Transcripts For CNBC Closing Bell With Maria Bartiromo 20130213

Hasnt been apple or intel or microsoft. Maybe cisco is the one to take us to new highs. The leader today which was positive, amazon, comcast, our parent 100 now and facebook, so, you know, its the new technologies that are leading the way here. Facebook had a nice turnaround after they came out and said they sold apple and buying this one. A big move late in the day but the nasdaq has been positive all day and think that could be the new leader to take us to new highs. Going well off the lows of the day, the dow down 38 points, the s p and nasdaq positive. Stand by for the very important cisco earnings on the second hour of the closing well with maria. See you tomorrow. And it is 4 00 on wall street. Do you know where your money is . Hi, everybody, welcome to the closing bell. Im Maria Bartiromo on the floor of the new york stock exchange. A mixed day for the market. The dow failing to hold on to 14,000 level with the decline of 36 points off the worst levels, even there, as you can see there, a decline of 37 points. Take a look at how were finishing the day overall. A reversal of yesterdays decline and the s p 500 finishing in the green by just a fraction. Just moments away from ciscos Quarterly Earnings report but first lets get to the market. Joining me right now is rod smith from river front Investment Group and Quint Tetreault from tetreault capital and chris lehman and our very own rick santelli. Thanks for joining us. I havent seen you in a while. Glad youre back with you putting money back to work in this market. Are you . Its interesting. You come back at the end of the new year and that i of what your strategy will be. As Value Investors were looking at new stocks and amazing to look at the valuation of the s p 500 which is a pretty good proxy for the whole market. The pe on the market is 12 times and 11 times next year. Corporate profits are growing at roughly 10 , and i think what Retail Investors are doing and Institutional Investors who might be running a little too much cash in their funds are saying ive got to be involved in the market, market is just too cheap and as boshds sell off that may be an indicator the economy may be reflating and well have steady growth for another year. A lot of people want to throw darts at the market and criticize the fact that weve seen such a big comeback and sustained rally and yet valuations are pretty good. Yes, thats also the case, and i work very much with the retail world, maria, and the question i get all the time is people who have held cash because they were worrying about the fiscal cliff, they were worrying about whats going on in washington, saying are they too late or have they missed it . And the point i always try to make to them is particularly in this current environment is that if you are an owner of cash, not for the short term, if youve got a bill that you need to pay in three or four month, cash is the right place for you, but if you have your longer term money in cash, youre lose 2 00 to inflation every year. Weve had a lost decade for cash already. Youve lost 8 of purchasing power in the last ten years, and were having to have another lost decade for cash Going Forward so time horizon is very important. I guess, i mean, one issue though would be am i going to be able to get into this market at lower levels, Quint Tetreault, so whats your feeling on that . Yes, i mean, i get it that valuations are attractive. I get it that there are very few alternatives out there given where rates are, but are there still enough cat lifts that are going to be a problem that send this market lower and enable me to get into better prices . I think i think there is, maria. Im sorry. Sure. I think there is, maria. Weve seen it. The last several years, weve seen this pattern repeat itself. Start out beginning of the year very hot. Last year we had a 10 run. Gave 8 of it back and presented another opportunity when i was with you in chicago in november when everybody was panic selling. A good opportunity. I think the key is investors, theres no question, ill tell you whats moving this market higher, and our guests alluded to it. Its anxiety. Its fear of missing the boat, and the bottom line is people have to look back over the several years that weve had in this incredible run in the market. After the market has had a 10 to 15 run off the bottoms over the last five years has been historically a terrible time to put money to work. Now, we have a retracement which i think we will. Im looking for an 8 decline to the s p 1400 mark. Thats going to be a level that i think new deals, new opportunities will prevent themselves. Whether its the sequestration, whether north korea shoots, you know, something off, i dont know what the catalyst will be, but we are stretched and putting money to work here is very dangerous in my opinion. You dont agree with that, you said that. That would have been my philosophy maybe a year ago, but what i think youre going to see, the market is up 7 . As soon as you see a 2 , 3 pullback, so many cheick cheap stocks, people want to get ahead of the 8 pullback. I would dollar cost average into the market right now. The thing is theres such a buy on the dip mentality. Yes. That even when we do see big declines they are followed by the buy on the dip. Rick santelli you see that as well, even though youre not buying into that idea that this new money is coming from the bond market. No, because theres plenty of other money out there that doesnt need to be in the marketplace to get these type of equity returns, and the one guest said, you know, its fear that they are going to miss the boat. Thats not what i hear every day from many people. I hear its fear that the stock market is going to turn into an apple stock, where one day it looks great, nobody says a bad thing about it, and then, boom, a huge amount of value is shaved off. We live in a world where the average guy doesnt see the economy in the stock market jiving, and they dont look at it as they are not making any money. They are risk averse. Missed opportunities perceive differently with many on the retail level. I couldnt agree with that more, if you have time for a comment. Yes, please. I couldnt agree with rick more. The retail crowd is afraid of the apple moment, they are afeed of the lehman moment, but classically a bull market in its early stages climbs a wall of worry. Yeah. And all you need for stocks to be able to go up is for the worst outcome not to happen. You saw that exactly. People say, well, washington didnt really do that much, well the answer was we didnt have the worst out come. Got to get to the numbers. Cisco is out. Its better than expected at 51 cents a share. Want to get right to jon fortt who hats results. Jon, what can you tell us . Maria, as you mentioned, revenue came in at 12. 1 billion, just about in line with expectations. Maybe a little better. Eps 51 cents a share nongap. The street was looking for 48. Also ill mention net income at 3. 1 billion. The street was looking for around 2. 54, i think, so overall, i havent calculated the nongap gross margin number. This is very good numbers on the margin front which was the number to watch for. I expect some people will be happy with this. Weve got a stock obviously that is moving on these numbers. Lets break down the numbers. The Senior Research analyst with jmp securities. Eric, you heard the numbers, talking about 51 cents a share on 12. 1 billion. Whats your reaction to that . Encouraging to see strong earnings upside. I think the revenue is going to be a bit more of a focus for the broader investment community, but the earnings is encouraging certainly. The earnings are encouraging. What do you want to hear from John Chambers when he speaks . Well, its going its really going to come down to what the outlook is for the top line growth. Cisco has been struggling to generate the Revenue Growth for some time. They have been in very good control of their margins for a while so i think theres good confidence on the earnings front. Its going to be what what steps is he taking to accelerate that top line . In terms of growth, where does the growth come from in your view at sysco in the coming couple of quarters and years . Cisco is repositioning itself. Its becoming it wants to be the number one i. T. Company, and that means that they will be expanding just beyond communications. The usc server platform is a great example of how they have expanded, but its going to take some additional products and directions for them to become a much broader provider, and that will drive the top line. Bottom line here. Would you commit new capital to cisco at 2119 . Were at a market perform. I think its a fair value, but i was encouraged. All right. Well leave it there. Thanks very much. Just heard the numbers on cisco. Appreciate your time tonight, by the way. Thank you. Lets talk with the man in charge to find out where the growth does come from. John chambers joins me now, exclusively the ceo from krisk oerg. Nice as always to see you. Its a pleasure and thank you for the very kind words. Lets talk about the quarter that was and talk with b where the growth comes from Going Forward what. Drove this last quarter, john . How would you characterize things . Well, id characterize things that it was another quarter thats proof point was our vision and strategy is working, and where weve been putting our resources to work are getting the results. We did exactly what we told the market wed do. 47 to 48 cents, we did 51. We said growth in the 3. 5 to 5 range, we did 5, and this is in a market that many of our peers are seeing flat growth or negative and i think you alluded to it earlier, very, very comfortable with our Gross Margins which, maria, one to two years ago, the people listening to your show were most concerned about. In terms of where the growth will go in the future, were watching key market transitions. The cloud is one of those with switching and routing and servers and storage coming together. That market was very hot for us this quarter. The second area is mobility. Almost every application you hear about are people acquiring stuff with Service Providers and enterprise and we have an architecture there that is really, really great and the security that reloads the networks. The last time we were together you talked about the softness in europe, the i. T. Market in europe is softened. Some of your big customers are governments on every level. How did cisco avoid the financial struggle of those marketplaces this last quarter . Talk to us about government and europe which were the two soft spots. Sure. Well, maria, i wish i could tell you we avoided them. What we did is those are clearly negative drives on the growth. Our Growth Numbers were extremely good. If you look at europe we are starting to see potentially early signs of improvement there, but i wouldnt think of europe as one europe. Think of it as germany, northern europe, uk, central europe, Southern Europe and eastern. The northern and uk europe are actually showing early signs of turning the right way. Southern europe is really going to be challenged for a while so it was mixed in europe. We did start to see government, however, around the world loosen up the Purse Strings a little bit. Nothing to write home about but in the u. S. , for example, state and local governments grew for us and federal was not down year over year as weve seen in prior quarts. Do you have any clarity on what this tells you in terms of the next couple of quarters on Government Spending . Not in terms of Government Spending, maria. It does tell you if governments are going to deliver increased services to their customers they have to spend on i. T. Most government leaders do the exact wrong thing. They basically try to hold on to all the employees and dont right size the organization and then use i. T. To provide Better Health care, education, security to their citizens. That usually takes a period of time, but for your state and local government, first resisted spinning i. T. , perhaps ten months ago and its picked up at a healthy growth rate of 7 . John, let me switch gears for a moment because you and many of your colleagues in business seem to be faced with this embarrassment of riches, and that is sitting on a lot of cash in terms of giving you great flexibility in terms of what to do with that money. With 45 billion on the balance sheet, whats the plan . The plans are, first of all, were going to give at least half of our cash generated from operations which this quarter was above 3 billion again to our shareholders, either in the form of dividends or share buybacks. Secondly, our accusations allowed us not to be a router company. We acquired into switching and data center and mobile and in a Search Market and wherever we acquire is where our head count growth is going to be. If the majority of our money remains outside the u. S. , and this depends on tax policies, thats where youll see us acquire Going Forward. Thats, unfortunately, where our growth will occurch weve done 14 accusations in the last year or so much. Majority of those dollars have been outside the u. S. I would like to see that policy change, but were assuming it may not, and, therefore, well put our shareholders money to good use so we can get them the returns. Thats the issue. Everybody is talking about that. Taxes. Last november, i guess, november last year rather, you said u. S. Taxes on corporate profits were too high. Its threatening jobs. Its actually sending jobs and growth to canada so you heard the president last night. You know what happened at the end of the year on the fiscal cliff. Do you have any encouragement that youre going to see this tax situation change, or are you and your colleagues in business going to keep all that money overseas . Well, maria, i think i can just speak for myself and not my colleagues. Well put the money to use, one location or another to have it in the u. S. What i liked about the president s comments last night is focusing about accelerating the growth of this country in jobs, focused on immigration, focus on common trade pacts with europe and across the pacific and you did see this earlier starting to get active in acquisitions which is where our future growth will be. Tax polley will determine where our growth and head count will be. Im a very loyal american citizen and company, but in terms of future growth, unless tax policy changes, you will see that occur outside the u. S. How do you see cisco different in the next couple of years. Youre touching on accusations. How do you see this company changing in terms of where the potential for expansion that is acquisitions might be . Sure. Its a Great Questions maria. If you look we have a chance to move from being the number one Communication Company which i think most of your viewers would agree were there to the top i. T. Company and as we do that our roll in data center, our role in helping Business Solutions is our forefront. Theres a concept called connecting the next internet of everything which means 99 of the devices around the world which can be connected are not, and as you do that that will change Business Models and held care and education. Our goal is to lead in that starting with areas like start grid and start connected communities. The third element were looking at is the network is very intelligent and you wont know where processes are or service or software resides. Well think about an Application Center Networks Networks that are program kabl so those are three big bets for the future that might go beyond what some of your viewers are traditionally thinking about cisco. We were talking moments ago with the chairman of the intelligence community, and he was telling us banks, for example, are hacked or attempts to hack them happen 300,000 times a day. It seems to me that nothing is growing as fast as data. We all know that. Data has to be organized, secured. How big of an issue is this from your standpoint in terms of security of information, john . Its huge, maria, and if i may draw a parallel. Were winning most new opportunities for something they call the smart grid. Its really how you will put electricity moving over the internet, and today there are 360 different protocols out there which means no one spends a lot of time trying to hack it. As you move to ip, security becomes one of the issues. Otherwise could you turn off the lights. If we execute right, we can put security from the cloud to every element of the network to every device so its a very big issue. One that if we execute right over the next two to three years should be a very good Growth Market for us as well. Real quick, john. What kind of a 2013 are you expecting . I think what our customers are telling susa very slow start and just steady improvement throughout year. Im assuming that that means that europe, that we dont have any major disasters there and that governments do not misexecute too badly. I think were all anticipating a few bumps but if government executes that and causes us to pause for a while but the trend is up to the right and a much slower pace than all of us would like to see. Leave it there. Good to have you on the program. Know youll be talking now with analysts and continuing your earnings commentary so well leave it there. We appreciate your time tonight, john. As always, maria. A lot of fun. Thank you. Well see you soon. John chambers, ceo at cisco. Coming up, the latest on mark zurk bckerberzuckerbergs that hes holding tonight for new jersey governor chris kreefty and the Carnival Cruise ship being towed back to port and different stories of how bad conditions are on that ship. More on that coming up. Stay with us. With fidelitys new options platform, weve completely integrated every step of the process, making it easier to try filters and strategies. To get a list of equity options. Evaluate them with our p l calculator. And execute faster with our more intuitive trade ticket. Im greg stevens and i helped create fidelitys options platform. Its one more innovative reason serious investors are choosing fidelity. Now get 200 free trades when you open an account. Welcome back. Activist investors bill ackman expected to deliver tonights keynote address. Kate kelly is there rubbing elbows with the conference. Kate . Reporter thanks very much, maria. I did talk briefly with bill ackman who is scheduled to speak at 5 00. Hell make some brief opening remarks on herbalife so interesting to see what his next potential statement is on that company. Hes obviously been short since middecember, since much earlier last year. Hell also take q a which will be free form. Andrew felled scene of Blue Mountain capital also spoke about a number of ideas and touched on commodities and credit themes. One of his big why is, go long u. S. Steel and shored u. S. Credit in a ratio of 16. He also had the possibility of going short iron ore and an australian name called bortescu. We spoke to or we heard from mick ma require from marcotto who mentioned he likes a Company Called prose which builds hotels on oil rigs and to go long nordion, a health care trade very thinly traded but the trader thinks he sees 50 upside so potential there as well. Well be watching and fast money will be monitoring that speech by bill ackman and the conference so well hopefully see more of it and you. Thanks so much, kate kelly. President obama triggering a hot button issue at last nights state of the union. Lets raise the federal minimum wage to 9 an hour. Ill speak with a Small Business owner who is actually a huge fan of the president s plan. Ill explain why coming up. And then they could be the odd est of odd couples. Facebook founder Mark Zuckerberg hosts a fundraiser for new Jersey Governor Chris Christie tonight. Well take you live to palo alto for the latest on this. announcer scottrade knows our clients trade and invest their own way. With scottrades smart text, i can quickly understand my charts, and spend more time trading. Their quick trade bar lets my account follow me online so i can react in realtime. Plus, my local scottrade office is there to help. Because they know i dont trade like everybody. I trade like me. Im with scottrade. announcer scottrade. Voted best Investment Services company. A talking car. But ill tell you what impresses me. A talking train. This ge locomotive can tell you exactly where it is, what its carrying, while using less fuel. Delivering whatever the world needs, when it needs it. After all, whats the point of talking if you dont have something important to say . If you dont have something important to say . How do you keep an older car running like new . You ask a ford customer. When they tell you that you need your oil changed you got to bring it in. If your tires need to be rotated, you have to get that done as well. Jackie, tell me why somebody should bring theyre car here to the ford dealership for service instead of any one of those other places out there. They are going to take care of my car because this is where it came from. Price is right no problem, they make you feel like youre a family. Get a Synthetic Blend Oil change, tire rotation and much more, 29. 95 after 10. 00 rebate. If you take care of your car your car will take care of you. Want to check on cisco. We told you the numbers earlier, but they are better than expected, revenue 12. 1 billion versus an estimate of 11. 6 billion. Cisco, of course, the dow component. The dow today pulled back from 14,000 as the s p 500 hits another fiveyear high. Lets get to Courtney Reagan wrapping up the days winners and losers. Hi, security. The dow closed lower which means were 181 points away from that alltime closing high. See if we can get there sometime soon. Certainly didnt do it today. When we look at the sectors and see the breakdown, industrials and materials were the days biggest winners but not by a huge margin and telecom and financials that were the laggards when we break that down by sector. One of the biggest talkers of the day was the fact that ge has decide to sell its remaining 49 stake in Nbc Universal to come comfort. That is going to be our 100 boston parent companies. Shares of ge did close at fouryear highs and comcast shares closed at historic highs. Take a look at that. Nice gains. Up 3 and if you look at the comparison chart between the two. Since the joint venture was originally announced in december 2010, you can see comcast karl outperforming General Electric in that period of time and take a look real click at the financials. Part of the days biggest laggards, wells fargo and it has to do with mart lending declining. Not good for that bank to hold down the whole sector. Well keep watching that. It good be the oddest pairing of our time, meanwhile. Facebook founder Mark Zuckerberg is holding a fundraiser for new Jersey Governor Chris Christie. Reporter tonights fundraiser here behind me is designed to introduce governor Chris Christie to Mark Zuckerberg and his wife priscillas social network helping him raise money for the november election and will raise his profile and bipartisan appeal ahead what have we expect to be his president ial bid for 2016. Zuckerberg and kristies friendship dates back to 2010 when zuckerberg started learning for his push for better schools. The main thing that i have to do is find people who are going to be really great leaders and invest in them. Thats what were doing here. Setting up a 100 million challenge grant. Following in the footsteps of another billionaire founder bill gate, zuckerberg is doubling down on education philanthropy. Zuckerberg his and wife donated 18 million facebook shares worth half a billion dollars to the education focused Silicon Valley community foundation. Now facebooks leadership is politically diverse. C. O. O. Sheryl sandberg was an obama fundraising back in 2011 but facebook investor and board member marc andriesen was a vocal supporter of mitt romney. The maximum donation for tonights event is 3,800. Thats the new jersey cap, and we do expect to see some protesters from an Organization Called credo action. They have a protest called for a couple hours before the event begins. Maria, we do expect security to be very tight. Julia, i understand you have other breaking news on time warner. Reporter thats right, maria. Ive confirmed that meredith is the Publishing Company thats interested in purchasing some of time warners magazine assets. They are in talks to potentially buy some of the titles, including into n style, people magazine, real simple. Time warner would retain ownership of time magazine, fortune and sports illustrated. They own titles including more magazine and Good Housekeeping focused on women and parent so these titles that appeal to women as well would have crossover appeal, the idea that meredith could have economies of scale and also benefit from that ad crossover, and the targeting of the very valuable female demographic. Maria . Julia, great stuff. Julia boorstin with the latest there. Up next, the president going to bat for a major minimum wage hike. Theres a lot of debate going on if doing that would help or hurt the economy. Well talk to the head of a Small Business and get both sides of the debate. Later on carnival executives in damage control as stranded passengers aboard the disabled cruise ship get tugged to shore but are the executives understating the state of conditions on board . Well try to get to the bottom of this developing story. Back in a moment on closing bell. [ engine turns over ] [ male announcer ] we created the luxury crossover and kept turning the page, writing the next chapter for the rx and lexus. This is the pursuit of perfection. A quick market flash and over to josh lipton. Reporter two Companies Reporting after the bell and both are getting clobbered. Lets bring you up to speed. Whole food investors unhappy. Eps on sales of 29 billion. Shares of 283 to 287. The street wanted to see 290. Another name. Weight watchers getting clobbered here as well. Fourthquarter adjusted earnings per share of 96 cents on sales of 407. 9 million. Again, the outlook sees fiscal year earnings of 3. 50 to 4 and analysts wanted to see 3. 75. Large companies and small are grappling with how to pay for retirement in the new health care law. The employer mandate has many looking at hiring and staffing choices right now. Bertha, what can you tell us . The employer mandate comes down to three big numbers, 50. Thats the number of fulltime employees where the mandate kicks in, and you have to provide insurance coverage. 30 is the number of hours at this point thats going to be considered fulltime, 30 hours a week and ten essential benefits that are going to be required in the new plans which a lot of firms worry will be much more costly than what they are offering now. Some restaurant chains investigation peermted with cutting hours because theres no mandate for parttime workers, but they have seen a backlash on that. Buffalo wild wings ceo sally smith says it will come down to the right tools to get the right staffing mix. I think well continue to continue to refine our labor model and Labor Software will come out to help retailers and r restaurants, restauranteurs meet the demand. Reporter a crm company, batchbook, which expanded its staff 20 last fall, the question now is whether they can afford the regulations if they grow to that magic big 50 staff level. You dont hire someone unless you can afford them, so the question is what we can afford. To pay someone when youve really you dont have a good understanding of what that benefits package is going to cost. Every ceo tells you they dont have an understanding because the rules arent finalized. Read my full report on the big and smallfirm challenges on cnbc. Com. Well do that. Bertha coombs, thank you so much. Well watch businesses meanwhile struggling in this country like everybody else trying to figure out the new health care law. As we heard new taxes and now the potential for a higher minimum wage. Heres what the president said last night in his state of the union speech. Tonight lets declear that in the wealthiest nation on earth no one who works fulltime should have to live in poverty and raise the federal minimum wage to 9 an hour. So how will that play out . Will a minimum wage hike create jobs or cut them and destroy them . Ceo and owner of an interness net Marketing Company joins us and employs 100 people and supports raising the minimum wage and Michael Saltsman is Research Director at the policy institute and calls raising the minimum wage is a recipe for disaster. You couldnt disagree more. Ken, you say raising the minimum wage will make workers at your company more productive. Yes, i think theres something with job ownership and the stigma that goes around with actually being a minimum wage employee, and i think when the people are actually looking at what the minimum wage actually buys them with inflation nowadays, by raising it, it will actually, in my mind, kind of increase productivity. It makes sense. Michael, why do you think its a recipe for disaster . I think its a recipe for disaster because the minimum wage has been proven through decades of research to be a job killer, and, you know, every time we have one of these minimum wage debates, advocates are always able to find a couple of businesses that say, hey, i like this, but i think ideological support among a few businesses doesnt mask what weve really seen in terms of the harmful impact among restaurants and Grocery Store and service intense businesses that dont have large Profit Margins so when their labor costs go up by 24 as the president wants to do, if they cant offset that through higher prices they have to scale back elsewhere. They have to provide the same product with less service, so if youre a Grocery Store, maybe that means moving to selfcheckout lanes instead of hiring grocery baggers and if youre a restaurant maybe that means having waiters and waitresses bus their own tables instead of hiring busboys. What about that, ken . You know, i i look at it from a different approach, and i think, you know, were all consumers out there and all out in the world purchasing things and going to restaurants and going to food stores, and i think that, you know, weve all been victims of scenarios where we thought that the labor pool and the people that worked in a certain place didnt really care about our business, and, you know, my point is really i think the more people see the value of having that job, you know, the better they are going to do and maybe fewer people are inclined to stand in unemployment because they know they will get more. Heres the thing. Like the value of a job, the Unemployment Rate for young adults right now or people who work at the minimum wage has been above 20 for over four years. Right now the problem isnt that people arent seeing the value of the job. The problem is that people arent find a job so if you raise labor costs by 24 thats fewer opportunities for these teens to fill. So youre okay, ken, with raising the minimum wage on your 100 people to 9, you dont see that as a big impediment in terms of your own costs . No, i dont see it as a big impediment because i think we would have a right to expect more from them for paying them a higher minimum wage. Why dont you raise their salaries then . We do, you know. We have a process that we kind of put through, but the higher you start them out as you kind of put through that process and grow, the more difficult it becomes and the price becomes to scale which is what weve seen across the board with so Many Companies as people are there long time, their costs become, you know, it makes them too much money, so you have to start somewhere, but, you know, we like the idea of being able to ask more by where were starting with. The idea of making too much money for a company thats making a 2 , 3 profit margin is just laughable. You know, the evidence of this, you dont even have to look hard for t. Cities like albuquerque, new mexico, raised its minimum wage at the beginning of the year, and youre already seeing headlines there, you know, restaurant cutbacks, restaurant that cut hours two days a week and opted not to hire six new employees. I mean, these are actual ontheground consequences that are happening, so if ken wants to wants to give his employees a raise, thats fine, but we dont need the government to mandate that for all other businesses, especially marginal businesses that cant affit. Well, whats the answer then to moving needle on the middle class . How do you think you should do it . Who is earning the minimum wage who is trying to help. One in six people who earns the minimum wage is a single parent supporting children, so lets say were trying to help that group. Do Something Like expanding the earned income tax credit which will boost their wages through the tax code instead of a mandate on employers. Shown to reduce poverty unlike the minimum wage which has been shown not to reduce poverty. Thats a good idea. The mandate is going to hurt for some businesses, not necessarily yours, ken, but certainly having the mandate. Well keep watching this. Thank you so much for joining us. Appreciate it. Thank you very much. Thanks, michael. Thank you, ken. No triumph here, passengers stuck on a disabled cruise ship by the name of triumph getting an apology from the company ceo. What about food and bathroom facility. Well take you live and later what about tomorrow. What could move your money big time tomorrow. Our wall street pros will be telling us what to watch and prepare for tomorrow. Back in a moment. [ indistinct shouting ] [ male announcer ] time and sales data. Splitsecond stats. [ indistinct shouting ] its so close to the options floor. [ indistinct shouting, bell dinging ]. Youll bust your brain box. All on thinkorswim from td ameritrade. We all work remotely so this is a big deal, our first full Team Gathering i wanted to call on a few people. Ashley, ashley marshall. Here. Since were often all on the move, ashley suggested we use fedex office to hold packages for us. Great job. [ applause ] thank you. And on a protocol note, id like to talk to tim hill about his tendency to use all caps in emails. [ shouting ] oh im sorry guys. Ah sometimes the caps lock gets stuck on my keyboard. Hey do you wanna get a drink later . [ male announcer ] hold packages at any fedex office location. Omnipotent of opportunity. You know how to mix business. With business. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or above. And still pay the midsize price. I could get used to this. [ male announcer ] yes, you could business pro. Yes, you could. Go national. Go like a pro. Welcome back. A real nightmare on the high seas hitting carnival shares. The stock down more than 5 and a fire disabled a Carnival Cruise shupp on sunday. One of the passengers has been evacuated because of his health concern. How is everybody else doing . Jay gray has the latest from mobile, alabama, where the ship is being towed. Jay, over to you. Reporter hey there, maria. That tow not very quick. 7 miles per hour, about the pace of a normal jogger so it will take some time. Triumph wont be port here until sometime tomorrow afternoon whmp day rivals the city of mobile will have medical personnel on hand to take care of any passengers or crew members that may need care as they come off of that ship. At least one person has been removed. Someone with a preexisting Health Problem over concerns for that. That was during a time when another carnival ship delivered food. What passengers will tell you still not enough food, the lines to get the food, three, three and a half hours, that the stench from the problem with the sewage is inescapable and overwhelming. Many have pulled mattresses into hallways or up on to the deck to try and sleep. Theres no air conditioning, so its described as a horrific scene on that ship. You talked about the financial hit thats going to hit this company. They are saying that it would be as much as 80 million when this is all said and done, a tough go both on the financial side and the physical side as the ship inches its way towards shore here. Thank you so much. Families and friends of cruise passengers desperately trying to get in touch with their loved ones and those who have been in touch are reporting horrific conditions which conflicts with what the cruise line is staying. Whats the real story . We called carnival and they did not respond to our questions. Jennas sister and niece have been on the cruise. You were supposed to go on the cruise . It was a bachelorette party. I decided to go to the wedding but not the party. Tell me what youre hearing. We think that the batteries have run out on the cell phones, and the cell phones were very sporadic as far as getting a signal anyway. The food, they did get food from another boat but they got meat and chicken which they cant cook so that didnt happen. They are eating ham and cheese sandwiches, all they have had according to my sisterinlaw, and as we mentioned the toilet problem is a huge issue. They are going number one in the shower and number two in little bags and the boat is not giving them anywhere to put the little bags, so the bags are just being put in the hallways so it smells horrible. Now their room she said had smoke in it so thats why they took their mattresses up to the deck. They are being limited to the two upper decks. They dont want them on the lower decks because theres no lights so all the people are stuck on the boat and stuck to just a limited area. This is real sort of straight from the horses mouth, if you will, because youre speaking to your family members, but the cruise line is downplaying the conditions. Why are they doing that . Isnt it obvious that this is going to come out. Tomorrow 3,000 people will get off the boat and contradict them. Why would they Say Something thats not true. Its obviously a pr disaster. You know, and another thing that is also happening is my niece works for a very small company. She had three coworkers with her so this Small Business is out of several employees for an entire week. So even its hurting other businesses that, you know, we havent really thought about that part of the story, too, so its awful. They havent sent you any pictures. Would like to see whats going on on the ship for our sglefls again, its been very sporadic. A couple of texts and one phone call. And when you say having ham and cheese sandwiches, where is the food coming from. No ability to cook anything. Right. No way to cook any food so all they can have is cold food, and as you mentioned they have to wait in line for the food, and my sisterinlaw says theres just not enough food for everybody. So you work at the street, a Market Strategist there. When you see a real life situation like this, what does that lead you to believe in terms of prospects for the company and the stock . Im only asking you this because thats what you do. Right, right. Well, obviously you would think as your reporter mentioned, 80 million hit and how many people are going to book another cruise based on this . Now, they were offered a free cruise, but they have to take it within six months. Who is going to be able to get off work again, already been out of work again to take another cruise and who wants to get on a boat after this nightmare. Costa concordia. I dont want to get on a boat, do you . Im a little seasick from it. All right. Thank you so much for sharing your story. Lets get to brian sullivan. Breaking news on apple. Apple has filed a response to David Einhorns lawsuit around proposition 2 which is what essentially einhorn believes is the elimination of preferred stock by a. He wants it. He says it will, quote, unlock shareholder value. He sued apple and heres the response. In the response thats 22 pages long i just went through it. Apple number 1 says that this prop 2, right, whatever you want to read it as, einhorn reads it one way, is a recommendation from institute Shareholder Services so they are a Consultancy Firm so apple is saying iss recommended it. Number two, in a conversation with apple cfo Peter Oppenheimer David Einhorn called the need t as a quote as a declaration from oppenheimer, the cfo of apple, not what einhorn wants to hear. And apple noting in this suit that it can still issue preferred stock if shareholders vote on it. Einhorn seems to believe it is the elimination of preferred. So, a lot of stuff in here but apple firing back at David Einhorn, maria. Thank you so much. Tomorrow is valentines day. Will the markets have a reason to pop or swoon at the open . Wall streets finest weighs in next. Weve completely integrated every step of the process, making it easier to try filters and strategies. To get a list of equity options. Evaluate them with our p l calculator. And execute faster with our more intuitive trade ticket. Im greg stevens and i helped create fidelitys options platform. Its one more innovative reason serious investors are choosing fidelity. Now get 200 free trades when you open an account. Hes going to apply testosterone to his underarm. Axiron, the only underarm treatment for low t, can restore testosterone levels back to normal in most men. 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But i am your rmarket data. I know what youre looking for. Im not chained to your desk anymore. Im faster and smarter now. And so much less expensive. I am your market data. And if i do say so myself, i have never looked better. Superderivatives introduces dgx. Data done differently. Welcome back. 30 seconds on the clock. Our next guests will tell us what to be prepared for tomorrow. Will we see dow 14,000 again . Joining me right now, brian evans, visili srebokov and stephen rosen. Gentlemen, good to see you. Thank you for joining us. Brian, kick us off here. What happens tomorrow . Well, cisco will be reporting their earnings. Watching for continued indications that the stock market is undervalued. So far this year, 76 of the corporations reporti ining earn have exceeded expectations. We will be watching for reactions to the economic and Debt Reduction themes from the state of the Union Address and finally, positive cash flows have led to rallies in international equitieequities, International Bonds and alternatives and poor fund flows have been holding back the u. S. Bond market, especially the treasuries, and certain commodities. We should point out, cisco has reported the numbers were better than expected but john claim berms also told mel hes looking to a slow start and that stock was trading down a few minutes ago. So, well check that again. Visili, youre up. Well, were watching the g20 meeting. We expect the message to be very similar to the g7. Its okay to monitor policy aggressively but not target exchange rates. The bank of japan has been by far the most aggressive warrior out there and that means ongoing weakness in the japanese yen in our view. All right, well keep watching that. Weve seen real weakness there. Last, stephen, you are up. What do you look for tomorrow . Were watching the xlf. Financials are interesting. The xlf is flirting with 18. We saw that three days after bush signed t. A. R. P. Into law. We think thats going to be what leads this market. We could see new highs in the s p. I think financials is whats going to lead us lower. We break down of financials, i think the s p rally could be over. All right, we will leave it there. Thank you, guys, appreciate your time tonight and see you soon. Up next, when you hear Something Like free, its best to hide your wallet. Back in a moment with my observation. Is moving backward. [ engine turns over, tires squeal ] and youll find advanced Safety Technology like an available headsup display on the 2013 lexus gs. Theres no going back. Tdd 18003452550 this morning, im going to trade in hong kong. Tdd 18003452550 after that, its on to germany. Tdd 18003452550 then tonight, im trading 9500 miles away in japan. 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