house, what a day. sum it up for those workers that's the good news. they went through a lot. they get their back-pay. the politics of it, the president gave in. >> three weeks and negotiate a final deal. >> we could be back at it. thanks for joining us. bulls & bears starts right now. david: hi everybody. this is bulls & bears. thanks for joining us. i'm david asman. joining me is the panel today. striking a deal, that's the news of the day. the president and congressional leaders reaching a temporary plan to end the government shutdown on day 35, prompting trump to make this big announcement at the white house today. roll tape. >> i'm very proud to announce today that we have reached a deal to end the shutdown. i will sign a bill to open our government for three weeks until february 15th. i will make sure that all employees receive their back-pay

very quickly. if we don't get a fair deal from congress, the government will either shut down on february 15th, again, or i will use the powers afforded to me under the laws and the constitution of the united states to address this emergency. david: the markets holding on to their gains on the news. the dow finishing up more than 180 points, now up for its fifth straight week. that's great news and the senate just passing a bill to reopen the government. let's get the latest on what's next with our senior capitol hill producer. we heard, chad, the president say that if in three weeks there's not a deal, he's going to pull the trigger, and i guess that means that he'd go to a national emergency. >> possibly or we could have a government shutdown again. you know, the term of art you are going to hear a lot in the next three weeks is a conference committee. a conference committee is where they take members from the house

and members from the senate, they put them together in a room, and they try to reach out a unified agreement on something. this will deal with border security, immigration, daca, tps, all of those issues. and in just the past couple of moments, we have gotten the list of what we call conferees, those that will be in the room for the senate. the house will appoint their conferees when they meet at 6:30 or so. richard shelby from alabama. the chair of homeland security appropriations subcommittee, is republican senator from west virginia. patrick leahy top democrat on the committee. dick durbin and jon tester from montana, democrat, who won reelection last fall. the house at 6:30, they will take what the senate did just in the past 20 minutes, approve it by voice vote, and then this bill will go to the president for his signature and then they will announce their conferees as well. we're off to the races. a lot of the work in these conference committees is sometimes done behind closed

doors. sometimes in the old days you used to see it in the open where they would hammer out amendments and have negotiation back and forth. this is so high-profile i don't know if they actually get closer to a deal by doing it behind closed doors or do they want more attention so they can do this in the open. i have seen it done both ways. we will know very soon. those are the next steps, david. >> chad, this is morgan. as we look at what sort of leverage the president or republicans have in this negotiation, tps, these legal status, the people who are part of this tps program, which are people that come to the united states because of hurricanes, floods, war zones, those types of things, they will be losing their legal status soon, while the daca people still have their legal status, clearly their long-term viability is on the table here. what else other than tps and daca can republicans put on the table to get this wall funding and border security funding that they so greatly want? >> it is unclear. i mean, something we kept hearing from the democrats is they would try to match maybe

what the president was proposing as a dollar figure, go to 5.7 billion dollars, 5.8. it will be in the eye of the beholder. keep in mind, one wonders how far the administration can accept something that's anything short of a wall. yesterday when they said that they thought they were going to work on a three-week interim spending bill, sarah sanders, at the white house, immediately put out a statement saying we would only agree to an interim spending bill if it had a down payment on the wall. obviously because of what's moved through the senate this afternoon they have changed on that statement. i will read you a statement from a democratic congressman from michigan. i talked to him after the president spoke. he said quote i have seen people go through a hard fight and a a hard battle and then take a victory lap. i have never seen the president go to the rose garden and take a defeat lap. people are pretty clear about

who won here. >> i don't know about winning. i'm worried about the long-term cost here to the government. didn't this just permanently raise the cost for hiring for the government? who would take a government job knowing that at any point they may not get paid for a few weeks, borrow money to make payments on your mortgage. also the quality of employees, compared the private sector, who is going to be the next hires to fill these government jobs? are they going to be competent? are they going to cost more? what's going on? >> you've probably tainted that work pool. people say do i really want to go into this? they have tox fied it to some degree and weaponized this whole idea of a government shutdown. nancy pelosi said this should never be something that you take people hostage because every time there's a policy disagreement, you say we're not going to fund a government. that's why people are concerned could this happen again in just three weeks' time? or better yet could it happen at the end to have fiscal year? they are talking about government funding right now

that should have been worked out by october 30th of 2018. this is still the 2018 for fiscal year 2019. they go through this again by september 30th of this year. >> chad, the things that you set up for what they are going to discuss over the next three weeks sounds like they are going to try to do comprehensive or near comprehensive immigration reform, which strikes me as preposterous. i mean we haven't been able to do that in 20 years. does anyone really think they can do that in three weeks? >> it does seem a little fast, and that's where some say well maybe if they are getting close, do they buy a little more time somehow? again, you would have to have the president, you know, buy in on that. lindsay graham, the republican senator from south carolina was pretty optimistic and said this might be the best chance to do something big. nancy pelosi might also realize because she won big that this is an opportunity to get something really big on immigration and daca. >> uh-huh. >> remember, that they moved a bill with overwhelming

bipartisan support through the senate in 2013. 69 yeas. it would have been over 70 but there were some flight problems of getting senators in at the last minute because of some storms in washington, d.c. and the south. at the end of the day, it never moved through the house of representatives. here's something that i think is crucial to remember. when we have these crises, which we've been through, a lot of times that sets the table for a big deal, a grand bargain of some sort on whatever the issue of the day is. i would point back -- >> that's a fair point. >> i would point back to what happened with the government shutdowns in 95 and 96, between president bill clinton and newt gingrich and what they got at the oechbd the -- at the end of the day was lower federal spending. >> it's gary here. i agree with your comment. jonas said he didn't care about who won or lost. i think everyone within 5,000 miles of where you're standing right now cares who won or lost. it's clear to me that the

democrats won, pelosi specifically won. so i concur with that. i'm going to look three weeks ahead and see if my vision matches what your vision is. a, trump does not shut the government down again. he's already proven that's a losing proposition. b he gets nothing. democrats have already shown they can get away with giving nothing, life goes on. what do you think happens? >> well, one of the favorite quotes from mitch mcconnell, the senate majority leader is that there is no education in the second kick of a mule. that's something that he has used repeatedly over the years. [laughter] >> so here we are. does the president really want to go down the road, and i can only imagine the phone calls between mcconnell and the president where he's used that line on him? sometimes some on capitol hill here have indicated to me that president trump because he doesn't have experience in government, never served in state government or was a governor or senator, so he has all these things in his arsenal and trying them out. do we rattle the sabres with north korea?

what do we do with a national emergency? can i recall the congress to have state union, article ii, section 3 of the constitution? these are all different options in the tool box. he had never really tried these before. he had been through the government shutdown experience. we will see if he wants to go through it again in three weeks. >> it also seems like the emergency is a hollow threat as well. because if it was a good idea, he would have done it already. why say am i going to do it in three weeks when he has clearly shown he won't do it? >> some people have pointed to that. that was the whole idea that they had the ability to do that or they had the ability to take some of this money and move it around, they would have done it. again, you never know. options are always on the table. you never know how this could go. at the end of the day, you know, the president needs to govern. and i think that here on capitol hill, keep in mind that you have 90 plus freshmen, republicans and democrats in the house of representatives, and they want to govern. they may not agree politically, but this is a new breed of lawmaker here on capitol hill.

and the idea that they came in during this government shutdown, they are anxious to get down to doing legislation and passing bills and doing things the old fashioned way. but here's -- >> i don't think it's a given that he's not going to declare a national emergency. i think the strategy he's trying to take is it a last minute step if he has to do it. he's trying to govern until it gets to a point. we had a competitor network that had a document, a proposal of what the national emergency wording would look like. according to many people that i'm speaking to in the white house, it is still very much on the table. >> right, and he -- >> why not do it when he had the chance? >> because he's trying to govern. >> -- bipartisan -- excuse me, a binary choice. either the government will shut down or i will declare a national emergency. that might be the threat to pressure congress to actually get a deal. you know, sometimes, though, and this might amend a little bit what i said earlier, that we get to these crises and a lot of times that forces them to come to the table. keep in mind, that when we had the debt ceiling crisis in 2011,

they said they were going to have the super committee set up and were going to come up with 1.1 trillion dollars in spending cuts or they were going to have sequestration which was this mandatory across the board very harsh cuts of spending. guess what? the supercommittee failed even though they came out of that crisis and that was the agreement. sequestration to this day lives. so sometimes, you know, you don't always get an agreement, and then it has these resonances years and years later. they are still living with sequestration. david: chad, very quickly, the onus i think now is on democrats at least come up with some plan for border security. i mean, the government is open. we know what the president wants. we still don't know what the democrats want. will we know that by the end of three weeks? >> well, you know, the democrats have floated this idea of trying to match dollar for dollar what president trump had said. you know, nothing but a wall, but 5.7, 5.8, you know, billion dollars, in that area. and again, it is going to be in the eye of the beholder. keep in mind, though, i keep coming back to this, you have to

look at the make-up of the house of representatives. a lot of these freshmen come from moderate or swing districts. these are democrats. and voting for border security or something that is close to a wall or even they might say it is a wall is good politics for them. david: i hope you get this weekend off. i know you haven't had a weekend off in many weeks. at least now there's that much to look forward to at least for you. have a great weekend >> thank you. david: elizabeth warren thinks her wealth tax on millionaires will destroy wealth inequality. could it just make everyone poorer? we will debate that, coming next. but some give their clients cookie cutter portfolios.

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david: we told you about it yesterday. and today elizabeth warren making it official, proposing a so called wealth tax, designed to confiscate from the to 3 percent of the -- 2 to 3 percent of the wealth of americans. she claims it will help to reverse the inequality between the richest and poorest americans. but white house economic advisor

kudlow says the means to that end would end up making everyone poor. take a listen. >> let's just tax rich people. that's somehow going to do what? equalize income? there's no such thing as income equalizing. you can start raising tax rates on successful earners, you will get a slower economy and you will get lower revenues. david: who is right on a wealth tax, gang? >> i got to go with kudlow on this one, for a variety of reasons. you know, david, every four years, the left trots this out, and it always plays well, because it's like when you get the local proposal to build a soccer field, everyone says they are in favor of it because generally it is not in their backyard. how many people do you know out there with 50 million dollars, sure, stick it to the other guy. that's why it plays well. here's the bottom line, because the government is so inefficient, because there's so much waste, because there's so much fraud, because there's so much red tape, every dollar the

government takes from you actually has a negative multiplier effect. they take in a dollar, the rest of the country gets back about 95 cents. that's very different than when you and i spend a dollar, we get more than a dollar benefit. they are going to run this up. it always sounds great. it is the silliest argument ever. but i'm interested in what others have to say. >> i'm going to shock you in a subtle way here, gary. so first of all, kudlow did a misdirect there, you know. he said something like if you tax the rich, then, you know, everybody will just be poor. well, first of all, the suggestion isn't just to tax the rich. it is just to tax the rich on their earnings over some number, call it 10 million dollars. you can debate the specifics. the interesting thing here, gary, this is where i'm going to surprise you, because i'm so in tune with fox viewers, i think we have a survey that shows that fox news and fox business vuzers -- fox business viewers i

believe david are overwhelmingly in support of taxing the rich, which is no great shock which shows to me this is something worth discussing in a serious substantive way. >> aren't the rich already taxed, adam? they are paying all the taxes right now. >> yes, we have progressive taxation and we have gross gross egregious income inequality. what should we do about if not raise the marginal tax rate over say 10 million dollars of annual income? >> first of all, gary, there's so much to read into here. i would like to say that elizabeth warren brought this up because last week i said she was competing with aoc for attention. david: you did indeed. >> frankly aoc, 70% income tax makes a lot more sense than a wealth tax. we're not talking about an income tax. it's what the states do already by the way with property. you pay 2 1/2% of the value of your house or yacht or whatever. that's a wealth tax. the problem with it --

theoretically, they are both right. it will slow the economy and reduce income inequality by making richer people poorer. that's not a good scenario. that's what they had in cuba and the soviet union. as far as why it doesn't work, you should look at it -- the left does not see it. all the european countries have been getting rid of their wealth tax. little known fact, those protests in france are because they got rid of the wealth tax and raised the gas tax, which makes a lot of economic sense, but the public doesn't like it, which you just saw in that poll result. the problem is the whole point of the u.s. constitution is to prevent idiot policies like this, populist policy that everybody wants and would ruin the economy and send us down the path of the soviet union. in fact, what you want to tax is middle class people. that's what they do in europe to pay for all these programs. the rich, they will move, the money leaves. they will leave. it is what you can't do. they want to do it in france. it doesn't work. >> now you are insulting viewers

which neil cavuto said is always a bad thing to do. >> let's go to the politics of this. i find it interesting. i agree with what jonas just said. i think this is an incredibly shrewd political move for warren. she came out and said the argument. if you are a democrat primary voter and trying to distinguish amongst this field, there's not that many people that are officially in yet. i think this is something that gets her a lot of news. it makes her like a populist. it forces republicans to be in a precarious position, which it forces republicans to defend the ultra wealthy, which plays into the stereotype that democrats have so successfully argued against republicans for many years. i'm not agreeing with her policy. i'm just saying purely from the politics side of it, i think it is a smart play for her in the primary. it makes no sense, but that doesn't really matter. david: by the way to jonas' point, another way in liz warren ripped it off from ocasio cortez, they used the phrase

tippy top. that's the way these taxes start out. it is always going to affect tippy top and then it affects millions. >> i want to go back to something about gross inequality. >> egregious. >> egregious inequality in any society, though. someone who graduated with an f at some community college, get a job at fortune magazine. why doesn't everybody get tom cruise's roles because of inequality. it can't be that, adam. >> about 100 years or so, 70 years or so of u.s. political economic policy disagrees with you because as you all already pointed out, we already have progressive taxation in the united states and in europe and places like that. there will always be inequality. of course. not everybody can be as handsome

and articulate as you are, but government can work to shrink the inequality. >> this particular policy is very difficult to administer. i mean, this is -- david: the soviets administered it pretty well. it is called confiscating private property. >> value private businesses, value -- david: we could go on and on. we need to wrap it up. alexandria ocasio cortez is on the verge of her first battle with the banks. but will she actually be able to change how they do business? that's next on bulls & bears. all new lexus es.

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from capital one.nd i switched to the spark cash card i earn unlimited 2% cash back on everything i buy. and last year, i earned $36,000 in cash back. which i used to offer health insurance to my employees. what's in your wallet? david: 4th of july fireworks are coming early to capitol hill because this march wall street's six biggest banks are reportedly going to be testifying before the house financial services committee. now this of course is the very same committee run by bank critic congresswoman maxine waters and of course it includes far left newcomer alexandria

ocasio cortez. while it may make for good tv, will the hearings actually change the way banks do business? what do you think? >> there was a pretty good sized shakedown. there's still some loopholes that go on. i'm sure they will try to find them. but the real reason they are doing this is banks are not a brand that the public likes. some of them earned that, like wells fargo. but most of them, businesses charging late fees, overdraft fees, interest on loans, denying loans, that's the business model. you are not going to have people that like you when you do. the tech industry is the one they should be looking at, not the banks. the banks got their shakedown. if you are going to regulate, the tech industry is underregulated. banks are slightly overregulated right now. >> i agree, jonas. a lot of people are saying that, you know, there's going to be as you said all these fireworks and it is going to be this tough committee. maxine waters has been on this committee for a long time. she knows what she's doing. if anybody is looking at aoc and the interviews that she does,

she barely gets through these interviews without literally saying the world is going to end and some of the most ridiculous statements. when i look at some other things that freshmen democrats are putting on twitter, just yesterday some things that were said about venezuela, stuff that were not rooted in any sort of fact. i don't know if they don't have research teams yet on their staff. if i were jamie dimon, i wouldn't be intimidated by any sort of inquisition by aoc. >> this is one of the greatest strengths of america that our congress has these hearings with the members that this vast disparity in knowledge and opinion get to ask important people questions. you know they may not know a lot about these topics. that's not a novel concept for members of congress to not know what they are talking about when they hold these hearings >> that's true. >> they have strong opinions, so do americans have strong opinions about these things.

i think it is great. >> i will take the flip side, adam. why is it great at all? nothing happens. let's see, we've had the automakers. we've had the oil companies. we've had tech companies. now we're going to have the banks. they will walk up. there will be some fireworks. the ceos will hang their heads. they will be asked tough questions, and then they will go back and do the same things they always do. come on, adam, this is wasting taxpayers' money. >> things happen. things happen. >> what happened with -- >> with the banks industry after 08, 09. this is a long-term process. i would agree with you that each of the industries that you just cited it hasn't happened yet. that doesn't mean it won't happen. >> okay. i gave you three examples, so you are right. >> they were good ones. david: sometimes the so called experts i have questions about, i mean maxine water herself the head of the committee remember she gave a bailout to a bank

that her husband was a board member of, and it was a terribly run bank. it didn't deserve a bailout. so sometimes the so called experts can be trouble. >> yeah, i don't know if any -- look, cortez obviously doesn't know a whole lot of banking. unfortunately that's not a prerequisite to be on the committee. we don't have a lot of bankers working in congress at the end of the day. i don't think many of these people fully understand the business and how it works and how to regulate it properly. when they do create rules, it creates a lot of loopholes. they changed a lot of rules with consumer lending and credit card. the small business side is a loophole. they charge higher interest rates. they work around it anyway. they make a lot of money as you can see from the earnings this year. it doesn't work that well. some of the regulations they did were pretty good. at this point, this is more we're with you. we hate banks as much as you kind of stuff. david: i'm wondering what the

kind of trouble somebody like alexandria -- even if she doesn't know what the banking industry is like, what aoc can do? do you think there's anything she could do that could really upset the banking industry? i mean, there are other members on the committee besides her. >> absolutely. look, i think she's going to come across like, you know, larry king used to, totally unprepared, but asking the questions that everyone wants to ask. she's probably going to go in there and say why don't i get a toaster when i open my checking account now? >> gary, that is a service -- >> agree with you. >> -- to the american people. >> i agree. >> the odds are overwhelmingly stacked against one member of congress having, you know -- affecting change as it were. that's okay too. you need to -- >> i would say there's a danger to banks. she could come up with something like okay you can only charge 10 or 15 percent on loans. >> it's a fair point, and barney franks was a powerful committee

chairman who served for years. i'm just saying this is the rule of a brand new freshman. -- this is the role of brand new freshman. david: one of her points in her green plan is she believes housing is a right. that clearly would affect the mortgage industry somehow. we will wait and see what happens as the president would say. facebook ceo mark zuckerberg laying the facts on facebook out in a brand new "wall street journal" op-ed on the same day that he's hit with a report that facebook targets kids to buy internet games without their parents' permission. more facebook turmoil coming next.

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david: facebook ceo mark zuckerberg continuing to defend his company against privacy and security concerns. this time penning an op-ed in the "wall street journal" maintaining the company does not sell users' data and hinting an

openness to regulation of some kind. he wrote quote -- i heard the laugh there -- i believe the most important principles around data are transparency, choice, and control, regulation that codifies these principles across the internet would be good for everybody, end quote. a report also out this today is accusing facebook to duping kids to spend money on on-line games without their parents' permission. are the pile-on controversies just too much for zuckerberg to defend against? what do you think? >> david, i nearly spit up my coffee when i read that line that you first referenced that i snickered at a moment ago, that we don't sell our data to others. i was thinking are you stressing the tense here we don't do it but we used to do it as much as we possibly could or what? of course they do. and of course these controversies are going to keep coming because what you need to understand is this is what their business is, this thing of tricking the kids to spending

money. i hadn't seen that before you brought it up, but there's a hundred more of these because that's how facebook makes money. >> yeah, i mean, that op-ed was like he was describing some other business. it was like what? i don't understand -- >> somebody else's -- >> maybe it was the way it was like in the first year. technically i'm sure there's going to be debates in congress down the road is what does selling mean. at the very least it is access you are selling. company did quizzes to collect information on you and your friends unbeknownst to them and they sold access to that to cambridge analytica who then manipulated propaganda to change your voting. this is why the russians were interested in this product. it is powerful. that is why this guy is either misleading us about what the business is or lost control of it in all the growth as to the power they created and the temptation to abuse it for profits. >> i think there's a lot to break down in this story. you have the advertising piece, the user data piece and for me

what really spoke out is what mark zuckerberg said about supporting some sort of regulation. on the advertising piece, i mean, listen, if your kids are buying games on facebook, and they are doing it through your account, we don't need a nanny state here. we don't need a law. we don't need regulation. just get control of your facebook account and your phone. we don't need the government to police what your children buy. that's your personal responsibility. >> facebook doesn't believe that because that's why we heard news this week that they are integrating instagram and facebook, they are making it more difficult to break then up later. -- break them up later. that's the reason why they are doing that. >> sure. on the regulation side i think regulation will be coming. we should be focusing on the tech companies. getting ahead of this regulation before you have people that know nothing about social media trying to regulate it is a smart move, i think. >> i have a couple thoughts, one

i totally and shockingly agree with adam. look this is their business model. he should own it and embrace it. this is what they do to make money. this great product that is essentially free for everyone? this is how they make money. to jonas' point, facebook is more powerful than -- first of all, you really think people are influenced by the nutty ads they see on facebook to vote for president? i don't believe that at all. and finally -- >> you can prove it. it can be proven. >> hold on. hold on one second. to morgan's point, i totally agree. look, i don't understand why this is even an issue. you want to use facebook, you get the baggage that goes along with it. you don't want your data sold. don't use facebook. millions of people actually don't use facebook. i think it's okay. >> the reason why there's e-mails and advertisements is because somebody is buying it. [laughter] >> no, no, i agree with you in that regard, yes.

>> but david, in all seriousness, you know, this was one of the three things that most people thought that nancy pelosi and donald trump would agree on, you know, four weeks ago. i think monday or tuesday we will start to see serious conversations about regulation of big tech and facebook because this is a populist issue that those two sides will come together on. >> everybody wins. everybody wins. david: i have to ask adam because you are down in silicon valley there. you know it well. is it conceivable, some people have been saying there's so many problems with facebook zuckerberg eventually will go private again. is that a possibility? [laughter] >> i hadn't looked at that. i mean, it's hundreds and hundreds of billions of dollars of market capitalization. no deal a tenth of that size i don't think has ever been done. remember, he has voting control of the company. he does not have common share equity control of the company. david: right, but if it was private, he could avoid a lot of the regulatory hoops. gang, thank you very much.

>> i don't know. david: before we go to break, sources are telling fox news it's not physically possible, and that's a quote, to do the state of the union next tuesday. the date for the speech now is floated to february 5th, the following tuesday. so we will see if that pans out. but once again, fox news saying that you just can't get a state of the union together organized together for next tuesday. it will be a week after that. coming up, if you're confused by the state of the housing market, don't worry. you're not alone. we will break down some of that craziness coming next. to be nobody but yourself in a world which is doing it's best to make you everybody else... ♪ ♪ means to fight the hardest battle, which any human being can fight and never stop. does this sound dismal? it isn't. ♪ ♪

it's the most wonderful life on earth. ♪ ♪ it's the most wonderful life on earth. but some give their clients cookie cutter portfolios. fisher investments tailors portfolios to your goals and needs. some only call when they have something to sell. fisher calls regularly so you stay informed. and while some advisors are happy to earn commissions whether you do well or not. fisher investments fees are structured so we do better when you do better. maybe that's why most of our clients come from other money managers. fisher investments. clearly better money management. our grandparents checked zero times a day. times change. eyes haven't. that's why there's ocuvite.

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david: if you are buying or selling, you know this, the housing market is all over the place. home sales took a dip in december with their weakest levels since 2015. but just recently, a penthouse here in new york sold for 253 million dollars. the most expensive home sale in the u.s. over on the west coast, though, a megamansion in bel air just slashed its price from 250 million down to 150 million. hillary vaughan is joining us with the latest. >> they are calling this the eighth wonder of the world. if you want to own it, it is definitely going to cost you.

this home sales at 150 million which is what it's being listed at, if it sells that way, it will be the most expensive home to ever sell in l.a. county. in addition to the 38,000 square feet of living space, it has almost 17,000 square feet of outdoor space, and that's really the selling point here. it is the views. we're on the second level of the home, and it has an 80 foot infinity pool and wrap around hot tub that takes in the 270 degrees from downtown l.a. to the ocean. there's also a helicopter on the roof and a catamaran on the side, in case there happens to be a tidal wave that rolls through here. the property has five bars and three kitchens, and these bars are fully stocked with the highest end champagne. i want to point out my favorite feature, they have fire extinguishers of champagne full of champagne. if there's an emergency, you break the glass, and you can put out the fire with fancy champagne. david? >> well, hillary, i'm a brand

new fox news contributor, so i will take the house. [laughter] >> i dream. [laughter] >> you can't buy the fire extinguisher. >> hillary, the super wealthy houses, you know, is that really indicative of the larger market that's going on in the united states? i mean my understand is that part of the reason that the overwealthy homes are going down in price is because of the number of foreign investors that are to longer purchasing in the u.s. given the scrutiny over real estate purchases? >> well, particularly in california and in l.a. especially only 27% of people that live here can afford to buy a median income single family home here because housing prices are just really out of control here. so this is definitely being marketed to someone who probably doesn't live in l.a., probably lives outside of l.a., maybe out of the country. so right now this is definitely gearing towards the ultra, ultra luxury market of housing. but in terms of just every day

people, they are being priced out of their homes and communities here in l.a. >> here's what i want to know, and we will stick with the megamansion for a moment. some real estate agent screwed up by listing this at 100 million dollars more than where they were currently listing it. what i want to know is what it cost to build that house because something tells me they are still building in a profit margin at 150. >> yeah, i actually don't know how much it costs to build this house, but the price does factor in absolutely everything in the home. you have a lot of rare art that's hanging on the walls. we of course have a lot of very expensive alcohol, very expensive designer furniture. there's a bowling alley that's decked out in louis vuitton. so all of this comes included in that 150 million dollars. >> hillary, jonas here. if possible, could you move away from the fire extinguishers in

case elizabeth warren is watching this? we're trying to avoid a wealth tax in this country, not encourage it with this kind of show. [laughter] >> these deals are going down there, that are over 100 million dollars, are they all cash? if not, who is financing these? >> you know, that's a good question. i think it really depends on each individual sale. we've asked, you know, what types of people are coming in to see this home. they've had a lot of people stop by, but the people that can afford a house like this, they don't want to be named. so celebrities, really, really high end people have been coming through to see the house. it really depends on who ends up buying it. >> you know, i have some thoughts on this whole ultra, ultrahigh end market. when i saw that billionaire today in the "wall street journal" bought that -- the most expensive property in manhattan, it just wreaked of a market top in this high end real estate. hillary, i've seen the same thing looking through the mansion section in the "wall

street journal." these prices of these mega, you know, ultra, 100 million plus are being marked down. is there a sense out in california, even in l.a., that, you know, we've seen the top, and even that the ultra high end, there's going to have to be some dramatic price cuts? >> possibly. so this is at 150 million. and the house that comes close to that right now that has the ranking of most expensive home ever is 110 million dollars home in malibu's beach. and that right now holds the title. so this is about 40 million on top of that. so really we're seeing major cuts, but again, this is still the most expensive home. so not a deep cut compared to that. david: hillary, great report. you must have had a lot of fun covering that house today. thank you very much for being with us. appreciate it. have a good weekend. l.a. is known for its sun, so why is it saving for rain? meet the cities who are stock piling funds for the next recession, whether other cities

should be doing the same thing. oh, brad, check it out. (agent) with nationwide, you could save up to 20% by bundling your home and auto insurance. bundling home and auto. two songs in one. like a mash-up. exactly. yeah. what's a mash-up? i'm going on the bus. ..

david: your folks always told you to save money for a rainy day. america's second largest city, l.a. has stowed away $500

million. are these cities on to something? >> i think they are. but i have to be sceptical. when in the history of mankind has a government socked away money for a rainy day? the u.s. government doesn't do it. major cities haven't done it. new york city has been bankrupt 8 times. politicians want to spend five times as much as they take in. i will believe it when we hit the next recession if they can bail themselves out. >> california got scared in the last one. the federal government helped them out and they raided a lot of taxes on manyland golden geese who live in the state. i don't think the federal government will have enough money to bail out the states.

causing a worse recession. everybody needs to be doing this. it moderates the business cycle and it's what governments could be doing across the board. importantly the investor to answer the survey said they are most of nervous about valuations and central bank policies. everything we are hearing related to trade policies is not playing out. so we know the market is i chicago cal. -- is i chicag is keuchelical.

>> >> there is a government that has done this and it's the state much kastled under the recently departed jerry brown. he did build up a surplus. he said he was doing it as a rainy day fund. so if los angeles can take the example from sacramento, good for them. it is possible. david: l.a. did have a rainy day fund of $200 million in 2009, and i think it went through that very quickly. isn't there something good, though, about cities going broke? they get rid of all the dead weight when they do. they can't print money like the federal government does. >> bankruptcy is a cleansing experience for companies, too, but i don't think it's a good thing. >> i don't think the federal

governments can borrow money like they did in the last recession. we can't just assume we can barrow our way out of things. county * if we don't get a fair deal from congress, i will use the powers afforded to me under the laws and constitution of the united states to address this emergency. >> we don't agree on some of the specifics of border security. democrats are against the wall. but we agree on many things such as the need for new technology and the need to strengthen security at our ports of entry. >> the days ahead will tell us whether our democratic colleagues are serious