vimarsana.com

Welcome back, everybody. Lets get back to our guest host for the last word. Jim, you said at the very top of the show, that in your opinion, the fed has accommodated and the net policy will stick around for some time to come. The last word here, i want to mention one thing we havent talked about today, which is that the fed president s all signed a letter on Money Market Mutual Fund reform. I think thats an important statement. And a big risk is still out there, i would like to see that reform get moving. Jim, thank you so much. Glad to have you here. Make sure you join us on monday. Right now time for squawk on the street. Good friday morning. Welcome to squawk on the street. Im melissa lee, with scott wapner and james cramer. Carl quintanilla is on assignment and david faber is in palo alto, california, getting ready for his big interview with meg whitman. It looks like a comeback. Dow looking at 89 right at the open. Look at the picture in europe. This is really being driven by those eco numbers, giving stocks a bounce. Despite forecasts that the euro area economy will see backtoback years of contraction for the first time. Of course, now the focus turns to the weekends italian elections. Overnight in asia. Shanghai is closing out its worst weekly loss in two years. Nikkei managing to close higher. Road map this morning starts with the markets. We results from aig and upgrade for home depot helping stocks today, and hewlettpackard. Hp is popping premarket on the back of the earnings. Sigh of relief for the investors as the company showed some progress with its turnaround. David will have the exclusive with meg whitman in just a few minutes. More signs of consumer trouble. Nordstrom gives a weak outlook. Darden revising lower its outlook for the year. We start off with the markets. Pointing to a big rally today as the market recovers from fears that the fed will halt its easing process sooner than expected. This after stocks post their biggest twoday drop of the year, closing at two and a halfweek lows in the heaviest vim trading day in 2013. I feel that there were some calls yesterday on Dennis Garvin saying 100 cash. That kind of call i think will be tested. I think theres a mix the pictu picture. Whats developing, good news, bad news. The 100 cash call, which i think shocked the market, may not hold off on the daily today. It seems to overreact to anything fed. The minutes happened a month ago, january 3rd, we all got spooked, it sold off. That was a negative feeling in the market. A couple days ago, minutes come out, market gets spooked and here we are higher today. The german confidence numbers, for many for 30 years i didnt care whether the germans were confident or underconfident. Who cared if they felt good or bad. Now its the end all, be all for how the european stocks do. And therefore, how we here in the United States do. Exactly. And i think that what happened is in the last couple days, we started getting gripped again by china. Maybe chinas not strong enough. Very worried about europe. Then you add those on to the fed minutes and think, wait a second, doesnt the fed know theres a gasoline that theres a run, a speculative run . Doesnt the fed know about this . Where are they . The irony of the fed minutes is they said they should consider changing the pace of qe, so if the economys better, right, theyll pull back qe. Or if there are questions about the efficacy of the program, in which case it doesnt matter if theyre in there, because it doesnt work. So either way, it would be good in theory. What i thought was disheartening, for a couple of weeks we were focusing on stocks, on companies. M a, right . Focusing on the pickup in m a. And then we see, oh, no, its not the pickup in m a, its the spanish banks. Arent you worried about berlusconi . I am not going to go back into a world where all i care about is italian unemployment. Just not going to go there. I worry about our unemployment, so does bernanke. It proves again, to the fed, the minutes are old news. Bullard exclusive on cnbc, comes out and says, were easy, and were going to be easy. Dont worry. The punch bowls not going away. You can still drink. Its okay. Thats extraordinary. Weve heard him go the other way. Now, can he get people in washington to not talk today . Good luck with that, jim. Thats always my worry, that they have mouths, microphones. You have the sequester fast approaching. We should put up a countdown clock. Thats coming. What, are you not worried . You better start worrying right now, partner. Ill climb my own wall of worry. Stop worrying about the ballet, and the guys on the ice. Thats a different conversation for another time. Fear matters. Hewlettpackard trading higher in the premarket after better than expected quarterly results. The company reporting secondquarter results and a forecasted above expectations as it cut costs under ceo meg whitmans turnaround plan. David faber is live at hewlettpackard hq in palo alto, california, where hell be speaking with meg whitman in a few minutes. Thanks, scott. The stock looks to be up. I heard you mention a number of analysts deciding to raise their price targets after the Conference Call yesterday. Although, interestingly, hewlettpackard did not adjust its own number in terms of what it expects to earn per share for this full year. Despite what was, as you said, a better first fiscal quarter and pointing to a bit better fiscal quarter, at least than the analysts who followed the companies it anticipated. It is not as though there are still signs of weakness. Certainly the pc business, certainly what well talk to meg whitman shortly about as well, continue to show signs of deterioration. How do you manage these painful transitions is a key question for hewlettpackard. As it is still dealing with all of the key sectors seeing revenue declines. Now, thats not a surprise. Whitman has pointed to that for 2013, talking about 2014 as a year in which you may start to really see growth yet again at the company. And so many people embracing that number from yesterday. At least saying, hey, you know what, things arent quite as bad as we perhaps had thought. Certainly a lot better than they were last quarter when we were dealing with that fraud and autonomy, enormous writedowns and lots of other questions, including the deterioration of the underlying business. Well talk more about that, and the Enterprise Group and get a sense as to whats going on in europe and china very shortly. Back to you guys. David, well certainly look forward to that interview with meg. Do you have the feeling the turnaround is taking hold as the bulls are sort of trying to spin that story forward this morning . Stuff like the beating of the comps, they talk about how the data center coming on, storage coming on, printers coming on, then you have what really happened, printers down 5 , storage down 4 , data center, storage down 13 , data center not doing all that well. Margins contracting in everything but printers. Right. Its kind of, look, were doing well, you just keep seeing the soldiers being killed. Not terrible is the new good for hg. Theyre expecting the worst from hewlettpackard. Theyre looking for signs of deterioration. The analyst from evercore said it wasnt a deterioration into nothingness. It doesnt take much at this point. You still take a look at the higher value segments of the business, the software business, what is supposed to be the savior of hewlettpackard and those were down year on year. Were not going to fade into darkness. I guess the tone on the desk is a little negative towards the results, obviously. What is it going to take for that story to start actually really being better, real better . Theyre not going to break it down. Up 2 . Cash flow. Could they get rid of all their debt . That could be an incremental positive. The fact that its a freeflow interview with david out there. That interview is straight ahead. Fabers exclusive with hewlettpackard ceo meg whitman. Well get her first reaction to the companys firstquarter results next. Looks like the futures are going to be a nice open on the street. Dow looks at an implied open of 79 points, or thereabouts. Nasdaq getting a nice rebound after a new day of selling. [ male announcer ] to hold a patent that has changed the modern world. Would define you as an innovator. To hold more than one patent of this caliber. Would define you as a true leader. To hold over 80,000. Well that would make you. The creators of the 2013 mercedesbenz eclass. Quite possibly the most advanced luxury sedan ever. See your authorized mercedesbenz dealer for exceptional offers financial services. Lets get back to david, who is at hewlettpackard headquarters in palo alto, california, with an exclusive interview with the ceo meg whitman. David . Thanks very much, melissa. As you said, were here in the headquarters. The building has been redone a bit. Thank you for having us and hosting us. Meg, yesterday, at the conclusion, or near the conclusion of your prepared remarks in the Conference Call, you characterized the quarter and sort of hewlettpackard as saying the patient showed some improvement. What exactly does that mean . Well, i think its accurate. We put down a very good deposit towards our full year performance that we have told the street would be 3. 40 to 3. 60. We beat the the high end of our guidance by about 11 cents a share. There were very bright spots in our performance. But weve got a long way to go. Im clear, this is a multiyear journey to the turnaround. And throughout your comments, the prepared comments, even in the q a, youve said it in our interviews as well, multiyear, you continue to say that. Anything changing your opinion as to how long this will take . No. I think last year we characterized as a diagnosis, and laid the foundation year. We really needed to understand exactly what the challenges were and what the opportunities were going to be, and lay some pipe to set us up for a better 2013 in terms of products that are introduced to the market, our gotomarket, our relationship with our channel sellers. You probably know the channel really builds hewlettpackard. Well see revenue acceleration as we go into 2014. Why not have increased guidance, and guided the analysts to a higher number than they anticipated for the second quarter. We do feel very good about certain parts of our business. But we also face some headwinds. First of all you mentioned in your opening, the pc business faces some challenges. We should talk more about that. Europe is a very tough economy. And we have the highest market share in servers of any competitor in europe, so when europe is soft, were disproportionately hurt in that business. So we thought it was better to not get out over our skis, you know, one quarter we got three more to go, and we want to make sure were cautious, and this business changes very rapidly. Indeed it does. Lets get to pcs, because there the changes perhaps happening more rapidly than some had anticipated. Sales to consumers down 13 , sales of pcs and notebooks deteriorating quite rapidly, more rapidly than you anticipated. This is a painful transition. How do you manage it and what do you tell people to expect when youre just talking about a unit that does 10 of your operating profit, at 2. 7 margins . Yeah. So theres a couple of reasons we really like this business. And first of all, there is a huge transition taking place. The reason weve never called this business the pc business, we call it the personal systems business. Its an important difference, because if youre just talking about pcs, versus everything from virtual desktops to work stations to desktops, more traditional desktops to laptops to hybrids to tablets all the way to smartphones, thats the personal compute. Perm compute is growing. Everyone wants to create, consume and share. So we like the overall market. But there is a transition from more traditional form factors to new form factors. Theres also a transition from really one operating system to multioperating systems. What is this going to look like if in fact you get it right . Not saying you necessarily will, because managing these kinds of transitions are somewhat unique. We simply have no idea whether consumers are ever going to buy a pc or notebook again. At hp, weve got to reallocate resources just from our pc business to the mobility business, to from one operating system to multi operating systems. We have to allocate some more resources to services. Because profit pools are shifting here. Think about whats happening with devices. I mean, i dont know how many devices you have, i have four. So how you manage those devices, how you manage that convergence. Security, hp knows more about balancing access with security than any other company. And heres the other reason why this is an important business to us, no one knows more about computing than hp. And its a core dna, part of a dna of this company. So we like being able to go from the device to the data center. But its a tough transition to manage. But you know whats great about technology . If you miss one trend, theres another one right around the corner, and the Development Cycles and the speed at which this is moving is incredibly rapid. You appreciate that speed, and can you stay with it. Yes. There are many investors saying youre doing 8 billion a quarter, a tiny margin. Its not a big part of your business anymore, get rid of it. But its a strategic part of the business. You know, theres a lot going on in technology. This is some of the biggest shifts in technologies that ive seen in my career. You know, about every five to ten years, theres a big shift, whether it was from the main frame to the Client Server environment, server to web 1. 0, to what i would characterize as 2. 0 web services. Were going through another sea change in terms of how technology is bought, how its paid for, how applications are developed. We happen to have a fantastic set of assets that i think positions us incredibly well. My predecessors, even through all the turmoil, really assembled a terrific set of assets that will allow us to take advantage of what i call this new style of i. T. Were the only company that can go from devices that connect to this new style of i. T. To hardware to software to services, that i think can position hp incredibly well in the next Big Technology way. Do you feel like youre able to measure everything you want to do . We all look on wall street at signs of progress being, well, will you spend the revenue, how is the stock price doing, earnings per share. What do you look at to really gauge progress that youve made . 18 months, 16 months since you took the job. Yeah. Can you measure everything you need to to figure out whether youre making progress . The first thing i look at is products. Hp is going to come back on the foundation of breakthrough Innovative Products that customers really want, that help solve our customers toughest problems. I think if you talk to most people in the industry, i was at our Partner Global conference earlier this week in las vegas, and we had the top 2,100 partners at that event. They said this is the strongest product line up weve seen in hp for ten years. In ten years, one of the criticisms is innovation is no longer something we think about when we think about hewlettpackard. What do you see as a real innovation for this company . First is in our Enterprise Group. Your listeners should know it gives us 43 of the profits of hp today. I dont think most people dont understand that. They still just think printers and pcs. Exactly. For example, well start shipping in march a revolutionary new Server Technology called moon shot. Which is effectively servers that are built on arm chips and atom chips. Almost the same chips you have in your cell phone. So much less space. 92 less space, 86 less energy, and half the cost. So this is revolutionary. And we started taking orders. Youll be interested to know, our first order came from a company in japan. The reason why . Japan lost 25 of their grid from the tsunami. I was in japan last summer, and the Office Buildings were only being cooled to 84, 85 degrees, because they dont have the grid. So this kind of product is revolutionary. And should allow tremendous breakthrough in hyper scale computing, high tense di computing that schangs the game. Thats the kind of thing hp is known for. And transitioning into that business as well, parts of the server business are in decline. Convergence are in ascent. This is a deal that was done quite some time ago, where you fought with dell. Thats another transition thats painful and uncertain that you have to manage in addition to the pc business. When you run a Big Technology company like this, there are these transitions. I think because much the change of the ceo, and the sort of drama that happened at this company, those transitions maybe werent managed as well as they could have been. But thats part of being in the technology business. Youre managing products that are new and changing the games. Threepar storage was called converge storage. It was simple architecture, better storage than anything on the marketplace. But we have our traditional storage products that are declining. Weve got to get three par bigger than our declining products and all of a sudden well have a growing storage business, which were confident it will. We talked a great deal about autonomy last quarter. Certainly dont want to dwell on it. But im curious, where is the investigation, in your opinion . There were a lot of questions at the time, well, is it really everything youre saying it was . Or was it more just hewlettpackard screwing it up, my words. Where are we on that investigation . Is there anything you can point to . Yeah. Well, you recall at the end of last quarter we took a writedown on autonomy. We said, listen, there were misrepresentations of the Financial Condition of the company. And so listen, since then, we feel even more strongly about those allegations. And the department of justice, the s. E. C. And a number of enforcement agencies are taking up this case. And what i said last time is, weve done our work. Were going to turn this over to the authorities. Obviously tell them everything that we know, that our internal investigation is ongoing. And then weve got to go back and run the company. And thats what im focused on. And ive turned this over to our very capable legal team. The wheels of justice turn slowly, but were confident and finally, were more or less out of time here. But we continue to here the murmurs, they should break the company up. Its unclear where these things come from. They arent true, but do you feel like you have the full surt support of your board and the basic idea that this company is Better Together than it is apart . Yeah, we do have the support of the board. And i am convinced that we should not break up this company. That we are better and stronger together. But in the end, obviously the Financial Results are going to have to underscore that strategy. And thats why weve laid out this multiyear journey to basically be very clear to people that we wont see revenue accelerating until 2014. And that will be on the backs of this excellent portfolio that is uniquely suited to the new style of i. T. So were confident about it. But obviously everything is about execution. And weve got to continue to execute just as we did this quarter. Meg whitman, as always, always appreciate youre agreeing to come on a. Over 300,000 employees, operations around the world. Ceo of hewlettpackard. Back to you. The exclusive with the ceo of hewlettpackard. Shares rising in the premarkets trade. We should note that even though youre skeptical of the results in place right now, oi may be in place, ubs out with an upgrade. I think when you listen to the interview, what shes saying, listen, were not just a personal computer company. I take that at face value. But i dont really know what happened to their terrific consulting business. Thats got to come back a little. I did like this notion of enterprise, and we havent lost our innovation. I think if you listen to that interview, you say, it aint as bad as we thought. Is that enough to be in the stock . I mean, if you had hp shares and you saw a 5 premarket, would your inclination be to hold on to the shares, but it could be a multiquarter, multiyear, would you sell . No. The dell deal is in mind. She may say not break up. But theres always the possibility here that things get a little bit better in europe. This would turn. This company has not lost its entire basis business. Do we have to consider the fact, though, that this is a multiyear journey, as meg whitman says, that this is tech, the hardest sector to make such a massive transition . Because if youre looking at a multiyear transition, its so difficult to forecast three to five years out about whats going to be taking place in tech. Five years from now we know General Electric will be making turbines and engines. In five years, whats going to be the hottest thing in tech . Either way, you have a backstop on the stock. Balance sheet a little better, cash flow good. Data maybe a little better. All right. Five minutes to go. Before the bell rings. It is time now for mr. Cramers mad dash ahead of the market open. Darden . Youre going to see darden up. Darden should be down, right . They once again said things werent so good. They talked about the macro headwinds. Youre supposed to say, were not doing as well as we thought because of payroll tax increase, and gasoline prices. So theyve got the script. I guess the script came out and it was that spielberg who did that, disney . What movie told you to use that script . The script is so prevalent people read it and say the problem with the dri is they have a different script every time they find a script. Whatever macro is. In the end, its just a nogrowth story. And we want growth. And they dont have it. They just dont have it. Red lobster down 7 . Why does it always take forever for me to get into olive garden . Why doesnt mad money get me in there . Do you still stuff the rolls in your pockets like i do . Alfredo sauce dipped in there. Im just saying. The salad. Dont ever underrate that. I would never. The final opening bell for the week just minutes away. More squawk on the street coming up right after the break. Recognize me. But i am your market data. I know what youre looking for. Im not chained to your desk anymore. Im faster and smarter now. And so much less expensive. I am your market data. And if i do say so myself, i have never looked better. Superderivatives introduces dgx. Data done differently. [ babies crying ] surprise your house was built on an ancient burial ground. [ ghosts moaning ] surprise your car needs a new transmission. [ coyote howls ] how about no more surprises . Now you can get all the online Trading Tools you need without any surprise fees. Its not rocket science. Its just common sense. From td ameritrade. Just a few seconds before the opening bell rings here on wall street. A lot to watch for on friday. We have the interview with meg whitman, and more potential deals in the works here. Kkr knows that space very well. This is, again, the oil patches controlling. This is what ive been hearing. Monterey is the next montego bay. They may not fit the setting too well. Youre watching the opening bell, the s p 500 at the cnbc realtime exchange at the big board, Charles Schwab corporation. Uptown at the nasdaq, the x1 company, maker of threedimensional printing machines. Talk about the runup for the 3d printing companies. Take a look at 3d systems, x1 recently ipod. Saying that this is the next frontier with a lot of commercial applications. I still worry that the less is merrier, not the more. Listening to an Israeli Company this week saying they have the software for it. Very hot group. Are the ones yesterday, you brought this up earlier, jim, the gartmans, those who have called to go to cash, either all cash or get out of u. S. Stocks, are they going to regret making that call at this point . I think those days are kind of over. Were not going to nationalize the banking system. The center will hold. This is not 1933, 34, where fdr comes in and hes worried about the left, hes worried about the right. We did have that feeling in 2008, 2009. Those days of 100 cash, thats for traders, its not for the people at home. Not practical. No. Can you imagine calling, i want to go all the cash right now, sell it all. Listen, youve only missed your the dow at 6780 and you go 100 stock . You can do that. Its called whip saw. Buy high, selling low. The last couple of days there was certainly a feeling in the market that we were perhaps on the cusp of this bigger pullback, and the s p right now is still above 1,500. The dow is only 50 points or so away from the 14,000 level. Right. Yet again. It shows you, you need to temper all of these quick decisions that people so want to make. Things are mixed. Today i feel people say the sequesters off. Look, i think its not as good a time as it was a couple weeks ago. Better time than it was a couple years ago. All right. Lets look at some of the stocks that are moving. Home depot, yesterday got smacked with the downgrade. Today getting an upgrade from oppenheimer. Now matching its ratings for lows. Raising the price target for both of them seeing theyre seeing demands, possibly accelerating. Were getting a lot of on the one hands, and on the other hands in terms of these stocks. Thats such a great point. Part of the note here is you could look at other stocks and say that, wait a minute, walmart, you could look at that, look at some of the other names and say, wait a minute, others are saying the spending back drop is not good for the discretionaries. Your pipes break, youll go buy another one at home depot. The consumer, thats discretionary, they dont even know what discretionary is. The thing that yesterday you had a great discussion about home depot in your show. Stephanie link said, look, reports, the stock has had a big run. Even if it is great, it may not be enough. We saw a lot of that. Toll brothers is great. But was it enough. And toll, up what im saying is, im not calling all fear. You just dont want to call all fear. You just want to call all mixed. I think that people want to be extremists. They wanted to come on and they want to make that bold call. Harry dent. Harry dent, yeah. Its going to 20,000, and the next minute its going to 600. A buckner. What did buckner do . Bill buckner . Yes. He was bullish until a ball went through. I just dont want to make that big bearish you dont want to have a bucknerlike moment. Thats a dangerous thing. Those at home, probably the biggest month of our career. Was there a worse month . No. I dont want to muff it. Thats what a bold calls does. You dont want to buckner it. Thats a good one. Whenever you become a verb, thats pretty big. I just feel like youve got to be very vigilant about the idea that you dont want to sit here and say, youve got to sell apple. And then Morgan Stanley puts out a note that they could double the dividend. After speaking to the cfo, she says at Morgan Stanley, yet the stock doesnt do much. What does that tell you . I mean, i would think that would tell people perhaps maybe theres some sort of, i dont want to say bottom end for apple, but maybe thats the best thing for the stock right now. For a few days it got off. Look, im going to throw away everything apple and buy chrome. Making me feel like i should throw away my ipad, my desktop, itunes. Im getting rid of everything apple as of this morning, including the apple watch, which i dont even have yet, and replacing that with a swatch watch. Right now apple is like, to me, its no longer that the apple nothing like the apple on your head. William tell overture partner. Its no longer positive. You could get hit by that arrow if the archer isnt careful. Not everybodys the hunger games. The day after einhorn held his conference with apple shareholders saying he could boost or his plan could boost apple shares by 150. Youre at the epicenter of your show. Is it more important to what the hedge funds say or whats happening at the company . Is the company no longer important versus the Hedge Fund Billionaire . I hear are there any apples no longer the most loved stock in the hedge fund world. Look at aig. You talked about it. Aig is. Aig is the most loved. I tell you, give me some loving. Apples not even on the top 50 of citis new global champions. Really . Apples not even on the list. Holy cow. But the question is, why should it be on the list . Coach is on the list. Nine times earnings. Coach is on the list . Should go buy coach. Buy a man bag. Man purse. Are we saying that on the list, which i have here somewhere, that apples not one of the best 50 . Best 50 what, though . Listen, maybe thats the bottom. Coach, cummins i like cummins. Ebay. I like ebay. Speaking of watches, you can get a fossil instead of a swatch. Listen, man, fossil, i told you yesterday fossil is going to determine whether that apple watch is better than the google glasses. Googles on the top 50 list. I believe that. Im going to 1,001 right now. Where is brian white . Right. That almost i dont want to say it topped the stock. When you start to get the really far out there price targets on apple, thats when the cracks in the story started to really look, heres capital oil and gas. One of the best performing stocks of the last few years. Whats it doing . Its up five on a good quarter. The marcellus is good. You go back to the Gardner Denver. Many things are happening that are positive that are away from apple. But if you just are apple centric, google centric, you keep people out of the oil patch. Youve got to be responsible. Youve got to be responsible and talk about things that are working. Right. All right. Oil patches, one of the best performances of a lifetime. Do you care . I do. So does bob pisani. Hes on the floor with more on whats moving. A nice move to the upside today. Scott, did you notice, im sure youre watching jim bullard on our air this morning, saying the fed is going to stay easy for a long time. I got a lot of emails for that. Bullards considered a moderate. I thought that was an extraordinary statement. The big debate this morning is, what kind of slower period for the economy are we actually entering into and how is it going to affect stock . Weve got kraft foods, burger king. Weve got a couple of other companies commenting here. You said abercrombie, sales down. Comps are much tougher because of the warmer winter season last year. But now people coming out and confirming that. That stock down about 2 . Darden up 2 . They talked about the payroll tax increase and higher gas prices. Nordstrom, very interestingly, guided below consensus for 2013. They didnt comment on the economy. A lot of people trying to figure out whats going on. The only thing i would note about nordstrom, all the Department Stores, they have underperformed almost everything. The overall market, even though the retailers, since the start of the year, i think theyre being used as a source of funds for other things. Just note that theyre kind of stuck right now and have been, not just this week, but really since the start of the year. A lot of analysts turned negative, a lot of people talking about tom lee over at jpmorgan, says right now we recommend investors turn cautious and defer incremental purchases. A lot of people talking about market tops in the short term. A Technical Analyst said the markets may already have entered a correction phase. Ill make a simple observation on this. Every time the s p 500 gets 8 , 9 above the 200day moving average, the market stalls out. Its hard to keep moving straight up like we have in january and february. We hit that 8 or 9 move over the 200day moving average, it stalled out and did it twice last year, same time it happened. Tough week for the overall markets. Chinas down 5 . This is the worst week in 21 months for them. Melissa, home prices are going up there. Report out overnight, clear indications that the Chinese Government is going to be very aggressive in trying to deal with that. Thats a problem for the markets. Hong kong already addressing it, bob. Meg whitman sitting down minutes ago for an exclusive interview with our own david faber. David is with us live. David, your takeaway from this interview . You know, i think interesting, of course, that meg continues to defend the pc business, which this quarter did not have a good quarter. We said many times during the course of the interview about a vicious transition, one that perhaps is seeing deterioration amongst the willingness of people to buy pcs and notebooks faster than might have been anticipated. Raises questions for the likes of dell, and a lot of. Net on its balance sheet, and raises questions for hp. She gave her reasons why this business continues to be an important part of the whole at hp, despite producing only 10 of the profits of the company, and why she feels they can successfully manage this transition. It will be fascinating to watch. Certainly i thought that was interesting. I think its true, the board certainly supports her at this point. Quarters like this one will only give her more credence in pursuing the turnaround and the idea that this company as a whole is better than in part. Did want to add a few things we didnt get to, but meg and i were able to talk about offcamera, europe and Southern Europe in particular. Very, very weak for this company. Cfo kathy characterized it as dismal in the conference yesterday. Nothing Getting Better in Southern Europe. In fact, meg said getting worse. Something to keep in mind when we think about italy and spain and the likes. Jim, what is going on there in europe. China, by the way, shes with you, she says it is getting appreciably better. Seeing a great deal of progress in that market. The u. S. Kind of bumping along. Boy, weve heard that a lot, havent we, guys. David, youre so right. There was enough to encourage me about china that i just kind of put europe aside. But thats probably a mistake, because the europe thing was supposed to be stabilizing. There was nothing in other comments about stabilization. No. And in fact, again, quarter to quarter, it got worse. And that those ink sales in particular, we talked to meg enough to remember things from past interviews, they can sometimes be a leading indicator to a certain extent, jim. And so i dont know if were going to be revisiting europe every day again. I certainly hope thats not the case. But it cant be something thats just in the rearview mirror, especially when you see Companies Like this that are bellwether companies for the world, and saying, things are getting worse. I thought it was a great interview. It obviously made the stock stronger. I think she told a strong case. Great job, david. Great job. Thanks, jim. Rick santelli at the cme group in chicago. Go ahead, rick. Good morning, jim. Say hello to pop this weekend. As i look at 10year and 30year, lets start out with the longer maturity. Interday 30, you can see were coming back down towards 315. Roughly ten basis points off of what was considered kind of the area of resistance in yields around 3 3 4. If you look at a twoday chart of 10s, you can clearly see weve eased back a bit. Considering that the dow is coming back from or equities in general from a couple of days of squeamish downside, some would think later on in the session, maybe well get a bit of selling pushing yields up. Traders are thinking theyre going to stay right here, just under 2 . Lets open this up a bit. Lets look at the euro currency, and lets look at it over the time frame, well, going back to january. Because were very close to unchanged on the year. It started to move a bit lower after ltr 2 paybacks were very light. Which goes to the weak european story. If we look at the yen, important. Lets look at it for the month of february. Its correcting a little bit. Yes, its not going straight down. Thats the dollar yen. But remember, in several days, were going to see a new head of their central bank. This could be big. Abedomics theyre calling it. Best levels since about midaugust. And we want to Pay Attention to this. Because many think our central bank is hemming and hawing. Now maybe its the ecbs turn to ease, why . Because yirp is the story. Jim is so right. Europe is the story. Europe is more of a story than i dont want it to be. I want it to be america. Its just not working out that way. Jackie . Long time no see, jim. Lets take a check on the energy prices. Youre talking about europe. Thats what was sending wti earlier. Now that price pretty much flat, under 93 a barrel. Still, the brent crude price is higher, above 114 a barrel. That price snapping a fiveday losing streak. Meantime in the rest of the energy complex, were seeing gains in gasoline as well. The metals complex is lower across the board. Copper continuing its declines after having its biggest singleday losing streak yesterday. It was briefly able to bounce into positive territory this morning. But not able to sustain those gains. Of course, were watching gold prices hovering around 1575 right now. Telling me analysts telling me we could see a little bit of volatility in the gold picks today. Weve got options expiration and the coming sequester, stronger dollar. Well see what happens with gold. Melissa, back to you. Thank you, jackie. Were just one week away from the sequester when automatic spending cuts will kick in. Will it really hurt the economy. One fund manager calling it a joke. Hear what stanley has to say next. Boeing has a fix for the dreamliner, but will the faa approve. If it doesnt, boeing could lose even more money. Find out what it all means for the company as well as the stock. All stations come over to mission a for a final go. This is for real this time. Step seven point two one two. Verify and lock. Command is locked. Five seconds. Three, two, one. Standing by for capture. The most Innovative Software on the planet. Dragon is captured. Is connecting todays leading companies to places beyond it. Siemens. Answers. You are gonna need a wingman. And my cash back keeps the party going. But my Airline Miles take it worldwide. [ male announcer ] it shouldnt be this hard. With creditcards. Com, its easy to search hundreds of cards and apply online. Creditcards. Com. Here we go. Stanley is calling the automatic Government Spending cuts set to kick in at the end of next week, he argues the focus on the sequester is obscuring the real issue which is the exploding cost of entitlements. The hype over sequestration is a joke. Sequestration is 85 billion. Youre talking about a quarter of of gdp. Drukenmiller said if its not dealt with in the next four or five years, the Interest Rates are going to explode and the next generation is going to have a tough time. Tough words. Stanleys pretty good. Ive known him for 25 years. Weve got to deal with entitlements. What gives you any comfort that theyve got the wherewithal to use a word that i can use on tv, in d. C. To actually do something about it. None, right . No, but i what happens if the tax receipts are really big this year . What happens if we get upside surprise of how much the governments already raised . Why not take a pause, and kicking the can down the road, thats always been considered to be lacking in rigger. Obviously worked in europe. Why not do a little bit of improvement, and say, hey, look, lets just wait a bit until this economy keeps firming. Dont be the reason why the economy doesnt firm. A lot of jobs created when the economy firms. Thats a fact. Find out why the white house is taking a page out of silicon valleys book and holding its own pacathon. Well be right back. Ve embraced a new role. Working behind the scenes to provide companies with services. Like helping hr departments manage benefits and pensions for over 11 million employees. Reducing document costs by up to 30 . And processing 421 billion dollars in accounts payables each year. Helping thousands of companies simplify how work gets done. Hows that for an encore . With xerox, youre ready for real business. Good morning. In the next hour of the program, well look at what nordstrom and darden are saying about the American Consumer. Well also meet the man who turned a broken iphone into a 1 billion business. Scott, back to you. Good morning. Time for six in sixty. Six stocks in 60 seconds, give or take a few. The first one, jimmy theyve got this very, very powerful antibreast cancer drug. Toxicity worries about it, but its going to be a hot stock. Isrg. Theres a big debate, golden comes out and says buy it. Youll have there you can see, the shorts right now are losing. Herbalife, you know how they work. Steeple with an interesting call in auto zone. Theyre saying its going to be a short fall. Ive not made a lot of money betting against auto zone. Wendys . A new aggressive mcdonalds. Credit suisse is talking about wendys. Near a 52week high. Bio marin . The great next drug company. Thats a good story. The cat getting a call today. Raymond james really making a difference here, saying, dont give up on cat. Thats what people are doing. This is the worry about the market. Should be up bigger. We did that in 60. Have a great weekend. What do you have tonight . You know, i Say Something thats i was somewhat critical about this reit thing. I have an interactive show. You Say Something a little bit not so great about a company, the guys say, wait a second. You put them right on. Maybe eat a little crow. I dont like to use salt anymore, so i put pepper on it. Buckner, dont be bucknered. I love that. Thats right. Coming up, were going to introduce you to the man who took a broken iphone and turned it into a 1 billion business. But first, its been a roller coaster of a week for the markets. Find out how you should be setting yourself up for the weekend. Were back after a quick break. [ male announcer ] ive seen incredible things. Otherworldly things. But there are some things ive never seen before. This ge jet engine can understand 5,000 data samples per second. Which is good for business. Because planes use less fuel, spend less time on the ground and more time in the air. Suddenly, faraway places dont seem so. Far away. [ male announcer ] from the way the bristles move to the way they clean, once you try an oralb deep sweep power brush, youll never go back to a regular manual brush. Its three cleaning zones with dynamic power bristles reach between teeth with more brush movements to remove up to 100 more plaque than a regular manual brush. And even 76 more plaque than Sonicare Flexcare in hard to reach areas. Oralb deep sweep 5000 power brush. Life opens up when you do. Welcome back to squawk on the street. Were live at post 9 at the New York Stock Exchange. Lets get straight to the markets here. It looks like were stabilizing after the first twoday stretch for the markets this year. Lets bring in bill stone, chief investment strategist pnc Investment Analyst for his take on the markets. Were at a slight pause here, bill. You see opportunities for a pullback right now. Why. Just really simply because weve gone longer than we typically do without a pullback. And certainly, you know, as everyones talked about, theres a couple things hanging on, more than a couple as usual, i guess, in terms of risks. I think you have to be cognizant of, weve gone a long way very quickly. And its a normal part of the market to have pullbacks here and there. Sequestration is one reason why. And also you mentioned the italian elections which are happening on sunday and monday. Are you really serious that the u. S. Investor should be worried whether or not pisani paks it in or not . I think you do. The way i look at it, two out of three of the outcomes are probably okay for the markets. One is good, which is that monti is part of the coalition and still running the government there. The second one is they cant really form a government and then they have to have another set of elections. Thats probably going to lead to some volatility. Though the negative one for the markets would really be berlusconi taking over power again. What you have to worry about as a u. S. Investor is really that that starts up all those fears in the eurozone again. I dont think it would get as bad as weve seen in the past, but it could certainly stir some of those past fears. But the good news, like i said, two out of three of those, and those are the higher probability items, are really market neutral, to lets call the one obviously pos fif. So after the move weve had in the markets is the really strong powerful meltup and then the correction. Which parts of the market do you believe are the most coiled springs in the event we kont get a problem in europe or the growth really returns here . Well, i mean, the coiled springs, i would say it was interesting when we were thinking about where to position today. Probably position a little towards less cyclical things. To answer your question, i would probably go to more cyclicals, areas that benefit from a stronger economy. Is there any point in the future where the market i understand youve written a long note about the trading scale, between bonds and dividends, and whether theres a rotation or not a rotation. Is there any point in which the market stops rewarding ceos for investing for growth and m a . That would be a bigger rotation still. I think youre exactly on there. Its hard to necessarily express it all the time. Part of our view on dividends is essence, youve got to focus on economies that can grow their dividends. Exactly what you were saying, companies that are really investing for future growth, because thats what the growth that will eventually, or continue to drive dividends Going Forward. I actually think that is what the market is going to it has rewarded that. And i think it will continue to reward that. Bill, where does the fed factor into all the conversation . There was the reaction clearly to the minutes. But we had bullard on our air exclusively today, basically saying were not going anywhere, and were not going anywhere anytime soon. You know, frankly, i think he was right on in terms of, i dont think theyre going anywhere anytime real soon. What you saw is just normally a lot of discussion at the end of the day. We know the chairman generally drives where things are going, and i think we know where his heads at. Im in agreement that i dont think that that was a reason that really the market should sold off a whole lot. In a normal day, if we hadnt had such a run before that, maybe it wouldnt have. I think that had as much to do with it as anything. Looking for an excuse, frankly. I guess my point is, doesnt that put somewhat of a floor under the stock market . As long as Market Participants know that the fed is not going anywhere, doesnt that limit the scope, size, anything related to a pullback . I would think at least some. You know, particularly forget the fed, just the Interest Rates are so darn low. Thats what i try to get to is, over the long term its almost like there is no alternative unless you really want to guarantee losing purchasing power over time, sitting in the safe bonds, treasuries or cash. You know, it does tend to push assets over to stocks. And because i wouldnt say theyre at all overvalued, i think it does add to some sort of a cushion there. The. Bill, were going to leave it there. Thanks for your time. Have a great weekend. You too. The point here is the sensitivity we saw yesterday. Saying they would find it very difficult to actually rein in i mean, the twoday move was huge. On just a neutral bias. It happened a month ago, the same Market Reaction to virtually the same kind of language. Just shows how sensitive everybody is to anything that the fed says. It speaks to the rally. Were looking for an excuse to sort of take a pause and profits ahead of the sequestration. You dont feel its something more profound than that . If they think theyre going to come back from qe . Think about what they said. They said theyll change the pace of qe if the economy improves, which we knew, or theyll pull back on qe if its no longer effective. If its no longer effective, it doesnt matter if its in the market. One things for sure, one of the standouts this morning is hewlettpackard. Reporting secondquarter results and forecasts above expectations as it cuts costs. Meg whitmans turnaround in the plan. Speaking exclusively with whitman just a few moments ago, back to you, david. Thanks very much, simon. Of course, good days in the stock market have been hard to come by for the last year and a half. Good quarters also very hard to come by. Characterizing this quarter, the first fiscal quarter of 2013 as good. Maybe a bit of a stretch. But it certainly was better than expectations. Something we didnt get a chance to talk about during our live interview was the performance of the companys printing business. You know, they sell a lot of printers and an awful lot of ink. In fact, they saw an operating margin improvement in that business. It was quite significant. And really, one of the only sectors that saw a significant margin improvement. I asked whitman after our interview, but on camera again, why, and can it continue at printing. Printing is not dead by any stretch of the imagination. Particularly in the enterprise. And when i first came to hp, i recognized that printing was 30 of the profits of this company. So if printing caught a cold, hp would catch pneumonia. And so ive focused on making sure we had the right strategy in that business. I have to say the team is executing. Executing to the extent that there are new products, new plans available to customers as well, that she at least believes is going to maintain if not increase that operating margin in a very important component of this company, as you heard 30 overall. Something else i asked whitman about is that dell deal. Remember the large lbo, of course, that may be in a bit of doubt, but likely still to happen at dell, a key competitor in a fierce market environment right now that is seeing significant declines overall, in consumers willingness to buy pcs or notebooks. I asked whitman whether that lbo may be something that does benefit hp. Uncertainty, and instability makes it hard for people to want to buy from you. Particularly enterprise customers. Because theyre making longterm bets. And so when dell goes private with 18 billion worth of debt on the books, that creates uncertainty around customer support, around future product road maps. So were going to use this advantage, were going to use this opportunity in the marketplace to our advantage and were going after dells customers. Interesting to see, of course, dell taking a bit of a different route there in terms of the commoditizing. You heard whitman during our interview saying were going for the overall Integration Systems that are a part of all of the different devices that you have, and all the different form factors. Overall, though, again, a good quarter for hp. A very strong stock price today. Not to be forgotten also, produced 2. 1 billion in free cash flow. So puts to rest some of those concerns perhaps about the debt load at the company which came down overall, the operating company, to 4. 7 billion. Scott, send it back to you. David, appreciate it very much. David faber out in palo alto. Aig is also coming out with a big beat on Fourth Quarter earnings. Mary thompson just got off the Conference Call. Hey there, scott. The it was quite a Conference Call, about eight different executives to go through the numbers on aig. Posting profits after accounting for losses linked to Hurricane Sandy and 90 of the Aircraft Leasing units. They earned 20 cents a share, well above expectations with a loss of 8 cents a share. Revenue was in line with expectations. The once failing firm repaid its debt to the government and the treasury sold its last part in the stake last year. Ben saying yesterday on the closing bell, key to aigs improved operating numbers, better underwriting. Our loss ratios for eight quarters now are slowly coming down. So the daytoday results are terrific. And we had a couple of headline problems, which caused still with the huge loss of sandy, we still made a profit in the quarter. Net premiums for the Core Property and casualty business were slightly lower than the year ago quarter. The investment portfolio helping to drive the improvement in the companys bottom line. Also helping a tax benefit, the firm says it will continue to employ in the coming years. Now, as aig continues with its recovery, benmosche said his priorities are to pay down debt. He said on the call, rating agencies would most like to see a few quarters of steady Profit Growth before giving basically the okay to aig to return capital to its shareholders. Even as the firm progresses toward its goals, benmosche warned that because the firm missed internal goals, bonuses will be smaller this year. Back to you. Thank you very much, mary thompson. Now, lets check in with josh lipton. What are you watching . Hey there, melissa. The fda saying they approved a new drug by roach, now pays a royalty to immunogen. Its up about 1. 7 here in early trading. After the break, two retail names shaking off the consumer warning signs. Should you add either to your portfolio. Well name some names next. Google working on a selfdriving car and computerized glasses. Apple is Holding Steady with the iphone, ipad and desktop. So is google now the reigning king of cool . A tale of two techs still ahead. May not be with fidelity, s but we can still help you see your big picture. With the fidelity guided portfolio summary, you choose which accounts to track and use fidelitys analytics to spot trends, gain insights, and figure out what you want to do next. All in one place. Im Meredith Stoddard and i helped create the fidelity guided portfolio summary. Its one more innovative reason serious investors are choosing fidelity. Now get 200 free trades when you open an account. [ male announcer ] any technology not moving forward is moving backward. [ engine turns over, tires squeal ] and youll find advanced Safety Technology like an available headsup display on the 2013 lexus gs. Theres no going back. Retail earnings, Abercrombie Fitch, a buy rating as well as nordstrom. Great to have you with us. Good morning. Did you get a good sense as to why nordstrom took down its outlook for the year . A couple things. First, nordstrom is very conservative when they provide their initial outlook. If you look back this time last year, they had very similar type of outlooks. In our opinion, this has been conservative, not indicative of a slowdown in their consumer. Whats the story with Abercrombie Fitch . They have other things going on today. One of the things investors are talking about is the change in their accounting method. Theyre changing from the retail method to the cost method. Its complicated and people are trying to sort through that right now. Why do you have a buy rating on the stock . For abercrombie, we think theres Growth Potential internationally. And domestically theyve been able to turn the business in a pretty meaningful way. In the discussion about the two particular stock stories, we havent mentioned the increase in the payroll taxes or rising gas prices. That seems to be the new thing, the new reason why analysts and companies are taking down their estimates. Will that have an additional impact on these stocks and are you concerned about this in terms of how it impacts the other stocks you represent in the sector. For nordstrom we think its more compactful. For abercrombie, its something were considering. Obviously the lower the price point, the more the consumer is impacted by gas prices. Theyre impacted by refunds coming later. And theyre also impacted by the payroll tax. What about the weather . The disruption we had in the end of last year. And perhaps more importantly, for parts of the country, its been relatively mild so far. And presumably not forcing people out to buy for colder weather. Certainly on this on an entire season basis was a disappointing winter. It didnt get cold early enough, and thats usually important for retailers. Also something thats important is that spring came very early last year. That was a powerful driver across the space. Springs dont get much better than last years. You covered the midlevel Department Stores. We dont. We just cover bondton and nordstrom. Would you think in general, though, that the payroll tax, higher gas prices, noise about the overall economy, sequester and what have you, would have a deeper impact below the level of, say, that nordstrom plays . Clearly all of those issues impact the middle income consumer. One other thing weve been emphasizing is theres about a 30 billion gap in tax refunds paid to date this year, versus last year. Thats because you could file later, or you were able to file later this year versus last year. Thats another significant headwind we think people arent talking about. Why have nordstrom shares, i dont know, theyve gone kind of sideways. I think theres still theres a lot of concern with nordstrom. Theyve been aggressively spending, canada, new york, so i think there are a lot of questions there. And investors are taking a waitandsee attitude. This is something well watch as we go forward. All right. Ed, thanks for your time. Appreciate it. Thanks. Coming up next, meet the man who turned a broken iphone into a 1 billion business. And later on, the brand behind hotel giants like marriott, sheraton and westin. Tdd 18003452550 this morning, im going to trade in hong kong. Tdd 18003452550 after that, its on to germany. Tdd 18003452550 then tonight, im trading 9500 miles away in japan. Tdd 18003452550 with the new global account from schwab, tdd 18003452550 i hunt down opportunities around the world tdd 18003452550 as if im right there. Tdd 18003452550 and im in total control because i can trade tdd 18003452550 directly online in 12 markets in their local currencies. Tdd 18003452550 i use their Global Research to get an edge. Tdd 18003452550 their equity ratings show me how schwab tdd 18003452550 rates specific foreign stocks tdd 18003452550 based on things like fundamentals, momentum and risk. Tdd 18003452550 and i also have access to independent tdd 18003452550 firms like Ned Davis Research tdd 18003452550 and Economist Intelligence unit. Tdd 18003452550 plus, i can talk to their global specialists 24 7. Tdd 18003452550 and trade in my global account commissionfree tdd 18003452550 through march 2013. Tdd 18003452550 best part. No jet lag. Tdd 18003452550 call 18007903801 tdd 18003452550 and a global specialist tdd 18003452550 will help you get started today. Transit fares as in the 37 billion transit fares we help collect each year. No . Oh, right. Youre thinking of the 1. 6 million daily Customer Care interactions xerox handles. Or the 900 Million Health insurance claims we process. So, its no surprise to you that companies depend on todays xerox for services that simplify how work gets done. Which is. Pretty much what weve always stood for. With xerox, youre ready for real business. Well, weve all been there. You break your phone and curse yourself for never bothering to back up all your data. In 2008, our next guest decided to fix the problem by starting a company, now a billiondollar business. Named to this years rio 100, africanamerican leaders put together. Great to see you. Welcome to post 9. Thanks for having me. Great back story to this whole story. It sort of goes beyond the way we introed it. Youre sitting as a musician one night. What happens . You think innovation stems from necessity, that is actually true. I was in the Radio Station 14hour days. My phone crashed. Out of pure frustration, it was formed. How about raising the capital to actually do it . It was most the most difficult things ive done in my life. It was in 2008. The Economic System in the country the timing couldnt be worse, right . It was horrible. I had to put money into the company myself until re received funding. I would imagine 2008, this is a revolutionary idea. But now the cloud is common. Im an apple user, and i back it up to the cloud. Why do i need you . The good thing about that, i love that question. Apple is all about making sure that your content stays within their infrastructure. Cyber gives the data back to the consumer. Take your content from an apple device and sync it to a blackberry or car system or internet running shoes. You name it, we allow the data to be yours. How big is the company now . We currently have 355 million subscribers, and 15 employees. Whats the revenue stream . We dont talk about that. Were private. How do you get to the billiondollars . We license our product to Major Telecommunications firms. We do revenue shares with them. So what we do is, cyber syncs, if there are 30 Million People in the telco, we get 30 Million People integrated into our software. Where did you get your individual money to at least put the seed down to grow this thing into what it is today . I was really lucky in the music business, was able to save some money up. And was married for a year and i took all the money that we had in our nest egg and put it directly into the company. Im used to eating ramen noodles and struggling here. Was it okay with your spouse . She was totally okay with it. You have a very cando attitude. From music to tech, and on that, youre launching a tv series, youre going to go out and look for entrepreneurs. Talk me through what you feel about entrepreneurism in america now, and where we could go. I think entrepreneurship is the way to go. Especially when you look at our generation. The job system really isnt there for us, the way we can generate wealth, not really talking about money, but opportunity, is to create that position for yourself. And then youre the engine that this economy needs. How do you take that into the grass roots . I dont think that you can teach entrepreneurship. Its either something you have in your soul, in your body, and what you can do is provide access to it. You can provide an opportunity for people to actually understand it. You either have it or you dont. Entrepreneurship isnt for everyone. We want to make sure its available to everyone, and everyone understands it. Whats your game plan for this company . For cybersyncs . I dont think ipo is where we want to go. Were probably looking at merger and acquisition opportunities. So a takeover target potential . Who are some of the entrepreneurial role models that you look to when you were trying to do all of this . One of my you wanted to be a musician. Its another thing to be a tech ceo. If you look at me, there are not a lot of people who look like me in the technology industry, so i had a hard time finding mentors i connected with. But scott case is one of those people that i actually did, the cofounder of priceline. Com and current ceo of the miracle partnerships. With his help, hes actually allowed me the ability to understand what my place is, as a business owner, and as an entrepreneur. Now youre the role model. I hope so. I hope so, yeah. Wonderful. Congrats. Thank you so much. Best of luck to you. Thank you. Has jcpenney struggles continues. Are jobs being cut as part of that process. Courtney, over to you. Jcpenney is now 22 days into the fouryear transformation. Theres no denying its been a tough year. The transformation shares down 47 since the first day the changes began. 950 corporate headquarter employees have been let go so far. The New York Post reported that 10 of the remaining 3,000 employees at the companys headquarters in plano, texas, have been eliminated. However, while jcpenney is not detailing exact numbers, i can confirm the job reductions are much smaller than the New York Post is reporting. I asked ron johnson about the reported layoffs on february 6th. Heres what he said. Theres a lot of rumors. We have like a rumor a day it seems like. Like today theres a rhymer about layoffs at headquarters. We would never talk about that. But youve got to separate the fact from the rumor. And ultimately we need to have the right cost structure for the business, and weve got to grow. And were going to assure we do those two things. Jcpenney said as they enter the second year, theyre making changes as the needs of the business change. We recently made a slight shift in the home office organization. Layoffs, of course, typically done as costcutting measures. Reporting Fourth Quarter earnings wednesday after the bell. Theyll find out how much the transformation has cost. A lot of questions still, courtney. Thank you very much. Courtney reagan with the latest on jcpenney. Boeing is taking its fix for the 787 dreamliner straight to the faa. But will the faa approve the fix in time to save boeings investors. [ male announcer ] to hold a patent that has changed the modern world. Would define you as an innovator. To hold more than one patent of this caliber. Would define you as a true leader. To hold over 80,000. Well that would make you. The creators of the 2013 mercedesbenz eclass. Quite possibly the most advanced luxury sedan ever. See your authorized mercedesbenz dealer for exceptional offers through mercedesbenz financial services. [ babies crying ] surprise your house was built on an ancient burial ground. [ ghosts moaning ] surprise your car needs a new transmission. [ coyote howls ] how about no more surprises . Now you can get all the online Trading Tools you need without any surprise fees. Its not rocket science. Its just common sense. From td ameritrade. Lets get to the markets and the turnaround were seeing from the twoday selloff, the worst twoday selloff this year. Where are we in fact in this market rally . Lets bring in mark, the chief investment strategist, and rod smith. Where are we . Whats your inclination in terms of the direction of the market, higher or lower . I think that its important to put this correction in context. So we have definitely been in a two steps forward, one step back market for a while. And weve been in the clear two steps forward ever since the lows following the election in november. And many of your commentators, i think even myself included, over the last little while have said, yep, weve had a really nice two steps forward. Weve gone up towards the old highs. And some suggesting if we got bad news we might get some sort of a pullback. But forren investor, this is not a bullback you want to do anything about. If youre literally a trader, you may well be wanting to raise a little bit of cash. As an investor you let the pullback happen and see if theres an opportunity following that, to either stay invested or get out a little bit. We saw the worst twoday pullback for this year. Are these pullbacks at this point that you buy, one week away from the sequester potentially kicking in . It could be a little messy over the next couple of weeks clearly because of the sequester. And of course, in late march we have the continuing resolution which could effectively lead to a government shutdown. But that said, i do think you have to buy these dips. Weve only had a 2 correction from 1530 on the s p 500. Nothing much to speak of. In fact, if it went down 3 to 5 , i think it would be healthy, and invite more moneys off the sidelines, which has probably been an overdue corrective phase in the market anyway. I think you stay long equities, because i think the scenario remains fertile for corporate profits to grow at a reasonable pace. What sectors of the market do you prefer at this point in time . Principally three. Financials, particularly regional banks, here locally in pittsburgh pnc is an example of one we like. We like the footprint d demography. Halliburton is a ben faefactor the spend sector. And technology, business spending will come forward in 2013, as i think ceos are starting to gain a little more confidence about the visibility to the economic and fiscal picture. You know, its reassuring both of you are so relaxed about whats going on. Rod, whats your view of the assumptions were making on growth . Weve spoken about it a number of times on the program. There are many who believe were able to rally on the belief growth will come back in the spring. If that doesnt materialize, then we have a problem. Where are you on that, rod . Yeah, i think that the u. S. Situation is actually easier to be more relaxed about than the overseas one. Although the overseas one is where the value is. So lets deal with the u. S. First. I do think that the i mean, lets understand what were talking about growth. Simon, you and i have had this conversation. I think were talking about small amounts of growth. But i do believe that in the last quarter of last year, the First Quarter of this year, youre going to see the slowest period in u. S. Growth and you wont see the u. S. Go into recession. Outside of the u. S. , youve had some very, very stimulative measures in japan, and there is a because that market has been the real winner, particularly if you havent known the yen, the nikkei has been on fire. I think theres a lot of expectation for growth coming through in japan. And that really needs to be fulfilled in order for japan to go much higher. And finally, youve got china. I think thats probably where the biggest change is occurring, because there was anticipation that china was going to be a growth driver. But theyre now getting worried about their property markets overheating again. And the shanghai, which has also been one of the big leading markets has fallen a lot. I think that concern is the concern over china, is more legitimate. I would back that japan would come through, that the yen will stimulate the growth and ill bet you would see the worst of the growth slow down in the u. S. And by the second to third and Fourth Quarters it will be a little bit better. Guys, thanks for joining us today. Mark and rod. Thank you. Boeing is getting ready to present a plan for modifying the 787 dreamliner lithium ion battery. Boeing says it hopes to get the planes back in service by late march. Cnbcs phil lebeau joins us now. Phil, is that an optimistic assessment in your view . It really depends on how quickly the faa makes a ruling and whether there are the lifting of contingencies. The prevention side, theres a battery redesign here. Theyre calling for separating the cells within the batteries a bit. Adding insulation. Reducing the chance of fires with those lithium ion battery packs. On the protection side, if there is an overheating, or a fire involving those battery packs, venting the fumes from that battery pack outside the plane, so they dont go in the cabin, and also containing and limiting the fire damage to that battery pack. Remember, even if the battery goes down in one of these instances, on a plane, it can continue to fly. There are other sources of power in the plane. Thats the broad sense of the proposal that boeing will be making today to the faa. The plan also calls for greater monitoring by the crews of batteries while in flight beforehand, afterwards, essentially really checking the batteries on a regular constant basis. Boeing has worked with the faa hand in hand, really, since the beginning of this issue, more than a month ago in developing these battery solutions. The faa approval, by the way, we talked with a number of people and theyre saying, listen, it could be a contingency approval, calling for more test flights. The faa said, okay, we think well eventually lift the grounding, but we want to see a few more specifics on test flights and making sure the modifications meet our specifications. Shares of boeing, since january 17th, we are now in the 38th day of this grounding. This is now one day longer than the d. C. 10 grounding back in 1979. As you see from the chart, investors have continued to stick with boeing. Its actually in a market thats arguably risen more. Phil, let me ask you about the desire that the crew check the batteries more often. Arent these batteries right at the bottom of the plane, near the landing gear . Will they be crawling around during the flights . No, no, no. Were talking about sensors and monitors and checking it that way. Were not talking about them going into the belly of the plane during a flight. Im trying to remember the bruce willis movie in which he did that and there were hijackers. For the moment, phil, we look forward to 1 30. Thank you very much. You bet. That might have been that movie air force one. Oh, yes. I completely enjoyed it. You obviously did. Lets get back to josh lipton for a market flash. Well, maybe somewhere carl icahn is smiling right now. The website ripping higher here, forecast 2013 results above what the street estimates. Analysts telling me this Company Brought in a new ceo last may. The company they say is really changing their ad strategy, effectively getting more transparency. Carl icahn, the biggest shareholder on this one. Web m. D. Up 22 right now. All right. Josh, thanks so much. Carls been quite active in doing well. After the break, find out why americas biggest lodging in Real Estate Trust is optimistic after three rival ceos. Host Hotels President and ceo joins us next. Plus, from selfdriving cars to 3d glasses, has google replaced apple with the new king of cool. The battle of the tech titans. Today is gonna be an important day for us. You ready . We wanna be our brothers keeper. Whats number two we wanna do . Bring it up to 90 decatherms. How bout ya, joe . Lets go ahead and bring it online. Attention on site, attention on site. Now starting unit nine. Some of the worlds cleanest gas turbines are now powering some of americas biggest cities. Siemens. Answers. A talking car. But ill tell you what impresses me. A talking train. This ge locomotive can tell you exactly where it is, what its carrying, while using less fuel. Delivering whatever the world needs, when it needs it. After all, whats the point of talking if you dont have something important to say . If your a man with low testosterone, if you dont have something important to say . You should know that axiron is here. The only underarm treatment for low t. Thats right, the one you apply to the underarm. Axiron is not for use in women or anyone younger than 18. Axiron can transfer to others through direct contact. Women, especially those who are or who may become pregnant, and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. Report these signs and symptoms to your doctor if they occur. Tell your doctor about all medical conditions and medications. Do not use if you have prostate or breast cancer. Serious side effects could include increased risk of prostate cancer; worsening prostate symptoms; decreased sperm count; ankle, feet, or body swelling; enlarged or painful breasts; problems breathing while sleeping; and blood clots in the legs. Common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting, and increase in psa. See your doctor, and for a 30day free trial, go to axiron. Com. With fidelitys new options platform, weve completely integrated every step of the process, making it easier to try filters and strategies. To get a list of equity options. Evaluate them with our p l calculator. And execute faster with our more intuitive trade ticket. Im greg stevens and i helped create fidelitys options platform. Its one more innovative reason serious investors are choosing fidelity. Now get 200 free trades when you open an account. To cap off a week in which three Major Hotel Companies missed or lowered expectations, including marriotts ceo on this show. Our next guest is more optimistic. The president and ceo of host hotels and resorts with a market cap in excess of 12 billion, easily americas largest lodging Real Estate Trust. Ed, thank you for joining us on cnbc. Thank you, simon. Good to be here. This is your first time on cnbc. Lets make sure everybody is aware exactly of what you do. I want to show a map of manhattan as an example. You own a huge number of very large hotels. Like millions of hotel owners, you then rent hilton. Why are you more optimistic than some of the other people in your industry . Barclays on the Conference Call yesterday said you were the most optimistic theyve heard you when theyre worried about the sequester. As i quentd to barclays yesterday, i had a feeling it wasnt so much that we were overly optimistic, it was just a bit more that people were surprised at how pessimistic some of the other folks had been. I think the reality from our perspective is, weve invested a lot in our hotels over the last three or four years, with over 1 billion of investment in our existing assets. Not new acquisitions, but our existing hotels in just the last two years. Over the course of the second half of last year, as Group Businesses continued to recover, weve been outperforming the industry. As we look at this year, while we certainly are as worried as others would be about the impacts of the sequester, issues that might come up around the extension of the debt ceiling, the reality is, the first six weeks of this year have been very strong. Revenue per available room growth, which is a statistic we use in the industry to measure performance, was up over 9 . And we look at our Group Bookings for the last three quarters of the year, our Group Revenues are projected to be up 8 . And we saw figures on that just now. Why is the west coast, l. A. , seattle, why is it doing so well . I think youve got a combination of the economy in california recovering. You also have the fact that a big factor in our business these days is international travel. Theres a lot of travelers coming in from japan, china and india, and a lot of those are coming to the west coast. Yeah. The interesting thing about the way in which you run your business, and you get a huge amount of data from those that are running your hotels. This tradeoff between price and occupancy, can you explain to people why sometimes at the margin, you will push the price slightly higher, even if you lose rooms . Sure, simon. The reality is, what were trying to maximize is the room revenues that we get from the hotel. But of course, at the end of the day, what wed like to do, if we can do it at a higher price point, it doesnt cost us any more to if we raise the rates by 10, all of that is profit. Whereas if we sell an extra room, we have the cost of cleaning that extra room. Yeah, because the biggest margin of cost to you is actually the cleaning of rooms. When you and i met when i was trying to persuade you to come on the program, we met at the westin on 42nd street. You were proud of the investment youd put in there, as i attempt to raise the value of your property to drive the food and beverage. You had an interesting choice to make in improvements. In san diego, ball rooms, 10,000square football room there. What is the tradeoff for you about investing now, to drive food and beverage and returning cash to your investors . Overall, our investment decision, whether its to invest in new buildings, whether its to invest in enhancements or whether to buy back stock or increase the dividend, its all an equation of looking at whats going to generate the best return. At some points in the cycle, which is what i would say where we are today, it makes sense to buy new assets or invest in our existing assets. Theres other points in the cycle when pricing is too high, and maybe our stock is too cheap, where it makes a lot more sense to buy the stock and really buy more of our existing company in effect as opposed to buying new assets. Just on that subject of the cycle and when properties will become more expensive, where are we on the cycle . How many years of growth in valuation do you think there are . I think this cycle is going to be much longer than the last one. The reality is that while we all would have liked to have seen stronger gdp growth over the last few years, the benefit as it were of this slower gdp growth is that new construction is still very low in the sector. Its still at levels that are less than 50 the longterm average. So until we see new supply accelerate above the longterm averages, which are slightly above 2 a year, i think the cycles going to be extended. Just before we let you go, ed, i want to talk briefly about the relationship that you guys have with marriott and hilton and starwood. You paid a percentage of your revenue to run your hotels. How would you characterize that relationship at the moment . Because in the downturn it was rough. They were saying to guys like you, come on, youre contracted to spend a quarter of a million bucks a year on putting flowers in the lobby. Clearly those days are gone. But at the margin, what do you do if, say, westin says, actually, we demand in our hotels you put a bottle of water free for every person in that room. What is the tradeoff for you . You know, i think first of all, i would say that our relationships with our operators are quite good. And i would say that if you watch whats happened over the last decade, those relationships have improved considerably, as both sides, especially the operators, have gotten more sensitive to the owners needs in a hotel. When an operator asks to add an amenity to a room, were going to evaluate it and try to decide if we think theres really a benefit, is it going to help drive more loyalty or a better rate. Sometimes we say yes. Come on, ed, you really dont want to put the bottle of water in the room because you have to pay for it. And theyre not going to buy it downstairs. In a lot of cases, thats true. Simon, one of our hotels wanted to put a manicure set in every room. We looked at them and said, theres just no way we could do that. That one didnt go through. I think what simons somewhat alluding to is in the relationship that you do have with the actual operators of the hotel, the risk is primarily on your shoulders. Just by the nature of these business agreements. Thats why theyre so liked, for lack of a better word obviously, by the marriott and the others. You have all the risk. Well, we certainly have the bulk of the bottom line risk. Now, most of our contracts are going to be set up with something called incentive management fees. So there is some sharing of the bottom line risk. We would typically have a priority return, then after that prioritys been achieved, the operator has a chance to participate in profits. And i like that element of our contract, because it really does assure that the operators going to be focused on the bottom line just like we are. Ed, you were just upgraded by s p overnight. Our senior notes were upgraded to Investment Grade. We were split rated yesterday morning, yet evening, all of our debt is now Investment Grade rated. Congratulations on that. The long climb back from a brutal 20072008 ed, thank you so much. Thanks a lot. The ceo of host hotels and resorts. Two big movers in todays action, coach, lowest level since august 19th, 2011. Also take a look at hp shares. They have moved into the doubledigit percent advance range. Higher by about 10. 5 here, almost 11 on hewlettpackard. Between hewlettpackard and ibm, they are the the big reasons why the dow is in fact higher in todays session. Coming up, a hackathon at the white house. We have the details on president obamas silicon valleylike soiree. Welcome back to squawk on the street. Its friday. Therefore, its fridays i decisi edition of the Santelli Exchange. The big issues of the day are all wrapped around debt and deficits. No matter how you want to spin it, how you want to deal with it, how you want to avoid it or how you want to get around it, these are at the epicenter. I think back, fannie, freddie, dont see many solutions. Those are called governmentsponsored enterprises. Basically agencies of the federal government that were set up and the boilerplate was, not guaranteed by the u. S. Government. What in essence they were. Now, lets think back to some of the new issues of the day, infrastructure bank. In the state of the union, the president called for this as something to build and save the country and the economy. Now, lets also look at some acronyms. Transportation Infrastructure Finance and innovation act. That will be expanded to, yes, rise of the zombie clones to create another agency very similar to freddie and fannie. Its going to be wholly owned Government Entity and its going to be the infrastructure bank. It pretty much is not going to be government guaranteed. Almost the exact same stencil of fannie and freddie. Doesnt end there. L. A. , always creative when it comes to finance. Why . Because they need the money. Okay. So theres a product called aff bonds, america fast forward bonds. Basically theyre a hybrid security thats a lot like a build america bond muni. Theres a subsidy, no technical guarantees, just like all the liability and loan guarantees of the infrastructure bank. But heres the part that really gets me above and beyond, ill never believe any of that again, is that all of this, all of this is off balance sheet, off balance sheet. So let me get this straight. How do we start out . The phrase of the day, our debt and deficits, reducing them no, no, no. The new theme of the day is to get around it. Do the same things all the banks were doing in the derivatives market, off balance sheet. Think about it. Is this a solution . Are these the kind of solutions we need . Youre going to be hearing a whole lot more of these. So buckle up. I think the zombie cage is going to have to be expanded. Back to you. Thank you, Rick Santelli. Coming up, a Company Recognized by steve jobs as one of his very favorite apps ever. Weve got the cofounder and ceo of the name phrased by jobs himself. This is 100,000. We asked total strangers to watch it for us. Thank you so much. I appreciate it. Ill be right back. They didnt take a dime. How much in fees does your bank take to watch your money . If your bank takes more money than a stranger, you need an ally. Ally bank. Your money needs an ally. You know it can be hard to lbreathe, and how that feels. E, copd includes chronic bronchitis and emphysema. Spiriva helps control my copd symptoms by keeping my airways open for 24 hours. Plus, it reduces copd flareups. Spiriva is the only oncedaily inhaled copd maintenance treatment that does both. Spiriva handihaler tiotropium bromide inhalation powder does not replace fastacting inhalers for sudden symptoms. Tell your doctor if you have kidney problems, glaucoma, trouble urinating, or an enlarged prostate. These may worsen with spiriva. Discuss all medicines you take, even eye drops. Stop taking spiriva and seek immediate medical help if your breathing suddenly worsens, your throat or tongue swells, you get hives, vision changes or eye pain, or problems passing urine. Other side effects include dry mouth and constipation. Nothing can reverse copd. Spiriva helps me breathe better. blowing sound ask your doctor about spiriva. But at xerox weve embraced a new role. Working behind the scenes to provide companies with services. Like helping hr departments manage benefits and pensions for over 11 million employees. Reducing document costs by up to 30 . And processing 421 billion dollars in accounts payables each year. Helping thousands of companies simplify how work gets done. Hows that for an encore . With xerox, youre ready for real business. That does it for us. Scott, it has been great having you for the past couple of hours. Great being here. Ill see you guys in another hour from the other side of the desk. Simon will see you for the european close at 11 30. Lets get to it. Heres what you might have missed if youre just tuning in. I think the Forward Guidance is better. The asset purchases more potent. This is a Monetary Policy that really packs a punch. Id like to see a better fiscal policy that put our tax and Spending Program on a reasonable path over the next youd like entitlement reform . Absolutely. If you did that, that would be a huge plus for the economy. Im not going to go back into a world where all i care about is italian unemployment. Just not going to go there. I worry about our unemployment. So does bernanke. 9. We really need to understand exactly what the challenges were and what the opportunities were going to be and then lay some pipe to set us up for a better 2013 in terms of products that are introduced in the market or go to market, our relationship with our channel sellers. You probably know the channel really built hewlettpackard. And then well see revenue acceleration as we go into 2014. Youre watching the opening bell. Overall, our investment decision, whether its to invest in new buildings, whether its to invest in enhancements or buy back stock or increase the dividend, its all an equation at looking at whats going to generate the best return. Made it to the end of this holiday shortened week. Good morning. Live at post 9 at the New York Stock Exchange, lets check on the markets on this friday. Dow trying to get back what its lost over the past couple of sessions. Up almost 50 points to 13,930. S p up at 1,507. Darden restaurants citing the payroll tax increase and rising gas prices. And from the restaurant sector to the tech world, Morgan Stanley saying apple is likely to more than double its dividend after the analyst spoke with peter oppenheimer. Morgan stanley saying apple can get around the issue of cash held overseas by funding payouts with debt rather than repatriation. Hewlettpackard powering higher today. The biggest gainer in the dow after last nights earning report. Hear what Meredith Whitney says. Hear what meg whitman may be saying. And is the American Consumer getting tapped out . And a company that was catapulted into fame after getting an dormant from steve jobs. Hell explain how hes trying to change the way people get their news. Were going to start with hewlettpackard. The shares are up today. Profit and revenue down last quarter. But the results beat expectations. Meg whitman telling david faber that hp is expected to see a pickup in revenue in 2014 and she does not plan on breaking up the pc and printer company. David asked her for her reaction to competitor dell potentially going private and what that means for her business. Heres what she said. Uncertainty and instability makes it hard for people to want to buy from you, particularly enterprise customers because theyre making longterm bets. When dell goes private with 18 billion worth of debt on the books, thats creates uncertainty around customer support, around future product roadmaps. Were going to use this advantage, this opportunity in the marketplace to our advantage and go after dells customers. Well get reaction later on from the analyst community. The markets trying to make a comeback. Our next guest still says the s p should exceed 1,600 this year. Want to bring in doug mckay. Doug, good morning to you. Hey, carl. What a week its been. We get the fed minutes, continued uncertainty about the degree to which q. E. Has tapered off leading those to believe who follow what we call the tepper corollary, David Teppers thoughts on the market based on expanding q. E. , where do we go now . I agree with that 100 . Too far too fast collides with the first data points in housing that arent necessarily up to expectations. Then in the afternoon you get q. E. 3 potential end date. Used to be openended. I thought, whats david tepper think about that . Thats what happened. What i think it all means is, one, i dont think the housing recovery is over. I still think its in its early stages. Its in pause. Its got to digest its gains. As far as q. E. , the good news, i think if q. E. Does come to an end, which at some point it will, it means the fed believes that the economy can stand on its own two feet. That should be a positive. When youre looking at 1,600 would be a little more than 6 above where we are now. What leads us to that . Just raw economic momentum . I think so. It doesnt have to be animal spirits. If i told you 6 was the kind of return youd see in an expansion historical, youd probably yawn. But thats the new normal. I think we gradually move up to that. I think we are finally moving into an expanding economy where early cyclicals like housing and autos are finally responding. Doesnt mean its going to be lights out. The worst kind of markets to have are those where everything is going right and apples going to hit 1 trillion market cap. Thats when you have to be worried. What is the biggest risk to that model . Is it an effect of rising Interest Rates on the national product. What is dangerous about the fed basically taking that punchbowl away . Well, it reminds me of 1994 a lot. I lived through that. And im not exactly old, not exactly young. But that was my first bear Market Experience when the fed raised rates six times. It can cause some disruptions. So people should be aware of that. Have that in the back of their mind. So these nudges from the fed are perhaps a good reminder that, watch out for bonds especially. But equities will eventually recover, even if theyre hit at first. But i think thats something in 2015. You used to be a tech manager for ten years. And to spin this to google, facebook and apple, the troika that we love to talk about so much. You have different thoughts on all three. Yeah, i own them all. Ive owned google and apple since i started my Company Seven years ago. Facebooks a new position we established around 22, 23. I think managing tech portfolios i think tech stocks are a lot like highprofile athletes. They have their moment in time. But Michael Jordan eventually retires. Nothing against Michael Jordan. But in his wings comes lebron james and then the irvings under legion james. Thats what i would paint with apple, google and facebook. Apple is kind of Michael Jordan. Its day in the sun has been great. At the end of its Growth Growth phase, its going to be an incomegenerating stock. Its a different animal. Googles lebron right now. But i dont think with 1,000 price targets thrown out there, it reminds me of 1 trillion market caps for apple six months ago and 1,000 for qualcomm. So i think google tamed the wild west internet frontier for us. But towns have been established and the facebooks for socializing the amazons for shopping and you no longer need google to get to those sites. That brings the stage for facebook. I didnt know you could still utter the name lebron james in cleveland but you certainly did. Im from akron. We still like him in akron. Doug, thanks for your time. Have a great weekend. Thank you, carl. Lets get back to washington. The president holding a White House Open daytoday hackathon today. Hes inviting developers and tech experts to come and offer ideas. Jon fortt has details. Reporter what the house is trying to do here is draw attention to the fact that theyre releasing an api that will let anybody pull data from the white house about petitions, signatures and responses. Later, theyll make the api available to make it easier to create and submit new types of petitions. The white house is taking a page from facebook and googles playbook, doing what theyre calling a hackathon to draw attention to in new open approach to data. Hackathons have nothing to do with digital burglary. In the lingo of computer programmers, a hacker is just a creative problem solver. Think macgyver. A hackathon is a track meet for software programmers. Get them together, give them a problem to solve and a time limit, maybe 24 hours, maybe a week. Give them sleeping bags, red bull, pizza, let them go. A scene from the social network here gives you the gist of a hackathon. What the white house is doing here subpoena less like a classic hackathon, a little bit more like a science fair. The engineers have had access to the api for a while. Theyre going to show what they did with it. I doubt theyll do shots. If they do, we have to get cameras into that. Thats a must. Thank you, jon fortt. Google has a selfdriving car, plus computerized glasses. Apple has the iphone, the ipad, the desktop. Is google replacing apple as the new king of cool . It is a tale of two techs. Well talk about it after the break. Rick santelli is crafting his Santelli Exchange for later on. Hey, rick. Yes, absolutely. The nfa had a meeting yesterday. The point of the meeting was to take a vote to embark on a process to banish exsenator, exgovernor jon corzine. But it didnt turn out as many floor members anticipated. Well talk about that process, what happened yesterday all from a commissioner that was there, james katuli zishgs, all at the bottom of the hour. Generate in . With fidelitys new options platform, weve completely integrated every step of the process, making it easier to try filters and strategies. To get a list of equity options. Evaluate them with our p l calculator. And execute faster with our more intuitive trade ticket. Im greg stevens and i helped create fidelitys options platform. Its one more innovative reason serious investors are choosing fidelity. Now get 200 free trades when you open an account. How do you keep an older car running like new . You ask a ford customer. When they tell you that you need your oil changed you got to bring it in. If your tires need to be rotated, you have to get that done as well. Jackie, tell me why somebody should bring theyre car here to the ford dealership for service instead of any one of those other places out there. They are going to take care of my car because this is where it came from. Price is right no problem, they make you feel like youre a family. Get a Synthetic Blend Oil change, tire rotation and much more, 29. 95 after 10. 00 rebate. If you take care of your car your car will take care of you. Industrials up higher in todays session, up more than 7 this year. Josh lipton on one name seeing big gains today. Check out Gardner Denver. The company is up for sale and it has attracted some interest. Kkr submitting a bid. Reuters reporting the takeover offer which values Gardner Denver at 7 billion, puts kkr in the position to buy the company after other private equity bidders abandoned the process. The company said back in october it was exploring options after an activist investor pressured it to sell itself. Gardner denver up 4 right now. Google, americas original tech darling, has had a steady climb up. Whats at the core of this . Jim cramer may have hit on the reason yesterday. Whatever google do is hot right now. That got us thinking. Is google steadily replacing apple as the king of cool . Lance ulanoff joins us this morning. Good morning. I tweeted and asked people would they rather own an iwatch or a google glass. Most people said google glass because it actually exists. That says a lot about where that company is right now. It exists if you have 1,500 to spend right now. Googles running a contest where you can apply to become part of the sort of expedition group. But essentially, you will only get in and then pay the money. That exists but googles pace of innovation for truly Innovative Products is sometimes rather slow. Theyve been working on this for years. No consumer is going to spend that much just to get these glasses. Very small percentage. Apples Innovative Products tend to come more quickly to market for all consumers. I think the big problem is right now that apple has not introduced a truly innovative product in three years. And you have to imagine, theyre at work on something. But Dennis Berman of the wall street journal, you put google maps on. Chrome is going a little more upscale. These glasses are apparently getting more stylish. Does apple have to answer with something truly phenomenal . We have to recognize the google efforts for what they are, which is effectively marketing. Its very good marketing. You guys are showing the video, its a very cool video. Whether it actually at this point as a relevance to peoples lives is a bit overstated, i think. But theyre very good at marketing themselves as being the people who are creating these kinds of products. I think the real question is from a financial standpoint, how is google performing to not to microsoft but to apple. Apple makes three times the revenues. Googles margins are better right now. I think the question overall is whos really building the better eco system . And right now, i think youd have to say apple is still a touch ahead. But google is gaining. Right. Lance, you probably agree with that, right . No ones going to come along and knock ios off its perch with one fell swoop . Aeverybody says google has this product that you can get. But we talked about the price. If marketing were the key to success success, everything that microsoft is doing right now would be a huge cess. And thats not happening. You have to look at the physical products, the design, the innovation, the eco system, apple continues to say they sold millions of ipads and iphones last quarter. Google is still trying to work its way into some of these categories. The chrome book pixel is exciting but its not a success yet. Googles big success, search, android, web browser which it beat microsoft on. I dont think right now google is cool and interesting but it hasnt blown away apple. Dennis, how long can google give away or essentially give away the razor blades down the line . With the greatest profitmaking machine of all time, its not the razor or the razor blades. Its called the search query in the Google Search box. Theyre willing to subsidize the losses of motorola so it keeps the android eco system and that Google Search option open and available for those doing mobile searches. And thats whats taken us to 800 . Is that a legitimate reason to be at 800 a share . Part of it is about keeping that search query and the search business fresh and germane and its doing that right now. I think what youre getting with youre buying google stock, youre getting a little bit of the upside of the product set, as lance mentioned, the chrome book, glasses, a potential down the road. And were seeing the motorola and android products come into being, too. As it moves into a Hardware Company yushgs buying on the option on the idea that they can penetrate that market overall. Its worth a few dollars per share for certain. Is this how people talk about google in the tech world . Out west, are they mentioning that theyre gaining on apples spot . I think people see the power that google has. I think they recognize that they not only solved search but theyre in every mobile more mobile devices than apple is currently in. Thats mobile is the key to success for so many companies. But as ive written, you dont count apple out. I dont believe that the iwatch or even the apple tv is necessarily the eyepopping innovation that were going to see from apple, the thing thats going to turn heads this year. I think those are probably on the big whiteboard in the back room. But ive often believed Something Else is up their sleeves. Whatever people are saying about google by the way, they still have mixed feelings about google because of the socalled they know everything about us, i think people have an affinity for apple and its products that is at a different level. Weve asked for a look at that whiteboard. Theyve not given it to us yet. Guys, thanks again. Still ahead, the late, great steve jobs called this app one of his favorites. After the break, we have the cofounder and ceo behind jobs praise. Plus, the italians are set to head to the polls this weekend. If you think that doesnt matter to you, think again. Well go live to rome with a look at why the election matters so much to the Global Markets. Dont go away. [ male announcer ] this is not my home. There. I said it. They dont have pictures of my kids. They dont have my yoga mat. And still, i feel at home. Could it be the flat screen tv . The not so mini fridge . The different free dinner almost every weeknight . Or maybe, its all of the above. And all the rest. Am i home . Nope. But it almost feels that way. Homewood suites by hilton. Be at home. A body at rest tends to stay at rest. While a body in motion tends to stay in motion. Staying active can actually ease arthritis symptoms. But if you have arthritis, staying active can be difficult. Prescription celebrex can help relieve arthritis pain so your body can stay in motion. Because just one 200mg celebrex a day can provide 24 hour relief for many with arthritis pain and inflammation. Plus, in clinical studies, celebrex is proven to improve daily physical function so moving is easier. Celebrex can be taken with or without food. And its not a narcotic. You and your doctor should balance the benefits with the risks. All prescription nsaids, like celebrex, ibuprofen, naproxen and meloxicam have the same cardiovascular warning. They all may increase the chance of heart attack or stroke, which can lead to death. This chance increases if you have Heart Disease or risk factors such as high Blood Pressure or when nsaids are taken for long periods. Nsaids, including celebrex, increase the chance of serious skin or allergic reactions or stomach and intestine problems, such as bleeding and ulcers, which can occur without warning and may cause death. Patients also taking aspirin and the elderly are at increased risk for stomach bleeding and ulcers. Do not take celebrex if youve had an asthma attack, hives, or other allergies to aspirin, nsaids or sulfonamides. Get help right away if you have swelling of the face or throat, or trouble breathing. Tell your doctor your medical history. And find an Arthritis Treatment for you. Visit celebrex. Com and ask your doctor about celebrex. For a body in motion. Im wanting to show you some of the latest apps that have been out. Pulse, which is a wonderful rss reader, if you havent seen it. Those few words from steve jobs were enough to put pulse on the map. At the time, the news reading app was only one month old. Since then, its grown to more than 25 million users around the world. We should note that cnbc content can be found on pulse. The cofounder and ceo of pulse joins us from stanford where he came up from this idea as a graduate student, what seems now like a long time ago. Good morning. Good morning. Listening to that sound from steve jobs, any developer would give anything for praise like that. How did that change your life and the life of pulse . It completely changed my life in an amazing way. So when we developed pulse, we were just students here a stanford university. And we built this app as part of a class project. It wasnt meant to be a company. It wasnt meant to grow into 25 million users plus. We were still in school and we had no idea when steve jobs mentioned us as pulse as one of his favorite apps in one of his keynotes, that was a turning moment for us and for pulse as a company. Suddenly the small little class project at stanford is now kind of overnight becoming this app that thousands of people were downloading. And in the last two years, its really grown into one of the premier apps that people use to read their news on mobile devices. Time magazine called it one of their top 50 apps of 2011. Most apps most developers we talk to start with a free app and then try to migrate into a premium or paid app. Youve gone the opposite direction, right . Correct. Why is that . We started off as a paid application. It was one of the things we went around in cafes and asked people would people buy this app. And keep in mind we were still students. We were still figuring out how to kind of put it out there. We found that in a short span of about six months, about 250,000 people paid 4 to buy this app. By that time, we had built all the systems required to build this and people use it at scale. And we got to a point where a lot of ideas in our heads were both on the fact that your close family, your friends, people you know about who are also reading on this platform and its something you can actually discover what theyre reading and sharing. That required us to go mainstream and go big. Keeping it as a paid app was hindering that growth. We made it free by the end of 2010 and weve grown from 250,000 users to over 25 million users today. And really allowing people to connect on what theyre reading together. Thats what they call scale. You raised a good amount in your series a, total of 10 million. Youve opened a new york office a couple of months ago. What is the plan from here on out . How big can you get and can you do that being public or private . Yeah, i think for us, were just completely focused on building an amazing product that people can use. In terms of where we can go, today, hundreds of millions of people still use the browser to go to different websites, to go to different places they want to get content from. So in terms of where we can grow, i think theres still this huge market, this huge potential for pulse to really become the window for peoples content. And i think along the way, weve also experimented a lot in terms of advertising and how that should feel in mobile devices. And we have very strong pieces in terms of how that should look and feel. It should stay away from the web banner ads and these takeovers that have really destroyed the experience. We feel on mobile devices, ads should feel more like content. It should feel more engaging, something that people want to really read about. We hear about that challenge all the time. Thank you so much. Its a fascinating story. Please come back. Thank you. Thanks for having me. Belles are about to sound across europe. Well get the close with simon and talk about the week and the weekend they have ahead in a moment. To grow, we have to boost our social media visibility. More likes. More tweets. So, beginning today, my son brock and his whole team will be our new senior social media strategists. Any questions . Since we make radiator valves wouldnt it be better if we just let fedex help us to expand to new markets . Hmm gotta admit thats better than a few likes. I dont have the door code. Whos that . He won a contest online to be ceo for the day. How am i supposed to run a business here without an office . [ male announcer ] fast, reliable deliveries worldwide. Fedex. [ male announcer ] fast, reliable deliveries worldwide. Anbe a name and not a number . Tor scottrade. Ron im never alone with scottrade. I can always call or stop by my local office. Theyre nearby and ready to help. So when i have questions, i can talk to someone who knows exactly how i trade. Because i dont trade like everybody. I trade like me. Thats why im with scottrade. Announcer scottrade proud to be ranked best overall client experience. Omnipotent of opportunity. You know how to mix business. With business. And you. Rent from national. Because only national lets you choose any car in the aisle. And go. You can even take a fullsize or above. And still pay the midsize price. I could get used to this. [ male announcer ] yes, you could business pro. Yes, you could. Go national. Go like a 30 seconds away from the close for the week in europe where weak economic sentiment, not too bad today. A phenomenal survey of german sentiment. Jumping in one month more than weve seen in two years. The market appears to have reacted very solidly to that. Germany continues to power ahead as the rest of the eurozone is the european markets are closing now. If you look at the figures, you might argue it seems to be something of an overexaggerated move. Bear in mind that the data coming through is that a lot of people in europe have got systemically much shorter 50 more stock on loan and bets on the ftse have tripled and bets on the dutch aex have quadrupled, according to data we have from sunguard analytics. Theres always the possibility for short squeeze. That may be what youre seeing today after the heavy losses earlier in the week. It is a broadbased rally, despite the European Commission the eurozone will contract next year. Its interesting that we have got a rebound on the mining stocks after commodities were under such pressure earlier in the week. Let me show you where weve traded for the week overall. Youll see the top 50 blew chues are flat after that climbup and the big move lower. The bank stocks are doing well. Some of the weaker bank stocks that are exposed to the periphery of europe, Something Else very important has happened today. Its become apparent that the private banks in europe are going to return about half of what we expected to the ecb in that second reclaim of the ultra cheap money that they gave away. The ltro money, 61 billion euros. Thats a game changer for many in europe. The ecb is going to have more liquidity in the market whether it likes it or not. And those banks have to hang on to more cash than they thought. Construction companies have also gone higher today. Its put a lid on the euro. That news on the ecb reclaim, some people suggesting this is a game changer, a much bigger phenomenon for the euro than the looming italian elections because it changes your view of ecb support and arguably the state of the banks. Carl, back to you. Thanks very much, simon. He mentions the elections. Italians set to go to the polls this weekend. We want to go to rome now where we find our own michelle carusocabrera. Good morning. Reporter because they owe the world so much money, carl. Italys the third most indebted country in the world after the u. S. And japan. 1. 9 trillion euros to banks, to investors everywhere. And this election could be so inconclusive that the reforms here could stall. That worries investors that maybe theyre not going to generate enough tax revenue over the coming years in order to pay back those debts. Lets show you why this is so inconclusive. There are four candidates here in italy. Two of them have criminal convictions. We put them on the screen in a particular order. Luigi bersani is in first place. If youre a union member in italy, he is your guy. Second place, the incomparable Silvio Berlusconi making an incredible comeback, even though hes faced convictions, sex scandals, et cetera. But hes still an incredibly deft politician and much loved by a certain part of the italian population. In third place, beppe grillo. And mario monti, the current premier, he is in fourth place even though hes done a lot for the italian finances. Hes not getting a lot of credit from the italian people were having brought the finances below 7 down to 5 . Lets tell you about beppe. He is a comedian. He traverses the country in a camper. Hes the founder of what they call the five star movement. Hes unbelievable. The things he says on stage are crazy. Hes got tens of thousands people showing up at his rallies. He runs across the stage. He uses many obscenities to talk about the current politicians that are out there. And the italians who show up at his rallies love it. The video have we got the video of the rally . Okay. You can see there were tens of thousands who showed up earlier in milan this week. We expect another rally like this tonight in rome. Unbelievable, michelle. We were just chatting about only in italy, as pisani just said. Well come back to you later on, michelle carusocabrera. Want to point out the move in hp. Intraday, up more than 10 . That is a sixmonth high. The leading gainer on the s p after earnings and that interview with faber and meg whitman. Only in italy could a comedian take third place. Underneath the comedy and the funniness of the guy is a very serious vote against the existing structure over in italy. N definitely like a Knownothing Party in a sense here. Very interesting day. The volume much lighter than the last two days. We had the biggest volume in a long time as people lightened up on their positions. Today its the opposite, but much lighter volume. A nice, healthy pullback. These are the people that are in countries all over the world and they sell to many different industries. Thats what you want to look at. Look at the moves up. All up 1. 5 . These have had a terrible last couple of days. Textron, wesco, eaton. For the moment, theyre saying the pullback is fairly shallow. Ill show you the building materials. Tough week for the housing stocks as well as the building materials. Owens corning was a little disappointing. Theyre getting more than 50 of what they had in the last couple of days. Not getting much in the way of retailers. Teen retailers had a tough time. Abercrombie had cautious comments. This group has been a little bit moving sideways for a while now, even some of the big names here, the Department Stores like macys and nordstrom have been underperforming the overall market. Its a mixed week on the stock market overall, talking about the global stock market here. Down fractionally right now. Japans had a big week. Germany held up. But the rest of the world has had a tough time of it. Brazil, commodityrich company, has been down. Hong kong is down. Chinas had the worst week in a long time, more than a year, as the chinese try to find some way to deal with the overall inflation there by slowing down the property market. Anytime you try to slow anything down in china, Global Markets get a little nervous. That was the main source of the problems with the stock market. Looking what shanghai did overnight, kind of crazy. Thank you, bob. The National Futures association met to consider a lifetime ban of jon corzine from the industry. Theyre not taking any action right now. Want to get to Rick Santelli in chicago with more on that. Hi, rick. Hi, carl. This is definitely a hot topic in chicago and should be a hot topic for anybody out there interested in trading markets that have regulatory bodies attached to them, which are all markets. Welcome, james katulis. I want you to introduce yourself. Hat number one, james katulis . Director of the nfa. National futures association. Three were added, is that correct . Correct. Whats your other hat . The president and cofounder of the commodity consumer coalition. I represent about 10,000 mf global victims pro bono. Lets start with hat number one. This place has been on fire for the last week or so thinking that they were going to walk in today and see that the nfa had a vote with a majority of over 14 to begin a censure process for jon corzine due to the activities he directed that brought down mf global. But i cant say that today, can sni. I cant comment on board deliberations. You cant comment. But im telling you what, ive Read Everything there is to read. Ive heard every whisper and talked to everybody off the record. It doesnt look like any process is beginning today. What can you talk about regarding this process . People that are looking to see not to put this guy in a condition where he doesnt get a fair hearing, he isnt treated objectively. Maybe he just wasnt that smart just like none of these other people that be prosecuted with all of these issues. Maybe they just cant prove it. But what happens next . Well, my hat number two, my professional personal legal opinion is that hes a criminal. Theres Public Information dont give me this stuffer, jim. You give me this. But youre not standing here today you became a director on the direct platform to start this process, did you not . Yes. And i respect the fact that you cant talk about it. Does the cftc boss you guys around . The nfa was created due to the cftc, right . Explain that. All of nfas authority to bring disciplinary actions is delegated from the cftc. Okay. Did the cftc make phone calls here to stop this vote . I cant comment on that. Did department of justice communicate with the cftc . I cant comment on that either. Okay. Lets go to your other hat. What are you calling up and telling these people a year and a half later once again, i dont care if he never has an issue affecting jon corzine. I just think there needs to be some closure here for people. I agree with you. And i think d. O. J. Needs to do their job and prosecute him were out of time. Ill tell you what, if i was in your role, i dont care Whose Authority youre operating on, if you just take the vote, they could say it doesnt count but at least you did something and a process begins. Back to you. Rick, well done. Rick santelli in chicago. When we come back, Darden Restaurants warning on the quarter citing the payroll tax increase, rising gas prices. Is this yet another sign the consumer faces some big troubles ahead . Plus, in a world of netflix and amazon streaming, should the movie industry be worried . That story still ahead. But at xerox weve embraced a new role. Working behind the scenes to provide companies with services. Like helping hr departments manage benefits and pensions for over 11 million employees. Reducing document costs by up to 30 . And processing 421 billion dollars in accounts payables each year. Helping thousands of companies simplify how work gets done. Hows that for an encore . With xerox, youre ready for real business. Otherworldly things. But there are some things ive never seen before. This ge jet engine can understand 5,000 data samples per second. Which is good for business. Because planes use less fuel, spend less time on the ground and more time in the air. Suddenly, faraway places dont seem so. Far away. If your a man with low testosterone, suddenly, faraway places dont seem so. Far away. You should know that axiron is here. The only underarm treatment for low t. Thats right, the one you apply to the underarm. Axiron is not for use in women or anyone younger than 18. Axiron can transfer to others through direct contact. Women, especially those who are or who may become pregnant, and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. Report these signs and symptoms to your doctor if they occur. Tell your doctor about all medical conditions and medications. Do not use if you have prostate or breast cancer. Serious side effects could include increased risk of prostate cancer; worsening prostate symptoms; decreased sperm count; ankle, feet, or body swelling; enlarged or painful breasts; problems breathing while sleeping; and blood clots in the legs. Common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting, and increase in psa. See your doctor, and for a 30day free trial, go to axiron. Com. But we can still help you see your big picture. With the fidelity guided portfolio summary, you choose which accounts to track and use fidelitys analytics to spot trends, gain insights, and figure out what you want to do next. All in one place. Im Meredith Stoddard and i helped create the fidelity guided portfolio summary. Its one more innovative reason serious investors are choosing fidelity. Now get 200 free trades when you open an account. Halftime live from the New York Stock Exchange today. Are the fed fears overblown . Aaron gibbs tells us if you should keep buying whats working. Is the consumer trade getting crushed . Were trading the retailers and beyond. And aig beats as the new darling of the hedge fund world. But not all our traders think the company is firing on all cylinders. Big debate at the top of the hour. See you soon. Darden releasing this video message to employees after warning on thirdquarter profits this morning. Take a listen. There are a number of things that we control and a number of things that are outside our control. And i expand upon those thoughts in a memo that i sent out this morning. In that memo, i talk about where our business is today, what we think we need to do Going Forward and how all of that really plays a part in providing great Growth Opportunities for you in the future. The memo otis references includes the economy, competitors and weather as things out of the companys control. And Customer Service and advertising as things within its control. Joining us this morning to talk about that, larry miller, a restaurant analyst at rbc capital. Good morning. Good morning. Thats not the first time weve had growth worries with this company. But the stock is higher today. The view among some on the street is, what else is new . Classic buy on bad news. A lot were thinks theyd be forced to cut their dividend and they didnt. Thats primarily why the stock is, not because of the performance in the quarter here. Theres a lot of talk about the dividend. 4. 5 . To what level does that support the stock in terms of price . I think the stock probably doesnt go much below that 5 yield and that would translate to about 40. Thats the downside. Anything with a 4 handle, were in pretty good position. What is he really pointing to, these vague things that are out of their control, like the weather . Do you believe him . Our view is the payroll tax would take a bigger bite out of industry traffic than people were realizing. If you look at the numbers and assume theres an equal cutback from Consumer Spending as a reduction to the payroll tax youre losing a point to a point and a half in industry traffic. Theres certainly something to the tax refunds, thats hurting. Weather was good last year. It isnt good this year. A lot of factors creating some news out there. But the payroll tax is having a pretty big impact. If it wasnt last summer, it was the summer before where we were looking at pricing mistakes, promotional mistakes. Is there anything regarding execution that is at work here . Well, theres a lot of other issues at darden that have caused them to underperform the industry. Theyve been having troubles at olive garden. I think the crux there is that they got a little lax on providing additional value to the guest and they just taking prize. So they sort of priced themselves out of the market. Now youre in a situation where the consumer has less money. And of course the big problem with these guys is always if the issue isnt olive, its hard for the other chains to make up for it because olive garden is so big within the company, is that true . Thats exactly right. Olive garden, more than 50 of the profits. Thats where they make their money. You think its fixable. I dont have your recent report or target. I think i see 58. Is that where we are . Were going to be coming down. I think were going to be moving down to 55. But the outperform, youre going to keep that . Yeah. Its an interesting scenario with respect to the stock here. I think its a winwin. The dividend is supporting the stock. And if its not going to go down much below 40 and theyre not going to cut the dividend, theres not a lot of downside. The worst thing to get from an operating perspective, the more it forces them to cut capex, which is what investors want to see. On the flip side, if things get better, the economy gets better, theyll do well, too. Its an interesting stock thats not necessarily related to the fundamentals here. For your space, its definitely one that keeps you on your toes, no doubt. Larry, thanks so much for your time. Thanks. The oscars are this sunday. In a world where streaming companies are beginning to make their own content, what will the movie industry look like in ten years . Thats next. [ male announcer ] it was designed to escape the ordinary. It feels like it can escape gravity. The 2013 cclass coupe. Starting at 37,800. Bob will retire when hes 153, which would be fine if bob were a vampire. But hes not. Hes an architect with two kids and a mortgage. Luckily, he found someone who gave him a fresh perspective on his portfolio. And with some planning and effort, hopefully bob can retire at a more appropriate age. Its not rocket science. Its just common sense. From td ameritrade. Skyfall is up for five oscars this weekend. But the real winner could be the individual who picks up whats featured in todays Million Dollar minute. The name is fleming, ian fleming, the creator of the james bond series. The ultimate collection of flemings books is hitting the market for 1. 5 million. Each one of the copies is not only in genuinely superb condition but is inscribed by ian fleming. Most peoples love of bond starts with the films. But these 14 novels inspired it all. This notebook here, fleming was doing research for the no l novel. One of the items is this handwritten manuscript of louis armstrong. Armstrong probably sang what i think is now the most beloved and famous of all the bond songs. Maybe some years from now, well see adeles email about skyfall. Id be happy to see that now. What a treasure trove if youre a bond fan like i am. Tell me more. What else is in this . We forget this all started with books, with the ian fleming books. This is like the Rosetta Stone of the whole bond franchise. These are the books that started it all and the First Edition that is started it all. Theres a book signed by ian fleming to james bond who is actually a caribbean or ornothologi ornothologist, a bird expert. The yacht if skyfall is available for sale for 14 million. It has an ejection seat, oil sprayer and the machine guns that pop out of the headlights. People say, why are you paying millions of dollars for books. Theres Something Special about First Editions, right . There are so many wealthy bond freaks out there. The wealthy can afford their james bond fantasies. The number of yachts named after bond. Some wealthy collector will say, this is the real deal. For the real bond fan, it all started with these books and the covers the actual books are just beautiful. You have to think, the sale of these items, the timing is no coincidence, the franchise had a bit of a lull a few years ago. And skyfall is the most commercially successful yet . It is. Whats interesting is the director went back and read the bond books and that sort of darker, more conflicted james bond is really the result of him, which is in skyfall, the result of him looking at these ian fleming books, the original bond character, and going back to those roots. The books and where it all started, i think thats where the real ae traction is. Lets talk after the show. Maybe we can pool some money. The boat would be the most fun. Robert, thank you very much. We have some breaking news here out of washington regarding the sequester. Want to send it over to john harwood. Reporter ray lahood, the outgoing transportation secretary, former republican member of congress, just walked into the White House Briefing room and started outlining the consequences of the sequester cuts. Its to build pressure on republicans to compromise by agreeing to more tax revenue in a deal to avoid the sequester. Ray lahood sid 600 million is going to be cut from the federal aviation administration. The traveler should expect delays of 90 minutes or more beyond what theyre used to already in an attempt to galvanize the public and business travelers everywhere behind the white house position. They also said that perhaps 100 air traffic towers control towers in smaller and midsized airports are going to be shut down as a result of this. Thats no accident because who tends to represent rural areas that have those smaller airport towers . Republicans, both in the house and in the senate. So well see whether or not this attempt on the heels of others to warn about cuts to programs serving poor people and inner city children have some sort of an effect. But the white house is certainly trying to squeeze republicans. Republicans are resisting, theyre calling it the president sequester saying when is he going to get the congress to act senate controlled by democrats is going to consider both republican and democratic plans next week. And they both plans are expected to fail. Theres no particular solution at this moment, carl. Interesting that were watching the secretaries of the cabinet now carry some of the water that the president tried to do himself just a few days ago. Appreciate it. John harwood in washington. When we come back, were live on the red carpet two nights before the oscars. Were back after a quick break. [ whirring ] [ creaking ] [ male announcer ] trophies and awards lift you up. But they can also hold you back. Unless you ask, whats next . [ zapping ] [ clang ] this is the next level of performance. The next level of innovation. The next rx. The f sport. This is the pursuit of perfection. The f sport. Try running four. Ning a restaurant is hard, fortunately weve got ink. It gives us 5x the rewards on our internet, phone charges and cable, plus at Office Supply stores. Rewards we put right back into our business. This is the only thing weve ever wanted to do and ink helps us do it. Make your mark with ink from chase. All stations come over to mithis is for real this time. Step seven point two one two. Verify and lock. Command is locked. Five seconds. Three, two, one. Standing by for capture. The most Innovative Software on the planet. Dragon is captured. Is connecting todays leading companies to places beyond it. Siemens. Answers. There. I said it. They dont have pictures of my kids. They dont have my yoga mat. And still, i feel at home. Could it be the flat screen tv . The not so mini fridge . The different free dinner almost every weeknight . Or maybe, its all of the above. And all the rest. Am i home . Nope

© 2025 Vimarsana

vimarsana.com © 2020. All Rights Reserved.