Morning to the 30 year, getting closer to four. As it climbs up, that could present problems for banks in a lot of different ways. And the dollar versus the yen, even though i have switched entirely to bitcoin, ben bernanke and paul krugman are still big users of the dollar and not into the digital currency. Blog postposted big saying it is evil and reportedly a letter from his College Roommate saying why it does not work economically. People one of the many sticking with the dollar. I guess there are others. Lets look at the top three stocks that im keeping an i on this hour. One of them is disney, trading at a record today. Analyst raised its looking at its. Obust content cycle crocs as well. Blackstone is buying a 200 million stake in the company. They will turn around and buy back shares with that. Was supposed to be acquired by apollo tires of india. It is now canceling that acquisition, because the two parties had trouble getting financing. Now they are suing each other over it. Cooper was lower earlier and now it has turned higher by more than 5. 5 . Now onto the big story today. With six weeks to go before this sochi olympics, terrorism is casting a shadow over the winter games. At least 30 are dead after two days inbombings in two the same province as sochi. There are new concerns over security at the gains. Lets bring in our panel of experts to discuss that issue. Rick nelson is senior associate at the center for strategic and international studies. Is here, andin fred burton is Vice President of intelligence at stratford. He helped arrest a man behind the trade Center Bombing back in 1993. Thank you all for joining us. Lets turn to you, fred. Look at this situation, there has been a lot of talk about security, not just at the games but elsewhere in russia, surrounding the games. Someone who has had experience securing an olympic games, what do you think russia can do our needs to do in this situation . Its going to be extraordinarily difficult to secure the transportation hub leading in and out of the olympic venue. Having protected olympic athletes at these kinds of events before, the focus will gear down toward the Olympic Village to make sure that the athletes are safe. It really is a daunting challenge to try to just secure the perimeter and the infrastructure leading to and from sochi. Let me bring in kimberly. Russians, as opposed to what we have to deal with in our free country here, they can just throw people in prison whenever they want, accuse them of tax evasions or get some punk rock girls and throw them in a work camp. Theyre putting so many resources into protecting sochi. Putin has a personal stake in making it work. The person who leads the is aern Federal District very close food and ally. So everyone has a strong interest in making sure that andrity in sochi, moscow, st. Petersburg works well. My biggest concern is about rush outside of those areas. My concern is for the russian population, not the foreigners coming in. So they could hit a soft target a few hundred miles away. They will pick another city to hit or another set of soft targets. Theyre protecting train stations, they could hit soccer fields. Who knows what they will do next . Greg scheuer talking about a country where there is a certain ability to restrict movement, for instance of people or to jail people if that is needed. With a focus on sochi, how do you see these type of terror acts happening . It has been talked about a lot that there would be issues outside of the area where the olympics are being held. This is a very potent situation where these terrorist groups this particular instance, you have some groups that have had a low level conflict with russia for over a decade now. Iny have a visible target the sochi olympics and at the same time they have the rest of the country which may receive less protection because russia is still focused on so she. Quite aians are in security conundrum here, even though they have extensive capabilities. Put it into context for us, fred. When we think about terrorists, we typically think about qaeda. What kind of terrorist are we talking about here in russia . Looking at the kind of attack that it is feasible we will see continue, meaning it looks like until the russians hunt down the actual bomb maker with the forensics linking the two blast, that is going to be critical. First and foremost that is on their minds. I can tell you firsthand the challenges, for example in atlanta, the bomb went off outside the security perimeter in centennial park. It is really difficult to clamp down all of your soft target sets from hotels to buses to any other kind of mass transit going in and out of the city. So who are we talking about, really . It is not al qaeda that is causing problems for Vladimir Putin. They have their own slew of terrorist organizations in the area. One group has been fighting in the chechen insurgency for 15 years and is now heading up the islamic insurgent group. It is not very well organized. They are loosely organized and he has called on his followers to do everything they can to disrupt sochi. One thing important to keep in mind is that the russian government is only going to allow people into the sochi area who were on the official government approved list. Its going to be difficult for outsiders to get in. You were talking about how putin can throw anyone in jail. One of the things that has made the insurgency last is the antiterrorist techniques have been so violent and indiscriminate that you have a Large Population of people throughout the north caucasus who are feeling despair. That adds to the potency of the cost. It is a tactic that you would try to increase these terrorist attacks to increase the crackdown, and then increase the sympathy. So it is a tertiary effect that could be a goal of this. I think youre absolutely right. My concern is it will lead to a massive ethnic conflict after the sochi games. Putin is going to be reluctant to make any mistakes, but then afterwards, to keep himself in power and reassure his closest supporters, he has a strong incentive to take up the cause of as nick russian or nationalism. I am concerned about the long term consequences. Can the International Community offer or does it want to offer Vladimir Putin and russia any help in this . We have obviously dealt with these issues before. Intelligence and assets that we could add to sochi. Are we going to . We will be looking to protect our athletes and those of the International Community. The problem is twofold. Russia has not always been willing, open, receptive to getting u. S. Or Even International assistance on these times of manners of matters. Direct there are not threats to the u. S. Or the u. S. Interest, we do not have the depth of intelligence as we would with other targets. , ifimberly, very quickly this scenario unfolds like you described in the wake of the gains, International Pressure has not historically made a big International Pressure. Theres not much the International Community can do at this point because putin has made it clear he is interested in only limited cooperation with the west. Russia has Nuclear Weapons and a veto at the un security council. In themits what anyone outside world can do inside russian territory. It aswill keep an eye on we get closer to the gains. Up, the best performance of this recordbreaking year are next. Plus, hightech on the high seas. The Worlds Largest solar powered boat is coming up. 2013 has been one for the record books in terms of stock performance. Julie has been compiling the stats for us all year long. Do you have a book where you write every single Closing Price . No, sorry. That seems a very tedious. I have been using my handy dandy bloomberg terminal. In terms of records that we are looking at, it is the biggest outperformance for stocks over as fare we started as our data goes back, to 1978. The s p up 29 , treasuries have returned or lost 2. 3 . The market cap for the s p 500 is up 2. 7 trillion this year, the biggest ever. It has been a good year for stocks. When people look at their end of your statements and realize they have lost money in bonds and it is that much it has gained momentum during the year. The amount that has gone in to mutual funds has not been as much as you might expect. The socalled great rotation has not been as huge. You have seen a lot of money go into stock, the most since 2000. It is split between mutual funds and etfs. Fundould think the mutual flows would be a more accurate reflection of what Retail Investors are going are doing. You still so relatively robust auctions,treasury partially because foreign governments are still buying treasuries and partially because a lot of people have to own them as part of their investment strategy. Charts isthe greatest looking at how gold has done compared to the last 13 or 14 years. Saying it proves all the austrians wrong and it is true that all you have to do is just cut Interest Rates and make do so much, and quantitative easing that you cant even sleep. For peoplely works invested in the stock market. The gold return is the worst since 1981. It has been a longtime since the gold bugs were this unhappy in a given year. Do you think it is because people were selling gold to buy bitcoin . Im sure thats what it was, matt. If you look at bitcoin, it is sort of the opposite. Coincidentally it must be equivalent to the dollar going into bitcoin. Somebody call them hard money clacks, the people that want guns, water, and goal. Now they could get guns, water, and bitcoin. You have to make it last now. Our closer says it is not just about the markets. Dont forget the progress washington has made this year as well. She is a top Portfolio Manager and she also ran citibank Global Asset ManagementValue Investment group. You are saying congress was getting along at the end of the year. On the day of the taper, markets boomed. I think that reaction in the market, the springboard was set by the day before, the announcement that paul ryan and patty murray had come to a bipartisan budget agreement, which is the opposite of what we saw at the end of the last previous two years. All of a sudden theres some optimism that if the government can get out of the way of causing these disruptions and economic uncertainty, then you could have a stronger economy. One of the big reasons for the lackluster recovery is the unwillingness of corporations to spend and invest in higher because they lack confidence. If you could get confidence in addition to the slowly recovering economy that is a lot of faith in the u. S. Congress. There are still a lot of things they will have to address in one would hope a bipartisan fashion. It remains to be seen if it is a trend, but it is something different. I think is the time of year when you are optimistic. Finish, thea strong strongest return of the s p 500 since 1997. We are saying maybe will take off and 2014 instead of crawling along like we did in 2013. Growth. Gdp shocking. Very strong growth. In a good way. Expecting maybe 3. 5 for the fourth quarter, which makes it a decent year. To taper insed september after having signaled it. We are sliding out of the new normal . I dont know what the new phrase will be. Think we will have fits and starts in the new year . What is your outlook for the first few months of the year in terms of the market . It has been consistently strong. Is also the lack of volatility. It has been a oneway street. It would make sense to have a correction, but going into next year, while the Federal Reserve has basically said the economy seems to be on a sustainable path, at the same time they are continuing a massive stimulus program. So it is the best of all worlds, thinking the economy could be firmer but the fed is still people who will see their bond funds and think, omg, i need to get out of stocks and get on the bus with everybody else, right . 2013 was the first year where inflows, thequity first year since the downturn. Even though we know this anecdotally and from clients, people are wondering whether or not to get in, and they are under investing. Hard to get in after such a strong year. Thank you so much, barbara. We will talk to you more later. Sailors use the stars , andvigate the high seas now the Worlds Largest solar powered boat is next on street smart. The Worlds Largest solar powered boat is an international creation, and we caught up with the ships captain. I am the captain of this extraordinary machine. It is known as planet solar. The boat was built four years ago in germany. The owner was seduced by the idea of doing the first world tour with the biggest solar boat in the world. It is a huge, floating solar panel. It isgo from a to b quite a challenge. It is good to have a partner like the sun because my personal energy is not sustainable. Bu grow re watching her you are watching street smart. It has been a rocky year for apple, but tim cook is still bringing home the bacon. There are a couple of parts to this compensation story. It is true that tim cooks compensation was up about 2 , but it was in part because of the stock performance. Lackluster this year. You probably recall a couple of years ago the board gave him a big vote of confidence, gave him a million restricted stock units, worth a lot of cash. They were going to invest half of them over five years and the rest over 10 years. To show his commitment to shareholders, some of those will vest annually. Because of the stock performance, he basically had to give up in the neighborhood of 4 million. In a year when Technology Stocks were pretty hot, what was happening with apple, despite all the big revenue and profit it was posting, everyone has an opinion on that. Notably, carl icahn, who try to put a lot of pressure on the company this year. He wants them to do a big buyback. Apple has not budged. Isck so now the company putting this on its annual meeting agenda. Itsate february apple have annual meeting. They told us late friday that on the agenda will be this carl icahn issue. The board saying they dont want you to vote in favor of the buyback, because there are a lot of things that apple could be using its cash for, perhaps better for the company longer term. Not to suggest they are not looking at ways to return more shareholder money. An interesting annual meeting to compare to last year. Now the focus is on carl icahn. At beginning of the year the focus was on david einhorn. In a lot of cases you have long term shareholders who would rather apples been more of its cash on some of these next week things. The challenge for investors is they are waiting for the next big thing in not exactly sure where apple is going. Know we are still a couple of months out from that. Are you getting any kind of feeling from shareholders or analyst or the company itself as to whether there is any real support for carl icahn behind this kind of buyback . To theecently spoke major pension fund about how it feels about all of this. It certainly did not suggest it is in the carl icahn camp. For the average investor, a lot of people are frustrated. They look at the apple story on paper and dont really understand why the stock is lacking. Whys never easy to explain a stock may struggle versus other stocks. If you look at catalyst in the reportrm, the earnings in january will show how all those new iphones that came on the market late in the year sold during the holiday period. It could change the story overall for investors. Of the investor, what have you done for me lately . Have failedle may to well investors, 2013 was a big year for google. Rage, glass was all the and the stock hit at a record high. In a rare interview, eric schmidt gives us his predictions for the new year. Im eric schmidt, executive chairman of google. Everyone is going to have a smart phone, and the fact that so many are connected to what is essentially a supercomputer means a whole new generation of applications. The trend has been that mobile was winning. It has now one. Won. As now the arrival ofut big data and machine intelligence. Find people and talk specifically to them, to rank what they are doing, to decide what to do with products, changes every business globally. The biggest construction that we dont know what is going to happen is probably in the genetics area. The ability to have personal genetics records and to start gathering gene sequencing will yield discoveries in Cancer Treatment and diagnostics over the next year that are unfathomably important. The biggest mistake i made it google was not anticipating a rise of the social networking phenomenon. In our defense, we were busy working on many other things, but we should have been in that area, and i take responsibility for that. Google is very much investing. We see strong growth all around the world with the arrival of the internet everywhere. In that sense. Google benefits from transitions and transitional injure industries you read even when things are tough in the country, it is smarter to move advertising from others to so we win whether the industries are in good shape or not, because people need our services, and we are very proud of that. How can we get the new systems deployed . We want to do that as fast as we can. Barbara, what is your outlook for technology as a sector next year . The stocks we were just talking about, apple and google, certainly are successful will have more successful products over the next year. There is some visibility there that makes you more comfortable. There is some spending ahead of we do have a stronger economy over the next year or two. Is one by one. It is hard to group them. There are probably some of each that would be attractive to would you be caught dead wearing google glass in public . That is a good question. They are not attractive. When you walk into a room with someone else wearing google glass, you either want that person to leave, or you want to leave. Up andt a bitcoin meet there were three or four people wearing google glass. It is a small subset of the population. 140 robots, one california will take you inside where the model is made. Plus, the genesis for many of this years most popular gifts. The 2013 year in review from tumblr, coming up. Tesla pumped out an average of 500 model s cars a we