This week we had another week of record highs and yet weve got those worries about coronavirus among other things slide down what has been a very strong backdrop. I would say it is never been more difficult that is right now and taking direction, trying to stocks, for 2020 and beyond. A lot of individual investors are confused they dont how to analyze the virus and how lethal it is going to be. So those things are distracting people from looking at a longerterm horizon. Speed seven there is also an issue, please see distractions and supply chain, parts shortages, component shortages, doesnt that impact earnings . It does but it would be temporary. It is just a temporary setback. It is not a monumental shift in the way the economy is going as if some new technology emerged that wipes out all of the other existing technology. So keeping in perspective its just a shortterm, its very sensitive to the lethality of the virus but from an Economic Perspective maybe we have one or two quarters where the ceos do comment on the impacts, but is temporary. Maria 3107 increase in retail sales on friday. What does that tell you about where we are in terms of the consumer. Looking at worst next week you wanted be putting new money to work in the market today . I think the consumer is rigidly on a positive track, i think thats a good sign. And i also think that valuations are still reasonable. Not just to buy s p 500s but its a stock pickers market. I know thats a trite phrase but more than ever, you have to look at individual stocks and get a sense of which are the best value. Maria its interesting because up until now this huge rally hasnt built on a couple of technology nays. Microsoft, amazon, alphabet, is that we want to put your money . Or is there a broader area of ideas to look at . I am pretty certain theres a broader area, and that if you focus on just those stocks you are not going to be happy this year as you were last year. And remember, theres a monkeywrench is thrown and all of a sudden we have black rock saying theyre going to divest from fossil fuel manufacturers. Things like that. Consumers are confused as to what the next direction will be and how much that will impact future earnings of companies and whether or not those companies are going to be outoffavor. Maria so whats left customer. I like investing themes. So regardless of the way the economy is going to go and the questions we just discussed, there are certain themes that are endearing. So one of them is Elder Healthcare for instance. If you look at the future and you said what industries are going to be existing and doing very, very well regardless of whats around. One of them is data security, we are all frankly, paranoid about being hank hacked and rightly so. Data security will never go away, data storage, would generate so much material has to be stored. And also Senior Healthcare is a great industry. Vision and hearing for instance are Great Industries to be in. Maria how do you tap into that industry . Which won the last one . Maria yes. You have to study for instance anybody over 70 years old, 50 of people over 70 are going to have cataracts. So you are not going to put off cataract surgery whether or not there are viruses or whether or not the trade laws doesnt follow through, you can invest in companies that care about cataracts. You can invest in companies that care about hearing. People over 75 are going to have hearing issues. Maria is also an election year, what typically happens there had a suppliant things . I dont move the goal post what i do is have a say of these stocks are the stocks i got a long run, and at longrun seems shorter and shorter. But to me its a two or three year horizon. I just push on through that noise, and remember, these themes i mentioned, whoever wins, i dont think it will impact those kinds of themes of investing. Maria does this feel like a Bernie Sanders is gonna win, doesnt that market selloff because hes got Big Government programs, hes got higher taxes, he doesnt want any billionaires in america. Its an interesting chess move because we saw a burning want to New Hampshire, the market actually rallied because i think investors were saying bernie is going to be the candidate, he will be easily defeated by trump, hence we will have status quo. So i am putting my money on that. Maria i think your way think thats why the markets rallied during iowa and New Hampshire. Its great to get your worst perspective. Stay with me my exclusive oneonone with white house limu emu doug [ siren ] give me your hand i can save you. Lots of money with Liberty Mutual we customize your Car Insurance so you only pay for what you need only pay for what you need. 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Maria a welcome back i spoke with white house and National Economic counselor under President Trump larry kudlow about the coronavirus and whether we can expect tax cuts to point out this year. Watch. Maria at such a mixed week in terms of Market Performance and what investors were focused on, whether it be that strong backdrop or the fears of the coronavirus. Give me your assessment on where we are right now in terms of Economic Growth, larry. Look, i think the fundamentals here in the u. S. Are superb. We are in a bluecollar bedroom we are actually in a womans boom and well talk about that later too. We had a huge job numbers a week ago, wages are rising, the low wages are beating the production workers are beating the managers, thats very important. We are seeing a big pickup in housing, maria, that is going to be very important. I dont know, we have to fight off some bowling headwinds temporarily, maybe some virus headwinds temporarily, i still think, after two big trade deals, in china and usmca, because of the president s policies of tax cuts and deregulation, and Energy Independence and greater markets overseas with the good trade deals, i still think, by the second half of this year we will get back to a 3 growth zone with a historically low unemployment of around 3. 5 . I think its a very solid economy and by the by, thats what the stock market is telling you. Even with some legs and wags on the virus story, stock markets telling you that. And i think consumer net worth is a big cushion for spending and jobs. Maria i agree, the backdrop aside and when you look at wages its real strong. But i want to stay on the coronavirus for secon Second Period people arent uncertain because of the unknowns. Larry, when you see china pretty much a shut down because of this virus, no flights going inandout, number of countries shutting down operations there. What will be the Practical Impact . What a base supply Chain Disruption . Is the fact that were going to have shortages in components and parts . Is that going to impact turning . How significant, and i recognize you dont think it will be that significant when it comes back with the second part of the year, but what would be the Practical Impact . Its hard to be precise. I understand that. Some people are reporting a peak in the chinese virus revelations, the headcount. That may or may not be true. I am seeing conflicting information on that. What i want to say here, and i have talked to the doctor about this who is the best in the business, in the usa, it is completely contained, completely contain. Maria if that story changes, things will be worse. But right now, it is completely contained here. Now your point about the supply chain over there, because chinese industry is shut in, is an important point. I grant you that point. How do you quantify that for the u. S. . Awfully hard. We are thinking maybe in the First Quarter we lose two or three tenths of gdp two or three tenths of 1 of gdp. Thats in line with some of the private analyst. But i acknowledge a lot of uncertainty here. Let me make this point however, usa manufacturing inventories are at rock bottom. In fact it cost us a percentage point in the fourth quarter. So it is quite possible that some of the slack in the supply chain could be picked up by Semi Conductor makers and automakers, and other parts of industry here in the u. S. That is a possibility. Maria are you working on another tax cut plan, larry . Yes we are, tax cuts to point out. In a meeting in the oval, two days ago, he looked at me and said lets get it out by september. I have been consulting with the house colleagues, my great friend kevin beatty, i will be consulting with senate colleagues, we have some great internal ideas and other outside advisors. I might even come to you to steal your tax program is going to be. Wed love to have a 10 middleclass tax cut. And we would love to strengthen and make permanent some of the other tax cuts, that includes one 100 expensing and we want to fix that because there was a glitch and the structured Building Structures should have gotten it but didnt get it. There are other matters, universal savings account, there are other things out there. I dont want to make the forecaster prediction yet, and the budget my great friend omb bussell barr has put a 1. 4 trillion plug to make tax cuts permanent. And we will probably use that to craft our package. It will come out sometime in september. It is a second term issue, maria. Its a future issue for middleclass tax relief and Stronger Economic growth. Maria that it divides the Federal Reserve we did hear from jay powell this week in his testimony to the house and senate npower said the Federal Reserve expect inflation to rise to 2 this year. They are having worries about inflationary issues when you see more workers and wages moving out. Your reaction to jay powell this last week and what about the prospect of inflation, larry . I just had this peculiar view, i have honed it over the past 40 years. Heres the view, more people working, successfully do not cause inflation. More people working is a good thing, not a bad thing. Inflation is excess money and a collapsing currency. We do not have that. We do not have that. What we do have, is low unemployment and you can take those tradeoffs between unemployment and inflation and throw them out the window. Now actually jay powell is saying that which is a good thing, i am glad the fed is asked banding its sheet again i think it was a big mistake in 2018 to raise rates. I want to see him do that more, even on the fed funds target rate. They moved in the right direction, but maria, sometimes i wouldnt mind seeing a little bolder fed. To your points, there is virtually no inflation. A markets price indicators, look at your break evens in the treasury bond market, are predicting 1. 5 inflation. So i think the fed has some elbowroom on that score. And i do not see inflation at all in the future. Maria but you just said, we talked about Economic Growth, he said we will probably get back to the 3 number in terms of Economic Growth by the second half of the year. The fed made a prediction and they said the gdp in 2020 will be at or slightly above 1. 9 larry. Thats the conventional view, feds, cbo, lots of other models that dont understand supply side, taxcut rates, and supplyside incentives. Heres a thought and will leave it here because were not to settle it today. The last four quarters, productivity, at output. Hour is up 8. and thats a pretty good number but from zero couple years ago. And that is because i think of our business taxcut incentives and regulatory reforms part 1. 8 productivity, the labor force is growing about 1. 3 or 1. 4 when you add those two things together you get close to 3 potential gdp. I think, a lot of these economic models and the government in washington and the private sector on wall street underestimate americas potential to grow. And i think the bluecollar boom, and the womens boom, and the great low unemployment without inflation is telling them they are wrong. So i remain my usual optimistic self, the president is an optimist. That was what is stated the union speech was all about. Thats what is dabos speech was all about. Optimism and the leadership, and america doesnt have to be second best. Maria more of my oneonone with white house Economic Advisor with larry k k k k k im your 70lb st. 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Right now i do. The policies all along, President Trumps policies have re opened the economy. Restructured the economy. We have created new incentives. We have strengthened markets, we have rolled back all of this deadly redtape on the regulatory front. And the lower taxes acrosstheboard have helped. In just one point, i think its overlooked a little now because of the virus. The trade deals that the president has negotiated are going to strengthen u. S. Export exports. I understand the china uncertainty. President xi jinping said they are gonna make their commitments by the end of the year but just in general usmca and the china phase one, kit should generate something of an export boom. And it is farming comments manufacturing, its technology its Financial Services and so forth. I think a lot of people having ignored that factor. And i think the trade component at gdp may be a heck of a lot stronger and the next year or two because of these market opening efforts. So that is a big plus. There is consumer side, look at these Household Net Worth numbers. Its on wall street talks about all the time. Consumer net worth is booming. In its year on year that is a function of the stock market, thats a function of the strengthening house prices. That gives them a tremendous push and i dont see why the job creation can slow, i dont see it slowing. Maria what i liked look at the wages, even on the bottom end, i made a point that income inequality has begun to narrow because the bottom corners are getting the biggest increase in wages. Your points are correct. The low end or doing the best. The middleclass is doing the best. The production workers are beating the top 1 managers whether its true for wages or by the way Household Net Worth. So we are in very good shape. The other boom im getting excited about, besides the bluecollar boom as the womens boom. Maria lets talk about that. Because the women have more jobs than men right now. Tell me whats going on with the women and why this is. I know you have been working with a bunker trump, in terms of skills read training what can you tell about women right now in the workforce. First of all maria unite Work Together in the past, i am married to a strong woman, my whole front office is run by women, women are stronger than men im glad theyre back in the labor force the womens Unemployment Rate is 3. 6 . Thats the lowest since 1953. 72 of the jobs created last year were for women. 59 since 20 16, 59 the job gains are women. The share of the workforce is 56 , their Labor Force Participation rate is rising its up to 77 . And as you noted, they are now more than 50 of the workforce. And incidentally on the wage front, again, your point about diminishing income inequality is a great point. The last three years, median Weekly Earnings for working aged women up 3. 6 . That beats the overall raise of 3 . Growth and prosperity makes everybody happy her. Lets get going. Maria lets get going, larry its good to see you this weekend. Thank you sir. My thanks to larry kudlow, more wall street right after this. [sfx doorbell] hello, i saw you move in, and i wanted to welcome you to the neighborhood with some homemade biscuits oh, thats so nice and a little tip, geico could help you save on homeowners insurance. Hmm cookies uhh, biscuits. Mmmm, is there a little nutmeg in there . Oh its my mums secret recipe. You can tell me. Its a secret. Is it cinnamon . Its my mums secret recipe. Call geico and see how easy saving on homeowners and condo insurance can be. Ill come back for the plate. Its a masterstroke of heartache and redemption. The lexus nx. Modern utility for modern obstacles. Lease the 2020 nx 300 for 359 a month for 36 months. Experience amazing at your lexus dealer. I had no idea why my mouth was constantly dry. It gave me bad breath. It was so embarrassing. Now i take biotene dry mouth lozenges whenever im on the go, which is all the time. Biotene dry mouth lozenges. Freshen breath anytime, anywhere. Everything your trip needs for everyone you love. Expedia. For everyone you love. We do things differently and aother money managers, dont understand why. Because our way works great for us but not for your clients. Thats why were a fiduciary, obligated to put clients first. So, what do you provide . Cookie cutter portfolios . Nope. We tailor portfolios to our clients needs. But you do sell investments that earn you high commissions, right . We dont have those. So, whats in it for you . Our fees are structured so we do better when our clients do better. At Fisher Investments were clearly different. Maria welcome back wisher to johnny next weekend thatll go for this weekend we will be here once again next friday night, 9 00 p. M. Eastern join me for my special interviews in the coming week plus the 70 over the fox news chatter sunday morning futures is live at 10 00 a. M. With arkansas republican senator tom carton and kevin mccarthy, catch the show live and then right foxbusiness start smart for mornings with maria at right here in fox news. Weve got a big week next week, former l. A. Mayor and former dnc chair and Federal Reserve chairman my special guests in the week ahead. On mornings with maria have a great west of the weekend everybody thanks for joining us have a happy president s day on monday. See you next time. Gerry hello and welcome to the wall street journal at large for about much of the News Coverage since it was on the first the nation president ial primary New Hampshire changing dynamic in the Democratic Party race. The other headlines on the continuing worries of the coronavirus. A disease that was first discovered her broken china late last years taken more than a thousand lives in that country. Including at least half a dozen healthcare workers. It has infected tens of thousands around the world. The head of the World Health Organization is called the