deirdre, my colleague and friend dan heninger being with me through this waiting period. type's up for me. we have seven seconds to go. we're waiting though. we'll wait out these seven seconds. three, two, neil, it yours. neil: thank you very, very much, stuart. we are waiting to hear from the president of the united states and 12 hours from now whether the tariffs we threatened go into effect. that is when they are supposed to go into effect. 25% tariffs, upwards $200 billion worth of goods. edward lawrence here to monitor where things stand. hey, edward. reporter: hey, neil. yeah the talks start late this afternoon. sources with the chinese say they're prepared to work through dinner related to this. that puts pressure on the timeline you talked about on raising the tariffs. if the chinese want to avoid raising those tariffs. treasury secretary steve mnuchin told me only way the chinese can avoid the tariffs going up if they put back the concessions they pulled out on the treatment and negotiate in good faith on

the last 10% that is left. this setback on negotiations clearly frustrated the u.s. trade team. sources in the ming, when the president made the decision to go forward with the sanctions or increased tariffs. he wasn't angry about it. this is stoic. he said this is the way we're going forward. this is the way we're going to proceed. house speaker nancy pelosi supports being tough on china, supports the president's chance here. democrats running for president pushing back. listen. >> i believe there are areas of concern and differences we need to address with china both as relates to trade as well as security but i think it is important we be able to address those challenges while not escalating tensions to a very dangerous point. reporter: you remember former vice president joe biden saying that china's not a threat here. now the good news in all of this is china is coming for these talks. the vice premier liu he will be here. the telling point will be

exactly what the demeanor is as he walks into the u.s. trade representative's office. in the past he has been in good mood, smiles. will be interesting to see whether the u.s. trade representative comes out to greet him. that is something started about two or three talks ago. we'll see what happens, neil. neil: have you gotten any wind, edward, looks like talks today, limited what they are, looks promising, that the president would postpone the tariffs or they are on or set? reporter: it doesn't just need to look promising for postponing increased tariffs. the chinese have to add back in everything they took out. i don't believe that will happen today. the feeling just isn't there that is going to happen. however that is what needs to happen according to our trade delegation in order for the tariffs to be paused again. neil: thank you, my friend. great seeing you. edward lawrence, he will be back on the broadcast. meantime the dow down 366 points on all of this. market watcher ben phillips, on

how bad this could get. end with you, rebecca, let me begin with you. if it turns out 12:01 a.m. tomorrow the tariffs kick in, the chinese promised they will respond, then what? >> yeah, neil this week has looked so ugly since the trump tweets on sunday and we've obviously -- monday we started to think maybe it was just a negotiating position. then tuesday we got the real deal. tuesday, wednesday, thursday, we've had some bad days here. if we have the actual tariffs go in and reciprocated in china our markets -- this will be a rough ride. it will be a rough ride until we get the best news ever, that there is finally deal. i expect the market will be down tomorrow as well. neil: do you get a sense the markets are overdoing it? or upside hint things looking good or on the downside when it looks like they're not? >> we said last friday we were talking about with other market participants this is largely

priced in with the trade deal, if it happened maybe 5% upside in the markets from the deal going through but the downside was bigger. we were saying it is asymmetric risk. downside was 25% or more if the trade talks did fall apart. they haven't fallen apart completely yet. we saw reports there may be extension with the tariffs not going into effect two to four weeks, goods in transit. that carveout. that buying the u.s. and china more time than people thinking. neil: if that were not to happen all bets are off, right? >> yeah. i think if we see this non-extension, just reports out there was potential for goods in transit not be subject to the tariffs. but if we see going full effect and taxed tariff goods already in transit, that's a problem. neil: rebecca, there are a variety of stories out there that hint of the chinese misreading us. one in "the wall street journal" given the jawboning that the president has given the federal reserve they supposedly read

into that, the chinese, that president is concerned about this recovery and lept at that as a sign he is nervous. he needs this deal more than we do. what did you think of that? >> i think this is, neil, "enter the dragon," okay? president trump is one of the best negotiators i have ever seen as a president in this kind of arena but i tell you i do think here the chinese took his tweets and tim perment, oh, he really cares about the economy t means a lot to him. he doesn't, he will not force us to the table if we walk away market will do exactly what it is doing, it will go bad. they read that in his tweets and pressuring of the federal reserve powell decreasing rates instead of pausing them. this is the dragon of the negotiate shun we're dealing with. this is the country we're dealing with. why the deal has taken since last year and isn't done and going back and forth at the 11th hour. yeah, i think trump has to watch out for what he is saying

because it potentially will be misread. neil: ben phillips "the new york times" talked about the trump trade put, that the markets figure, you know, it is a tactic he uses, dials it back, that he watches the markets quite closely. that he doesn't want to damage too much or risk too much. so that they count on him kind of dialing it back. that is the gist of it. what did you make of that? >> i think you're putting a lot on with you person. he does markets go higher. he wants to see a china deal done. if we don't get a deal done his focus will be putting more pressure on china. in the near term he knows the market is up this year. it is up a lot since elected. he has wiggle room here. he will continue with hard negotiation. this is typical brinksmanship. we have a few weeks to resolve things. then it might get ugly. neil: thank you very much, the dow down 377 points.

there is a quite to quality with bonds. interest rates slipping a little bit. 10-year note last i checked was around 2.44 neck of the woods close to 2 1/2%. we're following that as a safe haven for cash. how is president playing this out? let's go to he had rollins if it goes too far. will it endanger his own voters. the president will speak. then i want to go to you. he is meeting with people in the medical community, talking about a way to make prices transparent. >> an initiative to require drugmakers to disclose prices to consumers and it is going to be something i think very special. you may have heard about it, maybe not but it is the beginning of a plan of transparency. i think it will have quite an impact, thank you very much. that was a job well done everybody. [applause] thank you all for being here as we address one of the biggest

concerns americans have about health care. the republican party, i have to say this, is really very much becoming the party of health care. you see what we're doing. we're determined to end surprise medical billing for american patients. that is happening right now. i want to thank secretary acosta, tear azar, everybody else in the room for joining us. some people with incredible stories. thanks to senators lamar alexander, maggie hassan, bill cassidy john barrasso, representatives kevin braid city, devin nunez and greg walden. thank you. [applause] my administration has already taken decisive action to make health care more affordable for american families. we vastly expanded low cost

health insurance plans. that is happening. it has been an incredible success. we begun a bold initiative to reduce the price of prescription drugs. last year drug prices saw their first decline in 46 years. first time in 46 years, that drug prices have gone down. now they're going to be down a long way further including the fact that we may allow states to buy drugs in other countries if we can buy them for a lesser price substantially less price. that is going to be very unique. we'll allow them to go to other countries because the drug companies have treated us very unfairly and rules and restrictions within our country have been absolutely atrocious. so we will allow them, with certain permissions, to go to other countries if they can buy them for 40, 50, 60% less. it is pretty pathetic. that is the way it works. for many years drug companies gave foreign countries better deals than they gave our own country. now we're making sure that our

great seniors share in the discounts given to other countries. we will always protect patients with preexisting conditions. very importantly, republican party will always protect patients with preexisting conditions. that's the man right there. in my state of the union address i asked congress to pass legislation to protect american patients. for too long surprise billings which has been a tremendous problem in this country, has left some patients with thousands of dollars of unexpected and unjustified charges for services they did not know anything about and sometimes services they did not have any information on. they weren't told by the doctor. they weren't told by the hospitals and areas they were going to. and they get what we call a surprise bill, not a pleasant surprise, a very unpleasant surprise. this must end. we're going to hold insurance

companies and hospitals totally accountable. we're joined by families who personally experienced some horrible injustices of surprise medical business. drew and erin culver from austin, texas. drew i would like you to come up and erin, share your stories. pretty amazing story. hi. neil: we're going to continue monitoring this. what the president is doing making an effort with the drug industry, medical industry in a whole, be more transparent, let you know how much something is going to cost. many americans are very surprised going to the hospital. they think they are in network and covered for a whole host of ailments to be addressed only to get a whopping bill not only for the medications involved but some of the special procedures they thought were covered. they end up not being covered. so he is big on transparency here to make sure that is all out there for the public to

digest. the industry itself is fighting him on this saying things can change. there is no one size fits all for this. so that back and forth will continue but the president feels this is an issue that is resonating with americans. obviously one eye to the 2020 campaign of the fact that democrats were able to seize control of the house of representatives, think about it, largely pounding health care, he thinks this is a winning issue, besides being morally right one. former reagan campaign manager ed rollins here whether the president is right about that. what do you think? >> he is absolutely right. why should you buy a drug in canada for less than it is cost here when it is made here? the reality this is one of the great dilemmas when people face getting into health situations. he is absolutely right on this issue. neil: it is all for transparency and getting the word across. if you want to gouge americans, fine but you're going to go on record they're knowing it ahead of time. >> i think people want to know

that. i think, if you go to a dentist you pretty much know what you're going to pay for, tooth, root canal, you go in for surgery have no idea what it will cost you. to great extent pharmaceutical products are one of the real places -- neil: not everyone shops around? i had a heart surgeon. you charge how much for a heart operation? i had no time to shop around. how he is doing, improving poll numbers what do you think. >> poll numbers are strong. base is very strong. at the end of the day the chinese thing is very important. it's a show of strength. neil: what happens at 12:01 tonight. >> if the chinese don't basically go back where they were weeks ago on the agreements he will put tariffs in. they will have to come back to make major, major reform. he doesn't trust them. he has the support of the speaker and support of the majority leader which is unusual. my sense this is one of his

great assets in politics shows strength. to the vast majority of americans who don't watch, invest in the stock market, what happens here is really what's fair. the chinese have not been fair to this country. neil: do you think, ed, you read that the trump trade put story in "the new york times," the gist of which was he dials things back. he is a lot of bark, hoping that he doesn't have to bite. and that the markets count on that. what do you think? that he won't follow through? that something will happen to not make it necessary? >> his toughness is very important. that is what the american public is watched and seen over time after time. i think in this particular case where the chinese cheated on every agreement they ever made on us he has to be very firm. the details. neil: in other words you have to follow up. ronald reagan said air traffic controllers can't go on strike. you can't fire them if they did. they didn't believe that he did. >> you can't show weakness. you have to draw a line in the

stand stick by it. when you say you're going to do something, do something. neil: if we have tariffs going into effect after midnight and the chinese do respond it makes prospect of a deal less likely at least soon. >> right. neil: the president's base could be hit by that. already in agriculture that is the case but these latest tariffs could affect a whole host of things that americans directly buy. absorbing a 10% tariff is one thing. 25% quite another, right? >> he will have to go to the country continually tell them why he is doing this, what the consequences are. i think he can do that very effectively. neil: do you tell the american people it will cost you more and here's why? >> this is about american jobs. we have the strongest economy we've had in years. lowest unemployment in 40 years, 50 years. if you want to continue that, basically you have to listen to me, listen to what my people are trying to force through the programs. neil: that is very well-put. if he says that he might get over the finish line, right? you should stick to this

political -- >> you think so. i think i'm a little old. all he has to do what he did to mondale. what we did to mondale. do you want to go back to the carter policies of 1984? reagan policies working, strong economy. neil: mondale stepped in it i will raise your taxes. >> he has the the advantage of two front-runners, democratic party, bernie sanders and biden, he is the younger candidate. neil: that's true. he is the kid. >> he is the kid. neil: as are you, my friend. ed rollins, thank you very, very much. we'll see. again the issue whether all of those new tariffs kick in at 12:01. there is competing thought any progress at all will avoid that i think to ed's point, most markets say unless the chinese dial back all the reversals they had it ain't going to happen. the dow is down about 335 points. it had been down more than 400 but no matter how you slice it on the week, we still have a day to go, down in excess of 4 1/2%.

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every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. take your business beyond. neil: all right. this is an interesting item coming into our newsroom. the u.s. government has seize ad north korean ship used to transport coal in violation of economic sanctions that have been in effect against north korea. there has always been suspicion

in the defense, the political community that north korea finds an end-run preventing things like coal and other vital supplies from getting into the country. we apparently suspect this ship had such things. now making its way to the u.s. waters. what happens after that is anyone's guess. keep in mind this only hours after we got confirmmation of the second projectile test, whatever you want to call it this week, in the past week on the part of the north koreans. technically not violating any agreement to stop that kind of stuff with the united states but coming awfully close and deemed provocative act just the same. republican north dakota senator john hoeven responding to this i'm throwing a lot at you, senator. for all i know you're familiar with all of this but these latest acts, what the north koreans did and our seizing this ship, what do you make of it? >> well look we've got sanctions in place on north korea.

it's our maximum pressure approach to trying to get them to give up their nuclear weapons. you have to be strong and consistent in that effort and that is what the administration is doing. neil: you've been long on the show how north korea does an end-run around sanctions that we think are holding that are not, but wouldn't that make us more predisposed not loosening things up here when the north koreans are urging that if we do, if we don't, they will do projectile or who knows what is next tests? >> that's right. it shows our sanctions are having an effect. the way sanctions work, over time they create more and more pressure. that is what you're seeing on the north korean economy. that is why we have to continue to be steadfast what we're doing, get them not only come to the table, but actually follow through in terms of denuclearization. neil: where do you see the whole north korean thing going? the administration didn't seem too concerned with the latest

test on part of the north koreans. it might be technical matter that they're not doing, you know long term missiles, that kind of thing, i get that, but the fact of the matter is, twice in a week, that is certainly provocative, is it not? >> well, again, it is, i think a follow-up to the last meeting between kim jong-un and the president where kim jong-un wanted sanctions relief beyond what -- what we were willing to give because he wasn't taking adequate steps to denuclearization. neil: senator, hang on to the thought. the president is addressing the issue. >> they're talking about negotiating but i don't think they are ready to negotiate. we have to do very much like china. the vice premier is coming here today. we were getting very close to a deal. then they started to renegotiate the deal. we can't have that. we can't have that. our country can take in $120 billion a year in tariff, paid more mostly by china, not

by us. a lot of people try to different steer in different direction. ultimately paid for largely by china. businesses will pour back into our country. instead of making the product, it will be the old-fashioned way, we used to do it. we make our own product. i think things are going along pretty well there, but a large group delegation headed by one of the most respected men and highest officials of china will be coming in today. they start at 5:00. we'll see what they can do but our alternative is an excellent. it is an alternative i've spoken about for years. we'll take in well over $100 billion a year. we never took in 10 cents from china, not 10 cents. it will be a, i think it will be a very strong day, frankly. but we'll see. we'll see. it was their idea to come back. reporter: do you plan to talk to president xi or no, not yet? >> he wrote me a beautiful letter. i just received it. i will probably speak to him by

phone but, look, we have two great alternatives. our country is doing fantastically well. our numbers at 3.2 -- don't forget 3.2 the first quarter is always by far the worst quarter or at least almost always, you look back at over the years, first quarter is almost always weak and which had 3.2 gdp. our unemployment numbers are the best in the history of our country. we're doing well. our companies are really doing well. even in ohio, the great state of ohio yesterday general motors at my very strong urging to put it mildly, very strong urging, i wasn't even nice about it, i appreciate what they did, they sold the beautiful plant, lordstown, they sold that beautiful plant to a very good company that will make electric trucks. that worked, the only thing they could say about the our economy, they kept saying lordstown, lordstown. when you have all the great companies spending billions and billions of dollars coming into

our country, they couldn't talk about it, they only mentioned one plant that was a gm plant from a very long time ago. now we have a great company going in and making electric trucks, very appropriate. interesting idea, actual, electric trucks. yes, please. reporter: will you allow robert mueller to testify in congress? >> i will leave it up to the our very great attorney general. he will make a decision. i will say this, the mueller report came out. it was done at, i guess, i'm hearing numbers now close to $40 million with 17 or 18 very angry democrats who hated donald trump and also everything that they could possibly have it at their disposal. nobody in the history of our country, more transparent than me. i said give them every document. give them every person. let the white house counsel testify. i think he testified for 30 hours. i guess they must have asked him

the same question because there wasn't very much to testify about but i said let him testify and let him, keep him as long as you want. actually when i heard 30 hours, i said that's a long time but i let him testify. didn't have to. i have presidential privilege. i could have stopped everything. i didn't have to give them a document. i gave them 1.5 million documents. i gave them white house counsel. i gave them other, anybody you want you can talk to. at the end. testimony, no collusion and essentially no obstruction. of course a lot of people say how can you obstruct when there is no crime, no collusion, how can you possibly obstruct? it is worse than that. it is not only was there no crime, but the crime was committed on the other side. so we're protecting against a crime committed on the other side. so after spending all of that money, all of that time, two years they come up with a report and, bob mueller is no friend of mine.

i had conflicts with him. we had a business dispute. we had somebody that is in love with james comey. he liked james comey. they were very good friend. supposedly best friends, maybe not but supposedly best friend. if you look at the picture file, you see hundreds of pictures of him and comey. with all of that and other things, he wanted the fbi job. i don't know if anybody knows that, he was considered for fbi job. wanted it. the day after he didn't get it he became special counsel. that's a conflict. we had other things. but those are tremendous conflicts. listen to this. your judge, call him a judge, has a business dispute with me. your judge has a fantastic relationship with james comey. well he is a part of this. he lied to congress. he is a liar, a leaker and your judge has a situation where he wanted to become the fbi

director. we chose director wray instead and told minimum, i'm sorry. those are tremendous conflicts. those are tremendous conflicts. and then he puts on his staff almost all democrats, many of whom contributed to hillary clinton. none of them contributed to me, that i can tell you. it started out at 13. it went to 18. these were angry democrats. these were people that went to her in one case, went to her, supposed to be a party. it turned out to be a funeral on election evening, and was going wild. he was so angry. this man now is judging me. other people made big contributions to hillary clinton's campaign. they were angry democrats and i think almost all cases. one of the people worked on the clinton foundation just about the top person at the clinton

foundation, with all of this, they came back, no collusion. there is nobody in this room, including you, if they were, that is you, john, if we looked at you, with $40 million, 18 angry people that hated you and all of the other things that i mentioned, they will find something, i don't know, maybe john or not. finish. reporter: mueller is friends with mr. barr. as you're aware mr. barr told lawmakers he didn't have a problem with mr. mueller testifying. >> i will leave that up to the attorney general. i think to me looks like a redo. here is what happened. the report comes back, it's perfect, it's beautiful. there is no collusion. nobody even talks about collusion. i haven't heard the word russia in a long time. there is no nor talk about russia. what about russia? the russian witch-hunt, they don't talk because it was so on collusion. which by the way is by far, that's the big deal. it was all about russia. so i haven't heard the word

russia. they don't use the word russia anymore. so there is no crime. there never was a crime t was a hoax t was a witch-hunt. so this comes back and it comes totally exonerating donald trump and a lot of other people. this was a terrible thing that happened to our country. now i will tell you what they are asking. they are asking how did this whole thing start? tell you a lot of people want to know. i had an event, lot of you were there, thousands of thousands of people standing in a field. they never seen anything like it, meaning even the press. it is always that way. we never have an empty seat. thousands of people last night. you know what they want to know? how did this whole thing start? it will be hard for them to answer that. yeah, please. reporter: mr. president, are you satisfied with the advice from john bolton? >> john is very good. john is a, he has strong views on things but that's okay. i actually temper john, which is

pretty amazing, isn't it? nobody thought, i'm the one that tempers him. that's okay. i have different sides. i have john bolton and people a little more dovish than him. ultimately i make the decision. i like john. i get very good advice from john. reporter: mr. president, as you saw the senate intelligence committee s&ped don, jr. republican-led senate intelligence committee. what do you make of that. >> i was very surprised. i saw richard burr said there was no collusion. he went outside, we found no collusion but i was very surprised to see my son, my son's a very good person. he works very hard. the last thing he needs is washington, d.c. he would rather not ever be involved. remember he said to me a long time ago when i was thinking about running, dad, if i can help, let me know. it is not my expertise. it is not something i really like, whatever i can do, you're

my father, whatever i can do. he is now testified for 20 hours or something, a massive amount of time. the mueller report came out. that's the bible, the mueller report came out, they said he did nothing wrong. the only thing is, it is opo research. if he did wrong, then everybody standing with me, probably, except for john and lamar, i think lamar is pretty -- did you ever do opo research on opponent. i don't think so, lamar? >> [inaudible] [laughter] >> i know john barrasso never did opposition research. he is a fine, fine man, but i say 99% of the rest of the folks. but what they didn't discuss is this woman that came in, who i watched her on "the today show" when it all started, i'm just innocent -- nobody even knows although the halls of congress know her very well because for years she walked around all over

congress. she came in and she left supposedly gps fusion, meets a short period of time with my son and other people. they talked about a subject as very well, you know, advertised and put out which is nothing, it was a nothing meeting. in fact jared left. he said get me out of this meeting. this is a waste of time. she then went back to gps fusion. they were the ones that wrote the phony dossier. why was she going to gps fusion? why did she go back? then i heard that don for a year, made three phone calls with an unmarked number. they called it unmarked. and this was a tremendous event because they all knew the fake news, they all, you were fair on that, john but they all knew that these phone calls, these tremendous phone calls before the meeting and after the

meeting, they were i believe three, right? they all knew that it had to be to his father, unmarked, it is perfect. so he reported about the meeting and then reported what happened at the meeting. except after looking and spending a tremendous amount of time and money, they were able to go back years and find out who made the calls. one was a local real estate developer. the other was a great person from nascar. two of them, a friend of don's. this went on for a year-and-a-half. john you heard all about the phone calls to obviously the father where i -- i never knew about the meeting. but the phone calls, to the father, turned out not to be the phone calls. my son is a good person. my son testified for hours and hours. my son was totally exonerated by mueller, who frankly does not like donald trump, me, this

donald trump. and frankly for my son after being exonerated to now get a subpoena to go again and speak again after close to 20 hours of telling everybody that would listen about a nothing meeting? yeah, i'm pretty surprised. reporter: should he fight the subpoena? >> we'll see what happens. i'm really surprised by it, i really am. reporter: you sent a aircraft carrier -- >> they were threaten, we have information, we have information you don't want to know b they were very threaten. we just want to have, we have to have great security for this country and for a lot of other places. reporter: do you risk a military confrontation sir? >> i guess you could say that always, right? always. i don't want to say no, hopefully that won't happen. we have one of the most powerful ships in the world that is loaded up. which don't want to have to do anything. what would i like to sigh with iran i would like to see them

call me. john kerry speaks to them a lot. john kerry tells them not to call. that is violation of the logan act. frankly he is should be prosecuted on that but my people don't want to do anything that -- only democrats do that kind of stuff, you know. if it were the opposite way they would prosecute him under the logan act but john kerry violated the logan act. he is talking to iran and has been. has many meetings and many phone calls and he is telling them what to do. that is a total violation of the logan act. because what they should be doing is their economy is a mess ever since i took away the iran deal. they have inflation that is highest number i ever heard. they're having riots every weekend and during the week even. and what they should be doing is calling my up, sitting down, we can make a deal, a fair deal. we just don't want them to have nuclear weapons. not too much to ask. we would help put them back into great shape. they're in bad shape right now.

i look forward to the day where we can actually help iran. we're not looking to hurt iran. i want them to have a strong great economy but they're listening to john kerry who has violated a very important element of what he is supposed to be doing. he violated the logan act, plain and simple. shouldn't be doing that but they should call, if they do, we're open to talk to them. we have no secrets. they can be very, very strong financially. they have great potential. very much like north korea. north korea has tremendous potential economically. and i don't think he is going to blow that. i don't think so. reporter: [inaudible]. is it still possible to get a trade deal with the china this week? >> it is possible. they're all here. the vice premier, one of the most respected men, one of the highest officials in china is coming. you heard he wasn't coming. he is coming.

once they tariffs, they upped meeting. it was supposed to take place thursday or how about friday, what is this all about? don't worry about it, let's take in 100 billion a year. we put the tariffs on. we made the statement. and then they upped the meeting. how about let's go back to thursday? i have no idea what is going to happen. i did get last night a very beautiful letter from president xi. let's work together. let's see if we can get something done but they renegotiated the deal. they took, whether it is intellectual property theft, they took many, many parts of that deal, they renegotiated. you can't do that i'm different than a lot of people. i happen to think the tariffs for our country are very powerful. we're the piggybank everybody steals from including china. we've been paying china $500 billion a year for many, many years. china rebuilt their country because of us. they couldn't have done what

they're doing. they are building a ship every three weeks. they're building aircraft like you have never seen, fighter jets. i respect it. i don't blame them. i blame our past leadership for allowing this to happen. what i'm doing now with china should have happened many years ago. not just obama, long before obama. i always say, if you look, nafta is one of the worst deals ever made, trade deal but the worst trade deal ever made is the wto because china was flat-lining for many, many decade. many, flat, right here. the wto came along. we allowed china into the wto and they became a rocket ship. you got to take a look at a chart sometime. do it. it will be very interesting, an economic chart. they're here an they went up like a rocket ship. well, they did it with our money and others and they did it

because they're very smart and they are good people and i like the president a lot. he is a friend of mine but i'm representing the usa and he is representing china and we're not going to be taken advantage of anymore. we're not going to pay china $500 billion a year. so we put very heavy tariffs on china as of friday. and we put them on also eight months ago. when people looked at the economic numbers they were shocked, when they look at the import export numbers, they were shocked. they said wow, how did they get to this point? this was very good. those are very good report. they are never seen that for many years. i say try looking at all the tariffs chinas been paying us for the last eight months. billions and billions and billions of dollars and that is only because i gave them a break. because we were negotiating goodwill, we were negotiating i gave them a break. let's keep it at 10% instead of

25%. now what we're doing we're raising it to 25% on friday. so it will be $250 billion, at 25%. and it will be $325 billion at 25%. and we're starting that paperwork today. so we'll see. but you know what? as president of our country i had to do something about it. and as president of our great country we're going to be take income more money than we've ever taken in. all these countries taken advantage of us, including our allies, they have taken advantage of us on trade. they have taken advantage of us on military. we defend these countries for nothing or tiny fraction what it costs. we take care of nato. i'm all for nato. i'm all for nato. i think it is just wonderful but it is different than it what was 25 years ago, and 40 years ago. i got nato to put up an extra

$100 billion. ask secretary-general stoltenberg. he is like donald trump's biggest fan because spending was going down. the contribution was the 28 countries were making, it was heading like a slope down, like very steep mountain. and then i came and it went up like china. it went up like a rocket ship, okay? but i don't like seeing people take advantage. we pay for, anywhere from 70 to 100% of nato. so we protect nato. we protect european countries. we protect them. we protect them beautifully. we're the power. we're the most powerful nation, especially since we've redone the military. redoing, and done all the nuclear. never want to use it but you have to have it. but we've spent, i thank congress for this, 700 billion doll. then 717, $16 billion, on our military. our military when i came to office was totally depleted.

we now have by far the strongest military in the world. but we defend countries. when you look at our budget, so we're 716 billion. and russia is at 68 billion. how do you figure that? because russia doesn't go around defending every country in the world and not getting paid for it. you know what? i don't mind not getting paid f there is a country that has been horribly treated, lots of bad things are happening, they're not a rich country but when we defend the richest countries in the world, and they don't pay us for what we do, and frankly they go back and in closed meetings and laugh at the stupidity of the united states for doing it. these are countries with nothing but cash. they could very easily, i told the story last night. i picked up $500 million with one phone call to a country. that sus why the beginning.

over one short period of time. one phone call that lasted for a period of five minutes. i picked up $500 million because i said, you're not taking care of us. we're taking care of but you're not taking care -- it's not fair. really the word is not fair. nato doesn't treat us fairly at all but now they're starting to pay. and if you look at mr. stoltenberg, he will tell you, he has never seen anything like it, $100 billion. that is a low number. they're paying $100 billion. how do you feel about this? germany, you're supposed to be paying 2%. germany is paying 1%. they say 1.3, but call it 1%, it really is closer to 1%. germany pays to russia billions of dollars a month for the pipeline. and yet we're supposed to be defending germany from russia. so germany is giving the so-called enemy, i don't call an enemy, i want to get along with russia and i want to get along

with china, because i'm smart. stupid people don't want to get along, because i'm smart. this witch-hunt hurt us in our relationships with a lot of countries t was a very expensive horrible thing for our country. by the way should never ever happen again to a president. two years i've been going through this nonsense and now we have a good report and now guys like jerry nadler, who i fought for many years successfully i might add, back in new york in manhattan. he was a manhattan congressman. i beat him all the time. i come to washington and now i have to beat him again. over nothing. over nothing. over a hoax. and they know it is a hoax. they are smart. nadler is a smart guy. schiff is a smart guy. when schiff goes to the microphone he is conning this whole country and he knows that. and he goes back into a room and you talks to his friends and he laughs because that is the way life is. but our country is doing great. we'll find out about china tonight. and i think in the end you're going to be very impressed with

the kind of things we're doing. and the reason they were so surprised with the numbers two or three weeks ago, not the 3.2 gdp which everybody was surprised at, may more importantly, port numbers, import numbers. we have billions of dollars coming to our country, that our country never would have seen. with a regular president. this should have been done many years ago. i told president xi of china. i tell o abe, prime minister of japan a good friend of mine, i don't blame you. i blame the people that ran the united states and i blame their trade representatives. frankly i blame our presidents because this should have never happened. we have been losing for years close to 800 billion doll, not million, 800 million is a lot but we've been losing $800 billion on trade.

$800 billion. we're going to stop that. and we've already started. so we have a meeting tonight at 5:00 with the top people from china. we'll let you know what happens. thank you all very much. [reporters shouting questions] [applause] >> a little while. i like the red sox. >> what do you say to those that you're too divisive and it will hurt re-election. >> so you understand we gave puerto rico $91 billion for the hurricane. that is the largest amount of money ever given to any state, talking about states and puerto rico, a little different. $91 billion. texas got 30. florida got 12. puerto rico got $91 billion. so i think the people of puerto rico should really like president trump. now that money was given by congress but they got

$91 billion. now you remember how big the hurricane was in texas, largest water dump in the history of our country they said. three times it went in and went out, went in. texas got $30 billion. florida got actually, anywhere between nine and 12. puerto rico got $91 billion. now the democrats are trying to hold up the money from georgia, from south carolina, from alabama, to florida. they're trying to hold it up. they're hurting florida. they're holding, i mean what they're doing to north carolina, to louisiana. they're trying to hold relief aid because puerto rico which got 91 billion, have to love their president, they want to get puerto rico more money. they're willing to sacrifice, georgia, alabama, south carolina, north carolina, florida, louisiana and other states. the democrats are doing that.

they very divisive people. thank you very much. neil: all right. the president making a lot of news there before we go back to the north dakota senator, just a couple things toe wrap up here, why the markets are at the lows. he intimated president is working on alternative trade deal. he received a nice letter from chinese president xi xinping. a quote, beautiful letter, would seem to indicate that not everything is a total lost cause. when it comes to china but tariffs are going to go into effect as things stand now. he could be pleasantly surprised. might not happen. he referred we're in a position oven in the united states, referring to the first quarter gdp numbers where we had the surprising up tick of 3.2%. there were many economists who point out that that was disproportionately affected by a

boosting their inventories possibly for a trade war with china. so they were trying to stack up their shelves in time to prepare for that. you could read that a couple of ways. he also talked about the mueller situation. was -- wasn't a personal fan of mueller. they had a business conflict and mueller had a business conflict, goes back to a trump country club in virginia, mueller who was a member since the 1990s was trying to leave that club around 2011 and want ad partial refund of his money because he was. i forget the reasons why he wanted to leave. maybe it was distance, time, other duties obligations but he want ad refund. that necessarily did not really pose a conflict per se but the president saying the two never got along. finally when it came to his son, vis-a-vis by senate intelligence committee saying all of this exhaustively gone over again and

again, there is no reason for this intelligence committee to talk to his son, i believe the issue for that committee was that having read the mueller report, there are all could of different takes and positions that donald trump, jr., told the mueller folks about that conflict with the testimony he gave the senate intelligence committee or shared with them. so, might be the committee's way of just trying to dot the is, cross the ts, make sure they have everything accurate. clearly the president not a fan where that is going. unending investigations around him. again senator john hoeven back with us, republican of north dakota. senator, thank you for your patience. >> sure. neil: the president making it clear he is willing to fight fire with fire when it comes first off to the chinese on trade. i think farmers in your state, what is at stake. do you believe him when he says that this has not been a big

cost to americans nearly as much as chain, that would dramatically change if it were true, should 25% go into effect from 10% on much more items, right? >> certainly this is a fight we need to win. we want china to trade fair, to quit stealing our technology. it has had real impact on our farmers. that is why we had earlier market facilitation payment. if the chinese continue to delay, i made it clear to the administration we have to do more. i make it clear through ag appropriations. because the chinese targeted our farmers. we need to win this fight, get the chinese to trade fair and to take down these trade bearers. to quit stealing our technology. neil: do residents in your state, sir, do they have the patience for this, the stomach for this? they have suffered agriculturally around the like, in other businesses, businesses borne the 10% hike on their own.

things will change 2007:-- 12:01 more things than can affect that more things will change, wouldn't it? >> there is a recognition we need to push back to get the china toes to push back to -- chinese to play fair. there is big impact on ag. help them stay in the game as i described. they are being targeted by the chinese. also for our manufacturers we need a product exclusion process. there are things we can do to help as we negotiate. ultimately we've got to get china to trade on a fair basis, not steal our technology, and take down some of these trade barriers. neil: already, sir, thank you very, very much. always good seeing you. i do appreciate your patience. >> sure. neil: senator hoeven from the beautiful state of north dakota. if you're looking what is happening on the dow, it shaved its losses mightily and that is probably on the president

talking about alternative trade deals. that he is still optimistic on the trait front. more to the point that he received a beautiful letter, quoting president from xi xinping, president of china who he enjoys a good close relationship. optimism abounds. markets determined that a sign of progress even though the negotiations formally kick off, having this dinner tonight, there is very little time to avoid tariffs kicking in on $200 million of goods. doing a bit of fact-checking, clarity checking here, that china paid disproportionate amount on tariffs in effect already. governments don't pay that as you know. individuals do. companies do. the impact on farmers notwithstanding he is referring to the fact that up to now, many businesses borne the cost of those higher tariffs by not passing them along to you. they absorbed that. there is only so much you can do

when they're more than double from 10% to 25%. all of sudden you go from 50 to 75 billion to more than 200 billion and the president indicating that he is ready to bring them up to an additional $325 billion worth of good which would effectively be pretty much everything china sends us, but i cannot stress enough in no-win trade wars, no matter your politics, governments don't pay those tariffs. you do. the question is, how much? we'll see. got "daily caller" editorial director vince looking at wall street's reaction off its lows, we still have a long way to go here but the interpretation seemed to be, i don't know, maybe we see a hail mary pass here at midnight and those tariffs are avoided, the friction is avoided, and i think what the "new york times" called the donald trump trade put is in effect. what do you think? >> i think that's the hope. look, what the markets hate most

is uncertainty. one of the biggest uncertainties over the u.s. market looking forward is the status of u.s./china trade. a lot of american businesses have these very complex supply chains in china so if they can come to some agreement, i think the markets will be very happy. i think the president has an interest in that agreement, too, but i think it's important for him to keep the growth that he's seen going and also, you know, there are a lot of people spoiling for a fight with china. look, china does cheat, it does steal and so forth, but the president didn't get elected saying he's going to fight with china. he got elected saying he's going to deal with them in a tough way. but that means reaching a deal, right? doesn't do any good if we get into a giant war and there's no outcome. trade washingtr, i mean. neil: i understand. it might be getting in the weeds here but the president saying essentially we are coming from a position of strength with regard to china, referring to the first quarter gdp number which was

very very strong, a lot of people cynically look at that and say it was stronger than normal because a lot of these businesses are preparing for a trade war or one that will make it very difficult to get their hands on chinese goods or those that could suddenly have 25% higher price tag so it lifts the economy more than might otherwise have been the case. what do you think of that? >> the reality is either we roll over and die or fight back and try to get china to correct some of its actions. those seem to be the options in the eyes of the president. when he says the united states has gone for many years without issuing any kind of corrective to china, without pushing back at all, it seems lose and lose and lose, eventually the only recourse you have is to actually say fine, we are actually going to live up to expectations. it was interesting hearing the president say he's tired of the game of rope-a-dope with china.

the president thrives on uncertainty in negotiations. he loves presenting to china an uncertain fate. they don't know what he's going to do. all they know is he's promising tariffs. now they have the vice premier of china rushing into the united states to fend this off in late negotiations. neil: the dow down now about 175 points. we had been down in excess of 400 points. obviously the markets reading some hope into this. i always hasten to add for this very minute. things could change. there was a point on monday morning we were down close to 500 points and we finished the day almost unchanged. i never really try to read a minute by minute movement of the dow. the only thing that turns it around optimistically for the markets was the sign the president got this beautiful letter from xi jinping which mirrored the comments he gave when kim jong-un sent the

beautiful letter. that did not stop kim jong-un from launching another projectile test this morning, its second in less than a week. by the way, the back-and-forth with china did not stop them, good relations with the chinese president notwithstanding, from reneging on the deal the reuters folks said was all agreed to before the chinese started saying no, no, no, no, no. they have din-din planned for tonight. i don't know where it will be. i don't know if they will hop into a red lobster. blake burman might have more on what's planned and how the next hours will go. we are counting down, aren't me? reporter: bunch of good coffee shops around the white house here. i think they will do something better than that. as the president just revealed a little while ago, the two sides will be meeting officially for the first time at 5:00 later this afternoon. we are also led to believe that the u.s. and chinese trade teams will sit down for dinner at some point and have discussions. you just heard the president talk about how it is possible that a deal could be made this

week. the markets seemed to like that although i would also point out in theory anything is possible. you brought up the hail mary. could there be a hail mary. let's use a football example for a second. i know the boston red sox are coming to the white house here this afternoon but in football terms, there was a very real sense among the trade team, they thought just about a week ago that they were inside the 10 yard line. they were getting close to the end zone. but what happened over the weekend when they got that revised draft by the chinese in which it was described to me that china would no longer commit to changing its laws and stripped away some binding legal language, that didn't get the ball closer to the goal line. it put it a lot closer to midfield. is it possible to score from there? sure, it's possible. is it likely at this point? i think it's fair to say talks would have to go very, very well over the next day and a half or so. the president, though, did say he received that letter from xi jinping and the president also continued to tout the use of tariffs which will go into

effect tonight come midnight. here was president trump just a little while ago. >> did get last night a very beautiful letter from president xi, let's work together, let's see if we can get something done but they renegotiated the deal. they took whether it's intellectual property theft, they took many, many parts of that deal and they renegotiated. you can't do that. reporter: a lot of comments from the president on china. i wanted to play you that specific sound bite because even though we know china had walked back aspects of the deal, the administration had been very reluctant to say exactly what. for the first time there we heard president trump say intellectual property theft is among the items. as you know, that is at the very, very top if not at the top of the list for the u.s. team as to what they want changed, so if china walked that back, you've got to wonder how a deal could get put in place. neil: it begs the question what do the chinese do in response.

they already promised a response. what are you hearing it would be? reporter: yeah, china has said essentially remember, when you go ahead with the tariffs, it's not a one-way street. we can impose it as well. i do not believe the chinese have put a specific number to this or even a specific list, just the threat out there of if you're going to play this game, we will play it, too. as we know, when the u.s. went forward with its first batch of tariffs, china responded. neil: thank you, my friend. blake burman at the white house. if we get any more from there we will keep you posted. let's get the read on this because we are well off our lows of the day. still down about 150 points and still looking at about 24 of the dow 30 issues down. they were virtually all down before the president started addressing reporters' questions. let's go to michael levy of fidelity investments global background invest or and deirdr

bolton. i'm wondering if he was sending a message hey, anything's possible? >> anything is possible and it moved the ball a little bit forward from what president trump said yesterday at that rally which is china broke the deal, and that's sort of 90% of the way home that we were apparently between the u.s. and chinese on the legal requirements which essentially would make china stop stealing american i.p., especially when american businesses are functioning in china. yeah, anything can happen. there are a lot of other pressures as well. i don't want to just say it's about that. intel today announcing the next three years of sales and earnings are going to be lower than what analysts had forecast. so there are a lot of stocks in play. it's not necessarily 100% related to u.s./china trade wars but it certainly does have an effect. we are beginning to see it in some dow members. neil: the president referred to the fact the beautiful letter he received from xi jinping. he's also received certainly beautiful letters, if you think about it, from the north korean leader. that does not stop him from,

taking the case of north korea, a cargo ship it suspected of sneaking in supplies to the north koreans or for that matter, in the case of china, from upping the ante on trade and tariffs. where is all this going? >> there is just too much at stake for a deal not to be done. it's very much in the best interests of china, very much in the best interests of the u.s. what you're seeing now is positioning. positioning from say the tstatu quo. my understanding is a lot of the establishment in china, old guard, if you will, wanted nothing to do with this trade. they are used to being subsidized, stealing technology. that can't go on forever. it's near-term pain for long-term gain. the only way china can flourish the next 40 or 50 years is by opening up their markets and coming to a trade deal that would essentially give the u.s. most of what they want is ultimately in their best interest. however, it might be a difficult political swallow.

neil: i have problems with smith but let me ask you a little bit that. the president is arguing we are in a position of strength. we talked about that in the past. but much of the strength if you want to be technical, wonky, weedy and boring about it as i am, i built a career on it, you could argue business is building up ahead of what they suspect will be a trade winter with china. look, numbers are numbers are numbers, the employment report is terrific, the economy is doing very very well, but is he overstating that? could it boomerang on him? >> no, i don't think he is but there's a distinction between the u.s. economy and the u.s. stock market. so the economy, very strong, we all know the numbers, low unemployment, stable inflation, the fed has sort of left the building so that's sort of no longer a headwind. there clearly was some frontloading of trade over the past couple of quarters, companies trying to get their orders in ahead of the tariffs so the gdp numbers maybe are a

little more volatile than they otherwise would be. neil: some said it might have only added .2%. it was a strong report. >> exactly. the economy i think is fine. the new tariffs and even the existing tariffs, they do affect consumer prices so consumers, u.s. consumers may pay a little more for their products. it also affects the price of high tech goods that go into making stuff. so that's really where the distinction comes in between the u.s. economy and the stock market because the stock market has benefited from globalization and you can see this in all-time high profit margins which again feeds into the generation of a lot of free cash flow. so if you start getting deglobalization, still globalization but at a lesser rate, you could see profit margins start to erode, still to very robust levels, but you could actually get to a point where the stock market sort of underperforms the economy which would be the opposite of what we have seen over the last ten years where the economy grew at

2% but the stock market was up 17% per year. we may reverse that now. so it's an important distinction to make between those two. neil: that's a very good distinction. one of the things i thought of, too, is americans have been very lucky this has not impacted them yet. i'm not dismissing the plight of farmers, because the north dakota senator was telling us it's very real. but because they were only 10% on a few variety of goods, most of them absorbed it finding a way to work with chinese suppliers to mutually absorb that. harder to do when it's 25%. harder to do when it's extended to maybe -- deirdre: a whole new list. neil: exactly. we have gone from a dozen items to in excess of 6,000 that could be affected. now the walmarts are feeling it, the targets and others. the game changes at 12:01%. deirdre: it goes from 10% to 25%

if nothing changes between now and then which is obviously more than double. to your point, this whole other list, completely other list of $325 billion worth that we are going to place 25% tariffs on -- neil: by the way, that would include, now we are at more than half a trillion which is pretty much everything. deirdre: right. right, right. as the president has lined out, as u.s. trade rep robert lighthizer pointed out. from the point of view of the investor, 83% of the s&p 500 companies have already reported. more than two-thirds have exceeded earnings. more than half have exceeded revenue expectations. we were expecting that net to drop to 2%, 2.5%. there's a rise of 2%. not saying that's amazing but just saying everything is tracking better at least for investors which underlines your point that the average person, the average investor, has not felt this so, so much other than having to take antacids. neil: exactly. any other day, you think about it, our seizing a north korean

cargo vessel that we suspect is loaded up with coal against the sanctions we have in place, that would have been a game changer because it came only hours after this second projectile test the north koreans had. it seems to indicate that relationship is getting tested, for maybe all the right reasons, but is china coming into play? >> look, i think china is going to do everything they can to antagonize us. i believe north korea is a puppet state of china but to get to your gdp point, i think most of the market, most of the talking heads, most of the experts have completely underestimated the multiplier effect from the deregulation. there are 150,000 companies in the u.s. between $25 million and $1 billion in revenue that are private. all of them got a massive tax cut making it easier for them to hire -- neil: more than offset whatever effects come with this, right? >> you know, the thought was with the government shutdown we were going to have negative

growth in the first quarter from a lot of very smart people. our underlying u.s. economy is much, much stronger than most people give it credit for. now that the fed's on hold, we are going to have a little bit of stock market volatility but nothing like the end of last year. this gives us all the power to go into these negotiations. china knows it so they are stirring the kettle with north korea. neil: real quickly on that point, you have been richly rewarded in the market if you think about buying on these chinese trade talks, looking disappointing dips. do you think that this is that moment again? >> as long as the fundamentals are supportive, which as michael said, remains the case, earnings are growing pretty well, free cash flow is growing, the fed is on hold, valuations are okay, they're not great but not terrible, and so as long as that is the case, basically like you said, investors have been rewarded for buying the dip. ultimately it's a matter of, it's a function of valuation. everyone looks at the dow and s&p but it's the pe multiple that ultimately is what we

should -- neil: that's not rich to you? >> it's not rich as long as the fundamentals remain supportive. but the market has priced in a deal and now we don't know, so therefore, the pe comes down and ultimately, if profit margins are affected or not affected, it all feeds into is the market worth 16 times earnings, 18, 17, and i think that's the price discovery the market is looking for. if the fundamentals are on track, ultimately, the s&p will be above 3,000 because we are almost there now and earnings are growing. neil: all right. guys, thank you very much. he already said i'm never coming back, you screw up my name. a lot more coming. never said that. he's too classy for that. interest rates are still low so there was a flight to quality just to protect yourself, seizing a north korean vessel, the back and forth with the chinese. lot of agita out there. the hope is cooler heads

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well, we're looking at it very seriously right now. they were smaller missiles, short-range missiles. nobody's happy about it but

we're taking a good look and we'll see. neil: all right. the president was speaking about another missile test in north korea. this is the second this project it. technically it didn't violate any promises we had from the north koreans that they weren't going to do any long-range testing. we're splitting hairs here. commander, obviously it's a provocative act, the president still trying to leave wiggle room for the north korean leader to come back, talk and agree to some of the things he has already agreed to. but there does seem to be growing suspicion that the north koreans are not to be trusted, period. what do you think? >> i definitely don't think they're to be trusted at all. they will do everything they can to improve their position. it's a negotiation right now. so they want the economic relief and they're going to push as far

as they can and try to get as much as they can. so this is going to be provocative. we are going to have some, you know, tit for tat going back and forth as everybody tries to increase their bargaining position. neil: indeed, we saw a little of the tat part of that an hour ago. we got word, commander, that we had seized north korean cargo vessel that was supposedly loaded with coal. one of the many things banned from north korea so they are finding end runs, if true, around the sanctions in effect which again hardens positions that you don't want to negotiate when they're doing that stuff, right? >> i think they are going to continue to try to do that. you are going to negotiate but you are also giving them physical substantive measures and demonstrations that we are not going to slack off on the sanctions. we are going to just keep upping the pressure more and more. that's what's frustrating them. neil: let me ask you about dealing with north korea in general, commander. if they can't be trusted and we sent signals we're holding back

ourselves, we are going to suspend our efforts to get the remains of soldiers, american soldiers who were there going back to the korean war, it sounds to me that things are icing over here. what do you think? >> i think you kind of look at it a little like the market. this was never going to be a straight trajectory up. it has its ups and downs. remember, we are in a lot better place now than we were a year and a half ago, than we were three years ago with north korea. so of course there's going to be some retracement back and then hopefully we progress up again and start getting back into the positive with them. that's all we can kind of go towards. neil: are you surprised as well that many times we have seen kim jong-un, the north korean leader, just recently as two weeks ago meeting with vladimir putin shortly before that with xi jinping in china, and i don't know what happens at these events but maybe it's very analogous to what happened with him and president trump in

hanoi, he comes home empty-handed. no one is rushing to give him money, no one is rushing to bail him out. i'm not naive enough to think there were end runs around sanctions and the like, but even his two benefactors aren't sharing the loot with him. >> it's not the black and white world we sometimes depict it as. russia and china want ability there as well. they're not just carte blanch enablers of kim. they want things from him as well. they want stability. they want him to act responsibly but at the same time they want him as a buffer. he's not commanding them to do anything. he likes to have this big presence but the reality is he's still a very small player on the world stage. neil: a lot of disproportionate attention. thank you very much. thank you as well for your service to this country. we have the dow back over 200 points. we had been over 400 points. again, everything comes back to

this trade deal. i know i sound like a broken record. the better it looks, the better stocks look. worse it looks, worse they look. right now the president talking about maybe putting together an alternative deal. more to the point, getting a beautiful letter from the chinese president, was enough to get the markets thinking maybe they can do something. they've gotten ahead of themselves before but right now, they're at least hoping against all hope that might put off trade tariffs that would kick in at 12:01 a.m. tomorrow. more after this. from fidelity. a visual snapshot of your investments. key portfolio events. all in one place. because when it's decision time... you need decision tech. only from fidelity.

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♪♪ ♪♪ we were getting very close to a deal, then they started to renegotiate the deal. we can't have that. we can't have that. so our country can take in $120 billion a year in tariffs paid for mostly by china, by the way, not by us. lot of people try to steer it in a different direction. ultimately it's paid for largely by china. neil: um, we pay for tariffs,

just to be clear. chinese citizens of course, they are facing a backlash. indeed they pay the price for that but governments per se do not bear the cost of tariffs. those businesses directly affected by the tariffs already in effect have been able to absorb the 10% hit largely because working with their chinese suppliers, they have worked together to minimize the impact of passing that 10% hike along to their customers. that will change mightily at 12:01 a.m. tomorrow morning, when that's racheted up to 25% and affecting more than $200 billion worth of chinese goods, quadruple the number and dollar amount of goods right now. and all the more impacted when the president as he intimated in his remarks just about 40 minutes ago, increases that to $325 billion worth of additional

goods which would cover all chinese goods virtually shipped into this country. so the club for growth president david mcintosh with us, small business and entrepreneurship council president and ceo karen kerrigan and scott bolden. scott, it's interesting that a number of democratic leaders including chuck schumer, nancy pelosi, have supported the president on this hang tough with china in that maybe their states recognize it's important to do so because many unions and elsewhere will tell you right away of their concern the chinese are gouging us and taking away our jobs, et cetera. what do you make of at least that pocket of bipartisanship? >> i think it's awesome to have that pocket of bipartisanship. the hard working class americans in this country who supported trump and the unions who support democrats traditionally, that is some bipartisanship.

they are the same set of voters and they are suffering. so i think the democratic leadership ought to be standing with trump on this publicly despite the constitutional crisis we're involved with right now and that i think that donald trump is playing his hand hard and fast right now, but something's going to give before now and 12:01. their meeting. it's going to hurt both countries, both consumers, especially what we projected to be these tariffs that are going to be applied. we'll just have to see. neil: you called it a constitutional crisis. i don't want to go off the rails here. >> i know, i'm sorry. neil: it's not a constitutional crisis unless the president ignores the judge who's told him to do otherwise, right? >> well, he can't but his people can be held in contempt of congress and that's not a good thing. neil: karen, let me ask you about the economic environment to which the president refers. i think we are in better position here that this will work out because we are. what do you think? >> well, it's true, in terms of the tax and regulatory policies that were put into place early

on in the administration, they do serve as a buffer against any of this pain, the current pain of the tariffs, certainly. and you know, there's strong growth, there's robust growth. small businesses are still confident, their financials still look good. there's opportunity. their top concern is still finding the qualified people they need to expand their businesses. so the economy is in good shape. we have said all along that the longer this tariff situation goes on, if it escalates, the broader the pain. to this point there have been buffers although certain industries are more impacted than others but once you start racheting it up, then it does cause more pain and hopefully we are not going to get there, but on the other hand, you do have many of our members, our small business members, who are behind the president in terms of the intellectual property issue, fair access to markets.

look at the chinese are the biggest infringers in the world and they steal $225 billion to $600 billion in u.s. i.p. every single year. so all industries are impacted by this. and there's just a large majority -- neil: you're right, there's a lot on the line. david, one of the arguments has been for not making a big to-do over this. in the scheme of things, the bang for the buck we're getting with tax cuts and lower regulations dwarfs whatever negative impact we're going to have on the chinese trade front. what do you think of that? >> look, the president's end goal in all of this, as he stated several times, is zero-zero tariffs, he put that on the table. that we think is excellent. that would actually boost the growth even further, probably 4% gdp growth. but if the end state, at the end of this, is both sides raise tariffs rather than negotiating to zero-zero, that's a loss. that's a definite loss for the u.s. and for china.

because you're right, as you said at the beginning, americans pay these tafriffs, chinese pay the tariffs their country put on and business is hurt when there's less trade back and forth. our hope is this is the art of the deal going on. the president laid out the parameters of here's the negative if we don't cut a deal and now his charm and negotiating style, he's said very nice things about the chinese president today as well, we're waiting for that to kick in so we get back on that track to moving to zero-zero tariffs which is the best ultimate economic outcome. neil: you know -- go ahead. >> what i was going to say was, the president has got to get a deal done on our side to protect our american companies. this i.p. theft, this technology theft that we're experiencing under their law on an annual basis as well as companies who want to do business in china very oftentimes have to give up half of their company just to be there to get access to that

market. so i think the president right now is saying listen, i'm putting this deadline in place, i'm pressing and stressing, they're in our country now negotiating because i've got to get a win on this not just because i like a political win but i've got to get a win for our companies who have been suffering the way they have been suffering in the past, and now is the time. neil: i'm wondering too if we are talking past each other. it's two different cultures. i get that. when i hear that the chinese maybe misinterpreted the president's bashing of the federal reserve as a sign that he's worried about this recovery and that he desperately wants a trade deal to avoid the economy slipping away, that's certainly a false read, but i thought it served as a reminder just how things are translated, you know? >> well, it is. this is the chinese, after all, we are goerti innegotiating wit

certainly the latest move, whatever they did to get the president ticked off and backing off some of the i.p. protections and other things, they are poking at him, right. they are sort of sensing some weakness, perhaps. neil: they clearly misplayed it. >> absolutely. neil: if they misplayed it, then they've got some humble pie to eat and that's a face not saving gesture. >> you know, neil, i think this almost was inevitable in some ways. both because of the mismatch on cultures but actually, i think part of donald trump's negotiating style is to have a point where there's a crisis, if you don't do the deal. and he's rolling into the final stages of that, setting that stage to tell the chinese here's how much is at stake if we don't cut a deal. neil: i hope you're right. i wish we had more time. guys, thank you so much for joining me on a very, very busy news days. i would be remiss if i didn't refer to the big uber offering,

of course, tomorrow, lowering expectations ahead of an initial public offering that's getting a whole lot of scrutiny. what's going on there and what does it telegraph for the markets from here, after this.

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neil: all right. the word on wall street is if you want to know the pace of the economy, talking to investors, fox is a stand-alone concern telling a lot of assets to disney. jackie deangelis? >> it was an opportunity for fox corporation, our parent, as you mentioned, to brief investors on its earnings, also allowing key executives from different business units to lay out the vision and their plans.

fiscal third quarter earnings they beat on the top and bottom line. 76 cents, a nine cent beat. fox announced a 23 cent semi-annual dividend. fox chairman and chief executive lachlan murdoch took the stage this morning, and said this. >> we see ourselves as a sort of startup but with america's strongest media brand and most enviable balance sheet. we out-punch competitors in the amount of live television we deliver to american households. we call this the power of now. >> it was a really strong statement and it echoed the sentiment from his father, rupert murdoch, who said the company is pivoting at a pivotal moment. there was a lot of talk also about how to strengthen each business unit as well as how key integration of digital is going to be in engaging the audience. the stock trading well up over 3% higher on the session. a tough day for stocks. neil: thank you very, very much,

jackie deangelis. meantime, charlie gasparino is following what is weighing on stocks and has been pretty much all week, the prospect of those trade talks. concern about what happens at 12:01 a.m. tomorrow when a whole bunch of tariffs are supposed to kick in. charlie, what have you got? >> we got a lot of this from some of the people here, some of the major brokers. there's a lot of brokers here, lot of financial advisers. they manage billions of dollars of wealth here. i have been speaking with them. they work for major firms. i have been confirming it with some of the people at the major firms. here's what they're saying. take this from the source, it is coming from wall street. if you are a small investor, take it from the source. what the big brokerages are doing is they are essentially downplaying in client meetings to their clients, major clients, the possibility of an all-out trade war, at least now. that doesn't mean we won't have tariffs. they are talking about an all-out trade war where fists are flying and it could take out

the market for 3,000 points. they are saying that's not going to happen, likely not to happen. they are talking about a trade war of that magnitude, being around 20%, at least that's what they're telling their clients. one of the problems you have here for the brokerages, neil, is that clients have a lot of money in cash, apparently. they have been building it up over the last month, precisely as the china trade deal started heating up, as the potential of a trade war started to seep into the media, so the clients are putting money in cash. the brokers are getting scared that there's too much money in cash, they're not making enough -- you don't make fees when money's in cash so they are advising their clients right now that they don't see a major -- chance of a major trade war. again, i tell you this is coming from wall street. i think they might be downplaying this a little too much, to be honest with you, given the president's speech although the market is off its lows so you know, there is some hope obviously in some of the

stuff trump said. that's what you're getting from the brokerage firms. why is this important? brokers give guidance to their clients. they generally give guidance to their clients based on a sort of formula that is developed at the top of the firm, like merrill lynch, ubs, morgan stanley, they come up with an outlook and the outlook right now from the major brokerage firms is that they don't see a major chance of a trade war. they are telling clients stay committed to stocks. they are also telling clients once we get through this thing, there's a lot of steam left in the bull market. again, that's what they're saying. i'm not advocating this position. but it is interesting that the major brokerage firms are saying that don't overplay this trade war stuff. donald trump talks a good game, talks tough, often doesn't go the full monte when trade's on the line, particularly as 2020 is coming. that's one of the issues here. is he willing to go into real battle mode with the chinese,

something that could take 1,000 points, 2,000 points out of the market, when you're running for president. brokerages saying not going to happen. back to you. neil: i appreciate it. the so-called trump put. >> the trump put. or the cavuto put. either one. neil: you say -- >> by the way, you are missed here at the gambling tables. name came up a few times last night. neil: i think you are referring to the buffets. but probably right. good seeing you. get home safe, all right? charlie gasparino. the dow down about 158 points here right now. issues bucking the trend include travelers, goldman sachs, pfizer, despite the crackdown we are doing on drug suppliers who overcharge and then shock you with the bill. the president wants to make it a more transparent process. pfizer would be among those companies that would have to be more transparent. more after this.

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my son is a good person. my son testified for hours and hours. my son was totally exonerated by mueller, who frankly does not like donald trump, me, this donald trump. and frankly, for my son, after being exonerated to now get a

subpoena to go again and speak again after close to 20 hours of telling everybody that would listen about a nothing meeting, yeah, i'm pretty surprised. neil: all right. the president was surprised not only because donald trump jr. has been asked to testify, but to a republican senate committee. washington examiner commentary writer joins us. what is this about, do we know? >> at this point, the only things we really know is that the closed senate hearing that donald trump jr. testified in 2017 whand what seemed to come t of that is he sort of downplayed or had a lack of awareness about the trump tower moscow project. now, fast forward to february 2019, michael cohen is testifying before the house judiciary committee, in which he says that he briefed both donald trump jr. and ivanka trump about

the trump tower moscow project during the 2016 election, and there seems to be a bit of a discrepancy there and it's possible that that is what they're trying to clarify right now. neil: so it's what they read in a report and the findings in the report that don't jive with his closed door meeting with the same committee, right? >> that's what it seems to be. you know, of course, people have thought that donald trump jr. might be going to jail, but i think in all likelihood that a criminal referral will come from a republican-led senate committee to the trump administration via the department of justice where william barr probably will not prosecute from there. but that's kind of a subpoena in and of itself is kind of seen as like the last stand right there, and the fact that richard burr would go to this is not sitting well obviously with trump or many republicans on the hill. neil: talking about the chairman of north carolina. were you surprised just by that aspect, this was a republican who was, you know, acquiescing

to this? >> i think many of us were surprised, in addition to president trump. richard burr is not really one of those outspoken figures who have criticized president trump. he has been sort of seen as an establishment figure and the fact that republicans have been sort of in lockstep behind president trump, the fact that he's kind of been running circles around many of his critics, many in the democratic party who have alleged that the trump campaign colluded with the russian government during the 2016 election kind of shows that republicans don't really have it all together right now. neil: you think he will be testifying to the committee? >> that's really tough to say, neil. it's possible that he will. it might be during closed door hearings, if anything. but you know, this might be the most we hear about it right now. neil: all right. great reporter and writer. thank you for taking the time. i appreciate it. >> thank you. neil: i want to get the read on all of this from judge andrew

napolitano. so much to talk about. i always like putting you on the spot. let's talk first of all about the donald trump jr. thing. i was stunned by that because it was a republican committee and all of that and maybe the inconsistencies that were implied here. >> well, there are two issues. in addition to this issue of trump tower moscow, in which there is testimony, again, we haven't seen it, under oath but in secret from michael cohen, contradicting what donald trump told the same committee in secret and under oath, there is also -- neil: you are under oath either way. >> correct. correct. there is also the issue of did your father know about the trump tower meeting before it happened, wherein donald jr. said no under oath, now you have michael cohen saying i briefed donald, the person who is running for president, about the trump tower meeting in the presence of his sons before the meeting happened so he definitely knew about it. so i think that richard burr,

not -- senator burr, who chairs the committee, is not looking to open up a can of worms and new investigation. they have already finished their investigation on russia. they just have these two contradictory statements under oath and they want to give him a chance to explain. he's not happy about it. his father's not happy about it. when i heard this this mornings i thought i heard it the wrong way. i thought it was the house intelligence committee. what i was reading, i thought was a misprint. i can't put my finger on it because senator burr and some of the members, republicans on that committee, are some of the president's staunchest supporters, question is there a there there or are they just trying to leave no stone unturned so they can say we didn't fail to look -- neil: what if the president says no, i'm not going to have my son testify? >> then we have a similar clash like the house judiciary committee is having. neil: therein lies the constitutional crisis question. >> i knew you wanted to go there. neil: what is it?

>> i don't think it is a crisis. i think it is a potential clash. a crisis occurs, in my view, i don't want to split hairs over terminology, but this is the language that chairman nadler and speaker pelosi used in the past 24 hours, a crisis occurs when the court prevents the congress from doing something it does anyway or orders the president to do something he refuses to do. then you have a constitutional crisis. right now, we have a clash but we have a means of resolving the clash and that's the courts. i said to our colleagues on fox and friends this morning, there was no reason for yesterday. you get a subpoena that you can't comply with, you don't sit on it, you don't complain about it. you take it to a judge. ask you the judge to quash it or modify it and the judge would say give me the redacted portions, i will read them and i will decide what gets out there. crisis passed. neil: what if the supreme court ruled unanimously richard nixon had to hand over the tapes? he did, correct? >> correct. neil: so when was there a constitutional crisis?

what triggers it, when the president refuses? >> correct. if he had refused to turn over the tapes, notwithstanding the order, then there would have been the crisis. if a federal judge says bob mueller's got to testify, the report is going to be released without redaction and somehow the president tries to stop that, then we have the crisis. then somebody's got to give. neil: yeah. the bob mueller stuff, as far as i know, the business conflict apparently goes back to a golf club membership. >> it's not a conflict. the standard the president was using most respectfully to the president, the standard the president was using was the standard that applied to judges. he even said during his hypothetical you have a judge who did this, a judge who did that. he's right. that is not the standard to apply to prosecutors. neil: but the charge was that mueller wanted to leave this trump country club, wanted to get a refund, and that you know, he had petitioned i think even donald trump at the time. >> this is long before -- neil: yeah, i'm going back to

2011. not a big issue. >> not a conflict at all. listen, prosecutors are often not neutral. they often hate the target because they believe the target is guilty. they leave it to the courts to be neutral and fair. neil: i did notice when you were on "fox & friends" you brought flowers and cake and all that. >> is today your birthday? neil: no. you thought you would maybe bring canolis. >> what's another thing you like? neil: an entire pizza. >> next time. neil: he's scary smart. scary wicked smart at the same time. >> god love you. neil: much more after this. the dow down 138 points. stay with us. hi, i'm joan lunden with a place for mom,

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neil: all right. well the markets are betting at 12:01 tomorrow it happens. tariffs go into effect on host of goods. $200 billion worth. more than 6,000 goods. think about the trade war, whatever you call it, a year ago, affected a dozen items, maybe max, steel, aluminum all of that. now furniture clothing handbag, luggage, electronics. here is what bugs me, meat processed cheeses as well. as if america, we got to stand up strong here. shampoo, perfume, dishes, deodorant, how will it get so

bad, that people say i can't. it could get ugly. 12:01 a.m. i'm thinking charles payne's office and mine are very close. we might have to pitch in. i don't know, buddy, this could be a rough one. charles: the french can make it without. which can too. neil: what am i worried about? charles: i'm charles payne. this is "making money." stocks off the lows of the session as president trump says a china trade deal could actually get done this week. those talks, by the way, those long-awaited talks begin today at 5:00 p.m. plus the socialists are at it again. we break down the latest plan unveiled today by bernie sanders and aoc, this time targeting credit card companies and banks. big tech behaving badly. stop me if you heard this before, google, facebook, amazon, as well as twitter all under fire this week for variety of reasons. will it ever end? governor mike huck