is merger mania in the cable industry...doing a dis-service to customers? in today's cover story.... whole foods faces new challenges from wall street to main street. plus...facebook fraud is just a "click away" and... why twitter employees might be unloading shares of the stock this week. first business starts now! you're watching first business: financial news, analysis, and today's investment ideas. good morning! on this tuesday, february 18th. i'm angela miles. in today's first look: stocks score a win for investors. the market just keeps heading higher. friday's rally wrapped up the best week of the year for the

dow & s&p. and nasdaq reached it's highest level for 2014. gold pushed upward..as oil continues to trade above $100 dollars per barrel. banks get the okay to inhale pot money. regulators made it possible for banks to do business with licenses marijuna companies. and autoworkers at a volkswagen plant in chattanooga tennesee voted to become a union shop. it's huge plus for uaw. it's the first the union organize worker at foreign plant. and autoworkers at volkswagen plant in chattanooga tennessee voted to reject a union. it would have been the first time the uaw organized workers at a foreign plant. scott bauer of trading advantage joins us now for some trader talk on this tuesday morning. good morning to you. >>hi there angie. >>what are you watching for this week? will you be watching the commodities space? >>last week we saw the heavy volume was really in the commodities space. and actually lots of volatility especially in natural gas and oil and gold. we saw gold top1300 for the first time in quite a while. although the market had this

huge comeback, the huge rally got us back almost to near our highs where we saw volatility actually just get hammered in the overall market. in the commodities space, volatility is actually as rampant as we have seen it in the last probably couple of years. so i expect that volatility to continue. i expect there to be more pressure in the nat gas space, the oil space, and actually with rates subsiding to where they have beenthe 265-275 levelthat finally has accounted for this rise in gold. people are flocking back to gold now. >>i also want to ask you about earnings. what are you watching for, let's say in herbalife? >>in herbalife actually i think that the upside is actually fairly limited. what everyone's gonna be watching for is there any hint at all of a slowdown? any hint of bill ackman's accusations of the improprieties? i think to the upside herbalife has traded over 70. but the real pressure would be to the downside with any sort of bad report or bad

guidance. >>thank you scott and have a great week. >>thank you. you too. paul eggers fills in today for chuck coppola--good morning. good morning, angie...its a short week after president's day, and that's good news for whole foods, who had a looong week last week. in today's cover story, a closer look at the problems dragging down the up market grocer. investors lost thier appetite for whole foods for a while last week.. the stock sold off nearly $6 dollars thursday after the grocery chain lowered it's outlook for the year. it then rebounded 79 cents friday. competition, from the likes of privately held trader joes and public firms sprouts farmers market and fresh market are putting pressure on whole foods at a time when the chain is adding new stores.

whole foods public image also faces a bit of a battle. in chicago, employees have rallied behind rhiannon broschat, who lost her job recently after missing work to stay home with her child when winter weather shut down schools. "you know, people come on tough times and i believe, i strongly believe that if you have proof for why you're not going to work, that should be good enough." we reached out to whole foods for comment, but they did not return our calls. the labor management issue, then, underscores a reality check for

a name once held in high regard by investors and consumers " when their veneer breaks through, and people see that this woman was good at her job, if you're good at your job you should not lose it. so i feel like trust in the company has been violated because they pay so that workers get treated fairly. and it was very clear that rhiannon was not treated fairly." perkins of morningstar added that whole foods has a first- mover advantage over its competitors and he sees strong long term growth prospects for the company despite the recent dip in stock price. the brutal cold snap is putting a dent in u.s. factory orders. production of cars, trucks, appliances and furniture plunged along with the temperature. factory output fell by 8 tenths of a percent in january... putting a damper on 5 straight months of increased production. in the auto sector,-- fewer cars rolled off production lines in january as plants closed

because of snowstorms. just because americans are going out less this winter, doesn't mean they are saving more. bankrate finds only 51% of people have emergency savings stashed away. so even though foot traffic has been slow in stores this winter, more people are still finding ways to spend from indoors. "well the weather has certainly kept a lot of people home, and maybe alot of people out from spending money at stores and restaurants, but the internet connections are still working and so i think the tendancy for people to spend rather than save is alive and well even if they are at home getting cabin fever. " americans could just be waiting for their tax refunds to boost their rainy day fund. td-ameritrade reports 61% of people plan to save -- not spend -- their refund this year airlines and passengers wallet's are taking a winter wallop as thousands of flights are cancelled or delayed due to the weather. gabe saglie of travelzoo is navigating the tourism industry for us. good morning to you gabe. >>good morning. >>what about these passengers? people are missing flights left and right here. >>there has been a series of flier headaches all through the winter season. the numbers are just out for januaryestimating about $150 million in losses for the airlines and $2.5

billion in losses for consumers who have had to spend extra money when their flights get canceled or severely bumped on things like hotels and meals. the costs are adding up and february has shown us it's not getting any easier anytime soon. >>what can people do? >>i think if you have flights planned you want to be as aggressively prepared as possible with information. sign up for flight alerts with your airlinesthings like cancellations, delays, and even gate changesyou get them first through those alerts before pretty much anybody else. check the weather. make sure you know exactly what the weather is going to be like where you're taking off and where you're connecting. and if it's a big ticket item, do consider travelers insurance. >>will the airlines get a bump in the end though as more people try to get out of dodge and away from this winter weather? >>i think as we look toward spring break and generally the spring travel seasoni think there is pent up demand from consumers over the next couple of weeks. i think we're going to see some increased bookings to some popular warm weather destinations. florida has

already shown some increased traffic. and that could send airfares, as you can imagine, up. >>thank you for that update gabe. >>thank you. as consumers count down the days till spring, some companies are actually enjoying winter. campells soup sales are on the rise. the company's profits are climbing , as consumers cook up more warm meals. the cold climate is also bringing robust demand to winter clothing brands, propane companies, food delivery services, salt suppliers, and plumbers. a major bank is out to once again profit on subprime lending. wells fargo, the largest mortgage lender in the u.s. is reported to be tip toeing back in to subprime loans. reuters reports the bank has worked through its crisis- era problem mortgages. but now, overall mortgage lending volumes are down. wells is said to be taking small steps into extending credit to borrowers who have higher credit risk. jos. a. bank is making a bid for eddie bauer in its latest effort to stay independent. the men's clothing retailer is offering $825 million to bauer's parent, golden gate capital. the deal includes $564 million in cash and new shares of common stock. jos. a. bank has been fighting off a hostile takeover bid from rival men's wearhouse. the eddie bauer buy can be canceled if jos. a. bank's board accepts the bid from men's wearhouse. jos a bank stock climbed 36 percent last week..

home depot and lowes are attracting activists. they blame the home improvement stores for killing billions of honey bees. the activsts delivered petitions with thousands of signatures demanding the retailers stop selling neon-ick o-tinoid pesticides. it's estimated up to $30 billion dollars in u.s. agriculture depends on honeybees. bees are dying by the billions according to beekeepers. home depot told first business: "we're more than happy to provide customers with alternative products" lowes did not return our request for a comment in time for our broadcast. the faculty union at university

of illinois' chicago campus is set to strike. classes at the university will be cancelled today and tomorrow after 95% of the faculty voted to authorize walkouts. the unions have been pushing for a new contract since july of 20-12. the faculty is asking for a higher minimum salary for full time lecturers, and a 3.5% raise. the administration has offered a 2.75% increase. u-i-c did not return our request for comment. people working for twitter have their first opportunity this week to cash out of nearly 10 million shares. the stock debuted on wall street last november.. and the the lockup period ended over the weekend. analysts tell marketwatch it's not likely to put too much pressure on stock. however, coming up 475 million shares that were restricted during the ipo offering will become eligible for sale in the market in may. shares gained 5% last week. procter & gamble has struck social media gold at the sochi olympics. the consumer products maker is far ahead of other corporate sponsors with 27

million youtube views of its commercials through the first seven days of the winter games. visa comes in second, with 10 million views. the irs has a message for taxpayers: don't call us. instead the agency urges americans to go online to irs- dot-gov for answers to tax questions. this week tends to be one of the busiest in the tax-filing season, and the irs typically braces for a barrage of phone calls. the irs has already cut $64 billion dollars in refund checks as people submit returns more quickly this tax season. still to come: are companies going too far for a "like" .... we'll expose the business behind getting noticed on social media. plus....could an enormous merger between comcast and time warner knock netflix ? and.... . bill moller sifts

through why that complicated merger could be bad for both companies and consumers. that's next!

a great hue and cry has gone up following the monster merger proposal between comcast and time warner. a legion of lobbyists on both sides is being deployed to kill or advance the deal. but aside from what the justice department's antitrust division will consider - does the business case for this merger make sense? jeremy eden is one of the founders of the management consulting firm harvest earnings and co- authored the book low hanging fruit. if approved, how complex a merger will this be?

>>this could be incredibly complex. it's an 160,000 person company. they're gonna do everything from run theme parks to provide internet services to develop new technologieseach of these companies today is hugely complex. together they are going to be enormously hard to manage. >>comcast is touting this as a deal made in heaven. it's going to have all these efficiencies which will increase earnings and be great for customer service. what do you think? >>it will certainly have some efficiencies and will deliver their billion that their touting but complexity kills. it kills innovation, profits, culture. it could kill morale. no ceo i've met has ever said boy i wish my company was more complex. complexity adds a hidden tax and what they're gonna end up with is a lot of extra costs that are going to offset that billion five. now they could get at them but i don't think they will. >>do you think just the sheer size of a merger sometimes by that fact alone makes it almost unwieldy? >>absolutely. they will run, they will provide services, things will happen but the

billing complaints that they get from their customers today that might be 7 layers removed from the ceo is now gonna be 10 layers removed from the ceo. where most of the cost and efficiencies are going to be gained would be at the bottom of the organization. this is now going to be a much more bureaucratic and political company. >>you mentioned one billion five in efficiency savingsyou think the potential would be much higher if they could figure out the way to find those efficiencies. >>easily. it could be 3 billion plus---maybe even more than that. and that's just on the cost savings nevermind the revenue side.pnc financialwhen they did this they were a third or smaller the size of comcast and they delivered 2 billion dollars. they did it because they actually looked at the bottom of the organization to find all of these hidden inefficiencies. >>maybe they're listening and will have it figured out. jeremy eden thanks so much. >>thank you.

thanks bill. if its approved, the merger could land a major blow to netflix. netflix depends on cable networks for broadband service. if the deal happens-- comcast will have more power. comcast already considers netflix a competitor as consumers unplug from cable and hook up to netflix for on- demand shows and movies. fortune magazine "suggests" netflix could become an attractive takeover candidate or merger partner. netflix shares bounce higher last week. coming up...the stock that's full of surprises on wall street. thats later on in chart talk. plus...how companies are faking popularity with some help from digital era "sweatshops" that story is straight ahead.

talking to veterans about the real issues they're dealing with can be awkward and uncomfortable. we think to ourselves, "i never served. how could i understand? they'll talk about it when they're ready." and then we wonder why they don't want to talk.

but when their behavior changes, when they withdraw to themselves, increase substance use, or even talk about hurting themselves, it's time to act. because if we don't, our families and relationships will suffer. ask the hard questions. listen to the veterans in your life and show you care. make the call. it matters. when you recognize a veteran is in crisis, call the veterans crisis line at 1-800-273-8255 and press "1". the greater the number of "followers" on twitter ---or "friends" on facebookk-- the better it looks for businesses. but beware. desperation to build up fans on social media has spawned a cottage industry known as click farms. ky sisson

explains... click, click, click for cash! in today's pop-culture the number of friends, likes, and views are often equated with brand value and credibility. the growing business of selling a fake social media presence online has public relations professionals outraged. click farms are absolutely fraud because they are misrepresenting a very real dimension to interaction. click farms are a thriving overseas industry dubbed "the new sweatshops." where workers are paid roughly seventy-five dollars for a thousand "clicked" endorsements on social media platforms. this may seem inexpensive, but in the long term, it's a costly marketing strategy. obviously if you destroy trust, lying to the public, that hits the very core of what you are trying to do, trying to build, sky dickenson is

the digital activation manager at a pr firm for clothing lines in hollywood. her firm works with startups who often struggle to get the necessary following to create a valuable, reputable brand. i don;t think purchasing "likes" is a smart thing to do, because you literally will have no idea who is actively enjoying your product, or who's actually enjoyng your services. she says businesses need to steer clear of buying into the bogus and use social media to sell, not impress. if the aesthetic is there, if you know what you're doing, you're staying with the trend...you're going to sell. it's a marketing tool that's gonna last foprever i think. click farms are estimated to be worth hundreds of millions of dollars and with no laws against them and social media sites having trouble policing them, users are craving what facebook and twitter were created forinteraction with real people.

you're dehumanizing a process that was meant to be humanized. a huge component for people to trust a brand, view them as credible, is that they want personable interaction, to be invited into a conversation with response, so organizations that are purchasing this, they cant be personable with fake people facebook estimates of the 1.18 billion active users, over 14 million of thise are fraud reporting for first business news, i'm ky sisson. facebook also recently reported-- it's continuing to improve its system by monitoring and removing fake "likes".. still ahead : tesla is a rip roaring stock that has been racing up the charts. will this week's earnings slow the pace. that and more after the break.

time now for some chart talk on this tuesday morning with andrew keenepresident of keene on the market dot com. good morning andrew. >>good morning angie. >>people are really awaiting these earnings coming from tesla coming tomorrow. what do you think about the chart? >>if you look at the way tesla sets up it's actuallyif it sells off you're gonna say it double topped at $200. if it goes higher you're gonna say when does resistance become support. from my point of view i want to see what the quarter does. i think they'll have a good quarter. last time the stock got taken to the woodshed and got absolutely chopped up.

however, this time i think it will have a good quarter. i'll be looking to trade it, but i'll be doing it through the option market. so maybe buy the 215-225 bull call spread. i could probably risk about $2.70 or $270sets me up about 3 to 1 reward to risk setup. the straddle market as we talk about is implying the stock to move $25 this week at 12.5% move either to the upside or the downside. so it should find buyers around this $175-180 level. it could get as high as 225. if we get a pullback i will be looking to get long on a pullback around 175-180. but i want to find buyers first before i just jump right in there with my eyes closed. >>exactly. most of us are shocked that this stock is even trading around $200. is it the value that's moving this stock or is it just the hot money? >>people have to realize that 90% of where a stock actually trades is just a supply/demand curve. if there's more buyers of a stock then the stock moves higher because they're pushing up the stock price. if there's

more sellers then they're pushing the stock price down. look at appleit went up to $700, then it went down to $375. tesla was so weak after it had earnings. it was making lower lows and lower highs on a daily basis. then they flipped things around and the stock started moving back up. so this is a huge momentum play. whatever it does in earnings it will probably continue in that direction for a while. >>and a quick mention on southern copeprwe just have a couple minutes left. >>in southern copper we saw unusual option activity. buyers of the september 37 callssomeone's making a big bet that southern copper (scco) can get up to that. i am long these calls. the chart looks great. it does have some headwind around this 32 level. at 30 it should find support if it does pullback. i am long this stock via calls all the way to september. >>thank you andrew. >>thank you. it's time for us to hit the road for today. coming up tomorrow... details on the cost of delaying to sign up for obamacare. it may hurt more than you think. from all of us at first business, thank you for watching and have a good tuesday.

>> announcer: the following is a paid advertisement for armando montelongo live events. you're about to meet a man that can change your future now. he is america's top real-estate investing expert, he has been featured on the number-one real-estate hit reality show, "flip this house," and is a best-selling author. he is the most sought-out real-estate expert in the world and has changed thousands of people's financial futures. you now have the opportunity to spend time learning armando's money-making real-estate strategies at his live event coming to your area. >> after attending one of armando's seminars, i started making offers, got into a property, made $35,000 net profit. >> after learning from armando's