>> and a bird's eye view of political history from the documentary film maker who invented a new way of making movies. "the wall street journal report" begins right now. >> this is america's number one financial news program. the wall street journal report. now, maria bartoromo. >> here's a look at what's making news as we head into a new week on wall street. most major american banks passed

a big test this week. the stress test. an unemployment rate of 13%, a decline in stocks of 50% and a 21% decline in housing prices. 15 of the nation's largest banks passed the test. wells fargo and bank of america all passed the test while citi, met life, allied financial and sun trust did not pass the test. they fouled. the industrial average closed above 13,000. the nasdaq finished above 3,000. its all-time high is 5,000. that was thursday, the first time ever all of the index traded above those numbers at once. the federal reserves open market committee met on tuesday and took no action on interest rates, but gave its view of the economy a modest upgrade.

the january numbers will also revise upward to .6 of a percent. retail sales always important because the consumer is about 70% of america's economy. how important are the market numbers? and is it time to jump in on equities. joining me now, david kelly. and david gardener, cofounder of the motley fool. gentleman, it's good to see you. thanks so much for joining us. >> we saw major market zones this week. the s&p 500 as 1400. and the feds slightly upgrading its view of the economy. do you think we continue to climb here? what is the significance of those round numbers, if you will. >> well, i think the significance of them is the impact they have on comforts. that's really what's driving a lot of what's going on in the economy and markets in the last few months. people are finally shaking off

the blues they've had in this so called recovery to this point. most confidence measures are moving up. >> david gardener, we also saw another big story this week. and that was the former goldman sachs employee, greg smith. he blasted goldman in a new york times ad saying that the campanili was more interested in making money for itself than for clients and clients were called muppets. what's your take? >> well, first of all, that's one man's view. so i can't really speak to it other than my own eye test which is to look at what he said and see what the ceo said in his voice. if i had to relate to one or the other, i would relate more to the employee who left because i thought he sounded pretty sincere to me. i thought that the ceo of goldman was kind of deflective. i think the more important point here, maria, it's about culture today.

i mean, we're really looking at what it's like to work at a company. i think there's a key virtuous seamarkle. and that starts with really enjoying your members and serving up the right product and service. if you're doing that and your customers love you, then your employees are going to love working there. if they love it and you're serving them that, that's a great cycle. >> we saw most major banks pass the stress test. four did not pass, most notably, citi. how important is this? >> i think it's very important to recognize how stressful the stress tests are. this is not a bad case scenario. this is a disaster scenario. i think it's reflective of how much progress we've made that only four banks dented fully meet all of these criterias.

i think it's goat that the federal reserve does this. it does two things. i think, first of all, it enhances confidence in the institutions themselves. and second of all, it tells you that the federal institution regards these institutions as critical. so they will do what they need to do to make sure that the financial system is solid here. >> david gardener, you're a long-term investor. did any of the big news of the week change the way you're investing? >> to me, first of all, i thought it was nice that 15 of the 19 banks passed. so i thought that was a very important story. i keep going back to the goldman sachs story. i think that the real thing we should be looking at is long term investors. we should be looking at the cultures. i think too many people are dialing in their screeners. they're looking for multiples and that's the way they're investing.

in rah lot of ways, they might be looking at technical investors. so i think, maria, the real key is to look for great counsel tri-s with great cultures. these are all companies that i admire and i think people love working for them. and those are the ones that are going to return us good money as shareholders. >> yes. and david kelly, whether it's culture or uncertainty, people have been afraid to go into stocks. but just recently, we're seeing money come out of bond funds. do you think the retail investors is showily but surely coming back. ? that's why they'd been putting emphasis on the fixed income. >> we've got that friday a week ahg, but as unemployment comes down, that really acts as steroids for consumer confidence and i think that's what's going

to push people away. and thankly, i think a it's good ah see them more balance for the innings. >> and not trying to time our way in and out of asset classes, the better off people like me will be. >> david kelly warix sectors do you like? >> first of all, i couldn't agree more with david gardener. it's very important to have a good asset allocation strategy. in a high market, you want to be with the raising beta stocks. and, yes, financials at this stage as the economy recovers. you've got to fix the income. don't be overweight in arising fixed income. >> we'll see you zone. i had a print out of how many hours

i have actually put in over my career. and it's 168,000 hours. so just think, if you had an 8-hour job, i'm like a man of 100 and something years old. i've worked very hard to support my family. and i finally reached that point where i'm going to retire. ♪ ♪

an airline has planes... and people. and the planes can seem the same so, it comes down to the people. because, bad weather the price of oil those are every airlines reality. and solutions won't come from 500 tons of metal and a paint job. they'll come from people. delta people. who made us one of the biggest airlines in the world. and then decided that wasn't enough.  the two trains and a bus to the 5:00 arider.holar. the "i'll sleep when it's done" academic.

for 80 years, we've been inspired by you. and we've been honored to walk with you 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. is there an end in sight to pain at the pump? the price of oil and gasoline has become the political and economic issue these days. this week, the chairman and ceo of chevron told me prices are likely to remain high. and whether prices will mean less demand. >> well, we're seeing that right now. if you look at the peak in u.s. oil consumption, it was about 21

million barrels a day. it's down to 19 barrel as die. the other component in the united states is a relatively weak economy. so those two factors are contributing. high prices are contributing to a number of different factors around the world. turmoil in the middle east, the fundamentals which is tightening the balance and the financialization and commodities markets. >> okay. given the price of oil where it is right now, above a hundred dollars a barrel, if we stay above these levels, do you think that that will impact economic growth in the united states? >> i think that there's certainly some impact by the price level that we had today. when we start seeing $125 oil or higher, certainly, that will impact the economy. >> can opec do anything to slow down the move in oil? >> i think there's a limited amount that opec can do right now. if you really look at spare

capacity, around the world, there's very little that's part of the reason we're seeing prices rise. >> do you think prices have bottomed there? >> really, they cont reflect cost today. it's equivalent to $15 a barrel. natural gas is much cheaper than oil right now. and it's a function of the dramatic expansion supply that we've seen. the industry has invested rapidly. and that's been great for consumers, great for industrial demand as we have a surplus. over time, i would expect those prices to rise because as we deplete those wells, we'll need to drill new ones and 250 natural gas can't be sustained. >> in terms of the access here in north america, tell me about the access in the gulf of

mexico. and are there areas? le 85% off limits thorax sounds like a huge number. the real issue is in the eastern gulf of mocks co. we have vast acreage of land offshore that we can access and develop. we have the opportunity to great another chevron with the kind of resources that are available out there. but we have to be given the access. we have to drill exploratory wells and then we have to develop the resources that we find. >> what do you think your industry has to do to continue to improve the image? yes, i think the average guy out there does recognize the thing that is you're seeing. but, also, the average guy is going and getting gas every day and is annoyed he and she's paying so much for crude oil and gasoline.

>> i think the public has high expects for us and they should. but i think, over time, the industry has a very good track record of delivering affordable energy. we need affordable energy. it's not going to create the kind of growth that we need in our economy. >> we haven't had an energy policy in the long time. as a student of this business for as long as you have been and a leader in this industry, why? why don't we have an energy policy and what should it look like from your standpoint. >> i think what happened is the long lead times in our business. we had about a sen rio put in. the idea that we're going to

that i think shah and it really didn't square with the shore -- that we really understand the time it takes to proviews affordability of sdatle. >> what is the most available alternative energy that you see today. are largely gee owe thermal resources. we're the number one producer. so we have big investments over cadlies. buy cloy fools and we have to be careful that we don't try to force these ghouls into the market and or thanks to job robson.

becks black blank bank. >> and i hope you look for us on face book. check out wsy with mare rah. i thievery

if you're one of them folks who gets heartburn and then treats day after day... well, shoot, that's like checking on your burgers after they're burnt! [ male announcer ] treat your frequent heartburn by blocking the acid with prilosec otc. and don't get heartburn in the first place! [ male announcer ] one pill a day. 24 hours. zero heartburn.

test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. text. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test test. test. test. test. test. test. test. test.

test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. fest. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test. test

>> when he can out the web site. and i hope you'll follow me on twitter and on google plus. now, a look at the stories coming up in the week ahead that may move the markets and impact your money. the latest earnings news is out from fed-ex, nike, oracle, and tiffany. and then the number of new rh residential units. that roared out on tuesday. and ten the nation's realtors report the number of existing home sales. and then on friday, new home sales will be out ending off the week. finally, the bookends after more than 200 years encyclopedia

britanica will no longer be available on the printed page. britanica planned to focus exclusively on its digital product. the final print edition weighs 129 pounds. if price? $1400. a sign of the times. that will do it for us for today. thank you so much for joining us. my guest next week, investment strategist with his predictions for the market for 2012. have a great week, everybody. i'll see you again next weekend.