Bob Sellers sat in for Neil Cavuto and was joined by Jim Rogers, president of JimRogers.com; Charles Payne, CEO of Wall Street Strategies; Mike Norman, publisher of the Economic Contrarian Update; and Molly de Ramel, FOX News Business correspondent.
Stock Spoiler?
As speculation continues about if and when we may attack Iraq, oil prices crept over the $30 mark last week. The last two times that happened stocks tanked and the economy slipped. Should investors be nervous?
Jim says stocks will probably be down in 2002 since they are down so much so far this year. An attack on Iraq would probably keep oil prices high since a war would probably not be quick and easy this time around. If oil prices continue going higher, he recommends buying Royal Dutch (RD), which he owns.
Mike says an U.S.-Iraq conflict would trigger a negative reaction in stocks, the financial markets and the economy. He also thinks Saudi Arabia is a bigger problem than Iraq do to the influence of extreme fundamentalists in that country. He thinks Petroleo Brasileiro (PBR) would benefit from higher oil prices. He owns the stock.
Charles thinks even though there is a war premium in the current price of oil, a real war would send crude higher. But because of U.S. reserves and a source like Russia, he thinks the long-term impact could be mitigated long enough for the U.S. to secure a victory. He recommends buying Patterson-UTI Energy (PTEN) if prices rise. He does not own the stock.
Disaster Stocks
Investors threw the following disastrous stocks out the window as bad news exploded around them. Martha Stewart (MSO), AOL Time Warner (AOL), and Tyco International (TYC) are all still way down for the year but way off their lows. Will they keep heading north as they get further away from bad news and scandal?
Charles says Martha Stewart may be the best bet of the three, but it is a speculative investment. He thinks Computer Associates (CA) is a "disastrous" stock that will bounce back.
Mike says stay away from MSO and TYC. He thinks AOL may be a good buy if the company spins off its online and cable units. He likes and owns AT&T (T), which he says has enough assets and cash to allow it to weather the telecom shakeout.
Jim thinks disasters stocks are a good place to find value. But he says don't buy tainted disasters like MSO, AOL and TYC. Instead buy an untainted "disaster" stock likes Matsushita Electric (MC). He owns it.
Head-to-Head
Why is there a limit to how much tax deferred money you can put into your retirement account? Bob says there should not be any kind of cap on contributions to 401(k) plans and IRAs. Kathy Boyle, President of Chapin Hill Advisors says that idea is dangerous to investors and to our government's tax base.
FOX on the Spot
Molly says Martha Stewart will receive a subpoena and will testify before Congress.
Mike predicts stocks will slip as the dollar dips & interest rates rise.
Charles thinks stocks will sell off on more news that the economy is slowing down.
Jim says the Earth Summit in Johannesburg, South Africa is a waste of time.
Bob says we will not attack Iraq before the end of the year.
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