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tv   Street Signs  CNBC  December 4, 2013 2:00pm-3:01pm EST

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on one hand new home sales rise to the most in 30 years and jobs report ta is way better than expected and budget deal in d.c., all good news. on the other hand, stocks are heading for their fourth straight loss. blame the fed, maybe. more on that in minutes. let's get breaking news from the fed and how america's regional economies are doing with the beige book and st. louis. be -- and steve liesman. >> the beige book is a 2% beige book, 2% growth, the economies the beige book says continues to expand at a moderate to modest pace. the manufacturers did activity continuing to expand in most districts and the gains were seen in autos and high tech. manufacturers that were optimistic about their growth prospect. consumer spending increased in almost all districts at that 2% pace. retailers were hopeful but cautious about the holiday shopping season and sales of autos were moderate to strong. residential real estate improving across most districts
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and some gains in loan demands and several districts, reported easing of credit standards, something they've been waiting for for a while. some concern may be about hiring. up moderately in five districts but really unchanged in seven of the fed's 12 districts. there was difficulty finding quality workers. we've heard that time after time. some declines from the federal government shutdown se questions trace, other anecdotes were not so conclusive. concerns about fiscal uncertainty in the future could dampen demand. price inflation contained and employers were concerned about future costs of health care programs. so brian, essentially what we're hearing is that this is not really a big change, not to the downside, not to the up side. right along calling it a 2% beige book. >> thanks, steve. >> again, lot of moderates and modest used in describing the economy. how the markets are doing off session low. the dow down by 0.6%.
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91 point loss. the nasdaq down 21 points, the s&p 500 down 11 points. this is, in fact, the fourth straight day of losses here. the big story comes from housing and new home sales. not just rising, but jumping the most in more than 30 years. our real estate pro diana olick with us now. how did this happen, diana, and interestingly the home builders, they're not doing much, down today. >> yeah. because the real question is, did it really happen? several analysts are saying this number will be revised down just like earlier numbers were. that said, contracts signed to buy newly built homes jumped 25% in october month to month after falling 6.6% in september from august. you have to follow this. you're talking about seasonally adjusted annual rate. that means if this many homes sold this month this would be how many homes would sell in the whole year. the rate in august was originally reported at 421,000. today we learned that was revised down, 15%. and the numbers then fell from
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there in september to 354,000. that's a 10% drop year over year. all of a sudden the numbers jump 444,000 annualized in october. that's your huge headline. but deutsch bank put out a note after saying we are skeptical of the strong october reading because it runs counter to nearly all other anecdotal builder and mack kro data. we expect revision or some reversal to october's significant gains. he was not alone. we have been talking to some home builders today and they had some observations worth sharing. steven alloy of stanley martin homes said he had big traffic even over the thanksgiving weekend. he's convinced the jump in mortgage rates is scaring potential buyers into signing on the dotted line for fear rates will be higher next year and alan lang at pennsylvania based orleans homes says they saw a bum after the government shutdown ended and he says that
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has continued. now mortgage rates have been on the rise all week and if we get a stellar jobs report on friday, they will go even higher. much more on-line real realtycheck.cnbc.com. >> a big if. if we get a stellar jobs report on friday. thank you very much. will we get a stellar jobs report on friday? me ro chief financial economist dan, and dan green house and jed. because you focus on homes i'm going to start with you. are these numbers as good as they seem on the surface? diana seemed to think no. what are your thoughts? >> i agree with what diana was saying. the real increase in new home sales i think looks closer to about a 5% increase year over year. not a 25% increase month over month. the new home sales numbers are always somewhat volatile but now given that we've had this mortgage rate spike and the government shutdown we could see a lot of people shifting around the timing of their new home sales in response to those factors. >> jed, it's not as good as the
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headline but is this still good news? >> it's a modest improvement in new home sales. ultimately new home sales depend on construction. you can't sell new homes if you're not building new homes. remember, construction is still far below normal levels. construction is running at about a 900,000 annual rate. normal is about 1.5 million. construction and new home sales still have a long way to go before they're back to normal. >> the other knock against these numbers if one were to characterize it as such, diane, this is a very small part of the overall housing market, new home sales, compared to existing homes? >> exactly. and existing home sales have been extremely weak in recent months and mortgage applications haven't been stellar. putting them into context is really important. the other issue is the point that we need construction activity. that's where the bang for the dollar is in terms of the actual job gains out there and much of the construction activity we've seen even though it's suppressed has been concentrated in multifamily homes where you don't get as much employment as
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you do actually in a single family housing market. we're still not seeing the single family housing market like we'd like to and that's a critical concern to the federal reserve. they're worried about what's going on in the housing market. housing got us into this, housing has got to get us out. >> the other part of the story is the story of the markets, the rise in the ten-year yield touching 2.85%. what sort of impact as diana had mentioned bring buyers to the table ready and willing to sign because they're worried about mortgage rates going up more or will it put a dent in the recovery. >> that's everyone's dream that higher rates pull people off the fence into pulling forward activity today instead of delaying it over the next say one to three quarters. in a simple sense our view is very easily that there is a level of yields that quote/unquote breaks the economy, that breaks the market. 2.5, 2.7, 3% is not itp. so i think there's a lot of
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nervousness attributed to the backup in yields. if the economy is improving as the data seems to be suggesting or at least as we believe in 2014, then you should get higher yields. the worse scenario is you get lower yields. >> dan, today sort of per son fi more than any day recently what has come to be the idiocy of this stock market in some ways, right? maybe the new home sales number was not as great as the headline but still not bad, right. adp unless you want to poo-ppoo how that's grated is a pretty good number. and yet, stocks fall. that sort of good news is bad news thing which i have to imagine is driving our viewers, your clients, the guy on the street, insane? >> i mean listen, the idea is obviously the economy gets better the odds of a reduction? asset purchases in december goes up, yields should go up and stocks down in a short term.
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taking a step back from the fed december meeting, no one thinks as the economy gets better and fed pulls back they're going to be able to thread this needle perfectly and no reaction in risk assets whatsoever. the question is whether or not the reaction is appropriate and more importantly sustainable. once this dislocation, people move past nervousness about the fed, once that all runs its course, the bias remains to the upside for the economy and stocks. >> diane, what your expectations throughout the december fed meeting? does anybody think anything is going to happen then sp. >> i think the fed is going to set the stage for the tapering process. they're nervous about the asset purchase program. they believe holding long-term rates lower longer for a longer period of time is a better way to go. they have to convince financial markets to do the pivot away from the asset purchases to this sort of we're going to hold rates low until the punch bowl is out there drained and everybody out on the dance floor longer than we ever have in the past. that's the message the markets aren't getting.
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communication haven't been perfect by the federal reserve. the december meeting critical on communications. >> if you take a look at the yield curve, it's as steep as it's been in quite some time. i'm going to push back a little bit here, even though you know i think you're the best. investors are selling off the long and pushing up the 10-year yield but as long as the short end is staying anchored i think the market is starting to get the message even though they're going to back off on purchasing longer term securities short-term rates will stay low. >> you guys are too smart for -- >> keep that term premium in too. they want to narrow the term premium and keep it lower and we have seen housing sort of -- it has pulled in quite a bit since the fed did the mea culpa in june on tapering and i think there is still a long way to go on the messaging here. my 2014 forecast is an exca acceleration over 1%.
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>> yield curves, now you are speaking latin. too smart for this show. jed, bottom line to our viewers, that are not sort of market gurus, should sthey buy a home now? >> for swung thinking of buying, housing will look less affordable next year than now. prices are rising faster than rates and rates likely to be higher next year than this year. buyers who wait, though, will see more inventory on the market next year then they saw this year. it will probably be easier to get a mart gauge because looks like credit is loosening slightly. but higher prices and higher rates. that's the choice. >> pretty good. >> good discussion. thank you all very much. diane, dan, jed, take care. >> on deck, with many gdp estimates coming down, are people getting it wrong buying stocks right now? we'll dig in. >> later, herb raised the red flag on intuitive surgical robots months ago and today the
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fda has issued a recall. we'll get his take ahead. plus we found some liquid gold for your portfolio. the kind that you and i both like. >> liquid gold. >> three days in you're turning into me. don't. that's bad news. >> i got to get out of here. we'll come right back. stay tuned. ♪ [ male announcer ] this december, experience the gift of exacting precision and some of the best offers of the year
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stocks are working on what
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could be a fourth straight day of declines but don't let that get you down. you're optimistic it is a chance to buy at cheaper level. dominic chu has been scouring history for what you may want to put on your shopping list right now. >> over the past few hours we've gone through three year, five year historical data for the s&p. we're going to cap it off with a look at longer term it ten-year data. it's our holiday installment of name that stock. i know you love these so we're going to kick it off with one stock up 15% each year for the last ten seasons between black friday and the end of the year. this stock up 50 percent each year is in the health care business and guys, a big hint, it makes an eye drug called ilea which treats macular degeneration. any guesses here, guys? >> no. you caught us. >> general electric. >> not general electric. >> regeneron. this is a big one. >> my next guess.
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>> another one, though, number two on our list, another big one up pretty decently up 16%, in the i.t. business and it does software specifically lin knicks related operating software and cloud computing as well. this is an easy one. >> shappo, red hat. >> red hat. you got it. >> said it another language. the same answer. >> yes, he did. >> shap po is hat or cake. one of the two. i don't know. >> sounded good when you said it and that's all that matters. this is the one we want to end on because it's the single best performing s&p 500 stock on average between black friday and the end of the year for the last ten seasons in a row. >> that's the worst ever. >> 19% a year each year. >> worst clue ever. >> materials company and x marks the spot. >> if this is u.s. steel we're going to be fighting. >> this is u.s. steel. >> we used the same clue last
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week. >> the worst clue ever. >> we said x marks the spot. dom. that's what the banner said and we said. >> yes. this is u.s. steel. u.s. steel the best performing stock in the s&p 500 over the past ten holiday seasons up 19% a year. >> oh, yeah. >> pretty decent stock, old world materials, steel guys, kind of sexy. >> great story given that you blown it by stealing our hint from last week. >> i wasn't paying attention but i mean it's -- >> what do you mean? i thought you were a loyal viewer? >> oh, yeah. >> dom -- >> i was paying attention. >> now i like you again, dom. thank you, buddy. good stuff. u.s. steel. kind of an interesting name there. coal in your stocking, metallurgical coal. >> yes. >> for the past few months many estimates of u.s. economic growth have gone down. for the past few months the most of price of stocks have gone up. conclusion, one of these things is likely to be horribly wrong. joining us from well fargo scott and bob from ban yon partners. scott, what do you think? i don't get it.
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gdp estimates down, stocks keep going up today aside, heck of a year you get my point. somebody is going to be wrong or estimates will have to be changed? >> this has been a great year, brian, and you brought it up in your last segment. what's bad economically is good for the markets solely because it means the fed is likely to not taper for longer. so people that are calling for a fed taper are solid announcement in december, i think they are completely wrong. we're not going to see any written thing from the fed or solid guidance until some time next year. >> bob? >> the reason the market has been going up nothing else has been working. europe hasn't been working until recently. asia had some problems, it hasn't really been working for you. japan is starting to institute in change, that's going to help. china trying to stabilize and -- >> you're giving me the best and worse on a argument here. >> that's largely why the u.s. market has done so well and largely why stocks have outperformed. bonds, nowhere to go. the stock market is going to
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continue to do well no matter what the fed does. the fed is going to taper, we know it. the united states government is not going to shut down. get invested in stocks. just be aware that you're going to have some bumpy roads in the first quarter. >> you know, it's an interesting argument, do you buy it? gold hasn't done anything, it's gone down, no income from gold, right? to melissa's point, other markets until recently haven't done anything. at some point that will end and the u.s. then will become comparatively less attractive. when will that be? >> i don't think it's going to be through 2014. i think -- and i hope that we see more volatility. i would love to see the sell-off we're seeing now as minor as it is, accelerate a little bit to the downside because i think it's a total buying opportunity. i think by the end of next year we'll be at 1850, 1900 on the s&p 500 from here that's not that great of an advance, maybe, you know, 7, % on a total return basis, but if we can get a little pullback here, we certainly want our clients jumping on that and invested in stocks.
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i would love to see more volatility. >> bob, is it a worry for you that no one else out there seems to be too worried about what's going on in the stock market. nearly every strategist we have on is optimistic the stock market in 2014. >> yeah. i mean it's like joining a club that, you know, wants you as a member. you don't want to do it. i think there's a reason why everybody is so optimistic and it's because the economy in the world is actually picking up. there are some outliers, some things that we can plan for. but, you know, how can you really invest in that until you're going to, you know, be buying puts all the time. i don't think that's are what you want to be doing in this environment. you want to have exposure to the emerging markets, the china, to japan, to latin america to europe but i think your best bet is still being with the united states. >> all right. guys, thanks for your time. scott and bob. >> all right. thanks, guys. appreciate it. >> still ahead, more good news at the pump. we'll tell you where you can find the cheapest gas in the ago, straight ahead. >> some good news from the corner office. what a ceo survey may be telling
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reaching of a budget deal between democrats and republicans, house members and senators over a partial relief of the budget sequester and longer term cuts to replace that relief. i am told by people close to the process that it would be about $90 billion over two years split half and half between domestic and discretionary. that would be money added back to short-term spending on those programs, paid for by some revenue and some entitlement cuts but the revenue would not be tax increases, thing like user fee, and entitlement cuts would not be medicare and social security avoiding those hot buttons like curbing federal retirement. the negotiators hope to announce this by the end of the week so congress can act next week. remember when the government was reopened they set a december 13th deadline and democrats and republicans are reasonably optimistic that they can do that next week, guys. >> good stuff there. john harwood, we'll keep a close eye on that.
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>> this might come as good news to our next guest. a survey out shows ceos are feeling more optimistic about the economy. will that mean more jobs? ask jon engler president of the business round table and former governor of michigan. governor, welcome back to "street signs" here. before we get to the ceo survey, i just got to ask you a question about detroit. your view on the ruling yesterday? >> well, i think it's been pretty foreshadowed by judge rhodes, he's an excellent judge and this is a landmark ruling really for the whole country because what the judge has said is look, these pension benefits are contractual benefits but the purpose of bankruptcy is to tear up old contracts and try to get budgets balanced. so this is a road map going forward. a lot of legal challenges but kevyn orr i saw where he was quoted saying now the hard work begins because they have to restructure the debt, figure out how they can get an operating budget put together and a plan going forward. i'm optimistic about what this
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could mean for detroit but i'm not optimistic about what this means for a lot of people who are going to be affected and going to be -- >> yeah. >> hurting because of this. >> it's probably ultimately a story sadly where there's not going to be really any winners, right? everybody is going to lose something. >> everybody is going to lose something. there's no question. and there have been -- it's the old line, they're writing checks they can't cash is what has been going on with the government for a long time. >> that's how they got here. to the ceo survey which is the american public is happy to hear ceos are more optimistic. that's nice. >> that's good. >> people want to hears there's going to be job creation behind it? >> i think that follows investment. our chairman made that point today. investment really drives hiring and we think growth needs to be much greater than even our outlook is 2.2 gdp growth next year. that's not very good. we would like to see that 3.5, 4%. that's the kind of job growth that creates the jobs that people are looking for. the kind of jobs where you start thinking about how can i support
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my family not whether or not i can make a minimum wage. >> and you want to see gdp growth, jon, but at the same time in the survey, 73% expect an increase to the company sales over the next six months and only 45% expect no change to employment. employers seem to be gaining more with hiring less. i mean are we entering a phase in this recovery where companies realize they can operate lean and mean and still achieve sales growth? >> i think that's a good point. one of the things that we noticed is that in each case, the bit of positive movement upward was as a result of expectations being better, not pessimism lower. there is some good news in there. we just like to see a lot more of it. and capital spending was actually the category where there was the greatest ummf in the survey. you do have a fact that there's probably a lot of things that wear out. we were seeing that in the transportation industry with cars and trucks. you need to replace these at
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some point. technology is a big spend area where the new technology is better and better and that helps people be more productive. doesn't always lead to more jobs in the short term but makes the enterprise stronger. we would like to see robust growth, things like infrastructure. the budget deal that john harwood was talking about is real important because that has an impact both on business confidence and consumer confidence. that's really good news and if we go back the last couple december it seems each time we got to the end of the year there was some catastrophe we were trying to avoid in washington and that was not good news for the holiday season. >> certainly right on that, jon. we'll see what happens this december. thank you so much for your time. >> thank you, melissa. >> gasoline prices holding steady overnight but we found the cheapest gas in the nation. sharon epperson is on today's pump patrol. >> it's deja vu, national average for regular unleaded gasoline at $3.26 a gallon. that's basically unchanged from yesterday. but it is down 3 cents from a
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week ago. about a penny higher from a month before. we're also watching what is happening in terms of what aaa says normally happens for december. the middle of the month we usually get the lowest prices of the year. we already saw prices below $3.20 a gallon last month. we'll see if we get below that mark some time here in december. right now we have three states that have bragging rights for prices below $3 a gallon for the statewide average, oklahoma, missouri and kansas. and you'll find the cheapest gasoline once again today in oklahoma city, at $2.67 a gallon. that's today's pump patrolp. back to you. >> sharon epperson, thank you very much. coming up, a nearly left for dead tech giant has had an epic breakout this year. it's at a 13-year high. do you know who it is? i know you do because you read the script. >> i do. >> don't give it away. i love a penny for your thoughts on jc penney. i don't. i read that in the prompt ter.
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it's that time where we run through five stocks in the news moving on investment recommendation. we call it street talk here. microsoft hitting 13-year highs today and that was the clue that you gave before. >> yeah. listen, a little bit of news on the name. eu saying their nokia deal raises no competition concerns. that aside, the better news is microsoft may be finally turning into the company that people have been hoping it's been for about the last decade. >> i think there's a more tangible reason, that is the euro and u.s. nominated debt sale what will they do with the proceeds in a lot of people think buybacks. >> or dividend that they kicked off about six years ago. >> exactly. >> shocked the world. either way a good year for microsoft. >> absolutely. >> up 45%. >> we'll wait and see if it hits 40, hasn't done that since 2000, late '99.
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>> u.s. bancorp added to goldman sachs conviction buy list. >> they bumped out citi to group to add in u.s. bank corp citing a reexcellation growth. kind of a big call on banks. >> citi not moving too much after being knocked down a bit here. sonic we're watching. getting a big initiation at buckingham research. >> big into burgers. stock up 3.8% to 20.44 initiateded with a $24 target. 20% higher than right now. william blair upgrading the stock, double upgrade for the maker of the double burger. >> they do make the double burger? >> i'm sure. everybody does. >> jazz pharmaceuticals getting target bumps not helping the stock too much. >> not helping the stock at all. up 0.2% or 20 cents. cantor fitzgerald sends their target to $145, guggenheim securities to 140 from 105, they both met with management, they like the brand exclusivity.
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the stock has more than doubled this year. >> that's why. >> i know, but these are pretty heady target bumps. 140, 145 bucks. no movement? well, it had the movement. >> exactly. more than a double this year. today's under the radar stock, sun stone hotel investors. >> ever heard of them. >> really under the radar. >> there you go. southern california based lodging upgraded to out perform to market perform. price target of 14.50, about two bucks more. you're a reit known for yields. little odd to find out the yield in this name is 1.6%. >> and the ten-year touching 2.85 today. where is the tradeoff there. >> you get to buy the owner of a marriott and others. >> there you go. >> new month mining jumping 2% today after hitting a 52-week low yesterday. all coming amid reports they may be planning a joint bid on the massive copper mine in peru. loss bombbass aside is that
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enough to buy new month mining down 50% on the year. start talking numbers, andy bush joins us on the technicals and jason on the fundamentals. jason, with you, the stock down almost 50 percent year to date, some rumor or discussion of a copper mine purchase make any difference in your investment recommendation? >> thank you, first of all. well i do like copper at these levels i don't think that's a reason to really you know go long and strong in numont. so many ridiculously important head winds against gold and therefore against newmont right now. the taper. any time you talk about gold you have to talk about interest rates, and the fed's policies and gold is trying to price in the future of rising rates and guess what? we're starting to see that. the 30-year bonds down a point almost at 4%. i don't think we're going to see newmont or gold have a meaningful rally because of the rigz interest rate environment.
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>> all about the balance sheet and gold is around 1200 when the rumor start about dividend cut. will the company need to cut its dividend in order to have an operating flow here. would you go in and buy at this point or is that a concern for you? >> well, it's one of many for newmont. this is a stock that's been a dog this year as the rest of the stock market has gone up, this has gone down. what i want to point out two charts that are similar in nature but show different time frames. the first one is a three-year chart with a weekly price graph and you can see just using very simple red and blue lines for ten day or ten week moving average and the blue line is the 30 week moving average, you can see when the ten breaks down below the 30 this is a clear sell. it works very well on a trading basis on a medium term basis. if you go to the next chart which is just the daily one which is one-year chart of this, same type of idea, red is the ten-day moving average, blue the 30 day moving average.
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this is falling below the red line below the blue line. that's a sell. so to me, it looks like newmont has dug a big hole and doesn't want to get out yet. both pointing down for them. i would wait for the ten day to break above the 30-day moving average before you start getting involved with this company. >> the sent mept and charts is negative on newmont. two for the dig a big hole comment on about a miner. >> good one. >> not accidental. >> i like you again, andy. thank you. appreciate it. check out the on-line edition of talking numbers in our partnership with yahoo! finance. >> on deck a big recall just announced for intuitive surgical. herb greenberg has had this company on his watch list for years. he will join us to take a victory lap of some sort. >> plus retail round up. hitting the mall and digging into what the holidays have in store for your portfolio. first, bill and kelly, what's coming up on "closing bell." >> oh, so much, melissa. coming up still the most
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important hour of the trading day and boy, ha it been lately this month. >> interesting action here as markets are weakening again coming up, president obama looking to up the minimum wage but an executive with the white castle burger chain says such a move would cook some of his restaurants and fry some jobs. >> bill gross is touting index funds which, of course, were pioneered by vanguard founder jack mogul years ago. now gross is going to explain to us why he is so hot on index funds coming up. >> interesting one. and this one retailer is taking it to the max with investors. we'll look at the story behind the stock especially in light of some of the holiday numbers we've been getting all that and a few surprises coming up on "closing bell." tdd#: 1-800-345-2550 trading inspires your life. tdd#: 1-800-345-2550 life inspires your trading. tdd#: 1-800-345-2550 where others see fads... tdd#: 1-800-345-2550 ...you see opportunities. tdd#: 1-800-345-2550 at schwab, we're here to help
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tough day for intuitive surgical and investors. the fda has issued a class 2 recall for parts of its surgical robot. the last part may be key. herb greenberg first raised the red flag on this company and devices in april with a documentary on cnbc. since then the stock down about 26%. let's bring in herb greenberg.
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there's couching here, right? it's a class 2 recall, a part of the da vinci thing. what is going on here. >> well, actually as i write in my blog on the street.com the bark of this recall is worse than its bite. you have to consider these class 2 recalls for medical device companies are common. the case of intuitive, five pages if you go to the fda's website of these class 2 recalls. this is -- this is the kind of thing that the company would say they're doing because they got to do it. they're always trying to make things better. there was one adverse effect out of 55,000 procedures with this type of a situation and by the way, that's one adverse effect for the robotic surgery continues. the machine didn't work the way it was supposed to. the bigger issue with intuitive something we've been pointing out has to do with electrical currents, this has nothing to do with that. we've seen the company up several quarters of sales and earnings that have been way
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below expectations. a real slowing of growth. what you are concerned at about here is any reputational risk. >> so let me get to -- sorry, melissa. let me get to what intuitive surgical said. we have to -- obviously you have to get a statement in this situation. here's what a spokesman told us, quote, the reason we did make the recall is to make the surgeons aware it is not to be ignored and important. we want our device to be rock solid for our cust mers. we don't think it presents an issue in the world of patient safety. that's their response. your response to their response? >> well, look, i'm not -- i'm anything but an apologist for the company but when you look at these recalls you have to take them for what they are. if you told me this was a class 1 recall and something significant that would have a monetary impact on the company because it was million dollar machines taken off the shelves or saying hey, something that was significantly the result of
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something that was really life threatening i would say they've got a serious problem and as you can see from the stock today, even investors are soft peddling. >> brian mentioned the documentary you did and you can catch the full documentary by the way out there, the da vinci debate, investigations inc.cnbc.com. if yis case you didn't see it the first time. >> you're hot on amc entertainment holdings, not the company of "mad men" but the movie theater chain, they want to ipo but they're also doing something a little different here. >> they're telling their customers, you want to participate in our ipo you're on your website, go to a click, a brokerage firm -- >> is that legal? >> bring the ipo to all investors. >> they're doing it. >> that's where we are. >> got to be. they're doing it? >> you know what, the fact is that's where we are in this market. we're trying to tell people come on, go to the movies, pick up some popcorn, pick up some coke
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and pick up some shares of our company. come on. that's -- if there's -- >> cheaper than the movie ticket. >> yeah. you know, you never know where it's going to go. want people to understand there's risk inherent in these deals and that's why when you look at that pitch, you get concerned, he specially, you know, in this environment. >> it's just an odd pitch, right? >> to reward their loyal customers saying you can buy into the success of the company? >> anybody remember andrew cline, lit capital brewery and wrote a book about it and started to sell shares like this. i would love to speak to him. lives in the netherlands apparently. it's an interesting way to market. >> netherlands white pages. >> orange pages. >> if you look at this brokerage firm they say we want to make ipo open to the public again and that gets into this issue of crowd funding and who should be in ipo and should it be the public or institutions. does the public understand the
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risk? all anyone has seen is these things are doing so well. ipo after ipo, big ipo market. remember, there's risk there. half of them historically are below their offering price after six months or so. >> this what is herb and i used to do for fun, we would go to public libraries an flip through foreign phone books. it was great. >> herb will stick around and see you later on. market flash from jackie deangelis. >> good afternoon, melissa. watching shares of facebook at session highs on speculation that the company could be added to the s&p 500. now fueling some of that talk, a note from ubs that states that mullexis set to be removed from the index after its merger with coke industry. facebook on this speculation up 3.6%. back to you guys. >> thank you. up next, our guru jan rogers is here to force me to eat crow. >> i would like to see that. >> yeah. herb says maybe not so fast. we'll duke it out over jc penney. wine may be quicker if you're
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looking for returns that is. >> returns, right. lb with a compact fluorescent bulb, the energy saved could light how many homes? 1 million? 2 million? 3 million? the answer is... 3 million homes. by 2030, investments in energy efficiency could help americans save $300 billion each year. take the energy quiz. energy lives here. (announcer) at scottrade, our clto make their money do more.re (ann) to help me plan my next move, i take scottrade's free, in-branch seminars... plus, their live webinars. i use daily market commentary to improve my strategy. and my local scottrade office guides my learning every step of the way. because they know i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) ranked highest in investor satisfaction with self-directed services by j.d. power and associates.
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big news on a company we follow very closely here on "street signs." some would argue too closely. jc penney reporting a jump in
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same store sale but investors don't see too giddy about it. jan rogers is gloating and herb green burg. we have a bet about jc penney same-store sales i said they would not wouldn't be positive four quarters in a row. three out of four. you wrote me last night, i had to get out of my car. i was so angry. you basically said, eat this, sullivan. you're now completely wrong. >> i brought your towel back. can you toss it in, if you would like to. >> you want me to throw this in on jcpenney? >> you got it. >> i'm happy they're doing well. i'm surprised. i could sell 100% comps if i give everything away. here's your towel. >> are they making any money? no, i'm not going so say they're making any money. i think their fourth quarter is going to be better than first quarter. year over year was positive. i think it's getting better. i think they'll be in the 30s here in the fourth quarter.
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i think the comps will be at least mid-singles, if they have a horrible december, as you pointed out. i think they'll have a solid december. i think they're getting better. i think you'll lose your bet big time. also think it will not be at zero gross margin, which was your concern. i think it will be at a better gross margin than last year i think they won't make money, but they'll be closer to making money than we've seen in the last two years. and i think it sets them up to run solid high singles or double digit comps for the next six quarters. if that's the case, then those 93 shares short are in trouble. >> jan, the one question i have here, though, and it's the point so many of us last night, we saw the press release, just howling at, do comps even matter with this company right now? can you even use them? it's so easy for them to show positive comps. what's the real metric rather than comps? >> well, i think we have to get comps and we have to get gross margin. but i do think they had to show at least double digit comps for
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people not to be disappointed. they at least got there. >> but -- >> i was hoping for 14. >> what would you use, herb, if you think comps are garage? >> i'm not saying they're garage. i'm just saying you had negative -- when last year's holiday was sandwiched between negative 26% comps and negative 31% comps, something like that, you can't help but say -- say you got 10% with aggressive promotional activity, that's why that stock is down today. because people saw it for what it was. it was a pr ploy trying to get people juiced up -- >> this stock is down because it's up 17% in the last month. this double-digit print was already in the stock. >> you know what's interesting -- herb, do you have an output monitor where you are, your box with the fake san diego backdrop? do have you a tv you can see? i made a chart -- >> no. >> i was looking at sears. mentally envision this. jan, you can see it. bring up that chart.
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sears versus jcpenney. can we do it longer? that's one week. i asked for two year. these stocks trade completely inversely to each other. right? look at that. look at the white and the yellow. they are almost perfectly inverse. if you're buyers, jan, of sears, your stock you're buying versus selling. basically these companies going to fight it out to the end? >> penney's has double dip? is that good for sears in no. the floats's gotten bigger. there's a lot of problems at sears. the real estate's not worth what people have talked about. the very -- >> jan, let me tell you the real problem at sears. i was in the sears store at utc, university town center in la jolla monday at noon. i have a picture i hook with my iphone 5s. if you take a look at this picture, and i tweeted out and said, what store am i in?
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capacity for the people that saw the craftsman label they all said sears. they figured it out. there's no one in the store. >> yeah, that's been the problem. >> maybe because you broke in. it was after hours. we don't know. >> they haven't done any sales. but i don't think their brands are worth what they thought they would be either. land's end is the only brand they have to sell. >> we have to go. brian and jan, bet, bet? going today into the end of the year? >> evenfy lose, i win because jcpenney means they're doing better. how about that for a slick answer? >> jan, good to see you. herb, always good to see you. thanks. coming up, how to possibly double your money from booze. [ male announcer ] what if a small company
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forget stocks in a minute. could investing in liquid be good for your portfolio? joining us, and i'll screw up your last name, nicholas polaki. >> a whisky investing expert and ceo of the whisky dog and whisky isle who claims that some of this whisky here, i think this one in the cool looking leather case, could double in price in just a couple of years. >> absolutely. absolutely. what we've got here, three
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whiskys, first of all. first thing i'm looking investing in whisky ail, first of all, collectability, second real ability, and this is 25-year-old, $350 a bottle. >> only? only $350 a bottle. >> bargain. >> i'll buy you ten. >> thanks. >> i think that place point a lot of people will drink them. i would say in the next kind of five, ten years this is going to be worth $2500 to $3,000. this is a 1970 extraordinary, this is my own private bottle i bro brought along. this is a $5 neu bottle. hand-blown crystal decanter. only 179 bottles globally. it's a rare whisky out of the gate. a unique kafcask. the last is mcallen, the "m" on
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the decanter. first edition of the decanter, launched this year. i brought a little to taste. thanks for those at mcallen. >> i have mc conflict. >> this will make you feel better. >> two years -- the whisky maker spent two years going through the entire warehouse, 200 casks, the oldest was distilled in 1949. this is change your life whisky. >> it is good. it's $460? >> $4500. >> you said because there's only a couple left available, and once it's bought at $179, it could double? >> i think within ten years -- i'm going to hold this bottle within ten years, i could see this fetching $30,000 to $50,000. same for first editions of
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mcallen. >> wow. great stuff. it's smoother than a "street signs" show tease. >> if you need more money, check into "mad money," jim will be talking to the founder of avian tequi tequila. i'll see you on "fast money" i'll be speaking to the ceo of lifetime fitness. >> cheers. and welcome to the "closing bell." i'm kelly evans at the new york stock exchange where we may yet have another down day with the dow off 62 points. >> looks like it. in fact, today's fun fact, you can write this down or impress your friends at tonight's cocktail party, the last time we started any money with three consecutive down days was back in september 2011. that didn't even happen in 2012 at all. >> that would have been in the middle of a pretty sharp correction as well. >> in fact, that month, september of '11,

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