everyone, do not forgot. tonight something special is happening at 8 p.m. on the fox news channel. governor mike huckabee is holding a forum with the g.o.p. presidential candidates, a two hour live special. >> judge jeanine on after that to talk with the governor about the big debate. >> see you tomorrow. >> brenda: a recovery in the making or another head faking? the best week for stocks in three years. the best jobless rate in two and a half years. consumers buying, auto sales rising, and home sales growing. manufacturing surging, all signs we're moving forward, so, why is someone here saying, not so fast. hi, everyone, i'm brenda buttner, this is bulls and bears, let's get right to it. the bulls and bears this week, gary b smith, tobin smith. jonas max ferris, along with jim la camp senior vice-president at macro portfolio advise,and john

thomas financial's chief economist mike norman, welcome to everybody. jim, all of those arrows, the up arrows not impressing you yet? >> no, not at all. i mean, look, we've got 64% participation rate in the labor force, way too small and lowest number since 1984. we have 315,000 people that dropped out of the labor force, that's not acceptable. we're already in the fourth year of this recovery. keep in mind, previous recoveries have shown jobs growth in the first two years, but i'm not worried about that. i'm not worried about the fact that consumer income has not kept up with consumer spending, so, it's coming at the expense of savings, i'm not worried about that either. i'm not worried about expiring depreciation schedules and expense amortization. >> what are you worried about? >> i'm worried about the credit crunch that is coming. and the market is completely underestimated. >> brenda: okay. >> out of europe that will impact credit across the globe. >> brenda: right, okay, toby,

is this a recovery? >> this is a slow, but sure recovery, it's not happy days are here again. 2002 to 2007 was basically a b-s recovery 40% in housing and mortgages those things are never going to happen again. 40% of all the profits that happened between '02 and '07 were financial services never going to be that high again. let's not take the great news and go whacky, on the other hand. >> gary b. you see the seeds of recovery here? >> i do. i've been bearish, i think toby has kind of the speed right. i think maybe it moves a little bit faster than anticipates for a few reasons, one, the best number in there was retail, employment was up. that means consumers are going to start spending more. two, maybe even bigger point is temporary hire was up. that doesn't sound great, but fact is, temporary hiring usually leads to permanent hiring, in fact, the signs point. >> we have he been hearing that for hour years. >> hold on, let me finish,

please. if we can get back to that it00,000 job increase per month that everyone seems to want. and the other thing, jim mentioned, he's talking about the credit crunch and actually household debt levels are at their lowest levels they've been in 17 years, so, the consumer actually has room to expand, and as a consumer expands, so goes the economy. i think there are good things ahead. more good things than bad things. >> jonas, a recovery here. >> the main difference, this recovery has a huge potential to go wrong because of a lot of bad stuff, but it's here and if something doesn't go wrong, it's not the biggest recovery of all times, but the consumers have been thrifty or years. pent up demand and auto sales take off and holiday shopping well better than anybody expected both online and off line and a lot to drive the economy higher and the scary overhang there could be unrailing. >> and jim, i'm going to get to you in a minute. mike, do you think this is recovery? >> i don't think it's the

mikings of recovery, i think it's ongoing, it's been happening since 2009. look, it's not a boom by any means, i think that everybody would agree with that. look at this year and specifically some problems that jim mentioned, and i want to say hi to my buddy jim. haven't seen him in a while. and in spite of everything, the debt ceiling debacle in the summer and we've had all of this negative news about europe and we see sequential growth, first quarter, second quarter was faster than the first. third quarter faster than the second in spite of everything, i think the economy looks like it's picking up momentum and we're starting to see some positive, glimmer of hope from the housing market, with pending sales really shooting up, and we are creating jobs, it's certainly not where we'd like to have it right now, but, it's impressive to see the momentum and the growth despite everything that has happened so far. and there's still mine fields out there, no question about it, but the economy here in the united states, growing a

lot faster than the economy in europe. >> brenda: jim? >> well, i feel like taxpayers could get a t-shirt here. i've spent all of this money on stimulus and all i got was a lousy recovery, we've spent a lot. put a lot of bullets into this recovery and we're not getting very much. now, we've got this fiscal drag coming up. not only that, ignoring europe and saying there's a potential problem there. kind of like other than that mrs. lincoln, how did you like the play? this is a serious problem and it's not going away, it's getting worse every day and you simply can't discount it, granted, the market does go for the head fakes, every time european leaders set a meeting, but the fact of the matter is, the market's got a lot of head fakes in 2008, too, well before it bottomed out in 2009. >> well, look it, every recovery we've had since 1990 has been a no growth recovery because we have fundamentally structurally different economy than the times in 80 when we popped up. look at the job openings and labor turnover, that's the

jolt number. that number is about 2 million, 2 1/2 million in a real recovery about 4 million. >> and we didn't have, we didn't have-- we didn't have 64% participation rate in a real recovery. >> hold on, jim, let me get to mike, go ahead. >> i was going to say we didn't have a huge stimulus despite the fact it's portrayed that way. it was about 4% of grosse pointe woods at the time and it did take us from a very severe negative grosse pointe woods woods-- gdp and as far as the fiscal drag, i agree with you, but the cuts supposed to p had an as rault a result of the failed super committee, 2013. next year is not going to look that good, fiscal drag. >> brenda: you're talking about something that night derail that. >> the only area that hasn't come along for the ride. there's a dates at that point other than '09. the moment prices have not recovered.

if they start to go down again, for whatever reason, that could derail this kind of a weak economic growth period. other than that, for this explosion in europe, i think we're-- i wouldn't say off to the races, but a long growth economy. we're so used to bubble growth economy. >> gary b. go ahead. >> let me give the return, i agree with jonas on the housing prices, but there's one good piece of news in there, is that unemployment amongst the 25 to 34 year old sector showed a dramatic increase, that's the group that are looking to first buy their, looking to buy their first home, rather. once that starts to go, then, all the homes above them start to start selling because everyone wants to move up that can't move up pour in my case, move down that can't move down, so, i think that's really good news there, and you know, kind of, maybe the hidden gem and i hope a hopeful housing market. >> i don't want to throw cold water, but 2 1/2 million homes

that are foreclosure, another 4 1/2 million homes that are going into foreclosure, gary. >> we have a depression in housing and to your point, as long as we're at point where it's cheaper to buy a home than rent a home today in the united states, and still we can't get demand for sales, that's a five year tragedy. >> you're saying i'm never going to be able to mover, toby? >> there's only five people in america who can own your home, for crying out loud. >> believe me the number has expanded lately. >> what they're talking about. >> brenda: go ahead, jim. >> there is another issue nobody is talking about. 50% of corporate profits from overseas business. china is slowing down, europe is in recession, brazil said their growth is going to be zero percent. how are we going to continue to grow the way we've been growing when we're seeing everybody else, everyone we trade with slow down. >> brenda: all right. that's got to be the last word. thanks so much. so with things hopefully looking up, why is d.c.

looking to spend 1 trillion more tax dollars by the end of this month? you didn't hear about that? you will at the bottom of the hour, but first, put in the time or don't get it done. a new push to force folks to work at a charity before collecting jobless benefits. and is that fair? an across and for a hot dog cart. my mother said, "well, maybe we ought to buy this hot dog cart and set it up someplace." so my parents went to bank of america. they met with the branch manager and they said, "look, we've got this little hot dog cart, and it's on a really good corner. let's see if we can buy the property." and the branch manager said, "all right, i will take a chance with the two of you." and we've been loyal to bank of america for the last 71 years. our machines help identify early stages of cancer, and it's something that we're extremely proud of. you see someone who is saved because of this technology, you know that the things that you do in your life matter.

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>> a fox news alert. live from america's news headquarters, i'm patti ann browne. we are awaiting a major announcement from presidential candidate herman cain, he's expect today address the future of his campaign at the scheduled opening of a headquarters in georgia. cain's once surging bid has taken a hit with allegations of sexual harassment and a woman's claim after 13 year affairment we're monitoring this closely and we'll bring you any developments as they happen. brand new video in this morning from california. people now picking up the pieces after one of the worst wind storms in decades. forecasters comparing the

anti-anna winds to hurricane irene. so far, one person is dead and the damage estimates are in the millions and officials say tens of thousands of homes and businesses are still without power. i'm patti ann browne. now back to bulls and bears and for the latest headlines, log on to foxnews.com you're watching the most powerful name in news, fox news channel. channel. >> giving a helping hand before getting a governor handout. a georgia lawmaker pushing a bill, forcing the jobless to volunteer 24 hours a week, before collecting unemployment benefits. and gary b, you say, bring it national, huh? >> exactly. and i think this is brilliant, brenda. you know, it's already been proven and shown in studies that the more a person gets in unemployment, the longer they stayed unemployed. this is a good way to get them back doing something, build some self-esteem, help the community. now the rejoineder is, oh, my gosh, they won't be able to find time to look for a job.

the average unemployed person spends 40 minutes a day looking for a job. but they spend three hours per day, in fact, a little over three hours, watching tv. so, the time is there. i think this is a great idea. i think it should go national. >> brenda: mike, do you think it's a great idea? >> no, i think it's a totally bogus statistic, 40 minutes a day looking for a job. this totally defeats the purpose from what i can see. if you want to give unemployment insurance benefits for a fixed amount of time and telling people for a portion of that time, maybe a decent portion, you've he got to go do this volunteer work and you can't look for a job, that's a ridiculous thing. look, if you want to have a work for pay program, i'm all for it a government jobs guarantee, where somebody works and engages in productive activity for $8 an hour, until they can get back into the private sector. but, doing something like this to me, is totally ridiculous and it's, if this is the epitome of, you know,

government waste as far as i'm-- >> toby, you agree? >> no, i don't. look it, there is a part of your insurance, you paid in and your employers paid in, i understand that part. >> exactly. >> what i'm talking about after that's done and another 70 weeks out of that basically from the general fund. 5 million kids or 15 million kids in the united states who could use tutors. >> that's not what they're saying. >> and 5, 8 million homes owned by freddie mac and fannie mae need to be helped fixed. let's have the people now on the government dole after their run out of their own money-- >> that's not what they're saying, they're saying volunteer first before you even get the benefits. >> brenda: hold on, mike, let me get everybody in. jonas you bring up the point, you do pay in to unemployment insurance. >> it's an insurance policy. it's not a-- i mean, it's like if your house burned down you got a check, we're not getting the check unless you do work for the committee. that's not the deal, you paid

a premium. mike has a good point, you have insurance, if you wanted a different program, rather than extend the program, a works project, that's a different story. weeks of unemployment insurance, right or wrong, you kbt say, 13, how many million people out of work there's not enough community service work to this community. >> come to my community, friends. >> billions of dollars. >> at his house alone. >> brenda: and all right, i want to ask jim. because you have some doubts about this as well, huh? >> i do, and i agree with some of what everybody is saying. i think we ought to send them to clean up occupy wall street parks and the other parks around the country, that they have ruined. especially in l.a. but, no, i think that, 24 hours a week is way too much. and i think if you did ten hours a week and found something more productive for them to do that would be okay, look, 24 hours a week, you're going to have to spend a lot of time and gasoline just getting to these places and it's not as productive as it sounds. so it's not the worst idea

that we've seen. i think they'd be better off lowering the minimum wage and allowing employers to drag some more people into the work force, but, it's, again, it's not as bad as some of the other ideas that have been thrown out there. >> gary b you've heard both sides here, what do you say? >> well, first of all, i haven't changed my mind. 24 hours a week is not a lot. when they're-- you know, contrast to what mike thinks, it was a survey, actually done. they're watching tv three hours a day. as far as spending gasoline and stuff like that, my gosh, take this to the people in manhattan and have them walk ten blocks and start fixing up the infrastructure. if we can train people to do things like habitat for humanity. we can help them fix bridges and clean up parks, it's out there and the other thing is, it acts as incentive. if you know you have to do volunteer to get this stuff you're going to be working hard tower get a real job. i think this is a win-win for everybody. >> brenda: mike 30 seconds. >> people should work to get that money, in total agreement

with him and that's called a government guaranteed jobs program until you can get back into the private sector, i'm all for it, let's do it. >> brenda: all right. thanks, guys. lawmakers now, looking at a cut off congressional pensions to curb costs. someone here says, why stop there. scrap all government pensions to get our debt under control. [ male announcer ] how do you trade? with scottrader streaming quotes, any way you want. fully customize it for your trading process -- from thought to trade, on every screen. and all in real time. which makes it just like having your own trading floor, right at your fingertips. [ rodger ] at scottrade, seven dollar trades are just the start. try our easy-to-use scottrader streaming quotes. it's another reason more investors are saying... [ all ] i'm with scottrade.

>> coming up, the poll that could have cushy government pensions coming to a screeching halt and finally reverse our deb

>> chipping away at our debt one tension at a time. lawmakers pushing to end

pensions to save money. toby you say stop there. >> we can't afford the entire, 24% of the private sector, why is that? because the private sector has to account for all the money that they owe and couldn't afford it so they had to structurally change. our u.s. government employees in theory were paid less so they got a better pension and that's bogus to use mike norman's economic-- we've got the point back and now, most of the jobs in public sector. >> brenda: all right. mr. bogus, what do you say? >> well, i don't know if anyone has noticed lately. there's a little thing going on in greece and europe, whereby the way, they cut all of these people's pensions and guess what, their debt went up, folks, it doesn't work. okay? and the other thing that doesn't work is when you reduce people's income, guess what happens? your economy shrinks and we've all said and sitting here talking about how the

economy's so weak, is that really what you want to do? is that the solution? i say it isn't. >> brenda: jonas, what do you say. look, if you want to make the case new employees for the government should have no or small pensions you're talking about existing pensions or cutting them out. it's absurd. not the workers falt, their whole life for a pension, and a budget problem. it's not just unions and all of this stuff. they've played a roll, but they were trying to balance books and so is gm. pushing off pay to keep the current salaries low and now it's come to roost. they would have had to pay more in earlier years if there weren't the gravy pensions, it was done to balance city, state and local budgets, 10, 20, 30 years ago they wanted to pay because it looked good at the time. >> brenda: jim, what do you say to that? >> you can't take people and promise them something and take it away from them. you have to stop it moving forward because the math is horrible. mike is right they're using a

grecian formula to come up with a way to pay these senators (laughter) >> and that's a personal-- and at any rate, the math is not there and toby is right, and there's no way that you can let somebody work for 30 years and pay them for the rest of their life when they're living to be 85. the math is not there. they have to stop it there. congress notably who set the rules needs to get on the social security program, and needs to get their kid out of cushy private schools and kquit running away with everybody's money. >> brenda: gary b, what do you think? >> take the greatest hits from everyone said and have a good proposal. and the people that signed up. that was the contract and they should get the pension. >> i'm not saying get rid of them. >> i think it's for the new people brought on board and not saying get rid of pensions, if you look at the numbers there, the pensions from annuities is almost

double what the private sector gets. what people want is fairness, they don't want the bloated fat cats to be working for the government for growing out loud. and the government, just bring them in line and the fact is, as i think jim pointed out. >> brenda: okay. >> we can't afford-- >> you guys, i'm sorry, we've got to go, but i have to say that the federal pension is underfunded by more than half a trillion bucks, but anyway, last -- i've got the last word. thanks, guys. it was blocked, but someone here says not for long. the on again-off again pipeline that could create 20,000 new jobs overnight and shovel huge profits your way, but you've got to stick around for the name. [ mujahid ] there was a little bit of trepidation, not quite knowing what the next phase was going to be, you know, because you been, you know, this is what you had been doing. you know, working, working, working, working, working, working. and now you're talking about, well you know, i won't be,

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a >> predictions, jonas, you're up. >> improving jobs numbers, means jobless on the internet, monster, up 30% in a year.

>> brenda: jim, what do you think of that? >> bear, the credit crunch is going to hit the jobs market. i like gold, they're easing in brazil, china, england, europe, united states, higher gold prices, j-o-b. >> brenda: gary b are you bullish and gold? >> i'm yuckish on gold. and google is taking on amazon in the one day shipping area. and the stock is up. >> brenda: mike you like it. >> i'm a bear, i think that google is fairly priced, i do like china. last week we saw china taking the foot off the brake. and fxi china 25 etp. >> brenda: toby bull or bear. >> bear, too early. but i like them, they have the pipeline through the united states, they're going to build it no matter what the united states does. >> brenda: jonas what. >> apple and google, not a good deal. >> cash flow. >> they don't need cash flow.