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tv   On the Money  CNBC  May 28, 2016 5:30am-6:01am EDT

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. hi, everyone. welcome to "on the money." i'm becky quick. airports, long lines, packed terminals and short tempars. >> whoever is at the head should be fired. >> road sense. how to get there. >> will gas prices stay low during the summer? the summer shopping season. how to find the real bargains an the best time to buy everything from mattresses to televisions. looking to dress up your burger, believe it or not, there's an artisinal ketchup out there. how two guys took on a huge industry. >> ketchup hasn't changed in 50 years. "on the money" starts right now. >> announcer: this is "on the money," your money, your future. now, becky quick.
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we begin with a bumpy start to the summer travel season. a record 231 million people are expected to fly this summer but travelers are spending hours stuck at security checkpoints and missing flights. what's behind the long lines and could your vacation being at risk? reporter phil lebeau is at chicago's o'hare airport, the site of some of the worst delays. that is today's cover story. phil? >> reporter: becky, the lines are far shorter than what we saw a few weeks ago. part of that is because of additional staffing by the tsa and airlines. despite those shorter lines you can bet the hassle of getting through security will be a focus for a busy summer for those traveling. the frustration is easy to see. long lines at airport security checkpoints sometimes topping one or two hours are taking a toll on travelers. >> how do we get to this point? it's crazy. >> it's got to be a better way than this.
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>> it's disgusting and it's uncalled for. whoever is at the head should be fired. >> reporter: american airlines says 70,000 of its customers have missed their flights this year because they couldn't get through security in time. it's become so bad the head of the tsa is under fire. in response, peter and his team are adding officers and more overtime. but even he admits there will still be lines at airports. >> i think this summer is going to be a challenge. we have passenger growth. i haven't gotten back as much staff as i need. >> reporter: one approach in atlanta, automated security lines where five passengers at a time can get their carry-on bags ready to be screened using bigger bins. when somebody is ready their bin is automatically sent through the x-ray machine and they go through a metal detector. if another traveler is going slow, they don't stop the entire line. potentially, the number of people screened every hour could increase by as much as 30%.
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but early on, travelers give the system a mixed review. >> i didn't think it was faster. >> seemed to go pretty quickly. went through the front of the line and my bag did get screened but it only took ten minutes all together. >> reporter: the long lines with a record number of people expected to fly this summer could lead some travellers to say enough. >> anecdotally i'm hearing from people they're planning on more driving vacations in the northeast or along the west coast to shorter, closer destinations. >> reporter: but for those flying longer distances, driving is really not much of an option. the bottom line is this, becky. if you are flying this summer, be prepared, there may be a time or two when you get to the airport and you're going to see a lengthy line to get through security. >> yeah. it's something that people are already trying to brace themselves for, phil. what about the idea of airlines actually dropping the fees for checked bags so people don't bring as many through security?
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would that make things move faster? >> reporter: it's debatable how much that would help. if you look at an airline like southwest which doesn't charge for the first two bags, it's still seeing delays similar to what other airlines are seeing in the last couple of weeks. a lot of people believe that even if the bag fees are dropped, you're still going to have a lot of people trying to bring their carry-ones onto the plane and that's slowing down the system. one factor slowing down the system. >> all right. phil, thank you. phil lebeau. so what can be done to speed up the lines while keeping us safe? tom blank is a former tsa deputy administrator, mike voigt, an aviation consult and the president of boyd group international. thank you both for being here. tom, why don't we start with you, what do you think is causing the long lines at airport security? >> tsa has made bad assumption about the personnel resources necessary to process the 2 million passengers each day that come through. they assume that the tsa
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precheck program was going to create enough efficiencies and speed enough people through that they could do with some 3,000 less transportation security officers. and they agreed with congress to cut the funding from 45,000 personnel down to 42,000. that turned out to be an error in judgment and that is one of the fundamental reasons that we're seeing the situation that we have. another key issue is that last summer tsa got a very bad report card, so to speak, on its security performance. the new administrator is changing the culture from one of convenience to one of security. that is going to slow things down. >> mike, how much of the blame do you think the airlines themselves are responsible for? we see a lot more people bringing on carry-on bags to try to avoid the baggage fees. how much does that play into this? >> that's not accurate. the bit about bag fees. we've had the same situation a
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year ago. there's only 1% more flights than a year ago. we see this backing up. it's not bags. the fact is, this is major incompetence. there's not a single reason the tsa has given for this that you could really look at. they cut screeners, they knew how many people were signing up for precheck. we had 95, 96% failure rate. that alone doesn't mean you change things. you throw the people out at the top. we're not safer than we were before. the people at the top is a game that can't shoot straight and so until they're removed and we have real security we're not going to be safer than before 9/11. >> tom, is mike right? >> well, i do think there's something to be said for the fact that tsa has had seven or eight administrators in its history -- of 15-year history. there is turnover at the top. that does create a situation where the next rung down becomes the permanent leadership of the agency. >> well, there have been complaints, look, no one gets fired. there's not real accountability,
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even the administrator who was simply moved positions and not fired. i think there's only been one firing in this administrator ranks since the history of this. >> well, could you level that criticism across the federal government. it's very difficult to fire and discipline federal employees. i think what you can do and what tsa must do is provide flexibility to individual airport managers. and that way they can deal with a local situation and not have a centralized control from washington, d.c., dictating what goes on where local managers could deal with some of the problems that are occurring out there if they were permitted to. >> we also need professional managers, trained security people. we need professionals running this. not political appointees. >> tom, is privatization a solution? some airports, san francisco and kansas city, are turning to private contractors. >> it could possibly help. but it should come with additional flexibility.
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and what i mean by that is, even though they are private screeners, they are still required to use all the tsa procedures. they are managed by tsa personnel. but if you allow them to move personnel around, if you allow them to deduce split shifts, if you allow them to do various kinds of things to deal with peak loads, privatization could help substantially. >> mike, i want to say that part of this is poor communication. just in the last few weeks, i was at a flight, i was told to show up at least two hours early. once we got checked in, we waited for the tsa employees to show up. it's not an efficient process. >> no, it isn't. it's not even a good security process. if anybody thinks this is better than what we have before 9/11, you're dreaming. when you have a 95% failure rate, we have a system that needs to be completely rebuilt. the public is not safer than it was before. this is all for show and not a lot of go.
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>> do you think it's very helpful that we'll see things fixed any time quickly, mike? >> no way. let's stop acting as if the tsa is the victim of something that came along. we are the victims of really, really bad, sloppy management and that's why we're paying the price. >> on that note, thank you, guys, for joining us today. we appreciate it. >> thank you. now here's a look at what's making news as we head into a new week "on the money." america's economy grew slightly faster than first thought last quarter. the second read of the gross domestic product was slightly higher than the original reading of 0.5%. housing was strong while consumer spending and business investment were both disappointing. stocks had a solid two-day rally midweek, powered in part by energy prices as oil prices rose. and they continued to climb later on in the week. durable good orders for april grew a lot faster than expected. those are products expected to last at least three years.
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things like cars and computers. they were up 3.4% but the number was spiked by strong orders and a volatile area. aircraft. and two more big names in the auto industry are making a big investment in ride sharing. toyota putting an undisclosed sum too uber and vw is sharing with a major european ride sharing company. up next "on the money" looking to vacation but draegds the airport. how about a road trip instead. we'll tell you what you need to know before you start that drive. and looking at this weekend's big holiday sales, everything from grills to mattresses, we'll go bargain hunting and tell you where you'll be getting the best deals. right now, though, as we head to the break, look at how the stock market ended the week. ♪ you get use to pet odors in your car. you think it smells fine,
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38 million people expected to be traveling this memorial day weekend and almost 90% will be driving to their destination according to aaa. will the summer be the summer of road trips and what are some of the tips to keep you save op jur journey. joining us right now is vera gibbons and robinson claire of aaa. vera, the gas prices, as we know, have been rising but we're still about 50% below where we were a year ago. >> right. we are expecting the lowest summer gas prices we've seen since 2005. they're very attractive prices. the ten-year memorial day average is 3.15. we're significantly below that at 3.32. that's inspiring a lot of people to hit the road. but in addition to that, you have other factors contributing to it, like the heightened terrorism fears and europe
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travel is down by 13%. you've got the zika virus. that has a lot of families taking we don't want to take a beach vacation to mexico or the caribbean. it's too risky. let's play it safe and go closer to home. this has a lot of people saying let's not fly anywhere and throw the kids into the car and take that road trip, take advantage of the low gas prices and hit it. >> and be ready to sit in traffic, too. >> it will be pretty busy, yeah. >> americans save $18 billion on gasoline so far compared to last and we've seen heavy road travel all this year. the energy information administration says we're using 403 million gallons per day. that's a record and something we normally see maybe late august and we've been doing that since january when there was snow and ice on the ground people were driving a lot. last year set a record for new vehicle sales, 17.5 million. get a new car, you want to drive it. >> right. what are some of the precautions if you opt to go on a road trip? >> we performed 29 million emergency road service call as year. >> 29 million? >> 29 million.
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17 million for flat tires, dead batteries and people locking their keys in the car. make sure tires are properly inflated. according to the information on the plaque card in the doorjamb. do it before you leave. and then you should do the penny or the quarter test. you put lincoln and washington's head in the tread and it should cover their heads. >> vera, if the kids are going to help me get involved with some of this maybe, maybe help plan some tips along the way. what are ways to make them feel like they have ownership. >> adults like to save on the gas buddy, and save time, where they will stop for meals and things like that. the kids are using roadside america. where they can find the funky cool interesting things to do like they can visit the robot museum. >> the world's biggest yarn ball. >> right. all sorts of cool stuff and also food is a big part of the american road trip. kids are involved in finding
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eateries on like master chef junior or tv food map which locates those features. >> what do you expect the top destinations will be? >> they are pretty far afield. orlando, myrtle beach, d.c., new york, los angeles. >> people are going to canada. for for a lot of the population, it's just a day's drive away. >> big one. >> thank you both for your time today. >> thanks, becky. up next, we are "on the money." memorial day weekend means sales are everywhere. could you save more if you wait? >> and later, that burger better get it ready for ketchup competition. the challenges to big boys. stick around. put some distance between you and temptation with meta appetite control. clinically proven to help reduce hunger between meals. new, from metamucil, the #1 doctor recommended brand.
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memorial day weekend means celebrating and mem mallizing our veterans and hitting up the big sales. which deals are worth your money? joining us with when to buy and wait is senior personal fitness correspondent sharon epperson. great to see you. >> great to be here. >> when you get to memorial day weekend about everything goes on sale but run through a bunch of the big categories and see where things work out and where they don't. i feel like you get a lot of ads for appliances. where do you start? >> tons of ads for refrigerators washers, dryers, rangers. grills. home appliances are really what is on sale and you're seeing really big sales.
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this is the time -- this memorial day weekend is definitely the time to buy those major appliances. you may see sales of 50% or more and you're probably not going to get a better day to buy than maybe at the end of the year but right now it's a great time to buy. >> what about people thinking about their yards, trying to get things ready, trying to get things taken care of. maybe they have issues around the house to get worked on with tools. what about that kind of thing? >> power tools, if you're being looking to buy power tools, a lot of folks may be thinking this is a great time to buy but actually this is the time to wait because father's day is actually the time when you really want to get those clearance sales on power tools. that's just a few weeks away. >> just a few weeks away. we're looking at the end of the school year and people are starting to think about where to go on vacation. is this a good time to book travel? >> absolutely. this is the time to book those airline tickets and bundle it all together and get the deepest discounts. you're going to see a lot of savings. don't wait much longer to book
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the summer travel. >> what about laptops, smaller electronics? >> you know, i want the school year to be over, actually. i have to say, just wait, let's wait on all of that before right before the school year starts. that's when you'll see the big discounts. i think it's better to just wait right before the school year starts. that's when you're going to see bigger sales. >> and black friday. >> and black friday as well. >> what if you need a new grill, if you're looking for patio furniture? we're all getting ready to head outside and spend more time there. can we find sales? >> you want to spruce up your house right now but so does everyone else. you want to wait for the summer clearance if you can. actually get that patio furniture for the next season and the grill for the next season. if you really want it right now, you might see a few sales here and there but the best advice is to wait. >> and finally, mattress sales for whatever reason. why do you see so many ads for mattress sales? >> well, the theory in the
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summer it gets hot, harder to sleep, maybe harder for them to sell. right now is a great time to get a mattress, probably the lowest prices for the year are going to be this weekend. so if you need a new mattress, now is the time to get one. >> sharon, thank you. great advice. >> sure. >> up next, "on the money." a look at the week ahead. catch chep change-up's new -- ketchup's new squeeze. sir kensington is ready to stake its claim in the grocery store. revives skin to fight 7 signs of aging. with olay, you age less, so you can be ageless. olay. ageless. cathy's gotten used to the her kitchen rbage... yup, she's gone noseblind. she thinks it smells fine, but her guests smell this. ding, flies, meow febreze air effects heavy duty has up to... ...two times the odor-eliminating power to... ...remove odors you've done noseblind to [inhales] mmm. use febreze air effects, till it's fresh and try febreze small spaces...
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(laughing) trap and lock up to 4x more dirt, dust and hair than the store brand stop cleaning. start swiffer ing bounty is two times more absorbent. more "sit" per roll. so one roll of bounty can last longer than those bargain brands. so you get more "life" per roll. bounty. the long-lasting quicker picker upper. oa skin transformation that rivals the leading department store moisturizer. revives skin to fight 7 signs of aging. with olay, you age less, so you can be ageless. olay. ageless. for more on our show and our
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guests, go to our website and follow us on twitter @onthemoney. the stories that may impact your money this week. # on monday, markets are closed for memorial day. on tuesday the case-shiller home index for the month of march. wednesday, we'll see how well the auto sector fairs for the month of may and marks the first day of 2016's hurricane season. on friday, check out the local bakeries for doughnut deals because it is national doughnut day. oh, yeah. we'll be getting the big number of the week, the may jobs report. it's memorial day weekend that means it's time to fire up the grill and i like my burger with good old ketchup. hines is no longer the only option on the grocery shelf. as kate rogers reports, sir kensington is bringing in new competition. >> reporter: ketchup, that's what they thought about their last semester of college while everyone was out partying.
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>> one day we were talking about how weird it was if you go to the grocery store, you walk down every i'll, you're overwhelmed by choice in everything, a million cereals and yogurts and salsas but one area of the store, ketchup hadn't changed in 50 years. we thought, that's really weird. let's see if we can do something about that. could we create a ketchup that was in line with the way we wanted to eat and also satisfy that really specific flavor that people look for when they reach for a bottle of ketchup. >> reporter: so the students headed to the kitchen and hosted a tasting for friends. >> we researched the history of ketchup and found recipes and we gave people rating cards when they came in. we wanted to make something that people really liked. >> reporter: their regular and spicy ketchups were a hit. after graduating, mark took a job in new york consulting and scott took off to tokyo to work in banking but they couldn't kick their ketchup obsession. these guys worked on their business plans on nights and weekends and in 2010 launched sir kensington's a natural
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condiment brand. today it's in 5,000 stores in all 50 states in canada and also sells online at around $5 for a 14-ounce bottle of ketchup. and by the way, who is sir kensington? don't bother searching wikipedia. it's just a fictional character who serves as inspiration to the co-founders. >> sir kensington as a brand is about not taking yourself too seriously. when you only make kund mentes you can't take yourself too serio seriously. >> the brand is growing at 200% annually and half of their business is actually with high-end chefs like the spotted pig in new york city and have raised about $8.5 million so far. becky? >> you said it was about $5 for 14-ounce bottle. how does that match up? to the traditional heinz brand. >> you're paying about a dollar or two more. but i did do a taste test and the stuff actually -- >> ketchup is ketchup. >> takes like tomatoes. heinz has a lot of artificial stuff in it. they offer some versions of heinz that don't have as many additives in it but this stuff
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is all natural and you can taste the flavors, much more flavorful and rich. >> by artificial you mean preservatives. >> and things you can't pronounce. this company if you can't pronounce it it's not in their brand. >> i have to try it. i am addicted to heinz. >> open your horizons but you might like it. >> thank you very much. >> thank you. >> that's the show for today. i'm becky quick. thank you for joining us. next week, it is june and that's the most popular month for weddings. the latest trends in saying "i do." each week, keep it right here for "on the money." have a great week and we'll see you next weekend. ♪ what are you doing right now? making a cake! ayla reminds me of like a master chef and emiana reminds me of like a monster chef. uh oh. i don't see cake, i just see mess. it's like awful. it feels like i am not actually cleaning it up what's that make mommy do? (doorbell) what's that?
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swiffer wetjet. so much stuff coming up. this is amazing woah. wow. now i feel more like making a mess is part of growing up. stop cleaning. start swiffering.
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hey there, we're coming to you from a live from a hot and sultry nasdaq market site. it's so hot, the guys back here need a moment to cool down. while they're doing that, here's what's coming up in the show. ♪ ♪ oil that is black gold >> ahead of opec, crude may be done bubbling up. we'll tell you what have some traders so bearish. here's mcdonald's plans to increase sales. ♪ big mac mdlt filet fish regular and large sizes garden or a chicken salad ♪ >> we'll tell you why combos are the latest craze for the golden arches, and how you can profit. and, how would you like to buy apple and spend nothing? >> nothing?
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