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tv   MONEY With Melissa Francis  FOX Business  October 14, 2013 5:00pm-6:01pm EDT

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the beltway with these negotiations. senate republicans meeting scheduled for votes has been postponed. was going to be tonight. will be tomorrow at 11:00 a.m. eastern. melissa: until then we're live hour after hour. "money" with melissa francis is next. >> i'm adam shapiro in for melissa francis. here is what is "money" tonight. >> i'm very optimistic. we reach, we will reach an agreement. it is reasonable in nature this week. >> i share his optimism. that we're going to get a result that will be acceptable to both sides. >> and don't hold your breath but could a deal finally truly be within reach? one senator on the budget committee joins us with reaction to the very latest developments happening as i'm talking to you right now. plus, how bad are things for sac's steve cohen? he is selling some of the most valuable art on the planet. it is all the word on wall street. we've got the inside scoop.
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have a couple million? could you get a bargain. >> "who made money today." he could soon be new king of your tv. stay tuned to find out who it is. even when they say it is not it is always about money. adam: there is word crossing headlines that an actual deal will be president the to the republican conference in the senate at 11:00 a.m. hope is on the horizon that our elected officials in washington, d.c. will end the impasse and finalize a deal. the tentative plan increases the debt limit through february 15th. does that mean we're just right back here in the same place in four months? joining with us latest developments is senator roger wicker a member of the senate budget committee. thank you for taking time out of what is a crazy period in
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washington to be with us and explain to us why four months from now we won't be right back where we are today? >> okay. this interview was scheduled a lot earlier today. we didn't know we would have a reported deal which this time. i doo't know the details. you may lose viewers interviewing somebody like me. adam: i don't think we would lose viewers. let me get to the heart of it. i would suspect, i'm not sure, we're not sure yet about the continuing resolution. what we're talking about is raising the debt ceiling for four more months. four hour r more months. one more year. we've been through this before. do you hear from anybody in the republican caucus or other side of the aisle from the democrats, anything tangible that prevents us from going through this ridiculous as i think you might agree repeatedly?
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>> what i hope is include ad legitimate budget negotiation. i'm a member of the budget committee. i've been wanting to go to conference for years. i would hope any temporary deal gets us to negotiations. what we need is to change the basic structure of our mandatory spending. we need to get some slowing of the growth rate of this huge federal government. that is what we really need. adam: when you bring in the discussion of mandatory spending i want to talk about that. assume whatever is presented tomorrow at 11:00 a.m. to the republicans holds muster. can john boehner deliver the house? >> i really don't know because i don't know the details. i can't imagine though that mitch mcconnell is negotiating in a vacuum. my guess he is closely discussing this with the speaker of the house actually. the house is where we have
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majority of the, republicans have the majority, not over in the senate. it fell to mitch to do negotiations this time. i'm quite sure he is talking to mr. boehner about it. adam: i'm not getting into the details but i do see crossing from our headlines from our bureau in washington that some of the deal will include tax concessions from the democrats as well as republicans. this is to raise the debt ceiling. my concern is the government shutdown and continuing resolution. do you have any news, or anything you can share with us about the progress of a budget to keep the united states governing and governable? >> my expectation whatever is announced 11:00 a.m. tomorrow will reopen the government for a temporary period and involve a temporary increase in the debt
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ceiling. let me say this about kicking the can down the road because you led this segment with that. whenever you raise the debt ceiling of necessarily it involves getting back and revisiting this issue at a later time. so it is not exactly a disaster that we have to look at it frequently. i would hope with another debt ceiling vote, looming, say, january or february of next year, if that is what the deal is. it would be great incentive for house republicans and democrats to come together as the super-committee could not do in 2011 and slow the growth rate of these very important programs. they're very popular and very important but they're growing just too fast. adam: let's talk about the continuing resolution. so we would get a debt ceiling raise up through february and continuing resolution to fund
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the government up through february 15th. does that give the 435 people in the house and those of you in the senate, enough time to work out a budget that is going to deal with mandatory spending? by that i mean social security, medicare, medicaid, obamacare as well as defense? >> well, it certainly gives us enough time, if people are negotiating in good faith. if they're, if they're not actually serious about taking some of the tough votes, that have to be made, and really can only be made during divided government then, a year wouldn't be enough time. but three months plus is yes, it is plenty of time. we know. we know what needs to be done. there is some members who have been meeting in small groups. they're trying to iron this out with republicans and democrats heading hands on this, much as
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tip o'neill did, president ronald reagan did back in the early '80s. they performed a very difficult task of slowing the growth rate of social security so that it could last another three decades. we need to be worthy of their legacy during these next three or four months. adam: senator wicker, i appreciate you joining us from the great state of mississippi. although i see you there in the capitol. these are events unfolding as we're talking. >> i need more details. adam: so do i but i think we're all, you know, the markets at least didn't take a breather. they closed up today. so they seem to be optimistic that all of you will do something that all of us can rest assured will -- >> i hope that is justified. adam: thank you very much, senator. all the best to you. >> you're welcome. adam: next on "money," former vice-chair of goldman sachs, ending the budget standoff once and for all. he says lawmakers have to act like business owners.
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he is here to explain how they can finally seal a deal. how bad is it for sac's steve cohen? he is now selling off some of the most valuable art in the world. all the word on wall street. we'll give you inside scoop. maybe the inside deal. more "money" coming up. thank you orvie and lbur... ...alia... neil and buzz: for teaching us that you can't create the future. by clinging to the past. and with that: you're history.
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adam: yes, t-minus three days until the debt ceiling deadline hits and our next guest says there is a clear-cut way out. lawmakers have to make a deal as if they own ad business. robert kaplan is a harvard business school senior associate dean for external relations, former vice-chair of goldman sachs. he joins us right now. he is author of "what you're really meant to do." let's get to the point what congress is meant to do because they're not doing it. we'll have whatever is the framework of this plan presented to the republicans at 11:00 a.m. the democrats have to accept it as well. one would assume harry reid negotiate ad deal not only mitch mcconnell can accept but democrats in the house would accept. what would you say to these people? >> then i would say, i'm sure there will be a few scary moments because boehner and the
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house have to accept this. that may not be so easy? what would i say? i don't want to minimize. i know how hard this is but you and i were just talking off-camara. both sides get a do-over here. in particular, the american people understand wanting to look at entitlements, social security, medicare, medicaid and entitlement reform. they understand tax reform. so at least now the republicans think i have a very coherent negotiating position. they may not be able to come to an agreement but at least both, at least the public understands what they're fighting about. this got off on the wrong foot at the get-go where they were talking about defunding obamacare and threats and they men over got into a negotiation. >> so we can get into a negotiation but you brought up an issue as did our last guest, about, for instance, negotiating i can remember as a kid, you were a kid, much younger, tip o'neill and saving securities & exchange commissio. >> yeah.
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adam: is that what we're talking about? who are the leaders that can do that? doesn't seem anyone in d.c. has that kind of ability. >> they have to do something which i haven't seen them do recently which they have to get into details. for example,. for example there is lot of work done on social security how to extend the life of it, whether means testing it. raising retirement age. there is way to do it. there is analysis done on obamacare which people can get into. both side have to get into the details and talk specifics. >> one thing upsets me because i think people on wall street is fascinating and important. we have to keep asking, is wall street paying attention to the markets and, but the markets are very short-term sighted. the discussion on leaders in social security is not a short term issue. >> i spent my whole career at goldman sachs in the markets.
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markets, market looks at reality says there won't be fiscal progress. the fed though will help and these guys won't do anything catastrophic. forget about all that and focus on company,. this is totally different. the people in washington have to act as, you as you said in the lead-in, like owners if i were, if anything i wanted could happen in this country, what would i want and what are the details. exactty what would i want done? so an example of a mistake in my opinion would be, to just, put off for one year the individual mandate i think is much more complex than been said, all insurance rates for this country health care are set based on individual mandate where you get healthy people. i don't think republicans have gone through the second and third level to modify that proposal. adam: on that vein, i have to tell you, that the democrats scored something in this potential deal they will delay
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one year the labor union priority, delay for one year reinsurance tax. >> yeah. adam: so how do you, if you got the democrats not acting in a manner, what is the hard decision we have to do here, why should republicans, raising a very valid issue do something to prevent this kind of chaos again? >> i agree. this is where you point out, boe going to have to not just worry about their own continue when cities. they -- constituencies. they have to do a package good for the whole country. i understand why the unions like that. i understand why dropping the device tax will appeal to some. i bet they go after both issues again before the next february deadline. adam: let me talk to you as someone who used to be in goldman. from my 401(k) standpoint, i'm terrified what will happen with my 401(k) with roughly 25 years to go? is it going to tank? i don't trust these people in washington. the markets do react to them?
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>> the stock market, operates one way. the stock market can live with dysfunction in washington. ultimately though the stock market, even the stock market assuming at some point in the next several years they're going to fix social security, they will do some type of a deal helps get us fiscal trajectory. buy a little time for fiscal policy makessers. but the market isn't optimistic about the next few years. over the long run they believe i think stocks will be fine. adam: your lips to uncle sam's ears. >> yeah. adam: let's hope they actually3 deliver what needs to be done. thank you very much, steve kaplan. robert kaplan for joining us here on "money." >> good to see you. adam: lots of moving pieces with the latest on debt ceiling deal. rich edson is following it all in washington. rich, bring us up to see. speed where do we stand right now? >> the top democrat and
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republican in the senate are negotiating a deal right now. they're trying to work outstanding issues. they haven't finalized deal. everything could be in and out. remember, not everything is set in stone until you agree with a final deal. what the framework is looking like, keep the government open until january this. extend the debt ceiling to february 15. medical device tax, delay in that tax we've been hearing so much is knot part of the deal. there is another reinsurance tax they're looking to delay. unions would like delayed. that would be a centerpiece of this. a lot of moving parts on this right now. they don't have a final deal, adam. they're hopeful that stipe in the next few hours they reach a final agreement. all the uncertainty how you get through the senate in time and over to the house and will the house pass it comes up. back to you. >> rich edson, thank you very much. robert kaplan is still with us. i want to ask you quick reaction what rich reported. i want to ask you, correct me if
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i'm wrong, we don't need the october 11th deadline, as long as the bond markets believe we get there, is that sufficient? >> iithink it will really scare people and undermined confidence if this goes on much longer. so i think they need to get this done. adam: but what rich is picking up -- >> not technically. it will be fine. adam: we can get to october 19th we'll be okay. >> i agree. adam: what rich just said, does this deliver the kind of environment in which the leaders as you describe them can come together for a real negotiation. >> i would put this analogous to the patient is in the emergency room on a defibrillator. they're going to try to revive the patient an have a dueover. so now we can get started again with a procedure process and have several weeks to negotiate. so, yeah,,if they get this through it will work. we'll have a chance to have real negotiations and i hope make some progress. adam: hopefully the patient dii not get their insurance from one of the exchanges because they're still having trouble with those.
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robert kaplan. thank you very much. >> thank you. adam: next on "money," want to know when things are getting bad for sac's steve cohen? when he has to auction off major pieces in his reknowned art collection. it is all the word on wall street and we have the multimillion-dollar details. >> debt ceiling debacle has plenty of businesses on edge. how to find financial bliss amid rampant economic uncertainty. we're bringing in the president of bliss spa for a special treatment. do you ever have too much money? customerrin swenson ordered shoes from us online
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adam: the whispers, the rumors, the behind the scenes gossip, we have it all here on "money." we're not talking about washington, d.c. the spotlight is back on hedge fund titan steve cohen a new report says
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cohen is selling three major paintings in his vast art collection amid rising legal business. all the word on wall street. here with all the juicy details, ahead of the tape columnist, spencer jacob. we have to ask you. i think that is wore who elizabeth taylor up for sale. he can't be hurting for money. he still has 9 billion. >> i think he is doing okay. there are two explanations for actions like this. one, you're shuffling portfolio. people who own a lot of art, he has been known to buy and sell. he doesn't just accumulate. if you sell a painting and buy another one you don't have a paint capital gain on it. he is seeing trends in the art world, being consummate trader he is is. the other explanation is that he is looking to pay some he hefty legal bills and personal fines and wants to be as liquid as possible. difficult to show up with the d.a.'s office with chagall or warhol and pay that. so you want to have as much cash as possible to with that
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eventuality. adam: he wants to have cash. i would think he is a little distracted right now. it may not actually be trading of art. you talked about the fact he sold what was it, a monet for 10 years and he made 29 million when he sold that. that is part of this, how do you describe it, tax credit? >> yeah. you take the capital gains. you postpone it. just like buying and selling of real estate. if you own a building for a long time and irs has a program where you, if you buy something within a certain amount of time that is roughly equivalent, then you don't pay capital gain. you postpone it until you sell that thing and postpone it forever. works the same way with art. it is possible he is playing tax games and shuffling his portfolio. adam: he is little preoccupied to do that right now? >> he is still trading stocks. he is still the most active trader on wall street even as we speak. a lot of clients yanked money. he is managing his own money, a considerable fortune and has his own clients.
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it is possible he is not worried but business as usual. adam: almost 100% of the money that was not his. he had $15 billion under management at one point. so now it is his personal wealth estimated at 9 billion. >> right. adam: seems more plausible he is trying to create the liquidity he will need right, what they're negotiateing a 2 billion-dollar settlement s that what the final figure is going to be? >> that is what i heard. there are numbers bandied b there is no official number. that is the thinking. that he is going to, hopes get away without any, hopes, prison time. adam: banned from the securities industry for a lifetime. >> he made a great amount of money. it will be a victory for him if he write as large check and still walks away a wealthy man and. >> behind bars. he has not been accused of a crime. it is his firm that has been accused. he is facing civil chars. >> two of his associates will
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come up on trial for insider trading. as we wrap this up, what are the whispers regarding steve cohen on wall street? that this guy will get away or preet bharara will surprise us and come down hard on him? >> the surprise he wouldn't personally charge. they just don't have enough evidence. they would like to charge him. they have been circling him for years but they don't have enough. when you charge someone's associates then it becomes more and more dangerous. they get, they're incentivized to -- adam: flip. >> talk and flip. that is the real danger for steve cohen that they flip. they very much like to get their pound of flesh of actual prison time for him. there is lot of circumstantial evidence but clearly not enough direct evidence to nail him yet. adam: all right. so, got a couple million lying around, buy one of these pieces of art? >> i think about it. i'll go by sotheby's to see -- adam: you prefer a small chagall? >> exactly. i go for small ones. i don't have a lot of space in
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my house in the new jersey. adam: the phillips collection has lovely renoir. boating party luncheon. thanks for joining us. >> thank you. adam: next on "money," how can businesses find bliss amid the mess in d.c.? the president of bliss, bliss spa is here with his treatment to make all the economic anxieties melt away. plus home prices are soaring and interest rates could be right behind them. if you're looking to flip a house, how can you stop your financial roof from caving in? two of the top pros in the game are here for the monthly fill of flip this. "piles of money" is coming up. ♪
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every y of the week. nturylink® your link to what's next. adam: no matter what time it is money is on the move. now we see sales tumbling forcing them to explore strategic alternatives looking for a potential partnership hoping for a
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sale to bring it back from the brink but that is not be taking well. with the washington usual this the luxury goods market remains almost entirely unscathed from fashion even when the the most recognized brands in the industry was locations across the globe we have this ceo how he keeps his customers returning but also putting the product in 3,000 stores you can find the bliss products. adam: and the holding company? hit a new a 52 week high. congratulations. you're doing something right. $380 billion sandy were tapping into the market but
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their greatest potential is tight and? >> also still in europe and latin america we are killing at the lee machine for your abs. adam: i have to ask about gross product the natural six-pack that improves the appearance of your stomach. is that dangerous? you are playing with fire. >> instead of the fat boy is the fat girl. your skin starts to tighten it did feels fantastic give that looks a firmer. adam: has won awards the unsold out in las vegas that is sold out in florida and
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hongkong. did it titans' the stomachs to barracuda's the one that? you face competition with the cosmetics industry and people make a big deal out of organics. and those that come from others? when you have no competition you don't tell it well that it would is the competition. our story is so unique id you tell it -- still a powerful we don't have competition. i to the leadership's stance but keep in mind just because it is natural does not mean it is good. a lot of things are natural. we make sure we have the
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highest efficacy, and the high delight factor in every product is safe so we have no issues. adam: i cannot speak to this through experience i have never had a facial but that can run anywhere between 85 and landed $200. if you walk down the street eupepsia pedicure or of medicare $80 or $30? >> price is the dog and leader but the numerator is the expectations. we always beat the expectations of the canada oxygen facially he will walk out looking and feeling fantastic that is the value. you could get a $20 facial but decree is not good did you will see the difference. if you have ever bet waxed it could be partly paid ball
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or a very beneficial at bliss. adam: you have something you created? >> all our technicians have been trained at least five years so it is practically painless. adam: deal stallions are behind that. but congratulations with the 52 week high wiih the big expansion plan to asia. >> 3,000 stores in 22 countries. adam: the fat girl six-pack. what is going on with the housing market? there are some specific ways you kid minimize risk if you want to flip a good find. right now we have our real estate master and author of finding and fixing and
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flipped it in john from guerrilla capital i think of a figure because i would not be successful. kid news sttll afflict a property like prior to the crash? >> absolutely. adam: michael? where would you look to flip? which has the bargain-basement prices? >> look for the markets we like to call me to the party. they had defied the market's better the to the party just about coming back up in price that were hitting the bottom and are a little slow to have crows potential..3 adam: according to a core logic they ain't right --
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increase year over year for 18 consecutive months and it seems to me like we missed this. suspect -- a special with interest rates or four and 1/4? we could get 3.eight 5% this seems that people miss the opportunity? >> a lot of value is fixing. of course, buying a distressed house but to relieve the value they add with the reid model creates such value sold you can take a home to put $30,000 into a to raise the price by 60,000 you have created value and that becomes profit. adam: what are your top three tips? pay cash? leverage through the loan? >> these are my top three.
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the double success strategy. prices are going up in interest rates are going up actually the whole market affordability is shrinking. what day you do to protect yourself? when you find a property that is a good candidate you have to make sure justin case you can also rent the property and let it carry itself. this is for the single small or first-time investor not the bigger company. that is the first thing. next the 20/20 buffered that means when you analyze a property i can promise it will cost you 20 percent more than you think and it will take 20 percent longer so factor that is write-up front. adam: john what is your top three tips?
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but the one key point is the monthly cost to carry is 1,000 make sure you can at least rented at 1,000 or walk away? >> that may be good for the individual investors but i disagree. we will take a loss be controlled by price we don't have to buy the house we can control the remodel cost we decide how much that is bad we don't control the sales price. if we are wrong in the house will not sell at '01 hundred 89,000 then we have to keep dropping it. the market will tell you what it sells for. adam: you control the cost like a business controls the margin hispanic we hope our analysis is accurate and we are most times if we say we will by the house to put
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30,000 it will sell 180 when you're done most of the time we are right. adam: then interest rates go up because of the mess in washington? >> i will go with a gas -- yes. >> not for another year. adam: those so there is still an opportunity to buy those houses. think you. looking at the newest me and your name a and picture and comments could be coming without your permission into also will not see 1 penny. at the end of the day it is all about taking the money from you.
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you really love, what would you do?" ♪ [ woman ] i'd be a writer. [ man ] i'd be a baker. [ woman ] i wanna be a pie maker. [ man ] i wanna be a pilot. [ woman ] i'd be an architect. what if told you someone could pay you and what if that person were you? ♪ when you think about it, isn't that what tirement should be, paying ourselves to do what we love? ♪ adam: googleplex its users to work without pay. so far to go plus announce plans to show the user for
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those of your comments in a minute advertisement that knbc on any of the 2 million sites in the information goes up as the unpaid divorcement it is causing a lot of backlash and we are following this story with the details but also the questions is why would they do this to the? >> settled a lawsuit with the save people that were hurt by the practice but no google does as well it it told the users to do this on friday if you have liked anything where you are on google's plus now it turns out under the terms of using that service they campbell you in the ad notes privacy people say it is already legal in many states to go
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gives users the chance to opt out. who has time to look at that >> or understand the procedure? but i do have a question. the whole process if people like me, e-mail is free i like that. you cannot get free stuff without something in return. >> also watching advertisements on their television. also you just told all of your followers on facebook they like something so what is so wrong with an advertisement that you like it? but overall we don't like stuff happening without our permission but i do think we will be in a future where the user data has a value that we want to be compensated for it when
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that will end of controversy adam: there are fake reviews so hypothetically to keep broad during gamble please write that you like a tide? >> believe it brought the ftc has argued it has the right to go after 50 million pluggers anytime they mentioned as a product it a positive light they have to refuel the have received it for free. so they have stepped didn't to make sure it did not happen before it costs started. adam: they paid me to write about the product? >> i cannot remember too many bureaucracies forcing you to say certain things they force you to reveal?
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>> but that is the disclaimer spirit that takes the ball the characters atwitter. [laughter] but if you are a consumer looking for something in it turns out your friends of google's + like the product the best it is word of mouth but it is a more effected when you hear it? adam: but i see your friends on facebook but does it influenced me? >> there probably does we already go to a crowded restaurant because everybody is already going. adam: and you are the expert i thought our buying habits were set in stone by the times we were 20. >> i don't think that is true at all. i just tried to do to live to space because i just saw
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and advertisements so i am still soluble. adam: i have been using crest for years. up next and what happens when there is the electronic glitch with the food stamp cards? the entire wal-mart's get cleaned out. small little spending spree and we have all with "spare change." [ woman ] if you have the audacity to believe your financial advisor should focus on your long-term goals, not their short-term agenda. [ woman ] if you have e nerve to believe that cookie cutters should be for cookies, not your investment strategy. if you believe in the sheer brilliance of a simple explanation.
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adam: it is time for "spare change" we're joined by monica crowley the goddess.
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and i will not refer to as a goddess today. [laughter] think you for joining us this shopping frenzy at louisiana this weekend. a glitch occurred with the food stamp cards for nearly two hours there were no limits shown on that abt card and the spokeswoman said no problem they could continue purchasing but that led to a frantic free-for-all that cleaned up this story and another one in the area they failed to work in 17 states on saturday people in ohio could not buy anything in their routine test the system failed so will they pick up the tab for the over the limit spending?
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>> we will pick that up as the american taxpayer. that is the social welfare state on out of control. though wal-mart spokesperson thought they we're doing a nice thing that this is not their fault there is a glitch go ahead. but people were overloading the cart to and there was one example she overloaded her cart with so much stuff senate and:00 p.m. the card went on line is she could not process because she had $700 worth but only $0.49 on the card. they were littered with people abandoned them because they would be caught adam: but they will know who's spent a and got out of the store? >> absolutely. that is the point is we can
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track back to those individuals but the bigger story is social media played a huge factor. and we can debate the effects of the welfare state or whether not the cards are a smart idea but i guess not >> you brought up the interesting point of social media they either have a mobile phone device or a computer but that points out the standard of living. >> because now they aren't twitter in to your point of view creates a flash mob because people say guess what? there is no limit so take advantage now you have a flash mob taking advantage. >> the bigger story is creance the to be aware of social media at a higher level that somebody said
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fiasco in in the process of the realizing everybody would tweet and facebook that is a huge problem. we could have gotten ahead of this. adam: i would not have thought of the social media. [laughter] facing your worst enemy has never paid so well. you can never have too much money. ♪ my mantra?
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cuscustomer's not happy, ordi'm not happy.'t fit.line sales go down, i'm not happy. merch comes back, i'm not happy. use ups. they make returns easy. unhappy customer cthen, repeat customer. easy returns, i'm happy. repeat customers, i'm happy. sales go up, i'm happy. i ordered another pair. i'm happy. (both) i'm happy. i'm happy. happy. happy. happy. happy. happy hay. i love logistics. streeters main street everybody on netflix reportedly in talks with major cable providers to make it possible and sony would be the first major studio to produce a show for netflix. it sent the stock soaring by
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8 percent. do the math making $24 million that it's a nice way to start the week. the walking dead the fourth season premiere bryce 60 million viewers a new record it also the highest rated show in all of television with people between the ages of 18 and 49. to all-time records that were broken revenue climbing get 2.1 billion dollars and despite the big service disruptions from superstorm sandy last year. it breaks down when i am on it. we hope you have a good day melissa will be back tomorrow with a special interview with martha stewart. tune in the willis report is next.
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gerri: to night on "the willis report." tens of millions of americans rely and social security are in for a shock to raise will not even by half a tank of gas. a new way to save u.s. postal service now say it is time for the ipo inducer way to get the cash from the atm with no card. we are watching out for you. tonight to. gerri: we're starting with the latest o

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