The s p, you can see it is off about 89 points and the nasdaq as well. This is not bad considering the losses we saw earlier. It looks like the bulls have been defending their turf. The dow was down more than 200 points. Like it feels like it is an effective what is happening overseas. So you have investors piling into safe havens such as gold and treasures. Gold headed for its onemonth high. Here with us bill white, former deputy secretary of energy under president clinton, now the of then and author upcoming book americas fiscal constitution. What do you think is going on here . Is this a correction after the s p rose nearly 30 or part of a bigger route . I learned that you cannot week ofmuch for one market action. If you look at where we have been over the last six months, a year, if there had not been a break there would have been something fishy. Can you imagine investing in this kind of market . , companies ares pretty strong. Expect to see a bounce like we have had since the bottom we made back in 2009 . I would not bet on that great when you look at the alternatives out there for orestors on fixed income what is happening in the last several weeks and National Market what do you make of these huge moves we have been seeing in the treasury markets . The yield on the 10year has since thebasis points u. S. Was downgraded. It seems to me that tells you that maybe there was an overreaction to the taper comments. Five or 10 years from now, you Better Believe that Interest Rates will be closer to the mean than they are today. Keystone, a turn to topic that affects your state. The state department releasing a report saying that the keystone xl pipeline will not significantly worsen crime and change. Phil mattingly has the story Climate Change. Phil mattingly has the story. Were hopingntalists that the report would have major changes to support their cause against the keystone xl pipeline. There were no major revisions in terms of the impact Statement Released by the state department. They did not see any major impact this pipeline would have on Climate Change. The president last year said basically if he would approve this, it could not have major impact on Climate Change. The state Department Says it does not. Theou are a supporter of Keystone Pipeline, this is a big step in the right direction. How about the opponents . We have heard so much from environmental activists. What are the critics saying . Theres a couple things they are taking away from this. It is not over yet. Theyre going to be another eight agencies and Public Comment period to look at this proposal. What most environmentalists are clinging to right now, this would always end up on the president s desk. Of an issue this important, he was going to. Theyre going to focus entirely on the white house. Theres no timeline of when the president might weigh in on this but you can bet his office will be inundated from the environmentalists in the months ahead. Indeed. Thank you, phil mattingly. Environmentalists likely to be calling of the president is tom stier, the billionaire investor in california who has been waging this war against the Keystone Pipeline. He says he wants the president to do the right thing. He says the pipeline will not itate the amount of jobs purports, and it risks the climate and the environment here. What do you think . I am an environmentalist, and i believe we ought to take aggressive action to reduce the risk of Climate Change. It is sure a lot safer and better for the environment to transport oil by pipeline than it is by rail or by tanker. To folks in the environmental movement, i would say if we want fuels,ce Transportation Fuel economy vehicles. I drive a fuel economy vehicle. You said all the [indiscernible] over the pipeline feels like a tempest in a teapot. We have had a Record Number of pipelines built in the u. S. We are seeing a revival of hydrocarbon production. There will be a reduction of tankers coming into the u. S. And canada. There will be pipelines built to take canadian natural gas to the pacific. Gotink the both sides caught up on keystone is a political issue. Those of us who believe we ought to stick the science to science when we are dealing with Climate Change deniers ought to stick to science when it comes to pipeline safety. Can you guys roll that video of me and tom stier . We are out in mayflower, arkansas in this video. There is a separate pipeline, not the keystone. It was carrying the same kind of tar sands from canada that this pipeline would. He was trying to show me, with these pipelines, they do burst in time with age. Environmental are damages that can happen from this. He was trying to show me what was happening in this place. When you say, it is safer to transport it to the pipeline rather than through trains and trucks, he would point to a place like that and say, its not. The question we should all ask ourselves is, how typical is this and what can we do to reduce the risk. I do not think anybody would seriously say we ought to rip all the pipelines out of the United States and put things on a train. If you think all pipelines are more dangerous than trains or tankers, you would be led to that conclusion. Phil, this is the state department weighing in. At some point the president is going to weigh in. When do we expect to hear from him . Unclear on the timeline. The white house and white house aides have been cleared through this process, they do not want anything to do with this right now. Everybody knows it will end up coming to them at some point but they have constantly swatted this away towards the state department, pretty much nonstop for the better part of the last year, year and a half. The time with that is running out. You have 90 days left for review. They will continue to push this towards the state department, but after that it is all on them. Then it becomes all about the white house. It is a political hot button issue. It is also a policy one. As we get into election season, decisions will have to be made. Now that it has the state department stamp of approval, doesnt that mean it is closer to being a done deal . That is the read from analysts. The president has not weighed into heavily on this. Said, if it has an impact on Climate Change, i will have a problem with it. According to his own administration, it does not. I think the assumption right now from transcanada is that this is a huge step forward and it starts taking away the options the president has for reasons to say no right now. Thanks, phil. Tell us how in houston, texas, how north america could benefit from keystone. In general, we benefit in the u. S. By having more jobs in the u. S. And canada. There are canadians who work here. You should see how many u. S. Citizens working in alberta, canada these days i would rather see oil produced in north america than oil produced in the persian gulf. Not because im against the persian gulf, but why not have domestic jobs as opposed to foreign jobs . There are questions about the amount of jobs that will be created, but the other argument is this is oil that will not be used in the u. S. It will be refined in the gulf and exported overseas. The u. S. Is still significant net importer of oil. I will say one other thing. To show how distorted the conversation is, i have seen some people say, if we disapprove this, this is an attack on canada. You have seen that too. I think if the science says no Significant Impact on Climate Change and it conforms with existing rules on safety, it ought to be permitted. Cannot event canada get crude oil and natural gas from alberta to british columbia. Mayor, i respect property rights, and nobody wants something that will burst. Are staying with us. Our thanks to phil mattingly. Coming up next, do cities need tax incentives for businesses and jobs . President obama. Et with a big group of ceos there are nearly 4 million americans who have not found a job for at least six months and longer. Here with us is the former houston mayor bill white. Unemployment is something you had to tackle through your three terms as mayor in houston. Has a relatively low Unemployment Rate, 5. 5 . How is the city been able to do that . Has it been because of the Energy Industry . You start with a strong community, affordability. At where we had long term unemployed, the toughest issue i confronted as mayor is what to do with people are first offenders. They have a record, and they dont have all the skills when they get out there i. If the only people willing to offer them a job are the old gang they used to run with, they will be back in jail again. Its a very serious and tough issue. A big of an impact to you think a voluntary pledge like this can have . A manager who sees that somebody has been out of work for 18 months is probably a lot less likely to invite them in for an interview that somebody who is still working. I hope it will have an impact. Not everybody is entitled to work, if they are not performing well. Sometimes we find that people who have been out of work for a while are some of the most motivated employees there are. Seems people are not happy in whatever position they are in. The flipside, cities themselves are looking to bring talent in, to fill certain jobs. You have cities all over the country who say, i want to build the next silicon valley. Some are doing it through a tax incentive. Is it something you agree with . No. You begin with quality of life, affordability, efficient services, Public Safety and education, schools that do a good job, clean air. Those are the basic Building Blocks for community development. And then the marketplace should be able to identify where there is concentration of skills or talent. Too often what i have seen is they offer a tax break to this an unlevelt creates playing field, and then it depends on who you know at city hall. Then they say, weve got to offer it to everybody. After a while, people have got to ask themselves, who are going to pay the taxes to improve the schools and who gets left out in the tax giveaway . We hear so much about hollywood coming to new york because of tax incentives for the movie industry. Everyone says this is a tax windfall and good for the city. This is politically incorrect, but i think a lot of people in politics in both appalled to see some conservatives, they get elected to office and want to have a brochure of commercials they say they created link number of jobs. Jobs. Lank number of most of it is created in the private sector. Toyou think youre going attract somebody with a property tax break, the odds is they are just lowering somebodys taxes but perhaps you can attract them to shoot their bigbudget film. Perhaps. But that will not create permanent jobs. True. Essentially, would you say you may have committed that crime yourself when you were in office . I was pretty good about it. I was pretty good about saying no. They may that at times have a useful purpose where somebody is really being a pioneer in something and taking high risk. Theeneral we ought to let market determine where those particular headquarters are located. Say thatu trying to cities themselves are you trying to say government does not create jobs . Its really the private sector that are the drivers of it. Local government can be critical for creating conditions like safety, schools, affordable housing, affordable level of housing and taxes that will attract businesses to the community. That is what they will be paying attention on, not trying to say, that company is going to be a winner but somebody who has been here for longer to create a level playing field. And concentrate on what make it easier for people to get from where they live to where they work. That is pretty much in line with what the former new york city mayor, mike bloomberg, what he said to us a few weeks ago about the role of cities. If you take a look at most of the progress that has been made in Climate Change, it has all been done at the city level. Even in this country. When we are fighting guns, obesity, trying to improve the School Systems and bring down crime, those are done at the city level. People do tend to forget that. Comes to everything from the control to Climate Change, it really rests with mayors. Education, so much else. If you are a mayor, you are pretty close to the citizens because they will tell you what they think. Coming up, more with bill white. We will talk about an issue near and dear to his own state. Immigration. In todays global outlook, were focusing on the likelihood of Immigration Reform. Here is the president earlier today on cnn. Theor a lot of families, fear of deportation is one of the biggest concerns theyve got. That is why we took executive actions, given my discretion, to make sure we are not deporting kids who grew up here and are americans, for all practical purposes. But we need to get that codified. The question is, is there more that we can do in that list legislature this legislature that so please broader problems. Boradern solve these broader problems. He ran for governor as well. This is a big issue in texas. Do you think this is the year that Immigration Reform gets done . I sure hope so. The whole country would benefit if we moved away from the gray market approach and regulated labor and we knew who was in the country and people paid taxes. Right now there is a great market where employers cannot really tell. Theres unique way no unique way of identifying whether somebody is legal or a nonlegal residents. Forant people who work years in this country and work hard, raise their kids in this country. The kids have served in the military. To be able to stay in this country and contribute. Do you think people should be deported . There should be a way of be a way that people can earn their way to permanent residents. Whatever we can get past congress that would normalize and regulate the labor market to allow us to grow with immigrants personally, i will tell you a story that everybody watching this could see. I was at a Naturalization Service where we had all these proud new americans. There was the parents of this one young woman who couldnt be there. Were given her citizenship. She had died serving our country and died in the last week serving as a military enlisted person in iraq. Theres a lot of new americans that appreciate citizenship more than a lot of people who have inherited their citizenship. We need vitality like that. One of the most hot button issues in texas is the issue of a fence. Should there be a fence . We ought to have better Border Security. I do not think the fence is the best way to do that. The best Border Security would be to make sure there is a market where you could crack down on employers who disobey and the rules were reasonable, for the country in the long run. All right, bill, you are staying with us. It is 26 past the hour. Lets get to mark crumpton. Thanks so much. 90 minutes left of trading in january. Red is the color of the month. Look at the boards. Now industrials down three quarters of a percent. Of market movers, mastercard part of the selloff, shares of the secondlargest u. S. Payments network tumbling after it missed analystss limits. A 30 rise in profits after luring her customers through its doors. Quickly i just about 30 minutes away from the closing bell. It is almost the weekend. On everyones mind is the super bowl. And you are going to the game. That is huge. I have gone for the last two games, actually. Know the right people. I was going to say that, but did not want to embarrass you. I am interested to see how this is going to turn out, particularly with the weather. Peyton manning can throw in 45 degrees. Who are you rooting for . I want to say the broncos. Mike is wearing the broncos orange. Enough toon was nice take us through all the surprising numbers attached to super bowl xlviii. Are you ready for some football . 110 Million People are. That is about how many people will tune in, almost as many as the entire population as mexico. Stadiumough to fill the 1333 times. The super bowl was first played 12,tickets costing just and fans were outraged they were so expensive. Now, the face value of premium seats as much as 2600 apiece. You will pay more on stub hub. On the field, not all quarterbacks are alike. Veteran Peyton Manning has the highest base salary in the league. Seattles second year quarterback is one of the lowest starters. 37yearold manning was drafted in the 1990s. Russell wilson was just nine years old. You want to come hungry. A record 1. 25 ilion buffalo wings are going to be eaten during the game. That is enough to stretch from century field to met like stadium 30 times. Stadium 30 times. A billion chicken wings. Pretty gross. He busiest days of the year for pizza delivery, i have heard. Houston mayor bill white houston hosted the super bowl while bill was in office. Also joining us is michael mckee. Let us start with you. The nfl is promising it is going to bring 600 million into the city. Break it down for us. Ask if you believe that, i have a bridge downtown i am going to sell you. The great quote i saw today there are all kinds of reasons to host a super bowl, but economists cannot find any of them. Publicity,ood for but monetary, the nfl is way off base, and will not tell you how they come up with that year. It is kind of pulled out of thin air. Tons of economists have studied all of the super bowls and found little to no economic benefit. You go back to houston and their super bowl in 2004, the nfl said it would generate over 300 Million Dollars worth of Economic Activity for the region. A prominent economist studied this and found that houstons tax revenue increased by 3 million. According to the comptrollers office, they spent 2. 1 million. The prophet was maybe 900,000. But there is prestige. Was it worth it . It is a great party. If you have not been to a super bowl weekend, i am not a party animal, but i was tempted, because of what goes on. People from all over the country get to show off your city, get to show off your town. You put more heads on beds. I am with you. I see these numbers where people claim these special events or stadiums result in billions, and all this. I am skeptical of those multipliers. But more people came to houston that weekend than would otherwise be there, and they bought a bunch of stuff. That may work in some cities. For the most part, the people coming in this place other people is this is conventions or things like that. It is tough to see a particular benefit. Betty went to indianapolis for the super bowl. Earlyas late january, february. Would you have otherwise gone to indianapolis . If the super bowl is in new york city, new york city does not need anything to attract people. The same thing is true in a florida city, or in phoenix. People are going to go there in winter anyway. It does not add to those economies. I find this interesting. One of the reasons why city governments go to the taxpayers, for instance metlife was paid for by private money. But they go to residence and say , fund our stadium with public money. We can attract events the super bowl. If it is only 900,000 to a city, dont taxpayers feel they have been look. With due respect, i think he was talking about tax revenues. I was in the hotel business. I know something about the hotel business, Houston Hotel business in january. We had a lot more occupancy on super bowl weekends, filling beds that otherwise would not have been filled, and they were buying food there. You i think sometimes people exaggerate those benefits . Yes. But i can say it was a plus. Is,ne of the problems there where are the Corporate Headquarters for those hotels . ,hat is where the money goes into the corporation coffers. Not necessarily helping local Small Business. That is one of the problems with these analyses. We have heard about individuals renting out mediocre studio apartments on air b b. What are you getting for years . Who would want to come to chelsea . How youant to ask manage these things from a Public Service standpoint. Helping a demand is this on Public Service . How policees about in new jersey had broken up a ring of drug traders and prostitutes. How big a demand is this on Public Services . Just to police the super bowl. Governor who has one of these things, does not want to be a big traffic jam. And you want to make sure that people by the way, they stay up pretty late after a super bowl sometimes. And that people are safe when they stay up. That imposes some it keeps you on your toes. At you want people to have good experience and enjoy being in your city. That is why cities across the country will compete for these events. Nobody will force them to. Event you wish houston would get that it has not yet . Like the summer olympics. Wouldnt that be great . I do not think we will be in contention for the winter olympics. If qatar can win the world cup, houston has a chance. I am just saying. The worlds biggest air conditioner would be needed, though. There you go. You may be bid for the olympics. We have been there. We will do it again. Chicago is one of the cities that was in the hunt while we were doing it. I love the olympics. That is a huge boom, actually. And i am actually going to sochi. I will tell you all about that. That is a whole other story. I want to switch now. No way. I want to go to sochi. Thank you for joining us. Bill is going to stay with us through the hour. We saw these pictures earlier. Terrible. At home depot, krogers, the supermarket, because they could not get home in the huge snowstorm. What could have been done to prevent this . He asked the former mayor what he would do. Bill white, former houston mayor is with us. The citytlanta brought to a standstill. It was chaos. There were kids sleeping in buses, people sleeping in home depot. My own parents got stuck in the atlanta airport, trying to make their way down to key west. It was terrible. They slipped at the airport and finally got out the following morning. I felt very badly for them. They were not alone. If you were mayor, was there anything you would have done differently . I have not gone through the timeline. We would have our by our timelines. To all the mayors out there, it is better to be safe than sorry. We would call for evacuations and we would close things early on, knowing that we could take criticisms, as we did on one occasion. The storm turned right very suddenly. Some of those traffic jams we just saw, some of those trucks apparently were stuck on the road for 20 hours. It just seems so astounding. You would think that cities have some sort of emergency plan. According to reports, the kids were let out of school with very short notice at the same time that private companies said, get out, the snow is coming. That created this huge jam. Can you blame that . Why was in the city more organized . Dont they have plans . Some of this is also the meteorology. Our what go our by atlanta did. I know that when it comes to tropical storms and hurricanes and the like, we have a pretty good idea of when we have to make each decision before it becomes too late to make that decision. That was one of the problems new orleans had in hurricane katrina. You did not want to be on the roads at the time the hurricane hit. I went through an experience and we had 200,000 people in my city after hurricane katrina. You invited them. We house to them and help them get on with their lives to live with dignity. Within six weeks, there was a category five hurricane they predicted would hit right at my city. Like i said, it turned right. All we wanted to make sure everybody was off the roads in case it did not turn and hit us. Expertsaid you became an on hurricanes because it was a threat to you. You think the mayor in atlanta is at fault for not studying the weather a little bit . It is hard to say, without going through i lived in atlanta five years. It was one big snowstorm when i was there. 19992004. It was chaos. Not as bad as this. We did see it snow in cairo this year. It is anybodys guess. A couple other cities are in the news. Detroit is going through bankruptcy. They are about to submit their plan. As they are going through the bankruptcy process, is the city i mean, is this city gone . How is it going to come back . Parableought to be a about what not to do for a city, a state, or a country. You should not borrow too much. You should not let your debt get so much greater than your. Apacity to repay you should not have unfunded pension liabilities. As mayor of houston in 2004, we reformed that. We get into trouble where you have to raise taxes to service old obligations, he cannot offer services to the people who are there, and people move back. Rahm emanuel is a friend of yours. What do you think chicago can do . Give local needs to governors the power to renegotiate pensions for new hires. Not to take away what has already been accrued, but what could be accrued in the future. I applaud mayor emmanuelle, for having High Performance charter schools, so there are alternatives. I bet he has boned up on snowstorms. I bet he has. We are going to have much more with the former houston mayor. Coming up, fixing traffic. Quakes we are here with former mayor of houston bill white. Breaking news coming out of the New York Times about Chris Christie and what he may or may not have known about lane closures. The former Port Authority official says the new jersey the closingw about of the George Washington bridge. He knew about it. He attempted to prove that. Afar, observed this from what do you think of this . Any public official anywhere in this country who hurts citizens in order to retaliate against a political opponent if they do that, wherever that would occur, that is wrong. Have you heard about political payback through traffic . I am serious. An odd avenue for retribution. It is odd. People ought to be miffed. This is the United States. This is not a third world country. We respect learn, if diversity, it means we respect the diversity of views. Just because somebody does not support you or i agree with you does not mean they are an enemy. It certainly does not mean that the citizens should be punished because of a political feud. If these allegations to prove to be true, do you think christine has any political future . Chris christie has any political future . I am not a republican primary participant. A lot of people like his candor. You are a democrat, we should point out. I am a democrat. That doesis something cross a little bit of a line. Advice i would give is, whatever the truth is, own up to it. If you are going to be in a president ial race, the truth will come out. Looking back on your three terms as mayor, is there anything you would do differently . Are there any regrets . I have been watching this guy in toronto. Mayor ford . We are all watching. I never knew the job could be that much fun. I never, ever considered saying stuff like, maybe i was too drunk out of my mind. Every day goes by where you wish ,ou were nicer to somebody where you were a little bit short. I would have liked to have more mass transit built. I fought for that. And you spent a lot of time on a bicycle. Look at that you are responsible for bringing the tour to houston. I am glad they used this photo. I said, do not use one of the photos where they get a good view of the bicycle shorts from the back. I think it is a good deal. But my Campaign Staff said it cuts you off. That must have been cropped. Joining you so much for us. I had a blast. The former houston mayor. Thank you. That does it for this edition of street smart. Click the dow down triple the jets for the fourth time in seven days. The dow down triple digits the fourth time in seven days. Cracks great way to end the week. Cracks time for the top 10. We are going to kick it off. 12 . Tock is up about biggest gain in the s p 500. Fourthquarter profit rose about 30 . More diners visiting the restaurants. Chipotle has been expanding. New concepts and catering services. That looks good. It does near dinnertime. Gaining almost 80 after the Company Reported fourthquarter earnings that beat estimates. The results were primarily driven by Strong Revenue in macau. Amazon shares are tumbling, down at least 10 , the most in two years, after the largest web retailer reported profits and sales that trail projections. Amazon says sales outside the u. S. Slowed, while Holiday Shipping costs surged. A lot of that is with amazon prime. That is amazing. Shipping for free. Google climbing nearly 4 . Fourth quarter revenue rose 11 , topping the estimates. Retailers spend more on advertising during the holidays, making up for lower at prices. Number six is zynga, surging 22 . The company known for casino style games is going to fire about 10 of its staff, austria headquarters. Of its staff, mostly at headquarters. Mattel is down 12 , plunging the most in almost five years, after a drop in sales. The biggest toymaker says global sales of rb fell 13 in the of barbie fell 13 , and hot wheels declined eight percent. Rv sales make sense to me. Why . Because there is so much competition. Because of american girls . Fax because america realized women do not actually look like that. But hot wheels is a concept i did not think this was a gender issue. Or a comment on bodies. I thought people were just buying video games. Exactly. But there are the bratz doll s. People have moved on from barbie. Not as thin dolls as barbie . I know they have big heads. Fourthquarter profit tumbled 32 for chevron. It is the latest International Energy producer to disclose production shortfalls and surging costs and unplanned project delays. Numeralrcard falling five percent after Fourth Quarter profit missed analyst estimates. Rebates to card issuers fueled an 11 jump in expenses during the quarter. Tyson up eight percent, rising the most since 2012, following a beat on First Quarter earnings, and a fitting from higher sales of chicken, beef, and pork. Will billion chicken wings be eaten on super bowl sunday. I am good for a couple dozen. I will have 4. I will have none. Trading flat. Fourthquarter profit will be at or below the low end of the previous forecast. Juan mark is among the retailers emerging from a Holiday Season arc by steep discounts that threatens to eat into profitability. The closing bell. Kevin of under armour with members of the executive team. That is also the Carolina Panthers were to back up their best quarterback up there. Town for them in super bowl. Be there, but to lindsay vonn is not going to be in sochi. If she recuperates, she will make the world cup. I just want to note that down 150 point that the dow on the dow. Painful. The worst january in four years for the markets. There is always that thing that so january goes so goes the markets. What really stuck out to me with the treasury market was the treasury market. That is the biggest monthly move since august of 2011, since they were downgraded. Seen this selloff in emergingmarket currencies that has picked up steam over the course of the week. At is the whole story. Lets write to sort this out, put a little contact with the panel of experts. David, i will go first to you, emerging markets taking center stage, argentina, indonesia, turkey, take your pick. Taking these stocks their cue from anxiety a broad . And started with how we started the year, we went in with the u. S. Stock market in up a lot. Stopped the upward momentum and the market got doubleteamed because we had the moving forward, and it cut the legs from underneath it. I do not change as the story of the u. S. Economy, and so i do regard this as a buying opportunity. Would you agree catherine . Certainly within the emerging markets, there are some opportunities to be had to mow when you have had asked strike. Right we see turkey, brazil, mexico columbia, and you can see some opportunity eventually. T couldute could rou continue over the next couple of weeks, but it will ring out the fundamental stronger stories. Mexico, korea, was that have done the right things, may the reforms, and are continually doing so. Lets focus on mexico as an example, what has mexico done that makes it stand out for you . You have the Energy Reform, mexico has already pushed through and past Energy Reform which will more than open up this otherwise completely unavailable to Foreign Investment area. Eighta growing story, and percent tied with the u. S. As mexico fundamentally pushing for fiscal reform, Energy Reform, these reforms have a longterm impact. For a longer term investor, you can certainly pick up some value in names that have been overly sold. David, let me bring you back into the conversation. Earlier this morning i had a chance to speak with the irish finance minister about michael minister, michael noonan. He was talking about how europe was coming back, ireland has back, and they want to have investors again. Have the deer really turned the corner here have they really turned the corner here . 2013 and has all been up. Things are getting better, but the Unemployment Rate is still 12 . The reason that that is an opportunity is that if europe can build momentum, it has some the dental per cyclical rebound potential or cyclical rebound. There is tremendous opportunity for european stocks. Marketshe euro merging in the long run, and europe for the short. Has had u. S. A great run since 2009, so you think you will get more bang for your buck . Economy, i think there is much more room for europe to as its normal trend without hitting invention problems inflation problems. They are lower than where they are the United States can and low relative to their own local bonds. They have more potential to grow over the next five years in terms of trend growth than the United States. How hard of a cell is that sell is that . Hang up the phone would you say go to europe . It doesnt work like that, but fundamentally i love talking about stories which are unpopular. The worst time to get into a market is what everybody says it is a good deal, and everybody feels very good about it. People need to buy when they feel uncomfortable, that is where the opportunity is. Techoking at some of the earnings that we have had over past week, facebook. Out stood out on the upside, but everywhere else you look, amazon , several is that we have seen that others that we have seen, yahoo for instance, it all points to is the number that we see being reflected in the earnings and revenue . I think youre seeing some disappointments, and i think a lot of that is reflected in equity markets. The s p has been dropping over the past couple of weeks. Going back to the emerging markets, it is important to everybody, does not matter if youre in u. S. Investing, or bonds. It is all about whether we are at are or are not entering crisis like 1997 or 1998. It all goes back to direct bottomline Earnings Growth for corporations. David . I want to add to that the earnings stories not that bad if you look at it altogether. So far, through this morning and we had 71 of Companies Beating estimates on earnings, and 60 of Companies Beating on revenues, and both of those are multiyear highs. Yearoveryear gain is huge, but even if you adjust it for some pension writeoffs a year ago, and some pension gains, we are still looking at about eight percent growth. The market is down, and therefore we have to find the usual suspects, and find something to blame, actually it has not been a bad earnings season. I want to get each of your thoughts on the fact that the fed seems to be forging ahead with the paper, without regards to the emerging markets. The central bank of india is concerned about that, why dont you answer to that . I think the emerging markets are going to be just fine if the fed continues with this gradual approach. If there is not a ramped up focus, because the concern is that emerging markets will see more capital outflows, which will destabilize countries like turkey that have only 13 of their current account covered by Foreign Investment. The rest is funded by debt and equity portfolio flows. If that reverses, you cad stabilization. If they stayed tied, i think this is a correction, and i do not think it is a downward spiral on a global scale. David . I think the real problem, i think the fed should continue to taper, but i think there is a need for major developed countrys intro banks Central Banks to get into currencies if this turns into much of a freefall. That will help the whole global economy. Thank you for joining us. Coming up, microsofts ceo search may be over. Who may be the number one man . In america we trust the adam explains in todays insight and action. W in amerco we trust, time for insight and action. Let me show you why i made that statement. Here we have america, your have everything else. Green versus red. The u. S. Dollar up 1. 5 , u. S. Treasuries up 3. 2 . You have made money by holding u. S. Dollars in u. S. Treasuries. As opposed to the msci world index, all of the world stock markets are down. Trust. Ica, we we have been talking about this for a good two months. Now the question becomes, if it is been working, so far this year and for the past month, can it keep going . There is the dollar index, you can see it going back over a year, and we are starting to turn the corner here command there was very little he a president to get back to where we were. He corner here, and there is a precedent to get back to where we were. You can see where we were back thatis corresponds gets you back to about two point five percent. As people continue to buy treasuries, they push the price down and the yield up. There is certainly precedent for this thing to go significantly higher. It has been working for sure, thank you so much. First, a new government study out on the proposed Keystone Pipeline hearing a herbal clearing a hurdle. The Environmental Impact would is exactly and this what the supporters wanted to see. Does it sealed the deal for the president to approve the pipeline . It does not hurt that process. If youre against this, if you whoa billionaire investor has plunked millions of dollars down trying to put a stop, this is a body blow. The state Department Officials are stressing this is not a done deal, this is another step in a process, that now continues with another review. We will have eight agencies eigginhing in. W if you are a supporter of this pipeline, this is a big deal and a big step forward. As you say, it is a particular blow to tom stier, who is good friends with secretary of state kerry. So this is the final announcement . Correct. Andl now be a 30 day there will now be a 30 day toeframe for the public respond. There is time here, so tom is not done. They are trying to liken this to the Third Quarter of a basketball game, not quite done yet. All of the focus is on the white house, and on the oval office, where they feel the best chances to put a halt to this. We are in an election year. For theally complicated president. The republicans, you can look at my inbox, i have about 700 press releases to republicans for all of the senate and the house and the political committees. They are going to hammer the president on this, and the problem the white house this has this year is that there are 22 democrats in the senate up for reelection. They need to hold onto one or two seats that are supposed to be lost. Harrynate majority leader reid, and others have to Pay Attention to the political base, but they have to also Pay Attention to the red sea to seats. Ts red coming up, there is a super rejecteory that will whether the market will close up or down reject whether the market will close up or down predict whether the market will close up or down. All right, so far in 2014 bonds are working, stocks are not. So which ones should you be buying . Bloombergs own. It is reallyll, remarkable the way that longterm treasuries are outpacing stocks by about two percent. To of the etf that people go is the ishares 20 plus treasury. This is your classic pay for your mother longterm investment. Six percent here today, but it has a duration of 17 years. If rates were derived, this would get killed, and that is why last year you solve people leaving this one, but now you see that rates are falling, so people are going into this. If you want to go even further out of theres the vanguard extended duration. 26. Has a duration of it becomes a 26 year zero coupon bond . Exactly. If you think rates are going to continue to fall, this will shoot up. It is a very volatile choice. Ix what about futures v futures . It trades about as much as microsoft. , even though traders love it is you cannot hold it for extended time because it is very difficult. 12 ofex was down about 13 last year, and the index was down about 60 . This is all because of the entanglement in the futures market. They do love it. For thisbout etfs super bowl theory about where the markets go depending on who wins . The theory says that if the nfc wins, the market will end the year up. Wins, afc west, the the market will end the year down. 05 , that is twice as cheap. It tracks a little better, and this . Why not go into if you think manning is going to win the game, you may want to go into the ranger barry pdf bea r etf. This is an interesting one, because it is actively shorting stocks. Last year he got crushed because the market rallied, but maybe the markets are changing. If youre thinking the whole year, those levers etfs are no good long longterm going longterm. This was up 18 when the market was down nine percent, but youre going to pay up active management fees. What about the guys who like buffalo wings . , if you have no opinion but if you think that people will eat a lot of food and rigoletto here, you can go with the powershares average. Companies, candy, it has everything in there. Midcap, so small it outpaces the staples for the past few years. Seattle. Ing for i feel like a lot of people are pulling for Peyton Manning. We will talk about it next week. Good reasons. The u. S. Military spending may be slowing down, but the earnings have raced ahead. Here are the top five. So cool. That was cool. If you want more rankings can go to bloomberg. Com ranx. Won a freey business ad during the super bowl. We will tell you why, coming up. Time now for our big story, microsoft. The Company Prepared to name insider Satya Nadella as a replacement for steve ballmer. He is is possible for the cloud and Enterprise Businesses thats responsible for the cloud and Enterprise Businesses. What goes on in the c suite and boardrooms. Let me start with you, lets take this approach. List, but was on the came out of nowhere as the top contender. Is he the one to change the company . Normally you would not think that an insider would be the one to change a company, but given the fact that the company has been so much about the Office System and windows, that bringing up somebody that has little allegiance to those tem couldthe sys be an opportunity for change. He is also a safe bet. He is running about a quarter of the revenue, and the majority of net profits of the company with the enterprise system. It is a safe that. He came in in 1992, well before the 95 change the 1995 change. Is this saying that the cloud, nothe windows, or xbox . The focus of the company, the server business, it has transformed. They have got off to a slow start relative to competitors, but he has gotten back on track with the cloud. Starting in 1992, he did a tour ofduty in the in the markets two were of duty in the tour of duty in the microsoft business division. He knows what he can do, we do not expect that he will selloff xbox business or detest the bing est the bingdiv business. We do not think the industry is less guided about this, because as excited isis about this because he is relatively unknown. They said he looks nerdy chic. Geek chic. I still say nerd. The fact is, we do not know this guy will do, lets get him announce, as he wouldve his hundred day plan is and that will tell all of us what he is really going to do. Microsoft is a very Different Company on the other ones that have been struggling to bring an outsider ceo. Microsoft has this strong inition in office and windows, and making theyre going to do to chase and company has to preserve that and build on that to create an advantage. Bringing in a complete outsider who does not understand the intricacies of that business would take an enormous amount of time and rampup to achieve the change. Were going to have to see what they do with the chairmanship. I think bill gates will stay for a time. Theyre going to replace the ceo and not the chairman . Absolutely. He foundedockholder, the committee, i think he should do that. When he was to lead, he will lead, and that is his decision, not the boards. Oni want to replay for you comment he made last week when he talked about his huge or plans at microsoft. My fulltime work will be with the foundation for the rest of my wife and i are enjoying that. For the rest of my life. My wife and i are enjoying that. I will help out parttime. If the gates were to step aside as chairman, he was still holds sway at this company. Absolutely. He is going to be a viable input to the technical direction of the company. We want him on the team, on your businesses onther the side. We have talked to our friends at microsoft when they all want him as the ceo. I think it is important that the insiders are really behind Satya Nadella as their favorite pick. Thank you for joining us. 400,000g up about people are coming to the big apple for the super bowl weekend. New york should be in the cycle every 10 years, because they have bought the assets on the new york and new jersey side. The excitement, and all of that. Afterward, we played football, at some of the best games in history of inflated medical that whether that have been played and implement weather. The super bowl is just two away, and they predict 100 million viewers, 400 thousand visitors, and nearly half 1 billion in profits for local businesses. Memberodell, committee them as well as ceo of modells goods. Goods sporting the Economic Impact is unequivocally real. We are starting to see it. Half 1 billion in one weekend . If you look at the history of what new york has been able to do and generate, have a billion . 5 billion is really . 5 billion is attainable. Predict out . Brineak it down . Hotels, modell sports . [laughter] what does this mean to you . The electricity in the city is nothing like i have ever seen. The dna of new york, when you see, when the players landed and started doing interviews, it was incredible. You know when you cannot move in the city, and it takes you a half hour to get to the next block, that is how it works. That is all the George Washington bridge. [laughter] the reason why i ask, is because we just had on the ormer u. S. Houston mayor, and he admitted that the super bowl did not generate as much revenue as the predict and predictions. Ofonly created a net benefit 900,000. Go to the restaurant, the bars, the hotels, times square is puzzling to me could tell by the sales. Bustling, you can tell by the sales. We got so much of this data earlier on about the hotels, and youve seen the markets s iting this up, and a gets closer to the game, the prices will go down. Presold beforeas those teams got in. What you have two west coast what, when you think about how me people live in new york about and how many people never experience the super bowl, you are just walking down the boulevard, and it is electrified. It is a festive atmosphere. Oni am going to be game sunday, but one of the things that i, as a new jersey resident, have not been looking forward to is the traffic. I have said to myself that i do not want to go through the city because i do not want to try to drive a toboggan. The parking is actually the biggest thing that they are having to deal with. On one hand it is good, and one is bad. Will feel really comfortable about going if they know about the security. Theres going to be no issues with this, and that is really important. I am leaving early, will be p. M. At 2 30 a. M. 2 30 for the gates opening at the tailgate parties. I will just enjoy the festivities. Event, when it was this stadium was built for this event, when it was originally conceived. I do not think, when you look at the end results from the data we have seen so far, it seems pretty interesting that were going to get these people. I want to. 1 thing out, this point one adam thing out, is this yours . Ticket sales started to drop, as soon as the weather changed, i had a lot of friends in the markets that all of the sudden could not get to a party, and every ticket was sold. It was a whole different ballgame. I got my gloves. Thank you mitch modell for being here. We appreciate all your done for the city. You have done for the city. Youre ready to go on the field, adam. Meet the winners of the super bowl challenge, next on street smart. Blocs,toymaker goldie this Small Business will have its 30 seconds of fame during footballs big game. Here is a sneak peak. Exciting. They won a free add as part of a national on test. Contest. It will appear during the Third Quarter of the super bowl, and we are now joined by the winner. Congratulations. Lets start with brad on this. Why did you decide to do this competition . We have been the champion for Small Businesses and consumers around the globe, and we want to change nobodys life opera badly they could not imagine going back. With tax software . We have it all. We sat down with some of the best thought leaders, and thought what has never been done before, and the answer was to imagine an ad for a Small Business owner in the biggest stage of the year. An ad that we would professionally produced and paid for. We opened it up to the world jobless vote, and most inspirational story is sitting right here. You started this company, which basically takes engineering toys for girls, because you said why are all of these toys out there for boys . There needs to be something for girls. Tell us about this. I studied engineering at stanford, there are very few women in the program. So i set out to reduce the gender gap in engineering, and get them while they are young. I noticed that the construction toys have been marketed to boys for a really long time. I felt that the girls were missing out, so our mission was to disrupt the pink ill come and get girls more options than just dolls and princesses. Talk us through here it is on set. What is in there when a little girl opens it up . After doing months of research, what i found was that world love stories and characters. Rather than building for the sake of building, they wanted to know why. And so what goldieblox is is stories about goldie the girl builder. She solves problems by building machines. The kids get to act along with goldie, and learn engineering for the bulls along the way engineering principles along the way. Brilliant. What was it about her company that really grabbed you . But would have picked her, it was not my decision, it was america. There were four finalist, and hes one of them has an ad each one of them has an ad that we will run in their local markets. What debbie has done was create a movement, about an opportunity that girls do not know would have existed. She has empowered an entire generation of girls to step up. Does your relationship continue after this . After the super bowl run, she has a tremendously powerful 15 Employee Company that is about to handle what we hope to be one of the greatest sources of demand that the company has ever had. What if you have a hundred thousand, 200,000,. 2 5 million orders . We have been prepping for weeks, and we are a small but mighty team. We are trying to make as many toys as we can. How long have you been prepping . We opened up a second factory, all ramped up our production, and are expanding gift1000 momandpop stores, and we Just Launched in target. Where did we get the financing . We were a kickstart a project about a year ago. Wow. Is there anything else land beyond what were going to see on sunday . Products, a lot of and our company is very committed to her success, so we have said we are going to write the right there with her for any help that her Company Needs to be successful. Great. Maybe we will see you again next year. We had a great amount of great ideas. We will all be watching. Morning. Monday thank you. See you monday. It is that you six minutes past the hour that means that Bloomberg Television is on the markets, i am mark crumpton. Lets get you caught up on wall streets activity. A rough and to the week, and to the month. Stocks ended the day sharply lower after disappointing amazon. From the dow industrial is down , closed atpoints 15,698. The nasdaq down nearly half a percent. 5 . For more on the markets, scott joins me from st. Louis. That slowing chinese economy and ,urther fed cut to stimulus some would be worried, but you say this is a good buying opportunity. Y echo why . I think that is what youre going to see this year as far as chinese gdp. I think there has been an exodus in the emerging market, not only the stock market, but the current use as well. Both of those things have been going on for at least a couple of years, so that is not new news. Youre seeing some acceleration of asset number does that have managers that have how around too long hung around too long. That is why we are positive, valuations are not stretched, people are underinvested in stocks, so i think youre going to see reasonable upside from here. The emerging markets index dropped 6. 7 this month. For people who are not regular market watchers, explain why this is causing so much turmoil around the globe. I think it is fear. The world has gone from a very type ofrest rate scenario to wear some of the Central Banks, like the u. S. , ghten up ang to ti little bit. We saw a ton of money flow into the markets, and now it is flowing out. , youou see some inflation do use more of your currency to buy things that are based in dollars, like food, or fuel. Higher inflation, slower economies, we rely on the rest we are very, so tied to what the rest of the world does, and that is why people fear what is going on over there. It is reflected in our stockmarket. There has not been a stock market drop like this in over two years. Your way overdue . Overdue . E have been looking for about a five percent or eight percent old back, so i think something down near 1700 is about where we are going to see the seventh asset the s p 500. We want them to leg in. Thank you. You. To talk to for on the markets, i am mark crumpton. This is taking stock for , 2014. January 31 today we are going to focus on out with the old, and in with the new. Bernankes last day as Federal Reserve chairman. It is the chinese new year, the year of the horse. Speak to the man who designed the u. S. Postal stamp that celebrates the location. Ok