Motley Fool Money - Motley Fool Money: 6.18.2010

Episode Date: June 18, 2010

BP agrees to set up a $20 billion escrow account. The price of gold hits an all-time high.  Facebook's COO questions the future of email. And Starbucks announces plans for free WiFi.    On this week's show, we tackle those questions, talk BP with The Motley Fool UK's David Kuo, and share three stocks on our radar. Learn more about your ad choices. Visit megaphone.fm/adchoices

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Welcome to the show. Thanks for being here. I'm your host Chris Hill, and I'm joined by Motley Fool Senior Analyst, Seth, Jason, James Early, and Shannon Zimmerman. Guys, good to see you. Good to see you, Chris. On this week's show, are gold prices going even higher? Is it time to invest in an RV?

And do bags still fly free on Southwest if the bags in question contain 45 human heads? We'll tackle those questions, get a British perspective on the oil spill, and share a few stocks on our radar. But we begin with the week in BP. On Thursday, BP CEO Tony Hayward told Congress that the explosion and fire never should have happened, and that he was, quote, deeply sorry. Not to be outdone, Joe Barton, the ranking Republican on the House Energy and Commerce Committee, Also apologized, saying that the White House pressure on BP is a, quote, tragedy of the first proportion. Earlier in the week, after a meeting with President Obama, BP executives agreed to put $20 billion into an escrow account to be administered by an independent third party.

And the company also suspended its quarterly dividend. Seth, Jason, obviously, there's a lot there. You're a BP shareholder. What was your take on the week? Well, I think that's just exhausting. I know. It's exhausting even if you're not a BP shareholder. I think the news outlets are even getting bored with this. I thought the $20 billion was an okay compromise. I think it is a bit of a shakedown because there was no evidence at all that BP would be unable to pay those claims. So I think this is BP giving in in order to try to avoid sort of a President O'Chavez situation down the road. And cutting the dividend three quarters, that doesn't really make a, that doesn't really make a. a whole heck of a lot of difference. The thing, again, throughout this entire affair that astounds me is the ignorance of our elected

officials. I mean, they were grilling the CEO and trying to castigate him for not taking a personal hand in well decisions. And of course, this guy's running a company worth billions and hundreds of billions of dollars, and that's what the engineers are there for. So there's a lot of shunuchs. showmanship going on. I think it's pretty ugly, and I just can't wait until it's all behind us. James Early, you're a dividend guy. What did you make of the decision to suspend the dividend?

Well, you know, I think it's the right thing to do given everything. I mean, from a PR standpoint and from a financial standpoint, BP has about $5 billion in cash, about $5 billion in untapped credit lines. So they're probably going to have to sell another $10 billion in assets, according to least to the financial times that makes sense to me. I think the saving grace for BP, just to extend the question, is going to be that these costs will probably come over many, many years. But it's a lot of money. It's a lot. Yeah, and the thing that is still an open question is whether or not criminal charges will be brought. That will change the math of all of this.

I agree with James that from the PR point of view, it's a smart decision for BP to do this. As Seth said, there's no indication they wouldn't be able to make good on these claims anyway, but as a way of showing regret, remorse, it probably is good theater for BP. Well, and speaking of theater, I mean, that hearing with Tony Hayward was something else. We've seen more than our fair share of hearings because we're right across the river from Washington, D.C. Our friend at the Washington Post, Frank Aaron, is one of the best business reporters going. One of the things he reported, it was 83 minutes into the hearing before Tony Hayward was able to speak. How many minutes before Joe Barton apologized?

I mean, apologized for the apology. It reminds me of everything you need to know about what these hearings are about. They're about politicians getting their sound bites in front of their constituents with their righteous anger. They're not really after answers. But the Barton thing was just hilarious to me. Remind him you of the guy that Dick Cheney shot in the face. He apologized for all the trouble that he'd cause Dick Cheney. All right.

So going forward, we've talked about this the past few weeks. As an investor, what does BP stock look like to you? Are you thinking about buying even more shares, Seth, Jason? Well, I have kind of the two-thirds of the position that I would consider. watching and waiting a little bit. As I spoke about last week, I bought a basket of other companies in this space. And I would probably consider adding that there, but I'm sort of waiting around to see if there's another kind of Armageddon situation. I still think BP is a good buy, but there are those risks that we do get O'Chavez on BP and try to kill itself.

I think this is the financial analyst thing doesn't work out. You should go down to Texas and run for office because it's a little bit crazy what's going on. So there's a financial analyst. is the risk that BP gets completely crippled. Of course, on the other hand, if they cut BP off too much, then there's nobody to pay for that cleanup. James? I would not touch the stock with a 10-foot pull still. I mean, the two biggest risks we have are, one, politics are very unpredictable, and that's what we've got. And the estimates for how much oil is gushing out, just keep rising and rising and rising. So until we get a handle on that, it's just too risky for me. We might want to mention they're actually capturing an awful lot of that now, and expect to capture

an awful lot more, but nobody's remembering that. In an op-ed for the Wall Street Journal, Alan Greenspan, said the U.S. may soon face higher borrowing costs on its growing debt. The former Fed chief called for a tectonic shift in fiscal policy to contain borrowing. Shannon Zimmerman, what did you think? How much more tone-deaf could you possibly be? And why is anybody asking Alan Greenspan anything now? It's like asking Mike Brown how Obama's doing on the oil spill after Katrina. To me, it's a piece with what's going on and lots of very serious meetings with very serious people

about the need for austerity and to dial back spending to address deficits amid mildly deflationary times. And the problem isn't borrowing costs. The U.S. can borrow money at remarkably low rates. And to the extent that we do pull back and have austerity, well, what are you going to do? You're going to have more people unemployed because a lot of folks are employed today simply because of government stimulus spending. And if you have more people unemployed, you have less in tax receipts. It's just the wrong way to go. James Early?

You know, I think it's a great idea for 10 years ago. It makes a lot of sense. You mean like when Greenspan was running things? Exactly, without a low interest rates, yeah. You know, I'm a little, I guess, to the right of Sven here in thinking that I do think we do risk inflation. I do think we have a huge Social Security obligation. And, yes, deflation is the problem right now. But once that problem gets resolved, we have a big inflation problem and a big credibility problem.

Seth, Jason. Last I checked, people were rushing to buy treasuries at abysmal yields because they would rather be in U.S. treasuries than in just about anything else right now, which tells you that people are willing to loan us money at horribly low interest rates because they trust us more than they trust almost anyone else to pay that money back. That's exactly right. If people are deferring to the market, well, the market's saying, hey, don't worry about this. That's just because we're the least drunk driver on the road. But that's a great position to be in. Whether it's China or something, you know, that could take our hegemony.

You're listening to Motley Full Money. We're going through some of the headlines this week. Gold hit a record high this week at just under $1,250 and outs. And guys, you've all been pretty skeptical about gold, and it just keeps going up. So, Seth, Jason, do you want to take a moment and apologize to my favorite precious metal? Oh, yeah, and I would also like to apologize. I apologize to all those people who went to the casino who won money because, you know, you beat the odds, therefore it was a correct decision. Now, the reason gold is going up is, as we've discussed before, there's a fetish for it right now.

And because you've got these geysers like Greenspan telling you that there's this hyperinflation coming, right now there's a huge industry out there, pumping gold. And it's a really strange cultural phenomenon. We don't have any evidence that inflation is coming. Gold is not necessarily a decent hedge against that unless you've got bars in your basement that you think you're going to swap for chickens and Alpo when you need it. So, you know, hey, gold bucks, just go have your fund. The rest of the world is going to operate over here in reality. Just email us, Goldbugs Radio at fool.com.

It is bizarre. I mean, we've made this point before, that you have treasuries tracking up and gold at the same time. Those things should not correlate. And the fact that they are, something bizarre is happening in the... the gold space. Coming up, AOL demonstrates a fast way to lose hundreds of millions of dollars, and Starbucks makes it more enticing for people to just hang around in their shops. Stay right here.

You're listening to Motley Fool Money. Welcome back to Motley Full Money. Chris Hill here in the studio with Seth, Jason, James Early, and Shannon Zimmerman as we dig into some of the companies making headlines this week. Fannie Mae and Freddie Mac are being delisted from the New York Stock Exchange, and the stocks plummeted on the news. James Early? Was this the right move?

It was, Chris. Apparently, these entities were evil agents of doom all along, just contributing to froth and instability in the housing market. Come on. You're a loser if you don't buy a house. And they're going to require the biggest single bailout in U.S. history for an entity, it looks like. The Congressional Budget Office says $389 billion in subsidies through 2019. That's assuming housing prices don't drop.

If they drop, it could be even more. So we as taxpayers are on the hook for a lot here. Are you saying that, because on last week's show, one of the things we talked about was our engineer, Steve Broido, is in the process of buying a house. Are you saying that Steve was essentially pressured? He may have been brainwashed. Steve, how are you feeling? It's going okay. We're now trying to sell a house, too.

So if anyone's interested, please do you know it. Drop us an email, radio at full.com, if you want to buy Steve Broido's house. Seth, what did you make in the news? To me, the takeaway is that even the most incredible business model in existence where you get low-barrow. borrowing costs and a government guarantee, it can still go wrong. Even if you had, you know, monopoly or duopoly position, I think that competition finally crept in. And then there was this incredible hubris coupled with a bit of ignorance and management. They made the same mistakes that a lot of others in that space made, which was building awful models based on outdated

misconceptions about what people could pay back. But, you know, these, Fannie, I believe, was an $80 billion company, and it's worthless in a matter of years. And let's remember here, housing is not that great of an investment overall. I think it's about a 7% return on like a multi-decade average I've seen, even with Fannie and Freddie. So this idea that everybody needs to buy a house, I just don't buy it. A good week for Winnebago. RV sales were a big third quarter revenue nearly tripled, and the stock was up on the news. James, I'll be honest, I didn't even know Winnebago was a public company, But you're the gearhead around here.

What did you make of the earnings? Chris is actually a pretty good public company. And what's neat about these earnings is Winnebago sold a lot of the biggest, most humongous, you know, the bus chassis units, too. Stock was up 11 percent. It's up about 180 percent from its April of 2009 lows. You know, Winnebago, like I said, it doesn't have a lot of debt. It's riding a baby boom demographic that's nice.

And interestingly, according to Morningstar, more than 20 percent of U.S. households intend to purchase an RV, which frankly surprised me. What was that percentage? 20%, Chris. One in five people that owns a high-R-V area. I don't think we're in a high-R-V area, but maybe they're like all the rage. I think our economy is fine if 20% of the people in this country

have $150K to spend on a giant RV. AOL announced that it's selling social networking site Bebo for a reported $10 million. That's a lot of money until you recall several weeks ago when we discussed on Motley Fool Money that AOL bought Bibo a couple of years ago for $850 million. Seth Jason, where did it all go wrong for Bibo? If I'm doing my math, right, they made 80 times their money?

Yes, only in opposite world. Wow. You know, there were a lot of social media sites that nobody remembers anymore. There was the Friendster. We had the GeoCities, and Microsoft has a horrible attempt at one. It's kind of strange to me that everything sort of settled out on. on Facebook and Twitter because, of course, MySpace was a huge thing, and I don't know, my space seems to be struggling right now.

But I don't know, before we're too hard on AOL, I guess, you know, they felt like they had to be in that space, and there was probably somebody pushing and saying, we've got to do something, even if it's a terrible decision. By the number five player? Yeah, yeah. Despite the fact that there's no evidence that even the major players, companies like Facebook and Twitter, can actually create long-term business models. that pay investors.

Well, speaking of Facebook, Facebook chief operating officer, Cheryl Sandberg, says she thinks email is obsolete and, quote, going away. She cited a study saying only 11% of teenagers use email every day. Seth, she may be a bit conflicted, but you're not. What's your take? Well, here's the thing. I think that we can also say that there are a lot of other products and services that are obsolete based on the fact that only 10 or 11% of teenagers use them. one might be soap. The other could be after-school jobs.

Not that Axe body spray, though. Yeah, Axe body spray is probably the wave of the future. Vegetables? Vegetals are going to be obsolete? Yeah. They already are in my house. Yeah, Whole Foods is going to go bankrupt because only 10% of teenagers actually care about fresh produce. Twitter has become a big hit in Japan

where the word tweet translates to, and we're not making this up, Mumble. Twitter arrived in Japan in 2008, and now around 16% of Internet users in Japan, tweet, excuse me, mumble, compared to around 10% of Americans who tweet. One reason for Twitter's appeal in Japan, it's possible to say much more in Japanese with Twitter's 140 character limit. For example, the 11-letter word information requires just two letters in Japanese, and frankly,

that just seems slightly unfair. That's totally unfair. We need Congress to look into it. I think the Japanese should only get 20 characters for their tweets. Starbucks will start offering Wi-Fi at 6,700. of its locations beginning July 1st. Shannon, I'm a Starbucks shareholder. How excited should I be about this?

You should be very excited because you finally figured out what I've known all along. Loafing can be profitable. It's a great idea. I've been in love with my iPhone ever since I got it. But the login process to get on the networks at Starbucks was for a while quite complicated. That's all apparently going to go away. And all the internet you can eat, all the coffee you can drink, it's a great combination. But as a shareholder, I want people just in and out.

I don't want you bums just loafing around myself. No, they sit there and they order more stuff. Exactly. Yeah. Is James, really, you agree with that? You know, I do. And I think Wi-Fi needs to be a commodity these days. I was actually, Chris, in your home state of Maine.

And, you know, the Holiday Inn Express has free Wi-Fi, but then this fancy hotel didn't. So I called up and threatened to leave and they gave it to me. Very nice. People need to wake up. Should McDonald's follow suit? They already have. It's free there, too. All over the place?

I believe so. Oh, my God. There's just going to be loafing everywhere. It's like Europe over here now. All right, over the next five years, McDonald's or Starbucks? What do you think, Shannon? Oh, always McDonald's. Always?

Yeah, if you're going to give you that kind of choice, the binary between a relatively, well, always pick the unhealthy choice. James, you're the most healthy person here. Me too, I go with Shannon. Do you find, like, an inner turmoil because you live such a healthy lifestyle and you just constantly invest in things that are unhealthy? I have to be intellectually abstract about it, but I do, yeah. Okay, so inside, there's just rage.

Almost a rage. Not a lot of profit and trail mix? Just beneath the surface. Seth, what do you think? Oh, you have to say McDonald's. McDonald's can continue to do business all over the world, whereas this kind of fake Italian coffee bar thing we've got going at Starbucks, is it only going to play in a very few countries.

Guys, just in time for Father's Day weekend, we close with this feel-good story. Last week, a Southwest Airlines employee opened three suspicious boxes at Little Rock National Airport and found four four. 45 human heads bound for a medical lab in Fort Worth, Texas. The heads were to be used to help train neurosurgeons. Now, body parts used for medical purposes are commonly shipped by air, but these boxes were not properly labeled or packaged,

so that's something for all of you out there to keep in mind when you're packing for your summer vacation. Heads are going to roll over. You had to be the one to save. I had to do it. Without really delving into the whole human head thing, let's go the airport route. most interesting or unexpected discovery you've made at an airport?

I discovered Iggy Pop in the airport at Atlanta, and he was in a suit. I mean, you look like a respectable businessman from shoulders down, head up. I think that's probably rarer than human heads. I think so. Celebrity signing. Iggy Pop all dressed up. Steve, what about you? It wasn't actually me, but my father was held in some European airport.

He had a 70s mustache, and he looked a lot like a terrorist at the time. and me and my mother were detained, and it was a very, very funny story to hear. I think that's another lesson out there. Just avoid 70s mustaches altogether. It was the 70s. It was the 70s. All right, all right. Then that's defensible then.

All right, the guys will be back later in the show to discuss the stocks that are on their radar. But drop us an email at Radio at Fool.com. Send us your questions, share your travel-related horror stories, whether they involve human body parts or not. email us, Radio at Fool.com. Come fly with me, let's fly, let's fly away. If you can use some exotic booze, there's a bar in far Bombay. Come fly with me, let's fly, let's fly away. Come fly with me, let's float down.

Coming up, financial commentator David Quo joins us from London to share how the BP oil spill story is playing over there. Stick around. You're listening to Motley Fool Money. Welcome back to Motley Fool Money. I'm Chris Hill. In 1997, the Motley Fool established its first international presence with the launch of Fool UK. Joining me now from Full UK headquarters in London is David Quo. He's seen regularly on the BBC, Sky and CNBC Europe. And he's the host of the Fool UK's weekly investing podcast, Money Talk. David, great to talk to you. And you, Chris. So let's talk about the company of the hour, of the week, of the month, and that's, of course, British Petroleum.

You're making, Chris, you're making the same mistake as everybody over in America is doing. And you're calling it British Petroleum. It's no longer British Petroleum. That is what's causing this rift between this side of the Atlantic and your side of the Atlantic. It hasn't been British Petroleum for 10 years. And because Barack Obama, President Obama called it British Petroleum. of the politicians in this side are up in arms, Chris. Well, that's why we're talking, David,

because I'm keenly aware of what the perception is here in America, but in the UK, what is the perception about BP and the oil spill crisis? Well, you know, when you open the papers on this side, Chris, it's very difficult to tell who the victim really is. I mean, we all know that this is massive, massive oil disaster over in the Gulf of Mexico, the Deepwater Horizon disaster. And yet on this side, it feels as though we're, the victims. It feels as though we've been pinned down by the American politicians, by the American

president, and the American people, blaming BP for the disaster in the Gulf of Mexico. And of course, you know, BP is to a certain extent culpable. There was this oil spill, but I think the problem was that BP handled it very badly. I would say so. I mean, just recently, after meeting with President Obama, BP's chairman, Carl Heinrich Svonberg, said that BP, and this is his direct quote, BP cares about the small people. Now, to be fair, he's Swedish. English is not his first language, but when you take a quote like that and you add it to quotes from BP CEO Tony Hayward, where he's saying things like he wants his life back, when people in the UK hear these kind of things, are you just sort of shaking your heads and slapping your foreheads and saying, oh, God, you know, they blew it again?

Or are you still defending it? No, we don't defend that part of things. And we certainly sort of say for a company as big as BP, they really should have a good public relations department and brief these people before they go and open their mouths. And in the case of, as you mentioned, Karl Heinrich Svenberg, I mean, to actually refer to the people who've been affected by this as the little people just makes us cringe, just makes us. just feel really awful. I mean, we're all crouching down on our haunches now and going, no, no, don't say that. But I think in the whole case of BP, they just handled the whole thing very badly. If you have a disaster like that, you want to be seen to be doing something. And really, I would have just mobilized everybody in BP, go down to the shores, go down into where the

affected areas are, and let it be seen that you're trying to do something rather than to say, well, you know, we're capping. We understand, you know, that this disaster happened many miles down into the ocean. So therefore, nobody's going to see what's going on, how you're solving the problem. But I think it is very important to have this perception that you're doing something rather than to do nothing. You're listening to Motley Full Money. We're talking with David Quo from Full UK. David, I want to read you a couple of lines from a column in the Globe and Mail newspaper from Canada. And here's the quote, Americans think BP boss Tony Hayward is an English tough because he has an English accent. They don't realize he's a down.

ground earth geologists educated at schools that Cambridge and Oxford grads would sneer at. Would BP be much better off with an American spokesman dealing with the media? I think so, yes, and I think, you know, in situations like this, it is very important to have the right person out there. I know, yes, the chief executive has to be seen to be doing something, but certainly I think you need somebody alongside you who can explain better to the people there what's going on. But I'll tell you something else, Chris, and over here, people are scratching their heads and they're saying, why is BP the only company that is being vilified as a result of this? I mean, on this side, whether it's the BP themselves, whether it's their public relations department,

there's digging up all this information, but they're saying that there are two American companies that are just as culpable. One of them is TransOcean, the other is Halliburton. So why is all the pin being blamed on BP? And they're saying, surely, we should be sharing this responsibility rather than just saying there's one company. I know BP is probably, probably the biggest company there. It's the fourth or fifth biggest company in the oil sector. So therefore, it probably has to shoulder a lot of the responsibility. But to actually pin all the blame on just one company, strikes as being just a little unfair. Has there been any thought to what would happen if the roles were reversed? And instead,

it was off the coast of England. A U.S. oil company had this spill, and their CEO was, I don't know, a plain spoken guy from Texas. And he was saying that he just wanted his life back. Well, you see, I mean, that's the other thing. A lot of people, you know, refer to BP as being a British company. But they seem to forget that BP merged with Amoco. And so, therefore, it is an Anglo-American company. And it is just as American as it is British.

And people seem to be forgetting this, that this is a global company. I mean, it drills all around the world. And, of course, you know, this disaster happened in America. So therefore, you know, it feels as though it's going to be a lot worse than had it happened somewhere else. Much as I hate to say it, it just feels as though because it's happened very close to where you are, it is a disaster. Had it happened somewhere else, maybe not. You're listening to Motley Full Money. We're talking with David Quo from Full UK.

What was the reaction in the UK to BP's decision to suspend its dividend? Oh, the shares shot up about 7 or 8% as soon as it said that. And as you and I know, Chris, what the market hates most of all is uncertainty. In the case of BP, they just wanted a line to be drawn under this disaster. And I think BP has done that. BP has turned around and said, yes, it will accede to President Obama's wishes to have this fund of money, this pool of money, $20 billion. That is going to be put in place.

And for its shareholders, they will bear some of the pain. So they will not be getting dividends from now until the end of the year. So I think, you know, these two are sort of very good moves on the parts of BP itself. You're listening to Motley Full Money. We're talking to David Quo from Full UK. David, what's a bigger topic of conversation in London right now? Is it BP or is it the World Cup? Oh, it's what I'm watching on the screen right now.

Yes, it is the World Cup. It is Greece versus Nigeria at the moment. Yeah, that is the big topic. Yes, certainly the World Cup is a huge thing over here in Europe. And I'm sure over in America now because you now have a team in. America. What we couldn't understand was when England drew with America, why was it seen as a win on the part of the Americans? Because I'm sure some of the news must have drifted over to America. The headlines read, America wins one all against England. How did that ever happen?

David, it's just like investing. It's all about expectations. England is favored to advance to the next round. They're one of the favorites to win the World Cup. We're this tiny little country when it comes to soccer. And so we're huge underdogs. So the mere fact that we would draw with England, I mean, that's where the victory is. Oh, don't, don't come that with me. I mean, you've actually got a pretty good team over in the World Cup. And you, you together with England, are two of the teams that I believe will qualify from that particular group. I don't think you'll go much further than that, but I think, you know, you will qualify. Well, as we are taping this while the group C, which is what the U.S. and England are in, the various group matches are still going on.

But David, not only do you have a PhD in chemistry, in a previous professional life, you used to be a bookie. Is the World Cup like a month-long Christmas for bookies? Oh, yes, it is, because, I mean, people are betting not only on the eventual winners of the World Cup, but also on a game-by-game basis. You can do these spread bets at the moment, where you bet how many yellow cows are going to be issued in one game, whether or not a player is going to be red carded, in other words, sent off the pitch, how many goals are going to be scored? At what time will the goals be scored? Whether or not it will be a draw in the first half or a draw in the second half.

So there's this ongoing betting that's going on, and it is a huge industry. They reckon something like £1 billion will be bet on the World Cup here in Britain alone. Now, I was reading in the Telegraph online, England, despite Lewis, to America in that one-one match. England is still a 9-1 favorite to win the cup. As an investor, do you like those odds? Well, no, because I don't think England's going to win the World Cup. My tip for the tournament will be Germany,

because I've always had this saying that you never bet against the Germans, whatever they do. And in this particular case, I think the Germans look pretty strong. I mean, 4-0 win in the very first game looks pretty good to me. I guess unless you could, you know, go back in time and bet on World War II. World War II. But other than that... Yes, we don't mention that over here. All right, let's wrap things up with a round of buy-seller hold. And I'll start with buy-seller hold, the likelihood that BP will change the name of its U.S. operations.

Oh, bye, definitely. I think BP will have to change his name. It'll have to change his name to something really cuddly and fuzzy, I think, like lovely oil company. Or Arthur Anderson? Because that one's... That one's free now. Yes, it is. That's available. Yes, it is.

I think they're called Accenture now, aren't they? Exactly. Yes. Okay, so news out this week that Whole Foods is expanding to Scotland. So Buy-Seller Hold the future of Whole Foods in the UK. Oh, definitely buy. Yes, I think people over here are really into organic produce. And even though they're going into Scotland, you know, which is a great organic territory,

I think they will do very well. Because people are basically very lazy. They don't really want to go and dig up their own vegetables. much nice to go into a supermarket and buy it off the shelf. Is the price point going to be a barrier at all for Whole Foods? No, absolutely irrelevant. I think, you know, people that buy any old rubbish that comes out of an organic food store. I mean, have you seen some of the stuff that comes out of the ground these days? Carats are meant to look like carrots, right? In other words, they're kind of gnarled

and warped and everything, but these carrots, you know, they come out, you know. They're lovely. Exactly, yeah, people pay anything. As long as they say, they're meant to look like carrots. say organic on them. We've got ongoing problems in Greece and some of the other EU countries, including the fact that Belgium's new majority party in Parliament favors splitting Belgium into two separate countries. So buy-seller hold the future of the euro. Oh, good grief.

That really is a tough one. Sell, because I think the euro is going to possibly find it very, very difficult. There are any factions within Europe itself. There are countries. You know, over in Greece, they probably wish they had never joined the Euro in the first place because the Greeks would love to bring back the old drachma and say, let's devalue this. And I think Spain would love to do it with the, with the Peseta as well, just devalue them, because it would give them a much better opportunity to get out of this mess. A lot of buzz that they might soon be engaged by Sellerhold, Prince William and his girlfriend,

Kate Middleton, getting married in the next year. Oh, definitely a buy. I mean, the newspapers are full of these two people being so close together now. I think I would not only buy the fact that they're going to be married. I think I will invest in some kind of pottery company because as soon as these people get married, all these plates will start coming out and people will be filling their shelves and their kitchens with mugs, plates, any old thing, you know, just to commemorate their wedding. So there's an investing opportunity? I think so, yes. And I tell you what else there is an investing opportunity in?

And these are the Vuvuselas. Have you heard them? Those are the horns that are at the World Cup that when everyone blows them at once, it sounds like millions of bees have descended upon the match. That's right. And I think it's going to be the next big thing over here in the UK. Sainsbury's, which is our third biggest supermarket over here, ordered 75,000 Vuvuzailas, and they've already sold 50,000. They only have 20,000 left, and they reckon they'll clear those by the end of the week.

So Vuvuzailers are the future. And finally, he is beloved in the United States and all around the world. and let's face it, BP could use a fresh face on the communications front. Buy seller hold, BP hiring Sir Paul McCartney. Oh, definitely a buy. I think Paul McCartney and wings as well. I think you need to bring both of them into the mixture. And I think Paul McCartney at the helm of BP would certainly be a buy.

Ringo? Is there a job for Ringo anywhere? Yeah, he can be chairman. He can sit there with his set of drums and he can be chairman. I think the two of them would be great. David Quo is the host of Money Talk. If you are looking for insight on the British economy and investing in the UK, there is no better source. You can get Money Talk on iTunes and you can listen online at the Motley Fool UK's website,

which is just www.foolukuk.com. David Quo, thank you so much for being here. Thank you very much, Chris. Coming up, some fatherly advice and the stocks that are on our radar. Stay right here. You're listening to Motley Fool Money. As always, people on the program may have interest in the stocks they talk about. Don't buy ourselves stocks based solely on what you hear. Welcome back to Motley Fool Money.

I'm Chris Hill, and back in the studio with me, our trio of senior analysts, Seth Jason, James Early, and Shannon Zerrin. Guys, before we get to stocks on our radar, it is Father's Day weekend. We're all fathers, and just wanted to go around the table. Whether it's your own dad, your father-in-law, a grandfather, a father, figure, or coach, What's the best advice you ever got? And it can be about money, it could be about anything. Shannon Zimmerman, I'll start with you.

Well, my father-in-law, a long time ago, not coincidentally when I first married his daughter, encouraged me to pay myself first. And I wasn't really sure what he meant by that. But essentially, it was just as you get raises, save more or invest more. My father, who was a paratrooper, encouraged me not to jump out of airplanes. It's apparently heck on the knees. Yeah, that's always good advice, no matter when that's coming. Why would you jump out of a perfectly good airplane?

Well, this was a, you know, he's a veteran. James Early? You know, Chris, my dad told me to never become a lawn freak, and that helped me to prioritize a little bit of my life, so I'm thankful for that advice, actually. A lawn freak. A lawn freak. A lawn freak.

A lot of people always fertilizing their lawn, always mowing. One guy used to mow it diagonally one way and then diagonally another way to get the crisscross look, you know? That looks good on baseball diamonds, but I don't think I want that on my front lawn. Seth, Jason, best advice? Oh, boy, it was probably something like, get the hell out there and mow the lawn. And I'll give you it'll give you 10 bucks or whatever the going rate was back then. My parents were, my father and my mother both were good about sort of making sure we didn't, you know, have zero dollars.

But we had to get out there and work if we wanted anything extra. You know, with my dad, the most memorable piece of financial advice I ever got had to do with the whole notion of being cheap and just sort of teaching me about like, look, it's one thing to be thrifty. Don't ever be cheap. There is no upside to that. Steve Broido, what about you? I think it probably is advice that came from his stockbroker at the time who said the first bit of bad news is usually not the last bit of bad news. Oh, that's kind of Zen. We were talking about BP a few weeks ago, and it would be a good time to invest in it. All right, guys, let's get to the stocks that are on our radar for this week.

Shannon Zimmerman, we'll start with you. I am going to go back to the well to talk a little bit about Sprint, which I think I first mentioned on the show almost a year ago, close to, and I have to say, I was right. It was pretty badly. Wow, it only took you a year to be right. Well, and I wrote about it on Fool.com, too, and took a lot of heat in the comment section, because immediately after I started talking about it, it tanked. But it's up about 23% over the last year, which outpaces the S&P over that period,

and still looks very cheap to me. I think that anybody who wants to look into the telecom space and is maybe concerned that the AT&Ts and the Verizon or the apples of the world or maybe a little priserer than they ought to be. Give Sprint a look, ticker is S, and they're going to play to a down market in a way that those former concerns will not. Okay. James Early? Chris, I'm looking at American Eagle Outfitters. This is a company that I like. I don't like them just yet because I'd like the price a little bit cheaper, but it is actually

a dividend stock. 3.3% yield. They just raised their dividend 10%. 6.7% insider ownership, which is really good for a company like this. The returns, the Operational returns have fallen in recent years, obviously. But as things pick back up, if they do, and if the price drops, I like it. What's the ticker symbol? AEO. Seth Jason. Everyone should go out and buy a lot of that stock at any price, really, from me.

I was going to say, are you a shareholder? From me they could buy. I'm going to go with Logitech, which most of our listeners will be familiar with this company if they've ever been in a best buy or anywhere else. This are the folks that make the mice and the keyboards and all sorts of other peripherals. doing a lot with remote controls that kind of put all of your devices on one remote. Price has come back to around $15 a share recently, but this is a company that makes a lot of free cash flow during good times, and they did also during the bad times.

And they were killed along with everybody else in this sector, but they are making pretty good progress on holding their margins and on getting back on track, and the stock price really hasn't reflected what I think is the potential. So the ticker as L-O-G-I, and that's a good one for dad. All right, Seth Jason, James Early, Shannon's everyone. Guys, thanks for being here. Hey well, Chris. Thanks also to our special guest this week. David Quo from Motley Fool, UK. He hosts Money Talk, a weekly podcast available on iTunes, so check it out. That's Money Talk with David Quo. If you missed any part of the show, you can get 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.