now more than ever it is all about the president. he dominates and is launching a flurry of new policy moves. he has talked about phase 2 of tax cuts. kevin brady told us he is working on it. here comes another tax deal. larry kudlow is moving in as the administration takes on china on trade. the trump team wants our products to sell in china the same way there products so

here. kudlow is on board with that. this is the reorganization of the most important trading relationship in the world bar none. the president is talking about putting an immigration deal into the long-term spending bill. that puts democrats on the spot. will they build the wall and the dreamers have a path to citizenship, and the top level of the trump team, the president is solidifying his administration around his worldview. direct from the white house the trump show. in a moment how this is all playing out in the world of money. the president has grabbed all the attention. "varney and company" is about to begin. where are we going to open up. 60 points higher, the way we

start is not necessarily the way we will finish. stuart: don't take much into account. and got the message going. toys "r quote us closing all of its stores, it is gone. mattel and hasbro stocks have gone down sharply when the news first broke. now that it is official, not much further selling in those stocks. boeing in the news yesterday, took a huge hit in trade war concerns, backup $1.94. i have a question for you. larry kudlow appointed new top guy economically. liz: could he avert a trade war, feel like jumping into a pool of live hairdryers.

what is going on in the white house and china? he is a good communicator, stabilizing presence, commanding presence. and it is a language, let's tone it down. it is not a trade war, it is resetting it. stuart: kudlow is on board with a tough stance against china. straightforward politics. donald trump floats the idea of extending dreamer protection with overall big term spending plan. if this goes through, the deal is in the long-term spending billed immigrants are on the spot. >> they have been on the spot before. democrats are more interested

in playing political games than trying to come up with a solution for the kids they want to come to a solution for but they want to see the president failed. >> if it is in the bill, in writing, build the wall, get money for the wall. whatever the number is. if democrats reject that, government spending for the next couple years on behalf of illegals. >> democrats in this position before. they would oppose comments or solution even if it does political direction even if it hurts the people, they are the party of the resistance, that is what they bank their future

on. and willing to risk a showdown. stuart: i think you are wrong. after the election in pennsylvania tuesday they are moving away from nancy pelosi because connor lamb won, we think he won putting distance between himself and nancy pelosi. a lot of democrats paying attention to that now. >> remains to be seen whether they apply the same principle across the country. if democrats run is pro-trump democrats for these trade tariffs and oppose nancy pelosi the democratic party is more compelling than i thought it was. nancy pelosi controls the power of the purse. money, talks. i don't believe you're going to

see this rank and file retreat from nancy pelosi unless we see a few more of these cases develop. as long as she controls the purse strings it will be difficult. stuart: you are not totally wrong. brick and mortar icon, toys "r quote us going away completely after 60 years in business. a retail analyst with the strategic resource group. they are going away completely. it was walmart that knocked them on the head, then amazon and now loaded with debt. >> wall street that against them which the complicity of other news organizations. and congress is going to

investigate that, after going after the russians 1000 jobs are to be lost. >> we met with - and kimberly-clark. and $780 million, and only had to refinance $100 million in debt and wall street vultures and complicit news organizations catalyze putting them out of business, people wear jumpsuits and federal facilities and congress instead of pocket lining and dining with lobbyists get affirmative justice after these criminals that murdered jeffrey the giraffe, put toys "r quote us out of business and 100 other jobs in shopping malls that are coinsured. stuart: i didn't know you were going to say that.

can you point to any winners? >> kids are crying across america but if you want -- stuart: walmart, amazon. >> walmart plus is up, cvs, rite aid, this is the death of all toy retailers worldwide, schwartz, toys.com. there is no place left for the experience of buying toys, everybody from movie theaters to licensed toy manufacturers, everybody loses. stuart: you made your point, thank you for joining us. there are signals slowing down. the first forecast growth from

the federal reserve dropped all the way down, brian brent berg is here, where are you? the kings college. is this economy slowing down? >> atlanta said estimates are way off early in the year. that number was way off. stuart: why did they cut it so much? >> data comes out through the quarter and retail spending and industrial output and make adjustments, the first peak of the final number, let's hold off a little bit but what this number says is you cannot abandon the growth agenda. we have a eight year old on growth, the president can't slow down, they need policies that keep pushing growth. stuart: you must like the phase 2 of tax cuts, you must like that. >> smart economically and smart clinically. everyone knew these would

become permanent, and why not make them permanent right now and get political credit for it, it was democrats, for not making them permanent. >> retirement savings focus tax cuts to boost retirement savings, more tax improvements there. stuart: we could all get behind that. much more on the president's policy moves coming, and democrats on the spot and when they do a deal. the chief economic advisor, we have a guy who recommended him for the position. our friend are laugher is with us. the sec charging the founder with elaborate and years long fraud. she agreed to have a million-dollar penalty and giving back all her remaining shares. the judge will pass judgment later this hour.

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stuart: another rotten quarter reported by sears. sales fell by nearly a third. still not as bad as wall street thought it would be so stock is up 5%. we should cue the organ music anyway. the economy, a tweet from donald trump this morning. larry kudlow will be director of the national economic council. our country will have many years of great economic and financial success with low taxes, imperiled immigration, fair trade and ever-expanding labor force leading the way. former reagan advisor art laugher is with us. you had a phone call or two to recommend larry kudlow. >> yes i did. >> guilty as charged. he goes back to the reagan

administration. grow the economy and prosperity that is the guy he is. >> he is phenomenal, i couldn't have recommended a better person ever. larry is perfect for it. he has a public persona which is very important. he has a well-trained economist, he really knows his stuff and he has had experience for 40 years in business and public life that has been phenomenal. i can't imagine anyone better than larry for this job and the president needs someone like him. he is really excited to have this position. it is a perfect marriage. stuart: did my name come up? >> it did. it was an epithet. stuart: the issue that is very serious and on the table is tariffs. he doesn't like tariffs but

appears the president persuaded him that tariffs are a negotiating position and larry kudlow bought it. >> don't know if the president did that with larry and bought it but i believe the president was using tariffs as a negotiating position and they work. he has done it before he was elected. i can't believe any man who runs a big business like donald trump has, it was important, don't see how anyone like that could not be in favor of free trade. he's a phenomenal person who understands international business and negotiation. how do you bring mexico and canada to the table to renegotiate this awful treaty. stuart: i think the big deal here is china. it seems to me we are right at the beginning of a new renegotiation of the trade relationship with china. >> we need to have free-trade,

fair trade agreements where everything is on the table and up for negotiation. you don't exclude nontariff barriers like the japanese did with currency manipulation, they moved all the real protections off the table and off negotiation and discussed minor little footnotes. that is not the way a free-trade agreement is done. he is going after the real deal and at the end of this term he will be the biggest free trader of all. stuart: china has been stealing our intellectual property for many years. that is an issue. bill gates will be at the white house for private meeting with donald trump. i wonder if intellectual property is going to come up. >> i hope so. donald trump is into this stuff and should be and it is important for the country in

the world not to have people stealing products from your. stuart: he didn't mention the. i am bitterly disappointed. >> we did talk about you a lot. i thought i would mention that. i am not going to say what. stuart: you are all right, see you again soon. lift going to develop hardware and software for self driving vehicles. ashley: a long list of partners in this, color motors, jaguar, land rover and more, just signed up with an auto parts supplier. what they want to do is to build a kit that can be installed in existing cars and give itself self driving technology. they have their own division in silicon valley to achieve this. they are partnering with a lot

of people. uber is doing it by itself whereas lift has a lot of different companies working towards this goal. stuart: here they come, self driving cars, self driving taxis, not yet but soon. that is what we keep saying. liz: it has a lot of partners because the problem we talked about, apple cannot do its typical closed buffer system. you have to have cars talking to each other so apple is not going to fly. stuart: ali baba are working on a plan to lift shares in china, stock surging on that news. this is premarket, they are up 4%. united airlines trying to kid past bad headlines after a flight attendant put the french bulldog in an overhead bin before accidentally sending another family pet to the wrong country. more bad pit news and we are on

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family members. if you are allowed to bring them on an airplane, you shouldn't have to do it in a way that your pet dies. it is just not right. it is just wrong. stuart: louisiana sen. john kennedy upset after that puppy died on united airlines flight. the airline is announcing a new cabin animal policy. ashley: brightly colored tags to the carrier so flight attendants can make no mistake that there is an animal in their. they take full responsibility for this, she didn't realize, the mother and daughter who suffered this horrible event said that is not true, she said you have to put him in the overhead bin and other passengers -- she knew there was a dog in their. stuart: a pr nightmare.

there is another one. the carrier, united, mistakenly shipped to kansas family's dog not to kansas but went where? >> japan. the swindle family moving from oregon to kansas. they didn't find out until 2:30 in the morning that their german shepherd was mistakenly shipped to japan. he was on that flight with no food or water for 16 hours suffering from any or infection as well. he is now safe, going to send them back on a charter plane, they burst into tears that this dog ended up in japan. stuart: it will make no difference to the financial performance of united. >> we have gotten used to bad performance by airlines. i don't care what you do, that is how airlines made a living. stuart: it is not a cheap flight. >> if you can do those things

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>> all right it's about 15 second to go we'll open this market this thursday morning.

indicate a higher opening up 80 maybe 09 points remember yesterday we were way down 240 odd points down yesterday in three seconds we open up this morning. let's see how the action goes throughout the day. we're off, we're run aring and up 70, 87, 92 points in the first few seconds business. we have opened strong and i see a lot of green on the left-hand side which means, a preponderance of the dow 30 close to upside and close to 10 in early going. 105 to be precise that's a gain of 4.4% lesser gain on the s&p. up about a quarter of one percent. how about then technology stock. the nasdaq composite just a fraction higher. so the going in the early going, the action is in those dow 30 stocks. who is with me? ashley webster, elizabeth mcdonald brian, and yes john leifield fresh from the beach in bermuda. now john, this is, has been a

long-term dip. have you bought it and are you still buying it? >> i have bought some stocks i bought botz with trade in artificial intelligence because tech is points out that almost every time there's been a few stocks that have been driven majority of this market i think tech will continue to be that leader. i'm more worried about few things long-term a trade war and inflation going on and market is trading right now on -- fund mental economic, hi, and i think that's good. >> might also like the sound of a phase two of tax cuts as well. i think that's probably a good teal. okay look at boeing, it can a huge hit yesterday. investors worried that there will be a trade friction between the u.s. and china. we impose tariffs on them and they would impose maybe some it was a on bothing way down yesterday. not up that much this morning. 330 bucks per share. all right brian, now the president says these tariffs

that he's talking about they're just an opening gamut just an negotiating point therefore no trade war what had say you? >> better trade deal he doesn't want tariff and ultimately that's what he's going for remember he's the jobs president he'll always make the move to help jobs and if that's avoiding trade war he'll do that. >> larry kudlow is coming onboard strong against china. >> fears that market has about a trade wear had doesn't want a trade war he'll come or for the president. >> here's another concern for all investors, interest rates. as of right now the yield on the tenure treasury is 8.2% historically that's really low. we do have this famous fund manager his name is jeffrey he says that yield hits 3%, the bull market is over. john leifield i'm inclined to say that this stock market could handle a 3% yield on the tenure treasury what say you? >> i think you're correct. i think what jeffrey is talking about is specifically is the de

facto bond trade and yields have been so low, the de facto trade have been for diffed tend not get a yield anywhere else. that trade could be killed you have a 3% plus yield coming out of the bond market so yes that trade could be over. but now this market is trading on the trump economy and i think that trump economy right now is doing quite well especially if question get that second round of tax cuts you mentioned. >> let's summarize with three minuting in dow is at 24,800 that is about 15, 6000 points off the all time high. interest rates steady to slightly lower this morning. and worry about a trade war not exactly in retreat but carving those fears shall question with say. individual stocks making news. 3d precincter make earn 3d system driven by strong demanding for product used in health care and manufacturing stock sup a whopping 10%. 3d system. barnes & noble strong forecast, improve sales, lower costs up

she goes. 5% that's barnes & noble brick-and-mortar book sales. rose forecast buying bare shares up it goes 3%. dollar general, better sales up it goes, 6.5%. blue apron, okay. after report they're up after report that the company is going to sell meal kits in stores. not just delivered to your house but instores. up 3%. nearly 8 years after congress clamped down on banks because of the financial crisis senate voted to ease some rules on small and mid-size banks. now the financials are largely up on this. john come back in again please. these changes for the it shall regional and community banks are they going to make it easier for me to get a mortgage? >> they will. because one thing that came out of dodd-frank was they pulled up to credit and 1% pulled because doted frank and specifically hurt where the regional banks

who have nothing to do with credit crisis whatsoever and then you put guys in charge who missed it in charge of fixing the problem that they couldn't see to begin with. all they did did was cripple wang, lekdzing and the economy and they did nothing to fix what was essentially wrong what was the derivative market. >> a lot of people arpgd this table have been driven crazy trying to get a mortgage with -- jumping through hoops. you think it is going to be over? >> senate bill makes it is a lot easier for small banks banks wih assets under 10 billion to write more. >> big deal. regional banks. you know this should be a lesson learned. it just -- there's no shortageful legislation coming out of just backbone. look at wells fargo bringing them up on a 1889 law and enforce law is on the books from the s&l crisis so you know

that's a universe of the regulatory state that's having cutback. >> okay i want to read a brief news item that's coming out but this is from the washington post, the u.s. france, and germany will join britain in saying russia is likely responsible for use of nerve agent against a form or spy so -- >> use since world war or ii a actual nerve agent this one was very, very. we have more on that very shortly in the very act. looked a big tech name making the running what are they doing today mostly down. apple is the soul winner and it is only up 4 cents amazon microsoft alphabet on the downside. hew research says about a quarter of tuts adults they say they're almost constantly online i don't see anything wrong with that. but -- >> look it's good if you're a tech company yiewpt eyeballs on your screen but not good culturally with 40% of americans

say they're constantly you're on your phone right now stuart. so you can't even get away from it. [laughter] but -- >> i don't -- i don't to get away from it. [laughter] i was reading the breaking news, it came to me on this thing what had am i supposed to do, huck it away? please. come on. >> says put that down. i don't think there's anything wrong with being in a constant loop. i enjoy it i have a large family spread around the world i'm in touch with them in a way i could never be without this thing. >> 19 to 20-year-olds are not in touch with their family but looking at social media profile walking from it feeling worse about themselves. fnlings were you ever 19 years old or always -9d96 i want to hear from you. there's nothing wrong with living large on line and you say what? >> i love being in the loop i love having constant information flowing i don't to tack to that millennial anyway i would rather have unsedated root canal to talk -- >> that's wrong.

responding to what i just said. online okay moving on. flf we have or more headaches for tesla. and says company is churning out a high volume of floored parts requiring costly rework and another finance executive has left the company. that's in less than a week. john, what do you say about that tesla had now? >> this really alarms me i'm biggest fan of elon musk from a space race through losing and launch more last year than europe and imbibed as far as spacex but this worries me specifically they have not gotten their production correct if they have deposits come back tesla could be in serious trouble of existing going forward and i hate that because elon musk is great things for this country. >> yet stock is always above 300 a share. rarely dips below it. rarely, rarely -- then we have bitcoin well continues its slide. earlier this week, google announced that it would join facebook in banning krip to currency ads and right now we've

got bitcoin down of 8,200. do you tell your students to avoid bitcoin? >> yotd but they don't listen because they love it they're completely curious about this thing and it's their interest that will carry this thing to probably be market -- bible in the marketplace. >> so saying you break below its february low of 5,922. so -- >> look to me it is gambling and you're not going to use bitcoin as a means of egg change and medium of exchange i don't e see it being a currency sigh it it as a gambling chip. >> some formal of it will be a currency at spoint the question is when and right now bitcoin is not that. but younger generations love it. same one on their phone all of the time love it. they love the gappabling. >> they're in love with gambling bitcoin not in favor of that. it's that tame ladies and gentlemen we have to say good-bye to brian and to you john. thanks very much indeed gentleman fine performance this thursday morning. where are we? we're up, 33 points i have to look at my phone to find out

what day it was it. [laughter] thank you. thank you. we're up 33 points. 24,790. russia says -- they will expel u.k. british, diplomats after a britain's prime minister theresa may gave 23 russian diplomats the boot. earlier this week, nye yell form orer leader with us in our 11:00 hour on that this morning. first, though, the house failing to pass the right to try bill. giving terminally ill patients the option to try experimental drugs not approved bit fda. you can't do that. says the house of representatives. we're on it. we'll cover it after this.

>> it's a tiny gain but it's a gain nonetheless 7 points higher for the dow 24,765. breaking news from the white

house, america standing with the brits in the russia nerve a little attack. blake berman joins us blake it's not just america with britain there are other considerates too. spell it out. >> add france to the list as with stewart this is a statement that was just released. in the attack involving that five believed to be an attack by russia, and now the u.k., france, and the united states all condemning russia opinion here's part of the statement i quote, the united kingdom brief thoroughly its ally that was highly likely that russia are was responsible for the attack. we share the u.k. assessment that there was no plausible alternative explanation and note that russia failure to address the legitimate request by the u.k. government further underlines its responsibility. stuart, i asked president trump about this very incident tuesday morning when he was leaving the white house for california. and the president said at that point he was speaking to theresa may going to it speak to her in the afternoon, and if there was

evidence against russia are that the united states would condemn, well here we are with thursday morning and now united states has joined u.k. and france in condemning. >> got it at the white house thank you blake become to you shortly. president may add protection for dreamers may add immigration deal to the long-term spending bill. joining us now is louisiana congressman mike johnson. congressman, as i see it, and this is just a suggestion from the president. but it might be in the spending bill you bold the qawl. but you also offer, for example, for what 1.8 million dreamers. now, i think that -- putting that in spendings billion puts democrats on the to spot what say you? >> well it may but we have to be cautious about that. i fore that it might feel way a number of republicans -- or qhor needed on the bill to get it through. look, conservatives in the house in particular very concerned about this. we've been supporting as you know the good bill, the secure and america future act because it covers border security.

it has a solution for the daca recipients it talks about a silent reform ending visa lottery program and things we're so concerned about. that's a good deal and piece of legislation we've been trying to advance that and i think some of this may be getting in the way of it. i will give the credit to president credit for being willing to negotiate on it. he's trying to work and trying to work with democrats but many of them are holding it become as plul issue and i think that's very unfortunate. >> if democrats their hat on support for illegal it is that would have been a losing political issue, right? >> perhaps. i believe that many of them are trying to delay the dreamers -- resolution through the election cycle i think they want to try to use it tbens republicans but the important point here is what you're saying stuart president continues to come to the table it he's being creative he's willing to negotiate. and i think he should deserve the credit for that republicans want to try to help but it's a very delicate issue as you know. >> sir i would like to talk you about this right to try legislation which failed this

right to try bill would have allowed patience and terminal condition would you allowed them to use experimental drugs not proven and not faved bit fda. it failed. can you get back and try to pass it? >> boy, i hope so. that was a real heartbreak for a lot of people who really suffering you know for terminally ill patients sometimes it is last best chance at hope and what we're doing by failing to pass this legislation is allowing big government and bureaucratic delays to get in the way of this treatment option for people who december rattily need it stuart so it was a tremendous disappointment to us and i hope question get back to. >> i'm told it failed because of safety concerns what are safety concerns to someone on their death bed who wants to try anything that meeting get him some relief. i don't get that. >> i don't either certainly defies common sense and importantly the legislation allow for only terminally ill patients so those who fit that category and drugs that have already passed phase one of fda

approval and determined to be nonlife-threatening so it's hard to make an argument that these people should not have access to those medications. we're going it try it again and continue to try because we believe they deserve that right. at the i could of the day it's ab liberty interest. should the big government in any state tell you you can't treat your terminally ill condition. i think that's very sad. >> yes, sir. i know for a fact our viewers are up in arms about this one. congressman mike johnson republican of louisiana thanks for joining us sir. much appreciated. all right where are we now. 21 points higher for the dow industrialings and then there's this. some breaking news this morning. new details emerging about why -- x espn president skimmer left the company. this comes from a bombshell interview basically he says to -- that he reare designed rei are bankruptly in december because he was being extorted by a person he bought cocaine from. >> what? >> he said as soon as this came to light i immediately realize i put muse and family and

professional life at risk and went to bob iger and he said look, yeah. you placed this company in a position and it result i believe you should resign. he said i need to resign and that is what is behind that very -- abrupt departure back in december. >> so now we know. he claims he never used cocaine when he was at work but used it it over a 20 year period but nevertheless that is why he left. >> okay, with got it check the dow 30 look at all 30 of them where are we get a sense was overall market movement here and evenly divided i would say it's about half an half actually. 15 up. 15 down very roughly speaking. the dow is up now ow 17 points. taylor two criminals -- founder she has to pay a half million or dollar fine for fraud. martin screl is lee has to serve seven years in jail for fraud. the judge on that, next.

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and what is all about? >> i know where you want to go why wasn't this a criminal prosecution she made representations to o investors and to kiewrls and one of our consumers was state of arizona for which she did did a massive amount of blood testing. >> so a blood testing device machine which she -- >> which she claimed would perform the same test that normally performed when a vile of blood is removed from your arm but just taking it a drop from your finger. mean she was all over the place saying i hate needling look the other way we're going to take a drop to do same test as everybody sells doing with a vile. and it wasn't, it wasn't working the way she was making the representation and investors lost money and fcc went after her and yesterday she settled the case. the case began when our colleagues in this building on the sixth floor of the wall street journal began a great

investigative piece about the nature and a extent of the misrepresentations this sort of i'm the female steve jobs address the way he did did that she was making. >> now, so she pays a half million dollar fine all her remaining shares in company are going and she can't serve on company board for ten years. but she's free. walk the streets in contrast. shkreli goes to prison for 7 years, he pays a $7 million fine, because he was guilty of securities fraud somewhat similar to -- >> a securities fraud in which the alleged victims of his fraud testified for him in his defense. that they didn't lose any money that they made money. yes he didn't use my money the way he said he was going to. but what do i care? ia 10% return one set i have a 30% return one said i have a 50% return and the court instructed the jury you do not negate fraud

by giving a return to your victim. once you make the material misrepresentation, and the victim relies on that, the fraud is complete. so it was a crime without harm. >> but in your opinion, it shkreli get a nasty sentence because -- he was the guy who raise ared the price of a life saving drug 5,000%? >> i don't know why he got that sentence but he got a sentence far more severe than he did it if you compare these two cases and i'm last person in the world to say the government should indict someone but overindict but the behavior is far more demon strabl and cause more harm than martin shkreli he's going away for seven years. >> but she was not smirk continually after raise the price -- >> i agree with you but none of that has to do with the charges against him. he shouldn't go to jail because he's a jerk. stuart, has the right in america to be a jerk. [laughter] >> i know it well my friend.

[laughter] indeed. all right judge, you're off the hook. thanks very much. see you a little later. by the way the could you picked up a little steam now we're up 50 points 248 is precisely where we are. all right. following it all day. i have no idea how we'll close, of course, i have to -- that's a little full disclosure we have to say that every day. i have no idea where how it closes. my friend and colleague larry kudlow will be the president's chief economic advisor. i think this is a very good move. my take on that, coming up next. top of the hour.

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stuart: larry kudlow will be president trump's top economic advisor. good. i have known him for 30 years. he is a good man, personally and professionally. let's deal with the personal side first because it is important people know what that man, larry kudlow, has accomplished.

he was beaten, he has beaten, larry kudlow has beaten and cocaine and alcohol addiction. a quarter century ago in a much publicized breakdown his career went into spectacular collapse. he fought back. larry kudlow has been clean and sober for 23 years, for that alone he deserves our respect and admiration. professionally the man has always stood for growth and prosperity. i first met him in the early '80s when he worked on reagan tax cuts and expansion of economy still followed those cuts. he is still at it, cutting taxes growing economy, free trade. i thought kudlow's opposition to tariffs would keep him out of the trump team. that came a tweet from the president or statement, kudlow he says has come around to believing in tariffs as a negotiating point. that is a very important. tariffs are the opening gambit,

hard-nosed negotiating with china is beginning w kudlow on board this administration is about to negotiate the most morning relationship in the world. this afternoon microsoft founder, bill gates, will hole a private, no press meeting in the white house with the president. perhaps china's theft of intellectual property, like microsoft software will come up. maybe. it is all part of the china renegotiation. in the future kudlow will definitely be pushing tase two of tax cuts. kevin brady told us he is already working on that and the president brought up phase two again yesterday. all good for the economy. sum it up, the president has picked the right guy at the right time. reorganize trade with china, cut taxes more. grow the economy, kudlow is on board with it all. congratulations, larry. you're a good man. second hour of "varney & company" about to begin.

♪ stuart: real estate people, realtors, listen up. new mortgage rates. ashley: mortgage rates not by much but down to 4.4%, down from 4.46%. it is still above the 4% level but historically still very low but we've seen the 10-year treasury come down a bit. mortgage rates come down with them. stuart: every week, every thursday, 10:00 eastern, you and i, liz, we report the latest on mortgage rates. recent weeks, straight up. today, a pause. fractionally lower. >> yep. stuart: that is interesting. check the big board. no reaction on stock market to the mortgage rates. we do have the rally continuing. it is modest. 24,826. how about those big tech stocks? most of them are down today. only apple is up, just a

fraction. don't forget about it coin. we never do. it is down -- no, at $8300 a cain at the moment t was down earlier. now it is up 100 bucks. getting back to what i said at the top. hour, president trump tapped larry kudlow to replace gary cohn as his top economic advisor. t.j. group scott shellady is in london. i can't get over the sunglasses. good lord, cow man. do you think it's a good move for the market that larry kudlow is top economic advisor to the president? >> yes i do. i think the market will like larry and you in your opening gambit there. here is the thing though, stuart. as i listen to what you say, isn't it weird in this day and age we have to be so shocked by

common sense? it is driving me crazy. lower taxes, less regulation, infrastructure spending plan, oh by the way, gdp is rising? come on the world has lost its way, a guy like kudlow, there is any doubt he is for growth and that could be good for the economy. we just need more common sense in this world and i think we would be a lot more comfortable. stuart: i think it will be very good news for the economy if we do get phase two of tax cuts and some correction of the original bill. that is good news for the economy and the market. i want to talk to you, scott, what i think is the start of a complete renegotiation of our trading relationship with china. kudlow is on board with that, even though he doesn't particularly like tariffs. this is the start i think of something big. what say you? >> i agree. i don't particularly like tariffs either. this is an opening gambit. this is the way you get things and people to the table to start talking about it.

back to my common sense point, stuart. we just want fair trade, right? we're not pulling any thing on everybody, right? if people argue against it being fair. we want fair trade to get people to the trade you have to start turning the screws a little bit. again common sense. then we can all look each other in the eye and decide what the right way forward is. i think that is part of what bill gates will be doing in the white house. stuart: i see a lot of common sense if you cut through all the jargon about the negotiations. seems we want to impose tariffs on china the way they impose tariffs on our goods going there. that is reciprocal trade, reciprocal taxation. i call that common sense. i think the president will try to negotiate on that basis. >> you know what? we should start a third party. call it the common sense-ocaat, right? that will grow the economy.

we'll take away tariffs and fair trade or we charge you what you charge us. that is fair. at the end of the day it doesn't take a economic brain surgeon to figure this out. you just need to get people to the table. stuart: the market is listening what you say, they like what you say, common sense rules. we are now up over 100 points. thanks very much, scott, good to see you again. we'll see you shortly. >> see you. stuart: a shake-up in president trump's cabinet, especially the media, oh, it is chaos. there may be more changes coming down the pipe very be very soon. "washington times," political columnist, all around good guy, fox news contributor charles hurt is with us. do you see that -- there is this thing, it's chaos, it's chaos. we can't work like this. >> when people talk about the swamp, what they do. it has been it has been status quo for so long, both parties whether it is democrats or republicans we spend more money, more money we don't have, we go

farther into debt. we do all of these things and donald trump was the sort of the end of all of that. stuart: is it a little unnerving though? tillerson is out. gary cohn is out. >> for washington, it is incredibly unnerving. they are losing their minds. people are walking around like zombies, they're terrified what happened. they don't know what is next. they literally think the country will fall apart. why, i think being in washington too long you sort of develop a kind of a disease. you have to get out and find those common sense people that scott's talking about. in most of america, most of america, you could shut down half of the agencies in the federal government, and it would be years before the first person realized, you know, who didn't work there, who realized agency had been shut down. stuart: i can see how it is unnerving. i don't see how it is really affected the president's ability to push through his program?

>> the most remarkable thing of all of this, the removal of tillerson, the first issue he talked about was iran, how the two of them did not agree on iran. again he went right back to an issue that he had been mocked for not carrying out that he ran on. he ran on tearing up the deal with iran. he called it the worst deal ever made. and with the removal of tillerson after a year, he said i'm going back to that. the guy literally is going through the checklist and ticking off every single one of those items that he ran on. they got him elected. stuart: fascinating to watch. >> it really is. stuart: i want to raise this issue. the democrats are doing their best to paint trump tax cuts as negative. listen to what would woman in missouri to told the president about the so-called crumbs she received. >> i'm bonnie bra z i work in

the -- brazil, and work in the cafeteria of the college of the ozarks along with hard-working students. i'm very greatful when the bonus at the college gave it to us. i put my in savings for my retirement. and i want to thank you, mr. president, god bless you. stuart: oh in tearses, priceless i would say? >> i run into far more people like that, just around in the country than i do the people that are trying to, for example, the special election this pennsylvania 18, people are trying to glean from that that somehow the tax cuts didn't help or the tax cuts are a bad thing to run on. special electionses are special for a reason. they don't apply to everything else. i think that if republicans run on the tax cuts in a smart way, and highlight -- stuart: more tax cuts. more coming down the pike. >> yes. highlight voters like that, i think that they will do just fine. stuart: good stuff. all right, charles, thank you

very much. >> good to be with you. stuart: we'll see you later. steve wynn is now allowed to share his 12% stake in wynn resorts. he could sell part of it or all of it. there was a shareholder agreement that banned him from doing that before. now he is free to sell all or part if he wishes. the stock is at 185. it had plunged on the initial revelation. now this, i heart media is filing for bankruptcy. they have more than 850 radio stations t has $10 billion worth of outstanding debt. fewer people listening to the radio, so we're told. that hurts revenue from advertisements. there is report of a surge in uncompanied minors crossing the border. the numbers had been going down. we're asking border patrol union president brandon judd what is going on.

president trump welcomes the president of ireland to the white house. if he makes any comments you will hear them here. you're watching second hour of "varney & company." ♪

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stuart: there is a rally now. maybe the market likes larry kudlow at the white house helping the president with trade. maybe the market likes renegotiating the trade arrangement with china. whatever way you slice it we're up. most of the dow 30 is in the green. there is reportedly a surge in unaccompanied minors at the border. joining us border patrol union president brandon judd. is that correct? this is almost anecdotal reports but that's what we're maring. is it true? >> it is true.

right now it is anecdotal but when the agency releases numbers, it will be readily apparent more people are coming over. we're facing a problem, like what you saw with the fbi, we have these obama holdovers not implementing president trump's vision. if they don't implement the vision it becomes a lot more difficult. president trump did his job with the rhetoric we saw the huge drop in illegal immigration but because those individualses that are left over in the agencieses because they're not following through on implementing proper policies, those numbers are popping right back up. stuart: i understand that catch-and-release is back in force, get across, come over, you're caught. and then you are released. you're told to come back before a judge at some point in the future. they negative show up. we're back to that too? >> that is the main problem we're facing. just as an idea right now in the rio grande valley sector, that is only one sector in the border

patrol, we're holding approximately 1000 people that crossed the border illegally. those individuals should be deported. they claim asylum. we turn them over to i.c.e., they walk right out the front door. this is how smugglers, the multibill dollar industry. this is how smugglers recruit people to come to the united states to break our laws. they tell them all they have to do is come to be released. they can receive all the social programs and benefits. that is the problem we face. but until, until we get rid of the obama holdovers we implement proper policies we'll never get rid of this problem. stuart: brand done, you were with the president when he viewed prototypes of the wall in california the last couple days. you were there with him. what was his reaction? did the president like one particular prototype or another? >> he mentioned there were some prototypes that were going to

work and he mentioned some prototypes that weren't going to work. what a border patrol standpoint what we continue to advocate for, we want to see through the wall, so we see the threatses coming to know what is there. the president specifically mentioned that but what we like we like the bollard type fencing at bottom, with the complete barrier at the top, with cylinder at the very top so you can't put any grappling hooks. there are very good pretty tips out there. once we get the prototype out there, it will work. we'll control where illegal immigration takes place. stuart: give us the odds, what are the odds you think we get this thing built the next two years? what are the odds? >> the swamp is still the swamp. so look, i think that, this president is able to get things done and so, if i was a betting individual i would bet that this president is going to get the walls in strategic locations. stuart: brandon judd, thanks for being with us this morning.

appreciate it sir. >> thank you. stuart: new details emerging why john skipper left espn. we have this story earlier. ashley: yeah, he kind of had a tell-all interview with "the hollywood reporter" basically saying it all came to a head he was being extorted by the man he bought cocaine from. he realized he put himself, his family at risk and his professional life as soon as this came up. he came clean to everyone. went to bob iger at disney. look, i made a terrible mistake. i bought cocaine from a guy who is extorting me. they both agreed i have to quit right now. that explains the very abrupt dismissal of him back in december. stuart: i would call that a personal tragedy. liz: painful story. stuart: it is a painful story. now apple, you know apple, closing in on a trillion dollar market value. we're asking what does it have in the pipeline to propel it over the trillion dollar threshold? i think we've got an answer for

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stuart: the treasury department announcing new sanctions on russia. ash, this is about the election? ashley: there is more to it. they identified five russian entities, company or entities, related yes to interference, attempted interference into the

u.s. elections in 2016. but they also believe russian actors stopsable for attack on critcall infrastructure in the united states. inconcluding attacks on shipping lines, aviation, commercial facilities so on. it is ongoing battle against these cyber attacks many they believe originate in russia. so as a result we have these sanctions. stuart: more sanctions. toys "r" us is going out of completely selling stores or closing all of them in the u.s. i want to know, a, what impact on other toymakers, b, what impact on real estate? >> significant impact on toymakers like hasbro and mattel. stuart: why? >> 10% of mattel's annual sales is at toys "r" us. 10% of hasbro's volume is at toys "r" us. toys r us was incubator for small players. now the small players, not sure

where they go. the other big story, will the bankruptcy of toys "r" us create more ghost malls. 450, at lower end of strip malls, right? their anchor stores, it is hard to replace a 30,000-foot store when a toys "r" us goes. stuart: especially in this day and age, bricks and mortar. what about people with toys "r" us gift card? ashley: my best advice, cash it quickly as you can or use it. there is a good chance, if you don't, goes for bankruptcy, a bankruptcy judge, puts you holder at the that card very bottom of the totem pole. bank lenders and are security creditors. you are unscrewed creditor. chuck schumer is jumping in, to try to get sec for toys "r" us to honor gift cards. a competitor could come in, maybe for a little discount to honor discounts somewhere else to grab your business. bottom line if you don't use it good chance it will be worthless. stuart: do it today.

ashley: right now. stuart: dow industrials up 74 points. had been up over 100. up about 120 at some point. volatility is here. how we open is probably not how we will close. it has been 10 years since the collapse of bear stearns, remember it. it helped trigger the financial crisis. we have a guest who says the federal government could trigger the next financial crisis. democratic congressman joseph crowley says that republican attacks against nancy pelosi are secondsist. head of rnc, romney mcdaniel i will ask her about that. you critsize pelosi, you're sexist? ♪

♪ stuart: you say -- i'm not allowed to sing is. ashley: you're not allowed. stuart: you sipping for me. beatles, 10:30 eastern time we play the beatles every day. liz: sing it. stuart: because i want it. the rally is back on, ladies and gentlemen, and now we're up 111 points and climbing. now 113. 24,871. how is big tech doing. some of them up. facebook, amazon are down, microsoft, apple are up. next case, i don't want to get too technical here, but the atlanta fed first off said we'll go back to 5% this year. they scaled it all the way back down to a growth rate of 1.9%. is this a sign that our economy is slowing down a bit? retired economics professor

peter morici is with us now. >> i'm on emeritus professor. stuart: i get that right. emeritus professor. okay, okay, i did work that out. are we slowing down? >> yes, we are. we're having our usual winter doldrums. not as bad as last year but we seem to be having it. economists hoped that the tax cut would avoid that but it hasn't. what has been going on since the financial crisis is that consumers take a pause in january and february to pay off their credit cards and regroup after the holidays. they're not running down to the bank to take out a home equity loan to keep on spending. it is that simple. stuart: okay. so we are slowing down. i want to show you this. this is a headline from foxnews.com. the headline is, 10 years after the financial crisis uncle sam could trigger the next one. well, peter you wrote that article. >> yes i did. stuart: i know you did.

are you talking about the debt bomb here? >> yes. i'm not talking about the way people normally do, 110% of gdp or something like this. what matters what americans owe the rest of the world, between the government and private debt and what they owe us, and on that net basis that is around 45% now. once you get to 60%, you get into the territory that greece, ireland were in. no country crossed the 60% threshold without a major financial adjustment, re, crisis. we could print money. won't do us any good if they don't buy the bond. they buy the bond, not the money. we're starting to see u.s. securities losing a premium in international bond markets. a couple weeks ago, when the treasury rate went up, foreign investors didn't rush into to grab them.

they're as risk-free as they used to be which tells me we're starting to get to the point. stuart: when do we get to the 60% threshold? >> sometime next five to 10 years. stuart: that is a long way off, peter. >> not when you have one trillion dollars deficits and they get bigger every year. until the recent tax cut, recent budget deal it was 10 years out on the track we're on. now it is a lot closer. if they spend more money without financing it will be even be closer. for example, a infrastructure program not financed by revenue. this is serious stuff. you can get to the point where your debt is unmanageable. what happens is, we'll have to pay higher and higher interest rates to finance the debt. then that will become a circular thing. it will feedback. either we cut spending, we borrow more and pushes up interest rate even further. we'll get to the point where the bond market basically disciplines the government into cutting the deficit. stuart: the trouble with the debt bomb story, it is always years away before it actually

hits. so don't people that don't care about it, because it has not hit yet. >> the thing, once within two years away. it is awfully tough to put it off. you start to get to the point where you're selling your parking meters and parking spaces in the airport and things like that. this is something that has to be addressed now. it wasn't addressed now. you know, i've, liberal democratic economists around town say to me, peter, i don't believe washington, that the government will every run out of money. no it won't, it can print so much of it that nobody takes it. stuart: all right, peter, thanks for joining us. see you real soon. professor emeritus. i get it right. i want to talk about apple. they are closing in on a market value of one trillion dollars. lance ulanoff is with us. he is our tech expert. he our go-to kind of guy. they need to get to $195 per share to hit a trillion dollar

market value. >> right. stuart: what do they have in the pipeline that will push them over that level? >> if you ask apple they say lots of cool stuff. stuart: you tell me. >> there are rumors about the macbook air. i think they're done with the name air. it will be cheaper device. retina display comes out in june. stuart: that is not big enough. >> there is another rumor, you look and see people with airpods in their ears? it has blown up. a blockbuster product for them. talking about maybe having airpods over the ears, high-end model to carry on. stuart: that doesn't push you over $195 a share. i don't think it does. >> it is all, look, when apple comes out with a new product it tends to sell millions of them. can move the needle. they will have updated iphones later in the year. more affordable, this will be very important there, questions about whether or not iphone x sold at the scale they wanted

and obviously the iphone 8 and 8 plus don't have button-free screen. imagine more affordable iphones, button-free screen. those could sell like gangbusters. that is the really critical quarter at the end of the year. stuart: what we're saying on the show, homepods, home speakers, amazon echo, apple's homepod, google nests something like that, i think they are the most important new tech device since the arrival of the smartphone. now am i going oh board? >> no, i don't think you are are. if you need proof, amazon buying ring for billion dollars. that is an indication this is superhot category. nest came out with their hello, basically the same thing, competitor to ring. all the money, all the research and development for a lot of these companies going into the smart home device. consumers overcoming fears of tracked or being watched.

convenience outweighs everything else. they love the idea of having a camera in their home, whether they can check home or away coming to the door. stuart: the device is companion, computerized companion in your home. >> interesting you say that, getting there. conversationally not there yet. amazon is running a contest to have people do 20 minute conversation with alexa. some research remembers getting really close. in the next couple years your conversations with alexa and siri and others are really going to transform. they are going to be like the friend apparently you need. [laughter]. stuart: i just can't wait for a conversation with a computer. i got to talk to you about volkswagen. they say, vw. they say they will overtake tesla in the electric car market. are you getting worried about tesla? >> i am getting very worried about tesla. i love their products and model 3 which i drove. they seem to can't deliver them. 1400 in fourth quarter. they want to deliver 10,000. they're struggling to get to

that level. musk says it is so difficult to produce them at that scale. but he says they will get there. the problem they're now facing a direct competitor, direct competition with major auto manufacturers which have the production scale, which have distribution, which have the connection with consumers that they don't. they were selling the luxury ideal of electric, model 3, supposed to be consumer ideal. now they will compete fence people with the juice to deliver to scale quickly. stuart: if only tesla could have produced and sold 10,000 of these the model 3s, back when they were supposed to, it would have a lead in the market. liz: no kidding. >> not going to count them out yet but i will make a crazy, say something crazy. tesla should sell. stuart: tesla should sell what? >> themselves. stuart: sell themselves is? >> interesting. i think it is time for musk to sell tesla to a bigger auto manufacturer and basically sell batteries to the companies. stuart: he will never do it. >> i doubt he will.

if he doesn't really accelerate by the second half of this year it is going to be very difficult to not do that. stuart: maybe they will wait until the stock gets battered and then somebody could buy at a vastly reduced price, if that were to happen. i don't know. i don't know. all right, lance, you're all right. thanks for joining us sir. much obliged to you. got it. st. patrick's day spending set to hit a record this year. wait a minute. i don't like these numbers. i don't trust these numbers. tell me what the number is anyway. liz: you say you see a lot of blarney in the numbers. you don't believe it. they're saying national retail federation, nearly $6 billion is what people will spend on st. patrick's day. 149 million plan to celebrate. 18 to 24-year-olds love it. guinness says 13 million pints of guinness are consumed. ashley: that i believe. liz: since you're being sew cruddy, can i tell you my

favorite st. patrick's day joke guaranteed to give you a free pint? stuart: go. ashley: we get a free pint? liz: worked for me. stuart: go. liz: what is 25-yards long and has two teeth? stuart: 25-yard long, two teeth. tell us. liz: the line outside after irish pub on sunday morning. my parents will kill me. stuart: not bad. not bad. liz: i'm irish woman. i'm allowed to say it. stuart: that is why we give you the story. i don't believe it. liz: it is blarney. i agree. stuart: paul ryan, he is warning that the pennsylvania election is wake-up call for republicans. next tennessee congressman, candidate for the senate marcia blackburn, is she worried about november? russia continuing to face condemnation over the poisoning over that ex-russian spy in britain. nigel farage, he gives us his take on it in our next hour. ♪

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♪ ashley: in the last hour we spoke with former reagan economist art laffer about president trump's business tactics when it comes to tariffs. roll tape. >> i have always believed that the president was using tariffs as a negotiating position. i think they have worked. he has done it. before even was elected i just can't believe any man who run a big business like donald trump has, i joked, he said it was supporting two former wives, i don't see how anyone like that could not believe in free trade. he understands international business and understands negotiation and how do you bring mexico and canada renegotiate this awful, awful treaty called nafta. badly written. ♪ how do you win at business? stay at la quinta. where we're changing with stylish make-overs. then at your next meeting, set your seat height to its maximum level.

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stuart: well look at this. williams-sonoma comes out with a rosy forecast for the future. they raised the dividend. they say they will buy back some of their own shares. that does a power of good to the stock price. higher sales at dollar general, that works. that gets the stock price up, 5% in that case. blue apron, up after a report that the company will sell meal kits in stores, okay? they like that. nearly 4% higher. house speaker paul ryan, he calls the pennsylvania election

a wake-up call for, republican, the gop. joining us now to discuss tennessee congresswoman marcia blackburn who is also running for the senate. marcia, welcome back. where have you been? >> working. stuart: yes, you have. are you worried about, about, if the pennsylvania as ryan says it's a wake-up call. >> sure. stuart: are you worried about november? >> no. i got to tell you, stuart, i think the lesson coming out of pennsylvania was you had two candidates, each of them tried to get as close to donald trump and his agenda as they possibly could. i thought it was interesting that the democrats he wouldn't back and support pelosi. stuart: when, you are running for the senate in tennessee, are you running as a trump supporter, or, the man, the president, or are you running as a supporter of his growth plan and his return to prosperity? which is it? >> let me tell you, i have

always told people you might not always agree with me but you're going to know where i stand and supporting the president and the work that he is doing, and also supporting his agenda, and the agenda that the white house has. what we know is, people want tax cutters. they don't want tax-and-spend liberals. they want individuals who can make decisions and the president does that. they want individuals that are going to secure the southern border and are going to build the wall. the president is doing that. the american people support him and support his agenda. and, i am proud to stand with the president. and to support the work that he is doing. it is what people elected him to do. he is delivering on that agenda. and i think they want to see more of it, and that was evident this week in pennsylvania 18. stuart: marcia, i want to play you a sound bite from kevin

brady, chair of the house ways and means committee, set tax writer guy. he was on the program yesterday, and we were discussing a second phase of tax cuts. watch this. >> we think even more can be done. we want to make sure that we're encouraging innovation in america. we want to help families save for the long term. also while the tax cuts for families were long term, they're not yet permanent. so we're going to address issues like that. stuart: that pretty much confirms, it marcia. they want to make the cuts permanent as opposed to temporary. i'm sure u in favor of this. will it get done this year? >> i'm sure it gets done this year. we talk it art laffer. he is working with the white house and the president on the tax cuts. and i tell you what, before he ink was drying on tax cuts one, art laffer was already talking about what we ought to do for tax cuts two.

making them permanent. getting some of those rates a little bit lower. providing more money for individual in their paychecks so hard-working taxpayers are keeping those paychecks. this is something we're seeing growth in the economy. we want to see that growth, at the same time we want to continue for regulatory relief. so that regulation is getting off the back and out of the pocketbook of hard-working tennesseans and hard-working americans. stuart: tennessee has done extremely well from the original tax cut plan because you're a low-tax state. you must be getting a flood of people from new jersey and new york and every place else. you're the retirement call tall of the planet these days. >> california. you're exactly right. in middle tennessee, there are 101 relocations every single day from high-taxed states, california, new york. come on down, stuart. stuart: i would love to. i will take a pause.

marsha, thanks for joining us, we appreciate it. left hand side of your screen, everyone. you're looking at the white house. we're expecting the arrival of the prime minister of ireland any moment now. today is march the 15. as you obviously know march 17th is st. patrick's day. almost annual tradition the prime minister of ireland, comes to america, goes to the white house on or around sate patrick's day. that is about what you're it see now. he has not arrived yet. when he does you will know about it. and we'll, be back after this. is why 7 million investors work with edward jones.

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whether you're on medicare now or turning 65 soon, it's a good time to get your ducks in a row. duck: quack! call to request your free decision guide now. because the time to think about tomorrow is today. stuart: ireland's prime minister just arriving right there at the white house. greeted by president trump. again we say. it is march the 15th. two days from now it is st. patrick's day. almost traditional ireland's prime minister comes around st. patrick's day. he is in the white house now. how is this for craziness. 90% of college presidents are worried that a liberal bias is hurting higher education. how about that? the same study shows 61% of

students believes colleges are deterring conservative speech on campus. interesting stuff. liz: yes. stuart: who did this? campus reform media director cabot phillips is here now. this is as astonishing, 80, 90% of college presidents accept what is going on is hurting their redcation. >> this is not a new phenomenon. this is going on for years, well, maybe it's a problem. people don't know what is liberal bias on college campus? how does it manifest itself? first in the classroom. the professor, ranting and raving against conservative ideas. conservative groups get far less funding. did a recent study at university of wisconsin. 20 times funding for liberal groups than conservative ones. third for speakers, administrators put hindrances, barriers on conservative speakers. welcoming in liberal speakers, conservative you have to pay $10,000 in security fees.

many times they are not allowed to come into campus. that is what liberal bias looks like. stuart: when will this end? as your study suggests this, when does it ebbed? >> it starts with accountability. once taxpayers say we will not send money to institutions failing students. once administrators feel pressure and market force, we'll not send our students if they don't allow a true marketplace of ideas taking place. stuart: will parents say that? if your son or daughter gets into harvard, will you turn around he or she is not going there because she is bunch of liberals? >> that is individual decision what parents have to make what they value in education. if you go out in the real world, going into a college not preparing for you the real world, here is what you think, here is how you should think, not here is how to develop your own personal philosophy, you need to decide the is

prestigious school worth it and the big debt worth it? i talk to students around the country, with campus reform, they say one thing universally i'm scared to let people know i'm conservative. i want to get involved. i can't let people know i'm conservative. they fear for grades and violence just for being conservative. stuart: keep up the good work, young man, we admire what you do cabot phillips. appreciate it. and the divisions among democrats becoming obvious especially when comes to nancy pelosi. you will hear my take on that in a moment as well as reaction from the ronna romney mcdaniel. the dow is up 107. ♪ in the corps, so i'm not happy unless my hands are dirty. between running a business and four kids, we're busy. auto insurance,

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stuart: we have spent a lot of time recently looking at the splintering, divided democrats,

and rightly so. somebody's got to do it. we all need a counterbalance to the media's endless sniping at what they call chaos in the white house. you don't hear much about it, but the left is not united. in short, the old guard leadership is being challenged. item one, conor lamb, the democrat who leads in the pennsylvania special election. now, he did well by repudiating his own party leaders. i don't support nancy pelosi, he came right out with it and said it. today politico reports other democrats have taken note. a texas democrat says running against nancy pelosi is going to help you. candidates are organizing their campaign for november, and politico says more and more of them will follow conor lamb's lead and ditch their own leadership. ms. pelosi's "crumbs" comment remains a real problem. item two, joe crowley, one of the top democrats in the house, he says the gop is sexist for

attacking pelosi in campaigns. so there's a clear divide between the leadership and the rank and file. again, lamb, democrat, himself running against pelosi. lamb is the face of the democrats' supposed blue wave. well, is he sexist running against pelosi? don't be blindsided by the media's endless anti-trump propaganda. the divisions among the democrats are becoming obvious, and we are on that story. guaranteed. the third hour of "varney & company" is about to begin. ♪ ♪ [audio difficulty] >> failing at this point. and i think, quite frankly, it's sexist. stuart: well, there you have it, democrat congressman joseph crowley. ronna romney mcdaniel with is

us, he says if you attack pelosi, you're sexist. and you say what? >> he should go say that to conor lamb who just attacked nancy pelosi, and i'll remember that, stuart, the next time the democrat party attacks me as the head of the rnc. we know as women when we get into this business we're going to have criticisms against us. nancy pelosi was against cap and trade. she called this tax cut where people are getting thousands of dollars in bonuses crumbs. in pennsylvania, especially in pennsylvania 18, that doesn't hold water, and her candidate ran against her, so crowley should talk to his candidates who are going to use this playbook of running against nancy pelosi and tell them they're all sexist. stuart: well, what's your plan for november? you've got to have a plan. are you running against nancy pelosi? are you putting her in ads and saying it's crumbs to her, but it's a tax break for you? are you going after her still? >> yeah, it's not just nancy pelosi because no democrat voted

for these tax cuts, especially on the senate side. they just did not support more money coming to the average working american who are mow seeing bigger paychecks as a result, more jobs coming to this country as a result. so the democrats are going to have to account for why they voted against middle class tax cuts. nancy pelosi calling it crumbs is ridiculous, it's insulting to families who are living paycheck to paycheck who can use that money to pay rent and put food on the table. it shows how out of touch they are, so we're going to highlight that. but we're going to run against the democrat party which is the part of no, the party of obstruct and the party of getting nothing done with this president who is working to help the american people. stuart: are you running on the basis of president trump's agenda and his policies and what he's done for the economy, or are you running on trump, the iconoclast, the man, the breaker of all traditions, totally different guy in the white house? which one are you running on? >> well, i think it's both

because president trump came to washington and said the status quo isn't going to work here. it's not working for average more than families. so we're going to start getting -- average american families. so we're going to start getting things done. now with the tax cuts you're seeing what our economy can actually achieve. so it took a change agent, somebody like donald trump, to come and lead. so voters are going to need to support republicans so he can continue his agenda. in pennsylvania he helped lift our candidate. we know that he brings energy to our base like no other person in our party. but our policies are making lives better, and that's what we're going to put forward to the american people. your lives are better because of republican leadership. stuart: okay, we hear it, and thanks very much for joining us. i'm breaking in real fast just to show you what's going oven in the stock market -- on in the stock market. we're up 165 points, 25 of the dow 30 are in the green, and we're very close to getting back to the 25,000 level.

now, one thing in the background here is interest rates. will you look at that? the key interest rate to watch, the mover and shaker of markets is the ten-year treasury yield. right now it's 2.81%. it's actually trending down. >> interesting. stuart: surprise, surprise. gary kaltbaum is with us, caught balm capital management, he's the president thereof, and he's a fox news contributor. now, i've got jeffrey gunlash, he's a famous money manager, big hitter on wall street. he says if that ten-year treasury yield goes to 3%, this bull market is over. i don't agree with that, but do you? >> i disagree with that. i think the market can come down because of it only because we've hit 3% a few times, and then we keep coming lower. so a break above it will affect things, but that doesn't mean then end of the bull market. i think you're going to have to have a lot more things have to happen. and, look, if we go above 3%, it's still very, very low.

al beit we were down at 1.3% a couple times in the last three years. cost of capital goes up, cost of loans go up, but doesn't mean we go into a big bear market. stuart: what do you think of larry kudlow as the new economic council head replacing gary cohn? i think he's going to be quarterbacking the new trade relationship with china, and i think he's going to be quarterbacking some of the tax changes which we expect to see later this year. you okay with all of that? >> yeah. of and i would have picked him in the first place. i loved him, i love steve moore. i'm a big free market guy. i love lower taxes, less regulations. but there's one thing that's still sticking out for me that i'm hoping larry kudlow comes in and convinces the republican party or and trump to start looking at, and that is the debt and the deficits that continue to skyrocket with nobody doing anything about it. and we can talk tax cuts til we're blue in the face.

if debt keeps going up, deficits keep going up, that's going to be a headwind. so, hopefully, he addresses that. and i know he's into smaller government, so let's see what happens. i'm hopeful -- stuart: well, held on. gary, one second. just a few minutes ago we had economics professor peter morici on the show. he said that the debt bomb doesn't hit for another five years. now, that's a long way away on worrying about the debt bomb. >> i don't even know what i'm eating for dinner tonight, let alone what's going to happen in five years. and, look, all i can tell you is every day now $3 billion is added to our debt. this year a trillion dollars and every year after. and, stuart, the first $400 billion of our taxpayer dollars next year is going towards interest. in a few years it's going to be $700 billion. we cannot continue -- stuart: you're right. hold on a second. i've got to go to the president who is greeting the irish prime minister. listen in, please. >> i have property there, and i

may never get to see it again, but i will tell -- >> [inaudible] >> i do play golf. you play golf, right? >> i don't, but i'm always willing to learn. so you can take me for a few rounds. >> are you going to fix the border, mr. president, with northern ireland? >> well, that's an interesting border also. we have two interesting borders. one happens to be where you are, right? >> that's right. >> it's my great honor to have the very popular prime minister of ireland with us, and we, we're having some good talks about trade and about military and about cyber and all of the other things that we're talking about. the relationship is outstanding and only getting better, and it really is a very special group of people. a tremendous number of irish are living in new york where i grew up, and they're living in the united states, and these are truly wonderful people. we love 'em. and, mr. prime minister, great to have you. thank you.

>> my pleasure. thanks for the invitation to be here. >> [inaudible] >> so i'm going to be in new york, in new york on saturday. >> oh, good. wow, that's good. that's good, i'd like to do it with you. i don't know -- >> [inaudible] >> it does. it goes right by trump tower. i used to watch it all the time. i would watch it all the time. so you'll be there on saturday? >> yeah. so a lot of my -- more than side of my family came to new york. they're all in new jersey and florida now. >> that's right. that makes sense. this is the first time in the oval office -- >> i thank president trump. i was here before as a congressional intern back in 2000, but they didn't let me into the oval office on that occasion. >> but now we do. you've made great progress. thank you for being with us. >> absolutely. look forward to -- >> [inaudible] mr. president? >> [inaudible] >> it looks like it. i spoke with the prime minister,

and we are in deep discussions, a very sad situation. it certainly looks like the russians were behind it. something that should never, ever happen, and we're taking it very seriously. as, i think, are many others. >> any more staff changes coming, sir? >> well, the story was very false. i mean, they wrote a story about staff changes today that was very false. we've made a wonderful change, i think. mike pompeo is going to be an incredible secretary of state. we have some wonderful ideas. i've gotten to know a lot of people over the last year. i've been in washington for a little bit more than a year where somebody have been here for 30 or 40 years. i've gotten to know great people, so there'll always be change, but very little -- that was a very false story, a very exaggerated and false story. but there'll always be change, and i think you want to see change. and i want to also see different ideas. larry kudlow just came in a little while ago, and i think larry is going to be outstanding as economic adviser.

is so we look forward to it. but we'll talk to you about it later. thank you very much, everybody. thank you. >> thank you, mr. president. >> thank you, everybody. [inaudible conversations] >> thank you very much. >> thanks, everyone. >> [inaudible] >> it could happen. that could happen. [inaudible conversations] maybe if that helps. i look forward to being there. it's a great, great country. i guess i have received a formal -- >> [inaudible] >> thank you, everyone. >> i'd go to the border. [inaudible conversations] >> thanks, guys. >> thank you all very much. thank you. >> thank you all. >> thank you. [inaudible conversations] >> say hello to the people. say hello. great people. stuart: the president tries to end it -- >> but he can't help it. stuart: -- but he can't quite resist answering a question. now, the president just said right out there it looks like the russians were behind the poisoning of the former spy in britain. and by the way, earlier today

france and germany joined the british in blaming russia. nigel farage is with us now, fox news contributor. nigel, you're in the thick of us in london. >> yeah. stuart: it seems to be escalating really sharply at this point. what's the latest? >> yes, it is. in terms of theresa may taking the toughest action we've seen since the cold war, expelling diplomats, talking about looking at russian money and bank accounts in london, the royal family not attending the world cup soccer that's coming up in russia this summer. so, yeah, a lot of action's been taken. a consensus here, a global consensus surrounds an idea that it was not just russian people that did this, but that it was the russian administration that did this. and i hope they're right, because they haven't actually got any evidence. what they've got is they know this chemical was produced in russia, but i just -- for the sake of people's faith and trust in politics and our leaders, i hope they're right.

stuart: i can't imagine what the feeling must be like in britain when you've got this clearly deadly nerve agents loose in a part of the country. was the reaction panic? rage? anger? what was it? >> oh, i think in salisbury, which is, you know, a sort of middling sized market town, we call it a city because it's got a cathedral, but it's not a big place. and, you know, for 500 people to be told they must scrupulously wash their clothes, their glasses, their rings, whatever it may be, people are really worried about this. we now have further down the road in the adjoining county another potential area where this nerve agent is. so i do think in that part of the world people are very worried. is there panic among the public at large? no. i think we see this as sort of an attempted killing as part of a vendetta that basically got botched. but what we don't know is whether the russian state

sanctioned this or whether somebody with access to materials was seeking to settle a score. and that's the bit we simply don't know. stuart: i remember when kim jong un of north korea had one of his relatives killed in an airport -- i think it was in malaysia -- using some kind of nerve poison gas agent. at the time, that was called tantamount to an act of war. now you've got this attack with a nerve agent in britain. in your mind, nigel, is it an act of war if it's shown that it is the russian government or military that did it? >> well, what it certainly is, is an act of terror i feel. you know, had this -- terrorism. had this been an extreme right-wing group, we would now be calling it terrorist. this needs to be called terrorist. if we can prove that vladimir putin sanctioned not just the taking out of a former agent who he himself sees as a traitor, but endangering the lives of hundreds of people in a british city, then that would be

tantamount to an act of war. but i do, as i say, advise caution. because in my experience, when you get unanimity in politics, when everybody agrees, they're not always right. [laughter] stuart: we shall remember that, nigel farage. good to see you again, sir. >> thank you. stuart: okay. i bring your attention, ladies and gentlemen, to that stock market. look at this. rip roaring, here we go. we're up 230 points as we speak, 24,992. i i believe the market looks favorably on larry kudlow -- >> yeah. stuart: -- moving to the white house and the new tax cut deal that we might be seeing and this new relationship with china vis-a-vis trade. >> yeah. and also solid leading economic indicators coming in from the philly fed and the empire manufacturing. stuart: and the president did just say that the reports of chaos in the white house are, what'd he say, grossly exaggerated? that's my language. >> very false. [laughter] stuart: o.k.. next up, a judge has ruled that

one town in ohio must pay back millions of fines collected from their red light camera. there's a reason for it. we'll have the judge on that in a moment. "special report" host and fox news starr bret baier is with us. what's he think about the shake-up of the president's cabinet and who might be next? looks like a normal home, single story, one bedroom, one bathroom, but there's something different about it, and we'll tell you what it is next. the world happiness report, i have to get this in. can can you guess which country is the happiest? >> i know it. i can guess. stuart: you've seen the prompter. >> no, i didn't. stuart: we'll tell you after this. [laughter] ♪ ♪

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stuart: yeah, we asked you before the b, and the happiest country in the world is -- >> finland. i am sorry, i'm sorry. stuart: norway slipped to number two. finland beat out all others in the six key areas that they say contribute, income, freedom,

trust, life expectancy, social support and generosity. the u.s. fell four slots down to number 18. >> why? stuart: because of obesity, opioids and depression. now, the house that's on your screen right now partially built by a 3-d printing row -- robot. the house is 650 square feet, the robot can print the walls, the floor, the roof in 12 hours. a 3-d printed house. >> interesting. stuart: lexus, they plan to start selling luxury yachts the second half of next year. 65-foot yacht, that's the prototype. it'll have enough room for 15 guests, three bedrooms with their own bath rooms, separate rooms for the crew. no word on the price of the luxury toyota yacht. >> that can't be it. stuart: the british luxury consider car maker, aston martin, hoping to have two pure new electric models by 2023.

they'll be powered by batteries under the floor with an electric motor for each wheel. it's probably the first luxury brand to offer pure electric vehicles. >> james bond. stuart: would he touch that? >> yeah. stuart: looks good though. doctors in northern ireland found an air pocket inside an 84-year-old man's skull where the right frontal lobe, i should say, should be. this pocket is caused by a condition found in patients after brain surgery or after occurrence of sinus infections. the patient declined surgery to remove it. despite warnings from doctors, three months later he remains in good condition. [laughter] >> wow. stuart: seriously now, the deputy fbi director, andrew mccabe, set to retire sunday, but hkd be fired before -- but he could be fired before then. if he was, he'd lose his pension. we'll ask the judge about that one in a moment. the president's meeting with the prime minister of ireland.

he's already said the russians are behind the nerve agent attack in britain, and the reports of chaos in the white house are very false. investors seem to like what's going on today. maybe they like larry kudlow in the white house because the dow is at 270 points, we're back above 25,000. more "varney" coming up for you. ♪ ♪

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stuart: earlier this hour the presidentd the russians are behind the nerve agent attack in britain. he also said there is no chaos in the white house. he calls those reports very false. he is currently meeting with the prime minister of ireland behind closed doors in the white house. we expect to see them again later this hour when they emerge from those talks. sometimes the president addresses the cameras which are always there, and if he does, you'll see what he has to say. finish i want to draw your attention to the dow industrials, because this looks pretty good, does it not? we're up now 280 points, well over a 1% gain. it's a sea of green on the left-hand side of your screen. almost all of the dow 30 are on the upside, and we're back above 25,000. now i want to talk about tax

cuts. the president says phase two of tax cuts are coming. with us now, winnie sun, sun group wealth partners founder. >> thanks for having me. stuart: if we do get more tax cuts coming, do you think that's good for the market? >> that's what we want to hear. stuart: okay. do you think the market will go up some more from where it is now? >> i think so. stuart: how much? >> i don't know, but i think it's enough to make us really excited about shopping again. >> shopping? >> uh-huh, in terms of investing, getting back into the market, getting, you know, of the days like this again. stuart: okay. you manage the money of tv stars, movie stars and other people in the tv and movie industry, is that correct? >> that's true. stuart: what are you telling them to do? >> well, you know, we're talking about really continue to invest, continue -- stuart: in stocks? >> in stocks, absolutely, because your time horizon is long. they have high income, and they're getting potentially another nice tax brach.

so that mean -- break. so that means we have more money we can get working for their retirement. stuart: i take it that people like that in the movie and tv industry, they're pretty close to technology. >> they are. stuart: big smile there. have you been putting them into the big tech stocks? >> certainly at the space they're very comfortable with, so we do have an allocation in technology. and i think, you know, being that we're in southern california, we're in the home of facebook and apple and everything else, that's something that they know very, very well. stuart: now, you're in southern california, and you manage the money of tv and movie people. >> yes. stuart: do they all hate trump? >> well -- [laughter] that's a great question. they certainly have a strong opinion regarding trump. stuart: well, they're participating in the trump rally. if they don't like trump, how do they feel about participating in the trump rally which has made them a lot of money in. >> well, i think they certainly appreciate all the tax benefits, is they're happy. [laughter]

stuart: you don't want to tell me your clients hate trump but cash in on the rally, do you? >> i think my clients are smart people, and they're reasonable to appreciate what they've been given. and certainly having a little bit more money at the end of april is a good thing. stuart: so i'll leave it like this, your position is you want to see more tax cuts. your people would really appreciate that -- >> certainly. stuart: and the market will go up because of this tax cut talk again? >> yes. i think for the short term it'll certainly be a great benefit for us. stuart: and you think this market will end the year higher than where it is now, would you say that? >> if we see those cuts, yes, i think so. stuart: winnie, we'll have you back. i want to know whose money you manage. >> i won't tell you that. [laughter] stuart: thanks for joining us. >> thank you so much for having me. stuart: headline in "the wall street journal," i'm not sure i understand it, but we're going to talk to the author, dan henninger is the guy who wrote this. march madness in pa-18. that refers to the special

election in congressional district number 18. >> yes. stuart: what's march madness got to do with it? tell me. [laughter] >> well, it's that time of year, stuart, and we have our annual division i basketball tournament -- stuart: i know that, i know that. [laughter] >> it's called march madness. it gets tremendous competition. and we had, now in politics we have the equivalent of march madness virtually every day, every week of the year. it's all politics all the time. it's all about competition, and this was about state senator rick saccone versus newcomer conor lamb. and it went down to -- it was what we call a buzzer-beater in basketball. stuart: so you're drawing a parallel -- you're right. i mean, it is all politics all the time. i've never been in such a concentrated political atmosphere as the one we're now in. >> well, my point is, look, we have a special congressional election in southwestern pennsylvania just south of pittsburgh, and this has been

elevated. these two people to implications for the entire republican and democratic party across the united states. and the question is, is that a valid migration from one little race to the rest of the party. to the extent it is, but we have my point here was to look not so much at what it implied for the republicans -- and they do have problems -- but what does this mean about the democratic party? conor lamb ran a little bit right of center. he disavowed nancy pelosi. so in all of the other races going forward, who are the democrats going to be representing? the conor lambs of the world or nancy pelosi? bernie sanders' college campus socialists or joe biden's working class democrats. stuart: it's a real split, isn't it? >> it's a clear split between the identity politics of the coast, new york, manhattan, hollywood, late night comedians, and then these heartland democrats like conor lamb or tim

ryan of ohio, representative tim ryan, who challenged nancy pelosi. this should be about the economy. it should not be about race, it shouldn't be about gender. stuart: is it almost an age thing as well? i mean, democrat leadership is aging. >> oh, no question. stuart: nancy pelosi, late 70s. steny hoyer, late 70s. bernie sanders, mid to late 70s -- >> joe biden. >> chuck schumer. stuart: joe biden is well into his 70s. so am i, but that's another story -- [laughter] quiet on the set. the judge is here, you'll just have to wait for a second, but it's the old guard leadership which is facing an increasing threat. >> you know, you put your finger on an interesting paradox here, stuart, which is that's true. the identity politics, led by a lot of older politicians, but it's coming out of the campuses from a lot of 20-year-olds and so forth. nonetheless, the new democratic candidates where there was john o to soff in georgia 6, northam

in virginia, conor lamb, who are relatively younger, they seem to be my grating back towards the center to win elections. so the question is when exactly does the electorate believe about these issues. where do they want to be, on the far left, the far right or somewhere toward the middle? stuart: but if the democrat party is moving more towards the party of jfk where you could cut taxes and grow the economy, i think we'd all breathe a sigh of relief -- >> but they're not. you know they're not, not at the national level. they're trying to say the tax cuts are fake, they only benefited the wealthy. so i think the task for the republicans will be not mere hi to represent themselves -- merely to represent themselves in november, but point out what the democrats really stand for. and i think at the moment they stand more for nancy pelosi than conor lamb. stuart: march madness in pa-18 -- >> who do you like in the ncaa,

stuart? duke? kansas? stuart: duke. [laughter] the london school of economics. or syracuse. i could go for syracuse. [laughter] >> must be listening to you and danny, she just announced -- stuart: who? >> mrs. pelosi. stuart: yes? >> that, in fact, congressman-elect lamb likes her and did not run against her. stuart: okay. >> and she welcomes him as a colleague. stuart: we've got sound on that, and we'll get anytime a second. dan, thank you very much, indeed. stay silent for a second. [laughter] deputy fbi director andrew mccabe could be fired and his pension would be in jeopardy if he's fired today, tomorrow or saturday. all rise, napolitano is here. now, he's due to retire sunday. >> yes. stuart: if he was fired before then, he does lose his pension, does he? >> well, it would depend on the reason for which he's fired. if he is fired for cause -- and the fbi regulations specifically say deceiving or misleading

investigators in an official fbi investigation is cause for firing. stuart: ah. that would be important. >> it is not the leaking. the fbi is very good at leaking. if they fired all fbi agents who leaked, they'd have to rehire an fbi. it's about lying about the leaking to investigators. that would be the basis for the firing. stuart: if he was fired on that basis, wouldn't that encourage the i view that, yes, there was a cabal within the fbi that protected hillary and went after trump? >> stuart, he's the poster boy for the cabal. he's the poster boy for a politicized and morally relativist fbi. if he's going to be fired for those reasons, i can understand it. if he's going to be fired because the president hates him or because jeff sessions wants to keep his job and thinks this will please the president, they're going to undo the firing, and he's going to collect his pension. stuart: okay. here's something that i'm really interested in. a federal judge -- a federal court, i should say, ruled that a small town in ohio must pay

back millions of fines, millions of dollars worth of fines which were collected from those red light cameras which catch you if you're in the middle of the crossing and it goes to red or something. >> known in the business as scameras, because shortness of time on the yellow, on the amber light is such that it is nearly impossible to get through the intersection before the red comes on. they are just cash cows. stuart: was that the reason that the court said give them their money back? >> yes. stuart: but they couldn't go further? >> but the use of these to steal money from unwitting drivers itself is a federal offense, and i wish that the federal prosecutors had taken one ten further and prosecuted -- one step further and prosecuted the police and municipal authorities who use these devices. but giving the cash back is a step in the right direction. stuart: now, will it spread else where? >> in new jersey there is a statute that even though these cameras are up there, they

cannot be used as a charge. they can be used to recreate an accident, they're very helpful. but the camera can't give you the ticket. the camera, not a human being, the camera was issuing the ticket. i hope it spreads like a wildfire across the land. stuart: i like the word scamera, because that's accurate. >> do they have them in great britain? >> they started 20 years ago. it's terrible. stuart: i haven't been in england in nearly 14 years, and i haven't been to london in 25 years -- >> and he's not welcome back. [laughter] >> they won't recognize him. stuart: can't go back home, that's a fact. >> did you say home? stuart: what? >> you can't go back home? stuart: my home is the united states of america, okay? [laughter] round of applause, please. [laughter] now this: or netflix paid the star of " the crown" claire foy, less than her costar, matt smith. she played coon elizabeth while

smith -- queen elizabeth. it was not revealed how much smith made, but producers admitted the actress was paid less. they did claim smith earned more because of his fame from the hit show "dr. who." you'd never know it in america -- >> that's not right, phillip! [laughter] stuart: shares of netflix right now are unchanged at 321. and this, it's about to get more expensive -- i can't believe this -- walt disney world resorts, are you kidding me? >> more? stuart: it'll range between 13 $24 for overnight parking. >> wow. a family of four costs you $600. stuart: coming up, "special report" host bret baier. i want his take on the shake-up at the white house. mr. trump says it's not chaos. what does bret say?

we'll also be owned by ethan berman, radio host in san francisco. he calls himself the voice of generation x. i want his take on california turning its back on the president. he'll join us shortliment. ♪ ♪ shortly. ♪ ♪ my mom's pain from moderate to severe rheumatoid arthritis was intense. i wondered if she could do the stuff

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♪ >> i'm nicole petallides with your fox business brief. a close look at toys r us and the $27 billion toy industry. we're looking at toys r us, these companies hasbro and mattel are under pressure because toys r us says they have to close or sell their stores across the country. this as they were able to -- unable to restructure their debt. they're going to be tell selling it off. and what happens to hasbro and mattel? of course, they can still go to target, walmart and amazon. about 10% of revenue actually comes from toys r us. in the meantime, thousands of jobs as toys r us liquidates will be under pressure, as many as 33,000 jobs could be at risk. the ceo said of after a devastating holiday season, they're having to close these stores and exit from the baby products business as well. ♪

stuart: nancy pelosi making her first comments about the pennsylvania special election. listen to what she said about democrat conor lamb. roll tape. >> we're very excited about welcoming a new member from pennsylvania, our newest colleague from pennsylvania, to the caucus. hopefully, that will be very soon. senator lamb's -- conor lamb's upset victory is a tribute to his extraordinary personal record and story and a laser focus on the economic issues that matter most to hard working families.

stuart: i'm sorry, that's the wrong sound bite. nancy pelosi actually said that conor lamb did not run against nancy pelosi. well, we've got a bone to pick with that, because if you take a look at this ad from conor lamb, it's quite clear that he did run against nancy pelosi. roll it. >> my opponent wants you to believe the biggest issue in this campaign is nancy pelosi. it's all a big lie. i've already said on the front page of the newspaper that i don't support nancy pelosi. stuart: okay, i think you got the message there. [laughter] there is a contradiction going on here. let's move on from that. reports of more possible changes in president trump's cabinet. now, those are reports, and they're out there. earlier this hour the president addressed that. he said, look, there's no chaos. roll tape. >> well, the story was very false. i mean, they wrote a story about staff changes today that was very false. we made a wonderful change. i think mike pompeo's going to

be an incredible secretary of state. we have some wonderful ideas. i've gotten to know a lot of people over the last year. you know, i've been in washington for a little bit more than a year where some people have been here for 30, 40 years. i've gotten to know great people. so there'll always be change but very little -- that was a very false story. it was a very exaggerated, a very exaggerated and false story. stuart: all right. let's bring in "special report" host bret baier, with us this morning. good to see you again, sir. >> good morning, stuart. stuart: what do do you make of these rapt rapid-fire changes in the white house? it doesn't appear to have upset the president's agenda. what say you? >> no. i will say that, you know, the president did say that all of the reports about rex tillerson leaving sometime at the beginning of the year were fake news and false and exaggerated as well. eventually that did happen, may have taken longer than january, but in march he is gone. i think that judging by the sourcing at the white house,

there are all kinds of people saying all kinds of things that it's at least being talked about that some of these key positions are going to be changed. it is -- this is the bottom line though, stuart, it is the president's decision. and if he decides this is not the time he's going to change it or this is the time he's going to change it, it's his prerogative. and that, the only hindrance there is if it requires senate approval, that's a scheduling issue that may take some time in this current environment. stuart: he appears to be solidifying his administration around him and his world view and his opinions. >> yeah. i think that's fair. be this is not a team of rivals anymore. it seems like this is, he likes people who are loyal and in step with his thinking. he explained that on the south lawn the other today about his differences with rex tillerson on a host of issues, primarily on iran. but a number of them.

and i think you're going to see more of that. this president seems like he feels emboldened, like he is feeling that he's getting, you know, how he wants to operate, and he did win the election, so he sits at the oval office desk. stuart: i think he likes being at the center of attention. it's -- [laughter] >> you think? stuart: well, yes, i do think that. [laughter] i mean, if you look at the news flow -- and you, obviously, do on a daily basis -- almost every day it's about president trump. it's the trump show. that's what we've got here, bret. >> 100%: i mean, look at every paper. there are at least three stories on the front page that deal with president trump. every news show has president trump leading the way. i agree with you. i think he does like that. he likes to be the center of focus. he's not afraid of chaos per se that's where, you know, as a businessman he operated in that environment. but it is the president who is

pulling the strings, and in the business mr. trump pulling the strings, and that's how he's always done it. stuart: i just wonder how well that went down in pennsylvania. i mean, the president staked himself very much on the line, and the democrat won. that tells me that maybe the country's not all that keen on the trump show. >> well, i think you could read pennsylvania a number of different ways. there is clearly an anti-trump element to democrats' presidentt that was not the push that conor lamb made. conor lamb made a push that was pushing back on health care, siding with unions even though the tariffs in that race came late, both candidates were onboard with what the president wants to do with tariffs. i think that conor lamb is not a candidate that democrats will see at every conservative district throughout the country, but we'll see how many

imitations there are as we get towards november. stuart: oh, yes, we will. it's going to be an exciting time running up to november and an exciting two years before 2020. >> every day's exciting. stuart: we have great jobs, bret. just can't get enough of it. we'll be watching tonight at 6:00. >> we'll see you. stuart: next, i say california doesn't seem to want to be a part of the union. what does the voice of generation x in california have to say about that? he's going to take me on. we'll be back. ♪ ♪ we've been preparing for this day. over the years, paul and i have met regularly with our ameriprise advisor. we plan for everything from retirement to college savings. giving us the ability to add on for an important member of our family.

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stuart: president trump went to califora earlier this week. the state doesn't like him, that's obvious. come on in, ethan bierman, host of kgo-am radio in san san francisco. ethan, are you going to have a go at me? >> stuart, it is great to talk to you. no, look, there are really great things to talk about in california, and especially on your show. the sixth biggest economy in the world is california. you just showered the stock price of -- showered the stock

price of netflix, apple, warner brothers -- stuart: doesn't seem to me that you want to be part of the union. [laughter] >> of course we do. but we have the tenth amendment, right? we have states' rights. we can talk about the ability of the states to do what they want to do as experiments in democracy which is as the founding fathers wanted us to do. and we do. and, yes, of course we're going to have disagreements among the states and tension with the federal government and particularly president trump. stuart: well, what are you up to with illegals? it seems to me that you're going to allow, a, you give them a driver's license and, b, you've got this motor voter registration, so you get the license, and you are rebelling receiverred to vote -- registered to vote. now, i know that illegals are not supposed to register to vote, but there is no sanction on them if they do, and there is no policing of a system which will allow illegals the vote in presidential elections. you, sir, are part of the deal that messes up our presidential federal elections. and we don't like it.

>> well, it -- well, i actually understand those concerns. i share some of your concerns on that. however, up until now we have no evidence of voter fraud occurring. it is still a crime -- stuart: yeah, but i'm looking to the future. [inaudible conversations] look, if you make it easier for illegals to vote -- and, by the way, if they do vote illegally, there is no sanction on them whatsoever. none, zero. so there's no penalty for breaking the law again. >> i actually, i'm not familiar -- i haven't read that statute yet to see exactly what it is, but generally speaking to vote illegally, there is some repercussion. stuart: no, there is not -- >> i will go back and review that statute. the integrity of the election matters. however, we did find that safety on the roads is improved by delivering driver's licenses so they're not as squared so they actually go -- squared so they actually -- scared so they buy the insurance. it's important to those of us who pay for our insurance, and that helps us all out. to bring them out of the shadows

so they're not abused. remember, we had legal cases coming out of states like texas when big companies abuse illegal or undocumented workers and take advantage of them. let's bring them out of the shadows. that's what we're trying to do here. most of them are members of our community. and, yes, by the way, the state sanctuary bill, s.b. 54, still allows our law enforcement to cooperate and coordinate with i.c.e. for violent criminals. so everything that you're talking about i think we have some common ground there, stuart. but i disagree with this take the hard approach. i find it to be immoral, actually. stuart: o.k.. look, ethan, you've got to come back on the show because, you know, i'm running against these hard breaks, so i'm out of time. but, ethan bearman, i want you back at the show. we're going to discuss this at some length. >> sounds great, stuart. stuart: i got my start in san francisco, channel 20. got it. thanks a lot. now, we've got the dow up 200 points, and there'll be more "varney" after this.

. .

stuart: well the plus 200-point rally continues. now we're up 220. pretty close to 25,000 on the dow industrials. i wonder if i could call this, what is his name? kudlow rally. charles payne. it is yours. charles: still the trump rally, stuart. thank you very much. welcome to "cavuto: coast to coast." i'm charles payne in for neil cavuto. stocks are rallying driven by internationals. president trump arriving on capitol hill for the friends of ireland luncheon. blake burman with the latest. blake. reporter: feels like about a week ago since president trump decided to fire his secretary of state move the cia head into that position. that was just tuesday morning. since then there has been even more change here at the white house as the president announced yesterday, that the white house and larry kudlow will soon be