Jan 11, 2013|
CNBC's Larry Kudlow on the Economy and Lew Jack
Transcript - Not for consumer use. Robot overlords only. Will not be accurate.
1044. Here at the financial exchange -- not a filling in for Barry Armstrong along side. June night and we are joined now by Larry Kudlow from the Kabul report on CNBC and Larry how are you this morning. So let's let's get into some of the news from yesterday the big news coming out the Obama administration officially nominating Jack Lew Ford Treasury Secretary. Not really unexpected choice someone who's very familiar to folks down in Washington what's your take on the back. I think it's a very cortex. I don't think he's qualified I don't think he has. Any potential standing on Wall Street or the world markets that are picky as an international. Stature or particular understanding. I think he's just kind of a loyal left liberal part of Obama's inner circle I think he's a big taxer. And I -- is that -- he does not he does not get along. With Republicans the stories are all over town. John Boehner couldn't deal with them in the talks until like eleven and had to get him out of the room so I just see Lewis is sort of you know pick Bull Terrier type guy. Touted Obama's policies and that not seriously looking for a deal. And we do have this debt ceiling debate that's gonna be coming up in the next few weeks do you think there's a chance that he's actually confirm before the -- this gonna drag out beyond that debate. I don't think he'll be confirmed by that but I don't know because the debt ceiling. You know that -- push contacts job on the debt ceiling. May not be until March. I and that that's the case I think he will be concerned I mean the Democrats have done about it. And done I'm sure a little get that we'll get the job even now -- -- into the positions. So. I don't see it at that. I don't -- to Republicans. Going after the you know debt ceiling there are people all rhetoric like that I think their principal. Argument is going to be the spending sequester implement the spending -- one point two trillion dollars over ten years. And I think that is the right position people are fed up with spending. And I don't think -- Obama want that. I don't think they want that I mean I think they wanted defense cuts. But I think they wanna raise taxes. And I think that's gonna set up the tremendous confrontation. -- and and digging a little bit more into that we do have the S&P 500 now at a five year high highest level it's been out since before the financial crisis. Obviously this wrangling over the next six weeks is going to be it's gonna get pretty intense down in Washington so. Where do you see the market going based on these negotiations could we have. A repeat of 2011 where we -- see a sizable drop as these negotiations unfold. Well I think you know the risk of any one day drops are always there no question about it but I think the market you know. Watching what we just came through over the tax bill. I think the market believes that somehow at the last minute Washington will get something done -- know whether it was a good campaigner let a good thing. I don't think there's a panic. Over debt default that there was in 2011. And again I think the Republican position is to cut spending which is probably going to be very popular Wall Street I mean. I I haven't two of them are old. Optimist right now on the stock market and the economy and filed optimist I know they're going to be ups and downs that are going to be volatility era as -- step. But at the thought experiment I would suggest that -- competitors. Abroad it is side. I appear nonprofit. Future guidance by corporations. And take careful look at the economy in the fourth quarter is going to be assault quarter probably want to have set but if you look at somebody released -- cutting out. You know factory orders pretty good consumer spending pretty good jobless claims and nonfarm payrolls are all okay. I think the economy here -- -- trend line to. Be totally happen that economy and other fourth quarter could be lower. I'm not I'd like the accident bank expects to kind of leading the market aren't they yeah I think that's very bullish for the overall market. But it surprised growing. C I loans are growing. If that's fabulous story that's not a bad story either. Talking with Larry Kudlow from CNBC and and Larry. One piece of information that came out late last night. Japan announced that they are pursuing what is the equivalent of a 116 billion dollars in stimulus with their new prime minister on a leading the way. It is this something that they're clearly just trying to devalue the currency in order to hopefully encourage exports is that really their game plan here. Well we have spent on stimulus or are Bank of Japan money created. -- this was spending stimulus. I think spending stimulus is worthless and done. Japan already has gigantic deficit to GDP ratio so I think that's a huge mistake I do like though. The fact that Japan wants to read in place. Which is better than inflation. And I don't like the fact. -- -- Tibet as Japanese want the he had. To continue to depreciate. I think that likely that you know and be about -- -- the dollar I think Japan is really separate can be placed in the stock market has done very well as you know. The end had that ball and I don't really he had this week and this ain't got way way way too strong and I think there. Their monetary fight against inflation is -- and OK I don't think this keynesian spending to stop -- ever gonna work didn't work here it never works and it's a big mistake. All right well Larry. Appreciate it coming on with us this morning and certainly we will check in with you next week. All right Larry Kudlow from CNBC coming up. We're gonna be wrapping up the day in the market that's coming up right now after this break on the financial exchange.