. . hello, everyone, welcome to "on the money." i'm sue herrera. ceo pay, do they make too much? should there be reform? or is this just capitalism at work. >> and a channel for your little one, programming for babies, but is this really a good idea? and the woman who just does not want to think about it anymore. why this advertising executive wears the same outfit to work every day. and if you're worried your dream summer vacation could turn into a nightmare, the one thing you can do to make sure that does not happen. "on the money" starts right now.

this is "on the money," your money, your life, your future. here is a look at what is making news as we head into a new week on the money. american consumers took a breath last month and that is not good news for the economy. the closely watched retail sales number was flat in april, falling short of what economists expected. spending is always important because consumers make up more than two thirds of the u.s. economy. analysts say bad weather is at least in part to blame. but stocks didn't seem to mind. by thursday, the s&p 500 hit a new record, the dow was up double digits, verizon opening up its wallet, the former giant buying aol for $4.4 billion. verizon hopes to pull in ad business from mobile on line and ad presence. you may recall in 2000, aol and

time warner merged in a deal worth more than $3 billion. and the picture we told you about last week sold at christies to an anonymous buyer, it set a new record for any painting ever sold at auction. the average ceo at an s&p 500 company makes more than $13 million a year, that is more each day than the average worker makes in a year. is this just capitalism at work or is it a symptom of a broader problem in our economy? joining us, a fellow at the american enterprise institute, why the economy doesn't work without a strong middle class, he is at the center of the director for progress. david, the average ceo as we said makes on average according to their study 373 times the average worker. some would say it is just

capitalism at work. but i believe you think something else is going on here. >> yeah, it's the problem where we've shifted the rules of the economy now so it benefits those at the top far more than those in the middle. and that ratio has changed. about 30 years ago it used to be ceos made about 30 times what the average worker made, and what has happened is the pay through the top has gone through the roof while pay for most workers has grown very slowly. in fact, you can see that the income for the typical worker has actually declined since 1989. so we have things like the minimum wage is not going up so workers at the top are able to structure the rules so that they benefit even when their companies don't do very well. >> you know, jim to push back on that a little bit if it's a publicly traded company some would say okay, well, then the board should step in. the ceo is taking the stock

price and meeting shareholder expectations. >> if you actually looked at pay versus the workers in the company it's not like 400, it's more like 80. if you look at all executive pay, it's more like four. the ratios are greatly exaggerated. the median household income has gone up, so that is a different take on the income stagnation issue. you may still think that is too high, 80 is too high, why has it gone up very much? is it things like very compliant boards, lack of minimum wage, no, by far the major reasons are technology and globalizations, you have much bigger companies run by ceos who can leverage their skills and compete with a survey of companies around the world. and it's a more global technology, and you see the huge increase in ceo pay.

i should add that is not even the biggest reason why inequality has gone up. >> do you think there should be a way to cap the ratio or what you and jim were talking about. >> you can see there are the same changes in global technology which clearly contribute to the issue. but many of them have been able to have -- sustained a much higher income gains for the vast majority of their workers. countries like australia, canada, sweden have done much better. it indicates something about the rules of the game and let's just talk about one or two of the rules of the game. we have companies being able to deduct the supposed performance pays -- performance as we know is unfortunately rigged. it is -- very rarely is it true performance, they do things like backdating stock options to game the system and they still get the tax benefits for the

company. so it is very much about the rules of the game that we structure that benefit those at the top and not help those in the middle. >> and david, i want to stay with you for a minute. i assume you feel as though this gap or ratio may be damaging to the economy. >> yes, i do. and you can look at that in several ways. first, you have the very wealthy with the disproportionate political power which gives them more influence in our political system, which benefits them for things like taxes and education. the significant reason we had the great recession was because ordinary citizens whose incomes were stagnant went into debt to buy things, they didn't have enough income to purchase the ordinary basic middle class things. so the change in the distribution and the stagnation in the middle class has really hurt everybody, not just those who are struggling.

>> so jim, is part of the solution here raising the minimum wage? we've seen large companies like walmart, target, aetna, they have all made a move to raise the minimum wage. is that a step at least in the right direction? >> well, listen, all of -- the ceos combined made about $5 billion last year, if you took that money and redistributed it, it won't fundamentally change the income for most americans, and most of the game at the top has really gone through entrepreneurs. i like that, i like new products and services. the ceo compensation really does not explain the high income inequality. if you want to raise the money for workers what you really need to do is increase wage subsidies like the earned income credit, not for college students or people who were really not low income. that would be a far better way to raise the wage of the low

income worker. of course the best thing to do is have a highly educated work force who can take good paying jobs we need more good paying jobs, we need more entrepreneurs to create the start-up such as google and facebook. that is what we need. >> thank you, gentlemen, we appreciate it. >> thank you. up next, becky is back with more on the money. and should your baby learn his abcs from tv? pediatricians and parents are not agreeing with this one. we'll have more on this baby first tv. and later, it's greoundhog day every day for one worker. hear why she wants to wear the same thing every day. and before we go to break look at how the stock market ended for the week.

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>> that is >> that is a video by the first 24-hour infant channel, baby tv. they have capitalized on it by taking it to the diaper stage for babies more than six months old. should parents be concerned or is the no-tv rule just out of touch. joining us is the baby's first co-founder, sharon rechter. thank you for joining us. >> thank you. >> i can't help but sing along, this is a song we always sing with our kids all the way through. but first of all, what does it consist of? what skills does it teach babies? >> first, our program is

taylor-made for the children, and hold mom and dad's hands through the first year and help them introduce their children to math, vocabulary and art, but also asking questions such as how do things work? parents are told by all sorts of people out there and the american association of pediatrics that babies should not watch television because it could opportunity their social and creative development. after ten years in the business, how do you feel it affects babies? >> so baby first is watched by every third mom in the country with the baby under the age of three, and according to the kaiser family foundation research, 97% of babies are watching tv. so now the question is not so much should or should they not, but rather, what are our children watching? there is significant studies that indicate children can learn from tv. there is a study done by wisconsin university and on the baby first, and the study done

in alabama, children can learn, for instance if you want to teach them game of thrones, or if you want them to learn things at baby first, which is art, music and basic concept in words. but what is most important, we discourage parents and babies to use baby first to use tools to interact, for instance, if you see a red ball bouncing, we would see ask your baby what is the color of the ball? that is why we see parents and babies engaging and learning together with baby first both on the tv and app work. >> i let my son watch tv before he was 2 years old, things like elmo and some things on pbs. the baby viewership is something like 100 words a day, is that too much? is the tv just becoming a baby-sitter? >> well, we believe that parents in america are smart and trust

them to use great choices, and as long as they use baby first as a tool and to engage with children we believe it is going great. >> i have twin boys, i'm a working mother, i think there is a lot of pressure on us as moms and a lot of guilt associated with being a mother these days. and i will say if i need ten minutes to just regroup in my mind while i'm sitting with my child, i feel like a great mother. >> i took a nap yesterday and let them watch tv. >> i envy you, i do not feel like a good mother after that. let me ask you a question, if it's your bread and butter and you have to rely on advertising how does it work with babies? because they can't distinguish between ads and reality, how do you distinguish between that? >> so with baby first, if you have a child under three you will not be likely to leave him alone in the room. all of our advertising is targeting only the parents,

never the children with our ads, and because of this great co-viewing, moms are listening to us, this is a great time in their life. you know they tell us, you are not my doctor, but we only bring in sponsorships that we believe are valuable to a mother in this journey. >> okay, sharon, thank you for joining us. >> thank you for having me. up next, we're on the money. steve jobs did it, and so did albert einstein. don't miss this iss tha is important for you. and later, one big vacation stress-free.

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imagine imagine wearing the same thing day in and day out. well, one woman does it happily. it caused a bit of a firestorm on line, her harper's bazaar article on explaining why she chose to wear the same outfit 100,000 times. it has women debating the pros and cons. thank you for joining us, first, we should clarify this is not the same shirt and same pants you wear every day. you bought a lot of different pieces of the exact same thing. >> yes. >> why did you do it? >> i did it because i realized how much time and energy i could save during my work days by just picking out the clothing aspect.

>> was there one particular day when you just thought forget it? this is the end, i'm not doing this anymore? >> absolutely, it was a pretty mundane day to start with. you know, you wake up, you choose something to wear, but you end up looking like some kind of clothing hurricane throwing on and off stuff. and i finally put something on that i immediately regretted. on the platform, i get to work, and i see a bunch of co-worker walking to a meeting where i was supposed to be inside already. i was late, my sweater was inside out. and i was just standing there thinking it should not be this hard or complicated. >> it should not be this complicated. i loved your article, and i used to go to a catholic high school and it was great not to worry about what you wore for that day. i frees your brain up. you know, albert einstein used to do that as well, a lot of smart people. how long did it take people to

notice, or at least to tell you? >> well, about three years ago when i started, i just showed up. i think it was a wednesday that i wore it. i obviously continued to wear it. but it was not until two or threweeks after that someone was like you have been wearing that for quite sometime now. how are you doing with all that? so yeah, and then obviously it was a little discussion at work that started. so everybody knew after that. >> so you get a different reaction from men than women? >> i do, it is an interesting question. i have gotten it before. and i realize women get generally more into if it gets boring or not. meanwhile, men just go straight to the positive point like i can totally see how you spend so much time doing that, et cetera. >> what about outside work? do you have a uniform for that -- >> no, no, no, this is just to save me time during my work days. outside work i love color,

patterns, i will have crazy shoes, yeah, i'm very big on dresses, yeah. it's my time to shine. >> what is the craziest reaction that you have gotten, or the strangest reaction? >> oh, yeah, someone at work asked another colleague of mine, she was new there and she asked, so i knew this girl who walks around the office wearing black and white, with something around her neck, i really think she is maybe obsessed or some kind of a religious group. she must be, i can't see any other reason for why anybody should wear that. so yeah, that was pretty odd. and my old boss was even thinking the first couple of weeks, that -- they were giving me too little money that i couldn't afford new clothes, so she said we have to get matilda a raise. >> well, i am a fan, and i think it's great what you're doing. thank you for joining us. >> of course, thank you. up next on the money, a look

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for for more on our show and our guests, go to our website and follow us at twitter at "on the money." and here are the stories coming up that could impact your money this week. retailers walmart, target, home

depot and on-line crafts marketplace etsy will report earnings. tuesday, the construction amounts are due. the wednesday april meeting will be released. also wednesday, david letterman will host his last late-night show on cbs. the comedian is retiring after only 22 years on that program. thursday we'll get existing home sales data for thursday. and friday, we get an idea of inflation for the consumer price index. also on friday, disneyland will kick off its 60th birthday celebration. the start of the summer travel season is upon us and if you plan to take a trip this summer you may come across options to buy travel insurance. but is it a good idea? the senior personal correspondent sharon epperson is here with what you really need to know about travel insurance, good to see you, sharon. >> good to be here, sue. >> what about the basics? what is a good place to start? what is the cover and what does

it cost. >> well, what it usually covers, it usually covers trip cancellation and interruptions, also medical expenses and evacuation, hopefully it will not have to happen but a travel delay or lost baggage delay. >> so when do you think it makes sense to actually do this? what circumstances warrant you know the effort and the cost? >> when you think about the cost of travel insurance being about 5 to 7% of the trip or on average for a couple maybe $245, you really want to factor in how much you're paying for this trip. so an expensive vacation, several thousand dollars, $5,000 or more you probably want to get travel insurance. also if you have a type of medical insurance that may not be covered you want to be sure to get that particularly if you travel to another country. because most of the time your health insurance will not cover you in another country. if you're on medicare you also are probably going to be

somebody who wants to get travel insurance. >> i didn't really realize that, that is a good point, an awful lot of people. when should you not buy it? >> you probably don't necessarily need to buy it if it's covered by other things. you may have a credit card that perhaps covers lost baggage and baggage delay, sometimes other insurance you have may cover other things you may not need, particularly health insurance if you're traveling domestically that may cover that also. look at the package you have and see if you really need the travel insurance. >> all right, say you really have to do it. you're doing the big european trip or a trip to africa, how do you find it and kind of evaluate what is best for you? >> well, we went to a website called top consumer reviews and looked to see what they believed was the best deal. there is a site called square mouth and operates like expedia, also trip.com and

travelguard.com, you may want to try those and see what is covered. if you're taking a big trip, of course you want to get the best prices and hopefully get the travel insurance. >> well, unfortunately you will never need it, but you never know. thank you, sharon epperson, and that is the show today, thank you for joining us. next week, becky is back with a look at our nation's veterans and tips available and benefits available to them. each week, keep it here, we're "on the money." have a great weekend. see you next weekend. it begins from the the second we're born.er. after all, healthier doesn't happen all by itself. it needs to be earned... every day... using wellness to keep away illness... and believing that a single life can be made better by millions of others. healthier takes somebody who can power modern health care...

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l-that was pretty good. -mike: [ laughs ].. lemonis: ...a custom drum company can't find the rhythm to meet supply and demand. mike: our turnaround time is six to seven months. -lemonis: six to seven months? -mike: yeah. that's created a backlog of unpaid bills chris: we don't have enough money to cover payroll for next week. lemonis: i mean, you're kind of closed. chris: yeah. lemonis: the owner and his right-hand man are out of sync. louie: the lack of communication, i think, between chris and mike, it's like -- it's just...exactly. lemonis: and the two brothers who started this business have split up... scott: what did i ever do to you? mike: i really don't want to get into all that. lemonis: ...causing a whole nother layer of crippling issues. if they can't fix their process and their relationship... mike: fixing the business and this [bleep] is hard enough. lemonis: ...they'll be forced to close their doors forever. mike: i can't take this.