• Neil was joined by Jack Welch, former GE Chairman; Ben Stein, author of Yes, You Can Time The Market!; Jim Rogers, author of Adventure Capitalist; Gregg Hymowitz, founder of Entrust Capital; and Gary Kaltbaum, president of Kaltbaum & Associates.

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    Neil Cavuto: bin Laden (search) and his lieutenant calling for more violence against America. And the market did not like hearing from Usama. Stocks took a big hit as soon as that tape hit the airwaves last Wednesday. Jack, should investors and America still be worried about Al Qaeda?

    Jack Welch: Terrorism is with us and will be a way of life for us. Usama is just a symbol of what's out there. I don't think investors should be more worried with the new video that has come out. You might get a daily blip in the market, but I don't think it changes any fundamentals. We have to win the war on terrorism.

    Gregg Hymowitz: And if we're going to win the war on terrorism we have to fight the terrorists. I think a mistake we've been making is that we've been fighting states and not the organizations of these terrorists. And I think if you do that then you don't have to spend $4 billion a month rebuilding the states you destroy.

    Ben Stein: I think Hamas is going to try and compete with Al Qaeda and Usama to try and even be more terrorist. I agree, we have to win this war, but we need a much bigger defense establishment. Whatever it takes, if it takes bigger tax cuts or bigger deficits.

    Neil Cavuto: You'd repeal the tax cuts to up the ante on the war on terror?

    Ben Stein: If the choice were to have inadequate military establishment or repeal the tax cut, I'd repeal the tax cut.

    Jim Rogers: Even if Usama bin Laden is dead or alive, it doesn't matter, they are recruiting a lot more people to come and attack us in Iraq. And they're coming from all over.

    Neil Cavuto: The fact of the matter is there are hiccups when these new videotapes come out. What would happen if all of a sudden these tapes stopped and we had proof that Usama bin Laden were dead?

    Jack Welch: The biggest concern is complacency. We had forgotten somewhat until this new tape came out again. But this is something that fundamentally changed the long-term all over the world.

    Ben Stein: We have a billion militant Muslims who are mad at us. It's up to us to protect ourselves. Nations create their own security. If we defend ourselves I think the markets would be very secure.

    Gregg Hymowitz: But it's not just psychological. I'm sure terrorists have cost General Electric hundreds of millions of dollars in changing the way they do business. Terrorists activity really has an effect on economic stability.

    Jack Welch: But they'll be a lot more after Usama. If we find him and he's dead, they'll be another one right after him. Maybe ten more Usamas.

    Neil Cavuto: Assuming al Qaeda is still a front burner issue, Gregg what do you do?

    Gregg Hymowitz: I think if there is going to be another attack we can all agree that treasuries are the place to be. Possibly gold. I don't know if you can invest long-term based on terror, but defense is one area that would continue to get government money if there is another attack. One company we like and own is Boeing (BA). It may take two years for the commercial aircraft business to come back but as the defense spending goes up it's always a good play.

    Ben Stein: I love the Fidelity Short-term Bond fund (FSHBX) as part of a very diverse portfolio. I own it.

    Neil Cavuto: Even in the face of interest rates going up?

    Ben Stein: It's a short-term fund. It yields a little more than a money market account.

    Neil Cavuto: Assuming the Fed won't do anything.