manhattan rents are doing better and real estate properties looking better in manhattan. brookfield, those are new highs for those stocks, as well, that had nice surges just in the last two days. how about the bank stocks. we had some positive comments here. wells fargo talked about big cap banks and the better situation that we've seen for them and we'll talk more about that in the next hour but all these stocks big movers and so far the bank index up 25% this year, way out performing most of the other sectors. tradertalk.cnbc.com. bertha, how are we looking at the nasdaq? >> positive territory and have stalled out. we got ca after warning it is going to be cutting and restructuring and taking 50 million charges coming off the low and still the biggest drag on the nasdaq. vo vodfone not far behind and not sure when things will be resolved over the verizon merger. apple goes ahead and puts in a

new 52-week high moving off the lows this morning. he would like to see the iphone on the rur sizen network. take a look at some of its rivals this morning. they have really been what's holding things up here in terms of big cap tech. research in motion strong today and amazon strong today and the networking gear makers are strong after at&t says it will extend its networking effort by $1 billion. move on to sharon now over at the imax. >> we're waiting for data to come out from the energy department and monthly short-term outlook should be momentarily. a month ago they expected oil prices to be above $80 a barrel this spring, $82 a barrel on average by the end of the year. we topped $89 earlier today. right now we are looking at oil leading the market and the refined fuels aren't following suit. lower prices for gasoline futers and for heating oil at the

moment, although heating oil leading this market higher and it's up 8% and had been leading the gains in the oil complex. natural gas got that spike yesterday that shows they'll have a change in their methodology and today we're looking at slightly lower prices for natural gas, as well. rick santelli to you in chicago. >> thank you, sharon. you know, everybody has been talking about the run up in rates and with good reason. however, slow down a bit. looking at a two-year chart of ten-day rates. what happened yesterday when we dabbled above 4% -- not a lot. five basis points isn't huge, but here we sit in the mid-390s which underscores that even with the conventional wisdom maybe proving correct rates will go higher and still not doing it in a heated fashion. if you look at the doctor index is what is incredible it is doing better and that's dynamic to pay attention to and look at

the ten-year in greece. the common topic of conversation on the 28th of january over 7% and over 7% today and the spread between that and the boons which are a flight to safety issue is over 4%. and that flight to safety probably helps our three-year note auction today at 3:00 eastern. >> which we'll have you back on to talk more about, thank you so much. speaking of the bond market, one of the legends of the investing world says now is the time to buy stocks and stay away from bonds. here's leon cooperman who was on earlier. >> buying bond funds and not putting money in the equity market. to me, that is not what you see at a cyclical peak in equities. i think bonds are not a good place to be. >> let's gather our power lunch market insiders. jeff philips and todd coleman, vice president at mf global. todd, what do you think? do you agree with leon cooperman

that now is the time to buy stocks and not bonds? >> i wouldn't be, i'd be hesitant to sell my bonds on the lows. i'll tell you why. the risks continually being repriced when you look over in europe and asia and bonds are still going to be the quality, quality investment of the globe and i think that, yes, we have seen bond yields rise and it's a signal that things are going to change here, but not overnight and i think we have another six months before we really see the economy back on its feet and that's when you probably want to start looking to get out of these bonds. >> jeff, what do you say to people? a lot of folks still feel very burned by the stock market crash they went through and feel a lot of safety in bonds. is that misplaced? >> i don't think that's necessarily misplaced. i have to agree with his comments that the interest rates will likely rise, but not overnight. it's going to be something six, 12 months down the line. so, going short term on your bond funds and in your individual bond holdings i think is still appropriate and safe place to go.

i think we'll continue to see safety there. >> hey, todd, i'm sorry for this simple question but when you talk about bonds and whether we should put money into them, are you talking about if i should lock up ten years or just trading in and out of bonds every day? what is your -- >> i tell you, dennis. what it is we're looking at, we're looking at a short term, probably two to three-year window here if you're saving for college or buying a house or something it's a little different. but for the individual investors right now you're looking at a three to five-year area and right now corporate bonds. i know we're talking to treasuries but corporate bonds suggesting you would rather lend your money to ibm than you would to uncle sam with the idea that you'll get paid back. >> jeff, a simple question. if you lock up $10,000 for the next ten years would you put in it reshries or the s&p 500? >> i would certainly put it into both locations. i think you're going to see sideways movement in the s&p 500

for a little here. the treasury still at 4% is overpriced for what i expect to occur in interest rates. we'll know more this afternoon when the open market committee minutes come out to see if we should stay shorter for the three to five-year range for fixed income. >> what are the factors you're looking at that this recovery can be sustained? >> the job's market is one but what we didn't see in the job's market last week is that average hourly earnings declined. the deflationary markets we're seeing home prices, whatever. that needs to turn around. we need to get these things back, reinflated and, obviously, the rates are not going to higher on the short end until we see that happen. >> guys, good to see you, thank you. mine safety revisited. why has seemingly nothing been done to make it safer? plus -- >> iowa senator chuck grasly calling obama's bill america

bonds nothing but a bailout for new york and california. is he right or just fanning the flames of fire that doesn't exist? cyberbullying. companies that provide a form for potential bashing libel when things go wrong? the president of ea sports talks about the timing of its new tiger woods game out today.

the governor of west virginia now giving a press conference on the worst u.s. mine disaster in more than 20 years. in the town of montcoal, west virginia, at least 25 miners dead now in an explosion and four others are still missing. this mine is owned by massey energy which has had its share of osafety violations in recent years. hampton pearson has more now. >> hello, tyler. massey energy safety record will be scrutinized why the exact cause of this tragedy goes on. last year inspectors found more than 450 violations and fined massey in excess of $382,000 related to problems involving its ventilation equipment plan at the upper big branch mine where this latest tragedy has, in fact, occurred. the second time in four years coal miners has died. the death of two miners in 2006 triggered a then record $1.5

million fine from federal mine safety regulators. in the last three years massey the largest coal minor has been cited for multiple violations. a union mine safety expert says there's a reason those mines and others stay open. >> operators have learned that they can beat the system by doing this. to avoid hot dollar tickets and stay off the pattern of violations and keep their mind open and continue to do business as usual. >> now, meanwhile, four years ago the sago mining disaster when 12 miners died in a methane explosion less than one in ten of the nation's mines are in compliance with a congression lt mandate to equip mines with high-tech communications and tracking gear. estimated cost about $278 million industrywide. government regulators are now taking coal companies to court to speed up that compliance. dennis? >> all right, hampton, stay with us. let's bring in ellen smith who

is the publisher of mine safety and health news. thanks for being with us. ellen, my first question, mining is a dirty, dangerous business. when we see a tragedy like this, is it automatically true that regulators messed up and the company messed up or are some of these accidents just kind of unpreventable? >> look, in this case something went terribly wrong and we have no idea what happened and the one lesson that we learned from sago in 2006 was the sago mine had over 700 violations in one year, but those violations did not contribute to the fact that a lightning strike is what caused that mine to explode. we have no idea what has caused the explosion in this case. you know, we'll look at it. does this mine have a lot of violations? yes. does it have a lot of unwarrantable failure violations and elevated enforcement level actions from emsha? yes. but the bottom line is we don't know at this point what caused

this explosion. >> but when you look at these numbers, 450 violations last year. the numbers are stunning and you just have to wonder. you didn't really answer dennisedennis dennis' question, are the watchdogs failing to do their job? >> they were there on april 1st. they were doing a mine inspection. we looked at the record. they have been there for numerous spot inspections. obviously, this was on the government's radar screen and i'm certainly not going to make an excuse. >> let me jump in and get you to address the issue that was raised in hampton's report, the mining union. and that is his assertion that the big companies, like massey, are able to keep operating even in the face of multiple and in some cases hundreds of allegations of misconduct on the part of the government by drawing out the process. in other words, they'll be hit with a fine for whatever it is,

$800,000 and they'll appeal it until they're blue in the face and nothing happens. so, it's less a problem of the regulator who is going in and causing the citation, but the process that draws it out. what do you say to that? is that what's going on? >> no, that's not completely right. they issue a citation and the mining company still has to correct the violation. they can challenge whether or not there a violation, but, in fact, they have to correct the situation that they were cited for. >> so what was dennis' point in that prior interview then? >> what dennis is saying is that for a mine to get on what we call a pattern of violation noticeses, one of the things taken into consideration are final decisions of the federal mine safety and health review commission. the bottom line is, the review commission is backed up. they have 16,000 cases before them. they don't have enough judges and they don't have enough money and there is a wait.

there is no doubt, but the other side of that is when they cite a company, it still has to correct the violation. >> ellen, a lot of criticism in n n nitsa between a revolving door and people who worked in the industry, is there a similar situation in the mining industry? >> you know, the resolving door comes at the top. i mean, the president of the united states can put whomever he wants to head emsha. they know the mining industry in and out. do they know the mine operators? yes. do i know the mine operators? yes. >> is there a chance of regulatory capture here? >> you know, i don't think so. you have joe main heading, formform er head of health and safety. you certainly can't say that

he's not on the side of miners. >> got it. >> thanks very much for being with us. >> thank you. up next, guys, dynamic funds. one of canada's major players. $35 million under management and gold and precious metals a big focus for them. we'll ask a top manager if they have a room to run. next hour we go off the chart with a blue chip stock up more than 100% in the last year. power lunch is back in two minutes.

gold catching some good air today but the question is, where do we know from here? insight from robert cohen manager of the dynamic manager to the best performing metals fund in the u.s., up 7.3% in the past year. welcome to "power lunch." >> thank you. >> why invest in gold now? >> well, we still think gold is moving up due mostly to monetary reflation. we've seen, obviously, a large amount of expansion of the u.s. monetary base to fight off a recession in late 2008, but,

also, we see ongoing budget deficits for many years. we just see the need to print more currency, mostly in the developed countries because as the population ages and there's low birth rates, you have a larger and larger debt burden and burden of health care costs on a smaller and smaller working class portion of the population. >> but gold has had such a run over the past year, do you think it still has that much left to go? has it had its run? >> gold has been running since 2001 on the back of the monetary reflation argument. we have been bullish on mostly on the arguments of the medium and long-term arguments for many years. what came along in 2008 was the global economic recession, which was very tied to the fact that global foreign exchange reserves built up to $7 trillion. over $2 trillion is in china alone. so, we've had a lot of trade with the far east, with

particularly with china and, of course, there was a massive devaluation between 1986 and 1994, which i'll -- >> tell me why i'm buying gold here? it's because the economy is heading for a crater and, therefore, i'll need gold because gold goes up or because the economy is healthy and inflation is going to kick up and then i need gold to hedge against inflation. >> well, it's a hedge against inflation. we're not in a true inflationary environment right now. to do with high capacity utilization and low unemployment rates and wage pressures. we are seeing monetary right now. i'd like to set it aside from the commodity because it's a true monetary asset. it's an exchange for thousands of years. so, it is, you know, its

function as a monetary asset is the driver of the gold price. if you look at the gold price changes in terms of oglobal liquidity in terms of the u.s. monetary base plus changes in global foreign reserves there is a tight correlation in the one variable alone. >> now, the dollar is strengthening, we saw the stronger dollar did prompt some traders to take profits in gold futures. what is your take in terms of the strengthening dollar and the fact that you no longer need gold as much of a hedge against that dollar weakness. >> in the medium term we have seen some bouts of u.s. dollar strength due to, obviously, better employment numbers and so on and so forth but our longer term trend is still that there are massive bumgt deficits that are running for years and we also have a problem with global foreign exchange reserves that have build up around the world. gold is really a hedge against what central bankers do to us. >> if i buy your thesis of buying gold as a store of value,

what is, if i'm an individual investor, what is my smartest way to do it? should i buy the stocks of gold miners or bouillon or coins, what should i avoid? >> certainly the safest way to play gold and the most conservative way is to buy gold bullion and i don't mind whatever form an investor chooses. if they choose coins, i don't mind paper gold, i don't find that there is any risk in it, but others that do. so, depending on what you, your risk tolerance, that's fine. now, you can buy equities and the nice thing about equities, there's a leverage to the gold price because if you think of where the profit margins are of the companies they're typically right now around 15% profit margins. a $1 change in the gold price has, obsiously, more leverage effect on the profit margins of those companies. so, buying a diversified mutual fund like the one i manage is a great way to get exposure

because we go from the senior producers down to the exploration companies. >> thank you. >> thank you. the t.a.r.p. program took plenty of heat and now the government will take some money from it. mary thompson has all the numbers, coming up.

welcome back to "power lunch." . we're almost halfway through the trading day. ca cutting 1,000 jobs and greece launching a u.s. bond issue in the next month hoping to raise between 25 $5 billion and $$25 billion alcoa joining the parade of companies to the tune of $80 million. michelle? >> lots of fire, julia. directed at the t.a.r.p. program and mary thompson says it's turning out to be profitable for the feds. >> some of the profits easing the t.a.r.p. pain and two parts are proving positive. those aimed at financial firms. snl financial tallied up on firms that repaid t.a.r.p. and found the treasuries received an annual return on 8.5% on these

investments. over 400 banks and financial firms borrowed $244 billion through t.a.r.p.'s capital purchase program and the targeted investment program which was set for citi and bank of america. intended to strength on the financial system and bolster bank's balance sheets but it seems it's bolstering the treasuries, too. snl looked at 49 firms including morgan stanley and sachs that have paid $18 billion repaid in treasuries. netting $5.6 billion in profits from the sell of the company's warrants. even after factoring in t.a.r.p. money the company is up $10 billion and it is a number that could go higher. that's because snl didn't include 18 companies that have repaid t.a.r.p. but whose warrants have yet to sell firms like wells fargo was not included in this data. and did not take into account the sale of 7.7 billion shares

of citi which at today's price is at $7.7 billion. the anticipated gains to offset future losses on troubled smaller banks, 74 of which stopped paying dividends in february in the t.a.r.p. money they borrowed from the government. >> enough to offset the losses. >> not all of it. cbo estimating losses on t.a.r.p. in total the $700 billion about $106 billion. but in this particular area, what they lent to the banks, that is actually supposed to be a profitable part of top four. it doesn't include what it lent to aig and aid provided for homeowners and small businesses, as well. >> which parts of that investment were most profitable? >> within the 49 companies, i will pull out the big firms. the return on the investment in american express was 23% and goldman sachs 20%.

again, all on annualized basis and morgan stanley was 17%. >> can i get a second motion here as much as middle america and washington was so livid at the wall street banks, we bailed you out. the fact the banks in the end did not cost us taxpayer money. the banks returned at an 8% annual rate the money they were loaned under t.a.r.p. >> we're still paying for fannie and freddie and they're going to cost us far more. >> it would cost us more if we hadn't bailed out the banks. >> exactly. >> but who's to blame for us having to go in there to bail them out in the first place? that's where the anger comes from. >> yeah, sure. >> just because we make a profit on the investment. >> justified. >> no, because we're trying to avoid having to do this in the future. let's remember that. >> far less punitive actions against those taken back and never pay it back. aig automakers. >> aig. >> aig is only estimated to lose

the government $8 billion. according to the cbo, yeah. yeah. >> that's a big story,er too. >> mary thompson, thank you so much. coming up next, iowa senator chuck grassley says the build the bonds program is great for new york and california and not just not so hot for the rest of the country. >> the program is another taxpayer bailout for new york and california. is that the case or is this really more of middle america just hating on wall street? we have opinions on the other side of the break. tdd# 1-800-345-2550 every online equity trade is now $8.95 tdd# 1-800-345-2550 no matter your account balance, how often you trade tdd# 1-800-345-2550 or how many shares... tdd# 1-800-345-2550 you pay what they pay what everyone pays: $8.95. tdd# 1-800-345-2550 and you still get all the help tdd# 1-800-345-2550 t you expect from schwab tdd# 1-800-345-2550 millions of investors. one price. tdd# 1-800-345-2550 at charles schwab... tdd# 1-800-345-2550 investors rule. tdd# 1-800-345-2550 are you ready to rule? not that long ago, many families were priced out of an overheated housing market.

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there's a new twist in the effort to forge financial reform. aides to senator richard shelby, ranking member of the banking committee has proposed the idea of a consumer agency to chairman chris dodd's office last week. shelby had been opposed to such an agency, but the new proposal is said to include a counsel of regulators that could veet though agency in certain cases. certainly if he is favoring, there would seem to be a reversibrevers reversal by senator richard shelby. wall street firms earned the better part of a billion dollars in build america bonds in the past year. bonds will create jobs by funding infrastructure projects. the recent treasury report

states that the majority of the bond deals were done by just two states. senator chuck grassley, the ranking member of the financial committee and senate. calls it a taxpayer bailout and "instead of looking out just for california and new york and wall street banks, i'm looking out for the american taxpayers who are going to be stuck with the tab." joining us now a couple voices from the heartland john gallagher and lauren stefy, business columnist at "the houston chronicle." welcome to you both. without getting into the intricacies of the build america's bonds program which is an eye glazing exercise, if ever there was one. does it surprise either of you that two of the nation's most populous states, the largest states in the country, i ges with texas in there, as well, are the biggest issuers of these bonds? should we be surprised by that? jump all, go ahead. >> well, no, i don't think it's

surprising. i mean, these are the states that have a big chunk of the population and it's sort of understandable that they would be the ones to ramp up the in a infrastructure projects that these bonds are helping to finance. >> a highway in new york is going to be far bigger than some highway somewhere else in the country. the infrastructure for 10 million people is bigger than a state with a few million people. >> i don't think you'll see as much of a need for highway projects in iowa or things like that as you are in los angeles. >> john, is this really a case of justified or unjustified anger at the big states that have been profitable in spending like new york and california and the wall street banks that have profited from issuance of these bonds? john? >> yes. the sales commission on the bonds on wall street may be an issue. as far as california and new york, the selling most of them so far i don't think, i don't

think any anger is justified. i think a lot of michiganers would say why wouldn't our state have gotten off the dime quicker but if there is stimulus being handed out michiganers would say, where is ours? >> ours would have been in the auto business that would have been one counterpoint there, right? >> they understand that. with the highest unemployment rate in the country for the last several years and libraries closing and teachers being laid off. if you hand out stimulus, we're here. >> but isn't there, isn't it incumbent upon the state to go in and get those projects going and say, and lord knows there's an awful lot of infrastructure that could be rebuilt in detroit. >> sure. i'm a little surprised that california, new york have gotten off the dime faster than anybody else. that's what is a little surprising. they're bigger and, therefore, they have bigger projects, that's not surprising, really.

>> dennises, let me bait you into something there, my friend. i know you to be a populous and have that houston sensible when it comes to a dimmer view of wall street. be a little meaner about this for us, please. >> first of all, it's worth noting that texas has turned down stimulus money on a lot of fronts. i don't know that texans are angry about this particular issue -- >> you know why they could get angry? here's why they could get angry. >> this is not what we wanted in the first place. >> that said, the federal government has enabled all these states to spend even more. that's what's happened. the federal government has come in and given them a subsidy and now instead of people in the state buying a muni bond they're trying to convince -- it's just making it easier for them to borrow money. >> we're pushing off the state crisis. we're essentially dealing with the bailout of the state crisis that is the next phase of this

thing working through. we could be smug about that in texas. we haven't had to deal with this yet. but next year at this time we may be finding things pretty ugly down here, as well. >> easier to borrow, but cheaper according to most of the studies, right, john? >> this is part of the stimulus program and now there is talk they'll extend it with a lower subsidy. this is part of the stimulus program that was meant to pull the economy out of the great recession and if you leave it at that, i don't think it's quite a bad deal. >> seems like the obama administration is against cutting tax rates for any kind of big fat can investors and here they're in favor of cutting tax rates in essence for states that issued bonds. they allow them to pay an lower rate, artificially lower. >> they want to enable the states to spend more money. >> more tax money, right? >> exactly. >> i don't understand it. >> but, john, it sounds like you're implying that you don't

think michigan is doing its job by taking advantage of this. >> i think they certainly have been slower than california and new york. that's all i meant to say. they're trying to take advantage of the stimulus that they can. >> sorry to interrupt. i have to move on. still ahead, a big week for treasury auctions, speaking of borrowing money, kicks off in just a few minutes. three-year notes on the block and results and instant analysis. one of the most powerful businesswoman in asia. a luxury brand that is taking the world by storm. up next simon hobbs and the gang with a fast money halftime report. with fidelity, you can take your trading around the world, because now you can trade u.s. and foreign stocks online, in 12 markets, 24 hours a day, all from the same account, and settle in u.s. dollars or the local currency. plus, we'll guide you with international research and realtime quotes,

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oh, yeah, stocks cut their losses earlier as financials pull ahead after all this morning's fear over greece the market now focus turns to the three-year bond auction at the top of the hour and what could be revealed in this afternoon's release of the fed minutes. i'm simon hobbs in for melissa lee. the fast money halftime crew joe, eugene profit of profit investments and jj of tdameritrade. do you like the market as this level? >> i don't like it at all. but that being said, we're

finding an opportunity in computer services and finding some opportunity in health care and some other opportunities in telecom. all areas that areilatal controversial and you have big dividend yields to wait for the market to settle itself out a little bit. >> specifically verizon for you. >> i like verizon quite a bit. 6% dividend yield and you have a catalyst coming in that the 3g is going to be added to the iphone starting to be reported and we think that will be a catalyst for verizon going forward. >> j.j., do you like the market? >> i think the s&p has to trade and we're only 22 points away in the short term, yes. once we get up there the market will capitulate and i think we'll be a bit range bound here for the summer until the market finds a catalyst one way or the other. >> we come off our highs, but still looking very strong. >> it looks very strong and it's a fundamental story, simon. i think the trade right now, you

can look at the oil services today. raymond james and jpmorgan on the other side of that taking it down. my suggestion would be, if you're looking to drill down a little further and look at halliburton. much more of an international exposure and with oil, let's lee careful. you get stats coming out tonight and tomorrow morning. oil right now pulling back under 86.5. >> john, you made a very impassioned plea last night for ak steele, worth repeating. you're absolutely solid. >> i amp i like a number of other steel makers, as well. the reason, of course, the price of iron ore the main thing that goes into steel has gone up. the producers of oil and steel and iron ore, i think that's a wind at our backs here in the u.s. and that hurts most of the asian steelmakers.

it will be great for u.s. jobs overall. this is not job protectionism but increasing their price and doing so on a quarterly, rather than annualized basis. >> let me pick up specifically on some of those names. j.j., you have an insight as to what retail customers have been doing. >> yeah, we saw with our retail traders over the last week, you know, one name john did mention we talked about bhp, bhp is one where we saw a lot of oour customers selling over the last week and a week and a half and getting out of their long positions and going shorter and rio tinto not working out quite as well to a lesser extent. >> the headline for much of the morning was that technology was down partly because of ca with its job losses. but you've got some quite big moves on amazon, in particular today, eugene. what are you making on that? >> that's ipad related. you had late yesterday the app for the kindle came out and you have 450,000 books in amazon and

even though some people are concerned that the ipad might surplant the kindle at some point, i think you would rather sell more books than actual kindles. >> the reality with amazon is that the market last week was playing it from the short side. you had a little bit of a down trend, that's being unwound today and that's the reason for the correction. >> i agree, simon, with eugene and with joe. the sales of the kindle are not the big thing. of course, it's bringing people into the book store. ipad is going to do that. i believe that they will screen past the kindle. i think that seems to be a consensus that is building and amazon not wanting to get just run over by this trade is going to profit from it. that's why you see the money flowing back into amazon today. >> an astounding move that we had on greek bond yields today as on greek bond yield, they suggest they don't want imf as part of the package to help them out. they might have a little too

harsh. there you go. astounding news. higher than we were. lets bring in rick santelli from chicago. rick. >> reporter: a tremendous move. i'm glad we have that chart there so viewers can see above 7% january 28, above 7% today. ironically within a half a basis point of the same high. what's different is that the yield, the flight to safety piece of that puzzle moved down in yield and it was a little lower in yield than january, hence the difference between the two. this go-round was wider. simon, you're from europe. the real key here from the states, we look at it from afar, are we going to see -- >> do you want to come in on this. >> people are rewarded for putting money to work in a more desperate place, greece.

the risk premium should be over ten-year treasuries it is. i'm sure rick agrees there. i'm not surprised to see it having to be around 7%. >> rick, let me draw you, if i may to nine minutes away from results of the three-year auction. what should we watch out for. what are you expecting? >> i think this is an interesting auchbltion. i operate from the following premise. the wia very tight, 175 to 1.77. when you at what's going on in greece, even psychological short maturity will go well, make price 1.75, 1.77 yield. >> rick, thank you very much for that. let's move to more of today's trade. j.j., we mentioned european banks, commercial banks have seen a little action today, no? >> absolutely. we see, first of all, european banks, one of the trends has been in ireland, bank of

ireland, seen a lot of call buying going on there as well as stock buying. but if we talk about what's doing on at eus, we see things like wells fargo and citigroup and some of the american banks have also benefited today with people coming back here on financials. >> to pick up, the financials have really pulled us back to cut the early losses overall. >> yeah. that's somewhat surprising given the tax talk out of the imf, simon. just as joe says, we see block trading of options in wells fargo, citigroup and jpmorgan in particular today. those are big options bought in block by institutions, a bullish sign. >> are you a birg? >> i am. >> i'm owner of large banks, not an aggressive buyer. you have interest rates increasing, spreads beneficial near-term. i think large banks have had a large move. i'm willing to sit and wait. >> joe, would you wait. >> regional banks having a tremendous move today on the

realization that the commercial real estate market is not as bad as we thought. the next shoe to drop is more like a slipper. mortgage insurers have had a great move on what bank of america did and continued the upward momentum. >> it has to be said the article saying rents are going up, reits had a very good day as well. >> reits absolutely on fire, simon. just like with mortgage insurers, there's a lot that the administration has done that has just gone into effect yesterday that effects foreclosures and makes them not vacant as long on the residential side. i believe that is helping sentiment on the commercial side as well. >> j.j., do you want to have the last word on that? >> with what everyone is saying, i agree. one of the things i would add to that, everyone seems to be bullish on financials. eugene said at the beginning he doesn't want to sell them here, think of puts at wells fargo at a 29 level if you're afraid of a

pullback. >> gentlemen, stay with us. don't go anywhere. we'll tell you where big money is flowing in options and equities today. back in a moment. a street fight of the highest order. airline continue to soar but will crude curb these carriers, scan the skies to bring you the trades. plus, it's the moment you asked for, the real march madness, fast money madness winner is crowned and the hardest working man in the biz will reveal, reg. '6 in 12 markets, 24 hours a day, all from the same account, and settle in u.s. dollars or the local currency. plus, we'll guide you with international research and realtime quotes, so you can diversify your portfolio, wherever -- whenever. and we'll be on call around the clock,

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

that could increase fuel efficiency by up to 80%. welcome back to fast money halftime report. big money flowing into mbia with stock seeing over 70% of ten-day average volume in trading.

what's going on? >> we've seen incredible money flows on the option side, big chunky institutional buying on the offer. to us they believe there's an upside. that's been great for mortgage insurers, mbia moving with it. these are clearly outperforming the market now. >> joe, give me a trade to go? >> 5:00 p.m. tonight, simon, i don't know if you watched the game tonight but tonight march madness fast money who is the winner? regis is going to join us and tell us. >> let's call the close. around the horn. let me kick off with you j.j. >> i'd be a buyer, simon. >> okay. eugene. >> no surprise in the bond market. i think we go higher this afternoon. >> you're worried about the auction then? >> not quite. i think overall the market is going sideways but nasdaq tend to pull us higher. >> john. >> i believe we drift higher especially if rick is right

about 177 yield. >> joe. >> buy the nasdaq. >> thank you, boys. thank you very much. that's it for halftime report. be sure to catch "fast money" tonight at 5:00 when we reveal the winner of fast madness contest. stay with us on cnbc. >> thanks, simon. cyber bullying are internet companies liable when posts on their site take a horrible turn plus a whole lot more. a cnbc exclusive president jeffrey lacker sits down with steve liesman, pending financial regulation and the future of fed policy. asia's most popular handbags coming stateside. they have been seen on gossip girl, a sure sign it's a trend to watch. the ceo of south korea's mcm. ea sports goes into the woods releasing a brand-new tiger woods pga game today. will it be a hole in one on caught in the sand trap.

we'll talk to ea's president now. the second hour of "power lunch" starts right now. >> welcome, everybody, to the second hour of "power lunch." i'm tyler matheson. some unusual volume movers to tell you about. eastman kodak trading above its ten day average. in tegris energy trading above its average. new highs on a down day. stocks hitting 52 week highs including disney and u.s. steel. >> results of treasury auction, $43 billion in three-year note out in a moment. as soon as rick santelli is ready he's going to give it a grade. there's a lot of folks watching the situation with treasuries. there's so much supply coming on, a string of them, steve liesman you're sitting here as well, a string of them that has not gone well. investors are going to demand higher interest rates from the government to hire money. >> a ten-year at 4%.

>> yeah, 4%. i will tell you there's a lot of thinking about what happened at auctions last week. a lot to do with the end of the quarter, as much to do with the end of the quarter as other factors out there. i will be tomorrow for this show at citigroup's trading floor where we'll bring you the ten-year auction. that's going to be -- this three-year obviously is interesting. but the more interesting parts are the longer term. >> not just the question of how much buying there is and how much supply but who is doing the buying. >> there's a shift. americans are saving more. foreigners relatively want our treasuries less. >> central banks aren't buying. >> yeah. >> what do you expect to see for the ten-year. >> i think the ten-year will be interesting. the debate that's out there now in the market is are we forming the bottom of a new leg up or simply trading at the top of a range where we were. we tried to come over that 4% range but harder to get there. we've come back a little bit. 4% is the threshold tomorrow.

we'll look to judge the auction. >> is this crazy? we had leon cooper who said he wasn't buying bonds. you have to think do i want to give the government my money and only buy 4%. it seems absurd on its face, doesn't it? >> for a person like yourself who has the choice to buy bonds or equity. a lot of people buy treasuries because they have to buy treasuries. that's what they do. central banks who have to recycle dollars -- we have rick right now. >> reporter: yes, recycle the dollars. hello there. all right. 1.776 is the yield. we talked a few moments ago. that's right around the threshold. that alone would make it a b. i like the 3.10 bid to cover, above the 2.93 ten-year average. 10.7 on direct higher than 9.3 and 52.3 smack on in terms of indirects. i guess summarizing all that, i would give the auction a b. >> do you agree with that

liesman? >> i agree. not much controversy on the short end of the curve. i wouldn't argue on the 2s and 3s, but the 5, 7 and 10s way more interesting in terms of the government's ability to place it. the only thing i point out it appears given better tax receipts in march and hopes for april, that's all it is right now is hopes, that essentially we may have reached the peak of deficit financing right now. >> does this confirm there was an end of quarter factor at play in the most recent stuff? and now we're into the next quarter, things look a little differently? >> i think there is, of course, an end of the quarter, end of the japanese fiscal year affect that might have been something in march. in terms of the balance issue in tax receipts looking at revenues better than the worst case of last year, you also have to look at the spending side. many of these states still haven't gotten spending under control and it's a combination of both. >> just to be clear what we're

talking about here, federal government spending, states have all kinds of problems. all of this is incredibly pro cyclical. the worse for the my economy, the worse for the deficit and better for the government when things turn around. >> through there like the babs program is a federal program but it's addressing the weakest states. >> build america bonds. >> we haveing to to john harwood with breaking news on the massey mining tragedy. john. >> reporter: july julia this places front and certain lob ying, campaign, revolving door that surrounds regulatory issues in the united states the among the things that have come out in the last 24 hours. physical of all, massey energy was fined at this particular mine cited for 495 violations in 2009 amounting to almost a million dollars in fines. massey has taken an aggressive stance towards contesting those

violations. they have contested two-thirds of those in 2009. that's one of their strategies. another has been to work the political process very hard in terms of campaign donations. don blankenship, the head of massey energy, very involved in supreme court election in state of west virginia. also the federal mining agency head during the latter part of the bush add manage was a massey executive. he did fine massey for some violations. you can't say he was entirely looking the other way. people, particularly democrats, union officials who are looking for a more aggressive stance from the obama administration look at the administration, bush administration's record of working the coal industry and using coal executives in regulatory positions as part of the argument for a stronger stance. that's part of the update. >> we appreciate the update on

this evolving and tragic story in west virginia. in less than an hour the fed is going to release the minutes of its march meeting. all day long we have been bringing you thoughts on a range of topics from one insider at the meeting. it's not our senior economics reporter steve liesman but it could have been. he joins us with the final installment. this is like harry potter, the final installment of your exclusive with the president of richmond's fed, mr. lacker. >> central to the economy housing, commercial real estate and of course that deficit we were just talking about. we're concluding this interview with jeff lacker with his fairly upbeat views on at least two of them but not on the third. >> ours is one of the handful of districts around the country, federal reserve districts where a commercial real estate exposure is pretty significant among our community banks and some region always.

and it's significant in particular slices of the industry. it's a manageable problem so far. >> do you feel as if the banks have substantially worked through their exposures on residential real estate? >> some banks are still working through them. but i think the path ahead is clear for that. i think more broadly the economy has a lot to difficult guess on the residential side. we've hit sort of an equilibrium where we'll get half a million starts a month on an annual rate. prices seem to stabilize. i think that was the key. from now on it doesn't look likely housing is ever going tab drag on growth to any big extent. >> how much of a threat to the economy right now, to price stability, and to maximum employment do deficits represent? >> i think it's a significant challenge over the next few years, throughout this expansion. it's going to be more public

sector borrowing than otherwise and less private sector capital formation than otherwise. private sector capital formation is what drives increases in productivity and increases in standards of living for all our citizens. so it's going to mean slower improvements in standard of living, slower gains in real wages than otherwise. can those expenditures make up for it somehow? i don't know. we'll see. but it's going to mean slower growth than otherwise, i think. >> as we reported earlier today, lacker does not see a jobless recovery but modest job growth that sell ray as the year progresses. michelle as productivity declines as he expects with huge numbers as we've had, he expects job growth to increase. >> let's have a discussion with chief u.s. economist from barclays. good to see you, dean. what do you think about what you just heard from lacker. >> i agree with much of what president lacker said. i do think job growth will pick

up significantly. we think it's going to be stronger than the fed's baseline forecast. we see the unemployment rate falling to 9% by the end of the year, a half percentent more than the fed sees. we expect the fed to move later this year. the first hike later in september. the fed after five more months of job gains we think will be more comfortable at least beginning the process of normalizing the funds rate. >> steve, what do you think? after their conversation, do you agree with that? >> i'm not sure the first thing the fed is going to do to import the market is raise rates. i think a series of operations to drain liquidity and sort of make it feel like the tight think cycle has begun but not necessarily. we had lacker selling assets and mortgage-backed securities first, i think that's unlikely. i think we'll see a massive and somewhat startling liquidity gains as the year progresses. >> dean, you know, seems like

every guest comes on and says once they raise interest rates that's it for stock prices, they will go down. leon cooperman on "squawk box" this morning said no, a good sign the economy will be strong enough. >> we do think as the fed begins the process of draining reserves, i happen to agree with steve, the first step will be draining reserves, there will be something of a headwind for stock. we don't see major downward movement on the stock market. >> what's your reaction to lacker's comments we just heard about the residential and commercial real estate recovery? >> it's going to be a slow recovery. there's no question about that. i definitely agree that housing has bottomed out here in terms of construction. it's not going to be a booming rebound, but we do think housing starts, new home sales will be rising toward the end of the year. >> what about messaging, steve. you say before they raise rates

outright they are likely to do draining of liquidity in other ways. are they likely to drain some of the message, which is extended and exceptionally low before either of those things? >> all right certainly. i think we will get plenty of signaling from the fed chairman and other members of the federal reserve that things are about to turn, that language is going to go away. we get hyper as fed reporters when the fed chairman gets up. the first thing we look for does he say extended period and exceptionally low. he says it every time because he knows we're keying on it. that language will go away. next a signal from the new york fed they will do a large reverse repo or deposit that could be the size of 50 or $100 billion where they take a bunch of excess reserves out of the system to see how that calibrates. a test but not really. >> dean, what do you say about that?

>> i agree with the time line. we may see a language change later this month. if not, probably in june. we do think that language change is going to come in the second quarter. next comes the reverse repo draining. we expect that midyear. >> nobody can say they didn't warn you. that's what we're adding up to, dean, steve? >> they certainly are going to be clear about this process. the only question at this point in a sense is what the timing is. >> that's right. most people are thinking there's no way the fed can get this right. seems like, dean, you think they will get it right. >> it's going to be tricky and difficult for the fed to do. we think the chances of them getting it right are greater if they start on the earlier side rather than waiting too long. that's why we do think the fed will be in motion this year. >> let me point out, dennis, that inflation, core inflation is 1.3%. headline in flag is coming down and has come down for three

straight months to 2.2%. as far as the inflation goes they have that part right. they have done a decent job getting in. the job is equal and the judgment cannot be made until they have gotten out. >> dean, thank you. good to see you, steve. thanks as well. good job with lacker. >> the fomc will release meeting minutes from its most recent meeting in an hour from now. of course street signs will cover it liver. i expect mr. liesman will have a part in that. >> i think i might be there. >> let's get to our market reporters beginning with bob pisani. >> reporter: we're expecting great numbers on retail sales thursday. all right some beaten up sectors are reflecting that. real estate investment trust, telling you about it this morning. some of the big office reits hitting new hires. head of maguire has been offering potentially to buy properties from his own country.

sl green received good numbers, vo rna do in that space, brookfield. look at hotel reits. tell you how revenue per available room key metric for some hotels, marriott doing better, look at reits, strategic, felcor hitting new highs. buy high-end properties and lease them out or manage them themselves. as for what's going on with fomc, they are very interested down here whether there's discussion about eliminating that exceptional language. i think you'll see the market move on any indication of that help. trader talk@cnbc.com. >> it's a classic day. i was watching earlier the nasdaq stuck at its 52-week high set march 25th. it's moved ahead of that by a point. if we closed it would be an 18-month high, the highest since the lehman collapse. russell at a new high at 700.

amazon and rim big movers, apple inching over the high as well. take a look. new highs all across, 130 of them on the nasdaq. that's one thing one trader was pointing out. we may be doubting but getting big names like jdsu, autodesk, review data, regional banks as retailers as well. let's head on now to the nymex and sharon. >> reporter: bertha, the oil rally has stalled here at least for the moment. we are looking at oil prices that are slightly lower here. keep in mind we've seen tremendous gains over the last succession, up 10% or so. i want you to look at the prices along, the curve. two or three weeks ago tell you about a number of analyst pointing to the fact it looked like the curve backwardation, contract more expensive than latter months. that hasn't happened. the spread has widened which

leaves some analysts to point out this shows there's really not the demand for front month contract and perhaps this means this rally not sustainable. when you lo at energy prices across the board we are lower. that energy department report did not do much to support prices here. back to you. >> thanks so much, sharon. coming up next, does abc need to change the name of the popular show from extreme makeover to extreme foreclosures. inside the mind of home buyers and home sellers. is a home a good investment. is it okay to walk away from an under water mortgage. a new fannie mae survey. "power lunch" back in two minutes. great. come on in. would you like to see our new police department? yeah, all right. this way. and here it is. completely networked. so, anything happening, suz? she's all good. oh, my gosh. is that my car? [ whirring ]

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fannie mae out with its national housing survey on how the real estate crash affected consumer attitudes about housing. this as we head into the crucial spring selling season. so what do americans think about walking away from under water mortgages and owning a home as an investment? diane olec joins us with details. hi, diana. >> high, tyler. this is the first time they have done a full scale survey on how americans look at housing. how things changed. 83% thought it was a good investment in 2003, today it's 70%. 73% believe home prices have bottomed. >> i think it probably has

permanently altered this generation's view about whether housing prices can fall nationally. is it safe? they rated about as safe as cds. >> americans have gotten more realistic about houses and morns in particular. in fact, nine out of ten think it's unacceptable to walk away from an underwater loan. but that attitude changes if you figure in financial distress. and underwater borrowers are more than twice as likely to walk away if they know someone else who did. this as we learn a new wave of foreclosures is now hitting. >> i do think we're seeing the turn though as 30 days delinquencies have peaked. we still need to clear that before full health is restored to housing. >> would youou say in the next months we will see new records. >> i don't know. we don't have a forecast of

that. certainly some of the foreclosure back logs are working their way through the system at this point. >> we're having a great debate about the foreclosure crisis on the blog. go to it at realty check.cnbc.com. tyler. thanks, diane. >> speaking of foreclosures, reporting today that the popular tv show "extreme makeovers" is undergoing a make over of its own. extreme foreclosures. they have been building mcmansions. each episode features a tug at your heart tale, a makeover and bigger, better home. after they leave the owners left with bigger tax bill, bigger utility bill, bigger everything. they are scaling back instead of 5,000 square foot homes they are now squalg bacaling back to 3,0e foot homes. what do you make of this, people don't know how to manage their

winnings snfr exactly. we heard about someone who won "extreme makeover" and got in trouble again. remember, they are in financial straits in the first place, that's why they are on the show. they are getting a brand-new home with a lot of home equity. a lot of pulling out the equity to pay for increase cost of the home and pay down other debt and that's where they are getting in trouble. i hate to say it. i don't want to get in trouble with folks at nbc, but i'm a big fan. they build them in not great neighborhoods. that's why it's impossible to resell them. who is going to buy this massive mansion not in a great neighborhood. also you see these folks who are going to have to pay a lot more than they ever thought before. they have gone from, perhaps, a tiny one-room home to a seven bedroom mansion and that costs. >> it may be fun to watch because it's unrealistic, unrealistic in terms of the neighborhood and the terms of the cost it brings to the

owners. >> diana, you follow the housing market closely here, is there one part of the survey from fannie that surprised you? i was surprised that 73% of the survey said, yeah, home prices have bottomed. >> i was surprised at that for one thing. another thing that surprised me that we didn't report because we only this a certain amount of time. more than half the people surveyed thought really the housing crisis was more the borrowers fault than the lenders fault. >> really? >> we're here in washington. we hear all about banks and fraud and subprime mortgages and how it was all the big, bad lenders forcing these folks into the loans. in this survey, it showed 53% asked thought it was the borrowers who bit off more than they could chew. >> i'm glad we had time to get that extra fact in there. good job. >> when you buy more house than you can afford and use your house as piggy bank, which so

many did, myself included, i took a home equity line for an addition. >> that's what's going on on home makeovers. >> taking money out of this fatter richer house, ostensibly more valuable, you start to skate on thin ice. >> anyhow on that happy thought. >> you hear that? we have to go, the music. >> is that what that means? i'm new to this. >> coming up, business women in the east, her plan makes sure south korea is the leader in asia. >> you may have seen her bag on the hot tv showsome gossip girl." can this ceo be a multi-million dollar player in the fashion world. she will tell us in a few minutes. with expedia, i've got the building blocks

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despite the economic downturn luxury fashion house mcm worldwide continues to reboot its global brand in a big way. one of asia's most successful business women, she bought mcm in 2005 and has since sunk more than $40 million of her own money into it and in the process set the industry abuzz with her plans for retail domination. welcome to "power lunch." >> thank you very much. >> what is your strategy and price point. >> it's a german luxury brand i acquired 2005. and now price point is comfortable but luxury, so like louis vuitton, so $700 is the

average price. >> this bag on "gossip girl." you're much bigger in asia than the u.s. are you planning to expand to the u.s. >> of course. when we acquired in 2005, sales of $100 million, which was a lot in asia because asia really booming, china, korea, japan. since we launched in europe, germany another big market. >> are you a little late on the bag craze? we went through a bag bubble in the united states for sure. every woman in new york, at least, the crazy ones on the upper east side. they had to go to saks and blow three grand at a time. i think that was crazy. that was slowed down dramatically. are you late? >> i don't think so. still, it's not new. we launched in germany as kind of a new luxury, which is quite different from conventional luxury. in men's your luxury targeted for courier woman, not just

bling-bling buyers, expensive, something more functional. >> are you going to turn into an asian brand so asians that buy mcm think it's a german brand. >> more german heritage. >> you're going to keep that. >> absolutely. >> i'm sorry for the prying question but it's what i do. where did you get the $40 million of your own money to buy this company? how did you make your fortune? >> in fact, i was one of the pioneer in korean market bringing luxury brands including gucci, so i learned all the skill set. now i earn money, of course. when i launch and sale in korea early '90s as a licensee, we made more than $100 million business, one of the largest handbags in korea. >> you turned around and bought the entire brand. how important, or is it important at all, that you have actual retail outlets with your name on it the way vuitton does?

>> the fact we have already 100 direct stores run mostly in asia, primarily china and korea, even japan, europe like london, berlin where -- >> is it critical to succeed there. >> very important, indeed. >> you roll out a lot of stores in the u.s. >> of course. we already have one here at the plaza hotel. >> why bother when all the growth is in asia? where everybody says they are closing up shops on firefighter avenue and opening them in shanghai. >> in fact -- as you know the china 1.3 billion, 10% of gdp growth, staggering growth we expect, more than 25% of total global luxury market exists in china. >> she says why bother open stores in the u.s.? why focus on the u.s. >> because u.s. is a great market. i love u.s. >> because asians still want to own what americans buy. we set the trend? >> i'm going to make a man like

you buy the same, too. asia as u.s. there's very strong hispanic and asian community exists. also there's young professional women, american ladies, they love to have a new luxury coming out, really catering 21st century globe trotting. >> we make from germany, korea. >> thank you for joining us. we'll be curious to watch your company expand. >> thank you. >> coming up on the half hour. matt nesto ready to go beyond the big caps. we'll head to the floor of the big board and take the mashts with steve brasso. >> off the charts, a blue chip up more than 100% in the last year. stick around for that name. no puns this time. back in a few minutes.

welcome back to "power lunch." here are stories we're following at this hour. toyota will continue to offer most of its big incentives through april. according to published reports, renault, nissan and daimler will partner on small vehicles.

u.s./brazil, billions in subsidies paid to american cotton farmers. for more on today's market moves let's head back to the floor of the new york stock exchange where they are standing by. i hear you say we are going to hit 1200 for s&p 500 next week and 13 by september. what are your predictions. >> the only thing that truly worked are technicals. off to the 1044 on the downside we bounced off that level. that's all that has been ringing sounding true for the marketplace. technicals fundamentals look good but technicals are what they are basing their opinions to buy and sell the market on. grinding higher, volume is light. i think it's going to continue having 1200 next week, middle of may s&p. >> how about dow, is it a resistance point? >> of course it is. i don't trade based on the dow,

i'm more focused on s&p. 11,000 is the resistance point. we should obviously over take that if we're moving higher in the s&p as well. >> what do you make of the movement in oil and also people talking about gold earlier today. >> i think gold, i actually bought some of a minner stock for myself and my retirement plan. i think eventually all this debt we're running up will come back to roost and gold will be the safest way to play it. it doesn't mean tomorrow or six months but eventually that's the way you'll see gold move higher. i had no exposure to it and i wanted to give myself some. >> thanks so much, steve. >> let's hold him to it. 1300 by september. way to go. beyond the big caps, smaller names that are big movers today. matt nesto. >> beyond the big gags. big caps. small caps once again leading in the junk rally, melt-up. on a week to week basis more

stark than what you're seeing today. although it's slight, folks, it's a winner by three lengths. as i said on a week to date basis, up 3% for small caps versus less than one for s&p 500. so the first member of the dating game, msc industrial direct. this is a retailer masquerading as industrial. over 600,000 excuse. they sell industrial supplies that compete with companies like granger and facen all. earnings are coming out tomorrow. they are based in melville, new york. stocks over 200% of its ten-day average volume. a new 18-month high. they are seeing resistance at 54. now on the other side, on the losing side, as the small cap name align technology best known for their invisalign invisible

braces. the clear alternative to braces. cut to sell from buy. they think the stock will see weakening demand as doctors who had a proficientsey status they had to achieve. there's coming competition from others. that stock getting slammed today, 500% of the average daily volume. it did come down from a three-year high it hit yesterday. >> thanks, matt. back over to you, michelle. now to a name off the charts, caterpillar hitting a multi-year high. shares gaining 170% since the march bottom. economic data showing signs of improvement, is there even more room to go? take a look, it's a very nice move. joining us from st. louis an analyst with long bow research. good to see you. why has the stock been climbing so dramatically, simply the cyclical rebound on the economy.

>> caterpillar represents global research in mining. that's hot. >> will it stay hot. >> fundamentals have yet to catch up. sales still down through february, 20%, 30% domestically. engines down 33%. we're still seeing weakness in the construction-related sectors. the only part of caterpillar starting to perform is mining. that's 25% of their business. >> a neutral on the stock still. >> absolutely. >> do you think it's overvalued at this point? what would make you get into it or be more decisive and sell it. >> caterpillar is running with the market. you don't want to fight the tape. as long as everybody is in love with infrastructure caterpillar mining, it will perform. it's not there yet. it reflects earnings out for several years, 2012 if not 2014. that's a little aggressive. we'd rather play component suppliers to caterpillar which we think is a much better value today and give us a kick.

related to the health care reform law? >> correct. that's a technical change. they had a subsidy, that loophole was closed. the market past, stocks gone up, doesn't matter. >> sizable enough to make any kind of difference or still small relative to the overall size of the company. >> a meaningful charge, but really just closing a technical loophole of a subsidy, not indicative of health care. the market is ignoring it and we don't think there's any merit in the company. >> thank you very much. caterpillar off the charts but he's neutral. >> likes the suppliers better. >> exactly. up next. you probably heard that terrible story about the massachusetts girl who killed herself after being bullied in school? it included cyber bullying. some people think social networks share the blame in cases like this. >> should they be held legally liable. what do businesses need to do to protect themselves in a world of facebook, twitter and youtube. answers in two minutes. that'll

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arraignment today for three massachusetts teenagers charged with bullying a 15-year-old girl to death. prosecutors say phoebe prince committed suicide after months of relesser antillesless attacks, facebook and postings online. should social networking share the blame and are they liable? let's ask vice president of digital strategy on the brand side and joel reddenberg, director center of law and information policy forum on the legal side. joel, legally, is there any way

facebook will be held liable for bad things that happen like this? >> i think it's very hard today. the law gives hosting services a wide degree of immunity for what happens on the website. there's a couple of angles we'll see pushed, namely the terms of service for most of the sites say that users can't put harassing or illegal content online. there's going to be a push to hold organizations like facebook. >> can't put harassing content on line. that will shut down the buyer internet i can say from personal experience. bill, on the brand side of things, even if facebook shouldn't be held legally liable, what about the damage to the brand? when you get linked to a suicide, i'm thinking your ipo brand goes down. >> the responsibility they have will very much affect their reputation. it's easy to look at the recent challenges toyota had, what do they know, when did they know

it, what was their response to the situations. as organizations open up channels, these lines of communication, they very much have a responsibility to police what's going on. >> responsibility, should facebook, bill, be doing far more to jump on bullies who start picking out one kid and picking on her. >> it's easy to point the finger at facebook, they have 400 million users. they take an active stance on trying to police the content that goes through their system but it's a very full and dense ecosystem of conversations happening every day. i think it's up to everybody that engages in brands, parents, teens all have a role to make sure everyone is acting responsibly. >> google started posting a suicide hot line for people that searched for suicide on google. seems like that's a proactive stance to make sure they don't get in trouble for this kind of situation. do you think we're going to start seeing more proactive attempts to avoid this? >> i think we are. as you start to look at the pervasive of mobile

technologies, location awareness technologies, i think the way technology organizations can start to inner weave some of these functions into their systems is great. if i search for heart attack symptoms, they should provide me with something like dial 911. >> what do you think they should be doing to mitigate risk? >> i think first of all they have the capacity to do automated searches on the system to see if there's triggers to suggest particular websites are problematic. there should be an eye on it. the second thing, like we're seeing with blogs, have report abuse buttons, report risky on a teenager -- a site that's used predominantly by teenagers, have buttons that enable friends to report, hey, this is a warning. somebody wake up. please help. >> services indeed say, hey, report this poster. bill, seems to me the root problem is anonymity allowed

anywhere on the net. you can go and say anything libelous about anyone and google doesn't have to say who you are. >> there's a challenge they face. freedom of speech does not equal freedom of responsibility. in places like facebook where you create a profile it's easier, anonymity -- free speech is going to foster bad behavior in some respects. >> if we've got attorney general cracking down on craigslist, how long before we see a state proposed law for cracking down on harassment on facebook. >> i think it will happen soon. a quick comment on anonymity. there are cases where posters identities where posters have been revealed because of what they did online. look, this is deformation, other legal, not protected speech. and google most noticeable last summer was required to identify a blogger who thought she was

anonymous. >> about time we crack down. all right. bill evans, joel, thank you for being with us. coming up, debating a new neck working site called getunvarnished.com. critics say it could kill your business and reputation. allows anyone to create a profile about you and post reviews about your job performance, management style and reply taking, behavioral quirks and so on. has social networking finally gone too far? >> answer, yes, it has. that's exactly has that entire thing meant. up next is the story everyone is talking about this week, tiger woods. electronic arts is betting big on tiger again introducing a new video game today. >> tiger woods pga tour online: the liar. i'm kidding about liar. why did electronic arts stick with tiger when others dumped him. natural gas is a cleaner burning fuel,

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we're talking about tiger

woods, what else? he played another practice round at augusta. meanwhile electronic arts is sticking by their guy. the company unveiled a new tiger video game today. that could be on "saturday night live." darren rovell ready to tee it up with a special guest. >> reporter: tiger woods is the talk at augusta masters and also online. with us president peter moore. thanks for being with us. you had beta testing on this game, you're unveiling it. what did you find out in the beta testing, how interested were people playing this. remind me again what the future revenue model for the game is? >> they were very interesting. nearly 2 million rounds played since we went open beta, 200,000 visitors last month alone. we're also finding it's not your core typical gamer.

it's your 40-year-old male typically who is a golfer. 90% who played on the open beta were golfers that wouldn't buy the core game for 360 or ps 3. with regard to business model, micro transactions and subscriptions, free to play. so we're obviously intending to bring people in for free and then our job to upsell them. >> people are obviously interested in the console game as well coming out this summer. sharing the cover with roy mcelroy, i believe. projections on how the tiger woods game will sell? can you say that now? does it depend at all on his performance on the course. >> tiger woods pga tour 11 ships, the wii as well as the iphone. we're seeing strong interest. we gauge that by presales. this weekend will help but not a determining factor.

tiger certainly has withstood some of the issues in his personal life over the last few months and we've seen no drop-off in business during that period of time. >> gatorade. >> sorry, peter, julia borsten in the studio. wonder how tiger's infidelities have charged the marketing or packaging of this. what changes have you made since november. >> we have made no changes. we've had this in development a year and a half. we've been clear in our support of tiger the golfer. he's been with us for 12 years. we've had a strong relationship. he's a gamer himself. he's been instrumental in helping us develop the game over the past 12 years and we're very, very supportive of his return back to the golf course as i think obviously the entire golf community is. >> take me inside the boardroom, if you wouldn't mind. i have to imagine conversations got heated at some point. were there people in there that said, we've got to cut bait with this guy? >> not at all.

>> none? >> none whatsoever. we are very different company regards our relationship with tiger than maybe other sponsors that have cut bait with him. he's been on the mast head of our game for 10 years. he's in the game itself. he's not an arm's length endorser. he's the world's greatest golfer until somebody proved otherwise. >> i heard correctly not one board member even questioned it. >> obviously there's questions. you look at the fact, what we stand for as regards our ability to deliver world-class simulation of golf around the world in consoles and pcs and possible devices. while we've been very supportive of the challenges he's gone through in his personal life, this is about simulating the game of golf. we've been very, very, very clear we're supportive of tiger the golfer and very supportive of the challenges he's going through in his personal life. >> peter, a lot of people around here basically said or felt it was the bottom yesterday.

this was ready kind of the end of it, at least as far as we know, and it's going to be up from here. how much of an upside is there on tiger now if he continues to be the best golfer in the world? is there potentially more of an upside now for the companies that did stick by tying center. >> well, i guess i would hope so. we look at this weekend as obviously all of the golf industry and sports industry does, what shape is he in, how well is he playing. we're delighted as everybody is that's interested in sport to see him back. a great deal of interest as you point out in the press conference yesterday. i think he was forthright and forthcoming with the questions that came about in a 40-minute session. now it's all about golf. there's no doubt in my mind personally that that first tee shot on thursday might be the most watched golf shot for many, many years. >> okay. >> you've got it. >> peter, that you so much for joining us. guys, back to you. >> thank you. >> "power lunch," the fed minute

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we begin with breaking news, release of fed minutes from the march meeting. steve liesman with the headlines, two, one, go steve. >> pretty significant minutes coming out here, the fed making a play for flexibility and the language how it defines extended period and extended period language. members are noting that language does not represent a fixed time. several fed members said publicly that it does. now they are kind of dialing that back. extended period language does not limit the ability, say the limits or some members of the meeting to tighten policy. don't get excited. they are going to say extended language doesn't keep us from keeping the monetary policy in place longer if it worsens or declines. the risk of early tightening exceeds the risk of a later start. the staff, fed staff marked down gdp outlet because of lousy housing data before the march meeting and local state and government spending numbers.

the staff marked down inflation outlook for 2010 and '11. members said inflation data came in lower than they had originally expected, despite the q1 pickup in consumer spending they still see the consumer as restrained because of the lackluster jobs market and housing problems. members were concernedish for example, about the scarcity of job openings in some of the data. and of course what we've been talking about here, long-term unemployed. the recovery is seen as unsustainable without a pickup in jobs. renewed concern about housing despite the reports out there. few concerned deficits, easy fed policy did tilt inflation risks to the upside. there's that conflict as inflation, not as strident as the past, all agreed to say with exceptionally low language. all but one who has dissented twice. he called for a low level. kind