dagen: burned by the wolf of wall street, charlie gasparino insouciance with one of the 1500 victims. first, our top story, nicole petallides on the floor of the new york stock exchange. the dow on track for third straight day of losses. nicole: down 200 points. you're seeing selling across the board. all three major averages at any given point were down over one full percentage point. the nasdaq down .9%, s&p 500 down 18 points, a loss of a full point. the dow down 180 points. most of the names of the dow jones industrial have down arrows. some telecom names are squeezing out gains. primary influence was china this morning. they really echoed that sentiment. what we saw from china was a contraction in manufacturing. below 50, that reading.

that doesn't show good news for the economy and the like. the fear index has been to the upside, you have seen that and investments to protect against this type of global economy or global action. and then you start to see gold, for example, gaining throughout the day. the 10-year treasury bond, the yield has been falling throughout the day. now 2.87%. back to you. dagen: thank you, nicole be at >> the company is getting hammered on new calls for an investigation. a democrat from massachusetts sent a letter to the fec and ftc asking those agencies to look into the companies business practices. he is making that request because he says some of his constituents have lost thousands of dollars after they signed up to become herbalife distributors. the most prominent lawmaker so far to call for action against herbalife, and it comes more

than a year after activist investor bill ackman first called herbalife a pyramid scheme. herbalife is responding telling fox business "we look forward to an opportunity to introduce the company to him and address his concerns at his earliest convenience." tracy: activist investor striking again. this time carl icahn is striking for ebay. he is now urging it to break off his powerful paypal unit. what could this mean for you especially if you own shares of ebay? robert peck is back with us and says there is no downside to this. welcome. >> thank you for having me. tracy: why do you say no downside? >> they're looking at a true asset values of the dispersed assets. fine-tuning their pencil little bit. a lot of times they will do a generic p/e on the overall company. when you break the company apart, there's a lot of upside. you may not need a full spin of the company. you could do a partial spin like

vmware. take 20% spin out. >> see you are not necessarily saying whether or not paypal is a good or a bad thing but it will highlight th value of the overall company. having said that, do you think paypal is currently undervalued? >> we do. we think the company is undervalued. $65 target. generating $3.4 $3.40 of earnin. adding in the cache, asset value, et cetera. you get mid-60s a couple of different ways. tracy: ebay may not think it is properly valued, after all it lowered thousand 15 guidance, but is that about keeping the bar where ebay wants the bar to be so doesn't disappoint? >> it was a fantastic move by the company. the number one move we had was people thought they would lower their guidance but not by enough. the fact that took guidance out for $3.80 midpoint to $3.40,

gives and i guidance to beat the race. >> talk about the valuation of ebay and how it stacks up against major competitors, mainly amazon.com. >> right now it is much cheaper. and that is about 40 times plus. it is more of a value story brick net investors right now. they key to understanding the story is a various assets, valuing them separately and aggregating as a whole. >> is this one fundamental to keep an eye on what happens with paypal? what else is going on with the company? expanding the shopping experience so you are not just doing auctions, you're using it as a shopping mall. what is going on with the shopping strategy? speak out it has been very successful they provide almost a shopping mall experience. able to sell their merchandise in a very high-end way. very successful over there, expanding the efforts in the u.s. i think the big risks are going

to be at the end of the year can paypal fight the competition coming. square, stride, some of these younger players and can ebay marketplace grow faster than e-commerce? >> robert peck, thank you for your insights. >> thanks be at ashley: oil prices clim climbing to the higt level in three weeks. phil flynn in the trading pits of the cme. the numbers are bullish for crude, anything else pushing prices up? >phil: i think the cold weather. there is still inventories much more than expected down 3.2 million barrels. we also saw propane supplies falling as well. so those are the two major markets that have been running. we also saw a drop in refinery runs. and that made the crude even more bullish because the question is why don't we see crude oil supplies go up even more. so that was a little bit of a

surprise, very, very bullish. the one confusing thing is the production of gasoline actually rose while distill production fell did interesting to see this. seeing gasoline prices fall, heating oil rise. cold weather will keep the demand strong for that is where we are going to be looking for for the rest of the day. ashley: phil flynn, thank you very much. >> breakin braking is a governmt surveillance program. the surveillance born in charge of reviewing the findings. details on this. >> u.s. should stop collecting bulk phone data because it is illegal. calling obama's reform insufficient. in the final report of the program, private see and oversight board says the program lacks a viable legal foundation raising serious threats to privacy and civil liberties on the privacy matter. for this reason the government should end the program adding we

have not identified a single instance involving a threat to the united states in which the telephone records program made a concrete difference in the outcome of a counterterrorism investigation. in response, house intelligence commission roger says the board decided to step well beyond their policy and oversight role and conducted a legal review of a program that has been thoroughly reviewed. he says 17 federal judges have found the program is legal. the man responsible for reviewing all of this, edward snowden, will reportedly answer questions on line at o'clock this afternoon. back to you. tracy: thank you. ashley: lenovo agreeing to a historic deal, but could a u.s. security review get in the way of that deal. jo ling kent here with the latest details. >> it is very possible. acquiring ibm low-end business service. the largest tech purchase by chinese company, but will the deal actually go through? the deal must first be approved by regulators who sit on the

committee for foreign investments in the u.s. led by treasury secretary jack lew with representation from the department of state, homeland security defense, energy and many more. bonobo has had good luck in the past, 2005 acquisition of the pc business was approved after much scrutiny, but most recently companies have failed. attempt to buy three com was rejected. look at the numbers, scrutiny of chinese investment in the u.s. is going up. conducted 20% of chinese companies, china unseated the uk at the number one spot with 23 companies followed by the uk, canada and japan. the low-end server business from ibm selling to lenovo linking computers and networks, government agencies and companies that agencies want to keep secure.

last year opted to investigate the smithfield pork deal which to me signals they could very likely go through the same process here with ibm and lenovo. tracy: this unbelievable scene out of the ukraine. the question now, can police and protesters reach a compromise after demonstrations are now deadly. ashley: liz claman in davos for day two of the world economic forum. her interview with the ceo about a possible spinoff of that company. tracy: it is a cf. red. netflix is a standout winner. ♪

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greg. >> serious stuff. we in fact have just passed about 13 minutes ago the deadline which had been set by the opposition for the government to act on its demand. if they did not act on their demand, a wood stage and offensive, they would stage an action against the police come against the authorities. so far we haven't heard anything from either side. this comes after some of the most serious violence we have seen that country for the past couple of months since the protests started. 70 were arrested, 150 police running street battles in the capital of ukraine between the police and protesters, devastated hurling rocks, molotov cocktails. the authorities allegedly using live ammunition. as you noted, atrios put in place so the opposition leaders could speak ukrainian president. they want base of the government to step down.

they want a new election, they want the tough anti-protest loss put in place the last couple of days repealed. there hasn't been too much budging on the government side. they have, as you noted, called for a parliament session next week, and calling the protest nothing short of a coup d'état. they're watching this very closely. ukraine on the front line. it was a rejected trade pact between the eu and ukraine back in november which kicked off all of these protests, also fueled by the perception russia and its president vladimir putin had strong-armed ukrainian government to go off with the russian side. again, no wonder what washington is watching this all very closely. we've just gotten word from the spokesperson for the white house, jay carney. he is actually saying washington is considering sanctions against

the ukrainian government because of their actions against protesters, and saying those protesters are expressing their genuine grievances and should have the right to speak out. obviously a very tricky situation and we could see some developments in the next couple of hours. back to you. lori: a tricky situation but brilliant explanation of what is going on there. ashley: our eyes focusing back on wall street. earnings an in focus because ofa selloff. nicole petallides of a floor of the new york stock exchange. the dow is near the lows of the day. is it not? >> that is right. moments ago hit the lows of the day. so right now the low of the day would be 16,171. down on the dow jones industrials. everything from the drug index, retail index, bank index, well services, all to the downside. only the safe haven seem to be

doing well such as gold. telecom seems to be holding up nicely, those are some of the areas seeing a glimpse of hope. manufacturing really put a damper on the market today. let's get to netflix. a top story today. this is an all-time record high today for netflix. up 16%. they added more subscribers in the u.s., worldwide totals of 44.4 million. golden globe nominations, original programming and continues to do well. back to you. adam: thank you, nicole. lori: fox business is learning twitter has signed a lease for major office space. here in new york city. the social media giant isn't moving headquarters from san francisco, but this is a big coup for the big apple as twitter expands. adam: fear over china's dragging down the market.

charles payne is here now as the dow is down roughly 200 points. charles: i find it amazing. we have watched the market since the year began. it has been sort of obvious the market wanted to sort of pull back, but the idea this china news would be the one that sort of released a trap door, if you will, it is sort of shocking because china continues to mean so much to our economy, even as for the most part we say all the data, out of their is made up, not real. there are days like today we wished if you are going to make it up, make it up better than you did. the number pmi at 49.6. the audience should know anything below 50 is contraction. the manufacturing parties contracting, down from december and below with the street had been expecting. contrast that to what is going on in europe because the pmi numbers from the euro zone and the key economies there. absolutely phenomenal. the euros on 53.2.

the highest and 31 months. germany the highest in three months. even france contraction 48.5 still at a three month high. it goes to show you at europe seems to be coming out of it, a serious seems to working out, we are so, so vulnerable, type two is happening in china. adam: europe is more tied to china, aren't they? charles: it feels like from a growth perspective and influential perspective. the proof is in the pudding. china output last year 7.7% matches the low from 1999. imagine if we grew at 7.7%. lori: we would take it at a heartbeat. charles: they hiked their estimate for china, they face their estimate the global output, these sort of hiccups playing a big role. i find it fascinating we are so tied to china and economic development.

when guam misses their numbers, we don't go down. lori: there are fewer people in guam. burned by the wolf of wall street, a real-life victim sharing his stories. telling charlie gasparino what the penny stocks scammer was really like. adam: and liz claman in davos for day two. liz:'s next and wonder if it is as fast as everything seems, what was davos like 20 years ago. marking his 20th year at the world economic forum, chairman and ceo of cantor fitzgerald, will be joining us to talk about davos then, davos now, and what matters most to him. [ male announcer ] e new new york is open.

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adam: world economic forum is in full swing in davos, switzerland. in the last hour, liz claman spoke with the chairman on the importance of business is going digital. liz: there is almost no business that can escape the need to get

up front and bring into the business. you have business is based almost completely on the digital formula, if you will. every physical business, every distribution you can talk about universities, government, whatever, has to bring the digital aspect in here. lori: there are business leaders who never get invited, and there are those who landed the coveted invitation year after year. howard lutnick of cantor fitzgerald' is marking his 20th return to davos. liz claman caught up with the message arrived arrived for his 20th annual trip to the snowy swiss town. liz: so how do you get an invite to davos? you have to be a business titan, a real industry leader, or a global leader. one could argue howard lutnick of cantor fitzgerald is all three. this is your 20th davos.

how has this changed? i thought 20 years ago would be a much smaller affair. >> the first time you come, felt a little loss. i walked around, bumped into things. you are very much sort of missing out on things because you didn't know. now after 20 years it is sort of like my high school reunion we had i know everyone, we are sort of old friends again even though i have not seen them in a year. liz: is it fair to say you made deals that matter to cantor fitzgerald for the seeds were planted here in davos? >> absolutely. my real estate business, i met the executive in new york, but every year we would be here and spend some time together. have dinner together, lunch together, eventually we became really good friends and we bought his company, and the rest of it had been a relationship together between the two of us

building a real estate business. the real estate business started from the relationships. liz: that articulates the value of davos. how do you expect that to perform in 2014? >> low interest rates and sort of slow, steady growth are the perfect ingredients for real estate. real estate is looking , low interest rates, which we will have for quite some time, low, steady growth, a couple%, really spectacular. liz: you don't see tapering juicing interest rates higher at all? >> tapering is the world's easiest monetary policy. and then what else do we do? paper. we will buy bonds. why do we buy bonds? hard enough nothing is happening, so if we stop buying our own bonds, why are we buying our own bonds? leave it out. stop buying our own bonds we will end up with the easiest

monetary policy we have ever had. the fed will say when they're done tapering and done buying our own bonds, they will see interest rates will be zero or half a percent. what is a half a percent? you can buy coffee with the interest rate on half a percent. liz: what looks good to you as an investment, howard? >> with low interest rates, certain asset classes perform unbelievably well. that is my real estate will continue to perform well because it is a low industry rate-based environment. equities. you have to still like equities. the returns you are going to get. i can't really put in bond in 2% or 1% because i'm afraid interest rates are going to rise. have to like stocks, have to like anything that rises with the value, so commodity, commodities our economy base.

so you see canada, the loonie is going down, down, because it is just a commodity-based trade. commodities need economic growth, which we don't have. liz: since your first davos 20 years ago you've either bought or started some 100 businesses. are you still on that track? >> i am. what happens is one thing we do well, we like to help people find each other. anyway you can do that. i described my businesses as a narrow hallway with a low ceiling, thank god it is really, really long as we can keep doing really interesting and different things. our real estate business has grown gangbusters, stock is up like 89% last year because the real estate business is a spectacular business. we still pay huge dividends because we're in the brokerage business. i don't have to use my capitals we pay 7.5% dividend, almost a billion dollars in cash and a stock going up and up and up. liz: one of the businesses you started, it was cantor gaming.

where does that stand? >> we fortunately resolve things with nevada regulators, so that is behind us. i think the name of the company is now cg technologies getting ready for intention to go public. liz: that is news. what about cantor fitzgerald? >> eventually my guess is cantor fitzgerald will go public but this low interest rate, how much do yo talk about don't we love banking. nobody is talking about that now. that is not really the business to go public. we have a company that is a first mortgage lender. you have a small building and he wants to borrow money for it, we will lend you 70% of that mortgage and package them together and sell them to institutional clients and that company has them on file and it will go public, it is likely to go public in 2014. liz: you are an ipo machine.

thank you very much. howard lutnick of cantor fitzgerald and bgc. back to the studio. adam: thank you. coming up next hour, liz gets education in davos that you don't want to miss. 2:30 p.m. eastern time. next, the startup helping regular people lend money to one another. lending club ceo how this works, the rates that are enticing for borrowers and lenders, and how you can get in on it. lori: later, the smart phone apps exploding, helping users real in the big fish.

adam: the dow is trading at the lows of the day. a lot of this has to be

attributed, one, there was a jump in the vix and we also saw a bad pmi reading out of china. lori: amazing how that is having a ripple effect in the markets. off 200 points, just off the worst levels. u.s. home sales rose slightly in december. sales rose 1% in month of december after three consecutive months of decline. that's according to the national association of realtors. home sales totaled last year to 5 million units. that is the highest number in record years. record low mortgage rates ahn increased demand continue to help the housing recovery. adam: you need to borrow money forget the bank. peer-to-peer lending. we have a lending shrub ceo to discuss boom and borrowing in lending lending that is scaring some big banks. thank you for being here and congratulations for what is a booming business for you.

if i'm a borrower, how does this work if i want to borrow some money. >> hi, adam. lending club is marketplace where we borrowers on one side and investors on the other side. borrowers apply for a loan to give information about themselves. we check their credit. we check a few things about their ability to repay the loan and based on that information we can either decline or accept their request and price the loans. then the loan request is made available for investors who may make their own decision whether they would like to invest in that particular loan or different types of loans. adam: so it is anywhere from $1,000 to $35,000 for the borrower. assuming. borrower meets the credit standards, how do you then price it, what is the interest rate the borrower might pay and how do you get the investors? because the investors you have to have a group of investors all willing to lend a total amount,

otherwise no deal for anybody? >> that's right supply and demand like any other marketplace. borrowers are people with good credit, stable income and who come to us pay off existing credit. so many consumers have credit cards balances outstanding and the rates, interest rates on credit cards are so high, generally in the 16 to 18% it makes sense for consumers with good credit to pay off their credit card and refinance at a lower interest rate generally for lending club, for 36-month loan. the rates are about 12.5%. adam: okay. >> which unsecured credit is a good deal for borrowers. it is a fixed-rate. so borrowers know exactly what to expect and monthly payment that is are exactly same monthly payment every month. so it is very, easy to budget for from the borrower's standpoint. adam: from investor standpoint, are they getting that 12.5%?

you make money from the fees. so then that 12.5 would go to the investors, is that right? >> that's right. we charge fees to borrowers and investors on both sides. investors get 12.5% minus any credit default. if borrowers default on the debt every year as a percentage so investors would earn the net amount after default. so on average investors have earned, depending on between five and 9% annual return after default every year since we started w this low rate environment, it has been a really good, really good investment for investors. adam: very good of a return. we should point out you're regulated through, you have partnership with an actual fdic bank but the money that an investor puts in is not fdic protected. it is not a deposit so you could

potentially lose your investment but you have to adhere as the same regulations as a bank in lendings correct? i'm curious why the big banks afraid of you? wells fargo prohibits any of their employees to invest personal money with you. >> investors make a investment. it is not deposit or fdi insure. they can lose money if the investment doesn't perform. it is important for investors understand the risks and reward attached to the investment. we invite investors to diversify as possible. so any default doesn't have a big impact on their portfolio but, generally i think the reason why it becomes better for borrowers and investors, it is generally a better deal than what the banks and credit card companies can offer just because we operate as a marketplace. we're fully online as well. we have lower cost structure than the banks. in terms of regulations it's, the investors side is regulated

by the sec. so it is a public offering of notes. we just registered with the sec and on the borrower side we apply and subject to all the banking regulation in terms of truth in lending, in terms of equal credit opportunity. in terms of fair credit. adam: all right. we appreciate you're sharing this with us. it is lending club for people that might want to borrow or invest. thank you for joining us. >> thank you. lori: howling all the way to the bank, oscar-nominated "wolf of wall street" raking it in to the box office but try tell that to the targets of the wolf's evil ways. adam: charlie gasparino is up next with a victim of jordan belfort's penny stock scandal. ♪ [ me announcer ] this is the story

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dozens of tax free zones all across the state. move here, expand here, or start a new business here and pay no taxes for ten years... we're new york. if there's something that creates more jobs, and ows more businesses... we're open to it. start a tax-free business at startup-ny.com. >> i'm david asman with your fox business brief. the white house says that the president's 2015 budget will be released on march 4th. this is the second year the budget is going to be late. under budget law it should be delivered the first week of february. last year's budget went to congress even later, april 10th, 2013. neiman marcus says 1.1 million credit cards may have been compromised in last year's breach. they stole credit card and debit

data. social security numbers and birth dates they say were not taken. toyota remains the top selling automaker for the second year in a row. they sold 90 boiling 8 million cars worldwide last year, beating gm by 200,000 vehicles. that's the very latest from the fox business network, giving you the power to prosper.

adam: thousands of people started to flock to movie theaters on christmas to see martin scorsese's latest movie, "the wolf of wall street" but watching that movie was a lot different for our next guest. charlie gasparino is here with an exclusive interview with robert shearin, one of the victims of jordan belfort's penny stock scam. >> how are you? >> i'm doing well, thanks. >> how did you get on belfort's radar screen? were you on his screen in

particular or one of his brokers? >> it was one of his brokers, paul greco. i was sitting in my office, in my garment business, trying to work hard to get it built up. paul greco called and said i made a lot of money for one of your classmates at business school. he told me to give you a call because you were a player and wanted to make money in wall street. >> how did he get your money and all that? was it all out of a phone book and all that. >> i'm assuming he may havehe bl and found my name and kind of assumed with anybody that went to the school, i happened to go to harvard business school, so i feel even more of a fool for falling for their scams. >> you were hardly alone. did he actually go to one of your classmates, was that part accurate? >> i must admit i did not bother to follow up with one of my

classmates. i just assumed, well, if he made x-money, let's see if he can make me some money. >> did he ever make you any money. >> he let me make money on the first couple of deals, whiching sets the hook and then i was ready to go in with force. >> how much would you say force would be in terms of dollars? >> let's say that my attorney negotiated a six figure settlement. of course which i have seen in the very low five figures. so it was somewhere around 150, 150,000. >> i gotcha. you saw the movie, "the wolf of wall street" i'm assuming? >> i did. >> what did you think? >> i thought it was an amusing, roll i canning romp that left out a lot of important details about what stratton oakmont was about. but my attitude if you want to know about stratton oakmont,

don't go to a movie. like going to see "jfk" to learn about the kennedy assassination. >> i done a lot of reporting on them. i done a lot of work over the years. i haven't seen. movie. from what i gather from the press, sound like there is celebration going on what jordan belfort is. one of the reasons we're bringing you in on, show you may celebrate his antics, you may celebrate his partying and hanging out with women and what a great deal that was but then there are victims like yourself that got short-shrift in this movie. i'm assuming there was almost no mention of people like you in this movie, correct? >> yeah, there really wasn't. i thought that was the most glaring omission. they create this mythological figure buttamerica loves its scoundrels, whether "goodfellas" or "the sopranos" or wall street. so, so as they're making this mythological figure it is easy to forget that real people lost real money to the tune of

$220 million. >> right. which they paid just a fraction of it back, as you know. >> a small fraction. >> right. >> and belfort likes to claim that he only went after rich people. that no one was killed. that people didn't have to buy. but he is a thief. >> you weren't quite warren buffett type rich. you were a small business owner. you were a guy that was smart. you went to harvard business school. you had a few bucks. you were not living high on the hog. you were a guy that made money. you had a business. you were not rich beyond belief, where it mattered to you how much money he stole from you? >> absolutely. it put a hole in my pocket at a time i was trying to build my business. now luckily, i succeeded well enough that i could take the hit, move on and learn a lesson. but i am told by my attorney there were people who were devastated. >> right. >> one person i told about hocked his whole ranch to go in and lost his ranch and later

committed suicide. there were real victims out of this. >> we agree there were victims. let's end on a note to try to prevent this from happening again. you got a cold call from somebody. did you ever meet the broker. >> no. >> you got a cold call. i assume he gave awe deal too good to be true, in the mid 1990s, correct. >> early '90s. >> when the markets were starting to get up. did you fail the test yourself? i know you're a victim, not casting any aspersions but you yourself kind of put your foot in it, didn't you? >> i absolutely agree with that. that's one of the lessons learned is that do your own due diligence. certainly it is easier today than it was 20 some years ago because you have got the internet and you have got ways to quickly find out information but, no, i was a victim of his scam combined with my hope to make a quick score.

so i certainly take on responsibility. >> so there's no quick scores on wall street, generally, correct? >> correct. if it sounds too good to be true it probably is. >> like to end it there. thank you, mr. shearin, good luck with whatever you're doing in the future. >> all right. i appreciate it. adam: thank you, charlie gasparino. lori: gone fishing with the help of your smartphone? well our jeff flock putting a new app to the test in a very cold wisconsin. [ male announcer ] here's a question for you:

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adam: we want to let you know, that we haven't seen intraday losses like this at least for five months. the dow is down 223 points. all major indices are down 1%. we'll have more on "markets now." lori: placing a bet on the super bowl, are you? let the unemployment pick the winner a new report from management solutions company, rise smart, revealing the city with the lowest unemployment rate from the previous calendar year won 20 of the previous 25 super bowls. if the tradition continues looks like the 12th man will put the seahawks on top through november of last year, the seattle area had a 5.9% unemployment rate. denver sat at 6.7%. worth noting both cities are better than the national average. adam: the smartphone application economy has more than $5 billion in 2012. it is expected to expand over 140 billion in 2016. new apps continue to be developed to fit all kind of things. jeff block is live on lake helen

in wisconsin with a new innovative app that is hoping to catch people's attention. jeff? >> walking on water as we speak. lori, i hope you don't mind, itch got the fur back on today. just as well. it is minus 2. whoa, i almost went in the water. that is something called blue trips. this i willlous streets what the app economy is doing right now. brad developed this app. it does what, brad? >> it basically transmits a wireless signal back to the smartphone, fishing out of your snack, and you don't constantly staring at tip up and the light comes on the blue trip. >> tip-up for those that don't ice fish is something that holds your line and tells you if you have something on the line. the ceo of cisco, john chambers, talked to liz earlier today and he said, hey, listen, apps are the future. the app economy, you put the numbers up there.

$53 billion right now, 143 billion by 2016. and i'll tell you, what am i looking at here by the way. ryan. this is just another tip, up, we have. thermal tip-up allows the hole not to freeze over as fast. we're checking our lines to make sure our minnows is lively and kicking. this one is. >> pull a minnow up there. there you go. that guy is still alive. he is happier to be up here where it is warm, don't i think? look at apple and google stock, in terms of apps and android and ios devices. we'll put up numbers next hour on that, talk more about, wouldn't you say, this would be the one bastion where technology and apps would not be found on a frozen lake but we're walking on water here and so are the apps these days. adam: jeff, i suspect it is fun but wouldn't it be easier to go to the jewel osco to buy fish there?

a lot warmer. >> come on, now. come on, man. lori: that is great assinment today. >> lori has ice fished. didn't you ice fish in alaska? lori: i did, jeff, thank you for remind everybody about that. miss those days. love the fur. always teasing you. are banks to blame for the u.s. falling behind europe and asia in implementing better hack-proof credit cards? we have investigating reporting on this in the next hack-proof hour of "markets now." don't miss it. ♪ ♪ ♪ [ tires screech ] chewley's finds itself in a sticky situation today

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tracy: hey, good afternoon, i'm tracy byrnes. ashley: and i'm ashley webster. selloff. the dow is down big-time on china lackluster numbers and fears of slowdown in the housing

market. tracy: are banks to blame falling behind on implementing better hack-proof credit cards? your tweets ahead along with our big investigation. ashley: how do you feel about edward snowden now? an independent board calling for end to the nsa data sweeps which snowden helped to make public. tracy: this is cool, wearable tech. from monitors to make your baby safe to a temporary tattoo that senses vital signs. we have the latest devices. cool chic thing to wear. ashley: netflix, shares of new highs, as subscriber growth, subscriber growth, as well as cyber keeps on growing. dennis kneale on the bright future, so much more on the streaming hour of "markets now." tracy: are we streaming? ashley: we should be. tracy: top of the hour. it is time for stocks. go to nicole petallides on the floor of the new york stock exchange. you're watching a serious selloff, nicole. what is going on? >> i am indeed. markets reacting to numbers from china pertaining to manufacturing which showed

contraction on the level of the pmi was below 50 as opposed to above 50. above 50 would be good news. below 50 would be bad news shows contraction in manufacturing. that would have a ripple effect. we saw selling in asia. then selling in the states. we had heavier trading in the morning once europe closed. we continued to see a selloff here. we're at session lows. the low of the day is 16,140. we're just about there. 229 points to the downside, a loss of almost 1 1/2%. financials lead the way to the downside with likes of morgan stanley, jpmorgan, even fifth third, zion bank which are losers on the s&p 500. quick look here at mcdonald's which came out with its numbers, its global same-store sales, were a disappointment. u.s. sales were a disappointment. the stock is bouncing back and squeezing out a gain, up a quarter of 1%. one thing they plan to improve current initiatives in the u.s.

and focusing on menu choices as well as customer engagement. back to you. ashley: customer engage mane indeed. thank you very much, nicole. appreciate it. existing home sales rising 1% in december. that snaps three straight months of decline and overall existing home sales up 9% in 2013 compared to the year before, but, as home values rise zillow's chief economist stan humphries expect local real estate markets may see confusion and uncertainty among homebuyers and sellers. stan joins me now. why the confusion? why do you think that is the case? >> think better peck spif of being consumer in markets like phoenix that was down 50, 55% from its peak in 2011 and now 30%. it has been a real roller coaster for them. in 2014 we'll see a lot more markets become more varied. nationally we'll expect moderate growth and moderation actually but local markets are seeing

widely varying home value performance. san francisco seeing 10 to 12% and other cities flat. ashley: because these markets fell so precipitously when the bubble burst and now they have come back. we have investors that have come in and so there is volatility in these particular markets. >> the markets done best are the one that is were hit hardest during the housing recession. you created a lots of negative equity which constrained inventory. once buyers earned to the market with particularly low mortgage rates. you have more buyers and versus sellers, southern california, vegas, some of the florida markets. so i know it is region then and city-specific overall but the housing market is recovering. seems at times we're doing one step forward, two back. >> it is, 2014 is certainly a mixed buyer, or mixed bag particularly for buyers where they will see challenging affordability picture. we expect mortgage rates to rise and home prices risen past

couple years. on the other hand they find fewer investors and more inventory. more new construction builds and people seek to sell the homes. affordability is more challenging in 2013 panned 2014 there is more choice in 2014 and they will not have to compete as much with investors as they did in 2012. ashley: how difficult is it to get a mortgage these days? >> lending standards are dramatically tighter than 2006. they were too loose in 2006. ashley: yeah. >> over the long-term perspective they're fairly tight. back-to-back, look more like early 1990 standards. i think we'll see a real loosening of standards, some loosening of standards in 2014. as rates rise banks will have to get more creative with the credit box in order to keep business up. they will get creative by lowering down payment requirements and maybe taking people with lower credit scores. >> i noticed that even in the latest numbers, the a third of

purchases were all-cash buyers. still a remarkable number to me. are the investors out of the market bought up all the bargains or are they still there. >> real shift where investors are. early days they were heavily in southern california, phoenix and vegas. they largely decamped from those areas and moved to places like atlanta and chicago. overall investing particularly by institutional buyers is starting to slow a little bit as home prices come up and returns they make on rental properties, buying distressed properties and converting them into rentals is less and harder to find distressed inventory now because foreclosure rates are falling so fast. ashley: is it buyers or sellers market right now. >> 2013 was strongly a sellers market. 2014 will look more balanced. a negotiating power would pull back more to the buyer's said almost in balance in 2014. ashley: stan humphries, thanks so much. tracy: we have a news alert for you. edward snowden ratted out the

nsa broad data gathering program. now an independent panel is calling for an end to the spy agency's massive spying program. they say it raises constitutional concerns about citizens right of speech, new york republican peter king defends the nsa. >> what i've seen, i stand by its effectiveness. cases it has been very effective in. i don't know where else we would go to find this information. if we do go terrorists phone number overseas how will we track that into the u.s. if we don't have the repository of numbers? tracy: the independent panel calls for the nsa to purge its files. let's talk more about stuff like this. the big question, are banks to blame for the u.s. falling behind in europe and asia in implementing better hack-proof credit cards. tweets at bottom of the screen. foxbusiness.com's kate rogers joins with investigative reporting on all this. ash and i talked about this

before. europe is so far ahead of us, aren't they. >> they use emv cards. euro paymaster card visa. they're chipped encoded cards rather than the card we use in the u.s. with a magnetic stripe. they're considered more hack-proof. after the fallout of the massive breach at target affecting 70 million people, we know neiman marcus's breach affected 1.1 million people, more consumers are saying why don't we have more of these in the u.s.? tracy: magnetic strip is easier to get into? >> and to create counterfeit cards for fraudsters. tracy: are they quick to do this? we were talking in the green room, my second byline of all time, second i wrote i'm embarassed to say in 1997 was about smart chips and smart cards coming to the united states. that was '97. i can't even find the story because they didn't put magazines on the web. >> people are asking why they are not here in the u.s. we're waiting and waiting for it to happen much one of the reasons

it hasn't happened here analysts say it is cost. it would cost 5.$6 billion for all merchants in the u.s. to put terminals in the stores to accept accept these kind of cards. one of the other reasons there is no industry set guideline saying this is d-day, when the cards need to come to the u.s. tracy: cost of being hacked is clearly outweighs the cost of term has, right? >> you would think so. target's ceo called for a change in the system. he thinks they are ready to adopt the card and industry is ready for it. huge retailer wouldn't hurt too much financially from implementing terminals and small merchants would be hit hardest. something to consider. one interesting thing, visa is the forefront pushing for this to happen. they say come 2015 merchant banks will now be responsible to bear the burden if some type of financial fraud does occur. tracy: you got a letter from your bank recently. >> yes, i did. i got a letter pro my bank chase. i happened to shop at target,

from nerve 27th, black friday weekend. went at some point. so they are replacing my card. i haven't had any data compromised, thank goodness. fallout is still continuing. they're still replacing cards. really much bigger than anticipated. >> they have to get on this. thankthank you for staying on t. kate rogers, great stuff. ashley: all it is a little chip. using them for years in europe. oh, yeah, it is coming guaranty you as kate said. airline earnings soaring but shares not taking flight. nicole runs them down from the floor of the nyse straight ahead. tracy: call this one not fund. ahead in tech minute we'll tell you why internet dress suffixes like dot-com, dot-net may be joined by others maybe even dot-ashley. ashley: can you imagine? how about dot-god? why the pope thinks the internet is a gift from above. tracy: no comment. no comment. every day at this time we look how oil is trading. up a buck. dow is down 214 points.

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tracyy time to make money in this down market with charles payne. or at least don't want to you

lose anymore of it. the dow is down over 200 points. should you buy, sell or hold? keep your stocks in your portfolio? what do you do, charles payne is here. >> i'm not buying. getting a lot of emails. tracy: you're not? should be shopping on a day like today. >> not every dip, guys. what i want to talk about how do we make that determination. ashley: right, exactly. >> so what i have put together are the key downside support points for the markets, for the major indices. first one i'm using for all of them are the 50-day moving average. i use what is known as exponential moving average which puts onus on recent trading activity. what is interesting for the dow, 50-day moving average is 1640. we're almost right there. ashley: yeah. >> s&p would be 1808. nasdaq would be 4077. those are my key numbers, if that doesn't hold we should see more pressure to the downside. ashley: okay. >> that takes us to what i call

must-hold support points. s&p would be 1750. dow jones would be 15,739. december 5th tenet, day before they announced tapering. nasdaq, 4,000. those are the magic numbers. those numbers hold, we start to come back you have your list already prepared and then you start to go shopping. so right now just sort of no-man's land. ashley: is it just about china and weak pmi here. >> without a doubt china kicked it off. we take a broader perspective. up 10,000 points in five years. 30% last year. you know what? 840 days without a 10% correction, i mean you talk about pullback being due, this kind of move is sort of scary in a sense we're so tied to china. a lost dissatisfaction with earnings. huge preannouncement, negative preannouncements coming into the top line is what is bothering people. those top line numbers -- tracy: there has been no top line for how many quarters now? >> i know.

every time we go through one of these things there is still no top line, that yellow flag become as red flag. there are people who are concerned about fed tapering. a whole bunch of things are pushing us down. we put into perspective. pull a one-year chart, five years. okay, maybe we're just being a little unreasonable. by the way, i don't mind taking the big hits all at once. i prefer this over sort of a water torture kind of thing. down 30, down 30. except it does get scary, when you put a couple of these bad boys back-to-back, it does get scary. tracy: thank you very much. charles. ashley: thank you, charles. it is quarter past the hour. time to get a check on these markets. nicole petallides down at new york stock exchange. lots of airline earnings today, nicole. >> right, we're seeing airlines which have done so well over last 52 weeks. wasn't long ago we heard from delta. we'll hear pro a few more. southwest airlines, united continental and alaska and what

we saw today are some new highs. alaska airlines hit a new high and so did southwest airlines hit a new high, annual highs. they since pulled back. southwest is down 3%. united continental is down half a percent. over 52 weeks it is up nearly 100%. i wasn't kidding when i said this group was running hot. with we have seen a theme throughout the airlines and latest earnings which is low fuel costs, higher passenger revenue, higher fares that have helped them ray long. united continental said first quarter revenue would be light. that doesn't sound so great but overall the group has done very well. back to you. ashley: they have. nicole, thank you so much. tracy: all right. remember that infamous lufthansa heist that response inspired the movie "goodfellas"? ahead in fox news minute we'll tell but an arrest 35 years later. ashley: are you looking at me? there is app for that.

yes, i said ice first quartering app. jeff flock is hooking us up. jeff? >> i sure am. you see we're augerring right through the ice here. i will show you something that augers well for the app economy. are you through there yet? whoa! stay tuneds we'll be back in a second. [ male announcer ] here's a question for you:

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the hour. i'm jamie colby. this is your fox news minute. violence continues to spread throughout the ukraine. opposition leaders giving the president 24 hours to ease the political crisis or face more unrest. the country's prime minister declaring the ultimatum unconstitutional. at least two demonstrators have been killed in recent clashes. at this hour there are mounting concerns over terror threats to the 2014 games in sochi. now some u.s. olympians are telling their families, stay home. just yesterday the u.s. and european nations received email warnings of potential terror attacks but the international olympic committee calling those emails, not credible. there is big break in the legendary 1978 lufthansa heist at jfk airport.

remember this one made famous by the mob movie, "goodfellas"? five alleged mobsters go before a judge on a slew charges, some linked to the robbery. the perpetrators made off with $6 million in cash and jewelry. one of them seen here, vincent asaro the suspected mastermind behind the caper. those are latest headlines. back to ashley and tracy. don't do that kind of crime often here. back to you guys. tracy: jamie colby. thank you very much. there is an app for that! jeff flock is live on lake helen in wisconsin with a new innovative app that is catching people's attention. jeff? >> you know, we wanted to pick a venue that would demonstrate just how far the app economy has come. this is what a ice auger does. goes through the hole and put as hole in the ice and put your fishing line down. i have two brothers with me here. that's ryan. this is brad. and you have invented something

which takes ice fishing to the whole 21st century. >> yes. so into the traditional tip-up we incorporated an alert which actually it's a light when the tip-up flips up but also sends a wireless signal to your smartphone. >> i will explain what the hell he is talking about. first i want to putnam members up on free versus paid apps. this is free app by the way but there is device attached to it, something called blue tips this. is what sends the alert to your phone when there's a fish on there. pull it up so people can see what ice fishing looks like. >> here we go. we pull the tip up. basically there's a spool below. if we pull up the line we can see that there is a little minnow down there. that is what we've got below the surface of the ice. so that goes down. and, if a fish were to bite the hook, the flag would trip up. and that's where blue trip tipses comes into play -- blue tips. >> you would thought the ice fishing community would be the last bastion you would get apps but you had tremendous success

on this, ryan? >> right. we started outgoing from normal light trying to figure something else out. we went with bluetooth technology straight to the smartphone and it has been going well ever since. >> i leave it to you, the apple versus google stock because, you know, this is the guys that, you know, one of them invented the app. the other person popularizing it with the technology they have got. i'll tell you. the app economy is just exploding out there. ceo of cisco telling liz earlier today, apps are the future. they must be if they're out here tracy: heck yeah. holy toledo, jeff flock voluntarily telling a app story in the cold. thank you, jeff flock. i hear ashley has a ice fishing story. ashley: what is interesting i lived almost every state in america as you know. one of the first ones was in montana. in the wintertime, east of the continental divide the huge

lakes become like the lake in wisconsin. everybody is out there and get the giant augers, electric ones and drill the hole. bring the tent over and drop the line in. they sit there. have a tv set up and fire going. i've seen someone running a microwave inside, hooked up to the car. tracy: you're covering this? ashley: yeah, because it is interesting. it is culture and way of life. always comes the springtime, when spring is almost here there are still people, they drop their trucks out to the lake in montana. so the truck is next to your little tent as you stay warm. you hear the dreaded crack. all of sudden truck goes straight in the lake. tracy: because. ashley: every year at least one or two trucks go down to the bottom of the lake. tracy: they don't pay attention. ashley: they don't pay attention. start cracking ice a little too much, a little late in the year, boom. try getting that car back. tracy: that is a job hazard. ashley: definitely. you don't want to be snowmobiler getting across the lake, doesn't quite make it. tracy: i love you covered ice

fishing. ashley: sled dog racing. great time. tracy: that will be in tomorrow's show. next half hour of "markets now," more about fishing. no, no. equally entertaining netflix shares streaming higher. dennis kneale with more growth ahead. how you make money on it. ashley: in tech minute, tivo in the clouds. why the dvr maker is canceling jobs. we'll be right back.

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through mercedes-benz sometimes they just drop in. always obvious. cme group can help you navigate risks and capture portunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world vances. ashley: it is 90 minutes until the close now, the dow off still more than 200 points so, therefore, a lot of red on the board. we to have some winners, at&t and mcdonald's. nicole telling us about mcdonald's just a little earlier. verizon, merck and ibm also on

the plus side. let's get down to nicole at the new york stock exchange. >> reporter: it has been a tough day on wall street. we took our cue from asia today where we got a weak manufacturing number which showed contraction. so we saw selling other in asia, saw it here as well. the dow at its lowest point was at 16,140, so we're about 23 points up off the lows of the day. that being said, we're still down 210 points. you're seeing financials, materials all lower and so many names in the s&p 500 with down arrows. one thing that does have an up arrow, and doesn't mean that is good news, and that is the vixx, the fear index. the volatility index is jumping about 13% at this point sitting at 1446. a couple of years ago it was at 45, back in the financial crisis it was at 90, so just to give you some perspective, but a big jump today in the vixx. back to you. tracy: thanks, nicole.

talk about pushing the boundaries of wearable technology, mc10 is a start-up based in massachusetts that makes stretchable, bendable, wearable electronics. looks like a temporary tattoo or band-aid with a bunch of dots in it. if you're on sirius xm. it monitors what's going on inside your body. joining us now, mc10 cofounder and chairman, carmichael roberts. sir, i think this stuff so cool. i was watching some of the videos of it. first, tell us how you even came to this point, because i've got to believe, you know, the intelligent was to help health care bring technology together and, clearly, make some money along the way. >> i think you got it exactly right. i mean, so where we got to is we started off working with a professor named john rogers at the university of illinois in champagne who had come up with a remarkable invention which was the ability to take silicon, so think about a rigid chip-like

thing, and turn it into a version that looks like saran wrap that can fit on any part of the body. and when we realized we had that, we could see where the trend was going towards wearable technology, and we thought we had something special that would fit very comfortably directly onto a human being. tracy: we all have to carry these ids around, and i always say someone should embed a chip this our heads because i lose my id all the time. part of the problem with the wearables now is they're so hard and stiff and uncomfortable. that looks like a band-aid, you probably don't even feel it. >> oh, exactly. in fact, you know, that's one of the things that sort of jumped out at us. if you think about the evolution of electronics where, you know, even getting to a point where your cell phone is such an important device, you know, smartphone is such an important device. still it's not something you feel like you're wearing, and it's not as one with the human. what we've got is a product that it really fits on where you don't even know you have you

have it on. you mentioned in terms of what it looked like. i don't know if you can see it, i'm actually wearing one right now that is like an electronic tattoo. tracy: we just showed a picture of an infant, because i know they're using them to check vitals, temperature, things like that. i also watched the video about the skull cap for concussions. everyone here knows i have a big sensitivity to this topic was kids are getting them all the time. the skull cap, $150 in your partnership with reebok. tell us quickly about that. >> sure. so, yeah. we look to try and find big, big trends that if we solve the problem or at least be part of the solution would make a big difference to just about everyone. and like you mentioned, concussion is one of these things where it's almost like an epidemic in that regard. if you come up with a way to just detect that a kid or even all the way to a professional athlete may be at risk for a

concussion, that would be a pretty big deal. that would make at the very least parents -- i have three kids that play contact sports -- parents feel a little better that their kids are safe. you don't want to stop kids from playing, because they learn so much from being involved in athletics. >> right. but you kind of want to to know what's going on in their brains, and this thing looks like a winter cap, and the light goes off when there's too much motion to the brain. quickly, too, before we run out of time, tell us about the balloon catheter for heart patients because that is just so cool. >> sure. so, you know, we just talked about two products, one that, you know, directly is onto the body, the other is the cap in my hand that can fit on the head. but the ability to have this saran wrap in electronics can also mean that you can put it on devices that go be in and measure things inside the body. so catheters are routinely used, and there are all sorts of electrical stimuli you'd want to

take a measurement from, so imagine trying to figure out things that are going on in your heart in a way that requires a very small incision, and you could run a catheter and take a measurement that literally the person can walk right now. something in neurology in that regard. tracy: you guys are seriously on to something. i want to get that hat, too, actually for my son. $61 million in funding, i'm sure there is more on its way. carmichael roberts of mc10, thank you for being here and sharing all this cool stuff with us, sir. >> thank you so much for having he on. ashley: very cool, indeed, tracy. now time for your tech minute. aol agreeing to buy gravity for $83 million. gravity tailors content according to a reader's interests. aol ceo tim armstrong saying, quote: our theory is the web is going from search to social, so personal. the acquisition will help aol better target advertising and use gravity's technology across

its own properties like tech crunch and the huffington post. shares of aol up over 63% in the last year. today down in a tough market, down almost 1.5%. on cloud nine, not if you are a city slow of staff member. -- tivo. all that is left on hand to handle support for currents and upcoming third party devices, skeleton crews. tivo is getting out of the hardware business altogether and making a, quote, wig direction change. in may of last year the general manager of products and revenue said software is the future of tivoment and dot.com no more, thousand the last part of your favorite web address could be changing. on february 4th close to 2,000 domain names will be hitting the web, 101 of those belong to google which is interesting since google has done a great deal to make domain names as useless as possible. google was the first to move the

search bar to the top of the web beige which allows users to type facebook rather than facebook.com. translation? everyone needs to use google, and google rakes in the ad revenue. so what domains will google own? dot.app, dot.movie, yeah, that domain name is available as well. dot.tracy. tracy: they are, like, taking over the dot preponderance world, aren't they? it's quite scary. all right, and here's more web lingo, hashtag nyc. twitter coming to the big apple. their new address, next. ashley: and liz claman gets an education on day two of the world economic be forum. ♪ ♪ liz: almost every ceo we've run into here in davos says the answer to high global unemployment is better education. but when it's outrageously expensive, what's the answer? uc berkeley's chancellor, the

president of harvard and the head of online education giant edex with their best ideas, coming up. ♪ ♪ i ys say be thman with the plan but with less ergy, moodiness, i had to do something. i saw mdoctor. a blood test showed it was low testosterone, not age. we talked about axiron the onlynderarm low t treaent that can restore t vels to normal in about two weeks in most men. axiron is not for use in women or anyone younger than 18 or men with prostate or breast cancer. women, especlly thoswho are or who may become pregnant,

and children should avoidt where axirons applied as unexpected signs of puberty in children or changes in body hair or incased acne in women may occur. report these symptoms to your doctor. tell your doctorbout all medical conditions and medications. serious side effects could include creased sk of prostate cancer, worsening prostate symptoms, decreased sperm count, ankle, feet or body swelling, enlarged or painful breasts, problems breathing while sleeping and blood clots in the legs. common side effects include skin redness or irritation where applied, increased red blood cell count, common side effects include skin redness headache, diarrhea, vomiting, and increase in psa. ask your doctor about axiron. ♪ ♪ >> jo ling kent with your fox business brief. jordan belfort, the real wolf of wall street, fleeced some real people. charlie gas perino spoke exclusively to one of them who says he lost more than $150,000.

>> and belfort likes to claim he only went after rich people, that no one was killed, that people didn't have to buy. but he's a thief. it is easy to forget that real people lost real money to the tune of $220 million. >> right. which he's -- >> fox business has learned twitter has signed a lease for some major office space in the heart of silicon alley here in manhattan. they aren't moving their corporate headquarters from san francisco but will take more than 140,000 square feet on west 17th street in midtown south. that's the latest from the fox business network, giving you the power to prosper.

tracy: it is day two of the world economic forum in davos. liz claman in the last hour sat down with cantor fitzgerald's chief howard lutnick and asked

him about how he's spending his 20th year at the event. >> the first time you come, you're sort of a little lost. i walked around, i bumped into things as opposed to knowing where to go and what to do. you were very much sort of missing out on things because you didn't know, and now after 20 years it's sort of like my high school reunion, you know? [laughter] i know even, we see everyone. we're sort of old friends right again even though i haven't seen them in a year. ashley: any ceo will tell you a well educated work force is the key to running a successful, dynamic company, but how to keep the qualified applicants coming when the cost of higher education so sky high. we go back to liz claman now who has a few thoughts, spoke with some leaders, has some thoughts on that topic in davos. liz? liz: you hear a lot of this in talf so, where'd you go to school? but with so many unemployed today walking around armed with college degrees that haven't gotten them a job, we are asking the question: is it worth it? and if the cost is so high and

continues to climb, are we pricing the middle class, not just the lower class, but the middle class out of a college education? fox business putting together an all-star education panel near davos. to my left, uc berkeley's chancellor, nicholas dereks, who gives us the state public side. harvard university president drew can -- and from the online education side, the company edex. a massive open online course company. welcome, and thank you so much for joining us to talk about this. i'm actually going to start with a little bit of a verboten question. is a college degree worth it anymore? chancellor derks, you take that one first. >> absolutely, it's worth it. it's worth it, i think, for everyone, and for all kinds of different reasons, not least, though, for reasons of social mobility. it is still the great engine of social mobility in this country. it turns out that if you're in the bottom quartile of the socioeconomic spectrum in the united states, you have without a college education under 10% of

a chance to exit that quartile and go up. if you get a college education, you have over an 85% chance. that sounds like a bargain to me. liz: it does, drew, except that the questions become the issue of expense, and you look at how the price of tuition has jumped exponentially, way faster than the level of inflation. how do people afford it anymore? >> well, college cost is something that all of us in higher education in the united states are very concerned about and, certainly, we need to address it. but we also see very important ways in which the private institutions of which harvard is one have tried to address this in recent years by greatly expanding our financial aid programs so that at harvard, for example, students who come from families who make under $65,000 a year pay nothing in the way of a family contribution to tuition and room and board. and we have a kind of sliding scale of support that includes a substantial portion of the middle class as well. we want to make sure that

students of talent find themselves able to afford institutions like ours. and we see in the public sphere schools like the one chancellor derks is the head of, such important flagship system in the state of california. real challenges because of diminishing public support which has translated into necessary tuition increases. so part of the rising cost of higher education in the public sphere in the united states has been the lowering of the public support for those costs. liz: well, i guess, anon, you're the one who really benefits when a student wakes up and says i can't afford harvard or berkeley, but i can afford to take courses from some of the top universities for free or for very low fees on edex. what have your numbers in enrollment looked like over the past year? >> we offer free courses and, you know, id-verified certificate for a small fee from some of the best universities in the world like berkeley, harvard, mit, georgetown and

others. so the number of students that come into take these courses are staggering. so we have 1.8 million learners on our platform today in the space of two years from every single country in the world. and so here they can get great courses, and they can also get a certificate which tends to be a signaling mechanism. and i see as time goes on we'll see multiple signaling mechanisms. there'll be degrees, of course, there'll be certificates, many of these things that can combine to allow the student to really display that they're a master at something. liz: chancellor, how do you look at online courses? if somebody wants to transfer maybe two years in and all they've got are mooks on a resumé, does it have legitimacy yet? >> well, we don't yet take transfer credit for all a mook courses, but we're part of the consortium weedex, and we believe very firmly that it can

open up opportunities for students in all kinds of ways including giving them access to the kinds of courses they'll need to apply to and succeed at and, for that matter, transfer to berkeley. a third of our students still come as transfer student, often from community colleges. they can't always get the courses they need there. and so edexis a partner we can use. liz: you see it here in davos, this ivy league of my school has 27 nobel prices. it is a door opener, isn't it? >> it continues to be a door opener, and it's a door opener really from day one. liz: but how? access has been what berkeley's always been about. >> access is one of our cree -- credos and, in fact, one of the things is that great flagship public universities like berkeley are able to bring this a swath of students that really goes well beyond what private institutions can do in part for reasons of scale. we have at berkeley alone as many pell grant recipient

undergraduate students as the entire ivy league combined. liz: thank you, all of you. we so appreciate it. uc berkeley chancellor, president of harvard, and edex president. thrilled to ave you here. >> thank you. >> thank you. liz: back to you in new york. ashley: liz, thank you very much. coming up on "countdown to the closing bell," liz will be sitting down with the ceo of citigroup. don't miss it. that's 3 p.m. eastern time right here on fox business. tracy: we have some breaking news for you now. the ap reporting chris christie's election campaign and the republican party committee have received subpoenas from federal prosecutors. now, it is all part of the investigation into allegations that his aides created traffic jams as political payback. a lawyer representing christie for governor and the republican state committee tells the associated press: the subpoenas are for documented related to the closure of traffic lanes near the george washington brick. a state legislative committee investigating the traffic jams

has also issued subpoenas to the two osars. ashley: all right. netflix shares streaming higher. dennis kneale coming up with whether there's more growth ahead and how you can make money on it. tracy: and blessed be the internet. why the pope his the web is actually -- thinks the web is actually a gift from god. it is! the dow's down 200 points, don't go anywhere. ♪ ♪ tte or au lait? cozy or cool? "meow" or "woof"? everything the w you want it ... until boom, it's bedtime!

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tracy: netflix, talk about net juggerne online stock soaring hitting a 52-week high on strong earnings reports. dennis kneale has the details. >> that's right. netflix up 16% right now, almost 20% earlier today, on adding 2.3 million new subscribers in the fourth quarter.

it now has almost 33 million streaming subscribers here, that's more than the homes reached by hbo. and netflix predicts signing up another 2.2 million fans this quarter, so the market isn't saturated yet. and netflix will double its original program budget to make more shows like "the house of cards" and keep them coming in. great buzz, but profits are so tiny for the fourth quarter, or netflix earned less than $50 million on over a billion in revenue. so that is only four cents of profit on every dollar of subscriber fees. that means netflix can't really fund expansion from its own revenue, it's free cash flow amounts to nly $5 million in q4, so it will borrow an extra $400 million for this quarter for that expansion. that increases long-term debt by 80%. netflix warns that rivals gearing up to catch it -- hulu, amazon, verizon -- but wall street is unfazed. netflix stock's biggest gainer last year, and it's up 6% or so

since the start of this year. so far the message is why worry? tracy? tracy: yeah. ashley: no kidding. tracy: scary, though, do you get in it? >> it's such a momentum stock, you definitely don't bet against it, but do you really buy against a stock that's up threefold during the past year? aren't there other stocks that have a better chance of rising? it is the lead player in the segment. tracy: thanks, dennis. ashley: pope francis is proclaiming the internet is a gift from god because it facilitates communication. well, that's true. if that's the case, it seems like facebook may have committed a sin. according to a new study from president of the united stateston -- princeton university, the social network site can be expected to be defriend by 80% of its users. search data dangering facebook's popularity and notes the decline in facebook's users, a decline that is very similar to that of the now virtually extinct myspace, although as the critics point out, myspace was

never the social platform that facebook is today. tracy: dennis is shaking his head. >> the reason myspace was -- it never hit critical mass. facebook has over a billion people in the tent, and most of them are people with money to spend, people advertisers want to reach, and once you set up on facebook, they've got you. you've got everything there. to to take it all down, two to another service because it's hipper, i think most people aren't going to do that. they liken it to a virus, but facebook is like a parasite. a parasite is smart enough to stay inside the host and not kill it. the virus kills the host. ashley: very graphic, dennis. tracy: talk about the next generation coming up the ranks. so you're saying the generations using it now will continue to use it because they're too lazy to move, what about the youngers saying facebook's no longer cool because my mom's on it, and they go somewhere else, so they become parasites. >> but that's three to 11 million who -- and advertisers don't care about reaching 16-year-olds, they care about

40-year-olds -- tracy: because we pay the bills of the 16-year-olds. ashley: exactly right. >> i think facebook's got a long run ahead of it before it turns into some virus-killed host. la of laugh. ashley: time will tell. coming up on "countdown to the closing bell," well, he loves apple, he's youth spoken. one of the most feared and talked about billionaire investments, he's joining charlie gasparino in a fox business exclusive. you cannot afford to miss this, stick around. ♪ ♪ ♪ ♪ [ tires screech ] chewley's finds itself in a sticky situation today after recalling its new gum. [ male announcer ] stick it to the market before you get stuck. get the most extensive charting wherever you are with the mobile trader app from td ameritrade.

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he's apparently canceling some meetings. don't know what that's about. we just ran into israeli prime minister benjamin netanyahu in the hallway. a lot of people following him, trying to talk to him. there's chatter about whether he might pass rouhani in the hallway, don't think that's going to happen. nobody's really talking about the pope and how he has slammed davos saying it doesn't do enough for the poor, but nearly every ceo i've spoken to, including muhtar kent of coca-cola, saying global unemployment is their number one focus right now. coming up this hour we have a very rare interview with citigroup's ceo, michael corbett. they just missed quarterly earnings. perhaps more importantly, wait until you hear his growth estimates for both emerging markets and the united states. and, yes, i asked him what he thinks of bitcoin. it's kind of interesting. and a conversation with easily the most international ceo here. he was born in brazil, he's french-lebanese, he speaks half a dozen languages, and he