the second thing is, we're now sitting one year after lehman brothers collapsed, and the financial crisis really hit the point at which we were staring into the abyss. what have we learned from that. what's washington learned, what's wall street learned. i think that's something worth talking to him about. we've also got tremendous questions, erin, about the budget deficit going forward. $1.5 trillion just in fiscal 2009. where do we go from here, what's his plan for bringing that down. >> thank you very much, john harwood. we appreciate it. let's send it off quickly to mary thompson with breaking headlines. >> source close to the new york attorney general tells cnbc that the attorney general will be filing charges against several high-ranking officials at bank of america within the next several weeks. you might recall that the attorney general has sent a letter to bank of america several weeks ago asking that the banks reconsider their use of an advice of counsel defense, along with attorney/client

privilege. this in, of course, the concerns that the attorney general had about several actions that were taken by bank of america executives concerning the acquisition of merrill lynch. most notably, that some material information like growing losses at merrill lynch were not revealed to shareholders. bank of america did send a letter saying they're not going to use that advice of counsel defense. the ag says in several weeks we should expect some charges against high-ranking officials. now to the "closing bell." we're on the floor of the new york stock exchange. in the final stretch with the market reversing, losses now in positive territory. hi, everybody, welcome to the closing bell. i'm maria bartiromo. a lot of activity down here with the president on wall street giving a speech earlier. technology is one of the leadership groups on the up

side. bar none. a number of tech names doing quite well today. that's one of the reasons that this market turned, erasing earlier losses. and now in positive territory. we have a story in oil and natural gas. natural gas prices up 12%. we'll get into all of that as we bring in bob to talk about this. off about 12 points.. what turned it around? >> i think the important thing is here is general electric was a real factor in this whole thing. the important thing is we started weak throughout the day and started going up. remember, this is our parent company. $15, folks. general electric has not been $15 since, well, you've got to go all the way back to january. >> a lot of people were talking price confidence and going into the analysts' meeting. clearly money moving into the stock on the expectations out of the meeting. >> exactly. the important thing is, and people say technicals don't matter. folks, i wish you could sigh the volume chart.. about a half an hour ago, the second ge hit $15, boom, volume

spiked up in general electric and a lot of other stocks turned around. so technicals do matter. it did help ge in the move up here. >> and boom, we had the market -- >> i get paid for sound effects, too. let me show you a couple of other things that are moving. jpmorgan, i noted earlier in the day the weakness in the financial stocks, they have been underperforming the markets the last week and a half here. throughout the morning, most the major financial names also moving on the up side. jpmorgan now the leader in the dow jones industrial average. other thing that's been happening is volatility has been dropping throughout the day. take a look at the volatility index. the measure of the cost of buying options on the s&p 500. puts and calls, that's been sinking here. right now we're at the lowest levels since mid-july here. the important thing here is something's going on regarding options hedging. finally, how about some other potential breakouts. here's one i like. a couple of traders mentioned it

today. ibm is sitting right near $1.20. it hasn't been able to close above $1.20 for a long time. if we get above that level, i think you'll see a breakout here. for more, let's go around the horn and talk to all my friends. scott wapner. >> a good look at ibm there, and the momentum coming into that stock. nasdaq, money coming into technology today. nasdaq ahead by 0.3%. the reason the move to the upside is somewhat muted is because it's a mixed picture along large cap widely held technology stocks. for every dell that's down, 1.5%, apple higher by 0.75%. microsoft did get an upgrade today. google to the up side today. up 2.5%. the six-month price target increased up to $4.55 at goldman

sachs. e trade financial, another big winner today. it's up almost 8%. upgraded to buy over at citi. the price target to $2.30 from $1.50. take a look at other movers today. cognizant to the down side. it got upgraded for solar. down 2.75%. rosetta resources downgraded today. let's go to rebecca jarvis.s. >> thanks, scott.. while you're seeing money flowing into tech, we are seeing some money flowing out of the commodities complex. in fact, a number of commodities were down on today's trading session. what are people looking at when they look at that thing that's taking place? especially they're seeing tougher, tighter regulations, v position limits on top of that

the u.s. potentially being in a trade war with china. the world's number two energy consumer. and the fact that the world's number one energy exporter, i'm talking about russia, is seeing a major contraction there in the economy of terms of what they are sending out to the rest of the world. that's certainly having an impact on commodities today, as is renewed questions and concerns about demand. not is it going to be destroyed further, but will it really come back. what's actually baked into the numbers here. interesting to note, two major outliers in the commodities complex today, heating oil and natural gas both ended the session higher on today's session. 1983 is the last time heating oil stocks were at the level that we see them at. these are near all-time highs. in disilate stocks, the commodity higher on today's session. also, natural gas, very interesting to note today, and we heard from maria at the top of the program, up big-time today. goldman sachs out with a rather

relatively bullish note on natural gas, and the futures demand and supply equation.n. >> well, we all know about extreme markets.s. no doubt the equity markets have been pricing a bit extreme to the upside. here's an extreme chart of the currencies.. look at the dollar index and realize on this two-week chart, starting on the 3rd of september, we had six straight lower closes to the dollar index. right now, even though it's a close call, and it looks like we might end that streak. now, let's look at a market that is extreme with this historical perspective. interest rates are still relatively low, forgetting that we have negative cpi, which actually makes rates a little higher. but consider that on a two-way chart looking at a 341 yield in tens, it's about in the middle of its range. we've covered this range quite a bit. what might change this? tomorrow we have a lot of data, retail sales, ppi, empire index, no supply, lots of data. bob and maria, back to you.

>> rick, thanks very much. rick santelli. we're now welcoming to the programmer rick ross, director of equity research, along with daniel, chief investment strategist. nice to have you on the program. a lot of action down here today. the president making a speech earlier on financial reform. and i was happy to see that the crux of the speech, because a lot of people are worried that the financial reform is being pushed to the sidelines, because health care is really dominating the agenda right now. >> it's a tough situation for the president, because he's got to get the health care reform through. i see some light here. it's got more support from the american electorate right now. financial reform, who's against it. really, unless you go on the extreme level. >> we still have the problem of the toxic assets sitting on many banks. we still need to work through those. we need to work through them. >> they're sitting there, because it turned out that you

didn't really have to buy them back. all you had to do was change the adobe accounting rule and the whole problem went away by itself. it was a bit of a cover-up in that they could have changed that rule a long time ago. when they didn't do it, the rule that said you had to mark those bonds to market. when they didn't do it, and they got so far down the road, it was very difficult for them to do it. so they had to wait for a new administration. but all of those problems that were caused probably by the accounting rule. >> and time, you know, some of these firms will tell you that they needed time to put valuation to stabilize. look what happened to credit suites, which gave their employees those assets as bonuses, which worked out great for them.. >> we're going to have some kind of regulatory reform. >> right. >> we're going to have a consumer regulatory reform come out. >> and that's debatable. >> he mentions it every time. >> he does. it's debatable from others who

say maybe that's too much bureaucracy. >> but everything else being up for grabs at this point. >> there are always going to be unexpected consequences. every time they do these things, they don't really ups the things they're changing.. but it looks like what they're going to do is going to be modest. and there are a lot of smart people who will figure out how to do the deals they want to do. and being too leveraged is not a good idea. there are a lot of things that are goinin change that will tighten things up. >> once again, we have a situation where we've got a kind of slow market here. it cannot drop. it tried a few days -- two weeks ago and went nowhere. again, we're popping up ready to go to new highs. goldman at a new high. financials going up. jpmorgan is about to break out here. >> it seems like everyone came back from vacation last week and the trend is up. 2.6% move up in the s&p 500. you have 93% of the nyse above the 200-day moving average. at least on the stocks we have,

73% advanced last week to very, very broad upward movement. even though the market's overbought, it still looks like it's going to continue for some time.. >> technical talk once again. >> and cash on the sidelines being put to work. it's not just put to work in equities. oil up better than 50% this year. natural gas up better than 10% right now. money moving into energy. >> moving into the raw material. moving into every early cyclical growth investment. it is an economy story, absolutely. and what's happening is, that the economy's growing much -- it's improving right now incrementally. you're going to see signs of it when they report numbers in october, then you're going to see it again with more growth in january, february. they're going to be reporting it.. but the growth is taking place now. and the market is discounting.g. by the time we get to #% gdp growth, they're going to be

talking about 5%. because we're serial extrapolators. the market is going to discount 5%. whether it ever happens, i don't know. >> do you want to be buying the economically sensitive companies? >> i think the market continues to go up, i would recommend being a little bit safe. like natural gas, we're not buying natural gas straight out. like the mlps, in order to play natural gas in the pipelines, we're paying 12%, 11% dividend. >> you've got 30 seconds. one year after lehman d the government do the right thing, stepping in and aggressively supporting the remaining banks? >> yes. >> i don't think it mattered. they didn't hurt too much. and it was okay. i think it -- somebody would have stepped in, and probably people who have stepped in and actually bought those assets, and everything would have been the same, except it would have been private. >> i think we needed immediate

liquidity to the market.. >> we were trying to buy those bonds cheap and you couldn't get them. they weren't really there for sale. they were just on paperer >> gentlemen, great to have you on the program, as always. appreciate it. >> if you can't beat them, join them. eli lily, cut costs and remodeled itself. the pharmaceutical reporter mike along with the details right now. >> including today's news from lily, so far this year challenger gray and christmas said the drug industry has announced it's getting rid of more than 53,000 jobs. that is more than double the industry's downsizing number at this date last year. so unfortunately, job cuts have become a common occurrence. the headline on the home page here for the indianapolis "star" shows it's big, important news in lilly's hometown. the patents run out on some of the top selling drugs next year. they'll face competition from cheap generic pills. lilly doesn't have enough new drugs or promising ones in its

pipeline to absorb the huge hit to the top line.e. that's why it's eliminating nearly 15% of its work force, or 5,500 positions by the end of 2011. lilly says it will save $1 billion a year by doing so. at least one analyst has suggested the company may also need to do a big deal, but in a first on cnbc interview on squawk on the street this morning, chuck said that is not in the cards. >> we have no interest, mike, in a major large-scale combination. that hasn't changed. we've been very consistent on that over the past several years. instead, the changes we're making will enable us to do what we think we do best, to discover and develop innovative new medicines. >> lilly is also splitting up the company into five new business units. lilly shares are in a tug-of-war right now to be the biggest dollar and percentage gainer in the pharma sector today. officials will give more details on this corporate makeover at their annual meeting in early december.

in the meantime, lilly their partners are waiting for fda approval for the once-a-week diabetes drug. check out their blog and you can follow me on twitter.r. bob, back to you. >> thanks very much, mike. our next guest has a really strong record on wall street. a strong track record. he just opened up a brand-new fund. why he chose to start one right now and where he's finding out. >> after the bell, one year after the lehman collapse, we continue to look back, and look ahead. morgan stanley chairman john mack and citigroup sits down with me and gives reflections of what was it like the last year. and most importantly, what's ahead for the financial services sector. we'll hear from those two gentlemen. >> the most actively traded stocks led by citigroup. i drove my first car from my parent's home

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welcome back. let's take a look at some of today's research calls. the latest upgrades and downgrades.

dreamworks animation, outperformed citing a strong late of upcoming films.s. and the potential for the studio to be a takeover target following disney's acquisition of marvel. boston scientific down from neutral on expectation of the heart devices will be hurt by increasing competition in that space. goldman sachs reiterating the buy i buying point on ge. the meeting this week could be a catalyst to focus investor attention on the organic growth prospects. ge breaking out, up 4% today. >> 79% of investors think that the stock market is resilient and will produce long-term gains. that positive sentiment is welcome news from my next guest after launching his own fund less than two weeks ago. from san diego, chuck, ceo and portfolio manager of the fund. thanks for joining us.

>> thank you, maria. >> what was your goal in starting the fund in your own firm, just a couple of weeks ago? why start the focus fund now? tell me what you're looking to achieve. >> well, a couple important reasons. the first was that we wanted to be able to have direct contact with our clients and the advisers who are -- who put shares in the fund.. and we were not able to do that in our subadvisory arrangement. number two, we want to be able to take control of our own destiny in managing this business. as we managed the other fund for nearly 13 years. and there were just some parts about that that we wanted to change. so we think the timing is terrific. there's some great bargains in the market today. and we think that there will be over the next several months as money comes into the new fund. >> mr. akre, what are you hearing from investors? you are now at the largest gathering of the independent

investment advisers, from that schwab impact 2009 investment. what are you hearing from investors right now? do they feel they need to be changing straight jis as a result of changing political and economic winds? >> well, there's no question that the experience of the last 18 or 20 months has caused everybody in the investment business to re-think, you know, what their strategy has been. the old adage that if you own common stocks, periodically they'll go down 50%, is something we've all been aware of. and yet most of us were caught a little flat-footed in the liquidity crisis that occurred when things went down 50%. so yes, investors are re-thinking what they'd like to do with their money. and it's our view that they're searching out managers such as us who have a long-term record and a long-term strategy for investing in terrific compounding businesses. >> and beyond looking long term, what are your screens in terms

of investing? how do you pick stocks, how do you pick areas that will be long-term performers for you? give us your screens. >> well, great. you know, i mean, our first piece of the screen is we look for a very high return businesses, and that through our research, we believe are going to continue to be high return businesses. that is, their economic mode is durable. and we've learned a lot in the last few years about how modes change in size and scale. so we call that the first leg of our three-legged stool. the second leg is we look for managers that have a terrific record running those businesses. and who make sure that what's happening at the company level is also happening at a per-share level. and thirdly, we look for businesses where the opportunity to reinvest their excess capital at attractive high rates of return also exists. we just won't pay very much for those businesses.. we sometimes refer to that as our three-legged stool where pe

put an evaluation overlay over the top of that. the places that we look -- go ahead. >> whar the places? are there areas that look particularly attractive right now? i see you're avoiding biotech and technology.. why is that and what do you like instead? >> well, you know, we've always avoided biotech.h. we really have no capability internally to understand, you know, the nature of those businesses, and the valuations that they put on particularly young biotechnology companies. as it relates to other businesses in the -- in what we broadly think of the technology sector, again, our ability to understand the durability of those individual products is not high. but usually they're accompanied by very high valuations, which we're just not willing to pay. and so, you know, in areas like, oh, wireless telephony, we've been longtime holders of companies like american tower, the perfect infrastructure

company in the wireless business. a business that's still growing importantly, and even in this environment. that's a great place. there are certain financials that are selling at book or below book. and in places where we're able to make good sense of their balance sheets and know the management some of those places are very attractive in this market. and other reasonable consumer businesses that aren't dependent upon vigorous spending on the part of the consumer.. but auto parts companies, that sort of thing, we've owned o'reilly for years and think it's a terrific business. we obviously don't disclose what we're buying in the new fund, because we've only been getting money in for a week and a half. but you can expect that we'll be fishing in those ponds that you're familiar with from our other focus fund that we manage so successfully for 13 years. >> best of luck with it. thanks very much. >> thank you very much, maria. >> chuck akre, ceo and portfolio

manager. it's been one year since the start of the financial crisis. but has wall street learned its lesson or is another meltdown inevitab inevitable? >> tonight on cnbc, john harwood's exclusive one-on-one with president obama on the state of the economy and wall street regulation. all coming up at 6:30 p.m. eastern, in our special report. then tune in at 8:00 p.m. eastern for our two-hour special one year later. the week that shook the world. mark haines and erin burnett will take you back to last year's financial meltdown.. where we are today and where we are headed. don't miss this one year later presentation tonight at 8:00 p.m. on cnbc.

let's look at the widely held stocks here. as you can see, the financials really mixed, although a number of financials are actually up at 52-week highs. >> goldman sachs, jpmorgan, sitting at a new high for the year. wells fargo holding up, not quite a new high there for wells fargo. citigroup not doing too much. but still close to $5. bank of america kind of in the middle of where it was throughout the year here. it was as low, what, $4, i guess, earlier in the year, now $15. in fact, pre-lehman days, that was about a $30 stock.

>> ge also widely held, not on that screen right here. but that is one of the big winners on the session. in fact, without ge, it would probably be negative on the dow jones industrial average. stock up 5%. >> the one-year anniversary of the failure of lehman brothers. but charlie gas pa rino, thinks wall street is setting itself up for another meltdown. he joins us now to explain why. it is november, right, first week of november? >> november 3rd. you can probably get copies earlier. but november 3rd is the official date. j maria and i are waiting. >> i will give you both signed copies, no problems. >> good. i really want mine signed. >> i forgot what i was going to say now. >> what were you going to say, charlie? >> this is actually a serious subject. you know, i wrote a column in the new york post quoeg today which essentially that the federal government -- the president gave the speech today where he talked about the need for more regulation, basically told -- basically admonished

wall street for risk-taking ways over the last, actually, if you look back, three decades. that's what i tried to look at in my book. and in the column in the new york post quoeg today where i said this just didn't happen now. this happened at least three major times over the last three decades, where excessive risk-taking led to fairly major losses. each time the risk-taking grew. and with worse results until we had the final sort of major worst result last year. the reason why the risk-taking grew, guys, is because it's my contention, and backed up by the evidence, is that every time wall street engages in one of these risk-taking policies, the federal government came in, either directly in 1998, the ltcm crisis, when that hedge fund blew up and weather worried about systemic risk there, the federal government came in and bailed that out. through direct intervention or massive lowering interest rates

and lessening the pain on wall street. and the point of what i'm trying to say here is that when you look back at the last couple years of wall street, you remember, the system blew up last year. lehman declared bankrupt last year. but the problems actually started in early 2007. you've got to ask yourself, why didn't wall street take steps, why didn't, for example, bear stearns take something to do something sooner. one of the reasons why is all the toxic assets on their balance sheets, the heads of the firms believe the fed would come in and save them. they would cut interest rates so low, add so am liquidity to the system they didn't have to go out and seek capital and merger partners until it was too late. i open up my column today in the "new york post," that stan o'neill back in the fall of 2007, went to his board twice and said the first time he said, listen, i have essentially a deal from bank of america to -- stanley o'neal of merrill lynch,

i have a deal, you know, though not signed, they have agreed to basically seriously look at us for $90 a share. this is back in september 2007. in my book i go through the chapter and verse on exactly how it went down. the board said no. you're selling out too cheaply. then he went back another time, again said he had a deal. remember, merrill right now is suffering from major losses because of the toxic assets on the balance sheet. went back about a month later and said i want to do this deal with wachovia. the board said no again. the reason they said no is they firmly believed that the toxic assets would recover because the fed has always done this in the past. i guess my point now is, there comes a time where, you know, listen, there's a concept of moral hazard, you create moral hazard by bailing out companies and entities and they act differently afterwards. if you look at one of the root causes of the failure to act swiftly, of the failure to merge faster, the failure to get

capital sooner, i believe it was because moral hazard was created all these times. here's how they're creating it, bob, they're creating it because they declared every one of these guys too big to fail. they are systemically important banks. that means goldman sachs, morgan stanley, all the rest, can go out and trade and basically trade without consequences. >> but too big to fail doesn't mean too big to regulate. you seem to be thinking there's nothing at all anybody can do. isn't it the centerpiece of the obama administration that there is some kind of regulatory reform even if they are theoretically too big to fail? >> that's a great question. i will tell you, as someone who's unfortunately had to read 30 years of stuff coming out from the federal government of regulation, each time one of these crises occur, that's what they say every time. and, you know, i wonder if wall street can be regulated. if you regulate their leverage, that's their borrowing, do they figure out another way to risk that, that could essentially

blow the firm up. they've done it in the past. by the way, there's always a period of retrenchment following one of these mishaps and wall street goes back to its old ways. >> maybe they -- >> but sometimes these deals s don't happen.. i'm sure charlie will agree because of the ceos wanting to stay in control. they don't want to put a success plan in place. if they merge with another firm, there's competition of who runs the firm. that actually stops a lot of deals from going forward. >> i think what o'neal in my post piece, he had no problem selling merrill out at that point. because listen, he caused what was happening.g. he was toast no matter what. >> that was a good anecdote.. we've got to run, charlie, but that was a good anecdote about o'neal, talking about selling out in 2007. >> in my book i talk about this, the initial deal was with bank america, it shows you how much ken lewis, this was in 2007, he was willing to talk about a $90 a share offer. which is pretty amazing.

>> thanks very much, charlie. >> don't count on a free book.k. go out and buy the book. just put some money up for a colleague and buy the book, bob. don't count on a free book. >> he's going to come to the party and pick one up for free. >> i know it. pay for the book. >> i want the free book. and i want it autographed, too. not far from the highs for the today. gerks leading. jpmorgan helping. maria? >> yes. up next, we're talking about non-traditional safe havens that could help you protect your portfolio in the event of a downturn. it certainly feels like a lot of momentum on the sidelines with money moving into this market. but you never know, september has not been so consistent on the upside, that's for sure. >> i still want a free book.

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welcome back. we're in the final stretch here. about 20 minutes before the closing bell sounds. we've got a market that is breaking outs the new highs, s&p 500 and nasdaq bob tells me both at new yearly highs. not the dow industrials, but the dow is being powered by stocks like ge, which is up 5%. analysts meeting this week. jpmorgan up nearly 3%. the banks virtually higher across the board.d. the oils are really mixed. the drug index also at a 52-week

high. a number of technology names also very strong. let's check the nasdaq, gaining as well. it, too, however, off of the best levels of the situation, similar to the dow industrials. they're just shy of the best levels of the day. s&p 500, new high for the year. looks like this. and again, the one pressure within the s&p, i would say, is some of the oils are not showing such strength. walmart has been trading down recently. that is also in the red today. although very much the financials and technology, the leadership group on the upside.. >> the telecom consumer holding back a little bit, still in the negative here, maria. it's time for the "fast money" "final call." looking beyond the standard safe havens. patty edwards. good to see you. you've been bearish for a while. are you changing your stance at all? >> no. when i've been bearish, i've been bearish on the market

overall. i still have been long individual equities. i really think this is a stock picker's market at this point. if you're going to make money to the upside, and this market has gone up further than i thought it would, you've got to be long in some cases. and then like i said, i like to be short the entire market.t. >> i know you like stocks like philip morris, don't you notice the breakouts going on in the cyclical names we've been seeing? >> yeah. you know, i'm noticing them, but i'm also looking at the underlying economy and realizing at least from my point of view it just doesn't make sense that things are powering ahead as far as they are when we've got things going on, like the new trade war with china. we have the housing bubble that is by no means done deflating. we have consumer who is still absolutely cash strapped and looking at a holiday season that isn't going to be good. i cannot buy into the idea that this market's going that much higher. >> i've been watching traders

fight the tape since june or july and they got blown out in july in that summer rally in the second week of july. you're in the camp saying we're going to move back down later in the year. >> well, yeah, but i think in the meantime there are places you can make money if you're willing to go long some e individual stocks. >> give me a few. >> all right. i've already been talking about apple now for a week or two. apple at about $172 a share, i think this really does go to $200. we've got a phenomenal pipeline sitting out there, gadgets they've already got, that people are going to be willing to trade up to. we've got a consumer who is not spending on much of anything. and yet they're still buying gadgets. if there's one must-have item is an iphone or itouch. i think you're going to see pretty darn good sales out of apple. also the only busy place in the mall right now. >> did i hear you mention comcast at well? at one point i thought you were interested in comcast. >> i am absolutely interested in

comcast. because people are not going out as much. we're seeing it in the restaurant numbers. people are pulling back on the spending that they're doing outside the home. we're even seeing that in the retailers. they're saying people are spending more on the home. if you're spending time at home, you're still going to have cable. you're going to watch the video. if you can get a better bargain by combining your internet and your phone with them, you're going to do that. they are seeing really nice growth for that. but they're also picking up small and medium sized businesses. between those two drivers, i think you've got a fairly decent safe haven out of comcast. >> patty edwards, thank you very much.. the big story of the day, obama's tariffs on chinese tires. carlos gutierrez joins us with his take. plus the deal that continues to haunt bank of america. top ranked financial analyst with the company's latest legal woes. live at 5:00. up next, strategy session.n. wells fargo, chief investment officer will be here. hear his strategy for recouping

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welcome back. my next guest says investing is a lot like golf. it's not about your most memorable shop but about making fewer mistakes with less severe consequences. chief investment manager at wells fargo. a week-long series focusing on where to invest now. making -- >> happy birthday. >> thank you very much. tell me about your strategy in an environment where the market has done so well. and you're looking out long term for wise decisions for the portfolio. >> i think that what investors should be thinking about today is taking away something from the tough times that we've experienced over the past year or two. and i think that one of the

things that they need to remember is that investments like golf is a game of mistakes. ben hogan, one of the best golfers of all-time basically said in a round, maybe one or perhaps two shots were as he intended. so becoming a better investor is about making fewer mistakes, and making mistakes that are less severe. those mistakes over the past ten years have been tech boom bust of 1998, 1999, and thereafter. and the housing boom bust as well. if one had just been able to prepare his portfolio, or her portfolio to protect against those big mistakes, you could have done a lot better.. >> the mistake being that i didn't realize i was in a bubble when i was in a bubble? >> right. one has to -- even if one owns an index fund, even if one owns the s&p 500, you have to understand what the sector ratings are.e. you have to understand if there's a particular group of companies in your portfolio that

is responsible for an outsized portion of the gains, one has to be concerned about that. and worried that those gains might turn into losses in the future. >> some people say you never know when you're in a bubble when you're actually in it. do you find that there are areas of this market, maybe asset classes, that feel bubble-like to you right now? some people might say, all the money that's moved into treasuries feels like a bubble right now. i don't know how you feel about that. >> i wouldn't really call treasuries a bubble, say, like jim rogers would. i think treasuries don't offer good value as far as i'm concerned. i think the risk is that one might achieve a very low return after inflation if you own something like five or ten-year treasuries and plan on holding them to maturity. but i think that looking at the stock market today, we don't get that same sense that we did, say, the foreboding before the housing bubble or even before the technology bubble that there was some outsized gains in a particular sector that represented a very risky investment.

>> what are the screens that you look at? let's talk about strategy. you look at companies for the long term that are paying out dividends. >> yes. >> let's talk strategy.. >> i think that a dividend growth investment strategy makes a lot of sense. i think it's probably the basic investment strategy to buy companies, own businesses that have the ability, number one, to sustain a dividend even in difficult times, and number two, to be able to grow that dividend, sustainably over time. we're not looking for high yielding companies, because many times companies pay out a higher dividend that they can -- than they can afford and still be able to grow. what we're looking for is a combination of sustainability and growth, and we'll actually get better total returns over time. >> okay. so where are the dividend payers do you think that -- because in the last year you could have looked back and said, here are a number of areas that are dividend payers, yet some of those companies had to cut their

dividends. >> i think people think about dividend investing, thinking about high dividend yields.s. >> you're looking consistently. >> i own this stock because it has a 5% or 6% dividend. they should look and say, what is the median dividend yield for a dividend paying company. it's something like 2.2%. a company that has a dividend yield of 2.7% or 3% is actually yielding a little bit more, but then if you look at the record of growth for that company, and if you see it's a very sustainable dividend based on the company's cash flow, then i think you can shall much more confident that that growth is going to generate total returns over time. >> are you applying the dividend theme globally? are you looking around the world for ideas as well? or is this a u.s. strategy? >> i think it makes sense around the world. but obviously that requires a lot more research and analysis, right.t. >> okay. we'll leave it there. tom, always great to talk with you. >> my pleasure.

thanks a lot. >> chief investment officer at wells fargo advisers. a week-long strategy continues with a lineup you don't want to miss. tomorrow we talk with barton g biggs. and we continue, strategies for investing for the long term. yahoo! making a move that's got some investors scratching their heads. tdd#: 1-800-345-2550 if i'm breathing, i'm thinking about trading. tdd#: 1-800-345-2550 i always have my eye out for a stock on the move.

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welcome back. let's take a look at some of the most widely held tech names are trading. most to the up side. apple, a new high. google, $475. i believe that is a new high for google as well. ibm, wait until it hits $120.. that will be a significant breakout. microsoft also doing fairly well here today. maria? >> last thursday carroll looked at the stakes in a chinese site. but it appears a lot can change in just a short amount of time. jim bowman on the story now. >> reporter: maria, good

afternoon to you. carol bart, she is well known for a hard-earned reputation of being a straight talking, straight shooting kind of executive. asked last week on cnbc's squawk box as an example, whether she would have taken that $40 billion deal from microsoft, she had a question of her own. do you think i'm stupid? well, there was also another topic that was brought up during that interview during yahoo!'s stake in alibaba and what an investment that was for yahoo!. >> my belief is the chinese government is much more interested in media companies being chinese media companies. and so i view this as a way to profit from the china internet market through alibaba. i view it, frankly, as a very good investment for the future.. >> reporter: a very good investment for the very near

future. flash forward just a few days later and yahoo! announces earlier today that it's selling its entire stake in alibaba for $50 million. yahoo! will hang on to its broader investment in the alibaba group. but certainly taking some by surprise, especially following those barts comments. yahoo! just reiterated that yahoo! still holds a 40% steak in alibaba group, which holds a 70% stake in alibaba.com. that works out to a 28% indirect stake in the dot-com business even after today's sale. a yahoo! spokeswoman tells me "she was not disingenuous at all." this sale coming so soon after bartz's comments last week. they are raising eyebrows today. much more on the blog as well as

new questions surrounding carroll bartz's compensation package. maria, back to you. >> jim, thanks very much. i am headed out to the fortune magazine's most powerful women in business conference in california. so i'll be back tomorrow. with an interview, bob, with sheila bair from the conference. >> you're jetting off to these things. after the bell, john mack and vikram pandit look back on last year's financial meltdown and tell us how business as changed as a result. we are first in business worldwide. ♪ look at this man ♪ so blessed with inspiration ♪ ♪ i don't know much ♪ but i know i love you ♪ and that may be ♪ all i need ♪ to know (announcer) customers love ge aircraft engines

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