Motley Fool Money - Motley Fool Money: 05.27.2011

Episode Date: May 27, 2011

Google introduces tap-to-pay technology. Hedge fund manager David Einhorn calls for Microsoft CEO Steve Balmer to step down. And Krispy Kreme reports its tenth consecutive quarter of same-store-sales growth. Our analysts tackle those topics and share some stocks on their radar. Plus, corporate governance expert and film critic Nell Minow talks whistleblowers, Netflix, and must-see movies. Learn more about your ad choices. Visit megaphone.fm/adchoices

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From Fool Global Headquarters, this is Motley Fool Money. Welcome to Motley Full Money. Thanks for being here. I'm your host, Chris Hill, and I'm joined by Motley Fool Senior Analyst, Seth Jason, James Early, and Ron Gross. Guys, good to see you. Hey, Chris. We've got some delicious earnings from Krispy Cream. We've got an influential investor calling for Microsoft CEO to step down.

And we've got yet another sign that we might. possibly, maybe, maybe be looking at another tech bubble. Plus, as always, we've got a few stocks on our radar. But we begin with a disappointing week for the big macro. America's economic growth in the first quarter was 1.8 percent. That was below expectations. Weekly jobless claims came in at 424,000. That was above expectations. Ron Gross, I'll pick on you first. What do these numbers say to you? Not strong. Growth is better than no growth. That's That's for sure. But the fact that growth is somewhat anemic is concerning to me. And for many months, I've been pretty conservative here and concerned that once government stimulus is removed

with unemployment remaining high, our economy is not going to really be able to be self-sustaining. So we'll have to see how the trend continues. A quarter by quarter will be watching this, but I'm concerned. QE2 ends at the end of June, quantitative easing. The second one ends at the end of June and we'll see where we go from there. But there's not many more tricks the government has to pull out of its bag of tricks. Seth? Well, yeah, we're in a bit of a dangerous spot here because, as I've mentioned, a few times on the show in the past few weeks, we have a lot of demagoguery out there among the politicians about how we're printing money and we're getting all this inflation. And yeah, some commodities have spiked and that causes some inflation in certain items and

certain component prices, but we really don't have the risk of the systemic sort of inflation. that would suggest we need to pull back on economic stimulus. And if people think potential for inflation is bad, the deflation of an economy is a lot worse. James? Yeah, I would agree with that. I mean, one of the things that makes us charming, I think, as panelists is that we're probably not as confident sounding as most economists or talking has. And in reality, nobody knows what's going to happen here.

I mean, the thing that I do know is that for every action, there's an equal and opposite reaction in economics. So the private sector screwed up. the private sector has to pay some price. Now, we can let the private sector pay the full price, or the government could step in as it's doing, but there will be some effect of this government stimulus, whether that's inflation in five years or not.

I don't know. I do agree with Seth that deflation is by far the bigger problem because nobody can do anything about that. But we can't sort of get out of everything. We can just sort of rearrange the pain. And I want to say that I'm charming for many, many more reasons than just that. As we both know. Google is hoping that smartphones can

replace wallets. This week, Google introduced technology that enables a person to tap their phone screen to select a card, then tap the phone to a credit card reader in a store or restaurant. Google would make money by selling coupons and advertising. Seth, what do you think? Wow. The most amazing thing about this innovation is the way Google continually finds ways to innovate ideas that other people have already had and the press pretends that Google is doing something brand new. They've been paying for stuff this way in Japan. for years now. They launched services like this. Orange has launched services like this in the UK has failed in the past, is trying again. As you note, Google's approach is a little bit different.

It's making the payment system free, but they're hoping to make their money back by, I call it spying on people, but by knowing exactly what you're buying and then sending you Groupon-type coupons and then taking a cut of those sales, of those potential sales, there's a chicken and egg problem here, which requires a phone with one of these near-field communications chips and checkout registries. that have them. And so I'm not so sure that's been the problem all along, and I'm not so sure it's a problem that Google can overcome. And I think this probably fails if the big banks work more on what we saw this week, which is an announcement that they're going forward with email and text money transfers, which is also something that's been going on in third world countries

for a long time. I think the real takeaway here is that companies like Groupon who have a one-trick business model and don't have access to this ancillary information like Google or Facebook or others, they're dead meat. And if anyone can corner this market, it will be huge for them. Yeah, Google's going to be testing this in a couple of markets over the summer, starting with San Francisco in New York. James, what do you think? You know, as I understand, it says that this is limited to some particular model of Android phone that is so sparsely held that makes the Zoom look like a popular item. For now. So don't look for this anytime soon. But my bigger question is, what if you're

on a date and you run out of batteries? I mean, you can't pay, right? I mean, it's just kind of embarrassing. They have the, I believe, the chips are sort of passively energized. At least I think they are. I don't know enough about the exact technology, but my understanding of it the way it used to be is it works, is it worked the original versions, this worked like the timing chips in your shoe in a marathon or something. You go over the thing and it reads it.

Adding a layer of intrigue to Google's announcement was the announcement from eBay and its PayPal unit that they're suing Google. Why not? eBay and PayPal are claiming that Google poached two of eBay's senior executive. executives who then recruited other employees from eBay. The lawsuit alleges that Google used PayPal trade secrets to develop this mobile patent technology. Obviously, guys, we are not lawyers. We don't know all the details here. Everyone must say we should be glad we're not lawyers, by the way.

But let's engage in some reckless speculation, shall I? Let's do that. It's very bad on the surface. On the surface, it kind of does. It's kind of bad on the surface. It's Google, you know, there don't be evil models. I think that's kind of a joke. But I think you're going to see more of this going forward because the reality is Google is poaching employees from companies all over the place. Facebook is now doing as known as the employee poacher right now.

And when these people come with ideas that are going to compete, you're going to see more of these lawsuits. So we've got these various competitors who are all vying for our wallet. Bless their hearts. Bless their hearts, exactly. So if you had to bet on one entity to make this work, are you? betting on Google? Are you betting on eBay and PayPal? Or are you betting on the banks? Ron, what do you think? I think I'm betting on the banks ultimately. I think Google might have the first mover

advantage for a while, but then the banks probably move in at some point. James? I agree with the banks. Yeah, Google has a lot of power, but it might be its own undoing, too. I have to go with the banks unless it really morphs. And banks, especially the larger banks in this country, are not great at creating simple customer experiences. So if they screw that up, than a company like Google may have an open playing field. Microsoft was in the headlines this week, but not for anything the company actually did. Hedge fund manager David Einhorn said at an investment conference in New York City

that Steve Balmer should step down as CEO of Microsoft, saying, quote, his continued presence is the biggest overhang on Microsoft stock. James Early, two questions for you. One, who is David Einhorn? Two, is he right? David Deidhorn, Chris, is a young-looking hedge fund manager who is... Young-looking... I don't know why that was the first thing came to mind.

He is from his Greenlight Capital, and he's sort of a Warren Buffett meets activist type of investor, and he's been pretty accurate on a lot of things. Let me just back up. To its credit, Microsoft has a ton of cash and earns a ton of cash, and as a dividend investor, I become almost uncomfortably excited when I see its financials. Well, that makes me uncomfortable as well. Now, I know, we are in a new era of tech, and Balmer might be a little bit stuck in the past. I mean, names like Skype, Zun, Kin.

I mean, these were things that sort of bombed is Microsoft attempted to chase growth. And if you're late to the party with an also-ran product, you've got to be way better, not just comparable. So the point being is, I agree with Einhorn to the extent that Microsoft needs to just pull back and be what it is right now. This is a slower-growing tech company that's just making tons of care. Just enjoy yourself for who you are. That's not what he said, though. He complained that they had missed out on the phones, that they had missed out on the tablets. He said that the effort in search was a sinkhole.

Einhorn is so popular, especially among the value investors, and for being the guy who was shorting layman, very smart guy. So I'm not going to try to argue with him. I have his notes on his 2006 pitch for Microsoft, where if you read through them, you can find these on the Internet, you find out that Microsoft did all the things he says in 2006. He wants them to do, and it still isn't good enough. The reason he's at, let me give you a few snippets of this. First of all, here's my stock idea. Microsoft is A-Rod!

Exclamation point. He says that even supermarkets trade higher than this. He goes on to talk about the money-losing businesses, which at the time was Xbox and some of the MSN properties. And he says, these are big opportunities with continued growth. It'll overcome their fixed costs. He goes on to say that they have to try to compete in search, because what if they actually can stem. the bleeding. What Einhorn is doing right now, in my opinion, is he's a little crybaby because he got the valuation wrong. Here's the problem. Microsoft has doubled its free cash flow from

back then. It's increased operating income 60%. That's huge. What Einhorn got wrong is he expected people to pay 20 times earnings for Microsoft. If they did, this stock would be roughly twice as expensive as it is right now. People are willing to pay 10 times earnings for Microsoft for what reason we don't know. But Einhorn, I think, is just trying to make excuses for his own bad investment decision. And I have two final words from which are boo-frickety-hoo. Is that two words? That's actually slightly more than that.

Ron, Einhorn obviously has a stake in this. He's got about 9 million shares of Microsoft stock. Yeah, he's got some skin in the game here. It's his benefit to talk his book and to try to get that stock up. I agree with most of the things said, actually. Wow, really? Yeah, every now. Then.

Just to take the other side, though, I will say that Microsoft's board actually does, to a certain extent, agree with Einhorn. And if listeners will recall, Bomber had part of his bonus docked last year because he did fall short in things like mobile and coming up with new forms of computers. So there has been some monetary slapdown when it comes to his performance. When Bomber is no longer the CEO, do you think Microsoft looks to promote from within, or do you think they look outside the company? I think the smartest thing for Microsoft to do actually would be to break the company into pieces in some ways.

I think they would need to have some strong relationships, but eventually I think they're probably going to have to break apart the home entertainment and some of these other divisions. And that would present some challenges because a lot of the benefit of Microsoft is the way they can fit some of these pieces together. But it would also probably, hopefully anyway, kind of jump. start innovation at the individual units. Coming up, shares of Martha Stewart's company soared this week, and it had nothing to do with Oprah Endinger TV show. We'll explain in a moment. This is Motley Full Money.

Welcome back to Motley Full Money. Chris Hill here in the studio with Seth Jason, James Early, and Ron Gross. Shares of Martha Stewart Living Omni Media shot up more than 23% on Wednesday after the company announced it has hired an investment bank to explore a sale of the company. James, Martha Stewart is about to rejoin the board of directors after a five-year ban. How does she feel about this sale? Chris, that's sort of the critically important question, because she's trying to sell the company. It was once worth $2 billion, now a little over $200 million, more than that now since the announcement was made. But Martha controls over 90% of the voting power for this company. So I have to imagine that Martha is both the biggest detraction to a potential buyer,

but also the biggest deterrent, because whatever she says goes, at least for now. Ron? It's interesting to me. They held the CEO position open for her. There hasn't been a CEO for maybe since 2008, if I remember, and they held it open for her for when she could once again rejoin. And she said, no, I think I'm going to pass on that. I'm a little too busy promoting and cookbooking and all those kinds of things. So we're still left without a lead at the helm of the company.

What's this company worth? What are people seeing this company? First of all, it's kind of a dying business. It's magazine business. Second of all, how do you judge the long-term prospects when the only asset is this woman who's going to croak one? of these days. Seriously. Wow, that's kind of harsh on Martha.

She's turning 70. That's surprising. She's older than you'd think. Yeah. I really think this company has a 20-year horizon tops, and then it's gone. Rough week for Barnes & Noble.

The company introduced a new touchscreen version of its Nook-E reader that's smaller and cheaper than older versions of the Nook. Is that what you said? Shortly after that, Amazon unveiled a cheaper version of the Kindle.

Seth, can anything say Barnes & Noble? talk about a company with a tenure horizon, maybe. I don't know what you can do. I was looking at the margins, and Barnes & Noble's margins have just continued to get worse and worse. The story is e-books. They have no great leading position. I don't think anybody really needs the nook.

I don't think they need a touchscreen nook because it's actually easier to use buttons to turn pages on an e-reader anyway. And I think that they could probably survive with a tenth of the store selling only the kinds of books that people have to see to buy, but Amazon is selling more Kindle books than they are regular books. That's the way things are going.

Well, it's nice that when you go to the back of the store to get your Starbucks cup of coffee, there's all those books that you can sit down and read while you finish your latte. Yeah, that's nice. I read the 30-something percent of the e-reading books are romance novels. That's really been the genre driving that service. Get the heck away from my Kindle, you perv. It was another tough week for people who argue that we are not seeing another tech bubble. Yandex, the number one website in Russia, went public this week, and shares were up 40% on the opening day.

Also this week, Zinga, the online game company behind Farmville, is reportedly gearing up for an IPO of its own. Ron Gross, what do you think? Tech bubble 2.0? Let's differentiate between a tech bubble and a social media bubble, because I think we do have a social media bubble forming, which is interesting to me. What's most interesting about it is that it's creating value elsewhere. So people want the Facebooks and the big, you know, LinkedIn, hot IPOs, double my money real quick. And it's leaving companies like Microsoft, HP, Intel, Cisco, even Google, trading at what people now consider it to be value prices.

So money is moving, hot money is moving into these, you know, social media areas. Traditional big cap tech is getting hurt as a result. And there could be some opportunities there. Yeah, it's kind of nuts. I mean, what is Zinga going to fetch? They've got a few games that are popular now. but they're equivalent of a 1980s Atari in terms of graphics and sophistication. And it's a video game company for crying out loud.

Those things always go on to bomb. But a company like Google or Microsoft, Microsoft's trading it 10 times earnings. I think I know which side of that bet to take. Shares of Tiffany up this week as the company reported earnings up 26 percent and raised guidance for the year. James, how they getting it done? Chris, a lot of their stores are, well, actually, Asian Pacific revenues are up 37 percent, which to me is the big news. quarter of Tiffany's stores are in Japan, which sales were there were up 7%, which is really good.

All the stores there have reopened now. So it's all surprising to me because Asians as a whole, these Asian nations tend to be big savers. But when they do splurge, they splurge on these super high-end brands that even most Americans won't buy. So it's kind of intriguing. I wouldn't buy a Tiffany's product. My wife isn't listening, but I just wouldn't pay that much money. But they do over there. Shares of Krispy Cream jumped 21% on Monday after the company reported its strongest

quarterly profit in seven years. Same store sales up nearly 6%. The 10th consecutive quarterly increase. Ron. Creeping its way back. Wow. Back from the dead. It's not a fraud this time, right? Right. Three billion dollar company down to a $500 million company. Had some SEC trouble, had some accounting trouble. Didn't file its cues. Fighting its way back now. But man, those donuts are tasty. Exactly. Same store sales are improving. They're slowly making their way back. and, you know, good for them. It's not the high-flying stock it once was, but it shouldn't have been in the first place.

Does this bode well for the eventual Dunkin' Donuts IPO that I just can't wait for? It depends on what kind of social networking add-on we've got with Dunkin' Donuts. Do you patronize Krispik cream yourself, Ron? I don't actually go into a Krispy Kreme, no. If you hand me one, I will go outside and sell someone else. I'll happily part-ting. I'll say, what, you have a guy who goes for you?

You got a bagman or something? And finally this week, the Walt Disney, company has withdrawn its application to trademark the term Seal Team 6, the name of the elite Navy unit that took out Osama bin Laden. A Disney spokesman said this was done, quote, out of deference to the Navy. Apparently, there was no difference to the Navy when they were actually filing the first time around. Guys, clearly, there's a hole to fill here for Disney in terms of a tacky trademark. So if Disney brings you in and says, we need some advice, What's something we can trademark and go after that's maybe on the edge?

Ron Gross, what do you think? I know my daughter would love to walk into a Disney retail store and just purchase one of those Lindsay Lowen ankle bracelets. Sweet. Nice, nice. Seth? I think, you know, if they want to try and trademark something that's obviously so public that it should not be trademarkable, they might as well go with, you know, BFF or something

like that, because not only is it best friends forever, is it very popular, everybody knows what it is, but it's also Pass A, which is. something I associate with Disney. Oh, M.G. What a great idea. Seth, Jason, James Early, Ron Gross, guys. We'll see you later in the show. Memorial Day weekend is the traditional start of the summer movie season. Coming up next, we've got Nell Minow to talk about the business of the film industry,

as well as which movies you can't miss, and a couple that you probably should. Stay right here. This is Motley Full Money. Welcome back to Motley Full Money. I'm Chris Hill. Business Week has called her the Queen of Good Corporate Governance. Nell Minow is with Governance Metrics International, and when she is not handing out grades on corporate America, she's reviewing films as the movie mom. Nell, welcome back.

Thank you. Pleasure to be here. Always good to talk with you. We will get to movies in a moment, but I want to start with some corporate governance. This week, the SEC approved a plan that is going to reward whistleblowers for exposing fraud. Whistleblowers will be entitled to anywhere from 10 to 30 percent,

of the money that they helped the SEC recoup. So potentially some big rewards. What did you think? I mean, I'm assuming you were very much in favor of this. I am much in favor. How's that? Not very much in favor. Yeah, I think it's a very good thing.

Talk about pay for performance. This is a system that has worked very, very well in terms of return and investment for the IRS, and I think it will work very well for the SEC, too. The problem is, of course, the perverse incentives, and any time the government has tried to set up some kind of protection for whistleblowers, it has turned out to be a double-edged sword. However, given that the SEC does not have the resources to do all of the investigations that it needs to, essentially deputizing corporate insiders, I think is a very, very good way to go. If you think about some of the biggest corporate scandals that have been uncovered, very often there was somebody on the inside. You think about Archer Daniels Midlands, for example.

And so I think this is going to be a very good thing. But obviously we're going to get some false positives and some abuse of the system as well. Well, and you mentioned the limited resources of the SEC. Should that be a concern? Because if the SEC isn't able to staff up and get the resources to staff up, Couldn't this backfire if they're just deluged with potential whistleblower opportunities? I think they'll be able to tell the difference between the people who are trying to get back at their boss and the people who've got some hard evidence. I think you can separate those out very quickly, and so I don't think that that will be a big problem.

You're listening to Motley Full Money. We're talking with Nell Minnell from Governance Metrics International and also the movie mom. Let's move over to the business of movie making. One of the big players in the movie industry nowadays is, of course, Netflix. For the average movie studio, do you think they're seeing Netflix as a friend or a competitor? The smart movie studios are seeing them as the best friend they could ever have. every single time there has been some new delivery system. The movie studios have taken much too long to understand that this is a way of expanding their audience, not cutting into it.

Remember when television came out, one of the things I really enjoy is watching some of the movies of the 1950s and their fruitless attempt to try to make television look bad, and when television started showing movies, they didn't realize what an incredible market that was going to be for them. When video machines came out, they tried to fight them. And it's always very good news because the question is how many delivery systems you're going to have for the content that always benefits you. People want to watch movies on their phones.

They want to watch movies on their tablets. They want to watch movies. You know, someday it's going to be on their watches and maybe on, you know, the inside of their eyeglasses. And that's always going to be good news for the movie studios. And the sooner they recognize that, the better. Here's a question about the financing of movies, because there was a report that came out by Brand Channel, said that Apple was the number one company last year in terms of product placement in movies. Is that really the wave of the future product placement in terms of financing for movies, or does it get to a point where it just undermines the quality of the film? I think it does get to that point where it undermines the quality of the film.

It's one thing if you want to say something about your character, that this is a character who would use an Apple rather than a Mac, but it does get to be very intrusive. I really recommend you the documentary by Morgan Spurlock, the Super Size Me Guy, that he did on this subject. It's called Palm Wonderful Presents, the greatest movie ever sold. He actually sold the naming rights in the title to Palm for a million dollars, and it was completely financed through product placement.

And so he takes you through that process. And it's absolutely fascinating. You don't realize how pervasive it is. You're listening to Motley Full Money talking with Nell Minow, corporate governance expert and film critic. In addition to those two jobs, if that's not enough, you also do a fair amount of blogging. And you recently wrote something about a piece that was in The New Yorker regarding Pixar's success in terms of, of the way they do business. Could you share a couple of the business lessons for managers from that?

Yeah, that's one of the things that fascinates me about Pixar. Pixar is the most successful movie studio ever, and one of the most successful businesses ever. Just to give you an idea, there's only one other studio in history that has not had a single money loser that has batted a thousand, and that one had very, very thin margins.

This is a movie studio. where every one of their movies has made substantially over $100 million. Every one of their movies is in the top box office films of all time. And not only that, they really set the bar very high for themselves, unlike, say, their current parent Disney, which did very, very well with movies based on pre-sold characters. Everybody knows who Cinderella is. You're already interested in Cinderella and want to see the movie. Pixar really created their own world, their own characters.

We had to fall in love with these people every time. And so it's really interesting to see what it is that has made them different. One of the things that was in the article in The Yorker is that he mentioned sort of casually that they were on their 3010th filming of a particular scene, that on a good day they managed to produce two seconds of screen material. And it's that meticulous attention to detail and that understanding that it's the story that matters, that just because you know how to make things blow up in a cool way on screen, that's not enough to sustain a movie for more than a week in the theater, that I think that that's very important.

And another one is that they really, really like each other at Pixar, and I recommend that everybody take a look at the Pixar entry in that great series of It Gets Better about protecting bullied kids, and you just get such a sense of the affection that the people in that company have for each other, and that, of course, shows up in screen, because that's what they're able to convey between their characters, whether it's a little boy and a crabby old man or a cowboy and an astronaut. You're listening to Motley Fool Money talking with Nell Minow from Governance Metrics International

and, of course, the movie mom. Before we wrap up with Buy-Seller Hold, the Memorial Day weekend obviously kicks off the summer movie season. So want to get your thoughts on some films involved in the summer movie season. First, are there a couple, you know, there's some. many blockbusters that are hyped. Are there a couple of movies this summer that you're particularly excited about? Yeah. Now, people who have no life have already counted up and discovered that 2011 is breaking the record for sequels. We have 27 sequels coming out this

year. That's more than one every other week, three just in the last two weeks together. And some of them, I'm certainly looking forward to. Obviously, I want to see the last one of Harry Potter, and that's going to be great. I'm looking forward to the big comic book movies. I think Captain America looks terrific. Green Lantern looks great. So those are wonderful. But I have to say I'm especially intrigued by a couple of the smaller films that are coming out. One is called Crazy Stupid Love with Steve Carell,

and in his first real all-out comic performance, Ryan Gosling, who I think is one of the most talented actors working today. It's also got Emma Stone, who I think is going to be a big star. She is a big, big, big by this year. She's not only going to be in that movie this summer, but also the help. And I think between those two, you're going to see her rise very, very high in the most marketable young actresses category. So I'm looking forward to Crazy Stupid Love.

I'm looking forward especially to Larry Crown with Tom Hanks. One of my favorite movies the last 15 years was the only movie that he's directed so far. And this is now his second one, which he co-wrote with Nea Vardelos of My Big Fat Greek Wedding. And it co-stars Julia Roberts. So all of those elements together, you know, it's a real dream team. Yeah, it's pretty good when you're Tom Hanks, when you can co-write a movie directed, and then you just decide that your love interest in the movie is going to be Julia Roberts. I think they liked working together in Charlie Wilson's War, and the trailer just looks terrific.

And now what about one, give me a prediction for one bomb. And I'll just spot you up with one name, and that's the Smurfs. I just, I don't know. Hey, I hope so. That's, yeah, I'm just not buying the Smurfs. I hope so. It does not look good. And I think maybe the zookeeper may not do very well.

Last year at this time when you and I spoke, I spotted you up with a competition between two sequels, and that was Iron Man 2 and Toy Story 3. And you said Toy Story 3 was going to be a bigger hit. You were absolutely right. So let me give you the same construct. All right. Pirates of the Caribbean 4 against Cars 2. Which one's going to be a bigger hit?

Oh, I'm going to go with Cars 2. I think Cars 1 is not one of my favorites of the Pixar releases, but Cars 2 does look absolutely sensational. It's got a wonderful cast, including Michael Cain and Emily Mortimer. They have really, really worked hard on the characters, and it looks sensational. You're listening to Motley Full Money talking with Nell Minow. Nell, we're going to wrap up with Buy-Seller Hold. First up, he's generated a lot of controversy in recent years and recently appeared.

in Jody Foster's film The Beaver, buy-seller, hold, the future of Mel Gibson. I'm afraid he is a cell, if he's not in the pink sheets already. I think that I remember that I was at the gym and telling the ladies at the gym that I was going to go see that film that day and interviewed Jody Foster.

And every one of them said, I will never go to another Mel Gibson movie. So not good right now. Amazon now says it is selling more e-books than actual books, buy, sell or hold, the Kindle. The Kindle is a strong buy. I think it has definitely that first mover advantage. The Nook is a better machine,

but the Kindle has more content by a factor of tens of thousands, and it is just penetrated the market that I think it's here to stay. She is one of the biggest stars in the world, and she was the first person to amass more than 10 million followers on Twitter buy-seller-hold, Lady Gaga. Lady Gaga is a marketing genius. Everybody should take a look at what she does. That new chrome commercial makes me cry that she's got

because of the way that she reaches out to her fans. They love her, she loves them. I think Lady Gaga is terrific. This film just took top honors at the Con Film Festival, buy-seller-hold, tree of life. I'm afraid that's a sell. I have seen it, and I think it is just too quirky and weird to make much money at the box office. I don't think the marketing people for Tree of Life are going to want that quote for the poster.

Well, this is a movie with Brad Pitt, and Sean Penn. Sean Penn has barely a line of dialogue, and it has a dinosaur in it that's sort of random. I mean, an actual dinosaur. There's a dinosaur? Yes. There are two actually two dinosaurs. Yeah. Do they have any lines of dialogue?

They have no lines of dialogue, which puts them on a par with Jessica Chastain, who's also in the movie and has really almost nothing to say in the movie, but it's going to be a big star someday anyway. And finally, he made his first TV acting appearance in a decade on the season finale of the office, by Seller Holt, the acting career of Warren Buffett. Oh, please, no, I don't want him to do anything. But he killed on that show. He was great, was he.

He was absolutely sensational. His delivery was impeccable. He was better than Jim Carrey. He was better than Ricky Jervais. I nominated him for an Emmy for that performance. I just fell on the floor. I didn't know he was going to be on. And he was, he nailed it. He nailed it. Nell Minow is with Governance Metrics International. She is the movie mom, and she's absolutely one of our favorites. Nell, thanks so much for being here. My pleasure. Coming up, we'll give you an inside look at the stocks on our radar. This is Motley Full Money.

As always, people on the program may have interest in the stocks they talk about. And a motley fool may have formal recommendations for or against, so don't buy ourselves stocks based solely on what you hear. I'm Chris Hill, and back in the studio with me, our trio of senior analysts, Seth Jason, James Early, and Ron Gross. Guys, time once again for the stocks that are on our radar. And we're going to bring our man Steve Brodo in from the other side of the glass to grill you individually with a question.

Ryan Gross, you're up first. I'm a big fan of a lot of. a company called Lumber Liquidators, ticker symbol LL. It's a stock we own in the million dollar portfolio service. They're a hardwood flooring company, about 240 stores in the US, a few in Canada. Really good return on capital, plenty of growth ahead of them. They could double their store count over time. It looks really inexpensive at current price, so we like it very much. Steve, what do you think? Question about lumber liquidators? You bet. How does weakness in the housing market, how might weakness affect lumber liquidators?

Negatively, quite frankly. Negative weak economy and weak housing market would have an effect. People do undertake remodeling efforts sometimes rather than move in weak housing markets, but I don't think we can fool ourselves. It would not be a good thing. And just to mix things up, Ron, a question for Steve. It can be about anything. Hmm. She's become quite a celebrity, I think, ever since this show aired. And I think America wants to know, Steve. Boxers are briefs. As if you don't know. Boxer breeze.

Box, oh, a little bit of both. It's the, yeah, it's a winning combo. It's the best. I have to agree with that. The best of both worlds, isn't it? Absolutely. But he doesn't mean that thing that's both in one. He means a pair of boxers over a pair ofers.

Belts and suspenders. Sorry, ladies, I'm married. James Early, stock on your radar this week. I am going with Clorox, whose lung tissue destroying bleach products I frequently used to clean my shower despite the two-day cough afterwards. It just raises dividend by 9%. It pays a 3.2% yield. It also makes Hidden Valley Ranch, salad dressing, the Burt's Bees products, Kingsford Charcoal, a bunch of other things. Carl Icon, corporate Raider bought a little over 9% earlier this year, so people see that as a positive catalyst.

Once again, I love that you've chosen a stock that seems to be completely at odds with your lifestyle. Steve, a question for James about Clorox. Absolutely. Do you feel like the move towards more environmentally friendly products might affect a company like Clorox that does rely so heavily on harsh chemicals? They are trying, actually. They have some green products. They sort of has some trouble getting those into Walmart, but it could actually help them because they already have the established relationships with the vendors.

James, question for Steve? Steve, you were to ride a two-man luge with one of the following, Chris Hill, Seth Jason or Ron Gross. Who do you pick? And where do you sit? You're the back. Is this the Olympics? This could be anywhere.

Steve, it should be me. I've actually luged before. I think I'm going to have to go with Seth because he's actually luged before. Yeah, but Seth's also the tallest of the three people. That's true. That's less room for you. Yeah, it is less room for me. Would you rather lean on him or be leaned upon by him?

The whole situation is awkward, so I think it just closed my eyes as well for the best. The word luge is a little awkward. That's, that's, I mean, come on, let's face it. That's the best Olympic winter sport. In all seriousness, lushing is really fun. Because of the danger factor? Because you're going so fast, and if you don't do it the way they tell you to, you crash and it hurts. So you better do it right.

It sounds like luge is fun. to watch, but I don't know. It's more fun to do. I swear to go. Seth, Jason, your stock this week? Well, I am going to go with guess, which everybody has heard of, and it's a stock that hasn't gotten a lot of respect. It gets a lot of 80s jokes. Came out with earnings. Gee, I wonder why.

This week, and they were much better than analysts expected. Cops store sales slightly down in the U.S. But the real story is that just going gangbusters overseas, they have a ton of room to sell more product in Asia, but also in Europe. where the brand is actually very well known. So it's a fairly easy, or, as they say, a short putt for them to continue with these big sales increases. And the ticker symbol? GES.

Steve, a question about guests? Sure, which is more important? The guest branded stores or the fact that guests products are sold and so many other retailers like Macy's and Nordstrom, that kind of thing. Both are important. It's a two-piece strategy, and I think you can't have one without the other. They started out, of course, just with the wholesale sales and their products selling at department stores. Since they took over and did more of their guest branded stores, it raises brand awareness a little bit more. And, of course, the picture is even a little bit different in Europe where they have licensed stores,

and they don't have the reliance on department stores that they do over here. But they've pursued this kind of multi-channel strategy for a reason, and it works, and it gives them a diversified base. Is that the question for Steve? Steve, we've been talking about acid wash. How many pairs of acid wash were you rocking back in the day? You know, I never really got too heavily, and I distinctly remember one pair, and I remember my sister and me trying to acid wash our own jeans in the sink with bleach, and it ended poorly. Did it end with holes with bleach burns? No, they just look really ugly.

How'd that go over with mom and dad? I don't know. You know, it was, we were young, it was fun. Did you ever have a denim vest just as a related question? No, but it would mean A dead of a? But it sounds great. How about chaps? No chaps.

No chaps. Not, not, but one day, dare to dream. Final question on denim. Did you ever rock the denim suit? The jean jacket while wearing jeans. I don't think so, but it's possible. Who here did? Come on.

I did. I might have. I don't know. I had the jean jacket. Oh, no. I think I didn't have the denim suit. My mom probably got me one when I was a kid. But I'm not, but it's like the inadvertent denim suit.

Like you're wearing jeans and a t-shirt and then you throw your jean jacket on. I had that in there. And the mullet. The mullet, too? I had a mullet, too. No shirt underneath. Wow. Wow.

On that disturbing note, Seth Jason, James Early, Ron Gross, guys, thanks for being here. Thank you, Chris. Thanks to our special guest this week, Neil Minow. For commentary and analysis each day throughout the week, check out the Motley Pool's website, Fool.com. Our engineer is Steve Roydo. Our producer is Mac Greer. I'm Chris Hill. Thanks for listening.

We'll see you next week.