Eighty-seven billion dollars for Iraq (search) – that’s what President Bush wants to build schools, hospitals and a new postal service for the Iraqi people. Now there’s a move in Washington to make at least part of that money a loan (not a gift) to be paid back in Iraqi oil.
Would that be welcome news for the stock market and the economy?
Hilary Kramer of A&G Capital says we should make the $20 billion that will be used to rebuild Iraq a loan because the American people are generous and we fought for democracy, but at some point we need to see accountability on the other side. She says there needs to be some end in sight for all the spending America is doing for investors to continue to have faith in the economy and the market.
Dagen McDowell of FOX Business News says making any part of that $87 billion a loan is a bad idea that sends a bad message to other countries that America is now turning to for help in Iraq. She says the amount of money is so miniscule that it won’t have a negative impact on our economy, and making it a loan is not necessary.
Wayne Rogers of Wayne Rogers & Company says there’s no reason in the world why Iraq can’t pay America back. The country can produce $60 million in oil a day, and when it is fully operational it should repay the $20 billion that America plans to spend to rebuild its infrastructure.
Charles Payne of Wall Street Strategies says you have to look at what we’ve done in the past – at the success of the Marshall Plan which cost the U.S. $20 billion back then and was not a loan. He says that money came back into the U.S. through commerce and trade. That said, he believes some part of the $87 billion will be issued as a loan – probably the $20 billion that will be used to rebuild schools, homes, hospitals and a postal service.
Jonathan Hoenig of Capitalistpig Asset Management says he’s worried about a high deficit here in the United States and he’s not investing in the U.S. right now.
Cashin’ In Challenge
We took a look at the standing in the $10,000 Cashin’ In Challenge. To find out who’s ahead, check out the Web site at: www.foxnews.com/challenge
Power Plan: Selleck’s Stocks
Hollywood hunk Tom Selleck has a bad attitude when it comes to Wall Street. He asks why anyone should trust the stock market? Our crew picked the stocks they say will restore Selleck’s faith in the market.
Hilary's Selleck Stocks:
Johnson & Johnson (JNJ)
Friday's close: $50.11
Anheuser Busch (BUD)
Friday's close: $50.40
Hilary says these stocks are perfect for Tom because -- just like him -- they both have brand power, and they keep reinventing themselves. She says he can depend on their dividends. Jonas says Anheuser Busch has too much debt, and Dagen says Johnson & Johnson is fighting off fierce competition. She says that’s something to watch out for.
Jonas' Selleck Stock: Instinet Corp (INET)
Friday's close: $4.74
Jonas says Tom is partially right to be skeptical of the stock market. He says the stock market is the greatest way for Americans to share in the profits companies reap, but it is also similar to a chain letter in that 25 percent of people in the market are trying to manipulate it. He says this company -- which is an electronic exchange that enables people to trade without a middleman -- is a way to tap into both those characteristics. Hilary does not like this stock. Dagen says the company has no earnings and no dividend – she doesn’t like it.
Dagen's Selleck Fund: Olstein Financial Alert (OFALX )