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Back on the Kudlow Report at 7:00 pm this evening with Chris Whalen. We are discussing the Market, the Fed, and the Deficit.
For a preview, some bullet points:
Market
1. Markets look like they trade poorly, but refuse to go down. A very powerful bid is beneath
2. Stocks are reasonably priced – not cheap but not dear
3. Earnings have been very strong
4. The trend is still upwards
5. QE2: Give me a $100 billion per month, and I will throw you a helluva party.
NOTE: Only small divergences so far: 52 week high is softening, sentiment a tad bullish – but nothing is at an extremeBernanke’s Fed
1. QE experts? Suddenly we are a nation of amateur policy wonks
2. There are probably fewer than 100 people in the world who are qualified to discuss this intelligently in great detail (Sarah Palin ain’t one of them)
3. As a money manager, my job is to discern the impact of the Fed’s policy on equities and bonds – not analyze it for my Poli Sci finalDeficit
1. Social Security is fine – raise retirement age, raise the cut off for contributions ($106k), means test, etc.
2. Medicare is the bigger issue – prescription drugs, etc. We have the world’s most expensive, least efficient health care system (The ER)
3. Defense cuts must be on the table
4. Discretionary spending must be on table
5. AMT Tax is an issue
6. Mortgage deduction for vacation properties, boats, etc. (but I’ll bet that $500k gets raised)
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