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turin on "the kudlow report" mr. market keeps voting for economic and financial recovery as the dow hits 11,000. and ten reasons the v-shaped economic recovery is real. we'll go kudlow one on one. plus thomas hone ig is a new fed superstar, who wants to prevent another financial bubble. how about cowboy monitorism? i'll tell you what that means later on. finally dan mudd is grilled by the financial crisis commission. i have two ideas -- privatize them or privatize them. our dynamic duo will debate. fast been your seat belts. "the kudlow report quest begins right now. .

welcome back. another good week for stocks, as the dow ticked to 11,000 today, though it couldn't quite hang there. but here's a key point. investors are voting for leadership sectors that have strong economic recovery written all over them. financials, consumer retailers, energy, tech, industrials, transports, commodities, now we're going to talk about the reasons for a v-shaped recovery boom just a bit later, but right up front, first this evening i want to focus on the meaning of mr. market's reality, and in a sober spirit, what are the risks to this rally? we've got grease, we've got bond rates, we might have overexuberance, we've got china, we've got future taxes and regulations and whatnot. let's go to our two experts.

done luskin is chief investment officers at trend micro, and michael farr of farr, miller and washington. michael farr, already, it isn't the 11,000 part that interests me. that's just a number. what does interesting me, michael farr, is the leadership this week and today, but this week. we've got your bank, your consumer retailer, techs, industrials, energy and transports. to me that is investors voting with their moan for economic recovery, for financial recovery, probably for a stronger recovery than almost anybody thought possible a month on two ago, and i want to get your take on this, michael. is it sustainable? do you buy it? or are we being lulled into correction city? >> yes, larry. i'm right there with you. >> i gave you seven options. >> and i'm going with all of

them. [ laughter ] >> happy friday. happy friday. >> happy friday, pal. look, when the market is going up like this, you've got to stay out of the way. we are in absolutely see no evil, speak no evil, hear no evil mode right now. there is no bad news that's going to family the market, the momentum is there, and everybody is buying into this v-shaped recovery, and they kind of discount bad news, we discount greece, we discount unemployment. we discount what we don't want to see and what we cling to you higher numbers and bigger advances in our port follow. it might continue, but come on, we haven't had a pullback. >> are we in denial? >> i think we are, and i'm not referring to the egyptian river. are we in denial? >> i think we are. >> i want to look at this soberly, coldly, seriously. i don't want to be overexuberant. i want to know your take. >> i think we're in denial about future risks. i think we're expecting a

goldilocks recovery without blips in the road, and i don't consider that realistic. >> i want you to put some of the salt and pepper. some of this is precious of the chinese yuan, more salt is the grebe pull-up. they're pulling deposits out of the banks, it's dead in the water. more seasoning is view that growing bonds, and interest rates could go up? i'm talking about long-term interest rates. what are you thinking, mr. will you luskin. >> i think we have to get over the binary look where we're either in an expansion or recession. we're always somewhere in between. i don't think there's anything wrong with saying we're where? between, and the wonderful performance of stones, which have brought them back to pretty full, maybe slightly light value

valuations have been in response to what we expected a year ago, the world is not ending. to the see no evil thing, we throw crises, like the euro crisis centered around the sovereign debt of greece, we always have to go through this white knuckles experience, but we know in our heart of hearts that the world is two big to fail, somebody will bail out greece, somebody will bail out portugal, somebody will bail out whoever the next victim is. as long as we believe that those bailouts are going to continue, then the economy will continue to pull back, the end of the world will recede in our memories, and stocks will continue to creep up. that does not mean we are in a sustainable, robust, self-propelled expansion for the kind we're used to for most of our lives. two very different things. >> amen. >> very interesting point. a very distinguished invest

strategist, jeffrey climbtop. >> a good guy. >> yes, he is. he's on the tape saying we are in the beginning of a 5% to 10% correction, because everybody is expecting a fabulous profit season. it's a v-shaped recovery in profits, but he says as they numbers come across, people will sell the fact just as they bought the rumor. i want to put in sonar jo warning, front and center on the day we hit 11,000, in the spirit of a sober evaluation of this stock market. what do you think of his correction scenario? >> i think that the old line that you would buy the rumor and sell the news, the expectations are there for better and better profits if they miss by a little bit, i think that news could easily be sold. certainly we're very overbought here. i like what don just said. i think markets are going higher

and higher based on the expectation of continued bailouts. i don't think that's a really sound investment thesis. let's make sure we're going to invest money for today whatever will be bailed out tomorrow. we need to find this organic expansion that we're sort of used to, but perhaps we have to allow the thing to contract without constantly shoving money into it and bailing it out every time it looks like somebody might lose a nickel. >> i'm not sure of what you just told me. are you bullish or bearish? what did you just say to me? >> i am long term bullish, fully invested, but short term very cautious and my portfolio is allocated in a defensive way. >> don luskin, you are underwhelmed by the greece threat. i want to ask you about the revaluation of the chinese yuan. there's still some issues we

don't know, the "new york times" keith bradscherr is reporting that they'll probably revalue it, and then loosen the band and let it appreciation some more over time. >> and we believe everything we read in "new york times." >> every once in a while they get it right. he was by far the most pinnated reporting in the major media. tim geithner is coming back from beijing, but he ain't talking yet. probably a wise thing. is that bullish or bearish? >> i think it's bullish, because the alternative is armageddon. if they do not do a symbolic revaluation and getting that managed peg to creep up a bit, then we'll have chuck schumer and the rest of the protectionists in congress aided and abetted by our protectionist

in chief, that will result in a war that -- so a little r & b valuation is way better than that. china's economy has the hottest inflation rate of any major economy in the world. the reason why is because they don't have independent monetary policy, but being pegged to the dollar they're pegged to our policy. that may make sense for a 10% unemployment rate, but it does not make sense for a 10% gdp growth rate, which you have in china. the only way to seize bay any independence is to start revalues the yuan. >> i think that's a brilliant point. >> that's a nobel prizewinning point. absolute brilliant point, that they are tied to our zero interest rate policy, which is completely inconsistent with their situation, probably

inconsistent with our economic situation, probably. michael farr, let me come back and ask you about tax policy, okay? then no tax hikes for the remainder of this year, but in 2011, a tax on successful earners, small business owners, and also a tax on investors, via the capital gains tax. here's my question. when does the stock market tart to discount the negative effects of those disincentives, which reduce the present discounted value of future after-tax cash flows of stock? when does the stock market, michael farr, begin to look down the road? i'm thinking the first half the this year, stocks are saying, great, i'm going to pull in, take it all this year, but then i've got to sell it out, because i don't want to pay the higher capital gains tax next year. is that a washington factor that could be a wet blanket over this rally? >> i think no question.

i think it will certainly exacerbate whatever decline that comes, but particularly after the elections, that's a tricky time when the fed could step in and be more aggressive about tightening policy. you combine that with tax rate and a bit of sell-off for people who want to take taxes, could create a little more selling pressure at year end, i think that definitely fakes the market then. no question. >> that could be a 10% correction there, because it's basically a 10% rollback. don, let me ask you the flip side of this. what about the tea party revolution, which is a coalition against spending, a coalition against taxes, and a coalition of government -- against government control, the economy. don, politically, the tea party story gives the republicans the upper hand for tremendous regime. that could be bullish, that could change the future tax hikes, that could change future

obamacare, change the tax on gains, in other words, all that could get change. where are you coming out on that? >> i'm totally with you. why doi you this stocks went to new highs? that put the noose on the democratic party in congress. now with bart stupak gone, they give the republicans a 45% chance of taking over the house. that is cool. by the way, i am long at 22 and proud of it. >> you are long at 22. what does that mean? >> that means i bought the contract when it had only a 22% probability, now it has a 45. bet on a miracle, baby. >> my friend, the political strategist says republicans will pick up 10 seat in the senate and carry both houses, don. without laying down and gen uflecting with the republican party, always a high-risk

venture, nonetheless it would stop the mischief and that's bullish for stocks. is that what you're thinking? >> until ronald reagan is resurrected, all we can hope for is gridlock. it would newter the juggernaut. that's the best we can hope for, and it's going to happen. >> you sound mildly bullish. >> i am. i am. >> michael farr, you're going to play it from the long time? >> i am, but senator bob corker has a different take. he thinks a bit of a close ever match of democrats and republicans, red and blue, in the house and in the senate, that then they can force each other to build consensus. you get better policy out of a closer race, and perhaps that would be a real benefit from the republicans upping their seats in november. >> you know, michael, as an admirer of senator bob corker and a personal friend, i guess i

like consensus, if it's the right kind. >> exactly. >> a deal for dale, say, does not really do it for me. you know what i mean? ronald reagan created consensus, because he got compromising to rye deuce tax rates across the board and cut spending and give us a little free market capitalism. consensus for consensus sake, mr. farr, i kind of am underwhelmed by that notion. >> i think you have to have better than one party being able to walk away with policy in either of their preferred directions. threat got to be something good. let's try it for a while. >> all right. let's try it for a while. >> how about a two-party deal with republicans in congress, democrats in the executive, they block each other, and the cone senses is do nothing. >> i like that. >> michael farr, on that note, gentlemen, coming up next, ten reasons the v-shaped recovery is real. we're going to go kudlow 101

when we come back. and we're going to talk to professor marque perry of the university of michigan who coined the ten-reason argument. by the way. be sure to watch next tuesday when the godfathers of supply-side economies, art laffer and robert mundell, will give us their solutions on how to grow the america economy so that we remain first around the world. speaking of which, you're watching cnbc, we are first in business worldwide.

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all right. welcome back, everybody. this segment is about the letter "v." and the letter "v" signifies a stronger than expected recovery

due to the release of respect statistics that suggests we could be headed for a boom, at least for the next several quarters. before we introduce our guests, my great friend, university of michigan professor marque perry on his blog, ten reasons why the economic recovery is real. i'm taking some liberties in saying it's a v-shaped recovery. bear with me, i'm not going to do a lot of discussion here. i'm just going to show you what it is. first chart, the commodities, which has everything in there, not gold and oil, but industrials, agriculture and all the rest. please note the "v." all right? next chart. ism manufacturing index that came out not too long ago. please note the "v." by the way, that's a high level. next chart, here's a favorite. u.s. railroad traffic. this is an old-passed chart. railroad freight car loadings,

all right? here's the very. very important industry chart. i might add fedex is showing very good traffic as well. next up, this is the chain store sales that we just got yesterday. what does it track? a "v." by surprise, 10port, practically a blowout number. next one, household employment, which picks up the small businesses. this thing, a very surprising "v." look at that. 1.1 million jobs in the first quarter. pretty darn good. next one, corporate profits, the mother's milk of stocks, business and the economy. this is the best measure, irs tax-related profits, what does it show? a "v." and we've got another one, back to the crb spot. my whole point is a bunch of pictures show the v-shaped recovery is coming on stream, and it looks the next few

quarters, not forever, we've got taxes and regulations and obamacare and all that stuff. nonetheless, at least the next few quarters look a lot stronger than most people think and the key letter in the alphabet tonight is "v." here now is marque perry , university of michigan flint economics professor and famed carpe diemcreator and blogger, who has a fantastic post called "the ten reasons economic recovery is real." if there is a better blog in the entire web blogosphere internet, i don't know it. plus michael darta, chief economic at mkm partners, and chief market strategist at stevele nicholas. thank you, gentlemen. i took the liberty of taking a lot of your ten reasons and puts vs on them. i hope i haven't done you any

injustice in terms of your content and your analysis. >> larry, i think it's almost time to say that goldilocks is back, possibly. it's also important to think of where we were a year ago. a year ago the dow was at 6,500, today 11,000, up 68%. a year ago we had jobless claims, over 650,000, and now we're down to 450,000, so everything is up from a years ago, a lot of these indicators, is at a six-year high, a lot of these factors and indicators, are at two, three, and four-year highs. we are in a very strong v-shaped economic recovery. that's what i tried to sum summarize in those ten points. >> by the way, i love the freight car loadings, which is a great one. my friend has been pointing this out. two charts i didn't put up, restaurant activity and international air travel. just give me 25 seconds on

those. restaurant activity is improving, and you have international air travel rebounding to add to the mix. what can you tell us on those two? >> the restaurant performance index is up at a 27-point hood especially looking forward with optimism. and international air travel with passengers and with freight cargo is up by a large percentage increase from a years ago in february. >> last night on the show, we had -- i say this with the greatest respect, but we had this dopey millionaire who has inherited wealth from about seven generations, with about 50 of his pals and they want higher tax rates on upper end successful earners. one of your ten reasons is the millionaires are back. i love that, because i have an infinity for rich people, but especially the rich people who climb the ladder of opportunity, which means they are creating businesses and jobs for the rest of us. tell me about that. >> yeah, in 2009, the number of

millionaires was up significantly from 2008, still done a bit from 2007, but another indicator that wealth is being created and a lot of wealth was created in 2009. i think that's another strong indicator of a v-shaped recovery. >> joe batapaglia, you like millionaires. do you like the ten reasons? >> indeed, we looked at the indices that go into credit, and economies, and clearly from the bottom after $12 trillion of stimulus in the u.s. alone, you have the v-shaped movement. there's no denies it. it was worth while to be bullish during that time to get you to this point. however, what you need to do now is think about, as that is withdrawn, and we look over the next several quarters, what's pushing against all this? and unfortunately there's some

serious issues. credit contraction is still a serious issue. we've had not have meansful expansions in the past. unemployment is at an extraordinarily high level, with no indication of how to create the kinds of jobs we need for uptake. you've talked about stimulus not being stimulating, it was all about spending. at that rolls down and we haven't made investment, what is the u.s. economy going to look like. in the post apocalyptic time, the bad banks have gotten bigger. we've broadened the definition of "too big to fail." we still have the same dislocation with the chinese as we've had before and nationalized the mortgage industry, so when you look on the into the future, you have to wonder whether the "v" starts to bend a bit. it's good to go cautious looking at what's in front of you. >> fair enough. i totally agree with you. michael darta, you have become

the great expert about credit risk and corporate credit spreads against risk-free treasuries as a leading indicator. you're using the yield curve, money market rates, as forward-looking indicators, in your judgment, you heard joe's rebuttal to marque perry , in your judgment, is this v-shaped recovery petering out or gathering momentum? >> i don't think it's peetering out just yet. you've got some risks, but i think we're in the throws of powerful cyclical expansion. i think we'll put you pretty good numbers. the labor market i this will surprise people.

we just got a little taste of that in march. as we move into the spring and summer, that will intensify. so 2010 i believe will be strong. in an environment of a verdict cal yield curve and collapsing credit mark spreads, that is incredibly bullish. all the data is reflecting that. they were helpful moving into the disastrous period. >> that was your great call. you said we're in for a heap of trouble, as i recall. one thing, are you concerned that the strong -- we've already seen it in the ten-year, probably going to 4, 4 1/4,

4 1/2. mortgage rates are rising. would corporate rates rise too, and would that damage or injure your positive scenario? >> i'm not too worried about that yesterday. corporate rates haven't moved much, the spreads are very narrow, in fact continuing to narrow, so if you had treasury yields rising, and corporate rates moving up in that environment. that would be indicative of an imminent slowdown. it's not what we're seeing here. remember, the ten year wesht are went to 2% in the throes of the credit crisis, so to some decree this is a high-classic problem. >> marque perry , is there anything out there, and i ask this again in a sober serious way as i question the 11,000 dow, i don't want to get overexuberant. you have your ten articles, your ten points for recovery. but is there stuff out there that you see that worries you?

in particular, i think it's fair to say the one area that hasn't had much of a rebound is housing. >> i have reported, though, that in some of the hardest-hit markets, that they're going through a huge rebound there. i mean, the pending sales in march for miami real state is up like 72% from the year before, so i think we are seeing some strength in the real state markets, eye specially in the hardest-hit markets. we will have softness in the job market, but i think there are good indicators there with the increase in temporary help, and the 1 million private sector jobs that you pointed to in the last couple days. that. >> that's the small businesses. i'll tell you, mark, it seems to me all of a sudden in recent weeks, the isms came in blockbusters, the chain store sales came in blockbust eers an

the unemployment and the employment numbers, particularly the private sector payrolls and households, michael, this stuff just seems like the pace of recovery is actually picking up, not slowing down. i'll give you the last word. >> three indicators. the conference board puts out a leading index for jobs call the employment trends index, it's rising at the fastest six-month pace since early '94, a year in which we created on average about 300,000 private-sector payrolls for the full year. corporate profits lead jobs, private sector jobs by about a year. we're right about a one-year market into the corporate profit recovery, and then you look at the b, double abe trends, you

can see private senioritior payrolls at 2 to 300k on a monthly basis. >> look, joe, i'm not aiming this at you, but i want to make a point. i wrote a belong to my conservative friends. they are trying to discredit all the economic numb bers because of their opposition to oba obamanomics. i share that opposition, but you have to take the numbers where the numbers. things just look better. it may not be forever. as you noted, there's a love the threats out there, but to me 2010 looks like a year that will come in a lot stronger than anybody thought. >> again, we should focus on how much stimulus how much in guarantees have been put in place to give the appearance of full recovery. for example, transfer payments, the extension of jobless benefits, the fed's ongoing

effort to keep rates at zero and keep the banking system from folding in on itself, these are all real events. you have created a spending cycle and borrowing cycle from the government to replace what you lost in the private sector. they're calling for more next year. these are their numbers, then you have the federal reserve telling you, you know, we need to stay low for a longer period of time. we're cutting our expectation for gdp. if you look alternate first, second and third quarter expectations, why are they lower than the fourth quarter of last year if we're in a v-shaped boom that will carry us into '11, '12 and '13. >> i think you'll get 5% growth the rest of the year. higher tax rates, higher debt rates, these are all long-term problems. i got to get out. thank you ever so much.

marque perry , mike darda, and joe, thanks very much. this is a rising federal reserve superstar. he wants ben bernanke to move quickly to get that target rate up in order to prevent a repeat of a credit boom and then bust. and a new concept tonight, cowboy monitorism. i think it will help our nation's prosperity and keep inflation down and king dollar up. i'm kudlow, keep it right here. we'll be right back.

all right. some politics tonight. it's considered an unofficial kickoff to the 2012 presidential cycle with thousands of party faithful gathered in new orleans for the southern republican leadership conference. today it was former alaska governor sarah palin who stole the show. the former vice presidential nominee came out swinging against president obama for the too big to fail nation policies his administration supports. >> it seems like we are really learns what the president meant with his slogan "yes we can" when you turned that sound bite so a sentence "yes, we can spread the wealth around." yes, we can spend money we don't have on programs we don't need, and we're going to stick the

next generation of the bill. to a lot of us that's stealing. and yes, we can put our country back that's not on a good track, because this track will quadruple our national debt. and yes we can let the government take over one-sixth of the private economy with the mother of all unfunded mandates, obamacare. >> she's very smart to use this platform to make a speech, and i think tim pawlenty, the governor of minnesota, and mitt romney, former governor of massachusetts, they took a powder from this, and i think they made a mistake. they should come and face the music. in other news there's a new list out highlighting the influential players. steve liesman looks at which hawks and which doves seem to have the most market clout. hello, steve. >> good evening, larry. the envelope, please, with so

much fed-speak and so little time larry mire annually gives awards to members of the federal reserve who had the most fluent and moved markets. no surprise on ben bernanke winning the "i moved markets" awards. he has the most overall influence, the movement of the two-year note. but when it comes to impact for speech. philly fed chairman charles plosser takes the surprising award here. >> he was one of the earliest to be extremely clear and forceful with the view that the fed should tighten sooner rather than later, and to depart very significantly from the central tendency. >> which way do the fed officials move markets? turns on you janet yellen actually moves rates up. she's followed by plosser a

hoenig. as for the doves, nobody moves rates down more than retiring fed chair donald kohn. my guess, watch hoenig. he'sing calling for higher rates than colleagues. it's not hard to assume he's a major contender for next year's "power player of the year." >> thank you so much, steve. i want to go back to the thomas hoenig issue, i think he's the new superstar. all of you should read his railroads speech given in santa fe last week. it's an easy read. he calls for an immediate tightening of the fed fund's target rate to 1% in order to to

that in turn will wind up another credit and financial bust. in other words, get ahead of the curve instead of staying behind it. slam down the threat of future inflation. to use his words, put the market on notice that it must again manage its risk and be accountable for its own action, and stop relying on the fed's easy money. what great advice from tom hoenig of the kansas city fed. i want to go a step further. a cup points. the biggest problem with the fed is easy money in the 2002-2005 period. first, of course, the rates were too low for too long. in those days greenspan called it a considerable period. but second, they had something called a slow measured pace. do you remember that? what that meant is the fed was tell graphing the small, teensy

weansy incremental increases that took several years to get the fed back to normalcy. that helped promote excessive leverage and risk-taking. now, i want a different regime. i'm calling it cowboy mon monetarism. i want them scared to death of the fed. back in the 1980s, president ronald reagan was often referred to as a cowboy in his tough dealings with the soviet union. well, guess what? as we learned later, the soviets were in fact very scared of reagan's toughness in the cold war anticommunism, as he wanted to bring the soviets down. i want wall street to be just as afraid of the fed as the soviets were afraid of ronald reagan. when the fed does move and they

ought to move soon, as mr. hoenig says, they shouldn't go in quarter points, they couldn't tell wall street that they're doing every minute and every day. they should surprise the street with tough half and three-quarter point changes. that will make wall street manage their risks and reduce their borrowings in a much more constructive way and will also prevent a new credit boom that will lead to a credit bust. i want the federal reserve to be thought of as a cowboy. you never know what they're going to do, both guns drawn, pulling the interest rate triggers. if they do that, then this credit cycle story will have a happier ending. you know what, folks? sometimes being tough and unpredictable is the best medicine. cowboy monetarism.

coming up, how they ran the company on the hill today. o. my god. i have two ideas for fannie and freddie. number one. privatize them. number two, privatize them. let's get out of the bailout nation. back in a couple minutes.

all right. a couple ex-fannie made executives testified today in washington, d.c. they actually acknowledged that the business model for fannie and freddie, which is to say private profit to the shareholders, but if you screw up, taxpayer liabilities, we have to bail them out. a lousy model. so i want to ask this question on this side of the tease -- should fannie and freddie be privatized? here's our dynamic duo, former labor secretary robert reich, is the author of "super capitalism." and steve moor author of "return to prosperity." you heard me. give me a quickie, and then we'll come back. secretary reich, you first. >> yes, i think it should be

privatized, no less than wall street banks should be privatized. let's privatized everybody. no more bailouts to any big organization. >> steve moore, this is a burning bush moment. >> i sure am. illegal privatize that, and i'll up the anti. i want to private az university of california berkeley. >> unfortunately that's the way we're going. >> ucal berkeley is 80% privatized. we won't debate cal berkeley. we're going to come back and talk about how to get rid of fannie and fredry. stay with us.

all right. we're talking fannie and freddie. they testified before this financial crisis committee in washington. steve moore, let me go -- you guys would both like to privatize. i want to go to a separate but related subject. we know the model for private profit and taxpayer bailouts doesn't work, but i want to get into this. how responsible for the financial meltdown was fannie and freddie, acting upon the mandates from hud, the housing

department, andrew cuomo was the secretary, congress, barney frank and his ilk, essentially saying we want you to buy up these mortgages we made that were given to people that could not afford them in the first place. how culpable is fannie mae, for example, for the wholenings meltdown, steve moore? >> i think they're at the epicenter. the problem is with these institutions, you're right, that they have these kind of private profits, but they socialize the losses, but it's deeper than that, and maybe something we would agree on. you have these institutions making massive contributions to members of congress, people on the banking committee, that's one of the reasons -- and this is republicans and democrats -- a reason they turned a blind eye to the activities. if we can't privatize them, at least let's get rid of the yesterday of 100% guarantees. i have been risk sharing, i want

the people who originated the mortgages to share the risk, that way you don't get these lousy mortgages that are made. none of tha is happening, none of these reforms are being put in place. >> you know, steve, i was struck by the parallels between the testimony of the head of fannie mae and also chuck prince yesterday when he was asked why did citigroup main all the loans they did? and chuck prince and fannie mae said the same thing, that's where the money was. if we didn't go there, that's where our competitors would go. this is what they want to do. their compensation was tied to getting big profits. whether it's fannie or freddie or goldman sachs or citigroup, that -- they did exactly the same thing. that's the problem. >> i think there's another story, but the moral of that important story, bob reich is, end too big to fail and get rid of these government enterprises. >> larry, this is important, the

resolution authority that's built into the senate bill and probably the house bill, that is not going to be enough. you know as well as i do, if they big companies, if they start going down, they're all using the same techniques, the same profit-making strategies, if they start going down, there won't be enough resolution authority or enough will not to bail them out. you have to control their size, you've got to put a maximum on the size that these companies -- >> i don't agree with that. first of all, i think we all agree we have to get rid of too big to fail. i think it just means you set rules that basically wipe out the shareholders if these companies like citi made bad decision. >> you're too much of a lefty on this. i'm shocked. >> hold on, back to fannie mae and freddie mac, i think this reform bill has some decent protections, but there's no protection of taxpayers, nothing to deal with fannie or freddie

in this bill or any bill and we bailed them out to the tune of $400 billion. >> your intentionses is great, we pretty much agree, unfortunately nobody is taking action on fannie and freddie, and we now own them in perpetuity, which means they will be directed by politically driven mandates. >> no question. wall street is the biggest. larry, wall street is the biggest contributor to congress. >> i got to go. >> there's no difference. >> robert reich, steve moore, thank you gentlemen. see you later.

once more, my theme about cowboy monetarism, i want wall street scared to death that the fed will shoot at them again and again, and they won't know when and when. that would keep wall street honest.