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tv   Power Lunch  CNBC  February 18, 2014 1:00pm-2:01pm EST

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>> pete? >> sienna. buy it. >> xlu. >> josh brown, what do you like on your final trade? >> advanced auto parts. aap. i think it goes higher. >> that does it for us. have a great day. we will see you tomorrow. "power lunch" begins right now. "halftime" is over. "power lunch" and the second half of the trading day start right now. >> scott, thank you very much. the housing market just got a little less sweet today, folks. home builder sentiment plunging this month. the sector bearing the brunt of the report this afternoon. there you see those big home builders all down by various scales. all right. want to own a car or buy one? come on down. today, we give you the first look at how this terrible winter weather is hitting the car market and not in a good way. will this mean that there will be some deals for you? and mother nature once again dumping more snow on the east coast.
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northeastern commuters caught in the crosshairs once again. we are watching the weather and will have wall street's weather man to explain how you might make some money off this rough, rough winter. sue is off today. s sara eisen is at the new york stock exchange. a big number to the down side of the housing sector. diana olick, big drop for home builder sentiment. the sector is down but what does it mean for home prices? >> reporter: well, look, we know that the builders have had to raise their home prices because they are facing rising costs for land and for materials. they are also facing a labor shortage because so many contractors got out of the business during the housing crash. all of that having an impact. but take a look at the numbers from today's report. a historic drop in builder sentiment, bringing the sentiment survey numbers into the negative for the first time
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since last may. that's the largest drop, that ten point drop, in the history of this survey going back to 1985. but look at the components of the survey. current sales conditions were down the most, down 11 points. then buyer traffic, down nine points. the one down the least, future sales expectations. but look, that's based on the visions of the spring housing markets and pent-up demand. but regionally, and the builders like to use a three month running average but if you look at it month to month, the weakest, the biggest drop, was in the west which wasn't affected by weather at all. what we see out west is very fast rising home prices and very weak affordability. so back to your question on home prices. look, prices always lag sales. we're not looking at a particularly good season for home sales right now. that means that the builders are going to have to drop those prices if they want to get buyers in the door this spring and hopefully this thaw will
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help them out as well. there's lots more online. tyler? >> maybe there's a thaw where you are. right here it's snowing hard and cold. thanks very much. this is the biggest drop for home builder sentiment since that survey began. anything below a 50 is considered a negative sentiment and right now, we stand at or sit at 46. here's another check on the home builder stocks as we mentioned, they are down across the board. we have a professor of real estate and finance at wharton. we are sort of extrapolating from this home builder sentiment number and thinking rather negatively about it. is this one of the housing numbers that is more prone to volatility? >> it is prone to volatility. but behind the sentiment are factors that are fundamental. so it's not simply perception out there. it's reality. this housing market is not going to power the recovery as it has. >> what are the fundamental problems in the market right
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now? >> fundamentally, what we can see the slowing of the sales and it's reflecting affordability problems, interest rates are higher. we had an incredible rise in housing prices last year, 12%, and it's not so easy to get a loan. you have to have pristine credit. so the combination of the rise in rates and the rise in prices is making housing less affordable. first time home buyers are not out there as they have been in other recoveries. >> have lenders really maintained their very strict standards, or have they loosened up just a bit? and answer -- >> they have. >> go ahead. finish. go ahead. >> yeah. they have. they have. they have loosened up a bit but at the same time, as loosening up a bit, there are new regulations that have come on board as of january 10th and of course, there's just the fundamentals. housing prices and 100 basis point interest rate rise, pulled back about 25 basis points but still, the cost of first time entry is higher than last year
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and is slowing down demand. >> put on your academic hat and answer the question whether this slowdown is actually a good thing because it does reflect fundamentals. in other words, that in a prior marketplace, maybe people who really couldn't have afforded the home would get the home anyway because the lenders were willing to make loans that might be deemed today irresponsible. is this slowdown really healthy? >> well, i'm not going to totally agree with that. certainly we don't want to have unsustainable credit standards. in that respect, and we are in the taper world, and that's going to drive interest rates probably somewhat higher and they have in fact caused interest rates to go up. so those things are a cost of the macro picture. but where there is an issue is the fundamental demand coming from household growth which is very slow right now, a real question, income growth, job growth.
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this is going to still be a slow recovery, meaning that housing is going to be a slow recovery, and housing will not contribute to a faster recovery. that means overall growth is shrikely to be slower than last year. >> professor, thank you for taking it apart for us. we appreciate it. >> pleasure. >> let's go to dominic chu for a market flash. >> check out what's happened with world wrestling federation worldwide wrestling, moving lower here. the company has been unable to reach a deal with nbc universal, the parent company of course of cnbc. variety is reporting the company has stepped away from the negotiating table without a deal for the programming there so those wwe shares taking a hit in today's trading. >> thanks, dominic chu with a market flash. tyler just talking about housing being impacted. not the only sector where there is worry. phil lebeau is talking february auto sales. he's live in chicago. just coming off a long holiday weekend. any hope that february can be better than january?
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>> there is still hope the rest of this month could improve but the early indication is that the start of this month has not been a good one, especially for the eastern half of the united states. the early indication, and these are just cursory numbers at this point, but when you talk to people in the industry, they say that yes, february auto sales have been hurt by the storms. in fact, j.d. power says sales were down about 5% nationwide in the first week of february. however, j.d. power and others believe that february sales should rebound in the second half of this month. the dealers are reporting strong demand in those markets where there have been storms when the weather clears. in other words, people are staying out of the showroom when the storms hit but then are coming back in. take a look at the auto dealer stocks. a lot of people are saying boy, you had a big year for the auto makers last year, should the auto dealers have seen the same performance. no. they didn't see the same performance. in fact, it's really been tough sledding for them, not to play on words, over the last six months. bottom line is this. the expectation is for sales to improve the second half of this
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month provided the weather cooperates. >> phil, thank you very much. i will pick it up from there. we will go to a senior economics reporter, steve liesman, who has been looking at the impact that other bad weather years have had on economic data. what can you tell us? >> we need to start where we always do, with a look at the shoes. >> let's look at the shoes. >> salt-encrusted clodhoppers. >> these are winter tires. >> i wore a normal pair of shoes here. we were talking about two things the last several weeks, two phenomenon. cold and also snow. i want to take a look at the cold real quick. we showed you this graphic. this was the january data. much colder than normal, where all the people live which is what matters for the economic impact. we just got some february maps in. i want to show you the first week of february, thanks to our people at the weather channel, our friends over there. you can see again, still much colder than normal and the west comes in there so again, that's one impact. ubs tallying it up in a great
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study over the weekend. you can see temperatures compared to normal, 2.4 in november, 3 in december, 3 degrees that is, 1.7 in january. what they did now is they looked at nine storms over the past say 20 years or so at the impact, the deviation from the five month average when it came to, for example, jobs were down 74,000. inside of that, construction down 30,000. nonconstruction down 42,000. but no effect on the unemployment rate. no deviation from the five month average. where was the big hit? retail takes a big hit when you have these kinds of storms. 0.9% down, take out autos and you have 0.5. you just heard phil lebeau talk about the auto component of that. housing starts are down but as you can see from diana's report, still in effect some place else, not just weather. new home sales also down. little effect seen on manufacturing indicators, though a 0.3% impact on output of manufacturing. one other thing to show you, there's one nasty storm, 1993,
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march, when tyler was in his middle ages right there. payroll down 265 from one storm, retail down 1.5%, housing starts down 124,000. so those are the sectoral numbers. housing and retail, big places where you see it, where it comes up and there is an impact on jobs. the best thinking i'm reading right now is that some of the weakest we have is weather related. other factors may also be at play. >> thank you very much. appreciate it. down to you, sara. >> another place that's showing up, the weather, nat gas, up 27% in a month. that is a big move. today it's up again almost 5%. meteorologist dan leonard is with wsi, we call him wall street's weather man because he forecasts for traders. tell us, what are you telling the traders now in terms of the current storm we're in, if it will get worse and how broad it will be across the states. >> reporter: i got to tell you, normally this time of year, we are almost backing off on sort
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of the winter, we are starting to head into the spring season and traders lose interest typically in your average year. but i haven't talked to a trader recently that's been more excited about what's coming up for this march. everybody's talking about march, will we start to turn the corner and get warmer or is there more cold coming. right now, we do expect a lot more cold coming for the month of march, just unbelievable. a really big finish to a really big winter. so that's part of the reason why prices of natural gas have been driving up continuously since pretty much the start of winter. >> so we're set to see more cold. what does the supply picture look like? you say traders are getting excited. those of us dealing with higher heating bills, not so excited. what does it look like with the rising heating demand and lower stockpiles for u.s. for natural gas? >> right. obviously we have had the big cold over the areas that count, the midwest and east, especially, all winter long. if you look at stocks right now, we are way below the five year
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average, pulling out way more gas than we ever have over the past five years. i think we are about 800 lower than we were this time last year. probably not looking at any sort of chance we will run out of gas but we are looking at potentially shortage concerns heading into the summer. that's why march is so important coming up for these traders. march is when you typically stop drawing from the supply and start putting gas back into the ground. if we delay that, if we keep drawing more and more gas into march if it's really cold, there's going to be definitely some supply concerns as we head into the early summer. >> dan leonard, thanks so much for the weather forecast as it relates to natural gas. tyler, prices heading higher. >> oh, yes indeed. my bills have been very, very let's call them unseasonably high. dominic chu, market flash. >> check out blackberry shares. disclosed a ten million share stake in the company during the filings. in addition, fbr capital markets upgrades the stock to market perform from underperform rating
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and raised the price target to ten bucks a share from 6.75 largely based on positive price momentum. the stock is currently up about 6%, 7%. doing pretty well in today's trades. sarah? violence plaguing ukraine again today. we are seeing police squaring off with demonstrators at key buildings in ukraine's capital city of kiev. at least nine people, including two police officers, were killed. we have been seeing these violent clashes for weeks now in ukraine. there are two sides here. one that wants to be closer to russia. the other side wants to be aligned more closely with the rest of europe, the european yun. now you are seeing live pictures from kiev, evening. authorities are calling now for a curfew. no new traffic is being allowed into the capital city on this latest wave of violent protests. we are also keeping an eye on venezuela, kicking three american diplomats out of the country saying they are behind a wave of protests.
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the state department denies the charge. last week, three anti-government protesters were killed in battles with the police. a key leader in the protest movement has gone underground but is expected to surface today to lead a new round of protests. he is actually daring the venezuelan government to arrest him. tyler? there is a very interesting story behind the worst performing stock in the s&p 500 today and we will tell you that story next. and what will the uaw do after a big setback in the voting in the south? a porsche problem and snow is not united's problem today. computers are. that's all next. plus a big step for the tobacco guys. making a tv comeback. smoke them if you got them. don't, actually. in a world that's changing faster than ever, we believe outshining the competition tomorrow quires challenging your business inside and out today. at cognizant, we help forward-looking companies run better and run different - to give your customers every reason to keep looking for you.
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check out shares of kansas city southern, the biggest loser in the s&p 500 today. that stock is taking a hit after jpmorgan cut its rating to neutral from overweight on fears that pending legislation in mexico becomes law and spurs increased competition there. the firm cut its price target to $96 per share from $118. sarah? have a look at the new e-cigarette ad that is airing on british television. keep in mind, ads for smoking have been banned on british television for 20 years. >> experience the breakthrough.
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>> all right. this is probably causing quite the stir. >> reporter: it is. it is. you've got these very young glamorous looking people running through this wall of vapor, it's not supposed to be smoke, it's supposed to be vapor but it's the first time in some 20 years we have seen tobacco ads back on british television. a lot of the health campaigners are arguing it's a step in the wrong direction. for ages we have been trying to teach kids especially it's a bad thing to smoke and now suddenly we are glamourizing smoking and the smoking industry. you can look at this ad again. they say this is going to simply encourage people to move in the wrong direction. on top of that, it's an industry, the e-cigarette industry, which came from nowhere, an industry that was worth next to nothing just a decade ago and now suddenly is a $3 billion market. but you had these decades of policies that have been put in place to prevent smoking and now suddenly we could again take a step back. another issue is the regulatory gap where it's obvious when you look at some of the advertising
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regulations out there, according to critics, that the advertising, they were not designed with these products in mind. as one spokesperson for the advertising standards agency said they are going to be reviewing all of these methods in approximately a month's time. another issue is that the way this particular e-cigarette advertises, it's different if you look at the digital media versus television and how they are allowed to show it. last but not least, the problem is that from 2016, the e-cigarettes, they have to be marketed as a medicinal product as opposed to a cigarette or something that could be bad for your health. >> good to see you. thanks for bringing us that. guess we will wait to hear what health officials have to say. >> it will be very controversial, i am sure, when they try and advertise, if they try and advertise on tv here in the united states. phil lebeau is on the countdown today and we got three topics. the uaw's defeat down south, a fiery problem for porsche and a big united glitch. let's start with the uaw.
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what do they do next, phil? >> reporter: they are putting on a brave face right now and uaw says oh, they are looking at their options. i'm not sure how many options they really have. they will try to organize some of the other southern auto plants from the foreign automakers, in particular there has been some talk about trying to organize the alabama plant that is run by mercedes benz. but you know what, the anti-union forces who are vocal in chattanooga have said you name the plant, we will be there and defeat the uaw. this is a huge blow for the uaw. they have got to do something because they have said if we can't organize in the south, it's going to be really tough for this union to be a major force in the years and decades to come. >> this was a case as i understand it where volkswagen, the owner did not oppose, really didn't take a stand. they weren't fighting against it. >> reporter: right. that's the difference between the chattanooga vw plant and other southern auto plants run by foreign auto makers. they have been less than receptive to the uaw in the past. i think that will be the problem
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in the future for the uaw. >> talk about porsche. they are halting sales of a particular model. why and how long before they might get a fix? >> reporter: we are talking about porsches that have been catching on fire. we are talking about the carrera 911 gt-3 models. there have been at least two reports that porsche acknowledges that it is investigating right now, although i have seen other reports online that there may be some others where the vehicles spontaneously come busted and caught on fire. porsche did issue a statement saying we have asked our dealers to stop selling the 911 gt-3 until we can analyze reports of engine problems in a very small number of vehicles. so far we know of only two incidents, one in switzerland, one in italy. any time you talk about fires in vehicles, never a good combination. that's why you have seen the gt-3 sales being halted. >> let's move on to if the weather weren't bad enough, a glitch for united here. what's going on? >> reporter: seems like a broken record. every several months we get a report of united computers not
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operating. in this case, it was a system-wide intermittent issue. they don't know exactly what the issue is, but they say that it's not an outage and it has happened system-wide. we know it obviously because the bulk of the united flights at this time of day are here in north america. we have seen delays in a number of places around the country. it depends on where you are, how long your flight has been delayed. united is still working to, a, fix the problem and then figure out exactly what went wrong, and they are also putting in waivers for those who missed that are flights. we hear about this it seems like every six or seven months, a computer issue for united airlines. i interviewed the ceo in the past and he said we are fixing that problem, yet here we go again. >> when united and continental merged, it was a very difficult integration of their computer systems here. is this glitch affecting -- is it affecting the reservation system or is it affecting how they move planes from one place to another or what? >> reporter: well, it's the
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passenger service system. essentially, when you're checking in to flights as well as the reservation system, that slows everything down. you just can't go through the airport now and scan and say get on the flight, mr. smith. you've got to do things by hand in many cases. >> that's very interesting. everybody now uses the kiosks as i do, where you go through and you punch your ticket out. >> reporter: the whole system is integrated. it's not as though you can cut off one and say okay, this is the problem in this one particular area. >> thanks very much. phil lebeau reporting. sara? a big day for japan. why that giant rally overnight not carrying over into u.s. market. we will talk about the link next. and outside of the "shark tank" and inside the wine bottle. it's an amazing new way to make sure your leftover wine doesn't go bad before its time. ♪
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welcome back to "power lunch." check out shares of jos. a. bank. a letter sent to the board noting its opposition of its recently announced acquisition of eddie bauer, saying it's engaging in desperate tactics in blatant disregard of the best interests of jos. a. bank shareholders. about 2% to the downside today. sara? let's talk japan. stocks there rallied hard today. the nikkei closed up more than
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3%. the biggest gainers, the banks, because its central bank kept its easy money policies in place. the dxj and ewj etfs, a trade here follow japanese market, as you can see are higher today in a flat overall u.s. market. the japanese yen is falling against the dollar, at its lowest level since january 31st. here's what happened. the bank of japan held steady on monetary policy. it extended those special loan programs designed to boost loans and boost growth, but it did stop short of adding additional stimulus, remaining positive on economic growth. despite weak economic numbers that we saw over the weekend, traders do expect more stimulus and japan is showing that it is in action mode and committed to turning this economy around. the move not only helped japanese banks but as you can see, auto makers as well. toyota and honda both higher in today's session. speaking of today's session, bob pisani is back with your
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take on japan, the most important story right now, wouldn't you say? >> kuroda had his moment saying whatever it takes to defend the japanese economy and the currency, they are going to do it. they are going to go out and deal with that and have been doing a good job. take a look at the s&p 500. we are less than half a percentage point away from new highs. the number to watch is 1848, that's the old closing high. despite the disappointing sentiment numbers and boy, was that a disappointment as well as the empire state numbers as well. take a look at the home builders. they are reflecting that disappointing nehb number down throughout the day, most down throughout the year. hotels are down. choice hotels, think econolodge, comfort inn, they gave guidance a little below expectations. that's down 3%. it's weighing on that whole group and nat gas up 30% so far this year. all the utilities are among the better performers today. i always get asked this when i go away, what about the ung, the etf for natural gas.
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i want to point out it does not track natural gas. natural gas is up 31% this year. u.s. natural gas etf, the big one, you can buy that, is only up 26%. the reason is they own futures contracts, not the cash contract, and they have to roll over into the future contracts every month and that costs them. it's expensive. they have a tendency to underperform the overall market. still, there's no perfect way to own nat gas right now other than those kinds of etfs. >> a cold march, we hear, could keep it going even higher. good to see you, bob. we will bring rick santelli into the conversation tracking the action at the cme. when you talk about qe, the question is, what does the end game look like? >> reporter: well, japan will give us a glimpse in a more extreme fashion. consider the mantra, all stimulus is fungible. the japanese just raised the ante at a time where the u.s. is lowering it. but look at where their stock market is. the nikkei at one point in time 25 years ago was close to 40,000.
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our nasdaq at one point in time was 5,000. we are much closer. how much difference has it made? the gdp numbers released on the 16th were weak so we're five basis points down in treasuries but to sara's point, let's look at two correlation charts. the dow versus what's going on with the dollar/yen, the correlations have broken away. but look at the ten year against the dollar/yen. still correlating very tightly. the motto is whether it's swimwear or whether it's weather, not every market buys into every excuse. back to you. >> i love that. rick santelli, always great to get your thoughts. i want to check on precious metals. gold prices are closing as we speak. and they are up. extending the gain from this year, they are up about 10% after a weak year last year. silver and copper prices, higher as well. palladium and platinum, the industrial metals, heading south. there's your look at the metals close. now let's head to the nasdaq which has been pretty much going
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strong here this session, earlier hitting a 13 year high. >> talk about gains here because that's exactly what we are seeing at the nasdaq. the winning streak of course continues. we have hit a fresh high for the fourth session in a row and here's the thing. we have actually crossed that 13 year high to a 13 1/2 year high. that's exactly the kind of momentum traders like to see here, higher highs, also more risk appetite on the part of the investors. as for what's moving the index, take a look at large cap tech. apple, google and microsoft. also a theme we talked about over and over again, biotech continuing to play out. it's been a great day for health care stocks. tyler? the final days are upon us in sochi. just five days left. michelle is there live. michelle? >> reporter: yeah. very busy day on the ice here in sochi. on all the events that have been built at venues so fans can walk from one to the next very, very quickly. i'm going to walk that walk next.
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plus looking ahead to the next big global sporting event, the world cup. where there are big, big problems to tell you about.
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welcome back to "power lunch." check out shares of prana biotech. its experimental drug to treat a degenerative brain disorder met its main goals in a midstage trial. this stock has a market cap of around $400 million. it's a smaller cap company but very big movement of stock on this treatment possibly for huntington disease. back to you. >> thank you very much. a 40% move always worth noting. let's get caught up on the olympic medals count. as you see right there, the netherlands has edged into the lead with 20 medals total. russia and the united states are second with 19. i guess netherlands picked up a couple today. norway has 18 and canada clocks in with 16.
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cnbc's chief international correspondent michelle caruso-cabrera is over in sochi and you put together a look at some of the venues and getting around between them. >> reporter: yes, that's right. when you watch the olympics you see the interior of the venues all the time. but what's it like from a fan's perspective when they arrive, when they walk around this big space you see behind me? take a look. what makes this olympics unique is how concentrated so many venues are in a tight area. this is possible because russia constructed everything from scratch. here's how they planned it. they put the flame in the center. that's also where they do the medal ceremonies and all the ice venues encircle it. you can walk quickly from venue to venue. being cnbc, the first place we wanted to show you is where curling is held. this is called the ice cube. does it look like an ice cube? hold that thought.
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this venue is temporary. it will be dismantled and moved to a different part of russia once the olympics are over. this is where they hold the speed skating events. we kind of think it looks like a convention center. this is the venue everyone confuses with the ice cube because of its square shape and blue color. however, it is actually the iceberg. i think it's the prettiest venue here. this is where women's figure skating takes place this week. one of the largest capacity venues, fisht stadium. only two events are held here. opening ceremonies and closing ceremonies. in fact, they are in there rehearsing right now. >> along the way you can stop for ice cream with chocolate. yummy. >> reporter: ice hockey is so popular in russia. at the winter olympics, there are two venues dedicated to it. this is the smaller one where the matches with lower expected attendance are held. officially it's the shayba arena
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but nobody calls it that. they call it the puck because it looks like a hockey puck. for the really big matches like usa/russia, they are held at the bolshoy. a virtual palace to ice hockey with a big area for the large expected crowds. take a look. this is where the shows are broadcasting from. of course, the big gold medal match will be held here. i know you will be watching. in fact, i'm off to watch a game right now. so the next big global sporting event will be the world cup in brazil. it starts in mid-june. fifa is deciding whether to keep matches in the city, where the stadium still isn't ready. minutes ago, a brazilian government source said that fifa would keep the games there, but there's no actual word from fifa itself. the city is about 250 miles south of sao paulo, not far from
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the atlantic ocean. ironically, russia is scheduled to play a match there. total of four group round matches are supposed to be played there but no elimination rounds. brazil's leader has promised the stadium will be ready but fifa says it's still not convinced. six people have died while brazil constructed its world cup stadiums. there have been problems all along. if it isn't ready, those four matches will have to move to another venue. fifa actually just this minute confirmed that it will keep the matches in curitiba so they will have to get that stadium done. but all the infrastructure they were going to build around it to get people there, that's pretty hopeless. >> amazing stories there. of course, the olympics following two years after that in rio. they will obviously be trying to keep pace with venues they have to build for that. always great to see you. if you didn't know, your home for curling is here on cnbc,
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5:00 eastern time every night this week. this sport rocks. we hope you will tune in at 5:00 tonight. dominic chu is here with a market flash. >> i like curling so i will definitely tune in. let's check out shares of tesla, continuing to power forward. this as investors continue to react to news that the electric car maker's ceo, elon musk, met with apple's acquisition chief. the stock hitting an all time high, up another 36% this year alone. this after meteoric gains in 2013. the company has a market cap of $25 billion. back to you. >> amazing. a new intraday high. thanks very much on tesla. will 2014 be a big year for big business in space? jane wells is live in the mojave desert with the very latest. >> reporter: if you can believe it, it has been ten years since spaceship one won the prize.
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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. welcome back to "power lunch." i am brian sullivan live in sochi, russia. coming up on "street signs" we will give you all the latest from the games here plus a very cool look at some of the old soviet cars that are still on the road. we are also going to try to make a russian smile. see if we can dispel some of the stereotypes. we got simon hobbs and melissa lee piloting the craft. much more on the nasdaq's 13 1/2 year high. great stuff on real estate as well. it will be halfway around the world version of "street signs" coming up in a few minutes. i'll send it back to "power lunch."
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>> good to see you out there in sochi. richard branson thinks virgin galactic his airline into space should be operational this year for paying customers who actually want to go where few men, women, children have gone before. branson however isn't the only entrepreneur with his sights set on space. jane wells is live at the mojave space port. is this an ego thing or is there really big money to be made? >> reporter: it's a really expensive ego thing if they don't think they will make any money off of it. hard to believe but it has been ten years since spaceship one went up and as you mentioned, spaceship two, the one virgin galactic says will be taking paying customers, they are working on it in a hangar right over here. he says that's going to happen this year. meantime in las vegas, you have robert bigelow manufacturing inflatable space habitats. one will go to the international space station next year. the goal is to get these further out into space and to the moon. billions are being spent in private ventures and when will
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rockets, crew carriers and habitations be ready for each other. >> we have always had to arrive at that intersection which i initially thought would be 2015. it's now 2017. where transportation was going to be available. it doesn't do us any good to be there alone. there is a serious need to have one or more other destinations. the international space station cannot produce enough demand by itself to support even two transportation companies. >> reporter: there are a lot of moving parts and a lot of money but so far for branson and bigelow, not much in terms of income. though bigelow says he has mapped it out to make money eventual eventually. there's no point in doing it otherwise. back to you. stick around, because we will bring in jon fortt. you say space travel is taking off. will it really?
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what do you say? >> reporter: me? of course it will take off. the question is when. all these things have been delayed, delayed, delayed. virgin galactic was supposed to be up and running by now. google lunar ex-prize supposed to have a rover on the moon. it hasn't happened. these things are taking longer, taking a lot more money, but they are moving forward and i think it will happen. now nasa got more money this year and that is a good thing for these private ventures. the ones that depend on nasa for seed money and partnerships are the ones furthest along. just ask elon musk. >> let's move on to the question of a loophole in british advertising. this was one that was before the e-cigs were even there. it banned television advertising for smoking products. they are coming back now, apparently on british tv, after some 50 years or so. jon, what do you think? is this a good idea? will it come to the u.s. and remember, these are not technically tobacco products, though they do contain nicotine.
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>> well, i think if we see a robotic joe camel, maybe we need to worry. i guess the concern is somehow they will use the e-cig ads to promote actual cigarettes. since i moved out here to the east coast from california, it's weird, i see people out on the street smoking cigarettes with no shame. at first i had to get over that. i have to say, too, jane, i'm jealous you get to hang out at the spaceport. >> jane, where do you come down on the e-cigs? >> reporter: who cares? just watch "true detective" on hbo. i'm getting lung cancer just watching it. if they want to promote e-cigs which there is no solid evidence yet that it leads to any problems, i don't think that's a problem. >> let's move on to king digital entertainment, the maker of candy crush is filing for an ipo. is online gaming a good investment or just a fad and we asked you in today's yahoo!
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finance poll if you would invest in this company. 7% said yes, it has mastered making addicting games. 21% say i love the game but not interested in the stock. a whopping 72% say no, other gaming company stocks haven't performed. have they, jon fortt? i thought zinga performed for awhile there. >> yeah. farmville was great. what could go wrong. look, every addictive game is really addictive until it's not. even mario is having trouble these days looking at nintendo. they got to have more than just this game. we haven't seen whether they will be able to extend that brand into other things. it's risky but you can take your shot. >> jane, what do you think? >> reporter: i was playing candy crush a little while ago. it's kind of a tetris for kids. it's a much more successful game than anything zinga has ever had but again, it is the one most successful game they have. the question is, these other games they have, can they become something more.
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and certainly the news that they will file for an ipo has been great today. the stock last i checked was up over 4%. >> thank you both very much. jon has been talking video games in the rundown but is also at the toy fair in new york city looking at high tech and low tech toys. there's a big annual event there in the city and he filed this report for us about 15 minutes ago. >> reporter: here at toy fair this year, we see tech's influence on just about everything, even toys as basic as the paper airplane. over here, a new take on the remote controlled vehicle. this one has a solar panel on it. you can get it to power something like this, if you don't have the batteries in it, you can use the solar panel to make this go up and down. pretty cool. and then we've got this. cute, right? inside, it's an ipad mini. even the toys that don't have
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technology built in are influenced by it. the domestic toy industry is about $22 billion a year. flat for the past couple years. some of the toys you are more hands-on with, construction toys, arts and crafts, those are doing better than some of the toys that can be taken over by apps. >> that's jon fortt reporting from the toy fair. it is "shark tank" tuesday on cnbc. today we have the creator of the air cork. just how did he come up with this gadget and did the sharks like it? we will pop a bottle and try it out. peace of mind is important when you're running a successful business. so we provide it services you can rely on. with centurylink as your trusted it partner, you'll experience reliable uptime for the network and services you depend on. multi-layered security solutions keep your information safe, and secure. and responsive dedicated support meets your needs, and eases your mind. centurylink. your link to what's next.
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check out shares of lulu lemon. the athletic apparel company upgraded to outperform from perform at oppenheimer. also getting an upgrade, deutsche bank upgrading big lots. shares of that company are higher as well. >> thank you very much. "shark tank" returns tonight on cnbc at 8:00 p.m. eastern time. great program, as you surely know. check out this product. it is called the air cork. it is a unique wine preserver that inflates inside your
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bottle. the creator was offered a deal on the show but you have to tune in tonight at 8:00 eastern to see what happens. here with us now is eric courty. how did you come up with this idea and why is this better than the conventional stoppers that you put in to preserve wine? >> frankly, i was tired of dumping wine down the kitchen sink is what it came down to. i was using all the rubber stopper vacuum type devices, i was using all kinds of things. ultimately i had to come up with a way to seal the wine from the outside air at any level within the bottle to prevent oxidation. the air cork is designed to go down inside the tight neck of the bottle to provide a complete seal within the bottle and eliminate oxidation. >> i will pump you up here as they used to say. this thing is like a little balloon or bladder that goes in. we have a really fine bottle of chardonnay here, goes for about $8 at full price. i hope i'm doing this right.
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so it creates an air-tight seal. will it come out? no. look at that. that's quite amazing. i hope i don't -- can it pop? can the thing pop inside there if i overinflate it? >> ultimately if you tried to really inflate it and bring it up the narrow neck of the bottle, ultimately, anything is possible, i guess. but they are easily replaceable. >> this is really something. it's a really cute little device. how much does it go for? >> goes for $24.95. we think it's pretty reasonable for a lot of folks. no matter what you can afford, whether the $14 bottle or $214 bottle. >> it is a great gift. i think it would be great to have in your house, a wonderful sort of host or hostess gift if you are bringing wine over to somebody's house. do you sell it at alcoholic beverage stores, where? >> we do. it's really out in houseware stores, alcoholic beverage stores. we are trying to get it out there. >> what was it like being on "shark tank"? were you nervous?
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how was the reception? did they like it? >> extremely nervous. are y you are trying to memorize your pitch and you said it to yourself 10,000 times. it's nervewr wracking. it's very well received. it was a lot different than i expected. >> when you're ready to reconsume your wine, you just press this button -- >> that's right. >> down it goes and it shrivels right up. that would be called shrinkage. thank you very much. we appreciate it. eric corti. don't forget to tune in to "shark tank" at 8:00 eastern and find out what happens. your car's health depends on a full, complete checkup. the works. because when it comes to feeling safe behind the wheel, going the distance and saving at the pump you want it all. get our multi-point inspection with a a synthetic blend oil change, tire rotation, brake inspection and more for $29.95 or less.
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a look at stocks right now, and they are mixed. mostly flat. really not a lot of movement. the action has been in the nasdaq, reaching a 13 1/2 year high. sheila dharmarajan checking that earlier. keep in mind we are coming off of two straight weeks of gains for stocks and the best week last week of the year. three winners to show you, forest labs and actavis. and another big winner, first
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solar. tyler, little bit of m & a excitement. >> thank you very much. it's been quite a comeback from market lows over the past couple weeks, up about 5% on most of the major barometers. i will keep playing with my air cork here. that will do it for this edition of "power lunch." "street signs" begins right now. your numbers of the day today, 13 1/2. the amount of time in years it's been since the nasdaq has been at this level. 62, the number of time in years it's been since the u.s. has won a medal in an olympic sport until today. you will hear from the men who did it. and 1323, the amount of money in dollars it would cost you to buy just one ounce of gold, way up from a month ago. hi, everybody. i'm brian sullivan. if the giant olympic flame over my shoulder didn't give it away, i'm coming to you live from sochi, ru.

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