MARIA-02
Carson for HUD; Tough Decisions Ahead; Prepaid Overdraft Changes; North
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Andrew Napolitano, Jared Max >
Government; Protests; Supreme Court; Sports; Italy; Fires; Death >
(COMMERCIAL BREAK)
MARIA BARTIROMO, FBN ANCHOR: Good Monday morning everybody. Thanks so much for being with us. I'm Maria Bartiromo. We're happy you're here. It is Monday, December 5.
Your top stories right now at 7:00 a.m. on the East Coast.
President-Elect Donald Trump's cabinet has a new member. Dr. Ben Carson will be nominated to lead the Department of Housing and Urban Development. This, breaking this morning. One role not yet filled, Secretary of State. The search for America's top diplomat is widening this morning to include the following: ExxonMobil CEO Rex Tillerson, former Utah governor Jon Huntsman -- all on the list.
(BEGIN VIDEO CLIP)
KELLYANNE CONWAY, TRUMP SENIOR ADVISER: (inaudible) -- because at the moment there are no -- there's not a finalist only because he will interview with additional candidates early this week. More than four, but, you know, who knows how many finalists there will be. And it's a big decision and nobody should rush through it.
(END VIDEO CLIP)
BARTIROMO: The very latest on the presidential transition coming up this morning.
Meanwhile protesters are claiming victory in North Dakota today. The Army Corps of Engineers denying a government permit on the Dakota Access Pipeline. House Speaker Paul Ryan is slamming the decision. He's calling it big government decision-making at its worst. We have got the latest details here.
And another populist victory to report in Europe -- Italians rejecting political reform. And the country's prime minister Matteo Renzi resigning.
The European markets are rallying on the news but concerns are out there about the health of the Italian banking system. The banks in Europe are down this morning -- that's keeping any gains in checks. Check out Germany -- the DAX index up 1.5 percent as investors speculate that money will leave Italy and find a home in Germany.
We are watching the currency markets. The euro is now higher against the dollar. This has been a volatile situation here. The dollar was soaring, the euro was down. It has completely reversed course and there you see at 1.07 on the dollar.
The futures meanwhile in the U.S. taking a cue from European markets -- we're looking at a big rally this morning at the opening of trading. The Dow is set to open at another all-time high of 19,245, up half a percent right now. Nasdaq up 25 points, better one-half of 1 percent.
Different story in Asia overnight -- markets lower across the board there. Shanghai down one and a quarter percent; Nikkei average in Japan down almost 1 percent.
Meanwhile the search for victims continues in the tragic Oakland warehouse fire. At least 33 bodies have been recovered, some of them teenagers. The latest on the investigation into this deadly inferno.
Overdraft rules now coming to prepaid debit cards -- what the government is doing to protect customers, coming up.
And McDonald's gears up for more changes from table service to cage-free eggs -- what the CEO says is coming to bring people into McD restaurants.
All those stories coming up this morning. And joining me to talk about it Fox Business Network's Dagen McDowell; Recon Capital chief investment officer Kevin Kelly; and 32 Advisers CEO and Fox Business contributor Robert Wolf.
Contributor -- new title.
ROBERT WOLF, FBN CONTRIBUTOR: Raise the roof.
DAGEN MCDOWELL, FBN HOST: Contributor --
WOLF: That's right. You do one of these.
KEVIN KELLY, RECON CAPITAL: Yes.
MCDOWELL: No, no, no. We're doing it.
BARTIROMO: We're doing it. It's like, you know, raising the roof for you, yes. Big news this morning.
WOLF: Well, maybe my favorite Fox followers will now quit trolling me for a day or two.
BARTIROMO: Haven't done Twitter this morning?
WOLF: No.
BARTIROMO: Not yet.
WOLF: It's been pretty positive. Actually Bob Carey took all the --
KELLY: He took the heat.
BARTIROMO: Yes, he is getting slammed on Twitter this morning for his commentary around Trump because of the threat of a 35 percent tariff, taking the call with the Taiwanese president and then, of course, this -- what went on with Europe, you guys, rejection.
WOLF: You know, the truth is Trump has an incredible humor when he goes into office with business tax reform. He can go between, you know, repatriation and taxes and those who want to leave and looking at inversions and a whole smorgasbord of stuff because we haven't had tax reform in a long, long time. And everyone wants it.
And I think as opposed to his tactical approach, if you waited for business tax reform he could actually negotiate with companies that want to leave in different ways and then he can leave it to the states.
BARTIROMO: Yes.
KELLY: And I think the strongest point you're making is it is a bipartisan issue so he can get it done. It's just how he gets it done and the execution of it.
BARTIROMO: We'll see. We'll see.
MCDOWELL: You start hammering companies and talking about 35 percent tariffs --
BARTIROMO: Yes.
MCDOWELL: -- again the markets reacting positively to the idea of a broad policy that is pro-business. When you start anti-business and start sounding like you're going to use the humor and play whack-a-mole with American companies, the markets will react in all --
(CROSSTALK)
BARTIROMO: You're right.
WOLF: I don't think he's (inaudible) the repatriation with a tax holiday like Bush did. So I think he has a little ability to maneuver there.
BARTIROMO: Well, we're going to talk about that this morning.
And we've got one of the biggest stewards of global companies business here with us. The president of the New York Stock Exchange is here. Tom Farley will weigh in on all of this. Plus Fox News senior judicial analyst Judge Andrew Napolitano is here with former vice presidential nominee Joe Liebermann and former Republican presidential candidate Jon Huntsman; by the way, Huntsman on that list of potential secretary of state. So join us for a fascinating conversation with all of the above, coming up.
First up, the search is widening. President-Elect Trump has expanded his list for the key cabinet position of secretary of state. Names such as ExxonMobil CEO Rex Tillerson, former Utah governor Jon Huntsman and Admiral James Stavridis are also being floated.
Here is Reince Priebus on the selection process.
(BEGIN VIDEO CLIP)
REINCE PRIEBUS, DONALD TRUMP CHIEF OF STAFF: That one is just taking a little bit longer. And I think it's just fine. And everything doesn't have to happen all at once but he's taking his time, making a smart decision. And we will see where that goes.
(END VIDEO CLIP)
BARTIROMO: Let's bring in New York Congressman Chris Collins right now, a member of the Trump transition executive committee. Congressman Collins, it's good to see you.
REP. CHRIS COLLINS (R), NEW YORK: Yes, good morning -- Maria.
BARTIROMO: We have a lot to talk to you about. We definitely want to get to this 35 percent and whether or not he is overstepping by threatening companies.
But first give us your take on the growing list of secretary of state names out there.
COLLINS: Well, I think again, this is one of the more important cabinet positions, not to say they're not all important. And a few of us -- Newt Gingrich, myself, and Kellyanne Conway -- were all pretty vocal when it came to our comments about former governor, Mitt Romney.
And you know, the supporters of Donald Trump would prefer it to be someone other than former Governor Romney. He was certainly on the shortlist.
So for whatever reason President-Election Trump has decided to expand the list -- I think it's good. It's a critical position. So at this point he will be the one making the decision but as we saw with Ben Carson, that doesn't mean the process is not moving along quickly.
More than half of the cabinet is now filled. Eight out of the 15 positions are way, way ahead of anyone's anticipated schedule.
BARTIROMO: Wow.
COLLINS: So great progress, other names to come forward and he's certainly taking his time and we should all respect that on the secretary of state.
BARTIROMO: Dagen.
MCDOWELL: The phone call that Donald Trump took from the leader of Taiwan, again breaking protocol going back to 1979 -- that was intentional, was it not? That wasn't a mistake.
COLLINS: Well, I wouldn't call it a mistake. To me Donald Trump, you know, as he was not politically correct at all times I don't expect he's going to pay much attention to protocol. You know, this is a time when he needs to get things done. That's what a CEO does. He took a call from the president of Taiwan; obviously he knew the call was coming in. I don't see anything wrong with that.
And if others, you know, get all caught up in their underwear over it that's just them being hung up on this protocol.
Donald Trump is going to be a different kind of president, speaking to the public directly through his tweets and the press has to get over that. I think America finds it just very refreshing that Donald Trump in his gut is going to do what he wants.
He took a congratulatory call. He's not currently the president. I think the one-China policy -- it's something we've have for a long time. And taking the phone from the president of Taiwan, that doesn't change that at all.
BARTIROMO: Are you all caught up in your underwear about this?
COLLINS: No.
MCDOWELL: Or as we say down south, don't get your pants in a knot.
BARTIROMO: Don't get your pants in a knot.
Wolf: Congressman Collins, you've been incredibly loyal. And you know, as someone who's on the Hillary side watching you on TV, you are incredibly a good speaker and surrogate --
COLLINS: Well, thank you.
WOLF: -- for President-Elect Trump. Not easy to go against you. But the question I have is, you know, you took a shot obviously at Governor Romney because really of his lack of loyalty and the things he said going in. But now when you see this new group of Senator Manchin, Governor Huntsman, and these people, I mean you know, none of them were from Trump either.
And so the secretary of state has to be the right person. Loyalty matters but also, you know, at the end of the date we want to make sure what the most important role for the most part other than President and Vice President is the secretary of state.
Who would you like to see outside of, you know, loyalist Giuliani on the rest of the list?
COLLINS: Well, I'm not going to give my opinion. That's for the President-Elect to make. But what I would point out about former Governor Romney. He was out there searching for the cameras and the microphone in a way to slam President-Elect Trump at every turn. So others who may not have supported him, that's very different than -- I mean Nikki Haley was not someone that supported him but, you know, she wasn't like Mitt Romney just looking for every minute to get in front of a microphone to slam something he may --
BARTIROMO: Right.
WOLF: Yes.
COLLINS: -- have said the day before.
BARTIROMO: Yes. Real quick -- Kevin.
KELLY: Congressman, can you give some color about the strengths that Ben Carson is going to bring as the newest cabinet member?
COLLINS: Well, you know, what they say in a lot of cases, they joke around, they say it doesn't take a brain surgeon to be secretary of HUD and here we've got one.
BARTIROMO: That's a good one -- a very good one.
COLLINS: Very smart guy.
BARTIROMO: Congressman, real quick. Is President-Elect Trump overstepping with his 35 percent threat?
COLLINS: No, he's not. I've been with him on this all along. We have to do what it takes to get manufacturing jobs back. We have to make stuff here in America, the six to one job multiplier on manufacturing jobs. We have to have manufacturing jobs. We don't have a level playing field.
If that's what it takes, the fact is we're net importer of about $800 billion a year. Those jobs need to come back. Not everyone is going to be a STEM scientist. Not everyone is going to be an attorney or a physician. We need jobs, good jobs and those are manufacturing jobs.
BARTIROMO: Yes.
COLLINS: We've lost our manufacturing base, we have to get it back to level the playing field with China and Mexico to take care --
(CROSSTALK)
BARTIROMO: Do you worry about the implication of 35 percent tax? I mean aren't prices for goods going to go up? Isn't it going to make things much more expensive? Isn't it going to impact profitability of corporations?
COLLINS: Well, it's going to result in some inflation, inflation that we need so we can pay down our $20 trillion of debt in cheaper dollars down the road. If we can create six jobs for every manufacturing job that comes back, the tax revenue that's going to come from that, people are going to come back into the work force. Absent manufacturing jobs, where is this country going?
So I believe we have to bring it back. We have to level the playing field. I'm a big proponent, you know, whether you call it a tariff or whatever it is. We've got to level the playing field. And I'm all for it.
BARTIROMO: All right. We'll leave it there. Congressman -- good to see you. Thanks so much, sir.
COLLINS: Good to be with you Maria.
BARTIROMO: Chris Collins joining us there.
Coming up another populist victory in Europe -- Italians rejected political reform yesterday. The country's prime minister is now resigning. What it means for the European Union, coming up.
Then drowning out the competition -- Disney holding its number one spot at the box office this weekend. We'll tell you about it.
Stay with us.
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BARTIROMO: 33 people dead in the tragic warehouse fire in Oakland, California. Crews are saying that they're less than halfway through the debris, still looking for bodies.
Cheryl Casone with the details now -- Cheryl.
CHERYL CASONE, FBN CORRESPONDENT: And families are suffering as they wait -- Maria. And Oakland Mayor Libby Shaaf says that a criminal investigation is now underway. This place ignited during late night dance party Friday night. More bodies expected to be found as people who attended the party are still missing. Authorities confirming some of those victims were teenagers.
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SGT. RAY KELLY, ALAMEDA COUNTY SHERIFF'S OFFICE SPOKESMAN: We have now started to recover and identify the victims who are minors. We do have some children in the ages of 17 years old possibly younger, not sure.
(END VIDEO CLIP)
CASONE: The warehouse was home to an artist community and investigators say they have several days of work ahead of them. Family and friends are desperately waiting for answers this morning.
Well, we continue to follow a developing story out of Italy. Italian Prime Minister Matteo Renzi resigned after voters rejected constitutional changes backed by the government. Renzi's reforms would've overhauled Italy's legislature to make it easier to pass laws and make the country more competitive. Renzi conceded defeat after his proposal lost by a margin of about 60 percent to 40 percent. The populist Five-Star Movement led by comic Beppe Grillo says it's now ready to govern Italy.
Well, nearly two million pounds of ready-to-eat chicken products have been recalled. The National Steak and Poultry Company says some of its ready- to-eat chicken may have been undercooked and that raises concerns about bacteria. There has been no reports of illness so far but the recall has been classified as class one by the U.S. Department of Agriculture. That's the most critical, it means there is a reasonable probability that anybody that's eats the product can seriously get sick.
And at the box office over the weekend, more demand for "Moana".
(BEGIN VIDEO CLIP)
DWAYNE JOHNSON, ACTOR: Hero of men.
AULI'I CRAVALHO, ACTOR: What?
JOHNSON: It's actually Maui, shape-shifter demigod of the wind and sea, hero of men.
I interrupted from the top -- hero of men. Go.
(END VIDEO CLIP)
CASONE: Dwayne "The Rock" Johnson, by the way. The family-friendly film came in first, pulled in $28.4 million; it was followed by "Fantastic Beasts and Where to Find Them" which earned $18.5; "Arrival", "Allied", and "Doctor Strange" rounded out the top five at the box office -- Maria.
If snow and rain comes into the East Coast, you're probably going to see more demand for movies.
Back to you.
BARTIROMO: Yes. Thanks -- Cheryl.
Coming up next, all good things must come to an end -- right. Will the Trump market rally last past inauguration day? We're checking markets next.
And then an announcement coming soon. How the President-Elect's pick for Supreme Court could shift the balance of power. We're on it, coming up.
Back in a minute.
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BARTIROMO: Welcome back.
Markets are continuing their record run since last month's election. Take a look. Dow Industrials this morning set to open at another all-time high. Following the Italian no-vote, investors are showing optimism over President-Elect Donald Trump's policy priorities and cabinet picks.
Joining me right now with more is the president of the New York Stock Exchange. NYSE president Tom Farley with us this morning. Tom -- good to see you.
TOM FARLEY, NYSE PRESIDENT: Good morning. Thanks for having me on.
BARTIROMO: Thank you so much for joining us.
FARLEY: My pleasure.
BARTIROMO: So first on this Trump rally -- what the heck do you think is powering this? And do you think that it continues? I mean early on I was expecting the market to rally because of the policy of lower taxes and rollback of regulations is that still the underpinning of this market?
FARLEY: Yes. You stole my thunder -- Maria. I think it's exactly that. I think the thing that surprised on election night was not only the Trump victory -- and a fairly overwhelming victory, at least with respect to the Electoral College. But also what happened in the Senate --
BARTIROMO: Yes.
FRLEY: -- and so when we all woke up the next morning this idea of hey taxes could go from 35, maybe not all the way to 20, but down considerably and regulations could be rolled back are what really jolted the market and continue to this day.
BARTIROMO: So this is a real big positive. The President-Elect has been very vocal about his idea that rolling back regulations is even more important than lowering taxes because this is a pro growth agenda.
But in a tweet yesterday he says this. "There would be a 35 percent tax on businesses that leave the United States." Now, you're the steward of an institution that is home to so many global companies that have business overseas, what is your take on this 35 percent tariff threat?
FARLEY: Well, Donald has said a lot of things that ultimately end up rolling back or watering down. We have 500 -- around about 500 consumer companies listed on the New York Stock Exchange. This idea of massive tariffs on imports clearly will not be welcome.
BARTIROMO: Right.
FARLEY: But when you look at the tax plan as a whole, it's more welcome. Again, taking taxes from 35 percent to 20 percent, being able to immediately write-off depreciation -- there is still a sense of optimism that some of these more concerning ideas with respect to trade won't come to fruition. If they do and they continue to march down the track, I think you're going to see a different view from the markets.
BARTIROMO: Well, that's the thing. I mean when we had Wilbur Ross on last week, he basically said this is a tool and we have a lot of tools and this is one tool to use to get companies to give America a second look. You agree that it's just a threat -- it's a serious threat though.
I mean what happens with a 35 percent tariff? Does that mean products and go higher. Does that mean profits get, you know, pressured?
FARLEY: For the last two or three years, the number one issue on the minds of CEOs -- when I talk to CEOs, hey, if you are judge and jury and you could change one thing about the environment for operating, it's corporate taxes writ large. So the fact that we're having a conversation about should we have the highest taxes of OECD nations here in the United States. It is important.
We're going to have to work through the details. We have 500 consumer companies --
BARTIROMO: Yes.
FARLEY: -- as I said and so clearly any tax with respect to imports and exports will be looked at very carefully. But I'm an optimist, I think the markets are optimistic. The markets are up round about 10 percent this year as we sit here this morning. They're indicated up. We may yet again have all-time highs. And so for the moment we are at a good place.
BARTIROMO: Isn't it interesting, Tom -- you and I sat here earlier in the year. 2016 began with the worst beginning for the stock market of any year. First two weeks of January '16, I was doing my -- I was working on my year-ender just last week -- and I started to look back. And I remembered, wow, that first two weeks of January '16 we were down $2 trillion in market value. And now we are were ending the year at record highs.
FARLEY: Yes, I feel like it's groundhog day, a little bit for me which gives me some concern. I came into this year at the New York Stock Exchange with lots of IPOs lined up. This was going to be a big year. It's going to be just like 2014 when we had 130 IPOs, we raised $80 billion. And those first two weeks of the year really leveled the IPO calendar for the first six months.
BARTIROMO: It was horrible.
FARLEY: Right.
BARTIROMO: So what does '17 look like? One area of the market that obviously has been slow are IPOs. We want to look at that right now because you've got this year will be the slowest number of IPOs since 2012 when 90 issues priced, this is from Rich Peterson at S&P Capital IQ. Do you think things pick up in '17?
FARLEY: So, I've been wrong before. I should preface it including on your show about this. It looks very good.
BARTIROMO: It does.
FARLEY: Yes, absolutely. Again that's the price at the all-time high. Volatility is low and stable. Interest rates are low and stable. Our pipeline for great IPOs is significant. And by the way, even though this year it was slow and last year it was relatively slow we have some really great IPOs, media IPOs. We had Twilio is an exciting tech IPO.
BARTIROMO: Yes, that was a good one.
FARLEY: U.S. food which is, you know, more of a commercial consumer/industrial billion dollar plus IPO and many others. So the IPO market is not dead and hasn't been dead the last two years and there is reason for considerable optimism. And when the IPO market's healthy that's a great thing because that's more money to create jobs, to invest in our great country.
BARTIROMO: Everybody thought it was a new day when the New York Stock Exchange got Twitter. The New York Stock Exchange got Twitter, The New York Stock Exchange is getting all the technology deals. Are you going to get Snapchat?
FARLEY: So, I'm not going to comment on any particular company. Everybody like to talk about the sexy companies and Snap is no different than any other -- AirBNB, Uber.
I will say we are getting the2 really great tech companies. In fact if you look over that two year period we talked about, I think it's largest 25 IPOs -- every single one has been on the New York Stock Exchange.
BARTIROMO: What about Facebook?
FARLEY: That was beyond two years ago.
BARTIROMO: Ok. Ok.
FARLEY: And obviously I don't wish ill on a (inaudible) that was a very difficult IPO. Since that day, again, we've won nearly every large IPO in 25 out of 25 or 24 out of 24 over the last two years.
BARTIROMO: You must be schmoozing though the management of Snap right now, and Uber.
FARLEY: In general, as a part of my job description --
BARTIROMO: You're a huge master.
FARLEY: You know my jog. I don't refer to it as a schmooze master but I spent a lot of time with leaders of business but I'm not going to comment on any particular one.
BARTIROMO: Do you think it strange that technology has not been part of this huge rally? Financials are up, healthcare is up -- all these groups are up on the Trump victory except tech.
FARLEY: I do. I do think it's strange. In fact, I've actually kind of asked around to some of the smart people. Kind of like when I sat down in your set today saying why is Italy up this morning. Sometimes when I don't understand it, it bothers me a little bit. And that's how I feel about tech because the common narrative about well, Donald's views on immigration could somehow hurt tech.
I mean I just think this tech industry in the United States particularly what's going on in the West Coast is nearly indefatigable. And I would not have thought that we would see such difficult trading.
BARTIROMO: Maybe it's just -- I mean as simple as they've got to sell something to buy something else.
FARLEY: Yes.
BARTIROMO: And maybe that is the answer for Europe today. Germany is up one and a half percent. Do you think money would conceivable come out of Italy and go into Germany on this no referendum.
FARLEY: It could. Well, I mean it's the best theory I've heard. But quite frankly I'm surprised, similar to tech being down, I'm surprised by the rally in Italy overnight. But you're right. The easiest theory here in the U.S. well I have to sell something, I'll sell Tech because I feel so good about financials or insurance or industrials given the Trump rally.
BARTIROMO: Most -- real quick before we go. The most important issue that you're looking at Tom for the New York Stock Exchange, for investors in 2017.
FARLEY: It's really just restoring confidence both for listed companies but also for our trading customers because it's been two years of just -- notwithstanding this 10 percent increase -- of just uncertainty. We had a surprise devaluation of the yuan a little over a year ago that really rocked markets and hurt our IPO market.
That led into this year. We had uncertainty with the election this year so it's just kind of -- helping bring a sense of calm and hopefully that will result in bringing retail investors back to the trading market as well as a greater IPO year in 2017.
BARTIROMO: You're walking around the floor all the time. You talk to the big investors. Do you think this Trump rally continues? What are you getting in terms of the sentiment?
FARLEY: I think they're a lot of pleasant surprises, maybe even with his cabinet appointments, frankly. And I think I mean just sitting in the room out here you had NYSE listed Rex Tillerson added to the secretary of state conversation, Huntsman, Stavridis -- these are all three people I know personally. These are good people. They love their country. They're going to do anything they can for their country. And that is the sense on the floor too. Were putting together a cabinet, people like Nikki Haley that can help lead this country going forward.