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tv   In the Loop With Betty Liu  Bloomberg  December 24, 2013 8:00am-10:01am EST

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bringing shoppers into the malls. 21% andaffic plunged the week that ended saturday. retail sales dropped three percent. jpmorgan plans to boost bonuses for investment bankers. some jpmorgan bankers will get an average increase bonus of 6 -- 10%. it is still money in your pocket to buy gifts. the former russian oil tycoon is opening up after spending a decade in a russian prison. you will hear what he has to say. let's get down to washington, last-minute health insurance shopper still have a few hours left to enroll under obamacare. the obama administration pushed the deadline act again 24 hours until midnight tonight after a crush of last-minute signers. peter cook has more. this was the deadline that was not supposed to move and then we
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get the notice midday yesterday that it is moving again. what happened? >> another 24 hours and the reason, according to the administration, is the sheer crush, the volume they were getting on the website yesterday and they want to make sure those people had the opportunity to enroll. it was a record day yesterday, one million visitors to health care.gov, people to sign up for obama care that would be effective january 1. that is the critical deadline they are facing. this extra 24 hours as giving those people the chance to enroll. some of the people were told by e-mail that it is too busy, come back and visit them a little bit. they did this is to give people the opportunity to sign up to boost those numbers they are still way behind where they should be in the president said it is clear their numbers
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will go up. >> the republicans are criticizing this extension? >> surprise! the fact that the obama administration keeps moving the goalposts and they were asking u and kathleen sibelius if they are going to move anything near the holidays. she did not answer the question. he put out a statement -- even though the administration is trying to bend over backwards to help people sign up, republicans are still criticizing the changes underway here with obamacare. they are continuing to criticize how it was rolled out in the first place. >> one very public sign up is the president himself. >> yes, this is interesting.
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it is symbolism more than anything else but we heard from the white house that the president himself was enrolled over the weekend under an individual plan, a bronze plan, showing that the president himself has gone through this process. he will not use this health care. he has his own coverage from the military. this is symbolism at best. the white house wanted to show the president did it like every day americans. it took about one hour and the plan he signed up for would cost him $400 per month. of pockete $5,000 out for the president of the united states. >> there is one deadline you cannot extend and that is the christmas shopping deadline. if you left all your present buying until the last minute, odds are, you are running around to the brick-and-mortar stores. out that its found is probably going to cost you.
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amazon has been slashing prices this holiday season. >> it's true, we know that if you want to get your hands on a , you are better off going to amazon.com. it turns out that even among the e-commerce giants, amazon.com is undercutting them on price. toysnd the top christmas have been tracked and on average, amazon.com for the top 100 toys undercut walmart.com by three percent and undercut target by four percent. that is a big deal and it's important because these e- commerce giants used toys to lure customers as bait to by other things. >> what about inventory? the electronics and so forth?
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>> they have to strike a careful balance. they fill about half of these toys malaise carter and they want to sell out of their merchandise but they've got to keep the top toys on hand so they can keep luring the customers in. amazon.com is doing better than their rivals. if you look at the numbers, on average, walmart.com was 50% out of stock on those items. amazon was only three percent. the reason is because of their marketplace. all of this has come at a cost to amazon? >> of course, amazon has been on a major spending spree and investing in warehouses around the country, trying to do everything they can to improve distribution and be able to ship as many items as possible. that can hurt your margins. their earnings for the last
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quarter reported a loss of $17 billion of sales. target had about $17 billion worth of sales for the last quarter but they pulled in a profit of about $300 million. they are trying to a market share. all right, thank you. moving and shaking this hour is the twitter cofounder and chairman jack dorsey. disney just named him to their board. says dorsey's perspective will be valuable since the company wants to use the latest technology to reach more people. he holds a four percent stake in twitter. he is worth $2.5 billion. for more on his well, check out
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our exclusive billionaire index at bloomberg.com/billionaires. despite a third straight year of record sales and profit for disney in 2013, bob eiger saw his pay decreased 15% from last year. that is because his salary is based on target. as good as the year was for disney, it was no 2012. joining me now is our director of north american research, all sweeney. -- paul sweeney. tell us what is it that disney missed this year? >> disney had a great year but it was not as great as the year before. is tied to hitting targets year after year. it is revenue profit target. they had a good year and made a lot of money but down a little from the year before. highest paidt the list every single year, it's very well populated by a lot of
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media executives. they are extremely well compensated. >> what were the misses? there were record sales and profits but what were the misses? side, theybox office had problems with a couple of "the lone like ranger." it did not hurt the stock but they took a big write-down for that. as wellk a hit for that as the studio chiefs. the overall growth rate was good and the core business is good, the table network is performing well led by espn and the theme parks were a bright spot in fiscal 13 and have been strong coming out of the recession. they are making huge investments in the theme park business in china in particular. >> that's very popular. >> they continue to make capital investments there and shareholders like the returns. -- the distant
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nomination of jack dorsey to the board of directors, it's quite interesting. i want to play a comment that erlichmanmade to jon about how twitter can be integrated into disney. >> i think there is a lot of potential there. available toontent twitter users around the world. it's another means of distribution. what's interesting about it is it also speaks volumes about things that are compressed and concise. we are also seeing that migration in media. yesterday's short is today's long. i think we have to be mindful of that. ceo's tends to talk about social media when they don't know how to use it for their business. for disney, what is the value of twitter? >> disney loves to connect with their consumers through all
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their properties and theme parks and cable networks. it is important to extend that disney branded deeply into the consumer's lives. to the extent disney can become part of the online social discussion, i think that is important for disney. >> what does it mean exactly? it has to be more than just promoting some tweets. >> i think disney is all about extending their brand across the consumer. for example, they can have the gets for their tv shows into their fans and have the theme parks reach out to users over the twitter account, i think that will be important. disney has always been fairly tech savvy. steve jobs was the largest shareholder of disney when he was alive and sold pixar to disney. bob iger and the board have been attuned to technology.
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they have not always been successful. disney interactive has been a big disappointment for the company. out at never figured probable model for the interactive side of disney. that is not atypical. many of these countries have had a difficult time transitioning into digital. >> they don't want to eat into their own business model? right, but they recognize that consumers are consuming their contents much differently. they have to be there and think of some models. at the same time, they cannot cannibalize their core existing business. if you look at twitter, it is not a game changer for disney. it is another avenue where they can more ingrained their product and experience into their customers daily lives. >> what do you think dorsey will add on the board? >> i think he will continue to push disney to continue to invest in their digital properties. i'm sure there are some people on the board who say that disney has spent enough money and not
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generate a great return and maybe it's time to step back but dorsey will be a board member who says you have to continue to push the envelope. you and we will be back with you to talk more about the entertainment industry including netflix. next, the on-demand video service is debuting its first original series for whodren and the producers come up with the content on television are not happy with the way netflix pays. we will hear from filmmaker ken burns. we will talk about tesla and how it makes its hotselling model s. we are just getting started on this tuesday. ♪
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>> you are watching "in the
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loop," on bloomberg television, streaming on your phone, your tablet, and bloomberg.com. bloomberg sat down with ken burns who explained the service netflix provides. he is looking forward to the next deal thatpbs strikes with netflix. >> ♪ >> my traditional platform has been, for 30 years, distribution on pbs, that reaches the largest number of eyeballs. kid i was growing up, every had memorized the entire primetime schedule. now we know we've got hundreds of choices and we can't possibly memorize and have appointment tv. i am thrilled with the access. i am thrilled with the idea i am
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flying across the country and want to watch episodes of "house of cards," i want to be able to do that. thatve cleaved to the fact the consumer is king. it is not the almighty network it the programmer says you shall watch it now. this is liberating for everyone. we have been convinced, sort of, that it works. everything is in flux and there thatt really the model sends us into the future with any real confidence the way we used to. now we are in a new area in which the middlemen reap the lion share. there are too many middlemen getting too much stuff on the cheap. dealix is going to make a with pbs and we get a large share of that because we are the most watched of the pbs shows n at the.""downto -- abby. it suggests there is a coming
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struggle when those united artists get together as they did early on in the old hollywood system and said this is not working for us. that will be an interesting turn of events when the folks who were there say this is not as good for us as the people who are not doing anything except pressing buttons. >> this holiday season, netflix is hoping its users will have a soft spot for "turbo." fu talks about the effort to grab kids attention. apparent inhas been a user of netflix knows they target kids. how is this different? >> this is the first netflix step at original content for children and it's an important way for netflix to make sure that parents continue to pay the monthly fee without thinking twice. this is a different strategy
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than how netflix unveiled "house of cards." they are not releasing the entire season at once but five episodes at a time. netflix says that kids watch tv differently than adults. they re-watch episodes and don't care whether it is in order. it means that perhaps animation was not ready. the problem for net flicks is the movie only made $80 million at the box office. made $283it only million. >> what are the analysts saying? >> one analyst says that this really is a big deal for netflix. he estimates that half of the netflix subscribers are those with a child in the household. he says original kids content is the mechanism by which netflix can eventually raise prices. they may not raise prices on you by two dollars but if you have a
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child in your household, they will offer a child programming option or maybe four dollars per month. this probably will not happen right away because dreamworks is part of this deal. they have 300 hours of programming and it is to bridge the gap until the deal with disney kicks in which is 2015 at the earliest. tvy will introduce four series with marvel characters and get exclusive rights to the disney movies in 2016. >> it dovetails into what can burns was talking about. netflix does not pay all that much for content but they have a lot of it and they need a lot of it. enter in original programming, the latest stab at that because they need to stave off companies like amazon. >> it's extra ordinarily competitive in kids programming. you have disney programming, viacom with nickelodeon so you've got big media players in hollywood that have invested a tremendous amount of capital for
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the last 50 years. it is a competitive as ms.. it's a toughtflix, business to get into but netflix does not own much of their content. >> and it's not exclusive. >> that's a model that has to change. the seriesht have for the first two years but five years down the road, they have to renew those rights. >> why would they do that? why would they create programming and not demand exclusivity? it is at the early stage of the lifecycle. they said we will take whatever you can give us. much larger getting and becoming a bigger player in hollywood. they have 30 million subscribers in the u.s. and investing in original content and i are starting to cut better deals with hollywood. >> hbo owns all the stuff that makes of you can reply anything 10 years later.
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they don't have to pay any different way for it. >> that took a long time. >> it took 30 years to get there. it might take netflix 15 years to get where hbo is. >> maybe, but does netflix have 15 years? >> the online video market lice is competitive but it is a market place that is growing tremendously quickly. it is the fastest-growing segment of online consumption. they are there with first advantage. they have brand name recognition in the marketplace and hulu and amazon prime are nowhere in the marketplace. >> amazon has not woken up to focus on amazon prime video. will d couple it from amazon prime programming. >> thank you so much for that. coming up, the grand finale of 12 days of that coin in a
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moment. -- of it coin in a moment. ♪
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[inaudible] >> you are watching "in the loop," on bloomberg television, streaming on your phone, your tablet, and bloomberg.com. it is 26 ms. pas caret which means limber television is "on the markets." we will have a shortened trading session. there is still economic data out data30 a.m. has economic and there will be new home sales. we will see if the recovery continues in housing. we are "on the markets" in 30 minutes. morgan and morgan stanley have something to
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celebrate this holiday season. jpmorgan plans to boost bonuses for investment bankers while morgan stanley will increase the cash payout of year end bonuses. it's not such a merry christmas the nation's retailers this year just right deep discounts. fewer americans when shopping in the last week in u.s. store sales have plummeted 21% and retail sales dropped three percent. private equity firm kkr raise 1.5 million dollars for its first real estate fund. it will spend most of the money in north america. targetpany said it will robbery level and debt and sizable business real estate holdings. about $31 stock rose per share yesterday, breaking above its ipo price for the first time since 2007 which is the year the firm went public. for more on his rebound, i'm joined by julie hyman.
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it's been kind of a rebound for private equity in general? >> it has been, for everything. it's been a rebound for ipo's. when blackstone became public, it suffered from not the best timing. it was 2007 and the stock did not close above $31 yesterday, it it broke it during the session. it is approaching it in premarket trading today. this is on the comeback we have seen. in private equity. it has been doing ipo and selling shares. that is one of the things that has helped boosted this year. in addition to rising tide lifting all boats. in 2007, thatl was the year they did that big transition with candell. then a few years later, real estate was not the same. >> there is one company that which in 2006 la quinta
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is a midpriced hotel chain and yesterday, they filed for an ipo of that company. if a company is less than $1 billion of revenue, it does not have to give much details. we don't know how many shares, we don't know the range of the shares exactly but we know that company will become public and it was bought for $3 billion. it has about 800 hotels in the u.s., mexico, and canada and is a limited service, midpriced hotel. >> we have seen other hotel ipo's. >> from blackstone, the big one was built in. -- hilton. bought extended stay and those shares are up 20% and generally come a hotel stocks have done well this year. maybe the blackstone timing is better this time. >> you hope to get that right.
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thank you so much. sadly, today is the 12th and final day of our 12 days of bitcoin because we have loved watching matt miller spend the digital currency. on his journey, he has bought everything trump pizza to groceries and beer at a bicoin bar in brooklyn. he ventured back out to the streets of new york to bring back some christmas cheer. ?> you takebitcoin? why >> this is the second year we have accepted bitcoin but nobody heard about it last year. we accept it because i got into and in in early 2010 have been an enthusiast ever since. this is a douglas fir which is less expensive than the fraser fir. >> this big one is a showpiece? >> exactly, this is
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approximately 12 feet and a few inches. >> wow, so this is a tree we have decided on, the 12 foot er may be a pain in the a* to transport. >we've got that. transaction, sending transaction. >> mine says received. there we go. >> and here is the tray. did you decorate this yourself? >> well -- i had some help from my producer but i did buy the ornaments and the lights myself as well withbitcoin. >> so he accepts pure bitcoin. acceptsnotorious secret it as well. 15,000 retailers in the u.s.
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bitcoin. app.use the 'gift' you can buy pretty much anything with bit coin. retailers actually only see dollars on their end. >> this is what i don't get -- what is the difference between using fewer bitcoin and this app? the dealer that sold a car or a guy selling his house are using a third-party provider that gives the seller dollars and takes bitcoin from the buyer. the difference between that and what henry did and there are thousands of others, there is no third-party. he wants to hold bitcoin.
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the tour is secret wants to hold dollars. that is the split. i want to highlight -- >> they would rather pay a fee. the companies like victoria's secret and tesla, yes. i think the fee they pay is minimal. what nothing compared to you pay to accept visa or mastercard or american express, god forbid. people like henry is a bit coin and dues he is. he is holding it and wants to be using it. he would prefer it to dollars. one of the things i want to talk about is the last day of our 12 days of bitcoin and it's gotten such a bad rap and everyone thinks you can use it to buy drugs. the truth is, drug dealers would much rather have $100 bills. >> you have proven that wrong. >> absolutely, but i want to
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highlight the charity side of the movement. it is so strong if you go on bitcoin.org. arewill see that people enthusiastic about giving their bit coins to charity. outpost last year was handing out about 50 lunches per week and started accepting that coin in march and they are now feeding 1000 homeless people in florida per week and they even walked a nine acre forest that they will turn into a sustainable farming homeless sanctuary. there is a lot of good things that you can do with bitcoin. those who use bitcoin are very a champions and advocates. what better way to get people on board then to do something good? there are two motives here.
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i don't doubt the goodness but at the same time, what better way to get people on board? >> absolutely, many people involved in bitcoin are evangelists of a sort. they get so excited about the brilliance in the code. many people have a problem with central banks that are constantly debasing the currency that we usually have to use on a daily basis. they want to turn people onto this new way. it is exciting to send value over the internet instantly and for free. >> what has been your biggest surprise that you have learned? i was recently watching a clip of me from a couple of months ago where i said bitcoin is for people who want to buy drugs or do illegal things. i did not know anything about it. the day that i bought my first bitcoin, i was completely worked and how it
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what it was all about and what it was for. i have learned so much in the past couple of weeks. it is partially with the help of communities like reddit. >> what was the biggest thing you learned? >> that it is more than just an investment. it's a movement. it's really about freedom. i think that's the most interesting thing i have taken away. >> will you continue to use it? >> definitely, i have gone to bitcoin meet ups. there are some intelligent people there. i may go to a bitcoin party on new year's eve. everyone there will probably be a bit coin enthusiast. there may be some politicians. >> where is this? nick'm not 100% sure --
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spanos is very involved in owns a lot of real aside -- real estate behind cipriani's. >> it's an emerging culture. i have enjoyed your reports. >> merry christmas, betty. >> is this mind? >> you can keep this for the next hour and a half. >> thank you, matt miller his last day of the 12 days of bitcoin. we will take you out to the tesla headquarters in california to show you how their model s car can be bought with bitcoin and the shopping crunch is on and your options are limited and we will look at the winners and losers on this is ms. even -- on this christmas eve. ♪
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>> tesla motors says the model
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s is keeping its five-star government safety rating despite the outbreak of fires earlier this year. it is keeping the highest rating for crashworthiness. federal regulators opened a review because of the battery fires that occurred when drivers struck metal debris on the road. vance visited the factory recently to find out what it takes to make the model s. >> we are here inside the tesla factory getting the supersecret tour. this car gets made from scratch in silicon valley. was time was in the factory in the early days and it was quieter and people were busy but it is a huge difference now. you are doing about 400 cars per week. how big is this factory? >> about 5.5 million square
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feet. we a a volume that does not necessary take -- does not necessitate using everything but one day -- companies inad car silicon valley in the past but they said it was too expensive. you guys show it is still possible. higher price will be than perhaps some other cars right now but we are convinced that by integrating a lot of the manufacturing processes, we stayed -- we save money. >> hello. >> do you want this as a present? >> can we get a car? >> would have about 140 robots that are doing the structure of the car. car.an see the side of the
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they are putting it together. >> it is very surreal. these guys are never tired. for people used to factories, even for us, it is pretty cool. >> it is like a dance. , be sure totesla check us out on bloomberg.com or our free bloomberg tv+ app. lawmakers gave us an early christmas present with her bipartisan budget deal but it may not last. we will tell you about the spending fight brewing in new year and this will be a critical week for the dallas cowboys and tony romo. we will tell you what they will be wishing for this holiday season. stay "in the loop." ♪
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if you thinkgton, the budget battle is over, think again. peter cook is back with us and has more on all the things they left behind. what about the shutdown? is that still a threat? >> this budget deal that everyone is talking about was the first sign of bipartisanship on spending we have seen from congress in the last couple of years. this is significant and largely takes the threat of a government shutdown off the table for two years but not completely. the budget deal set spending levels for the next two years specifically, it is a cap that congress cannot exceed but it does not actually specify where the dollars need to be spent other than a specific dollar amount for defense and specifics for the non-defense side. what lawmakers have to to by january 15 is set the specific
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spending levels for programs and that is going to be a challenge. everyone says they can work it out and they have been doing this behind the scenes for several months and it is going to be a challenge. we have the threat of a government shutdown if they don't get that done by january 15. >> and they said we would not have one ever again, thank you. what about the spending part? what about the debt ceiling coming up? >> first of all, the biggest flashpoint for my once they set that top line number, that is significant. fights overe everything from funding for the environmental protection agency where republicans are not big fans and they will fight over obamacare and republican lawmakers will refuse to allocate certain money for enforcement of the president's health care law even as it continues to enroll people. that will be another source of friction and you will have fights within the defense sector
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, specific programs versus other programs. where to the individual dollars go? as you said, we've also got the challenge of the debt ceiling coming up. there is no agreement whatsoever in the debt ceiling and that deadline is february 7. we heard last night that the effective deadline is late february -- early march and we will have a show down again over the debt ceiling. republicans say they want something in return for lifting the debt ceiling and the low hanging fruit has already been plucked as a result of this bipartisan deal. they could be harder to get a debt ceiling deal done. >> thank you. this is like a scene out of the movie "gravity." these are images of nasa astronauts doing a spacewalk as they attempt to install a new among you pump on the international space station. the crew has spent the last two days resizing a spare suit for one of the spacewalkers and
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after a spacesuit configuration issue over the weekend. there was concern that one of the spacesuits took on some water while inside the ship's airlock. that was fixed and as far as we can tell, the spacewalk has so far gone according to plan. it is so cool to see that. coming up, who is winning in the console wars? what did you buy? there is a clear winner and we will tell you who it is. the dallas cowboys lose their starting star quarterback in time for their biggest aim of the season. can the veteran backup quarterback taken to the playoffs? ♪
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doern pro football, it's a die game this weekend for the dallas cowboys and i may not have their starting cornerback. this is tony romo who is known for some mistakes that have led to late-season collapses for the cowboys. on sunday, he led the team from -- to a come from behind win against the washington redskins and they play the eagles for the nfc east title. yes been reports that tony romo will miss the rest of the season
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because of a back injury. that is his backup, kyle orton. he has won only half the games he started in his career. for the record, the cowboys say no decision has been made about the tony romo status. it may be a long game for cowboys fans. meantime, it is 56 minutes past the hour which means bloomberg television is "on the markets." we had a verbal goods orders that came out better than expected, up 4.5%. equity futures are pretty much not changed at this point. we are "on the markets" again 30 minutes. coming up, how companies like target or using pinterest to attract customers to their brick-and-mortar marketplaces and the russian billionaire just released from a 10 year stint in prison, he speaks out in a rare interview with bloomberg
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television. you are watching "in the loop," on bloomberg television, streaming on your phone, your tablet, and bloomberg.com. ♪
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to the opening valve. this is "in the loop with betty liu." the countdown begins right now. >> welcome back. retailers hope that flash -- inshing prices will bring shoppers. sales were down 3% last week from a year ago. former oil tycoon mikhail khodorkovsky talks about his 10 years in prison. khodorkovsky sat down with bloomberg in a rare interview. mortgage applications have hit a 13 year low. interest rates rose after the fed decision to pare back bond buying. what will that do to the housing
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market? consumers are doing their part, november retail sales were stronger than forecast. lots of questions about how long that will last. economics editor mike mckee says it appears in america's companies are getting with the program. -- wee a horrible good saw durable goods coming in. >> better than forecast, good news for the economy. shoppers did their part, retail sales were up 0.5%, better than expected. americans do have some reason for cheer. companies are starting to loosen the purse strings. we saw that with the personal spending and income report. incomes reported up, wages and salaries starting to rise. a difference for consumers. the big question is -- the chicken and egg question -- do businesses start investing or do they wait for consumers to start spending. morele goods orders up
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than expected, three point five percent. beyond the headline number and you look at the proxy for business betting, take out the and theirplanes automakers, you end up with a 4.5% gain. the strongest since last january. companies have been sitting on a lot of cash for years. $2 trillion worth on the balance sheet that they have not been investing. because the economy was not strong enough for there was uncertainty in washington. washington has gone away, the economy is getting stronger. this could mean a lot for 2014. >> how much, how good could it be for growth? >> it could be about 1 percentage point to 1.2%. if we start to see the normal kinds of business investment. that has a feeder effect, as companies add more bodies, they get more paychecks and spend more money. we multiply the impact.
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renaissance macro looking at the current order, they raised the estimate for growth in the fourth quarter by 0.2% based on 3.5%le goods, not checking . the average for the year until this point has been about 2%. in the fourth quarter last year, just 0.1% full stop a lot of progress. >> it has been incredible. has been drawing a lot of shoppers with their low prices and promotions. holidayrapup on the shopping season, we are joined by bloomberg correspondent olivia sterns. left, done it again, shopping to the last minute. >> you are not alone. christmas eve is the fourth busiest christmas shopping day of the year. you are far from alone. a lot of stores in new york city are going to be open into the late afternoon. toys r us should be open till 9:00 p.m. macy's until 6:00 p.m. you should have gone onto
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amazon, bloomberg industries has been crunching the numbers. amazon.com has beaten out all the other major e-commerce rivals on inventory and on price. they looked at the top 100 ways over the past couple weeks. ony last did the survey december 19. on average, prices on amazon were 3% lower than walmart.com, about 10% or more than kmart or toys "r" us. it beat them on inventory. walmart was about 50% out of -- amazon.com.com was only about 3% out of stock. retailersthird-party that often charge more. me that this season, other than game consoles, there was not a must-have toy. >> there was not the elmo or the toy story doll. all the retailers put out their own list of the top toys.
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they had kids pick them out in september, what they thought would be the top toys. -yearu look at the 3-5 set. doc mcstuffins. 6-7-year-olds, hot wheels. that is something my brothers were playing with 20 years ago. for older kids, game consoles. even adults like matt miller's want those. >> adult toys. >> consoles. xbox one is number one, playstation 4. still had some xbox ones unsold, this morning they are sold out. >> my nine-year-old ones -- wants a gaming console. i've had -- or an ipad. >> you could go to amazon and
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printed out, saying it is coming. chiefant to bring in tom, gist at booze and company. he has been visiting stores since thanksgiving. stores to 10050 stores? >> yes. every single weekend. today also. >> what have you found in your research? >> it is a tremendous christmas for the shopper. we are seeing values like i have never seen before this is the ist value trayvon christmas have ever seen. whether it be an for us -- this is the most value-driven christmas i have ever seen.
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whether it he for toys or appliances. every shopper has a list. >> thom, where have you gone in your research? phoenix? >> i am in phoenix but i have spent time in new york and philadelphia, d.c. i spend most of my weekends in phoenix. >> where did you see the most frenzied shopping? at discount retailers? >> at walmart, i happens to be very thanksgiving evening. it was packed. same with toys "r" us. macy's was wonderfully chaotic on the entire thanksgiving weekend and has been throughout the entire holiday season. as well as best buy. walmart, youned saw people taking advantage of the incredible deal. 30 two inch flatscreen tvs for under $100.
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were people just shuttling them up? with seven ofady them. she was buying them for her nieces and nephews. inch tv, 32 spectacular. spectacular for consumers. you have got to think that for retailers this is going to be kind of ugly. >> it is going to be an interesting holiday season. aose retailers who have strong value proposition, they have a strong omni channel presence. bricks and mortar, clicks. they understand how to win with complexity. those who do not have that will struggle. >> all retailers say they have what you just described. who had it? >> i have been impressed with
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best buy and walmart. saw a couple weeks after the thanksgiving weekend, some marvelous extensions of the black friday sale process. macy's has been good. broad range of retailers across a lot of segments who have done well in this space. in a momentalk about the impact of social media on gift buying. thom, chief retail strategist. look at how retailers are using social media to drive those sales. a behind-the-scenes look at the relationship between target and pinterest. we will tell you about the 500 &e" duckreasons a dynasty" might want to resolve their dispute. ♪
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>> retailers this holiday season
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have been grappling with one question. to do you use social media physically get shoppers? target is having some success bridging the divide. they are setting up displays that flag shoppers to popular items from its pinterest board. emily chang went to a target and san francisco with pinterest's head of partner marketing to see them in action. is featured in target stores. that is great for you guys. show me how that works. >> they are calling out items that have been very popular on pinterest. people are visiting target.com and saying i love this rug, i will say this. it is happening over and over. they have created the signage. they did this on their own to
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call out the items that users of target.com and users of pinterest have decided are popular. >> one of the most popular pinned items this season is lf on on the shelf. -- is e the shelf. this is a big thing with kids. observes and makes sure everyone is on the nice list. it gives a report to santa. comes-- when the elf back, it sits and fun places. placeshas gotten fun where the elf sits. >> what are the retailers doing? -- what are other retailers doing? when they have used pinterest in a creative way. >> a number of partners were using pinterest for black friday and cyber monday.
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created boards with silhouettes of items that were about to go on sale. >> pinterest is starting to experiment with ads. d.c. and opportunity to make money through these partnerships and e-commerce? >> we're doing some testing with promoting pins. system, we aree in the early stages of seeing how to our users react. and what kind of results at drives for our partners. that informs how we think about a business model in 2014. >> case but has been experimenting for a long time, twitter recently hired a head of commerce. how does pinterest stand out for partners? >> they think of us more as a complement to google. when someone knows they want
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something, they can search for it. on the other side, i do not know what i want, but when i see it, i know i will like it. it is like walking down an aisle in a store. when you see it you want it. it is the experience we are trying to provide. it is feeling a gap online -- filling a gap. >> thom, joining us again. isn't this the whole thing about facebook and maybe twitter and instagram. you happen to buy things that you see on social media that other people like. is this really any different than facebook? >> i think a little bit. is idea of what pinterest doing is very powerful from a perspective of helping you create your page around what your preferences are. i have seen this year on facebook a very interesting change. that has been, for example, my
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daughter put up her wish list for her friends for their own christmas party. that was a unique twist. >> how so? >> i had not expected that kind of christmas gifting to go as public as it did. what was interesting to me was it was posting that, interesting how her friends responded. what i also saw on social media, in the stores, a tremendous amount of twittering about different types of products people were buying. >> here is where i am going. a few years ago when facebook started to take off and people were -- products or certain things were being liked. worse that any better or than what is going on now with pinterest? it is really downgraded by pictures. dominated byly
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pictures. his missesferred by because it is driven via visuals versus something like facebook -- is that preferred by his mrs. because it is chosen via visuals -- is that preferred by businesses. >> we are a very visual society. being able to see has made a difference in the shopping experience. >> have businesses, target and small businesses, figure this out? do they know more women are on pinterest. on instagram, it is more young adults. has that differentiation come out? >> the large retailers have figured it out dirty effectively. smaller retailers are still struggling. -- pretty effectively.
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smaller retailers are still struggling. we are still in the early stages. 2014 might be the year of shopper communication. you.om, thank chief retail strategist. coming up, biggest trends and hollywood. the resurgence of a certain beloved star. the billionaire who fought with vladimir putin just released from a russian prison. he gives a rare interview to bloomberg television. stay "in the loop." ♪
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>> you're watching "in the loop." if you have missed any of our interviews, watch them on bloomberg on apple tv. featuring a live streaming and
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on-demand videos. a few minutes away from the opening bell. we have the top 10 traits you will not want to miss on christmas eve. keep it here on "in the loop." ♪
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>> welcome back, you are "in the loop." 26 minutes past the hour, bloomberg is "on the markets." olivia sterns has the latest on futures before the bell. pretty much flat, pointing to a slightly higher open. some data on durable goods showing that they rose more than forecast for november. expecting to see pretty light trading volume on christmas eve. stock market closing at 1:00 p.m., bond market closing at 2:00 p.m. s&p up 28% year to date. the markets again in 30 minutes. let's count down to the open
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with the top 10, the only trades you need to know about. olivia stays and julie hyman joints. number 10, 3-d systems. 95sing its price target to dollars per share to $85 per share. the analyst says the product printers are met with optimism. shares up 150% this year. agreeing nine, yahoo! to meet with a mediator to resolve accusations that it intercepted e-mails for its own gain. time warner cable. regulators and lawyers said few regulatory or antitrust barriers would prevent a possible acquisition of the second-largest cable operator by any of its three largest competitors. we have been talking about the possibility it might be acquired. saw a third straight
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year of record sales in 2013. ceo bob eiger saw his pay fall 15% from a year ago. iger saw his pay fall 15% from a year ago. >> the company that delivers wireless access and computer technology was cut from overweight to equal weight. the outlook for the current quarter fell short. shares are up more than 200% this year. puma biotechnology. bank of america raising its to $141.get from $118 it's anticancer drugs establishing strong proof. sharesbook and twitter hit record highs yesterday on optimism that social media
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advertising will grab a bigger slice of the market for digital promotions. scientific, the company that makes and markets minimally invasive medical devices is planning to expand in china. planning to open surgeon ingining centers and eye acquisition in china as it faces regulatory talent is at home. "turbo ix is launching fast," its first original program for kids. netflix winning an emmy and 300%ing its stock plunge since january. the biggest gainer on the s&p. a fast snail. >> number one, tesla. founded by elon musk and keeping its five star safety rating for the 2014 model year. the national highway
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transportation organization affirmed the rating despite battery fires. we are all getting into the holiday spirit. nutcracker ofe the new york city ballet ringing the opening bell. joining us from chicago, alan market analyst for trading advantage. hard at work on christmas eve. the biggest question on investors' minds, whether institutional or retail, can we repeat the same games that we saw in 2013 next year? >> that would be a very high bar to set. higher, ande market very optimistic. i think it has been a tragedy that people have not believed in this year. this was the year where the contrary is -- you had inability to foresee that everybody is so negative. you saw the market rally. i am looking for 6.5% in near
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term. we still have more upside. as apple goes, people's fortunes will follow. we had a breakout, a $60 move. that is about 6.5% higher. >> it is a big market cap company and it has been a stock that we have watched. come on, apple products are losing more and more market share. >> well yeah. they will get it figured out. it got overly beat down from a technical standpoint. turns its fortune, it is not participating. it is carrying the nasdaq in upside.ent leg to the it comes back to -- everybody has an opinion. they were wrong about the market this year, they thought they would be a correction and a selloff. those marketsat that have not moved or people leaning in one direction and look the opposite way. gold is something to look at. we are seeing bullish
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divergene. ce. we made new lows but did not and highs in relatively -- volatility. look for some relatively. everybody is so sour, the market will typically go the other way. >> alan, thank you so much. >> happy holidays. >> from the tray to the call, -- trade to the call. margie's call is accentuated positives. you could be giving up returns. that could be a lesson for 2013. going to think it is be another good year for investors. this was a great year but next year will also prove to surprise people by having better returns than what people were thinking. people think the market has gone up so much it must go down.
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the fundamentals look terrific for the economy. from 2013?same gains is out oft sure it the question. this year, the major averages were up 35%, that is a high hurdle. equities will do better than any fixed income alternative. who is to say that with a strong economy accelerating that we may not even approach those levels again. we will do better than bonds, that should be good enough for most. >> there are a few pockets of the market you like. one is consumer stocks for sun selling domestically. olivia, you're looking at that. is no stopping american shoppers. consumer spending has been a bright spot of the recovery. one of the reasons we saw third-quarter gdp, and at 4.1%. there has been a runner-up and consumer discretionary stocks,
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the best-performing sector in the s&p 500. these are the top three performing consumer discretionary and stable stocks. -- and staple stocks. these stocks are now looking pretty expensive. the s&p consumer discretionary index is trading at a pe theiple of 21, compared to overall multiple of about 500. i am wondering how much move there is for them to keep rallying. >> isn't that a warning sign? >> i don't think so. staples and discretionary are going to be good sectors. reflecting better consumer wealth and more employment. i think it will be more of a safe part of the market that we can count on. >> olivia's point, hasn't that already been priced in? the optimism there. lookthink you have to ahead and say what sort of fundamentals do they have for future growth. with consumers' expanding
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incomes and employment expanding, those will do well. inflation has been a boon to consumers because it has been so low. you like, pocket that another area is the shale boom in the u.s. that has contributed to a great number of jobs. julie, you are looking at that. oil am looking at u.s. production in particular. because of the shell of revolution we have seen -- revolution,he shale we have seen u.s. oil production sore. -- production soar. some say the easy oil has been gotten, you might see costs rise. you might see a margin s queeze one it will be more difficult to get the oil out of the shale. >> has the low hanging fruit and plot -- been plucked? >> i don't think so.
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companies have been on a tremendous learning curve. they have become so productive and learn so much about how to harvest liquids from under the earth. i think they are not seeing margin pressure from costs rising. they are overcapacity in a lot of sectors. costs are not going to be a problem. think -- >> thank you, margie patel on the call. from the patriarch of the "duck dynasty" empire, it may have cost him and a&e a lot of money. ♪
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>> here is a look at the top tech stories. a&e and the family behind "duck
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dynasty" are in damage control mode after the patriarch made anti- gay slurs. taking into account merchandise sales and advertising, the price tag on this comments could come out to a little less than the $500 million. that is a costly comment. a consortium treated by apple, microsoft, and other giants to acquire patents from nortel in 2011 is holding escutcheons to -- is holding discussions to sell. they have been in conversation with possible buyers. in 2011, the patterns were highly sought after. microsoft selling more consoles on amazon than sony. xbox one sales are outpacing p s4.
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of boths sold out consoles. catch the latest every weekday at one on "bloomberg west." microsoft and xbox, a hit. christmas eve for the last-minute shopper. some of you are deciding which movie to go see. "wolf of wall street" and "secret life of walter mitty" opened tomorrow. reeves, whereanu did all this time go? joining me as paul sweeney. sweeney.l this year has been so interesting for movies. you have takeaways. stars, keanu reeves, sandra bullock. they have come back to dominate. >> you think about kid movies
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and the comic book heroes. those are the big franchises back at all the headlines. successes withe older skewing movies like "captain phillips." >> "12 years a slave." skew towardss that older demographics are doing pretty well. >> we are talking about what? 45 and older. they have a lot of money to spend. >> that is a conundrum of hollywood, do you focus on big-budget movies with car chases that can work globally. youmuch of your budget do allocate to things outside that genre? adult is oneet the of your four takeaways from the box office. one of the other ones -- the second one is long live the
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sequel, the franchise. >> if you look at the top 10 grossing movies, seven of them are sequels or an existing franchise. "gravity,"ccessful relyollywood continues to on formulas. one of the reasons they fall back on franchises is because they know that those franchises will play globally. right now, the global box office outside of north america actually accounts for over 60% of global box office receipts. that is up from 50% five years or six years ago. is international box office becoming increasingly important. it is almost impossible to get a blockbuster if he does not have global appeal. talking -- while you were talking, some news came out on the cable side.
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have been watching time warner cable given the possibility of an acquisition. they are saying they have reached a long-term, multiplatform pact with viacom. they are going to renew their distribution pact and make e-pics available to subscribers. is this significant event all of the chatter about time warner cable and whether it can say independent. it shows time warner cable is going on business as usual. coming to a program distribution agreement with one of the largest programmers, viacom, is very important. investors are focusing almost entirely on what the ownership structure is going to be. will there be a consolidation story and cable and 2014? going to be a consolidation story, a lot of
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investors see time warner cable as the first to move. >> back to box office. he talked about -- you talked about, movies are a game of hits and misses. >> hollywood chiefs are almost a portfolio manager. you make two dozen movies a year hits to for 2 or 3 offset misses. disney had success with the marvel projects, "the lone ranger," they had to take a write-off. going to marvel model be a model for other studios? disney really focuses on the franchises. they put a lot of capital against that, they bought pixar, lucasfilm.
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the next "star wars" installment comes in 2015. you can expect them to step it up and tied in with merchandise and all the things disney does. they are betting big on the franchise business. >> more and more of these audiences are overseas. >> particularly in asia. china is becoming a big market. when you see big movies made, they often try to integrate global characters. global themes, if you will. trying to be specific to asia, for example. big studios in hollywood think about the content they are putting out because of the $200 million price tag, they have to make money overseas to offset that. sweeney ofu, paul bloomberg industries. coming up, he spent 10 years in a russian prison after being incarcerated by vladimir putin. oil mobile -- oil mogul mikhail
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indorkovsky is speaking out this rare interview. right after the break. ♪
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for the global outlook. russian president vladimir putin pardoned mikhail khodorkovsky last week. in a rare interview with ryan chilcote, he had some startling things to say about prison life. >> after you were released, the head of raw stuffed -- the head exists to thech assets -- thanks to the assets that were part of yukos, said he would be happy to give you a job. he was joking, even mocking you. how does that make you feel? were a's comments
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joke. i know that right up to the very end, he was trying to convince the leadership not to free me. only because he was personally afraid of something. a man who wants to joke around on equal footing and with integrity should not use the power of the state to get rid of him. .> bp owns 20% of rosneft some would say that effectively legalizes what some would argue yukos'e expropriation of assets. how do you feel about that and bp?
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agree with the idea that when you are doing business you can do anything that you want that is not forbidden by the law. what bp did is entirely lawful. it is another matter whether it was ethical and whether business should be concerned with ethics. perhaps every company and society will have to answer that for themselves. loopat does it for "in the ," live on bloomberg television and streaming on your phone and bloomberg.com. have a great holiday and we will see you back here on thursday.
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"on the markets" next. ♪
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is 56 passing hour, bloomberg television is "on the markets." we are going to check you and. chris smith he's an relatively looking at a quiet market. the nasdaq is quietly negative, the nasdaq and the -- the s&p and the dow build.
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coming inods orders better than estimated at 3.5%. the last five trading days of the year continue -- 10 to be positive. time for futures and focus. oil futures are flirting with $100 a barrel when it comes to wti. for a look at the move, i am phil at theo broker cma. you came in just to do this segment. thank you. what is the catalyst? last three weeks we have seen drawdowns. about 10shot out of million barrels six years ago. it is not out of the u.s., it is a demand overseas. we have seen exports pick up quite a bit. you are seeing inventory come you are seeing triple digit oil.
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how much ofi that is a fake out in the short what is theis -- likelihood we see a bill at the beginning of next year? >> i think that will be the case. we will be passed that hurdle. these guys are cracking that back into gasoline and heating oil. heat oil and gasoline prices are not accelerating as fast as crude oil. this topping action in crude oil and you will see heating oil and gas prices start to rise. >> what is the bottom, how much does it have to pop for oil? >> if you start seeing these builds, massive builds, 2, 3, 4 million barrels. you will see oil prices come back down to $96, $93, and anti-dollars by quarter end. havell you be a buyer, we
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geopolitical risk in the middle east and then the gulf coast. >> once we get down to those levels, you look at further out contracts like december 2014. this plays more of the geopolitical risks and it plays the longer curve, rather than short-term supply demand fluctuation. go out, go out at least to the end of the year. you talk about natural gas, that has had a huge run, 34% this year. when do we see the five dollars? >> when i do not have to wear five jackets coming into work. billion cubic feet drawdown a couple weeks ago. we are expecting high drawdowns until at least january 6. if we start to see some warmer temperatures, natural gas prices will peak around that five dollar level and we will come off from there. it should liquidate pretty fast, it is a hefty long position. like 70 degrees
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yesterday here. what does that due to demand if we get up to around that five dollar level? could i put a cap in it. >> you will not see demand obstruction, more than half of the households in the u.s. use natural gas. you will see them coming out more natural gas and trying to fulfill those needs. or they will start looking at alternatives like propane or heating oil. then you will start to see prices come down. i don't think natural gas does any business around the five dollar mark, it should be 350. it will come down. at fiveal gas, topping dollars, wti, topping at 100. that is our call from phil, thank you very much. we are on the markets again in 30 minutes. "market makers" is up next. ♪
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>> live from bloomberg headquarters in new york, this is "market makers." >> housing health. the lasting economic data point of the year is out. breaking news on home sales. out of prison. the jailed russian oil tycoon still enjoying his first days of freedom in over 10 years. he speaks to us about the worst part of prison. eb

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