like one quarter of a down right we would have that last -- ten years ago. the question is, is the recession here are oil markets saying yes there's a recession. because old tech did say we're going to cut output but oil still continue to plunge 40% over the the high overs last year so oil market saying global demand is really weak? there's a global slowdown, is the u.s. recession here? you know the pundits in wall street saying no but feeling like it was over a decade ago when fed decided to raise rates for whatever reason. so it's sort of feels like that right now. >> shaw what's interesting about all of this is that -- whether it is the fed or china traitd feels like those ironically might be issues easily resolved or ones to get some steps toward resolution and some of these other issues bigger issues such as slowing economy particularly china that might be anchor that a lot of

people didn't talk about coming into this year. >> i think you're absolutely is right charles. i don't think that trade tariffs are really the focus of what the market are looking at they're looking at chinese economy. it is a succeed biggest economy in the world an used to be when united states rest of the world caught a cold now china sneezes might be doing that with pmi below that indicates a contraction that's problematic for global stock for global economies so that's a problem. as far as the fed i don't think are the fed is beginning to raise margin gotten beaten up badly and in my no reason are te last time so those issues are becoming secondary to global microeconomic picture. >> john i want to ask use about leadership. on monday, goldman sachs had a remarkable reverse are l one of the best sessions in a while that actually look like it may have hit a bottom on december 24th but also the russell. last week more money came into the russell a pretty good move

here we all know about january effect is there could there be a shift in leadership that has coat tails to carry market in absence of tech names? >> i think so charles we haven't found that yet. these drove, these drove this market in such a high regard for so long that you're trying to find that and trying to fill that void and i'm not sure where that is filled i don't think tech stocks are done, though, . you look at pox at 127 a favorite whipping boy all of the politicians like bank and oil companies were. i think it is fine i think amazon i think all a the stocks are going to be fine i'm not sure we have to find new leadership. i think right now this market is so much unserpt out there. i don't see this economy headed for a recession. not yet. not with poor employment and going from three to two that's not falling off a cliff but look at global unserpt with brexit trade war can't figure out how to price it. >> shah. shah. >> i agree essential the u.s. economy is u.s. economy is doing well i think in here charles.

i don't think there's a problem with that but global economies this u.s. markets are worried about. and if the global economies continue to contract and u.s. economy continues to model along, you can call two i would call it pretty good. i think once again u.s. stock market will be cleanest in the the laundry and investors come back into stock and there's leadership and there isn't any. what could be the leaders that's what i'm wondering it is interesting because if you look at last 15, 20 years tech is a few time but now tech must lead the way momentum name must lead the way when they don't this market seems to grapple. >> i think you hit the nail on head there tech statistically were momentum stocks not only do they have the earnings not only do they have the market not only do they have profit margin but also momentum stock and they followed them in and they followed them in through etf and those required purchase of more

momentum on top of momentum until they find some reason are to double back on i don't see market finding any leadership there isn't not the financials certainly not industrials right now so i think market will struggle here a little bit. >> that's why passive investing is a double left sword because selling is selling as it begetting buying. so you know, the theory are is that year end institutional investor were liquidating to raise cash to park it for now that's what they do at year end that drove market down and helped drive it down so question is stooct is leading indicator forecast down the road are. did it already price in the possibility of a slight downturn and then kick about up we know market history shows that after you have a down -- draft like that, the markets do post sweet returns a year or so later. so we'll watch market as leading indicator of what the market is saying about the global economy. >> i agree with that. john that it feels to a degree worst case that are joe or are

starting to be baked into this but what do you make of bearishness at 50%. now the last time it was over 50% was april of 2014. the market rallied about 13,000 point after that. so -- you know, institutions individuals and feels like there's a big orr area and negativity. >> there's a huge orr are you lk between political party this is worst of certainly i've seen i don't think it has to go back maybe to 60s to find something worse. there's so average person out there just hear hads about this government shutdown hears about trade war hears about brexit thing that are going wrong in this world and i think that's one with of the reasons that consumer sentiment was down last month i don't think true economy is that bad. we're going from 22, 23% corporate earnings to 7.8 that's a consensus 7.8 is definitely a slowdown. be that's not falling off a cliff and i don't think that we're falling off a cliff unless

we have something that is escalate unexpected which i think is a market is worried about with this trade war. >> you know, shah on this shutdown, i think people will be surprised to know that last time that market had was down, that coincided with a shutdown wases 1990. the last one we were up 1.5 a% up ten, up one with tents of a percent up 1.3% in other words it hadn't really impacted the stock market thus far. i don't know if that's good or bad if that doesn't because it doesn't initially put pressure on washington. to come up with a deal. >> that's the problem right there. because the has traditionally shrugged off closure of government of partial closure of the government. this one may be different if this government closure extends on gets uglier perhaps -- imbt other parts of government, this could be more problematic for market and right now, obviously, the president is made to the house and senate and wants to bring in leadership i hope he's successful in doing

that but sometime we need stronger border wall and protection on borders i don't know if we need a kind of wall the president is talking about but probably wouldn't hurt. but i don't know that with the democrats taking over the house if he's going to get anywhere with that. so i'm worried about a long per term government shutdown what that could do to the market. >> i should note that coming into today's session current shutdown seen it go up. happy new year thank you both very much. see you again real soon. thank charles. happy new year a quick check of the big board here. again down 355 points meandering in a place for a minute but you can believe we're going to have another volatile session as more players come back from the holidays. meanwhile the big news this morning is a slowdown in china is certainly hurting stocks today. but could it actually help when it comes to making a trade teal with china and ask one of president trump former trade advisors next, and north korea leader kim jong-un new year message for president trump he say he's not making any new

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checking big boardlet call it first attempt of the day there will be many maybe we break down 300 that might entice other fence sitters meanwhile this is amazing folks ten schools in china they have new uniforms with a very special feature what is it? >> china two years ago said we're going to have smart campus watch this ten schools in a southwest province of china the school uniforms have chips in the shoulders to track students. alarm will go off if they try to leave or skip school and alarm will go off if they fall asleep

during school. you know about they're trying to tout us say you can make cashless purchases for staying in school. nice try. but they like to say we can watch 500 time and chips will still work. this is the all seen chinese surveillance run a muck so people are going hog wild over this on internet on the media, i mean, do we want to be tracking everything that a student does? >> this is a lot scarier than it my teachers in texas thech only a paddle. [laughter] >> scary enough. until you got used to it then it was no big deal. focused on economy and to the trump campaign a lot of people were saying this news which has our markets down 300 points the dow is still good news with respect to our negotiating position with china. how do you see it? >> absolutely. look china is more dependent on exports than we are dependent on their imports. their economy is slowing down. according to some insider

information is only grown at perhaps 1% maybe even less or on verge of contracts this destabilizing their economy and destabilizes hold on power there's now growing public grumbling how he's been handling all of this. >> i will say you know, just looking at the media over there, with you know china daily south china morning post, you go through ministries of west side and then meeting with the bureau last week where tone was 180% change. all right the bombaster you know arrogance completely tboan to just that they realize this might be wise to come up with a deal. >> that's right, and maybe they're beginning to realize that having democrats newly in power is not going to help them that in in democrats like nancyi and brown from ohio outspoken

about being tough on china and they're going to push president trump to be tougher should he come to an agreement which is not sufficiently tough. they'll be criticizing him from the right because there were there was some spk lyings in dhien weigh down it president trump in 2018. wait for the midterm now maybe if you lost the senate, perhaps that would embolden china but that won't for them so what about their -- their business outlines because when this whole thing tban, you know, the -- conservative economic orthodoxy up in arms they have pitchforks they have scorches they said this never works. of course they can never explain how china became second most in the world with highest tariffs in the world i never knew how that works and pretty good for 30 years. but you know their allies are seem to be fading even wall street which is sort of been routeing for china in early stage of this, they're not as a vocal anymore about wanting trump to lose. >> that's right.

perhaps they're gipping to realize that if jobs come back to america and we start making things here again. wages will rise. and we will have our own domestic market back again instead of giving away to foreign power. >> traditional economic thinking, the post adam smith thinking could change a little bit with the idea that -- ultimately it is not about cheap goods to consumers but maybe kiewrls have been jobs initially you know maybe -- dynamic because really job never talked about about lowest cost and they talk about supply chain and they talk about -- you know, advantages and things like that. but ultimately, in a world with economics could there be a change in thinking? account with yes, we're talking what you're talking about is what president lincoln's economic advisor talked about. the goal is to raise are wages it is not to lower cheaper prices. it is raise wages if someone once said to me i don't care how cheap boots are if i don't have a job i can't afford them right so we want to raise are wages.

we want to have people making things you have to be a producer before you can be a consumer. pull tapes from cnbc in early in 2,000 or late 90s every till a company laid off a bunch of workers their stock price would go up because of this short-term thinking well with our labor costs are decreased. you have also killed your consumers too. [laughter] so -- >> i think corporate america not coming around to that. they may be forced to politically if they don't figure it all out odds or something is really good happening before this new march deadline. >> 50/50. >> still? >> yeah. okay all right is that improvement? >> i would say it's about the sail. we appreciate you coming in. happy new year. >> thanks a lot. check on dow 30 i don't know what curtis said but we got a traction here off like 2, 260 we have one stock in green these by the way is considered a -- considered a tech stock by s&p 500. so --

this is pulling us in but might be a consumer spending we saw during holiday season on other end caterpillar worst performer meanwhile searnght of defense what does that mean for our military in the new year? we're askingen insider, next. moving? that's harder now because of psoriatic arthritis. but you're still moved by moments like this. don't let psoriatic arthritis take them away. taltz reduces joint pain and stiffness and helps stop the progression of joint damage. for people with moderate to severe psoriasis, 90% saw significant improvement. taltz even gives you a chance at completely clear skin. don't use if you're allergic to taltz. before starting, you should be checked for tuberculosis. taltz may increase risk of infections and lower your ability to fight them. tell your doctor if you have an infection, symptoms, or received a vaccine or plan to. inflammatory bowel disease can happen with taltz, including worsening of symptoms. serious allergic reactions can occur. for all the things that move you.

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>> all right this is a first rally attempt of the day dow off 230 poins i told you be careful because this market has funny ways to climb up deep, deep selloffs we'll see this as another one. meanwhile i want to switch gears i want to bring in lucas tomlinson fox news pentagon producer so give us the rip the affects what this resignation. >> charles is notable that jim

mattis was not given a farewell ceremony unlike many predecessor instead he transferred authority over to his deputy patrick over the phone. shanahan is long time boeing executive spent over 30 years at the company. many team here are going to miss jim mattis but long before the nfl had the next man up, mentality if you will, the military knows all about changes of command and new leaders cooling so pentagon is certainly really to embrace patrick shanahan and outlook for the the future. >> media has made much polls out -- showing that mattis was overwhelmingly popular with the troops. of course we saw president trump visit the troops over the holidays and he was received warmly as a well. could this create any real division do you think or -- any sort of an a mousty at all? >> i don't think so charles. you know pentagon doesn't necessarily reflect the pulse if you will of the troops and the

forces especially those in the frontline and those at bases and a -- you know all across america. the u.s. military will salute smartly patrick shanahan is new leader they will carry out the plan of the day and certainly they'll embrace patrick shanahan but they'll miss mattis no question have a former four star marine general head of the u.s. central demand as defense chief but shanahan has a new agenda items to get to solve as well charles. >> me ask you and televised speech there. you know, sounded to america is not gipping to continue to res train from produce are nuclear weapon, there haven't been any major you know firing or shots. but he did say they would explore a new path america keeps up sanctions what does this mean? >> well charles you bring up a good point that's in 2018 there were no missile test or nuclear tests from north korea certainly a good sign as negotiations continue. but officials here say north

korea still is has not taken verify cial steps to scrap its nuclear program. and this annual new year's address while chairman kim said he wanted to continue to look at scrapping his so far hasn't taken steps which could want to me charles wases -- chairman kim said he wants to see the u.s. continue its suspension of joint military exercises with south kreag. and that certainly is a decision facing new acting defense secretary patrick shanahan whether or not to proceed with the drills certainly raises question about readiness of forces in asia if they're not allowed to do these -- >> thank you very much. really appreciate it. >> you bet charles if all right folks dow jones industrial off 281 points this is off a lows of the session. regular volume so volume is back as some of the big players are back. webb it is another volatile session so woo going to watch each ticket for you. meanwhile mitt romney says that

president trump has not risen to the imagine of the office a president trump responding with a tweet this morning that goes, this way -- here we go with mitt romney so fast but question is he a flake? i hope not. would prefer that he's on border security and so many other things where he can be helpful i want big he did not he should be a happy -- should be happy for all republican and be a team player and win. we're going to ask brian kilmeade about that one in next hour. more varney right after this. a. for 14 years, i played professional football and i thought my health was perfect. then i had a screening and doctor's discovered i had a serious medical issue. unfortunately, it was the end of my football career, but if i hadn't been tested it could have been the end of my life. i believe in preventive testing, it saved me. many health issues like mine have little or no symptoms. life line screening goes beyond your anual check-up

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charles: well, half an hour into the trading on this first day of the year, so far we're trying to hang in there. we have three stocks. remember i said goldman on monday was compelling, best stock of that session. now number one right now leading the dow. pretty interesting considering it got hammered last year.

joining us to discuss the market, scott shellady, tjm managing director. all right, scott, you see this, first day of the session, many people say sets tone for entire year. some people say the first month, whatever it is, how do you see so far the session playing out? how do you see it as sort of a harbinger for 2019? >> i think we're for more of the same we've had since beginning of october and rate speech from government powell on the 3rd of october. market is battered and bruised. they are looking for negative news rather than positive news. i don't like to see us overnight and get slapped when the states open up in the morning. we'll con it to be battered and volatile. charles, got wrong, when we on october third. brent crude, 80, to 100 bucks a

barrel. sometime i heard $400. i heard rate hikes next year. 10-year at 4%. guess what, you know what the tape says now. oil around 44 bucks a barrel and 10-year technically make a move now to 2 1/2. so everybody's gotten these things wrong. we've seen the algos and hfts dive in as these guys cannibalize themselves on way out of the trades. that is what we have now. battered and bruised, patch over one eye market only looking for negative news and trying to hunker down, hoping to get through it. that is the problem. charles: you mentioned algos, high frequency trading. many investors are not worried about these things they eventually cannibalize themselves and go away, i'm looking particularly christmas eve session to black monday, october 1987, trading programs played a big role then. they don't necessarily go away. how much more complicated are

they making investing for the average person? >> i tell you what, i have personally seen this, this is not act neck dote tall. there are programs, that back themselves up to ibm watson, read every tweet about every stock in the last 15 minutes of the day, give you a pretty good idea how the market is going to finish. they can take a big pipe, listen to everything in the twitter sphere, any stock that is mentioned they get a feel for that, that is how well, high-tech the artificial intelligence involved with this stuff that you've seen this kind of move into our markets and you're exactly right, the last two or three weeks we've seen a lot of that. so it is only going to be there, and give more and more especially like you said, started with 1987. i think that is a big deal. when they start to see blood in the water they are really are in addition not someone being the plunge protection team, they will add fuel to the fire. charles: what are the events early this month that could at least change some of the

psychology in the market? we know the headline stuff, trade, powell, they have garnered all the attention but this morning's pressure is good old-fashioned slowing economy, in this case china and europe? >> our economy is doing well. i think it is just fragile. i think that is the problem. i think the investors think that as well. that it could easily get knocked off course. numbers are coming through good. we'll get a halfway decent non-farm number, 150, 180 on friday. investors think things are fragile. we'll need things strengthen and sharpen up here a little bit. right now any little bad news is send ising the stock market lower. we could look at some old lows. we could see the 10-year go to 2 1/2. having said that there are still great things out there. i filled up my tank with gas in indiana, at buck 85 a gallon. nothing gets to the consumer faster than cheap gas. oil industry doesn't like to see

that but at these levels they can get by. i think yes, we'll have movement on trade. what happens when we start to see the 10-year at 2 1/2%. we have cheap grass prices, all of sudden a deal on trade, things on the horizon, you have to be careful. with negative news we had out there, best thing i can say to everybody out there, we have al goes, and traders feel that they are on hold on the negative side. they are holding the beach ball under water and any day now it could come out of the water and pop. charles: the dow and s&p are right not shadow of down 20% official bear markets and found ways to rally on successive sessions or is that inconsequential right now? >> i think it is big. there is a still a little bit of chatter out there both on the floor behind me and guys in new york, that we'll have to take a peek at the 20% level before we throw the towel in on this whole thing. the longer we say solid at these levels, more time goes by, that

will help strengthen the market. in the short term we're vulnerable, taking a peek back at those things. however i said the economy is doing well. it is fragile. we need to shore it up. we're the best looking house on the street of all the other economies and i think we'll be fine. we just need to get out of this negative cycle like we had the positive psyche for the last two years. charles: before i let you bo, scott, you mentioned jobs coming in 150, 180, where are we wanting to see them? where are we rooting for now? traders are they rooting for good news to be good news or or for subpar news, push the fed further out of the picture? >> i think they like to push the fed further out of the picture. these market rallies, equity market rallies don't die of old age generally speaking. they die because we have a screw-up at the fed. i don't like the dot plots thing. i don't like them saying we'll have four hikes next year. all that does is mud did water.

we would like to see a non-farm number that pushes the fed tutor down the road here. let them concentrate of really being data dependent. he gave a lot of lip service. charles: the dot plot is like a rorschach test. i don't even know how the hell to read it. i look at it upside down, sideways. what the heck is going on. all i know it is out there. happy new year scott, great to see you. >> good to see you. charles: we're grinding our way back. this has been the script post-express mass. we had the sessions. i love the market tested this way. it has to be tested this way if it ever to find some sort of footing. check out the 10-year yield. there is rotation back to treasurys. the yield 2.66. big tech momentum names we check for you every single morning, you can see facebook shifted. it is now higher. all the other ones slightly lower. microsoft taking the biggest

hit. could be some profit-taking still there. hey, take a look at the so-called new year's resolution stocks, mostly lower to start the year. everyone will get to the gym, we'll eat right, do all the right things. we'll see. we'll see. also big corporate news this morning, tesla down big. deliveries fell short. the company announcing a 2,000-dollar price cut. want to bring in charlie grant, "the wall street journal" heard on the street columnist. obviously not good news for tesla. what do you make of it? because it felt like they were regaining some business momentum. >> right. you know, i think the slight miss on the wall street estimates for the quarter, on their deliveries is not a big deal. tesla misses more often than not. usually their investors don't care. i think today's news about the price cuts on the cars is much more significant however. charles: was this out of left field, the price cut? >> yes, indeed.

tesla's tax incentives were set to be cut in half. 3750 from the federal government instead of 7500. tesla says they don't need incentives to sell the cars but we'll see. charles: it doesn't hurt. >> that's right. charles: people getting upset, somebody making $50,000 in des moines, may be paying for some rich millionaire in california, a tax break. >> absolutely. charles: to buy a sweet car like that. elon musk, he has been such a lightning rod. they just had the announcement, two board members, larry ellison. i think larry ellison and musk are perfect fit. they have a chip on their shoulder. ellison has gone through this before. will this have material impact on this company in the long run? >> i think realities of the car industry. not because they are bad at what they do. car business is incredibly difficult. it is capital intensive.

you need a strong economy. you need things going your way of things you can't control. almost impossible to make money in full cycle. no amount of silicon valley hype will change that. charles: want to talk about chug makers now starting out this year a lot of drug prices are being raised. talk with emac. liz: they're ringing in new year, that is the line. 6.8%, double the rate of inflation. half of allergan's inventory seeing drug price increases. seeing it out of glaxosmithkline. again what the drugmakers historyally done this at start of a year. heated political rhetoric coming out of d.c., controlling drug prices. see that out of democrats. liz warren wants own federal manufacturing plant for generics. bernie sanders is beating the tomtom drum about that. the president is saying get

drugmakers to advertise costs in tv commercials. we don't know which way is the best way to go. still whether medicare, medicaid will be forced to more aggressive is negotiate drug prices whether that will help. this is hot topic in d.c. charles: charley, you covered drug companies, they have been a pretty good investment despite president trump's rhetoric, nancy pelosi's rhetoric, alex azar's rhetoric they have been able to raise prices whenever they want. >> they have been able to. they paused a little bit when president trump made noise last summer. no one wants to show up on the twitter account is a safe assumption. from the investment point of views, price hikes are dropping. they are less frequent than they were a few years ago. charles: composition of the hikes is is disingenuous. they have cut some older drugs but newer drugs they keep hiking prices on. >> yes indeed but if they have to slow down to avoid the circus in washington i think investment

risk is actually that they don't grow earnings as consistently. charles: you know industry is in trouble when trump make as negative tweet and nancy pelosi likes it. >> 2019 should be a strange year. charles: check on the markets. under pressure this morning under china news. china trade. china's economy continues to implode. we're off the lows of the session. every time we check, more names in the green. nike joining the hit parade. we'll continue to discuss the effect on global economy. particularly china. here is another headline by the way out of china. ending freeze on videogame licenses this could be obviously massive game-changer of an industry decimated by the government over there. this might be the video of the day. texas longhorn attacked the georgia bulldog. on the sideline before the sugar bowl. it was a sign to come.

liz: run for your life. charles: texas upset georgia in the game. just as much acrimony. 28-21. coach mcadoo! you know, at td ameritrade, we offer free access to coaches and a full education curriculum- just to help you improve your skills. boom! mad skills. education to take your trading to the next level. only with td ameritrade.

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good session up $5. starting to reclaim a bit of a safe haven myth is lost for a while. then there is the big political op-ed over the weekend. this morning mitt romney slamming president trump in the op-ed. the rnc chair is responding. ashley: ronna romney mcdaniel says in response to editorial of mitt romney, potus is attacked and obstructed by mainstream media, democrats 24/7. for incoming republican freshman senator to attack @realdonaldtrump first act feeds what the democrats and media wants and is disappointing and unproductive. charles: that is her uncle, right? ashley: i believe so. laying down the law. charles: he is a freshman senator. ashley: oh, yes. liz: usually attack on the way out, not on the way in. the president's tweets have been problematic. that is what critics say.

shooting both his feet off despite policy advances. charles: talked about criminal justice reform. liz: president's personal attacks are unprecedented in history of this country. takes a lot basically to stomach that. 2019 do we want more of that. do we want policy successes. with personal attacks critics say have to stop. charles: although, you know what? this gentleman being a gentleman is nice, i like that. but i also like 400,000 more manufacturing jobs. liz: understood. charles: i know a lot of people, a lot of black people who thought they would never get a job again. liz: that is great. stay positive on that. don't make yourself irrelevant by demeaning yourself with personal attacks consistently in your tweets. that is what his supporters are saying. that is, it has to stop. ashley: romney picked up the phone aired out the concerns directly? charles: romney knew what he was doing. i just think he is playing to the same audience that called him racist, misogynist, out of touch person when he was running for president.

he is falling into a trap. but it won't end, folks. by the way what is ending in china, the freeze they had on video game licenses, like tencent. bring in gamer world entertainment news host, captain rob steinberg. rob, china really went hard at the industry this year, last year, rather, really crushed many of these names. crushed them in the stock market and otherwise. what do you think is now shifting this, and does it come with strings attached? >> that is a great question, charles. so from what i've seen, they just recently lifted this ban that allows for more games to be licensed in china. that being said we have only released about 80 games that were there. in that there are 3,000 games they brief will get get released in 2019. 7,000 games are on the wait list. wasn't much of a surprise

tencent's "fortnite" was not in the first 80, but what there says, enormous market a market that takes up $34 billion in the gaming industry, opened up to the possibility of having these games enter that market. charles: rob, we know the size is phenomenal, but you know, just for me on the outside looking in, i believe this has something to do with president xi looking around the world, particularly what started in japan over 10 years ago, the grass eaters, young men uninterested in anything. they don't want to go to work. they don't want relationships with the opposite sex. they want to sit in the basement and play videogames all night long. it had an economic impact on that country. it is the oldest country in the world and their economy is collapsing. you have an authoritarian like president xi. he wants to sort of make sure that doesn't happen in this country, seems to me? >> it, i think you're correct. so the gaming ban is really put in place by the government to try to protect its people.

they're very strict when ever it comes allowing things that might show anything that is illegal or immoral or violent or anything like that. that being said, they have gone very, very hyper as far as the amount of control they put over these games. in doing that they have lowered their i guess like, economic ecosystem, when it ever comes to gaming has been lowered by 5.4% as of last year. so it has definitely had a huge impact. and i believe, listing the console ban and allowing the more games come in to help them create more money. it is great for us year. in case you haven't invested in tencent. this is fantastic time to consider getting into the game knowing they win open up to a huge market if they can break through and if "fortnite" becomes popular with the chinese. charles: i tend to agree. watching the games like a hawk. they are oversold.

thank you, very much. >> thank you. charles: two big stories we're following today, meeting between president trump and congressional leaders at white house and the border wall. maybe we get headlines from that for the next hour. of course your money. the market starting the new year's on a down note but trying to fight back. more "varney" after this.

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comcast business. beyond fast. charles: dow jones industrials off 155. the worst part of the preopen session, it was off 500 points. making progress. it will be another wild day i think. now the banks are cutting back on credit card perks. emac, what is all this about? liz: banks were talking about big up front signing bonuses if

you take on new credit card. thinking consumers would spend more, earn banks more in interest charges, boost fees "wall street journal" saying banks figured wrong. they calculated wrong. they game the system. take the card, take bonus fee in the beginning, get rid of the card or combine all of these different points on a credit card from other cards. so the banks are saying whoa, consumers outsmarted us. the race of cost increase for the banks, talking jpmorgan, bank of america, citi, 15% increase in costs for these cards over the last third quarter of 2018. so, that's from a year earlier. so they're saying, wow, this is financial, kind of anchor around our necks. maybe cutting back the perks on these credit cards. charles: get back to good old-fashioned toasters. liz: that's right. charles: check the price of gasoline dropping believe it or

not 84 days in a row, $2.25. president trump by the way tweeting on this on new year's, he said, do you think luck gas prices are low and falling. gas prices are another tax cut. ashley, how much money are we putting into our pocket? ashley: depends who you're talking to, when gas is 2.20 a gallon that puts a lot of money in people's pockets. americans could save total 2 1/2 billion dollars a month, charles. that is a month. others have 3 to 5 billion a month. up to 30 a year with gas prices at this level? what about average household? close to 500 a year stayed at this level. has impact on consumers. feels like they have extra money to spend. the downside, shale producers is not most cheapest way to get oil out of the ground. shale if they pull back, that could have ultimate impact on gdp growth because they're not investing in the product. it is apples and oranges.

six for one-half dozen the other every other cliche. it can put money in your pocket. scott shellady, quickest way to get more money in people's pockets is. charles: i remember when it swayed elections, important to average americans. ashley: sure. charles: netflix pulling a show off the service of a saudi government. it was critical of the sauds. we'll be back on that. dow jones industrial average off 144 points. two-ways looking at that. we're actually up 200 points from the low. halfway through the first show of the year. more "varney" next. i switched to liberty mutual

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little bit. facebook was the first one. this was remarkable reversal for amazon which seemed to found a bottom. it has been coming on pretty good. the others are still a little lower. i want to stay own markets, bring in mark luschini, chief investment strategist at janney montgomery scott. mark, stocks coming out of 2018 on a fair amount of pressure. how does this sort of set up the rest of year in your mind? to me it argues that there are a lot of knowns and unknowns out there that are speed bumps, maybe more? >> you're right, charles. the fact of the matter right now we're dealing with the unknowns than the knowns. big unknown what is happening with global growth. a last few days, couple releases from chinese government, that is official, and survey had reported that manufacturing activity in china is actually contracting. what measures they have taken so far to arrest their deceleration haven't gotten a lot of traction yet.

that is obviously blow back ramifications to other emerging market economies that source a lot of their activity into china. at the moment investors are taking their cue about concerns for global growth and other concerns related to trade, obviously fed policy, still unresolved. i expect a rough start ultimately will be resolved postively before the year is out. still put on a good year, even if we start off on the wrong foot. charles: before the year's out we would hope so, but do you feel coming into the year, a lot of these issues, maybe we're getting to the point, worst-case scenario seems baked in? certainly worse than the news so far. for instance we saw from the trade war economically, 11 billion-dollar hit to a 21 trillion-dollar economy, you know the market shouldn't be down this much? >> on that note i agree. in fact we put out a note early december 26th we thought perhaps investors were taking a worst-case scenario out look to the d rating occurred here in

the equity market given the fact while clearly earnings are set to decelerate over 2019 we expect them to still finish up 6 or 7%. you put a 13 handle multiple on forward earnings. that suggests to us we've become overly pessimistic to the prospects from stocks from here. why we want to be legging in at or below these levels. charles: what are the headlines that can turn this around in 2019? we know headlines played a big role depressing this market. what are headlines that could possibly occur that could actually turn it around? >> well, charles, the principle one among others we see any kind of movement on the negotiation around trade between president trump and president xi of china. that would put obviously a great bid into equity prices by way of knowing that it isn't going to metastasize into something more sinister. the other thing the fed

commissioners come out more communicative on dovish note. that the market baked in no further rate hikes is being acknowledged by fed officials. taking away the concern or threat they continue to hike rates into an economy that appears to be decelerating so much. not necessarily below trend clearly at this juncture, but perhaps directionally having peeked last year. charles: mark, you're optimistic about the economy. share with us if you can your growth forecast for 2019? >> we expect to still see the growth rate in the u.s. to hover above the 2% potential growth rate the fed outlined. even though we're coming out probably something on the order of 2 1/2 to 3% in 2018, while that glide path will move down toward 2% we aren't expecting anything nearing recessionary type conditions beyond 2019, making this the longest economic expansion in u.s. history. charles: what would the impact of that be on earnings?

we all have adjusted our earnings outlook. we know there is no way we could have maintained that amazing pace established last year. so earnings, where does that come up, now? >> charles, i mean i think if you're talking about two to 2 1/2% sustained growth, if you put a multiplier on revenues that should be associated with that, i think 6 to 7% earnings growth on year-over-year basis is plausible. therefore the market should adjust appropriately to that kind of earnings growth. barring something more sinister along the way, lead to advance in equity prices pretty decent, still better than alternatives in bonds or cash. charles: slower growth should not be conflated with negative growth. >> ayesterday. charles: more often than that this is the way it is reported in the media. happy new year, mark. we appreciate your wisdom and hard work you guys do over there. it's great. >> same to you, charles. charles: theresa may urging members of parliament to back

the "brexit" deal. are there new details on this? ashley: not at all. she said we can put our differences aside. good luck with that. nothing more in the uk different vice i have is as brexit. she will try it again. remember she decided not to go ahead with the vote at the end of last year but she is set to go this year on the week of january the 14th. we're week 1/2 away from her trying again. meantime she is trying to get more concessions. i say more, she has got none so far from the eu. there is a lot of questions will she get the plan to divorce the uk from the eu? will she get it passed in parliament? probably not. they go to plan b. what the heck is that? charles: they're calling -- ashley: there is a hard brexit. there are theory members of parliament won't allow that to happen. then what happens? maybe we're looking at second referendum or other issues. maybe an extension not to leave on march 29th. all sorts of options not very

palatable to those people that voted to get out of the e.u. charles: you think she is doing all of this in good faith knowing she has been against brexit in the first place? ashley: she has been criticized, saying that this is the best deal she could have gotten. charles: this drama over there has had influence on our markets over here. joining us live on radio. host brian kilmeade of the "brian kilmeade show." mitt romney will start the senate momentarily. blasting president trump in an op-ed share with the audience what he had to say. oral balance, particularly actions this month is evidence that the president has not risen to the man tell of the office. what do you say to, that, brian? >> tacticallily people understand how he is different and unorthodox, blasted different people even in his own party. some. stuff in the tweets he would like to take back. senator thune, senator cornyn, man, i don't talk like that, i don't tweet like that.

they understand i have a republican president. better for people of texas, people of south dakota, for me to stay in there, hang in there, work with the president on things i agree with, which is 90% of the agenda. for governor mitt romney to about to become senator mitt romney, before he actually takes the job, to have a, to try to blast the president, tactically doesn't help people of utah. doesn't help his voice get louder or impactful. do you think that is going to help mitch mcconnell put him on key committees? do you think it will help the president say i can lean on mitt romney for international business experience, for his knowledge of tax base or infrastructure? no, no, and no. and get this, gop chairwoman who happens to be the niece of mitt romney took the president's side. the president is attacked and obstructed by mainstream media and democrats 24/7. for incoming republican freshman senator to attack donald trump as their first act feeds into

what democrats and media want and is disappointing unproductive. man, she just blasted her uncle. charles: why do you think he did it, particularly, let's face it, "the washington post," when mitt romney ran for president he was described in the mainstream media as racist, out of touch, a misogynist. he is playing to the same people that called him all of these names in the very first place. he must have a reason or rationale for doing this? >> well, i mean, he knows that bob corker is gone. jeff flake is gone. a lot of house, republican house members are gone. he might see an area which to work against. or he might say that december which was not good for the president, let's be honest, not good for the president, he might be so vulnerable letting everybody know, if impeachment proceedings move forward i'm with democrats. however i think that mitt romney, to me is continually surprised me. when he called the press conferences, when candidate

trump, just to blast who donald trump was. accept his invitation and series of interviews to become the next secretary of state. to thank the president for his endorsement in 2018, january of 2018, only to blast him on the last day of 2018? every single time, charles, he surprised me. i have liked the guy in the past. i know how smart he is. i know what he has done at 35 years old, helped more people, more families as bishop in the mormon church than most people do in lifetime. i know what kind of dad he is. i will not pretend he is not all these things. but i think it is unbelievable to me see around the corner, see more good in what the president's agenda is, in many ways it matches what he ran on. charles: brian, let me ask you about president trump meeting with congressional leaders about the wall. who at this point has the upper hand? >> i think early on until the president got that republican house, to give him, to call

nancy pelosi out say i will accept the challenge, i get 5 billion for the wall. you don't have the votes to get 5 billion for the wall out of republican house. he got it. right there nancy pelosi is at a deficit. as they stare down each other, what we saw on december 31st, with the chaos at border in san diego, that shows the president, border patrol is saying i need help. this is not rhetoric from 2016. this is an urgent need for comprehensive immigration reform and border security right away. and for them to play politics with it, i think the circumstances are playing to the president. but ultimately when they meet in the situation room and leave their cell phones out, i hope that nancy pelosi and chuck schumer understand the president already moved back off the solid wall, moved back off the five billion. is now at two billion. i think we should settle it there, move forward with a different again day, we'll see what happens. brian kilmeade, thank you very

much. appreciate it, bud. >> go get them, charles payne on fbn thanks so much. charles: listen to this, a former executive editor at "the new york times" slamming the paper saying it is too anti-trump. howard kurtz coming up on that story. also ahead, border agents fired tear gas into mexico migrants. we have someone who knows first-hand, what is going on at the border. he will be here. because with expedia, i saved when i added a hotel to our flight. ♪ so even when she outgrows her costume, we'll never outgrow the memory of our adventure together. unlock savings when you add select hotels to your existing trip. only when you book with expedia.

♪ >> i'm kristina partsinevelos at the new york stock exchange floor. let's take a look at the big boards right now and we're seeing everybody in the red. why are we seeing the catalysts for this selloff? primarily due to weakness coming out of china as well as europe. talking about the purchasing managing index or managers index, also number for united states as well, came in lower in

december then november. some losers you're seeing on the board, health care. unitedhealth, boeing, mcdonald's, johnson & johnson, travelers, usual ones once with you see trade talk in the headlines. last but not least, tesla shares down over 7%. that is production came in, sorry, delivery came in lower than expected. you're watching varney and co. stay tuned. but when i started seeing things, i didn't know what was happening... so i kept it in. he started believing things that weren't true. i knew something was wrong... but i didn't say a word. during the course of their disease around 50% of people with parkinson's may experience hallucinations or delusions. but now, doctors are prescribing nuplazid. the only fda approved medicine... proven to significantly reduce hallucinations and delusions related to parkinson's. don't take nuplazid if you are allergic to its ingredients. nuplazid can increase the risk of death

in elderly people with dementia-related psychosis and is not for treating symptoms unrelated to parkinson's disease. nuplazid can cause changes in heart rhythm and should not be taken if you have certain abnormal heart rhythms or take other drugs that are known to cause changes in heart rhythm. tell your doctor about any changes in medicines you're taking. the most common side effects are swelling of the arms and legs and confusion. we spoke up and it made all the difference. ask your parkinson's specialist about nuplazid. charles: checking the big board. this is about as good as we've been since the market opened. this is really impressive, folks. down 140. normally wouldn't think so but that is 200 points better than an hour ago. netflix pulling an episode of "patriot act." in saudi arabia. the episode mocked saudi rulers there for killing of jamal khashoggi. want to bring in media buzz host

howard kurtz. howard, do you think netflix did the right thing here? >> you know i think it is shameful that it would bow to the authoritarian rulers in saudi arabia. one of the outrageous slander does thing he said, now would be a good time in light of the jamal khashoggi murder to reassess our relationship with saudi arabia. i mean that as a muslim and american. also criticizing role in the yemeni civil war. netflix's version of this, it had to comply with legal request and probably if netflix refused, saudi arabia would have banned the whole series. a lot of companies find themselves in these uncomfortable situations but not a shining moment for netflix. charles: really isn't. underscores the fragility of these multinational, american multinationals that have to seek growth outside of this country and part of that means abandoning american principles, doesn't it? >> it does. if you're going to do business in places like china which controls its own internet, saudi arabia, some of these other regimes you're basically

making the decision more important for to you make money than to stand up for your principles. i understand the business imperative there but, i'm, i'm unhappy about it. charles: i think everyone is today, without a doubt. also want to ask you about, howard, you wrote a book about a former "new york times" executive editor who says the paper has become biased in its coverage of president trump. when referring to her successor jill abramson says, that quote, said publicly he didn't want the types to be the opposition party his news pages were unmistakenly anti-trump. howard, isn't their coverage of trump helping their bottom line? if you look at a stock chart from the "new york times," from the time president trump entered into this election, it is mind-boggling. if you look at the bottom line, they were the failing "new york times" economically. >> this is actually forthcoming book by jill abramson, called,

merchants of truth. an extraordinary rebuke from a woman who was fired from her job as executive editor four years ago from "the times," who she clearly loves and president trump coverage who she clearly does not like. you're exactly right. jill abramson said given mostly liberal audience, there was implicit financial reward, running trump stories almost all negative. big traffic with trump as president. too many stories in the news pages, not about op-ed, contained raw opinion, unmistakably anti-trump as you said. she said younger staff members at "the times," feel dangers of trump's presidency as they see it, mean that we should toss out the old journalistic standards. that is a real shame. charles: can we get them back, howard? or do economics just like the netflix situation, do economics and ideology now outweigh what used to be sort of standards?

this case journalistic standards? >> yeah i have argued again and again i think many news organizations are so wrapped up in their animus toward president trump, never giving him a break on anything. goes to iraq, find stuff to criticize, you name it. the fact, by the way it has become a good business model for certain other cable news channels and places like "the times" to run a lot of anti-trump stories, what the liberal viewership or leadership wants i don't see anytime soon. long term costs to this. has to do with credibility of the media. that will continue to a time when donald trump is no longer president. charles: i can remember readed about yellow journalism but maybe in the future they call it a win-win. thank you very much, howard. >> thank you, charles. charles: one area of the economy not booming, we know it is the housing market. the question is why, will it recover in the new year? we're keeping an eye on your money. the big board fighting back. the dow is off 138 points.

that is the best we had all morning. it will continue to be volatile. we want to see the dow fight back. more after this.

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charles: the dow continues its way back. we were down 350 points. this is pretty impressive so far. keep an eye on this. 10-year yield getting 11-month low. some economists say home prices will drop by 1% this year due to higher interest rates. joining us the founder of the real deal. amir thanks nor joining us. >> thanks for having me. charles: we did see a lot of weakness in housing last year. data, saw a lot of major disappointments, particularly middle of the year. housing prices come down, supply starting to go up.

feels like the dynamics are changing. is that good or bad? >> it is adjusting. we want housing to always go up possibly especially real estate and developers, 1% is not terrible thing. for seven years we've seen accelerated growth. you have had mortgages historically low. inventory at three decade lows which has been great. you had millenials, largest pool of homebuyers, 40% of the homebuyers are millenials. now you're facing sort of a perfect storm which is a bad thing, right? you have mortgage rates, interest rates going up, by the way we should point out, just because interest rates to up tomorrow, doesn't mean mortgage rates will to up. they will go up in the next 12 months but not be immediate. commodity prices go up which makes building -- charles: lumber,.

>> steel, lumber. that impacts foreign investment in the u.s. that has been tremendous for real estate. since 2011 to 2017 you're averaging over $100 billion in foreign investment. that has come down by 20%. that is as a result of a lot of policies coming into place right now. charles: but on other end of that though, for americans who might want dream of homeownership, policies of lower taxes, regulatory cuts, competition is of jobs, seems like there would be more first time buyers. >> there have been more first-time buyers. charles: wasn't historic norm 40% would be first-time buyers? and one of the issues feels like the lack of starter homes. average home seems out of reach for millenials. >> one of the bad things about foreign investment, they come in, do on average spend more

money than first time american homebuyers. they come in average homebuyer in the u.s. is about $240,000. the average chinese homebuyer, most of the for investment in u.s. real estate is around $500,000. that really changes things. in cities like vancouver, they put mandate, higher taxes for those sort of invests. charles: right. but still give citizenship too, right? >> pulled back. as you yaw did too. there was such a flow of chinese capital there, literally changing neighborhoods. charles: real estate is local. big metropolitan areas, benefit from some of capital flight. if you buy 100 million-dollar apartment in new york city but ever have to live there, if you have to leave the country -- >> modern day swiss bank account. charles: what about the heartland? will anything happen within the heartland? west looks like getting better and south looks like getting better? >> it is.

had good housing starts for several is years. this year expected to be 2%, only a quarter of what it was two years ago. that is lower. we'll see how that gets impacted as inventory starts to increase. charles: thank you very much. >> thank you. charles: we have two big meetings at the white house. the one with the cabinet. the other with congressional leaders. we're following developments of that, implications of your money. the dow at the best levels of the day. we're coming back again. a lot of big swings happen during the third hour. buckle up, boys and girls. getting better. we'll be right back.

.. nah. not gonna happen.

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let's talk about the market because the post-christmas recessions have been remarkable. the biggest one-day point gain in history one of the best intraday reversals as the market was on the cusp of collapse. the dow up 600. action on monday. 200 points in four minutes and now we see more appeared are we getting resolve or what is this all about that were starting to see? >> 2018 was not that unusual in terms of big losses. by contrast 2017 which is unusually calm, it felt a little choppy. we are very bullish on small-cap names, particularly two days ago. we are very bullish putting our money where our mouth is. train to the russell last week

with more money than any other etf. the russell assault was the best performer on monday. is it seasonal or just other oversold or why. >> i think they're oversold your growth is decelerated certainly appeared a lot of people look at the china deal that's not yet through. we're still having wrote them that's what investors need to recognize that we still have strong growth in the marketplace and we think they're undervalued . a few years ago we think they're attractively priced. charles: i'm not big into those metrics but those are my favorite depending on the company. sometimes when a p.e. gets too low, resend it to apple. like when a p.e. gets so low, sometimes there's multiple reasons. >> you're right. and it depends on the movement.

you look at sears and when a stock on a downward decline certainly a cbp eavesdrop or in that case nobody. but when you see companies on the fall is not necessarily a good metric. we are looking for companies still growing strong in their undervalued good research nationwide, worldwide. charles: health care down 2%. utilities down 1.8%. on the upside energy is taking off big time. consumer discretionary, trading higher. consumer services training higher. can we get beyond what was leading this market or do we still need the same names to step up. >> a lot of money with the big stocks you mentioned apple certainly driving the money. high percentages of the major

indices. certainly when money flows and it goes into the stocks first and foremost. but generally speaking this is a good time. investors sought to keep some of the dry powder for later in the year where they can put investments and this first quarter when earnings start to emerge that maybe they're not as bad as people anticipated. charles: it's definitely good the expectations are low. worse case scenario than being dug into this. that means you're anticipating some really bad things. you like emerging markets. so when you wake up this morning and see this news in china, does not worried or upset your investment? >> know when i'll tell you why. we are going to see news for you now. we know china's and beat up. down 20% plus.

charles: i'm talking the economy. the fuel emerging markets may not be allowed to do that. >> we are looking at about 5% to 10% throughout the asian markets including china, taiwan and hong kong. we've got international stocks that are strong. other companies throughout the world. so we believe if you look in the last month latin america spent not. charles: thanks, joel. happy new year. to china which is talked about the stories about their economy really tripping our stocks up at the start of trading this morning. wilmington trust chief economist. luke, is this news in china that's bad news? it didn't just begin recently. will this help us get to a trade deal faster? >> yeah, i think it's important a slowdown in china and that's

attributed to a couple different things. one, this is the manufacturing sector when we get numbers that we got overnight. it's largely about the manufacturing sector. it was already in a bit of a slowdown as they turn to a more consumer economy, but it's also definitely been hit by the trade and tariff situation. we think on the margin that does push them towards more wanting to make a deal. clearly that is better for their economy which has been hit by the trade and tariff situation. charles: we just had a guest to talk about china being down last or 20%. but shanghai is down 52% since the summer of 2015. there's been a a longer-term issues for china and they've got this huge debt dating. it seems to me they want to make a deal sooner rather than later. >> so what really is going tonight to make a deal will be

longer-term goals. they have the long-term infrastructure goals. but they are really relying on is some of the technology and some of the r&d that they don't have home grown. from some of their international partners. when we look at incentives to make a deal at little bit about the stock market and the little about the slowing economy but it has a lot to do with longer-term goal is to have that frankly they won't be able to achieve without good relations with trading partners including the united states. true to use the word learning. these partnerships were talking about and tell me if this is going to reach her were not an ultimate deal will have to be they can no longer control these jvs with majority ownership. >> right. they've made some steps towards that in the past and are starting to work towards those things. that's really the most important

part of the trade deal is about the protection of intellectual property and that is sort of the tough thing to walk here as we go forward with the terror situation. clearly we have a large trade deficit with china but the thing they are looking for is the kind of intellectual property and protection. we think they have the incentive to make the deal. and we're pretty optimistic that we'll have been although there will be some choppiness along the way over the course of 2019. charles: appreciated. ceo mark zuckerberg is catching a lot of heat after posting what some are calling a tone message at the end of the year. what are the details? liz: he's basically saying we had a good year but is getting slammed for patting himself on the back stating basically detailing his company's progress and probably its most disastrous year ever. data breaches, selling user information without user

permission or knowledge. we're proud of the progress being made and we have personal challenges going forward. this is basically a lot of topspin that is making his rhetoric and message right off the tennis court and bouncing against the wall. people are really slamming him now saying this is a thousand words again patting yourself on the back. you're sincere about selling our data without our consent. after you open that wide. one person tweet it out, not insulting our intelligence by calling us users. i've said this before. we're really your product. again, blowback. you know, this tone message that zuckerberg put out. trying to wonder if he can never get it done. this is not the first time he's been accused of being tone. let's check on the price of oil.

again i mentioned a moment ago crude oil spurting really nicely. more talk of russia and saudi arabia and some more dramatic cuts getting a nice like they are. in the meantime, national average for gasoline, regular gas $2.25 down 84 days in a row. drug prices coming up. we'll tell you why companies are deciding to raise prescription drug costs in the new year. also millions of american workers will get pay raises 21 states in 21 cities have raise minimum wages. will this force employers to hire a few workers. president trump holding a meeting with both at the white house today. can he make a deal and reopen the government before the democrats take control of congress. 24 hours to get that done. we'll be right back. ♪

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charles: an american citizen and former u.s. marine was arrested in russia charged with spying. what are the details? >> the details are few and far behind the russia isn't telling us the 48-year-old paul welland. we understand he is the head of global security for michigan-based auto parts supply. he was in moscow to attend a

wedding. we do know from russian officials the only thing they're saying is he was arrested last friday and he was caught during an espionage operation that gave absolutely no other details. secretary of state mike pompeo saying they hope to get consular access to this individual soon. they will demand his immediate return. was caught according to the russians during an espionage. charles: his brother was on "fox and friends" saying that he's not a spy. tensions are high at the u.s.-mexico border. tear gas of migraines after they tried to rush the border. border and commerce security president. images are always unnerving. they seem to heighten the anxiety and anger in this country on both sides.

where are we right now with respect to the border? >> good morning, charles. happy new year. safety is first for the border patrol. folks rushing the border are two types. those that don't want to wait in line to seek asylum or other ones that would never qualify for asylum to want to rush the border and take advantage of the situation. border patrol save hundreds of lives in san diego to brownsville on a daily basis. unfortunately, those are the things not highlighted. charles: so the job. we know the job is really tough and feels like of course public opinion at least the media has been very negative with respect to border patrol and i.c.e. ages. share with the audience the average man and woman trying to do their jobs, how much difficult has it become on the database scrutiny.

>> it is difficult because you start second-guessing yourself when you have these investigations and media and hype around things. all these people were trained to do were protect our borders, save lives and keep people safe on both sides of the border. there's no conspiracy to get somebody or hurt them one. there's no injuries when they do that. all they're doing essays stand back, and don't throw rocks at the people and just get in line. these are things happening all over the border not just in tijuana. the border patrol experiences and hats off to those guys because they are out there saving lives, keeping us safe. we've got to give the credit that they don't get enough of. charles: they certainly don't get enough of it. nancy pelosi's countering her first offer of house speaker

which is insulting for a border wall. everyone's hoping we can get some resolution here. how would you like to see this turn out? what concessions do you want to see both sides possibly make? >> this has become a political hot potato. we need to find border security, wall, technologies that go on the wall. areas that may not get a sense or physical barrier. the bottom line is technology in its become political football. they need to fund the border and look at other ways to pressure the mexican government and the central american government to discourage this massive migration of people which is simply unsustainable. if they want to save lives like they say they do because you're beto o'rourke lambasting border patrol for deaths on the border. can you imagine what will happen if they don't change the laws when it comes summertime? they need to do something now to ensure that doesn't happen in

the future again. charles: it's so sad. listen, america the beacon and everyone is born here we were blessed. so if we were born in this country we would all find a way to get care. having said that it's an arduous, dangerous, terrible journey and to bring children want is obvious he an act of desperation. i feel like these guys are saying that the coyotes come in the that happened with them, the drug cartels are overlooking that to a degree that they are actually emboldening people who make these dangerous trips beard >> that's absolutely right. but not using tools to discourage these trips cover recruitment efforts in central america. a lot of these people are lied to. they're going to guard the border, claim asylum. it's going to be very easy. that's not the case. these people get assaulted, they

get raped, assaulted. the campaign that these cartels and organized crimes have been central south heart of mexico have our unprecedented. we need to get these nonprofit organizations that want a halt to feed the truth of these people. happy new year. it's a tough job and we appreciate you sharing your own real experience with us. let's take a look at bitcoin. did not take over the world up today. at one point seemed to be threatened. that's a crypto currency. markets have sort of shrugged. of course the markets are starting to come back. liz: here with what's happening.

the cuts from opec are starting to come in and it looks like there's a drop in saudi oil acts towards. we're going to watch the dow players watching the action there. now moving sharply higher. >> up nearly $2. >> guys, a lot of people were out on monday. the dow jones industrial average was 23,147. almost 200 points in four minutes. same kind of thing with the s&p, nasdaq. russell didn't have as big of a news but it closed at the height of the session. >> 90% of the trading of algorithms. >> it was on the upside this time. there can be some legitimate bottom fishing going on.

>> the biggest 401(k) manager that more people were buying in the last. then selling. meanwhile, massachusetts governor elizabeth warren -- [inaudible] are we taking a listen to this? sorry. also making headlines, on instagram live. just one of the regular folks out there. knocking a couple back. connie west may have taken a break from politics, but he is still supporting president trump and he is are harder than ever. dow jones industrial average up right now for the session. we'll be right back. ♪

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charles: as you know, we went on the towers were going into great. check this out. the other indices are already higher and the dow rejoins them in a moment. the great confession considering where we were at the moment. by the way, is seeking of which, kanye west kicked a 2019 by reiterating his support for president trump saying one of mine many things about what the president represents to me is people can't tell me what to do because i'm black. ashley: kind of pullback from all this last october and now is doubling down. charles: i don't think he likes a political pawn. people were speaking for him, saying things he didn't say.

i think he feels like it's sort of a freedom to be able to say what he wants to say. liz: and a shed. the media meltdown. he's allowed to believe and say whatever he wants. he's seen the president trying to fix the country increased jobs and economic growth. that said he supports. that's why he's going to wear his make america great again high. i still stand by the president has great politics to fix the country. he's hurting himself. i know the president's been personally attacked. we get out. it's understood. she doesn't always need to go attacking other people via twitter. ashley: kanye said blacks are 90% democrat. they will not programming.

>> watch the super bowl. your next big battleground for successful black american entertainers. a few other people have pulled out. young kid, travis scott and credibly talented, tremendous amount of pressure. we'll see what happens. i hope he can pull a kanye and decided off. meanwhile, 2018 was in the best year for american chain restaurants. weaker sales a lot more hurdles. of course you add to that higher minimum wage which has gone into effect. zhang t-tango runs a ton of applebee's in the new york metropolitan area. meanwhile, back to the markets because maybe the dow right there. meanwhile, nasdaq picking up some steam. the question has been well momentum have to leave the market? right now the answer is yes.

more "varney" after this. ♪

charles: check in the big board. the forces of evil have reemerged there'd were trying to rally and now we are down 62 points. remember the start of the session caterpillar was the loser. an interesting session. goldman sachs had an amazing session on monday. now let's look at oil. it's like suddenly at 10:00 right after a report and of course that helps the

markets, too. by the way, i'm going to also bring in think tank. ballmer added another guy. keith fitzgerald is with us. the report just came in. do you have the details on this? >> basically that the saudi exports have been cut. the traders are now pricing in opec oil cuts and that's why oil . oil is an indicator of global demand as well. opec cuts in global demand. there is a global downturn and that's hitting our oil. there is also loans blowing up somewhere. when you see a transocean or slumber shake trending down for chesapeake are these were

highfliers during the run-up. but now they're in a world of pain right now. charles: when it gets too high, those adjustments made by the consumer in the industry. but it feels like a selloff that everyone flat-footed. >> it did and it didn't. we all knew they would do something. >> when i was talking $100 oil. >> the economy started to go the other way south. everybody slowing down. it's a fungible commodity that is dependent on the economic situation in the world today. it is so well because it's so geopolitical. charles: by the way. stay right there. i want to bring in keith fitzgerald. overall the market and we've

seen some remarkable reversals for stocks in general since christmas. should we make anything of it in your mind? >> yes, you want to ignore the noise that rest you can. you've got to take a deep bath and go swimming anyway with the best companies. you've got leverage that the long-term perspective last time i checked we still need oil in the world still needs oil. factor that in the equation you know where to go with it. charles: some of this oil story ties into china's economy. where is talk about supply and demand and what really drives by. overnight we saw china's manufacturing data, and that contraction. europe's not much better on the cusp of contraction. how worried should we be about a slowing china economy. forget about trade work for a moment. the fact the economy is not what it used to be. >> politicians want you to

believe china is a byproduct. somehow work him out on top. with this data shows you very clearly as we need china just as much as they need us. traders are hitting the reset button. traditionally that the catalyst for a sharp upside move when everybody settles down. >> i know you're bullish on amazon. why? >> amazon is one of those companies words jeff bezos. i can't imagine them as a competitor. guess what, if there is a business but big margins, you name it, five, 10 years are now it's defense -- >> how should we look at the company? is that the cloud company, retail company or a company that sells christmas trees or all of the above? >> attempting to say all of the

above. you've got a look at it as an emerging technology company. not because it's doing christmas trees. if the bridge between the retail world and absolutely personalized economic situation. >> also becoming a big player in search. happy new year. i want to bring zing back in because a lot of articles at the end of the year seem weaker growth, weaker customer traffic. of course your applebee's metro ceo in the new york area. it really obviously the first day of the year. >> i like oil in the sense that it's a delicate balance. the consumer is changing dramatically. it's more about to go, take-out,

third party delivery, uber eats. >> that helps the industry? >> we've got big boxes where you come down any. number two, what it is the margins are guided. they pay a fairly large delivery fee. we can't get additional pricing and we've got eight stops in the restaurants in sales to service people and they do enter. how do we deal with that? talking about amazon and technology and a balance between technology, the atmosphere, the good warm feeling you have when you go out front. charles: so on the cost side the big stature talking about technology takes care of the kiosk and the tablets but it still has to begin before that i

do make make a restaurant more exciting? >> that's a really good question. my view of the world is to go out to eat first and foremost without making it into an amusement park or a karaoke house. that's noise. someone just said about the oil business. forget about the noise. i focus on the food and focus on making you feel important. making you feel good. at the end of the day that's the only reason you're going to get out of that house and come into a restaurant when you can do all that at home. >> those states showing the folks on the screen. how much of an impact does not happen and this is misguided? three people getting minimum wage, did you really hope that household?

>> is a politician hopes a politician, but if you lose the job, no it doesn't help you. i know i sound like that hard to businessmen that says people should earn more money. >> let me put it this way. 4000 people when i sat here with your host, stuart varney and we have 3000 people today. charles: running the same amount of restaurants. >> running everything. more efficiently. charles: happy new year. >> thank you. you as well. charles: elizabeth warren talking about her 2020 bed in her live stream on instagram while knocking back a. -- beer. >> i want to start 2019 in this

fight. >> justice kavanagh like beer. so does elizabeth warren. >> ago she is trying to come across as the every person candidate having a beer in the kitchen. does scrape at the three-story victorian worth about $2 million. i don't know how much the common person is involved there. this is the beginning of a better life. she's trying to appeal to a certain voter out there and cracking a beer. big deal. charles: she's the first candidate. some really disappointing news before they open. delivery fell short. price cuts on several vehicle models in the united states. also, major drug companies raising prices on prescription drugs despite president trump urging them in the way he does to keep those prices lower. they're not listening mod

without coming out. a cabinet meeting taking place. just a few minutes and later this afternoon, congressional leaders attending a briefing on the wall in the situation room. were going to cover it all. we'll be right back. ♪

trantor gamer world news says the chinese government decision to allow more games in their market comes with a lot of benefits. roll tape. >> the gaming ban is put in place by the government to try and protect its people. they're very strict when it comes to allowing illegal or immoral or anything like that. they have gone very, very hyper as far as the amount of control they put over these games. they've lowered their economic ecosystem whenever it comes to gaming has been lowered by five by 4%. so it is definitely had a huge impact in allowing more to come in will help them create more money.

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charles: that counts. liz: that's right. charles: the other so we thought about his return of the mac. pharmaceutical companies raising the drug prices set to the pace of 10% or more to two dozen drugs. beating obamacare also lieutenant governor. >> already filling the sticker shock. the politicians. the democratic presidential wannabes are already gearing up making prescription drug costs. their number one issue as they come out of the box. be aware of some of these solutions, charles. elizabeth warren, for example, she wants state-sponsored pharmaceutical companies in venezuela. bernie sanders and let's eliminate patent protection.

so it's a very important issue. and of course it's a part of health care consumers feel the most. if you let the cash register only 12% of what we spend at the 12% that really bites you in the wallet. charles: but every politician, even president trump has come down hard on these companies. >> a couple he's already ruled out that i believe will have an impact this year. charles: will be ironically going the opposite way instead of getting rid of patent protection some sort of deal where you give them longer pass protection. >> you are so smart charles. the more time they have to recoup their when they sell these products. the major proposal that trump is already implementing also was direct give because the reason

they keep going up his foreign freeloading. the fact is americans consume 46% of pharmaceutical products that they provide 70% of the profit because the drug companies sell to countries like france, norway, u.k., canada that have government run health systems. they sell at such a low price it merely covers the incremental cost of the next hill. charles: crazy upside to that. >> that's right. the president has said okay we want you to price in america based on a 16 country international index for medicare. we expect you to price american consuming products according to this index. that's going to force the drug companies to raise prices overseas and that means foreign

buyers will be paying a fair share of the r&d. charles: another one for you because a judge ruled that obamacare was unconstitutional and now until the judgment is appealed. you've been talking about obamacare for a long time. but does this put it back in play to get back to the united states for another look at this? >> yes. sometime in the next year to year and a half will make its way to the supreme court. the outcome is a little iffy. what the states are aiming for, more flexibility to offer their residents a wider range of insurance options at lower premiums. the president is already accomplishing through deregulation. the number one deregulation is allowing short-term health plans to three years. they're not for everybody.

they don't guarantee coverage for preexisting conditions, but they're 80% cheaper than obamacare. in tampa, a $1100 a year for a family of three instead of over 12,000 so it's a good deal. but here is a hitch. in states run by democrats like new york and california, they are saying to consumers you are not allowed to buy this option. it's like the health insurance gulags literally. you can't have any choices. charles: wow, terrible. happy new year. happy birth day. charles: president trump holding a meeting with both leaders at the white house. details on that meeting next. ♪

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charles: president trump said to me with democrats and republicans today on the partial government shutdown and border security. blake burman at the white house with more. >> a couple high profile events at the white house today actually about 10 minutes here we expect the president will have a cabinet meeting with members of his administration. the president will sit down with the leaders of the federal government to walk through where things stand with the partial government shut down finishing its second week and where they go from here. 25% of the government shut down from federal workers hanging in the balance that are dear to them next friday. we will be hearing for the president seen him on camera and just a little bit.

this afternoon he will go into the situation room and it's scheduled at least at this point with democratic leaders, republican leaders on capitol hill for a briefing on border security. that's at least how the white house is framing it because as we know the president wants money for a border wall. yesterday on new years the president reading the following towards nancy pelosi say and border security is not where nancy pelosi wanted to start her tenure as speaker. let's make a deal. remember it was just a couple weeks ago last month here at the white house and the president sat down inside the oval office that he would carry the mantle of a government shutdown. now shifting the blame to democrats and democrats will

take control of the house of representatives tomorrow when the new congress is sworn in. nancy pelosi say she's got a plan to open up the government. shut down through the rest of the fiscal year through september and fund the department of homeland security through february 8th to give breathing room. senate republicans might not support that and president trump definitely will not support that. it continues as we are set to hear from the president for the first time and he will meet scheduled face-to-face with democrats later this afternoon for the first time since the shutdown. charles: it feels like president trump has been very subdued. he's hasn't had any really harsh words for nancy pelosi appeared real psyches extended as follows ranch on more than one occasion and we hear the white house is willing to come down from the $5 billion number. can we get to some sort of a

deal sooner rather than later? >> that's the question. there's really no end in sight how much longer this could go. both sides are incredibly dug in. the president has said he is not going to sign anything so long as there is no new money. they are both dug in. just sending out tweets, letting the new year go by. we will see him inside the roosevelt room surrounded by his cabinet than we expect the president to lay out his demands going forward as democrats have as well over the last couple days. >> we all remember later to check schumer and nancy pelosi. >> that's in the situation room.

no cell phones, no nothing. maybe a picture on twitter. >> thank you very much. appreciate it. dow jones industrial average off a little bit. i've got a feeling it won't be the last time today. more "varney" after this. . .

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charles: let's check on the market. we went into the green but now we're slipping a bit. maybe rallied too early. the volatility is with us. since christmas it has been positive. a long way to go. neil cavuto is back to take it away from here. neil: i would be remiss not acknowledging my friends connell mcshane, david asman, ably, almost too ably filling in per me while i was gone. thanks, guys. a turnaround in oil price. right now we're down 124 points after what was one of the worst years on record going back to 2018. but there are a lot of