something feels like we're slated to go down. the banks start tomorrow. i think they'll be good. will anyone care? i always like to say there's always a bull market the spin isn't working. team obama releases long awaited demographic info on who signs up for the obamacare plans and there's no covering up the bad news. only 24% of the enrollees are 18 to 34 years old and if that keeps up, insurance costs will explode. so are we closer to a bailout tonight? we have the latest. and why are women under more economic pressure than men? a new study from maria shriver tries to explain why but does it downplay the key challenge that i think is family breakup? maria shriver about to join us live to talk about it. and it looked like it was going to be another flat day on

wall street, but all of a sudden we had the worst sell-off in three months. we are going to take a look at what drove stocks down and by the way, i happen to like this minor correction. i happen to think people should stay the course for long run wealth creation. all those stories, much more, coming up on "the kudlow report" beginning right now. good evening, everyone. i'm larry kudlow. this is "the kudlow report." we're live at 7:00 p.m. eastern, 4:00 p.m. pacific. let's get right down to the floor of the new york stock exchange for more on today's big 179 point dow drop. bob pisani joins us with the news. good evening, robert. >> stocks started mixed but moved lower midday and closed essentially on the lows for the day, larry. goldman sachs issued a report saying valuations were lofty by almost any measure. then midday, atlanta fed president dennis lockhart said he would continue to support the

fed's tapering program. although lockhart reiterated his support depended on the economy improving, traders interpreted this to mean there's a lot of momentum to continue tapering at about $10 billion a month despite the weakness in the jobs report. another issue for the market is the strength in bonds. many are speculating that pension funds have taken profits on their big stock gains in 2013, and are now using that money to buy longer dated bonds which offer more attractive yields that are a bit closer to matching their obligations. despite the issues, larry, there is little sense of panic in the markets. the volatility index dropped befo below 12 today, the lowest level since august, although it did go up late in the day. volume was a bit above average. back to you. >> many thanks. appreciate the rundown. we'll get to the stock market later in the show. the number of americans living below the poverty line has hit a record high during the obama presidency and shockingly, according to a new report, one in three women are now either

living in poverty or teetering on the brink. that's 42 million women, plus 28 million children who depend on them. but just why are so many people on the economic brink and is female poverty caused by the marriage problem, family breakup or misguided government policies? here now to discuss, nbc news special anchor maria shriver, who is out with the new eye-opening report which details the financial struggles faced by women. maria, welcome. i'm reading the shriver report. i think your numbers are spot-on. everything i found out, all spot-on. the people that did the report did work. what's your solution? let's begin right there. this is your game. what's your solution? >> well, there's no one solution, larry. what we're talking about in here is that government plays a role, business plays a role and women themselves play a role. as you said, one out of three working women in this country are on the financial brink. minimum wage workers, two-thirds of them are women.

70% of those don't even have one sick day. so we are calling on government to play its part, businesses, we talk about what makes a business place so that workers can thrive, so they can retain women, because women are good in business, they're half the work force. we are also saying to women themselves look, if you want to stay above the brink, you've got to pursue your education, you've got to stay in college, get a college degree. you've got to be able to provide for yourself. don't wait for someone else to provide for you. delay family planning as long as possible. be smart about money, understand that every decision has an economic consequence. so there are things that women can do, men can do, faith-based organizations can do, government and business, and bring them all together. >> fair enough. let me give you the kudlow plan which by the way, overlaps with the shriver plan. >> oh, good. >> we're not far apart. i have this four point plan. finish your education. you mentioned that. >> number one. number one. >> then go out and get a job.

that's point number two. >> you have to get a job with a living wage. >> yeah, look, if you finish your education, you are going to get eventually a very good wage. then get married, after you have some stability, and then after you have been married awhile, have the kids. that's the kudlow plan. it is not a very original plan. other people have talked about this. in other words, i think the teens are jumping in too fast. i think the family breakdown is a huge part of this problem. maria, if we don't fix the family breakdown, these numbers are just horrible. 40% in poverty. you can almost predict it. if there's a one parent family, 40% land in poverty. >> well, it's certainly easier to raise a child than stay above the brink when you have two incomes supporting that family. but in our poll which is about 3500 people and sampled all across the country, people said that they felt the government should play a role in supporting the families the way they are today. yes, it can play a role in

encouraging people to stay in marriage but more people felt that the government shouldn't look in the rear view mirror, but should deal with families the way they are now. so many of the women that i spoke to, larry, ended up on the brink not because they planned to be there. they might have been in abusive relationships, they might have been left, there's a whole host of reasons women end up on the brink. >> i read this carefully. i'm a follower. >> you read the whole thing? >> i'm a follower and a fan of yours. you went to the trouble to do this and that's a leadership thing that we need. i read a lot of this stuff. you have repeated quotes by women who were interviewed who said they wished they had completed their education. >> correct. >> you just see that again and again and again and i think that's so important. look, this may surprise you, but here's the thought i have. okay. you're going to see the president tomorrow from what i've gathered. is that true? >> yes, that's true. >> you know what i think? i'm not a supporter of president obama, most of his policies, but, but, but, but, but, it seems to me this fellow's a good family man. it seems to me he follows the

model we have been talking about. it seems to me he takes care of his two girls and has a great marriage, and so forth and so on. why doesn't he take a leadership position and make what i'm going to call bill cosby type speeches, okay, and go out and talk about the culture of marriage and stability and education and have the kids later? he is uniquely qualified as president, because of his own example, maria. this is an area where i wish he would do it and a guy like me, i would support him to the hilt. >> well, i think that he is talking about economic mobility. he is talking about family structure. and i think, larry, as you have said, there is all different kinds of families and i don't believe that we get anywhere by shaming people in the situations they're in today. the fact is, half of the babies born to women under 30 are born to single mothers. now, we can talk all we want about marriage and i'm a proponent of it. i think it's important to strengthen it but it's also

important to support women where they're at, support families where they are. and i think education, as you said, is a very important thing to stress. i think also financial literacy is a very important thing to stress. healthy relationships, what do they look like, what do they feel like. >> that's the key. that's the key. healthy relationships and marriage. marriage, marriage, marriage, marriage. >> it's not necessarily marriage. i respectfully disagree. i think marriage is important, but as you said, a healthy relationship is really important. >> i'll concede that point. >> many people don't know what a healthy relationship looks or feels like. >> what happened to the men? here's a question -- >> the men are critical to this. >> where are the fathers, okay? out of wedlock marriages have fathers. what happened to them? it's amazing, if you look at the labor market participation rate, the men are leaving the labor force. i'm not sure i know why, maria. maybe they're taking government benefits, maybe they're doing god knows what.

all i know is they have an obligation even if they're not married, it seems to me, to help out. it takes two to have a child. i don't know where the fathers are in this game. >> well, the fathers are all different places and we have to encourage fathers to get involved in their children's lives, in their daughters' lives and in their sons' lives. we really try to address that in the shriver report. how do we bring men into the equation. we have some really good reporting in there, saying men want to be involved, they have to be invited in because they very often feel shamed, they feel like they haven't kept up their part of the bargain. they often feel that women want them only for providing. what the women said to us is that we want them for the time, we want them to spend time. i think men don't really realize how important particularly in young girls' lives that they are. that can make a huge difference to a daughter's self-esteem, to how she feels about men in particular. >> right. you need examples and responsibility and character and all that stuff that we all know about. i tell you, maria, look, you

tell obama, tell president obama he is a role model. i really mean this. i'm dead serious. he sets an example. he should talk more about this. not social mobility. social mobility, tax the rich, i'm not into that, as you probably know. but this, he could really make a great contribution. that's all i'll say. anyway, thank you for your work. thank you for your leadership. good luck tomorrow with the president. i appreciate you coming on the show. >> thank you, larry. many, many thanks to maria shriver. now, the obama administration's big government poverty solution seems to be to raise the minimum wage and extend unemployment insurance. in other words, more government dependence. that i think is not the answer. however, in a "wall street journal" op-ed today, former white house press secretary ari fleischer suggested there's a better approach. address the breakdown of the family or the so-called marriage inequality. i was talking to maria shriver about that. let's get some more input of the terribly important subject. here is kathy rouss, senior

fellow at the family research counsel and former spokesperson for the u.s. catholic bishops and p.j. o'rourke, author of the new book "baby boom, how it got that way and it wasn't my fault and i'll never do it again." it wasn't my fault, i will never do it again, p.j., we are all wiser, supposedly, as maturing baby boomers. what do you think about that? what do you think about the conversation with maria shriver? where should we be going to deal with this female poverty problem? >> well, i'm with the kudlow plan. it's got -- there is some backup there. the great sociologist charles murray did a lot of studies on this and basically what he found was that people who went as far in school as they were capable of going, you know, which is certainly these days a high school education, and who got married and stayed married, and who got employed and to the best of their ability to do so, stayed employed. i mean, may have gone through

brief periods of unemployment but took a job, kept a job for as long as possible. when you examine that group of people, as much education as you can stand, married and stay married and work as much as you can, you don't find any poverty. >> that's it. you're right. >> you may not be rich. they may not be rich. they may be scraping along but you don't find any poverty. >> families headed by two married parents, kathy, 7.5% poverty rate. that's it. families headed by a single mother, 33.9%. when you get into the specifics demographics, whites, hispanics, african-americans, those numbers are huge. you know, 40 years ago, before the war on poverty started, this poverty rate was down around 6% or 7% for the married family. this is all new. the breakup of the family and the rise of poverty. what should we do about it? >> it is all new. but when you look at the societal indicators,

marriage improves everything. my colleague pat fagan has a paper, 165 reasons to marry. reducing poverty and improving your financial health is only one. it's a very important part of the equation. but improved happiness, longevity, improved health, a decline or decrease in the negative social indicators like drug addiction and dropout rate and so forth. everything improves with marriage. here's the thing. here's kind of a fun fact for you. we were talking about education, too. the national marriage project at uva discovered that when you raise a child in an intact two-parent married household, you increase the chances that that child won't be in poverty by two and a half times what you would do if you gave the mother four more years of education. so there's an out-balance. marriage gives you so much more benefits in terms of raising that child. >> p.j. -- kathy, you know, my wife says exactly the same

thing. about all those benefits of marriage. >> 165. >> let me ask you, p.j. maria shriver makes what i think is an important point. she doesn't disagree with the culture of marriage and so forth, but she's saying look, i read it in her report, all right, we would prefer this solution, what you and i, what we're all talking about. i'll just call it the cultural solution. but if you don't, if you don't, you got to deal with the world as it is, not as you want it to be. so if you have these single mothers and you have these dependent children and you have this grim outlook of poverty, which is what the statistics show, what do you do, p.j., from here going forward? what would you recommend? >> it's painful. it's totally painful because true, we have to deal with the situation that we have, but if we're going to keep paying people to misbehave and that's what a lot of government benefits are is paying people to make bad life choices, we're not

paying them much, mind you. i'm not talking about welfare queens here or anybody cheating on welfare. i'm just saying that the government benefit pays you to make bad choices. and the incentive is maybe tiny, but the effect is huge. we have to get rid of that government incentive for people to make bad choices. >> paul ryan, kathy, paul ryan today apparently, i just have the news clip, he walks through this poverty trap issue and he says look, if you're making $10,000 a year and you're lucky enough to get it up to $40,000 a year, you are going to pay much higher tax rates and you lose government benefits so that your new marginal tax rate may be as high as 80% and you only take home 20 cents on the dollar. that is a disincentive to go back to work. obamacare i think favors singles over marrieds. >> it does. >> the child credit, you know, the child tax credit, you don't

have to be married to get the child tax credit. all these things, the marriage deduction, there are economic policy changes that we could use that would help this story. >> yeah. we have to get government out of the way in terms of getting rid of all the disincentives, all the penalties. that has to be wiped out at every level. it seems like it's cropping up ever more. obamacare is a really good example. there's a terrible penalty for married people under obamacare and it's got to be cane out of there. it's awful. government can't do everything. you can't turn to government for love and marriage. it's a cultural decline of marriage and the culture has to come and help marriage -- >> if i do the right thing, if there's a father who has been a deadbeat dad, i don't know where the men have gone. the statistics here are just awful. but if they were to do the right thing and they wanted to come back to work, whether they get together with the family or not, at least they can have relations as maria shriver said, they could help shoulder some of the burden. we need to provide economic

incentive, not disincentive. we need to say we will make it easier for you on benefits and on taxes. anyway, that's the subject of a much longer segment. thanks very much, kathy, p.j. good luck on the book. >> always glad to be here. >> the new book, "the baby boom" is available right now. you can see it on the screen. everybody go out and buy it. let's shift gears. the fracing boom is boosting the u.s. economy, creating thousands of jobs in a whole bunch of states. but new york, not one of them. governor cuomo still won't make a decision about allowing frac'ing in his state. we will hear from the national petroleum institute about why it decided to go after cuomo and blast him. later, we have been waiting to find out who exactly is signing up for obamacare plans and how old they are. just a few hours ago, team obama released that information and it wasn't good. not near enough enrollment overall and way too few young and healthy signees. this means we are getting closer

t to a federal bailout for insurance companies. even the "new york times" and a.p. and reuters are not being fooled by the white house happy talk. we will take a closer look. as always, don't forget, free market capitalism is the best path to prosperity. i think cultural issue we raised about marriage and responsibility and character and by the way, it's never too late to reform. i'm kudlow. we'll be right back.

that it's given me time toabout reflect on some of life'seen biggest questions. like, if you could save hundreds on car insurance by making one simple call, why wouldn't you make that call? see, the only thing i can think of is that you can't get any... bars. ah, that's better.

it's a beautiful view. i just knew from the get-go that i was... flat out getting a good deal.

when you're ready to buy a car, save time, save money, and never overpay. visit truecar.com welcome back to "the kudlow report." so new york governor andrew cuomo is being blasted for keeping the red light on fracing in his own state. american petroleum institute president jack gerard told the "new york post" his refusal to permit the drilling, i quote, short-sighted and damaging to new york's economic development. what's holding it up? here is karen moreau from the new york state petroleum council. that could be a very lonely job, new york state petroleum council. let me ask you, we are all waiting for andrew cuomo to say something on this, one way or the other. let me ask you, why did jack and you, why are you the american petroleum institute, choosing

now to blast cuomo? why the timing now? >> our industry has been waiting now for andrew cuomo for the last three years to make a decision on fracing. we were told almost a year ago, larry, that a report was coming out, and then at the last minute, that was pulled and we were told the health commissioner was going to review things and it would be just a few more weeks. larry, that was a year ago. nothing has happened since then. there has been no interaction with the administration. attempts by our industry to have the governor tour fracing sites in pennsylvania have been rebuffed. we don't even get a response. this is a state that is supposed to be open for business. >> yeah, you're right. those are the ads. you're exactly right. so as i understand it, just looking down the list, the epa has signed on to fracing. they say it's healthy. the epa has said that. the department of energy has made favorable statements.

in fact, the new energy secretary has been very favorable towards fracing. the department of the interior is in favor of this. they are all waiting on the new york state department of health, okay. so what are they waiting for? if the feds are saying this, federal agencies, why can't the new york state agency, or is it just political, karen? just political? >> it has to be just political. our health commissioner when interviewed is saying that he's not going to disclose what he's been doing for the last year. he's not telling us, he's not telling the public. and in the meantime, thousands and thousands of landowners in the southern tier of new york are suffering. they have wealth under the ground. their farms are in foreclosure. we have the highest poverty rates in some of the upstate cities in new york across the nation. and this fracing boom could happen here, 25,000 jobs by dec's own estimates. it's not happening because of

the governor. >> literally, you go 100 feet from new york into pennsylvania, pennsylvania's a fracing miracle. millionaires are being created, hundred thousand dollar jobs being created, cheap energy is being created. they're happy as a clam. i don't get that. it's not like new york is different from pennsylvania. in fact, as i understand it, some of the wells in pennsylvania, they're going down, they frac and then they go horizontally underground, they are taking new york's natural gas. they are literally stealing new york's natural gas by going underground. now, let me ask you this. political, robert f. kennedy jr., leading the charge against this, okay, despite all the data and all the studies, mr. kennedy will not relent. is that what cuomo is worried about? kennedy and the money and the advertisements against fracing? >> kennedy and the new york city radical environmental groups.

new york city based. have found this to be a great fund-raiser for their organizations. five or six years ago, bobby kennedy was supporting natural gas, but when they realized that this was going to be a boom and that it was going to put their investments in solar and wind on the back burner, they changed their tune. so that's what this is all about. this is not about the science. it's not about the technology. it's pure politics. >> just funny thing, i did not know this. you're saying five years ago, robert f. kennedy jr. was in favor of natural gas? i did not know that. >> yes. if you look at, you know, you go back to the websites of some of these groups that he represents, they were supporting natural gas as the bridge fuel to solar. and wind. and when they realized we had this abundant supply, you know, their tune changed. >> so he pulled back because he will never get his dream of wind mills but they won't allow wind mills in nantucket when they go

on vacation. all right. karen moreau, american petroleum institute, thanks. good luck. knives are out, you know that, the knives are out for new jersey governor chris christie but is it hurting him in the opinion polls? we have a live report on the latest in the so-called bridgegate story next up on kudlow. ♪ ♪ stacy's mom has got it goin' on ♪ ♪ stacy's mom has got it goin' on ♪ ♪ stacy's mom has got it goin' on ♪

[ male announcer ] the beautifully practical and practically beautiful cadillac srx. lease this 2014 cadillac srx for around $319 a month with premuim care maintenance included. ♪ those little cialis tadalafil for daily use helps you be ready anytime the moment is right. cialis is also the only daily ed tablet approved to treat symptoms of bph, like needing to go frequently. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, get medical help right away for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or any allergic reactions like rash, hives, swelling of the lips, tongue or throat, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a free 30-tablet trial.

if you have a business idea, we have a personalized legal solution that's right for you. with easy step-by-step guidance, we're here to help you turn your dream into a reality. start your business today with legalzoom. another mayor says he was retaliated against for not endorsing chris christie. there's a new investigation,

this one about the governor's appearing in a tv ad for sandy relief. eamon javers joins us to explore the details. >> it's been a very tough couple of days for governor chris christie in new jersey following up on revelations in a document dump on friday night. the drip, drip, drip continues as you say now some democratic politicians in new jersey now questioning whether or not they have been subjected to a pattern of retribution by the governor as well, and also now we have an audit that's being done by officials here in washington at hud as to just how the state of new jersey under christie's leadership spent money on a television ad after hurricane sandy designed to spur tourism. go back to the jersey shore. but the television ad featured chris christie prominently, also members of his family. now there are some questions about whether the state appropriately spent money on that. all of this very tough politically for chris christie, but when you look at the poll numbers at least so far, he seems to be holding up.

take a look at this latest poll number from pew. a view of chris christie has become less favorable, 16% say less favorable. 6% say more favorable. 60%, that's the key there, say unchanged and only 18% here say that they don't know whether their opinion of christie has changed or not. if he can hold on to that 60% unchanged figure, that will do him some political good here and he might be able to weather this storm over the coming days and weeks. also, larry, i should tell you, meanwhile here in washington, we've got new news later this hour, we are expecting to see a $1 trillion spending bill introduced up on capitol hill. the bill is expected to be filed at 8:00 p.m. it's going to ease some of the across the board sequester spending cuts, increasing spending on domestic and military programs during 2014 by $45 billion. that's coming up just later this hour. >> all right. that's very important. there's not going to be any shutdown. actually, that appropriations bill is very close to the murray/ryan compromise.

you're in good shape there. just going back to christie. that poll you cited is very important, particularly that 60% number. he won by about 60% and it was only a month or two back. you know what, i'm just going to -- if there's no smoking gun regarding the fort lee lane closing, then i think this goes away. it may take a couple months. unless there's a smoking -- these democratic mayors and assemblymen can whine as much as they want. but if they don't have a smoking gun that shows the governor knew and is not telling the truth, then nothing's going to happen. >> i think politically, that's probably right, larry. but the other danger, the smoking gun danger is definitely there. then there's always the danger of something else. we saw that the assembly in new jersey today announcing it will create a so-called super committee to look into chris christie and these allegations. you never know when these investigative committees start going and churning and pulling in documents and interviewing witnesses, what it is that they're going to find. remember, the whole monica lewinski scandal came out of

something else entirely for president clinton. these investigations take on a life of their own. there's the question mark danger for chris christie as well as the danger of some proof coming out that he did not tell the truth or was not forthcoming in that news conference we saw last week. >> i just find myself agreeing with rudy giuliani over the weekend. i don't think the governor would have said what he said at that dramatic two-hour news conference unless he was absolutely certain. but you're right. there is downside risks here there. are loopholes. i appreciate it. eamon, thank you so much. there is no way to spin this. the obamacare demographic numbers released by the administration late today are just ugly. only 24% of the enrollees are ages 18 to 34. that could mean insurance company bailouts may be necessary. even the "new york times" and the a.p. and reuters are playing this report negatively. we will take a closer look at a possible obamacare death spiral next up on "the kudlow report." so i c

an reach ally bank 24/7, but there are no branches? 24/7. i'm sorry, i'm just really reluctant to try new things. really? what's wrong with trying new things? look! mommy's new vacuum! (cat screech) you feel that in your muscles? i do... drink water. it's a long story. well, not having branches let's us give you great rates and service.

i'd like that. a new way to bank. a better way to save. ally bank. your money needs an ally. i'm bethand i'm michelle. and we own the paper cottage. it's a stationery and gifts store. anything we purchase for the paper cottage goes on our ink card. so you can manage your business expenses and access them online instantly with the game changing app from ink. we didn't get into business to spend time managing receipts, that's why we have ink.

we lik i just knew from the get-go that i was... flat out getting a good deal. when you're ready to buy a car, save time, save money, and never overpay. visit truecar.com welcome back to "the kudlow report." i'm morgan brennan. today we received some much anticipated national demographic data on obamacare enrollments. the grand total is 2.2 million. that's how many people signed up for insurance through either the

state or federal exchanges but not all of those people have paid. now, looking deeper, only 24% of those people are between 18 and 34 years old. the administration predicted 40%. this could be a problem, larry, because obamacare needs these young and presumably healthy people to pay for the elderly and the sick. back to you. >> indeed they do. many thanks, morgan. so let's dig in. what do those numbers mean for insurers and by the way, are there implications for a potential federal bailout? that's an issue coming around the bend. here to discuss, dr. scott gottlieb from the american enterprise institute. what do you make of these numbers? >> they're really bad no matter how you cut it. they track closely the state's data. six states were putting out demographic data. actually, the demographic trends that we saw in those six states track pretty closely these federal numbers. so we know they're a good proxy. the bigger issue for the administration right now isn't just the mix, the age mix of the people entering obamacare, but

the fact that they need to get to about 20 million people to have a viable market here. they need a much bigger pool. they are not on pace to get anywhere close to that. probably they will get to four, maybe five million people this year but the issue is, this just isn't an attractive insurance product. what we're seeing is a lot of the customers, the middle class customers who might have bought obamacare who are dropping individual policies are now paying more to stay out of obamacare. unless they can get those people to want to buy this product, they are going to have a problem getting to that 20 million which is where they need to go. >> scott, what does this do -- there's a related issue, we talked about this, i want to raise it again. the mix is unfavorable to the insurance companies. the mix of young, healthy versus old and sicker. they may get into some trouble. you know more about this than i do. but they certainly would rather not have to pay all those claims without getting revenues in from premiums from the young crowd. now, here's the point. the government stands ready to back the insurance companies, as i understand it. there's a reinsurance fund and there is also a risk corridor

and without going into details, it just means the government will back up the insurance companies with cash, if need be. let me just ask you. will the insurance companies need spare cash? >> the insurance companies are going to end up tapping that reinsurance fund and the federal government will end up paying out more because of the risk corridors, basically the reinsurance program, the government will end up picking up some of that cost. there's no question about that right now. >> well, if there's no question, how is this going to play? in other words, what's the explanation going to be? the insurance companies, you know, not wildly popular in the first place, but more to the point, financial bailouts are wildly unpopular. >> yeah, look, it's not going to play well. we saw an announcement from humana this week that they are going to take -- they are taking an earnings hit because of the bad risk in obamacare. basically they had increased enrollment in medicare advantage plans and those in traditional revenues, the additional earnings they would have earned off that is going to be fully offset by the bad mix in obamacare. i think we will see muore such

announcements but the plans won't take as big a hit because a lot of this will be borne by the federal government. the other thing that will happen is the insurance companies will have to reprice the products next year so premiums will go up a little, not as much as you would think because the government is going to pick up some of the losses but the insurance companies are also going to further skinny down the networks and make these plans even more attractive so this is a death spiral of sort insofar as already consumers don't want to buy obamacare and the plans are going to look worse next year than this year. >> employer based plans, let's just go there for a minute. in other words, small groups or large, eventually, as 2014 goes on and people look towards the reimposition of the business mandate which i guess is still on the books, will they not be sending out cancellation slips in the second half of the year, because of the cost? will there not be big changes there? we have kind of forgotten the employer side, with all the emphasis on the individual side. >> right. well, we know small businesses got grandfathered in an extra year so they will start sending

out cancellations notices at the end of this year unless the administration does something to extend the grandfathering. the administration's really caught in a bind because they need those small businesses to drop coverage and force their employees into obamacare to increase the size of this risk pool. remember, what you need isn't young and healthy people because young and healthy people don't pay a lot of premiums. what you need is a lot of healthy 40 year olds. you need to get middle age folks into this pool and that's not what they're getting. the question is what do big businesses do, the big businesses that self-insure. we always expected they would dump their employees into obamacare because quite frankly, it made business sense for them and made sense for their employees if they had a lot of lower wage employees. i would suspect that that's not going to happen as much as it would have just because this is such an unattractive market that employees wouldn't want to go into obamacare. they are probably going to hold off a little more than they would have. >> they may have cost sharing with their employees. let them go out and pick lots of other plans. walgreens done this, whole bunch of others done this. it may be that kind of thing. here's a lump sum of money, go ahead and find your own plan.

that may happen. so they will never go into the obama exchange. >> moving from a defined benefit to a defined contribution, you can budget your health care essentially. the administration did some other things. they are allowing people to extend rollover year over year money on like a flexible spending card. i think that was done as a way to make it more attractive for employers to dump into obamacare because what you can do if you're a large employer is put your employees in obamacare and basically, the money you save, you can split it with them by giving them a flexible spending account card to spend some health care dollars on and the employees now can roll it over. that was one of those 6:00 p.m. announcements the administration made several weeks ago. >> many thanks, doctor. appreciate it very much. now the big corporations have the cash so why aren't they making the long-term investments that create jobs? the answer, uncertainty about taxes and regulation. we have an all-star panel set up to debate business investment next up. it's crucial to the economy. (vo) you are a business pro.

seeker of the sublime. you can separate runway ridiculousness... from fashion that flies off the shelves. and you...rent from national. because only national lets you choose any car in the aisle... and go. and only national is ranked highest in car rental customer satisfaction by j.d. power. (natalie) ooooh, i like your style. (vo) so do we, business pro. so do we. go national. go like a pro. is american business on the brink of an economic boom? some economists say yes. the optimism sparks from record high stock prices, rising real estate, a surge in personal

wealth, lower gasoline and less washington drama for the moment. so are businesses ready to boom their investments in 2014? i'm joined by cnbc contributors bob lutz, and former cnbc contribu contributor -- bob, you know better than anybody, long term investments, whether it's plant, equipment or software, long term five to ten year type investment create a ton of jobs. bob, we haven't seen that in this recovery. arguably, business investment has been the weakest part of this recovery for five years. is that going to change? >> i really do believe because there was a profound shock in the '08-09 meltdown. you know what happened to the automobile industry and everybody, i mean, general motors went into the meltdown with $16 billion worth of cash which everybody thought was plenty and it turned out to be nowhere near enough.

so there was a caution, let's wait the see what happens, let's accumulate cash, let's be careful not to expand capacity, let's be careful not to overinvest. i think at some point all that accumulation of cash is basically nonproductive. at some point, the shareholders want to see that invested so that money goes to work and creates shareholder value. i spent all day today at the detroit auto show and i've got to tell you, the mood there, let's face it, the automobile industry is still the prime manufacturing economic mover of american industry. the mood there was very upbeat and i really do believe that we're entering a period where business is going to invest. >> jimmy, i mean, bob is right. the car sector is doing very well. but the issue here is will the big car makers produce enough inventory to sell to consumers,

or will they invest in long term plant and equipment and factories and what you call long-lived assets. i don't know. what's going to happen to the companies with tax reform, for example? what's going to happen to the companies with depreciation rates? you got a president that wants to take them out of their high. how many of these companies parked a lot of that cash overseas in order to avoid taxation and don't want to put it back in the u.s.? in other words, this so-called investment boom is not a layup to me. >> there is all that cash sitting overseas, all that cash sitting overseas and to stick with cars for a second, lot of old cars on the roads, we have a lot of old plants and equipment, very old, historically that needs to be updated. that's another big plus. i think what you're not going to get, i think the basis of the pro-business investment, pro-gdp case for 2014 is washington is a neutral. no tax increases but also no corporate tax cuts, no debt

ceiling crisis. so if you get neutral from washington, i think it's a go for the business investment case. >> it's neutral but it's stable. and it's been stable for the last two or three years. the regulation, you know, fuel economy and all the other regulations that have come down, they're here now. and they've been absorbed and people are planning for them and they're investing for them, yet the profitability is there and the cash is accumulating. the american market i think is very sound. there's a lot of demand out there. consumer confidence is okay and i think we will see a lot of investment in capacity, in facility renewal, in new product programs, in all manufacturing sectors. so i think boom is the wrong word, because boom has the feeling of, you know, a steep rise that ultimately is its own enemy. but i do believe we are going to see accelerated business

investment in the united states. >> if we don't, if this thing falls apart, it's not because there's a debt ceiling crisis. it just doesn't happen. the people out there like larry summers have been talking about this secular stagnation thesis. those people are going to have a little wind at their back. we have to start looking at that scenario because it really should happen this year. >> the question, my last question, suppose gm and ford decide they want to build new plants. all right, fine. will they build those plants in america? will they build them here? that's a big issue. will they be treated hospitably by the tax and regulatory regime? this is an anti-business administration. they have been quiescent lately as bob suggests but there's a state of the union speech coming and i'm telling you, it is going to be all about income inequality, it's going to be a barn burner, it will be anti-success, it will be anti-business, it will be anti-fat cats. god knows what's going to happen. ceos take a look at that, they run for the hills.

they take long vacations in asia. >> it's not going to be a pivot? that's not going to be a pivot to the center speech? is that what you're saying? >> the difference between 190,000 jobs a month which is kind of where we're averaged for a couple years, and 350,000 jobs a month which is what we really need is long-term business investment. that's what's missing from this recovery. i hope it happens but i'm skeptical. >> well, we all should be skeptical. but let's face it, it's been quite a long time since 2008-2009. i think the fear and the paranoia about a double dip and this horrible administration, i think that fear is abating somewhat and don't forget, you've got the pressure of all of that cash piling up and shareholders don't like to see a company that is sitting on a

pile of cash as opposed to investing it. i would point out that, you know, especially the american automobile industry and its supply base has been, over the last two or three years, and will continue to invest in new plant and equipment because the demand is definitely up. >> in the u.s. that's the key question. in the usa. >> well, of course, because look -- >> i got to jump. we'll talk about this some more. bob, the night of the state of the union speech, i'm going to e-mail you. >> okay. please do. >> e-mail me, too. >> thank you both. now let's get back to the big sell-off on wall street today. "fast money's" john najarian about to make his return to the "the kudlow report" to tell us what's going on. stay with us. start the engine... and shift through all eight speeds of a transmission connected to more standard horsepower than its german competitors. and that is the moment that driving the lexus gs will shift your perception. this is the pursuit of perfection.

[ male announcer ] we could say a lot

about the most track-tested is ever...

a sea of red on wall street. the dow drops nearly 200 points. the s&p 500 sells off 24 points. oh, by the way, tokyo opened down almost 2.5%. that at the top of this hour. is it the correct pause that refreshes? should investors stay the course? let's ask john najarian, co-founder of monster option. thanks for giving us your time. we have to go lightning round. i just want to ask you, is this correction healthy and overdue? >> yeah, it's both, larry. you know, i think those that didn't have any hedge on today,

the vix moved better than 10%. the market dropped 1%. so you don't have to have a one-on-one hedge on to be hedged. if you had just 10% of your portfolio exposure hedged with the vix, you didn't lose money today. i think that's one of the messages, is that those that don't have protection are the ones that panic. >> what are you looking at? what do you like here? there is stuff that you like and dislike. let's go to your likes. >> well, i mean, right now as far as buys, i like energy, larry. i like vanguard and i like atlas. i like both of these two and if you take a look at the graphs, they are going from lower left to upper right. that's a positive. i think that will continue, larry. the ones that i think are also doing very well, airlines and very discretionary stocks, the casinos. take a look at wynn, mgm and lvs. over the last five days, all of

these are up. one of those is up double digits. it's been a heck of a run. airlines, even with all the cancellations still doing well. all the doomsayers, i don't think they have enough evidence. >> i think commercial business is pretty good. what don't you like? give us a little warning on what you do not like. >> sure. i think based on what target keeps leaking out every day, and they're not the one that's been hit the hardest, but the retailers. everything from sears' holdings to bonton. take a look at how they performed the last five days. there are several stocks in that group down several digits, several others down just less than 10%. that and kohl stocks. you mentioned the state of the union, you know coal will not be positive in the state of the union. i would stay away from that until after the state of the union. >> yeah. coal will not be positive. i don't know what's going to be positive coming out of state of the union. >> probably solar. >> yeah, yeah, yeah. sick of that. rates went down today, real quick, interest rates went down

but stocks went down, too. higher rates are coming. higher rates are coming. i'm telling you. higher rates are coming. it's going to be bullish. >> but later in the year. not right away. >> all right. good point. fair enough. john najarian, thank you, buddy. great stuff. that's it for this evening's show. thanks for watching. see if we get our business boom or not and if we do, interest rates are going up. i'm larry kudlow. see you tomorrow night. [ male announcer ] legalzoom has helped start over 1 million businesses. if you have a business idea, we have a personalized legal solution that's right for you. with easy step-by-step guidance, we're here to help you turn your dream into a reality. start your business today with legalzoom.

we're here to help you turn your dream into a reality. so i can reach ally bank 24/7, but there ar24/7.branches? i'm sorry, i'm just really reluctant to try new things. really? what's wrong with trying new things? look! mommy's new vacuum! (cat screech) you feel that in your muscles? i do... drink water. it's a long story. well, not having branches let's us give you great rates and service. i'd like that. a new way to bank. a better way to save. ally bank. your money needs an ally. see, i knew testosterone could affect sex drive, but not energy or even my mood. that's when i talked with my doctor. he gave me some blood tests... showed it was low t. that's it. it was a number. [ male announcer ] today, men with low t have androgel 1.62% testosterone gel. the #1 prescribed topical testosterone replacement therapy increases testosterone when used daily.

women and children should avoid contact with application sites. discontinue androgel and call your doctor if you see unexpected signs of early puberty in a child, or signs in a woman, which may include changes in body hair or a large increase in acne, possibly due to accidental exposure. men with breast cancer or who have or might have prostate cancer, and women who are or may become pregnant or are breast-feeding, should not use androgel. serious side effects include worsening of an enlarged prostate, possible increased risk of prostate cancer, lower sperm count, swelling of ankles, feet, or body, enlarged or painful breasts, problems breathing during sleep, and blood clots in the legs. tell your doctor about your medical conditions and medications, especially insulin, corticosteroids, or medicines to decrease blood clotting. in a clinical study, over 80% of treated men had their t levels restored to normal. talk to your doctor about all your symptoms. get the blood tests. change your number. turn it up. androgel 1.62%.

>> narrator: in this episode of "american greed"... stefan wilson says his investment fund is a surefire winner. >> you either work for your money, or your money works for you. >> narrator: investors even mortgage their homes to join his fund. >> he would encourage them to, as he said, unlock the dead equity in their homes. >> narrator: but investing with wilson comes at a very high price. >> it absolutely killed my grandmother. she was crying about this when her heart burst and she died. >> narrator: but first, larry salander is one of the biggest names in new york's art world. >> he was a big deal. people would look at him and say, "that's a really successful dealer." >> narrator: but collectors see red when he swipes more than $100 million from their pockets.