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Well, turning to the campaign trail. It is an election year after all, a shake up with Republican presidential candidate Ben Carson's campaign staff.

Two of his top aides resigning last week ahead of Carson's move to overhaul his operations. Among other changes, Dr. Carson's former senior strategist Ed Brookover has been promoted to Carson's campaign manager and he joins us now.

Good morning to you sir.

ED BROOKOVER, CAMPAIGN MANAGER FOR BEN CARSON: Good morning Sandra, happy new year.

SMITH: All right, so, have a happy new year to you. How do you explain the shake up? Why is it happening?

BROOKOVER: Campaigns always need to be evaluating for the hour, how they're doing, where things are heading. Dr. Carson is always doing that.

He wanted to make a couple of changes in the hierarchy and a couple of folks left. We're still doing the good going --

SMITH: So, how would -- how would you describe the status of Dr. Carson's campaign?

BROOKOVER: Well oiled, well run, ready to move forward toward the Iowa caucuses on February 1st.

SMITH: Is the momentum to the upside or to the downside? The recent polling does show that he's come down a bit. Where are things going?

BROOKOVER: We think we're heading in the upper direction. In fact, today is a very exciting day for the Carson campaign as Dr. Carson will be unveiling the details of his tax plan today.

SMITH: And what are the details of that? Because as we know, it became a very notable point in his campaign when he talked about tithing in his tax plan.

What is this new tax plan? What is the gist of it?

BROOKOVER: It's a tax plan which is simple, fair and transparent for all Americans. It taxes income once and only once. It has a rate of 14 .9 percent for both individuals and corporations.

No deductions, no exemptions.

SMITH: OK, so we're talking about a flat tax at what percent? A 14.9 percent?

BROOKOVER: Correct, 14.9 percent for both individuals and for businesses.

SMITH: So, this is substantially more than his original tax plan was calling for, correct?

BROOKOVER: No, I don't think so. When Dr. Carson was talking about tithes, and he was talking more about the concept of applying the same amount to each individual.

And we believe that this plan does that and meets the standards that Dr. Carson had been stepping all along.

SMITH: So, Ed, Dr. Carson had said in many recent interviews that he had grown frustrated over the inability of his campaign to get his message across. What is it that he's so frustrated about right now?

BROOKOVER: I believe Dr. Carson wants to get more of his policies out more quickly with more detail and with more intensity.

And that's just what we're starting here this morning with the unveiling of his new tax plan.

MCCULLOUGH: Do you think that he needs to just simplify the complex? Obviously the man is a genius.

Can he do that and simplify that this by my scorecard, this has got to be the best tax plan I've seen certainly at the individual level.

BROOKOVER: Well, we appreciate that quick compliment greatly, and we hope that as people use dynamic scoring as we move forward, everyone will see the benefits of this plan.

Dr. Carson has a wonderful ability to communicate directly to the average voter. The voters that are looking at him closely in the Iowa caucuses, and we look forward to getting his views and values out more to them.

MCDOWELL: What is he -- Ed, it's Dagen McDowell. What is he doing with deductions in this flat tax plan?

BROOKOVER: There are no deductions on the individual side at all.

MCCULLOUGH: Really?

MCDOWELL: That's pretty intellectually honest, does it not? If you get rid of the mortgages deduction, even the charitable deduction.

But does that really -- but that -- you're going to -- are you going to have a hard time winning people over with that? Say people in the real estate industry.

(LAUGHTER)

That's one of the reasons they're still there after so many years.

BROOKOVER: Well, it may be. But you know, Dr. Carson does not believe that the tax plan should be picking winners and losers.

He also believes that after an analysis, he'll show that individuals who do own their own homes will still come out ahead under his tax plan.

KELLY: Ed, it's Kevin Kelly. My question to you is, where does the doctor stand on capital gains taxes? We've seen Hillary come out with some pretty interesting policies and how she wants to shape that.

As well as you're talking about only taxing income once, does that also include dividends, because corporations already paid taxes on the dividends.

BROOKOVER: Yes, under Dr. Carson's plan, we will not tax capital gains, dividends or interest at the personal level --

KELLY: That's awesome --

BROOKOVER: We tax income once and only once.

SMITH: So, Ed, if I could just -- if I could change the subject a little bit to national security which is -- which is defining -- is now defining this election.

A notable turning point in Dr. Carson's campaign was in the aftermath of the San Bernardino attacks. He was criticized for not having the experience as far as foreign policy was concerned.

His followers were concerned about his knowledge and his being able to protect the country. Where does he stand on that? What's his response to that?

BROOKOVER: Well, we view that criticism as a little bit unfair. Maybe more than a little bit even. You gain foreign policy experience by traveling abroad.

Dr. Carson has visited 58 countries, by meeting with leaders of foreign nations, he's done that, and by putting out policies and programs that are easily understandable by the people.

His 7-step approach to how to take on ISIS. ISIS is the most detailed approach we've seen today.

SMITH: Who does Dr. Carson see as his biggest competitor?

BROOKOVER: We think our biggest competitor is getting our message out to the voters. We need to re-examine our campaign and make sure it's against ourselves and our ability to make sure that his values, his views, his vision is getting out there right now.

SMITH: All right, any specific strategy that he has for the next GOP debate?

BROOKOVER: For the next debate, first, we're pleased to be working with Fox Business for the next debate, and he just wants to make sure he gets his first share of time to give his views to the voters.

SMITH: All right, all right, well, Ed Brookover, thanks for joining us this morning.

BROOKOVER: Thanks for having me, Sandra.

SMITH: All right, and we are only ten days away from that next Republican presidential debate.

It is the first one of the new year and you can only catch it here on the Fox Business Network on Thursday, January 14th, you're not going to want to miss a minute of it.

All right, well, coming up, oil, another market mover today as rising tensions between Saudi Arabia and Iran intensify.

We head back to the CME Group for the oil trade next.

(COMMERCIAL BREAK)

SMITH: Futures aren't the only thing moving today, crude making a slight comeback on news that major oil producers Saudi Arabia has cutoff ties with Iran.

We're also watching gold on the move, don't say that very often, Phil Flynn at the CME Group. Phil, gold has not --

PHIL FLYNN, CHICAGO MERCANTILE EXCHANGE GROUP: Yes --

SMITH: Been a big mover, it certainly wasn't in 2015, will it be this year?

FLYNN: It could be. Especially if they continue to have the tensions, you know, go up across the globe.

You know, we're talking about Saudi Arabia, Bahrain, Iran, even India and Syria. All of these geopolitical tension could give gold a boost.

We're seeing a news here to buying. We just were up $15 right now on gold, 1,074.80 of 14.60, so a new surge in buying.

But look at oil, too. Oil was up over a $1, came back almost even on today, we're up about a half a dollar right now on this tension.

And the thing you have to remember, Sandra, is that when you have tension in OPEC, in some of the world's biggest oil producers, even if, you know, the Shell producers continue to produce, that type of oil is difficult to replace if there's any disruption. Back to you.

SMITH: Hey Phil, I know that a lot of the options pit still remain and are still open on the floor there. Treasury options --

FLYNN: Yes --

SMITH: I mean, what are you seeing as far as volume and activity this morning --

FLYNN: Yes --

SMITH: Considering the selloff in the equity market?

FLYNN: Looks like the year is getting off to a good start. Can you hear that noise --

SMITH: Yes --

FLYNN: Behind me, Sandra? --

SMITH: Yes --

FLYNN: This is a -- the euro, dollar options. You're seeing a lot of fear buying in these call options in case something bad happens. The ten-year note options, they've been rocking this morning, too.

A lot that I've heard down here in sometime.

SMITH: Is that the year at all, options behind you that are here?

FLYNN: That is right behind me --

SMITH: Yes --

FLYNN: Right, and these guys right now, of course, when there's fear, you know, a lot of buying comes into these pits. A lot of call options just in case something big happens.

MCCULLOUGH: Yes --

SMITH: Right, Phil Flynn, thank you. I have to point out, not the Europe --

FLYNN: Thank you --

SMITH: Currency --

MCCULLOUGH: Yes --

SMITH: Of the Chicago floor trader, I got -- but it's euro, dollar --

MCCULLOUGH: Yes --

SMITH: Options, all right. Crude oil, gold, commodities, big movers this morning -- I don't know, gold -- this is the -- could this be an interesting year for the precious metal?

KELLY: It might be, it might be. But people need to put their cash to work because they're really underfunded, there's a thrill for yield.

And we're still in that market environment now, I mean, Fed raised 25 basis points, really didn't do anything.

But the -- what's really coming out of the pits is that $40 a barrel were under, even puts the most efficient oil producers in a bind.

So, if we stay here for a long time, we're going to see reverberations of that price action in the second half of next year. And we keep talking about what kind of an industrial recession.

This is going to play through on that. Two pretty significant levels, we see the geopolitical risk has been pulled out of a barrel of oil when Turkey shot down -- shot down a Russian plane, oil barely even moved 2 percent.

Look at the price action this morning when you have 2 of the heavyweights of Saudi Arabia --

SMITH: Yes --

KELLY: And Iran go at it. You know, right here, lower for longer --

MCDOWELL: Quickly, "Star Wars" action figures are better investments than gold.

(LAUGHTER)

MCCULLOUGH: Gold up by the way. You know, if you want to really trade gold, look at Futures and options contracts, look at where the crowd leans.

Last week, they got negative. So, there's over 14,000 neg short contracts in gold. That alone gets the crowd to have to cover or go the other way.

So, again, watch the neg positioning, you can get this data, it's readily available, it's how the pro's trade Futures and options.

SMITH: All right --

KELLY: It's a (INAUDIBLE) rock --

SMITH: OK, well, there it is, at 1,077 of troy ounce. All right, we're watching it for you. Meanwhile, as Saudi Arabia cuts off ties with Iran, we'll speak to the man formerly in charge of U.S. forces in the Middle East during the Iraq war.

Former chief of U.S. Central Command, General Anthony Zinni is here next.

(COMMERCIAL BREAK)

SMITH: U.S. Futures deep in the red ahead of the first trading day of the new year, which is an hour away from the opening bell.

Dow Futures off 285 points -- Nasdaq leading the losses this morning with a nearly 2 percent loss. Jo Ling Kent is here with the breakdown of your favorite tech stocks and what to expect for them in the year ahead.

Jo, good morning.

LING KENT: Yes, Sandra, rough start for some of the tech names you know. Tesla down 5 percent of the free market after announcing it shipped just 208 Model X SUV's in the fourth quarter, and on the first full quarter, it was available. It seems like there's ongoing supply issues that the falcon doors that are slowing down the manufacturing of the SUV. The company now says it is ramped up to 238 units per week. But some of good news on tax for the Model X, more than 17,000 vehicles were delivered in the last three months, that's up 75 percent year over year. But there is another fire that is not helping their cause. Norwegian TV showed a Model X caught fire burned to a crisp on New Year's Day while plugged into a super charger. Tesla says no one's injured and they are investigating.

We're also watching Netflix on the biggest losers in the S&P 500 right down -- now, down more than 4 percent. That stock, which is one of the best performers on the S&P 500, last year, has been downgraded by Robert W. Baird, that brokerage reducing its price target to $115 all the way down from 128. This is Russian paper -- as a Russian newspaper announces, Netflix is coming to Russia later this month as part of a larger global expansion.

We are also watching Yahoo! as Marissa Mayer, the CEO, had to do a very rough year, dropping 3.4 percent in the pre-market, along with that broader selloff. Mayer's futures, of course, very uncertain, shareholders continuing to put that pressure on the board after the company did a total 180, going back on its plan to spin off the Alibaba stakes, now considering a selling off the entire core business, 2016 could be a really hard year for Yahoo! Sandra.

SMITH: All right. Thank you very much, Jo. We'll be watching for it. In addition to the news out of China this morning, stocks and (inaudible) are reacting to the news that Saudi Arabia and Bahrain are cutting ties with Iran, joining us now on a Fox Business exclusive, Retired United States Marine Corps General and former head of U.S. Central Command, General Anthony Zinni, welcome to you sir. It's an honor to have you this morning, but we'd -- first, love to get your reaction to this news.

ANTHONY ZINNI, RETIRED GENERAL UNITED STATES MARINE CORPS: Well, good morning, Sandra. I think the news is really concerning. If this were to escalate in any major way, we have the potential for a hot war between Iran and Saudi Arabia, which could close the gulf. Obviously, the access to energy, freedom of navigation, the implications for us and all of that, much like the old Iran-Iraq war in the '80s, could be, I think, deeply concerning for those who worry about the economy and stability in the region. Also, this will distract from the war on ISIS. The Saudis are deeply concerned about what's going on in Yemen, the Houthis and the oppositions are supported by Iran. They will have internal problems because the least provinces and Bahrain and other places have major Shia populations that are demonstrating now and obviously, that unrest could cause internal problems. So for those reasons a potential hot war, the distraction from ISIS, the internal problems that are allies in the region could have, this thing has to be walked back very carefully.

SMITH: I mean, general, the criticism of this administration is that they haven't had a plan, that the president has laid -- has not laid forward a specific plan to defeat ISIS. Based on what you know.

ZINNI: I think that's correct. I think the rhetoric talks about defeat, but the action on the ground looks more like a strategy of containment and slow attrition and that's a high risk strategy because it allows ISIS to continue to radicalize. To recruit, to gain more terrain, to obviously conduct attacks in Europe and elsewhere. If we really were about defeat, we would mobilize NATO, our NATO allies and us, we've been attacked. Article 5 would be invoked and we would take stronger action. Even to commit on ground forces, we would put pressure and give support to this new coalition that the Saudis are putting together for them to get more involved. And I think with our participation and our support, they would. And this would match what's going on in Iraq now, with the Iraqi military, along with the Kurds to finally beginning to show some strength, but there's a long way to go in that area. But in my mind, we could crush them in a short period if we made the commitment to defeat.

SMITH: General, what would it take.

ZINNI: The actions on the ground don't match the rhetoric out of the White House.

SMITH: I'm sorry to interrupt you, but what would it take.

ZINNI: Sure.

SMITH: As far as ground forces are concern -- U.S. ground forces. What kind of numbers are you talking about that it would take to implement that kind of action?

ZINNI: Well, I don't think takes many on our part. Let say, a couple of brigades will I would want NATO participation. Paris has been attacked. Belgium has problems. The U.K. is concerned. Obviously, we've had attacks in Canada in the past, of course, San Bernardino and the potential here. So this is not just our fight. And I think if we were to commit, at least participate on the ground, provides support, you see the Iraqis and the Kurds beginning to stand up. The Kurds need more support, more weapons, better weapons, higher capacity weapons, and I think the pressure on this newly formed coalition of Arab forces with our support, if they saw us committed on the ground, this could be a three-pronged attack on ISIS. Go back to the first gulf war, desert storm. We followed the pal doctrine, overwhelming force. By the time we launched the attack, it only took hours to defeat Saddam's army. It would take a short period of time to give ISIS a major defeat.

SMITH: Wow.

ZINNI: You might not destroy them in all throughout their ability to hit any place in the world, but you would destroy their core, their base, a significant number of forces, and I think discourage many recruits form wanting to join a loser.

SMITH: General, another big conversation as we work our way into an election near here is defense spending. What changes should we see made there in order to strengthen our military and we were still facing $18 trillion deficit in this country? What do we do as far as military spending?

ZINNI: Well, I think, first of all, you need a strategy, which we don't have, which prioritizes where our interests are in the world. Where threats are? Where are like on national interests lie? What kind of military we need? We obviously can't be all things to all people. We can't be the policemen of the world, so we have to pick and choose, and that ought to drive the kind of military we fund. We can't continue to be globally responsible for everything that goes on in the world. I think another part of this though, besides military spending is forming viable coalitions. Look, NATO needs to be restructured, you know. Its mission needs to be cleaned up and clarified. Its commitment, you know, we've increased it from 16 to 28 countries, but the military capacity hasn't increased. So, better burden sharing, better cooperation, better support of other militaries of our allies are part and parcel of this, too. We're reducing our military far below what our strategy requires.

SMITH: Right.

ZINNI: But we can do this in a smart way by building these partnerships and by committing to a military that's carefully designed to meet the needs where our interests lie and where the threats lie.

SMITH: General, I won't -- we've got to leave it there, but I won't ask you to get too political or tell us your candidate, but are the presidential candidates having the right conversation? Are you hearing the right debate take place as far as the conversation to combat and defeat ISIS?

ZINNI: The answer, the short answer is, no. I have not heard anyone really talk about an effective, viable strategy as yet. If you want to defeat ISIS, it takes a strong commitment. I haven't -- I haven't heard that at all. And one that's reasonable and one that understands how we build coalition and alliances. And you know, and I would just also say part of the discussion ought to be do these candidates know what it means to be commander-in-chief? I haven't seen that discussion and I have my doubts across the board on both sides of the aisle.

SMITH: Noted. General Anthony Zinni, thank you for joining us this morning. Honor to have you.

ZINNI: Thank you, Sandra.

SMITH: All right, coming up. Market is getting hit hard on the first day of trading in 2016, we have the details. Behind me is (inaudible) next. But first, breaking news, General Motors is investing $500 million in on demand ride service Lyft. GM will also gain a seat on Lyft's board. This latest investment valued the Uber rival at $5 1/2 billion, compared to Uber's 70 billion. We'll be right back with that.

(COMMERCIAL BREAK)

SMITH: Welcome back, U.S. futures deep in the red, ahead of the first day of trading in the New Year. Look at that, it selloff 291 points and the Dow, 33 point drop in S&P. Chinese market's (inaudible) to selloff. Earlier this morning, European markets also moving sharply to the down side. The Dax in Germany up more than 4 percent, we continue to watch that for you.

Meanwhile, President Obama expected to use executive action to tighten gun control laws. Cheryl Casone is following all the latest out of this story for us today, Cheryl, good morning.

CHERYL CASONE, FBN FINANCIAL CONTRIBUTOR: That's right Sandra, good morning. Big story this week, the president's move would strengthen background checks required for gun purchases. He is also set to hold a townhall meeting on Thursday in Virginia to discuss on reducing gun violence, begin exact executive action on that story.

The New Year brings new laws for riding, hoverboards in the state of California, as the wake of a slew of recent accidents. Riders would have to wear a helmet and stay in the bike lane on roads no more at the 35 miles per hour, that's as fast as they can go, the new law also preventing children who are under 16 from using the boards at all. Anybody caught violating any of these new rules faces a fine about up to $250, and finally this, Donald Trump launching the first television ad of his campaign.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The politicians can pretend it's something else, but Donald Trump calls it radical Islamic terrorism, that's why he's calling for a temporary shutdown of Muslims entering the United States until we could figure out what's going on. He'll quickly cut the head off ISIS and get their oil. And he'll stop illegal immigration by building a wall on our southern border that Mexico will pay for.

DONALD TRUMP, PRESIDENTIAL CANDIDATE: We will make America great again.

(APPLAUSE)

(END VIDEO CLIP)

CASONE: As promised, Sandra, that's the entire 30-second clip. The Trump campaign saying it will spend at least $2 million per week on TV ads, with about 1 million going to Iowa and another million going to the state of New Hampshire. It's all about the primary Sandra, all about getting the votes, back to you.

SMITH: We are (inaudible) it's time, it's go time. All right, Cheryl, thank you. Over, a less than an hour away from the opening bell on Wall Street and we're looking at a sharp selloff this morning even though we are often the worst levels of the session. Earlier, if you are watching, we had 330 plus selloff in the Dow. Well, is all of this a sign of things to come in the New Year? Joining us now is UBS Wealth Management Chief Investment Strategist Mike Ryan, he is going to take us through this and tell us calmly how we should all handle our investments in the New Year. It's a bit of a rocky start -- starts to a New Year, to selloff like this (inaudible).

MIKE RYAN, CHIEF INVESTMENT STRATEGIST: It is a New Years hangover. You think about some of the things we are concerned about towards the end of 2015, that is how the growth dynamics when the emerging markets, specifically (inaudible) would play out. What the effects would be in the develop world. We're seeing that play out in the first part of 2016 as well. I do want to be careful here, Sandra because while we have the economic data overnight was soft. We have to remember that there's a balance of economic data overall shows that while the outward focus parts of the Chinese economy are slowing, what you see is actually domestic economy continues do pretty well, certainly the service side help up. So again, I think this it's a bit of an overreaction to a single data point.

SMITH: It's kind of the words that we heard from John Brady, RJO at the CME group in Chicago, a little bit earlier. But the focus is now gonna be on U.S. data, you say, and we've got a jobs report at the end of the week.

RYAN: I think there are two critical pieces of data this week among others. I think the PMI report, which we get today is gonna give us some sense of whether to slow down. And manufacturing is truly global and widespread, or whether it really was something that was related to China. And then second to your point is gonna be about the employment report. There are concerns, though, that if the employment report shows weakness, then there's a concern, of course, that maybe the Fed had moved too quickly when they raised rates in December. And we'll be back into this should they or shouldn't they have debate with regard to Fed policy.

SMITH: OK, so, your preferred market you say is the Eurozone, which is interesting because there's definitely a theme developing already in the New Year, if I can say that. It seems to me a lot of people like Europe right now. It's taking a big hit this morning.

RYAN: Well, here is the interesting thing, I think the reason that Europe sold off was largely, in sympathy with the China selloff, but also concerns about this ongoing conflict with Iran and Saudi Arabia now, and the potential for that broadening into something bigger. I think what you focus, though, on what's happening on the ground in the Eurozone, it's pretty encouraging. While we're talking about the witness in the Chinese PMI's, we have to sell the Eurozone PMI's for 20 (inaudible). Suggest it was now that the Eurozone economy is finally beginning to gain some traction after this incredibly sluggish period where they simply were faced with so many challenges with regard to the viability of the Eurozone in this country.

SMITH: So it is safe to say that you would, and all of from the substantive panel, because I think that -- I think these guys disagree with you, but is it safe that you would buy a dip like this to heading to a new year?

RYAN: Again, let's see how the next couple of days pan out. I wouldn't necessarily be buying today. I think that the selloff is a bit exaggerated and it's a reaction to a single data point. Our views were that the global economy, although it's still uneven, we think the expansion continues. And we think the earnings outlook, well, it's certainly not spectacular, I think it's going to be OK in 2016.

KEVIN KELLY, RECON CAPITAL PARTNERS CIO: My question to you is over the Eurozone, we're seeing monetary policies being very easy, there's a stimulus going on. But last year, we didn't see multiples expand. I mean, we look at the German Dax, NASDAQ down off 4 percent right now. But it's got leading companies worldwide and globally, you've got Bayer there versus Johnson & Johnson here. You've got Daimler over there versus Ford here. There are great multiples and value to be had, but we didn't see them expand last year. Can we see that expand this year? What is it going to take for them to come off their low evaluations?

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