money" tonight at 5:00 p.m. follow me on twitter of cour course @scott wapner. thank you, scott. we have three hours to go in the trading day. and investors are watching a greek drama once again. while traders wait for some kind of resolution in athens, the major averages are in bull territory since the october lows. should you be all in, or should you be worried, ty? >> battered bank of america up more than 40% this year. you heard me right. it's best level now since last september. is there still time to get in on the action? or is this stock just too hot to handle? >> plus, the art of investing. billionaire investor lauder invested in everything from media to mining but spends hundreds of millions on art. he'll tell you why it's a beautiful thing, at least moneywise, ty. >> brian, thank you very much. i'm tyler mathisen along with sue herera and brian shactman. "power lunch" begins right now.

market's relatively calm. i want to tell you we're getting a little bit of a lift here. the nasdaq's gone positive. the dow inching that way and the s&p .1% to the downside. we might see more green in "power lunch" here. we are still waiting on a deal from greece, but i have said that almost every time i'm on this show. here's basically that's where we stand. take a look at the pulse of the markets next to the euro coming off the two-month high on the slow pace of the greek talks. 10-year is back below. we'll have auction results in just a minute with rick santelli. they have also come around here as we see a full market turnaround a little bit. now up .5% and inching toward $99 a barrel. midday movers the action at caesar's just crazy. 80% to the upside. also talk about ralph lauren. they beat expectations on their

earnings. and cerner up big. one more winner, one of my favorites, buffalo wild wings up almost 15%. on the flip side, we have panera bread, profits beat but revenue didn't. western union, same story line, same result. they are down 8%. sue, back to you. >> brian, thank you very much. breaking news now, $24 billion worth of 10-year notes up for auction. rick santelli is tracking the action at the cme. how was the demand? what's the grade? >> let's go over metric and then get to the final grade. keep in mind those $24 billion fresh tens, these aren't reopenings. the next two auctions will be. the yield at 2.02. the low trade i saw on the yield driven when issued market was right around 199.5. but the wi was trading around 203. we went through in a good direction. that's very good.

look at 10 auction average bid-to-cover this time 3.05, a little light, 44%. the indirect 10 auction average this is a 38.9 on the pricing side on that yield, that's good. so i'm going to give this a b plus. it was a little deficient on the bid-to-cover, but this is probably a pretty good thing because yesterday dealers took an inord nant amount of the 3-year. >> good point. thanks, rick. >> let's head to the trading floors and they can in with bob pisani. >> about even on the advanced decline line. s&p 500 about 11:00 eastern time concerns that perhaps the ecb which is meeting tomorrow is not going to offer as much support to greece as they had envisioned or some traders hassin visioned and that's because there's no greek deal yet. you saw the weakness there in the stock market. and we've been coming back here. dow and s&p just about to go positive now. elsewhere a little bit of the

weakness also attributed to the energy stocks. we did get the weekly oil inventory levels, inventories a bit higher than anticipated. all the big energy names dropped a little bit on that news. look at the sectors either side of positive or negative, energy the weakness. on caesar's a quick note, two hours of traders, 8 million shares have traded hands. it's traded almost five times as many shares as there are actually outstanding. in other words, each share has churned over. there's a lot of churning over in this stock priced at 9 as you can see 16 and change right now. sue, back to you. >> thank you, bob. let's switch on the "power lunch" power surge and drill down on the stories driving the day. and we turn to greece where greek leaders are meeting for crucial debt talks, but questions are mounting over whether or not the country will indeed hammer out a cost-cutting deal to avoid a default.

our julia is in athens with the latest on that. julia. >> reporter: thanks, sue. the greek media here are calling this meeting the most crucial in the nation's history. it began around 5:00 p.m. when coalition leaders and the prime minister began discussions on the vital reforms. vital at least to get a sign-off on this bailout deal. a close source to the meetings tells me that the new democracy leader and possibly the next leader of this country, according to the polls, may have demanded a date for the elections in order to sign-off on this deal. i'm also hearing that cuts that aren't included in this agreement today or whenever we get this deal agreed will still be up for discussion later in the year around june, quite possibly. now, in the last hour the group said they will meet tomorrow to discuss, the question is does this mean we're approaching a solution on this reform deal? or is it just yet more pressure from europe? now, of course, we've also spent

a lot of time today talking about the possible participation of the ecb in the debt writedowns. interesting timing given the s&p have now come out and said even with a 70% writedown on this debt here, greece's debt is still unsustainable. that's on the private sector participation here. though, for now, we're continuing to watch this meeting. and we'll keep you abreast of any news as it comes. tyler, back to you. >> julia, thank you very much. let's get to politics now and headline grabbing results in the gop primaries. three-state sweep last night for rick santorum. so is mitt romney gone from top dog to underdog? our chief washington correspondent, john harwood, joins us. john john, neez are not headlines the romney camp would like to be fighting today. and it points to the idea he does not galvanize a lot of support in the real core of his own party. >> absolutely it does. we knew mitt romney might have a

stumble last night and that rick santorum might breakthrough. these are small turnout contests in colorado and minnesota. they were caucuses, which involved the most zealous and activist people within the party. but look how bad this night was. take a look at the numbers in missouri mitt romney lost better than 2-to-1 to rick santorum. in minnesota he lost better than 2-to-1. and in colorado a state where the romney campaign thought they would have an advantage in the end, he lost by a significant margin to rick santorum. excellent night for santorum. gingrich didn't score but i talked to one of his advisers and he said the republican base is in revolt against the prospect of a mitt romney nomination. and mitt romney has to get up today to change the storyline going forward with big primaries coming up in arizona and michigan late they are month. >> whatever hurting romney helps him. but was obama the big winner

last night? >> he was, what we've seen in the process is that mitt romney tends to win by going strongly negative on his opponents. you can expect he's out this morning with an attack on both newt gingrich and rick santorum on pork barrel spending. it also blows back and hurts mitt romney, his unfavor blt ratings have risen. and look at president obama's favor ability is rising. this avrn for real clear politics 48% approve of obama's performan performance. that's not robust or hugely impressive, but he'd been under water for much of the year and he's hit the 50% mark on a couple crucial recent polls. it indicates president obama is getting stronger while mitt romney's increasing level of difficult di in this republican race, tyler. >> john, thank you very much. >> to corporate news now where news corp. is fighting claims

after the bell. julia boorstin is on the report for us. >> rupert murdoch made some progress. it settled at least 15 lawsuits that were by phone hacking victims. news corp. certainly hopes that the settlements will minimize the fallout from the scandal. there is one case ready for civil trial that was due to start next week and it's been delayed since end of february. news corp. has settled 54 of 60 lawsuits paying about $8 million to resolve the claims, but more than 50 victims are said to be preparing new suits. we'll have to see if the company says anything more about the hacking scandal on the company's earnings call, which is coming up after the bell today. analysts expect news corp. to report earnings of 34 cents per share, a 17% increase over the year ago quarter on 2% higher revenue of $8.94 billion. for news corp. we're going to be watching for advertising trends, also subscriber revenue at its cable networks which is its

biggest division. we could also expect some questions about what news corp. plans to do with its mountain of cash now that it's abandoned its bill for -- it's bid for b sky b which was also part of the fallout from the hacking scandal. sue. >> julia, let's switch gears. amazon striking a deal with via com. how big a deal is this? >> it's a pretty big deal, but amazon has a way to go before catching up to netflix. this deal is licensing thousands of hours of video and thousands of episodes from nine different viacom's cable channels. but this content isn't exclusive to amazon. netflix also has a lot of this content. this deal offers $79 a year. since it launched a year ago, amazon has struck licensing deals with nearly every media

con conglomerate. but netflix has over twice amazon streaming videos and dominates the market. but it does face some growing competition. not just from amazon, but also from this upcoming redbox and revise on venture. we'll have to see if amazon decides to pony up for original content like netflix has, which of course is a whole new business. >> sure is. >> back over to you. >> thanks, julia. >> and up next, markets roaring ahead this year. in fact, if you trace back to last october and you count to today, you would find yourself in bull market territory. should you be all in? or are there serious reasons to worry? we will talk headwinds, tail winds and no winds. >> all kinds of winds. let's take a look at the commodities complex. a lot of people say get ready to pay more at the pump because look at rbob gasoline up a full percent today. back in a minute. line dating set kind of expensive. so to save-money,

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welcome back to "power lunch." i'm seema mody. time for three stocks in 30 seconds. starting with rambus. it's been in the news a lot, climbing higher after finding a resolution to one of those disputes signing a licensing agreement with the chipmaker. another stock to watch out for, akamai technologies.

a company helps accelerate the speed of websites. lastly, brian mentioned this at the top but we're keeping a close eye on caesar's. our own kayla tausche will have more details coming up on "power lunch." for now, tyler, over to you. >> seema, thank you very much. the markets sort of struggling a little bit today. make no mistake, the dow is in rally mode recovering very nicely from the march 2009 lows up nearly 100% in that period of time, three years. in fact, all three major indexes charging to the upside over the past few months now in bull-market territory since october of last year, each up more than 20%. so much green on the board that blackrock's chief said today he thinks investors should be 100% in stocks. should investors be as bullish as mr. fink and go all in, or is there reason to be cautious? and joining us is another larry, managing partner with may flower

advisors. larry, let me start with you. you are, you say, becoming increasingly bullish. and one of the areas that you like, low and behold, is european multinationals. a lot of people would say what are you nuts? make your case, larry. >> yeah, larry fink has the right idea here. we know he's on the right track. maybe it's not 100% stocks for all investors, but we know stocks represent a compelling value relative to many areas of the fixed income market. bonds have had a 20-year bull market and stocks have done nothing for ten years. investors are desperate for returns and embracing the equity market. we see a bull market moving here. we see a bull market underneath. we see a sector rotation. and when we see the action where investors want to be, we see movement towards many of the european areas. >> companies like, larry? >> sure. absolutely. when we look at some of the more cyclical industrial areas, all the areas beaten up last year are seeing relative strength this year because that's where the compelling value is.

a european telecom company, companies like total, all around the world, siemens, companies that play on global growth. global emerging market growth at big discount here and investors have been hiding in safe havens and they're going to bet burned. >> you're not enthusiastic enough, larry. [ laughter ] >> dial up the energy, will you? >> rich, the onous is on you. you have to match that performance. >> i have to throw some cold water on this party or something? >> i think you probably will because in your book "the bond market's always right" right? >> well, the bond market isn't always right. but the person with the most inside information is ben bernanke. and he's been pretty explicit. i'm not raising rates for years, the economy's not healthy, the labor market is not healthy. so you may be seeing all happy songs on stocks, but he's

encouraging us to look at this a little bit more less sanguinely. >> isn't he trying to get investors to take on more risk? put a little more alpha in their portfolio. which would mean stocks? >> my alternative to stocks, again, with what's going on in europe and the political system, to me is huge, huge risk. so if i believe that, i'll buy residential mortgage-backed securities and clip my 8% to 9% contractual cash flows. if i don't get those cash flows, there's no way you have a bull stock market. >> rich, i have to disagree with you. >> -- and more foreclosures. >> i have to disagree with you. >> jump in there, larry. >> i respect that the bond market has been a great place to be. but that was a 2011 and before story. that's not a 2012 story. when i see the fed, number one rule in investing is don't do

the fed. we're going to give you a negative real return if you stay in cash or treasuries -- >> let me talk to you. you're saying that i'm encouraging you to be in the bond market. no way. the bond market is big, much bigger than the stock market. >> sure. >> it is telling you that they're not bullish on the economy. you can't sit with a 1.9% 10-year treasury if the collective buyers are telling you that they're willing to accept that yield, they don't like the economy. i'm not saying i'd be in the treasury market either. i think it's way overbought. but it's the reality of the market. i'm saying the stock market is not my alternative. lower quality muni bonds are my alternative. >> so rich is concerned about sort of undervaluing the economic risk. larry, you say you are concerned about investors undervaluing inflation risk. >> that's right. >> those are two opposite things. mr. bernanke says he doesn't see

any inflation out there. why do you? >> that global liquidity that is being pumped all around the world ahead of the election cycle, not just here but in other parts of the world, will lead to future inflation. that is a risk that investors are not well-prepared for. one of the reasons larry fink told investors to get in stocks and out of bonds is because he sees the fund flow. he sees how much money has gone and what we learn investors can lose money in anything. there's no such thing as a risk-free return. many investors hiding not only in domestic so-called safe haven stocks that investment strategists have been recommending, but also in the bond market are running from risk and not being sensitive to the real risk out there, future inflation risk and higher interest rates which will decimate the bond. >> i agree with you there. i'm saying, no, there are two or three other places i would much rather be. >> i agree with that. >> you guys both get to come back, okay? >> okay. >> and continue this conversation. promise me you'll do that. thanks very much. we have to leave it there.

that was fun. >> it was fun. >> what's worrying you about these markets? you heard what rich and larry just said. e-mail us at powerlunch@cnbc.com. >> he likes his caffeine right before the show. >> he's a red bull kind of guy. >> he is. coming up next, believe it or not shares of bank of america up more than 40% this year. should you still get in on the action? or is the stock too hot to handle? you'll hear the case for both sides of that particular trade. >> and here's how the major banks are trading right now. bank of america, citi, jpmorgan, goldman sachs and morgan. tdd# 1-800-345-2550 so, i want to trade at a place that really gets who i am tdd# 1-800-345-2550 and what i need. tdd# 1-800-345-2550 and still gives me a great price. tdd# 1-800-345-2550 at charles schwab, you get everything you need tdd# 1-800-345-2550 to trade your way. tdd# 1-800-345-2550 all for $8.95 a trade. tdd# 1-800-345-2550 here, it's all about trading. tdd# 1-800-345-2550 start trading with the intuitive streetsmart edge platform

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to help you get where you want to be. ♪ because your moment is now. let nothing stand in your way. learn more at keller.edu. go tell that to the judge. judge wapner, let's check in with him and see what's on his radar. >> ty, thanks so much. watching letter s today. that of course is sprint. sprint got the iphone, sold 1.8 million of them in the quarter, but that comes at a high price because of the big subsidies that sprint and other carriers pay for the iphone. the result, a widening loss, sprint shares falling by 1.2% today. churn was up. they also reiterated they need

to raise $5 billion to $7 billion to build up the 4g network. one analyst comment just to give you some color from the street today, nothing in the quarter that gave people an indication it was time to buy the stock. only operator that sold less iphones than we expected in a record quarter for the iphone. guys, what was it 37 million iphones, i think, sue? >> it was a ton. lots and lots. >> in the past quarter? >> lots and lots. i don't know what the exact numbers are. >> i think it was 37 million. >> it's a huge amount. >> yeah. >> thanks a million. >> all right. >> all right. bank of america we're focusing on now. the shares breaking through $8 a bit earlier today. the first time that's happened since september 1st. and one of the worst stocks of 2011 is now the hottest stock in the dow surging 44% this year alone. is it time to add b of a to your portfolio? that debate now with jeff hart, principal at sandler onl. welcome to you both. appreciate it.

jeff, i'm going to start with you. make the bull case for bank of america? i know you have a buy on the stock although you've recently cut back your price target a little bit on it. >> i think there's really two legs to the bull case. they really both come down to timing. on a longer term time horizon, i think there's a lot more value in the bank of america franchise and half of current tangible book value. over time i think you do well at bank of america. the bigger question maybe comes in a shorter term time horizon is i look at it today with the market the way it's performing, i think you're going to see people underweight financials starting to have to chase performance. and they're very likely to look at some of the cheaper more unloved names. that's bank of america. so i think we have some upside ahead of us near-term. but then over the long-term you'll be a happy buyer or owner of b of a. >> maria, a lot of that makes sense, but you're not exactly convinced. some of that has to do with brian moynihan. >> correct. he's been ceo for two years now and he still has yet to prove he can really turn this bank around

for the long-term and that it will be a good value for the long-term. there's tremendous uncertainty out there partially because of about $14 billion of mortgage repurchase claims that the bank is currently fielding. and there's incredibly regulatory uncertainty as well. you have the cfpb, which is crimping down on consumer banking profits, bank of america being an incredibly large consumer bank. and you also have dodd frank and the debit card swipe fee amendments which killed about $400 million of revenue from bank of america's business from the third quarter to the fourth quarter. >> all right. jeff, do any of those issues worry you enough that they would change longer term your opinion of the stock? i mean, mr. moynihan has made some changes, investors have been less than patient with him certainly recently. but what about the mortgage exposure? how big of a risk is that in your scenario? >> well, i think, really from uncertainty becomes opportunity. that's one of the reasons you want to look at bank of america.

all of those points are valid. i think things to worry about there. but to really get too concerned about their mortgage exposures, i think you have to start thinking about a significant downward turn in the housing market. if that happens, that's bad news for bank of america. but i would also argue that's bad news for the economy and pretty much all banks whereas if things stabilize or move up some, not much is expected from b of a. i think they could post some upside on that. brian moynihan, he was dealt a tough hand. we'd be in a much different story or conversation about bank of america if they had not bought countrywide. i think he's doing what he can, but it's a slow big ship to turn around. i don't know anybody else could have moved it more rapidly than he has. >> yeah. maria, would your opinion of the bank changed if mr. moynihan was not at the helm? what about jeff's point? >> i think it's a fair point. also to the countrywide point, he hasn't really done anything with countrywide. and there's been a lot of chatter recently and argument

that he should have put it into bankruptcy a long time ago and that would at least get the bank further along the way to resolving some of these outstanding mortgage issues. >> part of the trouble there is we don't know if they can bankrupt countrywide. it's a complex issue. it's a nice thing, i think, for bank of america to have as a threat in negotiations, but to actually do it, it would be interesting to see if they could actually do that and leave some liabilities behind. >> thank you both very much. appreciate the conversation. ty, over to you. >> sue, up next, organic food and a very, very hot stock. we are talking whole foods up 45% over the past year. that's not just the pineapples. they will report after the bell. jane wells going to serve up the preview. you can also win with sin. phillip morris up. we're going to ask a top analyst if tobacco stocks can continue their smoking course. "power lunch" is back in two. [ male announcer ] the draw of the past is a powerful thing.

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welcome back to "power lunch." a quick check on the markets because now we have the s&p in positive territory. and the dow is getting closer. having said all that, everyone says it's a quiet day but

volatility's ticked up 3%. maybe it's not as quiet as some might think. 10-year still below 2%. the dollar index is flat. we'll get to gold in a minute with bertha coombs. and we have wti up about 16 cents. it's come off the highs there. want to go inside the dow quickly. we talked about bank of america just a few minutes ago. we're watching that $8 level. it's currently above it. disney, a very interesting reversal. it was down about 1% in pre-market after earnings. that's reversed itself and same is true the other way with mcdonald's after strong comps looked headed toward new highs and now down 1%. and microsoft, i am obsessed with the $30 level. s&p 500 widening a little here. hartford intercontinental exchange. the drag was eps guidance, joy global removed from the key call list at ubs, the mining equipment maker is a perfect segue by the way to bertha coombs at the nymex. because they make mining equipment. so lets talk about metals.

>> yeah. mining the metals indeed. we've got the gold close coming just about right now. it's been a seesaw chart if you take a look at it we saw gold rise this morning on -- as the euro rose. and then we saw some profit taking as we reached a bit of technical resistance above 1750 an ounce. traders though say they still see longer term, if things do turn around in europe, that that could likely be inflationary. there are also concerns longer term about what may happen between iran and europe and the u.s. they say there are a lot of calls for this summer that are looking for gold to rise once again. but today we're fol falling at the end of the day. silver falling along as well on technical resistance, but copper being the outliar on the day. if things do turn around in europe, we may see more demand. back to you guys. >> bertha, thank you very much. whole foods among the big names getting ready to report earnings after the bell.

today the stock up almost 10% so far this year and almost 45% over the past 12 months with rising prices and a tough economic climate, can that growth continue? jane wells is at a whole foods in glendale, california, to focus on the big issues investors need to know ahead of the whole foods numbers. jane. >> reporter: tyler, you know, whole foods has a history of surprising to the upside even in the economic downturn. and many analysts are expecting a beat today. some even expect management to raise guidance for the year. it's what i call the keen wau indicator. if you shop here, you know what i'm talking about. the street's looking for 60 cents a share with $3.9 billion in same store sales. piper jaffry points to costco is usually a good indicator for whole foods since there's a lot of crossover in their customer base. goldman sachs expects a beat and points to three issues. improving labor markets, strong earnings from food manufacturers and retailers and the first time i've seen this "benefits from

living social coupon." expects to see operating profit margins expand to 5.3%. that's in the face of food inflation. still a buy on the stock at goldman, it's taken off the list because share prices getting pricey. morgan stanley saying the same thing expecting management to raise guidance but "we are reluctant to chase shares at these levels." last year up well over 40% while the food retailers done much better than the broader market. >> thanks, jane. >> looks beautiful in california once again. focus on tobacco stocks seeing considerable strength on the day. earnings news from the big u.s. players. the dow jones and s&p trading up nearly 30% over the past year thanks in part to dividend yields and strong cash flow. but can the sector continue on the same path this year?

let's hear from bonnie herzog, nice to have you here. >> thanks for having me. >> what do you think is driving this particular group in a whole? i should note you have a perform or outperform on the various stocks within that sector. >> you know, a lot of what's driving the group is continued pricing power for the sector. what we're seeing in the u.s., although the volume continues to decline in terms of cigarette consumption, the industry's been able to offset those declines with pricing power. and internationally for phillip morris, that's our top pick. we still see a lot of growth and upside potential, specifically in asia where the company is able to generate positive volume. on top of that also get pricing. >> and i would assume that the dividend yield on some of these stock ss very attractive for those investors who want to be paid while they wait. >> yes. i mean, in the u.s. tobacco stocks you're looking at a 6% yield. it's still a good place to be for investors.

and then combining that with phillip morris international when we're looking for underlying or currency neutral eps growth anywhere from 10% to 12% for the next several years. you also have price appreciation, we think, in the stock price. >> so if phillip morris is your number one pick because of international exposure and growth potential, which stock would be your least favorite of the group? >> if i think about it, i'm more neutral on lor lard and altria group. this looming decision on the menthol issue that the fda is looking at. they're looking at the size and what that could mean for the public health. that's been a bit of an overhang. so i do think there's a negative risk/reward ratio in terms of owning that stock. that's something we're more cautious on heading into that decision. other than that the fundamentals appear quite strong. >> thank you very much. appreciate it. good to see you. ty. >> up next on "power lunch,"

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they go into power plants which take some form of energy, harness it, and turn it into more efficient electricity. [ ron ] when i was a kid i wanted to work with my hands, that was my thing. i really enjoy building turbines. it's nice to know that what you're building is gonna do something for the world. when people think of ge, they typically don't think about beer. a lot of people may not realize that the power needed to keep their budweiser cold and even to make their beer comes from turbines made right here. wait, so you guys make the beer? no, we make the power that makes the beer. so without you there'd be no bud? that's right. well, we like you. [ laughter ] ♪

coming up on "street signs," pulte homes up big this year. is it time to buy or bailout? the most widely held names in portfolios where you should stash your cash. and the rodney dangerfield why microsoft is getting no respect. that's next on "street signs." now back to sue and tyler on "power lunch." [ laughter ] >> i think we're going to brian shactman, aren't we? >> this whole brian, brian thing is not working. >> he's taller. we both talk a lot. kovn tri health but eps missed by 5 cents. they were a bit weak on the service side. apollo investment getting hit after an eps miss and bucking a

general trend down almost 9.5%. raised and went and filed for a secondary. still up 1.75%. tyler, over to you. >> now we are ready. like oil in the 20th century, investor ron lauder says water is going to be the number one essential commodity on which the 21st century will turn. and in response mr. lauder is right here on "power lunch" announcing the launch of a water and waste water treatment company, it actually already exists, serving the global middle market critically. ron, welcome. good to have you with us. >> thank you very much. people don't realize 97% of the water in the world is undrinkable. 1% is antarctic, one is arctic. only 1% of the water in the world is drinkable. and the fact is the population is growing, there's pollution, the water is getting scarcer and

scarcer. today people don't realize water is more expensive than oil. >> you're already in this business having bought a couple of companies. and you tend to add to this and to finance others in what you call the critical middle market. >> right. >> you say the big projects get taken care of. the smaller projects have no trouble raising capital, but the middle market -- and as we know there are water difficulties in the united states, in the developing world, all over the world. >> first of all, there's almost no middle market. the big companies have bought all the companies. the little companies don't have the money to finance. we're right in the middle. and it's a very special space. we bought three companies over the last 18 months. one in israel, one in america and one in italy. these three companies are small companies growing, but they're very powerful. >> wars have been fought over oil. i guess one fear that i might have both as a potential investor or as just a human being is whether you think wars

will be fought this century over water. >> wars have been fought for ages over water. when i was -- ten years ago when i was speaking with one leader in the middle east, he said to me, water will be peace. water will be war. to me, water is the key element. and what happens is that when you don't have water, you don't have a strong economy. and what happens now is water is in different places. an interesting thing, the big companies, for example, a desalization plant takes three to five years to build. we built one, smaller size, in cypress, in six months. six months is what it takes these big companies time just to get the plans ready. >> big companies like one of our co-owners, general electric, big in water treatment and infrastructure in china and elsewhere. we want to transition and talk about one of your other passions and that is fine art. mr. lauder has found great success in another alternative

area of investment. a couple years ago he paid $135 million for a painting that now hangs in the gallery in new york. i hope i did justice to the name. >> you are the few people who pronounce it correctly. >> good. i think that's because i've been there. the purchase was handled by christies and christies post war and head is here and brought into the conversation. welcome back. >> thank you. >> great to have you with us. >> great to be here. >> what is it about art that attracts you apart from the intrinsic value. why is it so hot today? >> first of all, i started off and i'm not an investor in art. i'm someone who has a passion for art. and i love art. but what i've also said is there are three levels of art. there's the oh, oh my, and the oh my god. you want to buy the oh my god. >> yeah. >> that has gone up dramatically. we see today the sales, it's either the big ticket item or

the small things. in the middle gets hurt. and paintings that i purchased many years ago for a very low amount -- >> the climpt was an oh my god? >> quite an oh my god. >> so if i ask you the same question, why is art attracting so much attention today? what is it that attracts not just the lovers of art, like ron, but the people who want to invest in it for gain? >> i think right now the art market's becoming ever more global and people see an ago eg regags. it was always quite cut by individual taste and now we have a real global taste across the board. that means the best and the brightest and smartest and the wealthiest are playing in that particular field. >> who's buying today? and how is that changing? where are most of your customers coming from? >> well, it would be wrong to say that, you know, the whole

market depends on -- wouldn't be very strong without america playing, wouldn't be strong without europe playing, but increasingly see buyers from russia, the middle east, parts of asia, parts of south america. >> china? >> china of course. >> you see them in the auction? >> absolutely. and we see a market right now that's extremely smart. even the newer buyers are very quick to learn, very quick to get good advice. we see a smart market. and also an absolutely robust even intrepid market. >> contemporary art, post war and contemporary, was very, very hot last year. asian art was very hot last year. do you see those trends continuing? you first then you. >> absolutely. they'll definitely continue. >> i agree 100%. but you use the word investing. people who look at art just as an investment lose. art is something you have to not only -- it's like investing in the stock market. there are many stocks. you have to know which ones --

you have to have a passion for it. and one of the things i've seen over and over again these people say it's easy, just put money in, the piece goes up. >> that's like a lot of things. i think if you try too hard to make money, that's probably not the reason to do it. you don't go into something to make money. you go into something like water, like art, because it's a passion. >> right. >> because you believe it in intrinsically. let's turn and talk to a couple big auction items you have coming up in the next few weeks. i'm going to ask you to talk a little bit about them beginning with a richter painting. >> fantastic. we have big sales next week in london. we have a superb abstract richter coming up. it's from the middle 90s his most sort of celebrated period for these abstracts that have become global icons, things the whole world wants. this will come up next week about $8 million to $12 million. >> and is this an oh, an oh my, or an oh my goodness -- oh my god?

>> somewhere between oh my and oh my good. >> somewhere between oh my and oh my god. okay. bacon. >> if he saw it in person, he'd be oe my god. >> this is the year after francis bacon had his breakthrough retro spect of the tape. he was really on top of his game. a stunning nude of a regular subject of his. this is a very rare nude and a very commanding one. >> 28 million there. >> this is an oh my god. >> and one more. very quickly. >> okay. coming on the screen with us. there we go. terrific work from 1955. absolutely classic in scale and sort of autumnal palette. you see him reaching for the forms that he perfects right in this period. >> oh, oh my, oh my god. >> i haven't seen it in real life. >> got to stand in front of these. >> if it is what i think it is, it's an oh my god also. >> it's an oh my god.

when i see bacon, i say oh my god. thank you very much. appreciate it. >> thank you. >> thank you very much. >> sue, back to you. >> thank you all. coming up next on "power lunch," group onnon gearing up. and caesar's off to a flying start. first day of trading up about 80% on the day. get in now, or buyer be ware? a roll of the dice perhaps. we're back in a moment. and all of a sudden, ka-plam. it blindsided us. what is it? our college savings account. how do you think it happened? not sure. i think something we bought a while ago turned out to be something else, annnnnd, i remember a lot of other stuff in there had the word "aggressive" in it. is everyone okay? well, now, yeah. who knows later. ♪ between taking insulin, testing my blood sugar. is this part of your life? freestyle lite test strips?

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all right. groupon getting ready to report its first-ever earnings report since going public. results are out after the bell. the stock is down just a little ahead of that report. but it's up more than 15% so far for the year. kayla tausche's here with what you need to know before those numbers come out. hi, kayla. >> hi, sue. well, you know, we're expecting a tight profit for groupon's first-ever public quarter. earnings expected by analysts to be 3 cents a share of $473 million in revenue as the company reversed pre-ipo losses by slashing its marketing expenses. for the full year, however, steep costs will eat into groupon's bottom line where analysts expect a loss of about 29 cents a share. the main concern from wall

street is can groupon continue rapidly acquiring customers without spending an arm and leg on marketing. citi group estimates active customer base grew 12% in the recent quarter versus 26% the previous quarter. definitely appears to be slowing if those are to be trusted. remember, growth was the buzz word for last year's internet ipos. the sole reason could be valued north of $13 billion. of course skeptics of that valuation have been stoked recently by facebook's prep for a giant ipo and living social coming out recently. >> let's turn to caesars. trading publicly and absolutely wild trading. bob pisani's following it. you're following. what's your take on what's going on with that? >> people have been asking why so many people at cnbc are following such a tiny ipo. some thought it would go straight down because six times more shares were going to be offloaded by investors than

offered in the ipo the others said it could cause it so skyrocket. what you're looking at right there is exactly what happened. take a look now up just about 57%. some observers are sounding alarms on this one. remember, the pricing was delayed due to regulatory questioning because the road show was a hurried three days. normally they're two weeks. regulators didn't really have enough time to answer a lot of questions that they had like who's actually selling, how long they had held the stock and what their motivations were. second, the retail component in this issue was bigger than most. usually a stock offering is about 80% institutional buyers, 20% retail. this one favored retail as a stretch to get to that 450-shareholder threshold to be able to list on the nasdaq. and the company's in a market with $100 billion in secured debt that would piggy back on today's performance. i say be ware of the ides of february.

>> i think you would be right. interesting it's a casino stock too. >> and we'll be watching tonight. [ overlapping speakers ] we'll see. >> thanks, kayla. >> coming up, two hours left in the trading day. on "power lunch," the question of the day, what is worrying you about this market? your responses when we return. but we couldn't simply repeat history. we had to create it. introducing the 2013 lexus gs, with leading-edge safety technology, like available blind spot monitor... [ tires screech ] ...night view... and heads-up display. [ engine revving ] the all-new 2013 lexus gs. there's no going back. tdd#: 1-800-345-2550 like a lot of things, the market has changed, tdd#: 1-800-345-2550 and your plans probably have too. tdd#: 1-800-345-2550 at charles schwab, we'll give you personalized recommendations tdd#: 1-800-345-2550 on how to reinvest that old 401(k).

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as we've seen many times tech a little leader here. s&p just slightly down. dow down 18 points. >> we've been asking you what's keeping you awake at night. i haven't slept much at night but had nothing to do with the markets. you have tweeted an e-mail. here are some of your responses. first up, i'm worrying that there's too much worry. sue. >> next, an e-mail from mj in dallas. they say most stocks are at 52-week highs or all-time highs in a very short time. the market is spinning at the top and needs to step back a bit. all the retail traders are chasing and they're the one who is will get hurt. >> and finally a tweet, oil $600 a month to keep my house marginally warm. help. >> yeah. the energy complex is going to be a problem. >> that would be a worry. >> thanks for your e-mails and