tv Bulls and Bears FOX News January 23, 2010 10:00am-10:30am EST
>> see you tomorrow. >> scott brown wins and president obama responds. but attacking wall street? look at the results. stocks diving as the president announces one of the biggest clampdowns banks have seen since the great depression. other democrats appear to be getting the message from massachusetts and now they're pushing this president to extended bush tax cuts for everyone. is that the right message to get stocks and jobs back? i'm brenda and this is bulls & bears. >> the bulls & bears this week, gary smith, tobin smith, pat dorsy,arian bowling and julia. >> gary, what a difference a week makes. democrats are pushing to extended tax cuts, is that the right push? >> absolutely. there's some sanity starting to creep into the democratic party
as a whole. at least congress, maybe it will creep into the obama mission but look at the history. tax cuts work for crying out loud. it got us out of a horrible, horrible recession prior to the great depression but by the way, when we raise taxes and that kept us in but 1920,-1921, it worked for kennedy in the go-go '60. the top ten states that cut taxes the most double the top ten that raised taxes the most. when it comes to julia, give me a time tax cuts don't work. >> all right, julia. >> look, these taxes, the bush taxes, are part of what got us into the problem we're in now. >> what? >> we need to not cut taxes for the wealthiest people in the
country. they can pay their fair share. they were paying before and no reason they can't pay now and use that money to create jobs. >> so tax cuts don't work, toby. >> so julia, about 60% of americans pays zero federal tax, 49% pay zero, the other 11% pay less than $100. so 40% of the people pay all of the taxes but of that, 5% of americans, those quote/unquote rich people that can do it on their own are paying more than the 95% con bind. if we took all of their income, the top 5%, it would only raise another trillion dollars so i don't think your math works. second of all we don't have the stones to do it but a two-year moratorium on capital
investment. manage how many jobs could be create if for 24 months you invest capital in in bus businesses but no we talk about small things and say the rich aren't paying their fair share. a bunch of bull. >> absolutely not. we use the money raised by subsidizing tax cuts to funded president's jobs bill. >> julia we had nearly a trillion dollars set aside for the jobs bill. >> $230,000 in jobs? >> no, 413. >> please. >> all the taxes -- $413,693 per job. recovery..gov's necessary. those are them. unfortunately. >> we need to let these tax -- >> we need to let this tax cut --
>> these jobs don't last long. by the way -- >> the bush tax cuts were not successful. >> how can you say -- >> why, because we're in a recession that started during the bush era because he took the time to -- >> wait a minute, wait a minute. >> time out. >> we're playing -- >> we did have an internet bubble that exploded, a housing bubble. i don't think the tax cuts hadding it to do with that. pat, what do you think about extending the bush tax cuts? >> they didn't help. >> well, my general view is neither fiscal nor tax policy does much in to help or hurt. it is too big. you have assets like the internet bubble, credit bubble and crisis in confidence and i don't think it's going to get unemployment down from 10 to 6 faster or slower.
the only medicine is patience. when businesses have the confidence to invest they will do so. unfortunately that takes time. politicians don't like to be patient so they talk about this stuff. all we can do is wait. >> gary, by not extending the tax cuts, you're going to be doing a tax hike. what would do to the jobs? >> it would kill jobs. i don't agree with pat and i don't agree with jewel y people make investment decisions based on a future stream of income. that's why tax rebates don't work. it's a one-time thing but if you're thinking in the future, taking out a mortgage, buying a bigger car, how much income am i going to have not tomorrow but six months down the line, 12 months down the line. that's why tax cuts work and you take that money and buy a new car.
then the car makers have to make more cars and in order to do that they hire more people. it's basic economics. when the government spends, they don't spend it efficiently. they don't spend it effectively. we're at the cost of what, $400,000 per job created. those jobs, by the way, will go away. >> you know where they're going to go? overseas. if the tax structure here on a corporate, individual level, gets too high there are other -- >> all of them will go overseas. >> plenty of countries would like to have our workers. i would look at singapore or overseas. >> we started talking about the fact dems said this is not a bad idea. that has to speak to sort of a revisiting of the whole sort of to the totalitarian.
>> the with use peeking. >> not only massachusetts would elect republicans but doing a tax cut in the middle of a recession -- >> what do you think of that julia, this is coming from your party. >> you know, there -- we allow manydy vergencies but the reality is the tax cuts didn't work and to gary's points about rebates, bush tried rebates too. >> i agreed with you. >> that was julia's version of how not to answer a question. he asked what do you think about the liberal dems moving towards the center or even to the right side of the aisle. >> just because they're suggesting it, they're not saying let's jump onboard and importance a bill. the majority of the democrats distant want these taxes in the first place. they were opposed to the bush tax cuts because of the problem
they've gotten us into now. how they're not -- >> the tax cuts got us into the problem now? >> it's part of the problem, absolutely part of the problem. >> my gosh. >> you're last, gary is the last word. >> the last laugh. >> yes he does. just about everyone thinks scott brown's shocking win means that trillion dollars healthcare bill is done. not so fast what, neil's gang just found out. first a white house push to protect your retirement savings by giving the government some of your 401(k). is this about protecting you or their spending binge. who need
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i'm jamie colby. haiti had to call off the search for survivors. u.n. officials say at this point they'll act only when they hear sounds of life. the humanitarian effort ramps up. a star-studded telethon last night raise money for haiti. ♪ [ music ] >> christina ago layer one of dozens of celebrities to perform. if you would like to support the relief effort text haiti to this
number. $10 goes to the disaster relief or go to foxnews.com help hate haiti. >> the white house wants to protect your retirement money. how? by telling you to put more of your 401(k) in safer investments like government bonds but he says this is no protection plan for you. >> safer. first off this is an incredibly sly, astute money grab. if you were to force people with the 2 1/2 trillion dollar or $4 trillion in 401(k) to put 25% in bonds that money would be there forever, buying at the most expensive price. then when you go to cash the bonds out it's an annuity. you locked yourself in extremely low yields and you've locked yourself in for life. and boomers will live to 80. if you made it to 60, you signed
on for poverty. >> gary, the concept is if washington is on a huge spending spree to print money, it's got to have somebody buying that up. that's what it's trying to do with the 401(k), isn't it? absolutely. this is a way to dig further. we talk about taxes in the first segment. this is a way for people under the guise, as toby said, of a safe, nifty way too far the u.s. consumer, if you will, purchase more debt. the other problem that toby didn't point out, we don't even know if this investment keeps up inflation. you might be investing at these what, 2%, 3% return and inflation eats your gains and principle. this is the same stupid idea brought to you by people who given a us social security, medicare, all these other great solvent ideas that we have.
>> julia, what do you think of this? >> this idea is brought to you by the people who actually have this as an option. the federal government employee plan offers a couple types of investment. this is one of them. >> so do other 401(k) plans. >> it's an option. that's what we're talking about. why not allow people the option to have a less risky investment if they're not market savvy. this helps save them money. people who cash out 401(k)'s in march cashed out at $20,000 less. >> but if they kept them to december, they were back to even. and eric, talk about less risky. in times of inflation, you talk about bonds. >> they're trying to sell the american taxpayer on the load they sold the chinese government. but here's what they want us to
take advice from, they put $180 billion behind aig, gm and chrysler 83 billion dollars. a goose egg and fannie and freddie combined. $110 billion, worth about 3 billion combined, to $6 billion out, about 99% of our taxpayer money is got. kaput, evaporated. >> pat is, this advice that you would offer to your family? >> well, what's unfortunate is it's investing the way far too many people invest which is turning the clock back ten years and saying what do i wish i had done and do it today. bonds have eaten stocks and they say i should be in safer investments. ten years ago stocks had 40 times the earnings, treasury 6%. now stocks are 20 times the earning, half the val valuation
valuation -- >> put some gold in the portfolio. >> back to the concept that the government is spending a lot of money. we have a big spending spree going on here, right gary b? >> absolutely. >> it has to be financed somehow. >> right, instead of the government stepping up to the plate and doing something -- they should have done it under bush and certainly under obama. rein in the spending. the department of education, cut that out. you don't need those billions of dollars spent. start to balance the budge like the states have to do. you wouldn't need to subtly go to u.s. citizens and say please buy our bonds. >> gary, remember, when in trouble, go to the dumb money. obviously they figured the americans are dumb and we could tear our hard-earned money in our 401(k) and buy 2%.
>> julia? >> americans are smart and they don't feel like they can take on a lot of risk now and i don't see why everyone is opposed to the option of people being able to. we're not saying that everyone should run into this but why not an option. >> the bill they're talking about forces to you buy bonds at the most expensive time. >> in you can have the option to shoot yourself in the head too, that doesn't mean it's a good idea. >> all right, pat. last word for you. >> all right. fund aid to haiti by taxing our workers' bonuses? wait until you hear who is asking the president to do that and why somebody here says it's a good idea.
americans reaching into their pockets to send aid to haiti. 170 million-dollar from the u.s. government and 100 million from corporate america. tens of millions from private citizens but that's not enough for one professor at colombia university. he wants to tax wall street bonuses to fund long herm aid. tax for a good cause but is it a good idea? >> brenda, i don't think it is. i'm in favor of the humanitarian aid the united states gifts and all in favor of charity. people give what they want to will personally or a corporation but going after specific industries smacks of the latest populism. why not go after the guys at google or apple or the unions that are flush with money.
maybe about after george champion y he had a great year. when you start to target individual industries, it's absolutely the wrong thing to do. >> wall street's an easy target. >> very easy target. there's $522 billion of unspent money. to -- look, i get it, you don't like wall street bonuses, there's a recession, a lot of people are out of work but you can't tax things you don't like. gary's right, add a cigarette tax for beer tax or speeding tax or pregnant teen tax. you can't do that. stop sending the money we have in -- this is a populous support to use some of the 522 billion wherever it's sitting. >> julia, we get the outrage against the wall street bonuses but is there a connect between doing that and aiding haiti? >> well, we'll have to agree to
disagree on whether or not taxing wall street bonuses is a good idea because i believe it is. i don't see why some of that couldn't go to long term relief for haiti, which people in this country and corporations and the government have been so generous, to 100, $150 million but it's going to take a billion dollars over five years to address this horrible tragedy and where is that money coming from? why not have some of the tax money from this tax go to it. >> wall street bonuses are taxed in the first place. let's get that out and -- does this make sense to you? >> to gary's point, my next door maybe made $10 million as a lobbyist last year. a good place to start if we're taxes success in america. secondly we're -- whenever you do a combined idea, if it's bad
to be a wall street person, who, by the way, make 90s are of their income based on the profit of their business unit, not a bonus. but if the business unit was profitable, they're entitled to 20 to 40% of the profit. talk about that separately from haiti. haiti is the disaster that is the mind blog thing now but there's going on other disasters. we have current disasters we're still working on. combine them both is bad policy and it becomes a success tax that is just detrimental. by the way, people start donating less. the bottom line. >> pat, does this forced charity make sense to you? >> in my view, sending aid to haiti is morley the right thing to do. we have lots of money and they have very little. it costs us little to make a big impact on their reconstruction
but taxing the bank e, i don't think it's a good idea or intelligent move to go after. linking the two basically takes a simple black and white issue and translating it to a complex issue and make that simple. it's not. >> one last point, of course, wall street banks have given millions and millions to the haiti aid issue. >> thanks, guys. and thanks to julia for joining us. we appreciate heavying you. >> the truck that drove the democrats into a tizzy is about to drive up your profits. we'll show you how. why with dog with nine lives could have avoided the need to be rescued and saved taxpayers the cash. everyone awaits the return of the fishing boats. ♪ their safe arrival is highly anticipated, ♪ as is something else. a shipment of natural sea salt from cargill,
predictions. gary b, you're up. >> this tricky environment. you have to pick a sector obama doesn't hate yesterday. so far tax. buy the qqq's and you got a gift last week. up 15% by the end of the week. >> are you a bull or bear on that? >> bear. not cheap enough. while obama has been going amp the banks he has given you a chance to buy. jpmorgan chase is my favorite. 6 or 7 bucks a share. a 10 or 12 multiand it's a lot higher. >> to be y bearish?
>> in the long term he's right but bashing will take it down. >> you saw the dog tape. it reminds me of the invisible fence you can buy at amazon for the cheapest in town. amazon, 125 -- it's about 160 as the numbers come out and a dog, who could -- >> gary b, you're bearish on this. >> well, my dogs go right through that darn invisible fence. i think -- >> eric, your prediction. >> you can buy at 20. >> brown is the new black, scott brown driving his used truck 200,000 miles. he's going to drive it to washington. >> turn it on. >> carmax is the stock symbol. ready? >> we're ready. oh no, come on? >> oh man! >> this is like a -- this is like obama's tax plan. it's dea