Neil Cavuto was joined by Gregg Hymowitz, founder of Entrust Capital; Jim Rogers, president of JimRogers.com; David Nelson, president of DC Nelson Asset Management; and Molly de Ramel, FOX News Business Correspondent.
Iraq Rally II?
The Dow's been on a winning streak, up seven weeks in a row, just as things begin to really heat up with Iraq. Will the rally keep going if Saddam defies the United Nations and America is forced to go to war?
Jim says no, the market is rising because it prefers peace and the consensus is that a war with Iraq has been put off for now, if not forever. Jim says the markets are benefiting from the Federal Reserve printing money and huge government spending.
Gregg agrees that the market does not believe a war is imminent. He thinks if there was a war and it was quick, the market would rally.
David says investors are still keeping cash on the sidelines in anticipation of a war. He thinks a war would cause a short rally, but stock will not repeat the 1991 post-Gulf War rally.
Neil also asked his guests, if we attack Iraq and the market rallies like 1991 what do you buy?
Jim says if we attack Iraq and it’s a quick war, he would recommend the Turkish Fund (TKF). He owns it.
Gregg says if it’s a quick war, the economy and market will get back to normal and that’s why he would recommend big tech stocks Microsoft (MSFT). He does not own it. David says beaten down brokerage stocks would benefit from a post-war rally. He recommends and owns Merrill Lynch (MER).
Get Usama Now!
Last Monday stocks sold off after our government confirmed the voice on that audio tape was Usama bin Laden’s, leaving no doubt that he has survived. Do we need to kill or capture Usama in order for the market and economy to rally for good?
David says as long as Usama is alive there will be a cloud over this market. Investors will always be on the lookout for the next attack. Eventually it will come. He is amazed how throughout history governments and the military have the capacity to inflict massive damage yet can not find the means to eliminate one individual.
Gregg says the Bush administration needs to have this as priority No. 1. He thinks the market would rally on confirmation of bin Laden’s capture or death.
Jim says the news on Usama is not why the market fell; it fell because it had had a dramatic rally over the previous 6 weeks. It would rally a day or so if he were dead, but he has many replacements so our worries will continue until we change our ludicrous policies which make more enemies in the world, not fewer.
Molly says we had a knee-jerk reaction when we all find out Usama bin Laden was alive, but the market is still up and since then remains up.
Head-to-Head
It is tougher for Muslims to enter the United States than before Sept. 11. And that’s fine with Neil. He says America is about to spend nearly $40 billion on a Homeland Security agency, because Muslim extremists attacked America. And that no one is saying all Muslims hate America, but the people coming from those countries should get a closer look.
Hussein Ibish, communications director of the American-Arab Anti-Discrimination Committee, says this damages our core American values of equality and fairness and there is no real reason to think it will make us any safer.
FOX on the Spot
Jim says to sell GE! More accounting and debt problems will be uncovered!
Gregg predicts U.S. stocks and the dollar rally as the Europe fixes its weak economy!
David says Tony Soprano of the HBO series The Sopranos whacks his broker for bad advice. Ratings soar!
Molly thinks media stocks are back in the limelight and lead market higher!
Neil predicts the rally on Wall Street continues and blue chips end the year higher, breaking the Dow’s two-year losing streak!
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