doc. >> apple already added $18 billion in market fat. just take some profits. >> keep an eye on the chemical. >> that does it for us. more fast tonight. follow me on twitter. power begins right now. thank you, scotty. three hours to go in the trading day and investors are taking a very close look at the big mortgage settlement. the five largest morgan stanley lenders reach a $26 billion deal with the states and the feds over foreclosure abuses. but what does it mean for the housing market and the bank sns and is it really fair to people who have kept up with their mortgages, simon? >> meantime market shrugging off the promise of a greek debt deal. and despite a 20% rise major indices since october, price-to-earnings ratios still off their average. why stocks are allegedly cheap. >> stealth thi stocks on the move. high-end jeans maker is one of them. should you buy the stock or just

buy a nice pair of blue jeans. i'm sue herera with simon hobbs and "power lunch" begins right now. risk on, risk off, greece on, greece off. markets yawn at the greek debt deal. did investors buy in the rumors and sell on news? could be. here's how the major averages stand right now. we're green across the board. second day in a row. the dow higher still a ways off 13,000. take a pulse of the markets. the euro back near a two-month high here 1329 around that point most of the day. our 10-year nicely higher at the highs of the day 2.07. and a mixture of greece and iran have oil ticking higher. you're still below that $100 a barrel mark. our midday movers, al ka may big mover today. rising 14%.

lor lard higher. "power lunch" highlighted that stock yesterday. and data storage company teradata up share price up more than 10.5%. there's a downside too. diamond foods way down. an accounting firm turned up improper payments. this puts their pringles deal in doubt. trick advisor getting crushed more than 16% after fourth quarter earnings came in light. outlook weaker than expected. and groupon sinking down more than 13%. sue, over to you. >> courtney, thank you so much. breaking news right now. $16 billion in 30-year bonds up for auction. rick santelli is tracking action at the cme. how is demand, rick? >> i'm still kind of handicapping it here. let's go through the metrics. if you look at the $16 billion fresh 30-years that we just auctioned, the wi market hovering at a 323 lot, so the bid and offer on yield was 3.23. it came in at 3.24.

higher yield, lower price. that's not a great thing. if you look at the bid-to-cover 10 auction average of 2.66, this one light at 2.47. granted we had a 2.40 in november. it's still on the light side. but the 30-year's had a wider range, actually, statistically on some of their bid-to-covers. maybe because of the twist. if you look at the indirects, they were light 33%. 10 auction average these were 29.2. you know, the more i look at this i just don't see how we could do much better than a c minus on this one. so we're going c minus. >> yikes. yikes. >> okay. >> that doesn't sound good. >> rick, thank you very much. rick santelli there in chicago. from chicago to new york and the trading floor at the new york stock exchange, bob, how are we looking? >> most traders say we've been fairly flat this week, but in fact there are some clear winners and losers. look at the major sectors for the week. there's been one big winner this

year, and that's technology stocks. every week most of the time you're getting technology as the big leader. and that's the case again this week with some of the big sectors. there's tech up 2.1%. energy also strong. notice financials and materials are weak? that's interesting because those were the two market leaders on the year. those are the weak group this week. so a little bit of rotation going on. other than that, another new high on the nasdaq. of course we're getting essentially an 11-year high now there and week after week that thing is powering forward. elsewhere, the main groups today big movers, home building stocks. right across the board likely having to do a bit with the housing settlement. diana will give us details on that. back to you. >> indeed she is. right now, perfect segway, bob. thanks. let's switch on the "power lunch" power surge and drill down on the stories driving the day. we start with that big housing settlement between the nation's banks and the states attorneys general. the president making remarks on that deal within the last hour. diana olick has been all the over the story from the very beginning. we have a deal, diana, but

there's still a lot of unanswered questions including the issue of fairness. >> yeah. trust me, that fairness issue is going to go on for quite a while. in fact, it's on my blog today. just a little plug. but, look, this is a $25 billion deal that could rise to as much as $40 billion in relief to borrowers if other servicers sign on. up to nine other servicers are currently in negotiations. that's the largest government industry settlement in history, way beyond big tobacco. >> that's what today's settleme settlement's all about. standing up for the american people, holding those two broke the law accountable, restoring confidence in our housing market and our financial sector, getting things moving. and we're going to keep on at it until everyone shares in america's comeback. >> all right. let's run down the facts, shall we? 49 states signed on. oklahoma the lone holdout. bank of america, jpmorgan chase, citi group, ally financial and wells fargo in for the $25 billion. $5 billion to federal and state

governments. $1.5 billion of that to payouts to borrowers whose homes were foreclosed on. other go to public funds after the so-called robo signing misconduct and legal aid and counselling. $20 billion go towards mortgage relief. half of that to principal writedown for close to a million borrowers delinquent on their loans. $3 billion to those current but under water on their loans. the rest to refis, principle forebearance, short sales and all kinds of other assistance. the servicers must fulfill these requirements in three years. and of course we will be watching, sue. >> indeed, diana. what about the banks themselves? they were stronger earlier in the morning. in general, how are they reacting? >> well, the banks -- my interest in the reactions was less on the stock side and more on what they were saying. bank of america put out a statement today saying they believe this settlement brings more certainty to the housing market and aligns our commitment to get the housing market back

on track. and that is the key issue in this settlement for the bank. they've been stuck on foreclosures and not able to move them through the pipeline. this settlement puts that behind them and allows them to move forward with foreclosures and that's the one thing that will clear the housing market of all the distress. sue. >> thanks, diana. another big piece of news out of washington. the house overwhelming voted to pass a bill but imposes new regulations on washington insiders who collect the information from lawmakers and sell it to wall street. the senate version included that proposal. house and senate member wills now hammer out their versions before sending the legislation to the president to sign. simon. as we speak, the finance ministers of the eurozone are meeting in brussels. it's clear from the comments they've made on the way in there is not a deal, as we speak, on greece. let's go live to athens and to our reporter on the ground. julia, the story early on was

that the greek finance minister and prime minister had done a deal with the staff on the troika. what do they think they're taking into that meeting? >> finally we have an agreement on the proposals between the coalition leaders. they couldn't agree on pension cuts and now they have a statement from the prime minister saying they have at least agreed amongst themselves on a deal. obviously there's no details come out so far. what we've heard is only speculation that there will be no pension cuts, but then sources on the ground here saying that there will be pension cuts. there might be partial pension cuts. very little details. 22% cuts in the minimum wage here. unemployment benefits also seeing a corresponding for the two largest unions here in greece have announced they're going to strike again, a 48-hour strike. there's also a rally on sunday.

a very tough couple days here in greece. in terms of next steps, you mentioned it, we're awaiting the euro group, any announcement there on whether they will sign-off on this deal. going forward then we have to look at the deadline for the final deal. >> sure. >> the final draft on that is the february 15th. so we're approaching that. at the same time the parliament here has to agree, has to vote, on these reform measures. they also have to vote then afterwards on the implementation of these reform measures. we also had from the ecb today they remain very tight-lipped on whether there will be any official sector participation. so step one complete, but as you point out, we've still got a long way to go. >> okay. >> sue, back to you. >> thank you very much, julia. so from what julia outlined, simon, miles to go before we sleep. there are a lot of hurdles left. >> totally. there are some big issues to hammer out in brussels tonight. and then you've got to take it back to the greek people in advance of the election will they vote it through parliament

to the satisfaction of everybody that they release the cash. this is the beginning of a new chapter in the process. it's not solved. >> are you optimistic though? we're inching towards perhaps a resolution of this or not? >> the market assumes -- and that's what really matters. >> exactly. >> the market assumes we will get the payment from the rest of europe on march 20th and there will not be a disorderly defalt. after that all bets are off. for the moment -- that's why the market hasn't moved a huge amount today. but we could get upset. if that meeting breaks up badly in brussels, we could really have some trouble. >> all right. thank you, simon. >> let's move on. pepsi losing its fizz with investors right now. the company beat profit estimates, but it's lowering its outlook for the year and slashing jobs. bertha coombs is live at the pepsi analyst meeting with the very latest in new york. bertha. >> thanks very much, simon. addressing investors today, she said, i know there are things we could have done better and wish

we'd done better over the last five years, but between the financial crisis, integrating the pepsi bottling merger and also the problem with the commodities spike, she said she just didn't have enough visibility. but she's making changes now. 2012 is going to be a very big transition year for the company. and the main focus is going to be on the company's core brands. they have lost market share here in beverages in north america and they are going to reverse that this year. they say they're going to focus on core pepsi, gatorade, those big iconic brands. they're going to streamline operations. and they are also going to try to streamline the marketing and make it global. it is going to impact earnings. they're going to take a hit as the company is going to spend more to promote those brands. they're going to boost between $500 million and $600 million. they hope to generate $1.5 billion and going to result in

8,700 global job cuts. they say the pain will be less here in the u.s. than globally. it will not involve splitting up food and beverage. the synergies for both are worth nearly $1 billion together. >> the two businesses depend on each other to grow. i tell you we cannot have a successful snack business unless we have the business market scale. >> another thing she talked about is if i'd offered maybe less aggressive guidance at times, that might have helped the share price. she's doing that now in lowering the guidance, but they're also boosting the dividend. shares are down today, but they hope this will help show the street and show investors that they are on the right path to a turnaround. back to you. >> bertha, thank you very much. so, what are you all following today? we want to know your pick for chart of the day. you can e-mail us. send us a power tweet.

and send us your top pick. and we'll put the best of the best on the air later today. up next though, stocks on a bull run since october. they are up considerably depending on which measure you look at. certainly more than 20%. but the p/e on the s&p 500 still below the long-term average. so despite the big upside move, are stocks in the u.s. still cheap? >> and as we head to break, let's check on the sectors. market relatively static, but apple having a record day. >> again. >> consumer staples higher. on the downside, utilities, telecom, a more aggressive rotation. [ male announcer ] what if you had thermal night-vision goggles,

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lastly, a laggard here at the nasdaq. that's groupon. their lack of profitability a huge concern for investors. if you take a look at their income statement, marketing cost as a percentage of revenue hit 31%, which is very high. to get some perspective, amazon

and netflix are around 5% to 10%. that's what groupon has to aim for. sue. >> thank you very much. u.s. markets surging since the october low of 2011 with the dow, nasdaq and s&p higher by more than 20%. despite this huge move, billionaire investor ron baron said on "squawk box" this morning that stocks are still cheap. >> the way i see it because of all these concerns that everyone has, everyone's afraid. they're afraid to invest. and because they're afraid to invest, stocks are at the lowest level, most attractive level, in my lifetime. >> that's a pretty bold statement. is he right? let's bring in mike finnegan, chief investment officer at principle funds and chief investment strategist at pncwet management. bill, i'm going to start with you. do you agree with that statement? >> i'm not sure how long he's been around, i'm not sure i go that far. certainly a lot of measures in terms of interest rates relative

to inflation, all those different things, they certainly show up as attractive. i think certainly attractive relative to the bond side of the world. >> and, mike, would you agree with that? and what about the volatility component? >> yeah, i think i would agree with that. when we sort of -- if you think about the valuation of the market, a couple measures, the p/e of the market still sort of low single -- i'm sorry. 10 to 12 sort of range. another thing we focus on is really what the equity risk premium looks like. and if you look at it today at about 6%, that's pretty rich, which is really a good positive signal for folks to think about entering the equity market. on the volatility side, yeah, i think our forecast is that the -- overall pretty bullish on the market. it's just going to be a bit of a bumpy ride. >> yeah, bill, what are we actually saying here? when we say, look, we're trading at a lower multiple at the moment, we basically mean that the market is charging less for given income stream -- future income stream, over time.

that doesn't make it less expensive than we had before. it just makes it different from what we had before. there's no guide, surely, bill, that we will actually climb back to the multiples that we had before particularly as people will realize that the stock market has gone nowhere for a decade. that higher multiple led us nowhere. >> you're right. >> it's true. >> right, but here's the way i think about it. and i think it's a simple and good way to think about it in terms of the s&p. right now you can buy a 10-year treasury and earn -- round it for ease, about 2%, right? >> uh-huh. >> right now you can buy the s&p 500 index and earn 2% roughly on dividends. over history they've grown those dividends. and obviously we all know over history the capital gains have also been good. just throw that out and automatically i even win if we hold steady and grow dividends over time. i think that gives you that long-term perspective that if you do believe over the long run economic growth will continue, that you're going to feel pretty good in stocks over a given

period. >> mike, you talk about risk premium and how you invest. where are you putting your money right now? i know you've been bullish on reits. are you still? >> we consider reed's to be fairly valued. the big value behind them is employment growth. the way we invest in global diversified income fund, we're looking at yield but we're also looking at risk. and when you look at the global reits, there are clearly parts of the world where there are very nice dividends with risk we think we can manage particularly in the u.s. we tend to have an overweight on the u.s. read market. we're sort of equal weight in australia and light in europe given some of the concerns about economic growth and employment growth in europe. yeah, we like reads. >> thank you gem. appreciate it very much. >> thanks. >> up next on the program, we'll find out the answer to the

question that everybody's asking this thursday lunchtime. what is wapner watching? >> indeed. plus, sirius xm out with earnings, linkedin and act vision report after the bell. are these stocks hot or not? stick around and find out. ant t. right. but... home security systems can be really expensive. so to save money, we actually just adopted a rescue panther. i think i'm goin-... shhh! we find that we don't need to sleep that much. there's an easier way to save.

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♪ lelts check in with scott wapner and see what stocks are on his radar this hour. >> hi, sue, with apple moving closer to $500 a share, i thought we'd look at the halo and that's nuance communications. nuan, the stock up about 3.5%. ahead of earnings after the bell. this is the company that does the voice recognition software. a lot of optimism about ipad 3 coming pretty soon. maybe an apple tv product as well. maybe something could also contain nuance communication and sere ri as well. wall street continues to raise the price target on the stock. again, earnings after the bell today. and with apple on the move yet again, the halo-effect is on for nuance. simon. >> are we suggesting that the

new ipad 3 you could talk to it. >> nothing would surprise me at this point. would it surprise you? >> not at all. thanks, scott, you know it's a busy day on the earnings calendar. big names reporting, sirius xm and activision among them. missing on the top line, what do investors need to know? julia boorstin joins us live from los angeles along with with cnbc.com's john carney. let's begin with sirius. do you think it's hot or not? >> i think not so hot, simon. i mean, this company projected much lower than projected subscriber growth for 2012 despite the fact we're expecting some good auto sales. the company raised prices for the first time. and that drove some subscriber losses. and i think they're going to be facing increased competition from pandora. >> hot or not, john kacarney. >> i said not as well. the low growth subscribers is troubling for the company at this stage.

they should be able to boom and move ahead especially with car sales picking up. and they don't see that happening. so neither do i. >> switch to linkedin. julia, what do you think? this one hotter than sirius? >> i think this is hot. linkedin reporting after the bell i think it's going to benefit from the jobs market picking up. two-thirds of revenue -- more than two-thirds of its revenue from company payments. a lot of that is recruiting. linkedin will benefit from a hotter job market and the fact it's stealing market share in the recruiting business. people are just moving more to recruiting business online and linkedin will benefit from that. >> what do you think, mr. carney? >> absolutely hot. i've talk today recruiters particularly in the financial sector. and they say that linkedin is now the number one place that people are looking for new employees. so as the economy keeps building up jobs, linkedin will really benefit from that. it's now everybody's online resume. we're not going to have resumes in the future. we'll have linkedin pages. >> they're able to make money from that?

>> they are. they charge employers to do it through their service. they can make money from that. >> one more at you, julia, activision, hot or not? >> i'm giving it a hot with a caveat. this is a hot company we saw its modern warfare 3 was a record setting video game. biggest entertainment launch ever. we'll see how big those numbers really are. the real question here is going to be the world of war craft numbers. we'll have to see how many people are still playing this game. that's going to indicate what the company's next quarter will look like. but for now i'm giving it a hot. >> okay. john, you know your way around a game console well. >> i do. and this is a not. yes, they have the hottest game around right now, but world of war craft is a really old game. it doesn't have the buzz it used to have. and i think they're going to be losing a lot of subscribers to competition from ea and others.

>> guys, thank you very much. julia and john, hot or not. thank you. >> don't look now, but silver is up more than 20% this year. can its stealth surge continue? we'll talk about that. >> and some under the radar stocks that are on fire. shares of premium jeans maker up 70% last year. their clothes are hot, but should investors continue to believe in true religion? we're back in a flash. tdd#: 1-800-345-2550 like a lot of things, the market has changed,

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welcome back to "power lunch." look at the major averages. we're in the green all the way across the board. we've been on both sides of the flatline. nasdaq fairing the best of the bunch. vix is actually higher today 1.2% but still underneath that 19-mark. oil prices, wti crude flirting with $100 but just below that point right now. gold higher, dollar a little weaker and the 10-year up above 2% for the yield. let's look at the winners and losers today of the s&p 500. acamai still higher. trip advisor, the worst of the bunch, down more than 13% after those earnings. let's get a quick check on what's going on with metals. they're closing right now.

sharon epperson for us at the nymex. >> courtney, we are looking at gold and silver prices. that final trade coming in right now with gold right around 1740 an ounce and silver just above that $34 level. keep in mind though we've given up quite a bit of the gains as the euros come off of its highs. we've seen the metals do the same. of course a lot of traders still looking at what potential shoe could drop in europe may be and also waiting to see what is next in terms of u.s. economic data. i'm joined now by lou grasso. we are looking at silver prices that are the best performing commodity year-to-date up over 20%. why is there so much momentum in silver? >> silver really got trashed at the end of the year. it sold off from a high of about $35, $36, got pounded down to $26. silver's been a great performer year in and year out. so i think what happened is money just rushed back into it. i think it might have gotten a little bit ahead of itself right now. i do expect silver to probably

go and test $37, $38 some time by mid-year. but i think we're poised for a bit of a pullback down to $32. >> do you think what is rising gold prices whether it's the euro or what we're seeing in terms of the greek debt deal, is that also driving silver prices? or are there some other fundamental factors with silver? >> silver does have a lot of fundamentals. a lot of industrial demand. there's a supply of about 750 tons of silver every year. and when you look at that and most of that is taking up by industrial production, jewelry demand and then you have the investment demand. it's still a very small part of demand for jewelry. that's starting to grow. and i think that is the same thing why the investment demand for gold and silver's the same. that's what's going to be the driver in the future. >> and tomorrow, quickly, in terms of the silver trade now that we've had the close? >> tomorrow, i think if we don't get above this $34.45, which is today's high. we've tested that level a few

times. if we don't get above it and stay above it, i think we go to $32.25. >> there you have it for lou grasso. back to you in the studio. >> thank you very much. you're going to need a lot of silver and gold to buy these next pieces of apparel. true religion apparel is a company that might be off your radar but shares hitting a fresh 52-week high just yesterday. and they surged 70% during that time. the premium denim brand is set to report fourth quarter results after the closing bell today. joining us to get ahead of those numbers is specialty retail analyst with needham and company. and of course also with us is cnbc's courtney reagan. she covers the retail beat for us. christine, let me start with you. you like the stock, certainly. but what do you want to see in terms of top and bottom line growth today. >> well, i'm certainly expecting at least 20% growth on the top line. we're looking for at least 71 cents. that's 2 cents above what the company had guided we think that the company can do north of that. and for the outlook as per is

company policy, they'll start off conservative but should be able to reach 20% growth eps for 2012. the brands is hot. >> and they have international exposure as well with china and hong kong and some exclusive agreements there, correct? >> they just signed a new joint venture last quarter. so they are going into those markets. europe, the good parts of europe like germany has been a big market for them and strength continues there. higher margin in the u.s. is about 20% of their business with the u.s. retail about 60%. >> courtney, weigh in here. what do you hear? there's obviously a lot of buzz about this brand. they have pricing power. the jeans are expensive, north of $400 a pair in some cases. interesting that it still works in this environment. >> it is. and i think that this is one of those companies that it's consumers feel better when the stock market is doing better as opposed to the macro economic environment, sure, that's important. but these are the higher end consumers. they pay a little bit more attention to what's going on

with their investments. they're not as worried about what's going on say in the labor market. that being said, there are some things to watch out for. i know that international is a very strong growth factor, but the united states is still very important. and those wholesale sales, the second biggest segment and they've fallen for 11 straight quarters. so i'm going to watch for that today in the release. >> what about that, christine? do you want to weigh in on that? >> it's interesting. i think the investors are overly focused on that wholesale decline. what's happened is true religion has built their own retail stores. they're actually taking share. if the brand were not still hot, then they wouldn't be able to comp double digits at their own retail stoeres. the product is higher priced at their own stores. very little overlap, probably 10%. and i think the premium customer's going to true religion stores, not department stores for jeans. >> what would change your mind? >> i think if comp started

turning negative at their own stores, that would say to me the brand has lost relevance with the customer, but i don't see that happening. the comps have held in there despite the recession. i think it will continue all year. >> i've never owned the jeans but i'm assuming at $400 they're very comfortable, one would assume. >> they are comfortable. >> all right. she attests to that. thanks, christine. thanks, courtney. as valentine's day approaches, we turn to the business of online dating. now a $2 billion a year industry. in our documentary we talk to a chief strategist at match.com about the science behind the perfect match. >> the match formula takes into account something called difference. the difference between what we say we prefer and what we actually pick when given a choice. it did that for lisa. >> she was looking for someone, if i remember correctly, between the ages 32 to 35. and he is 38. so that's where the algorithm

kicked in. she had shown interest in four mens older than 35. >> they're used by many sites. at match, analysts study their subscriber's personalities and preferences. continually refining a model that predicts who will click with whom. >> is there a scientific formula for love? >> i don't think there's a -- i guess i don't have one. but we do have a pretty scientific formula for like. >> interesting to say the least. tune in to cnbc's original documentary "love at first byte." the secret science of online dating tonight at 9:00 p.m. eastern and pacific. >> you can always google the other one, you don't know where you'd end up. >> absolutely. >> next on "power lunch," a housing settlement between the big house and states impact the

mid size banks. we'll talk to the ceo of city national. and another sign of times from the once mighty kodak. the camera that bought cameras to the masses many decades ago saying today it's getting out of digital. back in two. (

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coming up on "street signs," it could be the beginning of america's nuclear revival. first on cnbc the ceo who wants to build the first nuclear power plant in over 30 years. is now the time? and a stunning announcement from kodak. they have investors really scratching their heads. and a look under the radar, little known stocks doing big business. that's all next in about 20 minute's time. now hand you back to sue and simon on "power lunch." >> we'll see you too. thanks. let's get to the trading floors and find out what's moving. bob pisani joins us once again from the nyse. >> one big market leader. it's this day, it's this week, it's this year and that's the technology group. look at how the major sectors

are doing on the week. tech the big leadership stock group. energy up a little bit. financials and materials were the leaders for the year going into this week, but they've kind of pulled back a little bit of rotation going on. people are very excited about technology stocks. techs are on fire. be a little careful about this. there's the s&p technology index up about 12%. the key point here is that apple is a huge way to get any technology index. in fact, it's about 15% of the nasdaq 100. and it's apple that is dragging all of these tech indexes to the upside. one trader said that overall earnings for the tech group would be negative if it wasn't for apple. there's apple, of course, up something like 20% on the year. that's a very important consideration. finally, on the home builders i keep getting asked about that. there was some hope that many mortgage settlement might free up lenders, make them more willing to lend. there's a little bit of a pass through to the home builders, kb home completed a recent deal with a debt swap as well. >> thanks, bob.

see you late sgler within about the last hour president obama addressed the nation on that $26 billion settlement with the five of the nation's biggest banks over foreclosure practices. how will this impact the banking industry? joining us now for an exclusive interview is chairman and chief executive officer of city national bank. he's also chairman of the mid-sized bank coalition of america. welcome to the bram, sir. thank you for sparing the time. >> great to be with you, simon. >> now, we should note obviously a, you're very joined to this trade group. so you know what your rivals and contemporaries will think of the market at the moment. you are not in mortgages yourself, you're also of course very focused on the west coast of america and a lot of the talk at the obama news conference was about exactly that and how the settlement will impact things there. what is your take? >> well, simon, i think there are a lot of things about this settlement that are good news. first, i'm delighted it's going to help a lot of american

families stay in their homes. i think it's also going to help as our country tries to work through this glut of housing that the bubble created, this is going to keep a bunch of houses out of foreclosure and help the inventories and help us move through this problem. it's also city national as you know is based primarily in california. this is good news for california. the estimate is something like $18 billion will flow into our economy, which is already picking up and doing nicely. also helps nevada, where we're located as well. but i think the big thing that it points out to me is that it shines a light on the difference between mid-sized banks like city national. by the way, city national does do a lot of mortgages for private banking complia ining c. so do other mid size banked. but we didn't do the practices being censured by this settlement. so i think it shows once again there's a real distinction to be made between the biggest banks, the banks that are settling this multi-billion dollar litigation today, and mid-sized banks like

city national that didn't do the subprime mortgages or ro bo signing. and i think that's what you've seen over the last couple years, the fact that there are mid-sized banks like city national presents an attractive alternative to the biggest banks like the ones that are settling today. that's helped mid-sized banks. >> mr. goldsmith, can you help me understand one thing? i ask the question because i find it fascinating to see so many people so angry about the unfairness of this settlement. in their view those that perhaps have not kept up their commitments to their banks and mortgage holders in a sense being rewarded for that when those that have done what is right and made sacrifices -- a sense of getting penalized, they don't get so much from this. >> well, you know, you're raising a really important and i think difficult question. and just like i think there has to be a distinction between mid-sized banks like city national that didn't do robo

signing, didn't do subprime, there should be a distinction made between decent americans who bought a house and made the payments and need some help because they got caught up in an ugly bubble. and there were borrowers who falsified their income and overleveraged. my hope would be and we're not involved in this settlement, so i don't know, but my hope would be that you'll see as they parcel out this money that they will make a distinction between honest borrowers and those who falsified documents. if people falsified their income, they shouldn't get a break from this settlement. >> you're in the sweet spot of banking, as you point out. you not only deal with a lot of high net worth individuals in private banking, but you also do a lot of funding for entrepreneurs and those either invested in hollywood in some way, shape or form, and or the entertainment industry in new york via broadway. if you look past that though, how does the state of the economy look to you from your vantage point? how much is the economy improving? >> you know, sue, i think we're

seeing some real positive signs. not robust, but, you know, look at california. you were just talking about apple and technology. city national's got ten offices in the san francisco bay area. so we see that part of the economy technology is booming. international trade through our ports is very strong with asia. agriculture is very strong in california. we've seen some pickup in nevada. so i think not only entertainment, biotech is strong in southern california. manufacturing, professional services, a lot of the industries that city national specializes in, we're seeing some improvement. gdp's, you know, 2%, 2.5% is our outlook for 2012. that's encouraging, confidence is building. it's not out of control. it's not giddy. but, you know, you guys have been reporting on the unemployment claims number coming down, unemployment coming down a bit. so i think we're seeing some steady progress. and if europe and iran don't

blow up, i think we should have a pretty good year assuming that the payroll tax cut gets continued. >> okay. thank you mr. goldsmith. >> thank you. >> good to have you here. ceo of city national bank. up next, an under the radar stock music to investors ears right now up more than 25% this year. >> i just stuck a high profile here how paul mccartny thinks that's going to drive growth.  oh! [ baby crying ] ♪ what started as a whisper ♪ every day, millions of people choose to do the right thing. ♪ slowly turned to a scream ♪ there's an insurance company that does that, too. liberty mutual insurance.

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well, stocks have been steadily marching higher with major averages up almost 20% since the october lows. nasdaq up 11% this year. the dow getting closer to the 14,000 mark. and all day on cnbc we're looking for high-flying stocks flying a bit under the radar, like this one. harmon international up almost 30% in 2012. and today the audio equipment maker marks biggest partnership ever with paul mccartny.

nice to have you here. >> good to be on your show. thank you. >> what does a partnership like this mean to your bottom line with sir paul mccartney. >> i think it's going to help our business, but has more to do with connecting two very authentic brands. paul is a great brand and jlb is a terrific american iconic brand worldwide. and i think when you add this this is going to create explosive interest out there in the market. and this is global. that's what i'm very excited about it. >> and you're trying to take it outside of the professional musician and more to the everyday person who wants to listen to music in a different way perhaps play music in a different way with the same type of equipment "the pros use" correct? >> that's something we have recognized by doing some market research and listening to the automotive customers worldwide, particularly german car

companies who we supply branded aud audio systems. they think the consumers in europe, america, asia and particularly new emerging markets get very excited when they find out that people like paul, sinatra, quincy jones, michael jackson, they've all been using for their entire career brands like harman. the likelihood for them to make a buying decision is a lot higher than any other brand. >> the automotive sector that would work to go back to the classic retro appeal of the brand. but it's very unusual to try and sell consumer electronics to people on the streets on the basis of that retro or classic approach. are you sure that the one size will fit all, if you like? >> you're absolutely right. it generally doesn't, but i think in this case paul represents multiple generations, but besides paul, i must add we have also signed maroon 5.

and he will be performing in the grammys. and we've also signed jennifer lopez. and we're going after the grammy award winner in china. the idea is to have people authentic in what they feel and do associate them with harman brands. >> you're the official partner of the grammys, which of course are coming up. talk to me about that. and also how much of your growth do you expect to get from the emerging markets versus the domestic markets. >> grammys -- we've been associated with the grammys for nearly ten years. what does that mean? the entire staples center is end-to-end done by harman sound systems from processing to amplification to what have you. we're very proud of that association. again, a terrific name. and worldwide it gets televised and we're very happy to be partners. when you talk about emerging markets, this has been a fast-growing sector for us.

as of this last quarter we announced this week we grew 44% in big countries led by china in that factor. and last year we grew similar amount about 45%, 50%. just five years ago we were nearly 2% of our global sales came from big countries. and as of today we're nearly 15% to 20% from big countries. the rest are phenomenal growth and we're very happy and very profitable growth. >> thank you very much. best of luck. we appreciate it. >> thank you so much. and please enjoy and watch the grammys live this sunday evening. >> we will. >> we will watch and listen. and something tells me it will be through harman equipment. appreciate it. all right. speaking of under the radar -- thank you, john. check out the back pages of these two newspapers. we have "the post" i'm doing it here. lin your face.

this is a post. lining streak. all right. that is because of the emerging new york knicks star jeremy lin. he did it again. red hot lin scored 23 points and ten assists last night, simon. including a very nice dunk. there it is. to help the knicks beat the washington wizards. the undrafted harvard economics graduate has now scored 76 points in just three games. he's on his way to becoming a fan favorite and a national phenomenon. >> good work. >> are you a basketball fan? >> no, but i'm learning. slowly. >> i have a learning curve on that as well. >> coming up on the program, just over two hours left in the trading day. our charts of the day and one viewer's choice of charts of the day. "power lunch" is back in two. ce 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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today on "street signs," they're ready to build the first nuclear power plant in over 30 years. is now the time to say yes to nukes? >> all right. it's time for top of the charts. i picked the gold market for my chart of the day. that is because bill o'neal sent me a note. he's bullish on that metal. >> and the viewers chart, we call it the power tweet. they say i'm watching xhb on the new deal