Transcripts For FBC Markets Now 20140117

Going viral. That and more in this hour of markets now. Connell thank you for joining us. I am connell mcshane. Dagen mcdowell will be back on monday and we will get back to those things i talkedabout including the devil they be in a minute but we will talk the start with the markets, we see Nicole Petallides in place at the Stock Exchange. Nicole we are pushing ourselves into positive territory for the week. This week the dow is up 3 points. Right now but 52 points at this moment, up 1 3 , the nasdaq and s p the selling of quietly. We are talking fractional moves. It is expiration friday so we could see some volume and volatility today, we got in some Housing Starts numbers, nearly 10 . What is interesting is continuing to surpass analysts expectations and to summer levels so that continues to be good news ultimately. What we are seeing on the dow o jones industrial average, American Express after its earnings up 6 , chevron, exxon the best performers. On the Dow Jones Industrial average helping it along. Biggest loser in town. Connell breaking news on the heels of massive data breaches at target and markets. Startling new report, those incidents may be the tip of the iceberg. The Security Firm eyesight partnering up with the department of Homeland Security, new details of supersophisticated, and through the Retail Sector and even beyond that. For more on that we bring the eyesight chairman and ceo, to tell us this is something we have never seen before. And this has not been seen to the extent of the last few days. What is different is the scale of sophistication of the attack, not just the origin or who is being targeted, criminals up there again, creating a set of capabilities, sophisticated techniques and tactics and when they create this capability they dont want to execute against a single victim but broadly. You have the availability of core technical capabilities that you cannot go by, sold off at times in the underground market places a round world. Criminal interests can buy the core capability and advance and customize it. And a certain variation, and another variation, and largescale attack against what will likely be a large swath of retailers and merchants. Ashley connell without that, try to scare people half to death, you cant go to the store or use your credit card and losing your identity. In simple terms, is this a huge story . It is not an even market. How much of a risk is out there for regular people going shopping . I dont think we have seen this end of this. This is the tip of the iceberg in terms of how widespread these types of attacks work through the systems and but for the folks who have been publicly disclosed, they are doing the best they can. The reason the report went out is to try to give insight to potential victims, technical characteristics to look for so we can get this surface quickly and contain the losses before they spin out of control. Connell talk about technical characteristics. Russian origin in terms of that code base was sold, it can be sold any part of the world. It takes the code base and builds custom configuration and executed with a strategy to maintain persistent access in an environment so you get access to points of sales, hide somewhere where the anti virus detection routines will not find you and find yourself in a position where you can capture the data on cards in the clear before it is encrypted. That is one part of the battle. You can find credit card information and more importantly value get it out. The point of scale systems dont have arbitration past. You can walk out the door, sophistication of the attack is not just a code base. It is not necessarily russian but whoever. The breadth of the attack and sophistication is what the concern is. Connell terrific explanation and scary stuff from john waters, we appreciate that. John said it didnt necessarily matter as we follow this news whether it is coming from the russians or sold to someone else but the idea american institutions and attack come from overseas it is more a foreignpolicy issue, as we deal with these, and he is now all Fox News Contributor and joins us by telephone. What more can we do, we talk about technical issues already but Foreign Policy terms what more should we be doing to combat this . Attempts to Gain International cooperation on cybersecurity, we have to strengthen the state department. And cooperative efforts to protect cybertransactions. And Banking Systems at risk here. And everybody makes the society go, hackers can go in and 100 million accounts, the practical matter, and anyone watching this show, and Pay Attention to, check your monthly statements out if you see anything that is wrong and start reporting. And people have to be careful about the index with their information. Connell it sounds so simple, and next thing you know what happened here . You are right. It happened to more people not just because of this target story the other stories. I felt what john who was on with us, in terms of the political implications of it, it doesnt matter if this started in russia. It is a harder issued to fight politically for what is clear cut. The responsibilities global. The internet is global. There has been a dramatic shift in modern times towards all the transactions over the internet. Credit Card Companies have it easy to engage in instantaneous checking on card information and so we have a personal responsibility to check this out. And our country as the lead commercial nation in the world as the real responsibility for our own people to make sure the security of financial institutions, our individual Financial Security as we put it up on the internet is going to be protected and one of the things i think where questions have to be raised, if we know the National Security agency has the ability to listen in on car phones, to our computers, filed a keystroke, what they doing about this, what are they doing to track the movement of hackers into our u. S. Cyberspace . And the administration, up what assets are they putting to work to make sure we can protect our Financial Sector and all the other important sectors in our economy. Connell thank you for your time. Appreciate it. Brought up the nsa. In washington, cybersecurity may become a feature story the agency has to deal with but today president obama making his first formal response to outcries following the nsa documents week. He is proposing greater limits on access and telephone data and privacy safeguards for foreigners and is about to speak more about it. Rich edson following that live from the white house. Rich as for what these programs will look like that is a to a lengthy process according to Administration Officials but the president will announce a few minutes here including a review by the attorney general, National Security agency and congressional input, we dont exactly know what these programs will end pablo looking like after these reviews and what the administration and congress decides, one change that will take place, one of the more effective ones will be in the Government Official who wants to access the phone call to phone call date of the governments weeks up will have to go to a court and get a court okay in order to access that data. As for privacy concerns Going Forward the former secretary of Homeland Security says there are still significant concerns. If they were able to identify a terrorist attack they were able to prevent we would have serious questions about for the amendment, unreasonable search and seizure and Civil Liberties and privacy. The president was scheduled to speak at the top of the hour, still waiting for him at the department of justice. We will talk about the president s remarks later. We have more on exactly what he said. In terms of adding to what we are talking about, the next great threat to your personal data may be sitting in your kitchen, smart refrigerators being targeted by these spanners and prove point says smart tvs, wireless speaker systems, refrigerators are all being hit, 100,000 have been impacted. Targeted through malicious emails. Doubleedged sword. And more risk. Overlooked in the Goldman Sachs Earnings Report is how goldman was able to cut down on their labor osts. They did it by moving. We will talk about that coming up. Here is what hersheys next step is in chocolate production. 3d printers, chocolate and 3d. Another big battle brewing over those slate fees, it is all straight ahead as markets continue. Dont go away. [ chilen yelling ] [ telephone rings ] [ shirley ] edwa jones. This is shirley eaking. How may i help you . Oh hey, neill, how areou . How was the trip . [ male announcer ] with nearly 7 million investors. [ shirle] hes right here. Hold on one sec. [ malennouncer ]. Youd expect us to have a highly skilled call center. Kevin, neill holleys on line one. Ok, great. [ male announcer ] and we do. Its how edward jones makes sense of investing. Its how edward jones makes sense of investing. My dad has aor afib. Brillation, he has the most common kind. Its not causedy a heart valve problem. Dad, it says your afib puts you at 5 times greater risk of a stroke. Thats why i take warfarin every day. But it looks like maybe we should ask your doctor about pradaxa. In a clinical trial, pradaxa® Dabigatran Etexilate mesylate . Was proven superior to warfarin at reducing theri of st. And unlike warfarin, with no regular blood tests or dietary restrictions. Hey thanks for calling my doctor. Sure. Pradaxa is not for people with artificial heart valves. Dont stop taking praxa without talking to your doctor. Stopping increases your risk of stroke. Ask your doctor if you need to stop pradaxa before surgery or a medical or dental procedure. Pradaxa can cause serious, sometimes fatal, bleeding. Dont take pradaxa if you have abnormal bleeding or have had a heart valve replaced. Seek immediate medical care for unexpected signs of bleeding, like unusual bruising. Pradaxa may increase your bleeding risk if youre 75 or older, have a bleeding condition or stomach ulcer, take aspirin, nsaids, or blood thinners. Or if you have kidney problems, especially if you take certain medicines. Tell your doctors about all medicines you take. Pradaxa side effects include indigestion, stomach pain, upset, or burning. If you or someone you love has afib not caused by a heart valve problem. Ask your doctor about reducing the risk of stroke with pradaxa. Connell as we come back on markets now we talk about Housing Starts numbers in december snow Nicole Petallides looks at the home builders. Nicole we got these numbers for Housing Starts and Building Permits and Housing Starts were down about 10 relatively and that sounds terrible, seems to be good news, exceeded analysts estimates. And relative to the summer still above the summer levels. The stock, and the downside the lead the r horton down 11 4 , leonard, pulte, you get those here, all these stocks the down 1 , 2 , they look at the group overall, here is a longerterm chart of pulte group, when you look at it, very telling. Over 52 weeks most of these stocks up 1 , 2 , the peak for these guys was may, june of last summer. That is why you see the peak and the dropoff, most of them look exactly like that. Since then they havent done so much. Connell the markets are up today, 50. The Global Market check with the european markets up sharply for the day of the weekend if you look at those markets, put the 100 by 0. 1 and cac 40 in paris and the german dax at the bottom of the screen up today by 1 1 . Google, this is tomorrows business today, developing smart contact lenses specifically designed to help diabetic so lenses will monitor glucose levels and allow diabetics to skip the fingerprint blood tests they have to do and the earth in antennas on those, flexible sense is between two thin layers of the top lens, monitor the glucose levels, through the users tears. The best part, the levels are transmitted to the users smart phone from the antenna. This is a use of technology. The bad news is itll be another five years to reach consumers with this product with the stock price up for a look at google up 1. 82 today. By now if you follow the banks and follow wall street you might know that Goldman Sachs posted a profit of 2 billion in the fourth quarter. That was the report yesterday. What you may not know is some of the success at goldman is due to lower compensation costs. Interesting the way they saved on compensation. Goldman quietly has been moving employees out of big cities like new york, london and moving out of london and moving them into lessexpensive cities, salt lake city, utah is one example. Is this a trend . Something we will talk with other while street firms, goldman up 1. 92. The fight over debit card processing fees is hitting, merchants are going toe to toe with the fed. Markets now continues and you have seen this on the internet. Look out. Taking the internet by storm. The creators coming on as well. This form of marketing, mass currency naturally. And the euro at 1. 35. We will be back on markets now. Dont go away . 23 minutes past the hour, this is your fox news minute. Firefighters in california continuing to battle a ferocious wildfire burning outside los angeles. Officials are saying the winds are dying down, the threat slowly subsiding but the flames of already destroyed several homes and forced thousands to evacuate. Police are arresting three people that they believe started the blaze with an illegal camp fire. Overseas peace talks but the situation inside syria next week. Opposition leaders meeting to decide whether to participate in the United Nations calls on Syrian Refugees trying to escape the three year civil war. U. S. Senator tom coburn is announcing he will retire at the end of the current session stepping down next january two years for his term is scheduled to end. He was diagnosed with a recurrence of Prostate Cancer but he says that is not the reason for the early retirement. Those are your headlines at this hour. Connell good to see you. Back to washington d. C. The other thing, the battle between merchants and the petter reserve of the debit card processing fees continues and peter barnes is live from the court of appeals. This is a multibilliondollar battle between big banks, retailers and the Federal Reserve caught in the middle. In 2010 it passed legislation, the fed to set reasonable and proportional fees that banks charge retailers for credit Card Transactions, when you go to 711 or starbucks, to buy your coffee. When this started these fees averaged 0. 44 per transaction. But that in 2011, at 0. 21 per o transaction, retailers sued the fed saying it had improperly interpreted the law and said the swiped fees should have been capped at 0. 12 per transaction. This all adds up considering there are nearly 50 billion of these debit Card Transactions the year now and the banks use to take in 16 billion a year in revenue from swiped fees, now they are taking in about half that and they are siding with the fed because they dont want to see the retailers for even lower. Retailers won the first round of this plate in District Court last year agreeing with retailers that the fed misinterpreted the law, the fed appealed and today lawyers for retailers were asking the Appeals Court to uphold the District Court decision. Questions from the three judge panel were tough on the retailerss arguments and supportive of the fed which they had discretion setting these fees. This could go to the supreme court. Connell big money story, thank you for personalizing that with the starbucks reference. Big imus in the morning viewer in the morning. 3d printing comings to a can the aisle near you. Hershey jumping on the 3d printing band wagon. Joe says it is another reason he is interested in that sector. The Marketing Campaign everyone is talking about. The devil made me double baby. They have planned next. [ me announcer ] this is the story of the dusty basement at 06 35th street the old dining table at 25th and hoffman. And theittle room above the strip mall f rle avenue. This magic momt it is the sto of where every great idea begins. And of those o believed they had the power to do more. Dell is honored to be part of some of the worldgreat stories. That began much the same w ours did. In a little dorm room 2713. This magic moment 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. 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Tdd 18888522134 so you can take charge tdd 18888522134 of your trading. Connell we are ack on markets now. I know you have all stuck around to see this double baby. Lets go to Nicole Petallides. Nicole i saw a picture of it on the new york post. I was a little scared. Twitter today doing very well. They put a buy rating. Seventyfive dollar price target. They are working with a payment process. We will see. This is all about ecommerce. It will be an interesting move for the company overall. Here is a onemonth chart for you. We are back above 64. Back to youu connell we will make you wait a little bit for this devil baby. We will talk about hershey. It is joining 3d systems. From Emerald Asset Management is joe. Do you like this one . We like 3d systems. I want to do this for you. I am only about 2 miles, 3 miles from hershey where we are broadcasting from right now. You can take it into an edible Something Like this. It is an eagles helmet. Connell we know you are a big eagle fan. You can put that on a cake or anything. You have seen the show cake boss. They can take this kind of technology and deploy it across all kinds of Tech Knowledge ease. We Like Companies like 3d systems although we do not own a lot of it. It is increasing the productivity of these companies. Much like robotics does in general. I like the robotics field. We have talked about it before. It does scanning. 3d scanning. You need to scan to make sure that you can do the 3d printing. All right. In all cases. It is called metrology. There is a leader in that space. I just think a company like pharaoh, faro. They are doing a pretty good job of lumping that together. Connell everone can see the disclosures across the bottom of the screen. When you go out to these companies, i think it is interesting today. The nsa speech is going on right now. When you go to these companies, what are you noticing . A lot of them are big tech companies. Are they ready for that . You and i have talked about this for a number of years now. I think the Cyber Security place i will continue to look at it. No, i do not believe that the cloud is totally safe. I do think Certain Companies and the types of companies i actually thinks it gives Smaller Companies that we look at it like an advantage. The big banks, they have a lot of moving parts. They can protect. Connell it is intuitive. If you do not have as much to attack, it is easier. I like regional banks. We do extremely well. Inside of that, you know, our team, they have seen over 400 banks over the last two and a half years. The people are going for the big banks. What i am telling you is, i have talked to businessman who say they feel much more comfortable from a security standpoint. Like i said, that is not the only reason. We think community and regional banking is a great place to be. I am a little worried about the overall market. I think one of the problems i am seeing is people are buying what they do not know. You really need to know your companies. I would urge people, just do not buy something because someone tells you it is a good thing. Go do a little homework. I think in this market, you could get burned. Connell they are right next to hersheys. What are you doing . Of course, i own it. They will make a laser printer. connell thank you, joe. Eating a football helmet in pennsylvania. President obama addressing a makeover for the phone data program. The devil is also coming up. Terrorizing people in our office. Look at dennis. He has no idea. Pretty clean office he has there. [ male announcer ] e new new york is open. Open to innovation. Open to ambition. Open to boldids. Thats why n 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. We new york. If theres something and ows more businesses. Were open to it. Start a taxfree business at startupny. Com. I am lori rothman with your fox business brief. The largest percentage the client since april. Activity came in at 986,000. Down 3 since november. Target will open its smallest store ever. It is called target express. It will be about one quarter of the size of current city stores. Factory output increase for a fifth straight month. That is the latest from the Fox Business Network. Giving you the power to prosper. [ female announcer ] who are we . We are thinker the job jugglers. The up allnhts. And the onesho turn ideas into action. Weve made our passions our lifes work. We strive for the moments where we can s, 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. Its not the fumbling around with rotating categories card. Its not the etting blindsided by limits card. Its the nogameplaying, noearninglimithaving, deepombthrowing, givemetheballandilltake ittothehouse, cash back card. This is the quicksilver cash card from capital one. Unlimited 1. 5 cash back on every purchase, everywhere, every single day. So let me ask you. Ats in your wallet . Connell breaking news out of washington. President obama was talking about the changes he has planned. I will not dwell on mr. Snowden actions or his motivations. I will say that our Nations Defense depends in part on the fidelity of those who trusted what our nation seeks. If any individual who objects to government policy can take ii into their own hands to publicly disclose classified information, then we will not be able to keep our people safe. Connell we are joined now by jerry smith. Before i ask you a question or two about the specifics of what the president is proposing, the idea that he has to address this issue largely because of the leaks of edward snowden, is the country better or worse off, do you think . Much worse off. One of the things most striking about snowden is he released the domestic programs, he also relist damaging information that has nothing to do with privacy rights on americans. I think part of the discussion that has not been had is how damaging his mistakes have been. Connell we have learned that there may be more. With that said, let me ask about the specific changes that the president is proposing. The president has talked about and i think he made reference to the importance of having, obviously, some level of secrecy for our agencies. Do you think he is getting it right . I actually do not think that he is getting the balance right. Both the congressional committees, courts, the president s own panel that looked into these matters discovered no wrongdoing by nsa when it comes to the collection of this data. The president is running around making very large changes to the Program Based on a problem that frankly no one has identified. Tell me what the changes are that you are most concerned about, as opposed to just cosmetic changes or big statements that do not go along with changes that make people think he is addressing this. The two that are on the metadata and collection program, the first one is for every query of a telephone number, the Justice Department will have to go back and asked for permission. Right now, if they have a number from a terrorist organization, there is a call that comes into the u. S. , nsa is allowed to look at that, the number that they are calling and also who else that number may be calling. The process will be much more cumbersome and slow. You have to wonder whether or not it will be utilized in a way that will be effective. The second thing is the president is moving the actual storage of the material away from nsa two another entity. He asked attorney general and the director of National Intelligence to come back and give him ideas about where the storage may take lace. Again, the reason why he does not have connell gary schmitt, thank you. Lets get to sandra smith in the markets. Treasuries on a hot streak this month. Sandra we will see if we can get a five ten year. The big change is the fact that we are seeing the treasury market outperforming stocks. Here we have the 10yearold yield. Right now, about the lowest that we have seen it in a month. Theyre called into question the strength of the rally. By the way, the yield on the twoyear, if we can show that as well, it has now narrowed it to the narrowest it has been in the past seven weeks. Sorry we do not have all of these elements for you. Expect some movement in the bond mmrket. Everyone will be looking at what is said about the fed tapering program. Connell we trust you, sandra. It is called the devil baby. [ cellphones beeping ] [ cellphone ris ] hello . [ male announcer ] over 12,000 financial advisors. Good, good. Good over 700 billion dollars in assets under care. Let meust put this away. [ male aouncer ] how did edward jones get so big . Could you u teach kids that trick . [ male announcer ] by not acting that way. Ok, st quarter. [ male announcer ] its how edward jones makes sense of investing. Connell the moment we have all been waiting for. The most shared video in the world these days. The devil baby. Connell we are happy to do this. Their creators are here in studio. Look at that. It is interesting for a number of reasons. You are controlling that right now. You must love sneaking up on people. his idea came to you where . In a dream . We take commercial ideas and turn them into news and pop culture stories. We thought what is the coolest way that we can promote the movie devil two . Speak. There is too many ways to promote a movie. Do you purposefully, do you make this viral on purpose . Is there a formula for doing that . We have been doing this for a while now. Is there like a metric that you do . It has to be a really catchy idea. It is easy to share. It needs to be entirely entertaining. Connell is has gone flat. What is the difference in this case . We pretty much hit home runs every time. If michael and i do not feel like something has viral dna, we will not take the project. If we can come up with one original idea that we have done, often times we can build a proper around it. Number three is it has never been done before. Connell give me this lori rothman video. She was just on doing the news update. She saw it coming. The Office Looks Like it has not been cleaned and 25 years. Look at dennis. He is coming on next, by the way. [laughter] that is rude. Connell they are all over the streets of new york. Can you just use that . How does it work . It is peoples reactions that ultimately sell our videos. We have a bidding process in which we alert people. If they agree, they get the hell scared out of them. There is one little layer of protection. Connell what is next for you too . This was a lot of fun. The babys name is neil, by the way. Connell james and michael, thank you very much. And baby neil. [laughter] connell Dennis Kneale is coming on with cheryl casone. They have an exclusive interview. It is with ibm. We have that, new Home Construction and the best year since 2007. They will break that down. It is coming up and coming back in just a moment. [ tires reech ] chewleys finds itself in a sticky situation today after recalling its new gum. [ male announcer ] stick it to the market before you get stuck. Get the most extensive charting wherever y are with the mobile trader app from td ameritrade. The bottom line is that people around the world, regardless of their nationality, should know that the United States is not spying on ordinary people that do not threaten our security. Dennis president obama gives a major address on balancing the needs on National Security against the needs we have on private security. I am Dennis Kneale with cheryl casone. December housing meantime finishing up for the strongest year of home building. Our next guest says it is not enough. Talk about betting big on solar. The Obama Administration will be we have a ceo says the industry is better off without the government large. All of this and more on this hour of markets now. Cheryl, good to have the dow finished the first up week since the beginning of the year. Cheryl it is the top of the hour now. Stocks now and every 15 minutes. Talk about this. Nicole it has been somewhat mixed. The dow right now is higher. The nasdaq and s p are pulling back. We have a winning week on wall street. With that being said, we have some names under some pressure. Ge also a leg or after its numbers. Housing back 10 in the latest report. However, it actually be expectations. Everything seems to have a mixed connotation with it. There is the s p 500. Down 1. 5 points. We have some records in this new year. As we noted, some good news, some tough news. We have some highs as well. It really is an interesting day. Cheryl we will be talking about the housing numbers coming up in just a moment. Thank you very much. President obama making his first formal response following the outcries of the nsa weeks. Rich edson is live at the white house with more. The president taking a long time today to cover a topic that has been a big problem for his administration. This is what the president has announced here. They will now need a court order to access that bulk data. Also a dozen leaders will now be exempt from spying. Currently, it is at the nsa. It could be at the actual phone company. These recommendations, by Congress Looking for info from the National Security apparatus and also the attorney generals office, those recommendations will be due in the next 60 days. The president contends that they are not abusing their authority. What i did not do is stop these programs wholesale. Not only because i felt that they made us more secure, but also because nothing in that initial review and nothing that i have learned since indicated that our Intelligence Community has sought to violate the law or cavalier about the Civil Liberties of their fellow citizens. The president said that he wants to promote a panel of advocates to go observe those courts to make sure the privacy interests are being observed from those outside the government. That to you. Cheryl rich edson. Thank you very much. Dennis more than half of americans disapprove of president obamas handling of the nsa scandal fallout. My next guest worries that in this backlash, the Obama Administration may go too far. Maybe it is time to modernize. What does he mean by that . Lets ask him. He is a former security advisor to the vice president. Thank you for being with us. First of all, what do you think of the president s remarks today and what kind of threat do they pose to our antiterror efforts. I think the president gave a lot of information. It will take a while to unpack. The highlights are when it comes to surveillance, it seems to pull back what we tend together when observing foreign leaders and gave a very under finding scope of who would be covered by extending privacy coverage. Something that really is unprecedented. When it comes to the problems at home, i think he is getting closer to identifying real problems here according to the fourth amendment. Dennis right. Why would we pull back n Foreign Surveillance at all . It is allowed in legal. That is absolutely true. It is basically a political reaction to what i think foreign leaders dont know they are being monitored. No one has the expectation overseas of that kind of privacy. It was basically a political reaction. The europeans, the russians and the chinese will not pull back from surveying our leaders. Dennis inset of collecting every phone call records, every email here in the u. S. , why dont they sort of do the surveillance overseas . Why the huge that that the nsa should cast that you must be in favor of . It is not that i am in favor of it. They have outpaced the prophecies of the past and the law of the past. It used to be when we were collecting data on overseas targets, sometimes they would be speaking on the other end of the conversation. That person could be anywhere in the world and we may not know it is a u. S. Citizen until later. Over time, phone companies begin to have huge databases of information. They may request that information. It is one thing to react to a major attack like 9 11 and trying to cast the net life. Decades later, maybe we need to dial that aperture back. Dennis you say that you believe the fourth protection, that they need to be modernized to take these changes into account. First of all, dont mess with the bill of rights and the constitution. Do you been modernized so that people have less rights to privacy . Less protection . People put so much of their private information on to the internet and to cellular networks. Big companies are gathering a lot of this data into the government is going to those companies and getting it. No one can go through and itunes agreement knowing what they are giving up when they say yes to download. Dennis one last thing, why not just have the government monitor all the publicly available facebook posts and twitter. There is plenty of explicit statements of things to worry about right there. That is not violating anyones privacy to look at public statements. That is right. There is no llgal basis for the nsa to be monitoring your phone calls or mind unless we happen to be talking with a known person in al qaeda. They dont watch Youtube Channels that are out there for everybody. Dennis thanks. Thank you. Cheryl groundbreaking on new Home Construction falling in the month of december after hitting a high just the month prior. It is well below. We have the ceo of United Development funding. Welcome to you. 3 you are saying we need to be over 1 million. We are far from that number for right now. I think when you look at the numbers that we see, you have to remember that this is an upward sloping lshaped recovery. The primary reason for that is it has been driven by bernanke. What we really need is jobs, jobs, jobs. Jobs really drive household formation. People forming families as spending money and buying homes. Cheryl it does. Let me go back to your point about bernanke. He has kept Interest Rates nice and low. That has been a boon to the homebuilders and the Housing Market. Builders have come on the show and told me that these builders cannot get financing and that is where the problem is. Do you agree or disagree . That is an issue. Certainly providing capital and access to capital, particularly for the region homebuilders different from what the public homebuilders, public old holders have access to capital. It is not being engaged in the process. I will tell you that 2013 is the strongest homebuilding year that we have had since the financial crisis, since 2007. We will improve year over year. You will see the red state phenomenon. Cheryl lets look at that. I want to show our viewers something. That is where we are seeing stronger job growth. These are red states. Especially, texas and florida where we are seeing a large number of job growth. Is that how you are investing . We just followed the numbers. A Business Model in housing and housing finance, you want to be in markets where home prices are affordable, they are stable, you have demand fundamentals that are strong which is job creation and house formation. When people have jobs and their wages are increasing, Consumer Sentiment is higher. Cheryl florida, texas and the carolinas. There is also a lot of promise in markets like phoenix. What i dont understand here is why we are not seeing housing stronger. We are far below on a national level. Yes. On the other side of that number, you will see the west, which will be your phoenix, las vegas and california. It is only accounting for 15 of our Housing Starts. You will tie it back to jobs. Also, you will tie it back to the housing bubble. That is the areas where you overbuilt. Where you had this disruption of Household Net Worth where you had a deterioration in not only the job market, but Consumer Sentiment. In those parts of the country, which are generally a large contributor to housing are not healthy, are not able to purchase houses in the manner that they should be. Cheryl a lot of investors have been. Let the flipping begin. Thank you very much. I hope to see that 1. 1 million on housing start at one point. Dennis this state is climbing up the ladder. Cheryl making millions to spending billions. Betting big on the cloud. We have an exclusive interview coming up. Lets take a look at the energy markets. All youll 94. 53. We will be right back. Welcome bac how is everything . . Theres nothing like being your own boss and customers are really liking your flat rate shipping. Fedex one rate. Really makes my life easier. Maybe a promotio is in orde good news. I got a new title. And a raise . Management couldnt make that happen. [ male announcer ] introducing fex one rate. Simple, flat rate shipping with the reliability of fedex. Over the pizza place on Chestnut Street the modest first floor bedroom in tallinn, estonia and the southbound bus barreli down i95. This magic moment it is the story of where every great idea begins. And of those who believed they had thpower to do more. Dell is honored to be part of some of the worlds greattories. That began much the same way ours did in a little dorm room 2713. This magic moment cheryl the dow. We just finished the week. We finally have Morgan Stanley this morning. Some coming out with strong quarterly reports. Goldman sachs came out this week. They did well. Citigroup, kind of the Problematic Bank this week. Keep an eye on this sector. The Financial Sector as we go into the rest of the trading day. Time for stocks now as we do every 15 minutes. I thought there was some fascinating news on ups. Now the stock is taking a big hit. Nicole the financials are important. It can be an economic indicator. Ups is down 1. 5 right now at 98. 91. You talk about the weather. They did ship a Record Number of packages going into christmas, but it was the flurry of late orders and late requirements for shipping and tell whether that implement whether that they had to battle and in some cases where they did not meet their expectations. With that they have had to lower their guidance for the year 2013. Back to you. Cheryl look at fedex as well. Trading down. The cool, thank you. Lori a shift across the nation. According to Phoenix Marketing international. That is one in every 20 households. North dakota making a big jump. 2013, it moves up 14 spots. Maryland sitting in the top spot since 2006. New jersey, connecticut, hawaii also on the top of the list. Cheryl the battle over debit card fees is also heating up. Dennis ive got a beef with beef. Prices are heading up in the coming months. [ male announcer ] e new new york is open. Open to innovation. Open to ambition. Openo boldids. Thats why n 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 axes for ten years. Were new york. If theres something that creates more jobs, and ows more businesses. Were open to it. Start a taxfree business at startupny. Com. [ male announcer ] wt kind of energy is so abdant, it can help provide the power for all th natural gas. More than ever before, americas electricity isgenerad by it. Exnmobil uses advanced visualization and Drilling Technologies to produce natural gas. Powering our lives. While reducing emissions by up to 60 . Energy lives here 23 minutes past the hour right now. Hi, everyone. I am jamie colby. Washington has agreed to send arms to iraq. They are growing more desperate. The Prime Minister has made an urgent request for the u. S. To provide new weapons and training to help beat back the terrorist. There are new elements concerning the George Washington bridge scandal. Under jersey state legislative committee issuing subpoenas for 17 people and three organizations as they try to get to the bottom of who ordered the lane closures. South korea is planning to call over 20,000 ducks over bird flu. A farm about 200 miles from seoul that is likely contaminated with the virus. Those are your headlines at this hour. I am jamie colby. Back to dennis and cheryl. Dennis it is time to make money with charles payne. He is looking at apollo education group. Charles you pull out the chart. These stocks got hammered. The administration sort of went after them. There were questions over funding and reimbursement. Now we are really starting to see a real inflection point. Business is really starting to turn around for them. With apollo, we saw it three quarters ago where they hit a bottom and now they are starting to edge higher and higher. Pricing power is starting to come back. The masters degree, they were able to get more for those. What we are seeing is fiscal year 2014, the street is looking for 2. 24, for this year, just three months ago it was a dollar 77. Three months ago, it was 1. 29. These companies are starting to expand very quickly. Charles the job openings came in at a multi year high. 1. 8 Million People quit their jobs. Dennis is that up or down . Charles the highest number since 2008. It bodes well for these kinds of colleges. I like it a lot. Cheryl big lou with its head in the clouds. We have an exclusive interview. Dennis lions gate firm films. Look out. Robert redford blaming the fill for the oscar snub. Lets take a look at some of todays winners and losers on the s p. My dad has aor afib. Brillation, he has the most common kind. Ts not caused by a heart valve problem. Dad, it says your afib puts you at 5 times greater risk of a stroke. Thats why i take my warfarin every day. But it lks like maybe we should ask your doctor about pradaxa. In a clinical trial, pradaxa® Dabigatran Etexilate mesylate . Was proven superior to warfarin at reducing the risk of stroke. And unlike warfarin, with no regular blood tests or dietary restrictions. Hey thanks for calling my doctor. Sure. Pradaxa is not f people with artificial heart valves. Dont stop taking pradaxa without talking to your doctor. Stopping increases your risk of stroke. Ask your doctor if you need to stop pradaxa before surgery or a medical or dental procedure. Pradaxa can cause serious, sometimes fatal, bleeding. Dont take pradaxa if you have abnormal bleeding or have had a heart valve replaced. Seek immediate medical care for expected signs of bleeding, like unusual bruising. Pradaxa may increase your bleeding sk if youre 75 or older, have a bleeding condition or stomach ulcer, take aspirin, nsaids, or blood thinners. Or if you have kidney problems, especially if yotake certain medicines. Tell your doctors about all medicines you take. Pradaxa side effects include indigestion, stomach pain, upset, or burning. If you or someone you love has afib not caused by a heart valve problem. Ask your doctor about reducing the risk of stroke with pradaxa. Whatswithout the thinking capitathat makes it real . Whats a vision without the expertise to execute it. And the financing to make it grow . Whatever your goal, it can change more than your business. Whatever your goal, it can change e future. Thats wh at barclays, our ambition is to alys realize yours. If your denture moves, it can irritate your gums. Try fixodent plus gum care. It helps stop denture movement and prevents gum irritation. Fixodent. And forget it. Ibm bidding begun cloud services, we talk to the ceo of the company ibm acquired to boost its efforts in the cloud. The battle between merchant class and the Federal Reserve over debit visas heating up again. And an entrepreneur wants to put government out of the solar energy industry. Lets go to the floor of the nyse and Nicole Petallides making big moves today. Nicole a lot of names on the move, whether it is earnings for news, up lets baying for some of these, google hitting a new alltime high today on the same day they are Testing New Technology where it actually has a writer chip by your eye and can determine glucose levels for diabetics. That is the name we are watching. Best buy under pressure, 30 , American Express, Morgan Stanley in new highs, ge and ups to the downside. Positive comments from alan jumming over 10 today for gamemaker that is a real winner. Twitter is gaining and bouncing back. As i noticed earlier, it is of very busy day on wall street. Dennis thank you. Cheryl ibm has its head in the clouds. Big blue snapped up Cloud Computing co. Software for 2 billion and has plans to achieve cloud dominance, 1. 2 billion to expand. The ceo joins me now in a fox business exclusive. Welcome, we are glad you are here. Big news last night, one analyst saying, quote, this is a radical Expansion Plan for ibm. I know you talked to the ceo of ibm region yet constantly, why now . This is an important time. On 1. 2 billion commitment from ibm to expand software services, a cloud component of ibm and this is money we will spend this year and next year we have 40 locations so customers can buy on demand cloud services. Cheryl data centers are expanding this, we meet this expansion around the world. Terrorism expansion in the u. S. Job creation, it a lot of competition in this space and you have been on record with the New York Times saying you are ten years ahead amazon in this deal but amazon, google, microsoft are ahead of you in that they have been working on this technology longer than you have. How do you respond . Software was born in may of 2005 i year before any of the other competitors came to market. We were built differently, we have been since day 1 catering to the enterprise grade internet scale audience, we knew compliance, control, transparency was going to be an issue for largescale customers and that is how they build the platform, our platform works in a shared and dedicated environment so our customers and single tendons your multi tendency and it is just a different product from what the mass cloud posters are doing out there. This is a different product targeted to ibms core Customer Base and targeted to softwares Customer Base which is the Internet Center Customer Companies that have literally grown in to make the giants overnight. Cheryl talk about some of those names. Yelp is one of those customers, tumbler and things like that. To do you think is going to be the biggest customer for you in 2014 . We have all kinds of customers. If you look at social networking, social gaming, iphone, android apps most of the Larger Properties are on the Software Platform because of scaleability and performance and the network can be a pee ay that they have control. When you have yelp and open table and tumbler and drop box and all the names youre seeing tremendous growth from growing on the Software Platform. Cheryl this is a hot topic on the heels of data breach that is expanding with target and market and the president talking about is a surveillance today, all of this in the world of businesses like yourself trying to increase activity on the cloud for 85 of business on the clout how big of a concern is security to you as you move forward 2. 2 billion in this expansion . It is a huge concern for her customers but we build the transparencies inside software. You can look inside out and see what is going on like you can see in your own data centers so we give customers that look and feel and comfort that they have in their data centers we have the same technology they are using internally, firewalls, those types of things. Cheryl you are not worried this code that broke into the retailers, software that was made six months ago and sold in the black market, we didnt even know about it until yesterday when it was called, you felt you were ahead of that curve . Ibm is the most trusted brand in the world and we did that from our actions over the last 100 years, hyperfocused on security we will always be there. Cheryl this is the big business, thanks very much, ceo of software. Dennis the first battle between merchants and the Federal Reserve over debit card processing fees continuing today. Peter barnes live from the court of appeals in d. C. Peter that is right. Multibilliondollar legal battle between banks, retailers and the Federal Reserve caught in the middle. This case comes down to what congress meant when in 2010 it passed legislation ordering the fed to set, quote, reasonable and proportional fees banks could charge retailers for the big Card Transactions. When this got started the fees averaged 0. 44 a transaction. The fed kept them to 0. 21 per transaction in 2011, retailers sued the fed saying it improperly followed the law and said the fees should be capped at 0. 12 per transaction. All of this adds up to billions because there are 50 billion but Card Transactions a year these days. Banks use to take in 16 billion a year in these white fee revenues, now theyre taking in half of that. They are siding with the fed in its battle. They dont want these fees to go lower but retailers won the first round of this fight last year in the District Court in d. C. The had appealed and retailers, lawyers for retailers were arguing that the Appeals Court should uphold the District Court decision against the fed but i got to tell you that judges here very critical of the retailers argument. At one point one of the judges told one of the lawyers for the retailers, stop wasting everybodys time on one of the arguments about what costs to include on these fees. And in your fried a media minute, is a charter fighting off more than it can chew, new reports have charter asking no. One cable giant comcast to join a bid for Time Warner Cable. Here is one reason why. A whole lot of that going on. Combine charter, at Time Warner Cable would have over 60 billion in debt. Companies in diaz and the 500 have an average of 1. 36 in debt for every dollar they have in net worth, but 376 in debt for every dollar in equity, charter 23,000 in debt for every equity dollar. The oscars day 2, how can hollywood snub tom hanks, Oprah Winfrey and robert redford, lions gate after getting overlooked for his flick about an old man and the c. He cites lion gates peony distribution nevermind that his is the only character in the film and the character barely says a word of dialogue. The nfl network in retreat, an exclusive package of thursday night games. Putting the package of for a bid by the big boys. Espn etc. Cheryl diet soda affecting your diet. Dennis one Green Energy Entrepreneur why government needs to stay out of business even the government paid out 100 billion in subsidies to it. [ chilen yelling ] [ telephone rings ] [ shirley ] edwa jones. This is shirley eaki. How may i help you . Oh hey, neill, how areou . How was the trip . [ male announcer ] with nearly 7 million investors. [ shirle] hes right here. Hold on one sec. Malennouncer ]. Youd expect us to have a highly skilledall center. Kevin, neill holleys on line one. Ok, great. [ male announcer ] and we do. Its how edward jones makes sense of investing. Tracy byrnes with your fox business brief. Consumer sentiment switch to this month to preliminary reading of 80. 4 and that is down from the final december number of 82. 5. Thompson Reuters University of michigan index found many lowincome households were concerned about the economy and job prospects. Employers advertise more jobs in november, the most in 5. 5 years, the department as job openings jumped 120 from october to 4 million. More workers quit their jobs in november. The numbers increase 1. 9 to 2. 4 Million People. The increase for a fifth straight month in december the Federal Reserve says Factory Production rose 0. 4 last month from november. That is the latest from the Fox Business Network giving you the power to prosper. Dennis solar stocks rebounding in 2013 getting past the big backlash of failed Government Investment by solyndra. Our next guest is this recovery and soldiers on the street grooves government ought to stay out of the Renewable Energy industry. Senators and founder and green and john or jigger shot joins us now. I got to ask for a small boy stocks rising, really nice recovery, isnt that as much because of the government grant and the hope the government money is flooding in rather than in pursuit of actual real profits . Exactly the opposite. In 2013 the government scaled down its investment in solar. California got rid of solar subsidies but a lot of investors are saying maybe these guys can survive without subsidies and that is why the stock prices are up. People seeing light at the end of the tunnel. Dennis stocks showing during this segment are the ones that are up so nicely, most of them have gone government grants a government guaranteed loans. First solar, power, solar city. If the government is going to give out free money and you are a capitalist you will take that free money but that doesnt mean we need that free money and that is why i have argued we should actually phase out all of these subsidies like the oil and gas guys faith out their stuff. Dennis the number of oil and gas, huge, hundreds of billions of dollars energy, a couple billion dollars, the Obama Administration, 150 billion into alternative energy barely showing up yet, solar is the leading alternate supply, what percentage of energy base is solar now . Today in the United States it is 1 but it is growing exponentially so this last year in 2013 solar wws the largest addition to the u. S. Grid bigger than natural gas, bigger the nuclear, the given new coal. Dennis bringing up to 1 , that is not going to solve whatever Energy Crisis we face. Why not instead invest in private efforts to fix some of the Carbon Emissions stuff . Theyre doing that too. The problem is every time people say it is five years away five years does by and it is another five years with. I think they should keep researching carbon captor and storage, may be in oil recovery where it takes a ceo to end of the into the ground and get more oil out but in the meantime today, walmart is the largest user of solar power in the United States and they are not doing that because there green, theyre doing it to save money and prevent their electricity bills from going. Dennis that is the key. If we could find a profit motive we will solve a lot of things and cutback a lot faster. In 2012 by road dropped the 20 year lows in Carbon Emissions in the u. S. Chipping from coal to natural gas because the price was better. The government grants flooding into solar it did distort the market so that wrong ideas that back because they had more Government Support and better ideas elsewhere . Absolutely. The doesnt the government doesnt do a good job picking winners and losers on the corporate side with oil and gas credits, with intangible drilling credits the government is better by saying if you do something we will give you a tax credit or what not but even those are getting phased out. Got wind one was that is out last year and sold one will be phased out in 2016. Dennis with it never needed to begin with or does it mean the government has done an excellent job and now we are ready to move on without government . It is hard for me to say in the past but when you look at governments real role, basic r d, figuring out to invest in new ideas and new technology but also in scale up. When you think about Technology Like solar, the reason we have lost 80 of our cost, it is gone80 in cost because we scaled this thing up to being the largest power sector of business in the world, 100 billion. Dennis they did very little in the way of basic research, and battery co. And a car company, that is basic research. What they did do with that money is did Loan Guarantees for large utility scale project, bank of america was not willing to provide money without the Loan Guarantee, they dont need the guarantees, you have yields that have gone public, con edison taking their yield public. Dennis the take away is if you require government subsidy to get a Loan Guarantee maybe it is not good enough business and private money. We will leave it there. Thanks so much for being with us today. Cheryl supplies tighten across the country and phil flynn, somebody i know, like it, standing by at the cme. What do you make of this . I tell you right now what the futures markets are saying. High prices have consequences. Even though on the front end of the curve, the front couple months pushing towards record highs, right now retailers are trying to gamble to meet demand but because of the price spike we will see it dropped dramatically in coming months. They are betting right now that consumers are going to be resistant to higher prices for beef. Was good to the underside of the equation and look at the bond market which is benefiting right now. In the short term the pork market is very well supplied. Hogs than coming in to market are very heavy, they are going to the market but theyre betting the exact opposite. If you go down the curve prices are sharply higher so cattle prices in the future should come down and demand will change and it takes its toll. Cheryl phil flynn, thank you, have a great weekend. Is time for your west coast minute. Some new details about the wild fire in los angeles. This will still fox news 1700 acres of burned so far. The fires only 30 contained with 1200 firefighters on the scene, 2,000 people have been evacuated so far and the governor declared a state of emergency. Alaska is ready to free up natural gas to asia. They will build an 800 mile pipeline from alaskas slope to an expert facility. The project could cost 65 biilion and could also take years to complete but look at exxon and conoco phillips, stocks trading higher day. Finally a california woman wearing google glass has been found not guilty of distracted driving charges. The lead to be the first driver in the nation, and in the glass, driving, we will see what that is about across the country. Take a look at google. Here is the stock down 0. 06. Dennis more bad news for the soda industry and the rotund among us, put down that can of diet coke and other zero calory electrics. 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. Dennis google developing smart contact lenses for diabetics. They will monitor glucose will allowing diabetics to skip the finger prick blood test, hair thin and and and flexible centers embedded between two sin levels, and the users smart phone. The bad news google says it will be five years before the product will reach consumers, no telling how long before the contact lens, and moving almost lower. Cheryl a new study by Johns Hopkins Bloomberg School of public health, a hobbes diet soda drinkers consume more calories than those who drink regular soda. The researchers believe artificial sweeteners that Debate Centers in the brain which influence the persons appetite, the healthier beverage, drinkers of diet soda take in more calories from solid food in meals and snacks, 20 present of u. S. Adults drink diet soft drinks. Revenues if you love your diet coke. Creators of the devil baby coming here to talk about the new Marketing Campaign. Before the baby in the studio, a few offices to pay visit including surprise visits to this guy. Look familiar . Ha ha crazy. Get that thing out of here. Project will vomiting. Cheryl wasnt sure who was screaming more, you or the baby in that last moment . Dennis it was me. Cheryl the number one shared internet video in the world right now. Dennis metaphor of anxiety for new parents. Cheryl it doesnt end at target unfortunately. We have the latest developments for you as we learn there are six on going attacks happening on retailers, and the software that continues to have credit card Processing Systems out there. Dennis realestate shopping may be here, ceo pete bullets with how to find your dream home when sitting on the sofa. [ male announcer ] once, there was a man who found a magic sshell. It told him what was happening on the tradg 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. Of the dusty basement at 06 35th stet the old dining table at 25th and hoffman. And theittle room above the strip mall f roble avenue. This magic momt it is the story of where every great idea begins. And of those o believed they had the power to do more. Dell is honored to be part of some of the worldgreat stories. That began much the same w ours did. In a little dorm room 2713. This magic moment this magic moment if. Hey breathings hard. Know the feeling . Copd includes emphysema and chronic bronchitis. Sthat helps open my obstructedd coairways for a full 24 hours. Spiriva helps me breathe easier. Spiriva handihaler tiotropium bromide inhalation powder does not replace fastacting inhalers for sudden symptoms. Tell your doctor if you have kidney problems, glaucoma, trouble urinating, or an enlarged prostate. These may worsen with spiriva. Discuss all medicines you take, even eye drops. Stop taking spiriva and seek immediate medical help if your breathing suddenly worsens, your throat or tongue swells, you get hives, vision changes or eye pain, or problems passing urine. Other side effects include dry mouth and constipation. Nothing can rerse copd. Spiriva helps me breathe better. Does breathing with copd weigh you down . Dont wait to ask your doctorbout spiriva. Ashley good afternoon, i am ashley webster. Lori credit card hacks dont end that target, the latest developmentssas we learn there are six attacks on retailers. Ashley an unexpected delivery forcing economic bellwether to cut its earnings forecasts. Lori david lucks joins us on whether Corporate America has reached its most pessimistic outlook in years and executives low balling the street. Ashley the president issuing a plan to address the agencys phone Data Collection program. What are the chances or what do these changes mean to yoo and your privacy . Lori three connell top lenders concerning new home loans dropped last year as Mortgage Rates rose. Pete flynn on what the Mortgage Business slump means for his online Housing Market play. Ashley registering your presence by using your phone. It is called the beginning and it is taking the retail world by storm. Everything you need to know about the Location Tracking device as apple gets into the game. Lots of snooping stories today but first lets get to the market, stocks mixed on wall street. Lets head to the Stock Exchange where Nicole Petallides is standing by. Nicole if everyone is now been around a Stock Exchange they would see the Dow Jones Industrials up 58 points, the nasdaq and the s p are pulling back today. We are seeing a gain for the week on the Dow Jones Industrials, good move out there, we are up 1 3 , Economic News has been mixed, however you interpret it. Housing starts dropped 10 , but surpassed nalyst estimate and above the levels of the summer