As more and more countries use coal in just five years, china will be the number one consumer of the socalled dirty energy, well talk about that with an environmentalist, also, we also have our eyes on washington, of course, lawmakers are on vacation, but there still is no deal on taxes. Nearly every american is going to have to pay more in just eight days if congress cant reach some kind of an agreement. Checking the big board right now, the Dow Jones Industrial average is down about 41 points. Again, weve got a half day of trading and we close today at 1 p. M. , so that traders can go out on christmas break. Light volume, but there are significant movers that well talk about in just a second. In particular, apple and jb penpejb j. C. Penney. We have Shibani Joshi and adam shapiro as well and first to nicole, j. C. Penney, a lot of people worried about retail sales, think its going to hit Companies Like j. C. Penney hard . Guess what . The stock is up 4 , why . Thats a huge move on a day when the major market average, look the at j. C. Penney, its posted comments from oppenheimer this morning, talking about the fact that promotions are working well and bringing traffic into john kerry opiniony, you know that we spoke about ron johnson and came up from apple and his whole theory, was no promotion and great prices all the time and that really was working. The and so, theyre back to the promotions this Holiday Season and its working. Traffic is pretty busy there. Its working very well, at least today for the stock. Thank you, nicole. Well, president obama has always promised not to raise taxes on the middle class, but if he cant reach a deal with republicans in the next seven days, thats exactly what will happen and adam shapiro, ive got to tell you, looking at the numbers, if the president gets every penny from the socalled rich that he wants to get, that would still only be 1 8 of the money that he needs to balance the budget. In very simple terms, its roughly 70 billion dollars is what it would raise, in a budget if the rates go up and another 20 billion, if you get rid of deductions, but hes increased spending 800 billion dollars a year. And to say that 70 to 80 billion in a budget thats 900 billion to a tral over budget. So doesnt add up. Where does the other 930, 920 billion where is it going to come from . Which is why, shibani, a lot of people say, maybe he wants to go over the fiscal cliff because he cares about maintaining that level of spending. He doesnt want to decrease spending, he wants to keep it where it is and the only way hes going to get that kind of money is by hitting everybody. Not just the rich. Well, and to some extent youve got to wonder, what is the most fiscally responsible thing to do . To some extent falling over the cliff will force everybody to do the hard work thats nncessary, just raising taxes is not going to be the full is not going to do the job here, we talked about the difference that already exists between what is needed and the amount that were spending and i think sometimes youve got to really twist the knife in here and maybe falling off the fiscal cliff will get us to do the really hard work that needs to be done. Adam, in the recesses of your most con spear tospicon con spespir conspiretorial mind, people are going to lose jobs if we cut Government Spending and nobody wants to lose jobs. On the other hand they all know, by them, in washington there has to be cuts and its easier for them, its the conspiracy talking. Whats wrong with going over the cliff. Such wonders and the world is not going to end. , but you and i have jobs and some people will lose them. Some of them. It will force coping to make the hard choices we need to make. David hold on a second though. The one, the only thing that could raise revenue significantly is growth. I think everybody, republicans and democrats, one thing they agree on is that growth. That could increase revenue by hundreds of billions, not just tens of billions, and if everybody gets a tax increase, shibani, will likely go into recession in any well have negative growth and that will mean even worse of a deficit. If you start to cut spending youre going to cut jobs. If you raise taxes youre going to cut jobs. At some point weve got to say were going to do whats best for the longterm picture and either way were going to take a shortterm hit for longer term, more , but you could do it with less pain than what congress is about to deliver. You can put in spending cuts that the markets will appreciate in a longterm plan, as opposed to its not about the market. David bottom line, what we need are jobs and growth and tax increases are not the way to get there. Gang, thank you very much. Well, coal imports in china were up almost 30 as the price of coal continues to plummet. The iea says that china will be number one in coal consumption after the Chinese Government said they would use more renewable energy, but coal will account for about 70 for the countrys energy for the next five years. Joining us now is rob deans, how can they get away with this under the kyoto protocol . David, theres inescapebly keynesian you and i talking about goal on christmas eve. And the nightmare in china, the biggest polluter on the planet. David but theyre not a part of kyoto, thats the bottom line. What china is doing, china recognizes it needs to cut the mercury, corps bohn tarbon out improve efficiency and find alternative fuels, they are he burning, as you say, 4 billion tons of coal. And you burn two lumps of coal in the world, 1 2 is chinese, you have to do something about that. Ive got an answer for you. Okay. Ive got an answer and its something you may not like, but it is an answer and its a hell of a lot cleaner than coal, there are a lot more natural gas reserves in china and weve seen what fracking has done and how much has been plentiful. You may not like it, its a hell of a lot cleaner than coal, why not encourage it. Help them in any way we can to develop their natural gas reserves . You know, david, youre right. We are the two largest economies in the world, two biggest polluters in the world. The yoits and china have a Natural Partnership here for clean energy, were both investing about 100 billion dollars year together in clean energy. China and the united states. David hold on, bob, let me define what you mean about clean energy, a lot of people from nrc did do not include natural gas with clean energy, but do you . Well, what im talking about is wind, solar and other sources, but the key what about natural gas bob . The key to it, david, how we get it. It has to be gotten in a responsible way. We cant continue to put our communities, our ranchers, our farmers at risk and we cant continue to kick down the road the transition we need to make for the sake of our economy, for the sake of our National Security for the sake of our were not kick it go down the road. This isnt a fiscal cliff kick down the road. Theyre improving techniques all the time. Theyre not kicking the problem down the road. Most are. And those that arent need to be required to do so. We need to improve the public oversight. Right now they dont have to comply with our foundational safeguards, david. Like the clean water act. Safe drinking water. That needs to be changed so that all of these companies are fracking in the most responsible way possible. Let me put a fine point on this. Bob dean from the nrcd action fund is willing to go along with helping the chinese develop their natural gas reserves so that they dont become too dependent on coal. I think thats news. What were trying to do is to encourage the chinese to promote all kinds of clean technology. Weve had an office in beijing since 1995 and 30, 35 people there, we have good contacts in the government. Good contacts in the Business Community and were making a difference there, but what its about, is helping the chinese to improve their efficiency. David, their Industrial Efficiency is improved by twothirds since 1980, but theyre still 15 to 20 behind where they need to be. They are he going to get there in the next lets be realistic, youre comparing natural gas and wind mills, its going to be a long time before wind mills can get to where natural gas is. If we have to deal with a solution right now for the chinese to prevent them from spewing out all of that coal. 70 of their energy needs is coalproduced. If we want to switch to something cle something cleaner. Natural gas in the meantime. What china is doing, what no one in the history has done, hundreds of millions of people from abject poverty to the middle class. Its energy and effort unfortunately 70 is coal. And we need to transition away. Is there actually something we can do about the china situation . Half the problem we dont know whats going on inside the countrys borders, much less the ability to impact change. What can we actually get done there . I think, shibani, its a great question and has to do with a partnership. A signo American Partnership around Clean Green Energy technology. China is now the leading wind producer for electricity. More wind produced electricity in china than anywhere in the world. Were number two in the united states. We have a lot to partner on. David by the way partner with wilbur ross working with companies to get natural gas out of the chinese reserves. And there are huge reserves. Maybe you could work on a deal with him. Appreciate it. The n. R. A. s Wayne Lapierre caused a stir when he suggested armed guards at schools. Do we really need that . Do we need to put armed guards in the schools . Well ask a former d. E. A. Agent about that and well ask about a plan of his own later in this hour. The economy means one thing for retailers, slower holiday sales for the week ending 15th. Down 4. . Adam you have been looking at this. Part of it is Hurricane Sandy and part of its the tragedy from newtown, connecticut. David people are afraid to go out and shop . Theyre not in the mood. One quote in an article talk people think its better to spend time with family. Shopper tracker is finding that people shopping for the week that ended december 15th down 4. 3 . Overall theyve adjusted what they think the holiday seen will be. And theyve adjusted that it will be a growth of 2. 5 . And thought it would be 3. 3 . National Retail Federation is keeping their prediction of growth 4. 1 . Real quick, i dont know if we have the graphic available. If you invest in retailer, boy have the online retailers done gang busters and even the shopper track survey even online wasnt performing as well as last year. Overall this year for shopping, the online stock is doing much better. Meanwhile, j. C. Penney can we put up the stock chart, intraday what its doing . Its up almost 4 today. Does that surprise you . The brick and mortar retailers are up for the year. The online retailer, theirs is up. And once again, amazons, ebays, these guys are doing extremely well. You dont have to price check with amazon and you can do the Online Shopping and do it in five minutes. You go across the street and theres a gap across the street from this bill, our Building Location when i walked in this morning it said in big letters, 50 off at the gap. This is before christmas. I mean shall this is how bad these guys are hurting. And banana republic, 40 , 50 off throughout the year and the article in the wall street journal depending where you live, online retailers are charging and what prices you have, too. And weve got to go back to the markets, we always like to check apple shares, lets see how its reacting to news of googles new phone. Everybody thought, nicole, that apple would take a hit. Not so. This is very interesting. Apple is not taking a hit and google is slightly to the down side. Here is the deal. Iphone, ipad. How about xphone, xtab lert . Thats what googles motorola is working on reportedly accord sources looking at what larry page, the ceo is working on. And first, the xphone, which is meant to directly take market share from those apple and samsung, and then later, where theyve got a good Marketing Budget for this one, the xtablet. Shibani, youve been following the market, what do you think . I think this is a bigger deal from motorola versus anyone else out there. Motorola has lost its footing in the market and hasnt had a great phone in years and quickly, why is google down and apple up . Does that mean that the market doesnt trust googles . I think that this is a very competitive market and until we get the phone no one is going to make any folks, you have heard stuarts prediction, all the talk about climate change, devastating storms like sandy are just a prelude to a carbon tax. Will we get one . Thats next. Lets take a look at the big board. Right now the Dow Jones Industrials are down about 31 points, but theres very low volume today. Its a shortened trading session closing at 1 p. M. Of course the markets are closed tomorrow for christmas. So Facebook News now, the brokerage needham raising its price target on facebook to 33 a share and getting close to that 25. And the research in motion, behind the blackberry, worried after the ceo announcing new price structure and pay for advanced security, but other services would generate less revenue and microsoft hoping for a holiday miracle with new windows 8, but shares are down about 1 1 2 . This morning, in 90 seconds with the fiscal cliff coming, is a carbon tax also on the way . You thought it was gone, not so. Thats next. [ male announcer ] you are a business pro. Omnipotent of opportunity. You know how to mix business. With business. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or above. And still pay the midsize price. I could get used to this. [ male announcer ] yes, you could business pro. Yes, you could. Go national. Go like a pro. Well, weve already talked a lot the about it this morning. President obama cant raise enough money through his tax plans to cover all the spending. That means he could resume other ways for the revenue to come in. Will a carbon tax be among them . Joining us now from the American Action forum, sam, we know the president wants this thing. He tried desperately, even with Democrats Holding both houses of congress, however, he couldnt get it. Will he try to pursue it in his first year of the second term . Well, theres certainly a lot of revenue out there. A lot of projections are, if carbon is at 20 per ton of carbon, it could generate roughly a trillion dollars over the next ten years, of course, that figure of 20 would increase, but i think its pretty tough for republicans to swallow another trillion dollars in revenue from a carbon tax, so i dont think its very likely to get 60 votes in the senate or for Speaker Boehner from ohio which is a big coal producing area, which would be hit the hardest by a carbon tax, i dont think its likely he would bring that up for a vote. David here is another scenario though. The president knows how to maneuver and i think one way hell maneuver is go against some of his environmentalist friends. We saw one environmentalist saying he was in favor of china moving towards natural gas rather than coal. The president may sort of swallow his distaste for the fossil fuel part of natural gas in order to be able to tax it more. If he says go ahead, just frack like crazy and get as much natural gas as possible, but we, the government, get to keep a lot of at that by taxing it more, maybe hell go down that route. Well, it would benefit the Natural Gas Industry much more than coal because natural gas is half as carbon intensive as coal is. In order for a conservative to tolerate a carbon tax they would have to get revenue neutrality and they would want that trillion dollars back somehow, either through reduced corporate or payroll taxes and they would also want to rescind the epa current regulation on carbon. So you wouldnt want epa regulations on carbon and additional carbon tax. Sam, this is a little variation of the carbon tax and the president might pull the epa off natural Gas Producers a little bit and give them room to produce even more with a p proviso, and it would focus specifically on one section of the industry. Well, i mean, thats differently a possibility, but again, i dont see, for example, progressives ceding the ground on fracking, the epa had the rules and Land Management department of the interior is set. And i dont see regulatory pullback and thats what they would have to get at minimum. David sam, on the other hand the president knows how to take advantage of what he sees as sort of distractions in the republican party, as to whether john boehner keeps his job as speaker and a whole lot of questions about whether the tea party has been decimated by boehner, whether they rise up. The president may try to push something through real fast, what do you think . It would certainly not make things easier for Speaker Boehner, but i think there is incredible skepticism regarding a carbon tax in the next goround in 2013. So i think it would drive a wedge in the caucus even further, but i dont know that youll see a ton of republicans jump on board for a carbon tax. David no, no, you wont have a lot of republicans do it, but i think youll find the president pushing in that direction, maybe focus narrowly on natural gas production. Thank you very much. Sam, its good to see you, my friend, appreciate it. Thanks for having me on. Thanks. The president can pay for all of the spending just by raising taxes, so how will he foot the bill . Is a fat tax like the one that they have in europe the way to do it . A vat tax . A value added tax . Is that story coming up next. How do traders using Technical Analysis streamline their process . At fidelity, we do it by merging two tools into one. 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