Dagen the wonderful you have no idea where i am going. I can get myself into trouble. Connell yes you can. Dagen stocks now and every 15 minutes. Nicole the markets are pretty much spot. Lets start off with apple. The 700 stock back in the middle of september. One product after each other the price target is now 700 from 780. Not too optimistic on the iphone5. It is down 3. 5 right there. The vix, the fear index, is to the upside. The dow is higher while the s p and nasdaq are pulling back. Back to you guys. See you later. Connell thank you. After the big meeting they had last night, the speaker of the house, john boehner, is heading home for the weekend and ohio. Dagen rich edson is following the action. Rich there are cell phone communication and airports in his area of ohio. He can come back if he needs to do so. Even after last nights 50 minute meeting with president obama at the white house, there still is no Significant Movement towards a deal on the fiscal cliff. They have a frank and open conversation last night and the lines of communication remain open. The major difference here between both sides is you have democrats wanting an Immediate Tax rate increase on families earning more than 250,000 a year, more revenue and more specific increases and for republicans, they are looking for more in spending cuts, more entitlement changes, more commitments of that nature from democrats and they are not getting that. You also have republicans discussing what amounts to a backup plan if the impasse continues and we do head towards the fiscal cliff and nearly every federal tax rate is said to increase. If that happens, what will the house of representatives due to lack if you do not have a deal by monday, you start, at least, procedurally, for getting this thing entirely. Conversations continue, but, still, no real progress. Dagen thank you, rich. Scott miner says it is greatly over stated. How is it overstated . Well, i think, at this stage of the game, the market already assumes it is not likely we are going to get a deal. Because they assume we are not going to get a deal, we are pricing for one of the worst case scenarios. If we just went off the cliff, at this stage of the game, removing that uncertainty from the market would result in a rally from the equities. I think it is a good entry point in the next few weeks. Dagen we were looking at the ten year treasury and the yields have gone back up. I have heard people say the yield should be at 1. 2 if we end up going over that live. You do not buy that, you do not think there will be a rally and money coming out of the stock market, in addition to what we have rdc and . I think it is likely that we would get some sort of rally in treasuries. We will have some noise in here. You know me, i look at things over a twofive year horizon. You are being rewarded to take the risk right now. Equities are not where they should be. Take a stock like conoco phillips, it yield 4. 9 on a dividend basis. Johnson and johnson, which yields 3. 5 on a dividend yield, but its dead yield is 1. 5. These comparisons are just too compelling for so many income oriented investors. I think they will put money there. Dagen how it now use inflation, do you think we are maybe even closer to a serious, serious pop up and longterm Interest Rates . I think the fed, by virtue of doing what it did, has a lot more ambiguity in the policy it when they will exit. For instance, the forward looking expectation on inflation on 2. 5 , as being a policy guide, if it gets to 4 , the fed does not do anything, the expectation is it will come back down to 2. 5. All of these questions are completely out there to be answered as the events occur. At the same time, they took the certainty of shortterm rates staying at these low levels until 2015 off the table. The market dagen what if on a planet 6. 5 in the next year . I did not like what the fed did in a statement. It raises a lot more uncertainty. Dagen the fixed income guy who likes stocks. Good to see you, stop. Be well. Connell the gop needs to play hardball. Every indication is that speaker dinner and the republicans need to go down the road of higher tax hikes. You do not go she and public. You do not play your hand in public. Connell let me ask you what the other options are. I will not give in on these higher tax rates no matter what. The president says i won the election, we need them. I thinkkthe president wants to go over the cliff. The assumption that neither side wants to go over the cliff is wrong. The republicans certainly do not want to. The president , remember, he is an ideologue. Republicans will get blamed for that matter what happens. No matter what happens in this negotiation, they will get blamed for it. Instead of equating taxes with spending cuts which has been in the back and forth so far. They have to pay the higher taxes. In exchange for what . Usually the deal is some promise of spending cuts down the road. Future congresses are not really found to uphold. What they really should be saying, okay, you want to talk about higher taxes, we will put more revenue on the table in exchange for either real cuts or changes in the benefit formulas and eligibility for entitlement programs or termination of and power federal spending programs. Not just slowing the rate of spending. Connell are you one of those people that thinks boehner is on his way out . Do you think he will hang on . I think if he gives in, he has a very serious problem in terms of holding onto his leadership. Nobody wants Democrat Party and Democrat Party like. They want them to stand up, fight back. Dagen but you have a full report [talking over each other] dagen we lost the election. We did not win. He is in a tough position. He is getting and from all sides. Connell they want to give them. They are thinking about the next election. They want to get this out of the way. Start standing for something now. The reason why republicans keep losing these National Elections is because they are not willing to stand up. By the way, the republicans also retained control of the house. They did win that part of the election. American people want the republicans there. Dagen everybody will be bad when they say everybody will be bad when they see the payroll taxes. Connell thank you, monica. Dagen the biggest story in 2013 will be iran. Connell the tech pioneers, john mcafee, he has been in the news for all the wrong reasons lately. He is back in the United States. Plenty of mystery. Dagen where you may find your next twinkie. Walmart may be the only place you may be able to find them. Take a look at the oil market. Completely unrelated to twinkies. I guess they are not made of crude oil. [ laughter ] connell market now. Nicole petallides a quarter past the hour. Nicole lets kick it off with best buy. Talking about the founder possibly moving forward with a buy offer. Now the author has been pushing back. With that deadline pushed back, it means this deal is not happening imminently. The 16 gain that you saw yesterday, it was a raised by the almost 16 loss that we are seeing today. That rings me to general electric. Raising dividends. The bad news for the shareholder is it will not be moved up to december like so Many Companies like caterpillar and mason. They are also authorizing another buyback. Back to you. Connell it is time. Lets bring in charles. Lets talk about caterpillar. Charles i like caterpillar. This will be one of my 2013 and investments. I have always liked the company. It is extraordinarily wellrun. 20 of the revenue comes from outside of this country. It always feels a little myopic that we are always talking europe and america. This company has exposure to the global economy. What triggered it today was this china pmi number. I know gordon chang has been on. Dagen yes. We were there. Charles a lot of people do not believe the china story. This number to me tells really nice with other things. Dagen most people already own it in their 401 k . Charles you are absolutely right. The stock is down pretty big from where it was. This last quarter was a disaster. North america construction was up. Almost everything should go up next year. I love the risk reward on this. Connell this will be a huge story whether china is about two, you know, come back or collapse. Charles a minimum of 8. 5 next year. We would take it in a heartbeat. Dagen deceleration is dangerous even if you are still going at 8 . Connell thank you, charles. Appreciate it. Dagen we are. On saturday morning. Connell umbrella. No changes to the tax structure. Dagen more on the impact of the fiscal cliff. Women are worried about it. There will not be spending that much on it on you. They will probably be spending it on themselves. 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I have your fox news and eight at 23 minutes past the hour. A shooting at an Elementary School in connecticut. The government is dead. There are reports of a second gunman. Emergency crews are on scene pending to several injuries. State police are telling us they will hold a News Conference at 1 30 p. M. Eastern time. Protecting the nation from a potential syrian missile attack. Two batteries of patriot missiles and a force of 400 u. S. Soldiers. Leon panetta did not say how soon they will be deployed or how long they will stay in turkey. Back to dagen and connell. Connell the state of oregon has gone to Great Lengths to please nike. The governor asking for authority to ensure that the Corporate Tax structure will not change for Companies Like nike nike threatening to move its headquarters out of state unless organ can guarantee it tax structure will not change. Students are not the only ones with college debt. In effort to appeal, they end up footing the bill for all of this. According to moodys, debt among colleges was 205 billion outstanding. Also reporting harvard has the most debt of any private school in the nation. You may be disappointed, guys, by the gift your significant other fires you for christmas. Dirty 1 of women planning to spend less this year than last. Only 19 of men pulled will spend less. It finds the looming fiscal cliff deal weighing on shoppers minds. Here is our conversation, part of which i posted on twitter. Men have to spend more money on women to shut them up. Connell there is not enough money in the world. [ laughter ] dagen to not laugh at him. Do not encourage him. Connell lets keep going. Dagen really . We have to move on. Oh, lord, have mercy on my soul. The world will have no choice, but to deal with this looming Nuclear Threat in 2013. Connell the story of the year. Surrounded by rumors, murder and drugs. The computer wizard, john mcafee, he avoids deportation from one of mullah by popping up in miami. It is just beyond. But first, all market now, some winners today on the s p 500. Connell we are back on market now. Lets bring Nicole Petallides back. Nicole we will bring you right over to the post. It is down about 12 . The fourthquarter profit 86 . Not good news. A downbeat first quarter. Missed revenue guidance in the latest quarter. When you think of verifone, one of their main objectives that they make credit card readers. These are some of the jobs that are under their umbrella. Not a good quarter, not a good outlook. The nasdaq composite down about. 5 . The dow also to the downside. Back to you. Dagen he must be making his daddy proud. Not only getting the countries first longrange rocket up in the air, without disaster, he has now 1 of the year, the online poll. He the out jon stuart, Gabby Douglas and even, chris christie. Just another award for the leader. Connell this is real, right, the story that we just said . The onion had a fake story. From that [talking over each other] connell this could be the last day. [ laughter ] dagen i am kidding. Connell no you are not. [ laughter ] connell kim jong un, the sexiest man alive and next year is the year of iran. Dagen joining us now is senior geopolitical strategist at barclays. The problem is if we do not get a deal, june or july, iran may reach breakout territory. This is coming to a head quite quickly. Connell lets talk about what we do in the United States about that. How these geopolitical events and drugs affect that. I think we look at what we saw over the summer. The market says we see an off ramp. If it does not materialize, we are in for a nasty shock. He will be reelected. The question is if he gets a huge majority he is protecting israel from the threat. He put himself in a bit of a corner. Connell do we have options, the United States . This that made things tough for the irony in. The sanctions are actually starting to leak a little bit. Is it difficult enough to force them to abandon their Nuclear Ambitions . Probably not. Dagen acknowledgment of the rebel group in syria, do we go further than just that given what we know or do not know about those rubbles . Is it too late to change the outcome . We are picking the rebel side which we think represents our interest. Will they be the ones in power . You look at the recent military gains, the group that has been the most successful is kind of the extremist group. That is a real problem. Connell it is always great to have you on. Thank you so much. Dagen we love having you on. We always learn so much. Happy holidays. Thank you. Thank you so much. Dagen mcafee back in the United States after a month long run from belize police. He is currently soaking up the sun in miami. We just spoke with john mcafee. He went back into the hotel. Prior to his arrival here, this building was featured in the movie scarface. Mcafees status is a free man here in south beach. Down in believe, his legal status could get a little more complicated. A man was killed in early november not too far from the mcafee apartment or house where he had been living since 2008. However, at this point, the fbi is not involved. As far as mcafee is concerned, he does not anticipate it ever to happen. However, he is now waiting for his two girlfriends. Two women that were down in one of mullah city. They are waiting for entrance papers from the state department. They are now both legally in guatemala. I just do not know right now. Yesterday, this 67yearold billionaire, software, formerly retired software tycoon, revealed he has some ink on his back. An extensive tattoo. The people that are spotting him, having recognized him for being on the news for the past several weeks, they are all posing for photos with him because he has become the latest reality celebrity. Dagen that is a trip to crazy town right there. Thank you so much. I love how you worked in a scarface reference. Thank you very much. Connell people losing Holiday Cheer when you start speaking to them about the economy. Confidence is down heading into the new year. Dagen walmart is ready to roll out some cash for what is left of hostess. Twinkies, snowballs, you name it, we will tell you. 1. 7 on the ten year. A little higher than it has been. Im adam shapiro with your fox business brief. Consumer prices fell last month for the First Time Since may. Even with novembers the client, this placement at the consumer level is still up. Nearly 2 from the same time last year. Posting the sharpest increase in two years. According to the federal reserve, output rose 1. 1 . Two companies are trading higher today thanks to goldman sachs. Tivo stock is jumping after being initiated with a fire rating. A price target of 15 a share. Marathon oil also getting a boost. Thirtynine dollars price target. That is the latest from the fox business network. Giving you the power to prosper. [ male announcer ] where do you turn for legal matters . Maybe you want to incorporate a business. Orrotect your family with a will or living trust. And youd like the help of an attorney. At legalzoom a legal attorney is available in most states with every personalized document to answer questions. Get started at legalzoom. Com today. And now youre protected. Connell look at these numbers. A lot of pessimism coming out on the economy. 49 of people think the United States economy will be better a year from now. It is down from 53 in 2011. Senior economist from wells fargo is here with us right now. How much does this matter . Well, it matters when we see big changes. It signaled that there is a pullback in attitudes. If folks are more worried about the economy, they are less likely to commit to major purchases. Right now, i think, it is really a situation where we will get past christmas and that is when i think folks will really focus on the fiscal cliff. If we do not get a resolution, i think it could really cut into spending in the early part of next year. Connell this fiscal cliff talk and countdown is so painful. It came up yesterday, they do this every time in washington. It gets to people after a while. Regular people who just hear about it. Even if it does not affect them that much. They just start to think, the government cannot do anything right. Say they do. Say they cut a deal. They come up with some sort of fiscal cliff solution, if you can call it that. What does the economy look like dead . I think that regardless of a solution, i think the economy will pick up. It is like a speed trap. You will slow down to some ridiculous slow speed when you go through that town. Once you know what the rules of the roads are, you will come back through a little bit faster. Connell what are the things that we are doing right . Well, the one area that is really picking up is homebuilding. Homebuilding will do better. It will do better next year in a ma