IF YOU OWN IT ON THE WAY UP, YOU
THOSE BITES.
CHARLIE GASPARINO, DANGERS OF
RIDING A PUPPY TO THE TOP AND
SEEING IT SUDDENLY REVERSE ON
YOU.
ARGUMENT BEING OTHER PRESIDENTS
THAT DEALT WITH RISING MARKETS,
HOPEFULLY IF IT WAS A SOARING
MARKET, LET IT SPEAK FOR ITSELF.
>> IT WAS A FOOL'S GAME, IT IS
ALWAYS A FOOL'S GAME TO HYPE A
MARKET.
WHEN YOU SEE PEOPLE WALK AROUND
WITH DOW 25,000 HATS, TAKE IT
OFF.
>> IT'S A JINX.
HERE IS THE REASON WHY THE STOCK
MARKET IS BEEN UP UNDER TRUMP,
THE MAIN REASON IS THE ECONOMY.
THE ECONOMY IS GETTING BETTER.
CORRECT BASED ON ON ON A LOT OF
DIFFERENT THINGS.
THEY CORRECT ON OTHER SUITABLE
INVESTMENTS.
NEIL: CORRECT ON GOOD NEWS.
>> BECAUSE OF INFLATION BOND
PRICES ARE GOING DOWN.
AT SOME POINT INVESTORS WILL BUY
BOND, THEN PRICES WILL STOP
GOING DOWN BECAUSE THEY HAVE
DECENT AMOUNT OF YIELD.
UP.
THAT IS WHAT IS HAPPENING NOW.
AT SOME POINT --
>> PEOPLE WILL KEEP SELLING
AND BUY THE BOND BECAUSE YOU
WILL GET A RISK-FREE RETURN FROM
A BOND.
NEIL: BUT WE HAVE THE ADDED
AS WELL, THEY'RE ISSUING MORE
TREASURY NOTES AND BONDS RIGHT
NOW.
NOW YOU HAVE A SUPPLY ISSUE.
>> THE PROBLEM WITH FIGURING OUT
THIS MARKET IS THIS, AND THIS IS
WHERE IT GETS REALLY TRICKY FOR
THE AVERAGE INVESTOR, YOU
SHOULDN'T BE IN THE BOND OR
STOCK MARKET OR BE IN CASH, NOT
DOING ANYTHING, LET IT SETTLE
OUT.
ESSENTIALLY UNWINDING ITS
NEIL: RIGHT.
>> PRESSURE ON PRICES GO DOWN,
YIELDS GO UP.
ON TOP OF THAT PRESSURE ON
BONDS, STOCKS ARE OVERVALUED.
PEOPLE THINK THERE IS INFLATION
IN STOCKS AND EVERYTHING ELSE.
SO AGAIN, BOND PRICES GO DOWN IN
INFLATIONARY ENVIRONMENT, YIELDS
GO UP.
SO BOTH PLACES IT IS HARD TO PUT
YOUR MONEY IN.
STOCKS, WE'RE CLEARLY IN A
CORRECTION.
WE'RE HEADING --
WOULD 3% BE THE INFLECTION
POINT, YOU KNOW WHAT?
I WOULD RATHER GET 3% GUARANTEED
BY UNCLE SAM --
>> ON 10 YEARS BOND.
NEIL: THAN GOD KNOWS WHAT IN
NEIL: THAT'S WHAT I'M SAYING.
YOU AND I CAN REMEMBER RATES ARE
A LOT HIGHER, BUT A LOT OF YOUNG
YOUNG -- FOLKS IT WAS SOMETHING
ALL TOGETHER.
>> MAYBE INFLATION FEARS ARE
OVERDONE.
WE DON'T KNOW.
THIS IS SORTING OUT OF THE
MAYBE, THE GROWTH FEARS, A LOT
OF PEOPLE THINK CORPORATE TAX
CUT WILL NOT SPUR THAT MUCH
WILL HURT GROWTH.
MAYBE HE DOESN'T BECOME
PROTECTIONIST.
MAYBE TRILLION DOLLARS OF FISCAL
WILL GET BOTH LOW INFLATION,
KEEP INFLATION SORT OF LOW AND
GET CORPORATE PROFITS RISING.
THAT IS A GREAT TIME --
NEIL: THAT IS PREVAILING VIEW,
NO LESS THE UNITED NATIONS, NO
FRIEND OF DONALD TRUMP,
COME BACK HERE.
IT WILL STIMULATE THE U.S.
ECONOMY.
IT WILL LATE THE WORLD.
THE IMF SAID MUCH THE SAME WHEN
PRESIDENT WAS IN DAVOS.
OTHER COMPANIES LIKE JAMIE DIMON
LOVE THEM.
>> LOVE RICH FAT CATS.
NEIL: OF COURSE.
DO YOU SEE THAT THE CASE?
THAT IS MORE LONGER TERM BULLISH
I BELIEVE THAT TAX CUTS DO WORK,
OKAY?
NEIL: RIGHT.
>> SO, YES, THAT IS THE CASE.
BUT IF YOU HAD AUSTAN GOOLSBEE
ON THE SHOW, FORMER OBAMA
ECONOMIST, GOOD GUY, VERY SMART
GUY, HE WOULD SAY THIS.
THIS IS THE BEAR SCENARIO.
WE SEE DEFICITS WIDENING OUT.
THAT IS ALWAYS BAD FOR INFLATION
AND IT IS BAD FOR THE ECONOMY.
SO WE SEE RISING INFLATION, WE
SEE POTENTIALLY A BIGGER DEFICIT
AND WE DON'T SEE THAT MUCH
THAT IS A SELL SIGNAL FOR THE
STOCK MARKET.
I'M NOT SAYING AS DESCRIBE TO
THAT HE TOOK THE CORPORATE TAX
NEIL: THE MARKET WAS SOARING ON
REGULATORY RELIEF.
>> ON TOP OF THAT YOU HAVE
MASSIVE REGULATORY RELIEF.
NEIL: WHAT DO YOU MAKE OF THE
TUG-OF-WAR TODAY?
WE HAVE BEEN ALL OVER THE MAP
TODAY.
NOW DOWN 236.
SO IN THESE TYPE OF FAST MARKET
CONDITIONS I READ INTO THAT A
MARKET WEIGHING WE GET IN WE GET
OUT.
>> WE DON'T KNOW.
NEIL: I THINK PEOPLE MISS THAT
YOU AND I COVERED THESE MARKETS
FOR MANY, MANY YEARS.
I THINK THAT IS THE ONE THING
THAT YOU HAVE TO AT LEAST BE
ABLE TO READILY ADMIT.
MARKETS DON'T KNOW IMMEDIATELY
BUT GET A GUT IN TIME.
>> WHAT THEY ARE IMPERFECT IN
THE SHORT RUN AND RUN MORE POUR
TECH LONG TERM.
WHAT IS LONG TERM?
AT SOME POINT THE MARKET FIGURES
OUT WHAT IS GOING ON, INPUT ALL
THE DATA AND COME OUT WITH
PEOPLE WHAT TO DO.
MY POINT IS, IN A SORTING OUT
SITUATION, AND YOU'RE NOT A
TRADER, THIS IS -- IF YOU WANT
TO TRADE STOCKS THIS IS GREAT
TIME.
NEIL: WOULD WE BE HAPPY IF WE
CLOSE, WE'RE LOOKING 5%
CORRECTION FROM THE HIGHS WHICH
THIS MARKET HASN'T SEEN IN
YEARS, RIGHT?
>> YEAH.
NEIL: WE SEE THAT END OF THE
DAY, SOME WOULD SAY THAT IS
HEALTHY DEVELOPMENT.
>> I DON'T HAVE A PROBLEM WITH
IT.
BECAUSE WE'RE OFF MASSIVE HIGHS.
NOT ONLY THAT THE MARKET IS
DIGESTING THE NEWS.
WE DON'T KNOW HOW THIS IS ALL --
NEIL: I KNOW YOU DON'T DEAL WITH
PEOPLE WHO ARE WORTH LESS THAN
DOLLAR-COST-AVERAGE, PUT THE
SAME AMOUNT IN THE MARKET EVERY
TERM THE TREND TO TAKE?
>> YEAH.
I WOULDN'T RIGHT NOW BE PUTTING
MY MONEY, FRESH CASH IN THIS
UNTIL WE FIGURE OUT --
NEIL: REALLY?
NEIL: BUY MORE SHARES OF STOCKS.
>> THIS IS A RANDOM WALK DOWN
AT SOME POINT, SOMETHING WILL
DEVELOP.
I HAPPEN TO THINK IT IS GOING TO