Apple Hires For iWatch Production

Rick Newman analyzes the morning business headlines.
10:11 | 07/15/13

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Transcript for Apple Hires For iWatch Production
Your latest in business -- -- -- You know a -- and -- remember. Day Monday July 15 never went down -- New York futures up today's markets overseas. Climbed the Dow the S&P 500 now climbing into new territory as they hit their all time highs last week. Ought to bring in Rick Newman from Yahoo! finance -- on top headlines this Monday morning -- over the weekend. Yeah warm -- -- hit it is a little toasty here in the northeast are as -- some new sales data this morning what are the numbers showing us. While the retail sales numbers came out today they were a little weaker than expected. Car sales are still pretty strong people are buying cars taking advantage of low -- low interest rates on. On cars but consumers pull back on and on lots of other things. It's not a terrible report but it just shows us that. You can't really say all systems are go just yet on the economy consumers are still feeling. A little bit jittery and they spent a little bit look less money last month so this means. The Federal Reserve is gonna look at this and say. You know it's not too hot not too cold -- it might be it might be one more factor that falls on the side of let's continue the easing program rather than start pulling it back. It doesn't seem like the markets are gonna reacting strongly to it -- to fairly tepid report but obviously worth paying attention to him is June typically pull back time or -- us. Canada and now balancing -- these numbers are usually seasonally adjusted which means they account for all kinds of seasonal factors. I think you June is probably a strong time for gasoline sales for example people go on vacation. Car sales are pretty good in the summer so did not necessarily but this is all this is all sort of smoothed out to take account of those kinds of variations. All right well you know one of the things actually -- talk about gas prices and all present just a minute. Our earnings season those obviously underwent investors -- -- the united -- how companies are doing -- today or watching today. Yes Citigroup turned in a real nice profit -- above analysts' expectations. That's that's not that surprising because the financial industry has been doing terrific. We've seen strong earnings so far from JPMorgan Chase and from Wells Fargo. Banks -- back basically that's that that party economy has been repaired obviously they've benefited from all kinds of help. From the Federal Reserve when stock market is going up that's great for banks Citigroup did reports. Higher income from -- from my trading for instance. So that life is pretty good for the banks these days it's what we need is for that for that to trickle through to the rest of the economy and that's what's taking so long. And I want to ask you about that -- play it out where's all that revenue and ago. Well it's gonna go to shareholders for starters. But that doesn't benefit from most ordinary people over time. And we are seeing this happen. As banks find themselves in better condition. They will ease up on lending standards that has been happening it's just happening extremely slowly. But -- that is one factor for instance that's contributing to. Better car sales because. People -- have sub prime credit for instance have been able to get car loans. That is less the case with housing. Banks are obviously very reluctant to repeat the mistakes that got them -- so much trouble started around 20062007. So -- this is just gonna take a long time to trickle back into the real economy. If you -- I wanna go to China for a minute talk about the economy there because it has slowed. -- a little bit from seven point seven growth to a seven point 5% growth and investors hurt someone happy about those numbers. China's economy is -- -- totally different scale from our timing was so when you hear seven point 5% growth and that's sound like a slowdown you think what kind of parallel universe in my living and -- well that the parallel universe is. China is a huge emerging economies still they got a lot of people who -- migrating from. Rural areas to cities and they need jobs so that some point 5% growth is no accident the Chinese Government knows it has to have policies. To keep growth that high -- so they can provide jobs for everybody. Who wants one and when we see China slowing down that's -- kind of a -- -- points on one hand. That means there could be some problems in China that could that could spread to the rest the -- I don't think I don't think it should at that point yet. But China needs to become a normal economy a normal developed economy and it's you know midway through that process so. If we can see China continuing for instance two if living standards continue improve there. Even as it drops down -- -- China's growth rate was something like 14% just a few years ago I mean I think that was the peak in 2007. So if growth can come back to something it's normal when -- in need in a developed economies such as 56%. Even 4%. And yet they can still provide jobs and living standards. That's good news because it shows -- Chinese economy is sort of stabilizing at a higher level. We're still far away from that and there are some problems in China that are worth watching they could have. They have -- -- they do have some big credit bubbles there for for one thing. The question is whether the government there will be able to manage its way out of that so far more or less it has but yet doesn't mean that we'll continue in the future. One of the company's it's always interest insists it's a study and examine as apple and they are on a bit of -- hiring spree right now right. What's driving I have -- we we have endless fascination with everything happening at apple so the latest news the Financial Times had a story this morning. About how they're on a hiring spree to staff up development of the I watch. This is this is one of them most. Watched products that hasn't actually appeared yet I think. I could be more than a year before we actually see and I watch but this is. This is a you know like the computing device you're gonna Wear your watch selected Dick Tracy comic strips from 25 for thirty years ago. We don't know exactly what's what it's going to be supposedly. They've run into some development challenges there. Trying to get all the computing power they want any user friendly way on your wrist. I don't know he needs to be waterproof safety can jump in the pool with it and take a shower with that like other watches. But they're hiring -- apparently -- help get that product development. Google search as yours swan diving although they probably from critical but hey it was -- -- we -- -- -- oil and gas at the top of it. This is a bit of a conundrum because oil prices have shot up gas prices though -- down three cents an average. Explain -- of this. Inverse relationship. We'll just -- Will follow oil prices up but there's big east to two things do not move in tandem as much as they used to perhaps. -- oil is a big part of gasoline prices but there are other factors too. One factor is refining capacity here in United States you have to. Refine oil into gasoline. And that process sometimes sometimes there that processes that capacity is completely -- also those refineries and a 100% that tends to push prices gas prices up. Sometimes more than oil prices. And other times. -- the supply of gasoline. Is better than the supply of oil coming in and I think that may be -- case now but -- -- going to -- probably going to see oil prices excuse me gas prices follow oil prices. Up that -- is that isn't necessarily going to last -- waste oil prices have gone up because of concerns over stability in Egypt which is where the Suez Canal is a lot of oil travels through there. There's no evidence that there's any danger to oil shipments through the Suez Canal so there's reason to think oil prices may drift back down. By by that point gas prices may have spiked. And then they'll take a longer time to come down an oil prices but maybe by the end of the summer Woolsey about the that is coming down keep fingers crossed double those are -- is -- -- it is Monday. On each uninterested in this in the trial of this Goldman Sachs trader fabulous fab. Moret. This is an interesting window into. What exactly went on at these banks. That contributed in some people say caused the the big thing that -- financial meltdown that happened in 2008 we're gonna hear a lot about internal emails. And make it sound as if this traitor he was only 28 years old at the time. That'll make it sound as if this trader knew he was selling securities sees are these are very complex securities linked to the housing market. The internal emails make it sound as if he knew these securities were likely to collapse sold them anyway and we're gonna hear his defense say. Look this is the way it happens on Wall Street and the buyers were not mom and pop. People putting you know its spending their life savings on these things these are sophisticated. Institutional buyers they knew what was in here and they were just making a -- And you know every trade like that is -- -- somebody's buying and somebody selling. What's in this is not going to be very satisfying. One way or another in terms of people feeling like they're gonna get justice for the financial meltdown this guy was a mid level trader. The SEC has already settled with his former employer Goldman Sachs. Importantly. Virtually no high ranking people have been prosecuted or gone to jail over the financial scandal -- what the government has -- -- going after one mid level guy. Yeah I'm I mean at first blush it looks -- walking -- very technical but at the same time when you look at the billions that were involved with that everyone. Whatever their stake might be as some kind of an interest -- on this. -- idea -- Prague a colorful trial -- I have a feeling the prosecutors are gonna want to trot out you know some lifestyle details how. How this guy live -- obviously lived -- we've already seen. The defense that guy's defense. You know trying to paint him as a sympathetic guy there is a story in the New York Times yesterday about how he. Went to rewind for some time in helped helped. -- the villagers there and what a great guy he actually is. It'll be colorful nothing. -- made the least while Leslie -- without -- -- minutes ago the Dow is up about three points at 15100468. Regular from Yahoo! finance Rick have a great Monday. -- --

This transcript has been automatically generated and may not be 100% accurate.

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