tv Bulls Bears FOX News December 31, 2016 7:00am-7:31am PST
they'll be celebrating the new year in what, 15 seconds? >> back here at home in new york city, rick on mission mariah car carey. what's going on? >> she's not here. she's late. as the new year approaches, consumer confidence soaring. new jobs coming. and donald trump taking credit. and now some here say he needs to push an across the board tax cut right away to keep it going. are they right? happy new year everybody. i'm dagen mcdowell in for brenda butner. this is "bulls and bears." gar b., jonas, welcome to everybody. gary b., is an across the board tax cut needed right away right off the bat? >> absolutely. dagen. look, we have had a rally in the stock market fueled and i think
quite rightly so on optimism that donald trump is looking out for america. he's going to do the right things economically, foreign policy. but economically i think there's still a few gotchas for most people out there. look, we have median household income that's still -- inflation adjusted still lower than it was in 1998, dagen, it's lower than it was in 2007. we have a labor force participation that continues to decline. just a couple years ago was 66%. now it's barely -- just a little bit below 63%. so there's people out there that don't have a job and still they feel, my gosh, i can't keep up with inflation with what i'm making. let's put the money back in their pockets. we know the government doesn't spend it effectively. we know the people, it's their money, they earned it, it's the best thing donald trump can do to kick off the new year. >> jonas, consumer confidence the highe esest level it's been since before 9/11. and it's because of the actual expectations of people looking
down the road and seeing maybe they get to keep more of their pay. >> it's been improving for awhile, but definitely took a major pop on optimism largely on the expectations of a pay increase through a tax cut next year. we don't get a tax cut, it's going to be kind of a downer for a lot of people, especially investors. it will also seem like that was one of the easier things to do you'd think given that they're in charge now. they can't get that done, what can they get done? being said tinkering with the tax code in long term is useless. one-time, payroll tax cuts, more brackets, different types of medic for obamacare, we have to have simplification. we can't have a simple across the board cut temporary because it's so expensive. that's a useless plan. we need to get things easy to everybody can see the improvement and how much smarter it is and don't have to do all
the deductions and incentivizes and then won't be hard to take away from us four or eight years from now. >> lee, you study consumer behavior and how people react. and actually boost in confidence can lead to a better economy because people act on that better feeling. >> that's right. we've seen it happening with the stock market rally, we've seen spending go up. one of the things that donald trump is going to do is he's going to do a lot of things that are quick wins. is he going to go in and make tax reform right away or put forth a tax proposal and start doing the things he promised to do on day one like executive -- you know, reverse the executive orders, continue to have conversations with companies to bring jobs back. i think it might take a little time for him to actually put forth a plan, as you said, jonas, more simple and get people excited and rallying behind. >> john, do we need an across the board tax cut right away, boom, do it? >> we need a corporate tax cut right away, and that is across the board. as far as personal income tax, to me i think that should come
later. that doesn't stimulate the economy that much and the reason corporate tax is so important is because small business creates over 50% of the jobs. you look at the average small business with pass through income, these small llcs, goes to personal income statement. so they're payi ining 39.6% taxd on that city and state where it's applicable, some of these small businesses are paying up to 50%. that is grossly unfair. the reason they don't have a representative in government. the corporate effective tax rate is still 22%, 23% because big companies have bought off administrations for decades. but take these small businesses and give them 25 to 30 of every dollar back, they are barely getting by, a lot of them. that will go directly into capital expenditures, into hiring employees, that is a direct stimulus to this economy. >> the market's been on a record breaking run, maybe not in the last couple weeks, but because of the expectation of not just corporate tax cuts but individual tax cuts too. >> well, look, first consumer confidence was making a comeback
way before donald trump was elected. and we have to keep in mind that too much of a good thing can be a bad thing when you've had consumer confidence too high in the past, recessions have followed. we also have to look at the fact when you have lower tax rates, that coincides with actually weaker economic growth. and it also coincides with weaker job growth. so donald trump is certainly going to make some quick decisions to help out the millionaires and billionaires that are his buddies, but i think he needs to keep an eye on making sure that the growth that we're seeing from president obama's decision making continues to happen. we saw from july to september 3.5% economic growth. and that was, again, way before donald trump is taking credit for boosting the economy. >> gary b., we had tax cuts under bush, and the bush economy annually grew faster than the growth that we've seen under president obama.
2.1% annually since the recessi recession, recent recession, and 2.8% from '01 to '07. >> dagen, i'm scratching my head. and we love jehmu on the panel, sort of, but i'm scratching my head. look, let's just put it out there that the low tax rates equal low growth, all right, i'm baffled on that one. >> since 1950. >> since you point out, dagen, reagan cut taxes, president kennedy cut taxes -- the whole reason tax cuts work is because you take it out of a government that spends inefficiently. and oh by the way, we have about a 17% approval rating of congress right now. why do you want to give them more money? and this whole point, jehmu, we want people to be happy but we don't want them to be too happy, first of all, is that the government's responsibility to determine how happy we are? look, people are earn the money for crying out loud. we know the government squanders it. let the people keep their money.
i'm in favor of a flat tax, make it simple as jonas and john alluded to. i think it sends a signal, make it a 20% tax rate across the board or even 10% across the board, shrink government for crying out loud and let the people spend their own money. >> jehmu, do you want to respond? >> i'm looking at his history and the facts and since 1950 -- >> give me under a president where that worked. >> -- have not guaranteed higher economic growth. >> nothing guarantees it. >> certainly under the bush tax cuts we saw some of the weakest economic growth out there. and this is since 1950 -- >> that was not a cut in the marginal rates though. that was more of a rebate. that was a tax credit to people, not a cutback on the marginal rate. >> jonas, do you think the market can keep going? and do you need certainty on these tax cuts in order for that to happen? >> i think we need some sort of tax fixes and cuts to keep the recent rally in stocks going.
i will say the stock market went up higher under obama than under bush. the economy was better under bush. i will say the economy's been slowly getting slower and slower decade after decade, that is a trend some tax improvement will only make a slight change to. i will say the one thing, gary, the only problem with the tax cut, yes, government spends money irrationally, but they can't keep spending it irrationally and give us our money back. that combination is dangerous. if they're going to do an across the board fix or an improvement, if it's a net major cut of revenues, then there's going to have to be some spending tied to it at some point or it's going to end badly. if we get a happiness bubble, we can always tax happiness -- >> and the democrats would if they could. john, the danger is people have gotten their hopes up. that the jump in consumer confidence is the equivalent of a full percent jump in consumer spending, which is the vast majority of our economy. so if you don't give them what they're expecting, then you
knocked optimism out from under not only individuals but the economy and the market. >> yeah, and the question is the lag time. look, the exact same thing happened under ronald reagan, and jehmu, nobody gave jimmy carter credit for the bounce. it took about 18 months for reagan's reforms to catch in. i think trump is going to have a twik u quicker time because he's going to be able to pass corporate tax reform and regulation reform earlier. but when you look at history, look at 1920 under calvin coolidge, 1986 under ronald reagan, 2000 under president bush, all tax cuts equated to higher economic growth. and look under president obama we've gone from 2.1 in revenue going to the government to 3.3, a 50% gain in tax revenue. and yet the debt has doubled and we've had under 3% gdp growth in under ten years. to try to cherry pick that is more than misleading. >> thank you. thanks everybody. cavuto on business is about 20 minutes from now. kennedy is in for neil today.
hello, kennedy, what have you got? >> hey, dagen, the nation's second largest labor union slashing its budget saying when president-elect trump takes office unions will take a loss. but some here say that means all workers will win. plus, brawling teens creating havoc at malls across the country, now calls to ban minors without an adult to keep shoppers safe. we'll debate it at the bottom of the hour. >> thank you, kennedy. we can't wait. but up here first, one of president obama's last acts, slapping russia with sanctions over accusations of trying to interfere with our election. lawmakers from both parties saying it's not enough. are they right? we debate, you decide. next.
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happy new year's eve live from america's news headquarters in washington, i'm leland vittert. president-elect donald trump offering praise for russian president vladimir putin. on twitter mr. trump calls putin, quote, very smart for not retaliating against the united states. the russian leader says he will not kick out american diplomats from his country, this despite president obama's announcement that 35 russian intelligence operatives are per son na non grata in the united states over accusations of meddling with u.s. elections. and a powerful nor'easter
slamming new england. heavy snow and strong winds knocking out the power. tens of thousands now in the dark. some places have seen more than two feet of snow. utility crews say it could take days to restore power. and you can see pretty tough to get around up there. i'm leland vittert, "bulls and bears," i'll see you at noon eastern for more news. president-elect donald trump just calling russian president vladimir putin, very smart. that's his response as putin puts off any retaliation moves against us for those sanctions. instead, russian officials seem more than happy to mock our current administration trolling it with tweets like this one, basically calling president obama a lame duck. lee says this proves these sanctions do not go far enough. lee. >> there's no question that these sanctions aren't going far enough. this is merely a slap on the hand. and one of the things that i think is real problem here is that because of the timing of all of this, rather than it
being taken seriously, a lot of people think this is just politics. obama once again didn't sell why he's doing this. there's no bigger narrative than he was interfering with the elections when we have a bigger problem with russia than just this. so i fear that people don't understand the full narrative, people don't understand all that has gone into investigations on this. don't really know what the facts are right now. so it seems, i think very, very fishy to a lot of people that 20 days before he goes out of office this is what we're doing. >> jonas, hit him where the money is, hit him where it hurts, these sanctions don't do that. do we need tougher sanctions? >> look, we've already had a bunch of sanctions when they annexed crimea. we've been trying to sanction this country. the problem is they don't have enough economic interests, so to say, they don't sell enough goods to our market where we can actually hurt them enough. and they're a little ham handed and winds up making the straw man leader more popular with his own people. anything that does that -- look, honestly, i'm glad trump has a relationship it seems like with this guy that's weird and hopefully we'll have a better
relationship. but i'm also concerned that they're basically playing chess and we're playing checkers at this point. and we're doing things that seem not really at the level they're operating at. if they're going to hack us and say they didn't do it, maybe we should hack them and say we didn't do it and have some stuff we release to make putin looked dressed up in a goofy child's outfit with dom nay tricks, i think we're playing a different game than they're playing and we're losing at this point. >> or, gary b., release financial information about putin and all of his buddies that prevent banks internationally from doing business with them. that would be tougher. >> yes, it would definitely be tougher. going back to lee's point, she said a lot of people don't understand this. you know what, lee, i plead guilty. i don't understand, i don't even understand why is he sanctioning? what is the end game? what is he going to make russia do? not spy on us, not hack us?
we're already spying on them, we're hacking them, i'm not saying what russia did were right but we're sanctioning them, what, because exposed democratic national committee e-mails, hillary's e-mails? that's the big thing? i think the whole thing is silly. i think once again obama has proven that seriously he is the worst foreign policy president we've ever had. >> jehmu, clearly democrats are upset about the hacking. do these sanctions need to go much further? >> sanctions are certainly a good start, i think we also need an independent bipartisan commission investigating what happened. and anyone who is not outraged by what russia did, if you're a democrat, if you're a republican, you put that aside to try to make excuses and applaud putin's bromance with donald trump is just beyond. we as a country have been attacked. our electoral process has been attacked. if this was any other
circumstance, if it wasn't obama, if it wasn't against democrats, conservatives would be up in arms. and that's a fact. anything else is straight hypocrisy. >> on that note, john, tougher sanctions then? >> no, how do we know what tougher sanctions need to be? we don't know exactly what happened. >> exactly. >> and to say that we're under attack, that's crazy. look, we have been spying on the russians for decades. they have been spying on us. we catch their spies, we send them back, we throw out diplomats. they catch our spies, they send them back, we send them back. they have been hacking us, this is tit-for-tat. putin is going to eat it, united states is going to say russia don't you hack us again and it's all over with. this is status quo going on right now like it or not. >> john, thank you. thanks everybody. cashin in just over an hour from now. eric, what do you have coming up? >> some democrats vowing not to work with donald trump after he's sworn in. is it time for the left to move on for the sake of our country?
plus, a new controversy over new film about ronald reagan. why one a-list actor is reportedly worried about taking the role. the cashin in will see you at 11:30. thanks, eric. we'll be watching. first, thought amazon's delivery drones were a wild idea? how about an amazon warehouse in the sky? that's next. look at this... a silicon valley server farm. the vault to man's greatest wonders... selfies, cat videos and winking emojis. speaking of tech wonders, with the geico app you can get roadside assistance, digital id cards... or even file a claim. do that.. yeah, yeah that should work. it's not happening... just try again. uh, i think i found your problem. thanks. hmm... the award-winning geico app.
it's a bird, it's a plane. it's a flying warehouse. news leaking this week amazon is landed a patent for a blimp size fulfillment center 45,000 feet in the air. and it could act as a launching pad for drone deliveries. jonas, not a good idea? >> you know, sometimes i think when we all watch "blade runner" and we're scared of what the future will look like, jeff bezos is like i really likeof t that's going to be me with the fake -- they had ads on blimps floating around during the super bowl delivering beer to people because they need it that instant. what kind of world is that going
to be? it is going to be this horrible sky scape of noise and minihelicopters. they better crack down on this and figure out a way that doesn't just ban technology to promote a world we can all live in. >> gary b. >> jonas needs to go into a fallout shelter somewhere and just stay there. look, with progress sometimes comes missteps. look, we would never have built the hoover dam if we were afraid of people dying, 100 people died building the hoover dam. we built the empire state building, a plane crashed into it as people thought it might because it was foggy. with great innovation sometimes comes missteps, sometimes even causes pain. look at the wright brothers, we need to do this, it would enhance our lives, it's the best thing to do. >> jehmu, good idea for consumers? >> i'm all for it. you know, people were in horse and buggies and didn't want cars on their roads. and look at where we are now. i just want to know where's my flying car. here's the thing, innovation is
good. this is what america is about, progress. that's how we get better. the whole idea of make america great again go back to the past it makes no sense to me because i think it's through innovation, it's through technology. come on, amazon, give me a flying car. >> lee. >> flying warehouse, a good idea, good for consumers or bad? >> i think it could be good for consumers. i agree on the innovation, but i think this could also be downright creepy. having all of these all over the place, are there people operating them? how does this even work? i think people are going to be concerned about security. i think there's also kinds of things people are going to be worried about. so i really think amazon's going to have to do a good job selling this to us. >> john. >> i can hear all these ledites saying damn that printing press, they're going to take jobs from scribes and kill all kinds of people. this is technology, this is where we're going. >> thank you everybody. and special thanks to lee and jehmu for joining us.
balanced way to make money on tv. our gang's best and worst calls in 2016 and how you can still profit from them. right now in the scoreboard. we do the bad and good here on bulls and bears saving the best for last and starting with the best of the worst, gary b., you're up first. you said drink up profits with anheuser-busch, well, it's down 20% since july. does it still have a chance to brew up some returns? >> as long as people are drinking beer, i still love it for the long term. think it's a good stock. >> onto number two, jonas, you said buy up quartz market down 22%, do you want to return this pick? >> even though trump's a law and order guy, no. they're not going to do private jails anymore, so, no, for the federal government. >> now on to the worst call in 2016, john, you said under armour would be an undoverachie but down 43% since you said buy last april. buy, sell or hold? >> i still own it.
kevin plank has done a great job. they've gone through a rough patch. i think it's a great company for long term holding. >> for best buy, jonas, you're going to kick everything off. you said airlines would fly higher, you're right soared 43% since then. >> no sell. >> onto number two, john, ten months ago you thought amazon would be amazing, and it has been jumping nearly 50%. you still like it? >> i do, but wait for pullback. i think it's a great company. >> and now on to the number one call in 2016, gary b., last january you predicted toro would see some green, if our viewers listened to you they'd have a 63% gain. cashout or buy more? >> i would sell half at this point. still like it long term but had a fantastic move so take some profits. >> thanks, guys. get the fair and balanced, pat on the back and kick in the butt, time for best calls of 2017, predictions, gary b., go. >> i'm stealing john's pick from
last year. i love amazon. i think it's up 30% this year. >> john. >> verizon. i own it. 5% yield. i think it's a great company. up 30% in a year. >> jonas. >> power shares high beta stock for 2017 up 20%. >> happy new year. kennedy now. all right, a fox news alert, big labor blaming president-elect trump for big cuts before he even takes office. the seiu planning to slash its budget by nearly a third in the coming year and pointing the finger at the new administration. says when republicans win unions lose, but some here say that's a win for all workers. hello everyone and happy new year. i'm kennedy in for neil cavuto. ben stein along with jessica, charles payne, charlie gasparino and adam working on
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