once with hank paulson where we said he's being so reasonable to this, then it didn't sound that way when he went out publicly. anything you would want to ask him? >> i'd want to know what the tipping point is. >> the publix optic option in h care. >> we'll do all of that then. >> that's coming up momentarily. that's "power lunch" for wednesday. see you tomorrow. >> miss burnett is up next. steve jobs takes the stage in a dramatic appearance at apple's ipod event in san francisco. his first appearance at an apple event since his return from liver transplant surgery. microsoft's chief financial officer says the economic climate is still tough but that the worst is behind us. that's cnbc.com news now, first in business worldwide. i'm julia boorstin.

live from our nation's capital, this is "street signs." i'm erin burnett. we're just moments away from the beige book look at the economy. we'll talk to house financial services chairman barney frank and talk about the president's key speech on health care tonight. all of that today on "street signs." first breaking news. >> reports from the 12 fed districts say economic activity stabilized in july and august. majority of districts report flat retail sales. most regions report some improvement in residential real estate market. chicago, richmond, boston, san francisco had an uptick in home sales in the last six weeks. commercial real estate demand for space remained weak and nonresidential construction activity continued to decline. loan demand, weak. credit standards tight in many districts. labor market conditions weak in

all districts. wage pressures minimal in all districts. consumer spending remains soft. cash for clunkers program, however, did help boost traffic and sales in the majority of districts. the same ability, however, of that pace of new car sales is questioned by industry contacts in richmond, atlanta, minneapolis and san francisco. turning to the manufacturing sector now, manufacturers cautiously optimistic as far as their near-term outlook. seeing a modest improvement in manufacturing sectors in most districts. a slight-for-moderate increase in new orders in philadelphia, richmond, atlanta, cleveland and chicago. increased new orders for semi-conductors and i.t. products in the san francisco district. increased auto production in chicago, minneapolis. labor market weak in all districts. slight uptick in temporary hiring in some districts. businesses and local governments imposing wage freezes in several

locations. increases in the cost of raw materials reported in 7 of the 12 fed districts. excess natural gas supplies creating downward price pressures in chicago and dallas. previous beige book talked about an economy where the pace was -- of decline was moderating. today the fed in its latest beige book says the word from the 12 districts is that economic activity continues to stabilize. >> thank you very much. we'll be breaking this down in great detail in a moment. give the market a chance to react. picking up slightly on that. other headlines though crossing over the past few moments, the situation at apple. steve jobs appeared on stage to a standing ovation, thanking everyone for their support. he was there to's spouse virtues of organ donation after his liver transplant. >> i'm very happy to be here

today with you all. and as some of you may know, about five months ago i had a liver transplant so i now have the liver of a mid-20s person who died in a car crash and was generous enough to donate their organs. i wouldn't be here without such generosity. >> certainly a moving statement. tim goldman will be with us shortly with a live report. new versions of the ipod announced at the event. as well as a built-in camera in the back of the ipod nano. getting the market reaction, then we'll break down this beige book. the market's had a couple of moments to react. >> the market reaction is beige,

erin. they're not really doing anything. stuck at a 55-point gain for the dow. 9630 is the near-term high to keep this momentum going. that said we are positive for the fourth consecutive day. what's interesting though is this. you won't hear this anywhere else. look at the outperforms over that period of time of small-cap stocks versus the s&p 500 or even go to the oex, the s&p 100, the bigger big cap. it is clear that there is a demand in the short term in this rally for smaller cap stocks. if you look at the market today, continues to be the industrials up 1.5%, 1.75%. there are 4 of 10 sectors up more than 1% today. health care, discretionary an financials which of course can move this marketplace. seeing strength in aig, again wor genworth. >> on the treasury side we

haven't seen much response in the marketplace. traders are really much more concerned about is the fed and treasury continue to impact the market with things like asset purchases. there's a lot of logistical questions that aren't going to get answered by the beige book. quickly looking at intraday chart. last week we traded at some of the lowest yields since may. all of a sudden at a 2 1/2-week high yield. now at 3.50. if you look at a one-year chart, i picked one year because just like the dollar index, this is the worst dollar environment against that currency any year. if you look at the dollar-yen, i'm putting the six-month chart up. lowest dollar levels against the yen since february. scott, how's the nasdaq response to the beige book? >> we were already having a solid day. nasdaq's up better than 1%, a

gain of just shy of 25 points. money moving into technology. jim goldman will give you details from the big event out in california. you know about steve jobs making his appearance there. just getting information now about the new ipod. once again, sam? 8 gig ipod for $169. and 16 gig for $179. apple rolling out new ipods. it was mostly expected to come out of this. there were rumors about perhaps a beatles announcement. none of that yet. again jim goldman's coming up. shares are in a wait-and-see mode until this whole thing can be digested. ebay moving up. google and cisco at the plus side as well. palm shares were already down today, down 6% on a downgrade

there. alterra getting a little bit of a lift. vivus pharmaceuticals up 71% today. a positive study and some test results related to their obesity drugs. starbucks says 30 stores slated foreclosure will not be and the stocks got a boost off of that information. erin, back to you. so many moves parts today. we'll get more on apple and bring it to you. you just heard the latest from the beige book. what is the situation for the u.s. economy? the banal book can be very important. let's break it down. zane brown, vincent reinhart, vincent, start with you. you heard the headlines.

from across the country some things maybe not surprising. san francisco, pick-up in chips. did anything stand out to you? >> it is consistent with the mixed bag you get at a turning point in the economy. leading indicators are positive. manufacturers getting a little optimistic. maybe they'll start accumulating some inventories. but then lagging indicators, bank lending is still weak. that always lags the cycle. unemployment still weak. that also lags. the bad news that comes out of it is there is still downward pressure on wages. that's a problem for income growth going forward and that sort of runs through the document. >> gary, first i want to get to you. one of the last things hanson mentioned was in all districts the labor market is weak but he mentioned a slight uptick in temporary hiring. does that fit with what you see? >> yeah. that's good news.

that's what you see. there is a management of hierarchy of running a company. you first cut ads, then marketing and advertising, the last thing is employees. you typically see a rise in temporary employment before you do permanent employment. that's what we're seeing. >> zane, what about on this issue on downward pressure on wages? vince mentioned in part what we're seeing in the bond market, more concerns over prices potentially falling than inflation. in your view is that now a consistent story? >> yes. i think it's becoming more consistent. recall when we met a little over a month ago and talked about the last beige book. much more concern in that environment about inflation. though not to offend any of our viewers, but downward wage pressure is really good for treasury prices and for fixed income securities because it kind of removes the prospect of

inflation any time soon and that's really what bond participants wanted to hear. as a result i think you'll find that we won't get a great deal of cheapening in terms of the 30-year. it could have been very easy for some select words in the beige book to put a lot of pressure on 30 years especially in anticipation of the option we have tomorrow. it didn't happen. they're in good shape. >> we did that have auction that went off today of the 20 billion in 10. nobody wants prices to start fall. that would be horrible for the bond market and everybody else. what do you see on wages? staying where they are or is there real downward pressure? >> i don't know if there's so much downward pressure. that's not good for any american. the reality is there is millions of people who are unemployed today. we don't see that. we reported our earnings today. we saw a 20% rise in new business over the summer compared to spring. so that's good news.

there's some green spouts but honestly we need water and sunshine. we need the banking system to continue to improve. the big question is consumer spending, will consumers come back. >> zane, gary, vince, thanks very much to all three of you. appreciate you taking the time to break this down. next on the show, the democratic congressman hank paulson and a live representative with chairman of the house services committee barney frank. will those new security laws include a trading tax. this would be a tax on every trade you make. the afl-cio is here to talk about it with us. i'm here on this tiny little plane, and guess what...

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congress is back in session.

and high on the agenda, health kcare modification. chairman of the house financial services committee and democratic congressman from massachusetts, barney frank is with us. chairman frank, pleasure to have you with us. a wonderful day to do it so thank you. i could start anywhere. i guess i'll start with health care since the president will speak about that tonight. are you confident in figure would come to a vote now that you'd have the roets to get the president's plan through. >> yes, in the house. i think that's clearly the case. it is also clear to me the that jort is there in the senate. one of the things that's happened is we've had a de facto amendment to the american constitution so that you need 60 votes in general to get things through the senate but the senate did provide it go through reconciliation.

i'm surprisedlegitimacy. that flies in the face of democracy, the u.s. constitution and our history. i would hope for there to be more cooperation. i think many on the republican side have decided that since it's important for them to come back from the hole they found themselves in after the last election defeating democratic legislation preventing congress from acting is the highest priority because they believe in the long run the country would be better off with that. that's a legitimate position for them to take but it is one that we have to understand and i believe we focus on getting democratic majorities, which are the majorities that were elected last november, with some republicans then coming along that we'll be able to get a good bill. >> do you need to have a replacement for a ted kennedy to get this through or is that really a separate issue and you think that there are the votes on the other side of the hill to get it through? >> well, i'd say it's in the middle. it will be helpful to get it. we are in a situation where

every vote will count and that's why i support the proposal that's going to be discussed in my state's legislature now which is to let the governor make an interim appointment. in no way diminish the right of the people to elect the successor but it takes time to have an election. we have a very good election administrator. he and the governor ha have set a very prompt date. but i think it would be helpful -- though not necessary, we think -- to have an interim appointment. >> my understanding is that tonight the president is going to not really be trying to get standing ovations. he is going to try to explain, to teach people what's in this health care package. at this point would you recommend that he try to be bipartisan or should he just say, this is what i want, take it as steamrolling if you want to take it that way, but i'm pushing this through, forget the bipartisan effort. >> i have to say i have a personal hope we won't see too many standing ovations because i just get tired getting up and

down like some jack in the box and frankly i think it gets silly with sort of competitive standing ovations. but as i said before, the rule of democracy is you have an election, then majorities in both houses should be able to pass the bill. bipartisanship is not an end in itself. it is a means. if you can get something done on a bipartisan basis, that's fine. in the committee i chair we've had some bills that have gone through, for instance the bill restricting credit card abuses overwhelmingly. others, the bill we just passed in the house to restrict what i think are irresponsible incentives in compensation, that passed in a partisan way. the relevant test is whether it is good legislation and whether it gets the majority of those duly elected in the last election. >> the public option. my understanding is that potentially it could impact about 4 million americans. 4 million of the nearly 50 who are uninsured. that number sounds small when you think about it, yet the public option has become the faultline of the entire debate.

if it were not in the final plan would you vote against it? >> it would depend on what else. i'd be strongly inclined to but it's not simply the number of people covered by the public option but the influence the public option will have on the private insurance companies. the big argument for the public option is not simply people who would participate but the fact that it is a xenttive entity it would put downward pressure on the tendency of the private insurance companies to pay their people a lot of money and make high profits. the public option has a role as a means of trying to hold down costs have people have to pay in the private sector as well. >> is the bill set yet? i know there is big debate over that. for example, "men's health" magazine is going to run an article where they spoke to the president. he said "our kids drink way too much soda. i think it is an idea we should be exploring," that's specifically referring to a soda tax. could a soda tax go in here? is all of that still up for grabs? >> very unlikely.

i guess the other question is will "men's health" have a picture of the president with his shirt off given the nature of their covers. no, you think it is very unlikely there will be a soda tax. >> what about a tax on the top 5% of earners? is that a done deal? >> i hope it is. bill clinton came to office and many of us voted for an increase in the top 5% or so of earners. we had predictions this would be economically disastrous. in the years following that we had great economic performance because that gave us a way to hold down deficits without reducing essential spending on the environment, public safety or transportation. i do think that's one of the ways. but there's another way. i reget one thing missing from this debate is the implicit assumption that american taxpayers should continue to be the police force and pentagon for the whole world. we are spending in my judgment tens and tens of billions of dollars unnecessarily that our

wealthy allies ought to be doing. i do not think either poland or the czech republic is being under danger for being attacked by iran but we've been told to spend public money to put in missile defense for those places. there are places in this federal budget other than health care itself where we can find money to provide necessary health care benefits. >> there are some that say we spend more on the defense than the next seven or ten countries dwind on defense. would you go all the way down to number two? do you think we need to spend more than any other country to be the best? >> yes. the question is by what multiple will we outpend spend our spet tore? 12 times or eight times? we don't have to spend more than the next 20 countries combined to be safe because part of it is, frankly, that our wealthy allies sit back and let america carry the burden. i done think the fight in afghanistan is only to defend america. many of our european allies are

at risk for terrorism which was what was the impulse for the war in afghanistan. but they do virtually nothing compared to what america does. none of them, including very wealthy nations, have anything like the percentage of their gdp going to the military. so without in any way sacrificing american security to do that. look, if we had not gone to war in iraq we could have paid for health care and not had any problem with regard to the deficit. i think the war in iraq was not only enormously expensive but damaging on the whole of american standing. >> one final question -- i wish we could follow up on that. that's the beginning of a fascinating conversation. but i know bankruptcy now currently under your jurisdiction. financial reform is though. numbers came out today on modifications. bank of america has started modifications on 7% of the mortgages that it made that are eligible to be modified. what is the tipping point where you would say, look, you are not moving fast enough, bank of america. we're going to force you or go to the bankruptcy court and let them rework these mortgages

themselves. >> i'm already at that point. you correctly point out, and i appreciate. bankruptcy is under the jurisdiction of the judiciary committee. first, there are legal obstacles to modification. there are first and second mortgages. there is the whole problem of servicing where mortgages have been split up. we shouldn't expect people to want to be going bankrupt. toss not fun and we aren't encouraging it but i think the omgs option of bankruptcy -- you know you can go bankrupt on your second home, your car, go bankrupt and have a modification on everything but your primary residence. i am in favor of including it in our regulatory package which will be moving fairly soon. we've had these i think wishful thinking from some on the right that financial regulations going away. no, we're ready and it will be very much on the floor of the house within a fairly short period of time. >> a quick final question. my producer will kill me but a book is coming out, the authorized story of your life. you want to be hud secretary.

in this administration? >> oh, that was an interview i gave actually before there was this administration. books take time to write. that's an interview i gave probably a couple years ago. i did say this, housing has been one of the things've cared most about. i've been diverted in dealing with the financial crisis but the committee i chair does have housing under it. my hope will be we'll get some good housing legislation. one of my big arguments with the bush administration, they pushed home ownership. i've been for rental housing. for low-income people you do them no favor when you push them into buying homes they really can't afford or maintain in a lot of ways. so so yeah, i said several years out, if we were successful getting good housing programs in there, i would enjoy the chance to make work what i tried to put into law. >> chairman frank, thanks very much. the apple meeting just broke up. jim goldman has the breaking headlines. jim? >> erin, good afternoon. indeed a sign of the times here

in san francisco. that apple event just concluded. steve jobs is at the foot of the stage greeting people, shaking hands, saying hello and, wow, it's been a long time since we have seen images like that. he took the stage earlier today, talked about his liver transplant in an emotional and very candid way, saying that he got his new liver from a mid-20s car accident victim, and then espoused the virtues of organ donation. some big apple news, significant price cuts on the new ipod line. also a new camera coming to the ipod nano, and that could be a direct threat to cisco systems and its recently acquired pure digital, the makers of the popular hd flip camera. as well new additions to the itunes and apps store. significant numbers. we'll talk about them later in the show but apple seems to be really operating on all cylinders right now. the most important headline, steve jobs is not only back, he's in charge, in control and he was leading today's event. erin, back to you. >> thank you, jim goldman.

apple shares meantime down 1.5%. market finding its way through that beige book, giving back a lot of gains. right now up just about 17 points. next on the show, something you've been passionate about, some say sounds painless, others say definitely not. a small tax, .1% on every stock trade. could raise $100 billion or more. is it a good idea? and more on the apple meeting. did steve jobs say enough? jim cramer with the trades and our 1,000% club. who's going over and over... going urgently... waking up to go... it's time to do what lots of guys everywhere have already done-- go see your doctor, because those could be urinary symptoms due to bph, an enlarged prostate. and for many men, prescription flomax reduces their urinary symptoms due to bph in one week. one week. only your doctor can tell if you have bph, not a more serious condition like prostate cancer. avoid driving or hazardous tasks for 12 hours after your first dose or increase in dose,

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caterpillar right now the best performing stock on the dow jones industrial average, up c just about 3% . the market's given back some of its gains on the back of the beige book. we hate nerve last week in a segment about a trading tax. the afl-cio, biggest union in the country, is proposing a .1% -- that sounds small to some -- on every stock transaction. it says a trader tax could raise up to $100 billion a year. at the same time they think it could have another positive consequence, that would be to discourage high-frequency trading that's just to trade,

not to create value for shareholders or fund company stocks that need money. we want to add to this discussion -- the vice president of government regulation at the financial services roundtable, and david lutz, a trader familiar to all of our viewers, let's lay out what this is. obviously this is a tax that's been discussed in the past. britain has a form of it. what would you tax and how much money? >> well, we don't have a specific proposal at this point. we're saying we should be on the table as one way to raise revenues that are needed and also aa way to discourage some of the speculative financial transactions that don't add much to productivity. talking about something on the order of .1%. a tiny tax that promotes folks who will hold their assets for a reasonable period of time wouldn't be water off a duck's back. but for folks who flip these assets a million times in a day,

then it could actually start to add up. but to the extent that creates more stability in the financial system, and also encourages a more long-term investment perspective, we think that's a positive. >> what do you say? she's going after the big high-frequency trading. some made real arguments why that doesn't make sense. you might say, they'll pass this tax along to the regular person with a 401(k) but that isn't a lot of heavy trading. that argument maybe doesn't hold up sglp half of americans owe in tax. they'd be caught up in this tax. it is not water off a duck's back. it's real money being pulled out of the market. >> if i don't move my 401(k) around i'm not paying it. am i? you still have to pay that tax, even if it's a penny. even if you make that one share purchase once a year you'll still pay that tax. that reduces money in the market, reduces your retirement, your savings and hits you even it is a long-term perspective,

that's still $1 or whatever it is per trade. over half americans own stock. it would hit every single one of them. it is the wrong time to put a wet blanket on the market. >> would it hit every single one of them? >> these fees will certainly be passed on. that's a direct tax increase on all retirement accounts. if corporations and companies tend to hold these fees and the big problem rolls out is they'll have to make up for that elsewhere. maybe they reduce head count. theo talked about productivity. for some firms trading is all they do. they hire people, they pay taxes on those people, and those people go out and spend money. we're also looking at the speculator point of view. i agree with oil speculation a year and a half ago, it was a problem and they should be looking specifically in commodities. but as far as speculation to high-frequency trading, it is such a bad idea to go and try to drive these guys out of the market. they narrow spreads, increase liquidity, help price discovery. if you want to root out

corporate behavior, you need somebody like lehman brothers. high-frequency traders provide liquidity. if you have less liquidity, you'll have larger spreads, diminished returns for investors, including afl-cio pension holders. th thea, explain that. >> i think it will have a negligible impact on people who hold pensions and have 401(k) accounts and so on. if you look at the scheme of things, you pay a fee to your broker. if you're a normal person and you have to pay someone, several percent. this is a much, much smaller amount. you pay taxes when you go to the store to buy a loaf of bread. it is not that big a deal. britain, as you said, had a tax like this in place for many, many years. japan had one in place for a long time. it used to raise 4% of japan's revenues. there's nothing sacrosanct when many other activities in society are taxed. >> we need to raise capital, bring $450 billion of private

equity into the markets to help stimulate the economy. u.s. has a 70% of the world market. if we put this tax on we'll lose that competitive edge and it's not pennies. it's going to add up over time. it hits every single person who trades from retirees to account holders. >> if you want to -- at end of the day if they want to target people that are making too much money in the stock market, increase cap gains, increase margin requirements. but don't go ahead and start tax is every single transaction in the marketplace because of the law of unintended consequences. >> thanks very much to all of you. lots of other ways to look at this. there is lots of ways we could raise money but this is one of them. we'll keep talking about it because we know you're all passionate about it. let us know what you thought about this conversation. on the other side of the break, jim cramer with his trades.

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ready to pay a tenth of a percent on your trades? >> you bet, man. that could real lly kill the

market. can people have a little more faith in this market? >> do you really think a tenth -- i'm not saying we should keep tax is. but a tenth of a percent? >> every time we've ever even had a little bit of talk about a trader tax it's caused people to just run out of the theater. we don't need that right now. >> all right. let's get to your games. beige book headlines this hour, seeing strength in chip ordering and i.t. out of the san francisco district. you got a lot of techs. >> when alterra says things are great, you got to go screaming by the xilinx. this quarter's going to be better. we're saying f5 going up. it's very clear this is all part of the mobile internet. cienna going higher.

>> what about -- gout all of those. now, jim, someone else picked up -- don't remember who it was this morning, but in some paper they picked up on what you were the first to say yesterday which is this whole possibility of nestle and hershey. >> i think people who run hershey are terrific. they got a chairman that's one of the smartest guys i've ever met. they've been laying off people, moving plants away. they've become very shareholder friendly. i don't think this is the her s hershey of old. business is strong. >> apple is now down. >> well, remember -- >> are you satisfied with these announcements? >> yeah, but the average decline after an apple -- i always said the same thing. you buy apple up until its announcement, then sell it right before the announcement. this time's no different. there's always been a decline after it. it is no secret, then you buy the decline on day three.

>> the buy the decline on day three. >> not immediately. >> so friday you'd be andle? >> yes. yay, you got it. definitely friday. >> talk about natural gas and the fact that everyone's saying the world is different. all kinds of excuses given for why oil is here and gas is here and every time people say things are different, i get a little nervous. >> look, natural gas is just a one-way ticket down. bob simpson who's made 1,800%, he was very, very clear there is a natural attrition. when you get natural gas down to $2, guys, just stop. they can't produce the darn thing, it ain't worth it, they stop drilling. then is becomes a little bit more like a natural selection. the stronger keep going, the weaker fold and you get a natural move back up to $4, $5. not $10, not $13. that ain't going to happen. you'll have a more to $4, $5.

not this year, maybe next year. i do not believe that we are going to turn -- go to the golden age of natural gas because the president isn't in favor of it. i also think it could go to 4, 5. >> anglo-american taking off the hej hedges, going on gold. jim has a special guest tonight, the ceo of jones apparel at 6:00 and 11:00 eastern. wesley card, jim's guest. next though, "street sign's $2,000 club." we've got one up more than 2,000%. steve jobs back on the job. has he succeeded in silencing his critics and what are traders going to make of that trade jim had? [ engine revving ]

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nushlt volume leaders, ten-day average volume, it is only relative to the past couple of weeks where it was obviously the end of summer, volume was light. at least 40 auto suppliers filed bankruptcy so far this year but one is surviving and thriving since the march 9th low. it is up more than 2,000%. the chairman and ceo of arvinmeritor. thanks for being with us. i know you have been to hell and back, some might say. we were talking about 40 auto suppliers having gone bankrupt this year. we talked to analysts who say arvinmeritor was on that short list but you got that financing and pulled through. is it at this point smooth sailing? >> well, there is no question this is a challenging industry and there is still a lot of challenges going forward.

there are probably still rough seas ahead. i'm pleased with the progress over the last six months and frankly over the last couple years. we continue to both rationalize the company and transform the company. so i think we put a lot of the foundations in place. i think there is a lot of good things going forward and we feel good about it. but at the same time we do recognize there are still challenges when we look at the industry. >> you're in the process of selling a lot of business. your wheel unit is going to be closing soon. is that it? when that's done are we looking at the new arvinmeritor or are there other businesses you're looking to sell? >> that's part of our transformation. that's the second of the three we've talked about this year. first was our chassis business which we completed and announced our last earnings call. then the wheels business which is still in process as we kind of indicated before. last part we've indicated is our body systems business, door systems and sunroofs. we have indicated our intent to move forward with that, go through the balance of the calendar year that way, when we complete that, yes, we'll have

complete the transformation helping transform the company into a commercial vehicle an industrial company going forward. >> what's the demand for autos now post-car for clunkers? >> depends what part of the world you're talking about. no question in the u.s. they stopped that. we've already seen a downturn as demand -- there was that initial rush when the cash for clunkers was out there. in other parts of the world, it is still in existence in germany, though they'll stop it later this year. france has a slow winddown, as in brazil. in different markets depending how they're being wound down it's had an impact as far as slowing it down, hopefully a gradual slow down but with the traction of the industry will help pick up the momentum. >> chinese auto sales doubled in august. maybe you'll say it is not sustainable but you may say, ch china's the biggest car market in the world. >> no question, china's a huge market for us on the automotive side and commercial vehicle

side. stimulus work on the automotive and commercial side. it's going to be an area we'll continue to focus on and i see significant growth potential both currently and in the future in the chinese market. >> chip, thank you so much. arvinmeritor shares up 5% today, up more than 2,000% since the march 9th low. the company obviously got its financing and is not one of the 40 suppliers to go bankrupt. next we're going to wrap up the apple news, have a trade, see if steve jobs got the job done when it comes to the stock and get a reaction to the cramer and get a reaction to the cramer idea. can help save a lot more. amea up to 20% cash back from over 300 online retailers with our add it up program. just sign up and use your bank of america debit or credit card when you shop online. it's one of the many ways we make saving money in tough times a whole lot easier.

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he's back. steve jobs, first public appearance since his return to the company. he got a standing ovation. joining us for an update is andy, the senior researcher there. jim, let's start with you. you've been on a couple times our show. you've heard a little bit more. what are the main headlines as you got them right now? >> you know, the main headlines, erin, are simply new ipods for

the holiday shopping scene, a refresh cycle for this popular device, apple selling over 220 million of them. really the emphasis today, not just on steve's appearance, but also the power of the itunes online music and video download store as well as the ap store. the sheer adoption of these two software programs speak to the idea of the apple economic ecosystem, and it is going gangbusters. the numbers they're sharing today are way above expectations and just goes to show the power of what apple is creating with all kinds of digital entertainment. not to mention that new camera on the ipod nano. now we know why eric schmitt of google was on hand here. steve jobs took the time to point out how popular youtube has become, serving up 1 billion downloaded videos a day. apple needs to be a part of that. that's why the company is introducing the camera to the ipod nano. that's important for cisco

recent recently. the flip camera popular. but apple wants a piece of that video camera pie. >> often the stock sells off a little on these days. he would buy it on friday but thinks it's going up. ge's market cap, our parent, $157 billion. apple's market cap, $153 billion. that's shocking. do you think apple could pass ge? yeah, i think apple could pass ge. i wouldn't be surprised in another decade if apple passes microsoft. the company's a force right now. they have the most popular product in the smart phone industry. they dominate in the entrance-free market. they're gang shares on the pc side. jim and i were talking before the taping here, they have dominant software that really captures their users' minds. i think that's incredibly powerful in generating an erjs stream. >> would you buy it today? what about today? would you buy the stock?

>> probably won't pass microsoft today, but i would buy the stock. i think it has tons of room to grow, both through multiple expansion as people start to get more confidence in their earnings stream. and through continued earnings growth. >> jim, final word to you. steve jobs, has he -- is he going to get the job done today? has he now proved that the company can beat apple without him? >> you know, apple did spend the last 11 months or so talking about the deep executive bench at the company. but all of that is beside us now. this is a company firmly run by steve jobs. did he look a little thin today? sure. was his voice still frail? yes. but the fact is, he did show up today. he is in charge. he is in xrol, driving innovation at this company. and really, his presence here is kind of the only thing so many investors and mac fans really needed to see. i think he indeed got the job done today. >> thanks very much to both of you. more of apple coming up on

the "closing bell." let's talk on the back of what happened in the beige book. brian kelly back with us. this morning you said the main thing you're watching was the auctions in the bond market. ten-year, we've got $20 billion. it was okay. or was it not okay? >> it was good enough. no, it was good enough, absolutely. it was good enough, the yield curve steepened a little bit and you saw a little strike from the banks. and strength in the regional banks which seems to be outperforming the commercial banks at this point in time. >> for the rest of the day, now you've gotten through that. what do you think it will do for the stock side? >> well, in terms of the stock side, i think all eyes are going to be focused on the president's speech right now. we did have a little bit of a sell-off. i don't see a lot of people putting on big positions i head of the speech tonight. so i think we'll probably end up sideways here for the rest of the day. >> they said it was priced in, and anything sort of

nationalization in health care would cause those stocks to go up. it was a pretty aggressive statement. do you agree? >> that nationalization is priced in? i don't think it's 100% priced in. you know, i think that there's still an awful lot amount of unsermt. this morning we didn't know there would be a public option on the health care speech this evening. now apparently there is -- >> come on, you knew there was going to be a public auction. everybody knew that. the news would be if he took it out. >> maybe. maybe. but i don't know. i don't know. i think there's still room for significant volatility on either side of this trade. that being said, i'm not really a buyer of the health care stocks, i would rather buy names that service the health care industry that deal with all the paperwork that's coming down the road. >> brian, thank you very much. >> yep. >> appreciate it. good to see you, as always. and coming up, we are going and coming up, we are going to take a look at the market. if're still one of the guys who's going over and over... going urgently...

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