tv Cavuto on Business FOX Business October 21, 2012 8:30am-9:00am EDT
this and the e color will not be golden. >> throw it around. >> i'm not throwing him anywhere. >> you know what? the letter of the day is "c" for cavuto, cavuto on business, up next. ♪ >> neil: finally the president focusing on the $16 trillion debt, one problem, he's not our president. this president. i'm neil cavuto and ahead of the final foreign policy debate, fox on top of the nut ccking a number and maybe he has our number. iran's president questioning how long america can remain the world's number one power, with such massive de. so, if he is getting it and reminding the world about it, what are we going to do about it? is it time to start worrying about a real financial national security threat?
we have dagen mcdowell, moving a few inches away... >> no, not true. neil: we have ben stein. >> i'm happy to see dagen. >> neil: the next 30 minutes, our free be to you and wcome to all. ben stein, on the guy i like to call, lord faulteroy. >> he's nutty as a fruit cake but he's right, our national debts so large it is a national security threat and the reason is, one, it makes us look upid and impotent and as if we can't control our investing and at some point will requi us to cut or defense spending, we have to pull ourselves together an act like statesmen about it. it has gone on way too long, it is ridiculous. >> neil: dagen, he's trying to deflect and, look who is judging us kind of deal and say look at these clowns, right?
>> two an extent,but, if we don't heed this warning, i don't know what it will take. because as a nation, i don't think -- i've said all along, i don't think that until americans feel really pain in some way, whethert is significantly higher interest rates or double-digit inflation which we had in t 1970s and 1980s we'll decide to do something about this. i don't know what it will take, maybe usot being able t defend ourselves or take a national security crisis where we don't have the money to protect the nation at some point. >> do you ev notice the guy is a bad dresser? >> neil: before the united natio nations, would it kill you to wear a tie. >> he wears members only jackets as well, i haveeen them. members only. >> neil: cosmetic... >> it distracts me. listen -- >> neil: i understand. >> there is not much that he says that makes sense. the bottom line is this:
we are still the tallest midget inhe room when it comes to buying bt. >> neil: how reassuring is that. >> i'm telling you, as long as that is maintained and it will be for a while, there will be no institutional pressure from the markets r us to change. of course we have the fiscal cliff coming up, mandated by law, ifhey don't come to a deal, you get massive cuts. but unless the markets change there will be no outside pressure for us to change. >> neil: a lot more on the cliff thing, what dyou make of this guy calling us out? saying, look, a fine one to judge. the security of the -- or the stability of any nation. >> i don't think we should be taking any tips from this guy come on, you guys. look at iran. their currency is down 30% against the dollar since obama got to office, the unemployment rate among young inians is 1 in 4. the "financial times" -- >> neil: wait, that is what ours
is! >> neil, come on... >> neil: they are 25, we're 24 -- we bet 'em! go ahead. >> the "financial times" reported 1 in 9 checkshat gets written in iran bounces. the forex reserves are drying up, thas to the sanctions. i hope he's not watching the show and getting any good business advice, theoer the economy collapses the better. >> neil: it raises a national security issue, dick cheney when i say had him on and others talked about the idea, when you are in real economic dire straits,t does hurt your credibility around the world, or to charlie's point, as bad as we are, the rest of the world is worse. >> it hurts our credibility and makes people think at some point down the road they will not be able to pay for to enormous defense establishment and we'll
wait them out and when the ka no longer afford it we'll go after whatever prize we want. >> the economic thing is really worrying to me. we'll have -- they'llrobably raise taxes toeal with this stuff. and particularly, if president obama is elected. >> i hope so. >> i hope not. >> neil: it is argued that that is what will happen. >> that will be one of the worst things for the economy. if that happens, when we raise taxes, i'm not talking plugging loopholes, really raising marginal rates on a fami of four that makes $200,000, and lives on long island, hardly a billionaire, as the president likes to call them, i think will really slow down the economy and i think in this country we'll have to get used to 10% unemployment like a norm. >> not only are we fools for not demanding congress andemanding our lawmakers do something about the debt, 2/3 of the $16 trillion is owned by u.s. investors, it is owned by its -- by the social security trust fund, we are essentially -- weeds are the problem. we as a nation are the problem.
>> neil: wait, you are saying we owe it to ourselves. >> yes. >> neil: then we don't have to pay it. >> china owns less than 8% of our national debt and that includes the federal reserve, 2/3 of that... is u.s. investors -- that is bad. >> neil: why is tha bad? because... >> we're the ones, if we are willing to buy it, we'll continue to drive it higher. >> it is funneled back to the treasury and a lot of pple buy the sc, there is no -- >> it is a scam. the dollar means nothing. >> it's the fed, social security. >> investors, but -- that is what i just id. it is bad... >> neil: at that point, it is a scam and it is ours. whato you make of that? in the end, tha is what it comes down to, the world is onto our scheme and we are onto th ponzi scheme and it seems to be working and has been going smoothly. and, waiting for godot, do we
put it off and don't worry about it? >> iis a long ways off and what is not -- >> neil: wt is a long ways off? >> some kind o a -- an economic collapse based on treasuries, the treasury bubble bursting, i think -- i agree with dagen -- >> neil: wait, wait, wait. i hear a long ways off. a long ways off, could be when i'm hungry, can be like, tonight. >> look at japanese interest rates for the last 20 years, you know? people -- >> 20 years? >> yes, sir. >> neil: 20 years. >> 200 years. >> neil: that sounds as reassuring as joe biden saying the iranian threat is a good four years off. >> the iranian economic collapse is only 6 months off according to -- >> neil: unemployment, 25%, among young people. all right, we'll take a quick break here, when we come back this is it.
the final presidential debate coming up monday night and, all on foreign poly d we are all over . as we always have been, and, like we were for the first three debates. e most important names in business and politics and the most importa consequential election of our time, and we keep plugging that and if we were doing it during the depression we'd say the same thing, they didn't have cablen the depression and, if they get angry at each other, in boca raton, maybe they throw like, glasses of chablis at each other, and it continues on through midnight and the guys in the spin room get punchy by that hour and that is when we get 'em. and a lot of people say, neil i love fox news and fox business, what should i do, bill o'reilly says dvr here, he dvrs himself to watch me. catch fox bsiness and stay on us, dvr him and... 50 times
during the night, at least, up next, do any of you remember this? >> the market analysts are steadfastly refusing to mention at word, crash, to describe what is going on now, instead say look at it as a crection that still has to work itself out. but what they don't know, and worry about is how far down the correction really has to go. how long it will take and, exactly how many more people will be hurtn the process. before the market decides, if it decides, to turn around. >> high school. >> neil: 25 years ago. before puberty. an epic market crash. today, that's fine, the market looking crash-proof, looks can be deceiving. be deceiving. my toupee was [ male announcer ] you are a business pro.
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watching the most powerful name in news, foz channel. ♪ -- fox news channel. >> neil: looking at history and won wondering if we'll repeat it, the black monday, the dow losing auarter of its value, the equivalent of it losin 3,000 point today and a lot of things happening, 25 years ago, leading to the melt down including a growing housing bubble and growing government debt, the dimensions of which we couldn't appreciate and tay record high debt and many say a bubble in interest rates. thks to the federal reserve printing money on steroids, looking too similar to charlie
grass pre gasparino. >> whei was there, i was at the university of missouri, and back then, we were worried about the deficit and had gram ruddiman, and, whatever cuts they did, clinton came into office, and he raised taxes and did it cure t deficit? look at the numbers, it di but what killed thedeficit, economic growth and when we hav these discussionbout raising taxes and cuttin the one think we're light on is the fact when you grow the economy, deficits -- >> neil: you can't boom your way out of it. >> if we knew how to create a bomb we have won it but the crash of 1987 was not macroenomic phenomena, it was micro economic phenomena, portfolio insurance, when you guys were in elementary
school... >> neil: everything is sparked by something... >> portfolio, they sold the futures -- >> neil: i'm well aware of that why didn't it happen at any prior moments. >> there was not massive portfolio insurance and it was not triggered. >> neil: no, no, the degree of professional insurance out there was higher in 1986. my point is, there is always a trigger that tests the computers. >> whatever e trigger was, it was portfolio insurance, the market recovered, very, very quickly. there was no economic crash. >> neil: there was no depression, you are right and dagen the fears we'll see a world economic winter was proven wrong but -- >> but that was -- that was a -- >> neil: a couple years later. >> listen,e had an snd l, what are we missing, the s & l crisis and the junk bond crisis. >> neil: i'm not blaming it on that. >> by 1989 we're in a recession. >> two years later. >> markets are forwa
predictors. >> that crash... that crash, 25 years ago, was... >> neil: won't change your mind. >> it is ttally right. >> neil: we'll see about that. i think i know -- you saw me, in my pre-puberty stage, pontificating okay, please. you were doing hollywood movies, you were clueless. >> i remember the discussion with alan greenspan. >> dave: what year d you do bueller. >> 1985. >> the economy slowed down -- >> here's my point, that was a stock event, an equity event. what we have now, with the bubble, in bonds and particularly in treasuries and how dangerously expensive they are and what could happen is much more grave, potentially because we're $16 trillion in debt. >> neil: that raises a very -- that is where it comes into play, how it could be different, this go-around. it would be an outside catalyst maybe in washington, and the gig is up, so to speak, that the --
that hits everyone at the same time, and i don't know if it is a fiscal cliff or whatever, what do you say. listen, i agreehat very, very low interest rates, they are unjuified. i also agree it is a real problem and the problem, scary thing is that it will hang around for the next five or ten years and aot of older americans who are invested in treasuries are actually going to miss o on income, they should be moving out of those gently into better investments. and, that is actually... >> neil: like what? like what. >> mid grade bonds and preferreds. >> that is and somewhat of an absurd statement. no, it is not. >> neil: you pointed -- >> here's why, the stock market is being buoyed, pumped up by 0% interest rates, the thing you said shouldn't happen, they should raise interest rates. once interest rates -- >> stocks are cheap right now. >> when stocks -- will they go up or down when they raise interest rates? they will be raising interest rates. >> metrics... >> they are not going to -- the
stock market will not be correlated to it, whether the fed raises interest rates? >> the fed will not raise interest rates for a long, long time. don't worry about . >> it depend on who is president, romney is president, pressure on ben bernanke -- >> if you can predict the future of interest rates, you can do something nobody in the history of the world has ever been able to do. >> i like the peter brady moment, where your voice changes on camera. i want to see that again. >> you looked like wayne newton. >> neil: you are all having... >> all rig. >> stick shock at the grocery store, americans are feeling the puh and these guys... up next, here, are you ready to jump off the fiscal cliff? apparently the white house is ready to veto a fix and take the plun, we report, why republicans and their reactio might want to make you hide. 4g lte is the fastest.
so, which supeast 4g lte service would yochoose, based on this chart ? don't rush into it, i'm not looking for the fastest aner. obviously verizon. okay, i have a different chart. going that way, does that make a difference ? look at verizon. it's so much more than the other ones. so what if we just changed the format altogether ? isn't that the exact same thing ? it's pretty clear. still sticking with verizon. verizon. more 4g lte coverage than all other networks combined.
bipartisan plan if it doesn't include tax hikes on the rich. bringing everything to a halt. forget about coming together, ben stein. it look like they're driving further and further apart. >> we don't know but i would not like to say it would be good. a tax increase, spending cut, unceainty about the future not good for a fragile economy and it's a disgrace the president and congressannot work together. if it's mr. romney they'll be able to work it out. mr. obama, he's too dug in. >> he's baed off this before and extended the bush tax cuts. >> if he's reelected he won't. >> can we blame both sides? they didn't want to do hard math and pay for tm so we keep moving it down the road. >> i think that is a -- i'm from -- i agree with this.
this is obama's way of dealing with the deficit. tark particularly in democrats pick useats in the senate. >> he talks about a mandate. >> he's going to say i'm done, you don't want to raise taxes on the rich, deal with the deficit this way. we'll ha a recession for about aear and things might look better. >> do you think the likelihood -- i know your answer but hope springs eternal you'll surprise me. that the chance for real tax reform are better under a republican than a democrat because the president is more of the same. that might not be bad but it -- do you think you have a better shot as serious tax reform under a republican? >> i think there will be a better shot at tax changes under repuican but unfortunately they won't be help. by the way, the best evidence is that everything's calling ts a cliff. it's not -- there will be a deal. >> we'll get a bipartisan --
index fund. they tend to do well. sdy, a high dividend stocks. it'sen an index fund that does well over long periods of time. that's what we're doing. >> neil: would you plaall three together? one is stronger than the other. >> no, they're not -they could all be strong at the same time. what wldill and i am playing them all at once. >> neil: you argue for fun. >> unless your name is buffett. >> or stefan. >> god bless ben because he's responsie but the fact is people are tuning in for cool stock picks. you can learn a lot from owning individual stocks. >> neil: what about any of those choices he just blurted out? >> my comaint is he's telling people to buy stuff they