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MILLIONAIRE EDUCATORS: PROOF THERE IS HYPOCRISY ON WHO IS "GOOD RICH" OR "BAD RICH"?
JONATHAN HOENIG: It mystifies me Cheryl. I mean, our culture demonizes businessmen at every opportunity. You know, they're exploitive, they get rich on the backs of the poor; they're nefarious whereas educators are these tireless, public servants that are somehow sacrosanct from any criticism. In fact, they're deserving of what? A blank check from taxpayers. I don't begrudge anyone's money provided that it's earned through voluntary trade, but you can't compare an educator millionaire with a businessman millionaire, because the educator millionaire, because of the monopoly on education, gets rich through government force.
JOHN LAYFIELD: Yes it's unfair. Look, we love to demonize guys like Jonathan who are hedge fund managers because no one can defend a hedge fund manager and say, oh they're just wealthy. They don't create anything; they're just rich for being rich's sake. This has gone on in this country since the beginning of this country. You had Hamilton and Jackson, you had the Pecora commission with FDR; you had the speculators being blamed during the 1970s. Anytime you have politicians that want to get reelected, they have a populous message and they go after people who have a lower approval rating than them; that is bankers; that is speculators, and now it is Wall Street guys and hedge fund managers. This is nothing new. It's age-old politics of, find somebody who has a lower approval rating than me and go after them.
MALIA LAZU: Not only is this a little "let them eat cake-y" and a little Marie Antoinette-ish, but I think what is also happening and what we're seeing here is that there is a very broad definition of "educator." I looked it up and it includes college administrators and some of the highest paid educators are basketball coaches. So you can go and you can look that up. We're not talking about the teachers who work in Cincinnati, Ohio who make $46,000 a year and secondly, the irresponsibility that you guys are putting forward also has to do with the fact that, at the end of the day, people are mad and they are angry and they are outraged at folks that ruined the economy and were very irresponsible with our money, and that happens to be bankers right now. So it's not that, oh the poor bankers are being vilified and that the left hates them. We hate people and we are angry at people who don't like to be responsible for this entire country and that is what is going on.
LORI ROTHMAN: This is the key reason why this is so outrageous and so hypocritical. The educators in this survey, whether they're basketball coaches or everyday teachers, made their money by taking risk just like CEO's, just like bankers. The educators said they were very responsible with their money and made smart investment decisions, which included a significant amount of risk.
WAYNE ROGERS: Well the whole thing is misdirected. If you want to lay the recession at the base of the bankers, why not lay it at the base of Congress? That's who caused it. There are 57 members of the Congress who are in the top one percent of earners. Congress has 250 millionaires. These are the people who are stealing the money. It's not the bankers. They made it possible for the bankers to steal it. It's the Congress who are the people who are the cause of this thing. Why don't you blame them?
DONALD TRUMP'S APPETITE FOR REAL ESTATE RETURNS: A GOOD INDICATOR HOUSING IS STARTING TO MAKE A COMEBACK?
LORI ROTHMAN: Since I'm in the market for a casino myself...no, but even for average homeowners I think that people are starting to realize that home prices are soft. Interest rates; we got a scare a couple of weeks ago. They popped up. They've come back down, but we know that these historically low rates are not going to stay this low forever. The economy is showing signs of life. I think the worst is behind us and I think we're starting to clear out some of this inventory now. I think signs look good. We're bumping along the bottom for sure, but I definitely think, especially in certain regions of this country, we're starting to see the bright light.
WAYNE ROGERS: Lori is right. The key word is certain regions. All housing is local. It's not national. I mean, the national's just a compilation of that. For example, in South Florida, where there's probably a thousand plus condominiums still on the market, they have started to rebuild. Why? Because that particular area of the country is susceptible to foreign investment. They have Europeans and South Americans coming in there because that looks like a safe haven. There are other areas of the country that are not doing so well and by the way, I wouldn't use Donald Trump as a barometer. He didn't do so well in Atlantic City and he didn't do so well in Chicago. I'm not saying he's the maven of real estate by a long shot, but there are areas, for example, Arizona is still suffering; Las Vegas is still suffering; there are places like that that are still suffering. There are other places that are doing very well. Yes, the bottom answer is in general, real estate is coming back. It is a great investment.
MALIA LAZU: We're seeing up in Boston housing prices are actually on the rise. So, you know now is probably one of the last good times to buy with the low interest rates as well.
JONATHAN HOENIG: Well you know Cheryl, market opinions are like smiles. Everyone's got one. Donald's got one. I'm actually with Wayne. I don't consider Donald Trump to be a terribly credible businessman, or capitalist. That's a whole other discussion. What's been interesting about real estate is the strongest areas of real estate right now is commercial real estate. Names like; Boston Properties; BSX, Kimco (KIM); Simon Property Group (SPG); all the areas within real estate that the government hasn't incentivized, hasn't helped out. Again, commercial is doing a lot better than residential right now and I expect you'll see that trend continue.
JOHN LAYFIELD: It is a good thing if they're starting to get into housing for the right reasons. Look, you don't buy a home for an investment. You buy a home for something you're going to live in for many, many years and with interest rates as low as they are, it is a good time to buy. Look, I said a couple of years ago we were going to suffer another leg down. I think the worst part is over like Lori says, but I do think we have a problem coming forward because of so many foreclosures, because of so much inventory. What Wayne is saying is correct. There are pockets of the country doing fantastic. You look at the middle states; the agricultural states. They are doing fantastic right now. If you look at the "sand states" they are suffering dramatically. So, part of the country is doing well, part of the country is not, and on average it looks like we're getting out of an economic downturn. I think we have another leg, not necessarily down, but we're at least treading water for the next couple of years.
$4.9 BILLION FOR THE "BULLET TRAIN: GOOD OR BAD USE OF TAXPAYER MONEY?
JOHN LAYFIELD: This is just stupid. We're trying to build fast trains so we can keep up with China. Look, you've already got fast service between Las Vegas and Los Angeles. It's called Southwest airlines. You can fly for 69 dollars. You don't have to drive 100 miles to catch a train to go somewhere and then catch a taxi to go to your hotel. This is ridiculous. You want to open up infrastructure? Build DC transmission lines from solar farms from the Mohave Desert to Los Angeles or from Southwest Arizona to Las Vegas. That opens up commerce. This is a government boondoggle and it is a waste of money.
LORI ROTHMAN: Huge waste of money. I mean, I couldn't agree with John more. Part of the fun, I grew up in Los Angeles, is driving, stopping at the In & Out Burger and Barstow. It's all part of the culture there, right? I'll tell you the other thing. This price tag; there's no way they're going to come in on budget. If we learned anything from Solyndra, interest payments, you name it, it's a disaster.
MALIA LAZU: I think at actually should be expanded. I don't think that. I mean, I agree, you shouldn't have to drive 100 miles to get on a train. It would be great if we had a way to take trains across this country in an effective manner the way most first world countries do.
JONATHAN HOENIG: I'm sorry. We have a way to take trains across this country, Cheryl. It's called Amtrak. It's a government monopoly and you know what? It's lost money every year for 41 years.
WAYNE ROGERS: Well, there is a way to make this feasible. Seriously, it's been talked about for 50 or 60 years at least. You can make this train if you get everybody in Las Vegas, that is, all the gambling interest in Las Vegas including the hotels, to finance it. Let them finance it. They'll be the beneficiaries. Let them put up the money, underwrite the bond issue and go ahead and build the train. Then you don't have the government involved.
WHAT DO I NEED TO KNOW?
JOHN LAYFIELD: (NFLX) Netflix making a comeback like Ron Burgundy and "Anchorman"
LORI ROTHMAN: Next week's jobs report will set the tone for stocks and the economy
WAYNE ROGERS: Take a gamble on gaming supplier, Shuffle Master Inc. (SHFL)
JONATHAN HOENIG: Make big bucks from Japan's small cap stocks, buy (SCJ)