okay. another nice day for the stock market, nasdaq and stock market down. see you tomorrow. >> i will see you this afternoon on "street signs." time for "the call." the transportation department says more than 635,000 sales have been submitted by dealers under the cash for clunkers program, worth a total of $2.6 billion. shares of retailer charlotte russe up 25% following news it will be taken private. nokia will be entering the highly competitive netbookmarket and offer full details on its new offering next week that is cnbc.com news now. i'm courtney reagan. welcome to the call, i'm melissa francis. trish regan is off today. 90 minutes into the trading day,

world shares hit a ten-month high, we will discuss whether the stock rally can continue. larry? >> my word, i'm larry kudlow, hi, everybody. ben bernanke says the worst behind us, nouri el rabinny says the chances of a double-dip recession are increasing. we will discuss who is right and who is wrong. >> another 150 to 200 banks will fail because of the current credit crisis and will be joining us live with details. this is the call on cnbc. stocks moving higher in continuation of friday's rally on optimism that the worst of the optimism is behind us, not everyone agrees, including nuriel roub beanie. we will be bringing you more on that later. right now the dow up by .7 of a percent, five straight days in a row we are in the black. as for the s & p 500 up. and the nasdaq in the back. black.

>> all big three talking about earnings improving in the next years. cash for clunkers expiring today but other programs traders are starting to get interest n you know, there is cash for appliances, part of the rebate program, rather part of the stimulus program here, $a 50 to $200 rebates for high-efficiency appliances supposed to start in the next month or two, appliance shipments a horrible time, down 15% year over year, whirlpool moving up recently in anticipation of the programs. cash for houses that is

expiring, $8,000 first time home buyer tax credit, you have to close on november 30th to be part of that program, that effectively means you have to get a contract by september 30th and already a lot of talk out in washington they are going to extend that program, maybe make it more applicable to nonfirst time home buyers. trader talk.cnbc.com. rebecca, how we looking at the nasdaq? >> tech hanging in there now. positive note for the space, an upgrade for dell and you see their shares up 3.5%. the important points in this note is that companies, corporations, they can't defer their it spending forever. there are a lot of server upgrades that needed to be made and am tech speculating we will see them at 2010, positive for tech space. oracle tied 1.6% to the upside right now. meantime, apple this note over the weekend, nokia says it is going head-to-head, toe-to-toe in the smart phone space. warner chill cot, we know they

are buying up the png farmer business, what is interesting to note here is the financing. this is a levered deal and getting done. that is a positive note for deal activity across the industry. right now, you do see the shares, upside by 25%. to the red, negative side, 1.5% lower, cost cutting isn't necessarily going to pay off for this retailer, what berrens had to say over the weekend. >> rebecca jar vase, thanks. the worst of the economic crisis is behind us says bernanke but roubini who predicted the crisis is out with an op ed saying the chance of a double-dip recession is increasing who is right? bring in the chief economist at mkm partners and cnbc's rick santelli. mike, this felt political to me. ben bernanke comes out and says he thinks that is over, feels like exit strategy maybe the fed will put on the brakes, roubini

comes in and says we got to keep the stimulus going. political to you or do you buy it? >> there is always some politics laced in there. i think nourile consistent and dark. i'm afraid he missed the turn here as well. i think fed chairman ber mack ski right in terms of the economic recovery. >> rick what do you think about that? >> i think mr. roubini was smack on in terms of all the economic forces that caused the credit crisis but the market and fundamentals on the economic side are never the same, as we have learned. >> right. >> i think in terms of mr. bernanke, would anybody expect him to take any other road? maybe a little politics, at the end of the day, a w is an issue. should we have one for the fed? they are certainly not going to predict it's coming, they will err on the side of optimism. >> mike, i want to ask you something, look at the stock market patterns, united states, rest of the world with, emerging markets, those stock market

rallies are vs. now might roubini not wrong but what is the chance of a v-shaped recovery? >> growing larger by the day, larry. i mean if you believe in markets it is not just the s & p 500 that shot up over 50% from the march lows, global equity test outperformed that emerging markets are up something on the order of 80% and they bottomed out late last year. it could be something that looks a bit more like a v, not just for the u.s. but the global economy at large. >> rick santelli, on the other side of this, just to be fair and balanced, okay, the fed may not tighten again in my lifetime. you got 350 basis point curve, money supply is growing, but do you have tax hikes coming at the end of next year. lord know what is kind can of government controls we are going to have. >> how can you argue against the w? >> here is my question, isn't so much the w but can you make money now? can you make money now ahead of

these oppressive tax and spending decisions coming up next year? maybe government-controlled health care? i don't know. rick, that is the key point. the next year, can you make money now? >> what you need to do is figure out the impact of the banks and the yield curve on having less money into the system. i think it is going to keep for a steep curve but for everybody. >> steep curve mean now what's it mean? important question, what's it mean for stocks? what's it mean for banks? what's it mean for the economy? >> a layup for the banks, i will have to tell you if you look at some of the earnings bysome of the biggest banks, a lot of them really didn't put as much or gain as much profits from that, they garner profits from other positives going out in the financial world. by the way, israel raised rates a quarter point, the first tightening in terms of the world economy and i think it's something to consider. i'm not sure if it's -- a coal miner or not. >> that is the concern among economists, looking from a theoretical level, mike, a difference between market and

the economy. you could see a double-dip in the economy and we are not necessarily talking about the same thing in the market. the concern is if you take the stimulus off, we go back down. does that necessarily mean the -- >> the stimulus off? [ inaudible ]. >> academic arguments over time if you read his work. >> what they ought to do what they ought to do is take the spending stimulus off and give it back in terms of personal tax cuts, employment tax cuts, payroll tax cuts, business tax cuts. what are the chances of that? what are the chance these would do such a thing, completely take the w off the board? >> unfortunately, larry, probably zero. >> zero. >> but they are going to -- the fiscal spending is going to keep on chugging along and the fed is going to remain accommodating for an extended period of time here. the concern of policy makers is a repeat. you saw the "wall street journal" today, 1937, '38, not thinking about the '70, they are worried about this stuff. if anything, they are probably

willing to keep the pedal to the medal for a bit too long, if you will. >> what does that mean for inflation? >> ultimately it is going to go higher, but i think there is going to be a bit of a longer fuse on inflation here than maybe some of those really concerned about it i think it comes back. >> what, years two years, three years? >> two to five years out. you know, next year, i don't think you're going to, at least in the core level, core inflation moves very slowly it is mainly rents. there is no rental inflation right now. so, essentially, there will be an inflationary price tag for this but it's two to five years away. >> optimism comes true, you are going to see commodity prices ramp up. i know copper's down a bit but overnight, it was strong, "globalle recovery" israel raising rates. you could call it what you want. michael, aren't you going to be looking at some price shocks at the pump indeed if there is no double dip? >> absolutely. the commodity price inflation's already started up. >> average american, inflation and gas prices are the same

thing. >> michael darda, one of the things i liked, i didn't think roubini's piece is correct, i don't think they will take the stimulus out, i agree with you on this, but he did note the 2008 shock, $145, he called that the tipping point. i agree with that let me ask you this, with respect to the value of the u.s. dollar and the con come minute nant rise in oil, it may not be a credit risk but an oil shock risk. >> see triple-digit oil prices again, may not be next year. >> i agree. >> without question. all right. we are going to leave it there. >> triple-digit oil prices. wow, rick santelli, michael darda, thank you so much. coming up here on "the call," from the economy we go to stocks, the question on investors' minds, will the rally continue? what you need to know and how to position your portfolio for september. but first, why medical experts are looking to australia for news on how to combat swine

flu in america. that's coming up next, only on "the call." ♪ yes, you're lovely... ♪ what do you think? hey, why don't we use our points from chase sapphire and take a break? we can't. sure, we can. the points don't expire... ♪ there is nothing for me... ♪ there's no travel restrictions... we could leave tomorrow. we can't use them for a vacation. you can use the points for just about anything. i know... ♪ the way you look tonight ♪ chase what matters. get your new chase sapphire card at chase.com/sapphire.

take a look at crude oil today trading higher along with the rest of the stocks, up about 70 cents, 7459, look at natural gas, been on a tear there you can see is up another 2 1/3rd today. it is $3, i remember when it was above 15. americans prepare for the cold months ahead many wonder if

the swine flu and springtime scare will reappear in force this fall. sometimes you get an idea what is coming by looking abroad. australia is still battling the disease at the end of their winter flu season and we are of course watching to see what it's going to do out here in the states. australia has become a global case study for swine flu. within a month of the outbreak in early may, the australian city of melbourne was named the world's swine flu capital. earlier, monitoring airports and ports and closing schools proved futile. 40 deaths and some 15,000 cases later what lessons account northern hemisphere draw from australia's experience with h1n1? >> get a vaccine deechbld immune any the population as soon as possible it isn't actually possible to contain the influenza anymore than the other seasonal flus. >> reporter: complicating matters is the unofficial approach by some doctors here in australia to avoid unnecessary public hysteria. my own son had a severe flu a

couple of weeks ago, but our local doctor said he is not telling people anymore that they have swine flu. a similar approach has been witnessed in the states. >> initially, i don't think they wanted us to be labelled a swine flu family so they treated us as if we had a severe flu. no one label it had swine flu. >> reporter: however, couldn't the disease become more infectious by the time it reaches the u.s. winter? >> it's possible, however, it mutates that it could have a higher percentage of parents getting life-threatening illness as a result of the disease and possibly even low-risk people rather than high-risk people. >> reporter: possible testing is under way in australia and an aussie biotech hopes to have a sack virginia vaccine by summer. should the government initialize all plans to immunize 20 aussies this flu season? hopefully time in the united states. the question is how hard will

swine flu hit the united states? let's bring in dr. erica schwartz, medical director of synergy health. thanks for being here, dr. schwarts. >> thank you. >> what is your answer to the question? >> we have to put perspective here. let's look at the fact that the swine flu is the mildest flu around, that pandemic really means that it's global, so, it's around the world. but it's really a mild flu. if you compare the swine flu to the regular flu that we immunize people for there are fewer deaths, fewer than 1,000 deaths in the united states from the swine flu last year. >> then why is there so much fear about it? >> because we are fretting the fear there is no reason to scare people. there is nothing about this flu that is different in any mild, mild flu. as a matter of fact, the vaccination situation is pretty scary. it's scarier than the swine flu because we don't know enough about the vaccinations. there are five trials going on about the vaccine. we don't really know if it's safe because in 1976, it wasn't

safe. and we are talking about 50 million people being immunized in october when the results of the testing for the vaccine are not going to even be in until the end of october. >> so, dr. schwarts, do we just stay away from the vaccine? is that the key question, take the u.s., worried or not? you describe it as a common cold. >> exactly t is a heavy common cold. you know what if you look at it people don't die from it. people who are at high risk should take better care of themselves and the people who, like the kids who actually are more likely to get it and pregnant women should take better care of themselves. it is about safety, wash your hands, common sense instead of scaring people. there's no reason to scare people. nothing about it. >> what about the chances of it mutati mutating? >> well you know what, as much guess work as anything else. if you look for the past ten years at the regular flu vacc e vaccines we are getting, they are not covering for the flu. so, what has happened is the swine flu is kind of the birth

of a new name for a flu because the flu vaccines we're giving don't really cover the flu. >> hmm. >> i think we should put into perspective, the thing is you know what wash your hands, take care of yourself, eat right, sleep more and once you're sick, do not expose others, stay at home. >> one of the bottom lines, i'm listening to this it's hype, it's a scare tactic. >> total hype. total hype. >> the health authorities on us about this? >> i don't know. >> the thing that always bugs me, cause these great scares, people go -- they go and hide in caves under the mattresses, under their covers and it's much ado about nothing. >> exactly. you know what, we actually spread that scare because if you think about it, when it first came out we used the word pandemic, the world health organization, the cdc. >> fed it by saying it has become unstoppable. what is unstoppable? >> common cold is unstoppable. who cares? >> we have had six bubonic

plagues in the last three years, the whole story has come to nothing. >> exactly. stop being scared. wash your hands, take care of yourself. >> i wash my hands. >> wash your hands. >> i do. >> better to be safe tan sorry? >> absolutely. yes. >> cleared that up. up next, a few more regional banks go bust over the weekend. new details. police bic beauvais on why 200 more bank failures are looming. all right stock rally carry into september? what you need to know and how to position your portfolio coming up right here on the call. [ engine revving ]

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we send you a check for the difference, automatically. if you were wondering whether this rally has any legs, has legs today, the dow up by 76 points. this is now the fifth straight day in the black. larry? >> thanks, mandy. a few more bank failures were announced over the weekend, including texas guarantee bank, the tenth largest failure in u.s. history. in fact, richard bove putting out a note this morning that between 150 and 200 banks will fail, putting a bigger strain on the fdic. hampton pearson is live in washington with what the fdic is planning on doing. hello, hampy. >> good morning, larry.

81 bank failures, including 17 so far this month, the fdic is dealing with the biggest number of collapses since 1992. now, during this current crisis, the fdic has been working with acquiring banks to share in those losses. the guarantee bank collapse in texas will cost the agency more than $3 billion. in an attempt to attract more buyers for failed banks, wednesday afternoon, the fdic board is expected to relax restrictions on private equity firms, private equity firms buying collapsed firms, details worked out. as far as the fund, regulators say look for more special assessments, as was the case during the s & l crisis. >> this happened in the late '80s, and banks will be assessed to replenish the fund. that is normal reaction. i think it is important to understand that going forward in good times, in good times, we

should be allowed to make that fund much, much larger. >> remember, last year, the mortgage melt down saw the fdic dealing with, among other things, the twin collapse of washington mutual, which had some 307 billion in asset he is and indy mac at 31 billion. the fdic insures hundreds of banks and institutions around the country, most which are open, making loans, and like the rest of us, wait for the economy to recover. >> thank you very much, hampton. let's discuss more about the state of the banking industry. joining us, richard bove, financial strategist, rochdale securities and chris whalen, senior vp at institutional risk an littistic. dick bove, start with you, learning now banks are not too big to fail and might this be good news rather than such big news? >> i think there are three issues, certainly a lot of banks no to the big to fail and a lot of them will fail, three issues

tough look at. number one, a lot of small banks that will fail, somewhere between, we think, 150 to 200. number two, and this is much more important, the cost of covering those failures is going to be extraordinarily high for the healthy banks. in other words, the healthy banks may have to set aside 25% of their earnings next year to pay for the failed banks. and that's going to cause the earnings to be less than people expect. third issue is who is going to buy the failed banks? and i think that we have run out of names in the united states. u.s. bank corps would be one company but i think most of the buys are going to come from foreign banks or private equity firms. >> chris that is one of the big issues right now, you look at what the fdic is talking about article in the journal last week as well, seems to be a push to get private equity involved in investing in the smaller banks what does that mean you think that is a good idea and they will do it? >> we filed a comment letter on the rule. basically it comes down to this, we are going to run ipos for troubled banks, qualified

investors are going to be involved. firms like dick's are going to be the advisers. and i think we have to give them latitude on the control issue but i also think the funds have to put money on the table, like all blind side investors what they are saying is we are not a control party, we are not the beneficial owner of the shares there fore, you can't ask us for more money a year from now if the bank gets into trouble. that is the tough issue for the fdic and the other regulators. >> the way that private equity operates flies in the face of to everything that is trendy right now. they don't like to disclose exactly what they are doing, put on a ton of rev lage, don't like a lot of control from the government. >> they will have to disclose to investment banks. >> they can't shake it off. i don't think it is a good idea that private equity firms buy banks. >> no i agree. >> i think what we are looking at commingling the financial sector with the industrial sector and that has always been a mistake wherever it has been tried. i don't believe we should do it in this country, we are desperate.

when we are desperate, do things perhaps we shouldn't do. >> what we will see is something of a hybrid here. you have to have somebody in charge of the bank when the transaction closes. i suspect for large institutions, above 20, 25 billion in assets, that's going to be another bank. i think you will see the fdic get creative as to how they get investor involved with a competent management team, which is the key. >> chris, step away from the near term. don't we have too many banks in the country? isn't that an ongoing issue? >> no. >> if you can resolve these failures, isn't that a good thing going down the road? >> we can resolve the failures and we will, but back to the point about the industry and their contribution, i think it's fansful to believe that the industry can finance this in the short-term merely through assessments. i think that fdic is going to have to formally pull on its credit line with the treasury to keep the visible balance such that we don't cause public unease. they are not going to run out of cash. >> that doesn't sound like a big deal. it is a big deal because --

assets are not covered. once the deposits in the banks in the united states -- >> technically, dick, hook, they are paying out everybody, you know that. >> i know they are paying them out, but they don't have to. >> i understand that but not willing to cross that rube cico because they don't want to say they are not covered. >> chris, what i find interesting, bank stocks are doing so well. >> well there is no connection between the fundamentals and the stock price. >> okay there is no connection. easy to say that. it is true. >> almost everybody else besides you believe credit conditions have been healing, liquidity conditions have been healing. >> no. no. >> bank earnings on the rise, maybe they can earn their way out of it. i want to ask you, your pessimistic view is directly at odds with the action in the stock market for banks, including the july rally. how do you reconcile that? >> july? that was late. you had to be in at the end of march. >> i'm saying including july. including the july rally.

>> larry, momentum. >> banks the second leading -- >> no. no. >> early march. >> larry, you know better than this. >> i'm asking you a question. >> you know better. >> why is it if the situation is so bad, all right, since early march, the bank index up 140% and even in this summer rally, up another 35%. >> of course. >> why is that if things are so bad? >> because the buy side is predominantly long. they can't take advantage of a short market. they were underinvested in financials for three quarter? >> you're saying people are dumb? >> they have nowhere else -- larry, we live in a fiat money system. they have nowhere else to go. >> i don't agree on bank stocks. dick bove, you made a call two or three weeks ago to get out of banks. >> i think what's happening right now, people are expecting the future a little bit too soon. we were really aggressive in buying these stocks now at the beginning of the year and now we have decided that the stock

prices have moved so far, that the multiples on future earnings are higher. the multiples on -- >> oh, yeah. >> earnings are higher today than they were on average earnings over the past five years. stocks have simply gone by fundamental values. >> absolutely. >> chris, equal time on this, should you sell them? i mean is that your investment call, should you sell the banks? >> larry what i'm telling my clients they want to be out of the names that have run 100%, 80% and the righteous, the bank of hawaii, the rest of them, look at those as a loss. >> guys, got leave it there we are going to go thanks to both of you, scott cohen who has breaking news now. what do you have? >> such as it is melissa, the new york post reported it morning that bernie madoff in prison in north carolina is dying of pancreatic cancer, "the wall street journal" confirmed that story from sources, all unnamed sources here, but now the u.s. bureau of prisons is chiming in saying the new york post made-up story is "inaccurate." the bureau of prisons says it is

not going to comment on madoff's health but now seeking madoff's permission to release the information. his attorney said he does not comment on his client's physical or mental well being. >> more about that later on in the show. >> conflicting signals. the bulls are leading the markets high today, despite concerns about what lies ahead in september. up next, will the summer rally carry into the fall? and a little fertilizer boost for your portfolio. details on a company that's growing during the downturn and keeping the grass greener across america. that's ahead, only right here on the call. we will be right back. some people buy a car based on the deal they get.

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welcome back to the call. i'm brian shackman, the nynex in lower manhattan. the oil trade continues to the upside, 6% plus last week. the second largest refiner coming out and saying they are going to spend 35 billion in the next two years in capital expenditures that is significant. routers saying chinese royal demand year over year up 3.5%. the iraqi oil minister saying today opec should not boost production at its meeting. prices where they need to be.

nat gas. dollar is stronger, gold down, silver and copper are to the upside. melissa, back to you. >> brian, i just want to point this out, oil is a big story today, trading right at the top this range oil trapped in for a while, everybody familiar with the top of the 50s up to mid 70s trying to get to the high 70s, this is a pretty essential trade today. what are the people on the floor telling you whether they can break free? they are feeling resistance? >> volume is still relatively light. if they do breakthrough 7 to 5, they think the past to 802085 is relatively clear. so, does seem to be a battleground. we got as high as 7481. the resistance is definitely there. if it breaks out there will be momentum trade to the upside not there right now. >> without question, one to watch today.

brian shactman, thanks so much. mandy? >> brian said it there oil markets, the equity markets moving in tandem. ten-month high for crude and equity markets. dow up .6, 9568. s & p up, 1033. nasdaq positive territory, 2031. biggest question on everybody's mind is will the stock market rally continue? let's bring in paul schaadts, president of heritage capital and david hefty, ceo of cornerstone world management. gentlemen thank you very much for joining us. paul, get to you first of all. i notice here in your notes you are billed as the bull here but still say the rally is perhaps close to the end than the beginning. explain why. >> first of all, no rally has gone straight line. if you take two steps forward, one step back. all i'm saying is as the season turns into september, bull markets typically have these almost like elevator shaft real

quick moves lower. they are sharp. they are very brief. as we get into september, preannouncement season, probably see another elevator shaft decline, depending upon where we go the next couple of weeks, could be 3%, could be 7% but going to be quick. >> what is the trigger here? val valuations or something on the earning side or economic bad up in? what do you reckon? why don't you weigh in on this one, david? >> look at this right now, first of all this rally is nothing more than bear market bounce. so we see this bounce coming up, there probably is some steam to carry this thing through. >> a bear market bounce you still reckon we are in if in ary bear market? >> we are in a secular bear market, going to be in a secular bear market the next ten years. we look at this, this is a bounce we are in right now no fundamentals pushing the market higher, 100% momentum. however, i do think this bounce is actually going to go higher, so i am bearish but i do think this is going to go higher through the end of this year

maybe the first, second quarter of next year. >> so the bear is -- the bear is bullish and the bull is bear. this is an odd story. >> flipped around. >> paul, comment on what david is saying, secular bear markets? >> no i respectfully disagree. you go back to the '02/'03 bottom, '98 bottom, 1990 bottom when iraq invaded cue wait, the same thing happened. everyone said we are in the secular bear market, going to last 5 to 20 years and the first rally everybody said, well, maybe cyclical bull and secular bear. bottom line, depends what you define. this is certainly a cyclical bull market, put any definition you want on it going to go higher, 10,000 is the minimum, all likelihood, going to continue much higher after that. could problems spring up? absolutely, down the road, not now. >> david, just in terms of your cyclical call here, whether we are in a bull or a bear can we back to prelehman, 1200 on the s & p 500, trading over 1,000 now? get back to prelehman?

>> honestly, larry, thank you is where we are going to price peak out. going to get close to that peak out. at that point, as we come out of this recession and we look at demand, demand is going to be very weak coming out of this all manufacturing, everybody is ramping up supply for 2007 demand levels, they are going to overshoot it. if they overshoot their supply side, push us to a double dip recession. i tell you, if the recession, the second recession won't be the factor that drives the market into the toilet it is going to be the fear of the investing public that starts to run that thing down. if we happen to have a soft landing, talk about soft landings, the economy gets weak we need a soft landing on this expansion. if we can get supply to match up with demand and have a soft landing on the expansion, when we can avoid that double dip recession and have a smaller pull back. >> david and paul, bull and bear lines a little blurred, when it comes to energy, i believe you are completely die cot mized here, david, you like energy, paul, do you not.

both give us the case, paul, you first? >> to me, my concern of energy is strict lay dollar play i see the dollar getting stronger and stronger and stronger over time. energy will probably -- >> why? why? a huge deficit, interest rates still so low? why? >> warren buffett getting very bearish on the dollar? >> also, of course, warren buffett also told to you buy stocks at, you know, and right around when the lehman thing happened. let's call a spade a spade. >> he did renew his call last winter. >> absolutely. >> including me did not see lehman brothers coming, so i'm guilty, i guess mr. buffet was guilty, ran a very provocative piece in the new york times, pretty worried about the dollar, fiscal, monetary stimulus, overstaying our welcome. these are not crazy thoughts, these are sensible thoughts are they not? >> everything is sensible until it happens, larry. here is my argument on the dollar, number one, we all know the fed printed 18 catrillion. >> quantify that? how many zeros on that?

>> all know we are going to run obscenely high deficits for many years to come f that is the case why is the dollar not selling off more? hanging above the low? >> you really want euros? would you really want yens? >> where else would you park your money? for the moment is there a really viable alternative? >> to the dollar? >> to the dollar? >> there isn't. but that is part of the argument. you have no invasion. anything, you get a whiff of -- >> all that spores a dollar. >> coal viable, oil viable. david do we need tech to lead? story on the way out, journal today, tech is the bellwether leader. where are you? >> i weigh technology, we came out of cash april 7th, which enter into technology heavy, rode that wave up, i sold out july 21st. i do think that technology is going to not do well? no i think everything is going to get lifted up the rest of this bounce but i have to get, you know, a lot more defensive on how you manage through the type of bubble, 'cause actually, when this thing pops, it is going to be big, come back out

of it quick. >> gentlemen, thanks for your time. >> thank you, welcome. a fur-lined boost for your portfolio, details on the company boosting sales, keeping the grass greener across the nation. first, jim goldman following the twists and turns of google versus apple. jim? >> you know, google said it was a led of bull when apple denied software from the apple store, not denied, delayed, the software could be a trojan horse. this is starting to get a little nasty. details when we come back. reading about washington these days... i gotta ask, what's in it for me? i'm not looking for a bailout, just a good paying job. that's why i like this clean energy idea. now that works for our whole family. for the kids, a better environment. for my wife, who commutes, no more gettin' jerked around on gas prices... and for me, well, it wouldn't be so bad if this breadwinner brought home a little more bread. repower america. i hope our senators are listening.

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welcome back. specialty drug maker warner chilcott acquired procter & gamble's prescription drug business for $3 billion. the deal will double the irish drug maker's revenue. you can see the -- let's see, warner chilcott, that is up now 4 bucks. program it ter and gamble down a little bit. other -- battle of the tech tightens, apple and at&t joint effort to keep google's voice software off the iphone. the fcc is weighing statements from all companies. here now, you can see how they are trading google, apple and at&t all trading higher on the

day. jim goldman has more on the story. jim? >> weighing statements from all three, melissa, we only get ac toeses to two, more in a second. friday, we got statements first from at&t and am filed with the fcc in connection with the google voice ap controversy. remember apple and at&t drew fire for denying google's voice ap from the am store. the move demonstrated apple's predatory behavior and the anti-competitive strategy since the google software could be a competitor. for its part, at&t say as it "had no role in any decision by a toll not accept the google voice ap. at&t was not asked about the matter by apple at any time nor did we offer any view one way or the other." but the far more interesting developments come in apple's statement, which first claim despite published reports that google voice hasn't been denied but still under review. and second, the reason it has been delayed is because apple has found that "once installed,

voice alters the iphone's distinctive user experience by replays this placing the iphone's core functionality and interface with its own user interface." this is a trojan horse that could turn iphone into a google phone. google filed a same but asked the fcc to have it redact sod we don't really know what google's argument might be in this. in the same apple documents, intriguing stats, 65,000 program available, downloaded 1.5 billion times. apple receives 8500 application every week, 95% of those as that make it approved within 14 days. apple says 20% are denied. apple says the reasons the google voice ap approval has been delayed are the same reasons to delay or deny other programs, am isn't setting a precedent with google but sticking to precedents already in place. more this on the blog, melissa, tech check.cnbc. >> left with one relatively obvious question here what do you think is going to happen?

google make it in the ap store? >> you know, i would have to say no. >> really? >> yeah, the reason being is google is going to have to essentially go the fundamentals of this software and completely redesign it for the apple ap store, after all of this, not clear apple is going to look at it at that point and says it works fine and go ahead and do it i think is a long shot still. >> jim goldman, thanks very much. "power lunch" at the top of the hour. sue herera what is in store for us? >> hi, mandy, all is right with the world, larry is back. great to have him back with us. >> looking dapper, too. >> yes, he is, indeed. oil versus natural gas this great divide, part of it has to do with some complication of the etfs and issuing share, straighten it out and figure out where you should put your money. should you bank on the regional banks? we have a terrific analyst who is going to talk about that? first on cnbc, peyton manning is going to join us with darren rovell, i can't wait.

all that at noon. >> i might stick around for that. >> thanks so much. up next, the company that is not only fighting the recession, literally making the grass greener while doing so. "the wall street journal's" wendy baum has the main street business report, straight aheadt only here on the call. we are cnbc. say you want to backtest an entire portfolio of stocks. market experts show you how through fidelity's extensive trading knowledge center. and fidelity gives you free research from 15 independent firms, with accuracy scores... to help you decide which analysts to trust. find out why more and more active traders are turning to fidelity for a smarter way to trade online. trade like a pro. trade with fidelity. right now 1.2 million people are on sprint mobile broadband. 31 are streaming a sales conference from the road. eight are wearing bathrobes. two... less. - 154 people are tracking shipments on a train. - ( train whistles ) 33 are im'ing on a ferry.

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it the end of an era for reader's digest. the company filed for a prearranged chapter 11 bankruptcy protection as it tries to reduce its debt from

$2.2 billion to $550 million. the filing only affect it's u.s. operations. the flagship magazine has seen its circulation drop from a peak of more than 17 million back in the 1970s to 8 million this year. not only are they weathering the storm, the grass greener for scott's miracle groh. check out the share of the companies trading the 52-week high, up 63 cents, 1.75%. how is the lawn care giant keeping stock strong during the downturn? wendy baum spoke with the company's ceo and she joins us now with all of the grass-growing, weed-killing details. >> i didn't think anyone had had a lawn anymore? aren't all homes in foreclosure in. who is buying miracle grow? >> last year, scott's was in trouble, right? late of home gassing to foreclosure if i'm going to cut on anything, i'm going to cut back on my lawn care, stock

today hate nine-year low this he shored up the fundamentals, hit the streets, instores, had a lot of little companies say to me we can't get our products on shelves because scott's blankets the shelved with their products. didn't find a lot there. other thing analysts are watching, r&d, new products in the pipeline, particularly in the natural bioherb side category. you and i were talking a minute ago what, is the secret ingredient? >> magic ingredient. >> killer ap which scott's critics is working this natural bioherb side made from a fungus. why is this good? we don't want to drink this, but on the other hand, this is something that is -- you can put on your lawn, it kills the pests homeowners don't like, like the big broad leave weeds, and it lions, the glove clover, the plantains, doesn't hurt the grass. people concerned on the environmental front and the health front about the effects on chemical sin threatic pesticides. scott's is now really going into this market to try and develop

alternatives in this natural category, if you will. a hard road for them, a company with deep roots new york pun intended in the synthetic world, kind of having to talk out of both sides of their mouth, don't want to hurt their cash cow products. >> buying the stuff? melissa's point what does the sales look like, a goofy question? >> do you your own lawn, don't you i can see larry out there doing his own weeding? >> in connecticut, acres of lawn, i have commodities, my hands never touch a soil, i have a team that does that. >> keeping employment up? >> creating jobs. my bride is very good at t on the other hand -- >> national gardening association came out with a survey said 40% of people say they are likely to try all-natural products in coming years. i take this with a little bit of a grain of salt, i say only if these things work as well as the older products. scott's has to be care before this. they do not want to be like, you know, eastman kodak was years

ago, don't want to be sitting on the sidelines people coming in saying digital but the guys for kodak saying film sells really well. they don't want to have naturals come rushing in, take the market share and not be there at the foreproperty of this, they are pushing money in with the bioherb side, a mosquito repellent made from wild tomatoes, water-conserving mulches that have the surfactant technology, taking a broad approach to -- >> how did you learn all this stuff? >> i went and talked with the ceo. i'm trying to make my high school biology teacher proud. >> is it going to work seriously? >> if i were watching the stock as an investor, i would watch to see how much advertising and marketing muscle scott is really going to put behind these products, if they don't, right, and sort of let it out there, dribble away, then it is not going to drive that category. the other hand, put this muscle behind it, it could fundamentally change this industry. >> he love advertising, good for us here at cnbc. thanks so much, wendy bounds.

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