Skip to main content

tv   Squawk on the Street  CNBC  December 30, 2013 9:00am-12:01pm EST

9:00 am
bonds and short duration bonds. >> just like they said? >> that's correct. >> david? >> happy new year. >> you packed that all in. >> ten more things to say. any resolutions? >> my new year's resolution is to spend more time with my kids and grandkids and follow your lead, you and andrew. >> thank you, david. >> we have to run. make sure you join us tomorrow, "squawk on the street" begins next. thank you. good monday morning. welcome to "squawk on the street." i'm carl quintanilla with simon hox and david faber. cramer is off today. down to the final two trading sessions of the year. after a 4% move higher, futures are essentially flat, gaping a little momentum here at around 9:00 a.m. eastern. the ten-year note is just a touch below 3%. a lot of data coming in this week, including isn, okay
9:01 am
shiller and auto sales. the nikkei closed up 56%. the best performance in 41 years. this final shortened trading week, all the major indices coming off big gains last week. as we look back on this great year for the equity markets, did 2003 end up stealing gains from 2014. we'll take a closer look. >> but this year was not a good one for gold. the precious metal having its worst year in more than three decades breaking a 12-year winning streak. >> google and apple are expanding their fight for tech supremacy to a new front behind the wheel of your car. >> i want to welcome dan joining us for the entire hour. the reason we did play fish at the top of the show. it is great to have you this morning. >> you have actually written a lot over the weekend about the rally that we are seeing and whether or not it is pulling forward some momentum from 2014. >> this is one of the biggest concerns that market participants have now, the end
9:02 am
of year rally has been stronger than normal. as such, you are borrowing from 2014. all i did this weekend was take a look at other strong quarters going back 20, 30 years. there doesn't appear to be any meaningful correlation between strength in the fourth quarter and what happens next year. the real indices is valuation. >> you believe the economics are game changing. we have changed our perception of growth coming into the year? >> no doubt about that. next year, assuming we don't have an earthquake in japan or another arab spring or oil strike, there is no doubt growth will be better next year than we have seen in a few years. we expect gdp to be somewhere around 2.7. strength is always at the end of the year. gdp should be printing up in the 3s. third quarter and fourth quarter
9:03 am
growth, while not perfect was also quite robust. it seems the acceleration is happening. >> a few conversations i have had with people over the last few days, there seems to be this emerging playbook that i wonder if it will be proved incorrect. part of the next year will be pretty good. we don't worry about rates. they won't rise too much. we are going to have to start to worry. we may see a strong first quarter followed by weakness. i don't know whether that will, in fact, prove the case. because people are believing that will be the case, it will prove not to be. what about rates? they are very, very low. they may be just going to very low. >> listen, again, the strongest period for the market from a seasonal standpoint is the winter and the winter for the end and the beginning of the year, strongest six months of the market. it is always safe to assume end of year strength persists into the beginning of the new year. then, you have a spring swoon. something we have seen the last couple of years.
9:04 am
the issue you on rates, as rates drift higher. we should be so lucky they do over the course of the year, there is going to be a level that proves problematic for the economy and the stock market. i'm not sure it is 3 or 3.5. i would remind our rviewers, th year on the ten-year was routinely 3.5%, as high as 4%. growth rates were stronger at the beginning than they were with lower yield. i'm not one of the people that fears higher yields. growth in the previous expansion was pretty good when the ten-year was yielding 4, 4.5%. i'm not so sure things are so different we can't handle that. the degree of the speed at which we achieve the higher yields is more important than the yields themselves. >> for equity investors, that might become more attractive. if you look at barclay, goldman
9:05 am
and citi, suggesting the stock market could rise 3% next year, you have to wonder what the conversation is behind closed doors that they come out with that sort of benchmark, surely. >> i feel very strongly from a valuation perspective, a forward return perspective, stocks are not nearly as attractive entering 2014 as they were entering 2012 or 2013. there is little doubt about that at this time. the issue becomes from a rotation standpoint, a positioning standpoint, does a higher ten-year draw investors away from let's say the utilities or the telecoms. i own at&t. full disclosure. the stock is basically flat on the year. >> 5.4%. i'm just taking a look at the numbers here. in 2005 and 2006, when yields were going higher, when the stock market was going higher, the utility sector outperformed the s&p 500 in both years. i don't know the types of investors that we have shoved into the utility space and the
9:06 am
telecom space are as mobile as perhaps people think. they might be stickier. in which case, the yield on at&t at 5.5% is fine, even though the return is flat, because it is a bondlike investor and my mom or grandmother are happy getting 5.5% with flat capital return because it is a safe stock. a 3% ten-year is not as threatening as we would like it to be. >> as they now know. we are going to get someday ta at the top. if we are going to get these back to back gdp gains as long as they might be, do you think ism might be the king for the week? >> it is the oldest and the gold standard so to speak indicator with respect to the stock market. we have data going back into the 40s. the manufacturing sector is not what it was. it is still one of the key indicators. the levels at which they are printdi prin
9:07 am
printing upwards, 55, 56, 57. you are seeing people take up their gdp forecast. >> i want to move on to apple. apple is recommending that shareholders vote against carl icahn's $50 million buyback poe posele. proposal. that was announced last april. if you recall, mr. icahn is taking a sizeable dollar position. $150 million buyback to be funded in the debt market. now, changed to the proposal he is offering up over this fiscal year that will end next fall. the company saying we are already in the midst of returning a great deal of money to shareholders. remember our huge bond deal where we borrowed $17 billion. that was the low tick, i think,
9:08 am
if i recall. the question here is, how much will icahn fight. he is up, i believe, in the position its sechlt hitself. he is good at sort of finding a rock rolling down the hill and hitting it at the right moment. it is not clear to me that rock is rolling down the hill any longer. many would argue that, in fact, they should be returning even more capital. what do they need all of that cash for, not that it is here in the states as they point out in their opposition to the proposal. it is overseas. that said, nonetheless, they will generate perhaps as much as $60 billion in this coming calendar year. do they really need all that money? >> their defense is we pay one of the biggest dividend payer in the world, the largest authorization in history in terms of buybacks. how much of a defense is that when you have a company that size with the market cap that size, with cash flow that size.
9:09 am
>> if you look at the six-month chart, it is a phenomenal performance. since we hit 390, you have a 41% gain that's come through. the situation for tim cook surely has changed somewhat. >> it has. in this case, it may be that icahn does not win his argument but he wins as an investor. he did get in. i don't know what his average price is. we do know he has benefited from that gain you pointed out. the key for apple seems to miwa we've talked about so often here with jim and others, which is, what are they going to come out with next year. is it going to continue to be upgrades or something that really moves it forward in terms of a tv product. apple in cooperation with audy rolling out services that let's
9:10 am
you get information and entertainment. we talk about the battle for the living room. >> it is becoming the ultimate mobile device. whether android becomes the car in the future. if apple does a deal with audi, do you have to have an apple phone to drive the car? >> these are the things that are going to drive apple. my company has a buy rating on the stock. the icahn thing is important, the stock buyback is important. they have a ton of cash parked jae overseas. what turned the stock around was forward earnings expectation, the china mobile deal. when investors were soaring on the stock, it was because earnings were coming down. as soon as that trend reversed, the stock trend reversed. it may not be an imminent boost or technological release. that will help drive sales and the stock higher.
9:11 am
>> watch google and apple battle it out is also interesting and fun to watch as they pick various points where they choose to battle, the car being one of them. >> particularly they both have a robotics operation. >> when you get a self-driving car, what's the embedded software that is going to operate it. it could be android operated. google has the self-driving car. apple does not. copper rising to its highest level in more than four months. what does that mean for the economy and the rest of the market? we will decipher the moves and the commodities in another few moments. the dow has had a record close 50 times this year. a lot more "squawk on the street" from post 9 in just a moment. just by talking to a helmet. it grabbed the patient's record before we even picked him up. it found out the doctor we needed was at st. anne's. wiggle your toes. [ driver ] and it got his okay on treatment from miles away.
9:12 am
it even pulled strings with the stoplights. my ambulance talks with smoke alarms and pilots and stadiums. but, of course, it's a good listener too. [ female announcer ] today cisco is connecting the internet of everything. so everything works like never before.
9:13 am
we do? i took the trash out. i know. and thank you so much for that. i think we should get a medicare supplement insurance plan. right now? [ male announcer ] whether you're new to medicare or not, you may know it only covers about 80% of your part b medical expenses. it's up to you to pay the difference. so think about an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. like all standardized medicare supplement insurance plans, they help cover some of what medicare doesn't pay and could really save you in out-of-pocket medical costs. call now. with a medicare supplement plan, you'll be able to stay with your doctor. oh, you know, i love that guy. mm-hmm. [ male announcer ] these types of plans let you visit any doctor or hospital that accepts medicare patients.
9:14 am
and there are no networks. you do your push-ups today? prepare to be amazed. [ male announcer ] don't wait. call today to request your free decision guide and find the aarp medicare supplement plan to go the distance with you. go long. you don't need me to tell you it has been a rough year for goechltd the metal having the worst year in over 30 years. let's bring in jim smith. >> let's start with something that's working. in particular, natural gas, which has had this phenomenal rally during the course of the yoors. the best performing commodity. do you think it has bottomed or could it reverse back down as we saw in 2012? >> i think we still have some
9:15 am
upside with natural gas. the weather is going to be cold. fabulous weather in chicago. the average temperature for the next seven days is going to be a whopping zero. plenty of natural gas used. i would begin to worry about natural gas as we start to move out towards february. when it starts to warm up, we are going to see natural gas come back under some pressure. we certainly have the capacity to recall what we have drawn down. we have awfully cold weather in a lot of places and that's going to continue. that's going to be supportive for natural gas. what do you think will work best next year? >> i think you have to look for commodities that have very weak fundamentals. you are going to have a problem really. you have to do things that are doing well, cocoa has very good fundamentals. that is probably the only market that does. i really don't like gold here at
9:16 am
all. >> did you mention gold, sterling. would that be bullion? >> i do not like gold here. at the moment, i think gold is hanging on to the 1200 level for dear life. if we see any sort of problem come up that disrupts the tapering or anything like that, we could easily see gold bounce a little bit. i think overall, gold is going to trade below $1,000. >> we talk about the apparel makers all the time. it has been a while since we were talking about them in reference to rising cotton prices. you think cotton has horrible fundamentals. all you have to do is look at where global stocks are. we have three times what global stocks normally are. china has a huge stockpile. as long as you have that situation, it is going to be very hard to sustain higher prices. if you look at the weak corn and soybean prices, cotton is going
9:17 am
to garner acres from the second crop and more here in north america. with that, you are going to have more product coming on the market. this funds bizarre affection of cotton is probably going to come to an end. we could see cotton becoming an underperformer. sterling, thank you very much for your time. sterling smith joining us there from chicago. dozens of people were killed and injured in a suicide blast on a trolley blast in russia. this is the country's third deadly attack in four days. jim maceda is live in moscow with the latest. good morning. >> reporter: hi, carl. a state of emergency has been called in volgograd. they have issued a statement that said this morning's bomb was carried out by a mail suicide bomber.
9:18 am
people were going to work or the marketplace at the time the bomber struck. a whole city of 1 million is terrified. there are reports out of volgograd that residents are staying inside. they are too afraid to go about their daily lives. the strong suspicion is this was the work from islamic insurgents. police are already calling these latest attacks acts of terror. they are connecting them both to a public appeal that was made several months ago by doku, omarof, on the u.s. list of terrorists. he appealed to his own men to disrupt the winter olympics. vladimir has staked a lot of money and his reputation on. he has deployed 40,000 army, police and agents are going to
9:19 am
be surrounding sochi, making it safe. he has created a kind of ft. knox. in fact, it is like a new country. 1500 square miles large. no vehicles will be allowed in, nor will you be allowed in either, carl, unless you have a special olympics passport. security will be incredibly tight in sochi. security experts like to point out, if there is a dramatic attack that brings the country down or the infrastructure, it won't happen in sochi. it will happen in places like moscow or st. petersburg and soft targets like volgograd. >> still, chilling news, 38 days away from opening ceremonies. jim maceda in moscow. two days left to trade in 2013. what should you be doing with your money? the one and only art cashin will weigh in in a moment? we are going to get data.
9:20 am
ok case-shiller and chicago pmi next in just a moment. bny mellon turns insights like these into powerful investment strategies. for a university endowment. it funds a marine biologist... who studies the peruvian anchovy. invested in the world. bny mellon.
9:21 am
9:22 am
let's bring in arthur cashin, director of floor operations at u.s. financial service. also, a poet of sort is art with his annual poem on the year. hitting things as diverse as paula dean and hannah montana, to esther williams and edy gourmet. not many can get it in one poem.
9:23 am
>> takes a heap of living and a lot of marinading to keep that together. >> the ten-year and the market itself as we head into next year. we were talking to dan about both. what are you looking for in this last two days of trading before the new year begins? >> historically, they are spotty. going into the new year, things could be strong. remember, 2013. one of the strongest performances in the first couple of days. you might see people preloading iras, preloading pension funds and other things and jumping in in the first couple of days. we are already overextended to some degree. >> why is that? >> the run-up of the market away from some of the moving averages and a variety of other things, it has been a heck of a run. it probably is time for a rest. given the seasonality, the
9:24 am
conventional wisdom, i think, is that you'll stay relatively strong going into around the 10th or 15th of january and then you might see a correction. >> what should we make of rates as we head into next year? we are right around 3%. we had this conversation and will be having it very often. most people think, we are going from very, very low to very low. not to paraphrase dan earlier, don't be too concerned. it hasn't played out badly in the past when we have seen higher rates as long as we get higher gdp growth. >> dan and i disagree very slightly. i don't think you can compare it to other normal recoveries. this has been driven purely by low rates. the telling area will not be how the market reacts to a 3.0, 5%, but more importantly, will it continue to weigh on mortgage applications. they have dropped down to a
9:25 am
level now when lehman was still alive. that's going to be a bit of a problem. look at this week and the week that follows. >> can i just double back? you mentioned the possibility of a correction in the middle of january. how big do you this i that correction will be? >> if we keep moving at this pace, it could be anywhere from 3% to 5%. we'll see. >> the disaster. >> i don't think so. geopolitics are beginning to heat up. we see russia. this thing in turkey cob a real incendiary event if it goes out of hand. over the last couple of years, when you drift that far away from the 200-day, it suggests you are one month or so forward returns are not all that attractive. you do trade laterally or correct some of that. >> my only point is, it has been written about on the web.
9:26 am
your reference to miley cyrus sperking. i didn't realize it went that fark. >> i referred to her in her other fashion as hannah montana. the best line on that i think was brook shields who played the mother said, where did i go so wrong? >> we are talking about her on "squawk box." on squawk on the streets. maybe she is doing something right. >> indeed. >> despite all that, i wish the viewers a very happy new year. >> we got the opening bell just a few minutes away. get ready. another big day of trading. not many more left in 2013. "squawk on the street" will be here all the time. en drive"
9:27 am
sales event is back.
9:28 am
which means it's never been easier to get a new 2014 jetta. it gets an impressive 34 highway mpg and comes with no charge scheduled maintenance. and right now you can drive one home for practically just your signature. sign. then drive. get zero due at signing, zero down, zero deposit, and zero first month's payment on any new 2014 volkswagen. hurry, this offer ends january 2nd. visit vwdealer.com today so i got the windows nokia tablet. it's, well, impressive. it's got the brightest hd screen, super-fast 4g lte, so my son can play games and movies almost anywhere, and it's got office for school stuff. but the best part? i got the lumia 928 for my daughter for free, with the best low-light smartphone camera this side of the north pole. dad for the win. mm! mm! mm! ♪ honestly, i want to see you be brave ♪ became big business overnight?
9:29 am
♪ like, really big... then expanded? ♪ or their new product tanked? ♪ or not? what if they embrace new technology instead? ♪ imagine a company's future with the future of trading. company profile. a research tool on thinkorswim. from td ameritrade. you're watching cnbc "squawk on the street" live from the financial capital of the world on this ultimate trading session of 2013, today and tomorrow. then, of course, stocks closed on wednesday, back for thursday and friday. a fair amount of data came in today pending homes and case shiller and chicago pmi tomorrow. putting the year-end into some
9:30 am
perspective, in 2013, half of the dow and s&p, all-time highs. virtually half of all components, the blue chips and the s&p. there is the opening bell. a look at the s&p. here are the big boards, the atlanta company, a manufacturer of generic pharmaceuticals. providing assistance to military families. some of the year-end stats are pretty astounding. your call for next year is what, 1980? >> 1980 or so, that's correct. >> an 8% gain? >> we also initiated a price target like many wall street strategists. this has been such an enormous run. a couple of websites have pointed out that some have seen their six-month price targets hit in two or three months time. it has been to some degree
9:31 am
concerning to some. that is something to pay attention to obviously. >> one name that's going to get some action and some relatively thin trades is crocs. this $200 million investment from black stone stocks was up in the pre-market. do we know much about this. >> we know. a convertible preferred. obviously, we will give them the opportunity to be exercised at a higher price. crocs is going to use it to buy back more stock. they have a ceo that will step down in the not too distant future. they are having a hard time fashionwise. they were hot and then they were not. >> that's what you do in this environment. no matter what, you buy back your own stock, $350 million. i have written an op ed about this today. the ceos have spent about half a trillion in the year from october buying back their own stock. for every $2 the fed prints, ceos are spending $1 to buy back
9:32 am
their own stock, one reason the stock market has done so well and another reason it is rising in equality. don't forget, bill de blasio will be sworn in on wednesday as the new may yoer of new yoor of. >> we are seeing a continuation of this, would you call it a minicrash in twitter yet? i'm not sure. twitter was down about 2%, 4% in the market. it looked like at the time, guys, it was going to last through year-end. >> 55 to 73 in a very short amount of time. about the amount of days i took off. since i have been back, it has gone down. we have sat here many times and talked about the incredible multiple to revenues. you can't do a multiple earnings at this point given there aren't any. $1.2 billion in fiscal year '14. revenues expected.
9:33 am
you are still talking about a 30 plus multiple to sales in 14. that being said, certainly plenty of excitement about what this company is going to be able to do and the growth that it offers and what it may become. >> so much of the market is sitting on cash, $1.8 billion of cash unused in the moment in corporate balance sheets. >> a lot of it overseas. these guys are investing and they offer shareholder's growth. you have to make a decision on value at some point. they are desperate for a story that cob tuld be the story of 2. >> good for them. they have a good economics program up there in the high school. come on. >> here is the issue. >> a neutral on twitter, a buy on facebook. this has taken hold in a lot of these social media names. it really got ahead of even
9:34 am
accelerated fundamentals and the issue going to the end have o the year, whether they are going to book profits in the space. when we look at twitter, it boils down to momentum. it has become detached. to a large degree. our price target is down in the 30s. when you start talking about price to sales, it is hard not to reminisce about that. >> i hear myself talking that way sometimes. i remember speaking that way about amazon. of course, that was wrong. you should not have. you could have always questioned the value. you can 300 times earning. but it was not a smart move to sell that stock. >> no, and it has not been for years. i don't follow amazon in a specific space. people talk about that stock as not making money. amazon can make money tomorrow if they wanted. they choose to reinvest so much of their funds. i remember a time in amazon when people were counting up all the books in the world and making some sort of comparison there.
9:35 am
smart people that did not fully understand that he always intended to offer everything. somehow it didn't really compute at 1998 and 1999. that he was going to be offering a store that offered everything as opposed to just books. >> take a look at disney. upgraded the buy over at guggenheim. they are raising the price target talking about the company being posed to celebrate in 2014. coke getting some nice comments from barons over the weekend talking about rational pricing returning to the market. the payout on some of those names doing okay. it might be interesting to watch some discounters as the unemployment benefits end. that's money that tends to get spent relatively quickly, those benefits. there is some talk it might shave off 0.4 off gdp. there is little doubt that when you provide money to people with
9:36 am
less money, they tend to spend it more quickly, a multiplier. the issue surrounding unemployment benefits at this point really boils down to the political. is this something you want to be spending money on? it boils down to the economics. the cost of $1.3 million. it is about $1.2 billion. in an environment where the fed is still printing $85 billion in the same month. one benefits the top of society. one benefits the bottom. >> let me take the other side. does two wrongs make a right? if you believe the fed is contributing to inequality by driving up stock prices, do you compensate for that by, "a," ceasing that program or comp compensating the lower income. >> it is dangerous. they don't care whether it is the fed or the government. this is a very dangerous
9:37 am
situation. this is a very dangerous rally for this economy z . to make it a bill de blasio. i will echo whether anthony weiner's demise sucked the air out of the christine quinn run. the main thing was built around stop and frisk, not necessarily inequality. >> it is going to be very interesting to see his economic program and negotiations with the union. before we get to bob, let me hit a couple of deal-related stocks. a deal that didn't happen and another up because there is a deal that perhaps may happen. start with cooper tires, ctb, the stock is down about 2.5%. it was last june.
9:38 am
in a highly leveled transaction buying cooper. it was on the rocks when they wanted to renegotiate the deals. trouble with a joint deal in china. union issues. they have called it all off. the financing went away. this was not a surprise. hence, you have already seen the big move down. you can see it there in that stock. finally, did want to come to sprint if we can. it was up 8%, 9%. very little float on sprint. it is controlled by softbank. that continued speck about, will 2014 bring a deal or an attempted deal between sprint and t-mobile? it will certainly help with sprint shares that have been off to the races even since that deal. we will see about t-mobile, yes. talk, yes. does it mean there will be a deal? no, not at this point.
9:39 am
it is 2014 business early on if they can get them to agree to give it a shot. >> dow is up almost eight points. let's get to pisani on the floor. happy monday. the dow is up by the s&p and nasdaq are to the down side. gold stocks, a lag guaard. twitter is to the down side. facebook is down, yelp is down. linked in is down. nonetheless, big story. we are sitting near essentially new highs on the s&p 500. the vicks x is 12. all that concern about hitting 3% on the ten-year hasn't materialized. i was out thursday and friday. the traders were bombarding me with comments pro and con. bears are saying it is not affecting the market. higher rates will start affecting the markets in january
9:40 am
and february. a large part of the group i talked to think that higher rates are coming and that the markets may be able to handle it, because the economy is improving. now, 4% is the new line in the sand. a lot of people saying we are unlikely to go to 4% unless there is very clear evidence the economy is notably improving. what is very clear about 2013, this was the teflon year for the stock market. all the disasters predicted. none brought the market down. we had the fiscal cliff, the sequester, the taper, syria, the government shutdown. only the concerns in the middle of the year halted the market and that was only for a short period of time. my vote was central bankers of the world should be the person of the year on the "time" magazine cover. i think that's very important overall. also, you were wondering about the effect of higher rates on some of the interest rate
9:41 am
sensitive sectors. the s&p has been up since the taper was announced. housing has been very strong since that. utilities have been a little bit underperforming. japanese stocks closed the year last night, best year since 1972. look at this. japan is up 57%. china was actually to the down side and one key point, guys, that i toss back to you. mutual fund flows were huge into japan this year. they accounted for a very large part of the overall inflows into stock mutual funds. u.s. had only modest inflows in to u.s. centric stock funds. back to you guys. >> thanks very much, bob. let's head over to rick santelli at the sme group in chicago. two-day charter tells you everything you need to know. we finally, finally had our 3% handle on the close on friday. boy, it was just barely, open the chart up. you can see going back to july
9:42 am
of 2011 where we are comping. it is as important to look at the other maturities on the yield curve. we haven't quite taken out our high fall levels. this settled at 72 basis points. it was down before the big rise had occurred in march. let's look at a 30 year to date. this closed at 295. it is currently at 392. the ten-year has the biggest net change on the year. it closed at 175 at the end of last year. let's change gears to where it is all happening. that's in the foreign exchange market. we closed a whisker under we are definitely higher on the year
9:43 am
considering where this is trading. the pound closed around 162.5. the big boy, the dollar yen, this is key, the dollar is up about 20%. it really explains why the dollar index is still holding slightly above unchanged on the year. >> it's been a banner year for stock. billing names more than doubling at 2013. twitter, as we said earlier, losing as much as 7% after a down grade on friday. twitter is now down 21% from its intra-day high of 74, 73. we will talk to the analyst who made that call about why he thought the stock had gone too far when we come back. ♪ i wanna spread a little love this year ♪ [ male announcer ] this december, experience the gift of true artistry and some of the best offers of the year at the lexus december to remember sales event. this is the pursuit of perfection.
9:44 am
at the lexus december to remember sales event. and it feels like your lifeate revolves around your symptoms, ask your gastroenterologist about humira adalimumab. humira has been proven to work for adults who have tried other medications but still experience the symptoms of moderate to severe crohn's disease. in clinical studies, the majority of patients on humira saw significant symptom relief, and many achieved remission. humira can lower your ability to fight infections, including tuberculosis. serious, sometimes fatal events, such as infections, lymphoma, or other types of cancer, have happened. blood, liver and nervous system problems, serious allergic reactions, and new or worsening heart failure have occurred. before starting humira, your doctor should test you for tb. ask your doctor if you live in or have been to a region where certain fungal infections are common. tell your doctor if you have had tb, hepatitis b, are prone to infections, or have symptoms such as fever, fatigue, cough, or sores. you should not start humira if you have any kind of infection. ask your gastroenterologist about humira today. remission is possible.
9:45 am
[ male announcer ] here's a question for you: the energy in one gallon of gas is also enough to keep your smartphone running for how long? 30 days? 300 days? 3,000 days? the answer is... 3,000 days. because of gasoline's high energy density, your car doesn't have to carry as much fuel compared to other energy sources. take the energy quiz. energy lives here. there's nothing like being your own boss! and my customers are really liking your flat rate shipping. fedex one rate. really makes my life easier. maybe a promotion is in order.
9:46 am
good news. i got a new title. and a raise? management couldn't make that happen. [ male announcer ] introducing fedex one rate. simple, flat rate shipping with the reliability of fedex. welcome back to "squawk on the street." i'm jackie deangeles reporting from the nymex. watching brent futures, just above 111. traders are pretty tensive with a shortened week of trade. events in washington, yes, we have a budget deal. they are worried a little bit
9:47 am
about the debt ceiling. they are also saying they are wondering what will happen with equities when the calendar flips to 2014. of course, at the same time, we are watching some of those issues impacting goald as well. a rough year for gold. it's worst in 30 years. we are hovering above the 1200 mark. trade certificates also saying watch the dollar very closely. we are down a little bit today, not seeing a boost for crude or for gold. that 80 handle very critical. >> we're looking at names of stocks that have gone up 100%, 200%, 300% in the past year.
9:48 am
there are 30 names that made the cut, yahoo! facebook, up over 100% this past year. biotech, also a major outperformer, gilead sciences, celgene, and deckers, the parent company of uggs and pitney bowes and r.r. donnelly making the 100% club. eight of them are up 200% in the past year. momentum up. netflix, micron technology, tesla, you can't count out brick-and-mortar retail. best buy up more than 240% in the past year. as for whether we are going to see more gains from these stocks, mixed picture. half of the names on our list actually had already hit analyst price targets when it comes to what their stock price could be. if the analysts are right,
9:49 am
perhaps limited up-side. we did find a few exceptions, delta airlines being one of them. analysts predict they could see a 20% pop over the next 12 months if they hit the average price targets. tune in to the halftime report. at halftime, we are going to be talking about the 400% club. five names that have hit more than 400% gains this year alone. back to you. >> thank you so much, sheila. let's turn dan on that note. some of the momentum fliers that have doubled, tripled, quadrupled, are those easy shorts? >> for a stock like a best buy, for instance, where there has been a fundamental change of investor confidence around the stock, just because the calendar changes from december 31st to january 31st, doesn't mean the
9:50 am
the these s thesis behind the stocks will change. clearly, investor enthusiasm has driven market multiples up in the bio-space in particular to higher levels than they have been. does the calendar change negate the thesis that has driven higher? >> there is an article in the journal today that noted the shift from chasing dividend to the lower price earnings ratio. they suggest the hundred stocks in the s&p 500 rose 41% this year. the market overall rose 29%. what happens to that these sis. >> i'm an invefstor, over time, the less you pay for $1 of earnings, the greater the longer term. with respect to the dividend argument, i am looking at the best performance here.
9:51 am
names like best buy and my kron all don't have attractive dividends. . what does work is dividend increases. they are increase shall the ratio over times. a lot of these names that were cheap are not as cheap. next year, what you want to do in theory is look at the new names that are still cheap. less now than they were before. it can still be done. >> retailers depend heavily on the holiday shopping season to carry them into the new year. who is set to hit the ground running in 2014? we'll get you the retail playbook up next. ladies, listen up. our own josh lipton is looking for love. he has taken to online dating to find the future mrs. lipton. there's a new form of innovation taking shape.
9:52 am
9:53 am
9:54 am
at a company that's bringing media and technology together. next is every second of nbcuniversal's coverage 0f the 2014 olympic winter games. it's connecting over one million low-income americans to broadband internet at home. it's a place named one america's most veteran friendly employers. next is information and entertainment in ways you never thought possible. welcome to what's next. comcastnbcuniversal. some analyst say successful retailers in the holiday season tend to outperform in the next
9:55 am
year. >> simon, as we take a look at what's happening, a lot of retailer outperformers. the consumer discretionary stocks are the single best performing sector. since black friday, they have done pretty well. other names, other stocks individually have been some real outperformers. foot locker is up about 5% since this time frame. you have another big outdoor company. underarmor up 7%. apparel, doing really well. shoes doing really well. cabelas, if you are into hunting and fishing, another one, the finish line, they sell shoes as well. all of these stocks have done very well so far. how do they tend to do over the next month, in january. over the past three years, these companies did pretty well as well. cabelas up 14%.
9:56 am
underarm mer up 3%. down about 1% overall. if you are looking for where the retail outperformers could be. they tend to outperform in january if they do do well over the course of the holiday shopping season. where you want to look is in outdoor nand athletic performance, that's one area you could see some real outperformance from retail to google, to luxury cars, at ces, google is expected to announce they are working with audi to develop android-ba android-based, in-car entertainment systems. next time, you will be glad you have google in your car because, why? tweet us at "squawk on the street." you immediately start thinking of safety concerns. people looking down from their windshield. >> maybe they are wearing google
9:57 am
glasses. >> so much goes back to the mapping technology. such a key part of so many of the navigation systems where all of this started in the smart car. >> presumably, siri will drive the car. >> dan, thanks for being with us. hope you will come back at 11:00 if you are free. when we come back, why one u.s. congressman thinks amazon's drones are a huge privacy concern. breaking news on the housing market when we are back in a few minutes. any other way. any other way. but your erectile dysfunction - it could be a question of blood flow. cialis tadalafil for daily use helps you be ready anytime the moment's right. you can be more confident in your ability to be ready. and the same cialis is the only daily ed tablet approved to treat ed and symptoms of bph, like needing to go frequently or urgently. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex.
9:58 am
do not take cialis if you take nitrates for chest pain, as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, get medical help right away for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or any allergic reactions like rash, hives, swelling of the lips, tongue or throat, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. ask your doctor about experiencing cialis for daily use and a free 30-tablet trial. ♪ [ male announcer ] the parking lot helps by letting us know who's coming. the carts keep everyone on the right track. the power tools introduce themselves. all the bits and bulbs keep themselves stocked. and the doors even handle the checkout so we can work on that thing that's stuck in the thing. [ female announcer ] today, cisco is connecting the internet of everything.
9:59 am
so everyone goes home happy. at bny mellon, our business is investments. [ female announcer ] today, cisco is connecting the internet of everything. managing them, moving them, making them work. we oversee 20% of the world's financial assets. and that gives us scale and insight no one else has. investment management combined with investment servicing. bringing the power of investments to people's lives. invested in the world. bny mellon.
10:00 am
welcome back. november, month over month pending home sales are up 0.2%. if it was negative, it would have been the six negative month over month change in a row. the last positive was in may right as interest rates were moving higher. if we look at year over year, it was down 4%. that is much worse than expected. even that 0.2 that was positive month over month, it is a fraction of the 1% expected. here is the fly in the ointment.
10:01 am
month over month was originally released in october. 2.2 was minused on year over year. these numbers are nothing to brag about. carl, back to you. the ten-year yield, the 2.5 below 3%. eric san anton eric stein, you are the fixed income guy here, correct? >> yes. >> what a lot of people want to know is how rapidly do you think interest rates are going to rise next year? >> i don't think rates will go up that rapidly, just because i don't think we have enough growth or inflation in the
10:02 am
economy to make them go up that fast. i also think the fed, while they are okay if rates go up slowly, they don't want them to go up that fast. i expect to see them higher, but not massively higher. >> is there a point at which the yield rises at a level to which it is attractive, freshly attractive to people and they buy treasuries stabilizing the mood. >> from a u.s. inspector perspective, i believe japanese investors get nothing on jgb. their currency is weakening. when everybody talks, who is going to buy the treasury. japanese investors at some point will be the first to come back into the treasury market. >> surely, there are higher interest rates for them to take up around the world than here in the united states. >> there are but i think they like the safety of u.s. treasuries. the yen has been weakening
10:03 am
against the dollar. it is better than 1.5% we were at a year or so ago. japanese investors cob the stabilizing force in the treasury market. >> eric marshall. eric stein, is the nikkei a big reversal in 2014. that's the one index that has closed up shop for the year. 57%, all the economics aside, how much longer can that go on? >> eric marshall, why don't you answer that. >> we don't pay a lot of the attention to the nikkei. here in the u.s., we still see u.s. stocks as attractively valued. as we entered this year, everyone was very skeptical about corporate profit margins holding up and could you see further earnings, multiple expansion. we definitely got both, both improving corporate earnings and multiple expansion, which really drove stock prices this year beyond what most had expected. we think in 2014, going forward,
10:04 am
stocks are still very attractive relative to bonds. but we think you are really going to have to focus on individual company fundamentals and be a little bit more of a stock picker in the year ahead. >> eric marshall, let me stay with you. small caps are where you focus. they don't always perform the way large cap growth does. what does history tell us, if anything, after a year we have seen like this one. i think it tells you that in the lat later stages of any market, active portfolio management does better than passive strategy. you have to focus on companies almost as if you are a private equity investor in the public markets. within the small cap space, you can find dynamic pockets of growth. you can find companies that can do well regardless of what is
10:05 am
happening in the broader market. >> do you think that will make a difference when momentum is the be all and the end all? >> if you look at active strategies versus passive strategies, you see that the coupling. we basically have proven that at the hodges fund. we have done much better than our benchmarks over the last five years. in this environment, this creates opportunities for stock pickers. >> eric stein tells us that the crisis is not over in european. there is no immediate rate to cut rates further. what if he has to start raising rates in 2014, does european start going through some convulsions. i don't think he is going to have to raise rates. i think, if anything, given the strength in the euro and the pressure we have seen in some core european bond markets, when they move up in yields, they are
10:06 am
going to have to be more aggressive to do something they have been reluctant to do so far. that is quan tay tititative eas. eric marshall and eric stein. let's get to russia this morning. these two suicide bombings within 24 hours killed dozens of people in the city of volgagrad highlighting a major security threat six weeks before the winter olympics. jim, good morning, once again. >> hi again, carl. president putin has reacted to these series of bombings by calling for the beefing up yet again of more russian security throughout the country. security experts tell us he has tried that before after such similar bombings to very little effect. meanwhile, russian officials have declared a state of emergency in volgograd formerly
10:07 am
stalingrad. the latest bombing was kcarried out by a male suicide bomber. the whole city of 1 million plus are paralyzed. people won't go outside an won't go about their daily lives through fear. the strong suspicion of course is that this was the work of islamist insurgents. police now are saying that not only do they call it acts of terror. we have it unofficially between the two latest bombings and both of those bombings related to a public appeal, if you recall, made several months ago, about i the cseh shan leader, doku osmarlof that was appealing them to disturb the winter olympics.
10:08 am
president putin has staked his reputation and future on that and has put 40,000 agents around sochi to keep the games safe. >> if, in fact, putin can fortify sochi further before the games, to what percent are the transportation hubs still a target. >> that's ex athly the issue. he can fortify sochi as much as he pleases. weekend soft targets like volgogvolgo volgogad or st. petersburg or moscow, to get the same effect which at the end of the day is to scare people and shut down the security infrastructure by having russian security running and trying to guess where the
10:09 am
next attack will occur. so, yes, if you look at sochi now, it looks like a ft. knox. it is a 1500 square miles of security zone. no vehicles are going to be allowed in or out, nor will people be allowed in or out without a special pass. it is almost like a new country being formed within russia. will it have any kind of lasting effect on these attacks? experts tell us it is not likely. >> our thanks to you, jim. we've seen a reversal in twitter this morning. the stock falling after that big rally a few days ago continuing to drop from friday. part of that came after a downgrade to underperform. we're going to talk to the analysts who made that call in just a minute. [ male announcer ] here's a question for you:
10:10 am
where does the united states get most of its energy? is it africa? the middle east? canada? or the u.s.? the answer is... the u.s. ♪ most of america's energy comes from right here at home. take the energy quiz. energy lives here.
10:11 am
10:12 am
shares of twitter getting hit again. friday's fall was attributed to a down grade. the recent surge was not justified. ben schachter is the analyst with macquarie. you think you topticked this thing? >> i think we have. we provided the catalyst to
10:13 am
bring them back down to earth. >> what if it falls back, do you think you can go to a neutral within a couple of weeks? >> our job is to call it as we see it. we have a value of $45 a share. if it got down to an opportunity people could make money, that's our job. >> there are presumably so many unanswered questions. i would examine it becomes almost binary on the evaluation moving forward. >> i wouldn't say buy nainary b is very early stages. we think it is a fantastically run company, a bright future. this was simply a call that the stock had risen way too fast, too far.
10:14 am
there are just too many unknown things so far. one of them being getting the revenue per user, two levels that are akin to facebook. how long will that take? >> if you look at this company, there are only about 2500 people there? it takes time and people to execute. it is putting it in context. they have half number people that facebook has. and less than knifive that goog has. those things matter when you are trying to execute against all the things they have. >> your sense they are not going to allow a profit to accumulate any time in the next fiscal year. >> they are clearly in investment mode now. the biggest problem they have right now is prioritizing which way they are going to go and trying to figure out what they should execute against. each of the things take time and people. we think they have a lot of opportunities ahead of them, a
10:15 am
bright future but the stock just got ahead of itself. >> how torn are the barriers to entry here. could there be another twitter? could people switch or is twitter what it is and it will always be? >> i think it is way too early it will always be. i've been doing this for a long time now. we've seen these stories run out in the past. geocities came and friendster and myspace. it is not like these will go away like friendster did tomorrow. >> can you argue, for example, that facebook has critical mass, because it is so large? there are so many using it, where as twitter so far has not. i think that's fair. >> if you look at myspace where it never got critical mass beyond the younger demographic. when the young people left, they all followed quickly.
10:16 am
if young people leave facebook, doesn't mean everybody else will leave as quickly. it is more uncertain. i think that should be reflected in the discount rate when you are trying to figure out the value of the shares. >> you mentioned some names that were a blast from the past. this movement in twitter is certainly reminiscent of the late '90s that brings to mind that conversation about a bubble overall. what are your thoughts? >> in general, i have been telling folks, i don't think we are in a bubble. i was hear for the last bubble. it is a very different time. real businesses, real money. there are some things that are bubbleesque and do remind me of it. when i start to look at some of the advertising i see across facebook, google and many others, i start to see a lot of companies that are cash flow negative, trying to get to the next group of funding. they are going after users.
10:17 am
there are some advertising dollars that are here at risk. i heard someone today talking about facebook, talking about yogi berra, no one goes there anymore, it is just too crowded. do you think facebook has come of age? >> it is one of the things, when your parents are on, you don't want to be on. i think people are experimenting and looking at other areas. facebook is such a broad demographic, such a massive scale of people, it is not going to go anywhere any time soon. i had to remind myself of world population figures. you very quickly got to more people. they are a massive company at a scale that twitter is not very
10:18 am
close to yet. >> ben schachter over at mack quarry. facebook up up 200%, almost 300% this year. house of cards taking home the first emmy for a web series. our own julia boorstin on reed hastings, one of the most influential people of 2013. >> reporter: in 2013, reed hastings proved a try iconic class, redefining the nature of television, with original, exclusive shoes, streamed over the internet, starting with house of cards that debuted in february ahorror thriller and orange is the new black in july, a comedy thriller. these are the very first shows made exclusively for internet
10:19 am
distribution. to compete for critical acclaim, viewers and emmy's, along with hbo and showtime. >> this is how hbo started too. it was just other people's movies and then they expanded into amazing originals. we look at them for inspiration and say, what can we do on the internet that's even more than hbo? >> growing to more than 40 million subscribers at the end of the third quarter, up from 33 million at the end of 2012, sending the stocks soaring well over 300% this year, quite the turn around after hastings executed one of the worst p.r.s when he split netflix streaming and dvd rentals effectively doubling prices, a plan he abandoned aft backlash. >> we want to do great things. occasionally, if you swing, you are going to strikeout.
10:20 am
>> hastings hasn't just hit a home run in business but overalled communications with shareholders to have an analyst and a reporter, yours truly, ask questions sent in by investors. he has pushed for regulatory change about what qualifies as public disclosure. after revealing netflix streaming numbers to his facebook followers, an sec inquiry counts as public commentary. >> going wide with facebook, they have a public mode that i use going to hundreds of thousands of subscribers, is very much in the interest of the little investor. >> now, with plans to keep investing in original con tente and overseas expansion, we will see if hastings continues to dpli deliver to investors. >> let's send it to dominic chu. >> this is falling out of bed.
10:21 am
if you look at myriad genetics, they would get a cut for the key breast cancer test. they are cutting rates and targets citing worries that doctors would be pushed to use cheaper kind of tests. >> it has not been the best year for president obama. legislation on immigration an gun control seems stalled in congress. the rollout of obama care some calling a debacle. we will take a closer look when "squawk on the street" comes back.
10:22 am
10:23 am
so, how do you feel about cash back? i would not say i'm into it. but let's see where this goes. [ buzzer ] do you like to travel? i'm all about "free" travel, babe. that's what i do. [ buzzer ] balance transfers -- you up for that? well -- unh. too soon? [ female announcer ] fortunately, there's an easier way, with creditcards.com. compare hundreds of cards from every major bank and find the one that's right for you. creditcards.com. it's simple. search, compare, and apply. [ ice rattles ] search, compare, and apply. fifteen minutes could save you fifteen percent or more on
10:24 am
car insurance. yeah. everybody knows that. did you know there is an oldest trick in the book? what? trick number one. look-est over there. ha ha. made-est thou look. so end-eth the trick. hey.... yes.... geico. fifteen minutes could save you... well, you know. clearly, a challenging year for the white house from health
10:25 am
care glitches to controversy surrounding the national health agency. the president ends with lows. let's check on john's prediction. he predicted that tax reform was unlikely to happen. that's correct. it hasn't moved in either the house or senate. prediction two from john, immigration reform likely to pass. that's not true. it has passed by the senate but hasn't within addressed by the house as yet. john predicted there would be modest gun control steps and those would be likely to pass. newtown was the big issue then. this is incorrect. no new laws were passed on either chamber. on all of the issues that john approached, the correct answer was to say, no, it wouldn't get through. here is john's look at 2014. think of 2014 as a year of
10:26 am
diminished expectations and you will see the pattern in my predictions for the next 12 months. start with a budget where republicans and democrats have struck a deal replacing parts of the budget sequester with savings they like better. look for them in early 2014 to follow up with spending bills to throw scraps to defense and domestic priorities congress has neglected but make little fundamental change. they will avoid another government shutdown and another debt crisis. been there, already burned by that. the obama administration will grind along to the end next spring of signups for the troubled new health care exchanges that americans without insurance must buy from. >> even if enrollment comes up short of the 7 million person goal, white house allies will sign up enough young people to keep the financial challenges for 2014. obama care will have health problems but get a chance to
10:27 am
survive and grow. voters will go to the poll for another round of mid-term elections. republicans will hold the majority in the house. democrats in the senate. then, the status quo will start limping along to 2013. 2016. john joins us from washington. let's talk about obamacare first of all. how successful or unsuccessful is that now perceived on capitol hill? >> it is generally perceived as unsi unsuccessful. we have seen according to the white house that 2 million people have signed up for private plans through the exchanges. that's not the 7 billion they want to get by the end of march. they have three more months to do it. certainly, the website is better. the interest is there. the question is, whether they convert that and build enough confidence this is something they want to be a part of and avoid that individual penalty
10:28 am
people are subjected to if they don't have insurance. >> you know better than i, with lower expectations of the number of people joining the scheme, it doesn't push them down and work in the same way it is supposed to. it is a ship that is only half floating in many senses. >> the question is, what is the mix of people in the exchanges? they can be financially viable at smaller levels if you have the right mix of healthy and less healthy people. that's what makes it work actuarially for insurance companies. we don't know whether young and old, sick and well, whether they are enrolling in the portions that will make it work. that's going to determine how viable those exchanges are for 2015. >> to what degree is the far right, the tea party a factor, specially in the primaries? >> they are a factor. a diminishing factor, i would say. you are going to see it probably
10:29 am
more heavily be influenced during those primary seasons. mitch mcconnell has a primary. john cornyn has a primary from an incumbent member in congress in texas. they have been successful in the past. they think they are losing a little bit of their steam. the chances are that you could get some action in the congress on things like immigration, which was my prediction last year. the house hasn't acted yet. they still might. >> that was my question. you get an incompetent on that. nothing unifies business more than it's being infavor favor immigration. republicans have a strong self-interest in making it happen. that is principally at the national level. the kind of people that worry about republican presidential fortunes know this needs to happen. that is less relevant in the house. everybody worries about their own district. there is a chance that it
10:30 am
happens this year. if it doesn't, it will happen sooner or later. how many more elections are republicans going to have to lose before it does. >> i don't think john called shanahan getting fired. >> a year ago, i didn't. a week ago, i did. >> thanks, john. john harwood in washington today. the smart car era is almost here. according to reports, google expected to announce it is working with audi to develop in-car entertainment and information systems next week. what would google in your car actually look like? >> we'll talk about that in a moment. we're asking you the next time you are on a long road trip, you will be glad to have google in your car because, why? tweet us at "squawk on the street" and we'll get your answers. bines investment management & investment servicing, giving us unique insights which help us attract the industry's brightest minds who create powerful strategies for a country's investments
10:31 am
which are used to build new schools to build more bright minds. invested in the world. bny mellon. everything looking good. ♪ velocity 1,200 feet per second. [ man #2 ] your looking great to us, eagle. ♪ 2,000 feet. still looking very good. 1,400 feet. ♪ [ male announcer ] funny thing happens when you shoot for the moon. ahh, that's affirmative. [ male announcer ] you get there. you're a go for landing, over. [ male announcer ] the all new cadillac cts, the 2014 motor trend car of the year. i was going to the library to do my homework.
10:32 am
it took a lot of juggling to keep it all together. for some low-income families, having broadband internet is a faraway dream. so we created internet essentials, america's largest low-cost internet adoption program.
10:33 am
having the internet at home means she has to go no further than the kitchen table to do her homework. now, more than one million americans have been connected at home. it makes it so much better to do homework, when you're at home. welcome to what's next. comcastnbcuniversal. good morning. we're just over an hour into trade here. 10: 10: 10:33 on the east coast, 7:33 on the west. tim cook is giving up shares tied to performance because of apple's lost stock value earlier in the year. plus, black stone is cutting crocs a $250 million check. he will get two seats on the board. crocs also announcing its ceo
10:34 am
will step down at the end of april. it just got a lot more expensive to be rich in france. the socialist government has had a new law require millionaires pay 50% on all wages. the next battle between apple and google, who gets to call shotgun in your car. google and audi will announce they are working together to develop in-car information systems developed on android. is the car becoming the ultimate mobile device? lance u len off is editor in chief and john ford joins us as well. lance, what do you make of this. who do you think is leading ahead of the other? >> it is hard to say. we have all these great touch
10:35 am
screens to do so much. even though apple unveiled for cars last year, it has been a slow road. it is nowhere near ubiquity. it is kind of an even game at this point. >> you know who is really in the lead? blackberry with the 2 x operating system. they are in a bunch of cars already. they got overtaken. it is likely to happen again this time. john chen is going to try to make sure it doesn't. >> lance, are we going to be wowed by ces or is this going to be like, with he know this is early days? >> i think it will be early days. the car manufacturers, they have these long lead times. probably some models you can sit inside. they will show you what's going to p ha. it is not going to be, oh, and starting january 30th, or whatever, you are going to have one of these cars pop your
10:36 am
iphone 5s in there and off you go with google voice and all of that technology. by the way, one thing to keep in mind, if you have all that entertainment in the car, you need more than one screen. you need screens on the back seats for your passengers to enjoy whatever google is going to provide. >> spoken as someone with kids obviously. >> to what degree is this a component story? >> screens are probably the primary component here that's interesting. think about it from google's perspective. the car is one of those motherlode locations. if you know what car people are driving, how long, how old the car is, think about the value of that from a connecting point? >> google will know where i have been as well as who i have e-mailed. >> let's try and draw similarities to operating systems in hand sets.
10:37 am
these automotive manufacturers are a bit like nokia. did they nail their colors to the mass? they have to have their own operating systems. do they have to talk to each other? you have blue tooth technology, which works fine for that. it is really a question of interfaces and not so much the ios, the subsystem, what people don't care about. people have been using these screen systems, have flooded the market. what they have found is sometimes they are overly complex. the more you add, the tougher it begins for people to navigate them. they are starting to simplify them. whatever you can get through apple, google, voice driven, super simple. they are going to constantly remind people, we are not distracting them, we are not distracting them, we are not distracting them. >> take me out a few years then.
10:38 am
five years from now, what can i expect then? whether is is android or apple or blackberry. that seems to be a stretch. they have to make every car ios and android compatible. you don't want to be in a situation where you don't buy a car because you have the galaxy. they are going to start off with simple stuff, like navigation, music, already in the car. rather than having it up on the windshield, we are making it safer. >> do you think the automakers charge extra for these products or does an dridroid want to bri people into the ecosystem and subsidize it. everything is an up-sell. if you want the ultimate package, you are going to pay a little bit more. it is not going to be a big cost.
10:39 am
google will do whatever they can to get people excited about this. going into the dealership asking by the way, does it have the google in-car package. >> i hope it can park cars. the american public. >> lance, thanks for coming by. my pleasure. >> let's send it over to dominic include and get a market flash. >> like we have been saying, shares of cooper tire are down in training because it is abandoning a deal to be bought by india's apollo tire. they are out with their response voicing disappointment cooper is prematurely trying to terminate the merger. they say cooper's action leaves no choice but to pursue legal recourse. it sounds like the drama will continue. after major credit card hacks and the disclosure by edward snowden, privacy concerns are one of the top issues for many people headed into the new
10:40 am
year. what can we expect in the world of privacy and technology, we will ask the chief privacy officer at mcafee in a few moments. we'll be right back. [ male announcer ] this december, experience the gift of unsurpassed craftsmanship and some of the best offers of the year at the lexus december to remember sales event. this is the pursuit of perfection. so i got the windows nokia tablet. it's, well, impressive. it's got the brightest hd screen, super-fast 4g lte, so my son can play games and movies almost anywhere, and it's got office for school stuff. but the best part? i got the lumia 928 for my daughter for free, with the best low-light smartphone camera this side of the north pole. dad for the win. mm! mm! mm! ♪ honestly, i want to see you be brave ♪
10:41 am
and it feels like your lifeate revolves around your symptoms, ask your gastroenterologist about humira adalimumab. humira has been proven to work for adults who have tried other medications but still experience the symptoms of moderate to severe crohn's disease. in clinical studies, the majority of patients on humira saw significant symptom relief, and many achieved remission. humira can lower your ability to fight infections, including tuberculosis. serious, sometimes fatal events, such as infections, lymphoma, or other types of cancer, have happened. blood, liver and nervous system problems, serious allergic reactions, and new or worsening heart failure have occurred. before starting humira, your doctor should test you for tb. ask your doctor if you live in or have been to a region where certain fungal infections are common. tell your doctor if you have had tb, hepatitis b, are prone to infections, or have symptoms such as fever, fatigue, cough, or sores.
10:42 am
you should not start humira if you have any kind of infection. ask your gastroenterologist about humira today. remission is possible. there's nothing like being your own boss! and my customers are really liking your flat rate shipping. fedex one rate. really makes my life easier. maybe a promotion is in order. good news. i got a new title. and a raise? management couldn't make that happen. [ male announcer ] introducing fedex one rate. simple, flat rate shipping with the reliability of fedex.
10:43 am
>> santelli at the exchange live from chicago. morning, rick. we have november pending home sales today. i would like to do a quick postmortem on it. it is very important. what we learned today is we did not have a sixth month over month negative change in a row. but, if we look at the aggregate levels for a moment, the aggregate level right now, and this is seasonally adjusted, 101.7. for october, last look, it was 101.5. that was the lowest read of the year. because it goes back to december of last year when it was 101.3. if we just look at the month over month data on the surface, we received an up 0.2.
10:44 am
what was the high watermark month over month change of the year, it was in may, when it was up close to six. why is this so significant. the ongoing discussions are and today may be not a good example. if i look at what's going on in fives, hovering at 172, tens at 298. they haven't changed in an hour ond two minutes. they are locked and loaded. a passive last week for treasuries even though we did get the 3% clothes. this means the market can totally handle 3%. there is some truth to that. it isn't about one point in time. it is about a longer threshold of time. when you look at housing, specially the may read being the high watermark when interest rates made their big rate of change run for the year for many years, it shows you how important it is as these things filter through. we all know that housing boasted gdp for the year. so it really then becomes an
10:45 am
argument about the escape hatch. i can't tell you how long equities will run. i can tell you everybody is celebrating the nikkei. a 16,000 handle is really swar have had by a 39, almost 40,000 handle when they last topped out. nasdaq, almost doubled in the five months before it crashed. now, the u.s. equity markets and deep global may go on and on and on. but, when it finally does come to where the music is slowing down, the escape hatch is what we have to consider in the grander context. there is going to be a lot of professionals who really think they can dance between the raindrops. the problem is the escape hatch is going to more likely be like a funnel. there are going to i at be a lot go in but only so many are going to make it. the best hedge against that happening is, guess what, being long if treasuries.
10:46 am
simon, carl, back to you. >> thank you so much, rick santelli, in chicago. amazon's drone reveal was probably one of the biggest surprises in tech this year. despite all the excitement, lawmakers are still concerned about the privacy applications of thousands of delivery drones. well talk to congressman adam schiff in just eight moment.
10:47 am
the ocean gets warmer. the peruvian anchovy harvest suffers. it raises the price of fishmeal, cattle feed and beef. bny mellon turns insights like these into powerful investment strategies. for a university endowment. it funds a marine biologist... who studies the peruvian anchovy. invested in the world. bny mellon.
10:48 am
to get your best night's sleep [woman] aevery night.t's like [announcer] why not talk to someone who's sleeping on the most highly recommended bed in america? [woman] ask me about my tempur-pedic. [man] ask me how fast i fall asleep. [woman] ask me about staying asleep. [announcer] tempur-pedic owners are more satisfied than owners of any traditional mattress brand. tempur-pedic. the most highly recommended bed in america. save up to $300 on select mattresses during the tempur-pedic model closeout event. find a store at tempurpedic.com. at a company that's bringing media and technology together. next is every second of nbcuniversal's coverage 0f the 2014 olympic winter games. it's connecting over one million low-income americans to broadband internet at home. it's a place named one america's most veteran friendly employers. next is information and entertainment
10:49 am
in ways you never thought possible. welcome to what's next. comcastnbcuniversal. as we reflect on 2013, it was a big year for tech. the surprise came from amazon after they announced they were testing delivery drugs. some see it as a delivery method of the future. others and some lawmakers are expressing privacy concerns. joining us now is representative adam schiff, a democratic congressman from california, sounding the alarm on drugs. welcome to the program, congressman. what in particular worries you? >> first of all, i wouldn't rule out the use of drones as one of the technologies in the future. it has a lot of potential. people are very concerned and rightly so that drones delivering packages or drones that might be doing residential security may be armed with video cameras in the case of amazon.
10:50 am
i don't know what their technology will hold. you can imagine cameras as a collision avoidance system or in the event a drone causes a car accident or some other injury, amazon might very well want a w place and that's going to raise all kind of privacy concerns for people whose houses and yards and personal space is going to be invaded by these drones delivering packages to neighbors. one particular other concern that quickly is that, we have to look at what's the right agency to set the privacy rules for these drones. right out in the faa's looking into it but i've worked a lot with faa, and this is not part of their culture. they're very much about controlling airspace, not so much looking into privacy interests of those on the ground. >> congressman, it's safe to say, there's going to be a great deal of debate about privacy overall in the country in coming years but i'm not sure it's focused on drones and far from
10:51 am
clear that amazon's going to rule out the use of drones. we'll see, may have been nothing more than a publicity stunt, in many ways. what about the here and now? google knowing everything i'm looking at or searching for, apple knowing if i have an iphone, where i am, what i'm doing, amazon knowing if i am reading a kindle, where i start, mouch i do. there's privacy here and now that you can argue is intrusive and the beginning of a surveillance society. >> you're absolutely right. and these companies that you mentioned are a very difficult position. on the one hand, when it comes to government surveillance, and all of the issues involving nsa, they need to protect their international business model and potential customer, that's a great problem for them. at the same time, when they raise the alarms about what the fost government's doing, it's hard to avoid the finger pointed at them because they use so much of their users' information for marketing purposes. so they're walking affine line.
10:52 am
but even beyond that, for example, there are cameras set up by many municipalities that want to give you a speeding ticket. those cameras measure every time a certain license plate goes by a certain intersection. there is a database that knows where you've been in your car, whether speeding or not, and that's of concern to a lot of people. absolutely right, the technologies, as they progress, are just multiplying ex exponentially private interests. >> you can buy a recreational drone today, attach a gopro, take pictures of your neighbor's house, i could do it as soon as i'm done with the show. are they proactive or retroactive? >> we have to be proactive. the paparazzi, it not hard to imagine their use of drones to invade people's privacy, it will
10:53 am
go far beyond using a telephoto lens from a couple of blocks away. we'll try to be proactive, but as the government operates very slowly, it's reactive to nature. trying trying to get ahead of the commercialization of drones. one of my colleagues, ed markey, has introduced legislation requiring development of privacy regulations. we're try to be proactive. >> don't you sit on the house permanent select committee on intelligence? >> yes, i sure do. >> while you have given us a lecture about privacy, for the general economy, presumably you have signed off on, behind closed doors work of nsa which was so clearly -- >> i signed off on the nra. >> with the nsa. it's an important point because snowden, this year, has clearly demonstrated the government is acutely watching many of the things that they do in recording
10:54 am
phone records. do you not see asymmetry with all of the things you said in the bulk of the interview you sit on the committee and that's the situation? >> absolutely. we've got our work to do and many of us have been proposing a vast array of reform measures. i've been proposing, for example, the restructuring of the metadata program that collects vast millions of domestic calling records so that the government doesn't gain possession of those records. i've also advocated phiza court reforms. there are intersecting challenges as well. i mentioned the challenges facing the world because there's an overlap between challenges in the nsa world where their business model overseas is implicated but their own business models at home rely on the marketing of the personal data. they're going to have responsibilities just as we in
10:55 am
the public sector have responsibility to protect privacy as we protect the national security and as they advance their business interests. >> congressman, thank you for sparing the time to join us. have a peaceful new year, sir. >> thank you. you, too. >> adam schiff, democrat from california. thank you. >> could you use a little lipton in your life? our own josh lipton, of course. new year's is the busiest time of year for online dating. so josh, right there trying his hand at finding love online. will he find his soul mate on the world wide web? you have to stay tuned to find out. 0
10:56 am
10:57 am
that's a good thing, but it doesn't cover everything. only about 80% of your part b medical expenses. the rest is up to you. so consider an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. like all standardized medicare supplement insurance plans, they could save you in out-of-pocket medical costs. call today to request a free decision guide. with these types of plans, you'll be able to visit any doctor or hospital that accepts medicare patients... plus, there are no networks, and virtually no referrals needed. join the millions who have already enrolled in the only medicare supplement insurance plans endorsed by aarp... and provided by unitedhealthcare insurance company, which has over 30 years of experience behind it. with all the good years ahead,
10:58 am
look for the experience and commitment to go the distance with you. call now to request your free decision guide. we wanted to mention that we reached out to amazon if they wanted to comment on privacy concerns around the potential drones and they declined to comment. days running up to new year's eve can be the busiest time of year for dating services. the new trend is smartphone dating apps. who bettor cover this story than san jose's most eligible bachelor, our own technology correspondent, josh lipton. good morning.
10:59 am
>> reporter: good morning. if you don't have a date for new year's eve, don't worry. try going online. you will not be alone. getting a date is big business. matchmaking market is worth north of $2 billion. that's according to ibis world. a lot of singles getting ready for the ball to drop, go online to find a date, match.com, eharmony, okay cupid. 11% of internet users have used an online dating site according to the pew research center. newest entries into the world of romance are smartphone apps, let's date, zeus, expected to go public next year. zeus has 25 million active users and a top 20 app in the apple app store. the president says mobile's a bigger part of his business, as members message each other throughout the day on their smartphones, they're not tied to pcs any longer. now, it's not to say online
11:00 am
dating is per peck. in that same poll, conducted by pew research, half of online daters felt someone else seriously misrepresenting themselves in the profile. analysts say the market's poised for strong growth with revenues expected to double to $500 million. most americans still find their new year's date and partners off-line but increasingly, all that's needed is a picture, profile, and a smartphone. >> people on twitter saying i'll bet josh lipton loved the segment. they'll demand closure on the story. tell us what happens afterwards. >> reporter: a responsible reporter i started investigating, a downloaded on my app, i thought it was efficient and easy. maybe mrs. lipton is on here. >> you'll find out, josh. thanks so much. we can't all have those stories. >> we should have that on the cnbc app and they can match
11:01 am
bulls with bears, i don't know how it works. >> dow's up only two points. what you missed if you're joining us. >> welcome to "squawk on the street." here's what's happened so far. >> individual mandate was not necessary and it's probably a big political thing and it's going -- that is going to hurt democrats because people don't like to be told to do by the government, no matter what party they're in. >> i'm not calling for a bear market but we're in a sixth year in a bull market, and if the fed is going to end qe, i can't discount the possibility. the bear market follows a bull market. >> always safe -- not always accurate -- safe to assume end of year strength persists into the beginning of the new year and you have a spring swoon, something we've seen in the last couple of years. >> what are they going to come out with next year? upgrades and refinements of products that have been around since steve jobs or are we going
11:02 am
to see something that moves it forward in terms of a tv product, and if we get one, is it going to work? >> there's the opening bell. >> i don't think rates will go up rapidly because i don't think we have enough growth or inflation in the economy to make them go up that fast. i think the fed, while okay if rates go up slowly, don't want rates to go up that fast and hurt the economy, particularly the housing market. >> everything's an upsell. what package do you want? if you want the ultimate package, you're going to pay more. but it's going to be -- it's not a big cost. and google will do whatever they can to get people excited about this. >> good monday morning. live at post 9 at new york stock exchange with a check on the markets. dow, flat action after we saw a cooling down on the past couple of days. dow's up eight points, s&p down one. disney the biggest gainer on the dow today, upgrade to buy from
11:03 am
neutral. firm increasing its target from 87 from 77. cooper tire falling after it ends its merger deal with apollo tires. cooper tires did not expect to meet the deadline. our road map for the next hour. markets backing off record highs as we get closer to nut year. is the rally finally coming to an end? privacy concerns about everything from drones to e-mail hackers has tech users ramping up security for their devices. we'll talk to the chief privacy officer at mcafee about what's ahead for web security in the new year. start-up revolutionizing small businesses, ceo of booker tells us how his booking service is changing the way you make appointments and attracting $30 million in funding. start with the markets which are mixed on the second to last day of trading for 2013. s&p's on track for the biggest yearly rise since 1997. the chief investment strategist and dan greenhouse btig's chief
11:04 am
global strategist here at post 9. year-end tends to be seasonally strong. carbon suggests it could bleed into the first couple of week for the new year. >> we agree, of course, with art, whenever we can, number one. no, our call had been all along that we have continued strength in the first quarter of the year. a lot of that is asset allocation as many models used five-year track records for equities and we think that process, as we enter 2014, will be adding to equity, that's number one, it's going to give you a push. two, we think we're going to have a positive resolution to the cr, continuing resolution, with respect to the debt ceiling. that will push markets higher. our call on the market for the first part of the year, we think the s&p will exceed 2000. as the year goes on, as people start to transition toward fundamentals and away from qe, we think we could see a bit of weakness. but we still think the market
11:05 am
will close positive for 2014. >> if there is a land mine in our way, if it's not the government, per se, rates aside, is there anything else or is it rates? that is the only thing to be worried about? >> well, whenever we seem to look at the market and think the market cannot go down, that's when it's probably going to go down, number one. number two, if we get a growth scare that actually growth is stronger than we think, that could cause the fed to be a little bit more aggressive than wall street wants. and then if we get some sort of surprise out there on the global side of things, the biggest surprise, 2014, will be that america, u.s. stock market, continues to outperform especially considering that many of our clients on the institutional side have started bottom fish, europe, and we think it's too early. >> if i can ask you a question generally, when you think about this rally in general, five years long, march 2009, how should investors be thinking
11:06 am
about the secular move? is this bull market long in the tooth, do you think there's more room to run on a secular basis. >> we've been clear that we believe we have entered a 15 to 20-year equity bull market, secular bull market, last of my career -- i'm getting out at the end of this one -- but the current cycle, we think, in terms of investing and fundamentals didn't start until august of 2011. 2009 was a low quality rally, snapback from oversold state in 2008. 2010 was not fundamentally based. it was 2011 when we started to see fundamentals kick in. we think we're early on. it doesn't mean we can't have a sideways market in 2014. that would be healthy for the secular bull that we think is 15, 20 years. >> it's not a threat to the secular theme? >> the next phase has to be earnings growth and sales growth, it has to be. as we move away from this more
11:07 am
reactive market toward acceptance of fundamentals, that's when earnings and sales growth come back, we believe driven by cap x recovery and financial services. >> you buy, what, banks, you buy large cap, what do you buy? a year of caterpillar? >> no, we're more of the diversified industrials, carl. the conglomerates, select machinery that will benefit from the recovery here in america. but also, as emerging markets start to recover, in europe, more diversified industrials from the financial services, we love the theme of private wealth management scale. we love those companies that have big, private client representation but also the big banks able to demonstrate from a consistency basis, carl, growth with respect to earnings. it's not -- it's no longer an expanding roe game, the a consistent roe game and earnings game. >> thanks a lot. happy new year. dan's going to stick around, of course, for the rest of the
11:08 am
hour. women haven't been hacking for the past ten years, according to wide come bin nater. but with win like sheryl sandberg and marissa mayer in the foretech of tech, are women breaking through the digital ceiling? jon fortt. we talk about girl whose code all the time. >> comments that paul graham made to the information, jessica lessons, explosive. not the first controversial thing that paul graham has said about entrepreneurs, the demographics of entrepreneurs. earlier this year he talked about entrepreneurs with heavy accents, supposedly not doing well. that caused a firestorm. how talking about coding and saying that, unless you start coding in middle school, chances are you're not going to get backed by a group like his. that's the problem with women in tech. it's pipeline. but then, perhaps the more troubling theme that he says in
11:09 am
this interview is, i don't know how you get 13-year-old girls to be more interested in coding. i'd have to think about that. why haven't you thought about it? if you thought enough about pipeline, excuse for why there aren't more women backed by a wide come bin nater. look at tech luminaries backing code.org, which we talked about here. they're looking for solutions to the problems. >> it's a long range game. we talk about the emphasis on stem and elementary schools and preschools, to some extent, but is it enough? widespread enough to make a difference in 10, 15 years. >> i think of this as a natural resource issue for the country. we want to be sure we're getting the most out of our human resources. we've got intelligent women, minorities, white men. we want to make sure that everybody, i think, is doing the best that they can at whatever they're most talented at doing. if we're not doing that, we're likely to get beaten by some other country. >> the strength in tech, in
11:10 am
silicon valley, is that an american product or a product from other countries that we've imported as we've let some of these people come in from india and china, for instance? >> i argue that, in itself, is an american product because they what america has been about at its best, being a place globe lil where people want to come and pursue capitalist dreams, among others. >> got to make sure that continues. we want to move to russia. two suicide bombings within 24 hours killed dozens of people in the city, highlighting a major security threat six weeks before the start of the winter olympics. nbc's jim maceda joins us moscow. good morning. >> reporter: hi, carl. investigators are obviously operating under the strong suspicion that the latest attacks were the work of islamist insurgents from the north caucuses, the restive area in russia. police found links between two
11:11 am
bombings, the two most recent bombings, that's the -- they believe the same group or cell that carried out train and bus bombings and explosives used and components, like shrapnel, were similar as well. investigators are also linging those two bombings to a public appeal, if you recall, several months ago by the chechen warlord, an appeal public appeal, directly to his men to kill civilians and disrupt the upcoming winter olympics, an event, of course, that russian president putin has spent a lot of money on, tune of $51 billion, $52 billion, and staked his prestige and reputation on. he's deployed some -- will deploy some 40,000 special forces police and agents around sochi to make it as safe as possible. back to you.
11:12 am
>> jim maceda in moscow. the international olympic committee president addresses that topic in a statement that was just released. he says, the attacks are despicable, cowardly but he's written to president putin to, quote, express our condolences and confidence in the russian authorities to deliver safe and security games in sochi. terrorisms a global disease but never be allowed to triumph. when we come back, defense industry endured big cuts this year. is more the same ahead for 2014? we'll make predictions. first, rick santelli watching the markets today. rick? >> hi, carl, indeed. 37% up on the year for nasdaq. a whisker under 29% for the s&p. a lot depends on where you start counting from when you look at the percent returns. year-to-date, from the year 2000, before the big cavern in 2008? dan's our guest bottom of the hour. he has a bit of a different take on where you should pick your mark and how good stocks are really doing. you don't want to miss this one. [woman]ask me...
11:13 am
11:14 am
11:15 am
[announcer]...if you think the best bed for one of you might be a compromise for the other one... [woman]ask me about our tempur-pedic. [announcer] they're sleeping on the newest tempur-pedic bed... the new tempur choice... [man]two people.two remotes. [announcer] firmness settings for the head,legs,and back... and with tempur on top,that famous tempur-pedic comfort comes any way you like it! [woman]ask me about the lumbar button. [man]she's got her side...and i've got my side. [announcer] tempur-pedic.the most highly recommended bed in america. [woman]don't touch my side! markets in a narrow range. dow up 20. energy here, worst sectission i the second. >> energy's down more than double the next laggard, if you will, in terms of sector
11:16 am
performers. the exploration companies, wpx energy, marathon oil, exploration and production upstream, you'll hear them referred to as, they source the oil. oil's lower on the day. expect to see some names down on that news. chevron, also integrated oil giant, down as well. among these performers, you have to watch the price of oil for these names because overall, carl, they will have an impact, especially on exploration or emp companies. back over to you. >> thank you for that. 2013, we saw a shrinking defense industry. how will it do in 2014? jane wells joins us with her predictions. first, check the scorecard. see how she did with predictions for 2013. jane predicted f-35 will be fine. this is correct. the most expensive program in pentagon history, still taking flight. in fact, south korea plans to order 40 of those jets. second prediction, cash will be king, spent on marking abroad. this was also correct. we saw this year with lockheed
11:17 am
martin, united technologies and boeing. a drone war here at home. she was early with this one, as we have not seen it yet take off. but amazon did announce this year, they're looking at using drones to deliver packages. we'll call it 2 for 3. what's in store for defense in 2014. >> reporter: how times have change. back in the cold war days of f-14, few disputed need for defense spending. 2014 the defense industry battle tested by sequestration and a government shutdown, though sales were helped by a boost in international interests. in 2014, though, things will be tougher, even with the new budget deal, there will still be cuts. lockheed martin continues to work on programs like the f-35, it has been slashing its workforce in other areas and it's not alone. this is one reason goldman sachs expects defense company profit margins will prove more w
11:18 am
resilient. china's making moves, launching the first aircraft care xwrerp expensive and glitchy, but the navy plans to buy 52. finally, a risky guess, we could see funding for nasa start to turn around. don't expect it to take off at mach speed. new funding for projects below earth orbit. good news for traditional ones like boeing, atk, lockheed. why? china sent its first rover to the moon, and congress may not like the idea of looking up at night and knowing that america could lose the space race. >> jane joins us this morning with more from los angeles. good morning to you. >> carl. >> lockheed a favorite of a lot of analysts. is that changing? >> it's interesting. only one sell rating on it. that's not unusual, but given that lockheed hit an all-time high ever last week, of the more than 20 analysts that reuters
11:19 am
follows, five analysts still have a buy or outperform on it, but most analysts have it the a hold. >> that prediction about nasa will get you excited about 2014, that's for sure, jane. see you soon. jane wells from los angeles. straight ahead -- looking for a million dollar home, we're here to help. we'll show you some of the best properties out there and reveal which are the best buy after the break. i always say be the man with the plan
11:20 am
but with less energy, moodiness, and a low sex drive, i had to do something. i saw my doctor. a blood test showed it was low testosterone, not age. we talked about axiron the only underarm low t treatment that can restore t levels to normal in about two weeks in most men. axiron is not for use in women or anyone younger than 18 or men with prostate or breast cancer. women, especially those who are or who may become pregnant, and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur.
11:21 am
report these symptoms to your doctor. tell your doctor about all medical conditions and medications. serious side effects could include increased risk of prostate cancer, worsening prostate symptoms, decreased sperm count, ankle, feet or body swelling, enlarged or painful breasts, problems breathing while sleeping and blood clots in the legs. common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting, and increase in psa. ask your doctor about axiron.
11:22 am
cnbc's popular "million dollar home" competition back with a twist. a price of at least 25 million. six megahomes across the country. two mansions go head to head, one moves forward. we're not going to tell you the location or the price. we'll reveal that after we get a look. the first round, florida's
11:23 am
island time beat colorado's peak pleasure. now round two, $25 million south florida estate takes on city sofistica. >> luxury and privacy on the island. this trilevel beachfront mansion has ten bedrooms, ten bathrooms, and more than 21,000 square feet of living space, including a chef's kitchen. located on more than 1.5 acres, this waterfront megahome includes an elevator, infinity pool, and movie theater. >> luxury awaits as three private elevators whisk you to the 18th floor to your urban oasis in the sky. the 15-room residence has the finest finishes throughout and it's located in an historic big city hotel. there are seven bedrooms, 8 bathrooms and a gourmet eat-in
11:24 am
kitchen as well as a formal dining room. survey your urban playground from multiple terraces, offering stunning 360-degree views. >> joinings now, real estate broker to the superrich dolly lens. the shot of central park gave it away. >> sorry about that, yeah. >> talk to us about value. two expensive properties. >> we tried to trick you with the english accent. couldn't get you, huh? amazing properties, both, you know? the penthouse apartment, city sophisticate is in new york, as you've said. it's a fabulous full floor, 18th floor, huge terraces. and you know, $50,000 plus a month maintenance. so you know, i hope that tepper is around to take a look at it. it's a wonderful apartment. the home is also fabulous.
11:25 am
we revealed it's in coral gables, florida, as you know. and it's a $25 million price point so it's a terrific price point for florida. 25 really is reasonable. >> is that true? >> it is. quite a few $25 million, $20 million $40 million sales in florida recently. that's no longer a big number. the number in new york, however, is a big number, even for new york. it was 95. it was 88 million. i believe it's back to 95 million now. plus the 50,000 plus a month maintenance. that is a big nut. and i have to tell you a year and i half almost on the market. all of those things like that apartment which is in the sherry, the apartment in the pierre, $125 million reduced to $95 million, all of the apartments are lagging on the market for a long time. i think there's one person coming to buy it. it's not going to be a whole bunch, it's one.
11:26 am
and they're both co-ops. it's not a foreigner. >> right. >> that makes it a limited story. >> so, if i know you as well as i think i do, you like florida? >> yeah, i like florida. florida's a show-stopping place. really amazing. no taxes, great property, great location. i mean, nothing i can say negative. >> right. i know you tend -- i'm not -- not universally you prefer things not so urban that you can't change it if you want to change it down the road, right? >> exactly. when you're talking about that huge carry, what's the exit strategy in you know, that's a problem for me. exit strategy is almost my number one criteria, i don't know. it's tough to say if there's five people on the planet vying for this apartment, what happens? >> does that make you think there's been some exhaustion, price exhaustion at the ultrahigh end. >> on co-ops could have been. may have been price exhaustion. over the 50 million. up to 50, i think, we're still
11:27 am
okay, shockingly. over 50 on co-ops, remember these are not foreigners, these are totally u.s. buyers. >> stock market keeps going up, 50 million's going to become easier to meet. >> yes, exactly. look, today looking at 20 and saying, it only 20, right? next year it will be only 50, can we all be together and celebrate that? >> shaking our heads. >> dolly, great. florida's island time does win round two. let us know if you agree. tweet us using #milliondollarhome and catch dolly on "power lunch" to see how the next round unfolds. speaking of bells, bells are about to sound across europe. we'll get their close, final one of the year, in fact, just about 2:30. she keeps you on your toes. you wouldn't have it any other way. but your erectile dysfunction - it could be a question of blood flow. cialis tadalafil for daily use helps you be ready anytime the moment's right.
11:28 am
you can be more confident in your ability to be ready. and the same cialis is the only daily ed tablet approved to treat ed and symptoms of bph, like needing to go frequently or urgently. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, get medical help right away for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or any allergic reactions like rash, hives, swelling of the lips, tongue or throat, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. ask your doctor about experiencing cialis for daily use and a free 30-tablet trial.
11:29 am
that's a good thing, but it doesn't cover everything. only about 80% of your part b medical expenses. the rest is up to you. so consider an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. like all standardized medicare supplement insurance plans, they could save you in out-of-pocket medical costs. call today to request a free decision guide. with these types of plans, you'll be able to visit any doctor or hospital that accepts medicare patients... plus, there are no networks, and virtually no referrals needed. join the millions who have already enrolled
11:30 am
in the only medicare supplement insurance plans endorsed by aarp... and provided by unitedhealthcare insurance company, which has over 30 years of experience behind it. with all the good years ahead, look for the experience and commitment to go the distance with you. call now to request your free decision guide. awe look at europe as they wrap up 2013. >> hanging on to the five-year high they achieved on friday. i just want to break way from markets. getting quite disturbing video coming through from athens. it awould appear the german embassy's residence in the northern suburb has been attacked by an assailant using a rifle. police are suggesting 60 shots may have been fired. nobody was hurt and it's heavily
11:31 am
for t fortified, however a sad end to the year in europe. be aware of the tensions between the greeks, many of the greeks and the germans, greeks blaming the german austerity for the degree to which their economy continues to be wrung through recession and of course unemployment at a record high. ambassador's residence in greece attacked but no one hurt. the market, big news is italy's third largest bank, over the weekend, one of the big -- the biggest shareholder, foundation that has 33% of this bank said it would not allow the capital increase to go through. now, not until the middle of may because it doesn't want to be diluted out. it wants to sell its stake whole and get more for that control. we don't know whether the bank's going to be nationalized or not. the other thing i should mention, watching the situation in france, closely, if you're not aware, the seven times formula champion michael
11:32 am
schumacher is considered to be in a serious situation there, under a medically induced coma, as a result of a skiing accident over the wend. he hit a rock and is in a serious situation. >> despite wearing a helmet, i understand. we're all thinking about him. thank you, simon. a check on energy and commodities as well. jackie deangelis. >> good morning. the energy complex, under pressure this morning, with the exception of natural gas. seeing a spike over 1% in that commodity. and that's because of the threat of colder forecasts on the horizon. everybody watching the temperature closely. one trader telling me if this winter comes out in full force, expect to see nat gas prices five, potentially $6. crude under pressure those morning. west texas intermediate, under $100 a barrel at this point. traded at that level above that level last week, closing there for the first time since october. now, traders are saying they
11:33 am
expect volumes to be thin, ahead of the new year's holiday but they are watching geopolitical tensions closely. that, of course, could spark potential volatility. i want to switch gears and talk about the metals complex. watching gold prices holding above 1200 an ounce. it's a rough year for gold. its worst yearly performance in 30 years. at the same time, watching copper prices. they did spike a bit on the back of that pending home sales number out this morning. number was higher, not as good as expected but traders are reading this in the bigger picture of the housing market. it the best year we've seen for home sales in everyboseven year. seeing copper prices spike on that. >> jackie deangeles. bob pisani joining us. >> we're sideways. ten year, after hitting 3%, thursday and friday, back down to 2.98%. what happened, when it went over the line in the sand that everybody drew at 3%, was not a lot. a lot of people saying that's
11:34 am
because we're on holidays and it will matter in a few weeks. we'll see. the important thing is, interest rates sensitive sectors leading the way. you've got home building stocks, emerging markets, utility, reit index, which had a tough time, moving the market forward. speaking of housing, have you looked at housing since the taper was announced, that was december 17th? look at this, we're essentially straight up. the market's telling people, they're not that concerned now with the higher, potentially higher interest rates, and weave been stable on interest rates. it not going through the roof. quite a run for the itb, the housing etf that you can buy. social media today. yes, they're under pressure, but -- folks, this was $75 a few days ago but public at $27. i don't know. frantic messagize get about people thinking about twitter, this is not that surprising. groupon, facebook, yelp, you know what the prices have looked like this year? up over 100%. look at the charts. nobody should be surprised somebody's taking up profits.
11:35 am
put up the full year. yelp's up 2k 45%. groupon 130. twitter up 130, only a few months and that's by today's price, not thursday. and facebook's up over 100%. a few people taking profits at end of the year. vine's not strong here. nobody should be surprised. this is the teflon year for stocks. we were supposed to have disaster upon disaster that would give us a problem, and it didn't end up happening that way. fiscal cliff, sequester, taper, syria supposed to be a problem, it didn't, the government shutdown supposed to be a problem none of that ended up being a lot for the market. one of the reasons it happened this way, central bankers of the world were active. that was my vote for person of the year. kuroda, bernanke, draghi, better or worse, those three guys had more influence, i think, on the world than any other group of people that are out there. they helped stabilize the global economy and, again, you may or
11:36 am
may not agree with what they were doing but i have no doubt, without them, those problems that i listed, could have steamrolled into something much more serious. vie no doubt, my personal opinion i don't know how you feel, dan, markets who have been lower without the activist policy. >> we can argue about the manner in which they did it whether too generous or not. they are supportive of what the arguments against what rick santelli would say we would have had a larger washout, yes, at the bottom but the rally would have been better and more sustainable. >> nobody took me up on my offer, man of the year for the three men? >> they put, you know, central bankers -- >> i think they had the biggest influence on people around the world, including the people's bank of china. >> "time" magazine, they may be listening, bob. >> they're not listening. speaking of rick santelli, he's in chicago with the santelli exchange. rick? >> thank you, carl. you know, if you have a job, and
11:37 am
you get fired, and the job you end up getting in theent rim is half the pay, you keep looking, you find a job more in line with what you had before, at the same pay, did you just get a raise and double your salary or are you back to square one? ponder that. look at a chart on the s&p, i did it free hand, but it says a lot, from 2000 to today, you know we had a couple of big caverns in essence, if you look where we were from the peaks to now, it's different than looking at it from the lows like march '09, at 676. why is this important? ask dan the man. >> one of the things, they talked about how fast the markets move. if you look from 2000, january 2000 and march, each of the things, respectively, stock market's 20% or 17% up, depending on the level. 13 years, 17% cup laive, not big a drop. if you look at caverns, which
11:38 am
was a good chart, relatively close, drops we had, from october to '07 march '09, dropped 874 points, took 48 months to get back there. it's a slow grind. same thing from the move to the top down to 666, it was to march 13 before we got to the level of march even. >> if i look at it from the peak, how much up from 2000? >> 20%, i'll be generous. >> how should that factor in my strategy, if i am trying to answer the age-old question, is the price of the equity indexes now normalized for the type of activity in the underlying economy? >> if you look at overall ten, i don't offer 20% over 13 year, not a good return. >> not talking about dividends. >> no, just a raw number. it hasn't been good. question, we've had a big move from march 13 to now, 17%, that's aggressive. will that continue?
11:39 am
the economy is going to determine whether or not it is. i feel comfortable right now, but things can happen in a hurry in the market, we know that, so you have to be careful. if anything, i mean, you have to look at stocks that didn't make the move there are a few but hard to find. >> what you're telling me, is that your argument, view stock returns in this fashion, really augers for the fact that maybe the stock market isn't as good as all of those metrics because all of mutual funds show returns from march '09. maybe the economy's isn't as far of an outlier when we think of it this way. >> economy, since 2000, more downs than ups. it does accurately reflect what we did. my argument is, there's all of this talk of a bubble, we're in a bubble. i don't believe we're in a bubble. >> you know what? i vacillate. i will tell you, look at housing, higher rates affected it, try to assume late that into your strategy for the next several years because rates are
11:40 am
normalizing, just a matter how far. >> no doubt about it. >> thanks for taking time today. back to "squawk on the street" gang. >> rick santelli in chicago. let's send it over to headquarters. >> carl, shares of chinese mobile internet and cloud computing company higher, after morgan stanley said in a regulatory filing it had taken 5.2% stake in the company. before today, shares of nq lost half of the value since hitting a high of 26 bucks october 21st. >> dom, thanks so much. from donrones, hacking, nsa privacy, a big theme of 2013. as we close in on the new year, what can we expect in new privacy technology the chief privacy officer at mcafee in a moment. ♪ i wanna spread a little love this year ♪ [ male announcer ] this december,
11:41 am
experience the gift of true artistry and some of the best offers of the year at the lexus december to remember sales event. this is the pursuit of perfection. [ male announcer ] what kind of energy is so abundant, it can help provide the power for all this? natural gas. ♪ more than ever before, america's electricity is generated by it. exxonmobil uses advanced visualization and drilling technologies to produce natural gas... powering our lives... while reducing emissions by up to 60%. energy lives here. ♪ at bny mellon, our business is investments. energy lives here. managing them, moving them, making them work. we oversee 20% of the world's financial assets. and that gives us scale and insight no one else has. investment management combined with investment servicing.
11:42 am
bringing the power of investments to people's lives. invested in the world. bny mellon. welcome back. how is everything? there's nothing like being your own boss! and my customers are really liking your flat rate shipping. fedex one rate. really makes my life easier. maybe a promotion is in order. good news. i got a new title. and a raise? management couldn't make that happen. [ male announcer ] introducing fedex one rate. simple, flat rate shipping with the reliability of fedex. [ male announcer ] introducing fedex one rate. across the country has brought me to the lovely city of boston.
11:43 am
cheers. and seeing as it's such a historic city, i'm sure they'll appreciate that geico's been saving people money for over 75 years. oh... dear, i've dropped my tea into the boston harbor. huhh... i guess this party's over. geico. fifteen minutes could save you fifteen percent or more on car insurance. top of the hour, we're are fining out where experts are taking profits and where investing more money in 2014. small caps having a great year but we will talk to one from bank of america who says now is the time to walk away from the little guys. twitter, falling hard after a big run. time to drop it or is it a buying opportunity? all straight ahead on "the halftime report." over to you. >> thank you very much. privacy concerns from drones to e-mails has technology users ramping up security for devices.
11:44 am
what can we expect in the new year? michelle dennedy chief privacy officer for mcafee. great to have you. good morning. >> thanks for having me. >> i'd say happy new year, but looking at your report of what the new year may bring, it's concerning, virtual currencies will field malware, criminal gangs, social attacks will be u big questi ubiquitous. >> you should be prepared. there's a lot more going on. the more complex our environment gets, the more the opportunity it is for us to innovate to protect against the bad guys but at the same time, there's a lot of people out after your information. >> how do you even protect against some of these things these days? we recently saw this target data breach where 40 million credit card numbers were exposed. we see attacks in the cloud. now they're not just attacking your pc, but attacking where your data resides.
11:45 am
is there much of anything most people can do? >> well, absolutely, there is. and last year, we predicted there would be a lot more of these very fluid attacks and point of sale attacks, telephone-based attacks and going to see more and more companies who have already moved to the cloud and remote applications working from home environments, for example. what you can do is to get really smart about the device that you use, the policies when you're working, the policies that you have for your family, and look at the people, places and things around you. what is your most important information? what do you actively do to know what it is, how you're protecting it on your devices. >> michelle, if i can ask you a general question, on a scale of one to ten, how safe is the cloud? >> it's such a hard question. >> that's why i asked it. >> i'm going to give you the answer. depends on the cloud. look at terms and conditions. you don't need to be a lawyer to understand them. there's a thing that says pro t
11:46 am
private a at cloud provider. some are more private than others. what i suggest as individual consumer be weary of cloud computing and limit and separate the types of information that you share on various cloud platforms. don't use just one for everything that you do. if you're an enterprise, question terms and conditions and take very careful note of the security procedures at the cloud provider, but also within the enterprise. seeing more people dumping responsibility over to the cloud. that's not the case for you when you have the data breach. it's your brand, your customers, it's your data. you have to follow it through the entire life cycle of protection. >> of all of the dynamics, the broad dynamics, that we see in tech, right, cloud, mobile, social, you think any one is most responsible for increase in attacks? >> you'll see combined forces. social, handing out so much
11:47 am
information about ourselves, we're providing the intelligence for social engineering attacks. so if they look to see what what you're doing on social, they engineer your password, that leads to cloud applications. >> to clarify, people not know what social engineering is, old school, figuring out how to con you, right? >> yeah. we're nice to people if i call you up and say, what's your name, you're going to tell me what your name is. if i say, hey, there's a problem with your account, can you just share your password and account number with me, you might say it and spit it out instead of being weary. that's social engineering, using your social guiles and wiles against you to perform an attack. anyone asking you personal data, either on the web or on the telephone. >> finally, jon mentioned target who has to answer new questions. now it's about the encrypted data. the keys reside with external --
11:48 am
payment processors. is that any defense for victims down the road? >> well, it is, actually. so what they're talking about is segmenting and federated. think about the federated stated, each state is its individual thing. data that was encrypted and owned by the payment cards was the data that caused them harm. and so what they are doing is they are keeping the keys, keeping protection of that piece of data, the more data that it's segmented and owned by people that will profit or lose by it the more protected we are. so that's a great sign that there was a piece of critical information that led to the debit card exploitation that actually was never owned at the point of sale terminal. that's a healthy sip fgn for target. >> they go by target sometimes, too. we'll talk to you more in 2014. michelle dennedy.
11:49 am
is the receptionist a thing of the past? thanks to the cloud, the front desk could be more streamlined than ever. bringing the cloud to small businesses all over the country, in a moment.
11:50 am
11:51 am
cloud technology a hot buzzword this year. how is it put to use on main street? josh mccarter, a start-up that offers cloud solutions for small and medium sized companies joining us new york with jon
11:52 am
fortt. good morning. >> good morning. >> we had a discussion with someone from mcafee about the privacy risks regarding the cloud. how do you walk mom and pop through the land mine? >> it certainly is a process. i think s&bs are becoming accustomed to cloud-based computing, that's where customers are, they want to interface through businesses and businesses want to run off of tablets and they'll get that through cloud-based systems. >> providing a back end for dentist, doctor offices to interact with customers, potentially huge. intuit spent $423 million on demand force. how do you compete? demand force, well-funded, well-backed. you spun out from a different company, attacking the same space. why are people going with you instead of your competitor? >> we focus on the health and wellness market, spas, salons, fitness centers and demand is a
11:53 am
potentially marking product, bringing customer backs to a business, not operate the business. the business focuses on providing tools for operations and marketing. we recently launched a product, promote, demand for a competitor that allows business to create marking campaigns that go out at preset intervals with different offers to existing customers to bring them back, create loyalty. >> normally the way the sort of businesses grow, we see it in workday and others, start with one niche, one industry, branch out in industries and capabilities. is that the direction that you're going to continue to head? and where do you fit in with some of the bigger names out there that might be looking to acquire firms like yours? >> right. yeah, we definitely started in one niche, spark expanding into fitness and beauty based industries. we have blow dry bars and a waxing center. we push out into other
11:54 am
class-based programs, things that have parent-child type activities, classes and so forth. in terms of the broader market, there's a lot of evolution taking place now in the local commerce ecosystem. so companies like ebay, amazon, pushing into local services and we think think we perfectly, whether in partnership or something strategic down the road. >> getting a sense from the smaller businesses that corporate budgets, ty, capx, what loosen up in the first quarter next year? >> yeah, we have seen a lot of investment this year in i.t. systems and i think that's going to continue into 2014. people want to improve the quality of their operations, which is now really available through cloud-based systems like booker. >> josh mccarter of booker, thanks for your time. we'll keep our eye on you. google at home, at work, on your phone, now in your car. at ces next week, guckoogle
11:55 am
expected to announce in-car intertaki entertainment systems. you'll be glad you'll have google on the car, why? bny mellon combines investment management & investment servicing, giving us unique insights which help us attract the industry's brightest minds who create powerful strategies for a country's investments which are used to build new schools to build more bright minds. invested in the world. bny mellon. [ bell ringing, applause ] five tech stocks with more than a 10%... change in after-market trading. ♪ all the tech stocks with a market cap... of at least 50 billion... are up on the day. 12 low-volume stocks...
11:56 am
breaking into 52-week highs. six upcoming earnings plays... that recently gapped up. [ male announcer ] now the world is your trading floor. get real-time market scanning wherever you are with the mobile trader app. from td ameritrade.
11:57 am
just by talking to a helmet. it grabbed the patient's record before we even picked him up. it found out the doctor we needed was at st. anne's. wiggle your toes. [ driver ] and it got his okay on treatment from miles away. it even pulled strings with the stoplights. my ambulance talks with smoke alarms and pilots and stadiums. but, of course, it's a good listener too. [ female announcer ] today cisco is connecting the internet of everything. so everything works like never before.
11:58 am
welcome back to "squawk on the street." this past saturday marked the passing of billionaire harold simmons, served as board chairman for three publicly traded companies and all three companies are showing strong upside moves in the market. shares of valhi up 4%, kroos up 10%, and nl industries up, as well. carl, interesting moves in light of the news. >> thanks, dom. from driverless cars to luxury cars, at ces next week, google is expected to announce it's working with audi to develop android-based in-car entertainment and information systems. next time you're on a long road trip, you'll be glad you have google in your car because? the man writes, i won't end up in the atlantic ocean following
11:59 am
apple apps. ronald, i'll know where the nearest nsa spying location is. it can drive the car while i sit back and count my gains owning google stock, interesting, which is holding on to key levels, well above $1,000. >> is that larry page's twitter account? >> are you going to ces? >> i am. >> expecting it to be wild? >> i wasn't last year. i actually was wowed because of the smaller devices connecting to phones. this year, bar's higher. i'm expecting cool stuff. see what we get. >> we'll continue. it's a story, no matter what, in 2014. valuations aside. >> i would say, we have an overweight on tech, relative to the s&p, only sector that remains meaningfully attractive relative to the different tech. there are pockets excessive but we're in the golden age of technology. a debate whether the bulk of the begans in society are behind us. is twitter as important as
12:00 pm
in-door plumbing. >> the golden girls age of technology. >> "golden girls," a great show. >> thank you for being a friend. we're worried the stocks are getting old, right? >> a fair worry, correct. >> worry about for a while. dan, thank you. great having you. jon, see you tomorrow, i hope. back to headquarters. melissa lee and the halftime. here's what we're following today. 400 club, home runs and grand slams, trading six stocks with gains of more than 400% this year. check your statements, you may own one. david versus goliath, betting on small stocks, russell 2000 up 37%. time to go big or go home? small caps, big runs with b of a head strategy. hold them or fold them? a banner year for stocks, we are

141 Views

info Stream Only

Uploaded by TV Archive on