that is it for "the call" thanks for watching, i'm melissa francis. >> and i'm larry kudlow, see you tonight on "the kudlow report." and now "power lunch" is up next. >> white house economic advisor larry summers says the u.s. economy has come, quote, back from the abyss. the remarks come to the peterson institute. a federal judge dismissed an insider trading complaint

against mark cuban. the complaint involved mama.com. the guarantee corporation says it will take responsibility for the underfunded pension at nor tell network. that's cnbc.com news now. i'm julia boorstin. hello, everybody.y. it's finally a friday. welcome to "power lunch," i'm sue herrera.a. stocks are in a tug of war as the street wraps up a bullish week. the nasdaq now lower for the first time in eight sessions, but should you expect a friday afternoon rally? the trader triple play will get you ready. >> that's right, i'm michelle cabrusso-cabrera. house speaker nancy pelosi is at the time to give a news conference on the democrats' health care bill. this is fiscal watchdog says the plan isn't going to rein in rising costs, but condition tribute to rising costs.

we're going to debate the presidents plan straight ahead. >> i'm steve liesman. the president's top economic advisor says rising unemployment is a raising concern. what shape does he think the economy is in right now? i'll give you the lowdown in minutes. but first, here's what's on the menu. >> citi and bank of america holding conference calls in the wake of reporting stronger than expected results. you take out charges, people aren't so sure. both companies saying they're seeing moderation in the rate of increase in had consumer loan losses. that's the good news. i'll have more coming up. >> i'm scott cohn live, hard at work here. our parent company, general electric profits down 49% for the quarter. but the ceo says he feels good, and so should you. we'll tell you why. >> i'm phil lebeau live in boulder, colorado, with the eco boost engine.e. it offers more muscle. but at what cost?

we'll explain later on. >> and no more muzzlel here. the nasdaq calling for the first time in eight sessions.. oil is heading higher. we start with matt nesto at the new york stock exchange. matt, any way you slice it, great week. >> no question. greatest week, michelle, that we've seen really since the low in the market coming out of that trough in march. so 6.5% is where we're at now. the dow actually is very close to possibly putting in a five-day sprint.. it hasn't done that in many moons, either.. the s&p a little bit further away from possibly doing it. but it's going to make the afternoon session interesting. our big four earnings reports here today, two of the four are down. bank of america noticeably has slipped into the negative. it was higher for most of the early part of the session. ge having its worst day in six months. scott cohn will tell you more about that in a bit, and mary will fill in the blampgs on the financials, neither of which is doing a lot to move the indexes. ibm very strong here today, but materials and energy are strong, industrials are weak. and the builder is getting a big

bit from the housing starts number. let's go to midtown now in times square where it's never dull with mike huckman. >> thanks, matt. we need an assist if the nasdaq is going to pull off its first eight-day winning streak in more than four years. but google too much of a drag on this market. and the whole internet related sector, with the lone exception of yahoo, a price target raise out of oppenheimer on the back of the google earnings report. also a price target raise and earnings estimate boost for jpmorgan and apple, up almost 2%. and bio farm, a lot going on. biocrisp higher on positive flu drug data. and gilead drugs higher with johnson & johnson on an hiv aids drug. and right now, up 4% -- it's expected to come out on monday. now over to brian at the nymex. brian. >> you know, mike, we're higher by about a buck, and some traders are just scratching their heads, because listen, we have equities down, and we have a firmer dollar, two of the

trends we have been coupled with and it's not happening.g. some of the supposed bullish things going on, geopolitical, some output concerns out of nigeria, stories that the iraq government is worried that unions arereoing to try to block an oil deal between bp and a chinese company, and we also have a situation in indonesia with those explosions. domestically, we have the housing data which makes people more bullish, of course, on the economy. take a look at intraday, with cobwebs in my head, down a percent, we have gone all the way up.. i will tell you, the rest of the complex to the up side, sue. even natt gas was down, and now even that's rallied, and it is a head-scratcher when you think about the dollar and equities at this hour. >> thank you, brian. that's what we're going to be watching as we continue on "power lunch." plus, earnings, three of the biggest companies in america out with their earnings today. what do they tell us about the outlook for business? cnbc scott cohn is at earnings central with the highlights. we begin with mary thompson.

she is listening in on bank of america and citigroup. mary? >> thanks, sue. we start with citigroup because the conference call is still going on. the company earning 49 cents a share, $4.3 billion, but you take out a gain on a sale, and it lost $2.4 billion. that sale, of course, to smith barney unit to morgan stanley. company's ceo vikram pandit saying the rate of growth in consumer losses appears to be moderating. also, while the markets are still uncertain, he says that citi is increasingly an improving operating story. he says this quarter's performance basically came down to mortgage and credit card losses. of course, which had a negative impact on the company's results. and on a plus side, though, he said we may be past the first phase of the credit cycles where you have the big markdown ones on these toxic assets, because citi so you markup in the toxic assets. bank of america, also reported better than expected earnings results, a lot of gains charges in there, a noisy quarter for it. but this is some of the things

mr. lewis had to say. specifically about repaying the t.a.r.p. he says, of course they have the desire to repay t.a.r.p. sooner rather than later. $45 billion in t.a.r.p. funds of lent to them. lewis says they don't expect to be able -- they will be allowed to repay all of the t.a.r.p. funds all at once. and he says -- he said, but they are in noer negotiations with the government right now. again, they are uncertain about the environment, the second half earnings, he says, not expected to be strong -- as strong, i should say, as the first or second quarter. now let's go to scott cohn for more on ge. scott? >> thanks, mary.. a lot of the same pressures the banks are dealing with are the pressures ge is dealing with. a 49% drop in profit for ge speaks for itself. in case you didn't get the message, jeff immelt kept saying it is a challenging environment. nowhere more so than ge capital where profits were down more than 80% from a year ago. but immelt feels good as they continue to rein in and reduce exposure to commercial real

estate. that last $237 million last quarter alone. ge increasing reserves for commercial real estate losses by $175 million.n. the question, according to a number of analysts, is whether that's enough. and chief financial officer keith sharon acknowledged they're very cautious about the reoutlook, in general.l. but insisted it is well positioned to the point why jeff immelt says the company has a chance to play offense in the second half of the year if only there were deals to do. other big drag on earns is nbc universal. while profits are up, thank goodness at cable companies like cnbc, local advertising is still hurti hurting, so as a whole, nbc universal ro profits, down an ugly 40% from a year ago. couple other things, they say that delinquencies in areas like consumer lending and industrial lending are trending below forecast. so that's a good thing. and also, jeff immelt said stimulus money, not really coming in yet, although the company is lined up to take part

in a lot of projects. steve? >> scott, can we repeat, profits up at cnbc? just -- you know, so we're out there in front, right? >> right. >> we're the atlas. >> the whole cable area, actually, sue. cnbc, msnbc, all doing well. >> all us, scott.t. >> it's all you. >> steve? >> all right, thanks, scott. cit fighting for survival. cnbc's david faber joins us. david, last we heard from you, they were on track, you thought, most likely scenario, towards bankruptcy. but there was still these negotiations going on on the side. any revolutions either way? >> no. steve, based again on the conversations i'm having with any number of people who are both close to the company and also potentially thinking about investing in some sort of financing, the expectation i would say is still more likely than not that they file chapter 11. that being said, on wednesday night, and speaking of people again close to the situation, there was an indication that our -- or an expectation that a filing might be likely today. that seems to have abated a bit.

the company, as i reported yesterday, still trying to line up for what would be a secured financing, as much as $3 billion. but there is another path that's also being followed. pitched to the same investor base, namely a debt-earned investor financing, as much as 3 to $4 billion, according to sources i'm talking to who were trying to put something like that together. the one thing we don't know n here, how quickly are they running out of money at cit, how much time do they have? >> 40% pop, though, in the stock. i know you're balancing all of this stuff, but is there anything in what you know to justify this 40% rise up to 16 cents? >> again, there hasn't been a chapter 11 filing. we -- >> well, that's something to hang your hat on. >> well -- >> it's an option.. >> is there going to be a restructuring, then you can assume that equity is going to be wiped out. >> the equity is wiped out, so you lose 57 cents a share if you buy it right now. but again, if, in fact, my

sources, you know -- it's a better than 50/50 chance, but there is some chance they manage to pull something out here, then, of course, there is going to be potentially some equity value left. >> i can make that bet. >> the key is the bonds and that's where you really want to focus. they have also rallied a bit. but take a look. this is the kind of stuff going around in terms of recovery value that distressed investors will be looking at.. it's funny, the same people who own the bonds in the capital structure are being approached about a secured financing either out or in bankruptcy. but that gives you some sense the recovery value on various assets. and then you have to discount that $28.78 billion. and you have $30 billion in unsecured out there. discount it yet again over, what, a two year period, given the time it would take to get your money back and you get some sense as to what is going on. no truth to jpmorgan, as far as i've been aware, of actually trying to buy anything out of the company. they seem to be one of any number of firms that may participate in some sort of -- >> it's going to be another one

of those weekends for cit. >> looks like it. >> thank you, david, very much. meanwhile, president obama's top economic advisor larry summers taking questions about where he sees the economy heading.. steve was listening into that q and a session. what did you hear what was surprising to you? >> trying to stay on track with this idea that the u.s. economy has backed away from the abyss. actually, to quote him directly, and that the progress has been made in rescuing the nation. he says unemployment is a major concern for the administration. and let me try a couple larry summers' double negative. he says the rise in had unemployment is not evidence that stimulus is not working. summers says he expects positive growth this year. >> factors supporting growth include the growing impact of both fiscal stimulus and measures to support the financial system. the wealth effects of stronger asset markets. inventory replenishment, and the replacement cycle for automobiles and other consumer durables.. >> the kind of grammar they teach us. double negatives.

>> the economy should be more expert-oriented, that's an affirmative statement. stocks investors get sobering news on earnings as this week's rally a jeopardy in tech force. >> a news conference in 20 minutes about the health care bill. congress's chief money watchdog says the health care plan will not rein in rising costs, and instead will contribute to them. the administration says, though, fixing health care is a critical part of the recovery plan. we're going to debate it in the power grid. and later, we're going to talk deals on wall street and the potential hot spots.. and the "fast money" halftime report, waiting in the wings as well. "power lunch" back in two minutes. we have a slight advance in the dow. just one point.

the earnings coming fast and furious next week. take a look, amazon, microsoft, apple, mcdolds, caterpillar on the docket. profits or losses, et cetera, earnings have powered the markets this week. will it continue next week? >> and that is the question.n. it's still early, of course, in the earnings season.. but so far, so good with the exception of a couple components today. will those continue to help the stock market rally? let's gather our task force for "power lunch" with their thoughts. joining us is bill stone, chief investment strategist at pnc wealth management and todd coleman at mf global.

what's your verdict, so far so good with the exception of a couple stocks, our parent company getting hit today, but overall, are you generally pleased and will the market continue to be able to muster some gains? >> i think definitely you have to be generally pleased. cost-cutting is driven, most of it, but we have seen a few top-line beats. it's tough to have revenues actually grow in an environment particularly the second quarter gave us of just a horrendous global economic environment. but i think you continue to make the story of e getting less bad and things moving in the right direction. >> todd, what about you? any reason why you might think this rally is in jeopardy here, as we go into another round of earnings? >> well, i think this week the market came set up looking for less than great expectations from the banking sector.r. and obviously, the market was wrong. i think the initial move in the s&p from the -- up through 900, earlier in the week, was more of a short cover than it was new long. so i think the market was caught off guard, a little surprised. but the fact that earnings have come in on the more positive side is a good thing, moving

forward. but like i said, it's very early, and the banking stocks have made money based on their balance sheet rebuilding, i.e., with a steeper yield curve. so i think that we get some of these other consumer-driven stocks next week, that's going to be a key. >> it seems like, bill, every time we reach these lofty level quotes, at 8700, the market retreats quickly. it feels like we're up there longer before we have fallen off. is that the right sense? as i look at some of these things here, it looks like we're a little more staying power inside where we are now. >> i think the way we have tried to talk about it is maybe that we probably are going to grind higher, it's kind of two steps forward, one step back. and hopefully, we spend a little bit more time, as you said, on the two steps forward portion. but as the kind of macro environment is -- is more favorable, too. >> but technology has been one area that everybody has been pointing to. and indeed, we have seen some pretty good results.s. but will that continue? can tech continue to drive the overall market, bill? >> well, i think the good news

is, and this to me is one of the biggest things of this particular earnings season, as much as the financials had a nice hand in it, was we got some better than expected outlooks out of some of these -- particularly the technology stock side of things. so to that point is, yes, i think you've got an opportunity for the tech. you know, google kind of notwithstanding there to kind of keep leading things for the moment. >> all right. thanks very much, bill and todd. >> thank you. coming up next, vice president joe biden says if we don't pass the democrats' health care plan, the united states will go bankrupt. but congress's fiscal watchdog says if you go ahead with the plan, we'll actually get deeper in the hole.e. who is right? watch the sparks fly on "the power grid." >> plus does the great recession have us downgrade to go less expensive hotels? chains like comfort inn and econ owe lodge. we'll give you his view on the economy and the lodging sector. it's a "power lunch" exclusive, and we will be right back. one f.

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one of the biggest movers in the s&p 500, american international group, aig. it's up 1.06, but that's equivalent of a better than 8% gain. the price on aig now, $13.82.

michelle. >> this is a live picture, sue, of capitol hill, where just moments from now we're going to hear from house speaker nancy pelosi, along with other leaders. they're holding a news conference on health care reform. vice president biden says passing it now is crucial or the economy will go bankrupt. meantime, the congressional budget office saying the president's plan will not control costs at all. who is right? you guys know the rules on the power grid, 20 seconds to make your case. steve, let's start with you. who is right, the congressional budget office or joe biden? >> well, i think i would trust the cbo. i mean, do i need to list all of the buffoon re that comes out of joe biden's mouth, saying the only way we stay out of bankruptcy is to spend more money is lunacy. but it's typical of this administration, they'll say anything. the cbo also said 30 million people will still be uninsured in ten years, so it's not going

to insure everybody. it's going to cost more. let's do it! >> julie. >> well, the long-term entitlements of medicare is going to bankrupt this country if we don't do something to cut down on the costs. secondly, what joe biden was referring to were two different things. the cbo was talking about the house and the senate health h committee plans. we have yet to see what the senate finance committee comes back with, i think it will be revenue neutral and cost neutral. >> that means they're going to tax us to death. >> no, that's not what this means, at all. >> i can't wait to see what pelosi says today. yesterday she said even if we wind up making money from the medical overhaul, we're going to take that tax money that we're going to tax the rich on it put it towards the deficit. so that tax will always stay, even if we don't need it anymore.e. let's see what gem comes out of her mouth today. >> here is the situation as we stand right now, not the hyperbole -- steve, we all pay $1,100 per family, those of us who are insured pay to to --

>> i've got to interrupt you. breaking news, scott cohn. scott. >> thank you, michelle. the justice department is asking for a stay of discovery in the s.e.c. case against stanford d financial group. this is fairly common when you have parallel civil and criminal investigations. the justice department says in a motion just filed in dallas, that it would give the discovery -- the defense is allowed to conduct discovery here, it will give them some peek into the government's evidence in the criminal case. but the potential here is that it will delay things further for the alleged victims in this case. many people have had their assets frozen since february when the s.e.c. filed suit. and in the criminal case, the judge in that case has just approved an unspecified delay in a trial that was supposed to start on august 25th. they won't set the new schedule until august 17th. so the effect here is that things have slowed down now considerably in the legal proceedings in the stanford

case. that can't be good news for the alleged victims. guys? >> back to julie and steve. steve, medicare is such a problem, but to many people who look at what's going on now, it seems like this bill is about more of medicare for everybody. >> actually, not at all. if you look at the various plans being proposed, it's not at you will. what it does is cut down on health care spending, including medicare spending. it allows you to keep your health care, if you like it. and what it does is allow people who no longer have access to health care because of unemployment -- >> julie, you touched on medicare spending because essentially it's going to take away medicare funding. doesn't that lead to more and more doctors dropping medicare patients? >> not at all. what it does it essentially doctors -- look, the bottom line is this. >> the facts julie -- fewer, fewer doctors cover medicare.. >> no, listen, the bottom line is people will have options to the public option. they will be entitled to health care. >> let me tell you something. investors business daily pointed out, everybody should see this, page 16 of the health care bill.

once the bill is enacted, no one will ever be able to join up with a private insurer. anybody who doesn't have insurance or changes must go to the public option. >> that's just erroneous, steve. you can come up with whatever conspiracy theories you want, i can find 20,000 on the web to say that the earth is flat. it doesn't mean it's true. >> this and earth is different. >> with all due respect, it isn't true. we know if you're happy with your health care plan, you can keep it. nobody is driving you -- it's a public option. >> you've got to change. and once the employer finds a cheaper option, he's going to change, julie. don't try to bamboozel us. >> steve, give me a break. right now, you can't even change employers because we're so scared of losing insurance coverage. come on! >> okay, guys, good stuff. julie, steve, thank you very much. nancy pelosi coming up in just about five minutes. >> yeah. >>. believe it or not, there are some big deals getting done on

wall street in this environment, and we're going to tell you which sectors private equity is targeting. >> plus, we are just minutes away from the "fast money" halftime report. melissa lee, what's on the "trader radar." >> moments away. flat market here, but certainly there are opportunities out there for one, mothership, general electric out with earnings, it is off today on concerns about the industrial you want. is this your opportunity to buy? and also, big tech name out with earnings next week.. the options market sees some opportunity. it is bullish on this name. we will name who it is. coming up in the halftime report. but first, more "power lunch" right after this. could someone toss me an eleven sixteenths wrench over here? here you go. eleven sixteenths... (announcer) from designing some of the world's cleanest and most fuel-efficient jet engines... to building more wind turbines than anyone in the country... the people of ge are working together... creating innovation today for america's tomorrow. thanks! no problem!

here are some of the headlines at this hour. shares of apple on the move. jpmorgan putting a price target of $167 on the stock, saying that mac sales and growing business segment for apple are big positives. earnings at matell surging, comfortably beating the street. the barbie doll maker says profits have doubled. matell keeping a close rein on costs which help to boost margins. and shares of continental

airlines down now, the fourth u.s. largest carrier, naming a new ceo. the new comes as larry anklener leaves to join a private equity firm. >> and very quickly, a picture of six flags, not the amusement park, the flags that will back drop nancy pelosi when she stands there to talk about health care reform. we'll hear from her live in a few minutes. right?t? >> this co anchoring is going right to your head. we love it. >> it's my favorite shot, the empty shot. we do the one that teases viewers to tune in. >> this is a very important news conference. >> charlie rangel, the guy who wants to charge the wealthy more than 5%. >> and threw down an aggressive deadline to get this done. that's in a few minutes.s. we need to get to our private equity discussion. a lot of those firms have been taking a beating over the past year with some of the deals. send russ stands out.

dennis and david carrie of "the deal" takes a look at some of the p/e deals. well come. dennis, i start with you. you say these are coming in dribs and drabs only but different than they used to be. they're looking at distressed d debt rather than the traditional equity position. >> it's so amazing. these guys are so adaptable. remember, just a few years ago, they were going around the world raising tens of billions of dollars to buy big targets like txu and hca and clear channel. now they're sort of back to their roots. down and dirty guys, buying up the debt.. >> that's smart, isn't it? isn't that the smart thing to do? >> that's the irony about private equity right now is that there are great opportunities to buy companies that are in an earnings fallout or just need capital. but the problem is that the private equity firms can't get funding from the banks, and they need to repair their relationships with the banks which were so fractured after they tried to get out of the deal that they struck.. >> not to mention, dennis, the relationship with their

investors, which i think is another big issue right now. david, as i understand it, when you bought private equity, you walked in for a price and you checked your liquidity at the door. how much sorrow are these investors feeling right now that they had to really -- really, they can't get out of a lot of these investments they're in? >> well, you're right. they're locked in for years. they're strapped for cash. part of the problem is that what happened during the buyout frenzy was not only were these large buyout firms snapping up companies right and left, but they were also cashing out of them and generating huge profits for lps which -- and the minnesota was continuously recycled and now that the whole process has slammed into reverse, and lps, despite the fall in the valuations of the private equity holdings are allocated in private equity, and they're pulling back and putting -- putting firms under pressure not to invest. >> sue, these were the guys that we thought were the masters of the universe.

>> oh, yes. >> the p/e guys were the guys who knew, and now they're out there. and dennis, is this just another schtick now, is that the way to look at it? is that the right way? got to come with some new thing, oh, i know something, you don't know, because i'm smarter than you. >> of course it's another schti schtick. >> but they're not the only ones doing that. there are a lot of big names on the street who have been highlighting distressed debt. >> there are. and that said, there are a tremendous amount of opportunities begin the number of companies going bankrupt. in part, those companies are private equity-owned firms. if you look at a firm like sun capital, which bought dozens and dozens of companies, the number of companies in its portfolio that have gone belly up, it's probably over ten, i think, right now. so those private equity firms are in some ways feeding their bad deals to other private equity firm investors now. >> breaking news, gentlemen.n. thank you very much. we're still waiting on that news conference, as well, but we go to mike huckman now. mike? >> sue, the food and drug administration just sent out an

e-mail a few minutes ago saying that the agency as well as teva pharmaceuticals, tick eer t-e-v at the nasdaq are calling the anesthetic drug propofol because they see high endotax i didn't know levels in this drug and the agency says it has received reports of 21 patients who have experienced post operative fever, chills and other flu like symptoms, but goes on to say that serious adverse effects include acute respiratory distress syndrome, shock and death possible with high toxin levels. so it's recalling two lots of this anesthetic, propofol. now, i am making absolutely, absolutely no connection here. but there have been widespread reports over the last couple of weeks or so that this drug may have been found in michael jackson's home, and here we have the fda and teva pharmaceuticals

recalling two lots of it because of high endo toxin levels.. >> mike, we've got a news conference going on. sorry to interrupt you. the speaker, madam pelosi is addressing reporters. >> as america's affordable health choices act moves through the legislative process, we continue to build more momentum as we go along. expressing support for america's affordable health choices act, a leading voice for america's physicians, the american medical association wrote that the legislation includes a broad range of provisions that are key to affect active, comprehensive health care system. if you don't have that letter, you should see it. because it's eloquent testimony to the merit of our house bill. and over the coming days, congress will continue working with president obama to provide stable prices, secure coverage, and quality care for all americans. we're very pleased we have the support not only of the doctors, as you saw with president obama the other day, the nurses. and is we certainly have the

support of the american people. with that, i'm very pleased to yield to the distinguished chairman of the ways and means committee with admiration and respect for the excellent work that the committee is doing and gratitude of -- to him personally for his leadership.. >> we're going to interrupt the speaker and, of course, congressman rangel and in a few moments will monitor that, but we have breaking news about what we were telling you about with cit at the top of the hour and whether or not they were going to be able to get a deal put together with multiple parties, single parties, what would it look like? cit is now saying it is in talks with jpmorgan chase and goldman sachs for a short-term financing deal. and they're saying it may be between 2 and $3 billion. >> this is all according to reuters. >> and goldman i think is the new name. we had jpmorgan out there earlier today. david was talking about it. >> whether or not they would be buying the manufacturing business -- >> sounds like financing 2 or 3 billion. >> and it's not debtor in it possession in financing.

short-term financing would not necessarily suggest debtor in possession. >> and then you have to start asking the question, if they can pull off this piece, can they then pull off a piece that the government might come in and help either through regulatory relief -- >> that's what we're going to ask. >> and/or through some form of financing. as i said earlier this week, senior treasury officials did not rule out the possibility of the government coming in, but certainly not for the bulk of this. the requirement was capital. >> we'll talk about that after the break. because -- >> more of this after the break. >> we're going to talk about that when we come back, and we have a chance to make some phone calls. welcome to the now network. currently, thousands of people

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a look at the star on cit, up 117% on that stock. that is because reuters reporting that cit is in short-term financing talks with goldman and jpmorgan. and it could be between 2 and $3 billion. >> and the key there is the short-term financing, because remember, we were discussing with david, they were negotiating for financing and some were saying maybe they were negotiating for debtor in possession financing. >> it was a single report, it's reuters saying that cit is in talks with jpmorgan chase, goldman sachs for short-term financing. we know nothing more than that. my guess is david faber is going

to confirm this story or not to make sure this -- this may be something that has been out there for a while and now just coming out. >> and you can't assume also that the stock is going to have anymore value, because the minute you get more financing, they're going to do it in exchange for something. >> there have been debt for equity swaps. but as we know, in this day and age, michelle, dilution is better than extinction. >> that is -- a very good point. >> the on going mantra of those who have survived. >> i'm sure they're going to be talking about this.. see you on the other side. >> we'll talk about cit, as well, in the next hour. see you on the other side of the "fast money" halftime report.

welcome to the "fast money" halftime report. we're getting to the heart of action as it is happening. stocks caught in a tug of war, in that ibm is in not so good news as traders rest on this ral re, we have you set up for the biggest in earnings next week. our "fast money" crew today, jared levi, and patty edwards of store house partners. first, let's discuss the cit views that broke just moments ago. a reuters report out there that jpmorgan and goldman sachs are talking to cit for short-term finance and we have been seeing the stocks basically double in the past 15 minutes or so. patty, we were talking about this issue just yesterday on softness on the news in the retail sector.

what does this mean exactly in your view? >> you know, this is huge for the mid market retailers. there are a lot of folks, dillards is one of them, and in that -- that area that they only have relationships at this point in time with cit. it could have been a disastrous holid holiday, could have seen a whole change in retailer, it would have been retail darwinism if this hadn't come through. >> at the same time, patty, we don't have of much of a reaction in the retail index, and for that matter, not much of a reaction of the insurers who have exposure to cit. what do you make of that? the fact that cit is willing to jump so much, but that the people with the most explosion, the players out there, are not jumping on the back of the news. >> well, i -- first of all, a lot of the retailers have had huge moves over the last three or four months. but beyond that, i don't think fully understood what this might have meant. i was talking to folks actually on the credit side of the business yesterday. and they were absolutely panicked about what this would mean. these were suppliers who feed

into some of these chains. >> right. >> i think it really is a much, much bigger deal than most people even realized. >> jim, is there any sort of reaction in the options pits? >> no, not really. no, this is a story that, you know, this is kind of the bad news that was hanging around in on otherwise giddy week for the rest of this week and now it was kind of ignored by the market before, which it shouldn't have been and now this good news is being ignored by the market as well. so not seeing any big deal. it strikes me as funny that the government was deciding whether or not to back stop cit. they don't to get this reputation to be the socialist government that always does it. but now goldman and jp are back stopping them, and so what's really the difference. it's like a third-hand back stop. >> i've been doing this for a long time and the market is good at finding value for their information, and i tell you if this was going to have such a big ramification to the markets and a ripple effect, i think we would see it in the retailers more. i'm sure there are a lot of smart people doing research now. -- >> you're skeptical. >> i'm skeptical.

>> let's talk about the breather in the market. bill, we were able to still be above the 930 level on the s&p 500, is that a positive given all the news we have been digesting this past week? >> melissa, you have to be bullish in the short to intermediate term. the close is still intact, challenged it last week. it held. as long as we were above 8400 in the dow and 1750 in the nasdaq comp. you have to look for places to buy. we came in this morning, looking to get long in front of 900, because i still think you get that with the s&p. >> let's talk about the mother ship for a moment. general electric, the parent company of this network, out with earnings, beating on the eps, concerns about ge capital. jim, what can you glean from this, as it relates to a specific gge trade or perhaps industrial trade out there? >> one thing about ge, remember, they have similarities with cit. a lot of the businesses in the same ones and cit having all of this trouble. and, of course, ge was going to

post bad earnings. but remember, too, that they also have similarities with the banks. and the banks can make good money in the steep yield curve environment. make it the old fashioned way, zero lending costs and lend it out at higher yield. so ge seems like something you buy off the dip, and i'm not just saying that to be the home run for the parent company. >> jeff immelt -- says that. let's move on to big stories of the day. citigroup and bank of america, trading higher after vikram pandit said consumer losses were, in fact, moderating. b of a, $4.7 billion to its credit reserves loss. patty we knew this, didn't we? >> yeah. this has all been out there. and, you know, the news about credit loss is slowing. that still means we're seeing more credit losses. i fail to see where i should get giddy about this. maybe money gets made on the short term, but this is more emotional than anything else. and show me some top line

revenue growth. i'm interested. >> let's take a look at the broader sector, and this brings us to the chart of the day. and bill, you've been looking a sector and the kril cal levels and the s&p 500 financials index. >> we talked about this and basically what i highlighted is the key to watch here. we are in a range from 11 to 13. since that june 26th show, we bottomed at 1083 and we got closer to the upper end and this will be a good proxy for not only the financials, but the overall health in the market. you can continue to trade from 11 to 13 and you break on the upside and the next major target would be 1515.50 and you back down to 9850. we are in the 11 to 13 range. >> you are staying longer? we are in the middle of 12 and 15. do you stay long through the earnings next week to hope it carries through? >> i think so.

i think look. the broader market moves higher and the fact that it is sitting this high is overall bullish. i want to err on the bullish side and we got our wand in front of 1070. we will take the profit. i think you break to the upside. >> google and ibm is higher and ibm is higher. joe joins us on the fast line and joe, i'm looking at this news and we digest on the desk yesterday. a coast control story and we make more television than that in terms of good news in the tech sector. >> the recovery out of this balance sheet recession will come from corporations. when you look at discretionary versus spending, you get great

insight from google and ibm. on the corporate side, you have google. add sales and they are not what we want them to be. look at the great numbers you are seeing from ibm in the services side. that told you a lot about what the corporation balance sheet is doing and they are spending. >> just quickly, are you a seller of google? >> keep something in mind. both the investment banks raised the price of earnings estimates on google. >> see you tonight. time for fast and furious going sector by sector to find the earnings bets. do you buy technology? >> i like technology, but i like microsoft. it's a great valuation play and i also like them getting back from apple and they are getting scared with the advertising campaign. watch for the pull back.

biotonight, what do do you? >> i talked about this. >> we just hit it the other day. i like to take my profits and i think you can get in front of 98 to move back to 9089. >> big week for financials as well. td ameritrade. >> we'll get another pop when wells fargo comes. when that happens, i think we want to sell, if you we want to be long and go with jpmorgan. it is perfect to continue to make money. >> patty, what's your consumer pick? >> like phillip morris for the international side and go long on mcdonald's because it has more upside than anything else reporting. >> tonight at 5:00, ahead of the tech names you love to trade. what to do ahead of microsoft, ebay and amazon. coming up next is one of the

biggest ce oerks o hotels and his reaction to the bombings in jakarta. back in a minute. >> earnings with the quarter. the all-stars on how to trade. john scours you tube, twitter and all things digital. what he found on microsoft before the earnings next week. the poker come back is here to stay. here's how to trade this winning hand at america's post market show tonight. hey mom i need some minutes. i just gave you some at the restaurant. yea i know. i threw them out. they were old so...... old! they are rollover minutes. they're as good as new. ya know not everyone gets to keep their unused minutes. and these days we can't afford to be wasteful.

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welcome back. we want to check the chart on shares of cit that saw a jump from reuters. goldman sacks and jpmorgan for short-term financing and concerns about whether or not retailers can buy for the

christmas selling season. you get cit askings a factor in the market. you get paid later. 60 to 90 days for them to lay out the cash and buy the inventories. a big jump in shares and not too much of a reaction in terms of the retail index and insurers that have potential exposure.. time to call the close. do you buy or sell? kick it off. >> i'm a buyer. >> last couple days with the late money coming and buying, i don't think the trend is going to stop. i'm a buyer. >> emotion to the upside and i want to see it. i'm out. >> what do you do here? >> this is a tough call.. you want to ride the train and earnings have been looking good. moving into next week, the key is protection. remain long, but if you have a company recording earnings, learn about selling or scaling back your position.

>> absolutely. cnbc.com is a great place to go for that. the biggest week for earnings is on monday from retail. we have the play by play at 5:00 p.m. eastern. the place dominating wall street, cit. what else are you working on? >> the market size well. the ceo of choice hotels, home of the comfort inn and econolodge. we will get the reaction to those bombings in indonesia and how the business is navigating the downturn. also ahead, meet the former employee going for the jackpot at the world series of poker.. are the strategies applicable to wall street and we will give you a leg up of what to expect in the market in the next week. coming up. cit group shares have nearly doubled following reports that it's in talks on short-term

financing. they are reviewing options after a federal judge dismisses insider trading against south mavericks owner mark cuban. home builder stocks after housing starts grows 3.6% to a seven-month high. that's the news now. i'm julia boorsten. welcome back to the second hour of "power lunch". breaking news on cit. in talks with jpmorgan, short-term financing could be several billion and we will debate whether the troubled lender should be allowed to fail or should be bailed out. >> some of the loss of a drug reportedly taken by michael jackson just pulled from the market, we will see if there is impact on the stock involved. >> bombings rocking jakarta.

we will have an interview with the ceo of one of the impacts that. and the economy is having on business. >> all that was ahead and we're working the cit story you call treasury to find out whether or not that may influence if they try to step in. >> let me recap the bidding. we heard earlier in the week they were back off the talks that had fallen through for overwhelming assistance. they did not rule out the government coming in if there were signs of capital being raised in addition to the financing. that's why there is a reason for caution. what seems to be talked about here is financing. that's one piece of the puzzle and the other is capital being raised. >> with what you know, would this make it a better deal for treasury or more aminable or get sheila to go back to debt? >> i think so.

it's one piece of it. let me be clear. treasury has an interest. of course you would entertain options of putting more money in to save the investment. that's part of what will motivate the treasury. they don't want to put good money in and go into a situation where the fix will not save the company. >> they have been out there saying this is a problem. if they go, you see a lot of retailers and they come up to defend the position. you have to draw the line somewhere. >> we are talking about a million customers. that's the problem. if you saw today, a story about customers and just above that, a story about how small business is angry with the obama administration. that's a part of it. when you do the numbers, it's not that much money.

3.1 trillion annually. i think about a $75 billion balance sheet from cit. more than 2%. >> it's also the time of year they are ordering for christmas and doing all that stuff believe it or not. on the market side of things, we have been up fractionally. let's get to the reporters and find out whether or not we can sustain an upside move. we start out with matt nesto. >> what's not to get excited about on the friday and a move to the tow. a little bit weaker and waiting kiss crepancy we are talking about and the movement in the dow distorting things. if you look at the sectors, we have a cyclical battle on our hands because of the ge result. the commodity stocks are very, very strong and the materials and energy among the leading

sectors, but industrials are being hauled down by general electric. if you look inside, you will see weakness in transports and boeing and ge, all trading lower and yes, we see railroads and building productions maker like masko on the rise. let's get up to mike huckman. >> we will try to see if they can build, but it's a crapshoot whether we can get here today.. you can blame google for that dragging down the whole internet-related sector with the exception of yahoo. it got a price target out of oppenheimer this morning. another rate for apple out of jpmorgan and wanted to update

you on the story we broke in within the last half hour. they are recalling and not pulling the drug off the market, but recalling two lots of the anesthetic called propothal because it could be high. this is a report of what may have been found in michael jackson's home. a spokesperson told me that the dea has contacted the company rather one lot number and that is not one of the two lot numbers that the company and the fda are voluntarily recalling. brian. >> we get to see 500 and usually a recipe for weak oil.

we are up almost 3% and it's been an impressive move. whatever the reasons might be. one trader is saying it is just on the buy side. he doesn't think it holes up and they have gotten stronger. housing starts and open markets. the fascinating up double-digits percentage-wise. they rallied on top of that. nothing major going on in the metals markets. take a look at that. basically it's going up with the rest of the commodities. >> my reports of talks at goldman up to $2 to $3 billion. will it be enough to save the company in mallory duncan from the general counsel and jerry is

a former dallas fed and senior fellow. let me begin with on our senior fellow here. should the government be involved here? >> they are already involved. a point you made a few minutes ago. one wonder fist they hadn't gotten involved in the first place whether there would be a private money solution. >> they haven't have gotten involved? >> i think they should step aside at this point. >> let the lenders take over the company. >> they are talking about 950,000 clients out there. would that be a real blow right now? >> if the credit market starts, money is tight. you have got thousands of suppliers to the retail industry who need to have operating capital if they are to be adequate number of goods on the shelves of retailers. >> all that is true, but make

the case for why the government needs to get involved. isn't that just capitalism working? >> the reason you want to have the government involve side precisely because of times like that. where the markets are askew. we can't let the retail economy which is 2/3 go down the tubes because there is not adequate funding for the supply chain. >> let me ask you this. when we add up the numbers, it's a lot of clients, but not a lot of money. why can't that money be replace bide others in the private sector and will it really matter?? will it be a blow to the overall economy? >> there is always a possibility that the government can can help negotiate a deal and find the money elsewhere. the reason we are in trouble is because of individual company who is are crucial to the supply chain have not been able to raise the money on their own. that's why cit is so important. >> sorry that the case?

do you think the credit marks are still frozen to the point where some of these companies, many of whom have a decent credit situation might not be able to get fund something we have heard it is difficult out there. >> i heard the same thing and it's a mixed bag. the reason cit is on the ropes is a lot of customers are on the ropes. as much of a victim as the close of this. we are overretailed in the united states. it's a fact. one of the things that has to happen is a shake out in the other industry. >> you make the point that these retailers will be in trouble because cit is in trouble, but cit is in trouble because the retailing customers are in trouble. it's the other way. >> they are in trouble because they are having a hard time raising money in the credit market. >> they got a lot of clients in trouble and people don't want to give them the money.

>> no. the markets are frozen across the board. it doesn't matter whether you are in the retail industry or other industry. >> we have heard that there has been thawing in some cases and not that it's not difficult, but to michelle's point, it could be the credit worthiness of the company. >> one of the things they have done is they have excellent people who can gauge the credit worthiness of the paper. they make it available based on the credit. >> considering their history, are you convinced of that. they made a lot of loans that people think they shouldn't have. >> this is what they do well. that's not involved in this issue. >> to richelle's point, the default rate on the loans are double those according to the "wall street journal" that are out there. help me out with the math. 3.1 or 3.2 trillion ex-auto retail sales.

am i wrong that the balance sheet is $75 billion and more than 2% of that? >> yeah, i think it's not credible that the failure of one lender is going to bring an industry down, but will bring a number of retailers down. again it's because that industry is oversupply and overcapacity. a lot of people who talked on both sides and a lot of people say it will have little impact, but the psychological impact on the consumer if the larger retailers do go under could be damaging at this point.t. that's one of the reasons why the government should step in. do you agree some. >> where does it end. there is always a special interest that will be benefitted. i'm not say together won't hurt main street, but it's more a reflection of what occurred on main street. >> i'm going to take a hard

right turn here. while we got you on the air, i was struck by the fact that card check has been dumped as part of the efforts by the democrats. is that pleasing to you as being part of the national retail federation and have anything to do with wal-mart agreeing to go along with health care. there is the oliver stone that asked about the relationship. >> i can't speak about the other groups, but the card check with the wrong bill at the wrong time. if it has been dumped, that's a move in the right direction. >> coming up next, another gauge in the economy with choice hotels. is the great recession causing travelers to trade down with the impact of the recent outburst of

terror that we have been hearing about overseas. the travel business might be affected. >> these are pictures from jakarta and a great week for the bulls and a huge borage of earnings. we have the triple play and the econ reconwhen "power lunch" returns. lock at the space shuttle endeavor traveling majestically in space off the coast of france and seth off with the space station shortly. today there's a way to save more for retirement,

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take a look at the home builders in the stocks. we had new single family home starts rising at the fastest rate in 4 1/2 years giving the home builders a boost today. suicide bombers in american luxury hotels in indonesia. the investigation continuing as the blasts rip through the jw marriott? jakar jakarta's business district. killing 8 and wounding 50 more. it was carried out by a terrorist group and vowed to arrest the perpetrators. the loning industry has been struggling with the recession. joining us for an interview with choice hotels and chief executive officer sheef joyce. thanks for joining us. we know you used to be with

marriott. can you give us an insight and what you think the impact is of the bombings when it comes to travel. >> obviously our heards go out to the people affected by it and this is the second time for the marriott that it has been hurt by an incident like this. what we have seen while there is short-term impact, it's a resilient culture and ownership group. they will rebuild and those hotels will recover and people will continue to travel there. that's what we have seen. you will have impact, but in general people will go back to the hotels and they will travel as they have been. >> if i can turn you to the domestic side of things in the united states, as you can tell us what type of impact you are seeing, i would think it would be positive with businesses and consumers trading down. businesses certainly have been. what kind of bottom line impact have you seen? >> we like to think of it as

value-seeking. we are definitely seeing the impact of a lessening in travel on the whole business. in our business, we are moderate here and below and the consumer while they are still travelogue the leisure side which are we are oriented to. they are seeking value and our brans are doing well. >> aren't they the higher end hotel chains lowering their prices? >> there is and has been lowering in prices in their consumer segment as well. it is not as prevalent, but there is downing going on which is a great opportunity for consumers. >> we have been distressed in the other brands. are you thinking about ak wi sigs in that space some. >> we have a brought array of brands in our portfolio.

we are not well-represented in the upscale.e. we are looking for opportunities. >> you may want to go into that area? >> if an opportunity presented itself that was attractive to us. >> in the high end. >> can i ask, if you found a property you liked, do you feel like you can get financing to do the deal? >> financing is difficult for property base, but our balance sheet is strong and we have the capacity to look at opportunities as they present themselves in this environment. >> i don't understand the capacity to look at opportunities. what do you mean? >> we have low levels on the balance sheet and access to capital to make them. >> relationships with lenders that would come through for you when making an acquisition? >> that's correct. >> tell us about the economy in general. we heard from one noted bear economist who said the worst may be over. are you seeing signs especially

le in the niche you service that the worst of this economic downturn may have ended? >> what we are seeing is things seem to have stabilized and they are down from where they were previously, but do not appear to be getting any worse. the only issue is we are not seeing any signs of things getting better any time soon. >> we hear that a lot. the worst may be over, but improvement is around the corner. thank you so much. >> can i point out the decline in the travel industry brought it down to a place where capacity is about right? >> travel works now and you can get a room where you need to get it. when it comes back, they understand there is more capacity. >> you have to get them to approve. they are so undependable. that's why we need to privatize the airports. >> that's another battle. >> you have a left hand turn. >> up next from wall street to

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>> you have been playing since you were a child, but the final table will almost be realtime. 116 days from now. you know you won $1.6 million guaranteed. how do you wait? >> i will rest and prepare. i have a once in a lifetime opportunity. i never thought about when you start the 6500 people, you think about making the money, the top 10% goes along the way. when it set in that i made the final table and they brought the bracelet, i had to take the picture and i got a chance to win this thing. i think i have a chance to win this thing and will do everything i can to prepare over the next four months. >> for has been a year 1/2 since bear. what's it been like? >> a tumultuous 18 months. it's still fresh in my memory and top the say one thing. i have friends and supporters and i haven't been able to return every e-mail.

i know they are rooting for me and i hope i represented you guys well and i'm thrilled that you guys are enjoying the fry too. >> poker has a little bit of a stigma. you mentioned you think these people were 20 or 21 and nifb investment banking had it done the same world it used to be. >> i enjoy competing and i competed against a lot of bright young people in their 20s who play online for a living and enter as part of their location. there people i would have liked to fire. i play with him several days. he is a very bright young man. a grade a. >> could he have been an investment banker? >> absolutely. he would be a dig name to a lot. >> thanks so much for joining us.. good luck november 7th at the world series of poker in vegas. michelle, she not at this point quitting his day job.

>> good for him. >> i woend r wonder if it helps deal making. >> there some similarities between the career i had and playing poker. i am fortunate that i have a great job and a great hoby and a bit of success with it. >> stay in the hobby for now. >> excellent. >> kngs crossed. >> a big week for him and the markets and a gigantic week for earnings. all that and ber nank on capitol hill. the "power lunch" trading triple play. >> we hear we are about to have docking of the space shuttle endeavor. look at the amazing pictures. live from the space shuttle. we will monitor that and bring you the event in a few minutes. back with more on the power. come on in. you're invited to the chevy open house. where getting a new vehicle is easy.

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>> per welcome back. let's check the headlines of the hour, cit up almost 100% at the

hoemt. goldman sacks up to $2 to $3 million. jpmorgan putting a target 167 saying that max sales and growing business segment for apple are big positives. they are surging and comfortably beating the street at almost 6%. profits nearly doubled and selling fewer toys. they are keeping a close on cost that helps to boost margin.. >> the dow has been up the past four days and may make it today as well. the last time the dow was up five straight days was two years ago today. joining us now from the nyse floor. at the cme, chairman of capitol market technologies and the nymex we have reilly. gentlemen, welcome to you all. we have more earnings and the fed chief talking on capitol

hill and elsewhere. what's the most important aspects. >> financials in tech. what are my guys looking at? hmos. look pharma in general.l. you look here and i will be a betting man. we are green by day's end. i will place that flag in the sand. we have unitedhealth care. that's what people are looking at. we will get the most bang for the buck. >> what's going to happen next week when it comes to interest rates. we saw the 10-year move higher as we saw people piling into stocks. the government will try to borrow did $63 billion. >> that are is the big untold story and over the course of the week, we have been looking at allocations and driving the 10-year deal up. that's almost an inverse relationship. as a question, how big is this asset allocation.

i was alluding to it. an ancillary effect is driving the yields to attractive levels. 3/4 and 4%, these are levels that he finds attractive and will be competition for capital going into equities. >> we are below $64 on oil, but not by that much. what about next week? >> we will have to climb higher and we held 60-30 two days ago and as long as we stay above here, we should go back to 67. >> what's the significance of products moving so dramatically this week some. >> that caught a lot of people by surprise. gasoline and heating oil have been higher than most expect. i think we should be trading lower, but we have been trading in a technical range and unless they sell off, we are trending with them and that will continue. >> have a great weekend. see you next week.

let's continue the conversation on citigroup's earnings report. still questions about what exactly they were saying. the stock is dropping off after an open. charlie gasparino is standing by. >> i c c figure it out. >> there a lost questions. what's going on? they did the big assets. >> that's what put them into positive territory. they will do it in pieces and get rid of the broker business in pieces. we will be watching from citigroup and like i said, i didn't understand all of it. it seemed like maybe they get the trading. they set a record to be the only firm to lose money trading when you can borrow at zero and invest it. if that's the case, citigroup debt management should be buyers. try to figure out if that is the case.

i believe he thinks things should turn around over the last two years. i think when all is said and done, this is proof positive of the failure of his leadership and ceo and the failure of the board. it's interesting because i'm trying to unpack the citigroup and unpack some of citigroup's issues and you know, it was so clear when he took over in early 2008 that they should have unloaded businesses and broke that up. what it seems is that the board of directors hired somebody that would just agree to keep the status quo. they believed in the models despite the fact that all the objective evidence is not working. you can change ceos and cfos and

how many have they had over the last three or four years. >> does anybody exist that can run city? it's so enormous, you have to climb through the ranks and know the different businesses. >> i agree with that. that is an issue. it's kind of a caretaker right now. look at this. they have good businesses and they should be doing and sold it a while back. you don't have confidence and this is a story we have to keep following and reread that earnings report. i have a hard time making sense of it. >> we are in charge of all that. let's check back with matt nesto. >> yes it is your weekly guide to investing and i like charlie going-over that citigroup report. i am also going-over the index

anomalies if you will with ibm and ge. you have seen the difference in the performance of the dow and s&p and comes down to a single stock. here's why. if you look at the heavy weight bout, look at the dow waiting for ibm. 10%. one stock and the s&p is about 2%. ge 2% and 1% for the s&p. the difference between the two companies by market cap. if you look at the audits if you will in the cap weighted versus price weighted indexing. in the dow, alcoa and ge and bank of america all are at the bottom in terms of the rank. all about 1%. microsoft ranking second. 23rd in the dow! not even on the meddle podium. if you look at the top 10 holdings and this points to people saying the dow is flawed.

listen. cap weight is perfect. 20% of the s&p with the top 10 stocks. 55% of the index in the top 10 holdings. other things you want to know about it and the higher the share price the higher the waiting. revenue and sector waiting. that's your 101. >> the waiting is the hardest part. very good. >> an ongoing contest for -- what do you want to call it? take a look at the dow. just wonder with the puzzling over the extension they have been and not weighing on the market. speaking of weighing and if you see the market starts to turn up and we have been flat to down

all day. you look around that time at 12:45 or so, the news brokerage and the financing is back on, the market did a small turn and we don't know what the number is. people are puzzling over the impact hereof cit. i think -- >> yesterday was pretty much an off day. >> i will tell you i know there is disagreement in government. over the systemic impact of cit. >> still ahead, we will talk about ben bernanke in the hot seat next week talking about the state of the economy and we will look at what he may say about where the u.s. is headed. >> remember how hary and louise shot oun president clinton's shoot for health care reform in the 90s? they're back! we will show you the different message after this. 

remember them? they are the fictional couple hary and louise as an ad campaign that derailed president

clinton's efforts to revamp health care reform.m. now they are in favor of an overhall returning to television in a $4 million ad campaign sponsored by families usa and the manufactures of america. >> we can finally get health care reform. >> it's about time. every day more and more people are fining they can't afford health care. >> they're need good coverage people can afford. coverage they can get. >> even if they have a preexisting condition. >> or lose their jobs. sounds simple enough. >> a little more cooperation and less politics and we can get the job done. >> see if hary and louise can work their same magic. i have been at an event where a lot of folks say where is our hary and louise to derail this plan. now the plan has been crafted by hary and louise.

>> can i point out hary and louise are older skpch more in the demographic of those who would favor the plan rather than those who would be paying for it. this is emblematic of the conflict this country will go through over the next several months. and years which is this demographic of the younger generation who don't need the health care. >> you say the next couple of months and i don't know if we have that long if you listen to what the house speaker said. it's a couple of weeks.s. the key question when you see the story about the cbo saying this doesn't save money. it increases cost and don't get everybody insured. does that at least slow this down and make them rethink methodology or keep democrats from joining. >> first the claim made by the obama administration that it would lower cost and say that's wrong and say they messed up. do we want to insure the

uninsure and it will one of the money. >> the premises that this would save money was not true to begin with. >> it still doesn't insure everybody. >> it never will end. it was a great thing saying the obama administration should have scaled back his agenda because of the economy. >> we said that several times. >> whether or not the agenda was too aggressive. >> written by obama. >> let's talk more about the intersection between washington and wall street. the union allegedly offered to sell an endorsement to fedex for $2 million. joining us is reporter andy bar. good to see you. lay out the quick story for us. about what was influence.

>> they put out a letter bashing u.p.s. over organizing the truckers and we obtained letters going back and forth between the american's union and fedex with david keene, the president looking for $2 to $3 million to back fedex to go and put out offense by him and other members on the group supporting fedex. obviously like a huge dust up here you hear a lot about pedalling and pay for allegations and this is a solid example. >> if this is true, we have statements saying it's not true. what would make them any different than any other lobbying group.. are they supposed to be different than a lobbying group? >> they would use kind of the support and something they tell their supporters is of

conviction and pushing conservative convictions and a lot of these people are prominent in newspapers around town. you are not supposed to be putting the column up for bid to push an idea. it's supposed to come from you as a leader. >> is this washington as usual? >> what's the fallout ultimately going to be? >> definitely a bad thing for the acu. remember these guys are the ones who run and attract dozens of politicians and groups and the huge thing for the party and conservative movement. >> for the record, they say their position is not for sale. thanks for joining us.s. >> thank you. >> earnings are not going to be the only event next week.

ben bernanke with two days of testimony on the state of the economy. we will look at what investors can expect. michael mason is chief security officer for verizon communications by day, but on the field -- his job is to secure first base. while intramural softball is part of his wellness offering, it's a big hit. >> we play hard, but everybody comes for the same reason. the camaraderie and play a little ball. >> recently the group on health named verizon one of the best employers for healthy lifestyles thanks to not just intramural sports, but helped workers stopped smoking, managed weight and preand post natal health. monica said during the game, the focus is on healthy competition.

>> i thought because i enjoyed the game and the sport, but the guys play to win. >> i'm not going to say anything.

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investors would like to hear when the fed is going to wind down the balance sheet, but will they get it? steven stanley, chief economist, will it be an exit strategy next week? >> the chairman will give us a sense of what they have in mind, but we are not there yet. we are still building at this point and key point he will want to make is we are not even close to the point where they start unwinding. >> does your sense come from the minutes? one section suggested it could be five or six years getting back to normal growth and unemployment or the neighborhood? >> that's part of it. i think another interesting passage in the minutes where they spent time with the staff presenting the balance sheet issues and a talked about a lot of things.

they didn't do anything at all in june and part is that there is no agreement. >> what do you think the market wants to hear? there is a about the of a head game going on between the fed and the markets. they are talking exit strategy and walking a different walk when it comes to the policies. >> i think the marks are worried or at least some people are worried that the fed is going to leave too much in for way too long.. there will be a massive uptick in inflation and it doesn't help that we are running a budget deficit. they can't tell us when they will do it and not going to tie their hands in that way. i don't know that they can really tell us much more than trust as we know what we are doing. >> we are watching your commendary and when "power lunch" comes back, it's oprah. losing her mojo? taking its rightful place

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