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Sony Spyware; Financial Adviser Moonlights; Early Christmas?

Aired November 19, 2005 - 13:30   ET


FREDRICKA WHITFIELD, CNN ANCHOR: Hello, I'm Fredricka Whitfield at the CNN Center in Atlanta. More of "IN THE MONEY" straight-ahead.

But first, here is what's making news right now.


I'm Fredricka Whitfield in Atlanta. Now back to more of "IN THE MONEY."

CHRISTINE ROMANS, CNN CORRESPONDENT: You know it's just the third weekend in November and Santa is in the shopping mall, stores are gearing up for big sales, and you haven't even thought about buying a turkey yet. Why does it seem like retailers are starting earlier than ever this year?

Our next guest says it's because they are. Dan Skoda is a Managing Partner of D&R Consulting, a firm that specializes in retail.

Welcome to the program -- Dan.

DAN SKODA, MNG. PARTNER, D&R CONSULTING: Thank you. It's good to be here.

ROMANS: Last weekend I was in shorts and a sweatshirt walking through my neighborhood and the stores were already decked out for Christmas holiday sales. Are they worried about all the reasons why people have not to spend a lot of money this year? They're trying to get you early?

SKODA: Well there's actually been a progression over the last few years of moving the shopping season more and more out of December and trying to get the customer first. There's obviously some pretty stiff competition amongst retailers. And this competition has really gotten everybody into the mood and attitude that the sooner we get the customer to spend in our stores, the sooner we're going to get their money instead of the competition.

There's really been kind of a rollover, if you take a look at it, over the last few years where the whole Halloween thing has gotten bigger and bigger. It used to be, a couple decades ago, you went and shopped for candy a couple of days before Halloween and that was it. Nowadays, it seems like Halloween starts right as soon as school begins. And as soon as Halloween is over, the retailers are into the Christmas holiday shopping spirit. SUSAN LISOVICZ, HOST: Yes, and you know...

SKODA: It's very -- go ahead.

LISOVICZ: I hate that, Daniel. I mean I hate the fact that once Halloween is over that you never see the pilgrims and the turkey and the pumpkins anymore. The fact, though, is that as much as we complain about it, consumers do respond to these early holiday sales, do they not? We are shopping earlier and earlier.

SKODA: Absolutely. Absolutely. You know the thing with Thanksgiving is, it's really not a children's holiday. And Americans love their children and children are a big part of the joy of the holidays. And I think that Americans feel that they have taken Halloween as far as they can take it and start buying those costumes early in advance and start thinking about Halloween decorations.

And then right after that, they want to keep their kids happy and excited, so they start thinking about the holiday shopping, whether it's for Christmas or Hanukkah or whatever. It's very focused on children. And Thanksgiving just isn't focused on children. It's focused on us and eating.

ANDY SERWER, EDITOR-AT-LARGE, "FORTUNE" MAGAZINE: Yes, Dan. I mean this stuff is out of control, Dan. I mean you know St. Patrick's Day is three weeks. Arbor Day is like four days now. We're stuff -- you know I mean we're suckers. It's all propagated by Hallmark, Mattel and Federated. You know when is this going to stop? I'm getting sick of it. I got to tell you, I really -- you know every day is a holiday or leading up to one or we just had one.

LISOVICZ: You're a grinch. You are a grinch.

SERWER: I just want some normal days. I really do.

SKODA: Well, the thing is is that we, as Americans, like to complain about this. But the fact of the matter is, is we part with our money. And over the last few years, we've seen a continuing growth in retail sales and it's been because the shopping season has expanded further and further into October and November.

ROMANS: Dan, I'm going to have to side with Andy here. I can't believe I'm saying it, but I have to side with Andy here.

SERWER: Every once in a while.

ROMANS: And I'm wondering if we're starting to cheapen these holidays, though? I mean aren't there people who, for example, Nordstrom you point out is one of these places that's very loyal. It only has a few sales a year. It doesn't go crazy and start Christmas in July. And their customers are very, very loyal to this company. I mean, there is the consumer who kind of feels like when it's Indian Summer and you're shopping for the holidays, it's a little weird.

SKODA: That's true. And fortunately there's a variety of people out there. And some people that have grown accustomed to Nordstrom's and the traditions that they have, whether it's sales or the holidays, really enjoy that kind of shopping experience. And those are the people that gravitate to that.

On the other hand, most Americans love to be festive and love to shop whenever they can, and do enjoy shopping. And this gives them another reason to get out there early. And retailers...

ROMANS: But I mean when there's a sale every four days, though, you feel less urgency to go to the sale is sort of what I mean. I mean, if you're buying Christmas sales you know in end of October, well you know there are going to be another 30 sales before actual Christmas. At what point do they start to you know cannibalize?

SKODA: Well, one of the things that a lot of people don't realize is is that most people don't get Christmas bonuses like they used to. And because of that, most people make the same amount of money in October as they make in November and December. So the amount of shopping that you can do earlier, just kind of spreads it out a little bit easier. And it's probably a little bit easier for people to absorb.

LISOVICZ: Yes, I kind of know about that lack of holiday bonus. But that's a whole other subject.

SERWER: They get paid a very little amount of money all year round.

LISOVICZ: I love my job.

You know there is this whole cult of shopper that really does, to Christine's point, that you know wants to go to special sales and feel like they get special value. If in fact the holiday season gets earlier and earlier, how do you differentiate Black Friday? How do you get those mid-December sales? Do you really -- do the stores really cut into their profit margins at that point or do they have this whole warehouse full of these last-minute items that they bring in to fool us again?

SKODA: Well there's a couple of things that happen. With the earlier shopping, obviously, Chris, the stores get an early reading on Christmas best sellers and it gives them an opportunity to recover and get back in stock on some things that they can get back in in a hurry. And it does allow for that getting the good business all the way up to the last minute.

One of the things that happens is is that there's still a lot of people that do feel like they like to shop when the snowfall is coming down and all of that stuff. And as they get closer to Christmas, and there has been a gravitation, actually, out of the middle of December to the last-minute shoppers that have to have that last-minute rush. And the people that are responding that are the people that are responding to the earlier promotions and retailers bill to that.

SERWER: It's going to put Santa out of business, though,...

SKODA: What happens is is that... SERWER: ... don't you think?

ROMANS: Dan Skoda, thanks.

SKODA: Well the last-minute shoppers really enjoy that kind of feeling of being a last-minute shopper. And then remember you also get a tremendous input after Christmas where you really get the holiday shoppers that are really the bargain hunters.

ROMANS: Right.

SKODA: And those are the people that buy ornaments for next year and they even buy gifts for next year.

ROMANS: Dan Skoda, Managing Partner at D&R, thank you so much for joining us and deconstructing the shopping holiday sales for us. Thanks.

Lots more to come here on IN THE MONEY.

Up next, rhyme and reason. He's a New York mortgage broker by day and a rapper by night. Find out how he is bringing the two together in his music.

And the Sony surprise. We'll tell you about the secret component on some Sony CDs that's blowing up in the company's face.


SERWER: By day, Terence Bradford travels around New York and Connecticut in a suit and tie advising clients on personal finance issues. By night, Bradford puts on a different hat, performing under the name Billy Shakes. He advises a very different crowd on topics like home buying and investing.

Terence Bradford joins us now to talk about his two careers.

Terence, welcome to the program. I've got to ask you, how did you get started doing this, being in financial services and rapping at the same time?

TERENCE BRADFORD, PERSONAL FINANCIAL ANALYST, PRIMERICA: Well, actually I started rapping before I was in financial services. And in order to kind of differentiate myself from every other rapper out there, I wanted to rap about my life and what was going on, the things that I really knew about, which was Wall Street. And you know every other rapper that I saw out there was talking about you know their topics, the street game, the drug game.

And I started to notice that you know the hustle on Wall Street is the same hustle that is in the street, growing up in the projects where I did in the Bronx, New York. And I decided that's what I was going to rap about. At the same time, I had the opportunity to increase the financial literacy of the people who are listening to my music. And I kind of feel like I'm the only rapper out here you can listen to my music and make some money. LISOVICZ: But, Terence, I mean, Billy, you still talk about or rap about cars and women and things like that, too, right?

BRADFORD: Yes, actually, I do. And I make sure that I'm not doing it in a real kind of preachy manner. I make sure that I speak in a language that my listeners can you know really understand and relate to. You know I like to floss. I like to have jewelry. I like to have nice cars. But at the same time, if I go out and buy a Benz, I'm also going to own DaimlerChrysler stock.

ROMANS: Very good point. You say you know a kid wants to buy a $300 pair of Nikes. You rap about how maybe you should buy NKE instead.

BRADFORD: That's right.

ROMANS: You want to talk about in the drug business, maybe you should think about buying J&J.

BRADFORD: That's right.

ROMANS: Tell me a little bit about what that's like talking to the rap community, the hip hop community? You know Susan and I work on the floor of the New York Stock Exchange, and hip hop and NYSE, they are two things that I haven't really seen going together very often.

BRADFORD: Yes, no one has actually really taken the time, I think, to do it, because in order -- the biggest thing about rap is that you have to be authentic with it. You have to be real with it. The biggest selling artists are kind of real with their music. And I think no one has really talked about it because no one really was in a position I am, you know being Series 7 licensed, work on you know the biggest firms on Wall Street and still have the ability to rap. And I think that you know people are really receptive to it, because anytime you're talking about money in any capacity,...


BRADFORD: ... you know people are open to it. Whether you're talking about making it or using it and buying things with it, people are always open to it.

SERWER: Well, Terence, let me put you on the spot a little bit. I don't know if that's a real hip hop venue you're sitting in right there, but can you give us a little bit of a flavor, a taste of some of your rapping?

BRADFORD: Yes, definitely.


BRADFORD: In my song, "Dollar Cost Average," I say trying to be a star, you spending hard, 250 weekly at the bar, a grandpa monk (ph) get you 12 a year, call me Bill Maher, I got brand new rules. Invest instead is what you do, six years later, got 72. Ten percent is a good return, got 100 grand, more money to burn. Neighborhood pusher with legal weight (ph), no not drugs, it's real estate. No money down, plus closing costs, fix it, rent it, you the boss. Refinance that rate you got, your monthly payment going to drop. You looking up and down the block.


BRADFORD: You got them involved with color tiles (ph). You hollering where the money at? Stock market is where the money at. What you know about getting that? J.P. Morgan I'm getting that. Spread Nextel, I'm feeling that. Berkshire Hathaway is feeling that. Charles Schwab, now I'm rid of that. It's just a fact day trading is a rap.

LISOVICZ: Yes, and buy low, sell high, yes, that's my motto.

BRADFORD: That's right.

LISOVICZ: You know you were talking about the -- you know we were talking about the New York Stock Exchange. I remember when I was on the floor with Russell Simmons and LL Cool J. They had to get a special dispensation so that they didn't wear suits and ties. They were there in their, you know, baggy pants and their loose shirts.


LISOVICZ: I mean, it is actually good for you, business both by day and by night.


LISOVICZ: Because you're into a whole community that is underserved. And let's face it, you're the only rapper who's talking about stocks and bonds and funds.

BRADFORD: Exactly. And I'm the only person I really feel that's going to talk to these people, because you know your average warehouse brokerage firm isn't going to talk to somebody who can only put away $50, $100, $200 a month. I will. I'll talk to people about their investments. I talk to people about insurance. I talk to people who want to purchase a home or refi and get out of debt. I do it all for individuals who are really interested in getting their finances together and becoming debt free and financially independent.

ROMANS: Terence, you might have really struck gold here, because for years and years you know the Federal Reserve and the banking system in this country has been trying to figure out how to tap into what they say is a community that has been really hard to get banked, the unbanked community.

BRADFORD: That's right.

ROMANS: And maybe they've just been doing it the wrong way. Maybe they haven't been speaking the right language. How has the response been? BRADFORD: It's been absolutely fabulous. Since the article came out in "Fortune" magazine, the response has been so great. People have come to my Web site,, and have just you know poured their hearts out to me. Telling me, you know no one will talk to me about my investments. No one has ever taken the time to you know really explain how a mutual fund works, how investments work, you know the Rule of 72, and you do it in your music. And you know you make it in a way where I can listen to it and understand it. So the response has been great. I would love for more people to you know respond to that.

And also, I'm trying to put together a tour for myself to go across the country. It's called my Billy Shakes Financial Freedom Tour...

SERWER: Right.

BRADFORD: ... where I go to different schools. I was just at Roger Williams about a week or so ago and spoke to the students. I do a lecture where I'm in Terence Bradford mode talking to the kids about the importance of debt freedom and financial independence.


BRADFORD: Then I change clothes into Billy Shakes and do a performance of my song so people can see you don't have to just be one person in your life, you can pursue your dreams and also you know keep your money straight.

SERWER: Now are you going to be able to come up with raps and rhymes for the words Bernanke and Google? Is that possible? Is that possible?

BRADFORD: It's going to be very challenging. I just put a song with Greenspan. And now that Berneke (ph) -- Bernanke could be going in to his position, it's going to be challenging, but I think if anyone can do it, I definitely can.

SERWER: Thank you, Bernanke, or something. I don't know what.

LISOVICZ: Karen (ph)...

ROMANS: Spanky...

SERWER: Spanky. Yes.

BRADFORD: Spanky with Bernanke.

SERWER: Yes, I'm not a rapper, yes.

LISOVICZ: Please keep it to the professionals.

SERWER: Keep it -- I'll let Terence do it, no. Yes, yes, right.

LISOVICZ: Terence Bradford who fancies himself as the Suze Ormond of rap. BRADFORD: That's right, I want to be the Gordon Gekko of hip hop.


BRADFORD: The Suze Ormond of you know of hip hop.

LISOVICZ: There you go.

BRADFORD: But I think that...

LISOVICZ: Not greed is good, saving is good, investing is good, right, there's a big difference?

BRADFORD: That's right. That's right.

LISOVICZ: Terence Bradford, Personal Financial Analyst and rapper, thanks so much for joining us.

BRADFORD: Thank you so much for having me. I appreciate it.

LISOVICZ: Coming up, spy music. Allen Wastler will tell us how a spyware controversy is boomeranging on Sony.

And if you want to rap about computer security or anything else in the news, drop us a line. The address,


LISOVICZ: The next time you pop a Sony CD into your computer, instead of just getting your favorite music, you might also download some nasty spyware.

Allen Wastler has the details in today's "Inside Out," a true disaster story.

ALLEN WASTLER, MONEY.COM: This is one that if you buy CDs and you like music, it just gets you a little bit angry, OK?

LISOVICZ: Everybody.

WASTLER: All of a sudden Sony has to recall 4.7 million CDs.


WASTLER: Why? Well, it turns out that they decided, you know, we hate it when everybody copies our music?


WASTLER: So they put some software on the CDs. The software prevents you from copying it over and over again. You can only copy a little bit. Now I already hate that.

Second, there's this lame player that you use. So if you put it in your computer and play it, as 36 percent of people do, then you have to use their lame player and everything, you can't use your regular player.


WASTLER: So that's bad.

Now it turns out that it plants spyware on your computer that can sort of -- that can conceivably call back to Sony and say, hey, not only does he listen to Johnny Cash, but he also listens to this, that and the other.

ROMANS: You're kidding?


SERWER: It's none of their business.

WASTLER: And I haven't finished yet.


WASTLER: You'll love this last one.

SERWER: Even madder (ph).

LISOVICZ: Let him rant.

SERWER: Even madder (ph).

LISOVICZ: Let him rant.

WASTLER: It leaves a back door on the computer. So the savvy hacker can all of a sudden use your computer as a drone.


ROMANS: And walk right in.

WASTLER: Or walk in.

SERWER: Spank me (ph) very much.

LISOVICZ: And there are so many things that are bad about it, but the cure was even worse.

WASTLER: That's where they bungled it. They came out and said, well we'll do a patch. You can do a patch and it will fix your computer. And then finally the outrage grew and grew and grew until finally this week they said, OK, OK, we'll recall the CDs, all right? But they haven't really apologized for this. And they haven't really come out and said, look, that was a mistake. We won't do it again. There's just...

ROMANS: If you're somebody like me, you just put the CD in there and you don't even know it's going on, too.

SERWER: Right. ROMANS: I mean I'm not the most savvy -- what kind of CDs, like just regular...

SERWER: Music.

WASTLER: CDs of Frank Sinatra. They are doing some...


WASTLER: ... reissues, Frank Sinatra, some of the older things. So it'd be like...

SERWER: And you know Andy Lack, the head of this business, is under fire because of this and the repo (ph).

WASTLER: This is just under...


WASTLER: ... a lot of fire.

SERWER: That's right.

WASTLER: But there is a silver lining,...


WASTLER: ... because, after all, we're "Inside Out," right? And that is an event like this makes people aware of what the music industry is trying to do to limit their freedom to use the music...

SERWER: Right.

WASTLER: ... that they purchased at an overpriced price, mind you, so just copy it and do what they want to do.

SERWER: Next time go to iTunes.

WASTLER: I'm paying -- you know I'm paying...

SERWER: That's what I'd say.

WASTLER: ... 15, 20 bucks for a CD,...


WASTLER: ... for one song that I like and the rest is garbage.

SERWER: Go to iTunes.

LISOVICZ: OK. Let's...

WASTLER: iTunes.

LISOVICZ: ... cool Allen Wastler down and go to our fun side here. SERWER: Hello. Hello.

WASTLER: OK, speaking of music,...

SERWER: Deep breaths.

WASTLER: ... Thanksgiving is coming up. Let's hear from a turkey.


SERWER: Yes, but will it be singing on Friday morning, that's my question?

LISOVICZ: Is that the one pardoned turkey by the president?

WASTLER: It might be the one pardoned turkey. Anyway, it's lots of fun.


ROMANS: Really.

LISOVICZ: I mean it brings us back to that golden age of disco, Donna Summer.

WASTLER: There you go, it will come back. It will come back.

LISOVICZ: And we'll survive.

ROMANS: I always think Thanksgiving and disco, personally, yes, right, and that ball, the strobe.

SERWER: And football.

LISOVICZ: OK, thank you, Allen.

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 you can send us an e-mail right now. We're at


LISOVICZ: Now it's time to read your answers to our question about whether you've ever done anything embarrassing on a job interview.


LISOVICZ: This is painful.

John in Illinois wrote, "I thought I did well at a job interview only to learn when I got home that I had a big lipstick stain on my cheek from my girlfriend who had given me a 'good luck' kiss earlier in the day. Needless to say, I didn't get the job."

We're sorry for you.


LISOVICZ: An anonymous viewer wrote, "During my job interview, I spilled piping hot coffee all over my interviewer and his papers. I actually got the job, but they still call me the 'coffee lady.'"

Lucky you didn't get sued.

And Kris wrote, "For some reason when my interviewer asked why I wanted this job, I blurted out: 'sometimes you have to take what you can get!'' Restraint. "The interview ended at that very moment."

Now for next week's "Email Question of the Week." Are you planning on spending more or less this holiday season than you did last year? Send your answers to And you should also visit our showpage at That's where you will find the address for our fun side of the week and the disco singing turkey that will survive.

SERWER: Yes, baby.

LISOVICZ: Thanks for joining us for this edition of IN THE MONEY. Thanks to "Fortune" magazine editor-at-large Andy Serwer, "LOU DOBBS TONIGHT" correspondent Christine Romans and managing editor Allen Wastler. We'll see you back here next week, Saturday at 1:00, Sunday at 3:00. See you then.


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