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tv   The Kudlow Report  CNBC  July 24, 2009 7:00pm-8:00pm EDT

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banks. i've said many times profits are the mother's milk of stock and business. the message here is risk taking is alive, spending continues, as business gains health, so will consumers, nearly the 90% still working and employed. key economic indicators have overridden the disappointing june jobs report. let's look at all this stuff. boom. we'll start off, fallen jobless claims, rising housing starts and three straight gains of index of leading indicators. these are very strong recovery signals. first, the initial jobless claims. from 660,000, trending down to 550,000. this kind of takes away the pain from the dismal june jobs report that did worry me when i first saw it. this is suggesting the worst of
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the employment problems may be behind us. we won't know for a few weeks but worth thinking about. the leading indicators, overall, the most important overall aggregate, we're talking stocks and liquidity and spreads and manufacturing and production, all in here. you have yourself three straight monthly increases. we had a big number just about a week ago. this tells me if history is any guide at all that we are heading straight for some kind of economic recovery, it may not be the fastest and undoubtedly, it will be slower than normal, at least we're turning from recession into recovery. let's take a look at another important, existing home sales, you now have one, two, three, four straight months. very important to get housing as a bottom and beginning to slog upward, even nemedian prices in
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some key states, like california and florida and nevada and arizona, the prices are down 40, 50%, but the sales are up 50 or 60%. nationwide, we've had a couple of gains in the median prices. that's another good sign. let me go back, hold on one second, stay with me, leading indicators, one hor, hold on a minute, i don't see the housing starts. i'll go to corporate bond spread. another key point. corporate bond spreads, another measure of risk and credit worthiness and confidence in the economy. these have come down just about 50%. this is really important. all the way down from the worst moments last september, when the lehman brothers closed down, shut down, bankruptcy hit, we're down 50%. in fact, at this point, down here, we are getting very close
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to that lehman number that was back to august and early september of 2008. what does that mean? that means not necessarily a return to normalcy, but a return to things that are so much better. you cannot tell me that today's story, both financially and profits and leading indicators, now, in these corporate bond spreads, this is a high yield merrill lynch index against the treasuries, things are so much better than they were a year ago. let me make a couple of other points on this, this evening. we are seeing in washington, the ee mmergence of gridlock on the great health care debate which has huge tax increases, massive new spending and borough and possibly a nationalized health care program. today, the leading blue dog democrat walked out of the meeting with the house democratic leadership and said, no deal. in the senate, mr. reed,
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democratic majority leader has already said is there not going to be a vote before the summer august recess. my point is a simple one here. as long as it looks like -- as long as it looks like gridlock in washington over health care and possibly cap and trade, it suggests to me, that the worst of the left wing stuff is not going to get through, there's a grassroots message that may be moving up and affecting president obama, i surely hope he listens. but for the moment, i conclude, as i said last night emphatically, that free market capitalism is alive and well, at least for another day. that's about as good as it gets, folks. in this game, one day at a time. let's bring in our gurus. we have steve moore of the "wall street journal," who just sold all his stock today. we have to explore that. we have joe. and author of "a bull for all
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seasons" and peter maurice risy. i will stay right here by this platform. i'm still searching for housing starts number. steve moore, i have to tell everybody out there. steve moore gleefully called me on the cell phone to tell me he sold his entire portfolio today. you're either going to be a genius or you know what is your logic because you are really bucking the tide, my dear brother. >> first, larry, let me say i don't have nearly as much money in my portfolio as all the rest of you do. when you talk about free market capitalism being alive and well, what country are you talking about? i don't see anything on the policy horizon that is bullish. i would challenge you and the others on this panel, larry, to point to one single thing that the obama administration is doing that is good for stocks. >> what about the gridlock over the health care program? what about the new -
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new -- listen -- i will come right at you. i don't think this is the biggest part of the rally. we will get to the earnings and leading indicators. since you insist, since you foolishly sold your whole portfolio today, the democratic party is bigger now than the big left liberal thing that it used to be. >> i don't agree. >> you have about 50 plus blue dogs in the house that ain't going for this. steve moore, you have to admit this is bullish. i'm not saying they're supply siders like john f. ken dirks i am saying this may be a new democratic party, let me give them a little bit of credit for having some diversity, meaning moderates. that doesn't mean anything to you? >> i agree with you about something you said earlier, there is a sea change going on in the public, i've been to three or four states in the last few day, maine, nancy pelosi, california, wisconsin, all those states, people are enraged about what's going on in washington, i agree there is a stalling of this democratic agenda. i think the blue dogs they're
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talking about are a far as. they voted for the stimulus bill and voted for for cap and trade bill and will vote for a health care bill all be it not as bad as charlie rangel pointed out. i agree, i could have sold out one day early. >> a day, we could be going back to lehman brother levels. >> steve moore, what do you think about this portfolio kneeling terrible idea, the dow is going to 12,500 by the end of the year. i said in may when the stress test results were released, come the end of june, the market would smell recovery and take off. i was off by seven day, that's not bad for an economist, especially one that teaches in a cow college. that said, i don't expect the guys over my shoulder to solve this problem, i want them to leave it alone, let american capitalism thrive, stay out of health care and can cap and
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trade and let the america's natural economy, let it recover. >> inside the economy, to the meat and potatoes, joe, welcome back. you have 47% firms reporting, 77 beating estimates by 27%. i understand they're not all declaring rising profits yet. the beating of expectations has had a gigantic impact on this remarkable two week old summer rally, which comes out of the blue and i must say completely fooled the vast majority of the so-called smart money in the hedge fund world. joe b., where are you on this story. >> here's the problem, all the yelling and screaming aside, earnings will probably come in 25% below where they were last year, even some of the companies we celebrated this last week, including caterpillar, earnings were one-third below a year ago and talking about great visibility they will get back to
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earnings level they enjoyed prior to the breakdown in the economy. now that the economy is broken down, the best we can talk about is stabilization, unfortunately we don't have the catalyst for growth. heaven forbid if the obama administration turns from health care and its failings to try to talk about stimulus again by bringing up a third stimulus plan, the second one is clearly not offering what people are looking for, that is incentives to invest and hire workers. we don't have the job growth you need for a recovering economy. to get that profitability going again. i fear, with european, japan and the united states, at best getting stability, you're not going to have the kind of growth you've seen in the past, therefore, the recovery rally, which is really worthwhile, relative to the fed being successful and staving off bigger problems, you don't get growth beyond that because there's nothing to give it a catalytic boost. >> bob, let's walk through this. the index heating indicators, housing starts, home sales,
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profits, all looks pretty good for all that is recovering. businesses drive the economy and businesses drive the jobs and create consumer income. 90% of the work force is working. we all obsess how bad the consumer is, if business is healing, mr. froelick, which is what i'm getting from these earnings report, how is this not a good thing. >> it is a good thing, actually a great thing. it's the same business, in my opinion, that overreacted when things looked the worst, when the pressure is the most on them. let's face it, this is the worst recession since the "great depression," a given. when things look so dismal, think what businesses were doing, laying people off, downsizing, cutting every cost they could find. in addition, they said there'll be no growth, no sales, no earnings and now all of a
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sudden, we're having an earnings led recovery. >> no, you're not. >> that will put a lot of pressure on businesses to start spending money. i think they will, first in cap ex and then employment. i think that's the second leg and the first is earning and then -- >> what numbers are you looking senate revenues are flat to down. earnings only didn't go down as badly as expected. >> hold on. >> that's not a recovery in earnings. caterpillar was one-third where they were a year ago and no offering of improvement. >> you know, joe, interesting point on this. i understand the year ago comparison, yes, absolutely, we had terrible recession, as peter has said and bob has said. jpmorgan, tom lee a strategist there has a wonderful chart, shows on a sequential basis, meaning second quarter over first quarter, we are seeing sales revenues actually rising. this is very important. only a couple of phone companies up 100%.
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>> i'd take a step back from that -- >> let me finish. 91% in health care, 78% in financial, 75% in discretionary, 75% in staples and 70% in tech and industrials. in other words, the patient is healing. the year on year comparisons don't always tell the best story. quarter over quarter, things are getting better, like the month over month numbers. if i compare every number with you every year, i would miss the turning point. my challenge to you is are you missing the turning point in sales as well as earnings. >> anything is possible, larry. clearly, we have the japanese example where they had an overindulgent economy overleveraged, went into the tank, public sector spending went up dramatic li had a too big to fail policy for banks and they got 15 years of misery they moved sideways. here's the u.s. economy now moving over, consumer dead in the water, corporations are trying to find growth everywhere
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but in the united states. all i'm suggesting a possibility we, too, are going to be rolling over. toyota motor corporation talked about how excited they'd be -- >> it's possible we might have 3 or 4% growth one quarter. that's also possible. we don't have to define ourselves relative to japan. >> all happening courtesy of a federal reserve that will stay at zero forever because the economy is sea weo week iak it afford to sustain itself. >> the economy is very bullish. >> there's no tax relief coming. >> steve moore today, ben bernanke, in this silly regulation stuff i think is sarbanes oxley for banks, we'll go there later. steve moore told the house the financial programs are running down and don't need them anymore and they stopped expanding their balance sheet. that's another sign of health.
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when you sold your family fortune today to your stockbroker, did you consider there's another positive besides the summerally, besides the improvement in earnings, besides the sequential gains, revenues in sales, the fed emergency liquidity programs are no longer necessary, mr. moore? >> i did that. i think the banks are in worse shape than you do. i do not think we're at the end of this real estate crisis. i think it could get worse. i live in an area prices still have to fall 10 to 15 to 20% to clear the market and depress the balance sheet of banks and we will have a recovery but minuscule. >> we don't need a big recovery to have a stock market surge. >> you had the surge. >> all i would say is my view on the banks is find a bank you hate and buy it. that's what i say. i so totally disagree. i agree commercial real estate big problem.
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consumer credit -- >> but it was taken over by the fdic and more coming. >> at a zero interest rate and steep curve, revenues and profits are rolling in, can earn their way out. please stay right where you are. this great debate will continue because i think the profit and economic debate is at the very heart of this summer rally and whether people will take more risk. coming up, can we fail by the s&p 1,000. what about s&p 1200. credit spreads are back pre-lehman. are we going to have a pre-lehman stock market, 1100 and 1200 and so forth. later on a top stock pick will tell you where to dive in. i say it's not too late. find a bank you hate and buy it. find a bunch of stocks you love and buy it. find some index funds. it's not too late! you're watching the k"the kudlo report." the animal spirits are improving, gridlock in washington, heck, public policy
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in washington, stand there and do nothing and capitalism will live on! the world is changing but i still believe in america and free market capitalism is still the best path to prosperity. announcer: what's your cialis moment? when she gives me that look. when at last we're alone. when we both decide. announcer: today, guys with erectile dysfunction can be ready with another dosing option from cialis. cialis for daily use is a clinically proven low-dose tablet you take every day, so you can be ready anytime the moment is right. so relax and take your time. tell your doctor about your medical condition and all medications and ask if you're healthy enough
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consider this. we've seen the third steepest rise from a bear market bottom since 1933. that's what's going on in 2009 . what's the next technical bullseye you should be looking to hit. john wilson, i recognize i don't know a thing about technical analysis. i do know from what i've heard and read, for every single of the major 10 sector is in the s&p 500 index, they're above the 200 moving day averages. sounds awful good to me. >> sounds like a great start. pretty much all the indices with the exception of the bank moved above the 200 and 50 day moving
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average. a lot of people watch those because they tend to be smoothings of trends. you can do the same thing with a ruler if you look at long term or short term chart. go back to march for a second. it had all the makings of a significant low. most stocks actually bottomed out back in october. you had fewer and fewer participating, at every major low. you came into this march low, you had tremendous negative psychology, all the things you would expect to see, extreme and major low were there, plus a lot of long term things, like a trailing return on stocks, like the relationship with bonds. we were of the opinion, it was a pretty significant low and we may be -- we think we're in the stages of a new bull market. >> carter braxton worth, what's your response to that? a new bull market. >> the critical thing is structure, not so much above or below moving average, the
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direction of that. so as right now, we are without almost -- we have no stocks in down trends, structurally, that's very important. secondly, important is the gapping going on. when results are released that force a stock to gap up, not something news related like fda approval or indictment that makes you gap down, if it's just a quarterly result and you have gaps and charts, from getting hundreds of those, that happens when the facts are so far in excess of what people believe, people have to quickly reprice an asset. gaps occur when markets start turning down in '07 and when they start turning up. >> is this up? this looks like a gap upturn. >> there are a lot of gaps to the upside. structurally, they're healing and almost no down trends. the problem this is steepness of the current move. it's quite steep, uncorrected and we think it has to rest. >> all right. real quick, john wilson, i thought stocks could have sold
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off 100 to 200 points on microsoft and amazon, and they didn't. i thought that was quite remarkable sign of strength. >> very. two months ago, i don't think there's any question we would have given up 200 points on that kind of news. the foreign markets gave us their cue and basically yawned at it and so did we. we cured a four week correction in a week and followed a little bit this week. we need to consolidate a little bit. as carter said, the rise has been pretty steep. we don't necessarily have to pull back. i'm not a believer that we have to fill gaps. >> i'm cool with pullbacks. the idea of pullbacks and corrections is the normal course of capitalistic market. >> i want to finish this out. i will pose a different question. i watch in these corporate bond spreads go back to pre-lehman levels to the summer of 2008, just about a year ago, i ask you, if that is the case, the
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message of the corporate bond market very significant, why can't we get to 11 or 1200 range, s&p was 1250 way back then. isn't that possible. >> we can, here's why not this year, at least by our work. after the big '03, '04, '05, '06, it starts to curl over. transition is low data. we're already up 8% on the year, we think we're not going to be a double digit gain year, the move to pre-lehman levels should happen in 2010, not this year. >> 2010, yes or no, you're telling investors to get off the sideline, get out of cash and go in. if you're looking for it in 2010, i say buy them now. >> i totally agree with you. >> what the heck? why wait. steve moore sold his whole portfolio today but he's not timing guy. that is one of the tragic mistakes in life. >> steve will turn out to be a great contrary indicator unfortunately. >> where is steve moore?
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is he still there? i want to see his facial expression. put him on there. he's smiling. hear these technicians, they're crawling all over you. you're not tuned out. >> thank you so much. first up, bernanke bear brighton love triangle on capitol hill. thick they spend most of their time arguing with each other. our all-star panel and steve moore will try to explain us to and his bride, alison, and joe is a little more bullish than usual and jerry boyer is waiting in the wings. i think is there plenty of time, we go to 11 to 1200 on s&p in 2010, as our two technicians suggested, heck, gee whiz, pullbacks or not, i say investors, you ought to get in. that's my view, we'll save it later on. come back to "the kudlow report," straight ahead. 7g b.
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a quick update on something outside the stock market. there was a hearing on r regulatory financial reform. we have hampton pearson with us.
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did anything come out of this? i heard them arguing with each other basically. >> for all the high minded rhetoric about the need for financial reform after the greatest financial crisis since the "great depression," what we got today, larry, was raw wounds and good old-fashioned washington turf war exposed, something washington really understands. you have the treasury secretary, tim geithner drawing his lines in the sand saying the fed should be the uber regulator as far as systemic risk and you have to have a brand-new financial protection agency to clean it up. then you have chairman ben bernanke and fdic boss sheila bair pushing back on the powers of that consumer financial protection agency and we have sheila bair at odds with fed chairman bernanke with the whole notion how do you manage systemic risk, bair and shapiro are very favorable of a systemic
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risk council with teeth opposed to the fed taking the lead. all that got exposed today. >> i can't figure out if this has any market impact at all. i ave concluded it doesn't. one thing i want to ask you, president obama in his news conference the other night for the first time unveiled an idea of financial penalties for bank whose take quote-unquote excessive risks, that could have impact. did that come up today. >> it was buried in the prepared testimony both in the fdic remark and to some degree, fed remark as well if they recast the notion of how do you deal with quote too big to fail, they want to build in some sort of penalty and up front fee structure to cushion the potential cost to taxpayer. >> i thought the biggest thing i heard reading the press report was ben bernanke telling people, i guess he must have responded to a question his emergency liquidity programs are running out and nobody wants them.
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that is significant and in my opinion, very bullish. >> you're right about that. that is part of a good news story we were trying to get from the fed and administration this week. also on the same page, something like 70 or $80 billion in t.a.r.p. or emergency funds have in fact been repaid. we all had this story earlier in the week, when goldman paid back its government money, you had the treasury secretary and others saying, by the way, taxpayers made 23% on that particular investment. >> hampton pearson, thank you very much. have a great weekend. >> likewise. >> let's go back to our oober panel and bring in jerry bowyer and have steve moore who decimated the family jewels by selling his entire family stock portfolio and we have bob and peter and bob froehlich as well. does this mean anything?
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this could be sarbanes oxley redone. >> i agree. it's this great food fight these bureaucrats are fighting one another. i think that's wonderful. when the president proposed an idea of oober regulator, it's like jump ball and ambitious and throwing elbows and head butts and sheila bair and tim geithner. i think it's wonderful. remember stockdale in the 1992 election, he kept saying gridlock, gridlock. >> that's the watch word today, gridlock. i'm trying to persuade steve moore gridlock is totally bullish, i can't even get a smile. there it is, he nodded to me. >> e what did he buy? i heard he sold, what did he buy. >> i don't think he bought anything, just cash. >> under the mattress. >> bob, you've been in the bull camp, having a good year. what are the best places to get
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in. i maintain it's not too late to get in and we're going to 1200. i know i'm a bull. if you buy the bullish case and summer rally continues with various pullbacks, what do you do? >> i just bought steve moore's portfolio, so i'm really happy. i like two sectors, financials and industrials. i do believe we will see the economy come along in the second half of the year. financials basically access capital and money for free, a great great model. i think they will continue to surprise. what i really like about industrials, i would position portfolios looking at conglomerates, machinery, subsectors that drive a lot of revenue. >> cat. >> outside the united states. that is improving. german confidence, japanese exports up and we had more
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infrastructure spending than any time in the last 18 months. i think there's more. >> steve moore, trying to make a buck, the says financials and industrials. i will emphasize financials, find a bank you hate and buy it. even a bank can make money on zero interest rate and lend it longer. and upward yield curve. >> let me tell everybody, i will sleep like a baby tonight, not because i'm crying. to my friend, jerry bowyer, i love and adock, you and i have been brothers on this. where's the growth going to come from? we have cap and trade, socialized health care, rising interest rates a 2 trillion dollar budget deficit, we don't have it anymore, it's gone, gone! >> it's free market gridlock. >> wait. wait. peter marici is jumping up and
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down in his chair. i'm kind of into gridlock now. >> i'm not. consumers will start to come back in the fourth quarter. a lot of american companies have so cut their costs they can make money and profits will rise even with moderate growth. a lot of companies like c caterpillar and ge are posed to take advantage of a lot of growth in china and indiindia. stocks are down 36% from their peak and gives me 14% more to round i see the s&p 5001130 to 1150 by the year end. >> that's a great bull predictions. 1130 to 1150. >> intel, cat, apple, starbucks, merck and pfizer. ebay, at&t, 3m, bristol myers, ford, union pacific. the point i'm making, peter, in support of your contention, is
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these improved market earnings are coming from all corners of the economy, not just one little niche. it's broad-based. on top of that, i have to throw in the banks. i think brother froehlich is exactly right. what did you say, peter -- >> 1130 to 1150 on the s&p. >> s&p closed close to 980. >> bob, your call. >> 1175 on the s&p and i think the dow will be above 10,000. >> good stuff. we'll come back and say good-bye to bob froehlich and the others and try to rescue steve moore's whole portfolio. plenty of time to ride this rally. if you're looking at 1100 or 1200, i don't know when, maybe 2010, maybe not until 2011, that means for those of you that are still on the fence, maybe sitting in cash, you can understand, risk is improving,
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the economy is turning into recovery, there's plenty of time to get in, there will be corrections and pullbacks along the way, but there's plenty of time to get in. i'm kudlow, this is the kudlow report, we'll be right back.
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we're staying with the big summer rally thing, historic stuff. let's stay with mike, he immunization the five star rated permanent portfolio fund. mike cuggino, i was reading your notes, you're not all that bullish, are you. >> in the long term, i am. i think there's many things in place for a sustainable market especially q2 earnings better than expected for the most part. in short term, my skepticism is early march to now, we moved in a tremendous upside and not sure we won't have a pullback and maybe consolidate a little bit. >> what's wrong with a pullback. not one person in a million can predict a pullback. look at today, given lousy numbers from microsoft and
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amaz amazon, everybody was looking for a pullback and markets open and the dow is up 24 points and s&p up three in a week where the indexes are up 4, 4 1/2%. in other words, pullbacks come and go, mike, why worry about it. >> we do. we're long term investors so we don't really worry about them. an investor with a strong stomach and long term, there's a lot of opportunity. for short term investor that missed the last few months, a pullback might be a better entry point. >> what do you like? >> a lot of things, like financial services. >> hold on. let's take steve moore, now an investor sitting on the fence in cash as of this morning. what would you advise him to do with his portfolio? >> the first question i'd ask him, is he a longer or short term investor? if he's longer term, i'd say a lot of opportunities. >> steve, you're nodding your
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head, long term investor? >> long term. >> there's your parameters. give steve moore some advice. he needs to get rich again. >> fair enough. the global growth story is there, like energy, commodities across the board, u.s. industrials, financial services companies, more weighted towards the asset servicers and brokerages and better than b of a and citi bank type and health care seems to be bogged down and chemicals and other things that go into the manufacturing. >> i need a response. steve, put the health care debate aside. i want you to buy energy commodities, energy is back up to almost $70, doctor copper has had a terrific run, there's your global recovery. energy, commodities, industrials, financials, steve moore, would you follow his advice. >> i think we're in a '70s, slow growth, inflation, commodities
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will rise. i believe we're in a sideways market a long time because of these crummy public policies we put in place detriments to growth. >> joe battilaglia, what advice would you give to steve to his portfolio he sold. >> we're 40% in equity, in risk but narrowly defined. i'm actually concerned the next several years. from this point going into the future, i see rising tax rates, not falling, rising interest rates, not falling. >> right. >> rising regulatory rates. >> right. >> all indebted to the society. much more indebted than before. >> that's right! >> and you have it different than before because of the leverage because of the risk. >> joe has the right story. >> you're encouraging him. >> thank you, michael. appreciate it. we will come back and work on steve moore's portfolio some more. i want jerry bowyer to come in
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and tell us why if businesses are recovering, that is good for consumers and why consumer saving is not such a great thing. now, let's check in with my great pal, dennis kneale to see what he's working on. we'll look at next week, sell-off or not. i want to look at obama dropping below 51% approval rating for the first time. is attention deficit disorder emphasis on the deficit starting to be a problem in this presidency? >> all right. have a great program, dennis. i want to know why consumer saving is a good thing, not a bad thing and how it contributes to economic growth. retail stocks have been on fire. let's visit that, too. this is the "kudlow report." we'll be right back. >> i've worked in washington and i have a pretty good idea how things can spin out of control. time somebody restored order. i know the guy for the job. >> without "the kudlow report"
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back with our panel, steve and joe.
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saying consumers saving more is bad for the economy, they can't possibly spend. i'm looking at the resail up 54 since early march, up 26% early date. that suggests consumers are saving. is saving a bad thing for this economy. >> no, it isn't. i don't get why over and over again you hear the analysis, we can't have a recovery because the consumer is not spending. if there's a dollar you don't spend, it's a dollar you save. since when does saving become bad. all the money gets spent. if it doesn't get spent on consumer good, it gets spent on capital good. consumers saving has saved a bank. >> if you invest your money, save and invest and gets into a business investment, don't businesses buy stuff? >> i don't understand what's so bad. a great thing if i go down to best buy and buy a computer for my kid but bad thing if i invest in a business and they buy a
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computer? >> joe, what's your response to this analysis? >> when we had the fastest growth in the economy, the savings rate was negative and borrowing rate was going up exponentially. now that the debt bubble has burst, the debt is falling away by losses in foreclosure and the public is running away to save money because they're fearful about jobs and future income. >> they're saving money, good, putting it in banks. banks have more capital than before. >> that's why the gdp contracts by more than 2% in the second quarter and significantly more in the first quarter because the consumer is not participating in the economy. and on top of all that, the reason why the production cutbacks businesses overexpanded to meet a demand not sustainable. look at the auto industry, 17 1/2 units at the high, now happy to get back to ten. that's loss out put and loss
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demand for investors. >> just a second. >> one at a time. jerry bowyer, then peter and steve moore. >> we don't spend the money at the mall, put it in the banks, banks are stronger, lending it out again and gets spent and more capital. >> the consumer is not borrowing. >> it's okay to have a one time recalibrati recalibration, to go from zero to 5%, if consumers stay at 5% and don't get more jobs, we go up from there and we're growing again. >> in a supplyside model, 5 moore, savings means more investment and investment goes into businesses and that sparks the economy, is that wrong? >> i'm all for savings. jerry has the story ri the problem is you're leaving out, the federal government is borr borrowing $2 trillion. that's the savings in the economy i'm really worried about. >> i am, too.
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>> you should be worried about that one. >> i think we will all agree on that, too much spending and too much borrowing, most regrettably, even with emerging gridlock in washington, president obama will be the greatest government bonds salesman in the history of america. we'll be right back. (announcer) take your time to find the right time with cialis for daily use... a clinically proven, low-dose tablet for erectile dysfunction you take every day so you can be ready anytime the moment is right. tell your doctor about your medical condition and all medications and ask if you're healthy enough for sexual activity. don't take cialis if you take nitrates for chest pain, as this may cause an unsafe drop in blood pressure. don't drink alcohol in excess with cialis. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long term injury seek immediate medical help for an erection lasting more than 4 hours. if you have any sudden decrease or loss in hearing or vision stop taking cialis and call your doctor right away.
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final words with our panel, joe b. and peter. since you're our resident bear
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tonight, joe, what's the biggest plus. >> i think the animal spirits of this entrepreneurial economy. they may be able to overcome the millstones obama economics is putting on. all explained in a wonderful book called "the end of prosperity." >> co-authored by moore and lafferty. you're on the plus sign. what has the big gus mine news the big gist minus is washington d.c. the biggest plus is everybody else. >> what's your biggest worry wart. >> cap and trade, health care, obama spending so much more than he has, 1.4 to $1.5 trillion deficits the next several years. >> what's the biggest plus. >> we moved away from financial collapse and the big minus, we may be moving into a period of stagnation. >> thank you. coming up, more of "the kudlow report." i will give you more of my biggest plus and minus.
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catch me monday morning on the call with melissa and trish at 11:00. gecko vo: geico's the third-largest car insurance company in the nation. but, it's not like we're kicking back, now, havin' a cuppa tea. gecko vo: takes lots of sweat to become that big. gecko vo: 'course, geckos don't literally sweat... it's just not our thing... gecko vo: ...but i do work hard, mind you. gecko vo: first rule of "hard work equals success." gecko vo: that's why geico is consistently rated excellent or better in terms of financial strength. gecko vo: second rule: "don't steal a coworker's egg salad, 'specially if it's marked "the gecko." come on people.
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but did you know you also get hotel price assurance? it's a one-two punch of savings -- pow! pow! lower hotel booking fees mean you get a lower total price. plus, if another orbitz customer then books the same hotel for less, we send you a check for the difference, automatically. i will agree with my
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panelists, the biggest minuses is we're spending and borrowing too much. that will slow down growth and impart inflation but not a couple years. two fabulous points from this summer rally i think has great legs, number one, profit, profits, the mother's milk of businesses. if businesses are on the road to recovery, this economy is on the road to recovery and so are consumers with it. second point, politics, yeah, i'm a reagan supply sider. here's what makes me smile. the democratic party is showing us a real conservative wing, folks worried about taxpayer interest and too much spending and borrowing. we are seeing that with the blue dogs in the house, seeing it in the senate. the democrats may be coming around. if gridlock is the first step, i'm okay with that. i think a lot changed this week on the political scene and as far as free market capitalism
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goes, i think dennis kneale, these were changes for the better. what you got up your sleeve? >> i think you're absolutely right. i want to see what will happen next week. so far, gridlock is the good message of the day, larry. have a good weekend. >> thank you. have a wonderful show. >> thanks a lot. we have a big hour ahead. "cnbc reports," starts right now. >> tonight on "cnbc reports," what a week! victory for the bulls. big gains across the board. despite dire predictions last night, bulls didn't budge today. dow up again, s&p up but nasdaq's 12 day winning streak comes to a close. tonight, we're all about the bulls, bears and your money. we're also picking winners as we look into next week. there are bumps in the way, number one, president's prescription for health care. >> america will not succeed in the 21st century unless we do a far better job of educating our sons and daughters. >> now, he's talking education. you thought obama-care would be
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expensive. wait until you hear the next plan. it's been a big week and this will be a big night. we're bringing the heat. it's the real deal with dennis kneale, "cnbc reports" starts right now. >> good evening, i'm dennis kneale. now do you believe me. i'm selling the hope on this show every night for three months. one month ago i declared this recession is over and this week, the stock market responds with a standing ovation. the dow actually added another 25 points today, s&p up a touch and nasdaq fell only a smidgen. that is a surprisingly positive end to a week in which stocks already climbed up 4% higher. what happens next week? will we feel the sting of correction and profit taking sell-off or will we see expansion of relief and hope beginning to crowd out this overdose of fear that has punished us for the past year. let's check it out in


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