Pros Say: U.S. Needs 'Bad Bank' & Stimulus — Now

Thursday: The Obama administration economic plan now envisions a smaller role for the aggregated bank concept — and will involve less money than first thought. Wall Street exec compensation is still under the microscope as a TARP-takers' salary cap is debated. Jobless claims hit a 26-year high; and one observer says a housing bottom is finally "in sight." CNBC heard from experts who praised Obama's "bad bank" and stimulus ideas — and carefully upgraded the equities market.

Could the Markets Breach November Bottom?

Rob Morgan of Clermont Wealth Strategies said he hopes the Nov. 20 lows will hold, despite talk of another leg down. He's been very negative on equities — but has recently moved stocks from underweight to market weight.

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JPMorgan Private Wealth Management's Anthony Chan said the Index of Leading Economic Indicators may not really suggest a turnaround soon, because so much of the Index is currently driven by money supply. We can only hope that inflationary pressure can be held down when it finally develops.

Shopping Maul: Retailers Slammed in Worst January Ever

Telsey Advisory Group's Dana Telsey said it looks like the worst January ever for American retailers — the holidays over, the consumers staying home in bad weather, chains like Macy's forced into huge layoffs. Outside of Walmart, there were few bright spots; even discount giant Costco suffered disappointing results. The department stores have become so "promotional" that every level of consumer has been able to trade up and get the same prices from the next-higher level of retailer.

Fund Legend Bogle Praises 'Bad Bank' & Stimulus Concepts

Vanguard founder Jack Bogle said social policy is being unnecessarily packed into the stimulus bill. "Down-the-line" partisan spirit did not serve us well in the last administration; so intelligent compromise is the best course now. Unfortunately, pork is a popular menu item on Capitol Hill. Bogel says President Obama is right: We need a stimulus bill and we need it now. Creating a series of bad banks appears to be a good course; it has worked in the past, it makes intellectual sense, and it makes common sense.

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Counterpoint: Stimulus Plan Stirs Little Optimism at Big Board

Art Cashin of UBS Financial Services pointed out that the executive salary cap only applies to the people we need to lead us out of the crisis — not the ones who got us in. Wall Street is losing hope for a clean stimulus package, and what gets passed may be an amorphous and ineffective mess.

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