for a body in motion. do not adjust your television screens. you are hearing correctly on the radio. those shares are getting hit that hard. best buy losing nearly one-third of its market value right now. and multilevel marketing firm nu skin enterprises down 34%. it has been halted already a couple of times today. two separate stories here, but we have got them both covered for you on day where the retail wreckage is strong. mandy? >> indeed. kick it off with nu skin and herb greenburgh following this story. yesterday you raised the red flag. it was just that. the china people's daily making

allegations about nu skin. when you consider that is the government's mouthpiece, essentially propaganda arm, an investigation was sure to follow? >> yeah. that was the key point. because you had a story that had the backing of the government and now you see the results today. kind of interesting, because this morning the company was telling analysts, this is just an inquiry. no. it's an investigation and they're doing their own investigation. this is significant in china where multilevel marketing as we know it in the united states is banned. so in china, they have a totally different structure. retail stores. but the question is, what happens when you get out into those provinces, and to me whether it's nu skin or any of the other companies doing business over there as well as multilevel marketers, look at herbal life, saying, by the way, it conducts its business properly. can they control their distributors? the question. what it comes down to when dealing with these companies, and were there always so many police within the company, so to speak, to take a look a. herb, i

understand your relationship and connection between all the mlms, right, usnaa. we get that. don't throw the baby out with the lavender scented bath water. these are different copyies. your buddy notes in a note today, greater china accounts for about 50% of nu skin sales and only 11% of herbal life sales. eastern if the same thing occurs, there's going to be very different corporate impacts. >> well -- tim is correct, and as i write on thestreet.com this morning, 11% of herbal life sales but grew by 77% last quarter. it is a huge growth area for herbal life and it is something herbal life and others are looking for as another level of growth. so you could be cutting off a significant level of growth if there were to be a problem there. >> talking of herbal life's impact. seeing impact on stock down 10%. nu skin down about 33%.

herb what do you think the market is factors in here with regards to nu gin are they suggesting a possibility that they could be closed down in china or just have a massive fine? >> i don't think anyone really knows. i think, look, people are reacting. wall street does what it does. reacting to the news the way it is. in this case, where the company doesn't steam have handle on it. in china, the way people in china put it to me, they can kick you out and they can do more. so you know, people are -- >> there's not much recourse you can take in china. what have we seen in regards to other companies that have done similar things? china? not much of an appeals process? >> analysts, tim ramie out there telling people today, this is no different than, say, a mead johnson, problems in china and paid a fine. so, you know, is this going to be a fine or some other quote/unquote payment that companies have to make, do to make this go away? no one really knows. i will say something interesting here. a lot of the companies, in fact,

if you go back in herbal life's last call, we received new licensing. you have to be licensed in every province as a direct seller. we received licensing from these new -- licensing and the licensing is like a good housekeeping seal of approval. look at nu skin, talking about the same thing. how many licenses they have received, and because that, that should suggest that everything is fine. as you can see now, just having the license doesn't mean anything. >> it is not the good housekeeping seal of approval necessarily. i liked your point on mead johnson. in fact, pressing herb, later on in the show, talk about that company and whether or not nu skin could dough the same thing. stole our thunder even out in san diego. good work, my friend. see you in 30 minutes. actually, you're sticking around. the other big story today, best buy, looking like the worst. tanking after reporting same-store sales over the holidays. gross margins wallops and jcpenney announcing store closures and 2,000 layoffs. courtney reagan not sure if she

slept. >> i wish you were eck joing about that sleep thing. it's pretty true. best buy reporting a bummer of a holiday. down 0.9%. margins hit harder as the consumer electronics giant offered deep discounts to compete with rivals like walmart. spoke on the phone, called the holiday extreme saying all the discounts didn't create demand for consumer electronics at best buy or elsewhere. also categorizing holiday sales slump as a speed bump and we have operational levers and have the opportunity to use in the future we haven't used this holiday. one is personalized e-mail marketing towards 50 million loyal members. surprised they hadn't done it already, frankly, so was he. this reinforces determination to cut costs go deeper faster and continued to say this is not a 6 month turn around a multiyear turnaround similar to home depot years ago. using them, calling them out as an example.

he doesn't want to minimize the negative or high the positives. online sales through 23% and all u.s. stores capable of offering a shipping program. separately, jcpenney closing 33 underare corporaling stores. it has a total of 104. laying off 2,000 employees as it fights to return to profitability. goldman and ubs lowering price targets. shares trading lower today after that announcement yesterday. brian and mandy? >> courtney, stick around. bring in now, jan rodgers, and former department store, and cnbc contributor. herb greenburgh with us as well. jan, you've been a, not a defender of jcpenney but we've talked about this extensively on this show, keeping our little bet. 33 out of 1,100 stores. people laid off. if you liked jcpenney before, do you like to now because they're willing to take drastic action.

>> at least at much. i think maybe you like it a little more. people are lowering their numbers on them. i'm a little surprised they took this as any kind of a negative. sort of the same we just saw macy's do. right? laying off 2,500 people. closing seven stores. making a portfolio more efficient. that's all that penney's is doing. i think the negative here is, what people don't like about it, is a lot of people think this takes a major restructuring of the real estate off the table. i don't believe that. i think this is the normal course of business that a major restructuring of the portfolio would be another step, but i don't think these two have anything to do with one another, and i don't think they're mutually exclusive. this as you look at all your stores from top to bottom. look at the bottom 10% and say, gee, which one of those can we actually close and make ourselves healthier? and that's all they're doing. i don't think about this one way or the other. a good good idea -- >> 33 stores of some

1,000-something stores? is that enough? >> clearly not enough. it's something they had to do. i'm sure there are more stores they'd like to close. closing stores is not that easy. the lease has to be in the right place. you have to have a strategy for what you're going to do, how you recapture some of the sales. they probably picked up a the ones that were at the bottom of the group they could actually effectively close, and this is probably, will be followed by some again next year or major restructuring. maybe a major restructuring at some point in time of the port follow. this is normal course of business in retailing. we have to be more efficient, ready for increased costs. we may see an increase in the minimum wage. we're going to see cost increases because of obamacare. peer are doing what they have to do to make their business better. i don't see anything unusual about this at all. >> herb, here's what i don't understand. the retail sales data that came out last week was pretty doggone strong, actually. right? even ex autos, looked pretty

good. now all of these retailers have come out and said, oh, we're either, a, not selling much or, b selling a ton but not making much on what we're selling. where the heck are people buying stuff? >> buying it -- certainly buying it online. certainly as it relates to say, a best buy. not going into the stores. or if going into the stores they want great prices. models of some of the companies, i don't know if you can say they're broken but so disrupted that it's, you know, it's hard to determine whether they can come back. i look -- i have to say something. look at this best buy story and the company did want it had to do. they went out and they had to cut -- had to price match. now -- and it still didn't work. >> so they're consult between a rock and hard place. dam d damned if they do or don't. >> best buy gained market share and still disappointing on the top line and cratered on the gross margin line. herb's right.

this is a very, very tough reveal entirmt. and it's tough whatever part you're in. >> can best buy and amazon, clearly competing with on price, can they co-exist? what do you think, courtney? >> i think they can but the footprint will change in respect will always be a freed for brick and port mortar stores in electronics. not everyone is comfortable buying an electronic item online they can't feel, touch and have explained in person. there's always going to be a need for a brick and mortar footprint of some type. they'll need the size of the stores, amount of stores? no. we need to reset expectations for what brick and mortar retail will look like in the future and we have to reset expectations by category and even by player. >> best buy strategy might have backfired. trying to discount to get people in the store so you pick up something else while there, oh, i need headphones. everyone's buying online, up 23%. pretty good numbers. getting crushed on gross margen and people aren't going in to your store anymore. >> it's a difficult equation to play with here. >> okay. >> and one other thing --

>> last word. >> last word to the person who said i was right. >> neither. >> her. not me. >> we have to wrap it up. jan, herb, you're coming back, herb, jan, courtn any, thank yo. two of the smartest minds on the street say, there are still opportunities out there in retail. even with what's going on today. plus, we never really know what's going to happen, but coming up, we referenced it a bit. what happened to a china-related stock last year that maybe will portend, big word, what could top that nu skin. later on, marissa shakes things up. ouchting her number two. if you feel like telling your boss to take this job and shove it, pretty good news for you. there's an app noor. we'll explain when "street signs" returns. [ male announcer ] this is the story of the dusty basement at 1406 35th street the old dining table at 25th and hoffman. ...and the little room above the strip mall

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welcome back to "street signs." lots of big stories in the markets. look at the indices. pulling dock on the zp and dow closing as a record high on the s&p 500 and back to back triple digit gains for the dow. today clearly down by 65 points. with this choppy trade, though, guys, we've still not had a week in 2014 that has seen all three averages post weekly gains. straight down to bob pisani at the nyc. noting it's unusual in the kind

of start of the year we've had. there's a lack of correlation between sectors? >> right. this is great news if you're a stock picker, because there's winners and losers. doesn't that happen all the time? yeah, but in the last couple years everything tended to move up together. not a lot of outperformance. what i'm talking about, and this is unusual divergence. so far this year, a few winners. health care, tech and financials. particularly health care, and notable losers. consumer discretionaries, retail mostly. telecom and energy. look at the wide divergences. down 3%. up 2.7. hasn't happened in a long time. almost a 6 percentage point divergence in two weeks. noticeable. even big momentum names, noticeable divergences. last year, the big names we talk about all the tile. the yelps and zillows, facebook, twitt twitters, facebook, moving directionally together. look at this year. so far yelp and zillow up double digits.

groupon and netflix down 5% and 10%. talking about a 25 percentage point differences in these stocks in just a couple of weeks. the traders are trying to differentiate between them. i guess the phrase stock pickers market, i hate that word. it's a cliche, but that's really starting to emerge, and what we're seeing, you have to pay a lot more attention to sector-specific movements than just, for example, buying the s&p 500. stock pickers love this kind of market, mandy. >> no more throwing darts at a board and hitting the target. thank you, bob pisani. interesting stuff? >> at the health care conference, 94% outperformed s&p 500. it's early this year. merck, best performer on the dow year to date. call it a wrap. with all due respect to gap tech, retail the rambling wreck today. so many names slammed. we know one man's retail trash may be another's retail treasure. from boston advisors, mike binger, minneapolis native

sitting there. best buy our top story today. are you buying shares of your neighbor best buy right now? >> no. in minneapolis i think i would wait on best buy. i think there's -- we need a lot more news flow to confirm that it may be reaching some type bottom. instead buy target. downtown minneapolis, if i were buying one of the retail stocks located here. >> why is that? we know it wasn't a holly hubert joely christmas, pardon that. the stock is soaring off its lows of two years ago. what's your problem with best buy? >> i think best buy, they discounted. so they could get comp sales positive. well, the problem is, they discounted, comp sales were negative, driving a gross profit lower, and we need to wait and see further confirmation maybe the same-store sales can go positive before i'd be a buyer. >> i would like to bring up again jcpenney pap stock you can

duke it out on. mike you say this is a stock you could bottom fish for. it's going to double in two to three years. mike you say it is a bad execution stock. tell us more. >> well, i think the stock is broken. right? they had a total new change of management. they tried an entirely new format. ale alienated all formal customers and trying to fix the damage done. may be sfraul they resurrect the process in the store and bring old customers back. right now they have a lot to show us before we're interested in buying that name. >> yet you reckon it's going to double? mike binger? >> you know, when i look at jcpenney. yeah. bottom fishing is tough and it takes patience. we talked about this stock a couple months ago. it was $7. it's just a little below that right now. but i think like your previous guest said. jcpenney is following the classic playbook turnaround stock.

what you need to dop in the process. they made comps positive, changed management, brought back coupons and promotions, customers love. they have $2 billion in liquidity. we'll see was the cash flow looks like. my guess is that's going to take a little longer to turn positive, but all in all, they're following the playbook and i think this is not a one quarter, two month turnaround. i think it's more of a one to two-year-type turnaround. >> you need conviction. mike, it's been tough owning jcpenney and appreciate you comen on here, but what is it you gee not to belittle the point in jcp making you hang on? >> comps weren't went positive. that's very good. the ceo came out and said, look, our fourth quarter is living up to its expectations. a lot of retailers are not living up to expectations they laid out there. the marketen getting whipped up because they don't know what the profit levels are. my guess is they're nowhere near profitability yet.

that's probably a couple quarters down the road. if i look out two years i think the risk/reward is more in favor of the stock being around 17 than somewhere between $2 and $5. >> that wonderful old quote, every dog has its day. certainly abercrombie and fitch is having a good 214. bought at the end of last year. binger wouldn't touch it with a pole, why you like abercrombie & fit fitch? >> you know, look, we have value instincts as well, and last year a & f had a difficult year. a nice valuation, turnaround play, pressure on management. the initial founder to fix this company. they're working on all of those things that are supposed to fix it. you know, the last week or so they came out with an announcement that said, hey, you know what? our earnings expectations for 2014 are higher than everybody's expecting and we're actually surprised on the upside. so it's had a nice 10% or 12% pop.

look, it's a tough retail name. it's clearly -- an idea of bottom fishing. i like to compare jcpenney and ambercrombie. further along and not so badly broken. we generally like the idea. right now the execution is, more on ambercrombie's camp. >> mike and mike, thank you for joining ug. >> thank you. two key pieces of housing date tat. foreclosures, a six-year low. and home builder's confidence dipping after a big jump in december. diana olick is here to put it all together. two debt pris pieces of news about the housing market. what does it show? >> good news/bad news. home builders sentiment came down one point. the big jump in december revised down ever so slightly, but we could expect that. the builders are coming into january. high construction costs. they also have higher mortgage rates they're looking at and pointed to appraisals not coming in where they wanted to see them.

the other issue -- >> just too low? >> too low. >> even though we see home prices coming up, home builders want them higher. rye not? down 26% in 2013 from 2012. a good year in the foreclosure nushs coming down. the usual suspects still have the highest rates. florida, nevada, illinois. but the good news is they are 3% or lower on those foreclosure rates. >> it's one man, one town? i spoke with an appraiser in my town. 60 open folders two months ago. he has four today. five days ago i spoke with him. >> slow time of year. >> it is off a cliff bad. >> they did see lower home buyer traffic in their showrooms. they're concerneded. we're coming into the spring season. expect that traffic to come up and should see more activity. >> frustrating for builders. and working on a new trend for mega high-end home builders? >> yes. this is so much more fun. this goes well beyond staging. a new way to sell ultra high-end homes. developers are building them

fully loaded from the art on the wall to the $200 toothbrushes in the bathroom. the fully loaded home, just add buyer. >> reporter: this brand new $36 million beverly hills home has everything you could possibly need. correction. everything you need, if you're really filthy rich. >> we have toothbrushes here. putters here for putting green. all the linens. all the towels. you're getting that convenience level. you're walking in to neiman marcus. walking in to sachs and saying, i want that and i know what i want and i'm done. >> reporter: it is the very late nest high-end home sells. well beyond staging the home, but stocking it with high-end products that match the quality of the home itself. the booze is ready to pour in the bar. the wine cellar, fully stocked. if you prefer privacy, it's in the master. and also by the tub. >> my mandate was perfection by

the other than, and i think we achieved it or as cleese ose as could do it. >> reporter: picture frames waiting for your photos. designer cull lettery in the kitchen and books on the coffee table. precisely what many of today's toniest buyers want. >> it's the new billionaire. you know, that young billionaire that just, doesn't have time go through all of those things. would rather concentrate on business, on what they're doing. >> reporter: but make no mistake, it's really catering to the international buyer, whose cash can demand truly limitless luxury. >> certainly an international buyer, whether chinese, russian, london, anybody from there that just wants immediate sanction that doesn't want to go through the trouble of hiring a sdirn, figuring out what to do, what colors. >> reporter: it is all figured out and figured in to the sale price. turn key with an emphasis on extravagance. oh, the new bill nair. granted we're showing you the liest of the high-end. these developers say the trend will trickle down to the lower ranges and when i say lower

rakes, talking about the $2 million to $10 million range. >> right. okay. a demand for that thing even at the lower end. once you bought your house, hassle to decorate it, fill it with furniture. bang, you're done. >> unless you're picky. i wouldn't want that house. right? >> no. still ahead, breaking out our finest crystal ball to see what the world's richest people will be up to in 25 years' time from now. later on, the streaming music war is getting another player and one big name going on the offensive. how many of these can the market sustain? talk about it, coming up.

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2014 is a very special year here at cnbc, because it is our 25ble anniversary. so to mark the occasion, we're looking into our crystal ball to see what the next 25 years will bring. looking at the ultra wealthy what they might look like in 2039. what have you found? >> the global 1% of 2039, from many more nations than now and essentially nationless. we get an idea from marketing

cloet heir calling them the global tribe. discoveries, a marketing firm that does extensive research about future trends saying the rich of the future will be the influencer of the future. >> what is a globe tribe people that communicate all the time, share, and benchmark the world all the time are becoming a reference point that the rest of the nation can afford some of what these guys can do. where do you send your children for the best education? switzerland. where is the best place to retire? norway or sweden or denmark. >> best play to invest money? maybe singapore. they know all that. what kind of loyalty do they have? loyalty to the best. and they know where the best is. and when you know the best, you want it. >> where will the global tribe come from?

the firm predicting the cities with the network, london, new york, singapore, hong kong. three in asia. none in the mainland or latin america. >> not surprising. michelle, stick around and robert frank who would understand clearly what was just said. when you know the best, you want it. >> yeah. i think he said an important point for the wealthy. we're seeing their numbers grow. their wealth grow. more importantly, actualturalcu becoming a nation unto themselves. more in common with fellow rich people around the world than then do with their own country. they've created, really, a country i call richistan. >> excellent book. underrated. >> call is the rootless rich, wandering wealthy. they are a tribe unto themselves. >> how many will there be in 2039? >> this is where my job security comes in. around 30 maria larosa nairs in

the world now. there will be i think around 120 maria larosa nairs in the millionaires. >> those making 500,000 a year now in ten years will probably make -- >> what is the new million? >> okay. let's go -- very good point. why with give you the next number. billionaire. some around 200 billionaires. we predict around 4,000 in 25 years. it gets interesting. look at their wealth. we'll see wealth more concentrated at the very top. they hold around $6 trillion in assets today. i predict it will be $20 trillion in 25 years. >> consider us gdp in that year expected around 30 million. >> and people working. >> really rich, though. they'll control all the robots and drones. >> exactly.

>> thank you so much. both of you. >> you're not the frank in nike frank -- >> no relation. >> robert frank author of "richistan." >> did i mention, fantastic book. up next, "street talk" time. >> plus the sweetest story of the day, when "street signs" comes back. >> announcer: the cnbc realtime exchange market snapshot is sponsored by interactive brokers. >> announcer: interactive broke. . the professional's gateway to the world's markets. if you have a business idea, we have a personalized legal solution that's right for you. with easy step-by-step guidance, we're here to help you turn your dream into a reality. start your business today with legalzoom. we're here to help you turn your dream into a reality.

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so many hot stocks to choose. we'll burn through some you should know about. net suite. >> up 1.5 positive 117. price target 125 about 13% more than net suite trading now. stock already hot. up 64% over the past 12 months.

>> and an upgrade as well. >> railcar maker. don't make catholic churches. changed their price target to 67 and think management "will be rosy" on this year's outlook for 2014. the stock a meerg 1% dividend but stills like it. >> shares up there. >> wow. aol taking off up a 11.3%. about $5.25. good day for aol. basicing write of awe the news site patch, contributing with a venture hail global. and separately out today raising target to 57 from 50. stock at 50 and change, seeing four and change worth of upside on aol. >> speculation about somebody sleeping around aol as well. and calling the sweetest story of the day. >> yeah. 3d systems up 3%. a tough run the last few days.

announcing a collaboration with hersheys. yes, hersheys. using 3d printing technology to create edible food. >> edible foods. our friend josh brown tweeted this out earlier. 3d and hershey teaming up basically inventing wonka-vision. we'd like to get them on the set to do a demonstration for us. imagine that? 3d chocolate. >> i've seen 3d printing a few times. i don't e no how it would work for chocolate. hersh hershey, if you're out there, we'd like to find out. open door policy. >> you make it. we teat. and a huge story of the day. take a look. >> the company getting investigated by chinese authorities. right? you're not allowed to do direct multilevel marketing in china. nu skin getting slammed. halted a number of times this after. china will investigate what they call an illegal pyramid scheme. their rules are different than ours. can't accord downgrading a stock. here's the story, could nu skin, not saying it is, but could nu

skin be a buying sdwrunt focus in on a similar story last year, albeit with a different company, rerched earlier in the show. mead johnson. mjm, product childhood maker. and markups are ours. i got this from a note by d.a. davidson's ramie. a buy on nu skin. mead johnson back in july of last year, the blue rectangle slammed on the china issues. not the same issues. it's not a direct seller. still slammed on the china issues. then a few weeks later, they settled the china issues for about $33.4 million. really a small sum nap is the settlement here. the blue circle. you can see stock is up nicely by then. we bring this up, mandy, ramie notes in a note on nu skin, skill likes the name and doesn't know how it will play out, but what if they just settle? we saw mead johnson get absolutely walloped on china

news. they settle. >> $33 million fine. paid. >> we don't know. nu skin could get booted out of china. who knows. who could settle for a few million or more dollars and go on. making that point. interesting on mead johnson. also got whacked. interesting thing. not a similar exact situation but history with a small guide. >> see the outcome of the investigation by the chinese authorities for nu skin. very interesting. >> you know china more than i do. china doesn't boot a lot of major companies out. >> they want companies to invest there. >> they rattle the cage. sometimes want money. whatever. when's the last time wep had a major corporation be kicked out of chine ma? >> hmm. >> especially one with licenses to do business in china? >> sure, okay. intel set to report quarterly results after the bell today. our very own josh lipton. three things to look for when they report. number one is -- >> that's right, mandy. listen, three big numbers. right? one is going to be sales at the pc client group.

analysts at jpmorgan, upgrade the intel to overweight. they think the pc market will be relatively stable this year. second, watching how the data center group performed. that includes sales of chips used in server systems which can be a volatile business, but the real question, what is intel doing to get into smartphones and tax? intel missed mobile. now trying to buy its way into that market. fbr's chris roland, intel gives tabletmakers, $26 per tablet. three things to watch ahead of intel's earnings. >> win, two, three, you delivered, josh lipton. on tap, extreme drought in california could have a big impact on your grocery bill. a live record ahead. and happy company, wall street. finding out bonuses today. we hope you're truly happy. if not, we've got the perfect app for you. if want to tell your boss to take this job and -- put it?

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of the dusty basement at 1406 35th street the old dining table at 25th and hoffman. ...and the little room above the strip mall off roble avenue. ♪ this magic moment it is the story of where every great idea begins. and of those who believed they had the power to do more. dell is honored to be part of some of the world's great stories. that began much the same way ours did. in a little dorm room -- 2713. ♪ this magic moment ♪

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los angeles. hundreds of acres on fire in the foothills northeast of downtown los angeles. mandatory evacuations under way. they brought in the super scoopers as they're known. in the past few minutes police arrested three recklessly starting the fire. remember, there has been an historic drought in southern california. here's where we bring in our own jane wells. it's 85 degrees there. jane, it's a lot warmer there than most places. talk to us about that and also the drought you've had and how it's impacted the crops? >> reporter: you know, brian it is so dry here. not just warm, but dry. california and drought have gone together like peanut but around chocolate but we're coming off a record year. the governor hasn't technically, officially declared a drought but said basically that's coming. permanent crops at the ex-tense of season's crops in the ag company. that could mean for you you could start to see salad prices

and spaghetti sauce get more expensive. >> the land that you see that normally would be serviced by this well and the surface allocations a laying foul. >> reporter: mark borba is et willing a third of his land go to dust this year as he can't afford to drill for a deeper well and told he can expect zero allocation of water from the delta this year. this is where most u.s. lettuce and processed toe 345matoes are grown. he stopped spending money. >> this year we had four john deere tractors ordered, and they were in excess of $800,000. when the bureau announced a zero water allocation i went to the deal sorry. i'm not going to be able to take them. >> reporter: there is no rain in the forecast. now, what is the cause of all this? there is apparently a massive stubborn high pressure system off the coast, guys, which is four miles high and 2,000 miles long. more than half the size of the united states.

and that is keeping these hot, dry conditions here. back to you. >> it's heartbreaking for farmers. a tough job out there on the land. thank you very much, jane wells. all right. still ahead, yahoo!'s ceo getting a lot of buzz after giving a boot to the second in command. how she did it may be getting as much attention as the act itself. joined by the person who droek the story last week. >> and forget getting fired. if want to quit your job, there's an app for it. the details, when "street signs" returns. get your pencils ready. [ male announcer ] the new new york is open. open to innovation. open to ambition. open to bold ideas. that's why new york has a new plan --

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welcome back to "street signs." i'm scott way breaking develop in the historic detroit bankruptcy case. the federal judge overseeing the case rejected a proposed $165 million agreement with the city, and bank of america and ubs that would get the city out of costly interest rate swaps. the judge says that the city

could sue those banks and try and get rid of though agreements altogether rather than paying that money. this puts in jeopardy the city's plan to finance its operations through the bankruptcy reorganization process. puts a whole lot of plan to finance. this puts the banks in jeopardy and takes away certainty that the city was hoping for in this historic reorganization. we're continuing to follow this development out of the bankruptcy court in detroit. more as we get it. guys, back to you. >> all right, scott. big developments there. thank you very much. well, if you are thinking of quitting your job, guess what? there's an app for that. it's called, appropriately, quit your job. and it's available for the iphone. the app asks multiple choice questions about why you want to resign. then it generates a fitting "i quit" text message, which then you can send to your boss if you want. creators say it's all supposed to be taken with a grain of salt and be funny. it's the same guys who created an app called how to break up with your girlfriend. by the way, don't quit by text.

that's weak sauce. >> used to be by fax. now it's by text. okay. spotify making a big announcement. the music streaming service is getting rid of its listening caps for people who don't already pay for the service. we know it's an incredibly competitive space. how much does this move, help give spotify more of an edge? >> well, i have to clarify. it's only getting rid of the listening cap on the web. as we know, people love to listen to music on their mobile devices. but there's to question here that what spotify is trying to do is make its service more appealing ahead of the launch of beats music. it's a new music service which is set to launch on january 21st from the same people who brought you beats headphones. so both pandora and spotify are trying to make their services more compelling. >> do we expect to see other competitors follow in their footsteps? >> well, it's interesting. the other big news we had this week from this competitive landscape was pandora launching new, more personalized streams. now, what's interesting about

the launch of beats music is that it's all about kcuration. they're using real-life people to help create streams and play lists. pandora has already been competing with apple's itunes radio service and spotify and all these services. now, pandora is trying to say, we have new tools to help more better customize what you're listening to. >> julia, stick around. we're going to move on to another story. and that is yahoo!. firing their ceo last night. the statement read, quote, i made the difficult decision that our coo leave the company. he'll walk away with more than $15 million. let's bring in kara swisher, who called this move last week.

we also have our own john ford as well. i know you're not surprise esur. you wrote last week he was in trouble. you did add this was a big correction for mayer. what do you mean by that? >> he's been having trouble for a long time. he's had very bad reception in the advertising community. he had a lot of trouble at yahoo!. and by the way, he had a lot of trouble at google, which goes back to the actual hiring, which was problematic, to say the least. >> you're basically saying proper background checks were not made. >> no. i would say that. i have a story i'm working on that i've been working on for a while. i interviewed dozens of people at google. it wasn't hard to -- if she had made two calls at google, she would have understood the problem with him. >> does it also show that she's not perfect, right? this was a very expensive hire and fire. >> well, by the way, it's a lot higher than $20 million he's walking away with. >> how much is he walking away with? >> much more. he made $39 million in one year. so it's a lot more money than

that. and he got $20 million for coming from google. then another $18 million for retention bonus when he was fired. a lot of money. >> i want to reiterate that point you made here, kara. you believe, based on your extensive reporting, sources inside google and i'm assuming yahoo! that they did not properly background check him. this is a guy that $20 million, $30 million, $40 million, that's a big number. how do you not vet someone like that? >> a lot of people in the advertising community were also surprised by this hire. he had a very rockied tenure at google. she never worked with him at google, even though they kind of put that idea out. they never worked together. marissa was not involved in advertising and had never worked closely with him. it was sort of a glamour hire because anyone from google has to have this sheen. all of them don't. very difficult job, by the way. the switch between what he was doing at google and what he nooded toot at yahoo! very

different job. >> john ford, i know you have been following marissa mayer for a long time. you know about the personality she has and how she operates. what more have we learned from this that she did not let this guy walk away gracefully? >> well, there have been a number of people who have gone from yahoo! one in particular who headed up a start-up that yahoo! bought that haven't exactly gone away gracefully. she hasn't been necessarily making it smooth for people going out the door, but, you know, this was a very important hire, a very high-profile hire she made. by the way, if you'd called a number of people within google, they might not have said glowing things about marissa either. that might have influenced her take when he was coming in the door because of the situation she was in when she left google. but i think it's really important to look at the team that she's put together to run the core business this year. she needs to get this right at this point. she's done a lot of interesting

things to set up a good year for herself in terms of getting activists off the board, in terms of getting all this cash. now people are going to want to she that core business grow. the team she has now has got to be the ones to make that happen. >> absolutely. we need to see that revenue growth. julia, quick thoughts from you. >> i think it's really interesting in getting rid of him, she's reorganized to have more people report directly to her, which puts more pressure on her. i think it's also interesting the way she handled this. we've seen ceos like reid hastings make major strategic mistakes. netflix launched a new service that doubled its price. he had to say, i'm sorry, i made a mistake. here, many would say she simply made a mistake. a very expensive mistake. she did not apologize or really acknowledge the mistake. she just said she was getting rid of him. >> thank you, all, very much. kara, just to reiterate, didn't yahoo! have this problem with a different executive before, the lack of vetting? >> you know, it's always a problem, but your question about whether she's perfect, i don't know why you think anybody is

perfect, but in terms of what she said that kind of thing, everyone is giving her a lot, it's so honest, this was such a blatantly obvious disaster. there was no way to say anything but i fired him. >> okay. >> thank you very much. we'll look forward to that article coming out. thank you so much. by the way, nbc, a minority partner, we also have a content sharing partner with yahoo!. there's the disclose sure. back to the breaking news desk. the hits keep coming. >> this time it's about a privately held company, neiman marcus group. they were also the target of credit card breaches. the ceo is making comments reported out by dow jones. she apologizes for customer credit card data breach. they say malware has been disabled. it sees no connection to the target breach and will offer free credit monitoring services to shoppers. again, the ceo of neiman marcus

apologizes for the breach and says it will offer free credit monitoring services to shoppers and sees no connection with the data breach over at target. back over to you. >> seems like a good way to end the show. it's been an action-packed hour. i know "closing bell" will have much more on everything we talked about. >> indeed. they're coming up right now. thanks for watching. it's just that i'm worried about, you know, "hidden things." ok, why's that? well uhhh... surprise!!! um... well, it's true. at ally there are no hidden fees. not one. that's nice. no hidden fees, no worries. ally bank. your money needs an ally. ♪ stacy's mom has got it goin' on ♪ ♪ stacy's mom has got it goin' on ♪ ♪ stacy's mom has got it goin' on ♪

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