Transcripts For CNBC Closing Bell 20140108

Quarter gdp. Also up today, a lineup of heavy hitters on the closing bell. We have exclusive interviews with paul jacobs rob sands. Have you seen what constellation stock is doing today . Jumping. And we have commerce secretary penny prits zer and john legere. We will get get the real story. He was escorted out of an at t story. He says he was there to see the musical act. He loves macklemore. Sure he does. Microsoft taking a hit today. Allen mullally is taking himself out of the running to fill the ceo role at microsoft. Microsoft announcing it will now be february at the earliest when they announce who is going to be the new ceo. Who are the likely candidates and who is wall street rooting for . We have an in depth look at that very important story coming up in a little while. Were keeping a close eye on market this is hour as we head towards as were into the final hour of trading with the dow down 82 points. Thats half of 1 . We have the nasdaq actually the outperformer today. Only down by a quarter of a percent. And the s p 500 is only off a couple points. So really the weakness centered in the blue chips today. Lets talk about todays action in our the closing bell exchange. Kathy jones is back with us. Peter anderson from Congress Asset management keith fitzgerald, and Steve Liesman and Rick Santelli are with us as well. Steve, im going to start with you. Whats the headline out of the fed minutes . How does the fed view the economy right now . Pretty upbeat and this was before some of the better and upbeat data we have gotten since the fed meeting which was december 18th. As you know, bill, weve been reporting for many weeks that the gdp forecast for the Fourth Quarter have really risen in that period of time to more like a second half of 3. 5 versus second half closer to 2 . So the fed views the economy as viewed it as good during the meeting. Its gotten better yet. So the question is whether or not that means a faster tapering. And what i see when i look at those minutes, i think the center of the board remains for a measured cautious approach. Look, if things really do accelerate i think the fed will accelerate tapering. Kathy, here is what i want to know. Weve got this better batch of Economic Data about the best jobs report you could hope for, the fed minutes which are more upbeat. Why isnt the tenyear yield decisively above 3 today . Well i think a lot of this was discounted. Weve been talking about tapering since last oh march or april, and we finally got the announcement. So this just confirms that the central part of the fed, the doves, the moderates, the hawks all got together and agreed on it. I think theres a lot of questions about the sustainability of some of the better economic numbers that we have. So even though the market has already discounted the fed tapering, i think theres a lot of questions Going Forward as to how fast its going to be and if you pull forward the expectation for actually tightening i dont think thats going to happen very soon. Lets ask Rick Santelli. You had the tenyear note auction. Demand wasnt spectacular. What is going on with the long end of the yield curve . I would think it would be the analogy that work is somebody that eats ten big macs and then orders a diet coke. Thats why i dont think its so important yet personally, but it will be important. Remember, even though weve touched 3 intraday numerous times, it doesnt even look like were going to get our third crack at a close with a 3 handle, and i think thats significant. You know in the end i think what needs to happen is the markets need to all start to get on the same page. When we start knocking about another 35 or 40 billion off prven purchases and we work off the notion the fed has taken so many treasuries and Mortgage Securities out of the marketplace through their Balance Sheet, that we will whittle that equation so some of the strong data points are going to get a lot more horsepower kicking up those rates. Keith fitzgerald what about you . You say you think the fed is tapering into weakness. What do you mean by that . I think the fed is an illusion. We dont have free market discovery right now. Certainly not when it comes to prices. Im with rick until we get serious about this tapering we have no way of knowing whether the Economic Data is for real. What bothers me inside the fed particularly from todays minutes is theres still a lot of group think. Theres discussion and all kinds of things. But the one that got my attention is theyre debating the efficiency of future tapering moves or future stimulus. That to me says theres no plan b and they havent got a clue what theyre doing. That bothers me. Peter anderson what do you make of the feds strategy at this point . Is it appropriate given the numbers were getting on the economy right now . Well i think it is and i couldnt really disagree more with some of your prior commentators there. I think the minutes that i read today have been some of the best minutes i have ever read frankly. I think theyre quite clear. I think there is still dissension, but its healthy segmentation among the fed members. So i think were not going to be on auto easy either. I think whats going to happen is theyre going to taper very slowly and maybe even elastically. I think theyre quite intelligent around sips tiffnd sensitive to the fact this is the first baby step and lets see how the market reacts. If it over reacts we can always reverse our position. We dont have this cast in stone. Theres a lot of flexibility built in there. While i agree that theres, you know, disagreement about where exactly we are in this economic cycle, i think we should take a little breather and say, i think the fed is on that same page and theyre going to factor that in in the next meeting. I want to make sure i understand your criticisms correctly, keith. Youre bothered by the fact there are different camps that are debating the efficacy of qe. It strikes me thats exactly what you want policymakers to do. The other thing you and rick are both saying that i dont get is you both dont believe that the market is a forward discounting mechanism, which is that the market right now the feds Balance Sheet is a forward discounting let me finish the thought. They are not discounting the idea that there will be future reductions in qe and thats not what were seeing in todays rates. Steve, do you see when the highs in the stock market were in 08 . How is that for a forward predicting mechanism . Im saying the market doesnt get it right all the time. Nobody who this is probably the second time in five years then. Well all im saying is that in general the idea that the market right now is not discounting future cuts strikes me as being the wrong way to think about what markets believe right now. Jump in keith. Anytime. I tell you what theyre not discounting forward thinking. What theyre doing is the certainty of risk. They dont want to let go of the fact that the fed may have it wrong. And traders, you got to remember, are not academics. Theyre responsible for trillions of dollars every day and they make it or they lose it every single day. They dont want to be on the wrong side of that trade quite literally, pardon the pun. So i think todays fed minutes point out, yes, theres dissession, yes, theres discussion thats great, but were saddled with whatever yellin comes up with like it or not because there is no actual open disagreement when the vote comes youre always saddled with what the fed came up when they set Interest Rates. No question but the fed doesnt set Interest Rates. The fed sets a target. The market sets Interest Rates. Dont forget that. Yeah but it curiously always set it exactly where the fed wanted it. No, we dont. The market takes it where it needs to go. Let me ask you this if i could add one thing, i think the fed also is looking i think the fed we cannot deny the fact that even though the fed will not say this publicly, they are looking at the markets, and i think once they make their statements they go right back to a monitor and see how the markets are reacting. It would be foolish theyre looking at a market like i would look at somebodys brain with a scalpel in my hand. Im with you, rick. How about the fact that theres a great deal of uncertainty you know we get one quarter of good Economic Data and everybody tries to extrapolate it five years into the future. When you look at those gdp numbers, for example, from Third Quarter, the real final sales were really quite soft and there was quite a big buildup in inventories. Even the trade numbers reflected weakness to a large extent in imports. Some of that is energy prices. We dont have a huge liftoff right now, and i think that that tempers some of the increase in rates that weve seen at the long end of the yield curve. I want to disagree with that since i disagree with almost everybody else on the panel, i might as well make it a strong sweep. We got two quarters of strong growth. You did 4. 1 in the Third Quarter. It looks like you will do somewhere close to 3 in the Fourth Quarter. That gives you 4 and 3 is what . 3. 5 average. If you summarize the economy what grade would you give it . B, b plus right now. Then why are we talking about emergency jobless claims benefits extended . I cant connect those dots either. Because you still have 1. 3 million americans, you have three people looking for every job thats available. You still have this they just want to pay these people off. I think its more of a human rights thing or a moral thing than it is an economic think as a reason for extending benefits. What weve gotten from the jobs numbers, the adp this morning within the last hour i reported nfib, best Small Business growth since february 06. I think you might be on the cusp of a change in the job market in america right now. Perhaps we might be but i also think that we will all agree that the picture is not that clear yet. And even the fed has said that. One of the confounding aspects that theyre frustrated about is the jobs picture and pricing power. They think the actions they have taken should be reflected in the market more strongly and theyre not. And i think its those issue that is cause this kind of spirited discussion thats helpful for the market to be forward looking and to price that into yields. Kathy, what kind of jobs number, what kind of payrolls growth figure on friday would it take to make the bond market sit up and think maybe this is for real . I think if we were well above 250 or Something Like that 275. I think the market has already discounted 200plus but, you know, then again adp isnt always a perfect predictor of the monthly jobs numbers and were going to have some odd weather effects this time or its a possibility we have some odd weather effects. In other words, 200,000 may not be good enough for the market . I think the market has discounted 200,000. You need 250 to 200,000 to stay up with growth. What youre talking about at 250, 275 is a rounding error. We need to see 300, 350, 400 jobs to know this is serious and we havent seen that yet. Thats getting ahead of ourselves. We need to see that consistently over time not just one shot deal. Labor force is different than it was in the late 90s. So 200,000 means more than it might have in the past. I want to agree with what kelly just said. Kelly, i agree with that. Wow. Lets stop now while were in agreement. That was fun, gang. Good conversation. Thank you so much. Have a good one. As we head toward the close, 50 minutes left in the trading session, we are down today. Maybe this is the kind of action we should have expected when you do get stronger Economic Data meaning the fed is going to have to taper a little more aggressively, meaning the bond market will see higher yields and prices are lower. The dow is down 86 points. I misspoke earlier when i said the nasdaq is down a quarter of 1 . It is actually higher. Were up eight points or 0. 2 . It may be bitter cold around the country, but we have the names of five stocks that have been cold in their own way. Maybe they will soon help to heat up your portfolio. Wearable technology has been one of the major themes at the Consumer Electronics show at las vegas especially for fitness. Qualcomms ceo tells us about his move into that space and just how profitable he thinks these products can be. And could a growing scandal for Chris Christie threaten his president ial hopes . Well get into that next. Keep it right here. Youre watching cnbc, first in business worldwide. [ male announcer ] the new new york is open. Open to innovation. Open to ambition. Open to bold ideas. Thats why new york has a new plan dozens of tax free zones all across the state. Move here, expand here, or start a new business here and pay no taxes for ten years. Were new york. If theres something that creates more jobs, and grows more businesses. Were open to it. Start a taxfree business at startupny. Com. Welcome back. You know qualcomm for its chip sets for mobile phones. This week at the Consumer Electronics show the companys focus seems to be less about chips. Lets head to ces where jon fortt is standing by the chairman and soon to be former ceo paul jacobs. Still ceo today. Paul, thanks for being with us. Tell me about that decision. We know microsoft was coming after your deputies and youre planning to do a lot more Technology Work as you hand over the ceo reins. I wanted to make sure we managed the transition had a great transition between steve to me i mean me to steve, sorry, and also i wanted to go focus in on a lot more technology. Its really my passion, kind of thinking about what the future is going to be working on the vision for the company, trying to drive the industry. As ceo theres a lot of daytoday stuff you have to do. I wanted also to make sure that the Management Team stayed together kept the band together, and were doing pretty well right now with this team. I think it was really important to keep steve here and driving this thing. Im expecting to hear more cowbell in the future from you guys. Lets talk about some of the things youre exhibiting here the future stuff youre going to be paying a lot more attention to. Technology you have for linking a lot of Different Things together. I want to ask about the business side of this. Intels new ceo says theres going to be an order of magnitude more devices but theyre going to be lower margin. Do you see it the same way . Is that going to impact your business that way . Theres huge volume so people are talking about 20 billion, 30 billion, 50 billion connected devices. Some of them are going to be a lot less expensive because you will sprinkle them all over the place but theres also high value ones too. We see a mixture of these and we will address the high end and the low end of the market. I think really its going to be about also making your device more capable because our idea of this digital sixth sense where you walk why your phone into the environment and the environment talks back to you and tells what you content and services. We have a smart home demonstration where theres an air conditioner thats connected and when i walk out of the room the air conditioner is on. It sends an alert to my talk smart watch and tells me did you mean to leave that on or do you want to turn that off and i can turn it off right from my watch. That kind of stuff. Yeah got you. Paul, hi, its kelly here. There are reports about some potential shortages for products like your talk watch that involves the chassis maybe impacting other players in the space. Can you talk a little bit about any constraints youre running into and what it tells you about demand for the talk watch and about other the ability for other makers to get into this space . So its not that big of an issue for us because we were always planning to make the talk a limited edition item. We werent going to build more than a few tens of thousands of them because we really wanted to show off a few technologies. Our display technology our Wireless Charging technology and then we also have some head sets that do stereo bluetooth with no wires. So, yeah, i think as people mr. These products sometimes there are shortages and theres new technologies that go into them. What you were talking about is the case some people were having issues with. For us its really not an issue. Lets talk cars a bit. Are you going to join the open Automotive Alliance . Youre talking about with yeah, we support an dried and you know how we are. Were verying a nos stick. We tried to be the switzerland of the stre. We already were the biggest guys in android right now. It makes sense for us to do that. Paul, this is bill. Youre not abandoning smartphones. We know that but lets face it thats your bread and butter. It has been will be for a long time. Give us a sense all this Wearable Technology that were hearing about at ces and that youre going to focus on as you step aside to think about the future of technology realistically how much of that Wearable Technology will contribute to your growth down the road . Oh i think its going to definitely contribute to the growth not just for the devices and the displays but it also drives new functionality in the phones. So these ideas of having sensors that are always on. We have these things now with phones that sit and listen so when you Say Something they turn on. But were also going to leave that on so it can sense if youre in the same room or the same car as your friend allow you to automatic link up either to the car or to each other, exchange content and things like that. So its going to drive new functionality. New radio interfaces, new software, new applications. Its a wholistic thicke stkistic thing. We say how do we build a whole ecosystem and work with partners like the air conditioner manufacturer. I get that. Its all very gee whiz kind of stuff. Im impressed, but the question is about growth and it depends on who is making those products and the adoption and the marketing. I mean are we setting ourselves up with all these High Expectations and we find out that you know i heard a survey today that 40 of American Homes still have vcrs and they dont have video game consoles. The Adoption Rate gets pretty slow when you get into the high end of technology here. Well thats one of the keys to make sure that we get these things cost reduced and very very simple for people to use. And by the way, if they have a smartphone, they probably have a game console now because the graphics quality in the smartphone is the quality of a game console. Were showing some stuff at the show thats amazing. Life like skin textures. All sorts of things you used to have to expect to buy something very high end. Now it will come in your smartphone. Its going to be about getting the cost down and making things simple for people to use unlike that vc r. Most people probably still have that flashing 12 00. With your phone it sets itself. Lets talk about that situation in the car. You guys partner with qnx. You had an announcement with blackberry. We talked about ed abouted about open Automotive Alliance. Will all of these things talk to each other . One of the things we did is all join alliance for is to have things like the car can talk to your phone. The phone can talk to your car. The car can say, here are the screens, the buttons, the microphones. Here is how you roll up the windows and unlock the doors. The phone can say this is paul and this is what he likes and here is his content and my friend gets in and theres his content and we can mix it up and do those kinds of things. Theres a lot of stuff to make all these Different Things work together. In our smart home that were showing right now, its all different manufacturers. They didnt have to work together. All they had to do was put this common layer in there is things can talk to each other. Weve been in automotive for a long time. There are over 12 million cars that have qualcomm radioed in them already. We Just Announced a new processor automotive grade. A snap dragon which means that stuff that goes in your smartphone, nice graphics smooth animation, thats all going to come to the user interface of your car and that will be exciting for people. Looks like you guys working on solving it. Thanks for joining us. Back to you guys. Thanks guys. Great stuff, jon. Weve got about 35 minutes left to go and the Dow Jones Industrial average is now off by 105 points at this hour. Its wayeighed down by weakness in verizon off almost 2 mcdonalds, chevron down almost 2 as well. The s p 500 is holding up a little bitter. Dwroo joo there goes yesterdays rally. Hes considered a president ial frontrunner for 2016 but theres a growing scandal for Chris Christie. Twitter was lighting up over the heated debate on closing bell yesterday. Take a listen. Im going to make you an open offer. Come and work at one of my companies for six months and nope. And i will fix you. Not going to happen. Hey, ill make you an offer. Come occupy wall street with me and i will fix you. Were trying to get that happen. We got a ton of tweets on that subject. Well reveal the cream of the crop later on the closing bell. Keep it right here. I always say be the man with the plan but with less energy, moodiness, and a low sex drive, i had to do something. I saw my doctor. A blood test showed it was low testosterone, not age. We talked about axiron the only underarm low t treatment that can restore t levels to normal in about two weeks in most men. Axiron is not for use in women or anyone younger than 18 or men with prostate or breast cancer. Women, especially those who are or who may become pregnant and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. Report these symptoms to your doctor. Tell your doctor about all medical conditions and medications. Serious side effects could include increased risk of prostate cancer, worsening prostate symptoms, decreased sperm count, ankle feet or body swelling, enlarged or painful breasts, problems breathing while sleeping and blood clots in the legs. Common side effects include skin redness or irritation where applied, increased red blood cell count headache, diarrhea, vomiting and increase in psa. Ask your doctor about axiron. Well another great thing about all this walking ive been doing is that its given me time to reflect on some of lifes biggest questions. Like, if you could save hundreds on Car Insurance by making one simple call, why wouldnt you make that call . See, the only thing i can think of is that you cant get any. Bars. Ah, thats better. Its a beautiful view. I wonder if i can see mt. Rushmore from here. Geico. Fifteen minutes could save you fifteen percent or more on Car Insurance. Welcome back. A mixed day on wall street. The dow failing to build on yesterdays rally. In fact, turning around decisively. Dom chu, what is going on in this market. All kind of stuff. Well begin with jcpenney. While they said they were pleased with its holiday sales performance, though it rattled investors not providing any details on those said sales. Other Department Stores also fell as shopper traffic said mall traffic fell nearly 15 . Forest labs is surging after they said they are buying a Specialty Company for 14 million in cash. Elliott management offered to buy the entire company for around 3 billion or 19 bucks a share in cash. River bed said it would thoroughly review the proposal. Mcdonalds fell after it was downgraded. All those stories, bill making some news in todays market. Back over to you. Dom, thanks very much. Well elsewhere in the political arena, a potential scandal surrounding a possible republican president ial candidate got bigger today. Eamon javers has the latest for us on new jersey governor Chris Christie. Thats right. The question is, is this a bridge too far for Chris Christie today . It has been a fairly lowlevel local scandal, but it blew up big time today when the bergen record in new jersey obtained some ex blowplo record in new jersey obtained some ex blowplosive email that is seemed to indicate that possibly Chris Christie aides deliberately caused a traffic backup on the new jersey side of the George Washington bridge in order to punish possibly a local mayor there, a democrat who did not endorse Chris Christie for governor back during the campaign. Take a look at some of these emails here and you get a sense of the tenor of what was going on behind the scenes. This one from christie aide. Time for some traffic problems in fort lee. His response got it. That was a couple weeks before the traffic problems started. After the fact we see this exchange. An unknown senders sends a text message, is it wrong that im smiling . Wildstein replyies no. One more text exchange. I feel badly about the kids i guess. This after some controversy over how many School Children were stuck in school buses for up to hours in ft. Lee, new jersey where the traffic had ground to a halt. Wildsteins response they are the children of buono voters referring to christies Democratic Political opponent there. The question here guys is this going to be a problem for Chris Christie Going Forward . Obviously a potential republican president ial nominee next time around. The question is how close will this get to christie himself . Will he be able to come up with some explanation for this series of emails . Hes going to have to do a lot of work very quickly to contain the damage. Because at this point if hes going to be involved in that president ial campaign, these negative ads are writing themselves. Yeah. Look, the real problem for a political candidate with a political scandal is when the scandal confirms a sort of character thats already been out there about that candidate, in this case the caricature is hes a bit of a bully, he plays rough, he has a big temper. This would confirm that if its all true and thats the problem for Chris Christie here is these kind of things take on a life of their own. Hell be known ased guy the guy who shut down traffic in bridge to punish an opponent. This is going to be very damaging for him if he cant come up with some explanations for it do something to caught rise the political damage quickly. The George Washington bridge we all cross it it is the most highly trafficked bridge in the world. There is some import there, but you wonder beyond that, anybody that lives outside what we call the tristate area here whether theyre going to care about this when it comes to it if he, in fact, does end up running for president. The question is how would gwb traffic issues play in iowa. Everybody around the country hates their commute. They hate traffic. They hate sitting in it and the idea that somebody would deliberately manipulate a traffic jam would really rankle a lot of commuters across the country. Its a tough issue because people can relate to it and they hate sitting in traffic. I do. And do i care that i got caught in that traffic jam . Maybe a little bit. It strikes close to home up there. You guys doesnt take much to clog up the George Washington bridge thats for sure. Thats also true. Close to home. Thanks. We have a selloff on wall street continuing. The dow down 100 points right now just off a low that was set a few minutes ago. So the definite bias here is to the downside for the major blue chips today. Its the tel cos taking it on the chin. A lot of companies are particularly underperforming. Thats why youre seeing that even as the s p is slightly negative and the nasdaq trying to stay positive. Not all stocks are lower though. Segue. Ceo rob sands will break down results coming up next. Youre welcome. If you think the picture on your television is really that good you havent seen anything yet. Well show you the latest ultra High Definition tvs being introduced at the Consumer Electronics show in vegas. This is one thing i miss about going to ces. You will not believe how clear these pictures are. You wont be able to see it on your tv, but you want to see the price tag as well when we come back. Aflac got em. Yeah hes clean, boss. Now listen to me, duck. I have an associate that met with, uh an unfortunate accident. While hes been incapacitated somebodys been paying him cash. Now is this your doing . Aflac . Now, if i met with some such accident would aflac pay me . Nice. This is your stop. [ male announcer ] find out what aflac can do for you and your family. Aflac . [ male announcer ]. At aflac. Com. Chuck vo theres a saying around here you stand behind what you say. Around here you dont make excuses. You make commitments. And when you cant live up to them, you own up and make it right. Some people think the kind of accountability that thrives on so many streets in this country has gone missing in the places where its needed most. But i know youll still find it when you know where to look. [ male announcer ] this is the story of the dusty basement at 1406 35th street the old dining table at 25th and hoffman. And the little room above the strip mall off roble avenue. This magic moment it is the story of where every great idea begins. And of those who believed they had the power to do more. Dell is honored to be part of some of the worlds great stories. That began much the same way ours did. In a little dorm room 2713. This magic moment so pretty clear now yesterdays rally in the dow failing to gain any traction today. 100point decline on the dow. Bob pisani whats going on . Its not looking very good on our fiveday indicator. Were down four of the last five days. Why does that matter . Its one of the mini indicators that have a little bit of a track record better than a lot of others. Its accurate somewhere around 70 of the time according to the Stock Traders almanac. The first month is a little better overall. The important thing is well get more data very quickly. All of this is going to go away. Earnings tomorrow with alcoa. A lot of traders believe theres going to be better guidance that washington out of the way, better u. S. Economic data better data in europe is going to cause them to be a little more optimistic in terms of the commentary, the ceo commentary. Im a little unsure about that because so far the indications are im not getting warm and Fuzzy Feelings about guidance for First Quarter from anybody. These stocks have been bid up so much into the earnings season, they have to meet that expectation. They had a good run up overall. Thats my main concern. Juf you have to imagine though that if a big portion of the rally we have seen in the markets the last few years was a result of the feds easy money policy, the minute they Start Talking about removing some of that easy money for the market whats the market going to do . But, remember the bulls main argument is it can withstand gentle raise in rates providing the Economic Data keeps progressively Getting Better. So far the bulls have been right on that. Theres been no explosion in the tenyear not an explosion, a move up. Theres been Economic Movement on the Positive Side and so far that scenario is playing out. Were still not getting the top line growth and the hope is by the middle of 2014 well go from 2 topline growth which is what we had in 2013 to 4 to 5 . If we can pull that off, the stock market is definitely going to be higher in the middle of the year but if we cant, if we cant get that kind of growth on the top line its going to be a little tougher. Thank you bob. See you later, bob. Consolation brands is seeing a big pop. Check this chart out. Theyre up more than 9 following the earnings beat thanks in large part to better beer sales. Straight to the man behind the numbers. An exclusive interview with rob sands. Welcome back again. Thanks, bill. Some Timely Acquisitions of corona and some of the other mexican beers there. That was a big contributor to this, wasnt it . Well yeah. We had particularly good beer sales this quarter. Our depletions which are our sales from wholesale to retail were up over 10 , and the Grocery Store channel is measured by iri. We had also terrific results, up 20 . Why . Why do you think . Well we think that its a number of factors. Number one, we think its all about the consumer. The consumer has really gotten behind these beer brands. Modelo. One of the things that differentiates us from our competition is weve had a very clear message about what our brands are all about. For as long as i can remember and this has really resonated with the consumers over time. Very strong brand health. And its interesting at a time when so many brands are struggling to keep customers because of attrition to microbrews, for example, or citer or somecite er cider, thats why i was surprised to see the strength in whats kind of a mature business. Youre saying theres a cultural resonance with some of the newer brands. Like a cultural resonance with those brands but also when you really look at the beer market, okay the whole better beer market in general is performing very well and thats the import segment and the craft segment, and the craft segment is actually a very small portion of the Beer Industry about an 8 share. Whereas our business alone is as big as the entire craft segment. But that said the consumer is really grafer gravitating toward Premium Products and our portfolio has been a beneficiary of that. I wonder when you look ahead to 2014 what youre going to do with pricing as a result. You know weve been pretty judicious as it comes to pricing. Weve been pricing below the market in general which has been pricing about 3 a year. Weve been pricing somewhat less than that and, you know, we take a very strategic view towards pricing. We look at it market by market brand by brand, and we make decisions based on whats going on with the competition and with the brands themselves. So it remains to be seen what well do with pricing. How is the wine market right now . Wine market remains very strong. You know, as a Consumer Staples category, wine is probably the fastest major Fastest Growing major category in Consumer Staples. Certainly one of the most important to retail and grocery today. Growing midsingle digits. So a very robust market the wine business right now. I heard that spirits were really kind of catching fire again, that that had caught the imagination of the drinking public again. No . Yeah, spirits are also growing well. If you look at the categories, all the growth right now across beverage alcohol is in wine spirits, and better beers. So really beers that are selling at prices above the premium demows tickde domestic beers. Thats where all the growth is in the category. What else is there . Exactly. Domestic beer. True true. Good point. Which is a very large part of the business. No it is. I just wonder finally if we see something if we see a nature of a rebound in Commodity Prices for example this year are you guys modeling that . How much of an increase do you think we will see and what impact could that have . Were not expecting to see any material increases in the commodities that are important to us across our businesses. So we expect to have very stable costs going into this year. Do you hedge . We do do some commodity hedging, but even that aside we expect to see very stable Commodity Prices. For our products in wine beer and spirits. Rob, good to see you again. Thanks very much for being here. Cheers, as they say. Thanks. Im concerned about how much were all drinking. Really . Well hes right, maybe its the domestic that are taking share. We have about 15 minutes left to go into the close. The dow is off the lows of the session where it was down triple digits but its still off 90 points at this hour. Ironically art cashin keeps coming by and saying the bias is to the buy side but were not seeing so far. From worst to first, we have the names of three stocks that underperformed in 2013 but are already starting to heat up this new year. Also fords Ceo Alan Mulally taking himself out of the running to be microsofts next chief. Find ut who isout who is up for the job. Well be right back. If youre living with moderate to severe crohns disease, and it feels like your life revolves around your symptoms, ask your gastroenterologist about humira adalimumab. Humira has been proven to work for adults who have tried other medications but still experience the symptoms of moderate to severe crohns disease. In clinical studies, the majority of patients on humira saw significant symptom relief and many achieved remission. Humira can lower your ability to fight infections, including tuberculosis. Serious, sometimes fatal events, such as infections, lymphoma or other types of cancer have happened. Blood, liver and nervous system problems, serious allergic reactions and new or worsening Heart Failure have occurred. Before starting humira, your doctor should test you for tb. Ask your doctor if you live in or have been to a region where certain fungal infections are common. Tell your doctor if you have had tb, hepatitis b, are prone to infections, or have symptoms such as fever, fatigue, cough, or sores. You should not start humira if you have any kind of infection. Ask your gastroenterologist about humira today. Remission is possible. Welcome back. How is everything . Theres nothing like being your own boss and my customers are really liking your flat rate shipping. Fedex one rate. Really makes my life easier. Maybe a promotion is in order. Good news. I got a new title. And a raise . Management couldnt make that happen. [ male announcer ] introducing fedex one rate. Simple, flat rate shipping with the reliability of fedex. I dont have to tell you, much of the nation still trying to thaw out from the socalled polar vortex which just means its really cold outside. In the meantime there are stocks that have also been in their own version of a polar vortex or ice cold for a while. Sheila has three names that may now be heating up. I have a space heater right here that is keeping me warm but i have three names for you that are heating up and im going to tell you why. So first up is teradata. It was down a whopping 27 last year. Just in the past 30 days its up 10 . What gives . Analysts i spoke to said this company has a very premium product. The average bill is about 1 million. Thats just a price tag that companies werent willing to pay last year. They didnt want to spend the bucks. As a result the company missed their earnings. Now, the economic recovery does seem to be taking hold. Companies are more confident, budgets are if place. Perhaps we are seeing a bit of a turn around. Analysts tell me this company is still a show me story. The second one is a retailer thats five below. This is a dollar store kind of retailer. Fun kitschy things for the tween and teen group. Had a pretty good 2013. Look at the stock after its last earnings report. The company completely tanked because of late guidance. Now we are starting to see an uptick again. What gives . Analysts i spoke to said this company is notorious for giving low guidance. He thinks holiday sales have been tracking pretty well. Rainbow looms is one of the reasons. Perhaps a really good turnaround story here. Big picture, company only has about 200 stores in its base. Looking to expand to 2,000. Finally theres a stock that we love to talk all about and that is blackberry. Terrible year last year. Has been upticking up a little bit and, of course two words for you, ceo john chen. Everyone pegging that turn around on him, what he can do with the company. I have to point out even if this company does come back its still going to be a very different blackberry than what we used to know. It will be a fraction of its size. Its a matter of if it can keep going. Just as long as they keep it going. Keep my blackberries running, thats all i care about. I dont care what size it is. I have one. We all do. Not anymore but i want to see what happens with their lawsuit against typo. Thats a big one. Thanks sheila. Art cashin just came by. Theres a billion dollars to buy. Thats big right now. Lets see if that has an impact as we head towards the close. The dow is coming back. Were down just 65 points at this point. And john legere crashing at t party and then getting kicked out. Hell join us in a bit to discuss what some are calling a brilliant publicity move. Well be right back. [ female announcer ] who are we . We are the thinkers. The job jugglers. The up allnighters. And the ones who turn ideas into action. Weve made our passions our lifes work. We strive for the moments where we can say, i did it we are entrepreneurs who started it all. With a signature. Legalzoom has helped start over 1 million businesses, turning dreamers into business owners. And were here to help start yours. Welcome back. About eight minutes seven minutes left in the trading session. The dow is coming back. Art cashin informing us there was a billion dollars to buy toward the close. Thats a lot. Joining me right now is jeff from Fifth Third Bank and matt chesslock from virtue financial. What do you make of the first five days of the trading year here . This is the opportunity people have been waiting for. Its been very shallow but there is a pull back. If you were looking for value at the end of last year you have been rewarded so far this year. If you were playing the winners from 2013 obviously you havent benefited as much this year. Jeff last year earnings and fundamentals didnt matter as much as quantitative easing by the Federal Reserve. You think though this market is going to be show me right now. Absolutely. Were no longer have a valuation driven appreciation. Its got to be earnings Going Forward. I think todays fed minutes reinforce that with concerns about valuation. So its all about earnings Going Forward. But bond yields havent gone up as much as you might imagine. If the fed is going to be tapering, that would be something that would keep people from going to the stock market, wouldnt it . You know youd think, but theres plenty of cash on the sidelines that weve seen. Weve also seen the employment numbers increase. So people are feeling a little bit more buoyant about this market. Maybe theyre going to take this opportunity to reenter this thing slowly. I think there is a backstop to the market thats not government related finally, and i think thats good to see. Get them out of the picture, get the consumer back into it. Get people back into equities and maybe homes. We see home prices increase. These are good things for the market. Are you hopeful for this earnings season . We are hopeful. But i do think theres a difference now when you look at todays fed minutes, theres a concept that the fed has introduced of concern over valuation at least in select small cap stocks. This tells me maybe were put away from a bernanke put to being short a yellen call. For those who are not as attuned to the Options Market i know the difference between a put and selling a call. What are you trying to call . We had a floor under us because we had the fed that was the bernanke put. If we have a Federal Reserve thats expressed concern about valuation, that means if valuations get too rich the fed might take the punch bowl away faster. That tells me again reinforces its all about earnings Going Forward. I got it. Good to see you, guys. Thank you. Well head toward the close here. Come back with the closing countdown for this wednesday. After the bell, when it comes to greek yogurt cho ban ni my daughter tells me is the king. That the company is now facing a backlash from loyal customers after shrinking its product by 12 . Plus you get kicked out of the Whole Foods Market because of genetically modified ingredients so the companys founder and ceo reacts to that coming up on the closing bell. Youre watching cnbc first in business worldwide. Yes one Phillips Colon Health probiotic cap each day helps defend against these digestive issues. With three strains of good bacteria. [ Phillips Lady ] live the regular life. Phillips. So ally bank has a raise your rate cd that wont trap me in a rate. Thats correct. Cause im really nervous about getting trapped. Whys that . Uh, mark . Go get help i have my reasons. Look, you dont have to feel trapped with our raise your rate cd. If our rate on this cd goes up, yours can too. Oh that sounds nice. Dont feel trapped with the ally raise your rate cd. Ally bank. Your money needs an ally. Mine was earned orbiting the moon in 1971. Afghanistan, in 2009. On the u. S. S. Saratoga in 1982. [ male announcer ] once its earned, usaa Auto Insurance is often handed down from generation to generation. Because it offers a superior level of protection. And because usaas commitment to serve current and former military members and their families is without equal. Begin your legacy. Get an Auto Insurance quote. Usaa. We know what it means to serve. [ male announcer ] what if a Small Company became big business overnight . Like, really big. Then expanded . Or their new product tanked . Or not . What if they embrace new technology instead . Imagine a companys future with the future of trading. Company profile. A Research Tool on thinkorswim. From td ameritrade. 90 seconds left. Kind of a mysterious kind of day. We had good Economic Data the adp jobs number was better than expected, 238,000. The dow down 80 points though. We were down more than 100 points for a time. So were coming off that. And the 10year note auction came out sort of anemic. First time since 2011 that the yield was above 3 . Were holding at the 3 level. Warren myers, shouldnt bond yields be going up if the economy is getting stronger and shouldnt the stock market perhaps be going up at the same time . One would think that. I think what youre finding out though is that even though the fed and everyone thinks is saying that the economy is Getting Better its improving marginally. I think because its not super strong, thats why the bond yields didnt shoot up as much as one might think. What are you expecting on the jobs number on friday . I think youre looking right around that 200,000. It better be right . It better be. If its 190,000 and lower, thats going to be a bad number. Earnings start tomorrow. What are your expectations . I think they will be probably 70 , 75 beat like they have been but i think the lower expectations will continue to come out. You dont sound too upbeat. I think were due for a little bit of pull back but im still positive. Thanks warren. Always good to see you. Down 76 as we head towards the close. We give back what we gained yesterday. Thats how it works in this market and earnings start tomorrow. Stay tuned for the second hour of the closing bell with kelly evans and company. Welcome to the closing bell at this hour. Here is how were finishing the day on wall street. It was much worse for the dow. Take a look at the screen. We have the dow off about 70 points. Thats not as bad as a triple digit losses we saw earlier last hour. Still sharply negative after yesterday. That makes it three out of four down days. The nasdaq is up 12 points. The s p 500 closing down a half a percent. Were pleased to have eunice yoon here from beijing. Also with us stephanie link mandy drury, and nathan backrack. Great to see all of you. Stephanie link what is going on with the dow today . Well i thought the data today was actually pretty good right . I think everybody was saying the data was pretty good and if you in addition to not only the adp number and the construction figure which was the best number we have seen in quite some years, you have had good ism employment numbers. The expectations for friday is that its going to be a good number and well see what happens. The Economic Data in the u. S. Is Getting Better. I think honestly kelly, we just have to get to earnings and listen to what companies have to say. Well get a little bit of a read tomorrow from alcoa. I will listen more carefully to what they say versus how the stock reacts because they have very important end markets Like Aerospace and auto and that kind of thing. So lets listen. Lets get to earnings. Lets hear what the companies have to say before we panic about selling off and taking profits. A lot of industrial parts of the economy that are looking a little better. So what do you think . We come into 2014 and we start with its a little bit down. What happens now . I think well continue to fid a headwind which is going to be what will moderate wall street for a good deal of time and the headwind will be Interest Rates. I think what we saw today was we got back to that magical 3 number, and at that point everybody goes gosh that means im going to have to actually pay something for money when i borrow it. I wonder what thats going to do to my bottom line. Stephanie is absolutely correct, youre both right, we have to get to earning season and realize we can actually have higher Interest Rates and the economy will still grow and well probably still sell houses and people will still buy cars because theyre 11 1 2 years old. Mandy, weve got in the early Earnings Results at least or the ones that are coming out before things officially get under way constellations brands was pretty good today. Were seeing for the most part theyre clearing the bar, albeit a bar thats been set pretty low. This certainly isnt the first time this has happened. How many other Earnings Seasons have we seen where the bar is set so low. I think stephanie is absolutely right. We need to watch what people say when it comes to the guidance in the earnings season but also we need Revenue Growth because obviously its easy to get its easy to cost cut and trim away all the excess and, you know, create the appearance of profitability. At the end of the day we need to see Revenue Growth come through in 2014. And watching out of the corner of my eye, it looks like macys is laying off more workers. It looks like the job picture is there, but again the most important or the most useful thing really at this juncture would be even if it means a corporate Profit Margins come down a bit, its because theyre giving more of that pie to workers because the economy is better and workers are able to have some power actually. Thats what makes the Economic Data that much more important. If we get better Economic Data not just manufacturing or jobs it has to be the whole gamut, it has to be autos, the consumer, if we get Business Confidence as well, you will get that top line number and thats what well be listening for. I hope the market takes good news as good news. Come this friday when we get the payrolls number and after the good adp number, were starting to see the estimates go up above 200,000. I hope the market takes it well. Remember in the past good news would be bad news for the market. And this would be a sign we have entered a different period. Im going to jump in. Please do. Set us straight here. What was really interesting is i think say in the emerging markets people are going to be very excited about what theyre hearing because there has been a lot of discussion about tapering. Is this going to be something thats disruptive to the emerging markets. Now people recently have been focused more on the pois that maybe this actually means that the economy is recovering. Thats a really good thing to hear from especially in a place like china where the economy is so dependent on the recovery of the United States. Mandy brought up this point. As people are looking for growth, raem growth and not just something thats in a manufacture earnings per share growth, theyre looking to jor overseas market. We have all of these different forces where it seems every day were reading about some of the Tech Companies worried about the nsa spying stuff. Even the revlons and loreals pulling out of that market. Is this going to be the source of growth that people that its been cracked up to be . Again, depends really on which sector youre in but i wanted to point out one of the things you were talking about with the nsa. There was a lot of discussion about this because of apple, a lot of questions about whether or not the association between the possible link between nsa and kind of like the ability to kind of tap into your iphone would really be something that would spook a lot of chinese consumers. Well what i always find interesting is in america americans are really worried about the idea of the government actually listening on their phone calls. Whereas in china, its assumed that the government is actually listening on your phone calls. So actually in china theres a joke that the government authorities really like the iphone because it is the only phone that you cannot take the battery out and if you want to actually stop people from listening on your phone calls, you have to be able to pull the battery out and put it hold that thought because dominick, i mentioned macys. We have a fuller market flash. Thats right. So what we have with macys here is an announcement from the company that they will be laying off about 2500 people. Thats part of an overall organizational change that theyre trying to implement. These changes are meant to help save the company about 100 million per year. Again, cost savings of around 100 million per year is what theyre targeting. So these layoffs, other organizational changes will be a part of the macys story going into 2014. Back over to you. All right. Dom, some interesting news here from macys. Stephanie, thoughts here on this one . Yeah. We own this stock and its acted horribly over the last couple days because everybody is concerned about the holiday sales and the foot traffic and how weak its been. Thats no secret. I think thats going to be obviously a very important theme when the company reports. That will be somewhat offset by the internet. This company they totally get it. Theyre at the forefront thats what i dont understand. Macy macy macys was supposed to be the winner. I got to tell you, im sure you had me on today because macys is right here in cincinnati. But what macys does know is they saw 15 less foot traffic and they got a lot of square tootsies when you take a look at those malls. They got 3 more sales out of those shoppers but they got a lot of overhead and internet is still only 10 . So while they get it in the short term theyre also going to be getting it and feeling it in the bottom line. But if theyre the ones that are getting it and theyre laying off staff, stephanie, what other retailers are going to follow in their footsteps . I think all the Department Stores. Look at jcpenney today. That was an absolute disaster. I think the off price retailers, the tjx, the ross stores are very well positioned. They entered the Holiday Season with lean inventory. They will buy all that inventory and sell it at a discount. Tjx is one of the best run companies. Macys are doing the right thing. Theyre doing what they need to do to produce the Bottom Line Results and theyve done a great job. Thats why the stock even the rally that its seeing recently its still underperformed the group. If you wanted to own a department store, that would be the one you want to own. Tim seymour is jumping into this conversation right now as well from fast money. Thanks so much. Weve got a couple Different Things going on. I dont know what direction you want to take us. What jumps out to you about this market today . Well first of all, the fed, its nice that the fed is actually almost a side show at this point. Pointing out the marginal efficacy of their strategy is something a lot of us have felt for some time. Getting back to retail i think you have to go valuationwise and stephanie makes great points about what macys has done in terms of the Management Team. If you look at the valuation of the s p Consumer Sector macys is a name i think still has a lot of room to go. Its trading 16 17 times. Thats value territory for a sector that i think a lot of hedge funds, a lot of guys im talking to believe that prices are very expensive here. Thats to me the story of this market. I think people are truly rotating. Theyre finding places where there is real value but there is a real structural change going on with management. Thats interesting, tim. The argument is theres still value in macys. I wonder if after hearing what they have to say about the consumer and the retail season do you turn elsewhere and think about places you want to stay away from or call into question the macro pike tour at all. Numbers we got in the last couple weeks on Consumer Spending and consumption, while on some level that scares people that want to talk about the redux of the housing bubble to me that is actually very positive. It gets back into the job growth, which then leads to telling you i think corporations are the ones that will be the surprise in 2014 on their spending. That will also support this market. Nathan, quick word . Kelly, this market is trading at 14. 5 forward earnings. We get any revenue at all, well be throwing confetti out again before new years because were going to find theres still room to grow if we get revenue. Thats a big if though and well get into more of this coming up. Everyone stays with me. Thank you so much, tim. Well get let you go. Theres a special fast money coming up. Weve been on tv for seven years, so its our sevenyear anniversary. Congratulations. Thats longer than the brady bunch. Longer than jersey shore and pauly shore. Its an amazing thing. The exciting thing about tonights show we have seven a s a lucky number and con tates the seven deadly sins. We have a lot of trades tonight. Well give you the seven lucky plays coming up and the seven lucky stocks we like for 2014 and, of course, the seven deadly sins. Which places are people hanging on too long and where they need to be very careful. Thank you so much and congrats. Microsoft shares were pretty weak. Well go live to Silicon Valley for an update on the companys search for a ceo. And also here what top microsoft analysts are saying about the tech giant and if now is the time to make it a musthave in your portfolio. Also john legere giving us his firsthand account about date crashing getting kicked out of at t at ts Consumer Electronics party in vegas. Is that exactly what he hoped would happen . That plus all the headlines out of ces. Youre watching cnbc, first in business worldwide. Aflac got em. Yeah hes clean, boss. Now listen to me, duck. I have an associate that met with, uh an unfortunate accident. While hes been incapacitated somebodys been paying him cash. Now is this your doing . Aflac . Now, if i met with some such accident would aflac pay me . Nice. This is your stop. [ male announcer ] find out what aflac can do for you and your family. Aflac . [ male announcer ]. At aflac. Com. Welcome bark. Microsoft shares hitting a rough patch after Alan Mullally ending months of speculation that he was considering the ceo spot. Mullally saying hes not leaving ford. Josh lipton the short list getting a little bit shorter. Mullally says hes out. The question now is who is in . Theres a list of obviously contenders one would be stephen elop. His fans say he knows mobile and microsoft culture. When he was at nokia, that stock nose dived 60 . Other contenders nadella, the kevin turner the coo. And finally one dark horse outsider that people talk to me about would be paulm ari maritz. He has a deep Background Experience with the cloud. So a deep tech veteran there. All possible contenders. Stay right there. Want to get some thoughts on the panel from this. Stephanie, who would be at the top of your list . Well the head of cloud internally is whats kind of the heavy favored from what i hear but the point is that i dont even think that mullally was the right fit to begin with. Yes, hes an amazing leader and hes done a great job at ford and im glad hes at ford and i think ford is a buy off this especially since its underperformed gm by 20 since the announcement has been made. But getting back to microsoft, the key is really going to be whoever gets in its going to take time to establish the strategy, to figure out are they doing consumer are they doing enterprise . What are they going to do. I think thats going i think the stock trades in a range. I dont think youre going to get 40 . What do you think of a microsoft here . I wonder if this all isnt taking too much time. They have got to act fast aggressively perhaps to kind of catch a bead on their rivals. Is the ceo search becoming too distracting . I think the first thing they have to do is decide whether or not they can use this monopoly they have had for a million years. We call them a ewe till because they just lumber along and make some money and theres nothing exciting about them. I think as i take a look at the xbox and look at where you now see netflix starting to produce content, i think its not going to be too long before in my opinion the next ceo might be the head of nbc right now because they need content. Maybe bill gates instead of selling 80 million shares a year ought to take some of that money and go out and buy himself a network or something to give to microsoft then at a point in the future when they figure out what device it will be they will be better off. The xbox will get you a lot of gamesters, thats great but baby boomers my understanding is that Division Still loses money. Its an important device its a toehold for them but theres a lot more to the story. But at the end of the day with xbox, microsoft is fighting for the domination of your living room. Theres some interesting headlines but new projects going on. They are getting into the streaming zone the docu drama. And there was the news earlier this week and eunice you can speak to this more now china has lifted that 14year ban on the sale of game consoles by Foreign Companies or made by Foreign Companies. So thats going to open up a whole new market to the likes of xbox. But for how long eunice . Any clue . Its difficult to say because there are so many restrictions that have been put on these game console makers that would want to come in. You have to produce in china at this shanghai free trade zone. Also there would still be a lot of restrictions and subject to the titles the titles would be subject to censorship. Currently the game console the gaming industry in china is worth 14 billion which is pretty much on par with the United States you get so much for free. I dont know if its legal, but cant you already get so many games for free . Here is the best example but another problem for microsoft in china is that you could get so many its like all the software all the Software Systems i could go into too many stores and actually just by the system for like 5. Nathan . The best thing you can say about why it is that you might not want to buy microsoft is when netflix came out with their first piece of content, it was house of cards. You can sit for 12 hours. Microsoft, the first thing, a documentary on atari. Let me see. Are you kidding . Are you kidding me . Just testing the waters. I think stephanies point about cloud is important here because if you look at amazon the way that company has reinvented itself and to some extent spurred an entire wave of northwesterlial ak entrepreneurial activity, thats going to be a 10 billion business in a couple years. Does that make perhaps the cloud choice for important. I think to stephanies point theres a lot of people talking about him. I think folks who criticize that choice would point out thats not the part of microsofts business thats challenged. Where theyre challenged consumer and mobile. Would nadella be able to address those challenges . I think theres a broader point when it comes to mullally. Even if you believe he wasnt the right fit, i think there were a lot of investors, analysts i talked to who just liked this idea of an outsider because they think, kelly, its only an outsider who can come in, shake up that culture, and maybe attack what some call the sacred cows bring and xbox. I dont think theres any doubt if they choose nardelli or anybody internally that the stock falls. But this person has very good experience. He ran the online business. So he knows the company pretty well. And i think they want to keep i think gates wants to keep the company intact. I dont think that he wants to split it up. You dont see a breakup they finally spinning off they finally briefly. No. They finally got the commercials right. Now theyve actually got some really cool commercials and all the stuff will fit together. Hey, why theyre almost like apple. How about that . Thats what happens when a campaign hand gets hired for an advertising shot for the company side as well. Thanks very much. Josh fascinating stuff. Well have to keep our ear to the ground and see what happens coming up. Speaking of tech another hot high tem at the Consumer Electronics show are the ultra High Definition tvs. They offer four times the resolution of regular flat screens. Half a million of them will hit shelves in the u. S. This year. Senior editor peter kafka joins us live. Cnbc has a content sharing partnership with ricoh. Great to have you here. 4k, were hearing a lot of excitement about it. Is this tv something thats ready for consumers and are they really going to respond especially given the high price tags . Well theyre ready for consumers. You could put one in your house right now. The question is what would you watch on it . The answer is not very much yet. So the question is if they sell more of these things will more content be available . And so start us off. Along the line of progression, first its like the big fancy multithousand dollar screens, but at what point does that really tip and start to become something where i as the consumer am eager and feel like its time and something i want to upgrade . If youre optimistic about this stuff, you say these things were tens of thousands of dollars last year now theyre in the single digit thousands. You can buy a very small 4k monster for 700 bucks today. If you look out two or three years, they should be affordable at least for someone who has a little bit of money to spend. I think what you will see is a lot of content providers trying to wait for that and have content available when thats mainstream. Looking around at ces at some of the models available, who are the potential winners in the space . Boy, im not the one to gauge sort of the setmakers but i can talk to you about the contentmakers and netflix is going out and saying were going to put a flag in the ground and were going to make sure we have a lot of 4k content available. Most of the 4k stuff you will get will come from web video providers like netflix or even youtube. I wonder what you think about this. Netflix has done a really good job of driving Consumer Habits responding to their original content programming. Is that enough to reshape consumer demand across the country . I dont think they think people will buy a 4k tv because they have netflix and theres a handful of shows available. They want to make sure when 4k is available you can get netflix. Netflix is stung by the video that web video looks crummy and they want to say this stuff looks really high quality and you can get it from us. But what kind of investment on the backend do they have to do to make sure it doesnt take up a lot more bandwidth, for example. So will it be worth it for them to make this big investment . Yeah. The investment for someone like a netflix is on the Software Development end. Theyre working on encoding to make sure they can compress the files. One big road block is making sure people have fast enough internet to their house to get the netflix 4k stuff. You need 15k megabits to your house. Theres a solution where you need 10 megabits to your house. Thats only 25 of the country. Peter, thanks very much. Appreciate it. Well keep an eye out for 4k in the months ahead. Lets send it over to dominic chu for a quick earnings flash. One that appears to be a disappointment. We have time for bed, bath and beyond. They posted a weaker than expected Third Quarter earnings number and sales number. They also cut their full year fiscal 2014 guidance as well as their Fourth Quarter guidance so, again, a miss on earnings a miss on sales, a cut to their full year, and a cut to their Current Quarter forecast. Thats what has shares down about 8 bed, bath and beyond shares down 8 in the market. Thats two big announcements from two big box retailers in less than half an hour. The term genetically modifies may be greek to you but not to the whole Foods Grocery lines. While cho ba ni is being pulled from shelf. The ceo speaks to me about this and other controversial complaints about the shrinking size, for example, of their flagship product, the yogurts, but charging the same price. You want to hear what he has to say about all these issues. Keep it right here. [ cellphones beeping ] [ cellphone rings ] hello . [ male announcer ] over 12,000 financial advisors. Good, good. Good. Over 700 billion dollars in assets under care. Let me just put this away. [ male announcer ] how did edward jones get so big . Could you teach our kids that trick . [ male announcer ] by not acting that way. Ok, last quarter. [ male announcer ] its how edward jones makes sense of investing. [ male announcer ] this is the story of the little room over the pizza place on Chestnut Street the modest first floor bedroom in tallinn, estonia and the southbound bus barreling down i95. This magic moment it is the story of where every great idea begins. And of those who believed they had the power to do more. Dell is honored to be part of some of the worlds great stories. That began much the same way ours did. In a little dorm room 2713. This magic moment [ male announcer ] the new new york is open. Open to innovation. You want to hear what he has to open to bold ideas. Thats why new york has a new plan dozens of tax free zones all across the state. Move here, expand here, or start a new business here and pay no taxes for ten years. Were new york. If theres something that creates more jobs, and grows more businesses. Were open to it. Start a taxfree business at startupny. Com. Welcome back. Red hot yogurt brand chobani hitting a streak of bad press. Whole foods wont stock the shelves because of genetically modified ingredients and down sizing from 6 ounces to 5. 3 but keeping the price the same. Lots to discuss with the chobani ceo. Hamdi, welcome. Thank you. Thank you for having me. Whole foods says they will phase out gmos. General mills saying its going to discount using them in cheerios. Why do you continue to use gmos . Well i think theres a lot of confusion on this topic. Im here at nasdaq and in a closing ceremony with the fit week healthy eating. That has been in our dna from day one, and i think i was on some of your Colleagues Program early on and asked the same questions. You know the story has changed a couple times. First they said it was reason of gmo and then says it was going to be some exclusive products and all other things. And i think more and more this type of stuff confused the consumers. Now, there is confusion everywhere, but chobani has started with the belief that good food for everyone. Lets take the preservatives out, take the colors out, take the hormone from the cows out which we have done it from day one. And then it becomes, you know, available everywhere. Its everywhere. People know who to expect. Chobani has not started with organic milk. Theres not enough supply to make that much for us which is not accessible for everyone either. When it comes to milk which is gmo or not, it comes to point of can the farmers feed their cows with the corn that has no gmo in it and thats its just not possible. Its not possible. If you look at any milk in the supermarkets which is not organic or any cheese or any Dairy Products from one end to the other end, they literally cannot say its gmofree, and i think the story of whole foods has changed a couple times and latest its been about making more exclusive product for, you know, their consumers which i respect that. Perhaps more going on than meets the eye. You raise an interesting point. We certainly hear this when we talk to general mills, for example, the other day. A lot of consumers are saying half are up in arms about gmos. The other half doesnt know what it stands for. There seems to be an educational wave thats going to play out here. Wanted to ask you, did it have anything to do with price supply concerns with shrinking the size of the yogurt cups. Of course not. That was planned a year ago. The Industry Standard is 5. 3. We launched the 5. 3. This year we launched our simply 100, only Natural Ingredients sweeten sweeteners. We couldnt do it all these years because we were having so much difficulty to make enough product. Once we built the plant in idaho, then we could adjust it. And 5. 3 was this opportunity to make sure that our chobani is compared to other ones is apple to apple. Its the same size, same calories or better or protein. But at the same time it gives us an opportunity to make a four pack and make it 1 every day. Four back you can buy 1 every day and promote more. Its about making the product similar to rest of the Industry Standards which is 5. 3 and promote more and price it better and also make it accessible for everyone. And its the size thats going into a lot of Students School lunches as more people get familiar with greek yogurt and enjoy it. I wonder what you think happens now. How stay fresh and relevant and exciting to a consumer in a market thats very quickly maturing. The yogurt is just starting up. People are getting more sophisticated about what to expect from yogurt. Five years ago you had products filled with a lot of stuff that shouldnt be in yogurt. Chobani led this effort and we believe strongly that lets not make food especially simple food like yogurt like a luxury thing, like a fancy thing. And if its more available, it doesnt mean its less valuable. But thats what we believe and we want to make sure we want to make good food for everyone in schools final question because theres a message you emphasize is so important. Do you worry that that that your sponsorship of the olympics coming at a controversial one plagued with worries about safety and human rights issues in russia will confuse that message at all . I dont think that human rights issue things. Im really personally its just at this time of the year this time of the age this kind of conversation should not happen. But we are a proud sponsor of our olympic teams and we have products in our in the Training Facilities now were shipping to sochi, shipping to germany for the training and its already in their kitchens. Theyre making smoothies out of it and the chefs are using it. And the whole company, chobani, and the farmers around it, theyre so proud this simple good food made by big hearts is going to be part of their training. And a boon to the upstate economy as you guys have taken off. Hamdi, thank you for being here. Really appreciate your time this afternoon. Thank you so much. Chobani from the nasdaq. Were heading back to the vegas. Up next Penny Pritzker on u. S. Government initiatives to spur Technology Innovation and growth. You wont want to miss what she has to say. Keep it right here. Make it happen with fidelity active trader pro. Its one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. Hmm, fifteen minutes could save you fifteen percent or more on Car Insurance. Everybody knows that parker. Well did you know auctioneers make bad Grocery Store clerks . Thatll be 23. 50. Now. 75, 23. 75, hold em. Hey now do i hear 23. 75 . 24 hey 24 dollar, 24 and a quarter, quarter now half, 24 and a half and. 75 25 now a quarter hey 26 and a quarter do you wanna pay now, you wanna do it, 25 and a quarter sold to the man in the khaki jacket geico. Fifteen minutes could save you. Well, you know. Chuck vo theres a saying around here you stand behind what you say. Around here you dont make excuses. You make commitments. And when you cant live up to them, you own up and make it right. Some people think the kind of accountability that thrives on so many streets in this country has gone missing in the places where its needed most. But i know youll still find it when you know where to look. Welcome back. Were going back out to the Consumer Electronics show for a first on cnbc industry with customers come mermerce secretary Penny Pritzker. Thank you so much for joining us. Tell us what brings you here to ces. Im secretary of commerce and theres a lot of commerce going on here. One of the most important parts of our agenda is innovation. Coming out to see whats going on but also to let people know how supportive we are at the department of commerce in terms of supporting innovation and entrepreneurship. One of the big concern of the Tech Companies is this nsa scandal. Theyre very concerned when they go to do business overseas companies are afraid to work with them. Governments are afraid to work with them because of all of this spying. How do you address those concerns . Well, the president has asked for a review and theres been the review board and theres an internal review. I cant give details of all that. But what i can say is the president has asked us to think about the cost benefit analysis of surveillance as well as to take into account National Security we have to protect ourselves, privacy. The president and i take privacy very, very seriously. Its extremely important, and, of course whats the commercial impact of all this . These are things being taken into consideration as the president determines where hes going to come out on the whole subject. What is your plan for how youre going to protect the companies here when it comes to their corporate growth . Well, you know thats our job. Our job is to set the conditions to innovators and entrepreneurs and companies in america can grow. Our plan revolves around helping companies export. Number one thing weve been asked by companies to do when i go out and talk with i have talked to over 800 Business Leaders in the country in my short tenure. Number one thing they want is trade. Help us export. They recognize 95 of customers are outside the United States. Help us enter markets, help us know which markets, and we at the Commerce Department can do that. We also work very closely on our trade agreements. We have new tpp agreement, new Transatlantic Partnership agreement with asia as well as the negotiations for new trade agreements with europe. Thats the number one thing i hear from companies they want us to do to help them. We look forward to see what you do over the rest of your ten nur tenure. Penny pritzker thank you for talking with us. We want to bring you a quick update on the situation happening around Chris Christie in new jersey which involved perhaps some people in his administration and their reaction when it came to the traffic appointments or traffic situation out there. Anyway, lets get straight to the statement from governor christie. He said what i have seen today for the first time is unacceptable. Hes referring to tessxt messages. Not only was i mislead by a member of my staff but this was done without my knowledge. This type of behavior is unacceptable and i will not tolerate it because the people of new jersey deserve better. This behavior is not representative of me or my administration in any way and people will be held responsible for their actions. The governor in other words, distancing himself quite a bit from those actions we reported on with eamon javers earlier. Lets send it to dominic chu for a quick market flash. This is an update on the situation over at macys. We told you about the job cuts. Remember we said its laying off 2,500 employees. It also reported a Comparable Store sales for the Holiday Season up about 3. 6 for november december. It also sees 2014 earnings per share full year coming in between 4. 40 to 4. 50. That comes ahead of analysts average estimates. So again so a pretty decent story. The job cuts obviously not a good sign but still cost cuts there better Comparable Store sales and a forecast at least for full year 2014 initially that is above analysts estimates. Back over to you. Dom, thanks very much. Another reminder that that kind of behavior is rewarded today. Tired of the freezing cold temperatures . Stick around for the stories heating up our website next. Plus tmobiles ceo explaining what he hoped to accomplish by crashing the at t party at this years Consumer Electronics show. They kicked him out of that party. Lots of headlines from his presentation. Well get the real story and bring that all to you right after this. Dont touch that remote. Who found a magic seashell. It told him what was happening on the Trading Floor in real time. The shell brought him great fame. But then, one day, he noticed that everybody could have a magic seashell. [ indistinct talking ] [ male announcer ] right there in their Trading Platform. [ indistinct talking continues ] [ male announcer ] so the magic shell went back to being a. Shell. Get live squawks right in your Trading Platform with think or swim from td ameritrade. Before you settle for another ordinary mattress, isnt it time you discovered the sleep number bed . The only bed clinically proven to relieve back pain and improve sleep quality. And right now, its our lowest prices of the season. Save 300 to 800 on our newest innovations. Plus, 18month special financing on all sleep number beds. Only at a sleep number store, where queen mattresses start at just 699. 99. Sleep number. Comfort individualized. Welcome back. How is everything . Theres nothing like being your own boss and my customers are really liking your flat rate shipping. Fedex one rate. Really makes my life easier. Maybe a promotion is in order. Good news. I got a new title. And a raise . Management couldnt make that happen. [ male announcer ] introducing fedex one rate. Simple, flat rate shipping with the reliability of fedex. Another market flash. Straight over to dominic chu on this one. We have a lot of retail action after the bell. This time its zumia. They reported Comparable Store sales in december that fell 2. 4 . Lowered Fourth Quarter guidance. Taking an 8 hit for zumiez. Back over to you. Its still freezing outside across most of the country but cnbc. Coms allen was ler is here to warm you up with stories at the top of our hot list. We have obamacare again throwing off the heat for us right now. Weve got a write up of a souray from bank rate. Com asking people essentially whats happened to your Health Care Costs in the last year. They found people found their Health Care Costs are going up for the most part. And they seem to be souring on obamacare, too. No doubt because of all the recent troubles over the last few months. On average 44 are saying theyre seeing a big rise in their out of pocket Health Care Costs and in their premiums. A little upset about it. The experts say this may be due to cadillac tax, things like that. Of course because all at the time that actually Health Care Inflation has been quite low but i digress. Number two is my favorite guy, jim cramer. He earlier today had comments about Marissa Mayer and her performance and how she seemed to channel steve jobs. Thats been up. And people have been fascinated by that, but you got two big names in the tech word. That seems to be the draw there. The third one is my favorite story of the day though. Diana olicks writeup. Her tagalong with the foreclosure guys. I love that. She went along, took a camera crew with her to an actual where they bused into the house and see whats in the house and what kind of shape its in. We have her write up plus the whole video plus extra video just for the web. Look at that. Thats been a big pull. People have been loving that. I love reading her stuff. That walk through was fascinating. Thank you, sir. Take care. Mandy, looking at that i think it was kind of a little bit of a lens into how this whom foreclosure cycle on the investment side has worked. I havent seen it. I think there was a tweet saying thank good we didnt have smellovision yet. They were in rough shape some of these properties. You really had to be imaginative to think about how they go from kind of a dump to the transformation once investors decide to go into that space. Real estate stuff, its a hot market. This is a small example of what people, blackstones of the world included, are doing on a much longer scale. Allen forgot to mention jim cramer not only looked yahoo because of maier but because of their investment in alibaba. Big chinese online shopping. Is it like 150 billion sometimes units is a figure i heard thrown around. It is incredibly popular. Crazy. This is going to be the big ipo of the year, isnt it . Oh, yeah. I would focus on the obamacare. If the hmo stocks get hit, from a portfolio point of view i dont think you want to be buying some of these hmos. Its not just because obamacare eventually will lead to better volume growth but its also these stocks are highly correlated to job growth. If you think the job market is improving, these stocks should do better. Weve been getting tons of tweets on our millennial guest yesterday. Here is a clip of that interview if you missed it. Im going to make you an offer. Come and work at one of my companies for six months and i will nope. I will fix you. Not going to happen. Come occupy wall street with me and i will fix you. That was quite a response to that segment. You had a lot of zinger tweets. Coming up well read some of them. Just ahead, the bad boy of telecom tmobiles john legere fresh from the at t party in vegas. The real story on why they escorted him out. Well be right back. Return on investment isnt the only return im looking forward to. And my parachute definitely isnt golden. [ male announcer ] for some, every dollar is earned with sweat, sacrifice, courage, which is why usaa is honored to help our members with everything from investing for retirement to saving for college. Our commitment to current and former military members and their families is without equal. Start investing with as little as 50. Welcome back. Tmobile has been making and stealing headlines this week and not just back. Tmobile has been making and stealing headlines this week. Not just because the ceo was escorted out of a rivals party over the weekend. Announcements out from the wireless carrier. Important moves in this industry. We want to get straight back out to the Consumer Electronics show in las vegas. Jon fortt is there. And the tmobile ceo, john legere. Jon . John legere just got off the stage. You want to talk about the big announcement that youre going to pay early termination fees to those who want to switch to your network. Took shots at at t sprint verizon. First, a big macklemore fan . Big macklemore. You got kicked out of the at t party. I had a pass. I went. I love macklemore. Were you going to make some mischief . I could see why they think i would. But this particular day, all i can tell you is the humanity that surrounded me and escorted me out. Ill give you one fun line. I said to the woman, are you sure that at t wants to throw me out. And she listened to the mic. And she said i talked to the ceo. She wants you to leave. Im not sure what that was. Clearly, if at t was angry enough to throw me out then today, they probably would do more than that. It seems like maybe they had a whiff of what you were doing because they targeted their 450 offer specifically toward your customers. So youre going to pay 350 worth of early termination fees for people to switch to your network. Its a vote of confidence in your network. But the financial implications, first of all. If people actually do that plus you subsidize the phones, youre talking potentially 500 million if people switch. Youre paying up front. And theres no guarantee people will stay. Lets do a couple things. First of all, whats important, is this is not an offer. Ive heard them say, these offers come and they go. No. This is serious, philosophical change forever in our business. The end of early termination fees, which we believe is important because it is the death null in contracts. What weve agreed to do not well pay. Were going to eliminate. And the industry has to respond. For a family of four 1,880 if they can get out of their contract. We will pay 350 a line for them to move over. And the fun part is they can make a profit on their phone. If you bought an iphone 5s you paid 199. Well give you almost 300 for the phone. You take the profit. And then well give you a zero down, all devices right now, zero down. Equipment installment plan. Youre out the door. When you get your etf, send it to us. We pay you direct. Got you. Can your network handle it . Based on what you have now, the lte is very fast. But every lte network when its new is pretty fast because theres hardly anybody on it. When theres traffic, how will your network hold up . Couple things. On your beautiful phone that youre hiding down there, you have speedtest. Net. Everybody sits and does speedtest. Net. We released the data that shows that tmobile has the fastest lte in the nation. We announced 700 megahertz spectrum we started to deliver. Our footprint is good. Our spectrum is beautiful. Our speeds are fast. A survey done last week said that 78 of customers would consider switching to tmobile if somebody paid their etfs. Now, if they all come we have a different conversation. But right now, we have beautiful potential capability for the company. Thank you. Theyre telling me i have to wrap up. No question what youre doing is a boone for consumers. Makes you wonder what will happen if that at t merger had gone through. Guys, back to you. Thanks for joining us john. Great stuff, jon. We appreciate john legere as well. Makes you wonder about the sprint acquisition. You were sending tweets about our millennial guest yesterday. The best of those tweets when we come back. [ male announcer ] we could say a lot about the most tracktested is ever. But the truth is. We dont have to. The experts have spoken. Now its your move. Aflac aflac got em. Yeah hes clean, boss. Now listen to me, duck. I have an associate that met with, uh an unfortunate accident. While hes been incapacitated somebodys been paying him cash. Now is this your doing . Aflac . Now, if i met with some such accident would aflac pay me . Nice. This is your stop. [ male announcer ] find out what aflac can do for you and your family. Aflac . [ male announcer ]. At aflac. Com. [ male announcer ] this is the story of the little room over the pizza place on Chestnut Street the modest first floor bedroom in tallinn, estonia and the southbound bus barreling down i95. This magic moment it is the story of where every great idea begins. And of those who believed they had the power to do more. Dell is honored to be part of some of the worlds great stories. That began much the same way ours did. In a little dorm room 2713. This magic moment welcome back. Rolling stone freelancer Jesse Myerson writing a piece about a few reforms he wants to see in this country. He got Kevin Olearys attention yesterday. And that lit up the twitter verse. We got a lot of responses. Lisa tweeting i know some 4yearolds that would like ice cream for breakfast. William tweeting how does the guest expect to pay for his utopian world. And you have to get the 50 of nonvoters to vote for their economic interests. Most of americans are on your side. Nathan, you think thats the case . Most americans agree with him . I think that most millennials, which is what they were talking about in the Rolling Stone article. The parents have been trying to keep this thing together with twine. And the millennials are coming along going, boy, its actually you have to work hard and its tough. College education doesnt go where it used to. Yeah. But you sound sympathetic, nathan. Do you blame your own generation for some of the woes you cast upon the rest of us . You know ill take the compliment that you think im part of that generation. I mean ill tell the folks in makeup about that. I think what it really says is main street the reason that main street says they dont like wall street is their reality is different from stockholders which 10 of the stock in this country is 10 of the population owns 80 of the stock. Thats where youre seeing it. Thats the cold reality. Theyre not participating in the system from an equity side. The market the dow was down about 68 points. The nasdaq and s p are doing a little better. You were pointing out, speaking of fast moneys anniversary coming up. On this day, all the way back in 1987, the dow closed about above 2000 for the first time. You think of whats happened between then. 27 years of market histories. I want to see if booms and bust repeat this time around. Thanks for joining me on the program this morning. Its been a lot of fun. This afternoon, i should say. Well take another look at what happens when we get digest the fed minutes. We have alcoa kicking things off after the bell. You dont want to miss this program on the closing bell tomorrow. Friday, were building up to the payroll reports. A lot in store for the next couple trading days. A special edition of fast money coming up. Is melissa lee joining us . No. I dont know. Melissa lee, fast money. Theyre so busy with the anniversary. One person who wont be on fast money. She will be watching. The special edition begins right now. The nasdaq markets in new york citys times square. Seven years of fast money. Its beautiful. Seven years of investing. Seven. And before twitter went mainstream. Text us at 62288, enter the word fast and your message. And myspace was still cool. Are you ready to update your myspace page . Through the worst of times. Thi