in the u.s. on monday, it's going to be a very interesting trading day on tuesday. >> have a great break, sue. >> thank you, see you in a week. >> that will do it for "power lunch." >> "street signs" begins right now. and welcome to "street signs." i'm brian sullivan. it's not quite friday the 13,000 yet, but the dow looks like it's headed back there. before you do a victory dance, we are going to show you some of the spooky similarities between this market and the last two big runs and drops. big tech a big part of this market run. some of the biggest names rising from the ashes like a phoenix. but on microsoft, cisco and others set to fall back to earth. and i think we can forget the big boys for a minute. it's stock screener friday on "street signs." we have five mid cap names, low p/es and no debt. those names ahead, mandy. >> indeed they are. good afternoon, everybody. i'm mandy drury. happy friday. the house and the senate get it

done two weeks ahead of the deadline. they've passed an extension of the payroll tax cut through the end of the year. the measure now goes to president obama for his signature. meantime, u.p.s. is trying for a $6.7 billion acquisition. the company botched by tnt express but discussions are still going on. and fresh from the collapse of a deutsche deal, sources say nyse next is among those to put in a bid to buy lme exchange. cme group also among bidders. >> we've been on a great run lately, but since it's almost friday the 13-k, we want to look at spooky similarities between this market and two other big runs and drops in the past. the s&p 500 hit a high of about 1552 in march of 2000. then got crushed as the tech bubble burst losing 50% of its value in about 19 months to bottom out at the time at 768

back in october of 2002. we then began an exactly five-year march higher. breaking to a new intraday high of 1578 back in october of 2007. then you know, folks, the bottom fell out again. the financial crisis hit. sent us down 57% in just 15 months to the rather ominous 666. that was our intraday low mark back in march of 2009. now this run. we are nearly three years into this bull market run. we have more than doubled from that intraday low, but i'm trying to point out, folks, look at how similar maybe these two pops and then these two drops are. and the trillion dollar question is, is this going to be puller geist 3? mark and steven joining us now. steven, how much concern do you

have that when this run is done, whenever it is, it could end in another 50% haircut like the past two. >> well, i think it depends on what the fundamentals are. i think the battle of the atlantic is on. on this side of the atlantic we have an improving economy. it's not robust by any stretch of the imagination, but improving measurably. you've also got corporate profits continuing to surprise to the upside. on those days when the markets have the fundamentals and valuations, the luxury to price those in, they tend to be up. we also understand europe will be a source of risk. i believe the likelihood we'll get a leverage bubble likely to collapse this market in the near-term is probably relatively low. >> greece and those headlines on a daily basis continue to disappoint but don't surprise or shock anybody. mark, i have to ask you, you're adding to your cash position. are you getting spooked out at these levels? >> yes. out of the box my commentary goes to somewhat more than 5,000

institutions and i've advised them to add to their cash positions and to be very cautious going into monday's financial ministers meeting in europe. >> why is that? i mean, do we really expect anything to come out of monday? no one would be particularly shocked if there was no progress on that front. >> the problem is you're running into the march 20 date where greece either has to pay its debt or not. the most disturbing news today, as far as i was concerned, was when the ecb swapped their bonds with greece for bonds avoiding the collective action clause, which is just the abrogation of the rule of law and institutional bond owners furious, one of the biggest in the world called it financial oppression. >> mark's making a good point, but a very technical point about the bonds and cac clause. the reality is we've had a three-year run -- i don't mean that insultingly.

>> no, no. >> the katie cunningham's of the world who are retail investors in anderson, indiana, whatever it might be, they're looking at headlines, greece, they're kind of freaked out but not sure how it impacts but see a market that's doubled off its lows and thinking maybe i should get back in here. how do we sell it to the retail investor despite what mark talked about? >> i think his cautions are well advised. greece disappointed everybody buzz surpri but surprised no one. going to be a johnny come lately to the parties. a well diversified portfolio in through the 50% drops we're up 25% from the september and october lows of last year. >> how much of that is a default rally? by that i mean there's really nowhere else to put your money. >> that's one of those options as well. in australia you can get 5% or 6% just for being in cash. for most of us around the world, you can't do that. globally diversified portfolios you're going to need a lot of discipline. and the average investor's going to have to look in those long-term portfolios. >> let's create value for the average investor out there,

mark. let's dig down to the individual sectors. you are saying that there is clear and present danger in the financials. what are you seeing there? i know they've lost some of the steam they were gathering at the beginning of the year. what's going on? >> what's going on is if europe explodes or if europe ends in very serious problems. remember, the equity markets rallying on some extent that there will be some sort of positive out of greece. i don't agree with that, but it sets off and triggers any number of things such as the cds markets and so forth so that you have to just be cautious going into this, in my opinion. in terms of all that happening, the european banks, obviously, are tied in with the american banks. so you have to be cautious in terms of counterparty risk and the fallout or the contagion that could come from european financial crisis. >> and i do agree with that, but i would say a game changing event has been that the europeans said they would never

do an american t.a.r.p., but they call it ltro, a lot of that has been diminished. i think from our perspective europe can upgrade from a crisis to chronic condition. >> stephen -- >> they've done a great service. >> if the market is as mark suggested that pricing in the fact that greece will not default, right, what if they do? >> well, it depends on what kind of default it's going to be. is it going to be sloppy or more orderly? the european central bank has purchased a lot of time, at least three years in our opinion, for the politicians to get basic blueprint for how to unwind greece and not have it hit italy and -- >> will we then hit a new high on the s&p 500 before this is over? >> i would rather look at the russell 1000 but i think that could be the case. >> look at commentary, a lot want greece out of the way, either default or leave the eurozone, whatever. maybe after a short and painful

disruption in the market, maybe there would be relief. is that possible, mark? >> that's certainly possible. as a matter of fact, it may even be in greece's best interest to default, go back and have the cheapest tourism and so forth over there. the problem is that once you hit default, it sets off five or six significant items that then have to be dealt with. also with the ltro i absolutely agree it's helped with the liquidity issues, but it has not solved the solvency issues and you're looking at portugal in front of us. you're looking at the elections in france in front of us that could also be problematic. >> sounds like you think then greece will default. >> i think the odds are probably about 70% that greece will default. we can't kick it down the road. they have to pay the coupon payment to the bondholders march 20. >> feels like we're kind of sitting on the cliff here right? it may or may not.

we don't really know what's going to happen on monday or further town the line. how do you invest, bottom line it for us, what the investor should be doing? >> we like the u.s. equity market. you look at the u.s. equity space. build your way up and start moving globally. cha n china's going to have a landing, we think softer than harder. cautious buildup. >> mark, your bottom line and what the retail investor should do riegtd now. >> my bottom line for the reftal investors to be cautious. europe could explode. we could have a financial crisis there and have symptom cash to get ready to play any drop in the markets both equity and debt. >> steve and mark, thank you very much for joining us. and enjoy your long weekend. >> thank you. >> could oil be a rally killer? well, brent is at an eight-month high and crude is at a seven-week high. bertha coombs is at the nymex and has been digging.

what have you found? >> reporter: we've seen support level because of the concerns about supply disruptions in europe should tensions with iran continue to similmer and boil over. for the week we have crude looking to close around $103 a barrel range. it is up a good nearly 5% for the week. gasoline is up about 1.5% for the week. year-to-date it's up nearly 13%. part of the issue there has been some refinery closures. we took a look at what we've seen historically for prices. we are at the highest prices for february that we've ever seen above $3.50 a gallon. if we look historically since 2000 taking out the super spike we saw back in 2008, prices are usually about 15%, 16% higher by the july 4th weekend than they were for february and valentine's day, according to oil price information. that would put us at around the record rate for july 4th and the

july holidays around $4.10 a gallon. now, that doesn't mean that it's going to be that way everywhere. certainly in california already we've seen higher prices because of refinery outages on the east coast. we could all very well see a five handle, guys. but in the rest of the country, barring another super spike, the expectation we'll see prices back around $4 this summer. and last week when i asked her she said she thinks she can handle that and thinks the consumers are already used to handling those prices. >> i guess we've been talking about it so much that people feel it's inevitable at this stage. bertha, thank you very much. herb. >> yes, ma'am. >> good afternoon. >> good afternoon. >> very polite. >> and polite. yes, ma'am. just the way i like it. i've been training him well. what's trending? >> you haven't been training me. listen to her. other than the oil and gas exploration stocks you would expect on a day like today,

universal display, which is one of those battleground stocks we talk about every now and then, they make l.e.d.s used in smartphones. anyway, big battleground stock being chatted a lot about today. have no idea why. just mentioning it to you. hmsy, a company that does cost containment and consulting for corporations, terrible earnings -- earnings that were -- >> easy for you to say. >> let me get this straight. earnings weren't what people expected. stock is in the chattersphere as i like to say. and career education, no idea why people are chatting about it so much today, but they are. and i wanted to bring that to your attention. >> how about that story in "in the huffington post" wining and dining on the $14 cocktails. these are for profit college executives at a swank resort. >> this was a great story. >> it does have the outrage

factor as we say. >> it is not what those executives want to see at this point in time, but apparently they got some good spa treatment over there. >> well, that makes it all okay then. >> this is a great story. >> looking a whole lot better. >> great story unless you're a taxpay taxpayer. >> that's right. which we all are. >> on deck, are you terrified of losing your phone? hands up if you are. i am one of them. there is now a name fear affliction. >> and stock screener friday here on "street signs." we've found five mid-cap tech names who may be on the smaller side but meet some pretty big and tough criteria. >> and rising from the ashes. the old tech titans are making a comeback. the question is, is it too late to get in?

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check out baidu. stock trading higher after strong guidance. but morgan stanley advised clients to short it. by the way, baidu up a cool, get this, 785% from the market lows of 2009. wow. >> wow. well, the nasdaq meantime has a wow factor up 133% from the march 2008 bottom. while apple is one of the biggest names, what's old is suddenly new again. the old tech titans now phoenix rising from the ashes. cisco has had the sixth biggest

impact of the nasdaq 100 year-to-date. oracle has had the third biggest impact. intel trading at levels not seen since 2008 and microsoft now at a four-year high. of course, apple has had the most impact in the nasdaq 100 year-to-date. you can see back above the 500 mark. joining us now is richard davis, richard, great to have you with us today. do you feel that what is driving these big tech titans is that things have got expoen s nen sh get better or the expectation things will get better? >> i think it's a little both. investors so underweight risk and when the fast growth cloud names shot up, relative valuation became so compelling that these tech titans, the big guys you're talking about, just became too cheap to not buy. the average one of these big companies are trading at ten times earnings, the average cloud company trades at 40 times earnings. that gap is just too big to ignore.

that's why you're seeing the big guys catch up. >> you can't lump them all in, right? cisco, dell, microsoft, very different companies, very different growth projections, if there is growth at all in some of those names. of those three, cisco, dell, microsoft, are there any you would buy? and if you had to just buy one, which one would it be? >> my area of expertise is more in the software area, so i would be bias towards microsoft. i think they have an upgrade cycle. there's actually even a bit of a pc upgrade cycle coming along. we had our semiconductor analyst come back from china and he picked up some indications that that's the case. so in that case i think that would be the one i would play. >> it's up 20% year-to-date. would you still say it's cheap? >> it is. actually, if you pull out the cash, it's closer to nine times earnings. maybe it goes to 11 times earnings, but that's a 20% move in just the multiple. you could still see the stock go up just on that basis. >> you know, you look at microsoft and of course they like to position themselves as a cloud company, but they got, you know, obviously they've got

their enterprise suites, trying with phones, if they can get the cloud right, how much more of a multiple does microsoft deserve then? >> well, then, you could get -- that's the big bull case. if windows 8 really takes off and those kinds of things, then the multiple could go from a nine to maybe a 14 or 15, which would be a big move. that's not what we would promise, but that's the upside. >> okay. and you have a hold on oracle. richard, thank you very much for enjoying us -- i didn't mean to say that. joining us. >> thank you very much for enjoying us. >> that was extremely freudian. >> that's what i usually do. >> wait for that one to hit the chattersphere. do you guys get anxious if you do not have your phone on you? i'm there too. and now there's a name for your phobia. it's called nomophobia. a london company found 66% of

pe people polled say they are terrified. only 53% suffered of course that is music to the ears of the smartphone makers. >> there was a great line this morning joe was talking about this. he was on a plane last week, said he lost his phone and i could just see him, he said he was having almost a coronary. >> yeah. heart palpitations. i often thought if the house was burning down i would have to choose between the photo albums, my purse and phone, i know which one i would take. >> yeah, i do. >> the kids. is time running out for the rally? the scary story inside the charts. >> tell me what wing -- >> all right. we're going to be serving up a tommy boy-approved sunshine stock. thank you for enjoying us. we'll be back after this break. you ready? we wanna be our brother's keeper. what's number two we wanna do? bring it up to 90 decatherms.

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the street hungry for some food stocks today. look at that. b & g foods up 7%. heinz up more than 4%. nearly 5%. general mills cut guidance. the stock there is sinking. a mixed bag in the chex mix of the food stocks today.

>> what do you have hip replacements on your mind. >> another one-time great battleground stock hitting a new low for the year today as it reacts to not so great earnings yesterday. >> people need to fall over more. that would help them. a little sunshine stock for you this friday. buffalo wild wings up 3% after smoking hot earnings. the stock is on fire up 54% over the last year. also coming up next on "street signs," how action in the transport sector could bring this rally to a screeching halt. >> and the world knows him as jeremy lin, but around here we don't call it linsanity. we call him j-money. is the knicks phenomena good place to put your money? "street signs" back in a moment. anything not moving forward... is moving backward. [ tires screech ] [ engine turns over, tires squeal ] introducing the 2013 gs, with the lexus enform app suite --

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it is time for today's street talk. dow theorists do listen up because as the dow industrials march toward 13,000, which is just a stone's throw away, other transports sending up a warning signal. we'll talk about that in a moment. in the meantime, a dosage dilemma. one of the many recalls plague

johnson & johnson over the last year. recalling half a million bottles of infant tylenol. and call it the italian job. italian and swiss authorities seizing fake u.s. treasury bonds with a face value of $6 trillion. not billion, not million, guys, $6 trillion. apparently eight arrests have been made after the alleged criminal charger tried to use the bogus bonds in emerging markets. how about that? incredible. >> let's not forget your buddy from miami vice was caught once at the border of switzerland with $6 billion. >> my buddy's settling. >> let's talk about the serious johnson & johnson story. i know you brought it up. it's a dosage dilemma. seema mody's been following it. what can you tell us? >> another day and another recall for johnson & johnson. today recalling about a half million one-ounce bottles of

infant tylenol after receiving complaints from parents that the container was difficult to use. guys, this isn't the first round of recalls. let's actually take a walk down history lane. we have composed a couple recalls that johnson & johnson has actually faced in 2012 as well as throughout 2011. so today this was the recall that was announced. in december though j & j recalled mote rin. two months before that recalls 200,000 syringes of its anemia drug. concerns there about poet ten si. in august removed about 2.5 million packages of tylenol cold multisymptom gel caps. and in june 2011 pulled 60,000 bottles of tylenol in the u.s. the reason there smelly odor. some compared to the lacquer put on wooden palettes. the rise in recalls poses

several questions. is the fda approving drugs too quickly? is enough testing being done prior to being sold at the local pharma pharmacy? a very hot topic. >> certainly is. and whether companies like that are very snugly with the fda and therefore these things get approved quicker. i don't know, but people have talked about that's one theory. thank you so much, seema. >> let's get back to the markets, right. we got to thinking about dow theory where the transports leadist and there's a great piece on cnbc.com if you ever want to check it out it's among the most read on the site about what the transports are telling us. and what they may be saying despite this nice run, could there be a slowdown ahead? let's bring in chief technical strategist at s&p capital iq. what are the transports telling us and you about the overall market right now? >> well, i've been looking for a top in the s&p 500 between about 1360 and 1380. we did go to new highs on the

dow jones industrials but we did not on the dow jones transports. at the recent high the transports were still about 4% from their highs that we saw last year. so we have a nonconfirmation here between the transports and the industrials. many times this leads to at least a small pullback. i do think we're in a strong up trend, so i'm only looking for about a 3% to 5% pullback in the s&p 500. and a bit more for some of the other cyclical areas. >> why do you think the dow transports have quietly rolled over as you put it. >> you don't ask a technician why. we are just suppose today interpret the charts. it is negative. the transports are a very cyclical economically sensitive index. when you see weakness there and strength other places including nasdaq 100, which has been on a real tear, it's one of the warning signs that we've seen. >> how magic a number do you think 13,000 really is from a

technical standpoint? obviously psychologically it is rather important. and it's a nice round number. but from a technical point of view, how important is it? >> i think it's not very important at all. as you said, it is a psychological level, which also means that it could represent, you know, at least a short-term ceiling for the market. i follow the s&p 500 a little closer. we're getting close. we're right at the highs we saw last year. many times when a market moves dramatically, we've had a real good move since october and we move back to a prior high. that represents, you know, at least a temporary ceiling for the market. >> thank you so much for joining us today. you also feel the u.s. dollar index has turned the corner and see a strengthen greenback. mark, thank you. >> not all are stalled out. look at freight car america. full steam ahead today. blowing away earnings expectations. get some of these numbers. pretty heavy.

revenues more than tripled since 2010. the company delivered 1800 more than a same quarter a year ago. their order backlog nearly quadrupled from the fourth quarter of 2010, i pointed out on twitter i thought that was one of the more bullish signs i had seen in a long time. it's simply one company. >> i have to go back and read the conference call. i would like to see what they're attributing that to. >> basically shipments and coal and other things have been stronger despite weakness in coal. they've sold more rail cars. they've refurbished more rail cars. i was trying to find a herb greenberg-like hole in the numbers. >> also a disconnect with the bdi and also what we were talking about with the dow transports. >> it's domestic. goes back to the domestic u.s. story versus the international slowdown story. i want to say that the don johnson thing off wikipedia ya, it's like nothing happened. wasn't convicted for anything. coming out of a meeting or whatever. it was like bank notes in the

car. a widely known story. just throw it out there. >> my buddy, don johnson. okay. >> you seem like more of a boxer-brief guy. focusing on hanes brands. is that true? >> you like your boys -- >> not even going there. i mentioned yesterday -- >> oh, thank you for enjoying us. >> the kind of crazy trading in hanes brands. the underwear maker's stock barely budged after the company reported a weak quarter. and really what i would say would be weak guidance. enter today. you still would not guess the company actually whiffed it. but take the numbers -- take a look at the numbers, and you might get a hint at why i just keep shaking my head over this one. let's start with the gross operating margins. they haven't been this low since the company spun out from sara lee a number of years ago. year over year revenue growth is

stalling. actually went negative last quarter. but the number that really caught my attention, cash flow. on november 2nd, this is just two months before the end of the quarter, the company forecasts that free cash flow for that year would -- the year about to end, would be about $100 million to $200 million. as it turns out it was only about $91 million. but not to worry. hanes says that this year it will be about $400 million to $500 million. i talk today brian, the hedge guy, he says he gets about $265 million for the cash flow. and he also believes that this is a sub $10 stock move and the street thinks it's an over $30 stock. >> hanes brands. net income gone from $51 million at the end of 2010 annualized to more than $260 million at the end of this year. net income's gone very well. and couldn't you argue that hanes brands, given what they sell, is somewhat recession proof. thank goodness underwear is not an optional item. for most people.

>> this is going to be a price competitive product. you watch. price competition's been a big issue here. it will continue. >> crude oil settling at $103 and change for a barrel. that is a nine-month high. definitely towards the upper end of the $95 to $105 trading range we've been in for about 16 weeks now. >> and to the last point, sorry to jump back because i have to say underwear prices i agree with you they have been commoditize in the past. >> oh. >> coming up next, the five names that made the cut in our special friday stock screener. >> thank you for enjoying us. you'll probably never tune in again. we're looking at hot cutting edge mid-cap techs. are they a better bet than the big guys? cnbc celebrates black history month. john rogers, sr., pioneer, patriot, pilot. the recently released film "red tails" reigniting interest in the famed tuskegee airmen. flew over 100 mission for the

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we are on session highs. we are up 48 points. dow 12,952. we've been talking about friday the 13,000. not there yet, folks. we are inching up. 1:20 left in the session. stock screener friday where we come up with tough criteria to find stocks not in the headlines but merit some of your attention nonetheless. since we talked about huge big tech names earlier in the session, we decided to get more micro. here are the metrics of our screener. herb, are you paying attention? u.s. based tech company, market cap $2.5 billion to $15 billion, forward p/e below 15 and cash on the book of at least $1 billion and got to have according to capital iq, estimated annual eps growth of at least 10%.

pretty hard criteria. not a lot of names made it. here they are. western digital, advanced microdevices. ca technologies, si man tech and bmc software. so let's talk about those and some other names. joining us is new face to cnbc managing member at grt capital partners. he manages the five-star rated fund up 4% over the past year and 29% over the past three years. rudy, i'm sorry. i wrote your name down wrong in the tell prompter. do you own any of those names we mentioned in our screener? >> i don't own any of those names but i own seagate

technology. >> go through you small caps. >> i focus more on the small cap stocks. and the three that i have on my list are magna chip. >> uh-huh. >> ultraclean and intovac. they're all inexpensive but i own them for different reasons. magna chip is a vested ipo trading at a single digit p/e. and it basically -- it's got tremendous free cash flow. i think you're going to see that. that will be a theme there. that's why i own magna chip. >> can we go back to my screener? >> oh, yeah. >> i want to ask why do you own seagate and not western digital? >> there's not necessarily one particular reason. they're both very high-quality companies. at the time western digital was more effected by the thailand flooding. so i happen to own seagate. >> is there any sign that's

going to cause them permanent market share loss? if that is a black swan but a temporary event, they can keep their market share and keep production eventually. wouldn't that have been a great buying opportunity longer term? >> absolutely it was. the idea was we should have bought both of them at this because the flooding has actually firmed up pricing and has allowed them to, you know, just generate an awful lot of earnings. >> why are you not as bullish on amd? >> again, it's just hard to compete with intel as the bottom line. >> uh-huh. >> i mean, and i'm not an expert on that. we've got a tech expert in our firm. it's just a hard row to hoe. >> okay, thank you so much for joining us today. >> you're very welcome. >> coming up, your next guest is stumped over stumph. >> and rick picks up the hammer. >> smash it.

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wells fargo chairman and ceo john stumph was on cnbc earlier today talking housing and economy and the notion of too big to fail. >> if i screw up or our company or our team screws up, our

company, we should fail. failure is an important part of capitalism. and simply have to just look at the capital stack, first wipe out your common stockholders, then your preferred stockholders, then your unsecured creditors and then secured creditors. there's plenty of money there to cover any scenario. so we are not too big to fail. >> all right. some pretty powerful words there. let's bring in our own rick santelli. rick, talk to us about what you heard from mr. stumpf as well. the reality is wells fargo may be the most powerful bank for most americans in america. >> brian, you know, my favorite statement to make is the only regulation that works is failure. my hat is off. i completely agree. you know, i wish we could send a copy of that sound bite to the ecb right now as some of your guests have discussed the way they are now subordinating some of the other bondholders.

you know, i know that after a crisis and we went through a horrible crisis in '08 and things get out of whack a bit. but hopefully we can get out of this rabbit hole because government can't micromanage the biggest rubix cube machine, we need to let the car companies or other companies sink or swim on their own merit. >> rick, before we go, we saw you smashing deficits down at the pits earlier today. >> i was. you know, about four our five years ago i met gallagher at a function and we somewhat stay in touch. i figure, if you want to smash a deficit, you got to get somebody like gallagher to show us how to do it. >> that looks like so much fun. i bet you got a lot of anger out, rick. you must be very zen and chill going into the weekend. >> absolutely. congress, take note. it's very therapeutic to smash

watermelons. >> let congress know it's therapeutic to smash deficits. they only grow deficits. >> i know. believe me, it wasn't easy and it's more of a spending issue and there's a lot of human tragedy because every dollar we're going to stop spending is going to come out of somebody's pocket. >> rick. >> what? >> you've come from chicago. chicago politics. you do not get elected by telling people what they're not going to get. >> bingo. hey, we have to end this segment. the stencil has moved to washington really may be modelled after illinois and chicago and draw your own conclusions about how that may turn out. >> let me borrow your hammer some time. thanks a lot, rick santelli. >> thank you. >> let's bring in chris thornburg and diana olick as well because he talked about housing mortgages and the state of the lending market. he basically said that even today the only borrowers that are having an easy time getting money or maybe the only ones getting money period, are those with pristine credit scores. take a listen.

>> we need to make sure we work with owners of mortgages such that we don't have the unintended consequence of eliminating credit for people with some blemish on their credit record. it's a big issue. >> chris thornberg, is that what's holding housing back right now? >> no. we've been hearing this for a long time, both from the banks and the national association of realtors, the idea that it's credit and confidence that's holding the housing market back. a study from the federal reserve shows a significant portion of families end up buying another house. so clearly there's lots of people out there who figured their way out through that particular land mine. >> what do you think is the main problem holding housing back, if not the lack of availability of credit? >> first, is because of all the foreclosures, we're seeing a big shift in demand away from owner occupied housing to more multihousing.

of course, a lack of equity. over the course of that real estate bubble, we saw about $8 trillion in new mortgage debt created in the u.s. on the basis of what people thought was $18 trillion of real estate wealth. the wealth is gone, the debt remains. last, but not least, over the course of that housing bubble, we overbuilt the housing market by about 3 million units. but the good news is, it looks like everything's starting to shift. >> diana, anecdotally, what are you seeing, what are you hearing? can anybody get a mortgage today, at a certain price, 1ya 9 certain group of people? >> mortgage credit i don't think is quite as tight as a lot of people are making it out to be. i do think you do have to have a down payment. you do have to be able to prove you have a job. you have to give them paperwork to prove you can actually pay off this mortgage, unlike during the housing boom. but i do believe what's holding back a lot of the housing market

is confidence. it's not only buyer confidence, it's seller confidence. there's also that issue of negative equity, and near negative equity. don't forget that when you want to sell your home and move up to another home, you need to have more than the additional down payment. you have to pay closing fees, broker fees, and so many people are in the near negative equity position they cannot be move-up buyers. that said, all of the demand is on the low end. the trouble is, when you talk about -- and this is what i'm talking about on the blog today also -- is if you have bulk sales to investors and you get rid of the supply quickly, there's not a lot left out there. you do not have organic sellers putting their homes on the market. that may create a problem, because of so much rental demand, that we've been talking about. we'll talk more about spring roots to recovery next tuesday in a housing special day on cnbc. you want to look for that. >> chris, let's keep this simple and get to the bottom line.

how strong a recovery year for housing will this be? >> actually, a lot of good things are happening. housing vacancies are falling, the number of units listed on multiple listing services is starting to fall. overall, the number of foreclosures is starting to fall. delinquencies are starting to fall. >> chris, how much is that falling inventory, though, that you talk about, the distressed inventory that's coming down and not necessarily the organic? because as the banks have been holding off its inventory for fear of lower prices, and as foreclosures have been stalled, the inventory numbers are definitely coming down. but the existing home sales right now don't account for that. we're not seeing this huge surge in home sales that would account for that much drop in inventory. >> well, that's my point exactly. the inventory is starting to fade away, because there's just enough sort of underlying de mapped for various sources of folks, investors are buying homes, some families are moving into homes. so, you know, overall, whatever is driving those numbers down, the fact is, the markets are

becoming a little bit tighter, and that's the first steps to a recovering market. i really do think american housing market is going to start turning a corner over the course of 2012. and it's going to add to the ongoing overall recovery we're seeing. >> thank you so much for joining us today. we're going to go for a quick break. forget lynn sanity. he's j. money to us on "street signs." >> we have named him unilaterally. coming up, how can you get a piece of j-money. we'll talk about it.

we're less than 50 points away from 13,000. in fact, we have not been 13,000 since may of 2008. as for the s&p 500, it is at its highest in about ten months. in fact, it's more than doubled since hitting a low since march of 2009. >> we had our guest on about 15 minutes ago, basically said he loved this company. stock moved a bit. stog watch. mx magna chip. >> spiking nearly 5% there. we are asking the question, how much would you invest in jeremy lin incorporated? our own d-ro is there with that. do you like that, j-money? >> this is just a new thing.

our meeting has now been truncated to j-lin. i want to take you through what happens if you invested in jeremy lin, and you can in various ways. there's various levels of investment here. the first is a 1999 linsanity t-shirt. and the swing line knicks jersey. how about going to a game tonight, the average price paid per ticket for tonight's game is $175. according to tickets now. and then $9,620, not a bad investment for the new york knicks. that's how much they pay him per game. okay? >> wow. >> now, there's some more. we have $15,600, that's bidding on an autographed rookie card on ebay. still has five days left. somebody yesterday paid $40,000 for his first game used knicks

jersey. he played 1:38 in the game. so you don't even have much sweat on there even. $173 million is the market cap of msg since he first played for the knicks. since we're calling him j-money -- oh, we don't have it. a cartoon of j-money. >> i will say this, i went to a knicks game, about a month ago, went to ticket master and got tickets, about $60, middle of the road seats, now there's only one seat available for the game. >> there it is. i don't know if you can see it. >> dare i ask? >> it says something like j-money. take me to the -- i don't know. >> is he worth it? >> he's worth it for the knicks because they don't have to pay. but the question is, the question is, is he worth it if you're going to buy a $90 jersey. do you really believe in him, you know. by the way, my show, sports biz game on -- >> what's the name?