Shifted toward a less grad all approach to overall policy normalization. The fed expects inflation to remain somewhat below the 2 target near term. The fed reiterated support for gradual increase in the federal funds rate. Participants believe in 2018 there will a bit of a slowdown in the economy, revising projected gdp to 1. 8 from 2. 2 . Unemployment, expected to being strong, 3. 95 to 4. 5 . One of the things fed is watching, obviously lower inflation. Several participants expressed concern 2 longer run inflation objective might have slowed. Recent so theness in inflation might persist. Theyre claiming drop on decline of Wireless Telephone Services and prescription drugs. There is also concern among the fed and Business Community about lack of direction from the federal government on spending. They said activity in couple had slowed from high level. Some contacts in the Automobile Industry reported declines in production. They appeared to recently abated somewhat. There is uncertainty about changes in fiscal and other government policies. Some contacted small irfirms believe their Capital Spending plans had not been appreciably affected. There is concern that the federal government fiscal spending is going to contract. That that is going to hit the bottom line. Cheryl . Cheryl adam, i want to point out you are giving highlights of the minutes, were looking at the major market averages there is not a lot of reaction. Investors are shaking this off. If we had a more hawkish tone from the fed do you would have seen the market selloff. The dollar flatenned out a little bit. Treasury yields fallen a little bit. What we didnt get was the hawkish tone from them. The key i read, several prefer to announce a start to the process in couple months. But others say no, we need to wait, assess what is happening with inflation. Inflation although the fed may not admit it is not where they want it to be and that is a bit of a problem. Cheryl maybe unwinding of the Balance Sheet we may begin to see that in september. That is what i heard but i want to confirm that with you . Reporter there is push by several of the participants to announce the process. Or thes are objecting. Cheryl what to do with 4. 5 trillion on the Balance Sheet if youre on the fed. Adam, thank you for the highlights on that. We want to stay on that news. I want to bring in jim bianco, jason rotman, managing partner at lido isle advisors and Nicole Petallides on the floor of the new york stock exchange. Nicole, Market Participants. Are what we heard from the fed is fed communicating. That has been. Markets not reacting in kneejerk reaction at all. Pretty much got what they wanted to hear. What was interesting how much the fed, with their language, so careful as to not miss the lead investors in the market overall. Reinvestment policy could be misinterpreted. Does that mean they have a less gradual approach to raising rates . That might speaking the markets. So that is what theyre being so careful with, is the language in particular. It is very interesting. Overall we still have the same kind of market. Tech is leading. Energy is under pressure and oil and gold really havent budged too much of the moves they had prior to the fed minutes. Cheryl . Cheryl jim, i was looking at the threeyear treasurys. At one point hitting session lows today. Threeyear was a little bit of pressure overall on treasurys. Nothing really dramatic, jim. That kind of tells me this is muted reaction. Yeah, definitely is. I think what people need to understand is, that the fed talking about reducing its Balance Sheet from 4. 5 trillion to two trillion, no central bank ever done this anywhere. This is giant leap into the unknown. They are correct to say that this could be misinterpreted. And there is a little bit of cold feet there. Reason youre not seeing market react to it, this is the markets view all along. The fed had been talking a lot more aggressively about reducing their Balance Sheet. Market has been thinking, no youre not. Now the fed is saying maybe we wont. Maybe well drag this out into 17. Maybe we will go much slower, especially with low inflation. This is one of my things argued about forever, that the fed caves to market wishes time and again. Seems like what it is happening again. Theyre caving to the market saying you will go slower than you think. Cheryl to that point, jason, you kind of hear that in the language. When you hear discussions going on, just to reiterate our viewers, this was the june 13th, 14th meeting. This always been with the paper in september they were always replacing mortgages, they were always replacing treasurys, they kept that Balance Sheet in place, and many would argue, this is when the real economy is really going to come forth, when the fed starts to back away. You know, you cant even look at that as a vacuum. That is is the first coming out. More than ever, especially last eight years obviously politicallyspeaking the fed is very closely tied with tax policy, you know, jobs growth, via the new president supposed policies and in support of that. So the fed is not just the fed anymore. The fed is closely aligned with what the new administration is doing. So the fed intelligently being very, very cautious, because when are these supposed tax cuts going to happen . Can trump continue supposedly supporting job growth . The fed is doing the right thing, being cautious at the same time, the fact they will not buy any new bonds in ridiculously gargantuan way they have been, that leads me to believe Interest Rates no matter what will trend higher. Cheryl nicole too, we had this discussion so many times, the fact that yeah, obviously the Market Participants you have one eye on washington and one eye on Monetary Policy but seems lately, nicole, it is more about washington political moves or inaction in d. C. That is affecting the markets. Washington never had such a correlation to the markets like it has the last year or so, so that is no doubt. As we get lines from washington gives jitters to the markets we do see that, geopolitical things as well. As we delve into the minutes, quickly i say getting rid of that 4. 5 trillion Balance Sheet slowly not reinvesting bonds and like, participants in fomc meetings that would be lead to path of rate increases. In fact a few officials who supported the june rate increase are less comfortable with future rate paths because of soft inflation. So getting the sense here that, you have a soft inflation number, youre not really seeing huge inflation, why raise rates . This quote talks about spinning off the Balance Sheet. That is not a reason to raise rates. They may be getting colder feet raising on the path they had planned. Cheryl certainly because they have got to factor in inflation which really hasnt shown itself. I want to say the dow transports are heading to session high moments ago. This is the dow transports particularly hitting session high. Alltime high. Cheryl correct myself. Nicole, thank you very much. Jim, jason, as well, appreciate your perspective on this. Were getting notes from the fed market. Not really reacting. Were down 18, flat, about 2 00 p. M. Eastern time. That has been kind of the trading range weve been in all day today. Lack of volatility, that is good considering where the markets had been closing, all record highs weve seen. Money is doing well today. Turn to todays other top story weve been following for you. Kim jongun you vowing he will not stop north korea puts back Nuclear Capability and ability to strike anywhere in the u. S. They launched it is first Intercontinental Ballistic Missile yesterday. That missile, want to be clear today, could reach alaska. President trump expressing frustration with the chinese on this issue. He quote, said, trade between nine and north klee grew almost 40 in the first quarter. So much for china working with us but we had to give it a try. Ashley webster with the story. Honeymoon between President Trump and chinese premier xi is officially over. By the way the latest figures do show trade has increased between china and north korea. The hopes that chinese economic sanctions could help cush the Nuclear Ambitions of the north korea, those hopes faded away. This icbm launch by north korea certainly in defiance of a ban by the u. N. Security council. The u. N. Security council by the way, at request of the u. S. Will meet this afternoon on this issue behind closed doors. Now the pentagon says the launch which youre seeing here lasted 37 minutes. That is the longest flight time for any Ballistic Missile north korea launched by the way. A pentagon spokesman saying today, the u. S. Didnt shoot down this missile after it was launched even though they watched preparations for the launch as well because they deemed it did not pose a threat to north america or allies. But Officials Say this launch did threaten airliners that may have been flying over head and shipping in the sea of japan because north korea didnt coordinate with anyone. The pentagon by the way saying this missile is not one they have seen before. Is it a gamechanger . It very well could be. Meantime we know President Trump heading to europe. He has the g20 meeting and the north korean situation certainly will be a key topic for world leaders. China and russia already calling on north korea to suspend its Ballistic Missile program in exchange for the u. S. And south korea to stop their military exercises. Now china and russia say they also oppose any regime change in north korea. So you can imagine that meeting between President Trump and chinese premiere xi will be a very interesting one. They got along famously as we know in maralago down in florida. I think the topic and tone will be a little different. Cheryl between the chinese president , i cant wait for that meeting between President Trump and vladmir putin. Fly on the wall. Cheryl i wish. Ashley, thank you very much. Talk about wanting to be that fly on the wall. Here is the bigger question for all of us now, what should the u. S. Do . I want to bring in fox news strategic analyst Lieutenant Colonel ralph peters, quite the voice on this. How do we handle north korea . How do we stop this situation from escalating . Well, at this point, cheryl, it is almost impossible to stop it from escalating. Indeed it may be impossible. But the first thing we must do is to stop deluding ourselves, stop lying to ourselves. Weve seen president clinton, president bush, president obama, initially President Trump believing the myth that china can be cajoled or strong of had armed help us with north korea. China will never do anything to destablize the north korean regime. It will not do anything significant beyond token gestures to stop the nuclear or Missile Program in north korea. Why . Because china does not see north korea as a grave problem. It sees it as an asset, a valuable ally in peacetime and wartime. In peacetime, north korea keeps us obsessed and focused on that, while china does pretty much what it wants elsewhere. In wartime, north korea would he tie down initially an enormous slice of our military assets in the pacific theater. So why on earth would china destablize a regime that could lead to reunification, et cetera . It is just not going to happen. What can we do . Its, it is our default position to believe that there is always a good solution if only we can find it. I fear, and i do, i dont like to say this but i fear, i dread that this is going to end in a military conflict because we can not allow north korea, that regime to have icbms with matable Nuclear Warheads that can reach the united states. Not hawaii and not alaska, not seattle, not portland, not kansas. Cheryl with a mobile launcher as well makes it harder to track where they launch from and makes it harder for our officials. Lets talk about the secretary of state rex tillerson. He has already been very vocal about this issue. He seems to be playing a key role. Read you what he said about statement about north korea. Were seeing u. N. As well meeting today, he said testing an icbm represents a new escalation to the threat to the u. S. Our allies, partners, region and the world. We intend to enact stronger measures to hold north korea accountable. You seem to be saying that could be accountable from a military perspective, not just sanctions which frankly have not worked . They have not worked because china undercuts them. Now, i know some viewers will think, peters, he is military guy, of course he wants a military solution. No, i do not want a military solution. This would not be a matter of surgical strikes. Cheryl, at this point north korea has had so much time to deep dig tunnels, go underground to disperse facilities. As you point out mobile launchers are harder to track, hide in railway tunnels, road tunnels. This would require a Major Military effort and many strikes if we want to have any hope saving seoul, the capital of north korea on the dmz border. Cheryl south koreans, japanese, us, were talking but china has to get involved. China has to do something and maybe President Trump can get the ball rolling at the g20. Colonel peters, were out of time, thank you so much for your perspective on this. Thank you, cheryl. Cheryl lets move on folks. We want to talk about this, at home anyway, gas prices at decade lows. One carmaker is instead betting the future is in electric. Get this a major car manufacturer is abandoning the Combustion Engine all together, saying all models from 2019 onward are all electric or completely hybrid. We have the intel. Well talk about that particular carmaker coming up next. So we need tablets installed. With the menu app ready to roll. In 12 weeks. Yeah. The world of fast food is being changed by faster networks. Data, applications, customer experience. Which is why comcast business delivers Consistent Network Performance and speed across all your locations. Fast connections everywhere. Thats how you outmaneuver. So new touch screens. And biometrics. In 574 branches. All done by. Yesterday. Banks arent just undergoing a face lift. Theyre undergoing a transformation. A data fueled, security driven shift in applications and customer experience. Which is why comcast business delivers Consistent Network Performance and speed across all your locations. Hello, mr. Deets. Every Branch Running like headquarters. Thats how you outmaneuver. Cheryl gas prices hit a 12year low, President Trump tweeting, gas prices, are the lowest in the u. S. In over 10 years. I would like to see them go even lower. So that was the president s tweet, but this is ironic because, automaker volvo is announcing plans to ditch gasonly powered cars by 2019, two years away. Theyre only going to offer electric or hybrid vehicles after that. Gerri willis has got, i think a fascinating story today on this. Two years. Cheryl, this is a fascinating story. Luxury carmaker volvo stop making cars run only by internal Combustion Engine by 2019. All volvos after that will be fully electric or hybrid. This makes volvo the first major automaker to abandon the technology that fired up industry more than 100 years, starting back with the model t way back in 1908. The compani sees yo had this to say. This is about the customer. They increasely demand electrified cars. You can pick whatever electrified volvo you wish. He rerated the companys plan to sell one million electric and hybrids by 2025. The volvo announced plans to announce five new electric hybrid vehicles between 2019 and 2025. The irony of this announcement as gas prices hit 12 year lows. Some automakers say theyre making a calculation that ever strict Emissions Regulations will make it more cost effectively to produce hybrids rather than gasfired cars. That is part of what is going on in the ceo suite. Volvo owned by a chinese insvelte firm, Geely Holding company after sold by ford in 1919. Under the chinese, sales have prospered with sales growing 6 ion as some automakers in the u. S. Announced Monthly Sales declines. Speculation is high, cheryl, that volvo will attempt to run that is as a public stock offering. That strategy announced today could make it more popular with investors. Well have to wait and see. Cheryl i love the fact that it is cheaper to drive in general. Well, isnt that a good thing, right . Good for consumers. Cheryl great for the country and economy. Gerri, thank you very much. Youre welcome. Cheryl here is something you want to think about as we go to break. A lot of folks are out there wondering today if democrats have lost their minds over a proposed bill to investigate President Trumps Mental Fitness. Im not making this up. Democrats have taken trump hatred to entirely new level. Is it crazy . Well debate it coming up next. But they say. If you love something set it free. See you around, giulia cheryl democrats on the hill are drafting a bill calling into question President Trumps Mental Fitness to hold office. The bill, which has nearly two dozen cosponsors, would establish a commission to carry out a quote, medical examination of the president , to determine whether the president is mentally or physically unable to discharge the powers and duties of the office. Joining me now, democratic strategist