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.
This past week's Bulls & Bears: Gary B. Smith, Exemplar Capital managing partner; Tobin Smith, Changewave Research; Pat Dorsey, Morningstar.com director of stock research; Bob Olstein, The Olstein Funds; Eric Bolling, Independent Trader.
Trading Pit: Is the Worst Over for the Economy and Market?
Gary B. Smith: I think the worst is over, and here is why: Despite all the bad news (i.e.: retail sales numbers on Thursday), the Fed is always there (right now) to bail us out.
Add that to these facts: inflation isn't killing us (CPI report on Friday); the Fed is not only bailing out financials (via taking mortgage backed bonds) but will definitely reduce rates AGAIN next week; it is probable most financial institutions have written down most of their losses and profits will be big the next few quarters; unemployment is still near all-time lows; despite the hue and cry, median home prices have only pulled back to their long-term up-trend line.
Tobin Smith: NO the worst is NOT OVER, and will not be over until banks fess up to NEW write-downs for first quarter carnage…and blown up hedge funds liquidate-and mortgage default rates STOP CLIMBING. The economy continues to slowly contract as job losses throughout this summer.
We will be in official recession by August; the first two quarters will be flat-to-negative, and job losses will force the entity that declares such things to declare recession. The most important thing is that the market will bottom before the official determination! It always does!
Eric Bolling: Because of the stimulus, we will narrowly avoid a full-blown recession. The fiscal and monetary put in play will begin to make a difference soon. Also add in a touch of confidence…courtesy of S&P guidance and CPI, we will just make it out.
Bob Olstein: The economy is in a slight slowdown or recession and stays there until 2009. However... the stock market is a discounting mechanism. The market right now is 15 percent-20 percent undervalued on expected 2009 earnings. There are bargains all over the place.
I do see commodity inflation (energy prices) starting to tick down slightly. And I see corporate and investor liquidity at record levels, so there is cash out there waiting to get in.
Pat Dorsey: Whether or not we're technically in a recession is splitting hairs. The economy stinks, the housing mess is awful, and the market reflects that. The thing everyone is missing is the "market reflects that" part. For the patient investor, now is the time to be buying, not selling. I have no idea if the worst is over, but what I do know is that there are a ton of high-quality stocks whose prices already discount a lot of ugliness. Unless we have a Japan-like "lost decade" experience (a highly unlikely scenario, since we're actually taking the pain rather than avoiding it, as they did) forward-looking market returns should be solid from here.
Eliot Spitzer: Did Wall Street Lose a Friend or Foe?
Eric Bolling: Wall Street is losing a friend. He is friend of all of the honest hard working people who not only work on Wall Street, but everyone who has ever put a buck in the stock or bond market. He might be a foe to the big wigs, but not the majority of people!
Tobin Smith: Wall Street lost a total foe! His scorched earth approach to law enforcement turned innocents into criminals. It is great for Wall Street to have him out of our hair.
Bob Olstein: Wall Street lost neither a friend nor foe. He did clear up a mess, but unnecessarily stepped over the line for political purposes and hurt shareholders and companies not afflicted with any of the transgressions he sought to solve.
Gary B. Smith: Wall Street lost a foe. He brought few convictions, and was more bully than savior. Firms caved to him without the due process of law.
Stock X-Change: St. Patrick's Day Stock Party
Gary B: Ryanair (RYAAY)
Tobin: Diageo (DEO)
Bob: American Express (AXP)
Eric: AMBEV (ABV)
Pat: Sysco (SYY)
Tobin Smith's prediction: "Kristen" hits push Google (GOOG) up 25 percent by July!
Gary B. Smith's prediction: S&P 500 at a bottom, up 20 percent by Oct; Buy "RSU"
Pat Dorsey's prediction: Visa IPO set to soar; could be a $70 stock!
Eric Bolling's prediction: Gold to $1,250 by New Years' Eve! Play it with "GLD"
Bob Olstein's prediction: Americans will ALWAYS go shopping! Macy's (M) up 30 percent in 6-12 months!
On Saturday, March 15, 2008, Neil Cavuto was joined by Ben Stein, “Yes, You Can Supercharge Your Portfolio” author; Charles Payne, wstreet.com; Tracy Byrnes, FOX Business Network; Adam Lashinsky, Fortune Magazine; and David Nelson, DC Nelson Asset Mgmt.
Bottom Line: Clinton and Obama Approve Budget — Proof Tax Hikes Coming to Middle Class if They Get Elected?
Neil Cavuto: Forget only hiking taxes on the super rich. Late this week, Senate Democrats including Hillary Clinton and Barack Obama voted for a budget proposal that includes virtually destroying President Bush's tax cuts… and effectively raising taxes on anyone making more than $31,850.
Did we just get proof that a President Hillary Clinton or President Barack Obama would hike taxes on anyone earning more than $31,000?
Charles Payne: I can't say that I'm surprised. I really hope that folks out there are paying attention. You know, a year and a half ago when the Democrats were talking about the rich… they were specific. One-million dollars made you rich. And then, through some of their proposals since then, we've seen the number steadily come down to $250,000, $100,000, $80,000 and now this. People have to be appalled. First of all, I think raising taxes is a terrible idea. But, to go after poor people… is abysmal. It's nuts!
Neil Cavuto: Dave, the argument is there are so many goodies and enhancements including getting rid of the AMT in the blueprint, that it more than off-sets this and the middle class comes out a winner.
David Nelson: That's probably not true. I think taxes will go up for everyone. As Republicans, we probably took deficit spending too far. We really dug our own grave. We had a perfect opportunity, but we didn't keep a lot of things in check.
Neil Cavuto: Like spending.
David Nelson: Like spending. What has to happen now is the pendulum has to swing too far to the left so we can get to some sort of center. I think that's what's going to happen right now.
Tracy Byrnes: Neil, removing the AMT and the whole theory that it's going to help the lower income is futile because those people aren't really in it to begin with. Now, you're taking a married couple making $63,700 and you're going to raise their taxes? That includes children and putting them through college and feeding them. They probably weren't in the AMT to begin with.
Neil Cavuto: Well, many in that group are, right?
Tracy Byrnes: Some, but not nearly as many as those who make $100,000 and live in higher-income areas. These lower income folks are going to get hit by this.
Neil Cavuto: Ok Ben. Let's move forward to the fall. Is it an issue?
Ben Stein: It should be an issue. They've been talking about this for some time. I've been in favor of trying to balance the budget. I think taxes are way too low on the rich like you. But, I do think that the idea of raising taxes in any way, shape, or form on anyone with incomes below $500,000 is just ridiculous. We can raise all the money we need on people making $1 million and up, and especially $5 million and up. I don't see any rationale or excuse to hit people at this level. It doesn't make sense.
Neil Cavuto: You know, Ben… I read your column on this in the New York Times last week. And I think, by the way, since you've been doing these columns for the New York Times, you're getting nutty…
Neil Cavuto: I love you, Ben.
Ben Stein: Well, you're very much in the minority for thinking that. I've been getting a lot of nice mail…
Neil Cavuto: But let me ask you. The argument for raising taxes on the wealthy… let's say you're right. They have to do it. Would you be doing it in an environment like this when at the very least we're looking at a slow down and potentially worse?
Ben Stein: No, absolutely not. It makes no sense on either a Keynesian basis or a classical Adam Smith basis. The slowdown will end. All slow downs end. There will be a recovery. I don't know when. But there will be a recovery. When it ends, we have to clean up the budget mess. I mean, we're facing budgets so enormous from Medicare and Social Security; we have to get our house in order. That will strengthen the dollar and strengthen America all together.
Adam Lashinsky: Well, first of all I just want to say is my goal in life is to get into Ben Stein's tax bracket.
Neil Cavuto: We all have that same goal.
Adam Lashinsky: We're having a very esoteric debate. What's an appropriate tax rate? If Charles were being honest, he'd say zero. But we can't go to zero. We need taxes to pay for programs. For the people making $31,000… the suggestion is to go from 25 percent to 28 percent. I don't know what the big difference, other than 3 points, is between 25 percent and 28 percent. We need some formula that balances the budget. The irony is that the Democrats are talking about being responsible with the federal budget and the Republicans aren't. It's kind of a turn of events.
Neil Cavuto: I think we can argue or debate that. What I found refreshing in this whole thing was that everyone showed their cards. By Clinton and Obama signing onto this, they kinda said “You know what? We're ok with this. We know it's a $3 trillion blueprint and it's not worth the paper it's printed on, but it sorta gives people an idea as to where Democrats are coming from.” That to me said everything I needed to know.
Tracy Byrnes: Yes, total foreshadowing what could happen with a Democrat in the Oval Office. And I agree with Adam said to an extent. I understand that the money has to come from somewhere, but I think it's more about psychology and sentiment right now. To tell anyone, and even if that 3 percent equated to $50 on their tax return, it's $50 they don't want to give up. And its $50 they aren't going to put back into the system.
David Nelson: Well, I don't think the dollar plummeting precipitously because we have an enormous deficit is a perception. It's real. And it's affecting us.
David Nelson: Something has to be done.
Charles Payne: Since we had the Bush tax cuts, our revenues have gone up dramatically. What we have to do is address the spending aspect of it.
Ben Stein: That is just not true.
David Nelson: But you know it won't happen. As long as we have an electorate, excess spending will happen.
Charles Payne: If we keep adding more entitlement programs… yes, absolutely! And if we keep saying, “Keep adding ‘em and keep going after the rich” at some point, Ben, even people making over $500,000 are going to get squeezed dry.
Ben Stein: No, I said people making more than $1 million, actually. The fact is if you look at the data, revenues fell dramatically between 2001 and 2006… after the Bush tax cuts. We do need higher taxes on the rich. It's just morally wrong for the rich people to be living as lavishly as they are when there is so much need.
Neil Cavuto: You know, Ben, I love you dearly… but put a number to it. Are you in the Charlie Rangel camp that says 45 percent is an acceptable level to pay in taxes? Be careful what you wish for. What I'm saying is if you are attaching a new higher percentage to the wealthy and telling them paying a third of your income is not enough… if you're also saying the government can't make due taking more than a third of your pay… what does that say about the government and shouldn't that be the issue?
Ben Stein: That is a threat. But the fact is the government cannot cut spending. It's just a myth and a fairy tale that the government can cut spending. Spending is going to go zooming upward parabolically. I don't have any problem taking 40 or 45 percent at the margins for very rich people. And if I may say so, over the next couple of years while I am working, I will probably be paying that. I just feel it's our due.
Neil Cavuto: We disagree. We respectfully disagree.
Head to Head: Should Leaders Be Fired From Their Jobs for Private Mistakes?
Neil Cavuto: Sex scandals destroying the careers of a lot of high-profile Americans from New York's governor to corporate CEOs. But, is it fair to force out people for something they did in the bedroom and not in the boardroom?
David Nelson: Like we really need the morality police again. C'mon. How many times does this have to happen before we learn this lesson?
Neil Cavuto: Let me stress here that you are a former rock star.
David Nelson: That aside…
Neil Cavuto: You're maybe the last person who should be talking about this…
David Nelson: Ok. Maybe. But, I don't think anyone should lose their job for a personal indiscretion.
Neil Cavuto: Nonono. Dave. It was taking essentially a prostitute over state lines, which is not only a no-no… it's a crime. And Spitzer was the moral leader on ethics and going after prostitution rings… and he was enjoying the prostitution ring.
Ben Stein: Well, we don't know that he enjoyed it.
David Nelson: With all that's going on in the world today, I've got a lot more to worry about than whether or not Spitzer or Clinton or any other leader is getting it on.
Neil Cavuto: You don't mind your elected leader frequenting a prostitution ring?
David Nelson: I don't care at all.
Charles Payne: You know what? A public official is just that… part of the public. You've asked the public to put their trust in you. I do believe there has to be a set of standards for public officials…
Tracy Byrnes: But you can't put a camera in his bedroom.
Charles Payne: No! I'm not saying put a camera in his bedroom. I don't want a camera in his bedroom. I trust the government. I also want to know that they put themselves on a different plane than me and they can't make the mistakes that maybe I would make.
Tracy Byrnes: Well, what if he didn't break the laws? What if he didn't send money over state lines, send the girl over state lines, what if he didn't make those stupid mistakes? What if he did it downtown and you never knew about it?
Charles Payne: The bottom line is there's a moral line and he blew it. I don't think you should be in public office if you don't have the right morality.
Adam Lashinsky: I would take it a step further. You used the word earlier, Neil… you said leader. I think any leader has a responsibility to set an example to your followers. If you're a follower in an organization, be it a government or a corporation, that's fine. You live your life. No one's asking you to set an example. But, a leader gets a lot of privileges for being a leader and also a lot of responsibilities. We expect them to behave in a certain way.
Ben Stein: Well, when Jesus came upon the Pharoses trying the women for adultery, they said, “Don't you agree she should be stoned?” And Jesus said, “Absolutely, but let he who lives without sin cast the first stone.”
David Nelson: Absolutely.
Ben Stein: Everbody is sinning. We're all sinners. It doesn't affect in anyway someone's ability to be president. John F Kennedy probably had the most women of anybody and he's generally considered a pretty good president.
Ben Stein: I don't buy it at all that what a man or woman does in terms of sex affects his or her behavior as a leader and should lead to them being kicked out.
Neil Cavuto: But Ben, would you make an exception for the leader who preaches just the opposite?
Ben Stein: I would not make an exception because hypocrisy is a basic part of the human personality.
Charles Payne: I think this is outrageous. At some point, we have to have a moral compass.
Neil Cavuto: But Ben is right on this point: There were a lot of great presidents who've had mistresses and worst and yet in history they did ok. And in companies as well, we've had some pretty high testosterone CEOs.
Charles Payne: I draw a line between a corporate executive and a public official. If you are the governor or president, you should be at a higher level.
Tracy Byrnes: Where does it stop? So prostitutes are no good. But, what if their marriage has failed? That means I could never be governor. Where does it stop?
Charles Payne: Nonono. There's a big difference between having a failed marriage and getting a prostitute.
Tracy Byrnes: You don't know why the marriage failed.
Neil Cavuto: That's interesting. If even a fraction of these allegations turns out to be right and Spitzer was frequenting a prostitution ring and taking a prostitute over state line…
Ben Stein: Who cares?
Neil Cavuto: No, no, no. The fact of the matter is it's a crime. And maybe you don't think it should be a crime. But, you have an elected leader who's not only fooling around… he's doing it with a prostitute. You're fine with it, but it's a crime.
David Nelson: It's a parking ticket kind of crime to me.
Ben Stein: It's a very small crime.
Charles Payne: Let me answer one question here. You and Ben keep saying, “Who cares?” But until a week ago… Eliot Spitzer cared!! He went after prostitutes.
David Nelson: So he's a hypocrite.
Charles Payne: He would have arrested himself, wouldn't he have?
Adam Lashinsky: You're saying, “Who cares,” but I'll tell ya… we get to decide as a people who cares. So two generations ago, people cared about divorce. But, today we understand marriages fail. That's how it works. We decide these things on a case by case basis.
Ben Stein: We didn't decide. The New York Times decided and the federal prosecutors decided. We didn't decide.
More for Your Money: Stocks Ready to Rock!
Neil Cavuto: Madonna making it into this Rock and Roll Hall of Fame this week. Now, our stock stars have the name that will have you rollin' in the dough just like the Material Girl!
Adam Lashinsky: Granite Construction (GVA)
David Nelson: Gafisa SA (GFA)
Ben Stein: iShares Emerging Markets Index (EEM)
*Ben owns shares of this fund.
Charles Payne: Mastercard (MA)
FOX on the Spot
Charles Payne: Bear Stearns Lied! Trust "GS" with your Cash
Adam Lashinsky: Fed Saves Bear Stearns & Everyone Else; Bad for Market
Tracy Byrnes: Car Sales Crashing; U.S. Auto Industry in Trouble
David Nelson: Silver Lining to Economy is Prices at Stores Will Drop!
Ben Stein: "Irrational Caution" Will Pass; Buy "RQI" for a Safe Dividend
Neil Cavuto: At this rate, we can all be rich. Democrats approving their own $3 trillion 2009 budget plan that wipes out the president's tax cuts effectively raising taxes for those who earn as little as $31,000 bucks a year. Congratulations! Last year at this time, a million bucks made you rich… now $31,000.
In Focus: Are Dems in Congress Playing Politics With Gas Prices?
Josh Lipton, Forbes.com Staff Writer: Listen, if you hear democrats whining about those gas prices, don't believe it for a second. Those are crocodile tears. They know a weak economy hurts the republicans that have been controlling the White House for eight years. Democrats know it. That's the game they're playing.
Quentin Hardy, Silicon Valley Bureau Chief: Josh, which thing is it the democrats are doing? Have they got the oil fairy locked up and otherwise she would wave her sparkly wand and bring prices down? Or are they letting the market do what it's doing? Short-term, policymakers can't do anything about prices. Everybody knows that. Long-term, they could set up policies which would change things. The policies in question might be getting the deficit down, helping the supply situation out of Iraq. Forget about ANWR, there isn't enough there. Setting higher fuel efficiency standards, maybe doing something about nuclear power and other alternatives - but those are long-term things. They won't get prices down by November doing that.
Steve Forbes, Editor-in-Chief: The democrats playing politics with the economy? I'm shocked! What's the world come to?
Of course they are! They are blocking ANWR in Alaska which would bring billions in oil, blocking the outer continental shelf where there are literally tens of billions of barrels of oil and gas equivalents. They're blocking nuclear power, they're playing that game. Another factor is the Federal Reserve is printing too much money, which is like putting too much fuel in the engine of a car. That's sending up prices.
Mike Ozanian, National Editor: They're not helping, that's for sure, but we have come to expect that from the democrats. The real problem is the Federal Reserve, like Steve said. The money supply has been too great. We have seen the value of the dollar plummet. As the dollar plummeted, the value of gas has gone up. Gas is going to $4.50 a gallon this summer.
Neil Weinberg, Senior Editor: I don't think there's a smoke filled room where they are all saying ‘Let's pump up the price of oil,' but I think the things that would bring down the price of oil aren't the things they're pushing right now- nuclear power, refineries. Make the democrats say we need a strong dollar. That would help relieve some of the pressure, too.
Victoria Barret, Associate Editor: I have a news flash for everyone – John McCain doesn't want to drill ANWR either! This is on both sides. ANWR isn't a fix. This is a long-term problem. It has a lot to do with the dollar, which frankly neither party can really address. It has a lot to do with what the Fed is doing. This isn't about the democrats and the republicans, shockingly.
Flipside: Spitzer Le$$on: Legalize Prostitution and Tax It Now!
Victoria Barret: An odd opinion coming from me, but the current situation we have isn't a good one. You can make prostitution illegal, but you can't make it unpopular. When something is illegal, it operates in the shadows. Prostitutes now have high homicide rates, high drug abuse and alcohol abuse. If you bring it out of the shadows, you can police it better. You can enforce standards. You can give these women rights that they don't have right now and won't have so long as prostitution is illegal.
Steve Forbes: First of all, New York would tax it so much they would put it underground anyway like they do everything else. More prostitution, even where it is legal in places like Holland, means more drug abuse, it means more sexually transmitted disease despite all the happy talk about examinations. It means more sex workers and exploiting women from Eastern Europe and elsewhere and the sexual slave trade. We don't need more of that.
Elizabeth MacDonald, Fox Business Network: There's a mixed bag when it comes to this. I hear Victoria saying taxation would work. You do want more regulations. Prostitution has been around with us for centuries. It's not going to go away. Here's the problem, when you do regulate it, what happens is you get illegal immigrants, in other words, Steve is right, a black market. Sex trafficking goes up because the pimps, don't want to comply.
Evelyn Rusli, Forbes.com Anchor: I would say no. If you legalize this industry, you pretty much open Pandora's Box. You bring in all these vices like drug abuse and human trafficking. Beyond that, how will the government regulate it? We can't even regulate meat or toys or anything!
Neil Weinberg: Absolutely. If you take your argument to a logical extreme, what you have here is, ‘Gee, why don't we make alcohol illegal again because it just promotes gambling and partying and people not doing their homework?' The fact of the matter is, prostitution is with us. If you're a true conservative, you don't go around trying to moralize and tell people how to live their lives. This is a transaction between two consenting adults. That's their business.
Quentin Hardy: You have to go off experience. Alcohol is a predictable case because it was baked into this society beforehand, and they tried to make it illegal. Let's look at some of the things they have taken out of the shadows. Porn. We made porn legal, and now it's everywhere. I can take my kids to any airport newsstand in the country and they are in a visual sewer. Gambling. We made gambling legal to help the schools, and the schools are still rotten. Jack Abramoff represented a bunch of Indian tribes and we had gambling lobbyists in Washington. Now prostitution. We're going to tell the men that it's ok to rent women's sexual organs for their fantasies, these women who typically come from broken homes, drug abuse, what have you. Spare me this high class hooker stuff. It's not true.
Democrats Raising Record Amounts of Cash: Good News for the GOP in November?
Elizabeth MacDonald: Here's my logic. Basically all of this money that they are raising is going towards these attack ads which are splitting the democrats in half. The race for the democratic presidential nominee is falling along these cultural fault lines, Obama being his race, and Hillary her gender. It's energizing the Republican National Committee which is raising way more money than the democrats. The issue now is which side does the country want to go with? I think the angry populist message from the democrats will undermine them and hurt them.
Steve Forbes: Actually not. It means the democrats have a race that keeps John McCain off the front pages. He has to do a lot of work to get his biography out there and his views out there. It also means the democrats have millions, especially with Obama, millions of new donors that can go into the general election. If Obama gets the nomination, it also means millions of younger voters that will not just vote for him, new time voters, but also the rest of the democratic ticket. That's not good news.
Evelyn Rusli: We're already seeing some donor fatigue when it comes to the DNC trying to raise money, they are way behind. They only have $3.7 million in the piggy bank now. Compare that to the Republican Party, they have $25 million. They are raising more money at a higher momentum than the democrats.
Quentin Hardy: I think the democrats are learning a heck of a lot about internet style fundraising where you get a million people to each give you $50 instead of a few people to get you $2,300. The $2,300 people get tapped out right away whereas the $50 people can come back and back and back.
Josh Lipton: I think Clinton and Obama have been pulling in a lot of money, but House democrats are doing a good job, too, reportedly more than republicans. The broader issue is there is so much more favoring the democrats right now, this desire for change in the country. It's a weak economy. Obama is a rock star. That party is energized.
Informer: Stocks That Go Up When the Economy Goes Down
Mike Ozanian: Boeing (BA)
Josh Lipton: McDonald's (MCD)
Victoria Barret: Quest Diagnostics (DGX)
Evelyn Rusli: eBay (EBAY)
Our Cashin' In crew this week: Jonathan Hoenig, CapitalistPig Asset Management; Jonas Max Ferris, MaxFunds.com; Dagen McDowell, FOX Business Network; Wayne Rogers, Wayne Rogers & Co.; Matt McCall, Penn Financial Group; Chris Kofinis, Democratic strategist; Father Jonathan Morris, FOX News contributor.
"Sheriff of Wall Street" Falls: Will It Help Stocks Go Up?
New York Governor — and former state Attorney General — Eliot Spitzer resigned Wednesday amid a sex scandal. The news was followed by cheers on Wall Street, where many felt the one-time A.G. abused his power in rooting out corporate crime. So now that the "sheriff" is riding off into the sunset, will it be a new day for stocks?
Matt: Let's think about this. Unethical. He's a liar. He is a hypocrite. He is vindictive. That's who I want overlooking my stock market? No way. All he was doing was over-regulating the industry and pushing his own political career by going after headlines. That's all he was getting. He was going after big name firms, big name analysts, and by doing this, what he was doing is fining them a couple million dollars, which really wasn't affecting Wall Street. Now that we don't have him looking over our shoulder, we can get back to business and not have to deal with this crazy guy just out for himself, not really looking out for Wall Street.
Jonathan: Unfortunately we have new sheriffs of Wall Street out there. Attorneys General in Florida and Connecticut are basically trying to follow in Spitzer's footsteps. But it's good to get this kind of dead wood out of the way. This is a very dangerous guy, politically motivated, total megalomaniac He is so busy playing governor with daddy's money that he forgot the rules apply to him as well. Yeah, I'm glad to see him gone.
Wayne: You can say some of the things he did did some good but Jonathan is right: he was a megalomaniac. There is no excuse for that. He was a hypocrite of the worst kind. Of course he deserved this downfall. Here is a man who took an oath of office, who violated that oath, he violated the law, and he is supposed to uphold the law. It's the worst kind of behavior you could have.
Dagen: Spitzer out of the governor's office does not matter to Wall Street because he has not been the A.G., the attorney general, for some time, and that's where he was a problem. As Jonathan pointed out, Wall Street has a lot of other sheriffs spread across this country, in Washington as well, to worry about right now.
Jonas: His stop at the governor's mansion was en route to bigger and powerful things where he would have been back all over Wall Street's you-know-what. The reality is I think Spitzer, a lot of the things he did, helped shareholders. To some extent, some investors and people. However, I don't think it helps Wall Street's profits. A lot of the companies he went into, they like those practices. Maybe the practices in insurance were questionable. I know what he did the mutual funds. That was a questionable practice that made money for mutual fund company stocks.
Pay Bad Teachers to Quit?
An anti-teachers' union group is offering the nation's 10 worst unionized teachers $10,000 to take a hike. Is that a good or bad idea?
Jonathan: Life and business and education require change, especially when you have terrible teachers. Unfortunately, the unions hate change. They have ruined the public schools just as they have ruined the steel business and the automakers and every other business they have been a part of. When it comes to the unions and the public schools, it's kind of like the inmates running the asylum.
Chris: That's just ridiculous. No one wants to defend bad teachers. There are bad teachers just like there are bad people in every profession. The major reason why we have so many serious education woes in this country is because we have so grossly under funded education across America. This is becoming a serious problem. We have to become, I think, very serious about our priorities. If we want our educational system to be the best in the world, which it should be, we need to become, I think, more focused on funding these programs.
Wayne: Any profession, regardless of what it is, you ought to have the ability to get rid of bad apples. However if they are accredited teachers and they had to take a test of some kind that allowed them to keep their tenure, that would be fine. Tenure in and of itself just because you have been there a long time and you are still bad and you are perpetuating that is terrible. They have to find a way to get around that.
Dagen: If you look at the big markets or the big areas in the country, most — the vast majority of administrators have the ability to fire a teacher for poorly performing. It's not like every administration, every high school, every elementary school, that the principal or the administrators have their hands locked. It's just not true.
Jonas: I think you're getting to the heart of why this is a stupid offer. Thanks to the unions, public school teachers get one of the highest amount of their pensions throughout their lives. They'll have to pay at least $100,000 to get a bad teacher to walk away from that gravy train when they retire. And insurance, by the way. Unions are a net negative in the education industry. But take the unions out of the equation, you would have tenure which would effectively do the same thing. You don't need unions to have tenure. It just happens in private colleges across America.
Is It a Sin to Make a Lot of Money?
The Vatican is reframing the seven deadly sins, updating them for the 21st century. One of them: financial gluttony. So is it a sin to make a lot of money?
Father Morris: Let me clarify this quickly. There is no doubt the Vatican is not in any way saying there are new seven deadly sins, and they are not saying that money is bad. What we are saying is very clearly this. If we dedicate our lives to opulent living, exaggerated opulence while making bigger the gap between the poor and the rich, then we have got some soul searching to do I hope that's clear.
Jonathan: How do the rich become rich? They become rich not by looting or robbery, but by providing a service that people value or people want. I know the church tends to love charity more than wealth creation, but I have more respect for people who make money, much more respect than people who just give it away.
Matt: You have to make money to give it back. That's kind of my issue with the new sin is the fact that two things: Jonathan made a point: how do you become rich? You have to work hard, to get that money. When I go to church on Sunday, the basket always comes in front of me. If I'm not out there making money, how will I make the money to build the church, to make it better, to get the word out? You have to go out and make money. That's what this country, this world is built on.
Jonas: That's why I think it's sound advice. It's not saying you can't make money or make a lot of money. Especially if you are giving to going to give some back. They are talking about financial gluttony and the way the country, the globe has grown, in the last few decades; people are obsessed with consumption and living high off the hog, even if they have wealth, to buy all they can and lose touch with the rest of the world and how other people are living. I think there is good advice there.
Best Bets: Most Recent Buys:
Our money gurus reveal their most recent stock buys.
Jonathan's pick: CurrencyShares Australian Dollar Trust (FXA)
Wayne's pick: Applied Materials (AMAT)
Jonas' pick: NFJ Strategy Fund (NFJ)
Matt's pick: Penn Nat'l Gaming (PENN)