paying his fair share in taxes. one of the most notable numbers of the day, a totally misleading dow jones industrial average. it is down at the moment but if you take away the effect of ibm, the dow would be 957 points higher than it is right now. our stat of the day -- we've got two of them in fact. they both point to a stronger housing market. first housing starts hitting a four-year high and secondly, mortgage applications were down, but new home purchase applications were at the highest since june. let's pull it all together and get straight to diana olick. all signs here i pope ahope are pointing to a recovery. >> no doubt. a housing recovery is under way but have to take these big numbers with a grain of salt. purchase applications were up 1% week to week. yeah, they've been up all month on these great low rates but historically they are 62% lower than their peak in '05 and 40% off their average. still of course going up is the

right direction. now to the even bigger numbers. total september housing starts jumped nearly 35% from a year ago. single family up 43%. multi-family apartments up 19%. but it is the permits that are truly stunning. up 45% total from a year ago. single family up 27%. multi-family up 93%. still, total housing starts are about half -- half of what the normal volume is historically. despite these big numbers, the home builders association says just that. they say we still have a long way to go back to a functioning market. in order to get there, significant challenges must still be addressed in terms of credit availability and appraisal issues. a lot more of this and all those reports posted on facebook page. >> diana, please stick around. your lead story today has exactly to do with what diana was talking about but it is the one thing that could kill off the housing recovery. it is appraisals. since new rules went into effect, many of you are saying, this part of the loan process is

the most frustrating and often the most wrong. let us bring in the owner of milkus realty evaluation. diana staying with us as well. joe, people are claiming that the appraisal industry has really gone to pot the last couple of years. your take. >> well, i can understand why people would think that and i could understand the frustration as i have refinanced a couple of times and i know how critical the appraisal is. what we've seen happen is a massive change in the rules, a massive change in how we are engaged to do the appraisals. many of the large lenders now, due to dodd-frank are required to have a fire wall. when they set up the fire wall, it is the form frequently of an appraisal management company. sometimes that's in house, sometimes that's an outside party that's an intermediary between the lender

appraiser. a lot of the problems come in with the process of selecting appraisers -- >> joe, sorry to interrupt, but isn't it troublesome though that you've got a willing lender and a willing borrower, then you've got this third party that comes in and literally can scuttle the whole deal with almost no recourse on the part of either willing party. >> well, there is recourse. the recourse would be for the borrower to go drive to comps, see if they're truly comparable, see if that report really makes sense, does hold water. and if it doesn't, then to write a strong letter to the lender pointing out the problems. or for that matter, they can go hire another appraiser to take a look at it and include that in their critique. >> brian, you really got to remember why these rules were put into place in the first place. because we had appraisals running rampant during the housing boom and a lot of people blame a lot of the problems from the housing boom on appraisals

that banks could just order up any appraisal they wanted to, they could get whatever value they, aed to do, get re-fis, pull cash out. that's how we got flu a lot of trushl. now it has gone a little far on the other direction. trust me, did a re-fi my sif and had the appraisal overruled by some guy in cleveland. we have to find that middle ground again. a lot of realtors are saying their deals are being scuttled or they've had to pay more or less for the house. >> they have little experience, i believe their fees are being cut, and it is also highly subjective. i hear fannie and freddie started doing computerized appraisals. how accurate are those though? >> i think probably track tone may be fairly accurate. many houses aren't track tones and there are inconsistencies a computer model won't pick up. you hit it on the nose. a lot of experienced appraisers have gotten out of the market. quite a few have retired or gone

on to other occupations. . a lot of instances the fees are half of what they were five years ago so it is very hard to keep good people involved. that's definitely contributed to it. when the fees are low you have to generate a lot more appraisals to make a living. you don't have much time to spend on doing reports. >> how do we fix this? do we jack up the fees again? make it more something that people aspire to do? >> well, i would think from a borrowers perspective what i would look at is not just how low the interest rate is but the closing costs and whether they're paying an adequate amount to get a good appraisal. because that's going to make or break their loan. how can you do it on a regulatory basis? i would think for people to speak up on the political process and also to bring it up with their lenders. and be selective on what lenders they go to. >> i agree with you. i want to address what diana was saying. they are running amok naming their own price a number of years ago.

maybe we've gone too far the other way. so to joe's point, what is the solution? more training which of course would then raise prices. anywhere we go we're going to be stuck in some situation. >> what we need to do, it is important to have that firewall. i believe that should be there between the bank and the appraiser. but again going to find these appraisers who are cheaper to do these, you've got to be able to jack up the prices for the appraisers a little bit so you get more people into the business, you get more experienced people. we saw a survey showing that people who are under 30, the number of appraisers is very, very small. most appraisers are over 50. it is a question of how do we reduce this appraisal market, get the standards back the way they should be, keep a firewall but not make it so that an appraiser can overrule or can go into a neighborhood they've never even been into not knowing the schools, not knowing many of the comps and perhaps even comping off a short sale or fork down the block. we need to find that middle ground between ordering what you want and a complete firewall where the appraiser is not getting the real information.

>> diane in an joe, thank you very much nor joining us today. earlier this week we told you how house flipping is back. tomorrow we'll start to talk to the stores of "flipping boston." they'll tell us what they're seeing and if they are making more money now. that's tomorrow at 2:45 p.m. eastern. and what is the one stock that could crush the market rally? no, we're not talking about apple. we're going to find out what it is next. and later on, an incredible story about a big fat tax loophole that you're going to have to hear to believe. maybe new buildings? what about updated equipment? they can help, but recent research shows... ... nothing transforms schools like investing in advanced teacher education. let's build a strong foundation. let's invest in our teachers so they can inspire our students. let's solve this.

okay. let's get straight to the trading floors and find out what's going on out there in marked land. bob pisani, rick santelli. bob, what are we looking at today? >> it is a slow slog upward. again we close at highs two days in a row. not sure we can do that right now but the s&p up another three points. doesn't seem like much but just take a look. 1,465 is the new closing high, we were up at much as 1,460 earlier in the day. you get a very unusual bifurcation here. normally on days when you get a weak dollar, strong euro you get a move up in energy, in financials and materials. that's not that unusual. but usually tech up, we're not getting that because of disappointments a little bit with ibm and little bit with intel as well. some of the big tech names here today, you see what's going on. there's ibm. that's the big weight on the dow. that's why the dow industrials is down and the s&p 500 is up. tough for ibm.

they want 10% earnings growth every year but they had a decline of revenue. that's a little tough to get earnings growth when your revenue is going down. the housing market, the new home sales -- excuse me, the home construction numbers were just fantastic this morning. well above expectations. everything in the housing including building material guys like masco and vulcan materials all to the up side. in just a minute we're going to talk about ibm's predicting abilities for the market. if you are the bread, then rick santelli must be the butter. i understand the 200-day moving average for the 10-year is around 1.81. are we at 1.80 or so? >> right now at 1.79 and change, a whisker away from 1.80. i understand the 0200-day movin average is one of nice technicals to mention. but if you look at this chart you'll see it wasn't until the

back half of 2011 we ever traded under 2% in a ten-year note. right now we are approaching 1.80. many think the problem with the things getting good, like better housing, rising equities, interest rates eventually, despite the fed, will move higher. 2% is the threshold many pay attention to. should we cross that? all of a sudden you are pretty much putting a lot of positions in the fixed income market in the box meaning if you're long you're going to be selling. if you're really wanting to keep it simple, yeah, maybe 1.80 but keep a very close eye on 2%. >> thank you for making it every day that bit easier for us. unless we all had a hot tub time machine, it is really impossible to know where stocks are headed. we said "nearly." because the good guys at bespoke investment group found one-day movements of some stocks actually may tell us where the market is headed in the near term. i don't believe it either so let's welcome in co-founder of

bespoke investment, paul hickey. and arnlg eric wentz. >> we always here when alcoa reports, so goes the market. alcoa was very weak looking back so we looked at every company. in the u.s., how their stock reacted to its one-day earnings report and then how the market performed in the subsequent five weeks. surprisingly, one stock that has a really strong correlation there is ibm. 75% of the time ibm's one-day reaction to earnings is in the same direction as the market over the next five weeks. >> that doesn't bode well for us, paul. >> no. ibm's not having a very good day today. it is actually having its worst day in reaction to earnings since 2003. it's not good. when you think about it, ibm has its tentacles in every area of

the economy and government around the world. when their revenues come up lighter, can you expect to see that kind of reports from other companies down the road. that's what we've been seeing over the last few quarters. ibm's revenues have been coming up light. while the earnings beat rate has been very good, the revenue beat rate hasn't. >> eric, i want to bring you in. when you listen to these kind of stats do you take them on-board in terms of changing your investment strategy? >> i think the market does an excellent job of once a company -- a large company company reports, it effectively prices that in to small and mid cap companies. what we've seen throughout earnings season -- if you highlight ibm, certainly technology sector in general is getting hit pretty hard today especially software and security group, and you can see that this is actually being priced in right away.

there were certainly opportunities to surprise on the up side once the down beat sentiment is priced in to these shares. i think he makes a great point that the market reacts to this, but then at the same time there are opportunities to capture alpha when these companies do in fact report in the coming weeks, small, mid cap names. >> paul is right a lot more than he is wrong. if this is ibm's biggest one-day drop in reaction to earnings in nearly a decade, and ibm three. fourths of the time says where we go, sho will everybody, doesn't that say to you as a fund manager, sell stocks? >> it certainly says within technology you have to be very, very selective with your stock picking and you certainly have to avoid the pc cycle where we've seen weakness from not only ibm but also intel. it brings up a great point how to pick stocks within technology. >> bring up amazon then, paul. i understand amazon has a great ability to be a contraindicater in terms of where the market is going to go. why is that? and will it hold true this round

as well? >> the funny thing about amazon, we always hear how bad amazon is, what's good for amazon has been bad for electronics retailers. but overall what's been good for amazon has been bad for the overall market and visa versa. amazon still has a ways to go before their report but a company with a real inverse correlation, isrg, a surgical. while the stock gapped down this morning, it has been up and down into positive and negative territory. so the finish is negative, that could be a slight offset to the ibm. but if it finishes negative, that's two big companies that reported in the last day that would have a omen for stocks going forward. >> paul, eric, thanks for joining us. let's get a "market flash" now with sew ma mow ema mody. >> discount stores under pressure. street account is noting rumors that dollar tree at a deutsche bank field trip is suggesting a challenging environment for the holiday season and take a look at dollar tree.

it is down about .9%. dollar general down 6.3%. family dollar down about $2. >> thanks, seema. they just did it. nike firing lance armstrong. why did lance get the boot when other controversial athletes got to stay with the brand? and also part three of our alternative investing series. we're going to talk wine today. forget about a bottle or even a cellar. we're going to show you how to get a piece of a vineyard for about 100,000 inn or less. [ female announcer ] the next generation of investing technology

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welcome back. i'm julia boorstin in los angeles. a good day for social stocks. facebook shares have pulled back a bit but were up as much as 5% earlier at wedge partners says the social network is further along in monetizing mobile advertising than consensus opinion. the company is taking steps to drive mobile revenue today ruling out mobile ads, triple mode apps and games. zynga shares are up 2% as it launches its second mobile social role playing game.

facebook and zynga do often move together. today's sunshine, piper jaffray beating expectations on stronger banking and brokerage results. they say a robust performance in fixed income drove the healthy quarter. the chart is up 8% as we stand. >> your disaster dujour, quest diagnostics, lowered expectations for the year, saying there were structuring charges related to a cost cutting plan and to cut into it would otherwise have been flat profit. down today, still the stock up 27% year to date. it is getting more difficult for lance armstrong. nike and radio shack both dropping him over the doping scandal. why is nike dumping lance but keeping tiger woods and bringing back michael vick last year? president of reese and reese. your take on this move, laura. >> well, this scandal had nothing to do -- well, it had everything to do with the sports performance and the scandals

before, kobe, tiger and the others, they were off-the-field shenanigans. that's why nike says this is a sports problem, a cheating problem. no longer, after ten years they finally cut ties with lance. >> now nike's gone. to what extent are they going to drop like flies in terms of sponsorships? >> oh, they all are going to drop. it will be like a dom knee effect because everyone is watching what's nike going to do. nike stuck with tiger because they said we are supporting his sport performance. those brands, tiger and kobe, brought themselves back by playing on the field, by getting back -- >> come on, laura! laura, come on! listen. if you ask the majority of americans the tiger woods situation, the michael vick situation, lance armstrong was a cancer survivor, is going to be viewed below that in terms of severity. the roehm real reason nike's likely dropping him is that he doesn't do anything anymore. right? michael vick is still pretty

good. tiger woods is up and down. but they're still involved in the sport. >> lance armstrong -- exactly. well, he wanted to compete in the ironman and nike loved that and the foundation loved that. but this ban takes him out of sports forever and that's why he's dead. he is over as a professional sports hero. the tragedy, what's going to happen to live strong, can they survive without lance. lance made live strong. people beloved lance as a cancer survivor but they can't now forget him as the most mechanic melodramatic, over the top liar and cheater in ten years. he made ads talking about the fact that he was innocent. >> who cares? the guy survived cancer, everybody in cycling was doping. every single rider that was not falling off the pace was doping. you know what? they're all equal. >> if he only admitted it. if he had admitted it, everybody was doing it, everyone would

have forgiven him. >> maybe come out and done some campaign against doping, maybe nike would have kept him on. right? >> absolutely. look what they did with michael vick. killing dogs. are you kidding me? who likes a dog killer. nobody. michael vick said i did it, i'm going to jail, i'm sorry, and now i'm going to spend my life campaigning to help those dogs. nike said terrific, we'll sign you up. here millions of dollars. lance could have the same thing but he refused. his ego got in the way and he refused to say i'm sorry. we all did it. >> sorry to jump in on your party, but what if both of are you wrong? what if he didn't do it? why would he come out and say he did now? he probably did. the evidence seems to be overwhelming but he's maintained his innocence. other riders could have rolled over because they didn't get to get other penalties on the back end. we've seen that before. >> that's why he was given the benefit of the doubt. >> everyone's been giving him the benefit of the doubt for

over a decade. nike, everyone wanted to believe lance. but a thousand pages, his best friend saying i did it with him! he did it! your best friend does this. everybody was lying except lance? nobody can believe that. nobody. >> do you think that because nike was giving him the benefit of the doubt, that they were basically backing a hero even in the face of various evidence? does it make nyeby look better or worse? >> i think -- well, i think nike made the right move and i think after today they are going to look better and can walk away saying, hey, we finally saw this report, enough is enough. report came out in the daily news saying in some ways nike helped him cover up and they couldn't stand that. that's why they probably wanted to make the final cut with ties to lance armstrong, as everyone else will probably, too. >> laura -- wow, big sigh from a big guy. >> it's just, laura, when lance armstrong was allowed back in to a triathlon recently because

they dropped the accreditation, the entry sword -- and only three people dropped out. guy survived cancer, whatever he did he did, he's still a hell of a rider, beat the best in the world who were also doping. think nike's making a bad decision. people still support lance overwhelmingly is my guess. >> he's a celebrity. he's a celebrity and always will be. he should have forgotten about sports and stuck with live strong. >> i sold all my sheryl crow cds when they broke up. >> laura, thank you very much for joining us. >> i'm burned out now. what do taxes and tatar tots have in common? they're not both delicious. they're both part of an incredible story coming up. the so-called hate tax has the rich fleeing france but they're leaving behind some amazing digs. we'll take you inside some of these chic chalets when we return -- next.

let's look at what's happening in "street talk." cisco trying to fight their way back today. but they're not really winning

this fight very well. >> it's not a fight. maybe they should enhance. cisco systems downgraded to a hold from a buy, cantor saying there is mounting evidence the recovery thesis is delayed another one or two quarters. stock has had a big run the last couple of months. they hit like what? $15 and change back in late july. so it's up. we're going to take a look at tech strong which is kind of hitting some turbulence today. >> turbulence. because they make private and commercial aircraft. they also make easy-go golf cart which in my view is the quality golf cart. tech strong lowered their expectations. they came in lower than expectations. they said they are suffering from some weak demand for corporate jets. right? what do you always say? >> i always say the millionaires and billionaires should get out there and spend more. >> especially on jets. tech strong would like that. >> absolutely. >> they called it a very quiet ordering period for their cessna jet unit.

they make the citation brand of jets as well. orders will need to hold their september's rate for the rest of the year to meet their sales expectations. stocks down almost 6%. >> let's move along and take a look at jude medical which is really today under the weather. >> it is under the weather. st. jude medical. they're sharply lower after weaker quarterly net earnings on restructuring and weaker sales. they caution this morning the fda might issue a warning letter about one of their manufacturing facilities in california where they make some cardiac rhythm management products. watch out for that possible headline, folks. don't be shocked if that risk is realized. >> you have to consider yourself warned on this. i think another contender for the dars ter dujour today -- today puns. stanley black and decker -- swk -- is in the red very much today. >> down nearly 5%. right? lower third quarter profit hurt by a decline in the margins in their construction and do it yourself segment. they cut their full-year

earnings outlook. swk is down. they need some rebuilding. >> need more tools. for-profit education company apollo is really getting killed. this is a segment to bring in herb. hello, herb. they issued down beat guidance but there is really a lot more to this story. >> this is a company and the industry that's going to start to peare itself down. here's what you want to pay attention to. online competition. you're seeing it in one of the most importance most of you do not know right now, what happened two days ago, the university of texas is becoming part of an important consortium of companies that are offering online education for free. but here's going -- >> those are truncated classes. >> no, this is very significant. they're going to allow you, over time, to go back and get credits

for these classes. maybe you'll pay a discounted price but this is starting to grow and that online education that is occurring by non-profit organizations is getting out there in a fairly significant way. university of texas thing very important. >> i have to say with "apollo," sorry, mandy, it is coming back down to earth. enrollment also coming back down. it was down almost 14%. >> the stock is at 11-year lows. >> we always wonder is this the mystery short from bill ackerman. remember what's on "squawk box" a couple weeks ago? there is a lot of speculation. you hear some of these for-profit education names come up. you're shaking your head, sir. >> my hunch is no. i haven't talked to bill in a long, long time. >> fair enough. by the way, we love your stuff. bet reporter in t best reporter in the business. but you got bring some bad puns on this show next time. >> not touching it.

>> we're also just hearing lance armstrong is being dropped from bud as well. a moment ago we were doing our segment he had been dropped by nike, dropped by radio shack as well and now bud apparently -- >> i didn't even know he was sponsored by budweiser. did you, herb? >> no. >> let's bring in seema mody. she's got some news on why vitamin stocks are higher today. >> interesting study which came out today from the american association for cancer research. the daily use after multi-vitamin reduces the risk of cancer by 8%. on cnbc we want the financial angle here. many times we see an influx of americans rush to their local pharmacy or vitamin shop when new studies come out like this. i also did a couple more -- more research on this industry. vitamins, $9 billion market. it is growing at 4.5% overover year. a lot of analysts called this an industry that's recession resistant. we have an aging baby boomer

population. more americans using preventative measures to basically offset health care costs, including vitamins and supplements. as well as more americans are just basically aware of health, fitness and weight management. >> apparently more than 50% of all americans use some kind of dietary supplement and the most popular one is multi-vitamins. i would be really interested to know. this trial was just for men. i wonder whether the same effects would be for women. >> i asked them. they said they have no immediate plans to see if this works on women but i am also very interested -- >> what's your personal take, herb? >> i'm not asking for any reason. inquiring minds want to know. do you take a one-a-day? >> it's called centrium. >> i thought it was silver. >> does that one change the color of things to lime green also? >> let's not forget whether we come to vitamins they've been saying recession resistant. stories keep coming on. they're cyclical. we see them over the years. is just, i would like to say,

the latest. >> it is just one trial but nonetheless, very interesting an it is having an impact on the stocks as well. >> silver. gas futures are also closing at the lowest price of the month. sharon epperson's at the nymex. >> that's definitely the story here in the energy complex. we are looking at gasoline futures that are at their lowest close here since september 24th, it looks like. yes, we've seen oil prices close basically flat here but gasoline prices have continued to slide today. we get an unexpected increase in weekly supplies. that's a big factor. demand continues to fall and we are starting to see some of the refineries that have been in maintenance mode coming back online. the result is a 6% slide in gasoline futures prices in the past week. as well as lower prices at the pump. we're seeing as much as a 10 to 20-cent drop in several states around the country. >> thank you very much, sharon. well, coal was one of the big stars of the debate last night if you watched it. both candidates could not stop

saying how much they loved coal. so now we're going to go to coal country where we're going to ask the miners who they support. some experts even say this entire election could even be decided by coal. the full story is next. t comes , a crash management system and the world's only tridion safety cell which can withstand over three and a half tons. small in size. big on safety. governor of getting it done.

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coming up on "closing bell," two big names in the financial industry weigh in with their latest earnings. we'll hear from black rock ceo larry fishg ank and the ceo of bancorp, richard davis. we'll ask about the big changes in citigroup and their take on that. s&p's chief global economist tells us why he thinks there are three major headwinds for the markets and why there's almost no room for error when it comes to dealing with those issues. we'll see you at the top of the hour from the new york stock exchange. well, coal was a hot debate topic last night with president obama blasting mitt romney's record on coal. >> governor, when you were

governor of massachusetts you stood in front after coal plant and pointed at it and said, this plant kills. and took great pride in shutting it down. and now suddenly you're a big champion of coal. >> so what is romney's record on coal? joining us now, beth daily, environmental reporter for "the boston globe." beth, thank you very much for joining us to try and set this record straight. is it fair to say that he wasn't necessarily against coal per se, he was just for regulated coal. is that right? >> exactly. exactly. romney during his tenure never said i want the coal plant shut in massachusetts. what he did -- actually this event that obama referenced was actually a really big deal at the time. let me take you through it. because he really stood for really strong environmental regulation. it was february 2003 and this was romney's first big environmental stand. he sat up, he drove up to salem and said, look, you are not going to get an extension on cleaning up your plant.

you have to clean it up by 2004. the company, pg and gchlg&e wan extension until 2006. he said absolutely not. he said any time there is a comparison between dirty power plants and the public health i'm going to side on the side of public health. it was a huge story at the time. it was a big firestorm. the mayor of salem, frankly, freaked out. a lot of workers did. romney was booed at the time. the power plant was like 200 jobs in salem and it represented about 13% of the city's taxable income. it was seen as a really big deal. and it really started romney's tenure as governor with a great backing of environmental al advs were really happy. >> put it into perspective for us then. was romney going after that salem station specifically or was there a take-away that this was a bigger picture and maybe he's changed his tune?

>> yeah. so what romney was -- romney was very clear during his administration. he wanted strict environmental regulations on coal. in fact, during his administration, massachusetts passed the strictest mercury policy for power plants in the nation, rules that the epa are now basically following. so his issue was always public health. it was never we don't like coal. that was the take-away point from his entire tenure as governor. it's really interesting, he does seem to have a different tune now. he doesn't seem to be supporting those sort of strict regulations anymore whatsoever. and that's the big change. >> beth, thank you very much for those thoughts. we want to bring in hampton pearson out there in coal country. believe you've been talking with coal miners at a coal mine pretty much all day. what's the feeling out there and who would they support in this presidential election? >> well, mandy, the coal story is really the heart of the energy story here in virginia in a battleground state.

it is really in two parts. there's virginia coal mining, alpha natural resources. they've got about eight coal mines. they're closing three here in virginia, twimi itrimming the we by 1,200 jobs. then there is coal as a centerpiece frankly of power going forward. we're at dominion. this is their biggest var power plarnt. coal has to be at least 25% of the fuel generation mix but they've also got a natural gas option. they also just in the last few months opened a so-called clean coal factory in the heart of virginia coal mining country. a $1.8 billion project. lots of new jobs for the region. so bottom line -- the mitt romney coal argument cuts well here in virginia and in a race that's this close where everything matters. this is where he can make some inroads with say mine workers who would traditionally say democratic voters. back to you guys. did you ever want to buy a

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sink your teeth into some fast food stocks. half of the group trading higher today with the big winner being yum! brands. when we say big winner, it is really up about .3%. >> that's big compared to some. are fast food joints paying their fair share? taxes? reuters out with a fascinating story saying that some chains are claiming intellectual property rights to lower their tax rates. let us bring in reuters correspondent tom bergan. tom, amazing stuff. lay it out. what exactly are some claiming the fast food restaurants are doing with regards to their tax rates? >> hi, brian. yes. basically what we've seen, we went through the accounts filed by a variety of fast food and cafe chains, u.s. groups

operating in europe. we looked at their different operations in france, germany, the uk. what we saw was that in almost all the cases, the local units are paying fees for the use of intellectual property that's basically that basically exists within the hamburger. the unit, for example, of burger king in the u.k. pays burger king in switzerland a royalty for using the brand. now, in one sense, that, of course, is up to the company. you could say where they want to have their -- you know, where the value arises, they may say the value didn't arise in the u.k., it shouldn't be taxed here. of course, the home of the whopper is the u.s. what we've noticed is these fees don't go back to the u.s. they end up somewhat in this corporate ether in places like zurg. >> it's not illegal, is it? it's just a loophole that's there to be exploited. the question is, should the loophole be closed? >> absolutely. we found nothing to suggest

there's any illegal activity here. what we do see is a strong trend in the part of companies to allocate any profits they make to intellectual property. so not to the activities, the factories they have or the fast food restaurants they have, but to the use of the brand or licensing some other know how. i don't know, maybe the secret sauce on the burger. so you'll see that maybe these companies with a 12% margin, but you'll find a big chunk of that is being handed over to other units. >> tom, sorry to interrupt. the earl of sandwich just rolled over in his grave and woke me up. are you saying the whopper, the big mac, they should be treated as patents? >> yes, not only that, but a patent that exists in switzerland. you might not associate the whopper with switzerland. it's not a location renowned for hamburgers. but that is where the right to license the brand exists for

europe. europe, the middle east, and africa. everybody pays fees there. they don't go back to the u.s. if they did, they would face very large taxes at 35%. >> indeed, they would. yeah. tom, we got to leave it there. >> it's cheaper. >> great story. >> thank you. >> thank you very much. well, the french president's war on the rich creating a rare opportunity in real estate. our wealth reporter is robert frank. you have details. >> that's right. now may be your time. you may be in luck. many of the french rich are planning to leave the country after its tax on millionaires. that's caused a huge jump jump in the number of high-price the homes for sale, especially in paris. brokers say there are 400 homes that have just come on the market in recent months priced at $1 million or more. that's a 25% increase. prices are also under pressure, down by around 5% from last year. that doesn't mean you're going to get bargains here, however. paris real estate is still scarce.

that's because the city's building restrictions demand from other europeans who want to be in paris but wouldn't be affected by these taxes. what do you get for more millions in france? not much. $5.5 million will get you a 1900-square foot apartment. that's three bedrooms and two kitchens. a little more pricey, $18 million gets you a little more space around 5200 square feet in an exclusive community in paris with a terrace and garden. if the french riviera is more your thing, there's a pink mansion by the sea. the price there, $45 million. now, all of these properties come with wine cellars. thank goodness. >> that is so french. did i hear you correctly when you said three bedrooms and two kitchens? how many apartments need two kitchens? >> it's not a french apartment unless you have two kitchens and a wine cellar. many of these properties had two or three kitchens.

it's a french thing. >> that is incredible. talking of wine, we sure love to drink it. you can actually invest in it too. and not just by buying up and drinking rare bottles. we're going to find out how next. bob... oh, hey alex. just picking up some, brochures, posters copies of my acceptance speech. great! it's always good to have a backup plan, in case i get hit by a meteor. wow, your hair looks great. didn't realize they did photoshop here. hey, good call on those mugs. can't let 'em see what you're drinking.

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market flash desk. we continue to watch big shares in dollar general. there were rumors they were suggesting a challenging environment for the holiday season at a recent field trip. the stock moved sharply to the downside. now analysts are coming out defending dollar general saying shares are buy rated. still down about 3.6%. >> thank you for that. it is time for part three of our alternative investing series. today we're talking wine and how you can buy perhaps a stake in a vineyard. guess what? you do not need millions. we brought in a fellow australian, michelle reeves. great to have you with us today. >> thank you. >> lay it out for us. how do we do this and at what price point? >> i think one of the biggest misconceptions people have about owning their own stake in the wine industry is they need to own a vineyard, build a winery, and maybe have a fancy tasting room. that's not the case at all.

in fact, most wine that we consume in the u.s. and almost the rest of the world is produced by people like myself who don't own any physical land or vineyards. instead, they buy grapes or they buy the juice, which is wine already made. >> how much do i need to do this? minimum starting point. >> if you were going to be serious, anywhere from 50 to $80,000 would be the place that people would start to take you seriously. you could talk to grape growers or to bulk wineries and look to have your own wine label. >> how active is that of an investment? if i did that, do i feed to suddenly learn a massive amount about the wine business? can i really just help seed others who will then feed that profit back to me? >> i think anything -- like any investment, you have to like what you're investing in, particularly with wine. asman day said, you don't need to have millions to start your own wine business.

you do need to have a good palate. you need to know what you like and you need to be able to trust it. this is a product that's going out there to others. wine is a very personal product. if you like the wine, you need others to as well. >> for some people, it's like a hobby and a passion. at the same time, if it's an investment, you would like to have on roi. what can you expect in terms of roi? >> in the wine business, it's very standard. in retail, it's about a 30% margin markup. restaurants are anywhere from two to four times depending on the market. so most wine producers, whether it's a winery or a negotiator, usually have returns within that 40 to 65%. a bit of a gray area depending on the quality of the grapes and how you streamline the business with your overheads. >> but a lot of risk. mother nature. >> that is the beauty of what happens when you're in the business. you can mitigate the risk. >> buying in different geographical locations. >> if it's a poor season in one

area, you can cut your loss there and focus on production in the other wine region you have. >> sounds great. thank you so much for explaining it to us. >> my pleasure. >> bottom's up. thank you, michelle reeves. >> thanks for watching "street signs," everybody. we'll have something good tomorrow too. promise. >> "closing bell" is coming up next. hi, everybody. we enter the final stretch. welcome to the "closing bell." i'm maria bartiromo at the new york stock exchange. okay, bill, the good news on the economy -- >> which we're focusing on a lot. >> investors trying to figure out what matters today. the bulls and bears in a tight range here. stuck in a trading war. >> yes. >> tug of war. >> i'm bill griffeth. stocks earlier did take a leg down this morning after investors were less than impressed by earnings from ibm and intel. both stocks have been a drag on the industrial average today, but then the good news came in. the housing starts number, the