tv FOX Business After the Bell FOX Business July 2, 2013 4:00pm-5:01pm EDT
50. [closing bell rings] but that pop is not reflected in the stocks right? >> we're not seeing that in stocks. you see airline stocks pulling back because of it. liz: here comes the bell. david, what an interesting day. because at one point we were well up above the flat line. then we fell well below it. up 74, down 72. here we are ending down about 44 points. the russell getting clipped by about just a traction here. -- fraction here. nothing to write home about. the dow jones industrials got hit. here are the front page headlines. the commerce department reported factory orders rose 2.1% in may. orders for durable goods, big-ticket items were up, 3.1%. david: the reason oil is up is because of egypt. the military drawn up a plan to dissolve the ledge you're and set up an administration if president mohammed morsi does
not reach an agreement with his opponents. the military set wednesday as the deadline for a deal. liz: corelogic reporting that u.s. home prices jumped 12.2% year-over-year. that is the most in seven years. the firm said prices rose in 48 states, and fell only, we know you were asking, delaware and alabama. david: nasdaq officially filed a motion to dismiss the class-action suit filed against it with regards to the botched facebook ipo. nasdaq arguing it has immunity because it is a self-regulatory organization. we'll see if that stands up. liz: bill gross's pimco total return fund suffered record outflows in june. the fund so you a net outflow of $10 billion, wiping out the 3.45 billion it saw from january through april. david: the twins known for battling mark zuckerberg for the facebook ipo for the trust. this trust is exchange traded
fund solely tracking bit coins with $20 million worth of shares. stay with us after the bell starts right now. liz: is it me or anybody else out there wrapping their mind around bitcoin? david: despite the queries about it is up and up they are moving forward at least today. liz: let's move forward. paul deet strict, he says, don't change youred's anticipated mov. larry shoafer in the pits of the cme. larry, we were talking with traders in the last hour. they were saying a compilation of bunch of issues from egypt to bill dudley from the new york fed starting to make comments. what did you see and why do you think it happened? >> liz, i think what you said
hit the nail on the head. some of it is weak hands right now. we have a lost things coming up especially during the 4th of july, ec. p, bank of england making policy changes or maybe not making policy changes. we have our unemployment report coming on friday. earnings season is coming up. something like egypt which is a very big deal however, it is just creating people, atmosphere of where people just want to get out, want to get out of the market all together. not interested in a gentle upward flow we've seen in the early part of the day. david: paul, it is true we have these big important numbers on friday, the june employment numbers but what is moving the market more now? is it concern about the numbers or is it concern about fed tapering? >> i think investors have overreacted to the fed's remarks earlier this month. this fed is not going to do anything dramatic. in fact, this is going to be a
reactive tapering policy. meaning, that, as real economic growth goes up, they're going to taper a little bit to offset and to start winding down their -- david: what you're saying is that the fed tapering concerns is weighing more heavily on the market but the market's wrong in letting that happen? >> exactly. investors are in the end the federal reserve is only going to start tapering after they see real economic growth. it's going to offset that economic growth so that investors in the long run are not going to see any major difference. liz: i'm sure in the pits of the cme, larry, there is no shortage of chatter when, what, how, where but fact is that paul is right. you can't sit there and start moving around on what you knew would eventually come to pass and that is some type of tapering but do you see flows, trading flows that indicate to you that people are starting to
do that and if so what do they look like? >> no, i'm not seeing flows of that at all. what i'm seeing is people are in chaos right now. what happened last week really left a mark. somehow the market crossed a line. we all know that taper something going to occur at some point and people are wondering why did the market go in such a tailspin on something we all know will happen sometime and only will happen when the data is good enough to warrant it happening? it really did leave a mark. people are more skiddish than anything else but i do need to say a lost action last week was fast money hedge funds. we didn't see any of the old money really liquidating en masse. i think they're staying put. david: paul, another thing that scared the hello out of the markets last week and week before, was china, concern whether they were going into a tailspin. you have a very interesting contrarian take. you think china is actually about to take off right now. explain. >> that is exactly right. it is no surprise to anybody in
the united states, politics and government affect the economy here. that same is true in the centrally planned economy called china. if you look at the transition of governments, these 10-year, decade-long transitions you always see a slowing during the transition period. it is also a period between the economic plans, the five-year, and 10-year economic plans. now those plans are in place. they have been published. they have a new government that's in charge of implementing those plans and what we are going to see, i mean they're breathtaking. they're talking about moving 250 million people from rural areas into cities, newly-built cities over the next 12 years. that's, the amount of commodities that are going to be needed for that to be implemented and they will implement it, is just outstanding. and they're going to start buying those commodities, i believe, and start making those
purchases at the middle to the end of next year. so now that we're at a multiyear low in commodities, this would be a really good time to be buying commodities in anticipation of these new five and 10-year growth plans in china. david: interesting. liz: from an asset class, like commodities, to an actual area, you know the msci, etf has gotten shared like a deck of cards, pick a country, any country, i know you're looking at south america and central america and is there a point on the map that you think is poised to really run? >> after the great recession for the last 15 or 20 years where our economy was built on banking, investment banking, financial manipulation, you know the bond market, the ip-o market and what's happening with this recovery is really looking good.
i mean we see manufacturing being reshored for the first time in, six, 15, 16 years to the united states from asia. coming in from europe we see the energy renaissance coming in. housing is coming back. our new economy is really being built on a solid foundation. agriculture is another area where wealth is being created in the midwest. liz: you're not biting, paul. i thought you liked mexico? >> and i do. canada and mexico are, i see are, north america, in terms of canada, mexico and the. >> , we're all going to be energy self-sufficient cent. we're going to be producers and. we have everything that the rest of the world wants. plus we have a 450 million person economy in north america. and that's why i think mexico is undervalued at the moment. david: larry, one thing we don't have enough of anyway is jobs
right now. before i go i have to get your clue, what are you hearing from traders? what are they expecting from the jobs numbers on friday? >> traders are expecting consensus 155, 7.5, 7.6. what traders say we need the number below 110 or above25 before causing a panic in the market. there is a wide range. good news is good news, if we see a print 285, 110, 225, anywhere in that range we should be okay this friday. david: broad range. paul dietrich, thank you very much. larry we'll see you in a couple minutes when the s&p futures close. >> okay. liz: the fed has spoken and we know, it could, it could begin tapering its bond buying program bit end of this year although it's not a done deal. the question now, what should you, if you were a billionaire, as somebody who started not as a billionaire, what would you, what should you do with your
investments now? we are asking a legend in the world of investing, billionaire wilbur ross, w.l. ross chairman and ceo. david: also all this week we're bringing you top strategists across all sectors of the market to give you your second half setup. what is the second half of the year going to look like? up next we have your best portfolio plays in retail, the retailer sector. we want to hear from you. june auto sales are coming in stronger than expeeted today. are you planning on buying a new car this year? if so, what kind of a car? facebook.com/afterthebell, we'll read your anticipateses later this hour. ♪ [ male announcer] surprise -- you're having triplets.
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liz: have you ever seen a ceo get booted and drop al album, cut an album? andrew mason of groupon did that. you can buy it for $9.99 on i tunes. david: deal for groupon, they add ad new policy to compete with some restaurants that offer certificates online. they have a new program to compete with open table essentially, that will give them a leg up and they did extremely well today. but we're going to the s&p, find out what the s&p futures are
doing right now. liz: liz: larry shoafer in the pits of the cme. what does it look on very low volume, we know? >> traders focused on ecb and jobs numbers on friday and earnings season next week. the big picture trade remembers worried about, why and how did they let the market get into a tailspin over tapering when they knew at some point it was going to happening? is there some secret bubble brigade we don't know about? is there communication chaos somehow the fed lost control of what is going on right now? or is the growth outlook so many different from the fed that the market implies, traders are worried about that, and that's why we're seeing knee-jerk reactions last couple days and that is what trade remembers focused on. >> larry, thank you very much for that report. you may have noticed we were talking about groupon a minute ago. that is because nicole petallides is down on nyse. we had trouble with her camera.
we think we fixed the trouble. there she is. >> i'm waiting to talk about groupon because this is an exciting time for the stock and for the company itself. in addition to getting a buy rating from one of the analysts today, you see up arrows for groupon. it was up 3.25% today. as you noted they will be doing online booking for restaurants and that's a big deal here. discounted meals and the like. they also got a buy rating with a $11 price target over at wunderlich. that is one point we follow groupon. that is name that grasped wall street's attention at least today and going forward. we'll continue to watch it and it's a nice chart. liz: thank you, nicole. david:-week take it. as the second half of 2013 begins retailers pray warm weather will bring out more shoppers. this year's cold winter and spring had a major impact on retail sales. what can we expect in the second ha half the-year in our second day of the second half series.
liz dunne, joins with us her favorite outlook and favorite retail buys. good to see you, liz. >> thanks. david: what is your overall take on how the first half did for retail? >> the numbers are still coming in the first quarter and second quarter. most met earnings expectations but across the board sales were weak. david: we should mention again the botulinum per people like. the top lynum per was not so good. they squeezed operations to the point where they had good botulinum members but number of consumers coming out were not what was expected right? >> we had unfavorable weather. it was cold relative to last year. david: david: cold spring too. >> the second quarter is little more normal from a temperature standpoint but my sense sales trends haven't been great. consumers are tight over the purse strings. david: they don't have that much money in their pocket.
david: in some cases they're dipping into savings to buy more. that can't go on, can it? >> taxation has been higher. that has been a drag. they have been dipping into savings. that is trend typically only see happen for a couple of quarters. there has to be kind of a comeuppance a little bit. david: are we getting to that point, that tippingpoint where they can't dip into savings anymore than they already have? >> savings are near historic lows. i think we're getting to that point. the back half, can income growth accelerate to get consumers spending? david: how will retailers prepare for less disposable income from consumers? >> they're really controlling inventory. they're once again squeezing operations and trying to keep a, tight cap on expenses. and inventory. so that they can mitigate the risk of potentially sluggish sales. david: who is doing a bert job of that? which retailer specifically? >> you know i like a number about retailers. i like coach. they certainly have had a
difficult time on the top line. i think that has more to do with handbags and where they are in the cycle. maybe some competitive pressures but i think they're doing an excellent job maintaining operating margins. david: they have such a strong brand. the coach brand, no matter what shopping mall you go to is one of the strongest there is, right? >> it is a blessing and a curse. law of large numbers. how will they grow that market share in north america? they're looking other areas they can grow their business in like footwear, like asia, like men's. you know that is their approach in the face of may be what may be sluggish top line. david: by the way my 20-year-old daughter got a summer job at abercrombie. i was a little hesitant because i see how some of them dress. she is doing the non-showing part of it so i'm okay with that. but you think they're doing great, right? >> their top line trends are sort of sluggish but how do they control operations. abercrombie has been historically bad 59 managing expenses.
david: they're getting better, aren't they? >> they're getting focused and trying to lock down areas of opportunity. focusing margin expansion instead of just the top line is i hate to end with a november negative. a couple have to be pointed out. coles you think are tough time ahead? >> moderate is tough space. you're going to mass channel or off price channel or increasing the online channel for more value, more brands and more convenience. i think that is carving away at their value proposition. david: at the risk of ticking off my producer, i don't want to end on a sour note, china, we were just talking about. china has this market that could be tremendous. any opportunities for retailers in china right now? >> yeah, i'm focused on global growth names. coach has a big opportunity in china. ralph lauren has a big opportunity in china. a couple of companies i'm not recommending tiffany and fossil also have big opportunities. i think companies are taking a measured approach to that market and not going too fast but it is
clearly a huge opportunity for the next decade. liz dunn, thanks for coming back come see us again. >> thanks for having me. david: liz, over to you. liz: david, when we return, too big to fail. the fed unveils new proposals to designed to protect the nation's biggest banks from risks that bring down the entire financial system. plus we're speaking with a billionaire. billionaire investor wilbur ross will join us to talk about the fed's efforts to dampen speculation about the beginning of the end of monetary stimulus but perhaps more importantly he will share with you what he is doing, what he is investing right now. whether he anticipates ben bernanke's move. stay tuned, wilbur ross coming up. ♪ clients are always learning more
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david: time for a quick speed read. five stories one minute. good news out of spain. summer tourist season generated more jobs. but the unemployment is still just above 20 7%. apple beginning back to school promotions. for the first time the iphone is included in the eal. they will receive a $100 gift card for purchasing a mac and $50 gift card for i mack or iphone. free tv on smartphones, laptops or tablets. customers will access 14 channels and up to 75 on demand
shows. jetblue airways announcing a new deal with sam adams. the airlines will sell the beer on flights. that sound good. after the brewery began using cans this summer. sam adams spent two years developing the new cans. just in time for the 4th of july the average price of gallon per regular gasoline falling below $3.50. that is good news that is today's "speed read." [buzzer] david: i love sam adams. liz: the federal reserve approving stricting regulations for banks to prevent a repeat of the crisis which none of us wants to see again. promoting living wills as part of dodd-frank reform. david: do the new standards come with new cost for the banks? fox business's peter barnes joins us from d.c. peter whenever you have new recs it always seems to cause people
more. -- new regs. >> david and liz, let's get to the one involving tougher capital rules for banks. one analyst says the announcement was good news for smaller banks and maybe not the best news for largest banks because the fed also announced a bit of a surprise, it wants big banks to hold even more capital and will start a whole new rule making for that. but the rules announced today, by the fed, would be used to help banks absorb losses if there is another crisis to help make sure that banks are not too big to fail. >> strong capital requirements are essential if we hope to have safe and sound banks that can weather economic and financial post-traumatic stress disorder while continuing to meet the credit needs of our economy. >> most banks have been preparing for this for the past few years and the fed had already required some increases in capital. so it says that most banks will meet these new standard bfed ane
making to require the eight largest banks, bank of america, jpmorgan chase, citi, and the others to hold even more capital because they are systematically important in the global financial system. now about 100 regional and smaller bank holding companies out of about 5,000 regulated by the fed will have to raise more capital to meet these new standards. $4.5 billion by 2019 according to the fed. and community banks sought and won some breaks in these rules after they complained they would be costly and burdensome. eric sea berg with guggenheim partners said, quote, regional banks and small banks have reason to celebrate because of these rules. for the biggest banks there is little to cheer. separately the second thing we want to mention are the living wills, liz, you mentioned in the intro. the, under dodd-frank the big banks have to provide resolution plans to wind themselves down if they get into trouble so they're not too big to fail in the
future. the big banks did this last year. we have four more banks doing it today. bnp paribas, hsbc holdings, rbs, royal bank of scotland and wells fargo. this gets too weed did i for the nonbank u.s. assets. back to you. no test. david: i hope i never have to wind myself down. that is an awful idea. >> david, we're always winding you up. >> all right. peter, thank you very much. good to see. >> thank you, peter. david: we all know it is coming. the fed will taper its bond buying program at some point. so how are the biggest investors reacting to this decision? billionaire investor wilbur ross is joining us next and he is going to tell you where he is putting his money right now. liz: plus, so apple held the top spot on baron's annual most respected companies list for the past three years but not anymore. a new company is taking a bite out of the tech giant. we're going to tell you who ranks in the top five and more
david: time for a look at today's market drivers. after a strong start to the trading day the markets ended in the red. the cow end -- the dow ended at session lows. factory orders climbed 2.1% in may to 45 billion which was right in line with street forecasts. this is the third straight month of gains, suggesting a pickup in manufacturing following a week start to the year. oil climbing to its highest level since may 2012, up 1.6%, closing at $99.60 a barrel. oil hasn't touched $100 a barrel in over 10 months and has not closed over $100 in more than a year. liz? liz: okay. "barron's" released its list of the world's most respected companies for this year. there is a brand new leader after apple was pushed aside following three years at the very top. joining us now, "barron's"
senior editor about this list. let's talk about how you compile it first. >> the list is done by a survey company for us and they ask a bunch of investors, some of them big, some of them small, to rate the biggest 100 companies by market cap. highly respect, slightly respect, don't respect and no respect. points are given for each one and totaled up for a mean. >> do you think it is leadership or do you think it is the actual product? what is it that gets people to say i respect such and such? >> probably a lot of things. we give them choices like strong management, sound business practices and frankly other things get involved like product innovation. i have to tell you even stock price. a lot of investors may not admit it but i think the stock price has a lot to do with it. liz: sadly they're not remembering the case of enron and the stock looked pretty good and we know what happened there. >> right. liz: clearly lessons have not been learned. >> that's correct. liz: let let's talk about sectors first. are there the most respected
sectors and sectors not held in high esteem? >> couple interesting factors. banks and big global banks especially get little respect. that is residue of 2008, 2009 financial crisis. jpmorgan was i think 45. so that's not really that high. another area that doesn't get loot of respect is tobacco companies. and as one of my sources said, it is hard to respect a company that kills its customers. liz: wow! >> some sectors don't do well. health care has really not done that well. it used to do well. and there is russian, this is not a sector, countrywise, russian and chinese companies never do well. lack of transparency and lack of rule of law. liz: exactly. lack of transparency. how people talk u.s. will lose listings because of too much regulation. and the other side of it there is problem. everybody is screaming give me the list. number five most respected?
coca-cola? >> then google. liz: didn't it used to be number one? >> coke? coke has never been one. liz: why do you think? product not perceived as not healthy? >> getting to be number one is such a confluence of factors. it's hard to say. i think people like what they're doing now but it's hard to say why they have never been number one. ge was number one the first time we did it. you see what happened there. liz: number four. >> number four is google. google is getting a lot of press and a lot of votes because of innovation which sort of ties in with apple and why apple may have fallen much everybody talks about google's innovation. google glass. they get into everything. tell me a business google is not involved in. travel. as one of our sources said, google is like wayne gretsky, google skates to where the puck is going to be. apple used to have that reputation. liz: google has very intelligent people there in some different areas whether health care or
maps. number three used to be number one. >> apple. won three years in a row. that is unprecedented. we've done it nine years. nobody company has ever done that what is interesting how much this company was loved for three years. it could do no wrong. investors would gush about pap apple. it was perfect. we find out it is very good company but not perfect. it has been run by humans. it has problems. one of the reasons, stock is down 40% since september that hurts. i think there are several reasons why apple has fallen to number three. one, it is losing the race on innovation. samsung has caught up with the galaxy phones, all right? second, they have had issues in the debate over cash what they are going to do with cash. they have had problems with regulation in d.c. and taxes. they have had a number of issues. liz: why isn't samsung on this list? >> they are or not list. liz: further down. >> up to 18 from 36. liz: very nice. >> shows you how much of a gain they have had.
liz: number two, we're getting there, folks. number two. >> disney. one of the most patriotic brand as your graphic said a few minutes ago. people like what iger is doing. i think they are running on all cylinders. they have the film studio is doing well. no big, bad mistakes. they bought lucas film. the theme parks are doing well. espn is gushing money. people like that. the number one most respected company according to "barron's" is? >> berkshire hathaway. liz: berkshire hathaway. >> i think mr. buffett deserves a lost credit for that. people talk about, they talk about strong returns. business acumen. long-term focus and plain-talking style by mr. buff fest. >> yeah. a little delayed. we had, we had confetti and music all planned here. >> do it again? liz: say berkshire. >> berkshire hathaway. liz: let's go back to, i'm interested in samsung because it made such a big jump up.
what was berkshire last year on the list? >> berkshire was number 15. that is the worst it has ever done. it was always in the top five until last year. liz: great to have you. >> thank you. liz: we love our bayh ron's brethren. david? david: coming up our interview with billionaire investor wilbur ross about what he makes of all the uncertainty what the fed is doing. whether or not that is influencing his investment strategy. liz: let's not forget home prices surging at the fastest pace in more than seven years. we'll take you to chicago to find out whether house something now a seller's market. pretty obvious it is. housing there after being stuck in the doldrums for years, how is it looking? ♪
manufacturing. the dow finished over 42 points lower at 14,932. the carlyle group is considering ipo of telecommunications provider commscope. they are talking to investment banks about possibly listing commscope as soon as this year depending on market conditions. a former tiffany executive appears to be less than sparkling employee. former vice president of product development allegedly resold merchandise taken from the luxury retailer headquarters in new york city for $1.3 million. she appears in manhattan federal court to face charges of wire fraud and interstate transportation of stolen property. that is the latest from the fox business network, giving you the power to prosper. [ jackie ] its just so frustrating... ♪ the middle of this special moment and i need to run off to the bathroo ♪ i'm fed up with always having to put my bladder's needs
ahead of my daughterer. ♪ so today, i'm finally talking to my doctor about overactive bladder symptoms. [ female announcer ] know that gotta go feeling? ask your doctor about prescription toviaz. one toviaz pill a day significantly reduces sudden urges and accidents, for 24 hours. if you have certain stomach problems or glaoma, or can not empty your bladd, you should not take toviaz. get emergency medical help right away if your face, lips, throat or tongue swells. toviaz can cause blurred vision, dizziness, drowsiness and decreased sweating. do not drive,perate machinery or do unsafe tasks until you ow how toviaz affects you. the most common side effects ardry mouth and constipation. talk to your doctor out toviaz. david: though we still don't know precisely how or when we do know that the federal reserve is going to begin under winding its
bond buying program as the economy shows signs of improvement. how are the best investors altering their strategies in response? liz: if at all? who bettory ask billionaire, famed investor, wilbur ross, chairman and ceo of w.l. ross. wilbur, thank you for dialing in. we know that the fed's shot clock is going to sound at some point. so that is an obvious given but does somebody like you say i have to move pieces around the chessboard, there are things i have to change, or strategies i have to renew or start? what are you doing in advance of what the fed may or may not do? >> what we did as a precautionary measure actually before the announcement was we had all of our companies get as much long-term fixed-rate money as they could. because we do believe that rates are going to go up and we think it is followish to try to wait until the very last minute or try to guess the exact bottom.
liz: can i just clarify, wilbur. does that mean you locked in low rates for all the debt that you owe so that you now have been able to keep these low rates at this point? >> we believe some a few of our companies did still have some floating rate debt because that is the nature of their business. it is structured on paper. but anybody who has been aale to get long-term access, we have done including one of our mortgage origination companies got a cmds off last friday. so we're fairly welcome pleat in that regard. david: wilbur, you've had a lot of interest in banks, various aspects of the banking industry. one other thing that the fed is doing is increasing reserve requirements. there are a number of other costs that may have to be assumed by banks. how, in what way do you think the banks are going to pass
those costs on to the consumer and how do you think the banks are going to fare? >> those are several questions. i will try to answer each separately. david: please. including ours have are very highly leveraged toward a rising rate environment. for example, bank of ireland, everyone hundred basis points increase in base lending rate adds well more than 100 million euros to their profit because the reality with most banks is that the asset side of their balance sheet is far more rate sensitive on a very short-term basis than is their liability side. so strangely one of the things that's good for banks is a rising rate environment. liz: sure. >> but you were going to answer exactly how those costs that the banks have to assume are going to be passed on to the consumer?
>> well, right now we're in a time period where the cfpd is being very, putting a lot of pressure on banks to cut spreads to consumers. so there is a real tug-of-war is going to be between the banks, as i make a decent return on equity and the regulatory pressures being put by the consumer protection people. so it is going to be very interesting to see how that hand plays out over time. the other costs that banks will have to pass on in some way are the regulatory costs. most banks, at least doubled if not tripled or quadrupled their regulatory overhead due to the panoply of sarbanes-oxley and n particularly the pressures put
on by the consumer protection people. liz: well our viewers love to hear these thoughts and they also love to hear where in whatever environment we face you will be investing and we find it fascinating that you're looking at banks in a region where unemployment is higher than 20% and that is spain. what are you looking for in spain? what are you investing in in banks there? >> right. well we haven't actually put any money to work yet. we've been talking with a lot of the banks and with the economy. what we like about spain is that it's a real economy. they really do make products. they really do export them. their productivity per unit of labor has gone up very, very dramatically with various new rules that they have put in. and as a result their exports have been booming. in one recent month they had a very positive trade surplus and
so we think that the spanish economy is going to be helped a lot by the rule changes on productivity. david: wilbur, let's bring it back home if i could and talk about coal for a second. we know that somewhere close to 40% of all of our energy comes from coal. i guess it is about 37%. the president obviously doesn't like coal but he didn't hit quite as hard as a lot of people thought he would in his speech a couple weeks ago. have coal prices just about hit their bottom? is that a place to look to invest right now? >> well, what's interesting about coal is that coal from america is now being exported to europe in pretty large quantities and the reason is, very strange one. natural gas prices are several times as high in europe as they are here. so it is actually cheaper for european utilities to pay the
cost of importing american coal, across the ocean, rather than paying the domestic price for natural gas. the reverse is true here. natural gas is not only less pollutive but is less expensive per btu than coal. so what's really happened with all the anti-coal regulation is that steam coal is still being produced, it is still being consumed. it is just being consumed in europe rather than in the u.s. david: interesting. some good bets from wilbur ross. wilbur, thank you so much. we really appreciate you chiming in. >> thank you, bye-bye. david: good to talk to you. coming up the nasdaq is fighting back against claims it fumbled the facebook ipo last year. charlie gasparino broke the story. he will be back with just the very latest. ♪
facebook ipo. nasdaq, i think it faces nating how an exchange, a modern exchange defends itself. it admits it botched the ipo. it says small investors really have no standing to sue it. small investors lost money in the botched ipo, as you know a lot of people lost money. they say they have no standing for number of reasons. number one, there is no contractual relationship between the nasdaq and investors. investors don't trade on nasdaq the brokerage firm bought it from the nasdaq. they're one stepped remove. they're an sro, self-regulatory organization. guess what? we went forward with thing and it may have caused damage. we went forward because we believed that was best for the markets. guess what, we're immune to lawsuits like this. number three, they're saying listen, investors filed in their class action that, there was fraud involved. there is no fraud here. this was a screw-up. those are basically, listen, i read the stuff. i read it fast. that is where i think nasdaq's
three main arguments come down. whether a court goes for it and throws it out i can't tell you. i called the plaintiff's lawyers. they have no comment. nasdaq tells me they won't comment on litigation but it is kind of an interesting step in this embreault yo that began last year when facebook put out the ipo, much anticipated. bob greifeld, head of nasdaq, ringing opening bell. big fanfare and went south from there as you know. david: charlie, i'm wondering we're in the midst right now of a lot of new ipos being issued as a result of the improving economy. do you think this decision will have effect on ipos, particularly on pricings of those ipos? >> no i don't think so. all the exchange worry about technical glitches on their watch with an ipo it become as big issue if people lose money. nasdaq reacted to the ipo in a way you think they might. they tried to contain the legal liability both from class action
and on the street. major brokerage firms threatened to sue them. they came up with some may, i understand some still are. but they did take the technical steps to make this thing better. liz: we should mention that when the news broke the stock was down half a percent. by the end of the session it was almost flat. it came back. thanks, charlie, very much. david: thanks, charlie. we should mention tomorrow it is half a trading day because of the july 4th holiday. we'll come on early at 1:00. in fact we'll be led by liz coming on early as well. she comes on at 12. we're here tomorrow at 1:00 p.m. don't want to miss is it. liz: noon eastern. you don't want to miss it. money with melissa francis is next.
melissa: i'm melissa francis and here's what's "money" tonight. running out of time and running out of options, egypt's president has 24 hours left to control the chaos or the army will reportedly push him out. four people are reported dead and u.s. embassy in cairo is preparing to shut its doors. are we witnessing widespread revolution? plus you may as well save time and hand your checking account info over to a thief. a little-known practice by banks could leave you dangerously exposed to fraud. we'll tell you why and how to protect yourself. and, "who made money today"? here's a hint. they're doing figure eights after scoring the best month in year. can't figure it out? keep watching. even when they say it's not, it