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Bob Sellers hosted the show this week. He was joined by Jim Rogers, president of JimRogers.com; Meredith Whitney, Fox business news contributor; Adam Lashinsky, senior writer at Fortune magazine; Alan Colmes, co-host of Hannity & Colmes; and Mike Norman, founder of Economic Contrarian Update.
Healthier and Wealthier?
Bob Sellers: If there was a tax that could make you healthier and richer, would you vote for it? A new Fox poll (search) shows the vast majority of you (73 percent versus 22 percent) would pay a new tax if it was used to cover all Americans under a healthcare plan. But if push came to shove, would America really go for that idea? And what would it mean to the economy and the stock market?
Alan Colmes: I think we should rescind the Bush tax cuts for the upper 1 percent of wealthy Americans to help pay for more domestic needs like healthcare. We don't need additional new taxes to do it. Let's just take the money we're already spending and distribute it better.
Jim Rogers: We in this country spend 15 percent of our income on health care. And we don't get good results from it. That's not the problem. The problem is the system is a mess. I would get the government out of health care. And I would get the insurance companies out of health care. And I would certainly get the litigation out of there.
Meredith Whitney: I think it's amazing the standards we use in the health care industry that doesn't survive for the rest of the industries. We have one of the highest productivity rates in the globe, but we have one of the lowest productivity rates in the healthcare industry. 85 percent of hospitals are not-for-profit. You've got to make these institutions competitive and let some survive and some not.
Mike Norman: There are two reasons why a tax would be bad. A tax would hurt the economy. We've seen how tax cuts have helped to stimulate demand. Higher taxes also hurt the market.
Bob Sellers: But 73 percent in this poll are saying, yes we would pay more.
Jim Rogers: Most doctors spend half a week doing nothing but paperwork. When I was a little boy, doctors took care of their patients. And it costs less to stay at the Waldorf Astoria hotel than to stay overnight in a hospital. Higher taxes and a new bureaucracy will not make those costs go down. Americans need to realize healthcare is not free and start paying for it themselves. That will cause them to be more selective with your health coverage, create competition and force costs to go down.
More for Your Money
Bob Sellers: Are healthcare stocks the best way to get more for your money? Adam, we just talked about the problems with our healthcare system, but what about healthcare stocks?
Adam Lashinsky: If you want to invest in healthcare, you can invest in hospitals. Even as baby boomers are aging and will have more problems and create more demand, the supply or the number of hospitals and hospital beds are going down. We have classic supply and demand that is out of whack. So hospitals are going to be a way to invest.
Jim Rogers: Insurance rates are up 40 percent in three years. We have a crisis here and something is going to pop. I don't want to be involved in healthcare when it breaks.
Meredith Whitney: The private companies are doing well, but the public ones are doing horrible. The privates ones are investing a lot in technology. The public ones are sacked by incredible cost inflation and they just can't compete.
Bob Sellers: Adam, if you want to buy a stock in healthcare, what do you do?
Adam Lashinsky: I'm going to make an extremely unpopular pick, which is Tenet Healthcare (THC). I don't own it, but it's cheap and it's also scandal-ridden which has beaten down the price. But for the future, it's an investing opportunity because their hospitals will benefit from increasing demand from an aging baby boomer generation.
Meredith Whitney: The last year and a half this stock has been atrocious. But I will say, they're planning on writing off everything this quarter. And that usually signals a bottom for a stock.
Mike Norman: I don't like it. I think it's a disaster. They're being subpoenaed. I don't think we've seen the worst of this stock.
Adam Lashinsky: I want to make clear, I'm not talking about a trading opportunity. We're playing the long term trend that we've been talking about.
Mike Norman: I like Oxford Health Plans (OHP) because. I don't own it, but I think we will get a prescription drug bill through Congress so a lot more people will be able to afford medications.
Meredith Whitney: My pick is Teva Pharmaceuticals (TEVA), which is the largest producer of generic drugs in the world. I don't own it by it is the best way to play lower end costs to consumers.
Bob Sellers: Jim, give us your solution to all this.
Jim Rogers: My solution is to not buy health care. The market is overdue for a correction and a healthcare crisis is developing. I don't expect this problem to get solved, and that's why I'm staying away from healthcare stocks.
Adam Lashinsky: I think Teva is extremely expensive. I agree with Jim that we're due for a correction. But you net that all out and you want to buy something cheap.
Head to Head
Bob Sellers: Billions of American dollars being spent to rebuild Iraq. Trillions of dollars worth of Iraqi oil in the ground. Should some of that be used to pay back America? Alan Colmes says yes. Iraq owes us some cash. I couldn't disagree more.
Alan Colmes: We were told that Iraq had all this oil to pay for their own reconstruction. Then we find out that a task force reported to the administration before the war started that the oil was not as productive as expected. And the administration never told the public this. We were sold a bill of goods about this war and now we're told we can't pay for it.
Bob Sellers: So what? At this point, whatever happened then, happened then. We now have a country that needs money. Now if we give them money and make them pay it back, at the same time we're talking to Russia and other countries who Iraq owes $200 billion to. How do we argue that?
Alan Colmes: We do believe in socialism in Iraq but not in this country. I don't think it's our role to instill our idea of democracy in these countries and pay for it with our hard earned money.
Bob Sellers: You wouldn't compare our country with Iraq. Certainly, we are a richer country than they are.
Alan Colmes: We've been running a bigger and bigger deficit since this administration has been in power. We haven't solved the problems in Iraq. Things are much more chaotic now with the guerrilla fighting that's going on. We have men and women being shot at. We have infrastructure that's not being built.
Bob Sellers: So you think they should pay back the money?
Alan Colmes: I'm saying at some point their oil will be up and running and why should the American public not have to pay if they have the money or will have the money soon
Bob Sellers: Is it in our interest to put money there to build a country that can be strong and democratic?
Alan Colmes: I'm not sure that we will be successful to create a democracy as we envision in the middle of the Arab world. What makes us think that despite all the years of fighting that we are going to get all these disparate entities together and that they're all going to get along.
Bob Sellers: Getting along and surviving together are two different things.
Alan Colmes: I don't think we're going to come in there with American tax dollars and make everything fine. We've been sold a bill of goods here that I'm not sure was right. And bottom line, I don't think American tax dollars are well spent in a country that will eventually have its own resources. It is not our role to be doing that.
FOX on the Spot
Meredith: Back to work! More jobs are created by year end and that will help the market.
Mike: Dow falls to 8800 by March 2004 due to Bush policy of a weak dollar.
Adam: International Paper (IP) shares get shredded this Monday after disappointing Wall Street with its latest quarterly report.
Jim: Lights out! More power outages in 2004. That's bad news for economy and market.
Alan: Hillary will NOT run in 2004!
Bob: Pres. Bush will pick a new running mate in 2004!