as we head into the afternoon, royal caribbean lines is up sharply. barclays said this is the stock to sell because of swine flu. that conference today in boston today, tyson foods ceo is speaking today. chicken business is soft. mcdonald's reporting same-store sales, pretty meager. the stock hit hard in the

premarket, bounced back a little. still lower though. and starbuck's cfo speaking this morning, recovery a long road, but he thinks they have the size right now. >> thank you very much. before we wrap things up today, we want to bid a very fond farewell to our tech associate. wayne has been working various tech jobs over the nine years he's been here. he's getting married, moving to colorado. we want to wish him, we want to wish sherry, all the best. we're going to miss you. >> good luck to wayne and that's it for "the call." >> i'm becky quick. >> i'm larry kudlow, see you tonight for a preobama special. and now, "power lunch" is up next. @ññó?ó?ó?ó??

in fact, wayne was here when i got here. >> an original. >> welcome to the september 9th of '09 edition of "power lunch." anything can happen and we're hoping it does. i'm bill griffeth. stocks pushing higher again this hour. health care among the winners. ahead of the president's address before congress tonight and new developments to tell you about. boeing and 3m are leading the dow. a diving dollar, gold rush in oil is shooting up once again. what are the best playing in those markets? six stellar stocks for your portfolio. did yoko ono drop a beatles bombshell? wouldn't be the first time she screwed something up. here's what else is on the

menu. jim? >> indeed, michelle. was that a bombshell or just a bomb by sky news. the apple deal, unlikely, but there will be new i-pods and a price cut, but no matter the news, if delivered by steve jobs, it will be big. officials say the administration's housing program is on track. the beatles rock band is the most hyped video game launch ever. they're hoping it will revive the business. the beatles are expected to bring home a $1.6 billion payday this year. oil is high, trading around $70. the nasdaq is on track to close at its highest levels since last october.

matt? >> i'm just thinking beatle lyrics here. here comes the sun, how's that. we're a 60-point buyer and the sun has been the industrial group, but the rising sun if you will, is going to be the financials. let's talk industrials. ge is the darling of the day. yesterday, the jpmorgan upgrade. today, the price target increase at goldman sachs. it and half a dozen others all seeing their price targets pushing higher. also, i mentioned the financials, it's upgrade t. we're also seeing insurers like aig and genworth bringing life back. the nasdaq's outperforming today. it's up more than 1%. some of the gains, oracle's better than 2%.

ebay got upgraded 4.5%. as did the semiconductor index. the stocks up 1%. palm though, opposite direction. downgraded over at credit suisse and the price target taken down to 12. let's go to rebecca at the nymex. >> it is a very tense day here on the floor of the nymex. a lot of traders tell me they were caught off guard coming into yesterday's session where prices spiked 4%. lot of traders say that fund mentally, they are looking at the bearish scenario. it's the dollar that's driving things higher. opec isn't going to be meeting until after this market closes, but i want to touch on the point and that dollar weakness and why prices are higher as far as commodities are concerned.

what traders see is the demand to own hard assets over paper money. rick, over to you in chicago. >> it's the fiat. we're not talking about the car. we are talking about paper currency. let's look at the credit markets. one-month ten, a longer version. why? because rates are only up three basis points. 351 is still is the highest yield in about two and a half weeks. getting some action in terms of the dollar. two-day dollar index shows you there's been another handle change. we've moved in the 76. that hasn't been seen obviously in a year and if you look at the dollar, yen with a 91 handle, this is the first time since february. bill, back to you. >> we didn't mention the ten-year note auction coming up this next hour.

a key report on the state of the government's housing bailout program was released in washington this morning. diana olick joins us from capitol hill with more on the home front, plus, she has a special guest. >> the treasury reported that 360 loan modifications have been started. as this was released, we had a hearing here on capitol hill bringing in the top treasury officials who started the program. we have with us michael barr, who started the program. 360,000 loan modifications have been started, but more than half a million offered. why is there a discrepancy? >> it takes a while for borrowers to respond so the servicer to put in place all the steps they need to comply. there's always going to be a lag between offers and completed

modifications. >> we're also seeing an expected 3 million homes will receive some kind of foreclosure. that doesn't sound like a lot compared to that. do you believe this program has been successful or do you want to see more from servicers? >> i think we're on track to reach 500,000 borrowers by november 1st. it was started in may. this is significantly fast ramp-up for any program. we're reaching half a million borrowers in a five, six-month period is pretty remarkable. how diz it compare with people going into foreclosure sale and we're making a lot of progress. >> what is your reaction to barney frank? >> the president has been a proponent of bank reform. we tried to get that enacted last year as a way of getting borrowers not eligible for

modification a last report for going through bankruptcy. the first and best answer's got to be let's figure out a way of keeping people in their home with a modification and that's where we're focused. >> we're aware of the fact that i didn't get a modification, but a refie even though it was supposed to be helping people on the verge of foreclosure. can you ask him if it's helping people who need it the most? >> i will. that's our anchor who actually got a refinance under the plan. she says perhaps she's not the kind of person this is targeting. why is a well-paid anchor getting a refie under this program? >> our program is a program designed to lower mortgage interest rates. it's terrific that she was able to take advantage of the program. we want people to have more affordable mortgages. we want people to be able to

stay in their homes. we want our economy to get going. >> you said you wanted to see servicers to do more. >> they do need to do more. there's still uneven performance among servicers. we've asked them to do more, treat borrowers better in the process. we think they're doing better as a result of our meeting. performance is up 50% among the top services from july to august and we think we're going to see continued improvement. >> thanks so much. >> thanks. >> for the record, i did not cost the taxpayer any money. i just got a cd refie. >> i feel better now. let's talk more about the dollar and markets because the dollar hit new lows once again for the year. oil is surging, gold prices continuing to rise. is there another way to play these markets. our "power lunch" task force is here to give us some advice.

welcome, guys. nicholas, i'll start with you. are you concerned with the rate of decline, the swiftness with which the dollar continues to hit new lows? it's pushing up oil prices and gold prices. >> the volatility of the dollar is going to determine the effect on the economy. the move has been sharp is past couple of days, but longer term isn't fairly modest. as long as we continue along that path, i'm less worried. if we see a sudden contraction then i would grow more concerned. >> and kelly, the decline of the dollar has not hurt stocks. i know you like the stock market. is it in part because of the decline of the dollar? >> absolutely. we're focussing on some of the companies and sectors that would benefit from a weaker dollar

including industrials. basic materials and certainly energy. i agree that if we start to see a continued decline, that can be disconcerting, but at these levels, clearly, the beneficiaries are multinationals. >> nicholas, you also like industrials, but also financials. what part of financials because it's such a big pot and there's so many issues out there. >> we take a view of financials because of the curve. there are some major problems to get through. commercial real estate. but in terms of looking at the early part of a cycle, financials tend to be the early movers. i agree industrials are a great place to be and we like tech as we. >> thank you both. up next, the edge on the six best investment ideas right now.

six stocks to consider for your portfolio. and what's the best country in the world to do business? here's a clue. it's not necessarily the united states. and the president says we should consider taxing soda and other sugary products. is this a good way to pay for health care? >> no. >> i think it's a good idea. we could do this debate. >> we've started the power grid already. and get ready for the fast money halftime report. back in two minutes.

(announcer) we understand. you need to save money.

one of the stocks we're watching the aig. one reason is the percentage move on the stock. also it's gained over its 100-day average. last trade up $3.31. it's trading just under 40 bucks a share. meanwhile, we've been looking back on the events of september of last year. lehman brothers fell 45% that day, but the feeling perhaps was that there would be a bailout of lehman as we had seen with bear stearns just six months before. but six days later, on the 15th of september, lehman brothers

was out of business. >> and we all felt like we were falling off the cliff. today, morgan joseph unveils the recommendations. they think these ideas are going to perform well whether the rally continues or fades. from david, director of equity research. let's start with flir systems. he said this the pure play on infrared technology. >> that part of the defense budget is growing and they're doing well internationally. 60% gross margins. stocks trading at 16 pe. it's still growing. >> the next one is imax.

you guys really know how to call it. calling it a leisure company. it's such a great technology. it really, when you go, it's such a great experience. why isn't this company doing better than it is? >> it is doing better. they've gotten 273 this year. >> but it has struggled for years. are we finally now going to see it fulfill its hope that we've had all these years? >> that's the key is that they've gone digital from the end of last year to know. and there's a huge opportunity for them. they can do 1,000 movie theatre over time. we think to about 90 million within about two or three years. >> you don't like garman. why? >> we think this is like a calculator. it's a great product, but as smart phones really take off, that's really going to hurt

them. it trades at a market multiple, yet revenues are declining. >> it's up now. >> it's done well in the recent past. we think that over time -- >> the argument is that people now have a gps on their i-phone and don't need a garmin product. >> and phones like the i-phone, the screen is just about as large as a garmin product. >> let's go through the next three. byi, what do you like about it? >> the casinos have really held off the last few years and games only last about three to five years. bally has gotten about 20% in

the last year. once again, another very inexpensive stock trading at less than three times. about $15 billion of opportunities this year. i think there will be a lot of positive announcements going on and they just announced two big contracts. >> and rcn corporation. you've got to buy on this one. why? >> a very inexpensive stock. we like the free catch flee yield of over 11% on it. >> six ideas that you think are going to outperform regardless of the overall market. thanks so much. where are the most business-friendly places in the world and where does the u.s. rank on this list? the answer first on cnbc coming up. plus, the much anticipated

apple event set to begin in about 40 minutes. will steve jobs make an appearance? >> apple shares ahead of the announcement are higher. [ engine revving ] [ engine powers down ] gentlemen, you booked your hotels on orbitz. well, the price went down, so you're all getting a check thanks. for the difference. except for you -- you didn't book with orbitz, so you're not getting a check. well, i think we've all learned a valuable lesson today. good day, gentlemen. thanks a lot. thank you. introducing hotel price assurance, where if another orbitz customer books the same hotel for less, we send you a check for the difference, automatically. - oh, come on. - enough! you get half and you get half. ( chirp ) team three, boathouse? ( chirp ) oh yeah-- his and hers. - ( crowd gasping ) - ( chirp ) van gogh? ( chirp ) even steven. - ( chirp ) mansion. - ( chirp ) good to go. ( grunts ) timber! ( chirp ) boss? what do we do with the shih-tzu?

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in the north of england to my new job at the refinery in the south. i'll never forget. it used one tank of petrol and i had to refill it twice with oil. a new car today has 95% lower emissions than in 1970. exxonmobil is working to improve cars, liners of tires, plastics which are lighter and advanced hydrogen technologies that could increase fuel efficiency by up to 80%.

with we saw apple hitting a new high, also, starbucks and conagra foods. the world bank is out with the best countries in the world in which to conduct business. the report assessed over 180 economies, include iing the easf starting a business, protecting investors, trading across bor r borders and enforcing contract law. thank you for joining us. >> it's a pleasure to be here. >> what we're going to do is cut to the chase here. everybody wants to know where the u.s. falls. it was number four. one three three in asia and

southern hemispheres. why did they bubble to the top? >> well actually, singapore continued to be the leading economy now for the fourth year in a row. what we saw this year is that reforms to simplify continued at the top. singapore and hong kong continued with initiatives to make the life of their local businesses easier. >> what would get the united states up higher and what's your prediction for next year based on what you're seeing now in the united states when it comes to regulation? >> in terms of regulations, how easy or difficult is it to run and upgrade a business, it's very difficult to make predictions nowadays. you saw a record number of reforms. around the world, economies and governments are implementing more and more reforms aimed at

supporting local businesses. >> is the prospect of more regulation here in the united states dimming its chances to move up the chain? >> the report is not about more or less regulation. the important thing is to have the right regulation and regulate the areas that need to be regulated. some of the areas such as protecting invest rs are areas that require strong regulation. >> what struck me was when you look at everything, the ease of starting a business capitalism has been so demonized, but i was heartened by the report said most countries are moving towards those things. >> what it's really about is how can you support the main job creators in developing countries around the world. it's really the firm level of regulation that we're looking at

rather than large market regulatio regulations. we see a strong commitment of governments around the world to support their local businesses. >> and in between singapore and hong kong there, new zealand. it's number two. >> there, you can start a business in one day just by going online, completing all the transactions and the government has worked a lot of make sure that all the dichbt agencies involved are coordinated. >> and it is a beautiful country, too. that would help. thank you for joining us. >> thank you very much. >> if you want to get the rankings here, go to doingbusiness.org to get the full report. up next, president obama says we should consider a syntax on soda and other sugary products. is this a good way to pay for

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welcome back. the headlines at this hour, mcdonald's is beginning to feel the pinch. sales rose in august, but came in below estimates. talbots on the rise. that retailer's plan to turn business around may be paying off. and ebay upgraded to outperform. meanwhile in new york, reports that ebay is teaming up with fashion designer narcisco rodriguez. just hours before his speech

tonight, in an interview, he said he's open to taxing soda and other sugary drinks. is this a good idea? squaring off -- you guys know how it works. you get 20 seconds to make your case. julie, 20 seconds. why you think this is a good idea. >> well, obesity costs the nation 47 billion a year. a three-cent tax would raise 24 billion over four years. it's the smart thing to do economically and for people's health. it discourages behavior that leads to obesity and costs. >> i don't know what happened to our buzzer. i guarantee you your out. >> welcome to the brave new nan nanny's date world. every time somebody proposes a syntax, i want to say, who made

these guys god. it's not the government's job to tell me what's good for me. people do lower their con sumts so this is not going to work. >> if we were all collectively paying for everybody's health care under the coming proposal perhaps, we feel like we can tell each other how to live their lives. >> if you want to have a mountain dew, have one, you'll just be paying three cents more. what i am a little tired of is having to pay for people's bad behavior because that costs affect me and you and our costs that are paid by everybody. jason, your point is actually not valid since obviously i have to pay for those costs. >> how do we get more personal

responsibility? >> let the insurance company's price risk. they are putting the community rating mandate on companies that doesn't allow them to say, if you have an unhealthy lifestyle, you're going to pay a higher premium -- >> if you're saying that insurance company because of preexisting conditions can't throw you off because you've got cancer, i'm all for that. >> wait. the very premise of your tax is not a preexisting condition. the very premise of what you're saying is that if you raise taxes, people will consume less and therefore be less obese. that's not a preexisting condition. >> i can't take this anymore. the republicans and all opposed to this were crying foul about the amount of money this was going to cost and when the president was talking about taxing the wealthiest americans to pay for this, there was a cry

out there. now he's found what may be a more equitable way to pay by taxing, let's talk all the fat hamburgers that we buy in this country in addition to the sugary sodas in addition to everything else that's not good for us and use that to pay for health care legislation. >> we're all paying for it already. i still pay for people that get big macs every day. >> you are. >> what? >> you are against mcdonald's. >> michelle, i'm simply saying that if you're going to contribute to my bottom line because of your bad behavior, if you want to smoke and go to mcdonald's -- >> julie -- let me get in here. you and your ilk collect vise

health care. >> go and drink a case of -- >> what we saw in los angeles this year, what did the l.a. city council do? they said you know what, in certain new zip codes, no more new fast food restaurants because too many people there are heavy and they cost us money. >> i don't support singling out zip codes. if you go and drink a case of mountain dew and balloon up to 400 pounds and as a result, your health care costs go up, i have to pay for it. what's the better way? >> to have health insurance and everybody buys. i buy my own car insurance, life insurance. >> if the government raises prices -- >> government's not gouging. >> the debate has gotten way off message now. you brought in so many elements

that are irrelevant. the question was should we fund the health care plan by using a syntax. yes or no. that is the debate. it has nothing to do with l.a. prohibiting the fast food industry from billing more plants there. >> i'll answer that question. >> way off base. >> i'll answer the question. we shouldn't be funding the health care plan, period. the whole thing ought to die. >> right. we should buy our own health insurance. allow people to buy insurance across state lines, create a mass market in the united states and all buy our own health insurance. >> what about those people that can't cover -- >> give them a voucher. >> what if i have $100,000 -- >> for goodness sakes -- how many more programs do you want? >> what if i have $100,000 worth of health care costs because of

i come down with terminal cancer. >> you get a voucher. >> for how much? >> i love this. we finally found -- >> i'm sorry, we don't want to cover you because -- >> congress is already deciding how much. >> no, congress -- >> a possible equitable way to pay for health care and now you've changed the debate. >> the bottom line is you guys would rather have the status quo. >> one more thing. >> it was great. don't forget, tonight, president obama set to address congress tonight, 8:00 p.m. eastern time. larry kudlow holding his own session with senators, all begins to want at 7:00 eastern time. right after "mad money." we were wondering if steve

jobs would show up. guess who did. erik smic schmidt. apple shares have been doing very well today. the stock doubled this year to date alone. up about a half a percent. you're watching cnbc and we are first in business. the meeting with northern trust went well, didn't it? yeah, they get it. they really get it. a little more stability would be nice. northern trust offers the strength and expertise... that can only come from a 120-year track record... of thriving even in difficult times. they understand. roller coasters are for kids, not money. ♪ northern trust. wealth management. asset management. asset servicing.

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as we mentioned before the break, google's ceo is in attendaatte attendance at this apple event. it was our jim goldman who spotted him. who else is there? we're hearing rumors somebody else is there, too, that we've been wondering about. >> the eric schmidt siting was a little unusual since he left the board under those circumstances with all the conflicts between google and apple. why he is here, we do not know, but he did give us a pleasant hello and walked in through the front door. let's talk about yoko ono because she is making news. one of the big rumors ahead of the event in about 20 minutes. britain's sky news reported today that she has confirmed a deal now with beatles and

i-tunes, but just as quickly as that news appeared, it was immediately taken down. apple insiders are shooting down that news. we are expecting a big i-pod refresh. we'll also get price cuts, which apple is confirming. a new look at i-tunes and the app store. and we've just confirmed steve jobs is here. he will be making his first appearance since his medical leave. and no matter what the news is, it will be big because steve jobs is delivering it. guys, back to you. >> will the beatles be there as well? coming up is the "fast money halftime report." >> i'm going to have a soda. ese

welcome to the "fast money halftime report." the market's trying to go forward, four in a row. we've got headlines right now. we'll tell you how to trade. let's get to the word on the street. our crew today -- guys, we've got headlines crossing apple near a 52-week high. steve jobs is at the event.

we also know the ceo of google is also at the event. ken seymour, do you drar to put on a trade of apple? >> well, i think the stock spiked on the steve jobs news. big expectations on product announcements today. 190 is really the place where you get worried about this stock, but if they follow through today, they'll get price cuts to make them more competitive. very positive, yes. >> how have the traders been setting up for this event? it's much anticipated and all sorts of expectations about what sort of product they'll launch. >> there's rumor about the new set-top box. a lot of traders have been playing it that way. we're seeing a little bit of upside call buying here, but if you're a trader here, what you

might want to look at is potentially substitutes some long stock for a long call. or if you want to protect up to a 7.5 run -- >> jared, what's the implied ball on this stock and what would it cost a trader out there? >> it's expensive. that's why on the flip side, it would be more -- to sell a call. if the stock moves, that implied volatility is mitigated. >> for all those people looking to get into apple, 173. what's the next stop for the stock? >> as long as we can hold 168,

167, near term -- >> what's near term? >> the next couple of weeks. then i think we can make a run towards 185, 190. >> we made the point on the desk last night that apple's the kind of stock that needs the entire market to run to keep running. today, we have some bullish calls out there. is that the sense you're getting from the traders on the trading floor this week as people are coming back in? >> absolutely. i think, too, a lot of techs are pointing to a bullish push. we're also only three weeks away from the quarter. i think window dressing will be on the rise. there's a lot in store for us. >> want to ask you about the mother ship. general electric. two upgrades in two days.

what do you think at that stock at these levels? >> i think we can break it and i think it's testing it now. as people look towards their infrastructures and technology business, these guys actually have some room to run. that's what's happening. look at the dollar's move. that is where people are going and ge has some room to run in terms of their operational leverage. coming out of this, this will be a leaner, meaner giant going forward. >> the s&p 500, where are you seeing the charts heading? >> i have had no indication that the market is stalling in any way. the fact that the bullish momentum is still in place, we keep harping on the fact we don't want to overthink this market. however, in the last couple of

weeks, there has been a consolidation at the top. i still think there could be a head and shoulders top if dwoent get through today's high. things could become rather shaky. >> danny was talking about managers feel thisdisfigured head and shoulders dummies out there. i mean greg's being cautious on that, very cautious. we've seen this happen three, four times in the last two months. >> tim, you're right. i didn't buy into the last one which actually catapulted the market higher. this is very tenuous but you still have to be aware of it. >> another perhaps reading of the economy here, mcdonald's trading lower today, reporting weaker than expected same-store sales. we're also seeing declines in yum brands well leveraged to the china trade. pete, does this shake your

confidence in that mid cafe? >> absolutely not. u.s. sales were still strong enough and building. what we have to read out of this right now the trading mcdonald's, the trade in walmart, you see some of these pulling back a little bit because they set the bar so high for both these two different companies. it tells you that people are no longer going to bottom of the food chain. it shows a little bit of slowing in fast food but i still think you're seeing a build in mcdonald's. one thing to be careful of, sales numbers, yes, percentages, but. i think their margins could be very interesting to see where their sales are coming from right now at mcdonald's, even the trade up at mcdonald's. maybe people are trading up toward the angus. that would be very interesting to following. >> at the same time pete, as a long longer-term play, are you concerned about the moderate growth they're seeing in china? longer term don't you need to have strong growth in china in order to be a player globally in fast food? >> absolutely, you'd like to see some of that strength come back to china. that's an area a lot of people

are focusing on, including myself. i still think that's an area you will see some growth. obviously it is in a bit of a stall pattern. this is just one month's worth of sales, but i'd like to see a few more months put together. i still like when you look at the charts, walmart when it gets down toward the $50 level, something like mcdonald's toward $54, $55, that seems to be an area where it likes to bounce. >> pete, see you on the desk tonight. morgan stanley agrees with the tip-off pointing mcdonald's is trading at its lowest forward pe since 2006. next the president's speech on health care reform, le back away from the public option? if so, what's the right play now? the spokesperson for the white house robert gibbs on the "today" show this morning said obama will talk about the public option. danny, what are your plays given this confusion about what's going to happen? >> it's been a lot of confusion. in the health care sector in particular, a lot of companies have said there's nothing that we can do because if we make any

move the policy could blow us up. you have to policy-proof your portfolio. look at issues that only care about the global perspective, what's going on in china and india, some devicemakers in particular, certainly some outsources like hcsg, health care services group. we're also looking at big generic names, another way to play what's going to happen and who cares what happens. >> jared, how are the option traders setting up when it comes to the managed care providers? >> i like teva, i still like them going into this play. option traders are playing it the same way. it is very difficult to pin down. hopefully tonight adds some clarity. there's a lot of shucking and jiving on both sides. we've seen people taking bets that something's going to

happen. they just don't know which way. >> got to take a break. on tonight's "fast money," we've got the first on cnbc interview with the ceo of under armor. next, the health of the housing market one year after lehman's collapse. back right after this. i've been growing algae for 35 years.

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welcome back to the "fast money" halftime report. we want to check in on apple since we are minutes away from the official start of the event.

jim goldman reporting eric schmidt the ceo of google recently resigned from the apple board. he's at this event. there are reports in fact steve jobs is present. intraday high but also a 52-week high. this is a stock that over the past six months that is more than doubled. certainly high expectations for apple. we will dissect the entire trade tonight on "fast money." time for your trade to go. >> we've been very cautious about concerns for new government regulation in the space. they are increasing their power. they made an announcement that the field was three times tleef its reserves analysts priced in. at a time oil's going higher, we talk about the dixie, this is an em bellwether. you can't fight the tape on this one. if oil goes higher, they're going higher. the valuation is significant and the fact they are clearly on

side with the government now is part of the change in this story. >> that does it for us here at the "half-time report." we have up next analysis and reaction to the $20 billion ten-year option. we have a terrific show on "power lunch." any breaking news that comes from the apple event at 1:00 p.m. eastern time, then senator kit bond and former medtronic ceo is here, 1:30 p.m., smart money plays in the oil sector. at 1:40, one year later the health of housing. various reports say senate finance chairman max baucus plans to have the health care reform bill ready for his committee september 21st. apple steve jobs is present at his company's ipod related event scheduled to start any moment now. "the new york times" reports the buyers of peter cooper village

are at high risk of default on $4.4 billion in loans. the deal was the biggest ever in u.s. real estate. cnbc news now.  you can just feel something's going to happen this hour. i can't wait. >> lot of balls in the air. >> stocks are up for a fourth session. near the highs of the day right now. near the highs for the year in fact. financials and industrials leading the way. boeing, caterpillar, 3m among the dow winners so far today. that apple event is getting under way as we speak. our jim goldman is there. he has confirmed ceo steve jobs is in attendance. apple shares hitting session highs, a new 5 2-week high. opec oil ministers are meeting in about 30 minutes from

now. the smart way to play rising crude prices. one year after the financial crisis, we look at the health of housing in america. we are joined today, our guest host this hour when we lose the tone there is william george, former ceo of medtronic. he's the author of a brand-new book called "seven lessons for leading in crisis." we have so much to talk with you about, bill. let me start broadly right now your view of the economy and where we are. are we on the mend for real here, do you think? >> i'd like to separate it. the financial economy is clearly on the mend. corporations are going do better but we have a huge job crisis and that's affecting everything. affecting health care, energy. people feel a sense of crisis and we're not addressing that. i'm very, very concerned about we haven't faced the reality. we have 17% unemployment, under employment if you count people who have stopped looking for jobs. this is a big crisis.

>> but that's often the lagging indicator in an economy. that's the last thing to improve when we come out of a recession. >> i hear that. i don't buy it. i don't know one ceo that's that's hiring right now. they're figuring out how to get by with fewer people. we need to create more jobs, create more wall martzing with googles, targetses. those are the jops created in the last 25 years. >> but how do you create jobs when there is so much fear, not much credit out there. hold that thought. we have the results of the option. >> 351 was the yield. the bid was strong to cover at 277. indirect bid 55%. i'd have liked to seen lower yield, higher price. i'll mark it down a bit for that but it is good on the demand side on $2.77 for every $1

available. i'm going to give it a "b" for the ten-year option. we'll have to monitor if there is any response in the other market as we get ready for the 12 billion 30s tomorrow. >> steve jobs has just taken the stage at the apple event. he did indeed show up. as soon as we have some video of him we'll get it to you and hear what he had to say. >> we would love to be in there right now. live camera would be nice. once you finish your thought before we bring in senator kit bond on this. how do you create an environment where employers are willing to create jobs right now? >> all our incentives for short term. we need tax incentives for the long share and give investment tax credits for investing in capital equipment, research and development tax credits and we need some support for companies, forming companies and small business. we've overlooked small business. return to save jobs. we're not going to save jobs. that's not like a job created.

we need to create long-tern sustainable jobs that pay well. steve jobs, look what he created at apple? exports. let's dominate the world with our fantastic products. there's no place in the world like the united states. we have to face reality which we're not doing. we're kidding ourselves. we have a jobs crisis. that's lesson number one. >> you write about the president facing -- anybody will be defined by the crisis that they face and how they respond to that crisis. obviously one of the crises the president's facing right now involves health care reform. let's talk about that and bring in senator kit bond of missouri, the republican there. as we get ready for the president's address tonight, senator bond, welcome back. >> always good to be back. we'll have to do until steve jobs comes on. >> max baucus who chairs the finance committee as they prepare their own version of health care reform has said he is willing to go it alone without republican support for any health care plan. how do you respond to that right now? >> i think it would be a tragedy

for this country, probably for the democratic party. but mostly for this country. if they ram through a government takeover of health care, which i believe, and i regret to say, has apparently been president obama's long-sought ambition and they do it with a small democratic majority. i think it's going to cripple the country. you were talking with mr. george about small business. i couldn't agree more. a government takeover, the plans would kill small business and put bureaucrats between doctors and their patients. >> one thing the president mentioned in cincinnati on monday, as he was sort of floating some ideas that he'll bring up tonight, is this public option that has become this lightning rod for criticism of the health care plan that he has in mind. he said the republicans and other critics of the public option haven't come up with an alternative to try and support competition for the health

insurance industry right now. do you have an alternative to a government-run plan of some kind, senator? >> of course i do. but he wasn't listening to us. he wasn't listening to the people. one of the most important things we can do, when i was chair of the small business committee i fought a long time to give small businesses the opportunity to participate in purchasing co-ops that would operate on the same rules as the plans run by large corporations and unions that would allow them to bargain with the insurance companies for better, lower insurance rates and better coverage. >> senator bond, we got to interrupt you quickly here. steve jobs has taken the stage at the apple event. he's thanked the apple community for all their support. he says he's very happy to be there and he is there to espouse the virtues of organ donations which i think comes at such a perfect moment in this discussion, senator bond. when you look at organ donation in this country, it is about rationing. right? you have people at the top of the list based on how young they are, versus how old they are, based on their lifestyle, et cetera. there is a lot of concerns what we see there is what happens

with health care overall, if we take on some of these plans that are being proposed by the white house. >> i think rationing in organs -- i signed up to be an organ donor but i don't know if anybody would want any of my organs at my age. but i believe in it. i certainly agree with steve jobs there. when you can't get in to see -- you can't get a. smear, you can't get in to have a mammogram, you can't get in to check for cancer, that's why our cancer survival rates are much better than those countries with government-run health care programs. >> bill george, one of the ideas also floated out there ss a way to pay for the health care reform is to impose a fee on medical device makers. you used to run a very high-profile medical device maker. would that be an equitable way, one part of it, to help pay for health care reform? >> there's a quid pro quo, actually advocated fees to get

better regulation system out of the fda. yes. with you just a fee per se will eventually just be passed on to the users. the fact is president obama has lost control over the debate. he's played the politician role. he has to step up as a leader tonight and go on offense. >> gentlemen, we have an impossible situation. we're trying to juggle two very different important stories right now. ladies and gentlemen, is video of steve jobs moments ago on stage there in san francisco at the apple event. >> this is live playback. that's why you're seeing this. >> literally this is coming in live so there he was when he walked on stage to a standing ovation. he looks pretty good. he's still very thin, pretty wan, but we know what he's been through there. at the beginning of the year we were all speculating on what was wrong with him, now we know what was wrong. he's been through the transplant. >> it was one year ago today he

blamed hedge fund rumors for the "rumors" about his health. now we know he really did have issues about his health. >> he has been back to work since june, at least on a part-time basis, coming in to the office and he's been espousing the benefits of organ donations there. zbleshd >> he should espousing the right for people to actually get bad for their organs. there should actually be a free market when this t comes to those things. >> tonight, senator bond, the president's speech. what kind of olive branch can he extend to the right side of the chamber tonight that will bring you closer to some sort of equitable agreement on health care reform? >> he's gone so far to the left with his radical proposals, called people that disagreed with him names and accused people of organizing against him. best thing to do is go back to the drawing board. there are at least five or six major areas where we could agree together. i toll chairman baucus when i

talked to him that do some simple things. don't be raising more money by having more government control. we already spend a sixth of our gdp on health care. that's too much. let's cut spending and spend it right. >> senator bond, thank you for your time and joining us today. let's listen in to steve jobs, a few moments ago there in san francisco. >> -- it really meant a lot. i'd also like to especially thank tim cook and the entire executive team at apple. they really rose to the occasion and ran the company very ably in that difficult period. so thank you, guys. let's give them a round of applause. so, i'm vertical. i'm back at apple. loving every day of it. and i'm getting to work with our

incredibly talented teams to come up with some great new products for you. >> okay, we lost that feed. >> you've written the book now on dealing with crisis an the lessons that can come from that. here's a guy that had to deal with this crisis. this is a company that is personified by this one man who has been the creative genius behind so many of the products that apple has introduced over the last few decades here. how do you think they handle the crisis especially when you considered how secretive they were about his medical condition here? >> first, steve is a great role model for young entrepreneurs. i hope we can have a lot more like him in this country. they did not handle this well at all. they should have been open and transparent. in today's blogosphere they should have put it out there. it is a tragedy. hope his health will continue to heal and i'm glad to see him back. but we need more people like this. steve totally turned the company around. they were dead and he brought them back because -- this is the

great american spirit, entrepreneurship. he went on offense. as i say in lesson seven of the book, he went on offense to focus on winning. he won with the ipod. he won with the itunes. he won with the iphone. this is a great example of what all american businesses need to do to win on a global basis. >> if indeed all american businesses would like to provide health care to their employees given what's out there on the landscape right now, if you had to put together the perfect health care reform package, what would it look like? >> i'd do what i did at medtronic, focus on wellness and prevention. there is not enough money in the world out there to pay for full access unless we start taking care of our health. the president needs to take control of the debate tonight and get the american people into it. it is not about republicans an democrats. they're going to argue forever. it is about the people haven't bought into this plan because they don't know what it is and they need to see the benefits to them, how's it going to help them with their health care crisis. he needs to make the case and he hasn't made that case yet. >> he sounds very weak to me. doesn't he, steve jobs, his voice? >> i think that's to be expected

after what he went through. transplants -- >> this is veryserious. modern medical technology saved his life. and let's just hope he'll continue to come back. >> stamina obviously is going to be less than what it has been for a while. he only came back in june, then on a part-time basis. we've heard anecdotally that he's been very involved in the development of this tablet they're working on at apple there to the point where it's driving some of the developers crazy. >> some of them said that, while they weren't happy that he was gone, boy, that period of time with a actually a little free, even though clearly he's so instrumental in the design and has been incredibly successful with it. >> what makes him the kind of leader he is? >> because he's engaged with the people, engaged with the innovators. he gets down and works with them. he's not directing everything they do, just telling them this is not good enough, pushing, he's challenging, a great inspirational leader. >> we have to take a break but

what should apple do now? hopefully he stays healthy. do they need to be basically bringing someone up in case something does happen again to steve jobs? how do they handle this? >> we'll talk more about that with bill george, our guest, whose book is called "7 lessons for leading in crisis." also, lifestyles of the rich and now also infamous. a look at posh digs of bernie madoff. a room-by-room tour of his park avenue amount and his west palm mansion. one year later a trip to the front lines to see if housing's really turning the corner or are we just an interest-only adjustable rate mortgage away from yet another meltdown. here's what else is on the menu.

steve jobs just moments ago taking the stage at that apple conference. he basically thanked his employees, he thanked his supporters. he of course steve goldman is inside there and he also talked a lot about tim cook and, bill, we've put the question to you a few minutes ago, hopefully steve jobs stays healthy. we wish him all the best. he does look thin. his vows sounds a little weak. perhaps that's to be expected. but does apple need to change strategies right now and push tim cook forward just in case? >> well, tim cook has been running the company while steve's gone. i think tim's a very competent executive. they shall pair him with a very

creative developer that steve can, if you will, be his tutor for a period of time. apple is not just a one-man show. steve's done a great job but they have a lot of creative people in this organization. apple will go on, continue to invent and create. >> meantime, bernie madoff stole billions from thousands to fund a lavish lifestyle. the government is now trying to recover millions for his victims. we find mary thompson at his penthouse. you've gotten a look at this place. right? >> yes, we all have. with the videotape released by the u.s. marshals -- let this ambulance pass us right now. bernie madoff may have been confined to his apartment here at east 64th street which is right behind me, he may have been confined there for a couple of months but it is a very gilded cage. now the government is putting the 4,000 square foot, seven-room penthouse on the block. the asking price for the

one-bedroom apartment with 4 1/2 baths expected to be between $8 million and $10 million. as with madoff's other properties, the two-story apartment has fantastic views with a wraparound tear rarrace g you a panoramic look of manhattan. custom closets reveal the scam artist was really more of a clothes horse. >> bernard madoff had a fondness for shoes, had a liking for shoes and suits. he had over 50 or 60 suits lined up here, dark suits with however many number of shoes here. >> madoff kept over 40 pairs of custom made shoes in his palm beach house. the 8,700 square foot property, five bedrooms, seven bathrooms, 80-foot dock and views of the intracoastal waterway and downtown palm beach is also on the block. proceeds from the sale of these two properties as well as madoff's former home in long island all go to madoff's

victims of the $65 million ponzi scheme. furnishings, artwork, clothing will all be sold separately. back here with bill george whose book is called "7 lessons for leading in crisis." the aspen institute has a study right now on a subject near and dear to your heart having to do with short-term gains looking for short-term gains at the expense of perhaps the long-term viability of a company, of an investment strategy or whatever it is. i mean that's something that you advocate for to a great degree. ignoring the short term to benefit the long term. >> my lesson number three is that you have to dig deep for the root cause. the root cause of the financial crisis, the reason lehman and bear stearns went down is because of short termism. gm got in trouble, it was short

term. citigroup. go goldman sachs, cut their losses, in much better job. >> steve jobs just left the stage. >> okay, move on there. culture, the companies, publicly traded companies especially find themselves in, they have been trained to every three months reveal how business has been and there had better be growth every three months or else you are going to pay for that. do we need to change that zú culture? >> yes. >> isn't that why they find themselves in this short-term benefit at the expense of -- >> how do you change it, and can you change it? >> well, ceos have to stop focusing on quarterly earnings and putting out estimates. >> they are incentivized to do so. >> you put the incentives there for the long term. i'm chairman of the compensation committee at exon. you can't get your compensation -- long-term compensation until you retire. that's 75%. today at goldman sachs they said we should put emphasis on long-term comp.

stock options. but you can't take them right aw away. >> you're chair of the compensation committee for exxon. when i think about exxon, boy, if you're the ceo of exon, you're driven by whether or not the price of oil is high or low. right? i mean in the end -- >> no. >> -- when you drive a commod y commodity-based company, a lot of times it's luck? >> no. you're driven by the long-term of creating term -- finding oil for the long-term in natural gas and delivering it efficiently. because you don't get your comp in the short term. 75% of the ceo's comp he doesn't get until he retires. that's the way it should be. investors bankers shouldn't be getting their cash out in december and have the company go down in january. >> but the investor demands performance and growth as well. it's not just the bonus system. >> you're right. >> how do you get the shareholder to go along with that? >> they have to accept a longer-term time horizon as well. is that feasible? they've been trained to see growth on an immediate basis. >> the long-term wealth created in term of shareholder value,

they create the long-term value. they're not just short term. yes they deliver quarterly results. we did at medtronic every time. we always focus on life saving devices. they create value. short-term players like the old at&t or general motors, they eventually go out of business. sears roebuck. you have to focus on building for the long terl. these companies have to go on offense and focus on winning now and building up their market share globally. that's what will rebuild the u.s. economy. >> the book is called "7 lessons for leading in crisis." we'll continue with bill george here. more on the meeting convened by apple. what they are saying, maybe more importantly what they're not saying so far about john, paul, george and ringo. plus, one year later "vanity fair" is out with an investigative piece called "good billions after bad." a look at how many of those billions of the t.a.r.p. funds have ended up in the wrong hands. your tax money potentially down

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i'm sorry dick butkus. (announcer) we understand. you want to grow internationally. fedex express we are back all monitoring the event there in san francisco. this was moments ago, if you're just joining us. yes, steve jobs did show up on stage. his first public appearance since his transplant of a few months ago. he received a standing ovation.

espoused the positive nature of organ transplants and organ donations. he spent just a few minutes on stage, then departed. and then they got down to business on what they're introducing. our jim goldman is there, live blogging. if go to our website at cnbc.com, you can get a sense of what's being said there. we are trying to ourselves figure out what is going to be introduced there in terms of a new ipod or new incremental applications, new apps on the ipod and so forth. >> let's find out why eric schmidt was there. >> eric schmidt was in the audience, the current ceo of google, a former board member of apple. haven't heard much about that at this point. dan, let's get a sense of what we're learning from apple today. i know you're not there but what are we hearing from them so far? >> i'm following along with some of the live bloggers also. you guys are getting updates, too. we're seeing a lot of music theme stuff. we knew this would be a music-themed event.

itunes 9 has a bunch of improvements to the itunes store, particularly how you think and deal with your music, especially your apps. they talked about stuff like the liner notes which they call the lp style. even with the cd you get a blooklet with stuff in it. for mp3s you get something. i think that's kept people from commit. >> let me cut to the chase. no beatles on itunes yet? >> not yet. we've been reading tea leaves every day. today is an important beatles day for two other reasons. remastered cds are coming out and the beatles rock band video game comes out. this would make a nice trifecta there. >> wouldn't it. >> you got to play it, right? >> i've played it for about a week or so. it is really good. >> which one were you? >> you know what? i switched around a lot. i played some guitar. >> oh, come on! >> you know what? i did a great george harrison in "do you want to know a secret." >> is it any good for gamers out there? is this going to sell well because it is a good game? is it going to sell well because

it is the beatles? both? >> two reasons. one, it is built on a very established franchise which is the rock band franchise. that and guitar hero both very popular still even though people are getting a little bit of guitar game fatigue. they needed a big hit. >> steve jobs is back on stage right now. well, you never know what's going to happen. maybe he'll make an announcement. >> does your gut say that the beatles will be on itunes at the end of the day? >> my gut says no but my guts could be wrong. >> yoko ono -- >> anybody hasn't heard the story, sky news had a stare vor early this morning. supposedly yoko ono told them the beatles would be on itunes. >> they definitely may well be, but not today. i don't think they want to step on those remastered cds. >> you talking two different demographics though. don't you think? the young generation as you pull the beatles into the 21st century, they go into itunes.

those of us who remember the beatles live want to buy cds. >> they've been trying to do this for years. back end problem is the feuding between all the different companies who own a cut for royalties for this music. they haven't worked that out for ten years. it would be great if it happened today. i'd be the first guy to go and download. >> why wouldn't they do it at such a high-profile event, especially with steve jobs' ability to announce it. he's obviously got command of the room. it seems to me like the perfect time and place. >> oh, it makes perfect sense to me. but if anybody has the ability to shoot themselves in the foot with the digital music strategy it's been the beatles. >> who's going to buy this game? the young generation? is this about growing the audience to older individuals who -- >> gamers are actually -- >> is this about introducing the beatles -- bill george? >> i'm going to learn how to play, you bet. >> which beatle will you be? >> i was named off a beatles

song. >> which one? >> gee. >> the average age of gamers right now is 34, 35, actually fairly old demographic. classic rock bands tend to place these guitar games because it is very understandable to them. have you a wide demographic that could be interested in this beatles game. >> dan, we'll find out. the suspense is building in san francisco. we'll see if they in fact announce that. if they don't, i don't know what will happen. >> steve jobs is back on stage. >> i don't know. could there be a couple of beatles in the wings there? >> i would think so. >> paul mccartney was in the hamptons last week. >> bill george, we wish you well with the new book. thank you for spending this time with us. >> been a pleasure being here. "7 lessons for leading in crisis." a book, as it happens, put together by an old friend warren bennis as well. thanks for being with us today. when we come back, another developing story. opec set to start an evening

session in about -- well, it just got underway to talk about the future of pricing and production. melissa francis is live in vienna set to tell us what the cartel is planning. they had to do an evening session because of ramadan. couldn't work during the day. alan greenspan tells cnbc he believes housing will be stabilized by the middle of this year. is he finally right? seeing signs of life? a trip across america to the front lines of the hope front minutes away. uuuuuuuuuuuuuuuuuuu

welcome back to "power lunch." here are some of the stories we're following at this hour. it is all about apple right now. steve jobs walking out to a standing ovation, looking thin, speaking with a scratchy voice. he thanked everyone for their support. beyond that though, apple has sold, it said, 30 million iphones. 1.8 billion apps and more than 220 million ipods. he also introduced an i tutune . apple shares at this hour trading at a 52-week high. waiting to see if there are any other announcements. >> there had been such a decline

in album art and i really like album art. opec ministers getting their meeting y ining underway in aus right now. melissa francis joins us live from vienna, austria with the latest. >> reporter: michelle, do not call them a cartel. remember, they're not a cartel. they're really big about that at the last meeting. compliance is one of the huge issues here. compliance is at about 70% of the quota. to add insult to injury, russia has under its production. they aren't a member of opec but they said in december they'd pull some oil off the markets if there wasn't a flood of oil on the market. they've done exactly the opposite, increasing production to 7.4 million barrels a day. at the same time saudi arabia has cut their production to about 7 million barrels a day according to the eia. still, saudi arabia's oil minister was out a little bit earlier talking to reporters and playing down that issue.

>> 70% is great. $70 price? >> reporter: there's another wrinkle in the plot. venezuela's oil minister rafael ramirez, always a big fix tur at these meetings, he's not here. guess where he is? he's in russia. granted, hugo chavez is also in russia right now in moscow but still it sends a clear message to the rest of opec, trying to good a spin on it, saying maybe he's trying to smooth things over, broker a deal. but if you look at it the other way, he's a big dissenter in the group. he could be building an ally against saudi arabia. >> thank you, melissa francis. crude is sitting above the $70 a barrel mark, $72.18. but our smart money guest says it won't be there too much longer. joining us now with his oil plays, oil analyst at deutsche bank, paul, good to see you.

as you look ahead at 2010, you look at considerably lower prices than thr we are now. what's your average price? >> looking for $55 on average next year. that is a long way below where we are now. >> what will drive it to that point? >> as you know, the fundamentals here are driven by saudi arabia. if you want to know the difference between the actions of the saudi and opec and just the fundamental market, look at ratio between natural gas prices and oil prices. an all-time high. the difference there is what saudi has done. they've been quoted as saying they're happy with the price where it is now. that is to say we don't believe they want it to go any higher and we believe they'd prefer on balance if they had to choose it to be lower rather than higher because of the risk to the world economy and alternatives fuels if they do allow it to go up. >> given that forecast, how are you playing this? what would you buy in this particular arena and what are you negative on?

>> i must highlight, i'm afraid, we are very bullish on the dollar into 2010. that's crucial because the additional element here beyond the fundamentals obviously is how you see the dollar performing over the next six months. without the dollar strengthening we won't get oil where it's going. we like companies with low-cost strong balance sheets, exon and oxi. we'd avoid oil leverage, that's more of your hess or conocophillips. we are outright negative refining particularly b ll ll l. >> thanks, paul. one year after the crisis began, we wonder if we're starting to see real signs of improvement in the housing markets. one of our favorite segments. we'll look at specific markets with real estate reporters, local reporters, see how they're doing right now. last year then-treasury

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unless and until the price of homes in the united states stabilizes and i envision that occurring some time later this year, early next year, until that occurs, you don't have any really solid base to know what

the equity in homes are in the united states. >> that's former chairman greenspan last year, a year ago today, with his forecast on housing. of course a key factor in the financial crisis, does it become a key factor in the recovery. joining us from various parts of the country with their assessment of their local real estate market, dan lee, a business columnist at the indianapolis star. aubrey cohen, a reporter at what's now known as the seattlepi.com, and a staff writer at the "miami herald," and our own real estate correspondent to the discussion as well. gentlemen, your very quick assessment of whether you believe based on the criteria set by chairman greenspan, have prices stabilize? do you sense your market is stabilizing in real estate? dan lee in indianapolis first. >> i think he got close on this. things are still bad but getting better. i was just talk with a realtor. he said the market for $225,000

and under is fairly vibrant, though nothing close to a few years ago. people are really taking advantage of that $8,000 tax credit. although he said that lenders, even people -- buyers, even people with very strong credit scores are having a hard time getting the mortgage insurance. it holds up sales. that's still a problem. >> but stabilizing basically. >> yes. aubrey cohen in seattle. >> priced aren't really going up yet. we've seen a strong increase in sales driven largely by the tax credit. think people deciding that the markets gotten close enough to bottom, if not at bottom, that it is a good time to buy. real question's going to be what happens at the end of november when the tax credit goes away. >> matt, how are things in the boom/bust town of miami? >> our market swings wildly and we continue to swing down. however, sales are up and inventory of unsold homes is decreasing so things are

improving but still not at bottom yet. >> chairman greenspan pointed to prices. are you seeing a stabilization in that? >> no, not yet. prices are continuing to decline and we -- and until we actually get more of a balance between buyers and sellers, we won't see that stabilization but we're getting closer. the months of inventory typically with stabilized prices are 6 to 12 months. a year ago they were at 35 months. right now we're at about 19 so getting closer but not there yet. >> diana, overall it sounds like improvements on all the key numbers that we're talking about from all of these different markets. >> if you're looking at the lower end of the market, yes, we're seeing improvements in prices and in sales across the board, inventories coming down of course. it is a very bifurcated market, because once you cross that quarter million dollar mark on the home price, you're seeing sales continue to plummet and prices continue to fall. you are not seeing the move-up buyer, that is the real, true, organic buyer, in a housing recovery.

right now you're see the bottom feeders get in -- trust me, there's nothing wrong with that because we need to get rid of all those properties out there and dispressed sales, that's very important. until we see that organic, move-up buyer, you can't say we've recovered in all sectors of housing. >> friday mitch daniels was with us, talking about the economy in indiana. you have a relatively low unemployment rate. >> inned wider indianapolis area, it's fared pretty well. most of the unemployment in those counties are single digits, 6% to 8%. where we've been hit hard in the state is the smaller industrial cities, elkhart where the president has been, upwards of 17%. automatic mo automatic, the governor is in

china looking for more jobs. >> matt, we heard about banks not lending. can you remedy the job situation to a certain extent and get a little bit of demand but if people can't get loans that's not going to help the situation at all. >> there is some loosening of credit but it is worth pointing out our job situation continues to worsen. unemployment has doubled in the last year and in fact it's likely going to grow as we see our local governments poised to lay off thousands of workers now as they're starved for money with taxable revenues going down so much. >> running out of time, guys, it is like you guys running out of space. at the seattlepi.com, you have all the space you want. are jobs as important to the real estate market as they are in these other cities? >> for sure. we've seen here as in other parts of the country, the foreclosure problem has moved into the prime mortgage market indicating the problem is less about bad loans or people who shouldn't have gotten loans

getting loans as it is about people losing their jobs. and i would say that we're looking to next year. recovery seems to have started but we are looking to next year for employment to start to turn around. that's a lagging indicator. >> dan lee, aubrey cohen, matt, thank you all for your assessments. diana, we'll see you later. big banks got big bucks last year but how did they spend it? we'll follow the money. plus, erin burnett joins us around the water cooler. she's set to talk to representative barney frank. we'll give her a couple of suggested questions from our group. tdd#: 1-800-345-2550

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it's like to take a moment and thank everyone in the apple community. >> that was steve jobs talking to the crowd in san francisco. in "street signs," jim goldman will make his way out of that event and give is his play-by-play moment. >> we didn't know if he was going to appear or not. did he. last october congress passed the emergency economic stabilization act of 2008 putting $700 billion into the hands of treasury to bail out the nation's banks. a moment of vanishing credit and peak financial panic. the new issue of "vanity fair" takes an in-depth look at where the money went and how casual the application process was. here now, two-time pulitzer prize winner and "vanity fair" contributor james steele. good to see you. >> nice to be with you today. >> i was struck by if you wanted money from t.a.r.p., again, to play devil's advocate, it was panic. they were trying to get this money out to the banks very, very fast. isn't some of this stuff inevitable? one of the things that struck us about rid of some of the toxic assets. loans that had been such a problem for banks. as you know not just to us, you had the government accountability office look at there were no internal controls to even see where this money went. >> all right, unfortunately, we got to go we encourage to you read the whole article, henry p joining us today. top of the hour. we'll give erin burnett some suggest questions for her interview with barney frank here. >> not that she needs some. "power lunch" is back in two minutes.

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things like malpractice preform in health care, financial services. >> he's financial services. what does he care about health care reform? >> well, i think he's got a lot to say on it. >> does he? >> really curious whether they have all those votes. i know there is all this debate. people say maybe they have it, they don't need any help from massachusetts, in terms of a replacement senator when it gets to that side. >> i'm curious on that. we want to ask about that, whether it is strategic. he's kind of saying right now, look, i don't have jurisdiction over bankruptcy but if they don't speed up this process at the banks? i'm going to try to get that jurisdiction and put it in the bill. >> he's threatening them. interesting to see what the tipping point will be. >> you know what people in the hedge fund industry say barney franks behind close is more appeasing to them.