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These kids are looking very into his new iPhone which we should mention today it's his cabin -- -- -- -- Is -- a little bit of this yet yesterday to Roberts -- -- sure -- check it out haven't done a works.
-- today's date yet -- -- that you can go to it iTunes actually upgrade your software remember that that was the announcement.
Just a few days ago that there is -- -- This will be a great for the -- persistent in your -- if you're not gonna go out of my new line and that way you can now and then have access to all these new applications.
That -- because -- a second yes isn't it essentially -- -- -- -- reluctant to -- and actually -- winds are idiots on the but it -- try to get.
Still if -- at first but you have I think -- the good -- if that -- -- system.
When she did that if he is going to the foxbusiness.com.
Website very I -- You can hurt that hurt accept -- her intellect and stream live with us on.
And not -- that -- you can choose you can read along -- -- people -- at home and and you can read some of the latest greatest stories or you can click on -- the -- button and watch this government really on our faces are so -- -- it can't iPad you know -- and we have to pay attention gets its life.
The that I -- people watching on Hulu and I -- lender or -- The what podcast there we are different -- scary here key at by the way I forget take a tight shot area.
It's really my trivia watch yourself -- on TV at the same time.
There at city if it does actually work which is in the USA today -- -- this big article about whether or not -- to the network would be able to -- support.
The new upgrades the system.
And the only good after system so if you're walking around you hit a dead spot you know there could be a hiccup in its great cries it has trickled.
I think it looks pretty good again getting everything out here -- is if you've got the existing when you need to logon to iTunes that you mentioned out of the top.
Upgrade and -- should prompt you to do so and then the new ones will be released on Friday we'll come.
With the new operating system which will support it fully and we have here -- out by the way coming.
Coming attraction -- couple weeks away so it is sick rides off of that but right now you can take this with you anywhere and -- father watching this you know in the Atlanta airport somewhere right now.
-- despite his watching ourselves on our iPhone at the time of the day for the markets it is the balloon was a wise reading our wide sweeping as to say.
A financial regulatory reform that we've seen since the great depression and president Obama's gonna be talking -- about we -- on that.
A little bit of debate about health care ongoing people talking about that a little bit.
Got some earnings out of FedEx today not to this has access right now not very good the forecast pretty dire -- that -- -- people -- FedEx because you know they handled shipping for.
You know people like you and me also for company so they really having a good gauge on the the economy in the you know what people say that.
If former Fed Chairman Alan Greenspan is to chat up Fred Smith the CEO of FedEx -- get his take on the economy no doubt Ben Bernanke does as well.
I really heard any anecdotes about -- but nonetheless -- -- watch FedEx for direction of the transports and it theory where the economy's going right now I says.
They can't really see visibility of it getting better in the first couple of quarters of their forecast.
Very downbeat FedEx and the transports and -- -- week anyway leading up to this report and so no surprise that.
-- -- me that it really disappointed.
Often the banks were watching the -- -- -- they they not only because of the the talk that regulation but remember today as significant day because this is the first -- that banks can actually.
Officially hand back over the TARP money -- -- that went down -- your favorites and it was going to be on the show in just about a half hour -- answer my questions about that.
And it's always great to have -- her perspective but you know what I was singing -- when he is the investment strategist at -- recently we would you first your first duty.
Look at this and Calvin is is actually be cloudy and his take our -- and human quality.
So is it isn't there yet this is your first time this is your -- Act -- and iphones.
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- I think that that equity markets have gotten -- little bit overextended.
I think that's largely due to.
Sort of a momentum effect because we've come off of the the lows the MSCI world index is probably -- Someone and or 3940%.
And so if you missed that you know when you're an equity investor you can kind of say well -- I missed it to a need to jump in now.
Yeah I think that's what you're seeing right now but defended their through these countervailing forces that -- -- -- pull a market back a little but I think and they they are.
First of all him despite all the talk about China.
-- in the US consumer is really what's what's driving the global economy and what what has driven to the global economy and we we know that there are in the process of so deleveraging at this point so that's a long and drawn out process.
-- senior credit.
You dry -- not only not taking out more but you people are using less up their pay down their personal debt whenever possible even in the face of the higher unemployment so that's not really -- gonna support higher consumer spending and even last week.
As we saw the market you know hitting the Dow anyway hitting in that finally he -- -- the consumer stocks were not participating in exactly.
Back -- I think what one really telling statistics.
It is if you look at the flow of funds report that was recently published by the Fed.
This this the first quarter of 2009 was.
When the first the first if not only quarters where.
The overall debt.
-- that was negative okay.
So and that that's -- that includes all of the all the borrowing by the by the government so.
It gives you -- sense of student of the magnitude of this the deleveraging that's and that's going on and I think.
You know that that had been priced in the market that think that you know the -- run a little bit now I think that that that.
Realization that we're really.
Not in this sort of rapid -- type of of the recovery right will will -- sort of at least -- the markets -- not pull them down.
-- -- And a lot I think they see it sends a headline that I'm -- -- -- I think that -- -- okay him or you know Morgan Stanley's -- NB BNT and US Bancorp was actually the first one out of the -- this morning so.
I definitely must know about JPM and in speaking of -- you know pretty a great -- from Morgan Stanley.
Talk about -- -- credit provision coming so much less from the actual banks of the shadow banking system really.
You know Wall Street in particular right providing so much of it was seen that contracting so much and and -- sort of thesis is that.
-- actually have followed credit creation more so than money policy -- they see the Fed pumping a lot of money into the system.
They're saying that it's not a -- gonna mean risky assets and stocks are gonna go higher following the money because they've been following.
Credit they're right that's what they're there thesis is is is that -- sort of along the lines of what you're saying yeah I think.
I think -- you know it is it that if you think about it you know credit creation is really the lifeblood of -- of an economy and you -- that the faster the credit grows in the more the credit is available the faster you gonna have economic growth and as the debate as to whether or not that's good or bad you know we've come off of you know eight years have.
And accelerated growth related to over leverage right but.
But you can see what happens when there's a sharp and and severe decline in leverage and and I think that's why -- saw that last fall exactly -- didn't -- and it was very painful and so I think that's.
You know that's why you you you have -- -- come out that says that risk assets really do track at this point in the cycle you know.
Or that I guess I don't think it I risked calling -- a cycle but at this point and -- -- -- whatever that we're working through right now.
It makes a lot of sense that you know people -- gonna wait for signs of you know expansion of credit he finds that banks are actually lending.
You know do that in the bank lending growth is is is positive and and since the sustained before they.
Truly dip back into risk assets.
So when we get it headlines and we are getting them back -- you -- mark and remember JPMorgan -- -- -- billion dollars in terminals already are now paying back the government I don't know if that's them.
The traveler's check or something like that it and they're going to be paying back the government so right how you -- had this big crisis isn't saying that.
It's -- take several years really to recover yet.
From what is going on them out right now.
That it it did you -- had sediment has changed a little bit here we're giving back the TARP money we're gonna get new regulation yet -- it seems like.
-- everyone might be feeling a little bit better about things that why should we be cautious.
I think we should be cautious because you know.
It's it's all relative game at this point can we we came.
From a point where we thought that that banks we're gonna basically go under overnight -- Lehman.
-- and -- banks didn't even trust to lend overnight rate other OK that is it that is a severe.
I guess breakdown in in our financial system okay.
Because of that they were there there there -- concerns about equities solvency of banks and here you got the -- try to shore up make sure that.
That banks didn't run out of capital effectively -- We've come a long way from there financial conditions are a lot.
But more improved since that point OK but we're still not out of the woods -- it would be much point worried about.
I think would be we should be worried about.
You know -- you're entering into this cycle where we we still haven't seen the effects on commercial real estate.
OK and we haven't seen the effects on the on on consumer.
It consumer debt OK so.
So banks with credit card debt and whatnot you know I think we -- the -- -- of the day for Bank of America particular jumping up exactly and so I think what you're gonna see is.
Because of the level high unemployment that we have that you.
Did that doesn't seem to be going down in terms of the continuing claims today.
You're gonna see sort of the knock on effects you know write offs that banks from the four consumer credit and commercial real estate.
And that that will be the true test of whether or not these stress tests have have been truly reflected the strength of the of these banks.
Yeah in you know.
You're talking about you know.
Sort of a looking ahead to the -- you I was wondering you know they really struck me last week when people start -- -- In the Fed started to raise interest rates and -- just after a couple of positive data points.
BC were were barely out of the woods yet and it's hard to believe that I mean credit markets are forward looking but it really seemed to be.
You seem to think they were getting it really ahead of themselves those people are you talking their books would say obviously try to do right but what are your thoughts on you know the Fed's next move in and when -- -- Now what I mean you know my my thinking is that the Fed is still going to be awhile before the Fed even considers entry in -- increasing interest rates okay.
But I think what the Fed is doing now is the key did -- controlling inflation is controlling inflation expectations OK so.
You have fed governors now coming out saying that you know what is making I guess statements as that.
We we can control the the the monetary policy that we sort of enacted we we can get out of it all this liquidity that we provided.
And you have potentially thinking about increasing rates.
What they're trying to do is they're trying to control expectations and show that the Fed is committed to price stability okay.
Even given everything that's that's gone on that the Fed is committed to price stability.
That the reason why they do that is if they if they lose that that sort of confidence of that credence that that the Fed is is committed to price stability.
Then you you've opened pandora's.
-- and obviously -- to maybe job and rates back down a little bit too you know a little bit yes less anticipation of rising and because we've seen the thirty year mortgage rates he would jumping back up to five and a half percent in fact -- -- we can -- mortgage applications were down this morning and the report was out from the NBA so.
Writes clearly that's got to be concerned -- were waiting.
Housing but that's not a matter that is what is some of the concerns of the viewers that are weighing in on conversation wanna know all about consumer credit and just how much is out there just how much we should be worried about.
The safely get to a couple questions Muslims from -- he was asking the beginning he said.
You don't jump into the market now.
Or in the near future.
And then we also have.
Melinda weighing in from Colorado and she says besides getting out of debt what else can Americans do to protect themselves receiving -- crazy.
So our -- of first -- at how how much are we dealing with out there and if we are investors.
Is it time to jumping -- we wait along and we still on that wait and -- time.
Well I think -- It's it's a tricky time for investors but let's let's sort of -- the the overall amount of debt that we have you know I don't I don't track the overall credit that's that's that's out there but I mean I do look -- certain savings rates and you know.
Savings rates have been at historical lows and then now starting to pop up a little bit okay.
There there have been some studies that show that -- in in order for the consumer to sort of reverse.
Did the consumption -- effectively pay for.
You know the right consumption binge that we've been on it it would sort of require them to save and then therefore.
Would would reduce economic growth by may be three quarters of a of a percentage my business and work that was done by the San Francisco that -- We could hear that by the way means is similar level when you talk about that that's essentially you would deleveraging that's -- -- leveraging private practice of an individual right right but you're just talking about -- getting ready yet pay off your dad and you happen.
Get even again and you're saying that's a long process not only for the individuals but as a microcosm of what these big banks -- Well exactly mean the the banks are effectively Lou -- you know linked to the individual because of mortgages and consumer loans okay.
So if an individual and ideally the individuals responsible and able to sort of pay down the flown by by saving and not consuming.
But if they're not even if you have a job right but if you're not what happens right default on loan and eventually the bank pays -- because -- gets -- to their capital so.
Try to Ellen -- and you can't because banks trying to leverage in their being right conservative with exactly right exactly so.
It gets paid for somewhere okay and -- that the question is you know how much of it is the consumers and how much of his is his banks and now.
What should investors do at this point I think it is it is a tricky time.
-- as an ass -- alligators I think -- to view is.
If you should have exposure to all different types of risks assets and -- appropriate to what your risk tolerances OK so.
I wouldn't go with the extreme of going a 100% cash -- right and whatever but but sort of a good balance now.
He can't be -- that labeling say could be have a little bit of everything and then well -- commit to one thing or another level.
-- committed this.
Let me come into this is that I think that there there there's there's a high potential for a problem -- with inflation not next year not two years from now but -- -- so.
You know that investors should really think about tips and things that that are correlated with inflation -- -- with inflation.
And some of our viewers badly just from Baltimore says that.
He might he be a shout out but you can hear from them that's -- I admitted that went firm so injustice what you know what I.
Particularly Bob before -- you talk a little bit about the proposed regulatory overhaul.
From what you've seen in -- -- -- any thoughts you can share about this.
-- I you know I I have it I'm not an expert and and I've been read the the fine details you know be it in general.
The regulatory overhaul given what we've been through is good.
But I think if it needs to focus more on sort of that the principles of not not trying to micromanage.
And more really trying to set up.
Either of the the incentives for excessive -- not to be taken -- So that's considered I think that that was -- -- but.
Right regulated -- right -- and not being overly heavy handed in terms of micromanaging and and doing things that -- that earlier you know you read about.
Potential for salary caps and things like that.
You know interfering with in the with the economics of of a of -- I think is never a good idea but I tended to skew more free markets.
There's 88 pages that you can look over -- hits -- -- -- like a got a lot of really good work.
And untold story of rape and that regular maintenance on the Oreo and art and -- New York I have you back again -- stepping -- -- they have you know.
I'd be out there in Baltimore you know when we thank you actually sides I -- educated Peter Barton just moments to talk health care.
-- They -- hair.
And it and it goes on and you for a long -- no doubt Peter burns standing by for us in Washington for the latest chapter to this saga.
The next trillion dollar program right -- -- -- -- can congress left.
Anyway they're there in the middle of it right how they yeah how house education.
Health education and labor labor and pensions that help committee.
Slogging through right now they proposal from Senator Ted Kennedy on Health Care Reform in this is the one of course that's gotten all this attention because the Congressional Budget Office.
Says that at least part of it will cost a trillion dollars over ten years but end up only.
Reducing the number of uninsured by less than a third adding about sixteen million people.
To our health insurance coverage and so.
That has been the focus of the discussion at the committee.
Committee debate this morning that committee hearing is going under is under way.
At this hour and that you know the cost issue is it's really front and center here and and how to pay for this and so that's we're watching.
You know and those games it's who who -- be milling millionaire which -- I can't.
Peter would be my one call he would be -- arm yes all that anything out there I think Peter Barnes and he made one call this is a side note here I hope you're right -- are counting on deck.
I have I'm not I'm a classic reporter here Jenna I have great breath but no debt.
I think allegation that -- that tends to work out pretty well right hey Peter good -- pursue -- I'm good at that yeah.
A when a rock -- you know -- -- -- getting by we're gonna bring him in just a second Peter but.
Is there anything new on the malpractice side in the malpractice to -- -- whether to set limits on this.
Anything with them.
When I'm not that we should pay attention to.
Well you know just the the interest groups in the stakeholders on either side of that -- debate are you know just howling about it the trial.
Who are the ones that bring those actions.
The impact of these malpractice lawsuits and these settlements.
Is exaggerated they really don't add to the cost of health care but.
You know experts on the other side of it saying that they do and in the business community.
Are yelling about it -- you know this this is.
One of those that I like to call the battle of the studies you know you have studies that he decided this.
I don't have all that kinds of experts that get back and justify any position that you take at the end of the day that's going to be a political decision so ignore all these all these studies because they can tell you anything you wanna -- I will tell you one thing we noticed yesterday that's an important to all this is that with the announcement of this trillion dollar plus price tag.
We're seeing the administration.
Dial back a little bit on expectations for how this at all turnout Kathleen Sebelius the secretary of health and human services giving purposefully giving an interview to the Associated Press last night saying that the administration would welcome.
Phasing this in -- sticker shock I think it could have an impact on and how quickly this moved forward.
I guess at what it train between pac exactly and Peter interest -- you -- is in talking to traders and you you look at these sites are most stocks are rising today.
Drug Sox held in there yesterday actually coming back today -- so.
There does seem to be a sense it may be if could not be as dramatic -- change at least that's the take illustrated the -- changes with every press conference obviously that comes out of DC but.
-- do you notice it's -- you talk about dialing it back is that sort of becoming the prevailing perception -- of barges beyond lowered -- -- -- they can be clear later.
Perhaps now and then you're also saying this whole idea of the public health care company that would be -- by the government that's.
It's it's unclear that's getting much traction here and that may be.
The solution the compromise to get something done here would be this idea from senator Kent Conrad chairman of the budget committee to set up.
Co ops of some kind in and in theory.
That might mean more business for some of these HMOs and and that one thing that definitely would mean more business for HMOs and health care companies would be.
Expanding the number of people who would get covered one way or another and some -- some of that -- even if he just added sixteen million people.
Well you know that that's that's new business that could be paid for and could it could benefit some of these health care company so that's another thing that there.
Street might be reacting to.
Yeah that's true Peter I've heard a couple of people talking about that it is trying to figure out what does it mean for the margins but it could mean new revenue -- so.
-- -- -- I Peter thank you very -- that update from pagan need -- on easy now for your net next time I millionaire -- how -- -- the -- that -- lifeline.
Why lines like I invite you Napoli but I Peter Bryant and speed because there is -- -- you know guys that.
-- -- I couldn't China joining stats we've had a lot and different comments about twelve you know -- the list on real nice comments to each of -- you told me that.
I was your life -- I looked up and the -- I.
It -- work on Madoff yes we had.
When I was data court calling the -- emailing each other continuously.
I really that was that was a good team are sound you were providing me with the facts I was providing you with the law at a plea was a great teamwork that's how -- and denying all of Ireland born here that's really got to be a 5050.
Our you know between an audience member panel give -- the difference between the Madoff case in this in talking about -- reform is that Madoff was.
As a great story and not the term reform is not but I was don't know how to approach this topic when it comes to health care seems so.
Had an esoteric seeking to break it down for Snow White -- Here here's the argument one -- one of the reasons health care is so expensive is because doctors and must have medical malpractice insurance and -- premiums are so high.
And we have patients pay for the premiums and the reason the premiums are so high.
Is because there -- so many lawsuits and there are some money verdicts which are really out of proportion it is argued.
True the true harm that the patient has suffered.
Because there are.
Areas in the United States where there isn't animus amongst the public against physicians.
And plaintiffs' lawyers know where to bring their -- and it.
Ample as silly I'm -- -- -- silly but let's just put examples -- -- and that is something they get treated wrong for headache.
And did they finance and it was a brain tumor for example that the doctors sued for.
Fifty million dollars are you talking about that type of case where it while I'm talking exorbitant amount I'm -- Tell you about a case not aware of the demand is exorbitant but where the jury verdict is and there are some sites -- -- -- notorious for that.
Including the state where I sat as a life tenured judge New Jersey.
Say you have fifty state court systems remember if you slip and fall on a banana and the supermarket.
Or if a doctor removes the wrong organ from your body obviously something very serious or anything in between that harms the body.
Virtually all of those lawsuits are brought in state court because it is the states that regulate the tort systems the State's job.
Among others is to keep you safe so the state provide the state provides a -- for it means to redress when you're not safe.
These are not federal cases in Manhattan federal court for the most part there are some exceptions -- in my view relevant for this conversation so you're really have.
Fifty separate tort systems if you're playing if you want to sue in New Jersey because you tend to have jurors.
The reason why has a long political historical psychological study.
For another time but you have a jurors who tended to favor the point of your defendant you wanna be and Texas which used to be the most pro plaintiff in a state.
But since governor George W.
Bush and a Republican legislature radically changed the procedures in Texas now defendants want to be there.
How do you change that system and there's a couple of proposals out there would -- yet to what changes are we talking about here for -- -- -- -- -- we're talking about we're talking about changes as radical as if you were injured by a doctor or the banana -- in the supermarket you can't so.
You can't get a jury in a judge would go before a panel of three people authorized by the state to dispense money in your behalf.
That removes the type of excessive.
For -- sympathetic.
Plaintiff -- juries sometimes tend to award particularly New Jersey and don't mean to pick -- New Jersey and most familiar with it and it's among the more liberal state so that is one of the proposals and other is the legislature -- state will put a cap on the towards the matter what you're -- about a what the doctor has done.
To you no matter what your pain and suffering the maximum award is -- -- military.
Between zero and a million bucks or what -- that would -- -- -- less than a million the proposals are usually in the nature 350000.
Sometimes they're a multiple.
Of what medical bills you had today in order to repair.
The harm that out of your medical bills averaging ten million that you would.
-- potential ten million -- medical those we almost unheard of your medical bills were 101000 you can get 35000 and in in judgment so.
Those are the type of proposals that are out there the real question.
-- -- Jenna was driving at is where will the reform come from.
There are impatient people in the congress who don't wanna wait for the other states -- -- themselves like Texas did and they want the congress to dictate to the states what to do.
That would have -- the concept of federalism because the congress can't tell the states what to do I -- the congress can't say.
Chris Christie and not Jon Corzine is going to be the governor of New Jersey the people of New Jersey have to do that right.
Some early in the congress can't say the New Jersey you can't have judges and juries only the legislature if they can I.
I think that we need to get through this part of the reform before we can even talk about national health care -- plan like -- -- my own view is that it's a little subtle and and it is it is generated by my experience in the government and my fear of too much power in one place and and that place that I always fears Washington DC.
So we're putting the cart for the horse maybe here well if we want to control health care costs and of one of the mechanisms of controlling health care costs is to control.
This runaway litigation.
It has to be regulated in each of the fifty states by each of the -- -- states if congress dictates to the states what it wants to do.
That destroys the concept of federalists may be found -- constitutional at some point on the line precisely.
Federalism is of course a check.
On the federal government's power by keeping certain areas of human behavior.
In the states and immune from congress and congress has -- insidious ways to violate -- For example when congress wanted to lower the speed limit to 55.
It's lawyers told them you don't have the authority to dictated 55 mile an hour speed -- -- But they can -- the states.
They can go to South Dakota.
I -- that for resulting in a minute and say those federal highways and South Dakota hears a hundred million dollars to we -- them.
But as a condition for -- hundred million you've got to lower the speed limit to 55 South Dakota -- Elizabeth Dole who was secretary of the treasury saying.
We want the hundred million but we don't want to change the speed limit because that's not an area congress can control the Supreme Court said you want the money take the strengths.
So if congress wants to regulate an area that is not given to -- under the -- regulation.
It can do so by bribing literally bribing the states -- you -- I went to South Dakota and said here's a hundred million not do that -- be arrested deported as the statement.
But when congress does it.
-- can get away with it wrote a book about the -- the state -- are raising the drinking age same thing.
Same thing congress congress raised us just -- -- walk right lowered the speed limit lowered the blood alcohol content before person can be convicted of -- is presumed it.
Guilty of DW I.
All by giving money into the states the states took -- South Dakota resisted when the Supreme Court said the South Dakota.
Take the money with the strings what do you think it hit it took the money -- took the money they'll suddenly it's states' rights principles evaporated.
100 million dollar check showed up on the governor's desk.
It's funny how that went -- -- what -- we have -- -- -- -- -- to justice for Fox -- she tends to do this in the middle of the show you know so not only did -- take today off and it left me here than then just takes off the edges of the have to do something I'm glad I went yeah that's just what I -- on -- -- Folks you know viewing at home here -- questions here.
-- he should never get anywhere or doing 55 miles per hour and no its not Sammy Hagar is.
Commenting here but interesting in medical -- while we have -- -- one of the big knock questions of the day is financial overhaul.
You know and and putting the Fed in here with a -- -- -- -- just.
What are your thoughts constitutionally on bill and I'm on the Ron Paul -- thought so too to me this -- Soviet style central planning.
Now the government produced its 85 page summary of the proposal it's not the actual proposal itself.
If you go back pages December -- pages to summarize we'll probably be for 500 right is that nobody Robert nobody in the congress will read before they were out of Denver right.
Nevertheless these 85 page is about half of which I've read already and I'll send out my usually not everybody -- a little while I finish it.
Basically stands for the proposition.
That the government is going to ask the congress the executive branch has the congress for power.
To regulate not only financial institutions but all institutions owned by financial institutions.
Right and it virtually any company in America the failure of which that's a quote would in the opinion of the Fed adversely affect the economy.
So that would be the camel's nose under the -- For the government regulation of private industry that has nothing to do.
With government authority or heretofore government regulation right they would be able had been going to say well this you pose a systemic risks we've got to shut you down here.
If not give an -- -- if this legislation passes and the government thinks McDonald's has too many.
Or too few franchises in a certain part of the country it can order them to change.
If the government thinks that there's too much she is in the McDonald's cheeseburger.
And that might adversely affect health care in that area the government can order my -- McDonald's to change its recipe Jefferson would be flipping in his gritty.
If he knew that the constitution some how could possibly authorize the feds to do this but that's what President Obama wants me.
Get some of -- onions -- -- to the that's a desperate barking at that point is they don't have a choice and you want she's that you want -- into Joe's right you don't wait for a federal bureaucrat to choose -- -- -- absolutely not what -- babies.
-- -- -- -- Thanks so much for getting it's -- -- I don't know took a little bit here -- -- you have this beautiful studio for this wonderful foxbusiness.com.
Those of us on the fox whose side have strategy -- it's like a classic got fairness I don't -- in trouble for saying this but I have to say it.
It's magnificent here we're just temporary.
Uses a disparity in what's on the I've only talked a visceral issue to go check it out you have an iPhone you can.
Watch the show struggling business people also get better.
This better phones -- an -- our -- in the new.
Panel -- and I watch it on my Blackberry had not yet and I.
Davidson -- -- president so much for joining right or needs Jana are right back well -- You'll be back she's always -- trust me they know as soon as she walks away -- -- anyway just apology on a thanks so much will be right back and dissect.
All right welcome back here -- quick check of the markets moving a little bit higher now again delta between gains and losses and where.
Talking about Health Care Reform here today and we ought to welcome that doctor garrison -- he is the president and founder of -- alliance medical group.
Based out in Seattle and thanks much doctor -- for joining us here.
You we talk a lot about health care and in reforming health care and in your company is seeking to do that.
Eliminating the -- as you say insurance the insurance company a lot of people would like to eliminate them perhaps from their lives -- charging patients a flat monthly fee -- for round the clock primary care mean this is sort of like the concierge service that today maybe people -- familiar -- Talk -- us a little bit about the model in your monthly -- what sorts of services are involved people who are not familiar with this.
Well is this is actually an an idea that's been around for a long time as you say.
Originally with concierge practices and we're really looking for the next level the next evolution of this for something -- affordable and available to large numbers of people.
-- -- at a price that that they really can that they can really make use.
Where what were interested in is practice in which the doctor and the patient have an arrangement the patient pays the doctor the doctor provides.
For a fixed monthly fee.
What we're interest it is increasing access.
Eliminating the insurance middleman as you say.
And improving the quality and effectiveness of the care.
In the services that we provide.
In primary care actually quite simple most of this is just human to human interaction.
You sit in a room with somebody you have a conversation you do an exam you provide treatment and many go home.
In the current world that interaction.
That about twenty book keepers get involved.
Both on our side and on the insurance company's side and there's not -- no value added by that any of those transaction.
Interference -- so when you eliminate all of that means the doctor's office spends their time taking care patients.
They can have half hour visits one hour physical exams in our case we're spending the money we're saving -- -- being open seven days a week.
A twelve hours a day Monday through Friday.
So it's it and also -- working directly for your -- now not for their insurance company so you have to provide that service or they won't come see you.
-- so it how your profit margins in this business compared to say a traditional DO doctors practice would be with the insurance companies involved.
Well it's not so much the profit margin that's the issue it's actually how many patients to data you have to see to make a living.
So in the current system doctors are seeing thirty to 35 patients today average face -- eight minutes.
In our office we can provide an average -- closer to 45 minutes.
And that changes the quality of the work it means that you can see people of multiple problems on the and in one visit you know -- have to make them come back.
We also don't have to bring them in the office to take care of them we can take care more over the -- we can do it by email.
They're so there a lot of ways that that people can get their care that's efficient and effective for them.
So as we move into this for -- and talking a lot about -- -- -- on the iPhone here.
Would this be something where it may be here you are getting treatment.
Analysts say in the -- -- chat or email but is that where where it's kind to me is that sort of the future.
Of some of these visits that would be sort of preliminary before you actually come -- to the doctor's office.
Well we actually schedule visits up over over the phone so.
-- if you've got something that really doesn't require that you traveled twenty miles to see me right then we'll just talk about it over the phone and you actually need to seemingly well or if you need to send me a photo of your rash and I'll tell you what to do about it rather than -- you -- CN insurance insurance driven -- practices you have to see people in the office you don't get paid.
In our office we get -- taking care of people in whatever way that has to happen.
Now what about all of our all of the technology may may actually come and use.
And and -- and many of our practice and what about emergency -- -- how does that factor into your monthly bills and and into your staff as well.
Well we can handle a lot of the things that emergency rooms would be handling.
So so if somebody is passing a kidney stone.
Instead of going to emergency room and waiting six hours and getting a full physical example someone has never met you before.
I'm having a bunch of labs done and ended and all kinds of studies done you can go see your doctor.
In his office on Saturday.
And and if you and we can do that this simple diagnostics that you really require for that we already know you we don't have to.
We don't have to reinvent the wheel when you write down.
When we can get treated so there's a lot we we can actually greatly reduce the downstream costs in health care and is a lot of data to support that right now.
And so we can weaken their summer early differences that having -- primary care home available for you.
May reduce the amount of hospitalization require by up to 50%.
Flying and talk about emergency careless -- -- out say yes someone in the Seattle area is visiting someone here in New York they get into trouble what did they do for care.
How does that work.
Well I think you know -- it that there there's number of ways that we can handle that if it's something that we can do by -- -- do it by far.
But if they were published an emergency -- -- visit -- or something on this -- if it requires an ER visit than what I can do on my -- is I consented to page summary of their history.
To the emergency room physician.
And make sure that I have contact with that person so that they don't they -- -- seeing this person for the first time in their lives.
And they also don't have to spend half an hour collecting the data that I can provide for them right but -- should we can simplify that as well and make it less expensive more effective interaction buddy you -- you didn't if you are patient they're still need to carry some form of insurance obviously if -- -- -- Traveling outside the early when -- here very much encourage people to have some kind of insurance.
But if they have -- that they have primary care monthly.
All the bells and whistles insurance.
So they may be able to buyout of -- higher deductible plan.
And and then it if we can keep them from even having to get into their deductible by -- provides only the services in house then they will save a lot of money.
Are you know -- that we can we can project for -- for the patients who were.
Who are seeing us in as individuals that they may save as much as forty to 50% on the health care costs and year and for businesses that want to provide this service.
For their for their employees wind or without high deductible health plans they can also be saving as much as twenty to 30%.
On their health care costs.
And that what they -- year.
You're thinking about expanding of the business I believe are you concerned about any legal issues if you're moving outside the borders of the state of Washington.
Well -- -- as you know a lot of what what goes on health care is state by state and particularly in the insurance round.
But we've had very good reception here and we have a very good understanding with the insurance commissioner here.
And and everyone here is beginning to appreciate how much this can do.
Both for the quality of care and access to care but also to resuscitate primary care which is that which is say an endangered species in the United States.
Well doctor -- -- -- up to come back and give us an update on this expansion plans and how things are going we do appreciate you sharing your time doctor garrison -- President and founder of -- alliance medical group in Seattle have a good day sir.
-- my pleasure.
All right guys -- moving higher by about 26 points Jenna has rejoined us and in fact.
-- take a quick break and then we'll rejoin you in just a minute.
That was day.
The magnificent drama I was -- not come alive yes let people about it happened a couple of appearance of the show we need to have a lot of it behind -- -- -- -- I lift you doctor Parkinson doctor Parkinson is doing and give a virtual practice for gonna continue this conversation on health care because it is important.
And he did it police are talking all the different options out there.
That are already out there in the marketplace is interesting to see what actually is available so.
I virtual practicing -- back in 2007 and continuing that -- practiced today.
Yes but I think he couldn't -- at a -- practice because the first visit as -- -- in person and then after that it's just -- -- communicate nowadays via email I am.
I text message text message that I -- text -- you and -- you know -- my eyes -- -- and -- a -- and -- that the best medium -- -- period.
Complaining so much for lessons to girl lately anything like that yeah I felt really concerned about it.
Now it's more about it's a good week we -- text messaging to and.
To really just schedules visits and things like that with you to remind you hasn't worked out -- -- it works great.
-- -- what is it as their like caffeine that's associated with a monthly fee or how does it Heidi actually operate your business.
-- -- that's that we have in its authority our government he.
And then anywhere from a hundred to 200 dollars depending on how much time -- with your doctor so okay for example I have health insurance couple years ago.
I was freelancing as journalists hard to get insurance in the city New York.
It was OK he's here in California means it in New York is really hard.
So if I was -- -- Not covered I could have called that -- -- and have insurance and I'd like to use your services and it would cost me 35 dollars a month plus.
A hundred dollars per visit me around yes pay little -- -- there it's very telling patients to -- we've heard of.
At a thousand patients since last August come through our doors.
So not so bad.
It didn't -- like they're being read it and it's like up court this sounds so obviously that.
On FaceBook -- Yeah yeah -- -- mean you know it's not like you're very much using did manually and electronic media and social media.
To expand your practice then definitely I mean you -- -- -- many people complain of being sick or having -- -- -- having the flu and Twitter so I don't have a great benefit.
Yeah how do you immediately think they were searched by you know zip code 112 and one sick or something like that there's a few people.
That's OK so -- it.
At the US have colleagues though that that obviously operate not operate actually like -- patient this.
-- with the it -- traditional system of that insurance or HMOs or what you know just a more traditional set up to doctor's office.
Are there any drawbacks or is there anything that -- had to work through challenges that you had to overcome because you are.
Operating do you -- intended that any new structure.
Yeah definitely -- -- -- for example you know.
A woman came into our practice a few weeks ago and had an abnormal pap smear.
Yeah and request immediately you know the charges that you know fifty dollars for a pap smear.
But -- if it's abnormal they don't contact -- -- at all.
And just do another testament to the test the cost 700 I got so that the patient has to pay the answer of course respect that but that he did -- We can't do anything that's the nature of the health care system they try to take advantage of cash paying -- Suspect I -- -- get the option of like -- and maybe I don't wanna get that test and again and get a second.
Would you care they birdied them that they right now they don't actually move forward and to get your permission to that body of doctor tremendously.
So what do you think about things they knew that this -- we have tended planted the health care system.
Is it surprising that that you likening operating kind of free -- -- the insurance industry I mean.
You -- mention that other kind of clots -- event that the laboratory tests that.
Does anything stand out to US like maybe you should consider.
And a couple different angles here -- what he thinks so far.
-- -- -- out because the only way to innovate and health care delivery is to do it strictly within the caste system.
Because if he tried to innovate its first say you know video -- -- I am visits -- -- insurance companies don't pay for that.
And they're always like ten years behind the times.
We can't really innovate to redefine how health care is delivered in America and that's what we're trying to do -- question what it means to visit a doctor or receive health care.
Yeah it's funny I I worked in doctor's office and high school because I thought going to the doctor and I still -- -- the medical medicine and -- But I was an office working when HMOs -- and and in the nineties and the doctors were so we had to turn over seventy persistence of course I was with the file.
Girl right stuff I got to see it firsthand that it was discouraging not only me but to the doctors because they had -- so much time.
Away from their patients to deal with.
These logistics that.
They weren't at that time train for a New Hampshire medical school has changed a little bit incentive to -- -- that but.
Keep the young guy like actually -- what did you do find that you're able because you got the deal with this how has your behavior interaction with the patients changed.
Well in our practice and we certainly have three doctors we have no staff from wealth of delivered -- younger units set yourself -- -- -- I don't know we just use our technology.
To streamline the process of health care delivery so that we just streamlined all the humans out that the doctors.
And so at their practices like yours either and Williamsburg -- it -- its New York if -- -- hit kind of cool area and I -- -- system -- San Francisco -- people are open to that.
Is there any type of like -- community or wait for our viewers that are around the country.
And to find doctors an area that might have some.
Solar system but -- pacing around the practice in Williamsburg to develop our technology it's called hello health.
And basically the platform like.
FaceBook -- -- secure has a complaint FaceBook where doctors have profiles.
Use the patient have the profanity create a profile friend the doctor befriending a -- that means you can allow them to read and write to your medical records.
And then you can schedule your appointment on the platform and then you -- -- -- person after that that tell email I am a video chat -- -- the platform just like Gmail.
A little bit like having your child and she want the patients have no word is despite I think of guys you know -- and buying even about the evidence -- -- to not not having that be a doctor patient interaction.
We're just actually you know you -- for spreading drags rates haven't -- had the flu like if you want to give them that.
And I think any sort of you know feeling -- -- comfort doctors will bring that yeah.
Yes that's I mean they're not spending that at all because -- going to be as safe as they possibly can that there -- an inconvenience to the patient and the problem is so little.
And the doctor knows that patient.
Has a relationship with them and keep in mind is that in prison.
Visit is always the first is that so we always have an in person establishing.
Relationship and which -- about tort reform medical malpractice.
What is your insurance company say when you talk to them about you when you're getting your medical malpractice insurance.
About your -- -- practices he's being a little bit alternative different than many others.
To -- look at you sideways or what was the reception when you -- talking to them.
-- actually it's actually safer way to practice medicine because of the patient has direct access to you and you you know.
Taken responsibility take care of your patients -- the safer way to practice medicine to me it's very unsafe for a doctor to say.
Discharge you from the ER and -- totally disconnected from him.
So our way of practicing medicine is much safer I think and the insurance premiums have proven that and any.
Most times -- -- an insurance company comes into the doctor's office and sees that they have unfettered access and are using electronic medical record.
There are premiums are lower because.
Everything is documented.
And -- accessible so.
I wish I knew that I -- is.
Think I actually had health insurance by 2007 I wish I had known about service like this it's so cool will need to keep in mind this isn't health insurance at all and we looked at -- it -- even had access to health care right now.
-- a little daunting when you're uninsured to.
It's gonna that I -- and saying they went to see the doctor related doing they paid a 130 bucks you know it's it's it's expensive.
We never know what you gonna face in some cases.
Good to know when you are your rates but published early they are definitely -- -- every doctor's profile there's a and there are published rates okay.
Called my back notre hang up front that's -- first.
Let's and it had to check it out online thank you -- parking takes a much.
Look at our right.
I Liz -- going to be talking TARP.
It's just -- moment.
Very first day that things can pay back -- and they finished the woman thank goodness she's -- It's their right is no announcement we've like talked much about that -- more.
-- -- -- -- -- it's live there where we're getting her seated in accommodate here I think she's all like to but it got better in progress this and that this is definitely just look at these stocks and clearly need a hair -- us Bancorp -- up a little bit so deviancy down.
Does -- it's been PT hey talked about a day they're getting.
Today TARP gang -- so it's an anagram talk to us about it what's going back of the banks are payback TARP and got a list that got JPMorgan.
-- -- Goldman Sachs US Bancorp Capital One.
Or -- the -- back in new York Mellon gang and State Street court.
It's -- to -- they did their pay back -- the recipe.
Downgraded by 22 band that was it downgraded on the list here -- US Bancorp Capital One.
Other banks not -- pay back TARP Citigroup Bank of America of course Wells Fargo.
PNC financial suntrust.
-- -- fifth third Regions Financial I have when those were downgraded to PNC centrist KeyCorp -- -- -- I think he lacked the money.
You know they're doing you are doing equity raises which means it's very diluted ticket I can only give the money they get this ten billion dollars that had they had to do it it -- -- -- -- wire transfer -- -- like anybody.
I didn't have my back like -- -- They have -- just like veterans service department of -- and all the here.
Back then I got.
What they have a question senior -- Dick Parsons the chairman of Citigroup says look you know we're at a really competitive disadvantage you know well you know you're on the hook.
45 billion dollars in TARP money and 306 billion dollar backed -- from the government even if -- it isn't complaining in one city executives said look you know they're getting pay caps right executive pay caps administration's coming down even tougher pay caps.
I was told look I'm gonna move to socialist Sweden look at -- my socialist dollar working for a firm they're so that's the key question for these banks that are still on that are.
That is -- losing star.
Performers off -- trading -- we need them.
To create the money to pay back the taxpayer tanks so that's that's it -- we are seeing headlines you know that what happens the money that is given back from -- to me now.
Big gets put at such time they go to that feeder line to other the -- write it get hit with commercial long problems and other regionals that's I think the idea and that's so the question is we don't know because what we're making money on some that dividend payments right.
Question -- -- see this permanent as a my apartment permanent -- regulatory landscape probably.
And now we -- -- -- -- the administration time that a regulatory overhaul.
I -- that you had affairs -- didn't have the power to wind down and you know AIG or Bear Stearns conspirators and investment bank regulator in the SEC.
It kills the incessant and kill missions have an idea.
I think anyone we had that we've had since 1991 systemic risk regulation rules on the books where they could wind down.
He's too big to fail or too big to succeed where we want -- Banks and they've been out there isn't that we have not a shortage.
Regulations but a shortage of regulatory -- -- could say -- like six regulators -- and that's.
-- officials you know told me that look we don't know who were answering to anymore.
And then in and you've got to think there's some -- -- some decent fighting going on you can find it absolutely is an acquaintance bring up our great because.
The financial services sector the insurance industry by far away in the -- and the real statistic the biggest contributors to congressional committees so that.
Fuels the turf -- that -- goes on in other words the donations.
From the financial services right -- to congressional committees that oversee them.
You know for a seventeen million dollars came in last year from the financial services sector and to congress imagine that on -- on their -- yeah it's a specific commodities futures trading commission you know which.
Regulates credit default swaps moment.
Well guess what the agricultural committees in congress shall receive the CFTC and me they got the most donations from this and answer.
-- my head is then slamming.
Are we hearing a lot of is -- in it like if this is this.
What how we did keep track finished.
It kind of things like what does this targets.
Actually it was an acronym coming from one for her target -- And hard hit from -- mind -- -- is short for targeted at women and I and the me violent threat.
What happened and we didn't mean it seems that this is -- news is still like hasn't a year since -- is being given out but this is you mention is kind of a freshman and seems like there's revolving door of money coming in protesting us going out so.
When to get rid of that revolving door or are we ever.
Are we ever and remember this is that it will probably not for a long time I mean this could be -- -- a permanent rate through landscape.
-- this was sent built out of a three page document that -- -- I think.
You know -- -- -- I say I want this now.
And he's won by the way who really launch this idea about in a systemic.
Will it work -- you can't legislate out of existence read.
And corruption and -- being with us it's been around since Adam and you know so well and let me just get this is there -- risk with.
But some of these they states -- to -- -- back too quickly that's a good question yeah that's what happens then do we don't want them coming back for more that's right.
That's right are they yeah I they too eager to get out of the away from the regulatory -- But came back yeah and when they need the money yes sure that's it.
Key concern you know illustration -- mentioned that on the fox -- -- on the Fox Business Network the president that his office speaking at this time talking about regulation reform really know a lot of the details from his speech.
I there's a look at the president and giving his talk about regulation.
And that the new overhaul for the -- to -- the biggest that we've seen in eighty years so this is quite a historic day Al Davis doing.
A lot of -- -- what I think -- the question -- -- get rid of the Office of Thrift Supervision which oversaw the IG and fell down miserably on the job.
I you don't sound like they may they and made some regulatory news of course in -- regulatory mystics in the past the SEC let the investment bank lighten up and their capital -- in 2004.
Under then Treasury Secretary John Snow.
And you know they were under capitalized so that's when it.
Really start to get out of hand credit default swaps I talk like sixty you know trillion dollar notional value and yeah that's right.
And the other -- to gang in this is very important you know sometimes you get these regulatory bodies that sit.
Parked warehousing sleepy suburbs.
You know should -- be on the scene here -- and be honest right here in New York City is certainly say that with an era.
This is a new organization -- the New York stock exchange regulatory body was folded up into right Bindra.
Right thing -- supposed to be tracking all sorts of traits.
And what have you but you know that it would -- the New York Stock Exchange to the big -- it kept its regulatory body could they have caught the scam trades.
That work made by Bernie Madoff you know so that's -- key question I think for regulators -- you have too many what is too many.
You know do you just need more -- -- -- up markup let's let an hour to figure it out and then I know that that's an hour but let me not to launch the.
The market crossing guards here where -- you know.
It's like institutionalized Cuban -- getting -- miscreants and crooks on Wall Street and get away with saying.
You know equivalent of yes no maybe so they -- -- -- to deny or admit to what they've done and they get the directors and officers insurance to pay for this is an insurance companies regulated on the state level and they were able to get get the credit default swaps and -- gonna talk Clinton that way yet there will be no federal charter rob regulatory body.
-- insurance industry.
Let's remember too that the timing on this these new regulations that we're hearing about and and how what you remember this is the proposals so there's still the couple steps before it actually.
Goes into effect right now it's my understand yet also we have some banks paying back TARP money.
But we are now at the end of the first quarter we're just going to the second quarter now given -- if you heard anything about what the second quarter -- some of these big banks is actually gonna look like or at least the -- the year.
You know -- What I what I do it's yeah in case you can't have a market recovery Carriker repentant financials right and I ran right at us -- -- right yet it's so I think that you -- is still facing thin trading choppy trading.
And it's getting some of that I think this meaningful -- so to -- incident with a range of things getting a little gray around the temples.
And it's not based on pretty thin volume with not a junkie stocks that are highly leveraged buy and yet happen.
You know small cap and probably not a huge coincidence that did during this huge run.
The banks were -- then sell more stock into the run yeah.
And -- back -- at the same time that's right and you know it's a few people are watching that is is an interest -- -- now that they've got nine out of TARP.
Now what to the idea that you know the fires -- -- -- bullish signal for the banks that they can do that right it is a policy that that they included I think shareholders with an equity -- Questions are dim -- the demand come from initially and then were they part of that's a different story that I have a threat.
Also so they get to see in this report from where such a vote earlier yesterday I think it would be very interesting you talk about you with the shadow banking system sort of -- at least for awhile.
That stocks and riskier assets may not follow the money flowing in the -- -- you follow the money flowing into the economy and president levels by the Fed but credit.
Moving lower and we've senior coming out of the ninety's CO -- now we've solved.
Stocks riskier assets following credit -- I didn't follow the money necessarily bouncing out of concern that -- -- -- credit lower even as money supply is going.
I have what we want to see was this securitization market that has been iced over to start to do you -- wanna see deep crossing the credit markets see that with the corporate.
And the junk bond spreads on getting easing up easing up a bit.
And so yet so but the question is how does what is the Fed's exit strategy.
The fiscal fed -- -- -- the -- waiting deeper into fiscal territory by monetizing treasuries.
To and paying for this gargantuan government spending that -- and opened fire hydrant.
A government spending -- so you don't want the bond -- to say hey wait a second we expect more inflation rate that is monetizing the treasury debt.
And so we're gonna demand inflation premiums driving bond yields higher and driving mortgage rates higher she's been -- trying to.
Yeah have housing mark yeah that's right and the other issue too is how do you get what -- -- -- Extricate out.
This massive amount of liquidity that the Fed has pumped and we do is you sell bonds have mop up that cash right replaced the cast in the system with bond.
-- -- -- -- -- -- -- And those bonds it's mop but the feds massive liquidity injections will compete with the Treasury's debt -- right.
So bond yields could be driven higher so to you know pay off that interest by the way about a 45 billion annually -- -- on the public debt.
That's -- -- to the budget about twelve different government agencies okay.
So you know when you start to do that you know you risk -- double dip recession this is -- the Fed is meeting next week.
We either face massive inflation that's a big danger or double dip recession -- extricating.
Al all of that liquidity of the sun rather come I -- as any -- -- -- money is now flowing underneath their mattresses that if I.
Let me -- -- her brilliant thank you -- -- -- it eighteen day.
Eight to -- wow hey look at that.
The hours gone it's gone marks there about -- excellent -- and Obama is speaking right now we'll be back in the eastern time check this out and I think everybody in Berlin.
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