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WOULD ROMNEY'S PRIVATE EQUTITY EXPERIENCE BE HELPFUL OR NOT IF HE WAS PRESIDENT?
Steve Forbes: A huge qualifier. He understands that the common good means prosperity, enabling people, starting out or trying to get ahead to have the opportunity to do so. That means less taxes, less regulation, less government spending, and a sound dollar. Romney's lived through it, clearly Obama has not, which is why the economy is stalled today.
Rick Ungar: Certainly not a disqualifier, I don't have a problem with him being a venture capitalist, but if being quick with a balance sheet was what it took to be president of the United States, we could go grab Bernie Madoff and bring him out to run for office. Romney got himself into this mess. I'm simply suggesting that being good with a balance sheet is not a qualifier to be president. We have to take a look at how this happened. Romney put this on the table when he started talking about how he created 100,000 jobs at Bain Capital. Look, Bain Capital isn't there to create jobs. That's perfectly fine, it's okay. It's there to make a profit for its investors and the money that they manage. But by discussing that he's a good job creator, he opened the door to this discussion. I don't know why he did it, I don't think it was smart to do it-now that number is down to 10,000 jobs created. He created this situation. I don't care that he ran a venture capitalist firm.
Victoria Barret: This hints at a fundamental theme in this election, which is does government create jobs or does the private sector create jobs? The fact that this administration is attacking private equity, I find so fascinating because how can you be successful as an investor by destroying companies and therefore destroying jobs. That means you're not successful, you're not going to make a profit, and the companies won't survive. Bain was in the business of propping up companies. Their hope was that these companies would survive. It was risky and sometimes it didn't work, but the goal at the end of the day was that these companies would survive. And, that their investors, Bain's investors, were largely pension funds. A lot of government money is benefiting from Bain's success. So, it's a real hypocrisy on the part of the administration and shows a disconnect with their understanding of how American capitalism works.
John Tamny: If Mitt Romney were a bad job creator or a bad overseer of profitable businesses he would not be rich today; we would not know who he is. He's obviously very good at it. What concerns me is does he have the courage to make the essential point that in order to create jobs, very often you have to destroy them first. Businesses are in the business of profit to attract the investments you need to grow sometimes, you need to terminate positions that are dragging down profits. I'm skeptical that Romney is willing to make that point.
Mike Ozanian: I think the one area that Mitt Romney or any person who has ever run a business, even if it's a local drycleaner, can really help and has much more experience than President Obama in the areas of regulation. There was a George Washington study that said in Obama's first two-years new rules and regulations on new businesses cost the economy $10 billion a year. That is more than twice under President Clinton and George W. Bush. New rules and regulation are a burden on businesses and job creation which is why the labor participation rate is at its lowest participation point since 1981.
Elizabeth MacDonald: That's the best way to screw a congressman, is to put them in the private sector at business. I agree, but there are so many double standards. So many top democrats including Bill Clinton, Al Gore, John Edwards, Wesley Clark, Tom Daschle; all went to work at private equity companies after they left office. The other thing too, to get at President Obama's record, he's practicing with Jim DeMint, rightfully called venture socialism. He has blown out the government's balance sheet to equal the size of Germany and South Korea-five trillion added. He's blown a lot of money on bad green energy companies, like Solindra, like First Solar, Beacon Energy; you name it, Ecotality, all sorts of companies that failed. He is, himself, practicing private equity type venture socialism with taxpayer money and he's not doing a good job at it. He's not creating jobs.
FEDERAL JUSTICE WORKERS' JUNKET TO HAWAII: GOOD OR BAD USE OF TAX DOLLARS?
ELIZABETH MACDONALD: The U.S. taxpayer does not work for the government or work for their vacation tours that read like something out of Expedia.com. The U.S. government works for us, the U.S. judges work for us. What's striking here is that the 8th circuit is taking their vacation at the Kansas City Marriot. They should be doing these meetings via Skype. The 9th Circuit Court is the worst court in the country in terms of having its rulings overturned by the U.S. Supreme Court, 107 rulings between 1999 and 2005 overturned. I say spend the tax payer money on breaking up the 9th circuit between 2 or 3 different courts.
MORGAN BRENNAN: Going back to the 9th circuit, and if it's such a bad circuit court, that's all the more reason to have a conference. So you can have more attorneys and judges meet and powwow - I would say yes in Maui because Hawaii is part of the 9th circuit court and the truth to the matter is that they have been holding these conferences in Hawaii for years now. Going back to Kansas City, they are saying that the lodging costs are $200 a night, Midwest is markedly less expensive than the west coast and the prices of lodging in Hawaii are only $200 a night. So if this is going to help them meet in person and improve their judicial system they should do it. They have been doing it for years.
STEVE FORBES: The 9th Circuit is especially egregious in terms of their fishing expeditions with the constitution always getting overturned, no reason to subsidize fishing expeditions to Hawaii. Junk justices don't deserve junkets. This comes at the taxpayer expense. If they want to improve their judicial decision making, how about reading the constitution again? That won't cost very much.
RICK UNGAR: I'm not quite sure why this junket about the 9th Circuit is relevant, but I will agree that the optics of travelling to Hawaii at this time and spending $1 million on a conference is a bit over the top. But we do have to say this, the 2 Republican senators who are launching this attack over this, what they aren't telling you is that congress has written a check to the republican and democratic party, our taxpayer dollars, to pay for their conventions this year. Let's be a little bit consistent, don't go after the 9th circuit judges-about I'm talking about the 2 Republican senators who are making a big fuss over this while they are taking our money to pay for those conventions.
JOHN TAMNY: For once I agree with Rick, we shouldn't be pay for the Republican National Convention, or the Democratic National Convention, I will bring some local knowledge to this, the local 9th Circuit, I grew up near it, it is in a beautiful old resort itself. The idea that they need to go to Hawaii to contemplate constitutional issues is hurl inducing. They are already in a resort stick around California and get your work done there. This is offensive, and to think, we are going to pay for this.
MIKE OZANIAN: I'm kind of glad this happened and EMAC brought it up because when we have the president talking about why he has to raise taxes on successful people in the name of fairness, this shows where this money goes. It goes to wasteful spending. For this to happen when the economy is really bad I think it goes to show how bogus the President's statement is.
FLIPSIDE: HOME FLIPPERS COMING BACK: GREAT NEWS FOR HOUSING MARKET!
MORGAN BRENNAN: I do say this is great news. Currently investors say they make about 20 percent of all home sales each month and the big reason we are starting to see some stability I the housing market. It's important to define what today's investor is. We are not talking about greedy, over mortgaged house flippers from the housing bubble. We talking about people who are going in, mostly all cash, going in and buying all the rundown half build, dilapidated, bank owned houses that nobody else wants. They are going in, fixing them up, transforming them and in many cases they are becoming landlords and given the fact that we have had about an additional 4 million Americans jump into the rental market since 2006. That's inventory that we really need. The fact that they are cleaning up these houses helps all the home values of all the neighboring properties.
MIKE OZANIAN: I think that when you have people that come in and buy rundown homes and fix them up, that's great. What I'm concerned about, is that this is a policy largely engineered by bad monetary policy by the Fed. Namely it's been buying long term bonds selling short term bonds to artificially keep interest rates down. Mortgage rates are artificially low. The housing market is not going to become robust again until real wages go up, and that's not happening.
STEVE FORBES: This is good news, the government has actually suppressed the housing market trying to help it in the last 3-4 years and the fact that people are coming in with their own capital to do it is great. It would help even more if Fannie and Freddie which are also supposed to help the housing market allow people to buy more houses than the handful they are allowed to buy today. They should turn them into rentals or to resell them. People willing to put capital at work, that's great.
JOHN TAMNY: This is bad news to me; I'm on Mike's side with this one. Does anyone here think we would be seeing all this speculation if the government weren't cheapening the dollar if the Fed weren't looking for ways to make interest rates artificially low on mortgages. Housing, despite all the other protests otherwise, is a dead money consumptive sector. When money flows into housing, It's not flowing into software, and cancer cures and things that matter in the economy. This is not a good thing; it's a sign that we are moving backwards.
VICTORIA BARRET: I think this is a sign that we are moving away from the notion that was kind of a negative driver of this last downturn, that everyone should be a homeowner. My sister just bought an investment property in Morin, a foreclosed property, and her most likely renter would be a family that was in a foreclosed home. So they are owners that should not have been owners, and they will now be renters. That's a healthy sign in the market. That people who should be buyers, be buyers and people who should be renters, are renters. It's a good thing.
STOCKS FOR ALL AGES
ELIZABETH MACDONALD: Archer Daniels Midland (ADM)
52-WEEK HIGH: $33.98
52-WEEK LOW: $23.69
MORGAN BRENNAN: Helmerich & Payne (HP)
52-WEEK HIGH: $73.40
52-WEEK LOW: $35.58