Transcripts For FBC Cavuto Coast To Coast 20240714

The Administration Made a big move on huawei with Edward Lawrence covering it from the white house. Reporter President Trump is not ready to make a deal with china. Every countermove or every move to increase pressure on chinese, are met by countermove by the chinese who have not backed off, or come back to the table, when china had stimulus for its companies and economy, white house announced 90 days for companies to stop selling to huawei. The news heard on mornings with maria. It is another 90 days for the u. S. Telecom companies, some of the rural companies are dependent on huawei. So were giving them a little time to wean themselves off but there are no specific licenses being granted for anything. Okay. Reporter this is relief chinese were looking for, they said u. S. Should allow huawei to continue to do business with u. S. Companies. The they are looking for chinese to reverse course to buy agriculture from the United States. This delay comes as tim cook, the apple ceo, met with empty trump on the mex around for delayed tariffs. If he imposed delayed tariffs on september 15th on 1 a 6 billion worth of imports it would be hard for the company to keep up with their competitor samsung. Apple makes a large part of their products in china. Samsung has a production in south korea which has a trade deal with the u. S. The president said cook made a compelling argument adding delayed tariffs that could affect apple. The president saying he will think about it. Back to you, connell. Connell Edward Lawrence on the north lawn of the white house. Edward talked about the huawei ban being delayed, get 90 more days. A number of tariffs are set to kick in on the 1st of september. We have some of them up on the screen. Theyre not all delayed until the middle of december. Real clear markets editor john tamny is our guest. What do you think is going on here, in terms of how the administration sees things . Edward talked about a meeting with tim cook, about the huawei delay. Delay of tariffs to the 15th. Some might be damaging to consumers are still in place on the 1st of september. Maybe those get delayed too . Which direction are we moving . I think President Trump is happily realizing that the stock market is the most powerful entity on earth, more powerful some say than a Nuclear Weapon and what the stock market is saying is that the only closed economy is the world economy. If we try to damage china with tariffs that limit their ability to sell in the United States, were by definition limiting the ability of u. S. Companies to prosper. Were also shrinking a huge market for u. S. Companies. Apple sells 1 5 of its iphones in china. Boeing sells a quarter of its planes. Boeing, mcdonalds, nike, you cant go after china without going after the u. S. Economy. Connell to your point, more importantly the president for the first time president is acknowledging some of those facts over the last week or so, even if the goals longterm are worth it, you can debate that, no matter what there will be pain short term theyre working through that. In the past there has been denials. In a Perfect World president s would not involve themselves in the very personal act of trade in this case i will defend President Trump this much. I think he is right to want his presidency judged based on the stock market and economy. The stock market reflects the future. The economy is a function of basically government getting out of the way. So President Trump cant have it both ways. If he is going to be judged based on the stock market, investors do not like protectionism. They dont, because protectionism is about shrinking markets. It is about limiting ability of people to specialize. I off that this is happening. Hopefully the administration realizes as it moves from freedom to trade, it will harm very market they rely on. Connell the question how far are they going on both sides . Will there be a deal cut with china in the next few month, which presumably would continue down this road. It helps the economy, certainly helps the stock market. Or, they think they can kind of have it both ways in the sense keep pushing china, maybe take a rick scott idea, you cut taxes somewhere else . Can you thread that needle . Can you have your cake and eat it in terms of fighting a trade war and keeping the economy afloat . My sense President Trump likes the politics of this. That is why he is avoiding a deal. I think any trade deal is absurd but i think he is avoiding one he can go to the electorate, look im getting tough on china. My sense the chinese like that too. My guess they will keep pushing these things back because the tariffs would be so damaging. If i had to guess, some kind of a deal will be struck around october of 2020, which the markets would very much cheer and it would give the president something to run on in the, in the final weeks of the election. Connell we could call it the october surprise but you wouldnt be able to call it that because you predicted it now, august of 2019. Good to see you john, as always. Thanks for having me. Connell markets look good, up 250 on the job. Stimulus coming from overseas, germany, somewhere else and lets bring in joe durant on this. When you think about stimulus, whether the start of, were seeing it already, Central Banks and governments trying to stimulate economies and where that ends up leading us. Where are we in all of this do you think . I think were in the midst of a confusing time. Weve got three big things looming. Number one, we have brexit happening in october. Weve, even without it, germany is in negative recession environment. So there is no deal, that will be dreadful for england and a lot of chaos for europe. It looks like that is increasingly likely. That is one big looming issue in europe. That is driving rate down, which makes our rates comparatively too high, therefore has driven rates lower as well, im not sure, i see a lot of people concerned with recessionary warning. I think more of a reflection were in a small world. What happens to europe affects us too. So our dollardenominated with a dollar keep going up at a higher rate then the negative yields of europe, germany in particular, looks relatively attractive for most retirees not appealing to get 1. 5 on a 10year note. Connell no. The reality is there is uncertainty out there. You have trade tensions. Got what is happening in hong kong. A lot of uncertainty, but this october looming thing will keep rates low in germany and your rob, it will affect rates here tangentially, even if rates dont go down, were a function of the rest of the world. Connell that brings up the point how handle this in the United States . This is moot point. Certainly can anticipate how they will handle our own central bank. They are expected to cut Interest Rates, catch up, for whatever the term is for the rest of the world, is that the long way to go about it. Is there hell to pay long term what do you think . I dont think it will have impact you think, because the 10year note is already 1. 5, 1. 6. So dropping the short rate wont have impact. Why bother . Connell that is your point. Keep it there. Keep it there in case we have a recession. Then the fed can be very aggressive dropping. Connell right. So i understand that we want to, the president wants to encourage more stimulus but it is not going to have the impact that he thinks i believe, because you already seeing the yield curve reflect the rest of the worlds rates. So i would rather defer a little. I think it is priced in now. If it doesnt happen, well have a negative reaction from the market because it is pricing in at least 25, probably, 50. Connell yes. If they dont do something, you will get a, another tantrum, that is not necessarily driven other thing i would say, its august. Markets are light. It is very little trading. So things exaggerates. What happened in the Christmas Holidays last year and again, the frustrating thing is that the markets are flat basically for the last year, even though it has been a good year, it is up 15 . It feels annoying for a year weve gone nowhere. Russell 2000, small caps are doing badly which is concern for me. They should not be doing poorly. Connell environment where unemployment is low and economy in the United States is relatively strong. Right. Connell your point is, even though the markets have done well for the year 2019, over last yearoveryear we should be up what . You would say . I think up somewhere in the 10 range. Connell right. 8 to 12. Connell instead were flat. Given what weve seen you got it. Connell joe. Well see. The most important thing. Dont do anything rash. The markets are doing reasonably well. There is a lot of uncertainty. But as long as youre balanced in a portfolio that is right for you, the bonds declines in rates are offsetting volatility in stocks. You want to have a wellbalanced portfolio. Dont do anything reactive. Because well get through this, but just dont do anything rash. Again the dangerous thing your emotions get tied in. That is when you make mistakes. Connell we saw that we see it last week. Down 800, next thing you come back couple hundred, maybe another 200, 250 today. Down and up. That is the way markets go. Joe, good to see you. Thank you for coming on. Thank you. Connell in a moment well get to hong kong. Both guests mentioned hong kong and protests there. A lot of people out on the streets over the weekend even with the rain coming down. A peaceful protest in hong kong. The pictures youre seeing there yesterday. Well take you live. After the bell, 4 00 p. M. Eastern time, more on headlines. Well see how markets are responding, whether we maintain the 1 gains into the close. Well be right back. You wouldnt accept an incomplete job from anyone else. Why accept it from your allergy pills . Flonase sensimist. Nothing stronger. Nothing gentler. Nothing lasts longer. Flonase sensimist. 24 hour nondrowsy allergy relief but how do i know if im im getting a good deal . I tell truecar my zip and which car i want and truecar shows the range of prices people in my area actually paid for the same car so i know if im getting a great price. This is how car buying was always meant to be. This is truecar. To the wait did frowe just winners. Prouders everyone uses their phone differently. Thats why Xfinity Mobile lets you design your own data. Now you can share it between lines. Mix with unlimited, and switch it up at anytime so you only pay for what you need. Its a different kind of Wireless Network designed to save you money. Save up to 400 a year on your wireless bill. Plus get 250 back when you preorder a new samsung note. Click, call or visit a store today. Connell get to hong kong for a moment. Protesters conducted what is being described as the largest rally since the protests started, avoiding violent clashes though, which is one of the concerns. We were building this up, a big, big weekend, they had rain, a lot of people. Susan li joins us live from hong kong. They did not get a lot of violence. Tell us about the weekend . Reporter that was the good part. Yes a million, at least a million on the streets of hong kong on sunday. That is the biggest march by the way since two million took to the streets in june. We were walking with the crowds. We saw every sector, section of the hong kong population. We saw young people. We saw old people. We saw families. We saw students and professionals. Prodemocracy march continues you see the crowds turned out, so did the rain but this is the first weekend in two month there was no tear gas. Thats right. There were threats of tear gas on saturday. Both sides wanted to tam down confrontations and violence characterized the prodemocracy protests in the 11th straight week. They wanted to present a united front, a united message that hong kong still supports the antigovernment protests. They wanted to do this in a peaceful way. We caught up with one of the public faces of the antigovernment, prodemocracy march. That is the famous hong kong pop star, denise ho. She is supporting the democracy rallies since 2014. She said that hurt her career. She is banned from traveling to china 2014. She lost a lot of endorsements but we asked her why are you doing this . We are fighting for our freedom and our ought ton me, in the face of this erosion of the Chinese Government on our one country two systems model. Reporter now over a million on to the streets of hong kong it should be noted this also shows hong kong is undeterred, not afraid of the china troop build up, 20 miles away here from the chinese city of shenzhen which borders hong kong. We heard President Trump hoping it is not another tianamen, warning beijing on any military intervention. We are not seeing rallies next few days. Maybe over the next 10 days or so. August 31st, and protest leaders are calling for a mass demonstration, hoping another one million will take to the streets. Connell . Connell susan li live for us in hong kong where it is just past midnight. To follow up what susan is talking about, lets get into what happens next. China sent warning to hong kong. It is ready to intervene if need be. Weve seen the troop buildup of Paramilitary Forces in the shenzhen on the border with hong kong. We have hudson institutes Rebecca Heinrichs joining us right now. What odds would you put on the force moving into streets of hong kong at this point . Increasingly optimistic that it is low. It would be disasterous economically for china if they actually did have this bloody crackdown on the hong kongers. Of course only 11 of hong kongers even identify as chinese. Almost two Million People in the streets. Protests are still longlasting. So it, the world is watching it. And now that President Trump said if there was a violent crackdown, it would be difficult to come to a deal with china. So im increasingly optimistic china will not actually use force. Connell that seems to be a key comment, right . From the president. He was criticized for not getting more involved in these protests in hong kong but it does seem, you dont have to read between the lines too much as you say to figure this out, he wants to wait for this to be resolved one way or another before he moves forward with any kind of a china deal. That is what he said last few days. It brings up obviously question, if not military moving in, what is the resolution at this point . You will have, i hope that the Hong Kong Police will not use tear gas again. That there will be some political compromising happening between china, Chinese Government and hong kongers, that can reinstill some sense of autonomy, allow them to have their own, again, you know, two systems one country, give them some sort of reassurance at least in the short term were not going to have these extradition laws, that will take hong kongers from hong kong, move them to the main land of china where it is totalitarian country with no due process. You will have to have political conclusion here. Connell right. At least to reassure hong kongers in the short term. People watching here, why do you think hong kong matters . Is it trade with china and negotiations were having . Obviously a human rights concern. People will have concerns for people in other parts of the world. What matters about people in hong kong and people watching . Hong kong the conflict is microcosm what is going on a larger scale between the United States and thats with hong kong, siding with hong kong and china. Is it free market and due process and freedom that is going to lead the world . Or is it communist totalitarianism which is represented by china. We want to make sure hong kongers are pulled away from china here. That youre not going to have the Chinese Government possible up gobble up hong kong, taiwan, japanese islands in the short term this is a world governed by at least lead by the United States and countries that side with the United States and economic values and system. Connell susan said the next big march planned on the 31st of august. Rebecca heinrichs joins us. This idea of people above profits has come up today. A new message from top ceos in the nation. Well explain what we mean after a quick break, coming right back introducing the allnew chevy silverado. With fifty industryfirsts. Its the strongest, most advanced silverado ever. Connell the markets well get back to in a moment but big move by the Business Roundtable, 180 ceos in the country, they agree maximizing profits in all situations cannot necessarily be the main goal of corporations. What does that mean . First of all jamie dimon was at center of this, Jpmorgan Chase ceo. He is leading a shift for the Business Roundtable and a lot of other ceos are on board. We have former ceo joe grano with us. What do you think of this move . It is not new, new. There are some corporations that follow that thesis. Im delighted jamie dimon is taking the lead because i think he is the best executive we have right now, but a corporation needs to look at it seven as a partnership. You have obviously your clients, your shareholders, your employees. Every major decision has to be fair and equitable for all three. If you cut any deal for one of them then youre stiffing the other two. I would say some ceos and corporations lost sight of all that. If that is only maximizing shareholder value, that is tainted an creates problems. Connell number one, people would say if your goal is to maximize shareholder value, keep it simple, somebody comes in with a social issue, political issue, as it may be, as a ceo, that is for somebody else, keep that outside of work, were focused on shareholder, and you open yourself up. What do you say . Every Major Corporation has a obligation to the community which it resides, that number one should be in every charter. I also believe every corporation, every american should have a philosophy we have a moral obligation to take care of people who cannot take care of themselves. We have to give them the environment to go to work. Given that, i think this socialistic rhetoric is crazy. It will hurt america. Connell right. But i do believe corporations in effect should take on a little bit after social agenda, probably starting with local communities, but stay out of the political fray. Connell that is the hard part. There is a lot of pressure on ceos to do that. Pragmatic effect on this is, one thing to say all the quote, unquote right things but does this matter way a Company Operates each day, what amount of money they make, type of people work there, what do you think will change if you see companies go this way . What i see happening amongst the board of directors, corporations will create a philanthropic unit headed by independents. They will allocate a portion of earnings to the Community Issues and to the social issues that were talking about. And, again, a balance, once you do that, youre taking money out of a shareholders pocket. Connell yeah. On the other hand enhancing your good will and reputation may help you in the long run. That is what i see happening. Connell the idea youre a good guy, maybe they come work for you, helps you get ther people. Before i let you go, i want to get you on something in the news today, has been for the last week, your business in banking, how some of these banks are doing in this environment. Today theyre doing well in terms of their stock prices. Weve spent so much time talking about flattening of the yield curve and how difficult it is to make money and al the rest of it, what is the business of banking . Some say were going into 0708, and others say it is fine. What is your opinion. Were much better than 2007, they have more Tier One Capital within the banks, et cetera. My concern is, well, first of all, as Interest Rates go down, spreads go down and banks have a harder time earning money, both brokerage and commercial banks in terms of their trading positions. If people start refiing their mortgages because rates are coming down, that is called speed. That hurts your inventory positions as well. We have to keep a jaundiced eye on that. My big e issue is, what i call, event risk. Youve got brexit. Youve got north korea. Youve got ukraine. India, pakistan, the trade deal. Any one of those things could cause a vibration within our economy. S p earnings, 40 are dependent on outside events. Were not impervious what is going on in europe or the trade deal. I am optimistic in terms of very slow gdp growth, maybe 1 1 2 to two. You have to keep a jaundiced eye on event risk. Connell youre not in the recession camp, you just say Slower Growth . The market right now is schizophrenic. It is all headlines. Very volatile, depending what they read day, you dont know what will be next. Very true. Connell joe, great to see you. My pleasure. Connell in a moment we get to event risks and situations overseas, including iran. Seized ships left the straight of gibraltar is coming up next. The warning for the United States for them not to be stopped. Cavuto coast to coast back in a moment. Announcer only fidelity offers four zero Expense Ratio index funds directly to investors. And we have zero account fees for brokerage accounts. At fidelity those zeros really add up. Maybe ill win saved by zero connell im sure you heard this question a bunch of times within the last week, whether we see recession before the next election . There is a new survey, 38 of economists see a recession not until after the election. Other side of it 34 see it before. Well figure it out i guess. Tough to get the timing right. That is the prediction business. Democrat candidates hoping for a downturn . Sounds that way. Fox news contributor liz peek with us in studio, democratic strategist, chris hahn and Ken Blackwell joins us in washington did you make anything of the timing of this survey . Almost impossible, well call people wrong. 38 of economists and 100 of democrats are hoping for recession or thinking there will be one. We had an inversion of the yield curve. That is as you well know, subject to lots of different interpretations but it did happen. Around the world yields have plunged to levels weve negative seen before. In denmark today, i read, they are actually paying to you take a mortgage out on your house. This is kind of, the real manifestation, bizarre thing. Connell go to green land to raise money. I think actually its a great idea. Strange things are happening in germany. Last week i talked about germany coming up with a fiscal response. Its a country that can do it. Their deficit runs 60 of gdp. Theyre in a position to boost their economy which would boost the eu so we have to see some of that stuff happen. I think it will. So the answer is, we may or may not see recession. It is by no means a lock. Connell political question, well go to you first, kristin, well get ken involved, one thing for people to say democrats are rooting for the economy to turn south, whatever the case may be, if youre in environment of slowing growth right now, how do you look at it . It opens up an attack line against the president that maybe there the economy was in strength, instead of going after him on tweets and personality, go after him on economic policies . Is that a change of course last few months or weeks from the democrats . I will say as a democrat, im 100 certainly not hoping for recession. Connell not rooting against a country. Im not rooting against the country. I work with number of members of the house rooting for American Workers. I think there is a political calculation here, heading into the election, if the economy hits a downturn right before the election it, could have impact on trump. Im originally from texas. When i go back home talk to people who are Trump Supporters they talk a lot about, you know, i may not like the mannerisms connell but im making a lot of money. But im doing well right now. Connell he is making that argument, ken. In the last rally i guess it was, last couple rallies, hey you may not like me or love me, hate me, but you have to quote, unquote have to vote for me. Is that how the election will be decided here in terms of the economy . Look, connell, a recession is always coming. Connell right. The politics of this is, when folks are giving three cheers for recession, that is problematic. As a former mayor i know how recessions impact middle and lower income families. They are really, really tough, but if you take a look at Consumer Spending, it is still strong. As you know, that accounted for about 2 3 of the Economic Growth, you know, in our economy this president actually got two to 3 trillion off the fence, working in our economy, in accelerated growth and labor participation. So, i think there are strong indicators that were going to push through this, so i would, i think recession will come but it will probably come sometime in 2021. Connell that is the thing. Timing is everything. I want to move to the other side for a moment, politically, talk about Elizabeth Warren. I can already hear some of the responses, that Elizabeth Warren was at a nativeamerican president ial forum in state of iowa, addressing controversy over her claims of her own ancestry and here is what she said. I want to say this, like anyone who has been honest with themselves, i know that i have made mistakes. I am sorry for harm i have caused. I have listened and i have learned a lot. And i am grateful for the many conversations that we have had together. Its a great honor to be able to partner with indian country. That is what i have tried to do as a senator. That is what i promise i will do as president of the United States of america. [cheers and applause] connell back to the panel on this one. Liz peek, you get to go first is it . I give her high marks for showing up there on twitter, there was awful lot of commentary this is pretty ironic place for her to be. She has been dishonest a long time. This is not something she did once or twice. She lied about this consistently to boost her career. People do hold it against her. She is doing well on bunch of other things. I dont think its a deal breaker. Connell i find that part of it, kristin to be very interesting, we assume people will react one way, in this case democratic primary voters to an issue. You say when this came out, i would have thought this issue, because of the honesty that liz brings up would hurt Elizabeth Warrens candidacy more, while she seemed to fade in beginning when it was up in the news, boy she come on here lately. People forgive, forget, dont know. Being honest saying i have made mistakes, i think people like that in candidates. And i think that she has taken, it is interesting to see how many of Bernie Sanderss supporters she is taking. Connell what is going on there . For whatever reason i think bernies time has passed. Connell right. He was the candidate maybe they supported last time. But shes, other voice in the party that kind of takes that, has that same, group of policies. Theyre not that different really. He is onetrick pony. One thing he talks about. She has a million things she talks about. List of accomplishments for all years in office is laughable. Connell other thing, ken, which we know, the world where Elizabeth Warren is nominee, which is not that farfetched, going up in the polls, to kristins point there is no Bernie Sanders there, she we know how donald trump would go after her. Know what exactly President Trump would say about her. I always ask guests that agree with the president , would he licking his chops over matchup with Elizabeth Warren over joe biden . It would be classic, classic socialist rhetoric versus a free market president that actually made the free market work for American Workers and families. At the end of the day, Elizabeth Warren is going to have the albatross of her big lie hanging around her neck. The reason for that is, that shes actually running for the nomination in a party that are the major, producers of identity politics. As a consequence, as opposed to talking about e pluribus unum, from the many, one, she will be saddled with a campaign that is divide and conquer and playing one race and ethnic group against the other. Connell whatever side youre on, if she would avoid it in the primary she will hear it about in the general election on twitter, everywhere else on election day. We appreciate it from all three of you n a moment, the white house signaling more tax cuts may be cutting as a way to offset the damage that is being done by the trade war. Well talk about the merits of that as we continue. Well be right back. Im really into this car, but how do i know if im getting a good deal . I tell truecar my zip and which car i want and truecar shows the range of prices people in my area actually paid for the same car so i know if im getting a great price. This is how car buying was always meant to be. This is truecar. Were looking at it. Tax cuts 2. 0. By the way, senator rick scott of florida, very smart guy, made an interesting idea, proposal on another network last week, he said look, why dont we take the tariffs from the china trade and turn those back to the taxpayers in the form of tax cuts. Connell larry kudlow, saying over the weekend round two of tax cuts talked about a bit of a wrinkle. Charlie gasparino in to talk about some of this. Market rally up 263. But this idea youre fighting this trade war, because that is damaging people, now apparently being admitted by the administration you will cut taxes on the other side . You know, 2 3 of our economy as Ken Blackwell just said is Consumer Spending and one of the problems in the last tax cut, that the individual tax cuts were pretty minor, if you look at it. Some individuals got tax increases you live in the northeast, couldnt deduct state and local taxes. Connell right. I think a tax cut, would counter any of the bad stuff on the trade. Connell would it allow to you keep fighting the trade war . It might. You have to get it through congress. This will not happen. Democrats will not vote for this. I think the president , i think larry knows this in his heart of hearts, knows the easiest way to get the economy back on track, to get the markets stable, to reach some sort of a deal with china, even if it is like a fig leaf of a deal, take this issue off the table for the election. I know that larry knows this. Trust me on this. He knows this is a nowin. The markets hate this. With a president who is, donald trump is not going to campaign on, he is a nice guy, you know what im saying . I think he is a nice guy, a lot of people dont obviously. Donald trump will not campaign he is bringing the country together. It is hard to do that when you, when youre at war every day with various parties. And i dont disagree with some of his rhetoric. Connell you may love me, you may hate me, but i made you money. You need markets to go up for that. You need Economic Growth to stablize at 2 or 3 . You will not get that if you have trade hovering around. If businesses are afraid to invest. They dont know what is coming next. They retrench, maybe dont rehire. Maybe Economic Growth goes 1. 5 going into next years election. Democrats have a talking point, look his crazy trade policies are slowing down the economy. You have to put me in charge. I think that connell sense a shift from not just kudlow but president himself, talking about comments with tim cook after they had dinner . I have to be honest with you i have to do more reporting. I dont understand why Peter Navarro ask running the show on this he is an ideologue. All you have to do is read his books. He is former democrat, liberal democrat. I agree with him china is a menace but you cant throw the baby out with the baath water. That is what he wants to do. Everybody in that administration, who i know, i know most of the economic players, think what Peter Navarro brings to the table is disasterous for the country. This is underreported story the war going on between navarro and just about everybody else. Unfortunately trump listens to navarro on trade. Connell they might have similar instincts if you look at his comment in the past. New stuff on jeffrey epstein. You have done a lot of reporting on it. A story i did for fox business. Com. You should read it. I try to get into his head a little bit based on anecdotes i came across. One of the interesting anecdotes in 2015 shows up to a party in palm beach, a lunch party, with this woman who looked incredibly young. There was questions at the party whether this was legal. Connell this was after after he was out of prison several years. He had, he is wearing these weird slippers, they were black velvet slippers with an embroidered screw on one and. There is lot said about jeffrey epstein, people will say why did he do what he did . How did he think he would get away with this sort of stuff . How did he, what was in his dna . If you look at him, his dna was all about the message on slippers from day one. It was hubris on steroids. And thats the only way you can describe jeffrey epstein. That will come down to. He thought he was above it all. Connell above everyone. If you think about it, his Public Comments including to me personally were very interesting he basically compared to what he did to stealing a bagel. Connell kind of dismissing about it. Remember what he said about tweens and teens . Connell disgusting stuff. He compared what happened to him with what happened to bob kraft. There is no real comparison, particularly in terms of age of women involved. Connell that is a key point. They both receivedder rot make messages, but the crime itself what bob kraft was is parking ticket. Connell a 14yearold. It is disgusting stuff. To your point, dismissive. Hubris on steroids. That will be on his ephithet. Connell foxbusiness. Com for charlies story on all this if youre interested. Thank you, sir. Why a suspicious explosion at a russell missile sight Russian Missile site became even more mysterious. Well beer right back. About vehicle quality. And when they were done, chevy earned more j. D. Power quality awards across cars, trucks and suvs than any other brand over the last four years. So on behalf of chevrolet, i want to say thank you, real people. Youre welcome. Were gonna need a bigger room. At comcast, we didnt build the nations largest gigspeed network just to make businesses run faster. We built it to help them go beyond. Because beyond risk. Welcome to the neighborhood, guys. There is reward. Beyond work and life. Who else could he be . There is the moment. Beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. Take your business beyond. Connell breaking news here in new york. The Police Commissioner in the city of new york moments ago announced that daniel pantaleo, who put a man named eric garner in a chokehold, officer pantaleo has been fired. Jimmy oneil made the announcement. Grand jury did not indict him back on charges. This is when the death of eric garner took place. The Police Department has fired him. The announcement was made by the commissioner. Overseas, Vladmir Putin says there is no risk of increased radiation levels from the explosion that took place at a missile test site on the 8th of august. Two Russian Nuclear monitoring stations reportedly loss contact after that explosion. Arms control Association Executive director Darrell Kimble is our guest now. What is it really going on here . These thoughts, darrell, russians are trying to keep evidence away . What is your sense what happened . Russians are trying to obscure from the world the exact nature of this missile related accident on august 8th, which probably involved a new and exotic propulsion system for a missile theyre trying and failing to develop and the news just in the last few days is that the russians have stopped transmitting data from radiation monitoring stations that are in russia, that are part of Global Network of monitoring stations to detect and deter Nuclear Weapons test explosions. These were established by a 1996 treaty to ban all nuclear test explosions. Russia has number of these stations on their territory, six of which monitor for radiation, and two, they stopped transmitting data about 48 hours after the august 8th accident. Its a curious coincidence. I think it is more than a coincidence. I think probably that the russians are trying to obscure the nature of this sperms to prevent western intelligence agencies from understanding more about the nature of this missile that theyre developing. Connell so it is more of a intelligence issue. Everybody, when they see anything to do with nuclear or, you know, the russians trying to keep information away from us, everybody has chernobyl in the back of their minds, from back in the soviet union days. There is renewed interest with the tv show. People start putting it in that context. You see it as a difficult story here . Well i mean, russia does certainly have a long and sordid history of keeping information about its Nuclear Program secret, especially during the cold war years. Connell yeah. The u. S. Did that too during the cold war years. Here, i think they are probably trying to prevent their public from understanding more about the low level radiation that may have reached areas in russia, closer to this accident, which was in the white sea, to the north of russia. There are also trying probably to prevent us from understanding what kind of Nuclear Material was part of this experiment, which could help u. S. Experts learn more about the missile system. This is not a legitimate reason to turn off these stations. It underscores why this comprehensive Test Ban Treaty system is very useful for all of us. Connell hopefully there is more to come on this story. Darrell kimble, thank you very much. Back to the markets in a moment. Back to the rally, nearly 300 points on the dow. Well be back with whys, what happens next in just a moment. Usaa took care of her car rental, and getting her car towed. All i had to take care of was making sure that my daughter was ok. If i met another veteran, and they were with another insurance company, i would tell them, you need to join usaa because they have better rates, and better service. Were the gomez family. Were the rivera family. Were the kirby family, and we are usaa members for life. Get your Auto Insurance quote today. Connell the stocks today across the globe have been going up on hopes that Central Banks may be stepping in. Could we see a new era ahead . That seems to be the talk. How about Elizabeth Warren, her plan to cancel student debt, cancel out any progress on the economy . Well talk about that and a new warning about that progressive plan. Plus france in the hot seat with its digital tax. Why the big techs say it will have unintended consequences. Hour number two of coast to coast gets started right now. Connell market rally on a monday. Good to be with you. Im Connell Mcshane filling in for neil. Stocks are giving back some of the losses we had last week after that 800 point down day. Its been a steady march back to the upside. Nearly 300 points on the dow at this hour. Investors seem to be at least relatively optimistic for now on the trade front. We will get into that. Also upbeat on the stimulus efforts that might come as the weakening economies have been in the news across the world. The white house saying the world may have its problems, but still, the u. S. Is shining. I dont see a recession. I mean, the world is in a recession right now. And although if you look at china, china is doing very very poorly. Im prepared for everything. I dont think were having a recession. Were doing tremendously well. Our consumers are rich. I gave a tremendous tax cut and theyre loaded up with money. Connell we said thank you, mr. President , because that does set up a debate for our panel as we start the hour and whether the worlds problems end up catching up with us. Dow jones news wires chief editor glenn hall is here. From fox business, the great Deirdre Bolton sitting alongside jack otter. Welcome, all three. Great panel. I can just sit back and relax for the hour with you. We will build origami animals for you. Connell this idea we are on our own, everything is great, all the problems are over there and over here is where all the investment comes, where do you sit on this kind of conversation, at least . Well, this u. S. Economy has been pretty resilient against weakness in other parts of the world on a few occasions over the last ten years. So i think there is some strength there. But we cant go it alone. We are a codependent world of trade. If we see weakness, every time we see a hint of weakness, the market freaks out like it did last week on china tariffs. I think theres still a lot of risk out there to the u. S. Economy. We cant make it by ourselves. Connell good point, because whatever we hear, if its anything, you know, almost every other issue but one headline, even if its a headline we heard two weeks ago on china and trade, it could easily move the markets. We are in a broken jukebox kind of situation. Every time this song plays we have this reaction. To glenns point, if you look at u. S. Consumer activity, it seems like were holding up pretty well. A lost things for sale, fivemonth high four months in a row, i mean, we are doing great, close to record low unemployment but when you have the weakness we are seeing in the eurozone, its not just one or two countries, its the entire zone. If you look at china, remember that 17year low in industrial output . Thats pretty frightening for that region. I think im with you. Okay, fine, we are all right for now but its not like theres a few little cracks. These are Major Regions that are suffering. Eventually we will feel it. Connell absolutely. Just a question of when and how. Connell and to what extent as well, whether its just a slowing or some sort of recession. But on a day like this, you see headlines that oh, okay, global Central Banks can make all this go away and save us all. First, i would point out that while china has its very serious problems, we would kill for 6 growth here. Its not as if we are the only growing economy in the world. Connell doesnt that bring up a point about timing on the trade war, too, for people who think china has it worse than us, which they probably do, that because their economy is only growing slower, not contracting, that they can hang in there, too, pretty much at least for another year or two if they really wanted to. Absolutely, and because its not a democracy so that gives him an edge. Connell theres also that. I will say to your point, im a little bit concerned about the fact that everything we are talking about thats moving the markets is governments, right . Its what do we do about trade relations, are we going to lower Interest Rates, are we going to buy even more bonds because 14 trillion in negative yielding securities isnt enough. I would love to see i wish that the narrative could be more about the fundamentals but its not. [ speaking smimultaneously ] connell this whole trade war was not created by the consumer, right . It brings up the topic what is the interaction between governments. This conversation President Trump had over dinner with tim cook of apple, says cook came in and made what the president called a very compelling argument against tariffs. So that look at apples stock. Last time we checked it was up better than 2. 5 because every person who owns apples like okay, fine, apple just got an exemption. Listen, tim cook is an amazing business leader, right. Hes definitely talking, saying okay, you cant sort of look the other way. My competitor samsung, major competitor, does all their manufacturing in south korea, its not fair, and the president seems to go along with that. I dont know. I think the question is okay, is apple an exception, justifiable exception, what does that mean for other companies. There are many people who say okay, apple deserves that pole position, they deserve special treatment. Connell one thing for tim cook to talk his own book. I was wondering if he was talking on behalf almost as a representative of some small Bicycle Company or some other company that wouldnt have that same access and voice with the president , or is he just speaking for the big guys like apple . I would have loved to have been in that room. They didnt invite me. I suspect, i will be optimistic and think tim cook was making the broad argument. This thing, parts from 43 countries in it. Theres nothing any of us or donald trump or tim cook can do frankly to change that equation. The glass is made in kentucky. Thats awesome. But theres a lot of parts from all over the world. They are going to be made wherever it is the most efficient place to make them or else samsung is going to hurt an american company. I love the fact that tim cook is so wellrespected as you guys pointed out. I think hes probably got Donald Trumps ear. Lets hope donald trump listens to him. They apparently have a pretty good relationship. They meet fairly frequently, given the time constraints on both, from what i understand, even sometimes more than any other tech leader or ceo aniis the white house. They have an open dialogue. Whether thats fair or not is up for debate. Connell there is some pressure on companies, i think, right, to continue to diversify these supply chains and if you are a Small Company thats one thing and you move this small operation you have to cambodia or vietnam or whatever the case may be, but if you are a Large Company like apple, its i guess more complicated. One of the things tim cook brought up which i find interesting is its not only that china can make cheap things but when you are as large and scaledup as apple, they do so skillfully, people have been trained for years and are making a lot of things very well. Sometimes that gets lost in the whole conversation about why not just move it from china to country x. Thats right. Key areas, especially in technology, china has really been pushing over the years. Thats the heart of the i. P. Debate behind the trade tariffs. But youre right, they have skilled work force that can build out quickly and expand to rapidly changing technology needs. Thats harder to just relocate to south america or eastern europe. So there are some areas where the economy isnt able to shift as quickly. There are other areas in this trade war where there will be some production moving. Connell we have already seen some of that. It takes eight months at the minimum and one thing, nobody is going to cry for apple and its margins even though they are shrinking over time. One thing to note, they are facing more competition in china which used to be a big place where Chinese People bought parts but they are deciding maybe 1,000 is a little too much. Im sure tim cook brought this up with donald trump, im getting hit with zte and a lot of other cheaper competitors in asia so please dont give samsung the heads up here. They can scoop us even more. Connell that brings us to another topic in the news. One of the Companies Competing obviously is huawei. It was interesting to see how the administration handled this, just over the course of maybe 24 to 48 hours, now easing up on the restrictions with huawei. If you listened to the president over the weekend, you were thinking maybe they wont give this exemption for another 90 days, then wilbur ross came on with maria this morning, said yeah, they are. Made this announcement. Theres always been this thought about what is huawei . I understand the argument here is to say some companies in the u. S. , particularly in rural areas, are still reliant on huaw huawei. Its cheap. Sorry. Connell but what is huawei . Is it a National Security risk or is it this chip in a trade war . And can it be both . I think it is both. But you have to be very careful. Lets say we decide that they are a National Security risk and im kind of inclined as much as i hate to say it, to say they probably are. They are. They are. Then i would hate to see us give up that chip for economic reasons. If they really will sort of have a back door into our telecom system, which is probably an oversimplification but i dont want to give them that regardless of the but i will say you guys made the point the difficulty of transition iing, u know, whats the word, transitioning to a different country or whatever, supply chain. You cant do that quickly. I think we have to give those rural carriers a long time to figure out is it cisco, is it some other company, then to actually build out those systems with domestic yeah, some of them connell were not going to work with huawei but its not going to be tomorrow. The Rural Communities have come to the u. S. Government and said fine, we dont have to use huawei but you better start subsidizing some of the other choices such as nokia because out in nowheresville or say population with 5,000 people that wants connectivity, its easier for them to just have cheap gear, the uk and germany have said okay, fine, huawei snoops, they are a bunch, you know, what are we going to do, we know that. We have already accounted for that. [ speaking simultaneously ] its a choice, right . Connell we will sell all of our National Data because theyre also saying connell they can be both. They are also not doing nothing presumably. Both the uk and germany said we have put controls, we have our own tech teams putting in controls so we are monitoring whats being stolen. Connell we know what youre stealing. All right. Got to run. We have a lot of other topics in the hour. Busy here. 300 up on the dow. Say it aint joe. Joe biden facing pushback coming from the political left. Some say that could backfire on the democrats. Who that someone is and what that someone says after the break. You wouldnt accept an incomplete job from anyone else. Why accept it from your allergy pills . Flonase sensimist. Nothing stronger. Nothing gentler. Nothing lasts longer. Flonase sensimist. 24 hour nondrowsy allergy relief connell you hear it on the campaign trail but forgiving 1. 6 trillion in student loan debt, could it end up backfiring . A new survey signals that canceling Student Loans would end up hitting the economy. From realclear politics associate editor a. B. Stoddard on that and our panel still here to participate in this discussion. Elizabeth warren talked about it and others, then you wonder if its one of these be careful what we wish for type of deals. Well, i really think that if you look at whats gone on in the polling to this point in the democratic primary, a lot of the proposals coming from Elizabeth Warren, Bernie Sanders and even Kamala Harris of student debt forgiveness, medicare for all, these things have been rejected by the primary voters. Not the general electorate. Actually the voters who are participating in polling in the primary have rejected these ideas because they know they are unrealistic and too expensive. So as we get closer to voting in february, its going to be interesting to see where this race is headed. Joe biden has defended the middle, but is softening in his support because he keeps making misstatements and missteps. People think hes not up to it. The only person who is surging to threaten him in the race is someone who has a totally separate coalition of white educated progressives, not the noncollege white voters, not the africanamerican voters that he earned support from, but a totally different part of the electorate that is for all these proposals that people think are radical. Connell know what i think . Go on. Connell go ahead, finish that last thought. Sorry to jump on you. It will be interesting to see where this heads because its not as if the moderate voters who support joe biden are suddenly going to decide before february that these plans are realistic. Connell the problem, this is where the panel will jump in in a second, im sure, because i find it fascinating and sounds like you do, too, if they dont, say theres this voter out there President Trump keeps talking about at the rally, you may not like me but you have to vote for me because, you know, the economics or whatever the case may be. There are people like that. So if that person decides that they want to consider a democrat, it seems to me theres no other kind of middle of the roadish person for them to think about other than biden thats making any kind of noise. That is really the problem that the democratic establishment is looking at right now. They know that senator Amy Klobuchar is the only moderate or centrist who has made the debate stage and is not going to be the nominee of their party. They look at senator bennet, congressman tim ryan, congressman moulton, governor hickenlooper had to drop out, delaney, none of them have made it to the next debate and they dont have any supporters. The idea is they are left, beyond Elizabeth Warren who could not recalibrate for the general election and pretend to be moderate, is they have to look at people such as beto orourke, senator harris and senator booker, and hope if these voters flee the former Vice President , that they go to one of those candidates. Because the thinking is that warren is connell wall street background, that kind of thing. But doesnt talk that way anymore. I think, jack, maybe you hear this similar. A lot of them just by nature of what we doshgs, a lot of peoplee in are investors, but im thinking of people in suburbs like pennsylvania, whatever business theyre in, those would be the type of voters democrats are going after as much as they may not like donald trump personally, i wonder if they would consider Elizabeth Warren or Bernie Sanders, right . You would end up with another hold your nose election and a couple years ago you held your nose and pulled the lever for either hillary or donald trump. It looks like we could be shaping up for that again. Everyone im sure has seen the bumper stickers, 2020, anyone with a pulse. Something like that. Connell those are real liberal people, i would think. No, no, on the contrary. Connell think those are the middle of the road people . They will be willing to vote for those who are wide open to joe biden who doesnt make gaffes, Michael Bloomberg who is maybe a little more charismatic and ten years younger. I keep wondering if somebody is going to walk into this race and blow it wide open. There clearly is a very wide door. Im with you. [ speaking simultaneously ] theres 19 candidates on the left and then one, joe biden. I think i think there is an opportunity for somebody. The right candidate, to come in. Because for a lot of people, rightly or wrongly, i dont think that joe biden is going to be a compelling vote for every independent or even every democrat out there. Connell Mike Bloomberg decided basically he couldnt run because biden was in there. Well see. I guess we will never know whether it was the right decision. A. B. Stoddard, thank you. In a moment, President Trump calling on hong kong and china to settle these protests that have been happening for so long there. We had another big weekend of them we just wrapped up. How about the risk of the u. S. Stepping in or the Chinese Military getting more involved . We will talk about it when we come back. Introducing the allnew chevy silverado. With fifty industryfirsts. Its the strongest, most advanced silverado ever. Announcer only fidelity offers four zero Expense Ratio index funds directly to investors. And we have zero account fees for brokerage accounts. At fidelity those zeros really add up. Maybe ill win saved by zero no, i think it would be very hard to deal if they do violence. I mean, if its another tiananmen square, i think its a very hard thing to do if theres violence, and you know, im president but thats a little beyond me because i think, you know, i think there would be tremendous Political Sentiment not to do something. Connell President Trump with those words on the odds of a trade deal getting done if things turn even more violent, and the Chinese Military gets involved in hong kong. To blake burman. The panel will react to this in a moment. To blake first at the white house for more details. Reporter we have kind of seen this in the past before from President Trump in this trade war with china, where he takes big issues that are emerging and thrown into the big trade war pot. We saw this with huawei earlier this summer when the president decided to make this a trade issue. Now we are starting to potentially see it again with what is going on in hong kong. You saw the comments there from President Trump over the weekend as he was making his way back over here to the white house. Earlier today, just about an hour ago, the Vice President mike pence made his way over to talk to the detroit economic club, a big gathering there. The Vice President reiterated the president s comments relating to hong kong. Listen. As the president said yesterday, it will be much harder for us to make a deal if something violent happens in hong kong, and i want to assure you, our administration will continue to urge beijing to act in a humanitarian manner and urge china and the demonstrators in hong kong to resolve their differences peaceably. Reporter the Vice President also said the u. S. Will continue to talk with china, though he said that they would pursue a quote unquote, reset in the relationship with china until there is fair and resciprocal trade. Here at the white house later today, we are expecting the president to sit down and meet facetoface with the u. S. Ambassador to china, to get his take, his view with the ambassador in town on everything that is going on in china. Connell . Connell former governor of iowa, back in the u. S. In that state, now obviously in washington. Blake burman on the northern lawn. I will start with you, jack, and work down the table. Blake makes an interesting point. He made the huawei comparison. Whatever you think of whats going on in hong kong, if you look at it from a negotiating point of view and want to buy some time to do what the president is doing, might make some sense. You say lets solve this first because knowing that its probably not going to get solved tomorrow, you got a little more time and maybe you relieve the pressure on the china deal, i dont know. I do think thats a good idea. Theres a lot of moving parts here, first of all it is always dangerous to try to play off the political with the economic. They ought to be kept separate. Second, you have to think about xis position. First of all, he cant lose face here. If the u. S. Especially given our current relationship starts saying you know, move away from hong kong or else, thats actually going to put pressure on him to be tough there. Connell internal pressure. Thats a good point. So you have to really lay off, and this isnt Donald Trumps typical m. O. , but maybe work quietly behind the scenes to see what we can do, certainly get together with the international community. Hong kong is chinas door to the outside. I cant imagine they want to lose that and make it another province. Connell no. The president put up with some criticism from people in his own party, for the most part, lot of conservatives said you better say more about hong kong, quote stand up for freedom but maybe jacks right, you have to be careful here. Im with jack in the sense i think no matter what you say as president of the u. S. , this is just such a fraught situation. I am sure theres part of me that thinks even some leaders in china are disappointed that that stupid extradition bill got out there to begin with, because that was an unforced error on their part, frankly. Connell they are looking for a way out. Thats been tabled and delayed but its still technically out there. I dont know what if its not the Chinese Military or quote unquote, Paramilitary Forces that look like the military, if its not that force moving in from shenzhen to hong kong to keep the peace and get the protests to essentially go away, what is it . What resoflves this . We cant forget hong kong was a wellrespected and Trained Police force of its own. Connell they dealt with these things in the past. They are standing back a little because its mostly peaceful and they are trying not to stir it up and make it worse. Beijing seems to be on the fence about that. I think going back to what President Trump was saying, that was a good move politically for the campaign to tie those two things together and say heres what im doing in trade and heres why it matters on another level. I think it also was a not subtle threat to china, be careful, a lots at stake here. A lot is at stake. A lot of the people who are protesting, its not just students. These are civil servants, like 55yearold lawyers, people who normally are not out in the street. Thats whats different this time than, for example, the umbrella revolution. And the whole world is watching. This is on camera 24 7 somewhere. Connell if you cut a deal with them, next thing you know, something does happen, you cut a trade deal say next week with china, then something horrible happens in hong kong the next week, then you are in a really tough spot. The president knows that. That works both ways. I think the chinese must be seeing the same thing. They do not want another tiananmen square. Connell right. The saying about that was they should have known that in 1989. I understand theres more media and Everything Else but it wasnt like the world wasnt watching. Thats literally what happened. They got that iconic photograph they are still trying to suppress. They dwooont want another one. Connell susan li was on last hour, she said the 31st of august is the next big day to watch. There could be more protests between now and then but thats the next big one they are apparently planning. Saving for a home can be difficult, as everybody knows. Now negative Mortgage Rates dominating the global market, negative Interest Rates in other countries and certainly low Mortgage Rates here. We will talk about whats next for housing when we return. Corey is living with metastatic Breast Cancer, which is Breast Cancer that has spread to other parts of her body. Shes also taking ibrance with an aromatase inhibitor, which is for postmenopausal women or for men with hr her2 metastatic Breast Cancer as the first hormonal based therapy. Ibrance plus letrozole was significantly more effective at delaying disease progression versus letrozole. Patients taking ibrance can develop low white blood cell counts, which may cause serious infections that can lead to death. 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Kristina partsinevelos is following it all today at the new york stock exchange. Reporter we are seeing that optimism, trade optimism is having a lot of investors move their money away from bonds into equities, little bit riskier. Because of that, you have the bond prices that move in the opposite direction of yield, thats pushing up yields, helping banks so a lot of the banks you are seeing with citi, look at that, Goldman Sachs up over 1 . All across the board, up 1 . Another sector thats doing well today, too, is the energy sector. Thats falling off of a trend we saw on friday. Opec putting out their weekly report that output has dropped. We are also seeing saudi arabia production at the lowest rates we have seen in five years so that helps with a little bit even though the price of wti is off the session highs for the day. I want to end on chip makers. I think you have been talking about it but we know the administration has given an extension to u. S. Companies to work for another 90 days with huawei to wean off of it. Thats helping the chip sector and more specifically, another story is nvidia. They signed a deal with microsoft to provide graphics so thats really contributing to that massive 6 rally for that stock. Back to you guys. Connell thank you. Good to see you. We talk all the time about Interest Rates being low in the United States. But the negative Interest Rates overseas have become a story. Negative Mortgage Rates have become a thing, at least, well, in denmark, maybe among other places. Director of Economic Research scholar on where the Housing Market is headed. Its one of these things where you almost have to take a beat and say wait a second, whats going on here. Theres a story market watch had about this bank again in denmark offering a fixed Rate Mortgage, tenyear fixed Rate Mortgage with a negative rate of 0. 5 , which as they describe it, you would still make Monthly Payments but you wouldnt pay back all the money you borrowed. Crazy world i guess. What do you say . Yeah, yeah. It can sound like a crazy mixed up environment but you would have negative Interest Rates. One of the ways it makes sense to me is to think why would a bank be willing to do such a thing, right. The idea here is that they are going to give out this loan and yes, they will get a little less back, but they are hoping that the currency value has changed so the dollars or excuse me, in this case of denmark, the kron, when they are repeat, they will be worth more, right, than the initial loan. So they are getting something out of it. Its not like a totally, you know, mixed up, upside down world, but in a negative rate environment, it is odd enough that it can have a pretty big hit to consumer confidence, even if its good for the individual borrower, its probably hard to get that loan, right. Its almost too good to be true. For many people, it is, right. So if the bank is going to make that kind of bet, they are going to be probably a little bit more sparing with who they give those loans out to. So its not necessarily the dream that it might seem, though the general idea is that this will help also stimulate the growth that they have going on over there. Connell when you read just that line, and say oh, im going to buy a house and dont have to pay back all the money, you think this is great, let me get a house. Yeah. Connell but your point, if this ever happened in the United States, not predicting that it will, lower rates, i guess it, but if this ever happened in the United States, what would it look like for regular people . Yeah. Well, we would be in an incredibly different environment than the one were in now, right. If we looked out the door and you saw negative Interest Rates it would also be the kind of climate where growth would be incredibly slow, maybe because we have a very aging population, and the growth of kind of the work force has really slowed down, or for other means. Maybe a very long and drawnout recession. We would expect deflation to be a part of the picture, right. Right now, we are currently growing where inflation is around target, growth is looking pretty good. Yes, that yield curve upset happened but in many ways, its just one signal of many and maybe that reflects more our own Central Banks activity. It would be a very different economy that we would be in if we were seeing negative Interest Rates so that should really take a bit of the fear factor out of this. This isnt our story and wont be our story for some time yet, if ever. Connell hopefully ever. As you bring up, its the be careful what you wish for that we use that applies here. Thanks for explaining that. We appreciate it. Thanks for coming on. Hope we avoid that situation. There she goes. All right. Big Tech Fighting back against the big techs overseas. We will talk about that next and whether they are getting any help from washington in the process. Well be right back. 900 acres. 48 bales. All before lunch, which we caught last saturday. We earn our scars. We wear our work ethic. We work until the works done. And when it is, a few hours of shuteye to rest up for tomorrow, the day well finally get something done. connell all right. Big tech testifying today against france and the new digital tax there. To Hillary Vaughn at the u. S. Trade reps office with the latest on that. Reporter connell, amazon says that not only are they going to be paying more to france in taxes but will also be investing millions of dollars in working out a system so they can calculate how much tax they actually owe france under this new tax law. Amazons peter hill testified today they have not been collecting a lot of data they need to figure out how much revenue they make from french users. The french tax board tax revenue, not profits, and would apply to 30 companies, many based in the u. S. The tax requires quote, a massive reengineering effort at the company to track and filter revenue by a users geolocation or i. P. Address. Brand new unique tax thats retroactive everything has to happen within a few months and i also remind you, france itself says we would like to take the tax away once the multilateral process is successful. This is a whole lot of work for a temporary measure. Reporter france is not the only country moving towards a digital tax. Spain, britain, italy are also looking at implementing their own. The Tech Industry warns this could have a devastating impact on their Global Business and also set a dangerous precedent. Google saying quote, this is a concern for International Trade and the wider economy of countries follow the model and select specific sectors and groups of Foreign Companies for targeted tax policy. Now, connell, there is also a question of privacy folded into this. A lot of these Companies Say they are not collecting the data that they need in order to assess this tax, which means a lot more data on users could not only be collected but then handed over. Connell interesting angle. Hillary, thank you. Hillary vaughn in washington. What does this european backlash mean for big tech as you see stock prices up today. Start with you, glenn, on the issues in france and you wonder is that kind of a precursor to coming here, and you hear the president saying listen, if anybodys going to tax them, we will handle that and kind of stands up for the big techs, what they are going through in europe. What do you think . Interesting how that dynamic and relationship between President Trump and the tech sector has shifted because its been long calling them sort of supporters of liberals, especially when it comes to News Services like facebook and twitter. In this case, exactly right. Hes saying if you are going to target one of our sectors we will have to retaliate. Hes throwing those tariffs back in the mix. Wasnt it 100 on french wine . 100 tax on french wine. Connell he doesnt drink. It doesnt matter. Connell very good point. Put the fear of god in everybody else. Connell to your point, going down this road again with yet another tariff war and this time it starts with the Tech Companies. I dont know if it ends up there. Not surprisingly, amazon, google and facebook also have a problem with it, as it turns out. Im sure basically all of their lawyers and numerous other law firms are going to be pretty busy. To me it reminds me of what microsoft went through, right, in 19992000, when europe declared them a monopoly and some people have said listen, for europe, they get all the downside, all the negatives of having these tech presences and they get none of the upside of the origin story or the creation bragging rights. Connell i think its always interesting, cavutos split on this. Hes like 5050 but im 100 irish. I always look at europe, im biased, i say why cant they just on the tax structure basis at least, the way they deal with companies, be a little more like ireland, you know, where they have, what is it, 12 , 12. 5 Corporate Tax, not looking for extra taxes to put on something. I cant be too much against the irish with a first name like deirdre but the eu gave ireland some of that money for infrastructure, and ireland was kind of like oh, infrastructure, how about Corporate Tax infrastructure instead of actually infrastructure. There are a lot of europeans who actually even take issue with what the irish did. Connell you are now banned. Do you speak french fluently . Go home, go tell your granny that. Connell she says shes irish but i heard her speak french. Amazon has already slapped a 3 fee on some sellers. So they are getting the money back. They are taking care of it. I do see their issue that the origin story issue is another one but to have these Companies Making a lot of money in their countries and then, i dont know, the cheese maker, the bread baker, they all pay these taxes and the others dont. Its kind of the opposite of where we were 15 years ago, where people said oh, you cant tax amazon because that whole internet thing may never take off if we do that. Now we are the other way. Connell all these many years later, we never 100 figured out how to deal with Internet Companies or how to deal with the internet, period. Funny as itt sounds, its been around for what seems like forever, we never figured it out. I think one of the big challenges you are starting to hear the Tech Companies make clear is if this is the beginning of a country by country tax structure, and each one costs, you know, however many millions of dollars is set up and tracked differently, thats going to eventually become a real burden. Connell france by itself, maybe not a significant one but imagine if that multiplies. Other countries will follow suit if its successful. Have these companies, though, big picture, been able to kind of skirt by a little bit on some of the worst fears that we had on the privacy issue . Because you know, you were down in d. C. Covering some of the hearings. It just seemed like it was such a fever pitch you mean here or in europe . Connell all over the world, whether its going to spread here eventually, or is that still standards for sure in europe. No doubt about it. I mean, in fact, facebook had to cough up some money already and they actually as we know had to cough up some money here. I think youre right, for as much as we talk about this all the time, there is no one formulaic this is how to handle this situation. It is very casebycase. Im not kidding about the lawyers. This is going to keep a lot of people employed and wellemployed for a very long time. Connell they clearly know they are in a different world. For Mark Zuckerberg to come out and make privacy an issue if you are a tech company, are you a media company, are you responsible for your content or are you just the pipes. I think that was facebooks argument before Cambridge Analytica they got away with that argument, we are just the infrastructure, just the pipes, the content we are not particularly responsible for. That Cambridge Analytica action in our 2016 president ial election changed. They are also selling things direct to consumers. They are not Just Technology companies in that way. They are retailers. Connell the question will be how much the companies can control what their fortunes are. They are obviously trying to get out ahead of it, saying we are all for regulation, all for this. Not necessarily higher taxes, certainly. But they want to control their destiny on a lot of these fronts. They do, but keep in mind one interesting thing about Big Companies that get regulated. Think about the tobacco companies. Regulation has been wonderful. Nobody else can get into their business. When the europeans got tougher on google, guess what happened to their market share . It increased. Because the smaller competitors just couldnt meet all those regulations and google was able to. So you never know where its going to go. Amazing point. We see that in every single industry, even hedge funds, right. Its hard for a small hedge fund to get going because they dont have the money to pay for compliance for lawyers. They are putting up barriers to entry. Connell one story, i want to come back and talk about this in a moment, getting a lot of attention to, is this group of business leaders, group of ceos, that came out and changed its mission statement. You say what does that really mean. It gives us something to really talk about, about why companies are in business, what their goals should be once theyre in business and maybe it changes the way long term that they do business. We will talk about it. 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Connell the Business Roundtable today getting a lot of attention, dropping Corporation Shareholder superiority over employees, customers and the community. Jpmorgans jamie dimon leads the charge on that particular group but our panel is here to talk some more about it. Glenn hall, Deirdre Bolton, jack otter been here for the hour. Great stuff. Thanks, guys, for joining us. I said the storys getting a lot of attention because for years, i guess if you read the stories today, they go this goes back to the 80s, you were in it for the shareholders if you were running a company and that was it. It allowed you to kind of ignore the outside world. But times are changing here. What do you make of this . There is a rapid and more rapid than many people expected shift into this idea of embracing social responsibility, sustainability and environmental social and governance issues in general. You are starting to see more and more Companies Realize this is going to be part of a successful business. You have to explain that. It comes back to the purchasing power of the millenial generation, who are really pushing hard with their values first in all that they do, which jobs they choose, where they spend their money and invest. But thats also going back up and you see genx and the baby boomers thinking of legacy effects of their income. Connell this is driven by younger people but its changing the purpose, essentially, of being in business, right . I agree. I agree wholeheartedly. Millenials take a lot of heat collectively for some of their what are deemed odder habits but they have clearly driven as a genxer, i cant jump in or out but its true that, you know, even look at Smaller Companies like toms. You buy a pair of their shoes, they donate a pair. Same with eyeglasses. Consumers are certainly voting with their waltlets. You still have to perform as a company. Connell i just wonder what the risks are putting Something Like this in writing, for an individual ceo, say jamie dimon, this is the way i want to run jpmorgan, okay, great. But if you start to collectively write these things down and change the ethos of how a corporation exists and its not just about the shareholder do you open yourself up to, you know, everybody with a cause now having a way of voicing you have to be kenconsistent. They will have to deal with this. A great example is blackrock, when they started selling an etf that did not own any gun stock. The antigovernment protesters were outside because he didnt go far enough. People will get hit from both sides. I want to put this in historical perspective. Everybody is acting like this is some new thing. It really isnt. Henry ford was blasted for being a socialist because he paid people 5 a day to build the model t. What happened . The workers were far more productive, market share shot up, it was a great business move. Forget about Everything Else. Connell right. I think that is the key to this. Do the companies that do it correctly, they will do better in business because, you know, like Milton Friedman was right to a certain extent but it didnt mean you should pollute, break every law until you get caught. It just meant you had to recognize you were a fiduciary for your shareholders. Taking care of your employees makes sense and will make you a better company. Its not mutually exclusive. Twhaps t thats what the consumer is saying. I expect quality merchandise, i expect profitable and good investment and i expect you to do it sustainably. The risks to your point is what you are getting at with the ceos and their marketing and brand, they have to be consistent. They cant say we stand for this, then go do business with companies that are completely in conflict with that mission statement. Yeah, there is a framework to work within. Connell consumers are aware of what green washing is and they are looking for p. R. Around this thing. This is true in all of marketing now. I think millenials are very savvy to not just green washing but anything that smacks of trying to please them without actually, you know, walking connell the biggest headlines of all, there have always been headlines but recently because the proportions have gotten larger, we are kind of getting at the ceo makes x amount compared to the regular worker, and everybody can come back and make the argument the ceo is more important than the regular worker, which is probably true. Since the 80s, that number has skyrocketed. Connell thats the point. You go back to a Balance Sheet back then, the ceo wasnt making 1,000 times what connell also, gender equality in that pay structure as well is a big issue across the board. Big move from a lot of big names in business today. Kind of interesting to see where it goes from here. Thank you. Summer thoughts. 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Also the white house throwing huawei a lifeline, allowing Chinese Tech Company to buy from american suppliers the next 90 days. Is this enough of an olive branch to get us closer to a trade deal . President trump downplaying talks of recession on his watch. I dont think were having a recession. Were doing tremendously well. Our consumers are rich. Charles he is not alone. Why vast number of u. S. Economists are also on his side. The big news on 2020 recession,