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tv   FOX Business After the Bell  FOX Business  April 12, 2013 4:00pm-5:00pm EDT

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nicole: it is a name that is continually beaten down. shareholders and others putting up money to save jcpenney. ashley: the bells are ringing on wall street. not exactly finishing on an up note, but it could be oh so worse. basically flat on the day. liz: that is amazing. ashley: incredible. you want to talk about resilience. the nasdaq also down slightly, and the russell off half a percent, but all things considered, not bad at all. liz: and we got the disappointing retail sales missing estimates. consumer names outperformed today. a few widely held names hitting new all-time highs. how many of you own disney? mcdonald's and wal-mart. ashley: the real action, my
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goodness, within the commodity pit as gold and oil sank like a rock. settling at $1501, that is the lowest levels in 21 months while oil losing more than 2% ending the day 91.21 per barrel. liz: once again, they fled to treasuries. 10-year yield falling to 1.72%. of course the move comes higher on the heels of three days of losses. "after the bell" starts right now. ♪ liz: now that's amazing to see the dow went flat at the very last couple of minutes we have been down 72 points. ashley: would we get the much talked about direction? forget about it. chief investment officer,
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international stocks providing the best opportunity. riverfront investment group is here with his famous stock picks, and you want to listen to his stock picks. not bad. and in the pits of the cme. scott, i think this is remarkable, this market so resilient, all the downward pressures today basically where we started the day. >> this is almost a repeat of last friday, if you remember. starting to rally back, we saw the same thing today. wlet me point something out to you. the fix, the fear index, unchanged today. the vix futures down today.
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liz: is almost below 12. that is unbelievable. if you look at the actual vix, 12.07. there is no fear, traditionally that would be a market top, no? >> you are absolutely right. we have spoken about this so many times, there is no reason not to stay in this market in the stocks that you like. you take a little off the table by buying protection, it is too cheap not to. like you said a few moments ago, gold is down to levels we have not seen since july, august of 2011. every time we have seen the volatility spike like what we saw on the kind of the volume we have seen today, over the last 18 months or so, a quick snap reversal. if we don't get that, traders are telling me 1400 is really
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the next level. so one of two things. this volatility is telling us we're now going to trade in a real consolidated range possibly over the coming weeks, or another leg down. ashley: that brings us to our next two guests. chris, look, you're looking at great opportunities. you believe there is really no major corrections coming. what do you think of what scott bauer just said? >> i think that is likely to hold up for stocks, will perform strongly. liz: a narrow trading range at this point? >> we have gotten so much of a return, it is likely this year we probably earned quite a bit of the returns for the year. we still think stocks will have some upside for the rest of the year.
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ashley: you say the best value is overseas. where exactly are you talking about? >> specifically the best value we see anywhere right now is japan. it is not just that it is a good value, but it is a good value with a positive catalyst, that being the messily accommodating central bank action that we have seen. japan was a great value for 15 years kept going down, that is because most of the japanese companiecompanies were value des and that was for a number of reasons, not the least of which constantly global exporters constantly fighting a head wind with the yen being as strong as it has in the last 10 years. we're getting complete reversal, up to approximately 100. all these companies, toyota and nissan go from constantly fighting the yen, now it is in their favor.
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i think they become very competitive again, that is what is happening a lot. liz: what in there do you like in japan? >> the way we play international is being diverse by playing dts. the most important one i think for individual investors owning any tf really helps you minimize the idiosyncratic risks. liz: do you have a favorite? >> yes. a lot of people look at the chart of dxj and wonder how it can go any higher, but look at the japanese equity returns and you will see japan has underperformed the world index by 60% since the peak in the late 80s. if you look at the recent blip up in strength, it is just a
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blip. ashley: let's bring in tim. look at the emerging market. i don't know which emerging markets are delivering right now, which ones do you like? >> broadly it looks attractive. you have the big market like china, brazil and india. the thing about emerging markets is five years ago they were the most extensive asset class across equity spectrum even trading at a premium to u.s. stocks. now it is completely different after a couple of years of underperformance you have emerging market stocks trading well below u.s. stocks in terms of price to book, price-to-earnings. a well diversified u.s. market and international small companies are trading at about a 20% discount to the book value, one of the best price asset classes for growth in the world.
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so we like those areas and getting broad exposure. when you see those values it is a harbinger of performance. liz: omnicare about up 20% year-over-year. dollar tree pretty interesting, flat year-over-year, but year-to-date up 16%. i look at that and start to get worried, or people jumping back into i can only pay a dollar for something, is that an indication of anything more than just opportunity? >> those are the guys that came up with the individual domestic picks. what they are seeing in dollar tree. we have held the very long-term holding for us, now we are back in. i think what we are really seeing is the resilience of the cash flow. one of the business models almost regardless of the econo
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economy, it is because of the dollar store format and because they have been broadening the product range out, and frankly they have things people want to buy, even things they can shop in places that are not a dollar format. the heavy characteristics we look for in stocks in general which is strong cash flow and a desire to give some of the cash back to shareholders in buybacks or stock dividend. liz: have a good weekend. scott, we will see you for the s&p futures close. thank you guys. ashley: finally a victory for jcpenney's. ruling on the use of martha stuart products. did the investors really buy it. liz: we know diamonds are a girls best friend, but could they be your portfolio best performer? how to get in o on the action without shelling out thousands of dollars for a big, shiny
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rock. and the future on diamonds, is a diamond find a good alternative investment to bonds and stocks? we will read some of your answers next. [ indistinct shouting ] ♪ [ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪
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liz: jpmorgan and wells fargo were not the only two banks in the spotlight today. mp bank dropping. we are seeing all of these and more with nicole petallides on the floor of the new york stock exchange. nicole: so many of them, the banking index to the downside. they are supposed to merge, not in it a little bit more time to meet all the regulations that go along with it. they both finished to the downside. they're supposed to be merging together, but they have to wait
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to complete this deal raising concerns about the money laundering compliance program. a joint statement by the two banks together. already commenced major initiatives including the hiring of an outside consulting firm to fully address the federal reserve concerns, so both of these banks are working together, working so hard to push the merger through and meet the regulations the federal reserve is announcing. back to you. liz: thank you, nicole, very much. ashley: let's head back to the pits of the cme. what do you see? >> lets hit repeat from last friday. everybody is short covering. the fear out of here, the momentum was actually going to be down, but with a rally at the end of the day, everybody is covering their short, that is why we saw the s&p pick up a little bit, nobody wants to be short going into the weekend.
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liz: that is what they do, they get panicked over the weekend. thank you so much. try to relax. i don't know how the traitors sleep at night. ashley: wells fargo and jpmorgan kicking off a burning season kicking off before the bell today. liz: adam shapiro looking behind the headline numbers. adam: we talked last time about mortgages, jpmorgan from 900 million same time last quarter up to 673 million. now look at what happens with business loans drawn 20% from the prior year. jamie dimon raise a red flag of what is happening with the economy and small businesses. small businesses remain cautious about the recovery and fiscal uncertainty and are not investing their capital. one of the reasons jpmorgan
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stock was down today. wells fargo reporting, and home loans, mortgages account for 13% of their revenue. they fell, it is quite remarkable, originations down, that is a drop of 16 billion from the prior quarter. you look at applications. that is the story behind wells fargo and jpmorgan chase. coming up next, lots of tanks will be reporting in the financial sector. we will hear from citigroup, goldman sachs, anybody who is anybody. ashley: we have seen that show up. speaking of homes and mortgages, do home prices have eager to jump into the housing market? some who say not so fast.
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when it comes to prices and what you see isn't exactly what you get. liz: the doctors are down a pretty penny after this big brawl. did you see this? that is costing somebody, clearing the benches. thank you orville and wilbur... ...amelia... neil and buzz: for teaching us that you can't create the future... by clinging to the past. and with that: you're history. instead of looking behind... delta is looking beyond. 80 thousand of us investing billions... in everything from the best experiences below... to the finest comforts above. we're not simply saluting history...
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ashley: time for a quick speed read. some of the other top headlines, linked in is buying newsreader and mobile content company for
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$90 million. developing newsreader applications. twitter new music site is live with limited access pit allowing users to log in with their twitter potential credentials. starbucks ethnical mention lowering the price of 12-ounce bag of coffee by 12%. cutting cost to stay competitive as commodity prices ease across the country. nissan raising employee pay in mississippi and tennessee. the automaker says the increase wages. viva targeting consumers by offering a high credit card limit the front of lines. available to consumers using visa signature credit line.
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ashley: to the edge. record low interest rates and stabilizing home prices may heavy want to jump into the market and become a homeowner. liz: before you do, my next guest says watch out, he describes what we are in as a carnival fun house of mirrors when it comes to home affordability and what you see is not what you get. let's get him to explain that. chief economist at zillow. what right now do you say is the most distorted piece of data in the housing market? >> the most distorted piece of information is when you look at affordability in the house market right now, affordability based on home prices combined with mortgage rates, uc affordability is 37% better than what has been historically, but if you take away the mortgage rate side of the equation and look at home prices relative to income, they are almost 15% more overpriced than they have been. our strong sense of ability
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causing the market to see robust appreciation is driven by the very low rates and once rates go up to the higher levels, things will look fairly expensive again in some markets. ashley: i you say homeowners are spending more of their income on their mortgage than in the past. i think that is a good thing, right? you say no. >> in terms of the messaging, have a separate the buyers right now what is in their incentive versus longer-term perspectives. for any buyer right now thinking for the long-term, i encourage them to buy a house because basically the fed is marking everything down by pushing mortgage rates down, what i am concerned about is any buyer who gets into the marketplace with more of a short-term perspective expecting appreciation to go on, rates will begin to slow down. liz: where the city areas beginning to feel a bit frothy right now?
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>> some of the hardest hit markets like san francisco, san jose, phoenix, lots of southern california including san diego, l.a., again they are very affordable right now, but if you look at the affordability with 6% to 8% interest rate or in terms of price to income ratios and what people have paid for housing relative to their income, they live quite expensive so people will wake up when not day comes and say those are bot a lot more expensive the thought. liz: we just showed where it is lower than the norm, cleveland. you look at some of the depressed areas like detroit, so you say people have better values if they were to buy? >> markets like cleveland, cincinnati, detroit, even atlanta, there is a pretty strong declines in the housing recession and have not had a brisk recovery yet and they are
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at historically high level of affordability however you look at it in the equation or out of the equation, basically they have overcorrected and homes are very affordable and there is no risk for those markets i guess getting ahead of themselves. ashley: how tough are the lending standards right now? certainly on the refinance side have alreedy done it because the rates are so low and yet they will stay that way for a while, they will rebound but with such tough standards, how many people can get access to this market anyway? >> definitely living standards are tighter than they were in 2006. if you view the standards over longer-term perspective, they don't look that crazy relative to 1990s standards. documentation requirements are higher. we will see increasing standards over the next year. now that home values are no
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longer falling. the fact the asset against which they are lending is falling in value, and that is no longer the case. liz: thank you very much for joining us. >> thank you. liz: it makes me think there is not a bubble. we will see. another rough day for jcpenney is a victory over macy's in court didn't do anything for the stock. ashley: $657,514, and it wasn't on hiring or even ceo salaries. we will tell you where the money went and why it might just make shareholders angry. @
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♪ ashley: is the tide finally turning for j.c. penney? the retail victorious. liz: live outside the courthouse here in new york city with the latest. >> reporter: contemporary wind and can indeed, a victory today. a judge in the new york state supreme court ruling that j.c. penney can, indeed, sell those
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goods under that jaycee p. every day label good designs, the stuart. of course, this deal that former ceo runs out some of j.c. penney struck with martha stewart really put martha in the middle. this is what went down over the past year or so in the hotly contested the, highland and closely watched court case. first, macy's has to deal with my the stewart, an exclusive deal into does a six renewed until 2018 to design what the steward branded home goods exclusively from macy's. then in 2011 j.c. penney's struck its own deal with martha stewart to design home goods under the eds acp everyday level. well, macy's attacks suing both. today a judge ruled that j.c. penney is the winner for now. also noting that j.c. penney stock performance and business have been so costly that the judge considered the ruling and averse to j.c. penney's more collateral damage for the
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company. and if you take a look at the stock chart, you can see, j.c. penney's stock over the past year is down big time. in fact, it was down another and a half% despite is favorable ruling. the only winner as far as the stock chart is concerned and all of this is, in fact, macy's. macy's stock today also finishing up just a little bit. ashley: thank you very much. liz: yeoman's do the hour after hour. thank you. the victory was not the only headline. the company is in talks with blackstone, we knew that. there is a new name that is also emerging. the question is, is anyone's shocked that j.c. penney needs to boost its cash position? the company's cash balance was down 30% in february of last year. ashley: last night the talk was that it needed a billion. this morning that amount was dropped to 500 million. with us now, bt ig, director of research.
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it they do so much for being here. we have martha, macy's, debt, ceo ron johnson. for whatever reason you still like this name. like the stock. why? >> i do. i think they have a lot of options to expand their liquidity of the next year. number of different beverages including the credit agreement and the ability to finance with blackstone, their ability to design get a mandatory convertible offering less of their ability to finance a number of ways. ashley: but they brought the ceo before ron johnson. he could not get it on. what is his function? >> i think he would point out one of the more successful businesses has been support, which he introduced. already a business that he introduced. in that think it would also be argued that his relationship which is pretty critical at this point, a longstanding relationship with them, and that's important for stability.
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liz: you began by saying they still have a lot of options. let me push you on this. i don't expect analysts to be perfect or have crystaled appalls, but you are always got . you have to buy at $22. we are now at $14. this thing has dropped like a rock. anyone who listens to that has lost money. my question is, do you feel like in a way maybe your eyes glaze over? he is going to, but some great ideas. he really angered a lot of old time j.c. penney customers. >> the absolutely did. but actually, roughly about 1553 people are under water. but its exit $22 commanderies and one based on that unnecessarily. when i initiated an even if he steps out and even if he leaves there is enough recoverable value to be able to turn around. one of the things i did mention, probably should have emphasized more is the fact that the
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pricing strategy was an absolute disaster and the need to change that radically and move back as customers. winning back the customers is the essential part of any strategy they put in place. ashley: forget the customer in the store. that is something he clearly did not learn. you say his ousting was somewhat have parted. are you saying that, perhaps, j.c. penney did not want to do? >> it is interesting. the end of the last quarter, down, they say we will stick by him. several weeks later this it can actually, they're not doing good. liz:, populated in the whole company. you like the real estate and the opportunity beneath the actual stores. we know that blackstone is going to be helping them figure out a way to find some money. so is centered you, supposedly jumping in to help. are they just shining this thing up for bankruptcy? private whatever. me, what is the worst-case scenario here. >> at the worst-case scenario, you can talk about that kind of outcome, but the goal here is to avoid that for retailer. that is not what you want to do.
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keep yourself alive. bankruptcy is not an option here because they have liquidity. have sources of liquidity. they have no near-term majority that will put them in a bad turn situation and the bondholders' right to issue a notice of default that there were forced to resend because they simply had no grounds. i think with the need to do is raise a lot of cash, and they can do that with those options i mentioned earlier. ashley: you're comfortable? >> to lend stability to the firm. ashley: that's one thing, but to push the product forward. >> it's a good point. my target is based on more than getting back to a medium level success, not the height that he had envisioned about getting back to where they had been, even if that is kind of considered not all that great. getting back to where they have been would be an important for step. liz: is there any other name that you like more than this up there? >> one of the names i get in a different sector, the lng. i've been following them for a while. an enormous opportunity.
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natural gas exports base. highly indebted companies. that is another one of the names that i cover. ashley: very interesting. one last question. is there anything that would make you change your mind that this is not going to work? >> at this point and if they fail to execute the liquidity in the see that they have the ability to go out and perform and do something in because of the hesitancy that we saw earlier, that would give me a lot of worry. liz: thank you. ashley: appreciate it. liz: diamonds are a girl's best friend, but they also add sparkle to investor portfolio? a way for you to a profit without shelling out big bucks for big rocks next. ashley: tell us what you think reconsider investing in diamonds as an alternative. we will read your comments later this hour. ♪ everyone's retirement dream is different;
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♪ >> reporter: i'm adam shapiro with your fox business brief. as the major averages pulled back after two straight days of record runs, six stocks including home depot, mcdonald's , and travelers it is. thirty-one stocks also hitting record highs. american workers cannot entirely by the new health care reform. employees sponsored health insurance has fallen about 10% in the past decade. employers have been dropping insurance coverage and efforts to sell up costs. the kool-aid man is getting a makeover. come monday you will get a new personality. computer-generated celebrity trying to show he is just a normal guy. the campaign comes as kraft food looks to capitalize on the new kool-aid liquid makes command that is the latest from the fox
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go national. go like a pro. ♪ liz: soaring demand not just for stocks, but four diamonds as well. that is happening, and it is thriving diamond prices higher. after about 12% in 2012, prices are now up about 5 percent over just the first three months of the year. listen, the physical joule can be very expensive and always a difficult proposition, so we have a new way for you to add sparkle to your portfolio without forking over lots of cash. joining us now, the pure fun ceo running and to relatively new etf with the ticker symbol perfectly named james dementia mess. good to see. first of all, before we get to what is in this etf, how did you, but this idea? >> the key for an easier way to invest in diamonds, traditionally very difficult to invest and physically because
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they lack. they all have different characteristics and values. the traditionally there has not been a lot of liquidity in the physical data and market. we look for ways to invest in by mr. the industry, companies in the industry. we created a fund that includes miners and retailers. liz: miners and retailers. the less talk about some of the names that are in there. one of the most famous diamond names. now has a different name. that is in there. the u.k., you have all of these names along with bhp bulletin which is a minor. >> correct. we tried to make the fun as pure play as possible. harry winston they change the name. the largest pure play minor in the world. they had a retail. they sold the retail assets often they're focusing strictly on mining, which was a good proposition because miners have margins. the retailer is producing about 8%. they're going more money focus. as one of our favorite names.
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liz: your fund is down about 4 percent year-to-date. prices are coming up by 5 percent, why do you think your fund is still down? >> i think there has been sell-off across the whole hard as that camino, natural resource base. i think we have been affecting the status. diamond price has held up quite well. traditionally is the most volatility. liz: hikes of two things. there was a big art heist and there was a big diamond heist. and to me that shows the desperation on behalf of people who really are looking for what is valuable. right away, now is tools that are really, really valuable to certain people. when you look at that, does that send you -- send you a signal? >> people want hard assets, physical assets that they can hold. liz: he was the picasso. >> and 70 right now. people want this bill, hard assets. liz: the damage price history that we have upon the screen. and in the past diamond prices have simply moved -- it was almost like a lock, like they
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have a lock on it. but it is basically true. but now you say prices are moving and really -- real fundamentals. >> a structural flaw in the industry. the monopoly. liz: the opec of diamonds. >> exactly. liz: you see there market share has now come over the years, gone down. liz: exactly. liz: the chinese, indians, israelis? >> competitors that do not want to participate in the model. that is essentially what led to the collapse of the monopoly. for the first time 100 years the market is being driven by forces. liz: i find that absolutely fascinating. because you see blood diamonds, all of these, of course, for so long they did have that mark. but now they don't. you know, what do you think happens in the future? out you get into this fund? a very small number of assets under management, just under 2 million. you need a better p.r. person or
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people just need to be aware or start to believe that the diamond opportunity is something that could really be of value. >> the interest has been good. it is going to require a certain amount of education because it is good enough. it comes without explaining why there is a strong fundamental story. diamond prices are expected to rise as 6% annually in supplies will only rise. there is a really fundamental story. liz: and need to tell the parents right now. here is this guy who runs the etf fun than he has no negative ring. no diamond encrusted anything. good to see you. it will be watching. your fund ceo. ashley: thank you very much. well, super sizing in spending by more than 650,000. hopping mad.
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>> i want to bring it to mainstream. decorating cakes in chicago. why is this important? we will be back in a moment and tell you. ♪ ...amelia... neil and buzz: for teaching us that you can't create the future... by clinging to the past. and with that: you're history. instead of looking behind... delta is looking beyond. 80 thousanof us investing billions... in everything from the best experiences below... to the finest comforts above. we're not simply saluting history... we're making it. are you still sleeping? just wanted to check and make sure that we were on schedule.
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♪ liz: what color the markets read earlier this morning were the retail sales numbers. for tens of a percent for the month of march showing the biggest fall since last june. ashley: jeff flock has been patrolling. and joining us live with more. >> reporter: reflecting on the retail sales numbers at this hour, and as we often do, we want to focus on the positive. i would get to the negative in a moment, but first our restaurants and food. that was a positive. other things were down. i am going to interrupt the cake decorating class in chicago. it is a place called give me some sugar. can i interrupt you. this is one area of the economy. last month the performed well. makes sense. >> absolutely. >> a lot of people, you peak t-72 plot to make cakes. >> we teague spend decorating tips. she did a really beautiful job on her cake.
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she could compete with take pause right here. >> reporter: take a look at the restaurant stocks. on the rise. all up-to-date. you look at the overall retail, they have done pretty good. i want to bring somebody else and. he runs a company. what is it? >> an online marketplace for you can buy digital gift cards to places like this. >> reporter: one of your clients. >> correct. >> reporter: give me a sense of where you think this economy is going? >> the independent retailer like this has a unique product offering, we are seeing it go up i understand they're having trouble. she is actually standing upon taking retail sales as well as a couple of other merchants. >> the big guys up so much. a big run-up. will this continue? it's a good question.
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that's not bad. the last time you were kind of challenge to above the one which other. >> people like her training you when it's all good. >> reporter: a car two hours ago on the call from someone in virginia coming to chicago to learn how to decorate takes. i know you already know how to do this. liz: yeah. it's called call a body in hackensack or hoboken. forget it. no. >> reporter: hoboken. liz: should doing a very nice -- nice job. >> reporter: we will get them a show before we are done. liz: some made the list of the most damaged brands in the country. the website came up with a list of what they perceive to be the most damage to brands in the entire nation. elected companies and aggressively promoted a product or a business strategy but failed badly at that were companies that were involved in our corporate personal scandal. in third place, and i motors, as
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-- the south korean car company was charged back in november last year for false mile per gallon claims. they just announced a recall. shares gina seemed to be hurting too badly. of more than 30 percent of the past five years. number two, apple. ceo tim cook, it dropped the ball when it gave up googol maps and tried to employment its own product which launched to a roar of user complaints because it did not work or there were some bizarre things in those maps. but shares of the company had been feeling the heat. they were done today more than 30 percent of the past year. ashley: let's get to the first place. the latest update on the j.c. penney battle which threw her on to the front page. let's not forget that short amount of time she spent in
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prison, although shares of the company are still surviving, and probably of more than 25 percent of the past year. never counter out. liz: okay. ashley: the l.a. dodgers taking a hit on the $147 million investment. he get out of the way. that story when we go "off the desk." liz: key deedee coming out next week that could move your money. watch your money. we are going to tell you what to watch to do that. stay here. ♪
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(train horn) vo: wherever our trains go, the economy comes to life. norfolk southern. one line, infinite possibilities. how old is the oldest person you've known? we gave people a sticker and had them show us. we learned a lot of us have known someone who's lived well into their 90s. and that's a great thing. but even though we're living longer, one thing that hasn't changed: the official retirement age. ♪ the question is how do you make sure you have the money you need to enjoy all of these years. ♪
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>> welcome back, we are getting breaking news of an earthquake, a strong earthquake off the western coast of japan, 422 -- 42 miles, in the depth of the ocean of 3.# miles, initial readings, no dodge, but we'll watch it, a part of the world used to strong earthquakes. we'll see if there's anything more that develops on that. all right, time to go off the desk. talk about the expensive hits. we've talkedded about it all day. a mound clearing brawl. it broke out between the padres
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and dodgers. got a hit, wrestles zach to the ground, and after being hit by the pitch, zach, rather than getting out of the way, put the shoulder into it, got a broken collarbone. they signed the pitcher to $147 million contract, not known how long he'll be out. >> we did try to contact peter, a guest on the show, also part owner of the dodgers, no response yet. off the desk, talk about extra cheese, according to the fcc filing, wendy's paid $657,514 for the chairman's personal security last year, wendys on the week for that. the money used to pay for certain, quote, security services, including guards and equipment for him and his family. now, over the past three years, wendy's paid more than $1.7 million for security for

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