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Market turbulence is not over: Polcari

SlateStone Wealth chief strategist Kenny Polcari breaks down the geopolitical uncertainty affecting the market.

This is a rush transcript from "Your World," January 24, 2022. This copy may not be in its final form and may be updated.

CHARLES PAYNE, FOX NEWS ANCHOR: To the showdown with Russia over Ukraine, the U.S. putting 8,500 U.S. troops on heightened alert as NATO dispatches ships and planes to deter a possible Russian invasion.

The State Department telling Americans to get out of Ukraine now. And it all has more investors on edge, as the Dow plunged more than 1,000 points early on in the session, more on this topsy-turvy sell-off to come.

Welcome, everyone. I'm Charles Payne, in for Neil Cavuto. And this is "Your World."

To Jennifer Griffin at the White -- at the Pentagon, rather, with the very latest from there -- Jennifer.

JENNIFER GRIFFIN, FOX NEWS NATIONAL SECURITY CORRESPONDENT: Hi, Charles.

Well, we just left the Pentagon briefing, where Press Secretary John Kirby announced that Defense Secretary Lloyd Austin has ordered a range of active-duty military units here in the United States be placed on heightened preparedness to deploy orders if activated to support NATO's response force.

The troops and their families are being told now that they could be called up in a matter of days.

(BEGIN VIDEO CLIP)

JOHN KIRBY, PENTAGON PRESS SECRETARY: The number of forces that the secretary has placed on heightened alert comes up to about 8,500 personnel.

(END VIDEO CLIP)

GRIFFIN: The troops would be under NATO control under the current supreme allied commander, General Tod Wolters, if requested.

The NATO response force, or NRF, could draw up to 40,000 troops from all NATO allies and placed on NATO's eastern flank as a deterrent to Russia. The Pentagon says those troops would not be going to Ukraine.

(BEGIN VIDEO CLIP)

GRIFFIN: If NATO is a defensive alliance, and these troops, if they're activated, are defensive, and, therefore, front-line NATO states, how does this protect Ukraine? How does it stop Putin from going into Ukraine?

KIRBY: It's designed to reassure our NATO allies, Jen. It's designed to reassure our NATO allies.

And we are taking...

GRIFFIN: How does it protect Ukraine? How does it protect Ukraine?

KIRBY: Jen, it sends a very clear signal to Mr. Putin that we take our responsibilities to NATO seriously.

(END VIDEO CLIP)

GRIFFIN: The troops would not be sent to Ukraine, but they would go to Romania, Poland, Hungary, the Baltics, if asked.

Already, NATO allies began committing heavy equipment, bombers and warships, to the buildup to protect NATO's eastern flank. The Pentagon said today Putin is showing no sign of de-escalating. In fact, he has sent more troops and equipment in recent days to Ukraine's border, according to Kirby.

Now NATO is preparing for what comes next -- Charles.

PAYNE: Jennifer, thank you very much.

So, is all of this enough to deter Russia?

Let's bring in former USS Cole Commander Kirk Lippold.

Commander, listen, we have been here before, right? Immediately, you think of Crimea. You think of how, essentially, Vladimir Putin was able to just walk in and take it, despite all of the hand-wringing and threats? Are we on the cusp of saying something very similar now?

KIRK LIPPOLD, FORMER COMMANDER, USS COLE: I think it's a real possibility, Charles, because, when you look at it, Putin has already shown a propensity for taking land without very much consequence.

He's already in Georgia. He's taken the Crimea. He has aided the rebel forces in the Donbass region in Eastern Ukraine. He's only 525 miles from Moscow to Kiev. So, the bottom line is, he sees no real penalty, and he may be willing to absorb those financial costs, because he would see it as sending a strong signal that: I am not going to have something like a Western capitalist democracy on my western flank that could threaten my ability to rule my country with an iron fist.

PAYNE: There are reports that the Biden administration is saying, hey, your concerns about Ukraine becoming a member of NATO are just premature. It's not going to happen. If it did, it would happen a long time from now.

Just brought up the democracy, because all day long, all weekend long, I'm thinking, why? We understand, Crimea, that it's approximation to the Black Sea, how important it was strategically. Why go through a possible military cost, the personnel and money, and then, of course, the follow-on financial considerations?

What is the main reason, Commander, that Vladimir Putin would want Ukraine?

LIPPOLD: I think he wants Ukraine because it's going to provide him with a buffer state.

Putin has never forgiven Gorbachev for allowing the Soviet Union to dissolve and for all these independent former Soviet satellite states to become independent countries. He sees that as the great downfall of Russia, greater Russia itself. And what he wants to do is try and create the conditions where these countries can once again join in a coalition to build back out, to face off against Europe and be able to maintain that power base there.

And, in reality, that isn't going to happen. Putin as a dictator in that part of the world, it's not a matter of if, but when. Russia is going to be part of a larger community of nations in that area. They're going to eventually have to work together. But it may be decades before they get there because of what Putin is doing today.

PAYNE: So I look at the military forces, a comparison between Ukraine and Russia -- Ukraine and Russia, three million to one million, troops, fighter attack jets, 67 to 1,500, attack helicopters, 34 to 538, tanks, 2,000 to 13,000.

It's pretty obvious they're outmanned. Even with the resources that we have sent, and albeit, a lot of folks believe this administration was late on sending in the proper military equipment, if they decided to go to war, it wouldn't be a very long war, would it?

LIPPOLD: I think the purpose if they go to war is going to move quickly, get into Kiev, knock it down, take the government out, and then back out, which would allow Europe having to rebuild the country, get our government back in place, and do it in a manner that may not appear threatening.

When you look at the NATO alliance, I understand what John Kirby was saying. But here's the bottom line. We have NATO allies today that are not helping NATO in the power projection necessary to try and keep Ukraine safe, principally Germany.

PAYNE: Yes.

LIPPOLD: They cannot be relied upon as a partner.

The Baltic states are terrified that, if we do not show and demonstrate that we are willing to stick up for them under Article V of the NATO treaty that an attack on one is an attack on all, then we're afraid that NATO may in fact start to crack.

And that's also true for Poland, Hungary and Romania. We need to maintain that rock-solid. Germany needs to start stepping up.

PAYNE: Yes, I saw a report today on all the countries that were sending plans, and noticeably absent was Germany, of course, relying on natural gas from Russia, as they shut down nuclear power plants. It just seems like a lot of mistakes on top of each other.

Commander, always a pleasure. Thank you so much. Appreciate it.

LIPPOLD: Thank you, Charles.

PAYNE: So, tensions over there sending stocks whipsawing over here.

At one point, the Dow Jones industrial average was down 1,000 bucks -- 1,000 points rather. Take a look at it now. It made a really amazing comeback. But we're going to have more on your money and where it stands with this crisis as it escalates.

Meanwhile, the Houston police chief naming the suspect in the ambush shooting of a deputy constable. While the manhunt is on, the head of the precinct correctly -- correcting anyone who calls this a -- quote -- "attack." He says it's murder, brutal murder.

He's coming up.

(COMMERCIAL BREAK)

PAYNE: Well, Wall Street investors had their head spinning today.

The Dow at one point was down over 1,000 parts (sic), in part to escalating tensions between Russia and Ukraine, but more so over these worries of inflation, runaway inflation, interest rates ahead of this Federal Reserve meeting on Wednesday. Just not sure what to make of it all.

So we want to bring in one of our favorite go-to money guys, Kenny Polcari, chief wealth strategist at Slatestone.

So, Kenny, let's start with the morning. So, we're down big time. I mean, this market cracks and it looks like classic capitulation. And everyone's kind of making wages on -- wagers, rather, on how low it will go.

KENNY POLCARI, SLATESTONE WEALTH: Sure.

PAYNE: Everyone's moving out of the way.

What was that all about? Was the cherry -- I mean, because there was no new news, per se, although everything else that we have been worried about got worse.

POLCARI: Right.

And so it was some comments out of Goldman and Morgan over the weekend which kind of reiterated the fact that they thought it could get worse than what they originally thought in notes that they put out earlier in the month was number one.

Number two, we do have the Fed meeting, which starts this week. And there's a lot of uncertainty, right, because the Fed has gone into quiet mode now. And they haven't said a word. You haven't heard anything from the Fed in the last couple of days. And so that just kind of sets it up for, well, what are they thinking, which way is it going to go?

And then toss it all the geopolitical stuff, whether it's Russia and Ukraine, whether it's concerns over what China is going to do with Taiwan after the Olympics, or what's happening between Yemen and United Arab Emirates, and that just adds to the fire, right? It adds to the nervousness and the angst.

And so you saw it as we moved into the opening bell. Europe, which was down about 2 percent at 6:00 in the morning, suddenly went down 3 percent just as we were getting ready to open. And, boom, it felt like the bottom was falling out. And it did almost feel like today was going to be a capitulation day.

You say down 1,000 points on the Dow, is that capitulation? Well, in the old days, it might have been.

PAYNE: Sure. Sure.

POLCARI: It really wasn't capitulation yet, right? But it's...

PAYNE: Although, although, Kenny, last year, the worst -- the worst we saw the drawdown for the market -- and I talk really the S&P -- was 5 percent.

POLCARI: Right.

PAYNE: So to see 4 percent across the board today, 14 percent for, I think, the Nasdaq all total, this snowball is quickly becoming a boulder, if you will, and people are getting out of the way.

I think -- what about the -- also the lack of confidence in the ability to fix these things? How much is that weighing on this market?

POLCARI: Well, I think that is weighing on -- I think that is weighing on some investors' minds, which exactly why they're saying, why we're going to stand in front of this moving freight train?

Let me just step aside for a moment, let kind of -- let it happen, what's going to happen, and then I'm going to look at the wreckage and see what stocks got really oversold, what stocks where the story hasn't changed. Where can I find the bargains?

And I think what ended up happening was that, first of all, there's a lot of people that are losing some credibility, some faith that the Fed is Going to be able to fix this, because it seems that they're way behind the eight ball now.

PAYNE: Right. Right.

POLCARI: But one way or the other, look what happened. We traded -- the S&P traded right down to 4222. That's just about where it was in May of '21, right there; 4200 was kind of a level where it was resistance, it tested resistance.

And then it popped through and it became support. And we traded right down there. And when we did, that's kind of when you saw the market start to settle in, and it churned for a little bit. And then they started coming after them, which I think is great, because there was a lot of bargain hunting in there.

PAYNE: Sure. Sure.

POLCARI: But I don't think, by any stretch, it means that the turbulence is over.

PAYNE: No, the turbulence is probably here to stay. It's just about finding a bottom.

So you mentioned the geopolitical situation. We had to Houthi situation last week. That helped spike crude oil prices higher. They settled down a little bit today, but let's face it. It feels like gasoline is going to go a whole lot higher, that the oil part of this story, particularly when you look at the players from Russia, to Iran belligerence, to now to the Houthi rebels attacking the United Arab Emirates, are we talking $100 crude?

Are we talking much higher gasoline prices?

POLCARI: Well, I think we're talking higher gasoline prices.

I think J.P. Morgan came out and already put a $150 target on it. They said if Russia invades Ukraine, they expect oil to go to $150. So that clearly means gas prices are going higher.

One way or the other, whether or not Russia invades Ukraine, I still think demand is so strong that gas prices are going to go higher. And don't forget, the United States and the Northern Hemisphere is now coming out of -- we will be coming out of winter into spring and summer, the whole summer driving season.

PAYNE: Yes.

POLCARI: So I think demand is going to be up, especially that we're getting through this Omicron, and people are dying to get out.

PAYNE: Yes, it's too bad we don't drill -- allow our country -- companies to drill more. We got so much.

But, Kenny, we got to leave it there. Thank you so much.

(CROSSTALK)

(LAUGHTER)

PAYNE: Thank you so much, my friend.

POLCARI: See you.

PAYNE: Meanwhile, folks, a manhunt under way in Texas after a deputy constable is shot dead during a traffic stop. Houston police releasing a photo of the suspect and asking for help.

The head of the precinct is here.

(BEGIN VIDEO CLIP)

TED HEAP, HARRIS COUNTY, TEXAS, PRECINCT 5 CONSTABLE: These are not assaults. These are not attacks. These are brutal, brutal murders.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

PAYNE: Another child caught in the crossfire of surging, senseless violence.

Coming up, a Chicago pastor who says the city's leaders are not doing enough to stop it.

We're back with him in 60 seconds.

(COMMERCIAL BREAK)

PAYNE: Hundreds of NYPD officers lining the streets of New York City Sunday to mourn the loss of one or their own; 22-year-old Jason Rivera was killed in the line of duty Friday during an ambush shooting in Harlem.

His partner, Wilbert Mora, was shot in the head and is fighting for his life in a hospital.

Now to Texas, to a Texas manhunt. A suspect has been named after a Houston deputy was shot and killed during a traffic stop Sunday. We will be speaking to Harris County Constable Ted Heap in just a moment.

But first to FOX News senior correspondent Casey Stegall on the manhunt that's now under way -- Casey.

CASEY STEGALL, FOX NEWS CORRESPONDENT: Yes.

And, Charles, Houston police say that they now know who killed one of the city's constables over the weekend. This is a big development. and they say they're closing in on him, but first more on the backstory.

It was early Sunday morning when Corporal Charles Galloway was initiating a traffic stop in the southwest part of Houston. When the white Toyota Avalon he pulled over came to a stop, authorities say the driver hopped out and opened fire on the constable still inside his vehicle.

The driver, who was justified, is 51-year-old Oscar Rosales, this man, then fled the scene. And a manhunt for him is still currently under way. We can tell you that they have recovered the Toyota and they have also arrested two family members, charging them with tampering with evidence.

Here is the city's police chief not long ago. Listen.

(BEGIN VIDEO CLIP)

TROY FINNER, HOUSTON, TEXAS, POLICE CHIEF: We have video evidence of him shooting our constable. And I want everybody to get into the fight of finding him.

This is our community.

(END VIDEO CLIP)

STEGALL: Officials say there was nothing they could really do, sadly, for Corporal Charles Galloway, who died at the scene.

Federal law enforcement gathering at the hospital to pay their respects as the ambulance carrying the body of their comrade passed by.

Corporal Galloway's car riddled with bullets. Once the daylight came up, you can see parked there the windshield just blown out. The 47-year-old had been with the constable's office, that particular precinct, for more than 12 years. And despite his seniority, listen to this, he volunteered to work the night shift just so that he could help train new recruits.

He volunteered to do that shift, not too desirable. He survives by a daughter and a sister -- Charles.

PAYNE: Casey, thank you very much.

STEGALL: Sure.

PAYNE: I want to get right to my next guest, Harris County Precinct Constable Ted Heap

Constable, what can you tell us first about the search for the shooter? How's that going so far?

HEAP: Well, Charles, currently, as we just released in a press conference, the shooter has been identified. He is still at large.

But we're to the point now to where, by bringing in the public, we feel that we're going to be able to close that net around him relatively shortly, with the Houston Police Department that is leading this investigation, which is enabling me to be able to spend time with the family and be able to grieve with the men and women of this department here.

But I'm very confident that we're going to have this thing wrapped up very shortly.

PAYNE: This constable, as we heard from Casey Stegall, was committed to not just doing his job, but making sure his fellow -- his fellow officers had their proper training by taking this particular shift and training younger officers.

What's his family saying to you right now? You have visited with them. What are they saying?

HEAP: Well, his family, like -- as you could expect, is grieving. This is a horrible thing.

And they are just very, very thankful that the family in blue, the police department across Harris County, across the city of Houston, I have had -- been in contact with the federal authorities, with our state authorities, with the governor, Abbott, of Texas. Everybody is joining together. This man will not escape.

And because of that, they feel confident in the fact that there will be justice for their loved ones. Right now, they are definitely grieving and were just trying to pull together as a family, because this was a horrific, horrific scene. It was nothing short of an execution.

PAYNE: Constable, you were very blunt about this being a murder -- quote - - "brutal murder."

And I felt -- I mean, I think a lot of people probably do -- that you weren't just talking about this incident in particular, but the need to start talking about these things in real terms, so that maybe some real things can curb these actions, because, as a citizen, I feel the police are never given the proper respect by the media with respect to the dangers they go through every single day.

We hear about SUV violence. We hear about gun violence. No, this is human being violence. And it's being perpetrated against the people that keep us safe. What was going through your mind? Why was it so important for you to be so blunt?

HEAP: Charles, I have lived this for almost going on four decades.

I have seen -- I have seen our communities change. I have seen the disregard for human life and how that has become more prevalent. And I'm no different than anybody else. I'm a father and a grandfather. And I want to be able to raise my children and see my grandchildren raised in a community that is safe.

And, right now, that is not the case. We need to be able to unite together and to say, as the public, to say, as the people who elect our officials, that this is no longer acceptable, that we will no longer tolerate this. And we need -- we understand in law enforcement that 98 percent of the people support us.

PAYNE: Right.

HEAP: But it's the 2 percent, it's the 2 percent that make it so difficult. It's not a job that's easy.

PAYNE: Yes, they make it difficult for their entire -- all the communities, not just the police.

I got less than a minute, but I just -- and I don't want to let you go. But I'm reading where there were 120 deaths in the line of duty. And what strikes me from this list, there's a dozen ways that police officers in Houston were killed or died in the line of duty, and just only 73 were gunfire.

You had automobile crashes. You have vehicular assault. Just -- I just gives you a sense of the risk that the men and women in blue go through every day. I will give you the final word.

HEAP: You are so correct.

We -- unfortunately, we just experienced a death of a sergeant with our sheriff's department last night. It's just one on top of another. And this is by a suspected individual who was driving while intoxicated. So I mean, whether or not you're trying to direct traffic, whether or not you're just trying to execute a traffic stop, or responding to a family violence call, the threat is out there.

PAYNE: Yes.

HEAP: And these officers know it. And they still go into this job to protect the public that they live in.

PAYNE: Constable, we grieve with you and the family. Let them know that. And we appreciate you and really what you do and what your fellow officers do for us every day. Thank you.

HEAP: Thank you, Charles.

PAYNE: Peter Doocy pressing White House spokesperson Jen Psaki on this crime crisis. He's coming up.

Plus:

(BEGIN VIDEO CLIP)

COREY BROOKS, FOUNDER AND PASTOR, NEW BEGINNINGS CHURCH: How many more will it take before our leaders wake up? You know what? They will never wake up. You know why? They don't care.

But we do.

(END VIDEO CLIP)

PAYNE: A Chicago pastor sounding off after an 8-year-old girl was shot in the head, the latest in a string of children shot to death there.

That pastor is here.

And Ukraine calling our State Department's move to evacuate U.S. citizens premature. So, what is the State Department saying?

We will have the latest.

(COMMERCIAL BREAK)

PAYNE: As crime surges, children are getting caught in the crossfire.

In Chicago 8-year-old Melissa Ortega was killed over the weekend after being hit by a stray bullet.

My next guest says the city's leaders are not doing enough to stop it.

New beginnings Church Senior Pastor Corey Brooks joins me now.

By the way, we have reached out to Mayor Lori Lightfoot to join the show. She is -- she was unavailable.

Pastor, thanks for joining us.

BROOKS: Thank you.

PAYNE: Chicago, the murders, we have been talking about this for well over a decade, the story. It seems to get worse every year.

You're in the heart of it. What's going on there?

BROOKS: Well, we continue to see rampant hardness, wickedness and criminals taking possession of everything that they can.

It seems like everything is out of control in our city. And it's unfortunate. We have a very beautiful city. But that's why I'm on the roof doing this protest, because I want to bring as much attention and awareness that I can about the violence in Chicago, until we do something about it.

And it all starts with leadership. Everything rises and falls on leadership. So we have to do a much better job if we're going to control the violence that's going on in our city.

PAYNE: What would you like to see from leadership?

BROOKS: Well, one, we have to get these individuals who are likely to be shot or likely to be shooters. And we definitely need to get them alternatives and opportunities for those who want to accept them.

For those who don't want to accept them. Unfortunately, they need to be locked up and put away. We have a lot of criminals who are on the string, a lot of serial killers who are on the street who are perpetuating violence in our community every single day.

And now we see again children being shot and killed. Last week, we had six children being shot and killed. And if that went on in any other community, it would be total outrage.

But this is the type of chaos that we're seeing every single day in Chicago. And now we see it with an 8-year-old girl being shot and killed.

PAYNE: Pastor, what do you -- why has it -- why is it the popular conventional thing now is to have so much sympathy for the criminals?

We all have sympathy for people who grow up against the odds and are -- have more hurdles to clear. But these sort of criminals who are like career criminals, they have been in out of jail nine, 10, 12 times, they have a rap sheet as long as a 10-story building, why are there always so many efforts to let them out of jail, so they don't have to post bail, these kinds of things, and they wreak havoc, deadly havoc on these communities that purportedly the folks who feel bad for them are supposedly trying to keep safe?

BROOKS: I believe that some of the protests by some of the organizations that claim that they're trying to help black community have added to the fact that you have a lot of those who are in the legal profession, especially like prosecutors, who don't want to prosecute to the fullest extent, because they feel as if they're going to be protested, they feel as if they're going to lose votes.

And those who claim to be helping the black community, it's very unfortunate that their protests, their propaganda is doing nothing but crippling us, because we're the ones who have to continue to live in these communities and deal with the criminals every single day.

But the truth of the matter is that someone needs to make sure that these criminals are prosecuted and taken off our streets in the city of Chicago. And we need to do that, and we need to do it now.

PAYNE: Yes, and I would add to that they have to be kept off the streets, because I have seen when I -- I listen, I grew up in Harlem.

I would see people commit assault, knife, gun, anything, and, a year later and six months later, they're back on the street. So you're never going to tell the police, you are never going to cooperate with the police if that's the situation. You just live in fear all the time.

I want to point out your rooftop protest here, because this is how you initially rose to prominence. You had a 94-day protest against a rundown motel that was being used for all kinds of crazy things. They have torn it down. They're going to make a $23 million state-of-the-art community center.

So, you have been there. You have done amazing things already. How is this galvanizing the community? How many people are behind you? And can we grow this?

BROOKS: Yes, we have a whole community behind us. But not only do we have a whole community. We have a city and we have a country behind us, people from all across the country.

Thanks to FOX, we have been able to get a platform so that we can express our point of views. And we're on "Rooftop Revelations" every single day. And because of that, people have gone to projecthood.org. And they have given. They have supported. They have sent letters.

And it's happening not just across the country, but our city is really behind it and our neighborhood is really behind it, because we know that we need it in this community to transform it from being called Old Block named after a gang member to change again to Opportunity Block.

That's what needs to happen in this very dangerous corner of the city that we live in.

PAYNE: Pastor Brooks, thank you so much. Keep up the good work, and we will check on you again. Thank you so much. God bless you.

BROOKS: Thank you. Thank you. God bless you.

PAYNE: So, some heat at the White House briefing today, with our own Peter Doocy pressing Jen Psaki on the president's action on this crime.

Peter joins us now. He's at the White House with the very latest.

Peter, had a little bit of ruckus, huh?

PETER DOOCY, FOX NEWS WHITE HOUSE CORRESPONDENT: Well, you will see the clip here in a second, Charles.

And a lot of Biden officials lately have been trying to focus on voting legislation. But we have got this new FOX News poll that shows that voting rights legislation, voter suppression are near the bottom of things that people actually care about.

Inflation and crime are at the top. And over the weekend. We even heard Democratic members of Congress talking about that. But here at the White House, where the president has talked about the pandemic 10 times more often than he has talked about crime, officials are starting to blame the rising crime on guns and COVID.

And there is no plan to start doing things any differently.

(BEGIN VIDEO CLIP)

DOOCY: The murder rate here is a 25-year high. Would he consider maybe trying something different?

JEN PSAKI, WHITE HOUSE PRESS SECRETARY: Trying something other than supporting in massive plus-up in funding from his predecessor, cracking down on gun trafficking and gun violence, which is a major driver of the violence we have seen across the country, working to support community policing programs and police departments across the country?

I think most people who want to fight crime would agree that's the right approach.

(END VIDEO CLIP)

DOOCY: So they are basically saying that they think crime was on the rise when they took over, and they have no plans to change the crime fighting strategy that they put in place when they took over, even though the violent crime and the murder rates are trending upwards.

We do expect to hear from the president about 20 minutes from right now. It's unclear if it's going to come up or if he's just going to focus on what they say he will, which is rising prices and inflation -- Charles.

PAYNE: Right.

Peter, I think people who are victims of this don't care who's responsible. They just want a solution. Forget the finger-pointing at this point, right?

DOOCY: And, Charles, there's been so much focus on crime -- or, rather, on COVID from this administration because of the risk that it presents and has presented to the American public.

Well, crime and murder presents a risk to the American people as well. We just have not seen the president spend nearly enough -- nearly as much time on crime as he has on COVID.

PAYNE: It's true.

Peter Doocy, thank you so much.

Meanwhile, folks, Ukraine ripping the State Department for urging U.S. citizens to evacuate there. How is the State Department responding?

In the meantime, inflation soaring. President Joe Biden minutes away from a meeting focused on lowering prices, but are more government moves really the right answer?

(COMMERCIAL BREAK)

PAYNE: The State Department today doubling down on its embassy drawdown, after Ukraine called the move -- quote -- "premature" and an act of excessive caution.

FOX News' Benjamin Hall has the very latest from the State Department -- Benjamin.

BENJAMIN HALL, FOX NEWS CORRESPONDENT: A fair amount of criticism now about the decision to draw U.S. Embassy staff out of the embassy at Kiev, the E.U. calling it a step too far, the Ukrainians saying that it was effective really instilling the kind of fear and panic that Putin himself wanted to instill.

Nevertheless, they are going ahead with it, drawing down nonessential staff, as well as all family members who are in Kiev, and they're placing a do-not-travel warning on the country. They also continue to say that they do not know how many Americans are in the country.

(BEGIN VIDEO CLIP)

NED PRICE, STATE DEPARTMENT SPOKESMAN: No, we do not have an account that we consider to be accurate of the number of Americans, private Americans, who are resident in Ukraine.

(END VIDEO CLIP)

HALL: Senior State Department officials continue to insist they don't know either whether Putin plans to invade, but that he is ready to do so. And if that happened, they say, the U.S. would be unable to evacuate and save its own citizens.

They have also said they have warned Russia about threats towards Americans.

(BEGIN VIDEO CLIP)

PRICE: We have made it abundantly clear to the Russians the priority we attach to the safety and security of the American people.

(END VIDEO CLIP)

HALL: The U.S. did deliver around 80 tons of weapons to Ukraine over the weekend, totaling about $200 million. They say more will arrive in the weeks to come.

But it is not the hardware that Ukraine say they need so badly, which are air and missile defenses.

Charles, it's not hard to be reminded of Afghanistan when you hear the State Department saying they don't know how many Americans are in country, they won't be able to get them out in the eventuality of an invasion. What the State Department is doing, they say, is acting in an abundance of caution, rather than acting when it is too late.

But, as you pointed out, there are countries now who are saying this was the wrong move at a time when the U.S. needs to be showing its strength -- Charles.

PAYNE: Benjamin, great points.

With that, I would like to bring in -- by the way, the State Department is reiterating today that diplomacy is the best way forward, but many are wondering if it's too late.

I want the get to read on all of this from former State Department official Christian Whiton.

Christian, you have served several administrations. You understand this better than anyone else. Is this the right move right now? It's sort of interesting that Ukraine would be critical of it.

CHRISTIAN WHITON, FORMER U.S. DEPUTY SPECIAL ENVOY: Yes, I don't think it is the right move at this point, because, as you mentioned, as your reporter mentioned, Afghanistan just happening, U.S. citizens in Ukraine aren't really looking to the U.S. government for a lot of wisdom on whether or not to get out.

By removing family members of diplomats by suggesting, that other Americans leave the entire country, not just the Eastern part that would be the most likely focus of Russian action, I think it does send a signal of panic and weakness.

PAYNE: Does it also sort of say, hey, if something were to happen, again, going back to botched retreat from Afghanistan, that, if something were to happen, we already told you we didn't know, we don't have any idea?

Because they were under heavy criticism for not having that information during that retreat.

WHITON: It is sounding a little bit like that, especially since Ned Price, the spokesman, didn't say we have imperfect information who's in the country, therefore, go to this Web site and register. And the State Department does have that capability.

So, yes, I think they're trying to basically preemptively sort of insure themselves against criticism.

PAYNE: Christian, Ukraine saying, money is fine right now, but we need hardware.

Just how much hardware do they need? I mean, I'm hearing and reading where a lot of folks are saying it's actually too late to get them all of the resources that they would need.

WHITON: It's far too late.

Russia has a military of one million people. This isn't Grenada. It's not Panama. It's not Iraq in 1991 or in 2003, very serious nuclear-armed country, a million people under arms, and the ability to go up to close to three million if they need so.

So, frankly, sending the entire expeditionary force of the U.S. military probably would be insufficient. And this is a real problem throughout this crisis. The idea of fighting in Eastern Ukraine or fighting in the Black Sea, where we have very limited ability to project power, seems not to have occurred to our national security bureaucracy.

And that's a very dangerous development.

PAYNE: Well, I know.

What do you make of the United States having 8,500 troops prepared? What would they do? What would their role be, by the way?

WHITON: You know, I think the White House thinks it's engaging and clever and nuanced saber-rattling, signaling allies of our reassurance. That's what they're telling people.

In reality, it's sort of a joke, 8,500 guys against a million man army. And it's the Russians, the nuclear-armed Russians, the Russians with a lot of heavy material, heavy tanks. And if you look at NATO, it's not unified. And NATO knows it's not unified. The Germans have already said they're not going along with some of the strongest sanctions that the U.S. might want.

Spain, Greece, Italy, these are other NATO members that have no interest in fighting Russia.

PAYNE: Yes.

Christian Whiton, thank you very much. Appreciate it.

WHITON: Thank you, Charles.

PAYNE: All right, so, with prices going up, President Joe Biden about to hold a meeting on ways to bring them down, but will any of this stop those polls from dropping down?

(COMMERCIAL BREAK)

PAYNE: You're looking live at the White House, President Biden getting ready to -- for a meeting on how to deal with inflation that just won't go away.

And according to a new FOX poll, more than 40 percent of Americans think the price spikes won't be going away for at least another year.

So, let's get the read on this from FOX Business' Susan Li and economist Steve Moore.

Susan -- and it's not just the FOX poll, right? Other polls suggest this could linger for even years.

SUSAN LI, FOX NEWS CORRESPONDENT: Yes, that's right.

Inflation and also moderating growth is now pushing the Federal Reserve to really thread the needle. And you saw that today with Wall Street, the worst start to the new year in 90 years for stocks here, Charles. And most people think that, look, the Fed clearly behind the curve when it comes to tackling inflation, has to get more aggressive.

So, they're pricing in maybe four or even five rate hikes this year. And that's why you have seen depressed trading so far. We're down 10 percent, in correction territory, on the broader S&P.

PAYNE: Right. But, Steve, that's the conundrum.

STEPHEN MOORE, FORMER DONALD TRUMP CAMPAIGN ADVISER: That's right.

PAYNE: They have waited so long, do they have to push the economy over the edge in order to save it?

MOORE: Exactly. You took the roared right out of my mouth. Conundrum, it is.

And you're starting to see some signs of the economy slowing down. I would describe the economy right now as wobbly. And you're seeing this in terms of the increase in the unemployment insurance claims that reversed six weeks of -- six months of gains in terms of reducing the number of unemployed. That number went up last month.

Then you're seeing the retail sales numbers have been kind of disappointing and industrial production, so the economy showing some signs of weakness right now.

And exactly to the point that you all were just making,that now you raise rates in that kind of environment, it is -- I wouldn't want to be on the Federal Reserve Board right now.

But I want to make one other quick point, because you just did a great analysis of what's going on in Ukraine, Charles. And come on. Somebody's got to explain to me, Charles, why we're not producing more American oil, gas here in the United States. By withdrawing U.S. production, we're only further empowering Putin in Russia, who is now the number one producer of natural gas.

And we have way more of it than he does.

PAYNE: Yes. And we can ship it at a cheaper price.

MOORE: Exactly.

PAYNE: Our liquid natural gas industry is ready to take off in a big, big way.

MOORE: Exactly.

PAYNE: And we could dominate the world. It's amazing that we have declared war on fossil fuels, and now we're hurting ourselves. And we have exacerbated that situation.

I want to ask you guys about the administration coming to the rescue for truckers. As part of the new infrastructure bill, they put out a 2,300 page report, 2,300 pages. Now, here's the thing, Steve. Of all the problems that truckers deal with, number two by far is parking. If they can't park their rigs, they can't make the drop-off. They can't get the products.

Nowhere in the 2,300 pages is the word parking, nowhere in there.

(LAUGHTER)

PAYNE: This is an administration, I guess they were having margaritas. They must not have bothered to ask a trucker, Steve.

MOORE: Yes, gee, I thought that Pete Buttigieg was on the case here and he was going to solve these problems.

(LAUGHTER)

MOORE: Of course, he doesn't know anything about trucking.

Look, being a trucker is a tough job. We have a shortage of somewhere between 10,000 and 30,000 truckers across the country. They are the people who bring the food to our shelves. I got to tell you that supply chain problem is real, Charles.

I -- my wife and I went out a couple nights ago get milk at the grocery store. No milk. No eggs. Half of the aisles were just no merchandise.

PAYNE: Yes.

MOORE: This is a real problem. We need those truckers getting that merchandise on the shelves in the stores.

PAYNE: Susan, the apparently ,according to the most recent survey, almost 90 percent of these truckers admit that they have to park somewhere that's unauthorized at some point.

(LAUGHTER)

PAYNE: I mean, think about this.

LI: Yes.

PAYNE: We're talking about setting up electric gas charging stations and all these things.

How come no one thought about that? This is the arteries. They bring us life. And here we are. I mean, who put this plan together, Susan?

LI: Yes.

You put $8 billion in the pockets of electric car makers, but you can't get truckers some parking spots. And it's interesting how their hours work. So they drive for 11, rest for 10. That's pretty much how I work as well.

But I want to talk about female drivers. I was just looking at the statistics. We need to get more than 8 percent of women in trucking. Don't you think that statistic needs to improve? And maybe that means more trucks on the roads as well.

PAYNE: More trucks. We can have a place to park them.

OK, the market was all over the place today, Steve. It seems like dual messages, one, concerned about this inflation problem. You brought up the Fed. But also maybe it's just a sort of oversold.

What's the likelihood that we should be watching this market now sort of as a barometer? I think it sent us a shockwave we should pay attention to today.

MOORE: So it's a great question. And I would say this, that I lived through the 1970s. I think you did too.

And the '70s was like the worst decade since the 1930s for the stock market. You're a little younger than I am, Charles.

But my point is...

PAYNE: I was playing basketball, but I understand.

(LAUGHTER)

MOORE: My point is, though, that there's this mythology on the street that somehow high inflation, well, in the short term, it increases profits, right.

But in the long and medium term, inflation is not just bad for consumers. It's bad for stocks as well.

PAYNE: You know, Susan, over the weekend, I saw a thread by Kellogg's.

They ran out of everything, right? So...

(LAUGHTER)

LI: Right.

PAYNE: And it's just -- to Steve's point, though, every store is out of everything.

How do you fix something like this? How do they turn something like this around?

LI: Yes.

And don't forget McDonald's and Starbucks are cutting back their hours. So you can't go to the drive-through at midnight if you have those french fry cravings. But you talked about Kellogg's. I will tell you this.

Companies like Kellogg's, for instance, like the other consumer brands, like Procter & Gamble, that's able to raise prices in this inflationary environment, they have been rewarded by the stock market. So inflation shortages are helping companies that have pricing power, maybe like Kellogg's and definitely at P&G this year.

PAYNE: There's no doubt about it, Procter & Gamble one of the biggest -- biggest winners out there.

By the way, I want to let everyone know we did reach out to Kellogg's for a statement. They provided one. I want to share it with you.

"Balancing supply and demand has been a consistent theme across consumer good manufacturing and retail since the pandemic began in March of 2020. Throughout this time, we have seen higher at-home consumption and increased demand for our beloved and trusted brands," including Frosted Flakes. That's me.

(LAUGHTER)

PAYNE: And they have said they have experienced some challenges with the entire food chain -- supply chain.

MOORE: You're a Tony the Tiger guy, right?

PAYNE: Yes, yes.

So, listen, they're also going on to say that this is affecting every community and that, of course, they are always looking out for their shoppers as best they can.

MOORE: Yes.

PAYNE: And it's going to be persistent. It's just one of these issues.

Susan, Steve, thank you both very much. Really appreciate it.

Also, folks, you got to watch tomorrow me on "Making Money." It really was a crazy day in the market today, one of the wildest I have seen, sort of like those football games over the weekend.

And now "The Five" starts.

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