Brands the ceo, nigel travis, will sell will tell us how the weather wreaked havoc on last quarters numbers and how hes feeling the coffee price pain. We will get his reaction when his competitor, starbucks, reports after the bell. Lets move onto to the stocks we are watching julie hyman keeping an eye on the stock. Rex you had mentioned apple and the stocks trading higher. The number of different factors with the company raising its buyback authorization. Raising it dividend and announcing a 71 stock split which many analysts say could place it in the Dow Jones Industrial average. The earnings numbers which also in particular and the companys iphone sales surging as the iphone was introduced through china mobile. Iphones a big driver but sales did disappoint. Verizon numbers are out and even though verizon numbers beat the narrativewth, over at ts earnings yesterday is that more customers are going to the phone installment plans which will be less profitable for these entities. By biomed to get an increased foothold in orthopedics and artificial joints. The price tag is 13. 4 billion. Time now for the big story. Amazon prime focus set to report in about one hour. Shares have not been doing so well since the last report. Down almost 15 . Recently, amazon and hbo signed a deal bringing hbo programming to prime members. It marks the first time hbo licensed its content to and online only subscription service. They seem to have one goal growth. It has launched its fire tv set top box, increased the price of prime and is reportedly working on a streaming and music service. Heres everything you need to know. Good to have both of you here. Will behe one thing you looking for more than anything else . I was looking margins. I like to see were just a those can spend his money and where he can invest. The film and centers, or is it new products . The operating margin is very important will stop the stock generally works well despite that will stop at the top growth story and investors have given this company and its Management Team a pass quarter after quarter but the question is always on investors minds all stop where will it end. Has been a recent pickup in the stock price and people have gotten worried that they might actually be in jeopardy. What to you think . Thats the concern and we will get some understanding when they print the numbers. Story . On still a growth people are rotating out of the name. This has been a teflon stock. It would be down in afterhours and open up and by the end of the day. People always want to own amazon. Howwe slowing down growth . Sharp is the growth slowing down . Could it slip into the teens . Unit growth the that has been slowing down and thats one of the reasons investors sold down the stock. The final bit is shipping losses. They spend 6 billion on shipping. Two dollars for every one dollar. Should they be ok if they are getting more off of amazon prime and isnt that built into the model when you are anticipating an increase in sales . A penny onany makes every dollar of revenue. They will become a transport company and fixes problem. So it is for real. What about search . You look at alibaba and the success they have had, they sell a lot more stuff than amazon. But they are not making any money off the actual sales of the goods. They are effectively a surge for all of these goods. Amazon has started to take share away from google. Like the issue here is if you are going to search for a you can go directly to amazon and amazon is trying to build that out of become a form play. They have a surprisingly platform. Every time you get the kindle tablet, is typically an ad there targeting you. Not just the actual Product Sales but Advertising Sales as well. Business. growth its a revenue stream they have not played in as much but as the user base gets eggert, its something they will focus on. Talk to me about streaming and their attempt to get more content for prime users. I think its a small deal for amazon. It makes them a little more effective and they can promote to drive users to amazon prime which drives retail business. Its a big deal for hbo because its the first time hbo has made their content available. Have kept it in the paytv ecosystem where if you want hbo, youve got to subscribe to cable. Are they trying to make a play for the netflix and hulu audience . Have beenhink they one of the most Aggressive Companies in the space, pushing into original content. Amazon is a powerful platform. Do you anticipate theyre going to deliver . Again, we have to be concerned on the top line. If you get slowing growth, investors will rotate out and because of the fact they are plowing it back into the company, it will be a while profit thereomes for the next wave of investors. Howou are doing tv much can they do. And brad stoneny wrote the everything story. You dilute theo effectiveness . Its like google. A certain percentage of their and spending every year is for the home run stuff. Amazon is at that point. I dont think they can build a better mousetrap. We need to understand mobile business. Here they are on this hardware side and the set top boxes they are doing. So much commerce will be shifting to mobile and amazon does not want to be at the whim of apple or google. If you want to mow the lawn, lets go out and build a lawnmower company. Same thing with the drone. Concerned there package growth unit is excel and faster than fedex and ups can handle. We will be watching very carefully and be chatting with you later. Coming up, shares of apple have popped today is tim cook makes moves popular with investors. One economist will tell us why russias policy is the a locked up on the west is the cold war all over again. Apple is seeing its biggest jump in two years. Shares up over 7 on the news the iphone maker announced it 30llar quarter, selling million iphones. Apple buyback announcing a seven for one stock split, making one particular investor very happy. Carl icahn tweeted after the news i agree completely with apple lost buyback. Believe we will also be happy would we see new products. Theres actually no new product frombut is it a diversion the slump or do they have innovation up their sleeve western mark joining me on the the tech analyst from Hudson Square research. Are we going to see some good tings out of the company . I think the thing to look at earnings grew 60 . Last year, they declined 60 and a year ago committee declined 18 . If you look for one reason why apple stock climbed, earnings did not just slow, they declined. Only waym here, the you will really move the needle is with a new product category. Apple has a 30 year track record. Theres a lot of Tech Companies that have that. They have to report them as separate segments in their earnings. The Share Buyback is great. They returned 21 billion. It is something he has been pounding the table for. He is extremely happy about all of it. Spending 4. 5 billion year on research and development will stop when will that translate into something we all want and we all use . Wax investors look at the cycle for apple and we just have this vague vacancy that happens every spring for the first two quarters. That is a highmargin business, the ipad. Even the watch, if its priced at 299, youve got to sell 50 million of them to add to 10 of revenue. Exactly will stop so what have they got . You also have to be concerned about the overall changes in the fund little smart phone industry. You are able to get much that her phones and the functionality gap is narrowing. The price gap is widening, which means you can get phones close to an iphone for significantly lower. Youve got to open up new categories. There are new things just like we were talking about with amazon that apple could be pursuing. They have 800 million accounts on itunes. They should be monetizing that across a number of different ways. Itunes almost feels like its a thing of the past. Who wants to own them . I just want to stream them. You heard s point. Whats a 290 nine dollar watch going to do for them . The next category trying to figure out how to move the deal is difficult. My point is thats not my job. My job is to look at the track record and 11 times earnings at 2. 5 dividend yield, you are not paying a lot. Ou are paying for the prospect we have a buy rating and we think they will deliver but its. Ard no one predicted what the iphone is going to be. No one had a tablet before. Tablets were on peoples horizons. After the iphone, they certainly were. I dont spend a lot of time trying to figure out what the product is but trying to understand what the product will be and how they can do it. Most valuable company on a u. S. List of exchange. What are the cash flows going to be in 30 years . We dont know what anybodys cash flow will be in ready years. It looks inexpensive on a ratio but its close to half 1 trillion. Let me ask you guys about this. They are doing the 721 stock split. Part of the Dow Jones Industrial average. Will that get more Retail Investors interested if it is a cheaper price point . Its just math all stop inclusion on the dow would also be a positive. I agree with on that point. Andincreased buyback doesnt move the needle in the same way ipod, ipad and the app store have done so far. Thank you, jill and. I will see you in a little bit. Coming up, aaron out economist putins old actions will end badly. In todays global outlook, we are talking about putins parentless past. President obama warned him that the u. S. Has more sanctions ready to go if he continues to defy the geneva accord. The director of the Earth Institute at Columbia University says putins provocative policies are putting it, russia, on a collision course with the west. Post for the my guest host for the hour. Lets talk about this collision course you think russia might be on. What is going to get it there . Why is this going to become a problem . What putin is doing is brazen , really very disappointing after many years of fairly cozy relations. Stabilizing and we dont know where its going to stop. Theres the crimean annexation and a lot of application and a lot of attempt to disrupt the normal politics of ukraine trying to get back on track after the downfall will stop we are in a situation where putin has gone into ukraine and the expectation is he is not done. Thisll continue territorial landgrab where he wants to have a controlling block from russia all the way to china. How does this play out . Are we going to sit by and allow this to happen . Realistically, we are not going to confront this militarily. Step did something that over a nato boundary, i think we would be on a path to disaster. Encroachontinue to into ukraine. Hes determined that russian territory. It is this reestablishment of the ussr . Rex at least in ukraine and some other places. Other parts are outside his reach, but even when we dont respond to let kerley, and im against any military response, there is going to be a breakdown. You say theres going to be a breakdown, but let me share this with you. Saint years bird is hosting a big Economic Forum or summit in may. Take a look at some of the people expected there. Weve got lloyd lang fine, head gorman,n stanley, james and the number of other companies will be represented there as well. I would say in the rethere should be a breakdown in our economic relations with russia american corporations and Financial Institutions seem to still be willing to do business. We are in this intermediate phase right now where its not clear what the intentions are or at least putin hasnt stepped over the boundary of an actual invasion. True that western financial interests and business interests in germany just want things to go on, but they will not go on. Bankers may be there, they put later there and take it out of the banks. Anybody want to put money there . They think they are going to make business. Money is leaving russia, new projects are not going forward, theres is loss of capital and capital flight, and thats youly to continue even if have the sessions, meetings and so forth. It is an economic problem. That should be what influences him back to the center. Putin needs connections with normal worldclass industry around the world for russia to have a chance. They are breaking those relations. Im thrilled to have you here for the hour. We will be talking next about income issues replacing race and affirmative action. That is next. All right, this is street smart. I am trish regan. The Supreme Court dealt a blow to affirmativeaction. The initiative in michigan is a blueprint for other states to have a band. Path paved through Family Income and Economic Standing. But does . This effectively promote diversity in schools columbiais from university. Also joining me, the director of policy analysis at a university a Research Professor at Georgetown University center of education. Great to have all of you here. Anthony, i will start with you. If we are not going to use affirmative action to create a diverse student body, what shall we be looking at . If race is no longer a factor, does raise and social economic socialdoes race and Economic Standing matter . Race does not matter unless you allow race. If you are a black kid and you go to an allblack school, we could say that you are being let in because you are going to a low income school. It sounds like the schools just want diversity. It may not the necessarily racial diversity. It may be economic diversity. The harsh reality is an is a factor unto itself. In m. Literature, it is very clear. If you are black in it is veryiterature, clear. If you are black and poor, you are more poor. I was looking through some of the statistics and basically what you see, the percentage of u. S. Students who have received 11 arereate degrees, coming from the bottom quartile. 79 are coming from the top quartile. The students are coming from families that are earning 100,000 or more. 9. 4 of the degrees are being who comeo students from families with an income of 30,000 or less. It does seem we are educating the rich more than the poor. Economicocial backgrounds play into diversity should social economic backgrounds not play into diversity . We are dividing race and income. We have the lowest social mobility of any highend come country in the world now. If you look at the sustained kids, 36 have a fouryear degree. Students, 16 . N hispanic kids, 11 . There is a tremendous divide. Yeah, there is a divide. They are reckless and this and so many other things. This is the most reactionary Supreme Court we have had in 80 years in this country. If you are a wealthy minority that grew up on fifth avenue that can buy and sell your entire class versus the kid who grew up in a trailer park in should treat to be won on fifth avenue because they are minority, they should be given preference . Take intoa is to account true diversity . That means racial diversity and economic diversity. So look at both . They are looking at both. Schools are trying to find ways to look at middleclass income, but now they cant even look at race. The door was slammed on race. To do now . They need specifically with the university of michigan they are not going to look at race anymore. What is the next best name to ake sure you are giving lot of opportunities to a broad group of people . They will have to redouble their efforts when it comes to outreach and recruitment. They will have to come up with absolutely, admittedly imperfect proxies. The Supreme Court has made it much more difficult to have racial and ethnic diversity. And there is a collapse in the share of minority kids in some of the schools already. The Law School Class as the smallest share of African American kids they have had in decades now. It is already taking effect because this went into effect in michigan a few years ago and it is having devastating effects around the country of now closing the door that had been partly opened in recent decades and now that door is closing again. Isnt there a better way to address this . Wouldnt be through social economic grounds . Doesnt this give people struggling in our society the best opportunity . That would help. Of course we are going in the opposite direction on this. Of course, we are becoming more divided by income and wealth. The Supreme Court gave the biggest boost to that. They said, let the rich give any amount to campaigns. The Supreme Court only stands up for the rich and powerful. It has no interest in the poor and it has no interest in minorities. Let me get back to anthony. As you look ahead, what do you anticipate from other schools across the country as you look at michigan and the Supreme Court . I think the truth is the american Higher Education system has become complicit in the intergenerational transmission of race and class privilege. Presently since about 1995. 85 of the white kids going to topege went to one of the 100 fouryear schools. 75 of the black and latino kids yourto open admission for fouryear schools. It is larger than that. We are transmitting divisions in race and class throughout the generations in Higher Education has become the capstone in that process. If i may say, anthonys group is doing some of the best research how do you like that, anthony . Your work is absolutely fantastic. Thank you for speaking with me. Alright, moving on here. Why America Needs a wealth task to close the income gap . Plus, these ceo of aetna is not afraid of a little cold weather. He joins us next. Income inequality is at its highest level since the 1920s and as the gap between the rich and poor and in to grow, some point to taxation to solve the problem. Whether it is tax on the megawealthy or closing loophole so the rich cannot game the system. My next guest inks it is time for those of the top to play a proper role thinks it is time for those at the top to play a proper role in the american recovery. Youre talking about a wealth task. Dire as would treat wealth differently the irs would treat wealth differently. We should close the loopholes. Why is it that some of the richest in the country get the top tax rate of 15 , the socalled carried interest. Arri