Show some guts. Tomorrow, rand paul with ideas for both parties. A francis is next im Melissa Francis and heres what is money tonight. Phil mickelson trying to take a mulligan for his comments on taxes. He will make drastic changes because of californias huge tax hike. What exactly does it mean . Is he moving . Is he retiring . Sportscaster jim gray is sharing hints from mickelson as he joins us. 2012 showed the biggest spike in home prices since the summer of 2006 but there is still time if you want in. Weve got the surprising inside scoop what is hot and whats not from coast to coast. Iraq stumbles upon a billion barrels of oil they didnt even know they had. We have details whether that could be a global gamechanger. Even when they say its not it is always about money melissa first lets take a look at the days market moment. A wild ride on wall street today. Stocks reversed courses in midday trading with all three major indices ending the session in the green the dow ended up 62 points. Travelers insurance reported Fourth Quarter results. The Company Still managed to post a profit despite increased claims from hurricane sandy. That is where the good news ended though. Travelers profit for the quarter was down more than 50 from a year ago. The stock though closing up just over 2 . Oil getting a boost today hitting a fourmonth high, closing at 96. 68 a barrel. Our top steer tonight. A superstar backing off comments he made about super high taxes. Golf halloffamer Phil Mickelson worth estimated 150 million bucks. Made it known the huge tax hikes in his home state of california will force him to make some drastic changes. Here is what he said quote. If you add up all the federal, disability, unemployment, disability and state, my rate is 62, 63 . So i have to make some decisions on what im going to do. Now mickelson is changing his tune a bit saying it was inappropriate to publicize his personal Financial Issues but he hasnt said he is staying in california. So will phil make a move . Will other athletes living in hightaxed states follow suit . Here with the answer is sportscaster and Fox News Contributor jim gray. And jim, i know you were texting with him. Why do you think he backed off this . Well, i think that he decided that tax and financial matters are personal matters and they shouldnt be out in the publics domain and he shouldnt be discussing what it is that he decides to do for he and his family and what what is best for him. He has taken the approach whatever he decides to do he will make his decision and will let all of us know. These are personal matters. Athletes at time have to discuss their salaries and discuss what it is they do because theyre so public. So he has decided this was a mistake and from this point forward he said at this time he will not discuss it any further. Melissa yeah. But when you look at the text of the interview, he made a number about comments. It wasnt just one comment. He sort of went on and on. It sounded like the frustration a lot of people feel. It makes a lot of sense. When you break it down and look at proposition 30 in california which raised the tax over a Million Dollars in the state. Jumped to 13. 3 from 10. 3 . He made 60 million last year. That means that he paid an extra 1. 8 million. I mean it is not chump change. I can see where his frugs station comes from. Do you think it would be likely that he and other athletes would make decisions where they live the based where theyre treated by the tax code . Absolutely i think so and i think that youre seeing it with companies as well. Melissa, it is even a Bigger Picture than that. You mentioned what he lost last year with the jump. He was okay with the threshold at 10. 3 . Perhaps when it went up 13. 3 it caused him and a lot of others to look at this. If he was to go elsewhere and his salary was reported directly at 60 million, and i dont know whether that is accurate or not. I havent seen his bank account and i havent asked him what he made. It is not my business. Melissa right. Just on the tax alone if he leaves california that is eight more Million Dollars a year. I dont know flip looking after his family and doesnt have to be here and income is not derived here but derived from all over the world and different corporations and sponsorship, he should seriously look like everybody else in business go elsewhere. A lot of people are going to texas and florida, particularly golfers and nevada a tennessee and washington where there is no state tax. Melissa they need warm weather to play golf yearround. A lot of places that would treat them a lot better. You mentioned texas and florida. One of the things he said strike as nerve with a lot of people he happens to be in a zone targeted both federally and by the state. You know it doesnt work for me right now. I am going to have to make some changes. As people see their federal tax rate go up. You cant do anything about that unless you are willing to leave the country and renounce your citizenship. You have to take a big step. We saw folks on facebook going public, some of those folks talking about leaving going to singapore. When you look at professional athlete, the one thing they do have control over what state they live in. And i wonder if you think, for example when someone is getting drafted and theyre deciding do i want to play for 49ers or play for a team in florida or texas . Youve been in the sports business for a long time. Do you think that people would make decisions about what team they would go play for based on their tax status . Of course they will. And thats why you see the migration away from california teams. When youre drafted you have no choice but when you become a free agent i believe in the future you will see guys going away from the Los Angeles Lakers and the clippers and the Golden State Warriors and the San Francisco 49ers and the raiders and the chargers. If they play in florida or go play in texas, that is 13. 5 raise automatically. With the salary caps in professional sports there is no way for them to adjust to give them more for the state tax. It is an automatic raise. Melissa i want to point out one other thing. Tiger woods within the hour came out and said that is the reason he left california in 1996. Not only does he like it in florida, one of the reasons but also a big reason is because of the tax circumstance. Melissa that is a great button on the segment. I didnt know that. That is perfect example. Weve seen tennis players go down to florida and lots of people. It is classic. California thinks theyre getting that extra 1. 8 million but they end up losing out on all the income because people just leave. Thanks so much for coming on the show. We really appreciate your insight. Good stuff. Thanks, melissa. Thanks for having me. Melissa so if you can put aside the debt ceiling debacle and the fiscal cliff fiasco there is actually hopeful news in the Housing Market. Cillo says last Year National home values rose almost 6 , nearly double the historical average. We havent seen annual gains like that since the peak of the housing bubble back in 06 but exerts say it will not last. We want to make sure our viewers on money dont his the boat. We have zillows chief economist, here in a fox business exclusive. Great to have you back on the show, stan. Let me start with why you think thi cant last. Great to be here, melissa. Yeah, definitely, to see 6 appreciation nationally first year after the Housing Market reached a bottom is somewhat unprecedented from what most economists were expecting given the high foreclosure rate and negative equity rate. The negative equity rate is contributing and price spikes. People cant sell their houses even though there is new demand moving into it. The only way markets respond is by the price spikes. Thats why were seeing price spikes above 22 in places like phoenix and above 14 in las vegas. Were definitely seeing some extraordinarily positive price appreciation in markets right now. The trouble is that it is not really sustainable. At some point the negative equity will erode. People will put their homes up for sale. We should see more supply in the marketplace. Melissa yeah. Also, existing home Sales Numbers were out today. That showed a little bit of a monthovermonth decline although yearoveryear it was much better. There is so much noise i feel like it is conflicting. Right now you feel like were definitely on the up swing overall in housing would you say . Yeah, i think generally were pretty optimistic about the trajectory of housing right now. And, you know, you do have to in terms of home sales being down between november and december, that one percentage point blip is better to look at longer term perspective what is happening yearoveryear and yearoveryear, throughout the, throughout all of 2012 we saw 12 to 15 more demand than we did the prior year. So demand is definitely returning. In fact, in a lot of parts of the country we have, were seeing inventory constraints and thats why were seeing new construction start up in earnest in a lot of parts in california. Melissa sure. Were looking the a map right now that shows where some of the strongest and weakest places in the country are right now. Before i get to where you think the opportunities are, where do you see the strength and why do you think that is . Looks like a lot of places that were hard hit like florida and california . Yeah, that is definitely the common denominator, places that were really hard hit. Think florida, arizona, nevada, california. Those places where youve seen enormous resets in home prices. Those are many is places responding the best right now. That is because affordability is alltime highs. Prices reset in some cases more than 10 years. Pair that with Mortgage Rates which are well below 4 now. It sets you up for historic affordability. Melissa talk to me about where opportunity still exists. I hate when i hear about where i missed an opportunity and there is no, way to get in and make money for myself . Well, i mean essentially, you know, if youre thinking about getting in the market and youre already in the market then the best time to have gotten in would be nationally at the bottom which was october of 2011. So essentially youre already a year past that. Melissa i dont want to hear about that where is there still opportunity . You think you expect new york, atlanta and chicago to rise . You think there is still good opportunities there . Thats right. Of those three, new york, chicago, and atlanta those are interesting markets because theyre ones that are still seeing home price depreciation in many parts of those markets and are definitely the laggards of the top 30 metro. Those are praises where the home market, the Housing Market is not yet fully recovered. We still have a lot of foreclosures and a lot of negative equity. They will do quite well. They will do okay in 2013. They will do better after that. All three markets. At least chicago and new york are a little more, have more headwinds and theyre in, they have a lot of judicial forechrous sure, processes which means there is a long pipeline of foreclosures. That tends to cloud the markets a little bit. Melissa why are you so positive on atlanta . Well, atlanta i would say has had a very long housing recession. It has been a little bit of a sleeper in terms of hard hit markets. Typically we talk about vegas, phoenix, miami, stockton, california, but atlanta has had a very long and hard housing recession. If you look to prices at historical levels in terms of incomes and rents atlanta is looking pretty good. I think atlanta had a lot of Bank Failures in the state of georgia and they have a lot of foreclosures but steams investor activity is moving out of phoenix and vegas and moving to atlanta. Melissa thanks for coming on. We appreciate your time. Good stuff. Thanks for having me, melissa. Melissa tomorrow is the big day, the house vote on extending the debt ceiling. There is a catch. That means lawmakers wont get paid unless they actually pass a budget. I love it our panel joins us with their best strategy and the outcome for both the market and the economy. Dont go anywhere. More money coming up. Officemax can help you drive supply costs down. And down. Use your maxperks card and get a 10ream case of officemax multiuse paper for just 4. 99 after maxperks rewards. Find thousands of big deals now. At officemax. Girl dont look at me. Second girl your hairs a bit frizzy today. Aw ha ha you should pick that up. Announcer every day, kids witness bullying. Poor you. Ha ha they want to help but dont know how. Teach your kids how to be more than a bystander. Visit stopbullying. Gov. Lori all right. Back to business in washington now republicans hold a big vote to whether or not to extend the debt limit until may. If congress doesnt pass a budget by april 15th they no longer get paid i have no problem with that. Our panel is here with their take on the strategy. We have our favorite economist, peter morici. The always amazing scott martin, chief Market Strategist with united advisors and former democratic congressman and brand new Fox News Contributor. Dennis kucinich. So glad to be here. Good to be with you. Melissa i will start with you, since youre brand new. What do you think . Is that a powerful motivator that they will not get paid . This issue of the debt is something that congress dealt with 52 times since 1978. It is an obligation to raise it because we have to cover the spending that already has been accomplished. Now, keep in mind that the millionaires in congress wouldnt be hurt by such a proposal. Melissa no. There are plenty of millionaires but the people that depend on a paycheck, i dont think that we want to start a precedent where we startlinging members votes to how they vote on a specific issue. Thats a very dangerous thing. But, look, should we do something about spending . You bet we should but the debt limit is really the wrong place to have a debate where you start to defeat the countrys economic position. That seems like unrelated issues. Before my banker would give me more money or before American Express would raise my credit limit they would want to know how i plan to live within my means in the future. They are related but im saying that we have to take in context where we are right now with our economy. Our economy is just at the threshold of a recovery. This would, markets would react what were doing. Melissa okay. We would see unemployment continue to be a major factor. And when you look at the trade deficit we have, which peter morici more than anybody has tracked, we, we have issues dealing with our economy. We arent dealing with. Spending should be. Melissa absolutely are. Dont go putting us in the tank here. Melissa what is the best outcome for the economy with the debt limit debate . We certainly have, the dennis is right they have to raise the limit right now. However, i think that linking the next extension with passing a budget is a good thing because after all, how much you raise the limit is going to be a function of how much you intend to spend more than you take in. And so, we do at some point have to get to disciplining spending and linking it to how much additional we borrow. I think that is a reasonable thing to do. So i like the strategy of, you know, may 1th. 19th. That said, we really cant reduce the deficit a lot unless we do something about our budget deficit. You see, the trade deficit. The trade deficit detracts from demand. The budget deficit adds to demand. If youre going to reduce that addition, you have to reduce that subtract sun. Melissa i dont know. Seems like weve got to stop spending. Scott martin, bring you into the discussion. What do the markets want to hear . That is the crazy thing the markets want, spend, spend, spend. If you were an alien looking down on markets and economy and look down on the markets and the debt ceiling you saw every time we extend the debt ceiling the markets pretty much went up which they have done last several times, you would say, okay, this is how we get the stock market to go up. That is crazy thing. Melissa why, why . Why does that happen . Is it that people trading in the market cant see we will ever have to pay this bill down the road . Why does the market rally when this happens . I think it is twofold. One of the things that happens, melissa, it absolutely destroys the dollar. If youre an s p company trying to sell your goods overseas it actually helps you that the dollar goes down in value because the foreign purchasers have more purchasing power to buy your goods. You but it is a dangerous game to, well, lets pass the debt ceiling extension but deal with it the next time. We were here in august of 2011. We had the gang of six, we had the supercommittee, all these smart people that were supposed to come up with a resolution how were not getting back to this spot and guess what . Were here. Melissa absolutely. Dennis i will kick it back to you on that one. Everyone thinks this sound like, i dont want to say it is, such a cliche, kicking the can down the road again. We have to deal with this, this is wasteful spending. We have an element no one is talking about i want to introduce on the show. You have exponential growth of debt due to compounded interest. We have structural problems the way we handle our money system. This is something that were going to have to address sooner or later. You can kick the can down the road but well still have debt. We have to deal with the underlying issues how these debts are created. Cut the wasteful spending but also look at the, at the system that we have that causes the debt to grow exponentially because of the come pounded interest. Melissa peter, im worried were in real trouble here. Seems like were not tackling this problem. We are in real trouble. Were to the point where raising taxes alone will not put us in a position where we can get our debt and deficit growth under control. You know if we raised everybody taxes by 25 , we wouldnt raise enough taxes to solve the deficit problem but yet we throw the economy into a terrible recession. By first principles, you must spend less money. Melissa yeah. This goes back to not dealing with the structural problems that are causing the economy not to grow. Melissa right. We could go down that whole litany but the president s speech yesterday was surely not about growth. Melissa yeah, thats true. Guys, thanks so much for coming on. I wish we had more time. You guys didnt get to talk enough. Well have to do it again soon. Thank you veryymuch. Melissa coming u