Transcripts For FBC Countdown To The Closing Bell 20130301

Countdown to the countdown, waiting on warren and is required reading. The shareholder letter will be released after the bell. Will it reveal another monster purchase . Top profit watchers shareholder. There is a major dinero in learning the languages. Rosetta stone with better than expected and earnings. The stock jumping in the ceo joins us this cozily to talk about the drivers of 2013. And you were sequestered protection plan. What to do with your money of the government cannot give it back together. Helping you find the profit. The countdown starts right now. Liz live from the floor of the New York Stock Exchange in Lower Manhattan on a day were the big question was earlier will we hit the alltime high . Right now talking to everybody, asking that traders. Everyone sang probably wont happen today. What can we tell you . Let the markets right now. We did have a move to the downside earlier today. Take a look. About 24 points. Considerably higher. Looking at the industrials up about 25 points. Looking at what has been happening. We get some early data out of china. This is their version of manufacturing, and it is just above expansion. The market. But then after the president spoke and failed to really well, did not throw a damper on what was happening with the sequestered, right at the moment, looking at a market that is about 80 points away from the alltime closing high, 14,164. Looking to avoid a second week. The nasdaq is on track to snap a 2rig losing streak. The dow, as we mentioned, about 87 points away from the alltime high. Some of the dow winners. The winners, in particular. Bank of america moving higher by nearly 2 . In the wheel licking of walmart up 1 and change. The same with disney. Those of the real movers. We are looking right now. Down about 1 3 of a percent. We also have caterpillar slightly lower. The big loser. Lets put those up on the screens. You can see the big movers. Sales force, a company that is doing beautifully, and we do have it up about im looking at about 7 for that one. Groupon jumping 12 after the flat out ousting of the ceo. An apple struggling. Down about 2 . Even after Hedge Fund Manager David Einhorn abandoned his initial lawsuit which had cost a lot of concern and confusion about how certain money would be put back into shareholders hands. He abandoned it and the stock is hitting an 52 week low. Get to the floor right now here at the New York Stock Exchange. Right here. You know, every trader that i talk to, although it is fresher with uus. And were not going to hit the alltime high. Does the behavior of the market today encourage you or scare you . It encourages. The market is holding very well considering we have gotten over the sequestration was tells you the market is not really concerned about that. I suspect one day next week will readily will try to challenge. Liz today, what surprised you . Earlier were down on bad overseas data it. In fact, some of the unemployment rates, particularly italy hitting fresh ice. I understand that, and even our personal income was down, way off the charts this morning which you thought added to the negative. And we saw the market. My only senses because everyone continues to expect that no one should get nervous. Theyre going to be here, you know, supporting the market. And what we have done. Liz to you ever think about what happens when they are not there anymore . Absolutely. But he made it clear that he is sticking around. He talked about unemployment not getting down until 2016 which is three years out. You think about that. It will be a big drop. Liz oil is down. Gold is now really an exciting moment today. See you infer anything from that . I dont really. The equimark is, we had this move on monday and in the rebound on tuesday. So the market is kind of journey in trying to catch up with itself. Not a lot of activity. Trying to find a level. I think you will find one right in here. Liz continue down on that . I think it is going to move higher. A lot will depend on the weekend. We are in friday, so god knows what happened. But my sense is that the market does want to move higher. Whether an added challenge is that, we will need some positive affirmation to really get up there and challenge it. Dont forget, the s p is further weight. Liz im looking at this and saying, anyone who did not get into stocks one year ago has missed a major party. And that is true, but you know, i dont think that when we talk about investors in the market, people are n the market. Something they should be peeling into. Alec and sitting here with all this cash. I mean, i dont think people are doing that. And so therefore if they are in any way, they have been participating, but maybe they are kicking themselves because they have not participated enough. Too cautious. Liz thank you so much. Another you have trades to do. We have two other traders right now in part two of our flower show. Jeff over at the nymex. Let me spend it out. It is hitting a low for the year to date. I would think that would be equity positive at this moment. Absolutely. Without question. Lets put it this way. Were getting to the bottom of the channel. We reached the objective. We were hoping for about 88. So were getting close. We have not officially broken down. A market that is a sale. It rallies until further notice. Give credit to the evil speculators. Liz the speculator discussion rears its head on occasion, but only when it seems a oil and the Energy Complex is higher. Down in chicago, did you see any corroboration of any kind as a dividend rally in the bond market . You know, i dont know that you are going to see anything significant, but with all this going on in washington, that is my biggest fear. You may see a bit of a rally in the bonds. That is something to look at. I dont think any of this will be long lived. The equity pull back, which i do expect to come, or a bond rally. As tears me, were going to have to keep an eye and our government. Pretty much dysfunctional. We have to hope that they can find a better way is also of these problems. Liz thats great to see. Thank you for joining us on the floor show. Dow jones, up about 29 points, the nasdaq up seven. S p 500 up. Will it be like yesterday were we fumble lead . We would be watching it every single second. Now we need to get to Charlie Gasparino and goldman. Yesterday the story was that they have a socalled emergency plan, its got forbid, blank find leaves are passes on. I dont even want to say it. Emergency replacement, as you know from yesterdays story. Liz that have anything in front of me. It would be, as you know, your buddy. A couple of weeks ago. Liz said he said he wanted it. He said he would be happy. He loves goldman. After i did that story and calls from former executives, people that are close to the firm and know exactly what is going on. And the internal politics of succession is just a little more dicey. Another key guy, he steps in. But their is a long return their is a battle of a longterm succession. And it does involve the president and, from what i understand, the sky, nj eight michael evans, a former head some the Global Growth markets. At that means he runs everything but the trading pits. This guy is a Top Investment banker, a formidable presence. And from what i understand, you can take some credit for this, following the Public Statement saying he wants to stay around awhile, following going out there saying he wants the job, there has been that has ratcheted up the internal battle. What do i mean . Of evans and calendar are jockeying for position, basically to turning to the partners. One of the terms firms that still has partners. Part of a bigger share. Senior people. They often influence the board. Both of those guys are lining up support among those partners. I can tell you. Who was more annoyed and hurt and felt hurt by the statements that he is going to be there while. That just means its on his terms. The pressures are following the regulatory inquiries and the congressional investigations into the role of a financial crisis which we dont have to go through. Evans was most hurt by that. He really wants that job. So does gary, as you know. From what i understand, he was pretty put back. And quickly leave the firm . People are talking about that, that he might go. Hes going to be there until he was never. Liz you dont even want to say it. Dies of Natural Causes at age 99. We should point out that they are all relatively young man. I believe lori is 58, evans, from what ive understand, 56, i believe. Dearies 52. So theoretically liz their children. Their children. If he wants to stay now the pressures off, thats a long time for these guys. Liz this seems like he has been the guy. Sees from cleveland. Liz i think if they dont taken their anti cleveland. At the youre going to Say Something else. You say it. Liz theyre all antisemitic. How could that be possible . Are rich history. We should point out, it is very interesting. Michael evans, i will tell you. I just heard a story on foxbusiness. Com. You can go read and it lays out the case about the negatives and positives, the positives on both of them is that they are smart guys. The negative, goldman may be moving away from the trading models. That involves gary. I think this is considered blatantly ambitious. So he puts off some of the partners that he needs. That is would you have. It is interesting. This stuff always occurs behind the scenes. You know . We are giving you a little insight into it. And it does get pretty nasty from one eye and a stand. Liz if you want insight you go to Charlie Gasparino. On your website right now reading the foxbusiness. Com article. I absolutely am. She is so full of it its not funny. Liz all right. When we come back, Rosetta Stone jumping more than ten full percentage points. We have the ceo. They came out with some really interesting numbers, particularly for online adoption of learning all kinds of languages. Speaking of which come from the Rosetta Stone people, which is the least, the least popular language . We know the most popular will be spanish, english, and direct, but the least popular language. These three choices are your screen. You let me know when you think. Stay tuned. Well be right back live from the floor of the New York Stock Exchange. The Dow Jones Industrials climbing, up 36 points. [ woman ] if you have the audacity to believe your Financial Advisor should focus on your longterm goals, not their shortterm agenda. [ male announcer ] join the nearly 7 million investors who think like you do. Face time and think time make a difference. At edward jones, its how we make sense of investing. Liz welcome back to the floor of the New York Stock Exchange. Dow jones industrials. The key number to look at, 1,000 14,164. Here. Hot. This is star would. Right now is moving higher. You have to believe that if a hotel and resort company is doing well there has got to be this belief that the economy will be okay. Many, many chains. This is the company were watching. You have to love that ticker symbol. One to quickly run up to ben willis of the moment. Can i interrupt you . What is happening . Are you of the believe that we will not hit that big 14,000 my exwife tonya have to tell the kids about santa claus. Liz tell the kids that there is the senate was. Sometime this year it will happen. What did you notice . We have been on the phone. What do you well, i think will we continue to see is inflows because it is the first day of the month. Traditionally an update. Seeing positive and plugs from that side of the equation. Continuing to flow into we have seen the rotation into utilities, telecom, consumer staples. Liz the dividend. But is also the safest place where investors want to dip their talent coming of other Asset Classes and the safety of the u. S. Bond market, if you will. Liz you get to disagree with him. He thinks its going to be fine. What do you think happens . Every monday since we opened in january, we have had a down day. Liz every single monday and then they come every single friday an update. That maintains today. That of we all love to the upside, but monday and would not want to be alongside. Given the fact that the markets have the run and need to have a healthy pullback, however you want to look at it as far as minutes of the market, the market needs to have that. A 5 percent pullback. That is where were headed. Liz before we go. Thank you very much. Before the break we showed you a trivia question for Rosetta Stone which, of course, has the sari, before the break we ask you, the least popular, least popular languages that Rosetta Stone offers because they offer more than 30. Guess what . Swahili. I still thought it would have been hurt do. Lets bring in the ceo. Ceo of Rosetta Stone. You have done very well today with your stock. Lets get this. We put it up on the screen. Up more than 10 for pretty much most of the date. Came in with numbers that mist on revenues. More importantly, lets talk about the online adoption. People learning online. Up 157 . To what do you attribute that . Customers are more mobile and using our ipad features to learn we are seeing triple digit growth. This is the second to quarter in a row that we are expecting strong growth as we go forward. Liz strong growth, but how you capitalize on that . Can i start to believe then that the packaged software that i have already seen at the kiosks is going to go by the wayside . Well, we plan on offering consumers a choice. And so if you want to buy a box cd product we will make it available. If you want to download the digital download, just like you and some movies, thats available. Or if you want something that connects the internet, its in the cloud and available. That is also available. Those are obviously are more popular products. Liz lets get to the most popular languages. What is gangbusters, what is doing incredibly well . What the people want to learn . And it is a global business. It is a global business. And the answer changes based on where you are in the world. In the u. S. Our most popular language is spanish. We also sell a lot of german and french commander in. Outside the u. S. The most popular language, by far, his english. Liz that is nice. And less talk about pricing. There are a lot of free competitive web sites out there. This is what analysts worry about. Free offerings that some people say live from baca, actually theyre pretty good. Out the beat them, how do you convince me that i should be learning spanish or swahili with you guys where it costs money verses the emirate is actually free an online. I think it starts with our product. It works. It is an effective product. It is time tested. We have been around 20 years. It is sophisticated. We have ph. D. Design. This dough and sequencing of what we teach. It is also available on demand, 24 seven. Any time you wanted to midianite come anywhere around the world. So it is convenient. Lastly, it is inexpensive relative to other tools that teach you. So class or tutor. And we believe strongly that the Value Proposition is here today and will be here tomorrow as well. Liz 2013, new products. You promised some. What are they . Tired about kids products, teaching kids languages which i think would be amazing. I think so. We call it the beginning of a franchise. We are at work really hard right now. The beginnings of some pretty cool kids products that will be available, both in the Consumer Market and in the institutional market. And we are excited about that. Liz and guard to do something right now. Im going to make a declaration. I am covering the olympics in russia. Im going to buy the russian Rosetta Stone and see if it works because that is one of the hardest languages i here quinella you know how i deal with that. You will see. Is that a deal . Its a deal. Im looking forward to speaking with you soon. Liz thank you. Great to see you. By the way, can we show the stock jumping more than 10 , 10 11 for Rosetta Stone. Just a terrific day for the company. The president and ceo in a fox business exclusive. Coming up, we even mention the sequester. All anyone could talk about. Frontpage on everything. Politico, washington post, wall street journal. Not much is really affecting the markets. Still up about 30 points for the dow jones industrial. Moving slightly higher. Nothing too dramatic. When we come back, black rock. He will tell us how to keep the portfolio gains coming, even if our government cannot get it together. Live from the New York Stock Exchange and we have 15 more minutes. Liz we are checking in with stocks. Let me just show you what a week it has been. Does anyone remember monday . It has been an unbelievable monday. Monday was down 216 points. What a day. Oh, my goodness, people were so concerned. But then a reverse on tuesday, up 116 points. Wednesday was even better than that at 175 points. The first day yesterday we were up all day and then we lost on the last half hour. I will take the blame,. Liz , down 21 points. We are of about 26 points the dow jones for the week, we can really see what its been like are the big question is what happens as we look at all of this data and if it comes together, and that is the question. What is the winner . What is the dow jones winner . Hewlettpackard, with all of the storm that this company has endured over the past quarter. A lot of issues, up about 5 for the week. Cheering on hewlettpackard. We will be watching hewlettpackard to see that hold onto their gain. Talking specifically about what to do with your money, lets ask our expert on what he thinks will happen. As a chief strategist, let me just get your thoughts. The thing about the sequester is this is not a fiscal cliff. This is a slow. Nothing changes on monday. Over time, if this is not reversed, we will start to see this in april and start to manifest itself. But in the near term, this is not changing very much. Liz lets look forward to march 27. Perhaps that is a more important point. The continuing resolution, that could be a real issue. We are trying not to just look at today. How serious is that if we have a Government Shutdown . If for some reason there is not an extension of the continuing resolution, it would be a major negative for the market and our expectation is he will get some extension. Would you lock in these cuts, will some of them be reversed. The one we are sure of is that we will be looking at this for the rest of the year. We have the deadline in march as he said. And whatever resolution you get is only going to last for about six months. It is a few things to look forward to. Youre looking outside the two countries at the moment that you like investing in. Some of our viewers have never thought about putting money into norway and sweden. But you say yes. Lets give people an idea of how they can do this kind of investment. This is a broader theme that we have spoke about in the past, which is that many of the Smaller Development markets, not emerging markets, but smaller markets came out of the financial crisis in better shape. Budgets are balanced, they have lower deck, labor markets are less traumatized. Technically in europe, you dont have the same exposure to the problems of you do in germany and france and italy. These are examples of countries that i do think has some good longterm opportunities. Liz what about dividends . I must pick your brain on dividends. We have seen some 30 companies in january alone. Another view hiking their dividends. Can you tell me exactly what you make of this . Is it the gift that continues to keep on giving . I think that overall having that exposure makes sense. This is a strategy that has outperformed the bull and bear markets. You raise an excellent point. It can be too much of a good thing, there are parts that are crowded. Two segments in the market that have run up very far in the last two years, largely on this dividend thing, they have been extended. One of our ideas is to look for dividends but to look outside the united states. Hong kong, singapore, we can get an attractive yield at a lower price. Liz thank you so much. We do appreciate your perspective on this. This gentleman has steered our viewers in the right direction just about every time he has been on. Thank you so much, its great to have you. Happy friday the. Liz this place has to be a huge issue with cybersecurity. What america believes it is hacking on the cybersecurity scale. Coming up, one of the top Security Experts from mcafee. He will be talking to the guy who discovered how we can keep these hackers from getting into our computers. Live from the New York Stock Exchange. Stay tuned my mother made the best toffee in the world. Its delicious. So now weve turned her toffee into a business. My goal was to take an idea and make it happen. Im janet long and i formed my Toffee Company through legalzoom. Never really thought i would make money doing what i love. [ robert ] we created legalzoom to help people start their business and launch their dreams. Go to legalzoom. Com today and make your business dream a reality. At legalzoom. Com we put the law on ur side. You are gonna need a wingman. And my cash back keeps the party going. But my Airline Miles take it worldwide. [ male announcer ] it shouldnt be this hard. With creditcards. Com, its easy to search hundreds of cards and apply online. Creditcards. Com. I am Shibani Joshi with your news brief. Rick snyder has declared a financial emergency and detroit. The next that will be to choose an independent overseer to tackle detroit 327 milliondollar budget deficit and 14 billion in longterm debt. The Unmanned Falcon rocket launch of spacex today. The dow jones is reporting that u. S. Factories are expanding for a third month in a row. At the fastest rate since june 2011, the industry rose to 54. 2, up from 53. 13. We continue our countdown to the closing bell with liz claman live at the New York Stock Exchange. Liz welcome back to the floor. We are at the nyse. Fourteen minutes until the closing bell rings. We are firmly in the green. I would like to show you this highyield bond fund. That trade is a little bit in place, not bad for highyield. And improvement in the hiding electronics retailer. We have the gap that is doing well. A all three names of these looking very good. Liz black decker is up 15 . The stock having some trouble, people saying that it is over. It is so obviously not over. It really isnt. This is a stock that was down about 50 over the last year. Now, there is a turnaround. Liz lets get to adam shapiro. We are putting him on the case, he is live at mcafee headquarters in california talking to somebody, i guess the smartypants is unbelievable. They do find the bad guys. I would love to remind you about what we talk about and some of our previous live shots. When a virus gets passed, the firewall that you have on your computer, when it passes the security systems, corporations, not just the consumer, but what do you do . I would like to introduce you to one of the copresident s here. They have talked about a firewall, some other systems, and are they integrated . Yes, you look at traditional security. There is an idea of your firewall, the pc, security on your mobile devices. All of them working together. Is that happening now . Is anyone doing that . It is interconnected and thats what we do here at mcafee. It is definitely a trend inside the industry. One thing that about mcafee that people may not be aware of, we spoke with the other copresident , talking about how you see the big picture. People would not necessarily associate that with protecting Water Systems nationwide. That you are doing that. We are. A lot of people have been trying to steal intellectual property and go after them. But we really havent seen that what is on the horizon is going after infrastructures themselves. We started warning about this. We hope the day is not coming. As a security company, we are trying to do everything that we can with government and private industry to really make sure that we help protect the critical aspects. An incredible amount of this is going into full on efforts to. How have they been trying to prepare to prevent these cybersecurity attacks . The power grid is traditionally where someone would come to your house and get the number off the meter. They move to ip addressable devices. Then it becomes a factor for bad guys to get in and shut power off. All of the Critical Infrastructure providers recognize the sudden they are working very hard to make sure this doesnt happen. Thank you, michael for joining us on fox business lie. We have 500 Security Specialists working around the clock here at mcafee. They say that they never sleep. When you see everything that they had here, you get the impression that they have a lot of insomniacs around here. Think youll. Liz thank you so much. Everyone is sleeping on a futon over there. By the way, next week, it matters to your money. We are going to show you how. All next week, at 11 00 a. M. Eastern in 1 00 p. M. Eastern, we are going to be talking about cybersecurity and how it affects your business. That is right here all day and all week on fox business we are fumbling the lead of just 11 points right now. The s p is almost flat. But nothing fun about what is going to happen after the bell. Warren buffett will be coming up with its annual shareholder letter, which is a mustread for any investor. We have a shareholder and eight Warren Buffett watcher, a buffetologist, if you will. Coming right up. Yield to restful sleep. And lunesta® eszopiclone can help you get there. Like it has for so many people before. When taking lunesta, dont drive or operate machinery until you feel fully awake. Walking, eating,riving, or engaging in other activities while asleep, without remembering it the next day, have been reported. Lunesta should not be taken together with alcohol. Abnormal behaviors may include aggressiveness, agitation, hallucinations, or confusion. In depressed patients, worsening of depression, including risk of suicide, may occur. Alcohol may increase these risks. Allergic reactions such as tongue or throat swelling occur rarely and may be fatal. Side effects may include unpleasant taste, headache, dizziness, and morning drowsiness. Ask your doctor if lunesta is right for you. Then find out how to get lunesta for as low as fifteen dollars at lunesta. Com. Theres a land of restful sleep. We can help you go there on the wings of lunesta. Liz live from the floor of the New York Stock Exchange. So many different numbers here as we are bearing down on that allimportant number. We have nine minutes before the closing bell rings. Looking up about 40 points. The s p 500 up. An alltime high, the company has been one of the most watched of all time. He has been one of the most brilliant investors of our time. Someone who has watched him since he was talking about the annual shareholder meeting. It is a must read for all investors. The website gets nearly totally overwhelmed. The thing i like most is how plainspoken and honest it is and where Berkshire Hathaway is going in the future. Liz there isnt a company in the world that puts a biggest mistake in the first line of the first page and he said that we did some dumb things. One of them was buying Conoco Phillips when oil was at 147 per barrel. What were some of his dumbest moves this year, if there were any . We will probably hear about bonds issued by a Company Called Energy Future holdings. This was the largest private equity of all time. He thought about 2 billion of highyield bonds. Since then, Natural Gas Prices have been in the toilet, which has made Energy Future holdings not perform very well. He has already written off about 1. 3 billion of these bonds, my suspicion is that they are now a total loss and he could possibly talk about that. Lets go to acquisitions. 23 billion, investing in 3d capital, he never says what hes going to buy. Any clues . Something interesting that you think you may look at with this elephant gun is the target . I think is acquisitions will follow to one of two categories. One is a way to earn a better rate of return on the cash pile. The most interesting part is that he bought 9 preferred stock. 8 billion into preferred stock, yielding 9 , a much better yield than basically nothing youre getting on cash right now. That is a category one. The second is investments that absorb cash. Utilities, burlington northern, those that require cash is good but not awesome rate of return. Liz he is 82 years old. He needs that to constantly grow the company. He has said that. But what he hasnt said is who his successor is. Any chance that it would be revealed, we had columbia business school, they have found that he mentioned an insurance business. About 100 times more than everyone else in his company and he has some 75 or 80 different managers under his wing. Welcome he does work more directly, given that it is responsible for pricing an or unusual insurance risks. Certainly he has been both him and his admiration. The question is really a capital allocator and a narrow world of insurance and the question is, is that what Warren Buffett wants in his successor or someone with real operational experience running a large enterprise like matt rose at burlington northern. But he wont give us any clues. If he does, i will eat this thai honor. Liz i will watch out for ted wexler as well. He is running his stock portfolio and he has a correct sentiment. And he likes omaha as well. Thank you so much, we appreciate it. I know you will be watching the annual shareholder letter. David asman and i will have the juicy tidbits that are within it for you. Coming up, the closing bell, we are about five minutes away. Dow jones industrial of 19 points. Can we hold on to the gains we going to the the closing bell on this friday . Stay tuned, were coming right back. [ indistinct shouting ] [ indistinct shouting ] [ male annncer ] time and sales data. Splitsecond stats. [ indistinct shouting ] its so close to the options floor. [ indistinct shouting, bell dinging ]. Youll bust your brain box