records business blew up, so to speak. when i've been following these blow-ups, do not buy the first day even if you're crazy about it. look at all a. first day down, huge. second day down, big again. promise how to find it. just here on "mad money." i'm jim cramer and i'll see you tomorrow! the new obama care enrollment numbers are out and in a word they are dismal. far fewer people have signed up than the administration hoped and that's just one reason why senate democrats, especially the ones up for re-election this year are demanding more changes and help from the white house. so far the president hasn't responded to them. john boehner is demanding conservative groups get in line behind the new budget deal. he said critics of the deal are being ridiculous. mr. boehner, really, are they ridiculous? breaking news tonight. hawkish stanley fisher, that's

right, he's a former governor of the central bank of israel and looks like he'll be appointed as the vice chair of our federal reserve. i think that's a big reason stocks sold off today because mr. fisher will be a counter to the dovish janet yellen but fisher is one smart guy. all those stories are coming up on "the kudlow report," beginning right now. we're live 7:00 p.m. eastern 4:00 p.m. pacific. i'm larry kudlow. this is "the kudlow report". we'll get to the obama care and budget news in a moment. first we have to start with a very important piece of developing news on the fed. let's go over to courtney regan for that story. good evening. >> reporter: stanley fish has been picked as the next vice chair of the fed and that's once janet yellen office into the top

spot. stanley fisher ran the bank of israel. fisher is considered by many to be a hawk on interest rates which could change the balance of power inside the fed. >> thank you. that's exactly right. if janet yellen is the empress of the do was, professor fisher is the mench of the hawks and this guy is a smart guy who kept inflation down in israel and made the israel currency a stable reliable currency. there will be a hawk. sound money. i'm all for it. let's move on. two months after its disastrous launch secretary sebelius finally call for an investigation into healthercare.gov. nbc news brian mooar joins us with that story. good evening, brian. >> reporter: the secretary

expanded on her obama care mea culpa and ordered an inspector general to figure out what went wrong with the roll out of the healthercare.gov website. secretary sebelius said enrollment for the website has gr quadrupled from october november but by the end of the month 365,000 people reached the enrollment finish line. that's a fraction of the millions the administration had set as a target for the first-round ever sign ups. republican critics say the way things are going looks like more people are going to lose their current policies than will be signed up for new ones. that's the practical crisis for the white house. the political crisis here is on full display in the latest nbc/wall street journal poll. president obama's disapproval ratings have jumped to a record 54% and for the first time a majority of americans disapprove

of the health care law. 50% consider it a bad idea. only 34% consider it a good idea. larry, the good news for president obama is only 26% of people in that poll believe that health care, obama care, should be scrapped completely. >> brian mooar, thanks very much. we got a lot to cover. now, house speaker john boehner beat the drum again today on president's obama care r brokbr promises. >> obama care continues to wreak havoc on families and our economy. i think when we get to january 1st more americans will have lost their health insurance than will sign up under the new obama care policies. this is not what the president promised the american people. he promised them they could keep the health plans they like, turned out not to be true. president promised the american people they can keep the doctors

that they had all these years. that's turned out to not be true as well. it's time for the president to get serious about stopping this law before it wreaks any more havoc on american families, small businesses and our economy. >> all right. not only are the president's promises in question so is the information on washington, d.c.'s hearth exchange. check this out. an e-mail warns in bold red not once but twice that staffers should not assume they are covered unless they have seen a confirmation letter. no matter what the website says. okay. e-mail goes on the say that those that did not successfully enroll due to technical glitches will be granted a special enrollment extension to the january 1, effective coverage date. but senate staffer aren't the only tech glitch victims. reports indicate 30,000 or more applications nationwide could require re-evaluation.

i don't know who will represent them. we welcome to the show first time, a former omb associate director for health under president clinton and our great friend robert costa, cnbc contributor. so much to talk about. robert costa, let me begin with you. what is this sebelius is referring the website breakdown to the inspector general? that's not what inspector generals are for. they are for corruption and misleading and illegal stuff. the website is the website. it's a technical problem that they bombed out on. what is this, passing the buck. does she think the ig will get fired instead of her. >> interesting political back story. last time we saw secretary sebelius come to capitol hill she was quite combative, very defensive of the law she was trying time pleament. now you see her having a reform study to look into the problem. the reason for this senate democrats, vulnerable democrats up for re-election in 2014 are feeling nervous and they want the administration to do

something. >> so, they thinks -- she thinks they will off load at least that part of the rob. i mean there are serious other structural policy problems with this plan but in terms of the computer breakdown she thinks she will off load that to the inspector general. >> the battle within the democratic party the administration wants to characterize this drama as a time of fixing the law. people like mary landrieu, these democrats up in 2014 they want more than fixes. they are getting criticisms back home. they want wholesale reform of this law. that's the friction right now on the left. >> dan, that's right, robert costa, all the reports, the democrats are in trouble on this, especially the ones up for reelection. they have a laundry list of changes and reforms but the president meets with them but hasn't done anything. >> it's hard for him to make fundamental changes to this law. the market has changed.

you change the way insurance companies are making money, you change the way hospitals have incentives to deliver quality and it's really hard to go back on these at this point. >> even deadlines. >> deadlines can slip. that is what i think they will do. start to move things. already they are moving the goal post back. you see them talking about first year enrollment. you see them talking about march and april and not really talking about what's going to be accomplished before the end of the year. >> just to follow up on this whole business of the senate alerting the senate staffers that unless they have a piece of paper they are not really enrolled and can't join this thing. these a-34 forms the back end of the computer operation which is about enrollment and payment. i'll venture to say there are hundreds of thousands of americans out there that may suffer the same fate as senate staffers. who is going alert them? >> this has to be a warning to everybody in the market. if you haven't heard from your

insurance company you got to call them and contact them and get affirmative recognition that you're enrolled. >> robert costa, you got pink slips of cancelling insurance. now you got the possibility that you think you signed up but you didn't really sign up because the enrollment at the back end of this is busted. how is that resolved. that sounds like a double whammy. >> the administration and democrats on capitol hill are worried about these implementation problems. the enrollment seems to have been stymied at each step. the real fear on the democratic side is not just implementation but come 2014 if the premiums start to go up and there's a price difference that's the political fear. >> you know the premiums will go up. we know that. we know the deductibles are going up. we know a whole lot about that.

that's why these polls are so disastrous. >> it's unbelievable to see the president, 54% disapproval. i think you're going to see a lot of democrats in 2014 start to distance themselves from the president in the way they never did in the 2012 cycle. >> thank you to both. now switching gears to our other top story conservative groups are on the war path over the bipartisan budget deal struck last night. it may be the best they can get without a government shutdown but it could also mean that the sequester budget caps are gone forever. that was a major republican achievement which i think helped the economy. now, first up. here's speaker john boehner fighting back against conservative criticism. take a listen. >> you mean the groups that came out and posed it before they ever saw it? they are using our members and they are using the american people for their own goals. this is ridiculous.

listen, if you're for more deficit reduction, you're for this agreement. >> one of these groups heritage action said, over the next few days lawmakers will have to explain to their constituent, many of whom are our members what they've achieved by increasing spending, increasing taxes and offering up another round of promises waiting to be broken. that will be a really tough sell back home. will conservatives back the deal? here's tim huelskamp. thank you for coming back on. you tell me. look, i'm a great fan of john boehner, but just blasting the conservative political action groups isn't the issue, the issue is the issues. what's inside this deal. you know, paul ryan is trying to sell it. shouldn't boehner just let ryan sell it rather than blasting off on these political action groups? >> larry, let's be honest here,

this is not a deficit reduction package it's more spending that's why it's called a bipartisan bill because both sides will increase spending $63 billion. i want will blow through the sequester two years ago that was set up for a massive increase in the debt limit. i fear we'll continue in the future to continue to ignore the sequester. but the deficit reduction claim is somewhere down the road, eight years down the road, nine years we'll cut spending. we'll raise spending now but trust us congress will cut spending perhaps in hillary clinton's second term. i under the speaker getting upset. but this is a spending increase in the next two years which is why the democrats have signed i want to be. >> paul ryan makes the case, ryan is a smart guy and he's a conservative. i define him as a conservative. he says that you are all going to get 92% of the sequester

budget cuts. 92%. yes, you will lose some. you're quite right. you'll lose about $65 billion in the next two years. no income tax. that's a good thing. no shutdown. that's a good thing. now how will you and others and other conservatives in the republican study committee how will you react to those paul ryan boys? >> it will mean more revenue from americans to washington. there are fee and tax increases included in there. call them whatever you want. it's more revenue going to washington's coffers for more spending. at the end of the day if he pass a clean cr we get 100% as a clean wall. democrats were saying give us a clean cr. moderates in the republican party were asking for a clean cr. which is current law. we'll pass this. then we can continue to move forward. but at the end of the day -- >> tim that was my own personal view. you guys had the whip hand. because the sequester is current law.

okay. so a clean cr. then i heard that the defense hawks and other moderates who might want to spend on other things could have cost the republicans 40 to 50 votes on a house floor vote so, therefore, the clean cr you describe which, again, was my own personal first choice would never have gotten through. >> larry, if it's never went by leadership, nothing won't pass here unless the leadership steps forward. conservatives are in a strange position. this happened again and again. conservatives oppose a bad deal then once the deal passes we're the ones left holding the bag and say hey we'll hold those cuts. i oppose the sequester cuts because i want ad bigger, morrow bust smarter package of cuts but john boner and paul ryan said we got to do this now and harry reid said we got to do this. now conservatives are the only ones saying let's maintain those cuts and they were very small

cuts. but i would say if you say it can't pass at least try it on the floor which again there were 250 members of the house demanding that just a few months ago. >> look, i agree with you. i think the budget caps, the suspension for 2014 and 2015 may signal the end of the budget caps. i think that's a threat. i'm very sympathetic. some other stuff ryan got. on the federal pension co-pay, i think it's high time they shared that. the military they had a little lower cost of living adjustment. that's another entitlement reform. the pension guarantee program, the private corporations should really pony up for that. it's their pension plans that are being financed by the taxpayers. i mean i thought those were pretty reasonable sensible ideas from ryan. >> oh, yeah. those were things that should have been done a long time ago. actually if republicans fought harder during some of these other budget battles we would have gotten those. when you roll back to when they

pass the budget control act, when they pass the sequester levels of spending in 2011. in exchange they got an increase in the debt krilg. this is what they told us was the victory. this is what republicans in charge this is what we got and they are trading it away. i'm disappointed. i can't say they could have negotiate ad better deal. just because this budget might pass tomorrow doesn't mean harry reid will agree to this level of spending in january. we have to pass the omnibus bill and democrats are smart enough they will ask for more between now and january. >> are you a yeah or nay vote on this bill? >> i'm a no vote. >> congressman tim huelskamp. you heard the big news today pope francis has been name "time" magazine's person of the world. is liberal secular media missing the message? i'm telling you how worried i

am, with all deference and love for the holy father i'm worried about his continued attacks on capitalism. i think capitalism is the best way to end poverty. and, folks, you know it's my mantra. don't forget free market capitalism is the best path to prosperity, not argentina. that's a different story. i'm talking about reagan, thatcher, capitalism spreading around the world and getting rid of poverty. that's the message i want the pope to bring. i'm kudlow. i'll be in church on sunday but we'll be right back after this segment. americans take care of business. they always have. they always will. that's why you take charge of your future. your retirement. ♪ ameriprise advisors can help you like they've helped millions of others. listening, planning, working one on one.

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pope francis named "time" magazine's 2013 person of the year today. they called him the people's pope. the magazine says pope francis has the potential to transform the church. but, new abc news poll shows that an impressive 92% of catholics view pope francis favorably. but i must say with all humility and respect as a church going catholic i remain concerned that the liberal secular media are embracing the pope for all the wrong reasons and i remain critical of the holy father's attacks on capitalism and markets which are the greatest cures for poverty of all time.

so let's talk about this. we welcome president and co-founder of the akron institute and naomi riley author and former "wall street journal" editor. naomi, i begin with you. has the pope made statements -- i guess at one point he said don't obsess about abortion or traditional marriage. has the pope made statements that's brought the liberal media into his camp for the wrong reasons? >> well, i don't know about whether it's brought them in for the wrong reasons. it certain hi brought them into his camp. he has said we need to focus less on the social issues. he has definitely offered, i would say, a kind of liberal economic take that may not be in line with your thinking. but the question is, you know, whether he's brought along anyone besides the media and the evidence so far suggests not really. >> just to follow up on that what you're saying is so far

there's no evidence of more church goers, is that true globally or just the united states? what do we know about that? >> well, what's interesting, so a couple of weeks ago the pew form on religion and public life did a survey of american catholics and it found what they called a no pope effect. no pope francis effect which is to say the number of, the percentage of people who are going mass each week and the percentage of people who identify themselves as catholic has remained flat over the last two years, in other words there has been no change since this pope took over. in addition to that there have been some reports coming out in europe and other places suggesting that maybe there is a pope francis effect and one of the reasons that pew undertook this poll they wanted to see whether this was true in the u.s. and they found it not to be the case. i think these other reports from other countries, it's a little bit hard to sort out. >> it's little early. in all fairness. >> that's exactly true. i think it's a little bit early

to say because, you know, the fact of the matter is people don't pop up one morning okay i'm going back to church. ate lot of people who have taken a long time to leave church. >> i haul them in in connecticut. >> very kind of you. >> there's a local diner. i try to bring a few with me. >> there's enough pews in my church. i've been the head usher in my little church for 10 or 11 years. father good to see you. i want to ask you -- i read the whole exortation. there was quite bit about economy. the trickle down effect and free markets don't work to help poor people. he stems have a sense that the state and the government should exercise controls over the economy? i mean whatever happened to g d

godless communism and godless socialism. >> i think you are too hard on the pope. first of all, let me talk about this francis effect. that pew study was over two years. this pope hasn't been in office a year yet. and let me tell you in rome i just got back from rome the other day. the attendance at the audiences in rome are overwhelming. i had a guy come up to me in the airport at kennedy airport and just say are you a catholic priest. i said yeah i am. he said i just want you to know i like your pope. there's that. the other thing is, there are 11 paragraphs on economics, not all of them negative because he praises the noble vocation of business of entrepreneurship. the trickle down translation isn't exactly what he said in the spanish and the italian so there may be a translation problem there. i don't want to put too much

weight on that. the fact of the matter is don't 0-pose idolatry of money. don't you oppose the crony kind of capitalism that we see in argentina and elsewhere. >> i'm afraid the pope is using the argentine experience to generalize. >> that may be. >> i spent a lot of time in argentina. the one government they had in the last couple of decade, i was there as an adviser and pleased to do so. but i think this idea, the statement that the pope made that the state should be in charge is something that i find extremely troublesome. >> i have to see that text because he decries the welfare mentality. snee >> he wants the state and government to exercise controls. argentina is a perfect example where the government and state runs the country and doles out

favoritism. the argentineans are impoverished as they were 50 years ago. >> you won't get an argument from me about free markets and a vibrant free economy that's free. he's teaching in a non-ideological way. he situates himself in the whole of the church's tradition on these kinds of issues which includes the principle of subsidiary that needs are best met at the local level. let's hear him out. in terms of generalizing from his experience of course he's going to do that. he's seen wretched poverty. >> just tell him i'm there every sunday and for his holiness please, please, dear lord, please go more towards the markets and capitalism that's the best cure of poverty.

i agree that the gospel must cure poverty. i got to go. thank you both. now folks things continue to heat up in the ukraine where state police almost got into a violent clash with protesters today. the people want more economic freedom and i hope they get it. i'm kudlow and we'll be right back. ♪

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welcome back to "the kudlow report". i'm courtney regan. tension escalating between protesters and ukrainian police. protesters are pushing to break twice russia and getting closer to eu and more free market economics. today police converged on protesters taking down barricades and tents. protesters fought back. the back and forth went on for hours before the police finally backed off. there's an urgent situation on the international space station right now. one of two systems stopped working. nasa says it's not an emergency. first they will try a software patch. it may require a spacewalk to try to fix the problem. and something that might bring holiday cheer. there was a virtual santa in the toronto and hamilton airport. passengers told santa what they wanted for christmas. when they landed in calgary the presents they asked for were on the baggage claim.

>> no way! >> one family got a big screen tv. the guy who asked socks and underwear wished for something else. it turned into a great commercial, great pr move but they had folks dressed in blue and white. went along with their branding. asked what they wanted for christmas. while in the air they went shopping. the packages came out on the baggage claim. >> very clever. many thanks to courtney regan. now we got two important stories coming up. one, the hawkish former head of the israeli central bank that is the hawkish stanley fisher looks to become the vice chair of our federal reserve. and he will offset janet yellen's dovishness, important story for today's stock market and way beyond. second, some conservatives as we

discussed earlier are trying to scuttle the budget deal struck on capitol hill. last night do they have a point? that's going to be next up on "the kudlow report".

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the house is set to vote on

the ryan-murray two year budget deal tomorrow. two big questions remain unanswered tonight. are sequester budget caps dead? and are we back to higher revenues and fees for more spending. here now is martin frost and mr. jenkins from the "wall street journal" editorial board. some people are saying paul ryan won this round because they got most of the square budget cuts, 92%. no income tax. no closing of corporate loopholes. and no shutdown so the gop can focus on the obama care catastrophe. now do you buy that? is that fair or is that just, you know, too conjured up? >> i tend to agree with that. in a situation of divided government the big issues, the

big cissues need to be decided n an election. i think secretly a lot of democrats are going to like this deal too. they like the idea of going home to say they voted for a budget deal that did not extend these unemployment benefits, you know, in an irresponsible way and with detroit looming in the background saying they are beginning to deal with pension excess at the federal level. republicans are making headway here and the fact that democrats want to support this thing actually means the republican message is getting through. >> will democrats vote for it in the house? will democrats vote for it in the senate? will democrats take this home and say look we made a deal we found common ground, re-elect. does that work for you >> i believe democrats in the senate will vote for it. i think democrats in the house will vote for it. look i think the right-wing of the republican party is crazy to oppose this deal. they suffered badly because of the government shutdown.

they gotten well because of the problems with obama care and why do they want to go back to a situation where the country thinks they are irresponsible on the budget? this is not a bad deal. it's not perfect. both side will find things that they disagree with but this is the best thing for the country and quite frankly i'm not a fan of the republican party but this is not a bad deal for the republican party at least it doesn't make them look like they are nuts. >> all right. let's go there. i mean i think the best thing for the country, would have been substantial entitlement reform along pro market lines and substantial pro growth tax reform. now the chances of getting that are between zero and minus ten i suppose but is that notion dead or do we just have to wait for the mid-term election? >> we have to wait for the mid-term election. maybe it's time to reassess the shutdown episode a little bit. we had the best quarter of gdp growth virtually since the obama recovery began.

we have had job numbers coming in better than expected. so, you know, all those wall street people whining and whimpering the shutdown would ruin the economy, maybe it's a little bit bullish for the economy when people see washington getting serious about these issues. i think this deal is a direct result of that and maybe are moving things in the direction you're talking about towards 2014. >> see my -- >> my problem is i'm in the camp that says smaller government is good for the economy. i fully agree with what was just suggested the shutdown didn't hurt. i think the sequestration and budget caps were good for the economy. not bad for the economy freeing up resources. but i guess the issue is, i guess the issue is how long can we stay in this position? something is going to break here. something is going to break. >> moving voters off the dime and this is a step towards that. >> there's a number of us in the

democratic party who are pro national defense. i was my entire career. and i think this agreement is good for the defense of our country. look i have a nephew in annapolis right now. i have a godson who graduated from west point. i have a niece that graduated from the air force academy. i don't want to see our defense weakened significantly the way the mindless sequestration did. there's a lot in this that's good news for both parties and good for the country. >> first of all, god bless for all your family members in the military. i remember you were a defense hawk. as i understood it, the defense hawks in the republican party and some others, some appropriations people that really are not so, i think so blessed on their thinking, but nonetheless they couldn't pass a clean cr so they had to make a deal. is that fair martin frost? in other words, something had to give even though this is a small deal, it couldn't have been passed just on a straight cr roll call.

>> that's right. because there was unfairness on both side. there were democrats concerned about the type of domestic cuts you had. there were democrats and many republicans concerned about defense. they would have had a very hard time passing a clean cr. let's remember too, larry, while this doesn't raise taxes but does pay for what congress is doing. people won't like some of these fees but they are not the end of the world. the airline industry won't like what's done. there are others, federal employees won't like the fact that new federal employees have to pay more into their retirement system. these were reasonable approaches. this is paid for. what the republicans are complaining about they don't like that it's paid for -- >> i don't mind that. reagan was in favor of user fees. i don't mind that. particularly this pension guarantee corporation and you had entitlement reform regarding the co-pays for federal pensions. that could be as paul ryan says a pre-cursor of largers

entitlements down the road. >> it had symbolic import and the fact that democrats signed on is important. on the whole ate pretty good deal and we should -- i hope the country is following in this direction and picking up on these messages and maybe it will show through how they vote in 2014. >> thank you, gentlemen. we appreciate it very much. now, folks, in case you missed at any time kudlow report made history last night. former fed chairman alan green span agreed to a live debate with the man who blames him for thoughts bubble, that's john taylor. so what do we know tonight that we might not have known before green stan and taylor tangled last evening and who do the experts think won that debate? all right. there's always a winner and always a loser and that's our topic next up. please stay with us. stick with innovation.

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from philips sonicare and save now. philips sonicare. last night i had the privilege of moderating the first-ever face to face debate about who is to blame for the bubble and that was between former fed chairman alan greenspan and former treasury undersecretary john taylor. we had it right here on this show. we were down in washington, d.c. now here's a clip from that

debate. >> there was a very high correlation between short term rates and long term rates including mortgage rates prior to 2003. the correlation since then is zero. and there's been a complete disconnect between what the federal reserve is doing in monetary policy and the long and short term rates. >> the evidence the short rates -- >> essentially what the fed is doing which we didn't do back in those years is going out and purchase long term assets in a way that presses the market. that's not what was being done back then. the long term rate continued to move pretty much change -- >> that's beside the question. >> it's not. >> we're talking about the low long term rates. low short term rates on the long

rate. that's part of the reason the fed does forward guidance now to the extent that it was a disconnect it was because of your very unusual low interest rate policy in '03, '04 and '05. >> who won last night's debate is the question. he fellows, i want to put a chart up on the full screen i hope you can see this. it's about interest rates the two rates the short term federal funds rate which is the fed's target rate in the yellow green. and the long term treasury bond rate, that's in the blue. that's the decade of the 2000s. they move together the long term rates fell when the fed brought down the fed rates to 1% and it rose when the fed tighten up it policy and in '08 and '09 the

rates came down. i'm not here to pre-judge mr. greenspan. there's still a relationship between the rates. jim, if you saw the debate or saw parts of the debate who do you think had the upper hand in that? >> credit for john taylor for not going easy on chairman greenspan just because he's an older man and up in the years. i thought that was a well spirited debate. the problem is that the chairman greenspan was making an argument that the fed is basically impotent. that listen it can't control rates. you had this huge surge of workers after the cold war. it overwhelmed the fed. i don't think the data support that. i think interest rates were too low. the fed was too easy. you have to look at rates. just look what was going on with nominal gdp in 2003, '04, '05 and '06.

>> i made that point. i hope you're proud of me for making that analogy because actually -- no, no i said this to alan, don luskin. i mentioned three indicators. one was the big jump in gold. two was the big drop in the exchange value of the dollar. and three, nominal gdp growth basically doubled from 3.5% to close to 7% and i asked alan did that not suggest to you that the fed was too easy. he didn't actually respond to that directly. >> what a surprise. >> well, okay, look i have enormous respect and he's a brilliant man. but, don luskin was the fed too easy? do you think they kept rates too low for too long? >> i admire both combatants in your debate. taylor nailed it hands down. there's no question about it.

the evidence speaks for itself. we had a credit orgy at the same time the fed kept the fed rates pinned to 1% for what it called a considerable period. bernanke himself has actually already weighed in. he gave a speech where he confessed no we didn't cause the bubble but here's the mistake we made that made us cause the bubble that i'm claiming we didn't cause. what it was they thought inflation was too low. they thought there was a risk of deflation. this is when he gave his helicopter speech. all the data that they used and bernanke admits this in his speech all the data they used to get worried about low inflafgs revised away. it was 1%. so they had a good reason to make the mistake they made but for the sask fighting a non-existent deflation it's self evident they created a credit

bubble. >> that's why i like to use market indicators as well as the gdp data. look, john taylor, i'll just close with this. john taylor fought bernanke if you remember, don, he fought bernanke, i believe it was the american economics association but wherever taylor gave a speech -- >> it was a speech he gave at jackson hole. >> right. and he criticized bernanke. we had him on this show and had a solid interview. i got to give john taylor credit. whatever viewers think whoever won that argument john taylor is a guy who stands up for what he believes in. there's no question about that. gentlemen we're a little truncated. thank you. don luskin is coming back to do some stock market work. please keep this debate alive on twitter. just tell me what you think about this debate and you can use #bubbleblame. now what's behind today's steep sell off on wall street?

i have a thought. it could have been about the hawkish stanley fischer who will be the next vice chair of the fed. that's what i'm thinking next up on "the kudlow report". and to keep our commitments. and we've made a big commitment to america. bp supports nearly 250,000 jobs here. through all of our energy operations, we invest more in the u.s. than any other place in the world. in fact, we've invested over $55 billion here in the last five years - making bp america's largest energy investor. our commitment has never been stronger. they always have. they always will. that's why you take charge of your future. your retirement. ♪ ameriprise advisors can help you like they've helped millions of others. listening, planning, working one on one. to help you retire your way... with confidence. that's what ameriprise financial does.

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all right. seeing red on wall street. major indexes posted their biggest declines in more than a month. dow was off 130 points. nasdaq fell 57. s&p 500 lost 20. dipping back below by the way the 1800 line for the s&p.

anyway, let's go straight to our ice investors, we welcome back carol roth and don luskin. carol let me go to you. i know it's hard to know on a day-to-day basis. but i think the news of the appointment of stanley fisher to the fed, he's a hard money guy. he saved the israeli shekkel. is that plausible? >> i think there's more of a cancellation there than the fact that they are going to move in a hawkish direction. i have a different theory. what's happening i think is risk and reward. we're three weeks out from the end of the year. we have the fed taper talk coming down the road. if you're doing well and your portfolio is up big time, you're going to want to take some money off the table and lock in. especially knowing the fed will be coming out talking about

tapering, whether it's the end of this month or next month or whatnot there will be a lot of volatility around that. why take the risk and why not lock it in. >> don luskin, number one stanley fischer will he make a difference and make the fed tighter. number two, year end profit taking? >> i think there will be profit taking here even if it wasn't year end. corrections happen. no surprise there. but i think you're on to something, larry. it's a perfect storm. ultimately it's good news to get a first class mind like stanley fischer on the immediate. it's not a question of hawk versus dove. it's a first class minds balancing third class mind. on the other hand you got to admit the economy has been forming so much better. had that big gdp upgrade. great jobs number. everything is moving in favor of tapering. we should have done it in september when bernanke originally promised it. he's got two more meetings. i think he wants to hand yellen

a fait accompli. embrace the taerp. a huge buying opportunity. fed must stop probing these unmonies to of this multitrillion dollar experiment, the tapers -- >> that's why fisher is so interesting to me. fisher taught most of the great economists in the country. carol, third quarter gdp was up 3.5%. but inside that number was record profits. these are the irs profits so you can't mess with them. $2.1 trillion of profits. 11% of gdp. that's got to be good. >> i'm going to say i'm going to be cautiously optimistic. if i look forward to 2014 the g word i'm looking for is growth. we need to see that sustaining not just on the bottom line because we know the irs profits are different than the financial

engineering profits but i want to see that on the top line level. i want to see the top line growth go. if we can achieve that and get the fed out of the way and get these companies investing in capital i think that we're going to have a decent, cautiously optimistic 2014. >> we got to get out. carol, don appreciate it. that's it for this evening's show. i'm larry kudlow. free market capitalism mr. pope. we'll be back tomorrow night. my mantra? family first. but with less energy, moodiness, and a low sex drive, i saw my doctor.

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