tv First Business KICU September 5, 2013 4:00am-4:31am PDT
the defense stock that is on the rise as the market reacts to tension in syria. in today's cover story....bouncing back. five years after financial crisis, a status check on the economy. plus...does retiring abroad get you more bang for your buck? and....is the box office in an end of summer slump? first business starts now! you're watching first business: financial news, analysis, and today's investment ideas good morning! it's thursday, september 5th. i'm angela miles. in today's first look: revved up rally..ford and gm posted the best gains of the year in wednesday's session. stocks overall rose yesteray -- on sold sales numbers from the auto sector. gold and oil both
fell even as the senate moves closer to strike on syria. blackberry shares are in focus today on a wall street journal report the company is speeding up efforts to find a buyer. intel shares fired up yesterday as the tech company unveiled new chips for data centers and cloud computing. shares shot up --- 2.5%. and trouble continues to nag the nasdaq. the exchange had 6 minute issue yesterday just about two weeks ago-- trading in stocks stopped for 3 hours. todd horwitz of average joe options joins us on this thursday morning. good morning to you. > >good morning angie. > >as we move closer to a strike on syria, how is the market likely to react? > >you look at the market and the market came out tuesday with the relief rally that there was no strike. yesterday the market was higher. so it looks like the market would prefer not
to have a strike here. so i think if we do get a strike i would look to see a little bit of selling pressure. > >you have been a big bear. the fed is out saying that it sees modest growth in the economy. how do you feel now? > >i still have the same feeling. we haven't really gone anywhere. the bottom line is we've had no growth. you take a look at walmart, mcdonalds, ups---all major consumer stocks that affect the average joe--- and they have not shown any growth. the markets are up artificially and were right up against resistance yesterday when we closed. as long as we stay below 1680 on the s &p i'm going to remain bearish. > >we are hearing this is very much a trader's market so what are you trading? > >i think i'm trading a lot of crude oil and a lot of gold and a little bit of the s &p. right now we have gold which seems to be....coming to a pretty good level. and i think oil is way overpriced here and the minute that syria is settled, i think oil comes down to about $8-10. > >gold is below $1400 an ounce. is that significant? > >i think nothing becomes significant again until we get
either to 1420 on the upside or $1350 on the downside. right now i think we're just churning in between two levels. > >thanks for your time today. > >have a great day. the g-20 summit will be closely watched by traders and investors for signs of the next step with syria. president obama is in russia for the summt today. yesterday, he was in sweden where he told reporters- credibility of the u.s. congress and the international community is on the line by not addressing a suspected chemical weapons attack in syria- by the country's leader bashar assad. protestors against a military attack were also in sweden as the president spoke. back in the u.s. a senate panel approved a strike on syria. syria is a vitale importance to iran, and their ambitions to become the foremost power in the region. they used syria to harm hasbela and attack israel. they used weapons and terrorists to destabilize iraq. now it's up to the full senate and the house to vote. so far the number of undecideds in the house far outnumber those for or against a military strike.
the tomahawk cruise missile will likely be the weapon of choice if the u.s. approves an attack in the syrian civil war. the missle is made by raytheon and was used in the strike on libya in 2011. despite threats of defense budget cuts-- in the second quarter-- raytheon reportedly had an increased net of $32 million dollars on sales of the tomahawk. the guided missiles are reported to be worth $1.45 million dollars each. the white house has ordered 196 tomahawks for fiscal 2013. ratheon shares are up more than $10 dollars in the past couple of months and have nearly doubled in the past 3 years. the short answer is, no. not yet. but five years after the september and october 2008 economic free fall, our cover story takes a look at how far we've come since that bleak time. five years ago, the federal government took over fannie mae and freddie mac. a week later,
lehman brothers collapsed. and unemployment was sliding downhill six times faster than its been improving and got worse for another year. so how are we doing now? "we had eight million jobs lost and six million have come back in basically four years." the truth, rosemany haefner says, is those two million jobs may never come back as before. it is particularly tough for older workers. "it's very difficult to get back to that income level, no matter who you are." that pessimissm was repeated in a survey sponsored by country financial. "things have improved. i just don't think they've improved quick enough for main street middle america." unemployment, is higher than it was five years ago. but it's improving not getting worse. 44% of companies careerbuilder surveyed are hiring full-time. same as last year. another 31% will hire part-timers..ten percent higher than last year. "i think you're seeing a shift.companies want to see if there's enough business to
support this full-time resource." finally, economists point out there wouldn't be an uptick in housing if people were unsure about their future. same for auto sales. "we're finally seeing seasonally adjusted sales back to the 'good old days' before the recession." gm, ford and chrysler all reported double digit growth in august as compared with a year ago. ford had its best month in seven years. honda, toyota and nissan posted even bigger gains year-over-year. there is debate as to whether consumer confidence or older cars kept limping along until now is behind auto sales rolling along. regardless, ford says it will increase production in the fourth quarter to meet rising demand. momentum is picking up again in mortgage applications for home buyers and re-fi-ers. mortgage applications jumped 1.3% last week. the uptick is attributed to a dip in loan interest rates
-- to 4.73% on a 30-year fixed rate down from 4.8%. refi applications also rose more than 2% last week. borrowing rates hinge on treasury yields which have been trending higher on speculation the fed will begin tapering its monthly purchase of $85 billion worth of mortgage backed bonds. a shortage of lots could cause a spike in home prices. usa today reports ...the average price of a finished lot in the u.s. is up 40% from the same time last year. san francisco, oakland, atlanta and las vegas are seeing the largest price hikes. lot prices are said to reflect 22% of the price on a new house. jed kolko of trulia tells us there is still room to grow for new home construction. construction in the us is still about 40% below normal levels. now some of that may be due to the difficulty finding lots, and the challenge in finding skilled labor for construction projects but i think the bigger
factor is there's still not that much demand for new construction. there's also a shortfall of developers. following the housing crisis -- many residential developers left the industry, and have yet to return. apple will hold nearly simultaneous media events in the u-s and china. for the first time.. apple is expected to unveil its latest iphone september 10th. now comes word that the company has invited chinese media to an event in beijing on september 11th -- just hours after the u-s gathering. there is speculation that apple will also reveal a deal with a chinese telecommunications company. microsoft has a launch date for it's next generation xbox. xbox one will be available in stores november 22nd. it will carry a price tag of $499.99. the tech company is already warning of possible shortages. the game console has sold out in pre-orders at some retailers. xbox one has received more pre-orders than previous game sets. it's official -- samsung has taken the wraps off a smartwatch. a big step forward into the latest realm of
wearable tech devices. galaxy gear users will be able to place and accept calls on the device. it also has microphone, camera and video capabilities. consumers will also be able to access email. samsung is specifically marketing the watch along with its new note 3 phone. both will be available in october. are interns learning on the job or are they just unpaid employees? it's a question being raised in a growing number of intern lawsuits and by grassroots groups that aim to end the practice. one group: the fair pay campaign, is taking the fight to college campuses this fall. hoping to end the role that schools play in helping students get unpaid internships in return for credit. rona borre, the ceo of instant technology in chicago says given the controversy.... unpaid internships will soon be a thing of the past.
"i think paying for interns will probably be the future of organizations. and i think that gives people an opportunity to really get more involved in your organization, and ask for things. different expectations can be set for job responsibilities if you're paying for someone's work." many companies still contend that the internships help students make connections, get experience and find jobs. at least two hedge funds haven not given up on j-c penney. glenview capital mangement and hayman capital management both revealed in regulatory filings yesterday investments in the ailing department store. glenview is the larger stakeholder with 20.1 million shares. hayman bought 11.4 million. jc penney stock closed up 6% on wednesday. frugal shoppers helped give a boost to dollar general in the latest quarter. the discount store reported higher profits as the economic recovery still
has consumers cutting costs. the stock bounced 6% yesterday. it's a bright spot in the retail sector right now, as profits sag at major retailers such as wal mart and target. dollar tree stock rose 3% yesterday on the dollar general report. two dow component companies are making price adjustments to attract consumers. mcdonald's reportedly is considering changes to its dollar menu. the chain is said to be testing value deals with a "dollar menu and more" theme. it's to find out if customers are comfortable with the addition of items that cost more than one dollar. proctor and gamble is selling tide liquid laundry detergent at a lower price. according to reports p&g is facing competition from arm & hammer and xtra. super bowl ad buzz is starting super early this year. football season kicks off today, but already the pressure is on for advertisers planning a spot in the big game. general motors, anheuser busch inbev, dannon yogurt and software company intuit have already agreed to an average of 4 million dollars for 30 seconds of fame.
hey boomers! instead of arizona or florida - consider this for retirement - the phillipines. how about abruzzo, italy. yeah, living out your retirement years in another country. it's happening more often. this week in san antonio there's a retire overseas conference and kathleen peddicord, an author and expert in this area and is a keynote speaker. and we have her via skype. and you live in panama city?! > >i do. i've been living there for five years. we moved there from paris. > >give me your most convincing sales pitch. why would i want to uproot myself, leave my friends, leave the kids behind and go to some exotic foreign country? > >crazy idea i know on the face of it. but the main reason is cost of living frankly. cost of living and cost of healthcare, which can both be dramatically less in a lot of other places. > >what are some of the top locations that you've evaluated? > >ecuador would be the top
choice for a retiree on a budget. another more exotic, more faraway choice would be georgetown, malaysia. one of my favorite places is medellin, colombia which sounds scary but it's not. and then the coronado beach region outside panama city, panama. > >but you really have to know what you're doing. i've actually heard some buyer beware horror stories in terms of how people can really get into trouble. they get property that they can't unload or there's a tax complication. > >definitely. there are risks. there are pitfalls. and as you say you need to be prepared. > >to be sure it's a good fit for you and your finances, who do you talk to. do you have to talk to an international tax expert? your accountant? maybe a laywer? > >you need to talk to a tax expert. and in fact you need two. you need one as an american in the united states and then one in the country where you decide to move. > >how big is this getting? you 've been in this business a long
time. i have to believe when you started it was kind of a strange exotic story you were selling. > >exactly. i've been covering this beat almost 30 years. when i started it was fringy, it was crazy. today, it's almost mainstream. > >i don't think there's anyone else i've heard of in the line of work you're in. what's your website so we can get more information? > >it's liveandinvestoverseas.com > >kathleen peddicord, thank you very much and hola to you! > >thank you. a home financing program that's popular with senior citizens -- is getting closer attention from regulators. starting october 1st-- hud-- the department of housing and urban development will tighten up restrcitions on reverse mortgages. it's a special home loan allowing homeowners to convert equity in their home into cash. something hud will stress is helping seniors avoid unwarranted fees. coming up.... the butler keeps climbing at the box office...but is it with a little help from friend.... and....bad news is giving one tech stock major buzz....thats later on in chart talk.
here. eric, how much of this is the oprah effect. i noticed she was tweeting and telling people to go. > >i don't think oprah needs to be tweeting. i think the will of the 99 percent are really getting the word out there just fine. word of mouth. it's making people cry, people are telling their friends. my mom's even seen the movie. > >did she like it? > >she did like it. > >my parents liked it too. i loved it. i thought it was terrific. what do you think is the future for this, because there's not a lot coming out in september... > >i don't know if it's ging to keep the number one spot this weekend but it's gonna be in the top 5 at least for a couple weeks. it's gonna be in the top 10 at least until early october. this film's gonna shoot past $100 million and immediately going to make it worth speculation that it could be in the oscar race as well. > >you mentioned that this could be a situation like we saw with the help and word of mouth just keeps growing.
> >absolutely. > >at the box office last weekend it did come in number one, thanks of course to the four day weekend---it was a big one at $20 million... > >instructions not included--- did you hear of this movie? > >not really. > >yeah, no one really did. we got some press releases about it. we heard it was coming out. it was not screened for critics, we didn't get screeners. there are only 4 reviews up on rotten tomatoes whe this film came out this weekend and yet it seemed like the latino community came out to support this eugenio derbez who is a television star. and you're gonna see hollywood take notice of this because no one saw this coming and clearly there's obviously a market---just as the butler for african-american cinema. obviously there's a market for latino cinema too. so you're going to see some people try to capitalize on that now. > >the audiences are speaking loud and clear. well, here's what's coming out this weekend. so you tell me what's gonna happen here....small, small screens. just a few here and there throughout the u.s. but i wanted to put them on the list nonetheless. > >it's worth mentioning. who knows, it might be the next
instructions not included. but riddick is obviously the big film this weekend. it falls into the category of sequels we didn't need at all. they screened it late for critics so not a lot of positive buzz. vin diesel actually sort of mortgaged his house to sort of help get this movie made. the chronicles of riddick was kind of a bomb for universal. this one's a lot more modestly scaled at $38 million. so it might take number one this weekend but i don't know if anyone really has interest in this character anymore. > >i love these filmmakers though that are going to all odds just to get their films made. > >absolutely. it's nice when you see a passion project like the butler and you see people throw their money at it to get it made. that's sort of inspiring but vin diesel mortgaging his house on this trilogy that has kind of a cult base at best, i don't really understand it. we'll see this weekend. > >i also noticed the overall numbers have dropped off as well. just the overall totals at the box office. > >that comes to pass---we're
at the end of summer. we're in sort of the school period now. so in september you're going to see some very light box office numbers. and then next week we'll be talking about some movies that are getting a lot of buzz coming out of the telluride and toronto film festivals. you're gonna see some of those movies really pack a wallop. > >we'll look forward to that. thanks again eric. > >thank you. just ahead--why micron tecnhology is suddenly a hot stock. chart talk is next.
bad news is turning into good news for one tech company. joining us now is matt cavanaugh of cmz trading. good morning matt. > >good morning. > >micron shares rallied because of a fire at one of its competitors. what do you think about this stock's story? > >it's tough to make any of your investing decisions based off of a news story like this or coming out of another country but i think it's really just icing on teh cake. this stock is up over 100% in the last year. it was below $10 in may. a lot of good things are happening for them. they aqcuired one of their competitors who has a nice contract with apple. there's good things happening in the chip industry as a whole. a lot of people have gotten short this sector after the runup so i think it's a whole mix of things going on here. > >what's happening with the shorts matt? > >i think the people who sold the stock short---and there's
been a big increase in the last month or so---they might have seen this news story coming out of china and thought, hey maybe i've got a cover a little bit. so, a little bit of a rally based of shore covering. a little bit off of the news but overall there are good things happening at this company. they've come off a really good quarter and i think if you like a stock you buy it based off the fundamentals, not what's going on somewhere else. > >what would be your price target? > >it's tough to tell. i think the stock could trade $20, maybe above. the people at jeffries agree with me. there's been a couple of upgrades of this stock lately but tough to tell. this was a high flyer back in the internet days---above $80 a share---belwo $10 this year. so really you don't know but good things going on. > >thank you matt. > >thank you. we are out of time for today.. coming up tomorrow-- in traders unplugged-- the guys offer chip tips-- on the tech companies they think are a ready to rally.. plus why more grand parents are shouldering the cost of college. we will be back tomorrow.. from all us at first business.. have a great thursday.
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