a check on what is winning. big talk about beer and whether there is a consolidation play about to sweep through there which you called earlier in the show. >> always a pleasure. thanks for joining me today. >> absolutely. >> "street signs" right now. > . and welcome to the new trading week on "street signs." what a week it will be. lucky i have steve leesman along for the ride. there is the biggest us ipo in history and potential divorce british style. the lead lawyer for gm will speak minutes from now. to tip or not tip the house keeping staff. >> thanks for having me here.

stocks at this hour are mixed with two hours left in the trading session. nasdaq struggling down about a percent there. dow is to the upside about 13 points. the yen doing a little worse than it was before. our market reporters are standing by. mary thompson is at the new york stock exchange. >> the nasdaq is really the story today as investors await feds decision and statement on wednesday. the alibaba ipo on friday. take a look at the nasdaq. this is the index we are watching down over 1% trading close to the lows of the session. we are seeing a lot of investors selling the momentum stocks and sell some of the other stocks that might have an overlap with alibaba as they look to raise money ahead of the ipo. some stocks under pressure along with momentum stocks seeing weakness in the internet retail space and chinese stocks under a

lot of pressure today. as mentioned a little while ago it is a merger monday. there is speculation about what consolidations are going to happen. this is reportedly happening in brewing area. some of the brewers might be looking to consolidate. there are reports that we could have a bid for miller. the reason we put altria because they own a stake in that. >> let's go to rich santelli in chicago for an update on the interest rate markets. >> you know as well as anyone that this week is beginning of some very important fed meetings. we could do surveys and talk to traders and of course everybody has an opinion. the only opinion that matters is that committee. down here they say they are not sure how they will proceed. many are looking at the five

year sector. it seems to be the most sold sector. it is flirting with the highest yields that we have seen since september of last year. it is very close to back to may of 2011. what you want to watch is 1.85 on the yield close basis and drifted lower on weak data. >> thank you very much. >> since we have you might as well make full use of you. >> no rest for the really good or the wicked or the weary. >> we are going to have a discussion on the economy coming up. i want to give people an update on where we are. the numbers are extraordinary. this is where we put together the tracking surveys of ten economists out there. tracking 3.2% unchanged from the industrial production. new york state manufacturing did

well. q 2 tracking 4.5%. average those two together and you get about 3.9%, the best quarter since the down turn was 4%. a lot of data this week. ppi coming up. cpi, consumer inflation. housing starts seem down. and then the fed meeting happens on wednesday we get the statement. the idea is there is a lot of controversy. there is considerable uncertainty over the term considerable time. will they drop it? what kind of guidance do we get from the federal reserve? >> you just gave us a considerable amount of data. what is your hunch on what we will get on wednesday? >> i think the fed is going to tweak the considerable time phrase. i think it is very close call but what they end up doing. >> a really big week for investors. the federal reserve meeting. janet yellin has the news

conference and the alibaba ipo, not just the biggest in u.s. history but possibly biggest in global history. let's bring in don lusken. i understand you are in the camp that does not expect surprises from the fed and you don't think there are any meaningful changes to the statement. >> i think that the fed relieves rates for a considerable period of time. i don't look for much language change here. if we were four or five months away from a rate change the fed would start giving us really strong hints then. i think it is the second half of next year type of thing. this is way too early for the fed to start dropping hints that the interest rate hikes are in the near term. >> thinks considerable time remains.

arguing that is the way the fed would be undermining the credibility to make the change at the wednesday meeting. i think there is some credibility to what he is saying right there. >> i would agree. i think that before we really see some type of language change we are going to hear conversation beforehand whether it is a fed speaker or janet yellin doing something. the fed has to tread carefully here. they are going to give us not an -- they are certainly not giving a nine month indication ahead of time but three, four, five months ahead of time they will start talking about it. we will see it in a statement then and see more speeches about it. i think there is not a big chance that we see considerable removed from that statement. >> let's go beyond the wednesday meeting and talk about the trajectory here. when do you expect the first-rate hike? should investors be comfortable

that there is a long period of low rates in the future? >> now you are getting to know what the secret sauce is. it is not going to matter to investors whether we go from zero to 50 basis points whether in april, june, september, that doesn't matter. that tells the bond investor how to discount first couple of coupons. what is the fed's policy going to be ten years from now. and janet yellin has given us the answer to that if we will listen to her. in all of her statements so far there has been a single sentence of 38 words. and that will not change on wednesday. those 38 words say that even when we are back to maximum employment and stable prices, maybe 3.8% unemployment and 3.5% inflation because janet yellin thinks we need to get inflation up in the future. even at 3.8% unemployment and

3.5% inflation they are saying in the 38 words that the fed funds rate will still be below normal. when any central bank taking the punch bowl away they are putting ecstasy in it. what is not to love? >> what else is there in the week that has potential to move mark markets. i think you think scotland is a nonevent for our markets. >> we can file scotland in w file. >> i don't see why the uk should care other than emotionally. there may be strong family feelings about it. financial markets shouldn't give a darn. i am hard pressed to figure out what the big deal is. does it matter what currency they use. five million people it doesn't matter. what really matters is the alibaba ipo on friday. for all the good things

happening in the world this absolutely ipo scares the hell out of me. it stinks. it has correction written all over it. you have people waiting 45 minutes to go up the elevator because they think he is the smartest man in the world. the smartest man in the world is selling shares in his company you want to buy them? i think the market is going to go through a correction. >> you think it is signaling a top of sorts? >> i think it is signaling just that little edge of mania. these are smart people. they wait for these moments. they wait for these windows and then they sell you this stock that they have been adding value to, adding spin to all of these years. the story we were saying that people are selling other e-commerce stocks to buy it you are selling amazon so you can hold the bag on alibaba have a happy day. >> the nasdaq is down about 1.3%. great to hear your thoughts.

thank you very much. >> thank you. thanks for participating in the fed survey that comes out tomorrow. the great people of scotland decide if they want to remain a part of the united kingdom, something wall street is closely watching. let's bring in chief international correspondent with more. i don't know if you are ready for this question. here is my first question. does scotland keep the oil? >> that is a good question. i think everything will be in negotiation if scotland votes yes. this is the work they came up with in advance where they have 18 months to figure out the questions. i think bottom line is they would get some if not a substantial portion of the oil revenue. the second point is that there is intense debate about how much oil revenue there is.

those who favor independence say there is tons of it. those against independence say the amount of oil is declining. >> a moment ago you probably heard him say not only should the u.s. investor not really care about what is going on with scotland and england but maybe even they shouldn't care too much from an investment point of view. would you push back on that? >> i would push back a little bit. it is nearly 10% of the united kingdom's gdp. is england going to survive? of course it is. scotland will survive. there will be economic consequences. the other really important thing is in the early going how are people going to react when it comes to the banking system? there are concerns about what the future will look like. i think when you look at the polls they are so, so close. some show the noes lead by a

little bit. one shows the yes lead by a little bit. when you include the i don't knows and undecided it looks like a toss up. i think that is why you have seen so much uncertainty about what will happen there because people are not sure what the economic outcome is going to be. >> that's right. a lot of people talk about the concerns about scotland breaking away but concerns about what the rest of the uk have to gain. >> i ask the oil question because oil, whiskey and whatever role sheep play in the economy there are countries with currencies based on less than that. >> absolutely for sure. i think some of the fears that are talked about are overstated when it comes to there is going to be some kind of crisis et cetera or the brits aren't going to let them use the pound. it is not up to england what scots want to use. they can use whatever currency they want. it can be done. what are the costs of doing

that? there are costs. >> there are always costs with that and starting from scratch. maybe they can use whiskey as currency like in the olden days? >> that might work. >> they have a lot of it. it is a grim day for general motors as it announces details on the first damage claims relating to the faulty gm vehicles. we get reaction from the victims' lead attorney ahead. later to tip or not to tip. marriott encouraging customers to tip the house keeping staff. do you normally tip people who clean your hotel room. if so how often? i make a lot of purchases for my business.

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it's hard to feel normal, when you can't do the normal things. to help, sleep train is collecting donations for the extra activities that, for most kids, are a normal part of growing up. not everyone can be a foster parent... but anyone can help a foster child. welcome back. general motors compensation fund announcing first round of victim claims resulting from faulty vehicles. >> standing out are the number of claims received particularly those involving fatalities and the number of those deemed eligible. a total of 445 claims filed since august 1. 125 of those involve people passing away in the accidents. 19 of the deceased claims deemed

eligible for some type of payment. just because only 31 approved doesn't mean the rest are rejected. expected first claims to be paid in the next 30 to 45 days and hopes the compensation fund will clear about 90% of the recalled cases and made it clear once they determine the amount of the award being offered that is it. there is no negotiations. >> i'm not interested in negotiation. the protocol that everybody knows is very transparent. we have laid out the formulas that we will use. these are the formulas. here are the calculations. if you want the money sign. we have an arrangement. i will send the money. if not you can sue. >> general motors upon the release of the numbers from the gm victim compensation fund say they will independently determine the final number of

eligible individuals. we take a look at shares of general motors. the reason i pointed out that number of 19 eligible fatality claims, the reason that is important is because for months general motors had 13 fatalities even though lawyers, safety advocates and others saying this number is much higher gm said it is 13. already ken feinberg said that number is 19 and it will go higher. >> i want to bring in the lawyer who is representing the families of 90 gm victims and more than 1,300 injured individuals and 11 of the 19 death claims that ken feinberg announced this morning. what do you think of the announcements this morning? >> it is a pleasure to be here. we have been saying gm was flat

wrong when they tried to frame the conversation by saying there were 13 deaths. it is factually impossible given the amount of years, actually a decade that they covered up the fraud and the amount of accidents that we know occur d as a result of the ignition switch. i promise you that 19 is not the final number and it will continue to grow. >> what is your number? i am looking for the actual language that we said, did we imply there are maybe 90 victims? >> there is going to be hundreds of victims -- >> i mean deaths. as many as 90 deaths perhaps? >> more than that. the problem with the math is the cover up worked. for example, i have clients who had accidents in '02 and '03 when the fraud was active and the cover up was in place.

it is impossible to go find police reports or find photographs. so even though the number will continue to grow and i believe will exceed 100 it is still a comment on the success of the cover up that will never know the actual full amount of victims. >> i want to bring you in here as a reporter and an expert. what is your response or what do you know, what do you think gm thinks about this idea that maybe there are triple digits in terms of deaths? >> officially general motors says we have said that it was 13. we acknowledge that there are others who think it is higher. they are stepping back. when you talk with people inside the company this has gone on for so long that many are throwing hands in the air saying who knows how many more there might be out there. i have a quick question for bob. of those 11 of these 19 that have been deemed eligible,

fatality cases, 11 of those are your clients. will your clients take what will be offered? i know nothing has been offered officially. what does your gut say? >> some will and some won't. it will depend on how much the award is and the facts of each case. for example, if some of my clients are prebankruptcy. as you know gm is in the bankruptcy court in new york arguing that they deserve full bankruptcy protection for every accident that occurred pre2009. it is my responsibility to explain to my client that if they are successful and your case occurred pre'09 you will be kicked out of court and won't get any compensation. other clients where bankruptcy is not an issue if there is clear evidence of ignition switch defect and no contributory negligence they may say no thank you. i would like to go to court and

let a jury determine what gm's responsibility and liability is. >> what is your feeling on what the dollar amount will end up being? >> well, ken feinberg is right. the value is black and white. there is amount for loss of life and calculation for the lost earning potential of the individual. so it is very case specific. for example, if you have a 20 year old who passed away in a chevy cobalt. we know how much that 20 year old would make over the course of his or her working life generally. if you have someone who has higher education, for example, one of my clients was just graduating from law school and already had accepted a job with a law firm. so we know her income at the start of her career was very high. and after her death we also know her loss over the course of her

life is in the millions of dollars. the calculations are all knowable but are very individualized for each specific case. yo ahave to look at each case and show the client the calculation and give them the risks and the benefits of whether they should accept the award. >> understood. thank you very much for your expertise. thank you. >> you're welcome. >> let's have a quick market flash. >> check out shares of america mobile. this is a latin america telecom company. stock is spiking on a report that it is seeking a potential bid for $17.5 billion worth of assets along the eastern coast of mexico. the pitch being made. the stock is controlled again. it is up for session highs. >> we have been expecting a

merger move for some time now. now the hunters are out. we are about to look at the current targets and who could be next. >> i am looking up to that. the china factor. has the market been so overly focused on ukraine that it is ignoring what is happening with the world's second largest economy? wait , wait, wait...whoa, does she have special powers when she has the shroud? no. guys? it's the woven one the woven one. oh, oh that gives her invincibility. guys? no, no, no... the scarlet king is lord victor's son!! no don't. i told you! you guys are gonna be so surprised when you watch the finale!!! you're so lucky your car has wi-fi. yeah...i am. equinox from chevrolet... the first and only car company to bring built-in 4g lte wi-fi to cars, trucks and crossovers.

. big beer battle brewing after heineken skunked the offer. >> i don't know what gave you the impression that i like beer, heineken debunking. consolidation appears to be all the buzz in the beer business. sab heineken merger would have created a company large enough to rival anheiser busch. all the players here, one thing is for certain, they are all looking for combos to spur

global birth. beer consumption world wide is poised to pop 14% through 2017. look at where that is coming from. take a look at these regions right here. asia pacific forecast to increase over 26% through 2016. middle east and africa 27% and latin america 18%. on the flip side western europe set for declines of 4%. north america near flat around 1% and that is despite the boom we are seeing in craft brew. sab miller's rejected bid kicks off what is considered a new phase for the brewers. >> global consolidation in the beer business has been going on for about 15 years. this is sort of the next iteration. you have four players that are almost half of global beer volume but more like 60% of global beer earnings. now we are to the phases sort of

like the dance of the elephants where big companies have to go after the big companies. >> that dance is really just getting started. others could be up for grabs including molson coors on speculation it could be a target or that it could also be a buyer if sab is forced to divest its stake in the joint venture. i think the only thing to make the graphics better is if we could just hold this down. >> gush out like a fire hose. >> it would be worth it. >> this isn't the first time you served beer. you spent some time behind the bar. >> i spent some time behind the bar. that is how i got myself through college. >> you look so experienced in front of the taps. i want to be clear on that. >> is this the latest beer battle just the beginning of more consolidation talks to come? here on set is editor at large

of beverage world magazine. they are going to buy each other and craft brewers will take what is left after the big guys buy it and then the big guys buy the craft brewers? >> that is sort of like a very simple way of looking at it. i think what you have going on the big guys get bigger and the small guys are still grabbing a lot of the head lines. you look at the craft beer market. that is up about 18%. the macrobeer market is about flat. it is a small part of the market. >> what kind of odds do you put on these big mergers here? are they both going to buy heineken? >> apparently heineken rebuffed sab miller on their acquisition overtures. now there has been talk on and

off for years now on sab miller merger. >> the top two. >> pretty much if they combine about 30% of the global beer market if they did that. on and off the talk has been there. it seems to be picking up steam now especially in light of the heineken news and the one hurdle is, of course, the u.s. market where there is a lot of regulatory hurdles to get to. >> absolutely. dance of the elephants is an excellent way to put it. if i was a regulator i would be worried about competition here. is that something that might kill some of these deals? >> i think it might. if you look at what happened when modello was being bought last year there were regulators that put the brakes on it before they redid the deal. i think anything like that obviously they are going to have

to divest the miller business, the miller coors will have to break up. mollson coors might buy the miller business. but, again, these are a lot of hurdles. this seems to be closer than it has ever been. there hasn't been this much chatter in a while about it. again, even if there was an announcement tomorrow this is a long road ahead. >> could be divestitures along the way. thank you for joining us. >> i wouldn't be the guest co anchor here and steal your read. >> i am generous. coming up next the best bets for your money. going to give top picks next. >> don't forget about today's twitter poll. marriott encouraging customers to tip the house keeping staff so they don't have to. do you normally tip the people

who clean your hotel room and if so how much do you tip? if so tweet us. we will share some responses when "street signs" comes right back. financial noise financial noise financial noise

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you can see the dow and s&p are holding in positive territory. before it was having its worst drop in about 1 1/2 months. pim co with a new report detailing what they think are the best investment opportunities in the market right now. joining us pimco deputy ceo. there is an idea behind each of these things. why don't you lay out what the concept is when you are looking for a best investment here? >> what we have been looking for is industries with superior growth near term cyclical growth as well as long term secular

growth, industries with pricing power and looking for high barriers to entry, companies with unique licenses, spectrum, permits or real estate that make them really good long term investments. >> i love the barriers to entry because each industry has a capital barrier or legal barrier or some form of barrier. >> that is right and the sectors you have identified here i understand are energy, wireless and lodging. can you tell us which names in particular you have identified? >> for energy we like two sectors. we like lng exports which is a company calledtia near energy. the marcellus shale putting out incremental gas. lng exported in about two or three years. they are going to be exporting basically about 5% of the gas supply in the country in about

four or five years. target resources is a company that gathers, process and fractionates and are booming because of the permian basin. this is a company growing at 30% a year. it's mid stream energy. >> what about wireless? >> in wireless basically we like spectrum players. we like verizon. verizon has 105 million subscribers. they are growing average revenue 5%. this company is throwing up $17 billion of free cash flow. it can organically delever balance sheet. this company the bond holders win and equity holders win. >> i am looking at the charts here. really hasn't been that great over the past year. i think it is up just over a percent. what makes you think that it will start outperforming? >> this is a company that has a

dividend of 4.5%. the equity multiple is 6.5 times cash flow. when verizon bought back the 45% ownership in verizon wireless selling a lot of equity those sales are dissipating so that stock given the valuation we think has quite a bit of upside. >> last one is lodging. you have starwood and win. >> the business traveler is back. the consumer is traveling again. this is focused on the high end. starwood was up over 6%. they are raising rates basically 3.5%. occupancy is up 3%. win is basically a play on vegas. it was up 8%. occupancy is up nearly 95%. 73% of the growth in the future will come from asia where they are spending $4 billion to build

the most expensive casino ever. we think that will propel growth 20% for winn going forward. >> have to make sure the gaming boom continues. we will leave it there. thank you. real quick trivia. where is the marcellus shale? >> pennsylvania. >> right in your backyard. >> big oil developments in our backyard. >> i wish i had a backyard. i live in an apartment. >> with a derrick on the patio. the iphone 6 is flying off the shelves before it hits the shelves. we have the numbers. and the guy who created mine craft and sold it to microsoft for a couple billion dollars leaving the company. wait until you hear his parting words.

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time now for some hard money. strong dollar and weakness from china continuing to put pressure on the price of oil. >> good afternoon to you. that's right, very busy day in the pits today. it started early out in the session. we did see brent crude dipping under $97 a barrel, a 26-month low for brent after the china data came out. it is the latest in a string of weak china data that traders are watching indicating that we may see demand drop in that country. of course, they are a big importer of that brent crude. meantime also we are watching wti closing up 62 points today just under $93 a barrel. this is basically a supply story here in the u.s. the market is well supplied. you have a little buying on the dip today because we have seen so much pressure.

we can't forget the impact of the dollar. dollar index sitting at the '84 handle. traders watching the fed on wednesday to see if they will say anything that will move the dollar around. short term price target here $88 on wti. back to you. >> thank you very much. meantime gasoline up nearly 20% which is translated to cheaper gas at the pump for us. it is 4 cents lower than a week ago. and about 13 cents lower than this time last year. the good news apparently for drivers could continue. gasbuddy.com says gas prices will continue dropping. >> interesting. we will be watching that for economic impact. preorder numbers for the new iphone are in and they are ridiculous. josh lipton is in san francisco.

he does a lot of this kind of reporting. how much more ridiculous is it than the ridiculous we have come to expect from the ridiculous sales? >> tim cook was quoted as saying this would be the mother of all upgrades and he wasn't kidding. preorders for the iphone 6 and iphone 6 plus hitting a new record, 4 million preorders. let's put that in some context for our viewers. the iphone 5 did 2 million preorders in the first 24 hours when it launched, demand outstripping supply. cook saying in a statement iphone 6 and iphone 6 plus are better in every way and we are thrilled customers love them as much as we do. analysts trying to model what it means. they think the preorders suggest apple could move 10 million phones this first weekend when the iphone 6 and iphone 6 plus

hits the shelves. 1 million more than when 5 s and 5 c launched. the guy who started minecraft gamers know him as notch is leaving the company now that he sold to microsoft and left behind a nice good bye note, as well, didn't he? >> actually, i can tell you i'm here at games beat this video game conference in san francisco. there is good buzz about microsoft buying mojang. you might not know the game but your kids probably do. it is a blockbuster. they sold 50 million copies. analysts reading through their notes on the deal. i saw most of them sounded pretty positive on this and means new content for x box. gaming is one important way that microsoft continues to differentiate from rivals. and gaming remains an important category for that company.

$2.5 billion is a lot of money. microsoft sits on about $86 billion in cash. marc marcus persson said he felt like his company had become a burden to him and at the end of the day he said it's about his sanity. he felt like he was happy to get out it sounded. we will see what this means for minecraft fans? >> do i know minecraft? my kids are completely addicted to it. my kids have t shirts and goods and dress up for halloween. china's economy is slowing. what does it mean for us here? it is a bigger problem for u.s. and russia? >> how much do you tip the house keepers? we have a lot of responses, a very heated topic.

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i have some breaking news. i can confirm america movil of mexico is selling assets. hired bank of america and confirm that and additional they have reached out to potential suitors such as at&t, bell canada and also chinese tell come companies. what is also clear is looking for potentially a higher valuation than what's originally been reported. perhaps as much as eight times ebita or $20 billion. the argument being that whoever ends up with the assets goes into a market such as mexico which is growing and at the same time knows that they have to face -- they get to face a competitor, carlos slim and america movil that cannot go above 50% market share and so theoretically the purchase deserves a premium. all happening because they're subject to new laws passed in mexico meant to diminish the control that carlos slim and

america movil have in mexico. back to you. >> thanks, michelle. isis, russia, ukraine. synonymous with geopolitical risk. do investors have their eyes somewhere else? china is down to the lowest industrial base in six years. should markets and investors be worried? joining us now, cnbc contributor and -- is that right? i got it. tell us now how worried are you about china and the chinese economy? >> china is slowing for sometime. the industrial production number is troubling and there has been a slowdown. but europe is in the tank. and i don't, however, think that chi in's going to fall off the edge of a cliff. my guess is this year looking at 7% growth. and but your point about the

geopolitical risk, steve, i think is right on target. everybody's talking about putin. the real place for worrying about political risk is in asia. it's the china sea. >> john, i want to shift -- >> philippines, vietnam, et cetera. >> you said 7% growth. to a lot of americans that sounds like fantastic and off the hook. but 7% is not enough and that's a big slowdown for china which did what? >> they were doing 10% up until about two years ago. >> right. >> they have been systematically shifting their economy away from the heavy capital spending they did in the financial crisis. and away from infrastructure public works towards services and what they call the tertiary economy. that slows growth over time and can't grow 10% forever or own the earth. 7% is 3 times us and infinitely

number times europe. so they're doing okay. but when you've got predictions of higher growth, people build that into copper prices. iron ore prices. and so forth. and they get disappointed and the prices can fall as we have seen. >> absolutely. i'm wondering what it means for the expansion plans of a number of u.s. multinationals. names like starbucks and gap and many, many other companies and pegged a lot of growth hopes on a growing china. >> but you know, they're not banking on the earnings of that assembly worker in quangdong but the middle class and the cities. those incomes are rising more than 10% a year which is 3 times more than the u.s. and the luxury goods but more importantly the middle class goods i think in china have a great future. urbanization is happening there. there's increasing density.

never easy to do business in china but i think the u.s. companies have a longer term vision than just one quarter, one year's numbers. >> john, i mean, we got to go but weaker commodity prices here in the states, lower growth here in america? very quickly, john. >> little bit lower growth but europe is pulling the u.s. down even more than china is. >> john, thank you for joining us today. >> pleasure. do you tip the hotel housekeepers or should a clean room be part of your stay at no extra charge? we'll read your tweets after this. setting up the perfect weg day begins with arthritis pain and two pills. afternoon arrives and feeling good, but her knee pain returns... that's two more pills. the evening's event brings laughter, joy, and more pain... when jamie says... what's that like six pills today? yeah... i can take 2 aleve for all day relief. really, and... and that's it. this is kathleen... for my arthritis pain, i now choose aleve.

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