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To Splurge or Not to Splurge; Getting the Most Burn For Your Buck

Aired December 26, 2004 - 15:00   ET


ANNOUNCER: From New York City, America's financial capital. This is IN THE MONEY.


JACK CAFFERTY, HOST: Welcome to this special holiday weekend edition of IN THE MONEY. I'm Jack Cafferty. Coming up on today's program:

To splurge or not to splurge: We'll do our best to figure out whether 2005 will leave your wallet looking overstuffed or anemic.

Plus, the silent (SIC) song of the shopping mall: Find out how one of the biggest ideas in retail changed American business and American life.

And fitness at any price: From a few dollars to a few thousand, there's a way to take off those holiday pounds. See how to get the most burn for your buck.

Joining me today a couple of IN THE MONEY veterans, "Lou Dobbs" correspondent, Christine Romans; "Fortune" magazine editor-at-large, Andy Serwer.

As the curtain comes down on another year, memories that kind of stand out, my favorite is that insipid election is finally over and we don't have to face another political campaign on a national basis for another four years and I am very grateful for that.

ANDY SERWER, "FORTUNE" MAGAZINE: And the debates, too, Jack.

CAFFERTY: It was awful.

SERWER: You don't have to listen to any more debates.

CAFFERTY: What do you think about when you think of the last year?

SERWER: Well, you know, I think that one thing that comes to mind, Jack, is the underling of institutions in this country, and this is kind of a big think idea. But if you think about investigations and questions about the FDA, about the Securities and Exchange Commission, about major league baseball, about the Catholic Church, there are a lot of investigations and questions underling these institutions that we have counted on for generations, and I think that's a very important trend.

CHRISTINE ROMANS, "LOU DOBBS" CORRESPONDENT: Right. And I just did a story this week about -- you know, the safety of this country, the security of our borders, the fact that people with stolen pass ports can still get into this country, can still fly in even if the government's on the lookout for a stolen passport, you can get through. I think that even in the years after September 11, we're still -- we're still grappling with pretty big issues about what's going on here and how things are going to change in terms of intelligence, security, safety of this country.

CAFFERTY: Yeah, it's in a way kind of pathetic we haven't made any more progress in the three years since September 11 than we have. And isn't it ironic, when you talk about the institutions that are coming unraveled in this country and you look at the last election when the president was reelected, supposedly elected by voters who are concerned about values, at the same time lot of these institutions don't seem to have many any more.

SERWER: Right. But, I think one thing when we look back at this year and this era, it would be overwhelmingly we will think of the war on terror in Iraq.

ROMANS: Right.


SERWER: I mean that is really the big story of our time, right now, and it sort of overshadows everything else.

CAFFERTY: All right. You heard plenty this month about giving and receiving. So, we're going to skip all that for a few minutes, jump forward to the New Year, we'll find out whether it looks set to leave your wallet fatter or skinnier than it is today. We don't have any crystal balls around here, but we do have "Fortune" magazine senior writer, David Rynecki, who rounded up some expert opinions recently on what's ahead for your money in 2005.

David, good to see you, thanks for being with us.

DAVID RYNECKI, "FORTUNE" MAGAZINE: Hey, thanks for having me.

CAFFERTY: Market's up what, eight or nine percent on the year which is a little better, quite frankly, than a lot of people expected it might do. We are looking at GDP that last Friday was revised up to four percent, that's pretty healthy growth. The fed doesn't seem intent on jacking interest rates up to where they're going to put the brakes on this economy. Inflation appears contained. So, what's the outlook for the market in 2005? Is it a good place to put our money?

RYNECKI: Those are great numbers you're talking about, and you're right, going into this year, nine percent, people would be happy. I think right now people are way too bullish. What we recently had a roundtable, brought in about five really great investors, veteran market people, and the theme they brought out was this idea that we haven't quite felt enough pain, you know, we had this huge bear market everyone remembers, but then we boom! Right back in the game, and everyone's thinking, let's buy Google. Look at Google, it's a great example, and you know, these tech stocks taking off. People have sort of forgotten the lessons of the last few years. And I think that we're going to be reminded of that next year, because right now, as we said, things are great, but look out to the middle of next year, the fed is going to continue raising interest rates. Ultimately that's going to affect the bond market. The president has some big plans for Social Security. There are some concerns about how that would affect our debt situation, and just a number of issues. Iraq is going to weigh on us. There are a lot of reasons not to be too bullish right now, and yet, UBS, the big investment firm just came out with a survey that said that the average investor, they surveyed, the average expects the market to gain about 12 percent over the next 12 months. I think that just shows you how exuberant they've gotten.

ROMANS: So, this is a stock picker's market not a stock market, this is a market of stocks, meaning you got to find what to buy, if what you say is true. So what are these experts, your panel of experts telling about what kinds of stocks people should buy next year, if all this is true?

RYNECKI: Well personally, I think might be a market of savings accounts if people are really smart, because if you look, and I think we're all on the same savings plan, the same 401-K. Look at the cash management account, and that's up something like four percent for the year and that might be one of your best performing assets, certainly Time Warner stock is.


SERWER: We noticed.

RYNECKI: Yeah, when you talk to these experts, what they come back to again and again is the idea of dividends. As many of the viewers know, the government has become much more generous how it taxes dividends and that has unleashed the generosity of corporate Americans, sort of giving us back some of the profits. So if you look at some of the big companies, the Chevrons, look at 3M, these companies that consistently put out increases in their dividends, other companies, Altria is a good one, maker of Oreo cookie and a couple of...

CAFFERTY: Cigarettes.

RYNECKI: Yeah, cigarettes, we want to maybe avoid that subject, but you know what? Cigarettes make money and so do Oreo cookies and if my kids, next year, just eat the same number of Oreos they did this year, then that's good dividends for investors.

SERWER: Hey Dave, you know, this has been a tumultuous year for the markets, but in final analysis it's going to basically be a historical return, very close to it seven, eight, nine percent, sound and fury signifying nothing, I guess. Let me ask you though, you know, you sound a little cautious, a little bearish. What could go right for the market? What are the good things? What are the good signs out there? Give me a little rose-colored glasses, Dave, come on.

RYNECKI: Oh, come one, I got to give you rose -- all right, the so what could go -- well, first of all, well the economy can continue to do well. Now the -- historically business cycles lasts about three, three and a half years, so if that would stay, we'll probably have a recession sometime the middle of next year. That doesn't have to happen, interest rates are still very low. We're still -- you know, the economy is still growing. There are -- you know, unemployment, people have talked a lot about unemployment being a problem. It really isn't, it's very low. Also, if we can get a decline, a sort of consistently lower oil, if you're going to pay less money at the pump, that's going to put more money in the pocket and help consumer spending. Right now, that is a big question mark, and if we can settle -- I can't imagine that Iraq's going to be worse a year from now than it is today, even though all the naysayer say that's not the case. But, that lower oil price is going to help us out and -- you know, mild winter, the winter is actually -- you know, going pretty smoothly.

SERWER: Uh oh, counting on the weather, Jack.

RYNECKI: Depending on the weather.

SERWER: That's always tough...


RYNECKI: I'm fishing. I'm looking around for some good things. But, you know what? You know what? Here's the best thing for investors. If I, a journalist, feel pessimistic, therefore, they should feel optimistic.

SERWER: Right.

CAFFERTY: No, the stock market, too is a forward-looking mechanism. The stock market, right now, is having itself a big-time Christmas party. It's happy about what it apparently sees down the road.

RYNECKI: Yeah. Yeah.

CAFFERTY: That might be enough positive impetus for investors to take a second look at putting some money into the market.

RYNECKI: Yeah, but there are a lot of issues. Like if you look at the PE on the market is something around 20 times the trailing profits, things like that. There are a lot of reasons to be cautious, but when you look in it, as Christine said, that of a market of stocks, you look at these dividend companies, some of the small caps, things like that, they are very attractive. I know there are a number of companies, for example, in the home building area, that even though that market has taken off there's low PEs in there, and in home builders, the market has discounted a huge crash in the housing market, I don't see that happening.

ROMANS: Although some would argue that homebuilder PEs are traditionally lower than the rest of the market and so...

RYNECKI: That's true.

ROMANS: A single digit PE at nine or 10 or 11 is actually kind of fair for some of those, but I mean, we can argue about that.

RYNECKI: Look at the way a lot of the companies have been -- you know, whacked this year. Then you get the -- if you're going to make two, three percent on a dividend, that's fantastic, then you add -- you know, five, 10 percent of capital gains, that's a heck of a nice return.

ROMANS: David, let me ask, are you -- I mean, are you surprised that the Dow is at a three and a half year high? I mean, just the other day the S&P suddenly closed at the highest since before September 11, 2001, and I thought, are we back to where we were before 2001? I just -- I think that's interesting.

RYNECKI: Yeah, I'm not surprised, and in a way it reminds me of just how pathetic the last few years have been, because I remember sitting in a hotel room in California, I guess it was in 1999, and the Dow crossed 10,000. Everyone had their hats on.

ROMANS: Right.

RYNECKI: You know, so it just shows me how little we've gained in those years, but at the same time, you know, we've survived. I think that's one of the major things and Andy talks about being optimistic and I think he's very right about that. That we are here, we've fought a couple of wars, we've had to deal with terrorism and we're still here and everything's functioning and it's -- it is possible to say the sky is falling, but also you look and say, well, -- you know, we've actually managed ourselves pretty well.

CAFFERTY: The other thing, I suppose, if you look around the landscape and look at the stock market versus other investment vehicles there's not a lot out there to entice investment dollars, like you say, money market accounts, if interest rates tick up a little bit. The bond market is not looking forward to a good year.

RYNECKI: Yeah, I wouldn't go anywhere near the bond market right now.


RYNECKI: We talked to bond people and they're not going near the bond market.

CAFFERTY: No. The real estate market, a lot of people say, has matured to the point where it's going to start going the other way. So, at the end of the day, if you have a few bucks in your pocket it may be the lesser of all evils out there, and you give Wall Street a tumble.

RYNECKI: The only thing is just be smart about it. And, like I said, the dividends are important, you know, you just -- it's so simple to say this, but so many people don't remember it, that if you want to buy low, sell high. And it comes down to this, the higher the PE, the less return you can expect over time. So, if you just went out and bought everything that was a 10 PE and put it into a big pool, you'd probably do pretty well over time.

CAFFERTY: Sure, all right. David, we got to leave it there. It's a pleasure to have you on the program. Thank you.

RYNECKI: Thanks a lot.

CAFFERTY: David Rynecki, senior writer for "Fortune" magazine. When we come back, it's a mall-mall world. Something keeps Americans hooked on the shopping mall and it isn't the stuff their serving in the food court, either. We'll look at what's behind the attraction and how it's changed our lives.

Also ahead, sugar and schlock: Any old studio can make a crummy Christmas movie, they prove it every year, but it's a lot tougher to make a keeper. Film critic Leonard Maltin joins to us talk about what separates a classic from a dud.

And find out what happens when one of those holiday classics gets an up date. Forget the reindeer, think rabbits.


CAFFERTY: It's the biggest thing to happen to gift giving since wrapping paper. But just like the roll of Santa meets the surveys that you've been using since the '80s, the shopping mall is looking a little dated these days, and despite the crowd you, no doubt, had to fight the last few weeks, the mall's heyday is passed, at least according to our next guest.

Joining us is Paco Underhill author of the "Call of the Mall," he is also the founder of a CEO of the consulting firm, Envirosell.

Welcome, nice to have you with us.


CAFFERTY: So, what has led to the demise of the shopping mall and what are we going to do for a life if we can't go to the mall anymore?

UNDERHILL: Well, let's make it clear, the mall is part of our landscape for the foreseeable future, but from the standpoint of our social order and financial order, it is no longer the slam-dunk that it used to be.

ROMANS: Now you've got these big series of humongous big box stores, the Borders next to the Bed, Bath and Beyond, next to the Home Depot, really sucking away some of the sales for the malls, isn't it?

UNDERHILL: Part of what is interesting is the social stratification of retail is over. The same woman that shops at Macy's or at Bergdorf or at Neiman Marcus, is shopping Bed, Bath and Beyond on the same day.

SERWER: Why don't we talk a little bit about the success of the mall and how it changed our lives and impacted our lives? I mean, it really has become and still is, I think, our new town's square, isn't it? I mean, people go in there, there's the early morning walkers, there's entertainment, people get drunk in malls.

ROMANS: Santa.

SERWER: They hang out, they go on dates there. Talk about that.

UNDERHILL: OK, let's -- you know, recognize that retail follows housing, and that in the '70s, Americans made the migration from the urban core out to the suburban open landscape. Baby Boomer mothers were desperately lonely, and the place that they went to was the shopping mall. Most shopping malls across the U.S. are more than 25 years old, and they track that movement in basically 1975.

CAFFERTY: What about the combined phenomena of the Internet, and these TV shopping networks? I mean, I can either go on my computer or turn on my television set, see something I like, pick up the phone. I don't have to put on a coat, a glove, a hat, don't have to go near the car, don't have to find a parking place, don't have to fight a bunch of snotty nosed little kids running up and down the aisles of every store. You know, it's as -- and the thing is at my door two days later and it's -- and I put it on my credit card. I mean, that can't be helping the malls.

UNDERHILL: Sounds like you are over 40.

CAFFERTY: I am so far over 40, you have no idea. I remember the dawn of the internal combustion engine.

SERWER: He's 41. He's 41 years old.

UNDERHILL: Let's just -- let me address that question two ways. First is one of the Seminole needs of human beings is to look at other people, and that one of the ways that historically we have done it is at the shopping mall. In terms of the acquisition of goods here, most of us, who are over age 40, could live the rest of our lives on fruit, vegetable, pasta, wine, olive oil, and yearly doses of socks and underwear. Particularly those of us who are over age 40 remember shopping as a downtown experience. We relate to the shopping mall very differently than somebody who's 20 years old.

ROMANS: It's interesting, because I think that a lot of people, I guess it's a sign of how affluent our society is, how great it is to be an American and live in this country, that we can have our entire social structure dependent on spending money that seems to be in plentiful supply.

UNDERHILL: Well, mazoltoff, for you there. All right, one of the things to recognize, though, is that the major innovations in shopping malls are now happening offshore. It's really poignant that here in New York City, at the Time Warner Center, we are finally getting a supermarket in an urban shopping mall, where it's existed in Sydney, in Barcelona, in Madrid, in Paris, for decades.

SERWER: What about these -- I was going to ask you about the overseas mall. You said the future is overseas. What makes these malls so great in Lisbon and places like that? I mean, so they got a supermarket in it? I mean...

UNDERHILL: Well, some of it is because they are developed with a better partnership of public and private money. If you look across the U.S. at all of our shopping malls that were built 25 years ago, how many of them will win landmark status?

ROMANS: Oh yeah, they're not very pretty. None of these are very pretty.

UNDERHILL: And they are boxes with mouse holes in them. The Vasco Degama Center in Lisbon is gorgeous. It's got great glass, it looks like a futuristic ship. The new shopping malls in South America, they have a laundromat at the doorway, so singles can drop off their laundry, go shopping, and 90 minutes later, it's washed, dried, and ironed for them. Wouldn't that be nice?

SERWER: That would be nice. That would be nice. Well, maybe coming to a mall soon near you, I hope, right?

UNDERHILL: We hope so.

SERWER: We hope so. All right, well, happy shopping. That's Paco Underhill, who is the founder and CEO of Envirosell and author of the "Call of the Mall." Thanks for coming on.

UNDERHILL: Thank you, guys.

SERWER: Coming up after the break, there's gold in them there arches: Find out what made McDonald's one of the year's most watchable stocks.

Also ahead, how to get in shape without straining your wallet: See which fitness methods pay off best dollar for dollar.

And, putting the ever in evergreen: Allen Wastler reflects on the pros and cons of the fake Christmas tree.


ROMANS: Now let's take a look at the week's top stories in our "Money Minute." It hasn't been such a merry Christmas for retailers. Shopper Track says retail sales, the Saturday before Christmas, were down seven percent compared with the same Saturday last year. But online sales continue to surge, and since more and more sales happen in the week after Christmas, stores may make up for it with a strong January.

Another week, another FDA warning about a pain killer, this time for the over-the-counter product known as Aleve. The FDA says the pill's active ingredient, naproxen may increase the risk of heart attack and stroke. Shares of Aleve manufacturer, Bayer, dropped worldwide on that news.

And, if you tell your boss you're a nonsmoker, you better be ready to prove it. More companies are looking to cut down on healthcare costs, by only hiring nonsmokers, or making their smoking employees pay a special added healthcare fee of $50 a month. To keep everyone honest, some companies are requiring job applicants to undergo nicotine testing.

SERWER: All right, you may be surprised to learn that of all the stocks in the Dow 30, McDonald's is actually the top performer for 2004. The fast food chain was in the news mostly for the wrong reasons this year, but its shares are up more than 30 percent from where they were at the start of 2004. And now, several brokerage firms, like Bank of America, are raising their price targets for McDonald's shares in the coming year. So, I guess the average Big Mac eater doesn't give a darn about the restaurant CEO's health.

McDonald's is our "Stock of the Week." And what that refers to, of course, is this string of CEOs. You had this guy named Greenburg who resigned, then this guy Cantalupo comes in, tragically dies. Charlie Bell comes up from Australia. He runs the thing, he has health problems, he has to leave, and now this new Skinner guy in there. It's ironic, it's sad that CEOs of a fast food chain have health problems, but there's a lot of turmoil.

ROMANS: There's been a lot of new things over the last year and a half, so as all of these health problems have been happening so have the turnaround in sales for this company. The question is, can you get a CEO in there long enough and can you keep them in there...

SERWER: Healthy enough.

ROMANS: Right, and can you keep the sales turnaround going.

CAFFERTY: Well, if the business model is working, and it is, and the stock is up 30 percent, why does the incoming CEO have to do anything, except change the heading on the stationary? I mean, they got it firing on all cylinders. If it's not broken, don't fix it.

SERWER: Well, you know, a couple of years ago, Jack, they were kind of weathering a perfect storm of problems, because you had anti- Americanism on the rise, mad cow, and plus they were not executing, since then -- and the stock was in the low teens.

ROMANS: Right.

CAFFERTY: Oh, I remember.

SERWER: It's basically doubled off that two years ago. Since then they've done a lot of things in their stores right, including featuring chicken and salads. So, you got to tinker with the model a little bit. You know, this is a very profitable company, makes $2 billion a year. So, you're right, it is sort of on automatic pilot to an extent.

ROMANS: We'll have to watch to see if the fruit and salad -- fruit and walnut salads or fruit and nut salads that they're going to come out with is going to work. You know? I mean their salads...

CAFFERTY: California will buy it. Right? The bulk of their sales is still hamburgers and fries. I mean, they've tinkered with the menu and they've added all these other things to appease the political correctness in this society, but they still sell Big Macs and fries.

SERWER: Right.

ROMANS: On the floor of the New York Stock Exchange when you buy or sell a share of McDonald's, you say -- you know, "I want to sell 100 hamburgers. I want to buy 10,000 hamburgers."


ROMANS: I mean it's the name -- it's the name of the stock.

SERWER: The one thing that's interesting is Burger King, which is obviously their archrival, and decided No. 2 however, but for the first time this company's actually owned by Americans. I mean it's been owned by the Brits for years and frankly, they can't run a U.S. hamburger joint.

CAFFERTY: I don't -- I like Burger King.

SERWER: Well, I do too, but it's going to get better, is my point. And actually, their fries aren't -- McDonald's has the better fries...

CAFFERTY: They do.

SERWER: And come people say Burger King has the better burgers. I happen to believe that.

CAFFERTY: They have better fries because they didn't keep their word about taking those transfatty acids out of the grease they cook the fries in.

ROMANS: That's right.

CAFFERTY: It's still in there, I think. But, you're right, they're the best fries in the world. They're terrible for you, but they're good.

ROMANS: But that's what you go for French -- when you go for fast food you know you're getting the bad stuff. That's what's so good about it.

SERWER: Moderation, only eat there three or four times a day.

All right, coming up on IN THE MONEY, skip the weights, see how lifting your wallet can shake off the effects of that holiday binge.

Also ahead, ghosts of Christmas past: Leonard Maltin will take us through some classic holiday films and see how this year's offerings, like "Polar Express" measure up. And a holiday movie tradition with an online spin. "It's a Wonderful Life" gets a little furrier and a little shorter on our "Fun Site of the Week."


TONY HARRIS, CNN ANCHOR, IN THE MONEY: I'm Tony Harris at the CNN Center in Atlanta. IN THE MONEY continues in a moment. Bit first stories now in the news.

Opposition leader Viktor Yushchenko may become the next president of the Ukraine. Three exit polls in today's repeat election have given him a double-digit lead over Prime Minister Viktor Yanukovych. Final results are not expected until tonight in Kiev's Independence Square, the Yushchenko camp is already claiming victory, hundreds of his supporters wearing orange, cheered and waved flags in celebration.

Unbelievable devastation in Southeast Asia an 8.9 magnitude earthquake struck off the coast of Indonesia, Sumatra Island, it has caused deadly tsunamis across the region. More than 10,000 people are dead mostly in Indonesia, India and Sri Lanka. Thousands are missing and hundreds of thousands are homeless. The quake was the fifth largest in recorded history.

Football fans are mourning the loss of the minister of defense, Reggie White, who played for the Philadelphia Eagles, Green Bay Packers and Carolina Panthers, died this morning. The cause of death is not known at this time. White is known as one the greatest NFL players at the time he was 43.

A complete check of the day's top stories at the top of the hour on "CNN Live Sunday." IN THE MONEY continues right now.

CHRISTINE ROMANS, CNN ANCHOR, IN THE MONEY: Are those brand new Christmas clothes feeling a bit snug? Don't blame mom. She actually got your size right this year. In fact, you've put on a few pounds this holiday season, and you know who you are, but not to worry. You got plenty of company. In fact, nearly half of the population say they gain weight during the holidays. So how you keep your waistline in shape without denting your bottom line. Joining us with some tips is Betsy Stephens, she is a fitness editor at "Fitness" magazine, she joins us now with some different ideas for different budgets. Betsy thanks for joining us.


ROMANS: You know this happens every year. You hear people, your friends, your family say I'm not going to gain that Christmas five this year and then come January, you're mad because you did. Your best advice to avoid a repeat and to keep those five pounds off?

STEPHENS: Well, the best thing to do is keep exercising through the holidays, and try to keep control of the calories that you're consuming during the holidays, and instead of planning parties that are involving food, or get-togethers that involve food, you could maybe plan a shopping trip with a good friend who you want to catch up with or maybe plan a trip to the movies, and then if you do go to holiday parties, which we all do during the holidays, you should eat beforehand so you're not starving when you get there, and then you should try to limit the trips that you make to the cocktail table or to the food table, so you can maybe make a deal with yourself that you will talk to three different people before you return to the table. That can kind of --

JACK CAFFERTY, CNN ANCHOR, IN THE MONEY: Depending on who they are, that could mean the you are back in the table in 30 seconds.

STEPHENS: Well that's true.

CAFFERTY: Betsy, let me ask you a philosophical question. I know you'll talk about ways that you can lose weight and do it so that it doesn't bankrupt you. What is it in the human psyche that makes us all feel like we have to be spending money in order to be fit? I mean if you eat a proper diet, do some sit-ups and push ups and go out and run a little bit everyday, you'll be fine it doesn't cost anything.

STEPHENS: That's true, but I think that we as humans get bored easily. And if that's all you could do every day then you'd get tired of it after awhile. So I do think that we do feel like we need to go out and spend on a gym or spend on a personal trainer who can motivate us and who can give us some different ways of getting the same job done, basically.

ANDY SERWER, CNN ANCHOR, IN THE MONEY: All right, Betsy, I'm not sure whether or not you can see me but I'm actually not this fat. The camera makes you put on 20 pounds.

CAFFERTY: Yes, he is.

SERWER: It's not the pigs in the blanket. Why don't you talk a little bit about some of your best bets in terms of losing weight and fitness and that sort of thing.

STEPHENS: Well, as far as -- you mean as far as what you --

SERWER: What you can spend some ideas that you have.

STEPHENS: OK, I mean if you're looking to spend the least amount, there's a new product out called Fit Jump and it is basically a jump rope that you can make a weighted jump rope and it comes with a video that you can, that will show you all of these different ways to jump rope. It's kind of like a workout tape and you do it along with them. It's great. You can burn up to 400 calories in a half hour.

ROMANS: That's 25 bucks, right?

STEPHENS: Yes that it is.

ROMANS: And for $50, you can get the stability ball with resistance bands.

SERWER: Oh the stability ball, Jack, it's for you. I'd like to see Jack on the stability ball. I do. I want to see him on one.

CAFFERTY: All right, that's enough.

SERWER: Do you stand on them, Jack, do you balance?

CAFFERTY: I apologize Betsy for Andy. It's a contractual thing, we have to put him on every week.

SERWER: It is true.

STEPHENS: Well, if you are concerned about space with the stability ball, you can deflate it.

ROMANS: You also have a video game, Mya, the Personal Trainer. This can be yoga, this palates, all kinds of different things.

SERWER: What is her name?

STEPHENS: Mya is her name and it's incredible. You can use it on an X-box or on a PC and basically you input the information that you have, or the equipment that you have. You tell her you have a stability ball, a yoga mat, dumbbells. And she will --

SERWER: You can tell her?

STEPHENS: Yes on the PC.

CAFFERTY: Then she devises a workout for you based on the equipment you have available.

SERWER: She's not real, Betsy, is she real?

STEPHENS: She looks real.

ROMANS: I guess the idea if you can't do it yourself, you have to have some trick or tool to make you do it.

STEPHENS: Yes some way to motivate yourself.

ROMANS: But the bottom line is if you don't want to spend anything, how many calories go in is, and how many calories you burn is the ultimate formula, and I guess on our own, we just can't seem to get that exactly right.

STEPHENS: Yes, I mean it sounds like a simple formula, but it is hard to follow.

CAFFERTY: What about gimmicks, things that people ought to be careful about? Sometimes late at night on a weekend, you put on the TV and they got all of these order a bottle of this and take them for 90 days and you'll lose 40 pounds and you look like Charles Atlas. I mean there's a lot of that stuff out there. How do you know what's real and what's not?

STEPHENS: Well the bottom line if it sounds too good to be true, it is too good to be true. I think awhile ago they were talking about things that you could put electrodes on your muscles and it would actually exercise the muscles for you, and as it turns out, it might stimulate some of the superficial muscle but it was not getting deep enough to actually give you ripped abs, which I think is what they were advertising.


ROMANS: Funny, if it sounds too good to be true, it probably is.


SERWER: Especially with the superficial muscles.

ROMANS: Yes, Betsy Stephens, "Fitness" magazine, thank you so much for joining us today. Everybody try to keep the five pounds out. Don't do it!

There's much more to come on IN THE MONEY. Up next, a flash in the pan or here for the long haul? "Christmas with the Kranks," it's just one of 2004's holiday releases. Leonard Maltin looks at the holiday movie and tells us how to spot a classic.

And just add water, but then again maybe not. Allen Wastler has some thoughts on the kind of Christmas tree you don't find in the forest.


SERWER: If you're looking for a heart-warming Christmas movie this year, you'll have a tough time finding one. The days of sentimental drama like "It's a Wonderful Life" or "Miracle on 34th Street" are long gone. These days, Hollywood prefers off beat comedies that poke fun at Christmas and are less than perfect family get- togethers like this year's "Christmas with the Kranks." So are films like these changing Hollywood movie going? Leonard Maltin joins us to talk more about this, he is the hot ticket movie critic for "Entertainment Tonight." Leonard welcome.


SERWER: So what's really going on with these movies, these Christmas movies? Are we seeing a change in the way they're being made and what's being put out there?

MALTIN: I think the people who are making Christmas-themed movies today feel, they believe that people are more cynical about Christmas and that there's more of an edge and everyone in Hollywood loves edgy things, it's an edgier thing to make a comedy, in particular, about people who either don't like Christmas, are annoyed by Christmas, find it a nuisance, but then at the end of the film inevitably, they turn sentimental because they want to have it both ways, they want to show that after all, family is what Christmas is about and getting together and all of those things that we associate with the holiday.

So "Christmas with the Kranks" and "Surviving Christmas," two of them this year, both tried to do that and they both failed, incidentally. I think that they're misreading the audience out there. Where as "The Polar Express" which was drubbed by most of the critics, really savaged in many cases is very successful.

ROMANS: Well I guess you can argue we already have the Christmas classics, though you know "Miracle on 34th Street," White Christmas" and you can watch them year after year as a family event. Maybe they're not a reflection of the cynical American viewing public, but maybe we already have the perfect Christmas movies and we don't need anymore.

MALTIN: Well we do but when Tim Allen made "The Santa Clause," I thought that was a delightful film and it did what few others managed to do, it took a modern sensibility, a very contemporary film but it layered onto it a kind of sentiment, and a kind of belief that we rarely see in Hollywood films now. It's sincere. It's genuine. It's about a guy who is a hustler and is too busy for his family, but then does learn the real meaning of life and what values he should be embracing, and they managed to pull it off in the sequel as well, which is rarer, "The Santa Clause 2." Bred Rankor, the director, sort of a reshaping of "It's a Wonderful Life" called "The Family Man" with Nicholas Cage and Tea Leoni. And I thought that succeeded, too. I think people in Hollywood are afraid of sentiment because they think audiences will reject it when in truth I think audiences are looking for something emotional to connect to.

CAFFERTY: To what degree is television a factor in this? And by that I mean Leonard that you know some of the movies that Christine was talking about, these were made before television became wall-to- wall Christmas programming for the months of November and December. Kids and families would go to the theaters to see "White Christmas" or something. Now the television shows that are aimed at the kids and the Christmas specials number in I guess the hundreds, so in order to entice people out to a Christmas movie, doesn't it have to offer something besides the kind of vanilla fare that is associated with a traditional Christmas programming on TV?

MALTIN: Well that's the belief, Jack. That's the premise on which some of these films are made, but the failure of the recent ones that tried to take an edgier or, you know, smart alec view of Christmas, says that audiences didn't want that. "The Polar Express" based on a beloved children's book, succeeded with audiences. So you draw your own conclusions from that. However, you're quite right about television changing the landscape. Because television is what made "It's a Wonderful Life" the classic it is today. Television is what's increased the audience for the wonderful 1983 film "A Christmas Story" based on Jean Shepherd's memoirs. They did a 24-hour "A Christmas Story" marathon last year. People have come to love that movie, who have not seen it in the theater. SERWER: So Leonard first I want to take issue with some of what Christine said that they are not making family Christmas movies anymore. I mean you can gather your kids to watch "Bad Santa." That's a tough piece of work. But listen are these Hollywood movies, these Christmas movies, there are too many of them, reminds me of Christmas CDs, Christmas music, there is too much of it. You can see the pitches, it's "Free Willie" swims underneath the North Pole and they're going to make a movie like that soon. Aren't there too many of these things?

MALTIN: Well no I would argue that point. Because if you look back and think about say 60 years' time, how many prominent Christmas movies have there been over those 60 years that we're thinking about today? From the '40s, "It's a Wonderful Life," and "Miracle on 34th Street." from the '50s, "White Christmas." From the '60s, draws a blank. A lot of people drew a blank on the '60s. "A Christmas Story" comes in the '80s, "The Santa Clause" comes in the '90s. That's not too many over so many decade's time. So really the ones that have stood out do stand out because there's aren't that many that compete with them.

ROMANS: Leonard so let's say it's snowing at home, we have peanut brittle every where, you know we are starting to pull our hair out and I am in an argument with my mom and it's time to start to really get excited about Christmas. What are the three top movies you recommend people sit down and watch from any of those decades?

MALTIN: Well we've named them all. The one we haven't named is "A Christmas Carol." Now Charles Dickens in "Christmas Carol" is such a fool-proof story you can't louse it up. There's been a Mr. Magoo Christmas Carol, there has been a Muppet Christmas Carol. Mickey Mouse's Christmas Carol they're all good because you can't lose with that story. Now purists still believe the best of all is the British film from 1951 staring the great character Alstair Sim (ph) and this was made after they had done "Great Expectations." "Oliver Twist" these other wonderful Dickens movies. So they had Dickens down. And that early '50s film is still the perfect "Christmas Carol," but I like all of those others, too.

ROMANS: All right Leonard Maltin, "Entertainment Tonight" thank you so much for joining us.

MALTIN: Fun to be with you, thank you.

ROMANS: There's more to come on IN THE MONEY including the revamp of a holiday classic. See what a little recasting and some heavy editing does for "It's a Wonderful Life." And write to us about flicks, finance or anything else that happens to be on your mind. The address is


CAFFERTY: When it comes to real or fake, it says here that our Web master, Allen Wastler, prefers the real ones. We're talking about Christmas trees. Shame on you! Anyway, we're doing a holiday theme fun site of the week this week. Before we get to that we'll talk about Christmas trees.

ALLEN WASTLER, WEB MASTER: I'm bummed this year. I was looking at the stats from the National Christmas Tree Association.

CAFFERTY: I didn't get my report this year.

WASTLER: And according to my calculations, this will be the first Christmas where of the Christmas trees that are out there, more will be fake than real.

SERWER: Bravo!

CAFFERTY: Isn't that good for the environment?

WASTLER: You know what they grow Christmas trees like crops now. Do you cry when they harvest the wheat?


WASTLER: No, you don't. The Christmas trees are the same thing. The only thing I think, OK, mess, a little bit more messy, I'll give you that and for asthmatics a fake tree is nice but I think real is nice.

CAFFERTY: They smell up the house, the needles fall on the carpet and they're a fire hazard. Other than that it is a great idea to have a real tree.

WASTLER: Gee, Mr. Potter, you just kill me.

ROMANS: When you were growing up did you have a real tree or fake tree?

WASTLER: Actually we had a fake tree for a few years. Then my parents got divorced. We suddenly had a real tree. I don't know which parent was responsible for the fake tree before. But it was more of a family experience going out, you pick the tree, you bring it in. You're buying an experience when do you the real tree.

ROMANS: Frost bite --

WASTLER: Oh yeas and it is so -- when Christmas comes around, go up to the attic and get the dusty box and bring it down and shake all of the stuff out and put it back in.

SERWER: Martha Stewart had one on the cover of her magazine, collectibles.

ROMANS: China, it's another story of China taking over.

WASTLER: If your concerned about the imbalance of trade and what's going on in the United States, if you look at your fake tree, over 90 percent of them come from China.

CAFFERTY: It takes me five minutes to go in the basement. The tree is in two parts. You cannot tell it from the real thing because they're that good. I take it upstairs, I put the bottom down, I put the top on and I turn to my wife and say, "my part of this is over. Decorate it." Now why would I want to go out into the woods, get frostbite, drag the kids along, get that stuff all over your hands.

WASTLER: Don't you want to give your kids the memory of the mighty lumberjack, Jack. You used to be ranger Jack. Go out there --

CAFFERTY: We're not going to discuss my past. Let's move on to the fun site of the week.

WASTLER: Since you're into fast, you were talking about movies and holiday classics. Well of course "It's a Wonderful Life," great movie, very, very long. I found a 30-second version of it for you with bunnies, OK? Here you go.

ROMANS: Oh, the bunnies again!

SERWER: Roll 'em!


UNIDENTIFIED MALE: I'm going exploring some day.

UNIDENTIFIED MALE: I want to do something important. I'm leaving this criminal town.

UNIDENTIFIED MALE: If you don't stay, we'll vote for Potter.

UNIDENTIFIED MALE: You were' a scurvy little spinner.

UNIDENTIFIED MALE: The money is gone George.



UNIDENTIFIED MALE: Is daddy in trouble?

UNIDENTIFIED FEMALE: I'm your guardian angel.

UNIDENTIFIED MALE: I wish I was never born.


UNIDENTIFIED MALE: Mother, it's me. I want to live again. Mary!


UNIDENTIFIED MALE: Brother George the richest man in town.

UNIDENTIFIED FEMALE: When the bell rings an angel gets its wings.

UNIDENTIFIED FEMALE: That a-boy, Clarence.

CAFFERTY: That's just lovely. SERWER: I like that. You could you watch four Christmas movies in ten minutes that way.

WASTLER: That is right, it was long so they have a few outtakes if you want to catch up on some scenes.

SERWER: A little filler.

WASTLER: A little filler.

CAFFERTY: So get your artificial tree, watch "It's a Wonderful Life" in 30 seconds on the computer and get ready for New Year's Eve, right?

Thank you very much.

Coming up next on IN THE MONEY it's time to hear from you as we read some of your e-mails from the past week and for that matter, send us an e-mail right now if you are so inclined at Back after this.


CAFFERTY: Time to read your answers to our question about whether more technology helps your life or hinders your life.

An anonymous viewer wrote this "Technical gadgets are mostly a help to me but people who get too wrapped up in their gadgets have only themselves to blame. If you can't tear yourself away from the gadgets, it's because you have no self control."

Then we heard from John, "I just returned from a week off and found 630 e-mails and 127 voice mail messages waiting for me. I like many aspects of technology, but I'm concerned about the quality of the decisions we make under pressure to respond immediately."

And Greg from Nova Sosha, " I don't like cell phones or camera phones, or fax machines. All I ever see other people using cell phones for is to call someone 5 minutes before a scheduled meeting to say they will be on time?" Amen.

You still need to use some technology to check out our IN THE MONEY show page, at which is where you'll find the address for our fun site of the week and this week, it is also where you will find the e-mail question of the week.

On that note, I thank you for joining us for this edition of IN THE MONEY. My thanks to Lou Dobbs tonight correspondent Christine Romans, "Fortune" Magazine editor at large Andy Serwer, and managing editor Allen Wastler.

Join us next week, Saturday at 1:00, Sunday at 3:00 or you can catch Andy and me all week long on "America Morning" starting at 7:00 Eastern Time. Thanks again and Merry Christmas.


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