Investor Ken Fisher on Trump's proposed tariffs on Mexico

This is a rush transcript from "Your World," June 5, 2019. This copy may not be in its final form and may be updated.

NEIL CAVUTO, ANCHOR: Thank you, Shepard.

Can the talks avoid the tariffs? You are looking like right now at the White House, where Vice President Mike Pence, Secretary of State Mike Pompeo are meeting with Mexico's foreign secretary as we speak.

Now, the administration telling our neighbors south of the border you either bring migrant crossings down or tariffs on your goods, all your goods are going up. In just a matter of minutes, we may finally know what's up.

Welcome, everybody. I'm Neil Cavuto. And this is "Your World."

To Rich Edson at the White House on what we know right now.

Hey, Rich.


The Mexican foreign secretary is in Washington, scheduled to meet this hour, last hour even, with the vice president, Mike Pence, Secretary of State Mike Pompeo, who we have seen come here to the White House for these discussions.

President Trump is in Ireland, though he says this is no bluff, either Mexico does more to stop illegal migration that ends up at the U.S. border or the tariffs start Monday.


DONALD TRUMP, PRESIDENT: Mexico can stop it. They have to stop it. Otherwise, we just won't be able to do business. It's a very simple thing. And I think they will stop it. I think they want to do something. I think they want to make a deal. And they sent their top people to dry and do it. We will see what happens today. We should know something.


EDSON: The president has threatened 5 percent tariffs on all Mexican imports into the United States, potentially rising to 25 percent.

This afternoon, U.S. Customs and Border Protection reported that it apprehended or turned away more than 144,000 at the southern border last month alone. Officials say those are numbers they have not seen in more than a dozen years. And more than 11,000 were unaccompanied children.

Officials say primarily they're traveling through Mexico from Guatemala, Honduras, and El Salvador. Mexican officials argue tariffs would only make it more difficult for them to address the migrants traversing their country. They say their government has decisively cracked down on illegal transportation of migrants through its territory.

Mexico also says these Northern Triangle countries, Guatemala, El Salvador and Honduras, need more international aid. President Trump cut American aid to those countries, arguing that their governments were not doing enough to stop the migration that was flowing north and ending up at the U.S. southern border -- Neil.

CAVUTO: All right, my friend, thank you very, very much.

Well, you think this trade fight really doesn't affect you, you might want to think again. Prices on everything from autos to avocados -- imagine if you're buying both -- they could be going up if tariffs.

Robert Gray at FOX Business Network in Los Angeles to tell how big a hit you could be taking -- Robert.

ROBERT GRAY, CORRESPONDENT: Yes, Neil, we could be talking about -- pardon the pun -- but a lot of guacamole here, literally, tacos, burritos, Mexican food.

Chipotle out, media reports saying that this could cost him as much as 15 million bucks in food costs, which will likely be then passed on to you and me and those who eat at these types of chains. One major restaurant chain wasn't ready to give me a comment today when I reached out to them.

But you think about it. Fruit, we're talking about $7 billion, veggies $7 billion, wine and beer $3.6 billion, alcoholic beverages, think tequila, it's almost $2 billion.

Companies not likely to stomach these imported price tariffs, though. They're likely to pass them on to us. Some companies could be getting hit twice with 25 percent tariffs on goods from China as well. Think about it. Manufacturing has been boosting production in Mexico. Some people were diversifying away from China. Others, of course, migrating there during the NAFTA over the past quarter century.

The value of goods imported from Mexico, you see the number, $346 billion, that's just about doubled, Neil, over the past decade. A few items you may be paying more also including auto parts, almost $150 billion dollars, TVs and video equipment $9 billion, steel $1.1 billion, computers, lots of trucks and buses and autos combining for new $70 billion.

And one major import, one of the few that have decreased over the past decade is crude oil. It's down by a third. But the complex where we live in, Neil, can sort of be summed up by this. A brand-new golf club, the shaft and the head come from China. They were assembled in Mexico, perhaps trying to skirt some of the tariffs. They could be hit after all, though.

CAVUTO: The irony of it all.

All right, Robert, thank you very, very much.

Well, the president is really not worried about any political fallout from these trade talks, telling Piers Morgan -- and I quote here -- "I'm running on maybe the greatest economy we have ever had. I'm in the midst of a couple of trade negotiations which I think are going to work out very successfully, because we have the cards. I have all the cards."

Does he?

To Charles Payne, the host of "Making Money," Democratic strategist Jon Summers, Republican strategist Deneen Borelli.

Charles, what he is saying is the wind at my back is this incredible U.S. economy. I can survive.

CHARLES PAYNE, CONTRIBUTOR: Well, yes, as long as economies stays like this, I think he's right.

But also there was another amazing number that came out today, 144,000 border apprehensions last month, up 32 percent month over month, well over 100 percent year over year, three months in a row over 100,000.

It's an unmitigated crisis of a magnitude that everyone has to agree must be addressed. So...

CAVUTO: But is this the way to address it?

PAYNE: Well, I think what's happened is that there's been a lot of negotiations going on between America and Mexico.

And I think promises may have been made that just weren't kept. Just like when the -- when we sent over our proposal to China that they talked about, they hammered it out, or at least they thought it did, and they got it back, then it was all marked up like one of my high school term papers, right?


PAYNE: The president felt like, hey, you know what, these guys pulled a fast one.

I think they felt like Mexico was just dragging their feet. I don't know that anyone wants this to be what happens. And, of course, no one wants to pay an extra nickel for their Chipotle burrito.



CAVUTO: Forget about that. Corona, I mean, yes. All right.

PAYNE: I think President Trump's core owners, though, if the economy holds up, and these numbers keep going up like this, they believe it's a crisis.

CAVUTO: What I worry about, Deneen -- I understand the method to this and all, but I could see trade tariffs to address trade concerns. This is trade tariffs to address a totally unrelated concern, a legitimate, genuine one.

But that's playing with fire and could embolden other presidents too, that we don't like a country's climate change policy, for example, we're just not going to deal with you.

DENEEN BORELLI, CONSERVATIVE REVIEW: Well, I agree with everything Charles just said.

CAVUTO: Of course you did.



BORELLI: And, listen, the president -- but this is the way the president has been able to get Mexico's attention, right, the threat of tariffs.

Now, I hope they don't go into effect. And if they do, I hope it's short- term. But he has their attention now. And this is the president who is unlike any other president. So he puts these proposals out there, gets their attention, just like he did with China, for example.

And now they want to talk, they want to negotiate. And, listen, what we have seen on the border is just absolutely outrageous. It's a humanitarian crisis.


CAVUTO: No doubt, but is this the lever to do it?

BORELLI: I think this a good method to do it.

CAVUTO: All right, you think it is.

That's my only concern. I'm not playing politics with this one way or the other, Jon. I just think it could be a very slippery slope.


And let's also not forget the fact that, who in the world is Donald Trump to tell Mexico how to handle their borders, when he can't even seem to handle our own borders here in the U.S.?

He has the opportunity to work with Congress. He's refusing to work with moderate members in both parties to actually achieve..


CAVUTO: I mean, to be fair, he has tried. I mean, no one's really helping or addressing this issue. You can't put that on him. This has been going on under multiple presidents.

SUMMERS: Oh, yes, but he should figure out his own problem before he starts telling...


CAVUTO: Well, isn't Mexico part of that problem?

BORELLI: Mexico is part of the problem.

SUMMERS: Well, but we're taking aid away from the countries where these people are coming from. It's not on Mexico.


SUMMERS: They have lost what, about, $450 billion worth?

And, by the way, the tariffs have already cost us money. The tariffs have cost us billions of dollars.


BORELLI: ... those countries were getting the money, they wouldn't be trying to come to the United States.

SUMMERS: Last month, as a result of the trade war with China and European -- and Europe, we spent -- we put together a $16 billion emergency aid package for farmers, one industry, one industry. And that's on top of the $12 billion we had to do a year ago.

So, don't tell me trade tariffs work.


PAYNE: The treasury took in $75 billion in the first quarter. You look at a chart, it's a crazy amount of money. How it's divvied up is debatable, but the American consumer is not bearing the brunt of that.

CAVUTO: But do you worry about that, that it does backfire? The same economy that he's shepherded through -- and if we're going to blame presidents when the economy's lousy, we might as well credit them when it's good.

And does he take all that away? We had a trade deal, Charles, with Mexico going. It was signed, sealed, almost delivered.

PAYNE: Well, hopefully. I think everyone hopes it gets going.

But let me just give you the best proxy. Wal-Mart, everyone would agree is probably the best corporate proxy for China trade. They import the most China plastic stuff. The first quarter, the average ticket price was up 2 percent. And that was their best first quarter in a long time.

In other words...

CAVUTO: Well, but the 25 percent tariffs haven't kicked in.

PAYNE: Right. Right.

But I'm just saying it's not all going. When people just come on TV and say Americans are paying that, American consumers are paying that, there's not one item in the world that an American would pay 25 percent more to...


CAVUTO: No, I grant you that. But that was at a time at 10 percent on a lot fewer goods.

PAYNE: Right. Right.

CAVUTO: Now we're going to be in a period where it will be 25 percent. And, ultimately, with the Mexican stuff, it will be -- start at 5 percent, go all the way up to 25 percent if something isn't settled.

That's when it could bite, Deneen. Are you worried about that?

BORELLI: Well, listen, I'm hoping if it does happen that it is short-term.


CAVUTO: Well, everybody does. But this has been dragging on. The China thing has been dragging on.

BORELLI: But the other thing is what people are looking at this from a perspective of the approval of the president's handling of it.

You have 46 percent of voters who favor the tariffs. They want to stop illegal immigrants coming in. They want to stop the drugs that are pouring across our border. So they're looking at the president handling this how he can, considering we can't get Congress to play their role and do...


CAVUTO: No, no, I agree. There's a lot of blame to go around.

But do you worry, though, that we're getting to be not a country of our word, that we reach an accord with the Mexicans trade, and we throw this new one in, it's a whole new ball game?

If I'm China looking at this, aren't I just going to say these guys blame us for reneging on a deal and agreed talking points and then they do?

BORELLI: I look at this as leverage.

The president has leverage. He's gotten Mexico coming to the table. They're like, we want to talk about this. We want to work this out.

CAVUTO: He doesn't have China running to the table.


PAYNE: And I will let you in one second -- this is what I love, though, about what you just said.

China has reneged on every agreement, including all the agreements they made when they entered the World Trade Organization. They use it as a farce, as a Trojan horse to steal from everyone, not just America. So they don't care about these agreements.

The idea now is that they know they have a president in the White House, if they do -- we come up with the ultimate deal and they do cheat, that this is a president who's not going to be afraid to say, oh, no, no, no, we're not going to do that.

CAVUTO: You don't think that -- my only concern, do you think it boomerangs on him?

SUMMERS: We will see.

PAYNE: We will see.


SUMMERS: We will see if he actually does that, because right now he does a lot of threatening, but then, when it actually comes down to follow- through, that's where...


PAYNE: And that's why there are the tariffs on Chinese products right now that no politician would have done because they wouldn't have had the nerve.


CAVUTO: And, by the way, if this was so disastrous, we wouldn't be looking at record low unemployment right now, key demographics doing pretty well.

SUMMERS: Well, it's taking a little while...


CAVUTO: And I know much hasn't kicked in, but...

SUMMERS: It's easy for us to sit here and say, you know what, a nickel here and nickel there doesn't cost much.


SUMMERS: Let me talk here.


CAVUTO: I should stress, guys, I wish we had more time, but nothing has really kicked in yet. The substantive ones haven't really kicked in yet.

If and when that happens, then maybe we will have another panel discussion.

In the meantime, the president says Republicans would be foolish to challenge him on these Mexican tariffs. I want you to meet the Republican senator who's foolish enough to attack the real source of the problem. And it doesn't involve tariffs.


CAVUTO: While the president is pressuring Mexico to stop illegal immigration, he's running into surprising resistance from some in his own party, many Republican senators who say tariffs won't solve the crisis; dealing with the root of the problem will, like sanctuary cities.

Arkansas Republican Senator Tom Cotton co-sponsoring legislation to put an end to them.

The senator is joining us now, out with a new book, "Sacred Duty: A Soldier's Tour at National Arlington Cemetery" -- Arlington National Cemetery, I should say.

Senator, an honor to have you. Thank you.

SEN. TOM COTTON, R-ARK.: Hi, Neil. Thanks for having me on.

CAVUTO: So, you want to address the root of the problem. And that would be sanctuary cities. Explain how this works.

COTTON: Sure, Neil.

That's one of the problems. Once illegal aliens cross into our country and they fade into the shadows, we have major metropolitan areas that are giving them sanctuary. They're telling their local law enforcement officers not to cooperate with federal immigration authorities, even when those illegal aliens commit crimes.

Now, even the Democrats say that they want to crack down on illegal aliens who are criminals, yet we can't do that if they're being released from city and county jails without turning them over to the immigration authorities.

Just up the road a few weeks ago, we had a terrible tragedy where two MS-13 members were released from local custody. They weren't handed over to federal immigration authorities. And they beat a young 14-year-old girl to death.

That wouldn't happen if we didn't have this problem with illegal immigration, and especially if we didn't have sanctuary cities.

CAVUTO: Do you think that should have been the president's approach? I mean, these a lot of good ideas getting to the root of the problem. That's among the roots of the problem, to your point, but that this tariff thing goes in another area?

COTTON: Well, we do need to get to the root of the problem.

I understand the president's frustration with Mexico not doing enough to try to help us solve this crisis. Some of it is at the doorstep of the Mexican authorities. For instance, they could do a better job of policing their southern border, which is barely 1/20 the size of our border with Mexico.

They could stop these caravans traversing over 1,000 miles in their country. And they could live up to their obligations that they made just last year, the secretary of state, Mike Pompeo, to keep these illegal aliens in their country as they apply for asylum in our country.

The president has threatened to impose a tariff as early as next week if the Mexican government doesn't do that. Now, it has prompted action by Mexico. The foreign minister is in Washington today. I think he's actually meeting with the vice president and Secretary Pompeo this afternoon.

CAVUTO: Right.

COTTON: My hope is -- and I suspect the president's hope as well is that Mexico will agree to take those steps and those tariffs will be unnecessary.

CAVUTO: The reason why I ask, Senator, is, the Mexicans come back and say, what are you talking about? The deportations that we led have gone up markedly, from -- to 15,000 to the latest year from 9,000 the year before.

So they say they have been on top of this problem, and aggressively policing it, and that they're being scapegoated here. You say?

COTTON: The numbers just tell a different story, Neil.

Just -- we just learned in May that over 130,000 illegal aliens crossed our border, many of them not running away from Border Patrol agents, but running to Border Patrol agents, making bogus, fraudulent claims of asylum.

Many of those come from Central America. They have got to cross over 1,000 miles of Mexican territory before they get to our border. And that's in addition before they cross over Mexico's very small southern border. So the numbers belie the Mexican government's claim that they can't do more to help the United States with this crisis that is also a humanitarian crisis that we face at our southern border.

CAVUTO: Many of your colleagues, I don't know where you stand on this, Senator, are getting concerned that the president is over-abusing his powers, and that slapping tariffs on Mexico isn't the answer. For one thing, it's going to complicate the trade deal we already have, might have torpedoed it, they worry.

But they also say that the president's going overboard here, and they want to call him on it. Do you?

COTTON: Well, Neil, as a legal matter, I think it's pretty clear the president has this authority.

Two of the administration's senior lawyers briefed Senate Republicans yesterday about that. I didn't hear much dispute as a legal matter whether the president has this authority delegated by Congress. It's a different question of whether you agree with these tariffs as a policy matter.

My preferred outcome would be the threat of these tariffs get the Mexican government to uphold some of its commitments and help us reduce the number of illegal border crossings. Second, we pass the Mexico-Canada trade agreement that the president renegotiated with Mexico and Canada.

And then, third, we focus our fire on a country that really is an adversary, which is China.

CAVUTO: All right.

COTTON: I hope it's going to be the first steps coming out of the meetings this afternoon with the vice president and the secretary of state.

CAVUTO: All right, we shall see. No word yet, but, to your point, they are meeting.

Senator, very good seeing you. Thank you.

COTTON: Thank you, Neil.

CAVUTO: Well, it is hardly news to hear Bernie Sanders blasting Wal-Mart, right? But Wal-Mart inviting him into its shareholder meeting to state his case?

We're on the case.



SEN. BERNIE SANDERS, I-VT, D-PRESIDENTIAL CANDIDATE: Wal-Mart pays many of its employees starvation wages, wages that are so low that many of these employees are forced to rely on government programs.

Frankly, the American people are sick and tired of subsidizing the greed of some of the largest and most profitable corporations in this country.


CAVUTO: This is not the first time, of course, that 2020 presidential candidate Democrat Bernie Sanders has slammed Wal-Mart, but it is the first time, to my memory, he's delivering the blows from the floor of the company's annual shareholder meeting, and get this, Wal-Mart inviting him in to do so.

FOX Business Network's Jeff Flock in Rogers, Arkansas, where all this is happening -- sir.

JEFF FLOCK, FOX BUSINESS NETWORK CORRESPONDENT: Yes, there was talk about him crashing the meeting, but he didn't need to crash it. The folks at Wal-Mart said, yes, you come listen to us, we will listen to you.

And that's what happened. By the way, I just got this in. These are the results. Bernie -- the reason for Senator Sanders there was to support a shareholder proposal which would have asked the board to consider Wal-Mart associates, the hourly employees, for a seat on the board.

I just received the results of the vote. It got less than point 0.01 percent of the vote. Hopefully, I'm sure Senator Sanders hopes he does better when he runs for president than 0.01 percent of the vote.

That said, he did make a fairly articulate case, as you just heard there, inside the meeting, and to his supporters outside the meeting. Take a listen.


SANDERS: One might think that a family worth $175 billion would be able to pay its employees a living wage.

You can't pay rent, you can't get health care, you can't feed your kids or put gas in the car on $11 an hour.


FLOCK: So, they listened to Bernie Sanders, and Bernie Sanders listened to them, in the person of Doug McMillon, the CEO of Wal-Mart, who said, well, we don't pay $15 an hour, we pay $11 an hour to start. But we paid this past year 793 million additional dollars to those same workers in bonuses.

The good workers actually got more money. He also pointed out that another 215,000 of those workers got promoted because they did a good job. In addition, 57 percent of those promotions went to women, another 45 percent to people of color.

So both sides made their case today, Wal-Mart saying it's actually treating workers pretty well, Bernie Sanders saying, you can do better -- Neil.

CAVUTO: Jeff, thank you very much. Very interesting to see them invite him into the belly of the beast, so to speak.

All right, thank you.

In the meantime, the president is in Ireland right now. It might not be his most important stop on this European tour, but what if I told you it just could be his most rewarding? Just ask John Kennedy or Ronald Reagan.

If all goes well there, it could help him more than just a wee bit back here.


CAVUTO: What is going on in that building?

A live shot of the White House right now. We have the foreign secretary of Mexico meeting with the secretary of state and the vice president of the United States. They're trying to iron this whole thing out with tariffs for Mexico.

Updates after this.


CAVUTO: President Trump is in Ireland right now visiting there, wrapping up his three-day state visit to the United Kingdom.

President Kennedy, of course, visited in the summer of 1963. It was Ronald Reagan who did the same a little bit more than 21 years later. Each saw a boost in their approval ratings after visiting the Emerald Island.

Could President Trump have the same lasting effect?

Now, Doug Wead, historian extraordinaire, is here.

It's interesting, Doug, when you look back at history. Other presidents have visited Ireland, of course. Those two sort of had ancestral rights to it. And, for John Kennedy, it was a very, very big deal. He later claimed it was among the best four days of his entire presidency. Sadly, five months later, he would be gone.

But what is it about this Emerald Island that does that?

DOUG WEAD, FORMER ADVISER TO PRESIDENT GEORGE H.W. BUSH: I think it's the fact that anybody can achieve something great with their life.

The Kennedys were three generations away from abject poverty. John Kennedy's great-grandson father lived in poverty. Ronald Reagan's great- grandfather was a tenement farmer in Ireland.

And it's -- also, it snubs the nose of the British a little bit.


WEAD: You remember, when George Washington was president, the British presented him with a genealogy to explain how he could defeat them in battle. He had to have royal blood somewhere back in there. But, no, Washington rejected it, the gift, and said, from here on, in America, it's what you aspire to be.

And that's what comes from these Irish stories.

CAVUTO: It's funny too that both presidential museums honoring John F. Kennedy and Ronald Reagan memorialize those visits to Ireland, and particularly in the case of Ronald Reagan, rebuilding and sending over from Ireland the very pub he visited when he was there.

WEAD: Yes.

We all have Irish stories. My great-grandmother came from Ireland, and her husband was killed in the Battle of the Little Bighorn.


WEAD: Custer's last stand. She remarried another Irishman from another brigade of the 7th Cavalry. They gave birth to my grandmother.

So the point is, I wouldn't be on television or alive if Custer had not been wiped out at the Battle of the Little Bighorn.

CAVUTO: All right. So he's the one I blame.


CAVUTO: All right, so let me ask you, Professor, I mean, we talk about this.

I always think these are kind of endearing moments, especially when there's a family link, and you're essentially going back home. Now, for Donald Trump, of course, he is of more Scottish descent, not too far away. But, again, it's an opportunity to connect in sort of a non-official capacity with people who are universally loved the world over.

WEAD: Yes.

Well, again, it raises this idea up that anybody can be president. And the thing about Donald Trump, yes, he's a billionaire. He owns a golf course. That's one of the reasons he's visiting Ireland. He owns land there.

But even so, in a way, Trump represents this anybody can do it, because he upset all the experts by winning the election. He upset all the experts by rebuilding the economy. So maybe some of that Irish dust will fall on his shoulders.

CAVUTO: Now, I'm wondering, too -- I mean, obviously, at the time John Kennedy went there, I mean, I guess they added to the itinerary his actual ancestral home, that it wasn't just going to be in China and Ireland.

He was going to go right back to where his grandparents started out and all the poverty. You have talked about this. So there was an emotional connection, wasn't there?

WEAD: Yes, absolutely.

Again, it's the poverty, to think anybody can do it. They can rise from such circumstances, that it's reassuring to us that we don't have to be victims. We aren't born to a certain destiny. We can help create that.

And Reagan family and Reagan shows that, and the Kennedy family, and the Kennedys showed that. They were three generations away from everything. And that's pretty remarkable.

CAVUTO: I remember there's a great story -- and I will end it here, because I'm going on and on. But, being half-Irish, you will have to indulge me.

There's this great story of Ronald Reagan that he told those he was meeting with at this pub about people who had recognized the family name and earlier on had remembered what the Reagans meant.

And one of them, apparently, Reagan is saying, "Whatever happened to him?" referring to Ronald Reagan himself as president of the United States.


CAVUTO: A funny memory, a funny little story, lots of those. Who knows? We will maybe see some more in the president's waning hours in Ireland.

Professor, always a pleasure. Thank you, my friend.

WEAD: Thank you, Neil.

CAVUTO: All right, well, forget China. If one of the world's most successful investors is right, if things don't go right south of the border, they might go south at the corner of Wall and Broad.

We're on it after this.


CAVUTO: All right, there's nothing more exciting than showing microphones. And that's a microphone stand outside that North Portico of the White House here.

The Mexican foreign secretary is meeting with the secretary of state, also the vice president of the United States.

We have got the latest right now on what's happening with Jackie DeAngelis of FOX Business Network.

What are we expected to hear?


Well, we were able to see Secretary of State Pompeo going into the meeting. It's possible Vice President Pence was already there. We were expecting Robert Lighthizer as well and the Mexican foreign secretary.

The meeting was supposed to start at 3:30. We haven't gotten any updates or any headlines coming out of the conversations, but a lot certainly at stake here, Neil.

Monday, June 10, the president said he will impose a 5 percent tariff on more than $300 billion of Mexican imports. While there's been some GOP opposition, and that's been the focus of a lot of the conversation, there's also been some GOP support for the president's position as well.

Listen to this.


SEN. JOHN CORNYN, R-TX: I support getting Mexico doing more. And I hope the conversations that are occurring today produce more cooperation by Mexico. They could have a big impact.

But I think the tariffs are unnecessary if we can get congressional Democrats to just do their job.


DEANGELIS: Senator John Cornyn, Republican from Texas, saying the Democrats should be doing more. They should be doing their job on this issue.

Now, an update on where we stand in terms of border apprehensions, the U.S. Customs and Border Patrol earlier today calling the border issue a full - blown emergency. That was after it announced that for the month of May, it's close to 133,000 apprehensions. That was beyond any other single month in the last five years.

So it's certainly an unconventional approach to tackling immigration. Usually -- usually, the tariffs are reserved for trade conversations. The Mexicans have expressed a willingness to negotiate with the United States and to work with the president.

The question, of course, is how high have they set the bar and will they agree to the president's terms? On top of that, of course, can they actually enforce and stick to the promises that they make if they do make them here today?

In Ireland earlier, the president saying -- of course, digging his feet in and sticking with his position -- Neil.

CAVUTO: All right, Jackie, thank you. Good work, as always.

Well, Ken Fisher didn't become one of the world's most successful investors and a billionaire many times over obsessing over the latest crisis. He is a longer-term player, after all, but that doesn't mean he isn't concerned about how all of this trade stuff is unfolding, and, ironically, not with China. He's talking about with Mexico.

Ken Fisher joins me now, the founder of Fisher Investments.

Good to see you again.

KEN FISHER, FOUNDER, FISHER INVESTMENTS: Always good to be with you, Neil. Thank you so much.

CAVUTO: I follow your tweets as well.

And you had talked about the Mexico trade rift -- I hope I'm quoting this accurately -- where you said: "Prior tariffs have been relatively tiny to GDP growth. These -- Mexicans', if fully implemented, are more important than all the others earlier together."

FISHER: Yes, absolutely, that's true.

The fact of the matter is, you can just tally up the amounts and the percentages, and speak to them relative to America's GDP or global GDP.

CAVUTO: So you're talking all the way to the max, if this gets up to 25 percent, right.

FISHER: All of them hit the max, all in, no assumption for substitution effects. You got more than all the other tariffs put together.

Now, all the other tariffs put together, as I have said before, and I have said on your show before, are really much smaller than people think they are. But Mexico is a bigger issue.

I also don't think any of it has anything to do with economics as it relates to Mexico. It's all about the border.

CAVUTO: And you argue an interesting position here, that this might be a backhanded way to get Mexico to pay for a wall.

FISHER: Oh, it's a simple concept.

The president has always had this quality, which he's articulated forever, which is, I start off like a crazy guy, and then they make me an offer, I take the offer, or maybe I lead them to an offer they didn't expect.

In this case, he offers them a crotch kick to tariffs. Then they come back in discussion. You Pompeo going in there, State.

CAVUTO: Right.

FISHER: And you say, look, here's the deal. You got a $1.2 trillion GDP. Your GDP is stalling anyway. You had a negative last quarter. How about you give me -- I couldn't get the money out of Congress. I'm going to run against that in 2020. How about you give me $3 billion? That's less than three-tenths of 1 percent of GDP.


CAVUTO: So, you think this is all the way to build a wall and have Mexico pay for it?

FISHER: You build a wall on your side of the border.

The Mexican police can't patrol that border. The Mexican military, they...

CAVUTO: This is all about a wall?

FISHER: Let's just think through what Trump should want to do.

What did he say he was going to do? He said, I'm going to build a wall, and I'm going to get them to pay for it.

This is a great way to do it.

CAVUTO: And this is the way you do that?

FISHER: Let them build it on their side of the border by 40 feet. And then all you got to do is monitor both ends. And then he can turn to the voter and say, I did what I promised. We got it built and they paid for it.

And it would be much cheaper for Mexico than putting up with the tariffs.

CAVUTO: Right. Interesting.

In the meantime, the markets, between the 207-point run-up today, the 500- plus yesterday, obviously seizing on the trade thing as an excuse for the Federal Reserve to say, we might be more inclined to support the economy by cutting rates if this gets too bad.

What do you think about that?

FISHER: So, I have never been a Fed fan.

People go yack, yack, yack, yack, yack about the Fed.

CAVUTO: Right.

FISHER: I'm kind of fed up on the Fed and have been now for, oh, maybe 30 years.

The fact is, we live in a world, as I have said to you before in prior shows, that is much more global than anyone thinks. I can borrow money in Europe. I then, through my company, can make an inter-company loan to my U.S. operations and get money at European short rates, use it in America for short-term purposes, and drive a hole through a 2.5 percent spread with the currency hedge.

The fact of the matter is, if I can do that, do you think it's possible that may be J.P. Morgan could or that maybe Goldman Sachs could or that maybe Microsoft could?

And the fact is, we are having America flooded with funding from overseas. Our yield curve isn't terribly important. If the Fed didn't cut rates, but instead increased rates, that flood would increase, because the hole would get bigger that you could arbitrage.

CAVUTO: So you're not obsessed with this yield curve inversion, because you look at the whole globe and it...

FISHER: It's the global yield curve that matters, not the U.S. yield curve.

The fact of the matter is...


CAVUTO: But, in the past, when we have had it in the U.S. -- in the past, when we have had it in the U.S., it has mattered. And it's always, always meant a slowdown or a recession.

FISHER: Yes. Yes.

And -- but it's also been true in those days that we had free market environments around the world at the short end, and we didn't have this spread with zero short rates, actually negative short rates, in Europe, and in Japan, big developed markets with financial capability to borrow and pour it into America.

We're -- the quantity of money is growing perfectly fine in America, despite the flat yield curve. It will continue to as long as there's that spread between foreign rates and U.S. rates.

CAVUTO: All right, so you're not worried about that. You're not worried about debt.


CAVUTO: You're not worried about debt. Why not?


FISHER: It's also one of the reasons the dollar is strong.

CAVUTO: No, you're right.

But why aren't you worried about debt? Everyone else is screaming about we're spending ourselves into oblivion.

FISHER: Well, you can argue that two ways.

One, everybody else is screaming about it. They're worrying about it. So I don't have to. Markets pre-price worries, right? That's just what they do. That's what markets do for a living.

CAVUTO: Markets miss things too, don't they?

FISHER: They do miss things, but not the things that everybody worries about.

Secondarily -- and just think this through, because people don't. What really matters is the carrying cost on the debt, not the absolute dollars of debt. If you actually look at America -- and you can do this for other countries as well -- and think of what the carrying cost is as a percent of tax revenue or as percent of national GDP, it's half the level that it was 20 years ago, because interest rates are down a lot more than the debt is up.

And the fact of the matter is what the government should do, which it won't, because I have never really believed the government's intelligent...

CAVUTO: Right.

FISHER: But what the government should do is extend the average maturity of the debt out to take advantage of the low long-term rates.

CAVUTO: So, refinance, essentially.

FISHER: And lock it in.


FISHER: Because, if you lock it in, my great-grandchildren won't have a debt problem.

The risk is...

CAVUTO: Well, because they're your great-grandchildren, and you're a billionaire.

FISHER: Three generations, shirt sleeves to shirt sleeves.

CAVUTO: All right. All right.

FISHER: So, when you go through -- when you go through that maturity process, the fact of the matter is, we have kind of been going the other way in the last number of years.

CAVUTO: Right.

FISHER: Taking advantage, if you will, or the politicians taking advantage of decreasing the duration. In some places, they have gone the other way, and that's smarter.

But you look at Germany. Germany has been paying down their debt. Is Germany doing great?

CAVUTO: No, that's a good point.

FISHER: No, it's not.

CAVUTO: Well, let me ask you then. The 700-point run-up we have, I mean, I think that if the Federal Reserve is all but saying we will cut rates after, hiking them 10 times through this cycle, beginning with Janet Yellen in the last year of Barack Obama, and they reversed that once or twice, wouldn't a part of you say, well, the Federal Reserve is cutting rates, they must see something that I don't, they must be worried about something?

Wouldn't that cause a little bit of a panic?

FISHER: Well, that's not what he said, though.

CAVUTO: I know. I know.

FISHER: What he said was, we will keep our eye on it, and we will make sure everything...


CAVUTO: But you know what he's saying.

FISHER: Well, the fact of the matter is, if anybody thinks that anybody at the Fed actually knows something, or that Janet Yellen ever did, they're smoking the funny stuff.

They're probably out there in Denver doing the psychotropic.

CAVUTO: Hey, careful. This is our core viewership here.

FISHER: Denver? Oh, OK.

CAVUTO: So, you said that central banks aren't very smart. And that's a rule of thumb you use. But they're what markets focus on. Are they just focused on the wrong thing?

FISHER: Yes, absolutely. People are focused on the wrong thing there.

So, let me just make a simple point. I'm going to say that if you went back and looked at the Fed notes of Janet Yellen's comments during October of 2008, if those had been released before her Senate confirmation, instead of afterwards, she never would have been confirmed as head of the SEC, because it was very clear that, in the middle of the meltdown, as it was happening that month, she had no clue what was going on.

I mean, she had no clue.

CAVUTO: Many don't. Many don't, to your point.

So let's see where we are right now. There is an anomaly with the third year of a presidential term. Nothing much goes on, right, for the president or for Washington. Gridlock is generally viewed as good anyway.

Do you subscribe to that?


So the history of third year of presidents' terms, going back to the beginning of the S&P data in 1925, is 91 percent positive third years. There have only ever been two negatives. The last one was 1939, just down nine-tenths of 1 percent with the S&P 500.

But there's a different point that people don't see, which is that same process actually occurs in parallel in a function in Europe, where what we have seen is a thing that has frightened people, fear in the market now, which is the fear of populism, oh, populism, populism, populism.

Well, what we have really had is traditionally a center-left and center- right party and then some fringes. And what populism has done is pushed down the middle of that ideological bell curve and increased the edges. And today, all across Western Europe, you create coalitions that are gridlocked because they can't agree with each other on much of anything.

Italy is the poster boy for that. It's the poster child of coalitions that can't actually do anything and are gridlocked.

CAVUTO: Why are you picking on my people?

So let me ask you...


CAVUTO: But, no, here's what I want to know.

If you're right and the things that Donald Trump is trying to do, if he were not reelected, you could argue that would be bad for the markets.

FISHER: You could, but you could argue a different way. And I don't want to go one way or the other.

CAVUTO: Well, what do you think? What do you think? I'm not being political here. Just what would...

FISHER: A, I don't know if Donald Trump gets reelected or not.

I think anybody that thinks they do at this point in time is also...

CAVUTO: Would it make a difference if, Election Day, it didn't go his way?

FISHER: Well, let's go back a different direction.

We don't know who the Democrats will nominate. We don't know how that will play. And what I will guarantee you is, we always -- somebody always wins. And we like the winner, on average, better than we thought we would beforehand.

Who that will be, how that will be, I don't know.

CAVUTO: But you did say that the president won't be impeached. You thought it was highly likely he would win the Electoral College vote again.

But did you say not the popular vote?

FISHER: Oh, I don't think he wants the popular. But he doesn't need to.

CAVUTO: OK, so...

FISHER: Yes. I mean, how do you overcome California?

CAVUTO: OK, I understand.

But he would win the electoral vote?

FISHER: I think, if the election were today, he would win the Electoral College, and he would lose the popular vote by a little more than he lost it last time.

But let me make...

CAVUTO: So, it's the way it is. It's the Electoral College vote. And he's reelected.

FISHER: Let me make a point to you that nobody notices.

And I'm not making a prediction here.


FISHER: If you look at the first year of president's terms, and break them down into Republicans and Democrats, the Democrats have double-digit positive years every single time going back through Franklin Roosevelt, with the exception of Jimmy Carter that was down seven-tenths of 1 -- 7 percent.

The Republicans most of the time had negative years, because the expectation for the Republican is high, the expectation for the Democrat is low.

CAVUTO: All right, Ken Fisher, always learn something, a thing or two.

Again, he became a billionaire going against and zigging and zagging against the crowd. It's worked for him pretty nicely. Just another thought on what's going on.

More after this.


CAVUTO: All right, President Trump is heading to France tomorrow to continue commemorations of the 75th anniversary of D-Day.

FOX News' own Kevin Corke joins me now from Shannon, Ireland, with the latest on that trip -- sir.


Let me tell you, really, just a fantastic opportunity for the president and the first lady. That trip continues here in Ireland, but certainly throughout the last few days, Neil, it has been really something to see.

In particular, I'm looking forward to what may happen tomorrow at Normandy. You and I have had a chance to talk about the commemorations leading up to this incredible moment, D-Day, 1944, June 6.

A chance earlier today, in fact, for the president to celebrate the heroism of who fought on that fateful day, and, of course, the launch of that operation, which happened this day back in 1944, changing not only the war, but, as was perfectly said today, changing the course of human history.


TRUMP: "Almighty God, our sons, pride of our nation, this day, have set upon a mighty endeavor, a struggle to preserve our republic, our religion, and our civilization, and to set free a suffering humanity."


CORKE: President Trump reading there from the prayer offered at the time back in June of 1944 by President Franklin Delano Roosevelt.

Her Majesty, the queen, obviously was also in attendance at all the events. You maybe remember she famously served during the war, learned how to drive a truck. She was a mechanic, believe it or not. Quite a beautiful tribute, not just to her, but to the Greatest Generation.

It all continues in Normandy tomorrow. Of course, we will have live coverage. Probably see the president over there around 5:00 or 6:00 in the morning your time. We will have it for you from here -- but, for now, back to you, Neil.

CAVUTO: I know you're not sleeping, my friend, but great work, Kevin Corke, traveling with the president in Europe right now.

CORKE: Thank you.

CAVUTO: We will have a lot more on this and the implications for investors -- after this.


CAVUTO: All right, those talks with the Mexican foreign secretary, they're still going on in the White House.

But that was interesting, what Ken Fisher saying. This might be an elaborate attempt to get the Mexicans to do something at the border, not with the migrant crush, but simply build a wall. The Mexicans build the wall, and they pay for it. Who knows?

Here's "The Five."

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