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tv   Your Money  CNN  June 30, 2013 12:00pm-1:01pm PDT

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paula deen's $17 million empire is crumbling like a butter laden coffee cake. dean is losing one business deal after another following her admitted past use of racial slurs. it started with the food network and it hasn't stopped. walmart, home depot, target, ceasars entertainment. smithfield foods will stop whatever their business relationship with her and even n nordi nordisk, where she had been a face for diabetes. it's hardly the first time for a celebrity. martha stewart went to prison for lying about a stock sale. >> i'll be back. >> reporter: she did. last year, they had more than $2 million in revenues.
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michael vick for a dogfighting ring and became an ambassador for animal cruelty. >> i encourage you to love your animals, whatever animal you have, whether dog, cat, reptile, whether it's a horse. >> reporter: golfer tiger woods survived an inefy dealt scandal to regain the number one ranking and sportscaster survived a sex scandal that ended in a misdemeanor assault plea. lance armstrong following a doping scandal with an interview with oprah wasn't enough. >> did you ever take illegal substances to enhance your skills? >> yes. >> reporter: but did paula deen cross an unforgivable line because her comments were about race. jimmy the greek sniwas fired
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because of this. >> the black is a better athlete because he's been bet er red to that way. >> reporter: and mel gibson and then imus came off the waves but then back on. they all apologized for their remarks but will remorse save deen? she sifted on an ada televisi " television appearance. >> if there's any out there that has never said something they wished they could take back, if you're out there, please pick up that stone and throw it so hard at my head that it kills me. >> so is paula deen redeemable or has she uttered her last on camera ya'll.
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i want to start, deen's today show appearance didn't seem to help her. more companies dropped her after that appearance. we know she hired a crisis manager. if you were advising her, what would you tell her to do? >> i don't know her. it's important to any you not put her in a situation she is uncomfortable, boy, is she uncomfortable. >> you thought she dade? >> any time you make someone do something outside the box they're uncomfortable with, disaster. >> it's a lawsuit and blown up into a very very big public fight. if you were advising the companies dropping her or at least hitting the pause button, if you're advising the company boards, what do you tell them? >> you ask her to suggest that they withdraw for a while. let's take back and take time out from the relationship and let me deal with the issues i have and get through this and
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then talk about what we do next. >> none of that -- >> that takes the company off the spot. i'm sure there's a morality clause in every agreement she has and sure she violated it. >> is there a playbook for stuff like this? >> there is a playbook but as soon as it happens you throw it out. >> every crisis is different. >> you look at her book sales, this week, book sales soaring, some on back order. new ones haven't even been out yet. lines in front of her restaurants. her hard core fans are outraged she is being victimized in a way. it's interesting that response. >> it's almost like this backlash has gavel vanized her fans. you mentioned the long lines outside her restaurants in savannah and her cookbook skyrocketed to number one on, went from the 1500s to number 1 after the scandal. i was reading through the comments. i don't even like to cook. i'm buying paula deen's book because i want to support her. this is moo way of supporting
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her. there was a second cruise line added after this because sales shot up on that. also, what's interesting, the food channel not be confused with the food network is getting inundated by paula deen's fans, hey, you've got the wrong network here but we're interested in possibly picking up paula deen. paula deen's pr team has contacted the food channel to enter discussions about a relationship. obviously we've seen some big companies drop her, about a half a dozen. at the same time, we are seeing her fans come together and could see new opportunities spring up. >> we have seen you never count out a comeback. this is the comeback country. this is how martha stewart handled a morning tv appearance when, you know, the insider trading scandal erupted for her back in 2004. >> my employees and i are hard at work at making our company the best omnimedia company in the world, jane. we will continue to do that and
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i want to focus on my salad. >> i want to focus on my salad. can deen learn something from martha stewart? >> different situation. to the point we made earlier, martha stewart was on the board of the new york stock exchange and she withdrew. >> and bob zito was working on the new york stock exchange. good point. she made the first move and withdrew from the board. >> yes. >> that's a really good point. in the celebrity culture in america, we see them built up and torn down so quickly. do you think some of her fans were galvanized by all this, see that, see her sort of a scapegoat? >> we heard from reverend jesse jackson yesterday over twitter. basically that's exactly what he said, look, let's not use her as the sacrificial lamb or scapegoat what he called southern culture. whether you disagree with that or not, i do think a lot of her fans are saying, look, she said this 30 years ago, let's not take out any -- >> there are those saying is this a word you say just one
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time? >> that's what nequestion still is. >> there are those galvanized by her appearance and feel she's been made to be a martyr and the other side of the fence, they're saying, wait a minute here. this is the tip of an iceberg. her reputation has been very very damaged here, bob. how does she get it back? >> her reputation has been damaged but we sit in a city eli eliot spitzer got a television show, where the mayoral candidate, anthony weiner, is leading the polls right now and 70 miles up the road where michael vick is lyonized by 60,000 people every sunday who pray the only thing that doesn't happen is he doesn't fumble. she can make a comeback. >> i interviewed her several times. she wrote a blurb for my book and she's someone who i've never heard her use this language and people who work with her daily never heard her use this language. she is a saucy character and says what she means and doesn't have a filter, i will say that.
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we'll see what the next chapter holds for paula deen. mortgage rates just saw the biggest jump in a quarter century. if you've been on the fence about financing, time to get off the fence. what rising rates mean for your wallet and the economy.
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the u.s. housing market is healing. home sales are up and so are home sales and the pace of home construction. so are mortgage rates. the biggest rise in mortgage
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rates in one week since april of 1987. last week, rates soared. rates on fixed loans rose to 4. 4.46%. 15 year fixed rate jumped to 3.5%. mortgage rates have been on the rise since late april. the average rate was 3.56 since early may, the highest since july 2011. let's do the math. a $200,000 home loan costs 1,008 a month in may. a monthly payment now is 1,008 from $881. why is this happening? the fed may start tapering back its compare stimulus. that stimulus has kept mortgage rates low. it can't last forever. that means you will pay more to borrow. don't get me wrong, rates still historically low but not nearly the deal you were getting a year
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ago. if you want to lock in these low rates, you better do it soon. i want to bring in jonathan, a real estate appraisal. is it your assumption mortgage rates will keep rising and pinch the housing? >> i don't know if pinch is the right word, it could get housing to reality. the fed is drive iing housing u. and tight credit from mortgage rates. affordability drops but i think we will see credit ease which then brings in a broader array of buyers to the housing. >> not really a tipping point. high mortgage rates are not really a tipping point? >> i don't think so. not like we didn't see this coming the last couple of years. rates basically couldn't go lower. that means at some point they have to go up. don't get me wrong, it hurts. if you can't buy a house because that half percentage point
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moved, can't at 4.6%, you probably shouldn't be buying. you need money in the bank and a job and should be able to buy a house no matter what the rates are. >> clearly, people on the margin don't quite fit in, with rates rising, that signals the economy is probably getting better. not a direct correlation, but clear clearly, we're seeing a better market and economy going forward and good for housing. housing has been addicted to low interest rates. now, we need to been it owean i we get a real housing recovery. >> it dropped in april and you can measure 20 cities, the stop real estate markets in the nation, the biggest annual jump in seven years. inventory is still really tight. is it safe to assume these price
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gains we were just showing you, they're bound to slow? le. yeah. what you will see with rising rates, it's actually a good thing in the long run. what it will do is temper the pace of price appreciation. you think about it. a 12% rise in the index, did people's income rise 12% over the last year? it's a play on tightness of inventory. >> talk about that tightness of inventory. maybe some people aren't familiar with the terminology. there aren't enough houses for sale in markets so home prices are popping so if you have to buy you don't have a lot to choose from. >> inventory is down virtually across every major market in the u.s. >> because people are under water? >> that's a big part of it. >> canned afford to sell it or put it on the market? >> right. exactly. homeowners, when they sell their home, they have to buy or rent and rents are rising across the country. they have to qualify. if they don't qualify, what do
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they do? nothing. they don't list their home therefore inventory remains tight. we're not replacing the housing stock that's being sold by new housing stock because credit remains historically tight. >> another reasons why we're seeing the pop in home prices is because sometimes the foreclosureses ha have been kee prices down in some neighborhoods. as you work the foreclosures out of the system, the housing prices can rise. what's the foreclosure situation? >> foreclosure is friendi intre the downward slope. we're significantly elevated and a heavy concentration in four or five states where over half the foreclosures are occurring. it's getting better, not what it was a couple years ago. still, the housing market can't truly be qualified as record until we get distressed real estate more fully absorbed. >> if you had to give a letter grade on the housing market,
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what would it be? >> i think i'd give it a c plus. really trying hard for a b minus. >> your one piece of advice for seller sellers. >> you have to look at the market. what sellers do, read about everything popping, they get greedy. not everything is selling. you have to price within the market norms at this point. >> price it right. what about for buyers? >> buyers, i wouldn't panic, if you really want to take advantage of rates. i think rates will be pretty reasonable the next couple of years. just take your time. find something that you want, just don't rush in and buy something just because you think you're supposed to. >> buying real estate is not like buying an etf. a very big commitment with a lot of money. thanks for coming in. nice to see you. college kids, you will pay double to borrow money for tuition next year, as if college isn't already expensive enough. everyone's retirement dream is different;
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for a store near you go to this next story is going to affect about 7 million people. on monday, student loan interest rate set to double from 3.4% to 6.8%. they will double because congress failed to reach a deal before the july fourth recess. joining us now for what this means for students after those footing their bill. >> it's not all types of student loans affected. subsidized stafford loans, need-based loans for those who can demonstrate a degree of financial hardship. those students could end up paying 3 to $5,000 more over the life of the loan. >> i'm almost $60,000 in debt which will affect my ability to
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get a mortgage, to have children and put them through a good education and affect what kinds of jobs that i choose. >> columbia student, rachel boehr started out studying drama but skyrocketing tuition costs forced her to drop out. at age 30 she's only just finished her graduate degree. >> we're asking too much of our college students and narrowing and narrowing the field of who can be a college student in the country. >> reporter: american college gradss owe over $1 trillion in student loans. as tuition rates continue to soar, rising interest rates could be a headache. tuned stafford loans were fixed at 3.4%. that rate is scheduled to double. >> i think doubling the rate to 6.8% would definitely increase default rates because, again, the stoonts receiudents receivi
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subsidized loans are at the lowest income brackets. >> reporter: while some want to keep it at the3.4% temporarily, others say it should be able to fluctuate with market forces. >> i think there will be a compromise or my guekick it dow road and we will revisit it in another year. >> reporter: it would be a boost for government generatiing $36 billion when congress is scrambling for cash but it could cost students as much as $5,000 more in payment. >> the president and mrs. obama just finished paying off their student loan. the fact they're 40 years old and still paying off student loan debt is really scary. we could be 50 or 60 years old without paying off our student loans. >> politicians have to look beyond their own self-interest. college students like myself and my peers are counting on them. >> the good news is congress can
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reach an agreement after monday and enact it retroactively. lawmakers are deadlocked. on the one hand, should they allow loan rates to fluctuate 10 year treasury but is that fair to students and parents not to give a safety net and if you keep it low, is that fair on the government when we're under pressure to reduce the deficit. >> and taxpayers. taxpayers foot that bill. you can make an ideological argument do you want to fund someone else's education they won't get a job in. we have to start to think about is it taxpayer support of out of control tuition? >> i spoke to students and they were saying to me, listen, zane, on the one hand, it is important to lower the loan rates. on the other hand, the government should look at ways to lower the cost of going to college. $31,000 is so much, especially when you can't guarantee you will get a job afterwards. >> if you spent 60 to $100,000 to a big private school you
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should think about a state school, guess what, you will graduate with a lot less debt. thanks. coming up, this generation has marissa mayer and before that, carly f, who knows how to generate jobs. up next. which provider is the best in town. you'll find reviews on everything from home repair to healthcare. now that we're expecting, i like the fact i can go onto angie's list and look for pediatricians. the service providers that i've found on angie's list actually have blown me away. find out why more than two million members count on angie's list. angie's list -- reviews you can trust.
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americans are ready to get back to work. what's holding them back? the question that con found this recovery? where is the jobs boom? we want answers and that's why carly feorrinny is here. from secretary of a small business to fortune's most powerful woman in business six
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years in a row. it would take the whole show to go over her resume. you were ceo of hewlett-packard and you know what it takes to create jobs and what it's like to lose them. i want to talk about whthe obam campaign said they would create 4 million jobs in four years. it's a promise the romney campaign came up first. the obama campaign said they could do it. you would have to have the number of jobs each month we're not at. if you were advising president obama how to make jobs, how to make that promise by the end of his first term, what would you tell him to do? >> it's not sacrilege because he's all of our president and we all care about our nation. we have a structural problem now called small business. right now, there are more small businesses failing and fewer storing than any time in the last 40 years. that's important because small and new businesses create about
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two-thirds of the new jobs in this country and they hire about -- employ about half the people. when you have small business flat on its back, that's a big problem. >> if you tell the president how to fix it, what's the problem? >> first, we must lower our tax rates and vastly simplify our tax code. this should be a bipartisan cry because simpson-bowles said the same thing. >> do you think the current tax code favors the multi-million dollars companies with tax accountants? >> want works well for big government and big labor but not for small business. when you have a 26,000 tax code and small loopholes. small businesses don't understand it, can't take advantage of it and uncompetitive, the highest in the world. the second thing we need to do- >> the big businesses don't pay the big tax rate but small businesses do. >> they do or they're filing under personal tax rates and those are going up as well, have gone up. they're getting hit both ways.
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credit isn't falling to small businesses still. third, 70% of small businesses say government is hostile to them. if you ask them why, they say, i don't understand how to get started anymore. the regulatory thicket is choking the entrepreneurial life out of the economy. >> is that because of the obama administration? >> part of it is, yes. but in fairness, regulations have been growing year after year for 25 years. we have a thicket of regulations. no one ever repeals a regulation. lots of people add to them. >> fixing jobs is fixing the small business environment? >> i believe so. >> let me ask you something for years companies have been moving forward with same sex spousal benefits and same sex couple benefits. >> we did it when i was at hewle hewlett packard in 2000. >> long before doma was addressed by the supreme court, you had briefs hundreds of companies were signing on about the same sex marriage situation.
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and we saw the supreme court make it possible for same sex couples to access federal marriage benefits. in terms of business reaction, two different reactions, this from chick-fil-a founder. sad day for our nation found in fathered would be ashamed of our generation to abandon wisdom of the ages ray cornerstone of strong societies. they quickly deleted that. and goldman sachs, the big investment bank, they're flying the rainbow flag in response. is it appropriate for companies to be weighing in on this debate? >> in some ways, companies have already weighed in on the debate because they have provided benefits for same sex couples. on the other hand, i think this is an issue that, where clarity is helpful, so now the supreme court has given us some clarity but it's clearly also an incredibly emotional and personal for so many people. my own view is the states ought to vote on this, vote on
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marriage but the supreme court has spoken in terms of benefits, so let's move on. >> big conversation among women in corporate america and women at work is sort of this lean-in conversation. marissa mayer is very young, not even 40 yet. before these women were leaning in, there was you, the first ceo of a company, you're my generation. they wouldn't be where they are if it weren't for women like car carly fiorina blazing the trail for them. i'm wondering if you think these generation y women think they can start families earlier, get married earlier because it won't hold them back from a career because they're seeing families play out on the corporate stage. certainly hope that's the case. i hope that young women coming up say, you know what, i'm in charge of my own life and i will make my own choices how to balance these things. i think it's still true the work
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life balance issue is more complicated for women than men. >> i like to call it work life imbalance. >> exactly. there is no silver bullet. the thing i notice about women, say, coming up -- i have two grabb granddaughters now, they don't feel constrained. their imaginations about what their futures can be appear to me to be much more unconstrained. that's a wonderful thing. having said that, women continue to be the most under-utilized resource in the world. they are the most subjugated people in the world. we have a long way to go but we've also come a very long way. >> carly fiorina. we covered taxes, job creation and women at work. thanks for being here. >> great to be with you. after two elections in the white house, president obama still can't shake the perception he wasn't prepared for the presidency. i'll ask a man who was there whether that's true.
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in 2008, president obama campaigned as an outsider, his message, i'm fighting washington establishment for the middle class. in four years, at the heart of the washington machine, he took the white house again. you might think he's the ultimate insider. but journalists say that's not the case. 4e has tracked president obama since he was a state senator in i illinois and granted more access than any other journalist. his new book "the center holds."
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you say something missing is this smooze gene missing from politicians. it's no secret. a lot of people have said this, conan o'brien poked fun at him during the white house correspondence dinner about him. >> some in this room have even accused the president of being distant and aloof. when i asked the president about it earlier, he said, oh -- and then walked away. >> the president has also been described as a pragmatist. if it's holding him back so much even the perception about it, why doesn't he do something to change that? >> he is trying to do something about it, playing golf with republicans and eating dinner with them once in a while. it doesn't come naturally to him. the president's favorite movie is "the godfather" and his favorite line, this is the business we have chosen. you sometimes think that the president forgets that a little bit that politics is about back slapping and making these other politicians feel as if they're being stroked and getting attention and he needs to prosecute tend to be their
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friend. he'd rather spend time with his real friends. in the book, i do try to pull back the curtain to explain what he's like when he's with those friends. >> what is he like with those people? >> he's joking around a lot. off-color stores in the book that i can't say on tv. >> really? >> about the sorts of things he says when he's with his real friends. as you say, he can't swing in public at all these pitches. he really appreciates it when other people go after his enemies for him. >> it makes him look aloof, though. >> it does. >> feeds into that story yo type. >> it does make him look aloof. he doesn't get out and make people feel included enough. he understands this abstractly. but because he has a kind of disdain for a lot of the normal rituals of politics. we saw that in the first debate, doesn't like those debates, it
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means that he doesn't have these personal relationships that he could draw on now that he's in trouble, you know. you want to be able to fall back on those relationships and he hasn't really established enough of them in washington. i think he knows it. >> do you think he's being attacked more for the irs and benghazi for more current troubles after your book than he would have been because of that aloofness and because he doesn't play the game the way he plays the game? >> no. the obstruction is the obstruction. the reason he hasn't gotten more done since the house went republican in 2010 is because anything he's for the republicans are against. that's the main reason he's having trouble on benghazi and the irs. i do think that particularly with democrats, when he -- they have to go back and tell their constituents, i haven't talked to the president in 18 months, that doesn't make them look very good. it gives him less of a cushion
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of support when he does get in these situations. >> you mentioned the democrats. just this week, house minority leader, nancy pelosi stopped short of endorsing hillary clinton and endorsed her and took what some read as a swipe at the president. listen to what she said. >> if hillary clinton were to run, and we think if she ran, she would win, i believe she would be the best prepared person to enter the white house in decades. >> that would mean more prepared than the current president. >> that's -- i don't see that really as a swipe because the president was so inexperienced. he was only elected to the senate in 2004. he became president in 2008. he barely stopped by the senate for a cup of coffee. hillary clinton has been in public life a long time. nancy pelosi actually has a good relationship with the president, as does harry reid. it's more the other democrats he just doesn't smooze with enough.
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>> recent memory, the president was at a white house correspondent's dinner and known knew who he was. >> he actually came up to me at that dinner in 2003, he came up to my table at that dinner and he said to me, just remembering this for the first time in years, you're one of the only people i know here. obvious obviously, he has gotten to know an awful lot of other people in that room. when he wants to turn on the charm he can be very charming. but there's just this sense in washington that he needs to use that charm more effectively. >> in the book, he was worried during the election that if he lost, his presidency would be a footnote to history. now, he's got the second term and these new problems and new, you call it obstructionism, new problems on the hill. will he be able to build out his legacy? you know this man. will he be able to build out his
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legacy? >> i think what's going on right now is critical on immigration reform. much bigger than the various controversies that have dogged him the beginning of this year, a significant part of his legacy if he gets it. the story i try to tell in "the center holds," how did he get 71% of the latino vote. if he got 60% we wouldn't be having this conversation because none of the republicans would be taking part. he delivered a message they will not do well as a political party if they don't get this bill through? how did he do that? he introduced people like the latina oprah. the anglo people don't even know who she is. a former tv star who did ads with michelle obama in the campaign very appealing in the latino community. did this outrage from the cave, the secret annex to the chicago headquarters of the obama campaign penetrated where these
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twenty something analytic geeks figured out all these new ways to appeal not just to latinos. >> right down the color of the e-mail. >> color of the e-mails they sent out. yellow got a better return than white. 100 other things. everybody knows obama did a better job on that and i try to explain how. >> thank you. you might need a chi chiropractor after watching the stock market. now is not the time to loosen your grip. after the break. [ male announcer ] a guide to good dipping. sabra hummus is really delicious so you might be tempted to dip more than once. ♪ ahh...don't be afraid, flip it around, go back in.
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priceline savings without the bidding. hey, nobody said riding a bull was easy and this bull market has been particularly feisty, especially when the fed threatens to take away its food, the $85 billion they're pumping into the economy. when the fed hinted they might
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do that. they have been selling everything in sight. nothing was spared. now the bad news is actually good news for the farm. the gdp report showed the economy grew at a measly, measly 1.8%! you would have expected investors to sell and run for the hampton. instead, stocks have rallied through most of the week. fears of a correction for stocks have been greatly exaggerated. what isn't exaggerated is volatility. the dow jones has had triple digit moves up and down for every trading season in june. if this is the new normal, you better get a helmet. from washington and head of an investment firm, michael, an old firm and author of "the american dream." i will start with you michael. you talk about restoring trust in your book and punishing people who cheat the system. can average investors who don't
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>> long-term i think you can still trust the stock market but short term, you know, investors questions and doubts and fears, i think feel justified. you see something like an mf global where customers accounts are invaded and customers funds disappear and then there's -- don't seem to be any consequences for management. you see these things like the flash crash and you see things like the knight trading thing and -- >> yeah. >> i think people say i wonder if this is still for me. for long term, i think it is but you see the kind of volatility, of course, in the month of june and you do feel like you really need to cinch down the seat belt a little bit more tightly. >> but, you know, if you listen to your head, really, michael, if you listen to your head and didn't get in to stocks seeing the things blowing up around you, you're poorer for it. >> there's no question that
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emotion is the foe of the long-term investor. i mean, i've said for years, if it feels bad, do it. forget everything you learned in the '70s. okay? forget everything you learned in the '70s. >> let's get a banner for that. moms and dads everywhere, if it feels bad do it. >> tattooed maybe. look. if you are loving stocks as we did in the dot-com or in 2007, or perhaps as you are beginning the love them again now, you're probably better off thinking about becoming a seller than a buyer. if you're hating stocks as you did in 2009 with the market below 7,000 on the dow, that was the time to buy so don't worry -- certainly pay attention to how you feel but you're better off as an investor doing the opposite. >> oh, richard, if we could all be robots in the investment world but we are not and this volatility is just mind numbing. used to be 50 points was a big move. now 100 points over the last couple of dozen sessions.
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one way or the other. what's driving this? >> nothing about what we're seeing should surprise us. one simple reason. the rules of the road have changed. bear in mind we have got qe3. until this qui sis, we never had qe1. qe is unknown. it's not surprising. everything uncertainty, unknown, new rules, even the fed admits it's experimental. tapering. i mean, these are all different concepts. so it is not surprising in this environment that when something is like bernanke speaking or when you have gold moving that investors are just moving with an element of herd mentality and with an element of uncertainty. >> exacerbate this? >> of course. new rules of the road, high frequency trading. everything is faster, more detailed, more pronounced. it is as if the markets are in
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glorious technicolor. >> yes. talk about the color of gold. you mentioned gold. gold has crashed. it has crashed. listen. regular investors have been saying, oh, the fed, look at the fed, manipulating everything. i'll buy gold. regular investors have been killed this quarter in gold. >> a dumb, stupid metal, the love of which i have never understood. except as a marriage band or as a piece of delightful jewelry. no. >> mine's platinum! >> exactly. that's my point. people say have a bit of gold in the portfolio as a counterbalance. what? for the day it all goes wrong. the dollar has gone up. gold has gone down. growth came back with no inflation. the run-up in gold was over, done, two years ago. the run-up, the falloff is probably overdone. a bit of gold. you can't eat it! >> michael farr, last word to
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you. >> i think market's volatility is something to come to expect. we have to look through that as an investor. and you have to find a discipline and a strategy to get your money where you need it to be in ten years or 20 years. so, try and ignore the noise. remember, the old rule in the fish market. ignore the yelling and screaming. pay attention to the price of fish. >> michael, great advice from you two. richard quest, nice to see both of you this weekend. coming up, do you follow justin bieber or kim car bashian on twitter? or richard quest. why the tweetds may not always be what they seem. the progress you're making toward all your financial goals. a quick glance, and you can see if you're on track. when the conversation turns to knowing where you stand, turn to us. wells fargo advisors.
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if you're one of the millions of people who follow celebrities on twitter, you get an inside look at what the rich and famous are up to but how can you tell if you're reading a genuine tweet or an expensive ad? justin bieber gives tips on where to buy mother's day flowers. miley cyrus raves about airline carrier and kim kardashian tweets about lip balm. how do the 18 million followers know if she's getting paid or really loves the chap stick? >> it is really important for the audience to be able to understand when someone is endorsing a product saying positive things about it whether they have been paid to do that or not. >> how long until your mom fixed
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-- >> they used celebrity endorsements to push their products. >> guys? >> a famous spokesperson gets a brand more attention and credibility. now social media opened up a new world for advertisers. they can okay tesz a star's millions of followers with a tweet. but that attention doesn't come cheap ranging from a couple hundred bucks to tens of thousands of dollars for a little tweet. the federal trade commission requires companies to disclose a paid advertisement. >> we don't have words to be used by ad is very clear. >> some celebrities are using the disclosure. like when hillary duff wished her husband a father's day and charlie sheen so he knew he was compensa compensated. >> the beauty is ad and should be easy to do even in a tweet. >> with 140 characters to spare, some say there's no room for an extra hashtag. thanks for joining the
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conversation this weekend on "your money." we're here every saturday and sunday. find me on facebook and twitter and which can out our blog. hello, everyone. i'm fredericka whitfield. this hour in the "newsroom," the intense heat in the west is getting worse and really dangerous. a live report from one of the hottest places in the country next. surveillance video and phone records provide a timeline of where nfl player aaron hernandez allegedly was when odin lloyd was murdered. cnn takes you on the route police believe hernandez took that night. and hip hop legend rev run is joining us live to send you a message about your health. it's something that's


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