estimates of wall street traders. aagree. capitalist wall street has given us better than expected results. even with a slight rise in revenues, they will come heavy as economic recovery takes hold. a big profit push that will give stocks a lot more value and means the bull market continues well into next year in my judgment. it will get back to 1,000, go to 1100, and go to 1200 in the s&p. that is pre-lehman, that's what i want you to think about. that's why i'm more than happy with these market pullbacks and corrections that may or may not come. first-up this evening, speaking of the new bull market, today's slight pullback was healthy. let's go to cnbc's matt. hello, matt. >> interesting day, we had three economic data points before we even got rolling and investors chose to ignore the real surprise, an increase in factory orders and focus again on the

preliminary jobs data, the adp, which has now taken on more and more respect ahead of the big one coming out friday. the adp an services data coming out weaker than expected and snapped the momentum in terms of improving economic story. look at the big picture, dow and s&p snap ag four-day rally, both down a half a percent on the nasdaq and the worst of the three, a .9 decline and the big product consumers maker coming out with revenues that had people concerned, the problem is their products are premium priced and therefore their sales are feeling the pinch, p & g. and one of many energy stocks, interesting noting here, they missed by five cents but said their north american business has seen the bottom. the same cannot be said for the

international side but baker hughes giving up almost 80% on the session. garmin and whole foods and foster wheeler all in digits after posting strong earnings. other notables, i probably should have led with this. financials up for the fifth day, the nine month high, the second heaviest weighting in the s&p 500 sectors. they leaved frog from fifth place to second place and only behind tech stocks. financial's giant move there today and firing on all four cylinders. the financial sector made up of four key industries, all advancing today, talking about  insurers led by aig and banks led by anybody but pnc percentage-wise. apartment investors, very strong, 8% high e citigroup, my worth, 10% move with a one day volume record, 347 million

shares of citigroup changed hands today. quite a thing it was. tomorrow, more earnings coming out. weekly jobless claims, retail sales expected down 5%. comcast, directtv, black stone, cnbc all reporting, and don't ignore these if you're following the global story, unilever, they're all over the diabetes stories and thompson reuters, a big canadian company worth watching. >> i love banks. that has been my mantra. i'm glad the banks are still around, a great economic recovery sign. you mentioned citigroup, a government owned bank. citigroup did great today, fannie mae did great, freddie mac did great, the welfare recipients in the banking world. you own them as a taxpayer, you own them.

why are they rallying and in particular, fannie, freddie and aig, you want to talk cash for clunk steres, this is clunkster city. >> they're the hottest group. >> freddie, fannie, aig? >> in the short term. the financials have the big mo as george bush used to say. >> government welfare banks. >> people are buying them. badly beaten. some is short-covering, aig, five or six different specklatory reasons why that stock moved here today ahead of earnings friday. the truth of the matter, a long way to go to get back. the best short term but they still are the worst on a aany -- >> jpmorgan closed above, pre-lehman high last september. thank you, matt. we appreciate it. we will come back to the

bank story. i think it's really important to the stock market and economic recovery. but first we must swing over to tech land. cisco beat the street. the silicon valley bureau chief straight from the west coast, jim joins us, one of the world's greatest businessmen, what's going on? >> see if you like this report. good evening to you, good but not good enough, stable but not solid. does the cisco dip spotlight opportunity for investors, 31 cents a share against 29 expected with inline revenue of $8.4 billion and offered better than expected guidance anticipating a 15 to 17% dropoff in first quarter revenue. that might be bad but a point better than some on the street were looking for. despite the less than optimistic tone on the conference call,

they're not calling a bottom. a trend suggests a bottom and have to go several quarters to be sure. they said this was the first normal season am sequential performance the company has seen in four quarters time. gross margin reached 65%. the $35 billion in cash the company has on its balance sheet is more than google and intel's cash combined. investors who drove things higher last quarter are heading for the exits later tonight wanting a clearer and more certain outlook. i'm reading through the lines and sounds like the makings of a rebound to me but not just yesterday. >> what did you hear on the conference call? there's some sort of panel interview going on as we talk. is there anything new coming out, jim. >> the call was extremely optimistic. margins dipping 54% the first fiscal quarter, what it should have been during the fourth fiscal quarter, seeing

stabilizing margins. saying this company is world class to maintaining the margins and see the spending to expand and what he sees now is very good, just wants to see it continue a few more quarters. he was hartened by the good news during the quarter? the tipping for the economy occurred in the quarter just ended. do you buy that? i don't know. there seems to be a little credibility as the stock trades down. my personal view, john chambers one of the world's greatest businessmen, if he says that's the tipping point, why don't people believe him? >> i don't think it's a question of people believing him or not. he qualified what he said and said it appeared the tipping point occurred in the fourth quarter but didn't really say that. >> i hate to cut you off. asia china links to cisco? >> asia china looking good for

cisco, the company said those regions of the world basically performing as planned seeing the seeds of recovery today. european is a problem, two quarters late in the recession, those companies are essentially two quarters behind. >> i think anybody doing big business with asia and china is absolutely the key. j jimmy goldman, thank you very much f. you hear anything new, just yell, get you back in. to my speed trade segment. brian institustutland and scott nations, station thats shares chief investment office and options actions trade investor also. options actions, this is good stuff. i want to talk bank, zero interest rate, steep upward curve, even a banker can make

money and lots of money after that and can even grow out of their toxic assets, what do you think of that. >> i think you're absolutely right. don't find a bank you kcan buy, buy a bank you love. >> buy any bank. it's gone public, that has the point i'm making, it doesn't matter, this is an economic led driven recovery. >> the banks you mentioned are bottom of the barrel, city bank, bank of america and aig. the reason they're getting a pop is because people put so much money in the good ones they have to cast their net. i couldn't don't want to buy those on the shelves while people pass all the good banks. >> what's your favorite bank. >> jpmorgan chase, best commercial -- >> jorripmorgan went through th pre-lehman brothers number. september 12th it was 4$41.17, the whole market will drive past

the lehman brothers thing. >> for jpmorgan, you're right, they're back to a good level. the yield curve works for them as well as anybody. part of what we see from citigroup and smaller bank, it's easy to feel good about bad companies when you're giving away cars. i can't believe you turned -- >> cash for clunkers. >> i don't know if i should call you brutus or benedict arnold. >> if i can possibly remember this, foolish consistency is the h globing of little minds. just on this one issue, on this one issue, we finally found a fiscal stimulus that works and it's good for the consumer spirit. i actually think it's going to work. i will give you a whack at the bank story. i think bank, buy them, buy them, indiscriminate bank buying. >> one thing we saw today, don't look at banks necessarily, look

at some of these that are shoring up the balance sheets and locking in leverage caution them to decline a few months are in play and moving up. a stock like cbl, sl green realty, stocks having huge moves to the upside. i've owned them. had to dabble a little in them. you talk about banks that had troubled assets before, starting to turn around, people lending again and the liquidity of the market is there. >> the fed may not tighten in our lifetime, i say that somewh somewhat tongue-in-cheek. let me ask you why are the welfare banks doing so well, fannie, freddie and aig, these are the worst cases, not even i would say buy them. they've done well, trading up. are there rumors? more government money? swaps? what's happening? pick up anything on that? >> one thing you're seeing, people are trading up, like

scott said, they're grabbing for another area of the bank sector. one thing most important it's not like they were telling a bad product before, they were in the business of lending to america, helping america grow whether home lending, business lending, what not, the cash on their balance sheets have been short up via the government, via the taxpayer. that has helped them to succeed and think you see them to continue to improve and mover higher and it moves on that type of news. >> scott nation get ready, i will show you a hard fast breaking slider pitch here. news head line, fed set to end purchases of bonds. no more bond buys according to two former fed garciaparovernor. they should know. if the fed ceases and desists buying more treasuries that means it will continue to level out as the balance sheet has the last several months. does that mean the u.s. will grow stronger and what does that

mean for commodities and energies? energies was hot today, copper was hot today. if the fed quits buying futures, what does that mean to you? it's the first step toward the fed raising rates, they will end quantitative easing, essentially a cut. what does it mean for the dollar? probably a slightly good thing for the dollar. any real interest earned will be overwhelmed by loss through inflation. >> inflation, did you say inflation? you think there's inflation coming? >> inflation. >> inflation, you must have looked hard top drawer in the desk. >> and crude oil is at its high. >> scott nations, when does the s&p 500 which stayed above 1,000 today, when does it get to 1050? that's the question tonight, 1050 on the s&p. scott, you first. >> maybe by the end of the year. >> end of the year, brichb, you

second. s&p probably on the way to 1150. >> i think it's around the corner. the options the last few days, people playing short term, august, i think we see the next couple of weeks, we could move higher and go from there. >> brian, you just make me feel so good when you talk like that. it's unbelievable. >> get a new car. >> it's unbelievable. >> i'll take it. >> scott nation, i wish you all the luck in the world on that inflation hunt. thanks for coming out on the program. a quick reminder, more on brian and scott this friday at 11:30 p.m. right here, cnbc. coming up on "the kudlow report," two famed investors, not one but two. ken langone, former head of the stock exchange and home depot and this guy, so famous in his own right, he sees a 10 to 15 year bull run. how about that? is cash for clunk ires bullish? heck, i think so.

we will have a rip roaring debate about it. i may be the only conservative on the planet and still think it's good for consumer spirits and help the economy a bit. did i finally find a federal program i like? keep it right here. we're "the kudlow report." we're straight ahead. at 155 miles per hour, andy roddick has the fastest serve in the history of professional tennis. so i've come to this court to challenge his speed. ...on the internet. i'll be using the 3g at&t laptopconnect card. he won't so i can book travel plans faster, check my account balances faster. all on the go. i'm bill kurtis and i'm faster than andy roddick. (announcer) "switch to the nations fastest 3g network"

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the new bull market. that is still the same. the question is what do do with your money if anything. former home depot ceo, ken langone. you're terrific, standing up at the chalkboard and nell hennessey, portfolio manager at hennessey funds. good to see you, buddy. let me start with chalkboard stuff. we came in a little light today on some stats. i wouldn't get too excited about it. this is the itm non-manufacturing index, call it the services index. it came down here a little bit. people thought maybe it would be a little stronger, it was running up in the 46 area,

people were hoping it would break 48. all i say is the trimline is still unmistakebling. you're still running a good trimline. the second number that came out a little light, adp private employment survey. it is what it is, doesn't correlate perfectly with the payrolls that will come out friday. it is a private payroll survey and came in a little bit light. people were looking for something a little stronger, that is easier, less jobless. you know what, it's still the lowest job loss number in nine months, i think it came in around 370 and people looking for minus 350, still the lowest in nine months. that sets the stage a little bit. we'll come back to other stuff in a second. ken langone, are we in a recovery, headed for a recovery? >> eventually. >> in my lifetime? >> i think so. >> soon? >> soon? >> where do you come out on

this. >> i'd like to see us have a slow and constructive recovery. i think right now, there's an also lot of hype. >> hype? guys like me. >> not so much -- >> i'm just reading the numbers. >> don't be so defensive. >> what about the stock market rally? >> the stock market will do what the stock market wants to do. i have to look at stocks as representation of earnings and different sen dividends and underlying economy. where are we? we just came out of a head-on collision, have lot of recover troy, do balance sheets need to be restored, particularly violence, have an enormous amount of debt out there. don't know the depth of the problem with credit cards. we do know people are frightened. the savings rate, to me, is a reflection of people saying, i ducked the bullet, i want to make sure i live longer. i think that's healthy.

i'll say this. if we in the private sector engaged in promotion the way government people are today, the sec would billion all over us like a ton of bricks. >> you're not happy with government? >> i'm never happy with too much government involved. we need government, we need laws. >> do we have too much government right now? too much regulation taxes, spending, the whole nine yards. >> oh oh, oh -- >> supply-side. >> i'm not buying the whole package. >> neil, get ready. think we have too much government involvement in promote ag recovery. we have a bad housing industry, we have a bad automobile industry. we have high unemployment. i'm intrigued to hear people like yourself say, well, the increase has gotten less. eventually, it gets down to zer zero. >> the job losses, the job losses which were horrible are getting easier, getting easier, they're not over yet. the estimate for friday is about

350,000. >> for the moment. everybody concedes we will reach 10% unemployment which means that's got to go down. >> means we got to get it back up to here is what we need to do. let me bring in neil. you heard the great ken langone. ken mentioned profits, a lot of this for summer is earnings per share, doesn't mean everybody is making money, means they're doing better than all the doubt ers thought. and i want to shout out stefan abrams for soaring profits. you heard ken langone, what's your best guest. >> the recovery started last november. we put $350 billion in the banks. did we put it as a loan for the congress wanted on tv and hyped the banks not loaning? no, they put it in there to stabilize, doesn't mean you're

breaking a wrist, you put a cast on it to heal and then the recovery starts. this is no different than the past. look at 2002, are you the ceo sitting in the corner off fishings your stock is down 60, 70%, why not let go of some of your employees and why not let your inventory deplete itself? why not get lean and mean. >> is it possible on this cost cutting point, real market capital lipse, businesses are still doing it, cutting inventory and cutting jobs and hours worked. the question for, you i will ask you the same thing with respect to home depot and other firms you're intimately famp with. neil, you're first, did they overcut on jobs? did they cut too many people in the credit panic of last fall and might that mean the employment story in the next few months will be better than people think. >> i've been saying for a while, you will see hiring starting the third, fourth and for sure,

first quarter. as inventories come down, somebody at some point in time is going to place an order. they're not going to wait nine months for that order and whoever is going manufacturer it will start to hire. the person that hires can see the independent of the tunnel with light there. the people sitting in the chair already employed gives them confidence they will keep their jobs and might open the purse strings the same way it did in 2006. ken langone, home depot you're in touch with and other firms. did they fire too many people? is it possible? >> you don't know until it's too late. the fact of the matter is the numbers we're seeing now are principally a reflection of cost cutting not revenue growth. >> isn't cost cutting a precursor of the revenue boom? always happens in the earnings cycle. >> neil talked about 2002. 2002 we didn't have unemployment approaching 10%. we didn't have housing industry

devastated, we didn't have an automobile industry where general motors and chrysler have gone into bankruptcy and people are jumping up and down because ford had 2.34% growth in sales. this is the worst we've seen in 50 or 60 years. >> you think it will take that much longer to heal? >> i think it should take longer. i hope we do take longer and have a healthier and sustainable recovery. >> the laugh plans are way down from where they -- the layoff plans are way down where they were earlier this year. neil, your favorite investment. >> it has to be low end consumer discretionary spending. >> low end. what about my bank play, neil? >> the banks are on their way to recovery and has been and why you're seeing t.a.r.p. money being paid back. loans going out.

it takes a while to get a loan but you can get the money, you have to be patient. >> would you be 100% vested? >> i'm fully invested. >> oh, you're hiding that fact. >> i want the market to go up on a sustainable basis. i think what's going on right now, we're pouring money any which way we can. this cash for clunkers is a manipulation! >> you don't think it's a good idea to sell a few cars, jobs? >> those people -- >> tax revenue. >> those people that are going to buy them either have good credit for have money in the bank to pay for the rest of the car, makes it cheaper, they would buy them anyway. >> i hate government. this is one that works. give me your favorite area. >> health care. >> health care. >> certain retail stocks. >> you guys agree on retail stocks. let me come back. we'll ask later in the show

exactly what ken goes to, is cash for clunkers bullish? i continue to believe it is. i don't want to launch a new orgy of nymphomania. this is the one plan that hits the spot, the national attention getter and i think they're buying cars and might help create jobs. first, $100 million men. why is quarterback eli manning any better than goldman sachs or citigroup energy traders? now, that's a tough question. our guests are going do weigh in. i may have something to say. i'm a little tired of attacking people who get paid for performance in the financial sector. please keep it right here, the "kudlow report," the new bull market.

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a little bit offbeat. let's talk about $100 million deals. goldman sachs said it made $100 million in revenues in each of 46 separate days. now, it's the target of a government probe. citigroup energy trader andrew hall is under scrutiny from the white house pay czar for a potential $100 million pay day. and new york giants quarterback eli manning just signed a $100 million contract. an i want to ask, a, what's wrong with making money and ask, b, go to will hennessey and ken langone. let's start with you. i am a new york giants fan.

i'm more than happy to see eli manning get a $100 million contract. i hope he's worth it. he finished very badly last year. high i hope he has a better year this year. at the same time, why are we lauding and celebrating, as everyone did today, the signing of this contract, where as everyone is yelling and vilifying andrew hall, who made 100 million bucks trading energy and goldman sachs, which is making money hand over first and announced today in one of their filings, 46 million separate days they made $100 million in revenues. why is goldman bad? why is andrew hall bad and why is eli manning good? i don't understand that. can you help me? >> i can't believe you don't understand it. this gainesvilles services company, this is a guy in the financial services industry. >> right. >> these are the guys in the industries that made the mess and created the crisis in this country. >> i thought we wanted to get out of this. . >> stop. stop. you're asking me about why there's traction here and this guy gets a pass.

>> this guy made a mess of the playoffs. >> doesn't matter. we don't own him. the fact is the financial services industry are the bad guys and they're going to be the bad guys for some time. >> neil hennessey, do we have to keep vilifying these financial services, i thought we wanted financial services, neil, to recover. i thought if you get paid on a performance basis as for example mr. hall has from citigroup fibro, the energy company, he got paid on performance basis, why are we vilifying him? in a sense, i neglected to mention the oprah factor, let's not forget oprah winfrey has a $275 million contract. i say, fine, fine oprah. i say fine, eli manning, fine to anybody who earns the wealth, the market rewards them, i want everyone to get rich and wealthy. why are we still vilifying goldman sachs and andrew hall,

neil hennessey. >> the new economy to them is you print money, don't earn it. that seems to be the problem. go back to last fall, the congress was all over oil companies because speculators ran it to $147 a barrel. same thing happening today. this gittesing crazetting crazy. you would think they would be happy the banks are getting solid footing and making loans. if you don't make money, you can't make loans. i don't see the problem except they're getting ready for 2010 election this is wrong because we're trying to steer the future new york times city america for the next election. >> i want to repeat i am happy ely is getting a great contract and happy oprah has done great a fabulous fabulous story. >> so aim. >> if we want the financial sector, banks to recover, why is

it wrong for goldman sakz and mr. hall, when do we stop trashing these guys. >> did somebody make a deal with mr. hall if he delivered others -- >> apparently. >> a deal's a deal. he delivered, they owe him the money. goldman sachs is a for profit company, not a charity, not a business government unit. these people are smart, understand markets, the proof of how smart they are, look how they came through relatively unscathed last year when lehman went and merrill went, down the list of all the companies that blew up. >> you're not afraid of 100 million bucks. >> i'm not a45ed anything that's earne earned. >> right. that's the key point. in your opinion, did goldman person? >> of course. if goldman didn't earn it, their auditor better find out. >> fair enough. they made this public, showing the shareholders and government and showing everybody. >> they're a public company. >> right. they're abiding by the law. >> this one, i gather made a

couple billion for his boss. >> ought to be grateful. >> if he makes $2 billion for me, i'll give him 100 million too. >> before we lose you, you talked about small end retail s retailers, you're very bullish for a long run. more investment advice. >> the area i'm not keen on is technology, like ciscos, hewlett-packard, ibm because i don't see anything in technology that will change the way we live and work, larry, like the computer did in the early '80s and internet. >> how about industrials? real quick. >> i think the industrials will start to do well. as the economy picks up, industrials pick up. >> recovery trade, are you looking for recovery trade? >> i don't look for recovery trades on anything, i look for good investments and buying for the long term. >> you are sticking 10 to 15 bull market. >> yes. >> heck of aca. i hope you're right. i can't quite get there myself

but heck of a call. >> ken langone, one year bull market. >> from now? >> up or down? >> no. i think the market has to rest for a while. >> ken langone and neil hennessey. coming up, the cash for clunkers debate that captured the public's imagination, less ken langone, he doesn't like it. please stay right here, we are "the kudlow report," get paid for performance, 100 million bucks, if you earn it, i don't care who you are, you earned it. welcome to the now network. right now five co-workers are working from the road using a mifi, a mobile hotspot that provides up to five shared wifi connections. two are downloading the final final revised final presentation. - one just got an e-mail. - what?! - huh? - it's being revised again.

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♪ love stinks! president obama put the hard sell on the economic recovery going out to the midwest and talked about cash for clunkers and does it threaten to run dry by the weekend? i don't know about that. our washington correspondent john harwood will explain. are we clunking along. >> we're clunking along. president obama is right to sell that health plan and has to assure americans he's right on the economy and it's turning around, especially with the bad job numbers on friday. he went to indiana, a state he

won last year and announced $2 million for funding for electric cars and said his policy on stimulus, we're laying the foundation for long term growth. >> i don't want to just reduce our dependence on foreign oil and then end up being dependent on their foreign innovations. i don't want to have to import a hybrid car, i want to build a hybrid car here. i don't want to import a hybrid truck, i want to build a hybrid truck here. i don't want to have to import a windmill from some place else, i want to build a windmill in indiana. >> you can see that message went over well in indiana but the president still has work to do in getting the senate to go along with the cash for clunkers program. i talked to a senate leadership aide tonight said the republicans continue to put up roadblocks to that plan although they do expect it will get done by the end of the week and tomorrow, larry, the president has all six members of the so-called gang of six negotiators on the senate

finance committee down to the white house to talk about health care. >> john harwood could you pass a message to president obama and tell him kudlow is helping him on cash for clunkers, i wrote a column. >> the white house has noticed that, larry. >> i have come to believe of all those federal things out there, this one might actually work at least for a while. help me, john, help me on this, i need some credit. >> i'll make sure they know and bet they appreciate it. >> thanks. coming up, is cash for clunkers just the right fiscal stimulus for our economy and the new bull market? we will have a wee bit of debate. first, let's check in with my pal, dennis kneale all over this story. newscorp, when cat yn you tell about newscorp. murdoch wants to charge for all his websites, is it brilliant for desperate? will it change the websites?

i don't think so. google would have to start charging to change the rest of the world. >> i don't see it. dennis kneale at "the kudlow report." we'll be right back. cash for clunkers, we will debate. i actually come out in favor of some fiscal tim lus. (announcer) this is nine generations of the world's most revered luxury sedan. this is a history of over 50,000 crash-tested cars... this is the world record for longevity and endurance. and one of the most technologically advanced automobiles on the planet. this is the 9th generation e-class. this is mercedes-benz. and i am the chief shoe giver at toms shoes.

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still believe the cash for clunkers program is great for the bull market and why i'm supporting it as i have the last two evenings. you can look online for my column, may be the only conservative in the country. not everyone agrees. jo john, and wall street journalist steve moore, co-author of "the end of prosperity." won't the cash for clunkers, steve, end the cash fend of prosperity. >> i have to take away your writing. >> and he knows this stuff. i'm just a hack. >> you guys are for clunker economics. let me just say for full disclosure here, my wife and i are going to take advantage of this program. >> here you go. >> we have a car worth $600, the government will pay us $4,000.

it's terrible economics, larry, this is basically violating the economics. henry has let, you have to go back and read it. you don't create wealth by -- the government owns the car company and basically paying americans to buy the cars. >> john, i don't want to let this slip by. if steve moore and his beautiful bride, alison are out there buying it, participating in cash for clunkers, john, isn't that the ultimate incentive test, i ask you? >> i think it is. i'm tempted as well. let's face it we have scrappage rate in this country $12 million, selling less than 10 million cars and trucks. now is a really good time if you can get people to overcome economic fears. the unemployment rate is so high. giving people 4 $1/2,000 to go out and buy a car. i think a 17% flat tax would be the greatest stimulus, but not politically real, this is getting people out buying cars,

right now the economy trying to pull out of recession, it's one of the few government stimulus plans actually working. >> steve, take it from john's economic rift. consumers love this. americans have a love affair with cars, you're giving them a reason to talk cars, go in the showroom. it will lift their spirit, been a terrible two years, you know, steve, going into the showrooms, if they don't buy a new car, they're buy ag used car, that's how effective it is. >> americans have a love affair with cars and what americans love is free money. it's basically free money. that's why i'm taking advantage of it. you and john are violating what they taught us there, ain't no such thing as free lunch. if the government is going give somebody $4,000 to somebody to buy a car, that $4,000 has to come from someone. >> i agree there's no such thing as a free lunch.

every now and then you get a free sandwich once in a while and john is saying the timing is good. we'll come back. john, steve moore, i'm kudlow, the cou"kudlow report." cash for clunkers! hi, may i help you? we're shopping for car insurance, and our friends said we should start here. good friends -- we compare our progressive direct rates, apples to apples, against other top companies, to help you get the best price. how do you do that? with a touch of this button. can i try that?

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here's my national review online column posted a little before the show, we will put

that up on the full screen. there it is, a vote for the clunkers, i think i'm the only movement conservative. i'm amazed they posted the piece. i thanked the editor, been contributing there many years. secondly, look at the ford motor company stock. their stock has had a nice run as a consequence at least in part. check that out. a heck of a run. five bucks to 8 $1/2. that has something to do with it. third, we must bring back steve moore's old car he's cashing in on even though he hates the program. in 1998, isuzu rodeo. i don't know i've seen a car like that. you say intellect rally he's gotten rid of this clunker with the help of uncle sam? isn't that the route a lot of americans might go? this shows the power of practice over theory. >> that's dead right, car sales

and truck sales, mostly car up 15.8% in july. that program was only working one week and august should see a lift the lowest inventories since 2002. opposed to clearing the lot, it will increase production and actually generate wage income and maybe even some profits and the government will get tax revenues back. it may not be a free lunch but a relatively cheap lunch in my opinion compared to all the other goofy stimulus ideas. >> i will grant you that point, out of all the other stimulus plans we have come out with the $800 billion, i would agree, this is the most effective. i talked to a democrat senator today said he's been in the united states senate 25 years, this is the most effective federal program and most popular program he's ever seen. >> i true lie believe this, it has captured the public

imagination, my point about consumer spirit. i think it's an important point. it's been a terrible two years. >> let me make two points. one is a practical point, you talk about the used car market, they will basically scrap these cars. there won't be a used car market because of this. second, the point john was making, he's right a lot of us who had clunkers are speeding up the transition from the old clunker to buy ag new car, john, the problem is what will happen in three months when this program is over, like sending out the stimulus checks, later the economy falls to where it was. i guarantee you we will not see very high car sales when this program is over. >> i don't necessarily disagree with that. we're accelerating sales right at the time the economy is trying to pull out of recession. i think you can see 3 1/2, 4% gdp growth in the third quarter partly helped by this and might give us a psychological lift to get spirits going in the right

direction even though auto sales will go back. >> listen to him, steve moore. he's smart. he knows economics. >> i remember those days when john and larry kudlow were free market. >> we're just having a -- >> now you sound like used car salesmen. >> lord, i love it! that has to be the last word. john, thank you, buddy. steve, you're terrific. what is that an isuzu rodeo. my god. catch me tomorrow morning on "the call" with melissa and trish at 11:00. fithe same tools the pros use, so you can be a disciplined trader. by selecting from eight advanced triggers,

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whatever you think about the cash for clunkers program, yes, i do favor it. i want to make this point about the stock market bull market, the bank story is not a clunker, just look at the c curve and zero percent interest rate. banks have been outperforming like crazy. bank leadership will drive the market higher. bank leadership is important for this whole economic recovery

story. banks are no clunker. buy them, dennis, because i think it spells bull market recovery. have a great show tonight. >> thanks, larry. "cnbc reports" starts now! tonight on "cnbc reports," health care showdown as we cruise closer to a bill, the anger gets stronger. >> what about people get denied coverage because they have canser? >> figure it out. >> figure it knockout. >> tonight, senator ron white one of the biggest backers of the health plan is here and dennis gets his turn to go one-on-one. >> it can be easy to lose hope especially when you see a lot of folks who failed to meet their responsibility. >> a new shot from the white house against the bow of big business. is the president going too far. >> and russians tracked off the east coast. why now? is a new cold war coming your way? want the real deal with

dennis kneale? don't move. cnbc report starts right now. >> good evening, i'm dennis kneale. we start with breaking news. we have startling news from rupert murdoch who says they will start charging access for all their websites and will turn everything down on the internet where most entirely everything is free of charge. the let's discuss it, gentlemen. first, porter, is this a brilliant first move he's making or is this desperation? >> i think it's little bit of both but think rupert has shot himself in the foot. unfortunately for everybody that wants free be universal and ubiquitous, rupert does have need to know properties like "wall street journal" and time