This comes on the heels of the down side we saw yesterday with a loss of almost 200 points. We will get to all of it, including the weak data that came out of china yesterday that is scaring people today. Another headline we are following, in colorado,. This is huge. This is what they need to be legitimate. This is a Seismic Shift in thinking regarding marijuana, access to bank accounts, and access to lines of credit. Are the banks concerned they could be unwittingly engaged in criminal activity . A lot to cover. If the treasury says this is ok, it will be a big deal. Also, how the Biggest Technology companies spot big trends and hedge against future competition. Lets get to the markets. Havehe entire hour, we very ritz holds barry. Also, hans. You know a thing or two about Global Markets and what is happening as we speak. He has served on the Steering Committee of the private Investor Committee for greece and was the cochairperson for argentine bondholders. Barry, what do you think is behind this . People are saying it is all about emerging markets and concerns over china. Is it more than that . I think people like to tell a story. They like a narrative. They want to find something to blame for events that may have nothing to do with what is going on. We have gone over 400 days about a 10 correction. That is a long time historically. The market is up 160 from the lows. We have had 10,000 dow points gained. We are giving back 600 and people are wringing their hands. I know this is a crazy thought. Up,times markets do not go and people need to understand that. It seems we might be taking a breather. What accounts for this . The dow is heading for the worst week since 2012. What is going on . I have to agree with barry. Our world is more emerging market and international debt. There was a lot of buying going into year end, a lot of enthusiasm. It probably was not warranted by fundamentals. Our selloff is technical. The currency moves, there are stories behind those. Overall, it is a soft trade. Argentina is getting whacked today. What is behind the move to the downside for the peso . They had two Exchange Rates in the country. They are bleeding reserves by intervening in the currency market. The official rate was around 6. 5 . The blue market rate was around 10. 5 . At a certain point, they were burning reserves because they do not have access to International Markets for funding so they had to do something. The Bloomberg Global poll Found International investors are the most upbeat about the Global Economy than at any time in the last five years. Europe is so much better than they were just a year or two ago. Two years ago, we were talking about dissolving the euro. That is behind us. Emerging markets still dicey. To adjust what we were discussing, before the talk of startedr, before rates moving up, a lot of International Investors were plowing into emerging markets fixed income. Even though it was a higher risk profile, the yield was much better. Now if you could get 3 risk free on the u. S. 10 year, people are saying i will take the same yield but with much less risk involved. We are seeing a lot of money come out of emergingmarket fixed income and go into safer, than a few years ago. That is part of the turmoil we are seeing in markets. Are you worried about argentina and the effects it could have on other places . Not really. You have what looks like a rational action by the government in the midst of years of irrational economic management. This is a step in the right direction. It will take pressure off. It may be a sign they will take tough steps to get themselves integrated with the international community. Does the president have the Political Capital to do that . She reappeared after being sort of nowhere. There is a lot of political jostling underneath her. She may not have the Political Capital nor the aptitude to take the decision, but they may have anyway. Ken will i buy it cheaply and get a nice yield . Buying emergingmarket debt is not a great strategy. You have to look at the credit. If you look at venezuela, you can buy oneyear what are we seeing . Was the highyield people when it around 10 last year. Without the risks were outweighing the 10 return we felt the risks were outweighing the 10 return. The white is argentina. It is an interesting investment to look at now especially if you think it is not going to be problematic. Gary from Goldman Sachs is not worried about argentina. He spoke to our team in argentina. Take a listen. We have seen movements like this before. Onember back to what we saw the tapering speech last year. We saw 100 basis point movement. We have seen the 10year basis points move. We have seen normal reaction to things that go on in growth markets. These are growth markets. They are not developed markets. Who hasestion for hans the currencies, what does it do for the exports or the United States or china as a big consumer of their exports . Been one ofhat has the structural problems argentina has had with overvalued currency. The trade balance was getting killed. Theevaluing the chris i currency, they will get more competitive. They have been lying about their inflation for years. Who does not . Lets be honest. There is a scale of lying. At some point, they have this pentup inflation. By devaluing it, if they allow inflation to run away, that is a problem. Devaluing prudently is not a bad way to get is that to be expected given we are now in a different kind fedthreat environment environment with the taper expected next week . The dollar could theoretically become stronger versus all these other currencies. That does a couple of interesting things. You have noticed the higher yield in the United States the past couple of days. Not quite as high as they were. Maybe that is alleviating some of this fixed income trade going back and forth. Beneficial tor is the economies who export goods to us. It easier for people to sell stuff to us. We are the cleanest dirty shirt in the hamper. Argentina, the currency moves they are making, is it enough to win back investors . Good question. No. They have the outstanding judgments against them in u. S. Courts. There is the issue with the paris club. This is one step towards argentina starting to resolve a lot of outstanding issues with the international community. There is room for breakthroughs in the next few months. Certainly by the end of this year, we think argentina will have would you buy argentine debt . You are betting they will make the coupon payments. Thanks for your time. We appreciate it. Next, this unbelievable story. The u. S. Attorney general out with big headlines that could turn the pot industry into a legitimate business. Suppliers may finally find a home for all of their cash. A major step for the medical Marijuana Industry today. Attorney general eric holder said treasury and Law Enforcement agencies will issue regulations opening Banking Services to state sanctioned marijuana businesses. This is a big deal. Retailers had to operate on a cash only basis. I spent a lot of time reporting in washington and colorado talking to a lot of the people that own these dispensaries. Their biggest frustration was they had no way to transact. All caps, no credit cards. You paid with cash. They had to deal with the cash. They had to pay their employees in cash. It is not easy to keep track of. There is theft and shrinkage. Who wants to walk to the bank hearing 20,000 . There is the stigma it is like scarface. Assuming you can even open a bank account. This is an interesting tidbit. That money cannot smell, literally it cannot stink. E tone man was using febreez get the smell off of the money. If it does, it is over. You will lose your account. We talked about this issue. Let me play an excerpt from that interview. There are a lot of people basis. Ng on a 100 cash unaware people who have been through over 20 banks in four years. I am aware of people who have been through over 20 banks in four years. How many have you been through . Two. For four years, we had no problem with our bank. In may of this year, they sent us a letter saying because of recent federal pronouncements, were giving you 30 days and shutting down your account. Is it wrong i expected that to be in a smoke filled room . Do you think i would do that . After the cameras. I think that is still the stigma associated with legal marijuana, that even juvenile idiots like me are still waiting for that smokefilled room. It hass changing because become so prevalent in colorado. It is increasingly normal. How can you have a business when you cannot even open a bank account . That has been holding the industry back. You mentioned banking. What is in this for the u. S. Banking system . A lot of money. It takes something that was a oftibilliondollar segment the cash and commodity business of of the but market out the black market into the sunlight. You know what that means . Taxes. Look at how many people are in prison today and the expense of maintaining people for nonviolent marijuanarelated crime. That is where attorney general eric holder was going in his speech yesterday. Maybe the effort needs to be geared more toward violent offenders as opposed to this. Instead of being a cost, it is revenue positive because it is being taxed. I can say this will make a big difference to a lot of these entrepreneurs trying to get their business off the ground. There is an estimated 500 dispensaries in colorado. Taxes on Recreational Marijuana are significant, in the range of 25 . The state stands to gain from this. If you are in an all cash business, i am not saying they are not willing to pay the tax, but one can imagine a situation in which maybe not all of that money is reported. Today the governor of colorado put out a statement. Hes obviously in favor of this. It brings this out of the darkness into the light. As the gentleman you just interviewed, they will find some place to park their money. There are so many more issues. There are safety issues with that much money on your property. You move to checks, legitimate accounting and bank accounts. It is not just colorado. It is washington state. California has medical marijuana. We are going to see this expand across the country. I think you are right. Good for dorito sales. That is good. Time for the davos global outlook. We will look at what has been going on this week in the swiss alps as the movers and shakers meet. One of the topics was income inequality. The business in davos when we return. Welcome back. We want to focus on the World Economic forum underway in davos. Were joined for the hour again by Barry Ritholtz. The question for this segment is, is davos relevant . Y. Lets ask barr why are you not there . It is an eighthour plane ride and sixhour train ride. I have stuff to do. There are important people. You get to shake a lot of hands. Networking opportunities. Unlike new york city, where there is nobody important. Quote aboutn had a going to davos. He describes the for him as a constellation of egos involved in of self adulation. There is something to that. The filipino billionaire said something similar. He said it is loaded with bloated selfimportance. Im here to do business not save the world. If someone promised me i could hang with bono, it might be worth the trip. But im not going to spend all that roundtrip time. They have classes of areas. I am not excited about being on the other side of the velvet ropes. Theres something to be said about these wealthy people talking about income inequality. Shilleress, robert still thinks it is important. That is what he told us. Take a listen. The Business Community is not always idealistic, but the people here are on the idealistic, socially conscious side of business. That is the future, i think. We need people like this. Ok. I love bob shiller. He is one of my favorite yale economic professors, one of my favorite economists in general. But it begs the question. If you have the ability to make those changes in your company, you do not have to go to davos. Marc made a good point. He said if you really wanted to help society, why not hold it in a place why switzerland . Why not detroit . Security in davos is supposed to be outstanding. They are concerned about protests and this and that. If you really want to do good for the world, maybe you could hold it in a place somewhere the food is great. They hold the sundance film festival. They do not take that to detroit either. There are reason why these to go to why you get these exotic, beautiful places and hobnob. At sundance, they are not talking about income inequality. Some of the movies are about income inequality. A lot of deals are done at sundance. I promise you more deals get done at sundance than davos. Is just athink davos photo up or something gets done . It does not hurt for people who do not get to see each other on a regular basis who are Running Companies and countries. I do not want to be too negative. It is fine they get to mix. A lot of positive things come out of it. At a certain point, it is funny to watch people take nice planes to talk about income inequality. A little hypocritical. I will not go that far. It is amusing. That is probably the nicest way to say it. Youre very diplomatic. If i were more diplomatic, i would be there. Markets get to on the. It has been a rough day on the markets. The dow is down 275 points. The s p is off by almost two percentage points. The nasdaq is off by two percentage points. All of the subsectors are in the red led by industrials, materials, and financials, all down over 2 . One mover we want to highlight is texas industries. They are and parliamentary talks to be acquired by Martin Marietta according to people with knowledge of the matter. An agreement could be out as early as next week. Texas industries has a market value of a most 2 billion. Welcome back to street smart. 30 minutes away from the closing bell. I am mark crumpton. I am trish regan. A lot of concerns about the Global Economy causing a steep decline in the dow. China, othert emerging markets around the globe. Google announced it will pay 3. 2 billion to acquire another company. Some have said it is too expensive and evidence of a bubble in silicon valley. Can you really put a price on innovation . Just today, the ceo told why he sold to google. We have been producing new products. We have wanted to roll them out to multiple countries. There are 96 countries where we do not sell. We cannot get there fast enough. Going with google, we could get and access to resources to allow us to move these products around the world more quickly. As a small start, you have to build all of it. Of course, the 3. 2 billion did not hurt. Barry ritholtz wrote about the deal. Googletained the risk to is not the cost of such acquisitions but the potential risk to the core business down the road if failing to do so. We will hear more from barry on that. Also joining the conversation from San Francisco, cory johnson. Barry, lets get back to your thesis. What is it . Google is criticized when they do these big acquisitions. They bought youtube for 1. 65 billion. People screamed. The stock price paid for the youtube acquisition. Youtube now throws off 5 billion in revenue according to variety. We heard the same thing about google buying android. Their thought process was we do not want our core business of monetize and search with advertisement to be eclipsed by somebody else moving into the mobile space, so we want a footprint in that. This has worked out fabulously well for them. Some smaller acquisitions worked out well. Some of the more technical technologies they bought, all have served a purpose to not allow them to be eclipsed by a thirdparty. Cory johnson, jump in. The Smart Home Market is promising, but it is unproven. What is googles intrigue going to do . Is a promising . I do not think we know that. They have spent a lot of money on acquisitions. Some have worked out fabulously. They paid relatively little for android to get what they wanted. Is of googles strategies they point to a couple of successes far back in the Rearview Mirror such as youtube and so on. They say that turned into something for us. They spent so much money over the years. The other part of the strategy is they say we were not buying the technology, that was a manquisition. I have talked to the people at google about this. They tell us we are basically paying 1 million per engineer. It seems ridiculous. They all have very different ideas. What is interesting about the est d isel is n they are looking at the data that comes out of the homeal. The selfhe nest, driving car, and google glass. Two or three of those are interesting. The self driving car makes a lot of sense. I think the google glasses are ridiculous. But they all give google data about how people use information. That is what they are after. Do you acquire it or build it . That is a good question. We look at things google has tried to build themselves. The google dongle, nobody even knows what that is. You can spend billions of dollars and years building you make thisor acquisition. The guys who built nest are behind the ipod and ipad, so youre getting the cream of the engineering talent in silicon valley. That is number one. Number two, this is a known product. I agree the data is interesting. But i also think google is playing defense saying at some point in the future, smart homes, smartphones, smart cars will be important. This may tie in with the robotics acquisition they made in boston. They want to have a footprint in the future. This is the classic dilemma of build it or buy it. Google has wrestled with it. Google had a huge center in australia they shut down. Released are creating startups. I think what they are looking at is a much bigger vision of a couple of places where advertising will be relevant. They recognize it will not be on the desktop anymore. These things are going out the window. Ou have to be on phones they will try to figure it out early. This is a 3 billion selling off more than 5 billion a quarter in free cash. It is pocket money. That is where you are wrong. You are saying the nominal cost does not matter because theyre rich. I have relatives who make less money than me who say the same thing about me. It matters. If you waste money, you will not have full pockets. I do not think they are paying too much for nest, but i do not think they can pay anything for anything just because they have a lot of cash. But in the grand scheme of things, 3 billion to have what looks like the most Promising Technology years and footprint in the smart connected home already up and running, proven, not a concept to be developed as an investor, it does not make sense. As a defensive move from a company who is horrified of being blindsided, it does make sense. Less than 10 times sales, why not . Cory johnson joining us from San Francisco and Barry Ritholtz in the studio with us. Thanks so much. Did you see how much money jamie dimon made last year . A little bit. 20 million last year. That is 20 million more than i made. Is that like a commission . About ceooing to talk pay and how it compares to athletes and actors next. A big selloff on this friday afternoon. The dow is off 1. 6 . The s p getting hammered as well. Concerns about global selloff on the heels of the china data. We talked about argentina earlier. Lots going on. Lots to cover. Right now, executive compensation. Someone is doing well. His name is jamie diamond. He got a big paycheck last year. Raisean gave him a 74 bringing his compensation up. It is a lot of money. But interestingly, it is not as much as some people in other sectors. , for downey, jr example. 75 million. Did you have any idea he made that much money . Do you know how much ironman 3 grossed . On, there are 100 other guys that can do what he did. Looking at a franchise with actors who are wildly paid, it is not because they have a board of directors who are buddies giving them a nice check. It is because they deliver at the box office. If they stop delivering, they no longer earn a paycheck. Point, why the hue and cry over bankers . We are still a few years out from the financial crisis where the banks were in the midst of that. Nowback question mark doubt. That will hang around a few more years. Many of these banks had been bailed out or received government assistance. Like, we rescued you, and you think you are worth 20 million a year . Do not get me wrong. Banking is a good business, especially when rates are low and money is free. You do not have to be a genius making money running a bank. Shareholders say we like this guy and want him in the seat. When the overall market is up 30 , no one complains about compensation. Suddenlytide goes out, you will hear more criticism about bonuses and salaries. How does executive pay affect a corporations profitability . Jpmorgan generates almost 100 billion in revenue a year. They make 25 billion a year. They pay 25 billion in fines. The public does not make that distinction. 5 billion a year in fines over the past five years, collectively 20 billion. His salary . They probably spend more on pencils or toilet paper. People are angry. , larryk at other sectors ellison, huge. Company ellison build a from scratch. He is a billionaire and not because of his salary but because of the value of the company. The president only making 400,000. If he could throw a fastball 100 miles an hour, he would make 24 million. Alan krueger was with us and said you get what you pay for. I wish that was true. The yankees are the greatest example of that, the richest payroll in sports. You know, they have not made it to the world series in a while. There is soeresting much negativity surrounding the Financial Community and pay where you do not see it in other sectors. It gets back to what you said earlier. People are still reeling from 2008. There is no doubt there is a hangover from that. There is no doubt the Banking Sector is held to a different than energy, technology, even consumer goods and retail. Very different set of standards than banks. Area recalls, to be continued. This compensation story will keep going on. Stay with us. We will still be talking about it. Federal regulators are starting to scrutinize Warren BuffettsBerkshire Hathaway. We will have that and more when we bring you stories you may have missed, next. What do you think you say in a concession speech . He was not thinking he would lose. He probably did not even prepare a concession speech. Romney behind the scenes, netflix. Netflix is airing the documentary called mitt. It is a look at mitt romney. It follows him for six years as he makes his bid for the presidency. Is very compelling behind the scenes stuff. It is very interesting. One thing that is also the filmmaker on netflix. There is a limited market for talking entries. How many people are going to the theaters for documentaries . Netflix is a good way to distribute this nationally. You saw their earnings the other day. Stock went through the roof. They had 44 million subscribers versus the 31 million that had been anticipated. More people are signing up for netflix. It seems like a Promising Business opportunity. Is there anyone on the horizon who can compete . Apple, amazon. The question is what the net the trial of the rule will do to their overall ability to stream. Are we going to have to pay a higher tier internet subscription to get streaming movies over the internet . Right now, it is an allyoucan eat system. If the rule is not dealt with, it is a potential problem. One of the other stories we were looking at today concerning warren buffett. Federal regulators are crude rising Berkshire Hathaway are scrutinizing Berkshire Hathaway. The goal is to determine whether berkshire is too big to fail and needs Federal Reserve supervision. Is it . They are certainly not a bank. They own a big chunk of wells fargo and american express. They are a big reinsurer. In some ways, they look like a large hedge fund. In other ways, they look like aig without the excessive derivative underwriting. The question is one of size. When anything gets that large, are they potentially problematic to the overall Financial System . I honestly do not know. We were looking through some of your research. You have been saying you have to watch the nfl. If it starts talking about ipo . Concession concussion settlement go to the judge and the judge kicked it. He said it does not go with enough of a reserve. There are too many former players who are potential litigants. The award is not even going to pay for their medical bills. There are talks the nfl is looking at an ipo. That tells us the liability on concussions is greater than anyone imagined and they are looking to cash in on the public. Fans would love to own a piece of the nfl whether it is a good investment or not. It is an emotional purchase. So far, it has been good. If they are a seller, i do not want to be a buyer. That our went by fast. Good to see you. We have more street smart. We are heading into the close of trading. We will be back. Welcome back. I am trish regan and we are about to close out the week. You have the biggest weekly decline since 2012. Thes due in part because of massive decline in emerging market currencies. The argentine peso getting killed today. A lot of concerns about china. This is the third day in a row about concerns on china. I have been talking with guys in finance after work in certain social areas. They have been voicing concerns. Steve was warning about this a couple of weeks ago watching odd movements in chinese bond sales. He said you have to watch out. This could be a warning sign. Matt miller, glad you could make it. Lets get to our top 10. Microsoft jumping nearly 3 after posting record sales for the second quarter. Companies flocked to the xbox and tablets helping to beat analyst projections. Shares falling about six percent. The makers of the robotic surgery device says revenue decreased by 23 from a year earlier. They partly blame the sales drop on uncertainty over obamacare. I had one of those used on the. It is cool. Apple is down as the iphone maker steals the market share from saintsaens samsung. Samsung has been struggling to keep up with apples appeal. Honeywell down despite posting fourthquarter profits that beat analyst estimates. 3 ,tarbucks up nearly gaining the most in nearly six months after reporting earnings that topped productions. Seasonal drinks helped to boost your sales. Down almost 1 . They may split off the paypal unit according to people with knowledge of the matter. The Tech Companies facing an activist investor. It brings in the question of where paypal is more valuable. They have 6 million in revenue compared to the rest of the company that has 8 billion in revenue. The question depends on who you are. If you are the ceo, it is more valuable at ebay. They are still making a lot of money off of ebay. It is not just paypal. Were going to make the bell. Following 5 after the drugmaker said it was not ready to move ahead with the study of combination cancer treatments. It has been putting a big effort on cancer drugs after a strategic overhaul last year. Plunging the most since 2008. Theoperator reported revenue fell 17 . Juniper rallied 6 . Shares were upgraded by at least three firms this morning after fourthquarter sales that exceeded analyst estimates. Here we are at the number one stock of the day. Procter and gamble, a bright spot in the declining market. Climbing 1. 3 . Sales rose in emerging markets. Were coming up on the closing on this friday afternoon. Up 37 points on the s p. Plus points on the dow. This is the work since 2012. You have equities slumping around the world, big emerging market currency selloff. The argentine peso really getting hit today. Extending the worst slump since 2009. For the marketff on concerns of where this Global Economy is heading. Is at the level it was in middecember. This wasof people say needed. This was a market that was on fire last year. If you get a market up 20 , it is only natural that people will take a little bit off the table. This might be long overdue and they were looking for an excuse. Everyone is looking for an excuse to sell. Is thi were looking at 2014 growth numbers. Everything resets. You have to wonder what is fundamental and what is purely technical. We broke the moving average. We are now below 1800. It can be significant in the actual number. Finally taking advantage of volatility. Like the vix over 15. But still relatively low. It had a breakout. True. Where is the fear coming from . Headlines to the thinking the selloff was coming from emerging markets with currencies selling off. We had the week manufacturing data out of china. We put the question to gary at davos about how concerned he is about the selloff on the argentine peso. He said he thinks it is normal market moves. If nothing else, it provides an excuse to sell. If you have been looking for an excuse, this is it. China, turkey, and argentina are providing it. Time to round up the stories were tracking ahead of mondays open. We have a special guest with Olivia Sterns and alix steel. You are talking about the payday jpmorgan gave jamie dimon. How would we all like a 74 raise . After a 50 cut. And legal payments. It dont forget about that. It was 20 million last year, faultedo when the board him for his oversight of botched derivatives. The New York Times broke the story before the information came out and it was interesting to see what was behind the word decision. Insultdid not want to him and others were afraid if they went too high, what would that say to regulators . Not necessarily a conviction of, you did a great job. Here is your money. He is the fourth best paid ceo. Nearly 50 made million. A lot of that was stock. [talking over each other] jamie dimon is making half as much money. If you get punished in 2013 and your 2012 salary is cut in half, dont you expect want to 14 to be getting back to 2012 levels . , it is getting back to normal around 2008 and 2009. It is still a lot of money. This just goes to show that that later s money ost that the reason it was slashed was the london [indiscernible] there are other perks. I bet he does. Anniversarythe 30th of mac. Tim cook said that with abc and the interview will be released tonight. Or 800 emails00 daily. He said series the majority of majority ofads the them. And weeports earnings will discuss those earnings. Years, nobody buys the mac anymore. I do. You buy the macbook. Like the ones looks early bloomberg terminals. Over 60 million iphones. This is a product that has changed the world over the last 30 years. They have done a great job on their homepage. A great splash, the video in the background he reads 700 or 800 emails a day . Dont you . No. [talking over each other] takes that time. Now it will go to 3000 because now they know he reads the emails. Henow from experience that will occasionally respond to those emails as well. Ceo of j. Crew does that as well. They can read millions of dollars i bet he does. Know the ceo of tmobile, john leger the maverick of the mobile industry. He got to go on the ryan lewis show in l. A. Last night because he paid for it. He was kicked out of a party that at t threw at the Consumer Electronics show last month. Emily chang caught up with him. How pumped are you . Knowsbody that knows me im a huge macklemore fan and i will be right in the front row. Hopefully when he dives out and body surfs on top of me and i throw him back. It will be a big night. A huge macklemore fan. Saying he is a huge macklemore fan he is a great artist. But the bottom line is that he is shaking things up and all the right ways. He is in the press for doing the right thing not just with mobilemore, but with t with pricing and killing contracts. Rex i saw a commercial about we will pay for your fees and it was really cool. Why and when did tmobile get cool . Shirts doing it with his at macklemore. On draghi and steffi Graf Andre Agassi and steffi graf. What works is taking people off of their contracts. And they are getting into mobile banking. Put pricey will pressure on verizon and at t. , what works is for tmobile pretty much down market to begin with going further down market. Ask if they can pull a highend customer from verizon because they dont want contracts anymore, the customer will pay less and it wont be tied to contracts for two years. He is doing a great job of giving people a reason. We will leave it there. Ryan blair, great to have you. Colorado your favorite subject. It turns out you can put money in the bank right now if you own a pot dispensary. This is remarkable forgive me, you cannot put money but it is about to change. It is huge news for this industry. We will cover it next. Youre watching street smart. Im julie hyman. The selloff accelerating as the day progressed leading up to what was the worst twoday drop for the s p 500 since last june. Look at the action throughout the day. Chartg at the s p 500 here. You did not see a sharp drop off today. Just a gradual continued selling that we saw throughout the day. The catalyst for this is. Merging markets trouble concern around the globe. Argentina, you see the evaluation devaluation of the peso. Talking to a lot of investors over the past several weeks, a lot of them say that stocks are due for a pullback just like this. Add to that the lack of catalyst for gains in the market. The earnings report, as usual, we see the same ratios beating earnings per share and revenue, looking at the High Profile Companies has led to the perception of sentiment issue that has been hurting overall what we have seen in terms of stock action. Trish . Thanks, julie. If you are a california marijuana mogul, you probably have a problem putting cash in the bank. They absolutely will not accept deposits from pot dispensaries. It looks like this will be about to change. Eric holder said that the treasury and lawenforcement agencies will issue regulation opening Banking Services to state sanctioned marijuana businesses. We are joined by the executive Director Director of the drug policy alliance. This is a big deal. The number one issue with the Marijuana Industry as it he comes increasingly legal. These businesses are millions of dollars and having to take everything in cash. They go through the New York Times about the issues they are dealing with. For the treasury to say that our part of the deal you must regulate this in a responsible way why do we always use this rockers . Tattood punk we need a yuppie family passing around a joing. T. I was at high times festival. It will be more of a mainstream thing. Like having a glass of wine. People shift to vaporizers and middleclass people it is not the alternative set. I think it is time for new if you have a legitimate industry with banks that can accept the money, you will make it and credit card and debit cards. Lex spending time in colorado talking to these guys, their biggest frustration is that they have no way to deal with things like payroll. They have no way to deal with the money that they have. If they have a bank account, they never tell the bank what they are doing. They cant. We are in this multiyear transition what was this entirely underground market with criminals and Money Laundering and evolving it into an entirely legal industry. Colorado and washington are at the forefront. Others will be going next. I have been on your show slamming the Obama Administration but they are really acting in good faith. One of the things challenging in colorado is that eric holder will Say Something and the next thing you know, somebody is getting busted in colorado. They say they are going to observe the state law, but are they really . Congress needs to act. Igure out what they can do federal prosecutors still have some discretion. It is hard to say that the federal prosecutor cant enforce federal law. What might the new regulation look like . Tell prosecutors that if people are operating under state saying towill be state regulars and banks that as long as there is no reason to believe that this Marijuana Industry is involved in other types of criminal activity, it should be ok. It be anyuld different than someone operating a liquor store . Only because of federal law. Are there real parallels between this and the end of actual prohibition . Yes and no. But theed the way, states did not set up legal alcohol regulatory systems and allow it to be sold legally until 1933. Feds that wed the are out of enforcing it. California and colorado are more responsible. He could they are trying to set up a regulatory system. Public health, Public Safety issues. If the fed will not figure this out, we will regulate in a responsible way. They police the weed, watch the growers. Selling edible marijuana products, conforming with safety and health standards. Is industrythis imposed because they want to see it go legit. I dont know if i told you this story. One of the things i found remarkable was that when they accept cash in a dispensary, they take the cash and put it in a sealed bag. It is in a special airtight room because they cant let the cash smell. If the bank smellst h the cash, theyre done. How do they know what weed smells like . Its weed, thats why. Good to see you. This is a big deal. We will take a break . And we will be back with more. We havent seen a selloff like this since june 20. A big 300 point drop. First there was this Chris Christie i know that if we can do this in trenton, new jersey, maybe the folks in washington dc should tune in their tvs right now and see how its done. And then there was this Chris Christie. Mistakes were clearly made. As a result, we let down the people. Tose we were entrusted serve. I know our citizens deserve better. Much better. He is thought to be an obvious choice for the 2016 president ial ticket but bridge gate makes the future of the Republican Party uncertain. We are joined by daniel desalvo, a senior fellow at the manhattan institute. Its not that we didnt all know he was a roughandtumble kind of new jersey guy. But he is punishing his own constituents to take out a political vendetta, people dont like that. Clearly not. It has created a real problem for christie and brings to question his ability to manage an important state. Excited when i hear there are investigations and we will find out details. Knowledge of anything having to do with ordering more traffic. If anyone normal looks at the mustvet appears there been a plan set up that his deputy put into place. To speculate about what he knew or didnt know, he probably had to give the same speech or press conference whether he knew or didnt know. Now his enemy is new information emerging out of the subpoenas coming from federal prosecutors and inquiries by the state legislator. A lot of people thought he was the best hopeful for 2016. Has that changed . Lot. Think it has changed a the scandal will continue to dog him as fax trickle out over time. Beis a scandal that cant tied off quickly and will be a slowmoving thing over time. We will talk about Speaker Boehner and the jay leno appearance. A lot of folks in the Republican Party who do you think could be a good hopeful ge . There is a choice between governors and senators. Ofchristy was the leader governors with scott walker. Prominence battling Public Employee unions and show that they could effectively run important states. On the other side you have rubio, rand and it hurts funding for his campaign. We will be back to talk about the selloff and earnings, next. You are watching street smart. Im julie hyman. We want to talk about what happened in the markets today. It is the worst oneday decline for the s p 500 since june. It was the worst week that we saw since last summer. This is unusual. People got used to the market going up and it really stopped in 2014 as we see stocks tread water. This is the first significant decline we have had in quite some time. On a oneday basis, the worst since june. On a longer week basis, the worst in more than a year. Broadbased selloff. Industrials led the decline. But the s p 500 did selloff. Rigid winter is setting the price of natural gas on fire. Demand for gas has soared and stockpiles have tumbled. As freezing cold weather grips our country. There are three ways to play this arctic blast i should have said vortex. Eric, welcome to the program. Good to see you, because its friday. Lets talk about natural gas etfs. They really went off. Its not that we didnt expect cold weather but worse than we thought. One of the tickers that people turn to is ung, the United States natural gas etf. It is one of the best performers overall. It tracks natural gas futures and is sensitive to moves in the spot price. Longterm, you will get issues i will monitor this trade and not hang onto it. Explain exactly what that is. Monththey track the front future, they have to buy the next month. A lot of times it is more expensive. They have to pay up for the next month and it corrodes the return of the etf. Actuale natural performance. Across a number of different commodities am a but with oil and natural gas when there is a lot of demand, it has the opposite effect. Right now, there is yield of actually benefiting ung, but will underperform natural gas. One that is even more tactical is a velocity share three times long natural gas. This one went up 26 today alone and 62 in the past week. This is a tool that is very popular. 22 million shares trading about the same as xerox. The ticker of the week. Skyy. The First Trust Cloud Computing etf. It is up 31 and outperforming tech. It is tech. This is part of the new tech. This is growing and outpacing xlk. With social media and Cloud Computing companies, you will get a lot of those in the bigger and large stream etfs. It is interesting to point out. It is probably not a core holding but if you want to play the theme, this is an interesting one. Cloud computing etf. Who knew there was one come and trish . Trish . One, specially among the scandal. Apple, yahoo, facebook, amazon and google show us what theyve got, what we can expect from the tech giants. Of you guyse both here. What are you looking forward to . The first is apple. They are curious if the ipad sold better or worse than expected. I think that they will be better than people thought, close to 27 million. Iphone a little bit weaker than expected because the iphone 5c did not sell as well as people thought. Will that set the tone . Yes, because it is on monday and its size. The rest of the week, we will hear from the internet guys to see how big mobile was. To see what facebook is doing with instagram and video advertising. On iseople are focused best buy and amazon because of best buy. Because of what happened at best buy, down 30 they got hammered. Amazon show that they took it away from amazon. Do you think that amazon did it . People, including myself, were frustrated with the ups ordeal and not getting things on time. The best buy really suffer . I did a bunch of my shopping on amazon. I think there was a lot of turning from one to the other. The numbers to be different this week. Bitcoin on amazon and not best buy because of the gift app, i can buy things on amazon with bitcoin. I could buy victorias secret stuff if i wanted to. Youre probably right that the iphone 5c is not selling. I question why people arent. People might be opting for the 5s. That is a big upsell. 5s, its favoring the could work out for apple. And they cut production of the 5c, but its still a net lower number. They are also not getting into that market. A want to get to the lower income market. It is not a lowend phone, it is still 500 and 50. That is still too expensive 550. That is still too expensive. A lot of it is attributable to concerns about earnings. Is the Tech Community worried that they will not be able to keep up with valuation . There is a concern of how the stock it in 2013, especially the back half of the year. We are resetting expectations and we start to get little signs of production and expectations for the consumer this year. Samsung being the most recent one. They are more conservative about their march quarter. We think they are not making as many of the galaxy s5s as they would. There is concern with mobile products and i think that is causing a little bit of caution right now. We are seeing a peak of mobile technology and smart phones affecting the apple and 5c decision makings. That isung galaxy siii, probably still the most popular phone even though the s4 has been out for more than a year. How do how do you you compel people to go buy a product if they like the one they have . A larger screen iphone is one thing that might direct people to a new iphone. What about a curved phone . It is very much a gimmick. I think it will remain a niche product. It might remain fervent in a small sector. What if you have michael bay as your spokesman . Customers might flee the store. I wanted to ask you about the pc market. The cfo said that the pc market is stabilizing and michael dell told us that he thinks it is stabilizing. Is it still in such a horrible decline . I think the decline is not as bad as it used to be. At some point, things bounce off of the bottom and i think that is what is slowly happening. It everybody is buying tablets. You still have a pc in your home, right . There are still pcs being purchased. Stabilizing is probably the right word but it is not improving. The declining is a bit slower. Think with regard to microsoft and what they have done with windows 8. 1, the definition of pc is getting murky. When they say the pc market is its declining as much, are they talking about their tablets as well . Those are pcs as well. Water, microsoft in both markets. Its very odd. Thank you for being here. Nadalt all and fedor tennis legends took note. John mcenroe, coming up next. Back to street smart. We are about to embark to the Australian Open where rafa n adal and Roger Federer in one of the greatest tennis rivalries keep the stakes high and keep us coming back for more. The man with 17 grand slam rivalries a few himself. John mcenroe. You are the youngest man to ever achieve the number one ranking. Who do you think deserves that right now . The youngest guy . Thats tough to say. Hes not out there because these guys are too busy winning everything. , fore a Tennis Academy example. I have been looking, as well as the usta for the next Great American champion because we are not really doing too well. On the womens side, serena is the best player that ever lived. But we have work to do on the mens side. You have your Tennis Academy, nic has a big operation, bolateri. Were bums, right . Its just a lot more professional. You guys just partied. There is more education available. For all sports. Everyone thinks that you need to focus from 10 years of age on on one sport, which i dont agree with. The reason i succeeded, i think if you call growing up in new york city and going to school in normal life, i think that actually helped me. I think the chaos worked to my benefit. People dont think of that now. To thewant to go quickly bottom line, we need better athletes. Nadal is one of the best athletes to play the sport, one of the best athletes in spain. Theseic, murray, guys are getting taller and more athletic. We might need to get some of these guys playing in the super bowl or the nba. Richard takes it to a level i could not relate to. [laughter] federer said, speaking of sherman, that nadals grunt distracts him during matches. Pretty much everything distracts him. But i think connors and i went at it the most. Myself didntd like each other. Pretty much the way he is plucking his eyebrows, training trained it lendl just as hard as these guys. You are going to play the powershares series and youre going to play ivan lendle. Powershares is nice enough to get a group of legends or old fogies, we play all over the country. Absolutely correct. February 5 is the first of 12 in kansas city. Thwe go all over. He didnt play at all for 16 or 17 years. His eyebrows still look good. Im not going to go there. Are you just as competitive now . Butot just as competitive, for the average person, still ultracompetitive. In your 20s, it seems all that matters. I have six kids and a second marriage, and i hopefully will get that one to work. You put a lot of time and energy into other enterprises, the obvious ones i just mentioned. Randalls island, getting kids to play tennis. I compensate and try to get in front of the tv every now and then. More going on in your life that makes you slightly less i dont like losing. It is a hell of a lot better to win than lose. I grew up watching you and judy tate tennis jimmy play tennis. You were not quite as jacked as federer, or sleep in the thing djokovic does. Entourage. Oneman if i had a girlfriend or future exwife, it was preferable to having a bunch of people handing me things were saying yes for everything i did. I guess this has helped maximize their potential. You have a trainer and a masseuse and someone that pats you on the back and tells you how great you are. You have your coach and your parents. I love my parents but i did not want them at every tournament. Financially, the stakes are a lot higher in all sports. If you look at the money being made it all sports, it is crazy compared to what i thought was crazy in the 80s. And entourage i think i would have taken it a lot morey seriously. They were making more than normal people but they did not view it quite the same way. It is part of why it has changed. We are looking forward to powershares. Rex february 5 is the first one, we go to midmarch. Tell your billions of viewers that we need to get them out there you mean billionaire viewers. John mcenroe, thank you. More street smart back in two. More than 300 points lost on the dow today. A lot of concerns about the Global Economy right now. Argentina getting whacked and concerns about china corp. People say it is the market going up. Were waiting for a breather or a consolidation. Or a correction. That seems a strong word for a 300 point drop. Lex but we are also talking about yesterday. In the grand scheme of things, we are still near record highs. Will this destroy anyones 401 k . Obviously not. Dont you feel like we have this behind us now . [sighs] all right. We will see you monday. Have a great weekend. It is 56 past the hour which means Bloomberg Television is on the markets. Im alix steel. A brutal day in the stock market today. That dow closing down over 300 points. The s p was off by 38 points, below 1800. The low the 50 day moving average, the intermediate trendline they look at. The nasdaq the biggest loser, off by over two percent. It was a slow grind lower all day. , the largestk decline since june. It was an ugly day. Was it a pullback or is it a correction . That is the question going forward. One of the stocks after the bell we are watching is walmart, laying off 2300 sams club employees. That is two percent of its workforce. The biggest layoff for walmart since 2010. The goal is to reduce middle managers. Talking about the brutal selloff we saw over the last two days, i am joined by jeremy hill, principal of affinity advisers. Of caesar beware the ides of march. That day had no relevance until caesar was assassinated. The markets here, i dont think there is anything different about the factual status we are in today from a week or a month ago. What triggered this . We attribute it to weaker emergingmarket currencies and the bleeding in the u. S. , the decline in the 10 year treasury yield as the safe haven was bought up. Again, if you take a step back and look at the data. We had decent data out of europe. Im not suggesting the market is there is antinue real fear of a taper. I think we have shifted to a psychological market imbalance. We have talked about taper. We got ready to dance. We are pushed onto the dance floor and made a bogey. Fed policy is still in control. It is still about digesting the fed taper and preempting next week . That is one element. In the emerging markets, there are a lot of idiosyncratic risks, inflation, and political instability. These things carry over because people last year theyd a lot of money in the stock market. They think they should have a wait and see environment. The air comes out of the balloon a little bit. I am not in favor of calling today a panic because we didnt see a lot of indiscriminate selling. It was really a grind lower. You are looking to the weekend and looking toward next week. Is this the buying opportunity that traders had been waiting for . At affinity, we are a quant based shop. So a lot of this is noise. There are pricing issues we can take it vantage of. Next weeks statement is the big gorilla in the room as well as february 7. We get more taper and more selloff . The bond market with yields at the 270 level tom we have not seen that since the end of last year. Aboutd be pretty nervous those rates. Rex jeremy, thank you for intong that perspective. For on the markets, im alix steel. This is taking stock for friday, january 24, 2014. Stocks take a beating today. Our theme is to help you escape the madness. Usic can help you escape. We will talk about where the Entertainment Industry is heading and how much money they will make. With the snow and cold in the u. S. Northeast as well as other places in the Northern Hemisphere this week, perhap