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CONGRESS PASSES SPENDING HIKE AS NATION'S DEBT TOPS $16T
GARY KALTBAUM: I don't blame the freshmen-I blame the leadership. It comes from the top down. There are just no grapefruits in Washington DC. I go back to one simple number. In 08, they spent 2.8 trillion federal spending, it's going to be 3.7 trillion next year, and there's base line budgeting where it always goes up. Just remember, Paul Ryan is no freshman and he came out with a budget plan which lowered the rate of spending.
DAGEN McDOWELL: It's just for six months, but what a photo op that was with Paul Ryan showing up and he's there voting in favor of it. And the vote was 329 to 91-so that was shocking.
CHARLIE GASPARINO: Is I worth it politically? I mean, I think that's the calculus here. We're going to have a huge fight over $8 million. Here's the thing, we have bigger fish to fry-Medicare and Medicaid. By the way, I would just say this: you have an economy where the numbers don't look good right now. Unemployment looks pretty bad. And I know that the overall number went down but that's because people are dropping out of the work force. I don't think now is a good time to dissimulate.
ADAM LASHINSKY: Well it's mildly encouraging that they're not choosing to stand on principle on something that's not worth standing on principle. To their credit, they are committed to having a fight about this after the election-and well, they should. That's what they were elected for. There's a political process going on and they're acknowledging that they get it.
ANTI-AMERICAN RIOTS IN MIDEAST SPARK CALLS TO CUT U.S. AID
GARY KALTBAUM: It comes down the three words: Enough is enough. We should get some sort of return on our investment because hundreds and millions of dollars are going that way. By the way, a lot of that money-we don't even know where it went. A lot of it has been lost and has been picked up by who knows what. It really has to stop. We need to take it all back at this point and make them earn our dollars that by the way, we don't have right now.
DAGEN McDOWELL: It's a tough situation because the vast majority of the aid that we give to Egypt in recent years. We've given them more than a million and a half billion dollars every year and it's been the second biggest recipient of aid from the U.S. since 1979 behind Israel being n umber one. The vast majority of that aid goes to the military so it's tough to say if we weren't giving Egypt that aid in recent years or over that history. Would the situation in that county be worse? But certainly, it should be a big negotiating chip in dealing with this country now.
CHARLIE GASPARINO: Well we should point out that the Egyptians military's is probably the most moderate and most sane part of the government over there right now. But my heart is pulling the money back from them because listen; you give the money so you have influence over their affairs or you have some say or some stroke inside that government. Obviously, we don't.
ADAM LASHINSKY: I don't think it's obvious. Dagen made a good point that you can't be certain that we haven't gotten a return on our investment. There has been relative stability in the Middle East over the many years of this foreign aid. I'm not saying there has been stability and I'm not saying it's pretty.
WALL STREET RALLIES ON NEW ROUND OF FED STIMULUS
DAGEN McDOWELL: To paraphrase the Wall Street Journal, this was a big fat campaign contribution to Mr. Barack Obama by Ben Bernanke. Boy did he try to separate himself form the politics of this. Talked about it in the press conference this past week saying it's only about the economy. But you look at how the market reacted the day of this announcement. The Federal Reserve could have waited. As well telegraphed as this has been, they could've just changed the date the interest rate stayed zero and had not done anything else and wait until after the November elections. But he decided not to. And Hallelujah! The White House is celebrating.
CHARLIE GASPARINO: I would just say this to Dagen and to people who think this is political. Have you seen the recent statistics? Have you seen the labor market shrink? Have you seen the census data that says middle class incomes are at the same levels as 1995? The economy is getting conceivably worse.
ADAM LASHINSKY: The market going up isn't going to help President Obama with unemployed workers in Ohio who don't have a lot of investments in the stock market. It may help the economy, I agree with Charlie.
GARY KALTBAUM: Ben Bernanke has now become the biggest bundler in the history of time. There's only 52 days till election, we're not in a depression, GDP numbers are not in a recession and housings not an anchor anymore. This has to do with Mitt Romney coming out and saying we're going to can these guys rear-end if he became president. There's no reason for him to do this.
STOCKS HEADING EVEN HIGHER
SPDR GOLD SHARES (FLD)
GARY KALTBAUM: I absolutely love gold and I own it. Buy the proxy GLD. I absolutely believe its going doubled of the next couple of years.
ADAM LASHINSKY: Well the FED move obviously makes this a good pick for Gary right now. I have no idea if it's going to double; I just think speculating in currencies is exactly that.
ADAM LASHINSKY: Lennar is a home builder. It has already done extremely well and pays a nice dividend. One of the reasons its done well is that it had already gotten so bad. And essentially it doesn't really have anywhere to go but up because of housing almost has to improve because it's so bad
GARY KALTBAUM: I love the stock and I own the stock. The only thing I would tell you is that it has had a good move recently in short order and I would like to see a few percent pulled back before entering again.