>> welcome to "lunch money." we tie together the best stories in business news. take a look at the menu. from worst to first. 2013 was a huge year for netflix. 2014 might not be as big of a hit. competition expanding beyond the yellow cab. the real economics behind pot in colorado. we are talking about baywatch. time to shed those pounds. a workout that is fit for a supermodel and the british prime minister. kicking it off with 2014. what better way to do that than

with a massive snowstorm? >> it will not only change from rain to snow, but we will also get ice. look at all the rain working its way up from virginia northward. it is coming into such cold air and that is why there is going to be such a big storm. >> you wonder how bad could this thing really be? >> the blowing and drifting snow is what will make it so dangerous. we are forecasting 8 inches or more in new york. over a foot in areas of massachusetts. >> shouldn't we be a little comforted by the superlatives? what comes after very serious? >> zero visibility is not good. do not travel tonight. that is what we are looking at with air travel. we have seen numerous airport cancellations. looking at some of the airports in chicago -- 198 flights cancelled. newark, 136.

>> is this going to be a multi- day event? >> it is going to be a two-day event. most of the weather advisories continue until friday. a lot of people are still coming back after a long holiday. when you have these advisories combined with the fact that it is a busy travel day. we are estimated between 70 million impacted. >> it takes a lot of snow to paralyze new york city or boston. washington runs for cover when there was two inches. no offense. not like they will get anything done anyway. that sounds a bit harsh. but is there any thawing in washington? john boehner signaling that he may back a series of changes to immigration law this year. the key here is that his aides are talking about support.

in a step-by-step fashion. those who want to see a bill passed -- the kind of thing that the senate has already passed -- not going to happen. >> no big bill on immigration. what about minimum wage action? >> house republicans not really into it right now. democrats have latched onto this issue. they think it is something that needs to move. very unclear on the process though. >> even the president is on board. >> there are airport workers and fast food workers and nurse assistants and retail salespeople who work their tails off and are still living at or barely above poverty. [applause] that is why it is well past the time to raise a minimum wage that is below where it was when harry truman was in office. [applause] >> nothing is ever as it seems in washington politics.

just because one party fights for an issue, does not necessarily mean they are really fighting for it. >> i would expect that a vote will be held. i don't think democrats expected to move or are interested in a moving. i think they want to use it as a wedge issue during the electoral season and try to change the conversation from what republicans want to talk about. >> raising the minimum wage is a popular issue. few actually oppose it, when you think about it. the states have led the way. 14 states raised the minimum wage yesterday. washington was the highest. $9.32 an hour. second in the nation, oregon. in total, 21 states will have a higher minimum wage than the federal law, which is $7.95. 20 of them are equal to that figure. some are below or have no minimum wage. that is a sad state of affairs. we are going to add up all the

money behind colorado's smoking new law -- no pun intended. we will talk about netflix big year and the big challenge that is coming up in media. this got a lot of viewers on new year's day. ice hockey game. the way it should be played. bitter cold, freezing water bottles. the winter classic yesterday in ann arbor, michigan. 100,000 fans watching the toronto maple leafs beat the detroit red wings. 3-2 was the final. they had to stop twice so that snow could be cleared from the ice. check this out. >> quite an event here this afternoon. ♪

>> this is "lunch money." we are streaming on bloomberg.com, your tablet, and your smart phone. it is a new year in media. new content, new cable fee disputes, new viewing sessions. only one thing that millions of americans care about. >> "downton abbey" season 4 kicks off. >> is sybil coming back? that's all i want to know. >> lady sybil is gone. >> are you kidding me? >> no, tom, we are not kidding

you. your long nightmare is over, fans. amazon staged a successful too -- a successful coup early in 2014 -- winning the exclusive streaming rights to "downton abbey." the season will still air on pbs. amazon is now showing that it could be some serious competition for netflix. does netflix even care about the loss? they have had success with their own "house of cards" and their original series. netflix went from second-worst performer back in 2011 to the top performer last year in the s&p 500. with all the revenue and the content, can you call netflix a fourth network?

>> i think so. they have mashed themselves into the living room in a way that other people have not. it is a very interesting model. i think people are talking about netflix. people are getting rid of apple tv just so they can upgrade to apple tv so that they can get apple tv, netflix. >> with all the success, netflix is starting to do something. remember when it spun off its dvd business and changed its pricing model? netflix is testing a new subscription model based on the number of people who can use the account. customers will pay more for additional family members. >> they have got a find a way to make sure they generate enough revenue from each of their users. there is a difference between the number of subscribers and the number of people who are actually using the service. they have been pretty flexible

so far with that ability of people to share different accounts. >> cost an other issue. >> $3 billion going for the content they make available. another $0.5 billion about the marketing campaign. a lot of that introducing the brand overseas. and then fees of use is so important. technology is where they spend a lot of money. >> don't forget about the competition. >> traditional cable still has sports. hbo is doing similar things. they have been doing similar things with original series and exclusive film deals. amazon and hulu. the international players. europe, latin america. there are local services we don't talk as much about, but where netflix is going to be

head-to-head the same way it is going head-to-head with hbo here in the united states. >> what is the bottom line for netflix? competition? content? here is james andrew miller. >> there was a lot of risk to the portfolio. i still think that people are excited about the fact that netflix is a viable place to take your product. to create great shows. you can see kevin spacey in "house of cards." people are taking it seriously. >> tv is the new frontier for netflix. it is also doing a lot of damage when it comes to movies. every year movies will go off- line on netflix. in the new year, you can watch "blue jasmine" on january 20 and "captain phillips" on january 20. these are oscar contending movies. it changes everything. >> it is a mess. it is a mess. i don't want to be a theater owner. it is a mess.

>> you are at the nexus of inspiration with all of this content. with the success of "house of cards" or "downton abbey" or "game of thrones," are the guys that make this crowd -- are they enthused going into next year? >> i think so. i think there is a multitude of options out there. there was a cast member on "saturday night live" -- they have a whole body of work on youtube already. you are not coming out of it starting from ground zero. you have this body of work. there are places you can now put creative content. >> attention all binge viewers it is the new year. you have to watch the same workout that the prime minister gets. there is the trainer. we will show you how he does it. the new business of taking you

from a to b. the car showdown. getting around during dubai's record-breaking fireworks. that turned out to be a challenge. hundreds going to the atlantis hotel were left stuck for hours because police had restricted access. blame the massive fireworks display. there it is. the cheapest advance tickets cost $123. organizers said they are extremely sorry and they will try to find some sort of resolution. but look at the fireworks. unreal. ♪

>> the car sharing business taking off. it is not just about uber anymore. lyft and sidecar want in on the action too. ahead of new year's eve, the ceo of uber decided to explain the surge in prices.

>> if you are a party at 1:00 a.m. and you would like to get home economically, like with a relatively inexpensive ride, wait until 3:00 a.m. it will go well if you can wait until 3:00 a.m. if you need a ride between 1:00 and 3:00 a.m., uber will be reliable, but it will be a pricey ride and you have to expect that. >> people were still pretty upset. understandably so. some uber rides cost over $300 just to go a few miles. their response, hey, we warned you. yes, i know. sidecar explained why his company is different. >> we create an experience for drivers that anybody can become a driver. it has made it very easy.

the same reason why we provide the cost up front is because we require a destination. that makes for a better driver experience. we introduced commute mode. the driver can go to a location from here to the east bay and only get rides that are going their way. these kind of features -- you can get out and give rides that are convenient to you. >> uber takes a 20% cut. what do you do? >> we do the same thing. >> i talk to a lot of my uber and sidecar drivers. a lot of them drive for different services. a lot of them prefer driving for uber. how do you respond? >> we found the drivers love the sidecar experience because it is super convenient, they do not have to have any shifts. they know where riders are going ahead of time. yes it is true that when you are

charging seven times the normal rate, drivers will end up making more during those period's of time. our belief is that riders deserve transparency. they should know ahead of time how much the price will be. drivers deserve that same kind of transparency. >> so maybe uber and sidecar not your thing. there was another thing called lyft. each car has a pink mustache. >> if you see a giant pink mustache driving toward you on the streets of san francisco, don't be alarmed. it is a lyft car that will give you a lift and maybe even a laugh. >> the passenger is smiling. the driver ends up smiling. it helps break the ice. >> lyft is among the new crop of car sharing. >> owning a vehicle is the second-highest expense in the

united states. there has to be a better way. >> here is how it works. open the app, enter your location, and minutes later a car shows up. the average cost is around $10. that is certainly cheaper than a black sedan or a taxi. it helps put cash in the pockets of regular people. he started offering lifts after being laid off from his finance job. he can bring in up to $200 per day. >> i like about the community. being able to help out. >> lyft says it's drivers give more than 30,000 rides a week. it now operates in 16 cities across the country. >> this is the future of

transportation. it is more affordable, more efficient, and more community powered. >> lyft's ceo got out there to help pick people up on new year's eve and he has a plan. >> we want to be very transparent and open about what we're doing. we have capped the amount at 200% for this night. typically, we don't go anywhere near that. also, 100% of the extra prime time tips go to the drivers. lfyt is zero incentive to want to add an additional amount for prime time. it perfectly aligns us with the rest of the community because we are not benefiting at all. >> do you think the consumer thinks a lot about that? if the money is going to the driver or the company or they just saying, look at my bill? >> i think it is a combination. you don't want the cost to go higher.

by not having an incentive to make the cost higher, we will always have the lowest cost. if the primetime incentive is to get more drivers on the road and we are not taking any from it, then the amount going to the drivers will always be more. more drivers on the road for less money. i also think it is important that they know. i think it does matter to the consumer that we are not trying to benefit from this. we are trying to make the marketplace work. >> a personal story i want to share. somebody who recently used uber saw the pink mustache in the trunk. are there a lot of uber drivers moonlighting for lyft? >> we are seeing several drive on the lyft platform. a lot of the time the passengers jump up front and treat the drivers as equals. it is a competitive environment. people are choosing to drive on

all different platforms. >> how about an automated lift? drones underwater. we have drones everywhere. colorado has weed everywhere. it is legal as of yesterday. we will talk about the economics of selling pot. ♪

>> this is "lunch money" on bloomberg television. we are streaming on bloomberg.com, your tablet, and your smart phone. moving pictures, were the video is the story. after spending the holidays stuck on the antarctic ice, 52 passengers are finally free from a russian research ship. they were carried to an icebreaker earlier this morning. now they have to make the journey to the island of tasmania. the 22 crew members will have to stay with the ship until it is finally free. the emperor of japan making a rare appearance in tokyo. he delivered his new year's address today.

he wished japan well and expressed concern for those killed in the earthquakes, tsumani and nuclear fallout. bill de blasio was sworn in as the 109th mayor of new york city. former president bill clinton conducted the oath. weed. need i say more? recreational marijuana began sale in colorado yesterday. >> previously, marijuana was only available as a medical -- if you had problems with posttraumatic stress or lower back pain for example. >> there was a street off the hill in boulder -- it was also available there. [laughter] >> how hard is it to get a license? >> it didn't seem like it was terribly difficult. there are about 350 licenses issued.

18 stores in the denver area had completed that process by january 1. the others were a little bit stoned. >> how exactly do you buy the stuff? >> you can only spend cash. you cannot pay for your weed for medical uses with a credit card or debit card. >> why not? >> the banks or the banks around the country are unwilling to get into that business quite yet. it will not be long, obviously. this is the dawn of big marijuana. >> you make a joke about it, but what are the legs? >> 20 states allow you to smoke marijuana for medical purposes. let's be honest, they are fairly lax about what constitutes medical purposes. i don't know if you should say bs. some people of cancer or late stage aids. some people may need to smoke

marijuana. i'm not a doctor, i don't know. >> you have funny things in your head all the time. >> that is steve miller. >> yes it is. >> he was a toker. >> and a smoker. >> stoner jokes aside. legal pot will be a boon for cash-strapped states. what are the other states going to do? >> when they see the windfall that comes to the state in the form of tax revenues, what that can do -- colorado was helping to revitalize the school system, dealing with infrastructure issues -- have you driven around new york city lately? the worst streets of any city. >> colorado springs isn't such a desperate fiscal state that it had to turn off the street lamps last year. this is what colorado was confronting. i am not saying that it is not

about tax revenue. it is about the adoption. which states go first has something to do? >> washington state is next. >> of course it is. >> what are the legs of this controversial -- >> california. exactly. >> which are the most progressive states? probably california. >> the federal government does not want to see this happen. >> why? >> that is not the case. president obama and the justice department have given the nod. it is an experiment. >> if you have the munchies and colorado, the next story is not going to make you happy. it might be time for little wine and cheese with a touch of your smart phone in san francisco. baywatch. this drone is giving david hasselhoff a run for his money. no sign of the hoff yesterday. in coney island.

2500 brave or crazy swimmers taking the icy plunge. the polar bear club. winter swims since 1903. ♪

>> this is "lunch money." we are also streaming live on bloomberg.com, your tablet, and your smart phone. i am adam johnson. no ipo for chrysler. fiat is going to buy it instead. why the ceo wanted total

control. >> it is what he have been working toward for almost five years since he took chrysler off the hands of the u.s. government as part of the bailout and the bankruptcy restructuring. it is a little more concretely integrated than it was before. the big prize is to let him get the cash that chrysler has and that chrysler was generating and do it to reinvest in fiat while the european auto market is at a bottom, try to kickstart that part. and then execute globally. >> a hybrid electric car that gets charged from the sun. this thing is a ford. the ceo will unveil the new concept car next week. since 80% of the electricity in the united states is generated by coal or natural gas, going

solar makes the car totally green. we are back. a new year means new laws. the federal aviation administration trying to integrate drones in commercial airspace. the u.s. has approved flight centers in nevada, texas and virginia. why these sites are so important. >> this is technology that shows great promise, but it also brings with it significant challenges. what the test sites provide is a structured framework where we are able to conduct research, conduct test operations, and really understand how we can safely integrate these into the national airspace. >> how will these test sites work? breaking this whole thing down. >> the responsibility of the faa is the safety of the airspace. they want to ensure that this goes safely.

the creation of these six test is sites -- they will create a geographic area where these unmanned aircraft can fly and perform different tests. provide that data back to the faa, which will then help the faa work toward building more widespread integration across the united states in the coming years. >> getting chosen as a testing site -- that is a big deal, right? >> the platforms and the technology really had its birthday over 25 years ago. we believe it is in our birthright and as industry starts looking at these commercial and civilian applications, it is important for us to be able to leverage those assets that exist. the technology-based and subject matter experts that exist and be able to extend a continuum and then basically say, now that we have done all this for the

military, there are great opportunities for civilian and commercial application and we wanted that industry to continue to be located here. >> if you thought the faa was the only one testing drones, think again. the real estate industry is getting on the bandwagon as well. robo agents used to take photographs of the property when regular images are not enough. don't expect to see drones on the average house. it is strictly big-time -- at least for now. guess what? we have another one for you. the saildrone. fully autonomous drone. it recently traveled 2100 miles from san francisco to hawaii. tracking sharks on the coast of california. cool stuff. ♪

>> hungry in san francisco? a new app to get wine and cheese

in under two hours. thank goodness. the ceo explaining how. maybe why you ate too much over the holidays. the guy who keeps britain's prime minister in shape. that is next. ♪

>> from wine and cheese to shedding the pounds. three different ways to spend the first days of your new year. first, we are going to celebrate. the president and cofounder of lasso says he can get your snacks to you in two hours. the only catch -- you have to live in san francisco. >> we try to not carry inventory and just connect makers and merchants with customers. >> you are sourcing directly from the makers? makers like point reyes? >> people who put together the platters themselves. in some cases, we will deliver

directly from makers. this is a local cheese, made from cow cheese. the bread is local as well. the wine comes from a jug shop where a local sommelier is selecting the wine. we are looking in major markets. if you look at california alone, it is about 20% of the market. we will focus on california first. >> maybe your new year's resolution was to lose weight. nutrisystem can help. one of the original innovators of weight loss. tom keene spoke with the ceo. >> nutrisystem is for the mainstream consumer. we embrace things like fitness trackers. we see those things as

complementary. those trackers do not offer portion control with meals. they do not offer counseling services. the combination of the two are very powerful. >> the quality of the food has been an issue for some consumers. how are you thinking about that? >> we focus a lot on food quality. we have over 150 different varieties for consumers to choose from. there is plenty for anybody to pick what they would like. what is new is that we have a new kit. it is a new customized program targeted to individuals -- it helps to lose five pounds in the first week. >> i can lose five pounds in the first day, tomorrow, i'm so fat. how will you sell it to boring, lazy people? what is a behavioral thing i will change to use your product. >> i think people go on the program. they have the early success of five pounds and it helps them stay on the program. that motivational factor.

you stay on the program and you work longer. weekends my way, which help you transition back to regular food. it is all about portion control. >> how do you track long-term success? >> we have an online site. people do their weekly weigh an online. we have counselors available virtually 24/7 and ask advice. >> do you monitor how long people can keep the weight off? you have several testimonials. how long do those people actually keep the weight off? >> it varies by individual. we do see that people touch with that early success -- keep the weight off longer. >> it is a cultural thing as well. it is a real sensitive issue for americans. how do you go across different parts of america? the cultural sweep? >> it is different, particularly for men and women. if you look at those two demographics.

women, it is an emotional issue. men don't think about it as much, they want to lose the weight, but they do not obsess about it. >> another way to lose weight? hey man, just do the work. a little work out. you will not get tips for me, but you will get tips from this guy. he gives workouts to the prime minister of the u.k. >> i have changed. i am ready for whatever it is. >> i will give you a ball, first of all. both hands. i want you to do a lunge rotation. step into it. >> this is for people getting ready for party season? >> if you will be trying to recover from post-party season or a preemptive strike during or before it, this will do a lot muscles working very quickly. generally the best thing you can do is high intensity training. there you go.

>> politicians. a-list celebrities. who has asked you to do the weirdest stuff? >> they are all so varied. people who have the biggest time pressures -- the celebrity side, the film stars, the pop stars. the business guys, politicians, it is not unknown for us to work out in a gym at 2:00 or 3:00 in the morning. >> in the mystery meat, the rubber ducky in taiwan has had a tough new year's day. ♪

>> it is 56 minutes past the hour. bloomberg television is on the markets. let's take a look at where markets closed. we saw a pullback for the free major averages. about the same amount each, .8%. the dow jones closed at a record on the last day of 2013.

the nasdaq closed at a 13-year high. all of the major averages pulling back. his is the first time in five years that we have seen a down day for the first trading day of the year. my next guest says he was not surprised by today's selloff and says the picture may have gotten a little too rosy at the end of the year. this could be the start of a volatile trading environment as we wait for resolution of the uncertainty in washington. michael palmer is a trader and he is joining me. people have been saying for a while that stocks have gotten ahead of themselves. why do you think things are changing now that we are formally in a new year? >> we had a huge december, a huge end of 2013 with this moderate bond buying program, tapering being announced. on the news of that, we had a major rally. the debt deal was sort of in place -- excuse me, the budget deal.

it was a huge end of the year. we saw some strengthening volatility at the end of the month. people buying options and protecting themselves. this was not all that surprising. >> what happens now in terms of volatility? what are you seeing in terms of expectations that are being priced in? >> since the summer of 2011, we are moving and reacting to certain dates, specifically the debt ceiling date. we have a date that is out there that is february 7. it could probably be extended beyond that, but not too much. we are going to see a choppy market or people reacting to what happens in congress when they get back next week or something along those lines. the debt ceiling is going to be a big story over the next six weeks. >> what about the jobs report coming out next friday? what activity will surround that?

>> a while back, the jobs report would be a big deal. if the percentage went down, we would say now there is a higher likelihood of tapering. that is not the case anymore. a moderate tapering program is already in place. i do not think the market will react to this unemployment number like it once did. i think all eyes are on what is going on with the debt ceiling in early february. >> i talked to a trader earlier in the week who thinks we are in a cycle where we will remain relatively range-bound with subdued volatility. what is your take on that? >> that is the nature of what insurance is anyway. ebbs and flows within a range. it is really expensive when you really needed. there will be huge gaps to the upside and a moderate range for most of the time. this is ultimately the cost of insurance for a portfolio.

i agree with them. i do think we will have a range bound until we have a big event or something that goes on that gets the vix into a tizzy. >> that will be good for you guys, i guess. thank you so much. we look forward to that tizzy. i am julie hyman. ♪