the land mass of all the continents combined. now you know. everybody, we're bringing back fan friday this week. send us your videos. all you you have to do take a vo of yourself tell us your name, where you're from, this is important, you have to say you're watching varney and company. you never know, you might be on television. fan friday is back. neil, it's yours. >> stuart, this is neil cavuto. i live in new jersey, i have to wait for friday, right? got it. good luck on that. thank you, stuart, very, very much. let take a look at oil prices, shall we? they are slipping a little bit even as oil executives are grilled. something interesting, the oil reserves we had announced today were a little higher than thought. now we're getting a better idea who is going to be tapping those reserves. we're learning that iea members, international energy association members, are going to be kicking

in a lot. president biden said he will tap the reserve by about a million barrels a day maybe for 60 days. now we're learning from the iea, they're kicking in 120 million barrels over that same period. so you know, obviously that will be a lot of oil flooding the market at the same time. now keep in mind all of these numbers are but a fraction of our overall demand, that is about 100 million barrels a day. but it is an excuse to sell. that is what we're seeing. so we're coming off of that. the dow transportation average not benefiting from this. you would imagine with lower energy prices anything that feeds on fuel would be maybe looking positive to those developments. not today as our own charlie brady, our our stocks he towards pointing out. this may be the market will go under the dow theory. swoon last six down trading days

in a row it surrendered 13% in value. there is a theory out there, the dow theory says as these stocks go like truckers and rail concerns and marine operators and the rest, it spills over into the rest of the economy t doesn't always, but i hasten to add it is out there. the other development is in washington has a lot to do what is happening on the energy front. in fact everything to do what is happening on the energy front. that is the rocketing of gasoline prices and congress asking the big oil executives whether they're behind it. in fact the title of today's powwow, well, is that, that they are behind this rig in prices. hillary vaughn following all of that on capitol hill. hillary, how is it going? reporter: neil, house democrats made it clear they think oil companies are to blame. they are price gouging americans at the pump, hoarding supply,

refusing to pump more all in an effort to increase their own profits. >> fuel prices are impacted by a number of factors. crude oil -- >> you don't agree crude oil prices are high because there is less supply? >> crude oil prices are high because there are concerns about potential disruptions to future supply. reporter: top executives, from shell, exxon, bp, chevron addressing accusations head on about price gouging going on right now. today oil executives are not just denying it but also told lawmakers they have no control over prices at the pump either. the committee chairman, frank pallone, tells me today though he is not buying it. in the oil company testimony they say they don't set the price of oil. they don't set the price at the pump. so if they're not price gouging then who is to blame for high gas prices?

>> they're not being honest with you. they said the wholesale price. the wholesale price is 60, 65% of the retail price. so that is not accurate. reporter: several of the companies today also making the point to lawmakers they don't own or operate most of the gas stations in the country. a lot of them are mom-and-pop operations. in fact the president of shell saying it would be illegal for them to take control of individual gas stations and manipulate the prices there. aaa estimates gas stations make only 2 to 4 cents in profit off of ever gallon. their spokesperson says gas stations make more money selling a cup of coffee at a convenience store than they are on a gallon of gas. neil? neil: i could not understand what congressman pallone was saying. no idea what he was saying. sounded very convincing saying

it. thank you very much. peter doocy right now at the white house looking at the administration's plans slapping more sanctions on russia. i thought we had run out of sanction opportunities, peter, but i guess not. what is the latest? reporter: no. kind of more of the same. what they are doing, neil, they will ban new investment in russia. then they are going to block, do a sanctions block on two russian banks, but the thing is, one of these russian banks is already saying this isn't going to affect them. spare bank is in a statement to reuters saying that the sanctions will not have a significant impact on the banks's operations and will not affect service to russians as the system has already adapted to the previous restrictions. and that is part of the reason these sanctions are really underwhelming to some lawmakers in town. >> seems like we're reacting instead of acting. these sanctions come on the heels of what we saw was unspeakable tragedies and

atrocities being committed in ukraine. why we're waiting until these atrocities happen before we ratchet up the sanctions? reporter: but this president joe biden has no plans to put u.s. troops in ukraine no matter how bad things get, even as top officials admit these measures are not going to take effect right away. >> you're adding more sanctions, saying that the sanctions will take time to have an impact. how much time do you guys think these innocent ukrainians have? >> what is important to note here sanctions are just one component of tools we have at our gist postal. what we're doing, wee eseeing the financial system of russia is at the brink of collapse. reporter: as we follow the evolution of the way the white house describes these sanctions there is something new. remember initially sanctions are meant to deter. then it was sanctions were never meant to deter. now they're saying that these sanctions are meant to deplete putin's resources.

neil. neil: so the other de word, deplete, not deter. thank you, peter doocy at the white house. we've already gotten indications from ukrainian president zelenskyy is in it for the long haul and the fight but he still need as lot more of everything from humanitarian aid to military aid. a country making sure to can offer any and all help possible is estonia. estonia became a nato member in 2004. there is a great deal of attention to ukraine whether it wants to be a nato member now. president zelenskyy raised the possibility that it is not the end all, be all to become a nato member. it could be open to neutrality to getaway to get a settlement on the war. with us is the estonia ambassador to the united states. thank you, ambassador for joining us. this issue about potential nato

membership for ukraine, do you think that is vital for the conclusion of this war? that ukraine should be able to allow itself to join nato if it wanted to? >> thanks for having me, first. neil: thank you. >> and certainly estonia is strongly of a position that when it comes to nato membership then this is something to decide between nato and ukraine rather than any third parties and estonia strongly advocates for nato's open door policies. every country that is fit and interested in becoming the member of nato should be able to make the decision. neil: ambassador, recently you were in georgia speaking to a number of university students and the like talking about this whole nato issue and one of the things that came up, i don't know if it was a response to

questions, sir, was the idea that vladmir putin is looking at this as something caused by member-states joining nato too quickly and aggravating and making the situation very tense with russia. you argued that, and did not feel that was the case but he seems to be latching on to that. what do you think? >> vladmir putin has made up so many different excuses for invading other countries or doing other nasty things to other countries and to his own citizens. the nato argument is one of those outrageous arguments that he has used. what we see right now is that the, it is just a ruse. nato has not threatened anyone. nato is a defensive alliance and

the ukraine has not opted for interest in joining nato not because of the interest of threatening nato, of threatening russia but out of the fear for its own security. and what's happening right now in ukraine is only proof of, of this fear or the clear testament that russia is a threat to its immediate neighbors. neil: ambassador, do you think that president zelenskyy should fight hard to become a nato member? he criticized germany for preventing ukraine from becoming a nato member in the first place. there is a lot of back and forth on that i understand but that now, you know, other nato members, i'm sure estonia feels the same way, you might feel the same way, would welcome ukraine

but if mr. zelenskyy doesn't want that or has that as a bargaining item of ending this war would that be a mistake you think? >> again this is up for president zelenskyy and his people to decide whether they want to to have nato membership. neil: do you think, ambassador, i'm sorry i wasn't clear. do you think it is more difficult for russia to even consider invading ukraine, again if it were so inclined if it were a nato member just like he might think twice about doing the same to you and your beautiful country because you are? >> i'm absolutely confident that russia and russia's leadership do understand what's at stake when they have any ideas regarding invading nato countries. and i'm absolutely confident that they would not even try

this because that would be catastrophic for for russia. but again at this time as we see the primary goal for president zelenskyy is to push back the invasion of russia and we believe that the west has a very strong not only moral but political obligation and not only with russia but, not only vis-a-vis ukraine but also vis-a-vis our own people to help ukraine in every way we can to make sure that there is end of this war. the result is, that russia is being dealt complete and clear defeat in ukraine, that russia loses politically, military and economically out of this aggression against ukraine and, that the west comes out of this

conflict stronger than when the conflict started. neil: ambassador, finally, your country recently expelled i think 14 russian consulate staff and closed consular offices there i believe in response to the horrors in bucha. what was the reaction you got from russia when you did that? >> we have not yet experienced the military action to this particular step but we have be in a position to to expel the russian diplomats before. also during the last couple of weeks and they have, they have responded to that by expelling also estonia diplomatic staff. neil: ambassador i lied before. when i told you that was the

last question. i'm curious before, hopefully this war they have can find some way to end it peacefully anymore horror or bloodshed. will you maintain or is your country going to maintain that shutting down diplomatic relations with russia as long as vladmir putin is still in charge of russia? >> we're not shut down the diplomatic relations entirely. the embassy in our capital is still working. neil: okay. >> the russian embassy and their ambassador is still in the country. but more generally speaking we, we very clearly see that as part of the evolution of this conflict phase is also bringing the perpetrators of the war crimes, the people who are behind this aggression to be responsible for it.

so i don't see really ways how to deal with russia or go back to business as usual even after they pulled back their forces. there has to be a long-term, long-term responsibility taken for what's happening in ukraine and by russia. neil: ambassador, i want to thank you very, very much, the estonia ambassador to the united states. thank you, sir, very good getting your take what's happening now in ukraine. we're going back to this country in just a second here, get a sense what's happening right now, not only with gasoline and oil prices we showed you are declining a little bit, but what certainly is going on the mortgage front. mortgages now have popped over 5%. now that jarred a lot of folks. i could bore you with what my wife and i paid for our mortgage when we got our first home but i won't do that. it's high for a lot of people and it is jarring for a lot of

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♪. neil: you know it doesn't get a lot of attention in this country maybe because it's russia and the ruble and the currency that was virtual rubble a little more

than a few weeks ago kind of back to where it was before russia invaded ukraine and janet yellen, the treasury secretary was asked about that, whether sanctions, all the measures which had to punish russia are doing the job if all of sudden the ruble is back where it was? by the way so are russian markets close there to it. if everything is going more smoothly than we thought for the ruble and the russian markets what does that say about the approach taking to punishing russia? janet yellen says the russian economy is still reeling with sanctions. the market in rubles is not a free market. if you will, it is freely defying logic it would be pounded. for a while it had been, was at mere pennies on the dollar. well, a few more pennies on the dollar. sew we're following that. we're following interest rates moving up to over 5%. still very low figure for a old

fogy like me. i understand the seminal movement over 5% does jar a lot of folks for the conventional 30-year mortgage. gerri has been following this closely. i'm talking about gerri willis. she is taking a look how it spills over. reporter: it does have a he spillover. maybe not you and me but maybe people getting in the market now. it is a record breaking morning for mortgage rate. the average rate for the popular 30 year, above 5%. to be specific 5.02% according to mortgage daily. it was that level in 2018. a year ago rates were 3.38%. this increase is pushing down mortgage applications which are down 3% for the week, 9% lower than the same week a year ago. for buyers, wow, this is tragic. home prices are up 20% year-over-year. that is according to a monday

report by corelogic this is the highest level in recorded history. keep that in mind, a situation, double-whammy stalling purchases. the national association of realtors resulting that february sales fell 7.2% from the prior month. 2.4% year-over-year. of the four regions they track only the south recorded year-over-year gains. yea, that is where i'm from. mortgage rates follow the yield on 10-year treasury closely. comments by lael brainard yesterday that the fed should take action immediately on inflation, reduce the balance sheet, that sent rates higher. some experts said this is good news heating down a overheated market. real estate agents buyers are piling in. they believe mortgage rates only go one way, that is higher. fear of missing out, fomo, in this market f you want to see there is real estate platform

offering fractional ownership in homes, arrive homes, fully funding two properties in two hours. guess who is behind it, neil. just the amazon founder jeff bezos. that's all. neil: wow. he is pretty shrewd with investments. reporter: he is shrewd. he is a smart guy. neil: he needs to follow his gut because he is pretty good what he does. we have the did he devos managing partner that follows real estate closely. gerri touched on it, 5% is jarring figure when people were getting used go something, three something, four something mortgages. it is all about age and perspective but a lot of folks it is compounded by the idea home prices themselves are moving up smartly. if you're not getting in on the mortgage rate, getting it on the price front for the house itself. where do you see this hitting real estate, or will it? >> neil, good to see you.

i think that the demographic, that will suffer the most from this is the first-time home buyer. when you look at rates going up, you and i spoke over the summertime and 30-year fixed rate was hovering around 2.8%. here we are nine months later, we're 125, 130 basis points higher than that. coupled with that the prices only appreciated since the summer, even in the last quarter, they still appreciated even with volume going down, you know that high rate increase will really price out for some homebuyers when you talk about the price appreciation, the fact that now in the last 12 months, your average monthly mortgage paint is 28% higher than it was a year ago. it is essentially unaffordable for most people to buy an entry level home. neil: so what happens then? at the margin sometimes these can be very close, sometimes 1/10 of a point, half a point could do it to push you out?

i'm wondering do homeowners hang on through this, decide not to sell their house, thereby limiting supply again, thereby keeping prices continue to move high as mortgage rates are moves higher as well? in other words i guess i'm asking, some people see housing as bubble. i don't see things featured a decade ago in the last housing bubble. that it burst, loses a lot of air. where are you? >> you know, i actually, i think you're spot on. when you look at it, inventory is as low as it has been since the nutt '70s. what will force movement in the marketplace? creation of housing stock which labor shortages and supply chain issues will take several years. what will force people to sell? maybe they need to capitalize on appreciation and make profit. but then you have to relocate. where are you relocating too, likely refinanced in the last two years, secured a rate in the 2% range. now you will move, relocate. prices are appreciated and

you're paying double the amount of interest that you would, it will be a disincentivizer for many to move and sell. that will, i know the whole point of trying to increase rates is temper inflation, bring down pricing, correction, all the things that people say, quite honestly i think it will slow down growth. i don't think it will bring down pricing as much at all. at the end of the day we have the supply issue which is not being addressed. that is the most important issue none anything going on in the housing market right now. neil: pending sales, those who are looking at homes, whether it is hard data, anecdotal today takes it was not what it was, you wouldn't know that looking at places like florida, a lot of other high value locales, texas, but that it's starting. assuming we're off some of those highs are you saying that the growth just slows but the growth remains? >> you know, i think we created

a new normal in the housing market. i don't think price growth continues. i think it stablizes. maybe with a minor reduction. i don't think we're sitting here in any sort of bubble maybe in 2008, 2009, whatsoever. when you look at the percentage of down payment, how high down payments are, when you look at percentage of cash deals, percentage of cash deals is roughly 25% of all transactions are cash. neil: is that right? i didn't know it was that high. >> it's a staggering number. what does that create? so much equity, liquidity in the market it is not based on excessive credit, that was given out a dozen or 14 years ago. so i you know, to be quite frank, you know, i don't really see, you know, things having much, i don't see the appreciation continuing but i don't see this resulting in a significant reduction in price. neil: yeah, i don't see people sight unseen bidding on properties. i don't see them getting approved for mortgages and all without any proof of income or all of that. if you had a heartbeat that was

good enough in the past. i don't see any of that. sort of bubble type things you would see i don't see. >> neil, i can tell you as a real estate attorney representing, our firm represents 40 institutional lenders and hundreds of buyers and sellers on an annual basis, the banks are lending at a very healthy underwriting. helped something conservative. the down payments are high. there is none of the shenanigans that took place during the financial crisis that created the recession. that gives you a lot of high level comfort that this housing market is not a fabricated market in my opinion. neil: your opinion is pretty good. pierre, thank you very much. good catching up with you. the debass managing partner. taking a look at real estate. some similarities to bubbles in the past, but nothing approaching big bubbles we see in the past. perspective comes in order.

perspective on oil prices rocketing. all the big energy ceo's are in washington right now. they might as well just made themselves pinatas because they have become that. the very people questioning them, while pointing fingers at the oil guys, they don't realize they're pointing three fingers back at themselves. maybe they should. after this. ♪.

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so you wrote this. - yes. - thank you, edna. - [announcer] don't wait. see if a reverse mortgage is right for you. call now, the number is on your screen. neil: you're going of a company's profits when prices are high. why don't you extend that everybody? if laptop prices are high go after dell, why limit it to just the oil supplies. >> everyone needs gas. neil: everyone needs food as well. why not go after that? >> if they were price gouging at the same level and having

$40 billion in -- neil: are you saying, you have proof they're price gouging congressman? >> i have proof that they are putting a lot of their money into stoke buybacks. what i find unfair. why is it that americans out of patriotism are ask you pay six bucks for gas and oil companies are making recovered profits, congressman ro khanna, he is a fine, decent, patriotic representative, i take something away from him personally. price gouge something not buying back your own stock. blaming the oil companies, all their ceos have been herded to capital hill today, they're all serving various roles as human pinatas. someone not apologist for the oil industry, we have to realize what is going on here. forget just basic supply and demand issues, anxiety over a war. go back to when this administration started. we looked askance at the fossil

fuel industry. whatever your views on the industry that got the pal ball rolling where we would prioritize other forms of energy. you could make the argument why aren't we in all all energy. the argument was to start things off little less fossil fuel focus. the fear that the oil industry is interested in just making money. back to the other issue that has come up in these hearings today. we'll explore with a guy very big in the drilling business, this notion that they are making money. there is nothing wrong with deciding to make money and at these prices you would also be under the assumption that the industry would want to drill anywhere and everywhere it could and take advantage of any and all opportunities so it could continue making money. let's not you know, make this a pejorative. let's get the read on all of this from dan eberhardt. dan is chief executive per in

canary. very big in the drilling serviceses arena, one of the biggest. >> thank you. neil: when these oil guys are herded to capitol hill they know what they're in for. they're being blamed for all of this. as someone in the industry i am sure you don't think that is fair. but this perception that their profits are obscene, do you think their profits are obscene? >> absolutely not. i think this is kind of washington speak that doesn't really relate to main street or what is going on in the oil patch. look our costs have gone up consider i b the cost of a new truck, our costs of fuel to operate, costs of labor, getting stuff from china is a lot more expensive. our costs have gone up too. look, the oil moves, prices move on worldwide basis, that is the market we're in. that is the hand we're dealt. neil: glad you said that. understand these are priced in the open markets, much like stokes are priced in the open markets. oil is a commodity.

it is like a stoke. it is based on perceptions. sometimes it might be wrong but that's how it is done. every time the industry has been examined for cabal-like activity or rigging prices, not once has that ever, ever been proven. >> 13 times they have, the ftc investigated oil companies for price gouging and they have never, they have never found anything. look, the price moves on a worldwide market. the companies are reacting to market just like a fashion company would, just like a health care company could, they are getting return for investors. the costs are up. the costs are not what they used to be. right now we produce 11.6 million barrels a day last month. we produced 13 million-barrels a day in 2019. the economy is better. the oil price is higher. you would think we would want to produce 13 million barrels or more. we can't. we have supply chain issues. we have got cost issues and all kinds of difficult things. neil: the lease issue you hear a good deal about that. >> yeah. neil: sitting on land they could

be tapping. the fact of the matter we had more than 30,000 such leases more than a year ago. there are 9,000 now. they're not all tappable -- >> a lease is easy to get. the problem coming out of washington they don't understand is what we need is the permits. the permits under the biden administration are taking 45, 55% longer. neil: what happens, go slow route? >> they are slow paying permits, for last 15 months,. neil: when administration says other progressive said you could turn this and right now, is producing to your heart's content because you're not doing it because you're greedy, you want to keep the money because prices have gone high? >> i think the facts are different. the administration is trying to make change around the oil industry, not with the oil industry. the hearings on capitol hill today shouldn't be a pinata against the oil companies. it should be meeting with oil companies. we need more production, how can we all work together, give you a guys a tailwind to do that? the gas tax holiday is something

d.c. is trying to do outside -- neil: these are peripheral issues around the real issue, right. >> yeah. neil: cutting the gas tax, tapping strategic petroleum reserve are bandaids, and are not effective bandaids. >> they are bandaids are not working with the industry. we need more demand and more supply. the administration needs to provide the industry a tailwind to do that. the entire time they are providing a headwind. gas prices have not skyrocketed only when putin tried to wage this war. americans know that was prices are been moving up the entire biden administration. that is policy chilling effect. the reason our production is 1 four, million five barrels less than in 2019 when it should be even higher that is chilling effect from policy. that is the biden administration. that is what people voted for. that is biden day one will cancel pipelines. neil: not reversing any of that for the time-being?

no. neil: doing everything but. that is your concern. >> the strategic petroleum reserve. it's a bunch of nonsense, a temporary bandaid. that will in the increase supply in the medium term to help bring price down. neil: dan good seeing you. nothing wrong with an industry wanting to make money, that is essence of capitalism. to impugn an industry saying it is doing something illegal. we pointed out, i researched this, i will keep pounding it today, if there was a there, there, it would come up and these guys would be in jail. it hasn't. >> it's a show trial. neil: you could say that too. we have a lot more coming up including elon musk, overnight it becomes the largest shareholder twitter. what he is talking about doing right now, that is raising some eyebrows. after this. ♪. you can't buy love.

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♪. neil: elon musk if he needs the dough is more than 1 1/2 million dollars richer since his investment in the social media giant twitter. twitter management wasted little time welcoming him to the board and to pick his brain for ideas. we're told elon musk has a lot of ideas going forward. will one of them be bringing back donald trump so he can use the site and tweet away? let's get the read from ray wang, constellation research ceo. ray, what do you think? i mean he keeps his cards, political cards close to his vest. he is very critical of joe biden. hasn't said much one way or the other about donald trump. i'm wondering as far as a good business strategy, would welcome and urge twitter to welcome back the former president. what do you think? >> i think it's a little bit broader than that. this is really about freedom of speech, misinformation, getting

balance right, diversity of thought, versus bias against conservatives. it is really about expanding what twitter's business models are, in terms of out there, broadcast, communities, in terms of what they have been doing. part of it, we need to exercise a little more freedom of speech. he is a free speech absolutist. it might include bigger things reinstating conservatives that have been banned on twitter. neil: i know he is very critical of that. he doesn't like picking and choosing process of twitter. he is critical of other social media giants with the same bias. i'm wondering if he would be open to idea of edit button on twitter? >> he is big on that sometime. parag has been trying to get out there. he is the engineer now ceo. the exciting parts of twitter, way elon's mind works, a.i.,

automation, trying to get humans out of the process that might be the potentially discussion they're having on the product strategy and product road map out there. neil: thank you, ray wang. sorry for the truncated time with all the other developments. draw your attention to corner of wall and broad. we're in and out of the session lows not only for the dow, s&p and the nasdaq but growing concerns as well about this latest oil report we got and the fact that we have a lot more supply than we earlier thought and now we're getting word that we're going to spill a lot more oil opening up the strategic petroleum reserves around the world. more after this. ♪. new projects means new project managers. you need to hire. i need indeed. indeed you do. when you sponsor a job, you immediately get your shortlist of quality candidates, whose resumes on indeed match your job criteria. visit indeed.com/hire and get started today.

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don't use if you're allergic to cosentyx. before starting, get checked for tuberculosis. an increased risk of infections—some serious —and the lowered ability to fight them may occur. tell your doctor about an infection or symptoms or if you've had a vaccine or plan to. tell your doctor if your crohn's disease symptoms develop or worsen. serious allergic reactions may occur. it's good to be moving on. watch me. move, look, and feel better. ask your rheumatologist about cosentyx. neil: is blowing up a tank that contains acid the same as a chemical attack? that's the debate back and forthright now on news that russia might have been targeting such tanks to unleash the fumes from them and maybe kill a lot of people. we just don't know. russia says that is not the case. gillian turner following it very closely in washington. reporter: neil, right now the state department and the defense department are telling us they are concerned about this, they are looking into it. they are very concerned they say about the potential impact that

this event, this chemical event could have on civilians in that area inside of luhantsk. we first became aware of ukrainian reports yesterday morning that russia hit a storage tank filled with nitric acid. i reached out to the state department. i asked them if they consider this to be a chemical weapons attack. here is what they told us. take a look. quote, we're aware of reports of this incident and we're looking into it as await further details. we're concerned about the harm to anyone in the vicinity that a nitric acid leak would cause. clear russian forces continue to bombard cities and critical infrastructure and commit atrocities. government expert explained their thinking to us this way, if the tank held fuming nitric acid and the intent was to release the toxic night go again chemical gas, then it might be called a chemical weapons event.

figuring out this was indeed a chemical weapons or not is indeed crucial. remember president biden himself recently drew a red line saying that the u.s. would respond in kind. listen. >> if chemical weapons were used in ukraine would that trigger a military response from nato? president biden: it would, it would trigger a response in kind. whether or not you're asking whether nato would cross, we would make that decision at the time. reporter: so the regional governor in luhantsk is sharing evidence of this attack on facebook. take a look at these photos. he also says, quote, nitrogen acid is dangerous when inhaling, swallowing, hit on the skin. when applied locally to the ice, nitric acid causes severe damage with extensive necrosis of cornea and leading to loss of vision. so neil, we're reaching out, staying in close contact with the state department on this today. we don't have an update for you yet.

we'll bring you an update as soon as we have one. we can tell you the regional governor in luhantsk is telling people to stay inside with windows closed, shades closed, lock and bolted if possible. neil. neil: gillian, thank you very much. drones are helping to discover how widespread activity of the russians is. enter my next guest, he is the founder of a company called teal. he was doing this back in 2014, founded the company as a 17-year-old at the time. so now by my math he is 21 or 22 years old, maybe 23, 24. the fact of the matter he is young and what's interesting about, and you can explain this better than i can, george, the technology here with your drones is a little different. not only can they work outside, they can work inside. but explain. >> that's right. thank you for having me on, neil. so when i started teal which is now a nasdaq company under red cap holdings one of my original

goals was to help save lives with american-made drones. today we're seeing a huge need for drones in ukraine as they proven to be one of the most important tools in modern-day war. having a fleet of drones can now be more useful than having just a few traditional big, and expensive vehicles. sew we believe drones are incredibly useful tools and are inevitably a big part of our future but the small drones coming from china everybody knows about just can't be trusted especially in ukraine where the locations of these drones and their operators are easily tracked by the russians which is extremely risky for any ukrainians flying them. because of that -- neil: how do you avoid the scrutiny that some of these other drones get? >> well, because of all of this there is a massive need for fully secured drones that can fly day or night and don't compromise the mission so right now teal is one of the only companies in the world that provides this kind of drone at scale, fully financed and has

essentially recession-proof customers and i really believe the technology will help save a lot of lives. we're moving quickly to send the drones to ukraine. we recently announced an initial order to deliver the first batches of our drones to ukraine with many more to come. >> partnering with anyone on this? >> this one was through a nato country which asked me not to specify their name but we're working a with a lot of different partners, with the ukrainian government to get the drones out there as quick as we can. neil: keep us posted, george. i apologize, don't have more time. igniting a great deal of interest. speaking of drones, i should point out here, we're getting word from reuters a small number of ukrainians are trained in the u.s. on the so-called switchblade drones that can be launched from the ground and hit airborne vehicles or planes or jets themselves but they have been getting training right here in the u.s. of a according to reuters. we'll have more after this.

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♪ ♪ neil: that was before. by the way, that song came before we kept pushing back the student loan payments that were originally required for the fourth time and now going until

the end of august. the biden administration is saying you can wait until the end of summer, a lot of people are saying will they really change that policy that closes to a midterm rex? -- election? probably not. the read from lydia hu following all of this this. >> reporter: hey there, neil. this is actually the sixth time that the biden administration has pausedded repayments since about two years ago and the onset of covid. as you just mentioned, they were scheduled to begin in may, but now repayments are going to start back up at the end of august. now, this move does not go far enough for some democrats particularly in the really progressive wing. they want all-out cancellation, but the extension of the pause on repayment is drawing criticism from conservatives who are concerned about ballooning deficit and rampant inflation. watch. >> here in this case paying or subsidizing focuses not making their -- folks not making that

their payments is contributing to inflation. he likes to call it the putin inflation, but t absolutely the biden inflation because of what he's doing on energy, spending, what he's done to the supply chain. >> reporter: some critics point out pausing student loan repayments may have made sense at the start of the pandemic, but now we have a number of economic indicators that they say just don't support the continuation. a record number of job openings, wages that are growing, low unemployment. they say it's time to restart these payments. the committee for a responsible federal budget points out that the people who are going to benefit from the pa pause are those mostly with advanced degrees who are likely to be higher earners, they should be able to handle these payments, i'm talking about newer doctors and lawyers. even though we're not talking about all out cancellation yet, the pause is already costing the government money. the group the committee for a responsible federal budget, they estimate that the two-year pause has already cost $100 billion. this additional four months will

cost an additional $15-20 billion because they're not collecting on the interest payments. neil: wow, that's a staggering amount. lydia, thank you very much. then there's the issue of those who have been paying off their student loans, their parents have. let's go to gianno if caldwell, fox news if political analyst and my next guest. podcasters big into making a lot of money, luke lloyd is strategic wealth partners investment strategist. gentlemen, welcome to you both. gianno, let's say you have been paying your student loans hearing about another defer ifment in loan obligations or payments, the sixth one a couple of years now. how, how do those people digest this? >> well, i'm sure many are pissed off, honestly. when you've taken out the loans, you with paid them off, you did so knowing you had an obligation

to begin with, and -- a legally-binding obligation that you continued with. and now you have many individuals who have 80, $90,000 worth of student loan debt or as one study said on average, the average household that has student loan debt is around $60,000, i'm sure you're thinking to yourself, hey, what about me? do i get a check for all the money i paid in? you don't. democrats are playing politics with this, and they will continue to into the midterms because they want younger people to vote for them. neil: likely a split among younger people. i don't know the conditions you have to meet to get a loan to put off for a payment delay, but, luke, if it requires that you've not made a payment in the last six months or what have you, you know, that might encourage encourage people to not make payments, and it could spread. what is the impact, do you think, on the our economy? just the cost, of course, people don't even fathom the debt these days, they just know we keep adding to it. what do you think? >> my biggest concern is the

long-term impact on the economy because my big concern with all these policies is the precedent this is setting in younger americans. this is teaching young americans tata you don't have to pay off your loans. it's teaching young americans that debt is good, it's something that's just made up and doesn't really exist. and it's teaching young americans the opposite of hard work. what about the people who worked their butt off to pay off their debt? what about the parents that sacrificed their lifestyle to save for the child's education in what about the kid in high school who worked their butt off to receive scholarships in college? look, talking about college, i have many great mentors in college, and one of them compares debt to a drug. the more you take, the more you want. and these kind of policies make debt even more addictive, so i'm very concerned for the long-term economy. and just last week, neil, we talked about credit card debt on its biggest quarterly increase ever, and this is exactly what taking on for debt looks like. neil: for a whole generation, this might become expected.

gianno, i've already told my kids, your mother and i are keeping everything, you're getting nothing. [laughter] sorry. but i do wonder what the spillover effect will be, because if you wait long enough or hope long enough, someone in washington might come to your rescue, and you might go ahead and keep taking out loans, keep taking out obligations under the belief that, you know what? i'll never have to pay this back. >> well, first and foremost, neil, i guess you're like bill gates -- [laughter] he's not giving his children much of anything, but you're not giving them anything, from a very wealthy man like yourself, i'm shocked. neil: whatever's left over, marinara sauce, a couple of jars, but nothing else. [laughter] >> i like those. save some for me, neil. but, you know what is interesting here, one thing that politico is reporting out today that the biden administration is taking away the thoughts -- defaults.

there's about 8 million people who defaulted, it usually takes about 6-9 months to refresh those. right now they're supposed to come out with details of the plan in the coming weeks, but this is another example of, yeah, the government's just going to take care of it. and that's what democrats simply offer, more welfare, more benefits, let's keep you on the system as long as we can. in this case, it's a little different in student loans, of course. but certainly, there's individuals who have done their duty, paid off their debt, and they're wondering, what about me? neil: you know, luke, it's interesting that it comes on the same day -- and we're going to explore this a little later in the show -- the oil company executives are being corralled, some say serving as human piñatas today because it's their fault we have these high prices. so no one all the way up to our politicians takes responsibility for anything that's happening right now. because that part is the trend as well. what do you make of it? >> it's a big blame game right

now. and the main problem is that politicians, they're incentivized to be short-term thinkers when in reality they need to be long-term thinkers. stimulus checks, child tax credits, pushing back loan payments, canceling debt altogether, they're all short-term policies that hurt middle class america in the long term. i mean, look, the economy is never going to be perfect. what's the point of throwing a band-aid on a bruise? sometimes it's better to let some of these issues play out and heal themselves rather than making them worse. the fact of the matter is we can't keep blaming covid. we're at full employment. inflation's running hot. the economy is already overstimulated. we don't need to cancel debt. we don't need more stimulus. in fact, the opposite needs to happen. the government needs to stop spending our money, at least the majority of it. neil: you know -- >> inflation, inflation, inflation. neil: gianno, on that point, a lot of people are looking at what's going on and saying the era of big government isn't only

here, it's sticking around a while because every, every new problem that comes up there's a government solution to police it or control it whether it's now, you know, with profit tax on the oil guys or whether it's just forgiving student loans by the thousands. this is picking up pace here. it's not slowing. >> and you know what? i think that's a part of the reason why people have begun to worship politicians in the government as if it's their god, because if the government is providing for you, i mean, that's typically what people consider to have god for in a sense. you know, it's very interesting to me, the money, the trillions of dollars we're spending whether it be what happened in the ukraine, the money that we're sending over there, the stimulus checks, any of these things that are occurring right now big government is not only here to stay, it's looking to expand every chance it gets. i'm against -- i was against the spending that we saw with donald trump, but the difference is the spending we saw with donald

trump, we saw a corresponding gdp growth which showed us it could be possibly taken care of. we're not seeing the same exact things here under the biden administration, and it's providing issues for not just us here today, but the children of the future. neil: i forgot, gianno, i didn't realize you've been very cheap for a long, long time. [laughter] got that. luke, i mean, while i've got you here, i wanted to get your thoughts on the markets and how they're digesting all of this and particularly the government and the debt that's getting bigger and the interest rates that are getting higher. it's certainly drawing the markets today -- i'm not saying one day does a market make, but what do you make of what the markets are telling us? >> well, it's the same story that we saw over the past couple years. the market loves stimulus. they love spending money because it's going to prop up equities, and stock market is a hedge against inflation, right?

but what's the problem there? who owns stocks, right? majority of americans are not -- their lifestyle's not based on the stock market. their lifestyle's not going to change based on the stock market. so what we're really doing is trading off the impact of middle class america hurting for, you know, the top 1% to continue to make more money. if you place your investments properly in the market. i think the question you ask yourself is how sustainable is this over the next couple of years or even the next decade. inflation keeps running hot, it's going to eat into middle class americans' pockets, and they're not going to be spending money as much as we see right now, so that's going to impact earnings in the stock market. in the short term, i don't think this is going to impact the stock market in a negative if sense very much, but in the long term these are issues we're going to have to continue to deal with if we continue to go down the path of bad economic policies. neil: i don't know, these days, guys, long term is, like, lunch tomorrow.

[laughter] i guess i'll just have to play it day by day. guys -- >> come on, neil, you look great. neil: yeah, yeah. thanks, guys, very much appreciated. all right, in the meantime, talk about the new environment we're in where you just blame anybody but yourself for what's going on, including the runup in gasoline prices and the congressman who thinks it has nothing to do with what's going on in washington and everything to do with the people they are blasting, the oil companies. do you think in this environment, let's assume all the oil guys are greedy s.o.b.s, wouldn't it be in their interest to keep it coming, to keep drilling like crazy and take advantage of that? if it were in their interest to just leave it aroan in a high environment -- alone, they'd want to keep it going, right? >> neil, actually, they don't because wall street is telling them that they want to pocket the profits, that they don't want them to increase in more production, they haven't been

increasing production over the last couple years, and they're still not increasing the production. so they're profiting -- neil: production's still at a record level, right? we had a catch-up here with a slow economy that didn't address that, but there wasn't a lot of crying for the oil guys when they weren't making a lot of money. i just think you're choosing, picking and choosing, you know, your moments when you say they're making at lot of money right now. ♪ ♪ you know liberty mutual customizes your car insurance, so you only pay for what you need? like how i customized this scarf? check out this backpack i made for marco. only pay for what you need. ♪liberty. liberty. liberty. liberty.♪

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>> nothing wrong with making an honest profit. but as gas prices have soared, your companies have funneled record profits back to shareholders. will you commit to increasing production but also reducing dividends and buybacks in order to lower prices for struggling american consumers? >> we are increasing our production, as i said in our prepared remarks. investments that we've made -- >> well, i need a yes or no. so is the answer yes or no, mr. woods? >> we will increase our production, yes. >> but you're not going to -- that means you're not going to reduce dividends and buybacks. well, that's unfortunate, because we need you to do that as well. neil: public companies are owned by shareholders, and shareholders who take a stake and a bet on a company want

something for their bet on the company, so if you curtail payments to them, you curtail the very ability of those companies to continue doing good stuff for them. but leaving that aside, congressman kelly armstrong here, nowpped republican who sits on this very committee where a lot of this industry grilling was going on. and i don't mean a this in the drilling for oil, just drilling the executives. congressman, i don't know where to begin here because i think that, you know, they're make ago bogeyman out of the wrong, the wrong guys. what did you think of the tenor and tone of this? >> i think it's gaslighting the american people, first of all. none of the witnesses there actually own gas stations, and the way the market works at all of those things. but you have an entire group of democrats on this committee who for years have to told the oil companies to quit investing in fossil fuels, done everything they can to delay and defeat the permitting and the infrastructure needed to deliver these products to market and now

essentially are drilling oil companies because whether it's wall street, investors or the permitting regime, make it more difficult to put investments into the long-term capacity into developing energy from states like mine in north dakota. neil: i try not to take political sides on this, no one cares what my if opinion is, that's why i don't give it. but my first inclination was i'm hearing a prominent democratic congressman say drill, baby, drill, you should be beefing up production, beefing up production. the opposite of the stance when this administration started where the emphasis was going to be on alternative forms of energy. which is fine, but they did it at the expense of prioritizing fossil fuel technology and, clearly, clearly sending a signal that that was passe and bad for the environment. now they're saying, essentially, drill, baby, drill. i'm confused. >> the very same democrats who introduced the bill and voted to ban hydraulic fracturing are now demanding those companies

continue to produce from the very things they trieded to ban. and this wasn't ancient history, neil, this was last year. these are the things that are going on, these are the reasons that companies are a little less likely to invest in long-term assets. i mean, i don't remember democrats calling a hearing in april in 2020 when wti was trading at -37 a barrel. when every signal you get from the party in control in washington, d.c. is that we don't like your business and we are going to do everything we can to defeat your business, you can't come back and hold an oversight hearing and ask them why aren't you investing more in your business. neil: i do wonder as well, i worry about the message this sends where you are engaging in industry profits, that's too much money, then do you go after philip morris that has had to pass along food prices or cadbury schweppes or a host of other companies that have been making a lot of money and all of

a sudden saying, now that's too much? i just wonder where it goes. >> and i think that's one of the things i've been frustrated in my three years in congress, you know? there truly are too many people out here that simply do not believe in capitalism and in how works -- neil: then they should just say it. we think capitalism has failed us, we think you have failed us -- not you, congressman, but others have failed us. so end it all. just say it. >> and far too many people out here think the only problem with socialism is that nobody's just gotten it right yet, and history has proven that wrong. we develop some of the best, cleanest energy in the entire world. let us do it, and we can deal with these things, but democrats in washington, d.c. have to send signals to the market that they're okay with this type of infrastructure, or it's never going to happen. neil: all right, thank you very much. good having you, congressman. we'll see where all of this goes. i wonder what larry kudlow thinks of this? he'll be joining us later, as well as charlie gasparino, get

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neil: when you were referring to blackmail opportunities, were you sawing blackmail opportunities for china regarding president biden? >> well, it's just a concerning question that i think's legitimate based on the fact that hunter biden and james biden are have been in business relationships with chinese business people. there's people with the biden name, and it looks like they have chose relationships with people that are in the national security interests of the united states, i think it's a legitimate question to bring up. neil: and senator chuck grassley is looking into that right now, all of hunter biden's business dealings, because they're quite widespread and, apparently, quite lucrative.

mike emmanuel has more in washington. mike. >> reporter: fox news has uncovered february 2017 e-mails about getting joe biden to write a college recommendation letter for the son of a chinese business partner of his son. quote: hunter asked me to sent send you a copy of the recommendation letter that he asked his father to i write. it isn't just the president's son hunter, there's also the president's brother, james. >> there could be no doubt that james biden was financially connected to the corporations and the individuals with extensive links to communist china. and that he and hunter biden were in it together. if. >> reporter: wisconsin republican senator ron johnson says in late 2020 these concerns were dismissed by much of the washington establishment. >> perhaps the most egregious behavior came from 51 former

intelligence agency officials who relate their names and reputations -- who lent their names and reputations to an effort designed to convince the american public that hunter biden's laptop had, quote, all the classicker -- classic here marks of a russian misinformation campaign, end quote with. >> reporter: white house rest secretary jen psaki ensis that isn't necessary. -- insists. >> the president has never had a conversation about any investigations into any member of his family. he said that during the campaign, and he will continue to abide by that. so i point you to the department of justice for additional steps they would make -- take, they would make those independently. >> reporter: pressure is building for a more independent review. neil? neil: mike, thank you for that. mike emmanuel in washington. i want to go to charlie gasparino right now, taking a look at the federal reserve and particularly, i guess, some of the concern that it might mean

what it says, that it wants to get ahead of this thing and hike rates maybe more aggressively than we thought. what's the fallout, charlie? >> i agree. i would be remisses to say that my dad pulled a lot of strings to get me into pace university. [laughter] he paid the $25 application fee. i have to thank the him -- [laughter] and i am a proud graduate of pace if university, i want you to know. i learned a lot at pace including about inflation. obviously, it seems that the federal reserve did not, the chairman did not learn about inflation until too late, and now we have pretty significant inflation, and we have worries across wall street particularly in the ceo class, the jamie dimons at jpmorgan, the larry finks of blackrock, that inflation is bad, and it could lead to something known as stagflation where you have, at the same time, you have a slowing of -- you have rising prices and then slowing of the economy. i will point out that at the big banks what they're talking about

is stagflation definitely hitting europe. and the reason why it definitely hits europe is they were so dependent on russian oil that you're going to have now with the sanctions and the oil being cut off, you're going to have rising prices, and that rising prices is going to scale back demand at some point. so you go into an economic -- you go into a recession. so stagflation is coming to europe if you listen to the ceo class here in the u.s. it's a question mark here in the u.s., okay, whether it hits us. it could hit us. and that's what they're saying. if they were going to lay odds, i'd say when you talk to these ceos, they're saying like a 30% chance we could get stagflation with a recession towards the end of the year as the fed starts raising rates to try to quell inflation. prices don't go down that fast at first until you really do get a recession, and then at the same time for a period of time you have both higher inflation and higher -- and a recession.

something that, as you know since both of us are old men -- [laughter] in the '70s. you know, the '70s is ancient history when i talk to the kids, neil -- neil: i know. >> theyty -- they look at the 1970s as the 1870s. it's all about perspective. but, you know, that's where we are right now. the word stagflation is starting to seep out there, and that's not good for the markets. and, neil, the reason -- and, listen, you know, say what you want. being a fed chairman is not an easy task, it's not scientific, there's an art to it. he clear -- jerome powell clearly missed the boat. i mean, you know, probably way too much monetary on top of fiscal stimulus this time last year, so you can't stop the fiscal stuff. that's coming from the white house. neil: right. >> joe biden owns that. but the monetary stuff he can own, and it's going to be -- it could be a rocky next couple of months here. or if the stars align right,

neil, we'll have what's known as a soft landing. we can only pray for the latter. neil: that is a rare moment. you never mentioned your graduate school work. >> yes, i happened to go to the university of missouri, one of the best journalism schools in america. i leave that out because i want people to think i'm a man of th- [laughter] this shows you how crazy i was, i went with a bag of clothes and a typewriter. and i was living in the freshman dorm just to save money. [laughter] neil: one of those smith corona type writers? >> that's it. and i still haven't learned how to type. neil: you have a fast mind, my friend. charlie gasparino on that. another guy, larry kudlow and his hit show, i wonder what larry thinks of this, the markets racing from maybe rate hikes that are going to be a lot

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neil: all right, well, it's not the covid, it's the crime. 6 out of 10 new yorkers, specifically new york, new yorkers -- big with apple workers -- want out. they don't want to come back into the city. they don't want any part president of the city. they want to bolt. and, again, it has nothing to do with covid. that might be sort of a backdrop of anxiety with crowds all getting together, but it really has to do with crime and just the style of life, it ain't their cup of tea. karol markowitz knows it well. "the new york post" columnist made the move herself, kind enough to join us right now. you were ahead of this curve, but now a lot of people want to join you. what do you tell them? >> yeah. you know, i have to disagree with you a little bit. i do think that it's related to covid because i think a lot of new york city's problems are

related. new york remains consumed with covid mania. 2-year-olds still masking, it spreads fear. people don't want to return to the office, therefore, streets and subways are more empty, therefore, crime can spread at a pastor level than it had before. so i think all of this is very much related. if they don't get over the covid just mania, i don't think that new york comes back to normal. and part of that is, i think, crime continues to grow. neil: the crime thing and whether it starts with the covid thing and just unsure about being here period, i see that, i get that that, i'm just wondering where this goes. there have been similar fears, for example, very different conditions, i grant you, after 9/11, after the financial crisi- >> right. neil: -- would new york always be the same. it always a comes back. >> always. neil: this has been a tough sledding here, but what do you see happening? >> yeah. is so the thing is that i was there in 9/11, i was there for sandy, i was there for the financial crisis, i was there for so many things in new york city, and i never once thought

about leaving. this is something entirely different. this is really -- i saw it as the city had changed from the kind of city that i had known my whole entire life, i grew up in brooklyn. i mean, i was really just a new yorker forever. and i think that it's very difficult to say that the city comes back unless they face a lot of the things that have gone wrong over the last two years which i don't think they're ready to face. and i think the policies that have led to higher crime over the last, you know, decade -- it didn't just start happening, i think it was a lot of policies continued and made it this way, and they're now coming to fruition. and new york maniers know it's going to be very, very hard -- new yorkers know it's going to be very, very hard to get back to where we were. do new yorkers have the willed to do what rudy giuliani, for example, did? i don't know. neil: where's home for you now? >> i'm in south florida. could not be happier. wake up every day with a smile on my face. come visit, neil. neil: low taxes, everything else, but it's getting crowded

there. so you're putting up with other issues because a lot of people have followed you. hey, karol moved here, so we want to follow. did you ever feel that it could start dealing with the same issues of just crowds and anxiety and everyone -- [laughter] all from new york, you know what i mean? >> they do drive poorly. [laughter] well, is it a joke, neil? it might not be. of course it's getting crowded because people want to be in florida, of course, there's some concerns about housing and stuff like that, for sure. but, no, i think lots of problems that i see new york going through are not relevant to florida. i think they have a much more state approach to so many things, including crime and covid. i think it starts with governor desantis, but it's not just him. it's floridians in general. they have a standard for their way of life here, and they're really going to fight for that standard. i don't think they need to worry that people who are coming from new york are going to vote wrong, as i hear all the time. the people who are coming here,

they know what florida's all about x they know that they want to preserve it too. neil: if everything's green. it's always green, all year round. karol markowitz, new york post -- >> neil, so nice to see you. neil: same here. she can have the best of worlds. larry kudlow will be joining us soon. larry has a great mind, but how prescient he's been, the federal reserve falling behind the curve when a lot of people were wondering what's the curve, he's here now especially amid fears that the federal reserve might go the ore way. -- the other way. after this. ♪ ♪ ading platform. it's an entire trading experience. with innovation that lets you customize interfaces, charts and orders to your style of trading. personalized education to expand your perspective. and a dedicated trade desk of expert-level support.

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muck. neil: all right, sometimes presidents can kind of tip their hand, your -- you're not surprised when you hear them say what you long thought they were just thinking. the president wrapping up remarks says, amazon, here we come. obviously, making a reference to the staten island facility that had gone union and maybe hoping to see more of it down the road which immediately got me thinking about my friend larry kudlow, the former top economic adviser to president trump and now, of course, the hit show

here on fox business. and, larry, i'm thinking, well, now we know what he's thinking or confirming it. he wants to see a lot more of that, and he just might. what do you make of what's been happening between starbucks and amazon and, of course, the push now even at companies that are very generous to workers still seeing this. >> i think, look, the president's pro-union views are well known. and they tried to write a lot of that into the build back better legislation that was very controversial. and a lot of people, obviously, didn't agree with it. i would still say even though there are specific examples such as amazon on staten island -- now, you know what's an interesting one, neil, amazon battle in alabama. big battle. and they forced, national labor relations board, i think unfortunately, forced a recount of the original vote when was 7e union. alabama's not the same as new

york city. we'll see how that turns out. the other point i want to make is the trend in recent, really quite a few years is right-to-work with statements. i mean, michigan voted to become a right-to-work state. and so i think it's 26 right-to work-states, so it's a little more than half the a states. i think this stuff is kind of a losing battle. i don't think it's healthy for construction, infrastructure. frankly, the costs, the work rules, the regulations that come with a union shop are very own yous. -- onerous. neil: you would think it would happen in an environment where workers are misfleeted or way under-- mistreatedded or way underpaid. that's certainly not the case, so it kind of defies the traditional logic you have. >> this is a time when wages are booming. you know? you could make the case, as was occasionally made in the '50s and '60s and '70s, that

unions were there to give you better wages and benefits. but that has really passed. apart from the gig workers which is also a controversial matter. but, look, wages are booming. i'm glad of it, by the way. prices are rising even faster, and they're just trying to keep up. middle class wants to stay even if they possibly can. i think it's going to be a losing battle in the next couple years. but, you know, the union -- we will see. we will see. i just think that private companies can do it better, and i think workers -- here's where the rubber meets the road. workers should have the freedom to choose. no arm-twisting, no funny business in these ballots and elections. let workers choose whether they want to pay dues to the union which comes out of their paycheck and then all too up, union, these unions have left-wing agenerals da in washington, d.c -- agendas. many times the administrators

are way to the left of the rank and file. the rank and file votes republicans, the administrators are all progressive democrats. neil: that was the case with the afl-cio. >> right. which was not always the case -- neil: not always, no. >> when i was in washington the first time with reagan, lane kirkland was a pal. he was a staunch anti-communist, he had a lot of conservative socialist views. that doesn't mean he wouldn't fight like hell for wages and benefits. unions are way to the left of where they were two generations ago. neil: let me talk about the federal reserve here because you very early on were saying there's nothing transitory about inflation, and this won't be any different. now we're hearing out of a number of fed governors and district presidents as you know that, hey, we might have to up the ante here, raise rates more than thought and a lot more often than thought. the markets don't noaa -- know

what to wake of that. what do you think? >> well, i think the markets were very surprised yesterday e when lael brainard gave a very hawkish -- neil: right. she's considered a dove, or was, right? >> i love her because in her nominations testimony she was repeatedly asked if she was a capitalist, she wouldn't answer the question. [laughter] i mean, come on -- neil: wow. how times have changed. dirty words. >> she would not say she's a capitalist. okay. putting that aside, she scared the heck out of stock markets yesterday. and i think -- neil: because of these more spartan views -- >> yes. we'll get minutes sometime, 2:00, 2:15 today -- neil: from the march -- i'm sorry, the meeting where they hiked -- >> yes, sir. they've going to show a much more awe depressive fed, i think they're going to show a fed that

will put big caps on future purchases of bonds. they're going to have a runoff of their bond holdings. the fed went from 4 trillion to 9 trillion in, basically, two years. we've never seen anything like -- neil: can they get rid of that? that's a big number. >> it's not going to be easy. we talked about in the past i do not think this is going to end particularly well. i was -- so that's what they're going to do. somebody was telling me today, smart people, a $60 billion cap on what they reinvest. we will see. i think they have to be super aggressive, they have to raise the target rate probably 50 basis points if it were me, i would volcker-ize that and put it up a hundred -- neil: yeah. one point at a time, remember that? >> absolutely. volcker taught me all about regime change -- [laughter] and i love that. neil: you come from the new yorw york fed, right? >> i was his secretary assistant go-fer at the new york fed.

do you know conrad -- neil: absolutely. >> one of wall street's best economists. i was at open market operations at the new york fed, neil, almost 50 years ago, 1973-74 -- neil: come on. >> it's the truth. i was right out of princeton. i worked at bank -- i was volcker's kind of secretary, speech drafting, secretary, and we met up again when he was fed chairman and i was at omb. we need a volcker e moment here to change the outlook -- neil: well, he was so blunt and direct. i don't know if we could deal with something like that. >> one of the great things paul volcker used to do besides tough, you know, pulling back on the money supply, strengthening the dollar -- and it was painfuy before congress and beat them up over deficits and -- neil: right. >> -- deficit spending. and you don't hear that now. i mean, jay powell, who's a friend, lunch all the time, he doesn't do that.

he went along with all that stuff. volcker would say, no, no, no. remember, they had great deals a number of times in the '80s and the '90s, and volcker would be called in, what's your number, paul? what could you accept? fed chairmen ought9 to say there's a link between budget deficits and deficit spending and money creation. we've thrown that link out, and a that is the root cause -- neil: you need someone who's brave too, because he put his name behind -- >> also true. neil: -- and, you know, that's bravery you don't see these days. i'm just curious how far does the fed go? we have to be at a fed funds of close to 5% to beat back historical norms. could we get that high? >> we're gone that. neil: really? >> we're gonna. if gdp deflater rate, fed looks at that personal consumption deflater, 6-7% right now.

it's not the cpi, it's not quirky. it's the basic underlying inflation -- neil: and it's got to parallel that, right? >> you want a target rate that's a couple of percentage points above that. neil: whoa. >> so you're looking at, just ballpark here, we're having fun on a wednesday, neil cavuto show, my honor, you're looking at a 6-7% fed funds rate before this is over. very good article today by william galston, very smart guy, he was quoting the ezra kline interview with larry summers, and summers is saying, look, you're going to have the next few years 5% inflation, 5% unemployment, which is now 3.5, and it's going to end in recession. neil: what is the deal with summers? he's really gone after biden almost from the get go. >> you know, i've known larry going way back -- neil: yeah. >> i just think he's being honest. i think he's being a smart fella. he and i don't always agree,

lord knows, but i think he's being smart. i think he called this pretty well. and what galston was saying, you know, summers 5% unemployment, 5% inflation, that's classic stagflation and it'll end in recession, and i don't think any of that's built into the markets right now. but, neil, you know me, i'm a -- look, the cavalry's coming. there's going tock a -- to be a big change in washington this fall, and regulations are going to be cut back, tax increases will be off the board. i'm hoping deficit spending will come down. republicans aren't -- neil: it never does though. never does. >> i know. but they're going to have to make a run are. you've got people like pence and gingrich and rick scott all talking about balanced budget ideas. these are good things so that the -- neil: rick scott's talking about more people getting taxed because so many don't pay anyfederal income tax. >> yeah, i think he'd probably like to have that one back. neil: he's pushing it. >> by the way, it's kind of not right because all these people

pay social security taxes. i'm a fan of his, he was just on the show last night -- neil: i saw that. >> but i think the added, i think the policy attitude may be more pro-growth, okay? and growth helps to solve inflation. neil: helped bill clinton, right? >> you know, i was -- i spoke well of bill clinton. neil: yes, you have. >> known for a very long time. neil: you're a fair and a straight shooter. catch him at 4 p.m. on this fine network. more after this, the dow down 181 points. we'll have more. ♪ ♪ . . it smells like actual food. as he's aged, he's still quite energetic and youthful.

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neil: boy that was fascinating listening to larry kudlow here. charles payne, i don't know if you caught it there, he sees the fed really going the other way now, getting super, super aggressive. maybe we're looking at a fed funds rate, i know you follow the fed funds contracts, going up five, six, 7%, wow. charles: tell you what, neil, the federal reserve, finally, finally giving up the ghost. took them a long time. now we're all paying the price for it unfortunately. neil: you're right. charles: thanks a lot. good afternoon, i'm charles payne. this is "making money." breaking now the market to neil's point from lael brainard from super dove to super hawk. can they dismantle the beast without triggering a massive recession? some say they should trigger a massive