senate. i will say this, here's the difference that makes me optimistic. when we were doing this bill last year, health care was the number one issue on the agenda. there were other important issues on the agenda. whether or not to send the troops to afghanistan. when we come back from recess, the number one issue before the u.s. congress will be this bill in the united states senate. senate dodd's leadership and i know i look at the bill that he, himself did. i know what he wants to do. obviously, there will be some opposition and a lot of people lobbying against it and some of the republicans are promising the financial community they'll kill this thing. i believe we will get a very good bill out of here, especially, i think this is important, this is now the number one issue that the american public is going to be focusing on and in every single issue in contention i think we benefit from that. >> senator dodd, do you expect to get this will passed on memorial day? >> the leader said he'd like to do that and i am always careful about setting target dates and my hope would be before that, if possible.

let me underscore what barney said. i had positive initiative conversations with richard shelby over the last 24, 48 hours. bob corker has been willing to work on these matters and others. i know the republicans i serve in the senate that frankly don't want a just say no policy when it comes to major initiatives and they would like to be part of this debate and offer constructive ideas to this proposal. i am much more optimistic. health care, frankly, the outcome has strengthened our hand in reaching out to people who would like to be part of a solution. >> are there republicans outside of your committee? >> i haven't done that yet. sticking with the last two days with health care and the like and i'm interested in hearing what other republicans and democrats have to suggest and offer and become part of this effort so we can have a strong bill. what i'm determined to do is get a strong bill. exactly what barney said. we're going to end too big to fail and we'll have systemic

risk and deal with exhaustic instruments and have a strong consumer protection agency bureau, however that works out. these are all going to be part of that bill the president will have on his desk for a signature and we welcome the participation of those who want to be a part of crafting that. that door has been open in the past and still is. >> a year ago there was a lot of skepticism that we'll be able to do anything, when the first notion of the consumer agency came up, some of you wrote premature obituaries about it. i understand at the time it was pessimistic and this has constantly been moving and we're not talking about now whether to deal with these things and whether to derivatives but how, how is still an important set of questions but very different from whether. now that the american public comes to bear on this and no longer an insider game y think the product gets better on every specific. >> what are going to be the major issues in conference? >> we haven't gotten there yet. there may not be any. >> what was the question? >> major issues in conference.

>> we don't know that yet, the bill hasn't passed. it's like, why don't you ask me what the weather is going to be like on memorial day? >> it's going to be a good day. >> the answer is, we know what some of the potential issues will be and the important ones and a lot of this is, look, a lot of this is how you do the systemic risk and these are important technical issues but not idelogicical issues and things that could be worked out. as to what the issues could be in conference, it depends on what is in the final bill. >> jpmorgan tax break towards the purchase, is that what congress had in mind when it passed tax breaks? does that make sense? >> you'll probably have to ask the tax committee. we don't have control over taxation and i -- >> regretfully, too, by the way. >> chris has been doing health care and financial reform. i have been only financial reform. i know more about obscure

financial things and less about everything else in the world than i used to. i don't even know what provision of the code that has to deal with it. >> senator dodd, do you feel you need to reach a deal with shelby to get -- or just pull all the democrats and -- >> let's not get ahead of ourselves here. again, i'm dealing now, we're out of committee. i'm dealing with 99 other senators and not just the 22 in the banking committee. and so there's a lot more people to work with and listen to on the subject matter and i welcome that and look forward to that. >> senator shelby and now today senator greg said the too big to fail is not adequately addressed and that appears to be emerging. >> well, any ideas they have to strengthen that. there it is. i think very little light between those of us who want to make sure that never happens again. so, i'm very interested in hearing any ideas that would make that prezumption is bankruptcy. if you end up in that situation,

anything we can do to strengthen that, i am open ears. >> let me just add, by the way, we have addressed that as i believe the senate bill does. one thing we've gotten criticized for from the financial community is an amendment that we adaumented that empowers the administration which comes from the constitution of new, secured creditors. even the secured creditors could be told they're going to get a hair cut. the reason for all this is you want to be the investors unnoticed and make them very nervous and make them do the thinking before they invest. for example, we have the 10% reduction possibility for secured creditors. all these things reinforce each other. >> what about the $50 billion fund of permanent bailout? >> we're dealing with those issues here. we think that protects taxpayers so they don't end up writing a check if you ever get to that situation. that's a matter we're open to discussion with. >> i want to stress again you're talking about a situation when

hank paulson said he had two choices to pay nobody or pay everybody. they tried paying nobody with lehman brothers and he and bernanke came and said the world is about to end and the aig, remember, the fed without any congressional input decided to pay everybody. one of the things that is not in discussion at all is we are giving them the power to pick and choose. that's a very important piece. so that you begin with that there will not be the kind of dilemma paulson said he faced. we begin by the assumption we'll pay only those debts that are necessary to present a totally spiraling downward and that is where the fund would be used and it's hardly a bailout. there will be no more aigs. if they have to use some of the money to pay off the debts of a failed institution, the shareholders are gone, everybody wiped out. a very different situation than the past. >> do you hold optimism about republicans on this particular issue versus health care because

in a sense the bailout started during the bush administration. >> well, i think barney said it well and, again, maybe i'm a minority of one on this view. i would hope after yesterday those republicans who i think reluctantly went along with the just say no are against everything are finally going to step up and say, that's over with. we didn't get elected to sit around and say no to everything. we want to be part of a solution. frankly, if the leadership tells us no on everything, we're going to walk. i'm more hopeful as a result of that yesterday. the principals have to be very strong in this bill, but i want people to bring good ideas to the table and if they have good ideas they'll strengthen this bill and i'll welcome it. >> i don't think we could take much comfort from the fact that every single thing that represents a bailout deals with george bush. there was a terrible day, january 21st, 2009, in which

everything went wrong in america. unemployment started and the war in afghanistan went bad and there was a terrible disease outbreak. mass amnesia took hold of my republican colleagues. so, the fact is even though these things are inheritances from them, no, what i hope will work is what senator dodd has said. the american people don't think the kind of 100% rejection of any reform whatsoever that you saw in the house republicans, i think the senate republicans are smarter than that. >> if they don't, if they don't adopt that wise path -- >> we're going to get a bill. >> it's bottled up in the senate somehow. would you rather see something not passed at all or something that is somewhat compromised? >> i answered the question before you were finished. >> who do you like better? your mother or your father? >> all right, there you have it. the two house senate banking

leaders. mr. barney frank and chris dodd and too big to fail. a big, big topic in banking reform. financial regulation will be the number one issue after the easter recess, according to the two leaders. and they're really tapping down the too big to fail bailout nation issue. still some loopholes, but i think they're making great progress. let's talk about this. we have john harwood from washington and chairman and executive director of the cambridge winner center and steven, chief economist. john harwood, i have to give them credit. i've been behind this thing and i think they're damping down too big to fail bailout nation and i think that is a terrific free market reform. how do you read it, my friend? >> larry, i think this is fundamentally different from health care in that this is going to happen with or without republican support, although they do need to get 60 votes in the senate. the question is, how do you get them? do you get a big compromise with richard shelby or other senior

republicans, mitch mcconnell and pass a bill with 70, 89 votes or do you pass it through? republicans will have to choose which one of those things will happen. as barney frank and chris dodd just alluded to, this is like trying to count on the new orleans levees to hold back katrina. this is popular with the public. it's not mixed like health care. >> you're right. >> bailout nation, john. the public hates bailout nation and they hate too big to fail. i want to add, i've interviewed senator judd gregg and senator shelby just in the last couple nights. both of them really wanted to make it as tight as possible to end too big to fail. so, consumer protection is still stand alone and the derivatives is still out there. but on too big to fail, i don't know, trish, i'm seeing progress. >> barney frank did say he's still willing to pay off the debts to complete total complete

meltden meltdown of the entire system. >> some debts. we don't know which one. >> is that an issue that is still a problem, roj? >> that is the quarter problem that makes it too difficult to solve. in order to stop fire from spreading to the entire world's market. that encourages debt markets to be lax between now and the next crisises. i must say, i am a cynic at heart, the cynic it takes is quite a good one. i'm quite encouraged and quite confident, actually, a number of republicans will peel off. >> steve, are you positive on this, as well? raj? steve? >> yes. >> steve, are you positive on this, as well? >> resolution authority is something that has to be done. in addition to resolution authority you have to get down to basic capital requirements, as well.

make sure regulators use their positions to make sure that we don't create securities and all sorts of special purpose vehicles that circulate being implemented and that is one of the key issues. the better and the tighter the capital retirement rules the less need there will ever be to dip into that so-called fund and the more attention people will pay attention that these guys are serious about too big to fail and that would add more teeth to it. i would like to see more in terms of capital requirements and -- >> i think you're going to get it on capital requirements, steve. john, i want to go to you because i heard barney frank say something important. he said, look, bankruptcy court process and he said if some secured creditors lose, than so be it. that's a real break through, john. the idea that secured creditors, that means there's going to be pain. that means failure could equal failure and i see that as a real turning point in this discussion. >> frank plus kudlow equals a

bill going to pass. >> i'm telling you. >> that's what i'm telling you. >> i have been behind this thing from day one. when sheila bear attacked the back door bank accounts and dodd responded to cnbc right that afternoon saying he would close the language, i thought that was terrific. i'm listening to shelby and gregg and terrific three-market reform. believe it. anyway, we must move on. >> thanks for joining us, everyone. bank of america wanting a new loan move modification program. lawmakers holding hearings to decide what to do about china's currency policy. we'll tell you if forcing china could trigger a trade war.

welcome back. bank of america is taking a bold step to stop the bleeding on underwater loan and writing down principal is the first step instead of a final result. diana olick joins us from washington with more. >> bfa is confirming they will target subprime option arms where the loan is worth more than the value of the home for this program. no 30-year fixed involved. part of the new settlement with the state of massachusetts that b of a will apply. the loans must also meet the criteria for the government's home modification program.

now, the loans must have a principal balance of at least 120% of the value of the home and borrowers must be 60 plus days delinquent and it requires borrowers to earn the principal forgiveness over five years up to a maximum 30% decrease in the current balance. president of b of a home loans assures that same time earned principal forgiveness helps homeowners, it also recognizes and addresses the interests of mortgage investors by insuring that forgiveness is tied to the homeowners performance. b of a has over a million delinquent loans on its books but this program will affect very few, only 45,000 for a total of $3 billion in reduced principal. now, the government's modification program does not require prince. reduction and some say that's why it hasn't been so successful. i just got off the phone with howard glazer who says, "i think we'll see the government adopt a program like this and provide more incentives to get the banks

onboa onboard." we'll see. we will also have an exclusive interview with b of a president later on "street signs." >> thanks very much, diana. we're counting down to a critical five-year no treasury auction. the ten-year yield hitting a one-month high today. i don't see the quote, whether it got above 370 or not. there it is, 3.76. it has sold off quite a bit. steve liesman joins us live from the trading floor at jeffries and company and he has a special guest. hello, steve. >> hey, larry, thanks very much. we're here at the jeffries trading floor and we'll bring you live coverage of the five-year auction and you are correct, larry. treasuries are on the move and special guest with us, chief financial economist for jeffries. thanks for joining us. why are treasuries moving the way they are today? >> i think there are a variety of reasons for that. first of all, a lot of supply this week. the market is trying to cheapen up the issues in advance of the supply and we also have a lot of

corporate issuance coming into the market, as well. probably some hedging associated with that. >> walk viewers through how you review the results of an auction. a little cheat sheet say the five critical categories you look at to gauge the auction. >> i would narrow it down to two. what you're trying to do is get a handle on how aggressively the bidding is in the auction and also how deep the interest is in the auction. so, you can get a sense of how aggressive the bidding is by looking at something called the market tail and that is where the auction stops relative to where the issue was trading at 1:00. so, if the auction stops below the 1:00 p.m. bid, that typically means that you have a fairly aggressive bid in the action if it stops above the 1:00 p.m. bid, it means a little sloppier. also you want to look at the cover ratio, which gives you some indication. >> give us two numbers you're looking for. what is a till that you would be happy with and one saying the

government has a trouble replacing this enormous amount of debt. >> they're financing their debt cheaply. dealers on the other hand would like to see more of a tail because that gives them a little bit of a leeway where they buy the issue. >> let's talk about corperates versus treasuries. a lot of talk in the markets. how is it corporate triple a trading down near the united states and is there concern on this trading floor that the united states is not the greatest risk any more? >> well, there is a lot of concern of what is happening on the fiscal basis. we have enormous budget deficits and congress and the administration really have done nothing to address that. in fact, the recent legislation on health care is going to increase a budget deficits by over $1 trillion. >> is the u.s. still triple a. >> the u.s. is still triple a, but we're pushing the envelope a lot farther than i would like to see. >> i think there is somebody back there that likes what you said. >> steve, i want to just ask you and ward, in terms of the selloff and the tenure today, i

think that's ten basis points or so, do you guys think it had anything to do, really, almost a blowout number on durable goods. that was a very strong number. business cap x looks strong and inventories look strong. did that contribute to the selloff in the ten year? >> larry wants to know did the ten year sell-off today in results of the good durable goods number? >> they continue to point to strong manufacturing activity and a recovery that i think is sustainable. >> is the recovery underrated by the market right now? how strong do you think the recovery is going to be? >> i think the recovery is going to be a middle recovery, frankly. i don't think we're going to have a double dip and it's very clear at this point we do not have a v. we will have a sustainable recovery, but it will take time before we have strong growth. >> larry, back to you. >> thank you. coming up, getting tough on china. what's at stake for trade relations if the u.s. cracks down on china's foreign exchange

policy. but, first, an exclusive interview with at&t mobility president ceo ralph de la vega. you get it all right here on cnbc. boss:hey, glad i caught you. i was on my way to present ideas

about all the discounts we're offering. i've got some catchphrases that'll make these savings even more memorable. gecko: all right... gecko: good driver discounts. now that's the stuff...? boss: how 'bout this? gecko: ...they're the bee's knees? boss: or this? gecko: sir, how 'bout just "fifteen minutes could save you fifteen percent or more on car insurance." boss: ha, yeah, good luck with that catching on! anncr: geico. fifteen minutes could save you fifteen percent or more on car insurance.

lennar is reporting a narrower loss as they managed to trim some costs. the housing market is stabilizing and is seeing some improved traffic. of course, the economic data over the last couple days has not necessarily suggested that. nonetheless, lennar shares are at a 52-week high today. >> existing home sales down yesterday and new home sales down, again. >> third straight month yesterday. >> i hope there's a bottom in housing. i don't think that's a done deal the bottom in housing. anyway, let us move on. the international ctia wireless 2010 show under way in las vegas. the biggest players in the mobile market showing off their newest and best cnbc is the official broadcaster there and our senior correspondent scott

cone joins us with the ceo of at&t wireless in a cnbc exclusive. hello, scott. >> hi, larry. that man is ralph de la vega who is the chairman of the cti group, we are happy to have you with us. you come into the industry, the industry trade group in a particularly pivotal year. a lot is going on, isn't it? >> a terrific year and not only the growth is in wireless devices but emerging devices. devices that traditionally have not needed wireless conductivity but are needing it now. i have a couple here i want to show you. this is a tablet that is wirelessly connected which has security monitoring and here you have a pill bottle that is wirelessly enable that when you open it it sends the signal that you have taken the pill for the day. these devices are going to go by 10x over the next ten years.

>> therein lies the challenge and that is meeting all this demand for wireless conductivity. you talked about that in your keynote. you have a new plan that the fcc is trying to unveil but a lot needs to be dub to make all this stuff work. >> we are in the middle of a wireless data revolution. that demand for wireless mobile broadband is unsationable by the consumers and what is driving this is the networks that we have built, the smort phones that are available and the applications. the good thing is the u.s. is the world leader in each of the three categories so we're seeing this huge growth in demand here in the u.s. first. now, the great thing is that the things that we need to do to address that are to provide more spectrum, use technologies that are more efficient, to have the capability to use complimentary technologies and to make them more efficient. we're under way with the fcc broadbound plan that will dedicate another 500 megahearrt

in this country. >> the ceo of at&t mobility and people knew i was interviewing and they all wanted me to ask you about the service. the issues with at&t service. where are you on that? >> pc world last month tested our network throughout the entire country and we have the fastest 3g network in the country and, so, we feel like we've made great progress. we're continuing to work in new york and san francisco, but we're very, very sure that the network is running the best it's ever run. >> real quickly. the iphone. how long will that stay exclusive to at&t? >> we dent comment on that, but we're very happy with the iphone relationship and the iphone and the applications that we're seeing on those networks that is driving the great demand that we're seeing from consumers. >> the chairman that is putting on a great show and more on "power lunch" from here next hour. >> we were just going to talk

about that, scott, thank you. the cto of verizon wireless and the president of the sprint company will all join today's c wild. we'll debate who it hurts and who it helps. it's all coming up. are a demanding bunch. in fact, they want it all. you know, when i place an order, don't just fill it. get me the best available price. a better price means more money in my pocket. that's why td ameritrade's proprietary order routing technology

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okay, welcome back to "the call," everyone. 1168 is the level right there. quite a bit of news out today, actually. you've got some data on the housing market that is weighing on things with home sales falling for the fourth consecutive months and the dow off 45 points right now and the loss of 0.64%. portugal having a big effect on the dollar. nasdaq down 15 points. we want to show you something very interesting here. the dollar, of course, moving there against the euro. it's now 1.33 that's going to

buy you in dollars. it's going to buy you a euro. we're seeing action on that front. lawmakers are holding hearings on this hour on policy. with the very latest on this one, hampton. >> hi, trish. for lawmakers make no mistake about it china's currency which some experts say 40% undervalued is simply the hot button issue. for the past 90 minutes lawmakers in the house ways and means committee have been hearing from currency experts saying there is absolutely no doubt china is a currency manipulator and it is affecting the economy and jobs here in the u.s. one of the witnesses at the peterson institute is telling lawmakers if china's currency was revalued, it could equal $150 billion a year in deficit reduction. and that also translates, he says, into 6,000 jobs for every

dollar of every billion dollars in exports. >> revaluation of the chinese and otheration currencies are the most cost-effective step that could now be taken to reduce unemployment in the united states. it certainly would be the most important part of the president's national export initiative. >> but lawmakers are also being warned there could be a strong backlash from chinese officials who have taken a more aggressive stance lately when confronted with criticism from the west of their trade in economic policies. >> the chinese authorities are spoiling for a fight. and the united states congress must be very, very careful about giving it to them. we should be careful that the market reaction to a trade war or currency war between the united states and china does not exceed in its negative effects the benefits, which i believe would be minimal, of revaluation. >> now, at this hearing there's

unimty that a minimal first step is in the middle of next month when treasury issues its latest currency report. china should be declared a currency manipulator. then the strategy seems to be as far as okay, what do we do? take the case to world forms like the imf and the world bank and not make this a simply u.s. versus china, but china versus the world, especially emerging economies on this whole currency revaluation issue. larry? >> hampton, you have it right, but you're much too sensible, you could never be a member of congress, it just wouldn't work. thank you very much. >> you got it. the question now is getting tough on china going to force a trade war? let's go to andy bush and cnbc contributor and jeff papp, china's opportunity fund atober wise asset. the biggest moving market event right now is the rally in the

dollar against the euro. the o euro is down to 1.33. is the euro going to 1.25? what does it mean for our market? it's not our action, it's their weakness. how do you read it, my friend? >> it's the pigs all over again. obviously, this has spread from greece to portugal. it is worse for portugal. so, i think also there's a lot of indecision on who will actually help out greece and, therefore, who will help out portugal. that's certainly weighing on the euro and uk, as well. getting back to china. i was just in washington the last two days and this is clearly, as hampton said, a hot button issue. but it's really ironic that they have four guys testifying in front of the house ways and means committee and the essential tax body for the united states congress and no one of those guys is a tax policy expert. the easiest thing for dwloouthed

states to do is lower corporate taxes and put them on the level playing field as the chinese. right now the chinese have a 25% tax rate for corperates and the tax incentives the chinese have, it's about 12%. that's where the united states needs to go. one more thing, there's a bill out through the senate or that's being worked on. that would come out with a 24% corporate flack tax that i think is a step in the right direction. >> you know, i definitely want to talk about china, but i do want to bring you back to this portugal issue, again, andy. it's moving the markets today. now off 47 points. what is your take on potentially who could be next here? very good point you made that in some ways greece is actually in a better position than portugal because they haven't been downgraded and we saw this, to a certain extent, coming. the whole focus has been on greece. if you're to see who is really underneath the radar there in terms of who is in jeopardy, who might it be? >> i don't think anybody is under the radar screen any more.

you have understand the process. anyone who own os that debt has to sell it and then, of course, they have to sell the currency, as well. so, you see a pretty rapid move from action of a downgrade to the currency action and bond action. so, obviously, spain at 20% unemployment approximately, they have very serious problems and that was underscored by the fitch commentary on portugal. it's the ability to pay the debt is really the problem and i think that's why it continues to cascade and be a dominant thing. >> greece will also see a downgrade? >> i don't know if it's -- could it increase any more? >> they're in bad shape. >> i have to get jeff papp, thank you for being so patient, jeff. my old and dear friend fred burke steen, i love him, he said the same thing for 35 years. a cheap dollar will solve all our manufacturing and unemployment problems and reports from the kato institute suggest that when the chinese

currency went up 20% in the mid-2000s, nothing happened. the deficit didn't change and exports didn't change and imports didn't change. are we going to start a trade war for an unproven currency theory? >> i really don't see that being in other side's best interest. right now china is still very conscious and how their experts are going to fair especially during 2008 when the european consumer really fell off the map. if you look longer term, there will be some benefit when they do appreciate and this will allow u.s. and european goods and goods across the country to become much more cheaper in china. wages are increasing, standards of living are increasing, as well. this will be in the consumption from the average chinese people will increase, as well. this will move them up where they're demanding higher end services. this will come from places outside of china, like places like the u.s.

>> you could have an appreciation as long as you had convertibility that went along with it. these capital flows may drown the whole thing out. the nano second those guys start speculating on the rem nimby capital flows will go to china. it is also very inflationary for china to have all that money flowing in. these are the riskz here. we're playing with fire. the financial flows are far greater than the trade flows, jeff. >> i think that's a very good point. i think that's something that the chinese are very worried about and i think that is one way we could stem that or the chinese could stem that if they allow the chinese to appreciate. >> no trade barriers and one off appreciation and maybe we could have some conversion from china. >> would china ever go along with that, andy? >> a one-time deal so we don't upset the entire bloody financial trading system as the world is trying to recover. >> well, i would but it one step

further. i would go for a gradual appreciation so if doesn't shock the chinese corporation. >> no, it would be drowned out. >> it keeps going and going. larry, it's not the answer. the chinese currency is a small component of the trade and balance, if that's what we're trying to fix. certainly if we're trying to fix jobs in this country, it's really a small component of it. the best thing to do is to change the tax structure and keep u.s. corporations domiciled here and also profitable here and that way they keep jobs here and that's what schumer and graham really want. that's what they want to think about. >> i agree with the tax piece, i agree with the tax piece. the other thing, your are playing with fire. you're playing with fire. sorry, fire. >> we have to leave it there. all right, when we come back, one sector of the solar energy market is heating up. we'll tell you about the companies that are cashing in. but, first, the battle over bank tax breaks, are they good for the economy or just a rip off for taxpayers? we'll debate that in the call of

the wild. jpmorgan getting lots of cash from you.

okay, welcome back, everyone. jm smucker, that's what you're looking at says it's cutting 15%

of its workforce over the next three years. the move expected to save 60 million bucks a year once it's fully in place. you can see the stock trending up just slightly. 61.04 a share there, larry. a tax form could benefit some finance companies. today's wall street journal saying that jpmorgan is close to a deal that could land them a $1.4 billion tax refund at companies like usair and hspc are also getting breaks. on today's call of the wild, is this good for business in the economy or simply another taxpayer ripoff? let's go to bill and rob cox, managing director for business insider. there's john carney and phil kurpen. i'm glad to see john because i'm going to you, john. this is a ripoff. let's go to a flatter tax rate regime and stop rewarding

lobbyists that rips off the taxpayers? >> that's exactly right. right now zee a system where he with the best lobbyists win. that's not the way our market system is supposed to operate. we are not supposed to reward companies that failed the most with the biggest tax breaks. why not say, instead, we'll lower the taxes of corporate america. taxes are too high in corporate america and that's why they're out there lobbying for these special breaks and let's get rid of the special breaks and have a more competitive tax system. >> john, you're so sensible, though. phil, what about the lobbyists collecting a pay check every week? how would you get them to go along with this? >> i would much rather see a supply side tax cut than demand side tax cut. so, i'm with larry on that. however, i do think that there is some logic here from a fairness perspective. they paid tax on a lot of profits that weren't real profits and they ended up being alusory when the market crashed. you would give them the opportunity to expand the

carryover and get back the tax money profits that weren't real profts and this provides liquidity to a lot of industries that could use it right now. frankly, if they pass a law like this, there is nothing wrong with these banks taking advantage of it applying the law and that's all we're seeing. >> homebuilders, airlines. there's no end to this. this is just, this isn't good tax policy. this isn't economic growth in jobs. this is whose k street lobbyist has a bigger -- >> let me explain what is really perverse. we said we should have a claw back of some of their components, that that makes sense. they created profts and made a lot of money for themselves during the boom years and now they want to claw back the, after the blow up? that's really perverse. >> from a shareholder perspective, you should have both. we are seeing crackdowns on pay

with everything feinberg is doing. i don't think it's unreasonable to say the tax man's elusory profit should also be returned. again not my favorite tax cut. but, i don't think you can say that this is unfair. i think there is a logic to it that makes some sense and i think if they put this into law, which they did, you don't turn around and start bashing companies for taking advantage of it. >> isn't it to a certain extent this unfair. it all depends who is lobbying for you? >> where is my net loss? where is my net loss carried forward. where's mine? i lost money, a lot of investors lost money. john carney, will you help teach phil, teach phil why we should abolish every single loophole and tax credit. abolish all of them. take the corruption out of the system. still need tutoring right here on this show. >> what we need to do is stop rewarding companies and really

stop incentvising them. it's not their fault that they're taking advantage of this or that they are lobbying for more loopholes because as long as you have a system that rewards people for hiring lobbyists, guess what, we'll have more lobbyists and more loopholes. >> but, meanwhile, we live in the world we live in, larry. >> let's have unlimited capital loss carry forward for individual taxpayers so we can deduct all of our kaccapital la. they're about to hike it 3.38% and everything is going in the wrong direction right now. i'm with you, the capital gains tax should be at zero. i'm not about to beat up companies for taking advantage of a demand side tax cut that was put in there. i mean, that's, you know -- >> we need to encourage companies. >> we need to encourage companies by beating them up where they take advantage of this to instead lobby for flatter taxes, lower taxes.

>> this is the k street demand side, no growth, no job creation, selfish tax credit. that's all it is. >> it's a terrible thing for the economy. >> we got to get out of here. >> by the way, john carney is with businessinsider.com. we didn't get it appropriate. >> good to see you guys. "power lunch" at the top of the hour and michelle curusa cabrera is at the convention right there in las vegas. hey, michelle. >> larry and trish, it is going to be an exciting show. this is incredible. the demonstrations here. what we're going to see. we have got one of the new droid phones. the galaxy s from samsung. it's all about, larry, the peril and promise of mobile broadboan. when i hit that link on my blackberry will i get to that link and that spot and that internet spot? that is the talk here. which companies will do the

rollout and how can you invest on them? all that coming up on "power lunch." >> all right, michelle, you look really sipsyched. >> my wife won't let me have a blackberry because i will be addicted to it. companies cashing on a red hot slice of the market. >> they are getting one thing through. the market call heading into this afternoon's trading session. we'll be right back.

okay, welcome back. some consumers are looking to save some green and so they're going green when it comes to their hot water bills. more and more homeowners are discovering that the cost savings of solar water heating systems are really worth it. wendy is here to explain what with the main street business report. >> hi, how are you? >> good. >> put these on in my house and offset two-thirds of your hot water bill is couple panels on the roof, hot water tank in there and the heat collects on the roof and circulates down to the tank and that's basically all it is. it's the solar nobody talks about. everybody talks about it for electricity. this will cut you out of two-thirds of your hot water

bill. systems run $2,000 to $10,000. hot water heating is your third largest energy expense in the house, most people don't know that. very lucrative tax rebates out there. federal tax credit of 30% unlimited for this system. i see larry frowning. small businesses are benefitting from this because it is putting a lot of the guys and the women in the construction trade back to work. you're seeing electricians, plumbers out in california. you're seeing smart systems usa in new york. these guys are really benefitting for fromtop. >> if you can't beat them, join them. >> i'm all for it, but i don't like the tax credits and industrial -- >> these are bipartisan tax credits. bush and the obama administration -- >> that doesn't make them any good. i love the solar story and i think your analysis is correct. why do we have to, just lower tax rates for everybody and then we can afford solar and everything.

>> i don't come cheap. >> thank you. we'll take a quick break and then be back with this morning's market action. and the list of stocks to watches as we head into afternoon trading.

all right. now it is time for call to action. stocks you need to watch during afternoon trading. cnbc matt nesto is here with a quick look. >> the best thing i can tell you is higher lows today. so far we took one test and held at a bounce back. if you look at the problem areas in the market, i show 20 of 24 industry groups are down. transports, retailers, household products and semis among the worst in the marketplace. the standout continues to be the financial sector and within that bank of america, jpmorgan and citigroutr