group really wants. >> we all want lunch. >> we all want lunch. >> which is just another excuse to pop more champagne. [ cork pops ] safari time! [ corks popping ] safari time! [ corks popping ] >> oh! hi, everyone. welcome to "on the money." i'm sue berrera in for becky quick. the feds are ready to close a historic chapter? and the big music star who says the future is bright for her industry but not everyone agrees with taylor swift. the trends, tech and new sounds. and what's on tap for the beer business? can kraft brewers compete with the big boys? and lastly looking for places to go on a trip. this is "on the money" starting

right now. here's a look at what's making news as we head into a new week "on the money." a controversial chapter is closing for the federal reserve. in minutes released this week the feds open market committee said its bond-buying program would come to an end after the october meeting. the first time the omc has given a specific date. the bond purchases are to keep the interest rates low and stimulate the economy. the fed didn't give any firm guidance on when it will raise the interest rates. the markets broke a two-day losing streak on wednesday but fell on thursday over worries about a european bank. stocks rebounded on friday. the federal trade commission is filing suit against amazon.com accusing the company of billing parents for billions of dollars in unwanted app purchases by kids. they occurred on kindle fire tablets and other devices. amazon calls the ftc action deeply disappointing. reports of the death of the personal commuter may be greatly exaggerated.

a survey released this week shows pc shipments in the second quarter of the year did better than anticipated due in part to businesses replacing older desktops. europe bubbles up, the fed sets an end to a big program and earnings season is about to begin. so what does it mean for the markets and perhaps more importantly your money? joining us with more is michael fredericks. it's a go-anywhere fund with more than $8 billion in assets under management. good to see you, michael, thank you for being here. >> thank you. >> europe kind of loomed its ugly head once again bubbling up with worries about banks over there, specifically in portugal. how worried should we be about europe at this point? >> well, it's -- the issue is, we think, probably very isolated, but it is not very transparent. so the market, i think, is still trying to determine what exactly is happening within this entity. we don't have exposure to this but it does raise questions

about the broader health of the european financial system, i think. in general we do think it's isolated but these episodes don't -- aren't particularly good for confidence. >> they certainly aren't. we saw that in our market this week. added to that, the fed set an end to its big program, its big buying program, perhaps that's not really a surprise because they have telegraphed that it will be coming to an end. what do you think the implications are for the markets? >> so the market is really -- this was expected so it was expected they would announce they would cease the taper. what comes next, i think, is really a function of what is the direction of the economy and this is the hot topic right now particularly in the bond market, is when does the fed start to raise rates? and i think it's difficult to handicap, but we think rates are probably going to rise sooner rather than the market expects. so we are not so worried about ten-year treasury yields moving a lot higher from 2.5 or so where they are priced now, but

we do think that the front end of the curve or the short-term of bonds are a little too complacent that rates aren't moving higher any time soon. so we'll have to see how the economy develops over the course of the remainder of the year. but in general we think it's definitely improving and the fed will raise rates sooner rather than later. >> it comes at a time when we are going into earnings season as well. expectations in previous earnings seasons have been ratcheted down. so when companies just met their numbers, the street was enthusiastic about it. how do you feel going into this earnings season? are corporate balance sheets in better shape than they have been in the past? >> i think it's going to be a similar story to your point, expectations have come down and yield in general we expect to see most companies beat that lowered guidance. so it's kind of a hallow victory really, but in general we think that the market yield, we'll see earnings growth for the year somewhere near 8% give or take. >> that's not bad. >> it's not bad. and the evaluations are a little

expensive we would argue but not stretched in the equity market. so stocks relative to bonds, we think it's the place to be, but i think -- if there's a gold locks scenario, it's the economy grows at a healthy clip this year, and that's the right zone for equities, if the economy really heats up, i think you'll see the market focus on rising interest rates and the market, equity market could take that badly as a sign that the tail winds from central bank policy are starting to abate. >> you kind give me the perfect segway there because you mentioned valuations, which you think are a little stretched. and the interest rate scenario. so if you put that into context in terms of how far more to the upside you think this market has in terms of room to run, because we haven't seen the 10% correction that those long-term bums would like to see. they want to get in and get

value plays. we have not seen that correction yet. but it doesn't sound like you think the market looks frothy either. >> i think you see the froth more in the bond market than you see it in segments of high-yield bonds and bank loans that just seem to us, the market is too complacent and there's no margin for error. but in the equity market, yes, valuations are a little expensive but are not excessive. earnings growth looks solid, it's a good thing to be from a short-term perspective. there's a lingering doubt that it is so orderly and volatility is so low. where is the pull-back. it hasn't happened but we have hedged some of our equity positions so we have more equity than we have had in the past with our funds, but we have hedged that with put options as a backdrop because it does feel in a short-term perspective a little overbought. it's ban good run. >> michael, it's been a pleasure, thank you very much for joining us today. appreciate it. >> thank you. coming up, we are "on the money." a big star who says albums can

still make money in a digital age. does this ring true or is it time for taylor swift to face the music? later brewing up business with kraft beer. americans entrepreneurial taste is on tap to brooklyn and beyond. and as we go to break, a look at how the stock market ended the week.

this week taylor swift had the music industry buzzing with her wall street journal op-ed. that's right, the 24-year-old surprised everyone by saying there are still profits to be made from albums in spite of piracy, file sharing and streaming. is the songstress right or too

optimistic about the future? joining me is mela patell and allen light. welcome, gentlemen, nice to have you here. mela, i'm going to start with you. you disagree with taylor swift. on basically she's being too naive about the way the industry works. tell me what you took issue with in her op-ed? >> i don't think she's being too naive but she's a huge star with a huge fan base that want to pay her for things. and being taylor swift is extraordinary valuable. and when you have that perspective, you can release anything and people will buy it. i think if you are a new artist, it is extraordinarily hard to get people to pay attention to you let alone pay money for albums. what you are looking in the industry is album sales are plummeting because of the infinite supply of music. for taylor swift to say albums should be high priced because that's what works if you are an artist only works for taylor

swift. >> maybe she's being a disrupter to go against the stream, stream being streaming. so you agree with some of what she had to say. >> well, i think there's a lot she had to say about the relationships between artists and fans and how that has changed and how that really needs to be the priority that somebody isn't going to -- because they like your song, doesn't mean they are going to buy an album or ticket or whatever, that this is something that needs to be cultivated and she's done masterfully through her career. and what we have seen is fans will pay for stuff, whether it's jack white's record club or nine inch nails doing limited releases. >> but that's all stuff. it's physical objects. that's what people pay for. >> albums at this point need to be souvenirs, we see it now with the phenomenon around "frozen." this is selling albums through the roof because kids want to retain that relationship singing the songs over and over, have that souvenir. >> but the stuff, the stuff is

physically scarce, right? it follows the normal laws of supply and demand. >> it's finite. >> the stuff on the internet is infinite and people kind of don't want to pay for it. if you talk to the industry, people say, people don't want to pay for music, we have to create other things, experiences, taylor swift said my concerts have to be spectacles and surprising. so what you're seeing is the biggest change in media which happened a decade ago when the ipod came out, right? we have de-coupled the media from its physical form. the value is all in the physical form. so now the music itself, the price of it is falling to zero. >> i was going to say then do the artists then have to re-think or be willing to take less on their product if they do not create that experience that taylor swift is talking about? >> yeah, i think unless you have a scarce product, the price people are willing to pay will fall to zero. and you're seeing it all over the place. >> but i think that, you know, being able to then turn that into the concert tickets, the

p merchandise, the other extensions of that artist, that obviously is what drives it. >> i think the happier flip side is there are 16-year-old kids on youtube making $25,000 in advertising revenue by having a deep connection to their audience that wants to watch them talk about how to take a selfie. and that's really important. that's where all of the business is going. so when the music business is talking about streaming, streaming is up 40% or album sales are down 70% or a ridiculous number. >> the technology you mentioned and the technology in general that is changing the music industry, alan, what does that mean for the future of different genres of music, country, hip-hop, you know, whatever you're talking about? >> well, i think two things. we are certainly seeing a blurring of those distinctions, the shuffle generation is coming of age. and you see hits of the deejay with a huge hit and a country singer and an acoustic guitar. country and hip-hop are fusing

into that's what country radio sounds like now. so a lot of those pieces are going away. and i think that's great. i think we now have kids who have grown up listening to lots of things and lots of context and that should be good for where the music itself develops. >> we have to leave it there. thanks, guys, appreciate it very much. >> thank you, sue. >> thank you. up next, we are "on the money." small batch, big taste and a big business. a look at the revolution in american kraft beer with the founder of the brooklyn brewery. and later, why getting away from it all may leave you a little bit of sticker shock this year. how to still save on that much-needed summer vacation.

beer drinking in america may be on the decline? maybe, but consumption of kraft beer like in the brookly brewery rises every year. the co-founder of brooklyn brewery is joining us. thank you for joining us. >> it's great to be here. >> you got an interesting start in kraft beer, correct? >> i worked for a.p. in the late '70s/early '80s. so i covered a lot of wars in iran, iraq, lebanon. i was sitting behind presidents that were killed in cairo.

but the biggest impact in my life was meeting american journalists, i mean american diplomats in cairo based in saudi arabia where they have islamic law, no alcoholic beverages and they all made their own beer at home. so i started making my own beer and came back to new york and got carried away with the whole thing. >> what's the state of the kraft beer market right now. >> well, it's booming. it's really quite amazing. in the last ten years, there's been an incredible spike in craft beer sales. it's been double-digit growth for the last five years for the whole segment. my company has grown by 25% for the last, each of the last five years. so it's quite remarkable. craft beer has really caught on in america. it didn't happen overnight. but it's happening now. >> well, let's taste some of what you've brought. you've brought a number of different things.

this is the cuve nua? >> every quarter we release the new belgian style beer in bottles. please try it. it's a strong stout aged in bourbon barrels for more than six months. and for a minute, with first firmenation with a belgian yeast, it has some very fruity interesting flavors to it. it's wonderful. >> that's delightful. >> yeah. >> that's really delightful. we are going to move on to the great market wheat. >> this beer is a beer we do with grow nyc. the company that runs the green markets, the farmer's markets in new york city. there are 53 farmer's markets. and this is made with grain grown in new york state. >> oh, fantastic. so it's along the lines of the

farm to table kind of movement that's going on right now, right? >> yes. this is a true local beer. >> and it's much lighter. much lighter. i don't know if you can tell in the color. >> and this is a german style wheat beer. and a wonderful beer for the summertime with a salad. >> this is great for a hot day. the first one that we tasted was much, much heavier. >> the hallmark of craft brewing is innovation. and exploring all these different styles. the barrel aging with couvee noir is the second time in the bottle with the champagne yeast. so that's how you get the incredible intense fruity flavors. >> as the popularity continues to increase. and we've heard about hot shortages and things like that, do you worry that your industry isn't in a bubble formation? we have seen crumbs go bankrupt, the cupcake phenomenon seems to be waning at all. or is the foundation of your

industry fundamentally different than those? >> i feel that craft beer is finding a place in america that maybe was occupied by beer before pro hi bigs. you know, before prohibition every city had at least one brewery. and big cities like new york had more than 100 breweries. and at that time the population in america was about 40 or 50 million. today the population is 325 million and then we have 3,000 breweries. we can easily double the number of breweries, i think. there are plenty of beer drinkers out there who we are looking to introduce craft beer to. >> and it is delicious. it really is. thank you so much for sharing it with us, steve. best of luck. >> great to be here. thank you, sue. up next, "on the money," a look at the week ahead.

and driving demand for resorts and airlines, but can you still find a good deal? we'll show you how. [ male announcer ] don't just visit miami.

[ jackhammer pounding, horns honking ] [ siren wailing ] visit tripadvisor miami. [ bird chirping ] with millions of reviews, tripadvisor makes any destination better. for more on our show and our guests, go to our website, otm.cnbc.com. and follow us on twitter @onthe it's money. earnings season is in full swing with banks morgan stanley, citigroup, jpmorgan chase, bank of america and goldman sachs all reporting results. other companies to watch are

intel, ibm, general electric, yahoo! and google. on tuesday, retail sales for june are due out. also on tuesday, federal reserve chair janette yellin will testify before congress on monetary policy. then on thursday we'll get housing starts. also on thursday general motors' ceo mary barra returns to capitol hill to testify about the company's massive car recall. according to a recent survey, three in four americans are planning to take a vacation this summer. that's a big number compared to 59% in 2012. hitting the road or flying the friendly skies doesn't have to wipe out your wallet, however. travel and leisure's international editor mark orwall has websites and destinations that can save you big-time money on your next get away. good to see you, mark. thank you for being here. >> sure. >> so the july 4th weekend we saw the cost of domestic airfares up 3.5% or so from last year. hotels were also up. so now that we're into summer, is it too late to get a good

deal? >> no, and i'm going to tell you some, give you some websites, some apps that are really going to help you and everybody else. let's start with airfare. you know that if you can be a little flexible you can get better airfares. well, there's a website called adioso. you don't just have to put in dates and destinations, you can say europe sometime in the fall for ten days and it will give you all of the options, often at rock bottom airfares. when it comes to hotels, especially for business travelers, you have to book at the last minute. there's a great app for you called hotel tonight. what you can do is they will get you rates of half off, sometimes 60% off because the hotel owners are scared to death of having an empty room overnight. that's lost revenue they will never recoup. a great app. the last thing i want to tell you about that is priceline's name your own price for rental cars. everybody knows about it for hotels, but for the rental cars you can easily save 60%. i just went to give a speech in

maine, the maine's governors conference on tourism, i used the priceline name your own price and saved probably half of what i would have gotten had i gone directly to the car rental. remember, caveat on that, no refunds for name your own price tool. >> you have to know what you want and what you're doing. you know, you talked about flexibility, if indeed you do have to do last-minute, before you book a flight, what do you really need to know? >> well, i want to tell you about the best days to travel if you can be flexible if you asked. tuesday, wednesday, saturday, those are when you will save the money when you fly. business travelers are out monday and thursday, so those prices are up. most leisure travelers want to fly on friday and return on sunday to maximize their vacation time. those prices are up. so what's left? tuesday, wednesday, saturday, save some money by flying on those days. >> i'm going to write that down because i have not planned mine yet. if you want to say in the united states like a majority of the recent people surveyed wanted to do, are there certain cities that are standouts for the summer? >> absolutely. in fact, competition is the

traveler's friend. so you want to look places where the airports have the most airlines and most flights and where the cities have the most hotel rooms. that's going to give you just by default you're going to go, los angeles, las vegas, chicago, new york, the greater orlando area. i mean, i can go on. atlanta would be another one. but you can figure those out. you're going to find the best airfares and hotel deals all rolled into one. it's a great deal. >> you just helped me plan my vacation, mark, thank you so much. mark orwall, pleasure again to see you, mark. will recaall right. that's the show for today. each week keep it here because we are "on the money." and have a great weekend. bulldog: it's true! i am a bundle of talent!

but my friends are learning skills that can change a life. that's why mattress discounters good deed dogs is raising money to help train dogs like suzie to engage students in schools and special education classes. while ginger visits folks in the hospital offering quiet comfort. with your help, we can do even more! make a donation at mattressdiscountersdogs.com or any mattress discounters. mattress discounters good deed dogs helping dogs help people.

[ticking] >> what would you do with your money if you were fabulously wealthy like greg carr? he decided to pour it into one of the most beautiful places on earth. so what are his rewards? well, to begin with, he's a local hero like few we've seen before. >> [speaking foreign language] >> all: [cheering response] [ticking] >> it's harvest time in the great vineyards of italy, none greater than the 5,000 acres farmed by the antinori family. they've been in the same line of