Currency manipulation perhaps in they cut 950 jobs mortgage servicing. Basically they are shutting down businesses and spinning off some of that to fannie mae. Ever since i have been here the last five days, it seems like bad news after bad news. And i know you guys like to cover tech. And not the hard time that the banks are always having. You are losing people. You are not able to pay them as much. Google thomas and interesting google, an interesting week for google. They bought nest, the rmb is that maker. Now they are coming out with nest, the thermostat maker. Now they are coming out with this. Has a monitor for your glucose levels. This is for diabetics this could make it a lot easier. I am not diabetic, so i would not be the one using this fraud of. However having an antenna near my eyeball would really freak me out. Now they are going to know about my body chemistry . Im not sure i want google to know that stuff. We are also talking about the nsa and potential changes there. President obama making a stand it really kind of. Depends on what paper you read and what the headlines say one this. Is it a victory for privacy advocates or the nsa . What are the interesting stew meat is this is just an executive document. This can be totally one of the interesting things to me is this is just an executive document. This can be totally changed with the next president. And a lot of these changes may never happen. One of the big takeaways, the government is being open to companies that ask for data like facebook, google, apple those companies can be more open and transparent. However the fbi can still ask for information and i can come with a gag order. So there is always a contingency here. Talking about the contingencies jeffrey hayzlett, the former ceo of kodak. I know you are listening to the president s speech. Or did you fall asleep . No, i did not fall asleep. We got caught with our hand in the hr. This is what every country is doing in the world. They are spying on us. We are spying on them. What he is trying to do is to position himself what can we do not to go all the way but stay more in the framework of the law. This is political football, nothing more than that. They are not going to change the law. They are not going to do that. Unionthe state of the address, thats 11 days away. That is where it counts. I was talking to Richard Falcon rap earlier. He says that is where it is going to be. Not 11 days before. Daniel castro from the Information Technology and Innovation Foundation is joining us from atlanta. Daniel, what is your take away . Do you feel concrete things were said today . There were potentially two objectives for the speech. One was to reassure americans and foreign citizens they are not going to get spied on, and i think that is what the speech doing. Id succeed in what a lot of companies are looking at, will this restore a balanced Playing Field for u. S. Companies trying to operate abroad in foreign markets . With all the concern about nsa putting backdoors or weaknesses in u. S. Security products and tech products, we are not able to compete right now. The president really did not address that issue in todays speech. Daniel, i dont know if i buy that. This is a jewel to sell more. We are really good at those activities. Sell more. A tool to this is an opportunity to sell more and even better. No, i dont think so. The past few months we have had revelation after revelation that the nsa is involved in putting backdoors and products, coursing companies to lower the security and what they were selling. Or even that the nsa knew about zero day attacks. The Israeli Mossad has been doing this for a long time. If you even look at china. When i was the ceo of a fortune 100 company, i would not even turn on my computer or use my blackberry back then when i was in the country just because i knew people were looking. If you look at a while way , a chinese company, they have had huge problems selling abroad. The government is not buying from them. Many European Companies will not buy from them. They have pretty much given up on the u. S. Market. That is the same challenge that u. S. Companies now face when they sell to foreign markets, and they shouldnt have to. Now that we have entered this i. T. Revolution, we have known since the 1970s, we can have much other security than we had in the past. We can have the government working in cooperation with the private sector or opposing them. For the past 10 years, they have been opposing them. We have felt very secure about signing our personal data over to google, but not so much foreign governments. We the people are made of gmail users. If this is right there will be no significant negative reaction to obamas speech, and to the Intelligence Community can get back to this and this. The negative reaction to the revelations that Edward Snowden may some people said, i dont have a problem with it. Bad. Ot doing anything maybe this is about creating a better understanding what information are they collecting . How naive do we have to be to think this is not going on . If you say Thermo Nuclear device on a telephone call to anyone in the country luckily, i have never said that. And if you were, and having come from a Strong Military backpack, i would want to know these conversations were going on. A strongng come from military background, i would want to know these conversations were going on. Reported in the Third Quarter they had seen a decline in sales. They were blaming it on the nsa. And it is growing a lot faster than foreign capital. I do not think that the decline in sales had anything to do with that. I do not think that was in there for and look in forward looking items at all. I think they were using an excuse. Danielle, do you think we will see free trade here in Digital Goods or daniel, do you think we will see free trade here in Digital Goods or push for free trade . Intelligenceour agencies to gain information under certain conditions. The question is, can we set up theth so it is more or less same in the u. K. Or germany or australia so it does not matter where your data is stored. I think that is a reasonable goal to get to. All of these countries are doing the same thing. But they are using the fact that the u. S. Has gotten caught on this to get a competitive advantage. Daniel castro, thank you, and thank you for staying with us. Ave a lot to talk about we will be back in just a few minutes. Street smart welcome back tostreet smart. We are joined for the hour by former kodak ceo jeffrey hayzlett. Shopping a lot of Companies Got hit over the holiday season. They are bleeding foot traffic. That retailted outlets will lose money as we buy online and not in stores. But some retail outlets are brick and mortar from online. We want to bring in our guest from the no votes. Its great to be here. What is it like to have more physical presence . Lucky. Ot the idea was maybe customers still want to touch and feel close. It can be brought to you online. The idea was maybe customers still want to touch and feel clothes. This has evolved into what we call guide shop. This perspective, how does that very from one of the Big Department stores . You do not have inventory stocked there. Having inventory stocked people say that would not work. No one was to go win without being able to go out with clothes. What youre doing is capturing customer behavior. Every woman i talked to says they want to try it on. Some guys, too. They go win. Orthey take it with them order it there or go back online . We started in new york and we moved to chicago. Theres one in san francisco. What we found, we would in thosee businesses markets. You would have the great one to one interaction. But we ship it from bc d. C. Saiduld continue to offer choices in colors and sizes, which is the real pillar of the band of the brand. What is your overall cost . Since you are using stores for service and acquisition but not stocking, you end up delivering the best Customer Acquisition vehicle for the brand, and we find the customer is not just coming for what they started with but also suits and shirts with black suits and shirts levy tell you a true story. My husband loves bonobos. I love bonobos. We had a Great Customer service. Close, maybe the some things we would not have bought online. We made a list of potential things to buy and we never bought them. We never got around to it. I really wanted him to buy following up. I know, but when you do that version aspect of it, and how do you combat have you get consumers to make that extra step once they get home to actually buy these clothes . The conversion in our guide shop was 83 . 83 . Quit talking to her and find some more of that 83 , because that is big numbers. No one else is converting like that. That is a very odd to see that. Cost, not theles operational cost. Do you charge more if they come in the store . I would charge more because you wasted your time. You also have to make up what cost you are incurring. Our whole belief in the company is you can bundle great greatng clothing and service together. If you are brand focused, like ralph lauren you can put both of those together. Isnt that raising your cost . Ok, you want to talk about this. I have a sense. [laughter] in our industry, dollars per square foot tends to be triggered dollars. 300. But from a financial standpoint, we have a ton to prove, its exciting. It is exciting. Indo you see what they see the regular Retail Stores or are you beyond that . Because it is men shopping for themselves, our biggest quarters are q2 and q3. We do not have as much up, hey, it is black friday, come in. We do not want to create that kind of frenzy. And you are launching into womenswear. But that is a whole different market from just going to shop for sure. As sexy as that lingerie. Just fyi. To purchasemes in jeans, we are not going to let her leave without purchasing all right. It is all about better fitting jeans. On the retail side, they are all about discounts. They drove 70 the discounts and the christmas season. Ive got to imagine are you doing that as well . I cant report the numbers. Lastd our best margins year. Why cant you report the numbers . Do you have to ask somebodys permission . You are the head of the company. Let you walk away without answering the question. If guide is successful enough are you going to open more and more of them . We are blown away by the power of one to one human interactions. Ecommerce, everyone talks about it. It is huge. Why do we have to go through this kind of conversion . To understand that that has always worked. But were talking about intervention. Going to macys and thing it is the same except they have people waiting on you. If macys did the same and best buy did the same if you walk into a best buy, there is nobody there to wait on you. You cant find anybody. They are doing that. They are serving some people. That is the conversion youre providing. You can charge more for it and you do not have to revive the discount. Thank you for joining us. I am going to check out those genes. [laughter] im sorry. I will buy. I will buy. Welcome back to street smart. The average ticket for this years super bowl is running almost 4000. Yikes. Simba that is crazy. Ithersomes else you that is crazy. Is there Something Else you would spend that on . Tweet that at us. We will talk about that later in the show. [indiscernible] im doing a lot of flying. I am flying from paste from place to place. I am going to canada, l. A. And why . Are you flying i am doing a lot of speeches. Obviously,suites, for the show. But i do a lot of speeches. You are basically coaching executives . Yes. I will say, this is where this company failed. This is how you can get it done. I love the wifi, all of those things. You were recently in norway. Norway. Besides being a little chilly, what were you doing there . I was giving a little speech. And there are pictures actually. A female guard. A female guard. I put this on my facebook age. There were people at the reception. Guard nymphs. I put this on my facebook page. You do see occasionally female guards and soldiers and this was 1 what is this . This is a Little Village up what did they call those things . The fjords. This was a service i stopped by. They were doing the whole thing in norwegian. Just satd to it and there. If you are going to be on a plane that much in a year, what are you doing to maximize your time . Im one of those people as soon as they close the door, i can fall asleep on the plane. I cant do that. Do you do that with drugs western mark i can do that with drugs. Im not going to tell you about that. Do you do that with drugs . I can do that with drugs. Im not going to tell you about that. No, absolutely not. Do you fly at night . I fly late at night. That is the time that makes the most sense for me. What is the longest time you have done . I have done and around the world flight, from place to place to place. At about 26 hours. From here to australia. Better you than me, my friend. Better you than me. Hour. 26 past the our chief market correspondent julie hyman is on the markets 4s. How does it look . It is mixed, ladies. The nasdaq lower, the s p 500 lower. The dow holding up because of American Express and visa. Of this is earnings lets talk about a couple of these earnings related movers. Intel is one of them. The worlds biggest chip maker, forecast earnings less than analyst estimates. Computers do not use their chip and thats an issue. If you look at the margins for the unit using medical scanners, jet engines they expanded, but less than the ceos target. That is pushing those shares lower. We will back on the markets we will be back in less than 30 minutes and you have more street smart next. Welcome back to street smart. From the minutes closing bell. Im alix steel. And i am emily chang. We are here with jeffrey hayzlett. Suite. The c we have the word of the day. Bring it. Bring it. I have one for you, too. Chris christie. I think he is great. I love this guy. He is a good politician, and you know what . If i were him, i would take credit for closing down that bridge. I think that is what politician should do. What . In politics, that is what you do. No, no, no. What if someone died because he could not get to an emergency no, i agree with you there. I think he will come clean. I have one for you. Matthew martoma. I dont know. He is the guy who is on trial for Insider Trading at sac. I dont like any of these guys that do anything illegal. I hope they throw the book at them. I am from the school i hope that they throw the book at him. That just broke today. How about this uber . I love uber. It 7, 8 times a day. As long as i can get the car when i want. You know what i like about it . I can get a clean car. The driver will shut up if i do not want to talk to them. I took uber here. I will take it back to the office. I find myself interviewing a lot of mine uber drivers. They love it. In new york, you walk to a train, you swipe a card, you go down the stairs i love it. They dont have it everywhere. Las vegas it is not there. Miami. Its a little ironic. Get ready. Nintendo . Bad news nintendo. I know we are going to talk about this a little bit later. I will talk about nintendo. We will talk about it now. I think they really lost their it is so cute. It is a novelty. The new games look real. You get to shoot things. It is awesome. Ive got one. Target. A have a little problem with security, but i love the way the ceo came out. They got targeted. No one would have caught this, the way it was done. I think they are doing a good job. Y. Ey are upscale, tarja tarjay. Hey, i got one for you. I got one for you. Go daddy. Theyve got the super bowl commercials. They are really raunchy. Never heard of it. They are perfect. This is bad. Oh that was one of the pickiest moments. Ickyist i think they are the most degrading for women. They are a domain name company. Oh. But it is a good point. Is this actually good advertising . People talk about the commercials, but are they using the product . She does not know what it is. I stay away from them because of the way they do the commercials, but that is just me. Ive got one for you. Legalize pot. Legalize pot . Get in line. [laughter] im not too happy about it. In colorado, they have done it. South dakota. I have it growing on my farm wild. I have to chop it down. What dont you like about it . I dont think it is the right thing to do. The gateway . About ohio i cannot wait until i see people Walking Around new york. Marijuana ok . L i dont know. I do not know enough about it. Ok, what about this. Bitcoin. Bitcoin. Math. Matt. He wont shut up about it. Every time i turn around, everybody is talking about it. Everybody is talking about it. No, not everybody is talking about it. On in pr, i heard her grandmother call in and talk i heard a on npr, grandmother call in and talk about how she wanted to buy her grandson something cool for christmas and wanted to get him 50 worth of bitcoin. That is actually cool. Of this . Ou make it is a good pr tool and if i were the cmo of those companies, i would be doing it to. They are talking about it. I am talking about it. You are going to talk about it. We will be talking about it next hour. Do you have one more for us . Whats that . Do you have one more for us . Daddy was it. Bacon. Are you kidding . Bacon. D a photo of i broke my nieces resolution. Exercise. Exercise. Eggs are sides. For bacons. It got so many hits. Someone tweeted me the picture. He said, dude, how did you get my picture . How do you find the content that is the most viral, the most shareable. You never know what it is. What is it about that shirt that is so exciting . It was really what is it about that shirt that is so exciting . It was really cool. And it is bacon. Eat some bacon. We will be right back in two minutes. Welcome back to street smart. I am alix steel. This is emily chang. And we are with jeffrey hayzlett. Is this year in he different and how did it this way . Where joined we are joined by jeffrey lawrence. We should say at the outset that alix and i are stupid about football. It down. L dumb how our prices this year compared to previous years . About in line. I think people thought because it came to new york it would be astronomically priced. Ticket, as far as we are from the super bowl, it is about the same. 4000. Does that go down over the weekend . Next twoens the weeks . It probably will not go down until the super bowl masses the set. When we get within four or five days it might start to drop a bit. Most of the prizes prices are locked down by the corporations, the players themselves. How many are floating out there that you can actually buy . There are a few. Out of a total 40,000 people in the stands . 83,000. That is a pretty small percentage in terms of total numbers. Yes, theres a lot of corporate ticket holders, fans. And they sell them. A lot of those guys sell those tickets. Make some money. Thats right. Or let people in the back door. They dont do that. But they do. Idea of getting the tv, watching in the comfort of your home. The 49ers one thing i know, the 49ers are in the playoffs. I went to their new stadium. It is not ready yet. It is all teched out. It is supposed to be the most tech savvy stadium in america. How do they attract a crowd when the athome viewing experience is so good . They have to give them features that are not available at home, sideline audio, things like that. That will be a big part of the experience going forward. Things are competitive. I got invited you look at the game as a Business Opportunity . You are not going for the football . Absolutely. I will probably just watch a few minutes of the game. Is that part of the 4000 ticket . Absolutely. It is the person you are sitting next to, right . The one part of it that is really different this year are suites. 500,000. What is that . It is a private box that you can share with 20 of your best friends or associates. Typically they go for 500,000. Why . The new Jersey New YorkSuper Bowl Committee gave a big chunk to their sponsors. Theres a third of the regular number out there in the public market, so less supply, higher emand. I cannot stress enough that this is where you go to do business except for first class on an airplane. You know the person sitting next to you that you will do Better Business with that person. The people in the stands, paying 4000, 5,000 a ticket. Emily and i decided we would rather do other things than they 3800 to go to a football game. We wanted to share with you a little bit what we want to do. I went to see if this is on my list. For would rather get a made three months. I would rather take a plane to china to buy the new iphone 5s that is on sale today. To buy a car. E you can use the rest for insurance on the car. I would rather buy just about anything rather than a super bowl to get for 3800 dollars. Give it to charity. Oh, come on. Kauai right now i guess for 3800, i could take six people. Could be. If i put 3800 in a college fund at a six percent interest rate, it would be about 10,200 in 10 years which would pay for . Food for one year. [laughter] to viewers. We got some fun responses. One was would rather buy twitter stock. And they tweeted that to you. Would rather buy google glass, nest thermostat, and maybe a lounge chair. He probably has money to spare. I would rather go to las vegas, watch it there, party, and spend the rest of the money on shopping. Another one. Fly to vegas for a long weekend getaway. Vegas is popular. Vegas is always a big part of the super bowl. This year is no different. You can do on it. A parking spot at the super bowl about 10 of those for the average price. Parking spots are a hot commodity. You do not have to go to the game. I got an invitation to a tailgating party in the parking lot for about 600 you cant have a tailgating party in the parking lot. Yes, you can. If you pay 680. 400. Seconds is it worth it . I can remember who does the commercials and who does the best. Seven out of the best 21 commercials came from the super bowl last year. This is a big movement theyd moment. This is the super bowl advertising. It always is. Fortunes the ceo of fog 100 company of a fortune 100 company, everybody wanted to do a super bowl commercial and i kept saying no because you either have to hit it out of the park or you are going to spend a lot of money on a lot of activation. And now the activation is a week before the game. We appreciate you coming to talk to us area jeff, you are sticking with us. Absolutely. We will be right back. Welcome back to street smart. Hoste here with csuite and former kodak ceo jeffrey hayzlett. I want to test your management expertise. Uhoh. Microsoft looking for new ceo. Right now though Steve Ballmer is still ceo. You have to look at where the company is standing. They are a big company. They move a lot of stuff. I gave him a d when it comes to innovation. One of the most depressing People Places to work. Even though they have rejiggered how they are going to manage it now . Doesnt matter. When they are in a meeting, people keep their mouths shut. I do not know if i agree with the d. Marissa mayer, overall, you gave her ana, but you gave f for bonehead media moves. Just because i had to talk on air about that stupid logo she did you dont like that . Why not . I think it is a good thing that she did it. But if i were her, i would be in the back room working 24 hours a day, making sure this place gets back up. Last, the ceo of best buy. You gave him a c. I like this guy. I think he is doing the right moves. I just think he has a lot of pocket baggage to overcome. He has put on the blue shirt. This last quarter i mean, wearing red. They have gains of 20 in that industry. They could make it happen. Retail experience, the behavior is so bad now. You just go online, you order it. I agree. When i walk into a best buy store, i am so overwhelmed. I am so confused. The blue shirts, you cant find them. And there are three or four other people chasing them. Jeffrey hayzlett, a pleasure to have you here. Let us know about the super bowl. We will i will. More street smart straight ahead. Stay with bloomberg television. Hello, everyone on this fine afternoon as we head into a long weekend. Three days off. Looking forward to it. Welcome back to street smart. The s p off seven. The dow off nine. On the amex news. A lot of companies guiding down. There is a problem out there ubs. Companies not making the money they expected. Lets look at the top 10 stocks as we head into the close. Ups as a drop of nearly one percent as the shipping company missed analysts estimates. The attack of Online Shopping forced him to hire more temporary workers and they missed those holiday deliveries. As i know all too well. Yeah. I was one of those angry ubs customers. Oh, i am sorry. Intel down six percent. The and simmerat outlook for the pc demand is declining in asia. Consumer outlook for the pc demand is the climbing in asia. And a permissible Company Looking for approval from the fda for kemah jargon in the u. S. Ok, we are looking at elizabeth arden, number seven. The beauty product maker gave a dismal Fourth Quarter. They have been reluctant to offer heavy promotions during the holiday season. I like how you said that. Dismal. Diss. Get it. All right, electronic arts, jumping 11 . The maker of matt and football ames has been rated madden buy. Matt, you will be playing does. I spent six hours playing call of duty. And need for speed rivals. Firm for that the stock will raise 75 a share by the end of the year. One of the most optimistic outlooks for analyst covering sweater. Was 75. St why settle for paying three and at times cash flow [laughter] i dont really get it. I think this is just a play on someone wanting a social Media Company in their portfolio. Facebook is what . One billion. They can possibly build on that. What about twitter . You both use it a lot. It is too many. It is too much. You have to be in that moment. I will show you how to use tweetdeck, trish. Are so organized. American express climbing four percent. The dow has benefited from the pickup as well. And Consumer Confidence met more home card purchases. Says Fourth Quarter rockets fell profits fell 22 . It will issued 2014 guidance once the separation is complete. And we hear the closing bell. I did not realize we were off that much. We missed the bell by a little bit. Profit margin growth false start of projections. It trails a 70 basis points in growth the ceo laid out in december 2012. Cracks are number one stock of the day morgan stanley. Shares up 4 , rising the most in six months. Higher equity trading revenue. Record Wealth Management earnings. It is a tie. I was going to say, there is the closing bell, but that already happened. Chatty cathys. The game is down 0. 4 . The nasdaq was up. It is curious. You are doing the same thing a little bit. All 10 sectors are down. Not by a lot. Everything was down, even utilities. A little bit. But still down. Roundup . Lets do it. Special guest with us. None other than the bloomberg contributing editor. China mobile was the big story today. China mobile is now selling iphones in china. They had about a million pre orders. Mobile has 763 million subscribers. That is twice as many people as there are americans. So canadians in there. No one lives in canada. I get to say that. It is still more. It is giant. Tim cook went there. He was asked, what is happening . What about bigger screens . He said, you can expect great things. People are wondering, is that a throwaway comment . Or are they going to have bigger screens . He has got nothing. He has bigger plans to play in this market. Imagine the volume. China, 763 about million customers. That is huge. More than double the population of the u. S. Bitcoin . Yes. The chinese obviously have been cracking down on bitcoin. They crack down on a lot of things. If you want to do business in china, i think you have to sacrifice a fair amount of your american principals to do business. It took apple six years to let chinese authorities agreed. Maybe it took six years before apple was willing to do some of the things they had to do to operate in china. Swallow your pride to go there. That was my not so eloquent segue into bitcoin, right . The Sacramento Kings are the first major sports franchise to accept it coin. , jerseys,uy tickets and stuff from the souvenir shop for bit corn. Bitcoin. March 1, the internet starts accepting bitcoin for reservations. I think it is a p. R. Stunt. Uses bitcoin,ho not the most popular guy. This is more of a gimmick than the fact that their customers are clamoring for it. You are probably right. I will say overstock. Com started taking bitcoin and did 126,000 business the first day. It is not substantial for them. Is still it is cool. This is really cool. There are 20,000 retailers. They are using bit hey. That means they actually get dollars. They will take bitcoin but will not take American Express. For ak about bitpay minute. The whole thing has gone legit. Is one of the Third Party Software providers and Solution Providers that allows merchants to accept dollars by taking bitcoin. They instantly get rid of the forex spreads. 20,000 merchants are accepting bitpay, and they say a thousand a week are being added. That is not very many. It is not a lot. I will give you the hype. Only six months ago that trish called me on a sunday morning and said, we have to talk about bitcoin. York. Nd a bar in new you have been there. Night, i was googling and shooting the story. It is the first bar in all of manhattan. 70 . My point is, that was the york, and now it is how many . They are just following matt around. The bottom line is, if people want to pay you in bitcoin and you have no problem and also lighter fees to take it then American Express, visa, or mastercard, why wouldnt you take it . You would, if it gets too enough demand. You have to add a lot more zeros behind the numbers. It,he more businesses take the more it will mean for the currency itself. It is extremely volatile. With the exchange rate. But this could change it. I have been using it now for a month. I have bought everything. Something revolutionary comes out of google. They have a new contact lens. Available yet for consumption. They are testing it. They announced it on the blog. Can you eat it . Those coils that is a sensor with a computer chip that registers the glucose level in your tears. In other words, if you are diabetic and typically have to prick your finger throughout the day, this is a way of avoiding that. As is obviously very good for diabetics. Think about it for pepsi and coke. This is great news for them. Diabetes is no longer painful. That is one way to look at it. This is big news. Lobbyist forbe a the American Diabetes association. His is a real cool use of wearable technology. Every time you have to test yourself for diabetes, you have to stick your blood and read it. It is cumbersome. Think about what can come from this. Imagine if you could read your blood alcohol level. It either corrects your blurred vision or blacks you out. A brother is watching. There are cool things. Imagine if the nsa is reading your glucose and blood alcohol levels. Maybe that would reduce the number of fatalities. Something to Pay Lip Service to for a moment the fact that google is no longer a Search Engine business. They still get 87 of their revenues, but this is a transformative company. They are diversifying. It is cool to see a company put money back into r d and make things that work. I think it is a good thing. I wonder if this is a good thing, legalize marijuana. Senate majority leader harry reid coming out and saying that maybe it is ok. Nevada municipalities are issuing moratoriums on medical marijuana dispensaries. The Las Vegas Sun asked him about making medical marijuana legal. Here is what he said. Question ad me this dozen years ago, i would have said no. Gateway drug, right . He was talking about medical marijuana, not recreational marijuana. He cannot say that anymore. He is changing his tune. The reason . The votes. Think of how this can mobilize people. Cannot sayying, i that because i cannot afford to lose the votes. I am not sure that makes him a supporter. Where is he from . Nevada is the biggest fisa state in the world. Biggest vice state in the world. All kinds of things that are not legal in other states. They are catching up. The gateway drug thing is the most ridiculous thing. That it is or is not . You are totally wrong. You are totally wrong, and here is why. 10 years ago in portugal, they decriminalized all drugs. Moneylly, they took old they were spending arresting people for marijuana or other things thomas put it into education programs, hoping his kids did not use marijuana it would not progress to other things. Guess what . Usage levels have plummeted will stop absolutely plummeted among the youth. They felt and this is the gateway theory. If kids usedthat pot that they would use other things. What about kids that use beer . Are they end up using other drugs . If it is illegal, you are dealing with someone who is dealing you a drug. Trish on this. She has been doing more stories on this than probably anybody else. You knowny people do that smoke pot that do not do heroin . I do not know a lot of people that actually smoke pot. Or they do not tell me. I am fine with it. I am going to help you out with a study published in the journal of the American Medical Association am a done in australia a couple of years ago. Teens under 17 who were smoking pot were to 25 times more likely to become alcoholics. 5 times more likely to become alcoholics. This is what they found in portugal. By decriminalizing all drugs, you did not have the chance that people were going to go to a dealer for one drug and get to the other. The thinking in colorado is, if this is legal recreationally it is more like alcohol. People are not brought into that underworld. Everybody has an opinion about it. By the way, drugs affect every family across the board. It is an emotional issue. I think that will weigh in. That nevada are just finally catching up. It is not like nicotine or alcohol. You mean those do not count. Those will kill you, but you mean other stuff. They will kill you legally. I do not know that they make everybody happy. I will talk about something to make everybody happy. The president of nintendo said the company is considering a new business model, or casting a surprise 240 million annual loss because they did not sell any of that wii u. Obviously, that is not very different for a business the size, right . A sickly, they are breaking even either way. Except on a different side of the pml. Pml. P l. Most people i knew just stuck with the wii. This was a typo when i first read it. 70. Cut it by 70 i thought maybe that was a typo. This is a big slam. Do you want a . A hashtag . Fail. Games look real. You played it for what, six hours last night . Great relationships can go on. Regardless of that, the other one looks like we pulled up some of the video clips. The wii are not going to get involved for six hours. Unless you are playing mario world. It does not look real. But it is with an avatar. We have done it. It is fun playing the bowling game. I have a little guy with a mustache. I do that kind of stuff. Open i am playing xbox, which i have done, it looks like i am really there. I can feel it. The problem for nintendo is, and you think of the wii, you think of the first wii we all bought. Is the one no one has heard about. It came out last year and nobody heard of it. We have no idea what it cost. I have no interest in it. It is not that cool. No one cares about me new one. Fail. Peter king will tell us what he thinks about the new limits on nsa surveillance. And then, one of the nations most secretive agencies and vegass most expensive table. He thinks about the new limits on nsa surveillance. Las vegas high rollers are connoisseurs of the good life, because they get all kinds of perks from casinos. This year, the nightclub in the bellagio has the outdone itself. A table worth 250,000 a night. At the exclusive nightclub, one of the most expensive cables in the world. I like this table. Absolutely gorgeous. Part of its value . The view. 1200 waterspraying robots. Feet, aoslm hig as thelding. It cost 40 million. Inside, the fountains are made of champagne. It is the most profitable club in vegas. The average table costs 8,000 a night. This one . 250,000. What makes the difference . This red button. Here we go. Sets off these fountains. Reserved people who the table in 2013 . Two. I just want to keep hitting the fountain. It was very expensive. 10,000 every time you press a button . Didnt you feel bad . It was not on us. The big rulers. I cannot wait to see the piece. Tuesday night at 9 00 p. M. They have to have those fountains going off on a regular basis anyway. Either they push the button for 10,000 or you push it. Much better if you push it. Definitely better. The table only booked twice a year. That table was only booked twice a year. It is one of those perks they give you. If your guy is going to spend 3 million, they are doing anything they can to get you in the door, including offering that table. If your guy is going to how dn at a casino . It is amazing. I was with steve wynn in his office. I said the exact same thing to him. I cannot believe anyone would come here and spend 3 million. He picks up the phone and calls the floor manager. He talks about one guy who is still out on the floor. , 4guy had spent 3 million million in the last couple of days. The casinos know, at the end of the day, if you keep playing, you are probably going to lose. Said, if someone spends 200,000, you can cut them 80 80,000. That is about the ratio. In this documentary, you are going to meet a guy who basically learns to exploit the casinos don johnson. Different don johnson. This one is a legend. He won 15 million. The miami vice guy is not a legend . He won 15 million in about three months, playing at Atlantic City casinos. He did not cheat. He did not count cards in an elaborate way, more than you or i might. He is probably a better mathematician than we are. How did he do it . This looks at how he exploited the vulnerabilities of the Casino Industry, where they were willing to offer him better odds. It is quite something. He does not have just one trick. He has a number of strategies and tricks he uses. Listen to this. Like bobby riggs. This was the best. You are just trying to beat the dealer. You need to distract the dealer. If they goof up, it is a free bet for you. So he surrounds himself with strippers. I love that. The dealers get distracted. Ladies to deal. They guy is going to look at the stripper. I think everybody is going to look at a stripper. You bring a stripper into a room full of regular people, it is enthralling. That is my favorite detail. The whole documentary goes through what the Casino Industry is up against. Tuesday night at 9 00. And how you can beat the house if you are don johnson. Tuesday night, 9 00 p. M. , the player. Set your dvr or watch it on bloomberg. Com after. Coming up, we are going to have a little talk about where all the shoppers have gone and which shops are vulnerable. Breaking news. The board of joseph a bank has rejected the unsolicited takeover offer from mens wearhouse. This is the second unsolicited takeover offer. The bid was up to 57. 50 a share. The board has rejected that offer. They are telling stockholders not to tender shares. Consumer, where art thou . Time for a little insight in action. Lastat the news over the 24 hours. Ups, nintendo, and best buy trending lower. The companys guiding lower, but stocks are still up. Sense. Es not make any our concern is, who is next . 355 retail ande consumer stocks in the s p 1500. On hundred 11 reporting in the next few weeks. 19 of those, analysts lowered their numbers. D, ebay, expedia, ralph lauren. If you want to see the full list , go to twitter. I posted a link to the blog. Ask last years most hated etf hoss might become the loved ones this year. Tell us about some of these surprise turnarounds. This year so far, expect the unexpected. One example that was hated last year and is bouncing back is the Ishares NationalMunicipal Bond ipf ietf. This has bounced up 2 . It went several months without closing at a discount every day. It closed at a premium and had some inflows, both good indicators that meanies could be back yielding 3 , which is about 5 on a tax equivalent basis. Another man that is interesting is junior gold miners. This is kind of a leveraged play on gold. The gold miners etf is up 6 , doubling the gold miners. This will give extra pop if they continue to rebound. Treasury etfplus that is a mouthful. The longdated treasuries are having a bit of a rebound. Rates have fallen a bit. This is up 6 after losing 21 last year. This would have seemed a crazy investment about two months ago. You have something up 6 . The singleat was best performing etf of all of them. It returned 51 . This has a duration of 18 years. It is very sensitive to rates. If they fall, that will shoot up. Analysts. Stock if you hear people talking about earnings and cash flow, these package that for you. The revenue shares largecap fund. It looks at the ventricle of revenue. Bys is outpacing the s p 500 4 last year, and 25 over five years. It takes the stocks in the s p, weighted by revenue, rebalanced quarterly. They have a whole series of revenue shares. They are that committed to that fundamental. The oldest and largest. Back in 2005, this launched. This uses a series of cash flow book value sales and dividends. Approach. Ltifaceted it beat the market by 2 last year, and 43 over the last five years. Stockpicking works. These are not active stock managers. Are rules, these based. You know the rules ahead of time. They rebalance, score them, and balance on that. It is not like somebody is picking stocks. They call it cause i active. Quasiactive. This stands for earnings per share. It is the wisdom tree earnings 500 bps. Etf. This hones in on stocks that have the highest earnings. It rebalance his quarterly. This has edged out the market by about eight percent. Since its inception, it is up about three percent over the s p. Eps to do the legwork, i think these deliver the value. As always, you are full of knowledge. And you for making the trip and from the princeton office. Thank you. See you again next friday. President obama came out with a longawaited response to nsa intelligence gathering today, and he came out swinging, saying it is necessary for the fight against terrorism. The men and women of the Intelligence Community, including the nsa, consistently follow parameters designed to protect the privacy of ordinary people. They are not abusing authorities in order to listen to your private phone calls or read your emails. Mistakes are made, which is inevitable in any large and complicated human and price, they correct those mistakes human enterprise, they correct those mistakes. He talked about moving data storage away from the nsa, halting surveillance of her and lay leaders, requiring judicial approval, and asking congress to review changes. We are joined by republican representative peter king of new york and the principle of the chertoff group. Thank you for joining us. In the past, you described curbing the nsa as surrender to political correctness. What do you make of the president s recommendations . For the most part, the program is intact. The president basically said how vital it is and the changes he is making. He says he wants the metadata to be taken from the nsa, and private companies would not be e to take it will stop take it. He will try to find a third party. In the meantime, the status quo will be the same, other than that the nsa will have to get Court Approval when it drills down into the metadata, unless there is emergency. That is workable. I hope the court can speed it up. In the past, it is sometimes nine days to get a court order. But i think that can be arranged. Considering all that has gone on, i think the nsa is still pretty much intact. Talking to people at the nsa, they feel this is doable. I do not think these reforms are necessary. As a practical matter, the president felt he had to do it. I think the nsa will still be able to carry out its mission. You have advised the white house and the nypd. Any substantive changes . They are very modest. Convolutedsomewhat speech that made a few changes at the margins of the program. I see very little change in the essence of the program. Essentially, he is talking about certain limitations on how the government uses the data, but no real limitation on what the government collects. There is nuance about how one type of telephone metadata is stored. He poses that to congress, but has no can create suggestion on what to do on that thorny topic. Representative keating, is there any way you chair the subcommittee on counterterrorism. Is there any way to quantify Data Collection has been effective . Number of slots number of plots sorted . Data i believe in the overall mosaic. One example i can give is the attempted subway attack and 2009, where they used section 702 of the patriot act to learn more was happening overseas. Once that was obtained, they , the metadata, and found out who was in contact in this country. One of the people apprehended under that is now serving a life sentence. It is stopping attacks. It provides often a mosaic or bigger picture. We will know the extent and also we could rule people out. For instance, overseas, we were concerned it might affect the united states. Me, it is interesting. You go from george bush and eight cheney to president obama and his administration. They all see the need for this in one form or another. Estimatedlion is the cost to u. S. Businesses of all of this surveillance. What is an acceptable cost . I am not sure what that number is coming from. But we can afford this. There is no question. Department of homeland security, this is manageable. Experience, every single important counterterrorism case i encountered electronic surveillance was central to the resolution of the plot. He has cited the canonical case, which is a plot against the new york city subway. It was used by everyone. President obama acknowledges this as part of his relatively complex defense of the program. Even the 9 11 plot, there was a possibility of identifying one of the plotters, and it was mixed because of the absence of a metadata program, the sort of which he defended today. Run foright make a president. You have said you might. What would your nsa look like . That is a long way off. As far as the nsa, i would keep it pretty much the way act up for a second. I think you told a Radio Station in my home state of New Hampshire you would consider it. I said i would consider it. But he took it a step forward and said i was announcing. We are definitely working on it, but it is a long way off. If i did become president , i would try to entice Richard Falkenrath back into the government, because the assistance he gave us in the days after 9 11 was essential. You will have to get him away from me first. Good to have you here. Thank you, terse. Trish. Pimm, what have you got coming up . No pimm and he has a big interview coming up. He is prepping with the former director of the nsa. President obama may be overhauling the nsa. That does not mean you can put your spyware away. We bring you the business pop culture. And hollywood heavyweights are chasing oscar gold. There is one tv start going after the real deal. [singing] this is my kind of show. This is discovery channels gold beijing opera singer on the hit beringbearing see sea gold. She will stop short of nothing to find treasure, even if it is hidden in the alaskan water. You want to be on opera singer, but you have your own ship and are mining for gold in the water. You are the only girl. You are the cap did. What is that like . A fascinating story. It is aluminum pontoons that mostly float. They mostly get us to the harbor. Im want to raise the funds to pursue a masters degree in operatic performance abroad. I mind up falling in love with gold. I have a special connection. It is so elusive and so addictive, you cannot help but love it and hated at the same time. It totally corrupts your soul. It is kind of a tough run. A lot of the time, we are selling ounce by ounce to keep surviving. It takes fuel to get out there. The fuel is incredibly expensive. About six dollars 50 a gallon for diesel. You are living from half ounce to ounce. Gold prices have been a little bit dicey over the years. When i first started, they were at 19. 50. Now they are at 12. 50. Opera is further away. Exactly. To fund an opera career. My ulterior love is opera singer. You are a mezzo . And you are a soprano. I was. Deal. Sh is the real your goal is to go on and be on the International Opera circuit. Leave the gold digging behind. It is a hard battle. I do love to mine for gold, but i also love to sing. It is a weird combination. What do you think . Are you trying to get her to sing . We do not want to put you on the spot or anything. Apparently i have to sing now. You are a mezzo. Would you . I would love to. Good for her. We have never done this on the show before. This is cool. Opera]ging metropolitan opera, i hope you heard that. That was fantastic. Great job. We wish you all the luck. We are going to watch your show. All the best to you. Fantastic. Carmen. And you can watch her every friday night at 10 00 p. M. On the discovery channel. I want everyone to have a terrific long weekend. We have a big week ahead. Tuesday, mayor bloomberg and bill gates. It is 56 past the hour. Let us get you caught up on were markets ended. They relatively mixed today. The dow was in positive territory. The s p was down. In the s p, the biggest drag on the index was consumer staples. You also had technology and industrials. Overall, you had Building Permits and Housing Starts lower than estimated. The Housing Market is showing signs of stabilizing. At the heart today, it was all about earnings. Manufacturing units fell short of estimates. Ups said its earnings would disappoint for the Fourth Quarter. A sickly, it had to hire more workers. It still missed on holiday liberties. A big drop, the biggest in more than a decade yesterday. U. S. Holiday sales down by 1. 5 . That was matt miller staying crushed. Investors wondered what was happening next. I bring in my colleagues, matt miller and olivia sterns. I am going to keep watching out for earnings, because i really have been surprised. Obviously, not Many Companies have reported him. I guess 6 or 7 so far. More than half have missed earnings expectations. Analysts are professional low bowlers. And Companies Want to global owball themselves. You want to under promise and over deliver. Normally, we see 6 of Companies Beat earnings estimates. Right now, 48 have beaten. It is not looking great. I think Robert Albertson was on this morning. Microsoft is coming out next week among a slew of other important consumer names. We are expecting them to show a drop even though they will show growth on the revenue side. Maybe they will Say Something about their ceo search. Maybe you can talk with alan mulally in new york. But he does not have any intention. Jobo one wants to take the at microsoft. It is a difficult job. It looks like they have their eye on three main contenders. One internal guy is there head of is the head of cloud computing. It will be interesting to see. Olivia, you are going overseas. I am not actually going to doorposts this year, but up this year. Vos shinzo abe eight, the japanese Prime Minister listen. Abenomics. Pay attention. He is going to be the keynote speaker. We will hear a lot about currency. We will hear what the europeans and leaders around the world think about the nsa. We have tech nerds. We have microsoft. And climate nerds. They use so much. Thank u so much. Pimm fox will sit down with the former director of the nsa and cia. This is taking stock for friday, january 17. I am pimm fox. The National Security agency, i will be speaking with a formal nsa direct your michael hayden, who has been critical of the obama administration. It all hidden will be joined by the chairman of the house intelligence committee. We will have all of that and more of the