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CNN IN THE MONEY
President Bush Tries To Sell Illegal Immigration Plan; Can Domestic Car Companies Be Saved?; Goldman Sachs Gives Big Bonuses; Overly Competitive Executives; Sillerman Paid $100 Million Plus For Elvis Stake; Living On The Edge After Retirement; EBay Has Enjoyed A Good Shopping Season So Far
Aired December 3, 2005 - 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: Hello, I'm Fredricka Whitfield in Atlanta. You're looking at live pictures out of Atlanta, Georgia, where New Orleans Mayor Ray Nagin is addressing members at a Town Hall meeting. He'll addressing the evacuees from New Orleans who are now living temporarily in Georgia.
Just moments ago, he promised that no one will bulldoze their homes without their permission, but in moments, after he finishing his comments, he'll be opening up the mic to hear questions from those in attendance.
Meanwhile, Pakistani officials say a major al Qaeda operative has been killed in an explosion. Pakistan's Information Ministry said Abu Hamza Rabia died Wednesday while working with explosives in a home near the Afghan border. The Pakistani officials deny reports that he was killed in a missile strike.
In Iraq, 11 Iraqi soldiers are dead following an ambush by insurgents late this morning in the Diyala Province. The violence comes two days after a roadside bomb killed ten U.S. marines in less than two weeks before Iraq's parliamentary elections.
Outside Tampa, Florida, look close and see how a Wal-Mart security camera captured a modern day Grinch snatching a Salvation Army kettle. Police believe the suspect stole from the same stand two days before. The Salvation Army is now locking down the donation kettles.
Those are the headlines. I'm Fredricka Whitfield. More news as it happens. IN THE MONEY begins right now.
JACK CAFFERTY, CNN ANCHOR: Welcome to IN THE MONEY. I'm Jack Cafferty. Coming up on today's program, turning the tide, or trying. We will look at President Bush's plan for dealing with illegal immigrants and see what America would be like if we didn't have them.
Plus a look under the hood with General Motors and Ford both in trouble, let's find out what it would take to save these landmark American brands.
And selling Elvis some more. The guy has been dead for decades. Meet the mogul who wants to transform the late king of rock and roll from more than a music maker to a money-spinner. Joining me today a couple of IN THE MONEY veterans, CNN correspondent Susan Lisovicz and "Fortune" Magazine editor at large Andy Serwer.
So the jobs report is out on Friday, came in roughly in line with expectations, a couple hundred thousand new jobs, unemployment rate holding at five percent, we had a good GDP report earlier in the week. The economy seems to be on track to kind of mumble and bumble along.
ANDY SERWER, "FORTUNE" MAGAZINE, EDITOR AT LARGE: I think what happened is despite the hurricanes and that mini oil shock we had, we do continue to move on ahead. There's not a lot to complain about. It's going to be interesting to see, I think, in the 2006 election if the Democrats have any traction there. I don't think they probably will.
SUSAN LISOVICZ, CNN ANCHOR: You know, in fact economists were saying if we didn't have the oil shock and the couple of hurricanes, the GDP could have been 4.6 or 4.7 percent.
SERWER: Like this program. Out of control.
LISOVICZ: The president has had a tough week with immigration, with Iraq. He was quick to get out in front of the White House and hold a mini press conference and say the economy is in good shape.
CAFFERTY: However, there's a dark lining around that silver cloud, which is the Fed. The GDP numbers, strong employment numbers that means they have a green light to keep hiking rates.
LISOVICZ: Alan Greenspan was speaking almost at the same time talking about deficits and out of control spending.
SERWER: Come on. The glass is half full.
CAFFERTY: President Bush this week tried to sell America on his plan for dealing with illegal immigration. He's promising tougher border protection and enforcement and a guest worker program. The message seems to be the White House isn't going to go soft on the illegals. If you buy the headline. If you look deeper, maybe the president is trying to have it both ways. Business isn't going to lose its source of cheap labor either.
The president's speech got us to wondering what the country might look like without all the illegal help. From Washington, D.C., Mark Krikorian is going to give us some perspective on that. he is the executive director of the Center for Immigration Studies which describes itself as a nonprofit, nonpartisan group. Mark, nice to have you with us.
MARK KRIKORIAN, CENTER FOR IMMIGRATION STUDIES: Thanks for having me.
CAFFERTY: Is that an unfair way to characterize the president's speech, trying to have it both ways on the subject of illegal immigration? KRIKORIAN: No, not at all really. He didn't say anything substantively different. I mean really the way to describe the speech, if I can paraphrase Mary Poppins, is a spoonful of enforcement helps the amnesty go down. It was an attempt to seeing he was pro- enforcement but in fact it was just an attempt to sell his illegal alien amnesty and guest worker program.
LISOVICZ: For you, that's the crux of your criticism, right? It is the temporary guest worker program. They're permanent. Let's face it. They're not going away. They have jobs and they have families. They will stay here. You think that's just a de facto amnesty program.
KRIKORIAN: Exactly. That's the question. Not so much are we going to make these people go back if they come in through a temporary program, because we're not. The question is, should we be importing foreign labor and what do we do with the 11 million illegal whose are here and not set up some system where we keep going the way we're going now. We just label the illegals with a different label.
SERWER: Mark, I'm going to ask you a theoretical thing. I know it's wrong and bad these people sneak into the country. But what's wrong with illegal workers? How are they hurting us? What's going on here? There's a 5 percent unemployment rate. There's permanent help wanted signs all over the place. What's the problem?
KRIKORIAN: Well there is a couple of things. First of all, let's just quickly touch on the effect on taxpayers. The idea that you can import huge numbers of low-skilled people into a modern society and not create enormous burdens on taxpayers is a fantasy.
SERWER: But what are the burdens?
KRIKORIAN: Let's start with schools. Illegal aliens aren't just labor inputs. They're people. They have families. Sometimes they have kids here who are U.S. citizens. Those kids have to be educated. Illegal aliens are very poorly educated and, therefore, they earn little money and they work in jobs that don't pay health insurance.
They put enormous strain on social welfare systems on public hospitals, on other kinds of social services like that. There's no way that their tax payments can even come close to covering that cost, not because there's anything wrong with them but because they are a mismatch with a modern economy. They're 19th century immigrants even today who are being imported into a 21st century economy.
CAFFERTY: Can you address the political hypocrisy of all of this a little bit? I mean there is no border enforcement. We have 11 million illegal people in this country and they come across the border every day by the hundreds, thousands. Who knows how many. The businesses and corporations in this country hire them to do all sorts of things, which add to the corporate bottom line. The taxpayer gets stuck with the tab for education, healthcare, et cetera.
The corporations get the profits that they can realize from hiring somebody for $4.00 an hour that would cost them $9.00 an hour here in the United States. I mean this whole thing is a joke. The taxpayers are being fed a big line, at least where I sit and view this thing.
KRIKORIAN: Well essentially it is like any other subsidy. Illegal immigration is like another subsidy where the business that benefits from the subsidy pockets the profit and the public at large is the one that ends up paying the cost. The reason it continues that way is because those who benefit, not just businesses, but, also, the immigration lawyers and the ethnic pressure groups and others, they benefit a lot.
So they are very active in lobbying to keep the things the way they are. The public that pays a price is more diffuse. No lobby for the generic tax payer and so we end up with this kind of situation continuing until people get fed up enough to demand change.
LISOVICZ: Right Mark so really the solution isn't really more fences or more enforcement on the border. It is really enforcement over the businesses who hire illegal aliens. The president said in the past few days he would crack down on that. Do you believe it? Is that the solution?
KRIKORIAN: He didn't say he would crack down. He just mentioned enforcement of the immigration laws inside the country. But your basic point is right. Border enforcement is important. We've actually put a lot of resources into that even though it's still inadequate. Where we really are lacking is in giving businesses a useful, accurate way of knowing who's legal and who's not.
It is a question of enabling them to comply with the law so that all the businesses can operate on an even playing field. The way it is now we have this online system where participants can verify new hires. Are the Social Security numbers real or fake? We use it but it's voluntary. So legitimate businesses can use it. Crooked ones avoid it and they benefit because of that.
SERWER: But Mark, I know this is going to sound strange again. But don't illegal immigrants provide more benefits to society than they take away? I mean, who's going to do all the yard work? Who's going to do the dishes? Who's going to pick the fruits and vegetables? I don't understand. These people aren't here anymore. What happens to the economy then?
KRIKORIAN: I mean I think that's one of the basic questions you've touched on. One way to think of it is well, what if they disappeared tomorrow. There was a ridiculous movie called "A Day Without a Mexican" with that premise. But the fact is they are not all going to disappear tomorrow, it took a long time for this illegal population to grow and be incorporated into the economy and we start enforcing the law, it will be a process, not an event, of reducing the illegal population.
And I read in Adam Smith what happens. What happens is, employers will offer more money and better benefits to attract the legal worker that is are still here, and, at the same time, look for ways of eliminating some of these labor intensive jobs that only existed because there were illegals to do them. In other words, reorganizing the work differently so you will end up with a smaller number of low-skilled workers who are more productive and earn more money.
CAFFERTY: Mark Krikorian, executive director of the Center for Immigrations Studies. Enlightening stuff. Thank you for sharing your thoughts with us.
KRIKORIAN: Thanks for having me.
CAFFERTY: Nice to have you on the program. When we come back on IN THE MONEY, tuning up GM. Now there's an assignment. See what it would take to get one of America's best-known businesses back in shape.
Plus conquer and divide. As they divvy up the take at Goldman Sachs, and wait until you hear the size of the pot they are fooling with there. We'll look how the Wall Street bonus system actually works. It makes my paycheck and yours look puny.
And race you to the corner office. Find out what happens when corporate executives take competition to extremes. They become bona fide nut cases. We'll give you some examples.
CAFFERTY: Half a century ago, hasn't been that long if you're my age, General Motors had a whopping 50 percent of the U.S. car market. Cut to last week when the company announced it's going to wipe out 30,000 manufacturing jobs, close a bunch of plants and that may be the beginning. There is no question General Motors is in big trouble. So is Ford.
In fact, on Friday the "Wall Street Journal" published a piece and said that Ford is planning to shut a couple plants and eliminate additional thousands of jobs. The question then is, what is it going to take to fix these companies? Are they even fixable? One possible strategy, think less like Detroit, think more like Las Vegas. For a look at how to salvage General Motors and Ford we're joined by Jim Matheson, who is an associate professor in management science at Stanford University. Jim nice to have you with us.
JIM MATHESON, PROFESSOR, STANFORD UNIVERSITY: Thank you.
CAFFERTY: Can General Motors be saved? Lets start with thee big question, is this company 20 years from now even going to exist?
MATHESON: Well that is a very good question. I don't know if I'd give you even odds on that. What they're doing, people regard the cost cutting they're doing as strategy, which really it's not. It is a symptom of what's wrong with both General Motors and Ford. They have gotten into the mode of cost based management. They've been in it for years. They will not do things that are costly. So they refuse to innovate. They need to switch from -- go ahead.
SERWER: I just want to ask, I'm sorry to interrupt. Why now, though? We had this huge problem back in the 1970s; the price of gas went up, Japanese made small cars. But Detroit seemed to respond and they sort of had a two-decade period where things were going OK. There were a lot of ups and downs. Now all of a sudden we've hit a crisis. We know about healthcare costs. Have they just lost their way in terms of making cars that people want? What's going on right now?
MATHESON: Yes, I think they have lost their way. They don't know how to manage for value. They manage for cost. Let me give you an example of what I call cost-based management. Let's take innovation, which is their biggest problem.
Let's say you want to have innovative cars, maybe it takes a decade or so to get them out there and it's going to underpin the value of your company for several decades after that. What you need to do is have a portfolio of innovations, of trying many different things.
You need to put good teams of people on all these innovations and, say, you're doing 20 different things. You have to assume half to three-quarters will fail. You have to take the risk of failure and the people that try the things that fail has to be rewarded for doing a good job of trying. It's not those people that have failed. It's those areas of innovation didn't work out. You are left with --
LISOVICZ: All right. You're -- excuse me. You're talking about, professor, about the creative side. That's a huge problem. In the meantime, GM is buckling under the weight of its healthcare, the UAW, the perks that its workers have come to enjoy over the decades. If more aggressively cuts jobs, that would swell the ranks of the retirees with those fantastic benefits. It's a catch-22. Isn't Chapter 11 really the only solution for GM to really streamline itself?
MATHESON: Well, I wouldn't be surprised. I'm not an expert on bankruptcy and its used as a tool. Even that is just a tactic. If -- we had an earthquake here. The Loma Crater earthquake. Some were caught in the rubble. Say their leg was caught. You need to get them out.
Their leg was amputated. That amputation was emergency medicine. It wasn't strategy. They had a strategy of how to put their life back together again. Even if they go through bankruptcy, it's still part of the emergency medicine for GM and Ford. The question is, can they rise from that as a viable company?
That is going to depend on their ability to innovate. What I was starting to say is they have to play a portfolio of innovations. Would you invest your life savings in one stock and, you know, pick a stock, put it in, and then a decade later say, gee, that stock didn't win. I guess I lost. Well, that's what GM has said about the hybrid vehicle. They had people working on hybrid vehicles. I had their students here 30 years ago planning various hybrid cars.
At some point GM said we're going to pick the winner. It's going to be the hydrogen fuel cell vehicle. So they pretty much shut down their hybrid work, bet on the huge cell vehicle, which was also convenient because it didn't require introducing anything soon. And then low and behold the hybrid autos came into being as the market winner. They didn't have an entree and now they're saying, gee, I guess we didn't pick the winner.
SERWER: Jim Matheson, management professor at Stanford University out there in California. Thank you very much for coming on the program.
MATHESON: You're welcome.
SERWER: Coming up after the break a little something extra. There's plenty of cash in the bonus pool at Goldman Sachs. Find out how they spread it around.
Also ahead shake your moneymaker. We'll talk with an entrepreneur who thinks Elvis can still bring in the big bucks.
And Uncle George wants you. Find out why on our "Fun Site of the Week."
LISOVICZ: Now lets take a look at the weeks top stories in our "Money Minute." Wall Street spent the week obsessing over tons of sometimes contradictory economic reports. Weaker existing home sales numbers spurred a sell off early in the week. But strong spending and manufacturing reports pushed stocks higher later in the week. Big- time investors seem most impressed that inflation stayed in check despite gains in personal income and personal spending.
Maybe we should start calling the blue states the green states. According to the government the states with the highest wage earners in 2004 were all in the northeast with Connecticut, New Jersey and Maryland being the top three. Connecticut's nation leading medium income $56,409. Louisiana, Montana, and Mississippi were on the bottom of the salary list.
But Montana is leading the way in another category. The state government there is paying county workers and their familiars to lose weight. The idea is to cut medical costs. County workers want to cash in must have pre-set weight goals and keep the extra pounds off for at least six weeks.
SERWER: Jack, and Susan, what kind of holiday bonus are you expecting this year? Well, chances are it won't be anything like the goodies some Goldman Sachs employees will bring home this time around. Goldman has already announced it's setting aside between $9 billion and $10 billion in bonus money for its 20,000 workers.
That is about $450,000 per employee. Of course, the actual payouts will vary greatly with some getting very little and some getting $20 million or more. Goldman Sachs is enjoying a great second half of 2005, with almost a straight shot up since June. Bonus, baby, Goldman Sachs is our stock of the week. This is my take on the whole thing. Wall Street is a casino and Goldman Sachs is the house. Wall Street is different than any other job in America. People who work at Nike want to make sneakers and they want to get rich. People work at Procter & Gamble want to make soap and they want to get rich. People on Wall Street only want to get rich. People at Goldman Sachs just want to make money. That's the line business. Part of how they get paid is their stock. So, you know, that's why I think that stock is probably an interesting thing to consider.
LISOVICZ: You know what I don't understand is, OK. Fantastic they're making this money. What kind of year has it been on Wall Street? We've had a terrific month. But for the year, what's the S&P up three percent, what is NASDAQ up 2.5 percent, what is the Dow up 1 percent. How do they justify making all that money? Have IPOs been barn burning it? I don't think so; I don't think it's been that great a year on Wall Street.
CAFFERTY: Where does the money come if it doesn't come from the stock market?
SERWER: One thing you're forgetting about this year on Wall Street, it has been very volatile. Volatility is everything on Wall Street.
LISOVICZ: Good point.
SERWER: The traders love it and Goldman Sachs is nothing but a trading house. In fact, some people suggest it's one big giant hedge fund. More on trading revenues, oil traders, currency traders, derivative traders. These people have been making billions of dollars at Goldman Sachs.
CAFFERTY: Playing the short swings in the market.
SERWER: Just going back and forth. If the Dow is up 3 percent, it doesn't matter as long as it's gone all over the place. A lot of sectors like energy and healthcare, GM, all those stocks and those are just stocks. Never mind a lot of different crazy derivatives have been very, very volatile. It works.
LISOVICZ: And also deals. Of course you know underwriting is huge for them. What's one of the biggest deals that is going to end it? The New York Stock Exchange going public. Goldman Sachs is on both sides of that with the New York Stock Exchange and with Archipelago. I mean it is going to make money there.
SERWER: This stock a lot of people have been saying it hasn't really gone up that much. Actually it has, it has gone up 75 percent since it went public in 1999 while the market was flat. It is also pretty inexpensive. I mean it is only sells for 12 or 13 times earnings. Again, there's a huge amount of risk here. You get something like long-term Capital, even Revco, which are these Wall Street scandals and this could take a big hit. So far they've been good.
LISOVICZ: $130 a share. Close to the all-time highs in the past five years.
CAFFERTY: That is it.
All right. Coming up on IN THE MONEY is the rat race driving you crazy? If so, it could be because the boss is unhinged himself.
Plus Elvis left the building almost 30 years ago. There's a new man in charge of the Elvis business. We'll see if his plan to boost profits is too much conversation and not enough action. Thank you very much.
And why was eBay a big winner this week? Web master Allen Wastler will have the answer a little later on.
WHITFIELD: Hello. I'm Fredricka Whitfield. IN THE MONEY continues in a moment. But first a check of the headlines now in the news.
We've been hearing all week about the face plant story. Well now here are the images of the world's first partial face transplant. Doctors in France have grafted a nose, lips and chin onto the face of a 38-year-old woman who had been mauled by her own dog. And now the first images being published.
New Orleans Mayor Ray Nagin is taking questions from Hurricane Katrina evacuees at a town hall meeting taking place in Atlanta; he's getting an earful. At the same time he is urging the evacuees to come back to the city and he is talking to them about recovery and rebuilding efforts in the aftermath of the devastating storm.
Al Qaeda has lost one of its top leaders. The Pakistani government says Abu Hamza Rabia died Wednesday in a blast while working with explosives in a rural part of northern Pakistan. But Pakistani officials are denying reports that the blast was the result of a CIA missile strike.
I will have all the day's news at the top of the hour. Back to more IN THE MONEY.
LISOVICZ: The competitive urge is what separates major corporations from all the mom and pops out there. But executives can go overboard with the competition thing. When they do, their companies may flame out right along with them. In fact, according to an article in the "L.A. Times" this week, some researchers think hyper competitiveness could be a mental disorder.
For more about bosses whose take competition too far we're joined by Barbara Kellerman, of Harvard University's Kennedy School of Government. She is the author of "Bad Leadership, What It Is, How It Happens, and Why It Matters." Welcome.
BARBARA KELLERMAN, HARVARD UNIVERSITY'S KENNEDY SCHOOL: Thank you, Susan.
LISOVICZ: You say at the core of every corporate meltdown is a hyper competitive CEO. That's essentially why they get paid the big bucks, the shareholders expect it. Winning is everything, as in sports.
KELLERMAN: Well, it's absolutely true to say that a leader of any institution, any corporation, whether political sector or private sector, doesn't get to the top without being intensely competitive. As you're suggesting, that kind of competitive drive is absolutely key to winning and winning a leadership role, especially if you're at the top of the heap all together is not an easy thing to do.
But what I do claim, and I'm not a psychologist. I'm a political scientist. But I've studied leaders for many, many years. What I do claim is that when the hunger for more, when the competitive drive gets to the extreme so that greed and -- whether it's greed for money or greed for power becomes excessive, then both the individual and the institution are likely to run into trouble.
SERWER: Barbara, I had one of these bosses, sort of indirect boss, one time. He would take us to strategic off sites where he would divide up the company into different groups and we'd have drinking games versus each other and we'd go out and run. It was ridiculous. The guy fortunately got canned at some point. I'm wondering, could you really have a boss who's mellow and be successful? Does that work?
KELLERMAN: Well, I should ask you if the drinking games worked. But that's another conversation.
CAFFERTY: Just look at him.
KELLERMAN: As I suggested earlier, there's no way that excessive mellow works in virtually every single leadership role. It's very hard work and requires incredible perseverance and it requires incredible resistance to slings and arrows of all kinds. The drive to win, the drive to succeed, the drive for another notch in the belt, that's really very powerful, but the well-balanced leader, the healthy leader has some sense of when enough is enough.
Some sense of when competition becomes competition only for its own sake and, indeed, unhealthy in every aspect. So the smart executive, as well as the mentally and physically healthy executive, will know when to be reasonably tempered and moderate in the drive that we're all talking about.
CAFFERTY: They asked Rockefeller one time how much money was enough. His answer was always just a little bit more. I'm not suggesting Mr. Rockefeller qualifies as a hyper competitive anything. I do want some names of some of the corporate whack jobs out there and what, in your opinion, qualifies them as head cases.
KELLERMAN: I wrote this book called "Bad Leadership." I said many bad things about many different people. I don't know that I used the phrase "whack job." CAFFERTY: No. That's my word. I've worked in enough television stations in 40 years to know what whack jobs are. In this industry they're everywhere.
KELLERMAN: I will describe that to you, Jack. We do have many examples. One of the most legendary and I go into some detail in my book is that of Al Dunlap the former head of Sunbeam.
LISOVICZ: Rambo in pinstripes.
CAFFERTY: Chainsaw Al.
KELLERMAN: Exactly, chainsaw Al, Rambo in pinstripes. Who was notoriously driven and driven to the point of excess, not understanding when enough is enough, brutal to those he worked with, including his closest aides and eventually resulted in a flameout. The other kinds of people we say are the people for whom competition is counted in numbers and salaries that are excessive, so excessive the hunger for money that they end up in jail, whether that's Bernie Ebbers or Dennis Kozlowski.
All those people are competitive to the point of self- destructing. You compare them with other legendary executives, Jack Welch being an obvious example, and you realize it is continuing with some people do having some kind of internal compass that says enough is enough and be careful.
LISOVICZ: But you know it is almost to easy just to point to the criminal behavior because they are, in fact, in most cases thankfully going to pay for their crimes. Jack Welch by the way was called neutron Jack at one point in his career because he was terminating so many people. I would think Barbara that there is a lot of CEOs who operate in a gray area.
Take the CEO of Wal-Mart for instance, Lee Scott. Critics say paying way too low for the nation's largest private employer, importing way too much stuff from China, basically outsourcing has become much faster because of Wal-Mart. What would you say, how would you say Mr. Scott fits in with your hyper competitive CEOs?
KELLERMAN: Well so long as someone is able to claim success without ending up in jail and will be known in time as one of the all- time great executives, then you can say competition, inevitably, is destructive to some of the people some of the time. We're dealing with a capitalist economy here.
The final measure is the bottom line. If the company survives and thrives and everybody stays out of jail, you have to say the competitive drive within our system, within our culture is healthy. No one can complain. No one does complain in the United States with success.
LISOVICZ: We'll leave it at that. Barbara Kellerman author of "Bad Leadership." thank you so much for joining us.
KELLERMAN: Thank you. LISOVICZ: And there are lots more to come here on IN THE MONEY. Up next love him tender as in legal tender. We'll hear about the media prospector who is betting that the king is still a huge moneymaker.
And sign on the dotted line. We'll show you one take on what George Bush would say if he wanted to convince you to get over to Iraq. Our "Fun Site of the Week" is just ahead.
SERWER: Not everyone would want the rights to a product that has been literally dead for almost 30 years. But Robert Sillerman recently paid $100 million plus to Lisa Marie Presley for a controlling stake in Elvis Presley Enterprises. The deal gives Sillerman the rights to use Presley's name and likeness. Bob Sillerman is the subject of an article I wrote for the currant edition of "Fortune." He joins us now to explain why he believes so strongly in the future of the king. Bob welcome to the program.
ROBERT SILLERMAN, ELVIS PRESLEY ENTERPRISES: Nice to see you Andy.
SERWER: So why don't you explain what you see in Elvis. Obviously he is popular now. Won't he become less popular going forward? How do you plan to take him nationally and make him more popular?
SILLERMAN: Elvis has only been available to his legion of fans around the world, either through his music or at his home in Graceland. He is symbolic of the beginning of the most important cultural event of the second half of the 20th century.
The advent of rock and roll. John Lennon said it best. Before there was Elvis, there was nothing. Without Elvis, there would be nothing. I suspect that as long as we are playing rock & roll and as long as kids are listening to music, that they're going to discover Elvis anew.
LISOVICZ: You know Bob; first of all, I have made the pilgrimage to Graceland a couple times. That's of course one of your hot properties.
SILLERMAN: Hot property.
LISOVICZ: Literally, you know, when you think about Elvis, you think about the furniture, the clothes, the life lifestyle. Even the food he ate. Everything was so over the top. Almost like not easy to offend anyone with how you market him. I mean, I remember my roommate in Atlanta had a vial of Elvis sweat. We thought that made a lot of sense. I mean what kind of things --
CAFFERTY: What kind of college did you go to?
LISOVICZ: That is a little different, Susan.
LISOVICZ: He sweat a lot when he was performing. I believed that it was genuine Elvis sweat. My point is --
SILLERMAN: We could have it tested for DNA.
SERWER: There you go. Thank you, Bob.
LISOVICZ: There you go, I rest my case. What kind of things are you thinking about in marketing Elvis?
SILLERMAN: Well, the king did invent living large. There's no question about that. As you say, when you make the pilgrimage to Graceland you understand exactly why he was the king. We have in our possession over, listen to this, over 600,000 artifacts that are Elvis's' that go from the jumpsuits and the clothing to cars and things he touched, his records, et cetera. It is our plan, tastefully but forcefully, to create a 21st century experience for people to get in contact with the king but in places other than Memphis.
Obviously, number one on our hit list, so to speak, is Las Vegas where we're working aggressively and have narrowed down to three possible choices a place for not a replica of Graceland because there really is truly only one Graceland but for something that will give visitors the feeling of Graceland but will also get them in touch with the king the way you're able to do with 21st century technology.
CAFFERTY: Talk to us a little about the economics of this deal you put together. We reported you paid $100 million to Priscilla Presley for the rights to market.
SILLERMAN: That's correct.
CAFFERTY: To market him. The estate has been kicking out about $40 million a year. Which is not bad for a guy who is dead almost 30 years. You have a hundred million you put in for a thing that already has a $40 million a year cash flow. Sounds to me like you made yourself a pretty good deal.
SILLERMAN: Well it would if it were $40 million cash flow. It is a little more than $45 million in revenue. Its cash flow is about $12 million. We still think that as an under marketed asset, as Lisa Marie said in Andy's article, an asset that a family couldn't exploit to its full benefit, that we did make a terrific deal.
And we do have the resources to take Elvis overseas to places where he never toured and where there's a huge appetite for him and also to Las Vegas and, by the way, Graceland sits on a little bit over 13 acres in Memphis. We own 80 acres so that it's probable in the near future we'll announce some plans to bring more Elvis type experiences to the area surrounding the mansion as well.
SERWER: I like the idea of Elvis-type experiences. I think I want to experience some of those experiences, Bob.
CAFFERTY: You may.
SILLERMAN: Didn't I say to you the world was under Elvis?
SERWER: You did. Let me ask you about another property that you own that's very exciting and that is something that people know a lot about. Which is "American Idol" you also own that television show and that franchise. Very popular now, been just has been re-upped with a network that will go nameless. Isn't that going to run out of steam at some point? These TV shows fade out of popularity, Bob.
SILLERMAN: Well, apparently the unnamed network, Fox, decided that ...
CAFFERTY: That's the "f" word network.
SILLERMAN: It is the "f" word. That is right. Doesn't think so. What they did I believe is unprecedented in entertainment history? Again, I don't know the details of the contract for every entertainment show on television. They just signed a new six-year agreement with us, four of which is guaranteed, the final two of which are dependent upon very achievable ratings markers. And I don't think that -- in my memory, I do not know of any entertainment show that was ever ordered for a guaranteed four-year run.
So, apparently, people at this other unnamed network believe what we do, which is that "American Idol" has struck a chord in this country. Not just this country. We own the "Idol" franchise that appears in original versions in 30 other countries where it's equally popular. It seems to us that this really has the makings of a game show. On American television, game shows run forever.
CAFFERTY: Any chance we can interest you in making a play for IN THE MONEY? Why are you laughing.
SILLERMAN: Let me ask you a question. Is IN THE MONEY in the money?
CAFFERTY: It must be.
CAFFERTY: We're being told in our ear, Bob.
SILLERMAN: Well I think it's a brand. CKX is all about taking superior brands and trying to help market them to a wider audience.
SERWER: This is superior.
SILLERMAN: So perhaps we should talk to Carl Icon about this?
SERWER: Now you're getting sensitive there.
SILLERMAN: Who would I talk to about it?
SERWER: Dick Parsons, Icon.
SILLERMAN: I can find someone to talk to.
LISOVICZ: Thanks so much for joining us.
SILLERMAN: Thanks for having me.
LISOVICZ: Coming up, a retired couple that isn't afraid to let their dreams fly. Their unique choices and how they made them come true are the focus of this week's "Life After Work."
Put our producers to the test with your e-mail insights, drop us a line. The address INTHEMONEY@CNN.com .
LISOVICZ: For most people retirement is a time to slow down and reduce your risks, but in our "Life After Work" segment this week, we caught up with one couple from Alaska who flew south to literally live life on the edge.
(BEGIN VIDEO CLIP)
LISOVICZ (voice-over): Hanging from a kite 3,000 feet above Georgia's lookout mountain might scare most people, but not Tosh Hopkins.
TOSH HOPKINS, HANG GLIDER: To me it's very peaceful up there just boding about with the birds. To some people it is exhilarating. But to me it is peaceful.
LISOVICZ: Tosh Hopkins and her husband Bruce retired to Lookout Mountain earlier this year. Living within their means and smart financial planning while Bruce was a pilot in Alaska allowed the couple to leave the working world in their 50s and pursue their passion for hang gliding.
BRUCE HOPKINS, HANG GLIDER: We practiced when we were in Alaska by keeping our living expenses below the level of our income. Most of our support at this point is in stocks and bonds. That's proven to be a viable way to go, at least for us.
T. HOPKINS: We're going to launch over here.
LISOVICZ: At Lookout Mountain the Hopkins found a community of hang gliders and living on the landing field allows them to fly as often as they want. Bruce Hopkins pilots an ultra light plane that lets him tow his wife's glider to 2,000 feet right from their front door.
T. HOPKINS: I think it's magic. Because according to the laws of science you can't take more energy out of something than you put into it. With hang gliding you get more energy out than you put into it.
B. HOPKINS: This is a lovely part of the country. Everything we like to do is here. So it's turning out to be a very nice or ideal retirement location for us. (END VIDEO CLIP)
LISOVICZ: Be sure to tune in next week when we'll meet a former banker who says he's working harder than ever restoring classic boats on the banks of the Chesapeake Bay. We'll be right back.
CAFFERTY: A lot of people started doing their online shopping last weekend, but they didn't exactly go to the cyber mall. It was more like the cyber garage sale. That's the focus of Web master Allen Wastler's "Inside Out." What you talking about?
ALLEN WASTLER, MONEY.COM: Well you know over 27 million people hit the net on cyber Monday. You have Black Friday and now we got cyber Monday. They cruise in using their work connection, for the most part, and they are going shopping. Where do they go? Do they go to Amazon, walmart.com, well some of them did. But the big winner was eBay. It had over 11 million people going there. Nearly twice as many as the folks going to Amazon.
WASTLER: Well, eBay is the big flea market on the net. You can get a lot of good deals there. A lot of people are wondering, does this mean the other retailers are not. Here's my theory. You go to eBay because you know you're dealing with a small business or a regular person, not a big Amazon type. It will take longer to hit the mail. It will take longer to get to you.
What we will see is as we get closer and closer to Christmas, that big eBay bunch is going to shift more and more to Amazon, to Wal- Mart, to Target and the big boys there. I'm a late shopper. I use the Internet. I'll be hitting Amazon when we're in the teens, approaching the 20s. What am I doing next week? It's Christmas.
SERWER: It is FedEx's favorite days.
WASTLER: Now you will see another big bounce in eBay probably after Christmas because eBay has become a place, great Aunt Matilda gave me, I don't know. And also gift cards. You get a gift card to someplace you don't like. What am I going to buy.
SERWER: Can you sell gift cards on eBay?
WASTLER: They are trading them. I have a $50 and you have a $50 for Cabela's let's trade. But eBay makes money on all those trades.
CAFFERTY: Besides eBay, what's the other "Fun Site of the Week?"
WASTLER: The "Fun Site" you know what we found the latest recruitment video from the government. Let's check it out.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I need some soldiers. We need more boys to be in and we're having trouble recruiting want to learn to be saluting. Join the army and we'll give you a free haircut. The military needs new persons. The situation is urgent. There ain't no shortage of insurgents.
(END VIDEO CLIP)
WASTLER: It is all meant in good fun, so you know take it with a grain of salt.
CAFFERTY: Very good. Thanks Allen.
Time now to read some of our answers to our question of the week about whether you plan to spend more or less money this holiday season than you did last year.
Al wrote, "I don't plan to spend more. In fact I never plan to spend more, but I always do. I've cut back my list, but with gas prices going higher and all the hidden extras, I'm bound to break my budget again this time."
Susan wrote, "That is out of my hands. I have less money than ever, even though I've never been out of work, and I've been working since I was a teenager. This is the worst economy I've seen in 50 years."
And Eddie wrote, "I don't plan to buy anything. I finally figured out that the Roman merchants must have invented Christmas to keep the Christians forever in debt!"
Next our email question for next week which is the following, "What's the craziest thing your boss has done at work?" And names and pictures are welcomed as well.
SERWER: I know some of those people, I have worked for them.
CAFFERTY: Send us your answers to INTHEMONEY@CNN.com. And we invite you also to visit our show page at MONEY.com/inthemoney. Which is where you will find our address for our "Funsite of the Week."
On that note I thank you for joining us for this edition of the program. My thanks to CNN correspondent Susan Lisovicz, and "Fortune" Magazine editor at large Andy Serwer, and MONEY.com managing editor Allen Wastler.
See you back here next week hopefully, Saturday at 1:00, Sunday at 3:00 Eastern. Until the next time enjoy the rest of you weekend.
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