Every single report that came out last week with either bad or devastatingly bad. Stuart you are right. You got that one right. Our time is up. Here now is dagen and connell. Dagen you are all the pressing. Connell know. Thank you, stuart, for that. I am connell mcshane. Dagen i am dagen mcdowell. The first year of a second term president is historically bad. Which is it . Connell i told him we have a bone to pick with him. Fha could make your life that you brought to buy your next house. Spew forth the Federal Reserve act. Another example of the online war putting your money at risk. Connell judge Andrew Napolitano is here later in our. Dagen top of the hour. Stocks every 15 minutes. Nicole petallides. Nicole 40 points away from 14,000. The dow is down right now about 20 points. We had some volatility. We had 100point moves basically three days in a row. Yesterday, obviously, we have been on the move. The dollar is stronger. Disney setting an alltime high. Hewlettpackard, 3m, disney and cocacola are helping. United healthcare coming under some pressure. The drug index is to the downside. The banking index has been stronger. We will continue to watch the highs that we set recently. Connell we will move to our first guest. It is sam stonewall sam stovall. We need you, sam ellis today to pick a cliche. It is not that the first year is out bad that it is just better than the year before. As goes january, so does the year. The remaining 11 months of the year and up 84 of the time since world war ii. Connell i think that this brings up a larger point. We are close to these alltime highs. How do you tell the difference between signal and noise . There is so much noise out there. You say just because the afc won the super bowl the markets will do this. Which one do you listen to . That is correlation without causation. Connell how do you connect the dots with that . What kinds of questions you ask yourself when you hear something happen . I think history is a great guide. It is never gospel. Second what i say is you have to overlay history with the current outlook for the economy, fundamentals and technicals. While history may frequently rhyme, sometimes it forgets the words. Connell mentioning the dow around 14,000. Apply it to the present day with the question everyone seems to be asking us, the market ran up so much that did i miss it . I think so many people have been waiting for a meaningful pullback since october 2011. They have not gotten into this rally and, basically, they have been left behind. Connell they should get it now . They should chase it . Chasing is the wrong word. There is a 50 discount to the average since 2000. Over this entire secular bear market, we are still looking at valuation pretty cheap. Connell the stock market looks pretty good versus bonds. 14,000 on the dow. It is a psychological level. Connell great to see you. Thank you. Dagen now on the latest on the online attack on the Federal Reserve. And internal fight was breached by hackers. They say it was a brief attack. They were not able to hurt the critical operations of the Federal Reserve. There were reports that the Group Anonymous published private information. We will bring you more information on this story as we get it. The debt is scheduled to fall to 845 billion. If Congress Fails to make any changes to our current financial situation, the nations that could hit 77 of our economies size gdp by 2023. Douglas holtzeakin joins us now. Should we be worried about the Federal Reserve in and of itself . Look, the fed has been the biggest buyer of treasury debt now for several years. It will be able to stop its extraordinary ontario policy as soon as we get our fiscal policy in order. Taxes are nearly at their highs. We will have a trillion dollar deficit. Dagen dont you think that the democrats will continue to fall back on raising taxes even more than they already have . It is nothing compared to the 7 trillion in additional debt. This is not a solution to our problems. I think they have used this to great political advantage. That is indisputable. That is not a solution as to where the budget has to go. What will the Senate Democrats put in their budget . What will it look like . They will not be able to raise taxes and solve the problem. The taxes will not work. They do not want to reform entitlements. Dagen there is a growing chorus among many people in this country that our debt is not that much of a problem because we have had these low, low, almost record low Interest Rates at this point. Ultimately, if the fed decides we are worried about inflation and begins to withdraw some of this money out of the system, will that be the day of reckoning . That will be a very bad day if it happens. You are hearing democrats say we have made a lot of progress, we just need to do a little bit more. Connell do you think you could still put it to the next president . The deficit will go down as the economy recovers. It is slowly doing that. I could see a real effort to make that happen. Dagen dog, it was great to see you. Better in person, but we will take you by a remote. Hope to see you soon. Their practice and abuse on your money. Connell the president newest candidate nominee. Dagen thinks there are some positives regarding this nomination. Monica crowley, who is coming up, apparently, does not see them. Both of you will have a chance to explain yourselves. Dagen i want a chance to get ahead. Connell it is all straightahead. Oil is that any 6. 73. We will be right back. Connell we are back to talk about this explosive congressional report. Medicaid funded now for profits in the state of new york are hauling in some bigtime salaries. One ceo pulling in 2 billion in 2011. Dagen Monica Crowley joining us now on set. Why is this happening . New york is the medicaid capital of the nation. Corruption is deeply embedded in the politics here. Frankly, the salaries are atrocious and a mere drop in the bucket compared with the billions of dollars spent on Inappropriate Services such as town cars to go to a doctors visit, Grocery Shopping services, 4000 a day. To residential facilities, none of which bore very little of which ever benefits the patient and even the anonymous payment for Services Never even rendered. The reason this goes beyond new york is that the system is rigged for corruption. Medicaid to politicians is not a noun. It is a verb. For every dollar the state spends, the federal government spends you another dollar. I will give you a dollar for every dollar you spend, would you be in trouble . Connell you would be in trouble. States should be on an allowance. Connell the intention to get more money to spend on things that will help. Though fraud takes over. The politicians figure out ways to spend his money and keep collecting more. Unfortunately, under the new health law, it will get worse. Many states that are joining the medication expansion will be getting nine dollars for every dollar that they spend on certain medicaid recipients. Medicaid has been around for decades. The checks and balances have not worked. Dagen as you point out, there is no incentive to really do that. They know that even a gravy train can crash. Dagen that is what it will take in order to shrink medicaid. The money that is pouring into these inappropriate salaries and other wasteful spending is coming from their own resources. When you waste the money, your kids do not have the money. Dagen thank you. It was good to see you. I want Grocery Shopping services. Connell lets go to Nicole Petallides now. Looking at zynga. Nicole we will start off with zynga. Look at the stock here. Jumping bigtime. Earnings easily beat the street. The stock is up about 9 . A big move here for zynga. It is directly tied to facebook often. Today it is all about zynga. I wanted to also take a look at shutter fly. Shutter fly is getting a new 52 week high. The stock is up 19 . They did see their Holiday Season do well. They peep the street with their numbers. It is 40. 02. A whopping 19 gain. Connell thank you. Dagen sally jewell. To run the interior department. Is this good enough for Monica Crowley . Connell do you want me to answer that now . Walt mossberg is back this week talking about the Microsoft Service pro. He will let you know whether it is worth your time and money. First, what do you think about how the currencies are faring right now . We will be right back. The local 21 minutes past the hour, i have your fox news minute. Boy scouts of america will delay whether to ban gays. They have declined in late 19 . French president says france may pull troops out. They have given Al Qaeda Linked rebels out of cities. In fort lauderdale, a bakery truck slammed into a pillar and was hanging off a highway overpass during rush hour. Rescue crews pulled the driver out, but one passenger died. The condition is not yet known. Those are your headlines. Back now to dagen. Dagen thank you very much. President obama said to nominate Business Executive sally jewell to run the interior department. Connell as we welcome Monica Crowley, my only goal is to try to get monica and dagen to yell at each other. Monica will start. She is here to argue, i think, this is a bad choice because president obama is making it. She is a top Business Executive. She has an energy background. She has a lot of experience that i think could come into play. My only problem here is that even some of the most impressive people who have served in obamas cabinet and of being cooperative. Even the most strong willed and impressive people end up getting used as props. Dagen you are suggesting that this woman who ran the outdoor retailer, one of the best companies to work for and the country, that she is just a big old piece of plato and she will let herself get molded. They do kind of get chewed up and spit out. She is very strongwilled. She is incredibly impressive, do not get me wrong. She does not have a whole lot of experience in government. Connell who are you talking about specifically, by the way . They do serve at the president s prerogative, obviously. Connell who is different after serving in the administration . Hillary clinton who is the most strongwilled and came in with the most independent portfolio, even she kind of got coopted where she did not have an independent power base where i thought that maybe she could enjoy. Barack obama made sure that she could not enjoy that. Every president sort of does this. They need to control their agencies and their people. [talking over each other] i would love to see her come in and argue very powerfully, to the president and others in the cabinet, for expanding drilling, federal lands for fracking, i would love to see her make some very powerful independent argument. Dagen wanted it be impressive if she could balance it and prevent them from taking away what we already have on federal land . Wouldnt that be fair to say . If she could just keep the status quo, isnt that a good thing . I would say so. You know, she has some National Allies in the labor region. She can make in employment argument in that regard also. If she can prevail, then we know she will have done a good job. Connell well done, dagen. I think you got her to come around to our side. Dagen are you mocking me . Connell no. Thank you, monica. Have fun on the radio this weekend. The Monica Crowley show. Walt mossberg is coming up. He will let us know if you liked the new Microsoft Service pro. Dagen say goodbye to the saturday mail service. Here is some of todays winners on the s p. Connell data hawks. The high demand for data with smart phone users. Mail service seems to be on its way out. We have the judge coming in. He will have some constitutional questions about the way president obama is using these unmanned drones. Dagen it is the bottom of the hour. Nicole petallides. Nicole i cannot believe, right, some things were great just the way they were. Turns out that the napoli will change one of the little guys that go around the board. The iron is out and the kitty cat is in after a month of voting. Toy robot, qatar, helicopter, diamond ring. It turns out that the Perfect Little cat moves in and the iron out. Save it. Maybe it will be worth something on ebay. Polo ralph lauren. That is about 7. 5 . The earnings beat the street. Retail sales have been on the rise. Margin sales have been improving. They plan on revenue to accelerate. Two very familiar household names. I do not know what you guys think about the little game pieces that go around monopoly. Connell thank you very much. A little technology now. Microsoft service pro hitting the store shelves on saturday. The important tank today is that once review of it is in. Dagen Walt Mossberg is here from the wall street journal. I gave you a huge shout out earlier. It was really painful because i yelled. It is awesome to see you. As always. About this service pro, you do not like it as much as the original . That is right. First of all, thank you for the shout out. The surface pro, they brought out the surface in october. It was a tablet with a little bit extra. The extra was they built in word, excel and powerpoint. You could not run regular windows apps. This surface pro runs a full window app. They are trying to be a tablet and a laptop. They did not do a great job of either one. Let me just give you an example on the tablet side. First of all, the minimum price you can pay is 899 for this thing. It weighs 2 pounds, which is about 40 or then and ipad. If you want to use it as a laptop, you have to get an addon keyboard. That adds another 130. The battery life, in my tests, was just under four hours compared to ten hours for the ipad. It is just, and on the base model that has 64 gigabytes of memory, only 30 gigabytes of memory is free for you to use. The rest of it is taken up by windows. Connell just combining two pieces of technology. The idea of being able to do that. We used to have separate devices for a lot of different things. We all like having music on an mp3 player and that we combined it with a phone. In some cases, it does not work. Will anybody be able to come by just about everything we like to have with us in one device or should they not even try, in your view . It is a great question, connell. Email is a good example that has moved over. Twitter and facebook, all those things. Tablet and smartphones do those things fine. What they do not do is have the productivity apps. On and ipad or in android tablet, you can certainly modify or review a spreadsheet. You can even technically create one. It is not a great environment for that, though. All of the hardware guys are going through certain jujitsu trying to make things slip and twist and, you know, work as both a tablet and laptop. Windows eight combines a tablet interface in the regular windows computer interface, pc interface that you have been used to for many years. I have not seen one that i think really does the job well. I do not think that this one does and i do not think the ones that are laptops that kind of flipped around to be a tablet to either. Dagen built these executives read your column, walt . Dont they know that if they put something out with large battery life in ways more than the heaviest ipad that it is extremely costly with a keyboard will be 1000 or more, dont they know that that will not work . Particularly in your eyes . I think that it is good. If i were a microsoft shareholder, i would want them to be trying to push the boundaries and do these things, but, i think, if you look at some of the other reviews, they are all pretty much similar to my conclusions. This particular product will appeal to some people. There are people going out and buying it as soon as it comes out. It does not pass my test for being either a great tablet or a great laptop. Connell that is a great test. Walt, thank you, as always. Walt mossberg. Dagen great to see you. Thank you. My old dell laptop that i had was like a suitcase. Connell i am sure it was not that long ago. Dagen it was in the 80s. [ laughter ] dagen no, it was not that long ago, actually. Nothing can stop the post office from delivering that but now that is only during the week. Connell that is fine with both dagen and i. They will in saturday delivery. Rich they have been asking congress to let them do this for years. The usps lost 16 billion in the last year. This is their attempt to try to get this back into line. This is what is in source for saturdays. No letter delivery on saturdays. Post offices will remain open. Package in po box delivery will continue. That will save about 2 billion. This is the first step to getting the usps back to even. We generate all of our revenue from the sale of postage. We take no tax dollars. We do not want tax dollars. However, we also do not have the ability to reduce costs in the way that a private business would. Rich the Letter Carrier Union does not like it. If he arrogantly thinks he is above the law or have the right to decide policy matters that should be left to congress, it is time for him to step down. There was a 50 billion Borrowing Limit to the Treasury Department and it has maxed that out. Back to you. Connell right now they are bleeding money. Thank you, rich. Rich edson. Before you do not respond. I call you and call you and leave you message. Phone companies are pushing smartphones. Data plans are going up bigtime. Connell some people are calling it the end of the personal computer era. Shibani joshi is coming up with one of the biggest stories. That is dell going private. I am lori rothman with your fox business three. Liberty mobile casts a deal to buy virgin mobile. The Parent Company of the Fox Business Network is new score. The debut raised 247 logan dollars in a initial public offering. Above the expected range of 18 20 each. 25 billion of songs sold. It received a 10,000 euro gift card. That is the latest from the Fox Business Network. Giving you the power to prosper. Tdd 1800345255