gregg: that will do it for us. "happening now" begins right now. have a great day. everyone. heather: we hope you had a great holiday weekend with your family and see you the rest of the week. i will be back tomorrow. bye. jon: we begin with this fox news alert out of compton, california. this is one of those rare ones, the kttv chopper was flying from one assignment to another and saw an ominous cloud of smoke there in compton, california. probably getting this house fire, to this house fire even before the fire department did. no word on whether there are any injuries yet. firefighters, you can see, just making entry into this one-story home in compton, california that is burning right now. it is that time of year when, you know, because of christmas trees and candles burning and auld kinds of holiday festivities, you wind up with far too many house fires. chimney fires, that kind of thing. but that is what is going on

in compton, california. we'll try to keep an eye on it. let you know whether this family made it out okay. good morning to you, on this day after christmas. all eyes are on iowa as we count town to the caulk can yous. good morning, i'm jon scott. >> will be there before you know it. jon: a week and a day. >> great to be with you. i'm jamie colby in for jenna lee republican candidates gearinging up for all-out blitz. they tway to sway caucus voters and right now the race looks very close. chief political correspondent carl cameron is live in des moines. great to see you. there is so much talk, carl, about organization. how important is it there for the caucuss?.

>> reporter: it is probably the premier and most important aspect to the campaign itself. for the last couple weeks the candidates have been busing all over iowa trying to do the type of retail politics frankly hasn't occurred this time really in years. historic lack of repail campaigning. which is to say hand-to-hand, small restaurants and knocking on doors to meet with voters. give you an idea what will happen week from tomorrow, the caucuses are not like any election. they only start at 7:00 at night. it is inside republican party event. there will be 1700 precinct locations across iowa that aren't at the normal places in many cases where votes are cast. they can sometimes be in alternative venues, and caucus-goers will have to go, listen to some speeches from the very, on behalf of the various different candidates and do write-in al lots. it is a much different process. it is much more laborious. that is why the candidates have been out on the bus tours last couple weeks and will be starting tomorrow. they're not here now because of the christmas holiday and

haven't been for a while. best example aftra additional campaign is what mike huckabee did in 2008. he came full year-and-a-half before caucuses in iowa, busing all over the hawkeye state. small intimate groups. he develop ad massive e-mail list of evangelical christians across the state. at one point he had 420,000 people on his e-mail list. his aides said there were 15 million e-mails sent across iowa with a state only three million. nobody is doing anything like that this time. even the candidates who ramped up retail politic last few weeks haven't been doing that if anybody has, the it has been rick santorum the expense vain senator. he has been to every county here and virtually moved in with his family last summer. he hasn't shown up in the polls. latest average of polls taken by "real clear politics" shows ron paul leads. mitt romney is second although it is a statistical tie and newt gingrich is in

third place. rick santorum, michele bachmann, rick perry the folks on the bus trips all over iowa last few weeks, don't even show up breaking barely double digits. it is an indictment really of lack of retail politic and could profundly affect these campaigns. >> i know jon huntsman is focusing on new hampshire. if ron paul has been speculated and that poll certainly shows it is a possibility. if he wins in iowa, how would that affect the race, carl? >> well, really speaks to a dissatisfaction in the republican party. ron paul's determination. this is his third presidential run. he had has been running lots of ads in iowa. he has a great fund-raising appat russ -- apparatus. coined the term money bomb with his fund-raising abilities. he has been very aggressive in getting them ready to rock for the caucuses he has lots of seniors because his domestic message does appeal. the stop spending message really works well with fiscal conservatives in iowa.

his foreign policy has hurt him but ron paul is very definitely a factor. newt gingrich does not have the kind of organization that can compete in iowa. in fact, gingrich and virtually every other candidate with the exception of ron paul and mitt romney failed over the last few days to make it onto the virginia ballot to compete in its primary later in the year that will come on super tuesday in march. so only ron paul and mitt romney appear to have the types of organizations that can compete nationally. that appear in state after state after state. virtual all the others have not only been unable to qualify for the ballot in virginia but even here in iowa where organization is so important, they have not been able to generate the type of support that is historically important to win here. it does suggest that ron paul could have a big day. perhaps rick santorum could surprise coming from back out of the pack. he worked it in a traditional fashion. mitt romney saying all this year he didn't want to compete that aggressively in

iowa. he would compete but not necessarily to win. iowa caucus-goers don't like to hear that attitude. they believe they have a obligation to come here and compete and lay out their ideas. it is believed iowa caucus-goers will give us a big surprise come week from tomorrow. jamie: a lot will be learned in terms of campaign style and strategy. carl, great to see you today. >> reporter: you bet. jon: for more on the iowa caucuses we're joined by david drucker, report staff writer at roll call magazine. the report we're hearing from one republican organizer said in a normal years the voters in iowa like to meet the candidates face-to-face several times before making a decision. the complaint this year they have hardly met some of them at all. >> well, that's correct. and i think that part of the reason for that is that this race has been so defined by the debates and national polls, i think a lot of candidates also did not want to put all of their chips on

iowa, compete hard there, lose and then be defined going forward as somebody who couldn't get it done. i saw people like jon huntsman, they're rolling all the chips on new hampshire. you saw other candidates competing in other states, even ones that came much later because they were hoping that a large national following would sort of influence the early states. and, you know, i also think it is a function of money. not everybody has the money to be everywhere and so they have had to make choices. the clearly this isn't like 2008 or even 2000 for republicans in the sense that iowa has not been treated the same as it has in the past and i'm wondering if some of it has to do with the fact that john mccain won the nomination four years ago and he didn't compete in iowa at all. jon: this time around you don't have a democratic race. last time around you had hillary clinton and barack obama shrugging it out in iowa. that helps ramp up voter interest, doesn't it, when

you have both parties actively participating? >> well it can but i think the interesting thing is if you're a democrat and you're looking at 08 you would look at the fact that obama pretty much launched his campaign with a victory in iowa. so iowa was he can dreamly poorn in '08 on the democratic said not so much on the republican side. mike huckabee won iowa, didn't do him any good going forward not even south carolina a southern state, where one would have thought he would continue his roll. i think it depends on the parties. jon: let me ask about that. didn't huckabee win, didn't he ultimately when all of the delegates counted didn't he finish second to john mccain, slightly ahead of mitt romney. >> yeah he did but he didn't win the nomination. when you're look at what states to compete in and how important it is what matters is winning the nomination. second place is just as good as fifth place at the end of the day. jon: i guess you're right about that. so you've got the candidates,

they spent a fairly quiet weekend. they took the attack ads off the air. now with a week and a day to go i suppose there will be a blizzard of that kind of television advertising to try to get these undecided voters to make up their mind because there is a huge percentage of iowa caucus-goers who have not yet announced a position, right? >> that's correct. and i think what is interesting about the you can caucuses all the voting is done on one day and it's done in the evening. unlike a lot of states and traditional elections where you have a lot of early voting, a lot of absentee voting and by now so many people would have made up their mind one way or another and would have voted and they're off the table everybody is still up for grabs and i think you will see some real tough campaigning down the stretch because it is for the first vote. it is a little odd because we're in the midst of a holiday week with bowl games and sports and new year's eve but i think

in iowa the competition will be generally pretty fierce. there is lot at stake whether you're ron paul or newt gingrich or rick perry, even mitt romney if he can finish second or third, at least a strong third and not second he goes into new hampshire with a lot of momentum. if ron paul wins, newt gingrich wins, clearly they have a lot of momentum. if somebody comes back from the pack, governor perry or rick santorum or michele bachmann and finish jonger than people thought they're still in the game. there is a still a let at stake even though iowa hasn't had as much attention by the candidates as it has traditionally. jon: we're almost into 2012 which is the year the election will be actually held in. interesting to watch the thing developing seems like past three years ever since the president was elected. david drucker from "roll call." thank you. >> thank you. jamie: the united nations and the iraqi government agreeing to relocate more than 3,000 iranian exiles. they're living in a camp in northeast iraq. the group is known as mek,

or the people's mujahadeen organization and they're committed to the overthrow of the iranian regime. washington considered them a terror group for 15 years despite rather claims that the mek actually aided the boost with key intelligence on iran's nuclear program. very interesting to learn about this. national security correspondent jennifer griffin live in washington with more. jennifer, did we know about them for a long time? >> reporter: we have actually. this is a group of iranian dissidents who have been based in iraq since the 1980s. i first went to their camp in 1995. saddam hussein gave them protection because they were fighting the mullahs in iran. after saddam fell the iranians have been trying to push the iraqi government to push them out which led to violence against the camp. this is the complicated group. technically they are still on the state department terror list because they allegedly killed six americans during the shah's era in tehran but they also helped the u.s. and western

intelligence agencies as you mentioned. in recent years they were the ones who provided key intelligence break through about the secret uranium enrichment facility in natanz, a key intelligence break through for the west. iran is so threatened by them, jamie, when an agreement was rumored in certain days, iran quds force reportedly fired these rockets at their camp in iraq. they are feeling great dell pressure and vulnerable at their camp. jamie: i would imagine. what does the u.s. have to do with this? what is your responsibility, jennifer? >> reporter: essentially because when the u.s. invaded iraq and toppled saddam hussein a senior u.s. general met with them and got them to agree to disarm in checks for u.s. protection. the u.s. state department complicated matters by not taking them off the u.s. state terrorist list which makes it hard for them to be resettled outside of iraq. the u.s. military wiped their hands of them after the status of forces agreement was signed with the iraqies in 2009 and now

with the subsequent withdrawal of u.s. troops. >> the united states general gave a guarantee in 2003 when we invaded iraq and they surrendered their arms, heavy arms and light arms, they could have used to defend themselves, we gave them a guarantee that they would be treated as protected persons. >> we asked a group of people to disarm themselves, to give, give away, surrender their capability of defending themselves and in exchange for that we promised them, we made a commitment that we would provide for their safety and security. >> reporter: without u.s. help these 303400 iranian dissidents argue they could be killed. jamie. jamie: jennifer, good to see you. jon: a country many of the 9/11 hijackers came from may be closer to getting its hands on nuclear weapons. we're live with that story.

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>> right now some new information on a few stories we're watching for you. fire officials in samford, connect kit, say it may be days before they know the cause of a terrible fire that killed five people on christmas. three little girls and their grandparents died. the children's mother and a friend, the only survivors. pope ben dingt the -- benedict the 16th denouncing the coming of a in a catholic church in nigeria. islamic extremists claim responsibility for setting off a bomb. the pope says only respect and reconciliation can bring peace, not violence. the u.s. considering whether to allow yemen's outgoing president into our country i should say for medical treatment. president saleh is requesting special treatment here for injuries he suffered during a terrorist attack on his presidential compound. jamie: meanwhile there's new

information on saudi arabia's nuclear ambitions. the former head of intelligence saying the oil-rich nation is seriously considering getting its hands on nuclear weapons to keep up with rival val iran. this of course is fueling proliferation concerns. how could it not? david lee miller following that for us live in new york. david lee? >> reporter: jamie, iran's war games this week near the entrance to the red sea are being very closely watched by its neighbors especially regional rivals saudi arabia. there is as you mentioned growing concern about a nuclear arms race between the two countries. saudi arabia's former u.s. ambassador who also served as his country's intelligence chief earlier this month warned that the kingdom might pursue nuclear weapons to protect itself from long-time adversaries iran and israel yet it is iran's expected push to develop nuclear weapons which many analysts believe could have disasterous consequences. >> if the obama administration fails to stop the iranian bomb and so far

all indicate that we are failing, we're not stopping neither the missiles nor the penetration of iraq and other places, nor the future exercises very close to saudi arabia, where riyadh will decide to go ahead and its own nuclear weapon systems. >> reporter: as a signatory to the nuclear non-proliferation treaty, saudi arabia is prohibited from acquiring nuclear weapons but according to one expert there is a loophole. the saudis could turn to pakistan which has the only nuclear bomb in the muslim world and which experts say saudi arabia helped pay for. >> saudi arabia could actually legally have pakistan's stage nuclear weapons on its territory the way nonnuclear states like italy, germany, turkey and belgium have u.s. nuclear forces stationed on their territory. we do it for nato. saudi arabia would argue they deserve equal treatment. >> reporter: those worried about a nuclear armed saudi arabia are also concerned about u.s. efforts to help develop a saudi

civilian nuclear program that could be used for energy as well as medicine. similar programs are now underway in a number of countries including the u.a.e., united arab emirates, which has agreed not to enrich uranium or take steps to make fuel that could be used for a weapon. so far though the saudis have been reluctant to accept that condition. some analysts fear even if they do, it is going to be a deal that the u.s. will ultimately regret. jamie? jamie: another country fueling up there with nuclear potential. thanks so much, david lee miller, live in the news room. jon: here is a potentially disturbing story. hackers from the group anonymous claim a high-profile break-in possibly affecting millions of people nationwide. what it means for your personal information. a live report just ahead. plus new signs of possible peace talks between the afghan government and the taliban. what it means for our forces on the ground. and the future of that part of the world next.

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jon: new information now on some possible peace talks between the afghan government and the taliban. according to reuters, the country's high peace council has set new ground rules for engagement saying negotiations can begin after the taliban ends all violence against civilians, cuts ties with al qaeda and accepts the country's constitution. david piper streaming live from kabul, afghanistan. he has more on that possibility. david? >> reporter: hi, greg. afghan politicians are making moves to end the taliban's international isolation and perhaps bring them to peace talks but of course there's a long way to go before that happens. now according to the report

by the reuters news agency afghanistan's high peace council has sent a note to foreign missions setting out the ground rules for engaging the taliban. if they say they will accept a taliban office in the gulf state of qatar. there has been controversy about that as it is believed the afghan government was upset and angry because the negotiations about the office didn't originally include them. now there has been these preconditions about negotiations and the high priest council says that they could only begin after the taliban has stopped violence against civilians, cut ties to al qaeda and accepted the afghan constitution which guaranties civil rights and liberties, including rights for woman. the council also said any peace process with the taliban would have to have the support of pakistan as members of the militant group are based there. now the peace council says that well-known figures from

both the taliban and also the government have to be involved in the talks and they're also saying there shouldn't be any foreign interference. now according to officials, the afghan government would prefer this office to be based perhaps in saudi arabia or turkey but was not against doha as long as the authority of the afghan state they say isn't weakened and the office was only used for those peace talks. now a government official has said he did not think the peace council had laid down such tough conditions that the talks would fail even before they have started. now officials have also said that kabul is also deeply concerned about reports that the u.s. was considering the transfer of a small number of afghan prisoners from guantanamo before the, to doha, so that these talks could get underway. now the afghan government says the prisoners should be returned to its custody.

the difficulty of this road to a potential peace talks of course could have a number of setbacks and there has been some already, including the killing of the head of the peace council a few months ago. and of course the clock is ticking now because in 2014 most western forces will have left this country. back to you, greg. jon: david piper reporting live from kabul. thank you. jamie: jon, thanks. let's get some more on this by bringing in fox news national security analyst, the host of defcon-3 on foxnews.com live, kt mcfarland. great to see you. thanks for coming in on this. here's what i don't get. seems to me, just my heart talking here, it is a stall tactic of the taliban to wait for us to withdraw. am i right? >> here's the thing, the afghan government thought they would be there forever so why would they want to negotiate with the taliban? they have the american guarantors sticking around.

they seen iraq and now americans have left. sectarian violence does seem to be breaking out in iraq. the, doesn't look like americans will come back in and save the day so we, the afghan government, maybe we need to make some deals here. so you can see why they have an incentive to negotiate with the taliban but your gut is right. why does the taliban want to negotiate with the karzai government? they know we're leaving. jamie: who is the taliban negotiating with? what kind of power does karzai really have and is this a negotiation the united states should participate in? >> the afghan government doesn't want the united states at least now because they want to make sure they're controlling this. jamie: that scares me that we wouldn't be involved. >> the other thing, who is the taliban? there is not one taliban. there is five or six talibans. at least one or two of the taliban groups are closely allied with the pakistani government. so there are a lot of moving parts here and a lot of questions but i don't see where the leverage is and i don't see where the incentives are particularly for the taliban because they

know we're leaving by 2014. there are rumors --. jamie: or sooner. >> or sooner there are president obama may want a more rapid withdrawal of u.s. forces. when i was in afghanistan they would click their bear wrists and they would say, america, you've got the watches. we've got the time. and that's turning out to be true. >> one of the requirements of these negotiations is that the taliban would have no affiliation with al qaeda. >> yeah. jamie: is that realistic? >> well, yes, because again there are five or six taliban groups much some don't have affiliation with al qaeda. some very definitely do. when i was in afghanistan last time i talked to one of the senior afghan leaders off the record and he said, you know, when the united states leaves our worry is that we'll all be slaughtered because without an american presence in goon began the taliban will come back. they won't want to negotiate and they will want to get rid of all of us. jamie: we can't stay there

forever. >> that is what is actually dawning on the afghan government. again when i was there in spring i met with some people in karzai's office and they were blythely saying the united states will have an agreement with us. the united states will be here until 2020. i said, gee, i don't think so. i think the united states is very war-weary, very concerned that, despite the success, military success of the surge efforts, the pakistani government is not closing down those safe havens in pakistan and the afghan government doesn't seem to be able to unite the country. >> that's for sure. >> the united states, we're doing our best but it doesn't seem to be enough. jamie: finally let me ask you why doha? >> oh, well, i've got to assume it is neutral territory. if you're living in afghanistan or you're in tribal areas of pakistan, guess what? qatar and doha look pretty good compared to the tents and caves you're living in. jamie: that's amazing. where is the money going to come to form this and monitor it and make these

trips? >> that's the problem. everybody has got plenty of money. jamie: the afghan government is going to fund it or the taliban? >> u.s. taxpayer ultimately fund it, whether the u.s. taxpayer funding through the afghan government, taxpayer giving money to pakistan which in turn gives it to parts of the taliban. at the end of the day i think we're really holding the bag. one of the objectives holing any meetings in the persian gulf region they're hoping that those sunni countries, saudi arabia, united arab emirates, any of those countries might kick in a little and help them and potentially be the donors if the united states leaves. jamie: all right, it struck me the rumor you bring to the table that president obama may want to withdraw even sooner. we'll keep an eye on that. great to see you. >> thank you, jamie. jamie: jon, back to you. jon: an infamous group of computer hackers is back at it again. anonymous setting sites on some new targets in what that group says will be a week of hack attacks. a live report of the dangers coming out of washington

just ahead. plus the justice department folding on its position against online gambling. will we see states rush in to make it legal? why some way say the internet simply isn't ready. let me tell you about a very important phone call i made. when i got my medicare card, i realized i needed an aarp... medicare supplement insurance card, too. medicare is one of the great things about turning 65, but it doesn't cover everything. in fact, it only pays up to 80% of your part b expenses.

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the data belonging to clients include the army, the air force and major companies like apple. doug mckelway live in washington. is this just the start of it, doug? >> reporter: that is the impression this loosely affiliated group of hackers known as anonymous wants us to believe. in a statement posted on a blogging website, quoting now, worry not fellow pirates and robin hoods. these are just the as. as it now stands more than 4,000 people representing various clients and and subscribers to stratfor may have had credit card data compromised. hundreds of victims are reporting hundreds of dollars are missing from their accounts, deposited into the accounts of charitable organizations including red cross, care and save the children. stratfor, a think tank devoted to military, economic and intelligence security, has admitted it was attacked. in a statement to its clients it said quoting now, on december 24th an unauthorized party disclosed

personally identifiable information and related credit card data of some of our members. we have reason to believe your personal and credit card data could have been included in the information that was illegally obtained and disclosed, end quote. stratfor says it is now working closely with law enforcement to track down those responsible for the cyberattack, jon. jon: how likely is that? pretty tough to find some of these attackers, isn't it? >> it is very difficult to say whether or not they will be able to track them down. intelligence evidence, peter broox told us convictions for the types of crimes if the hacker is sophisticated enough are very rare indeed. >> one of the great things if you're a cyber operator, cyber operations provide a high degree of plausibility plausible deniability. it is very difficult to figure out who exactly perpetrated the attack. that is why you see such a limited number of indictments or arrests for cyber operations. >> reporter: the hackers claim that they have enough targets lined up to extend

the quote, fun, fun, fun through the entire week ahead. so we shall see, jon, let's hope it is a bluff. doug mckelway in washington, thank you. jamie: interesting news out of the justice department. they have reversed a deck decade-old policy making some and actually most forms of online gambling illegal. welcome news for states considering web gambling, could generate a lot of revenue. you know how states are kind of hard up right now. some large companies in the industry saying the internet, it is not suited for anything more than online poker. who has, this is so cute, the winning hand? former federal prosecutor doug burns and criminal defense attorney joey jackson joining us now, speaking of cute and oh so smart. guys, thanks for being here. >> thank you, jamie. you're sweet. >> appreciate that. jamie: i'm not a gambler personally. i think of bookies in a room with 100 phone lines but the internet really has made a

difference but my question first for you, doug, as a former federal prosecutor, who has jurisdiction over this? was this a justice department question to begin with or why and could the states do whatever they want? >> this is actually pretty tricky, jamie. under the federal wire act of 1961, okay, a federal law made it illegal to gamble online interstate. but here's the interesting thing, in sporting events or contests. now the justice department said that banned everything beyond sports but the logical sort of 7th grade grammar is sporting events or contests means related to sports. the fifth circuit agreed with that so the justice department has taken a much broader view. they were pros cuting cases all over the countries. to answer your specific question which i wasn't avoiding jurisdictionally anything with interstate commerce will come within purview of federal law. it doesn't have to involve more than one state. telephone calls go from state to state. jamie: sure.

>> the point is the federal government a had jurisdiction to prohibit virtually all online gambling except sports. now they're reversing that. jamie: states want this. this would be a way for them to earn money they desperately need but it has to be intrastate which seems to be very expensive to monitor, to know whether or not the person online is actually dealing with a gambling company online. do you see this as really working out or being a total mess? >> it is a mess, jamie, for couple reasons. doug, that was some statutory construction. i haven't done it like that since law school. jamie: you got an a though, i know. >> thank you. >> on issue where it works out it is a problem. here's why. the justice department did indeed reverse the policy, however it is unclear. why is it unclear, jamie? it is clune unclear for couple reasons. the federal government which is congress, right, they can decide to take any loophole in the law, doug was talking about the statutory construction and close it

that would in effect end this thing and make it crystal clear. the second thing now that will happen from a poll at this terp station and -- interpretation and standpoint there will be litigation. fifth circuit court of appeals covers texas, it covers louisiana, it covers mice sip. if there is mortgage litigation it could be overturned. we're far from out of the water here and i don't think the states should be getting overall giddy and decide we will enact whatever we want with regard to gambling. we have to hold the phone a little bit here. jamie: doug, i'm so curious why do you think the justice department would reverse itself? it is a pretty big reversal? >> it is interesting, the office of legal counsel is probably the most academic division, maybe other than the solicitor general's office in doj. antonin scalia, william rehnquist head of that division, office of legal counsel. they honestly felt, jamie the fifth circuit was right. the reality it is not a viable position to say sporting events or contests

meant all gambling. if they wanted it to be that, they would have written sporting events or sporting contests. office of legal counsel agreed. there may be some sort of backstory and other aspects but that is my legal analysis. >> other quick thing, jamie, also there is internet there is federal law which regulates internet gambling. the unlawful internet gambling act. as a result of that another reason for the states not so soon. even if i was born a gambling man, you like that right, jamie i, i would pause for the moment ultimately and see what happens here. >> what about those gamblers out there that say this is bonanza for them? now we're not limited to poker, we can do everything. do you think that they would be willing maybe to pay a little extra since the states will probably put sales tax, who knows what extra charges could come with this? nothing is for nothing, right, joey? >> jamie, i think to your point it is a great thing for states. to the event it was interpreted properly and states would be allowed to

do what they can do here it would be bonanza. everyone is looking for revenue. we're in tough economic times. if you have gambling. you can legalize it. you can get revenue from it. you can tax it. it is a wonderful thing. whether or not that sees itself to fruition given litigation and given the lobbying, we have to already mention, jamie, harry reid was already contacted by interests here to say, look at federal law to see if the feds can't close the loophole if congress doesn't do its job. we're not out of the woods. jamie: what is so interesting, when i first read the research, my god, there is online gambling lobbyists, there must be. how hard do they have to work you think, doug on the justice department to get this reversal? and why do you think they did it? what's in the interest of the justice department? are they pushing it to the states in terms of regulation and review? >> that is phenomenal point you just made because this is all about lobbying, no question about it. think of all the competing interests. you have the interests of casinos. you have the interests of lottery games in different

states. so it's very, very complicated what the real backstory is and who really wanted to do it but joey, at the end of the day you have no know when to hold and when to fold them. >> i knew you would get me back though. >> there you go. jamie: i wonder, there are gambling stocks too. the impact of this. >> absolutely. jamie: doug do you think it will go beyond the companies that are actually in this business? gambling stocks have always been an investment worth considering. >> i was discussing with joe way before we came on, from additionally offshore gambling sites and costa rica and others. now it will come to the u.s. there may be stock market activity, public offerings, new activity. i think you may be right, sure. jamie: cha-ching, guys. joey, behave. no going online just yet. >> he will start. jamie: guys, thanks for coming in. >> thank you. jamie: i know we saw each other yesterday but great to see you again. >> always. jon: jamie at the top you asked who has the winning

hand, i'm going with doug. he has the better poker face. >> thank you. jon: big grin. going with doug. jamie: hold, hold. that's what i say. jon: see you guys. he is one of the world's most wanted men. el chap poe, leader of a notorious drug cartel for the last decade. why authorities may be closer than ever to find one of the world's most dangerous men. [sirens] my name is jill strange, i'm forty-nine years-old, i love gardening, and i love volleyball. i've been taking osteo bi-flex for several years now. i really can't see myself not taking it. osteo bi-flex is a great product. i can go back and do gardening with comfort. [ male announcer ] osteo bi-flex, the glucosamine chondroitin supplement with 5-loxin advanced. shows improvement in joint comfort within 7 days. [ jill strange ] since taking osteo bi-flex, there's nothing that i can't do. [ malannouncer ] osteo bi-flex.

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♪ [ gong ] strawberry banana! [ male announcer ] for a smoothie with real fruit plus veggie nutrition new v8 v-fusion smoothie. could've had a v8. jon: the mexican army captures the head of security for one of the world's most wanted men. joaquin guzman, better known as el chapo. runs the infamous sin low waa drug cartel. he has been on the run since his escape from prison a decade ago. is mexico closer to nabbing one of the world's most

dangerous drug lords. chad sweet, head of. to get the head of security is monumental achievement in itself. it is like when the united states nailed barack obama there was all kinds of follow-on information and intelligence that came from that. are we likely to see some of that from the arrest of this guy? >> we absolutely are. talk about the ultimate christmas gift, this capture is absolutely astonishing given the difficulty getting close to these individuals. number one like you mentioned with bin laden, this drug cartel and particular and head of it, el chapo guzman is number one man in the world today because bin laden is not longer on the list. we saw in the take down of his number three head, gentleman by the name of el nacho, in 2010, the mexicans were able to do friends six

on the homg of the individual along with great investigative work which led to the roll up of the crystal meth operations of the sinloa cartel. they're in the process of exploiting every bit of intelligence they can. you will see a number of follow on arrests from the results of this operation. jon: maybe right up to the top? >> we're hopeful. the u.s. and mexicans are working around the clock with our allies because this is a global, multibillion-dollar operation that's involved here however as you know just like with bin laden, hears about hunted for years now by hundreds and hundreds of special agents, both within mexico, by the mexican authorities as well as outside. so there's a lot of work that needs to be done and it is critical for us and our allies to remain vigilant supporting president calderon and this brave war he is fighting against these ruthless drug cartels. jon: he is running out of time in office. some people in mexico are expressing frustration just

like there was sort of war-weariness at the end of the bush administration, a lot of mexicans are weary with the war on drugs they have been fighting and for him to effect this arrest this late in his administration is a real tribute to what he is doing to do there. >> absolutely. i know the mexican people are weary and obviously the economy is weighing on them as well but just like in our country we need to remain vigilant supporting the president's brave efforts. and if you look at it right now this victory is just another sort of example to hold up to the mexican people to say, stick with the president. he is making tremendous progress and just like in the case of going after bin laden, even though it took a decade, if we're all committed together we can do this. this is winnable just like we saw in colombia where the united states had a great and loyal and consistent ally together in the shared partnership, these people can be defeated. jon: this comes though at a time when the national guard troops that president obama deployed along the southern

border, largely are going to be pulled back, 1200 of them are going to be pulled back s that going to make, in your view, is that going to make any difference to fight these koort tells in the smuggling operations? >> it will. i think unfortunate realities that the united states is struggling with our own budget issues. the president is having to balance that as well. we've got to remember, mexico, we import more oil from mexico than any other country in the middle east including saudi arabia. it is absolutely critical we maintain our contingency plans to prevent violent spillover from lawlessness in mexico to our country. we need to support president calderon by doubling down on things like the merita initiative where we spent $1.6 billion to help him beef up his capabilities to police themselves and take care of this problem on their side of the border. even? in the belt-tightening environment let's learn the

example of this victory here on christmas eve with this christmas present and support keeping national guard on the border where we need them and as well as additionaltology and agents from the border patrol to protect our borders. jon: just out of curiosity, head of security for the sinaloa the cartel where is he better in prison? is it better for the mexicans to hold onto him and lean on information from him or the united states to extradite him? >> better for mexico to keep him. extradition would look like too much collaboration between us and mexico on a matter very personal to the president of mexico and mexican people. this is a mexican victory conducted by mexican forces and we should celebrate their ability to take and prosecute him. as we saw in the case of, again, the el gnaw co -- nacho cornell example we expect our allies south of the border will be competent

and proficient to ininterrogate this individual and get something to take down the cartels. jon: chad sweet. thanks for the information. >> take care, jon are you receiving a payout from a legal settlement or annuity over 10 or even 20 years? call imperial structured settlements. the experts at imperial can convert your long-term payout into a lump sum of cash today. it's good. honey, i love you... oh my gosh, oh my gosh.. look at these big pieces of potato. ♪ what's that? big piece of potato. [ male announcer ] progresso. you gotta taste this soup.

jon: want to take a look now at some of the stories making headlines this hour. china open as brand new high-speed train line between two of the country's business centers. the train said to reach speeds near 200 miles an hour. it cap as very rough year for china's high-speed rail industry which included a crash that killed about 40 people. baby formula maker enfamil say tests show its products are free of bacteria blamed for the death after missouri infant. as a precaution several retailers including wal-mart pulled cans of enfamil formula off the store shelves last week. a research ship coming

to the rescue of a russian fishing vessel stuck in ice near antarctica. the ship has a hole. the crew is pumping out the water filling the vessel. the ice prevented it from reaching the vessel sooner. jamie: what a incredible picture of the that. homecoming for a family in philadelphia, we love this time of year, any time of year. sergeant fordham returning home from afghanistan just in time for christmas. fox affiliate wtff has the story. it was a very joyous reunion. >> reporter: patricia fordham has been looking to fix this christmas dinner for a long time now that her son sergeant clifton forrd ham is home for christmas. >> it is a blessing from god to have him home. i am sweating. i want him to eat everything he has thought about to eat. >> reporter: eating good ol'

home cooking was one of the many things he did since getting back from afghanistan just in time for a busy holiday. >> woke up and church and thank god for it. went from there, with my daughter, had her open her gifts up. in front of the family. did traditional thing from there and running around ever since. >> reporter: he spent the last year overseas providing security operations for convoys, the second of two tours in the middle east now finished. now he is focused on his family, especially his daughter who got a surprise visit from her dad last week in school. >> it has been a blessing to see her still happy and how she is doing in school and staying focused, keeping me focused. >> reporter: knowing she is doing well and the family is together again takes plenty off his mind and eases the worries of his parents. >> you don't want to see them in a box planning a funeral. you want to see them with open arms and they are coming through the door. when you can do their laundry, it is blessing when

you can fold their underwear. jamie: i don't know about the underwear part but it is a blessing and we're so happy we're all back together especially for the holidays. dave kinchen reporting from fox affiliate, wtff. sergeant fordham was supposed to be home for thanksgiving. that day got pushed back with the troop drawdown was actually delayed. he said being home for christmas is the next best thing. jon: being home for all that home cook cooing. great for him. why recovery from illness might hinge not only on over all health and caliber of your doctors but how your hospital room appears. we'll explain that coming up. also an ad made years ago is getting some new life during the gop race for the white house. so what does newt gingrich thing of it? and what impact is it having on the presidential race, next confidence. available in color.

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jamie: silent night no more. now rowdy politics just eight days before the iowa caucuses. hi, everybody i'm jaime colby in for jenna lee today. jon: it's a monday, feels like a tuesday. i'm jon scott. welcome to america's election headquarters and the second all new hour of happening now. republican candidates back on the campaign trail making a final push before the first in the nation caucuses, with many iowa voters still undecided and the polls showing a very close race this will be a critical week. jamie: look, there is kelly wright. they are busy, kelly. >> reporter: indeed they are. we are not sure what gifts the republican candidates actually received from santa. we do know what is at the top of their wish list, that is to receive the republican nomination. that is not up to santa, it's up to the gop voters. that's where we begin. that's why the candidates will

be in full campaign mode in iowa this week. it's the final stretch of campaigning ahead of the caucuses. let's begin with the top three candidates, with the iowa caucuses taking place next tuesday on january 3rd, mitt romney will start a campaign blitz throughout the state tomorrow. you're also looking at what he just released a new television ad for iowa called conservative agenda. it targets conservatives who have not fully embraced romney. he is hoping they will do so by next tuesday. there is ron paul campaigning throughout the straight. he will hold a town hall meeting in council bluffs on thursday. there are some that believe he could possibly win in iowa. he continues to attract supporters who may turn out big in the caucuses. as for newt gingrich he will begin a 22-city bus tour crisscrossing iowa to urge voters to show up at the caucuses in support of him. gingrich is calling the tour, the jobs and prosperity bus tour. the "real clear politics"

average poll shows ron paul leading in iowa, followed by mitt romney and trailing in third, newt gingrich. the recent rasmussen poll shows mitt romney is enjoying the lead now as well. mitt romney with 25%. ron paul 20%, newt gingrich trailing who had been a frontrunner slipping to third and all the other candidates are at 10% or less. so from this. jaime, and jon, you can see from these polls that the voters in iowa have really had a tough time zeroing in on what kind of candidate they want to vote for. that's one of the reasons why it's so hard to predict who will win in iowa. it's completely unpredictable at this point which could pave the way for an exciting iowa surprise. whoever wins hopes it will give them momentum going into the new hampshire primary two weeks away, later in south carolina and florida, all of these taking place in the month of january. jamie: that will be exciting and i'm predicting the next eight

days will be exciting. keep us posted. >> reporter: good to see you, jaime. jon: let's look to super pus now. a couple of the candidates who hope to be president will not be on virginia's primary ballot. why? well that state's republican party says rick perry and newt gingrich simply failed to qualify. we have the executive effort of "real clear politics".com. what is the big picture? this happened a couple of days ago. a lot of people might not have heard about it over the christmas holiday, tom. give us the thumb-nail explanation of what happened here. >> the candidates are required to submit 10,000 valid signatures to qualify for the ballots which are not going to be printed and re red deal. the candidates had five and a half months to get this done. mitt romney managed to do it, ron paul managed to do it. some of the lower tier

candidates, bachmann, santorum they did not even submit signatures at all. gingrich and perry submitted just over 10,000 and enough of those were disqualified for one reason or another to disqualify them overall from the ballot. it's really inexcusable for the candidates to not have made a ballot with so much notice and really a 10,000 signature threshold is not that high given as much time as they had to prepare. jon: you suggested maybe newt gingrich thought he wouldn't be on the ballot come super tuesday and maybe he didn't try that hard, is that possible? >> gingrich had said they are a month or so behind schedule and that leads you to believe that gingrich never thought he would be the frontrunner and really wasn't prepared for having -- being part of the process at super tuesday and beyond, so he was scrambling to hut thi to put this pink together. thing together. this is politics 101, blocking

and tackling. people focus on the polls and popularity but there is a lot of grunt work that needs to be done to run a presidential campaign, and clearly perry and gingrich haven't been getting that stuff down. jon: gingrich has been focusing his attention on the debates because that gives him a free platform, free exposure but a debate will not get you 10,000 signatures. >> that's right. again this is -- in 2008 six republicans qualified including fred thompson, as you remember he joined the campaign late and wasn't known for having a fantastic organization, but even he was able to do this. six democrats qualified. it's not like there was some unbelievably high bar in virginia that the candidates couldn't meet. gingrich's campaign has sort of accused virginia of something to that effect. they said we'll go ahead and organize a write-in campaign. there is a problem with that. in virginia that is illegal, that is not an option for them.

there will only be two republicans on the ballot, that is romney and paul in virginia on march 6th. jon: in one recent quinnipiac poll newt gingrich was leading the state in virginia. the fact that he apparently barring some miracle won't even be on the ballot, does that shoot down his prospects to eventually become the nominee? >> i don't think this is a game breaker for a number of reasons. up until april 1st they are allocating the delegates proportionately. there are only 50 delegates in virginia. it highlights the fact that his team from a manag a managing standpoint are not doing what is required. they are giving mitt romney a free play in virginia. if this comes down to be a very tight delegate battle, long and drawn out, 10 or 20 delegates could make a difference in the

end. it might be significance. jon: it could be crucial when you get down to crunch time. tom beffin from "real clear politics." thanks. jamie: the president is in hawaii on vacation with his family. doug is following their every move live in honolulu, at least what they'll tell us is going on. what are they doing today, doug? >> reporter: that's right. good morning, jaime. we'll see it's still quite early here. the president i'm sure has a number of activities planned with his family. a little bit of work, a little bit of play during this vacation time in hawaii. yesterday we saw the first family, the president, the first lady, and daughters heading off to church at the local marine base, that was after opening up christmas presents at their vacation rental home here. later in the day the first couple returned to that base to chat with service members there, thanked them for their service and spent some time posing for photographs.

watch and listen at this interaction as the president held up a baby for a photo and he wound up with a mouth full. he got him. the president pretty much took that in stride though and the family in question got a photograph and a moment with the president that they won't soon forget. on the serious side of things we do have the situation in yemen happening where security forces there are once again taking arms against demonstrators who have demanded the ouster of the president there. a white house spokesman says that the chief counterterrorism official for the united states has reached out to yemen's vice president. this is a quote, he emphasized strongly the need for yemeni security forces to show maximum restraint from dealing with demonstrations and called for all sides to refrain from

provocative acts that could spur violence. he said he would do his utmost to prevent further bloodshed. as for the president there, saleh, he has requested to come to the united states to seek medical treatment. the white house says they are considering that q. it depends on whether that is deemed to be actually required treatment, it's something the white house is still looking into. jaime. jamie: definitely a vacation but a work trip too. thanks so much. live in hawaii. jon: right now we are getting word at least 20 people are dead in syria after government tanks opened fire on anti-government protestors. it happened in holmes, a city at the heart of the nine-month-old uprising. violence there intensifying despite an agreement by president bashar al-assad to end the offensive against demonstrators. as monitors from the arab league arrive in that country on the verge of an all-out civil war

leland vittert is keeping an eye on it live from jerusalem right now. leav >> reporter: what seems like is happening is the syrian government is trying to kill as many people as they possibly can before the arab observers get in place. they are scheduled to land in damascus in the next couple of hours. this is a race against the clock and brutality if you will. the video that is coming to us out of holmes is really, really disturbing stuff. this is the city that was at the very heart of the uprising and resistance there. the president's father, bashar al-assad's father there in syria killed 20,000 people in holmes when they revolted back in the 1980s. tanks are in the street. they are indiscriminately shelling entire neighborhoods. the syrian free army which are a number of army desserters who have banded together to try and

save their own country and save some of the prodemocracy demonstrators have been unable to repulls any of these attacks. they don't have the kind of fire power they need. we are getting word the crackdown may be entering a final stage if you will as they are trying to break the back of these protestors. the arab league observers will arrive in damascus later today. there was an advance team that went in over the weekend. there is a report out of syria that one member of that advance team snuck into holmes to get an idea of what is really going on there, and was wounded in the shelling, but that is still as of yet is unconfirmed. these observers are there because bashar al-assad promised the arab league he was going to stop all this violence. the observers aren't armed, it is not a keep keeping force or no-fly force or something like that. they are really only able to sit there and observe as their name says. so far in syria 5,000 people have been killed. as it stands right now this h

resistance in syria has been going on longer than anything out of the arab spring that came out of this. bashar al-assad has survived longer than anybody else. he has powerful allies, iran and russia there and that takes the military option off the table. where you have the situation where there is a lot of diplomatic pressure from the united states, the eu and the arab league it is little more than shouting at the rain as to whether or not he is willing to stop killing his own people. back to you. jon: moammar qaddafi was doing that, we set up a no-fly zone and eventually toppled him. we are not doing that in syria. hard to believe. thank you very much. jamie: an update on a tragic story, jon that happened over the weekend. this particular soldier survived a suicide bombing in afghanistan, he came home and he recuperated, and now he may be paralyzed for life after a shooting at his own welcome home

party. we'll tell you how it happened and also let you know how his condition is today. coming newspaper a live report. coming up in a live report. >> he won't never walk again. ♪ [ woman ] ♪ what i want this season ♪ if you'd like to try and guess ♪ ♪ it is something very special ♪ i would readily confess [ dogs barking ] ♪ 'cause all i want this season ♪ ♪ is something from your heart ♪ la da da, la da da

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jamie: police in california releasing this mugshot of a man who is suspected of shooting an american soldier who survived a suicide bombing in afghanistan only to come home to get shot at his welcome home party. rick lozano live from san bernardino, california with the very latest. thanks for joining us. >> reporter: you're welcome, jaime. here outside the san bernardino city police department where detectives continue working this case very aggressively, and as you mentioned this is a young man who was awarded the purple heart after surviving that suicide bomber in afghanistan.

now, he had been recovering from those injuries at fort campbell, kentucky, but he had decided to come home for christmas. there was a party at his family's home this past friday night. it all seemed to be going well during that party, however, at some point late into the evening we understand there was an argument of all things over football. it was between sullivan's younger brother and another man who was attending the party. apparently that other man threw a punch at one point, sullivan decided to intervene and at that point the other man who has now been identified and we have a picture of that suspect, here he is, ruben ray zarado apparently pulled out a gun and fired several shots. two of those shots struck sullivan, one of them hitting him in the neck. it shattered his spine. he is in critical condition.

doctors say more than likely he'll be paralyzed from the neck down. police are looking for the suspect who they believe has gang connections and they fear he is probably being harbored by gangs at this time, but a very intense manhunt going on for that suspect at this time as sullivan continues recovering at a local hospital. that is it from san bernardino. back to you. jamie: thanks so much. that is such a discouraging story. we are praying for that family. thanks, rick. jon: police are saying that guy should be considered armed and dangerous. they'd like to hear if anybody knows where he is. jamie: i'm glad we put the picture up. jon: don't try and do anything on your own. a new way to boost healing by making hospitals more appealing. how decorators are helping doctors and their patients. jamie: doesn't look like that i bet. [ male announcer ] in 1924, an italian chef came to ohio.

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about medical news interesting and wanted to bring it to you. it's about how hospitals across the country are helping patients recover faster. decorators are giving an extra boost to the art of healing. anita vogel live in los angeles with that. >> reporter: hi, there, jon. it comes down to design, evidence-based design that is. it's a concept around for about 20 years or so. it's catching fire. it's all aimed at promoting healing. at scripps health in southern california they are putting this plan in motion at its new heart institute under construction right now. the rooms here will have lots of natural light and soothing colors, elements from home like flat-screen tvs. studies showed this can reduce a patient's stress and a scripps ceo tells us this will soon become the standard.

>> i can't see a hospital -- especially if it's being built from scratch being not using evidence-based design and frankly i think that there will be organizations that take advantage of our learnings and will build even better facilities down the road based upon the evidence we gain in this facility alone. >> it will be hugely impact full. oftentimes they are not just here for a notice or two. they might be here a stretch of time. if they can have an environment that provide comforts of home where they feel they are in a home away from home that is huge for their spirit, their well-being, their outlook, that is huge. >> reporter: more than a thousand different medical studies have shown when a patient feels more comfortable and has less stress the healing process is faster. statistics show they use 22% less pain medication when they are surrounded by natural lighting. in fact the theory is this can wind up saving the patient a lot of money. if you heal faster you get out of the hospital a lot quicker and your hospital bill will be

lower. jon, who is going to argue with that? jon: makes a lot of sense. thanks, anita. jamie: all i got to say is if i'm in the hospital, get me out of the hospital. and joining us to talk more about this. dr. steven garner from new york methodist hospital. i don't care how adorable the room is hospitals aren't places people want to be. is there a medical benefit to this? >> definitely. the quicker you get out the less chance you get an infection that might keep you there. 37% of nurses get become injuries during the year. by redesigning the year and changing the bed configuration you can reduce it down to 5%. jamie: it's good for everybody. they say they are going to have nature, windows, instead of windowless rooms. >> it improves their pain tolerance, that decreases and your depression. people are depressed in the hospital, particularly for elderly people, there is an icu

psychosis where they totally loose contact, they are in a room with beeping all the time. jamie: what about the cost? >> it will be a winner for the hospitals. a fall calls the hospital $10,000. if you can redesign a patient's room so he doesn't fall you save 10,000 bucks. in the long run you're going to win. in the short run you need to come up dar das -- where are you going to get the money? many hospitals are struggling to stay alive. this is designed that is based upon studies that improve the patient's stay, improve the guilt of life for the staff, it's very important when the nurses are there all the time, and it reduces doctors errors. the doctor has no place to write his orders. he's in the middle of a desk with his phone calls, people are screaming and yelling, he can make a mistake. give him a right area to do it where it's a little quiet, he

can reference things, fire medication errors. jamie: with the ocean view we showed in that room the doctors are going to spend more time with their patients. >> i'm going to check in there, it looks nice. jamie: looks like a fancy hotel. i just noticed crossing the wires, folks, prince phillip who you know had a heart procedure over the weekend which what was reported a stent will spend a fourth night in the hospital according to these reports. doc, i know a little bit about the topic but a fourth night for a stent. >> this is quite unusual. usually a stent you are in, they want to get you out. we talk about the infection. could he have developed a pneumonia, an infection or an irregular heartbeat and needs further work. it's aeul little bit unusual. jamie: would they take extra precautions for someone of his stature. >> get him out of the hospital, he's 90, more prone to catch infections. he would be better off at home. there may be some reason.

maybe the heartbeat is not regular. he may need additional work. jamie: we'll keep an eye on it for you folks. dr. garner, thank you. jon: a wet mix of winter weather is causing some travel trouble during a very busy holiday week. there it is on the radar. a live update from the fox weather center on what is going on down south. plus, it is the attack add technique of choice for the 2012 election. what you've said or done on camera could be used against you. how the new ad strategy is working. our news ad panel takes it on next. >> governor romney in his business career created more jobs than the entire obama cabinet combined, so he can actually talk about it.

jamie: you get a little bit of a break if you work in the markets, tkhroer, they are closed today. wall street finished strong. what can we expect once the traders return from holiday. lori rothman joins me now. i'm very sur just about what will happen now waoefpl. >> it's been a terrific couple of weeks. we had a third week of gains in the last four, we've been in rally mode. have you heard of the phrase, santa claus rally? do you know what that is?

jamie: no. >> these are the last five days of the year. a tremendous track record of gains. we are set up beautifully for that. i was reading the holiday spending numbers. lack luster but a gain knew the less. jamie: stores were bragging. >> it started off with a bang and tempered off a little bit. we'll gain shy of 4% growth on the retail sales last year. growth, not as robust as some of the economists would like to see but a gain nonetheless. jamie: what about consumer confidence and people putting their money into the market after the first of the year. they open up the end of the year statements, if you guys are brave enough to open up the retaoeufrpl retirement statements, what will they do? >> this is so important because it's gage of how you're feeling, how confident you are to put the money out, to invest it in the market, to spend it out there in retail land. that will be a key indicator. and a key karat owe'll get the

home prices number. if you remember the news last week the entire industry was revived lower by the national ha soerb kwraeugs o association of realtors. we know how weak the housing market has been since the housing crisis, it was even worse than that. that could be a down note. positive news is on the jobless claims. we had a tremendous improvement. 324,000 people filed for unemployment benefits, best number since april of 2008. that number comes out on thursday next week. that will also be very indicative. jamie: it went from 400,000 to 300,000. there are still a lot of people out of work. >> they are moving averages. we have stubbornly high unemployment in this country upwards of 8.6%. we will take any improvement we can get. this is the weakest link in the economy right now. jamie: i have to ask you about oil prices and the fact that iran had the war games and they

are threatening to really close off at least part of the straits of hormuz. are you seeing any pre dicks on oil. >> not great news for the gas pump. that is definitely something to watch for in terms of the geopolitical risk. watch the value of the dollar. don't forget the oil barrel is priced in dollars, the weaker the u.s. dollar is the more dollars it takes to price that barrel. if we see some weakness in the dollar you're likely to see oil and other commodities rise next year. with all these troubles going on in europe still the dollar and u.s. treasuries remain the world's safety net. everybody is investing in the u.s. jamie: you seem like an optimist. what is the future of the euro. >> the euro region with all the trouble surrounding the sovereign debt crisis the good news is that the eu and other organizations in europe have got even together the ims as well

and they've taken measures to keep the banking industry and the financial markets moving. they have not solved the sovereign debt crisis. you have a lot of these countries still way indebted and that is very, very troubling. so there is a growing chorus right now of people expecting the euro region to actually break up and the euro as a currency itself go bye-bye. i think you might see in terms of like inflo of foreign investors might turn and invest in the u.s. jamie: come on over, folks. >> that is going to be the big story for the new year, what happens in europe. jamie: we covered it all. now you'll know when the markets open tomorrow, jon. jon: a warning for candidates in the 2012 election, anything you say can and will be used against you, like the old miranda warning. as you're about to see yesterday's campaign promotion can become today's attack ad. >> we do agree our country must

take action to address climate change. >> if enough of us demand action from our leaders. >> together we can do this. jon: some old video of newt gingrich there with nancy pelosi the kiss of death to conservative voters. let's talk about it with our news watch panel, alan colmes, host of the alan colmes show. jim pinker ton an editor and writer for the conservative magazine. newt gingrich has gone onto say that the sit down on the couch with nancy pelosi is the single dumbest thing he's ever done. i imagine when he sat down on the couch he wasn't thinking of a presidential run. >> apparently not. gingrich did it, the video is there. all he can do is apologize for it and as they say, move on.

we are seeing the birth of a new political art form, if you will. these videos that fly around from cellphone to cellphone to ipad to computer to tv, and become and forth, it's become a major factor in this election. jon: there are four candidates, ace understand it, who are using snippets of that same video, alan to try and take on newt gingrich and try to damage him because, you know, well like the line says -- go ahead. >> i believe newt gingrich knew back then he was going to run for president. it's too bad he has to runaway from nancy pelosi as if the two sides can't occasionally agree on something as scientifically valid as climate change exists? the real issue is that he changed his mind about that all of a sudden or is he playing a political game? he knew he was running for president back then, i'm pretty sure. did this is views change or is he saying something now to appease the far right for the

sake of winning a primary. jon: i remember when the public service announcement came out, it was 2008 and the sight of newt gingrich sitting on a couch with nancy pelosi agreeing on something seemed pretty profound at the time. if you were advising him on a strategy is he handling it the best way? >> i think he's handling it -- if i were advising him then i think he would say not to do it. i'm not convinced as alan is that newt was planning on running for president. jon: so, if he were to handle it in addressing the controversy now, because like i said, four of his opponents are using that spot against them. what should he say? >> well he should quote former mayor laguardia of new york who said i don't make a mistake so often but when i do it's a beaut. a lot of these attack videos are suffering from severe editing,

and they are cheating, whoever is doing the lateral videoing is cheating. the rick perry video that made him look kind of drunk or silly was a 3 high minute video cut down from 20 minutes. >> we've seen mitt romney take obama out of context, he was actually quoting john mccain. he seemed proud that he did it. the digital world creates a very different kind of media and presidential campaign. we can keep them honest too because we can see the whole of that they are saying. what newt gingrich tried to do is the opposite of what jim is suggesting. i think you ought to say true leadership is standing up for what you believe even if you occasionally happen to believe with someone on the other side. i think the american people like to see people come together on certain key issues. >> i'm not sure that alan has newt gingrich's political interests at heart. >> i think that would be more

honest reaction. i do like newt gingrich although i don't agree with him on everything. i'm sure he notes there is something as climate change but why not acknowledge it. jon: we have another example of an ad involving words that he spoke, this from the romney campaign. let me play this clip. >> governor romney in his business career created more jobs than the entire obama cabinet combined, so he could actually talk about it. jon: again, using your opponent to praise, pretty clever use of a newt gingrich sound byte, won't you agree. >> i don't know that it's true. the fact is that mitt romney also went and fired a lot of people when he was running his business. he would clean out businesses, bring the bottom line up and let people go. the obama administration misrepresented that 3 to 3.5

jobs have been created in the obama administration. we are not hearing an honest accounting from the right. we can keep them honest with this digital ability we all have. jon: how does romney take on what alan just said regarding bane capital and job loss? >> there are two different issues. romney will only take so favre taking eight seconds of gingrich praising romney's record. there is plenty to criticize there as well. what romney has to do is just -- look, rom no has to run his own campaign. he has to go positive. the viral video videos, especially when they are hidden. they appear in your inch box on facebook and you never know who posted them, who edited them, so the most powerful thing to do is i think the ads you showed earlier from romney, a positive ad in iowa with the kid in the corn field, i think those are more effective from rom no'

romney's point of view. people are suspicious of a lot of them because they don't know where they are coming two. jon: two-thirds of money spent in iowa is spent on attack ads. >> i'd like to see a more positive message. i think that's what newt gingrich said he is going to do. people will respond positively to that. jon: that's why we bring you on here, alan, you're always mr. sunshine. we love you for that. alan colmes, jim pinker ton, thank you both. i host great panels like this one on saturdays, news watch 2:30pm eastern time. jamie: well, if alan colmes is mr. sunshine it must be must there is a storm brewing that is causing troublesome place else, up and down the northeast it's caused a lot of problems for holiday travelers. maybe you know already but you should, if you don't maria molina live in the fox news

extreme weather center. maria we hope everyone will be careful out there. >> reporter: we really do hope everyone will be careful. across the south we have problems right now with flash flooding being reported across the state of louisiana and mississippi. there are flash flood warnings in effect out there. we saw a lot of rain yesterday, one to two inches of rain out there and continuing to see thunderstorms and areas of heavy rain with an additional three inches possible locally in some spots. total rainfall accumulations between four to five inches in rain out here. that is producing flooding and the storm system is going to pull towards the northeast and pull in colder air with it. we'll start to see changes here as we head into late tonight and also into tuesday with our winds picking up as we have some of the heavy rain moving into our area. right now the storm system across parts of the tpheud south a little bit on the northern end we saw freezing rain. those of it has transitioned over to rain now across the state of missouri, that is where we're looking at mostly rain today. other by 3:00pm tuesday take a look at where the storm system will be located over parts of

the great lakes and interior northeast, back side of it you'll see the rain transition over to snow across the ohio valley and also into the interior northeast by tuesday night. we are going to be picking up a little bit of snow out there, a couple of inches, generally, though, less than six inches. the exception will be some of the areas downwind of the great lakes and also across northern parts of upstate new york where we could he some about a half a foot. otherwise the big issue will be the wind. windy across the northeast, the big airport hubs could see a couple of problems as you start to see the winds pick up, up to 30 miles per hour. the wind will be sticking around as we head into tuesday and wednesday with the next storm system. another area of concern across the pacific northwest we'll have a storm system arriving as we head into later this afternoon and it's going to stay unsettled out there at least until midweek. jamie: we'll keep an eye on it with you maria, thank you very much. jon: heartbreaking loss to tell you about, a christmas morning inferno takes the lives of five members of one family, including three sisters. the oldest just ten.

the investigation into what happened as a community is in complete shock. >> it's a great, great tragedy. people probably don't have words, and i don't know the people, as i say, i'm just a visitor, but it's a great, horrible, horrible thing on a christmas morning. when you have diabetes... your doctor will say get smart about your weight. that's why there's new glucerna hunger smart shakes. they have carb steady, with carbs that digest slowly to help minimize blood sugar spikes. [ male announcer ] new glucerna hunger smart. a smart way to help manage hunger and diabetes.

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>> reporter: i'm rick folbaum in for megyn kelly. a saudi prince is talking about a nuclear arabia. what lit mean for the middle east, the u.s. ambassador bolton will be here to talk about that with us. tax talks round two it starts up again after the start of the new year. what can the gop do to get the upper hand this time around? and sugar, maybe you feel like you've had your fill of sugar over the last day or so. there is a new study out and we'll talk about it, why eating even more sugar will help you feel good this time of year. that is coming up in a couple of minutes. julie banderas will see you in a few minutes for america live. jamie: right now we are inside our control room with new information on stories we are watching across the u.s. and around the world. there it is. gruesome new details in a christmas day murder suicide outside of dallas. police say the gunman wore a santa claus costume and then

shot and killed six family members during a holiday gathering. he then took his own life, and police are not releasing the identities of the gunman or the victims. police in virginia looking for 27-year-old jamal lewis clemens, accused of murdering two people and kidnapping a two-year-old boy at the scene. the boy was found and reunited with his mother. investigators in russia trying to figure out what caused a massive warehouse fire. it spread to three different buildings, one of them is still burning, and one firefighter suffered burns. jon: right here at home an unimaginable christmas heartbreak. three youngsters and their grandparents dead after a fire races through their home in connecticut. mike magnoli of fox affiliate wtic has the story. story. >> i heard somebody, help me, help me. >> reporter: startling cellphone video of a deadly fire. a nearby resident watched in

horror and he recorded the tragedy as it was untolding. this is a well to do neighborhood, home to many new york city commuters. to stanford this fire is an unprecedented loss. we now of two survivors who escaped the blaze. >> the man was in boxers, no shoes and a short sleeved shirt. the woman, i heard her say, my whole life is in there. >> reporter: the mayor went to the scene scene. he fought back tears as he talked about the scene. >> it is with great sadness that as mayor of the city of stanford i even have to report this to you. >> i've been on this job for 34 years, not an easy day. thank you. >> reporter: residents are shell-shocked. some have been standing on the corner all morning long watching

the tragedy unfold. >> it's a great tragedy, a horrible, horrible thing on a christmas morning. >> it's hard breaking. it's the biggest fire in stanford in maybe a couple of decades. >> reporter: other residents we spoke to say the family had just moved into the house a few months ago. they were in the process of re renovating. jon: the only survivors of this tragedy, the girl's mother, a prominent advertising executive and a male friend, a contractor who was doing work on the home. jamie: meanwhile iraq, it is rocked by the worst violence in months. of course this is after u.s. troops have left the country. so what does it mean for stability in the middle east and our national security right here at home? we'll take a closer look with major general bob scales. ugh pa, do you want fast relief? try bayer advanced aspirin. it has microparticles so it enters the bloodstream fast and rushes relief to the site of your tough pain.

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jamie: "happening now," vice president joe biden reaching out to iraq's prime minister offering moral support following some of the worst violence seen in iraq in months, right after the last american troops left the country. let me tell you about the latest. a homicide bomber today in baghdad killing seven people at a check-point leading to the interior ministry. major general bob scales, fox news military analyst joins me now. thank you for coming in. >> hi, jaime. jamie: violence seems to bess ka hraeugt at this point. thtoto bess ka hraeugt. wtobess ka hraeugt. >> our quick withdrawal from iraq left a power void, a vacuum in the country that is being killed by the chaos that you see going on right now, jaime.

the administration has done a good job by trying to patch the holes by sending generals back to act as sort of a group of senior mentors with nouri al-maliki, a little diplomacy with a military bent to it to heal the wounds. we are not going back. it's up to the iraqis. as you've seen in the news, it's a real mess. jamie: i believe it's your opinion and other generals and people who have spent a lot of time in iraq that i've talked to, including general keen tell me that the iraqi military and police have been prepared, that we did a great job getting them ready. is this really the point, though, where they just have to suck it up and take over? >> well, i think that is part of it. no, we have done a brilliant job. a phrase that i heard from one senior leader was, this is a job well done, but a job that is incomplete. i think there is a sense among the american military that our presence among the iraqi

military acts as sort of a calming influence, an arm around the shoulder, a key trusted adviser. after eight and a half years of fighting war together, of building the iraqi military oftentimes they look to the americans not just for military training advice, but for moral advice, advice on how to be a military in a civil society. all of a sudden that's been withdrawn. no, no the u.s. training effort there has been satisfactory bush but the withdrawal is precipitous and what we are seeing now is the results of that early withdrawing, jaime. jamie: violence hasses escalated, the pictures we have been showing. i worry about the spill over into afghanistan where our troops still are. i want to ask you about this report of setting up these meetings between the taliban and hamid karzai and whether you think there is any benefit to that for our troops, or not being involved in that, could that be detriment alto our troops?

>> that is a great question, jaime. i've talked to some folks in afghanistan and they tell me the same thing. first of all they say who is the taliban, there are five, six, seven different groups of taliban. some are antigovernment entities, the other are tribal entities. i think they think that we were going to be in afghanistan until what, 2020, 2025, we could back stop the government. all of a sudden they are seeing americans out of iraq. their fear is by 2014, 2015 we'll be out of afghanistan. they are trying to find some way, government is to connect to the taliban. the problem is the ball is in the taliban's court right now. they are the ones that hold all the cards but they expect us to be gone in two years. jamie: whoever they are. they have a real incentive to sit and wait. before we go and i only have really 20 seconds. can you define what the remaining mission is in afghanistan? >> train the afghan military and police. get them as proficient as the

military and police are in iraq at a minimum before we leave, and leave behind us a similar power vacuum, jaime. jamie: major general bob scales, 19 seconds. good job, sir thank you so much. >> thank you, jaime. jamie: we'll be right back. keep it right here on fox. u tod? we gave peopleight off the street a script and had them read it. no, sorry, i can't help you with that. i'm not authorized to access that transaction. that's not in our policy. i will transfer you now. my supervisor is currently not available. would you like to hold ? that department is currently closed. have i helped you with everything you needed ? if your bank doesn't give you knowledgeable customer service 24/7, you need an ally. ally bank. no nonsense. just people sense.

>> that was fun, jon. over the weekend i watched your west point superb. jon: oh, thank you. >> and it was just glorious. jon: beautiful