tv On the Money NBC November 17, 2014 12:30am-1:01am PST
hi, everyone. welcome to "on the money." stocks hit new highs. oil plunges to new lows, but what to do if you're looking for income? ford's big bet on its best-selling vehicle. our conversation with ceo mark fields. and it is the avon lady reima reimagined. the talk about money you need to have with ageing relatives, whether they want to or not. here's a look at what's making news. if you did some serious shopping
last month, you were not alone. retail sales rose by 0.3 of a percent. that number was slightly better than expected and due in part to falling gas prices. those gas prices fell because crude oil tumbled to a fresh four-year low. this is part of increased production in u.s. and it is also in part to decreasing global demand. the dow set another new all-time high on thursday. this was the 25th this year. the nasdaq closed at its highest point in more than 14 years. stocks were mixed on friday. walmart, macy'smacy's, jcpenney
better than expected. that adds to buffet's portfolio me right now is rick heinz. rieder and erin gibbs. thank you both for being here today. rick, you have about $680 billion in assets under management that you oversee. there are so many people who looking for yield in a low interest rate environment right now. what do you tell them? >> it's hard. we live in a world of slow global growth. rates are going to stay low for a long time. i think what people are challenged by is a wait until you get a higher rate environment. what do you do? you have to be tactical about
where you find opportunities. the high yield market has widened out and become attractive again. attractive when you get to 6%, which on a historic basis doesn't seem great. >> do you worry about investors reaching for yield or kind of throwing things out of whack because so many people are stretching so far? >> i do. part of why we've been adamant about policy is we're not in emergency conditions anymore. it's extraordinarily low interest rates. cash at zero means people need to look and extend to other things. i don't think it's a crisis today. i think it creates more stability and more natural equilibrium. >> what did you think of what we saw with the earnings season and
what we can earn potential next year with the s&p 500? >> it's really interesting when we look at companies. 74% of the s&p 500 companies beat --. it is typically 62%, 65%. that big change really surprised wall street. they really did earn a lot more. it came from having a lot less misses. q3 looks pretty solid. more than double. >> that's great news. one thing that could throw a wrench into the works next year is what happens to energy prices because energy makes up a big portion of the s&p 500. if energy prices continue at these low levels, what happens to prices for next year?
>> we've seen that. they have come down to 8% growth right now. we have seen that ratcheting down. considering how low the estimates have been to begin with and how we seen companies managing expectations, it does look like we're going to hit the upper single digits, low middle digits for next year's growth. >> let's talk a little bit about the u.s. economy. younger people are having trouble finding jobs because older people aren't leaving like they used to. what do you think about the u.s. economy overall? forget about the job issues we've had along the way. >> a recycling needs to take place. job openings are quite buoyant today. actually, they're quite strong. i think the u.s. economy is in strong shape. the tail winds are an innovation
in technology that's created more efficient production in the u.s. energy, the consumption multiplier you get from energy is incredible. you have a series of tail winds that we think are pretty powerful. i think people overestimate the fact that u.s. is a pretty closed economy relative to the rest of the world. i think the economy is going to be pretty solid. it is not fantastic growth, but i think we're going to be in the 3 to 3-plus gdp growth dynamic. >> erin, what are you watching in the year ahead? for us, i think there are few industries that are really attractive. the biotechs are really the
drivers of the health care sector we have seen. also airlines have been doing phenomenally well and shipping. >> especially with the holiday season approaching. >> exactly. and the other part is utilities. utilities for the southeast region of the u.s. has really seen a boom and those utilities actually have like 20% profit growth forecasted for next year. southeast utilities are a nice little niche. up next, we're "on the money." how ford is taking a big gamble with its new truck. trying new products can be an expensive gamble. take a look at how the stock
this week, ford rolls out its all-new all aluminum f-150. it's lighter. it's more efficient and it represents one of the biggest changes ford has gone through in its manufacturing process. we had a chance to speak to mark fields. we want to thank you very much for joining us today. >> oh, thanks for having me on, becky. >> the new truck has a lot of excitement out there. a lot of people bu it. s your bread and butter with the big profit margins we were talking about.
in terms of being excited about it, what did you think? and in terms of being worried, is there anything that keeps you up at night? >> no, this launch is exactly where we expected it to be. this is a big deal for our company. it's a big deal to our customers. we are very comfortable where we are with the launch. they're rolling down the line this week. we're launching it here in the plant. >> we see them rolling out behind you right now. mark, a lot of things determine consumer behavior. we've been watching gas prices at their lowest level in three years. $3 a gallon and lower in other parts of the country. what does that mean for ford? >> i think overall when you look at gas prices coming down, that puts more money in consumers'
pockets. that gives them more flexibility, whether they want to save that money or buy things, save for college education. clearly, it allows people to afford vehicles more. i think overall that's a positive for the auto industry and it is a positive for us as we're launching these new products this year. >> i wonder if you can tell me if you think the consumer is doing so much better or if auto sales are up? >> i think it's a number of factors. you're seeing replacement demand. 50% of the cars that are out on the road today are ten years or older. you're seeing a healthy level of replacements. when you look at consumer confidence, these days consumers
are feeling better about their job security. intere are relatively well. i think that bodes well in terms of the industry and economy going forward. i don't think we're in a peak. we'll probably see a little bit more growth, but i think that growth is sustainable over a period of time. >> i'm glad you brought up low interest rates. what happens as interest rates start to rise? i know it's going to be a slow and gradual rise, but how will it change the way americans buy cars and you finance cars? >> if interest rates rise, and they rise moderately, i think that's good for the economy. that means the economy is doing better. i think we have to look at it from that perspective. if interest rates rise, a lot of
customers finance their vehicle. putting it into the context of a generally improving economy, a generally improving employment situation, and i think that bodes well for the economy and industry and ford. >> we used to look at industry as very defined industries. increasingly, technology and the auto industry are combining and working together. i wonder how you maneuver that and what we can expect in the car of the future from ford? >> i think these days, as a company, we're thinking of ourselves as more of a mobility company rather than a truck and car company.
t the technology is mind-boggling. we're vi op think of the connected car being part of the internet and things, you think of mobility sharing. new retail approaches using technology. we're looking at that as a huge opportunity to move our company forward and continue to be in the lead in providing those kinds of solutions. >> mark, i want to thank you for your time today. >> thank you. up next, you've got mail. how a monthly subscription for beauty products is reinventing the retail experience. later, protecting your finances at every age. what to watch out for when it comes to safe guarding
it's a simple idea, but it is an original one. a $10 monthly beauty sample subscription service. a kit with samples is delivered right to your door. and for $20, there's an offering for men as well. is it more than a trend? does it make money? and just how does it work? joining us is katia beauchamp. >> thank you for having me. >> birchbox is an unusual idea. you have a lot of subscribers
right now. over 800,000? >> yes. we launched over four years ago. it is challenging to find and buy beauty products because so many are out there. even more challenging online. we developed a service that has allowed you to discover and shop for beauty online by having a subscription that's personalized for you of samples. you can try product before you buy them. remember, personalized. we pair that with content. we e-mail you that content. you can buy everything you have sampled in our online shop. try, learn, and buy. you can feel so comfortable shopping online for your beauty and grooming. >> when you say personalize, does that mean i pick what i
try? >> you fill out a beauty profile. that helps us understand you. as you rate them and purchase them, it continues to be personalized. it is always getting more adap d your behavior. we do have an element of choice. you are allowed to choose one product in the box or a specific feature box. if you want to choose, you can choose. it can be really delightful to have a surprise that is still tailored to you. >> if i'm a beauty products company, how do you work with those companies? >> that was one of our biggest insights. beauty brands, they want to have meaningful access to their consumer. before birchbox, trial was really limiting. it was done half hazardly.
we can get the right product in the right person's hands and then we can map their entire behavior from that. if you want that consumer to go deeper into your catalog, what are the products to use. >> i know you started this as a project after harvard business school. are you profitable at this point? >> definitely not. birchbox has grown very quickly with amazing fundamentals to date. we have decided we're continuing to invest and grow. we have had a privileged position of how we've been able to finance the company. up next, a look at the news for the week ahead and the holidays mean more family time, but is it a time to talk about finances? we have advice on how to approach a touchy combination,
be in brisbane, australia. wednesday, we'll be getting october housing starts. also the fed releases minutes from its last meeting. and the computer game changer. thursday also marks the 29th anniversary of the launch of microsoft windows. the upcoming holidays may have given you shopping, but how about a list for your financial health? you have a lot of people who will be seeing their relatives. what signs should they be looking for as to whether or not their elders can manage their money properly. >> it is a good time to check in. are they taking longer to make decisions? are today starting to forget things? are they paying a bill twice or
forgetting to pay a bill? if you're in a restaurant, do they take a longer time to see if a bill is right or tip? all good signs you need to have a chat. >> what tips are you can give people on how to be helpful? >> you have to be sure it is a discussion that everybody is receptive too. be sure the people involved, if it is a spouse, they should talk to each other. first, make sure they're discussing things. second, try to get their accounts consolidated. if something happened, you might be trying to track down things in every place they ever lived. get down to as few accounts as possible. the next thing is to make sure the legal stuff is in place. the wills are current, that they
really reflect the current wishes of the parents. if there is a financial power of attorney, that it works in the state they live in. >> really? state by state case. >> if they have relocated, it is still in effect. the next one is assign roles. if there are several children involved, you have one that is the point on financial decisions and the other that's the point on medical. and the people involved agree to the responsibility. the last thing if you're kind of thinking about it, you want to make sure you have regular meetings to discuss this. not five minutes before thanksgiving dinner. maybe have a financial planner. are you leaving opportunity on the table? >> you touched on the most important question, i think. if your parents or your elders don't want to have this discussion, how do you deal with that? >> i think it is very important to point out that this is their
plan. they own it. you're doing this to support them. in no way are you trying to take the keys away. we recommend you start the conversation when they're 50. >> thank you so much for coming in. >> thanks for having me. >> again, ted beck. that's the show for today. i'm becky quick. thank you so much for joining me. next week, how the find the best holiday shopping bargains. i'll see you next weekend. hey john, check it out. whoa! yeah, i was testing to see if we really can turn any device in your house into a tv. and the tablet worked just fine.
. >> taylor takes over. iggy rap splash. adam and blake dominate and arianna grande year. hi everybody. welcome to "access hollywood". special on music moment maker i'm shaun robinson. start with taylor who talked to liz about the huge risk she took straying from the signature country sound and crossing over completely to pop. were you more afraid of what the fan or critic would think or competition would think or community would think? did you have any of those anxieties. >> honestly going in the album for the first time i didn't necessarily worry about anyone would think. because i think at the end of the day what fans