Transcripts For CNBC 20100429 : vimarsana.com

market rally rely on a zero interest rate ultra easy money, what i call free money? how important is free money? i think what s important from the point of view the economy is expanding for the next several years is the fed not do anything to get tight and choke off the growth. i don t think they will for two reasons. one, we have a huge amount of slack with unemployment rate almost 10% we can grow for several years before we start to draw down the supply of labor to the point where we get labor inflation. the other part is congress is very angry at the problems in the economy. they talk sometimes about curtailing the fed. and although bernanke will never admit it, he s going to be well aware if congress is inclined to restrict the independents because they re upset that he isn t liberal enough, they can start to do things. i think we re going to see an accommodative effect. that doesn t mean the rates won t go up 2% or 3%. ed yardeni what do we do. the earlier conversation. emerging markets improving. more capitalist in old europe for example and old japan and maybe old u.s. as well. you have this rally in gold and commodity prices. we can put it back up on the board. you have v-shaped rebound in the journal of industrial metals and the big move up in gold. how does that inform you? what should the fed do about this? what does it mean? as you know, larry, the hawks hoenig is talking about raising the federal funds rate at some point here to 1%. i think he wants to do it sooner rather than later. my reaction is that s not very hawkish. if our economy can t if our economy can t stand a 1% fed funds rate, we really have a very unhealthy economy. i would welcome some tightening here. i think it s also only fair to investors. there is a kind of a gross m misallocation of capital. believe me, i love bull markets and stocks, but i like them to be based on good long-term sustainable fundamentals. the fact that conservative investors are earning nothing on their money and some may be forced to take on risks, that s not a long-term healthy development. michael o rourke, two questions real fast. will the fed raise the target rate? how damaging might it be for the stock market for investors to see a war between washington and the heartland reserve banks? well, actually, larry, i don t think it s going to be a war because i think all the votes are in washington. and the reserve banks can do is voice their opinion. so tom hoenig, he s almost a sole voice because he s the only voting member voicing that opinion now. five vote? five reserve banks? you have seven governors and 12 members and one of whom who is the new york fed who will go along with bernanke. you have four reserve bank hawks potentially on the fomc. they might make a stand. they have the power of the bully pulpit as their reserve bank has. they re all out there giving speeches and stuff. 24e do. the other most vocal reserve bank president has been here in philadelphia. and fed president evans in chicago. but they re not voters. so that s a problem. jim bullet out in st. louis is a voter but he s more mid fl the road because he wants asset purchases as a tool indefinitely. i do think it s tough. with bill dudley lining up with bernanke, i think all the new governors are going to fall in line right behind bernanke. so i think that bernanke is going to rule the day here. all right. i don t have too much time on this. just real quick, ken heebner. you mentioned ford before. what s your next favorite investment on the way up? at this point, retailers because i think the big department stores are going to surprise. and other retailers too. when the april quarter is reported. ed yardeni, your favorite investment right now? semiconductors and technology and platinum and palladium have further to go. tech and you like the commodities? yeah. great stuff. thank you very much. mike o rourke, ed yarden i had and ken heebner. coming up the oil spill in the gulf of mexico is becoming worse than expected. will this accident kill drill drill drill? northbound s jay gray joins us with details. the fda approves a vaccine for prostate cancer. cnbc s bertha koocoombs has tha story. want to see what warren buffett is doing? invest some time in us. now, if the deep water horizon oil spill is now spilling out 5,000 barrels of oil a day. will this accident kill drill drill drill in washington and what s the impact going to be for the gulf waters and their economies? nbc s jay gray joins us now with the details. jay, this thing is looking worse and worse every passing day. reporter: yeah. no question, larry. they believe now that some of the oil will make landfall late tonight. crippling news for this area which makes most of its living from the water here. we ve talked today with a lot of fishermen, oystermen and shrimpers. some of the shrimpers moving out and harvesting shrimp early. they opened it early to let them try to minimize some of the effects the spill may have on damaging and killing the shrimp here. a lot of these people said they probably won t make it back from this. we re talking about families who for generations have been doing this on these waters now saying after katrina they fought so hard to get back and at this point they re having to deal with this man-made problem which frustrates a lot of the people here. and they think that the blow will just be too devastating for them to make it back. a lot of them talking about this being the end of their family s work as oystermen and shrimpers here in the gulf. it s only getting worse. i understand governor jindal of louisiana is going to declare an emergency if he hasn t already done so. this may be a little unfair but are you hearing anything the white house is giving mixed signals. they said, no, this won t affect the offshore drilling policy and later said we re going to look at it carefully. that may be the least of your problems and the people s problems down there. but are you hearing anything? reporter: yeah. no. and we ve kind of talked to people a little bit about that and they say that s a washington problem right now. our probable our problem is more local. i wish i could tell you more but right now they re focused on what s going to happen for them and what they see right now is not good at all. there is a state of emergency here. the governor declared that today. they re hoping that will open up some federal funds and get more people down here to help with what looks like will be a clean-up at this point. jay gray, we appreciate your update very, very much. for a more positive story. a major breakthrough for prostate cancer treatment. the fda has given the greb light to the first therapeutic vaccine. bertha cooms h a crooms is here. the approval of provenge marks a new era. it s the first ever vaccine approved to treat cancer in this case advanced prostate cancer, a disease that kills nearly 30,000 men a year. len bender finished his last provenge treatment today as part of a trial at duke university center. i woke up today feeling the best i have felt probably in three or four months. reporter: with fda approval of the cancer vaccine, dandrion say it s ready to make it available by next week. we fully expect it will be the foundation of care for men with late stage prostate cancer. reporter: it s the first therapeutic vaccine to harness the patient s immune system to fight cancer and extend survival. we are actually teaching the patient s immune cells to respond to prostate cancer. patient s blood cells are extracted, shipped to dendreon within hours for processing and shipped back and infused within days three times over the course of three weeks. the price $31,000 per infusion. right now, the company has only one facility up and running. two are under construction. dendreon says it s going to take about a year to ramp up to meet demand for provenge. they expect to have all three of the new facilities running at full capacity by mid 2011. len bender, his treatment complete, hopes provenge buys him precious time. it extends your life. and that s what i m counting on. the benders, in fact, today have booked a trip to go to paris. and, larry, the thing that s really exciting is there are about half a dozen others in stage two or stage three trials and we re expecting to hear about some of those late stage trial results at the big cancer meeting in june. god bless. thank you, bertha. it s a great story. i say god bless because i hope it pans out. from your lips. so speaking of american ingenuity and free market capitalism and its benefits, take a look at what we found on the internet. the next generation of free market capitalists are singing the praises of our very own kudlow creed. take a look. hey, guys. i know times are hard right now. there s a recession and people are having trouble finding jobs. everybody wants a solution. if you want a solution, just listen to this. i been working hard since the day i was born making money any way i can and i d like to think i could do better if i lived in a free market plan it s a complex theory where at the very core very simple it goes like this let the market take care of itself and i promise you that soon we ll be living in bliss my money can t be regulated unless it s abroad and then the government will make sure a solution created but the invisible hand by adam smith it s just a matter of who you deal with set your own price and enjoy your product free market capitalism is a plan that s right the kudlow creed you don t want a recession book to this creed and you made learn a lesson. take a good hard look all right. i just love it. i just love it. many thanks to stephen boyd and his pals for putting that together. i want to meet all of them. we re going to get them up here on this show. great stuff. wonderful. coming up, can the tea parties stop the outrageous 40% dividend tax and other job-killing taxes and other problems? we re going to have the editor of the american spectator magazine on the other side of the break. you re watching the kudlow report where i say once again we re firm believers in the kudlow creed free market capitalism is the best path to prosperity. (announcer) roundup extended control does two jobs. at once. one: kills weeds to the root. two: forms a barrier, preventing new ones for up to four months. roundup extended control. all right. one of my favorite topics, will the republican party actually start listening to tea party populism to take back congress come november? tea party populism meaning free market populism. reaganism redux. so let s talk to my great fend bob tyrrell editor in chief of the american speck aitor author of after the hangover: the conservatives road to recovery. welcome back. a very bad story today. i want to do tea party stuff with you. team obama we don t know who, homeland security, whatever. they actually sent sniper teams on rooftops on and they also had teargas people going through the crowds at a tea party rally in quincy, illinois. what is that all about? these are like upstanding working folks. on the blog breitbart s big government they had grand mothers attending the rally. here they re sending rooftop snipe tors a tea party rally. what do you make of that? i think the obama team is the most isolated inexperienced left wing team ever to be living in the white house or operating out of the white house. they believe their own baloney. and they ve been saying that the tea party people are violent and that some of them have called them racists. they ve compared them to timothy mcvey. it s about as preposterous as you might imagine. as i say in after the hangover there s something about america there s something in the air here that makes americans, liberty loving, love limited governments, low taxation. we ve had things like the tea party going back economic freedom. preserve economic freedom. constitutional restraints on government. yes. and we ve had this these outpourings of libertarian sentiment since the 30s. michael barone in a seminar we did at the heritage found days the other day pointed out that in the late 30s you had this kind of tea party movement breaking out against the new deal. he thinks if we hadn t had world war ii facing us, we might very well he might very well have suffered grave opposition. so we re faced now we have improving economy and great stock market. we re faced with this wall of taxes including the 40% dividends tax which is off the charts, even 20 points higher than president obama wanted. can the tea partiers and this revolt you describe, had libertarianism, can they be politically effective in november and stop these tax hikes? i think they already have been. we have a monthly dinner of editors and writers, wall street journal people and post people. they make it very clear as the months passes, the opposition to this government is growing and there will be a wipeout in the fall. what about this here in new york. the afl has organized a march against wall street. and you saw these goldman sachs hearings kind of a witch trial. now, i m not going to defend everything goldman sachs has ever done. but a lot of it was aimed at the fact that goldman was smart, successful and profitable. private profits now. what s this all about? the unions are marching against wall street. the congress is marching against goldman sachs. what s going on here? and can the tea party revolt stop that? well, i think the tea party revolt, as i say, it s so american. i m so heartened by it because here we have when i started writing this book in 07, right after the election of 06, we had people saying that conservatism was washed up, conservatism is dead. and get with it, get with the status program. and look what we found. about the very time of the election, we conservatives outnumber liberals two to one. so it can be taken back? right. you re going to come on the radio show saturday, too. coming up i ll award kudlow s nobel prize. goldman off 2.5% in after-hours. federal probe of criminal prosecutions and the nobel prize goes to steve boyd and his friends for putting the kudlow creed to music. it s monday, some people will stick with their old way of getting vitamins and minerals. others will try incredible total raisin bran. with 100% of the daily value of 11 essential vitamins and minerals, juicy raisins and crunchy whole grain flakes. guess it s all about what kind of crunch you like. how are you getting 100%? original production. we know, father, that people have worked hard for their homes, lord. and we know that you ve blessed them with them, and we know that you didn t bring us this far to leave us. we have evictions every 20 minutes, and i was just trying to get ahold of you to see if we could get in there. every 20 minutes, sir. sheriff s department! these are nicer, upper-class homes, but i believe that middle-class people got into them thinking that they could afford the payments. you re going to come into this neighborhood, and you re going to start seeing all kinds of foreclosed homes. you have four houses right here. you have five, six. probably a foreclosed one there. one there. you look down the street here, and then there. you come around. you have another one right there, one right next door to it. this is just one street. so we ask that you would be with us today, lord. sheriff s department. bless each one, that we may save all the homes if possible, lord. you know, the grass is dying. the leaves are the flowers are gone. [ voice breaking ] and it s kind of sad. we can t move. we can t afford to move. so. one of the biggest worries is crime and, you know, money going down and your city going down. your community starts to go