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Your Money

Your Investments and the Financial Markets; How You Spend Your Money and the Economy; Politics In and Outside the Office; Rebate Checks Almost in the Mail

Aired February 10, 2008 - 15:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

(NEWSBREAK)
CHRISTINE ROMANS, CNN HOST: Welcome to YOUR MONEY. Where we look at how the news from the week affects your wallet. I'm Christine Romans.

RICK SANCHEZ, CNN HOST: I'm Rick Sanchez in for Ali Velshi.

Coming up on today's program. All right you've got your investments, over here for retirement right, and then you have to put some away for your kids because you are worried about their college education. But suddenly the markets goes not so.

ROMANS: Also ahead, the connection between how you are spending your cash and where the economy is headed.

SANCHEZ: Also, aiding Hillary (INAUDIBLE), blaming Obama or hurting the Huckster that would be Mr. Huckabee of course. For those of you from Arkansas. Criticize all you want, but should you do this at work. This is what a lot of Americans are thinking about.

ROMANS: It is often politics and politics in the office. We will talk about that.

But first, the check is in the mail, just about. Despite some partisan wrangling Congress approved a $179 billion stimulus plan designed to boost the struggling economy by sending one time rebate checks to more than 100 million Americans. You could be one of them. The plan breaks out as follows.

Up to $600 as head of the individuals making up to $75,000 a year. In addition parents will get $300 per child; joint filing couples earning less than $150,000 will receive up to $1,200. Seniors living off Social Security and disabled Veterans are also eligible for this rebate.

SANCHEZ: That is huge news. And so is this week. For more of a political front. The week also saw a not so decisive Super Tuesday primary. Democrats, Barack Obama and Hillary Clinton made it to the 7th inning stretch. Guess what? The score is tie. The Republicans the last business man standing, Governor Mitt Romney is out, that leaves Senator John McCain as a front runner with all the momentum and the possible nomination.

ROMANS: What does all this mean for your wallet and your money? The end perhaps of President Bush's tax cuts at least according to our next guest Daniel Gross, senior editor on "News Week." He joins us now. With McCain now clearly the front runner and Romney the last business man standing out. Does it mean the end to the Bush tax cuts?

DANIEL GROSS, SENIOR EDITOR, "NEWSWEEK:" Well it means the end for two reasons. One is the reality of the budget situation. You know these tax cuts were designed to be temporary and to expire in 2010. Perfect because the cost in the years beyond 2010 are really emens (ph). We've got a spiraling budget deficit, a stimulus package, whoever is in control of the budget process in 2009 which is coming upon us pretty quickly. It is going to be facing a situation where they are either looking at gigantic deficits on the one hand or trying to continue some portions of those on the other hand.

SANCHEZ: Why is it important you know, we talk about the last business man standing. I suppose there is some real calculations to that. But why does it matter whether a person is a business person or not in an economy? I mean because what we got left Barack Obama, Hillary Clinton, the Huckster, Mr. Huckabee and McCain, none of those guys are real business men.

ROMANS: And George Bush was the NBA president lets not forget, the first president with and NBA.

SANCHEZ: And the economy has been disastrous.

GROSS: Well it hasn't been disastrous this whole time. This is a fascination process where by the voters have kind of weaning out all the people with executive experience. You had a governor of Arkansas; you had Giuliani who engineered a tremendous term out of New York City.

You had Romney who is a turned around artist in the private sector. You would think that with the economy facing some issues, some really big picture structural problems that you would want that kind of person or that kind of person would have a real advantage. Instead we are basically left with three senators, McCain, Hillary and Obama.

SANCHEZ: Why is that bad?

GROSS: Neither of them have any executive experience, neither of them really has any private sector experience. And I think there is a presumption that if the primary challenges that you face are economic, if you are talking about managing some macro economic structure, that you want somebody in there who has had some experience doing that. And Precedent Clinton in 1992 even though he was a governor from a small state to get up and talk about how manufacturing jobs had increase in Arkansas, we did all this with taxes.

SANCHEZ: Doesn't have a lot to do with people you have around you? I mean Mr. Clinton had some wonderful real smart people handling his economy, didn't he?

GROSS: He had some good advice. But during the campaign it wasn't clear that Robert Ruben was going to be this brilliant adviser, etc. But I think when people present themselves and when we are facing a situation where very quickly it is gone from being an election about foreign policy in Iraq to being an election about how are you going to be able handle the housing, the sub prime, are we in a recession, if so what should we do about it?

And America is kind of standing in the global economy is changing, you would think that people would be looking for some sort of inspiration or really a plan on OK we are in this mess, here is how we are going to get out of it.

ROMANS: The plan to this point though would have to be on paper, because there are running for office, there are not in Washington and they are not having to build consensus which good or bad depending on how you look at. Who do we think is going to have the plan that is going to lead this economy out of it? Or by the time there is an inauguration will this whole faltering economy could be behind us.

GROSS: A typical recession lasts eight to ten months that is what the last two have lasted.

SANCHEZ: Are we in one by the way?

GROSS: I think we are probably in one; we probably maybe entered it December, January.

So if you play that out, with all the stimulus coming, and then cutting rates some more, cash flooding into consumers pocket books through these rebates. By November or December, by the time next person is getting ready to assume office, the economy is likely to be expanding again. Of course this could linger for awhile, the jobless recovery. Which we have had both in the last two times.

People won't feel that the economy is going that well. But it is most likely that it will be expanding again. There is always a degree that these stimulus efforts and the plans about how will we going to get out of this recession inevitably because of the political process comes too late.

SANCHEZ: This is a fascinating conversation, especially when you get into the politics of what is really going to work. I am left with that thought. We are going to get into this hopefully again sometime. As a businessman, the answer to a business economy, are you better off with someone who is better at government? We will leave it there. We will let you guys at home argue that one amongst yourselves.

ROMANS: Daniel Gross, senior editor at "Newsweek." Thanks so much for joining us.

GROSS: Thank you.

ROMANS: Coming up next, grab a pen and paper, learn how to make sure your savings survives this up and down and down stock market.

(COMMERCIAL BREAK)

SANCHEZ: They have been selling off roller coaster tickets again on Wall Street this week. No kidding, I mean maybe that has you worried. Your kid's college education or your retirement is all going to be derailed bit end of this.

ROMANS: It would of felt like that on Tuesday, Tuesday the Dow plunged 370 points. The stocks really haven't showed many signs of recovery. The Dow is now down more than 7 percent I think this year. That is a pretty rough start. It is time for some advice from our expert friend, Ned Riley; he is the chairman and chief investment strategist at Riley Asset Management. He is going to tell us how to put our long-term investments on track with Exchanged Traded Funds. Ned nice to see you.

NED RILEY, CHAIRMAN, CHIEF INVESTMENT STRATEGIST, RILEY ASSET MANAGEMENT: It's a pleasure to be here.

SANCHEZ: We are going to call Ned Mr. Silver Lining.

ROMANS: Ned, Mr. Silver lining, you like these ETF's, Exchange Traded Funds. You can buy them like a stock. You say, when things are on sale, you have to buy. You can't be dumping out of stocks right now because you have already had the ride down.

RILEY: You have had the ride down. Now, the rationale of reasoning is coming out. Last Tuesday was an announcement by the services industries that they are in recession. People have to accept the fact that recession is upon us.

ROMANS: This is the spiders, they call them the spiders, the Q's, and XLS's those are the three Exchange Traded Funds you recommend. You can buy them just like a stock right? You either call your broker or you go to your brokerage or e-trade account or whatever. These are the S&P 500, the top 100 companies in the Nasdaq and then there is a financial sector ETF in there.

RILEY: Yes, the Spdrs (ph) are the SPYs. It gives you the representation of 500 companies that are in that index and you don't have to worry anymore about Microsoft versus Intel or one drug stock versus another. When you go home at night, you don't have to watch all of these individual stocks, you just have to check what the market did and that's what your portfolio did during the day.

The Q's in the top 100 stocks in the Nasdaq index. They are primarily technology, biotechnology and health care related. They are fast-growing companies. They have been beaten up in the last four to five months, i.e. this QQQ has been under a lot of pressure. I think over a long period of time this particular Exchange Traded Fund is going to return somewhere in the area of 10 to 12 percent. You have high and fast-growing companies in there. I am not promising each year. This is not a guarantee but it gives you a lot of diversification so you are not sticking with one stock.

ROMANS: I get worried about those financials though because.

SANCHEZ: Because they are getting killed.

ROMANS: They have been getting killed. But there is federal investigations into some of these big brokerage firms.

SANCHEZ: Wachovia talk about being in the news right now.

ROMANS: What do we call that, headline risk? You say maybe that is factored in.

RILEY: I think most of it is factored in. Headline risk you are never going to avoid. People are trading for the next hour and not worrying about the next year two or three. You look at Wachovia or a Bank of America or J.P. Morgan; we are talking about companies that have a lot of capital, good liquidity. There are big problems out there. They have all been disclosed. It is now a matter of fixing the problems that exist.

SANCHEZ: There is a social psychological component to this we can't help but talk about. It is not just about money but what's in people's heads. You are saying to people, look, there is some wonderful opportunities out there. This is the time to go out and buy; this is the right time too do it. They are saying, "a," I'm broke or "b," I'm feeling like the country is broke. I'm afraid. How do you get them to take that leap?

RILEY: They are not alone either. Trust me, the professionals I deal with every day, the professional money managers feel that same nervousness, boy, I can't loose much money. The point is, to be successful in investing; you have to swim against the crowd. You can't be a lemming, because you end up jumping off the cliff.

SANCHEZ: Mr. Silver Lining.

ROMANS: Ned Riley, Riley Asset Management. Thanks, Ned.

SANCHEZ: He said tough it out. Coming up after the break. No more suitcases for you. One airline says they will charge you for the second bag. Who is that airline?

ROMANS: I will tell you.

(COMMERCIAL BREAK)

SANCHEZ: We welcome you back talking business and the gang is all hear. This foreclosure situation really is a mess, isn't it? One of the areas worst hit is, would you know, did you know, Cleveland, Ohio. According to the census bureau, they are already saying it is one of the poorest big cities in America period.

ROMANS: They have been saying that actually for a few years, yet mortgage lenders wrote tens of thousands of sub prime loans in a city that was grappling with poverty and an unemployment rate higher than the national average.

(BEGIN VIDEOTAPE)

ROMANS (voice-over): City councilman Anthony Brankatelle (ph) walking through the wreckage of another Cleveland subprime mortgage.

ANTHONY BRANKATELLE (ph), CITY COUNCILMAN: They ended up with a house that gets abandoned, foreclosed, and then stripped. And now all we have left is this wrecking ball.

ROMANS: The city has spent six million dollars tearing down foreclosed homes. Homes abandoned, and stripped of everything of value. Cleveland Mayor Frank Jackson.

MAYOR FRANK JACKSON, CLEVELAND: Just imagine having 50 foreclosures four to five years ago and having almost 8,000 now? You can see the magnitude of it, the intensity of it.

ROMANS: The city is suing 21 banks and financial firms for negligence, over what it says was the way Wall Street bundles and packaged and resold these risky mortgages. Cleveland wants to recoup millions of dollars in lost revenue. The cost of extra police to combat vandals and demolish costs.

Many of the 21 banks have not commented on the case. Citigroup will contest the suit vigorously. J.P. Morgan says it shares the city's concerns over foreclosures and will work with borrows when appropriate to keep them in their home.

There is an overwhelming sense of anger here. City officials say Cleveland was never a suitable place for mortgage lenders pedaling high interest loans to people with poor credit. The Census Bureau caused Cleveland one of America's poorest big cities; the jobless rate of 6.1 percent is higher than the national average. County treasurer Jim Rokakis says he has been warning about lending abuses since 2000 and questioning mortgage lenders motives.

JIM ROKAKIS, CUYAHOGA COUNTY TREASURER: If you knew the economy was weak here, why did you continue to pump mortgage dollars into this economy? Why did you continue to make loans in areas that had already shown really high foreclosure rates? Still waiting for the answer.

ROMANS: He places the blame squarely on an aggressive Wall Street that lacks regulators.

ROKAKIS: The poor folks in America didn't cause a multi trillion dollar crises. Thrust me, that is not who caused this crises.

ROMANS: A crisis that is spreading. Each of these red dots, another foreclosed house. Spreading now well beyond Cleveland's urban center beyond sub prime to adjustable rate prime loans and into the suburbs. Mayor Jackson's advice ...

JACKSON: Prepare, you have to be ready.

(END VIDEO CLIP)

ROMANS: That is a result of another sub prime mortgage in Cleveland. I love the treasurer said a bunch of poor folks in America didn't cause this crisis. He also complained early in the 2000. No one cared but now that this is an international scandal, now, they care about these mortgages.

SANCHEZ: Jennifer is joining us now.

JENNIFER WESTHOVEN, CNN CORRESPONDENT: Yes.

SANCHEZ: We were kidding a little while ago about what's going on. You remember the Seinfeld episode with the soup Nazi. No more soup for you. I understand there is an airline out there that says no more suitcases for you. Do you know who it is, Jennifer?

WESTHOVEN: This week, United became the first American carrier to charge you for something that you bring, a second suitcase. Unless you are one of their elite flyers, the airline says, if you want to check a second bag you are going to have to pay $50 for the round trip domestic flight. No other major domestic airlines have matched this yet. But there are some reports that U.S Airways and Northwest are looking into it.

SANCHEZ: The populous thing to do is to get mad at United Airlines for this. However, you have to admit, when you get on an airline and after only seven people have walked in and they say, sorry, no more storage room, because people like you walk in with five bags.

ROMANS: That's because I have a car seat and a baby bag. Don't be mad at me. People do bring a lot of stuff.

WESTHOVEN: The trouble is if they are going to charge you for that second bag to check it, you're not going to check it. You are going to stuff it in the overhead bin instead. So it is more stuff up there. It is kind of like they are nickel and diming you every way they can.

SANCHEZ: It's going to turn the flight attendants into bag Nazis.

ROMANS: Let's talk about Wachovia.

WESTHOVEN: This is a really shocking story. The "New York Times" is reporting that Wachovia filed this lawsuit over allegations of cooperating with telemarketing fraud. It says in these court papers, the bank basically in internal memos company executives acknowledged that they knew there was something wrong with these telemarketers yet they kept doing business with them for years. So the paper reportedly says that what is happening is Wachovia had these telemarketing accounts. They used these accounts to rip off people, especially the elderly for as much as $400 million.

ROMANS: The charges are that the bank knew this was happening but they kept letting it keep going on?

WESTHOVEN: That's the allegation.

SANCHEZ: They shouldn't be sharing information any way.

WESTHOVEN: The mighty euro is beating up the U.S. dollar. What a way for us to see this right now? Here, in New York City, signs have started appearing in the stores around town saying, we take euros.

ROMANS: You go to Europe and it says, we take dollars, we take dollars.

SANCHEZ: Here is what is going on. A dollar today is as deriled as a McCain supporter at a CPAC convention, talk about not wanting to be there.

WESTHOVEN: You know when you are on a cruise, you go to the little islands and they take your dollars. Apparently, we are a little island.

ROMANS: We are a little, tiny island.

SANCHEZ: This great country with that great currency suddenly is so unimportant.

WESTHOVEN: Real surprising. I have never seen anything like that.

ROMANS: Euros accepted here. Thanks. Coming up, why some of your favorite places to shop are laying people off and shutting down stores. We have that story for you.

SANCHEZ: We will be back.

(COMMERCIAL BREAK)

(NEWSBREAK)

SANCHEZ: We welcome you back to YOUR MONEY.

ROMANS: Grim report out this week, sorry to tell you about consumer spending. Retail sales for January came out the worst showing in some 40 years.

SANCHEZ: Translation, people are buying less stuff. When times get tough, guess which particular stuff people buy less of? You know, right?

ROMANS: What?

SANCHEZ: Clothes, because they figure that's the one thing, I have a closet that's filed with it already. With that nugget in our noggin.

ROMANS: I feel bad about the economy, so I go shopping.

SANCHEZ: Do you really?

ROMANS: No. I am very conservative.

SANCHEZ: Let us now go to fashion week. This fashionable tour is provided by CNNMONEY.com correspondent Poppy Harlow.

(BEGIN VIDEOTAPE)

POPPY HARLOW, CNNMONEY.COM: Massive job cuts at Macy's plummeting sales at Sax, Coach and North Strom, the economic slow down is hitting department stores right where it counts on their bottom line. Inside New York, fashion week is the story of survival of the strongest and hi-end luxury retailers are holding their ground.

SUZANNE KAPNER, "FORTUNE MAGAZINE:" No retailer is recession proof but the high end is in a better position than the middle market chains. For true designers products is the must-have, emotional purchase, they want that new handbag or that new jacket for the spring season, they are going to buy it even if it is thousands of dollars.

MARK LEE, CEO, GUCCI: In a three-year period comparing full year revenues of 2007, the full year of 2004, on a global basis, we have grown the Gucci brand 46 percent.

HARLOW: According to a recent Standard & Poor retail report, interest rate cuts like the ones we have seen recently have historically been favorable to retailers.

MARK AZRIA, FASHION DESIGNER: When the times become hard, the best become better and the worse disappears.

CAROLINA HERRERA, FASHION DESIGNER: A woman who is going to spend some money and she wants to be buying something, one of a kind, something very special, that's what sells most, one that is special.

HARLOW: The weak U.S. dollar isn't dampening spirits under the tents at Bryant Park believe it or not are battered green back is driving sales for those in search of a bargain.

CHANTAL BACON, CO-FOUNDER, BETSEY: In our case, in the domestic market, our business is strong. In terms of the world market, because the dollar is so weak, there is a huge amount of people coming and wanting to buy U.S. things.

BETSEY JOHNSON, FASHION DESIGNER: We just added Coach Jewelry, handbags, shoes, bathing suits, perfume, and watches.

HARLOW: A number of prominent fashion houses have plans to take their companies public this year. Notably Prada. Just last month Tommy Hilfiger delayed his IPO.

KAPNER: I think it is a big question mark whether the IPO's in the fashion world will go forward this year with the rocky stock markets. The problem is fashion companies need capital to compete.

(END VIDEOTAPE)

HARLOW: Some retailers are making money. Keep in mind; these designers depend a lot on celebrities showcasing their designs at award shows. With the Golden Globes all but canceled with no red carpet this year, high end designers will be hit hard if they lose out on this exposure from the academy awards that is coming up later this month.

SANCHEZ: The bottom line is Joe average out there isn't spending a lot of money on new clothing these days.

HARLOW: No.

ROMANS: But the big guys like you still paying $10,000 for a suit.

SANCHEZ: I can't believe you have said that on national television.

ROMANS: You don't pay that much for a suit.

How much does a high-end guy's suit cost?

SANCHEZ: $2000.

ROMANS: We thought Manola (ph) was bad. I haven't bought a pair of those yet. You all know this. If you want to know about how the economy is doing, retail is a pretty good barometer. Not the $10,000 suits and the $500 shoes.

SANCHEZ: So we come to this question, just how bad was January? The worst in 40 years. Ouch. Macy's is going to close some stores, lay off employees. Home Depot is talking about some of the same thing, so is Sears. Britt Beemer is the chairman of America's Research Group which tracks consumer behavior in Orlando, Florida and he is here with this week's cheery retail moves.

ROMANS: You are smiling. Hi, Britt.

BRITT BEEMER, AMERICA'S RESEARCH GROUP: Good afternoon.

SANCHEZ: How do you follow something like that?

BEEMER: I want to say that 24 percent of women still do shop for retail therapy.

ROMANS: 24 percent.

SANCHEZ: Therapy. That's interesting, because that's what Christine just said. When I do get depressed, I like to go to the malls but do they spend money? And is that really the right place to be?

ROMANS: It could save the whole economy, I don't know.

BEEMER: One time 48 percent of women shopped for retail therapy. They could get customer service and now they can't find anybody to help them.

ROMANS: Let me ask you something quickly, we heard from Wal-Mart this week, the people who got those gift cards for the holidays, they are using them on things like diapers and food and staples like that. We heard from some other folks that these gift cards, people are hoarding them and waiting to use them for other things later on in the spring. What is that telling us about the psychology of the American consumer?

BEEMER: I have been dealing with consumers now for over 28 years. The years that I have been doing research, I have never seen the consumer this frugal and saying what they are going to do. Seventy one percent of consumers in the month of January said they would only shop at stores and buy the deals. When the month was over, 71 percent of consumers said they went and shopped the stores that only had the deals. Before, consumers would say that but they didn't do it. Now, they are doing what they planned to do, which is why retailers are struggling so.

ROMANS: Is it because they have to, because they are filling up the tank and they are paying for a mortgage interest rate reset, I mean is it because they don't have any other choice?

SANCHEZ: You know what I think is going on. I think to a certain extent we have gone through the built-it economy and now we are going through the fix-it economy? Am I not right? We are going to see people doing that type of thing, fixing things as opposed to buying things?

BEEMER: I am not sure that is the way it is in the short term, that maybe the way it is next year. But right now, you have 49.6 percent of consumers that are frozen in place either because of debt, credit card bills, higher gas prices or higher heating bills. That's pushed half of America into buying nothing. Only the other half of consumers are shopping at all. We are seeing things for the first time -- last January, 30 percent of consumers said they couldn't buy anything because of those issues. Today, it is almost 50 percent. So that is what effected all the spending in January.

ROMANS: What about the economic stimulus plan? If we get a check in the mail, $300 per kid, are people going to spend those at the Wal- Marts of the world or are they going to save them or use them for new school clothes in the fall? What are they going to do with them?

BEEMER: Well I would say right now, if you look at what happened in 2002 and this year is even more economically oppressed in the area of debts, I think you will see about 20 percent going to retail, about 10 percent to entertainment and food, going out to dinner because they have this extra money. I think you will see 70 percent of the dollars going towards paying off debts or paying off bills. We are not going to see the kind of lift that they want to, because the consumer hasn't got the money to spend.

SANCHEZ: Do you know what the best tell tail sign is? If you happen to go to a mall near your home in January, it's a lonely place out there. I think malls are really getting hammered. Although, you are going to see -- I think I was reading some of Britt's material that was saying the Costcos and places like that will do OK.

ROMANS: Britt Beemer we have to wrap it up there but thank you so much. We really appreciate it. We will talk to you seen. This is not going to go away. Thanks, Britt.

SANCHEZ: And you are good. When the going gets tough, the tough get -- there is something you are supposed to do during these tough economic times. I know what the answer is because I did my research last night before going to bed. You are going to find out as well right after the break. Stay with us. (COMMERCIAL BREAK)

ROMANS: We are talking negative savings rate, we have been piling up the debt, and you know buying houses that were to big for us and pulling money out of the houses.

SANCHEZ: Let's not forget about a trillion dollars in Iraq.

ROMANS: Oh yeah, there is that and there is trade deficits, credit card deficits. Let's talk about some solutions for once here. Because there is a lot of stuff going around. CNN's "OPEN HOUSE" host Gerri Willis, "AMERICAN MORNING's" Greg Hunter are both here.

I mean Gerri come on is it all as bad as all this?

GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: No, I am here to say the glass is half full.

SANCHEZ: You really are the optimist.

WILLIS: Look, I just feel like we are getting too negative here. The world is not ending. Maybe everything is not the way it should be. At the end of the day, the economy is still moving along, although very slowly. You have to take some of the things you have been talking about, some preventative steps. Being paralyzed by fear that is not the way to go.

SANCHEZ: John McCain has said to the right wingers this week calm down everybody.

ROMANS: But Greg you are still concerned about some of the big picture issues in this economy?

GREG HUNTER, CNN CORRESPONDENT: Still concerned and I'm not alone.

SANCHEZ: Are you willing to use the r word or can you go further and use the z word?

HUNTER: Without question, a recession. The Fed is going to fight and scream to lower rates. We just had a 1 point and a 25 rate lowering. We had a $160 dollar stimulus package. That doesn't include all the injection of liquidity by the Fed. We are down what, 400, 500 points on the Dow.

WILLIS: The stock market, she goes up. The stock market, she goes down. It is going to anticipate the recovery. It will move ahead before the actual economy does. That's one of the big fears here that everybody is going to pull their money out of the market at the wrong time.

HUNTER: The banks are in trouble.

WILLIS: I am not disagreeing on that.

HUNTER: The banks are in big trouble. What is familiar with the banks being in trouble is that is the same thing that happened in the great depression.

WILLIS: The d word.

HUNTER: The banks are in trouble now, Gerri.

ROMANS: They didn't have trillions and trillions of dollars to go to and get a bailout. They have had a 35 billion plus in fusion in the banks right now which either masking all of the problems or it is going to cushion them from the problems.

WILLIS: You know in some ways, let me make this point about the banks. It is up to them to guide us through this. Their purse strings are so tight right now. They have to make liquidity happen for consumers or they will put us in a depression.

SANCHEZ: As the nonbusiness brain in this conversation, isn't this all about us taking our eyes off the price as a nation, not thinking about the little guy, about letting too many big business guys running the government to where all they cared about was their other business cronies.

WILLIS: Where were the regulators?

SANCHEZ: They are eliminated by the big business guys.

ROMANS: What about Cleveland and ground zero for all these foreclosures? The folks there say we have been complaining about this for years, we have complained to federal regulators, state legislators. When their was blood flowing in the streets of Cleveland, no one cared? When blood flowing in Wall Street, suddenly it is in the headlines and they blame everybody.

HUNTER: I want to bring this up, they allowed, the Glass Eagle Act, 1933 kept banks separate from brokerage service.

SANCHEZ: So investing and savings should be two different things.

HUNTER: We are allowed to secure advertise mortgages. Where are we? The banks are in trouble. They have trillions of dollars of big- time trouble.

WILLIS: Part of the solution in the stimulus package will be securitization of jumbos. That's a good thing.

SANCHEZ: Yes or no, you mentioned depression a little while ago. Are you serious?

HUNTER: I think we are headed for bad times.

SANCHEZ: I want the truth.

HUNTER: George Sorrow says the United States is heading ...

ROMANS: Can we go to that? HUNTER: He said we will be using the world reserve currency. Those dollars have to come home when you have a lot of something. The price goes down. It is inflationary. They say it is not a question of how hard or soft we are going to hit but how hard we are going to hit.

SANCHEZ: Greg is a guy who says we have to take our medicine and we might as well be pretty serious about it.

WILLIS: I believe there are a lot of people out there very worried and for good reason.

HUNTER: Big people, people with money.

WILLIS: If you are out there and your are worried about your money, there are steps you should be taking right now.

ROMANS: That's all we can be in charge of, is our own money. We can't be in charge of what they are doing wrong.

Gerri thank you so much. Greg Hunter thank you.

HUNTER: Thank you. Protect yourself at all times.

ROMANS: What are you talking about?

I don't know. Coming up next, on YOUR MONEY office politics, publicly taking sides on the presidential election, this could be a big no-no.

(COMMERCIAL BREAK)

ROMANS: She is talking about the real rules of politics in the office. Political debates everywhere these days. So you might want to tread lightly now when it comes to your favorite candidate. Has anyone come up to you and said who are you voting for?

SANCHEZ: Oh I know, I think most office people know not to because it is something we are not suppose to talk about. By the way you know who I like. Ines Ferre, she is talking about the real rules of politics in the office.

How are you doing?

INES FERRE, CNN CORRESPONDENT: Good. Nice to see you guys. Nice to be back here.

Well, there are some topics that just don't mix with the workplace. Politics is one of them. When you start talking politics in the workplace, you are treading on treacherous ground.

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CHYNTHIA SHAPIRO, AUTHOR: Do you remember our moms would always say no politics at the dinner table. They were right. The reason they told us that is because people have very, very strong feelings about it and very personal feelings about it. It can very quickly lead to arguments. So when you allow yourself to talk about politics in the workplace, you can very easily make secret enemies that you need for your career success.

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FERRE: The important thing is that if you do talk politics in the workplace, don't assume that other people feel the same way that you do and try to keep the conversation short.

SANCHEZ: Here is my take on that. People should be people. If you keep your thoughts to yourself, nobody ever gets a chance to talk about anything. We don't learn from each other. We are already living in an era where kids are constantly playing computer games, everyone is plugged into their TV, and people should talk about what they think even if it is different.

FERRE: I get it. Buy you know what politics is very personal. You are talking about certain values that are very personal to you, like religion. It's a hot topic.

ROMANS: If you are a boss, you probably don't want to be telling what your personal feelings are around your under links, for fear they will feel that is some kind of a message. You might not want to disagree with your boss.

SANCHEZ: Isn't it all about how you say it, as long as you leave room for the other person's feelings and sentiments?

FERRE: Yes, but sometimes maybe your boss doesn't agree with you or your company doesn't agree with what you think. So you have to kind of be political about it. I don't know.

ROMANS: You are the political guy around the office.

SANCHEZ: I am completely incapable of being political about anything.

ROMANS: Rick likes to keep his passion and temper under wraps so he doesn't have to worry about this. Thank you so much Ines.

SANCHEZ: There is a lady in Atlanta who happens to be married to me who would disagree with that. When it comes to making money you can profit from your true fashions. Falling stock prices and talk of recession, a lot of people out there looking for different ways to invest these days.

ROMANS: We found business owner who turned his love of super hero's and monsters into big bucks.

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STEVEN FISHLER, PRESIDENT, METROPOLIS COLLECTIBLES: My names if Steven Fishler, I own a Metropolis Collectables in New York City.

ROMANS (voice-over): Fifty years ago, they sold for loose change. Now, comic books and other vintage collectables are big business.

FISHLER: This is worth about $75,000.

ROMANS: But Fishler didn't just suddenly cash in on this hot trend. It's a life long investment.

FISHLER: I started collecting comic books when I was four or five years old. In the early '80s, I turned it into a business.

ROMANS: It is a business that could be a solid investing alternative to the Wall Street weary.

FISHLER: There are people who may have been burned by the stock market and they feel that they want to diversify; rare comics and vintage movie posters are certainly options for them.

ROMANS: Fishler says some rare blue chip comics have out performed blue ship stocks. The first ever comic book featuring batman sold for 10 cents in 1939, a mint condition copy today is worth $485,000.

FISHLER: This is called our comic vault. There is probably about 200,000 books in this room.

ROMANS: But keep in mind, only a handful of these comic books can fill your bank account faster than a speeding bullet.

FISHLER: If people were to get into the buying and selling and investing in comic books today, I would not suggest to jump into the market. I would take six months to a year to bring yourself up to speed. My secondary advice is buy what you like, buy what you appreciate, and buy what you enjoy. If it turns out to be an investment, so much the better.

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ROMANS: Like all art, buy what you like and what you enjoy. If it becomes an investment, then that's good.

SANCHEZ: Do you know what's going to be big up there?

ROMANS: What?

SANCHEZ: Randy Moss football cards. Especially the rookie cards.

ROMANS: You think so?

SANCHEZ: My son things so. There is a very important date next week that you better not forget. Stick around. Carrie Lee got you covered on this one.

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ROMANS: There is a lot coming up in the week ahead that could affect your wallets. Carrie Lee is going to tell us what we need to pay attention to. Hi Carrie. CARRIE LEE, CNN CORRESPONDENT: Hi Christine, hi Rick. Nice to see you both.

Well first of all, we have the 50th Annual Grammy Awards coming up this Sunday night. So a lot of people looking forward to that and it will be a different situation as we saw with the Golden Globes because the striking writer's guilt has given a temporary reprieve to this event.

According to "Adage Magazine," the strike could be over as early as next week. We will see.

They are coming out with numbers on Tuesday, on February 12th, and analysts expectations are for a loss of 22 to 55 cents a share this compared to a 32 cent gain last year. So to give you a sense of the year over your comparison. Now GM execs are saying they are expecting lower interest rates, the stimulus package, things like that will help sales in the latter half of this year. They did say that sales were up in January. Others have lost ground. And that February is on track. We will see what they have to say.

SANCHEZ: It just makes sense. In an economy like this, a new car is not a necessity. A car is a necessity, not a new car. You are going to be fixing your car, not going out and replacing your car.

ROMANS: Americans somehow seem to find a way to get a new car if they want one. I never count out the American getting a bigger car or a newer car.

SANCHEZ: Because they are Ford tough.

LEE: Here is the interesting thing. GMAC, the company's finance arm, and you know this is usually the cash cow, profitable area, GMAC, lost $724 million in q4 because of their mortgage involvement. You know when that unit is hurting, it is not good.

ROMANS: His wallet is going to be hurt next week by a little holiday that falls next week.

LEE: Don't forget, Thursday, February 14th. Now, this is a brilliant segway. The creator of General Motors put together a company that built the Empire State Building. Why do we care about this? Because 14 couples are getting married on the 80th floor of the Empire State Building on Valentine's Day. They do this every year. They contest, people write in how they met.

SANCHEZ: Which floor?

LEE: The 80th.

So 14 couples, they have been doing this since 1994, Brides.com helping with the planning, fashion, and beauty help. I don't know if it is all free, but pretty cool story right?

SANCHEZ: Good stuff.

ROMANS: Mrs. Sanchez plug in your ears. What are you going to get?

SANCHEZ: I can't do that.

ROMANS: Flowers, the chocolates.

SANCHEZ: I always, flowers, chocolates, the whole nine yards. And lots of gold and lots of diamonds.

Thank you so much for joining us and we will see you again next week. On YOUR MONEY, Ali Velshi will be back next week I understand.

ROMANS: Yes.

SANCHEZ: I will find a reason to come by anyway.

ROMANS: It is very fun when you drop by.

SANCHEZ: You can catch Christine later today at 7:00 p.m. Eastern on "Lou Dobbs the Week."

ROMANS: And always thank you Rick for coming by.

You can see Ali back here next week, Saturday at 1:00, Sunday at 3:00. Those are our times. See you then, "BALLOT BOWL" starts right now on CNN.

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