Our economy is badly weakened. A consequence of greed and
irresponsibility on the part of some. But also our collective failure to make hard choices.
These speeches are usually very thematic and broad-based. They're not
policy documents. That's for the State of the Union or the budget. I'd like to see
President Obama really strike an optimistic and bullish tone about the
future of America despite our difficulties. You know, I went
back and I reread Reagan's speech in 1981 with a very sharp economic downturn.
We were at war. The Soviet Union was making itself felt everywhere and of
course you can go back to FDR in the 1930s. Barack Obama has been somewhat
bearish. Really putting the dark side on the economy in his recent speeches
running up to the inaugural. I hope he leaves us with a positive, optimistic,
bullish vision of America's future. Hey Carl, you know, we're looking at a market
right now that's down 150 points. I mean, everyone wants to be hopeful. They want
to be positive and certainly we're looking at millions of people there that
are very positive and hopeful. But the market still remains skeptical. I mean,
the job really begins tomorrow. Frankly, I hope he doesn't stay out too late
tonight because people are gonna be expecting a lot first thing in the
morning tomorrow. Jimmy, how much is gonna how much is gonna flow from the words
we're gonna hear today? Listen, this is it this is gonna set the tone. I think Larry
was right. He needs to set an optimistic confident tone. But listen, he goes into
this I think with a nice head start. I mean, you've been out there. You've seen
those people. This president is gonna start with an enormous reservoir of goodwill and he may need every
ounce of it cause he's gonna be the bearer of bad news for the next six months.
So, we'll get off to a fast start today. I'm sure of it. So Greg Valliere, how do you rate the
President-elect on what Larry Kudlow was talking about that is his ability to
inspire optimism so far? Oh, I think he hasn't I think he will. But I would
disagree with Larry to this extent. I think he needs to lower expectations.
People think this is the Messiah. It's not. That's true. It's going to take until
July to get some of these infrastructure jobs working. It could be second half
before we see pause growth. So he's got to manage expectations.
I mean, it does make you wonder how much time you know the public
is really gonna give him. And they do expect something right out of the gate.
At the same time, they obviously feel feel more positively about him than they
have about anyone else in a long time. But Steve, I mean, it's gonna take a while
to see any results no matter what. I'm not sure Melissa that the public really
matters that much in this case. I think he needs to talk and I don't think this
is the speech to do it. But he needs to kind of convince business and Wall
Street of the idea that his plans are going to work. This is really very
interesting. On the one hand, you've never had an incoming administration as
involved in existing policy from day on as this administration is. But, the
downside of that is the actual difference is, take the stimulus put it
to the side, the actual difference is what's being done for the banking system,
are not going to be that huge. What's prescribed here, (from Bush), from Bush
the limitations here, (the continuation), of what can and should be done, we know and we reported
earlier today. That they're working intensely and talking intensely about
this aggregator Bank idea. We also know they're still hung up on the same thing
that hung them up before, which is the effect on the bank balance sheets of buying
these assets. That reality hasn't changed. Yes, there's going to be a powerful
impact on the American public psyche. I am more interested in the
impact on business. Alright, you're not gonna get much from us from this. Not from this speech.
I'd like to ask Larry and Steve. We just saw Peter Orszag, who's
going to have his hands on the stimulus spigot, as the budget director. How
quickly to each of you expect to see results, if in fact that stimulus package
passes in the next few weeks? I think we could break it up into a couple things. I
think there are some things gonna be out there right away. I think tax cuts will
happen. I think they're 40% of the package.
I think that'll impact, at least balance each, if not spending relatively quickly.
The government stuff is six months-eight months down the road. You know, I think
we're gonna be surprised John. I still think the economy is going to recover by
mid-year. It may recover in spite of the stimulus
package rather than because of it. So, we will have to wait and see. I agree with Larry.
We will recover by mid-year but the big risk on the stimulus is doing too little
not doing too much. As we've been talking, our special coverage of the
inauguration of Barack continues after a short break.
45 minutes to go before Barack Obama comes to the office and we have no rally
at all and it's very simple what the problem is. There is no stability in the
financial system. In the banking area. You can't move things forward unless you get
some kind of stability. Therefore, the Street now thinks that the
bad Bank idea is inevitable. That they're going to have to be buying bad assets.
That the idea behind the original TARP 1 was the right way to go and isolate
those assets. By the way, take a look at the bond market. Where, while we're off
the highs, the bond market is not signaling good news for the stock market.
There will be a point here where we will take a break from watching the markets
and allow the majesty of the moment to take over. But I wonder how long you
think that phenomenon will last if it'll even last the day. Well don't ask my
opinion. I think it ended an hour ago, Carl. I think that it doesn't make- it's
good to get in with the pageantry. But but you you worry about the extent to
which this is being built up. And whether or not, you know, we talked about
it this morning, Carl. The extent to which the people who are- have their hopes and
dreams invested with the new incoming president, have any sense of the kind of
very, very difficult financial choices that have to be made on things like the
TARPS, the capital of the banking system, the stimulus program.
Ladies and Gentleman, the President-elect of the United States Barack H. Obama.
(Cheer)
(Music)
Our economy is badly weakened. A consequence of greed and
irresponsibility on the part of some. But also our collective failure to make hard
choices and prepare the nation for a new age. Homes have been lost. Jobs shed.
Businesses shuttered. Our health care is too costly. Our schools fail too many. And
each day brings further evidence that the ways we use energy strengthen our
adversaries and threaten our planet. These are the indicators of crisis.
Subject to data and statistics. Less measurable but no less profound is a
sapping of confidence across our land. A nagging fear that America's decline is
inevitable. That the next generation must lower its sights. Today, I say to you that
the challenges we face are real. They are serious and they are many.
They will not be met easily or in a short span of time. But know this America, they will be met.