PRICES.
STUART: YOU GOT IT.
GRADY TRIMBLE, THANK YOU VERY
MUCH, INDEED.
PLEASE SHOW ME YIELD ON THE
10-YEAR TREASURY.
ACTUALLY, IT’S MOVED UP A
LITTLE, 3.64%.
BUT THAT YIELD IS WAY BELOW
WHERE IT WAS JUST A COUPLE OF
WEEKS AGO.
LARRY KUDLOW JOINS ME NOW.
LARRY, I WANT TO TALK ABOUT THIS
SHARP DECLINE IN RATES, THE
10-YEAR AT 3.65, THE 2-YEAR WELL
ABOVE 4%.
THAT’S A DECLINE IN RATE.
WHY IS IT HAPPENING AND WHAT
DOES IT MEAN?
>> WELL, I DON’T KNOW WHAT IS
HAPPENING, AND I DON’T KNOW WHAT
IT MEANS.
[LAUGHTER]
I MEAN, YOU’RE TALKING ABOUT A
COUPLE DAYS OF TRADING.
YOU KNOW, LOOK, THE 2-YEAR MOTE
HAS GONE UP 340 BASIS POINTS
YEAR TO DATE, SO THAT’S A TREND.
THE 10-YEAR IS UP 220 BASIS
POINTS YEAR TO DATE.
SO THIS HAS BEEN A TREMENDOUS
INCREASE.
BY THE WAY, MORTGAGE RATES HAVE
GONE UP OVER 7% NOW.
THEY’RE UP ABOUT 350 BASIS
POINTS.
SO, STU, I WOULD NOT PUT ANY
STOCK IN THE SHORT-TERM WIGGLES
AND WOBBLES IN THIS MARKET.
INTEREST RATES ARE GOING HIGHER.
THE FEDERAL RESERVE IS GOING TO
HAVE TO CONTINUE TO TIGHTEN
BECAUSE UNDERLYING INFLATION IS
STILL RUNNING AROUND 7%.
THAT’S MORE THAN THREE TIMES
THEIR 2% TARGET.
I MEAN, I THINK THERE’S ALWAYS
SPECULATION MT. BOND MARKET --
IN THE BOND MARKET.
FOR EXAMPLE, YESTERDAY THE ISM
MANUFACTURING REPORT CAME OUT,
AND IT WAS SOFT.
SO WHAT THEY’RE SAYING IS BAD
NEWS FOR THE ECONOMY IS GOOD
NEWS FOR THE POTENTIAL OF LOWER
INTEREST RATES OR LESS FED
TIGHTENING.
THAT’S NOT THE GAME THE FED IS
PLAYING, AND I WOULDN’T BETTEN
ON LOWER INTEREST RATES AT ALL.
I THINK THAT 10-YEAR NOTE -- I
THINK ALL THESE RATES ARE GOING
TO CONTINUE TO GO HIGHER.
STUART: NOW, YOU DON’T ALWAYS
USUALLY SPEAK DIRECTLY TO THE
STOCK MARKET, BUT JUDGING FROM
WHAT YOU’VE BEEN SAYING, IT
SEEMS THAT YOU DON’T HOLD MUCH
STORE IN THIS 2-DAY RALLY THAT
WE’VE GOT.
YOU DON’T THINK IT’S GOING TO GO
VERY FAR, CORRECT?
>> CORRECT.
LOOK, IT’S, AGAIN, IT’S HARD TO
EXPLAIN THESE SHORT-TERM WIGGLES
AND WOBBLES.
AND I DON’T THINK ANY HUMAN
BEING CAN OUTPLAY THAT.
THAT’S WHY I THINK STOCKS FOR
THE LONG RUN, THE S&P INDEX FOR
THE LONG RUN, IS ALWAYS THE BEST
INVESTMENT.
BET ON AMERICA AND AMERICAN
PROSPERITY.
WE DON’T HAVE MUCH OF IT NOW,
BUT THE CAVALRY’S COMING, AND
WE’LL BIN BEGIN TO STRAIGHTEN
THINGS OUT SOON.
I LOVE RELIEF RALLY.
THE KUDLOW TRUST LOVES RELIEF
RALLIES.
[LAUGHTER]
BUT RIGHT NOW I’M NOT SO SURE
THAT RELIEF RALLIES CAN BE
DEPENDED UPON.
STUART: SO DOES MY 401(K).
>> YES.
STUART: THE WEST COAST PRICE OF
GAS, $6.41 IN CALIFORNIA, IS
THAT GOING TO ADD TO NATIONAL
INFLATION?
>> WELL, LOOK, NOT PER SE.
I MEAN, I THINK YOUR REPORTER,
GRADY, IF OPEC+ CUTS PRODUCTION
WHICH WOULD BE A VERY STUPID
THING FOR THEM TO DO FOR A LOT
OF REASONS -- GLOBAL POLITICS,
RUSSIA, UKRAINE, U.S.
RELATIONS -- BUT IF THIS WERE TO
DO THAT AND THE PRICE OF OIL
JUMPS BACK OVER $100, 120 A
BARREL, GASOLINE PRICES ARE
GOING TO SURGE AGAIN NATIONWIDE.
RIGHT NOW THEY’RE UP ABOUT 5 OR
6 CENTS NATIONWIDE.
BUT, NO, CALIFORNIA’S
CALIFORNIA.
RIGHT?
HAIR PROBLEM IS NO PIPELINES OR
INSUFFICIENT PIPELINES,
INSUFFICIENT OIL, INSUFFICIENT
GAS LEAP, RIGHT?
THAT’S THE PROBLEM -- GASOLINE.
CALIFORNIA HAS AIR-CONDITIONING
EVERYWHERE, BUT YOU’RE NOT
ALLOWED TO USE IT.
CALIFORNIA HAS ELECTRIC
VEHICLES, BUT YOU’RE NOT ALLOWED
TO PLUG YOU ARE THE IN AND
RECHARGE THEM BECAUSE THEY DON’T
HAVE ELECTRICITY BECAUSE THEY
DON’T HAVE NATCH NATURAL GAS --
STUART: CALIFORNIA’S PROBLEM IS
THEY’VE GOT GOVERNOR BEGAN
NEWSOM WHO IS AN UBER-GREEN KIND
OF GUY.
[LAUGHTER]
I’VE GOT TO GO WITH, LARRY.
I’LL BE WATCHING YOU THIS
AFTERNOON.
STOP LAUGHING.
I WILL WATCH YOU --
>> [INAUDIBLE]