Also in this playlist...
This transcript is automatically generated
It's going on retailers seeing sales dropped last month.
And more companies like Family Dollar warning that there are not expecting to see customers' spending.
Pick up for the rest of the year but get -- the stock market still going up the Dow rising again this week now closing in on 151000.
So who's got it right in the economy stocks or consumers hi everybody I'm Elizabeth MacDonald welcome to -- on fox.
Let's go in focus with sea floors like Unger Michael opinions the British paper John Candy and Morgan -- so Mike who's got it right.
He -- the consumers have it right if you go back to 2007.
Before the last bubble burst.
The consumers were on this in January of 2007.
Consumer confidence -- very started to fall.
The stock market took and told October of that year to realize what was going on.
This time consumers have -- right cheap price is cheap money from the Fed is raising stock prices but it's actually making consumers poor.
-- so Steve here's -- data points any retail sales the lowest in nine months.
We know we had a hideous jobs number last Friday.
And consumer confidence down so who's got it right embody what the market hit up for the fourteenth time they had -- record this year with that right.
Up the market has it right and you can have a good market and a -- economy actually the market's not good in real terms less than it was a full.
Five or six years ago.
A company corporate earnings are way up they have plenty of cash they haven't paid out in dividends.
So we have a real peculiar situation dividends are higher than bond yields -- it's similar companies.
So the market is not hardly -- bull market only because those dollars going down in value.
So -- you can have both -- economy and a seemingly good market but in real terms of market is also punk.
You know you wonder Sabrina the blue sky crowd is too much in control when you look at -- retail companies I -- you got companies like that gap.
You know banana republic they're all saying hey wait a second we're not seeing -- retailers.
-- some -- government say hey we had a bad winter or you know he had an Easter break I'm not so sure about that but got it right Sabrina who do you think.
Well I I wish that the stock market forecasting correctly but I'm concerned that the consumer has it right I mean when you look at that anemic economic report that we -- -- -- see that businesses are scaling back.
Workers are dropping out of the labor market altogether because there are no jobs we just saw this.
Sequestration circus here in Washington I would no real meaningful cuts and now the president has -- has presented by -- with nearly 600 billion dollars.
And you tax increases on businesses and on the wealthy so I just don't -- right by my calculation this is not a formula for strong economic -- You know Rick is the -- brings that the tax goes it's also -- 900 billion with all the fees loaded and but -- say something Jamie Dimon at JPMorgan Chase is saying you know what small businesses are not spending.
And we have at the confidence.
From small businesses is not doing so great lately what do you think is the answer here.
Let you know what's happening here is you've got two different economies going on in two separate tracks the market's doing well I actually give a little bit more credit.
-- it expanding sales in foreign territories we don't tend to measure this step by the US and Europe but there are places like Indonesia like India.
Where company American companies are selling a lot of products and that's being reflected in the market.
Here at home we still have the same problem we don't have enough jobs if the middle class is shrinking they don't have money to spend.
We have got to do more for these jobs congress has got to stop obstructing the president we have got to do what it takes to get people jobs.
-- right in over -- -- John I mean we have been letting the government do what it takes to get.
Middle class people that -- so the housing industrial complex.
And ended -- place -- the best foreclosure mitigation is a job.
And I just think that you know when you look at what's been going on with the current policy John.
Is that the governor is wait too much planning the economy right.
Oh absolutely and I would point out about market -- to talk about them is to bring new meaning -- soft bigotry of low expectations mean realistically these were highs.
Experience thirteen years ago when the dollar was much stronger.
-- when you look at the stock market overall it's not no surprise that'd be disconnected from the consumer stock market's price in the future and they do not price and the president.
And I -- stock markets are saying down maligned thanks to gridlock this will be good for the economy in this -- eventually be helpful by the consumer.
-- -- what about Joseph Biden says recovery summer and 2010 -- -- out.
That's a great racehorse -- hitting it.
But now looking at -- out our second you know those highs that we haven't seen since 20171007.
We did having economy booming housing bubble is still in full throttle the fact that we're back those -- right -- is very peculiar to me given the fact is other people mention we have.
-- twelve million people unemployed we had median salary stealth flat we've retail -- spending on the on the downturn again.
I think this is I think there's a larger issue here that haven't been touched on yet and that's -- fact that the government is very heavily involved right now we have three trillion.
But wait a million dollars ahead at the Federal Reserve is pouring into the bonds and pouring its mortgage backed securities of government stimulus money.
Every time we see the stock markets jump higher it's usually in response to something the government saying hello Margaret outlining what Morgan as saying is that there's too much going -- from that from DC what do you think.
All right you know you -- ice I see your point but you could easily make the argument that government was never allowed to do enough.
To get this thing back on track high note this is not comfortable for everybody else sitting here but yet another way to.
Matter of philosophy I think -- -- Italian artists they've been ahead -- this is the definition of insanity you hurt the patient the patient gets worse they got a poison more spending means taking real resources from the economy and telling politicians fool around with it.
The president the reason my on the market went up this weakness because people -- the presence crazy attacked -- are not gonna pass.
The Federal Reserve is cheapening of dollar which it wireless from the 1970s.
Get the government out of the way in the American people do the job Tammy you wanna weigh in go ahead.
Oh I do want to -- in the notion that government hasn't been able to do you wouldn't want to do it's the exact opposite recessions are cleansing mechanism that's how you remove all the bad things from the economy.
The government has blocked it and that's why we haven't seen a real market rally people talk about quantitative easing -- in the stock market.
But the better question to ask is how very much higher stocks would be if the Fed were not intervening in the economy and propping up the failed ideas of yesterday specifically housing and governments don't.
Had Morgan Morgan -- -- -- and actually interestingly look at investors they actually don't believe in the stock market rally in any color artificial.
Break quote from investor Jim Rogers a couple weeks ago if you give me a trillion dollars.
I'll show you a good time to and a lot of people are having a good I am I -- that the market now it's on a parabolic move up what you say in the market is also matching what it was earlier last decade.
That run up that you're seeing now.
Facing the same right up now.
You know I have I have to look at the charts a little close there there really answer that maybe Steve can speak that -- strong like but.
Thank you don't -- it go ahead rather not go ahead Steve I want to hear your.
It's just leave now let -- -- were John is right the market in real terms much lower than it was fourteen or fifteen years ago on companies have gotten their act together and you cannot confuse companies with the economy.
Companies are much better shape than the economy especially big companies what that's reflective of that but I.
Well I don't want to point yeah go ahead Sabrina quickly I -- -- to my quickly.
Yes that's it that's appointed that we can't just -- on the street economic indicators right and we also have to consider inflation rate and tax rates and the number of people who are leaving the workforce all of these things that are going to.
To help with commute -- how how we're actually dealing yet I just to bring his point might I mean as optimism optimism small business optimism -- the doing of what -- great.
Optimism is of what's being called -- force multiplier in the economy when you think about -- -- there -- one of the big reasons why consumers aren't confident is because we've had a big increase in regulations and a huge increase.
In taxes under President Obama this is why companies aren't investing they've been able to increase productivity which is one of the reasons why stock prices have gone up.
But take home pay is not increasing as who would normally under recovery this is the worst recovery we've had since the depression really because it too much taxation.
And -- -- a lot of it but you know W Mike is always wanted to obamacare -- I want float on the launch pad that's and his dream but if we don't know if that's gonna happen.
I want -- -- quickly sneak something in here you know this is that we -- last mrs.
And conservatives everywhere understandably.
Are spending a lot of time talking about how she turned around the British economy you know how long it took two years fifteen years I was he'll -- two minute did you honestly there's always gonna.
Yeah and yet and yet -- Obama after a year and a half was being condemned for not.
You're doing good to Europe or are you saying then we'll re getting all these dividend actually work -- it took about fifteen I actually and I can't -- I met -- Saint George w.'s Paula.
He's not what I'm saying is if we already use the same logic that the conservatives are applying to mrs.
Thatcher belong cut the summer break to Obama.
That means that not -- who was responsible with a regular yeah.
Filter by section