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tv   Power Lunch  CNBC  November 27, 2013 1:00pm-2:01pm EST

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>> steve weiss. >> amazon through 400 next stop. >> josh brown, i like the xlf if you're not long this group easy way to get in. >> jon. >> boyd gaming, upside january call buying. >> that does it for us today. hope you have a wonderful thanksgiving. we'll see you on the other side, follow me @scott wapner cnbc and "power lunch" starts now. >> "power lunch" and the second half of the trading day starts. >> thank you very much. 'tis the season, the eve, of course, of thanksgiving. you can almost taste the it turkey. christmas just 28 days away. the ornaments coming out of garages, tree shopping about to begin, i've seen the stands already going up. in my neighborhood. the mistletoe is coming out. but -- >> ah! >> that was a woman screaming, wasn't there? that is because there's fear out there, fear for the markets in 2014, fear the rally is going to falter, fear from wall street all the way out, even into
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silicon valley. we have it covered today. sue is at the new york stock exchange. hi, sue. >> hi, ty. and while there is fear out there, we also have a lot of optimism as well. take a look at the russell 2,000 hitting a new record high today. right now it's up about a tenth of a percent and the transports also hitting a new all-time high today and for those of you who follow the dow theory, that is an important indicator, up a third of a percent today. the nasdaq well above 4,000, it's about to have its third monthly jump of 12% in the last three months. craig columbus is president of first allied asset management in phoenix. he thinks there's more upside to this market but he's also cautious. he sees some warning signs out there, reducing exposures where evaluations is most stretched. what's making you cautious and nervous about this market? >> i think we can expect more upside but also prepare for more volatility. we haven't had a 5% correction since late 2012, so i think 2014 looks like 2011 where we had an
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interyear correction of about 19% but we finished the year positive because the inflation and recession risk is very low, sue. but so i think the cat tas list would be the taper. many think we are better prepared because the market is conditioned for taper after last summer. i don't see a painless extraction is possible. the fed has this terminal rate problem. >> say there. we'll get more from you on the other side of the trade in about four minutes from now. up to you. >> been waiting all day for this segment, patiently waiting, arrived hours before, meeting you, john fortt. there are more and more voices out in silicon valley where john used to hang out, piping up, piping up saying beware of the lessons learned in 1999. he covers fortt, muoney behind t all. is that what you're hearing? are people saying man this is feeling like 1999 again? >> not that exactly but people are looking at the calendar and wallets because things have been
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going really well on a number of fronts. but at the same time you have snapshot as "the new york times" mentioned turning down multibillion dollar offers. that doesn't seem crazy in light of instagram, if they hadn't sold to facebook they would probably still be turning down multibillion dollar offers to. >> to john harwood for breaking news regarding obama care. john? >> tyler, the obama administration about to announce a delay in the on-line sign-up for small businesses on obama care. there will be direct enrollment for those small businesses. they can get health care under obama care with the tax credits that the law provides, but they're trying to limit the amount of tasks that they have to deal with in terms of getting the on-line experience acceptable for consumers. they've got that november 30th deadline to say that the site is working smoothly for the vast majority of customers and
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they've put this off to the side. the separate exchange for small businesses. that function is being put off for one year. there will be paper enrollment, phone enrollment through insurance companies directly, insurance agents and brokers, but it's another sign of the challenge the administration is facing in getting healthcare.gov that website which has been so troubled since its october 1 debut to get up and running for everybody in the country. >> john harwood, thank you very much. let's transition back to some of the topics that we've been talking about earlier today, that is the rising levels of fair and concern. dominic chu making calls talking to traders to find out whether they fear the rally will peter out and reverse in 2014. >> here is the interesting part. three different takes from three types of market professionals. first off is the strategist take. john stolts is chief market strategist at oppenheimer look
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at the bigger picture, his worry the dysfunction in d.c. no surprise there hearing from john harwood. john says we got through some of the worries of the debt ceiling and budget impasse the last time around but a second go-round with budget concerns and debt issue may not play out as well. next it's the fund managers take. the folks that make the investing decisions about where to put the money. kneale hensy says his biggest worry the unemployment situation is not being resolved fast enough and blames uncertainty on taxes, regulation, and yes, even health care. once that gets resolved hiring will start to pick up. that's what kneale thinks. our traders' take from john at meridian equity partners on the floor of the nyse. he says a possible market taper tantrum is his worry. john says the fed will have to pull back on stimulus at some point but his fear any panic may have ripple effects possibly without any cause and janet yellen of course the nominee,
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presumptive new fed chair, hasn't been confirmed, but maybe that's a concern with the fed and the common theme here, tyler, all washington-based. >> thank you very much, dominic chu. >> nobody is suggesting that we're about to go to war with china but a fight over some air space in the sea of japan, michele caruso-cabrera has caused the president to send b-52s into air space that china claims as its own. >> yeah. >> what's the latest? >> this is part of a larger story about china trying to assert its military presence and its military power. it's an issue that vice president joe biden will raise when he visits china next week. so this all started this past week. china publishes a new map with an area they described as, quote, an air defense identification zone. bottom line, you fly a plane through that area you better identify yourself to the chinese or they could take action. almost immediately afterward the united states flew two unarmed b-52s like the one you see in this video through this identification zone and no, they did not identify themselves.
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even though the pentagon says it was a long planned training mission it's being interpreted as a signal the u.s. sees the area as international air space. the chinese did not take any action today. they explained that they'll take action depending on the level of threat. this is a very contentious area of the world right now. china and japan have a dispute about it. even the name is controversial. you call it the sea of japan, that upsets the koreans and chinese, the chinese call it the east china sea. it's contentious because it's valuable due to fishing rights and possible energy resources there as well. >> another story you've been following is about a collapse, a building accident, in so paolo brazil building stadiums for the world cup. >> the stadium where they're supposed to hold the opening ceremony in june. local media reports perhaps a crane has collapsed. this is the first video in the last few minutes. at least three people are dead. >> wow.
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>> we were there during the world economic federation -- world economic forum and we did a lot of stories about whether or not the stadiums were going to be ready because a lot of them they hadn't started building them yet and questions about whether or not they would be rushed, would they be safety issues. that's going to be a question in this situation. >> that's something. >> this is 2014, the world cup goes there? >> exactly. >> and the others are 2016 in rio. >> two different organizations, two set of infrastructure. we were all far more worried about the stadium infrastructure for the world cup than the olympics because the ioc believe it or not is more organized than fifa. >> all right. michele, thank you very much. have a great holiday. >> you too. >> sue, down to you. >> thanks, guys. we have two guests, two opposing views of the market. craig columbus you heard from at the top of the hour cautious on this market, with bull jerry castlini at castle arc management in chicago. you heard what greg said at the top of the show, the taper might trigger volatility and be ready for that but you think longer term this market can go
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considerably higher? >> yeah. i mean, in any market environment there's pockets of risk and there's areas you have to be concerned about. one of the areas we're worried about are these defensive stocks, the 22 multiple 2% growers like a bristol myers or a merck and they should have risk but what you should focus on is the rest of the market that really hasn't gotten going yet. all sorts of growth stocks and all sorts of areas that are still trading at historically low valuations and if you combine the wind at the back if you want to call it of accelerating world economic growth, a continued lickety move from the fed and just the fact that earnings are going to continue to grow, that should put a nice floor under stocks that otherwise you would feel risky being here with an up 20 something market this year. >> all right. but craig, if you are right, what do you do to protect your
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portfolio right now? the gains that you've made in this market? >> okay. so i think there's the terminal rate problem. as soon as the fed introduces taper markets look ahead and start to price in the end game. what we would do is reduce some of the areas where valuation is most extended like small cap trading at 28 times or some of the consumer staples just mentioned, and then i think we would add to things like tech noll and energy where valuation is more attractive, technology, a lot of cash on the balance sheet, handle a high rate environment and rebalance some of the international versus the u.s. u.s. looking chep cheap --s u.s. looking expensive relative to some of the international which looks cheap. those are the three things we would do. >> would you do international, jerry? would you look outside of the united states? i know you like the growth play that's still intact in your opinion here in thes u.s., but what about going overseas? >> overseas is a great point but you have to be very careful. india and brazil seem a little riskier today than perhaps
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europe an a lot of folks have been away from europe. they don't realize the repair that's taken place in the economies and how much better it things are. but you can also play that through great multinational u.s. companies and to that i would point a lot of our industrial companies have 50 percent of their earnings coming from these growth economies outside of the united states and they also haves this great u.s. economy and i would focus on those kind of names. i would add energy to that. here we've sat at $100 oil for two or three years. >> right. >> we're just starting to get the valuation in those names. there's a lot of places to go in this market, and worrying about the taper is never going to make you any money. >> thank you very much. we'll leave it there. very interesting discussion. have a wonderful thanksgiving to both of you. >> thank you. >> ty, up to you. >> another big story this day before thanksgiving is the weather. the weather channel's carl parker having a busy day. >> hi there, not the worst of storms we're looking at but the
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timing is not good. the radar and show you where the problems are right now. getting light snow in the virginias up the 81 corridor and into d.c. there has been a report of some sleet. that's also been the case in baltimore. there will be a little bit of wintery weather on the backside of this very big area of rain. merfully it's mostly been rain for the largest metros. obviously with the low clouds ceilings that has slowed things down at the airports. we are seeing now some snow coming off the lakes. western parts of new york. snow in pittsburgh and cleveland and southwestern lower michigan quite a bit of snow around benton harbor has slowed things down around 94. those are the trouble spots. this is the model depiction of this big storm lifting out by this evening. it's mostly gone. so we just have lingering lake-effect snows. and the snowfall going forward is not going to be terribly heavy. we've got a pretty large area of about one to three inches with pockets of five to eight inches.
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mostly across interior parts of the northeast and northern parts of new england. sue, it things certainly not the best but they could have been a lot worse. >> absolutely. we'll focus on what positives there are in that. thank you so much. take a look at the white house. there is one lucky turkey. and a beautiful turkey at that. he's strutting his stuff right in front of the white house. the president is about to pardon that turkey shortly. he's having a good day. all right. we'll take that live when it happens. meantime the countdown to christmas is on. is the world of retail going to see a huge rotation this year? from clothes to technology. where are the pesky unpredictable teens shopping? what do they want? how much can they spend and which stocks might benefit? that's all next. >> coming up -- power pitch. start-ups give us their 60-second pitch. >> my name is tressa, the ceo of manning kilts. >> i'm nicolas the founder.
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i'm mandy drury. we have a company raising eyebrows in the window washing business. the uniform is a kilt with the
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motto no peeking. let's take a look at their power pitch. >> my name is tressa wood and i'm the ceo of men in kilts. >> i'm nicolas, the founder. we're a franchise window and exterior cleaning company with locations across north america. we service residential and commercial cu mers in the cleaning and building maintenance industry. >> who do you think of when you need to get your windows cleaned or driveway pressure washed. the industry's fragmented and generally unprofessional. our goal to become the industry leader and a household name delivering exceptional customers service guaranteeing our work and best of all making people smile. with the right franchise owners lined with our vision and brand we'll be in every major metro by 2017. we know the model works. two of our franchises are doing over a million in sales and we can replicate that success in every major metro. we're on track for close to 6 million this year and have the
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systems in place for fast growth. >> our long-term vision to offer multiple franchises such as lawn care, carpet cleaning and painting. remember no peeking. >> no peeking. they're on the right side of your screen. they can hear us but can't react. we have don peoples, chairman and ceo of peebls corp which includes the multibillion dollar development of luxury hotels with lots and lots of windows. and cnbc entertainment and media reporter julia boorstin who happens to be a homeowner who i believe hates window washing. okay. guys, let's huddle up on men in kilts. julia, what do you think? >> every homeowner at some point will need a window washer but it seems gimmicky. i think people care how their windows are cleaned and want them done well but don't care what the washers are wearing. >> what about you, don? >> i agree. i think this is a very applicable to the residential industry and the commercial industry there are a lot of companies that are doing that right now.
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on the flip side on the residential side nowhere knows where to go. >> in terms of prom they want to be the industry leader which i think is quite an ambitious plan. i'm keen to hear more about that. tressa and nick, you're in the hot seat. time to get grilled. >> tress sa, what percentage of your business is from commercial versus residential? >> our commercial business is about 50% of our total revenues. i don't think the kilt necessarily appeals to the commercial market in the same way it does residentially but the service is how we compete. >> don be? >> my concern is, how do you attract employees that actually want to wear the uniform? >> nobody applies for the job unless they have the personality and the confidential to wear the kilt. it's a nonissue. by the time they've sent their resume in they're on board. it becomes a fun job. more than going to work and cleaning windows. it's got some culture to it. that's not an issue. >> how many franchises have you sold and planning to sell? what kind of pace of sales are you making in that department? >> so right now we have nine
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franchises. we should be at about 15 by the end of this year and, you know, we're hoping to sell about 20 to 30 next year and then, you know, from there, the sky is the limit. >> but nick, how do you address the fact that the kilt feels like a gimmick and there's no sort of correlation in people's minds between men wearing kilts and window washing? >> part of business is able to stick out from the crowd and be remembered. we do that and follow it up with professional service. >> nick, you say your men in kilt, would you rejaekts a lady that applies to do the same job. >> not at all. with we have women work. we've had some of our best employees be women. >> they wear kilts up there high washing the windows standing on the ladder. >> they do. like tressa said, if you're applying for that job that's not a problem. if you're it terrified of heights, terrified of kilts and don't want to be noticed you're to the applying to our company. >> that wasn't exactly the problem i was thinking of. nonetheless -- >> well -- >> thanks for your answer.
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okay. guys. you heard what tress sa and nec had to say are you in or out on men in kilts? don, you first. >> it's got a good gimmick but i don't think there's enough substance behind expanding the brand on a national or international basis and so i would be out. >> what about you, julia? >> i'm pleasantly surprised by how effective the gimmick is to attract customers and employees but so much competition, especially on a commercial level i think it will be hard for this gimmick to scale. i'm out. >> i'm going to be an in. i like the idea, the fact, tressa, you got great experience, it's gimmicky and you have to stand out somehow and everybody needs a uniform and you will allow ladies in kilts. tressa, two outs, one in, what's your reaction? >> we know we're going to make this happen and confident that the market is receptive to us and we're fine. we're good to go. just getting started. >> what about you, nick? >> it's okay. we know we're doing 70%
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commercial sales, calgary, two long standing franchises so the commercial side can be won over and business for us. >> best of luck and thank you very much for joining us on the show. tressa and nick of men in kilts and thank you to our panelists don and julia. and that is today's power pitch. >> two outs, one in. i guess the motto for those entrepreneurs don't cry over spilled kilts. you heard what the panel had to say, are you in or out on men in kilts? follow the kfrg on twitter with the #powerpitch or logon to power pitch.cnbc.com. >> i can't wait to read some of the comments. thanks very much. countdown to christmas, black friday right around the corner. what do americans plan to buy and plan to shop? jane wells speaking with some of them in beautiful huntington beach, california. surf city. >> oh, sue, it's difficult.
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shoppers on the street live in huntington beach, california. over to you, jane. >> hey, sue. it's beginning to not feel a lot like christmas here at the beach where we've got this weather, but talking to the people on the pier or downtown, they are telling me they plan to spend more this year and the consumer federation of america says that's continuing a trend. while the cfa says its survey more say 2013 was worse than better, 29% is the lowest number since they started asking that question four years ago. what are folks planning to buy? apparel, electronics, gift cards but probably not tomorrow. when i asked what would you rather do than go shopping on thanksgiving? here's what they told me. >> stick a needle in my eye. i don't know. it's terrible. i wouldn't do it. >> i think it is a desperate cry for consumerism. >> yeah, i probably will, because we don't do the family thing until later. >> i would rather spend my
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afternoon/evening in the kitchen helping my mother cook and clean than go shopping. >> wow. >> yeah, wow. >> wow. you know, my son wouldn't say that. retailers may end up blaming the weather if this weekend isn't what they expected. they could blame the weather here for the opposite reason. it's too nice to not be outside. back to you. >> it's a beautiful part of the world. well economists say buying tech products during black friday has become the new thanksgiving tradition. josh lipton in san jose, another beautiful part of the world with that part of the story for us. >> yeah, 31% of shoppers surveyed by the consumer electronics association said they plan to buy electronics this weekend. that is what could happen. now the actual number could be even stronger. last year 44% of those who shopped over the weekend did buy electronics. economists say this year tech could overtake clothing as the most popular category. most expect to buy a tablet and
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laptop computers video game consoles and televisions. shawn duebravic chalks it up to gaming and mobile devices and generally improving economy. analysts we spoke to say the hot items this weekend could be apple's ipad, 7 inch android tablets and big screen tvs from samsung and vis yo. back to you. >> all right. stick around. if consumers aren't spending all of their money on electronics what are they buying? will we see a rotation back to clothing and apparel. sara spent time at the mall with a group of teenagers learning where they shop and why and i did the same thing a couple months ago. let's see the teen retailer and how they've been performing since last christmas. abercrombie & fitch down 27% since last christmas. air row postal down 24%, american eagle down 21%. the gang is still with us but sara, let me start with you. you know, those were the hot
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names a few years ago. the abercrombie, american eagle, used to be hot with teens but doesn't look like they are now. what did you find out? >> hi, thanks for having me. the teens i spoke with said that, you know, they're more interested in culltyvating their own personal brand than following the brand that, you know, were the big names in the past. they're not so sensitive to having specific logos or having specific looks that are cultivated by a store. they want to do it themselves. >> all right. you know, when i was at the mall with the teens one of the things that struck me is the use of social media to decide what was in and what wasn't, what was out. the instagram ranked very high. did you hear anything like that as well or not? >> yeah. with the girls i spoke with they did say social media is a factor. big fans of instagram. they're also looking at sites
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like pinterest where they can cultivate and find different pictures of different items they think might fit in their wardrobe. they cited, though, the website refinery 29 as another place they go to look for fashion inspiration and said they -- you know, the girls they go to school with i should say the girls and boys they go to school with are inspiration for their own style. they'll see, you know, if someone is walking down the hallway and have a sweater they like, you know, they'll figure out a way, i like that, and i want to incorporate it in my wardrobe. >> jane -- >> they get some sort of feedback from there. >> that seems to be something that we've seen all along. you know, if you see something that the other kids have, you want to have it. the whole social media aspect is different than when we were shopping and when our friends were shopping? >> well, i feel what's interesting about her saying cultivating your own brand, and we are starting to see that. i think pinterest is huge. that's a big part of that. what i'm hearing from some around here, is they want to
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shop individual stores. that -- people are increasingly saying they want to shop small. that's a big deal. do this weekend. while they will go to a macy's or a banana republic or nordstrom, they're going to stores where there are not brands it's this mixing and matching and making your own brand. >> yeah. and, you know, josh, it's so interesting, the way that technology has changed not only what the teens buy, but how the retailers have to keep up with the way that the teens buy. it's made -- it's a seismic change. >> a huge shift. what's interesting, sue, to your point -- >> that's why i just give my kids cash. >> so much easier that way. i would say, sue, to your point mobile devices you talk to analysts and economists expect that to be one of the most sought-after products this week. to your point, it's the way people shop more than ever when people shop they are going to be doing that shopping on their smartphones, on their tablets.
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it's called couch commerce. that's the new way to do the shopping this weekend. beats the lines. >> absolutely. especially when the weather is not good in most of the country. thanks all. appreciate it very much. happy thanksgiving to everybody. ty, up to you. >> sue, thank you very much. let's take you down for a solemn tradition at the white house. the president is about to pardon popcorn and caramel, two 38-pound, 22-week-old turkeys from minnesota. while they are being spared the ax they are being sentenced to spend the rest of their lives pecking their way on to the affordable care act website. no, just kidding. they're going to apparently spend some time at george washington's estate in alexandria called mount vernon and then they're going to go out to a turkey farm in leesburg where they will reside the remainder of their days. >> yes. you know, ty, you can visit them at mount vernon. visit the turkeys for a two-week period before they go to the
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farm. these turkeys were basically picked by the high school students in minnesota at badger high school and they're in the audience there. and they also helped pick the names, elementary school students from around the country submitted names for the turkeys. i think popcorn and kara plel, that's cute. >> 22 weeks is all these birds are, hardly little, 38 pounds. those birds have gained more weight in 22 weeks even than i have. it's amazing. >> i think when -- when you know you're headed to the white house be. >> yeah. >> you want to put on a good showing. >> you want to fatten up. look, that's a beautiful bird right there. >> that's a beautiful bird. absolutely is. >> look at that. >> 66th annual turkey pardon. >> what does the turkey say? >> gobble, gobble. >> there's going to be a viral video. this is a nice occasion. malia and sasha there with the president. >> i'm surprised -- >> i'm sorry? >> let's listen in. >> let's listen.
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>> this is quintessentially an american holiday and during this time we give thanks to our friends and family for citizens who show compassion to those in need and for neighbors who help strangers they've never met. we give thanks for the blessings of freedom and opportunity that previous generations worked so hard to secure for and we give thanks for the service and sacrifice of our brave men and women in uniform who serve our nation around the world. for those of you who are watching, you keep us safe, you make us proud, and you remind us of our own obligations to build on the work of our predecessors and leave something better for our own kids. so on behalf of the obama family i want to wish everybody a very happy thanksgiving. tomorrow as we gather with our own friends and family we'll count ourselves lucky that there's more to be thankful for than we can ever say and more to be hopeful for than we can ever imagine. before these turkeys get away, with the power vested in me, i
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want to grant popcorn a full reprieve, come on. i want to -- popcorn, you a full and free from cranberry sauce and stuffing. we wish you well and we're going to give caramel a break as well. all right. congratulations, everybody. good job. happy thanksgiving. >> the reason we didn't see caramel there is because caramel is the alternate. they usually have two turkeys. there is one primary, that's popcorn this year. caramel is the alternate. they're both very lucky turkeys today. gobble gobble all around. >> let's take a look at markets in ts terms of gold. prices are closing right now and see where we're headed in terms of the gold market close. all on the downside. comention down 2.80, silver down as well, platinum down $9 on the
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trading session which is one of the biggest percentage moves in a quiet market. to the bond market, weak demand in the latest treasury auction. rick santelli is tracking the action at the km cme. gobble gobble. >> happy turkey day, one that went pardoned, 7 year note option, "d" for dog. it it tells us maturities shorter five and under get a lot more buying respect than the longer end starting around the 7 year. intraday of 7s it wasn't affected dramatically by the results because it was already elevated. two-week chart of tens you can see it went from a one-week low yield to home base 2.75 today foreign exchange rules in terms of interesting moves. look at the dollar yen. dollars crossing the 102 boundary for the first time since may and the euro versus the dollar the euro overtook
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136, hasn't happened since late october. having a problem holding that level. tyler, back to you. >> all right. rick, happy thanksgiving. >> happy thanksgiving. >> statemeame to you, my friend. the dow new highs, russell 2,000 small cap has been the real outperformer. look at the graphic up nearly 34% this year. is this going to continue or will there be bigger gains in big caps ahead? we'll tackle that one when we come back on power lunch. ♪ [ bell ringing, applause ] five tech stocks with more than a 10%... change in after-market trading. ♪ all the tech stocks with a market cap... of at least 50 billion... are up on the day. 12 low-volume stocks... breaking into 52-week highs. six upcoming earnings plays... that recently gapped up. [ male announcer ] now the world is your trading floor. get real-time market scanning wherever you are with the mobile trader app. from td ameritrade.
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now that new jersey has legalized on-line gaming state residents will be able to place wagers from the comfort of their own homes without ever stepping foot inside a casino. will this new law help, hurt the business inside the real betting halls? let's get some answers from the president of atlantic city's borgata casino, tom balance. mr. balance, welcome to "power lunch." good to have you with us. you have gotten approval from the state to set up two gaming portals on-line, one called borgata casino.com and the other borgata poker.com. i gather you're very happy about this. you don't see it as a threat to your core business which is the hotel and casino business?
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>> no. we're really excited about the opportunity. these are great times for the gaming industry in new jersey and i think moving into the future. so this is just really very exciting for us. >> how do you expect your revenue mix is going to change as a result of this? obviously now i take it it's probably 100% in the hotel and gaming there. five years from now, what are your expectations for dotcom type gambling versus in place gambling? >> sure. well actually it's a little bit less than 100% after yesterday. we generated some revenue on our first day of operations on-line. but we see the on-line market as really being entirely a crede to the overall industry in atlantic city. analyst expectations are all over the place. they range from $200 million a year to $1.2 billion a year. we think that the mature business is going to be somewhere in between. >> so you're already up and
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running? you got the approval in the last day or so after the change earlier this week and you're up and running? >> oh, yeah. yeah. we were opened yesterday. we had plenty of people on-line. we had over a thousand people playing poker on our site over the course of the day yesterday and we're just really excited about this opportunity. >> i assume you're winning, right? the house usually wins? >> well, in poker, you're not playing against the house. in poker the customers are playing against one another and, of course, in the traditional casino games like blackjack, slots and rulet which we offer on-line there is a house advantage, of course. >> house advantage. how do you make money in the poker then? if you're playing against other players? how does bore gotta make money. >> poker in brick and mortar and on-line is a commission game. each pot there's a small commission the house gets. >> talk to me a little bit, i can imagine that this space is going to get pretty crowded
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pretty fast. i would guess that you feel and intuitively it would seem because you have a big, well-known respected brand in borgata you would have an advantage. how do you plan to lever that advantage so that you capture more market share versus some of the competitors who are bound to come in and try to do what you're doing? >> yeah. well you're absolutely right. the space will get crowded and there are 12 licenses in atlantic city and they can offer up to five brands each, there could be as many as 60 brands in the market. the bore gotta brand is a powerful brand and most trusted brand in the market. so, you know, we already enjoy in the brick and mortar world a 50% market share in poker and a 20 plus percent schar share in casino games. we believe we will be able to translate our on-line share into reasonable similar statistics. we know all of our customers and everybody in new jersey know us and we've spent ten years
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building a really well-trusted brand we will leverage. >> beautiful place the bore gotta, lovely. >> thank you very much. >> tom, congratulations. happy thanksgiving, tom balance of bore gotta. >> thank you. and hain thanksgiving to all. >> all right. it's bankrupt and people have been leaving in droves for decades now, but is detroit actually the land of opportunity? billionaire investor warren buffett seems to think so. see what he sees he likes in detroit coming up next. you really love, what would you do?" ♪ [ woman ] i'd be a writer.
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jon, riding shot gun today. going to be a lot of fun. join us for "street signs" at the top of the hour. back to you on "power lunch." >> absolutely, mandy. see you in a few minutes. do high state taxes chase away millionaires? some surprising data coming up for you. plus, is bankrupt detroit the land of opportunity? billionaire investor warren buffett seems to think so. power rundown up next. (announcer) scottrade knows our clients trade
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a pre-thanksgiving power rundown. robert frank is here, phil lebeau is there. some of the states, folks, with the highest taxes also have the highest populations of millionaires. rob, you run the numbers on this. >> yeah. >> what did you find? >> big debate whether high taxes chase out the rich. i took a state by state millionaire count and overlaid the tax rates on those. some of the highest taxed states had the most growth in mull it ty millionaires, california number one in glowing multimillionaire population over the past year. the number one state on a percentage growth basis was massachusetts, that's also a pretty high taxed state and number one city for growing millionaires was new york city. with a 12 plus percent tax rate. so again, this could be despite the tax hikes in these places, not because of them.
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but basically this shows little correlation in how many millionaires a state can grow with the tax rates. >> really speaks, i guess, phil, more to the vibrancy of the economy. sometimes the sheer scale of the economy. i guess it should be no surprise that california would add the most. it's the biggest state and certainly has a very vibrant economy for growing millionaires in silicon valley. >> and i think that's what this does say. where the economy is growing, it's where these millionaires in many cases i know robert can talk about this, many of them are entrepreneurs or people who have built their millions and they've done it in areas where they can build a business. so yes, taxes play an important role, they always are for people who are extremely wealthy but at the end of the day they're growing their millions in the best environment possible. >> and florida was on your list robert as i recall at number three maybe. >> yeah. >> obviously a popular state but doesn't have an income tax. >> florida and texas zero income tax states did very well as well. it's a mixed bag, people on both sides of the debate had a number they can show. >> larry kudlow on 93 here.
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black friday just two days away and car sales numbers are expected to be very strong this month. how strong is strong? >> 3.35 to 4% compared to last year and last year was a strong black tri. i think a lot of people look at black friday and only think of the people standing in front of the walmart or target, and waiting for the doors to open and charge in. the fact of the matter is because so many people are off, it's a fantastic time for the auto dealerships. i talked to eerl hesterberg the ceo of group one today, he said they're expecting a very strong black friday, in particular, look for the luxury automakers to have a very strong end of the month because they are all out there aggressively pushing deals. this could be a very strong end of the year for the automakers. >> all of the advertisements that go to december to remember, toyota thon, holidays, do they tempt you to buy? >> every year, i wonder, do people really get a white mercedes in their driveway with
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a red bow on it? turns out a lot do. it's important that we have sort of a tale of two consumer economies and especially the luxury side. i mean the wealthy people i talk to and the wealthy dealers that the high-end, they are really looking at a good couple months ahead. so i think, you know, some of that does happen. people do give cars for christmas. >> i guess advertising works, phil. see santa in a red suit with the red mercedes. >> yeah. >> on all the nfl games. must be bringing people in? >> and if you get a big bows nous and on wall street, what better time than right now because there are great deals out there. >>s especially when look at the markets, that's helping too. >> move to maybe the other end of the weight scale, $15 minimum wage now has passed for workers around the seattle/tacoma international airport. that's the highest in the nation. opponentses want a recount in the vote but if it sticks and seems like it is going to, could this be a new barometer for other states? other states, phil, you're familiar with that part of the world, spent a lot of time out there covering boeing and others, other municipalities
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are thinking about heightening their minimum wage? shi shifl. >> i'll be interested to see the fallout in terms of whether or not there are other areas in the state of washington where people will say, you know what, it's working at seseatac let's try i here. it has a large tack base the airport bringing in all of this revenue so it's a little different model. if you were in a city that doesn't have something like that to attract as much money and revenue you might think twice. >> robert, a captive audience if you're going to travel in and out you go to the sae-tac neighborhood. >> sea-tac can't move and businesses will move if they have to pay this rate. i think it's not an applicable model but the big question is whether other labor unions around the country will start to do this and other towns and municipalitie municipalities. inequality is a huge problem, it tempting to see this as a solution but i don't see it spreading much beyond sea-tac.
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>> the yahoo! finance question of the day. warren buffet saying detroit has huge potential. would you buy land there? 28% say yes, it's a good idea, 53% say no way, and 19% say real estate isn't in my portfolio. buffet likes it. we shouldn't be surprised, robert. he says swim against the tide and he's done very well doing it. this would be against the tide. >> yeah. i would like to see him actually make an investment. it's one thing to say there's a lot of potential there which is a nice way of saying, you know, they're really hurting right now but i would like to see him put his money where his mouth is. >> who know. maybe he has. phil, you spend a lot of time in detroit. are you seeing group chutes up there? the auto industry is back but municipal downtown detroit is a sad, sad sight. >> a few green chutes are there, tyler. a few. i would in the call this a comeback by any stretch of the imagination. look, there are huge swaths of
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land there where you will go block upon block upon block with nothing or just burned out homes and then you see a really nice home. what do you do with that one nice home? do you tell those people they have to move and get rid of that entire area? i don't know what the solution is in detroit. but i think at the end of the day, warren buff if fet and others they see potential there, i want to see the investment like robert was saying. >> thank you very much. have a great thanksgiving, guys. >> you too. >> sue, down to you. >> all right. ty, as we wrap up our program three winners in today's thanksgiving eve trading. we have them all for you coming up next. (vo) you are a business pro.
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a lot of pre-holiday celebrations starting on the floor of the nyse which is probably why we have a modest gain of four points in the dow jones industrial average. the s&p 500 is up just under 2 points and the nasdaq composite under 17 points on the trading session. the russell 2,000 small cap index at a new record high and take a look at that nice chart with a big move to the upside. it's now up about a quarter of a percent. three big winners today, hewlett-packard, very good report from h pshg, jc penney,
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on the upside by 6.3, and cable vision up by 4%. hope everybody out there has a wonderful thanksgiving from my home to your home. >> and you as well, sue. happy thanksgiving to you and your. everybody, thank you very much. we're very thankful you choose to watch "power lunch." >> absolutely. >> that will do it for today. sue? >> "street signs" begins right now. it is 2:00 p.m. on wall street. we have two market insiders here to give us six reasons to be thankful for this record-breaking market. now if you are heading to the airport, there is a way to park for free, but there's a catch and it's a big one. you have to rent your car to a total stranger. is that a crazy idea or is it a smart business idea? plus, we have the three top black friday deals you cannot afford to miss and the retail stocks that you plight want to add to your shoppin

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