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tv   Closing Bell  CNBC  December 20, 2012 3:00pm-4:00pm EST

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where they will be hidden. less take a very quick look at the markets. mildly higher. dow up 41 point. to be honest, haven't moved a lot over the past hour. hamstrung obviously by the lack of a fiscal cliff deal and progress on that front, despite all the good things happening out there on the economic front, gdp, home sales, manufacturing, all g put aside for the moment in the absence of a deal. >> and the best performing stock in the dow this quarter, bank of america. up nearly 30% this quarter alone. remember, folks, 'tis the season for charitable work, and incredible sucking up of long lost relatives. >> hi, grandma. "closing bell" is next. hi, everybody. good afternoon. welcome to the "closing bell." i'm maria bartiromo at the new york stock exchange. the house of representatives voting right now. they have a number of measures
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to vote on before speaker boehner's plan "b," but we'll continue to monitor capitol hill for any developments. meanwhi meanwhile, i'm here with scott wapner. the market modestly higher despite uncertainty over a fiscal cliff deal. new information coming up in moments. >> good to see you again. scott wapner in today for bill griffiths. less than one hour to go in this trading day. the dow is positive now, just off the highs of the day. good for 39 points. nasdaq's higher, s&p is higher as well at this point. all eyes certainly on the nation's capital though today, maria, and here at the stock exchange. >> absolutely. first, here is what we know. global exchange officials right now are discussing how to respond to an $8.25 billion deal announced today between the new york storage and intercontinental exchange.
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there's been informal discussions with the stock exchange about a deal as recently as last week but the nyse, afraid to have another deal blocked by regulator decided to go forward on a deal with i. as part of this marger officials also agreed to a clearing partnership with i.c.e. which means i.c.e. will be clearing its equity trades in europe. this deal will not face regulatory scrutiny with the way that this is formed. the former deal attempts with deutsche boerse fell and here there was no overlap between i.c.e. and nyc. however, this clearing agreement makes it very tough and expensive to break up this deal between nyc and i.c.e., so the question market sources are asking now is what is the next move for cme group, nasdaq, hong kong exchange, among others? let's talk about when,deal and what it all means right now. scott, this is part of the deal that's really being underreported and not spoken about too much. that's the clearing exchange partnership. that's going to make it very
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tough to penetrate and to get any competitors to break up this deal. >> officials all over the globe who are assessing this deal and trying to figure out what they are going to do next to try to remain competitive. joining us now are david faber, bob pisani and steven guilfoyle and rick santelli at the cme. first, david, who broke the story this morning, i guess this deal had to happen based on where the competitive landscape sits, and it's likely not going to be the last deal that we've been talking about. >> we've been thinking about and hearing about and talking about deals for quite some time but much of that did not happen as a result of regulators. the nyc has been looking for quite some time to figure out the future. its ceo having engaged with and having a deal with deutsche boerse sometime back, two years ago, in heated discussions and announced it in 2011. a year later it was dead?
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why, because of the derivatives business in europe that european regulators did not want to see get together for both of those companies. couldn't get around t.nasdaq as well, along with i.c.e. at the time, had made a hostile bid, you may recall, from the new york stock exchange, but that was stopped as well because it wasn't going to happen as a result of antitrust here in the u.s., a americaning of the two equity platforms of nasdaq and nyc. nyc kept as it, and my reporting is, let's call it september or so, right at the end of the summer, early fall, an overture was made to the nyc about a potential deal. discussions continued at that point and continued for a number of month ending with this morning's announcement from the two of them that they did in fact have a deal. fair >> david, what i'm hearing is that the cme group wanted to offer an even higher bid for the
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new york stock exchange. however, with this clearing agreement that the nyse has agreed to with i.c.e., that's probably not going to happen at this point, this is the deal that nyc is going to go with because apparently cme approached the ceo in the last couple of months, but it was probably too late. the nyc went ahead with i.c.e. and had been too further along. the question now, bob pisani, what happens with the other exchanges, hong kong, nasdaq? what are we seeing next in terms of the next target in the exchange space? >> well, at the very least, it's helped improve the overall metrix and the valuations of these companies, because now, once again, we're seeing some of the companies come into play, who are potential buyers and acquirers? london stock exchange is out still looking, deutsche boerse potentially and there are compete i competing exchanges here in the united states. hard to imagine them getting enough money to make deals, but they are still also out there. there's a whole group of
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companies out there. i'll tell you what's very interesting. we don't know what the title. new company, name of the new company. they told us everything except that. we don't know if it will have the name new york stock exchange in that. i'd like to know that and charles schumer from new york said i'm pleased they are going to keep the new york stock exchange name and protect the brand, but we don't know if that's the title. there's a subsidiary called the new york stock exchange that will still exist. if they call it global exchange without the nyse name in it. >> they have to call it the nyse exchange. >> if they drop the nyse brand, that's the dumbest thing they can do. i can't even imagine that happening. >> regulatory suicide. >> what is chuck schumer going to do? >> this is the global brand, period. >> what happens down the road? what happens two years from now? do they want to spin off the cash equities business, a low-margin business that's out there? it's literally dragging the multiple down of the i.c.e. nyse.
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does it get spun off in some other form or sold to a london stock exchange or a deutsche boerse? >> why would they buy it, bob? >> nasdaq obviously wanted it. that's not going to happen because of regulatory concerns, about there are other people who might want, it still a business, even if it's a low-margin business. >> steven guilfoyle this, obviously raises so many questions, one of which is how will this affect the people watching? how will it affect how stocks are traded, if at all? >> well, you know, this is so important here on the floor, and through the last few years transparency has been an issue, transparency has been an issue. there are some who know regulation is coming that will centralize and regulate the point of sale and that's a very big positive. maybe it's not a negative. a lot of people what are we going to do now? i'm thinking the other way. we're already trading at the lows here.
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maybe this is a real positive. >> rick santelli, what are you hearing down there on the floor? obviously the cme group wanted this. they wanted to own nyc you're -- euronext. >> you have your sources, we all have our sources. i don't know if it could clear regulatory hurdles, but higher's a couple of things. kodak used to be an iconic brand. where is it today? listen, i love the new york stock exchange, but bob is right. let's say it's not a profitable model anymore. that's why they have been trying to find a date to the debutante ball for a while now. a couple of issues with the floor. when they bought the nybot, that was in early '07. the futures part of the floor was gone within a year, and just this past october they shut down all floor trading, so you guys may have an issue with that on the floor, abe, and, b, this outsourcing of clearing has a
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bunch issues. one is that the omc wasn't interested in the ecb because of the regulations. just the regulations and the aura of dodd/frank period, is there a power play with respect to how the s.e.c. fits in, topics being discussed on this floor. >> david, the biggest question that i see from here forward is what does bob grifeld do now? he was left having to make a move and now he finds himself in the very same position it seems again. >> kind of left out, and, of course, they cannot go down -- no way they will try to make an overbid here. don't even have the financial wherewithal to do it and the antitrust authorities have already slapped him down when he kept insisting sometime back during that hostile bid that he was in, along with i.c.e. for the nyc, inseifert it had could happen and i don't know what the answer to that question is, in
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some ways, scott, what they will do, choose to do. perhaps merging with a larger entity is something. the stock is up perhaps on speculation that at some point nasdaq needs to get taken out, but there seems to be a consolidation coming. the cme may end up being independent. maria, to your point. while they may have wanted it, they did want opportunities before this deal came along to potentially come to the nyc and say, hey, we want to own you before they even talked to ice. it may be regulatory-wise as rick pointed out a non-starter for the c me and nyc. that's what my sources indicate. >> a lot of my sources say actually, you know, the cme group thought they actually could do a deal because there wasn't that equities overlap, and by the time cme actually got into, you know, here's what we would offer, the nyc was too far down the road with i.c.e. and didn't want to potentially look at another failed bid. >> right.
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the board may not have wanted to take the risk, having gone through it already for over a year certainly with the deutsche boerse deal. >> i just wondered, david, is there a cap put on what the shareholders of the nyc can make here? going to be too expensive and when you get the clearing arrangements it adds to the expense in terms of busting up the deal. this is the deal for the nyc i.c.e. can't see too many other players coming in because it's too expensive, because of the breakup fee and clearing agreement. this is what shareholders are getting, and this price really caps it at this price. >> there really isn't a company considering the company's ability to per former as one and significantly grow. two-thirds of the consideration is i.c.e. shares and shareholders will own 36% of the shares as well. >> i.c.e. stock is trading down. i.c.e. stock is down. we'll be watching that stock. >> you have a lot of growth
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investors in i.c.e. stock. may not be a value play, has quite a high multiple. very similar revenue and earnings stream, certainly earnings to the nyse. that may change and more of a growth story becomes a value story. we'll see how the stock winds up. the value does come down a bit, your point is well taken. but in terms of upside, nyse shareholders will actually participate. >> that is actually up a fraction. as always, great reporting. thanks, everybody. appreciate your time today. >> 15 minutes to go before we close up the day on wall street. the dow jones industrial average is hanging on to a fairly modest gain, 23 points or so. nasdaq, s&p positive as well. >> a look at what's happening in washington, scott? >> we should. let's take a live look at capitol hill where the house of representatives is preparing to vote on speaker paperer's plan "b" budget proposal. our other big story. does it have a chance of passing the senate before the deadline? we'll talk to senator ben cardin next. >> transformed indiana's budget
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deficit into a surplus of around $500 million. governor mish danneels explains what congress need to do to overcome the nation's debt crisis. >> and coming up, is the sky the limit now that they have sold their shares the? more later on the "closing bell."
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welcome back. here's a live picture of the house. the house hours away from voting on speaker painer's proposal to extend tax cuts for those making less than $1 million a year. we're waiting on this bill to pass the house, and it's probably dead on arrival in the senate. scott? >> another vote that you are watching go through a bunch of procedural things as well. i heard 7:00 to 8:00 tonight maybe is when they would vote on this plan "b" from the speaker. meantime, the president has already threatened to veto that plan if it gets to his desk, but does it even have a chance in the senate? john harwood is at the white house with the late on the fiscal cliff talks. john, the leader in the senate harry reid says it's a non-starter there. >> reporter: exactly. that's why it appears not to have a chance to go beyond the
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house of representatives, although republican leaders are confident they will have the votes to pass it in the house. just got a statement of support on plan "b" as a viable option from the u.s. chamber. got that a moment ago standing here waiting for the live shot but harry reid had a press conference earlier today, part of the ping-pong back and forth between politicians of both parties today, and he said the senate is the not going to take this up. here's harry reid. >> we are not taking up any of the things that they are working on over there now. it's -- it's time for the republicans to get serious. it's very, very, very unfortunate the republicans have wasted an entire week on a number of pointless political stunts, and that's what they have been. >>. >> reporter: now, of course, you could get very pessimistic on the basis of statements like this because the house said they will take this up and then wait for a response, but there was in john boehner's conference a note
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that people can hang their hat on if you want to be hopeful because he was asked if the house now done. are you simply going to leave and we're going over the cliff if the senate doesn't do this? john boehner didn't say that. listen to what he said. >> our country faces serious challenges, and -- and the president and i in our respective roles have a responsibility to work together to get them resolved, and i expect that we'll continue to work together. >> now, that suggests that once the congress acts this afternoon, the leadership, senior staff may continue meeting, trying to make some progress. we will then have christmas. members will come back early next week so the hope is not entirely gone, buys, that we will get a deal in advance of january 1st though certainly that seems less likely than a week or two weeks ago. >> all right, job. thank you so much. house speaker john boehner's plan "b" budget proposal is moving closer to a vote in the
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house. our next guest says it's not enough of a game changer to get the deal done. >> and joining us from capitol hill is maryland's democratic senator ben cardin. nice to see you >> nice to be with you. >> harry reid says it's not even going to come to a vote. is that fair? >> we're not looking for a plan "b," a balanced agreement between the president and speaker boehner. we want them to come up with an agreement. time for speaker boehner to come up with an offer. plan "b" just takes us further apart. that's not what the american people want. >> senator, let me ask you what you're willing to give on here because the president has raised the level at which taxes should be raised to those making $400,000, up from $250,000. would that be acceptable, and what kind of spending cuts are you planning to say yes to? what would you agree to? what are you going to give on, senator, to get this done? >> we want a balanced approach. >> i know you want a balanced approach and everybody is saying that over and over again but why
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don't you explain to our audience what that means, sir. >> first, we've already agreed to $1 trillion of domestic spending cuts. that's already been done. >> we're talking about the here and now. not what's done. >> next is revenue. we need -- the president is now suggesting between $1.2 trillion in revenues. that's -- that's less than he said before. we have to get that $1.2 trillion in real revenue. that's the next step. >> right, and you can get that revenue -- you can get that revenue by changing the tax code and raising rates only on the very top, which is more than $1 million, right, so where are the spending cuts from here on out, the here and not, not what was done over the last year? >> maria, we have not -- the speaker has not yet agreed on the $1.2 trillion of revenue. he gives us some ambiguous way of raising it. the president has been very definitive about how we can get it through rates, and how we can get it through specific changes in the tax code. we haven't gotten a response on that. we have already said that we can
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save money in our health care system, and if we save money in more efficient health care system, we spend less money on medicare and medicaid. we're prepared for those reasonable reductions in spending. we know it's got to include spending cuts, but the next step is speaker boehner, and he has to more forward with the revenue. what's been frustrating for many of us is he has that bill in the house and he hasn't moved it. >> what are you willing to put on the table, sir, in terms of entitlements, medicare and social security? others in your party have suggested social security shouldn't be part of this discussion. it obviously has to be at some point, along with medicare. what are you willing to put on the table today? >> when you look at the social security circumstance, it has not added to the deficit we have today. let's deal with the deficit, the gap, and what we have suggested and we started it with the affordable care act, let's have a more efficient health care system. let's get people out of hospitals, let's have less readmissions and a more efficient system. that will bring down both medicaid, medicare and private
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health insurance costs which will help our economy. >> i just don't understand how you're not willing to move at all on social security, at least put it on the table. we all know, sir, and i think everybody is only asking you and your colleagues on the hill to make some sort of shared sacrifice, to try and bridge the gap and come to some kind of an agreement to rise above and settle this whole mess, and it just doesn't seem that you're willing to do it. >> i couldn't disagree with you more. we've already done $1 trillion of domestic discretionary spending cuts. that's the first cuts that were made. middle-income families have been the hardest his during this recession. what we're seeing is basic fairness. let's protect the middle class families. social security needs to be talked about, but it's not part of the current gap we have between revenues and spending. let's deal with the current problem. >> but you know what it is, every day you and your side, you come out and say that the other side is not a balanced approach, and then they come out, the republicans come out and they are saying that the dems' plan is not a balanced approach. are you guys just incompetent or what?
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i mean, if you can't do this, if you can't do what the american people pay you to do, why don't you just step aside and put somebody in there that can actually get a deal done? >> if you -- if speaker boehner would allow the house of representatives the vote on the bill that we sent over, there will be 218 votes on the floor of the house of representatives to pass it. he's the one holding back the next part of this puzzle piece. we are prepared dsh we were prepared for a $4 trillion deal. we're prepared to move forward. >> how come you're not moving forward? what's the problem, because the american people are so tired of this, and they are really tired of the lawmakers thinking that the american people are stupid. you can't keep coming on the show every day saying the same thing. it's not a balanced approach. >> believe me, we're as frustrated as you are, but we're not going to be intimidated and give up our protection of middle income families during this period of time. >> let me ask you. >> we said very clearly that we're prepared for a full package, been prepared six months ago, a year ago. speaker boehner has to show some
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leadership. >> i don't know what he's talking about. >> let me ask you one final question, sir, because we have to figure the threshold that we're talking about is going to eventually move. the president says it should be 400,000. the republicans stay should be 1 million. what are you prepared to do above 400,000 that can get us closer to rising above and finding agreement, common ground? >> we need 1.2 trillion of real revenue that we can count on to fill the gap. that is the minimum amount. >> well, you can get 1.2 trillion by changing the tax code. that means eliminating loopholes. are you prepared to vote to limit the loophole of charitable deductions? are you prepared to put that on the table? >> no. >> are you prepared to put on the table the mortgage deduction? will you put on the table the mortgage deduction, yes or no? >> i'm not going to make a decision in the next couple of days. >> are you willing to take away the carried interest loophole? yes or no. >> are you interested in me responding. >> because you're talking about 4 trillion in revenue but you're not prepared to put news oin on
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the table. people are not stupid >> i know they are not, and they are expect the congress to act in the right way. i'm not going to vote today on changing a tax code provision without knowing the impact of it. we're now a few days away from christmas. the easiest way to get the revenues is to get the rates from the higher income tax -- >> that's all you want to do. it's your way or the highway. raise the rates on the rich. no other way. your way or the highway. that's where we are. >> senator -- >> next time let me answer the questions. it would very nice. >> you've answered quite clearly. >> thank you. >> senator cardin, we thank you for joining us, and we'll catch up with you again. i am certain sometime soon. >> i don't know. you know, scott, it's frustrating because here we are with 11 days left in the year, had 13 months to do this and now -- come on. >> well, i mean, look -- >> traders on the floor have been watching this show. that's all i'm going to say. >> what's happened in this
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entire argument day after day after day is the markets are the ones held hostage. >> we're all being held hostage by the people in congress. >> it's the people's money, people at home trying to figure out what the heck to do in the stock market as we approach end of the year and what a pretty good year it's been for the stocks. >> thank you, thank you, federal reserve and ben bernanky. >> but they are trying to figure out what to do now. as they watch interviews like we just had and throw their arms up in the air. >> absolutely. let's take a short break. an exciting beginning of the show, scott. 35 minutes before the closing bell sounds. a market up 17 points on the dow industrials. >> today is the busiest shipping day in the history of the ups, which stock is a better bet to deliver profit for investors, ups or fedex? >> and research in motion shares trading red hot, nearly doubling over the last three months and the can the blackberry's latest earnings keep this going? interesting analysis of the results coming up. stay with us. to the best vacation spot on earth.
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how is this for a busy day at the office? ups expected to deliver 28 million packages today, making it the busiest day in the company's history. janet shamlian is at a distribution facility in louisville, kentucky. >> reporter: if you time it out, it's three packages a crazy which is crazy. after what's been a mild season, today the busiest deal for them, a major winter storm closing fact, they just diverted 20
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plains going to des moines, iowa, here to louisville, the company headquarters, trying to work around some of the weather issues. now the packages you see rolling off behind me are going on to conveyers. they will spend 15 minutes in this facility. pretty much directed by barcode. just come off planes sitting 100 yards from where i'm standing out on the ramp, and they will go back out on the planes within a very short time period. and that's the way they roll here. it's a 24/7 operation. today is the busiest day they have had all year, and today is the highest volume as well because the explosion of online shopping has made it so that you can order up until the last minute and get there in time, so the weather is a slight hiccup. they say they have plenty of time to get it there, and they are just going here like they have never done before. scott, back to you. >> all right, janet, thanks so much. >> scotty, 300 packages a second is what janet just told you. >> a big day at work.
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>> really is. ahead of that christmas holiday and ahead of the storm, which shipping company would you rather buy right now, ups or a smaller competitor fedex? let's talk numbers on the shipping companies. our guest is with bell point alternatives and on the fundamental side of the story stephen weiss is with short hills capital. good to see you. jeff, make the case. you're looking at the charts. how do you like ups versus fedex? >> maria, i think you have to look at the longer-term chart, and if you look at the ten-year period, the true leader is federal express. it's up 76% versus the 24% that ups is. that's where you find the leaders. now let's take a closer look and look at the micro view of this chart, and we go to the year to date chart, and if you see a year to date, trading within a range, between 84 and 94, and what's going tonight difference. what's going tonight difference to push this to go higher, the catalyst, right. we wanted to see it go above $94 a share and the catalyst is going tonight international
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markets. we've seen some clarity over there, and you've seen a really -- fedex's international numbers have to increase, and that's the catalyst right there. >> jeff, they are both international. it depends on where you want to play. i like ups better because it's got a 3% yield versus a less than 1%. i think about half a percent yelled for fedex and still in a low return environment. if you look at a five-year chart actually, there's no difference between how the two trade. they are two horses in the same race. the only two horses in the race. i'll tell you something else. ups is making an acquisition to expand their international revenues, and right now if you want to bet on a recovery in europe, which is a good place to bet, ups is bigger in europe than fedex is. they get half their international revenues which are 74% total revenues. that's a good place to put your money. >> let's go back to the technicals a little bit. if you see the range that we've been playing 84 to 94. now it's starting to consolidate
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a lot higher at the top of the range, and a breakup above that 94. >> that's well and good, but technicals will follow fundamentals ultimately, and the fundamentals -- >> the point that you're missing is that the international volumes are increasing more in fedex than they are in ups right now. >> all right, guys. this is -- this is a great analysis on both sides. i can't decide. you guys make such good cases on both. we'll be watching, gentlemen. thank you very much. scott, over to you. >> take a look at the dow right now. the dow is up about 26 points with about 30 minutes to go before the bell. you've most likely purchased some of conagra's well-known brands at the grocery store so why is the food-maker placing a bet on generic brands in the ceo is here exclusively. and would you have made a lot of money if you listened to our next guest's predictions a year ago right here on this very show, so go get your pen, grab your paper, because rbc's mark harris reveals his top five picks for 2013 straight ahead. tdd#: 1-800-345-2550 this morning, i'm going to trade in hong kong.
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welcome back. one year ago rbc's mark harris came on "closing bell" to give us his top picks for 2012. wait until you see his picks.
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his top pick, discover financial, up about 60% so far this year. back with us exclusively to give us his top picks for 2013. >> and with a track record like that the pressure is definitely on. >> joining us now is mark harris from rbc. >> i'm just -- i'm just the guy standing on top looking down and making a few picks along the way. >> that was one of your picks, but a lot of your picks turned out to be fantastic. >> did pretty well with our u.s. topics and this year we tried to expand it out and make it a global 30 top picks. >> a single theme. before we go through your picks, what's the theme for 2013? >> 1,500 stocks to recover, i went out and the simple question from the analyst is give us your top ideas. we came up with a list of 30 from that. within that, we sort of -- we looked out and when they gave us the picks it ended up being thematic, three things, housing, energy and slow and equal economic recovery and three that largely fell out from the names
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on the list. >> people are going to look at that list right there, and they are grabbing their pens literally as we speak. >> these are 30 great names. i tried to pick five that i thought sort of spread the list and gave a little bit of the sense of the international diversity of our coverage, so the first one i give you is brookfield asset management. here's a big global alternative asset manager. you've got exposure to two of the major themes, housing. they have got holdings within their portfolios where they have exposure to big board-makers, and then on top of that within residential big exposure to their core business. add on top of that, within energy, energy companies for the portfolio so lots of way to play and lots of ways to play along those themes. >> what do you want to avoid sneer what are the areas that could get under pressure in 2013? >> short term i think we all understand the fiscal crisis and the fiscal cliff, and we're not going to spend a lot of time talking about the short term. in the longer term this is a slow growth economic environment, make no mistake. by slow we're talking 1.5% to 2%
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growth in the u.s. and even emerging markets, having 5% growth, this is robust, relative to the 8%, 9% we used to see not long ago so my sense is you want to avoid extreme industrial exposures, you know, sort of pure cyclicals plays that are going to lead you down a bad road. in general, you know in, a slow, steady economic environment. equities seem to do well. diversified company like brookfield can do well >> you think it continues to be a good year for the big financial? >> that's a great question. i do think selectively, selectively you can find some picks within that. one of the picks on our list is actually pnc. this is, again, domestically a diversified bank. again, not in some of the businesses that will be under pressure from margin like the larger investment banks, but we'll continue to see a lot of other things going on and a lot of margin pressures. pnc, housing recovery, a pretty well diversified portfolio, well
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invested. i wouldn't go towards the big traditional investment banks less. >> especially since we've already seen a pretty big move in a lot of them. >> absolutely. >> top three names we should buy for 2013 are what? >> here's a diversified play within energy, really focused in. >> real quick, what else? >> i'd like at usg, housing recovery play, and lastly i'd look at clean harbors, a play on cleanup and recovery, industrial play, but one that has a pretty steady cash flow. >> you like schneider as well. >> another one on the international side, electrical equipment and industrial distribution. >> mark, congrats on a great performance. >> thanks very much, guys. >> thank you. we're in the final stretch. 20 minutes before the market closes on a thursday. market creeping up higher. up 35 on the industrial average. >> up next, three top traders weigh in on how today's huge exchange merger will help impact your investments. >> and what does aig have up its
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sleeve now that the government has sold its stake in the company? more on that later on the "closing bell." stay with us. [ male announcer ] you are a business pro. omnipotent of opportunity. you know how to mix business... with business. and from national. because only national lets you choose any car in the aisle. and go. you can even take a full-size or above. and still pay the mid-size price. i could get used to this. [ male announcer ] yes, you could business pro.
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and don't get heartburn in the first place! [ male announcer ] one pill each morning. 24 hours. zero heartburn. and don't get heartburn in the first place! boproductivity up, costs down, thtime to market reduced... those are good things. upstairs, they will see fantasy. not fantasy... logistics. ups came in, analyzed our supply chain, inventory systems... ups? ups. not fantasy? who would have thought? i did. we did, bob. we did. got it. welcome back. big announcement from the nyc
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euronext and i.c.e., confirming a merger deal. how does that impact your investment and your money? >> welcome to our guests. chezzy, i'll begin the conversation with you. you're down here on the floor of the stock exchange. what do you make of the news? >> it's a lot better than the one we could have had when nasdaq was looking at it a year ago. it's a pretty good fit, as most people mentioned. the future looks bright. a good niche. we're down here trading stocks and equities and trading options. the i.c.e. trades and futures and commodities. again, it's a pretty good fit. >> does it matter to you whether they keep the name new york stock exchange, a conversation we had at the very top of this program? >> no, i don't think so. >> really? >> that is -- that is the brand. >> i'm surprised that you would say that, to be honest, matt. >> you know what, in this world, they are changing everything and they are changing quickly. i think the nyse is the brand, but you know what, i'm not part of this deal so i don't really have a say in it. >> let me get your take in terms
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of what this means for people's money, in terms of electronic trading. andrew keene, you're an independent trader at the cboe in chicago. do you see changes happening as a result of these two players getting together and if in fact we were to see more consolidation? >> yeah. obviously we're going to see a lot more consolidation. i think the one that is going to be a big target for a takeover is the cboe. they have two great derivative products, the cboe that's a fixed and the s&p 500 options. the cme tried to buy the cboe in 2009 and couldn't do it for regulation problems. i think going forward to the cb o'is going to be a target that everybody is going to look at that can really help. the deal between the i.c.e. and the new york stock exchange is a win, win, win. they all win. all the exchanges win except for the cme. the cm sze losing volume from their interest rate products. the cboe has done great volume for the vix product, and i think this is a takeover candidate going forward. >> what happened to the cme then?
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is there an acquisition? >> they have to make a move. >> is there an acquisition that would make sense and that would pass regulatory scrutiny? >> i think the regulatory problem is the hard one. they have been trying to bite cb o'since 2009 and 2012. they said they weren't going to get the deal done. need to figure out a way. the cboe has great technology and the cme knows they have the technology. products people want to trade. the vix volume goes up every single year at the cb o'. the cme's volume is going down with the merger between the i.c.e. and the new york stock exchange. it's good for almost every party, except for the c me, so i think the cme really has to make a move here. >> mike, let me steer your attention to the market at large. what are you doing today? what do you make of what's happening given we only have a handful of days left before the end of the year, and we're watching washington as we always do? >> yeah. i think -- i think the market had melt a lot better. you know, the market held in pretty well, and the last couple of days i think the acid test,
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the market has been more subdued around all this political maneuvering. i don't know what you can do. i think you have to hold your breath and wait and hope they are not serious about letting us go over the cliff. you know, bernanke has worked so hard, and you're finally seeing some recovery in the housing market. the best numbers on an annualized basis since november of '09, right, and basically, you know, this gets kind of tossed, and, you know, you have kind of this infliction point with so many things, gdp, unemployment, ism, and, maria, you'll know, i've been tracking earnings long time. locked at q3 earnings and saw 38% of companies beat ref, new that's an all-time low. more -- as long as i've been watching earnings, i've never seen what we've seen the last six weeks. we've gone from analyst expectations from over 9% to down to 3.5% for the first quarter. >> wait a second, what you're telling me then is regardless of whether or not we go over the fiscal cliff, the economy is slowing just by this inaction
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and this back and forth nonsense in washington. they have already had an impact. >> i think that's right. look, companies aren't waiting. they are working with the best information they can, and literally they have to make decisions. they can't sit there, and that's really where the dict is, people have to take action on the best information and, unfortunately, they are not getting really good information so it's kind of a random walk now. i think most people in the market, most customers two weeks ago said a deal will get done. this is serious. i think bernanke's probably got his hands over his face right now because all the work that they have done on the monetary side could, you know, literally be undermined by the fact that these guys can't find some common ground here. look, i'm still hopeful. i still think it can come back. >> all right, guys. >> all right. thanks, guys. appreciate your time. 12 minutes before the closing bell sounds on wall street. the market is up 36% on the dow, and that's one of the issues here, so much room for disappointment in this market.
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the market still expects a deal. >> definitely pricing in a deal, right? that's why we've had a pretty good week. a couple of double, triple-digit gains, holding in pretty good. up 38. counting down the worst trade of the year, and up next i'll reveal what's been one of the most disappointing stocks on that list? >> hewlett-packard? >> oh, it's on the list. i'm not going to tell you if it's next. >> and gary rodkin with us here to talk about his company's bottom line. stay with us. let's give thanks -
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for an idea. a grand idea called america. the idea that if you work hard, if you have a dream, if you work with your neighbors... you can do most anything. this led to other ideas like liberty and rock 'n' roll. to free markets, free enterprise, and free refills. it put a man on the moon and a phone in your pocket. our country's gone through a lot over the centuries and a half. but this idea isn't fragile. when times get tough, it rallies us as one. every day, more people believe in the american idea and when they do, the dream comes true. we're grateful to be a part of it.
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countdown to the best and worst trades of the year continues now with a look at a stock that captivated our attention in 2012. there's a look at the wall, the big reveal, it certainly did not live up to its hype, and that is facebook. maria, i mean, the morning of may 18th there was so much optimism in the market about this ipo. >> right. >> remember bob grifeld was out there at nasdaq. >> muscle shirt. >> next to mark surkberg, stock at 38 and went up to 45, and after a delayed opening and it hasn't come close to seeing that since. >> that's just about where dan niles short it had. >> yeah, right. >> i will make the argument. i think it's one of the most
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important stocks in 2013 for this reason. number one, one of the most closely followed companies. i also think that facebook's demise of its ipo absolutely had a negative impact on the retail investor. >> yes. >> and i think as that stock has made a comeback, as you look here, entered the latter part of the year, the stock has rallied a bit, that if it continues to do well, it can only help overall sentiment on wall street. a lot of people use facebook, a lot of people follow the stock. if it does well i think it sort of pulls a lot of boats along with it. >> i think it's a great analysis. one of the issues is the retail investor doesn't trust anybody. andrew cuomo has said something, too, which i've said a number of times on this program which rings so true. people go back in the water when they know the shark is dead. >> that's right. >> that's the issue here. the retail investors keeps getting right hook, left hook all the time, whether it's the flash crash objection you know, one of these companies that's so widely held by them plummeting. so they just don't think the shark is dead yet.
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>> such a tremendous amount of optimism about this name. people had such high hopes for the company that it was going to figure out how to monetize mobile and all of these other -- answer all of the other questions that are out there in the stock, a little bit of momentum now seems to be behind the company, we'll see what's in store for 2013. >> you think it would be a better year than 2012 on fook? >> oh, gosh, certainly -- >> got to be? >> it has to be, given what's happened with the stock. since that day of the ipo. >> a great list. we will continue to look at scott's list of best and worst. one of facebook's biggest challenges, of course, finding ways to monetize the business. now it may have found a new revenue stream, but will this outrage users? over to julia boorstin. >> reporter: facebook continues to look for new business models but this one could be very controversial with users. facebook is testing charging some of its use first they want to e-mail people they are not connected to. this is part of an overhaul of facebook's messaging system,
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adding new filters, and facebook calls this a small experience to test the signals of economic signals. what does it mean? it will charge fees starting at $1, and it's limiting the test to individuals rather than companies or brands, and in order for this not to feel like spam it's only allowing users to receive one paid message each week. now, investors may be happy that facebook's testing yet another way to make money, but messages that look like paid spam could really alienate users. scott, over to you. >> all right, julia. thanks so much. julia boorstin for us out in l.a. up next, it's the closing countdown. >> get all fired up for that, and then we're just members away from research in motion and nike earnings. how hot has rimm been lately? >> huge, huge comeback. >> absolutely. we'll get the numbers, see if it's worth the hype. coming out after the bell. you're "closing bell" on cnbc, first in business worldwide. i always wait until the last minute.
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and his new boss told him two things -- cook what you love, and save your money. joe doesn't know it yet, but he'll work his way up from busser to waiter to chef before opening a restaurant specializing in fish and game from the great northwest. he'll start investing early, he'll find some good people to help guide him, and he'll set money aside from his first day of work to his last, which isn't rocket science. it's just common sense. from td ameritrade. . all right. welcome down to the floor of the new york stock exchange. it is time now for the closing countdown. i'll show you where we stand right now. adding a little steam to the dow
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as we head towards the close day. dow up 48 points and the nasdaq is hanging n.s&p hanging in as well. all eyes on the nation's capital for that expected vote sometime this evening on speaker boehner's plan "b." a couple of big stories today. certainly the merger between or the takeout really of the new york stock exchange by the intercontinental exchange. i want you to take a look also at shares of herbalife. boy, has that stock been in the news for the last 24 hours. a down day yet again. the big news, bill ackman taking a short position in this stock, making his case today, not only at the conference in the heart of new york city, but then on cnbc. the company coming out trying to defend itself, but you'll see shares of hlf, that being herbalife, still down 10% at this hour. let's bring in allen valdez from dme securities. let me just ask you first about this deal. i.c.e. and the nyse, you're a trader. you make your living down on the floor of this new york stock


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