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tv   Varney Company  FOX Business  April 1, 2013 9:20am-11:00am EDT

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the upside. stuart: to me, it's e-commerce coming of age with a huge dollar number. that's gigantic and it includes paypal and that's a big chunk of the deal, but 300 billion stares me in the fact. >> absolutely. stuart: now look at facebook th's an important stock here. it's inviting the media to quote, come see our new home on android, end quote. there's an event for that this thursday. and there's speculation what officials are actually going to announce and they vary from a facebook phone, a real one, hardware, to updated android app. in september, please remember, facebook co-founder mark zucker burg made it clear they will not release a phone. and welcome back. >> thank you. stuart: let's start with the possibilities. number one they come out with their own phone, hardware, is
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that going to happen. >> no, i don't think so. stuart: hang on a second. how about a new operating system? >> no. stuart: not going to happen. you've got your own idea. >> a lot of people are calling it facebook home for a reason and invite might tell people what facebook wants to do, delivering a new home screen experience on existing android devices and might start out with htc to highlight what it could be. stuart: i've got my smart phone and looking at the screen. what is facebook going to do to the screen i'm looking at if they he do the new thing. >> today you have to dive into an app and a messenger app, a camera app. the idea is to aggregate all of those things with one home screen when you turn on the phone you see all of our friends updates and interact with facebook without the friction of having to do a couple of taps. right now when people look at facebook 14 times a day on their phone, from a study last week, what facebook wants to do we want to be in their face more and how can we monetize that. stuart: that's interesting.
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and begin here-- i turned on the smart phone and there it is. >> right. stuart: it's a facebook service that comes at me, what i see first thing don't to to click to get it anyplace, it's there. >> and messaging and camera would have facebook built in. the user experience would feel more like a facebook experience. stuart: how would they make money out of it. if that's what they do, how do they bring in cash? >> get users to engage more, there's a lot of reports about teens that are tuning out facebook, for example. if you make the home screen, you can't afford it, facebook is in your face and you're going to interact more because you see your friends updates coming in, but what i see longer term, what they could do with things like location. let's say you walk into a store like a costco or something like that and say, like the store today and we'll give you 20% off while you're in the store. what i'd like to see them do, leverage location and location-based offers. stuart: if they would establish a relationship with a retailer and pops up on your smartphone
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screen and you get a discount just because you walked in. >> exactly. stuart: is that possible? >> you can do it today on four square. you can check into businesses when you get in there and there can be incentives for you to do that. now, what facebook, i think what they want to do is get in on that action. stuart: you think this is a good idea? a positive for facebook in terms of future cash flow and userability of facebook? >> i think they almost have to. you see the other applications and instagram, they bought them for a reason. they don't want you to splinter off and using google plus. stuart: and facebook stock recently dropped to the $25 level and come down sharply. and 32 late last year or early this year. is that because facebook is no longer leading, it's actually following? what do you say? >> well, it comes -- when it comes to social networking
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they're leading, but the question, what services are going to usurp them on the mobile front? there are so many options out there, even on samsung, galaxy 1 4, so many things you can do with that phone when it comes out. some people might be using social networking less and they have to get out in front of this. stuart: so facebook is still not quite what we thought it was going to be, would you say? >> they need to make it more pervasive and this could be one way to do it. stuart: thank you for joining us. both the s&p and the dow will open from record highs as they hit those last week thursday, was the last day of trading then. the fed keeps printing money and markets rallying, but how long is this going to last? what happens when ben stops the printing presses? we'll have the opening bell and the judgment on that next. what is it that makes a husqvarna? it's not all the brilliant engineering, no. it's this that makes a husqvarna!
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>> all right. a couple of minutes until the opening bell. we're expecting either dead flat or ever so slightly higher open for the dow industrials when we get going this monday morning. first day of the new quarter, that is. let's bring in from chicago, scott shellady. all right, we've got david stockman warning about a figure market 4 crash, he's using the word collapse. is anybody in chicago paying attention to him or what are you thinking about this? >> every now and again we see
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these things come across our desk and when we get done reading them. one of two things or three things. maybe there's a great american ponzi scheme or he's missed the move or somewhere in the middle we've got to see some of the economic figures catch up to the stock market. and that's more what these guys behind me will talk about. we need to see more growth, more jobs, some things start to finally catch up to where the monetary printing has gotten us to right now. stuart: and friday we've got the big jobs report. is there any disappointment this week, that could be bad news for the stock market, i suspect. what do you say? >> we're in the perverse period where good news is bad news and we're going to print more longer. and right now, the pullbacks we get because of negative news are muted because we have some folks that missed the rally. and i hopefully think this, we can't continue to have all-time record highs in the stock market
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and also have all-time record highs and people on food stamps or unemployment. we're going to see the figures catch up to the equity markets now. stuart: i can't dismiss david stockman that easily. but more on him on the program. and scott shellady, thank you. and a new quarter begins today. we're expecting dead flat to maybe slightly lower. now, looking at the futures, indicate a loss at the opening bell, 5, 6 points, that's what we've got. bear in mind we're at 14,568, not that far away from 15,000. new highs last week. big deal here. all right, a new quarter begins, as we said. now, look at apple. it dropped 17% in the last quarter. first three months of this year. it looks like demand continues to slow for ipads. where is the stock this new quarter? >> after being down 17% for this
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year, it's down about a buck right now. and it's very interesting, considering we saw the major market averages and the dow and the s&p up 10, 11% for 2013 which started off in a great way, yet, apple underperformed. you talk about ipads and the fact that they're going to slow down the production of the ipad mini as well and we'll see what the next quarter brings for apple. see if they're hot again. stuart: we shall see. take a look where ebay opened. we mentioned before the bell, it expects to process 300 billion dollars worth of global commerce by the year 2015. that of course includes paypal. ebay did 175 billion in e-commerce last year. look at the stock. 300 billion dollar target and up nearly 4%, a big gain for a very big company there. what exactly does facebook mean with its announcement of a new home on the android? another big announcement is coming this week. will it be the facebook phone,
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an updated android app? what's it going to be. no market buzz around it. $25 a share this morning. to nicole, tesla motors selling more cars than expected and i've got to bet that the stock's up on that. nicole: oh, yeah, we're going to bring a winner this monday morning. it's up for tesla, the model s vehicle doing very well and beating the street. >> 11% is a big jump and i'm sure they'll take that willingly. all right, nicole, the criminal inside giant sac capital. that's getting closer to the billionaire founder steve cowan. the fbi arrested one of the top lieutenants on friday and led him away in land cuffs no less. the sec says steinberg benefitted from inside info on tech stocks and traded on the information, and fallen 6 million for sac.
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steinberg is the most senior official there to be charged so far. let's go back to the markets and joining the company now from portland oregon is keith fitz-gerald. all right, keith. everyone has an opinion when the stock market rally will end or will it keep going. here is the question for you. are you buying stocks now? >> yes, i am. but very, very cautiously. the situation now is very, very different than it was in march of 2009, association, and the market's come up 132% since then. but you cannot rule ott the tactffac tactffac tactf tactful-- rule out the fact, to me it's a huge contrarian signal. that's all it is? is it important. a successful investment banker is not out on the fringe, david stockman, he says we're going to crash, we're going to collapse. are people taking noticeelly
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buttons, everybody's got one. 85% of all buy-sell decisions are made incorrectly. you want it to pull in the horns, harvest your gain and continue to find those companies that the world needs, not that they want. you don't want to be piling into discretionary stuff right now. you can't change the fact that long periods of history shows ttat the market has an upward bias. stuart: you think it's going up some more? >> as long as uncle ben keeps his fingers in the pie and in washington, complete lack of supervision from the regulators. you give me a trillion dollars and i'll show you a good time, too. stuart: nicely put. but look, at some point, he's going to have to say something, which is interpreted as, i'm putting the brakes on the money printing presses. and at that point, i presume, stocks go down and big time. >> well, i agree because that's going to be everybody running for the exits at once. now, the smart people are going to be already towards the exits
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right now. this is like a frat party for lack of a better term. everybody is inviting new people to the party out the front door and everybody knows the police are going to show up, are looking out the back door. you don't want to do anything cavalier. but the market has a lot of liquidity sloshing around and what uncle ben and cronies wants to happen. stuart: we've got the big jobs report on friday. strikes me you could go either way with those indicators and the market would still go up. i mean, if it's rotten news on the economy, ben keeps printing. if there's good news on the economy, that justifies a higher stock market. it's almost a win-win, isn't it? >> well, it's a win-win, but the emporer has no clothes. euro is going to end badly, stuff in washington is going to end badly and nobody wants it on their watch. stuart: keith fitz-gerald, i wouldn't be so fast to dismiss david stockman.
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i think that article's got a big impact. >> don't get me wrong, i'm not dismissing the guy, i heed his warning, hear what he is saying, i'm suggesting that time is on your side. and investors would not want to miss that, because they missed the run-up of 2009. they don't want to miss it again. stuart: david stockman to make your point, sooner or later within a few years, i predict, this wall street bubble inflated by phony money by the fed will explode. you're right, time is on your side. he's talking years, not next week. >> yes. stuart: keith fitz-gerald, always good. thank you for joining us. two stories that show a growing trend toward on-line business and away from bricks and mortar stores. first up, banks across the country closing literally thousands of branches because more customers are doing their banking on-line. more than 2200 branches closed last year. and second, we've got toys "r"
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us, it's pulling, canceling its ipo because of fierce competition from on-line toy shoppers. people going to sites like amazon, big box stores changed the business landscape and now the internet is doing it all over again. and how is this for a headline? california as a comeback state. yes, that's in today's new york times and that so-called comeback is all because of the liberal left. so, are the democrats really the savior of the formally golden state as paul krugman says they are? we'll discuss that at the top of the coming hour. monday morning, new quarter, 7 early movers, and noticed the dow has turned positive and we're now up 5 points. so much for death watch for blackberry, a surprise profit in the fourth quarter. the share is down a fraction this morning. the video game retailer, game stop, warned of weak sales this year. profits better than expected and put the stock up a little bit. fda approves a new diabetes drug
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from j & j moving higher, only just though. that's it. a pay day for shareholders, at&t will buy back some shares, it's up just a little. and cisco's board increased the company's quarterly dividend 21% as it's reached $21 a share, a bit after door stopper. and standard & poor's raised rating on whirlpool, that's charles payne's stock, by the way, but it's down just a little bit this morning and we have american greetings revealing a deal to go private and market likes that. it's up 12%. back to the big boards, we've turned around and we're now up 7 points, open 7 lower and now we're up 7, 14, 585 where we are. time is money and this morning, i've got 60 seconds for three more stories we're going to get firings you up today. 700%, that's how much spending on school administration k through 12 has gone up in the past 50 years, are we getting our money's worth from the
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administrators, is that spending helping students? we'll deal with it. we'll also talk to a small business owner who says she will take a hit from obamacare because she has one too many employees. and if you miss what google decided to celebrate on its home page yesterday, easter sunday, we will show you. here is a hint, it wasn't easter. and back to the markets and the price of oil. $96 a barrel this morning and that's down almost a buck. you don't typically social mcdonald's with a healthy diet, but according to the fast food chain's chief nutritionist mcdonald's is healthy. really? dr. marc siegel weighs in on that and he's next. (announcer) at scottrade, our clients trade and invest exactly how they want. with scottrade's online banking, i get one view of my bank and brokerage accounts with one login... to easily move my money when i need to. plus, when i call my local scottrade office, i can talk to someone who knows how i trade.
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how old is the oldest person you've known? we gave people a sticker and had them show . we learned a lot of us have known someone who's lived well into their 90s. and that's a great thing. but even though we're living longer, one thing that hasn't changed: the official retirement age. ♪ the question is how do you make sure you have the money you need to enjoy all of these years. ♪
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. . stuart: it was a turn around. we opened lower and now on the verge of 14,600. buy something, somebody, it will hit 14-6 almost. is the fast food the at
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mcdonald's good for you? that's what their director of nutrition is claiming. talking about the mcwrap. she said it's possible to eat from the recommended food groups when visiting mcdonald's, it's about choice, customization and looking at the calories on the menu board. dr. marc siegel is here. hold on, conveningal wisdom is mcdonald's is not good food, it's bad for you, but you went out there and talked to the nutritionist, did she convince you that mcdonald's isn't bad? >> i not only talked to her, but the head chef at the olympics at the time in london and i was impressed with both of them. and i feel she's making an attempt to put things of nutritional value on the menu and everybody laughs at it. but they put apples into the happy meals, eating apples is better than french fries and now mcwraps with cucumbers in them.
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and coming out with an egg white delight. and they have to play to their audience, what should people do. mcdonald's told me that they had a veggie burger on the menu for over a year and i said that sounds great. what happened to it. >> they said nobody bought it. nobody bought it. nobody bought it we have to have it on the menu. they're a company trying to sell products like everybody else. stuart: if mcdonald's is moving to more nutritional food and you say they are. >> yes, they are. >> are they responding to pressure from the government and the food police saying you've got to do this, do this, do this? and are they on that side of the pressure or what the marketplace wants? >> i think it's number two. i think they're responding to what the marketplace wants. mcdonald's is big enough so that they don't have to respond to the food police per se. there's no regulations that are forcing them to do this, it's the idea that people themselves are becoming more health conscious. i love that idea. it's interesting to see demographically where they sell more of this stuff. probably in california more than
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here in new york, but i think it's a very good sign that the market is going in that direction. stuart: i don't want to go off on a side track here, but it seems to me, just an observer, that there's almost a class thing about obesity, that poorer people tend to be more overweight than wealthier people. is that accurate? >> yes, that's actually been studied and it is accurate. now, there's two reasons for that. stuart: mcdonald's is blamed to that. relatively cheap, available to poor people and they overeat at mcdonald's and that's the logic and train of thought. >> there's plenty of unhealthy food on the mcdonald's menu. i don't blame mcdonald's, they're respond to go an audience and sometimes for poorer people that's all they can afford to buy or in the habit of doing. you and i were talking before we came on that maybe having it occasionally, you know, isn't the most unhealthy thing. i've taken the road trips and
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driving along, need a cup of coffee, see the mcdonald's arches and stop. if you didn't find them, what happened then, could you get into a car accident. they're not without some value, but i definitely think you went off on the other topic and we're definitely too sedentary a society and bad eating habits. i just don't happen to blame mcdonald's for it. >> look, we were talking during the break there. i've got a large family and back in the day we'd take a road trip, pile into the van and off we'd go 0 florida or something like that. it's very convenient to stop at mcdonald on the way down to florida. the kid know the menu and they want to eat at mcdonald's. my point is, you do it every day, obviously, you've got a problem. i think if you do it twice a month there's nothing wrong with that. what say you? >> i agree. now, my wife when we make the stops, have the fruit salad or the fruit salad. >> and kids, eat the salad?
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not going to happen. >> you're right, but kids more options than you used to be, a smoothy instead of a shake. there are more choices. stuart: is a smoothy better than a shake? >> yeah, the fruit smoothy, better than that shake. water is the best. stuart: and french fries in the car, can't beat that. >> hard to beat that. stuart: doctor, come again soon. >> thank you. stuart: time for the gold report. where are we starting a new quarter? are we at 1600. almost 1597 per ounce to be precise. how is this for a message for young college women, find your husband while you're still in school. that message got a lot of people, women especially, truly fired up. well, cheryl casone and liz mcdonald are here and you can bet they want to chime in on this one. watch out, boys. ♪ going to the chapel and we're gonna get married ♪
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>> as if there wasn't enough pressure in college already, princeton alumni susan patten is putting another. here is what she wrote. here is what nobody is telling you, find a husband on campus before you graduate. she goes on to say you will
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never again have this concentration of men worthy of you. liz, cheryl, welcome to "varney & company," i have nothing to say on this whatsoever. how do you want to start out, cheryl. >> as the only single person at the table, the point is there's a higher concentration of single available men on the college campus. stuart: so she's right. >> i think she's right and it's true. once you get into the work force and people get older you get more spread out biz yers, get distracted and people start to get married in their 20's and that's the point and she also talks about the fact that men want younger women and i think that was a little-- >> that's nonsense. liz, what do you have to say. >> i find it he entertainienter madmen circa 1955. and as princeton women, priced out of the market. what do princeton women go for?
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she's talking about diminishing returns. when you're a freshman you have a bigger gene pool you're swimming in, the longer you take there's less men to pick from. >> i'm not sure about the whole thing. stuart: ladies, you're totally-- >> i thought you had nothing to do about the topic? >> i have everything. college, especially a place like princeton is a fantastic marriage market. is it not? and buy your way? >> i'm not sure it is. >> i'm not sure what the new york city fire department would have to say about that. >> and as the only singer person at the table i would say, yes, i agree with that. because you're getting people educated and obviously have a good work ethic. they're there to learn and they've got goals, got dreams and it's more difficult to find those types of people that are-- quote, unquote, marriage qualified, if you will, standards, values, religion, et cetera, et cetera, as you, i think, get older. that's the point. she's talking to kids. stuart: what did you say about the new york city fire department? >> that has a wonderful group of
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men to choose from. by the way, with these women who pick their men in college you've got maybe what, how many years until you get divorced. don't mean to sound so cynical on a monday morning, but the divorce rate is 50%, isn't it. stuart: i think the divorce rate is going down. >> the divorce rate is-- >> around-- actually liz, the divorce rate is lower if you're college educated. >> still around 48%. stuart: okay, what about former colleagues used to be a regular on this program, tracy byrnes says i'm not sending my daughter to college to get married. anything to add. ten seconds. >> here, here, tracy byrnes. stuart: good subject for monday morning, april 1st. coming up new at 10, california is on the road to recovery and it's thanks to liberal tax and spend policies and the republicans in the state were the ones holding california back. i'm not making this up. no, a nobel prize winning economist no less wrote that, we are going to talk about it next.
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plus, wait for it, david stockman, doom and gloom himself, he says the market public is about to burst and we've got him. he's going to joining us in the studios moment tarm. momentarily. it's monday.
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stuart: economic policy writer, what he says has taken by gospel light big government, big taxing liberals. he says california is making a comeback. he said high taxes have restored
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the golden state financial status and says massive infrastructure programs will restore the california of old. to professor kruger, this is the result in liberal politics which can be pushed by the super majority in the state legislature. to him, tax and spend, that is the way to go. and that is what we want at the national level. interesting. massive debt, high unemployment, slow growth at the state and the national level and that is considered a success. very interesting also that despite all of this, the left wins the white house in all elections in california. very interesting. ♪ right up to the minute we are waiting for the federal reserve on whether or not stock in california file a bankruptcy. waiting to see if bondholders or pension holders or both could
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take a hit. this case could show if federal bankruptcy court trumps state law setting precedents above the states. liz macdonald on top of this one. here's my point, if he says yes, this is a bankruptcy situation, it is possible existing pension receivers could take a haircut and bondholders who have lent money to the city could also take a haircut, is that correct? >> it is correct. it is such an important fight happening right now. if stockton cuts the benefits in this bankruptcy basically also what could happen is by contrast california and could step in and take over the liabilities and say you owe us a lump sum to cover those unfunded liabilities. stuart: if it happens in
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stockton, there is a formal declaration of bankruptcy, the most accountable cities in america are facing a very similar situation. >liz: he was an enron consultant in '99, wrote a glowing article and he is saying california is out from under it. it is most unfunded government liability, triple the size of the next government, ohio. the jobless rate is so below, job creation lower than it was 10 years ago. stuart: the dow has turned negative, because we had this manufacturing number come out at the top of the hour. it was the weakest rating in that sector since last year, late last year. that turned the dollar round, 40-point reversal because of that week number from i s. m.
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manufacture. how much power does a bankruptcy judge have? who will talk to andrew napolitano about the stockton situation, how much power does a bankruptcy judge really have there? he will detail it all very clearly for us this morning. let's go back to paul krugman. more what he says. thanks in large part to the super majority of the state house and tax increases by governor jerry brown. we have a very special graphic for the policy on the left. there it is. your reaction. let's go to you, cheryl. i have made a mockery of this. is that california is not making a comeback, tax and spend is not the way to go, and you say? cheryl: i say you are absolutely right. the policy in california, this is why you have the governor of texas, rick perry, launching ads
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to get business to leave the state. you have dairy farmers, 12 other governors right now courting the dairy industry, no more happy cows because of regulation, high taxes, high cost, etc., etc. that is one specific example why the policies in california do not work. stuart: still a very high rate of unemployment in california. liz: it is worse than rhode island and nevada. stuart: you can say governor brown has brought it back. brought the state finances back to the block. so he says. cheryl: the problem is he is so misleading in what he obits. california state spending cuts have helped bring the budget back into fiscal balance even though a lot of tax hikes do. even the "l.a. times" has said california taxpayers owe wall street more than any other
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state per resident. and there is more spending on government worker benefits than all the other state programs combined. cheryl: i'm wonderful what they say about governor brown's policies in the education system in california. with students leaving. stuart: has it stopped in california? is there at least a modest turnaround? liz: no. cheryl: i would say there make efforts to get spending under control, but they are targeting the wrong areas in the budget to control that. stuart: no mention if they exploited the natural gas reserves. check the big board, down 13 points. we turned around on news of the manufacturing number which was disappointing.
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we turned to 25-point loss, now we're just down 11. so i'm calling this market are the much flat. to nicole. shares hitting a high, why is that? nicole: a multiyear high. good call from goldman sachs, upside potential. they raised it from a neutral, raising the price target to $62 up from $47, currently seeing a nice pop. stuart: i read an article recently that said the demand for beer in the united states globally with either flat or lower. hitting a new high. nicole: i read an article saying it was certainly picking up. i think the idea is earlier
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price target $47, so stocks sitting at 50, they have to make a call. do they like it, do they hate it. obviously they see the upside potential of beer regardless of the trend. stuart: the dow down eight points. 4570 is where we are. days of very sharp rhetoric. the u.s. is sending f-22 fighter jets in south korea to be on standby. nuclear missiles in recent days is what they have been saying. mike baker is with us now, former cia covert officer. a total outsider knowing nothing about the situation at all, seems like a lot of posturing, seems like there will not be shots fired in anger and if there is, it is total mistake in and not a factor in our
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financial markets. tell us what is going on. >> i think you nailed it. more than they have been in the relative recess. whether we're talking about the newest leader, or his father for the father before him. there tends to be dismantling of the favorite at some point generally because they're displeased with the amount of attention they are not getting on the world stage, the lack of respect, or the sanctions are doing so much damage perhaps that they're looking for some concession by being threatening in this manner. stuart: neither side is angling to start real trouble. the real trouble could start by
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something totally unforeseen. that is the real worry, isn't it? >> it is. something you cannot plan out on the game table. there is probably no better example of how things really don't change on the world stage than north korea. possibly afghanistan. but north korea has been going on for decades and decades. in a sense, we have a problem here because we don't understand the new leader particularly well. we don't understand his relationship with the military, and that is important. at this point we assume he has the support of the military. the military and north korea, china is a key player here.
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the only patron of north korea. the last thing they want to see is instability or chaos. stuart: mike baker, you know what you're talking about, thank you for being on. >> thank you. stuart: mccall, we have gained stuff. they are warning of week sales. nicole: they warned of weak sales. so they did was they lowered everybody's expectations. and then they came out with their quarterly report and pete the street. a quarterly report that exceeded the analyst estimates. they're talking positively about some things in the pipeline like the new microsoft game console. the new sony game console. have a feeling they will be on our holiday list november and december. the stock moves to a new annual%. stuart: thank you. spending on administrators at
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public schools has jumped 700%. over 50 years, but it is up 700%. all these administrators, what do they do? can you answer that question? what do they do? >> exactly. the amount of administrators and the public school system has increased 700% since 1950. the amount of teachers has only increased 252% while the amount of students has only increased 96%. so we are essentially spending three times more on public education than we were in 1970 hit test scores among students have remained stagnant and in some areas have even declined. stuart: is simply your putting a bureaucracy on top of the entire school system, but what do they
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do? >> exactly. what do these administrators do? they had to file paperwork, they are spending hours and hours filling out all the paperwork that goes along with the programs such as no child left behind. they are non-teachers, not involved with students, just filling out the paperwork coming with these so-called education programs. stuart: it is extraordinary. 700% increase. thank you for joining us, always a pleasure, thank you. the dow is up five. up 20, down 25, now we are up five. sometimes people say searching for direction. cheryl: you mentioned the dow was coming down, what about jobs
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coming out on friday? stuart: the whole week we have economic indicators, but here is the theory. if they are weak, the bank keeps on printing money. if they are strong, will b zero. cheryl: the feds gauge is the picture. the dow will go down. stuart: that is interesting. good stuff. ronald reagan predicts doom and gloom. but david stockman is not a fringe kind of a guy. you have to consider his arguments. we will do that next. [ indistinct shouting ]
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stuart: american greetings announced this morning they will take the company private. valued at $878 million. sending stocks spiking on the news up 12%. ebay expects a profit of $300 billion worth of global e-commerce by 2015. doubling the active users to 200 million. shares up four and a quarter percent. toys "r" us pulled the ipo friday changing leadership in the company and sales.
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online giants like amazon, wal-mart are really cutting into sales. coming up next i will have my take on david stockman. he is predicting dire doom and gloom in america. how about that. welcome to the new new york state. what's the "new" in the new new york? a new property tax cap... and the lowest middle class income tax rate in 60 years... and a billion dollars in tax breaks and incentives. new opportunities for business. over 250,000
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new private sector jobs were created over the last two years. and 17 straight months of job growth. with the most private sector jobs ever. lower taxes, new incentives, new jobs, now that's news. to grow or start your business in the new new york visit thenewny.com stuart: there are many people who i would say are on the fringe to predict gloom and
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doom. and now comes david stockman, successful banker connie cannot put him on the fringe. he has come out with a shocking prediction. first, what did he say? "within a few years this latest wall street bubble inflated by east creatures flood of pony money from the federal reserve will explode." and he says when it burst they will be no new round of bailouts. the united states is broke fiscally, morally, internationally. he ended his article with this. when the bubble pops, there will be nothing to stop the collapse. if this sounds like device to get out of that market and hide, it is. get it? he concludes for much of this time government has promised services it can pay for and propped up industries that are
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in terminal decline. the federal reserve pumped out an endless supply of dollars and corruption for the entire financial system. i bring this to your attention not because i necessarily agree with it, but the doom and gloom is coming from someone who is anything but fringe. he cannot be lumped in with those we think of as extremists. creditably the left is tearing into the man. they have poured on it with harsh language. but this guy has credibility reminding me of the people back in 2006 warning america was drowning in cheap money and lousy mortgage debt. didn't pay much attention back then. perhaps we should listen to him today. coming up in the studio next.
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stuart: joining us now, david stockman. causing a lot of buzz with the op-ed over the weekend. warning of a stock market bubble. this is what he said in the article. instead american will descend into an era of austerity and political conflict extinguishing
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even today's feeble remnants of economic growth. david stockman, that is very strong stuff, isn't it? >> we have to shed the bias that says what we have been doing for the last couple of years will take a little more time and recognized the trend. here's a trend, main street economy has been failing. stuart: failing in what sense? >> who created only 17,000 jobs per month since 2000. 17 per month, we need 150. real growth, less than 1% per year for 12 years. real income, down 25%. the main street economy is struggling. we have the fed bubble machine creating bubbles that essentially end up shooting the
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wealth and income in the top 1% and leaving everybody else behind. we have had two devastating collapses. ben bernanke reflects the bubble, all of this money is circulated into the canyons of wall street, does not go out, and it shouldn't. stuart: you say there's no way around it. there's nothing anybody can do about this. speak of the interest rate isn't a real green market, is pegged and medicated.
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the five-year rate, 10-year rate, all of the fast money traders trading against the fed. if you think they will change direction, that is why we in the mother of all trades. whether the smoke signals are real. stuart: don't hang around, basically get into cash. >> look in the history of the three bubbles we have been through, the buildup happens and it takes months and months and years, four years. this time is different, remember the goldilocks economy. and then when the bubble breaks and they can't stop it, you lose
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all of that within a matter of a few trading days or a few weeks. we learned that lesson, people got devastated because they couldn't get out of the way. when they finally get out of money but figured ben bernanke refighting the bubble so it is now lapped all the way through. stuart: you have credibility. you say get into cap. >> as a short-term bank deposits and trade securities because the capital market is entirely rigged, it is dangerous. stuart: how about gold? >> they are in a race to the bottom, but even gold is subject to the trading forces and the
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margin calls and all the speculation this, so i'm not even that confident about it. but what i do know is this market lives and dies by the fed, ben bernanke is the most dangerous man to ever hold high financial office in the history of the united states. liz: became a pretty strong in 2004, 15, 17% rate hike. can they do it again? and when do you see the bubble bursting, what time frame? >> they raised the rate 25 basis points, cooling the sub prime bubble because it drove the high yield great into the sub prime market and all of a sudden it has craters. it shouldn't create bubbles, pumping this.
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stuart: almost out of time. he says what you have written is old, cranky stuff. listen to rush limbaugh and if they are kept up, get emplacement two investment advice. sad is what he says. >> he was helping us with the tax, he was a pleasant, astute young man. something happened to him. apparently he has lost his way and changed his mind. stuart: what is the name of the book? >> "the great information." stuart: has it been published? >> yes. it is out today.
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what a pleasure. it is great to have you with us. how much power does a bankruptcy judge really have? change, modify or throw out existing contracts? that is what might happen in stockton, california. all rights, our own judges next.
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ally bank. your money needs an ally. stuart: today a judge will decide if stockton california will be allowed to file for bankruptcy. it could be if the judge determine who takes the losses, the bondholders for city worke workers, retired city workers, or maybe both. judge andrew napolitano is here to sort it all out. am i right? >> this is virgin legal territory. this california law prohibits municipality to seek bankruptcy. yes. the principle is federal bankruptcy law follows the law of the state. what will happen to the pension funds and who will be favored, the pensioner because it is exceptionally lucrative deals or
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the bondholders who lent money with obligation to pay back the debt. this is a different kind of bankruptcy. the people owed money cannot make a proposal to the city. the really tricky question is what happens to pension contributions that still need to be made. federal law prohibits interfering of those, california law which federal law supposed to follow seems to indicate there can be a major change. stuart: is that judge says you are now getting attention, your former city worker getting attention, it will be lowered. if the judge says that, a dozen california cities. >> that'll be the first time that has happened to pensioner
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in the united states of america. even o.j. simpson's pension was not reduced before he went to jail. stuart: that is the most important thing. >> what is the difference between having a bankrupt company went bankrupt city? you restructure. stuart: it ca>> it can raise mo. theoretically creditors are not touchable at bankruptcy, but this is different because this is a municipal government for the court can restructure all of the obligations, even obligations that it has agreed to specifically. that is what bankruptcy does. it restructures obligations.
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they think of the city as the landlord, if need more cash. the tenant would say to take a hike. it will cost twice as much if you stay there. stuart: i think if those pensioners get a haircut, it is probably the only hope california and other states restore fiscal sanity. >> if they get a haircut that will be only a united states court says yes, that is how precedent-setting this is. then you will see it popping up all over the place. stuart: yes, you will. >> the negotiated deals that were too good to be true. stuart: you make promises you cannot keep. >> it is making one that cannot be kept. stuart: judge, thank you very much. yet another unintended
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consequence of obamacare. small businesses struggling to comply with the law. we were told to make health care cheaper. our next guest say why hire more people of it will cost me a whole lot more money? maybe she can answer the question. roll it. >> have to pass the bill so you can find out what is in it, away from the fog of the controversy. friday night, buddy. you are gonna need a wingman. and my cash back keeps the party going.
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stuart: gas prices keep on falling ever so grimly. average is $3.53, down about $0.03 in a week. check the price of oil, $96 per barrel. maybe the lower gas prices have ended at $96 per barrel for oil. exxonmobil had a major boost from the all electric car. tesla's stock is up 16%. and then we have at&t announced it will start selling the kindle fire in stores on friday. they will receive a discount on the device, shares of at&t are up about 1%. the number out earlier, 51 was the reading, the lowest since november. bouncing back now it is down again. off 17 points. coming up, obamacare continues to hurt small business.
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stuart: try this number for size, $2 billion. that is how much money is wasted on unclaimed shipping refunds? our next guest can get that money back for your business. founder and chief executive of 71-pound, that is the name of the company. i am a business, i should stuff ups overnight. it does not get there overnight,
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i am due a refund, you get me that refund, right? how much do you take? >> typically 50%. stuart: you take half. so how do i get it? i signed up with you guys? >> we have no monthly fees, no sign-up fees, would take a service fee out of the refund. we automate the process and we do this for you. stuart: all you get is 50% of any refund due to me and i am wired up electronically with your software is anytime i'm supposed to get a refund, it is automatically paid because of your software. fedex and ups must hate you. >> we are not best friends, we are enemies. stuart: and you used to work for fedex. so you know how they work you created software to essentially take money off of them, didn't you? >> millions of small businesses
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would not get the refund, so we did it for them. hundreds of customers we have. stuart: hundreds? >> we are. stuart: you are a private company? >> we are. stuart: you wrote the software? >> we have people who wrote the software. five people. stuart: so you have five employees and that is it? >> we are expanding, doing this throughout the nation. stuart: you are into a great business. from 71-pound. i wish i could ask you how you got the name, but i'm going to shift topics totally. our next guest runs a bakery. under obamacare offering
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insurance for all of her employees or pay a fine. joining us now, rachel. welcome to the program. i believe you have 95 employees and you say obamacare will cut your profit in half? explain that for us, please. >> the way the law stands is small businesses are exempt. if they have 50 employees or less. those with employees more than 50 are required to provide health insurance or pay a penalty. now let me be clear because all people are going to be covered after january 1, it is just a matter of who pays for it. stuart: this is going to cut their profits in half when this goes through, right? >> it will cost a significant amount of money, $150,000 whether or not we provide insurance or pay the penalty. stuart: what are you going to do? >> i don't know, my employees
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will get health care, that a good thing, i am glad they will get coverage. whether or not we pay for it is irrelevant because they will get that. iit is sort of irrelevant. our competitors are not going to have to pay for it. stuart: because they have fewer than 50 employees? >> yes. we have worked long hours, we'll have our employees, but now two-point we are a little bit larger than most of our competitors because they have less than 50 employees they will not be required to provide that cost $150,000. stuart: i am jumping in because you don't know how much this insurance is going to cost that you have got to offer your employees because what is included in that coverage has not yet been firmly established. >> you are absolutely right in
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because it appears to be increasing even though the prices i'm looking at today are probably nothing we'll look at in a year. stuart: is there any chance politically obamacare will be rescinded or chopped and changed to the point where it is no longer a threat to your company? >> i think the train has left the station on that, i'm only hope at this point certain inequities can be addressed so we can be on an even playing field for just because my business is larger than another business that we are not unfairly disadvantaged because of that and we don't want to provide growth. stuart: has more than 50 employees, but your principal competitors have less than 50 employees so they are off the hook for this and that is a huge difference to you.
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i'm sorry i'm out of time, but thank you very much for bringing it to our attention. we appreciate that, thank you. >> thank you. stuart: a couple easter sunday stories that will get your attention including what google celebrated on its home page, that is next. power conmption, impact wool exports from new zealand, textile production in spain, and the use of medical technology in the u.s.? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper average. twe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. what's the "new" in thnew newn, risks, fyork?.d expenses a new property tax cap... and the lowest middle class income tax rate in 60 years...
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and a billion dollars in tax breaks and incentives. new opportunities for business. over 250,000 new private sector jobs were created over the last two years. and 17 straight months of job growth. with the most private sector jobs ever. lower taxes, new incentives, new jobs, now that's ns. to grow or start your business in the new new york visit thenewny.com try align. it's the number one ge recommended probiotic that helps maintain digestive balance. ♪ stay in the groove with align.
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stuart: not even the holiest day on the christian calendar is safe from beltway politics. they suggest the views are contrary to the teachings of jesus. i think you have more on what the pastor said at the service. liz: he says it drives me crazy when the captains of religious rights are always calling us back in the back of the bus. i don't know anybody who said that. stuart: captains of the religious right: 4 blocks to be at the back of the bus and women to be in the kitchen. liz: he also tied it to jesus saying these captains have to let go, but i don't know if
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anyone who has ever said that. stuart: this is a sermon from the church in our nations capital to the president of the united states on easter sunday. that is politics, which i don't agree with, frankly. and that is on people who are conservative because i don't know anybody who thinks blacks should be at the back of the bus. liz: i don't know of anybody saying that right now. stuart: google taking backlash over the doodle yesterday honoring cesar chavez. instead of celebrating easter, there is some outrage from some conservative politicians and christians. google doesn't normally honor easter anyway. i am not outraged. >> they are based in the san francisco bay area, cesar chavez himself a pillar of california, 86th birthday, that
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is fine, see why they did it because of where they are based. he is a man in san francisco in particular considered a hero and a leader. the hispanic population, etc., etc. they are a private company, they can do whatever they want. it is being misinterpreted to something that is anti-easter or something. stuart: i agree entirely. it is not anti-easter because he put a different doodle on. liz: i am struck by how many people thought it was hugo chavez. stuart: oh, dear. "the highlight reel." don't miss it. because it is next.vz÷
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stuart: roll the highlight reel. we are heading for the biggest crash of them all. >> the main street economy is struggling. this market live and die by the last word of the fed. the people of the fed have no idea what they are doing. >> think he is the dangerous man to ever hold financial office in the history of the united states. stuart: interesting words. liz: he should know. he worked at blackstone. he has been involved in that.
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stuart: the man is talking seriou adoom and gloom. he is talking collapse. sandra: ip makes very good points about death of capitalism in this country. i would have asked him that you cannot tell me the world will stop profiting because the united states of america has a spending problem. stuart: you cannot believe that brazil, for example, will go up. how could they? sandra: i think it is a little far off. a little doom and gloom not.
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stuart: he says get into cash. i asked him about gold and he said maybe his day is about to come. that was remarkable stuff. to me, when i read that yesterday morning, i read it first thing yesterday morning, my jaw dropped. liz: both sides of the political aisle. stuart: he is an equal opportunity critic. sandra: hopefully we listen to him. stuart: connell, it is all doors. thank you, stuart. we h m

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