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CNN IN THE MONEY

Effect on President Bush's Deficit Decisions; What Really Counts in Housing Market; Men and Valentine's Day Gifts

Aired February 10, 2007 - 13:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


FREDRICKA WHITFIELD, CNN ANCHOR: IN THE MONEY is coming up straight up first a look at the top stories.
Democratic Senator Barack Obama is now officially in the race for the White House. He spoke from the old state capital in Springfield, Illinois where he served as state Senator. Abraham Lincoln served there in the Legislator as well, before becoming president himself.

In Iraq, General David Petraeus is the new commander of U.S. forces. He says the country is doomed to continued violence if U.S. forces and Iraqi forces fail to work together. The U.S. military in Iraq may produce evidence that Iran is giving weapons to Iraqi insurgents. Pentagon officials say a briefing could be held tomorrow. The Bush administration has long accused Iran of aiding insurgents.

We will update the top stories at the bottom of the hour. Now time for IN THE MONEY.

ALLEN WASTLER, MANAGING EDITOR, CNNMONEY.COM: Welcome to IN THE MONEY, I'm Allen Wastler. Coming up on today's program, the buck starts here. See how President Bush's deficit decisions today could play out down the road.

Plus, reading between the signs. Find out what really counts when you are trying to figure out the housing market.

And honey, you shouldn't have. We will look at why so many guys blow it when they buy a Valentine's Day gift.

Joining me today, Jennifer Westhoven and Jen Rogers. Jen and Jen welcome.

Everybody is jumping into the presidential pool. Everybody wants a shot at the big White House, you know. It is going to be open in a year and a half. I did a quick count, over 16 candidates all of sudden sort of jumping in or playing in the water saying I'm thinking about it. You know. I figure it is about two things one name recognition, because a lot of these folks, you never heard of them. Two, money they say it is over $500 million now.

JEN ROGERS, CNN CORRESPONDENT: It is launching a new drug. You have to raise so much money.

JENNIFER WESTHOVEN, "HEADLINE NEWS" CORRESPONDENT: That's just to win the nomination. Let alone the presidency. A huge amount of money that they have to raise. I noticed did you see that Mitt Romney has already raised more than $1 million on the Internet in a month, now that's a drop in the bucket compared to $500 million, but that could be a new trend.

ROGERS: Not as heavy lifting as having to shake the hands and pick up the phones. My strategy would be for 2012, if you go in now, you get your money and then maybe put it in the market. That could make your job easier when you get to 2011.

WASTLER: Announce now and play around. One quick thing when John Kerry said he wasn't look how quick they gobbled up his money.

ROGERS: It is a land grab.

WASTLER: It is big. Now, President Bush unveiled his $2.9 trillion budget for 2008 this week. With more than $200 billion of the plan to go toward the wars in Iraq and Afghanistan. Tom Foreman has a look at what the money being put toward war there could pay for here in the U.S.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT (voice over): If you study Iraq in purely financial terms and say, "show me the money," it is quite a show. This is how much American taxpayers are paying for the war more than $350 billion and still climbing. Based on government records, compiled and computed by a progressive think tank, the National Priority Project. Ken Pollack is with the Brookings Institution.

KEN POLLACK, BROOKINGS INSTITUTION: One of the great tragedies of Iraq is that the administration has mismanaged this war so badly that it has wound up costing the taxpayer far more than it might have had things been handled otherwise.

FOREMAN: How much money has been spent on Iraq? The Priorities Project estimates it is enough to hire more than six million teachers. Enough to build more than 700 new elementary schools in each state, eight million police officers could be hired or six million cargo inspectors for ports or we figure every American driver could get free gasoline for a year. In the complex world of government budgets, the total estimate can be fairly questioned but it's a lot more than the White House is suggesting.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Today I'm sending the Congress a wartime supplemental appropriations request of $74.7 billion. To fund needs directly arising from the Iraqi conflict and our global war against terror.

FOREMAN: Government investigators say billions have been lost to fraud, mismanagement, or bad bookkeeping. The spending won't end when the fighting does. American troops and equipment have held up well.

MAJ. GEN. DON SHEPPERD, U.S. AIR FORCE (RET): I can see the cost of the war going up another 50 percent or maybe even doubling because of what we have to do to replace personnel, ammunition, and equipment over a long period of time. FOREMAN: Plenty of people argue that establishing democracy anywhere is worth whatever it takes. And, of course, no one can put a value on all the brave young lives lost or calculate the cost of leaving. But the price tag of the war so far is impressive. In the time it took you to watch this story, Iraq cost America almost $500 million more.

Tom Foreman, CNN, Washington.

(END VIDEOTAPE)

WASTLER: If all those big numbers didn't shock you maybe this will. They may not add up to all that much in the long run and the long run is what our first guest is thinking about. Justin Fox is a business and economics columnist at "Time" Magazine. Very familiar with his work. Justin, welcome.

JUSTIN FOX, ECONOMICS COLUMNIST, "TIME" MAGAZINE: Thanks.

WASTLER: Before we start talking about the long-run problem, let's talk about the short run. We are talking about budgets and cost of war these days. Is that worrying you or not?

FOX: Well, what's interesting about the budget right now is if it weren't for this cost of the war there would not be a deficit. We would have a budget in balance right now, which is kind of an interesting thought.

WESTHOVEN: When you look at how much we are spending on Iraq, though, and you adjust for inflation and the percentage, gross domestic product, how does this compare with other wars like World War II and Vietnam?

FOX: Tiny. We are just -- we have a massive economy now. Our GDP is something like - I don't have my GDP numbers memorized but it is about $13 trillion a year right now. And so you look at it over time. Obviously if we kept doing this every year for infinity, that's really expensive. But assuming that wars end which Vietnam and World War II did, this is a small chunk of our overall economy going towards this.

ROGERS: President Bush says that the deficit is actually shrinking. That seems like good news. Does he get credit for that?

FOX: Except there was not a deficit when he took over. That's sort of the issue. He has his new budget calls for the budget being in balance by 2012 once he's gone. It is shrinking because the economy has been strong the last few years. It is not because of any really significant spending restraints so far by the Federal government.

ROGERS: Is the economy strong because of tax cuts, does he get credit for that?

FOX: Part of the credit. In general, the U.S. economy these days is just this amazingly resilient thing. And I -- who knows with the tax cuts. I think they helped some but if you hadn't had the tax cuts you probably would have had a deeper recession a couple of years ago but I think things would be going OK now and you wouldn't have a budget deficit.

WASTLER: Let's talk about the budget right now that he put forward before Congress. That thing is four volumes; it is a big honking budget.

FOX: I only printed out about 30 pages. That was too much for me.

WASTLER: It's basically a starting point where they are going to start dickering. He has a Democratic Congress to dicker with. What's your outlook on that?

FOX: One of the really interesting things is that the issue in the first few years of the Bush administration is he would present his budget and then go to Congress and get even bigger. And he wouldn't veto it because they were all Republicans and they were all friends. And you look back in history and that's been -- that's what happened in the 1960s and Lyndon Johnson and a Democratic Congress. When you have the President and the Congress in the hands of the same party the president's budget gets bigger and keeps going. When you have different parties, they are going to fight over it and it might be better for our fiscal policy going forward.

ROGERS: You think that there's any hope that there's going to be something on the horizon in the near term that can help solve that Medicare crunch?

FOX: I haven't heard -- I mean, that's one interesting thing. You can't be too hard on Bush for this. Because I haven't heard anything from either the Democrats or the Republicans to really say OK here is how we fix this. It is too uncertain.

ROGERS: No one knows.

FOX: No one knows. It is tied up in bigger questions of how we organize our health care system in this country. And I don't think anybody has figured that out yet. I think we will figure it out. But it is going to be ugly and they are going to be really, really hard decisions to make down the road.

WASTLER: Ugly, hard decisions. Thank you for cheering me up there, Justin.

ROGERS: When we come back, how to spot the next job, see what a company needs to look for if it wants a leader who delivers.

Also ahead, forget macro. Think micro. Find out why your local housing market might make more sense to look at than the national one.

Sleeping on the job, we will tell you about an outfit that wants to help you catch some Zs on company time.

(COMMERCIAL BREAK)

WESTHOVEN: What does it take to be a good CEO? It is a $1 billion question for a lot of companies and not all of them get the question right. But corporate boards in search of mister or ms. right have plenty of good examples to follow. Richard Tedlow joins us now to talk about what makes a good CEO in America today. He is the class of 1949, professor of business administration. He's also the author of the new book "Andy Grove, The Life and Times of an American." Welcome to the program.

RICHARD TEDLOW, AUTHOR, "ANDY GROVE:" Thank you very much. Pleasure to be here.

WESTHOVEN: Over years of covering business and I'm sure for you years of teaching business and studying it, I have seen a lot of different CEO personalities and styles. What is it that they need to have in common to really be a successful CEO?

TEDLOW: The variety that you have spotted is real. At this level, what matters the most is character. And it is very, very hard to find out in advance whether the person that you are recruiting for example has the character that's necessary. I think I'm paraphrasing Warren Buffet when he said there were three things that it takes to build a great business brains, energy, and character. Without the third, the first two will kill you.

So if you have a really smart energetic person without character, you have got -- that's Jeffrey Skilling. Have you someone that will wreck a company.

WASTLER: These days we seem to get a lot of superstar CEOs. Ones that are flashy and they can do no wrong. You know, if you send Steve Jobs over to Ford, let's say, would he be able to turn that around on the basis of his superstardom? Does any CEO if they are a superstar could they do any industry?

TEDLOW: No. You know, Steve Jobs is a unique talent. I wouldn't want to see him in the Ford Motor Company. He is a master design. Who knows?

ROGERS: Certainly improve the stereo product.

TEDLOW: You have the best music. And think of what Steve Jobs did. First of all, here is a man that's fired it is a CEO of Apple in 1985. He's 30 years old and he is fired as a CEO. Anybody can get hired. Everybody has a job. Look around outside. But to have on your resume fired as the CEO when you are just 30, I mean, that differentiates you. Then they bring him back as the corporate savior. But he knows the company. There is an ecosystem that he knows who to go to for publicity and he knows who to go to for advice and he knows who he can trust and to just rip a superstar CEO out of that environment and place him or her into a brand-new environment without that kind of support is a recipe for catastrophe, in my opinion.

WESTHOVEN: What about your -- you were talking a little bit before about character and integrity. Is that something that we all sort of -- I mean as a society, forgot about when we started with these rock star CEOs? I can remember the cover of -- I don't know if it was "Forbes" or "Fortune" and Dennis Kozlowski and the helicopter in the background and for a long time it was about, you know, really building companies, buying as much as could you and having really big results and nobody seemed to pay any attention to whether the numbers were good or character and integrity and how they play into the numbers.

TEDLOW: He paid a price. I think you put it very well. Character is something we forgot about. And the result is, I think, Mr. Kozlowski is in jail, either there or on the way. You can build a business without it.

WESTHOVEN: Do we know that now?

TEDLOW: Sigmund Freud had a phrase, knowing but not knowing. They know it but don't know it. The lure of the answer person, you know the person that you can choose and is going to solve a lot of problems that are not easily solvable by throwing a switch, that allure is very strong.

ROGERS: I have to ask you real quick. Is it restraint part of character and restraint in how much you get paid? When I think of CEOs, I think a lot of our viewers do, your blood starts to boil because you see these huge packages. Are they in a lot of trouble here because they have not shown enough character? They haven't stood up and said I don't need to get paid this much?

TEDLOW: I don't know. I mean, first of all, you are right. This pay business is ridiculous. I would like to get fired from some of these jobs so I could get the pay package. Or some of these people who are paid $200 million a year, if they were paid $199 million and give me the $1 million, I would feel good about life. I think that the whole structure of compensation committees and of boards and of the way that they evaluate and compensate CEOs simply has to be reworked. It is not functioning properly. These numbers are absurd.

WESTHOVEN: It is to be hoped we learned something from all of this. Richard Tedlow telling us what makes a good CEO.

Stick around. We will have you on later in the program if you don't mind. Thank you very much. He's the class of 1949, professor of business administration at the Harvard Business School and author of a book about Andy Grove.

After the break, the next resort, Disney's thinking of expanding its theme park business with a slew of resorts. Find out whether Wall Street is excited.

Plus, maybe that's said of kitchen utensils was not such a great gift for your girlfriend. Why some men are clueless about buying Valentine's Day gift.

There is love in the room. Find out why you ought to think twice before you start dating a colleague.

(COMMERCIAL BREAK)

WESTHOVEN: Two of the world's biggest media companies released their earning number this week and they also revealed their plans for the future. Susan Lisovicz joins us from the New York Stock Exchange. She has been following all of that news from Disney and News Corp. Susan that was a lot of fun stuff, I mean from Disney and then there was some good business TV gossip from Rupert Murdoch.

SUSAN LISCOVICZ, CNN CORRESPONDENT: How about that? Rupert Murdoch has been talking about it for some time. But he gave more details, so we got not only News Corp's earning numbers which exceeded expectations but we had Mr. Murdoch talking about business news which typically attracts a smaller audience. It is the kind of audience that advertisers like. Because they just don't buy cars. They buy things like Ferraris; they don't just buy wine they buy cases, magnums of the really good stuff. So he's -- you know, he -- they have a track record, obviously, with the Fox News channel and they are going to do it the same in business news.

One of the best things and I'm sure Jennifer, you notice this, too, is that Murdoch says he's a big fan of "Borat," that he has seen it about three times. It was a great addition to 20th century Fox and he said that Sasha Baron Cohen is going to do a sequel. We can laugh at ourselves.

WESTHOVEN: How are the Disney scorecards?

LISCOVICZ: Disney profits were terrific, exceeding expectations. Nearly doubled and also, the box office helping out, something called "Pirates of the Caribbean," helped also yet another Pixar animated film "Cars."

WESTHOVEN: Finally I just want to ask you about Home Depot a lot of turbulence there. Big change at the top, we are actually starting to see some signs that the new CEO is not at all like the old CEO.

LISCOVICZ: Meet the new boss, not the same as the old boss. Frank Blake coming in with a very different style than the imperial CEO that was Bob Nardeli. One of the things that he's given up quietly abolishing, according to "The New York Times," is the free lunch where Nardeli and his deputy use to lunch every day by themselves in the private dining room. He's saying you have to pay your own money to other managers and actually, you know, talk to the rank and file.

WESTHOVEN: Susan Lisovicz, thank you very much for the updates on the big stories on Corporate America and what's been happening on Wall Street. Thanks.

That's a great topic for us to turn back to our guest Richard Tedlow, who is a professor at Harvard Business School. And really, you know, an author who you published a lot about CEOs. We want to bring you back to ask you a little bit about this change that we are seeing at the Home Depot. I mean, what a swing of the pendulum here from sort of an imperial CEO to someone that's saying let's all eat with all the workers. Let's not be so important.

TEDLOW: It is a big change. I wonder how popular he is with his fellow CEOs because by bringing attention to these kinds of outrageous compensation packages, it means they all have to eat now with the normal people and actually pay for their lunches. They may not be too happy about that. You know, Nordeli, prior to Home Depot, worked at G.E., G.E. is the home of one of the most outrageous final compensation packages ever which is Jack Welsh. By the way, I would like to you pay for my newspapers. You know, how that exactly from a retired CEO was not explained.

WESTHOVEN: Well, Richard Tedlow, thank you for sticking around for that.

Coming up on IN THE MONEY, sign language. See if you can tell the state of the housing market by the state you are living in.

Later, winners and snoozers. Find out if catching a few Zs or winks during the workday could make you a better employee.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SENATOR BARACK OBAMA, (D) PRESIDENTIAL CANDIDATE: I stand before you today to announce my candidacy for president of the United States of America.

(END VIDEO CLIP)

WHITFIELD: Senator Barack Obama formally joining the race for the Democratic presidential nomination. He made the announcement in his home state of Illinois at the old state capitol where Abraham Lincoln once served.

Even more snow today in parts of upstate New York. Some places have received more than 100 inches of snow in the past week. Governor Elliott Spitzer has issued a disaster declaration for Oswego County north of Syracuse.

Three more U.S. troop deaths in Iraq in Diyala Province, they were searching a building for weapons when an explosion occurred. Four other soldiers were wounded.

Coming up at the top of the hour, Anna Nicole Smith's death raises several legal questions. Our legal experts weigh in. Now back to more of IN THE MONEY.

ROGERS: In this week's "Family Money:" location, location, location. Yes, it is a tired old realtor cliche. But it may say more about the current housing market than you would think. Our next guest says that some of the big picture real estate numbers like the glut of about a million homes sitting vacant on the market reported this week by Merrill Lynch are misleading to the average homeowner. Christopher Mayer is the professor of real estate at Columbia Business School. Welcome to the program.

So one million homes that are vacant and they are for sale, seems like a huge headline to me. It is the highest level that the Census Bureau has recorded since they started keeping track. But you are not worried? CHRISTOPHER MAYER, COLUMBIA BUSINESS SCHOOL: I'm worried if you live in certain markets, Phoenix, southern Florida, Las Vegas, southern California. That's where a lot of those vacant properties are. There are significant numbers of those that are condominiums as opposed to single-family homes. They are only vacant because that's where a lot of investors have been sinking their money.

WESTHOVEN: So there is no bubble. There never was a bubble. I get the impression that's your opinion about the bubble. What do you really think about what's happening in the short term, over the next six months, over the next year? There are a lot of Main Street economists who think that the prices will still keep coming down even if they are just dripping down, it is not a crash. But it is coming down a little bit.

MAYER: I generally agree with that consensus. I think in most markets around the country again with the exceptions of some of the markets I talked about, and with the exception of condominiums in a broader set of places, I do think prices will bounce around a little bit. You know, if you are in some of the stronger markets, you know, Texas, for example, or in Carolinas, I think you might see things a little better than that. Maybe they will be a little bit of appreciation. But I think we are just going to bounce around a while and that's probably good news if we work off some of this inventory we see transactions, which are still strong continue at this pace. And after all, if you are somebody looking to buy a home, for the first time in a while, you are actually going to have choices.

WASTLER: Professor, the Merrill Lynch Report, what they seem to be arguing was that that number of vacant homes out there is actually sort of a telltale sign of speculation in the real estate market. People who bought houses thinking that they would flip them right away. And what they are worried about is not so much the absolute number but that some of those speculators are going to begin to panic and start cutting prices in order to bail out real quick and once a few do it everybody runs to that side of the boat and then the whole boat tips, so to speak. How big a factor is speculation?

MAYER: I think in some of the markets that I talked about, I think speculation has been a factor. I think we are going to see a little bit of that. The issue is I don't think that is what's going to happen. I think what will happen is the speculators will stick with their prices. They may lose their homes. And we are already seeing increases in delinquencies in the market. And then over time, those things will work their way through the foreclosure process and we may see some declines in prices in the places where there are those vacant properties.

ROGERS: One place I'm seeing some competition, I have been looking in the rental market, I know here in New York, obviously, it is a different story than a lot of the rest of the country. But prices are really high right now here. Is that something that's happening across the board that because people don't want to get into buying right now, they are sitting on the sidelines and they are renting for another year, maybe and that's pushing rental prices up? MAYER: We have certainly seen some of that go on. Across the country, we have seen rents raise much faster levels than they had for the last several years. And that so-called arbitrage between renting and buying, buying does not make sense because rents are so cheap, no longer looks so cheap. I think we will see some of that go on. I think that, you know, there are people that should be renters. I think some of them are sitting on the sidelines. We have seen about five million new homeowners come into the market in the last decade or so. And I think there is a limit of how many people ought to be buying houses. You know, when you are younger, you are moving around a lot. You know, maybe you shouldn't be a homeowner right away. Maybe you should be renting.

WESTHOVEN: That was a perfect lead-in to my next question because I just decided to rent for another year because I want to wait it out and I'm looking to see if I want to buy. What kind of advice do you have for people that are thinking about buying right now? There are the potential homeowners. We are not talking about necessarily the sub prime market. That's a big market that's having a lot of problems. People out there who want to buy, what do you think they should be doing right now?

MAYER: Here's the advice I give my students and the advice I would go give you as well. Which is if you are moving to a place and you can find something to rent, and you are not sure how long you will be there, I think renting makes a lot of sense. If you are in a rental place you like. I think it also makes sense -- there is no urgency to move out.

However, if you are looking at, you know, taking a job as my brother and sister-in-law were, moving from Indianapolis to Philadelphia and they were trying to figure out what do, for them renting just isn't the viable option. They want to live in a place with their kids. They have, you know, a family. They don't want to move around a lot. My advice to them was buy comfortably and you are going to be there a while. Even if there's softening in the market, the advantages of being a homeowner between tax advantages and the ability to find a house you like and customize it, those are so valuable that, you know, I think people shouldn't be afraid to buy houses now.

ROGERS: Christopher Mayer from Columbia Business School, thank you very much for the free advice for Jennifer Westhoven and the rest of us.

Allen.

WASTLER: There's a lot more to come here on IN THE MONEY. Up next pod people. We will tell you about a company that is selling nap space for sleepy workers.

Plus, home is where the help is. Learn how a retiree built a new career by giving low-income seniors a nursing home alternative.

(COMMERCIAL BREAK) WASTLER: It is the day that strikes fear into the hearts of men everywhere. By the way, it is this Wednesday, Valentine's Day. Are you prepared? The growing number of single women in the U.S. may have added to the anti-Valentine's Day crowd. The greeting card companies that rake in the big bucks like me each February have noticed. With us now to figure out how men, women and business can somehow coexist peacefully on this holiday is Patrick Meagher from the Cosmo Radio Channel on Sirius Satellite Radio if you have not caught his show, basically women call him up and ask him for advice on how to deal with men. Because we are so hard to figure out. OK.

ROGERS: You don't like this holiday, do you?

WASTLER: You know -- every Valentine's Day, oh, watch Allen scramble. You have to go out and you got to do this. Flowers and chocolate, Patrick am I covered with that?

PATRICK MEAGHER, COSMO RADIO CHANNEL: Antiquated Allen. Can't do that anymore. Bring flowers and chocolate, you are sleeping in the other bedroom. Trust me. I thought we were getting cocktails out here. Jennifer, what's going on?

WESTHOVEN: I have to work on that next time. Now, so Valentine's Day, though, what -- you got women calling up. I guess they have questions. What's the most common question about Valentine's Day?

MEAGHER: You know, girls, you know, call up and say I already know my man's not going to get me what I want. I think guys have the wrong impression of what Valentine's Day is about. It really should be about celebration of the relationship between two people. Guys use it as a time to - the more money I spend the more it is going to matter. When really what matters is thought in a card and in putting time into it and so girls are always worried about the man just throwing money as opposed to putting thought into it. They really call up and complain quite often on Cosmo Radio about the fact that my man doesn't care because he doesn't put thought into it.

ROGERS: I think we have -- if you actually wrote something in your card as opposed to just, you know, buying a card, I think that that is thought and that would actually mean something.

MEAGHER: Well, card is like hieroglyphics to guys. They don't understand the meaning of a card because it takes time and effort and thought and we are kind of -- it is emotional to write things down for guys and doesn't feel good. What feels good is spending money and coming at them with something bigger and better. Valentine's Day can be a measuring stick for a relationship. You know, a girl can really know where she stands with her man if one year he takes her to Barbados and getting a spa treatment the next year she gets a vacuum, that's a red flag. That's not a good thing.

WASTLER: We mentioned the greeting card companies and are they like sending us -- if I get -- come on Allen. I love you. The card says it all. It is gimmicky.

MEAGHER: You have to use the pen and write what the relationship means. That's what matters, not the card, not the jewelry. not the chocolates, not the flowers. It is what you say and how you prepare for the day.

WASTLER: But we don't open up like that. We are not the opening type.

WESTHOVEN: You can try.

MEAGHER: You got to give it a whirl.

WESTHOVEN: On the subject of spending money though you were saying you know for guys it is easy to spend money. And yet when it comes to cards, it is women that are doing all the buying. Now the card companies are realizing you know, let's not just have cards for romantic. Girls can send cards to their girlfriends. I think it is a path of American women is now without a husband. You could be -- people can send cards to their dad or to their daughters. You know, that's an extra thing, too.

MEAGHER: I think there is a quote Jennifer, or a percentage that 85 percent or 81 percent of the cards that are being bought during Valentine's Day are going to be bought by women and that seems about right. Because guys don't understand the notion of the card, and we don't send cards to our mom, we don't send cards to our dad, we don't send cards to our aunts. We just buy things. That's what makes us feel good. That's what makes us feel good in our own life so we think it will make our girlfriend feel good. It is not about the message; it is about how big the gift is for the guys.

ROGERS: I don't buy cards. I don't really do Valentine's Day. My husband and I don't really do it. When you said the vacuum cleaner -- I thought that was a good idea.

MEAGHER: When you are comfortable in a relationship then you can get rid of the holiday that comes after the holiday.

ROGERS: I'm into the anti Valentine's Day thing. Have you been following this, now the card people are into it now, so here is a card that I'm considering buying? A little picture of a young boy, I think my brother had this haircut a long time ago. The next day little Timmy had his heartbroken. Valentine's Day sucks.

MEAGHER: I'm going to call the girls out on this. The whole anti-Valentine's Day thing. I think girls sit back on Valentine's Day and evaluate. Where am I at? Next year I'm going to have a Valentine. I think guys sit back on Valentine's Day and say I made it one more year. Who will win the Super Bowl next year, it doesn't really matter to them. It is a time for evaluation for girls. I think it is fun to have these, you know, negative comments on the cards but I think girls really do care about Valentine's Day as opposed to guys.

WESTHOVEN: Seeing right into us.

WASTLER: We will see how it works out next Valentine's Day, ladies. Got me all nervous. Patrick Maegher of Sirius Radio the Cosmo Show, thank you so much for joining us. ROGERS: Coming up next, if you think naps are just for babies and preschoolers, consider this. Bill Clinton, Winston Churchill and Thomas Edison all said they like to a good nap. In this week's "What Works," we look at why you might want to consider sleeping on the job.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: It spins open.

ROGERS (voice over): It looks like something out of the future. But it may be an idea whose time has come. A sleeping pod for the office.

ARSHAD CHOWDRY, CEO, METRONAPS: It is an out voted view linking napping to laziness. Nothing can be further from the truth.

ROGERS: Metronaps, CEO Arshad Chowdry believes letting employees take a short snooze actually makes good business sense.

CHOWDRY: Companies will spend millions of dollars upgrading their telephone systems or their software platforms but the productivity increases are very hard to measure. If you let somebody take a 15-minute nap during the day, their productivity can go up by 30 percent.

ROGERS: Dr. Ana Krieger the director of NYU's Sleep Disorder Center says the benefits of napping are well documented.

ANA KRIEGER, NYU SLEEP DISORDER CENTER: People that are sleep deprived tend to first to have decreased performance at work. People that sleep well tend to be happier. They might be able to work better together.

ROGERS: Strawberry Frog, an advertising agency in New York, hopes to foster teamwork and creativity by encouraging employees to doze off.

LLANA BRYANT, STRAWBERRY FROG: In the communications business, we are compensated on the strength of our ideas and innovative thinking. We try to create an environment that produces the best ideas.

ROGERS: Strategy director Adam Devine takes a nap every other day.

ADAM DEVINE: At the time I'm in there, I'll think of an idea, sometimes I even bring a note pad in there.

ROGERS: With the National Sleep Foundation reporting that sleep deprivation costs U.S. businesses at least $18 billion in lost productivity, other companies are taking a closer look at how a little shuteye can help boost the bottom line.

Metro Naps has roughly 100 sleeping pods in use throughout the world. From Procter & Gamble to the Miami Airport. There's already a waiting list for the newest model.

Metro Naps, which rents the pods for $800 a month says business, is stronger in Europe. But that American companies, especially hospitals, worried about sleepy doctors seem to be catching on. If they want to place an order, though, it is best to steer clear of naptime.

CHOWDRY: We you may not reach me at 2:00.

(END VIDEO CLIP)

ROGERS: I tried it out myself and attempted to take a nap, I did not fall asleep. They say that's OK. You don't have to sleep to get the benefits of feeling rested. I was a little bit more rested. They say if you nap at the same time every day, if you went to your pod at 2:00 and napped, yes, perfect, you would fall asleep it takes a little practice, just like everything in life. It would be nice, this little napping pod. I think you get used to it. Lifts your feet up, blood drains out, there's music.

WASTLER: Bad for productivity.

Coming up next on IN THE MONEY, cupid gets a cubicle. With Valentine's Day coming up, see why the workplace romance is nothing to take lightly.

It is time to hear from you as we read some of your e-mails from the past week. You can send us an e-mail right now to, we are at INTHEMONEY@CNN.com.

(COMMERCIAL BREAK)

ROGERS: According to conventional wisdom, office romances are usually a bad idea. It looks like more and more of us are taking the plunge anyway. Polly LaBarre joins us now with a look at just how many of us are doing more than just work at work. That's this week's edition of the number. Now, I mean, I'm a little surprised that the numbers could be so high. How high are they?

POLLY LABARRE: Well they are going up to 47 percent of people reported that they have had office romances. I love this one 11 percent haven't but they are willing to try, 17 percent --

WESTHOVEN: That's a stat I like.

LABARRE: Seventeen percent have been caught, you know mid tryst in the office.

WESTHOVEN: Smooching.

ROGERS: Smooching. That's a lot.

WESTHOVEN: Seventeen percent of percent of the people having?

LABARRE: No 17 percent of the people in the most recent survey report. That's up from 2 percent last year. Blame television, it is the Ally McBeal effect. There are so many shows that are set in the workplace and so much of the action revolves around romantic entanglements. I think it has lifted the taboo. The fact is we spend so much time at work. It is so intense. It is so personal. I mean, it is not a shock that more and more people are finding their mates and their friends at work.

WASTLER: That's something I was thinking about, you know. People say oh, no, you shouldn't do that at work. Managers crack down on that. When you think about it, when you grew up in school, you know, school was where you met people to date and you went through that. Then all of a sudden work which takes up so much of people's lives, you don't have much of an opportunity. It seems natural people would start get interested in each other and fool around. You know, who am I to say?

WESTHOVEN: Why are you looking at me?

LABARRE: The idea it is playing with fire is -- as you said, conventional wisdom, I think that's overwrought. I think the objection is coming from the lawyers and the human resource managers because it makes their job difficult. The other research shows that more than half of all office romances end in marriage or long-term relationships. Actually, it can be a positive thing and really great companies I have seen embrace it rather than shy away from it.

WESTHOVEN: There are some companies that embrace it?

LABARRE: Southwest Airlines has more than a thousand married couples in its ranks. They offer a love award every year to the couple that has the most special contribution and NPR has produced more than 60 marriages over its years. I mean they embrace it. The idea is you are hiring people because of their character, because of their values. Not because of their resume, if you are a great company. So by definition, good people with the same values attract good people with the same values. So they are going to mix it up.

WESTHOVEN: What are some of the bad --

LABARRE: Yes. The gossip is -- that's the fun part. Exhibit a, Monica Lewinsky and Bill Clinton. Right? That seared in all of our imaginations that you don't date the intern. Then Jack Welch and Suzy Wetloffer (ph) entanglement where they -- he was -- she was interviewing him for the Harvard Business Review and they fell in love. But he ended up cheating on his wife and lots of really messy stories came out of that. I think it is this boss subordinate power differential where you get into trouble and where there's so much room for messiness and favoritism and just ethical violations. And that's where it gets ugly.

ROGERS: There are good ones out there, too. Bill and Melinda Gates. They have been married a long time.

WESTHOVEN: Three kids no. Scandal.

ROGERS: We have to mention love as we go into Valentine's Day.

WASTLER: No astronauts.

ROGERS: Yes, no astronauts today. Thank you so much for joining us today, Polly.

LABARRE: Thank you.

WESTHOVEN: The population of senior citizens is set to explode in the coming years as baby boomers start to reach their golden years. Some will have their long-term care needs taken care of but others will not. One woman is fighting to make sure that aging men and women are taken care of. Randy Kay has the story in this week's "Life after Work."

(BEGIN VIDEO CLIP)

CONCHY BRETOS, CEO, MIA CONSULTING: Thee is a large number, close to two million, seniors living in public housing in the United States. And they are the most neglected group of people.

RANDIE KAYE, CNN CORRESPONDENT (voice over): Conchy Bretos has taken on their cause through her Miami based MIA Consulting. Her company runs assistant living programs as part of public housing in seventeen states. This path began in the 1990s as she worked on senior issues for the state of Florida.

BRETOS: How nice.

KAY: Bretos discovered that for many low-income seniors who needed extra help, there was often only one option a nursing home.

BRETOS: Nursing homes have their place. But nursing homes are places for people who are sick. Your life is controlled. They tell you when to get up, when to go to sleep, when to eat, what to eat. You are in a room with five, six people. And that was the only option.

KAY: Bretos left state government after devising a new approach. Her buildings feature individual apartments with additional care as need. And the goal is to get others who manage public housing to follow this motto.

BRETOS: Their mentality has been we provide a roof. What happens under that roof is not our business. We are public housing administrator. Convincing them that yes, those individuals living under your roof are your responsibility. It has been overcome in some ways, not entirely.

KAY: Randy Kay, CNN, NEW YORK:

(END VIDEO CLIP)

WESTHOVEN: Stay here. We will be right back with more IN THE MONEY.

(COMMERCIAL BREAK)

WASTLER: Now it is time to read your answers to our questions about whether you are a victim of conspicuous consumption or if you are beating the urge to spend. By the way just about every one of you claims to be winning that battle.

WESTHOVEN: If you are losing, you are not going to write in.

WASTLER: Steven says the key is a healthy mental attitude. He says, "My number one tool is self esteem. My family and I know that the latest and greatest item won't make us better people and we don't care what other people think. Anyone who likes you for your car or your house isn't really your friend."

ROGERS: Mary in Fredericksburg, Virginia, uses good old anger to keep herself in check, she writes, "The urge to buy is not as big as my urge to 'stick it' to big stores like Wal-Mart. And when I heard that Apple wants me to buy a new iPod every 18 months, I decided to ratchet down my desire to buy anything electronic."

WESTHOVEN: That's great. She's watching the show. Gerald just uses common sense. He says, "I exercise fiscal restraint and if I don't have the money to buy it, I figure I don't need it. Obviously, I will never be elected to Congress."

All right. Now for next weeks email question of the week, "Do you think your race or physical appearance has played any role in your position at work or your salary?" We would really like to hear from you on that topic. Send your answers to INTHEMONEY@CNN.com.

And visit our show page at CNN.com/inthemoney. Thank you so much for joining us for this edition of IN THE MONEY. We also want to thank Allen Wastler from MONEY.com and our Jen Rogers.

We will see you here next week Saturday at 1:00, Sunday at 3:00. See you then.

(COMMERCIAL BREAK)

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.voxant.com

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