Go eat dinner. O , but only one at republicans are hong wil pass. Here with exquisite exclusive details, richardson in washington. Good evening. What republicans are looking to do in the house is basically deal wh the tax provisions of the fiscal cliff to hit on january 1 so thereill be two amendment votes on the house. The first constructed by republicans dubbed the nancy pelosi plan because it contains a number of the provisions she holds. Amounts less than 250,000 per year, it extends some of the stimulus provisions with income taxpayers, child cred, and raising amounts more than 1 million. This is a republican plan ,com,com ma the one if it goes past the house, likely to pass the house, it makes the current rates permanent for amounts less than 1 million per year. It takes Capital Gains and Dividend Rates nw 15 , make them permanent for amounts under 1 million for amounts me than 1 million it is 20 Dividend Rate operates. There is a permanent estate tax of 35 for amounts of more than 5 billion bid the sequester, automatic spending cuts set to hit starting ojanuary 2 or 1st, essentially an automatic cuts t to payments for doctors o treat medicare paymentcome excited on implement benits, all these other elements of the fiscalliff arent helped with, that is why House Speaker john boehner is still negotiating a larger house deal with the white housend republicrepublic ans are discouraged by what the president offered them last night, they he this backup pl on the table and these are the items they will vote on in the house on thursday. If anything is goingo pass the house is republican plan and then theenate where the Senate Democrats say it has no chance. Gerri here we go again, thank you for tha so are we further apa than we were4 hours ago . And if the president now telling fox who took a step back today, the last 24 hours feel a little uglier. We will be joined in a moment, but first, art lafferr former advisor to president reagan. Welcome back to the show. You look at this plan on the table from republicans rightow and they are calling for higher taxes, what do you make of that . They shouldnt be calling for higher taxes, but something has to be done and all those taxes will go up if we let it go over january 1. I would li to seesome t cuts extend, and that would be great. I would like to seehem all extended, but thats probably wont happen. I think theyre moving in the right direction, it is the right thing to dpolitically as well. Gerri mark ts in the books of history. I have never heard you say that, personally. Ipronouipronou n was comparing the two planans sidebyside, wt republicans have put out and the white house had put out, let me tetell you, these two plans are different, but not in their affect on theoverall debt. 10 years from now, either plan goes into effect, 21 trillion in federal debt. T is a realurden on future generations and it makes it very difficult to get a political economy of growth g in 2014 or 2016 when politics will change. That is the way it has be going for long time now, and it has got to stop but obviously today is not the day it is going to stop. Gerri talking but all the other taxes a part this, so much at stake, are you confident some kind of agreement will be reached . I think some will be reached, yes. Republicans in the house are not very agile. It is hard to control 235 membs, they all have different views and the president has a huge advantage in game planning but once this is over the president will own the economy next year and next is econo will look retty bad and in yo great damage to the Democratic Party in 2013. Am hopeful in the long run but will be better this year than next year. Gerri you said it is okay by you to raise taxes on the Million Dollars plus. Are they takg a responsible stand here . Some republicans in the house even now saying this isnt a tax cut, leadersh framing it a a tax cut, it isnt a tax cut, it is a tax hike for many people. Do you think americans will get the real deal on this, so many people feeling they are misled by both sides of the aisle. The point is if we go to january 1, all taxes rise and the question is if you pass a bill now, to exclude some of the taxes that are going to ris at least get some of them tt wont rise, that is the way i look at it. E president does have controlled the wte house control of the senate and control of the negotiating tuation cause all those tax cuts go up. He is doing e best he can. Rri he wanted to protect this may taxpayers as he could. Let me take you back a couple of years. President ronald reagaying we cant spend ourselves rich. I want you to weigh in on this, there seems to be no serious discussion of where to curb spending. What to do with entitlements, that is spending out of control. As you know, this is the majority of the budget. What are you going to do in the president doesnt want to do itn the nate doesnt want to dot either . They dont have control of the political Economy Today and they can use the debt ceiling, and i really hope they do, to bring spending cuts in place, t this is not the way we can really make a Major Overhaul of the economy. You ha to wait and see, and then 86 tax act which rocket shaped the economy straight up, mostly democrats voted back then as well. All but three voted with us, so that is amazing. Gerri there are a lot o strange alliances being built here bid a lot of people saying one thing and doing another. E democrats at one pointad back a plan not too long ago about tax increases on people earning a Million Dollars or more. It has not been that long ago talking about a three for one deal, 3 in spending for increased 1 in taxes. Now it is onefor1. Has boehner gone too far . He is under a lot of pressure on that, but the question im sure he kws his vote as well, john boehner trying to save as much as he can to keep the economy from collapsing. I think its a great job. I wish he didnt have to go this far and i wish we couldve got the extension all the tax cuts but i dont think that is possible. I admire him foroing tha although i wish we couldve gotten more of the tax cut through. Gerri he said this morning real discussion of tax reform and entiements will have to take place next year, but att that point what kind of leverage will the Republican Party have to make that happen . It is not going to happ in this next two years, there is no real reform that will happe you may get a piece here or there but you get a real fundamental change with adetermiadetermi ner low rate flat tax spending restraint, free trade minimal relation, that will not happen until the politics of this country changes, change the senate and the white house to be will to get that kind of real change, that will take several years before it takes place. Gerri w longer. It is always a pleasure to have you on the show added to hear the show attitude here would have to say with so much experience with th topic. Thank you so so much. Thank you. Gerri coming up after the break, we ll talk about how the day has unfolded, plus how all businesses getting ready for the fiscal cliff and how that will impact you. And the big factor everybody missing over federal spending is the automatic spending increases. You will not believe how congress is spending your money. I will break it [ morgan ] whats better than epic offers from visa like 20 off ea srtmadden nfl 13 . You should never go forth and fourteen, you cant do that. [ morgan ] getting a chance to hang out with madden in his game room. Blue go. Did you hear the pop . [ morgan ] and barbecue with madden. Watch football with madden. Learn from madden. Was that good, coach . [ morgan ] and get coached by the ultimate coach dden. Does all this make sense to you . Um, yeah. [ morgan ] yup, pretty epic. Join visa nfl n offers and make your season epic. [ male announcer ] rated e for everyone. Gerri negotiating on e fiscal cliff toy, the house that to vote on two amendments and then it is up to the senate to pic up the ball. Senator, welcome back to the show, always nice toave you here. Thank you very much. Gerri we just spoke with art laffer, i was surprised to hear him say he sees room for compromise and he was okay, as he put it, with what republicans were putting out, higher taxes for people earning a Million Dollars or more. And then listen to this. I cant imagine i would not be supportive of a proposal that had permanent tax reductions for substantial portion othe american taxpaying public. My own vew would be to not raise taxes on anyone but we will do with the package from the house, majority obviously will have a chance to change it. Gerri is there compromise in the air, are we close to a deal . There is me compromised than were hearing from both sides posturing as pple do in negotiations, but i see a coming together. I think john boehner has been very bold, put something on the tabl that includes tax cuts on the vast majority of people in exchange for real spending cuts. I thing the president has come to the table with a central if were going to get social securi in a situation where it can last for 75 years. 200,000 is two college professors. We had to geaway from that from being middle class. Gerri i think somebody is listening to in the the new york delegation. That is difficult to raise a family of four. Let me get to you some of the issues bubbling up today. Senate republicans baby feeling like they are a little left out of the conversation you have been really outspoken. You will be leaving, do you feel like youave got to get this done at this point . I do think we have to come to me accommodation. I think it has to be balanced, it has to have spending cut we have to see a way forward to get the debt down. We are on a fiscal cliff. Yes, we have to do something. We need some losses, that is the way negotiations go and we dont have a great hand to play. The presidendoesnt have a full han to play we have to have some given some take. Gerri you keep describing them as tax cs, that is not how most experience i they will have no changes how they will experience it so im not sure the American People will see this as a great tax cutting gift at christmas. It is the bushera tax cuts which cause caused the economy to pick up, it increased it in a way that wall wanted to. Creating jobs in the vibrant economy. Now were in a doldrums and it is continuincontinuin g the bush tax cuts exactly what we need right now. Gerri anything to be concerned about in ter of the details . The issue is not just the fiscal cliff but also the alternative minimum tax. There is the estate tax. The alternative minimum tax is very important because it will kick in in the lower 30,000. And we have got to fix that. Estate tax, affecting Small Business and farmers, i think we need to keep that at the level it is now. 35 , 5 million exception. There are a lot of democrats that agree with republicans oo that because tey ce from farm states and no with a burden that ca be. I feel fairly optimistic. Gerri we dont have a lot of time left. Yoproject we will have some3 sort of deal before december 31 . I do. I think may be dragged out until the end, but i think there will be a deal. Not something everybody likes or maybe anybody likes. But at least if wean avoid the fiscal cliff and we see some sign that we will get thisebt down and we can govern in a responsible way, that is what the market is lking for and American People and families are looking for. Gerri thank you for coming on, hope you come back soon. Meanwhile there are growing concerns tonight among many sml Business Owners ahead of the fiscal cliff, many of whom are looking to sell their businesses to avoid higr taxes come janry 1. Joining me now, thank you for coming on tonight, appreciate it. U and i talked by phone not too long ago and i asked you what is the reaction among people who have a Small Business and they know they will sell it some point, what have they done this year . It is kind of schizophrenic. A group that is scared of the uncertainty, they held back and they waited too long, they didnt prep their business up and some liked the gold ru at the end of the year, it is a stampede to the end of the year. I bet you every firm that does Due Diligence is going upwards. We will not be able to get it done by the end of the year. Gerri are there deals you wat done that you dont have enough hours in the day . Exactly. 3 that is just one deal, but we have multiple deals going on, many people have given up at this point and are now not takingefensive strategies restructuring the deals so th can avoid or otherwise defers me of the tax. Gerri what is her biggest fear of going over the fiscal cliff . What is the issue for them . A lot of people have decided to hold onto the business and they realize in order to compensate for the increase in taxes both Capital Gains and income tax, the cial security tax increase, and the Obamacare Tax 3. 8 they will fit, they feel the need to hold onto the businesses and i did some calculations and went on to cfo. Com and said they would have increase their bottom line 24 . It would take three or four years and a lot of capital to get even with the net proceeds from the business in 2012 so they would have increase the bottom line 24 to make up the tax hike. Gerr i get a sense even if th did not have plans to do that, theyre still very anxious because of the issues yoare mentioning. The rise in income taxes, it is hard for those folks to fight that kind of plate, what are you telling them . It is more specific and more than that, a lot of people are planning to get under the 49 maximum employees before obamacare compulsory insurance kicks. We will be cutting down and going with parttime, theyre taking defensive strategies right now. Therell be cutting back on Capital Expenditure because of the writeoffs that wille decreasing very rapidly and that will decrease capital investment. I could go through 100 things. Gerri the beat goes on. Incrcredible wt we have seen with the changes in the tax law, youre very knowledgeable. I hope you come back sometimes doing and tell us whatappened after the first of the year for these people. Thank you so much. Thanks a t. Gerri coming up the not the real danger to our economy is in the automatic spending cutsr tax increases on the fiscal cliff, it is the autotic spending in the budget. I will explain. And the newest republican senator Center Promising to shake things up in washington. Stay with us. You know how painful heartburn can be. For fast, long lasting relief, use doctor remmended gaviscon®. Only gaviscon® forms a protective barrier that helps block stomach acid from splashing up relieving the pain quickly. Try fast, long lasting gaviscon®. Omnipotent of opportunity. You know how to mix business. With business. Anyou. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or ave. And still pay the midsize price. I could get used to this. [ male nouncer ] yes, you could business pro. Yes, you could. Go national. Go like a pro. Gerri when it comes to the fiscal cliff, getting, ll out there. Of letters pretty soon. The problem is capitol hill has grown so accustomed to expanding Government Spending even the republicans hardly know how to cut the flow of tax dollars. How bad is it . Since 1974, nearly 40 years the baseli the federal budget automatically increases every year. That is before anybody even cast a vote. That makes it easier for politicians to loolike theyre cutting spending when in fact they are simply cutting the growth o spending. It is all gimmic. Course we have had budg submitted in four yea. Washington has made even worse by the federal bureaucracy, every single day congress misses a deadline to pass budget that takes a nancial toll on taxpayers. Just four times in the past 37 years, nearly two decades, Congress Passed a budget bill before the start of a new fiscal year. As a result as you might expect everybody makes changes, federal contractors guard against budget uncertainties. Exnsive monthtomth contract instead of annual ones which would be cheaper. Bureaucrats make has or unnecessssary hires because of uncertainty. A university of maryland professor who studied the bureaucratic nightmare. The solution for all of this mess is more gimmicks according to washington. The two plan table do precioos little to solve the big problems like the 16 trillion debt. Obamas plan, 1. 2 trillion in revenue increases, 1. 22 trillion in spending reductions, total, 2. 42 trillion savings overal onto boehners plan. Boehners plan is 163 trillion in new tax revenue, 4 trilon in spending cuts. A total of 2. 663 altogether, total savings. These numbs t together by our brain room. The two planets line up like this, are we having a problem with graphics or what. Here it is. Look at thesnumbers, over 10 years 4. 6 trillion, boehner plan about the same, the is not that much difference here. Given the fact we will add almost 10 trillion in deficits over the next 10 years whether either of the plans are enacted we will still have 21 trillion in debt by 2022. I thought maybe i would see the soldiers again. Which makes me think thanks washington for nothing. They would do little to save the financial mess. Gimmicks, all gimmicks. Coming up, picng Tea Party Favorite for the senate seat. Reaction on what it means for the future of the g. O. P. Gerri libers love to say the g. O. P. Is the all white male party, but Senate Republican will be the only africa american in the u. Senate. The but, spent from South Carolina elected to succeed jim demint. Here to weigh in from the weekly standard. What do you make of this . It is fascinating to me that the only black senator would be a very conservative tea party candidate. The irony given all of the hammer and we have seen at the 2012 election aut the lack of diversity amongst republicans and what have you is if you look across the Republican Party and people likely to be leaders in the politics 10, 15 years from now, many republicans of a variety of ethnic and racial backgrounds were most likely to be the leaders whether it is tim scott or marco rubio, brian sandoval, these are people who e wide looked at bipartisan fashion. With that as for theoleaders in america. Theyre all republicans. Gerri it is really fascinating. This to say about the selection. While i get this minority female, that is at everybody wants to talk about, i want to remind everybody h earned this for the person he is, he earned proven and he will continue to earn it for the leadershileadershi p that he showed. Gerri what do you think of the street credit . Speak of the fact he is an articulate and forceful proponent of small government conservatism and an avatar of the Tea Party Movement itself secondarily is he brings bring some level of diversity. The look of the kind of things about tim scott entered congress, who are the people who really have been looking at, the most likely leaders to emerge from this class . Well the first people named from the very beginning. The way he makes the argument. Gerri his background fascining. He was not successful right away. What about that . This is a guy who grew up in politics, just a contrast there is notable in and of itself. Immediately one of the most confidants of the leadership despite the fact coming from the tea party. This is somedy who came out of the teTea Party Movement and was mediately trusted by the Establishment Republicans because of w he is and the integrity he brought to the job. Gerri build his own business from scratch, just a really pressive track recordd not somebody who camep in a typical way. Gerri do you think we will see him hold onto that and elevated even further maybe into the Party Leadership . Unless they make some major r doubly expected to make, somebody will be on the National Scene for a long time. Constives in South Carolina getting reelected as long as they want to be reelected as long as they continue to articulate the kind of views he has articulated so far in his short career. Gerri thank you for coming on, have a Great Holiday if i dont see you. Were switching gears up a little bit. Yesterday, hope you remember this, the top five gifts women dont wantor christmas. Before we get to the top five, the gifts men dont want, we want to know. Logon to gerriwillisom, i will show the results at the end of the show. All righ ladies, with the help of our friends ,com,com ma here are the top five gifts not to give your man. Coming in at number five, ties. It is considered touring and forgettable, but i kind of like them. Does nothing to be excited about, they say. He doesnt want it, whatever. Number four, colombia did telling him how to smell is not very nice, i guess. Number three, selling gadgets. He cannot throw anything as seen on tv in that category. I get that, nose trimmer. And finally the number one item, a gym membership. Like womenen dont want diet products, your man does not want to be told he should lose weight. The worst part, he may retaliate and give you the same gift next year, you dont want that. More and more students applyin early to collegewe will te you what to do if u are denied. And under Holiday Shopping yet . The top five gifts men dont want this christmas. We will be back. Hey, its me, progressive insurance. Yep, the i am with flo. Hohoo watch it [chuckles] anyhoo, 3 million peoplewitched toe last year, saving an average of 475. [sigh] it feels good to help people save. With great discounts like safe driver, multicar, and multipolicy. So call me today. Yoll be glad you did. Cannonbox [splash ] gerri f youre collegebound looking for a spot in the class of 2017 you better check your mailbox this week. Early admission messages have gone out. Here with information on how to handle Early Admission letter, rejection, deferral, founder and ceo. So, why are so my kids applying so early, what is going on . To understand the regular admission is filled with students from the u. S. And abroad, much mor competitive so if they can get their stuff in early, they have done the research i finished their testing they will apply early because the chances of getting in a slightly higher in the early rounds. Gerri or numbers show more and more kids arerying to do this, give us an idea of the trend. We have not tracked the number of students who applied early. It is accepted by 480 at colleges nationwide. You have supplements to fill out, but what we he actually contacted individual colges and what we have seen is huge numbers in the early rounds, so 40 , university of virginia and chicago are up 19 eac northwestern, Miami University in ohio reporting record numbers. Gerri is that why theyre seen such big increases because these are really greatschools. Both public and private schools are seeing an ireasee we are seeing more kids are being deferred as well because theyrtrying to figure out eir classes for this kind of a predictor of what is going to happen. Rri if you applied early and are denied, what should you do . Writes them a letter, let them know what youve done in and out of the classroom since two applied and new test scores and have a senior year teacher write another letter of recommendation on your behalf. Gerri so keep plugging away. If you are denied, what should you do . Hopefully you he done your research right you will have a list of at least 10 other hools that are aood fit school reachin the targets and your work in those applications now before the decision deadline. Gerri you may think now i can coast for the rest of the semester, but you say no way. We dont want to get senioritisyou have to work hard the rest of the year and be careful about writing in school or on facebook. A lot of kids who did not get in early and they are dealing with their own emotions on the process. Gerri what are the standards . A lot of schools will try to cap at 30 of the incong freshman class but we have seen schools admit as much as 40 or even higher than that of the coming freshman class in the early round, which is why it is so competitive. Gerri thank you for coming on, appreciate your time. Up next one of the top Financial Advisors joining us with the fiscal uncertainty. Questions you should ask your advisor right now. Great news to report, how santa claus is coming early this year for drivers. Stay with us. Gerr the stock market rallied today on hopeshe fiscal cliff deal may be near. Up athe close. Many experts warn we will fall back into recession if the fiscal cliff hits, but my next guest says maybe not. Your portfolio could be scared. Chairman and ceo, i thought this was really interesting because its very contrary to what a lot of people might think and want to run through some full screens to show people what you are talking about spifically. He looked at some recessions in the past, so lets start with the fit fullscreen. 100,0 invested in the 198182 recession wouldve earned one heard 80,644. The total of your portfolio at the end of the recession. Likewise moving forward to the next recession, if you started with 100,000 come he wouldve ended up with more than 114,000, i think youre getting the picture here. And one more, during the 20012003 recession that ended up with 126,000 if he you started with 100,000, completely contrary to what most peop expect, they think the stock market goes along with the economy. What you say . That is a myth. The stock market and economy are to two Different Things. High unemployment, and yet stock market is more tan doubled, suite have to recognize the ecomy and the stock market are two Different Things and investors do not necessarily have to fear a recession. Not that we shouldnt be unhappy about it or try to avoid it but dont think it is armageddon if it occurs. Gerri people are worried about the fiscal cliff and dont know what to do, trying to figure out how to even taught my Financial Advisor about this. How much concentration in my portfolio, what do you mean by that . We have to make sure we dont have too much of ouroney in a bad place. How much of your money are in stocks as opposed to bonds or real estate or gold or foreign utilities, diversification is the best way to protect yourself in this economic uncertaiy. Gerri what is the risk here . As Interest Rates begin rise, and eventually they will, bonds will fall in value, suite have to make sure you dont own longterm bonds. It should have Maturity Dates of five to seven years or ss, three years would be great. If Interest Rates rise come he wont lose a lot of money due to rising rtes. Gerri use a short enough, like no loads of bonds, that is really fascinating. Also talk about credit risk, w much credit risk with the bond holdings. We have to worry about bond issuers falling in their own value, miscible bonds issueddby state and county. Many corporations issuing bonds are also on shaky financial footing. We need to ensure the Company Company or the government that issued my nd will be able to pay off, if they get a credit card from aaa to singlea, the value of the bond could get cut as well. Gerri so i have to look at the bond ratings . And what is a safe rating . I would recommend you go only with Investment Grade aaa to singlea would be the safest approach with bonds. Gerri i think this is a good one, how much turnover is occurrinnually in my portfolio. Is lower always better . Yes ,com,com ma lower is better, lower in cost, lower in risk. People will buy a stock d if it does not perform in the next cole of weeks or a couple of months they du it. That high highlevel turnover only creates volatility, higher expenses and higher risk. You wan to make sure investments you hold are genuinely being held for the longterm, for four years, and if you find the Investment Advisers constantly making making changes in his advice or the mutual funds you own are constantly flipping from your doing with doing with a highcost cost, high volatile investment that is instituted for longterm goals. Gerri o i have to make all of these changes before the end of the year . Nity conversation now seeking properly position your portfolio for what mht come on january 2 in the new year with the new tax laws, the new economic environment so it is definitely worthwhile having this conversation with your advisor right now. Gerri i love the advice, always great to see you. We will be back with my two cents more and the answers to the question of the day. Have you ever rejected . [ male announcer ] at scottrade, we believe the more you know, the better you trade. So we have ongoing webinars and interactive learning, plus, inbranch seminars at over 500 cations, where our dedicated support teams help you know more so your moy can do more. [ rodger ] at scottrad seven dollar trades are just the start. Our teams have the information you want when you need it. Its anothereason more investors are saying. [ all ] im with scottrade. I asked have you ever regifted something . Heres stories you shared on facebook. Billy says a riend of my gave me a beer i didnt like as a house warming gift, and i regifted it to him for christmas. Month thew says my sister got a used curling iron that was filthy. Thats gross. Finally, frank says, i rewrapped a bad holiday fruitcake giving it to my rude and noisy next door neighbor. Thatsommon. I like it. Thats what i say. 47 said yes, and 53 53 said no. Really . Are you telling the truth . I dont know. Finally tonight, santa close cams early for drivers. Car prices and insurance rates going up, but at least one