DEVELOPS.
THE AMERICAN APPAREL AND
FOOTWEAR ASSOCIATION, THANK YOU
FOR JOINING US TODAY, RICK.
APPRECIATE IT.
>> THANK YOU.
>> YOU ARE LOOKING AT A MAJOR
SELL-OFF ON WALL STREET.
NO DOUBT ABOUT IT.
ALL THREE MAJOR INDICES DOWN 2%
OR MORE AT THIS HOUR.
THE DOW BRIEFLY DIPPING BELOW
600 POINTS.
IT IS OFF 589 NOW, BUT THE DOW
AND THE S&P 500 ARE ON PACE
RIGHT NOW FOR THE BIGGEST DROP
SINCE BACK IN FEBRUARY 8th
WHERE WE SAW THE TREMENDOUS
VOLATILITY.
>>> LET'S GET UP TO CHARLIE
GASPARINO.
CHARLIE, WHAT'S YOUR TAKE ON
ALL OF THIS?
IS THIS ALL TARIFF DRIVEN OR A
NUMBER OF THINGS IN PLAY TODAY?
>> WELL, I MEAN I THINK IT'S
GENERALLY COMBRN THE TRUMP
ECONOMIC MESSAGE GOING FORWARD
AND HOW TARIFFS PLAY INTO THAT.
REMEMBER THIS IS A CONVOLUTED
ECONOMIC FISCAL POLICY WE HAVE
HERE.
ON ONE HAND LOW TAXES, LESS
REGULATION, RIGHT?
WE HAVE AN ADMINISTRATION THAT
WANTS TO END NET NEUTRALITY,
YOU THINK THEY WANT TO BE HANDS
OFF ON TERMS OF BUSINESSES AND
THAT NATURE.
ON THE OTHER HAND, YOU HAVE THE
PRESIDENT TALKING TARIFFS
TODAY.
I BELIEVE THERE WERE ORAL
ARGUMENTS IN THE AT&T-TIME
WARNER CASE JUST BEGIN.
HE'S LOOKING TO BREAK UP A DEAL
THAT WOULD CREATE EFFICIENCIES
BECAUSE OF SORT OF VERY
AMORPHOUS BELIEFS THAT IT WOULD
RAISE THE CONTENT THOUGH WE
KNOW CONTENT IS UBIQUITOUS ON
THE INTERNET AND EVERYPLACE
ELSE.
THIS IS AN ECONOMIC MESSAGE
THAT IS HARD TO DIGEST AT
TIMES.
WE'RE HAVING ONE OF THE
INDIGESTION BOUTS RIGHT NOW.
I OFTEN CALL IT A PUKE.
IT'S MORE THAN INDIGESTION.
BUT JUST SO YOU KNOW, THAT'S A
MARKET TERM.
THEY CALL IT A PUKE.
ASHLEY: OF COURSE, TECHNICAL.
>> YES, VERY TECHNICAL.
TRADERS ARE LIKE THAT.
AS YOU TRY TO DIGEST WHAT'S
GOING ON.
I WILL SAY THIS, AND HERE'S THE
GREAT UNKNOWNS FOR THE AVERAGE
INVESTOR, WHY I SAY DON'T
PANIC.
WHAT IT REALLY, REALLY COMES
DOWN TO, THE DEVIL IS IN THE
DETAILS OF CORPORATE EARNINGS
AND GDP.
AND THOSE ARE THE TWO THINGS
YOU HAVE TO KEEP AN EYE ON IF
YOU WANT TO BUY STOCKS.
TRADE WARS ARE NEVER GOOD, THAT
HURTS GDP AND CORPORATE
EARNINGS, YOU HAVE TO SEE WHAT
HE DOES AND TRANSLATES INTO
NUMBERS.
WE'RE GETTING A MASSIVE TAX
CUT, AN ADMINISTRATION THAT
PULLED BACK ON REGULATIONS AS
IT'S THROWN A COUPLE CURVEBALLS
LIKE GOING AFTER THE AT&T-TIME
WARNER MERGER.
IF YOU PUT THOSE THINGS
TOGETHER, THAT'S POSITIVE FOR
STOCKS.
IF YOU SEE THE BOUNCE OF GDP
ABOVE 3%, THAT'S A BUY SIGNAL
FOR STOCKS USUALLY.
IF YOU SEE CORPORATE EARNINGS
START TO RAMP UP BECAUSE OF THE
MASSIVE CORPORATE TAX CUTS.
AGAIN, THAT'S USUALLY GOOD FOR
STOCKS.
SO THIS IS -- I'M NOT IN FAVOR
OF THIS THING, AND I'LL TELL
YOU, OF TRADE WARS, I HEARD THE
LAST GUEST, IT ALWAYS HURTS IN
THE LONG RUN, AND IT WILL
DECREASE AT THE MARGIN, IT WILL
DECREASE CORPORATE EARNINGS AND
HURT THE ECONOMY.
BUT ASHLEY, WE -- THIS HAS TO
BE -- THIS IS NOT LIKE, IT'S
NOT BINARY, RIGHT?
THERE'S A MILLION THINGS IN
FACTOR INCLUDING THE FACT WE
HAVE BUSINESSES REACTING ALSO
TO TAX CUTS, REPATRIATION OF
WEALTH OVERSEES.
ASHLEY: AND CHARLIE, AND WHAT
ABOUT THE REACTION, I WAS ON
THE AIR WITH STUART VARNEY WHEN
WE GOT NEWS JOHN DOWD RESIGN
AND SAW THE MARKET TAKE ANOTHER
LEG DOWN.
HOW MUCH OF WHAT IS GOING ON AT
THE WHITE HOUSE AND THE DAILY
SHAKE-UP.
HOW MUCH IMPACT DOES THAT HAVE
ON THE MARKET?
>> TALKED ABOUT STABILITY.
THAT WAS ON WHEN YOU WERE ON
WITH STUART.
BACK IN DECEMBER, I WAS ON
STUART'S SHOW WHERE I BROKE A
SMALL STORY.
I GAVE YOU THIS CAVEAT.
I SAID LISTEN, THE PRESIDENT IS
TELLING PEOPLE, THIS IS IN
DECEMBER, HE EXPECTS TO BE
EXONERATED OUT OF THE RUSSIAN
PROBE BY THE BEGINNING OF THE
YEAR.
WE'RE WAY PAST THE BEGINNING OF
THE YEAR, AND THE ONE -- AND I
SAID BUT WHAT PEOPLE ARE
TELLING THE PRESIDENT, HOLD
YOUR HORSES, MUELLER CAN EXPAND
THE INVESTIGATION INTO YOUR
PERSONAL FINANCES, WHICH AS YOU
KNOW HE HAS, AND THAT COULD BE
A PROBLEM FOR YOUR PRESIDENCY,
AND THE MARKETS TRADE OFF ON
THAT.
ONE OF THE THREATS TO THE
MARKET RIGHT NOW IS MUELLER.
INCREASINGLY VERY TOUCHY ON ANY
MUELLER NEWS.
BUT I THINK THAT IS SORT OF
LIKE -- THAT'S LIKE THE CREAM
ON TOP.
THAT'S LIKE THE FOAM ON TOP OF
THIS BEER.
ASHLEY: ON TOP OF THAT, YOU HAD
THE FED YESTERDAY, I GUESS YOU
COULD SAY HAWKISH, GAVE PAUSE
TO THE MARKETS TO SAY TWO MORE
RATE HIKES THIS YEAR, THREE
NEXT YEAR.
I THINK THAT WAS A REALITY TAKE
FOR THE MARKETS AS WELL.
>> THE WAY I EXPLAINED THAT ON
CAVUTO'S SHOW AND BEFORE HIS
PANEL'S REMARKS, THE FED CHAIR,
IT WAS PAY REAL CLOSE ATTENTION
TO THE MUSIC, TO THE CHAMBER
MUSIC AROUND THE SORT OF -- THE
STUFF AROUND THE TAX CUTS AND
HOW HE EXPLAINS IT, AND THAT
WILL BE A SIGNAL TO THE MARKET.
NOW ONE OF THE THINGS THEY
THINK THE MARKET SOLD OFF ABOUT
IS WHEN HE MADE SOME COMMENTS
ON TARIFFS.
IF YOU NOTICE, HE IS NOW
SAYING, SAID HE HE DOESN'T
THINK IT'S A BIG DEAL FOR THE
ECONOMY.
I'M PARAPHRASING WHAT HE SAID,
YOU CAN GET THE EXACT QUOTE.
HE WASN'T ALARMIST ABOUT IT.
HE DID MENTION IT.
IT WAS ON THE FED'S RADAR.
IF YOU LOOK BACK AT THE TAPE,
THE MARKETS STARTED SELLING OFF
ON THAT, I BELIEVE YESTERDAY WE
CLOSED DOWN MARGINALLY.
IT WASN'T 600 POINTS, AND IT
CAME AFTER THE REMARKS.
IT WAS UP 200 POINTS INTRA-DAY.
THAT'S WHAT YOU HAVE HERE.
THIS MARKET IS FREAKED ON
TRADE.
IT IS LITERALLY ON EDGE ON
EVERYTHING ABOUT TRADE.
THE MARKETS ARE SAYING NO
DOUBT, EVERYBODY AND THEIR
UNCLE AND I READ SOME OF THE
STUFF THAT PETER NAVARRO PUT
OUT THERE, TRUMP'S ECONOMIC
ADVISER, VERY TOUGH ON CHINA.
IT TAKES AN IDIOT TO AGREE THAT
CHINA IS LOOKING TO SCREW US
EVERY WHICH WAY.
BUT THE MARKET IS SAYING
SOMETHING ALONG THE LINES WHAT
THE LAST GUEST SAID, THERE IS A
WAY OF THREADING THIS NEEDLE
WITH YOU DON'T USE
PROTECTIONISM AS A BLUNT
INSTRUMENT.
THE MARKETS ARE WORRIED ABOUT
THE BLUNT INSTRUMENT.
THEY DON'T KNOW IF THE
PRESIDENT KNOWS HOW TO USE IT
AS A -- KNOWS HOW TO NEGOTIATE
HIS WAY AROUND THIS STUFF.