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Duke is back just in time to get some cash for her clunker at welcome home I think you.
I didn't we got us I had a I had -- very interesting week out in California.
On this if this isn't to -- and just different ways.
The country is handling a recession and interesting your cash and cash for clunkers -- -- program they got there in California.
I was in northern California Southern California and look like a lot of dealerships with had this big signs upgrade to go to two cars and so.
Yeah we Californians we like our cars we certainly do.
Yeah -- -- runner up there it's true plastic for them -- -- -- that's thanks in California there's a lot of reasons why.
Oil -- the first to weigh in with welcome back Jenna now here they don't come this missed you these are power -- you have -- For those they knew they checked in on him not to say when.
A while we know of I was nuts and that you could always be watching such -- -- myself as much as possible.
Can't group that is yet this week you know hadn't yet done Kelsey was here filling -- did a tremendous job and we actually -- And now we have another big week because volcanologist clunkers things in and the market rally for the recent keeps congress shall we try to -- that every day we don't know why but and there's a lot of kind of negative -- think a lot negative commentary or question marks being raised all over the place today by.
You know Nouriel Roubini and people bay and Meredith Whitney and -- just about everybody's kind of question and everybody wonders why the market -- -- and lo and behold it just keeps on going out and just out of well.
Can't have a tape how I think there's a cliche there somewhere.
-- February 5 between you challenge your -- With us on the conversation board.
And I would like to hear from you in here he had to say just like to hear from Robert crane finally -- to -- about this market.
Robert on -- -- Monday have it today.
And very -- Yeah it seems like the -- its resistance is up there but my.
There -- -- out -- way now lob I think we're talking financials though and in you have to keep looking again one of the strongest.
Groups in the market rally today you look at Citigroup touching five bucks today -- 97 cents back -- on the market low.
In early march -- clearly it's come a long way to questions too far too fast and old friend Dick -- they have -- -- securities elephant -- today -- say that actually over the weekend saying just say also is calling.
Putting a number on how many bank failures he sees the rest of the year -- 152.
As many as 200.
More institutions may fail this year that's what he's saying that we had about 25 last year 81 banks by the way have failed so far this year.
-- -- in -- following this Yeltsin thinks is gonna hurt.
The stronger banks to write we talked about -- the FDIC payments.
You could see eleven billion dollars in normal assessments this year and an additional.
-- dipped 25% of pretax profits so you know.
In what's a pretty good environment lending for banks in the fact that they have a big spread between.
-- at a price -- they're paying you for money say trigger you know deposit the cash in the bank.
What they're lending out that over time is historically huge right now -- -- by the with a 25%.
You know -- take a little earlier today and yeah that's a much bigger deal that and then the idea about a 150 to 200 banks would have.
The case may be right that -- -- fail but that's a huge number cutting into their profits because I think some people forget.
How the FTSE works who think this is our money but in fact -- the banks that are in the banks -- -- -- -- on this and and looking out after all and I mean some of the smaller banks will fail we'll see others -- in colonial -- snapped -- my -- TV of the week.
You'll see some of that but you've also got some of the the FDI -- to go and and and pretty much just take over themselves until they able to find someone.
Cummins has now it's a natural buyer out there so these FDIC funds are getting used to prop them up in the meantime.
Young at big question -- You mentioned about who's the who's the -- in the market we had that the second biggest stake in Spain -- and -- one of the banks that failed over the weekend and -- question for all of us isn't to be really care who buys -- failed banks because.
The conversation for the FDIC at least tomorrow is going to be about -- -- lack some rules.
-- you can jump -- because some say hate it is private equity funds and the market they have to cash in Milan fashion some of these banks.
-- say you want -- mixed.
Of course they have to get cash from other banks will -- it didn't sound that would filtered -- through.
To them as a middleman supposedly they're -- they're -- -- -- that didn't happen large piles of cash have been sitting on way to invest.
-- just have to wait and see that they -- in -- have to go out.
Take on other loans to committed and seal the deal so to speak depending on how large the banks are right.
-- that they do with the private equity thing okay thank you operator Robert Gray with this is afternoon let's go to -- is next co president portfolio management consultants.
Rich is with us to talk about the market.
From LA good to see rich thanks for coming up on the show today appreciate it.
-- Amir -- thank you you know it's it is this market that keeps on.
Keeping on that we keep talking about and everybody and as saying this morning it is -- the most doubted rally you've ever seen from the start everybody Saddam there's nothing to this it won't.
It's an -- it has to give up the ground at some point have to have some sort of -- correction every time we think we're gonna get one.
-- next that next day -- back up again and now you know we're up and another fifty plus points today on the -- what do you make of it.
You know Kelly right it's that it seems that depending on which side of the -- not -- two of the best of times of the worst of times that that.
A tale of two cities.
And and frankly if -- -- sitting here last week at this time we would have been that starting out when everybody predict it would have been a five to 10% pullback.
The market showed unbelievable resiliency.
And I think he -- gonna continue to see that unbelievable resiliency at least through the end of August September maybe a different story when everybody's back up volumes picked up.
And and people put more scrutiny.
On now on results on announcements on balance sheets on everything else but for now.
Don't get in the way as Jenna said earlier don't fight the tape I think she has yet.
Thanks I appreciate that that at every -- people who have been talking about volume since March since this quote unquote rally.
Began saying boy we can't be convinced that -- all the volume isn't there in the market mean that there's not a conviction behind these moves you say September is when people are gonna come back what makes you think that.
September you're gonna get the volume that you didn't get.
Let's -- back in May for example.
-- that that there's there's trillion still on the sidelines you know I think a lot of a lot of the buying has been institutionally or and it.
I think you're seeing a I still -- damage that individual retail investor.
Still sitting on the sidelines I think you'll see them come back in the marketplace but I think they're gonna come back with that caution.
I don't think they're gonna jump in with both feet the run up has been dramatic.
And and that things may have gotten ahead of themselves and so I think you want to be invested -- you want to be.
Consciously invested you don't want to be something typical happy so how would he do that.
Well I think there's I think there's that a couple ways to do it.
What we have portfolio management consultants do as we talked to our clients about.
About thinking about a strategic allocation.
Having a yet having a locked allocation to both stocks and bonds.
And then combining that with a tactical allocation is more opportunistic and nimble.
We call dynamic portfolio strategy.
And that really it really has the best of both worlds because you're in the market so you are participating what we get these dramatic rallies.
But you're opportunistic and you take advantage of some of the shorter term momentum -- that take place in the market.
Okay go on so little bit more on the basis that.
-- -- did this.
And the terms of how you know when to make those strategic moves you're talking about the guy had.
Well I think they're they're number things the a look at you look at that the technicals you look at the fundamentals you look at some -- risk metrics you look at monetary policy.
And and and you take the outputs of those.
And you see exactly how they play out into the overall market the overall economy and then yeah I'm not talking about a day trading scheme or anything like that I'm talking about you know.
Month warm momentum type moves that you that you take advantage -- depending on what we see coming down the -- on the economic calendar.
So for example -- -- is -- looking at specifically.
Well I think right now you know.
A lot of the sectors appear to be -- but right now but as we said earlier we all agree you don't want to get in the way of that.
Clearly if you think about that health -- particular.
And we go back to the early ninety's during the Clinton administration when health care was battered.
Because they hope it was going to be complete revamp through the app to a health care and early ninety's health -- looks to be a good long term play it's taken a little bit of a beating.
But that it you know it it appears as though it it especially in the high quality arena it looks to be along.
But hey it's live longer term great -- not -- you know health care insurance companies it's not about you via tags big farm what area specifically in health care.
I think accommodation tell you mentioned that you mentioned big farm -- at Johnson & Johnson is an excellent an excellent place to look high quality company.
And also some of the insurers are excellent as well.
A look at all right and there was some talk this morning that the daily times have it story -- aside those existing and saying that.
-- health reforms actually may not help hurt these big health insurance companies as much as we first off because things like the public option are now not as popular politically.
As they have -- -- started but anyway -- -- -- -- -- -- -- win some of the big issues of the data we kind of started off the show with and one of those -- We could talk bank failures -- property -- -- the other thing that a lot of people seem to be talking about today is the op Ed the Nouriel Roubini wrote in the Financial Times where he's talking about the risk.
So that'll happen but the -- that -- W shaped recovery.
He's going to be what we go through that risk is rising.
Did you see that and and do you agree.
I'm familiar with that -- we're familiar with is that right on the money call -- out back at the start of this whole crisis.
He's been that he's been a little off target here recently.
And I think he manipulative pessimistic now as we sit here today as well.
Clearly there's some strong -- in front of us unemployment continues to be an issue consumer spending continues to be an issue.
But that's Billy by by you know great comps and markets overshoot on the down side.
And it looks like it's completely over shot on the downside if we look back to the march lows and so I don't really see I don't really see the doom and gloom that he predicts.
Well you know it's you mentioned that.
-- the market might be overvalued now and I remember shooting in the downside we've come fifty some odd percent off those lows and you have big investors in the journal today about -- was the other thing I wanted to bring up.
Jeremy -- other states say that -- called the bottom.
Back in March is that hey this is time to get in now a lot of those same people.
Are saying well you know it does overdone now's the time to get out how do you judge when it is time to get in and out.
Take some money vs off the table vs get out completely mean what -- you have to be -- those types of conversations -- or at least thinking about those things now right.
It's a question about time frame actually got.
You know right now a lot of a lot of the a lot of the people that you read out there they're saying take a little bit of money up the table.
Are more short term in their orientation.
And if you've had a dramatic -- -- -- talk to clearly you want to be thinking about taking a little bit of profit off the table.
By the by the same token if your time frame is is longer.
Any spending pullback in the market is gonna be buffeted is gonna be supported by still the trillions of dollars of cats that are still on the sidelines.
And so any any pull back like the one we saw Friday a week ago and last Monday.
Is buffeted by a lot of money on the sidelines and short covering going on at the same time.
There's so many different comparisons in the Great Depression -- people lying to plug and then when this market to the template that -- Great Depression.
Has given us that the Great Depression he had this rally 60% off the lows.
And then the markets went down again you had this type of -- W recession that Nouriel Roubini has been speaking about -- -- spoke about today in the Financial Times.
-- that nervous but here I mean everything you're saying seems right but then you have this -- example of the past three seed since striking similarities and you have to wonder maybe that is the template that we're going to be following.
But there's an old school of thought out that the talks about a reflexive rebound and a -- rebound is what we're in right now typically that is followed.
By -- pull back but it's that it it it say it's a function of what's the size and the scope of that pullback.
And I think that -- Roubini all due respect him has probably overshot that on the down side.
Who we might see -- W right but it W with that bad handwriting not too dramatic downswing on that bottom side -- that I like that the.
You -- -- but one of the things he brings up an and then it it's made it it really is going to be the key issue here that we don't -- the answer to is how the Fed is gonna manage this on the other side.
The -- the -- -- he burns of the damned if you do damned if you don't have to deal with them how you're gonna handle.
Coming out of this but that the Federal Reserve at some point get a raise interest rates in the comparison that's made another article today is.
I believe in and the thinking it seems like inside this administration and for Ben Bernanke itself if you try to read between the lines what he said.
Is that they fear that repeating itself and they are less likely to raise interest rates any time soon for fear that you could because of that choke off the recovery.
In other words they're more likely to hold off on their rate increases do you think that's the right should we -- that that the right approach or shall we were worried about inflation sooner rather than later because that's the key issue.
And you know that's up to the Fed to handle that -- how do you think they should do it.
Well you know they've already given a signal that the quantitative easing program is gonna be behind us in the not too distant future.
But that doesn't necessarily indicator give I think it give credence to the fact that rates are going to be on the rise dramatically.
In the near future as well I think what the consumer still being where they are.
And housing still being where it is both in pretty bad states.
That it's unlikely you'll see dramatic interest rate rises.
It's unlikely that that anything's gonna transpire which does that adversely affect the consumer any more than that consumers already been affected.
-- wants to know how many of your clients have actually stepped off the sideline and now been more comfortable.
And investing in the equity markets.
Well a lot of our -- a lot of our clients we we advise people who are invested to begin with and so a lot of our clients were fully invested.
Throughout throughout the style at the start of this market decline.
And that's systematically throughout that entire period.
We've gotten to take some money out of that strategic allocation that longer term orientation.
And think more dynamic -- with their assets.
And so by and large our client base is invested in the marketplace they just had a different allocation allocation is more nimble more opportunistic.
At this particular stage of the game and that's proving to be good you know people people -- Feel like winning by not losing in the fear of losing big again.
Far outweighs the satisfaction.
Of participating a 100% the next the next bull rally.
And so they have one foot in but not both -- -- Still real quick here that you that you won it -- things you're talking about this morning -- that the US dollar has declined so much or there's no weakness in the US dollar.
That that -- constraint in the commodities you have -- that's had a relationship happening in the markets and that's why we're seeing.
Oil hit a ten month high along with the S&P what do you think about that.
What is somewhat contradictory to see see yet commodity prices -- particular.
Rising and and and and the market that still strong you would think that would just continue to exacerbate the consumer's.
And that and we shall say I mean that you know be itching to see what that back to school sales look like on the retail side of the equation now I think I can tell you from my have my own personal standpoint if my kids are any indication.
Back to school sales are fine points that we may not be we may not be we may not be as up downtrodden with those results as some people.
-- plan out the power and our kids from.
I have a twelve year old an eleven year old putts on eleven year old daughter we have Brendan Foley as -- fully -- I exactly.
-- -- -- -- bring them on next time for some stock picks and find out what they're actually liking disliking isn't that good indicators they can go to visit to be rich hues and I'm -- just from Los Angeles thanks -- -- and CN.
All right nice Janet thanks -- you're welcome good to have you -- gonna move on to this cash for clunkers story which is another big one today right and one of the things people talk about.
Is you know it was intended to help the environment.
Didn't work at the end of the day because the days -- today and -- the program.
Send your high -- Smith is -- with us that our analysis we know would sentence him in the show because we hear her walking into about six.
Walks away because it.
I had exchanged views on this that I -- but he's next on foxbusiness.com.
-- -- -- Onions and green which is good thanks Sam yeah at the joining us for outlets it was with this that cash for clunkers programs and yet so it bears a couple -- pictures out -- -- this when I'm holding my hand actually from the University of California Berkeley.
Where there's some conclusions being brought about this that sort of you know back -- the -- sort of calculation here.
Which is what the Obama administration that how did.
Up for the success for the program that it would save us all -- carbon emissions but they're saying that the cost of the cash for clunkers program.
Not a success either saying -- actually costing.
Between two and 500 dollars for every ton of carbon emissions.
Abated in this environment of the cash for clunkers program so.
And and I'm starting to sound a little.
Can using but most expensive or it's not as -- fuel efficient -- not it's not actually helping it's not as environmentally beneficial business sense to get these clunkers off the road from and turn in for more fuel efficient vehicles.
At the end of the day they're saying it it doesn't work basically they're taking -- miles per gallon the newer vehicle.
-- vs the one turned and which on average the Concord fifteen miles per gallon in new cars 25 miles per gallon and so at the end of the calculation if they shows that.
We're paying between two and 500 dollars up for every -- of carbon.
Avoided carbon emissions from avoided in this environments that.
Here's the thing in the critics are gonna argue hey guess what it got people out there spending money it got people out there buying vehicles -- -- retail sales.
Not so much we're also doing research and the other side -- that showing that all this is really doing is transferring the dollars that the consumer spending.
Into the pocket of the of the auto makers and auto dealers right now we're not necessarily spurring retail sales.
This is that in some cases those people that we're going to wait till the end of the year perhaps we till 2010.
To buy new car they're just buying it now.
So perhaps it's just the transfer of the dollar from the consumers so.
Does a good comment by the way just you can continue the second center but one of our viewers the road in with when I said.
But aside teacher strike by saying you know assisting working -- -- well we can't answer the Clinton question of whether it's working because the only verdict will be when all of the the new auto loans are either paid off for defaulted -- when things people worried about.
-- and then you know the other thing is -- room afterwards we have to just the sales of cars without this propped up demand and of course you know.
Aren't selling as well in fall off the cliff and we're right back to a restarted may be -- wasn't success either some analysts.
The great -- -- that feeds right back into the idea that at all these folks that we're -- -- -- later just popping now because they're being handed 4500 dollars to do sell.
Well perhaps we're gonna see sales fall cliff come October -- the new models are put out in the parking lot and prices of cars and trucks returned to more normal levels.
You but it's -- important point out what are we seeing July retail felt they fell for the first time in three months.
Ex autos if six tenths of a percent at -- decline we've seen retail sales.
In three months -- the steepest decline since March so clearly.
Any of the critics out there were saying -- but -- spurring sales Kate is doing good for our overall retail environment -- -- -- that's the case not that we've seen.
-- -- What about that we had the conversation this morning with Matt -- on our morning show it said you know.
Three billion dollars of the deal.
Pretty much the programs and success for what it would it would need to deal could help the auto sector got a little bit got people buying more fuel efficient cars and I feel business they're gonna be 23 years from now that.
Know today it's three billion right and then got money you're spending anyway I -- -- that right exactly so.
Why not guests call to watch now -- to our right Walt -- positive -- -- really I don't know but it's only -- only that amount and -- soundscan that is sort of the problem that some of these researchers again in the back of the envelope calculations how would that.
Is that the administration didn't -- -- as we want to help the auto makers wanna help the dealers.
Eight out of this and it would be a success for us environmentally.
In this country remain -- -- calculations are showing otherwise that it's actually costing.
The government several hundred dollars.
That's actually like destroy some of these clunkers is I mean is that the reason and that is you mentioned the difference between fuel efficiency that that he that you actually -- -- -- a lot of you folks out there were responsible for it recycling old parts of cars that are turn -- the clunkers that are turned it.
I think we're not really being given the chance to use those -- because -- emotion that's part of that.
Contractual obligations market and he's an island as well here that article New York Times.
This the -- that's dealing with the recession and one of the things that the husband is doing is going to you.
-- -- collecting parts from -- does not find him and putting money back right.
And that's how he's making some money for the family and Larry it's really a market out -- and there's a couple other angles that your your.
Pumping me to remember -- now is that that is one.
The other part that is a lot of charities that hurt by yes now if they were so dependent on those people that didn't want to have to go sell their card -- figured -- I -- get nothing for this anyway and it turned it.
But that I charities were used to getting those donations a lot of donations just weren't exactly getting in touch in the used car market hurting a little bit Islam right.
Centrists and stuff and think of their intent is very good at that helping with the memory of that's meals -- thank you high heels we'll talk to see -- -- click those -- and then move on out here.
She's you know it's it's a -- well and that tells you and I don't allotted for the jets.
Speaking of which we we're -- have -- -- the clockers you know the other way people like to bash is clunkers program we've heard a noise -- as we've heard on our show.
But they can't handle it how clunkers how they gonna handle health fragrant.
Our friend Rick Newman from US news world report -- -- -- how -- how much of nonsense and he is coming up in just a moment as well.
Foxbusiness.com lots of -- John is.
-- with us from Detroit -- from Amherst partners to give a little bit of a perspective from.
Well from the city itself the -- there may have -- -- seven.
Yes again thank you good to have you back and it's great to talk to some from Michigan.
We just heard from Sanderson perspective.
And whether or not this was an effective the program when it comes to environmental friendliness.
How do you deem this program.
Was it a success.
Five I think it was who was good intention.
And mediocre results.
Going to -- here last segment if if we look at what's anticipated.
As of about 700000.
To be processed through -- cash for clunkers program.
Only about 200000.
Of those would be incremental sales.
The other than to balance the 500000.
Would be people out there that would be buying cars either in between now and ended this year.
Or next year or some analysts are even -- in the in the following year.
So when you look at the three billion dollars that the government has put towards this promotion.
In it generating only about 200000.
I would say that the results are.
OK so mediocre result you would have expected more in other words out of -- than what we ended up getting now what happens -- the sales.
He -- we're taking some of the sales and inserts essentially cannibalizing the future sales to some extent what is going to happen now that the program at 8 PM tonight goes away.
To those sales.
Well you'll you'll see traffic in the dealerships go down immediately.
There was a flurry in the last week or so when.
It was announced that -- that tonight is the last is the last day but even here in Michigan and in other places across the country.
You saw dealerships shutting down sales for the program on Thursday night.
They want to ensure that they're going to be getting paid because if the if the applications are processed.
By 8 PM tonight.
Then the dealerships run the risk that they will not be paid for the sale.
Do think it's a real threat.
Yeah I I do.
You do the as I said earlier the excuse -- of the program.
Has been suspect from the beginning Bryant in the way their government has been processing the applications from the dealerships -- -- the classic example.
Well if if there is one piece of information -- that is missing from the application.
Then the government returns the -- to the dealership and a half.
They have to redo it so there's a lot of -- work going on.
And if you have of flurry of applications where people are really rushing to get the application done.
Let's say in between now and 8 o'clock this evening theory is the likelihood goes up for the propensity that in the states -- everybody you know a bit and then they have to -- Do anything -- having it easy to make a mistake like you make a mistake -- your tax return -- -- you -- -- -- back to your.
I just stated that the line for two hours to get -- new driver's license if you had a piece of the information they were sent to the back of the line it was unfortunate.
And part of that was that -- the nightmare of New -- can be badly and it got there a conversation.
Is still though that was at -- comes down personal responsibility so.
-- what we profit taxpayers who want to be you know.
Responsible with our money and if that applications that filled out correctly -- well I mean.
You have to -- good business.
It and I agree with you but if I've talked to a couple -- larger dealers here in town.
And the the directions.
Or the instructions that were given to the dealership initially.
From the government on what was needed and what have to be done was suspect and although they improve that -- the as the program went on there's still questions that dealers have about what information is required on and cancer patient right.
But also one thing help -- generated talked about it to some extent I'm not sure that I -- get that argument as much as because it takes a while for people to get paid and a lot of different industries as much as some of the other wants.
Whether it's cannibalizing the sales and then this it's a legitimate.
Certainly issues that can be brought up -- this clunkers program has run as smoothly -- lot of people maybe would have liked but that that when I'm not sure I understand but that said Scott Sheldon let's leave it on this.
At the end of the year and going into next year what is the auto sales environment your view you're there in Michigan and analyze this for a long time was -- -- -- gonna look like.
Well what what the -- cash for clunkers program has done Connell.
Is if you're looking at annualized forecasted sales before the end of the year or before the inception of the program rather.
Then they were running at about nine point eight million.
This -- this will push the the annual sales above.
Ten million British is it is a drastic reduction from -- sixteen or seventeen million that we -- on 07.
But the word we're gonna still see see very light sales in in 2010.
Probably around the eleven million mark one of the things that the program is done.
It is shown that there is a pent up demand for cars.
And that if you look at the top ten vehicles that were turned in.
Suvs that are aged eight to eleven years old.
In these vehicles have to be turned in.
In thus the pent up demand in there are still vehicles out there that have to be -- place.
But if there -- if if sales go above eleven or eleven point two million in 2010.
I think there's going to be a lot of -- Surprise people here in town.
Turn good enough that -- isn't some numbers to work for their specific numbers so thank John appreciate it.
What you see the you know that that we're gonna get this argument I think this health -- argument by the way that we're gonna talk about next this is great canard.
Let me give Arnold and -- find it get -- veteran health care like they've run DMV the government gonna run health care of my service Postal Service that the game plan.
Ed could get it better and health care like Catholic -- -- talk a little bit about that.
I'm Rick Newman -- looks.
Stay with us we'll be right back.
Abraham is from US news and world report he's joining us and -- the chief business correspondent there Rick always good have you hi guys appreciate it interesting and com that you wrote about.
Why the cash for clunkers program in fact -- prove that the government might.
Be able to handle health care.
Well it's become mentally it's become really fassel the same look the government can't do acts right -- in the thing the government does worse in your mind and you do you want running your health care.
I just ask the question a different way could your health care insurer.
Have run cash for clunkers now as as a disclaimer I am not a fan of government bailouts I -- and there's liken it to element of absurdity.
Two let's throw a few billion at this at that -- another thing.
This is the closest we can come today to a defense of this clunkers program everybody I'm bashing it's only so I don't are necessarily -- to defend the clunkers program -- I'm just saying let's look at it in different ways so this is a program.
That was set up by one arm of the government congress it was set up for now we know a grand total of about six weeks they won three billion dollars that it.
And they said OK with about two weeks warning.
Noticed two weeks notice we want this agency the national highway transportation safety administration called -- Take to run this program.
So and it's just somehow found 220 employees to put to put on this program they only have 635.
And when 225 wasn't enough they ramped up to about 12100 finding them from other agencies and stuff like that and so twice the total staffing -- this agency got thrown on to this program.
And look who's complaining it's not commit a -- car buyers are not -- car buyers got covered.
They got the rebate and of the onus is on car dealers to.
To make sure the paperwork is all filled out everything.
And suddenly we have what we're having -- love affair car dealers.
You know we all feel terrible for these car dealers who are not getting reimbursed within seven days I guess right I think what we might find out we we you know that the date is not only in on this but what we might find out when this is all over and done with his.
Usually -- yeah if you're who expects to get reimbursed overnight when you don't get the paperwork right nobody.
Right so let's say and to taking six weeks for these you know what amount to hundreds of thousands of dollars worth of rebates to some dealers -- -- -- take six weeks for those that come through also about the the amount time it takes my health insurance company to send that rebate check to me you know.
When I want it reimbursed for some something that my doctor wants us trying to -- -- killed while trying to save changes and is trying to follow this -- about it but the point is.
-- you know for all these complaints legitimate that you could raise about this program and other government programs that you have questions about this one seems ridiculous who gets -- seven days for anything.
When you when you go to buy a cell phone and it comes with a fifty dollar rebate.
How long do you expect to wait for that rebate check.
I think it's three to six months.
Now in the fine print it says rebate could take three to six months for processing they basically hold on your money as long as they can -- and they give it to you at the very last moment for -- about say this is outright fraud.
A six week rebate bit.
The consumers already taken care of I mean this is where this is actually a reasonable standard why I think the government screwed up is they probably did not have all those procedures now down at the beginning.
And they -- should've said.
Expect your rebate in 48 weeks are so dealers I mean this is this is important because if you're running a business in cash is going -- -- you need did manage your cash flow so that probably screwed up in that regard but.
You know show me -- show me a prop up private industry that actually doesn't you know with no notice.
Isn't it great when you get -- -- and least expecting it.
You've -- you know I like.
Never -- that's a hundred bucks it's fantastic I Griffith.
-- what eight it's it's great to have that perspective about the cash for clunkers program to bring some levity the conversation because it -- been is that the stimulus and things -- and moving so fast.
It's been hard to get a grasp of what's going on of the things that we have seen him and we are gonna wait to see.
Against -- retail numbers and how much this is cannibalize other industry's -- to talk about it in in the realm of cash for clunkers and and what what is it should be expected by dealers it -- it's interesting if fact is what we're seeing consumer class act.
Unintended consequences and I've seen other analysis and you're forever for some analysis I've seen -- -- assists as the same thing.
It doesn't look like the numbers will be big.
So it's a little bit of retail spending that might shift from some of the back to school merchandise -- example and things like that.
By all accounts it's going to be a lousy year for retailers I -- people just don't have much money -- And what we saw that -- the last number right the retail sales are thought clunkers really helping out and the bottom line number was not a little bit and it was actually down I got down right point that I think that's any anybody has expectations for a big bad bounce back in retail is going to be very disappointed.
Do you think -- -- just sitting here you're thinking about this program that.
You know he did and -- that fact that maybe you could sit at the profits for this that this should be a permanent program but something.
-- -- -- It's encouraging government should continued -- subsidized private so I mean I.
I am most feel would just like to the government get out of the whole business of having to subsidize as much the economy as it is I mean the government's already huge yesterday economy.
Cash for clunkers so if you just do some quick math.
TARP was 700 billion dollars -- -- is almost 800 billion dollars right Carolina and that's one point five trillion cash for clunkers was three billion dollars that's my -- one point 5% one point 5% hitting marginal almost.
Negligible amount ball -- bailout money.
And it got some people buying something I mean remember that there's a there's a homeowner program that supposed to.
Provide fifty to seventy -- billion dollars to help solve that problem.
I mean nothing nothing.
It's happening there.
And it that I had an eight inches in harms patients happening out in California because he studies cash for clunkers senate at all the different auto dealerships and -- -- -- freeways right.
Right but the conversation anecdotally between friends is that.
I they're making offers and -- they're getting outbid their night and they can't they can't get -- hung in there throwing money trying to get homes and they can't they're wondering part of the reason is.
Is banks not.
It giving them access to credit for certain bidders are slowly down a process to get closer to that November 30 deadline -- you know perhaps in the -- but a lot of speculation that reminds me.
To -- a bad idea don't give anybody -- you can extend past the clunkers to homes right -- your home clunker and turn it in for something cheaper to get this big government leave it right.
Or -- -- -- it yeah I think it's safe to go back to -- original.
Blog post threat on US news.com.
Which it did does raise you up -- -- from orbit to me it raises a larger point when you talk about.
That the government do they really want to run health care because I remember the first day this broke.
Didn't you try to remember this week that we -- a couple of guests on and that line was used was my multiple talk all they can't run this that can't run health care.
And I think it brings up a larger that you say it's catchy it's timely but it's also misleading that there's a lot of things that are being argued now and in the country and you could disagree with.
With the policies the administration or you can be on the other side agree that but there's so much -- -- there's so much extreme.
Viewpoints being thrown out there that it just it's crazy they're not they're playing -- simply not true fair that that it almost did it hurts your your larger argument doesn't it.
It won't let me out let me -- water and preview of a -- -- wanna write this week -- think.
Let's say we end up with a government health care program that is like the post office.
That might be -- that would be the best of all possible outcomes because if if if the service is really as bad as it is it is the post office.
People won't want to do it right but it will I think you'll say I I don't I just want to stay with it in the private system.
And therefore the government you know the government option doesn't blow everybody else out of the water because it out competes and offers lowest price because people say I'd actually prefer better service.
But what is the post office it's kind of it's kind of -- last choice for people who don't want to pay for FedEx or UPS.
And it kind of handles everybody and -- the court thing it does it actually does get a letter from the center to the person who receives it.
I mean it accomplishes a basic thing.
And -- but nobody else wants to get in that business you have no money in that business.
To me is actually -- pretty good model for government health care.
And it just takes in this post office workers -- hours cat and now standing ovation by the way that's another issue those -- there was another piece of the journal -- That kind of a -- congressman lines usually very similar saying that he compared to maybe public housing for example -- at who inserts a roof over their head grade Health Care Reform.
But not everyone would opt to live or one saint -- it's not -- it's not the best option you have the choice to pay more for a -- or a better plan.
Which I think probably a good indication that all for the private plan to probably be provide better service -- -- something pretty -- blog.
The fight like we've anything's worth -- blood.
Yeah they understood like online and me -- it it's still the level of excellence here I think so ovaries that standard but that every day.
All right our Achilles make us think even if we don't want to let that much for coming -- CC Internet and Rick Newman from US news and done we'll report.
So we're trying to bring everything together we -- -- health care.
-- clunkers health care reform now -- Swine Flu and that little bit and read Israel as as average estimated don't.
-- he is afraid that ridge said he thought email -- right.
I see the entire Fox Business Network devices -- everybody the secret that you that sent the Fox Business Network classic and -- about H1N1.
Yeah I -- the administration took a look at it and said that it's could be a serious threat to the United States H1N1 of his worst.
-- the 1976.
Flu strain so the administration continues to work and get ready.
For flu season.
With possibly a pretty bad H1N1 season them.
-- that comparison though.
I'm not familiar with the 1976.
Flu season wise that's not yet.
I guess it wasn't that bad that's the point of trying to make them so that's -- -- reason to not be familiar with it.
My -- back.
Well that's -- thing I mean this well.
We can get in depth I guess H1N1 another day but the the the idea.
And hits you could be just the flu now some would be able to work our way through bodily health health care going.
We have Richard comes on every -- and it's always something you know what what's that what's today's angle.
Well it's about really attacked with Democrats are going to use when they get back -- a couple of weeks -- you know you look at the public plan whether there will be a public plan whether democratic leadership will decide to bend on that public plan a little bit maybe.
Lessen its strength perhaps compromise with co -- versions.
Whether they want to try to move ahead in and bring only Democrats on board with this whether they want to try to you.
Perhaps bring some of the more moderate members along bring along some Republicans and it is a lot of different.
Avenues that Denver Democrats can choose right now and if you listen to some of the comments they're making over the weekend it seems like it's all on the table including this idea.
Of budget reconciliation.
Republicans certainly don't like it Democrats.
Few of them really don't like it in the senate it would require the threshold.
To be brought down to 51 votes to pass some of the more controversial items.
In health care as opposed to sixty but even if they do use that there's no slam dunk that they'd be able to get that through.
Paid rich you know it is interesting times about and that's imagine bringing on these things together Swine Flu -- and Health Care Reform we understand the vaccinations will probably take place in October is that when they expect most their vaccinations start.
It's one and one that right.
I guess -- I think so yeah I mean I don't -- The only reason -- as it is interesting timing because that's when we expect a lot of the the Health Care Reform debate to really -- mean obviously is gonna return in September but.
The timing you know the fear of the flu -- bit more vaccinations and accessibility to vaccinations and being able to get them then.
In the conversation about health care -- -- is.
You know a conversation that can easily -- -- -- do you think there's really much about.
Well I am very well could be all depends on what age when am wondering as I remember when the when the first.
When H1N1 first appeared from Mexico I mean remember.
The press that -- gotten the attention it that it was given in almost the pseudo panic that we don't work herself up into monitoring this right it is certainly spread around the globe and it is certainly.
At least forecast to be a bit of a mainstay here when it comes into the into the flu season we don't really know.
How that's going to play -- of course the accessibility of how you get a vaccine out.
You know we could do bring broader idea of South Carolina ended October for health care.
And even even separately if you talk about two separate tracks here I mean that they're really down.
To be big stories in October with health care Democrats have to use that budget reconciliation by October 15 if they choose to -- though.
In -- -- Democrats and Republicans negotiating on the senate side.
They probably yeah I won't have anything by the time they get back in September that'll probably be pushed.
Into the negotiating stages over until October so I think even if you if you talk about them on two separate tracks they could very well be -- very important month for both of.
Yeah and just seeing red tape to speculate -- appreciate you bringing this things together.
I thank you -- much response and then decent access.
All right rich you know we talked a lot about the summit in the start of summer series you talked a lot about small businesses summer so there is a lot of ingenuity entrepreneurship and all these types of things happening in the country -- even with all the headwinds and next up.
Why this is becoming the summer.
Of the food truck.
You know about that I love these guys this is foxbusiness.com arrival of the strangest moment.
Headlines are -- is the board your favorite -- track and why we want to hear about it.
Is it ice -- and hot dogs there's a falafel tracked down the man has a line that you would not believe I think apple is money -- have gone in yet.
And it is Colleen -- is that it's not business editor for the Wall Street Journal she's joining us now she wrote a little bit about this phenomena not calling.
It's going to be here right yet if that during the summer of the new track and you just this past weekend without and saw.
Cupcakes being sold from the food Elton -- really hungry all the time I think they go anywhere yeah.
Hooters snacks -- right exactly what do you what is the trend that you're seeing on the -- these.
Are these professionals yet they -- professionals and we've -- the trend really for two reasons one is that restaurants are suffering right now sober a lot of restaurant owners this is really quite simply just another way to generate sales of some people have a restaurant.
And I'll have a truck on the side as a way to.
To maybe get more customers and to bring in -- madness and the margins actually quite high on these tracks with a 21 restaurant owner who.
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- of ice -- out there in Austin, Texas -- Now we have to let us and think somewhere in Austin, Texas and it's.
You know it wasn't always this way though in terms of it is we simply get a hot dog or whatever it is as simple stuff that probably was not the healthiest thing in the world that taste again and then all of a sudden -- -- -- -- that wanted a change but.
I think I think it's just because we're seeing more advanced and and people's -- have maybe become a little bit more sophisticated.
And yet -- -- more hot -- then and pretzels but we're seeing a lot of ethnic cuisines and and -- -- -- -- -- options.
I think my favorite is French restaurant -- that we spoke to.
Who has a food -- on the side and so he's selling frog legs and ratatouille and asked her.
OK I've got this great ideas why didn't she is frog legs that mean no one of the French think -- Americans very sympathetic.
Kelly do you have a thing I have immediate -- for a month from your article forgive me for not knowing.
That there was that report about -- -- attractive in a different place in the city of Los Angeles they think it -- it was a Korean we've tracked in Kenya and it was you -- they would use Twitter.
-- tell people yeah are both -- little to gain.
Get out and play yes social media has really fueled this -- and and you out there appear track -- and you're in a different location every day you can use Twitter.
You can tweet about your location or you can update your FaceBook status.
You can also let people know about the different daily specials he'll be having our you're giving away anything for free.
So it's been a great way for.
Truck -- to let people know where they are what they're selling and to build a customer base as well.
That was one of your tennis three best ways to start a food truck business right he's the social networking but the other thing -- -- -- -- to buy one of these trucks.
On the cheap gas because seen how -- -- food truck yet they're not you know it is certainly cheaper than starting -- A physical location but after the track -- not see it they have to be up to code Health Department regulations so they can be as much as 40000 dollar -- -- -- -- is not -- right but just like with any vehicle you can always.
Go for the use option one restaurant owner we spoke to who sells desserts -- from her track here in New York she went on eBay chief 120000 dollars yeah -- a great deal.
Some of these things stolen in the I guess they are they don't look -- events had help from.
That person experience on the fifty ninth street bridge at 3 AM used to be just me in the food truck guys -- They are 3 AM on this bill coming to work going to I tried to work on different guys editor for the coffee cart.
I isn't rendering -- -- yeah.
Yeah I -- your options might be a little bit more limited at 3 AM I guess that the missiles -- the coffee -- guys is there anything that seems to.
Think particularly can't seem mean necessarily different types of -- this -- -- thinking -- this -- good idea.
I made got cupcakes for example -- how do you think he's gonna catch on -- wait wait and -- -- -- -- heat for these things really working.
Let's and that's kind of the tough -- you got to figure out what customers want that's and great thing social media you can kind of test out a little bit.
But if you RD have a restaurant makes sense to do something that's related to whatever.
Whatever it is he normally serve on his confession will be trend Munis is your favorite they had out there.
I actually did get a Coney Island last year and had some wonderful smoked meat and -- was and this -- -- tracks and they did.
I think it was kind of southern flair but it was barbecued chicken and smoked -- -- and it's fantastic.
-- -- is one thing did people.
How to people know who to trust and who not to I guess today have to trust the brand of who's making it first because all of us -- new -- used to saying.
Bad you know this is not the best thing for me about a mostly -- street need that kind of stuff that we don't know.
We don't honestly think it's a bit get -- -- -- that well later.
Yeah but keep in mind is that this is still regulated you know like if at these tracks have to be up at -- food regulations.
You also do need a permit to be an excuse to have a food track and that actually could be.
A strike against this if you -- -- go into this business that can be very tough to get a permit here in New York there's a cap there's only 3000 permits that are given his attack he can't stay exactly Acela some people go to the black market to get their permits that's not illegal -- we don't recommend that I -- other city that is a little bit easier and peaking at apartment.
You know backing to year question -- that's.
Is it gives them a higher and that's -- eyes of god into it yeah I mean that's.
That they find it worth their while packing it now that you're an idea.
-- -- what you wanna start.
I really didn't downplay -- it seems that and then there's been I can't remember the name of the coffee.
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- And it defendants parts -- at a Starbucks not having had this and I have a line and I didn't have I don't think they have a brick and mortar.
Shop I mean I don't even know that you could only see the tracks yeah I agree and -- -- sand but it that they had Ichiro has some ethical fouling people really loved them.
They -- the key there is catchy name.
Anyone that you would say listen this is you know basing your tips this this may not be the right move may be going to the store or.
Yeah play out well I'll be I don't.
The thing with having a -- -- is that it gives -- a lot of flexibility in a lot of freedom because you can you can go where -- line and you you know you need to take the day off you can take -- -- I think the -- that -- -- -- mean -- so you have a lot of that flexibility and freedom at the same time if you want to.
Win loyal customers and -- coming -- that customer base that and -- it can be a little bit tougher because you have to really you know you have to do.
You have to.
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- And then also to.
-- announcements are really go to residential -- -- that it can be quite disruptive to have -- to set up your perspective and residential neighborhood.
Now he imaginary your neighborhood your it.
Gambling he admitted they're selling frog legs yeah but again -- -- -- track I think it's -- -- good.
I -- -- -- bottom real lucky at the -- contract to stop -- that I -- actually glad I've I've been preoccupied following our viewers that this worked up about this is anything else.
Arguments now about whether or not you should look for healthy foods -- the F.
So I guess I brought up -- I want to ask if there's healthy you know there's still healthy food drugs out there again you can answer that question but Iranian DC said.
If you look if you look very healthy foods at a food truck he should change your eating habits and.
And then my little critical there are healthy -- I think yeah I think anyone who has.
And who is an entrepreneurial -- will realize that a lot of people want that helping option may be organic foods so.
I think they're Smart exactly so I acting fours and have a much not that's exactly what you -- -- -- you wanna go out and try to reach those people anything is the third as seen from this small business section -- -- to have tellingly it -- speaking Sharon had no we're doing.
The story that will run and miles paper regarding the four year anniversary of Hurricane Katrina and and actually -- New Orleans has become quite an attachment -- hotbed.
In the four years since the devastation from that hurricane.
There -- a lot of this says they're doing quite well there there's lot of support for businesses.
People really want companies to succeed there so.
It'll be interesting.
Even here first everybody and I got off very compelling I'd appreciate having a fun to have you well that's a good starting if you wanna start -- Pataki got all the infamy of review did not meet some of the -- Yeah probably ice cream and coffee will be -- Havoc everywhere can hear from someone who actually did real life is true that the -- -- -- The actual food -- even better actually.
By far the most popular item and we trapped ice cream.
Yeah it is no coincidence that I had then is joining us now bend and -- and -- van -- an ice cream trucks.
Britain India that they actually hear from them is doing hasn't the tells the story had a few assert this business well.
It really started about eight years ago when I was eighteen years old looking for a summer job and it's on ad in the paper to drive good -- tracks.
And suddenly I went with it and it worked -- made a lot of money.
And that made me realize the value of that mobile vending business model.
But the thing is everybody I mean the most we asked our viewers as John was talking about before all of which like CNN food truck and a lot of people did say ice cream.
And one of the reasons is because they're so used to have -- guys -- drunken people know.
That the use -- as you say mobile bending for ice -- so you said there was a lot of money to be made but everybody was doing it already right what you what what was your angle.
Hang -- well.
Our angle with these new trucks was let's make the best ice cream can possibly make and sell enough -- -- and they actually gourmet -- contracts.
Originate in the truck -- -- -- make -- an -- we naked and a little town called them down the York which is about five hours from here Maginnis in Louis county.
So honey -- we have three trucks were launching two more trucks next week.
It will also serve.
Very wonderful copy we will this country there denied copying it -- like.
OK so that we just heard about the cost for these tracks down how much -- -- costs actually get one of those tracks and -- keep your ice and couldn hit us up outta me depends on.
What -- you use that our trucks constant.
60000 -- -- with the content which is very very little compared to what it would cost for -- store share right.
Or do you plan to do that by the way someday you'll you'll feel it kind of go inside it's something it's because it was like to right now it's hard to justify.
Because you doing this -- confidence starting up a store we could.
Build about Ford trucks and -- an outbreak.
A game -- how many ice -- to actually sell.
How many flavors -- -- will the -- that I would like to hear that as -- but how many do you do a day like how many I'll call you now.
And it depends on -- slow Monday we might own thinking.
200 ice creams and good day and really good game might do you see on screen.
What was -- back to the angle on you know you dissident as you know mr.
-- there and good humor and all these guys and you know granted that it's not gourmet by any stretch but most kids want ice -- real quick and the deceit as -- happy with that -- -- What's your.
You guys are getting a different type of demo or our people that are willing to pay up because of pricing you probably will enjoy more than -- than we do on the and we certainly -- more than mr.
-- I mean kids love our ice cream -- even little kids who don't.
Understand why it's different case -- This is amazing and I think all humans.
Do appreciate pure foods that are made with -- ingredients and it's very intuitive.
-- -- case something and say wow that's.
On that how we sort of laughs do that yet -- the -- yes but yes I mean our trucks are beautiful submitted this buttery yellow.
And they -- huge menus with mechanical -- all of and then the flavors so that botanical juncture of the origin of the -- which is I think interest summit into don't understand that Vanilla instrument or game and -- I didn't know that.
And I -- here I want it dead well now we know -- no -- wants to know what the most popular flavor is on the truck well this is a very boring answer it's been -- I don't understand you know lovers.
-- -- hours later tonight it.
At both big at least that's for sample their population I'm not that this whole segment we should happen for how to people aren't you come.
You have to look.
Move you can look at our website and that's their locations but then just be sure we do and -- tweeters well -- it's kind of funny that because I'm really don't move the truck so every day it was the exact same thing on Twitter that he.
-- people still call and see where are you hitting incident and -- we're hearing here and he had one of -- -- you excellent.
Yet he says the best thing on that sometimes and not as much as they used to last year -- -- myself my brother Peter and my wife lawyer who.
Helped me launch the -- Cool for failing business yet -- to get had to get loans to start this.
-- we found investors.
Really mostly friends and -- probably making a profit -- so you put your profitable not just.
Yes sales wise you're you're actually turning a profit and -- -- -- We are retiring where we're at the tail end of.
So that admire your room maybe we can do so that I think it's a fine job let me tell you -- -- and I don't know I I think it sounds great.
Funnel oil trash like Sonoma and -- Harry I -- I distant and.
Thank you -- good luck with everything is another caveat about how they unless he's good at Twitter and our handle on Twitter is VLA Agassi.
The LA -- -- video and I see okay.
All right good -- then then then then and and it's been nice contracts Michael congratulations today if -- -- -- -- -- -- -- -- -- taken money right and hiring people scream for ice cream.
And it looks as treatment -- house in the -- justified because you know in capsule that's right I'd love ice -- by the way that's it for today show.
It will be on Hulu and iTunes and everywhere else that you can -- is back here tomorrow at noon eastern time and a great production.
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