Skip to main content

tv   Closing Bell  CNBC  December 24, 2013 12:00pm-2:01pm EST

12:00 pm
flash-in-the-pan, sort of add-ons to the big things happening. i think over time, carl, we'll see twitter and facebook integrated into so much of what we do. in the same way we don't talk about online marketing, we won't be talking about social media marketing. it will just be called marketing. >> thank you for coming in. >> it was great. loved being with you. going to bill and kelly now for the "closing bell." >> thank you, carl. yes, welcome to the "closing bell." i'm kelly evans here at the new york stock exchange. santa appears with us because the rally shows no signs of slowing down. >> and for some of the social media stocks, as well. >> can we talk about twitter? >> after i tell you i'm bill griffeth. i'm happy to do that. you look at facebook and twitter, and it's up another 5%, 6%. >> there it is. 68.81. >> how long ago it was at $50 or $30? i mean, it just has been an
12:01 pm
incredible run, not only for that one, but facebook has doubled in 2013 this year. that really is one of the stories of the year. >> remember, when twitter went public, there were lots of people saying -- the retail interest, that's how we should have known, the retail interest wasn't that strong. there was a lot of institutional interest, and people thought after price, hitting near 50 on the first day of trade, drifting back to the 30s. instead, it has marched steadily higher. you can feel people buying in, ramping up into the year end. >> going back to november -- early november. and just an incredible run. there it was at $38 when it was at its low, and now we're at $68. unbelievable. we'll get to more of that. meanwhile, the dow is heading for its fifth straight record close after a much better-than-expected surge in durable goods orders. a lot of the economic data have been pretty good. so i think it was a prescient decision by the fed last week. >> and some fed officials are
12:02 pm
saying how surprised they are how positively the market has responded. along with the other reports we've seen, it's hard to argue that there's nothing -- there's no real strength there. the 10-year is reflecting that. talk about other levels to watch today. it is almost sat the 3% level, just extraordinary move. that was the year's high, south of 3%. anyway, plenty coming up on the program. we have more on whether the santa claus rally will carry over into 2014 and which stocks will lead the way, and stocks aren't the only way to invest. wine has become very investable. >> and we're all wine experts. how does one become a wine expert? >> you'd think with the amount of sampling we've done -- >> yes. >> certainly, i wish i were a little more of an expert. secondly, whether stocks or wines are the best investment. and showing you how far we're doing so far today, up about 50 points for the dow. that's about the session high. remember, this is a half day. that's why we're standing here
12:03 pm
now, because this is the beginning of the last hour of the trading day. we close at 1:00 eastern time today. nasdaq's up five points, and also the high of the session, at 4,153, and the s&p is up about 5 points, as well, at 1,832. let's get to our "closing bell exchange," peter anderson, craig hodges, and we're all over the country today, craig hodges from the hodges fund in dallas, david molenar from hightower, todd , who we all hate because you're in florida. craig hodges, i mean, what an incredible run for this stock market. does it continue in 2014 now that we know that the easy money from the fed that has really fostered the rally in many ways the last four, five years, is going to start to slow down a little bit? >> yeah, you know what, the hodges fund, we think it will continue. we've been through, you know, basically five years of outflows
12:04 pm
out of domestic equities. and we're just now seeing the very early stages of money coming back into this market. i don't expect we'll see as big of moves. i think it's going to be kind of a normal market, if you will. you know, kind of the 8% to 10%, 12% type returns. but for a firm like ourselves, that's a perfect environment. that's where stock picking and actually the market doesn't take all of the stocks up, just the ones that are earning, you know, more money this year than last, and growing at a faster clip than the competitors. >> well, that's interesting you bring up the earnings growth and i guess the revenue projections generally, peter, i have to ask you, ghing back to what's happening with a company like twitter, there's lots of people we hear from every day, the retail public shaking their heads going, should i be worried about the valuation levels here, or do i need to understand the disruption that's coming from some of the new players? >> right, kelly. well, i'm one of those people that's in that category of shaking the head.
12:05 pm
just because i think twitter still hasn't really been quite proven out. but if you carry that thesis over to just plain u.s. stocks, many in just the common industries, there are plenty of stocks out there that are still reasonably valued, and by that, i mean lpe, in the range of 14, 16 times. but they're up almost 100% year-to-date, just like twitter is. and i still think they have a way to go. in the portfolio i manage, for instance, i was just taking a look at it before i came on here to see what the projected earnings growth is for next year. on average. there are about 25 stocks in there. and the projected earning growth is 20%. so i think it's got legs. i think that the fed -- everything is in alignment. it's a wonderful way -- >> peter, the projected growth is 20%, and already trading 14, 15 times. are you suggesting you think 20% earnings growth for some of the companies next year is achievable? >> oh, absolutely.
12:06 pm
and it sounds like your prior speaker said, it is a stock picker's market. you can't make these general statements about the index and say that everything in the s&p 500 is going to be moving up. when you start looking at some of the companies, for instance, you do see that there's a rationale why they can move up. >> david molnar, how does wall street look from san diego's perspective? can this rally continue in 2014? and if so, who takes us there, do you think? >> thanks, bill. glad to be here. yeah, i think the calendar is going to change, but we don't think the market is going to change. we're moving into 2014, but the reality is, the stocks will continue a steady march higher on the back of pension fund reallocation, and the fed's ongoing qe policy. yes, we tapered a week ago. we dropped 10 billion and they traded that with very accommodative dovish rate forward guidance rating, still running $900 billion annual
12:07 pm
rate, so we don't see any change really. i do think the first guest, we agree there, that the returns that we see in stocks are probably not going to be 28% like we're running right now. >> right. >> two years of double digits. so maybe something more in the historical, he said 8 to 12, we agree that's the target range, as well. but for the beginning part of the year, anyway, it's more of the same. >> todd, if you look at the best performing skters this year, it's health care and consumer discretionary, even at a time during this holiday season when we're talking about the discounting pressure, whether foot traffic has been weak. so what do you stick with for 2014? do you rotate into other areas? >> well, i think investors now need to take a hard look going into next year about their asset allocation in general. still many are underweighted to cash -- overweighted to cash and fixed income, so we like equities in general, coming out of a very strong year in the market like we had this year.
12:08 pm
historically speaking, since 1945, stocks have averaged about 10%. so we really like the equity markets for 2014. i think probably one of the best stories out there that never seems to be talked about enough is the energy markets. we talk a lot about twitter and facebook and technology, which is really the sex appeal. but the reality is the booming thing going on in this country right now is the shale gas, the fracking that -- the hydraulic fracking going on, that's leading to jobs. it's leading to a revolution -- a renaissance in manufacturing here in this country, and i think that's the big story for 2014. >> but how -- i'm curious, how do you play it? because at the same time we're looking at the gas price, and the oil price, i should say, crude oil, and at $99 still here for the wti. why is that lasting, because everyone says it will be way, way lower and it's not happening. >> a lot of supply. >> that's a good question, kelly. my feeling is we manage wealth for wealthy families and the
12:09 pm
first goal is to preserve wealth and then growth and income. from our standpoint, we want to play the energy way very safely and profitably, so we like the pipeline stocks, and mlp pipeline stocks yielding between 5.5% and 6%. with tax efficiency, so people looking for income out of their portfolio, are a little hesitant where the fixed income markets are going, i think they should take money from cash, or maybe bail out some of the fixed income into this area. >> rick santelli, as kelly pointed out, the 10-year tantalizingly close to 3%. does that become a resistance level? does something technical happen at that point? are you waiting for that? what happens when we get there? >> the round yields are always important, whether it's 3, 3.25, 3.5, so the answer is yes. even though i've been wrong thus far, to be at or above it by now, yes, conventional wisdom on this floor, some pretty smart
12:10 pm
conventional wisdom, would dictate 3 and beyond. yesterday, 2.94, and the 30s just woke up. they were really dogging it. they're up about four basis points. so we continue to see parallel shifts today, even though the big trade in the last month has been flattening. and if you look at just the last month, the 5s, the 30s has lost 40 basis points of steepening, that's huge. but the big trade this year, really foreign exchange, let's not forget they celebrate the nikkei at 16,000. i can remember in 1989, december 29th, it was just shy of 39,000, and the dollar-yen finished last year with an 87 handle, and we're trading with a 1.04 handle. so that's the big trade i think you want to continue to monitor for next year. >> that's so true, rick. not to belabor the point, but when you put up the five-year chart, to see 1.75%, or just about, it feels like we're talking 1.61.5 the last couple
12:11 pm
weeks, and we're pricing in fed rate hikes by, what, 18 months' time. is the market going to force the fed's hand here, rick? >> well, it's interesting, because bill always has a way with words. he said it was prescient if they done the midwest taper, because the market is pushing back. now, let's be fair here, kelly. it is possible that this is more unwind than proactive, but we'll have to wait and see. >> you know, rick always has the nicest way of disagreeing with me, doesn't he? the big smile on his face. gentlemen, thank you. merry christmas. enjoy your holiday. >> happy holidays. >> see you guys. thank you. >> bye-bye. >> we did this at the christmas party, come on, you're not quite wearing your boots. >> i wore flat shoes. >> these are almost flat. see. >> we're not that far apart in height there. anyway, where are we going? going higher. the dow is up 55 points.
12:12 pm
this is the last hour of trading. we'll be closing at 1:00 eastern time today. >> yes, the nasdaq today, despite twitter, is actually lagging a bit on apple giving back weakness, but can a santa claus rally carry over into 2014, and if so, which stocks on the nice list? stick around to find out. also, deep discounts are not enough, it turns out, for many retailers right now. some are actually staying open around the clock to try to attract shoppers. when we come back, we'll find out which retail stocks you maybe should be looking at for some last-minute shopping tips for your portfolio. and a record year for stocks, which results in a bonus boost on wall street. you may be surprised by who is getting the biggest payday. stick around to find out. you're watching cnbc, first in business worldwide. y's guaranted one-second trade execution, we route your order to up to 75 market centers to look for the best possible price -- maybe even better than you expected. it's all part of our goal to execute your trade in one second. i'm derrick chan of fidelity investments.
12:13 pm
our one-second trade execution is one more innovative reason serious investors are choosing fidelity. now get 200 free trades when you open an account.
12:14 pm
12:15 pm
if you're still procrastinating with the holiday shopping, what are you waiting for? we do have good news. many stores have been open around the clock, and they will not close until very late this evening. >> yeah, the question is, though, whether the extended hours really will boost sales or spread them out over a longer period of time? sarah eisen is taking a look for us. sarah, what can you tell us for us? >> reporter: in sacaucus, new
12:16 pm
jersey, the stores have been open nonstop. it sounds like a gimmick, but it's actually a new, serious strategy they're putting in to address serious challenges that they're facing, a triple whamny this season. number one, the consumer. you've been talking about and reporting the latest traffic, showing it's over 20% last week versus the week before. slow numbers like that. but also adding to their problems, you have six days less in terms of the holiday spending season this year, versus what's typical. six days less between thanksgiving and christmas. so that's a challenge. on top of all of that, you have the surge in online spending, buy whenever, whatever mentality, that's causing the retailers to stay open 24/7. i talked to a number of analy s analysts, and they aren't too optimistic that it will move the needle in terms of sales. they say it's not going to cause consumers to open up their
12:17 pm
pocketbooks more, just going to shift the sales toward different times per day. we heard from the former toys "r" us, said, look, it's a profitable strategy, even if you have 20, 30 people in the store at night, which is something, by the way, our crews saw. we were here at 3:00 a.m., and there were people, taking advantage of fewer crowds, taking advantage of perhaps better service, but the read here is that it's not going to really change the outlook when it comes to holiday sales traffic. >> sarah, you were there at 3:00 a.m. at -- i mean, that's incredible. has the traffic picked up during that period of time? i'm surprised anyone was in the store at that time. >> there were a few cars in the parking lot, 3:00 a.m. to 6:00 a.m. right now, it's full. there's a kohl's, there's a toys "r" us, a sports authority packed. so if seacaucus new jersey mall is any indication, maybe the last hours before christmas could be a sign that things will
12:18 pm
pick up. certainly, different than what we heard from the latest numbers and the anecdotes from the retailers. >> how is that for a welcome to cnbc, in a parking lot at 3:00 a.m. >> hey, it's the most important story of the day. >> there you g that's why we put you on it, sarah. it's the final day before christmas, and we get the final word on retail before christmas arrives. >> we talk with senior research analyst of piper jaffray, and harold, and welcome to both of you. neil, we've established the last few weeks this has been a watershed year for online retailers. when all is said and done, what impact will they have had on the brick and mortar this year, do you think? >> we think for those brick and mortar retailers that have the e-commerce websites, that work very well, the consumer's already there.
12:19 pm
it's up to the retailers to keep up. it's definitely going to be a photo finish holiday season, but an eholiday season bring the time it plays out. >> what are the top picks for 2014, howard, in your sector? >> for 2014. i think for 2014, you have to stick with where there's momentum. there's not a lot of momentum in power. it hasn't been a strong year. looking out to 2014, you pick guys with momentum, differentiated, so nordstrom for next year, tjx, and limited brands. >> we used to ask the question, does it matter if they have an online presence to go with the brick and mortar, but that's a foregone conclusion now, isn't it, howard? >> yeah. you have to have an online presence. and really, the bottom line is, you have to be there for the shopper when the shopper wants to shop. so if the shopper wants to go to the mall, you have to have the stores. if the shopper wants to shop from the house, you need a fast and accessible website.
12:20 pm
>> yeah, it used to be that they would cannibalize but -- >> yeah, exactly. jack was saying yesterday he did all of his shopping join line, and the response to his point, there were a lot of people who had done the exact same thing. so as that happens, as more people shop online, who are the players that win? is it in amazon? how many other dot-com websites are we bringing into the retail here? >> no doubt, the pure-play e-commerce sites will have the upper hand as it relates to the procrastination of the u.s. consumer. however, our own survey work has demonstrated over the last six months that consumers prefer to shop at sites with stores. it removes some of the consumer pain points of returns. so we say focus on those retailers that are thinking ahead on the digital side and have good exposure. we agree with howard. we like that nordstrom. but we'd also throw in a really tough chart for 2013 on urban outfitters and look at that for 2014.
12:21 pm
great business online. >> who's going to be the big loser here ? i think of a target, struggling so mightily because of the breach in their security. how much of an impact does that have, even with the 10% discount, are they sort of the big loser, or someone we're leaving out here, nealy? >> it's hard to call target, it's not a stock we cover. what we can say, it raises the bigger issue of security and data security. we say investors need to allow these retailers to spend the dollars to make sure things like that don't happen. and so, with that can mean lower earnings in 2013, but only temporary. those are good investments to make going forward. >> yeah, and the technology guys that will help them out with this one. nealy and howard, thank you very much. merry christmas. >> thank you. >> thanks. we have about 40 minutes left to go before the closing bell. strange to do it as we approach 1:00 p.m. >> i'm hungry. it's lunchtime.
12:22 pm
>> i told you to have some chocolate. >> i should have. where was i? american airlines stocks, flying high since completing its merger with u.s. airways a couple of weeks ago. when we come back, we'll hear from somebody who says the sky is the limit for this stock. >> also in the sky, santa. we're tracking him right now with the help of a top general at norad and update his travels later. eas that spark your curiosity tdd# 1-800-345-2550 can take you in many directions. tdd# 1-800-345-2550 you read this. watch that. tdd# 1-800-345-2550 you look for what's next. tdd# 1-800-345-2550 at schwab, we can help turn inspiration into action tdd# 1-800-345-2550 boost your trading iq with the help of tdd# 1-800-345-2550 our live online workshops tdd# 1-800-345-2550 like identifying market trends. tdd# 1-800-345-2550 now, earn 300 commission-free online trades. call 1-888-628-2419 or go to schwab.com/trading to learn how. tdd# 1-800-345-2550 sharpen your instincts with market insight from schwab tdd# 1-800-345-2550 experts like liz ann sonders and randy frederick. tdd# 1-800-345-2550 get support and talk through your ideas with our
12:23 pm
tdd# 1-800-345-2550 trading specialists. tdd# 1-800-345-2550 all with no trade minimum. and only $8.95 a trade. tdd# 1-800-345-2550 open an account and earn 300 commission-free online trades. call 1-888-628-2419 to learn more. so you can take charge of your trading.
12:24 pm
12:25 pm
tesla has one of its cars is five times less likely to have a fire than a traditional gas-powered car. then calant is moving lower, the current quarter outlook disappointing. and cracker barrel is moving higher, after the company's biggest shareholder said he was considering a bid to take the restaurant company private. activist investor has control of nearly 20% of cracker barrel's stock. we're going to finish off with american airlines hovering around flattish, trying to move higher in todays session. up around 6%, 8% since the completion of the merger between u.s. airways and the old amr
12:26 pm
corp., parent, of course, of american airlines. >> yes. and we'll talk about that, dom. thank you very much. can the new american airlines group keep flying higher? the airline group this year up a phenomenal -- i want to say maybe 60% as a group. >> and you're finally getting the long institutional crowd interested in an industry that's traditionally struggled. >> let's do this here. a brawl today with henry, equity analyst covering the travel industry with hudson, and abigail is founder of pete theories, a cnbc contributor and not a fan of the new american airlines. henry, make your case. >> sure. american and u.s. airways combined will be serving more than -- operating more than 6,000 flights, $9 billion in cash, more than 100 million frequent flyer members, re-fleeting the airline with more than 600 new fuel-efficient aircraft. hubs in key markets like new york, philadelphia, charlotte, dallas, ft. worth, and l.a.
12:27 pm
and a very enthusiastic workforce and happy workers make for happy passengers. solid economy. stable fuel prices. >> all right. >> i'm expecting a ho ho ho at the end of it. abigail, what about you? >> all good points by henry, but the new combined entity is facing serious headwinds that investors need to keep in mind. first, looking at merger integration risks. everybody is betting on ceo doug parker and his experience. but the one thing we know about bringing two companies together, there are always unknowns. investors need to keep this in mind. second, this company is taking on massive capital commitments to fund a plane-buying binge that is likely to really eat into net cash flow over the next ten years. plus, if market conditions do not hold up, this could really force capacity growth, and eat into the company's capacity discipline. third, when we look at sector performance, as bill mentioned,
12:28 pm
this has been one of the best performing sectors. it's usually next year's tough trade. i'm cautious to bearish on american airlines group. >> i thought that would be your first example, the fact this is up as much as it is, henry. you're working from a very high base for a lot of the stocks. you feel momentum can continue. >> yes, in the u.s., at least, seeing capacity discipline. that's why it's so hard for us as travelers to find seats at the last minute, and the airlines are being very, very aggressive in terms of managing the number of seats sold at the cheapest prices. the other thing important to bear in mind is that airlines are working successfully to monetize the product in much better ways. so they're selling us things we actually like and we're willing to pay for them. i've been -- i started my career working on the advertising for american. i've been through airline mergers.
12:29 pm
they are tough. but american has a talented group of executives from both sides, and i think that they really are poised to win here. >> abigail, i'm curious, since you typically look at the charts, whether that has caught your eye in this particular case, there's something in the technicals that sets off the alarm bells? >> great question, kelly. a duff chart. not a lot of trading history. we're looking at a flag, possibly it breaks to the upside. but i wouldn't be surprised to see it break right down to where american airline group started off a few weeks ago, or about 10% lower. so it's really a matter of watching the levels out of the gate like this, stocks tend to be volatile, so you think more over the medium term. if above 27.45, looking at a $29 stock in the near term, between 35, probably 23.50 stock, but again, medium to long term, i think you want to be cautious here. >> and just think, if the faa has its way, we'll all get to sit next to somebody on -- >> yakking away.
12:30 pm
>> -- on their cell phone in the next year. wouldn't that be fun? as you said, henry, happy customers make for a happy airline. >> thanks. >> merry christmas. >> we will get an inside look at the state of the travel industry when we speak to kayak.com, which get as lot of traffic this time of year. >> i can think of nothing worse than sitting next to a person on their cell phone for six hours. up 65. just a reminder, we are closing it up for the christmas holiday. the market's on a half-day schedule. >> and two key levels to watch going into the close today, it has to be twitter, whether it touches $70, and whether the 10 year touches 3%. we'll try to keep an eye on both of those. will it be bulls or bears out of hibernation? that's next. don't fehr get. -- forget. coming up, investing in wine. we'll hear from a wine expert -- besides us -- who believes the market will continue heating up in the new year. we have someone on the wine market to let you know what they
12:31 pm
think. we'll reveal the tweets later on the "closing bell." (vo) you are a business pro. seeker of the sublime. you can separate runway ridiculousness... from fashion that flies off the shelves. and you...rent from national. because only national lets you choose any car in the aisle... and go. you can even take a full-size or above, and still pay the
12:32 pm
mid-size price. (natalie) ooooh, i like your style. (vo) so do we, business pro. so do we. go national. go like a pro.
12:33 pm
forget the s&p.
12:34 pm
look at twitter right now. up another 8%, and while we were in commercial, you should have seen how high kelly jump whd we saw it traded at $70. >> look, it's just a fascinating story. we're looking at the volume behind us. 28 million shares, 10 times as much as some of the company's like p&g trading on the floor down here today. incredible move. >> well, earlier today, a longtime tradition on the floor of the new york stock exchange, "wait until the sun shines nellie." and we have a tenor and bass, running over here to be with us on the set. a private joke. twitter. what is going on here? i was going to say, have you ever seen anything like it? >> you're asking the wrong guy, when kelly jumped, i assume she was looking at me. i'm used to that reaction with women. it's trading, and it's amazing. i have no clue -- i don't have a twitter account. >> does it set off alarm bells?
12:35 pm
>> that's a different -- >> do you look at this chart and go, wow, what a great group of people. or do you say, this is a -- >> fair partying like 1999 again. >> they're getting in behind this. everybody feels they have to have it in their portfolio. it's one of the stocks you want to own, because it's a story people can relate to. they don't want to be left out on the google or facebook to some extent, so people are loading up on it. no one is getting out of it. you have to wonder about the valuation of the stock at these levels. >> this is an extreme example, but it's been that kind of market for the last few years which we attributed in large part to fed policy, but let's face it, equities have been the place to be if you were willing to take the risk. >> the big picture, the world economies are improving. we've gotten the concept, the glass is half empty, but now we're half full and going up. that's the big picture. the money coming out of the fixed income, again, it's part of the throw and this bowl we
12:36 pm
call t.i.n.a., if you have no money, it's been a slow trickle, actually a positive in the bigger picture. but i think the trend continues as we go into the new year. >> it's the correlation i find very interesting, the two things happening today, is a company like twitter, which we traditionally associate with being one of the momentum names, moving the way it is on the same day that the 10-year is nearly cracking 3%. in other words, people are talking about a world beyond the fed next year. so it's not as if this is happening on a day when they've come in and said, we'll stay in the market, and it's an endless qe or that -- >> it seems that finally everybody is buying into the market, which brings up the old adage down here, which is when everybody thinks things are good, we should be afraid, or when people are getting greedy -- >> but are we there yet? just the other day -- was it friday -- the gdp number came out, the revision, to 4.1%. we had a survey also come out that day where 49% of the
12:37 pm
consumers who were surveyed felt that we were still in a recession at this point. >> right. and that's the data -- >> so there's disbelief. >> right. people are not 100% buying into equities yetle. and that's why -- look, the credit markets are an important part of this thing, because as long as the majors can get in there, raise capital, then support the market with buybacks or other kinds of capital activity, we're going to continue to see this trend. so, yeah, people haven't totally bought into it yet, so there's still room to the upside. we'll let you know when it changes. >> thank you. i hope you do. >> i wonder, briefly, ben, when we talk about how many listings we've had this year, they've done reasonably well, there hasn't been a lot of m&a activity, but equity capital markets has been a bright spot for a lot of things. does it continue next year? does it start to be like an ali baba that everyone is excited about, does the next crop of ipos draw more interest? >> the next ipos, two different points of view, one for the psychology, it's important to continue the momentum into the equity markets. it's part of this big picture of
12:38 pm
the bull market continuing into next year. the other side of the factor is the world economies are getting better. these ipos coming to markets seem to be able to demonstrate a reason for investors to own stocks. far less stocks to actually own in this decade than there were a decade ago. the wilshire 5000 only has 3,600 stocks in it. >> is that the case? >> so as the ipo market develops and we'll see more out of china as they get their new -- their new information flow in place, so to speak, to be politically correct. but i think that's all an indication of the positive of what's going on on the equity side of the equation. >> we always enjoy your insig s insights. don't you have songs on itunes, seriously, you've cut albums? >> i create add cd a few years ago for my parents' scholarship foundation, a promise kept. i'm known as the tenor of wall street, as you -- >> yes. >> gordon is also an accomplished musician. >> gordon is known as a lot of things on wall street but -- >> smart guys know when nellie
12:39 pm
comes, stand next to men, because then you sound like you know what you're doing. >> thank you. >> thank you both for being with us. merry christmas. ben willis and gordon joining us today. we're heading into about the final 20 minutes of the trading session today, before we get to the holiday tomorrow. the dow is adding 55 points, around a .3%. it will be a bill, if it closes here, what, the sixth consecutive record high. >> and we're wondering whether naughty stocks can be nice for investors. s seema mody will have a look at that. ♪ afghanistan in 2009. on the u.s.s. saratoga in 1982. [ male announcer ] once it's earned, usaa auto insurance is often handed down from generation to generation because it offers a superior level of protection and because usaa's commitment to serve current and former military members and their families is without equal. begin your legacy. get an auto insurance quote. usaa.
12:40 pm
we know what it means to serve.
12:41 pm
[ bagpipes and drums playing over ] [ music transitions to rock ] make it happen with the all-new fidelity active trader pro. it's one more innovative reason serious investors are choosing fidelity. get 200 free trades when you open an account.
12:42 pm
welcome back. 'twas the night before christmas and the stocks are ready for a banner close. >> you recited it well. you sold it well. seema mody looks at whether naughty stocks can be nice -- what's a nice girl like you getting naughty stocks? >> everybody has their moments, you know. we thought we'd try to find which countries were naughty. we define them as those that missed street expectations, and
12:43 pm
discovery communications, qwest diagnostics, h&r block, monster beverage, northern trust, windstream holdings and wpx energy. does missing hurt a stock's performance? eight of the ten naughty stocks were actually up for the year. only two of the ten companies with four consecutive earnings misses are down. ch robinson and qwest. so it seems as if earnings misses weren't that concerning for wall street this year, with most of the naughty stocks posting nice gains this year. out of our list, discovery communications actually is the best performing stock, stock up 40% year to date. analysts write that the emerging channels have strong growth prospects and that international markets will be a big opportunity for the company. kelly and bill? >> all right, seema, thank you. let's get to dominic chu now. he's been looking at the biggest names in business and politics and what they really want for christmas this year. dom? >> bill, i mean, i just may be wanting the xbox one under my tree, but some of the big
12:44 pm
leaders of the world probably want something even more significant. let's start off with all i want for christmas, and vladimir putin edition, and all he wants is for the sochi winter olympics to go off without a hitch, and he wants them to have no boycotts, maybe have a few more g-7 leaders show up, remember, moscow needs good, positive press. the stock market there is down 5%. another big one is elon musk, behind tesla, solar city. he wants to sell a heck of a lot more model-s cars despite the fires. they want the positive press to come back and they want to sell a lot more of the -- possibly more than 40,000 of the cars. remember, tesla shares are still up about 350% so far this year. and finally, how about one guy that probably is going to have a little bit of a christmas break now, former fed chairman ben bernanke, or he's on his way out here, what he wants for christmas is to never have to go testify before congress ever again, and possibly he won't
12:45 pm
have to. of course, there's always a chance he gets called back. but still, after a nice, nice long tenure as the fed chairman, he probably deserves a little vacation, right, guys? bill, kelly, fed chairman ben bernanke, going to get his wish a little time away from congress. back over to you. >> yes, we can only hope -- >> they haven't confirmed her yet. >> yeah, right. [ laughter ] that happens january 6th. he has to wait -- he has to sit there and watch our money until then. >> i want to know what book he writes, because when "lords of finance" came out, he talked about that's the kind of book he would like to write, so it will be interesting to see what he pursues. >> i think he will. a great read, too. some levitation here, with the dow up 61 points, and the twitter -- >> look at that, 70 bucks. >> above $70 a share, incredible. >> remarkable. and the most wonderful time for wall street. bonus time. find out how large the payouts will be this year and who's reaping the lion's share, because you may be surprised at the answer. after the bell, we'll talk about the new movies that could
12:46 pm
give hollywood a very merry christmas, when we speak exclusively to the ceo of one of the nation's largest movie theater chains. coming up.
12:47 pm
12:48 pm
welcome back.
12:49 pm
about 12 minutes left of the trading session. we've seen some move higher in the close, with the dow up 62 points. another new all-time high for that and the s&p, if we finish positive today. the one stock we're really keeping an eye on is twitter, which has boomed again, up another 8% today, above $70 per share. let's talk about the market and the economy. craig is with us from vining sparks ibg, and our friend terry dillon, as well. let me start with twitter. we were talking with ben willis and jordan, and the stock doesn't want to quit right now. those of our generation, we know nothing about it. >> sure. and a lot of us have stepped away and didn't get involved because of the quote/unquote mystery. the valuations are so hard to get a hold of, where stocks like that, like twitter, when it first came out, there was a lot of good valuation in the market, so opportunity for money might have gone other places other than twitter, especially for the
12:50 pm
older generations. >> yeah, just a different -- we're not old. >> yeah, okay, go with that. [ laughter ] >> the economic data out today, pretty good. there are those who feel the durable goods number, the big move, was a pull forward because of tax credit of. but the new home numbers are good as well. the economy is chugging along. >> yes. there are some positive signs in the economy and there's positive headwind or tailwinds with us. consumer balance sheet is much better than it has been, spending going into 2014 for the first time in four years may not be a drag. housing looks like it's weathering these higher mortgage rates. with the 30-year at 4.68 with applications coming down like they, still concerned about that. >> because rates will continue to move higher as the fed tapers here, right. >> certainly that will be an issue. even with rates at 4.68 on a 30-year, 15-year fixed is over
12:51 pm
3.50%. i think it could put some pressure on housing and force the fed to do something else. >> terry, are you in this market? you've been one waiting for a pullback of sorts and got one until the fed meeting and then off to the races again. >> we've been fully invested. i would probably take a pause and sell some here. i think getting back to the fed and back to what's going on for next year i think the big indicator is going to be inflation. i think so far the fed has been lucky in the fact that inflation hasn't crept up and put a wrench in its plans and ability to get liquidity back out of the marketplace here. i think that's going to be the bellweather for next year and that's what's going to see -- >> you think inflation will become a concern. >> i think it's going to be -- that expectation outpace actual inflation but i also think that rates are going to be determined on the direction of inflation this year. >> does that mean you would want to buy commodities? the dollar has been going strong
12:52 pm
here? >> i think it dates back to the housing crisis and the bottom in 2007, 2008, and 2009 if you will where the fed wanted to create inflation so people did buy tangibles like houses and land and real estate so they could put a floor into the real estate market drawing people into buy tangibles. there is a certain component of the portfolio that would be allocated to those tangibles relative to inflation expectations for sure. >> do you see inflation being an issue next year? >> it's a concern because of the fed's balance sheet is. >> that's a concern for -- >> right. >> and interesting thing is when you look at qe1 and qe2 and the impact on inflation expectations, mavt based expectations, commodity prices we saw it did have an impact. with qe3 almost no impact. one of the things to ask today is, if we get into a disinflationary cycle can the fed get us out of it? i may be more worried about that side than the inflationary side when we don't see any demand for loans.
12:53 pm
we don't see on the consumer side, the business side and so certainly you have to see that before we're going to see the expansion. >> you're taking a contrary position here. the fed is not worried about inflation. >> you have falling demand and the supply and demand curve will shift lower. rates may not continue to go higher if you see that downward shift in demand. that's an interesting commentp. at the end of the day rates are determined by that supply and demand. >> ten-year close to 3%. at what level do you think the bond market starts to compete with the stock market putting a cap on stocks? >> that's great question. got a little room yet before the dividend flow if you will becomes effective, but i would say you're looking at 3.5 to 3.75. >> do you agree with that? at what point does the yield on the long end of the yield curve start to compete with the stock market? >> i think when you don't have the fed in here pumping liquidity into the market you start to see valuations returning to normal. the return on stocks is down to 6% when you look at it from a p/e basis and based on that with
12:54 pm
a ten-year at 3%, 300 basis points spread i think that's tight and already, you know, you can say on a relative valuation basis, bonds are attractive. >> good to see you both. thank you. merry christmas. appreciate it. >> merry christmas. >> we'll take a break and come back because this is the end of the trading day coming up at the top of the hour as we have the closing countdown? a moment and after the bell, stocks or wine? which do you think is the better investment for 2014. a wine expert coming up and i'm pretty sure what he's going to say knowing where he's coming from. your take on this as well. tweet us, terry will tweet us and we'll reveal your best response later on the "closing bell." you're watching cnbc first in business worldwide. ♪ i wanna spread a little love this year ♪
12:55 pm
[ male announcer ] this december, experience the gift of true artistry and some of the best offers of the year at the lexus december to remember sales event. this is the pursuit of perfection. at bny mellon, our business to is investments.event. managing them, moving them, making them work. we oversee 20% of the world's financial assets. and that gives us scale and insight no one else has.
12:56 pm
investment management combined with investment servicing. bringing the power of investments to people's lives. invested in the world. bny mellon. you'd do that for me? really? yeah, i'd like that. who are you talking to? uh, it's jake from state farm. sounds like a really good deal. jake from state farm at three in the morning. who is this? it's jake from state farm. what are you wearing, jake from state farm? [ jake ] uh... khakis. she sounds hideous. well she's a guy, so... [ male announcer ] another reason more people stay with state farm. get to a better state. ♪ ♪ ♪ ♪ [ tires screech ]
12:57 pm
chewley's finds itself in a sticky situation today after recalling its new gum. [ male announcer ] stick it to the market before you get stuck. get the most extensive charting wherever you are with the mobile trader app from td ameritrade. about three minutes left in the trading session. again, this is it. the half day because of christmas eve. here's what we've done, just a general march higher up 61 points for the dow. another record high for that and for the s&p 500 again today. but the stock we've all been following trades right over here. that would be twitter. look at this, up almost 8%. we were above 70 just moments ago, seeing a little lower here, got bob pisani here. that's incredible. the run since early november when it was at $38, now at 70 --
12:58 pm
>> it never really looked back. social media in general had a great year. the big comeback of the year, of course, was facebook and we're all seeing all these stocks doing amazingly well. what i want to point out is fat kts fact we are slowly moving toward 3% on the ten-year yield, that was a line in the sand for a lot of people. $2. $2.98% we've been creeping up. one of two things going on, we're all in the holiday spirit and up in of these kinds of rules we think matter will matter until after the new year, that's possible, and maybe then at 3% the market will react. the other possibility as you pointed earlier, better economic news, maybe the market could handle slowly increasing slowly increasing interest rates and not fall apart. that's going to be a thesis i think we're going to be debating in the new year. >> interesting to see when and it's inevident eftevident evid think, when the individual investor believes in the market. >> if you look at the numbers
12:59 pm
you see inflows into stock funds and when you look at the percentage of american households who own stock the vast majority of stock is controlled by ten to 15% of the households and that's been true tore many, many years. certainly since the 2008 -- >> well a lot of people are passive investors through their 401(k)s. >> including that. >> very small group. >> wanting to add to those positions or getting back into the market there's been tremendous skepticism. >> when they start seeing the economy improve better, when we start to get definitive news, it's on the front page, jobs market improving that's when people will start moving it. it's been the missing component. it's been hartbreaking for those of us who cover this to be emotionally out of the market. >> darlene love bringing the can closing bell for this christmas eve. >> on phil specter's christmas album. >> her hit "he's a rebel". >> she's touring again.
1:00 pm
>> playing at bb king's in january and a lot of her contemporaries are still around. >> i bet we're going to be hearing her sing momentarily. that's it for this abbreviated day on wall street. merry christmas, everybody. second hour of "closing bell" coming up with kelly evans. hello and welcome to a special edition of the "closing bell" on this christmas eve. she may help us ring it in here in a couple minutes. santa claus delivering a record close on wall street with gifts tonight. take a look at the major indexes. the dow up about 64 points. that's about a third of 1%. the nasdaq up about a tenth of a percent, s&p 500 adding five points, 1833. i believe we're talking about fresh record closes there for the dow, s&p and nasdaq off its all-time highs, still i'm just
1:01 pm
so tempted to take a little shot of this. if you can hear this happening behind me, take a look at the closing bell. ♪ lots of people around baby please come home ♪ ♪ christmas ♪ the church bells in town are ringing a song ♪ ♪ christmas ♪ what a happy sound baby please come home ♪ >> i love that. nothing better on this christmas eve day. and as we said, record highs in the markets. just wanted to have my panel with me, dan from btig, kate kelly, sharon epperson, and andrew stoltman from stoltman law offices, brian kelly with us as well. we have the kelly, core group of kellys on this christmas eve. i want to open it up to you guys, dan, i know it's hard to talk about the market when we feel like we're in the middle of a concert. >> she's fantastic.
1:02 pm
>> the movie of the year to see is "20 feet from stardom" the documentary of her life, perseverance, being a backup singer for all those years, that is something to remember going into 2014. keep it going. keep it going. >> exactly. >> investors can learn from that. >> that's right. >> so many people i see brought their children or grandchildren today, sort of in the holiday spirit getting ready to put out cookies for santa. >> that's true. >> i would also know while a lot of people don't know darlene love she's not a household today as she once may have been, this is someone ha is not in the rock and roll hall of fame that a lot of people want in the rock and roll hall of fame. this is not a nobody. >> yeah. >> people were saying the best known unrecognizable name or something to that like you know the voice even if you don't know her. santa claus coming to town. look, let's just take a moment here as this finishes up, though, to kind of quick whip around the markets at all-time highs. dan, couple thoughts here. >> listen, again it was a short day so there's not so much you can read into today's action
1:03 pm
specifically. but generally speaking if you look at the curve so to speak, of how december performance, the pick-up, the bulk of those gains secured towards the end of the month and, of course, that's the period in which we are. so the bias for now remains to the upside. >> sharon, you were saying -- people are applauding for your views here, sharon, talking about gasoline prices, we haven't talk enough about that phenomenon. >> the one thing people are applauding, many, the lower gasoline prices they've seen this year, climbing a little bit here at the end of the year, but still talking about this christmas season seeing the lowest prices we've seen since about 2010. the question is will this continue and what i'm hearing when you look at what the middle part of the country is paying well below $3 a gallon in many states an that oil production continuing and refineries at full capacity the good news is we may continue to see lower prices. >> dennis was here earlier joining carl with squawk on the street the fracking story, energy evolution story one of the biggest stories of 2013 and
1:04 pm
i think what's interesting, though, is you see the crude oil barrel prices, still at $99. >> it's still at $99 and that has a lot to do with the pipeline action we have seen this year. but we may continue to see some flat prices in the oil market. natural gas a different story. we have seen a 30% dump this year in natural gas prices. a lot has come at the end of the year with the cold snap we've seen. technically traders are telling me we were talking about it today we could see prices jump as high as 4.8 7 there's a way to play that in the equity market. we had the logo up a couple moments ago. a lot of stock people have been excited about an some of their projects will get under way in the next year or two. that may be a way to look at this. i started calling hedge fund sources to say what's the hot new trade for 2014. surely people are starting to rotate out of equities. obviously they're not but i am hearing excitement that sort of pent up about emerging markets,
1:05 pm
the feeling they're way beaten down and may be a chance to look at fundamentals and pick your spot. >> are emerging markets dead money here or is there time to look at the opportunity and say they're trading at such a discount, than some more dpoeflds markets, these are the guys that are going to rally. >> this is a trade we got wrong in the fourth quarter. >> and a lot of people. >> season alty favored emerging markets. going into next year and emerging markets in general, i think it's important to distinguish between the various markets in the emerging markets. you have obviously latin america, emerging asia, countries such as india which are experiencing different idiosyncratic issues. >> one thing you need to look at is currency support. are they going to be able to maintain the value of their currency among other things? >> are these going to be nominal rallies in the markets we're seeing or real oneses? people can get wiped out if they're not hedged for the currency. is it fair to use the fragile five, the bits, seems to be the new phrase everyone is talking about.
1:06 pm
go ahead, andrew. >> i was going to say, emerging markets are about the only area of the market right now that really hasn't raced up in this past year. i certainly don't mean to be the grinch who stole christmas but a lot of this activity has to do with window dressing on the market. i'm not reading too much into what happens today or the next couple days. i love emerging markets. one of the few areas you can get risk return. >> i mean look at mexico. you made a very good point you have to distinguish between the markets. since the november low the mexican stock market is up 10% versus the s&p 500 which is up roughly 5%. there are great pockets out there, particularly full of global investors you can do better than the s&p. >> the story of mexico goes back to the strength we're seeing in the auto market, back to lib berization of their energy supply which we were just discussing. can i jump in here, i got to ask mr. brian kelly, what is going on with twitter? $70 a share today? >> it's insane. it's just gone crazy. i mean the one thing about twitter it's similar to linkedin
1:07 pm
where users can monetize the experience. you see a the lot of people advertising, being able to get out there and sell whatever had they have to sell which is the same thing with linkedin although it has that built in pro element where you have that monthly subscription. in environments like this when you get frothy stock markets you get hot stocks and twitter seems to be the one that's gone crazy. >> talking 8%, 7% rallies in the last couple days. dan, do you get the sense this is people window dressing for the end of the year to own it but also to jump in on a trade that might help them catch up if they've been underperforming? >> i'm always hesitant of the window dressing argument. i'm unsure how we evidence that, but i think generally speaking in the social media space to be clear my firm has buys on a number of companies in the space, but pretty clearly there's been a cute rally here into the end of the year. at the end of the day the fundamentals will drive these stocks and for a lot of these names, the fundamentals suggest that at least in our estimation,
1:08 pm
prices should still be even higher. >> for the -- >> sharon go ahead. >> i'm interested to know and a lot of people want to know, if i don't own it now do i need to own it in 2014 or will i have missed the run if? the fundamentals of twitter. you know the company isn't making much in the way of money. its growth is slowing down some of the foreign markets. i don't understand what twitter pitch is but look, the stock price disagrees. it's racing up. >> then dan, that's what i was going to ask. the skeptics out there like andrew, the retail public that looks at twitter and says is this another fad, how do they make money, is this sustainable what's the answer to that? >> it also depends on who you are as an investor and risk tolerance. this doesn't make for good tv -- >> but is there -- are they earning money, generating revenue and a way you can use those projectionses get to a reasonable argument for why it should be trading at $70 a share. >> the question is not whether or not they are earning or how much they are earning. the question for a lot of stocks, if not all stocks what are they going to do in the future. for a lot of names the
1:09 pm
expectation is, of course, if they're not earning today they will earn tomorrow. whether that is true or not. if you're an investor looking at a twitter or facebook or linkedin or groupon or whatever and wonder is this the right name for me probably not. >> isn't there a visceral reaction when this is social media, using it. i go on linkedin every day, twitter as you do you, multiple times a day. a certain -- is it the peter lynch principle, buy what you know. >> brian, what do you think? the buy what you know as kate suggesting the world is shifting and investors should pay attention or dan saying, more just about the expectations that someone else will bid this name up in the future? >> i think we're approaching that area. similar to 1999 when it was all about how many eyeballs you had on web pages and then the stock went up 10% from there. it's a very similar type of thing. whether or not twitter makes money in the future, yeah, there will be another fool out there for you to sell it to. just figuring out today that twitter is actually a good stock, i don't know if on
1:10 pm
thursday morning i would be buying it. wait for a pullback, wait for everybody to say twitter is done, there's a new product out there. >> that sounds like the argument for the s&p 500. >> well, that's -- >> brian i want to say with respect to the '99 comparison, important to remember for a lot of companies like facebook, linkedin, twitter, they have either revenues or earnings or the immediate expectation of revenues and earnings. in '99 you had a number of companies that had no expectations of earnings. >> i don't know -- >> no doubt -- but the point is. >> it seems to me earnings should drive stock prices and companies that don't have earnings should be troubling to a lot of investors. that hasn't stopped people from getting into it. >> andrew, are you on twitter? >> i am on twitter. >> do you tweet often? >> all the time. >> have you ever clicked on a sponsored tweet? >> not once. that's why i can't figure out their business model. >> me either. >> we'll see if they can win us over. guys, thanks very much. brian, appreciate it. we know you have to run. the rest of the panel stays with
1:11 pm
me and thanks to our viewers for bearing with us as we are dealing with christmas carols down here as well. kind of a nice change for tuesday. santa claus is coming to town later in the show we'll go live to the north american air space defense command for an update on his travels, norad. if your travel does not involve a sleigh and journey is more conventional the ceo of kayak is next. we'll find out how christmas travel is shaping up and get the latest with the on-line battle with expedia. keep it here on cnbc, first in business worldwide. (vo) y ♪ for boys and girls again you can separate runway ridiculousness... from fashion that flies off the shelves. and you...rent from national. because only national lets you choose any car in the aisle... and go. you can even take a full-size or above, and still pay the mid-size price. (natalie) ooooh, i like your style. (vo) so do we, business pro. so do we.
1:12 pm
go national. go like a pro.
1:13 pm
welcome back. aaa projecting more than 90 million americans are traveling
1:14 pm
at least 50 miles from home this holiday season. how are they getting there, where are they staying an what companies are reaping the benefits. a closer look at the travel industry in an exclusive with steve the co-founder and ceo of kayak.com, been in the on-line travel industry for over a decade and original founder of orbitz.com. great to have you with us. >> great to be here. >> one of the things that jumped out right away was one of the top christmas destinations for the american public, is it true it's washington, d.c.? >> it is. it's interesting, this time of year as americans think about going to the beach, and, in fact, nine of our top ten destinations are beach related, florida, the caribbean, mexico, bit d.c. is in the top ten. so i think that's -- travelers are being lured by cheaper airfares and hotel rooms. >> what makes it less expensive? i would have thought if anything prices in washington, one of the stronger parts of the country, are going up? >> i think it's the cold weather. it's a little bit off season for people to go there.
1:15 pm
interestingly enough we also have great deals if you're willing to travel still and haven't made plans in cleveland, seattle and minneapolis. >> i was going to say at this point when we talk about last-minute christmas shopping but that would be last-minute christmas travel. i'm curious what kind of engagement do you see with kayak.com? is it your busiest or where does it rank in terms of the major holidays for travel? >> it's not our busiest. for most travel sites january is the busiest month because once you get done with your vacations and you get back to the office the first thing you want to think about is your next vacation. you do your spring break planning. it's pretty busy in terms of actual traveling. so if you're an on-line travel agency or an airline, or hotel, you will a he see a lot of people coming to travel and stay but not booking their trips. >> i love the point about january and wonder how far we are from a point -- we know the way people are gifting things to people are changing.
1:16 pm
people want to start giving each other travel and experiences is that something that kayak.com becomes an intermediary with and benefits from and contributes to that january effect? >> you know, it's something we've thought about. we haven't moved into payment yet. but it's one of the things that we spend some time thinking about. overall what we try to do at kayak is to provide the best travel options to consumers who are looking for place to go. and we do that very, very well. sending a gift of travel to someone else we don't do yet but it's something worth thinking about. >> do you think that's going to be an emerging theme for 2014 and if not what are the themes and how important is it going to be for kayak.com to be, you know, one of the destinations, let's say there are only a coup couple, maybe amazon on the good side and delivery side and maybe kayak on the travel side, how do you maintain or get to very top of where consumers are looking? >> i think the first trend that we're very on top of is mobile devices and the shift in
1:17 pm
behavior from looking for flights and hotels on a pc or desk top and actually doing it on the fly on their mobile device. so our kayak app has been downloaded over 40 million times and it's great for looking for flights and hotels and rental cars. it's not so great for booking. so i think there's a lot of work we need to do to enable people to buy their trip true the mobile device in an easy, seamless fashion. >> what does that imply some acquisitions? what kind of technical or digital buildout is required to get up to speed? >> i don't think it's about acquisition. it's more about product and usability and getting people comfortable entering their credit card information into an app environment. and it's something that we have been spending a lot of time looking at and working and testing and in 2014 we're going to crack this one. >> and i'm just curious what the biggest change you've seen is in the travel industry during your experience and, you know, where you think it's all heading next from here? >> when i first got in the
1:18 pm
business 15 years ago airline tickets were paper based and people showed boarding passes to get on to an airplane. increasingly people are just doing it as electronic product. there is no paper to print out, will is no physical ticket. increasingly when you go to the airport you hold up a bar phone on your cell phone and get on the airplane. in 2014 that's going to continue. the next wave is in the hotel side. >> when you walk into a hotel lobby and you got the reservation on your phone the hotel just enable you to seamlessly check in without stopping by the front desk. >> i don't think anyone enjoys that wait and if they've lost the reservation it becomes a has. p do you support this move to allow people to effectively pay for express boarding at -- in airports and do you think that's coming to other industries? >> we do. what we find at kayak since we search the other travel sites we want to have a customized booking path for each.
1:19 pm
american airlines, for example, has a different array of services that they try to sell you than delta air lines. so on kayak we allow you to have a different bucket or purchase path for each of those different travel options. >> all right. >> i think that's important. >> yeah. i think again, speaks to the shifting way that people are using and experiencing travel. thank you for being here on a christmas eve as we watch owner priceline.com shares keep climbing. have a good one. >> you too. thank you. >> coming up -- >> and scrooge's name was good on the london exchange for anything he chose to put his hand to. mr. scrooge. >> well, despite andrew, the scrooge is not around the exchanges this year. set to boost wall street bonuses. our package will weigh in on whether this is a good thing or humbug.
1:20 pm
1:21 pm
1:22 pm
welcome back. 2013 turned out to be a big year for markets and the recent rallies have saved bonuses for many on wall street. tough capital rules and restrictions banks can do have affected bond traders but the journal reporting many big banks grappling with how much to pay out to traders are deal makers and others. will the only green many see be a christmas tree? turn to the panel and get thoughts. andrew starting with you, what do you glean here?
1:23 pm
we've talked about the weakness in mergers and acquisitions but who will get the bonuses this year? >> it will probably be the ipo guys and traders on the equity tied side. i have a problem with the compensation treasure. when times are good like they were this past year or this year i should say, wall street executives, wall street employees, demand outsized massive large bonuses but when times are bad like 2008, they come to the taxpayer, hat in hand, and say gee, we need $800 billion bailout. you know, when you're gambling with other people's money whens times are good you want your big share but times are bad, you say taxpayer bail us out. >> are you surprised the model hasn't changed more? >> i think it's important as an incentive to keep people performing well. i think that would be the bank's argument, although they have in recent years shifted much of the compensation from cash into stocks so people really are kind of -- have to be committed to working at their companies for three and four years because they get so many restricted stocks or options on their company's stock that vest over a period of time and keep
1:24 pm
replenishing and if they leave unless someone buys them out they have to leave a lot of money on the table. having said that i spoke to a couple of people within the last few weeks at different banks saying what do bonuses look like and therefore i'm dubious about this "wall street journal" because they're saying bonuses are going to be modestly up this year, but in terms of the comparison between a p and l, the profit and loss on a given desk and bonus percentage there's going to be a gap. you're not going to see a 20% bonus of your p and l even up 20%. it's going to be more modest than that. >> where i am talking to commodity traders many are laying the worst year they've ever had. i can't imagine they're going to get any bonus. i know who's crying for them. when you compare to some what some equity traders may be getting you're not seeing the same in the bond or commodity traders. it's been a rough year. >> i think equities are better off. you've seen the closure of a number of commodity hedge funds
1:25 pm
it has been tough there. equities will be relatively betterp. but in general -- >> do we ask dan how big your bonus is in? >> that's a great question. the only one on the panel eligible for these bonuses two quick things. the first is andrew, with all due respect, i think it's disgusting that you would say boo hoo to an entire group that come to work and having a tough year likely not to be compensated in the manner they have in the past. i understand that you think they're -- >> they're doing better than 95% of the people out there. they have no reason to complain. they're the problem. >> that bonus for a lot of people is all they get and if they get -- >> almost meltdown the worldwide economy, when you do what they did in 2008. >> who traded commodities on the floor did anything in 2008. >> oh, sure -- >> let me add you talk about the banks 90% of the banks didn't want the money. they took the money and the restrictions were imposed after. that's not fair.
1:26 pm
>> if you're at jpmorgan employees and your firm has paid out tens of billions because they defrauded so many consumers and customers over the years, you forfeit the right to complain about not getting a bonus. guess what, you can't do it anymore because your firm is a major reason why we're still in this -- >> all of jpmorgan is taptsed because i have news for you, andrew, a couple shady people in the lawyer industry as well, does that mean your compensation shuz be down? >> no. but if there's shady people in my law firm i'm not entitled to a bonus. if i'm employing guys taking on ethical behavior i don't get a bonus. if you're a jpmorgan employer you forfeited the right to complain at this point. >> the fact that these guys are having this spirited debate is a reason why the structure has changed, why we're seeing more company stock or options compensation why we're seeing less cash, why the numbers are going to be down overall. i think all of this is part of what's taken into account -- >> and there's an interesting development a lot of this
1:27 pm
happening in the uk and across europe but the claw backs of bonuses and comp generally are becoming a common phenomenon, talking about periods of it enyears. andrew, would more aggressive claw backs -- >> love the claw back. >> take care of wrong doing as opposed to saying to any member or anyone working at a bank that's been bailed out by the government, for example, that they are no longer eligible for it typical compensation? >> that's a real good point. the claw back is a crucial piece that can be used to get back money that should go back to the company and i'm a big fan of it. i've heard a lot spoken about claw backs but i haven't seen a lot of money being clawed back. so yeah, if we can -- if we can identify the employees absolutely, claw that money back. >> to dan's point to some extent you can't claw back a house. how -- you can -- mine to what extent are you going after money -- >> here's the thing that's very interesting about what both of you are saying and you have to de keep in mind people used to trading on margin on the edge
1:28 pm
and that means what i'm finding as a personal finance correspondent as well, they're living on the edge. these bonuses are very important to them and when they're having a bad year if they haven't kind of recalculated what their personal lives need to be just as they recalculated what they're going to be potentially making in the market they're in trouble. >> i mean you have to, it. >> don't cry for them but it's a serious situation. a different level that many people in this country are experiencing but their experience is the same thing. granted far different scale but it's the same kind of issue. i'm hearing it time and again they can't afford their homes either. it's like -- >> be responsible with your money. living above your edge that doesn't mean i don't have to give this money back if we do something wrong. i'm a big fan of the restricted stock. make it a five, ten year period and if you screw up or your department screws up take that money back. if you can't live within your means that's on you. >> i don't know if i would compare it to middle america because the average is making $50,000 and the average person you're talking about makes far more. >> what i'm saying is not having the bonus at least where i'm
1:29 pm
covering in the commodities market where many of those people are happy if they can make near what they made last year, then that -- they are suffering, some of them in their own way, they are suffering. >> let me make a quick analogy to bring this to something we can relate to and -- in the christmas vacation when clark griswold got the jelly of the month club for his christmas bonus he still lived ins a nice house, but we were sympathetic he got the jelly of the month club. i don't think it's fair to yell at the commodity traders for getting the jelly of the month club. >> live within your means. >> the movie wall street is talking about speaking of how things look down here on wall street, it's out christmas day, the "the wolf of wall street" hits theaters tomorrow. expected to rack up big ticket sales. the properties will be keeping an eye on the box office and ceo david brain will explain why. keep it here. in today's markets, a lot can happen in a second. with fidelity's guaranteed one-second trade execution,
1:30 pm
we route your order to up to 75 market centers to look for the best possible price -- maybe even better than you expected. it's all part of our goal to execute your trade in one second. i'm derrick chan of fidelity investments. our one-second trade execution is one more innovative reason serious investors are choosing fidelity. now get 200 free trades when you open an account. avo: thesales event "sis back. drive which means it's never been easier to get a new passat, awarded j.d. power's most appealing midsize car, two years in a row. and right now you can drive one home for practically just your signature. get zero due at signing, zero down, zero deposit, and zero first month's payment on any new 2014 volkswagen. hurry, this offer ends january 2nd. for details, visit vwdealer.com today
1:31 pm
bny mellon combines investment management & investment giving us unique insights which help us attract the industry's brightest minds who create powerful strategies for a country's investments which are used to build new schools to build more bright minds. invested in the world. bny mellon.
1:32 pm
welcome back. moviegoers will get nice presents on christmas day with a number of films in theaters, they include the "wolf of wall street" "grudge match" secret life of walter mitty. our next guest is interested in those films because he's in a
1:33 pm
unique space, runs the largest related entertainment [ inaudible ] joining us from kansas city is property and ceo and president david gray. thanks for being here. >> good to be with you. >> i'm curious to what extent you think the consumer is still spending at theaters is going to go to these movies tomorrow and what that means for your company? >> they're going to go, we hope and expect, spending very well. this year has been a great year across the entertainment recation space. skl our portfolio. a great year at the box office. box office started into the summer down double digits, 12, 14%, going to finish maybe up 2 to 4%. it's a strong finish. it's been a great holiday season. and we've got some strong finish candidates for the last part of year and christmas being on wednesday will drive above normal box office for the last week of the year which is very important. >> and you guys have a couple of different businesses and interestingly enough you own charter schools or operate charter schools, water parks. how big is the movie
1:34 pm
entertainment piece and why do you think this makes sense for investors to be exposed and investing in this space in 2014 given what you were talking about it's a volatile business? >> well it's not necessarily volatile, to correct that. it's up or down 2 to 4% a year, something like that. but it never really has a lot of volatility. that's an impression people get because of single films or studio volatility. but across the board it's not. in fact, this is a record year but it will be the ninth record year since the millennium. this thing keeps chugging ahead and it's just a wonderful -- it's the thing that continues to surprise everybody in the skeptics who continue to right the obituary for the movie theater but it's doing very well and continues to do well. across our portfolio, we don't operate anything, but we think the specialty asset area like movie theaters, like ski hills, like charter schools, is a very important, underserved and high yield investment area. we've done very well with it. with a 14% compound rate of
1:35 pm
return over the last 15 years. >> and just to what you were saying about the people warning about the movie industry in particular, these include high-profile people like george lucas and steven spielberg saying the investment in the projects is potentially going to collapse on itself if at the end of the day people just don't show up. do you see things in the pipeline for 2014 that suggest there will be new movies, exciting movies to get people to turn out and generate another year of steady growth? >> it is. there will be ten polls and ten polls are very important. the kind of films, sequels, and they comprise probably 10 of the top 15 films of the year but there will be new titles like a "gravity" or other things like that. maybe like a "frozen" that will be also important in next year. there's going to be, you know, pe body and sherman, be a variety, also a lot of temples with additional "hobbit" movie and more marvel movies.
1:36 pm
it's important on both sides of the equation but the variety is there and the capture rate actually is expanding into the age group ofs us more so than the 14 to 24-year-olds who always turn out. >> the average box office week is $200 million with 25 million people and a holiday week you can see that jump to 1.5 or twice as much. what's your projection for what this week does in terms of revenue? >>s this week is going to be twice that, more like the $400 million and it will be 45 million people or so at the theater. it will be a great week because you'll catch -- you have basically a three-weekend week with christmas in the middle of the week. >> wow. all right. you're going to see one of them, i hope? >> absolutely. i'm going to -- you know, i deal in the capital market got to see "the wolf". >> there you go. "the wolf of wall street" thank you for joining us. have a great christmas. >> my lesh supleasure, merry
1:37 pm
christmas. >> marisa mayer the tost of silicon valley. her impact on 2013 and what's in store for her and the company next year. what investment makes you feel better, wine or equities. we'll share your thoughts about where to put your money later in the "closing bell." stay with us. we'll be right back. this decemb, experience the gift of exacting precision and some of the best offers of the year at the lexus december to remember sales event. this is the pursuit of perfection. announcer: where can an investor
1:38 pm
be a name and not a number? scottrade. ron: i'm never alone with scottrade. i can always call or stop by my local office. they're nearby and ready to help. so when i have questions, i can talk to someone who knows exactly how i trade. because i don't trade like everybody. i trade like me. that's why i'm with scottrade. announcer: ranked highest in investor satisfaction with self-directed services by j.d. power and associates.
1:39 pm
♪ ♪ [ male announcer ] everyone deserves the gift of all day pain relief. this season, discover aleve. all day pain relief with just two pills. [ male announcer ] this december, experience the gift of true artistry and some of the best offers of the year at the lexus december to remember sales event. this is the pursuit of perfection. welcome back. it's that review and outlook time of the year and yesterday in our look at some of the most important people of 2013 we
1:40 pm
viewed the year of carl icahn. today we move to marisa mayer. >> writing the first act of a turnaround story you could hardly do better than marissa mayer has in 2013. yahoo! shares closed above 40 a share earlier this month. to put that in perspective, aside from two months around eight years ago, the stock hasn't seen those levels since the year 2000. why the rally? by myers admission previous management invested in chinese e-commerce giant alibaba and yahoo! japan. but there's more to it than that. in 2013 marisa meyer established herself as a hands on product executive an the most marketing savvy ceo in silicon valley. all but forcing employees and investors to believe in yahoo! again. >> vince lombardi was a phenomenal coach. one of the sayings, he was like look my priorities are, you know, god, family, and the green
1:41 pm
bay packers in that order and i joke mine are god, family, and yahoo! except i'm not that religious so it's family and yahoo!. >> product wise she managed to build and buy some interesting properties. in may paid just over a billion dollars for tumbler, a sought-after social media darling. earlier she bought sumly for $13 billion more notable for its 17-year-old founder than technology. yahoo!'s results where it counts in the company's revenue, may mayer's not moving the needle yet. the core business display ads is stagnant at best. mayer's preaching patience, needs time to launch new products which will draw bigger audiences which will lead to higher sales. and investors seem to be listening. mayer's putting a fresh face on what lots of people had begun to see as a storagy company, her face. the vogue spread and she began hosting earnings calls as live video.
1:42 pm
something a less telegenic ceo might avoid. in 2014 she'll probably have to deliver on those top line results. and she'll have to avoid product stumbles like last year's fantasy sports outage and this month's yahoo! mail fiasco. since yahoo! needs every loyal user it can get. jon fortt, cnbc business news. >> what are a year it has been for marisa mayer. want to get thoughts to jon's last point what's happening with yahoo! mail is potentially a big problem for them. we still get tweets about it, people write into the show complaining how poor the user experience is. they lost some old e-mails from the past and this is, kate, part of her strategy to focus on these core products an deliver on them. they cannot falter now. >> that's right. jon fortt had it right when she's someone to watch because she's been set up to such a high pedestal the stock performance among other things this could be the year we see more stumbles.
1:43 pm
a lot of heat on her. good story in "vanity fair" saying one of marisa mayer's skills is managing her image and neutralizing critics. >> as opposed to managing people. >> exactly. >> and some people believe she has an imperial style. she had a lot of detractors at google. >> sharon, what about the people who talk about how she's telegenic and these photo spreads. in retrospect will that have been a mistake or build the aura that has the stock -- >> it's part of the aura around here. it's a rather sexist comment to make and they probably wouldn't make that with a male person who, of course, is the ceo of a company like this. i think what a lot of folks will be watching in the year ahead is their user experience. we're talking about a company that has had a significant increase in their stock price but the experience what is people are going to bank on to see if they want to continue to be in this stock and that is going to be key going into 2014 of whether or not how she manages these stumbling blocks once people get past these kind
1:44 pm
of the aura around her, what is the experience as a user some some of them may not realize it's her company. they want to know how they're experiencing yahoo! >> does anybody have a yahoo! account some. >> i do. >> i do. >> have you had problems with it over the last couple weeks? >> speaking for myself i use it for junk mail at this point. >> then why -- >> i don't and i need to clear out my junk mail. but i have not had a bad experience over the last couple weeks. >> sharon f i could make a rejoineder to your sexist comment i think women are held to a higher standard on these then men are but one interesting might be jamen diamond on sheer personality and the jpmorgan brand -- >> his christmas card. >> there was a lot of trouble under the hood as it were it would seem and the company is facing a number of regulatory issues at a time when it's seeing terrific business results and people are wondering about its future. >> loves jamie dimon. >> you know, kind of reminds me
1:45 pm
of the wendy's commercial, where's the beef. we know the press is in love with her, shareholders are in love with her. look at the results of her company and peel the onion one layer it isn't all that impressive. reference earlier that the alibaba has taken off in china with yahoo!'s 24% interest. yahoo! japan off the charts. she hasn't about able to deliver what she needs to deliver. nothing sexist about criticizing her. it's the opposite. >> about like those elements of the criticism. damage, finally we have to go, but the -- is it all about alibaba. >> when you look at the stock's performance. i don't follow it, but clearly the improvement in alibaba has been a primary driver what's going on at yahoo! but from a general sense, i think this gets back to what we were talking about earlier with social media. time has been bought for there to be a turnaround and at some point investors will have to see results. >> short it. >> short it. i love it. >> talk about a final word.
1:46 pm
thanks, guys. coming up, 'twas the night before christmas, it's night in other parts of the world ap santa has begun his journey. we'll head live to the north american aerospace defense command for a santa update, norad, grab your kids, we'll be back with the live tracker after this break. ♪ laughing all the way [ male announcer ] at optionsxpress, our clients really appreciate our powerful, easy-to-use platform. no, thank you. we know you're always looking for the best fill price. and walk limit automatically tries to find it for you.
1:47 pm
just set your start and end price. and let it do its thing. wow, more fan mail. my uncle wanted to say thanks for idea hub. he loves how he can click on it and get specific actionable trade ideas with their probabilities throughout the day. [ male announcer ] open an account and get a $150 amazon.com gift card. call 1-888-330-3136 now. optionsxpress by charles schwab. call 1-888-330-3136 now. (voseeker of the sublime.ro. you can separate runway ridiculousness... from fashion that flies off the shelves. and you...rent from national. because only national lets you choose any car in the aisle... and go. you can even take a full-size or above, and still pay the mid-size price. (natalie) ooooh, i like your style. (vo) so do we, business pro. so do we. go national. go like a pro.
1:48 pm
1:49 pm
welcome back. no slow down in traffic to cnbc.com today. take a deep dive with alan to see what's on the hot list. hi. >> hi, kelly. today we're going with holiday shop lifting. >> oh. >> it's a deep dive by our friends over at nbc. they took a look at what happens with shoplifting around the holidays. november, december, it ticks up about 9%. looked at some of the reasons, you might think it would be logistics, opportunity, people, more of an emotional thing. people are sort of while they're gifting everybody else, they'll gift themselves too. our readers are eating it up. clicking at about 36 readers a minute. now number two on our hot list today, coal and crabs. the anat my of a north korean takeover. following this story for some
1:50 pm
time. our readers are interested in it. taking a look at the reasons behind kim jong-un killing his uncle over in north korea. apparently the new york toims found out the uncle controlled the crab and coal industry over there keeping all the revenue for himself, not really sharing all that much so they have details about kim jong-un doing the uncle in. it's a little morbid here and there but readers seem to like that. >> it's an important story as well. >> affects geopoll it ticks to a great degree. number three, the wonderful interview, rick santelli did today with ira harris, there they were, talking about volatility in the yield curve and that and all of a sudden mr. harris starts making great predictions, one tesla would get sold next year, probably to gm. we wrote up the interview with some of his crazy predictions put it up and our readers are dive pg in. >> i like to read about the [ inaudible ]. thanks. merry christmas eve. have a good one.
1:51 pm
>> santa claus has come to wall street, now he's heading to main street and to your street. up next the top general at norad tracking santa's movement and where he's heading right this moment. which is a better investment stocks or wine. your tweets have been pouring in and your best responses when we return. [ male announcer ] this december, experience the gift of unsurpassed craftsmanship and some of the best offers of the year at the lexus december to remember sales event. this is the pursuit of perfection.
1:52 pm
1:53 pm
at the lexus december to remember sales event. (announcer) at scottrade, our cexactly how they want.t with scottrade's online banking, i get one view of my bank and brokerage accounts with one login... to easily move my money when i need to. plus, when i call my local scottrade office, i can talk to someone who knows how i trade. because i don't trade like everybody. i trade like me. i'm with scottrade. (announcer) scottrade-proud to be ranked "best overall client experience." [ male announcer ] this december, experience the gift of true artistry and some of the best offers of the year at the lexus december to remember sales event. this is the pursuit of perfection.
1:54 pm
you want to get the cookies put by the fire place, glass of milk, because santa claus is coming to town and we're tracking his progress on the government's aerospace defense command website known as norad. major general charles lucky joins us live from peterson air force base in colorado. major general, great to have you with us. living up to your sur name, nice to have this assignment today. where is santa right now some. >> well, right now, he is about 46 seconds out from coming in over the island off of coast of africa. another 30 seconds he will be over marishus. >> what are you tracking? >> i mean is this -- >> tracking santa. >> certain period of time like as it moves -- as the world turns or is this -- are you just tracking santa? >> we track santa.
1:55 pm
we have infrared satellites in space that are able to pick up his heat signature as he moves through the sky, but we also have radar, airborne radars, radar on ship and land based to core late that information. gives us a good accurate fix as to where santa is. from time to time we escort him. >> yeah. where is he headed next then? >> well, after marishus looks like he's headed to another island off the coast of africa. >> okay. >> he'll be probably over the african continent the next couple hours working his way ever west. >> yeah. how fast does he move? >> well, you know, it's a great question. the specification to his ability to travel are somewhat classified but i have it on good authority he can approach the speed of starlight which last time i checked is quick. got to slow down to get down chimneys and indoors and that sort of stuff.
1:56 pm
>> oh, yeah. >> moves at a high rate of speed. >> last most importantly, major general, when does he arrive in new rochelle to sharon epperson's home? >> okay. so it's going to be somewhere between -- don't hold me to the exact second, he may get slowed down with icing or something like that, but somewhere between 8:45 and 9:15 p.m. this evening. >> oh. >> and so folks need to get, they need to settle down and get in bed. >> major general charles lucky, thank you so much for your time this afternoon. have a great one. appreciate it. >> you too. take care. >> sharon, i hope you're ready. >> santa is coming. early bed time. that's what i love about christmas eve. get the cookies ready. >> we wonder if santa will trade milk and cookies for something more grown up? bottle of bordeaux? some of you on the twitter verse think wine is better than stocks. frank saying buy wine, a good wine never goes bad.
1:57 pm
a good stock can turn to sour grapes. >> casey stocks and then wine about their performance. one tweeter has a question for our next guest, greg was asking, got a vintage 1972 bottle of strawberry hill. what's it worth? no one better than jon, ceo of one of america's oldest nine shops at post nine. welcome. >> thank you very much. >> do you know what bottle he was referring to? >> not exactly but unfortunately i don't think it has much value in the market. it might not be good. >> what does have value. >> the top brands in the world, particularly the top three were domain country, chateau la feet, and chateau [ inaudible ]. >> in terms of demand or price point? >> of value. demand and value and dollars achieved. those three brands represent about 25% of the market. >> wow. >> i guess we know what to get for holiday gift if you have a couple minutes left. just curious, wine as an inve
1:58 pm
investment do you recommend it? >> absolutely. it's been proven to be one of the great investments over the last 25 years. i mean there are wines that have gone up in value 40% over the last year alone and -- >> sounds like the market. >> sounds like the market. some wine stocks have gone up considerably as well. why invest in wine and not the equities or do both? how do you determine? >> i think, you know, a little portfolio diverse if ication appeals to at love investors. don't want to have all their grapes in one basket. wine is a stable asset. it's very good for long-term growth as well. there's always pressure on demand because people drink it. and so supply is going down and people are going to want the same amount of wines but people are drinking it so there's less and less. >> i have a quick question, when i was born back in, you know, 10, 15 years ago -- >> 1990. >> my parents were given a bottle of red wine. >> i want to say it was a chateau la feet and we let it age too long. opened it on my college graduation and it was past its
1:59 pm
peak. say you have a friend having a baby, spend $100 for a wine, any suggestion. >> bordeaux is usually a good choice. i'm surprised to hear that. might have had storage issues. >> in my parents' basement, are you kidding? >> what could go wrong? >> i have an idea. >> bordeaux should be, you know, a great investment. any top producer for -- making wine is going to last 20 years. >> andrew, did you want to jump? in? >> i think maybe wall street could begin to like this idea. maybe they can secure tize these things, do no do diligence and jam down the throats of unsuspecting investors. sounds like a christmas gift for -- >> not all unsuspecting. some are suspecting. >> slate finance works with mortgages, works in hollywood. >> sure. >> it's a great prospect. >> why not wines. >> we have to go. is there a point here about buying a tangible good or is this all about bidding it up? >> long story short for a lot of
2:00 pm
investors who have extra capital in which to invest, hard assets, commodities, wine are -- is obviously an area of diversification. >> thank you for being here on your christmas eve for spending it with us. want to thank, of course, jon as want to thank, of course, jon as well for joining usus. (watch ticking) >> you know, in today's regulatory environment, it's virtually impossible to--to violate rules. and this is something that the public really doesn't understand, but you--it's impossible for you to go unde-- for a violation to go undetected... >> kroft: yes, that's bernie madoff saying it was impossible to do exactly what he did. but one man did try to tell the government what madoff was up to. how long did it take you to figure out that there was something wrong? >> it took me five minutes to know that it was a fraud. it took me another almost four hours of mathematical modeling to prove that it was a fraud. (watch ticking)

121 Views

info Stream Only

Uploaded by TV Archive on