take it lightly. >> good day, i'm ari melber potential attack stopped in boston, a city that is all too familiar with home grown terror. this hour the man arrested in connection with an alleged terror plot is in the same courthouse where convicted bomber dzhokhar tsarnaev stood trial. authorities tell nbc news they don't know how wright and rahim planned to carry out this attack all thoel the boston globe reporting they planned to behead a police officer. the globe says that attack was slated for tuesday and that is why members of boston's joint terror task force moved in to question rahim early. he had been around the clock surveillance and he was shot and killed in a parking lot. and police believe he may have been radicalized by isis inspired messages on the internet. the knife is similar to those we've seen isis wield.

his brother claims he was shot three times in the back. that is contrary to the police version of the story that he was shot in the torso and chest. there is security video of the shooting and the d a's office won't release this yet publicly until collecting further eyewitness account. the boston pd did play it for area religious leaders in hopes of correcting what they say is inaccurate information. >> it certainly makes it clear that the gentleman was not shot in the back that he was shot in the front. >> the video is inconclusive. i don't think he was shot in the back by virtue of that. there's no detail enough clear on the video to tell us exactly what happened. however, he was approaching them. they did back up and evidently by evidence of his death, he was fired upon. >> the weapons aren't clearly visible but you can clearly see officers approaching the suspect here with no weapons drawn. >> boston police emphatically

standing by the deadly use of force and loretta lynch also weighed in today, all the way from germany. >> what i can tell you is that wherever we see evidence of a potential terrorist activity we will take the appropriate law enforcement steps. >> even as these investigations and threats continue washington has proven a rare bipartisan ability to rebalance our approach to security and civil liberties with president obama signing the usa freedom act into law last night and administration working to shift the program out of government control. we have more on that this hour but first go to sarah dallof. these investigations are active what can you tell us about these men? >> reporter: well let's start with 26-year-old rahim, ari, shot and killed in this parking lot in front of a cvs store yesterday. he had been under 24-hour surveillance going on for several weeks. law enforcement say his level of

threat had increased. they felt it was in their best interest to try to speak to him, to approach him. yesterday morning when all of that went down. the chair of the house homeland security committee said today rahim had been communicating with and spreading propaganda for isis online. as for david wright, he's scheduled to appear in court in just under a half hour. we'll find out what he will be charged with and his connection to this case and rahim, when that begins. it is set to take place in the sake courthouse where dzhokhar tsarnaev was tried for his role in the marathon bombing case. >> thank you for your reporting. all of this is happening as the nsa has to restart part of some of its controversial data surveillance programs and now have six months under the new law to work with telecom companies to find out how a carrier held data program will work and what does it mean for u.s. intel. we go to patrick tucker tech editor at defense one.

good day to you. >> thanks for having me. >> you bet. one of the interesting parts of this, reasonable people can have disagreements about how to balance this. part of the security debate up to this point suggested we would be somehow completely handicapped and now saying it will work fine moving forward. how will it work and can we get similar levels of security assurances with this extra privacy? >> when the president first issued an indication that he wanted to move the country beyond the collection of bulk telephone metadata, he had the intelligence community come up with a study to look at how they would achieve the same capability but without that controversial program. that study was released in january of this year. and what it says is this pretty much the intelligence community is unanimous in saying that they do use the bulk metadata. they won't tell you how exactly

but it's for their regular work connecting the dots between one person and another, seeing where a person was. and so they have say that even though they use that they can to some degree not fully but to some degree replace that with new capabilities. under the freedom act, it's the telephone companies that contain your metadata and the nsa could ask for aspects of it with a fisa court order. some of the ways that the intelligence community is going to do that and retain the capabilities that they had when all of the date at a was on their servers is potentially to have much smarter software that does some of the job of an analyst, looking through metadata as it exists on company servers then pinging the intelligence community when it finds something that might be of use to them to take that potentially to a fisa court and get that warrant. >> it's very interesting how you lay it out and that will happen over a period of six months. six months from now when this does kick in and the companies

have all control over the bulk data what will it mean to be under surveillance and how will that be different than how it's done in the past? >> well one of the big differences is that now the entire country is not under surveillance in the same way. we can all feel a little better about that. the intelligence community would need to have more probable cause in order to begin to listen in on everyone or on a particular person's exchanges. and more importantly, when we communicate with anybody, that's not something that would be stored with the government. so it changes that. there's a couple of other changes and couple of things that stay the same. the fisa court would have to go to and employ certain instances special advocates for privacy rights in particular cases. we're not going to be sure which cases they are, but you're going to have someone in the room during certain hearings where these fisa court orders -- >> it's not a one sided court

anymore. >> right exactly. that's one thing. one of the things that the intelligent community retains is the ability to do roving wiretaps to watch a target as they move from device to device and also to monitor lone wolf targets and this is a provision that they say they've never used but this case really highlights the potential there for people that aren't formally affiliated with any particular group that don't communicate necessarily with isis that often. and their potential threat level, the intelligence community says we need to watch those. >> i think most folks rg are okay with tarkted targeted investigations based on probable cause. but when we get into fishing expeditions when folks are looking to see what they see, that's what makes a lot of people nervous. you seale a way to get us out of the fishing expedition business? >> this is what is potentially promised by new software tools, we don't know if those

particular software tools will be available in six months it's sort of something that this national academy of sciences report laid out as a solution. but what it does it sort of works the way spotify works, when you turn on to the spotity, you don't own the songs but you get access for a period of time because a bunch of rhythms determine you can play it but don't own it and the software solutions they could begin to develop would look a bit like that. the intelligence community still says the reason we have all of this stuff is because we sometimes don't know who to target yet and having access to all of the telephone metadata records that we can get our hands on allows us to do that targeting. they are pretty clear. they still use that stuff and still want it even though now it's basically prohibited from their use. >> telecom companies and many other companies as well are already collecting our data in a variety of ways.

how secure is the data when it's held by these companies? >> well that's a matter of some mystery. how secure was it when it was held by the nsa? not very you had a third party contractors with a couple of flash drives hauled the family jewels to hong kong and now lives in russia. the thing about data is this when you use it you expose it the more you collect and more of it you use in some way, the more likely all of it is to get out. i think we all have to kind of get used to the idea there's no place where this data is perfectly secure. the military and the national security complex in general actually do have an interest in enabling more secure sharing of data with the understanding that we share our data with lots of devices all the time. where we see vulnerabilities is where in the process of that sharing data goes missing and goes to one place or another and that's what actually opens up a lot of hacking activity that we

see. right now no matter where it's held, our data is not perfectly secure and it's hard to believe that it will be because we want it to be. >> and the snowden example is one that senator leahy mentioned this week that gave him pause about combining it all, what the nsa was doing was more valuable than the individual companies had on their own. coming up later, a guest who says america hasn't really won a war since world war ii and what we need to do is learn how to lose wars better. all of the 2016 candidates seem to be anti-wall street do you think the big banks are the enemy or attacking a convenient scapegoat? right after the break, if it's a day ending in y, that means any day, then a new candidate -- >> thanks for clarifying. >> look at the new bybies in the race in general. that's next on "the cycle". >> so smart. vo: with beyond natural dry pet food, you can trust our labels. when we say real meat is the first ingredient, it is number one.

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the former governor and senator from america's smallest state is hoping to make a big splash on the 2016 scene. tonight rhode island's lincoln chafee declares his run for the white house. chafee has a fascinating political story, wasn't always a democrat. in fact he's never held office as a democrat. i talked to him on sirius xmt m radio how he abandoned the republican party because he felt the republican party abandoned him. >> kind of conservative on fiscal issues but liberal on social issues is the general

cliche about rockefeller republicans. as the party changed as you know room for us became less and less accommodating. >> on the republican side rick perry announces his bid tomorrow. donald trump has a special announcement set for june 16th and louisiana governor bobby jindal is calling his announcement major, wonder what to could be, that's expected three weeks from today. lts to get to with jimmy williams. always good to see, executive editor of blue nation review. good to see you, bud. >> hey, guys. >> another day, another presidential announcement. there's a lot to get to. let's start with lincoln chafee who makes it official today, running as a democrat but as you heard in my interview with him still fiscally conservative but socially out of step with the republican party. there's no place for him there but there's no pathway for him as a democrat either. where does someone like that fit

in today's politics? >> i'm not really sure what chafee's motivation here is it's not like -- for that matter -- here's my thought process on chafee where you're a united states senator and think you can be president of the united states only two of those for the record and once you leave the senate that vacuum and void is there. he's no longer the governor of rhode island. what is he going to do? he's not terribly old so he has a career ahead of him. i'm not sure what it gets him. when i worked in the united states senate he was a republican. he was a liberal republican and by the way he says he's conservative on fiscal issues but voted against the bush tax cuts. i'm not really sure where his conservism is on fiscal issues but he's a thoughtful guy. if trying to get into the democratic nomination platform if you will he's going to have to explain his positions from the path in his vote and that

could be very tricky for him. >> i think on entitlements he's been more of a fiscally conservative side of the equation, of course republican parties move far right in terms of fiscal conservatism as well. let's talk about another long shot candidate, carly fiorina, i got to talk on my web show earlier today with two republican congresswoman really genuinely excited by fiorina fiorina, mimi walters. let's listen to what she had to say. >> it's a big challenge to run and big commitment for your family if you take on running for president of the united states. i say you go carly. i think that's awesome. >> i thought it was interesting, carly the only woman out of the like 400 or so republican contenders that have decided to throw their hat into the ring and it made me think talking to

these women generally enthusiastic, there might be something there, not that she's going to win but you can see republican women in iowa and other places looking at carly and being excited by what they see. >> women are not monolivic but they like women to run for office. what we do know is is women determine the outcomes of every single election if they show up or don't show up and vote. as for fiorina, she is a long shot. and republicans have a problem and that is if you have 35 republican men who are sitting on stage and baseic basically beating the heck out of hillary clinton over and over again, that optic is very bad. now whether she makes it into those debates or not, i don't know. she's got to get her name i.d. up. if i have a women attacking a women, that's a far better political optic than republican men doing that to hillary clinton. i will say this women, wives,

it's one thing for the men and republican men in the country to go i don't like hillary clinton. if have a bunch of men saying that on stage their rifz will raise an eyebrow, stop bashing women, that's not correct. she's credible and qualified to be president. judge her on that. that is a problem for them. >> some folks in this country may feel that she is qualified to be president by their own metrics but i think we can degree, she's not going to get the nomination neither is lincoln chafee most of the folks, 95% of the folks in the race have no chance to get the nomination -- look abby no chance to get the nomination. but some of these folks don't know they have no chance. they may have convinced themselves they have a changs. some of them surely do know they don't have a chance. why do all of the long shot candidates, you've known some do all of the long shot candidates know they don't have

a chance? if they know that why do they run? >> some of it is humorous and trying to position themselves for what happens in 2017 when there's a new administration. some want cabinet secretary positions, linds si graham is running for president. he certainly would in a republican administration make one hell of a defense secretary. i've not spoken with him but i think that plays into it. i think that's part of it. they like cabinet jobs and want to get out of the senate where not much gets done. if they run a department or agency that's a good thing and not a bad way to cap stone your public service career. that's part of it i think. >> don't you think for some candidates there's a desire to shape the debate. i don't agree with tour'e i don't think there's any way to project this far out exactly who is going to be in or out of viability and there are examples throughout history no one expected lbj as an incumbent

president to not run again. that was a direct result of mccarthy which brought rfk in. there's so many things unpredictable in politics because it is up to voters even if money matters more than before. don't you think there are people who maybe are long shots but want to get in or shape it rand paul, pushing the party and making i think immediate impact on surveillance and security? >> the saying is the last man standing wins right, if you're the last two or three standing on stage, that gives you some viability but we're a long way off from that. you're right, we do not know what's going to happen. think about in 2007 we all knew hillary clinton was going to run for president and we thought she woob the nominee. then some freshman senator named barack obama ran against her and won and sits in the white house today. so there are lots of things that happened and we don't know until we know. >> we always like to say, the way it is today is the way it's going to be on election day but things change all the time in

politics. that makes it so fun. thanks so much for being with us. >> thanks, you guys take care. >> up next what should a president do when he realizes that a war is unwinnable? our next guest has advice and it's timely advice. "the cycle" will be right back. out of 42 vehicles based on 6 different criteria, why did a panel of 11 automotive experts name the volkswagen golf motor trend's 2015 car of the year? we'll give you four good reasons. the volkswagen golf. starting at $19,295, there's an award-winning golf for everyone. when a moment spontaneously turns romantic why pause to take a pill? and why stop what you're doing to find a bathroom? cialis for daily use, is the only daily tablet approved to treat erectile dysfunction

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in the war against isis there are new numbers announced by u.s. officials. they claim 10,000 militants have been killed by air strikes in the last nine months. the u.s. has flown 15,000 flight missions over syria and iraq resulting in 4,000 air strikes, the cost $2.5 billion. despite all of this, isis continues to advance. critics claim that we're losing and while that is debatable, recent history suggests that it should actually come as no surprise if we are losing. provocative new book titled the

right way to lose a war, ins world war ii the us has stopped winning and here with us is the author and an expert is appearing in the atlantic and it is a fascinating read. i definitely recommend it to people. >> it's a pleasure to be here. >> you call attention to this statistic, which is troubling, it took 21 days to capture baghdad in 2003 and 3,174 days to leave. it seems like there's something essential in that statistic with regards to why we have so much trouble winning wars. >> right, why is america stopped winning wars. up until 1945 the u.s. won almost all of the wars it fought. since then we've seen a couple of string of stalemates and defeats in places like korea and vietnam and afghanistan. once we get into these quagmires

the u.s. finds it difficult to get out. >> you talk about the golden age and speak of one of the u.s. generals speaking the day before d day, americans play to win all the time, that's why americans never lost or -- i read that and think that's one of the things so many people love about this country, our confidence. but at the same time does that all get us in trouble intervening in places at times so we can't win? >> that's absolutely right. one of the great things about america, this positive spirit can do mentality. america is one of the most successful countries the world has ever seen. but in war, the recent record has been very tough for the united states. despite all of america's power after world war ii the u.s. has barely won a war.

it's been one failure after another. the reason is when we go to war, we're very confident, think about bush saying we're going to turn iraq into a beacon of freedom in 2003 then most wars have not turned out as we intended. >> you talk about how to deal with losing situations and other quote, resolving a failing war is perhaps the greatest of all political challenges leaders must make critical decisions at a time of stress and incomplete information, must be weary of the biases to skew their thinking to the very real voices from the military pressing for an expansion of objectives. they must accept loss rather than deny it it's part of the problem. what the political leadership needs is almost at odds sometimes with what the military leadership wants. >> ending a failing campaign getting out of a quagmire must be the most difficult challenge in all of politics. your entire career is at stake.

think of lbj stuck in vietnam trying to get out or bush in iraq and afghanistan struggling to find an exit strategy. this is the most difficult problem. in fact for the last two centuries, no american president has ever managed to ends his own failing war. they've all handed it over to the next guy. >> interesting. >> that's all from our perspective of the u.s. as the most powerful current nation state in the world stage. you write conventional interstate wars are now rare. what do you mean? >> so there are two main kinds of war. you've got conventional interstate, where we fight a foreign country, our army fights their army on battlefield, think world war ii those kind of wars are very rare. the rest of the civil wars like insurgentcy insurgency -- >> isis a product of two civil

war snz. >> pretty much. >> the classic exam. two civil wars syria and iraq and isis moves between the two. the u.s. has struggled to adapt to this new era of insurgencies and civil wars. >> it's a provocative book and also an important book. thank you so much for being with us, we appreciate it. >> my pleasure. >> also in the news cycle, new detail this afternoon from pentagon officials from live anthrax samples that were accidentally shipped out to dozens of locations both here and abroad in a joint briefing of the defense department and cdc last hour they paid it to 51 facilities in 17 states and three foreign countries. the cdc stresses they don't blech the live spores pose any danger.

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terror killed tuesday in boston and alleged partner due in court right now. david wright and rahim discussed randomly executing or killing police officers this week. sarah dallof is keeping up with the story. >> reporter: they are very chilling and reference phone calls and text messages that the fbi was able to listen into and read. it begins in late may while when rahim purchases three knives online, the fbi says they intercepted those packages and x-rayed them to be sure those weapons were inside then allowed them to be delivered. they followed the next few weeks, text messages and phone calls referencing the affidavit between wright and rahim, in which they discuss this plan to behead someone in another state. a few days later rahim comes back and says he has changed his mind. no longer planning that attack in another state but instead intends to go after quote, the

boys in blue. that attack was reportedly planned for either yesterday or today. wright advised rahim to wipe his cell phone and laptop clean of any damaging information and be sure to destroy both. they also reference this third person. they say that rahim traveled to another state to meet with this third person outside on a beach in inclement weather to discuss the plan. this third person is not named and we don't know who that is at this point. wright told investigators that he agreed with rahim's plan and supported it. he said the two would talk in code. they believed when they said they were going to go on vacation, that they were actually saying they were planning to carry out this attack and reference a time are where rahim said something was thinking with your head on a chest, a reference to beheading,

very chilling details right now. the arraignment for david wright now getting under way in boston. that is the same courthouse where dzhokhar tsarnaev was tried for his role in the marathon bombing. getting that new information on this latest case very chilling details about an alleged plot to randomly kill law enforcements. >> what they are saying on the vacation reference and et cetera, these folks were being recorded speaking in code but authorities believe they cracked those codes regarding an attempt what they are calling jihad. we'll have more as it develops. a bit of a market alert, stocks up across the board, just shy of record levels. main street lags far behind. look at this current wage gains stuck at 2% barely keeping up with inflation and that shaping up as a big campaign issue and not just on liberals focusing on

income inequality. >> there are ways we have to recast our thinking. so much about the rise in productivity without the rise in wages has to do with decisions that businesses are making. >> we're facing right now a divided america when it comes to the economy. it is true that the top 1% are doing great under barack obama. today the top 1% earn a higher share of our national income than any year since 1928. >> recently the ceo of goldman sachs let his employees know that he'd be just fine with either bush or clinton. i bet he would. >> bigger policies to deal with this issue of the lack of people moving up and the fact that people in the middle are disaffected and don't see the system working for them is what we need to fix. you can do that by tax reform entitlement reform and regulatory reform. >> you hear them talking about it and wall street often makes a

good target. many executives involved in the financial meltdown faced zero consequences but some reformers are arguing attacking wall street is cheap when many of today's questionable tactics like moving capital offshore to avoid taxes or selling complex and risky products are perfectly legal. in those cases is it up to congress to ban bad practices rather than blame businesses for pursuing our legal options for making money. we'll take it right here to richard farley an attorney who represented some of the biggest banks and author of wall street wars of history of the modern financial system. thanks for being here. >> thank you for having me. >> let's start right there with that debate. isn't it positive for political leaders to put some pressure on companies even for prudential business decisions, for things they can legally do but like to see them do them better for most americans? >> i think obviously so you'lling that who makes the decision as to what's good for the average american.

now, there are those who will argue the marketplace generally except on the end lines where the bad behavior is and should be outlawed out to be decided by consumer and business investors in the free market. others will say we need a more central planned aspect and more government involvement. this is a debate that transcends the presidential politics appealing to the primary voters on the democratic side and on the republican side which are on the extremes of both parties. you know what the statistics are in terms of who's voting in the presidential primaries, highly motivated and tends to be on the extremes and wall street is an easy target for both because there's resentment on the right because the banks were bailed out and that was sort of af cognitive dissident. they want to attack wall street for unveiling the fact -- >> let's be real no matter where you are on the political spectrum it makes for pretty

good politics to bash wall street. >> absolutely. >> anywhere on the political spectrum -- >> i agree. >> when you look at the news items, not only the financial crash but look at the scandal, it seems there's pretty good reasons to look at wall street and say this is an industry ripe with corruption. the guy alleged to be the ring leader of this libor scandal, his defense is that everybody was doing it why pick on him? >> putting aside what anyone's defense may be if you look at any industry look at the news media, if you look at cab drivers, there are bad apples in every industry. you don't necessarily taint the entire industry because -- >> but we're talking about five banks just paid more than $5 billion and pled guilty to the massive scheme involving traders at 16 different banks. >> i don't agree with a lot with the judge rackoff but i agree with this notion with penalizing the stockholders of institutions

for the bad behavior of a few bad apples is bad policy. >> you're talking about the new york judge very tough on the way these guys have gotten away -- >> what he's been tough on is the strategy of the government that says the way to approach and deter bad behavior is by having the shareholders your pension fund and your 401(k) and mine, takes the hit rather than the individual who is on that trading desk if they committed a crime, that individual should suffer the consequence. that's a deterrence not that your 401(k) and mine are worth less than they were previously. >> some bankers would say politically there's too much focus on our industry compared to others. does wall street get special treatment? that totally far fetched? >> no because for the obvious political reasons, it's an easy target particularly in the season we're entering into, which is the presidential primary season. where the voters who decide who the nominees are much more to the left than your average

american and as a conspiracy of extremism, the piece i wrote in the daily beast lays this out in terms of trying to restrict the power of the federal reserve to prevent the next bailout. we see the potential adverse consequences of this sort of policy by extremes uniting around sort of odd bedfellows. >> here in primary season wall street is a big punching bag for folks on both side and yet wall street and financial industry remain the biggest donor to people running for federal office, right? leading industry giving money to candidates. >> i'll take your word for it. >> that is true. does wall street care when the candidates are beating them up? >> of course, yeah. i mean, it has an effect on your business and when you go to a cocktail party. nobody says that's the banker and why we had all the terrible stuff -- >> frequently the rhetoric bashes wall street even as policy supports them. >> i will think we'll be hard

pressed to find a policy since 2008 that has really supported wall street. i think it's been and we can argue how much is appropriate and how much is not. >> citigroup was outed for writing some of the amendments to water down dodd frank on executive compensation. >> tweaking the law from your perspective as as american as apple pie. >> one man's tweak -- >> or twerk. >> up next, an nobel prize winner will tell us how to understand economics with a special lesson for tour'e. get your popcorn. should be fun.

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- available at these retailers. there are currently 100,000 people in this country on the waiting list for a kidney, only 10,000 become available each year. how we allocate this scarce and important resource is a critical question. the man who revolutionized the kidney exchange is a global leader in markets where both sides must choose the other. he says the same rules apply whether life saving medicines and college admissions or finding a mate. he's also the winner of the 2012 nobel prize in economics and author of "who gets what and why" and most impressive he's on "the cycle" right now. please give a warm welcome to alvin roth. please explain.

what are matching markets and how does that deal with the kidney exchange you revolutionized? >> matching markets, you can't just choose what you want even if you afford it you have to be chosen. kidneys are rather special extreme kind of matching market because we don't allow kidneys to be bought and sold for transplantation. the law of the united states and of most countries, the price of a kidney must be zero. there aren't enough 100,000 people are waiting for them. a lot of kidneys come from living donors. you have two kidneys and if you're as healthy as i hope you are, you can give a kidney to someone you love and save a life. sometimes you're healthy enough to give it and can't give it because it didn't match their physiology. sometimes don't donors are incompatible. and when you have multiple incompatible donor pairs, they can exchange kidneys so everyone gets a kidney good for them and

that's a way of bringing a benefit of a market to kidneys, without breaking the law, which says you can't use money. >> so interesting, this is obviously a political show and we hear from politicians who talk about the free market and capitalism. you talk about how this is about misunderstood, right? all markets have certain rules that help establish them and regular regulate. what are some things that can go wrong in markets and what are the best sort of ground rules for setting up efficient markets? >> to work well they have to make the market think and bring enough to the marketplace to transact with one another. once the market is thick, there's sometimes congestion so many things to look at. it's hard to look at them in time and do things quickly. they have to deal with congestion. and then markets have to be safe to deal with. they have to be trust worthy and reliable so you don't mind giving them your credit card number and giving them your

information. so that people are willing to come to the marketplace and transact there. >> you focus on the market of love and what so many men are getting wrong about attracting a woman in their life. and you talk about online dating and how if a woman doesn't respond, their initial reaction is just to write another e-mail and another e-mail which you define as cheap talk compared to just reading their profile, what you call zoning into something to pop a signal to the woman that might make them more interested. speak to that. >> well in a congested market where there are lots of potential matches, you have to send two kinds of signals. you have to send a signal that says you should be interested in me, look at my accomplishments and talents. but you also have to send a signal that says i'm interested in you. this isn't just one of a million e-mails that i've sent out today. i actually looked at your profile and thought that maybe we'd be an interesting match. so we see this in college

admissions as well. now that it's pretty easy to apply to lots of different colleges, the fact that you've applied to some college isn't necessarily a strong signal of your interest, as it might have been when you had to hand-write an essay specifically for that college. so colleges look for signals and men and women look for signals that not only are you interesting, but you're interested. >> it's not always about yourself. look at that. >> it sometimes takes a nobel laureate to remind you of that. on that point, signals of interest versus signal of desirability. how does that work for a participant in the market? you write here about the dating example and the application example which you just briefly mentioned and you basically say a peacock's tail or a big bank building, those don't indicate interest, they create desirability. how can a participant try to master both of these signals? >> well so let's think about college admissions.

if you're a high school senior who's going to visit some campuses, he should be sure to sign the guest book in the admissions office so they'll know he took the trouble of coming to visit. that already distinguishes him from people who might have been applying to 11 colleges and decided to make it an even dozen and just added an application to this one. so colleges have to think about that because they have limited capacity and they want to fill their classes and dormitories but not overfill them. so they care when they start to recruit someone whether that effort will be rewarded. they care not just how desirable you are, but how interested you are in them. so sending costly signals like visiting the campus helps. >> a signal that takes more means more. >> yes. >> professor, the book is fascinating. best of luck with it. i hope you come back and visit with us again. thank you so much for your time. still ahead, ari explains why almost every presidential candidate is like alicia keys, they keep on falling in love.

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in the past few week we have seen several new names added to the presidential campaign. martin bernie lindsay, rick carly, ben. that's just to name a few. reporters have rushed to start handicapping their chances, testing how they fare in the polls and then telling us who's a frontrunner or who's first tier and who doesn't have a shot. a lot of that punditry is wrong because it fails to factor how few of these candidates know voters at all. most candidates have an alicia keys problem. you may remember her hit song from 2003 which shows alicia as

a waitress with a crush on a young man who frequents her diner. there's just one problem. he doesn't even know her name. ♪ you don't know my name i swear ♪ ♪ you don't know my name ♪ >> alicia depicts a soulful woman who just wants her crush to learn her name. but in most early campaigns, most candidates are alicia. and the voters are that guy. and you can't like someone before you even know they exist. that's why most national polls are actually useless at this point in the race. they don't show who's popular or who's likely to win they often show who's simply the most well-known. at this time in 2007 obama had half the support of clinton in national polls but, of course he went on to win the nomination when he was better known. and do you remember who led the gop polls in june 2007?

rudy giuliani was first in poll after poll that month because he was already nationally famous. alicia knew his name. so to speak. but that name didn't translate into votes once other candidates got well-known. rudy didn't win a single state. he didn't even win a single delegate. his national name left him in the dust behind people like mike huckabee and ron paul. so we know that history is not the key to winning and distorts any significance of these early polls that so many insiders are treating as gospel. the challengers still have to work to get their name out. comedian cecily strong wasn't even really kidding when she described that challenge for governor martin o'malley. it's his main issue as he runs against hillary clinton right now. >> let's not forget martin o'malley. i don't have anything to add. that's just his campaign slogan. >> while the clintons and bushes of the race can hang back and ride on their names, at least for a while, most of the field has to do the hard work on the ground of introducing

themselves. there's an extra wrinkle right now for republicans. they are using these flawed national polls to actually determine who gets into their debates. i think that's a vicious cycle where the less well-known candidates are basically punished for being less well-known with exclusion from the very conversation that might let them get the voters to get to know them and their ideas. and that, my friends, brings us back to alicia. to breakthrough to her crush, she ultimately took his business card out of a bowl in the diner and introduced herself as the waitress from the coffee house on 39th and lennox. and that took courage. way to go, alicia. but that kind of introduction is getting harder in a season dominated by big money and big media and these debate rules. both parties should ensure their rules allow all legitimate candidates in the debates, not just the famous ones and we should keep this dynamic in mind. whenever elites try to tell us who the frontrunners are before a single vote has been cast. all right, that does it for the song and "the cycle."

"now with alex wagner" starts right now. chilling new details about the boston terror suspect killed yesterday who authorities say was planning an imminent attack on police officers. the fbi has low-flying planes that can surveil americans through their cell phones and rick santorum is telling the pope to put a lid on it. but first the scooby doo van hits some speed bumps. it's wednesday, june 3, and this is "now." >> these stories seem to be having an effect on hillary clinton nationally. two new polls show hillary clinton's favorability numbers are lower than they've been in years. >> is there some real long-term concern? >> a lot of candidates run for office. a lot of candidates though don't lose 20 percentage points in two months on whether you're honest and trustworthy. >> this shows really the lingering