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Bedford Oak Advisors CEO Harvey Eisen and Moody’s Capital Markets Chief Economist John Lonski on efforts to avoid the fiscal cliff.
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Well joining us now John Lonsky chief economist for Moody's capital markets Harvey Eisen chairman CEO of Bedford oak advisors.
John.
An exhilarating day in the markets would you say yes and I think the market of course is becoming increasingly concerned about the possibility of going over the cliff.
But of course markets are still Detroit struggling to figure out what -- tax rates are gonna look look like for next year.
And -- we're watching.
Positive one positive report after another on this economy and we we couldn't have dreamed of anything this strong six months ago.
And and today -- for the first time was utterly dismiss because of the quote and quote fiscal quit and if you -- the the Boehner backed what.
On plan B.
Yes and what do you think's going to happen from here well we tied to this this -- now.
Offshore.
I mean that that's all anybody talks about and they're applying it to be eleventh hour fifty ninth minute and the Smart guys that I know.
Tell me that it'll probably not get -- but then they'll get done in the first or second we maximum in January.
And the stock market showed you just gave you a little bit of the pace today that the stock market feels it.
There is that listen to the president today and we art holdings going to be speaking opera Y years from Andrews I -- -- -- communicate his his take off was seven.
I'm sorry.
Where we.
-- the -- there's a plane and and that of course picture being worth -- 101000 words.
I was about to say we're -- the president which is rather obvious -- the spirit Air Force One is waiting to wean its way westward to Hawaii.
This is not a president who is overwhelmed by his failure to to lead on this issue.
It does look like it's now his issue doesn't.
Every Boehner has blown it's over now you know -- Harry Reid mr.
electric and mr.
Obama get the go -- up.
Look they manage once again to snatch defeat from the jaws of victory.
The three of us on the next commercial -- could figured this out.
The point the point is that -- -- you put I would report.
Well I mean -- they.
Just want political mileage and they're getting.
It'll be done it has to be -- And then they'll go on to the next one.
In my pay but it may not be done until the market falls by another five or 10%.
It seems as though policy makers.
Not to be beaten with a stake in order to get something substantial accomplished in terms of long term budget deficit reduction.
I can tell you your metaphor.
Probably is welcome -- -- every viewer in the country right now because the idea of beating these politicians with something right now.
Is compelling.
I mean this is this is really getting stupid it's like spirit of the market -- spoil the policy makers the it is we look at these numbers that are coming in on the -- were watching we humans we have talked for some time.
The Bernanke bubble is rising and -- now is getting rather vote.
In driving this market are we now seeing that that shipped or we're talking about four point seven billion shares today we've been above the average all week.
It looks like we're starting to see a real.
Turn to equities are we.
Could be the case it makes a lot of sense if you really believe.
That money market rates are gonna stay close to 0% until the middle of 2015 and then.
Ten year treasury it was not gonna clock climb above 2% anytime soon makes a great deal -- Contrary it is -- it.
It's gonna happen and he's got his pedal to metal and he's not and it's.
He being Ben Bernanke President Obama has to.
Figure our whether or not he's gonna change our wanna read just a few words and I thought that the president already left.
For Hawaii -- arrived.
He says avoiding the middle class tax hike is not a democratic responsibility or Republican responsibility.
With their boats -- the product of this as our president speaking.
With their votes the American people would determine the governing governing is a shared responsibility.
Are you ready between both parties this is the same guy who has been fighting your tooth and nail.
-- Boehner -- this whole thing I mean he doesn't -- it's like the same guy doesn't.
Not at all of course he has to -- a little bit further reducing entitlements long term -- there's going to be.
Any reason to believe that were making substantial credible progress -- studying the that deficit.
Well I'm gonna very quickly pose one question that is.
There is some Smart money suggesting that we're going to see this thing get push beyond.
January for -- It's all retroactive don't worry about it just dust yourself off after the market explodes.
And drops at 5101520.
What are you -- a percentage.
Do you think that.
-- is that.
Possible that we would C a market.
Hold -- rather than sell off given that they say they're going to exit it's some on certain point in the future.
Well sure I mean the market can do whatever it wants but if you go back to 2008.
And -- When they said no -- in the market collapsed.
The markets -- very very tough place to disagree with and so what's gonna happen is you're probably will have a short term.
But very quick decline and the market does it have to worry about the response of the treasury bond market as long as you have the Fed.
Keeping long term that -- slope itself for the bond vigilantes have been defeated by the superior firepower of offender they're going awesome.
Firepower as we've discussed -- -- often.
And and that was a modest 770.
Points on the -- although they are sell off.
But you made the best point the economy is fortunately getting better -- when they resolve this.
We've all this money around you could really give a surprise -- up in the stock.
-- -- magical words aren't -- surprise up.
Are we thank you very much John thank you Merry Christmas general urges the Merry Christmas --
