Motley Fool Hidden Gems Investing - Motley Fool Money: 09.17.2010

Episode Date: September 17, 2010

Warren Buffett reassures investors and Research in Motion surprises investors.  On this week's show, we talk about some of the week's top business stories, share some stocks on our radar, and talk trash with CNBC host Carl Quintanilla.  Learn more about your ad choices. Visit megaphone.fm/adchoices

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to speak to an advisor free of charge. BetMGM operates pursuant to an operating agreement with iGamingOntario. Everybody needs money. That's why they call it money. From Fool Global Headquarters, this is Motley Fool Money. Welcome to Motley Fool Money. Thanks for being here. I'm your host, Chris Hill, and I'm joined by Motley Fool Senior Analyst Tim Hanson, James Early and Rich Griefner. Guys, good to see you. Good to see you, Chris. Coming up later in the show, we've got Carl Quintanilla, one of the hosts of CNBC's Squawk Box, talking about the new

documentary he's been working on. We've also got the latest from FedEx, Johnson & Johnson, and the annual list of the top brands in the world. Plus, as always, an inside look at the stocks on our radar. But we begin with the big macro. At a Senate hearing earlier this week, Treasury Secretary Tim Geithner got some tough questions about our trade policy with China. Warren Buffett ruled out a double-dip recession. The stock market's gains so far this month have the S&P 500 back in the black for the year. And the price of gold hit yet another all-time high at $1,280 an ounce. Let's just go around the table, guys. Tim Hanson, what's your headline of the week? Well, I'm a bit of a China nerd, Chris. I've been watching the Geithner Senate talking points about

China pretty closely. And it's an interesting issue. I mean, what they want is they want China to accelerate the rate at which it allows its currency to strengthen. China doesn't want to do that. But again, it's a complicated issue. You know, we're entering the political season. We talked about this recently on the show also. And the point is, you know, if you're a textile worker in Alabama, you want China's currency to strengthen pretty fast. If you're a textile worker in Guangdong province, you don't. But because both people want to be employed, it'll be fascinating to see how that plays out. James Early?

Chris, leave it to Tim Geithner to bring a water gun to a gunfight. I mean, we need to get much tougher on this China issue. It's been on the table for almost a decade and we still haven't done anything about it. I think China is thinking, well, look, if the U.S. declares us a manipulator,

they're going to import less of our stuff. If we raise our currency, they're going to also import less of our stuff. But we still need to declare them a manipulator and really hit them where it hurts, which is their pocketbook. Well, you know, it's a tricky issue. I mean, because if you do that,

And there's a lot of thought. It's a very complicated issue. I mean, remember, China happens to be our largest creditor at this point. And if we label them a currency manipulator and they decide to and we stop importing their stuff, that reduces their ability to buy our debt. And it's a bit of an academic issue. But our government right now is being subsidized by the Chinese and all of our spending priorities. That dries up and we have some other problems on our hands. China owns five percent of the U.S. debt, which which is a lot. I mean, it's the biggest foreign ownership stake ahead of Japan. But I still have to say, I think that in a war, which I wouldn't want, a trade war, I should say.

Let me be very clear about that. A trade war, China would come out the net loser here. That escalated pretty quickly. Rich Griefner, what was your headline for the week? Well, Tim's a China nerd. I'm a bit of a Buffett nerd. And I was surprised this week to see Buffett come out and practically guarantee that the U.S. will not have a double-dip recession. He was pretty emphatic about that.

So, Buffett says, I've seen sentiment turn sour in the economy over the last three months or so. However, he's not seeing that in Berkshire's businesses. And that's something, you know, he's got his fingers in a lot of pies. Berkshire owns something like 80 companies. So, he's got a pretty good sense of what's going on. However, when I look at the data, I don't see anything to justify being as sanguine as Buffett is. What is his track record like when it comes to making these sort of broad, sweeping economic predictions? Oh, he's a hack.

I think he doesn't care at this point. making all kinds of... Well, actually, Chris, that's a great question. His track record's excellent. Back in 1974, Buffett said, now is the time to invest and get rich. He was correct. In 1979, he said, now is the time to buy stocks. The stock market went on a 20-year bull run. Then in 1999, he pretty much called the peak of that bull run. He said, investors and stocks today are expecting too much, and they were. And in October 2008, of course, he said, buy American, and I am, and we experienced a huge rally. But didn't he endorse the new Coke?

Rich, as you mentioned, Berkshire Hathaway, 80 companies in that range, ranging from everything from Geico Insurance to railroads to See's Candy. Is Berkshire in any way a proxy for the broad economy? I think it is, in the fact that, so Buffett says, you know, I'm hiring more people this month than I was last month. I hired more people last month than I did the month before. What he's neglecting to mention is he fired 17,000 workers in 2008 and 2009. So, yes, I do think he's a good proxy for the U.S. economy. Don't bury research in motion. It's not dead yet.

On Thursday, the BlackBerry maker reported better than expected profits, and the shares popped on the news. James Hurley, I know you're a big Apple guy, so you're probably not packing a BlackBerry torch, but what did you make of it? Chris, let me tell you how it is. In their recent quarter, RIM looked good in every way, except actually adding BlackBerry subscribers. And that's like saying everything was good about the restaurant except the food. It's slightly less dead than analysts thought, but less dead is not good. But it does still lead the U.S. smartphone market.

I mean, for someone like me who doesn't actually have a smartphone, just looking at the landscape, it's a little bit of a disconnect to see the market leader basically being dismissed by everyone. Well, you know, the RIM CEO went on a bit of a rant on the call after these earnings. He did. People are very skeptical of RIM for a lot of good reasons. Technology is clearly inferior to what's being offered by Apple, the iPhone, and the Android operating system. But he had at least one quote in that rant that was worth listening to. And it was, because if you make these things so high end, talking about smartphones, that they're not addressable to the market or that they're so consumptive of the networks, which, as we all know, are pretty strained, that they can't scale. Well, that's not what we originally designed our business for.

Translation, you know, BlackBerry is a basic product helping people do basic things. It's not trying to be a smartphone. And there was a fascinating article this week in Ad Age about some myths about the mobile business. And one of the ones that they pointed out was that smartphones may not end up dominating the mobile market. They compared them to DVRs, you know, the TiVo, those digital video recorders, which were rapidly adopted early on by people. And they got up to 30% market share really, really quickly. But then it stalled because, you know, 70% of the people out there weren't willing to buy them, pay the subscription fee, and also just didn't really care to have that much technology in their house. So there is an idea out there that as you go down market, people won't need iPhones,

and that gives BlackBerry a place that they can hold on. Isn't the BlackBerry still a smartphone? I mean, doesn't that actually hurt more if the smartphone market doesn't grow quite as much? Well, I think it's just the price point and the service contracts. And, you know, obviously the network point is a really interesting one. I think one we've talked about in the past in this forum, which is that these networks are strained. And as people download more and more data, right now you get to pay a flat rate. I pay $20 a month for my Android, all-I-can-eat data.

Well, what if everybody does that and the network can't handle it? So what I think the phone operators are going to have to do at some point is start charging people per the amount of data downloaded. And when that happens, all of a sudden listening to Pandora on your iPhone 24 hours a day stops to be so economically attractive. You mentioned the rant that the CEO from Research in Motion went on. You know those Canadians. I don't actually know if he's Canadian. I was just going to say, T. Hanson is Canadian. T. Hanson at Foo.com.

But I want to bring in our man behind the glass, Steve Roido, because one of the phrases he kept using on the conference call during this rant was this phrase, resolve the paradox. Steve, not to put you on the spot, but do you have a paradox that you'd like to see resolved? Absolutely. Music television, which does not actually play music anymore. It's just great reality programming. So, you're saying MTV needs a rebranding?

I believe, yeah, and I think they may have even done that. I believe music television has been removed. It's just MTV. Meaningless letters now. You're listening to Motley Fool Money. We're going through some of the big stories of the week. Earlier this year, Johnson & Johnson recalled millions of children's Tylenol products. There are now reports that the company may have known about the problems

and planned to remove the drugs from stores months before the official recall. James Early, Johnson & Johnson is a stock that you follow closely in the service you run. What did you think of this news? Well, Chris, yeah, it is kind of like a made-for-TV movie. I'll get the serious part out first. This news has been buzzing for a few months. It doesn't change how bad it is. I think their consumer chief, Colleen Goggins, is going to leave next year over this.

And now the House Committee on Oversight and Government Reform wants to host CEO Bill Weldon again on the first time on September 30th. 30th. But the funny part is they apparently paid some company to go out pretending to be mystery. These people went out pretending to be mystery shoppers buying up the entirety of this J&J stock. And it's just, as we were talking before the show, it's just amazing. You can actually find companies staffed and ready to participate in a clandestine recall in the U.S. It just blows my mind. Yeah. And just to be clear, this is all according to documents that were released this week by lawmakers. And yeah, to your point, the documents are saying that this company was going to go out to 400 locations across the country and just, like, I don't know,

just fill up the shopping cart. Think about the absurdity of this. This is some guy, I don't know, dressed in a hooded sweatshirt, rolling into the aisle with his cart, and just pulling everything off the shelves, going out to check out, and buying, you know, $400, $500 worth of Tylenol on the spot. Which is ironic because apparently contractors were instructed by Johnson & Johnson to act, quote, like regular customers. Very bad headaches. Well, another reason why this is ironic is because Johnson & Johnson is the classic case study of how to successfully conduct a product recall.

They're the gold standard. If you recall back in the early 80s, some nut in the Chicago area poisoned like five or six bottles of Tylenol. J&J conducted a nationwide recall. They overreacted to ensure that their brand remained untarnished. So do you think that this phantom recall, which is how it's being referred to in some press reports, do you think this phantom recall has the potential to undo that gold standard for Johnson & Johnson? Chris, a little bit. It is looking worse. I'll have to admit that. They have this. They have a contact lens recall.

They also have a hip replacement recall. I mean, who wants to have their hip recalled, right? But J&J is a really, really, really big boat, and I think it's going to take more than this to rocket. Coming up, what companies have got the strongest brands in the world? Stay right here. You're listening to Motley Fool Money. Welcome back to Motley Fool Money. Chris Hill here in the studio with Tim Hanson, James Early, and Rich Griefner as we dig into some of the companies making headlines this week.

On Friday, President Obama introduced Elizabeth Warren as a special advisor to help set up the new Consumer Financial Protection Bureau. Warren released a statement warning banks that the time for hiding tricks and traps in the fine print is over. Tim Hanson, what do you think about the new cop on the beat? Well, you know, I'm still reeling a little bit from that Elizabeth Warren rap video that came out a couple weeks ago, portraying her as the sheriff coming in to clean up town. You were mentioning this during the break, that there actually is a rap video. You watch a different genre of MTV. There is no more MTV. We learned that in the last segment.

No, there is only MTV. That's right. That's right. So she's portrayed as a sheriff coming in to clean up town, and that's certainly the perception that the businesses she's coming in to sort of regulate have of her, which has led to a lot of opposition to her in this role. Interestingly, you know, I'm torn on the appointment, not so much because I have any animosity towards her,

but because I really question the need for this bureau at all. The reason I think that, I think, you know, this cheap credit thing we had over the past couple years, you know, think about it as compared to the war on drugs. You know, we can attack and attack and attack the supply side, you know, go after the people who are making these products or go after the drug dealers. But until you attack the demand side and make sure that people are consuming more responsibly, you know, there's always going to be someone there to sell you meth. James?

Well, Tim goes back to his bunker after the show. I will make the other point that an ounce of prevention is worth a pound of cure here. And I'm not for big government, to be very clear. But, you know, if you look at the community reinvestment, if you look at some of the causes of the subprime crisis, you had people getting into things where they shouldn't have been. People by nature, by their just nature, I guess, don't like to read the fine print. And I think they're always going to be like that. So I do think we have to protect people from themselves to some degree, as elitist as that sounds. All right. Let's move on to some mixed news from FedEx.

On Thursday, FedEx announced first quarter net income doubled and the company raised guidance, but also announced it's cutting 1,700 jobs in the U.S. Rich Griefner, would you make it a mixed news? Well, I mean, it's not very mixed news, Chris. It depends on your perspective. Like Tim was saying, if you're a factory worker in Guangdong province, was it? Yeah. Guangdong province, you're happy. If you're a factory worker in Alabama, you're probably not pleased. That's not very mixed. Black and white. Thank you very much. FedEx fired 1,700 U.S. workers. Again, going back to the Buffett

segment earlier, I just don't see the signs of improvement. For FedEx, I think the long-term growth drivers for the business are very strong. I think international economies are going to improve. I think increased international trade will be a boon for them. I also think there's a trend towards e-commerce, which works well for a shipping company such as FedEx. But in the meantime, the company is still pretty levered to the U.S. economy. And the U.S. economy, despite what Warren Buffett says, I don't see it looking too healthy. Tim Hanson? Well, this is a theme that's been emerging across a lot of large U.S. companies, which

is that they've been seeing weakness in their earnings at home and strength in their earnings abroad. And I think that lends some credibility to the theory that you should be a global investor and a global business when it comes to figuring out what you want to do next year and beyond. James? And that's how I travel internationally. I just FedEx myself. It's so much cheaper. You're listening to Motley Fool Money. We're going through some of the big company news this week. Interbrand came out with the annual list of the top 100 global brands.

Coca-Cola, IBM, and Microsoft made up the top three. Other notables, Apple, Google, and Amazon had some of the biggest gains on the list. BP, which had been on the list in previous years, fell off completely. Why did that happen? Yeah, was there any news related to that? It must have been something. You might have heard a little something earlier in the year. Not a great year for BP, particularly from a brand standpoint.

Just as investors, how important is a brand to you, and what did you make of the list? Well, brands are good to have. They're valuable. Obviously, especially when you're a consumer company, you'll notice most of the brands on the list are very consumer-oriented. Coke, at number one, sticks out. This is a global business that's succeeding in many, many countries using its flagship Coca-Cola beverage and other well-known beverages. Sprite has made the list as well. That's a Coke product. So, brand matters, and brand has value.

Rich? Yeah, and I echo Tim's statement. Yeah, a brand has value, but you also have to support that brand. And I'll point out that every company has a brand. I mean, Jordache Jeans has a brand, but it's not as valuable now as it was back in the day. Those are fighting words. I noticed James is wearing Jordache right now. Sorry about that. Acid wash. But a name that sticks out to support that is McDonald's clocks in at number six, and

And right now, the brand's very healthy internationally as well as here in the U.S. But if you recall, not so long ago, back in the 2002-2003 time frame, I mean, McDonald's brand was tarnished. It was known for being dirty, poor customer service. James, what'd you make of the list? Well, you know, Chris, this is, I guess, a survey conducted by some consulting company. But as an investor, I can say that the point of a brand is to let you charge more than you could otherwise charge without the brand.

So, for example, you buy Coca-Cola, you pay a bit more for some generic or no-name brands soda. It's basically all costs the same. But I have to question this list because number 40 is Citigroup. And I don't know that would pay extra to have the privilege of patronizing Citigroup. Well, there are other questionable ones in the top down. Nokia is up there. I think, is Nokia ahead of Apple? Nokia is far ahead of Apple. Apple's 17. That seems odd. There are a couple more quirky ones that stick out. HP in the top 10. IBM number two. I don't even know what IBM does anymore. Not computers, not software.

Tim, what about some brands that are stronger overseas than they'd be here at home? Well, one of the ones that popped up on this top 100 is Kentucky Fried Chicken, which I think among American consumers is sort of considered an also-ran. I mean, you don't have a lot of people running out to go to KFC or take their hot date to KFC on Friday. Maybe James. Maybe that was my problem. But in China, for example, KFC is a huge national nationwide brand, and it's actually, you know, the food is priced higher than what you would consider fast or street food over there. So it actually is sort of an impressive date location. So interesting how those things happen.

Five years from now, what's going to be higher on the list in terms of brand strength, Apple or Google? I would say Google. Their hand is in more cookie jars right now. James? I'm going with KFC. Rich? KFC.com. I'll also go with Google.

I mean, Apple has a very strong brand, but in order for that brand to still be strong in five years, you're going to have to come out with the i-something, the i-TV. i-awesome. All right, the guys will be back later in the show to talk about the stocks that are on their radar, but we want to hear from you. Drop us an email at radioatfool.com. What do you think is going to be a bigger brand five years from now, Google or Apple? That's radioatfool.com.

Coming up, CNBC host Carl Quintanilla joins us to talk a little trash. Stay right here. You're listening to Motley Fool Money. There's something rotten here. Say what? You better hold your nose. Hey, you. This is the time.

You got it. Welcome back to Motley Fool Money. I'm Chris Hill. My guest this week is one of the hosts of CNBC's Squawk Box, and he's the host of a new CNBC documentary, Trash Incorporated, The Secret Life of Garbage. It airs on Wednesday, September 29th at 9 p.m. Carl Quintanilla, thanks for being here.

Good to see you, Chris. You know, most people, I think, are like me in that we think about trash once a week when it gets collected. What is it about garbage that made you want to investigate this industry? I think the genesis of it probably came from watching the performance of some of these stocks, even as other stocks were getting trounced. We wondered why was there such resilience in these few public names, even as the rest of the market was getting hammered.

And the more we looked at it, the more we realized exactly your point, And that is, it may be the most misunderstood economic commodity out there, because it ends up having a surprising amount of value after it's gone. But most people's experience with it is exactly as you described. You put it on the curb, it goes away, you have no idea how far it goes or how much it costs to go to that place or who's paying for it to go there. That all lent itself to what turned out to be an extremely rich look at a very strange industry. I thought maybe you had, you know, ticked off your bosses at CNBC and they said, I know, let's send Carl to a landfill halfway around the world. Try five landfills.

That was, you know, can I say it was pleasant? No. Did I go through multiple pairs of shoes and pants? Yes. um landfills are i mean look they are they are ridiculously um advanced from an engineering standpoint uh and they even manage to find ways to uh minimize the odor but that was it you know what i want to spend uh you know the rest of the afternoon there even with you the answer is probably no uh some of the numbers in your documentary are astonishing uh garbage in America is on an all-time high, 250 million tons a year, more than four pounds a day per person for everyone in the United States. What surprised you the most when you were working on this

documentary? Well, I think, well, two things, I guess. One is, you know, we all hear about the NIMBY problem, right? Not in my backyard. There's an old saying in the industry, everybody wants it picked up and nobody wants it put down. So the degree to which towns in America, I mean, it's incredible. It's a municipal economic story, but a lot of these small towns in America are making a bargain to bring these landfills in, take a cut of the fees, and basically boosting their local budgets by 50%. I mean, that pays for a lot of little league fields and community theaters. So that NIMBY problem seems to be fading, which is really interesting. The other thing is that as we've gone through this economic rough spot, trash levels, the

The amount of stuff you and I throw away has obviously flattened out. Commercial trash, mostly stuff that they used to pick up from housing and commercial real estate, that's obviously cratered. So where does the industry make up the difference for that volume, that loss of revenue? It turns out they're finding ways to turn trash, in most cases, into energy, just like Dr. Emmett Brown does at the end of Back to the Future, where he pulls up in the DeLorean, puts trash in Mr. Fusion, and flies away. That ended up not being that far from the truth. We visit this one BMW plant where half the electric grid is powered by methane gas.

That blew me away. I had no idea that they were that so far along in terms of energy generation with trash. You're listening to Motley Fool Money. We're talking with Carl Quintanilla from CNBC's Squawk Box and host of a new documentary, Trash Incorporated, The Secret Life of Garbage. A couple of the leaders in this industry are companies like Waste Management and Republic Services. At The Motley Fool, as investors, we like companies that, among other things, have a moat around them. These companies seem like they're in pretty good shape in that regard.

Are there companies out there that are poised to challenge them in any significant way? Well, if you don't mind me talking some economic vernacular. Absolutely. It would be very difficult for a new player to come in and have their kind of vertical integration. I mean, there are hundreds, maybe thousands of private collectors. Because a truck, you and I could go out and buy a truck for $250,000. And we could start collecting trash in New York City and get paid, right? But we would have to eventually pay someone else to park it wherever it went, into the landfill.

What Waste Management and Republic and those guys, the big guys, have is that chain where they own the landfill. They own the trucks. In some cases, they either own or contract the rail. That is where all of their cash generation comes from. And as you know, Chris, that cash is so flush and so attractive. And that's why the industry for years was a hotbed of organized crime. Because it was an efficient way to launder money just because of the sheer amount of cash flow in these companies. It's incredible.

When Warren Buffett came out earlier this year with the annual letter for Berkshire Hathaway, the thing that caught my attention was that the position that he had increased the most in his holdings was Republic Services. He had more than doubled it. I mean, is that as good an indication as any that this is an industry investors should be looking at? Well, you know, far be it from you or me to speak for Buffett. But when you look at that position and you look at Burlington Northern, I mean, his bet, and granted, it's, you know, he's thinking on a time horizon that might not be, that might not coincide with a lot of investors. But his bet long-term is a play on goods moving around the country, whether they are going to the consumer or away from the consumer, in the case of garbage.

That's a thesis that he has stuck with. It's been years now. And you're right. He absolutely doubled down with Republic and with Burlington. It's going to be fascinating to see if it turns out to be right. But given his track record, who wants to bet against him? You're listening to Motley Fool Money. My guest is Carl Quintanilla from CNBC.

Earlier this year, you were in Greece covering the protests and the debt crisis. Earlier this week, Prime Minister Papandreou said Greece can meet the demands of international lenders and avoid defaulting on loans without needing to impose more austerity measures. Do you think he's right? I don't know. I was there in May, and people's heads were spinning. And we really didn't know. They're sort of where we were on our Lehman weekend, right?

And so, so much of the very near-term future was cloudy. Then we had the ECB come in, and we got through the rest of the summer. I think the bigger challenge right now is going to be changing an entire culture and way of life, which, if you've read Michael Lewis's piece in Vanity Fair, is going to be difficult. And I'm not sure that any civilization in our lifetime has had to reinvent itself like that, to revamp your tax system to where it actually collects taxes, to convince teachers that benefits and pensions are going to change and they're going to change for good. But I'll say this, though. At the time, people were angry, and they were angry not because the government was in trouble. They were angry that the rest of the world was trying to school them in how to manage their economy.

And I remember telling people, you don't have a lot of legs to stand on right now. So you might want to maybe get a little humility. I can't wait to go back and see if things have changed. If you're looking to borrow money from us, you might want to rethink your tone of voice. Exactly. You know, obviously, every day people are trying to read the tea leaves of our own economy, and there's certainly no shortage of information out there. Government reports on jobs, manufacturing, housing.

In your role at CNBC, are there some numbers that you give more weight to than others? well um let's see i mean when durables roll around we we tend to look at um business spending aircraft that's a favorite that sometimes gets buried i think um jobless claims obviously are like jobless claims to me right now are sort of like sandra bullock i mean everybody there's it's like they they were sort of hot then they sort of weren't now there is no one who would not want that interview, right? It will be interesting to see how long that lasts. I'm trying to think, others that kind of come and go, we're pretty, the flow is so rushed of just numbers and data every day that you really have to pick your favorites. But I guess at the moment

but it would be something regarding durables and jobless claims. I think the consumer data, retail sales, confidence, is overdone because I think people have underestimated the degree to which emerging markets are going to feed revenues here in the U.S. You're listening to Motley Fool Money. We're talking with Carl Quintanilla from CNBC's Squawk Box. All right, Carl, before I let you get away, we have to close with a round of buy, sell, or hold.

I'm nervous already. No, no, this is going to be fun. Like you, I have two daughters myself, so buy, sell, or hold the time-honored tradition of fathers intimidating guys who want to date their daughters. I'm definitely long. I'm a buy on that. There's a great country song, I forget the title right now, but it's about a guy who's talking to this young kid who comes to pick up his daughter and he says, Have fun, stay out as much as you like, I'll be at home cleaning this gun. buy, sell, or hold the New York Yankees making it back to the World Series this year? I'll say buy, and I can't say I'm thrilled about that. Really? You're not a Yankee fan? I respect them, but I'm part of that group that says they bought a lot when others couldn't,

and I would love to see my Cubs. I'll be waiting for a while. You're a long-suffering Cubs fan? Yes. You can purchase these on CNBC's website, buy, sell, or hold Squawk Box Mugs. I'll tell you this, this is the trade of the century. Definitely buy, because you may not be able to get them, production may not be able to keep up with demand. Now, I have to ask, I was looking at the mugs, and they've got cartoon drawings of you and Becky Quick and Joe Kernan. Are you guys seeing any of that money?

Are you getting a cut of that? If there's a check on the way, it must have gotten lost in the mail. I think they nailed Joe. They definitely nailed Becky. I think his eyesight must have been impaired when he did me, because I look nothing like that. But I'm not going to complain. And finally, People Magazine once named you one of the 50 most beautiful people in the world.

So buy, sell, or hold the likelihood that your Squawk Box co-host, Joe Kernan, will one day receive that honor. I'm going to say bye, only because I have to sit next to him for 15 hours a week. The new CNBC documentary is Trash Incorporated, The Secret Life of Garbage. It airs Wednesday, September 29th at 9 p.m., so set your DVRs, people. Carl Cantania, thanks so much for being here. Chris, thanks. I love it because it's trash.

Oh, I love trash. Anything dirty or stingy or dusty, anything ragged or rotten or rusty, yes, I love trash. It's some more rotten stuff. Coming up, Philip Morris did it, Arthur Anderson did it, and now high-fructose corn syrup wants in on the act. Stay right here. You're listening to Motley Fool Money. Yeah, the bad things in life are free, but you can give them to the bad guys. As always, people on the program may have interests in the stocks they talk about.

Don't buy or sell stocks based solely on what you hear. I'm Chris Hill, and back in the studio with me are a trio of senior analysts, Tim Hanson, James Early, and Rich Griefner. Guys, one story this week that we did not get to earlier in the show, the Corn Refiners Association has petitioned the FDA to change the name of high-fructose corn syrup to corn sugar, because apparently that's how bad the reputation of high-fructose corn syrup is. So I wanted to use this as a really cheap excuse to just talk about rebranding in general. Tim, we've talked about this on the show before, how, like, Philip Morris rebrands itself as Altria.

Altria, sure. But just here in the U.S., overseas, aren't they still – Well, they're still Philip Morris International, and they're still selling Marlboro cigarettes. And, well, they still sell Marlboros here in the U.S. But, you know, the key to rebranding is that something has really negative connotation, like high fructose corn syrup. And he changed it into something fun and lovable and cuddly like corn sugar. Who doesn't love corn sugar? So my proposed rebranding, I think there's a country that's fallen on a really tough time sort of on the national stage right now.

That's Russia. Okay. You know, Russia rebranded not too long ago. Sure. From the USSR to Russia. And all of a sudden they were a democracy. And speaking of, that was a strong brand, the USSR. Well, right.

But they had a nice run. They got Boris Yeltsin, who was very lovable and cuddly. But now, you know, Putin and corruption, they've got a problem. So I'm going to propose Russia rebrand itself as the North Pole, bring back Putin, or bring back Yeltsin in the Santa Claus role, and I think they might see a turnaround in that country's fortune. That's strong. I like that. You've got a lot of mail, too.

Yeah, well, Russia's been holding back the brick these last five years, so I think they need to do something about that. And you know what? I mean, I'll tell you where that's going to help, tourism. Oh, absolutely. Because when kids start hearing about the North Pole, Everybody's going to want to go. families are all the same. How many eight-year-olds want to visit Boscow today?

Very few. You rebrand that to the North Pole? Make the Kremlin into the elves' workshop? I like it. They've got something. James Early, what do you got? Chris, I want to start a business that sort of just arbitrages brands from one country to another. I found out that in China, somebody is selling Pabst Blue Ribbon,

which here is sort of like the cheapest beer you can get. Bite your tongue, James Early. Selling it for $44 a bottle, putting it as this exclusive quote-unquote blue ribbon drink that's probably served in Kentucky Fried Chicken. You wonder how many other things are like that. Value is all relative. I'm sorry. Pabst Blue Ribbon is going for $44 a bottle?

$44, Chris. We could have been millionaires had we thought of this. It comes in a fancier bottle, though. It is a little bit nicer bottle. They've dressed it up. Although, you know, consider Corona is an example of a beer in Mexico that's sort of not expensive, and then it comes in the United States, and it's in the premium category, technically.

It's on the brand list. It's on the top 100 brand list. Rich Griefer, what do you got for rebranding? I'd actually like to rebrand a person, Chris, and that individual is Tiger Woods. I think we all know Tiger's fallen on some hard times, and I think it's just because he's not being true to who he really is. Oh, boy. We've seen the real Tiger, right?

He came back, tries to present himself as a family man. The wife's gone. The kids are gone. Embrace who you really are, Tiger. The interesting thing is what Nike has to say about that. They're probably going to dictate how Tiger Woods brands himself next year more than Tiger Woods will. What do you think?

Do you think he just goes with the single first name, Eldrick? You think it's just that, like Cher? I think he's got to go to something like El Tigre and get exotic. I like that. Steve Broda, you have a rebranding for me? I would love to rebrand Radio Shack. Everything about Radio Shack just sounds awful. The word radio, which sounds somewhat outdated,

I know that's probably blasphemous considering what we're doing right now. I was going to say considering what we're doing right now, yeah. And the word shack. Neither of them just feel very current. How do you feel about Podcast Hut? I like Podcast Hut, except for Hut. Maybe Podcast Laser. Podcast Condominium?

Exactly. That's great. Plaza? How about that? Podcast Plaza. Alliteration. Have you gotten that website? Have you secured that URL?

I will do that right now. Our checks from Radio Shack now, Podcast Plaza, should be rolling in any minute now. Any minute. All right, let's go around the table, talk about the stocks on our radar, and Tim Hanson, we'll start with you. So this is one I'm watching very closely, and I think other people should add to their watch list, and it is a Japanese tool manufacturer that all the handy people out there are going to know, and that's Makita, which is a maker of power tools and drills and woodworking equipment.

And the reason I'm watching is it's a Japanese company. And as we all know, the yen right now is strengthening dramatically for a variety of reasons. This hurts Makita because their costs are denominated in yen, but they're selling in things like dollars and Chinese RMB and whatnot. So my expectation is that people are going to notice that and the stock is going to drop. But Makita is a superior brand, superior company, great products. And, you know, if it drops on this yen strengthening news, I think it'll be one to pick up. And what's the ticker symbol?

The ticker is M-K-T-A-Y, and that's on the NASDAQ, Makita. James Erling? Chris, I'm also going tool today with Illinois Tool Works. The ticker here is I-T-W. It's not so much just tools, but a lot of miscellaneous industrial things. 3% yield, just raised its dividend 10%, which got my attention. I have not done a valuation on it yet, so it's not an endorsement per se, but it's an interesting stock.

18% return on equity and 12 cents of every dollar they make. gets converted to free cash flow. Rich Riefner? Yeah, Chris, we were talking about trash earlier. I've got a company that I like that plays in that niche. It's called Darling International, ticker symbol D-A-R. And despite the cute name, it's actually quite disgusting.

It is a pretty cute name, though. Well, the business, frankly, businesses don't get much grosser than this. What Darling does is it operates processing centers where it takes animal carcasses, used oil and grease from restaurants. You can probably stop there. No, no, no, it gets better, Tim.

And it takes it and renders it into products that people actually want to use. All hot dogs. Soap, fertilizer, not hot dogs. That is pretty disgusting. This is like Fight Club. It is a little bit like that. This is the Tyler Durden company. In many ways.

All right. And I'm sorry, one more time the ticker symbol? It's DAR, Darling International. And the reason why I like it is these are disgusting services. No one's graduating from college looking to make big bucks in the trash rendering industry. So a monopoly sounds like what you're saying. A very strong competitive position. All right.

Rich Griefner, James Early, Tim Henson. Guys, thanks for being here. Thank you, Chris. Thank you. Thanks to our special guest this week, Carl Quintanilla. The new CNBC documentary is Trash Incorporated, The Secret Life of Garbage. It airs September 29th at 9 p.m. If you missed any part of the show, you can find it at our website, motleyfoolmoney.com.

Our engineer is Steve Broido. Our producer is Matt Greer. I'm Chris Hill. Thanks for listening, and we'll see you next week. Thank you.