MARIA-03
CEO Tillerson For Secretary of State; No Daily Briefings?; 2 Cops Shot In
Georgia; Anti-Terror Raids in U.K.; Australia To U.K. In 17 Hours; Lexus
Lights up; Trump Tweets On Russia RPT; Trump Considering ExxonMobil CEO Rex
Tillerson for Secretary of State; Trump Comments on "One-China" Policy;
"Star Wars Rogue One" Hits Theaters This Upcoming Weekend - Part 2>
Lauren Simonetti, Chris Stirewalt, Chris Wallace, Jeff Flock >
Guest: Kevin Kelly, Harlan Hill>
Movie Industry; World Affairs; Stock Markets; Donald Trump; China>
General Motors unveiling grand plans for the self-driving car. When the next generation of vehicles could start rolling out? That's coming up. Back in a moment.
(COMMERCIAL BREAK)
BARTIROMO: Good Monday morning. Welcome back, everybody. I'm Maria Bartiromo. Thanks so much being with us. It is Monday, December 12. Your top stories right now, 8:30 AM on the East Coast, President-elect Donald Trump administration is taking shape, sources tell us that Trump has chosen ExxonMobil CEO, Rex Tillerson to become the nation's next top diplomat, secretary of state, Tillerson plate could be very full right of the bat, amid questions over Russia election ties and the Iran deal, Trump is also making waves with his comments on the one-China policy this weekend.
(BEGIN VIDEO CLIP)
DONALD TRUMP, U.S. PRESIDENT-ELECT: We're being hurt very badly by China with de-validation, with taxing us heavy at the boarders, when we don't tax them, with building a massive fortress in the middle of the South China Sea, which they shouldn't be doing, and frankly with not helping us all with North Korea, why should some other nation be able to say I can't take a call, I think it's actually would have been very disrespectful to be honest with you not taking it.
(END VIDEO CLIP)
BARTIROMO: The very latest as the president-elect looks to fill several key cabinet post positions this week. Oil prices are rallying this morning, big time, take a look, non-OPEC countries including Russia over the weekend came together, agreeing to cut output in an effort to limit supply, markets is up 41/2 percent right now with 53.86 a barrel on crude oil. It's doing anything to equities though, the major averages coming off with another record week. Take a look. Industrial average will likely open at another all-time high, although the rest of the market looking a little tired, NASDAQ down a third of a percent right now, looking for direction.
One stock to watch this morning, Lockheed Martin, President-elect Donald Trump, just a few minutes ago, tweeting about the company's F-35 program, saying the F-35 program and cost is out of control, billions of dollars can and will be saved on military and other purchases after January 20th, Lockheed Martin shares are dropping on the news, this morning. This is of course after the criticism he had about Boeing. Jedi's rejoice, rather, the week has finally arrived, watch.
(BEGIN VIDEO CLIP)
UNINDENTIFIED FEMALE: The Empire is building a weapon capable of destroying an entire planet. They call it the Death Star.
UNINDENTIFIED FEMALE: We need to capture the plans if there is any hope of destroying it.
UNINDENTIFIED MALE: We want to help
UNINDENTIFIED MALE: All right.
UNINDENTIFIED MALE: How many do we need?
UNINDENTIFIED MALE: I'll be there for you.
UNINDENTIFIED MALE: The captain said I have too.
(END VIDEO CLIP)
BARTIROMO: The big year for Disney gets bigger, Star Wars, Rogue One, hits theatres this upcoming weekend, will you watch it? But will the first non- saga move still have fans feeling the joys and the force? Speaking of Jedi tricks, the company is turning the key on getting locked out by putting your keys in the cloud. We've got all the details on that, story you want to hear about. Then, may I have the envelope please? The Golden Globe nominations just coming out, hitting the tape we've got all of the details, tell you if your favorite star is getting the love right now.
Meanwhile, the stock market extend its rally over a month after the Trump election, the Dow Industrial closed at another record high on Friday, sealing the index's 14th record close since Trump's victory, Dow Industrial up 7.7 percent since election night, S&P 500 up 5.6 percent, NASDAQ composite up almost 5 percent since election night. Joining us right now the chief macro-strategist for GFI group, John Spallanzani. John, good to see you.
JOHN SPALLANZANI, GFI GROUP: Good to see you.
BARTIROMO: Last time you were here you said buy stocks, sell them on inauguration day.
SPALLANZANI: Yes, it was about 2190, I think you said.
(LAUGHTER)
SPALLANZANI: . I think that, you know, I think the -- remains -- it's still higher as we go to year end. I think that, you know, a lot of people put off tax selling until next year now, so that's another reason why, the trade is higher, people are below, investment in terms of chase for performance as we go into year end. So, I think a lot of things set up nicely. This week, we have obviously the fed, we have retail sales, so I think that right now we're taking a little bit of breather, that's why, you know, oil is up, energy stocks are doing pretty well, but over the broad averages unchanged right now.
KEVIN KELLY, RECON CAPITAL CIO: People shouldn't sell indiscriminately though, right? I mean they should pick and choose what they're selling on inauguration day as you're taking about. (CROSSTALK)
KELLY: With small caps that have done very well that actually won't hurt as much, given the stronger dollar environment we're seeing, given that they don't tend to export more. I mean, where should they be doing on inauguration day?
SPALLANZANI: Yeah. I don't think you're going to sell -- exactly on.
(CROSSTALK)
SPALLANZANI: Right now you have Trump who kind of says whatever he wants, but he's president-elect right now. I think that's why, we see the comments about Taiwan, because -- until he's president he can say whatever he wants about Taiwan. So that's really a chip for Bob Dole, who was kind of one only Republicans that really back him. So, again, you know, there's a paramount remove, really, on Russel, right. There's a -- materials. So we saw a lot of huge movers, right? Pre-election night the IWN, the Russell 2000 was trading at 108, you know, now up to 135. So, I would not be surprised if people took profits there on inauguration day. So, you know, really he has an agenda, and now, once he puts his hand on the bible, then it becomes reality, and he has to really see what he can get through, McConnell and Ryan.
DAGEN MCDOWELL, FOX BUSINESS NETWORK: Can you remember any president, that at least even before the inauguration that the markets had pegged-placed so many bets on? And -- because it gets tricky as Trump starts tweeting about individual companies, right? Boeing as an example of just the Airforce One project that he's not just moving markets, he's moving individual.
BARTIROMO: OK. Have we've seen this kind of economic growth plan out of any other administration, I mean, lowering taxes to the lowest industrialized world, rolling back regulations to the extent that it is going to take pressure off business, I don't know whether we've seen this.
MCDOWELL: Reagan in the early.
(CROSSTALK)
MCDOWELL: And with Volcker fighting inflation.
SPALLANZANI: The thing that people -- you know, if you go back and look at history, Reagan, I think, and -- before the election the market rallied 40 percent from March to November, so the markets started to discount that he was going to be the president, prior to that, so that was a 40 percent move. Then after he was elected, the market kind of went down, and down, to 1981, 1982, and then it really took off. So it was a 40 percent move from March to November for Reagan, and then the honeymoon was kind of a little bit over until he got into office. So, I think, right now, you know, the moves that we're seeing are, you know, quote, unquote, parabolic but not 40 percent, right? The S&P is only up, you know, 5 percent, since inauguration day. The Russel is obviously up 13 percent -- materials are up 20 percent, but in terms of overall market.
KELLY: Yeah. And the difference between Reagan's tenure is that he didn't have the house.
SPALLANZANI: Exactly.
KELLY: . as well as the governor.
SPALLANZANI: Trifecta.
KELLY: I mean, he's got everything going for him, in regard to that. But what he also has going for him is a fed that's backing him on his fiscal policy, we've seen governor after governor beg and plead for fiscal policies, that's why you're seeing the market move because they can't do anything more with their monetary policies. The only thing they can do is raise from here. And they also have four trillion dollars still on their balance sheet, so should investors be concerned about that, as well as their fix income holdings that should we start to see the fed balance sheet unravel that the prices over their bonds are going to go down?
SPALLANZANI: You know, I think it's a global phenomenon, right? So everybody is going from monetary stimulus to fiscal stimulus, that's why you're seeing all these elections go for the majority, really, for -- really, people want fiscal spending, right? They want lower taxes. They're done with austerity and everything else. Everybody wants a breath of fresh air. So, in terms of the bonds, you know, the bonds, the 10 year, 2 1/2 percent, right. We're only up like 20 bases points -- we don't have a lot.
(CROSSTALK)
SPALLANZANI: Yeah. The highest in two years, but this year, it's not up tremendously. I think if we're going to move over to 3 percent, you know, that -- that's big. But I don't think we're going to see GDP accelerate that fast until the later-half of 2017. So I think right, right now, bonds you're going to probably have a lot of guys who are going to rotate back into bonds, because, pension plans, that kind of thing. Because, really, you know, Japanese yields went up to .08 last night, you know, obviously -- Germany is still very low. So there is a lot of pension where it has to be moved around as well.
BARTIROMO: By the way, Lockheed Martin stock is down on that most recent tweet by Donald Trump. And, of course, we know that Boeing just did this deal with Iran, signing a deal with Iran to sell them 80 jets, even as we know, what, you know, what Trump said that he wants to do about this deal. This is a $17-billion deal, John.
SPALLANZANI: I think the interesting thing about the Lockheed Martin tweet, is the fact that he said he wants to increase defense spending, but doesn't want to be stupid about it. So we're going -- he's basically telling Lockheed and the other contractors, listen, we're going to give you cheat, right, we're going to increase defense spending. But, listen, you guys got to help us out as well. So don't think you'll get charges, you know, 20 billion from.
MCDOWELL: Allocation of money, though. We had that report that was leaked about the $125 billion in waste in the defense department.
SPALLANZANI: Oh, yeah, exactly.
MCDOWELL: Where we have a bigger logistic department with the U.S. military than UPS is, that basically people handling logistics is larger than the United Parcel Service.
SPALLANZANI: Who is one of Trump's biggest supporters, Fred Smith, from FedEx. So he's going to go in -- I'm sure he's going to help him out. You know, there's Mary.
(CROSSTALK)
SPALLANZANI: He has to go through all these contracts, and deals, and everything else and see what the heck is going on.
MCDOWELL: I actually understand this is about an allocation of resources, it's like you can take that $125 billion, that's 50 per day. So it is it men versus machine, is it people in the back office?
(CROSSTALK)
BARTIROMO: He's watching the cause.
KELLY: This joint strike fighter cost $1.5 trillion, and it hasn't been combat ready, it's been snafu after snafu.
HARLAN HILL, DEMOCRATIC STRATEGIST: Has trouble flying in the rain?
BARTIROMO: It's ridiculous.
SPALLANZANI: Not only that, you know, you go back to -- you know -- can you extrapolate a little bit you probably can, but there's ways to get things done, and a lot of it is common sense. But I think he's bringing all -- like he said the best leaders to government to really squeeze out the waste, and also save everybody money.
(CROSSTALK)
BARTIROMO: Let me ask you before you go, do you see investor interest in defense stocks? When you're sitting there on the desk, where do you see most the interest, which group?
SPALLANZANI: Diamonds, right now.
BARTIROMO: Diamonds.
SPALLANZANI: . Dow Jones Industrial Average is really what the bond.
(CROSSTALK)
KELLY: Holidays, and you know.
(CROSSTALK)
BARTIROMO: You're talking about broad ETF.
SPALLANZANI: Exactly.
BARTIROMO: The diamonds.
SPALLANZANI: The diamonds are doing quite well, right now. Obviously, with the Russel that you see of those big cap stocks, feeling a lot better, because there's so heavily weighted. And lot of the Trump.
MCDOWELL: Even with the dollar strength.
SPALLANZANI: Exactly.
BARTIROMO: And the worries of a trade.
MCDOWELL: Yeah.
BARTIROMO: John, good to see you.
SPALLANZANI: Thank you.
BARTIROMO: Thanks so much, great day to you, John Spallanzani. Coming up, the elite vote Democrats, Stuart Varney weighs in on the voting pattern from the country's wealthiest cities. And then, Disney huge year at the box office it's about to get even bigger, Star Wars, Rouge One, earnings have seen rave reviews, what could mean for the stocks. Back in a minute.
(COMMERCIAL BREAK)
BARTIROMO: Welcome back, 45 minutes until the opening bell on Wall Street, we've got a Nikkei average in Japan, and a 2016 high, we've got a market in the U.S. looking at new heights, Dow Industrial expected to be at another record high, even if the rest of the market is lower this morning. Couple of names on the move, we're watching Disney, the company winning the weekend box office yet again, with Moana, that is ahead of this week highly-anticipated release of Star Wars, Rogue One, that kicks off, and gets the theatres on Friday. While reviews for the film have been great so far, some analysts are worried that fans will respond to the first non-saga film differently, we'll see. Disney shares up 7 percent, month over month. We're also watching G.M. today, General Motors CEO, Mary Barra, telling business insider she's very excited for the company's plan for driving -- self-driving cars, rather. G.M. is currently testing automated both vehicles in California and Arizona. Shares of G.M. are -- this morning, looking higher. In leaps, voting Democrat, joining us right now, host of Varney & Co., Stuart Varney, with the voting patterns from America's wealthiest cities. Stu, good morning to you.
STUART VARNEY, VARNEY & CO. HOST: I couldn't resist. I just couldn't resist. You know, one of the themes of Varney & Co. is that you've seen a revolution in voting patterns. The wealthy people, the elites, now vote very solidly Democrat. That was very different from my early days in America, 40-odds years ago, when the elites were country club Republicans. I got some numbers together, San Francisco, richest city in America, when 85 percent for Hillary Clinton, 9 percent for Donald Trump. Greenwich, Connecticut, 56 to 39, Manhattan, New York City, 87 percent for Hillary, 10 percent for Donald Trump. And if you look at the 25 richest counties in America, Hillary Clinton won 15 of them by a very wide margin. That's just a reversal of what I remember when I first came to America, the elites now vote Democrat. I'm really surprised at this.
BARTIROMO: So why do you think that is Stuart? I mean, I asked the question recently why has media not done its job, why are academics spewing out this stuff to students, what do you think the answer is, I mean, why?
VARNEY: That's a very good question, and I'm not sure I got a really good answer for you. I think the media and the academics think of themselves as philosophy kings, they are smarter than we are, so just listen to us, shut up, and vote our way. I think that's what's coming down the pike here. But there's something else going on.
BARTIROMO: Yeah.
VARNEY: . which I can't quite put my finger on it, frankly, but I know it's there. I'm trying for an answer to your question.
BARTIROMO: Yeah, any thoughts, Harlan?
HILL: The struggle between nationalism and globalism.
BARTIROMO: OK.
HILL: . that's what I firmly believe that this is about. And globally, elites think that they benefit from a more open border immigration society, and average every day Americans don't believe it.
BARTIROMO: That could be it, yeah.
VARNEY: Plus, the expansionary -- you know, the pumping out of money by central banks around the world, which is pumped up America's stock market. And it is the elites who've done best out of that.
BARTIROMO: That's true.
VARNEY: So, they're doing well from the accommodation of Obama's policies that Janet Yellen put in place at the Federal Reserve. There's a lot going on here.
BARTIROMO: Yeah.
VARNEY: . I just feel that that election, Donald Trump is a pivotal point which exposes the underlying dynamics of our society.
BARTIROMO: Yeah. And we were just talking that on the way -- we've got to jump, but you said that Hillary won 15 counties, so Donald Trump won like 3,000.
VARNEY: Well, I'm told rather 25 richest counties in the United States, Hillary Clinton won 15 of them by wide margins.
BARTIROMO: Wow. Stuart, we'll see you in about 10 minutes.
VARNEY: Sure thing.
BARTIROMO: Thank you. Varney & Co., begins top of the hour, 9:00 AM Eastern, right after Mornings With Maria. And I'll see you by 11:00, Stuart. Coming up, moving the key to the cloud, one company high-tech solution to ensure you never get locked out of your home again. Back in a minute.
(COMMERCIAL BREAK)
BARTIROMO: So no more loss keys, you heard me. Never worry about losing your keys again, thanks to KeyMe, now you can copy home, office, even car keys, and save digital copies to the cloud, using your phone or kiosks available across the country, retailers like Bed Bath & Beyond, Rite-Aid, 7-eleven, K-Mart, Safe Ways, Sears, and others. Joining us right now is the CEO of KeyMe, Greg Marsh. Greg, good to see you.
GREG MARSH, CEO KEYME: Thanks so much.
BARTIROMO: How does this technology work?
MARSH: Yes, certainly. So my level of disrupting locks industry, this massive $7.5 billion industry, poorly run, fragmented, and haven't seen -- plus years. So we do is we let you actually scan a physical copy of your key from your phone, we use computer vision to extract all those symmetrical features, once you've done that, if you want a copy we'll ship you a perfect copy in the mail. If you get locked out, you can go to the second platform which is a retail kiosk, log in, and actually print out a spare key on the spot, so saving you hundreds of bucks from a locksmith. And then lastly, we also do keys. So if you answer your car keys in the kiosk, you can actually pull the transponder information that you put in the key, and we'll send you a copy about half a price.
BARTIROMO: There are some keys that cannot be copied, this -- you can still copy those keys?
MARSH: So our goal is to copy as many keys as possible, and securely as possible. So substantially enhancing the security in space, and some high security key makers like Medico or Multi lock are actually working with us to be there duplicator of choice because of all the security features that we have.
BARTIROMO: OK. Because I think that's what I'm talking about the Multi Lock. And another certain keys that -- the owner has to make the number of copies because they cannot be copied. We've been talking all morning about hacking. Is it secure in terms of being in the cloud, your key in the cloud?
MARSH: Yes, so security a core value at the company, we're very -- about it. There's really two buckets, so the first is, it's making sure that people are only copying keys that they should be copying. And when you look at the way people are currently copying keys at locksmiths or hardware, when you go in, locksmith or hardware, there is no way to verify who you are, and no way knowing what key in making. And so currently there's zero accountability, no instruction, no control, no accountability. For the first time ever we actually have, all this information associated with every key we make, so transaction history, financial paper trail, we use biometrics slot-in kiosk, we have security footage, so for the first time ever we're actually holding people accountable for the keys they copy.
BARTIROMO: OK. So you're holding people accountable, and you know that -- you've got that information. So you're a real disrupter, disrupting the locksmith industry. Where do you get the funding, you've got a latest round of funding, and what are you using the money for?
MARSH: Yeah. It's really exciting. We've been very fortunate to have an amazing group of investors, just recently we announced an additional $25 million -- equity, and so we've raised $70 million to date, and we're really putting the money towards expanding the kiosk network. So currently we have 300 kiosk, in the next 12 months we'll have 3,000. BARTIROMO: Wow.
MARSH: And so we're expanding across the country with retailers that you mentioned.
BARTIROMO: Those are the -- you've got partnerships with those retailers.
MARSH: Exactly. So we're in about a dozen different retailers across country, we're in 20 states, and the biggest challenge we have, as a company, is the delta between the number of kiosks, those retailers requesting, and the number we have. So currently those retailers are requesting about 10,000 kiosk.
BARTIROMO: Wow.
MARSH: So we're trying to build as many as quickly as possible.
BARTIROMO: Good stuff. Greg, congratulations, thank you so much.
MARSH: Thanks so much.
BARTIROMO: Greg Marsh there. We will be right back with a first look at the Golden Globe nominations. You don't want to miss it, back in a second.
(COMMERCIAL BREAK)
BARTIROMO: All right. The nominees are out for this year Golden Globes just released nominations, for best actress in a drama include Amy Adams, Natalie Portman. Denzel Washington and Ben Affleck nominated best actor in a drama film, Casey Affleck. Best TV series, picks includes Game of Thrones and Stranger Things. Best movie drama nominees includes Hackshaw Ridge and Manchester by the sea.
MCDOWELL: Hacksaw Ridge is Mel Gibson directed. Talk about a career comeback. He gets a director nomination there. I think the one that's really got a lot of momentum would be Manchester by the sea, which is in theaters now, it's Kenneth Lonergan, directed it, terrific playwright. Casey Affleck, apparently, really just slays in that movie.
BARTIROMO: Wow. You guys see any of this?
HILL: I haven't
MCDOWELL: Not yet.
KELLY: Game of Thrones for life, always and forever, Khaleesi.
(LAUGHTER)
BARTIROMO: Great show you guys. We will watch the developments. Kevin Kelly, Dagen McDowell, Harlan Hill, great to see you.
HILL: Great to be here.
BARTIROMO: We'll see you tomorrow everybody. Thanks so much for joining us. "VARNEY & CO." begins right now. Stuart, I'll send it right over to you.
END
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