A hairline fracture to the mandible and contusions to the metacarpus. What do you see . Um, i see a duck. Be more specific. I see the aflac duck. I see the aflac duck out of work and not making any money. I see him moving in with his parents and selling bootleg dvds out of the back of a van. Dude, thats your life. Remember, aflac will give him cash to help cover his rent, car payments and keep everything as normal as possible. I see lunch. [ monitor beeping ] lets move on. [ male announcer ] find out what a hospital stay could really cost you at aflac. Com. Congratulations to my good friend becky quick. Theres always a bull market somewhere, im jim cramer and ill see you tomorrow. Everyone. Im larry kudlow. This is the kudlow report. All right. A touch of optimism tonight. Thats right. Corporate profits, record high. Housing showing signs of recovery. Business investment and manufacturing, reviving. We just had the dow post its second highest club ever. The fed, stimulative. Its not perfect. Wages and jobs are on the sloppy side but i believe the budgetcuts sequester will not lead to catastrophe and the margin will help. Heres Something Else to boost the economy p. The Keystone Pipeline. The oil industry is celebrating the fourth positive report on the project that came out late friday. President obama has run out of excuses. He must approve the Keystone Pipeline. You have heard of too big to fail. What about too big to jail . A Bipartisan Team of senators wants to know if the Justice Department is refusing to prosecute big banks because they are afraid it would implode world Financial Markets. The kudlow report begins now. The dow continues to flirt with a record high. We are 37 p points from the 2007 peak. Corporate profits at record levels. Profit margin 14. 2 in the Third Quarter of 2012. Thats the best since 1950. Housing getting better. The latest numbers show Housing Starts up more than 24 over the past 12 months. And the natural gas shale energy boom has begun. Experts predict it will last for 30 years. The economy still suffers from high unemployment. Not much upward movement in income levels. Pot line, the economy is growing. The real bottom line to me, lower spending and limited government is good for free Market Private sector growth and thats what we are getting out of washington warts and all. Lets bring in dean baker, the codirector of the center for Economic Policy research, and former reagan adviser art laffer. Art, i begin with you. It aint perfect. I dont want to dwell on the sequester. It does cut spending which i think is a good thing. Why is everybody doom and gloom . For the first time in i dont know how long we cut some spending . I think the spending cuts are great. We have been having spending cuts in this administration for probably three years now. Spending as a share of gdp dropped sharply since almost the full four years of obama which is one of the major reason it is economy didnt go further south. If we can get sequesters and real cuts it could launch the economy into a boom. Do you give Congress Credit . Most of the spending cuts came at the end of 2010, 2011 and now 2012. Yep. Maybe the gop is doing better than people think . I like what theyre doing. Its good holding firm on the no tax increase. Thats wonderful. Then having spending cuts in addition to that, it doesnt get much better, larry. Dean baker, do you buy the enthusiasm about the sequester . I think you guys are looking at different economies than what i have seen. The economy i see has been growing at less than a 2 annual rate. Congress fall Budget Office projects 1. 5 this year. We are down around 9 million jobs. The unemployment rates likely go up this year. I dont know. You think thats good news . I guess well have longer lines at the airports and delayed flights because of fewer air traffic controllers. I dont know. Doesnt get much better than that in your world, i guess. The Washington PostFact Checkers give four pinochios. I didnt hear a single backup in airplanes. In new york if you can get out after waiting 90 minutes thats a win, not a loss. Larry, nothing happens until april. Dont look for anything. Its a lot better than its been for four or five words. Its bush before. The last two years were catastrophes. We are starting to come out of it. This is not a good economy by any means. Thats policy. You are starting to see the signs of a real recovery, especially in housing and energy. Those areas are looking good going forward. Thats what im getting at. Dave . Its a long way to go. Youre right. We lost about twothirds of construction. Its going to take, like, four years. I dont mean the bubble levels. Just to normal levels of construction. Thats true. Its going in the right direction. Thats a long way to go. Get the government out of the way. It would go faster. Of course. On set we have chris kofinos. Robert trainum, a former bushcheney Senior Adviser and santorum aide. I like that one. Im glad you put it on your resume. Jonathan gollup from ubs. I hope ricks not watching. Ill get a phone call for sure. Hes an old friend. Jonathan, im not making the case that we are in a 4, 5 boom but at the margins are things improving such that the alleged sequester recession i hear about, b 750,000 jobs lost minus almost 1 of gdp, can we avoid that . At the end of the day you have a gap between tax revenues and spending. So either well address the spending or face huge tax increases down the road. What im not hearing is a progrowth agenda. Talk about the Keystone Pipeline. Energy could be a big part of that. I agree with dean. Wall street estimates took gdp from 2 to 1. 8 in the last month because of higher taxes on payroll and because some of the sequester. Theres pain if we cut the spending now. Why dont the stock markets show that . I think the stock market likes the fact that we avoided the worst outcomes of the fiscal cliff and the debt debate and perhaps the republicans unwilling to use the debt ceiling to fight a hard aer fight. They are looking at it as stimulative in the short run. Robert, i want your take on this. Sequester, good or bad . We are looking in terms of economics, not the politics. How do you read it . Economically this is a good thing in the long term. In the short term it will hurt republicans. The Republican Party is the party of no right now. From a messaging standpoint Speaker Boehner hasnt articulated why this is good for the american people. Ill tell him you said so. Please do. What message do you want him to have . This is a good thing. Every American Family has to balance the budget. Why cant we . Every american budget, when you cut things back you have to reprioritize things. You focus on whats important. We have yet to do it as a country overall. I think the sequester, frankly i agree is a pro Growth Initiative in the long term. There is a spal but a good one. Chris, your man senator mansion i would bet would vote for it. Hes a fiscal conservative. I can say what i want now that im not working for him anymore. Do you work for Rick Santorum also . No, no. Ta would be an a interesting day. Enough of that. When it comes to senator manchin, he looks at the sequester and realizes like i do that its not a smart way for government to do business. We all know we have to cut spending. No, we dont. Some of us know economics here and that the private sector demand collapsed. You missed the collapse of the housing bubble. We lost over 1 trillion dollars in demand. If the government doesnt make it up, no one else does. That may be funny for wall street but not for the country. There is a smart e way of doing it. This is not a smart way. When you have an economy with with a split personality. High unemployment, stagnant wages for a decade. Sure you have high corporate profits, a booming stock market. Thats not bleeding down. When you have an economy that for good and bad is driven by Consumer Spending, a sequester that will go into effect and over the next few months it wont happen a immediately. It will roll in. 44 billion dollars. Out of a 16 trillion gdp. Thats true. The Federal Reserve prints 85 billion every month for heavens sake. Every month. I dont know if it does any good. Probably not. Thats what they do. If you are a ceo and someone says to cut 2. 5 across the board. Or do you want to cut it in a way ta helps you grow . When it comes to the children in congress they have to take their medicine across the board. Thats the only way to do it. I hear my friend dean baker. I knew he would oppose. But deceased nobel Prize Winners would say Smaller Government is good for growth. Are they wrong . They preach Smaller Government. Are they wrong . No, no, larry. Have you heard of a poor person spending himself into wealth . It doesnt make sense. Whats good for the family is good for the national economy. A lot of Companies Borrow money to grow. You can if you have good expected rates of return. We dont have good expected rates of return. The tips is negative 70 bips . Thats a terrifying future. People dont have confidence in the government or they wouldnt lend at negative Interest Rates. I dont think thats what it is. You have a bad customer you lend them negative Interest Rates . In this case thats what happened. It is. Its the only place to go. The real customer is ben bernanke. Flut all the normal rules of credit and Financial Markets have been broken b because of the wild stuff bernanke has done. Art, thank you. Youre coming back later. Dean baker, we appreciate your point of view as always. Heres something i think is bullish. The state department make as good case for building the Keystone Pipeline. This is the fourth time they have made the case. The report released friday has the oil industry cheering. There are now no more excuses for delaying keystone, president obama. Later on the new forbes billionaires list is out. The list is longer than ever. I didnt make it. Billionaires are great. More billionaires mean strong, vibrant economies. Thats right. Free market capitalism should produce more billionaires. Im kudlow. Well be right back. Hey. Theyre coming. Yeah. British. Later. Sorry. Ok. Four words. Scarecrow in the wind. A baboon. Monkey . Hot stew saturday . Ronny hey jimmy, how happy are folks who save hundreds of dollars switching to geico . Jimmy happier than paul revere with a cell phone. Ronny why not . Anncr get happy. Get geico. Fifteen minutes could save you fifteen percent or more. The people of bp made a commitment to the gulf. , and every day since, weve worked hard to keep it. Today, the beaches and gulf are open for everyone to enjoy. Weve shared what weve learned, so we can all produce energy more safely. Bps also committed to america. We support nearly twohundredfifty thousand jobs and invest more here than anywhere else. Were working to fuel america for generations to come. Our commitment has never been stronger. All right. Were one step closer to finally seeing the full Keystone Pipeline become reality. Fridays state Department Report said Keystone Pipeline would not have a significant effect on the environment. So let environmentalists push back. The president has run out of excuses and its time to improve this thing. Here now is sabrina fang of the American Petroleum institute. My panel is still with with us. Is this it . Tu do you expect mr. Obama to sign this thing . Were hopeful, larry. As you mentioned, the report that came friday showed no Significant Impact from the pipeline. Its his fourth report in more than four years. We believe keystone should be built for the reasons we were saying. Energy security, jobs. The eis found out this project will be creating thousands of jobs. Thats what we have been saying all along. We dont have any idea why the president is delaying. Secondary and tertiary jobs would be a couple hundred thousand. Thats right. When youre through with the transportation and supplying. So what the state Department Said again, this is not new. No significant damage to the environment or no creation of greenhouse gases. They passed the nebraska test. We had government Dave Heineman on. Whats left not to like. Whats left not to sign . Well, thats a good question to ask the president. We feel all of the answers, all the questions have been answered. The environmental questions about nebraska. The president was concerned about having to answer. The governor of nebraska is for the project. The state Department Found no significant environmental impacts from the project. Its the same conclusion we have come to time after a time. The pipeline is thinking its the most reviewed pipeline in history and it needs to be built. This is a job project. It will create jobs immediately, directly with building the pipeline and indirectly with the lifetime of the pipeline. It will create job security for construction workers who are out of work. Their unemployment is double the national average. The pipeline needs to be built. We are hoping the president will come decide this is for the public. And it should be built. 70 of the American Public according to the recent poll support the pipeline. 16,000 good, high quality, perhaps maybe even union jobs come out of this. Directly. Im talking second and third. Right. The governors are for this. It there is no reason the government shouldnt sign it. Hes not running for reelection. The only reason the state department pushed back on this in 201011 is he didnt want to upset the environment. Your liberal environment friends can i get them on the phone please . Good man. The others you hang out with want to end all fossil fuels. They want windmills, solar. We dont want to walk. Youre going back to the 14th century . Exactly. There are concerns. They have valid concerns. You have to weigh those versus the economic positives. Theyre going to do it anyway. From their perspective this is furthering us down the hole where you are creating more damage. My perspective is when you look at the weight of this. It makes it difficult for them not to sign. One reason is we like canada. The state department. Who doesnt like canadians . The choice is they take this stuff out with the same greenhouse effects, put a pipeline to the west coast and ship it to china, help china and we import more oil from venezuela. Who is the winner . We dont have as much control over our oil independence. Youre right. Let me go back to is a bree that. Any estimates on when the president will make a decision . There is a Comment Period starting march 8 that ends the 22nd. The National Determination period begins. We hope to get a decision from the president. We feel all issues have been addressed with the pipeline as you have said. Many people have said. The public wants the pipeline. Its a jobs project. We hope the president will green light the project. You have to wait and see. Were with you, with one exception. Thank you very much. We appreciate it. Youre welcome. How close are we to the all time closing high on the dow . Well look at the bullish news from wall street coming up next. Its not what you think. Its a phoenix with 4 wheels. Its a hawk with night vision goggles. Its marching to the beat of a different drum. And where beauty meets brains. Its big ideas with smaller footprints. And knowing theres always more in the world to see. Its the allnew lincoln mkz. Otherworldly things. But there are some things ive never seen before. This ge jet engine can understand 5,000 data samples per second. Which is good for business. Because planes use less fuel, spend less time on the ground and more time in the air. Suddenly, faraway places dont seem so. Far away. The dow closing at its second highest level ever. Seema mody has the market numbers and more. Good evening. Good evening. The dow staging a comeback today closing at 14,127. Just 37 points from the 2007 peak. Modest gains for the s p 500 and the tech heavy nasdaq. Two of the biggest dow gainers today were walmart and home depot. That could be a sign of improvement in Consumer Spending and home depot could gain if the housing recovery takes hold. An Interesting Development between tech stocks. Apple down, not participating in the rally. Google closing at 821 a share. Another record high. In other news a potentially huge medical break through. A 2yearold girl was cured of hiv. She was on aggressive drugs since birth when her mother stopped the treatment. No trace of the virus was found. Millions of babies are born to infected mothers every year. While this is only one patient it could be a huge step. The u. S. Is giving 250 million in aide to egypt. John kerry pledging the money to egypts president Mohamed Morsy telling him the u. S. Is keeping a close eye on the situation there. As they should. I wish i knew what that meant. Let me ask jonathan. Transportation index. I believe it hit a new alltime high today. Whats that mean . Its positive. As a matter of fact, you know im cautious on the markets from my tone. The industrial sector has been doing well, not just for a month but for the last three months. Youre seeing weakness, unfortunately, on the Consumer Sector. The payroll tax and delayed tax refunds and gasoline are hurting the consumer at a time when t t that. Home depot is basically a consumer stock.