tv Markets Now FOX Business January 18, 2013 1:00pm-3:00pm EST
i was ready to make my move. tdd# 1-800-345-2550 all for $8.95 a trade. tdd# 1-800-345-2550 can you believe it? tdd# 1-800-345-2550 i love it when you talk chart patterns. tdd# 1-800-345-2550 trade up to 6 months commission-free tdd# 1-800-345-2550 with a $50,000 deposit. tdd# 1-800-345-2550 call 1-800-284-9850 tdd# 1-800-345-2550 and open an account, tdd# 1-800-345-2550 now with no trade minimums. dennis: the dow is trying to turn positive. cheryl, i do not think we go anywhere until we fix this debt ceiling fight. cheryl: they are coming up with at least a recommendation. i am sure there will be an argument in d.c. ashley and melissa have got you covered. ashley: another argument in d.c., never? melissa: shocking. [ laughter ] we do have breaking news.
learning a vote on the debt ceiling coming as early as next week. the details of the bill and reaction from peter welch straight ahead. ashley: one american remains missing in the u.s. says they will not go she ate hostage swap with terrorists. stephen hadley is our special guest this hour. ashley: energy companies facing off against a formidable opponent. they are losing. ashley: do not mess with the chicken. that is all i will say. especially with the prairie chicken. time for stocks now as we do every 15 minutes. nicole petallides. nicole: we are not to far off the unchanged line. you sneeze and you are in the positive territory. intel has been weighing on the dow jones industrials.
that has been one of the things holding them back. the s&p 500 right around the five year highs but pulling back as well. we have had earnings. you have morgan stanley moving to a 52 week high and seeing profits rising in the future. that was some positive comments there from morgan stanley. it is up 7.7%. that is nothing to sneeze about. a winner. general electric has been a name that has been helping the dow. that is the big picture. as far as looking at the stock market and here we are, i am going to hand it back to you in positive territory. we are up for the week. seven out of nine weeks with gains. ashley: very good. if someone sneezes, it could go negative again.
[ laughter ] melissa: breaking news. extending the debt ceiling to april 15. rich edson is joining us with more. rich: this after a three-day meeting. republicans settled on their first step in the debt ceiling fight. here are the details about what they will vote next week. the increase will be contingent on the senate and house, both passing a budget. republicans say if there is no bill passed, congress does not get paid. all part of the proposal for next week. john boehner say before there is any long-term debt limit increase, a budget should be passed that should cut spending. they have failed to pass a budget for four years. this is a shameful run that needs to end this year. the strategy is to put this off until later this spring to deal with the automatic spending cuts, along with, in march,
government spending does run out. they would focus on a longer-term debt ceiling increase sometime in april or may. that is the strategy from house republicans. president obama says he has not even entertained any type of negotiations. republicans should agree to raise the debt ceiling because having to raise it is the result of appropriations already passed and signed into law. back to you. melissa: thanks so much. ashley: here with reaction to the gop when it peter welch. thank you for joining us. you say, look, republicans are making it an "economic weapon of mass distraction." do they get is a continuation of that? >> it is actually progress for the republican confidence, but it is not progress for the
country. that tack tick is not one that they can hold onto because they know it will plunge this country into a deeper recession. they have been -- it is a way to say they are avoiding. ashley: it really is not addressing the issue, though, what will it take to get that in place. i know that you, of course, have been leading the charge to have the president to prevent the country from defaulting. >> it is not an acceptable option to plunge america into default. the republicans have the power to put us into default. the question is, do they have
the restraint not to. the ryan budget, they wanted us to pass a budget. they did pass a budget in the house. they said it would have to be raised $1.5 trillion in order to accommodate their budget. this is a little bit of doublespeak that is going on. it has to go up. not to give us permission to give us more money. ashley: to get your point, do you seriously think the president may be forced to try to evoke the 14th amendment? >> that is going to be a call for the republicans. the president does not want to do it. he actually does want to negotiate on spending and tax reform. what he does not want to do is have that take place when the republican position on the debt takes the economy hostage. that is off the table. i think the president is smart to be firm and clear on that.
next time it would be democrats if we had a republican president. ashley: would you agree, i know it is out of your area, but the senate has not passed a budget in four years now. would you agree with republicans that it is not the way to go and i could, in fact, be breaking the law without i do agree with them. we actually have not passed the budget. i am with them on this concern about our inability to actually do the basic work that a legislature must do. ashley: i know bernanke, timothy geithner, rating agencies and many more states what is the point of a debt ceiling? we routinely raise it anyway. what is the purpose? >> there is no purpose.
the debt ceiling has become a device for fiscal irresponsibility. republicans and democrats both dated. senator obama voted against the debt ceiling increase. if we have this credit downgrade, and we had a credit downgrade, as you know, last august. we have to take this off the table for the good of the country. ashley: some conservatives would say, look, you have to talk about spending cuts. that aside, you would agree, would you not, there needs to be some entitlement reform, we need to cut back on spending. >> i think we do. the big challenge is healthcare. healthcare and the economy is causing much more than it should. that is a big expenditure for the government.
it is a big expenditure for individuals and businesses that provide health care. there is a need to come to terms with the growing cost of healthcare that is beyond our ability to sustain. do we form the payment system? do we make the system more efficient russia mark do we just impose the cost on seniors? ashley: thank you so much for joining us. really appreciate it. >> thank you. melissa: raising forecasts for oil demand this year. the economy revving up in the fourth quarter. phil flynn of price futures group is in the trading pits of the cme for us.
>> the most exciting thing that i heard today was that api report. yes, the man did that to the lowest level in over 16 years. production, the highest level since before the civil war, consider that. up 16%. that is an incredible number. it is really changing the global energy market. there will still be some risk factors going into the weekend. we are a little bit concerned. right now, prices are staying pretty steady. there are a lot of market ahead of this three-day holiday weekend. melissa: i am surprised that that kind of data does not have an impact on price. >> partly, it is because of the
economics. the dollar viewpoint. demand growth in the future. the other issue is that what we will see is the global marketplace, as well, starting to get out into the global marketplace. it will drive up the cost of wti. really, you have to look at this bread. you know, we will see falling prices in europe. lower product prices in the future. melissa: phil flynn, always fantastic. have a great weekend. thank you so much. >> thank you. ashley: the latest developments on the boeing 787. now on the ground in japan wrapping up their initial investigation of the so-called dreamliner. a badly damaged battery and what may have caused warning lights to go off on the flight which forced the aircraft to make an emergency landing. more checks will be done and officials warn it could take more than a week to complete.
the clock ticking for boeing. they would like to get this resolved. melissa: it will take some time. ashley: it is. secrets of the financial crisis revealed. the first limps into the federal reserve banking and action. melissa: the latest out of algeria. offering to trade hostages for terrorists. former national security advisory is here. that is coming up next. we will take a look at metals, as well, as we head out to break there. silver is higher. we will be right back. ♪ [ woman ] if you have the audacity to believe
one america from texas is still unaccounted for at this time. many nations questioning algeria storming of the gas plant. did they take to firm of they can't question -- the state department just said we will not negotiate a hostage swap with terrorist. exact details still remain unclear. leon panetta had this to say in london earlier this morning. >> terrorist should be on notice that they will find no sanctuary, no refuge, not in algeria, not in north africa, not anywhere. melissa: how extensive will the united states involvement the in this situation. joining me now is stephen
hadley. thank you so much for joining us. first of all, what do you make of this situation and what it foreshadows going forward. ashley and i were talking about this during the break. do you see parallels between this and what happened in benghazi? >> there is two things going on here. france is concerned because it does not want to see it's former colony decided. secondly, none of us want and area which is uncovered which can be a space where al qaeda or al qaeda related government, al qaeda related terrorist can plan terrorist attacks. this is a little different. france is in the lead. we have been asked to provide support.
intelligence supports. i think we will and probably should because france is a long-standing ally and because we do not have any interest in ungoverned space where al qaeda groups can plan and organize terrorist attacks. melissa: given what we have heard today, they are holding these hostages, in response they want the u.s. to release the man involved in the bombing. do you think this is a response to malley? >> it was a very bold operation by an organization that is now affiliated with al qaeda, but really has its roots in an opposition to the algerian regime which is now about 20 years old. it was well-planned. people are beginning now to
believe that it was in the planning stage. it was just an excuse and justification by an activity by al qaeda in the islamic area which was really designed to embarrass the algerian government. i think that will probably turn out to be more the case. melissa: venue so that algerian government responding. they beat a disregard for try to get hostages out there. really coming in with a show of force. do you agree with that characterization or do you think that is the way they should have gone? >> we really do not know. we do not have all the facts. these are excruciating difficult decisions. whether the hostages would be moved and once they get to be moved, they are harder to find. they are harder to three. it may be one of the things behind the algerian government
was to act when all the hostages were in one place. these are very difficult decisions that have been made. one of the things that is important is that the u.s. government has reaffirmed that we do not negotiate with terrorists. we do not negotiate for the release of hostages. if you get into that business of negotiating, all you ensure is that you will have more hostages in the future. i think secretary panetta was right. we do not negotiate with terrorists, we do not negotiate for the hostage release, and there will be no place for terrorists to be able to operate. with others, we will try to prevent their operations that could pose a threat to the united states. melissa: stephen hadley, great insight. thank you for coming on. we appreciate your insight. ashley: let's get a check on the
markets. the dow starting to push into positive territory. nicole petallides. nicole: if you like cruise lines or maybe you want to go on a nice vacation, let's talk about these cruise lines. a $19 ipo. it is beyond the expected range of $16 to $18. here it is up 31%. what a great day for norwegian cruise lines. royal caribbean. how about carnival cruise. higher today. royal caribbean polling data. one thing i can tell you, melissa and ashley, both of them had a great 52 weeks. ashley: local, thank you very much. american airlines getting a makeover. a distinctive aaa logo. it is not alcohol anonymous. [ laughter ]
dramatically different local marks the airline's first fleet wide change. it is very patriotic looking. melissa: maybe it is alcoholic anonymous. [ laughter ] ashley: i do not know what i thought that before. melissa: lance armstrong and his history of doping. will the public forgive them? [ laughter ]
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indicted former mayor on corruption charges. included in that indictment are 22 counts of bribery, conspiracy to deprive citizens of honest services, wire fraud and tax return. this returned while in office. he served as a new orleans mayor from 2002 22010. he was mayor during hurricane katrina in 2005. leon panetta that with james cameron to discuss the hostage situation in algeria. a horrific story out of moscow. the artistic director is fighting for his eyesight. an unknown attacker threw acid in his face outside of his moscow apartment. a former dancer has led for two years. he suffered third-degree burns
and doctors are trying to save his eyesight. now back to ashley. ashley: an awful story. breaking news for you. new comments from transportation secretary ray lahood on the boeing investigation. problems with dreamliners appear to be focused indeed on the battery. he says the 787 will not fly until it is 100% sure that they are safe to fly. he is not sure how long that will take. perhaps we note that there is problems with the battery, now hearing from the transportation secretary that appears to be where the problem lies. melissa: lance armstrong came clean to oprah winfrey about doping last night in a prime time interview. dennis kneale is covering this story and he joins us now. dennis: lance armstrong's interview was supposed to be a full confessional.
instead it was filled with indirect confessions, and still more denials. that is why some experts say it will not be nearly enough. armstrong lied for more than a decade about his doping. he viciously attacked any critics ensued so many files that you moscow. last night it was time to come all the way clean. not so much. >> i know the truth. the truth is not what was out there. the truth is not what i said. i did not invent the culture. i did not try to stop the culture. i did not have access to anything else. i am out of the business of calling somebody a liar. but if you ask me if it is true or not, i will tell you if it is true or not. dennis: the truth is not what i said. he sounded like a juvenile the language. everybody was doing it. he did not have access to something that wasn't available to everyone.
that is denial, not confession. liar, liar, pants on fire. the "new york times" saying that once if you book into the camera and say without qualification, i am sorry. a matchup of the lance armstrong debacle and the fake dead girlfriend of the notre dame linebacker. which was more genuine, lance armstrong's apology or manti te'o girlfriend? [ laughter ] melissa: amazing. did oprah come out the big sur and all of this? charles: her ratings depend on her guest. good for her for snagging map.
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look at state street, melissa and ashley. up almost 6%. 53.33. and state street today with this move, what a great two-day chart there, shows you how explosive it is today, hitting a new 52-week high. some of the banks have been doing financially related stocks have done well, hitting 52-week highs, goldman sachs did that. jpmorgan did that. this week. here is a one-year chart. one year, it is up over 20% in 52 weeks. certainly continues to do well. they do plan to cut jobs about 2% of the workforce. that is 630 jobs worldwide. they talk about foreign exchange revenue. and that did post a steep decline. overall certainly a winning day for state street. back to you. melissa: nicole, thanks so much. ashley: the federal reserve releasing transcripts from closed-door policy meetings from 2007. interesting reading at least. it sheds light what they
knew as we headed into recession. peter barnes with more on that. peter. >> ashley, most of them did not know how bad all of this was going to get. that's clear from reading these minutes just released today from five years ago but a couple of fed officials thought it could get really bad. you remember that year, 2007, the subprime mortgage crisis hit. the housing bubble popped. the credit markets got tight and at the fomc meeting on september 18th that year, one new york fed official predicted that the subprime crisis could cost banks 100 billion to $200 billion. we know though that washington eventually ended up investing 245 billion in banks through the tarp bailout. the fed was also forecasting at that time just a 5% drop in housing prices is over two years. but we know now that trillions were lost in housing and stock market values. two fed members at the time were very, very worried about a serious downturn. fed governor janet yellen
saying quote, a big worry that a significant drop in house prices might occur in the context of job losses and this could lead to a vicious spiral of foreclosures, and other bad stuff. cleveland fed president sandra pineault feared potential rapid deterioration in the economy. they were both right. others did not appear as worried and panicked back then. federal reserve chairman ben bernanke and another fed governor, fred mishkin both mentioned the "r" word at that meeting, recession. at that meeting fed members approved a big cut in short-term interest rates. half a percentage point in the fed fund rate and kept cutting regularly after that all the way down to they're. ashley: peter barnes, thank you. how the fed policy was handled as the country tumbled into a economic crisis. jon hilsenrath. you've been pouring over
these minutes. >> can i tell you there is 1566 pages for people to, for peter and myself to go through. there is a lot of documents. ashley: i want to go to page 982. just kidding. what stand out for you. what have you been able to look at so far? >> i tell you what stands out. a lot of history all too well. what stands out is the personalities. this is the best window that we have into how these people were thinking, what they were saying and how they were behaving, at the cusp of this crisis. the personalities come out really interesting ways. ben bernanke, obviously a central figure here. if we see a person who basically transforms over the course of 2007, from someone being completely unaware of the building risk to someone takes on very interventionist role, he really embraced that role reluctantly, comes up time and time begin, not wanting
to bailout banks. not wanting to be a source of a put for financial markets. he was, admitting even december 2007, he says that he was conflicted about taking an aggressive interest rate stance. quite conflicted. janet yellen is another really interesting character peter talked about. yellin, more quickly than most other people i think, grasped that there was a real problem that went beyond housing. yellin comes out as a voice at the fed who figured this out before a lot of other people did and wanted to get the fed moving quickly. the other character who i find real interesting, don't forget janet yellen could be the successor to bernanke at the fed. ashley: right. >> the other real interesting character is tim geithner. the tim geithner was president of the new york fed at the time. he is now the outgoing treasury secretary. he doesn't come out as well as yellin in this. there are times when he looks like a guy who doesn't see the problems that as the new york fed president he is supposed to be uncovering.
i'll give you one example. june 2007. two hedge fund related to bear stearns collapse. geithner talks about them at the june meeting. he says, he thinks that the risk of counterparties to these bear stearns hedge funds is very small. of course within nine months bear stearns has collapsed and the federal reserve bailed it out. ashley: john, that is terrific. we're literally out of time. very quickly, does it give you concerned all the great brains more of them could not see what was coming down the pike? >> it is concerning. there was an element of group think. almost nobody in january 2007 who saw the financial system as being at risk. there was group think going on there. ashley: very good. jon hilsenrath, thank you so much, jon, for summarizing those more than a thousand pages worth of minutes. really appreciate it. >> okay. melissa: will go read that of a the show. start to finish, all weekend. ashley: a fun weekend ahead. research in motion shares climbing on the back of an
upgrade in anticipation of its new blackberry 10. but not all great news. melissa: ever dream of living at 1600 pennsylvania avenue, the new zillow listing for the white house ahead? we can snap it up. put our dollars together and go get it. look at treasurys here as we head out to break. treasury yield slipping slightly, three basis points. we'll be right back.
>> i'm sandra smith with your fox business brief. sony shares are jumping today after the japanese electronics company said it is selling its u.s. headquarters in midtown manhattan to a group of investors for more than a billion dollars. the building on madison avenue opened as the at&t tower back in 1984. pfizer's animal health unit could raise more than $2 billion through its initial public offering. the drugmaker intend to sell more than 86 million shares for as much as $125 each. it sells vaccines and medicines for pets and livestock. consumer sentiment declined for a second straight month in january to the lowest level in more than a year. the preliminary report from the university of michigan showed lingering concern over remaining major fiscal issues like the debt ceiling is weighing on the mind of consumers. that is the latest from the
ashley: research in motion looking to win big with the release of its new blackberry 10. the smart phone being unveiled later this month. and there is news out today that the tech company's stock is getting an upgrade. shibani joshi has details on the rim buzz. shibani. >> the buzz keeps buzzing on this one, you can't really escape it. jeffries today upgrading the stock saying they believe the e-mail and bbm messenger service will be licensed to the iphone as well as to android phones that is licensing revenues for research in motion which it needs. also getting some apps out there and early traction with enterprise customers signing onto this. that is news lifting it higher today, all around up 98%, almost doubled in the last three months. ashley: so are the gains real? this of course has been a favorite of. >> this is interesting.
we're starting to uncover this a little bit. short interest has been tremendous. in the month of december it actually increased 14%, up from 9% in the month of november. what you're seeing are increasing bets that the company's stock is going to fall. but the stock has not fallen. it is actually increased like i said. it doubled in the last three months. what we're seeing are the short traders trying to unwind and get out of the trade. the way they do that, they have to actually buy the stock. so it ends up adding a nice little pop on here. so just a note of caution out there, that there is a lot of pessimism right now on research in motion shares. what is ending up happening that they're making the wrong bets. they're pushing the stock higher and what may be driving the stock is not necessarily fundamentals or news but it is actually the trading positions they're having to reverse themselves. very, have he interesting. ashley: very interesting. so much riding on the blackberry 10. that comes out the end of this month. is there a good buzz on that? >> absolutely. i think i told you guys before. i saw it.
i played with the phones. i talked with ceo and cfo directly in a one-on-one meeting. i was so enthused and they are enthused and getting excitement from institutions and customers out there. this will not be a phone for the masses. this is for enterprise. a very specific customer but will be a bigger segment of the customer than it has. they have a good foot to stand on. ashley: shibani joshi thank you. melissa: all right. it is quarter till. as we do every 15 minutes let's check the markets. nicole petallides on the floor of the new york stock exchange with a big loser for us. >> it is really a big loser indeed. it has been weighing on the dow jones industrials. intel is the biggest loser today. it is down almost 7%. if you are a shareholder you don't want a day like this one if you're long this company. also weighing on techs. it is weighing on tech-heavy nasdaq composite which is down a quarter of a percent. intel is down a buck 57. they came out with quarterly profits that fell. the outlook is weak. pc demand remains weak.
that doesn't help them along. they have been squeezed because of a tough environment. there is a big move into tablets and smartphones and all the competition weighs on intel, this type of company. talk about analyst calls. credit suisse cut the target. piper jaffray raised their target just to name a few. but they do have outperforms and neutrals. outperform came from credit suisse. back to you. melissa: nicole, thanks so much. ashley: washington, d.c. prepping for inauguration weekend. if you want a ultimate experience and don't we all, it will cost you a king's ransom. details are ahead. melissa: playing chicken with the energy industry literally. a new fight to shut down oil and wind production to save the prairie chicken. it is a chicken fight. ♪ .
melissa: so is the prairie chicken versus the wind farm. the environmental battle heating up as the fish and wildlife service contemplates adding the bird to endangered species list. if that means shutting down vital wind farms and oil and gas facilities is it worth it. i understand the main problem is that these prairie chickens are afraid of tall structures because that is where their enemy perches. they're terrified the wind turbines and this is presenting a huge problem? >> well that's correct.
the basically the wind turbines and power lines associated with them can have a footprint that the chickens avoid up to a mile. so there is potential conflict there. now lesser prairie chicken had its habitat diminish over 90%. so it is in real trouble unless we remember the lan and remember the wildlife in our land use and economic development decisions. we have an opportunity now with this pending listings under the endangered species act to design a smart wind energy grid and to place our oil and gas infrastructure intelligently so that wildlife conservation and energy development can coexist. melissa: well, i mean you talk about oil and gas but a lot of the problem are these wind turbines and it sort of pits environmentalists against environmentalists. they say generating wind power creates no emissions. uses virtually no water. you avoid nearly 19 million metric tons of carbon dioxide emissions annually.
why is the prairie chicken more important than either that or the productive energy that is provided by oil and fast? -- gas. >> honestly i think the spin on conflict is overblown. there are 19 wind energy companies actively working with the u.s. fish and wildlife service today on a habitat conservation plan that will do what i said, to place wind energy infrastructure intelligently so that wildlife conservation does not conflict with their economic development activity. melissa: so what does that mean and what would it cost? >> the conservation plan will insure that the participating companies will not be responsible for any additional regulatory burden once the --. melissa: jay, what does that mean and what does it cost? what is behind the words? you want to move it where, what will the cost and who will pay for it? >> the chickens only need habitat strongholds amounts to postage stamps. 25,000 acres apiece. that is less than the footprint of the campus of
disney world in florida. over a five state contrary we're talking about a very small amount of land. not as i have wind you turbines and power lines can not be placed in high wind energy generation potential and drive the chicken extinct. the two simply are not in conflict in the way that is, i hear you saying. melissa: do you know what it would cost to move the existing power structures that you're talking about? >> well, that is exactly the problem is that existing infrastructure is not going to be moved. which is why the endangered species act listing is so important so that future installations are placed telligently. melissa: okay. so sound like we don't know what it will cost but we'll follow up on the story. thanks for coming on. very interesting. >> thank you. ashley: good stuff. battle of the prairie chicken. melissa: that's right. ashley: they only need a postage stamp. melissa: featherses are flying. ashley: they are indeed. they're up cooped up. we could go all day.
home values are rising all over the country including guess where? pennsylvania avenue. according to zillow since president obama and his family moved into the white house the value is increased to $295 million. that is up from 2009 when the estimated value was $176 million. may be able to beat him down to 280 million with a bigger down payment. melissa: wonder what financing. speaking of white house how much will the ultimate inauguration cost? close to $500,000. the inaugural committee is offering a package tickets to a ball. parade plus access to other receptions. the going rate is $250,000 to sit up front for the swearing-in. you have to purchase tickets separately. throw in a presidential hotel suite, food, shopping souvenirs, you could rack up quite a tab. you don't have to spend that much the swearing-in is free and open to the public right here on fox business.
this is where you get neil cavuto. that is priceless. ashley: we gave you a little tease earlier. don't miss neil cavuto. there he is, still smiling. hosting complete coverage of president obama's inauguration on monday, starting 11:00 a.m. eastern right here on fox business. neil will be all over that. house republicans planning to lift the debt limit but with serious conditions. former cbo director douglas holtz-eakin weighing in on the new strategy next with tracy byrnes and myself. don't miss it. ♪
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will it work? former cbo director douglas holtz-eakin is here. tracy: three weeks into 2013 and three weeks up for stocks. we have two hours to go in s&p trading near a five-year high. can it go even higher from here? ashley: california poaching. more states are setting up shop in the golden state trying to lure businesses to move out. one recruiter tells house it all works. fascinating story. tracy: vulture on california companies. ashley: on the down low. they sneak in. tracy: vultures on the down low. time for stocks as we do every 15 minutes. we head down to nicole petallides on the floor of the new york stock exchange. hi, nicole. >> we'll look at the major market averages. the dow jones industrials sitting at 13,599. it is up just three points. that is the kind of day we have had and anticipated we would have not far off the unchanged line. not really moving too far off. but however you have to keep in mind the trend has been
slightly higher, right? we're up seven of nine weeks, assuming we finish here at these levels by the end of the day. the nasdaq composite is pulling back and s&p is flat. i want to get to the vix, the fear index, the fear gauge. what is interesting about the vix, you see it here at 1255, that is not something you follow regularly this is big deal. we call it the fear gauge. it registers volatility and volume and worry in the market and really hasn't been much at all. it is down seven and a half% right now. it is below 13, another big deal there. it continues to fall. looks like 11 sessions in a row. the lowest level since june of 2007. this should tell you, people are taking a breather. i have to tell you, you know they're worried about the debt ceiling. they can't not be worried about the debt ceiling. back to you. tracy: i don't know. that chart doesn't look like it has a pulse. ashley: vix has gone to sleep. talking of the debt limit, we have breaking news.
house republicans, well they have a new battle plan for the fiscal fight. rich edson is live from that republican retreat in williamsburg, virginia, with details. i guess are they retreating a little bit, rich? >> well, i'll tell you if their strategy passes congress, we're going to be doing this again in the next few months talking about the debt ceiling bill. this is bill the republicans plan to vote on next week. this is three-month increase in the debt ceiling contingent on both the senate and house passing a unbillion jet. republican line has been for some time, the senate failed to pass a budget in years, and they say without passing the budget they will not increase the debt ceiling nor, this bill says, will lawmakers get a paycheck. the reaction from the senate majority leader harry reid's office, good that republicans are backing off holding the economy hostage because there are no significant spending cuts in this proposal. just a three-month increase, contingent on the senate passing a budget. in a statement, they say, if the house can pass a clean
debt ceiling increase to avoid default and allow the united states to meet its existing obligations, we will be happy to consider it. so that is the plan right now for republicans. get this debt ceiling debate out of the way for the next three months. focus on government spending, those automatic government spending cuts that are supposed to hit at end of the february known as sequester. all of that starts the spending fight now, republicans say. move onto the debt ceiling to give at least a little bit more certainty or calm economic panic for the next few months, with this debt ceiling fight. and try to extract more spending cuts out of democrats over the next few months. but again it has become clear through this strategy, appears we're going to have these spending and budgeting fight pretty much every few months in washington, as no long-term strategy is yet to emerge. back to you. ashley: you're thrilled by that, rich edson, thanks so much. tracy: poor guy. all right, let's talk more about that. house republicans laying out
their strategy in this debt ceiling fight but will this no budget, no pay thing work to address our physical problems? joining us now, douglas holtz-eakin, president of the american action for rim. rich is talking about we're basically punting the debt ceiling three months. should the republicans drop the debt ceiling fight all together and focus on sequester, continuing resolution? they probably have more room to fight? >> getting it in this order, putting debt ceiling last, other bills first is to their advantage because they're fighting about spending on spending bills. this is ultimately an issue that is about how much debt the united states has and is projected to run up. that is ultimately driven by spending. this has to be a spending debate. and administration and because of the administration, the senate, simply is not engaged. this is a way to force the senate to engage, all right, will you put out a budget that shows enormous debt, or put out a budget that fixes
it somehow? if they put out budget fixes it with taxes, republicans are confident voters will object to that. that will force senate democrats on record about spending cuts to solve the problem and have to get a bill the president will have to engage on as well. the worst case we do this in three months the best case, it starts the real debate the nation needs. ashley: doug, you say the republicans need to understand the difference between a victory and a deal. what exactly do you mean by that? >> well i think it is very difficult for a minority to govern. in the end republicans may be able to get whatever they want out of the house of representatives but they don't get legislation. they don't get something passed by the. >> and signed by the -- signed by the president, if you want a clean deal, that is fine. you may get rhetorical points, but you don't get legislation without being slightly disappointed. we saw that in the fiscal cliff for example. that is bill no one liked because it got done because
everyone gave in the end. republicans need to look at this situation with the same eye. tracy: the thing is, doug, the republican party is so tarnished right now, right? >> yeah. tracy: they can't show up at a meeting. we don't know what they're doing. they have nothing on the table. do we need a new voice maybe? maybe boehner is not the guy. maybe someone like paul ryan to come to the front to be the voice of the gop? >> i think everyone loves the sort of fantasy there will be someone on their side to will so captivate the public that he or she will outshine the president of the united states. it is just not going to happen. the president has an enormous microphone. he has the ability to capture enormous amounts of attention. republicans need to remember on these issues, how much the government spends, and how much it taxes, they have the electorate behind them. the conservatives are united the independents are really fiscally conservative. this is a bloc that controls america and they need to simply find a strategy, i think this is a good one, to have the debate about that
spending issue. ashley: talking about spending, what one issue do you think is one that the republicans should really look in on? is it entitlement reform, health care costs? what is it that they should really zero in on? >> well, in the end the numbers are all driven by entitlements. you can make enormous progress on defense. you can make enormous progress on non-defense discretionary and in the end with you vil a enormous debt problem. unless you take on entitlements you don't solve the problem. in the end voters want you to solve the problem. republicans need to stick to their guns on that front. tracy: i hope they do because we're not talking enough about it. douglas holtz-eakin, thanks for taking time to be with us. >> thank you. >> we're not talking enough about it. ashley: we'll see how it works out. maybe get the debt ceiling dealt with and really get to the heart of the spending cuts that need to be put in place. tracy: we'll be playing groundhog day. ashley: that's true. ask rich edson. saving the best for last, morgan stanley surges after putting a close on this
week's bank results. tracy: georgia, other states are helping offices in california to lure businesses to relocate. it sounds so sneaky. we'll find out what they're doing. let's check out oil is trading as we head out to break. it is pretty much flat. $95.52 a barrel. we'll be right back [ male announcer ] this is joe woods' first day of work. and his new boss told him twongs -- cook what you love, and save your money. joe doesn't know it yet, but he'll wk his way up from busser to waiter to chef before opening a restaurant specializing in fish and me from the great northwest. he'll start investing early, he'll find some good people to help guide him, nd he'll set money aside from his first day of work
tracy: it is time to make some money with charles payne. this hour he has a stock from the industrial metals and hundred rals sector. charles? >> otherwise known as coal. tracy: not your risky bet thaw generally come with. >> seems a big anchor woman now. now using all the big words. tracy i knew two years ago, what is up with the coal stocks? industrial --. okay. tracy: i know what i'm talking about. >> i'm talking guys, about
metallurgical coal. tracy: that is fancy anchor term too by the way. ashley: thermal coal. >> this is thermal coal. the thing driving this thing, it is interesting, by the way this is high-risk idea, let me throw it out there. arch coal is one of these companies that is barely making it in part because of coal production, you know, usage is way down. it would help if we occasionally had a winter. tracy: bite your tongue. >> would help them if we had a winter. of course all these regulations. i think they can survive. we had coal exports last year were a record. up 100% from 2007. that will help them out a whole lot. some domestic demand will help them. what i looked at some of the contracts they have already gotten so far for this year, most of them are higher than last year. if you get a little bit of pricing power in there, the thing that struck me and reason i brought it up the volume is really compelling. i don't think people have to go out to buy the stock at the very moment. one of these you should put on the watch list.
ashley: what price level are you looking at? >> from technical point of view the stock breaks out around eight bucks. ashley: so, 7.66 right now. >> we have a little bit of room. have room to 10, $11, maybe 12. doesn't sound like a lot but double-digit percentage gains. this used to be a hot stock. was unstopable like all the other coal stocks. with nat-gas taking away market share, nat-gas prices i don't think will go much lower. they will stop getting it, natural gas they're not going to make money. we have something of a floor in nat-gas. you have overseas demand. again a little nippy outside. it is anecdotal. we'll go with it. this is one, above 8, this kind of volume continues we may pull a trigger on it for a trade. i will also say i think it is a high-risk. ashley: all right. tracy: the administration is not into the coal industry at all. >> at all. tracy: been killing it. >> that is minor understatement or major understatement. tracy: thank you, charles. ashley: talking of winter. it is mid-january so of
course you expect to see snow, not in new york city. how about alabama? tracy: no. ashley: a winter storm hitting parts of the southeast including virginia, mississippi and alabama. they don't know what to do with it. icy roads. several inches in some parts closing schools and businesses across the region today. thousands are without power. some areas digging out from up to a foot of snow. tracy: no way!. ashley: the storm is responsible for at least one death. when you see snow in alabama and mississippi, you know something is not right. tracy: they don't have snow tires. ashley: they don't know what they are. tracy: no. ashley: snow tires, what's that? tracy: i feel bad. all right. the dow is just, god, plugging along here, up eight points. so we have to check on the markets. nicole petallides on the floor of the stock exchange. you have big names moving on earnings, don't you? >> i sure do. the markets are not too far off the unchanged lined there are trend we're seeing, there are story stocks happening an certainly earnings. look at two names on the
move. first is intel. off the earlier lows of the day but down so significantly, down 6.7% per intel. they come in, see their profits sink, the revenue numbers are missing. not good news there, a weak outlook. pc demand has been weak weak, competition is intense. still you have a very fragile economy. that is weighing heavily on dow jones industrials. look at morgan stanley. different picture. get ready for green arrows, right? surging new 52-week highs. it is up 7 1/2%. great numbers from morgan stanley. you can see that is a winner though the banking index still remains to the downside but morgan stanley is a clear winner. back to you. tracy: sure is. good way to end the week. nicole, see you in 15 minutes. ashley: keep it right here on fox business. charlie gasparino sitting down with morgan stanley ceo james gorman. that is next hour on "countdown to the closing bell". do not miss that. tracy: no, no, no. all right. china says its economy surged last quarter.
one expert isn't buying it. i'm not only skeptical sicilian here. he will tell us why. ashley: don't believe a word they tell you. first how is the dollar moving right now with the dow kind of drifting along? as you can see all of the currencies down again the dollar. the dollar is up across the board. we'll be right back? [ woman ] if you have the audacity to believe your financial advisor should focus on your long-term goals, not their short-term agenda. [ woman ] if you have the nerve to believe that cookie cutters should be for cookies, not your investment strategy. if you believe in the sheer brilliance of a simple explanation. [ male announcer ] join the nearly 7 million investors who think like you do: face time and think time make a difference. join us. [ male announcer ] at edward jones,
ashley: china says its economic growth accelerated for the first time in two years with a nearly 8% gdp in the fourth quarter. sounds great, doesn't it? but my next guest says those numbers don't always tell the whole story. leland miller, managing director at avasent international. he does a quarterly survey on china modeled after the fed's beige book. thanks so much for being here. that brings up a key question how do we trust any of the economic data that comes out of china? how do you sort through all that? >> there are data points you follow. our solution is to do it ourselves. china beige book is all independent data. we break the economy into sectors and regions and track the data every quarter ourselves to verify. tracy: how do you gather it? some companies don't even have audited financial statements and can't believe
numbers coming out of individual companies. >> exactly. we don't use middlemen. we go in ourselves. interview over 2,000 firms. tracy: you literally go to china on the ground? >> we have operations all over in china. we have quantitative surveys. we have banker surveys and we interview bankers separately. we have qualitative surveys and do interviews with
surface. ashley: china is such always such an export driven economy although they tried to address that and increase domestic demand. has that happened? >> yeah. i mean we looked at retail. retail is a pretty good proxy for consumer demand but it is not a perfect one. so what we've seen is increasing retail sector growth. that's great but in order for the economy to rebalance it is not just consumption growing. it is the share of consumption versus investment growing. it means the chinese government needs to stop dumping enormous amounts of investment dollars into infrastructure around the country. unless that falls, they can have as much consumption they want and won't change the share of consumption versus investment.
tracy: they're cutting interest rates and dumping short-term cash into the system. they could arguably end up like us. >> or far worse. the idea you have to have demand. you can play around with the economics of this you can make cheap money and do other things. if you don't ultimately have demand then you won't have an economy that works. this is what china's big problem is right now. seeing a lot of growth numbers looking pretty good. people are back on the bull train. china is looking good. seeing yellow lights like rising inventories, nonproductive, and see loan demand falling. these are signals something bad might be going on underneath the surface. ashley: amazing. china has a labor force of 937 million. i can't get my head around that but are there enough decent paying jobs for that labor force to be employed? >> this is why rebalancing is so important. if you have an economy focused on manufacturing and keeping low margin industries in business, then you're not. but if you push towards a
rebalanced economy sectorly speaking and you have more jobs and services, more jobs in retail, more higher paying jobs throughout the economy you will have more opportunities for people to make more money and quality of life to improve. that is the challenge of the chinese economy right now. tracy: they need demand along with it. right now they don't individual. good stuff. ashley: leland, thanks for being here. we appreciate it. >> that was terrific. the s&p 500 is up 13% in the past year. so, how do investors watching the market from the sidelines totally missed their chance? or is there time to cash in on this rally? sandra smith is taking a closer look in today's trade. >> i'm looking at all kinds of stuff. this is really fun. a lot of people are looking at the fact they maybe didn't jump in at beginning of the year. they missed a rally at end of 2012. this is rally going back to 2009. if you're a long-term buy and hold investor and not in this market as much as you might want to be, it may not be too late. the folks at jk investment group, they're basis say
basically saying pes are low in the s&p 500 and dividends are high. we went into a stock screener of potential stocks you could be looking at to benefit from this very cheap stock environment and some dow components showed up in the mix. 3m popped up by the way. also boeing, despite all bad news out there. i will shorten this to a year-to-date chart to see what these stocks have done so far this year. very volatile environment for many of them. apple fell into the category. let me remind everybody what i did here. i looked for dividend yields over 2%, had to have a market cap of at least a billion dollars and pe below 15. so really strict requirements on these stocks. these are the ones that met it. insurer also in the mix, allstate which has been rallying so far this year. technology company, dell, which is also been on the rise and has some momentum if you want to consider jumping in on dell shares. dupont, another dow component and as those oil prices continue to rally near the triple digit level, look who fell into the mix,
exxon. one of the big leaders in the dow so far in 2013. it has got a lot of momentum above $90 a share. and ford motor company, guys. it is in there as well. by the way stocks towards the bottom of this list. their dividend yields are above 3%. they're way beating the rest of the market. these are definitely some stocks you can consider as you look at the s&p 500 in this rally we've gotten so far, in 2013, 2013, not so bad, guys. we had the dip there in the latter part of the year and some of these stocks are just cheap right now. so don't think you missed the rally. it is never too late. back to you guys. tracy: for sure. sandra smith. thank you very much. ashley: sandra, thank you very much. we have breaking news for you. the white house releasing a statement on the house republican plan to lift the debt ceiling for three months and then link additional increases to the senate, passing a budget. the white house says, quote, the president has made clear congress has only two options, pay the bills they have racked up, or fail to
do so and put our nation into default. we are encouraged that there are signs that congressional republicans may be backing off their insistence on holding our economy hostage to extract drastic cuts in medicare, education and programs middle class families depend on. congress must pay its bills and pass a clean debt limit increase without further delay. he has said, the president remains committed to further reducing the deficit in a balanced way. so that is the response from the white house after the gop at its retreat in virginia came out with the possibility that perhaps we could extend the debt limit for another three months but the senate has to pass a budget, so the republicans which it has not done in four years. so. tracy: no surprise from the white us house. ashley: says no. tracy: okay, then. how about this. hank paulson says he hates the debt limit. you remember the former treasury secretary, the guy who said i need $700 billion right now?
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nicole: we were getting ready i was talking about the financial. so many of the financials reported this week and you love the financials. the thing to direct the market, what do you think now? speaker is a complete love-hate relationship. i own a lo a lot of stocks and s been lugging them for a long time. i think it is a case you have to live long enough, but i really do think some of them are doing better than others. i tend to focus on the money banks. ge doing their best to try to basically not be a financial, yet it was the financial side of the ledger that drove most of the profits and it is another stock that we own. i think they're on the other side of the mountain. the positive side, not the negative side it just takes time badly the whole sector is the
real connectivity to the overall economy and as far as the financials go so we'll go not only the rest of the economy but also the stock market. nicole: what do you think about the economy and overall the market? you sound somewhat optimistic, what are the main things you as a trader and as american are watching? >> the glass has to be helpful otherwise there's no point getting up in the morning. i think it is two steps forward, one step backward. the direction is clear. the housing market is showing real signs of improvement. that leads unemployment, i don't know how much faster that will get better but i think we are we moving in the right direction in the stock market is reflecting that.
nicole: thank you. cheryl: i like how you said that. a lot of people are stuck holding stocks right now. the federal reserve released the minutes from the 2007 closed-door policy meeting. what did the fed knowing how did they respond with policies heading a financial crisis? peter barnes in washington with more. i guess i did not know how bad it was going to be. peter: that history of underestimate how bad it could get. the fed officials include treasury secretary tim geithner who in 2007 was president of the new york fed. in an emergency conference call he said most firms on wall street appeared to be doing just fine. we have no indication they're facing any funding pressure. in fact, some of them report what we classically seen a contest like this, which is
money is flowing to them. but by december he was much more bearish about the outlook. fed chairman ben bernanke didn't see a major crisis coming, it appears, from these transcripts. he said in december 2007 "i do not expect insolvency or near insolvency among major institutions, but one member sounded the alarm very early was former fed governor fred michigan staying at a september meeting so we may not be able to mention it in public we have to mention the r. word because it is not a significant probability of recession. ben bernanke wrench the possibility of recession but at a time or word about the tight credit market as you recall. the housing bubble has popped that september, the fed kicked off the long march toward near zero interest rates with a half a point cut in the fed funds rate. tracy.
tracy: nobody anticipated this. really scary. ashley: another key figure has a dire warning about america's future. henry paulson speaking with the "wall street journal," gerri willis on the story with interesting comments. >> remember he worked for george w. bush, and looking back on the situation as peter was just reporting on, saying today we face a debt bond and that the explosion will be deafening the way he put it is so predictable it is like flying into a cliff now it is right in front of you. he says will be met more painful than 2008, 2009. nothing we can really tell at this point. he said by the will, and the money to solve this.
it was not like he was controlling cost at all. he said you look at your giving aid to the arsonist. that is how people continue to take it today even getting an accounting lift to banks allow them to write off some of these they have to make on the bases of mortgage debt, so we're still bailing out these banks. couple other things he said the "wall street journal" who only got 30 minutes with the treasury secretary which i thought was interesting. he was asked directly or the banks still too big to fail? he kind of stepped out of that question, but he said the country is in better shape today to fix one of these situations, to bail out one of these banks. but he seemed to acknowledge the
idea that yes, they're still too big to fail, which to me is the crux of the issue. and you were talking before what can you see coming, is it possible to see these problems down the road. remember, set up an agency, federal agency to see down the road and warn us about the next problems. the smartest mind on wall street aren't seeing it. ia bunch of government bureaucrats can do that? speaashley: what you have cominp tonight? >> we have grover norquist to talk about the debt ceiling. we're going to talk a little bit about that. lots more to come. so join us.
tracy: lance armstrong fesses up. what is next for his reputation? and the millions he has earned from being cycling this on remorseful lying champ. there, i have said it. take a look at the 10 and 30-year treasuries as we head out to break. we will be right back. what's next? he's going to apply testosterone to his underarm. axiron, the only underarm treatment for low t, can restore testosterone levels back to normal in most men.
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>> this is your fox business brief. u.s. transportation secretary ray lahood says it is unclear when the boeing 787 will be authorized to resume flying. the faa temporally grounded the 787 after a second instant involving battery failures that caused one of th one of it justn emergency landing. one ceo who can complain about his paycheck last year, goldman sachs ceo lloyd glenn fine. boosting the stock bonus in 2012 by 90% versus a year ago for a whopping total value of $13.3 million. and taking out more money than you need at the atm will soon be a thing of the past for some customers. outfitting thousands with $1.05 denominations. that is the latest from the fox business network giving you the power to prosper.
ashley: lance armstrong admitted two years of doping and cheating during his interview with oprah winfrey last night but did the disgraced cyclist really come clean? dennis. dennis calling for more than a decade he lied and lied and viciously attacked any doubters suing so many that he lost count, so last night the lance armstrong finally come clean? hardly. >> another truth. the truth is and what was out there, it isn't what i said, i didn't invent the culture, but didn't try to stop the culture. i didn't have access to anything else that nobody else did. i'm out of the business of calling somebody a liar. that is not true. dennis: the truth isn't what i said.
instead indirect admissions and still more denials and that is why one veteran image maker said on our noon show armstrong won't win back lanes of dollars in product endorsements. >> i think he punctured the fact he is a disgrace. by lying about the lie it is a big problem. dennis: he started lik are likn unrepentant teenager. everybody was doing it. even blamed his comeback on a jealous teammate. that is denial, not confession and brought attacks on twitter. "new york times" says not once did he look into the camera and say without qualification i am sorry. and invoking the fake dead quarterback of a linebacker. which was more genuine, lance armstrong apologies or manti te'o's girlfriend?
ashley: it is so much, these supposedly role models are killing these kids, the kids don't understand. dennis: have we gone too far? hockey is to let athletes let steroids for years because if you want to do that, go right ahead. at some point we're getting too holy. tracy: he is just a big jerk. there, i have the final word on that. it is a quarter until, stocks, heading down to nicole petallides on the floor of the new york stock exchange. you have boys, what do you think about this whole thing? >> this is not good for the kids at all.
i want to talk about rim. i'm following the motion of the blackberry maker, see the stock up 6%, the last time jeffries had a buy rating was almost two years ago. in april of 2011. they're back to the buy rating. have a new price target of 1950 up from $13, a lot of people in the industry are loving it. netflix covering up. ashley: luring away california companies, more and more states going straight the golden state to sell, take some business away by promoting themselves as tax havens, if you would like. tracy: but first, look at some of the winners and losers as we head out to break on the nasdaq. we will be right back.
ashley: some breaking news for you. the tsa confirming this going to remove the controversial full body x-ray machines from airports by june of this year. they produce a naked image of travelers, the tsa says they will no longer be in operation by june of this year. tracy: i just went through coming and going wasn't even thinking they were taking naked pictures.
ashley: even in this economy they're spending thousands of dollars in rv. dealers and buyers are coming together right now in tampa, florida, where the locating is there. why are we seen such a boom in sales? >> there are a lot of reasons. the baby boom generation is retiring. another reason is there is a wide variety for a range of affordable prices. this is a new marquee top-of-the-line model. this one at the base price about $870,000, if you add all the amenities like a dishwasher, the kitchen sink, everything is hidden. laundry in here. it is truly very luxurious camping.
take it all in, even the shower and the bathtub. across the bay here in the tampa area in st. petersburg, at 4:00 every single day it is "happy hour." we met up with the second-generation rv couple retired specifically to do what they're doing. see the country and always have their home with them and for them they are bitterly living the life. >> meeting new people, enjoying the outdoors, working with people you've never met before. >> for me it is just fun, i love it. >> as other elements are not doing so well, the rv industry three years in a row with sales increasing 10% roughly each year. back to you.
ashley: have just over an hour to get to "happy hour." thank you so much. tracy: all right, drive to california. speaking of california, california's wealthiest residents are facing higher taxes and tons of new regulations for the businesses. states like nevada, georgia, texas and tennessee are sending recruiters to the golden state to lure businesses with the promise of lower taxes and less regulation. ceo of the arizona congress authority which is opened up to offices in california joining us now. i find this so interesting. he said these offices up and then what? these and other scouts to help the ceos? >> we have two offices. our focus is continuing to build
bilateral business relations between arizona and california. tracy: you have low corporate taxes, low real estate taxes for commercial properties. i would think it'd be pretty easy to wear the businesses in. what stops them? >> we have had great success working with california businesses. our strategy is to work with california businesses looking to expand their operations outside of california. in addition to that we are working with arizona businesses looking for a new market. the ninth larges next largest ee world and proximity to california is a real business advantage. tracy: getting some pretty good tax breaks. can the state continue to afford to offer such good deals? >> our governor and our state legislature have aggressively
been putting into and enacting policies and laws to increase opportunities for businesses that are successful. they have run two very aggressive agendas to ensure we have a pro-business environment, less regulation, the focus in arizona is to ensure businesses can succeed. tracy: do provide a breakdown of how much they would see if they came to arizona? >> absolutely. a very comprehensive strategy. we have experts on the ground in california and here in arizona and we outline the value proposition for those companies so the significant opportunities to grow your market, access talent in arizona while still working with businesses in california and globally. tracy: in the flight is only
about an hour from phoenix to l.a., so not like you're going all that far. i think it is pretty darn cool. you would not be surprised the worst state in our fine union for corporations, california. new york right above it. jersey has climbed a few, we're like 47. ashley: interesting stuff. liz claman will take you through the last hour of trading. a live interview with a bigwig on wall street. morgan stanley ceo with a one-on-one interview with charlie gasparino. you name it. "countdown to the closing bell" is next.