DISCLAIMER: THE FOLLOWING "Cost of Freedom Recap" CONTAINS STRONG OPINIONS WHICH ARE NOT A REFLECTION OF THE OPINIONS OF FOX NEWS AND SHOULD NOT BE RELIED UPON AS INVESTMENT ADVICE WHEN MAKING PERSONAL INVESTMENT DECISIONS. IT IS FOX NEWS' POLICY THAT CONTRIBUTORS DISCLOSE POSITIONS THEY HOLD IN STOCKS THEY DISCUSS, THOUGH POSITIONS MAY CHANGE. READERS OF "Cost of Freedom Recap" MUST TAKE RESPONSIBILITY FOR THEIR OWN INVESTMENT DECISIONS.
Bulls & Bears | Cavuto on Business | Forbes on Fox | Cashin' In
On Saturday, Jan. 16, 2010 Brenda Buttner was joined by Gary B. Smith, Tobin Smith, Pat Dorsey, Eric Bolling and Sarah Flowers
Crisis in Haiti Growing More Urgent by the Hour
Gary B. Smith, TheChartman.com: We're all at the end of the day, fellow human beings. We have to ask ourselves, "What's the right thing to do here?" It should be done regardless of the misgivings of some countries. The most important thing to do is help out the best we can with money, people and resources. I'm proud President Obama is working with other leaders to try and help Haiti out to the best of our abilities.
Tobin Smith, NBT Media: America has always been the most generous society for decades, going all the way back to the Marshall Plan. Today it's so much easier to do the right thing, like being able to send $10 to the Red Cross through text messaging. The success we've had in this country comes with responsibility. We do the right thing because it's in our heart and in our nature to do so.
Pat Dorsey, Morningstar.com: We have to distinguish between the people of a nation, and the government of a nation. Haiti has had many problems over the years. But pragmatically, giving this level of aid and assistance to Haiti is good for our brand. America isn't just a place, it's an image, it's an idea, and it's why we attract the best and brightest to this country. When America steps up, we're not only helping the people of Haiti, we're helping our own global image.
Eric Bolling, Fox Business Network: We committed $100 million so far, 10,000 troops, etc. Other well-off countries, like China, have only ponied up about $4 million, and a few dozen aid workers 'til now. When disasters like this happen, people first turn to God and then to America and ask for help. That's fine. My problem is that when a disaster isn't going on, we're the bad guy, until other people need our help.
Did Reid's State Just Prove We Can't Afford Health Care Reform?
Bolling: Harry Reid is on his way out. Nevada now wants to drop its role in Medicaid given its rising costs. Harry Reid is really just out of touch with what the people in his own state want, not to mention the majority of people in the country.
Sarah Flowers, Democratic strategist: All this proves is that the Nevada governor is playing political ball. He's operating on the assumption that most people in his state don't know specifically what's going to happen with health care reform. Ninety-five percent of all new costs will get covered by the federal government until 2014--plenty of time for states to figure out how they're going to pay for it. Not to mention, people will be able to access better care for less cost. This will help states out in the long run.
T. Smith: Nevadans know how to do the math. Nevada has one of the highest rates of unionized health care in the country. They can see the state will be upside down $800 million with health care reform. Nevada's governor sees this and, for obvious reasons, wants a deal like Nebraska got with all its new costs being paid for by the federal government. Otherwise, he wants the federal government to get lost.
G. Smith: The states only get half the funding for new Medicaid expenses. After 2014 all the costs fall on the states. The real costs of this reform are going to be incurred by the states, not the federal government. This is why so many states are opposed to health care reform. People are starting to wake up to just how badly they're going to get hit with this legislation, and I think we'll see more and more states threatening to take action like this.
Dorsey: Unfortunately, this bill doesn't do nearly as much as it should to reduce costs for health care reform. That's what really depresses me. There's so much in this legislation that should be there that isn't. Finally there's the political will to reform health care in this country, and Congress just totally misses the point. The biggest thing we have to worry about with health care is its rapidly rising costs, and doing something to help prevent this. But that's just not the case.
GM, Chrysler, Fannie, Freddie Not Paying Bailout Tax; Why?
T. Smith: The hypocrisy or stupidity on this issue--I don't know what's bigger. Let's look at the hypocrisy. The government said companies had to figure out how to pay back TARP funds within five years. The big ones paid them back in less than a year and a half. These companies played exactly by the rules. The government made money on the TARP funds it gave out. Most of the big banks we're basically forced to take the TARP money at gunpoint, and now they get hammered for it. It's ridiculous.
Flowers: This isn't the best deal out there. What's important is getting the TARP money, the taxpayer's money, back in full. Hitting Fannie and Freddie with this tax would basically be shuffling money from one pot to the other since the government already owns the two companies. GM and Chrysler are probably in too weak a financial position to start getting hit with a tax like this. It's very important we keep those two companies standing, especially given the taxpayer's stake in them. While they're still in the restructuring process, it makes sense to not hit them with the tax.
Bolling: The consumers are going to get hit by this tax. Banks will ramp up ATM fees, checking fees, etc. Consumers are picking up the slack. And this was the government's mistake for not ensuring TARP funds would be used by the banks to continue giving out loans to consumers. It's the government's fault for not ensuring that. And it's wrong for them to be hitting the banks like this after the fact, especially when they've paid back their TARP funds to the government's profit.
G. Smith: This makes my blood boil. This is a get re-elected tax. As soon as Obama says "Wall Street fat cats" everyone says "Yeah!" and riled up. Barney Frank said it's entirely legitimate to make banks pay this tax given the damage they caused to the financial system. And Barney Frank was key in encouraging Fannie and Freddie to expand mortgages to prime time borrowers. These banks paid the money back. The government has no business implementing this tax.
Dorsey: Everyone is angry at the banks, so take them for all they're worth. It's pretty silly regulation. GM announced today one of its board members was going to be a special adviser to the CEO for $900,000 a year! Just for giving advice! Yet we don't see any anger or outrage about that decision.
Predictions
G. Smith: Goldman still golden even with bank tax! "GS" doubles in two years
T. Smith: Don't pay baggage fees, ship it! "FDX" flies 30 percent in one year
Dorsey: Gas up on natural gas! "ETP" fuels 50 percent gain in two years
Bolling: Can't stop Americans from eating salt! "YUM" eats up 30 percent in six months
Bulls & Bears | Cavuto on Business | Forbes on Fox | Cashin' In
On Saturday, Jan. 16, 2010, Neil Cavuto was joined by Charles Payne, Dagen McDowell, Adam Lashinsky, Ben Stein and former U.S. ambassador to the United Nations John Bolton
Unions Get a Pass on Health Care Tax; Bad Deal for Taxpayers?
Charles Payne, WStreet.com: This is crazy. Government workers and union workers keep getting richer and better off these days. The terms of their deal from health care just keep getting better. Meanwhile, everyone else is hung out to dry. Whatever happened to shared sacrifice? This legislation is now going to hurt non-union workers on Main Street even worse that it was going to originally. There's just no solidarity here, and it's sad.
Dagen McDowell, Fox Business Network: This was the most disgraceful political handout and outrageous symbol of favoritism we've seen in a long time. People who don't work in unionized companies are paying a huge tab for this. And the vast majority of people who work in the private sector don't work for a unionized company. Union workers get a free pass while everyone else ends up paying for it.
Adam Lashinsky, editor-at-large, Fortune Magazine: We're making sweeping generalizations here. These unions gave things up along the way to get the good health care plans they have now. They made pay concessions in order to get better health care plans. This political block got a good political deal. This isn't any kookier than Ben Nelson turning reform his way to get his vote. Stuff like this happens all the time in the legislative process.
Ben Stein, author, "How to Ruin the U.S.A.": This is entirely business as usual. I'm the member of several unions, and I love unions. But of course this administration is going to favor the unions--it's extremely left wing. This is just politics, and high earners and small business owners are going to get kicked in the teeth for this. Obama is appeasing his political constituency, just as Republican administrations try to enact legislation that benefits their constituencies. But make no mistake; this is a big kick to a lot of taxpayers.
How Can We Make Sure Aid to Haiti Gets into the Right Hands?
John Bolton, former U.S. ambassador to the United Nations: There are different phases to what's going on in Haiti right now. One reason that thousands of American troops are headed to Haiti is that the Haitian government isn't really capable of participating in this relief effort. The NGO relief organizations there don't have the logistical wherewithal that the U.S. military can bring with it. I'm confident about what we can do in Haiti as long as the U.S. is there distributing assistance and aid, and making sure it gets to the people who really need it. The larger question is what comes of the reconstruction effort. There's a lot of risk of aid not getting where it needs to go if the U.S. reduces its presence in the country.
Payne: As long as the U.S. military is there controlling things, I think things will be okay. We know all too well of past historical examples where dictatorships got enormous amounts of aid and used it to enrich themselves and strengthen their power over their respective country. Right now, I think we can count on the aid, money, and supplies we're sending there to get to the right people, but we can't take our eye off the ball down the road.
McDowell: We have no way of knowing if some of the aid and money goes missing. But I think in the end, our very nature as a country is to keep giving to people who are truly in dire need of help. To help offset any waste or abuse of money and aid going through the government, we hopefully encourage the work and assistance of private relief organizations who can far better track where the money and aid is going. It's a far more efficient and effective way to manage and monitor the distribution of aid.
Lashinsky: It's interesting to note that most aid organizations like the Red Cross have specifically requested that people donate money, not supplies. They want and need to be in a position to purchase and move the aid and supplies they need most given the changing situation on the ground in Haiti. We really should be proud of what our country is doing right now, and the fact that we're able to do so much so quickly to help the people of Haiti out.
Stein: This relief effort is largely going to be ad hoc. Haiti is the poorest country in the hemisphere--a fantastically corrupt country, and unfortunately I think a large amount of the money could be wasted. That means we have to send more. One-hundred million dollars is a lot of money, but that comes down to only 30 cents per American. But at the end of the day, these people need our help, and if we have to waste some money to do so, so be it.
Google's China Threat: Good Move for America?
Bolton: I think Google's move to pull out of China could set an enormous precedent. The U.S. is not the end game, but much of American businesses think they have to enter the Chinese market. But we don't like what the Chinese do--ripping off intellectual property rights, or not enforcing contract rights. But many U.S. businesses suck it up and deal with it because of the immense size of the Chinese market. If Google goes through with this, it's a real signal to China that it can't get away with anything it wants.
Stein: This could change things a lot. A lot of American businesses and even the U.S. State Department have taken a lot of flak for not standing up to China and letting it get away with a lot of bad stuff. Google deserves a huge thanks for saying they're not going to take it anymore, and hopefully other American companies will follow suit.
McDowell: The issue here is that the more it seems China is given, the more it takes. This hacking attempt really was the red flag and last straw for Google. Many human rights activists had their accounts hacked into. And thankfully, Google said enough. Google has been putting up with some censorship in China for years. YouTube has virtually been shut down in China. If their model is "don't be evil" they have to do something about what China's up to--and they are now.
Payne: Many, many U.S. companies are cooperating with the Chinese government so they can get access to the country's market. It's just too bad so many U.S. companies have felt this need to cater to the Chinese government. But now, the Chinese may finally begin paying a price for their actions.
Stocks You Can Trust
Lashinsky: iShares MSCI Canada (EWC)
Payne: IBM (IBM)
Stein: iShares Emerging Markets (EEM)
Bulls & Bears | Cavuto on Business | Forbes on Fox | Cashin' In
Forbes on Fox
On Saturday, Jan. 16, 2010, David Asman was joined by Steve Forbes, Rich Karlgaard, Neil Weinberg, Mike Ozanian, Quentin Hardy, Victoria Barret, Mike Maiello, and Evelyn Rusli.
Corporate America Helping with the Rescue in Haiti
David Asman: The frantic search is still on in Haiti as rescue efforts begin turning into recovery efforts. Now a new worry: could widespread disease cause more death? We'll go live to Haiti in just a few minutes. But first, American businesses are rushing millions in aid to help these victims, many of them, the same companies being vilified in the press and in Washington as nothing but greedy grubs. Is that fair?
Steve Forbes: I think the companies are doing right, and it's fitting and proper, and I hope we make use of companies that are good at logistics, like Fed Ex, UPS, Wal-Mart in terms of handling large supplies very quickly. But don't expect thanks for it, just as we did not get thanks for what the military did in the tsunami five years ago in the Pacific. They did a fantastic job, didn't help the image of the United States, but it's right to help, and so we should do it.
Rich Karlgaard: And I'm glad they're doing so once again. You know, David, normally I am not for corporate charitable giving because after all, shareholders own a company, and shareholders are rarely consulted on corporate giving, but this is a humanitarian disaster and calls for an exception. The one thing I would like to see is that the credit is widespread, because we the people are the shareholder of this company. I think what this demonstrates is not just the corporations', but the American big heart. And maybe this sounds a little bit too mathematical, but I would love to see people get tax deductions. If they're shareholders in these companies that give, they should get a prorated way to deduct their charitable giving from taxes.
Quentin Hardy: I think at times like this, it is important to remember Matthew 6:2 from the Sermon on the Mount: when giving alms do not send a trumpet before you. Don't announce this or publicize this. It's something that's just good to do. Now, corporations should and do disclose what they give away, so the shareholders can decide whether or not they want to be owners in that kind of a company. Personally, I think that's a good thing. But the world jumps in at times like this, it's a reminder of our common humanity as with the tsunami, and that's a good thing.
Victoria Barret: What I've been amazed by is that many of the gifts so far from corporate America have been in cash. They haven't been, you know, these companies' products. If you think about this from a branding point of view, it would be much better to give your products and hope that you're targeting a customer base in Haiti, but they're giving cash because that's what the country needs right now, and it doesn't necessarily get them the kind of branding PR points that they would otherwise get. So they are doing this from the heart, and that's the right thing to do.
Neil Weinberg: I think at a crisis time like this, if you have a company like that or you have Home Depot who can provide building materials, it's totally appropriate for them to give where others can't. But in general I don't think that corporations should be giving. Let individuals give. They are the owners of the company and they should give the wealth. If you're talking about, for example, the financial institutions beat on by Washington lately, if they give and they do so in a public way, are they doing that for humanitarian reasons or are they doing that to further entrench management?
Mike Ozanian: I think the companies have to do it, David, because they have the resources, the wherewithal. They can manage the logistics much better and much faster than individuals can. And obviously, in this type of a disaster, we need to get aid there as fast as possible and as efficiently as possible. And as Steve mentioned, corporations here can do it much better. Even when we had the levees break in New Orleans the corporations came to the aid the fastest and best way.
In Focus: What D.C. Could Learn from Massachusetts When It Comes to Health Case Reform
Asman: Are we just three days away from deciding the fate of health care? This Tuesday's election for former Ted Kennedy's Senate seat in Massachusetts is turning into a proxy for more government health care in America. Republican Scott Brown is against it, and he's ahead in one late poll. Democrat Martha Coakley is for it. Remember, this is the nation's most pro-Democratic state that already has its own form of health care reform. And Rich says, voters there are telling DC it doesn't work. Rich?
Karlgaard: Well, it's a disaster. It's a fiscal train wreck. Dr. David Grasser with the Manhattan Institute is a Canadian physician, who has looked at the debacle in Canada, has concluded that since 2006 when this passed insurance premiums have gone up on the double digit basis every year, and the whole system is 85 percent over budget; so it's unsustainable. The Massachusetts voters know it and that's why Brown could pull off the upset on Tuesday.
Hardy: Well, I don't know. Coakley had a 30-point lead a month ago, and she lost it and fell apart after health care already passed because Brown, quite rightly, started making this the people's seat choice. He said it's not the Kennedy seat, it's the people's seat. He's not running on health care. Did you see this guy on Cavuto on Wednesday? He said he likes the Massachusetts health care, it's covering all but 2 percent of the population. He's not going to go to Washington and change things. You know who I wish was running? Dennis Kucinich. He said let every state try something different, let them experiment. We'll see what's working. Why don't we try that?
Forbes: He's made it very clear he's against what is being done in Washington and says we should go back to the drawing board, and that's what this is a referendum on. Rich is right; the numbers in Massachusetts have not worked.
Mike Maiello: You know who really likes Massachusetts' health care and the national plan? The insurance industry. They're the ones throwing fundraisers for Martha Coakley. Steve likes to call them useful idiots on this front. I think you've got to take them at their word. They think we're going to make a lot of money with reform.
Barret: Look, I think this is larger than the health care debate. I think a lot of Americans are fed up with the change they thought was coming to Washington; instead we've had a lot more of the same. We don't have transparency and lobbyists are running the show. I think that's what this is about, and you're also seeing this in Oregon--another very liberal state that is not likely to pass an income tax hike…I think this is a turning point. People are saying, "Hey, we need a different plan, we need changes and this is different than the change we thought we were getting."
Flipside: States Look to Desperate Measures to Raise Money: Good News for Taxpayers!
Asman: More states turning to desperate measures to raise cash. New York is now considering legalizing and taxing ultimate fighting. And cash-strapped California is close to letting all adults grow and smoke marijuana to bring in more revenue. Mike, you say this is great news for taxpayers?
Ozanian: It's great news for everybody. I think it should be up to people in terms of whether they want to see ultimate fighting and smoke pot and shouldn't be the choice of the government to tell them what to do. Let's face it, if it's a legal business, it's going to be taxed.
Hardy: When you think about outcomes you also have to think about intentions. Smoking dope or watching men beat each other to paste sounds like a terrific libertarian outcome. But the fact of the matter is the government is doing this for the tax revenues. What does that mean? They don't want to actually step up to their deficit. They don't want to change their behavior. So, next, maybe we make it okay to sell one of your kidneys if it can be taxed, or sell a baby if it can be taxed, or who knows what. That's not libertarian or small government. That's new sources of tax revenue which don't change the fundamental things government has to do. Cut entitlement. Cut pensions to government employees. Cut gross military spending. Cut Medicare. You know, all of that stuff.
Evelyn Rusli: I think this is okay. These governments are not operating under the assumption that this is the only thing they're going to do and it would be great if we could, obviously, ban all of these things, and that would be fine, and people would follow the law. But honestly that's not going to happen. We are going to have to make some money off these markets and why not? If these governments are cash-strapped like in California, like in Washington, why not think creatively and look at the new markets? If the public is ready for it, and if they think they can regulate responsibly, why not?
Forbes: If they get this money they'll spend it and then spend some more, and the next thing we'll have is bigamy. Imagine the license fees you can collect from multiple marriages at the same time. How about bringing back gladiator games from Rome? How about legalized murder? Don't like your spouse?
Asman: I don't think Jim [Michaels] would go that far.
(LAUGHTER)
Weinberg: The system that we have tells us some things are good: you get a tax break for a big house, but you don't get one for a second house. Within this bizarre system we have, this is probably a good idea. Let people do what they want. But it would be better to get rid of the system and put in a flat tax, and I'm sure Steve would agree with me, and start all over.
Informer: Golden Globe Stocks
Asman: Money-maker "Avatar" up for multiple Golden Globes this weekend. But our Informers say if you wanna make money, check out their award winning stocks:
Weinberg: Netflix (NFLX)
Barret: Apple (APPL)
Ozanian: Viacom (VIA)
Rusli: Teva Pharma (TEVA)
Bulls & Bears | Cavuto on Business | Forbes on Fox | Cashin' In
Lawmakers Say We Need New Jobs Bill: Based on Fact or Fantasy?
John Layfield, Nutritionmarket.com: Look, these guys are trying to put lipstick on a pig and it's not working. Look at their own numbers, the Bureau of Labor Statistics that the government uses, right now, real unemployment. Those who quit working, quit trying or dropped off unemployment rate is at 17.4 by the Bureau of Labor Statistics. It started the year at 13.5 percent. That extra 3.9 percent from the beginning of the year from now, despite $2 trillion being spent through stimulus and bailout plans created 6 million people less are working at the end of '09 than were working at the beginning of '09. These numbers are absolutely bogus that they're saying.
Julian Epstein, Democratic strategist: Well, those are difficult calculations for sure, but I think John is right. We should look at the numbers here, and the proof is in the pudding. When Obama inherited the presidency, we were losing 750,000 jobs a month. We are now close to losing zero jobs a month, so we've actually improved. The trends, as a result of the Obama recovery plan, are quite, quite good. And in the same way we were at negative 6 percent growth, we're now a positive 3 percent growth, so if you want to look at whether the government strategically and temporarily can have a positive impact both on jobs and economic growth, just look at the last year. The results have been remarkable.
Tracy Byrnes, Fox Business Network: Whether or not that's true or not, the trend is that we are losing less and less jobs. We haven't even spent the stimulus money out there. Why are we spending more and adding $65 billion to our deficit over the next 10 years when there's still money that's appropriated out there that hasn't even been touched.
Jonathan Hoenig, Capitalistpig Asset Management: That's a fallacy, that's a fallacy that spending equals wealth. Week after week, this president's contempt for free enterprise amazes me. I mean, he doesn't trust that the free economy is productive. That the free economy can actually create jobs. So to get this fuzzy math as you described and the modern day equivalent of government hiring people to dig ditches and fill them in again. Just to create jobs, but it doesn't create any.
Jonas Max Ferris, Maxfunds.com: If you actually did hire people to dig ditches, you could add it up. They've been avoiding that kind of new deal, FDR-type of program. We've gotten a lot of tax cuts, spending, Cash for Clunkers, nobody knows how many jobs were saved. Like tea leaves and everyone can read into it what they want and point to whatever figure. It's fair to say when the government creates jobs in recession; it's an expensive way to create jobs. There were tax cuts, they probably helped the economy, and they probably created jobs at a very high cost. Cash for clunkers created jobs in the auto industry at a high cost and the key is to transition out later. Do you want more jobs and unemployment down to 6 percent, unnaturally so, if you want it to happen soon the government has got to buy expensive jobs through these programs.
Wayne Rogers, Wayne Rogers & Company: I don't know how you calculate. You have an exercise where you try to figure out whether the jobs are safe. They just said it's silly, and they're absolutely right. If you take a dollar and try to trace it through the system, where did it go? Half of it's lost in administration, and it doesn't get it to where it's going. This is all stupid and the only one that counts is ultimately what percentage of the work force is working versus what isn't working, and you're debating something that couldn't be debated with all due respect. I think that Julian is right in many ways; you don't know which, you don't know if you said, "Hey, we'll spend 50 billion dollars, we don't what part of it's doing good, but we know some of it's doing some good," and that's about all you can say.
Save Lives and Money by Funding Building Codes in Poor Nations Like Haiti
Byrnes: We're going to help them no matter what. We're not going to let these people be without and so we're going to try and give money every time something like this happens. Why not be preemptive? Why not take steps to help them with better building codes and proactive and maybe save us money in the end?
Ferris: Well, first of all, it actually costs more for these California earthquakes in dollars than all the support that Haiti's going to cost. So in life cost it's another story. I would argue against it because this isn't L.A. I mean, we're talking about a country where people don't have building codes at all in general. To have codes like we have the government has to regulate... that's a rich nation thing. They need indoor plumbing, they need phone service, they're not at the level where we are where they can spend that kind of money to prevent a once-in-a-century event. That's not a good cost effective use of resources. What we're doing now is the way you deal with it. It's a rare event, it's a tragedy, but you don't spend billions of dollars building buildings up to the snuff of earthquakes that rarely happen.
Rogers: You cannot-- this would be a waste of time for us to try and force and building code in a country that's as third world, if you will, as Haiti is. They had-- you've got to remember, Duvalier and the coup and a totalitarian government. A perfect example of a country that has no middle class has no infrastructure and as a consequence, you can't do anything about it. When you have a government like that these things are going to happen and you're going to deal with them as they are. It's an entire waste of time and money all the time. They are going to steal all the money, whoever is governing.
Hoenig: I disagree with the premise that government regulation builds safer buildings at all. I mean, here in the relatively capitalist United States it's in the self-interest of property owners of course to make their buildings as safe as possible. Whether it's commercial, 'cause they have tenants, or residential 'cause they live there, but I have to say, I agree with Jonas, I mean, this is the poorest country, people that live on $2 a day. Do you think if we show up with some buildings codes, things are going to turn around there? Wayne is also right--they need a change in government there. They need a stable functioning economy. They need to create wealth not building codes.
Layfield: We've got to do something, but building codes is not the answer. It does work in Key West and Bermuda. Those are places have more disposable income. These people just want to eat. Bill Clinton is the perfect envoy from the U.N. to go down there. He gets remarkable things done overseas, but this is one of the poorest countries in the world, and to try to put building codes on them just won't work. Understand America is one of the most generous people in the world. We gave $6.47 billion in private donations to Katrina victims. We gave almost $2 billion to tsunami victims in Asia. We're going to give probably more than we gave to Katrina, and I think that Americans should be allowed to give...let the government take those private donations instead of tapping the federal government to do this. Americans are overwhelmingly going to support our neighbors down there. There's 700 miles from the United States. We have a long history and these people need it. But I also think that Americans would support helping these people rebuild their nation properly. I mean, just giving them money and giving it to the government down there and letting them make decision is not going to get us anywhere, quite frankly, they're just going to come back and ask for more money. We need to be practical about this. A country built on tissue paper. You can't rebuild it that way or it will be tumbling down, and we'll be sending more money.
New Tax Plan on Investment Income to Pay for Government Health Care Plan; Could It Cause Double-Dip Recession?
Hoenig: Well, when you come right down to it, the essence of this health care reform is taxing productive investment productivity for redistribution in a public entitlement program, so they're going off high income earners, tanners, folks, you know, saving for retirement wherever they can literally find the money. That's the problem. When you make health care a right, you obligate everyone to pay for it. There is no more private property. Put your political platitudes aside you've been taxing a productive investment for redistribution and basically a Ponzi scheme, never ends well.
Epstein: I don't want Jonathan to fall off his seat, but I half agree with that. I think that it's actually a mistake to tax investment income, but you have to define what you mean when you're talking about that. If you mean the investment income that you and I make and we get capital gains on if we have a gain, I think that's a mistake. If on the other hand, you're talking about going after the careless interest for the private equity firms who basically structure their income as capital gains, then it goes to Warren Buffet's comments that the CEO's who are making, you know, tens of millions of dollars a year shouldn't be paying fewer taxes than the rates their secretaries are.
Ferris: First of all, they have to do something because they're not taking money from the union's Cadillac plans, and it's going to mean more taxes to other people, probably to Jonathan's point to wealthier people. I'm not for that long haul and for a double dip recession, the question at hand here, no, I'll tell you why. When the government taxes money and spends it, that is stimulative, unless they tax money and pay off the debt, which is not stimulative. Although good long haul, you're going to prevent a double dip recession because money is being spent. I'm not saying it's a good long-term policy, but you're not going to get the recession when the government taxes wealth and then spends it somewhere else.
Byrnes: When have you seen the government officially take your money and spend it properly? Where does it go? I don't know where the money goes that they take from us when they tax it, it goes nowhere so they'll tax us more and more and it's not just taxes, 5.4 percent surcharge, you're going to see increased federal and state taxes because our states are drowning so those taxes are going up, everything is going up. How is that money spent?
Rogers: You're creating another entitlement program. None of the system is going to work, basically flawed in all cases because you've got a third party paying to two people. It's never work, it's not going to work, no history of it. Not going to work, sorry.
Layfield: We are robbing Peter to pay Paul. We were taxing the banks to pay for the General Motors bailout and using FDIC assessment on small banks all around the country and banks and executives are getting million dollar bills to pay for the big bank bailout. That's hurting small business in small town America and they won't lend doing that. I think the taxes are a bad idea.
What Do I Need to Know?
Layfield: Playoff football, I love it. Cowboys look great heading up to Minnesota; Kurt Warner plays football in January like nobody else. Bet on him against the Saints this weekend. Las Vegas Sands (LVS) is a great stock that has a betting theme Jonathan Hoenig: I'm not a bear, check out shares of the (VXX), this tracks the fear index. If you are worried about a correction but don't want to bail out. It could be a good thing.
Byrnes: Retail sales are bad in December, and they are going to stay that way. Taxes, uncertainty, health care reform. No one is going to shop until they know what is going on. Blame the government for this. Until we get a clearer picture, expect a slow rebound this year at best.
Ferris: We and finding out the Chinese government was snooping and spying with Google in China. Avoid Chinese stocks. The speculator may consider shorting Chinese stocks, even a very small stake in a risky leveraged inverse ETF like: UltraShort FTSE/Xinhua China25 Proshares (FXP)
Rogers: The current Financial Crises Inquiry Commission has called the wrong people to testify and will not have the slightest understanding of what happened which is that the Congress cancelled the Glass-Steagall Act calling it "outmoded" and a "Depression-era" cure. They will opt for more regulation of BIG Banks instead of breaking them up and separating the taking of deposits and making loans from the investment banking functions of underwriting securities, trading stocks and bonds and creating swaps and derivatives.
Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox