Skip to main content

tv   FOX Business After the Bell  FOX Business  January 18, 2013 4:00pm-5:00pm EST

4:00 pm
biggest loser on the dow. weak numbers. revenue was weak. profit dropped. the outlook certainly doesn't sound promising, not a good day for intel and tech. liz: we had some breaking news in the last hour on a stock that some people may own, the tsa decided to remove those scanners that they use at the airports. nicole: they were so controversial. liz: the stock has an interesting reaction here, it is moving up. nicole: right because analysts are saying it was an overhang and the fact they are getting rid of that, the machines don't actually generate that much revenue. they have all kinds of electronic systems that osi does so it takes away the overhang and all the controversy that surrounds those machines at the airports. david: let's switch to banking. goldman sachs hitting new 52 week high. but look at morgan stanley. up almost 8% and of course it was all because of charlie's terrific interview with jim gorman, about which we're going to hear more in this hour. nicole: it was a terrific interview.
4:01 pm
the truth is they are hitting some new highs. a lot of folks i talk still believe financials will be great in 2013. some of them are really doing well. liz: it's a great day at least for some of the handful of companies that are out there today. [closing bell ringing] liz: a carpet company, interface, we just had the ceo on in the last hour, they make the square -- do you see how they're holding up the pieces of square? that's carpet. david: if you have seen it on the news chances are you have seen it here even before it happens on the news. the bells are ringing. let's take a look at the indices. only one index is in the negative, that would be the nasdaq. apple not managing to find ground again today being pulled down. we thought maybe it had reversed that downward trend yesterday. not so today. all the other indices, though, in the green. some particularly spectacular moves i'm thinking of morgan stanley and there's some other stocks we will be talking about this hour. liz: even though we got a dicey consumer confidence number, investors seem to believe in at least one thing, and that's the housing comeback.
4:02 pm
the phlx, the housing market sector hitting the highest level since 2007. and that happens today. david: natural gas continues to rally, moving up another 2%. so far this commodity is up more than 6% so far this year over last year it is up more than 50%. so the move is on for nat gas. liz: but there's a little complacency out there in the market, try the volatility index, it continues to tumble. it fell to its lowest level since june of 07. the real height of the housing bubble; right? so be careful when you see this. david: i don't think i have ever seen it in the 12 category. the house looking to vote on raising the debt ceiling next week looking for a temporary, temporary three month increase. coming up we will find out what representative thinks about the plan and why she is looking to get rid of the debt ceiling all together. liz: plus we have the bond king of canada who knows plenty about our markets. five years ago he said that investors had the opportunity of
4:03 pm
a lifetime to buy stocks, just as we hit bottom, and we saw that bubble explode. well, he was right. now, what is he saying? 2013 holds the second buy of a lifetime? what is it? and how can you take advantage of it? he is here to talk about it. david: liz has that interview all to herself because i can't begin to pronounce his name. let's tell you what drove the markets. mixed day on wall street with s&p and dow closing in the green. all three major indices ending the week higher. industrials and energy were today's top performing sectors while technology was the only sector ending the day lower. and oil ending the week in the green after the international energy agency raised its global oil demand forecast for the whole year. crude's settling the week up 2.1% at $95.56 a barrel and consumer confidence falling for the second month in a row, dropping to its lowest level in one year. the overall index declined to 71.3 from 72.9 in november.
4:04 pm
liz? liz: we've got a trader in the pits of the cme and our market panel, chief investment officer at global financial and also janney capital markets technical research director is joining us. let's talk about how most of the session was a very quiet tentative day and suddenly the dow and s&p took off. to what do you attribute that? >> it was an interesting day. we built off of yesterday's economic data which was very supportive. today was a little bit weaker. it was the earnings. it was mainly morgan stanley and a lot of traders were kind of waking up to that news as the day went on. we pushed up and you've seen a lot of talk about equities hitting five year highs. that's bringing in new investors into the market. we're starting to see some capital flows coming in. volatility is nonexistent right now. it is a real nice calm market to be participating in. it is almost like getting in a boat letting the wind behind your sails blow you down the river. david: sometimes markets do like
4:05 pm
these walls of worry that they claim and there are as you mentioned china seems to be growing nicely now, europe at least for the moment is calm, congress even looks to be settling its debt deal with a three-month deal, granted it is only three months but at least it is something. so what about there not being a wall of worry to climb? is that a problem for the markets in in way? >> you know, well i do think we will be susceptible to some kind of washout maybe after february, maybe once the debt deal is announced, it's buy the rumor something is happening and sell the fact when it finally comes out. the type of trade we look for is where the s&p 500 hits some kind of target like 1500 and then closes lower on the day. that's where you want to say hey there's been a shot across the bow and we may get some momentum a little bit lower maybe take something off the table there. liz: s&p target still at 1500, the momentum would be to the down side you're saying possibly, so do you -- when do you get in here?
4:06 pm
>> well, you start looking at other assets for maybe underpriced assets for safety. i mean we already started to see gold start to creep up a little bit, silver. as well as the volatility index always works as a nice little hedge for accounts. maybe consider putting some money into that but i would say keep an eye on the upside. i think we're still going to travel higher but look for that key reversal day when it happens and that's the day you start reassessing things. liz: okay. we will see you in a few minutes when the s&p futures pits close. getting noisy in there. david: it is getting exciting. we will get in on the action. let's bring in the market panel. they join us now. dan, let me go to you first because we have been hitting on this theme that maybe we are setting up for a little bit of a drawdown of these gains, these spectacular gains we have had since the first of the year, do you think a drawdown is coming and might you hold your cash until then? >> yeah, i mean, certainly a drawdown is coming.
4:07 pm
you know, the question is to what extent? you know, momentum in the markets as we push to new highs on the s&p 500, again, hitting that 1475, moment you mean started to wane a little bit. i think the bulls are getting tired. so you know this could set up for a bout of profit taking. underneath the surface, we're also seeing rotation, so a lot of the names and a lot of the sectors that worked in 2012, they may be susceptible or vulnerable to a bit more profit taking so you want to be careful there. liz: could i ask you dan, which sectors? i mean financials obviously did very well in 2012, would they be ones that are just a little bit susceptible to this? >> well, you know, look, it would be across the board in my opinion. but the most vulnerable group would probably be the consumer, the consumer was the big story of 2012. it turned into a very crowded trade. and there were other sectors did well, they were laggards behind that space, so we would actually look to that as a source of funds and quite frankly we think the institutional community is
4:08 pm
rotating those funds right now into new groups. these groups are going to emerge as new leadership. this would include early cyclicals, materials, industrials. it would include the banks, the financials. i think at some point it is going to include technology as well. so what we're going to do is in trying to gauge what the correction is going to be, how intense it is going to be, but we're going to get our shopping lists ready for those new groups that we're going to look to be buyers on weakness at that point. david: dan has some specific stock picks we will get to that in a second. chris, the theme, we had a great start to 2013 but you say it's going to be a slow grind for a while, no? >> absolutely. i think david the drag on the fiscal cliff is probably about 1% of g and p. i think you will see much better third and fourth quarter with
4:09 pm
growth somewhere around 2%. liz: what do you like? what would you be investing in as that process continues? >> well, i think the market makes something cheap every day. and nobody's made any money by panicking, and the last quarter they panicked out of morgan stanley and look at it, it's a hero today. same thing is true with intel. you know, they are writing off the intel complex as being dead, but anybody who examines it beyond the surface will see that they are a powerful firm, their metrics are cheap, they are cheaper than adi or texas instruments or anything out there, and who knows, i can see apple using them more as a supplier and you're getting a value right now. david: intel is low and that's the time to buy. >> i would look at it. david: dan, i have noticed sort of a pattern in your picks. you have a steel products maker and also commercial metals. why are you putting these
4:10 pm
commercial metal manufacturers in now as a buy? >> yeah, absolutely. anything that's levered to construction, anything that's levered to infrastructure, buildout, here in the u.s., perhaps multi-family construction, we think that is going to be a new leadership sector. i mean we all know homebuilders have done very well, specifically in 2012. but we think that's a theme that's actually going to gain traction. when we look at a lot of early cyclicals, early material plays, they are all coming off huge huge accumulation bases. what that tells me is that quietly, you know, behind the scenes, people have been scooping these stocks up before, you know, the crowd, before the press is really getting on top of it. david: let's get this real quick, is now the time to buy or would you wait for this pullback? >> i mean, it's always a matter of timing. you know, to be honest, i'd probably wait. i personally think we're in the window for a correction that could last until maybe of the
4:11 pm
first, second week of february. so i'd be very careful coming into next week especially if the s&p breaks below 1470, maybe hold, and then come in in the next few weeks. liz: chris, we're going to put some of your other stock picks you like in some financial areas, but if there were one mistake you feel investors are about to make and you would want to warn them off that, what would it be? >> well, i think agree with the other guest on consumer discretionary. i would be very careful about retail stocks in here. liz: retail, because the consumer maybe is just a little bit of a tired trade there. >> well, with a 1% increase -- i mean 2% increase in taxes with payroll, it is like a dollar increase in gasoline. so they are going to have to find it from somewhere. david: i love your analogies. dan, thank you very much. and chris, gentlemen have a great weekend. appreciate you coming in. >> thank you. >> thank you. liz: our government has money to
4:12 pm
pay the bills for about another month, but the house is going to vote just next week on raising the debt ceiling, at least temporarily. is there a real chance we won't need to wait till the last minute for a deal? we will have the latest. david: interesting novel concept. plus, reaction from a member of congress who is looking to say good-bye to the debt ceiling all together. that representative is going to be here for a debate coming up. liz: while the battle wages in washington, you could be profiting. i mean, listen, come on, don't wait. find out how you can trade the debt ceiling. there is a way. keep it right here on fox business.
4:13 pm
♪ [ male announcer ] this is karen anjeremiah. they don't know it yet, but they' gonna fall in love, get married, have a couple of kids, [ children laughing ] move to the country, and live a long, happy life together where they almost never fight about money. [ dog barks ] because right after they get married, they'll find some retirement people who are paid on salary, not commission. they'll get straightforward guidance and be able to focus on other things, like each other, which isn't rocket science. it's just common sense. from td ameritrade. [ male announcer ] how do you turn an entrepreneur's dream... ♪
4:14 pm
into a scooter that talks to the cloud? ♪ or turn 30-million artifacts... ♪ into a high-tech masterpiece? ♪ whatever your business challenge, dell has the technology and services to help you solve it.
4:15 pm
liz: shares of monster beverage falling today. this has been a volatile stock on all kinds of headlines. let's get back to nicole on the floor of the new york stock exchange. nicole: liz and dave, you know, we follow monster energy drinks so closely and sometimes people just need some energy, they go right to those monster energy
4:16 pm
drinks. here's the ticker symbol today and how it fared today. you can see it was down. and one of the reasons why is because there's been talk that -- obviously the famous hedge fund manager may be shorting the stock. now we have seen what happens went he shorts stocks. we have seen it with other companies when they sell off dramatically, morningstar actually told dow jones they think that that was because of the chatter on twitter that it may be him; right? what we're seeing here, one of the other reasons and clear reasons why monster may be coming under pressure is because you have lawmakers now sending letters to 14 energy drink makers, including monster beverage, asking more about the ingredients, potential health problems. we reported that many people drink energy drinks, they are in the hospital with heart conditions, did they have a prior condition? all of this requires so much more investigation. but the investigations have begun. back to you. david: i'm under the influence right now, five hour energy. i took a shot before i came on. five hour, once a day, i do a
4:17 pm
five hour energy. liz: you do? david: yeah, i'm fine. the s&p futures are closing right now. let's head back down to the pits of the cme. what do the futures tell us about monday morning phil? >> well, i mean monday most of us are going to be off here for martin luther king but we'll still be watching out for earnings all next week. we will be looking at economic data. keep an eye on, you know, any progress on budget talks. that's about it here. liz: good point. thank you, phil. david: house congressional leaders announcing today that they will vote on a debt ceiling bill next week that will include at least a short-term extension. liz: rich edson live at the house republican annual retreat which is in williamsburg virginia with the very latest. rich? rich: liz and david, a three month extension, that's what they are discussing. this is a result of three day meeting here, the republican retreat in williamsburg virginia. this is the bill that the house
4:18 pm
will vote on next week, a three month debt ceiling increase and debt ceiling increase is contingent on the house and senate passing a budget. the senate hasn't actually passed a budget in years. the bill also withholds congressional pay without congress passing a budget. the one problem with this for a number of republicans, there really are no other spending cuts in this. remember the boehner rule dubbed the boehner rule says any increase in the debt ceiling must correspond to equal amounts in spending cuts. >> not quite the same reaction from house minority leader nancy pelosi saying:
4:19 pm
>> so the republicans are taking the debt ceiling debate moving it off a few months perhaps take place in april or may so they can focus on the automatic spending cuts set to hit the budget at the end of february those are known as sequester and also government discretionary spending authority that runs out in march. plenty of budget fights and it looks like we will be having them just about every couple of months all the way through the spring. david: as long as you are in williams burg virginia what do you care? it is a lovely place to be right now this time of year. rich: yes and the wind has died down and the snow is melting. it's a nice place. david: thanks rich. liz: we will find out what a representative thinks about the debt ceiling bill that will hit the floor next week and find out why she's calling for congress to get rid of the debt ceiling all together. david: also, all the fighting in d.c. could create a big opportunity for you the investor. find out exactly how you can trade the debt ceiling a little later this hour. it will be fun.
4:20 pm
at a dry cleaner, we replaced people with a machine. what? customers didn't like it. so why do banks do it? hello? hello?! if your bank doesn't let you talk to a real person 24/7, you need an ally. hello? ally bank. your money needs an ally.
4:21 pm
4:22 pm
4:23 pm
david: the house g.o.p. is set to vote on a temporary debt limit next week but some legislators are saying just get rid of the debt ceiling all together. one of them joins me now illinois congresswoman jan schakowsky. thanks for coming in. we appreciate it. >> thank you. david: i have to bring up some of your history with regard to the debt ceiling. in 02, 04, and in 06 you voted not to raise the debt limit ceiling which leads me to ask why if you voted over and over again for a strict debt ceiling are now for getting rid of it all together? >> you know, a number of us voted no, knowing that it was kind of a protest in the symbolic vote about war spending, etc., that we didn't approve of, but never thinking that it was because we didn't
4:24 pm
want to ultimately pay the debt of the united states of america. now it could have devastating consequences if we actually were not to pay the bills and disturb the full faith and credit of the united states of america. david: but you look at the way the debt ceiling has increased. the last three years of the bush administration, granted it was up, and you had reason to be for some strict funding rules, but it went up 1 trillion from 06 to 09. from 9 to 10 trillion. but then in the first three years of the obama administration it went up 6 trillion dollars, from 10 to 16 trillion dollars. don't we need something in there to discipline congress and the president about spending? >> you know, this idea that democrats need to be disciplined, it isn't that long ago -- david: i'm saying democrats and republicans, congresswoman, it's not just democrats, both of you. >> let me say it was not that long ago that we had a
4:25 pm
democratic president that actually handed off a large surplus as far as the eye could see really to a republican president that then put everything on the credit cards, that blew up the debt and the deficit. and then we ended up with a near depression, a recession, and so clearly of course some spending was going to go up, but actually it's gone up slower in the obama administration than it did in either bush or the reagan administration. david: hold on a second congresswoman. i have to argue with that point. because we just put up the numbers. as i said the last three years of bush it went from 9 trillion to 10 trillion. the first three years of president obama it went from 10 trillion to 16 trillion. that's a huge increase. >> well, but this is not because of spending -- this is because the government has been spending
4:26 pm
to -- more people are on programs because of the unemployment etc., and so we have had a problem. i was on the simpson bowles commission. i actually introduced my own plan that did more deficit reduction, including, for example, creating a public option in healthcare that would save 104 billion dollars over ten years. so there are ways that we can do it, but to say that we're not -- we're going to jeopardize the economy of the united states and frankly even the world by not paying the bills that have already been incurred is absolutely -- [talking over to each other] david: you were willing to bring us to that brink in 02, 04, and 06. >> no i wasn't. david: you voted in favor of keeping the debt limit ceiling right where it was, that was the same kind of danger in going over into that default mode, no? >> it wasn't because that was a kind of protest vote knowing very full well that this was going to pass.
4:27 pm
are we seriously going to not let president bush pay for the debts that had been incurred? i absolutely would have voted in favor of raising the debt ceiling. david: final question about spending because i'm getting a wrap here. >> sure. david: we had in 2008 we had spending level of about 3 trillion dollars. in 2009 that ballooned up about 20% to about 3 1/2 trillion dollars. now, a lot of that was because of the stimulus program, which was part bush and part president obama. but then we remained at that level for the next four years. 2012, 3.5 trillion dollars. this is a stimulus that never ended. isn't that the cause of our debt problem? >> well, you know, actually president obama has signed into law 2.4 trillion dollars worth of debt reduction three quarters of which -- david: that's in the future, that's pie in the sky congresswoman. i'm talking about what's actually been spent. >> i know, and are you suggesting now that we should not pay those bills?
4:28 pm
is that really what you think? that we should not pay the bi s bills -- that we should not pay the bills? >> what i really think is we're not going to get the spending that we were promised. every time we're promised cutbacks in spending, we don't get it. >> that's into law. there's many many things that very been cut, and we're willing to go further. but to say that we're going to not pay the bills that have been incurred is just lunacy. david: the hardest question i have asked you so far, is evanston illinois still the most beautiful place in the world? >> it is absolutely the most beautiful place. we agree on that. david: i used to live there. congresswoman great to have you. have a wonderful weekend. >> thank you you too. david: appreciate it. liz: in an interview earlier this week whole foods market co ceo referred to the new healthcare law as quote more
4:29 pm
like fascism than socialism. his controversial comment got so much backlash from the company's customers that he is now backing off those comments saying it was quote a bad choice of words. our own neil cavuto got a chance to sit down with him and ask him why he said what he said about the issue. >> when you started getting vocal on these issues, i think you always have been, you had a very strong point of view when it came to the role of government and the private sector, what brought it out or got it really big? was it the campaign? >> i don't think so. i mean, i was very concerned about the healthcare law. i thought it was going to be bad for business. >> why? >> it is going to drive up costs. liz: you want to see more of that? be sure to catch the full interview tonight at 8:00 p.m. eastern right here on fox business with our own neil cavuto. david: that will be fun. we mentioned just a moment ago the house is looking to vote on a bill to increase the debt ceiling temporarily, but the
4:30 pm
battle is sure to drag on. up next, the man who wrote the inside story on the lehman collapse telling us how to trade the debt ceiling and actually use the fighting in d.c. for your financial advantage. liz: plus the man some call the bond king of quebec says the second buy of a lifetime is coming up. he already called the first buy of a lifetime a couple of years ago. he was right. will he be this time? he will tell us what it is coming up. you decide.
4:31 pm
. . . . . . what are you doing?
4:32 pm
nothing. are you stealing our daughter's school supplies and taking them to work? no, i was just looking for my stapler and my... this thing. i save money by using fedex ground and buy my own supplies. that's a great idea. i'm going to go...
4:33 pm
we got clients in today. [ male announcer ] save on ground shipping at fedex office. david: well could the end of the debt ceiling debate sooner than expected? the house said they would vote on a debt ceiling bill next week. is this deal pushing off a bigger issue and how can you play it all to your advantage? liz: because we're a business network. what is the trade. a guy who believes he knows. larry mcdonnell, new edge director. we can not control the people in washington. we certainly can anticipate what they might do and trade off it. the debt ceiling, first of all, how big of a deal would it be to the markets in general? >> if they extended it 45 days, it would be relief. everybody is expecting march 1st problem. around december 10th looked like the president would meet the speaker.
4:34 pm
markets, beautiful rally from the december 10th to the 18th the markets rallied beautifully. from the 18th to the end of the markets dropped 4%, 4% from december 18th to the end of the year because all the good things we thought were happening behind the scenes fell apart. david: let me challenge you on that though. some people say they want to lock in the lower capital-gains tax rate at the old tax rates. therefore they were just taking their profits off the table? >> the market thought that they were going to meet in the middle in terms of the president actually giving in towards spending cuts. he pulled back on the spending cuts hardcore. i think here, looks like gop, looks like the gop will extend the debt ceiling another 45 days. that is why the market was up yesterday. the market is way ahead of this. but, i think that next week, next, two, three weeks there is still a lot has to be done to get this thing completed. first of all, has to get through the house and the senate. there will be a ton of volatility between now and when this finally happens. liz: how do you trade it,
4:35 pm
larry? >> well the vix, last time i was on shot --. liz: very low. >> now below 14. you can do call spreads on the vix. i like to be long volatility here. think about the end of february, it is fascinating, because you have this italian election and berlusconi is pulling out all the stops. it is monte, you will see leftist movement in italy. liz: let me sort of keep it clear here. >> sure. liz: if you go long volatility that must mean you believe it will go higher, correct? >> correct. liz: because of an italian election? >> well a combination at end of the february you will have the italian election. you will have the debt ceiling potential deal. liz: hence worries will cause volume at this time to go higher. >> sequester and continuing resolution. you have all this political risk. if you think about the last two, three years, liz, the bottom line, people outperformed, people that generated alpha, bought during periods of political fear. the people that added to the market, added to their
4:36 pm
exposure to the market during times of complacency typically underperformed. you want to save that powder for those political fear moments. david: save your cash until the debt ceiling thing collapses. maybe three months. want to focus on europe. spain and italy have $2.6 trillion worth of bonds outstanding. 2.6 trillion. they have got to borrow more, about 150 billion, in order to pay off old debts with old bonds. how will they do it. what happens if there is no buyers? >> look at spain. look at lehman. there is so many great comparisons because, --. david: that is not a good thing for spain. >> well, you look back to 2008. the fed bailed out bear stearns. lehman could have sold itself to the creative development bank. instead they pulled back the fed was opening up all the amazing windows. primary dealer credit facility. for people at home, bottom line the fed was giving lehman all this new liquidity. so they didn't have to sell. liz: would you short spanish
4:37 pm
bonds? >> i would short spanish bonds here. end of the first quarter and next 90 days spain is the big risk point i think for the u.s. if spain can't fund itself, they have to sell 150 billion of bond. plus their three biggest banks have to sell about $140 billion worth of bond in the next year-and-a-half, two years. david: the good news is from larry mcdonald bad news is coming? short until then, when bad news comes everybody runs for the exits that's when you put your money in? >> absolutely. play the market long. get ready for volatility in 2011 and 2012. we had dramatic mid-year selloffs european induced. david: great to see you, larry. love the coat. liz: long the vix. did you listen to him back in 2008 when he said investors should take advantage the opportunity of a lifetime? if you did, you scored big.
4:38 pm
he said at the low point to buy. look what happened. went all the way up. he is here today. he said we're on the edge of a second buy of a lifetime. find out why and how you can cash in. david: charlie gasparino joining us fresh off his sit-down with the chairman and ceo of morgan stanley, jim gorman, about the strength of his company which was up almost 8% today. if the big banks should be broken up like the dallas fed chair wants. ♪ .
4:39 pm
4:40 pm
david: time for your fox business brief. a mixed day on wall street today but all three major indices are higher for the week. at the closing bell the dow was up 53 points to 13,649. one ceo who can't complain about his paycheck last year is goldman sachs ceo lloyd blankfein. the banking giant boosted blankfein's stock bonus in
4:41 pm
2012 by 90% very sus a year earlier to a total of $13.3 million. congrats. that wasn't even the biggest goldman payout. vice chairman michael sherwood was awarded $15.4 million. taking out more money than you need at atm will be a thing of the past for some customers. chase and pnc banks are outfitting thousands of atms nationwide end of the year with one and five dollar denominations. that is the very latest from the fox business network, giving you the power to prosper. have a great weekend. ♪ [ male announcer ] how do you make 70,000 trades a second... ♪ reach one customer at a time? ♪ or help doctors turn billions of bytes of shared information... ♪ into a fifth anniversary of remission? ♪ whatever your business challenge,
4:42 pm
dell has the technology and services to help you solve it. david: shares of morgan stanley shot up today and our own charlie gasparino had a chance to sit down with the company's chairman and ceo jim gorman. coincidence? i don't think so. liz: is this a pivot point for the company? charlie gasparino had so many interesting questions, i was sitting there totally riveted. >> it was good. james, tv didn't come
4:43 pm
natural to james. i known him for years. he used to be a mckenzie consultant for brokerage department of merrill lynch. that's where i first met him. took over merrill lynch brokerage department. became a senior executives at merrill. then left. became senior executive at morgan stanley to run its brokeage department and became ceo essentially appointed by the board. favored by john mack, his predecessor, long time morgan stanley ceo. he has gotten good on tv i asked him a lot of tough questions. one question in particular had nothing to do with earnings, about what he thought breaking up the banks. big issue. here is what he had to say. >> i don't subscribing that to at all. may suit small interest of ourselves and others versus big commercial banks. i think it is flawed lodgic. the biggest banks in the world are not u.s. banks. chinese, japanese, swiss banks. there are big banks in australia. >> why do we need big banks in the u.s. that are system
4:44 pm
systemic important, systematically risky? do we need them. >> percentage of gdp, compared to the major industrialized countries in the world are smaller. okay. >> they're less systematically important to our economy than switzerland, france, canada, australia, china, japan, you go down the list. global corporations companies like ge they need balance sheets the size of what our major banks have in order to support their businesses globally. >> you guys, you don't, why wouldn't they just do all their business with jpmorgan instead of morgan stanley? >> there are range of businesses. i were correspondence banking, commercial finance, commercial lending there is whole range -- >> you think they could survive even if they don't break them up? >> our surviveability is not issue. question how much we'll thrive and how soon. think market's response today reflects that. in defense of our competitors, and there's a bit of a push now about this whole break you banks i
4:45 pm
think it is dead wrong. >> do you think they will actually do it? >> i pray and hope we don't do it. >> i didn't ask what you pray. do you think congress would take off. >> i don't think. >> that shed headline. you think this is noise. >> they will take up debate. reasonable people will get through and debates of series of these things last few years that will recognize it is an essential element of american competitiveness and there is actually no industrial lodgic for it. >> kind of interesting. richard fisher --. david: he was on yesterday, saying his plan. by the way let me ask about that. fisher was asking specifically, he thinks not breaking up the banks necessarily but denying anything but the commercial banks open windows from the federal reserve. cutting off the pipeline for the financials. >> that would be a free market way to break up the banks. just dawned to me i should have asked this question. sometimes this happens. does he want to merge with a bank? david: good question. >> being big like that with
4:46 pm
jpmorgan --. liz: depositer bank. david: commercial bank. >> jpmorgan has a big competitive advantage if they tap in, with all the banks. more than chase. they have chemical. they have a lot of stuff, jpmorgan chase. they can borrow some of that money and use it to fund projects to entice m&a clients. kind of an interesting thing. shares of morgan stanley are up right now, way up. shares of facebook are up. remember they were the underwriter on facebook. took a lot of heat on the botched ipo not for botching it. that was nasdaq's fault. he gave me interesting commentary how he and greifeld are kind of kind of sort of made up. liz: they had a discussion. that's what he said. >> that was funny. they took a lot of heat, morgan stanley did, following the rules they gave insight and analysis about facebook's problems, financial problems to only institutional investors and not the retail vest, to. they followed the letter of the law. he gave me kind of interesting quote. we should put it up on the screen so i do it justice here. assume a lot of investors
4:47 pm
decided not to go into the stock on account of that last minute advice. one analysts out of 17 had this sort of precautionary tale and the stock went up. how is that for doing the right thing by helping them miss out on a opportunity? liz: you will never know. >> his point is this. the reason why they put in the rule you don't talk to the retail, you, we don't want you pre-ipo advice. a lot of time what banks would do to pump, hype the stock to retail. and, you know, and i don't agree with it. i don't agree with his rationale. i think all things being equal, give everybody the same advice. the problem was in the old days, yes they used to hype to retail but still gave the sort of best advice to the institution. liz: rich guys. >> that's it. i'll tell you, jim gorman is a good guy. he came in. he faced all the questions. did it with a smile on his face. he did a good job. as you can see from interview. interview is on foxbusiness.com. it was a tough interview. he came in here and answered every single question.
4:48 pm
liz: good for him and for you. david: good stuff. thank you, charlie gasparino. liz: up next the bond king is back with us. he back with us. and the second buy of a lifetime is coming and coming this year. he was dead right when he predicted the first opportunity last time around. you can't afford to miss this segment. it's a new day.
4:49 pm
if your a man with low testosterone, you should know that axiron is here. the only underarm treatment for low t. that's right, the o you apply to the underarm. axiron is not for use in women or anyone younger than 18. axiron can transfer to others through direct contact. women, especially those who are or who may become pregnant, and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. report these signs and symptoms to your doctor if they occur. tell your doctor about all medical conditions and medications. do not use if you have prostate or breast cancer. serious side effects could include increased risk of prostate cancer; worsening prostate symptoms; decreased sperm count; ankle, feet, or body swelling; enlarged or painful breasts; problems breathing while sleeping; and blood clots in the legs. common side effects include skin redness or irritation where applied, increased red blood cell count,
4:50 pm
headache, diarrhea, vomiting, and increase in psa. see your doctor, and for a 30-day free trial, go to axiron.com.
4:51 pm
4:52 pm
liz: he correctly called the bottom of the stock market. in fact, in certain cases it was the true bottom. 2008, november, and if you had listened to him then, your investments would have doubled. now, he is here with another call. better listen up. he is the company president. from quebec. good to see you. >> nice to be back. liz: you were here in november of 2008. you said watch out. we already had the bubble burst in the housing market, the stock market, as it burst, you should get in there and buy. >> that's right. liz: all we have to do is look at the chart from back
4:53 pm
then. you see a straight moon shot. >> i've been, i was sitting down with money managers and professionals and finance, they stared at me when i said, this is it. you should be buying. we have the buy of a lifetime. people were staring and not understanding but the market is really discounting mechanism. that's what it is. liz: now what's your call? we proud you in because you say there is a second buy of a lifetime this time. >> the interesting thing i think i'm able to call the second buy of a lifetime because i called the very first buy of a lifetime. and, that is hard act to follow, but i do believe that now stocks will offer us in 2013 somewhere in the next couple of months, maybe a mild pullback. this will be the second buy of a lifetime. i am expecting stocks to actually double again. liz: wait for the, a little bit of a selloff and then go in but where? you have two baskets of stocks. i want everybody to listen because we'll put them up on the screen of the first one
4:54 pm
ticker symbol caf that is of course a basket of chinese stocks. >> now most people make the mistake of buying hong kong stock. i actually give this idea because you're actually buying real chinese stocks from the shanghai market and you also have access to some stocks that you would not be able to. i think the chinese story is fantastic story. liz: the names, top holdings for example, are on the screen right now. >> then again people that follow my work know that in 2007 i did call the chinese market to crash and it crashed 50%. and this is public stuff, if you google my work. and this is the first time for the last couple of weeks that i have actually turned bullish on the chinese market. since 2007. liz: they just got, for example, the china gdp for 2012 came in 7.9%. 10 basis points better than expected. >> exactly. liz: next pick is spy. that is spdr for the s&p 500. >> yes. liz: basket of these names. >> over the years people have the sense they have the
4:55 pm
knowledge to pick stocks and i completely disagree with this. my view of the coming market and where the market will be doubling i think the leadership is going to be very narrow. people have to listen again to what i'm trying to say. leadership will be narrow. people can not pick themselves those winners. and i they will be extremely difficult to do that. the best answer, buy the basket. and you will be sure, at least, to make as much as the market is doing. liz: good to see you. >> thank you. liz: he is the president, great to see you. heading back to quebec. please come again. >> thank you. liz: thank you very much. next week, david you need to watch what is said out in davos, switzerland at the world economic forum where leaders from around the world will be gathering for the forum. political leaders. business leaders. academics, pretty much the people who shape agendas thinking in business. david: who, who? give us specific. >> here i go! flying over to davos which is tiny alpine
4:56 pm
village. i will not go into the single prop. bill gates will be joining us. bill gates of bill and melinda gates foundation. along with mike car kent, coca-cola chairman and ceo. this is from last year. we were talking about big thinking last year. carlos ghosn, nissan motor chairman. those are the gloves. we gave fox business gloves and coca-cola gloves. there is carlos ghosn. david: we have coca-cola gloves? i don't understand. liz: i didn't get a pair. bain & company chairwoman. arne sorenson, marriott international ceo. these are some of the people. no, that mountain is not photo shopped. david: what else will you be doing? liz: everything. david: everything? liz: we have so many guests. we have more than 30 guests. davos switzerland, the world economic forum where people come and big news is made and all the leaders will be
4:57 pm
speaking with fox business. join us. coverage begins on wednesday. david: meanwhile we have a lot happening next week. there is of course on monday is the inauguration of the president. we'll cover it here with our own neil cavuto. he has full coverage what is happening. for the rest of the week, the question is the deficit talks. are they going to lead to something? will they accept a temporary deal or not? will the market have this pullback that everybody, this hour has been talking about. people are waiting for it. a lot of people have cash. they have been keeping the powder dry, waiting for a pullback to go into the market. we may get clues whether that will happen coming up next week. liz: the team will be here for you on fox business, watching. remember what we've seen. five-year highs. watch out for ample next week and so much more. david: you know who is now? liz: "money" with melissa francis. david: we'll watch, melissa. liz: i'm hopping a plane. see you in davos. i need to rethink the core of my portfolio. what i really need is sleep. introducing the ishares core,
4:58 pm
building blocks for the heart of your portfolio. find out why 9 out of 10 large professional investors choose ishares for their etfs. ishares by blackrock. call 1-800-ishares for a prospectus which includes investment objectives, risks, charges and expenses. read and consider it carefully before investing. risk includes possible loss of principal.
4:59 pm

93 Views

info Stream Only

Uploaded by TV Archive on