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    Bulls & Bears | Cavuto on Business | Forbes on FOX | Cashin' In

    Bulls & Bears

    This past week’s Bulls & Bears: Gary B. Smith, Exemplar Capital; Tobin Smith, ChangeWave Research; Eric Bolling, Fox Business News; Pat Dorsey, Morningstar.com; Nancy Skinner, Radio Talk Show Host

    Dow Rockets Up 9% This Past Week (March 9-13); Market Telling Us Worst Is Over?

    Eric Bolling, Fox Business Network: We've got to embrace this rally. It was a great week. Banks are making money again, GM might not need additional government money—there was a lot of good news. Whether it's long-lived or not, embrace it. Tech and major consumer stocks have remained relatively strong. There could be another leg to this rally.

    Gary B. Smith, Exemplar Capital: My greatest concern isn't that we had a great week. My primary concern is that the markets rose straight up this past week. Often, this is what we see in a bear market rally. These V-shaped rallies in a bear market usually just peter out.

    Pat Dorsey, Morningstar.com: My position is that stocks are cheap right now. If you buy stocks now, three years down the road you'll be doing great. In the short run, emotions rule. There were a lot of people covering their short bets this week, which helped push up the markets. Like Gary, I think these V-shaped rallies are not sustainable. We could go lower again. My bet is that this recession will be more W-shaped by the time we get through it.

    Tobin Smith, Changewave Research: By definition, this is a bear market rally. Bear market rallies are infamously fast and furious. This last week, a lot of people who wanted to sell stocks already had, so buyers pushed the markets up. I think the Dow will probably get to 8,000 or so. But more bad news about the nation's banks is coming down the pike, and the markets will head back down. A bump is not an "investible" event.

    Dems Launch War on Secret Ballot; Wal-Mart Fights Back!

    Tobin Smith: If this bill is passed and if businesses want to fire someone, they'd have to use an arbitrator. This will destroy jobs and investment. Research shows that companies that get unionized invest 15% to 20% less in their company due to higher costs. This is the wrong time for a bad idea.

    Nancy Skinner, Radio Talk Show Host: This bill does not eliminate use of the secret ballot. It simply provides another option for workers to form a union. If workers are able to earn more as union members, they can buy more stuff from Wal-mart. They can buy more cars from Detroit. It helps the economy get back on its feet. This is exactly what we need, and the economic logic for it is perfect.

    Eric Bolling: Just look to the American automotive industry. If you go to Detroit, workers there get paid $78 an hour including benefits. You go down to South Carolina, to a BMW plant, and they get paid $43 an hour and actually help return a profit for the company. Many companies are on the brink right now. If you allow workers to organize, you'll put many of these companies over the edge.

    Tobin Smith: There's no question this is a pro-union bill. It's true that union workers do make about 15% more than non-union workers. The problem is the artificial cost levels in place in unionized industries. That's why unionized industry slowly but surely goes out of business. It's not a coincidence that this country experienced its highest rate of growth in the late 1800s and early 1900s when a very small percentage of the country was unionized. Since then, we moved toward the ways of Europe with overly high wages, bloated infrastructure, and less efficiency.

    Pat Dorsey: I don't want to simply say unions are bad, non-unions are good. There are some very successful unionized companies like Southwest and UPS. That said, there are provisions in the bill that are mistaken in terms of a mandatory arbitration clause. It's a horrible idea to bring in someone who's not involved with the business to make employment decisions. And frankly, we have bigger economic fish to fry right now. Fixing the economy and financial system should be our concern, not stuffing through every hopeful social program that Congress can come up with.

    Congress Keeps Automatic Pay Hikes Forever! What?

    Gary B. Smith: Congress keeping its automatic pay hikes just shows how out of touch it is with reality. With a simple stroke of the pen, they could have shown that we're all in this together. It sort of says screw you to the American public, we're getting our money. It's idiotic.

    Nancy Skinner: This year, Congress is not giving itself a pay increase. But what's funny about this argument is that the same people who say bank executives should receive massive bonuses to attract good talent don't want to raise the salary of Congressional members. If Congress had to vote every year on a pay raise, it'd never happen because it'd almost always be a political hot potato.

    Eric Bolling: If we actually had good talent in Congress, I'd want to pay them more. Congress iced its salary increase this year, but still took tens of thousands of additional dollars for each member towards office discretionary spending.

    Tobin Smith: This shows every Congress is an equal opportunity spender. It takes a lot of gall for Congress to demand financial institutions taking TARP money to cap their executive pay, and yet Congress itself continues its practice of automatic pay raises.